SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Total Research Corporation
(Name of Issuer)
Common Stock, $.001 par value
(Title of Class of Securities)
89151110
(CUSIP Number)
Howard L. Shecter, Esq.
Morgan, Lewis & Bockius LLP
101 Park Avenue
New York, New York 10178
(212) 309-6000
(Name, Address and Telephone Number of
Person Authorized to Receive Notices
and Communications)
June 30, 1998
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box: [_]
Page 1 of 16 pages
<PAGE>
SCHEDULE 13D
CUSIP No. 89151110 Page 2 of 16 Pages
- --------------------------------------------------------------------------------
1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
David Brodsky
- --------------------------------------------------------------------------------
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3) SEC USE ONLY
- --------------------------------------------------------------------------------
4) SOURCE OF FUNDS
PF
- --------------------------------------------------------------------------------
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [_]
- --------------------------------------------------------------------------------
6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
7) SOLE VOTING POWER
528,961*(See Item 5)
NUMBER OF
SHARES --------------------------------------------------------------
BENEFICIALLY 8) SHARED VOTING POWER
OWNED BY See Item 5
EACH REPORTING
PERSON --------------------------------------------------------------
WITH 9) SOLE DISPOSITIVE POWER
528,961*(See Item 5)
--------------------------------------------------------------
10) SHARED DISPOSITIVE POWER
See Item 5
- --------------------------------------------------------------------------------
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
528,961*
- --------------------------------------------------------------------------------
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES [_]
- --------------------------------------------------------------------------------
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.02%*
- --------------------------------------------------------------------------------
14) TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
* Includes 70,000 shares of Common Stock issuable upon exercise of the
Stock Options (as hereinafter defined) issued to the Reporting Person.
See Item 5. The percentage listed on Row 13 above assumes the full
exercise of the Stock Options issued to the Reporting Person.
2
<PAGE>
SCHEDULE 13D
CUSIP No. 89151110 Page 3 of 16 Pages
- --------------------------------------------------------------------------------
1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Eugene Goldberg
- --------------------------------------------------------------------------------
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3) SEC USE ONLY
- --------------------------------------------------------------------------------
4) SOURCE OF FUNDS
PF
- --------------------------------------------------------------------------------
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [_]
- --------------------------------------------------------------------------------
6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
7) SOLE VOTING POWER
141,500*(See Item 5)
NUMBER OF
SHARES --------------------------------------------------------------
BENEFICIALLY 8) SHARED VOTING POWER
OWNED BY See Item 5
EACH REPORTING
PERSON --------------------------------------------------------------
WITH 9) SOLE DISPOSITIVE POWER
141,500*(See Item 5)
--------------------------------------------------------------
10) SHARED DISPOSITIVE POWER
See Item 5
- --------------------------------------------------------------------------------
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
141,500*
- --------------------------------------------------------------------------------
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES [_]
- --------------------------------------------------------------------------------
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
1.35%*
- --------------------------------------------------------------------------------
14) TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
* Includes 25,000 shares of Common Stock issuable upon exercise of the
Stock Options (as hereinafter defined) issued to the Reporting Person.
See Item 5. The percentage listed on Row 13 above assumes the full
exercise of the Stock Options issued to the Reporting Person.
3
<PAGE>
SCHEDULE 13D
CUSIP No. 89151110 Page 4 of 16 Pages
- --------------------------------------------------------------------------------
1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Donald Jacobson
- --------------------------------------------------------------------------------
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3) SEC USE ONLY
- --------------------------------------------------------------------------------
4) SOURCE OF FUNDS
PF
- --------------------------------------------------------------------------------
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [_]
- --------------------------------------------------------------------------------
6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
7) SOLE VOTING POWER
288,050*(See Item 5)
NUMBER OF
SHARES --------------------------------------------------------------
BENEFICIALLY 8) SHARED VOTING POWER
OWNED BY See Item 5
EACH REPORTING
PERSON --------------------------------------------------------------
WITH 9) SOLE DISPOSITIVE POWER
288,050*(See Item 5)
--------------------------------------------------------------
10) SHARED DISPOSITIVE POWER
See Item 5
- --------------------------------------------------------------------------------
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
288,050*
- --------------------------------------------------------------------------------
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES [_]
- --------------------------------------------------------------------------------
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
2.74%*
- --------------------------------------------------------------------------------
14) TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
* Includes 40,000 shares of Common Stock issuable upon exercise of the
Stock Options (as hereinafter defined) issued to the Reporting Person.
See Item 5. The percentage listed on Row 13 above assumes the full
exercise of the Stock Options issued to the Reporting Person.
4
<PAGE>
SCHEDULE 13D
CUSIP No. 89151110 Page 5 of 16 Pages
- --------------------------------------------------------------------------------
1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Anthony M. Lamport
- --------------------------------------------------------------------------------
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3) SEC USE ONLY
- --------------------------------------------------------------------------------
4) SOURCE OF FUNDS
PF
- --------------------------------------------------------------------------------
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [_]
- --------------------------------------------------------------------------------
6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
7) SOLE VOTING POWER
60,000*(See Item 5)
NUMBER OF
SHARES --------------------------------------------------------------
BENEFICIALLY 8) SHARED VOTING POWER
OWNED BY See Item 5
EACH REPORTING
PERSON --------------------------------------------------------------
WITH 9) SOLE DISPOSITIVE POWER
60,000*(See Item 5)
--------------------------------------------------------------
10) SHARED DISPOSITIVE POWER
See Item 5
- --------------------------------------------------------------------------------
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
60,000*
- --------------------------------------------------------------------------------
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES [_]
- --------------------------------------------------------------------------------
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.57%*
- --------------------------------------------------------------------------------
14) TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
* Includes 10,000 shares of Common Stock issuable upon exercise of the
Stock Options (as hereinafter defined) issued to the Reporting Person.
See Item 5. The percentage listed on Row 13 above assumes the full
exercise of the Stock Options issued to the Reporting Person.
5
<PAGE>
SCHEDULE 13D
CUSIP No. 89151110 Page 6 of 16 Pages
- --------------------------------------------------------------------------------
1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
George L. Lindemann
- --------------------------------------------------------------------------------
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3) SEC USE ONLY
- --------------------------------------------------------------------------------
4) SOURCE OF FUNDS
PF
- --------------------------------------------------------------------------------
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [_]
- --------------------------------------------------------------------------------
6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
7) SOLE VOTING POWER
233,050*(See Item 5)
NUMBER OF
SHARES --------------------------------------------------------------
BENEFICIALLY 8) SHARED VOTING POWER
OWNED BY See Item 5
EACH REPORTING
PERSON --------------------------------------------------------------
WITH 9) SOLE DISPOSITIVE POWER
233,050*(See Item 5)
--------------------------------------------------------------
10) SHARED DISPOSITIVE POWER
See Item 5
- --------------------------------------------------------------------------------
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
233,050*
- --------------------------------------------------------------------------------
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES [_]
- --------------------------------------------------------------------------------
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
2.22%*
- --------------------------------------------------------------------------------
14) TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
* Includes 40,000 shares of Common Stock issuable upon exercise of the
Stock Options (as hereinafter defined) issued to the Reporting Person.
See Item 5. The percentage listed on Row 13 above assumes the full
exercise of the Stock Options issued to the Reporting Person.
6
<PAGE>
SCHEDULE 13D
CUSIP No. 89151110 Page 7 of 16 Pages
- --------------------------------------------------------------------------------
1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Howard L. Schecter
- --------------------------------------------------------------------------------
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3) SEC USE ONLY
- --------------------------------------------------------------------------------
4) SOURCE OF FUNDS
PF
- --------------------------------------------------------------------------------
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [_]
- --------------------------------------------------------------------------------
6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
7) SOLE VOTING POWER
253,050*(See Item 5)
NUMBER OF
SHARES --------------------------------------------------------------
BENEFICIALLY 8) SHARED VOTING POWER
OWNED BY See Item 5
EACH REPORTING
PERSON --------------------------------------------------------------
WITH 9) SOLE DISPOSITIVE POWER
253,050*(See Item 5)
--------------------------------------------------------------
10) SHARED DISPOSITIVE POWER
See Item 5
- --------------------------------------------------------------------------------
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
253,050*
- --------------------------------------------------------------------------------
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES [_]
- --------------------------------------------------------------------------------
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
2.41%*
- --------------------------------------------------------------------------------
14) TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
* Includes 40,000 shares of Common Stock issuable upon exercise of the
Stock Options (as hereinafter defined) issued to the Reporting Person.
