RETIREMENT AGREEMENT
RETIREMENT AGREEMENT, dated as of May 22, 2000 (the "Agreement"), between
FactSet Research Systems Inc., a Delaware corporation (the "Company"), and
Xxxxxx X. Xxxxx (the "Executive").
WHEREAS, the Executive is employed by the Company on the terms and
conditions set forth in an employment agreement dated June 27, 1996 by and
between the Executive and the Company (the "Employment Agreement"); and
WHEREAS, the Executive currently serves as Chairman of the Board of
Directors of the Company ("Chairman") and as Chief
Executive Officer of the Company ("Chief Executive Officer"); and
WHEREAS, the Executive desires to retire from active employment with the
Company effective May 22, 2000 (the "Retirement Date"); and
WHEREAS, the Company desires to reward the Executive for his 22 years of
service with the Company as Chairman and Chief Executive Officer;
NOW, THEREFORE, in consideration of the premises set forth herein, the
Executive and the Company, intending to be legally bound hereby, do hereby agree
as follows:
1. Retirement by the Executive.
(1) The Executive has elected to retire as an employee and officer of the
Company and any of its subsidiaries or affiliates as of the Retirement Date.
(2) The Executive shall continue as the non-executive Chairman of the Board
of Directors (the "Board") until August 31, 2000, or such earlier date on which
the Executive may resign as Chairman of the Board.
2. Termination of the Employment Agreement. By mutual agreement, the
Employment Agreement shall be terminated, effective as of the Retirement Date,
and from such date the Employment Agreement shall be void and of no force and
effect.
3. Compensation and Benefits. During the period that the Executive serves
as Chairman of the Board (the date such service terminates for any reason, the
"Chairman Termination Date"), the Company shall provide the Executive with
periodic cash compensation at the rate of $350,000 per year and the Company
shall continue to provide the Executive (and his spouse and dependants, if
applicable) with medical and dental benefits substantially equivalent to the
benefits he was entitled to receive immediately prior to the Retirement Date.
The Company shall give the Executive the right to purchase (such right to remain
open until the Chairman Termination Date) at current book value, the Company
vehicles which were customarily provided to the Executive immediately prior to
the Retirement Date.
4. Benefits following Termination of Board Service. For a period of thirty
six months immediately following the Chairman Termination Date, the Company
shall continue to provide the Executive (and his spouse and dependents, if
applicable) with medical and dental benefits as described in Section 3 of this
Agreement.
5. Special Retirement Payment. In recognition of the Executive's
contributions to the success of the Company, no later than five business days
following the Chairman Termination Date, the Company shall pay the Executive (or
if applicable, his estate or legal representative) a special retirement payment
of $2,750,000, in a lump sum in cash.
6. Gross-Up Payment for Excise Tax. If any of the payments or benefits
received or to be received by the Executive pursuant to the terms of this
Agreement or any other Company plan, arrangement or agreement (such payments or
benefits, excluding the Gross-Up Payment (as defined below), the "Total
Payments") will be subject to the excise tax imposed under Section 4999 of the
Internal Revenue Code (or any successor provision), the Company shall pay to the
Executive an additional amount (the "Gross-Up Payment") such that the net amount
retained by the Executive, after deduction of any excise tax on the Total
Payments and any federal, state and local income and employment taxes and excise
tax upon the Gross-Up Payment, shall be equal to the Total Payments. Any
calculation required to be made in respect of the foregoing shall be determined
initially by a nationally recognized firm of independent public accountants
retained by the Executive at the Company's expense, and such determination and
the basis therefor shall be furnished in writing to the Executive and the
Company. Payment shall be made by the Company in accordance with that initial
determination regardless whether there is a dispute over the accuracy thereof.
If either party disputes that initial determination the matter shall promptly be
referred to a nationally recognized firm of independent public accountants
selected by the Executive (which firm shall not have been involved in the
initial determination), and the Executive and the Company shall promptly furnish
to that firm such information as it reasonably requests. The Company shall make
such additional payment to the Executive or the Executive shall refund an amount
to the Company, as the case may be, in accordance with the latter firm's
determination. The fees and expenses of that firm shall be borne by the Company.
7. Release by the Executive.
(1) The Executive, on behalf of himself, his family, heirs, executors,
administrators, legal representatives and assignees hereby releases the Company,
its parents, subsidiaries and other affiliates, its (and its parents',
subsidiaries' and other affiliates') present or former employees, officers,
directors, stockholders, representatives and agents from all claims and demands
the Executive has had or presently has against the Company and its parents,
subsidiaries and other affiliates, including any rights or claims the Executive
may have based on or pertaining to his Employment Agreement or otherwise based
on any facts or events, whether known or unknown by the Executive, that have
occurred prior to the date of this Agreement.
