NFO RESEARCH, INC.
EMPLOYMENT AGREEMENT
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THIS AGREEMENT is made as of December 12, 1996, by and between NFO
Research, Inc., a Delaware corporation (the "Company"), and Xxxxxxx X. Xxxxxx
(the "Executive").
The Board of Directors of the Company (the "Board") recognizes that
the Executive's contribution to the growth and success of the Company has been
substantial and desires to assure the Executive's continued employment with the
Company as its Executive Vice President -- Interactive Business Development and
to compensate him therefor, and the Executive is willing to be employed by the
Company on the terms herein provided.
In consideration of the foregoing and the respective covenants and
agreements of the parties herein contained, the parties hereto agree as follows:
1. EMPLOYMENT AND ACCEPTANCE.
The Company hereby employs the Executive and the Executive hereby
accepts employment from the Company, upon the terms and conditions set forth in
this Agreement, for the period beginning on the date hereof and ending as
provided in paragraph 5 hereof (the "Employment Period").
2. DUTIES AND AUTHORITY.
2.1 DUTIES. The Executive agrees to use his best efforts,
skill and abilities to promote the Company's interest in his capacity as
Executive Vice President -- Interactive Business Development of the Company, and
to perform such duties (consistent with his status as set forth in this Section
2) as may be assigned to him by the Board.
2.2 TITLE. The Executive shall be the Executive Vice
President -- Interactive Business Development of the Company.
3. PLACE OF EMPLOYMENT.
The duties to be performed by the Executive hereunder shall be
performed primarily at the executive headquarters of the Company, subject to
reasonable travel requirements on behalf of the Company.
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4. COMPENSATION AND BENEFITS.
4.1 COMPENSATION. As compensation for services to be rendered
pursuant to this Agreement, the Company shall pay the Executive's salary at the
annual rate of no less than $240,000 (the "Base Salary"), payable in accordance
with the payroll policy of the Company, less such deductions or amounts to be
withheld as shall be required by applicable law and regulations. The Executive's
salary shall be reviewed annually and, at the discretion of the Board, may be
increased on each January 1 of the Employment Period.
4.2 BONUS. The Executive's incentive compensation package
("Annual Bonus") shall be determined by the Compensation Committee of the Board.
4.3 EMPLOYEE BENEFIT PLANS: FRINGE BENEFITS. Except as
provided in the following sentence, the Company agrees to continue in all
material respects on terms at least as favorable to the Executive (as determined
in the good faith judgment of the Board) as those in effect on the date hereof,
all group life, hospitalization or disability insurance plans, health programs,
pension plans, profit sharing plans, similar benefit plans, automobile, club
membership and relocation allowances and other so-called "fringe benefits" of
the Company (collectively, "Fringe Benefits"). The Company agrees that each of
the Fringe Benefits in effect on the date hereof or at any time during the
Employment Period shall not be terminated, modified or replaced in any manner
that materially reduces the benefits to the Executive without the written
consent of the Executive, unless such termination or modification relates to a
Fringe Benefit that is available generally to employees of the Company or to
executive employees of the Company and such termination or modification affects
all employees covered by such Fringe Benefit.
4.4 VACATIONS. The Executive shall be entitled to reasonable
non-accumulating annual periods of vacation (not less than an aggregate of four
weeks in any calendar year) with full pay.
5. TERM.
(a) The Employment Period shall end on December 12, 1999,
provided that (i) the Employment Period shall terminate prior to such date upon
the Executive's resignation, death or permanent disability or incapacity (as
determined in good faith by the Board in its good faith judgment) and (ii) the
Employment Period may be terminated by the Company at any time prior to such
date for Cause (as defined below) or without Cause.
(b) If at any time the Employment Period is terminated by the
Company without Cause, the Executive shall be entitled to receive his Base
Salary through December 12, 1999, so long as the Executive has not materially
breached the provisions of paragraphs 6, 7 and 8 hereof.
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(c) If the Employment Period is terminated by the Company for
Cause or is terminated pursuant to clause (a)(i) above, the Executive shall be
entitled to receive his Base Salary through the date of termination; PROVIDED,
HOWEVER, that, notwithstanding the foregoing, if the Employment Period shall be
terminated pursuant to clause (a)(i) above by the resignation of the Executive
for "Good Reason" at any time following a "Change of Control" of the Company,
the Executive shall be entitled to receive, and the Company shall be required to
provide to the Executive, the Executive's then-current Base Salary through the
later of (i) December 12, 1999, or (ii) the first anniversary of such
resignation, and, in such event, the Executive shall also be entitled to
receive, and the Company shall be required to provide to the Executive, a
pro-rated portion of the Executive's bonus for the year in which such
resignation occurs, such bonus to be payable within thirty days of such
termination.
