Common Stock Purchase Agreement - CMG Information Services Inc. and Sumitomo Corp.
COMMON STOCK PURCHASE AGREEMENT
This Common Stock Purchase Agreement (this "Agreement") is made and entered
into as of February 15, 1998, by and between:
CMG INFORMATION SERVICES, INC., a corporation duly organized and existing
under the laws of the State of Delaware, United States of America and having its
principal place of business at 100 Brickstone Square First Floor Andover,
Massachusetts 01810, United States of America ("CMG"); and
SUMITOMO CORPORATION, a corporation duly organized and existing under the
laws of Japan and having its principal place of business at 2-2, Hitotsubashi
1-chome, Chiyoda-ku, Tokyo, Japan (the "Purchaser").
RECITALS
WHEREAS, CMG desires to sell to the Purchaser, and the Purchaser desires to
purchase from CMG, a number of shares of Common Stock, all on the terms and
conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the foregoing recitals, the mutual
promises hereinafter set forth and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. AGREEMENT TO PURCHASE AND SELL STOCK.
1.1 Authorization. CMG's Board of Directors has authorized the issuance
of the CMG Shares (as defined below) pursuant to the terms and conditions of
this Agreement.
1.2 Agreement to Purchase and Sell Common Stock. At the Closing (as
defined below), CMG hereby agrees to sell to the Purchaser and the Purchaser
agrees to purchase from CMG that number of shares of Common Stock of CMG, $0.01
par value per share (the "CMG Shares"), having a value of US$10,000,000, such
shares of CMG's common stock being valued at the lower of (i) the average of the
closing prices of CMG's common stock over the 20 trading day period ending on
the trading day immediately prior to the date of signature of this Agreement,
(ii) the average of the closing prices of CMG's common stock over the 20 trading
day period ending on the trading day immediately prior to the issuance of a
press release announcing the transaction, or (iii) the average of the closing
prices of CMG's common stock over the 20 trading day period ending on the
trading day immediately prior to the date of signature of the Letter Agreement
between the parties dated February 2, 1998 (the
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"Letter Agreement"), each such price being publicly reported for the NASDAQ
Stock Market as of 5:15 P.M. Eastern Time.
2. CLOSING.
2.1. The Closing. The purchase and sale of the CMG Shares shall take
place at the offices of Palmer & Dodge LLP, One Beacon Street, Boston,
Massachusetts 02108, at 10:00 a.m. Massachusetts time, within three (3) business
days after the conditions set forth in Articles 5 and 6 have been satisfied, or
at such other time and place as CMG and the Purchaser mutually agree upon (which
time and place are referred to in this Agreement as the "Closing"). At the
Closing, CMG will deliver to the Purchaser certificates representing the CMG
Shares, all against delivery to CMG by the Purchaser of the consideration set
forth in Section 1.2 by wire transfer of funds to an account designated by CMG
at least two business days prior to the Closing. It is expected that Closing
documents will be delivered by facsimile with original signature pages sent by
overnight courier.
3. REPRESENTATIONS AND WARRANTIES OF CMG. CMG hereby represents and
warrants to the Purchaser, at the date of execution of this Agreement and at the
Closing, that the statements in this Section 3 are true and correct, except as
set forth in the Disclosure Letter from CMG dated February 15, 1998 (the
"Disclosure Letter") or disclosed in the SEC Documents (as defined below):
3.1 Organization Good Standing and Qualification. CMG is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Delaware, United States of America and has all corporate power and
authority required to (a) carry on its business as presently conducted, and (b)
enter into this Agreement and to consummate the transactions contemplated
hereby. CMG is qualified to do business and is in good standing in each
jurisdiction in which the failure to so qualify would have a Material Adverse
Effect. As used in this Agreement, "Material Adverse Effect" means a material
adverse effect on, or a material adverse change in, or a group of such effects
on or changes in, the business, operations, financial condition, results of
operations, prospects, assets or liabilities of CMG and its Subsidiaries (as
defined below), taken as a whole.
3.2 Capitalization. The authorized stock of CMG consists of 40,000,000
shares of Common Stock, par value $.01 per share ("Common Stock") of which
10,293,441 shares were issued and outstanding as of February 15, 1998 and
5,000,000 shares of Preferred Stock, $.01 par value ("Preferred Stock"). No
shares of Preferred Stock are issued or outstanding. All outstanding shares
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have been duly authorized, validly issued, are fully paid and nonassessable and
are free of any liens or encumbrances other than any liens or encumbrances
created by or imposed upon the holders thereof. As of January 31, 1998, CMG has
also reserved 1,731,582 shares of Common Stock for issuance to officers,
directors, employees or independent contractors or affiliates of CMG under CMG's
employee benefit plans. As of January 31, 1998, of the 1,731,582 shares of
Common Stock reserved for issuance upon exercise of options and similar rights,
1,113,623 shares remained subject to outstanding options with a weighted average
exercise price of approximately $8.00 and 617,959 shares were reserved for
future grants. All shares of Common Stock subject to issuance as aforesaid, upon
issuance on the terms and conditions specified in the instruments pursuant to
which they are issuable, shall be duly authorized, validly issued, fully paid
and nonassessable. There are no other equity securities, convertible securities,
options, warrants, calls, rights, commitments or agreements of any character to
which CMG is a party or by which it is bound obligating CMG to issue, deliver,
sell, repurchase or redeem, or cause to be issued, delivered, sold, repurchased
or redeemed, any shares of the capital stock of CMG or obligating CMG to grant,
extend or enter into any such equity security, convertible security, option,
warrant, call, right, commitment or agreement.
3.3 Due Authorization. All corporate action on the part of CMG, its
officers, directors and stockholders necessary for the authorization, execution,
delivery of, and the performance of all obligations of CMG under this Agreement
and the authorization, issuance, reservation for issuance and delivery of all
of the CMG Shares being sold under this Agreement has been taken or will be
taken prior to the Closing, and this Agreement constitutes a valid and legally
binding obligation of CMG, enforceable against CMG in accordance with its terms,
except as may be limited by (i) applicable bankruptcy, insolvency,
reorganization or others laws of general application relating to or affecting
the enforcement of creditors' rights generally and (ii) the effect of rules of
law governing the availability of equitable remedies.
3.4 Valid Issuance of Stock.
(a) Valid Issuance. The CMG Shares, when issued, sold and delivered in
accordance with the terms of this Agreement for the consideration provided for
herein, will be duly and validly issued, fully paid and nonassessable.
(b) Compliance with Securities Laws. Assuming the correctness of the
representations made by the Purchaser in Section 4 hereof, the CMG Shares will
be issued in full compliance with the registration and prospectus delivery
requirements of the Securities Act of 1933, as amended (the "Securities Act"),
or in compliance with applicable exemptions therefrom, and the registration and
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qualification requirements of all applicable securities laws of the states of
the United States.
3.5. Subsidiaries and Affiliates.
(a) The Disclosure Letter sets forth a list of all entities in which CMG
beneficially owns, directly or indirectly, 50% or more of the outstanding stock
or other equity interests (collectively, the "Subsidiaries"). The Disclosure
Letter also includes (i) a complete list of each partnership or joint venture
agreement or arrangement to which CMG is party and the nature and amount of the
interest of CMG in such entities and (ii) a complete list of the corporations,
partnerships, limited liability companies or other entities with respect to
which CMG beneficially owns, directly or indirectly, the outstanding stock or
other equity interests and the percentage ownership of such entity by CMG.
Except as set forth in the Disclosure Letter or the SEC Documents (as
hereinafter defined), there is no other entity with respect to which: (i) CMG
beneficially owns, directly or indirectly, any outstanding stock or other
ownership interests of such entity; (ii) CMG may be deemed to be in control
because of factors or relationships other than the quantity of stock or other
interests owned; (iii) CMG may be liable under any circumstances for the payment
of additional amounts with respect to its interest, whether in the form of
assessments, capital calls, installment payments, general partner liability or
otherwise; or (iv) the investment by CMG is accounted for by the equity method.
(b) All capital stock or other equity interests owned by CMG as described
pursuant to Section 3.5(a) are owned by CMG or its Subsidiaries, as the case may
be, as record and beneficial owner thereof free and clear of all liens, charges,
encumbrances, equities and claims whatsoever. There is no outstanding or
authorized option, subscription, warrant, call, right, commitment or other
agreement of any character obligating CMG to issue, sell, transfer, pledge or
otherwise encumber any share of capital stock or other equity interest described
pursuant to Section 3.5(a) or any security or other instrument convertible into
or exercisable for or evidencing the right to subscribe for any such share of
capital stock or other equity interest.
(c) Each Subsidiary is a corporation duly organized, validly existing and
in good standing under the laws of its state of organization. Each Subsidiary is
duly qualified to do business as a foreign corporation and is in good standing
in every jurisdiction in which the nature of the business conducted by it or the
character or location of the properties owned or leased by it makes such
qualification necessary, except where the failure to be so qualified would not
have a Material Adverse Effect. Each Subsidiary has all requisite corporate
power and authority to own or lease and operate its properties and assets and to
carry on its business as now conducted.
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3.6 Governmental Consents. No consent, approval, order or authorization
of, or registration qualification, designation, declaration or filing with, any
federal, state or local governmental authority on the part of CMG is required in
connection with the consummation of the transactions contemplated by this
Agreement except the filing of such qualifications or filings under the
Securities Act and the Exchange Act (as defined below) and the regulations
thereunder and all applicable state securities laws as may be required in
connection with the transactions contemplated by this Agreement. All such
qualifications and filings will, in the case of qualifications, be effective on
the Closing and will, in the case of filings, be made within the time prescribed
by law.