See Item 5. The percentage listed on Row 13 above assumes the full
exercise of the Stock Options issued to the Reporting Person.
7
<PAGE>
SCHEDULE 13D
CUSIP No. 89151110 Page 8 of 16 Pages
- --------------------------------------------------------------------------------
1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Alan L. Stuart
- --------------------------------------------------------------------------------
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3) SEC USE ONLY
- --------------------------------------------------------------------------------
4) SOURCE OF FUNDS
PF
- --------------------------------------------------------------------------------
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [_]
- --------------------------------------------------------------------------------
6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
7) SOLE VOTING POWER
141,500*(See Item 5)
NUMBER OF
SHARES --------------------------------------------------------------
BENEFICIALLY 8) SHARED VOTING POWER
OWNED BY See Item 5
EACH REPORTING
PERSON --------------------------------------------------------------
WITH 9) SOLE DISPOSITIVE POWER
141,500*(See Item 5)
--------------------------------------------------------------
10) SHARED DISPOSITIVE POWER
See Item 5
- --------------------------------------------------------------------------------
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
141,500*
- --------------------------------------------------------------------------------
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES [_]
- --------------------------------------------------------------------------------
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
1.35%*
- --------------------------------------------------------------------------------
14) TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
* Includes 25,000 shares of Common Stock issuable upon exercise of the
Stock Options (as hereinafter defined) issued to the Reporting Person.
See Item 5. The percentage listed on Row 13 above assumes the full
exercise of the Stock Options issued to the Reporting Person.
8
<PAGE>
The filing of this Statement does not constitute an admission that that
the Reporting Persons constitute a "group" for purposes of the Securities
Exchange Act of 1934, as amended, or the rules promulgated thereunder or for any
other purpose whatsoever. Each of the Reporting Persons expressly disclaims
beneficial ownership of the Common Stock beneficially owned by each of the other
Reporting Persons.
SCHEDULE 13D
ITEM 1. SECURITY AND ISSUER.
This Statement on Schedule 13D (the "Statement") relates to the Common
Stock, $.001 par value (the "Common Stock"), of Total Research Corporation, a
Delaware corporation (the "Company"). The principal executive offices of the
Company are located at Princeton Corporate Center, 5 Independence Way,
Princeton, New Jersey 08543.
ITEM 2. IDENTITY AND BACKGROUND.
(a) - (c) This Statement is being filed by David Brodsky, Eugene
Goldberg, Donald Jacobson, Anthony M. Lamport, George L. Lindemann, Howard L.
Shecter and Alan L. Stuart (collectively, the "Reporting Persons").
Mr. Brodsky is a retired private investor. His address is 2856
Hurlingham Drive, West Palm Beach, Florida 33414.
Mr. Goldberg is a retired private investor. His address is 11796
Maidstone Drive, West Palm Beach, Florida 33414.
Mr. Jacobson is a retired private investor. His address is 11928
Maidstone Drive, West Palm Beach, Florida 33414.
Mr. Lamport is the President of Lambda Fund Management, Inc., a venture
capital firm. His office address is 380 Lexington Avenue, New York, New York
10168.
Mr. Lindemann is Chairman and Chief Executive Officer of Southern Union
Company. His office address is 767 Fifth Avenue, 50th Floor, New York, New York
10153.
Mr. Shecter is a partner in the law firm of Morgan, Lewis & Bockius
LLP. His office address is 101 Park Avenue, New York, New York 10178.
Mr. Stuart is the Chairman and President of A.L. Stuart and Company,
Inc., a merchant banking firm. His office address is 599 Lexington Avenue, Suite
4102, New York, New York 10022.
(d) - (e) During the last five years, none of the Reporting Persons has
been convicted in a criminal proceeding (excluding traffic violations and
similar misdemeanors) or has been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, Federal or
State securities laws or finding any violation with respect to such laws.
9
<PAGE>
(f) Each of the Reporting Persons is a citizen of the United States.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
As of July 7, 1998, the Reporting Persons, taken together, beneficially
owned an aggregate of 1,646,111 shares of Common Stock (including 250,000 shares
issuable in the future upon exercise of the Stock Options described in Item 4
below). The aggregate purchase price for all of the 1,396,111 currently
outstanding shares of Common Stock presently owned by the Reporting Persons was
$3,015,082.75. Of the shares of Common Stock presently owned by the Reporting
Persons, 1,000,000 shares were acquired from the Company at a price of $2.25 per
share in a privately negotiated transaction pursuant to the terms of the Amended
and Restated Stock Purchase Agreement, dated as of June 18, 1998, between the
Company and David Brodsky (the "Stock Purchase Agreement"); 200,000 shares were
acquired at a price of $2.25 per share in a privately negotiated transaction
pursuant to the terms of a Letter Agreement, dated April 16, 1998, between David
Brodsky and Hugh Devine (the "Letter Agreement"); and an aggregate of 196,111
shares were acquired in various open market purchases by certain of the
Reporting Persons. Copies of the Stock Purchase Agreement and the Letter
Agreement are attached hereto as Exhibit C and Exhibit D, respectively, and are
hereby incorporated herein by reference in their entirety. The transactions
contemplated by the Stock Purchase Agreement and the Letter Agreement were
consummated on June 30, 1998, and May 7, 1998, respectively. Messrs. Goldberg,
Jacobson, Lamport, Lindemann, Shecter and Stuart each purchased the shares
listed below as purchased under the Stock Purchase Agreement and the Letter
Agreement as designees of Mr. Brodsky under such agreements. Each of the
Reporting Persons purchased the shares of Common Stock beneficially owned by
such Reporting Person with personal funds, which may, at any given time, include
margin loans made by brokerage firms in the ordinary course of business.
The individual purchases of each Reporting Person are as follows:
Mr. Brodsky purchased 121,111 shares of Common Stock in the open market
at prices ranging from $1.25 to $2.13 for aggregate consideration of
$187,930.87. He also purchased 337,850 shares of Common Stock under the Stock
Purchase Agreement and the Letter Agreement for aggregate consideration of
$760,162.50.
Mr. Goldberg purchased 116,500 shares of Common Stock under the Stock
Purchase Agreement and the Letter Agreement for aggregate consideration of
$262,125.
Mr. Jacobson purchased 55,000 shares of Common Stock in the open market
at prices ranging from $1.50 to $1.59 for aggregate consideration of $86,790. He
also purchased 193,050 shares of Common Stock under the Stock Purchase Agreement
and the Letter Agreement for aggregate consideration of $434,362.50.
Mr. Lamport purchased 50,000 shares of Common Stock under the Stock
Purchase Agreement and the Letter Agreement for aggregate consideration of
$112,500.
10
<PAGE>
Mr. Lindemann purchased 193,050 shares of Common Stock under the Stock
Purchase Agreement and the Letter Agreement for aggregate consideration of
$434,362.50.
Mr. Shecter purchased 20,000 shares of Common Stock in the open market
at prices ranging from $1.93 to $2.00 for aggregate consideration of $40,361.88.
He also purchased 193,050 shares of Common Stock under the Stock Purchase
Agreement and the Letter Agreement for aggregate consideration of $434,362.50.
Mr. Stuart purchased 116,500 shares of Common Stock under the Stock
Purchase Agreement and the Letter Agreement for aggregate consideration of
$262,125.
ITEM 4. PURPOSE OF TRANSACTION.
Each of the Reporting Persons acquired beneficial ownership of the
shares of Common Stock to which this Statement relates for investment purposes.
(a) Pursuant to the terms of the Stock Purchase Agreement, the Company
granted to Mr. Brodsky and his designees options, exercisable at any time within
five years of the Closing Date (as defined therein), to purchase an aggregate of
250,000 shares of Common Stock at an exercise price of $2.25 per share (the
"Stock Options"). See Exhibit C. Pursuant to such Stock Options, Messrs.
Brodsky, Goldberg, Jacobson, Lamport, Lindemann, Shecter and Stuart will have
the right to acquire 70,000, 25,000, 40,000, 10,000, 40,000, 40,000 and 25,000
shares of Common Stock, respectively.
