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EXHIBIT 2.1
ARISTA MARKETING ASSOCIATES, INC.
THE ▇▇▇▇▇▇ COMPANIES
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CONSOLIDATION AGREEMENT
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As of June 25, 1998
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TABLE OF CONTENTS
Page
1. Definitions..............................................................1
2. Basic Transactions.......................................................4
2.1. ▇▇▇▇▇▇ Companies..................................................4
2.2. ▇▇▇▇▇ Transfer Corp...............................................5
2.3. Consequences of Transactions......................................5
2.4. Effect of this Agreement..........................................5
2.5. The Closing.......................................................6
2.6. Actions at the Closing............................................6
2.7. Redomiciliation of Arista, etc....................................7
2.8. Issuance of Additional Shares to Curcura..........................7
3. Representations and Warranties of Arista and Curcura.....................8
3.1. Organization and Qualification....................................8
3.2. Subsidiaries......................................................8
3.3. Capitalization....................................................8
3.4. Agreement; Title to Shares........................................9
3.5. Financial Statements.............................................10
3.6. Title to Property, Absence of Encumbrances, etc..................11
3.7. Accounts Receivable and Accounts Payable.........................12
3.8. Books and Records................................................13
3.9. Patents, Trademarks, etc.........................................13
3.10. Employee Remuneration, etc.......................................14
3.11. Labor Matters....................................................15
3.12. Bank Accounts....................................................16
3.13. No Adverse Change................................................17
3.14. Absence of Certain Changes.......................................17
3.15. Litigation.......................................................20
3.16. Compliance with Other Instruments and Laws.......................20
3.17. Contracts, etc...................................................21
3.18. Taxes............................................................23
3.19. Permits..........................................................28
3.20. Employee Benefit Plans...........................................29
3.21. Insurance........................................................31
3.22. Transactions with Affiliates.....................................32
3.23. Clients..........................................................32
3.24. Information Technology...........................................33
3.25. Other Liabilities................................................33
3.26. Brokers..........................................................33
3.27. Absence of Certain Payments......................................33
3.28. Disclosure.......................................................34
3.29. Pooling..........................................................34
3.30. Adequate Information.............................................35
4. Representations and Warranties of the ▇▇▇▇▇▇ Companies..................35
4.1. Organization and Qualification...................................35
4.2. Agreement........................................................35
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4.3. Brokers..........................................................36
5. Covenants of Arista and Curcura.........................................37
5.1. Action to Closing................................................37
5.2. Access and Information...........................................39
5.3. Publicity; Confidentiality.......................................39
5.4. Best Efforts.....................................................39
5.5. Negotiations with Other Parties..................................39
5.6. Public Offering..................................................40
6. Covenants of the ▇▇▇▇▇▇ Companies.......................................40
6.1. Publicity; Confidentiality.......................................40
6.2. Best Efforts.....................................................40
7. Conditions to the Obligations of Arista and Curcura.....................41
7.1. Representations and Warranties...................................41
7.2. Performance......................................................41
7.3. Closing Certificate..............................................41
7.4. Opinion of Counsel...............................................41
8. Conditions to the Obligations of the ▇▇▇▇▇▇ Companies...................42
8.1. Representations and Warranties...................................42
8.3. Closing Certificate..............................................42
8.4. Opinion of Counsel...............................................43
8.5. Consents; Permits................................................43
8.6. Employment Agreements............................................43
8.7. Redomiciliation..................................................43
8.8. Subscription Agreements..........................................43
8.9. Pooling Letter...................................................44
8.10. Ability to File Registration Statement...........................44
9. Adoption of Plans of Certain ▇▇▇▇▇▇ Companies' Subsidiaries.............44
10. Survival of Representations and Warranties; Indemnification.............45
10.1. Survival of Representations and Warranties.......................45
10.2. Indemnification by Curcura.......................................46
10.3. Indemnification by the ▇▇▇▇▇▇ Companies..........................47
10.4. Limit of Indemnification Obligations.............................47
10.5. Indemnification Procedures.......................................49
10.6. Waiver of Right to Contribution..................................50
11. Termination.............................................................51
12. General Provisions......................................................51
12.1. Modification; Waiver.............................................51
12.2. Entire Agreement, etc. .........................................51
12.3. Curcura's Consent................................................52
12.4. Expenses.........................................................52
12.5. Further Actions..................................................52
12.6. Notices..........................................................52
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12.7. Assignment.......................................................53
12.8. Counterparts.....................................................54
12.9. Headings.........................................................54
12.10. Governing Law....................................................54
12.11. Separability.....................................................54
12.12. Incorporation of Exhibits and Schedules..........................54
12.13. Submission to Jurisdiction.......................................54
12.14. Notice of Developments...........................................55
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EXHIBITS
Exhibit A - Arista - Delaware Certificate of Incorporation
and By-Laws
Exhibit B - Form of Opinion of Patterson, Belknap, ▇▇▇▇
& Tyler LLP
Exhibit C - Form of ▇▇▇▇▇ Transfer Corp. Representation Letter
Exhibit D - Form of Opinion of ▇▇▇▇▇, Banta, Rizzi, ▇▇▇▇▇▇▇▇▇▇▇▇ &
Basralian, P.C.
Exhibit E - Employment Agreement
Exhibit F - Pooling Letter
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CONSOLIDATION AGREEMENT
CONSOLIDATION AGREEMENT, dated as of June 25, 1998, by and among
ARISTA MARKETING ASSOCIATES, INC., a New Jersey corporation ("Arista"), ▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇"), ▇▇▇▇▇ TRANSFER CORP., a Delaware corporation ("▇▇▇▇▇
Transfer"), and the corporations other than Arista and ▇▇▇▇▇ Transfer listed on
the signature pages hereof (the "▇▇▇▇▇▇ Companies"; Arista, ▇▇▇▇▇▇▇, ▇▇▇▇▇
Transfer and the ▇▇▇▇▇▇ Companies, collectively, the "Parties").
WHEREAS, the Parties wish Arista to acquire all of the issued and
outstanding common stock of the ▇▇▇▇▇▇ Companies, as well as an affiliated
company;
WHEREAS, Curcura is the sole shareholder of Arista; and
WHEREAS, the Parties intend that the acquisition of all of the
equity of the ▇▇▇▇▇▇ Companies be accounted for as a pooling of interests;
NOW, THEREFORE, in consideration of the premises and the
representations, warranties and covenants herein contained, the Parties agree as
follows:
1. Definitions. As used herein, the following terms shall have the
respective meanings set forth below or in the section indicated.
"Affiliate" has the meaning set forth in Rule 12b-2 of the
regulations promulgated under the Securities Exchange Act.
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"Arista Shares" means the shares of the Common Stock, $0.01 par
value per share, of Arista, after Redomiciliation.
"Arista Stock Option Plan" has the meaning set forth in Section
9(b).
"Balance Sheet" has the meaning set forth in Section 3.7.
"Benefit Plans" has the meaning set forth in Section 3.20(a).
"Closing" has the meaning set forth in Section 2.5.
"Closing Date" has the meaning set forth in Section 2.5.
"Code" has the meaning set forth in Section 3.19(a)(iii).
"Common Stock" has the meaning set forth in Section 3.3.
"Curcura Affiliate" has the meaning set forth in Section 3.22.
"Curcura Loan" has the meaning set forth in Section 5.7.
"Damages" has the meaning set forth in Section 10.2.
"Deductible Amount" has the meaning set forth in Section 10.4(a).
"ERISA" has the meaning set forth in Section 3.20(a).
"Financial Statements" has the meaning set forth in Section 3.5.
"Found Assets" has the meaning set forth in Section
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10.4(a).
"Fry Arbitration" has the meaning set forth in Section 2.8.
"GAAP" means United States generally accepted accounting principles
as in effect from time to time.
"Indemnitee" has the meaning set forth in Section 10.5.
"Indemnitor" has the meaning set forth in Section 10.5.
"IRS" means the Internal Revenue Service.
"Insurance Policies" has the meaning set forth in Section 3.21.
"Knowledge" means, with respect to a Person which is an individual,
the actual knowledge or awareness of such Person and, with respect to any other
Person, the actual knowledge or awareness of a Responsible Person of such
Person.
"▇▇▇▇▇▇ Companies" means the corporations (other than Arista and
▇▇▇▇▇ Transfer) listed on the signature pages hereof.
"▇▇▇▇▇▇ Shares" means the shares of the Nelson Companies.
"▇▇▇▇▇▇ Stockholders" means the holders of the ▇▇▇▇▇▇ Shares.
"Ordinary Course of Business" means the ordinary course of business
consistent with past custom and practice (including with respect to quantity and
frequency).
"Permits" has the meaning set forth in Section 3.19.
"Person" means an individual, a partnership, a corporation, an
association, a joint stock company, a limited
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liability company, a trust, a joint venture, an unincorporated organization, or
a governmental entity (or any department, agency, or political subdivision
thereof).
"Private Placement Memorandum" has the meaning set forth in Section
3.30.
"Redomiciliation" has the meaning set forth in Section 2.6.
"Responsible Person" means, with respect to any Person which is a
corporation, the chairman of the board of directors, president, chief executive
officer, chief financial officer, controller, secretary, treasurer, or any
director or vice president, and with respect to any other Person which is not an
individual, any partner, officer, trustee, member of the board of directors or
senior manager.
"Return" has the meaning set forth in Section 3.18(a)(ii).
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Exchange Act" means the Securities Exchange Act of 1934,
as amended.
"Subscription Agreement" has the meaning set forth in Section
2.3(c).
"Tax" has the meaning set forth in Section 3.18(a)(i).