For purposes of this Agreement, the phrase "Change of Control" shall
mean the following and shall be deemed to have occurred if any of the following
events shall have occurred: (i) any "person" or "group" (as such terms are used
in Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act")) is or becomes the "beneficial owner" (as defined in Rule
13d-3 under the Exchange Act as in effect on the date hereof, except that a
person shall be deemed to be the "beneficial owner" of all shares that any such
person has the right to acquire pursuant to any agreement or arrangement or upon
exercise of conversion rights, warrants, options or otherwise, without regard to
the sixty-day period referred to in such Rule), directly or indirectly, of
securities representing 30% or more of the combined voting power of the
Company's then outstanding voting securities; or (ii) at any time during any
period of two consecutive years (not including any period prior to the execution
of this Agreement), individuals who at the beginning of such period constituted
the Board and any new directors, whose election by the Board or nomination for
election by the Company's stockholders was approved by a vote of at least
two-thirds (2/3) of the Company directors then still in office who either were
the Company directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any reason to
constitute a majority thereof. Notwithstanding the foregoing, a Change in
Control shall not be deemed to occur merely by reason of an acquisition of
Company securities by, or any consolidation, merger or exchange of securities
with, any entity that, immediately prior to such acquisition, consolidation,
merger or exchange of securities, was a "subsidiary," as such term is defined
below. For these purposes, the term "subsidiary" means (i) any corporation of
which 95% of the capital stock of such corporation is owned, directly or
indirectly, by the Company and (ii) any unincorporated entity in respect of
which the Company has, directly or indirectly, an equivalent degree of
ownership.
For purposes of this Agreement "Good Reason" shall mean the
following and shall be deemed to have occurred if any of the following events
shall have occurred: (i) the Executive is removed from the position of Executive
Vice
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President, or is assigned duties and responsibilities that are inconsistent, in
a material adverse respect, with the scope of duties and responsibilities
associated with the Executive's position as Executive Vice President; (ii) the
Company fails to pay the Executive any amounts otherwise due hereunder; or (iii)
the Executive's Base Salary is reduced or his Fringe Benefits are reduced;
PROVIDED, in any such case, that the Executive has notified the Company in
writing of the basis for claiming his entitlement to resign from his employment
for Good Reason and the Company has failed to cure such condition within 10 days
following the receipt of such notice from the Executive.
(d) The Executive shall receive Fringe Benefits during any
period in which the Executive is entitled to receive his Base Salary hereunder,
and thereafter such rights to Fringe Benefits shall cease.
(e) In the event of a "Change in Control" of the Company, or
in the event that the Employment Period is terminated by the Company without
Cause, each of the Executive's stock options granted under the NFO Research,
Inc. Stock Option Plan (the "Plan") shall immediately become fully exercisable.
In the case of termination of the Employment Period by the Company without
Cause, or if the Employment Period is terminated pursuant to clause (a)(i) above
by the resignation of the Executive for "Good Reason" at any time following a
"Change in Control" of the Company, each of the Executive's stock options
granted under the Plan shall remain exercisable for a period of 12 months after
such termination, except to the extent the Committee (as defined in the Plan)
permits exercise after such date in accordance with the Plan.
(f) For purposes of this Agreement, "Cause" shall mean (i) the
commission of a felony or a crime involving moral turpitude or the commission of
any other act involving dishonesty, disloyalty or fraud with respect to the
Company or any of its subsidiaries, (ii) conduct tending to bring the Company or
any of its subsidiaries into substantial public disgrace or disrepute, (iii)
substantial and repeated failure to perform duties as reasonably and lawfully
directed by the Board, (iv) gross negligence or willful misconduct with respect
to the Company or any of its subsidiaries or (v) any other material breach of
this Agreement which is not cured within 15 days after written notice thereof to
the Executive.
6. CONFIDENTIAL INFORMATION. The Executive acknowledges that the
information, observations and data obtained by him while employed by the Company
(including those obtained while employed by the Company prior to the date of
this Agreement) concerning the business or affairs of the Company or any
subsidiary of the Company ("Confidential Information") are the property of the
Company or such subsidiary. Therefore, Executive agrees that he shall not
disclose to any unauthorized person or use for his own account any Confidential
information without the prior written consent of the Board, unless and to the
extent that the aforementioned matters are or become generally known to and
available for use by the members of the
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industry in which the Company operates other than as a result of Executive's
acts or omissions to act. Executive shall deliver to the Company at the
termination of the Employment Period, or at any other time the Company may
request, all memoranda, notes, plans, records, reports, computer tapes and
software and other documents and data (and copies thereof) relating to the
Confidential Information, Work Product (as defined in Section 7) or the business
of the Company or any subsidiary which he may then possess or have under his
control.
7. INVENTIONS AND WORK PRODUCT. The Executive agrees that all
inventions, innovations, improvements, developments, methods, designs, analyses,
drawings, reports and all similar or related information which relates to the
Company or any of its subsidiaries' actual or anticipated business, research and
development or existing or future products or services and which are conceived,
developed or made by Executive while employed by the Company, such subsidiary or
the Company's predecessors ("Work Product") belong to the Company or such
subsidiary. The Executive will promptly disclose such Work Product to the Board
and perform all actions reasonably requested by the Board (whether during or
after the Employment Period) to establish an confirm such ownership (including,
without limitation, assignments, consents, powers of attorney and other
instruments).
