UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
UNITED ASSET MANAGEMENT CORPORATION
(Name of Issuer)
Common Stock, par value $.01 per share
(Title of Class of Securities)
909-420-101
(CUSIP Number)
Thad M. Brown
Provident Investment Counsel
300 North Lake Avenue
Pasadena, California 91101-4022
(818) 449-8500
(Name, Address, and Telephone Number of Person Authorized to
Receive Notices and Communications)
January 27, 1995
(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: [ ]
Check the following box if a fee is being paid with the
statement: [X]
<PAGE>
CUSIP No.
1) Name of Reporting Person Provident Investment
Counsel
S.S. or I.R.S. Identification No.
of Above Person 95-2989756
2) Check the Appropriate Box if a (a) [ ]
Member of a Group (b) [ ]
3) SEC Use Only
4) Source of Funds OO
5) Check if Disclosure of Legal Proceedings
is Required Pursuant to Items 2(d) or
2(e) [ ]
6) Citizenship or Place of Organization California
7) Sole Voting 0 shares
Power
Number of Shares 8) Shared Voting 0 shares
Power
9) Sole Dis- 0 shares
positive Power
10) Shared Dis- 0 shares
positive Power
11) Aggregate Amount Beneficially
Owned By Each Reporting Person 2,332,389 shares
12) Check box if the Aggregate Amount
in Row (11) Excludes Certain Shares [ ]
13) Percent of Class Represented by
Amount in Row (11) 0%
14) Type of Reporting Person CO
Item 1. Security and Issuer.
The class of equity securities to which this Statement
relates is the Common Stock, par value $.01 per share (the
"Common Stock"), of United Asset Management Corporation, a
Delaware corporation (the "Issuer"). The principal executive
offices of the Issuer are located at One International Place,
Boston, Massachusetts 02110.
Item 2. Identity and Background.
This Statement is being filed by Provident Investment
Counsel, a California corporation ("PIC"). The principal
business of PIC is to act as an investment manager. The address
of the principal business and the principal office of PIC is 300
North Lake Avenue, Pasadena, California 91101-4022. The name,
business address, present principal occupation or employment, and
citizenship of each executive officer and director of PIC is set
forth on Schedule A attached hereto.
During the last five years, neither PIC nor, to the
best knowledge of PIC, any of the persons listed on Schedule A
attached hereto, has been convicted in any criminal proceeding
(excluding traffic violations or similar misdemeanors) or been a
party to a civil proceeding of a judicial or administrative body
of competent jurisdiction and as a result of such proceeding
become 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.
Item 3. Source and Amount of Funds or Other Consideration.
Pursuant to the Acquisition Agreement described in Item
4 below, PIC has agreed to sell to the Issuer substantially all
the assets and business of PIC for $350,989,400, subject to
adjustment, part of which is payable in cash, part of which is
payable with a note of the Issuer and related warrants to
purchase Common Stock, and part of which is payable in Common
Stock.
Item 4. Purpose of Transaction.
On November 10, 1994, PIC entered into an acquisition
agreement of same date (as amended, the "Acquisition Agreement"),
with the Issuer, PIC's stockholders, and PIC Newco, Inc., a
Massachusetts corporation and an indirect wholly-owned subsidiary
of the Issuer ("Newco"). The closing (the "Closing") of the
transactions contemplated by the Acquisition Agreement was
initially scheduled to take place on January 27, 1995. This date
was subject to extension and was extended by agreement of the
parties to February 15, 1995.
Pursuant to the Acquisition Agreement and subject to
the terms and conditions thereof, the Issuer has agreed to
purchase substantially all of the assets and business of PIC (the
"Assets"). According to the terms of the Acquisition Agreement,
upon its consummation, the Issuer will immediately contribute the
Assets to Newco. Reference is made to the Acquisition Agreement,
a copy of which is attached hereto as an exhibit and which is
incorporated herein by reference.
Upon consummation of the Acquisition Agreement, the
Issuer is to pay a purchase price for the Assets of $350,989,400,
subject to adjustment, $262,804,550 of which is payable in cash,
$20,814,776 of which is payable in a note (the "Note") and a
warrant agreement and warrant certificate evidencing PIC's right
to purchase 459,385 shares of Common Stock at the price of $45.31
per share, subject to adjustment as stated therein (collectively,
the "Warrant"), and $67,370,074 of which is payable in Common
Stock. The aggregate exercise price under the Warrant is
equivalent to the principal amount of the Note and the Note may
be used to exercise the Warrant. Reference is made to the
Warrant Agreement, the form of which is attached hereto as an
exhibit and which is incorporated herein by reference.
Pursuant to the Acquisition Agreement, the number of
shares of Common Stock to be issued to PIC was to be based on the
20-trading day daily pre-closing average stock market value of
the Common Stock, subject to a floor of $29.00 per share of
Common Stock and a ceiling of $43.50 per share of Common Stock.
By letter agreement among the parties, the number of shares of
Common Stock to be issued to PIC is 1,873,004 and is based on the
daily average stock market value of the Common Stock for the 20
trading days preceding January 27, 1995, i.e., $35.969,
notwithstanding the extension of the Closing to February 15,
1995.
Upon closing of the transactions contemplated by the
Acquisition Agreement, PIC, for the purpose of Rule 13d-3
promulgated under the Securities Exchange Act of 1934, as
amended, may be deemed to beneficially own, subject to
adjustment, 2,332,389 shares of Common Stock, including the
459,385 shares which PIC would have the right to purchase under
the warrant. This number of shares would represent approximately
7.6% of such shares outstanding at such time.
In addition, the Acquisition Agreement also provides
that, depending on the fiscal performance of Newco in 1997
according to certain post-closing criteria, a contingent payment
may be paid by the Issuer to PIC in 1998. The contingent payment
is not to exceed $125,000,000 and, should such a contingent
payment be made, the Issuer is to deliver a portion of such
contingent payment in cash, a portion in a note and related
warrants to purchase Common Stock, and a portion in Common Stock.
The number of shares of Common Stock issued as part of
such contingent payment would be based upon the amount, if any,
of such contingent payment, as well as on a 20-trading day
average stock market value of the Common Stock prior to the
contingent closing date. Thus, the number of such shares of
Common Stock to be issued to PIC, if any, cannot be determined at
this time.
Further, according to the terms of the Acquisition
Agreement, the Issuer may, at its option, pay the portion of any
such contingent payment payable in shares of Common Stock in cash
if the average price per share of Common Stock is below either
(i) $29.00 or (ii) 80% of the average price per share of such
Common Stock for the last trading day of each of the weeks in a
one-year period prior to the contingent closing date.
The consummation of the Acquisition Agreement is
subject to the occurrence of a number of conditions, and there
can be no assurance that the transaction will be consummated.
If PIC elects to distribute the shares of Common Stock
it receives at the Closing (including the right to purchase
shares upon exercise of the Warrant) to its stockholders, such
stockholders would become beneficial owners of Common Stock.
Thus, each of the individual stockholders of PIC could be deemed
to beneficially own the number of shares of Common Stock set
forth next to his name below:
Maximum Number of Shares
Stockholder Deemed Beneficially Owned
ROBERT KOMMERSTAD 544,845
THOMAS CONDON 429,393
JEFFREY MILLER 429,393
GEORGE HANDTMANN 429,393
LARRY TASHJIAN 429,393
THOMAS MITCHELL 23,324
F. BROWN WINDLE 23,324
LAURO GUERRA 23,324
PIC may, in connection with the transactions
contemplated by the Acquisition Agreement, be dissolved by its
stockholders following the closing of the transactions
contemplated by the Acquisition Agreement. If PIC is dissolved,
the shares of Common Stock as well as the rights of PIC to
receipt of shares of Common Stock under the Acquisition Agreement
as part of the contingent payment will devolve to PIC's stockholders.
Except as set forth above, as of the date hereof, PIC
has no plans or proposals which relate to or would result in any
of the transactions described in subparagraphs (a) through (j) of
Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer.
(a) Except as set forth above, neither PIC nor, to the
best knowledge of PIC, any of the persons listed on Schedule A
hereto, beneficially owns any shares of Common Stock.
(b) Neither PIC nor, to the best knowledge of PIC, any
of the persons listed on Schedule A hereto, currently has sole or
shared power to vote or direct the vote or dispose of any shares
of Common Stock.
(c) Except as set forth above, there have been no
acquisitions of Common Stock by PIC nor, to the best knowledge of
PIC, any of the persons listed on Schedule A hereto, in the last
60 days.
(d) Inapplicable.
(e) Inapplicable.
Item 6. Contracts, Arrangements, Understandings, or
Relationships with Respect to Securities of the Issuer.
Except as described herein, PIC has no contracts,
arrangements, understandings, or relationships (legal or
otherwise) with respect to any securities of the Issuer,
including, but not limited to, any agreements concerning (i) the
transfer or voting of any securities of the Issuer, (ii) finder's
fees, (iii) joint ventures, (iv) loan or option arrangements, (v)
puts or calls, (vi) guarantees of profits, (vii) division of
profits or loss, or (viii) the giving or withholding of proxies.
Item 7. Material to be filed as Exhibits.
Exhibit 1: Acquisition Agreement, dated as of
November 10, 1994, by and among United
Asset Management Corporation, PIC Newco,
Inc., Provident Investment Counsel, and
the Stockholders of Provident Investment
Counsel.
Exhibit 2: Form of Warrant Agreement between United
Asset Management Corporation and
Provident Investment Counsel (Exhibit C
to the Acquisition Agreement).
SIGNATURE
After reasonable inquiry and to the best of my
knowledge and belief, I certify that the information set forth in
this statement is true, complete, and correct.
February 6, 1995
PROVIDENT INVESTMENT COUNSEL
/s/ Robert M. Kommerstad
Robert M. Kommerstad,
President
SCHEDULE A
EXECUTIVE OFFICERS AND DIRECTORS OF PROVIDENT INVESTMENT COUNSEL
The name, business address, title, present principal
occupation or employment of each of the executive officers and
directors of Provident Investment Counsel ("PIC") are set forth
below. Unless otherwise indicated, each officer's or director's
business address is 300 North Lake Avenue, Pasadena, California
91101-4022. Unless indicated otherwise, each occupation set
forth next to an individual's name refers to PIC. All of the
persons listed below are citizens of the United States.
ROBERT KOMMERSTAD; Chairman and President.
THOMAS CONDON; Managing Director.
JEFFREY MILLER; Managing Director.
GEORGE HANDTMANN; Managing Director.
LARRY TASHJIAN; Managing Director.
THOMAS MITCHELL; Executive Vice President, Portfolio Management
F. BROWN WINDLE; Executive Vice President, Marketing.
LAURO GUERRA; Executive Vice President, Research.
EXHIBIT INDEX
Exhibit Number Description
Exhibit 1 Acquisition Agreement, dated as of
November 10, 1994, by and among United
Asset Management Corporation, PIC Newco,
Inc., Provident Investment Counsel, and
the Stockholders of Provident Investment
Counsel.
Exhibit 2 Form of Warrant Agreement between United
Asset Management Corporation and
Provident Investment Counsel (Exhibit C
to the Acquisition Agreement).
Exhibit C to
Acquisition Agreement
UNITED ASSET MANAGEMENT CORPORATION
Common Stock
(Par Value $.01 Per Share)
WARRANT AGREEMENT
WARRANT AGREEMENT dated as of [_______________ __,
1995] between
United Asset Management Corporation, a Delaware corporation (the
"Company"), and
Provident Investment Counsel, ("PIC"), a California corporation
(such person, together with
transferees permitted herein, is referred to as the "Holder").
The Company is issuing a warrant to the Holder to
purchase 459,385 shares of
Common Stock, $.01 par value, of the Company (the "Shares").
Such warrant is issued as
part of the purchase price paid by the Company for the
acquisition of substantially all the
assets and business of PIC, which assets and business have been
transferred to the
Company's subsidiary, PIC Newco, Inc. ("Newco"), pursuant to an
Acquisition Agreement
dated as of November 10, 1994 by and among the Company, PIC,
Newco and the
Stockholders of PIC (the "Acquisition Agreement"). This Warrant
Agreement relates to the
Warrant issued to the Holder.
Terms defined and used in the Acquisition Agreement
shall have the same
meaning when used in this Warrant Agreement.
NOW, THEREFORE, in consideration of the premises and
the mutual
agreements herein set forth and for other good and valuable
consideration, the parties hereto
agree as follows:
Section 1. Issuance of the Warrant. The Company hereby
irrevocably grants
to the Holder the right to purchase all or any part of the Shares
on the terms and conditions
hereinafter set forth, such right to be evidenced by a warrant
certificate in the form attached
hereto (the "Warrant") for 459,385 Shares.
Section 2. Term of the Warrant. The Warrant shall be
exercisable in whole at
any time, or in part from time to time, on and after the date
hereof and prior to the earlier of
(a) the close of business on [__________ __, 2002]; or (b) if the
Company exercises its
option to give the notice described in Section 4(d), on the
occurrence of either of (i) the close
of business on the 30th day after the end of a thirty-day period
during which the closing
price for publicly-traded Common Stock of the Company is never
less than the Trigger Price
(as hereinafter defined); or (ii) the close of business on the
30th day after the end of a
ninety-day period during which the average closing price (defined
as the average of daily
closing prices for all business days during the ninety-day
period) of publicly-traded Common
Stock of the Company is not less than the Trigger Price (as
hereinafter defined); at which
time all rights evidenced by the Warrant shall cease and the
Warrant shall become void,
except as otherwise provided herein.
For purposes of this Section 2, for any price to be not
less than the "Trigger
Price" shall mean that the price is or would be, taking into
account and adjusting
appropriately for the effects of any of the transactions
contemplated by paragraphs (a) and (b)
of Section 5 hereof, not less than Fifty-Six Dollars and
Sixty-Four Cents ($56.64) per share
of Common Stock.
Section 3. Purchase Price. The purchase price per
share of the Shares subject
to the Warrant shall be Forty-Five Dollars and Thirty-One Cents
($45.31) subject to
adjustment from time to time as hereinafter provided (the
"Purchase Price").
Section 4. Form and Exercise of the Warrant.
(a) The Warrant shall be executed on behalf of the
Company by the manual
or facsimile signature of the President, the Executive Vice
President, or a Senior Vice
President of the Company, under its corporate seal, affixed or in
facsimile attested by the
manual or facsimile signature of the Secretary or Assistant
Secretary of the Company.
(b) The Warrant shall be dated the date of issuance.
(c) Subject to the provisions of this Warrant
Agreement, the Holder of the
Warrant shall have the right to purchase in whole or in part from
time to time from the
Company (and the Company shall issue and sell to the Holder) the
Shares, at the Purchase
Price as provided in Section 3 above, subject to adjustment as
provided herein, upon
surrender to the Company at its address as stated in the
Acquisition Agreement, of the
certificate evidencing the Warrant, with the form of election to
purchase attached thereto
duly filled in and signed, and upon payment of the Purchase Price
as provided herein.
The Purchase Price may be paid in whole or in part by
the Holder either by
delivery to the Company of the Company's Note or a portion
thereof, equal in principal
amount to the amount of the Purchase Price due; or by payment of
the Purchase Price in
cash; or by a combination of both. No adjustment shall be made
for any dividend on any
shares issuable upon exercise of the Warrant so surrendered.
Within thirty days after any exercise of the Warrant,
in whole or in part, by
delivery of all or a portion of the Company's Note, the Company
shall pay to the Holder in
cash any unpaid accrued interest on such Note, or portion thereof
so used, as of the date of
such exercise.
If the closing prices of the Company's publicly-traded
Common Stock satisfy
either of the conditions described in clauses (b)(i) and (b)(ii)
of Section 2 hereof, the
Company may, at its election and at any time subsequent to the
second anniversary of this
Warrant Agreement, and not before, so notify the Holder in
writing. If such notice is given
and if the Holder desires to exercise the Warrant, the Holder
shall within fifteen days of the
effective date of such notice surrender the Warrant with the
subscription form duly filled in
and signed, and shall deliver payment of the Purchase Price in
accordance with this Warrant
Agreement within thirty days of the effective date of such
notice.
(d) Upon surrender of the Warrant and payment of the
Purchase Price in
accordance with this Warrant Agreement, the Company shall issue
and cause to be delivered
in the name of the Holder, a certificate for the number of Shares
as to which the Warrant is
being exercised. Except as otherwise provided herein, such
certificate shall be deemed to
have been issued as of the date of the surrender of the Warrant
and payment of the Purchase
Price.
The Warrant shall be exercisable, at the election of
the Holder, either as an
entirety or from time to time for only part of the number of
Shares specified in the warrant
certificate. In the event that the Warrant is exercised for less
than all of the Shares at any
time prior to the date of expiration of the Warrant, a new
warrant certificate will be issued
for the remaining number of Shares evidenced by the warrant
certificate so surrendered. All
the Shares issued as provided herein will be fully paid and
nonassessable. The Company will
pay its fees, charges and expenses including fees, charges and
expenses (other than transfer
taxes) in connection with transfers of the Warrant and exercise
thereof and the issuance of
Shares upon such exercise.
Section 5. Adjustment of the Purchase Price and Shares
Purchasable.
(a) In case the Company shall (i) declare a dividend
in shares of its
Common Stock, (ii) subdivide its outstanding shares of Common
Stock into a greater number
of shares or (iii) combine its outstanding shares of Common Stock
into a smaller number of
shares, the Purchase Price in effect immediately prior thereto
and the number of shares
purchasable shall be proportionately adjusted so that thereafter
the Holder shall be entitled to
receive upon exercise of the Warrant in exchange for the same
aggregate consideration, the
number of shares of Common Stock which it would have owned or
been entitled to receive
with respect to any such event had the Warrant been exercised
immediately prior to the
earlier of the effectiveness of or record date for the adjustment
on account of such event.
Such adjustment shall be made whenever any of the events listed
above shall become
effective or, if earlier, the record date therefor.
(b) In case of any reclassification or change of
outstanding shares of
Common Stock, or in case of any consolidation of the Company with
or merger of the
Company with or merger of the Company into another corporation
(other than a merger
whose sole purpose is to change the state of incorporation of the
business of the Company or
a consolidation or merger in which the Company is the continuing
corporation and which
does not result in any reclassification or change of outstanding
shares of Common Stock), or
in case of any sale or conveyance to another corporation of the
property of the Company as
an entirety or substantially as an entirety in one or more steps,
the Holder shall have the
right thereafter without payment of additional consideration,
upon exercise of the Warrant, to
receive the kind and amount of shares of stock and other
securities and property receivable
upon such reclassification, change, consolidation, merger, sale
or conveyance by a holder of
the number of shares of Common Stock able to be purchased upon
such exercise of the
Warrant immediately prior to such reclassification, change,
consolidation, merger, sale or
conveyance. It shall be a condition of the effectiveness of any
such transaction that the
foregoing provision for the benefit of the Warrant shall be
lawfully and adequately provided
for.
Section 6. Reservation of Shares. The Company shall at
all times reserve and
keep available, out of its treasury stock or authorized and
unissued stock, or both, solely for
the purpose of effecting the exercise of the Warrant, such number
of shares of Common
Stock as shall from time to time be sufficient to effect the
exercise of the Warrant from time
to time outstanding.
Section 7. Restrictions on Transferability.
All transfers of the Warrant, other than a distribution
of the Warrant to the
Stockholders of PIC, or the shares issuable upon its exercise
shall be subject to the following
restrictions.
(a) The Holder shall not sell, transfer, assign,
pledge, hypothecate, or
otherwise dispose of the Warrant and the Shares to be issued on
exercise of the Warrant
(hereinafter defined as "Restricted Securities") unless one of
the following events shall also
have occurred:
(i) The Company shall have received an opinion from
Hill & Barlow,
Counsel to the Company or such other counsel as
the Holder shall
elect and shall be reasonably satisfactory to
the Company, stating
that the contemplated disposition of Restricted
Securities is exempt
from the registration and prospectus delivery
requirements of the
Securities Act and the rules and regulations of
the Commission
thereunder and applicable state securities laws
and the rules and
regulations of any state securities agencies
thereunder; or
(ii) The Company shall have been furnished with a
letter from the
Commission and an opinion from any applicable
state securities
agency in response to a written request
(previously submitted to the
Company, and in form and substance subject to
the reasonable
satisfaction of the Company) setting forth the
material facts and
circumstances surrounding the contemplated
disposition of Restricted
Securities, stating that the staff of Commission
and any applicable
state securities agency, respectively, will not
recommend any action
with regard to the contemplated disposition or
otherwise indicating
that the Commission and any applicable state
securities agency,
respectively, do not object to or disapprove of
the consummation of
the contemplated disposition; or
(iii) The Common Stock issuable upon exercise of the
Warrant shall have
been registered pursuant to Section 8 below.
The Company may if required by applicable securities
laws condition the
transfer of the Restricted Securities or any part thereof, upon
(i) the contemplated transferee
furnishing the Company with a letter to the effect that it is
acquiring the Restricted Securities
for its own account and not with a view to the distribution
thereof, and (ii) each certificate
evidencing the Restricted Securities having a legend endorsed
thereon as set forth in
subsection (c) below.
(b) Certain Definitions. As used in this Section 7 and
in Section 8, the
following terms shall have the following respective meanings:
"Commission" shall mean the Securities and
Exchange Commission or
any other Federal agency at the time administering the Securities
Act.
"Securities Act" shall mean the Securities Act of
1933 or any similar
Federal statute and the rules and regulations of the Commission
thereunder, all as the same
shall be in effect at the time.
"Transfer" shall include any disposition of the
Warrant or Common
Stock issued upon exercise of the Warrant or of any interest
therein which would constitute a
sale thereof within the meaning of the Securities Act.
"Person" shall mean and include an individual, a
corporation, a
partnership, a trust, an unincorporated organization and a
government or any department,
agency or political subdivision thereof.
"Restricted Securities" shall mean the Warrant and
the Shares which
are issuable upon exercise of the Warrant, and "Restricted Stock"
shall mean the Shares
issuable on exercise of the Warrant only.