2. Basic Transactions.
2.1. ▇▇▇▇▇▇ Companies. On the terms and subject to the conditions
set forth in this Agreement, Arista will at the
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Closing exchange Arista Shares for all of the issued and outstanding shares of
common stock of the ▇▇▇▇▇▇ Companies tendered to it by ▇▇▇▇▇▇ Stockholders by
execution and delivery to Arista by such ▇▇▇▇▇▇ Stockholders prior to the
Closing Date of a Subscription Agreement. Each of the holders of the stock of
the ▇▇▇▇▇▇ Companies shall receive the number of Arista Shares set forth on
Exhibit A (subject to the provisions of Section 2.2) for the shares of stock of
the ▇▇▇▇▇▇ Companies held by such Person.
2.2. ▇▇▇▇▇ Transfer Corp. On the terms and subject to the
conditions set forth in this Agreement, Arista will at the Closing exchange
Arista Shares for all of the shares of ▇▇▇▇▇ Transfer, an entity which is a
member of Healthcall Network LLC. The number of Arista Shares that ▇▇▇▇▇ ▇.
▇▇▇▇▇, the sole shareholder of ▇▇▇▇▇ Transfer, will receive as a result of this
exchange is included in the total set forth opposite his name on Exhibit A.
2.3. Consequences of Transactions. As a result of the transactions
described in Sections 2.1 and 2.2, and after Redomiciliation, (a) if
Subscription Agreements are received from all of the ▇▇▇▇▇▇ Stockholders and the
sole stockholder of ▇▇▇▇▇ Transfer with respect to all of the ▇▇▇▇▇▇ Shares,
Arista will have 24,000,000 Arista Shares issued and outstanding and (b) Curcura
will own 727,273 Arista Shares.
2.4. Effect of this Agreement. By entering into this Agreement, the
▇▇▇▇▇▇ Companies agree to:
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(a) recommend to the ▇▇▇▇▇▇ Stockholders that they tender
their share holdings to Arista for exchange for Arista Shares in
accordance with the terms of this Agreement;
(b) circulate to the ▇▇▇▇▇▇ Stockholders a Private Placement
Memorandum setting forth such information as to the proposed
exchange as the ▇▇▇▇▇▇ Companies believe is advisable to include to
ensure compliance with the Securities Act; and
(c) use their best efforts to obtain from the ▇▇▇▇▇▇
Stockholders a subscription agreement (the "Subscription Agreement")
tendering their shares for exchange in accordance with the
provisions of this Agreement and making such representations to
Arista as are customary in private placements of securities.
2.5. The Closing. The closing of the transactions contemplated by
this Agreement (the "Closing") shall take place at the offices of Patterson,
Belknap, ▇▇▇▇ & Tyler LLP, 1133 Avenue of the Americas, New York, New York,
commencing at 10:00 a.m. local time on June 30, 1998 (the "Closing Date") or at
or on such other date, time and place as may be agreed upon by the Parties.
2.6. Actions at the Closing. On the Closing Date, (a) Arista will
deliver to the ▇▇▇▇▇▇ Companies and ▇▇▇▇▇ Transfer the various certificates,
instruments, and documents referred to in Section 8, (b) the ▇▇▇▇▇▇ Companies
and ▇▇▇▇▇
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Transfer will deliver to Arista the various certificates, instruments, and
documents referred to in Section 7, (c) Arista will deliver to the ▇▇▇▇▇▇
Stockholders and the sole stockholder of ▇▇▇▇▇ Transfer certificates evidencing
Arista Shares against surrender of the certificates (or, in the case of share
certificates that cannot be found, lost certificate affidavits) evidencing the
▇▇▇▇▇▇ Shares, endorsed for transfer or accompanied by executed stock powers.
2.7. Redomiciliation of Arista, etc. Prior to Closing Date,
Arista, acting through its Board of Directors and sole shareholder in accordance
with applicable law, its certificate of incorporation and by-laws, and the
written consent of its sole shareholder, shall have redomiciled in the State of
Delaware and adopted its certificate of incorporation and by-laws in the
respective forms set forth in Exhibit A (such actions, the "Redomiciliation").
Among other things, such certificate of incorporation shall authorize the
issuance of a sufficient number of shares of Common Stock to allow the share
exchange contemplated by this Agreement.
2.8. Issuance of Additional Shares to Curcura. In the event
that the arbitration with ▇▇▇▇▇ ▇. ▇▇▇ and The Peer Group, Inc. (the "Fry
Arbitration") results in a recovery of monies by Arista in excess of legal fees
incurred by Arista after the Closing Date, Arista shall issue to Curcura that
number of additional Arista Shares as shall be equal in value such excess.
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For the purpose of any such issuance of Arista Shares, the valuation set forth
in Section 10.4(b) shall govern.
3. Representations and Warranties of Arista and Curcura. Arista and
Curcura, jointly and severally, represent and warrant to the ▇▇▇▇▇▇ Companies
and ▇▇▇▇▇ Transfer as follows:
3.1. Organization and Qualification. Arista is a corporation
duly organized, validly existing and in good standing under the laws of the
State of New Jersey and has all requisite power and authority to own, lease and
operate its properties and carry on its business as now being conducted.
3.2. Subsidiaries. Arista does not own or control, directly or
indirectly, any shares of, or interest in, any corporation, partnership, joint
venture, association or other business entity.
3.3. Capitalization. The authorized capital stock of Arista
consists of 2,500 shares of common stock, par value $1.00 per share (the "Common
Stock"), of which 1,000 shares of Common Stock are issued and outstanding. All
of the issued and outstanding shares of Common Stock are duly authorized,
validly issued, fully paid, nonassessable and free of preemptive rights. Other
than pursuant to this Agreement, there are no options, warrants, calls,
subscriptions, convertible securities, or other rights or other agreements or
commitments of any character whatsoever obligating Arista to issue or sell any
shares of its capital stock or any securities convertible into or exchangeable
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or exercisable for, or otherwise evidencing a right to acquire, any shares of
its capital stock or other securities of any kind of Arista. There are no voting
trusts or other agreements or understandings to which Arista is a party with
respect to the voting of the capital stock of Arista.
3.4. Agreement; Title to Shares. Arista has all requisite
power and authority and Curcura has all requisite capacity and authority to
enter into this Agreement. This Agreement has been duly authorized, executed and
delivered by Arista and Curcura and constitutes the legal and binding obligation
of Arista and Curcura, enforceable in accordance with its terms. The execution
and delivery by Arista and Curcura of this Agreement, the consummation of the
transactions contemplated hereby, and the performance by Arista and Curcura of
their respective obligations hereunder will not conflict with or result in any
violation of, or any default under (either immediately or with notice or lapse
of time), or any right to accelerate or the creation of any lien, charge or
encumbrance pursuant to, any provision of (a) the certificate of incorporation
or by-laws of Arista, (b) except as set forth on Schedule 3.4, any agreement,
contract, lease, license, note, bond, mortgage, indenture, deed of trust or
other instrument to which Arista or Curcura is a party or by which any of the
properties or other assets of Arista or Curcura is bound, (c) any governmental
franchise, license, permit or authorization, or any judgment or order of any
tribunal or governmental body applicable to Arista or Curcura or any of
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the properties or other assets of Arista or Curcura, or (d) any law, statute,
decree, rule or regulation of any jurisdiction. No authorization, consent or
approval of, or declaration of, filing with or notice to any governmental body
or authority by Arista or Curcura is necessary for the execution of this
Agreement by Arista or Curcura, the consummation by Arista and Curcura of the
transactions contemplated hereby or the performance by Arista and Curcura of
their respective obligations hereunder. Curcura owns beneficially and of record,
free and clear of any lien, pledge, hypothecation, mortgage or other
encumbrance, all of the issued and outstanding Common Stock, and will own
beneficially and of record, free and clear of any lien, pledge, hypothecation,
mortgage or other encumbrance, all of the Arista Shares after Redomiciliation.
3.5. Financial Statements. Arista has previously delivered to
▇▇▇▇▇▇ true and complete copies of (a) the balance sheets of Arista as of
December 31, 1997, 1996 and 1995 and the related statements of income, retained
earnings and cash flows for such years then ended, as compiled by Ross, Anglim,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, certified public accountants, and interim
statements of income for the quarter ended March 31, 1998, prepared by Arista's
staff. Such statements, including the notes to all such statements, if any, are
referred to herein collectively as the "Financial Statements." The Financial
Statements have been prepared on a consistent basis throughout the periods
specified, although not in accordance with GAAP, and
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present fairly the financial position of Arista as of the respective dates
specified and the results of operations and changes in financial position of
Arista for the respective periods specified. All information supplied by Arista
to ▇▇▇▇▇ ▇▇▇▇▇▇ LLP, certified public accountants, to permit such firm to
prepare financial statements in accordance with GAAP and all information
supplied to Deloitte & Touche LLP, certified public accountants, to permit such
firm to audit such financial statements, is and will be true and correct.
3.6. Title to Property, Absence of Encumbrances, etc. Set
forth on Schedule 3.6 is a complete and accurate list of (a) all real property
and all material equipment, furniture and fixtures owned or leased by Arista,
and (b) all mortgages, liens and material encumbrances to which such real
property, equipment, furniture and fixtures are subject. Except for leased
property and as specified in Schedule 3.6, Arista has good and marketable title
to all assets, real or personal, tangible or intangible, owned or used by it,
respectively, including, without limitation, all assets reflected in the most
recent balance sheet included in the Financial Statements (other than any assets
sold or otherwise disposed of in the Ordinary Course of Business since the date
of such balance sheet), free and clear of all mortgages, pledges, liens,
security interests or encumbrances of any nature (other than liens for taxes,
assessments or other governmental charges not yet due and payable, or presently
payable without penalty or interest) including, without limitation, any
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governmental restrictions on the operation of such assets. All buildings,
equipment, furniture and fixtures listed on Schedule 3.6 owned or leased by
Arista are in good operating condition and repair. All real property owned or
leased by Arista has been constructed and operated in compliance with all
applicable federal, state, county and municipal laws, regulations, ordinances,
standards and orders, including without limitation all zoning and environmental
laws, regulations, ordinances, standards and orders. There are no outstanding
enforcement actions or notices of violation issued by any federal, state, county
or municipal authority having jurisdiction over any such property.
