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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: April 16, 1999
JWGenesis Financial Corp.
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(Exact name of Registrant as Specified in Charter)
Florida 001-14205 65-0811010
------------------------------ --------------- ------------------
(State or other Jurisdiction of (Commission File (IRS Employer
Incorporation or Organization) Number) Identification No.)
980 North Federal Highway,Suite 210
Boca Raton, Florida 33432
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(Address of Principal Executive (Zip Code)
Offices)
Registrant's telephone number, including area code: (561) 338-2600
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
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ITEM 5. OTHER EVENTS
On April 16, 1999, JWGenesis Financial Corp. (the "Company"), its
wholly owned subsidiary JWGenesis Financial Services, Inc. ("JWGFS"),
and JW Genesis Clearing Corp., a wholly owned subsidiary of JWGFS
("JWG Clearing"), entered into a Stock Purchase Agreement with Fiserv,
Inc. ("Fiserv") and its wholly owned subsidiary Fiserv Clearing, Inc.
("Fiserv Clearing") for the sale of all of the issued and outstanding
capital stock of JWG Clearing to Fiserv Clearing for approximately $58
million in cash. JWG Clearing functions primarily as the Company's
securities clearing, execution, and back office services unit, and
only those operations will comprise JWG Clearing at the time the sale
is consummated.
In connection with the sale, (i) the Company and JWGFS will enter
into a Transition Services Agreement pursuant to which, following the
sale, they will continue to provide certain assistance and services to
JWG Clearing and Fiserv Clearing, and will permit JWG Clearing and
Fiserv Clearing to use certain facilities during a transition period
for a monthly fee approximating the Company's costs; (ii) the Company
and JWGFS will agree not to compete for ten years in the securities
clearing and execution business and not to solicit personnel of JWG
Clearing or Fiserv and its affiliates; and (iii) the Company and JWGFS
will agree, subject to certain limitations and exclusions (primarily
related to the Company's independent contractor registered
representatives, possible future acquisitions, and a one-year phase-in
period), to use and cause their subsidiaries and affiliates to use the
clearing services of designated Fiserv affiliates for at least 90% of
their securities brokerage transactions, and, in the case of the
Company's independent contractor registered representatives, to impose
a surcharge on certain such transactions that are not cleared through
a Fiserv affiliate, during the 10-year period following the sale. The
Company and its affiliates will have the right, however, to be released
from the above obligations to use Fiserv affiliates or to impose a surcharge
by repaying a portion of the sales price based on a prescribed formula that
takes into account the price paid in the sale and the amount of clearing
services business then being generated by the Company or its affiliate
seeking the release.
As a result of the sale and the above agreements, the Company will
cease providing clearing services, both to third party correspondents
(such as broker dealers, banks, and other financial institutions) and
for its own securities brokerage transactions. In deciding to proceed
with the sale and to cease providing clearing services, management concluded
that for the Company to remain competitive in the clearing services business
would require (i) large capital expenditures and resource concentration to
maintain the technology and infrastructure necessary to service the securities
clearing requirements of the more desirable clients, (ii) higher levels of
capital to satisfy increasing regulatory capital requirements resulting from
margin transactions in certain securities that experience rapid increases in
trading prices, and (iii) a significant amount of management time and other
Company resources to meet the challenge of increasing competition in the
securities clearing business, including from firms with substantially greater
financial resources. In addition, the Company's future profit margins on
its clearing business would likely decline as competitive pricing pressures
increase.
While the Company's clearing services operations have been profitable
historically, management believes the sale of JWG Clearing in these
circumstances is in the long-term best interests of the Company. Not
only is the impact on the Company's future profitability from its remaining
overall operations not expected to be material, but the net proceeds from
the sale, which are estimated to be approximately $40 million after tax,
will provide a substantial infusion of capital that can be used to fund
expanded levels of operations in the Company's other business units.
The interim reinvestment of such net proceeds, pending longer term capital
applications, will also offset in part earnings that might have continued to
be realized from the Company's clearing service business before the factors
described above began to significantly erode such earnings. Most importantly,
however, the sale will permit the Company to focus more management time and
other resources on its retail brokerage and investment banking businesses, as
well as to use the newly available capital to pursue possible new opportunities
that management believes have greater potential to enhance value for all
shareholders.
The sale and related transactions described above have been
approved by the Board of Directors of the Company, and no further
corporate approvals by the Company are necessary. Subject to certain
regulatory approvals and customary conditions to closing, the sale is
expected to close May 31, 1999 or shortly thereafter. A copy of the
Stock Purchase Agreement is included herewith as Exhibit 2.1. Such
Exhibit is incorporated by reference into this Item 5 and the
foregoing description is qualified in its entirety by reference to
such Exhibit.
Certain statements included in this Form 8-K, including without
limitation statements containing the words "believes," "anticipates,"
"intends," "expects" and words of similar import, constitute "forward-
looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Such forward-looking statements
involve known and unknown risks, uncertainties and other factors that
may cause the actual results, performance or achievements of the
Company to be materially different from any future results,
performance or achievements expressed or implied by such forward-
looking statements. Such factors include, among others, the
following: the impact of general economic conditions on the capital
markets; changes in or amendments to regulatory authorities' capital
requirements or other regulations applicable to the Company or its
subsidiaries; fluctuations in interest rates; increased levels of
competition; and other factors referred to in the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1998, under
"Item 1. Business - Certain Matters Regarding Forward Looking
Statements," which is incorporated herein by this reference. Given
such uncertainties, undue reliance should not be placed on such
forward-looking statements. The Company disclaims any obligation to
update any such factors or to publicly announce the results of any
revisions to any of the forward-looking statements included herein to
reflect future events or developments.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS.
(a) Not Applicable
(b) Not Applicable
(c) Exhibits
2.1 Stock Purchase Agreement dated April 16, 1999, by and
among the Company, JWGFS, JWGenesis Clearing, Fiserv,
and Fiserv Clearing.
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Pursuant to the requirements of the Securities and Exchange Act
of 1934, the Registrant has duly caused this Report to be signed on
its behalf by the undersigned hereunto duly authorized.
JWGENESIS FINANCIAL CORP.
By: /s/ Joel E. Marks
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Joel E. Marks
Vice Chairman and Chief Operating Officer
Dated: April 30, 1999
STOCK PURCHASE AGREEMENT
By, Between and Among
FISERV, INC.,
FISERV CLEARING, INC.,
JWGENESIS FINANCIAL CORP.,
JWGENESIS FINANCIAL SERVICES, INC. and
JWGENESIS CLEARING CORP.
April 16, 1999
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TABLE OF CONTENTS
Page
ARTICLE I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 1.01 Purchase of Shares . . . . . . . . . . . . . . . 5
SECTION 1.02 Purchase Price . . . . . . . . . . . . . . . . . 5
SECTION 1.03 Determination of Final Stockholders'
Equity in the Company . . . . . . . . . . . . . . . . . . . 6
SECTION 1.04 Holdback . . . . . . . . . . . . . . . . . . . . 7
SECTION 1.05 No Further Transfers . . . . . . . . . . . . . . 7
SECTION 1.06 Section 338(h)(10) Election . . . . . . . . . . 7
SECTION 1.07 Closing . . . . . . . . . . . . . . . . . . . . 8
ARTICLE II . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 2.01 Representations and Warranties of
JWGFC and Seller with Respect to the Company . . . . . . . 9
SECTION 2.02 Representations and Warranties of the Seller . . 27
SECTION 2.03 Representations and Warranties of
Fiserv and Buyer . . . . . . . . . . . . . . . . . . . . . . 29
ARTICLE III . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 3.01 Conduct of Business . . . . . . . . . . . . . . 31
SECTION 3.02 Access to Information by Fiserv and Buyer . . . 31
SECTION 3.03 Confidentiality . . . . . . . . . . . . . . . . 32
SECTION 3.04 Non-Assignable Licenses, Leases and Contracts . 33
SECTION 3.05 Exclusivity and Non-Competition . . . . . . . . 34
SECTION 3.06 Tax Returns. . . . . . . . . . . . . . . . . . . 36
SECTION 3.07 Transition Services . . . . . . . . . . . . . . 37
SECTION 3.08 Additional Financial Statements . . . . . . . . 37
SECTION 3.09 Consents and Authorizations . . . . . . . . . . 38
ii<PAGE>
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ARTICLE IV . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 4.01 Conditions Precedent to the Obligations
of Fiserv and Buyer . . . . . . . . . . . . . . . . . . . . 38
SECTION 4.02 Conditions Precedent to the
Obligations of Seller . . . . . . . . . . . . . . . . . . . 42
ARTICLE V . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 5.01 Survival . . . . . . . . . . . . . . . . . . . . 44
SECTION 5.02 Indemnification for Taxes . . . . . . . . . . . 44
SECTION 5.03 General Indemnity . . . . . . . . . . . . . . . 46
SECTION 5.04 Third Party Claims . . . . . . . . . . . . . . . 47
SECTION 5.05 Limitation on Indemnities . . . . . . . . . . . 48
SECTION 5.06 Effect on Purchase Price . . . . . . . . . . . . 48
ARTICLE VI . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 6.01 Further Assurances . . . . . . . . . . . . . . . 49
SECTION 6.02 Books and Records . . . . . . . . . . . . . . . 49
ARTICLE VII . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 7.01 Termination . . . . . . . . . . . . . . . . . . 50
SECTION 7.02 Effect of Termination . . . . . . . . . . . . . 50
SECTION 7.03 Expenses, Etc. . . . . . . . . . . . . . . . . . 51
SECTION 7.04 Execution in Counterparts . . . . . . . . . . . 51
SECTION 7.05 Notices . . . . . . . . . . . . . . . . . . . . 51
SECTION 7.06 Waivers . . . . . . . . . . . . . . . . . . . . 54
SECTION 7.07 Amendments, Supplements, Etc. . . . . . . . . . 54
SECTION 7.08 Entire Agreement . . . . . . . . . . . . . . . . 54
SECTION 7.09 Applicable Law and Dispute Resolution . . . . . 55
SECTION 7.10 Arbitration . . . . . . . . . . . . . . . . . . 55
iii<PAGE>
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SECTION 7.11 Binding Effect, Benefits . . . . . . . . . . . . 56
SECTION 7.12 Assignability . . . . . . . . . . . . . . . . . 56
SECTION 7.13 Disclosure Schedule . . . . . . . . . . . . . . 56
SECTION 7.14 Public Announcements . . . . . . . . . . . . . . 56
SECTION 7.15 Invalid Provisions . . . . . . . . . . . . . . . 57
INDEX TO EXHIBITS
Exhibit Description
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A Form of Transition Services Agreement
B Form of Opinion for Seller
C Required Consents
D Form of Fully Disclosed Correspondent Agreement
E List of Brokers
F Form of Opinion for Fiserv and Buyer
Schedule 1.06
4
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This STOCK PURCHASE AGREEMENT dated and effective as of
April 16, 1999, is by, between and among FISERV, INC., a Wisconsin
corporation ("Fiserv"), FISERV CLEARING, INC., a Delaware corporation
and a wholly owned subsidiary of Fiserv ("Buyer"), JWGENESIS FINANCIAL
CORP., a Florida corporation ("JWGFC"), JWGENESIS FINANCIAL SERVICES,
INC., a Florida corporation and a wholly owned subsidiary of JWGFC
("Seller"), and JWGENESIS CLEARING CORP., an Iowa corporation
("Company").
WHEREAS, the Company is engaged in the business of providing
securities clearing, execution, back office and related services;
WHEREAS, Seller owns all the issued and outstanding shares
of capital stock of the Company, consisting of 940,625 shares of
Common Stock, $.01 par value ("Common Stock"); and
WHEREAS, Seller desires to sell to Buyer, and Buyer wishes
to acquire from Seller, all the issued and outstanding shares of
Common Stock of the Company.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants hereinafter set forth, the parties agree as follows:
ARTICLE I
PURCHASE OF SHARES, PURCHASE PRICE, CLOSING, ETC.
SECTION 1.01 Purchase of Shares. Subject to the terms and
------------------
conditions hereof, Seller hereby agrees to sell to Buyer, and Buyer
agrees to buy from Seller, an aggregate of 940,625 shares of Common
Stock of the Company, being all the issued and outstanding shares of
Common Stock of the Company, there being no other class of capital
stock of the Company issued and outstanding. The Company has
authorized 25,000 shares of preferred stock, $100 par value, but no
such shares are issued and outstanding. On the Closing Date (as
hereinafter defined) Seller shall sell, transfer and deliver to Buyer
certificates evidencing an aggregate of 940,625 shares of Common
Stock, being all the shares of Common Stock of the Company issued and
outstanding, with all requisite stock transfer tax stamps affixed, and
the certificates duly endorsed or accompanied by appropriate stock
transfer powers duly executed to Buyer. All the shares of Common
Stock of the Company, all of which are owned currently by Seller, are
hereinafter referred to as the "SHARES".
SECTION 1.02 Purchase Price. The aggregate Purchase Price
--------------
for the Shares shall be $40,000,000 plus an amount equal to the Final
Stockholders' Equity (as hereinafter defined) in the Company (the
"PURCHASE PRICE"). On the Closing Date, the Purchase Price, calculated
in part based on the Estimated Balance Sheet specified in Section 1.03
(a) and less the hold back amount specified in Section 1.04 below,
5<PAGE>
<PAGE>
shall be paid by Buyer to Seller in cash by wire transfer in
immediately available funds to an account specified by Seller at least
3 business days prior to the Closing Date. Fiserv shall cause Buyer
to pay when due all Purchase Price amounts payable by Buyer pursuant
to this Agreement.
SECTION 1.03 Determination of Final Stockholders' Equity in
----------------------------------------------
the Company.
- -----------
a) Not less than 20 days prior to the Closing Date, the chief
financial officer of the Company shall deliver to Fiserv and
Buyer an estimated balance sheet of the Company as of 11:59 p.m.
Central Standard Time ("CST") on the Closing Date (the "ESTIMATED
BALANCE SHEET"), which shall have been prepared in accordance
with generally accepted accounting principles ("GAAP") and
consistent with the Company Financial Statements (as hereinafter
defined) for 1998, setting forth in reasonable detail, and having
such form and content as Fiserv and Buyer may reasonably direct,
the Company's estimate of the stockholders' equity in the Company
as of 11:59 p.m. CST on the Closing Date (the "STOCKHOLDERS'
EQUITY"). The Estimated Balance Sheet will be adjusted for
differences between the book value and market value of certain
assets, as mutually agreeable to both Buyer and Seller and set
forth in the Disclosure Schedule (as hereinafter defined).
b) As promptly as practicable following the Closing Date, but
in no event later than 45 days subsequent to the Closing Date,
Buyer shall deliver to Seller a schedule (the "FINAL SCHEDULE"),
which shall include the actual balance sheet of the Company as of
11:59 p.m. CST on the Closing Date prepared on the same basis as
the Estimated Balance Sheet and consistent with the Company
Financial Statements for 1998 of the Stockholders' Equity (the
"FINAL STOCKHOLDERS' EQUITY"). If the Seller disputes the
correctness of the Final Schedule, it shall notify Fiserv and
Buyer in writing of its objections within five business days
after delivery of the Final Schedule, and shall set forth in
writing in reasonable detail in such notice the reason(s) for
Seller's objection(s). If the Seller fails to deliver such
notice within such time period, the Seller and JWGFC shall be
deemed to have accepted Buyer's calculation of the Final
Stockholders' Equity. If the Seller delivers such notice within
such time period, Fiserv and Buyer, on one hand, and JWGFC and
Seller, on the other hand, shall endeavor in good faith to
resolve their dispute over the determination of the Final
Stockholders' Equity within five business days after the receipt
by Fiserv and Buyer of such notice. If they are unable to do so
within such five-business-day period, the dispute (and each
party's final position in writing) shall be submitted, within 5
business days of the expiration date of the previous period, to
an audit partner experienced in the securities clearing industry
of an independent nationally-recognized accounting firm in the
United States as shall be mutually acceptable in writing to
Fiserv and Buyer, on the one hand, and JWGFC and the Seller, on
the other hand (the "INDEPENDENT ACCOUNTANT") who shall act as an
expert and not as an arbitrator, and who shall resolve the
dispute in writing within 10 business days of the submission of
6<PAGE>
<PAGE>
such dispute. The decision of the Independent Accountant as to
the Final Stockholders' Equity shall be final and binding upon
the parties. The fees and expenses of the Independent Accountant
shall be borne in proportion to the difference between the final
determined amount of the Independent Accountant and such amounts
proposed by Fiserv and Buyer, on the one hand, and JWGFC and
Seller, on the other hand; provided that if the final determined
amount of the Independent Accountant is less than the amount
proposed by Fiserv and Buyer or greater than the amount proposed
by JWGFC and Seller, then 100% of such fees and expenses shall be
borne by Seller or Buyer, respectively. Fiserv, Buyer, JWGFC and
Seller shall cooperate with each other and the Independent
Accountant in the determination of the Final Stockholders' Equity
including, without limitation, Fiserv and Buyer allowing JWGFC
and the Seller and the Independent Accountant access after the
Closing Date to the books and records of the Company and to the
accounting and other representatives and advisors of the Company.
