<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1995
--------------------------------------
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
------------- -------------
Commission file number 0-4781
----------------------------------------------
MARKET FACTS, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 36-2061602
- ------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
3040 West Salt Creek Lane, Arlington Heights, Illinois 60005
- ------------------------------------------------------ ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (708) 590-7000
-------------------------
INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS REQUIRED
TO BE FILED BY SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DURING
THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE REGISTRANT WAS
REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO SUCH FILING
REQUIREMENTS FOR THE PAST 90 DAYS. YES [X] NO [_]
INDICATE THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE REGISTRANT'S CLASSES OF
COMMON STOCK, AS OF THE LATEST PRACTICABLE DATE.
1,906,835 common shares as of April 19, 1995
- --------------------------------------------------------------------------------
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
Market Facts, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
As of March 31, 1995 and December 31, 1994
Assets
------
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
----------- ------------
<S> <C> <C>
Current Assets:
Cash $ 366,066 $ 911,209
Time deposit 50,000 50,000
Accounts receivable:
Trade, less allowance for doubtful accounts of
$718,195 in 1995 and $668,805 in 1994 9,256,477 9,433,470
Other 86,149 128,232
Notes receivable 90,786 59,037
Revenue earned on contracts in progress
in excess of billings 2,705,317 2,394,591
Deferred income taxes 624,578 624,578
Prepaid expenses and other assets 264,378 435,723
- ----------------------------------------------------------------------------------------------
Total Current Assets $13,443,751 $14,036,840
- ----------------------------------------------------------------------------------------------
Other Assets:
Goodwill, net of accumulated amortization 588,932 599,386
Mail panel acquired, net of accumulated amortization 162,539 182,857
- ----------------------------------------------------------------------------------------------
Total Other Assets $ 751,471 $ 782,243
- ----------------------------------------------------------------------------------------------
Property, at cost 25,038,610 24,539,362
Less accumulated depreciation and amortization (8,212,905) (7,676,462)
- ----------------------------------------------------------------------------------------------
Net Property $16,825,705 $16,862,900
- ----------------------------------------------------------------------------------------------
Total Assets $31,020,927 $31,681,983
==============================================================================================
</TABLE>
Page 1
<PAGE>
Market Facts, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
As of March 31, 1995 and December 31, 1994
Liabilities and Stockholders' Equity
------------------------------------
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
------------- --------------
<S> <C> <C>
Current Liabilities:
Short-term borrowings $ 400,000 $ ---
Accrued expenses 3,463,609 4,393,196
Billings in excess of revenues earned
on contracts in progress 3,118,696 3,712,487
Accounts payable 996,310 995,644
Income taxes 365,899 684,950
Current portion of note payable for acquisition of MFCL 339,127 339,127
Current portion of obligations under capital leases 193,444 185,026
Current portion of long-term debt 102,190 102,190
- --------------------------------------------------------------------------------------------------------------
Total Current Liabilities $ 8,979,275 $10,412,620
- --------------------------------------------------------------------------------------------------------------
Long-Term Liabilities:
Long-term debt 10,507,554 10,532,183
Obligations under capital leases, noncurrent portion 622,150 581,710
Note payable for acquisition of MFCL, noncurrent portion 339,126 339,126
Deferred income taxes 39,122 39,122
Other long-term liabilities 20,463 31,037
- --------------------------------------------------------------------------------------------------------------
Total Long-Term Liabilities $11,528,415 $11,523,178
- --------------------------------------------------------------------------------------------------------------
Total Liabilities $20,507,690 $21,935,798
- --------------------------------------------------------------------------------------------------------------
Stockholders' Equity:
Preferred stock, no par value;
500,000 shares authorized; none issued $ --- $ ---
Common stock, $1 par value; 5,000,000 shares authorized;