Any of the Reporting Persons may acquire additional shares of Common
Stock or other securities of the Company or sell or otherwise dispose of any or
all of the shares of Common Stock or other securities of the Company
beneficially owned by such Reporting Person. Action or inaction on the part of
any one Reporting Person may be different from action or inaction on the part of
other Reporting Persons. Any of the Reporting Persons may take any other action
with respect to the Company or any of its debt or equity securities in any
manner permitted by law.
(b) None of the Reporting Persons currently has any plans or proposals
which relate to or would result in any extraordinary corporate transactions
involving the Company or any of its subsidiaries, although from time to time in
the future any of the Reporting Persons may propose or suggest to the Company
merger or acquisition transactions involving the Company and other corporations
or entities. The Stock Purchase Agreement contemplates that for a period of five
years following the Closing Date (as defined therein), subject to certain
provisions thereof, the Reporting Persons will, on a best efforts basis, assist
in providing or arranging for others to provide up to $25,000,000 in equity
financing, or debt financing to the extent such financing exceeds $5,000,000 in
the aggregate, for the Company to complete acquisitions and/or projects approved
by the Board of Directors of the Company, the form of the financing to be as
determined by the Board of Directors of the Company and to be on terms at least
as favorable as the Company could obtain from other sources not affiliated with
the Reporting Persons; provided that such covenant states that it shall not be
deemed to constitute an obligation to directly provide or underwrite financing
for
11
<PAGE>
the Company. Under certain circumstances described in the Stock Purchase
Agreement, failure to obtain specified amounts of such financing during
specified time periods may affect the Reporting Persons' rights thereunder. See
Exhibit C.
(c) None.
(d) In connection with the consummation of the transactions
contemplated by the Stock Purchase Agreement, three of the Reporting Persons,
Messrs. Brodsky, Lindemann and Shecter, were elected to the Board of Directors
of the Company and Messrs. Brodsky and Shecter were elected to the Executive
Committee of the Board of Directors of the Company.
(e) None.
(f) None.
(g) None.
(h) None.
(i) None.
(j) None.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.*
(a) As of July 7, 1998, the Reporting Persons, taken together,
beneficially owned an aggregate of 1,646,111 shares of Common Stock (including
250,000 shares issuable in the future upon exercise of the Stock Options),
representing approximately 15.35% of the outstanding shares of Common Stock
(assuming full exercise of all of the Stock Options issued to the Reporting
Persons). David Brodsky beneficially owns 528,961, or approximately 5.02%, of
the outstanding shares; Eugene Goldberg beneficially owns 141,500, or
approximately 1.35%, of the outstanding shares; Donald Jacobson beneficially
owns 288,050, or approximately 2.74%, of the outstanding shares; Anthony M.
Lamport beneficially owns 60,000, or approximately 0.57%, of the outstanding
shares; George L. Lindemann beneficially owns 233,050, or approximately 2.22%,
of the outstanding shares; Howard L. Shecter beneficially owns 253,050, or
approximately 2.41%, of the outstanding shares; and Alan L. Stuart beneficially
owns 141,500, or approximately 1.35%, of the outstanding shares.
(b) As of the date hereof, each of the Reporting Persons has sole
voting and dispositive power over the shares of Common Stock beneficially owned
by such
- --------
* All percentages in Item 5 are based upon the 10,473,000 shares of Common
Stock reported by the Company to be issued and outstanding as of May 7,
1998, and assume the full exercise of all of the Stock Options issued to
the Reporting Persons.
12
<PAGE>
Reporting Person. By reason of the contemplated relationships among the
Reporting Persons, the Reporting Persons may in the future have certain
contractual rights and obligations with respect to their respective shares of
Common Stock. See Item 6 for information relating to the proposed stockholders
agreement contemplated to be entered into among the Reporting Persons. Each of
the Reporting Persons expressly disclaims beneficial ownership of the shares of
Common Stock beneficially owned by each of the other Reporting Persons.
(c) Except for the shares of Common Stock and Stock Options purchased
pursuant to the Stock Purchase Agreement, none of the Reporting Persons have
effected any transactions in the Common Stock during the past 60 days.
(d) Not applicable.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
SECURITIES OF THE ISSUER.
The Reporting Persons are contemplating entering into a stockholders
agreement among themselves which is anticipated to contain provisions relating
to, inter alia, the voting, acquisition, sale or other disposition of their
respective shares of Common Stock (including the possibility of granting proxies
with respect thereto) and the sharing of expenses incurred in connection with
their respective acquisitions of shares of Common Stock under the Stock Purchase
Agreement and the Letter Agreement, as well as the other transactions
contemplated by the Stock Purchase Agreement.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit A - Agreement of Joint Filing
pursuant to Rule 13d-1(k)(1)
promulgated under the Securities
Exchange Act of 1934, as
amended.
Exhibit B - Powers of Attorney
13
<PAGE>
Exhibit C - Amended and Restated Stock
Purchase Agreement
Exhibit D - Letter Agreement
14
<PAGE>
SIGNATURE
After reasonable inquiry and to the best knowledge and belief
of the undersigned, the undersigned certify that the information set forth in
this Statement is true, complete and correct.
Dated: July 7, 1998
DAVID BRODSKY
By: /s/ Howard L. Shecter
-------------------------
Howard L. Shecter
Attorney-in-Fact
EUGENE GOLDBERG
By: /s/ Howard L. Shecter
-------------------------
Howard L. Shecter
Attorney-in-Fact
DONALD JACOBSON
By: /s/ Howard L. Shecter
-------------------------
Howard L. Shecter
Attorney-in-Fact
ANTHONY M. LAMPORT
By: /s/ Howard L. Shecter
-------------------------
Howard L. Shecter
Attorney-in-Fact
GEORGE L. LINDEMANN
By: /s/ Howard L. Shecter
-------------------------
Howard L. Shecter
Attorney-in-Fact
15
<PAGE>
/s/ Howard L. Shecter
---------------------
Howard L. Shecter
ALAN L. STUART
By: /s/ Howard L. Shecter
-------------------------
Howard L. Shecter
Attorney-in-Fact
16
<PAGE>
Exhibit A
Agreement of Joint Filing
Pursuant to 13d-1(k)(1) promulgated under the Securities Exchange Act
of 1934, as amended, the undersigned persons hereby agree to file with the
Securities and Exchange Commission the Statement on Schedule 13D (the
"Statement") to which this Agreement is attached as an exhibit, and agree that
such Statement, as so filed, is filed on behalf of each of them.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the 30th day of June, 1998.
/s/ David Brodsky
-----------------
David Brodsky
/s/ Eugene Goldberg
-------------------
Eugene Goldberg
/s/ Donald Jacobson
-------------------
Donald Jacobson
/s/ Anthony M. Lamport
----------------------
Anthony M. Lamport
/s/ George L. Lindemann
-----------------------
George L. Lindemann
/s/ Howard L. Shecter
---------------------
Howard L. Shecter
/s/ Alan L. Stuart
------------------
Alan L. Stuart
<PAGE>
Exhibit B
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that Eugene Goldberg, constitutes
and appoints David Brodsky and Howard Shecter, and each of them, as his true and
lawful attorney-in-fact and agent, with full power of substitution, for his and
in his name, place and stead, in any and all capacities, to execute any and all
documents or instruments and take any and all other actions as said
attorney-in-fact and agent shall deem appropriate in connection with any matter
relating to the filing of a Schedule 13D (including any amendments thereto) with
the United States Securities and Exchange Commission in connection with the
acquisition of common stock of Total Research Corporation, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every thing requisite and necessary to be done in connection therewith, as fully
to all intents and purposes as he might or could do in person, hereby ratifying
and confirming all that said attorney-in-fact and agent may lawfully do or cause
to be done by virtue hereof.
The undersigned agrees to hold the attorney-in-fact and agent free and
harmless from any and all loss, claim, damage or other liability which he may
sustain as a result of any action taken in good faith hereunder.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney
on May 14, 1998.
/s/ Eugene Goldberg
-------------------
Eugene Goldberg
STATE of New York |
| ss.:
COUNTY of New York |
BE IT KNOWN, That on the 14th day of May, 1998 before me, Nancy Wong,
personally came and appeared Eugene Goldberg, to me known, and known to me to be
the individual described in, and who executed the foregoing Power of Attorney,
and he acknowledged to me that he executed same.