(c) Restrictive Legend. The Restricted Securities
shall be stamped or
otherwise imprinted with a legend in substantially the following
form:
"The transfer of [the shares represented by this
certificate] [this
Warrant and the shares of Common Stock issuable upon exercise
hereof] is subject to the
conditions specified in Section 7 of the Warrant Agreement dated
[__________ __, 1995],
and no transfer of [this Warrant and such shares] [such shares]
shall be valid or effective
until such conditions have been fulfilled. As set forth in such
Section 7, among other things,
[this Warrant and such shares] [such shares] have not been
registered under the Securities
Act of 1933 or qualified under any state securities laws. [The
shares represented by this
Certificate] [This Warrant and the shares of Common Stock
issuable upon exercise hereof]
may not be sold or transferred in the absence of an effective
registration statement for the
shares under such Act and qualification under such laws or an
opinion satisfactory to the
Company that such registration and qualification are not, in the
circumstances, required.
The Company may issue stop-transfer instructions to its
transfer agent in
accordance with the terms of the foregoing legend.
(d) Notice of Transfers. The holder of each
certificate representing
Restricted Securities by acceptance thereof agrees, in addition
to the requirements of
subsection (a) above, to give written notice to the Company of
any proposed transfer thereof,
together with a certificate from such holder and the person to
whom any such certificate is
proposed to be transferred to the effect that all the conditions
set forth in this Section 7 have
been met. Each certificate evidencing the Restricted Securities
transferred (and each
certificate evidencing any untransferred balance of such
Restricted Securities) shall bear the
foregoing restrictive legend.
Section 8. Registration Rights
(a) Company Public Offering. At any time within two
years of the date of
this Warrant Agreement that the Company proposes to register any
shares of its Common
Stock under the Securities Act for sale by the Company within
such two-year period (other
than registration of the Company's Common Stock for issuance in
connection with employee
compensation or benefit programs or for acquisitions and
specifically excluding registration
pursuant to a demand of any stockholder of the Company exercising
registration rights), the
Company will give prompt written notice to the Holder of its
intention so to do and, upon
the written request of the Holder sent within 10 days after the
effective date of any such
notice, the Company will use its best efforts to cause all
Restricted Stock the Holders of
which shall have so requested registration thereof for sale in
the Company's offering, to be
registered under the Securities Act, all to the extent requisite
to permit the sale in such
offering by the prospective seller or sellers of the Restricted
Stock so registered in the same
manner as the Company proposes to offer its shares of Common
Stock.
The Company may, at its expense, request an opinion of
the underwriter
managing the syndicate for any proposed underwritten public
offering of its Common Stock
pursuant to any proposed registration, as to whether the
inclusion of the Restricted Stock of
Holders requesting registration would, in such underwriter's
opinion, adversely affect the
Company's offering. In the event of an adverse opinion, the
Restricted Stock proposed to be
registered may be reduced pro rata or eliminated in accordance
with such opinion, but only if
all other of the Company's shareholders who proposed to register
securities in the offering
(except those shareholders who have registration rights not
subject to such reduction or
elimination) are also proportionately reduced or eliminated.
(b) Registration Procedures and Expenses. If and
whenever the Company is
required by the provisions of this Section 8 to use its best
efforts to effect the registration of
any of the Restricted Stock under the Securities Act for sale in
the Company's offering, the
Company will, as expeditiously as possible, perform the
following:
(i) Prepare and file with the Commission a
registration statement with
respect to such securities and use its best
efforts to cause such
registration statement to become and remain
effective.
(ii) Prepare and file with the Commission such
amendments and
supplements to such registration statement and
the prospectus used in
connection therewith as may be necessary to
update and keep such
registration statement effective and to comply
with the provisions of
the Securities Act with respect to the sale or
other disposition of all
securities covered by such registration
statement. The Company's
obligation under this subparagraph shall
continue until the offering
of such securities is completed or for a period
of three months after
the effective date of such registration
statement, whichever is
shorter.
(iii) Furnish to each selling Holder such numbers of
copies of the
prospectus (including a preliminary prospectus)
in conformity with
the requirements of the Securities Act, and such
other documents as
the seller may reasonably request in order to
facilitate the public sale
or other disposition of the Restricted Stock
owned by such seller.
(iv) Use its best efforts to register or qualify (if
necessary) the Restricted
Stock covered by such registration statement
under such other
securities or blue sky laws of such
jurisdictions as such seller shall
reasonably request.
(v) The Company and the Holder recognize that it may
be advantageous
to the Holder to be able to sell the Warrant (or
a portion thereof, at
the Holder's option) rather than to exercise the
Warrant and sell the
shares received upon such exercise in a
registered public offering.
Accordingly, the Company may, in the event that
any request by the
Holder for registration pursuant to this Section
8 so specifies, and if
such procedure is acceptable to and agreed to by
the underwriter(s),
arrange for the underwriter(s) of the registered
public offering to
which the request relates to purchase the
Warrant (or a designated
portion thereof) from the Holder at a price
equal to the price that
would then be paid by such underwriter(s) for
the Shares to be
issued upon exercise of the Warrant if such
Warrant were first
exercised by the Holder, less the applicable
exercise price, and,
subject to the provisions of this Section 8,
will include in the
registration of such public offering the Shares
issuable upon exercise
of such Warrant by such underwriter(s).
All expenses incurred by the Company in complying with this
subsection (b), including,
without limitation, all registration and filing fees, printing
expenses, and fees and
disbursements of counsel for the Company, are herein called
Registration Expenses. All
underwriting discounts and selling commissions applicable to the
sales of Restricted Stock
and all fees and disbursements of counsel for any seller are
herein called Selling Expenses.
(c) Allocation of Expenses. The Company will pay all
Registration
Expenses in connection with each registration pursuant to this
Section 8. All Selling
Expenses in connection with each such registration shall be borne
pro rata by the seller or
sellers of such securities, provided, however, that if any seller
retains counsel who is not
representing all security holders selling in the offering, such
seller shall pay all fees and
disbursements of such counsel, which shall be excluded from the
Selling Expenses.
(d) Indemnification. In the event of any
registration of any of the
Restricted Stock under the Securities Act pursuant to this
Section 8, the Company will
indemnify and hold harmless the seller of such Restricted Stock,
each underwriter of such
Restricted Stock and each other person, if any, who controls such
seller or underwriter
within the meaning of Section 15 of the Securities Act, against
any losses, claims, damages,
liabilities or expenses, joint or several, to which such seller,
underwriter or controlling
person may become subject under the Securities Act or otherwise,
insofar as such losses,
claims, damages, liabilities or expenses (or actions in respect
thereof) arise out of or are
based upon (i) any untrue statement of a material fact contained
in any registration statement
under which such Restricted Stock was registered under the
Securities Act pursuant to this
Section 8, or any post-effective amendment thereof, or the
omission (or alleged omission) to
state therein a material fact required to be stated therein or
necessary to make the statements
therein not misleading or (ii) any untrue statement of a material
fact contained in any
preliminary prospectus, if used prior to the effective date of
the registration statement and
not corrected in the final prospectus, or contained in the final
prospectus (as amended or
supplemented, if the Company shall have filed with the Commission
any amendment thereof
or supplement thereto), or the omission (or alleged omission) to
state therein a material fact
required to be stated therein or necessary in order to make the
statements therein not
misleading; and will reimburse such seller, underwriter and each
such controlling person for
any legal or other expenses reasonably incurred by such seller,
underwriter or such
controlling person in connection with investigating or defending
any such loss, claim,
damage, liability or expense, provided, however, that the Company
will not be liable in any
such case to the extent that any such loss, claim, damage,
liability or expense arises out of or
is based upon any untrue statement or omission (or alleged
omission) of a material fact made
in said registration statement, said preliminary prospectus or
said prospectus or said
amendment or supplement in reliance upon and in conformity with
written information
furnished to the Company through an instrument duly executed by
such seller or underwriter
specifically for use in the preparation thereof.
In the event of any registration of any of the
Restricted Stock under the
Securities Act pursuant to this Section 8, each seller of such
Restricted Stock severally and
not jointly, will indemnify and hold harmless the Company, each
person, if any, who
controls the Company within the meaning of Section 15 of the
Securities Act, each officer of
the Company who signs the registration statement, each director
of the Company, each
underwriter and each person who controls any underwriter within
the meaning of Section 15
of the Securities Act, against any losses, claims, damages,
liabilities or expenses, joint or
several, to which the Company or such officer, director,
underwriter, or controlling person
may become subject under the Securities Act or otherwise, and
will reimburse the Company
or such officer, director, underwriter or controlling person for
any legal or other expenses
reasonably incurred by the Company or such officer, director,
underwriter or controlling
person in connection with investigating or defending any such
loss, claim, damage, liability
or expense, but only insofar as such losses, claims, damages,
liabilities or expenses (or
actions in respect thereof) arise out of or are based upon any
untrue statement or omission
(or alleged omission) of a material fact referred to in clause
(i) or (ii) of the preceding
paragraph of this subsection (d), and provided, however, that
this paragraph shall apply if
and only if such statement or omission (or alleged omission) was
made in reliance upon and
in conformity with information furnished in writing to the
Company by or on behalf of such
seller specifically for use in such registration statement or
prospectus.
The Company further agrees that in connection with any
underwritten public
offering, it also will enter into customary contribution
arrangements with the underwriters
and selling shareholders with respect to situations in which
indemnification is potentially
unavailable.
It shall be a condition of the Company's obligations to
effect registration of the
Restricted Stock that the sellers participating in such
registration provide the Company and
the underwriters, if any, with all material facts, including,
without limitation, furnishing such
certificates, questionnaires and legal opinions as may be
reasonably required by the Company
or such underwriters, concerning such participating sellers and
the Restricted Stock to be
registered which are reasonably required to be stated in the
registration statement or in the
prospectus or are otherwise reasonably required in connection
with the offering.
Section 9. Representations and Covenants of the
Holder. The Holder
represents and covenants that the Holder is acquiring the Warrant
and will acquire the Shares
for the Holder's own account, for investment, and not with a view
to or in connection with
any distribution or resale, except as set forth herein and in
Section 1.5 of the Acquisition
Agreement.
Section 10. Fractional Shares. No fractional share of
stock shall be issued in
connection with any exercise of the Warrant. If upon exercise of
the Warrant in its entirety a
fractional share would be required to be issued in the absence of
the preceding sentence, in
lieu of such share, the Company shall make a cash payment
therefor equal in amount to (i)
the product of the applicable fraction multiplied by the closing
price of the Company's
publicly-traded Common Stock on the date of exercise of the
Warrant, less (ii) the product of
the applicable fraction multiplied by the Purchase Price then in
effect. Any balance warrant
certificate issued after the Warrant is exercised in part may
include a fractional share.
Section 11. Miscellaneous. If the Warrant is lost,
stolen, mutilated or
destroyed, the Company shall, on such reasonable terms as to
indemnity or otherwise as it
may in its discretion impose (which shall, in the case of a
mutilated Warrant, include the
surrender thereof), issue a new Warrant of like denomination,
tenor and date as the Warrant
so lost, stolen, mutilated or destroyed. Any such new Warrant
shall constitute an original
contractual obligation of the Company, whether or not the
allegedly lost, stolen, mutilated or
destroyed Warrant shall be at any time enforceable by anyone.
This Warrant Agreement and the Warrant issued pursuant
thereto shall be
binding upon any and all successors or assigns of the Company.
All notices provided for herein or given in connection
herewith shall be given
in accordance with the notice provisions of the Acquisition
Agreement.
This Warrant Agreement is made under, and shall be
governed by, the laws of
the Commonwealth of Massachusetts which apply to contracts
executed and performed solely
in Massachusetts. The parties hereto hereby consent to the
jurisdiction of any state or federal
court located within Suffolk County, Massachusetts, waive
personal service of process and
assent that service of process may be made by registered mail to
the parties' respective
addresses as provided in Section 12.6 of the Acquisition
Agreement, and shall be effective in
the same manner as notices are effective under such Section 12.6.
IN WITNESS WHEREOF, the parties have caused this
Agreement to be duly
executed on the date first above written.
UNITED ASSET MANAGEMENT
CORPORATION
By:___________________________
Norton H. Reamer, President
HOLDER:
PROVIDENT INVESTMENT
COUNSEL
By:___________________________
Title:
________________________________________________________
________________________________________________________
Acquisition Agreement
by and among
United Asset Management Corporation,
Provident Investment Counsel
PIC Newco, Inc.
and the Stockholders of
Provident Investment Counsel
Dated as of
November 10, 1994
________________________________________________________
________________________________________________________
<PAGE>
Acquisition Agreement
by and among
United Asset Management Corporation,
Provident Investment Counsel
PIC Newco, Inc.
and the Stockholders of
Provident Investment Counsel
Dated as of
November 10, 1994
TABLE OF CONTENTS
Page
ARTICLE I. PURCHASE AND SALE.. . . . . . . . . . . . . . . . . .
. . . . . . 2
1.1 Sale of Assets . . . . . . . . . . . . . . . . . . . .
. . . . . . 2
1.2 Purchase Price . . . . . . . . . . . . . . . . . . . .
. . . . . . 2
1.3 Adjustment in Purchase Price . . . . . . . . . . . . .
. . . . . . 3
1.4 Contingent Payment . . . . . . . . . . . . . . . . . .
. . . . . . 7
1.5 Obligations Assumed by Newco . . . . . . . . . . . . .
. . . . . . 9
ARTICLE II. THE CLOSING. . . . . . . . . . . . . . . . . . . . .
. . . . . . 9
ARTICLE III. REPRESENTATIONS AND WARRANTIES OF PIC AND THE
STOCKHOLDERS. . . 9
3.1 PIC's Organization and Corporate Authority . . . . . .
. . . . . . 9
3.2 Charter, By-Laws and Minutes . . . . . . . . . . . . .
. . . . . .10
3.3 No Violation . . . . . . . . . . . . . . . . . . . . .
. . . . . .10
3.4 The Stockholders . . . . . . . . . . . . . . . . . . .
. . . . . .10
3.5 Financial Statements . . . . . . . . . . . . . . . . .
. . . . . .10
3.6 No Adverse Change. . . . . . . . . . . . . . . . . . .
. . . . . .12
3.7 Subsidiaries . . . . . . . . . . . . . . . . . . . . .
. . . . . .12
3.8 Taxes. . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . .12
3.9 Interests of Officers. . . . . . . . . . . . . . . . .
. . . . . .13
3.10 Property. . . . . . . . . . . . . . . . . . . . . . .
. . . . . 313
3.11 Accounts Receivable . . . . . . . . . . . . . . . . .
. . . . . .14
3.12 Insurance . . . . . . . . . . . . . . . . . . . . . .
. . . . . .14
3.13 Names, Franchises, Permits, Etc . . . . . . . . . . .
. . . . . .14
3.14 Investment Advisory Contracts . . . . . . . . . . . .
. . . . . .15
3.15 Other Contracts . . . . . . . . . . . . . . . . . . .
. . . . . .15
3.16 Certain Salaried Employees. . . . . . . . . . . . . .
. . . . . .16
3.17 Bank Accounts and Money Market Funds. . . . . . . . .
. . . . . .16
3.18 Litigation. . . . . . . . . . . . . . . . . . . . . .
. . . . . .16
3.19 Finder's Fee. . . . . . . . . . . . . . . . . . . . .
. . . . . .16
3.20 Employee Benefit Plans. . . . . . . . . . . . . . . .
. . . . . .16
3.21 Disclosure. . . . . . . . . . . . . . . . . . . . . .
. . . . . .19
3.22 Approvals . . . . . . . . . . . . . . . . . . . . . .
. . . . . .19
3.23 PIC's Authority . . . . . . . . . . . . . . . . . . .
. . . . . .19
3.24 Stockholders' Authority . . . . . . . . . . . . . . .
. . . . . .19
3.25 Government Regulation . . . . . . . . . . . . . . . .
. . . . . .19
3.26 Code of Ethics. . . . . . . . . . . . . . . . . . . .
. . . . . .21
3.27 No Practices in Violation of Law. . . . . . . . . . .
. . . . . .21
3.28 Employees' Health . . . . . . . . . . . . . . . . . .
. . . . . .21
3.29 Fee Schedule. . . . . . . . . . . . . . . . . . . . .
. . . . . .21
3.30 Investment Representations. . . . . . . . . . . . . .
. . . . . .21
ARTICLE IV. REPRESENTATIONS OF UAM AND NEWCO.. . . . . . . . . .
. . . . . .22
4.1 Organization of UAM and Newco and Corporate Authority.
. . . . . .22
4.2 No Violation . . . . . . . . . . . . . . . . . . . . .
. . . . . .23
4.3 Finder's Fee . . . . . . . . . . . . . . . . . . . . .
. . . . . .23
4.4 Charter, By-laws and Resolutions . . . . . . . . . . .
. . . . . .23
4.5 Financial Statements of UAM. . . . . . . . . . . . . .
. . . . . .23
4.6 Litigation . . . . . . . . . . . . . . . . . . . . . .
. . . . . .24
4.7 Disclosure . . . . . . . . . . . . . . . . . . . . . .
. . . . . .24
4.8 UAM's and Newco's Authority. . . . . . . . . . . . . .
. . . . . .24
4.9 Approvals. . . . . . . . . . . . . . . . . . . . . . .
. . . . . .24
4.10 Capitalization of UAM and Newco . . . . . . . . . . .
. . . . . .24
4.11 Authorization of Note and Warrant . . . . . . . . . .
. . . . . .25
4.12 Reservations of Common Stock. . . . . . . . . . . . .
. . . . . .25
4.13 Authorization of Common Stock . . . . . . . . . . . .
. . . . . .25
4.14 No Adverse Change . . . . . . . . . . . . . . . . . .
. . . . . .25
4.15 SEC Reports . . . . . . . . . . . . . . . . . . . . .
. . . . . .25
ARTICLE V. INDEMNIFICATION.. . . . . . . . . . . . . . . . . . .
. . . . . .25
5.1 Indemnification by the Stockholders and PIC. . . . . .
. . . . . .26
5.2 Indemnification by UAM . . . . . . . . . . . . . . . .
. . . . . .26
5.3 Survival of Representations and Warranties . . . . . .
. . . . . .26
5.4 Limitation on Liabilities of PIC Stockholders. . . . .
. . . . . .27
5.5 Third-Party Claims . . . . . . . . . . . . . . . . . .
. . . . . .27
5.6 Set-Off. . . . . . . . . . . . . . . . . . . . . . . .
. . . . . .28
5.7 Exclusivity. . . . . . . . . . . . . . . . . . . . . .
. . . . . .28
ARTICLE VI. TAX MATTERS. . . . . . . . . . . . . . . . . . . . .
. . . . . .28
6.1 Tax Returns. . . . . . . . . . . . . . . . . . . . . .
. . . . . .28
6.2 Taxes on Sale. . . . . . . . . . . . . . . . . . . . .
. . . . . .29
6.3 Allocation of Purchase Price Among Assets. . . . . . .
. . . . . .29
ARTICLE VII. PRE-CLOSING COVENANTS.. . . . . . . . . . . . . . .
. . . . . .29
7.1 Procedure for Obtaining Clients' Consents. . . . . . .
. . . . . .29
7.2 Non-Disclosure . . . . . . . . . . . . . . . . . . . .
. . . . . .30
7.3 Filings. . . . . . . . . . . . . . . . . . . . . . . .
. . . . . .30
7.4 Closing Conditions . . . . . . . . . . . . . . . . . .
. . . . . .30
7.5 Return of Confidential Information . . . . . . . . . .
. . . . . .31
7.6 Agreement Relating to Mutual Funds . . . . . . . . . .
. . . . . .31
7.7 Registration of UAM Stock. . . . . . . . . . . . . . .
. . . . . .31
(a) Registration Procedures and Expenses . . . . . . . . .
. . . . . .31
(b) Allocation of Expenses . . . . . . . . . . . . . . . .
. . . . . .33
(c) Indemnification. . . . . . . . . . . . . . . . . . . .
. . . . . .33
ARTICLE VIII. CONDUCT OF PIC'S BUSINESS PRIOR TO THE CLOSING
DATE. . . . . .34
ARTICLE IX. CONDITIONS PRECEDENT TO UAM'S AND NEWCO'S
OBLIGATIONS. . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . .36
9.1 Delivery of Documents of Transfer. . . . . . . . . . .
. . . . . .36
9.2 Employment Agreements. . . . . . . . . . . . . . . . .
. . . . . .36
9.3 Representations and Warranties True at the Closing
Date. . . . . .36
9.4 PIC's and Stockholders' Certificate. . . . . . . . . .
. . . . . .36
9.5 Clients' Consents. . . . . . . . . . . . . . . . . . .
. . . . . .37
9.6 Approvals. . . . . . . . . . . . . . . . . . . . . . .
. . . . . .37
9.7 Opinion of Counsel for PIC and the Stockholders. . . .
. . . . . .37
9.8 PIC's and the Stockholders' Performance. . . . . . . .
. . . . . .40
9.9 Payments Made. . . . . . . . . . . . . . . . . . . . .
. . . . . .40
9.10 Conduct of PIC's Business Prior to the Closing Date .
. . . . . .40
9.11 Certificate Relating to Real Property Interests . . .
. . . . . .40
9.12 Approval of Documentation . . . . . . . . . . . . . .
. . . . . .40
9.13 Examination of Books And Records. . . . . . . . . . .
. . . . . .40
9.14 Adviser's Act Registration. . . . . . . . . . . . . .
. . . . . .41
9.15 Working Capital . . . . . . . . . . . . . . . . . . .
. . . . . .41
9.16 Health. . . . . . . . . . . . . . . . . . . . . . . .
. . . . . .41
9.17 Life Insurance. . . . . . . . . . . . . . . . . . . .
. . . . . .41
9.18 Form 8-K. . . . . . . . . . . . . . . . . . . . . . .
. . . . . .41
9.19 Hart-Scott-Rodino Filing. . . . . . . . . . . . . . .
. . . . . .41
9.20 Exchange Listing. . . . . . . . . . . . . . . . . . .
. . . . . .42
ARTICLE X. CONDITIONS PRECEDENT TO PIC'S AND THE STOCKHOLDERS'
OBLIGATIONS. . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . .42
10.1 Opinion of UAM's and Newco's Counsel. . . . . . . . .
. . . . . .42
10.2 Representations and Warranties True at the Closing
Date . . . . .43
10.3 Performance of UAM and Newco. . . . . . . . . . . . .
. . . . . .43
10.4 Authority of UAM and Newco. . . . . . . . . . . . . .
. . . . . .43
10.5 Approval of Documentation . . . . . . . . . . . . . .
. . . . . .44
10.6 Revenue Sharing Agreement . . . . . . . . . . . . . .
. . . . . .44
10.7 Adjustment Percentage . . . . . . . . . . . . . . . .
. . . . . .44
10.8 Employment Agreements . . . . . . . . . . . . . . . .
. . . . . .44
10.9 Advisers' Act Registration. . . . . . . . . . . . . .
. . . . . .44
10.10 Assumption Agreement . . . . . . . . . . . . . . . .
. . . . . .44
10.11 NYSE Listing . . . . . . . . . . . . . . . . . . . .
. . . . . .44
10.12 Incentive Stock Options. . . . . . . . . . . . . . .
. . . . . .44
ARTICLE XI. POST-CLOSING COVENANTS.. . . . . . . . . . . . . . .