2,091,237 and 1,973,241 shares issued in 1995 and 1994, respectively 2,091,237 1,973,241
Capital in excess of par value 2,253,135 1,765,776
Cumulative foreign currency translation (97,606) (100,391)
Retained earnings 8,294,033 8,021,066
- --------------------------------------------------------------------------------------------------------------
$12,540,799 $11,659,692
- --------------------------------------------------------------------------------------------------------------
Less 184,402 shares in 1995 and 1994 of treasury common
stock, at cost (1,310,134) (1,310,134)
Less other transactions involving common stock (717,428) (603,373)
- --------------------------------------------------------------------------------------------------------------
Total Stockholders' Equity $10,513,237 $ 9,746,185
- --------------------------------------------------------------------------------------------------------------
Total Liabilities and Stockholders' Equity $31,020,927 $31,681,983
==============================================================================================================
</TABLE>
Page 2
<PAGE>
Market Facts, Inc. and Subsidiaries
Condensed Consolidated Statements of Earnings
For The Three Months Ended March 31, 1995 and 1994
<TABLE>
<CAPTION>
Three Months Ended March 31,
-------------------------------
1995 1994
------------- -------------
<S> <C> <C>
Revenue $15,333,400 $11,117,531
- ------------------------------------------------------------------------------------------------------------
Direct Costs:
Payroll $ 3,402,759 $ 2,562,365
Other expenses 5,347,866 3,603,678
- ------------------------------------------------------------------------------------------------------------
Total $ 8,750,625 $ 6,166,043
- ------------------------------------------------------------------------------------------------------------
Gross Margin $ 6,582,775 $ 4,951,488
- ------------------------------------------------------------------------------------------------------------
Operating Expenses:
Selling $ 588,749 $ 494,246
General and administrative 4,821,450 3,959,853
Contributions to profit-sharing and employee stock ownership plans 114,038 45,540
- ------------------------------------------------------------------------------------------------------------
Total $ 5,524,237 $ 4,499,639
- ------------------------------------------------------------------------------------------------------------
Income from operations $ 1,058,538 $ 451,849
- ------------------------------------------------------------------------------------------------------------
Other Income (Expense):
Interest expense $ (285,757) $ (280,067)
Interest income 12,442 9,657
Equity in income of MFCL --- 30,000
Other income, net 22,911 43,643
- ------------------------------------------------------------------------------------------------------------
Total $ (250,404) $ (196,767)
- ------------------------------------------------------------------------------------------------------------
Income Before Provision For Income Taxes $ 808,134 $ 255,082
Provision For Income Taxes 390,820 102,034
- ------------------------------------------------------------------------------------------------------------
Net Income $ 417,314 $ 153,048
============================================================================================================
Earnings per share $ .23 $ .08
============================================================================================================
Common and common equivalent shares 1,847,671 1,909,365
============================================================================================================
Cash dividends declared $ .08 $ .07
============================================================================================================
</TABLE>
Page 3
<PAGE>
Market Facts, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
For The Three Months Ended March 31, 1995 and 1994
<TABLE>
<CAPTION>
Three Months Ended March 31,
-------------------------------
1995 1994
------------- --------------
<S> <C> <C>
Cash Flows From Operating Activities:
Net income $ 417,314 $ 153,048
Adjustments to reconcile net income to net cash used in
operating activities:
Depreciation and amortization 576,271 494,508
Undistributed earnings of MFCL --- (30,000)
Vesting of restricted stock and demand notes receivable 13,858 11,875
Net gain on disposal of property (8,262) (34,776)
Change in assets and liabilities:
Accounts receivable 221,035 1,143,004
Prepaid expenses and other assets 171,458 (97,824)
Billings in excess of (less than) revenues earned on
contracts in progress (904,212) (823,264)
Accounts payable and accrued expenses (930,272) (1,314,249)
Income taxes (319,094) 24,521
- ----------------------------------------------------------------------------------------------------
Net cash used in operating activities $(761,904) $ (473,157)