Within three business days following final determination of the
Final Stockholders' Equity, as appropriate, Buyer shall pay (in
the same manner as it paid the Purchase Price) any remaining
amount of cash payable to the Seller, or the Seller shall pay any
remaining amount of cash payable to Buyer.
SECTION 1.04 Holdback. At Closing (as hereinafter
--------
defined), Buyer shall hold back from the payment of the Purchase Price
made to Seller as provided in Section 1.02 a sum of cash equal to 5%
of Stockholders' Equity specified in the Estimated Balance Sheet plus
the sum of cash, if any, designated by Buyer pursuant to Section 4.01
(o) (the "Holdback"), pending determination of the Final Stockholders'
Equity as provided in Section 1.03. Following the determination of
the Final Stockholders' Equity, the Holdback shall be used, to the
extent applicable, to implement the final disbursement of cash as
specified in Section 1.03. Any portion of the Holdback not so used
shall remain the sole property of Buyer.
SECTION 1.05 No Further Transfers. Upon and after the date
--------------------
this Agreement is signed by the parties and through the Closing Date,
no transfer of the Shares shall be made, effected or permitted by
JWGFC and Seller and no such transfer of the Shares shall be
registered in the stock transfer books of the Company.
SECTION 1.06 Section 338(h)(10) Election.
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(a) As soon as reasonably practicable after the Closing,
Buyer, JWGFC and the Seller shall timely make a joint election
pursuant to Section 338(h)(10) of the Internal Revenue Code of
1986, as amended (the "CODE"), and Treasury Regulation Section
1.338(h)(10)-1 or any successor provisions and any comparable
election under state or local tax law (individually or
collectively, the "ELECTION") with respect to the purchase by
Buyer of the Shares pursuant to this Agreement. As soon as
reasonably practicable after the Closing and in all events within
180 days after the Closing Date, with respect to the federal
Election, Buyer, JWGFC and the Seller shall mutually prepare a
Form 8023 (with all attachments), and JWGFC (as the common parent
of Seller) shall execute such Form 8023 and promptly deliver it
to Buyer. In addition, the Seller, JWGFC and Buyer shall, and
7<PAGE>
<PAGE>
Buyer shall cause the Company to, as promptly as reasonably
practicable following the Closing, cooperate with each other to
take all actions necessary and appropriate (including filing such
additional forms, returns, elections, schedules and other
documents as may be required) to effect and preserve a timely
Election in accordance with the provisions of Treasury Regulation
Section 1.338(h)(10)-1 (or any successor provision or comparable
provision of applicable law). Buyer, JWGFC and the Seller shall
report the purchase by Buyer of the Shares consistent with the
Election, and neither Buyer, JWGFC nor the Seller shall take any
position to the contrary thereto in any Tax Return, any
proceeding before any Taxing authority or otherwise.
(b) In connection with the Election, JWGFC and Buyer shall
mutually determine, as promptly as reasonably practicable
following the Closing, the Modified Aggregate Deemed Sales Price
and Adjusted Grossed-Up Basis (in each case as defined under the
applicable Treasury Regulations, or other amounts required under
applicable laws) and the allocation of such amounts among the
assets of the Company deemed to have been purchased which shall
be made in accordance with Schedule 1.06, within 30 days after
the Purchase Price is finally determined (taking into account the
matters as provided in Section 1.03 and Section 1.04). In the
event the parties cannot agree on the computation or allocations
within 30 days, the parties shall refer the matter (and each
party's final positions in writing) to the Independent Accountant
within 5 business days of the expiration of such 30-day period,
who shall act as an expert and not as an arbitrator, and who
shall resolve the dispute in writing within 60 days after the
submission of such dispute. The decision of the Independent
Accountant shall be final and binding upon the parties. The fees
and expenses of the Independent Accountant shall be borne by
Buyer and JWGFC as determined by the Independent Accountant based
on the relative difference between such party's position and the
determination of the Independent Accountant with respect to
assets other than goodwill and other Section 197 intangibles.
The parties (i) shall be bound by such allocations for purposes
of determining any Taxes, (ii) shall prepare and file all Tax
Returns to be filed with any Taxing authority in a manner
consistent with such allocations and (iii) except as may be
required by a final determination by a court of competent
jurisdiction, shall not take any position inconsistent with such
allocation in any Tax Return, any proceeding before any Taxing
authority or otherwise. In the event any Taxing or other
authority disputes the allocation, the party receiving notice of
such dispute shall promptly notify and consult with the other
parties concerning resolution of such dispute.
(c) Each party shall cooperate and provide reasonable
assistance respecting the matters described in this Section 1.06.
SECTION 1.07 Closing. The closing of the transactions
-------
contemplated by this Agreement (the "CLOSING") shall take place at the
offices of Fiserv, Inc., 255 Fiserv Drive, Brookfield, WI 53045, on
8<PAGE>
<PAGE>
May 31, 1999, or at such other place or on such other date as Seller
and Buyer may mutually agree in writing (such date of Closing is
herein called the "Closing Date"); it being understood and agreed that
for all purposes relating to Taxes (as that term is hereinafter
defined) the Closing shall be effective as of 11:59 p.m. CST on the
Closing Date.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
SECTION 2.01 Representations and Warranties of JWGFC and
Seller with Respect to the Company. Except as otherwise specifically
set forth in the Disclosure Schedule prepared by JWGFC, Seller and/or
the Company and attached hereto (the "DISCLOSURE SCHEDULE"), JWGFC
and Seller, jointly and severally, with respect to the Company, repre-
sent and warrant to, and agree with, Fiserv and Buyer as follows:
(a) Organization and Qualification, etc. The Company is a
------------------------------------
corporation duly organized, validly existing and in good standing
under the laws of the State of Iowa, has corporate power and
authority to own all of its properties and assets and to carry on
its business as it is now being conducted, and is duly qualified
to do business and is in good standing in each other jurisdiction
as set forth in the Disclosure Schedule where the failure to so
qualify would have a Material Adverse Effect (as hereinafter
defined). The copies of the Company's Articles of Incorporation
and By-Laws, as amended to date, which have been delivered to
Fiserv and Buyer are complete and correct, and such instruments,
as so amended, are in full force and effect at the date hereof.
"MATERIAL ADVERSE EFFECT" for purposes of this Agreement
when used with respect to any party means any change in, or
effect on, or series of changes in, or effects on, the business
of such party as currently conducted by such party that is
materially adverse to the results of its operations or financial
or other condition after giving effect to the transactions
contemplated by this Agreement.
(b) Capital Stock. The authorized capital stock of the
-------------
Company consists of 3,000,000 shares of Common Stock of which as
of the date hereof 940,625 shares are validly issued and
outstanding, fully paid and nonassessable, all of which are held
and owned of record by the Seller, and no shares of Common Stock
are in the treasury of the Company. The Company has authorized
25,000 shares of preferred stock, $100 par value, but no such
shares are issued and outstanding. The Company has no
commitments to issue or sell any shares of its capital stock or
any securities or obligations convertible into or exchangeable
for, or giving any person any right to subscribe for or acquire
from the Company any shares of its capital stock and no
securities or obligations evidencing any such rights are
outstanding.
9<PAGE>
<PAGE>
(c) Subsidiaries. The Company does not own of record or
------------
beneficially, directly or indirectly, (i) any shares of outstand-
ing capital stock or securities convertible into capital stock of
any other company or corporation or (ii) any participating
interest in any partnership, joint venture or other non-corporate
business enterprise.
(d) Authority and Ability Relative to Agreement. The
-------------------------------------------
Company has the corporate power, authority and ability to execute
and deliver this Agreement and to consummate fully all of the
transactions contemplated on the part of the Company hereby. The
execution and delivery by the Company of this Agreement and the
consummation by the Company of the transactions contemplated
hereby have been duly authorized by its Board of Directors and by
Seller as its sole shareholder. Except as contemplated by
Section 2.01 (f), no other corporate, legal, regulatory,
securities or institutional proceedings on the part of the
Company are necessary to authorize the execution and delivery of
this Agreement by the Company or the consummation by the Company
of the transactions contemplated hereby. This Agreement has been
duly executed and delivered by the Company and, assuming the due
authorization, execution and delivery of this Agreement by Buyer
and Fiserv, is a valid and binding agreement of the Company,
fully enforceable against the Company in accordance with its
terms, except as such enforcement is subject to the effect of (i)
any applicable bankruptcy, insolvency, reorganization or similar
laws relating to or affecting creditors' rights generally and
(ii) general principles of equity, including, without limitation,
concepts of materiality, reasonableness, good faith and fair
dealing, and other similar doctrines affecting the enforceability
of agreements generally (regardless of whether considered in a
proceeding in equity or at law).
(e) Non-Contravention. The execution and delivery of this
-----------------
Agreement by the Company do not and the consummation by the
Company of the transactions contemplated hereby will not, except
where such violation, conflict or termination would not have an
Adverse Effect and is set forth on the Disclosure Schedule, (i)
violate any provision of the Articles of Incorporation or By-Laws
of the Company, or (ii) violate, or result, with or without the
giving of notice or the lapse of time or both, in a violation of,
any provision of, or result in the acceleration of or entitle any
person or entity to accelerate (whether or not after the giving
of notice or lapse of time or both) any obligation under, or
result in the creation or imposition of any material lien,
charge, pledge, security interest or other encumbrance upon any
of the property, rights or assets of the Company pursuant to any
provision of any mortgage, lien, lease, agreement, license,
instrument, order, arbitration award, judgment or decree to which
the Company is a party or by which any of its property or assets
is bound, and do not and will not violate or conflict with any
other material restriction of any kind or character to which the
Company is subject or by which any of its property or assets may
be bound, and the same does not and will not constitute an event
permitting termination of any such mortgage, lien, lease, agree-
ment, license or instrument to which the Company is a party, or
(iii) violate any law, ordinance, rule or regulation to which the
Company is subject.
10<PAGE>
<PAGE>
(f) Government and Other Approvals. No consent, authoriza-
------------------------------
tion, order or approval of, or filing or registration with, any
governmental agency, commission, board or other regulatory body,
securities authority or securities self regulatory organization,
including but not limited to the United States Securities and
Exchange Commission ("SEC"), New York Stock Exchange ("NYSE"),
American Stock Exchange ("AMEX") and National Association of
Securities Dealers, Inc. ("NASD"), is required for the execution
and delivery of this Agreement by the Company and the consumma-
tion by the Company of the transactions contemplated hereby,
except (i) for filings with the Federal Trade Commission (the
"COMMISSION") and the Antitrust Division of the Department of
Justice (the "ANTITRUST DIVISION") under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended (the "HSR ACT"),
and the termination of the requisite waiting period thereunder,
(ii) as may be necessary as a result of any facts or
circumstances relating solely to Buyer, (iii) filings with or
approvals by the NYSE or NASD relating to the change in control
of the Company from Seller to Buyer as contemplated by this
Agreement, or (iv) where the failure to obtain such consents,
authorizations or approvals or to make such filings or
registrations would not prevent or affect adversely the
consummation of the transactions contemplated hereby.
(g) Financial Statements. The Company, JWGFC or Seller has
--------------------
previously furnished Fiserv or Buyer with true and complete
copies of the audited balance sheets of the Company as of
December 31, 1997 and 1998, and the related audited statements of
income, retained earnings and cash flows for the two years then
ended (collectively, the "COMPANY FINANCIAL STATEMENTS"). In
addition, the Company, JWGFC or Seller has previously furnished
Fiserv or Buyer with true and complete copies of all Focus
Reports the Company prepared and filed, or caused to be prepared
and filed, for calendar year 1998 and, as applicable, all time
periods since December 31, 1998 (the "FOCUS REPORTS"). All of
the Company Financial Statements and Focus Reports have been
prepared in conformity with GAAP consistently applied and present
fairly the financial position and results of operations of the
Company as of and for the respective periods then ended.
(h) Absence of Certain Changes or Events. Since December 31,
1998, the Company has not:
(i) incurred any obligation or liability (fixed or
contingent), except normal trade or business obligations
incurred in the ordinary course of business and consistent
with past practice;
(ii) discharged or satisfied any lien, security inter-
est or encumbrance or paid any obligation or liability
(fixed or contingent), other than in the ordinary course of
business and consistent with past practice;
11<PAGE>
<PAGE>
(iii) mortgaged, pledged or subjected to any lien,
security interest or other encumbrance any of its assets or
properties (other than Permitted Exceptions (as hereinafter
defined));
(iv) transferred, leased or otherwise disposed of any
of its assets or properties or acquired any assets or
properties, except in any case in the ordinary course of
business and consistent with past practice;
(v) canceled or compromised any debt or claim, except
in the ordinary course of business and consistent with past
practice;
(vi) waived or released, under any contract, any
rights of the Company having value to the Company, except in
any case in the ordinary course of business and consistent
with past practice;
(vii) transferred or granted any rights under any
concessions, leases, licenses, agreements, patents,
inventions, trademarks, trade names, service marks or
copyrights, or with respect to any know-how of the Company,
except in the ordinary course of business and consistent
with past practice;
(viii) except in the ordinary course of business and
consistent with past practice, made or granted any wage or
salary increase applicable to any group or classification of
employees generally, paid any bonuses, entered into any
employment contract with any officer, employee, contractor
or agent, or made any loan to, or entered into any transac-
tion of any other nature with, any officer, employee,
contractor or agent of the Company;
(ix) entered into any transaction, contract or com-
mitment, except those listed, or which pursuant to the terms
hereof are not required to be listed, on the Disclosure
Schedule, this Agreement and the transactions contemplated
hereby, and those entered into in the ordinary course of
business and consistent with past practice;
(x) suffered any casualty loss or damage (whether or
not such loss or damage shall have been covered by
insurance) which affects in any material respect its ability
to conduct its business; or
(xi) suffered any Material Adverse Effect.
"PERMITTED EXCEPTIONS" shall mean (i) mechanic's,
materialman's, warehouseman's and carrier's liens and purchase
money security interests arising in the ordinary course of busi-
ness; (ii) liens for Taxes (as hereinafter defined) and
assessments not yet payable; (iii) liens for Taxes, assessments
12<PAGE>
<PAGE>
and charges and other claims, the validity of which the Company
is contesting in good faith; and (iv) imperfections of title,
liens, security interests, claims and other charges and
encumbrances the existence of which would not have in the
aggregate an Adverse Effect.
"ADVERSE EFFECT" means any change in, or effect on, or
series of changes in, or effects on, the business of the Company
as currently conducted that would result in the incurrence of
damages or liability of the sum of $100,000 or more.
(i) Title to Properties; Absence of Liens and Encumbrances, etc.
------------------------------------------------------------
The Company has full, good and marketable title to all of
the real, tangible, personal and mixed properties and assets
owned by it and used in its business, free and clear of any
liens, charges, pledges, security interests or other encumbrances
(other than Permitted Exceptions), except as reflected in the
Company Financial Statements or except as incurred since December
31, 1998, in the ordinary course of business and set forth in the
Disclosure Schedule. The Company's intangible properties and
assets (excluding leasehold interests and all intangible
properties and assets described in Section 2.01(j) and 2.01(n),
which sections contain the Company's and the Seller's
representations and warranties with respect to such intangible
properties and assets) are free and clear of any liens, charges,
pledges, security interests or other encumbrances (other than
Permitted Exceptions), except as reflected in the Company
Financial Statements or incurred since December 31, 1998, in the
ordinary course of business and set forth in the Disclosure
Schedule.
(j) Software
--------
(i) The Disclosure Schedule contains a list or
description by type of all Software (as hereinafter defined)
which the Company uses or has available for use and/or plans
to use in connection with its business, and such Software
constitutes all the Software which is used in connection
with or is necessary to operate the business of the Company
as currently conducted. Except as indicated in the
Disclosure Schedule, all such Software is owned outright by
the Company.
(ii) As to any Software which is listed in the
Disclosure Schedule and is not owned by the Company, to the
knowledge of JWGFC, Seller or the Company, the Company has
the right to use the same pursuant to valid leases or li-
censes therefor, and, except as otherwise disclosed in the
Disclosure Schedule, to the knowledge of JWGFC, Seller or
the Company, all such leases and licenses are in full force
and effect and there is no default, nor any event which with
notice or the lapse of time or both, will become a default
under any such lease or license by the Company or any other
parties thereto which will have an Adverse Effect.
13<PAGE>
<PAGE>
(iii) To the knowledge of JWGFC, Seller or the
Company, none of the Software used by or available to the
Company for use in connection with its business as afore-
said, and no use thereof, infringes upon or violates any
patent, copyright, trade secret or other proprietary right
of anyone else and neither JWGFC, Seller nor the Company has
received notice of any claim with respect to any such
infringement or violation.