3.7. Accounts Receivable and Accounts Payable. The accounts
receivable of Arista reflected in the Financial Statements, to the extent not
yet collected, are from bona fide accounts receivable created in the Ordinary
Course of Business and, except to the extent reserved against on the Financial
Statements, are current and there is no reason to believe they will not be
collectible in the Ordinary Course of Business. Any reserve established against
accounts receivable after December 31, 1997 is and shall be on a basis
consistent with that applied in preparing the balance sheets included in the
Financial Statements. Except as set forth in Schedule 3.7 or to the extent
reserved against in the balance sheet as of December 31, 1997 included in the
Financial Statements (the "Balance Sheet"), no client has indicated or asserted
that it has a counterclaim or
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other offsetting claim with respect to such receivables. All accounts payable
reflected on the Balance Sheet, and all accounts payable arising subsequent to
the date of such Balance Sheet, have arisen in the Ordinary Course of Business,
represent valid obligations of Arista and, have been paid or are being paid in
accordance with past practices.
3.8. Books and Records. Except as stated on Schedule 3.8, the
minute books, stock record books, and other material non-financial records of
Arista, all of which have been made available to the ▇▇▇▇▇▇ Companies, are
complete and correct in all material respects and have been maintained in
accordance with sound business practices and substantially reflect the basis for
the financial condition and results of operations of Arista set forth in the
Financial Statements. The minute books of Arista contain accurate and complete
records of all meetings held of, and corporate action taken by, the
stockholders, the Board of Directors, and committees of the Board of Directors
of Arista, and no meeting of any such stockholders, Board of Directors, or
committee has been held for which minutes have not been prepared and are not
contained in such minute books. As of the Closing Date, all of the books and
records referred to in this Section 3.8 will be in the possession of the ▇▇▇▇▇▇
Companies.
3.9. Patents, Trademarks, etc. Schedule 3.9 contains a
complete and correct list of all patents, trademarks registered or claimed by
Arista, trade names and registered copyrights owned or used by, or registered in
the name of,
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Arista, and of all applications for patents or for registration of trademarks,
trade names or copyrights made by Arista, or by any of its employees, for the
benefit of Arista. Except as otherwise indicated in Schedule 3.9, Arista is the
registered and beneficial owner of all such patents, trademarks, trade names and
registered copyrights, free and clear of any license, royalty, lien, encumbrance
or other interest of any third party. Arista owns or has the right to use all
patents, patent applications, trademarks, trade names, copyrights or other
intellectual property rights, including, without limitation, trade secrets,
technology and know-how, necessary for the conduct of its business. Other than
as set forth on Schedule 3.9, there is no existing, pending or threatened claim
by Arista against any third party for infringement, misuse or misappropriation
of any patent, trademark, trade name, copyright or other intellectual property
(including without limitation any trade secrets or know-how) owned by Arista or
in which Arista has an interest. There is no existing, pending or, to the
Knowledge of Arista or Curcura, threatened, action, suit, or proceeding against
Arista for infringement, misuse or appropriation by Arista of any patent,
trademark, trade name, copyright or other intellectual property (including
without limitation any trade secret or know-how) owned or claimed to be owned by
any third party or any basis therefor.
3.10. Employee Remuneration, etc. (a) Schedule 3.10 lists the
position and the current salaries, bonuses, or any other form of compensation
paid (together with pending or
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anticipated increases therein) to each director, officer, employee, consultant
or agent of Arista including any bonuses which Arista has promised or currently
anticipates paying to any such person. No officer or other key employee of
Arista has indicated an intention to terminate his or her employment with
Arista.
(b) Schedule 3.10 also lists each officer, employee, consultant and
agent of Arista who has entered into an employment contract, consulting contract
or other special arrangement with Arista, and true and complete copies of all
such contracts and descriptions of all such arrangements have been previously
delivered to the ▇▇▇▇▇▇ Companies.
(c) Except as set forth on Schedule 3.10, Arista has not entered
into any agreement or arrangement with any employee, officer, director or
provider of services of Arista to pay any of them any amount beyond their
regular salary or other compensation as an inducement to remain at their present
position until, or contingent upon, the execution of this Agreement or the
consummation of the transactions contemplated hereby or pursuant to which Arista
could have any obligation to pay any of them compensation in the event of, or as
a consequence of (i) the severance of their employment or relationship with
Arista following a change of control of Arista or (ii) a change of control of
Arista.
3.11. Labor Matters. Arista is not a party to any collective
bargaining agreement. Except as disclosed on Schedule
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3.11, no attempt to organize the employees of Arista has been made, nor is any
such attempt now threatened or, to the Knowledge of Arista or Curcura, being
planned. Arista is in compliance with all applicable Federal, state and local
laws, rules and regulations regarding employment conditions and practices, has
withheld all amounts required by law or agreement to be withheld from the wages
or salaries of its employees and is not liable for any arrears of wages or any
taxes or penalties for failure to comply with any of the foregoing. Arista has
not engaged in any unfair labor practices and has not discriminated on the basis
of age, sex or other discrimination prohibited by law in its respective
employment conditions or practices. Except as set forth on Schedule 3.11, there
are no unfair labor practice or age or sex discrimination charges or complaints
or other charges or complaints alleging illegal discriminatory practices pending
or threatened against Arista before any Federal, state or local board,
department, commission or agency, nor to the Knowledge of Arista or Curcura does
any basis therefor exist. There are no existing or threatened labor strikes,
disputes, grievances, controversies or other labor troubles affecting Arista.
There are no pending or threatened representation questions respecting the
employees of Arista or any pending arbitration proceedings.
3.12. Bank Accounts. Schedule 3.12 lists the name and location
of each bank or other institution in which Arista has any account or safe
deposit box, the number or other
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identification thereof and the names of all persons authorized to draw thereon
or have access thereto.
3.13. No Adverse Change. Since January 1, 1998, there has not
been any material adverse change in the financial condition, operations,
business or prospects of Arista.
3.14. Absence of Certain Changes. Except as set forth on
Schedule 3.14 or pursuant to the Other Merger Agreements, since January 1, 1998,
Arista has not (a) issued, sold or delivered or agreed to issue, sell or deliver
any shares of its capital stock or any options or rights to acquire any such
capital stock or securities convertible into or exchangeable for such capital
stock, (b) incurred any material obligations or liabilities, whether absolute,
accrued, contingent or other, other than obligations and liabilities incurred in
the Ordinary Course of Business, (c) mortgaged, pledged or subjected to any
lien, lease, security interest or other encumbrance (other than liens for taxes,
assessments or other governmental charges not yet due and payable, or presently
payable without penalty or interest), any of its assets, real or personal,
tangible or intangible, (d) acquired or disposed of any assets or properties, or
entered into any agreement for any such acquisition or disposition, except in
the Ordinary Course of Business, (e) incurred any obligation for borrowed money
which remains outstanding on the date hereof, except for borrowings in an
aggregate amount not exceeding $10,000 in the Ordinary Course of Business, (f)
forgiven or canceled any debts or claims or waived
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any rights of material value not previously accrued, (g) granted or promised any
increase in compensation in any form of more than five percent to any officer or
other employee or granted any severance or termination pay, agreed to or
indicated the intention of paying to any officer or other employee a bonus or
other compensation not included in such person's base salary in excess of the
bonus or other compensation previously paid such person, or entered into any
employment agreement, or any modification of a previously existing employment
agreement, with any officer or any other salaried employee, (h) adopted, amended
or entered into any collective bargaining, bonus, profit sharing, compensation,
stock option, pension, retirement, deferred compensation or other plan,
agreement or arrangement for the benefit of employees, (i) granted any rights or
licenses under any of its trademarks, trade names, copyrights or other
intellectual property rights, (j) made any capital expenditure or binding
commitment therefor which individually or in the aggregate exceeds $10,000, (k)
sold, assigned or transferred any of its assets (tangible or intangible) or
otherwise disposed of any property, trademark, trade name, assumed name,
copyright (or pending application therefor) or interest thereunder, except in
each case in the Ordinary Course of Business, (l) suffered any material loss of,
or adverse change in its relationship with, any material client or customer or
has Knowledge that any such client or customer intends or is contemplating any
action which would constitute or lead to such a loss or adverse change, or
written
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down the value of any work-in-process or written off as uncollectible any notes
or accounts receivable, except write-downs and write-offs in the Ordinary Course
of Business, (m) suffered any damage, destruction or loss (whether or not
covered by insurance) which has a material adverse effect on its business, (n)
suffered any strike or other labor trouble which has materially affected its
operations, (o) terminated or made any substantial revision of, or engaged in
any renegotiation of, any material contract, (p) materially decreased the level
of maintenance on, or its expenditures for maintenance of, the real property,
equipment, furniture and fixtures owned or leased by it, (q) made any change in
accounting principles or methods or in classification, depreciation or
amortization policies or rates, (r) settled any dispute involving payment by
Arista in excess of $5,000, or canceled, forgiven or reduced any obligation of
any Person in an amount in excess of $5,000, (s) made any loan or advance in
excess of $5,000 to any Person other than travel or expense advances in
accordance with its normal policies which have been accounted for or repaid and
extension of trade credit in accordance with its normal business practices, (t)
amended or terminated any agreement which is material to its business, except
amendments in the Ordinary Course of Business which have not had and will not
have a material adverse effect on Arista; (u) renewed, extended or modified any
lease of real property, or personal property, except in the Ordinary Course of
Business, in circumstances that have not had and will not have a material
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adverse effect on Arista; or (v) entered into any material transaction other
than in the Ordinary Course of Business.