3.7 Non-Contravention. The execution, delivery and performance of this
Agreement by CMG and the consummation by CMG of the transactions contemplated
hereby do not and will not (i) contravene or conflict with the Certificate of
Incorporation or Bylaws of CMG; (ii) constitute a violation of any provision of
any federal, state, local or foreign law binding upon or applicable to CMG; or
(iii) constitute a default or require any consent under, give rise to any right
of termination, cancellation or acceleration of, or to a loss of any benefit to
which CMG is entitled under, or result in the creation or imposition of any
lien, claim or encumbrance on any assets of CMG under, any contract to which CMG
is a party or any permit, license or similar right relating to CMG or by which
CMG may be bound or affected in such a manner as, together with all other such
matters, would have Material Adverse Effect.
3.8 Litigation. There is no action, suit, proceeding, claim, arbitration
or investigation ("Action") pending: (a) against CMG or its Subsidiaries, their
respective activities, properties or assets or, to the best of CMG's knowledge,
against any officer, director or employee of CMG in connection with such
officer's, director's or employee's relationship with, or actions taken on
behalf of, CMG which CMG believes is reasonably likely to have a Material
Adverse Effect, or (b) that seeks to prevent, enjoin, alter or delay the
transactions contemplated by this Agreement. CMG is not a party to or subject to
the provisions of any order, writ, injunction, judgment or decree of any court
or government agency or instrumentality. No Action by CMG is currently pending
nor does CMG intend to initiate any Action which is reasonably likely to have a
Material Adverse Effect.
3.9 Compliance with Law and Charter Documents. CMG is not in violation or
default of any provisions of its Certificate of Incorporation or Bylaws, both as
amended. CMG and its Subsidiaries have complied and are in compliance with all
applicable statutes, laws, and regulations and executive orders of the United
States of America and all states, foreign countries and other governmental
bodies and agencies having jurisdiction over CMG's and its Subsidiaries'
businesses or
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properties, except for any violations that would not, either individually or in
the aggregate, have a Material Adverse Effect.
3.10 SEC Documents.
(a) Reports. CMG has furnished to the Purchaser prior to the date hereof
copies of its Annual Report on Form 10-K for the fiscal year ended July 31, 1997
("Form 10-K"), its Quarterly Reports on Form 10-Q for the fiscal quarter ended
October 31, 1997 (the "Form 10-Q"), and all other registration statements,
reports and proxy statements filed by CMG with the Securities and Exchange
Commission ("SEC") on or after July 31, 1996 (the Form 10-K, the Form 10-Q and
such registration statements, reports and proxy statements, are collectively
referred to herein as the "SEC Documents"). Each of the SEC Documents, as of the
respective date thereof (or if amended or superseded by a filing prior to the
date of this Agreement, then on the date of such filing), did not, and each of
the registration statements, reports and proxy statements filed by CMG with the
SEC after the date hereof and prior to the Closing will not, as of the date
thereof (or if amended or superseded by a filing prior to the date of this
Agreement, then on the date of such filing), contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements made therein, in light of the circumstances under which they were
made, not misleading. CMG is not a party to any material contract, agreement or
other arrangement which was required to have been filed as an exhibit to the SEC
Documents that is not so filed.
(b) Financial Statements. CMG has provided the Purchaser with copies of
its audited financial statements (the "Audited Financial Statements") for the
fiscal year ended July 31, 1997, and its unaudited financial statements for the
three-month period ended October 31, 1997 (the "Balance Sheet Date"). Since
the Balance Sheet Date, CMG has duly filed with the SEC all registration
statements reports and proxy statements required to be filed by it under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the
Securities Act. The audited and unaudited consolidated financial statements of
CMG included in the SEC Documents filed prior to the date hereof fairly present,
in conformity with generally accepted accounting principles ("GAAP") (except as
permitted by Form 10-Q) applied on a consistent basis (except as may be
indicated in the notes thereto), the consolidated financial position of CMG and
its consolidated subsidiaries as at the dates thereof and the consolidated
results of their operations and cash flows for the periods then ended (subject
to normal year end audit adjustments in the case of unaudited interim financial
statements).
3.11 Absence of Certain Changes Since Balance Sheet Date. Since the
Balance Sheet Date, the business and operations of CMG and its Subsidiaries have
been conducted in the ordinary
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course consistent with past practice, and there has not been:
(a) any declaration, setting aside or payment of any dividend or other
distribution of the assets of CMG with respect to any shares of capital stock of
CMG or any repurchase, redemption or other acquisition by CMG or any Subsidiary
of CMG of any outstanding shares of CMG's capital stock;
(b) any damage, destruction or loss, whether or not covered by insurance,
except for such occurrences that have not resulted, and are not expected to
result, in a Material Adverse Effect;
(c) any waiver by CMG or a Subsidiary of a valuable right or of a material
debt owed to it, except for such waivers that have not resulted and are not
expected to result, in a Material Adverse Effect;
(d) any material change or amendment to, or any waiver of any material
rights under a material contract or arrangement by which CMG or a Subsidiary or
any of its respective assets or properties is bound or subject, except for
changes, amendments, or waivers that are expressly provided for or disclosed in
this Agreement or that have not resulted, and are not expected to result, in a
Material Adverse Effect;
(e) any change by CMG in its accounting principles, methods or practices or
in the manner it keeps its accounting books and records, except any such change
required by a change in GAAP; and
(f) any other event or condition of any character, except for such events
and conditions that have not resulted, and are not expected to result, either
individually or collectively, in a Material Adverse Effect.
3.12 Full Disclosure. The information contained in this Agreement, the
Disclosure Letter and the SEC Documents with respect to the business,
operations, assets, results of operations and financial condition of CMG and its
Subsidiaries, and the transactions contemplated by this Agreement are true and
complete in all material respects and do not omit to state any material fact
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading.
4. REPRESENTATIONS, WARRANTIES AND CERTAIN AGREEMENTS OF THE PURCHASER.
The Purchaser hereby represents and warrants to CMG, at the date of execution of
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this Agreement and at the Closing, and agrees that:
4.1 Organization Good Standing and Qualification. The Purchaser is a
corporation duly organized, validly existing and in good standing under the laws
of Japan and has all corporate power and authority required to (a) carry on its
business as presently conducted, and (b) enter into this Agreement and to
consummate the transactions contemplated hereby.
4.2 Authorization. This Agreement has been duly authorized by all
necessary corporate action on the part of the Purchaser. This Agreement
constitutes the Purchaser's valid and legally binding obligation, enforceable in
accordance with its terms, except as enforceability may be limited by (a)
applicable bankruptcy, insolvency, reorganization or other laws of general
application relating to or affecting the enforcement of creditors' rights
generally and (b) the effect of rules of law governing the availability of
equitable remedies. The Purchaser has full corporate power and authority to
enter into this Agreement.
4.3 Governmental Consents. No consent, approval, order or authorization
of, or registration qualification, designation, declaration or filing with, any
governmental authority on the part of the Purchaser is required in connection
with the consummation of the transactions contemplated by this Agreement, except
for such authorizations of the relevant authorities under all applicable laws of
Japan as may be required in connection with the transactions contemplated by
this Agreement. All such authorizations, qualifications and filings will, in the
case of authorizations and qualifications, be effective on the Closing and will,
in the case of filings, be made within the time prescribed by law.
4.5 Purchase for Own Account. The CMG Shares are being acquired for
investment for the Purchaser's own account, not as a nominee or agent, and not
with a view to the public resale or distribution thereof within the meaning of
the Securities Act, and the Purchaser has no present intention of selling,
granting any participation in, or otherwise distributing the same. The Purchaser
also represents that it has not been formed for the specific purpose of
acquiring the CMG Shares.
4.6 Investment Experience. The Purchaser understands that the purchase of
the CMG Shares involves substantial risk. The Purchaser has experience as an
investor in securities of companies and acknowledges that it is able to fend for
itself, can bear the economic risk of its investment in the CMG Shares and has
such knowledge and experience in financial or business matters that it is
capable of evaluating the merits and risks of this investment in the CMG Shares
and protecting its own interests in connection with this investment.
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4.7 Accredited Investor Status. The Purchaser is an "accredited investor"
within the meaning of Regulation D promulgated under the Securities Act.
4.8 Restricted Securities. The Purchaser understands that the CMG Shares
are characterized as "restricted securities" under the Securities Act, inasmuch
as they are being acquired from CMG in a transaction not involving a public
offering and that under the Securities Act and applicable regulations thereunder
such securities may be resold without registration under the Securities Act only
in certain limited circumstances. The Purchaser is familiar with Rule 144 of the
SEC, as presently in effect, and understands the resale limitations imposed
thereby and by the Securities Act.
4.9 Legends. The Purchaser agrees that the certificates for the CMG
Shares shall bear the following legend in addition to any legend required under
Section 7.4 and Article 8.
"The shares represented by this certificate have not been registered under
the Securities Act of 1933 or with any state securities commission, and may not
be transferred or disposed of by the holder in the absence of a registration
statement which is effective under the Securities Act of 1933 and applicable
state laws and rules, or, unless, immediately prior to the time set for
transfer, such transfer may be effected without violation of the Securities Act
of 1933 and other applicable state laws and rules."