. . . . . .44
11.1 Non-Competition . . . . . . . . . . . . . . . . . . .
. . . . . .44
11.2 Confidentiality . . . . . . . . . . . . . . . . . . .
. . . . . .46
11.3 Further Assurances. . . . . . . . . . . . . . . . . .
. . . . . .47
11.4 Amendment to Registrations and Filing of Form 8-K . .
. . . . . .47
11.5 Compliance with Hart-Scott-Rodino Act . . . . . . . .
. . . . . .47
11.6 Additional Covenants. . . . . . . . . . . . . . . . .
. . . . . .47
11.7 Use of Name "Provident Investment Counsel, Inc. . . .
. . . . . .47
11.8 Options . . . . . . . . . . . . . . . . . . . . . . .
. . . . . .48
11.9 Statutory Compliance . . . . . . . . . . . . . . . .
. . . . . .48
11.10 Extension Bonus Payment. . . . . . . . . . . . . . .
. . . . . .48
11.11 UAM Capital Contribution . . . . . . . . . . . . . .
. . . . . .48
11.12 Employees; Employee Benefits.. . . . . . . . . . . .
. . . . . .48
ARTICLE XII. GENERAL. . . . . . . . . . . . . . . . . . . . . .
. . . . . .50
12.1 Entire Agreement. . . . . . . . . . . . . . . . . . .
. . . . . .50
12.2 Equitable Relief; Binding Effect. . . . . . . . . . .
. . . . . .50
12.3 Separate Counterparts . . . . . . . . . . . . . . . .
. . . . . .50
12.4 Consistent Accounting . . . . . . . . . . . . . . . .
. . . . . .51
12.5 Transaction Costs . . . . . . . . . . . . . . . . . .
. . . . . .51
12.6 Notices . . . . . . . . . . . . . . . . . . . . . . .
. . . . . .51
12.7 Severability. . . . . . . . . . . . . . . . . . . . .
. . . . . .52
12.8 Captions. . . . . . . . . . . . . . . . . . . . . . .
. . . . . .52
12.9 Due Inquiry . . . . . . . . . . . . . . . . . . . . .
. . . . . .52
12.10 Gender . . . . . . . . . . . . . . . . . . . . . . .
. . . . . .52
12.11 Governing Law. . . . . . . . . . . . . . . . . . . .
. . . . . .52
12.12 No Third-Party Beneficiaries . . . . . . . . . . . .
. . . . . .52
<PAGE>
Exhibits
A Form of UAM Non-Negotiable Subordinated
Note (Sec. 1.2)
B Form of Subordination Agreement (Sec. 1.2)
C Form of Warrant Agreement (Sec. 1.2)
D Form of Warrant Certificate (Sec. 1.2)
E-1 Form of Employment Agreement (Kommerstad) (Sec. 9.2)
E-2 Form of Employment Agreement (Miller, Handtmann, Tashijan)
(Sec. 9.2)
E-3 Form of Employment Agreement (Condon) (Sec. 9.2)
E-4 Form of Employment Agreement (1 per cent Stockholders)
(Sec. 9.2)
E-5 Employment Agreements effective upon Closing
(Non-Stockholders) (Sec. 9.2)
F Form of Revenue Sharing Agreement (Sec. 10.6)
G PIC Audited Financials (Sec. 3.5)
H PIC Unaudited Financials (Sec. 3.5)
I UAM Audited Financials (Sec. 4.5)
J UAM Unaudited Financials (Sec. 4.5)
K Form of Client's Consent (Art. VII)
L Stockholders' Closing Certificate as to
Representations, etc. (Sec. 9.3)
M Stockholders' Certificate as to By-Laws, etc. (Sec. 9.4)
N Stockholders' Certificate as to Clients' Consents (Sec.
9.5)
O Stockholders' Certificate Relating to Payments
Made (Sec. 9.9)
P Stockholders' Certificate Relating to Real Property
Interests (Sec. 9.11)
Q UAM Certificate as to Representations, etc. (Sec. 10.2)
<PAGE>
Schedules
1 Stockholders of PIC
1.3A PIC's Client List
1.3B Example of Calculation of Adjustment
1.4 Example of Calculation of Contingent Payment
3.5 Liabilities
3.9 Interests of Officers
3.10A Property and Leases
3.10B Securities
3.11 Accounts Receivable
3.12 Insurance Policies
3.13 Names, Franchises, Permits, Etc.
3.15 Other Contracts
3.16 Employees
3.17 Bank Accounts and Money Market Funds
3.20 Employee Benefit Plans
3.25 Mutual Funds
3.26 Code of Ethics
3.28 Physician's Letters
8. Conduct of PIC's Business Prior to the Closing Date
9.17 Persons to be Insured by UAM
<PAGE>
ACQUISITION AGREEMENT
AGREEMENT made as of the 10th day of November, 1994, by and
among United
Asset Management Corporation, a Delaware corporation having its
principal place of
business at One International Place, Boston, Massachusetts 02110
("UAM"), PIC Newco,
Inc., a Massachusetts corporation and an indirect wholly-owned
subsidiary of UAM
("Newco"), Provident Investment Counsel, a California corporation
having its principal
place of business at Corporate Center, 300 North Lake Avenue,
Pasedena, California
91101 ("PIC"), and the persons listed on Schedule 1 hereto
(collectively, "Stockholders,"
and each individually, "Stockholder") who are the holders in the
aggregate of all of the
issued and outstanding capital stock of PIC (the "PIC Stock").
W I T N E S S E T H:
WHEREAS, based upon the representations, covenants,
agreements and warranties
herein made by PIC and the Stockholders and subject to the terms
and conditions
contained in this Agreement, UAM wishes to acquire the assets and
business of PIC and
immediately to contribute such assets and business to Newco,
which will continue to
conduct the business of PIC; and
WHEREAS, based upon the representations, agreements and
warranties herein
made by UAM and Newco and subject to the terms and conditions
contained in this
Agreement, PIC and the Stockholders wish to transfer and sell the
assets and business of
PIC to UAM and to have Newco continue the business of PIC; and
WHEREAS, the Stockholders, as owners of PIC, will benefit
from the sale of
assets hereunder and will become key employees of Newco after
such sale;
NOW, THEREFORE, in consideration of the mutual promises
herein contained,
the parties hereto, intending to be legally bound, do hereby
agree as follows:
<PAGE>
Article I. Purchase and Sale.
1.1 Sale of Assets. Subject to the terms and conditions
set forth herein, as of
the Closing Date (as defined in Article II) UAM shall purchase
from PIC and PIC shall
convey, transfer, set over, assign and deliver to UAM, free and
clear of all liens,
attachments, charges, lis pendens, and encumbrances of any nature
(except as may
otherwise expressly be permitted by this Agreement), all of the
assets of PIC, except such
assets to be retained or distributed by PIC as set forth on
Schedule 8 hereto ("Excluded
Assets"), consisting of the assets and business of PIC of every
kind and description,
tangible and intangible, real, personal or mixed and wherever
located and all proprietary
and associated rights relating thereto, including without
limitation all assets shown or
reflected in PIC's balance sheet as of September 30, 1994, the
Investment Advisory
Contracts (as hereinafter defined), customer lists, prospects
lists, books, records, and all
of PIC's goodwill and the exclusive right to use the name of PIC
as all or part of a trade
or corporate name (the "Assets"). UAM shall then transfer all of
the Assets to Newco.
1.2 Purchase Price. Subject to adjustment as provided in
Section 1.3, below,
UAM shall pay PIC in consideration of the purchase and sale of
the Assets (the
"Purchase Price"):
(a) Two hundred sixty-twomillion, eight hundred
fourthousand five
hundred fifty dollars ($262,804,550) in cash to be paid at the
Closing by wire transfer in
same day funds; and
(b) Twenty million, eight hundred fourteen
thousand, seven hundred
seventy-six dollars ($20,814,776) principal amount of UAM
Non-Negotiable Seven-Year
6 1/2 per cent Subordinated Note (the "Note"), to be delivered at
the Closing in the form
of Exhibit A hereto and subordinated in accordance with the form
of Subordination
Agreement attached hereto as Exhibit B (the "Subordination
Agreement"); and
(c) A Warrant Agreement in the form of Exhibit C
attached hereto (the
"Warrant Agreement"), and a Warrant Certificate in the form of
Exhibit D attached
hereto to be delivered at the Closing evidencing the right to
purchase 459,385 shares
($20,814,776 principal amount of the Note divided by the Warrant
exercise price of
$45.31 per share of UAM's Common Stock, $.01 par value (the
"Warrant"), and
exercisable in accordance with the Warrant Agreement at
forty-five dollars and thirty-one
cents ($45.31) per share, subject to adjustment as stated in the
Warrant Agreement; and
(d) an aggregate of sixty seven million, three
hundred seventy
thousand, and seventy-four dollars ($67,370,074) of UAM Common
Stock, $.01 par
value, valued in accordance with provisions set forth below (the
UAM Stock); and
(e) the Contingent Payment provided for in Section
1.4 below (in an
aggregate amount which shall not exceed $125,000,000 reduced by
the amount of any
Extension Bonus Payment payable by UAM pursuant to Section 11.10
below).
The per share price of UAM Stock to be used in calculating
the number of shares
of UAM Stock to be delivered pursuant to section (d) above (the
UAM "Stock Price")
shall be the average of the closing price of UAM's Common Stock
for the twenty (20)
successive trading days ending on the tenth trading day preceding
the Closing Date as
reported by the New York Stock Exchange, subject to the
following. If the average price
calculated pursuant to the preceding sentence is equal to or
greater than $43.50 per share,
the UAM Stock Price shall be $43.50 per share. If the average
price calculated pursuant
to the preceding sentence is equal to or less than $29.00 per
share, the UAM Stock Price
shall be $29.00 per share.
Notwithstanding any other provision of this Agreement, no
fractional shares of
UAM Stock and no certificates or scrip therefor, or other
evidence of ownership thereof,
will be issued. The number of shares of UAM Stock to be
delivered to PIC pursuant
hereto shall be rounded to the nearest whole share.
1.3 Adjustment in Purchase Price. If any adjustment is
required by the
provisions of the following subparagraphs, the portion of the
Purchase Price payable by
UAM to PIC at the Closing will be reduced or increased, as the
case may be, pro rata
with respect to the cash portion, the Note and the Warrant
portion, and the UAM Stock
portion, by a percentage calculated in the following manner:
(a) PIC shall have prepared and delivered to UAM on
or prior to the
date hereof, a list (Schedule 1.3A) of investment advisory
clients of PIC as of September
30, 1994, showing for each client and as of that date, the
client's name, address, fee
arrangements, assets under management, and pro forma annual
billings calculated by
multiplying the assets under management by the annual percentage
fee applicable to such
client under its Investment Advisory Contract with PIC (the
"Original Schedule"). The
Original Schedule shall separately identify each client which is
a Fund (as hereinafter
defined) as such. The Original Schedule shall separately
identify each client that is a
financial services firm and for which PIC provides advisory
services for assets placed
with such firm pursuant to an agreement under which PIC serves as
an investment
manager or submanager for broker-sponsored asset management
programs ("Wrap
Accounts"). Each financial services firm for which PIC provides
advisory services for
assets placed with such firm in Wrap Accounts shall be referred
to herein as a "Wrap
Sponsor" and such firms shall be referred to collectively as the
"Wrap Sponsors". The
Original Schedule and Revised Schedule (as hereinafter defined)
shall identify thereon the
Wrap Sponsors as clients, but not the underlying Wrap Account
holders. Only assets
under management which are accruing fees shall be included on the
Original Schedule or
the Revised Schedule prepared pursuant to subsection (c) below.
Attached to the Original
Schedule is a description of each performance fee arrangement in
place with any client
listed thereon.
(b) Based on negotiations as to the Purchase Price
leading to the
execution of this Agreement, "Base Annual Billings" of PIC for
purposes of this
calculation are $86,034,000.
(c) At the Closing, PIC will deliver to UAM a
revised Schedule 1.3A
(the "Revised Schedule") as of the close of business on the last
business day before the
Closing prepared as follows:
(i) All clients that have terminated their investment
advisory relationship with
PIC or that have notified PIC (orally or in writing)
of their intention to
terminate that relationship since the date of the
Original Schedule shall be
deleted from the Revised Schedule.
(ii) Clients that have engaged PIC since the date of the
Original Schedule shall
be added to the Revised Schedule with their assets
under management by
PIC included in the Revised Schedule at the value of
those assets on the
date PIC's management of those assets commenced.
(iii) For clients that have withdrawn assets from
management by PIC since the
date of the Original Schedule, assets under
management for such clients
shall be reduced from the Original Schedule by the
same percentage as is
calculated by dividing (A) the value of the assets
withdrawn as of the date
of withdrawal, by (B) the aggregate value of assets
managed by PIC for
such client immediately prior to the withdrawal. If
as of the Closing Date
PIC has knowledge of any prospective withdrawal of
assets under
management for any client, assets under management
for such client on the
Revised Schedule shall be reduced by the same
percentage as is calculated
by dividing (A) the value of the assets proposed to
be withdrawn by (B) the
aggregate value of assets managed by PIC for such
client as of the last
business day before the Closing.
(iv) For clients that have added to assets under
management since the date of
the Original Schedule, assets under management for
such clients shall be
increased from the Original Schedule by the value of
those added assets on
the date PIC's management of the assets commenced.
(v) Pro forma annual billings for each client shall be
calculated in the same
manner as in the Original Schedule, after giving
effect to the adjustments
made to assets under management pursuant to
subparagraphs (i) to (iv)
above and to any reductions in fees.
(vi) The Revised Schedule shall not reflect fluctuations
in the market value of
assets under management since the date of the
Original Schedule (except as
expressly provided in subparagraphs (ii), (iii) and
(iv) above) or increases
(if any) in PIC's fee schedule subsequent to that
date.
Pro forma annual billings shown on this Revised Schedule are
referred to as "Assigned
Annual Billings." The advisory agreements between PIC and the
clients listed on the
Original and Revised Schedules are referred to herein as
"Investment Advisory
Contracts."
(d) Assigned Annual Billings shall then be divided
by Base Annual
Billings, and the resulting percentage shall be determined to the
nearest one-hundredth of
a percent (the "Adjustment Percentage").
(e) Calculation of Revaluation Percentage.
(i) If the Adjustment Percentage is 95 per cent to 105
per cent , there shall be
no reduction or increase in the Purchase Price
payable at the Closing.
(ii) If the Adjustment Percentage is 70 per cent or more,
up to 95 per cent,
then the Purchase Price payable at the Closing shall
be reduced in
accordance with the following table, with
interpolation as necessary
between percentages rounded to the nearest
one-hundredth of a percent:
Percent by which
Purchase
Adjustment Percentage Price shall be Reduced
95 per cent 0 per cent
94 1
93 2
92 3
91 4
90 5
* * * * * *
89 per cent 5 1/2 per
cent
88 6
87 6 1/2
86 7
85 7 1/2
[and so forth
down to]
75 per cent 12 1/2 per
cent
74 13
73 13 1/2
72 14
71 14 1/2
70 15
(iii) If the Adjustment Percentage is less than 70 per
cent, UAM may elect not
to proceed under this Agreement in accordance with
Section 9.5 and PIC
may elect not to proceed under this Agreement in
accordance with Section
10.7.
(iv) If the Adjustment Percentage is greater than 105 per
cent, the portion of the
Purchase Price payable at the Closing shall be
increased in accordance with
the following table, with interpolation as necessary
between percentages
rounded to the nearest one-hundredth of a percent,
subject to the provisions
of paragraph (v) below:
Percent by which
Purchase
Adjustment Percentage Price shall be
Increased
105 per cent 0 per cent
106 1
107 2
108 3
109 4
110 5
111 5 1/2 per cent
112 6
113 6 1/2
114 7
115 7 1/2
116 8 per cent
117 8 1/2
118 9
119 9 1/2
120 10
121 10 1/2 per cent
122 11
123 11 1/2
124 12
125 12 1/2
126 13 per cent
127 13 1/2
128 14
129 14 1/2
130 or above 15
(v) Notwithstanding any of the foregoing provisions of
Section 1.3 to the
contrary, if the Closing occurs after January 27,
1995, the amount of any
increase in the portion of the Purchase Price payable
at the Closing by
UAM shall be the lesser of such amount calculated as
of January 27, 1995,
(using a revised Schedule 1.3A prepared as of January
27, 1995, and such
amount calculated as of the Closing, and for purposes
of such calculations
revised Schedules 1.3A shall be prepared both as of
January 27, 1995, and
as of the close of business on the last business day
prior to the day the
Closing is actually held.
The percentage by which the Purchase Price shall be
decreased or increased (i.e.,
the percentage determined from the right-hand column in the
tables above) is referred to
herein as the "Revaluation Percentage".
(f) An example of the operation of this Section 1.3
is set forth on
Schedule 1.3B hereto.
1.4 Contingent Payment. One contingent payment (the
"Contingent Payment")
in an aggregate amount that shall not exceed $125,000,000 reduced
by the amount of any
Extension Bonus Payment payable by UAM pursuant to Section 11.10
below (the
"Overall Limitation") shall be paid to PIC in the amount, in the
manner and on the date
indicated below:
(a) Based on negotiations as to the Purchase Price
leading to the
execution of this Agreement, the term UAMs Base Share of Revenues
shall mean
$43,017,000, provided that if an increase or a reduction in the
portion of the Purchase
Price payable at the Closing is made in accordance with Section
1.3 because the
Adjustment Percentage is less than 95 per cent or greater than
105 per cent, the term
UAMs Base Share of Revenues" shall mean $43,017,000 increased or
reduced, as the
case may be, by the same percent by which the portion of the
Purchase Price payable at
the Closing was increased or reduced pursuant to Section 1.3.
(b) To the extent that UAMs Share of Revenues, as
that term is used in
the Revenue Sharing Agreement (as hereinafter defined) and
adjusted to normalize
performance fees in accordance with the normalization of
performance fees as reflected in
Schedule 1.3A, for the year ending December 31, 1997 exceeds UAMs
Base Share of
Revenues, the latter shall be deducted from the former, the
difference shall be multiplied
by seven, and the product shall be reduced by the amount of any
Extension Bonus
Payment payable by UAM pursuant to Section 11.10 below to
determine the amount of
the Contingent Payment, if any, due; subject to the Overall
Limitation.
(c) The Contingent Payment, if any, shall be paid
by UAM to PIC, or
PIC's successors in interest on or before March 1, 1998 (the
"Contingent Closing Date"),
and shall be paid in cash by wire transfer in same day funds,
principal amount of
UAM's Note (the "Contingent Note") and Warrant Agreement and
Certificate evidencing
the right to purchase a number of shares of UAM Common Stock
equal to the number
produced by dividing the principal amount of the Contingent Note
by $45.31 (subject to
adjustment in accordance with Section 5 of the Warrant Agreement)
(the "Contingent
Warrant") and UAM Common Stock (the Contingent Stock) in pro rata
amount based on
the relative amounts of such consideration paid at Closing;
provided, however, that (i) no
Contingent Payment shall be paid unless all provisions in the
Revenue Sharing Agreement
requiring certain amounts to be distributed to UAM have been
complied with in all
material respects (ii) at PIC's option and upon notice to UAM at
least thirty days prior to
the Contingent Closing Date, the portion of the Contingent
Payment that shall be paid in
cash may be decreased and the portion of the Contingent Payment
that shall be paid in
Contingent Note and Contingent Warrant may be correspondingly
increased up to a
maximum amount of $10,000,000; and (iii) any Extension Bonus
Payment payable by
UAM pursuant to Section 11.10 below shall be charged against the
cash portion of the
Contingent Payment.
(d) The per share price of Contingent Stock to be
used in calculating the
number of shares of Contingent Stock to be delivered pursuant to
this section (the
Contingent Stock Price) shall be the average of the closing price
of UAMs Common
Stock for the twenty (20) successive trading days ending on the
tenth trading day
preceding the Contingent Closing Date (the "Pricing Date") as
reported by the New York
Stock Exchange (or other exchange or market on which such stock
is quoted), subject to
the following. The amount of the Contingent Payment, if any, to
be paid in Contingent
Stock pursuant to this section may be paid by UAM in cash by wire
transfer in same day
funds, at UAMs option, if the Contingent Stock Price is less than
the Contingent Stock
Price Lower Limit as defined in the following sentence. For
purposes of this section, the
"Contingent Stock Price Lower Limit" shall be the higher of (i)
$29.00 per share; and (ii)
80 per cent of the average of the closing price of UAMs Common
Stock for the last
trading day of each of the fifty-two (52) successive weeks ending
with the week
immediately preceding the Pricing Date as reported by the New
York Stock Exchange (or
other exchange or market on which such stock is quoted).
(e) The Contingent Note shall have the same terms
and shall be in the
same form as the Note (Exhibit A), except that it shall be due
seven years from the date
of the Contingent Closing. An additional Subordination Agreement
substantially in the
form of Exhibit B shall be executed at the time of issuance of
the Contingent Note.