/s/ Nancy Wong
--------------
[SEAL] Nancy Wong
<PAGE>
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that Donald Jacobson, constitutes
and appoints David Brodsky and Howard Shecter, and each of them, as his true and
lawful attorney-in-fact and agent, with full power of substitution, for his and
in his name, place and stead, in any and all capacities, to execute any and all
documents or instruments and take any and all other actions as said
attorney-in-fact and agent shall deem appropriate in connection with any matter
relating to the filing of a Schedule 13D (including any amendments thereto) with
the United States Securities and Exchange Commission in connection with the
acquisition of common stock of Total Research Corporation, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every thing requisite and necessary to be done in connection therewith, as fully
to all intents and purposes as he might or could do in person, hereby ratifying
and confirming all that said attorney-in-fact and agent may lawfully do or cause
to be done by virtue hereof.
The undersigned agrees to hold the attorney-in-fact and agent
free and harmless from any and all loss, claim, damage or other liability which
he may sustain as a result of any action taken in good faith hereunder.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney on May 14, 1998.
/s/ Donald Jacobson
-------------------
Donald Jacobson
STATE of Florida |
| ss.:
COUNTY of West Palm Beach |
BE IT KNOWN, That on the 14th day of May, 1998 before me, Marlene
Tackett, personally came and appeared Donald Jacobson, to me known, and known to
me to be the individual described in, and who executed the foregoing Power of
Attorney, and he acknowledged to me that he executed same.
/s/ Marlene Tackett
-------------------
[SEAL] Marlene Tackett
<PAGE>
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that Anthony Lamport, constitutes
and appoints David Brodsky and Howard Shecter, and each of them, as his true and
lawful attorney-in-fact and agent, with full power of substitution, for his and
in his name, place and stead, in any and all capacities, to execute any and all
documents or instruments and take any and all other actions as said
attorney-in-fact and agent shall deem appropriate in connection with any matter
relating to the filing of a Schedule 13D (including any amendments thereto) with
the United States Securities and Exchange Commission in connection with the
acquisition of common stock of Total Research Corporation, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every thing requisite and necessary to be done in connection therewith, as fully
to all intents and purposes as he might or could do in person, hereby ratifying
and confirming all that said attorney-in-fact and agent may lawfully do or cause
to be done by virtue hereof.
The undersigned agrees to hold the attorney-in-fact and agent free and
harmless from any and all loss, claim, damage or other liability which he may
sustain as a result of any action taken in good faith hereunder.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney
on June 24, 1998.
/s/ Anthony Lamport
-------------------
Anthony Lamport
STATE of New York |
| ss.:
COUNTY of New York |
BE IT KNOWN, That on the 24th day of June, 1998 before me, Mina Vitale,
personally came and appeared Anthony Lamport, to me known, and known to me to be
the individual described in, and who executed the foregoing Power of Attorney,
and he acknowledged to me that he executed same.
/s/ Mina Vitale
---------------
[SEAL] Mina Vitale
<PAGE>
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that Alan Stuart, constitutes and
appoints David Brodsky and Howard Shecter, and each of them, as his true and
lawful attorney-in-fact and agent, with full power of substitution, for his and
in his name, place and stead, in any and all capacities, to execute any and all
documents or instruments and take any and all other actions as said
attorney-in-fact and agent shall deem appropriate in connection with any matter
relating to the filing of a Schedule 13D (including any amendments thereto) with
the United States Securities and Exchange Commission in connection with the
acquisition of common stock of Total Research Corporation, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every thing requisite and necessary to be done in connection therewith, as fully
to all intents and purposes as he might or could do in person, hereby ratifying
and confirming all that said attorney-in-fact and agent may lawfully do or cause
to be done by virtue hereof.
The undersigned agrees to hold the attorney-in-fact and agent free and
harmless from any and all loss, claim, damage or other liability which he may
sustain as a result of any action taken in good faith hereunder.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney
on May 14, 1998.
/s/ Alan Stuart
---------------
Alan Stuart
STATE of New York |
| ss.:
COUNTY of New York |
BE IT KNOWN, That on the 14th day of May, 1998 before me, Edward J.
Polito, personally came and appeared Alan Stuart, to me known, and known to me
to be the individual described in, and who executed the foregoing Power of
Attorney, and he acknowledged to me that he executed same.
/s/ Edward J. Polito
--------------------
[SEAL] Edward J. Polito
<PAGE>
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that David Brodsky, constitutes and
appoints Howard Shecter as his true and lawful attorney-in-fact and agent, with
full power of substitution, for his and in his name, place and stead, in any and
all capacities, to execute any and all documents or instruments and take any and
all other actions as said attorney-in-fact and agent shall deem appropriate in
connection with any matter relating to the filing of a Schedule 13D (including
any amendments thereto) with the United States Securities and Exchange
Commission in connection with the acquisition of common stock of Total Research
Corporation, granting unto said attorney-in-fact and agent full power and
authority to do and perform each and every thing requisite and necessary to be
done in connection therewith, as fully to all intents and purposes as he might
or could do in person, hereby ratifying and confirming all that said
attorney-in-fact and agent may lawfully do or cause to be done by virtue hereof.
The undersigned agrees to hold the attorney-in-fact and agent free and
harmless from any and all loss, claim, damage or other liability which he may
sustain as a result of any action taken in good faith hereunder.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney
on May 14, 1998.
/s/ David Brodsky
-----------------
David Brodsky
STATE of Rhode Island |
| ss.:
COUNTY of Newport |
BE IT KNOWN, That on the 14th day of May, 1998 before me, Marc A. Pine,
personally came and appeared David Brodsky, to me known, and known to me to be
the individual described in, and who executed the foregoing Power of Attorney,
and he acknowledged to me that he executed same.
/s/ Marc A. Pine
----------------
[SEAL] Marc A. Pine
<PAGE>
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that Howard Shecter, constitutes
and appoints David Brodsky as his true and lawful attorney-in-fact and agent,
with full power of substitution, for his and in his name, place and stead, in
any and all capacities, to execute any and all documents or instruments and take
any and all other actions as said attorney-in-fact and agent shall deem
appropriate in connection with any matter relating to the filing of a Schedule
13D (including any amendments thereto) with the United States Securities and
Exchange Commission in connection with the acquisition of common stock of Total
Research Corporation, granting unto said attorney-in-fact and agent full power
and authority to do and perform each and every thing requisite and necessary to
be done in connection therewith, as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all that said
attorney-in-fact and agent may lawfully do or cause to be done by virtue hereof.
The undersigned agrees to hold the attorney-in-fact and agent free and
harmless from any and all loss, claim, damage or other liability which he may
sustain as a result of any action taken in good faith hereunder.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney
on May 14, 1998.
/s/ Howard Shecter
------------------
Howard Shecter
STATE of Pennsylvania |
| ss.:
COUNTY of Philadelphia |
BE IT KNOWN, That on the 14th day of May, 1998 before me, Astrid
Karnas, personally came and appeared Howard Shecter, to me known, and known to
me to be the individual described in, and who executed the foregoing Power of
Attorney, and he acknowledged to me that he executed same.
/s/ Astrid Karnas
-----------------
[SEAL] Astrid Karnas
<PAGE>
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that George L. Lindemann,
constitutes and appoints David Brodsky and Howard Shecter, and each of them, as
his true and lawful attorney-in-fact and agent, with full power of substitution,
for his and in his name, place and stead, in any and all capacities, to execute
any and all documents or instruments and take any and all other actions as said
attorney-in-fact and agent shall deem appropriate in connection with any matter
relating to the filing of a Schedule 13D (including any amendments thereto) with
the United States Securities and Exchange Commission in connection with the
acquisition of common stock of Total Research Corporation, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every thing requisite and necessary to be done in connection therewith, as fully
to all intents and purposes as he might or could do in person, hereby ratifying
and confirming all that said attorney-in-fact and agent may lawfully do or cause
to be done by virtue hereof.
The undersigned agrees to hold the attorney-in-fact and agent free and
harmless from any and all loss, claim, damage or other liability which he may
sustain as a result of any action taken in good faith hereunder.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney
on July 2, 1998.
/s/ George L. Lindemann
-----------------------
George L. Lindemann
STATE of New York |
| ss.:
COUNTY of New York |
BE IT KNOWN, That on the 2nd day of July, 1998 before me, Carline
Banatte, personally came and appeared George L. Lindemann, to me known, and
known to me to be the individual described in, and who executed the foregoing
Power of Attorney, and he acknowledged to me that he executed same.