In addition, the Purchaser agrees that CMG may place stop transfer orders with
its transfer agents with respect to such certificates. The appropriate portion
of the legend and the stop transfer orders will be removed promptly upon
delivery to CMG of such satisfactory evidence as reasonably may be required by
CMG, that such legend or stop orders are not required to ensure compliance with
the Securities Act.
5. CONDITIONS TO THE PURCHASER'S OBLIGATIONS AT CLOSING. The obligations
of the Purchaser under Sections l and 2 of this Agreement are subject to the
fulfillment or waiver, on or before the Closing, of each of the following
conditions:
5.1 Representations and Warranties True. Each of the representations and
warranties of CMG contained in Section 3 will be true and correct in all
material respects on and as of the date hereof and on and as of the date of the
Closing, except as set forth in the Disclosure Letter or the SEC Documents, with
the same effect as though such representations and warranties had been made as
of the Closing.
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5.2 Performance. CMG will have performed and complied with all
agreements, obligations and conditions contained in this Agreement that are
required to be performed or complied with by it on or before the Closing and
will have obtained all approvals, consents and qualifications necessary to
complete the purchase and sale described herein.
5.3 Compliance Certificate. CMG will have delivered to the Purchaser at
the Closing a certificate signed on its behalf by its Chief Executive Officer or
Chief Financial Officer certifying (i) that the conditions specified in Sections
5.1 and 5.2 hereof have been fulfilled and (ii) the number of shares of Common
Stock outstanding immediately prior to the Closing.
5.4 Securities Exemptions. The offer and sale of the CMG Shares to the
Purchaser pursuant to this Agreement will be exempt from the registration
requirements of the Securities Act and the registration and/or qualification
requirements of all applicable state securities laws.
5.5 Proceedings and Documents. All corporate and other proceedings in
connection with the transactions contemplated at the Closing and all documents
incident thereto will be reasonably satisfactory in form and substance to the
Purchaser, and the Purchaser will have received all such counterpart originals
and certified or other copies of such documents as it may reasonably request.
Such documents shall include, but not be limited to, the following:
(a) Certified Charter Documents. A copy of (i) the Certificate of
Incorporation certified as of a recent date by the Secretary of State of
Delaware as a complete and correct copy thereof, and (ii) the Bylaws of CMG (as
amended through the date of the Closing) certified by the Assistant Secretary of
CMG as true and correct copies thereof as of the Closing.
(b) Board Resolutions. A copy, certified by the Assistant Secretary of
CMG, of the resolutions of the Board of Directors of CMG providing for the
approval of this Agreement and the issuance of the CMG Shares and the other
matters contemplated hereby.
5.6 Opinion of CompanyCMG Counsel. The Purchaser will have received an
opinion on behalf of CMG, dated as of the date of the Closing, from Palmer &
Dodge LLP, in form and substance reasonably satisfactory to the Purchaser.
5.7 No Material Adverse Effect. Between the date hereof and the Closing,
there shall not have occurred any Material Adverse Effect.
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6. CONDITIONS TO CMG'S OBLIGATIONS AT CLOSING. The obligations of CMG to
the Purchaser under this Agreement are subject to the fulfillment or waiver on
or before the Closing, of each of the following conditions:
6.1 Representations and Warranties True. The representations and
warranties of the Purchaser contained in Section 4 will be true and correct on
and as of the date hereof and on and as of the date of the Closing with the same
effect as though such representations and warranties had been made as of the
Closing.
6.2 Performance. The Purchaser will have performed and complied with all
agreements, obligations and conditions contained in this Agreement that are
required to be performed or complied with by it on or before the Closing and
will have obtained all approvals, consents and qualifications necessary to
complete the purchase and sale described herein.
6.3 Payment of Purchase Price. The Purchaser will have delivered to CMG
the full purchase price of the CMG Shares as specified in Section 1.2.
6.4 Securities Exemptions. The offer and sale of the CMG Shares to the
Purchaser pursuant to this Agreement will be exempt from the registration
requirements of the Securities Act and the registration and/or qualification
requirements of all applicable state securities laws.
6.5 Proceedings and Documents. All corporate and other proceedings in
connection with the transactions contemplated at the Closing and all documents
incident thereto will be reasonably satisfactory in form and substance to CMG
and to CMG's legal counsel, and CMG will have received all such counterpart
originals and certified or other copies of such documents as it may reasonably
request.
7. COVENANTS AND AGREEMENTS OF THE PARTIES.
7.1 Information Rights.
(a) Financial Information. CMG covenants and agrees that, commencing on
the Closing and continuing for so long as the Purchaser or a Majority-Owned
Subsidiary (as defined below) of Purchaser owns at least 50% of the CMG Shares
(as adjusted for stock splits, stock
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dividends, and similar events), CMG shall:
(i) Annual Reports. Furnish to the Purchaser promptly following the filing
of such report with the SEC a copy of CMG's Annual Report on Form 10-K for each
fiscal year, which shall include a consolidated balance sheet as of the end of
such fiscal year, a consolidated statement of income and a consolidated
statement of cash flows of CMG and its subsidiaries for such year, setting forth
in each case in comparative form the figures from CMG's previous fiscal year,
all prepared in accordance with generally accepted accounting principles and
practices and audited by nationally recognized independent certified public
accountants. In the event CMG shall no longer be required to file Annual Reports
on Form 10-K, CMG shall, within ninety (90) days following the end of each
respective fiscal year, deliver to the Purchaser a copy of such balance sheets,
statements of income and statements of cash flows.
(ii) Quarterly Reports. Furnish to the Purchaser promptly following the
filing of such report with the SEC, a copy of each of CMG's Quarterly Reports on
Form 10-Q, which shall include a consolidated balance sheet as of the end of the
respective fiscal quarter, consolidated statements of income and consolidated
statements of cash flows of CMG and its subsidiaries for the respective fiscal
quarter and for the year to-date, setting forth in each case in comparative form
the figures from the comparable periods in CMG's immediately preceding fiscal
year, all prepared in accordance with generally accepted accounting principles
and practices, but all of which may be unaudited. In the event CMG shall no
longer be required to file Quarterly Reports on Form 10-Q, CMG shall, within
forty-five (45) days following the end of each of the first three (3) fiscal
quarters of each fiscal year, deliver to the Purchaser a copy of such balance
sheets, statements of income and statements of cash flows.
(iii) Current Reports. Furnish to the Purchaser promptly following the
filing of such report with the SEC, a copy of each of CMG's Current Reports on
Form 8-K.
(b) SEC Filings. CMG shall deliver to the Purchaser copies of each other
document filed with the SEC on a non-confidential basis promptly following the
filing of such document with the SEC.
(c) The provisions of this Section 7.1 shall not be assignable by
Purchaser.
7.2 CMG Business Development Advisory Board. So long as the Purchaser or
a Majority-Owned Subsidiary of Purchaser holds at least 50% of the CMG Shares
(as adjusted for stock splits,
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stock dividends, and similar events), CMG will permit a representative of the
Purchaser, reasonably acceptable to CMG (the "ObserverAdviser"), to attend all
meetings of CMG Business Development Advisory Board (the "Advisory Board"),
whether in person, telephonic or other, in a non-voting, observer capacity and
shall provide to the Purchaser, concurrently with the members of the Advisory
Board, notice of such meeting and a copy of all materials provided to such
members. CMG shall be entitled to recuse the ObserverAdviser from portions of
any Advisory Board meeting and to redact portions of Advisory Board materials
delivered to the ObserverAdviser (i) where and to the extent that a majority of
the Advisory Board (without the ObserverAdviser present) determines a conflict
of interest between CMG and the Purchaser is present (but not where the conflict
is a conflict that is present for stockholders generally) and (ii) if, in the
opinion of CompanyCMG's counsel, attendance at such meeting or access to such
information could adversely effect the attorney-client privilege between CMG and
its counsel. CMG acknowledges and agrees that the ObserverAdviser shall be
acting for the benefit of the Purchaser, whose interests may not coincide with
the interests of CMG and the other stockholders, and that the ObserverAdviser
shall not be deemed to have breached any duty of any kind to CMG or its
stockholders as a result of his or her acting in a manner he or she deems to be
in the interests of the Purchaser. Confidential information obtained by the
ObserverAdviser shall be governed by the terms of the Sumitomo Corporation/CMG
Information Services, Inc. Non-Disclosure Agreement previously entered into and
the Purchaser shall advise the Adviser of the terms of such Non-Disclosure
Agreementby any Confidentiality Agreement separately entered into by the
Observer in connection herewith. The provisions of this Section 7.2 shall not be
assignable by Purchaser.
7.3 Registration Rights.
(a) Definitions. For purposes of this Agreement:
(i) Exchange Act. The term "Exchange Act" means the Securities Exchange
Act of 1934, as amended, or any similar federal statute, and the rules and
regulations of the SEC thereunder, all as the same shall be in effect at the
applicable time.
(ii) Holder. For purposes of this Section 7.3, the term "Holder" means any
person owning of record Registrable Securities that have not been sold to the
public or pursuant to Rule 144 promulgated under the Securities Act or any
permitted assignee of record of such Registrable Securities to whom rights under
this Section 7.3 have been duly assigned in accordance with this Agreement.