(f) The Contingent Warrant shall have the same
terms as provided in
Section 1.2 above, including the exercise price as therein
provided; shall be in the same
form as the Warrant (Exhibit D); subject to the terms of the
Warrant Agreement (Exhibit
C), except that it shall be exercisable at any time up to or on
the seventh anniversary date
of the Contingent Closing. An additional Warrant Agreement in
the form of Exhibit D
shall be executed at the time of issuance of the Contingent
Warrant.
(g) An example of Contingent Payment calculations
is provided in
Schedule 1.4 hereto.
1.5 Obligations Assumed by Newco. As further
consideration for the sale of
the Assets by PIC to UAM and subject to the provisions of Article
VIII and Section 9.15
hereof, Newco agrees, upon the terms and subject to the
conditions set forth herein, to
assume at the Closing all obligations of PIC to perform or
provide services after the
Closing Date under the Investment Advisory Contracts and the
contracts and other
agreements listed on Schedules 3.10A, 3.12 and 3.15, to the
extent the same shall exist
on the Closing Date (the "Assumed Obligations"). Nothing in this
Agreement or any
Related Agreement (as defined herein) shall require UAM or Newco
to assume, and
UAM and Newco do not assume, any other liabilities or obligations
of PIC to any person
or entity.
Article II. The Closing.
The closing of the transactions contemplated hereby (the
"Closing") will take place
at 10:00 a.m. at the offices of PIC on January 27, 1995, or at
such other later time and
other place as the parties hereto may mutually agree upon (the
"Closing Date").
Notwithstanding the foregoing, if as of such date one or more of
the meetings of the
shareholders of the Funds contemplated by Section 7.6 below has
or have not been held,
then PIC shall have the right to defer the Closing to a later
reasonable date and time, but
in no event shall such date be later than March 15, 1995.
Article III.Representations and Warranties of PIC and the
Stockholders.
As a material inducement to UAM and Newco to enter into and
perform this
Agreement, PIC and the Stockholders jointly and severally
represent, warrant, covenant
and agree that:
3.1 PIC's Organization and Corporate Authority. PIC is a
corporation duly
organized, validly existing and in good standing under the laws
of the State of California,
with full power and authority to own or lease and use its
properties and assets, to carry
on its business as such business is now conducted, to execute and
deliver this Agreement,
and to consummate the transactions contemplated hereby. PIC is
duly qualified to do
business as a foreign corporation under the laws of each
jurisdiction in which the conduct
of its business requires such qualification or license, except
for jurisdictions where failure
to so qualify or be licensed would not have a material adverse
effect on PIC's business.
3.2 Charter, By-Laws and Minutes. The copies of the
Articles of Organization
of PIC as certified by the Secretary of State of California; the
By-laws of PIC as
certified by its Secretary; and the minutes of meetings of its
Board of Directors and
stockholders (or consents in lieu thereof) furnished to UAM by
PIC, are true, correct and
complete and conform to the originals thereof.
3.3 No Violation. Neither the execution and delivery by
PIC or the
Stockholders of this Agreement or of any other agreement or
instruments required by the
provisions of this Agreement (collectively, the "Related
Agreements") to which PIC or
the Stockholders may be parties, nor consummation of the
transactions herein or therein
contemplated, nor compliance with the terms, conditions and
provisions hereof or thereof
will conflict with or violate any provision of law or the
Articles of Incorporation or By-
laws of PIC, or result in a violation or default in any provision
of any regulation, order,
writ, injunction or decree of any court or governmental agency or
authority or of any
agreement or instrument to which PIC or a Stockholder is a party
or by which PIC or a
Stockholder is bound or to which PIC or a Stockholder is subject,
or constitute a default
thereunder or result in the imposition of any lien, charge,
encumbrance or security
interest of any nature whatsoever upon any of PIC's property
pursuant to the terms of any
such agreement or instrument (except as contemplated by this
Agreement), assuming that
all of the consents contemplated by Section 7.1 have been
received and provided that the
actions contemplated by Article VII are taken and the provisions
of 15 U.S.C. Sec.18(a)
and (b) (the "Hart-Scott-Rodino Act") shall have been complied
with pursuant to Section
9.19 hereof. The parties recognize that consummation of the
transaction contemplated
herein will result in the automatic termination of PIC's
investment advisory agreements
relating to the Funds described in Section 3.25 and that new
agreements may be entered
into by Newco in accordance with the procedures established by
the Investment Company
Act of 1940 and the regulations promulgated thereunder.
3.4 The Stockholders. Except as set forth in Schedule 1,
the Stockholders own
all of the issued and outstanding shares of PIC's capital stock
listed next to their
respective names in Schedule 1 hereto, free and clear of all
agreements, charges, options,
liens, security interests, pledges, claims, restrictions and
encumbrances of any nature
whatsoever. PIC has authorized capital stock consisting of
1,000,000 shares of common
stock, $1.00 par value, of which 166,020 shares are validly
issued and outstanding, fully
paid, non-assessable and entitled to vote. There are outstanding
no rights to purchase of
any kind affecting any shares of the capital stock of PIC,
whether or not outstanding.
3.5 Financial Statements. The Stockholders and PIC have
delivered to UAM
audited balance sheets of PIC as at the close of its fiscal years
ended December 31, 1991
through December 31, 1993, together with related audited
statements of income,
stockholders' equity and cash flow for the respective years then
ended, certified by or
accompanied by a report of independent public accountants, all of
which balance sheets
and financial statements (including the notes thereto) for such
three-year period are
collectively called the "Audited Financials" and are attached
hereto as Exhibit G.
The Stockholders and PIC have also delivered to UAM an
unaudited balance sheet
as of September 30, 1994, together with related statements of
income, stockholders'
equity and cash flow for the [9]-month period then ended and will
deliver to UAM prior
to the Closing an unaudited balance sheet as of the end of the
second month next
preceding the month in which the Closing Date occurs, together
with unaudited
statements of income, stockholders' equity and cash flow of PIC
for the post-December
31, 1994, period then ended, certified by the principal financial
and accounting officer of
PIC, all of which balance sheets and financial statements
(including the notes thereto) are
referred to collectively as the "Unaudited Financials" and are or
prior to the Closing will
be attached hereto as Exhibit H. The Audited Financials and the
Unaudited Financials
are hereinafter sometimes collectively referred to as the
"Financial Statements."
The Financial Statements, when delivered in accordance with
this Section, will
fairly present the financial position and results of operations
of PIC on the dates and for
the fiscal periods then ended, in accordance with generally
accepted accounting principles
which, except as may otherwise be noted in the footnotes thereto,
have been applied on a
basis consistent with prior periods. The Financial Statements
reflect or provide for all
claims against and all debts and liabilities of PIC, absolute,
accrued, contingent or
otherwise, as at the dates thereof in accordance with generally
accepted accounting
principles, except for certain year-end accruals reflected on or
omitted from the
Unaudited Financials which are not individually or in the
aggregate material.
Schedule 3.5 hereto lists and will list (as modified as of
the Closing Date) all
material claims against and all material debts and material
liabilities of PIC, absolute,
accrued, contingent or otherwise, including all material bonuses
payable, or paid since
the date of the latest Financial Statements, and taxes due as at
the date hereof, and as of
the Closing Date.
PIC has no liability of any nature, contingent or
otherwise, which is not fully
reflected or reserved against in the Audited Financials for the
year ended
December 31, 1993, or in the Unaudited Financials or listed in
Schedule 3.5.
Attached to Schedule 3.5 is a projected statement of cash
flow for the twelve-
month period immediately following the Closing Date. Such
statement was prepared on a
basis consistent with the Financial Statements and was prepared
in good faith based on
assumption which PIC and the Stockholders consider to be
reasonable.
3.6 No Adverse Change. Since September 30, 1994, (a)
there has been no
material adverse change in the financial condition, results of
operations, assets, liabilities
or business of PIC; (b) there have been no dividends or other
distributions with respect to
PIC's capital stock paid or declared by PIC except as disclosed
to UAM in Schedule 8
hereto; (c) PIC has not issued or sold any shares of its capital
stock; and (d) the physical
properties owned or leased by PIC have not suffered any
destruction or damage,
regardless of whether or not the loss suffered was insured, that
would materially
adversely affect PIC's business.
3.7 Subsidiaries. PIC has no subsidiaries. PIC does not
own, directly or
indirectly, other than for investment purposes, any of the
capital stock of any corporation,
association, trust or similar entity, any interest in the equity
of any partnership or similar
entity, any share in any joint venture, or any other equity or
proprietary interest in any
entity or enterprise, however organized and however such interest
may be denominated or
evidenced.
3.8 Taxes. PIC has filed all federal, state, local and
other tax returns which
are required to be filed by it and which were due prior to the
date of this Agreement and
has paid all taxes shown thereon, including without limitation
all taxes on properties,
income, business and occupation, licenses, sales and payrolls.
All federal, state, local
and other taxes accruable since the end of the respective periods
covered by such returns
and up to the date hereof and the Closing Date have or will have
been paid or accrued on
the books of PIC (other than taxes on so-called built-in gain
which will be calculated and
paid in accordance with Section 6.2 hereof). The tax returns of
PIC for the last five
fiscal years up to December 31, 1993 heretofore delivered to UAM
are true, accurate and
complete in all material respects, and fairly present the
information purported to be
shown therein, and reflect all material tax liabilities of PIC
for the periods covered
thereby. The Financial Statements include adequate reserves or
liabilities for all accrued
and unpaid federal, state and local taxes of PIC, whether or not
disputed, for the fiscal
year ended December 31, 1993, and the post-December 31, 1993
periods covered thereby
and for all fiscal periods prior thereto or arising out of
transactions entered into or any
state of facts existing on or prior to the dates thereof.
On March 13, 1989, PIC filed a valid election under Section
1362 of the Internal
Revenue Code ("Code") to be an S corporation governed by the
provisions of Subchapter
S of the Code effective January 1, 1989. Such election has not
been revoked. PIC, at
the time of the filing of the election, and since such filing,
has met all of the requirements
of Subchapter S of the Code to be eligible for treatment as an S
corporation under the
Code.
No federal income tax returns of PIC filed for any period
beginning after
December 31, 1987, have been audited by the Internal Revenue
Service, and PIC has
granted no power of attorney to any person to represent it before
the Internal Revenue
Service. No federal or state tax liabilities have been assessed
or proposed which remain
unpaid. Neither PIC nor any of the Stockholders is aware of any
basis upon which any
liability for a material amount of additional taxes could be
incurred. No state excise or
business and occupation tax returns of PIC filed for any period
beginning after December
31, 1987, have been audited, and no state tax liabilities have
been assessed or proposed
which remain unpaid.
Present taxes which PIC is required by law to withhold or
collect have been
withheld or collected and have been paid over to the proper
governmental authorities or
are properly held by PIC for such payment, and all withholdings,
collections or other
payments payable in connection therewith as of the dates of the
Unaudited Financials, are
fully reflected or disclosed in the balance sheets included as a
part of the Unaudited
Financials as at such dates and for the periods then ended. All
such taxes are and will be
so withheld, collected, paid over or held for payment as of the
date of this Agreement
and the Closing. No waivers of statutes of limitations with
respect to any tax returns of
PIC nor extensions of time for the assessment of any tax have
been given which are now
in effect.
Neither PIC nor the Stockholders have taken or will take
any action other than in
the ordinary course of business and other than the transactions
to occur pursuant to this
Agreement which would create a tax liability of PIC that would
become such on or after
the Closing Date.
3.9 Interests of Officers. Except for normal advances
for business expenses
incurred in the ordinary course of business, no officer,
director, or stockholder of PIC
nor any affiliate of any of the foregoing parties has any loan or
other obligation
outstanding to or from PIC or for which PIC is or may be liable
under guaranty or
otherwise, or has any material interest in any firm, person or
entity with which PIC has
entered into any contract or lease, or with which PIC does
business and which would
influence that person in doing business with PIC, other than as
disclosed in Schedule 3.9.
3.10 Property. PIC's assets which consist of real estate
or leasehold interests in
or options on real estate are listed on Schedule 3.10A, together
with all "Encumbrances"
(as hereinafter defined) thereon. PIC has good and marketable
title to all real property
owned by it, free of all encumbrances other than those identified
on Schedule 3.10A.
Also set forth on Schedule 3.10A is a list of personal
property (including without
limitation machinery, equipment, furniture and computer software)
owned, leased by or
under option to PIC with an individual net book value at
September 30, 1994 in excess of
$10,000 for owned property or with individual annual lease
payments in excess of
$10,000 for leased property, together with all "Encumbrances"
thereon. Prior to the
Closing, PIC should deliver to UAM a complete Fixed Asset listing
for financial
reporting purposes. The term "Encumbrances" shall mean all
claims, liens, pledges,
mortgages, security interests, encumbrances, charges, options,
defaults, equities or
restrictions or other matters, if any, affecting PIC's title to,
ownership of, or lease
interest in any of the scheduled property.
Schedule 3.10A includes a description of the terms of the
aforesaid leases and
options or, in lieu thereof, copies of such leases and options.
All leases listed on
Schedule 3.10A are in good standing and are valid and effective
in accordance with their
respective terms, and there is not under any such lease any
existing default of PIC or
event which with notice or lapse of time or both would become a
default of PIC. The
assignment of such leases pursuant hereto will not constitute a
default or event of default
of PIC thereunder; provided, however, that the parties
acknowledge that the consent of
PIC's landlord under its lease of primary office space [is]
required. The Encumbrances
set forth in Schedule 3.10A do not singly or in the aggregate
materially affect the value
of such real or personal property or impair the use thereof in
PIC's business as now
conducted. All personal property of PIC has been properly
maintained and is in good
order and repair, ordinary wear and tear excepted and is operable
and fit to be used for
its intended purposes.
PIC owns free and clear of all Encumbrances the bonds,
debentures, notes, stock
and other securities listed on Schedule 3.10B hereto, and none
other.
3.11 Accounts Receivable. The accounts receivable
reflected in the Unaudited
Financials of September 30, 1994 arose in the ordinary course of
business and have been
collected in full or are fully collectible or, if not fully
collectible, have been written off or
have had adequate reserves established therefor. Set forth on
Schedule 3.11 hereto is a
list of all accounts receivable of PIC which were billed as of
September 30, 1994,
showing the name of each debtor and the amount due on each
account, and indicating any
amount past-due on each account and any write-off or reserve
against each such account.
Such accounts receivable are likewise fully collectible, unless
otherwise indicated.
Schedule 3.11 shall be supplemented at the Closing to reflect
accounts receivable as of
the Closing Date. Except as disclosed on Schedule 3.11 hereto,
no agreements have been
in effect since January 1, 1994 or are now proposed which would
require any delay in
payment of any fees payable under the Investment Advisory
Contracts.
3.12 Insurance. Each insurance policy which is maintained
by PIC with respect
to its business or properties or upon the life of any person
employed by PIC is set forth
on Schedule 3.12 hereto showing the amount of coverage under each
such policy, other
than life insurance policies owned by employees for which PIC
pays the premiums. The
listed policies are reasonably adequate to protect the insured
properties against the insured
risks, at current replacement values, subject to reasonable
deductibles, and the risks
insured against are normal for the industry. All such policies
are assignable, except as
set forth on Schedule 3.12.
3.13 Names, Franchises, Permits, Etc. To its best
knowledge, PIC has the right
to use its name in every state in which it now does business.
Except as noted on
Schedule 3.13 hereto, PIC has no franchises, permits, licenses,
trademarks, trade names,
patents, patent applications, copyrights, trade secrets, computer
software, formula,
designs or inventions and none of the same are necessary to
conduct its business as now
operated without infringing on the rights of any other person.
To the best knowledge of
the Stockholders and PIC, PIC has not infringed or violated in
any way any trademark,
trade name, copyright, trade secret rights or contractual
relationships of others, and has
not received any notice, claim or protest respecting any such
violations or infringement.
PIC has not given any indemnification to any person for any such
violations or
infringements.
3.14 Investment Advisory Contracts. The Original Schedule
1.3A is true,
complete and accurate and has been prepared as described in
Section 1.3(a) above. As of
the Closing Date, the Revised Schedule 1.3A shall be true,
complete and accurate and
prepared in accordance with Section 1.3(c) above. Each client
listed on the Original and
Revised Schedule 1.3A is being or will be as of the date thereof
served by PIC in
accordance with the information in such Schedule, and PIC has no
knowledge of any
prospective termination by any such client of its Investment
Advisory Contract or
withdrawal of assets from management by PIC except as set forth
therein. True, correct
and complete copies of all Investment Advisory Contracts have
been provided or made
available to UAM. Schedule 1.3A separately identifies each
Investment Advisory
Contract which in any material respect by its terms provides any
client with the most
favorable provisions offered to any other client of PIC (any
"most favored nation
provisions") or which provides for any contingently returnable
fees. Each of the
Investment Advisory Contracts to which PIC is a party is a legal,
valid and binding
obligation of PIC and, to the knowledge of PIC, each of the other
parties thereto
enforceable in accordance with its terms, subject to (i)
applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance and transfer
and other similar laws of
general application, heretofore or hereafter enacted or in
effect, affecting the rights and
remedies of creditors generally, and (ii) the exercise of
judicial or administrative
discretion in accordance with general equitable principles,
particularly as to the
availability of the remedy of specific performance or other
injunctive relief (the
"Remedies Exception"). PIC is not in breach, violation or
default under any such
agreement. PIC has no arrangements or understandings relating to
PIC's rendering of
investment advisory services to anyone which are not disclosed on
the Original and
Revised Schedule 1.3A.
PIC has heretofore delivered to UAM a listing as of
September 30, 1994 of all
persons holding Wrap Accounts with Wrap Sponsors and managed by
PIC identifying
each such person's assets under management by PIC, and the nature
of the advisory
services provided by PIC. At the Closing, PIC shall deliver a
revised listing of all such
information prepared as of the third to last business day before
the Closing
3.15 Other Contracts. All contracts (other than
Investment Advisory Contracts)
to which PIC is a party or by which PIC is bound and which are
material to PIC's
business and are not identified on any other Schedule hereto, and
all confidentiality
agreements obtained from parties other than UAM are listed on
Schedule 3.15 hereto.
PIC is not obligated under any contract or agreement which
materially and adversely
affects its business, properties, prospects, assets or condition,
financial or otherwise.
Except as listed on Schedule 3.15, PIC is not a party to
any loan agreement or
bank credit agreement.
PIC has given no power of attorney to any person or entity
which is presently
outstanding or in force for any purpose whatsoever except as
listed on Schedule 3.15.
PIC is not in default under (nor is PIC or any of the
Stockholders aware of any
fact or event which with the lapse of time or the giving of
notice or both would constitute
a default under) any contract made or obligation owed by it which
would result in a
liability that would materially adversely affect the business of
PIC.
3.16 Certain Salaried Employees. Set forth on Schedule
3.16 attached hereto is
a list of all present employees of PIC who each were paid in
fiscal year 1993 or are
currently being paid on an annualized basis a salary equal to or
greater than $60,000.
Also set forth on Schedule 3.16 with respect to each such
employee is the following
information: (a) the aggregate amount paid as salary in fiscal
year 1993; (b) the amount
of salary currently being paid on an annualized basis; (c) the
nature (e.g., cash bonus)
and amount of all aggregate direct and indirect remuneration
other than salary paid during
fiscal year 1993; (d) the nature and amount of all aggregate
direct remuneration
proposed to be paid during fiscal year 1994; and (e) a list of
any employment
agreements between PIC and such employee. True, correct and
complete copies of all
employment agreements listed on Schedule 3.16 have been provided
to UAM.
3.17 Bank Accounts and Money Market Funds. Set forth on
Schedule 3.17 hereto is the name and location of each bank and
money market
fund in which PIC has an account or accounts or safe deposit
boxes, the name
and number of each account or box, the names of persons
authorized to draw
thereon or having access thereto, and the balance of each account
and the
contents of each box as of the date indicated thereon. Such
Schedule shall be
up-dated as of the Closing Date.
3.18 Litigation. There are no actions, suits, proceedings
or
investigations of any kind pending, or, to the knowledge of PIC
or any of the
Stockholders, threatened before any court, commission, agency or
other
administrative authority against PIC or any of its stockholders
or directors, or
its businesses or properties, and PIC is not the subject of any
order or decree.
3.19 Finder's Fee. Neither PIC nor any Stockholder has
incurred any
obligation of any kind whatsoever to any party for a finder's fee
in connection
with the transactions contemplated by this Agreement other than
an obligation
to Goldman Sachs & Co. for which PIC will be solely liable.
3.20 Employee Benefit Plans. Schedule 3.20 attached
hereto lists all
deferred compensation, pension, profit sharing and retirement
plans, and all
material bonus and other employee benefit or fringe benefit plans
maintained by
PIC or with respect to which contributions are made by PIC
(including health,
life insurance and other benefit plans maintained for retirees).
Said plans,
including but not limited to all plans or programs that
constitute "employee
benefit plans" as defined in Section 3(3) of the Employee
Retirement Income
Security Act of 1974, as amended ("ERISA"), are sometimes
collectively
referred to in this section as "Benefit Plans." True and
complete copies of all
Benefit Plans, including any insurance contracts under which
benefits are
provided, as currently in effect have been provided to UAM. UAM
has also
been provided with a true and complete copy of the summary plan
description,
if any was required by ERISA to be prepared and distributed to
participants, for
each Benefit Plan. Except as set forth in Schedule 3.20:
(a) PIC has fulfilled its obligations to the extent
applicable under
the minimum funding requirements of Section 302 of ERISA and
Section 412 of
the Internal Revenue Code of 1986, as amended (the "Code"), with
respect to
each Benefit Plan. PIC has made all payments to all Benefit
Plans as required
by the terms of each such plan and any applicable collective
bargaining
agreements and in accordance, if applicable, with the actuarial
and funding
assumptions in effect as for the most recent actuarial valuation
of such plans
and the quarterly contribution requirements of Section 302(e) of
ERISA and
Section 412(m) of the Code. No lien exists on any of PIC's
assets pursuant to
Section 302(f) of ERISA or Section 412(n) of the Code. A copy of
the most
recent actuarial valuation and report for each defined benefit
pension plan has
been provided to UAM. Except as disclosed on Schedule 3.20, PIC
has funded
or will fund each Benefit Plan in accordance with its terms
through the Closing,
including the payment of applicable premiums on any insurance
contract
funding a Benefit Plan for coverage provided through the Closing.
