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EXHIBIT gg
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT ("AGREEMENT"), is dated as of February 16,
1999, between Information Resources, Inc., a Delaware corporation (the
"Company"), and Xxxx X. Xxxxxxx ("Consultant");
R E C I T A L S
WHEREAS, Consultant has served as Chief Executive Officer of the
Company and has acknowledged skills and experience in the business conducted by
the Company; and
WHEREAS, Consultant has submitted his resignation as Chief Executive
Officer of the Company, such resignation being effective as of November 21,
1998; and
WHEREAS, Consultant is willing and able to render services to the
Company, from and after the date hereof, on the terms and conditions set forth
in this Agreement.
A G R E E M E N T S
NOW, THEREFORE, in consideration of the premises and the mutual
agreements, provisions and covenants contained in this Agreement, the Company
and Consultant hereby agree as follows:
1. CONSULTING DUTIES.
(a) General Duties. During the Consulting Term, Consultant will report
directly to the Chief Executive Officer of the Company and will make himself
reasonably available to consult with the Company on matters relating to the
Company. Consultant will perform such services as the parties shall mutually
agree (which agreement Consultant shall not unreasonably withhold) for and on
behalf of the Company as shall be requested from time-to-time by the Chief
Executive Officer. Such services shall consist principally of (a) transitional
matters and (b) assistance in the maintenance and development of client and
employee relationships, in order to preserve the goodwill and existing
relationships between the Company, and its customers and employees. Consistent
with Consultant's obligations hereunder, Consultant shall not be prohibited from
engaging in other consulting and employment opportunities with other persons
except to the extent prohibited by Section 6 below.
(b) Cooperation. During the Consulting Term (as defined in Section 2
below) and thereafter (regardless of the reason for termination of the
Consulting Term), if requested by the Company, Consultant will cooperate fully
with respect to any claims, litigations or investigations currently pending or
to be brought by or against the Company as to which Consultant may have
knowledge of the facts and circumstances, which cooperation will include, but
not be limited to, providing testimony both by deposition, and at any trial or
related hearing. This obligation shall survive the termination or expiration of
this Agreement.
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(c) Consultant shall cooperate with the Company with respect to
miscellaneous issues that may arise in connection with Consultant's resignation
and the resulting transition, including tendering resignations from positions as
officers and\or directors of affiliated entities and transferring to the Company
equity interests in such affiliated entities that are held by Consultant in a
nominee or similar capacity.
2. TERM OF CONSULTING SERVICES.
Unless terminated as provided in Section 3 hereof, Consultant's
obligation to provide consulting services hereunder shall terminate on the
earlier of the third anniversary of the effective date of Consultant's
resignation as Chief Executive Officer of the Company or Consultant's death (the
"Consulting Term").
3. TERMINATION.
(a) By the Company. This Agreement as it relates to Consultant's
obligation to render services hereunder may be terminated at any time at the
option of the Company for cause (as such term is hereinafter defined), effective
upon the giving of written notice of termination to Consultant. As used herein,
the term "for cause" shall mean and be limited to: (i) any felony conviction;
(ii) the willful misconduct or gross negligence by Consultant in connection with
the performance of Consultant's duties, responsibilities, agreements and
covenants hereunder, or Consultant's refusal to render the consulting services
to the Company as required by Section 1 hereof, which misconduct, negligence or
refusal to so comply shall continue for a period of 45 days after written notice
from the Company; or (iii) the breach of Sections 5 or 6 of this Agreement.
(b) By Consultant.
(i) For Good Reason. Consultant may terminate this Agreement at
any time for Good Reason (as such term is defined below) effective on
the giving of written notice of termination to the Company. As used
herein, "Good Reason" shall mean and be limited to the Company's
material breach of its obligations hereunder which breach shall
continue for a period of 45 days after written notice from Consultant.
(ii) Upon Notice. Consultant may terminate this Agreement as it
relates to his obligation to render services hereunder after the first
anniversary of this Agreement by giving the Company 60 days prior
written notice of such election to terminate.
(c) Survival of Terms. The termination of this Agreement by either
party as set forth in Section 3(a) or 3 (b)(ii) above shall not serve to
terminate Consultant's obligations under Sections 1(b), 1(c), 5 or 6 hereof. If
Consultant terminates the Agreement pursuant to Section 3(b)(i), it shall
terminate Consultant's obligations under Sections 1(b), 5 and 6 hereof.