(iii) Registration. The terms "register," "registered," and "registration"
refer to a registration effected by preparing and filing a registration
statement in compliance with the Securities
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Act, and the declaration or ordering of effectiveness of such registration
statement.
(iv) Registrable Securities. The term "Registrable Securities" means: (1)
all the shares of Common Stock of CMG issued or issuable under this Agreement
and (2) any shares of Common Stock of CMG issued as (or issuable upon the
conversion or exercise of any warrant, right or other security which is issued
as) a dividend or other distribution with respect to, or in exchange for or in
replacement of, any such shares of Common Stock described in clause (1) of this
subsection (iv). Notwithstanding the foregoing, Registrable Securities shall
exclude any Registrable Securities sold by a person in a transaction in which
rights under this Section 7.3 are not assigned in accordance with this Agreement
or any Registrable Securities sold in a public offering, whether sold pursuant
to Rule 144 promulgated under the Securities Act, in a registered offering, or
otherwise.
(v) Registrable Securities Then Outstanding. The number of shares of
"Registrable Securities then outstanding" shall mean the number of shares of
Common Stock that are Registrable Securities and are then issued and
outstanding.
(vi) Form S-3. The term "Form S-3" means such form under the Securities
Act as in effect on the date hereof or any successor registration form under the
Securities Act subsequently adopted by the SEC which permits inclusion or
incorporation of substantial information by reference to other documents filed
by CMG with the SEC.
(b) Piggyback Registrations.
(i) Notice. CMG shall notify all Holders of Registrable Securities in
writing at least thirty (30) days prior to filing any registration statement
under the Securities Act for purposes of effecting a public offering of
securities of CMG (including, but not limited to, registration statements
relating to secondary offerings of securities of CMG, but excluding registration
statements relating to any registration under subsection (c) of this Section
7.3, to any employee benefit plan or to any merger or other corporate
reorganization) and will afford each such Holder an opportunity to include in
such registration statement all or any part of the Registrable Securities then
held by such Holder. Each Holder desiring to include in any such registration
statement all or any part of the Registrable Securities held by such Holder
shall within twenty (20) days after receipt of the above-described notice from
CMG, so notify CMG in writing, and in such notice shall inform CMG of the number
of Registrable Securities such Holder wishes to include in such registration
statement. If a Holder decides not to include all of its Registrable Securities
in any registration statement thereafter filed by CMG, such Holder shall
nevertheless continue to have the right to include any Registrable Securities
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in any subsequent registration statement or registration statements as may be
filed by CMG with respect to offerings of its securities, all upon the terms and
conditions set forth herein.
(ii) Underwriting. If a registration statement under which CMG gives
notice under this Section 7.3(b) is for an underwritten offering, then CMG shall
so advise the Holders of Registrable Securities. In such event, the right of any
such Holder's Registrable Securities to be included in a registration pursuant
to this Section 7.3(b) shall be conditioned upon such Holder's participation in
such underwriting and the inclusion of such Holder's Registrable Securities in
the underwriting to the extent provided herein. All Holders proposing to
distribute their Registrable Securities through such underwriting shall enter
into an underwriting agreement in customary form with the managing underwriter
or underwriters selected for such underwriting. Notwithstanding any other
provision of this Agreement, if the managing underwriter determine(s) in good
faith that marketing factors require a limitation of the number of shares to be
underwritten, then the managing underwriter(s) may exclude shares from the
registration and the underwriting, and the number of shares that may be included
in the registration and the underwriting shall be allocated, first to CMG, and
second, to each of the Holders and other holders of registration rights on a
parity with the Holders requesting inclusion of their Registrable Securities in
such registration statement on a pro rata basis based on the total number of
Registrable Securities and other securities entitled to registration then held
by each such Holder or other holder; provided, however, that the right of the
underwriters to exclude shares (including Registrable Securities) from the
registration and underwriting as described above shall be restricted so that all
shares that are not Registrable Securities and are held by any other person,
including, without limitation, any person who is an employee, officer or
director of CMG (or any subsidiary of CMG) shall first be excluded from such
registration and underwriting before any Registrable Securities are so excluded
(other than to the extent that such persons are non-employee directors or other
non-employees of CMG who hold registration rights on a parity with the Holders,
such non-employee directors and other non-employees being entitled to
participate with the participating Holders on the basis described under "second"
above). If any Holder disapproves of the terms of any such underwriting, such
Holder may elect to withdraw therefrom by written notice to CMG and the
underwriter, delivered at least ten (10) business days prior to the effective
date of the registration statement. Any Registrable Securities excluded or
withdrawn from such underwriting shall be excluded and withdrawn from the
registration. For any Holder that is a partnership, the Holder and the partners
and retired partners of such Holder, or the estates and family members of any
such partners and retired partners and any trusts for the benefit of any of the
foregoing persons, and for any Holder that is a corporation, the Holder and all
corporations that are affiliates of such Holder, shall be deemed to be a single
Holder, and any pro rata reduction with respect to such Holder shall be based
upon the aggregate amount of shares carrying registration rights owned by all
entities and individuals included in such Holder.
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(iii) Expenses. All expenses incurred in connection with a registration
pursuant to this Section 7.3(b) (excluding underwriters' and brokers' discounts
and commissions relating to shares sold by the Holders and legal fees of counsel
for the Holders), including, without limitation all federal and "blue sky"
registration, filing and qualification fees, printers' and accounting fees, and
fees and disbursements of counsel for CMG, shall be borne by CMG.
(c) Form S-3 Registration. In case CMG shall at any time after February
27, 1999 receive from any Holder or Holders of a majority of all Registrable
Securities then outstanding a written request or requests that CMG effect a
registration on Form S-3 and any related qualification or compliance with
respect to all or a part of the Registrable Securities owned by such Holder or
Holders, then CMG shall:
(i) Notice. Promptly give written notice of the proposed registration and
the Holder's or Holders' request therefor, and any related qualification or
compliance, to all other Holders of Registrable Securities; and
(ii) Registration. As soon as practicable, effect such registration and
all such qualifications and compliances as may be so requested and as would
permit or facilitate the sale and distribution of all or such portion of such
Holders or Holders' Registrable Securities as are specified in such request,
together with all or such portion of the Registrable Securities of any other
Holder or Holders joining in such request as are specified in a written request
given within twenty (20) days after CMG provides the notice contemplated by
Section 7.3(c);
provided, however, that CMG shall not be obligated to effect any such
registration, qualification or compliance pursuant to this Section 7.3(c):
(A) if Form S-3 is not available for such offering by the Holders;
(B) if the Holders, together with the holders of any other securities of
CMG entitled to inclusion in such registration, propose to sell Registrable
Securities and such other securities (if any) representing less than 50% of the
Registrable Securities then held by all Holders;
(C) if CMG shall furnish to the Holders a certificate signed by the
President or Chief Executive Officer of CMG stating that in the good faith
judgment of the Board of Directors of CMG, it would be materially detrimental to
CMG and its stockholders for such Form S-3 registration
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to be effected at such time, in which event CMG shall have the right to defer
the filing of the Form S-3 registration statement no more than once during any
twelve (12) month period for a period of not more than ninety (90) days after
receipt of the request of the Holder or Holders under this Section 7.3(c);
(D) if CMG has, within the six (6) month period preceding the date of such
request, already effected a registration under the Securities Act other than a
registration from which the Registrable Securities of Holders have been excluded
(with respect to all or any portion of the Registrable Securities the Holders
requested be included in such registration) pursuant to the provisions of
Section 7.3(b);
(E) in any particular jurisdiction in which CMG would be required to
qualify to do business or to execute a general consent to service of process in
effecting such registration, qualification or compliance; or
(F) if CMG has already effected two registrations of CMG Shares under the
Securities Act pursuant to this Section 7.3 (c).
(iii) Expenses. CMG shall pay all expenses incurred in connection with
each registration requested pursuant to this Section 7.3(c), (excluding
underwriters' or brokers' discounts and commissions relating to shares sold by
the Holders and legal fees of counsel for the Holders), including without
limitation federal and "blue sky" registration, filing and qualification fees,
printers' and accounting fees, and fees and disbursements of counsel.
(d) Obligations of CMG. Whenever required to effect the registration of
any Registrable Securities under this Agreement CMG shall, as expeditiously as
reasonably possible:
(i) Registration Statement. Prepare and file with the SEC a registration
statement with respect to such Registrable Securities and use its best efforts
to cause such registration statement to become effective and remain effective
(including the filing of any necessary amendments or supplements to such
registration statement) until the Holder has completed the distribution
contemplated thereby or until Holder's remaining Registrable Securities may be
sold under Rule 144 during a period of ninety (90) days. Notwithstanding the
foregoing, if CMG shall furnish to Holder whose Registrable Securities are
included in such registration statement, a certificate signed by the President
or Chief Executive Officer of CMG stating that in the good faith judgment of the
Board of Directors, it would be materially detrimental to CMG and its
stockholders for such Holders to continue to make sales thereunder, the Holders
will, upon receipt of such notice, discontinue the sale
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of such Registrable Securities covered by such registration statement until the
earlier of (A) receipt of a further notice that sales may be resumed or (B)
ninety (90) days after receipt of the initial notice. CMG may not utilize this
right more than once in any twelve (12) month period.
(ii) Amendments and Supplements. Prepare and file with the SEC such
amendments and supplements to such registration statement and the prospectus
used in connection with such registration statement as may be necessary to
comply with the provisions of the Securities Act with respect to the disposition
of all securities covered by such registration statement.