(b) Each Benefit Plan is in compliance in all
material respects
with the presently applicable provisions of ERISA and the Code,
including but
not limited to the satisfaction of all applicable reporting and
disclosure
requirements under ERISA and the Code. PIC has filed or caused
to be filed
with the Internal Revenue Service annual reports on Form 5500 or
5500C and
5500R, if applicable, for each Benefit Plan for all years and
periods for which
such reports were required, and such reports for the past five
years have been
provided to UAM.
(c) No "prohibited transaction," as defined in
Section 406 of
ERISA and Section 4975 of the Code, has occurred in respect of
any Benefit
Plan which could give rise to any liability or tax under ERISA or
the Code on
the part of PIC, and no civil or criminal action brought pursuant
to part 5 of
Title I of ERISA is pending or is threatened in writing or orally
against any
fiduciary of any such plan, other than claims for benefits in the
normal course.
(d) The Internal Revenue Service has issued a
letter for each
employee pension benefit plan (as defined in Section 3(2) of
ERISA)
determining that such plan is a qualified plan under Section
401(a) of the Code
and is exempt from Federal income tax under Section 501(a) of the
Code, and,
to the best knowledge of PIC, there has been no occurrence since
the date of
any such determination letter which has adversely affected such
qualification.
(e) The assets of each Benefit Plan that is subject
to Title IV of
ERISA will, as of the Closing, be sufficient to pay all "benefit
liabilities" as
defined in Section 4001(a)(16) of ERISA. There shall not be as
of the Closing
any outstanding unpaid minimum funding waiver within the meaning
of
Section 412(d) of the Code.
(f) There has not been any (1) termination or
partial termination
of any employee pension benefit plan (as defined in Section 3(2)
of ERISA)
maintained by PIC (or by any person, firm or corporation which is
or was
under common control within the meaning of Section 4001(c) of
ERISA, with
PIC (hereinafter called "an Affiliate") during the period of such
common
control, at a time when Section 4021 of ERISA applied to such
plan), (2)
commencement of any proceeding to terminate any such plan
pursuant to
ERISA, or otherwise, or (3) written notice given to PIC or any
Affiliate of the
intention to commence or seek the commencement of any such
proceeding,
which (under (1)) resulted or (under (2) or (3)) would result in
any
insufficiency of plan assets necessary to satisfy benefits
guaranteed under
Section 4022 of ERISA or benefits vested under the plan. Any
termination of
any employee pension benefit plan has been disclosed in Schedule
3.20 attached
hereto and was accomplished in accordance with the requirements
of ERISA
(including ERISA Section 4041, if applicable) and the Code and
all applicable
regulations in effect under ERISA and the Code in effect at the
time the
termination occurred. No "Reportable Event" as defined in
Section 4043 of
ERISA (excluding "Reportable Events" for which the 30-day notice
requirement
is waived) has occurred with respect to any pension benefit plan
and neither
PIC nor any of its Affiliates has any liability to the Pension
Benefit Guaranty
Corporation with respect to or arising from the maintenance of
any such plan.
(g) Except as disclosed on Schedule 3.20, neither
PIC nor any of
its Affiliates is a party to any pension plan that is a
"multi-employer plan"
within the meaning of Section 4001(a)(3) of ERISA. Neither PIC
nor any of its
Affiliates currently has any liability to make any withdrawal
liability payment to
any multi-employer plan. Neither PIC nor any of its Affiliates
is delinquent in
making any contributions required to be paid to any
multi-employer plan.
There is no pending dispute between PIC or any of its Affiliates
and any multi-
employer plan concerning payment of contributions or payment of
withdrawal
liability payments.
(h) Each Benefit Plan that provides medical
benefits has been
operated in compliance with all requirements of Sections 601
through 609 of
ERISA and Section 4980B of the Code and regulations thereunder,
relating to
the continuation of coverage under certain circumstances in which
coverage
would otherwise cease.
(i) Schedule 3.20 discloses, and separately
indicates, each plan,
fund or program maintained by PIC that provides post retirement
medical
benefits, post retirement death benefits or other post retirement
welfare
benefits. A copy of any written description of post retirement
welfare benefits
that has been provided to employees has been furnished to UAM. A
copy of
each plan document, insurance contract or other written
instrument providing
for post retirement welfare benefits has been provided to UAM,
together with a
description of any advance funding arrangement that has been
established to
fund post retirement welfare benefits.
3.21 Disclosure. The representations and warranties made
by PIC and
each of the Stockholders in this Agreement and any of their
respective
statements made in any of the Exhibits or Schedules hereto do
not contain any
untrue statement of a material fact or omit to state a material
fact necessary in
order to make any such representation, warranty or statement, in
the light of
the circumstances under which it was made, not misleading.
There is no fact
or condition particularly related to the business of PIC which is
known to PIC
and no Stockholder is aware of any fact or condition particularly
related to the
business of PIC which any of them reasonably believes might
materially
adversely affect the business, property, condition (financial or
otherwise), or
results of operations of PIC and which has not been set forth in
this Agreement
or in an Exhibit or Schedule hereto, except general economic and
securities
market conditions.
3.22 Approvals. No approval, authorization, order,
license or consent
of or registration, qualification or filing with any governmental
authority and no
approval or consent by any other person or entity is required in
connection with
the execution, delivery or performance by PIC and the
Stockholders of this
Agreement and the Related Agreements, other than as contemplated
by Article
VII and Sections 3.25 and 9.19 hereof.
3.23 PIC's Authority. PIC has full right, power and
authority to
execute, deliver and perform this Agreement and the Related
Agreements to
which it is a party, all proper corporate actions of PIC's Board
of Directors and
Stockholders authorizing the execution, delivery and performance
hereof and
thereof having been taken. This Agreement has been duly executed
and
delivered by PIC and constitutes, and the Related Agreements to
which it will
be a party when executed and delivered, will be duly executed and
delivered
and will constitute, valid and legally binding obligations of PIC
enforceable in
accordance with their respective terms, subject to the Remedies
Exception.
There are pending no proceedings or actions to dissolve PIC.
3.24 Stockholders' Authority. The Stockholders have full
right, power
and authority to execute, deliver and perform this Agreement and
each Related
Agreement to which they are parties. This Agreement has been
duly executed
and delivered by the Stockholders and constitutes, and each
Related Agreement
to which they will be parties when executed and delivered will be
duly executed
and delivered and,, will constitute, the valid and legally
binding obligation of
each of them, enforceable in accordance with their respective
terms, subject to
the Remedies Exception.
3.25 Government Regulation. PIC is and has been since
1976 duly
registered as an investment adviser under the Investment Advisers
Act of 1940.
PIC is registered as an investment adviser in the states
referenced in item 7,
Part I of its current Form ADV, and is in compliance with all
state laws
requiring registration, licensing or qualification as an
investment adviser. Each
such federal and state registration is in full force and effect.
PIC has delivered
to UAM a true and complete copy of its Form ADV, as amended to
date, filed
by PIC with the Securities and Exchange Commission; copies of all
state
registration forms, likewise as amended to date; and copies of
all current
reports required to be kept by PIC pursuant to the Investment
Advisers Act of
1940 and rules promulgated thereunder, and required pursuant to
applicable
state statutes. The information contained in such forms and
reports was true
and complete at the time of filing in all material respects. PIC
has filed all
amendments required to be filed to its Form ADV and state
registration forms
under federal and state law. Except as set forth on Schedule
3.25, PIC has
filed all reports required to be filed by it under the Securities
Exchange Act of
1934 (including Sections 13(d), (g) and (f) thereof) and rules
promulgated
thereunder. Schedule 3.25 identifies the examination and/or
certification
qualifications of each of PIC's adviser representatives.
PIC is not an "investment company," within the meaning of
the
Investment Company Act of 1940, which is required to be
registered under that
Act in order to engage in the transactions described in Section 7
of that Act.
PIC is not a "broker" or "dealer" within the meaning of the
Securities
Exchange Act of 1934. Copies of all inspection reports or
similar documents
furnished to PIC by the Securities and Exchange Commission or
state
regulatory authorities since January 1, 1989 are listed on
Schedule 3.25 and
have been provided to UAM. PIC is not required to disclose any
information
to clients under SEC Rule 206(4)-4 promulgated under the
Investment Advisers
Act of 1940.
Except with respect to the entities listed on Schedule 3.25
hereto (each a
"Fund" and collectively the "Funds"), PIC does not act as
investment adviser or
subadviser to any "investment company," as defined in the
Investment
Company Act of 1940, which is registered under such Act. PIC has
a written
investment advisory agreement with each Fund pursuant to which
PIC serves as
investment adviser to each Fund, and has delivered to UAM true
and complete
copies of such agreements. Each of such agreements is in full
force and effect,
PIC is not in default thereunder and, to the best knowledge of
PIC, no Fund
that is a party thereto is in default thereunder. The
investment advisory
agreement relating to each Fund will terminate upon the
consummation of the
transaction contemplated by this Agreement, and new agreements
may be
entered into by Newco in accordance with the procedures
established by the
Investment Company Act of 1940 and the regulations promulgated
thereunder.
Neither PIC nor any Stockholder nor any other "interested
person" of
PIC, as such term is defined in the Investment Company Act of
1940, receives
or is entitled to receive any compensation directly or
indirectly (i) from any
person in connection with the purchase or sale of securities or
other property
to, from or on behalf of any of the Funds, other than bona fide
ordinary
compensation as principal underwriter for the Funds or (ii) from
the Funds or
its security holders for other than bona fide investment advisory
services, or
other services.
3.26 Code of Ethics. PIC has adopted a formal code of
ethics, a true,
complete and accurate copy of which has been provided to UAM.
Its policies
with respect to avoiding conflicts of interest are as set forth
in its Form ADV,
as amended, which has been delivered to UAM. There have been no
instances
of non-compliance with such policies since November 1, 1992,
except as listed
on Schedule 3.26.
3.27 No Practices in Violation of Law. Neither PIC nor
any
Stockholder has engaged in or is now engaging in any act,
conspiracy or course
of conduct in violation of any applicable federal or state law
which would result
in a materially adverse change in the financial condition,
results of operation,
assets, liabilities or business of PIC, and has not received any
notice, claim or
protest that it is now or has heretofore been so engaged.
3.28 Employees' Health. Each employee of PIC listed on
Schedule 3.28
is in good health. Prior to the execution of this Agreement,
each such
employee has delivered to UAM a letter from a licensed physician
familiar with
such person's health indicating that such person is in good
health, which letters
are included in Schedule 3.28.
3.29 Fee Schedule. PIC's fee schedules in effect as of
September 30,
1994 are in full force and effect, and have not been unilateraly
amended by
PIC since January 1, 1990.
3.30 Investment Representations. PIC and the Stockholders
understand
that as of the date when the Note and Warrant are issued to PIC,
such securities
will not have been registered under the Securities Act of 1933,
and the rules
and regulations thereunder (the "Securities Act"), or qualified
under any
applicable state securities laws, on the ground that the transfer
of such
securities to PIC is exempt from the registration and prospectus
delivery
requirements of the Securities Act and from qualification under
any applicable
state securities laws, and that such exemptions are based in part
on the
representations and warranties made herein.
PIC is acquiring the Note and Warrant for its own account
and not for
that of any other persons, and without a view to or in connection
with any
distribution thereof which is proscribed by the Securities Act or
any rule or
regulation thereunder or in violation of any applicable state
securities laws.
PIC and the Stockholders shall not offer, sell or otherwise
dispose of the
Note and Warrant except to the Stockholders upon the liquidation
of PIC or in
conformity with Rule 144 of the Securities and Exchange
Commission or
pursuant to a registration statement under the Securities Act and
qualification
under applicable state securities laws or pursuant to an opinion
of counsel
reasonably satisfactory to UAM that such registration and
qualification is not
required. PIC and the Stockholders acknowledge and agree that
the Note and
Warrant shall be endorsed with the legends set forth in Exhibits
A and D
hereto.
UAM may require as a condition precedent to any proposed
offer, sale,
transfer, pledge, hypothecation or other disposition of the Note
and Warrant by
PIC other than in conformity with Rule 144 of the Securities and
Exchange
Commission or pursuant to a registration statement under the
Securities Act that
the proposed transferee first sign, seal and deliver to UAM an
investment
agreement with respect to the securities to be offered, sold,
transferred,
pledged, hypothecated or otherwise disposed of containing
substantially the
agreements, representations and Warranties set forth in this
Section 3.30.
PIC and the Stockholders acknowledge receipt from UAM of
its Annual
Report to Stockholders for the fiscal year ended December 31,
1993; its proxy
statement in connection with its annual meeting of May 19, 1994;
and its
Quarterly Reports on Form 10-Q for the fiscal quarters ended
March 31, 1994
and June 30, 1994. PIC and the Stockholders represent to UAM (i)
that they
have reviewed such reports and statements; (ii) that they have
been afforded the
opportunity to ask questions and receive answers concerning the
terms and
conditions of the offering of the Note and Warrant hereby and to
obtain any
additional information that UAM possesses or can acquire without
unreasonable
effort or expense that is necessary to verify any of the
information contained in
any such reports and statements; and (iii) that they have such
knowledge and
experience in financial and business matters that they are
capable of evaluating
the merits and risks of an investment in UAM.
Article IV. Representations of UAM and Newco.
As a material inducement to PIC and the Stockholders to
enter into and
perform this Agreement, UAM and Newco represent, warrant,
covenant and
agree, that:
4.1 Organization of UAM and Newco and Corporate
Authority. UAM
is a corporation duly organized, validly existing and in good
standing under the
laws of the State of Delaware, with full power and authority to
own or lease
and use its properties and assets, to carry on its business as
such business is
now conducted, to execute and deliver this Agreement and to carry
out the
transactions contemplated hereby. Newco is a corporation duly
organized,
validly existing and in good standing under the laws of the
Commonwealth of
Massachusetts with full power and authority to own or lease and
use its
properties and assets, to carry on its business as such business
is now
conducted, to execute and deliver this Agreement and to
consummate the
transactions contemplated hereby. Newco has been formed for the
purpose of
the transaction described herein and prior to the Closing will
not engage in
business as an investment adviser, or any other business other
than in
contemplation of the transactions set forth herein. Newco is
duly qualified to
do business as a foreign corporation under the laws of each
jurisdiction in
which the conduct of its business requires such qualification or
license, except
for jurisdictions where failure to so qualify or be licensed
would not have a
material adverse effect on the business to be conducted by it
pursuant hereto
subsequent to the Closing Date.
4.2 No Violation. Neither the execution and delivery by
UAM or
Newco of this Agreement or of any of the Related Agreements to
which UAM
or Newco may be parties, nor consummation of the transactions
herein or
therein contemplated, nor compliance with the terms, conditions
and provisions
hereof or thereof will conflict with or violate any provision of
law or the
Certificate or Articles of Incorporation or By-laws of UAM or
Newco, or result
in a violation or default in any provision of any regulation,
order, writ,
injunction or decree of any court or governmental agency or
authority or of any
agreement or instrument to which UAM or Newco is a party or by
which UAM
or Newco is bound or to which UAM or Newco is subject, or
constitute a
default thereunder or result in the imposition of any lien,
charge, encumbrance
or security interest of any nature whatsoever upon any of UAM's
or Newco's
assets pursuant to the terms of any such agreement or instrument
(except for a
security interest of UAM's lending banks in the stock of Newco),
provided that
the actions contemplated by Article VII hereof are taken and the
consents and
approvals described in Section 4.9 are obtained.
4.3 Finder's Fee. Neither UAM or Newco has incurred any
obligation
of any kind whatsoever to any party for a finder's fee in
connection with the
transactions contemplated by this Agreement.
4.4 Charter, By-laws and Resolutions. The copies of the
respective
Certificate or Articles of Incorporation of UAM and Newco
certified by the
respective Secretaries of State; of the By-laws of UAM and Newco
as certified
by their respective Secretaries; and of resolutions of UAM's and
Newco's
respective Boards of Directors relating to the transactions
contemplated by this
Agreement, furnished by UAM and Newco to PIC and the
Stockholders, are
true, correct and complete copies thereof.
4.5 Financial Statements of UAM. UAM has delivered to
the
Stockholders an audited, consolidated balance sheet of UAM as at
December
31, 1993, together with a related audited, consolidated statement
of income,
stockholders' equity and cash flow for the year then ended,
certified by, or
accompanied by a report of, independent public accountants, which
balance
sheet and financial statements (including the notes thereto) for
such period are
collectively called the "UAM Audited Financials" and are attached
hereto as
Exhibit I.
UAM has also delivered to the Stockholders an unaudited,
condensed,
consolidated balance sheet as of September 30, 1994, together
with an
unaudited, condensed, consolidated statement of income and cash
flow for the
six-month period then ended, which balance sheet and financial
statements
(including the notes thereto) are referred to collectively as the
"UAM Unaudited
Financials " and are attached hereto as Exhibit J. The UAM
Audited Financials
and the UAM Unaudited Financials are hereinafter sometimes
collectively
referred to as the "UAM Financial Statements."
The UAM Financial Statements fairly present the financial
position and
results of operations of UAM on the dates and for the fiscal
periods then ended,
in accordance with generally accepted accounting principles
which, except as
may otherwise be noted in the footnotes thereto, have been
applied on a basis
consistent with prior periods.
4.6 Litigation. Except as may be disclosed in the UAM
reports and
statements referred to in Section 3.30 above, there are no
material actions,
suits, proceedings or investigations of any kind pending or, to
the knowledge of
its responsible officers, threatened against UAM before any
court, commission,
agency or administrative authority.
4.7 Disclosure. The representations and warranties made
by UAM and
Newco in this Agreement and any statements made by them in any of
the
Exhibits or Schedules hereto do not contain any untrue statement
of a material
fact or omit to state a material fact necessary in order to make
such
representation, warranty or statement, in light of the
circumstances under which
they were made, not misleading. There is no fact or condition
particularly
related to the business of UAM which is known to UAM and which
UAM
reasonably believes might adversely affect in a material fashion
the business,
property, condition (financial or otherwise) or results of
operations of UAM
and which has not been set forth in this Agreement or an Exhibit
or Schedule
hereto or disclosed in the UAM reports or statements referred to
in
Section 3.30 above.
4.8 UAM's and Newco's Authority. UAM and Newco have full
right,
power and authority to execute, deliver and perform this
Agreement and the
Related Agreements to which they may be parties, all proper
corporate actions
authorizing the execution, delivery and performance hereof and
thereof having
been taken. This Agreement has been duly executed and delivered
by UAM
and Newco and constitutes, and the Related Agreements to which
they may be
parties will be duly executed and delivered and, when executed
and delivered,
will constitute, valid and legally binding obligations of UAM and
Newco,
enforceable in accordance with their respective terms, subject to
the Remedies
Exception.
4.9 Approvals. No approval, authorization, order,
license or consent
of or registration, qualification or filing with any governmental
authority and no
approval or consent by any other person or entity is required in
connection with
the execution, delivery or performance by UAM and Newco of this
Agreement
and the Related Agreements, other than as contemplated by Article
VII and
Sections 9.19 and 9.20 hereof.
4.10 Capitalization of UAM and Newco. UAM has duly
authorized
50,000,000 shares of Common Stock, $.01 par value, of which
28,283,082
shares were issued and outstanding and 11,808,146 shares were
reserved for
issuance on exercise of outstanding warrants or options or upon
conversion of
outstanding convertible notes, or otherwise, as of November 1,
1994. UAM
also has authorized 5,000,000 shares of Preferred Stock, $1.00
par value, none
of which is outstanding. All of the presently outstanding shares
of capital stock
of UAM are validly issued, fully paid and nonassessable. Newco
has
authorized 100 shares of Common Stock, no par value, of which 100
shares are
outstanding and are owned of record by United Asset Management
Holdings,
Inc., a wholly owned subsidiary of UAM.
4.11 Authorization of Note and Warrant. The Note and the
Warrant and
the Contingent Note and the Contingent Warrant have been duly
authorized by
all necessary corporate action of UAM and, when issued, sold and
delivered in
accordance with this Agreement, will constitute the legal, valid
and binding
obligations of UAM enforceable in accordance with their
respective terms,
subject to the Remedies Exception.
4.12 Reservations of Common Stock. The shares of UAM
Common
Stock issuable upon exercise of the Warrant and the Contingent
Warrant have
been duly reserved for issuance upon such exercise and, when
issued, will be
validly authorized, issued and outstanding, fully paid and
nonassessable.
4.13 Authorization of Common Stock. The issuance of
shares of UAM
Common Stock under the terms hereof has been duly authorized by
all
necessary corporate action and, when issued as contemplated by
this Agreement
and the Warrant Agreement, such shares, will be validly issued,
fully paid and
nonassessable.
4.14 No Adverse Change. Since September 30, 1994, (a)
there has been no
material adverse change in the financial condition, results of
operations, assets, liabilities
or business of UAM and (b) there have been no dividends or other
distributions with
respect to UAM's capital stock paid or declared by UAM, except
for UAM's normal
quarterly dividend.
4.15 SEC Reports. UAM has previously furnished PIC with
true and complete
copies of each registration statement and proxy statement filed
since January 1, 1994 by
UAM with the Securities and Exchange Commission (the
"Commission"), and the
following reports filed by UAM with the Commission: UAM's Annual
Reports on Form
10-K for each of the years ended December 31, 1993, 1992, 1991
and 1990 and all
Quarterly Reports on Form 10-Q and all Current Reports on Form
8-K filed after
December 31, 1993. The financial statements and schedules of UAM
contained in said
reports (or incorporated therein by reference) were prepared in
accordance with generally
accepted accounting principles applied on a consistent basis
except as noted therein, and
fairly present the information purported to be shown therein.
Each registration statement,
proxy statement, and Annual Report on Form 10-K filed subsequent
to December 31,
1990 and Quarterly Reports on Form 10-Q and all Current Reports
on Form 8-K filed
subsequent to December 31, 1993 did not, on the date of
effectiveness in the case of such
registration statements, on the date of mailing in the case of
such proxy statements, and
on the date of filing in the case of such reports, contain any
untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to
make the statements therein, in light of the circumstances under
which they were made,
not misleading. No subsidiary of UAM has issued a class of
securities which is required
to be registered under the Securities Exchange Act of 1934.