- ----------------------------------------------------------------------------------------------------
Cash Flows From Investing Activities:
Purchases of property $(419,627) $ (381,767)
Investment in notes receivable (200,250) (24,276)
Proceeds from notes receivable 40,588 76,129
Proceeds from the sale of property 15,517 78,099
Purchase of time deposit (250,000) ---
Proceeds from time deposit 250,000 ---
- ----------------------------------------------------------------------------------------------------
Net cash used in investing activities $(563,772) $ (251,815)
- ----------------------------------------------------------------------------------------------------
Cash Flows From Financing Activities:
Proceeds from short-term borrowings $ 600,000 $ 1,000,000
Repayment of short-term borrowings (200,000) (700,000)
Dividends paid (144,347) (124,693)
Reduction in obligations under capital leases and long-term debt (81,838) (68,246)
Proceeds from exercise of stock options 605,355 ---
- ----------------------------------------------------------------------------------------------------
Net cash provided by financing activities $ 779,170 $ 107,061
- ----------------------------------------------------------------------------------------------------
Effect of exchange rate changes on cash $ 1,363 $ ---
- ----------------------------------------------------------------------------------------------------
Net decrease in cash and cash equivalents $(545,143) $ (617,911)
Cash and cash equivalents at beginning of period 911,209 772,986
- ----------------------------------------------------------------------------------------------------
Cash and cash equivalents at end of period $ 366,066 $ 155,075
====================================================================================================
Cash Paid During The Period For:
Interest $ 282,093 $ 277,544
Income taxes $ 709,915 $ 77,513
====================================================================================================
Supplemental Schedule of Noncash Financing Activity -
Capital lease obligations incurred on lease of equipment $ 105,297 $ ---
====================================================================================================
</TABLE>
Page 4
<PAGE>
NOTES TO FINANCIAL STATEMENTS
Note 1 - Basis of Presentation
- ------------------------------
The accompanying unaudited condensed consolidated financial statements of Market
Facts, Inc. and Subsidiaries (the Company) have been prepared in accordance with
instructions to Form 10-Q. The results of operations for interim periods are
not necessarily indicative of the results to be expected for the entire year.
For further information regarding the Company's most recent completed fiscal
years, refer to the consolidated financial statements included in the Company's
Annual Report on Form 10-K for the year ended December 31, 1994.
Note 2 - Adjustments
- --------------------
The information furnished herein includes all adjustments, consisting of normal
recurring adjustments, which are, in the opinion of management, necessary for a
fair presentation of the interim financial statements.
Note 3 - Foreign Currency Translation
- -------------------------------------
Assets and liabilities of Market Facts of Canada, Ltd. (MFCL), the Company's
only foreign subsidiary, have been translated using the exchange rate in effect
at the balance sheet date. MFCL's results of operations are translated using
the average exchange rate prevailing throughout the period. Resulting
translation gains and losses are reported as a component of stockholders'
equity.
Note 4 - Revenue Recognition
- ----------------------------
The Company recognizes revenue under the percentage of completion method of
accounting. Revenue on client projects are recognized as services are
performed. Losses expected to be incurred on jobs in progress are charged to
income as soon as such losses are known. Revenue earned on contracts in
progress in excess of billings are classified as a current asset. Amounts
billed in excess of revenue earned are classified as a current liability.
Client projects are expected to be completed within a twelve month period.
Page 5
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
Liquidity and Capital Resources
- -------------------------------
The ratio of current assets to current liabilities was 1.5 to 1 as of March 31,
1995 versus 1.3 to 1 as of December 31, 1994. The improvement in the ratio is
primarily attributable to the reduction in accrued expenses of $929,587, as 1994
bonuses and the Company's profit-sharing contribution were paid during the first
quarter of 1995, and a reduction in net billings in excess of revenues earned on
contracts in progress of $904,212, due to less timely billings on contracts in
progress. These items were partially offset by a reduction in cash.
