1
June 5, 2000
Xxxxxxx X. Xxxxxxx
Primark Corporation
0000 Xxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Dear Xxxx:
This letter is intended to set forth the agreement between Primark
Corporation (the "Company") and you concerning your employment by the Company
after the Effective Time (as defined in the Agreement and Plan of Merger (the
"Merger Agreement"), dated as of June 5, 2000, by and among The Thomson
Corporation, the Company and Marquee Acquisition Corporation), and certain
clarifications and amendments to the Amendment to Change of Control Compensation
Agreement, dated September 29, 1997, between the Company and you (the "Change of
Control Agreement"). Capitalized terms used herein, but not defined herein, have
the meanings assigned to them in the Change of Control Agreement.
1. OCCURRENCE OF A CHANGE OF CONTROL.
The Company acknowledges that a Change of Control will occur as of the
Effective Time for purposes of your Change of Control Agreement. Except as
provided in Section 3 below, you agree not to resign for any reason on or prior
to the Effective Time.
2. DUTIES ON AND AFTER THE EFFECTIVE TIME.
From the date hereof until the later of the Effective Time and January
1, 2001 (the "Transition Period"), you shall continue to serve as Executive Vice
President, General Counsel and Secretary of the Company and you expressly agree
that you shall not have Good Reason to resign from the Company pursuant to the
Change of Control Agreement as a result of changes in your status, authority or
responsibilities that are a consequence solely of your no longer being an
officer of a public company. Accordingly, you shall only be deemed to have an
assignment of duties inconsistent with your status as a senior executive officer
of the Company, or a substantial adverse alteration in the nature or status of
your responsibilities, as contemplated by Section
2
11(c)(1) of the Change of Control Agreement, if you are required to perform your
duties at a location greater than five miles from the existing location or your
duties are materially inconsistent with those commonly associated with a
Executive Vice President, General Counsel and Secretary of a subsidiary,
division or operating entity of a public company, as such duties are reasonably
interpreted by you.
3. SEVERANCE UPON TERMINATION WITHOUT CAUSE OR RESIGNATION FOR
GOOD REASON OR AT END OF THE TRANSITION PERIOD.
The Change of Control Agreement, as amended by this letter, shall be
the sole document governing the payment of severance in connection with the
termination of your employment with the Company for any reason, and,
accordingly, you shall not be entitled to any severance benefits described in
any other agreements, plans, policies or arrangements of the Company, including,
without limitation, any employment agreement that you may have entered into with
the Company. You expressly agree that, upon a termination of your employment by
the Company without Cause or a resignation by you for Good Reason during the
Transition Period, you shall only be entitled to the severance benefit described
in Section 3 of the Change of Control Agreement, as amended by this letter. In
the event that you have been continuously employed by the Company through the
end of the Transition Period, you shall be entitled to the benefit described in
Section 3 of the Change of Control Agreement, as amended by this letter, as soon
as practicable following the Transition Period. Thereafter, if you remain
employed by the Company, your employment shall not be governed by the Change of
Control Agreement or the Employment Agreement, and if your employment is severed
for any reason thereafter, you will be entitled to no severance under any
programs of the Company or any of its affiliates, except as may otherwise be
provided subsequent to the date hereof
4. MODIFICATION OF CALCULATION OF SEVERANCE BENEFIT.
To the extent that severance benefits do become payable to you pursuant
to Section 3 of the Change in Control Agreement, as amended by this letter, you
agree that the severance benefit payable to you shall be an amount equal to
three times the average of the aggregate of your annual salary, bonus and
benefits as set forth in your form W-2 (excluding any stock option gains,
whether or not included in your form W-2) paid to you and includable in your
gross income during the lesser of: (i) the five calendar years preceding the
Effective Time or (ii) the portion of such five year period during which the
Company existed and you were an employee of the Company.
3
5. CLARIFICATION OF BENEFIT SERVICE PROVISION.
You agree that the final paragraph of Section 3(b) of the Change of
Control Agreement, which contemplates the granting of additional consideration
and three additional years of service under employee benefit and welfare plans
and arrangements upon a Change of Control, shall be solely applicable to the
Company's Supplemental Death Benefit and Retirement Income Plan and Agreement as
Amended and Restated, dated March 25, 1985, to the extent that you are a
participant in such plan.