Article V. Indemnification.
5.1 Indemnification by the Stockholders and PIC. Subject
to all of the
limitations and provisions of this Article V, the Stockholders
and PIC jointly and
severally agree to indemnify defend with counsel reasonably
satisfactory to UAM, and
save and hold UAM and Newco harmless from and against, and
compensate them for,
any and all demands, claims, actions, causes of action,
assessments, damages, liabilities,
losses, diminution in value, expenses, fees, judgments or
deficiencies of any nature
whatsoever (including, without limitation, any unpaid taxes due
from PIC and reasonable
attorneys' fees and other costs and expenses incident to any
suit, action or proceeding
including those incurred in connection with the enforcement of
this Agreement or any
Related Agreement) received, incurred or sustained by them, which
shall arise out of or
result from: any breach of any representation, warranty or
covenant of PIC or the
Stockholders (including without limitation those set forth in
Article III hereof) hereunder
or under any Schedule, Exhibit or Related Agreement; any
violation of the bulk sales law
of the State of California; any non-fulfillment of any covenant
or obligation of PIC or
the Stockholders under this Agreement or any Schedule or Exhibit
hereto or any failure
by PIC to pay or perform when due any liability or obligation of
PIC not expressly
assumed by Newco pursuant hereto.
5.2 Indemnification by UAM. Subject to all of the
limitations and provisions of
this Article V, UAM agrees to indemnify, defend with counsel
reasonably satisfactory to
the Stockholders and PIC, and save and hold the Stockholders and
PIC harmless from and
against, and compensate them for, any and all demands, claims,
actions, causes of action,
assessments, damages, liabilities, losses, diminution in value,
expenses, fees, judgments
or deficiencies of any nature whatsoever (including, without
limitation, any reasonable
attorneys' fees and other costs and expenses incident to any
suit, action or proceeding
including those incurred in connection with the enforcement of
this Agreement or any
Related Agreement) received, incurred or sustained by them, which
shall arise out of or
result from: any breach of any representation, warranty or
covenant of UAM or Newco
(including without limitation those set forth in Article IV
hereof) hereunder or under any
Schedule, Exhibit or Related Agreement; or any non-fulfillment of
any covenant or
obligation of UAM or Newco under this Agreement or any Schedule
or Exhibit hereto.
5.3 Survival of Representations and Warranties. The
representations and
warranties set forth in this Agreement and referred to in
Sections 5.1 and 5.2 above shall
survive the Closing for two years (except that the
representations and warranties of the
Stockholders set forth in Sections 3.8 (Taxes), 3.20 (Employee
Benefit Plans), 4.11
(Authorization of Note and Warrant), 4.12 (Reservations of Common
Stock), and 4.13
(Authorization of Common Stock) of this Agreement shall survive
the Closing for [seven]
years) notwithstanding the establishment of a shorter period by
any applicable statute of
limitations, the provisions of which are hereby waived, provided
that liability with respect
to any representation or warranty as to which a claim is made
within such two-year and
seven-year periods, as applicable, shall continue until finally
determined and paid.
Each claim for indemnification pursuant to this Article V
shall be made in writing
and shall set forth specifically the facts claimed to give rise
to indemnification and the
representations, warranties, covenants or agreements claimed to
be false or to have not
been fulfilled, and the damages claimed as a result thereof.
5.4 Limitation on Liabilities of PIC and the
Stockholders. The following
limitations shall apply to any claim against PIC, a Stockholder
or Stockholders which
shall arise out of or result from any breach of any
representation or warranty (including
without limitation those set forth in Article III hereof)
hereunder:
(a) any claim for a breach of representation or warranty
under Sections 3.4,
3.24 or 3.28 hereof shall be the sole responsibility of the
Stockholder responsible for
such breach;
(b) any other claim for a breach of representation or
warranty under any
Section other than Sections 3.4, 3.24 or 3.28 hereof shall be a
claim against all the
Stockholders as a group, but each Stockholders liability
therefore shall be limited to a pro
rata portion of the total liability, based on his or her
percentage ownership of PIC shares
at this date;
(c) a Stockholder's aggregate liability for a breach of
representations or
warranties hereunder shall in no event exceed such Stockholder's
pro rata portion of the
Purchase Price based on his percentage ownership of PIC shares at
this date;
(d) PIC and the Stockholders shall not be required to
indemnify UAM or
Newco hereunder with respect to any claims for a breach of
representation or warranty
under any Section hereof until the amount of such claims exceed
$500,000, in which
event UAM and Newco shall be entitled to indemnification with
respect to the full
amount of such claims above such limitation.
5.5 Third-Party Claims. Should any claim be made or suit
or proceeding be
instituted against a party entitled to indemnification hereunder
(an "Indemnified Party")
which, if valid or prosecuted successfully, would be a matter for
which they are entitled
to be defended, saved harmless or indemnified under this
Agreement (a "Third-Party
Claim"), the Indemnified Party shall notify parties responsible
for such indemnification
hereunder (the "Indemnifying Parties") in writing concerning the
same promptly after the
assertion or commencement thereof.
The Indemnifying Parties shall control the defense of any
Third-Party Claim
against the Indemnified Parties and the Indemnifying Parties
shall use their best efforts to
defeat or minimize any loss resulting from such Third-Party
Claim. The Indemnifying
Parties shall provide the Indemnified Parties with such
information and opportunity for
consultation as may reasonably be requested by the Indemnified
Parties, and either the
Indemnified Parties or any of them shall be entitled to
participate in the defense of a
Third-Party Claim and to engage counsel at their own expense for
such purpose. The
Indemnifying Parties shall have the right to settle Third-Party
Claims against the
Indemnified Parties on terms which are judged reasonable by the
Indemnifying Parties
and such settlements shall be binding upon the Indemnified
Parties and the Indemnifying
Parties for purposes of indemnification under this Agreement,
provided that the
Indemnified Parties have been held harmless against or
indemnified for amounts agreed to
be paid or amounts paid in such settlement. The Indemnified
Parties shall in any event
render all such assistance as the Indemnifying Parties shall
reasonably request in the
defense of any Third-Party Claim. All costs and expenses
incurred by the Indemnifying
Parties and the Indemnified Parties in connection with the
defense of a Third-Party Claim
shall upon demand be paid by the Indemnifying Parties.
5.6 Set-Off. Any amount or amounts owing from the
Stockholders or PIC to
the Indemnified Parties under this Article V, other than as a
result of a Third-Party Claim
or other loss requiring the payment of money, shall be paid to
UAM by set-off against
any amounts owing to the Stockholders or PIC under the Note, to
the extent such
amounts are sufficient, and the balance of such amounts owing and
any other amount or
amounts owing from the Stockholders or PIC to the Indemnified
Parties under this Article
V may be paid to UAM, at UAM's option, by set-off against any
amounts owing to the
Stockholders or PIC under this Agreement and the Related
Agreements, to the extent
such amounts are sufficient, in all cases without prejudice to
UAM's or Newco's right to
pursue any other remedies at law or in equity in the event such
amounts are insufficient,
and without prejudice to the rights of any such Stockholder to
contribution from or
indemnification by any other Stockholder.
5.7 Exclusivity. The parties hereto agree that,
following the Closing, with
respect to any breach of any representation or warranty
(including without limitation
those set forth in Articles III and IV hereof) hereunder, the
only relief and remedy
available to UAM or Newco or the Stockholders of PIC, as the case
may be, in respect
of said breach shall be (a) damages, but only to the extent
properly claimable hereunder
and as limited pursuant to this Article V or otherwise hereunder;
(b) specific performance
if a court of competent jurisdiction in its discretion grants the
same; or (c) injunctive or
declaratory relief if a court of competent jurisdiction in its
discretion grants the same.
Article VI. Tax Matters.
The parties agree that from and after the date hereof:
6.1 Tax Returns. The parties hereto shall cooperate with
one another to
prepare and file all requisite federal, state and local tax
returns disclosing the
consummation of the transactions contemplated hereunder in a
consistent manner and as a
taxable transaction under the Code. PIC shall prepare and file,
on or before the due date
or any extension thereof, all required federal, state, and local
tax returns with respect to
PIC's operations for the taxable year in which the Closing occurs
and with respect to the
sale of the Assets (and the Stockholders shall properly report on
their personal tax returns
their share of income or loss attributable to them from the
operations of PIC).
6.2 Taxes on Sale. All transfer, excise, income or other
taxes payable by PIC
or the Stockholders by reason of the purchase and sale of the
Assets hereunder (including
without limitation any taxes on so-called built-in gain) shall
be paid by PIC or the
Stockholders.
6.3 Allocation of Purchase Price Among Assets. The
Purchase Price shall be
allocated by UAM in consultation with PIC among the assets of PIC
acquired hereunder
in accordance with the relative fair market values and pursuant
to Section 1060 of the
Code and the regulations thereunder. For purposes of such
allocation, the fair market
values of the such assets, including the Investment Advisory
Contracts, shall be
determined by UAM in consultation with PIC, using an independent
appraiser selected by
UAM as and to the extent deemed necessary by UAM, at UAM's sole
expense,
beginning as soon as practicable after the date hereof. PIC
shall cooperate fully with
such appraisal. The parties hereto shall furnish such
information to the Internal Revenue
Service with respect to allocation of the Purchase Price payable
hereunder as may be
required by Section 1060 of the Code and regulations promulgated
thereunder. UAM and
PIC shall furnish each other with a copy of the information it
proposes to submit to the
Internal Revenue Service at least 30 days prior to the due date
for filing such material
and the parties shall furnish information consistent therewith to
the Internal Revenue
Service in connection with the filing of their 1995 federal
income tax return.
Article VII.Pre-Closing Covenants.
7.1 Procedure for Obtaining Clients' Consents. Following
the execution and
delivery of this Agreement and prior to the Closing, and
thereafter as necessary, the
parties hereto shall cooperate with one another to obtain the
execution of a Client's
Consent substantially in the form of Exhibit K, relating to the
consent of the advisees
(other than the Wrap Accounts and the Funds described in Section
3.25) under all of
PIC's Investment Advisory Contracts to the assignment of such
contracts pursuant hereto.
In connection with the obtaining of such Clients' Consents, the
parties shall cooperate
with one another to make full and complete disclosure of all
facts material to the giving
of such Consents.
Subject to the provisions of Section 7.2, below, within
five business days after the
date hereof, PIC shall notify all of its clients as of such date
of the transaction
contemplated by this Agreement, shall send all of such clients
Clients' Consents, and
shall contact personally (by telephone or face-to-face) at least
one of the "Managers", as
hereafter defined, of each of such clients for the purpose of
procuring the execution by
such clients of Clients' Consents. PIC shall use its best
efforts to procure such execution
in due course. The term "Managers" as used herein shall mean
persons who have or
share the power to decide on behalf of a client whether to
execute a Client's Consent,
such as trustees of a trust which is a client, or appropriate
officers or directors of a
corporation which is a client. At least two weeks prior to the
Closing, PIC shall contact
personally (by telephone or face-to-face) a "Manager" (as defined
above) of each client
which has not yet returned an executed Client's Consent to
inquire as to such client's
intentions. PIC shall deliver to UAM prior to the Closing copies
of all executed Client's
Consents and make available for inspection the originals of such
Consents at or prior to
the Closing.
Promptly following the execution and delivery of this
Agreement, PIC shall
contact each Wrap Sponsor and establish, subject to UAM's
approval, appropriate
procedures to notify persons holding Wrap Accounts managed by PIC
and their brokers
of the transaction contemplated hereby and to obtain appropriate
consents from such
account holders. The initial notifications to such brokers and
account holders and the
related consent requests shall be sent no later than five weeks
prior to the Closing. PIC
shall obtain copies of all written responses to such
notifications and a written report
describing all oral responses to such notifications, all of which
shall be made available to
UAM.
7.2 Non-Disclosure. PIC and the Stockholders agree that
no disclosure of the
negotiation or execution of this Agreement or the transactions
contemplated hereby shall
be made to clients of PIC or to other persons not employed by PIC
or its attorneys and
accountants in advance of the joint publication by UAM and PIC of
a press release on
such matters, except in accordance with procedures established by
UAM in order to
comply with federal securities laws and the rules of the New York
Stock Exchange. PIC
shall consult with UAM in this regard and both parties shall have
joint approval as to the
timing and content of any such press release, subject to UAM's
obligations under such
laws and rules.
7.3 Filings. Prior to or on the Closing Date, the
parties shall cooperate to
prepare and to file all documents and forms and amendments to
forms, including, without
limitation, PIC's Form ADV-W filed with the Securities and
Exchange Commission and
corresponding state forms, Form ADV and corresponding state forms
for Newco, a Form
8-K, a New York Stock Exchange listing application covering UAM
Common Stock
issuable upon exercise of the Warrant and the Contingent Warrant
to be issued hereunder,
applications for state and local tax lien waivers, forms required
by the Hart-Scott-Rodino
Act (as defined in Section 9.22 below) and all other documents
which are or will be
required to be filed or delivered under UAM's New York Stock
Exchange listing
agreement and the Exchange's rules and under applicable federal
and state laws and
regulations promulgated thereunder, including without limitation
the Investment Advisers
Act of 1940 and applicable state advisers acts, as a result of
the consummation of the
transaction contemplated by this Agreement. The parties agree
that any filing fees
payable in connection with compliance with the requirements of
the Hart-Scott-Rodino
Act shall be paid by the parties making the applicable filing.
7.4 Closing Conditions. PIC and the Stockholders shall
use their best efforts to
cause the satisfaction of all conditions precedent to UAM's and
Newco's obligations
hereunder set forth in Article IX. UAM and Newco shall use their
best efforts to cause
the satisfaction of all conditions precedent to PIC's and the
Stockholders' obligations
hereunder set forth in Article X.
7.5 Return of Confidential Information. As soon as
practicable after the
execution hereof, PIC and its agents and representatives shall
exercise their rights under
all confidentiality agreements with parties other than UAM to
obtain the return or
destruction of all confidential information concerning PIC
delivered thereunder.
7.6 Agreement Relating to Mutual Funds. PIC and the
Stockholders agree to
use their best efforts to cause to be prepared and filed with the
Securities and Exchange
Commission proxy materials for meetings of the shareholders of
the Funds and to use
their reasonable best efforts to cause proxy solicitation to be
undertaken in order that such
meetings be held prior to the Closing, at which the approval of
the shareholders of the
Funds will be sought for new investment advisory agreements with
Newco (the "New
Fund Agreements") with respect to the Funds to be effective at
the Closing, and for such
other matters as may be required by the Investment Company Act of
1940, as amended,
including specifically Section 15(f) thereof relating to the sale
of investment advisers.
PIC and the Stockholders agree to seek the approval of the New
Fund Agreements by the
Funds' boards of directors (or the equivalent) acting in
accordance with Section 15(c) of
the Investment Company Act of 1940.
For purposes of preparing a revised Schedule 1.3A as of the
Closing Date, any
Fund which has approved a New Fund Agreement prior to the Closing
shall not be
deemed to have terminated its investment advisory relationship
with PIC; and any Fund
which has not done so shall be deemed to have terminated its
investment advisory
relationship with PIC. The New Fund Agreement with any Fund
which is listed on the
Revised Schedule as of the Closing shall have been approved by
the board of directors (or
the equivalent) and the shareholders of such Fund in conformity
with the Investment
Company Act of 1940, including, without limitation, Sections
15(a) and (c) thereof, and
the regulations promulgated thereunder and with any applicable
state statutes and
regulations, and as of the Closing shall be in full force and
effect. As of the Closing, at
least 75 per cent of the members of the board of directors of
each Fund which is listed on
the Original Schedule or the Revised Schedule as of the Closing
shall not be "interested
persons" (as such term is defined in the Investment Company Act
of 1940) of PIC,
UAM, or Newco and shall have been selected, proposed for
election, and elected in
accordance with Section 16(b) of that Act; and the composition of
the board of directors
of each Fund which is listed on the Revised Schedule as of the
Closing shall comply with
Section 10 of that Act.
Newco and PIC shall each use their best efforts to ensure
that none of the
transactions contemplated by this Agreement will cause the
imposition of an "unfair
burden" (as such term is defined in Section 15(f) of the
Investment Company Act of
1940) on any of the Funds listed on Schedule 1.3A.
.
7.7 Registration of UAM Stock.
(a) Registration Procedures and Expenses. UAM
shall use its
reasonable best efforts to effect the registration under the
Securities Act of the UAM
Stock for sale as of the Closing and the Contingent Stock as of
the Contingent Closing
by performing the following:
(i) UAM shall prepare and file with the Securities and
Exchange Commission
(the "Commission") registration statements with
respect to the UAM Stock
and the Contingent Stock and use its reasonable best
efforts to cause such
registration statement to become and remain effective
for a period of three
years from the Closing Date and the Contingent
Closing Date, respectively,
and shall comply with all applicable state securities
laws with respect
hereto. The Stockholders' plan of distribution with
respect to the UAM
Stock and the Contingent Stock shall be as follows:
(a) sale of shares from
time to time by the Selling Stockholders or by
pledgees, donees, transferees
or other successors in interest, (b) a block trade in
which the broker or
dealer so engaged will attempt to sell the shares as
agent but may position
and resell a portion of the block as principal to
facilitate the transaction, (c)
purchases by a broker or dealer as principal and
resale by such broker or
dealer for its own account, (d) regular brokerage
transactions executed on
the New York Stock Exchange, (e) negotiated
transactions effected at such
prices as may be obtainable and as may be
satisfactory to the Selling
Shareholder, or (f) other means. If the Securities
Act and/or the rules and
regulations promulgated by the Securities and
Exchange Commission
thereunder require that such Registration Statement
or the Prospectus
forming a part thereof be amended or supplemented in
order to properly
reflect the Stockholders' plan of distribution, the
Stockholders will promptly
notify UAM of such matters and cooperate with UAM in
effecting such
amendment or supplement.
(ii) UAM shall prepare and file with the Commission such
amendments and
supplements to such registration statements and the
prospectuses used in
connection therewith as may be necessary to update
and keep such
registration statements effective and to comply with
the provisions of the
Securities Act with respect to the sale of all
securities covered by such
registration statements. Notwithstanding anything
else to the contrary
contained herein, UAM shall not be required to
disclose any confidential
information concerning pending acquisitions not
otherwise required to be
disclosed.
(iii) UAM shall furnish to each Stockholder such number of
copies of the final
prospectus as such Stockholder may reasonably request
in order to facilitate
the sale of the UAM Stock owned by such Stockholder.
The Stockholders
shall comply with all prospectus delivery
requirements under the Securities
Act.
All expenses incurred by UAM in complying with this subsection
(a), including, without
limitation, all registration and filing fees (both federal and
state), printing expenses, and
fees and disbursements of counsel for UAM, are herein called
Registration Expenses. All
selling commissions applicable to the sales of UAM Stock and all
fees and disbursements
of counsel for any Stockholder are herein called Selling
Expenses.
(b) Allocation of Expenses. UAM will pay all
Registration Expenses in
connection with registration pursuant to this Section 7.7. All
Selling Expenses in
connection with such registration shall be borne by the
Stockholders.
(c) Indemnification. In connection with the
registration of UAM Stock
and Contingent Stock under the Securities Act pursuant to this
Section 7.7, UAM will
indemnify and hold harmless the seller of such UAM Stock and
Contingent Stock, each
underwriter of such UAM Stock and Contingent Stock and each other
person, if any, who
controls such seller or underwriter within the meaning of Section
15 of the Securities Act,
against any losses, claims, damages, liabilities or expenses,
joint or several, to which
such seller, underwriter or controlling person may become subject
under the Securities
Act or otherwise, insofar as such losses, claims, damages,
liabilities or expenses (or
actions in respect thereof) arise out of or are based upon (i)
any untrue statement of a
material fact contained in any registration statement under which
such UAM Stock and
Contingent Stock was registered under the Securities Act pursuant
to this Section 7.7, or
any post-effective amendment thereof, or the omission (or alleged
omission) to state
therein a material fact required to be stated therein or
necessary to make the statements
therein not misleading or (ii) any untrue statement of a material
fact contained in any
final prospectus (as amended or supplemented, if UAM shall have
filed with the
Commission any amendment thereof or supplement thereto), or the
omission (or alleged
omission) to state therein a material fact required to be stated
therein or necessary in
order to make the statements therein not misleading; and will
reimburse such seller,
underwriter and each such controlling person for any legal or
other expenses reasonably
incurred by such seller, underwriter or such controlling person
in connection with
investigating or defending any such loss, claim, damage,
liability or expense, provided,
however, that UAM will not be liable in any such case to the
extent that any such loss,
claim, damage, liability or expense arises out of or is based
upon any untrue statement or
omission (or alleged omission) of a material fact made in said
registration statement, said
preliminary prospectus, or said prospectus or said amendment or
supplement in reliance
upon and in conformity with written information furnished to UAM
through an instrument
duly executed by such seller or underwriter specifically for use
in the preparation thereof.
In connection with the registration of the UAM Stock and
Contingent Stock under
the Securities Act pursuant to this Section 7.7, each seller of
such UAM Stock and
Contingent Stock severally and not jointly, will indemnify and
hold harmless UAM, each
person, if any, who controls UAM within the meaning of Section 15
of the Securities
Act, each officer of UAM who signs the registration statement,
each director of UAM,
each underwriter, and each person who controls any underwriter
within the meaning of
Section 15 of the Securities Act, against any losses, claims,
damages, liabilities or
expenses, joint or several, to which UAM or such officer,
director, underwriter or
controlling person may become subject under the Securities Act or
otherwise, and will
reimburse UAM or such officer, director, underwriter or
controlling person for any legal
or other expenses reasonably incurred by UAM or such officer,
director, underwriter or
controlling person in connection with investigating or defending
any such loss, claim,
damage, liability or expense, but only insofar as such losses,
claims, damages, liabilities
or expenses (or actions in respect thereof) arise out of or are
based upon any untrue
statement or omission (or alleged omission) of a material fact
referred to in clause (i) or
(ii) of the preceding paragraph of this subsection (c), and
provided, however, that this
paragraph shall apply if and only if such statement or omission
(or alleged omission) was
made in reliance upon and in conformity with information
furnished in writing to UAM
by or on behalf of such seller specifically for use in such
registration statement or
prospectus.