3.15. Litigation. Other than as set forth on Schedule 3.15,
there is no judicial or administrative action, suit, proceeding or governmental
investigation pending or to the Knowledge of Arista or Curcura threatened before
any court or tribunal or governmental instrumentality, or any citation, order or
notice of violation of any law, decree, rule or regulation, by or against Arista
or Curcura or any of Arista's properties, or which relates in any way to
Arista's business, properties, assets or operations, or which has or is likely
to result in an imposition of a lien on any of the properties or assets owned or
leased by Arista, or which questions the validity of this Agreement or any
action to be taken in connection herewith, nor is there any such action, suit,
proceeding or investigation, pending or, to the Knowledge of Arista or Curcura
threatened, which involves any director, officer, employee, consultant or
independent contractor of Arista in its or his capacity as such. Except as set
forth in Schedule 3.15, neither Arista nor any property or assets of Arista is
subject to any judicial or administrative order, judgment, injunction or decree
nor has Arista been a party to any product or professional liability litigation
within the last five years.
3.16. Compliance with Other Instruments and Laws. Arista is
not in violation of any provision of (a) its charter or by-laws, or (b) any
agreement, contract, mortgage, lease, license
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or other instrument, governmental franchise, license, permit or authorization,
judgment or order of any tribunal or governmental body, or law, statute, decree,
rule or regulation applicable to it or any of its properties or to which it is a
party or by which it is bound.
3.17. Contracts, etc. Schedule 3.17 contains a complete and
correct list (to the extent not listed on any other Schedule to this Agreement)
of each (a) profit sharing, bonus, deferred compensation, stock option,
severance pay, pension, retirement or similar plan, agreement or arrangement of
Arista, (b) mortgage, debenture, note or installment obligation, or other
instrument or contract for the borrowing or lending of money by Arista,
including without limitation any agreement or arrangement relating to the
maintenance of compensating balances or the availability of a line of credit,
(c) license agreement, sales agency agreement or franchise agreement (other than
off-the-shelf software licenses) to which Arista is a party, (d) guaranty of any
obligation of any person by Arista, including without limitation any keep-well,
make-whole or maintenance of working capital or earnings or similar agreement,
(e) agreement for the sale of any properties or assets by Arista other than
sales of products or services in the Ordinary Course of Business to clients or
customers which in 1997 generated or which in 1998 obligates the customer or
client to pay, revenues of $10,000 or more, (f) contract, purchase order or
other agreement, other than a contract, purchase order or other agreement (i)
for the
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purchase of equipment, furniture or fixtures with an aggregate consideration of
less than $10,000, made in the Ordinary Course of Business, or (ii) for the
purchase of materials or supplies made in the Ordinary Course of Business,
pursuant to which Arista is or may be obligated to make payments, contingent or
otherwise, on account of or arising out of the acquisition, prior, pending or
future, of the shares, business, or other assets of another enterprise, (g)
secrecy or invention agreement under which Arista or any of the present officers
or employees of Arista has any obligation and relating to the business of
Arista, (h) agreement for the purchase or sale of goods or services not
terminable without liability by Arista on 90 days' (or less) notice or involving
payments by or to Arista in excess of $10,000, (i) agreement or arrangement with
a customer or client of Arista for rebates, sharing of expenses or any similar
device for the effective reduction or increase of prices or other charges and
involving products or services with a value in excess of $10,000, (j) agreement
of Arista with, or loan or advance by Arista to or from, or other obligation of
Arista to or from any officer or director of Arista, (k) lease of real or
personal property with Arista as lessor or lessee, involving rents of more than
$10,000 per year, (l) agreement or arrangement limiting the freedom of Arista
or, to the Knowledge of Arista or Curcura, any of the present or former officers
or employees of Arista to compete in any line of business similar to Arista's
business, with any person or other entity or in any geographical area, (m)
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governmental license, franchise, permit or authorization held by and material to
the business of Arista and not listed on any other Schedule hereto, (n)
outstanding powers of attorney executed by or on behalf of Arista, (o) joint
venture agreement or partnership, profit sharing or other similar agreements to
which Arista is a party, (p) contract, commitment or agreement not referred to
above in this Section 3.17 or in any other Schedule to this Agreement and any
one of which involves aggregate payments by or to Arista of $10,000 or more. All
such contracts and agreements are, with respect to Arista, valid, binding and in
full force and effect, neither Arista nor any other party is in material default
thereunder and no event has occurred which, whether with notice, lapse of time
or otherwise, would constitute a default by Arista thereunder, and Arista has
not received or sent any notice of cancellation or termination thereunder.
Except as disclosed in Schedule 3.17 hereto, no consent of any party or the
payment of any penalty or incurrence of any additional obligation or change of
any terms is necessary so that all rights of Arista under contracts extending
beyond the Closing Date shall continue unimpaired on and after the Closing Date.
3.18. Taxes. (a) As used in this Section 3.18, the following
terms have the following meanings:
(i) "Tax" means any federal, state, local, or foreign
income, gross income, gross receipts, license, payroll, employment, excise,
severance, stamp, occupation,
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premium, windfall profits, environmental (including taxes under Code ss. 59A),
customs duties, capital stock, franchise, profits, withholding, social security
(or similar), unemployment, disability, real property, personal property, sales,
use, transfer, ad valorem, lease, service use, registration, value added,
alternative or add-on minimum, estimated, or other tax, fee, assessment or
change of any kind whatsoever, including any interest, penalty, or addition
thereto, whether disputed or not, together with any expenses incurred in
connection with the determination, settlement or litigation of any Tax
liability;
(ii) The term "Return" means any return, declaration,
report, statements or other document required to be filed in respect of Taxes,
including, where permitted or required, combined or consolidated returns for any
group of entities that includes Arista;
(iii) The term "Code" means the Internal Revenue Code of
1986, as amended; all citations to the Code, or to the Treasury Regulations
promulgated thereunder, shall include any amendments or any substitute or
successor provisions thereto; and
(iv) Any reference in this Section 3.18 to Arista
includes a reference to a person acting on behalf of Arista.
(b) Arista has timely filed all Returns that it was required
to file. All such Returns were correct and complete in all respects. All Taxes
owed by Arista (whether or not shown
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on any Return) have been paid. Arista currently is not the beneficiary of any
extension of time within which to file any Return. No claim has ever been made
by an authority in a jurisdiction where Arista does not file a Return that it is
or may be subject to taxation by that jurisdiction. There are no liens on any of
the assets of any of Arista that arose in connection with any failure (or
alleged failure) to pay any Tax.
(c) Arista has withheld and paid to the appropriate
governmental or regulatory authority all Taxes required to have been withheld
and paid in connection with amounts paid or owing to any employee, independent
contractor, creditor, stockholder, or other third party.
(d) No director or officer (or employee responsible for Tax
matters) of Arista expects any authority to assess any additional Taxes for any
period for which tax returns have been filed. There is no dispute or claim
concerning any Tax liability of Arista either (i) claimed or raised by any
authority in writing or (ii) as to which any of Arista and the directors and
officers (and employees responsible for Tax matters) of Arista has Knowledge.
Schedule 3.18 lists all federal, state, local, and foreign income tax returns
filed with respect to Arista for taxable periods ended on or after December 31,
1994, indicates those Returns that have been audited, and indicates those
Returns that currently are the subject of audit. Arista has delivered to ▇▇▇▇▇▇
correct and complete copies of all federal income tax returns, examination
reports, and statements
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of deficiencies assessed against or agreed to by Arista since December 31, 1994.
(e) Arista has not waived any statute of limitations in
respect of Taxes or agreed to any extension of time with respect to a Tax
assessment or deficiency.
(f) Arista has not filed a consent under Code ss. 341(f),
concerning collapsible corporations. Arista has not made any payments, is not
obligated to make any payments, and is not a party to any agreement that under
certain circumstances could obligate it to make any parachutes payments that
will not be deductible under Code ss. 280G, concerning "golden parachutes."
Arista has disclosed on its federal income tax returns all positions taken
therein that could give rise to a substantial understatement of federal income
Tax within the meaning of Code ss. 6662. Arista is not a party to any Tax
indemnity, Tax allocation or Tax sharing agreement. Arista is not a party to any
closing agreement pursuant to Section 7121 of the Code or any similar provision
of any state, provincial, local, or foreign law with respect to Arista or any
assets thereof. Arista has not received a Tax ruling from any Tax authority. No
power of attorney currently in force has been granted by Arista concerning any
Tax matter. Arista (i) has not been a member of an affiliated group filing a
consolidated federal income tax return and (ii) has no liability for the Taxes
of any person under Treas. Reg. ss. 1.1502-6 (or any similar provision of state,
local,
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or foreign law), as a transferee or successor, by contract, or otherwise.