Cash decreased by $545,143 from December 31, 1994 to March 31, 1995. This was
primarily the result of lower net billings on client contracts in excess of
revenues earned on those contracts of $904,212, a reduction in accrued expenses
of $929,587 and purchases of property of $419,627. The reduction in cash was
partially offset by the proceeds from the exercise of Company stock options of
$605,355 and increased short-term bank borrowings, net of repayments, of
$400,000.
The Company maintains an established $4,000,000 bank line of credit which is
renewed annually. The Company believes that cash flow from future operations,
its ability to secure additional leases and borrowings available from its line
of credit will be adequate to fund property requirements, investing activities
and growth for the foreseeable future.
Results of Operations
- ---------------------
Comparison of First Quarter 1995 to First Quarter 1994
- ------------------------------------------------------
During the first quarter of 1995, the Company had revenue of $15,333,400, an
increase of 37.9% over the same period in 1994. The growth in revenue was due
primarily to higher levels of utilization of research products and services that
are proprietary to the Company and the acquisition of MFCL.
Gross margin for the first quarter of 1995 was $6,582,775, an increase of 32.9%
over the same period in 1994. The increase in gross margin was due to the
growth in revenue. Gross margin as a percentage of revenue was 42.9% during the
first quarter of 1995 compared to 44.5% for the same period in 1994. The
decline in the gross margin percentage is primarily attributable to two factors.
First, the Company is allocating a greater share of internal operating costs
directly to client research projects and second, the Company has experienced
growth in certain types of business which yield lower gross margin percentages
but which require only a minimal increase in operating expenses.
Operating expenses for the first quarter of 1995 rose by $1,024,598, an increase
of 22.8% compared to the same period in 1994. This increase is due primarily to
the increased level of business activity offset by the increase in internal
operating costs being allocated to client research projects. However, operating
expenses as a percentage of revenue declined from 40.5% in 1994 to 36.0% in 1995
primarily as a result of the increase in internal operating costs being
allocated to client research projects and the Company's ability to control
overhead payroll expense.
Provision for income taxes for the first quarter of 1995 reflects an effective
income tax rate of 48.4% versus 40.0% in 1994. The increase in the effective
rate is primarily due to the addition in 1995 of foreign income taxes and higher
state and local income taxes.
Net income for the first quarter of 1995 was $417,314 or 2.7% of revenue
compared with $153,048 and 1.4% of revenue during the same period in 1994.
Page 6
<PAGE>
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits.
The following represents an index to the exhibits filed in conjunction with
the Form 10-Q for the quarterly period ended March 31, 1995:
Exhibit Number Description
-------------- -----------
(2)(1) Stock Purchase Agreement by and among Market Facts, Inc. and
John C. Robertson and Roberta Robertson dated as of April 27,
1994.
(3)(a)(5) Composite Certificate of Incorporation as Amended and
Currently in Effect.
(3)(b)(3) By-laws as Amended and Currently in Effect.
(4)(a)(5) Article Fourth of Certificate of Incorporation is included in
Exhibit (3)(a) above.
(4)(b)(6) The Stockholder Rights Plan.
(10.1) Term note dated February 23, 1995 between Market Facts, Inc.
and Verne Churchill.
(10.2) Term note dated February 23, 1995 between Market Facts, Inc.
and Lawrence Labash.
(10.3) Term note dated February 23, 1995 between Market Facts, Inc.
and Thomas Payne.
(10.4) Term note dated February 23, 1995 between Market Facts, Inc.
and Glenn Schmidt.
(10.5) Term note dated March 1, 1995 between Market Facts, Inc. and
Stephen J. Weber.
(10.6)(7) Promissory note dated April 1, 1994 between Market Facts,
Inc. and Stephen J. Weber.
(10.7)(1) Employment Agreement by and among Market Facts of Canada,
Ltd., Market Facts, Inc. and John C. Robertson dated as of
April 14, 1994.
(10.8)(4) 1982 Executive Incentive Stock Option Plan.