It shall be a condition of UAM's obligations to effect
registration of the UAM
Stock and Contingent Stock that the sellers participating in such
registration provide
UAM and the underwriters, if any, with all material facts,
including, without limitation,
furnishing such certificates, questionnaires and legal opinions
as may be required by
UAM or such underwriters, concerning such participating sellers
and the UAM Stock and
Contingent Stock to be registered which are reasonably required
to be stated in the
registration statement or in the prospectus or are otherwise
required in connection with
the offering.
Article VIII.Conduct of PIC's Business Prior to the Closing Date.
PIC and the Stockholders agree that, from the date hereof
to the Closing Date,
except as set forth on Schedule 8 or as otherwise consented to or
approved by UAM in
writing or required by this Agreement:
(a) No change shall be made in the Articles of
Incorporation or the By-
laws of PIC.
(b) No change shall be made in the number of shares
of authorized or
issued capital stock of PIC, nor shall any option, warrant, call,
commitment, right or
agreement of any character be granted or made by PIC relating to
its authorized or issued
capital stock. No transfers in the ownership of shares of PIC
owned by the Stockholders
shall occur, other than by operation of law or pursuant to the
laws of descent and
distribution.
(c) No dividend shall be declared or paid or other
distribution or
payment declared, made or paid in respect of the capital stock of
PIC either in cash or
property.
(d) Except for increases in the compensation set
forth on Schedule 8(d),
and subject to the requirements of Section 9.15 on working
capital, no increase shall be
made in the rate of compensation payable or to become payable by
PIC to any director,
officer, employee or agent, and no bonus shall be paid to such
persons; no person shall
be elected an officer of PIC and no change shall be made in the
office of any officer of
PIC or the responsibility of any such officer except as
occasioned by the death,
resignation or disablement of any officer; and no collective
bargaining agreement, bonus,
stock option, profit-sharing, compensation, pension, welfare,
retirement or other similar
arrangement, or employment contract shall be entered into or
materially changed by PIC,
other than as may be required by law.
(e) No funds shall be borrowed or loaned by PIC,
except in the ordinary
course of business and not exceeding $100,000 in the aggregate up
to the Closing.
(f) No capital expenditure (other than for ordinary
repairs and
maintenance) shall be incurred or contracted for and no
litigation shall be settled by PIC
without prior consultation with UAM, and no such capital
expenditure or settlement in
excess of $100,000 shall be made without UAM's consent.
(g) PIC shall conduct its business in the ordinary
course. It shall meet
all of its obligations as they become due, and shall use its best
efforts to continue to
solicit new clients and to offer investment advisory services in
the ordinary course of
business, to maintain its corporate records, to keep its accounts
receivable current, to
preserve the business organization and properties of PIC intact,
to keep available the
services of PIC's employees, and to preserve the goodwill of
PIC's clients, suppliers, and
others with whom business relationships exist. PIC shall not
unilaterally change its fee
schedule which was in effect on September 30, 1994.
(h) PIC and the Stockholders shall afford to UAM
and its representatives
reasonable access to the properties and records of PIC during
customary business hours in
order that UAM may have full opportunity to make such
investigation as it shall desire of
PIC's affairs for purposes consistent with this Agreement. UAM
will cause all
information so obtained which is not in the public domain to be
held confidential, and
will cause all documents obtained during such investigation to be
returned promptly to
PIC in the event of the termination of this Agreement, provided,
however, that prior to
the Closing UAM may require that the proxy statements furnished
to the shareholders of
the Funds pursuant to Section 7.4 include all information which
UAM determines to be
required or appropriate under applicable law.
(i) PIC shall pay or fund all expenses and
liabilities incurred by it with
respect to all periods prior to the Closing, including without
limitation all salaries and
rents, and, without limiting the foregoing, shall pay or fund all
tax liabilities relating to
periods ending on or before the Closing, regardless of when such
expenses and liabilities
would ordinarily be payable, except for taxes on so-called
built-in gain which shall be
funded with the consideration received hereunder. PIC shall pay
or fund any liabilities or
amounts due to its employees as bonuses, profit-sharing or
pensions, calculated in
accordance with PIC's past practices, with respect to the fiscal
year ending December 31,
1994 and subject to the provisions of Section 9.15 (Working
Capital) below and the
Revenue Sharing Agreement, with respect to the period from that
date up to the Closing.
(j) All fees received by PIC up to the Closing Date
for services to be
rendered after the Closing Date shall be retained by Newco. Fees
to be received by
Newco after the Closing Date for services rendered prior to the
Closing shall be taken
into account in determining Working Capital in Section 9.15.
(k) PIC shall remain an S corporation at all times
prior to the Closing.
Article IX. Conditions Precedent to UAM's and Newco's
Obligations.
All obligations of UAM and Newco under this Agreement are
subject to the
fulfillment and satisfaction, prior to or at the Closing, of each
of the following conditions,
any one or more of which may be waived by UAM:
9.1 Delivery of Documents of Transfer. PIC shall have
delivered to UAM all
such documents of transfer, assignment or assumption as UAM or
its counsel may
reasonably require in order to consummate the purchase and sale
of Assets hereunder.
9.2 Employment Agreements. Robert M. Kommerstad shall
have executed an
Employment Agreement in the form attached hereto as Exhibit E-1,
each Stockholder
listed on the Addendum to Exhibit E-2 shall have executed an
Employment Agreement in
the form attached hereto as Exhibit E-2 duly completed in
accordance with the addendum
thereto, Thomas J. Condon shall have executed an Employment
Agreement in the form
attached hereto as Exhibit E-3, and each Stockholder listed on
the Addendum to Exhibit
E-4 shall have executed an Employment Agreement in the form
attached hereto as Exhibit
E-4 duly completed in accordance with the addendum thereto (the
"Employment
Agreements"). Each of the Employment Agreements shall have been
executed and
delivered as between each of such signatories and Newco, with
copies to UAM. All of
the employment agreements executed on the date hereof and
effective as of the Closing
attached hereto as Exhibit E-5 shall be in full force and effect.
There shall be no
material breach by the respective employees of any of such
employment agreements at the
Closing Date.
9.3 Representations and Warranties True at the Closing
Date. The
representations and warranties of PIC and the Stockholders
contained in this Agreement
shall be true in all material respects at and as of the Closing
Date as though newly made
at and as of that time. PIC and the Stockholders shall have
delivered to UAM a
certificate in the form of Exhibit L hereto, dated as of the
Closing Date and signed by a
duly authorized officer of PIC and the Stockholders, certifying
as to the truth and
accuracy of the representations and warranties and the
performance of the obligations
required to be performed by PIC and the Stockholders, or any of
them, under this
Agreement.
9.4 PIC's and Stockholders' Certificate. PIC and the
Stockholders shall have
delivered a certificate, dated as of the date of the Closing, in
the form of Exhibit M
hereto, certifying that since the delivery of PIC's Articles of
Organization and By-laws
pursuant to Section 3.2 above, there have been no amendments or
other modifications
thereof; that true, complete and accurate copies of the minutes
of meetings of the Board
of Directors and Stockholders (or consents in lieu thereof) have
been delivered to UAM;
that attached to the certificate are true and complete copies of
a resolution of PIC's Board
of Directors and Stockholders authorizing the transactions
contemplated hereby; and that
the officers of PIC are those persons named in the certificate.
9.5 Clients' Consents. The Adjustment Percentage, as
defined in Section 1.3,
above, shall be at least 70 per cent; and PIC shall have complied
with the notification
procedures set forth in Section 7.1, above. In addition, PIC
shall have obtained executed
Clients' Consents in the form of Exhibit K hereto signed by
advisory clients who are
listed on Schedule 1.3A prepared as of September 30, 1994, and
whose pro forma
quarterly billings as of such date represent at least 70 per cent
of all pro forma quarterly
billings shown on such Schedule 1.3A as of such date.
At the Closing, PIC and the Stockholders shall deliver a
certificate in the form of
Exhibit N as to the matters set forth in the foregoing paragraph
and stating the amount of
the Adjustment Percentage. Such certificate shall, in addition,
set forth the response of
all clients which have not executed Clients' Consents, and
whether such clients have
stated to PIC, either orally or in writing, their intention of
remaining as advisory clients
of PIC, or their intention of terminating their investment
advisory relationship with PIC.
Such certificate shall also certify that no clients who have
executed Clients' Consents
have revoked such Consents or disclosed to PIC an intention to do
so or to terminate their
investment advisory relationship with PIC or materially to reduce
their assets under
management by PIC.
9.6 Approvals. Any consent, approval, authorization or
order of any court,
governmental agency, administrative body or other person or
entity (including without
limitation consents of lessors of any property leased by PIC)
required for the
consummation of the transactions contemplated by this Agreement
shall have been
obtained and shall be in effect on the Closing Date.
9.7 Opinion of Counsel for PIC and the Stockholders. PIC
and the
Stockholders shall have delivered to UAM opinions from Proskauer
Rose Goetz &
Mendelsohn of Los Angeles, California, and/or Heller, Ehrman,
White & McAuliffe of
San Francisco, California, counsel for PIC and the Stockholders,
that:
(i) PIC is a corporation validly existing and in good
standing under the laws
of the State of California, with full corporate power
and authority to own
its properties and assets and to conduct its business
as it is now conducted.
PIC has duly authorized 1,000,000 shares of common
stock ($1.00 par
value) with voting power, of which 166,020 shares are
validly issued, fully
paid, nonassessable, outstanding, entitled to vote,
and, except as set forth
on Schedule 1, owned of record and, to the knowledge
of such counsel,
beneficially by the Stockholders. There are no other
shares of stock of any
description authorized or outstanding of record, and,
in the corporate
minute books of PIC made available to such counsel
there is no evidence of
the existence of any options, warrants, or rights to
purchase of any kind
affecting the stock of PIC which may require PIC to
issue additional stock,
nor does such counsel have actual knowledge of the
existence of any such
options, warrants or rights.
(ii) Except as disclosed in the Agreement or any Exhibit
or Schedule annexed
hereto, the execution and delivery by PIC and the
Stockholders of the
Agreement and the Related Agreements to which they
are parties and the
consummation by the Stockholders and PIC of the
transactions contemplated
therein do not conflict with and do not violate any
provision of the State of
California or federal law or of the Articles of
Incorporation or By-laws of
PIC or result in a violation or default in any
provision of any regulation,
order, writ, injunction or decree known to such
counsel of any court or
governmental agency or authority, or, to the best of
such counsel's
knowledge after due inquiry (and assuming all
consents contemplated by
Section 7 have been received), any provision of any
agreement listed on the
Schedules attached hereto, to which PIC or any of the
Stockholders is a
party or by which PIC or any of the Stockholders is
bound or to which PIC
or any of the Stockholders or any of their shares of
PIC Stock is subject, or
to the best of such counsel's knowledge after due
inquiry, result in the
creation or imposition of any lien, charge,
encumbrance or security interest
upon any of the properties owned by PIC.
(iii) The Stockholders have duly executed and delivered the
Agreement and the
Related Agreements to which they are parties. The
Agreement and such
Related Agreements are the valid and binding
obligations of the
Stockholders, enforceable in accordance with their
respective terms, subject
to the Remedies Exception.
(iv) To such counsel's knowledge, there is no claim,
litigation, proceeding or
governmental investigation pending or threatened
against PIC or any of its
directors, officers, employees or Stockholders
affecting the transaction
contemplated by the Agreement or affecting the
property or assets of PIC.
(v) No authorization, approval, order, license, permit,
franchise or consent of
or registration, declaration or filing with any
California or United States
governmental authority is required in connection with
the execution,
delivery or performance of the Agreement which has
not been obtained,
other than a withdrawal of PIC's Form ADV and
corresponding state
forms, if such have not been filed with the
Securities and Exchange
Commission and the appropriate states prior to the
Closing.
(vi) The execution, delivery and performance by PIC of
this Agreement has
been duly authorized and approved by all requisite
action of PIC's Board of
Directors and Stockholders. This Agreement has been
duly executed and
delivered by PIC and constitutes the legal, valid and
binding obligations of
PIC, enforceable in accordance with its terms,
subject to the Remedies
Exception.
(vii) To counsel's knowledge, PIC is duly registered as an
investment adviser
under the Investment Advisers Act of 1940, registered
as an investment
adviser in the states referenced in item 7, Part I of
its current Form ADV,
and in material compliance with all state laws
requiring registration,
licensing or qualification as an investment adviser;
and each such federal
and state registration is in full force and effect,
in each case such that no
materially adverse change in the financial condition
or business of PIC
would result. PIC is not an "investment company"
(within the meaning of
the Investment Company Act of 1940), which is
required to be registered
under that Act in order to engage in the transactions
described in Section 7
of that Act, is not a "broker" or "dealer" within the
meaning of the
Securities Exchange Act of 1934, and does not act as
an investment adviser
or subadviser to any "investment company" (as defined
in the Investment
Company Act of 1940), which is registered under such
Act other than the
Funds. To counsel's knowledge after due inquiry,
there is not pending or
under way any inspection of PIC or its records by the
Securities and
Exchange Commission or any state regulatory
authority, and counsel does
not have knowledge of any inspection reports or
similar documents
furnished to PIC by the Securities and Exchange
Commission or state
regulatory authorities since January 1, 1989, that
have not been listed on
Schedule 3.25.
(viii)To the best of such counsel's knowledge after due
inquiry, (x) PIC has
timely filed an election to be treated as an S
Corproation governed by the
provisions of Subchapter S of the Code for the
taxable year beginning
January 1, 1989, and ending December 31, 1989, and
(y) since such filing
all of the following have remained true through the
Closing:
(I) PIC has not had more than 35 shareholders;
(II) PIC has not had as a shareholder any
non-resident alien;
(III) PIC has not had as a shareholder a person
(other than a trust
described in Section 1361(c)(2) of the Code) who is
not an individual; and
(IV) PIC's Articles and By-laws, as amended, and its
other governing
provisions known to such counsel, do not provide for
or purport to create
more than one class of stock.
In rendering the foregoing opinions, such counsel may assume that
the relevant
substantive and procedural law of the State of Massachusetts is
identical to the law of the
State of California, and further, such counsel need express no
opinion with respect to (i)
any indemnification obligation to the extent it may be contrary
to public policy, (ii) any
non-competition or confidentiality obligation, or (iii) any
choice of law or jurisdiction
provision. Proskauer Rose Goetz & Mendelsohn shall not be
required to opine as to
matters relating to the federal or state regulation of investment
advisors or investment
companies, including but not limited to the Investment Advisers
Act of 1940, as
amended, or the Investment Company Act of 1940, as amended.
9.8 PIC's and the Stockholders' Performance. Each of the
obligations of PIC
and/or the Stockholders to be performed on or before the Closing
Date pursuant to the
terms of this Agreement shall have been duly performed on or
before the Closing Date.
9.9 Payments Made. All payments required by paragraph
(i) of Article VIII of
this Agreement shall have been made or adequately funded and UAM
shall have received
a certificate to that effect, dated as of the Closing Date and
signed by PIC and the
Stockholders, in the form of Exhibit O hereto.
9.10 Conduct of PIC's Business Prior to the Closing Date.
PIC's business shall
have been conducted in accordance with the provisions of Article
VIII and Schedule 8
hereto.
9.11 Certificate Relating to Real Property Interests. The
Stockholders shall have
executed a certificate in the form of Exhibit P hereto relating
to foreign ownership of real
estate interests in the United States.
9.12 Approval of Documentation. The form and substance of
all opinions,
certificates, and other documents shall be reasonably
satisfactory in all respects to UAM
and its counsel.
9.13 Examination of Books And Records. For purposes of
compliance with and
performance of this Agreement, UAM, acting through its own
management and personnel
or through counsel, accountants, or other representatives
designated by it, shall have been
afforded full and complete opportunity to examine and investigate
all aspects of PIC's
business and affairs and assets and liabilities, including
without limitation, its minute
books and stock transfer records, financial books and records,
the workpapers of PIC's
independent public accountants, the Investment Advisory
Contracts, titles and leases to
properties, loan and other agreements, the condition of its
facilities and equipment, and
the collectibility of accounts receivable. UAM shall also have
been afforded the
opportunity to confer with PIC's advisory clients in the presence
of a representative of
PIC (in such manner, at such times, and with such frequency, as
may be reasonably
required by UAM).
9.14 Advisers Act Registration. Registration of Newco as
an investment adviser
and withdrawal of the registration of PIC as an investment
adviser under the Investment
Advisers Act of 1940 and under applicable state investment
advisory statutes shall have
been filed and become effective as contemplated by Article VII,
if so requested by UAM.
9.15 Working Capital. At the Closing Date, PIC's cash,
liquid marketable
securities, and accounts receivable which are collectible or
realizable within a normal
billing cycle for PIC ("Working Capital") and which will be
transferred to Newco will be
sufficient to fund: (1) accounts payable and accrued expenses,
including income, excise
and business and occupation taxes and bonuses which would be
accrued in accordance
with generally accepted accounting principles as of the Closing
Date and which are to be
paid by Newco; (2) any deferred revenues which will have been
billed in advance by the
Closing Date but not yet earned; (3) normal compensation and
other operating expenses,
including all accrued employee compensation and other accrued
items; and (4) an amount
equal to a pro rata share of projected bonuses and other
incentive compensation under the
Revenue Sharing Agreement, which would be incurred between the
Closing Date and the
point in time that the next full cycle of fee billings are
collected and all accrued "Stock
Pickers Bonuses", so that after the Closing, Newco is
sufficiently capitalized with liquid
current assets to operate on a freestanding basis without
investment of cash in Newco by
UAM for the reasonably foreseeable future. Fees earned by Newco
following the
Closing will be realizable in cash so that all future operating
expenses of Newco can be
met without investment of cash in Newco by UAM and UAM's Share of
Revenues can be
paid to UAM promptly after the collection of fees by Newco.
9.16 Health. Each person listed on Schedule 3.28 shall be
in good physical
health.
9.17 Life Insurance. Life insurance policies on the lives
of the Stockholders
listed in Schedule 9.17 shall have been obtained by UAM or Newco,
as UAM shall
require, at UAM's sole expense.
9.18 Form 8-K. PIC and the Stockholders shall have
provided such records,
including without limitation the work papers of its bookkeepers
and accountants, as may
be required by UAM in connection with UAM's obligation, if any,
to file a report of its
acquisition of the business and assets of PIC hereunder with the
Securities and Exchange
Commission on Form 8-K and, in the sole judgment of UAM, UAM
shall be in a
position timely to file such report.
9.19 Hart-Scott-Rodino Filing. The provisions of the
"Hart-Scott-Rodino Act"
shall have been complied with to the satisfaction of UAM or, in
UAM's judgment, an
exemption from the requirements of such section shall be
available for the transactions
contemplated by this Agreement.
9.20 Exchange Listing. The New York Stock Exchange shall
have notified
UAM that the Exchange has approved UAM's application to list upon
official notice of
issuance the shares of UAM Common Stock issuable in connection
with this Agreement.
Article X. Conditions Precedent to PIC's and the Stockholders'
Obligations.
All obligations of PIC and the Stockholders under this
Agreement are subject to
the fulfillment and satisfaction, prior to or on the Closing
Date, of each of the following
conditions, any one or more of which may be waived by PIC and the
Stockholders:
10.1 Opinion of UAM's and Newco's Counsel. UAM shall have
furnished to
the Stockholders an opinion dated as of the Closing Date of Hill
& Barlow, of Boston,
Massachusetts, counsel to UAM and Newco, that:
(i) UAM is a corporation validly existing and in good
standing under the laws
of the State of Delaware. UAM has duly authorized
50,000,000 shares of
Common Stock, $.01 par value, of which 28,283,082
shares were validly
issued and outstanding and 11,808,146 shares were
reserved for issuance on
exercise of outstanding warrants or options or upon
conversion of
outstanding convertible notes, or otherwise, as of
November 1, 1994.
UAM also has authorized 5,000,000 shares of Preferred
Stock, $1.00 par
value, none of which is outstanding. Newco is a
corporation validly
existing and in good standing under the laws of the
Commonwealth of
Massachusetts. Newco has authorized 100 shares of
Common Stock, no
par value, of which 100 shares are validly issued,
fully paid and
nonassessable and are owned of record by United Asset
Management
Holdings, Inc.
(ii) This Agreement and the Related Agreements to which
UAM and Newco are
parties have been duly authorized, executed and
delivered by UAM and
Newco and constitute the valid and binding
obligations of UAM and
Newco, enforceable in accordance with their
respective terms, subject to
the Remedies Exception.
(iii) The execution and delivery by UAM and Newco of this
Agreement and the
Related Agreements to which they are parties and the
consummation of the
transactions contemplated hereby and thereby do not
conflict with or violate
any provision of law or of the respective Certificate
or Articles of
Incorporation or By-laws of UAM or Newco or result in
a violation or
default in any provision of any regulation, order,
writ, injunction or decree
of any court or governmental agency or authority, or
any provision of any
agreement known to such counsel after due inquiry, to
which UAM or
Newco is a party or by which UAM or Newco is bound or
to which UAM
or Newco is subject, or result in the creation or
imposition of any lien,
charge, encumbrance or security interest upon any of
the properties owned
by UAM or Newco pursuant to the terms of any such
agreement (other than
a security interest of UAM's lending banks in the
stock of Newco).
(iv) UAM has reserved by all necessary corporate action
the required number of
shares of its Common Stock for issuance upon exercise
of the Warrant and
the Contingent Warrant. The Common Stock issuable
upon exercise of the
Warrant and the Contingent Warrant has been duly
authorized by all
necessary corporate action and when issued in
accordance with the Warrant
Agreement and delivered by UAM, will be validly
issued and outstanding,
fully paid and non-assessable.
(v) The issuance of shares of UAM Common Stock pursuant
to the terms
hereof have been duly authorized by all necessary
corporate action and,
when issued as contemplated by this Agreement, will
be validly issued,
fully paid and nonassessable.