(iii) Prospectuses. Furnish to the Holders such number of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents as they may
reasonably request in order to facilitate the disposition of the Registrable
Securities owned by them that are included in such registration.
(iv) Blue Sky. Use its best efforts to register and qualify the securities
covered by such registration statement under such other securities or "blue sky"
laws of such jurisdictions as shall be reasonably requested by the Holders,
provided that CMG shall not be required in connection therewith or as a
condition thereto to qualify to do business or to file a general consent to
service of process in any such states or jurisdictions.
(v) Underwriting. In the event of any underwritten public offering, enter
into and perform its obligations under an underwriting agreement in usual and
customary form, with the managing underwriter(s) of such offering. Each Holder
participating in such underwriting shall also enter into and perform its
obligations under such an agreement.
(vi) Notification. Notify each Holder of Registrable Securities covered by
such registration statement at any time when a prospectus relating thereto is
required to be delivered under the Securities Act of the happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing. In such event, CMG shall prepare a supplement or post-effective
amendment to such registration statement or related prospectus or file any other
required document so that, as thereafter delivered to the purchasers of
Registrable Securities sold thereunder, the prospectus will not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
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(vii) Opinion and Comfort Letter. Furnish, at the request of any Holder
requesting registration of Registrable Securities, on the date that such
Registrable Securities are delivered to the underwriters for sale, if such
securities are being sold through underwriters, or, if such securities are not
being sold through underwriters, on the date that the registration statement
with respect to such securities becomes effective, (A) an opinion, dated as of
such date, of the counsel representing CMG for the purposes of such
registration, in form and substance as is customarily given to underwriters in
an underwritten public offering and reasonably satisfactory to a majority in
interest of the Holders requesting registration, addressed to the underwriters,
if any, and to the Holders requesting registration of Registrable Securities and
(B) a "comfort" letter, dated as of such date, from the independent certified
public accountants of CMG, in form and substance as is customarily given by
independent certified public accountants to underwriters in an underwritten
public offering and reasonably satisfactory to a majority in interest of the
Holders requesting registration, addressed to the underwriters, if any, and to
the Holders requesting registration of Registrable Securities.
(e) Furnish information. It shall be a condition precedent to the
obligations of CMG to take any action pursuant to Sections 7.3(b) or (c) that
the selling Holders shall furnish to CMG such information regarding themselves,
the Registrable Securities held by them and the intended method of disposition
of such securities as shall be required to timely effect the Registration of
their Registrable Securities.
(f) Indemnification. In the event any Registrable Securities are included
in a registration statement under Section 7.3:
(i) By CMG. To the extent permitted by law, CMG will indemnify and hold
harmless each Holder, the partners, officers and directors of each Holder, any
underwriter (as determined in the Securities Act) for such Holder and each
person, if any, who controls such Holder or underwriter within the meaning of
the Securities Act or the Exchange Act, against any losses, claims, damages or
liabilities (joint or several) to which they may become subject under the
Securities Act, the Exchange Act or other federal or state law, insofar as such
losses, claims, damages, or liabilities (or actions in respect thereof) arise
out of or are based upon any of the following statements, omissions or
violations (collectively a "Violation"):
(A) any untrue statement or alleged untrue statement of a material fact
contained in such registration statement, including any preliminary prospectus
or final prospectus contained therein or any amendments or supplements thereto;
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(B) the omission or alleged omission to state therein a material fact
required to be stated therein, or necessary to make the statements therein not
misleading, or
(C) any violation or alleged violation by CMG of the Securities Act, the
Exchange Act, any federal or state securities law or any rule or regulation
promulgated under the Securities Act, the Exchange Act or any federal or state
securities law in connection with the offering covered by such registration
statement;
and CMG will reimburse each such Holder, partner, officer or director,
underwriter or controlling person for any legal or other expenses reasonably
incurred by them, as incurred, in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that the
indemnity agreement contained in this subsection 7.3(f) shall not apply to
amounts paid in settlement of any such loss, claim, damage, liability or action
if such settlement is effected without the consent of CMG (which consent shall
not be unreasonably withheld), nor shall CMG be liable in any such case for any
such loss, claim, damage, liability or action to the extent that it arises out
of or is based upon a Violation which occurs in reliance upon and in conformity
with written information furnished expressly for use in connection with such
registration by such Holder, partner, officer, director, underwriter or
controlling person of such Holder.
(ii) By Selling Holders. To the extent permitted by law, each selling
Holder will indemnify and hold harmless CMG, each of its directors, each of its
officers who have signed the registration statement, each person, if any, who
controls CMG within the meaning of the Securities Act or the Exchange Act, any
underwriter and any other Holder selling securities under such registration
statement or any of such other Holder's partners, directors or officers or any
person who controls such Holder within the meaning of the Securities Act or the
Exchange Act, against any losses, claims, damages or liabilities (joint or
several) to which CMG or any such director, officer, controlling person,
underwriter or other such Holder, partner or director, officer or controlling
person of such other Holder may become subject under the Securities Act, the
Exchange Act or other federal or state law, insofar as such losses, claims,
damages or liabilities (or actions in respect thereto) arise out of or are based
upon any Violation, in each case to the extent (and only to the extent) that
such Violation occurs in reliance upon and in conformity with written
information furnished by such Holder expressly for use in connection with such
registration; and each such Holder will reimburse any legal or other expenses
reasonably incurred by CMG or any such director, officer, controlling person,
underwriter or other Holder, partner, officer, director or controlling person of
such other Holder in connection with investigating or defending any such loss,
claim, damage, liability or action; provided,
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however, that the indemnity agreement contained in this subsection 7.3(f) shall
not apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent of the
Holder, which consent shall not be unreasonably withheld; and provided, further,
that the total amounts payable in indemnity by a Holder under this
Sectionsubsection 7.3(f) in respect of any Violation shall not exceed the net
proceeds received by such Holder in the registered offering out of which such
Violation arises.
(iii) Notice. Promptly after receipt by an indemnified party under this
Section 7.3(f) of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section 7.3(f), deliver
to the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party shall
have the right to retain its own counsel, with the fees and expenses to be paid
by the indemnifying party, to the extent that representation of such indemnified
party by the counsel retained by the indemnifying party would be inappropriate
due to actual or potential conflict of interests between such indemnified party
and any other party represented by such counsel in such Proceeding. The failure
to deliver written notice to the indemnifying party within a reasonable time of
the commencement of any such action shall relieve such indemnifying party of
liability to the indemnified party under this Section 7.3(f) to the extent the
indemnifying party is prejudiced as a result thereof, but the omission so to
deliver written notice to the indemnified party will not relieve it of any
liability that it may have to any indemnified party otherwise than under this
Section 7.3(f).
(iv) Defect Eliminated in Final Prospectus. The foregoing indemnity
agreements of CMG and Holders are subject to the condition that, insofar as they
relate to any Violation made in a preliminary prospectus but eliminated or
remedied in the amended prospectus on file with the SEC at the time the
registration statement in question becomes effective or the amended prospectus
filed with the SEC pursuant to SEC Rule 424(b) (the "Final Prospectus"), such
indemnity agreement shall not inure to the benefit of any person if a copy of
the Final Prospectus was timely furnished to the indemnified party and was not
furnished to the person asserting the loss, liability, claim or damage at or
prior to the time such action is required by the Securities Act.
(g) Contribution. In order to provide for just and equitable contribution
to joint liability under the Securities Act or the Exchange Act in any case in
which either (i) any Holder exercising rights under this Agreement, or any
controlling person of any such Holder, makes a claim
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for indemnification pursuant to this Section 7.3 but it is judicially determined
(by the entry of a final judgment or decree by a court of competent jurisdiction
and the expiration of time to appeal or the denial of the last right of appeal)
that such indemnification may not be enforced in such case notwithstanding the
fact that this Section 7.3 provides for indemnification in such case, or (ii)
contribution under the Securities Act or the Exchange Act may be required on the
part of any such selling Holder or any such controlling person in circumstances
for which indemnification is provided under this Section 7.3; then, and in each
such case, CMG and such Holder will contribute to the aggregate losses, claims,
damages or liabilities to which they may be subject (after contribution from
others) in such proportion so that such Holder is responsible for the portion
represented by the percentage that the public offering price of its Registrable
Securities offered by and sold under the registration statement bears to the
public offering price of all securities offered by and sold under such
registration statement, and CMG and other selling Holders are responsible for
the remaining portion; provided, however, that, in any such case: (A) no such
Holder will be required to contribute any amount in excess of the public
offering price of all such Registrable Securities offered and sold by such
Holder pursuant to such registration statement; and (B) no person or entity
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) will be entitled to contribution from any person or entity
who was not guilty of such fraudulent misrepresentation.
(h) Survival. The obligations of CMG and Holders under Section 7.3(f)
shall survive until the third anniversary of the completion of any offering of
Registrable Securities in a registration statement, regardless of the expiration
of any statutes of limitation or extensions of such statutes.
(i) Termination of CMG's Obligations. CMG shall have no obligations
pursuant to this Section 7.3 with respect to any Registrable Securities proposed
to be sold by a Holder in a registration pursuant to Section 7.3(b) or (c) more
than three (3) years after the date of this Agreement, or, if, in the opinion of
counsel to CMG, all such Registrable Securities proposed to be sold by a Holder
may then be sold under Rule 144 in any three-month period without exceeding the
volume limitations thereunder.