(10.9)(3) Mortgage and Security Agreement dated April 11, 1990 between
American National Bank and Trust Company as Trustee under
Trust No. 110201-04 and The Manufacturers Life Insurance
Company together with Mortgage Note.
Page 7
<PAGE>
Exhibit Number Description
-------------- -----------
(10.10)(2) Unsecured Note and Procedures Letter between Market Facts,
Inc. and Harris Trust and Savings Bank.
(10.11)(2) Employment Agreement with Verne B. Churchill.
(10.12)(2) Employment Agreement with Lawrence W. Labash.
(10.13)(2) Employment Agreement with Timothy Q. Rounds.
(10.14)(2) Employment Agreement with Glenn W. Schmidt.
(10.15)(2) Employment Agreement with Sanford M. Schwartz.
(10.16)(2) Indemnity Agreement with Jack R. Wentworth.
Substantially identical agreements were also entered into
with the following directors:
William W. Boyd John C. Robertson
Verne B. Churchill Timothy Q. Rounds
Lawrence W. Labash Glenn W. Schmidt
Thomas H. Payne Sanford M. Schwartz
Karen E. Predow-James Wesley S. Walton
(27) Financial Data Schedule.
(b) Reports on Form 8-K.
None.
_____________________
(1) Incorporated by reference to Registrant's Quarterly Report on Form 10-Q for
the quarterly period ended March 31, 1994.
(2) Incorporated by reference to Registrant's Quarterly Report on Form 10-Q for
the quarterly period ended September 30, 1994.
(3) Incorporated by reference to Registrant's Annual Report on Form 10-K for
its fiscal year ended December 31, 1992.
(4) Incorporated by reference to Exhibit No. 10(d) of Registrant's Annual
Report on Form 10-K for its fiscal year ended December 31, 1981, commission
file number 0-4781.
(5) Incorporated by reference to Registrant's Annual Report on Form 10-K/A-1
for its fiscal year ended December 31, 1993.
(6) Incorporated by reference to Exhibit No. 4 of Registrant's Form 8-K dated
August 7, 1989, commission file number 0-4781.
(7) Incorporated by reference to Registrant's Quarterly Report on Form 10-Q/A-1
for the quarterly period ended June 30, 1994.
Page 8
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Market Facts, Inc.
---------------------------------------
(Registrant)
Date: April 28, 1995 Timothy J. Sullivan
------------------------- ---------------------------------------
Timothy J. Sullivan
Vice President, Treasurer and
Assistant Secretary
(Principal Accounting Officer)
Date: April 28, 1995 Glenn W. Schmidt
------------------------- ---------------------------------------
Glenn W. Schmidt
Executive Vice President, Assistant
Secretary and Assistant Treasurer
(Principal Financial Officer)
Page 9
<PAGE>
INDEX TO EXHIBITS
Exhibit Number Description
- -------------- -----------
(2)(1) Stock Purchase Agreement by and among Market Facts, Inc. and
John C. Robertson and Roberta Robertson dated as of April 27,
1994.
(3)(a)(5) Composite Certificate of Incorporation as Amended and Currently
in Effect.
(3)(b)(3) By-laws as Amended and Currently in Effect.
(4)(a)(5) Article Fourth of Certificate of Incorporation is included in
Exhibit (3)(a) above.
(4)(b)(6) The Stockholder Rights Plan.
(10.1) Term note dated February 23, 1995 between Market Facts, Inc. and
Verne Churchill.
(10.2) Term note dated February 23, 1995 between Market Facts, Inc. and
Lawrence Labash.
(10.3) Term note dated February 23, 1995 between Market Facts, Inc. and
Thomas Payne.
(10.4) Term note dated February 23, 1995 between Market Facts, Inc. and
Glenn Schmidt.
(10.5) Term note dated March 1, 1995 between Market Facts, Inc. and
Stephen J. Weber.
(10.6)(7) Promissory note dated April 1, 1994 between Market Facts, Inc.
and Stephen J. Weber.