/s/ Carline Banatte
-------------------
[SEAL] Carline Banatte
<PAGE>
Exhibit C
---------
AMENDED AND RESTATED STOCK PURCHASE AGREEMENT
AMENDED AND RESTATED STOCK PURCHASE AGREEMENT (the "Agreement") made as
of June 18, 1998 among TOTAL RESEARCH CORPORATION, a Delaware corporation (the
"Company"), and DAVID BRODSKY, of Wellington, Florida, as the representative for
an entity or group to be formed (the "Purchaser").
BACKGROUND
A. The parties have entered into a Stock Purchase Agreement dated as of
April 16, 1998 (the "Original Stock Purchase Agreement"), providing, among other
things, for the sale by the Company to the Purchaser and his designees
identified on Schedule 1.1 to the Original Stock Purchase Agreement
(collectively, the "Designees") of one million (1,000,000) of the authorized but
unissued shares of Common Stock, $.001 par value per share, of the Company (the
"Purchased Securities").
B. Pursuant to Article VI of the Original Stock Purchase Agreement,
during the five (5) year period following the Closing Date, the Purchaser and
the Designees have agreed to provide or arrange for others to provide up to
$25,000,000.00 in debt or equity financing for the Company to complete
acquisitions and/or projects approved by the Board of Directors, subject to the
limitations contained in the Original Stock Purchase Agreement.
C. The Purchaser and the Designees have requested that the Original
Stock Purchase Agreement be amended and restated to modify the terms and
conditions of their financing obligations under Article VI thereof in
consideration of other modifications to the Original Stock Purchase Agreement.
NOW, THEREFORE, in consideration of the foregoing and the covenants
herein contained, the parties hereto, intending to be legally bound, agree as
follows:
ARTICLE I
SALE AND PURCHASE OF PURCHASED SECURITIES
SECTION 1.1. Sale and Purchase. Subject to all of the terms and
conditions hereof and in reliance on the representations and warranties set
forth or referred to herein, at the Closing the Company agrees to issue and sell
to the Purchaser and his designees, as listed in Schedule 1.1 (the "Designees"),
at a price of $2.25 per share (the "Per Share Price"), and the Purchaser, for
himself and the Designees, hereby agrees to purchase, the Purchased Securities.
SECTION 1.2. Option Shares. In addition, at the Closing the Company
shall issue and deliver to the Purchaser and the Designees an option to purchase
an aggregate of two hundred fifty thousand (250,000) shares of the authorized
but unissued shares of Common Stock of the Company at the Per Share Price. This
option shall be exercisable at any time within five (5) years from the Closing
Date; provided, however, that any shares of Company stock purchased
<PAGE>
upon the exercise of the option shall be subject to the Company's right of
repurchase in Article VI until the earlier of (i) the date after the thirty (30)
day period following the twenty-four (24) month anniversary of the Closing Date
described in Article VI hereof has expired, or (ii) the date that the Company
has acknowledged in writing that the Purchaser and the Designees have fulfilled
their $5 million financing undertaking as set forth in said Article VI. The
grant of this option shall be evidenced by an Option Agreement between the
Company and the Purchaser and the Designees, in form satisfactory to the parties
and containing terms and conditions customarily found in option agreements of
like nature, including provisions for the adjustment of the number of shares
subject to the option and the Per Share Price in the event of a stock dividend,
stock split, reorganization, merger or other adjustment in the capitalization of
the Company. Any shares purchased pursuant to the option grant shall contain an
appropriate legend reflecting the restrictions contained herein.
SECTION 1.3. Closing. The closing of the purchase and sale of the
Purchased Securities (the "Closing") will take place at the offices of the
Company, Princeton Corporate Center, 5 Independence Way, Princeton, New Jersey,
at 10:00 A.M. on July 1, 1998 (the "Closing Date"); provided, however, that, to
the extent necessary, the Company and the Purchaser may delay the Closing Date
up to August 1, 1998 if all conditions precedent in Article IV and V have not
been fully satisfied or waived. If the conditions precedent in Articles IV and V
have not been fully satisfied or waived by August 1, 1998, then such conditions
will be deemed waived on such date unless the Purchaser (in the event of
nonsatisfaction of a condition in Article IV) or the Company (in the event of
nonsatisfaction of a condition in Article V) gives written notice of termination
of this Agreement to the other party before 5:00 P.M. on August 1, 1998. At the
Closing, the Company will deliver to the Purchaser the Purchased Securities
against payment of the Per Share Price therefor for each Purchased Security by
wire transfer or check in immediately available funds on or before the Closing
Date. The Purchased Securities will be issued on or before the Closing Date, and
registered to the Purchaser and the Designees as he shall direct.
SECTION 1.4. Change of Designees. Any additions to the individuals
listed as Designees in Schedule 1.1 shall be made only if the Company is
reasonably satisfied that the individual to be added is of a character, status
and financial capability comparable to the Purchaser and the Designees.
SECTION 1.5. Use of Proceeds. Proceeds from the sale of the Purchased
Securities hereunder shall be used for working capital and general corporate
purposes as determined from time to time by the Company's Board of Directors.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
In order to induce the Purchaser to enter into this Agreement and to
purchase the Purchased Securities, the Company hereby represents and warrants
that:
SECTION 2.1. Organization and Good Standing. The Company is duly
organized, validly existing and in good standing in its jurisdiction of
incorporation and is duly qualified as a
2
<PAGE>
foreign corporation and authorized to do business in all other jurisdictions in
which the nature of its business or property makes such qualification necessary
and where the failure to so qualify would not have a material adverse effect on
the Company's financial position or results of operations.
SECTION 2.2. Authorization. The execution, delivery and performance by
the Company of this Agreement, and the issuance and sale by the Company of the
Purchased Securities hereunder: (a) are within the Company's power and
authority; (b) have been duly authorized by all necessary corporate proceedings;
and (c) do not and will not result in the creation of any lien upon any of the
Company's property or conflict with or result in any breach of any provision of
the Company's charter or by-laws or any law, regulation, order, judgment, writ,
injunction, license, permit, agreement or instrument to which the Company is
subject.
SECTION 2.3. Due Issuance. When issued and paid for, the Purchased
Securities will be validly issued and outstanding and will be fully paid and
non-assessable.
SECTION 2.4. Consents. The execution, delivery and performance by the
Company of this Agreement, and the issuance and sale of the Purchased Securities
hereunder, do not and will not require the approval or consent of, or any filing
with, any governmental authority or agency or any other person other than a
Notice of Sale of Securities Pursuant to Regulation D under the Securities Act
of 1933, as amended, and any required state securities law filings relating to
the issuance and sale of the Purchased Securities which have been filed or are
permitted to be filed after the date of such issuance and sale.
SECTION 2.5. Reports and Financial Statements; Undisclosed Liabilities.
(a) The Purchasers have heretofore been furnished with complete and
correct copies of all Form 10-K, 10-Q and 8-K filings with the Securities and
Exchange Commission in the past three years (the "SEC Reports").
(b) Except as otherwise specifically disclosed in the SEC Reports, the
Financial Statements set forth therein for the year ended June 30, 1996 and for
periods thereafter (the "Financial Statement") were prepared in accordance with
generally accepted accounting principles applied on a basis consistent with
prior periods except as otherwise stated therein; each of the balance sheets
included in Financial Statements fairly presents the financial condition of the
as at the close of business on the date thereof; and each of the statements of
income included in the Financial Statements fairly presents the results of
operations of the Company for the fiscal period then ended. The Company has no
liabilities or obligations of any nature, whether absolute, accrued, contingent
or otherwise, which are required to be reflected or reserved against, but are
not so reflected or reserved against in the Financial Statements, except for
liabilities that may have arisen in the ordinary and usual course of business
and consistent with past practice and that individually or in the aggregate do
not have and could not reasonably be expected to have a material adverse effect
on the financial position or the results of operations of the Company.
3
<PAGE>
SECTION 2.6. Tax Returns. The Company has filed all tax returns and
reports which are required to be filed with any foreign, federal, state or local
governmental authority or agency and has paid all taxes which have become due,
and made adequate provision for the payment of all taxes that will become due,
under applicable foreign, federal, state or local governmental law or
regulations with respect to the periods in respect of which such returns and
reports were filed, and all assessments of taxes. The Company has made adequate
provisions for all current taxes.