(j) No Registration Rights to Third Parties. Without the prior written
consent of the Holders of a majority in interest of the Registrable Securities
then outstanding, CMG covenants and agrees that it shall not grant, or cause or
permit to be created, for the benefit of any person or entity any registration
rights of any kind (whether similar to the "piggyback" or Form S-3 registration
rights described in this Section 7.3, or otherwise) relating to shares of CMG's
Common Stock or any other voting securities of CMG, other than rights that are
on a parity with or subordinate in right to the Holders.
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(k) Assignment. The registration rights of the Purchaser shall not be
assigned or assignable to any person or entity acquiring CMG Shares without the
written consent of CMG; and provided, further, that any such assignee (if
consented to by CMG) shall receive such assigned rights subject to all the terms
and conditions of Section 7.3 of this Agreement, and to the further condition
that such assignee of CMG Shares representing more than fifty percent (50%) of
the CMG Shares shall enter into a Standstill Agreement as provided in Section 8
of this Agreement.
7.4 Twelve-Month Holding Period. In consideration of the covenants herein
Purchaser agrees not to sell, pledge, hypothecate or otherwise transfer any of
the CMG Shares prior to the twelve- (12-) month anniversary of the closing of
the Stock Purchasethis Agreement. Purchaser further agrees that the certificates
evidencing the CMG Shares will bear the following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON
TRANSFER SET FORTH IN A STOCK PURCHASE AGREEMENT DATED FEBRUARY 15, 1998 AND MAY
NOT BE TRANSFERRED PRIOR TO FEBRUARY 27, 1999."
7.5 Obligations Regarding Confidential Information.
(a) Obligations. Except to the extent required by law or judicial order or
except as provided herein, each party to this Agreement will hold any of the
other's Confidential Information (as defined in the next paragraph) in
confidence and will: (i) use the same degree of care to prevent unauthorized
disclosure or use of the Confidential Information that the receiving party uses
with its own information of like nature (but in no event less than reasonable
care), (ii) limit disclosure of the Confidential Information, including any
materials regarding the Confidential Information that the receiving party has
generated, to such of its employees and contractors as have a need to know the
Confidential Information, and (iii) advise its employees, agents and contractors
of the confidential nature of the Confidential Information and of the receiving
party's obligations under this Agreement and the Non-Disclosure Agreement
previously entered into by the parties hereto.
(b) Certain Definitions. For purposes of this Agreement, the term
"Confidential Information" refers to confidential information furnished to
Purchaser pursuant to Section 7.2. Any employee or contractor of the receiving
party having access to the Confidential Information will be required to sign a
non-disclosure agreement protecting the Confidential Information if not already
bound by such a non-disclosure agreement.
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(c) Non-Disclosure of Agreements. Either party may disclose the terms of
this Agreement to the extent required by law or judicial order, provided that if
such disclosure is pursuant to judicial order or Proceedings, the disclosing
party will notify the other party promptly before such disclosure and will
cooperate with the other party to seek confidential treatment with respect to
the disclosure if requested by the other party and provided further that if such
disclosure is required pursuant to the rules and regulations of any federal,
state or local organization, the parties will cooperate to seek confidential
treatment of the Agreement to the maximum extent possible under law.
(d) Public Announcements. Prior to the Closing, the parties will agree on
the content of a press release announcing the existence of the transactions
contemplated by this Agreement, which press release will be issued as mutually
agreed by the parties.
(e) Third Party Information. Neither party will be required to disclose to
the other any confidential information of any third party without having first
obtained such third party's prior written consent.
(f) Other Disclosures. All other confidential information exchanged by the
parties will be disclosed pursuant to the Sumitomo Corporation/CMG Information
Services, Inc. Non-Disclosure Agreement previously entered into by the parties.
7.6 Internet Opportunities in Japan. So long as the Purchaser owns at
least 50% of the CMG Shares (as adjusted for stock splits, stock dividends, and
similar events) purchased under this Agreement, CMG will consult with Purchaser
and CMG will cause its Internet Companies (defined as any corporation or other
entity in which CMG owns or controls (or in which CMG may during the term of
thethis Agreement own or control), directly or indirectly at the time of the
opportunity, not less than eighty percent (80%) of security or other ownership
interests, whose primary business utilizes or involves the Internet) to consult
with Purchaser with respect to any major business opportunity in Japan and will
give Purchaser sixty (60) days from the date of notice of such opportunity (the
"Planning Period") to construct a business plan for the realization of such
opportunity, which plan must be in the mutual benefit of Purchaser and CMG or
its Internet Companies, as the case may be. The parties shall jointly take all
reasonable actions with a view to realize the business plan successfully. For
the foregoing, CMG will provide Purchaser with data, analysis and other
information which would be necessary to construct and implement the plan in a
smooth and successful manner. CMG and its Internet Companies shall have the sole
right in its or their complete discretion to reject such plan for any reason,
provided that CMG will refrain from, and will cause CMG's Internet
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Companies to refrain from, implementing or realizing the same or substantially
similar plan in Japan, either directly or in conjunction with any third party
without the prior written consent of Purchaser, which consent shall not be
unreasonably withheld, for a period of one (1) year after the expiration of the
Planning Period. The CMG Internet Companies shall include each of the following
companies so long as CMG owns at least 80% of the outstanding voting stock of
each such company:
ADSmart Corporation
Engage Technologies, Inc.
InfoMation Publishing Corporation
NaviSite Internet Services Corporation
Password Internet Publishing Corporation
Planet Direct Corporation
Notwithstanding the foregoing, nothing herein shall prohibit CMG and/or its
Internet Companies from pursuing, either by itself or with any third party, any
such major business opportunity in Japan, provided that in doing so, (i) they do
not use any important and material trade secrets belonging to the Purchaser, or
(ii) they use a plan not substantially similar to the plan developed hereunder.
The provisions of this Section 7.6 shall not be assignable by Purchaser and
shall terminate five (5) years after the Closing Date unless renewed by
agreement of the parties.
7.7 Long Term Relationship. The parties agree that they will closely
cooperate with each other so as to combine their respective business resources
(including the infrastructure and the contents of the Internet) and thereby to
explore and develop various business opportunities, alliances and transactions
relating to the Internet in Japan involving themselves or their affiliated
companies, such that the long term and strategic partnershiprelationship between
the parties may be successfully enhanced and expanded. For the foregoing, the
parties will keep each other informed of the status of business in Japan with a
view to achieve the foregoing intentions of the parties smoothly.
Notwithstanding the foregoing, nothing in this Agreement shall obligate either
party (i) to enter into a business relationship with the other party that is not
in its best interests, or (ii) to refrain from pursuing a business relationship
with a third party that is in its best interests. The provisions of this Section
7.7 shall not be assignable by Purchaser and shall terminate five (5) years
after the Closing Date unless renewed by agreement of the parties.
8. STANDSTILL AGREEMENT.
8.1 Standstill. The Purchaser hereby agrees that the Purchaser (together
with all Majority
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Owned Subsidiaries, as defined below) shall neither acquire, nor enter into
discussions, negotiations, arrangements or understandings with any third party
to acquire, beneficial ownership (as defined in Rule 13d-3 promulgated under the
Exchange Act) of any Voting Stock (as defined below), any securities convertible
into or exchangeable for Voting Stock, or any other right to acquire Voting
Stock (except, in any case, by way of stock dividends or other distributions or
offerings made available to holders of any Voting Stock generally) without the
written consent of CMG, if the effect of such acquisition would be to increase
the Voting Power (as defined below) of all Voting Stock then beneficially owned
by the Purchaser or which it has a right to acquire (together with all Majority
Owned Subsidiaries) to a percentage greater than ten percent (10%) (the
"Standstill Percentage") of the Total Voting Power (as defined below) of CMG at
the time in effect;
provided that:
(a) The Purchaser will not be obliged to dispose of any Voting Stock to the
extent that the aggregate percentage of the Total Voting Power of CMG
represented by Voting Stock beneficially owned by the Purchaser or which the
Purchaser has a right to acquire is increased beyond the Standstill Percentage
(i) as a result of a recapitalization of CMG or a repurchase or exchange of
securities by CMG or any other action taken by CMG or its affiliates; (ii) as a
result of an equity index transaction, provided that Purchaser shall not vote
such shares; (iii) by way of stock dividends or other distributions or rights or
offerings made available to holders of shares of Voting Stock generally; (iv)
with the consent of a simple majority of the independent authorized members of
CMG's Board of Directors; or (v) as part of a transaction on behalf of
Purchaser's Defined Benefit Pension Plan, Profit Sharing Retirement Plan, 401(k)
Savings Plan, Sheltered Employee Retirement Plan and Sheltered Employee
Retirement Plan Plus, or any successor or additional retirement plans thereto
(collectively, the "Retirement Plans") where CMG's shares in such Retirement
Plans are voted by a trustee for the benefit of Purchaser employees or, for
those Retirement Plans where Purchaser controls voting, where Purchaser agrees
not to vote any shares of such Retirement Plan Voting Stock that would cause
Purchaser to exceed the Standstill Percentage.