(10.7)(1) Employment Agreement by and among Market Facts of Canada, Ltd.,
Market Facts, Inc. and John C. Robertson dated as of April 14,
1994.
(10.8)(4) 1982 Executive Incentive Stock Option Plan.
(10.9)(3) Mortgage and Security Agreement dated April 11, 1990 between
American National Bank and Trust Company as Trustee under Trust
No. 110201-04 and The Manufacturers Life Insurance Company
together with Mortgage Note.
(10.10)(2) Unsecured Note and Procedures Letter between Market Facts, Inc.
and Harris Trust and Savings Bank.
(10.11)(2) Employment Agreement with Verne B. Churchill.
(10.12)(2) Employment Agreement with Lawrence W. Labash.
(10.13)(2) Employment Agreement with Timothy Q. Rounds.
(10.14)(2) Employment Agreement with Glenn W. Schmidt.
Page 10
<PAGE>
Exhibit Number Description
-------------- -----------
(10.15)(2) Employment Agreement with Sanford M. Schwartz.
(10.16)(2) Indemnity Agreement with Jack R. Wentworth.
Substantially identical agreements were also entered into with
the following directors:
William W. Boyd John C. Robertson
Verne B. Churchill Timothy Q. Rounds
Lawrence W. Labash Glenn W. Schmidt
Thomas H. Payne Sanford M. Schwartz
Karen E. Predow-James Wesley S. Walton
(27) Financial Data Schedule.
_____________________
(1) Incorporated by reference to Registrant's Quarterly Report on Form 10-Q for
the quarterly period ended March 31, 1994.
(2) Incorporated by reference to Registrant's Quarterly Report on Form 10-Q for
the quarterly period ended September 30, 1994.
(3) Incorporated by reference to Registrant's Annual Report on Form 10-K for
its fiscal year ended December 31, 1992.
(4) Incorporated by reference to Exhibit No. 10(d) of Registrant's Annual
Report on Form 10-K for its fiscal year ended December 31, 1981, commission
file number 0-4781.
(5) Incorporated by reference to Registrant's Annual Report on Form 10-K/A-1
for its fiscal year ended December 31, 1993.
(6) Incorporated by reference to Exhibit No. 4 of Registrant's Form 8-K dated
August 7, 1989, commission file number 0-4781.
(7) Incorporated by reference to Registrant's Quarterly Report on Form 10-Q/A-1
for the quarterly period ended June 30, 1994.
Page 11
<PAGE>
TERM NOTE
February 23, 1995
For value received, VERNE CHURCHILL promises to pay on April 1, 1999 to the
order of Market Facts, Inc., 3040 Salt Creek Lane, Arlington Heights, Illinois,
60005, or at any such other place as the payee or legal holder hereof may in
writing appoint, the sum of TWENTY THOUSAND AND FIVE HUNDRED DOLLARS ($20,500)
together with interest.
Interest will be billed to the undersigned annually for the period of March 1
through February 28 ("Interest Rate Year") and will be calculated based upon the
balance of the Note outstanding on the first day of the Interest Rate Year. The
rate of interest will be 7.75%.
The undersigned agrees to surrender to Market Facts, Inc. 4,000 shares of Market
Facts common stock to be held as collateral for this Note until such time as the
unpaid balance of principal and interest are paid in full.
The undersigned hereby authorizes, irrevocably, any attorney of any Court of
Record to appear for VERNE CHURCHILL in such Court if this Note is note paid
when due, and at any time thereafter to confess judgment, without due process,
in favor of the holder of this Note, for such amount as may appear to be due and
unpaid thereon, together with reasonable costs of collection, including
reasonable attorney fees, and to waive and release all errors which may
intervene in any such proceedings, and to consent to immediate execution upon
judgment, hereby ratifying and confirming all that said attorney may do by
virtue hereof.