6. RESTRICTIVE COVENANTS.
(a) You acknowledge that (i) the Company is engaged and in the future
will be engaged in certain businesses as of the Effective Time (the foregoing,
together with any other businesses that the Company or its affiliates over which
you have responsibility under this agreement may engage in from the date hereof
to the date of the termination of this agreement, being hereinafter referred to
as the "Company Business"); (ii) your services to the Company have been and will
be, special and unique; (iii) your work for the Company has and will give you,
access to trade secrets of and confidential information concerning the Company;
(iv) the Company Business is national and international in scope; (v) the Parent
would not have entered into the Merger Agreement but for the agreements and
covenants contained in this Section 6; and (vi) the agreements and covenants
contained in this Section 6 are essential to protect the business and goodwill
of the Company. In order to induce the Company to enter into this agreement and
the Parent to enter into the Merger Agreement, you covenant and agree that:
(b) In consideration for the payments provided for hereunder, during
the term of your employment agreement and for a period equal to one year after
the termination or expiration of your employment by the Company, however caused,
(the "Restricted Period"), you shall not, other than as specifically provided in
this agreement directly or indirectly, (i) engage in the Company Business as
conducted on the date hereof or as it may hereafter be conducted during the
course of your employment, or a business competitive with the Company Business;
(ii) assist any person in conducting a business competitive with the Company
Business, PROVIDED, HOWEVER, that this is not intended to restrict your
ownership of up to 1% of the securities of a publicly traded company that
engages in the Company Business; (iii) interfere with business relationships
(whether formed heretofore or hereafter) between the Company and customers of or
suppliers to the Company Business. You agree that, in the event of a breach or
threatened breach by you of this section, the Company shall be entitled to seek
injunctive relief restraining the breaching party from engaging in any of the
aforesaid prohibited activities. Nothing hereunder, however, shall be construed
as prohibiting the Company from pursuing any other remedies available to it in
law or in equity.
4
(c) During and after the Restricted Period, you shall keep secret and
retain in strictest confidence, and shall not use for the benefit of yourself or
others, except in connection with the business and affairs of the Company and
its affiliates, all confidential information relating to the Company Business or
to the Company or to the business of any of the Company?s affiliates, including,
but not limited to, "know-how," trade secrets, customer lists, subscription
lists, details of consultant contracts, pricing policies, operational methods,
marketing plans or strategies, product development techniques or plans, business
acquisition plans, technical processes, new personnel acquisition plans,
processes, designs and design projects, inventions, software, source codes,
object codes, system documentation and research projects and other business
affairs relating to the Company Business or to any affiliate of the Company
learned by you heretofore or hereafter, and shall not disclose them to anyone
outside of the Company and its affiliates, either during or after employment by
the Company or any of its affiliates, except (i) as required in the course of
performing your duties hereunder, or (ii) with the Company's express written
consent, or (iii) pursuant to legal process. Notwithstanding the foregoing, your
obligations in this Section 6(c) shall not apply to confidential information:
(A) which at the date hereof or thereafter becomes a matter of
public knowledge without breach by you of this Agreement; or
(B) which is obtained by you from a person other than the Company
or an affiliate of the Company who is under no obligation of
confidentiality to the Company.
(d) During the Restricted Period and so long as you are employed by the
Company, you shall not, directly or indirectly, (a) hire, solicit or encourage
any employee other than your assistant to leave the employment of the Company or
any of its affiliates or (b) hire any such employee who has left the employment
of the Company or any of its affiliates within one year of the termination of
such employee's employment with the Company or any of its affiliates except for
Xxxxxx X. Xxxxxxxx, Xxxxxx X. Xxxxxx and your assistant.
(e) Upon termination of your employment with the Company, all
documents, records, notebooks, and similar repositories of or containing trade
secrets or intellectual property then in your possession, including copies
thereof, whether prepared by you or others, will be promptly returned to or left
with the Company.
(f) If you breach, or threaten to commit a breach of, any of the
provisions of this Section 6 (the "Restrictive Covenants"), the Company shall
have the right and remedy to have the Restrictive Covenants specifically
enforced by any court having equity jurisdiction, it being acknowledged and
agreed that any such breach or threatened breach will cause irreparable injury
to the Company and that money damages will not provide adequate remedy to the
Company. Such rights and remedies shall be in addition to, and not in lieu of,
any other rights and remedies available to the Company under law or in equity.
5
(g) These covenants shall supersede any restrictive covenants
applicable to you in any other agreements, plans, programs or arrangements.
7. EFFECT ON OTHER AGREEMENTS.
Except as clarified or modified herein, the Change of Control Agreement
and other agreements referred to herein shall not be effected by this agreement.
8. GOVERNING LAW.
This agreement shall be governed by and construed in accordance with
the laws of the State of New York, without regard to its conflicts of laws
provisions.
9. SEVERABILITY.
If any term or other provision of this agreement is invalid, illegal or
incapable of being enforced by any law or public policy of any jurisdiction
where applicable but for such invalidity, illegality or unenforceability, such
invalidity, illegality or unenforceability shall not invalidate all of the
provisions of this agreement but rather this agreement shall be construed,
insofar as the law or public policy of such jurisdiction is concerned, as not
containing the invalid term or provision and all other terms and provisions of
this agreement shall nevertheless remain in full force and effect to the fullest
extent permissible under such law or public policy.
IN WITNESS WHEREOF, the parties hereto have executed this agreement as
of the Effective Date.
By: /s/ Xxxxxx X. Xxxxxxxx
---------------------------------------
PRIMARK CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------------------
Xxxxxxx X. Xxxxxxx