(iv) The Company possesses the original and, to the
knowledge of JWGFC, Seller or the Company, all copies of all
documentation, including without limitation all source
codes, for all Software owned outright by it (other than
such as shall have been furnished to customers in connection
with the provision of the services of the Company), and, to
the knowledge of JWGFC, Seller or the Company, the Software
which is licensed or otherwise provided to the Company by
other persons or entities performs in accordance with the
documentation and other written material used in connection
with the Software and, to the knowledge of JWGFC, Seller or
the Company, is in machine-readable form, contains all
current revisions of such software, and includes all
computer programs, materials, tapes, know-how, object and
source codes, other written materials, and processes related
to the Software. The Company has made available to Fiserv
or Buyer complete and correct copies of all material user
and technical documentation related to the Software.
(v) To the knowledge of JWGFC, Seller or the Company,
no employee, contractor or agent of Seller used or employed
in the Company is in default under any term of any
employment contract, agreement or arrangement relating to
the Software or non-competition arrangement or any other
contract, agreement or undertaking or any restrictive
covenant relating to the Software or its development or
exploitation except where such default would not have an
Adverse Effect upon the Company. The Software owned by the
Company was developed by the employees of the Company during
the time they were employees only of the Company and/or was
developed by contractors or agents of the Company pursuant
to arrangements that vested full title and rights to same
solely in the Company. None of the Software is owned by or
registered in the name of any current or former shareholder,
director, officer, employee, salesman, agent, representative
or contractor of the Company or any Affiliate, nor does any
such person or entity (except a licensor of the Software
licensed by the Company) have any interest therein or right
thereto.
(vi) The Company has taken reasonably appropriate
measures to protect the confidential and proprietary nature
of the Software, including, without limitation, the use of
confidentiality agreements with all of its employees,
contractors and agents having access to the Software source
and object codes; the Company has, however, disclosed source
14<PAGE>
<PAGE>
and object codes for the Software owned by the Company to
those persons who have licensed such Software from the
Company in the ordinary course of business.
(vii) Upon consummation of the transactions
contemplated by this Agreement, (x) the Company will
continue to own all of the Software owned outright by the
Company and used primarily or principally in its business
prior to the Closing, free and clear of all claims, liens,
encumbrances, obligations and liabilities except those
disclosed in writing and existing at Closing and except for
such claims, liens, encumbrances, obligations and
liabilities of Buyer (i) applicable to Software leased or
licensed to third parties and (ii) as may be granted by the
Company after the Closing Date; and (y) with respect to all
agreements for the lease or license of Software which re-
quire consents or other actions (all of which consents or
other actions are listed in the Disclosure Schedule) as a
result of the consummation of the transactions contemplated
hereby in order for the Company to continue to use and
operate such Software after the Effective Date, Seller and
JWGFC shall endeavor and use all commercially reasonable
efforts to obtain all such consents or take all such other
actions as reasonably required.
(viii) Seller, JWGFC and the Company represent and
warrant that, except as may be specified in the Disclosure
Schedule, the Software and all hardware and other equipment
used in connection with the business of the Company and that
will be acquired by Buyer hereunder is Year 2000 Compliant
(as hereinafter defined). The term "YEAR 2000 COMPLIANT"
means that the Software and hardware and all other equipment
shall consistently function in the same manner after
December 31, 1999, as they were warranted to work before
such date and shall correctly process dates and related data
falling after December 31, 1999.
"SOFTWARE" means each and every computer program, operating
system, applications system, data base, firmware or software of
any nature whatsoever (except for any license implied by the sale
of a product and perpetual, paid-up licenses for commonly-
available software programs with a value of less than $2,000
under which the Company is licensed), owned, used, licensed or
sublicensed by Seller, JWGFC and/or Company in its business,
whether operational, under development or inactive, including all
object code, source code, modules, technical manuals, issuer
manuals, program flow charts, file layouts, report layouts,
screen layouts and other documentation therefor (including
internal notes, memoranda, status evaluations, marketing
information and write-ups), and all improvements, modifications,
enhancements, new releases and revisions thereof, whether in
machine-readable form, programming language or any other language
or symbols, and whether stored, encoded, recorded or written on
disk, tape, film, memory device, paper or other media of any
nature.
15<PAGE>
<PAGE>
(k) List of Properties, Contracts and Other Data. The
---------------------------------------------
Disclosure Schedule contains a list setting forth with respect to
the Company as of the date hereof the following:
(i) all real properties owned in fee simple by the
Company;
(ii) all leases of real or personal property to which
the Company is a party, either as lessee or lessor with a
brief description of the property to which each such lease
relates, except such leases of personal property as require
payment during their remaining life aggregating less than
$50,000;
(iii) (A) all patents, trademarks and trade names,
trademark and trade name registrations, servicemark
registrations, copyrights and copyright registrations,
unexpired as of the date hereof, all applications pending on
said date for patents or for trademark, trade name,
servicemark or copyright registrations, all other
proprietary rights owned, controlled or held by the Company
and reasonably necessary to, or used by the Company primar-
ily in connection with, its business and (B) all licenses
granted by or to the Company and all other agreements to
which the Company is a party which relate, in whole or in
part, to any items of the categories mentioned in (A) above,
other than any such license or other agreement requiring
payments during its remaining life aggregating less than
$50,000 or terminable by the Company within one year without
payment of a premium or penalty;
(iv) all collective bargaining agreements, employment
and consulting agreements (other than consulting agreements
terminable by the Company within 60 days without payment of
a premium or a penalty), Employee Plans, as defined in
Section 2.01 (r), including, but not limited to, executive
compensation plans, bonus plans, deferred compensation
agreements, employee pension plans or retirement plans,
employee profit sharing plans, employee stock purchase and
stock option plans, group life insurance, hospitalization
insurance or other plans or arrangements providing for
benefits to employees of the Company;
(v) all contracts and commitments (including, without
limitation, all Fully Disclosed Correspondent Agreements
(and/or all other securities clearing, execution, back
office and related agreements), mortgages, indentures and
loan agreements) to which the Company is a party, or to
which it or any of its assets or properties are subject and
which are not specifically referred to in (i), (ii), (iii)
or (iv) above; provided that there need not be listed in the
--------
Disclosure Schedule (unless required pursuant to the
preceding clauses (i), (ii), (iii) or (iv) above) any
contract or commitment incurred in the ordinary course of
business and consistent with past practice which requires
payments to or by the Company during its remaining life
16<PAGE>
<PAGE>
aggregating less than $50,000, and provided further that
JWGFC and Seller shall remain solely responsible for the
ADP/SIS contract; and
(vi) the current annual compensation of all employees
of the Company (by position or by department) as of a recent
date (a copy of which has been submitted to Buyer but need
not be included in the Disclosure Schedule).
True and complete copies of all documents and descriptions
complete in all material respects of all oral agreements or
commitments (if any) referred to in (i) through (v) above (other
than insurance plans which have been summarized) have been
provided or made available to Buyer or its counsel. The Company
has not been notified orally or in writing of any claim that any
contract or commitment listed in the Disclosure Schedule for this
subsection (k) is not valid and enforceable in accordance with
its terms for the periods stated therein, or that there is under
any such contract or commitment any existing default or event of
default or event which with notice or lapse of time or both would
constitute such a default, except for any such claim which would
have in the aggregate an Adverse Effect.
(l) Litigation, Arbitration, Investigations. Except as set
---------------------------------------
forth in the Disclosure Schedule, there are no actions, suits,
arbitrations, litigations, investigations or proceedings with
respect to the business of the Company pending against or
involving the Company of which JWGFC, Seller or the Company is
aware, at law or in equity, or before or by any federal, state,
municipal, foreign, securities, or any other governmental
department, commission, board, bureau, agency or instrumentality,
or before or by any securities self-regulatory or any other
organization, nor, to the knowledge of JWGFC, Seller or the
Company, are there any such actions, suits, arbitrations,
litigations, investigations or proceedings with respect to the
business of the Company threatened against or under evaluation
respecting or involving the Company.
(m) Labor Controversies. Except as would not reasonably be
-------------------
expected to have in the aggregate an Adverse Effect:
(i) there are no controversies known to JWGFC, Seller
or the Company between the Company and any employees,
contractors or agents any unresolved labor union grievances
or unfair labor practice or labor arbitration proceedings
pending or, to the knowledge of JWGFC, Seller or the Company
threatened, related to the Company and, to the knowledge of
JWGFC, Seller or the Company there are not and during the
last two years prior to the date hereof there have not been
any formal or informal organizing efforts by a labor
organization and/or a group of Company employees; and
17<PAGE>
<PAGE>
(ii) neither JWGFC, Seller nor the Company has re-
ceived notice of any claim that the Company has not complied
with any laws relating to the employment of labor, including
any provisions thereof relating to wages, hours, collective
bargaining, the payment of social security and similar
taxes, equal employment opportunity, employment discrimina-
tion and employment safety, or that it is liable for any
arrears of wages or any Taxes or penalties for failure to
comply with any of the foregoing.
(n) Patent, Trademark, etc. Claims. No person has made or,
------------------------------
to the knowledge of JWGFC, Seller or the Company threatened to
make any claims that the operation of the business of the Company
is in violation or infringement of any patent, patent license,
trade name, trademark, servicemark, brandmark, brand name,
copyright, know-how or other proprietary or trade rights of any
third party; and neither JWGFC, Seller nor the Company knows of
any non-frivolous basis for any such claims.
(o) Use of Real Property. Neither JWGFC, Seller nor the
--------------------
Company has received any notice of violation of any applicable
environmental, zoning or building regulation, ordinance or other
law, order, regulation or requirement relating to the operations
of the Company or any notice of default under any lease, con-
tract, commitment, license or permit, relating to the use and
operation of the owned or leased real property listed in the
Disclosure Schedule, in either case which would have in the
aggregate an Adverse Effect and, to the knowledge of JWGFC,
Seller and the Company there is no such violation or default
which would have in the aggregate an Adverse Effect. Neither
JWGFC, Seller nor the Company has received any notice that any
plant, office or other building which is owned or covered by a
lease set forth in the Disclosure Schedule hereto does not sub-
stantially conform with all applicable ordinances, codes, regula-
tions and requirements, environmental and otherwise, and neither
JWGFC, Seller nor the Company has received notice that any law
or regulation presently in effect or that any condition precludes
or restricts continuation of the present use of such properties
by the Company.
(p) Accounts Receivable. The accounts receivable reflected
-------------------
on the audited balance sheet of the Company as of December 31,
1998, and all accounts receivable arising between December 31,
1998, and the date hereof, arose from bona fide transactions in
the ordinary course of business; except as contemplated by the
relevant contract, arrangement or relationship, the sales or s-
ervices involved have been provided to the account obligor and no
further sales or services are required to be provided in order to
complete the same and to entitle the Company or its assignees to
collect the accounts receivable in full. No such account has
been assigned or pledged to any other person, firm or
corporation.
18<PAGE>
<PAGE>
(q) Compliance with Law. Except as would not have in
-------------------
aggregate an Adverse Effect:
(i) The Company is not in default or in noncompliance
with respect to any law, rule, regulation or order of any
court, governmental authority, securities authority,
securities self regulatory organization (including but not
limited to the SEC, NYSE, AMEX and NASD), arbitration board
or tribunal to which it is subject or a party or, to the
knowledge of JWGFC, Seller and the Company, to which the
Company is subject and which applies to its business, and,
to the knowledge of JWGFC, Seller and the Company, the
Company has not been notified that it is in violation of or
in noncompliance with any laws, ordinances, rules or
regulations to which it is subject or has failed to obtain
any licenses, permits, franchises or other governmental,
securities or other authorizations necessary or desirable
respecting the ownership of its assets and properties or to
the conduct of its business.
(ii) The Company has on file a valid Form I-9 for each
employee hired by the Company on or after November 7, 1986,
and continuously employed after November 6, 1986, or the
applicable date of hire. To the knowledge of JWGFC, Seller
and the Company, all employees of the Company are (A) United
States citizens, or lawful permanent residents of the United
States, (B) aliens whose right to work in the United States
is unrestricted, (C) aliens who have valid, unexpired work
authorization issued by the Attorney General of the United
States (Immigration and Naturalization Service) or (D)
aliens who have been continually employed by the Company
since November 6, 1986, or the applicable date of hire. The
Company has not been the subject of an immigration
compliance or employment visit from, nor has the Company
been assessed any fine or penalty by, or been the subject of
any order or directive of, the United States Department of
Labor or the Attorney General of the United States
(Immigration and Naturalization Service).
(r) Employee Benefits.
------------------
(i) The Disclosure Schedule sets forth a list
identifying each "employee pension benefit plan" as defined
in Section 3(2) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), including any "multi-
employer plan," as defined in Section 3(37) of ERISA, (the
"PENSION PLANS") and a list identifying each "employee
welfare benefit plan," as defined in Section 3(1) of ERISA,
(the "WELFARE PLANS") that, in either case, are maintained,
administered or contributed to by Seller or the Company with
respect to employees of the Company, or which cover any
employee or former employee of the Company. Collectively,
the Pension Plans and Welfare Plans are hereinafter referred
19<PAGE>
<PAGE>
to as the "EMPLOYEE PLANS". Except as otherwise identified
on the Disclosure Schedule, (A) no Employee Plan is
maintained, administered or contributed to by any entity
other than the Company, Seller or JWGFC, and (B) no Employee
Plan is maintained under any trust arrangement which covers
any employee benefit arrangement which is not an Employee
Plan.
(ii) Seller has delivered or has caused to be delivered
to Fiserv or Buyer true and complete copies of (A) the
Employee Plans (including related trust agreements,
custodial agreements, insurance contracts, investment
contracts and other funding arrangements, if any, and
adoption agreements, if any), (B) any amendments to Employee
Plans, (C) written interpretations of the Employee Plans,
(D) material employee communications by the plan
administrator of any Employee Plan (including, but not
limited to, summary plan descriptions and summaries of
material modifications, as defined under ERISA), (E) the
three most recent annual reports (e.g., the complete Form
5500 series) prepared in connection with each Employee Plan
(if any such report was required), including all attachments
(including without limitation the audited financial
statements, if any) and (F) the three most recent actuarial
valuation reports prepared in connection with each Employee
Plan (if any such report was required).
(iii) There has been no amendment to, written
interpretation or announcement (whether or not written) by
Seller or the Company relating to, or change in employee
participation or coverage under any Employee Plan that would
increase materially the expense of maintaining such Employee
Plan above the level of expense incurred in respect of such
Employee Plan for the most recent plan year with respect to
Employee Plans. The execution of this Agreement and the
consummation of the transactions contemplated hereby do not
and will not constitute an event under any Employee Plan,
which either alone or upon the occurrence of a subsequent
event will or may result in any payment, acceleration,
vesting or increase in benefits to any employee, former
employee or director of Seller or the Company.
(iv) Each Employee Plan has been maintained in all
material respects in compliance with its terms and the
requirements prescribed by any and all statutes, orders,
rules and regulations, including but not limited to, ERISA
and the Code, which are applicable to such Employee Plan.
(v) Each Pension Plan is "qualified" within the
meaning of Section 401(a) of the Code, and has been
qualified during the period from the date of its adoption to
the date of this Agreement, and each trust created
thereunder is tax-exempt under Section 501(a) of the Code.
Seller has delivered or caused to be delivered to Fiserv or
Buyer the latest determination letters of the Internal
Revenue Service relating to each Pension Plan. Such
20<PAGE>
<PAGE>
determination letters have not been revoked. Furthermore,
there are no pending proceedings or, to the knowledge of
JWGFC, Seller or the Company, threatened proceedings in
which the "qualified" status of any Pension Plan is at issue
and in which revocation of the determination letter has been
threatened. Each such Pension Plan has not been amended or
operated, since the receipt of the most recent determination
letter, in a manner that would adversely affect the
"qualified" status of the Plan. No distributions have been
made from any of the Pension Plans that would violate in any
respect the restrictions under Treas. Reg. Section
1.401(a)(4)-5(b), and none will have been made by the
Closing Date.
(vi) There are no pending or, to the knowledge of
JWGFC, Seller or the Company, threatened (A) claims, suits
or other proceedings by any employees, former employees or
plan participants or the beneficiaries, spouses or
representatives of any of them, other than ordinary and
usual claims for benefits by participants or beneficiaries,
or (B) suits, investigations or other proceedings by any
federal, state, local or other governmental agency or
authority, of or against any Employee Plan, the assets held
thereunder, the trustee of any such assets, or Seller and/or
Company relating to any of the Employee Plans. If any of
the actions described in this subsection are initiated prior
to the Closing Date, Seller shall notify Fiserv or Buyer in
writing of such action prior to the Closing Date.
