Exhibit 99.13
NFO WORLDWIDE, INC.
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made as of March 1, 1999, by and between NFO Worldwide, Inc.,
a Delaware corporation (the "Company"), and Xxxxxx X. Xxxxxxxx (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 President y North American Operations 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
President y North American Operations 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 President y North
American Operations 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's subsidiary,
Xxxxxxxx/Xxxxxx Associates, Inc., subject to reasonable travel requirements on
behalf of the Company.
4. COMPENSATION AND BENEFITS.
4.1 COMPENSATION. As compensation for services to be rendered
pursuant to this Agreement, the Company shall pay the Executive a salary at the
annual rate of no less than
$300,000 (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 ANNUAL RETIREMENT BENEFIT. Beginning January 1, 2004 and
continuing each year until December 1, 2013 (the "Benefit Period") the Company
shall pay to the Executive an annual retirement benefit in the amount of
$150,000 in twelve monthly installments (the "Annual Retirement Benefit"). The
amount of the Annual Retirement Benefit for each year payable by the Company
during the Benefit Period shall be reduced, but not below zero, by an amount
equal to the sum of (i) the amount received during such year by the Executive
from the United States Social Security Administration; (ii) Company's pension
plan, (iii) Companyys executive deferred compensation plan, (iv) Companyys
profit sharing plan and 401(k) plan; and amounts received under a deferred
compensation plan that the Company will establish and fund (using a yrabbi
trusty) in the amount of $185,000 per year for the duration of this three year
Employment Period; provided, however, that to the extent commencement of
benefits under any of the foregoing plans or arrangements is elective and
Executive does not elect to commence such benefits on or before the beginning of
the Benefit Period, then until such time as Executive actually begins to receive
benefits under such plans or arrangements the Executive shall be deemed to have
commenced receiving the maximum possible benefits thereunder at the beginning of
the Benefit Period under such plans for purposes of calculating to what extent
the Company has an obligation to pay any additional amounts toward the Annual
Retirement Benefit.
4.3 BONUS. The Executive's incentive compensation package
("Annual Bonus") shall be determined by the Compensation Committee of the Board.
4.4 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
that the Executive currently receives, all group life, hospitalization or
disability insurance plans, health programs, pension plans, profit sharing
plans, similar benefit plans, automobile 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 Employ-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.
4.5 VACATIONS. The Executive shall be entitled to reasonable
nonaccumulating annual periods of vacation (not less than an aggregate of four
weeks in any calendar year) with full pay.
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4.6 COUNTRY CLUB MEMBERSHIP. During the Employment Period, the
Company shall pay all of the Executive's fees, bonds and annual dues for a
country club membership. All personal expenses are to be paid by the Executive.
4.7 TERM INSURANCE. During the Employment Period, the Company
shall provide the Executive with a term life insurance policy consistent with
the policies of the Company's other members of the Office of the President,
providing coverage of $400,000 payable to a beneficiary to be designated by the
Executive.
5. TERM.
(a) The Employment Period shall end on April 1, 2002, 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 or the Employment Period is terminated, at any time prior
to a "Change in Control," by the resignation of the Executive for the reason
specified in subsections (i) or (iv) of the definition of "Good Reason" (subject
to the cure period contained in such definition), the Executive shall be
entitled to receive his Base Salary through April 1, 2002; PROVIDED, HOWEVER,
that the Executive shall only be entitled to receive his Base Salary so long as
he has not materially breached the provisions of paragraphs 6, 7 and 8 hereof.
(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 in 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) April 1, 2002, 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 prorated 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 in 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
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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 President y North
American Operations, 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 President y North
American Operations; (ii) the Company fails to pay the Executive any amounts
otherwise due hereunder; (iii) the Executive's Base Salary is reduced or his
Fringe Benefits are reduced; or (iv) the Company's requiring the Executive to
move his primary place of employment to a location that is 50 miles or more from
Xxxxxxxx/Xxxxxx Associates, Inc. headquarters in Owings Mills, Maryland;
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 Worldwide,
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.
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(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 and its predecessors
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 afore-mentioned matters are or become generally known
to and available for use by the members of the 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 and 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
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Executive agrees that, during the Employment Period and in the case of (x)
termination for Cause, resignation (other than resignation for "Good Reason"
following a "Change in Control") or, if applicable, the expiration (and
non-renewal) of the Employment Period on April 1, 2002, for three years
thereafter, or (y) termination without Cause, during the period in which the
Executive receives payment of Base Salary pursuant to Section 5(b) (without
regard to the proviso contained therein) (the applicable period being referred
to herein as the "Initial Noncompete Period"), he shall not directly or
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 (any of the foregoing,
to "Compete"), within any geographical area in which the Company or its
subsidiaries engage or plan to engage in such businesses. In addition, the
Executive agrees that he shall not Compete in any such geographical area during
the two years following the termination of the Initial Noncompete Period (the
"Limited Noncompete Period" and, together with the Initial Noncompete Period,
the "Noncompete Period"); PROVIDED, HOWEVER, that the Executive may perform
consulting services during the Limited Noncompete Period so long as any such
consulting services provided to any Client (as defined below) of the Company or
its subsidiaries (collectively, the "Companies"), are not the same as,
substantially similar to, or otherwise compete with, services offered by any of
the Companies. For purposes of this Section 8, the term "Client" shall mean a
person or entity who on the date of the termination of the Executive's
employment is a client of any of the Companies, or was a client of any of the
Companies at any time during the three years prior to such date. The Company and
the Executive agree, that in providing the consulting services referred to in
the proviso above, the Executive (i) may employ commonly accepted "generic
market research techniques" (such as focus groups), (ii) may not promote, use or
sell proprietary techniques, sales materials, programs or software of any of the
Companies or any techniques, sales materials, programs or software derived
therefrom and (iii) may not promote or position such services in a manner that
competes with any of the Companies. 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 Employment Period, Noncompete Period and, if
applicable, for the period of three years following the expiration (and
non-renewal) of the Employment Period on April 1, 2002, 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 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.
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(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 Worldwide, Inc.
0 Xxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
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.
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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 Employment Agreement dated as of
December 1, 1997 between the Company and the Executive is hereby terminated as
of the date hereof and is replaced hereby. 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 part, 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.
9.9 SURVIVAL. Paragraphs 6, 7 and 8 and those provisions of
Paragraph 5 regarding compensation of the Executive following termination of the
employment, shall survive and continue in full force in accordance with their
terms notwithstanding any termination of the Employment Period.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
NFO WORLDWIDE, INC.
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Chairman, President and
Chief Executive Officer
/s/ Xxxxxx X. Xxxxxxxx
-----------------------------------------
Xxxxxx X. Xxxxxxxx
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