8. NON-COMPETE, NON-SOLICITATION.
(a) The Executive acknowledges that in the course of his
employment with the Company and its subsidiaries he will become familiar, and
during his employment with the Company and its predecessors he has become
familiar, with the Company's and its subsidiaries' trade secrets and with other
confidential information concerning the Company, its subsidiaries and the
Company's predecessors and that his services have been and will be of special,
unique and extraordinary value to the Company and its subsidiaries. Therefore,
the Executive agrees that, during the Employment Period and in the case of
termination for Cause or resignation (other than resignation for "Good Reason"
following a "Change in Control"), for two years thereafter (the "Noncompete
Period"), he shall not directly ro indirectly own, manage, control, participate
in, consult with, render services for, or in any manner engage in any business
competing with the businesses of the Company or its subsidiaries as such
businesses exist or are in process on the date of the termination of the
Executive's employment, within any geographical area in which the Company or its
subsidiaries engage or plan to engage in such businesses. Nothing herein shall
prohibit the Executive from being a passive owner of not more than 5% of the
outstanding stock of any class of a corporation which is publicly traded, so
long as the Executive has no active participation in the business of such
corporation.
(b) During the Noncompete Period, the Executive shall not
directly or indirectly through another entity (i) induce or attempt to induce
any employee of the Company or any subsidiary to leave the employ of the Company
or such subsidiary, or in any way interfere with the relationship between the
Company
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or any subsidiary and any employee thereof, (ii) hire any person who was an
employee of the Company or any subsidiary at any time during the Employment
Period, or (iii) induce or attempt to induce any customer, supplier, licensee or
other business relation of the Company or any subsidiary to cease doing business
with the Company or such subsidiary, or in any way interfere with the
relationship between any such customer, supplier, licensee or business relation
and the Company or any subsidiary.
(c) If, at the time of enforcement of this paragraph 8, a
court shall hold that the duration, scope or area restrictions stated herein are
unreasonable under circumstances then existing, the parties agree that the
maximum duration, scope or area reasonable under such circumstances shall be
substituted for the stated duration, scope or area and that the court shall be
allowed to revise the restrictions contained herein to cover the maximum period,
scope and area permitted by law.
(d) In the event of the breach or a threatened breach by the
Executive of any of the provisions of this paragraph 8, the Company, in addition
and supplementary to other rights and remedies existing in its favor, may apply
to any court of law or equity of competent jurisdiction for specific performance
and/or injunctive or other relief in order to enforce or prevent any violations
of the provisions hereof (without posting a bond or other security).
9. OTHER PROVISIONS.
9.1 INDEMNIFICATION. The company shall indemnify the Executive
against, and shall advance expenses incurred by the Executive in the
investigation and defense of, any claim arising out of his employment under this
Agreement to the fullest extent permitted by the Delaware General Corporation
Law.
9.2 NOTICES. Any notice or communication required or permitted
hereunder shall be in writing and shall be delivered by certified, registered or
express mail, postage prepaid. Any such notice shall be deemed given when so
delivered as follows:
(i) If to the Company, to:
NFO Research, Inc.
0 Xxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
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with a copy to:
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx
1285 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxx X. Xxxxx, Esq.
(ii) If the Executive, to the Executive in care of the
Company at the above address, with a copy to the Executive at his then-current
residence.
Any party may change its address for notices hereunder by notice to
the other parties in accordance with this Section 9.2.
9.3 GOVERNING LAW. This Agreement shall be governed by and
interpreted in accordance with the laws of the State of Connecticut applicable
to agreements made and to be performed entirely within such state.
9.4 ENTIRE AGREEMENT; AMENDMENTS AND WAIVERS. This instrument
is the entire agreement of the parties with respect to the subject matter hereof
and may not be amended, supplemented, canceled or discharged except by written
instrument executed by both parties hereto. The parties do not intend to confer
any benefit hereunder on any third person, and, without limiting the generality
of the foregoing, the parties may, in writing, without notice to or consent of
any third person, at any time waive any rights hereunder or amend this Agreement
in any respect or terminate this Agreement. If either party should waive any
breach of any provision of this Agreement, such party will not thereby be deemed
to have waived any preceding or succeeding breach of the same provision or any
breach of any other provision of this Agreement.
9.5 VALIDITY. The invalidity or unenforceability of any
provision or provisions of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement, which shall remain in
full force and effect.
9.6 ASSIGNMENT. This Agreement, and any rights and obligations
hereunder, may not be assigned by any party hereto without the prior written
consent of the other party.
9.7 HEADINGS. Section headings are inserted herein for
convenience only and do not constitute a party, and shall not affect the
interpretation, of this Agreement.
9.8 COUNTERPARTS. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original and all of which
together shall constitute one and the same instrument.
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9.9 SURVIVAL. Paragraphs 6, 7 and 8 and those provisions of
Paragraph 5 regarding compensation of the Executive following termination of
employment, shall survive and continue in full force in accordance with their
terms notwithstanding any termination of the Employment Period.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the day and year fist above written.
NFO RESEARCH, INC.
By:
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Name: Xxxxxxx X. Xxxxxx
Title: Chairman and Chief
Executive Officer
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Xxxxxxx X. Xxxxxx