(b) As used in this Article 8, (i) the term "Voting Stock" means the Common
Stock and any other securities issued by CMG having the ordinary power to vote
in the election of directors of CMG (other than securities having such power
only upon the happening of a contingency that has not occurred), (ii) the term
"Voting Power" of any Voting Stock means the number of votes such Voting Stock
is entitled to cast for directors of CMG at any meeting of stockholders of CMG,
(iii) the term "Total Voting Power" means the total number of votes which may be
cast in the election of directors of CMG at any meeting of stockholders of CMG
if all Voting Stock was represented and voted to the
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fullest extent possible at such meeting (other than votes that may be cast only
upon the happening of a contingency that has not occurred) and (iv) the term
"Majority Owned Subsidiary" means a corporation a majority of whose voting
securities are owned by Purchaser. For purposes of this Section 8, the Purchaser
shall not be deemed to have beneficial ownership of any Voting Stock held by a
pension plan or other employee benefit program of the Purchaser if the Purchaser
does not have the power to control the investment decisions of such plan or
program.
8.2 Right of First Offer Upon Transfer of Fifty Percent of the CMG Shares.
If the Purchaser intends to sell Voting Stock with Voting Power constituting
more than fifty percent (50%) of the CMG Shares, the Purchaser shall provide
written notice thereof to CMG (the "Purchaser Notice"). The Purchaser Notice
shall specify the number of CMG Shares involved and the proposed price per
share. For a period of 48 hours after delivery of the Purchaser Notice, CMG
shall be entitled to elect to purchase all, but not less than all, of the CMG
Shares described in the Purchaser Notice, at the price per share described in
such notice, by delivery of a written notice (a "CompanyCMG Purchase Election")
to the Purchaser irrevocably electing to purchase such Shares and shall have
five (5) business days to consummate said purchase from the Purchaser. In the
event that CMG has not delivered a CompanyCMG Purchase Election prior to the
expiration of such 48-hour period or has failed to purchase such CMG Shares
within said five (5)-business day period, CMG's right to purchase such CMG
Shares shall expire, and the Purchaser or Majority Owned Subsidiary shall be
entitled to sell the CMG Shares described in the Purchaser Notice for a period
of ninety (90) days following the expiration of such 90-day period, but only to
the proposed purchaser set forth in the Purchaser Notice (or any Majority Owned
Subsidiary thereof) and only for a purchase price equal to at least eighty-five
percent (85%) of the purchase price set forth in the Purchaser Notice. In the
event the Purchaser or Majority Owned Subsidiary has not sold such CMG Shares by
the end of such 90-day period, the rights of CMG set forth above in this Section
8.38.2 shall apply to any subsequent sales by the Purchaser or Majority Owned
Subsidiary. Notwithstanding the foregoing, the provisions of this Section 8.2
shall not apply to any sales or other transfers by the Purchaser to any Majority
Owned Subsidiary or pursuant to Rule 144. Purchaser further agrees that it will
not sell the CMG Shares privately to a competitor of CMG.
8.3 Voting and Participation in Mergers and Similar Transactions. Subject
to the provisions of Section 8.2 above, Purchaser agrees that it will not,
individually or as part of a group, without the consent of a majority of the
independent directors of CMG: (a) solicit proxies with respect to Voting Stock
or become a participant in any election contest relating to the election of
directors of CMG; (b) deposit any Voting Stock in a voting trust or enter into a
voting agreement or other arrangement of similar effect; (c) initiate, propose
or solicit stockholders for the approval of one or
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more stockholder proposals; (d) propose or solicit any person to propose a
business combination with, or a change of control of, CMG; or (e) make or
propose to make a tender offer for Voting Stock or solicit any person to make or
propose to make a tender offer for Voting Stock. For purposes of this Section
8.3, the terms "election contest", "group", "solicit" and "participant" shall
have the meanings ascribed to such terms under the Exchange Act.
8.4 Termination of Standstill. The provisions of Article 8 shall
terminate on the third anniversary of the date of the Closing and shall
terminate as to any particular CMG Shares upon the sale of such CMG Shares in
the open market pursuant to Rule 144 or an effective registration statement.
9. INDEMNIFICATION.
9.1 Agreement to Indemnify.
(a) CompanyCMG Indemnity. The Purchaser, its Affiliates and Associates,
and each officer, director, shareholder, employer, representative and agent of
any of the foregoing (collectively, the "Purchaser Indemnitees") shall each be
indemnified and held harmless to the extent set forth in this Section 9 by CMG
with respect to any and all Damages (as defined below) incurred by any Purchaser
Indemnitee as a proximate result of any inaccuracy or misrepresentation in, or
breach of, any representation, warranty, covenant or agreement made by CMG in
this Agreement (including any exhibits and schedules hereto); provided, however,
that indemnification for claims arising from the registration of the CMG Shares
under Federal and state securities laws shall be covered by Section 7.3 (f) and
not by this Section 9.
(b) Purchaser Indemnity. CMG, its Affiliates and Associates, and each
officer, director, shareholder, employer, representative and agent of any of the
foregoing (collectively, the "CompanyCMG Indemnitees") shall each be indemnified
and held harmless to the extent set forth in this Section 9, by the Purchaser,
in respect of any and all Damages incurred by any CompanyCMG Indemnitee as a
proximate result of any inaccuracy or misrepresentation in, or breach of, any
representation. warranty, covenant or agreement made by the Purchaser in this
Agreement; provided, however, that indemnification for claims arising from the
registration of the CMG Shares under Federal and state securities laws shall be
covered by Section 7.3 (f) and not by this Section 9.
(c) Equitable Relief. Nothing set forth in this Section 9 shall be deemed
to prohibit or
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limit any Purchaser Indemnitee's or CompanyCMG Indemnitee's right at any time
before, on or after the Closing, to seek injunctive or other equitable relief
for the failure of any Indemnifying Party to perform or comply with any covenant
or agreement contained herein.
9.2 Survival. Except as provided in Section 7.3(f) as to matters covered
thereby, all representations and warranties of the Purchaser and CMG contained
herein and all claims of any Purchaser Indemnitee or CompanyCMG Indemnitee in
respect of any inaccuracy or misrepresentation in or breach hereof, shall
survive the Closing for eighteen (18) months following the date of this
Agreement, regardless of whether the applicable statute of limitations,
including extensions thereof, may expire. All covenants and agreements of the
Purchaser and CMG contained in this Agreement shall survive the Closing in
perpetuity (except to the extent any such covenant or agreement shall expire by
its terms). All claims of any Purchaser Indemnitee or CompanyCMG Indemnitee in
respect of any breach of such covenants or agreements shall survive the Closing
until the expiration of two years following the non-breaching party's obtaining
actual knowledge of such breach.
9.3 Claims for Indemnification. If any Purchaser Indemnitee or CompanyCMG
Indemnitee (an "Indemnitee") shall believe that such Indemnitee is entitled to
indemnification pursuant to this Section 9 in respect of any Damages, such
Indemnitee shall give the appropriate Indemnifying Party (which for purposes
hereof, in the case of an Purchaser Indemnitee, means CMG, and in the case of a
CompanyCMG Indemnitee, means the Purchaser) prompt written notice thereof. Any
such notice shall set forth in reasonable detail and to the extent then known
the basis for such claim for indemnification. The failure of such Indemnitee to
give notice of any claim for indemnification promptly shall not adversely affect
such Indemnitee's right to indemnity hereunder except to the extent that such
failure adversely affects the right of the Indemnifying Party to assert any
reasonable defense to such claim. Each such claim for indemnity shall expressly
state that the Indemnifying Party shall have only the twenty (20) business day
period referred to in the next sentence to dispute or deny such claim. The
Indemnifying Party shall have twenty (20) business days following its receipt of
such notice either (a) to acquiesce in such claim by giving such Indemnitee
written notice of such acquiescence or (b) to object to the claim by giving such
Indemnitee written notice of the objection. If the Indemnifying Party does not
object thereto within such twenty (20) business day period, such Indemnitee
shall be entitled to be indemnified for all Damages reasonably and proximately
incurred by such Indemnitee in respect of such claim. If the Indemnifying Party
objects to such claim in a timely manner, the senior management of CMG and the
Purchaser shall meet to attempt to resolve such dispute. If the dispute cannot
be resolved by the senior management either party may make a written demand for
formal dispute resolution and specify therein the scope of the dispute. Within
thirty (30) days after such written notification, the parties agree to meet for
one (1) day with an impartial mediator and consider dispute
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resolution alternatives other than litigation. If an alternative method of
dispute resolution is not agreed upon within thirty days after the one day
mediation, either party may begin litigation proceedings. Nothing in this
section shall be deemed to require arbitration.