VERNE CHURCHILL TIMOTHY J. SULLIVAN
- --------------- ----------------------------
Verne Churchill Timothy J. Sullivan
Vice President and Treasurer
MARKET FACTS, INC.
<PAGE>
TERM NOTE
February 23, 1995
For value received, LAWRENCE LABASH promises to pay on April 1, 1999 to the
order of Market Facts, Inc., 3040 Salt Creek Lane, Arlington Heights, Illinois,
60005, or at any such other place as the payee or legal holder hereof may in
writing appoint, the sum of SEVENTEEN THOUSAND NINE HUNDRED THIRTY SEVEN DOLLARS
AND FIFTY CENTS ($17,937.50) together with interest.
Interest will be billed to the undersigned annually for the period of March 1
through February 28 ("Interest Rate Year") and will be calculated based upon the
balance of the Note outstanding on the first day of the Interest Rate Year. The
rate of interest will be 7.75%.
The undersigned agrees to surrender to Market Facts, Inc. 3,500 shares of Market
Facts common stock to be held as collateral for this Note until such time as the
unpaid balance of principal and interest are paid in full.
The undersigned hereby authorizes, irrevocably, any attorney of any Court of
Record to appear for LAWRENCE LABASH in such Court if this Note is note paid
when due, and at any time thereafter to confess judgment, without due process,
in favor of the holder of this Note, for such amount as may appear to be due and
unpaid thereon, together with reasonable costs of collection, including
reasonable attorney fees, and to waive and release all errors which may
intervene in any such proceedings, and to consent to immediate execution upon
judgment, hereby ratifying and confirming all that said attorney may do by
virtue hereof.
LAWRENCE LABASH TIMOTHY J. SULLIVAN
- --------------- -------------------
Lawrence Labash Timothy J. Sullivan
Vice President and Treasurer
MARKET FACTS, INC.
<PAGE>
TERM NOTE
February 23, 1995
For value received, THOMAS PAYNE promises to pay on April 1, 1999 to the order
of Market Facts, Inc., 3040 Salt Creek Lane, Arlington Heights, Illinois, 60005,
or at any such other place as the payee or legal holder hereof may in writing
appoint, the sum of TWENTY THOUSAND AND FIVE HUNDRED DOLLARS ($20,500) together
with interest.
Interest will be billed to the undersigned annually for the period of March 1
through February 28 ("Interest Rate Year") and will be calculated based upon the
balance of the Note outstanding on the first day of the Interest Rate Year. The
rate of interest will be 7.75%.
The undersigned agrees to surrender to Market Facts, Inc. 4,000 shares of Market
Facts common stock to be held as collateral for this Note until such time as the
unpaid balance of principal and interest are paid in full.
The undersigned hereby authorizes, irrevocably, any attorney of any Court of
Record to appear for THOMAS PAYNE in such Court if this Note is note paid when
due, and at any time thereafter to confess judgment, without due process, in
favor of the holder of this Note, for such amount as may appear to be due and
unpaid thereon, together with reasonable costs of collection, including
reasonable attorney fees, and to waive and release all errors which may
intervene in any such proceedings, and to consent to immediate execution upon
judgment, hereby ratifying and confirming all that said attorney may do by
virtue hereof.
THOMAS PAYNE TIMOTHY J. SULLIVAN
- ------------ -------------------
Thomas Payne Timothy J. Sullivan
Vice President and Treasurer
MARKET FACTS, INC.
<PAGE>
TERM NOTE
February 23, 1995
For value received, GLENN SCHMIDT promises to pay on April 1, 1999 to the order
of Market Facts, Inc., 3040 Salt Creek Lane, Arlington Heights, Illinois, 60005,
or at any such other place as the payee or legal holder hereof may in writing
appoint, the sum of TWENTY THOUSAND AND FIVE HUNDRED DOLLARS ($20,500) together
with interest.