(vi) The registration of Newco as an investment adviser
under the Investment
Advisers Act of 1940 has been filed and become
effective as contemplated
by Article VII.
10.2 Representations and Warranties True at the Closing
Date. Except as
expressly contemplated by this Agreement, the representations and
warranties of UAM
and Newco contained in this Agreement shall be true in all
material respects at and as of
the Closing Date as though newly made at and as of that time.
UAM and Newco shall
have delivered to PIC and the Stockholders a certificate in the
form of Exhibit Q hereto,
dated as of the Closing Date and signed by a duly authorized
officer of UAM and
Newco, certifying as to the truth and accuracy of the
representations and warranties and
the performance of all of the obligations required to be
performed by UAM and Newco,
or either of them, under this Agreement.
10.3 Performance of UAM and Newco. Each of the
obligations of UAM or
Newco to be performed on or before the Closing Date pursuant to
the terms of this
Agreement shall have been duly performed in all material respects
at the Closing Date.
10.4 Authority of UAM and Newco. All corporate action
required to be taken
by or on the part of UAM or Newco to authorize the execution,
delivery and
performance of this Agreement by UAM and Newco and the
consummation of the
transactions contemplated hereunder shall have been duly and
validly taken.
10.5 Approval of Documentation. The form and substance of
all opinions,
certificates and other documents hereunder shall be reasonably
satisfactory in all respects
to PIC and the Stockholders and their counsel.
10.6 Revenue Sharing Agreement. UAM and Newco shall have
executed and
delivered to the Stockholders the Revenue Sharing Agreement
attached hereto as Exhibit
F.
10.7 Adjustment Percentage. The Adjustment Percentage, as
defined in Section
1.3 above, shall be 70 per cent or greater.
10.8 Employment Agreements. Newco shall have executed and
delivered to the
Stockholders the Employment Agreements attached hereto as
Exhibits E-1, E-2, E-3 and
E-4. There shall be no material breach by Newco of any of the
Employment Agreements
at the Closing Date.
10.9 Advisers Act Registration. Registration of Newco as
an investment adviser
and withdrawal of the registration of PIC as an investment
adviser under the Investment
Advisers Act of 1940 and under applicable state investment
advisory statutes shall have
been filed and become effective as contemplated by Article VII,
if so requested by UAM.
10.10 Assumption Agreement. UAM and Newco shall have
executed and
delivered to PIC and the Stockholders an Assumption Agreement in
a form reasonably
satisfactory to PIC's counsel.
10.11 NYSE Listing. UAM shall have delivered to PIC and
the Stockholders a
copy of an approval by the New York Stock Exchange of a listing
application covering
the UAM Stock and the Contingent Stock.
10.12 Incentive Stock Options. The Compensation Committee
of UAM's Board
of Directors shall have approved the issuance (upon the Closing)
of incentive stock
options (within the meaning of Section 422(b) of the Code) under
UAM's 1994 Stock
Option Plan with respect to an aggregate of 150,000 shares of
UAM's Common Stock
(but subject to the limitation imposed on incentive stock options
under Section 422(d) of
the Code) to be awarded to employees of Newco as soon as
practicable following the
Closing Date with an exercise price equal to the market value of
UAM's Common Stock
on the date of grant.
Article XI. Post-Closing Covenants.
11.1 Non-Competition. (a) Robert M. Kommerstad covenants
that during the
longer of five years following the date hereof or while he is
employed by Newco or
UAM, each Stockholder listed on the Addendum to Exhibit E-2
covenants that during the
longer of ten years following the date hereof or while such
Stockholder is employed by
Newco or UAM, Thomas J. Condon covenants that during the longer
of seven years
following the date hereof or while he is employed by Newco or
UAM, and each
Stockholder listed on the Addendum to Exhibit E-4 covenants that
during the longer of
seven years following the date hereof or while such Stockholder
is employed by Newco
or UAM, whether under a written employment agreement or as an at
will employee, such
Stockholder shall not, except in the course of such Stockholder's
employment with
Newco or UAM, directly or indirectly:
(i) Provide or offer or attempt to provide, whether as an
officer, director,
employee, partner, stockholder, consultant, adviser,
subsidiary, affiliate,
independent contractor or otherwise, investment
advisory services to any
person or entity;
(ii) Interfere with Newco's relations with any person or
entity who at any time
during such period was a Client (which means Past,
Present and Potential
Client); or
(iii) Induce or attempt to induce directly or indirectly
any employee of UAM or
Newco to terminate his or her employment, or hire or
attempt to hire,
directly or indirectly, any such person.
(b) Each Stockholder covenants that for a period of
the longer of five
years following the Term of such Stockholder's Employment
Agreement or five years
following the termination of such Stockholder's employment, if
any, with Newco or
UAM such Stockholder shall not, directly or indirectly:
(i) Provide or offer or attempt to provide, whether as an
officer, director,
employee, partner, independent contractor or
otherwise, investment
advisory services to any person or entity who as of
the date of the
termination or expiration of the Stockholder's
employment with Newco or
UAM was or had been a Client (which means Past,
Present, and Potential
Client);
(ii) Interfere with Newco's relations with any person or
entity who as of the
date of the termination or expiration of the
Stockholder's employment with
Newco was a Client (which means Past, Present, and
Potential Client); or
(iii) Induce or attempt to induce directly or indirectly
any employee of Newco to
terminate his or her employment, or hire or attempt
to hire, directly or
indirectly, any such person.
(c) The term "Past Client" shall mean at any
particular time any person
or entity who at any point prior to such time has been but at
such time is not an advisee,
investment advisory customer, or client of PIC or Newco. The
term "Present Client"
shall mean at any particular time any person or entity who is at
such time an advisee, an
investment advisory customer, or client of PIC or Newco. The
term "Potential Client"
shall mean at any particular time any person or entity to whom
PIC or Newco, through
any of its officers or employees, has within five years prior to
such time offered (by
means of a personal meeting, telephone call, or a letter or a
written proposal specifically
directed to the particular person or entity) to serve as
investment advisor but who is not
at such time an advisee or investment advisory customer or client
of Newco. The
preceding sentence is meant to exclude form letters and blanket
mailings. The term
"Client" when used herein shall include all past, present and
potential clients as
heretofore defined. The term "Client," when used in this Section
11.1 with respect to
Wrap Accounts, shall mean the Wrap Sponsors and the brokers
employed by such Wrap
Sponsors but not the underlying Wrap Account holders.
(d) Notwithstanding the provisions of Subsections
11.1(a)(i) and
11.1(b)(i), a Stockholder may render investment advisory services
without compensation
to any Stockholder, any member of the immediate family of any of
the Stockholders and
any trust or account which is comprised entirely of assets held
for the benefit of any
Stockholder and/or members of such Stockholder's immediate
family.
(e) Each Stockholder agrees that the periods of
time and the unlimited
geographic area applicable to the covenants of this Section 11
are reasonable, in view of
the payment of the Purchase Price hereunder, the geographic scope
and nature of the
business in which PIC is engaged and Newco will be engaged, the
Stockholder's
knowledge of PIC's and Newco's business, and each Stockholder's
relationship with
PIC's and Newco's clients. However, if such period or such area
should be adjudged
unreasonable in any judicial proceeding, then the period of time
shall be reduced by such
number of months or such area shall be reduced by elimination of
such portion of such
area, or both, as are deemed unreasonable, so that this covenant
may be enforced in such
area and during such period of time as are adjudged to be
reasonable.
11.2 Confidentiality. Except in performance of services
for Newco or as
permitted in Section 11.1(d), the Stockholders shall not, either
during the period of their
employment with Newco or thereafter, use for his own benefit or
disclose to or use for
the benefit of any person outside Newco, any information not
already lawfully available
to the public or to any person outside Newco (provided that such
person is not bound by
a confidentiality agreement or other legal or fiduciary
obligation of secrecy with respect
to such information) concerning any Intellectual Property (as
defined below), including
client lists, whether such Stockholder has such information in
his memory or embodied in
writing or other tangible form. All such Intellectual Property
and such information
concerning Intellectual Property, and all originals and copies of
any Intellectual Property,
and any other written material relating to the business of Newco,
shall be the sole
property of Newco. Upon the termination of any Stockholder's
employment by Newco in
any manner or for any reason, such terminated Stockholder shall
promptly surrender to
Newco all originals and copies of any Intellectual Property, and
he shall not thereafter
use any Intellectual Property. For purposes hereof, the term
Intellectual Property shall
mean all research, information, client lists, and all other
investment advisory, technical
and research data made, conceived, developed and/or acquired by a
Stockholder solely or
jointly with others during the period of employment by PIC or
Newco, which related to
investment advice as it was or is now rendered or as it may, from
time to time, hereafter
be rendered or proposed to be rendered, but excluding such
individual's ideas and thought
processes which are not embodied in written or machine readable
form.
11.3 Further Assurances. From time to time after the
Closing at the request of
UAM and without further consideration, the Stockholders and/or
PIC shall execute and
deliver any further instruments and take such other action as UAM
may reasonably
require to consummate the transactions contemplated hereby. To
the extent that the
transactions contemplated hereby require the consent of any
person in order to avoid a
breach of the terms of any lease, contract or commitment to which
PIC is a party or by
which PIC is bound, or in order to vest PIC's rights in Newco,
and such consent is not
obtained satisfactorily prior to the Closing, the Stockholders
shall use their best efforts to
assure Newco of the benefits of such leases, contracts,
commitments and rights. Nothing
in this section shall be deemed a waiver by UAM or Newco of their
rights under Article
IX of this Agreement.
11.4 Amendment to Registrations and Filing of Form 8-K.
PIC and the
Stockholders shall cooperate with UAM and Newco to file Form 8-K
with the Securities
and Exchange Commission relating to the transactions contemplated
hereby. UAM shall
reimburse PIC and/or the Stockholders, as the case may be, for 50
per cent of the amount
of any out-of-pocket fees and expenses paid by such parties in
order to comply with the
requirements of the preceding sentence. PIC and the Stockholders
shall cooperate with
UAM and Newco to file, if not filed prior to the Closing Date,
all registrations and
amendments to registration or withdrawals of registration under
federal and state laws
requiring registration of investment advisers on behalf of Newco
and/or PIC and
documents relating to the qualification of Newco to do business
in states other than
Delaware.
11.5 Compliance with Hart-Scott-Rodino Act. PIC and each
Stockholder
covenant that from and after the Closing each shall comply with
any applicable provisions
of the Hart-Scott-Rodino Act in connection with the transactions
contemplated hereby.
11.6 Additional Covenants. PIC, the Stockholders and
Newco shall maintain in
good condition all presently existing files, books, records and
documents of PIC, and
shall make the same available to each other or their designees
upon request, for the
periods of time and in the locations required by the Investment
Advisers Act of 1940 and
the regulations promulgated thereunder, including without
limitation regulation
Sec. 275.204-2.
After the Closing, the parties shall cooperate to comply
with Sections 15(f) and
16(b) of the Investment Company Act of 1940 as they apply to the
Funds listed on
Schedule 1.3A as of the Closing and generally to comply with the
Investment Company
Act of 1940 and the Investment Advisers Act of 1940 as they apply
to Newco, PIC,
UAM and the clients of PIC.
11.7 Use of Name "Provident Investment Counsel" The
parties hereto shall
cooperate to change PIC's name to a name not confusingly similar
to "Provident
Investment Counsel" and to change Newco's name to "Provident
Investment Counsel,
Inc." effective as of the Closing Date. PIC and the Stockholders
acknowledge and agree
that UAM is acquiring the exclusive use of the name "Provident
Investment Counsel" for
which the Stockholders will receive full and adequate
compensation, and that none of the
Stockholders will use that name or any similar name subsequent to
the Closing except in
connection with activities performed for Newco.
11.8 Options. UAM shall recommend to the Compensation
Committee of its
Board of Directors that options be issued under UAM's Incentive
Stock Option Plan with
respect to an aggregate of 150,000 shares of UAM's Common Stock
to be awarded to
employees of Newco as soon as practicable following the Closing
Date with an exercise
price equal to the market value of UAM's Common Stock on the date
of grant.
11.9 Statutory Compliance. For a period of three years
following the Closing
Date, Newco and PIC agree that they will each use their best
efforts to ensure that (i) at
least 75 per cent of the members of the Board of Directors of
each Fund which (either
prior or subsequent to the Closing) has entered into a New Fund
Agreement will not be
"interested persons" (as such term is defined in the Investment
Company Act of 1940) of
UAM, Newco or PIC and (ii) nothing within their reasonable
control will cause the
imposition of an "unfair burden" (as such term is defined in
Section 15(f) of the
Investment Company Act of 1940) on any of the Funds listed on the
Original Schedule or
the Revised Schedule.
11.10 Extension Bonus Payment. Under the terms of Schedule
2 to the
Employment Agreements attached hereto as Exhibits E-4 and E-5,
Newco is obligated to
make bonus payments out of the Pool referred to therein. To the
extent that such Pool
exceeds the Operating Income Cap (as defined therein), UAM shall
contribute such
excess in cash to Newco as a capital contribution at such time as
the relevant bonus
payments are due to such employees.
11.11 UAM Capital Contribution. Immediately following the
Closing, UAM shall
contribute cash to Newco in the amount of $1,750,000 for the
purpose of funding the
payments due on the Closing Date to the employees under the
Employment Agreements
attached hereto as Exhibit E-5.
11.12 Employees; Employee Benefits.
(a) Newco shall offer employment to all employees
of PIC identified on
Schedule 3.16 . To the extent permitted under applicable law,
Newco's offer of
employment shall include employee benefits at least substantially
equivalent to those
applicable to each such employee immediately before the Closing
Date based on those
Benefit Plans described on Schedule 3.20 hereto; provided,
however, that Newco shall
have no obligation with respect to retirement benefits other than
to become a participating
employer in the United Asset Management Corporation Profit
Sharing and 401(k) Plan
(the "UAM 401(k) Plan"). Effective as of the Closing Date, all
such employees will
become employees of Newco ("Hired Employees").
(b) In any termination or layoff by Newco of any
Hired Employee after
the Closing, Newco will comply fully, if applicable, with the
Worker Adjustment and
Retraining Notification Act of 1988 ("WARN") and all other
applicable Federal, state and
local laws, including those prohibiting discrimination and
requiring notice.
(c) On the Closing Date, PIC shall transfer and
Newco shall assume and
will have responsibility for PIC's 401(k) Plan, and Newco will be
deemed a successor
employer to PIC with respect to such plan. Assets held in trust
for such plan shall be
transferred to any relevant plan adopted or maintained by Newco.
(d) As of the Closing Date, and without any waiting
period, Newco will
provide all Hired Employees (and their dependents) with medical
benefit coverage under
plans maintained or established by Newco, to the extent
reasonably available on a basis
comparable to the existing coverage and consistent with Newco's
obligations under this
Section 11.12. As to any Hired Employee (or a dependent thereof)
who was covered by
PIC's medical plans as of the Closing, to the extent permitted
under the coverage
provided pursuant to the preceding sentence, Newco will waive any
pre-existing condition
exclusions contained in the applicable medical plans and consider
any monies paid under
PIC's medical and dental plans by Hired Employees (or their
dependents) prior to the
Closing Date toward any deductibles, co-pays or other maximums
under Newco's medical
and dental plan for the first plan year after the Closing Date.
Newco will be responsible
for satisfying its obligations under Section 601 et seq. of ERISA
and Section 4980B of
the Internal Revenue Code of 1986, as amended (the "Code"), to
provide continuation
coverage ("COBRA") to any Hired Employee in accordance with law.
(e) As of the Closing Date, Newco will assume all
obligations of PIC to
Hired Employees for any vacation entitlement and vacation pay
entitlement, regardless of
whether such obligations have been accrued on the books of the
business. Newco shall
provide vacation benefits (including, without limitation,
vacation entitlement and vacation
pay entitlement) to Hired Employees in accordance herewith.
(f) Newco will provide each Hired Employee with
full credit for such
Hired Employee's service with PIC prior to the Closing for
purposes of any participation
or eligibility requirement and for purposes of vesting under the
UAM 401(k) Plan,, and
for purposes of any eligibility, participation, vesting or
similar requirement for retirees
medical (including, without limitation, dental), life insurance,
medial, severance pay,
incentive compensation and vacation benefits, if any. Newco
shall fully vest all
participants in the PIC 401(k) plan no later than thirty (30)
days after the Closing Date.
(g) Any liabilities, costs or expenses incurred by
PIC or Newco
associated with the termination by Newco of any Hired Employees,
shall be the
responsibility of Newco. Any liabilities, costs or expenses
incurred by PIC or Newco
associated with the termination by PIC of any PIC employees shall
be the responsibility
of PIC.
(h) Neither Newco nor PIC intend this Section 11.12
to create any rights
or interest, except as between Newco and PIC, and no present or
future employees of
either party (or any dependents of such employees) will be
treated as third party
beneficiaries in or under this Agreement.
(i) All costs and expenses incurred by Newco in
complying with the
terms of this Section 11.12 shall be paid out of Newco's Share of
Revenues under the
Revenue Sharing Agreement.
Article XII. General.
12.1 Entire Agreement. All Exhibits and Schedules hereto
shall be deemed to be
incorporated into and made part of this Agreement. This
Agreement, together with the
Exhibits and Schedules hereto, contains the entire agreement
among the parties and there
are no agreements, representations, or warranties by any of the
parties hereto which are
not set forth herein. This Agreement may not be amended or
revised except by a writing
signed by all parties hereto.
12.2 Equitable Relief; Binding Effect. The Stockholders
recognize and agree
that Newco's and UAM's remedy at law for any breach of the
provisions of Sections 11.1
and 11.2 hereof would be inadequate and that for breach of such
provisions Newco and
UAM shall, in addition to such other remedies as may be available
to them at law or in
equity or as provided in this Agreement, be entitled to
injunctive relief by an action for
specific performance to the extent permitted by law. This
Agreement shall be binding
upon and inure to the benefit of the parties hereto and their
respective successors and
assigns; provided, however, this Agreement and all rights
hereunder may not be assigned
by PIC or the Stockholders except by prior written consent of UAM
or assigned by UAM
or Newco except by prior written consent of PIC and the
Stockholders.
12.3 Separate Counterparts. This Agreement may be
executed in several
identical counterparts, all of which when taken together shall
constitute but one
instrument, and it shall not be necessary in any court of law to
introduce more than one
fully executed counterpart in proving this Agreement.
12.4 Consistent Accounting. The parties to this Agreement
shall consult with
each other for the purpose of arriving at consistent accounting,
tax and reporting
treatment, whether public or private, of the transaction
contemplated hereby.
12.5 Transaction Costs. Except as may be otherwise
expressly set forth herein,
each party to this Agreement shall be responsible for his, her or
its own legal, accounting
and other expenses, if any, attendant to the negotiation and
drafting of this Agreement
and to the transactions contemplated by this Agreement. Without
limiting the foregoing,
UAM shall be responsible for Newco's organizational and
qualification costs incurred
prior to the Closing.
12.6 Notices. All notices hereunder shall be in writing
and shall be delivered or
mailed by registered or certified mail, postage and fees prepaid,
to the party to be
notified at the party's address shown below. Notices which are
hand delivered shall be
effective on delivery. Notices which are mailed shall be
effective on the third day after
mailing.
(i) If to UAM or Newco:
United Asset Management Corporation
One International Place
Boston, Massachusetts 02110
Attn.: Norton H. Reamer
with a copy to:
John C. Vincent, Jr., Esq.
Hill & Barlow
One International Place
Boston, Massachusetts 02110
(ii) If to PIC or to all of the Stockholders:
Provident Investment Counsel, Inc.
300 North Lake Avenue
Pasadena, California 91101
Attn: Robert M. Kommerstad
with a copy to:
Mitchell M. Gaswirth, Esq.
Proskauer Rose Goetz & Mendelsohn
Suite 2700
2121 Avenue of the Stars
Los Angeles, CA 90067
(iii) If to a particular Stockholder, at such Stockholder's
address as shown on
Schedule I, hereto, with a copy to Mitchell Gaswirth
as stated above;
unless and until notice of another or different address shall be
given as provided herein.
12.7 Severability. The provisions of this Agreement are
severable and the
invalidity of any provision shall not affect the validity of any
other provision.
12.8 Captions. The captions herein have been inserted
solely for convenience of
reference and in no way define, limit or describe the scope or
substance of any provision
of this Agreement.
12.9 Due Inquiry. The term "due inquiry" as used
throughout this agreement
shall be deemed to mean, in the case of such inquiry by PIC's or
the Stockholder's
counsel, inquiry of appropriate officers and/or employees of PIC
and the Stockholders
only, and in the case of such inquiry by UAM's, or Newco's
counsel, inquiry of
appropriate officers and/or employees of UAM only.
12.10 Gender. All pronouns used herein shall include the
masculine, feminine
and neuter gender, as the context requires.
12.11 Governing Law. The execution, interpretation, and
performance of this
Agreement shall be governed by the laws of The Commonwealth of
Massachusetts which
apply to contracts executed and performed solely in
Massachusetts. The parties hereto
hereby consent to the jurisdiction of any state or federal court
located within Suffolk
County, Massachusetts, waive personal service of process, and
assent that service of
process may be made by registered mail to the parties' respective
addresses as provided
in Section 12.6, above, and shall be effective in the same manner
as notices are effective
under such Section 12.6.
12.12 No Third-Party Beneficiaries. The parties hereto
have entered into this
Agreement for their own benefit and do not intend to benefit any
other person or entity
thereby.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have duly executed
this Agreement
as a document under seal as of the date first above written.
UNITED ASSET MANAGEMENT
CORPORATION
By:
____________________________
Norton H. Reamer,
President
PIC NEWCO, INC.
By:
_____________________________
Franklin H. Kettle,
President
PROVIDENT INVESTMENT
COUNSEL
By:
______________________________
Robert M. Kommerstad
Chairman/President
<PAGE>
STOCKHOLDERS:
_____________________________
Robert M. Kommerstad
_____________________________
Jeffrey J. Miller
_____________________________
Thomas J. Condon
_____________________________
George E. Handtmann, III
_____________________________
Larry D. Tashjian
_____________________________
Lauro F. Guerra
_____________________________
F. Brown Windle
_____________________________
Thomas M. Mitchell
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