(vii) Seller has not engaged (A) in any transaction or
acted or failed to act in a manner that violates the
fiduciary requirements of Section 404 of ERISA, or (B) in
any "prohibited transaction" within the meaning of Section
406(a) or 406(b) of ERISA, or of Section 4975(c) of the
Code, with respect to any Employee Plans, and will not so
engage, act or fail to act prior to the Closing Date.
Furthermore, to the knowledge of Seller, no other "party in
interest," as defined in Section 3(14) of ERISA, or
"disqualified person," as defined in Section 4975(e)(2) of
the Code, has engaged in any such "prohibited transaction".
(viii) No liability has been incurred by Seller or by
a trade or business, whether or not incorporated, which is
deemed to be under common control or affiliated with Seller
within the meaning of Section 4001 of ERISA or Section
414(b), (c), (m) or (o) of the Code (an "ERISA AFFILIATE")
for any tax, penalty or other liability with respect to any
Employee Plan and, to the knowledge of JWGFC, Seller or the
Company, such Plans do not expect to incur any such
liability prior to the Closing Date.
(ix) Seller and/or Company has made all required
contributions under each Pension Plan on a timely basis or,
if not yet due, adequate accruals therefor have been
provided for in the financial statements. No Pension Plan
21<PAGE>
<PAGE>
has incurred any "accumulated funding deficiency" within the
meaning of Section 302 of ERISA or Section 412 of the Code
and no Pension Plan has applied for or received a waiver of
the minimum funding standards imposed by Section 412 of the
Code.
(x) Except for required premium payments, no liability
to the Pension Benefit Guaranty Corporation (the "PBGC") has
been incurred by Seller and/or Company with respect to any
Pension Plan that has not been satisfied in full, and no
event has occurred and there exists no condition or set of
circumstances that could result in the imposition of any
such liability. Seller and/or the Company has complied, or
will comply, with all requirements for premium payments,
including any interest and penalty charges for late payment,
due to PBGC on or before the Closing Date with respect to
each Pension Plan for which any premiums are required. No
proceedings to terminate, pursuant to Section 4042 of ERISA,
have been instituted or, to the knowledge of JWGFC, Seller
or the Company, are threatened by the PBGC with respect to
any Pension Plan (or any Pension Plan maintained by an ERISA
Affiliate). There has been no termination or partial
termination, as defined in Section 411(d) of the Code and
the regulations thereunder, of any Pension Plan. No
reportable event, within the meaning of Section 4043 of
ERISA, has occurred with respect to any Pension Plan.
(xi) As of the date of this Agreement, with respect to
each Pension Plan which is covered by Title IV of ERISA and
which is not a multiemployer plan, the current value of the
accumulated benefit obligations (based on the actuarial
assumptions that would be utilized upon termination of such
Pension Plan) do not exceed the current fair value of the
assets of such Pension Plan. Except as listed in the
Disclosure Schedule, there has been (A) no material adverse
change in the financial condition of any such Pension Plan,
(B) no material change in actuarial assumptions with respect
to any such Pension Plan and (C) no increase in benefits
under any such Pension Plan as a result of plan amendment,
written interpretations, announcements, change in applicable
law or otherwise which, individually or in the aggregate,
would result in the value of any such Pension Plan's accrued
benefits exceeding the current value of such Pension Plan's
assets.
(xii) Neither Seller, Company nor any ERISA Affiliate
has ever maintained, adopted or established, contributed or
been required to contribute to, or otherwise participated or
been required to participate in, nor will they become
obligated to do so through the Closing Date, any
"multiemployer plan" (as defined in Section 3(37) of ERISA).
No amount is due from, or owed by, Seller, Company or any
ERISA Affiliate on account of a "multiemployer plan" (as
defined in Section 3(37) of ERISA) or on account of any
withdrawal therefrom.
22<PAGE>
<PAGE>
(xiii) No Employee Plan provides benefits, including
without limitation, any severance or other post-employment
benefit, salary continuation, termination, death,
disability, or health or medical benefits (whether or not
insured), life insurance or similar benefit with respect to
current or former employees (or their spouses or dependents)
of Seller or Company beyond their retirement or other
termination of service other than (A) coverage mandated by
applicable law, (B) death, disability or retirement benefits
under any Pension Plan, (C) deferred compensation benefits
accrued as liabilities on the financial statements of Seller
or Company, (D) benefits, the full cost of which is borne
by the current or former employee (or his or her
beneficiary) or (E) as expressly contemplated by this
Agreement.
(xiv) Seller and Company each has complied with, and
satisfied, the requirements of Part 6 of Subtitle B of Title
I of ERISA and Section 4980(B) of the Code, and all
regulations thereunder ("COBRA") with respect to each
Employee Plan that is subject to the requirements of COBRA.
Each Employee Plan that is a group health plan, within the
meaning of Section 9832(a) of the Code, has complied with
and satisfied the applicable requirements of Section 9801
and 9802 of the Code.
(s) Insurance. The Disclosure Schedule summarizes the
---------
amount and kinds of insurance as to which the Company has
insurance policies or contracts relating the business or
operations of the Company. All such insurance policies and
contracts are in, and from the date hereof until the Closing Date
or such other date as may be agreed by the parties shall be
maintained by the Company or Seller in, full force and effect.
No notice of cancellation or termination of any such insurance
policies or contracts has been given to the Company by the
carrier of any such policy.
(t) Bank Accounts. The Disclosure Schedule lists all bank,
-------------
money market, savings and similar accounts and safe deposit boxes
of the Company specifying the account numbers and the authorized
signatories of persons having access to them.
(u) Taxes.
------
i) Seller (A) has filed or caused to be filed with the
appropriate Taxing authorities on a timely basis all Tax
Returns relating to the Company and its assets, payroll,
business and operations (collectively "RELATING TO THE
COMPANY"), and properly included the items related thereto
in such Tax Returns, which Tax Returns are true, correct and
complete in all material respects, and (B) has paid or
caused to be paid to the appropriate authorities on a timely
basis all Taxes with respect thereto that are due and
payable on or before the date hereof and has properly
accrued on the Company's books and records in accordance
with GAAP all Taxes payable by or relating to the Company
23<PAGE>
<PAGE>
that are not yet due. The reserves for Taxes as set forth
on the Company Financial Statements are adequate for the
payment of all Taxes on or relating to the Company incurred
through the date hereof that have not been paid in full.
The Company has duly and timely complied in all material
respects with all applicable laws, rules and regulations
relating to the reporting, payment, collection and
withholding of all Taxes through and including the date
hereof and has within the time and in the manner prescribed
by law, collected or withheld and timely paid over to the
appropriate Taxing authorities all amounts required to be so
collected or withheld and paid over under all applicable
laws. Except as set forth on the Disclosure Schedule, to
the knowledge of JWGFC, Seller or the Company, all taxable
years or periods for the assessment of Taxes of or relating
to the Company (including without limitation assessments
relating to consolidated Federal income Tax Returns and
consolidated, combined, or unitary state or local income or
franchise Tax Returns of Seller which include or relate to
the Company) are closed either by agreement with the
applicable Taxing Authority (as defined below) or by
operation of the applicable statute of limitations or, if
not yet closed, will close by operation (without extension)
of any applicable statute of limitations for such Tax
Returns not requiring a determination of omissions, fraud or
other special facts other than the filing of a Tax Return.
The Disclosure Schedule lists each jurisdiction in which the
Company has filed (or is included in a Tax Return),
including the tax period and the type of Tax.
(ii) Except as set forth on the Disclosure Schedule:
(a) no Taxing authority has asserted any adjustment that
would result in any additional Tax on or relating to the
Company or for which the Company is or may be liable; (b)
there is not any pending or proposed audit, examination,
investigation, dispute, proceeding or claim (collectively,
"PROCEEDING") relating to any Tax on or relating to the
Company or for which the Company is or may be liable, and to
the knowledge of JWGFC, Seller or the Company, no Taxing
Authority is contemplating any such Proceeding and there is
no basis for any such Proceeding; (c) no statute of
limitations with respect to any Tax on or relating to the
Company has been waived or extended; (d) there is no
outstanding power of attorney authorizing anyone to act on
behalf of the Company in connection with any Tax on or
relating to the Company or any Proceeding with respect
thereto; (e) there is no outstanding closing agreement,
ruling request, subpoena request for information with or by
any Taxing authority with respect to any Tax on or relating
to the Company; and (f) the Company is not a party to any
Tax sharing or Tax allocation agreements, arrangement or
understanding.
(iii) The Company is not a party to any agreement,
arrangement or understanding that would result, individually
or in the aggregate, in the payment of any amount that would
not be deductible by reason of Section 162, 280G or 404 of
24<PAGE>
<PAGE>
the Code (or any similar provision of applicable law). The
Company does not have any "tax-exempt bond-financed
property" or "tax-exempt use property" within the meaning of
Section 168(g) or (h), respectively, of the Code (or any
similar provision of applicable law). The Company has not
entered into any sale-leaseback, capital lease or leveraged
lease transactions. None of the assets of the Company is
required to be treated as owned by another person pursuant
to the "safe harbor" leasing provisions of Section
168(f)(8)of the Internal Revenue Code of 1954, as amended,
as in effect immediately prior to the repeal of said leasing
provisions.
(iv) There are no liens for Taxes on any asset or
property of the Company.
(v) At all times beginning on and after June 12, 1998,
JWGFC has been the common parent of the affiliated group of
corporations within the meaning of Section 1502 of the Code
which includes the Company. For each Tax year during such
period, such affiliated group filed a consolidated Federal
income Tax Return and state combined, consolidated or
unitary Tax Return for California and Florida. At all times
beginning on and after January 1, 1993, until June 12, 1998,
Seller was the common parent of the affiliated group of
corporations within the meaning of Section 1502 of the Code
which includes the Company. For each Tax year during such
period, such affiliated group filed a consolidated Federal
income Tax Return and state combined, consolidated or
unitary Tax Return for California and Florida. Except as set
forth in this subparagraph (v), the Company has never been
included or required to be included in any consolidated,
combined or unitary Tax Return and since December 31, 1998,
has not declared, made or become obligated for any payments
under any Tax sharing or Tax allocation agreement or
understanding.
(vi) Seller is eligible to make a valid election under
Section 338(h)(10) of the Code with respect to the sale of
the Shares to Buyer pursuant to this Agreement.
(vii) For purposes of this Agreement, "TAX" or "TAXES"
shall mean all federal, state, local and foreign taxes,
charges, fees, levies, deficiencies or other assessments
imposed by any Taxing Authority (as defined below) of
whatever kind or nature (including, without limitation, all
net income, gross income, gross receipts, sales, use, ad
valorem, service, value-added, transfer, franchise, profits,
license, privilege, withholding, payroll, employment,
unemployment, excise, estimated accumulated earnings,
severance, stamp, occupation, real property, personal
property, intangible property, occupancy, recording,
minimum, environmental, windfall profits or other taxes,
customs, duties, fees, assessments or charges of any kind
25<PAGE>
<PAGE>
whatsoever), including any liability therefor as a
transferee (including without limitation under Section 6901
of the Code), as a result of Treasury Regulation Section
1.1502-6, or in each case, any similar provision under
applicable law, or as a result of any Tax sharing or similar
agreement, together with any interest, penalties, additions
to tax or additional amounts imposed in connection
therewith.
(viii) As used herein, "TAX RETURN" includes any re-
turn, declaration, report, claim for refund or credit,
information return or statement, and any amendment thereto,
including without limitation any consolidated, combined or
unitary return or other document (including any related or
supporting information or schedule), filed or required to be
filed with any federal, state, local or foreign government
or subdivision, agency or entity thereof (each a "TAXING
AUTHORITY") in connection with the determination,
assessment, collection or payment of Taxes or the
administration of any laws, regulations or administrative
requirements relating to Taxes.
(ix) As used in this Section 2.01(u) and Article VI,
where appropriate, "SELLER" shall include any common parent
of the consolidated, combined or unitary group of which
Seller is a member and all other members of such
consolidated, combined and/or unitary group.
(v) Brokers. All negotiations relative to this Agreement
-------
and the transactions contemplated hereby have been carried out by
the Company, JWGFC and the Seller directly with Fiserv and Buyer,
without the intervention of any other person or entity on behalf
of the Company, JWGFC or Seller in such manner as to give rise to
any valid claim by any other person or entity against the Compa-
ny, JWGFC or Seller for a finder's fee, brokerage commissions,
compensation or any other payment (other than employees of JWGFC
or the Seller with respect to possible bonus or similar
compensation, all of which shall be the sole liability of JSGFC
and/or Seller).
(w) Filings. JWGFC, Company or Seller previously has
-------
furnished or made available to Fiserv or Buyer with true, correct
and complete copies of all reports and documents respecting the
Company that were required to be prepared and filed, or caused to
be prepared and filed, with the SEC, NYSE, AMEX, NASD, all other
federal authorities and all state securities authorities for or
relating to calendar year 1998 and all time periods since
December 31, 1998. When prepared and filed, all such documents
were true, complete, correct and not misleading, and no fact was
omitted from any of same which fact was necessary in order to
make the statements made, in the light of the circumstances under
which they were made, not misleading.
SECTION 2.02 Representations and Warranties of the Seller.
---------------------------------------------
Seller for itself only, represents and warrants to, and agrees with,
Fiserv and Buyer as follows:
26<PAGE>
<PAGE>
(a) Organization and Qualification, etc. Seller is a
------------------------------------
corporation duly organized, validly existing and in good standing
under the laws of the State of Florida, has corporate power and
authority to own all of its properties and assets and to carry on
its business as it is now being conducted, and is duly qualified
to do business and is in good standing in each jurisdiction
where, to the reasonable belief of Seller, such qualification is
appropriate to the Company and the failure to so qualify would
have an Adverse Effect.
(b) Authority Relative to Agreement. Seller has the
-------------------------------
corporate power and authority to execute and deliver this
Agreement, and to consummate all of the transactions contemplated
on the part of Seller hereby. No other legally required
proceedings of any kind on the part of Seller are necessary to
authorize the execution and delivery of this Agreement by Seller
or the consummation by Seller of all of the transactions
contemplated hereby. This Agreement has been duly executed and
delivered by Seller and, assuming the due authorization,
execution and delivery of this Agreement by Buyer and Fiserv is a
valid and binding agreement of Seller, enforceable against Seller
in accordance with its terms, except as such enforcement is
subject to the effect of (i) any applicable bankruptcy,
insolvency, reorganization or similar Laws relating to or
affecting creditors' rights generally and (ii) general principles
of equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing, and
other similar doctrines affecting the enforceability of
agreements generally (regardless of whether considered in a
proceeding in equity or at law).
(c) Non-Contravention. The execution and delivery of this
-----------------
Agreement does not, and the consummation by Seller of the
transactions contemplated hereby will not, except where such
violation, conflict or termination would not have an Adverse
Effect, (i) violate, or result, with or without the giving of
notice or the lapse of time or both, in a violation of, any
provision of, or result in the acceleration of or entitle any
person or entity to accelerate (whether after the giving of
notice or lapse of time or both) any obligation under any
mortgage, lien, lease, agreement, license, instrument, law,
ordinance, regulation, order, arbitration award, judgment or
decree to which Seller is a party or by which any of its
properties or assets is bound and do not and will not violate or
conflict with any other restriction of any kind or character to
which Seller is subject or by which any of its properties or
assets may be bound, and the same does not and will not
constitute an event permitting termination of any mortgage, lien,
lease, agreement, license or instrument to which Seller is a
party, or (ii) violate any law, ordinance or regulation to which
Seller is subject, except, in each case or cases, for any such
violation, acceleration, creation, imposition, conflict or termi-
nation which would not prevent or affect adversely the consum-
mation of the transactions contemplated hereby and thereby.
(d) Government and Other Approvals. No consent, authoriza-
------------------------------
tion, order or approval of, or filing or registration with, any
governmental agency, commission, board or other regulatory body,
27<PAGE>
<PAGE>
securities authority or securities self regulatory organization,
including but not limited to the SEC, NYSE, AMEX and NASD, is
required for the execution and delivery of this Agreement by the
Seller and the Company and the consummation by the Seller and the
Company of the transactions contemplated hereby, except (i) for
filings with the Commission and the Antitrust Division under the
HSR Act, and the termination of the requisite waiting period
thereunder, (ii) where the failure to obtain such consents,
authorizations or approvals or to make such filings or
registrations would not prevent the consummation of the
transactions contemplated hereby, (iii) filings with or approvals
by the NYSE or NASD relating to the change in control of the
Company from Seller to Buyer as contemplated by this Agreement,
or (iv) as may be necessary as a result of any facts or
circumstances relating solely to Buyer.