(g) None of the assets of Arista is "tax-exempt use property"
within the meaning of Section 168(h) of the Code. Arista has not agreed to make,
nor is it required to make, any adjustment under Section 481(a) of the Code by
reason of a change in accounting method or otherwise. None of the assets of
Arista is property that Arista is required to treat as being owned by any other
person pursuant to the "safe harbor lease" provisions of former section
168(f)(8) of the Code. None of the assets of Arista directly or indirectly
secures any debt the interest on which is tax-exempt under Section 103(a) of the
Code. Arista has not participated in an international boycott within the meaning
of Section 999 of the Code. Arista has not been a United States real property
holding corporation (as defined in Section 897(c)(2) of the Code) during the
applicable period specified in Section 897(c)(1)(A)(ii) of the Code. Arista has
not had a permanent establishment in any foreign country, as defined in any
applicable tax treaty or convention between the United States and such foreign
country. Arista has made available (or, in the case of Tax Returns filed after
the Closing Date, will make available) to ▇▇▇▇▇▇ complete and accurate copies of
all Tax Returns and associated work papers filed by or on behalf of Arista for
all taxable years ending on or prior to the Closing Date.
(h) Schedule 3.18 sets forth the following information with
respect to Arista as of the most recent
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practicable date (as well as on an estimated pro forma basis as of the Closing
giving effect to the consummation of the transactions contemplated hereby): (i)
the basis of Arista in its assets and (ii) the amount of any net operating loss,
net capital loss, unused investment or other credit, unused foreign tax credit,
or excess charitable contribution allocable to Arista.
(i) The unpaid Taxes of Arista (i) did not, as of the most
recent fiscal month end, exceed the reserve for Tax liability (rather than any
reserve for deferred Taxes established to reflect timing differences between
book and Tax income) set forth on the face of the most recent balance sheet
(rather than in any notes thereto) and (ii) do not exceed that reserve as
adjusted for the passage of time through the Closing Date in accordance with the
past custom and practice of Arista in filing their tax returns.
3.19. Permits. Arista has obtained and holds all licenses,
permits, authorizations, consents and orders or approvals of all foreign,
Federal, state or local governmental or regulatory bodies that are necessary for
the lawful conduct of its business and to operate its properties and assets as
presently being operated (the "Permits"). All of the Permits are listed on
Schedule 3.19 and are validly issued and in full force and effect and Arista is
in compliance therewith. No proceeding is pending or threatened which seeks or
may result in the cancellation, suspension, restriction or modification of any
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Permit. The business of Arista is being operated in all respects in accordance
with the terms and conditions of the Permits.
3.20. Employee Benefit Plans.
(a) Schedule 3.20 lists (i) all "employee benefit plans," as
defined in Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA"), that are maintained, contributed to or required to be
contributed to by Arista, or under which Arista could incur any liability for
the benefit of current, former or retired employees of Arista or any of their
beneficiaries or dependents, and (ii) each other plan, program, policy,
contract, agreement or arrangement providing for bonuses, pensions, deferred
compensation, stock or stock related awards, severance pay, salary continuation
or similar benefits, hospitalization, medical, dental or disability benefits,
life insurance, key man life insurance or other employee benefits or
compensation to or for any Arista employee or members of their families, whether
or not insured or funded (together, the "Benefit Plans").
(b) Each Benefit Plan has been administered in all material
respects in accordance with its terms. On the date hereof, the Benefit Plans are
in compliance with the applicable provisions of ERISA and the Code, the rules
and regulations promulgated thereunder, all other applicable laws and the terms
of all applicable collective bargaining agreements. There are no investigations
by any governmental entity, or other claims (except routine claims for benefits
payable under the Benefit
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Plans), suits or proceedings against or with respect to which any Benefit Plan
is a party or asserting any rights to or claims for benefits under any Benefit
Plan that would give rise to any liability. To Arista's Knowledge, there are no
involuntary termination proceedings which have been instituted against any
Benefit Plans.
(c) All contributions to, and payments from, the Benefit Plans
that were required to be made in accordance with the terms of the Benefit Plans
and any applicable collective bargaining agreement have been timely made. All
premium payments that were required to be made in accordance with the terms of
the Benefit Plans or an underlying insurance contract have been timely made in
accordance therewith, except where such failure would not result in material
liability to Arista.
(d) Each Benefit Plan that is intended to be a tax-qualified
pension plan has been the subject of a favorable determination letter from the
IRS which was filed with the IRS within the remedial amendment period prescribed
under Section 401(b) of the Code with respect to compliance with the Tax Reform
Act of 1986 to the effect that such pension plan is qualified under Section
401(a) of the Code, subject to the customary reservations as to the plan's
operational compliance with the Code's requirements. No such determination
letter has been revoked and, to Arista's Knowledge, the IRS has not issued
written notice of its intent to revoke the qualified status of any such plan. To
Arista's Knowledge, no circumstances exist
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that would reasonably be expected to result in disqualification of such pension
plan.
(e) Arista does not and has not ever in the past maintained or
contributed to (i) any plan or arrangement that is intended to provide retiree
medical benefits to its retired employees or their beneficiaries or dependents,
(ii) any defined benefit pension plan that is required to meet the minimum
funding standards of Section 412 of the Code or Section 302 of ERISA, or (iii) a
multiemployer plan, as defined in Section 3(37) of ERISA.
3.21. Insurance. Schedule 3.21 lists all insurance policies to
which Arista is a party or which relate to the employees of Arista (the
"Insurance Policies") and sets forth for each Insurance Policy the name of the
insurer, the coverage limit, the amount and frequency of payment of the premium,
the term of the policy and a claims history for each Insurance Policy which is a
liability policy since January 1, 1995. The Insurance Policies are in full force
and effect, all premiums with respect thereto covering all periods up to and
including the date of the Closing have been paid or will be paid when due, and
no notice of cancellation or termination has been received with respect to any
Insurance Policy. The Insurance Policies provide coverage that is in compliance
with all material requirements of law and of all material agreements to which
Arista is a party, are valid, outstanding and enforceable policies, and provide
adequate insurance coverage for Arista and the operations of its business.
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3.22. Transactions with Affiliates. Schedule 3.22 describes
all transactions in excess of $5,000 individually and $20,000 in the aggregate
since January 1, 1997 between Arista and, directly and indirectly, Curcura or
any Affiliate of Curcura (a "Curcura Affiliate"), including, without limitation,
any loans by Arista to Curcura or any Curcura Affiliate or by any Curcura
Affiliate to Arista and the amounts outstanding under such loans on the date
hereof. Curcura has from time to time made loans to the Company. Except as set
forth in Schedule 3.22, none of Curcura, any Curcura Affiliate or any officer,
director or employee of Arista owns any interest (excepting stock holdings of up
to 1% of the capital stock of a corporation listed on a national securities
exchange or traded in an over-the-counter market) in a Person that is a
competitor of Arista. No officer, director, or employee of Arista is an officer,
director or employee of any organization that is a competitor or supplier of
Arista.
3.23. Clients. Schedule 3.23 sets forth the four largest
clients (measured by fees generated) of Arista as of December 31, 1997. Except
as described on Schedule 3.23, neither Arista nor Curcura has Knowledge or has
any reason to believe that any of Arista's clients or any supplier of goods,
products or services to Arista (a) has any complaint or objection with respect
to the service or any business practices of Arista or the transactions
contemplated hereby, or (b) will cease to do business, or significantly reduce
the business conducted, with
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Arista after or as a result of the consummation of any transactions contemplated
hereby.
3.24. Information Technology. Except as set forth on Schedule
3.24, Arista has the unrestricted right to use all software associated with its
databases. All of the hardware, software and firmware used in connection with
the business of Arista is and will be able accurately to process data
(including, but not limited to, calculating, comparing, and sequencing) from,
into and between the twentieth and twenty-first centuries, including leap year
calculations.
3.25. Other Liabilities. Arista does not have any liabilities
or obligations (direct or indirect, contingent or absolute, matured or
unmatured) of whatever nature, whether arising out of contract, tort, statute or
otherwise, except (a) as reflected in the Balance Sheet, (b) disclosed in the
Schedules to this Agreement and (c) liabilities and obligations incurred in the
Ordinary Course of Business which do not in the aggregate involve an amount
greater than $5,000.
3.26. Brokers. No finder, broker, agent or other intermediary
has acted on behalf of Arista in connection with this Agreement or the
transactions contemplated hereby.
3.27. Absence of Certain Payments. Neither Arista nor any
officers, directors, employees, agents, representatives, or independent
contractors of Arista has made, or arranged for the making of, any unlawful
payment to any official, officer or employee of any foreign, Federal, state,
county, municipal or
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other governmental or regulatory body or authority or any self-regulatory body
or authority, or made any payment to any customer or supplier of Arista or any
officer, director, partner, employee or agent of any customer or supplier, for
the unlawful sharing of fees or to any such customer or supplier or any such
officer, director, partner, employee or agent for the unlawful rebating of
charges, or engaged in any other unlawful reciprocal practice, or made any other
unlawful payment or given any other unlawful consideration to any such customer
or supplier or any such officer, director, partner, employee or agent, in
respect of Arista.
3.28. Disclosure. This Agreement, the Schedules hereto, the
Financial Statements and any other information furnished or to be furnished by
Arista in connection with this Agreement and the transactions contemplated
hereby do not contain any untrue statement of a material fact or omit to state
any fact necessary to make the statements contained therein not false or
misleading. There is no fact known to Arista, its directors and officers or
Curcura which materially affects or will materially affect the properties,
assets, financial condition, operations, prospects or business of Arista which
has not been set forth in this Agreement, the Schedules hereto or the Financial
Statements.
3.29. Pooling. Neither Arista nor any of its Affiliates has
through the date of this Agreement taken or agreed to take any action that would
prevent Arista and the ▇▇▇▇▇▇
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Companies from accounting for Arista's acquisition of the ▇▇▇▇▇▇ Shares as a
pooling of interests.