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(d) At Consultant's option, upon written notice to the Company prior
to July 31, 1999, except as set forth in the last sentence of this Section 3(d)
this Agreement shall terminate in its entirety and have no further force and
effect if, (i) the Board of Directors of the Company has not approved the
principal terms of a mutually acceptable joint venture arrangement among the
Company and Consultant or (ii) if such approval is obtained, the definitive
agreements reflecting such joint venture arrangement have not been agreed to
prior to June 30, 1999. Notwithstanding the foregoing, Consultant shall not be
entitled to terminate this Agreement as contemplated in this Section 3(d) if, as
an alternative to such joint venture arrangement, the Company and Consultant
enter into a mutually acceptable data license arrangement on or before June 30,
1999 providing for the license of certain data to a business venture formed by
Consultant. Notwithstanding the termination of this Agreement pursuant to this
Section 3(d), the Company and Consultant agree that Section 5(a) will continue
to apply with respect to confidential information of the Company that is
disclosed to Consultant following the date of Consultant's resignation as Chief
Executive Officer and prior to the date of termination of this Agreement
pursuant to this Section 3(d).
4. COMPENSATION AND BENEFITS.
(a) Compensation. Unless Consultant's obligation to render services
hereunder has been terminated by the Company or Consultant as described in
Section 3(a) or 3(b)(ii), the Company shall pay and provide to Consultant for
each year during the Consulting Term, as compensation for the services to be
rendered by Consultant hereunder, (i) a consulting fee equal to [a] Consultant's
salary paid by the Company immediately prior to his resignation as chief
executive officer of the Company, plus [b] the incremental dollar amount, on an
after tax basis, of social security and unemployment compensation benefits
previously paid by the Company on Consultant's behalf, and (ii) make available
fringe benefits described in subsection (c) below. All payments provided under
this Agreement or any other agreement which may be or have been in effect are in
lieu of any severance payments or any other payments to which Consultant may be
entitled at any time. At Consultant's option, the Company shall direct payment
of the consulting fees to an entity wholly or partly owned by Consultant.
(b) Expenses. Unless Consultant's obligation to render services
hereunder has been terminated by the Company or Consultant as described in
Section 3(a) or 3(b)(ii), during the Consulting Term the Company shall,
consistent with the expense reimbursement policy in effect from time to time,
reimburse Consultant, upon presentment by Consultant to the Company of
appropriate receipts and vouchers, for any reasonable business expenses incurred
by Consultant in connection with the performance of his duties specifically
requested by the Company hereunder (including reimbursement of business related
telephone charges). As part of such reimbursement plan and consistent with past
practice, Consultant shall be entitled to reimbursement of first class business
travel (including lodging) expenses incurred by him if and to the extent such
reimbursement practice remains consistent with the travel reimbursement practice
in place for other senior executive officers of the Company.
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(c) Fringe Benefits. For the purposes of this Agreement, the term
"fringe benefits" shall exclude any salary, bonus or incentive compensation or
outside directors fees, but shall include benefits under health and welfare
plans, life insurance, auto insurance, disability and retirement plans and
executive deferred compensation plans and the other benefits and perquisites
historically provided to Consultant. During the Consulting Term, Consultant
shall be acting as an independent contractor of the Company. The Company shall
not be required to make any social security, state or federal unemployment
compensation payments required by law. Unless (i) Consultant's obligation to
render services hereunder has been terminated by the Company or Consultant as
described in Section 3(a) or 3(b)(ii), or (ii) Consultant's participation in any
such fringe benefit plan is prohibited by law or would cause such plan to be
disqualified as a tax qualified plan, during the Consulting Term the Company
shall make available to Consultant all fringe benefits made available to
Consultant immediately prior to his resignation as chief executive officer of
the Company. Such fringe benefits shall made available in amounts and consistent
with the terms made available to Consultant immediately prior to such
resignation. If such a fringe benefit is terminated or discontinued by the
Company and is replaced by a comparable fringe benefit and Consultant's
participation in such comparable plan would not be prohibited by law or cause
such plan to be disqualified as a tax qualified plan, then Consultant shall be
entitled to participate in such fringe benefit during the Consulting Term in
amounts and consistent with the terms generally made available by the Company to
other senior executive officers of the Company. During the Consulting Term, the
Company shall make a cash payment to Consultant equal to the amount of the
matching payment the Company would have made to the Company 401(k) plan had
Consultant been an employee of the Company. The Company shall provide Consultant
with reasonable dedicated office facilities and secretarial and other
administrative assistance to the extent necessary to permit Consultant to
adequately render the consulting services contemplated hereby. Consultant shall
be entitled to retain and use during the Consulting Term the portable phone,
laptop computer and residential fax machines previously provided to Consultant
and, upon termination of the Consulting Term, shall be entitled to purchase such
equipment from the Company at its then book value. Assuming Consultant continues
to qualify for such benefit, Consultant shall be entitled to maintain his
"platinum" status through the Company's travel plan with American Airlines and
Hertz.