(e) Transfer of Shares. Seller is now and on the Closing
------------------
Date shall be the lawful owner of all of the Shares, free and
clear of all liens, charges, encumbrances and any claims
whatsoever other than such restrictions as generally arise under
applicable securities laws, and the sale, transfer and delivery
of all said Shares to Buyer pursuant to the provisions of this
Agreement shall transfer to Buyer full and valid title thereto,
free and clear of all liens, charges, encumbrances and claims
whatsoever.
SECTION 2.03 Representations and Warranties of Fiserv and Buyer.
---------------------------------------------------
Fiserv and Buyer, jointly and severally, represent and
warrant to, and agree with, the Company and Seller as follows:
(a) Organization and Qualification, etc. Buyer is a
------------------------------------
corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware and has corporate power
and authority to own all of its properties and assets and to
carry on its business as it is now being conducted. Buyer is
duly qualified to do business and is in good standing in each
jurisdiction where the failure to be so qualified would have a
Material Adverse Effect.
(b) Authority Relative to Agreement. Each of Fiserv and
-------------------------------
Buyer has the corporate power and authority to execute and
deliver this Agreement and to consummate the transactions
contemplated on its part hereby. The execution and delivery by
each of Fiserv and Buyer of this Agreement and the consummation
by it of the transactions contemplated on its part hereby have
been duly authorized by its Board of Directors. No other
corporate or other proceedings or authorizations on the part of
Buyer are necessary to authorize the execution and delivery of
this Agreement by Buyer or Fiserv or the consummation by it of
the transactions contemplated hereby. This Agreement has been
duly executed and delivered by each of Fiserv and Buyer and,
assuming the due authorization, execution and delivery of such
agreements by the other parties thereto, is its valid and binding
agreement, enforceable against it in accordance with its terms,
except as such enforcement is subject to the effect of (i) any
applicable bankruptcy, insolvency, reorganization or similar laws
28<PAGE>
<PAGE>
relating to or affecting creditors' rights generally and (ii)
general principles of equity, including, without limitation, con-
cepts of materiality, reasonableness, good faith and fair
dealing, and other similar doctrines affecting the enforceability
of agreements generally (regardless of whether considered in a
proceeding in equity or at law).
(c) Non-Contravention. The execution and delivery of this
-----------------
Agreement by Buyer and Fiserv do not and the consummation by
Buyer and Fiserv of the transactions contemplated hereby will not
(i) violate any provision of their respective Articles or
Certificate of Incorporation or By-Laws, or (ii) violate, or
result, with or without the giving of notice or the lapse of time
or both, in a violation of, any provision of, or result in the
acceleration of or entitle any person or entity to accelerate
(whether after the giving of notice or lapse of time or both) any
obligation under, or result in the creation or imposition of any
material lien, charge, pledge, security interest or other
encumbrance upon any of the property or assets of either of them
pursuant to any provision of, any mortgage, lien, lease,
agreement, license, instrument, order, arbitration award,
judgment or decree to which either of them is a party or by which
any of its assets or property is bound and do not and will not
violate or conflict with any other material restriction of any
kind or character to which either of them is subject or by which
any of its assets or property may be bound, and the same does not
and will not constitute an event permitting termination of any
such mortgage, lien, lease, agreement, license or instrument to
which either of them is a party or (iii) violate in any material
respect any law, ordinance or regulation to which Buyer or Fiserv
is subject, except, in each case or cases, for any such
violation, acceleration, creation, imposition, conflict or
termination which would not prevent the consummation of the
transactions contemplated hereby by either of them.
(d) Government and Other Approvals. No consent,
------------------------------
authorization, order or approval of, or filing or registration
with, any governmental commission, board or other regulatory
body, securities authority or securities self-regulatory
organization is required for or in connection with the execution
and delivery of this Agreement by Buyer and the consummation by
Buyer and Fiserv of the transactions contemplated hereby, except
(i) for filings with the Commission and the Antitrust Division
under the HSR Act, and the termination of the requisite waiting
period thereunder, (ii) where the failure to obtain such
consents, authorizations or approvals or to make such filings or
registrations would not prevent the consummation of the
transactions contemplated hereby, (iii) filings with or approvals
by the NYSE or NASD relating to the change in control of the
Company from Seller to Buyer as contemplated by this Agreement,
or (iv) as may be necessary as a result of any facts or
circumstances relating solely to Seller.
(e) Brokers. All negotiations relative to this Agreement
-------
and the transactions contemplated hereby have been carried out by
Buyer directly with the Seller and the Company, without the
intervention of any person or entity on behalf of Buyer in such
29<PAGE>
<PAGE>
manner as to give rise to any valid claim by any person or entity
against Buyer for a finder's fee, brokerage commission,
compensation or any other payment.
ARTICLE III
ADDITIONAL COVENANTS AND AGREEMENTS
SECTION 3.01 Conduct of Business. During the period from
-------------------
the date hereof to the Closing Date, except as otherwise expressly
permitted by this Agreement, JWGFC and Seller shall cause the Company
to, and the Company shall, conduct all of its operations according to
its ordinary and usual course of business and preserve substantially
intact its business organization, keep available the services of all
of its officers, employees, contractors and agents, and maintain all
of its present relationships with all correspondents/introducing
broker dealers, licensors, suppliers, distributors, customers, clients
and all others having significant or strategic business relationships
with it. Representatives of the Company shall confer with representa-
tives of Fiserv and Buyer to keep them informed with respect to the
status of all on-going operations of the business of the Company.
SECTION 3.02 Access to Information by Fiserv and Buyer.
-----------------------------------------
Fiserv and Buyer shall have full access during reasonable business
hours to the business and properties of the Company and full
information concerning its financial, information technology,
commercial and legal condition as Fiserv and Buyer deem necessary or
advisable in connection with the consummation of the transactions
contemplated hereby (and, with respect to JWGFC and Seller, access to
similar such items and information of JWGFC or Seller as Fiserv and
Buyer shall reasonably request as being related to the Company and
their investigations of the Company), provided that such access in any
such case shall not interfere unreasonably with normal operations of
JWGFC, Seller and the Company. JWGFC, Seller and the Company agree to
permit Fiserv and Buyer or their authorized representatives, including
Deloitte & Touche LLP, or cause them to be permitted to have, after
the date hereof, access (as described above) to the respective
premises, books, records and accounts of the Company, JWGFC and
Seller during normal business hours, and the officers of the Company,
JWGFC and Seller shall furnish Fiserv and Buyer with all such
financial and operating data and other information with respect to the
business and properties of the Company, JWGFC and Seller as Fiserv and
Buyer shall from time to time reasonably request. No investigation by
Fiserv and Buyer heretofore or hereafter made shall affect the
representations and warranties of JWGFC, Seller and the Company, and
each such representation and warranty shall survive any such
investigation, provided, however, that in the event that as a result
of any such investigation the executive officers of Fiserv and Buyer,
or such attorneys and accountants as the executive officers of Fiserv
and Buyer shall designate to conduct such investigation, shall receive
notice of material facts which, based on information actually known to
them, they shall reasonably determine would be, or reasonably might
be, required to be disclosed in the Disclosure Schedule and are not so
disclosed, Fiserv and Buyer will use reasonable efforts to inform
30<PAGE>
<PAGE>
Seller in writing, JWGFC and the Company of such material facts and,
upon such notification as appropriate, Seller, JWGFC and the Company
(if such notice occurs prior to the Closing) shall amend the
Disclosure Schedule accordingly, and provided, further, however, that
neither Fiserv nor Buyer nor any such officers, attorneys or accoun-
tants shall have any obligation to make any inquiry in respect of the
foregoing.
SECTION 3.03 Confidentiality.
---------------
(a) JWGFC and Seller each covenants and agrees for itself
and all of its subsidiaries and affiliates (now and in the
future), and for all of the directors, officers, employees,
contractors and agents of same, that, for a period of two years
following the Closing, it shall hold all Confidential Information
(as hereinafter defined) concerning the Company and concerning
Fiserv and Buyer received, accessed or contacted by JWGFC or
Seller from or related to Fiserv and Buyer in connection
herewith, not use itself or voluntarily disclose to others any
such information, promptly return upon request every document
furnished by Fiserv and Buyer in connection herewith (if not
previously destroyed) and any copies thereof it may have made and
to destroy all summaries, compilations or similar documents (in
any form whatsoever) it may have made or derived from such
material, and have all of its representatives (as specified
above) promptly return such documents and copies and destroy such
summaries, compilations or similar documents and otherwise comply
with this Section 3.03. JWGFC and Seller each further covenants
and agrees for itself, and all of its subsidiaries and affiliates
(now and in the future), and for all of the directors, officers,
employees, contractors and agents of same, that it shall keep
confidential and not use at any time any trade secrets of the
Company or Fiserv and Buyer. Notwithstanding the foregoing,
JWGFC and Seller shall not be restricted from using in their
respective businesses any information or trade secrets currently
being used by them in such businesses that are not part of the
business of the Company.
(b) Until the Closing of the transactions contemplated
herein, all Confidential Information acquired by Fiserv and Buyer
with respect to the Company shall be (i) maintained in strict
confidence, (ii) used only for the purpose of and in connection
with evaluating the transactions contemplated herein, and (iii)
disclosed only to employees and duly authorized agents and
representatives of Fiserv and Buyer who have been informed of the
obligations of Fiserv and Buyer under this Section 3.03 or any
other agreement with respect to such Confidential Information,
have a need to know the information in connection with
consummating the transactions contemplated herein, agree to keep
such information confidential and agree to be bound by the terms
hereof to the same extent as if they were parties hereto. Fiserv
and Buyer shall be responsible for any breach of this Section
3.03(b) by any of its representatives and agree to take all
reasonable measures to restrain its representatives from
prohibited or unauthorized disclosure of the Confidential
Information.
31<PAGE>
<PAGE>
(c) Fiserv and Buyer each covenants and agrees for itself
and all of its subsidiaries and affiliates (now and in the
future), and for all of the directors, officers, employees,
contractors and agents of same, that, for a period of two years
following the Closing, it shall hold all Confidential Information
(as hereinafter defined) concerning the JWGFC or Seller received,
accessed or contacted by Fiserv or Buyer from or related to JWGFC
or Seller in connection herewith, not use itself or voluntarily
disclose to others any such information, promptly return upon
request every document furnished by JWGFC or Seller in connection
herewith (if not previously destroyed) and any copies thereof it
may have made and to destroy all summaries, compilations or
similar documents (in any form whatsoever) it may have made or
derived from such material, and have all of its representatives
(as specified above) promptly return such documents and copies
and destroy such summaries, compilations or similar documents and
otherwise comply with this Section 3.03. Fiserv and Buyer each
further covenants and agrees for itself, and all of its
subsidiaries and affiliates (now and in the future), and for all
of the directors, officers, employees, contractors and agents of
same, that it shall keep confidential and not use at any time any
trade secrets of JWGFC or Seller. Notwithstanding the foregoing,
Fiserv and Buyer shall not be shall not be restricted from using
in their respective businesses any information or trade secrets
currently being used by them in such businesses.
(d) For the purpose of this Agreement, the term
"CONFIDENTIAL INFORMATION" shall mean all confidential or
proprietary information acquired, accessed or contacted by the
parties with respect to the other parties' operations or business
(other than any information which (i) becomes generally available
to the public through no breach of this Agreement, (ii) was
available on a non-confidential basis prior to its disclosure or
(iii) becomes available on a non-confidential basis from a source
other than any party to this Agreement that is not prohibited
from disclosing such information by a contractual, legal or
fiduciary obligation). If the transactions contemplated herein
are not consummated, all Confidential Information in written or
electronic or printed or in any other tangible form (whether
copies or originals) shall be returned to the party which
provided or made available the same, and all documents,
memoranda, notes and other writings whatsoever prepared by the
receiving parties or their representatives based on the
Confidential Information shall be destroyed.
SECTION 3.04 Non-Assignable Licenses, Leases and Contracts.
---------------------------------------------
JWGFC, Seller and the Company shall use all commercially reasonable
efforts to obtain and deliver to Buyer at or prior to the Closing all
such consents or waivers as are required in order that any contract
listed in the Disclosure Schedule which would be breached or violated,
32<PAGE>
<PAGE>
or would give any other party the right to cancel the same, as a
result of the occurrence of the Closing hereunder, shall not be so
breached or violated or result in such right of cancellation. JWGFC,
Seller and the Company shall use all commercially reasonable efforts
to obtain and deliver to Buyer at or prior to the Closing all such
consents or waivers as shall be reasonably requested by Fiserv or
Buyer for any contracts whether or not listed in the Disclosure
Schedule which, as a result of the occurrence of the Closing
hereunder, would be breached or violated or would give any other the
right to cancel the same, in order that all such contracts shall not
be so breached or violated or result in such right of cancellation.
Except as otherwise specifically listed in the Disclosure
Schedule, JWGFC, Seller and the Company represent and warrant that the
Closing shall not breach, violate or result in the cancellation of any
licenses, leases and contracts to which the Company, JWGFC or the
Seller is party for purposes of conducting the business and operations
of the Company.
SECTION 3.05 Exclusivity and Non-Competition.
--------------------------------
(a) Exclusivity With Respect to the Transactions
--------------------------------------------
Contemplated in this Agreement. JWGFC and Seller, and their
------------------------------
respective subsidiaries and affiliates (now and in the future),
and the Company, and the directors, officers, employees,
contractors or agents of same, shall not pursue, or engage in
with any persons or entities other than Fiserv and Buyer,
directly or indirectly, any discussions, negotiations or dealings
of any kind respecting the transactions contemplated in this
Agreement.
(b) Non-Competition. During the period commencing on the
---------------
Closing Date and ending on the tenth anniversary of the Closing
Date, JWGFC and Seller, and their respective subsidiaries and
affiliates (now and in the future), and all directors and
executive officers or other affiliates of same, shall not engage,
directly or indirectly, in any material respect in the business
of providing securities clearing, execution, back office and
related services.
(c) Non-Solicitation, etc. JWGFC and Seller, and their
---------------------
respective subsidiaries and affiliates (now and in the future),
and all directors and executive officers or other affiliates of
same, shall not directly or indirectly solicit for employment, or
advise or recommend to any other person or entity that they
employ or solicit for employment, any employee, contractor or
agent of the Company.
(d) Exclusivity of Securities Clearing Business;
--------------------------------------------
Termination of All Other Securities Clearing Agreements and
-----------------------------------------------------------
Relationships. On or before the first anniversary of the
-------------
Closing, JWGFC and Seller, for itself and respectively for all of
its current and future subsidiaries and affiliates where the
registered representatives are not independent contractors, shall
terminate or cause to be terminated all agreements and
relationships of any kind, oral or written, with any persons or
entities ("THIRD PARTY CLEARING FIRMS") other than the Company,
its successors or assigns (or any subsidiary or affiliate of
Fiserv as an authorized officer of Fiserv may designate in
writing), which relate in any way to the business of providing
securities clearing, execution, back office and related services.
For the full term of the Fully Disclosed Correspondent Agreements
specified in Section 4.01 (n), JWGFC and Seller shall ensure that
33<PAGE>
<PAGE>
it and all of its current and future subsidiaries and affiliates
where the registered representatives are not independent
contractors shall use only the Company, its successors or assigns
(or any subsidiary or affiliate of Fiserv as an authorized
officer of Fiserv may designate in writing), on an exclusive
basis, for the provision of securities clearing, execution, back
office and related services. Notwithstanding the preceding two
sentences, the parties recognize and agree that future
opportunities that are advantageous to JWGFC or the Seller (and,
because of the future business relationships among the parties
contemplated hereby, could become advantageous to Fiserv and
Buyer), may become available for JWGFC or Seller (or their
subsidiaries and affiliates (now and in the future)) to engage
new or additional registered representatives (or to acquire
businesses which have registered representatives) who are then
using one or more Third Party Clearing Firms for clearing
services. Accordingly, it shall not be a violation of this
Section 3.05 (d) for either (i) not more than 10% of the total
business produced by registered representatives who are not
independent contractors of JWGFC, Seller and their subsidiaries
and affiliates (now and in the future) calculated on a rolling 13
month-basis, to be cleared using the services of one or more
Third Party Clearing Firms; or (ii) during the 13-month period
following an acquisition by JWGFC, Seller or a subsidiary or
affiliate (now or in the future), for the business produced by
registered representatives who are not independent contractors
who join JWGFC, Seller or an affiliate as a result of the
acquisition to be cleared using the services of one or more Third
Party Clearing Firms provided, however, that by the end of said
13-month period JWGFC, Seller and their subsidiaries and
affiliates (now and in the future) shall come into compliance
with (d) (i) above.