SECTION 2.7. Title to Assets. The Company owns all of its assets, and
has good and marketable title with respect thereto, reflected in the Financial
Statements of the Company free and clear of all liens other than those disclosed
in the Financial Statements.
SECTION 2.8. Necessary Property; Condition of Property. To the best
knowledge of the Company, the properties and assets owned, leased by or licensed
to the Company, and reflected in the Financial Statements constitute all of the
real and personal properties, tangible and intangible, which are necessary, used
or useful in the conduct of its business in the manner and to the extent
presently conducted or as presently contemplated to be conducted; and no other
material real or personal properties are required for the conduct of the
business of the Company as presently conducted.
SECTION 2.9. Necessary Licenses and Permits. To the best knowledge of
the Company, the Company has all licenses, permits, consents, concessions and
other authorizations of governmental, regulatory or administrative agencies or
authorities, whether foreign, federal, state, or local, required to own and
lease its properties and assets and to conduct its business as now conducted
except where the failure to have such permits would not have a material adverse
effect on the results of operations or the financial position of the Company.
SECTION 2.10. Compliance with Law. The Company is in compliance in all
material respects with all applicable laws, regulations, orders, judgments,
decrees, permits, licenses, franchises and authorizations.
SECTION 2.11. Litigation. Except as set forth in Schedule 2.11, there
is no suit, claim, action, proceeding or investigation pending or, to the
Company's knowledge, threatened against the Company or any of its assets or
properties, and to the best knowledge of the Company, there is no reasonable
basis for any such suit, claim, action, proceeding or investigation.
SECTION 2.12. No Material Adverse Changes. Since the date of the latest
of the Financial Statements, there has occurred no material adverse change in
the business, assets, properties (tangible and intangible), operations,
condition (financial or otherwise) or liabilities of the Company, whether or not
in the ordinary course of business, whether separately or in the aggregate with
other occurrences or developments, and whether insured against or not, and the
Company has no knowledge of any occurrence or development which might reasonably
be expected to result in any such material adverse effect.
SECTION 2.13. Disclosure. No representation, warranty or statement made
in this Agreement, or any agreement, certificate, statement or document
furnished by or on behalf of the Company in connection with the purchase of the
Purchased Securities contains or will contain
4
<PAGE>
any untrue statement of material fact or omits to state a material fact
necessary in order to make the statements contained herein or therein, in light
of the circumstances in which they were made, not misleading.
ARTICLE III
PURCHASER'S REPRESENTATIONS
SECTION 3.1. Investment Intent. The Purchaser hereby represents and
warrants to the Company that he is (and each such Designee will be) (i) an
"accredited investor" as defined in Regulation D of the Securities Act of 1933,
as amended (the "Securities Act") and (ii) acquiring the Purchased Securities
for investment and not with a view to the distribution thereof.
SECTION 3.2. Exemption. The Purchaser understands that the Purchased
Securities are not, and will not be, registered under the Securities Act on the
grounds that the sale provided for in this Agreement and the issuance of
securities hereunder is exempt from registration under the Securities Act
pursuant to section 4(2) thereof, and that the Company's reliance on such
exemption is predicated on the Purchaser's representations set forth herein.
SECTION 3.3. Experience. The Purchaser represents that he is
experienced in evaluating and investing in companies such as the Company, is
familiar with the risks associated with the business and operations of companies
that operate in the market research industry, has such knowledge and experience
in financial and business matters as to be capable of evaluating the merits and
risks of his investment, and has the ability to bear the economic risks of his
investment. The Purchaser represents that he has had, during the course of the
transaction and prior to his purchase of the Purchased Securities, the
opportunity to request information from and ask questions of the Company and its
officers, employees and agents, concerning the Company, its assets, business and
operations and to receive information and answers to such requests and
questions.
SECTION 3.4. Restrictions on Resale. The Purchaser understands that the
Purchased Securities may not be sold, transferred, or otherwise disposed of
without registration under the Securities Act or an exemption therefrom, and
that in the absence of an effective registration statement covering the
Purchased Securities or an available exemption from registration under the
Securities Act, the Purchased Securities must be held indefinitely. The
Purchaser agrees that in no event will he make a transfer or disposition of any
of the Purchased Securities (other than pursuant to an effective registration
statement under the Securities Act), unless and until (i) the Purchaser shall
have notified the Company of the proposed disposition and (ii) if requested by
the Company, the Purchaser shall have furnished to the Company at the expense of
the Purchaser or his transferee, an opinion of counsel reasonably satisfactory
to the Company to the effect that such transfer may be made without registration
under the Securities Act.
SECTION 3.5. Financial Ability. The Purchaser and the Designees
together possess the financial resources to fulfill their obligations under this
Agreement.
5
<PAGE>
ARTICLE IV
CONDITIONS TO THE PURCHASER'S OBLIGATIONS TO PURCHASE
The Purchaser's obligation to purchase the Purchased Securities
pursuant to Section 1.1 of this Agreement is subject to compliance by the
Company with its agreements and representations herein contained, and to the
satisfaction, on or prior to the Closing Date, of the following conditions:
SECTION 4.1. Charter Documents; Good Standing Certificates. The
Purchaser shall have received from the Company (a) a copy of the Company's
Certificate of Incorporation, certified by the Delaware Secretary of State to be
true and complete as of a date no more than five days prior to the Closing Date,
(b) a copy, certified by the Secretary of the Company to be true and complete as
of the Closing Date, of the by-laws thereof; and (c) a certificate, dated not
more than five days prior to the date hereof, of the relevant governmental
authority or other appropriate official of each state in which each of the
Company is incorporated or qualified to do business, as to the Company's
corporate good standing in such state or qualification to do business, as the
case may be.
SECTION 4.2. Proof of Corporate Action. The Purchaser shall have
received from the Company copies certified by the Secretary thereof to be true
and complete as of the Closing Date, of the records of all corporate action
taken (a) to authorize the execution, delivery and performance of this
Agreement; (b) to increase the size of the Board of Directors, to remove or
accept the resignations of existing members of the Board of Directors and to
elect new members to the Board of Directors, in such a manner so that the Board
of Directors immediately after Closing consists of eight (8) members, comprised
of David Brodsky ("Brodsky"), Howard L. Shecter ("Shecter"), and George L.
Lindemann, and five (5) of the Company's incumbent directors (collectively, the
"Director Slate"), as approved by resolution of the Board of Directors; (c) to
approve the Director Slate for submission to a vote of the stockholders of the
Company for election at the next annual or special meeting thereof; (d) to
designate an Executive Committee consisting of the Chief Executive Officer,
Brodsky, Shecter and a fourth member with substantial experience in the market
research industry, to be selected by the majority vote of the other three
members of the Executive Committee; (e) to provide that, between the meetings of
the Board of Directors and while the Board of Directors is not in session, the
Executive Committee shall have the following primary responsibilities: (i) to
create opportunities in the form of acquisitions of other companies or
additional lines of business and (ii) to oversee strategic business planning and
shall also generally have the responsibility of acting on behalf of the Board of
Directors between meetings of the Board, subject to the Board's right at any
duly convened meeting to overrule any decision or act of the Executive
Committee; (f) to appoint Brodsky as Chairman of the Executive Committee with
one additional vote if the Executive Committee is deadlocked on any matter; (g)
to designate a Nominating Committee consisting of Brodsky and the Chief
Executive Officer; (h) to provide that, between the meetings of the Board of
Directors and while the Board of Directors is not in session, the Nominating
Committee shall have the following powers: (i) to nominate individuals to fill
any vacancies on the Board of Directors, (ii) to nominate, subject to Board
approval, a slate of individuals to the Board of Directors to be submitted to a
vote of the stockholders of the Company at a meeting where the election of
Directors is to be voted upon,
6
<PAGE>
and (iii) to perform such other duties and to exercise such other powers as may
be determined from time to time by resolution adopted by the Board of Directors;
and (i) to provide for the Executive and Nominating Committees to continue as so
constituted until the earlier to occur of (i) the Purchaser's and Designees'
undertakings in Article VI have been fully satisfied or (ii) the Company in good
faith determines that the Purchaser or the Designees have breached their
undertaking in Article VI.