Interest will be billed to the undersigned annually for the period of March 1
through February 28 ("Interest Rate Year") and will be calculated based upon the
balance of the Note outstanding on the first day of the Interest Rate Year. The
rate of interest will be 7.75%.
The undersigned agrees to surrender to Market Facts, Inc. 4,000 shares of Market
Facts common stock to be held as collateral for this Note until such time as the
unpaid balance of principal and interest are paid in full.
The undersigned hereby authorizes, irrevocably, any attorney of any Court of
Record to appear for GLENN SCHMIDT in such Court if this Note is note paid when
due, and at any time thereafter to confess judgment, without due process, in
favor of the holder of this Note, for such amount as may appear to be due and
unpaid thereon, together with reasonable costs of collection, including
reasonable attorney fees, and to waive and release all errors which may
intervene in any such proceedings, and to consent to immediate execution upon
judgment, hereby ratifying and confirming all that said attorney may do by
virtue hereof.
GLENN SCHMIDT TIMOTHY J. SULLIVAN
- ------------- -------------------
Glenn Schmidt Timothy J. Sullivan
Vice President and Treasurer
MARKET FACTS, INC.
<PAGE>
TERM NOTE
March 1, 1995
For value received, STEPHEN J. WEBER promises to pay on April 1, 1999 to the
order of Market Facts, Inc., 3040 Salt Creek Lane, Arlington Heights, Illinois,
60005, or at any such other place as the payee or legal holder hereof may in
writing appoint, the sum of SEVENTEEN THOUSAND NINE HUNDRED THIRTY SEVEN DOLLARS
AND FIFTY CENTS ($17,937.50) together with interest.
Interest will be billed to the undersigned annually for the period of March 1
through February 28 ("Interest Rate Year") and will be calculated based upon the
balance of the Note outstanding on the first day of the Interest Rate Year. The
rate of interest will be 7.75%.
The undersigned agrees to surrender to Market Facts, Inc. 7,500 shares of Market
Facts common stock to be held as collateral for this Note until such time as the
unpaid balance of principal and interest are paid in full.
The undersigned hereby authorizes, irrevocably, any attorney of any Court of
Record to appear for STEPHEN J. WEBER in such Court if this Note is note paid
when due, and at any time thereafter to confess judgment, without due process,
in favor of the holder of this Note, for such amount as may appear to be due and
unpaid thereon, together with reasonable costs of collection, including
reasonable attorney fees, and to waive and release all errors which may
intervene in any such proceedings, and to consent to immediate execution upon
judgment, hereby ratifying and confirming all that said attorney may do by
virtue hereof.
STEPHEN J. WEBER TIMOTHY J. SULLIVAN
- ---------------- -------------------
Stephen J. Weber Timothy J. Sullivan
Vice President and Treasurer
MARKET FACTS, INC.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
THE CONDENSED CONSOLIDATED BALANCE SHEET AND STATEMENT OF EARNINGS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> MAR-31-1995
<CASH> 366,066
<SECURITIES> 50,000
<RECEIVABLES> 9,974,672
<ALLOWANCES> (718,195)
<INVENTORY> 0
<CURRENT-ASSETS> 13,443,751
<PP&E> 25,038,610
<DEPRECIATION> (8,212,905)
<TOTAL-ASSETS> 31,020,927
<CURRENT-LIABILITIES> (8,979,275)
<BONDS> 0
<COMMON> (2,091,237)
0
0
<OTHER-SE> (8,422,000)
<TOTAL-LIABILITY-AND-EQUITY> (31,020,927)
<SALES> (15,333,400)
<TOTAL-REVENUES> (15,333,400)
<CGS> 8,750,625
<TOTAL-COSTS> 8,750,625
<OTHER-EXPENSES> 5,524,237
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 285,757
<INCOME-PRETAX> (808,134)
<INCOME-TAX> 390,820
<INCOME-CONTINUING> (417,314)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (417,314)
<EPS-PRIMARY> 0.23
<EPS-DILUTED> 0.23
</TABLE>