(e) Additional Handling Charge. For the full term of the
--------------------------
Fully Disclosed Correspondent Agreements specified in Section
4.01 (n), JWGFC and/or Seller, for themselves and their
respective subsidiaries and affiliates (now or in the future),
shall impose a surcharge of 25% of the standard ticket charge
imposed by JWGFC, Seller or such subsidiary or affiliate for the
handling of all securities trading tickets of all independent
contractor registered representatives within JWGFC's and/or
Seller's ownership or control, directly or indirectly, who
utilize a Third Party Clearing Firm, on an exclusive basis, for
the provision of securities clearing, execution, back office and
related services; provided that it shall not be a violation of
this Section 3.05 (e) for (i) JWGFC, Seller and their respective
subsidiaries and affiliates (now or in the future) not to impose
such a surcharge on up to an aggregate of 10% of the business
34<PAGE>
<PAGE>
produced by such independent contractor registered
representatives who are engaged by JWGFC, Seller or their
respective subsidiaries and affiliates (now or in the future)
calculated on a rolling 13-month basis; or (ii) during the 13-
month period following an acquisition by JWGFC, Seller or their
respective subsidiaries and affiliates (now or in the future, for
the business produced by independent contractor registered
representatives who join JWGFC, Seller or their respective
subsidiaries and affiliates (now or in the future) as a result of
the acquisition to be cleared using the services of one or more
Third Party Clearing Firms, provided further, however, that by
the end of said 13-month period JWGFC, Seller and their
subsidiaries and affiliates (now and in the future) shall come
into compliance with (e) (i) above.
(f) For the purposes of this Agreement, an affiliate or
subsidiary of JWGFC shall mean any organization or entity of
which JWGFC has direct or indirect control of more than fifty
percent (50%) of such organization's or entity's voting
interests. Any organization or entity for which JWGFC has
indirect or direct control of less than or equal to fifty percent
(50%) of such organization's or entity's voting interests shall
not be considered an affiliate or subsidiary subject to the terms
and conditions of this Agreement.
JWGFC and Seller each agrees that all of the limitations and
provisions set forth above (including, without limitation, any
time or territorial limitations) are lawful, reasonable and
properly required for the adequate protection of the business of
the Company and Fiserv and Buyer, and shall be enforced as
written to the fullest extent permitted by law. In the event
that any territorial or time limitation is deemed to be
unreasonable by the final order of a court of competent jurisdic-
tion, JWGFC and Seller each agrees to the reduction of the terri-
torial or time limitation to the area or period which such court
in said order shall have deemed reasonable.
SECTION 3.06 Tax Returns.
------------
(a) JWGFC and Seller shall file or cause the Company to
duly and timely file all Tax Returns required to be filed by or
which include or relate to the Company with respect to all
periods ending on or before the Closing Date. The Company shall
be included in the consolidated Federal income Tax Return and
consolidated, combined or unitary state or local income or
franchise Tax Returns for all applicable states with JWGFC and/or
Seller for each such period. JWGFC and Seller shall cause the
Company to duly and timely pay all Taxes on or relating to the
Company required to be paid with respect to each Pre-Closing
Period (as defined below), and shall properly accrue on the
Company's books and records in accordance with GAAP all Taxes
payable by the Company which are not due on or before the Closing
Date. The reserve for Taxes on the Company's books and records
(and taken into account in computing the Final Stockholders'
Equity) shall be adequate for the payment of all Taxes on or
relating to the Company incurred or that may be incurred in each
Pre-Closing Period that have not been paid in full. Such Tax
Returns shall be true, correct and complete in all material
respects, shall be prepared on a basis consistent with prior Tax
35<PAGE>
<PAGE>
Returns and shall not make, amend or terminate any election by or
relating to the Company or change any accounting method, practice
or procedure without Fiserv's and Buyer's prior written consent.
JWGFC and Seller shall give Fiserv and Buyer a copy of each such
Tax Return, together with all related work papers, with
sufficient time for its review and comments prior to filing.
JWGFC and Seller shall cause the Company, up to and including the
Closing Date, to duly and timely comply in all material respects
with all applicable laws, rules and regulations relating to the
reporting, payment, collection and withholding of Taxes and
within the time and in the manner prescribed by law, to collect
or withhold and timely payover to the appropriate Taxing
authorities all amounts required to be so collected or withheld
and paid over under all applicable laws.
(b) JWGFC and Seller shall not take or fail to take (or
permit the Company or any subsidiary or affiliate to take or fail
to take) any action that could cause JWGFC, Seller or the Company
to cease being eligible to make a valid Election with respect to
the sale of Shares pursuant to this Agreement.
(c) Any Tax sharing or Tax allocation agreement,
arrangement or understanding to which the Company is a party (and
any obligations of or to the Company thereunder) shall be
terminated before the Closing Date without further liability to
the Company.
SECTION 3.07 Transition Services. For a period of twelve
-------------------
months from the Closing Date or for such other periods as agreed by
the parties (the "TRANSITION PERIOD"), JWGFC and Seller shall perform
or cause to perform on behalf of the Company during the Transition
Period all of the services specified in the Transition Services
Agreement attached hereto as Exhibit A (the "TRANSITION SERVICES
AGREEMENT"). The said services specified in the Transition Services
Agreement are referred to herein, collectively, as the "TRANSITION
SERVICES". In these regards, JWGFC, Seller and Company agree that on
or prior to Closing certain employees, contractors and agents of
JWGFC, the Seller and/or the Company (the names, positions and
functions of same shall be detailed in the Transition Services
Agreement) shall cease providing services on behalf of the Company as
employees, contractors or agents of JWGFC, the Seller and/or the
Company and, instead, shall become and serve as the employees,
contractors or agents of JWGFC and/or the Seller. The details, terms
and conditions of all such matters are contained in and governed
solely by the Transition Services Agreement.
SECTION 3.08 Additional Financial Statements. JWGFC and
-------------------------------
Seller shall cause to be prepared and shall deliver to Fiserv or Buyer
as soon as practicable after they have been prepared (but in no event
later than 20 days after the end of each month) unaudited monthly and
year-to-date financial statements of the Company (including a balance
sheet and statement of income before income taxes) for all months from
the month including the date of this Agreement until the Closing
Date), each certified by the chief financial officer of JWGFC and
Seller as being consistent with the Company's Financial Statements.
SECTION 3.09 Consents and Authorizations. As soon as
---------------------------
practicable after the date hereof, each of the parties shall commence
and continue to take until the Closing Date, all reasonable actions to
36<PAGE>
<PAGE>
file for, obtain and maintain in effect all notices, authorizations,
consents, orders and approvals of all third parties and of all
federal, state and local regulatory bodies and officials, and of all
securities authorities and entities including but not limited to the
SEC, NYSE, AMEX and NASD, which may be or become necessary for its
execution and delivery of, and its performance of, this Agreement. In
particular, but without limitation, JWGFC and Seller shall commence
and complete diligently all such necessary actions with the SEC, NYSE
and AMEX, and Company shall commence and complete diligently all such
necessary actions with the SEC, NYSE and NASD.
ARTICLE IV
CONDITIONS PRECEDENT
SECTION 4.01 Conditions Precedent to the Obligations of
------------------------------------------
Fiserv and Buyer. The obligations of Fiserv and Buyer under this
- ----------------
Agreement are subject to the satisfaction in all material respects or
waiver in writing by Fiserv and Buyer prior to or on the Closing Date
of each of the following conditions:
(a) Accuracy of Representations and Warranties. The
------------------------------------------
representations and warranties of JWGFC and Seller (for itself
and/or respecting the Company) contained in this Agreement, in
the Disclosure Schedule and in any closing certificate or
document delivered to Fiserv and Buyer pursuant hereto shall be
true and correct at and as of the Closing Date as though made at
and as of that time other than such representations and
warranties as are specifically made as of another date, and JWGFC
and Seller shall have delivered to Fiserv and Buyer a certificate
to that effect, including a schedule of all exceptions to any and
all of the representations and warranties that arose between the
date hereof and the Closing Date, provided that, as to any
representation or warranty that JWGFC or Seller can no longer
certify as accurate as of the Closing Date as a result of an
event or other development occurring after the date hereof and
which would not have an Adverse Effect, Fiserv and Buyer shall
not be entitled to refuse to close if JWGFC and Seller shall
disclose such event or development in an amendment to the
Disclosure Schedule and specifically agree fully to indemnify and
hold harmless Fiserv and Buyer with respect thereto pursuant to
Section 5.03.
Continuance of Company's Business and/or Revenues.
-------------------------------------------------
Beginning on the date when the parties sign this Agreement and up
to and through Closing, JWGFC, Seller and the Company shall
provide written notice to Fiserv and Buyer of any loss or
reduction of the Company's business and/or revenues due to the
termination or discontinuance (or notice thereof) by one or more
correspondents of such correspondent's clearing services
arrangements with the Company ("CORRESPONDENT TERMINATIONS"), and
provide written notice of all notice(s) or other communications
(whether written, electronic or oral) from any and all of the
Company's correspondents that any such termination or
37<PAGE>
<PAGE>
discontinuance is forthcoming or is under evaluation. Such
developments and information shall be handled as follows:
(i) If the actual or reasonably expected loss or reduction
of the total business and/or revenues of the Company due to
Correspondent Terminations is less than 5% of the same as of
the date on which the parties sign this Agreement, there
shall be no right of Fiserv and Buyer under this Section
4.01 (b) not to close the transaction described in this
Agreement and the Purchase Price shall not be adjusted based
on said actual or reasonably expected loss or reduction.
(ii) If the actual or reasonably expected loss or reduction
of the total business and/or revenues of the Company due to
Correspondent Terminations is equal to or greater than 5%
and up to and including 25% of the same as of the date on
which the parties sign this Agreement, there shall be no
right of Fiserv and Buyer under this Section 4.01 (b) not to
close the transaction described in this Agreement but
$40,000,000 of the Purchase Price shall be reduced
proportionately based on the percentage reduction of said
actual or reasonably expected loss or reduction within said
range.
(iii) If the actual or reasonably expected loss or reduction
of the total business and/or revenues of the Company due to
Correspondent Terminations is greater than 25% of the same
as of the date on which the parties sign this Agreement,
Fiserv and Buyer shall have the right at their option under
this Section 4.01 (b) not to close the transaction described
in this Agreement.
(c) Compliance with Covenants. JWGFC, Seller and the
-------------------------
Company shall have performed and complied with all covenants of
this Agreement to be performed or complied with by them at or
prior to the Closing Date (except where the failure to so perform
or comply would not have an Adverse Effect on Fiserv and Buyer or
prevent it or make it impracticable from consummating the
transactions contemplated hereby) and except where a cure for any
such technical non-performance or non-compliance by JWGFC,
Seller, or the Company has been effected by JWGFC, Seller, or the
Company and accepted by Fiserv and Buyer (such acceptance not to
be unreasonably withheld) at or prior to the Closing Date), and
JWGFC, Seller and the Company shall each have delivered to Fiserv
and Buyer a certificate to that effect.
(d) All Proceedings to be Satisfactory. Fiserv and Buyer
----------------------------------
shall have received certified or other copies of all documents
relating to JWGFC, Seller and the Company incident to the trans-
actions contemplated hereby as Fiserv and Buyer may reasonably
38<PAGE>
<PAGE>
request and such documents shall be reasonably satisfactory in
form and substance to Fiserv and Buyer.
(e) Opinion of Counsel for the Company. Fiserv and Buyer
----------------------------------
shall have received the favorable opinion of Kilpatrick Stockton
LLP of Atlanta, Georgia, dated the Closing Date, substantially in
the form and to the effect set forth in Exhibit B hereto.
(f) Legal Actions or Proceedings. No legal action or
----------------------------
proceeding shall have been instituted after the date hereof
against JWGFC, Seller or the Company, or against Fiserv and
Buyer, arising by reason of the acquisition of the Company
pursuant to this Agreement, which is reasonably likely (i) to
restrain, hamper materially, prohibit or invalidate the
consummation of the transactions contemplated by this Agreement,
(ii) to have a Material Adverse Effect on the Company or (iii) to
have a Material Adverse Effect on the results of operations or
financial condition of Fiserv and its subsidiaries, taken as a
whole, after giving effect to the consummation of the
transactions contemplated by this Agreement.
(g) Resignations of Directors. Fiserv and Buyer shall have
-------------------------
received the resignations of all the directors of the Company.
(h) Consents. JWGFC, Seller and the Company shall have
--------
obtained all of the consents, authorizations and approvals
necessary or reasonably desirable to effect the consummation of
the transactions contemplated by this Agreement, including those
set forth in Exhibit C hereto.
(i) HSR Act Waiting Period. The requisite waiting period
----------------------
under the HSR Act shall have expired.
(j) Non-Foreign Status. At the Closing, JWGFC, Seller and
------------------
the Company shall deliver to Fiserv and Buyer an affidavit of
non-foreign status, in the form required by Section 1445 of the
Code and the regulations thereunder, signed under penalties of
perjury. JWGFC and Seller each understands that its affidavit
will be retained by Fiserv and Buyer and will be made available
to the Internal Revenue Service upon request.
(k) Supporting Documents. On or prior to the Closing Date,
--------------------
Fiserv and Buyer shall have received copies of the following
supporting documents:
(i) (1) copies of the Articles of Incorporation of the
Company, and all amendments thereto, certified as of a
recent date by the Secretary of State of the State of Iowa
and (2) a certificate of said Secretary dated as of a recent
date as to the due incorporation and good standing of the
Company and listing all documents of the Company on file
with said Secretary;
39<PAGE>
<PAGE>
(ii) certificates of the Secretary or an Assistant
Secretary of the Company, as appropriate, dated the Closing
Date and certifying (1) that attached thereto is a true and
complete copy of the By-laws of the Company as in effect on
the date of such certification and at all times since
January 1, 1995; (2) that attached thereto is a true and
complete copy of all resolutions adopted by the Board of
Directors of the Company authorizing the execution, delivery
and performance of this Agreement and that all such resolu-
tions are still in full force and effect and are all the
resolutions adopted in connection with the transactions
contemplated by this Agreement; (3) that the Articles of
Incorporation of the Company have not been amended since the
date of the last amendment referred to in the certificate
delivered pursuant to clause (i) (2) above; and (4) as to
the incumbency and specimen signature of each officer of the
Company executing this Agreement and any certificate or
instrument furnished pursuant hereto, and a certificate by
another officer of the Company as to the incumbency and
signature of the officer signing the certificate referred to
in this paragraph (ii); and
(iii) a certificate of JWGFC, Seller and the Company
to the effect that the condition hereto set forth in
paragraph (g) hereof has been satisfied.
(l) Outstanding Stock Options. On or prior to Closing,
-------------------------
JWGFC, Seller and Company shall have exercised or terminated all
outstanding options for stock, if any, in Company and shall
certify the same to Fiserv and Buyer.
(m) Transition Services Agreement. On or prior to Closing,
------------------------------
Buyer, JWGFC and Seller shall have executed the Transition
Services Agreement that is described in Section 3.07 and attached
hereto as Exhibit A.
(n) Fully Disclosed Correspondent Agreements. On or prior
----------------------------------------
to Closing, Buyer (in its own capacity or in the name of the
Company based on Buyer's purchase of all of the Shares of the
Company, or through its wholly owned subsidiary Fiserv
Correspondent Services, Inc.) and all securities broker dealers
owned or controlled by JWGFC and Seller, directly or indirectly,
shall have executed Fully Disclosed Correspondent Agreements each
of which shall be for a term of ten years, include clearing
deposits and be substantially in the form attached hereto as
Exhibit D. All such securities broker dealers owned or controlled
by JWGFC and Seller are listed in Exhibit E hereto.
(o) On or prior to Closing, Fiserv and Buyer shall have
determined, in their reasonable discretion, that the Estimated
Balance Sheet (as specified in Section 1.03 (a)) is reasonable
and appropriate for Fiserv and Buyer to proceed to consummate the
transactions contemplated herein. In exercising their discretion
as provided in this Section 4.01 (o), Fiserv and Buyer shall
consider and evaluate whether the amount of Stockholders' Equity
that is specified in, and the manner in which that amount is
40<PAGE>
<PAGE>
calculated for purposes of, the Estimated Balance Sheet are
reasonable, appropriate and consistent with the parties' prior
and ongoing discussions respecting same. If Fiserv and Buyer
determine that the Estimated Balance Sheet is not reasonable,
appropriate and consistent with the parties' prior and ongoing
discussions respecting same, the Holdback shall be increased by
an additional sum of cash, equal to an amount specified by Fiserv
and Buyer, which is the total of the disputed item(s) or
amount(s) of the Stockholder's Equity as specified in the
Estimated Balance Sheet. Any such dispute shall be resolved
pursuant to Section 1.03 (b).
All such documents and agreements shall be reasonably
satisfactory in form and substance to Fiserv and Buyer and its
counsel.
SECTION 4.02 Conditions Precedent to the Obligations of Seller.