SECTION 4.3. Representations and Warranties; Officer's Certificate. The
representations and warranties contained or incorporated by reference herein
shall be true and correct in all material respects on and as of the Closing Date
with the same force and effect as though made on and as of the Closing Date
except for those representations and warranties which relate specifically to a
particular date, provided that such representations and warranties were true and
correct in all material respects as of such date; and the Company shall have
performed and complied with all conditions and agreements required to be
performed or complied with by it prior to the Closing; and the Purchaser shall
have received on the Closing Date a certificate to these effects signed by an
authorized officer of the Company.
SECTION 4.4. Legality; Governmental and Other Authorizations. The
purchase of the Purchased Securities by the Purchaser and the Designees shall
not be prohibited by any law or governmental order or regulation, and shall not
subject the Purchaser to any penalty, special tax, or other onerous condition.
All necessary consents, approvals, licenses, permits, orders and authorizations
of, or registrations, declarations and filings with, any governmental or
administrative agency, with respect to any of the transactions contemplated by
this Agreement, shall have been duly obtained or made and shall be in full force
and effect.
SECTION 4.5. Due Diligence. The Company shall have granted the
Purchaser full access to the Company's records and its officers, immediately
upon execution hereof, in order to conduct a thorough due diligence review, and
the Purchaser shall have completed a legal, accounting and business due
diligence review of the Company (which he agrees to complete within 14 days of
the date of this Agreement, subject to an extension of 14 additional days, up to
28 days if the Company is unable to provide the contemplated full access in said
14-day period) and the results thereof shall not have revealed material
liabilities or significant issues adversely affecting the Company and not
disclosed in the SEC Reports.
SECTION 4.6. Management Contracts. The Company shall have entered into
an employment agreements with members of the Company's Management Council and
other key employees to be identified by the parties, each agreement to contain
terms and conditions and to be in form satisfactory to the Purchaser, the
Company and the contracting employee.
ARTICLE V
CONDITIONS TO THE COMPANY'S OBLIGATIONS
The Company's obligation to sell and issue the Purchased Securities
pursuant to this Agreement is subject to compliance by the Purchaser with the
agreements herein contained, and to the satisfaction on or prior to the Closing
Date, of the following conditions:
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SECTION 5.1. Representations. The representations made by the Purchaser
in Article III hereof shall be true and correct in all material respects when
made and shall be true and correct in all material respects as of the Closing
Date.
SECTION 5.2. Designee Documentation. The Purchaser shall identify each
of the designees of the Purchaser who will purchase Purchased Securities and who
will have the same registered in his, hers or its name, and by the Closing each
such designee shall have executed and delivered to the Company an instrument, in
form reasonably satisfactory to the Company, by which he, she or it (a) agrees
to become a party to this Agreement, to make the representations and warranties
made by the Purchaser in Article III hereof as to himself, herself or itself
only and to be fully bound by the terms and conditions hereof, and (b)
specifically joins in the covenant the Purchaser has made in Article VI hereof.
SECTION 5.3. Company's Due Diligence. The Company shall have completed
a due diligence review of the Purchaser and his designees who will acquire
Purchased Securities, shall have verified that the representations contained in
biographies submitted by them are accurate in all significant respects and shall
have made a determination, to be made in good faith, that having the Purchaser
and the Designees as shareholders will not adversely affect the Company or its
position and reputation in its industry.
SECTION 5.4. Management Contracts. The Company shall have offered to
enter into employment agreements with the members of the Company's Management
Council and other key employees to be identified, each agreement so offered to
contain terms and conditions and to be in form satisfactory to the Purchaser and
the Company.
SECTION 5.5. Governmental and Other Authorizations. All necessary
consents, approvals, licenses, permits, orders and authorizations of, or
registrations, declarations and filings with, any governmental or administrative
agency, with respect to any of the transactions contemplated by this Agreement,
shall have been duly obtained or made and shall be in full force and effect,
provided that the Company shall have exercised its best efforts to obtain such
consents and approvals.
SECTION 5.6. Corporate Action. The corporate action contemplated in
Section 4.2 hereof shall have been taken.
SECTION 5.7. Nasdaq Approval. The Company shall have received approval
of the transactions contemplated by this Agreement from The Nasdaq Stock Market,
Inc.
ARTICLE VI
SPECIAL COVENANT
During the five (5) year period following the Closing Date, the
Purchaser and the Designees will, on a best efforts basis, assist in providing
or arranging for others to provide up to $25 million in equity financing, or
debt financing to the extent such financing exceeds $5 million in the aggregate,
for the Company to complete acquisitions and/or projects approved by the
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Board of Directors, the form of the financing to be as determined by the Board
of Directors and to be on terms at least as favorable as the Company could
obtain from other sources not affiliated with the Purchaser; provided, that this
covenant shall not be deemed to constitute an obligation to directly provide or
underwrite financing for the Company. Notwithstanding the foregoing, if during
the first twenty-four (24) months following the Closing Date, (i) The Board of
Directors has approved acquisitions and projects costing a minimum of $5 million
in the aggregate (the "Approved Acquisitions or Projects") and (ii) the
Purchaser or the Designees have either (x) not voted as a Board member in favor
of any Approved Acquisitions or Projects or (y) voted as a Board member in favor
of any Approved Acquisition or Projects and the Purchaser and the Designees have
not provided, or caused others to provide, the full $5 million in financing as
described above, then during a thirty (30) day period following the twenty-four
(24) month anniversary of the Closing Date, the Company shall have the right to
(x) purchase the Purchased Securities at ninety percent (90%) of the then market
price of the Company's Common Stock, and (y) cancel all options under Section
1.2. In order for the Company to exercise its right described in the preceding
sentence, a majority vote of the Board of Directors (other than the Purchaser
and the Designees) must have approved such repurchase. For purposes of this
Article VI, market price is to be determined by averaging the closing price of
the Common Stock for the ten (10) trading days prior to the exercise of the
right to repurchase. To the extent the Purchaser and/or the Designees have
provided, or caused others to provide, at least $12,500,000 of the financing
undertaking described above, the Purchaser shall be entitled to have the
Purchaser and the Designees constitute one-half of the members of the Director
Slate for approval of the stockholders at the next annual meeting called for
such purpose and a majority of the Director Slate once the full $25 million
undertaking has been satisfied. In the event of a breach by Purchaser or
Designees of the undertakings described in this Article VI, the Company's sole
and exclusive remedies hereunder shall be (i) the stock repurchase and option
cancellation remedies with respect to the nonsatisfaction of the above described
$5 million undertaking during the first 24 months and (ii) the right to disband
the Executive and Nominating Committees and have the Purchaser and Designees
ineligible for future Directors' Slates during the five (5) year period covered
by this Article VI, which ineligibility the Purchaser and Designees consent to
in the event that Purchaser or Designees have breached their undertaking
described in this Article VI and (x) the Board has determined to implement the
stock repurchase and option cancellation remedies (with respect to the $5
million undertaking), or (y) following the first 24 months, the Board has
determined that the Purchaser and the Designees have breached the $25 million
undertaking. A breach of this Article VI shall not exist unless and until the
Board has delivered to Purchaser a copy of a resolution duly adopted by a
majority of the Board at a meeting of the Board called and held for such
purpose, finding that a breach exists in the good faith opinion of the Board and
specifying the essential facts underlying its determination. This Article shall
not prevent Purchaser or the Designees from challenging in any court of
competent jurisdiction the Board's determination that a breach has occurred. The
Board must provide notice to Purchaser that it is intending to declare Purchaser
or Designees in breach of this Article at least 48 hours before the Board
meeting at which such action is to be voted upon, and, with respect to the $25
million undertaking, the Board must provide the Purchaser and the Designees with
at least 30 days written notice and an opportunity to cure in the event the
Board determines that the Purchaser and the Designees have breached such
undertaking.
9
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ARTICLE VII
EXPENSES
In the event the transactions contemplated by this Agreement shall be
consummated or if the transactions contemplated by this Agreement are not
consummated by reason of the failure by the Company to so consummate when
legally obligated to do so hereunder, the Company hereby agrees to pay all
reasonable out of pocket fees, costs and expenses incurred by the Purchaser
(such as travel, photocopy and telephone expenses and including the expenses of
one counsel for the Purchaser), up to a maximum of $50,000.00, which amounts
shall be treated as an adjustment to the purchase price for the Purchased
Securities.