(d) Stock Options. If during the Consulting Term, the Company acts to
reprice (through the cancellation and re-grant of options, or otherwise) stock
options previously granted to all of its directors and executive officers
(within the meaning of the Securities Act of 1934), the Company shall similarly
reprice options held by Consultant on the same basis as such directors and
executive officers. Except to the extent the 10-year term of such options
terminate pursuant to the terms of the applicable option plan, all options held
by Consultant shall remain exercisable through, and shall terminate on, the
termination or expiration of the Noncompete Period.
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5. CONFIDENTIAL INFORMATION.
(a) Disclosure and Use. The Company and the Consultant acknowledge
that during his employment with the Company and in the performance of his
consulting duties hereunder, the Consultant has learned and may learn certain
information not generally known within the Company's industry that must be kept
confidential. Consultant agrees that he shall maintain in strict confidence all
such confidential or proprietary information which has been or may be obtained
prior to or during the Consulting Term concerning the Company or the Company's
business, including specific lines and methods of doing business, specific
processes, programs, data, software and techniques which consist of or involve
business information, as well as confidential client information.
Notwithstanding the foregoing, Consultant shall be entitled to use, exploit,
publish and disclose, in a manner which does not otherwise violate the terms and
provisions of this Agreement, any information which (i) is or becomes generally
available to the public through no fault or action by Consultant, or (ii) is or
becomes available to Consultant from a source, other than the Company, or (iii)
is subject to disclosure pursuant to applicable law, for instance in response to
a subpoena or court or administrative order, or (iv) is used in a manner which
maintains its confidentiality in connection with the business activities
conducted by the joint venture or other business initiative entered into by the
Company and Consultant, if any. Consultant further agrees to return all
programs, manuals, documents, records and other information relating to the
business of the Company, including materials prepared or obtained by Consultant,
in his capacity as same, during the Consulting Term, immediately upon the
termination of the Consulting Term.
(b) Ideas and Improvements. Consultant agrees promptly to disclose to
the Company all ideas, designs, improvements, creations and inventions, whether
or not patentable, or subject to other legal protection, which have significant
relationship to the Company's business which were developed and created by
Consultant for the Company directly as part of his Consulting Duties during the
Consulting Term (collectively, "Ideas and Creations"). Consultant further agrees
to take all steps necessary to execute and deliver to the Company copyright or
patent rights on all matters suitable for such protection, if any, and to
execute and deliver to the Company all documents which may be required to assign
to the Company such copyright or patent rights, if any, and to otherwise
cooperate to the extent within Consultant's control to ensure the Company' use
and enjoyment of such Ideas and Creations, provided that there is no obligation
for the Consultant to assign an invention for which no equipment, supplies,
facility or trade secret information of the Company was used and which was
developed entirely on Consultant's own time, unless (a) the invention relates
directly to the Consultant's Consulting Duties and (b) the invention results
from Consulting Duties performed by Consultant for the Company.
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6. RESTRICTIVE COVENANT.
During the Noncompete Period (as defined below), Consultant shall not,
without the prior written consent of the Company, directly or indirectly, for
himself or for any other person or entity, individually, jointly or as a
partner, stockholder (except as a holder of not more than five percent (5%) of
the outstanding shares of a publicly-held corporation), employee, agent,
consultant or otherwise:
(a) work or perform any service for Dun & Bradstreet Corporation,
ACNielsen Corporation, Efficient Market Services, Inc., Paragren Technologies,
Inc., IMS International, Inc., Spectra Marketing (or any of the other market
research businesses of VNU) or any parent, subsidiary, affiliate or successor of
any of the foregoing;
(b) induce, attempt to induce, or participate in or facilitate the
inducing of or attempting to induce, any employee, officer, director,
consultant, sales representative or agent of the Company to terminate or alter
his or her business relationship with the Company or to breach any agreement or
obligation he or she has with or to the Company or to perform work or services
for the Consultant or for a competitor of the Company described in Section 6(a),
or, without the prior written consent of the Company (which shall not be
unreasonably withheld) hire any such person within 12 months of the termination
of such business relationship (unless the Company has previously terminated such
employee). Notwithstanding the foregoing, Consultant shall be free to hire any
former employee of the Company within 12 months of the termination of his/her
employment with the Company if (i) such employee terminated his/her employment
with the Company prior to November 23, 1998; and (ii) the Company is not also
involved in good faith negotiations to re-hire such former employee; or
(c) except with the Company's prior written consent (which consent
shall not be unreasonably withheld), attempt in any manner to persuade any
customer or supplier of the Company to cease or reduce the amount of business
which such customer or supplier engages in or contemplates engaging in with the
Company, regardless of whether the relationship between such customer or
supplier and the Company was originally established in whole or in part through
Consultant's efforts.