--------------------------------------------------
The obligations of Seller under this Agreement are subject to
the satisfaction in all material respects or waiver by Seller prior to
or on the Closing Date of each of the following conditions:
(a) Accuracy of Representations and Warranties. The repre-
------------------------------------------
sentations and warranties of Fiserv and Buyer contained in this
Agreement or in any closing certificate or document delivered to
Seller or the Company pursuant hereto shall be true and correct
on and as of the Closing Date as though made at and as of that
date other than such representations and warranties as are
specifically made as of another date, and Fiserv and Buyer shall
have delivered to Seller a certificate to that effect.
(b) Compliance with Covenants. Fiserv and Buyer shall have
-------------------------
performed and complied with all covenants of this Agreement to be
performed or complied with by Fiserv and Buyer at the Closing
Date (except where the failure to so perform or comply would not
have a Material Adverse Effect on Fiserv and Buyer or prevent it
from consummating the transactions contemplated hereby), and
Fiserv and Buyer shall have delivered to Seller a certificate to
such effect.
(c) All Proceedings to be Satisfactory. Seller and its
----------------------------------
counsel shall have received all such counterpart originals or
certified or other copies of all documents relating to Fiserv and
Buyer incident to the transactions contemplated hereby as Seller
or said counsel may reasonably request and such documents shall
be reasonably satisfactory in form and substance to Seller and
said counsel.
(d) Opinion of Counsel for Fiserv and Buyer. Seller and
---------------------------------------
the Company shall have received the favorable opinion of Charles
W. Sprague, Executive Vice President and General Counsel of
Fiserv and Buyer, dated the Closing Date, substantially in the
form and to the effect set forth in Exhibit F hereto.
41<PAGE>
<PAGE>
(e) Legal Actions or Proceedings. No legal action or
----------------------------
proceeding shall have been instituted that is reasonably likely
to restrain, prohibit, violate or otherwise affect materially the
consummation of the transactions contemplated hereby.
(f) HSR Act Waiting Period. The requisite waiting period
----------------------
under the HSR Act shall have expired.
(g) Consents. JWGFC, Seller and the Company shall have
--------
obtained all of the consents, authorizations and approvals
necessary or reasonably desirable to effect the consummation of
the transactions contemplated by this Agreement, including those
set forth in Exhibit C hereto.
(h) Supporting Documents. On or prior to the Closing Date,
--------------------
Seller, the Company and their counsel shall have received copies
of the following supporting documents:
(i) (1) copies of the Articles of Incorporation of
Buyer, and all amendments thereto, certified as of a recent
date by the Secretary of State of the State of Delaware and
(2) a certificate of said Secretary dated as of a recent
date as to the due incorporation and good standing of Buyer
and listing all documents of Buyer on file with said
Secretary; and
(ii) a certificate of the Secretary or an Assistant
Secretary of Buyer dated the Closing Date and certifying
(1) that attached thereto is a true and complete copy of the
By-laws of Buyer as in effect on the date of such
certification and at all times since December 31, 1998;
(2) that attached thereto is a true and complete copy of all
resolutions adopted by the Board of Directors of Buyer
authorizing the execution, delivery and performance of this
Agreement and that all such resolutions are still in full
force and effect and are all the resolutions adopted in
connection with the transactions contemplated by this
Agreement; (3) that the Certificate of Incorporation of
Buyer has not been amended since the date of the last
amendment referred to in the certificate delivered pursuant
to clause (i) (2) above; and (4) as to the incumbency and
specimen signature of each officer of Buyer executing this
Agreement and a certification by another officer of Buyer as
to the incumbency and signature of the officer signing the
certificate referred to in this paragraph (ii).
All such documents shall be reasonably satisfactory in form
and substance to Seller and its counsel.
ARTICLE V
41<PAGE>
<PAGE>
SURVIVAL OF REPRESENTATIONS; INDEMNIFICATION
SECTION 5.01 Survival. Subject to the limitations and
other provisions of this Agreement, the representations, warranties,
covenants and agreements of the parties hereto contained herein shall
survive the Closing and shall remain in full force and effect,
regardless of any investigation made by or on behalf of Fiserv and
Buyer or JWGFC and Seller, until April 30, 2001, or for such other
time period(s) as provided herein, except with respect to the
representations, warranties, covenants and agreements contained in
Section 2.01(u) or 3.06 of this Agreement, which shall survive as set
forth in Section 5.02(b)(iii).
SECTION 5.02 Indemnification for Taxes.
--------------------------
(a) Except to the extent taken into account in determining
the Final Stockholders' Equity (as finally determined), JWGFC and
Seller shall bear and pay when due, and shall fully indemnify
Fiserv and Buyer, the Company and their subsidiaries and
affiliates, and all directors, officers, employees, contractors
or agents of same, and hold them harmless on an after-Tax basis
from and against (i) any and all Taxes for which the Company (or
any predecessor company thereto) is or may be liable in respect
of (x) any period that ends on or before the Closing Date or (y)
with respect to a period that begins on or before and ends after
the Closing Date, the portion of such period, if any, through and
including the Closing Date (each such period or portion under
clause (x) or (y), a "PRE-CLOSING PERIOD"), (ii) the adverse
effect, if any, of the underlying adjustments on Fiserv, Buyer,
the Company or their subsidiaries and affiliates in any period
that ends after the Closing Date, (iii) any increased Tax on
Fiserv, Buyer the Company or their subsidiaries and affiliates in
any Tax period as a result of any breach of Section 1.06, Section
2.01 (u) (vi) or Section 3.06 (b) and (iv) in each case together
with all reasonable legal, accounting or other fees and expenses
incurred by Fiserv and Buyer, the Company or their subsidiaries
and affiliates in connection therewith or with enforcing their
rights hereunder.
(b) The indemnity provided for in this Agreement, (i) shall
apply notwithstanding any investigation made by Fiserv or Buyer
in connection with the transactions contemplated by this Agree-
ment, (ii) shall be separate and independent of any other indem-
nity provision contained herein and (iii) anything in this
Agreement to the contrary notwithstanding shall survive until two
months after the expiration of the applicable statute of
limitations, including extensions or waivers thereof, for any
such Taxes or other items.
(c) JWGFC and the Seller shall promptly forward to Fiserv
and Buyer a copy of all written communications from any Taxing
authority received by it or the Company that relates to any Tax
imposed on, or with respect to the Company. Fiserv and Buyer
43<PAGE>
<PAGE>
shall promptly forward to JWGFC and the Seller a copy of all
written communications from a Taxing authority received by it
that relates to any Taxes imposed on or with respect to the
Company, in any Pre-Closing Period.
(d) Fiserv and Buyer agree not to settle or make any
payment of an amount claimed to be due with respect to a proposed
adjustment described in subparagraph (c) above with respect to
any Pre-Closing Period for at least 20 days after giving such
notice in subsection (c). If, within such 20-day period, Fiserv
and Buyer receive a written request from JWGFC and the Seller
that the proposed adjustments be contested, which includes a
statement of a reasonable basis in fact and in law for such
contest, Fiserv and Buyer shall contest such proposed adjustments
in good faith, provided they receive from JWGFC and Seller
security for the payment of amounts indemnified under this
Agreement with respect to such contest which is reasonable in
kind and amount based on the facts and circumstances at such time
and they agree to keep JWGFC and the Seller informed as to its
progress, all at JWGFC's and the Seller's expense, jointly and
severally; provided that, JWGFC and Seller shall have the right
to join in such contest by providing, at their own expense,
counsel to represent them in such contest. JWGFC and Seller
fully and timely shall cooperate with Fiserv and Buyer in
connection with any such proceeding. Fiserv and Buyer shall not
be required to appeal any adverse decision of a court of
competent jurisdiction; provided that Fiserv and Buyer shall
notify JWGFC and Seller of their intention not to appeal within
15 days of the deadline for the filing of any such appeal, and
JWGFC or Seller shall have the option to pursue such appeal, at
their own expense; and provided further that JWGFC and Seller
shall timely pay any amount that is necessary to perfect the
appeal (including without limitation any Tax required to be paid
by the Company or bond required to be posted), shall provide
Fiserv and Buyer with security for the payment of amounts
indemnified under this Agreement which is reasonable in kind and
amount based on the facts and circumstances at such time, and
agree to keep Fiserv and Buyer informed as to the progress and
results of the proceeding. If JWGFC or Seller paid any amount to
Fiserv or Buyer pursuant to this indemnity and subsequently
Fiserv or Buyer receives a refund with respect to such payment as
a result of appealing the issue underlying such payment, Fiserv
or Buyer, as the case may be, shall pay to JWGFC or Seller, as
the case may be, the amount of such refund relating to such issue
within 30 days after it is received.
(e) To the extent permitted by applicable law, the parties
shall elect to treat the period that includes but does not end on
the Closing Date with respect to any Tax as ending on such date
and shall take such steps as may be necessary therefor. For
purposes of this indemnification, any Taxes for a period which
includes but does not end on the Closing Date shall be allocated
between the Pre-Closing Period and the balance of the period
based on an interim closing of the books as of the close of the
Closing Date, provided, however, that any real property or
personal property Taxes and any fixed annual deductions or
44<PAGE>
<PAGE>
exemptions shall be allocated based on the relative number of
days in the Pre-Closing Period and the balance of the period.
(f) Except to the extent taken into account in determining
Final Stockholders' Equity (as finally determined), Buyer shall
pay to Seller an amount equal to any Tax refund received by the
Company with respect to any Pre-Closing Period, net of any Tax on
Fiserv, Buyer, the Company or any of their affiliates as a result
of receiving the refund.
SECTION 5.03 General Indemnity.
-----------------
(a) Subject to the terms and conditions of this Article V,
JWGFC and Seller each hereby agrees, jointly and severally, fully
to indemnify and hold Fiserv and Buyer, the Company and their
subsidiaries and affiliates harmless on an after-Tax basis from
and against any and all damages to and liabilities of same,
including without limitation those resulting from or relating to
demands, claims, actions or causes of action, assessments or
other losses, costs and expenses relating thereto, interest and
penalties thereon and reasonable attorneys' fees and expenses in
respect thereof, by reason of or resulting from (i) a breach of
any representation or warranty of the Company, JWGFC or the
Seller, as the case may be, contained in or made pursuant to this
Agreement, (ii) the failure of JWGFC or the Seller at any time,
or the failure of the Company on or prior to the Closing Date, as
the case may be, duly to perform or observe any term, provision
or covenant or agreement to be performed or observed by them or
it pursuant to this Agreement or (iii) except as otherwise agreed
in writing between JWGFC and the Seller, and Fiserv and Buyer,
any and all actions, arbitrations, suits or proceedings listed in
the Disclosure Schedule and any and all actions, arbitrations,
suits or proceedings not so listed but related to events
occurring, or actions taken or failed to be taken, on or prior to
the Closing Date.
(b) Subject to the terms and conditions of this Article V,
Fiserv and Buyer hereby fully agree to indemnify, defend and hold
JWGFC and the Seller harmless from and against all damages to and
liabilities of JWGFC and the Seller, including without limitation
those resulting from or relating to demands, claims, actions or
causes of action, assessments or other losses, costs and expenses
relating thereto, interest and penalties thereon and reasonable
attorneys' fees and expenses in respect thereof, by reason of or
resulting from (i) a breach of any representation or warranty of
Fiserv and Buyer contained in or made pursuant to this Agreement,
(ii) any failure of Fiserv and Buyer at any time duly to perform
or observe any term, provision, covenant or agreement to be
performed or observed by Fiserv and Buyer pursuant to this
Agreement or (iii) the conduct of the business of the Company by
Buyer subsequent to the Closing Date.
(c) The parties hereby acknowledge and agree that their
sole and exclusive remedy with respect to any and all claims
relating to the subject matter of this Agreement (other than a
claim for fraud or for specific performance of the terms of this
45<PAGE>
<PAGE>
Agreement, or except as otherwise provided in this Agreement)
shall be pursuant to the indemnification provisions set forth in
this Article V.
(d) The parties shall take all reasonable steps to mitigate
all liabilities and damages upon and after becoming aware of any
event which could reasonably be expected to give rise to such
liabilities and damages. In no event shall any party be liable
for consequential damages.
SECTION 5.04 Third Party Claims. If any claim, assertion
------------------
or proceeding by or in respect of a third party is made against an
indemnified party or any event in respect of a third party occurs, and
if the indemnified party intends to seek indemnity with respect
thereto under this Article V or to apply any damage or liability aris-
ing therefrom to the $250,000 amount referred to in Section 5.05, the
indemnified party shall promptly notify the indemnifying party of such
claim in writing. The indemnifying party shall have 30 days after
receipt of such notice to undertake, conduct and control, through
counsel of its own choosing and at its expense, the settlement or
defense thereof, and the indemnified party shall cooperate with it in
connection therewith; provided, that, (a) the indemnifying party shall
permit the indemnified party to participate in such settlement or
defense through counsel chosen by the indemnified party; provided that
the fees and expenses of such counsel shall be borne by the
indemnified party, (b) the indemnifying party shall promptly reimburse
the indemnified party for the full amount of any liability resulting
from such claim and all related and reasonable expenses (other than
the fees and expenses of counsel as aforesaid) incurred by the
indemnified party within the limits of this Article V and subject to
the $250,000 amount referred to in Section 5.05, (c) the indemnified
party shall not, without the prior written consent of the indemnifying
party, settle or compromise any claim or consent to the entry of any
judgment which does not include as an unconditional term thereof the
giving by the claimant or the plaintiff to the indemnified party a
full and final release from all liability in respect of such claim and
(d) nothing herein shall require any indemnified party to consent to
the entry of any order, injunction or consent decree affecting its
ability to conduct its business operations after the date thereof. So
long as the indemnifying party is reasonably contesting any such claim
in good faith, the indemnified party shall not pay or settle any such
claim. Notwithstanding the foregoing, the indemnified party shall
have the right to pay or settle any such claim without the consent of
the indemnifying party, provided that in such event it shall waive any
right to indemnity therefor by the indemnifying party. If the
indemnifying party does not notify the indemnified party within 30
days after the receipt of the indemnified party's written notice of a
claim of indemnity hereunder that it elects to undertake the defense
thereof, the indemnified party shall have the right to contest, settle
or compromise the claim in the exercise of its reasonable judgment at
the expense of the indemnifying party.
SECTION 5.05 Limitation on Indemnities. No claim for
-------------------------
indemnification will be made by Fiserv and Buyer or the Company, or by
JWGFC and Seller, under Section 5.03(a)(i) or (b)(i) hereof with
respect to any individual item of liability or damage unless and to
the extent that the aggregate of all such claims by Fiserv and Buyer
or the Company, or by JWGFC and Seller, as the case may be, shall be
46<PAGE>
<PAGE>
in excess of $250,000, and neither Fiserv and Buyer or the Company,
nor JWGFC and Seller, as the case may be, shall be required to pay or
be liable for the first $250,000 in aggregate amount of such damages
and liabilities. Payments by an indemnifying party pursuant to
Section 5.03 shall be limited to the amount of any liability or damage
that remains after deducting therefrom any insurance proceeds and any
indemnity, contribution or other similar payment reasonably
recoverable by the indemnified party from any third party with respect
thereto. Notwithstanding anything to the contrary contained in this
Agreement, no claim by any party hereto may be asserted, nor may any
action be commenced against any party hereto, for breach of any
representation, warranty, covenant or agreement unless notice thereof
is received in writing describing in reasonable detail the facts or
circumstances with respect to the subject matter of such claim on or
before the date on which the representation, warranty, covenant or
agreement on which such claim or action is based ceases to survive as
set forth in this Agreement, irrespective of whether the subject
matter of such claim or action shall have occurred before, on or after
such date.
SECTION 5.06 Effect on Purchase Price. Any payment made
------------------------
under Article V shall constitute an adjustment to the Purchase Price
for all purposes, including federal, state and local Tax as well as
financial accounting purposes. Any adjustment to the Purchase Price
shall be taken into account in recomputing the Modified Aggregate
Deemed Sales Price and Adjusted Grossed-Up Basis (and any comparable
amounts required under applicable law). The parties shall cooperate
with each other in determining such calculation and any changes to the
allocations thereof among the assets. If the parties cannot agree on
such amounts or allocation within 30 days, the matter shall be
determined by the Independent Accountant in accordance with Section
1.06 (b) hereof. Such determination shall be conclusive and binding
on the parties. The parties shall file any required forms in
connection with any Purchase Price adjustment and shall promptly
furnish a copy thereof to the other parties. In the event the
allocation of any adjustment is disputed by any Taxing authority, the
party receiving the notice of such dispute shall promptly notify and
consult with the other parties concerning the resolution of such
dispute, and shall keep the other parties apprised of the status of
such dispute and the resolution thereof. The provisions of Sections
5.04 and 5.05 shall not apply to claims for indemnification under
Section 5.02 hereof.