ARTICLE VIII
NOTICES
All demands, notices, requests, consents and other communications
required or permitted under this Agreement shall be in writing and shall be
personally delivered or sent by facsimile machine (with a confirmation copy sent
by one of the other methods authorized in this Section), commercial (including
FedEx) or U.S. Postal Service overnight delivery service, or, deposited with the
U.S. Postal Service mailed first class, registered or certified mail, postage
prepaid, as set forth below:
If to the Company, addressed to:
Total Research Corporation
Princeton Corporate Center
5 Independence Way
Princeton, NJ 08540
with a copy to:
Thomas A. Belton, Esq.
Drinker, Biddle & Reath LLP
105 College Road East
P.O. Box 627
Princeton, NJ 08542-0627
If to the Purchaser, addressed to:
Mr. David Brodsky
2856 Hurlingham Way
Wellington, FL 33414
with a copy to:
Howard Sobel, Esq.
Kramer, Levin, Naftalis & Frankel
919 Third Avenue
New York, NY 10022-3903
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If to any other holder of record of any security, to it at its address set
forth in the applicable register maintained by the Company with respect
thereto.
ARTICLE IX
SURVIVAL OF COVENANTS, AGREEMENTS,
REPRESENTATIONS AND WARRANTIES
All covenants, agreements, representations and warranties made herein
or in any other document referred to herein or delivered to any party pursuant
hereto shall be deemed to have been relied on by each such party,
notwithstanding any investigation made by such party or on its behalf. All
representations and warranties made herein shall survive the execution and
delivery of this Agreement.
ARTICLE X
AMENDMENTS AND WAIVERS
Except as otherwise expressly provided herein, any term of this
Agreement may be amended and the observance of any term of this Agreement may be
waived (either generally or in a particular instance and either retroactively or
prospectively) only with the written consent of the Company and the Purchaser.
Any amendment or waiver effected in accordance with this Article IX shall be
binding upon the Company and each holder of any Purchased Securities sold
pursuant to this Agreement.
ARTICLE XI
RIGHT TO PUBLICIZE
Each of the parties hereto hereby agrees that it will not, except as
required by law, issue a press release or make any public statement regarding
the transactions contemplated hereby without the prior approval of the Company
and the Purchaser, provided, however, that following the Closing, the Purchaser
will have the right to publicize his investment in the Company as contemplated
hereby by means of a tombstone advertisement or other customary advertisement in
newspapers and other periodicals which advertisement shall be reasonably
acceptable to the Company. Further, the Company will make all necessary public
disclosures and filings with the Securities and Exchange Commission and will
have the right to inform actual or prospective customers and lenders of such
investment.
ARTICLE XII
ENTIRE AGREEMENT; COUNTERPARTS; SECTION HEADINGS, ETC.
This Agreement and the other writings referred to herein or delivered
pursuant hereto which form a part hereof contain the entire understanding of the
parties hereto with respect to its
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subject matter. This Agreement supersedes all prior agreements and
understandings between the parties with respect to its subject matter.
Any action or decision required or permitted to be made by the Company
under this Agreement shall be made by the Company's Board of Directors, unless
otherwise expressly stated herein.
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument. The descriptive headings of sections and paragraphs
of this Agreement are inserted for convenience only, and do not constitute a
part of this Agreement and shall not affect in any way the meaning or
interpretation of this Agreement.
The termination of this Agreement shall not cause a termination or
cancellation of Confidentiality Agreements heretofore provided by the Purchaser
and the Designees.
IN WITNESS WHEREOF, the Company and the Purchaser have executed this
Agreement as of the day and year first above written.
COMPANY:
TOTAL RESEARCH CORPORATION
By: /s/ Albert Angrisani
----------------------
Name: Albert Angrisani
Title: President and CEO
PURCHASER:
/s/ David Brodsky
-------------------
Name: DAVID BRODSKY
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SCHEDULE 1.1
DESIGNEES
EUGENE GOLDBERG
DONALD JACOBSON
ANTHONY M. LAMPORT
HOWARD L. SHECTER
GEORGE L. LINDEMANN
ALAN L. STUART
<PAGE>
SCHEDULE 2.11
LITIGATION
The Company has received notice of a Counterclaim in a suit filed by Company
against Agricultural Marketing Research Services, t/a AMRS and William Campbell,
pending in the Superior Court of New Jersey, Docket No. L-12206-97. A copy of
the Defendant's Answer & Counterclaim is attached.
<PAGE>
Exhibit D
49 Krebs Road
Plainsboro, NJ 08536
April 16, 1998
Mr. David Brodsky
c/o Edwards & Angell
2700 Hospital Trust Tower
Providence, RI 02903
Dear Mr. Brodsky:
Please consider this letter agreement to constitute the terms and conditions
under which I agree to sell and you, as the representative for an entity or
group to be formed ("Buyer"), agree to buy, 200,000 shares (the "Shares") of
common stock, par value $.001 per share, of Total Research Corporation, a
Delaware corporation ("TRC"), that I own. These terms and conditions are as
follows:
1.At Closing (as hereinafter defined), Buyer agrees to buy, and I agree to sell
the Shares of common stock, par value $.001 per share, of TRC (the "Common
Stock"), for a purchase price of $2.25 per share (the "Per Share Purchase
Price") amounting in the aggregate to a purchase price of Four Hundred Fifty
Thousand Dollars ($450,000)(the "Purchase Price").
I hereby represent and warrant as of the Closing the following:
(a)The Shares have not been registered under the Securities Act of 1933, as
amended (the "Securities Act"), or under any state securities law, and are
"restricted securities" within the meaning of such Act and may not be further
transferred except in accordance with such Act and applicable state securities
law.
(b)I own (beneficially and of record) the Shares individually and free and clear
of all liens and encumbrances and have full power and authority to sell, convey
and transfer the Shares. No one else has any rights in and to the Shares and
there exists no rights, options, warrants or conversion rights with respect to
the Shares.
The Buyer represents and warrants as of the Closing the following:
(a)The Buyer is acquiring the Shares solely for its own account
and with no intention of distributing or reselling said
<PAGE>
securities or any part thereof, of interest therein, in any transaction which
would be in violation of the securities laws of the United States of America or
any states therein, without prejudice, however, to your right at all times to
sell or otherwise dispose of all or any of the Shares pursuant to a registration
statement under the Securities Act or under an exemption from such registration
available under the Securities Act.
(b) Buyer is an "accredited investor" as such term is defined in Rule
501 of Regulation D of the Securities Act, and has sufficient knowledge and
experience in business and financial matters as to be capable of evaluating the
merits and risks of this investment and protecting your interest in connection
with such purchase.
The Purchase Price shall be paid at Closing by certified check drawn to my
order, or by wire transfer of immediately available funds consistent with the
wire instructions that I will furnish in writing to Buyer.
At Closing, I shall deliver to Buyer a stock certificate registered in my name
representing the Shares, together with a stock power duly endorsed. I agree to
execute such additional documents as may be necessary to convey the Shares and
vest full title to the Shares in Buyer's name or the name of your designees and
to consummate the transactions contemplated at the Closing.
The Closing for purposes of this letter agreement is to occur at the office of
Thomas P. Borkowski, Esq., One Pennington-Washington Crossing Road, Pennington,
New Jersey 08534 no later than the last day of the Due Diligence Period, or such
other time and place as Buyer and I shall mutually agree. The Closing to occur
on May 7, 1998.
This letter agreement is binding upon the parties hereto and their
respective heirs, executors, administrators, successors and assigns. This letter
agreement may be executed in two or more counterparts, each of which shall be
deemed an original but all of which shall together constitute one and the same
instrument. This letter agreement constitutes the entire agreement between us
and supersedes any prior understandings, agreement or representation by or
between us, written or oral (including, without limitation, the
"Brodsky/Zissman/Devine Term Sheet"). This agreement shall be governed by,
construed and in accordance with the laws of the State of Delaware without
giving effect to any choice or conflict of law provision or rule (whether of the
<PAGE>
State of Delaware or any other jurisdiction) that would cause the application of
the laws of any jurisdiction other than the State of Delaware.
Very truly yours,
/s/ Hugh Devine
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HUGH DEVINE WITNESS
Accepted and Agreed to this 16th day of April, 1998
/s/ David Brodsky /s/ Carolyn Brodsky
- ----------------- -------------------
DAVID BRODSKY WITNESS