3.30. Adequate Information. Each of Curcura and Arista
acknowledges that he and it have received a copy of the preliminary Private
Placement Memorandum, dated May 7, 1998, including the exhibits thereto, and of
the final Private Placement Memorandum, dated June 4, 1998, including the
exhibits thereto (the "Private Placement Memorandum"), which describe the
business and structure of Arista and its Affiliates after giving effect to the
transactions contemplated hereby, and has had the opportunity to ask questions
of and obtain information from the responsible officers of the ▇▇▇▇▇▇ Companies
with respect thereto.
4. Representations and Warranties of the ▇▇▇▇▇▇ Companies. The
▇▇▇▇▇▇ Companies represent and warrant to Arista and Curcura as follows:
4.1. Organization and Qualification. Each of the ▇▇▇▇▇▇
Companies is a corporation duly organized, validly existing and in good standing
under the laws of the state of its incorporation and has all requisite power and
authority to own, lease and operate its properties and carry on its business as
now being conducted.
4.2. Agreement. Each of the ▇▇▇▇▇▇ Companies has the requisite
corporate power to enter into this Agreement. This Agreement has been duly
authorized, executed and delivered by the ▇▇▇▇▇▇ Companies and constitutes the
legal and binding obligation
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of the ▇▇▇▇▇▇ Companies, enforceable in accordance with its terms. The execution
and delivery by the ▇▇▇▇▇▇ Companies of this Agreement, the consummation by the
▇▇▇▇▇▇ Stockholders of the transactions contemplated hereby and the performance
by the ▇▇▇▇▇▇ Companies of their obligations hereunder will not conflict with or
result in any violation of, or any default under (either immediately or with
notice or lapse of time), any provision of (a) any agreement, contract, lease,
license, note, bond, mortgage, indenture, deed of trust or other instrument to
which any of the ▇▇▇▇▇▇ Companies is a party or by which any of their respective
properties or other assets is bound, (b) any governmental franchise, license,
permit or authorization, or any judgment or order of any tribunal or
governmental body applicable to any of the ▇▇▇▇▇▇ Companies or any of their
respective properties or other assets, or (c) any law, statute, decree, rule or
regulation of any jurisdiction. No authorization, consent or approval of, or
declaration of, filing with or notice to any governmental body or authority by
any of the ▇▇▇▇▇▇ Companies is necessary for the execution of this Agreement by
the ▇▇▇▇▇▇ Companies, the consummation by the ▇▇▇▇▇▇ Stockholders of the
transactions contemplated hereby or the performance by the ▇▇▇▇▇▇ Companies of
their obligations hereunder.
4.3. Brokers. No finder, broker, agent or other intermediary
has acted on behalf of the ▇▇▇▇▇▇ Companies in connection with this Agreement or
the transactions contemplated hereby.
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5. Covenants of Arista and Curcura. Arista and Curcura covenant as
follows:
5.1. Action to Closing. From the date of this Agreement until
the Closing Date, Arista will, and Curcura shall cause Arista to, (a) conduct
its affairs only in the Ordinary Course of Business, in substantially the manner
as heretofore conducted and in accordance with all laws, rules, regulations,
orders, approvals, authorizations, exemptions, classifications and
registrations, (b) maintain all of its assets in as good condition and repair as
of the date hereof, reasonable wear and tear excepted, (c) perform in all
material respects all of its obligations under all contracts to which it is a
party, and not amend, alter or modify any provision of any such contract or
enter into any new contract or transaction involving consideration in excess of
$5,000 or which would have been required to be listed on Schedule 3.17 if in
effect on the date hereof, or dispose, other than in the Ordinary Course of
Business, of any assets having a value in excess of $5,000 in the aggregate
without the prior written consent of ▇▇▇▇▇▇, (d) use its best efforts to
maintain the existing relationships with all clients, customers and others
having business dealings with Arista, (e) use its best efforts to keep available
the services of its present officers and employees, (f) promptly deliver to the
▇▇▇▇▇▇ Companies interim financial statements as regularly prepared for their
internal use, (g) confer on a regular and frequent basis with representatives of
the ▇▇▇▇▇▇ Companies to
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report material operational matters and the general status of ongoing
operations, (h) not authorize or effect any change in its certificate of
incorporation or by-laws; (i) not grant any options, warrants, or other rights
to purchase or obtain any of its capital stock or issue, sell, or otherwise
dispose of any of its capital stock (except upon the conversion or exercise of
options, warrants, and other rights currently outstanding); (j) not issue any
note, bond, or other debt security or create, incur, assume, or guarantee any
indebtedness for borrowed money or capitalized lease obligation outside the
Ordinary Course of Business; (k) not permit the imposition of any lien, security
interest or other encumbrance upon any of its assets outside the Ordinary Course
of Business; (l) not make any capital investment in, make any loan to, or
acquire the securities or assets of any other Person outside the Ordinary Course
of Business; (m) not make any change in employment terms for any of its
directors, officers, and employees outside the Ordinary Course of Business; (n)
not, without the prior written consent of the ▇▇▇▇▇▇ Companies, take any action
or engage in any transaction not expressly permitted by this Section 6.1 or
otherwise contemplated by this Agreement which would cause any of the
representations and warranties made by Arista or Curcura herein to be untrue as
of the Closing Date or a breach of the terms and conditions of this Agreement
and (o) take all actions required of it pursuant to this Agreement.
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5.2. Access and Information. Arista will afford the ▇▇▇▇▇▇
Companies and their employees, accountants, counsel and other authorized
representatives reasonable access to Arista's properties, employees, books and
records and Arista will furnish to the ▇▇▇▇▇▇ Companies and their
representatives all additional financial and operating data and other
information as to Arista as the ▇▇▇▇▇▇ Companies may from time to time
reasonably request.
5.3. Publicity; Confidentiality. Arista and Curcura will not,
without the consent of the ▇▇▇▇▇▇ Companies, issue or cause the publication of
any press release or other public announcement with respect to this Agreement
after the date hereof, except where such release or announcement is required by
law.
5.4. Best Efforts. Arista and Curcura agree to use their best
efforts to satisfy the conditions to the obligations of the ▇▇▇▇▇▇ Companies
hereunder set forth in Section 8.
5.5. Negotiations with Other Parties. Neither Arista nor
Curcura will participate in any negotiations with any third party for the
acquisition of all or any part of the equity or assets of Arista prior to the
Closing or the termination of this Agreement pursuant to Section 11. Arista will
report to the ▇▇▇▇▇▇ Companies any contacts or indications of interest from any
third party with respect to such possible acquisition.
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5.6. Public Offering. Curcura acknowledges that following the
Closing the Parties expect to file a Registration Statement on Form S-1 with the
Securities and Exchange Commission for an initial public offering of Arista's
common stock. In connection with such public offering, Curcura agrees to execute
such documents and take such actions as may reasonably be requested by the
underwriters.
5.7. Loans by Curcura to Arista. With respect to amounts lent
by Curcura to Arista, which amounts are stipulated and agreed to be $632,933 as
of March 31, 1998, less any amounts withdrawn by Curcura from Arista (other than
expenses) in excess of his salary of $30,000 per month from April 1, 1998
through the Closing Date (the "Curcura Loan"), Arista will repay the Curcura
Loan upon demand therefor.
6. Covenants of the ▇▇▇▇▇▇ Companies. The ▇▇▇▇▇▇ Companies covenant
as follows:
6.1. Publicity; Confidentiality. The ▇▇▇▇▇▇ Companies will
not, without the consent of Arista, issue or cause the publication of any press
release or other public announcement with respect to this Agreement after the
date hereof, except where such release or announcement is required by law.
6.2. Best Efforts. The ▇▇▇▇▇▇ Companies will use their best
efforts to satisfy the conditions to the obligations of Arista and Curcura
hereunder set forth in Section 7.
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7. Conditions to the Obligations of Arista and Curcura. The
obligations of Arista and Curcura to effect the transactions contemplated hereby
are subject to the fulfillment to their satisfaction prior to or at the Closing
of the following conditions:
7.1. Representations and Warranties. The representations and
warranties of the ▇▇▇▇▇▇ Companies contained herein are true and correct when
made and shall be true and correct in all material respects at and as of the
Closing as though such representations and warranties were made at and as of the
Closing.
7.2. Performance. The ▇▇▇▇▇▇ Companies shall have performed
and complied with each covenant and condition required by this Agreement to be
performed or complied with by it before or at the Closing.
7.3. Closing Certificate. The ▇▇▇▇▇▇ Companies shall have
delivered to Arista and Curcura a certificate, dated the Closing Date and
executed by a principal executive officer of each of the ▇▇▇▇▇▇ Companies,
certifying that the conditions specified in Sections 7.1 and 7.2 have been
fulfilled.
7.4. Opinion of Counsel. Arista and Curcura shall have
received from Patterson, Belknap, ▇▇▇▇ & ▇▇▇▇▇ LLP, counsel for the ▇▇▇▇▇▇
Companies, an opinion, dated the Closing Date, addressed to Arista and Curcura
and in substantially the form of Exhibit B.
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7.5. ▇▇▇▇▇ Representation Letter. Arista and Curcura shall
have received from ▇▇▇▇▇ ▇▇▇▇▇, the sole stockholder of ▇▇▇▇▇ Transfer, a
representation letter in substantially the form of Exhibit C.
8. Conditions to the Obligations of the ▇▇▇▇▇▇ Companies. The
obligations of the ▇▇▇▇▇▇ Companies to effect the transactions contemplated
hereby are subject to the fulfillment to its satisfaction before or at the
Closing of the following conditions:
8.1. Representations and Warranties. The representations and
warranties of Arista and Curcura contained in this Agreement (including the
Schedules hereto) shall have been true and correct when made and shall be true
and correct in all material respects at and as of the Closing as though such
representations and warranties were made at and as of the Closing.