ARTICLE VI
FURTHER ASSURANCES
SECTION 6.01 Further Assurances. At any time and from time
------------------
to time on and after the Closing Date (i) at the request of Fiserv and
Buyer, JWGFC and/or Seller shall deliver to Fiserv and Buyer all records,
documents and data possessed by JWGFC and/or Seller and not previously
delivered to Fiserv and Buyer to which Fiserv and Buyer are entitled
hereunder, and execute and deliver or cause to be executed and
47<PAGE>
<PAGE>
delivered all such deeds, assignments, consents, documents and further
instruments of transfer and conveyance, and take or cause to be taken
all such other actions, as Fiserv and Buyer may reasonably deem
necessary or desirable in order to fully and effectively vest in
Fiserv and Buyer, or to confirm its title to and possession of, all of
the Shares or to assist Fiserv and Buyer in exercising full rights
with respect thereto which Fiserv and Buyer are entitled to exercise
pursuant to the terms of this Agreement; and (ii) Fiserv and Buyer
shall execute and deliver or cause to be executed and delivered such
further instruments and take or cause to be taken such further actions
as JWGFC and/or Seller may reasonably deem necessary or desirable to
carry out the terms and provisions of this Agreement.
SECTION 6.02 Books and Records.
-----------------
(a) Fiserv and Buyer each agrees that it shall preserve and
keep all books and records relating to the Company in Fiserv's and
Buyer's possession until six months following the expiration of the
statute of limitations (including extensions thereof) applicable to
the Tax Returns filed by or with respect to the Company for taxable
periods ending prior to or on the Closing Date to which such books
or records are relevant. After such time, before Fiserv and Buyer
shall dispose of any of such books and records, at least 90 calendar
days' prior written notice to such effect shall be given by Fiserv and
Buyer to JWGFC and Seller, and JWGFC and Seller each shall be given an
opportunity, at its sole cost and expense, to remove all or any part
of such books and records as JWGFC and/or Seller may select, and JWGFC
and/or Seller may retain copies thereof. Duly authorized representa-
tives of JWGFC and Seller shall, upon reasonable notice, have access
to such books and records during normal business hours to examine, in-
spect and copy such books and records.
(b) In any instance in which either JWGFC and Seller, the
Company or Fiserv and Buyer, as the case may be, is required to prepare
or file (or cause to be filed) Tax Returns which cover a period that
includes the Closing Date or to respond to any Proceeding with respect
to the Pre-Closing Period, JWGFC and Seller, the Company or Fiserv and
Buyer, as the case may be, will furnish all information and records
reasonably available to it and reasonably requested of it and necessary
or appropriate for use in preparing such returns or responding to such
Proceeding.
(c) Buyer and Fiserv will furnish or cause the Company to
furnish all information and records reasonably available to them or it
and reasonably requested of them that JWGFC determines are needed for
the preparation of any filing or filing related obligation of JWGFC
under the Securities Act of 1933, as amended, or under the Exchange Act
of 1934, as amended.
ARTICLE VII
48<PAGE>
<PAGE>
MISCELLANEOUS
SECTION 7.01 Termination. This Agreement may be terminated
-----------
at any time prior to the Closing:
(a) by the mutual written consent of JWGFC and Seller, and
Fiserv and Buyer;
(b) by Seller's written notice to the other parties, if the
Closing shall not have occurred by the 60th calendar day after
the date hereof through no fault of JWGFC or Seller; or
(c) by written notice to the other parties by either Seller
or Fiserv and Buyer, if the Closing shall not have occurred prior
to the first anniversary of this Agreement; provided, however,
that the right to terminate this Agreement under this Section
7.01 (c) shall not be available to any party whose failure (or
whose parent's failure) to fulfill any obligation under this
Agreement shall have been the cause of, contributed materially to
or shall have resulted in, the failure of the Closing to occur
prior to such date.
SECTION 7.02 Effect of Termination. In the event of
---------------------
termination of this Agreement as provided in Section 7.01, this
Agreement shall forthwith become void and there shall be no liability
on the part of any party hereto, except that (i) Sections 3.06, 7.03,
7.08, 7.09, 7.10, 7.13, and 7.14 hereof shall survive such termination
and (ii) nothing herein shall relieve any party from liability for any
willful breach of any other provision hereof.
SECTION 7.03 Expenses, Etc. Whether or not the transactions
-------------
contemplated by this Agreement are consummated, none of the parties
hereto shall have any obligation to pay any of the fees and expenses
of the other parties incident to the negotiation, preparation and
execution of this Agreement, including the fees and expenses of
counsel, accountants and other experts. Each of JWGFC and Seller, the
Company and Fiserv and Buyer shall indemnify the other parties, and
fully hold them harmless from and against any and all claims for
finders' fees or brokerage commissions in relation to or in connection
with such transactions as a result of any agreement or understanding
between such indemnifying party and any third person or party. JWGFC
and Seller shall pay and be responsible for any and all transfer and
similar Taxes (but not other Taxes such as federal, state or local
income Taxes, all of which shall be handled as provided in Section
3.06 and Section 5.02) arising from the transactions contemplated by
this Agreement, and shall provide Fiserv and Buyer with a copy of any
Tax Return required in connection therewith with sufficient time for
its/their review prior to filing.
SECTION 7.04 Execution in Counterparts. For the conve-
-------------------------
nience of the parties, this Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of
which together when signed by all of the parties shall constitute one
and the same instrument.
49<PAGE>
<PAGE>
SECTION 7.05 Notices. All notices, consents, requests, and
-------
demands to or upon the respective parties hereto to be effective shall
be in writing and, unless otherwise expressly provided herein, shall
be deemed to have been duly given or made (a) on the date delivered in
person, (b) on the date indicated on the return receipt if mailed
postage prepaid, by certified or registered U.S. Mail, with return
receipt requested, (c) on the date transmitted by facsimile, if sent
on a business day by 5:00 P.M., Eastern Time, and confirmation of
receipt thereof is reflected or obtained, or (d) if sent by Federal
Express or other nationally recognized over night courier service or
overnight express U.S. Mail in time for and specifying next day or
next business day delivery, with service charges or postage prepaid,
then on the next business day after delivery to the courier service or
U.S. Mail. In each case (except for personal delivery) such notices,
requests, demands, and other communications shall be sent to a party
at its address or facsimile number as follows, or as otherwise
designated by the party by notice in accordance herewith:
If to JWGFC, to:
JWGenesis Financial Corp.
980 N. Federal Highway, Suite 310
Boca Raton, Florida 33432
Telecopier: 561-338-2809
Attention: Joel E. Marks
With a copy to:
Kilpatrick Stockton LLP
1100 Peachtree Street
Atlanta, Georgia 30309-4530
Telecopier: (404) 815-6555
Attention: W. Randy Eaddy, Esq.
If to the Seller, to:
JWGenesis Financial Services, Inc.
980 N. Federal Highway, Suite 310
Boca Raton, Florida 33432
Telecopier: 561-338-2809
50<PAGE>
<PAGE>
Attention: Joel E. Marks
With a copy to:
Kilpatrick Stockton LLP
1100 Peachtree Street
Atlanta, Georgia 30309-4530
Telecopier: (404) 815-6555
Attention: W. Randy Eaddy, Esq.
If to the Company, to:
JWGenesis Clearing Corp.
980 N. Federal Highway, Suite 310
Boca Raton, Florida 33432
Telecopier: 561-338-2809
Attention: Joel E. Marks
With a copy to:
Kilpatrick Stockton LLP
1100 Peachtree Street
Atlanta, Georgia 30309-4530
Telecopier: (404) 815-6555
Attention: W. Randy Eaddy, Esq.
If to Fiserv to:
Fiserv, Inc.
255 Fiserv Drive
Brookfield, WI 53045
or
P.O. Box 979
Brookfield, WI 53008-0979
FAX (414) 879-5245
Attention: Kenneth R. Jensen
51<PAGE>
<PAGE>
with a copy to:
Charles W. Sprague
Fiserv, Inc.
255 Fiserv Drive
Brookfield, WI 53045
or
P.O. Box 979
Brookfield, WI 53008-0979
FAX (414) 879-5532
If to the Buyer, to:
Fiserv Clearing, Inc.
1125 17th St., Suite 1810
Denver, Co. 80202
FAX (303)-291-5526
Attention: Robert H. Beriault
With a copy to:
Charles W. Sprague
Fiserv, Inc.
255 Fiserv Drive
Brookfield, WI 53045
or
P.O. Box 979
Brookfield, WI 53008-0979
FAX (414) 879-5532
SECTION 7.06 Waivers. Any party hereto (as to itself,
-------
but not as to other parties without their written consent) may,
by written notice to the other parties hereto, (i) extend the
time for the performance of any of the obligations or other
actions of the other parties under this Agreement; (ii) waive any
inaccuracies in the representations or warranties of another
party contained in this Agreement or in any document delivered
pursuant to this Agreement; (iii) waive compliance with any of
the conditions or covenants of another party contained in this
Agreement; or (iv) waive performance of any of the obligations of
52<PAGE>
<PAGE>
another party under this Agreement. Except as otherwise provided
in the preceding sentence or Section 3.02 hereof, no action taken
pursuant to this Agreement, including without limitation any
investigation by or on behalf of any party, shall be deemed to
constitute a waiver by the party taking such action of compliance
with any representation, warranty, covenant or agreement
contained in this Agreement. The waiver by any party hereto of a
breach of any provision of this Agreement shall be valid only if
said waiver is stated in a writing signed by an authorized
officer of the waiving party, and shall not operate or be
construed a waiver of any subsequent breach.
SECTION 7.07 Amendments, Supplements, etc. At any
----------------------------
time this Agreement may be amended or supplemented in writing by
such additional agreements, articles or certificates, as may be
determined by the parties hereto to be necessary, desirable or
expedient to further the purposes of the Agreement, or to clarify
the intention of the parties hereto, or to add to or modify the
covenants, terms or conditions hereof or to effect or facilitate
any governmental approval or acceptance of this Agreement or to
effect or facilitate the filing or recording of this Agreement or
the consummation of any of the transactions contemplated hereby.
To be valid and binding, any such instrument must be in writing
and signed by all parties.
SECTION 7.08 Entire Agreement. This Agreement, its
----------------
Exhibits and Schedules and the documents executed on the Closing
Date in connection herewith, constitute the entire agreement
between the parties hereto with respect to the subject matter
hereof and supersede all prior agreements and understandings,
oral and written, between and among the parties hereto with
respect to the subject matter hereof. No representation,
warranty, promise, inducement or statement of intention has been
made by any party hereto which is not embodied in this Agreement
or such other documents, and no party hereto shall be bound by,
or be liable for, any alleged representation, warranty, promise,
inducement or statement of intention not embodied herein or
therein.
SECTION 7.09 Applicable Law and Dispute Resolution.
-------------------------------------
(a) This Agreement shall be governed by and construed
in accordance with the laws of the State of Wisconsin,
without regard to conflict of law provisions that would
defer to the substantive laws of another jurisdiction.
(b) If any sum(s) required to be paid hereunder by any
party to any other party is/are not paid fully when due,
interest on all unpaid portions of said sum(s) shall accrue
at the prime interest rate, then in effect, of the Bank of
New York (or any successor thereto), from the date due until
the unpaid portion is paid fully by the party having the
obligation to make such payment(s), including all accrued
interest.
(c) In the event of any arbitration or other legal
proceeding(s) arising out of or related to this Agreement,
the nonprevailing party or parties in such proceeding(s)
53<PAGE>
<PAGE>
shall pay to the prevailing party or parties all of the
costs and expenses incurred by the prevailing party or
parties in respect of such proceeding(s), including but not
limited to all arbitration costs, court costs, attorneys
fees and expert fees. However, unless otherwise
specifically agreed in writing, the foregoing shall in no
event apply to settlements.
(d) The interest and costs described respectively in
Sections 7.09 (b) and (c) above shall be in addition to any
and all other relief to which any party is entitled under
this Agreement and by law or equity.
SECTION 7.10 Arbitration.
-----------
(a) Except as expressly provided otherwise, the
parties agree to use their commercially reasonable efforts
and act in good faith to settle or otherwise resolve, first,
by mediation, and if such mediation does not result in a
settlement or resolution, then by arbitration, any dispute
or controversy between them or their affiliates, officers,
directors, employees, or agents, which dispute or
controversy relates to this Agreement, or in any way arises
out of this Agreement. Any such arbitration will be
conducted in the forum, and according to the securities
arbitration rules then in effect, of the NASD. Arbitration
or mediation may be initiated by serving or mailing a
written notice. Any award that an arbitrator makes will be
final and binding, and judgment on it may be entered in any
court having jurisdiction. The arbitration provision of
this Section shall be enforced and interpreted exclusively
in accordance with applicable federal Law, including the
Federal Arbitration Act.
(b) ARBITRATION DISCLOSURE. ARBITRATION IS FINAL AND
BINDING ON THE PARTIES. THE PARTIES ARE WAIVING THEIR RIGHT
TO SEEK REMEDIES IN COURT, INCLUDING THE RIGHT TO A JURY
TRIAL. PRE-ARBITRATION DISCOVERY IS GENERALLY MORE LIMITED
THAN AND DIFFERENT FROM COURT PROCEEDINGS. AN ARBITRATOR'S
AWARD IS NOT REQUIRED TO INCLUDE FACTUAL FINDINGS OR LEGAL
REASONING AND ANY PARTY'S RIGHT TO APPEAL OR TO SEEK
MODIFICATION OF RULINGS BY AN ARBITRATORS IS STRICTLY
LIMITED. THE PANEL OF ARBITRATORS WILL TYPICALLY INCLUDE A
MINORITY OF ARBITRATORS WHO WERE OR ARE AFFILIATED WITH THE
SECURITIES INDUSTRY.
SECTION 7.11 Binding Effect, Benefits. This Agreement
------------------------
shall inure to the benefit of and be binding upon the parties
hereto and their respective successors and assigns. Notwith-
standing anything contained in this Agreement to the contrary,
nothing in this Agreement, expressed or implied, is intended to
confer on any person or entity other than the parties hereto or
their respective successors and assigns, any rights, remedies,
obligations or liabilities under or by reason of this Agreement.
54<PAGE>
<PAGE>
SECTION 7.12 Assignability. Neither this Agreement
-------------
nor any of the parties' rights or obligations hereunder shall be
assignable or delegable in whole or in part by any party hereto
without the prior written consent of the other parties hereto.
Notwithstanding the previous sentence: (a) Buyer may assign any
or all of its rights and delegate any or all of its obligations
hereunder to a wholly-owned subsidiary of Buyer; and (b) Fiserv
may assign any or all of its rights and delegate any or all of
its obligations hereunder to a wholly-owned subsidiary of Fiserv,
except for its direct obligation in this Agreement to cause the
payment of any amount due to Seller or JWGFC hereunder.
SECTION 7.13 Disclosure Schedule. Disclosure of
-------------------
information in any portion of the Disclosure Schedule hereto
shall be deemed disclosure in any other portion of the Disclosure
Schedule. Up to and including Closing, JWGFC, Seller and Company
shall have a continuing obligation to revise, supplement and/or
update the Disclosure Schedule to keep it current, complete and
accurate.
SECTION 7.14 Public Announcements. Fiserv and Buyer,
--------------------
JWGFC and Seller and the Company will consult with each other
before issuing any press release or otherwise making any public
statement with respect to the transactions contemplated herein
and shall not issue any such press release or make any such
public statement without the prior approval of the other, which
shall not be unreasonably withheld, unless counsel has advised
such party that such release or other public statement must be
issued immediately and the issuing party has not been able,
despite its good faith efforts, to secure the prior approval of
the other party.
SECTION 7.15 Invalid Provisions. If any provision of
------------------
this Agreement is held to be illegal, invalid or unenforceable
under any present or future law, rule or regulation, such provi-
sion shall be fully severable and this Agreement shall be con-
strued and enforced as if such illegal, invalid or unenforceable
provision had never comprised a part hereof. The remaining
provisions of this Agreement shall remain in full force and
effect and shall not be affected by the illegal, invalid or
unenforceable provision or by its severance therefrom. Further-
more, in lieu of such illegal, invalid or unenforceable provi-
sion, there shall be added automatically as a part of this Agree-
ment a legal, valid and enforceable provision as similar in terms
to such illegal, invalid or unenforceable provision as may be
possible.
55
<PAGE>
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the date first above written.
FISERV, INC.
By /s/ Robert H. Beriault
--------------------------------------------
Robert H. Beriault, Executive Vice President
FISERV CLEARING, INC.
By /s/ Lawrence E. Donato
--------------------------------------------
Lawrence E. Donato, Senior Vice President
JWGENESIS FINANCIAL CORP.
By /s/ Joel E. Marks
--------------------------------------------
Joel E. Marks, Vice Chairman and Chief
Operating Officer
JWGENESIS FINANCIAL SERVICES, INC.
By /s/ Joel E. Marks
--------------------------------------------
Joel E. Marks, Executive Vice President
JWGENESIS CLEARING CORP.
By /s/ Joel E. Marks
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Joel E. Marks, Executive Vice President
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