9.4 Defense of Claims. In connection with any claim that may give rise to
indemnity under this Section 9 resulting from or arising out of any claim or
Proceeding against an Indemnitee by a person or entity that is not a party
hereto, the Indemnifying Party may but shall not be obligated to (unless such
Indemnitee elects not to seek indemnity hereunder for such claim), upon written
notice to the relevant Indemnitee, assume the defense of any such claim or
Proceeding if the Indemnifying Party with respect to such claim or Proceeding
acknowledges to the Indemnitee the Indemnitee's right to indemnity pursuant
hereto to the extent provided herein (as such claim may have been modified
through written agreement of the parties or arbitration hereunder) and provides
assurances, satisfactory to such Indemnitee, that the Indemnifying Party will be
financially able to satisfy such claim to the extent provided herein if such
claim or Proceeding is decided adversely; provided, however, that nothing set
forth herein shall be deemed to require the Indemnifying Party to waive any
crossclaims or counterclaims the Indemnifying Party may have against the
Indemnified Party for damages. The Indemnified Party shall be entitled to retain
separate counsel, reasonably acceptable to the Indemnifying Party, if the
Indemnified Party shall determine, upon the written advice of counsel, that an
actual or potential conflict of interest exists between the Indemnifying Party
and the Indemnified Party in connection with such Proceeding. The Indemnifying
Party shall be obligated to pay the reasonable fees and expenses of such
separate counsel to the extent the Indemnified Party is entitled to
indemnification by the Indemnifying Party with respect to such claim or
Proceeding under this Section 9.4. If the Indemnifying Party assumes the defense
of any such claim or Proceeding, the Indemnifying Party shall select counsel
reasonably acceptable to such Indemnitee to conduct the defense of such claim or
Proceeding, shall take all steps necessary in the defense or settlement thereof
and shall at all times diligently and promptly pursue the resolution thereof. If
the Indemnifying Party shall have assumed the defense of any claim or Proceeding
in accordance with this Section 9.4, the Indemnifying Party shall be authorized
to consent to a settlement of, or the entry of any judgment arising from, any
such claim or Proceeding, with the prior written consent of such Indemnitee, not
to be unreasonably withheld; provided, however, that the Indemnifying Party
shall pay or cause to be paid all amounts arising out of such settlement or
judgment concurrently with the effectiveness thereof; provided, further, that
the Indemnifying party shall not be authorized to encumber any of the assets of
any Indemnitee or to agree to any restriction that would apply to any Indemnitee
or to its conduct of business; and provided, further, that a condition to any
such settlement shall be a complete release of such Indemnitee and its
Affiliates, Associates, directors, officers, employees and agents with respect
to such claim, including any reasonably foreseeable collateral consequences
thereof. Such Indemnitee
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shall be entitled to participate in (but not control) the defense of any such
action, with its own counsel and at its own expense. Each Indemnitee shall, and
shall cause each of its Affiliates, Associates, directors, officers, employees
and agents to, cooperate fully with the Indemnifying Party in the defense of any
claim or Proceeding being defended by the Indemnifying Party pursuant to this
Section 9.4. If the Indemnifying Party does not assume the defense of any claim
or Proceeding resulting therefrom in accordance with the terms of this Section
9.4, such Indemnitee may defend against such claim or Proceeding in such manner
as it may deem appropriate, including settling such claim or Proceeding after
giving notice of the same to the Indemnifying Party, on such terms as such
Indemnitee may deem appropriate. If any Indemnifying Party seeks to question the
manner in which such Indemnitee defended such claim or Proceeding or the amount
of or nature of any such settlement, such Indemnifying Party shall have the
burden to prove by a preponderance of the evidence that such Indemnitee did not
defend such claim or Proceeding in a reasonably prudent manner.
9.5 Certain Definitions. As used in this Section 9, (a) "Affiliate"
means, with respect to any person or entity, any person or entity directly or
indirectly controlling, controlled by or under direct or indirect common control
with such other person or entity; (b) "Associate" means, when used to indicate a
relationship with any person or entity, (1) any other person or entity of which
such first person or entity is an officer, director or partner or is, directly
or indirectly. the beneficial owner of ten percent (10%) or more of any class of
equity securities, membership interests or other comparable ownership interests
issued by such other person or entity, (2) any trust or other estate in which
such first person or entity has a ten percent (10%) or more beneficial interest
or as to which such first person or entity serves as trustee or in a similar
fiduciary capacity, and (3) any relative or spouse of such first person or
entity who has the same home as such first person or entity or who is a director
or officer of such first person or entity; (c) "Damages" means all demands,
claims, actions or causes of action, assessments, losses, damages, costs,
expenses, liabilities, judgments, awards, fines, response costs, sanctions,
taxes, penalties, charges and amounts paid in settlement, including (1) interest
on cash disbursements in respect of any of the foregoing at the prime rate of
Bank of America NT&SA, as in effect from time to time, compounded quarterly,
from the date each such cash disbursement is made until the date the party
incurring such cash disbursement shall have been indemnified in respect thereof,
and (2) reasonable out-of-pocket costs, fees and expenses (including reasonable
costs, fees and expenses of attorneys, accountants and other agents of, or other
parties retained by, such party), and (d) "Proceeding" means any action, suit,
hearing, arbitration, audit, proceeding (public or private) or investigation
that is brought or initiated by or against any federal, state, local or foreign
governmental authority or any other person or entity.
10. MISCELLANEOUS.
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10.1 Successors and Assigns. The terms and conditions of this Agreement
will inure to the benefit of and be binding upon the respective successors and
assigns of the parties.
10.2 Governing Law and Dispute Resolution. This Agreement shall be
governed by and construed in accordance with the laws of the Commonwealth of
Massachusetts (excluding choice of law principles), and both parties agree that
all disputes arising between them related to this Agreement in any respect and
the enforcement of this Agreement shall be resolved only and exclusively in the
United States Federal Court in Boston, Massachusetts. The Purchaser hereby
consents to the jurisdiction of the United States Federal Court in Boston,
Massachusetts, with respect to any action, suit or proceeding commenced in any
such court by CMG or its successors or assigns, and the Purchaser waives any
defense it may have with respect to such jurisdiction or with respect to the
proper venue of any such action, suit or proceeding in any such court.
10.3 Counterparts. This Agreement may be executed in two or more
counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument.
10.4 Headings. The headings and captions used in this Agreement are used
for convenience only and are not to be considered in construing or interpreting
this Agreement. All references in this Agreement to sections, paragraphs,
exhibits and schedules will, unless otherwise provided, refer to sections and
paragraphs hereof and exhibits and schedules attached hereto, all of which
exhibits and schedules are incorporated herein by this reference.
10.5 Notices. Any notice required or permitted under this Agreement will
be given in writing, shall be effective when received, and shall in any event be
deemed received and effectively given upon personal delivery to the party to be
notified or three (3) business days after mailing, by registered air mail,
postage prepaid, or one (1) business day after deposit with a nationally
recognized courier service such as Federal Express for next business day
delivery under circumstances in which such service guarantees next business day
delivery, or one (1) business day after facsimile with copy delivered by
registered air mail, postage prepaid and addressed to the party to be notified
at the address as specified at the beginning of this Agreement or at such other
address as the Purchaser or CMG may designate by giving at least ten (10) days
advance written notice pursuant to this Section 10.5.
10.6 No Finder's Fees. Each party represents that it neither is nor will
be obligated for any
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finder's or broker's fee or commission in connection with this transaction. The
Purchaser will indemnify and hold harmless CMG from any liability for any
commission or compensation in the nature of a finders' or broker's fee for which
the Purchaser or any of its officers, partners, employees or consultants, or
representatives is responsible. CMG will indemnify and hold harmless the
Purchaser from any liability for any commission or compensation in the nature of
a finder's or broker's fee for which CMG or any of its officers, employees or
consultants or representatives is responsible.
10.7 Amendments and Waivers. This Agreement may be amended and the
observance of any term of this Agreement may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of CMG and the holders of CMG Shares representing at least a
majority of the total aggregate number of CMG Shares then outstanding (excluding
any of such shares that have been sold to the public pursuant to SEC Rule 144 or
otherwise). Any amendment or waiver effected in accordance with this Section
10.7 will be binding upon the Purchaser, CMG and their respective successors and
assigns.
10.8 Severability. If any provision of this Agreement is held to be
unenforceable under applicable law, such provision will be excluded from this
Agreement and the balance of the Agreement will be interpreted as if such
provision were so excluded and will be enforceable in accordance with its terms.
10.9 Entire Agreement. This Agreement and all exhibits and schedules
hereto and thereto constitutes the entire agreement and understanding of the
parties with respect to the subject matter hereof and supersedes any and all
prior negotiations, correspondence, agreements. understandings duties or
obligations between the parties with respect to the subject matter hereof.
10.10 Further Assurances. From and after the date of this Agreement upon
the request of CMG or the Purchaser, CMG and the Purchaser will execute and
deliver such instruments, documents or other writings as may be reasonably
necessary or desirable to confirm and carry out and to effectuate fully the
intent and purposes of this Agreement.
10.11 Meaning of Include and Including. Whenever in this Agreement the
word "include" or "including" is used, it shall be deemed to mean "include,
without limitation" or "including, without limitation," as the case may be, and
the language following "include" or "including" shall not be deemed to set forth
an exhaustive list.
10.12 Fees, Costs and Expenses. All fees, costs and expenses (including
attorney's' fees
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and expenses) incurred by either party hereto in connection with the
preparation, negotiation and execution of this Agreement and the consummation of
the transactions contemplated hereby (including the costs associated with any
filings with, or compliance with any of the requirements of, any governmental
authorities), shall be the sole and exclusive responsibility of such party.
10.13 Competition. Nothing set forth herein shall be deemed to preclude,
limit or restrict CMG's or the Purchaser's ability to compete with the other.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date and year first above written.
CMG INFORMATION SERVICES, INC.
By: /s/ Andrew J. Hajducky
---------------------------------
Name: Andrew J. Hajducky III, CPA
Title: Chief Financial Officer, Treasurer
SUMITOMO CORPORATION
By: /s/ Atsushi Nishijo
---------------------------------
Name: Atsushi Nishijo
Title: Managing Director
General Manager
Media Business Div.
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