8.2. Performance. Arista and Curcura shall have performed and
complied with each covenant and condition required by this Agreement to be
performed or complied with by it or him before or at the Closing.
8.3. Closing Certificate. Arista and Curcura shall have
delivered to the ▇▇▇▇▇▇ Companies a certificate, dated the Closing Date and
executed Curcura, on his own behalf and as a principal executive officer of
Arista, certifying that the conditions specified in Sections 8.1 and 8.2 have
been fulfilled.
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8.4. Opinion of Counsel. The ▇▇▇▇▇▇ Companies shall have
received from ▇▇▇▇▇, Banta, Rizzi, ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, P.C., counsel to
Arista and Curcura, an opinion, dated the Closing Date, addressed to the ▇▇▇▇▇▇
Companies and in substantially the form of Exhibit D.
8.5. Consents; Permits. Arista shall have obtained and the
▇▇▇▇▇▇ Companies shall have received, in form and substance satisfactory to the
▇▇▇▇▇▇ Companies, all consents which are required to consummate the transactions
contemplated hereby or to avoid the termination of any Permit or Contract upon
such consummation (including without limitation waivers of due-on-sale clauses
contained in any contracts and any consents to the change of ownership of the
Arista required under the terms of any Permit or Contract).
8.6. Employment Agreements. The executives of Arista listed as
parties to the Employment Agreements set forth in Exhibit E shall have entered
into employment agreements in substantially the form therein set forth.
8.7. Redomiciliation. Redomiciliation shall have occurred.
8.8. Subscription Agreements. Arista shall have received
Subscription Agreements from the ▇▇▇▇▇▇ Stockholders or their representatives
holding such number of ▇▇▇▇▇▇ Shares in each of the Nelson Companies so that
Arista's acquisition of ▇▇▇▇▇▇ Shares of each of the Nelson Companies can be
accounted for as a pooling of interests.
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8.9. Pooling Letter. Curcura, as sole stockholder of Arista,
shall have executed a letter, dated as of the Closing Date, in the form of
Exhibit F attached hereto.
8.10. Ability to File Registration Statement. Either (a)
Arista shall have provided the necessary financial information for 1993 and
1994, or (b) the Securities and Exchange Commission shall have confirmed to the
▇▇▇▇▇▇ Companies that a Registration Statement may be filed by Arista without
inclusion of 1993 and 1994 financial information of Arista and that the absence
of such financial information from the Registration Statement shall not act as
an impediment to such Registration Statement becoming effective under the
Securities Act or materially delay such effectiveness.
9. Adoption of Plans of Certain ▇▇▇▇▇▇ Companies' Subsidiaries. (a)
Effective on the Closing Date, Arista will assume the Stock Incentive Plan of
NCI Advertising, Inc., which was formerly known as the RWR Advertising, Inc.
Stock Incentive Plan (the "Advertising Stock Option Plan"), and the World Health
Communications, Inc. Stock Incentive Plan (the "WHC Stock Option Plan").
Effective on the Closing Date, all unexercised and unexpired options grants
under the Advertising Stock Option Plan and the WHC Stock Option Plan shall be
converted into and represent the right to acquire Arista Shares and shall be
adjusted as is reasonable and appropriate. Notwithstanding the foregoing, any
such adjustment in outstanding options shall be
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made without changing the aggregate exercise price applicable to the unexercised
portions of such options and shall be made in such a manner as to comply with
all applicable provisions of the Code.
(b) Subsequent to the Closing Date but prior to the contemplated
initial public offering of Arista Shares, subject to shareholder approval,
Arista will establish a new stock option plan (the "Arista Stock Option Plan")
which shall provide for the grant of (i) options that are intended to qualify as
incentive stock options within the meaning of Section 422 of the Code to
officers and key employees of Arista and its subsidiaries, and (ii) options that
are not intended to so qualify to directors, officers and key employees of
Arista and its subsidiaries. Arista shall use its best efforts to obtain
shareholder approval of the Arista Stock Option Plan prior to such initial
public offering.
10. Survival of Representations and Warranties; Indemnification.
10.1. Survival of Representations and Warranties. The
representations and warranties contained in Sections 3, 4 and 5 of this
Agreement shall survive any investigation by any Party and the Closing but shall
expire and be extinguished on the first anniversary of the Closing Date, except
that Arista's and Curcura's representations and warranties set forth in (a)
Sections 3.18 and 3.20 shall survive until 90 days after expiration of the
applicable statute of limitations for any
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affected taxable period, and (b) Section 3.5 shall survive until 90 days after
expiration of the applicable statute of limitations. No action for
indemnification under this Section 10 may be brought with respect to such
representations and warranties after the applicable date indicated in the
preceding sentence unless, before the date such representations and warranties
expire, the party seeking indemnification has notified in reasonable detail the
party from whom indemnification is sought of a claim for indemnity hereunder.
10.2. Indemnification by Curcura. Subject to Section 10.1,
from and after the Closing, Curcura agrees to indemnify and defend the ▇▇▇▇▇▇
Companies and ▇▇▇▇▇ Transfer, and hold the ▇▇▇▇▇▇ Companies and ▇▇▇▇▇ Transfer
harmless from and against, any out-of-pocket loss, liability, damage, penalty,
claim or expense (including reasonable attorneys' and consultants' fees and
other costs and expenses) (collectively, "Damages") incurred or sustained by the
▇▇▇▇▇▇ Companies or Arista as a result of or relating to:
(a) the non-fulfillment or breach of any covenant or
agreement or the breach of any representation or warranty of Arista or Curcura
set forth in this Agreement;
(b) any investigation, claim, lawsuit, arbitration, or
regulatory or administrative suit, proceeding, order or action relating to, or
arising out of, any acts, omissions or activities of Arista before the Closing
Date, whether or not disclosed herein or in the Schedules hereto; and
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(c) the Fry Arbitration.
10.3. Indemnification by the ▇▇▇▇▇▇ Companies. Subject to
Section 10.1, from and after the Closing, the ▇▇▇▇▇▇ Companies agree, jointly
and severally to indemnify Curcura, and hold Curcura harmless from and against,
damages incurred or sustained by Curcura as a result of or relating to:
(a) the non-fulfillment or breach of any covenant or
agreement or the breach of any representation or warranty of the ▇▇▇▇▇▇
Companies set forth in this Agreement; and
(b) any investigation, claim, lawsuit, arbitration, or
regulatory or administrative suit, proceeding, order or action relating to, or
arising out of, any acts, omissions or activities of the ▇▇▇▇▇▇ Companies before
the Closing Date, whether or not disclosed herein or in the Schedules hereto.
10.4. Limit of Indemnification Obligations. The
indemnification obligations the Parties hereunder shall be subject to the
following terms and limitations:
(a) Except for indemnification for Damages incurred or
sustained as the result of the matter referred to in Section 10.2(c), no claim
for indemnification shall be made and no compensation therefor shall be due with
respect to the first $25,000 of Damages (the "Deductible Amount") incurred by
the Party incurring or sustaining such Damage. In the case of Curcura only, the
Deductible Amount shall be $25,000 plus the amount ("Found Assets") of cash or
each equivalents realized by
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Arista during the longest period set forth in Section 10.1 and not shown on the
Balance Sheet of Arista as of the Closing Date, but excluding any recoveries on
bad receivables previously charged to the bad debt reserves. In calculating the
amount due from Curcura under this Section 10, only the amount of Found Assets
established at the time payment is due shall be taken into account.
(b) Any indemnification due from Curcura shall be paid
by Curcura returning to Arista such number of Arista Shares as shall equal the
amount of indemnification due. For the purposes of indemnification, it is agreed
that the value of the 727,273 Arista Shares to be owned by Curcura from and
after the Closing Date is $3,794,000, which is the amount shown on the valuation
findings of Veronis, Suhler & Associates Inc. appended to the Private Placement
Memorandum referred to in Section 2.3(b).
(c) Nothing in this Section 10 shall be construed to
require Curcura to return to Arista more than 145,455 Arista Shares, provided,
however, that any liability of Arista resulting from the arbitration with ▇▇▇▇▇
▇. ▇▇▇ and The Peer Group, Inc. shall not be subject to this limitation and any
Arista Shares returned by Curcura to compensate Arista for any such liability
shall not be counted against such limitation.
(d) Except with respect to Curcura's indemnification of
the ▇▇▇▇▇▇ Companies and ▇▇▇▇▇ Transfer pursuant to Section 10.2(c) with respect
to the Fry Arbitration,
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Curcura's indemnification obligations hereunder shall be limited to 40 percent
of any Damages incurred or sustained by the ▇▇▇▇▇▇ Companies in excess of the
amount referred to in Section 10.4(a) for which indemnification is payable
hereunder.
(e) Curcura shall have no liability for the first
$15,000 of legal fees incurred by Arista with respect to the Fry Arbitration.