Consultant acknowledges that the restrictions set forth in this
Agreement are (x) reasonable and necessary for the protection of the Company'
interests and (y) are entered into by Consultant in exchange for adequate
consideration granted to him in connection with this Agreement. In the event
that any provision of this Section 6 is found by a court of competent
jurisdiction to be unreasonable or unenforceable, the parties agree that such
provision shall be enforceable against Consultant to the greatest extent that
would be found to be reasonable and enforceable.
For purposes hereof, the term "Noncompete Period" shall mean three
years from the effective date of Consultant's resignation as Chief Executive
Officer of the Company.
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Notwithstanding the foregoing, if Consultant terminates this Agreement pursuant
to Section 3(b)(ii), the Noncompete Period shall be the earlier of (i) one year
following the effective date of such termination and (ii) three years from the
date of Consultant's resignation as chief executive officer of the Company. In
addition, the Noncompete Period shall terminate if Consultant terminates this
Agreement pursuant to Section 3(b)(i) hereof.
7. SEVERABILITY.
If any provision of this Agreement is held invalid or unenforceable,
either in its entirety or by virtue of its scope or application to given
circumstances, such provision shall thereupon be deemed modified only to the
extent necessary to render same valid, or not applicable to given circumstances,
or excised from this Agreement, as the situation may require, and this Agreement
shall be construed and enforced as if such provision had been included herein as
so modified in scope or application, or had not been included herein, as the
case may be.
8. LEGAL REMEDIES.
Consultant hereby acknowledges that the Company would suffer
irreparable injury if the provisions of paragraphs 5 and 6 above, which shall
survive the termination of this Agreement, were breached and that the Company's
remedies at law would be inadequate in the event of such breach. Accordingly,
Consultant hereby agrees that any such breach or threatened breach may, in
addition to any and all other available remedies, be preliminarily enjoined by
the Company without bond. In the event of litigation under this Agreement, each
of the Company and Consultant shall pay his or its own attorneys' fees and
expenses.
9. NON-ASSIGNABILITY.
In light of the unique personal services to be performed by Consultant
hereunder, it is acknowledged and agreed that any purported or attempted
assignment or transfer by Consultant of this Agreement or any of Consultant's
duties, responsibilities or obligations hereunder shall be void.
10. NOTICES.
Any notice, request, demand or other communication required or
permitted under this Agreement shall be in writing and shall be deemed to have
been given when delivered personally or when mailed by certified mail, return
receipt requested, addressed as follows:
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If to the Company:
Information Resources, Inc.
000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Chief Executive Officer
If to Consultant:
Xxxx X. Xxxxxxx
00 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
or to such other address or addresses as may be specified from time to time by
notice; provided, however, that any notice of change of address shall not be
effective until its receipt by the party to be charged therewith.
11. GENERAL.
(a) Amendments. Neither this Agreement nor any of the terms or
conditions hereof may be waived, amended or modified except by means of a
written instrument duly executed by the party to be charged therewith.
(b) Captions and Headings. The captions and paragraph headings used in
this Agreement are for convenience of reference only, and shall not affect the
construction or interpretation of this Agreement or any of the provisions
hereof.
(c) Governing Law. This Agreement, and all matters or disputes
relating to the validity, construction, performance or enforcement hereof, shall
be governed, construed and controlled by and under the laws of the State of
Illinois without regard to principles of conflicts of law.
(d) Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective heirs,
executors, administrators, personal representatives, successors and permitted
assigns.
(e) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original hereof, but all of
which together shall constitute one and the same instrument.
(f) Entire Agreement. Except as otherwise set forth or referred to in
this Agreement, this Agreement constitutes the sole and entire agreement and
understanding between the parties hereto as to the subject matter hereof, and
supersedes all prior discussions, agreements and
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understandings of every kind and nature between them as to such subject matter.
Except as provided herein, it is understood that this Agreement supersedes any
prior employment compensation agreement, whether written, oral or implied in law
or implied in fact between Consultant and the Company (including, but not
limited to, that certain letter agreement, dated March 24, 1981, between the
Company and Consultant).
(g) Reliance by Third Parties. This Agreement is intended for the sole
and exclusive benefit of the parties hereto and their respective heirs,
executors, administrators, personal representatives, successors and permitted
assigns, and no other person or entity shall have any right to rely on this
Agreement or to claim or derive any benefit therefrom absent the express written
consent of the party to be charged with such reliance or benefit.
[signature page follows]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
and of the date first set forth above.
INFORMATION RESOURCES, INC.
By:
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Name:
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Title:
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Xxxx X. Xxxxxxx
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