10.5. Indemnification Procedures. A party entitled to
indemnification hereunder shall herein be referred to as an "Indemnitee." A
party obligated to indemnify an Indemnitee hereunder shall herein be referred to
as an "Indemnitor." Promptly after receipt by an Indemnitee of notice of any
claim or the commencement of any action, or upon discovery of any facts which an
Indemnitee believes may give rise to a claim for indemnification from an
Indemnitor hereunder, such Indemnitee shall, if a claim in respect thereof is to
be made against an Indemnitor under this Section 10, notify such Indemnitor in
writing in reasonable detail of the claim or the commencement of such action. If
any such claim shall be brought against such Indemnitee, it shall notify such
Indemnitor thereof, the Indemnitor shall be entitled to participate therein, and
to assume the defense thereof with counsel reasonably satisfactory to the
Indemnitee, and to settle or compromise any such claim or action; provided,
however, that any such settlement or compromise shall be effected only with the
consent of the Indemnitee, which consent shall not be unreasonably withheld; and
provided further,
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that if the Indemnitee rejects a settlement that would have included a complete
release of the Indemnitee from any further liability, its right to
indemnification from the Indemnitor shall be limited to the amount that would
have been payable by the Indemnitor under such settlement or compromise. After
notice to the Indemnitee of the Indemnitor's election to assume the defense of
such claim or action, the Indemnitor shall not be liable to the Indemnitee under
this Section 10 for any legal or other expenses subsequently incurred by the
Indemnitee in connection with the defense thereof; provided, however, that the
Indemnitee shall have the right to employ counsel to represent it if, in the
Indemnitee's reasonable judgment, it is advisable for the Indemnitee to be
represented by separate counsel, and in that event the fees and expenses of such
separate counsel shall be paid by the Indemnitee. If the Indemnitor does not
elect to assume the defense of such claim or action, the Indemnitee shall act
reasonably and in accordance with its good faith business judgment with respect
thereto, and shall not settle or compromise any such claim or action without the
consent of the Indemnitor, which consent shall not be unreasonably withheld. The
parties hereto agree to render to each other such assistance as may reasonably
be requested in order in insure the proper and adequate defense of any such
claim or proceeding.
10.6. Waiver of Right to Contribution. Curcura hereby waives,
effective as of the Closing Date, any right which he may have against Arista in
connection with any contribution or
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indemnification for payments made after the Closing Date pursuant to this
Agreement or otherwise.
11. Termination. (a) This Agreement may be terminated by the ▇▇▇▇▇▇
Companies, on the one hand, or Arista and Curcura, on the other hand:
(i) by mutual consent;
(ii) by either, if there has been a material breach on
the part of the other in any representation or warranty or covenant set forth in
or made pursuant to this Agreement; or
(iii) by either, if the Closing has not occurred by July
31, 1998 no fault of the terminating party.
(b) A termination pursuant to Section 11(a)(ii) shall not
relieve the breaching party from liability for such breach.
12. General Provisions.
12.1. Modification; Waiver. This Agreement may be modified
only by a written instrument executed by the Parties. Any of the terms and
conditions of this Agreement may be waived in writing at any time on or before
the Closing Date by the party entitled to the benefits thereof.
12.2. Entire Agreement, etc. This Agreement, together with the
schedules and exhibits hereto, constitutes the entire agreement among the
parties pertaining to the subject matter hereof and supersedes all prior
agreements and understandings of the parties in connection therewith.
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12.3. Curcura's Consent. By execution of this Agreement by
Curcura, Arista hereby acts by consent of its sole stockholder to approve this
Agreement and the transactions contemplated hereby.
12.4. Expenses. Whether or not the transactions contemplated
herein shall be consummated, except as provided herein each party shall pay its
own expenses incident to the preparation and performance of this Agreement. In
addition, Arista will pay, following the Closing Date, the fees of ▇▇▇▇▇ ▇▇▇▇▇▇
LLP for preparing financial statements in accordance with GAAP, of Deloitte &
Touche LLP, for preparing audited financial statements and a portion of the fees
of Patterson, Belknap, ▇▇▇▇ & Tyler LLP for Redomiciliation and preparing the
Private Placement Memorandum.
12.5. Further Actions. Each party shall execute and deliver
such certificates, agreements and other documents and take such other actions as
may reasonably be requested by the other parties in order to consummate or
implement the transactions contemplated hereby.
12.6. Notices. All notices, requests, demands, and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if delivered or mailed, registered mail, first-class postage paid,
return receipt requested, or any other delivery service with proof of delivery:
(a) If to Arista or Curcura:
Arista Marketing Associates, Inc.
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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Clark, New Jersey 07066-1640
Attention: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
President
with a copy to:
▇▇▇▇▇, Banta, Rizzi, ▇▇▇▇▇▇▇▇▇▇▇▇ &
Basralian, P.C.
Court Plaza North
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
(b) If to the ▇▇▇▇▇▇ Companies:
▇▇▇▇▇▇ Communications, Inc.
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
President and Chief Executive
Officer
with a copy to:
Patterson, Belknap, ▇▇▇▇ & Tyler LLP
1133 Avenue of the Americas
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
or to such other address or to such other persons as the Parties shall have last
designated by notice to the other Parties.
12.7. Assignment. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns, but shall not be assignable, by operation of law or
otherwise, by any party hereto without the prior written consent of the other
parties.
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12.8. Counterparts. This Agreement may be executed in several
counterparts, each of which is an original but all of which shall constitute one
instrument.
12.9. Headings. The Section headings in this Agreement are for
convenience of reference only and shall not be deemed to alter or affect the
meaning or interpretation of any provision hereof.
12.10. Governing Law. The validity, performance and
enforcement of this Agreement shall be governed by the laws of the State if New
York without giving effect to the principles of conflicts of law thereof.
12.11. Separability. Any term or provision of this Agreement
which is invalid or unenforceable shall be ineffective to the extent of such
invalidity or unenforceability without rendering invalid or unenforceable the
remaining terms and provisions of this Agreement.
12.12. Incorporation of Exhibits and Schedules. The Exhibits
and Schedules identified in this Agreement are incorporated herein by reference
and made a part hereof.
12.13. Submission to Jurisdiction. Each of the Parties submits
to the jurisdiction of any state or federal court sitting in New York, New York,
in any action or proceeding arising out of or relating to this Agreement and
agrees that all claims in respect of the action or proceeding may be heard and
determined in any such court. Each of the Parties also agrees not to bring any
action or proceeding arising out of or relating
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to this Agreement in any other court. Each of the Parties waives any defense of
inconvenient forum to the maintenance of any action or proceeding so brought and
waives any bond, surety, or other security that might be required of any other
Party with respect thereto. Any Party may make service on any other Party by
sending or delivering a copy of the process (i) to the Party to be served at the
address and in the manner provided for the giving of notices in Section 12.6
above or (ii) to the party to be served in care of the Process Agent at the
address and in the manner provided for the giving of notices in Section 11.6
above. Nothing in this Section 12.13, however, shall affect the right of any
Party to serve legal process in any other manner permitted by law or at equity.
Each Party agrees that a final judgment in any action or proceeding so brought
shall be conclusive and may be enforced by suit on the judgment or in any other
manner provided by law or at equity.
12.14. Notice of Developments. Each Party will give prompt
written notice to the others of any material adverse development causing a
breach of any of its own representations and warranties in Sections 3, 4 or 5
above. No disclosure by any Party pursuant to this Section 12.14, however, shall
be deemed to amend or supplement the Schedules hereto or to prevent or cure any
misrepresentation, breach of warranty, or breach of covenant.
[REST OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to
be executed as of the date first above written.
ARISTA MARKETING ASSOCIATES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------
Name:
Title:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------------
▇▇▇▇▇ TRANSFER CORP.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
THE ▇▇▇▇▇▇ COMPANIES:
BIENESTAR COMMUNICATIONS, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
ISSUESPHERE, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
MADISON GRAPHICS, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
62
MEDISCIENCE ASSOCIATES, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
MEDISOLUTIONS, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
MEDISPHERE COMMUNICATIONS, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
NCI ADVERTISING, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
NCI CONSULTING, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
NCI DIRECT, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
NCI HEALTHCALL NETWORK, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
63
NCI MANAGED CARE, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
NCI ▇▇▇▇▇▇▇▇▇ ADVERTISING, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
▇▇▇▇▇▇ COMMUNICATIONS INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
PHARMA COMMUNICATIONS, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
PRINCETON GRAPHICS CORPORATION
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
PROFESSIONAL DETAILING NETWORK, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
SCIENS WORLDWIDE ADVERTISING, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
----------------------------------------
Name:
Title:
64
SCIENS WORLDWIDE PUBLIC RELATIONS, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
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Name:
Title:
SOLUTIONS ON-LINE, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
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Name:
Title:
WORLD HEALTH COMMUNICATIONS, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇-Gisiko
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Name:
Title:
65
EXHIBITS AND SCHEDULES TO CONSOLIDATION AGREEMENT
Pursuant to Item 601(b)(2) of Regulation S-K, ▇▇▇▇▇▇ Communications Inc. agrees
to furnish supplementally a copy of any of the following omitted exhibits or
schedules to the Commission upon request:
Exhibit Description
------- -----------
A Certificate of Incorporation and By-Laws of Arista
Marketing Associates, Inc.
B Form of Opinion of Patterson, Belknap, ▇▇▇▇ & Tyler LLP
C Form of ▇▇▇▇▇ Transfer Corp. Representation Letter
D Form of Opinion of ▇▇▇▇▇, Banta, Rizzi, ▇▇▇▇▇▇▇▇▇▇▇▇ &
Basralian, P.C.
E Employment Agreement
F Pooling Letter
Schedule Description
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3.4 Agreements, Contracts, Leases, etc. requiring Consent
3.6 Title to Property, Absence of Encumberances, etc.
3.7 Accounts Receivable and Accounts Payable
3.8 Books and Records
3.9 Patents, Trademarks, etc.
3.10 Employee Remuneration, etc.
3.11 Labor Matters
3.12 Bank Accounts
3.14 Absence of Certain Changes
3.15 Litigation
3.17 Contracts
3.18 Taxes
3.19 Permits
3.20 Employee Benefits Plans
3.21 Insurance
3.22 Transactions with Affiliates
3.23 Clients
3.24 Information Technology