(2) Nothing herein shall be deemed to release: (i) the Executive's right to
be reimbursed for ordinary and necessary business expenses incurred prior to the
Retirement Date but not previously reimbursed, (ii) salary, benefits and
perquisites payable to the Executive (including, but not limited to, accrued and
unpaid vacation days) with respect to a period prior to the Retirement Date
which have not been previously paid up to the Retirement Date, (iii) the
Executive's rights under this Agreement or (iv) any of the benefits that the
Executive has accrued prior to the Retirement Date under the Company's employee
benefit plans. In addition, the Executive shall be entitled to reimbursement for
ordinary and necessary business expenses incurred following the date hereof in
connection with his service as a director in accordance with the Company's
policies in effect from time to time.
8. Release by the Company. As additional consideration hereunder, the
Company, its parents, subsidiaries and other affiliates (and their respective
successors and assigns) hereby release the Executive from all claims or demands
they have had or presently have against the Executive, including any rights or
claims based on any facts or events, whether known or unknown, that have
occurred prior to the date of this Agreement.
9. Indemnification.
(1) The Company hereby agrees that, with respect to any threatened, pending
or completed action or proceeding, whether civil, criminal, administrative or
investigative ("Proceeding") to which Executive is a party or is threatened to
be made a party by reason of the Executive's service as director, officer or
employee of the Company prior to the Chairman Termination Date ("Pre-Termination
Date Service"), the Executive is and shall be indemnified by the Company,
including without limitation, against expenses (including attorney's fees),
judgments, fines and amounts paid in settlement actually reasonably incurred by
him in connection with the defense or settlement of such Proceeding, to the
fullest extent of applicable law, the Company's by-laws and Company's articles
of incorporation (each of such by-laws and articles of incorporation as in
effect on the date hereof). The Company represents and warrants that, with
respect to the Pre-Termination Date Service, the Executive is a named insured
under the Company's Directors' and Officers' Liability Insurance Policy which
provides liability coverage for the directors and officers of the Company.
(2) The Executive shall be indemnified and held harmless with respect to
any Proceeding to which Executive is a party or is threatened to be made a party
by reason of the Executive's service to the Company on or after the date hereof
to the same extent that the Company indemnifies and holds harmless directors of
the Company.
10. Publicity. A press release in respect of the Executive's resignation as
Chief Executive Officer of the Company shall be issued by the Company and/or the
Executive in the form attached to this Agreement as Exhibit A. Except as
provided in this Section 10 or as required by law or stock exchange rule, the
Executive shall not divulge, and the Company shall use its best effort to cause
its officers, employees and agents not to divulge, to any other entity or person
(except in the case of the Executive, to his spouse, and in case of the Company
and the Executive to its, or his, legal and financial advisors) any information
concerning this Agreement or the terms thereof or the discussions relating
thereto.
11. Nondisparagement. The Company and the Executive shall refrain from
making any statements or taking any action which has the effect of demeaning the
name or reputation of the other, or which is injurious, or could reasonably be
expected to be injurious to the best interests (economic or otherwise) of the
other. For the purposes of this Section 11, the Company shall include its
affiliates, employees and directors.
12. Noncompetition; Confidentiality.
(1) The Executive agrees that while serving as Chairman of the Board and
for a period of two years following the Chairman Termination Date, the Executive
shall not, directly or indirectly, own, manage, operate, join or control, be
employed by or participate in the ownership, management, operation or control
of, or be a consultant to or connected in any other manner with, any business,
firm or corporation which is similar to or competes with a principal business of
the Company or its affiliates (a "Competitive Activity"). For these purposes,
the Executive's ownership of securities or a public company not in excess of
five percent (5%) of any class of such securities shall not be considered to be
a Competitive Activity.
(2) The Executive agrees to keep secret and retain in the strictest
confidence all confidential matters which relate to the Company or any
subsidiary or affiliate, including, without limitation, customer lists, client
lists, trade secrets, pricing policies, data bases and other nonpublic business
affairs of the Company and any subsidiary or affiliate learned by him from the
Company or any such affiliate or otherwise before or after the date of this
Agreement, and not to disclose any such confidential matter to anyone outside of
the Company or any of its affiliates.
13. Arbitration. Any dispute or controversy arising under or in connection
with this Agreement shall be settled exclusively by arbitration, conducted
before a panel of three arbitrators in New York, New York, in accordance with
the rules of the American Arbitration Association then in effect. Judgement may
be entered on the arbitrator's award in any court having jurisdiction. The
expense of any arbitration shall be borne by the Company. Notwithstanding the
foregoing, the Company may seek equitable relief in any court of competent
jurisdiction to prevent any violation of Section 11 or 12 of this Agreement and
the Executive may seek equitable relief in any court of competent jurisdiction
to prevent any violation of Section 11 of this Agreement. The Executive and the
Company each agree that equitable relief may be granted without the necessity to
post a bond. In the event that any provision of Section 12 of this Agreement is
deemed to be unreasonable by the final decision of a court of competent
jurisdiction, the Company and the Executive shall agree and submit to such
revision or modification thereof which said court shall deem to be reasonable
and which most closely conforms to the intent of this Agreement.
14. Mitigation. The Company's obligations to make payments provided for in
the Agreement and otherwise perform its obligations hereunder shall not be
affected by any set-off, counterclaim, recoupment, defense or other claim, right
or action which the Company may have against the Executive or others. The
Executive shall not be required to mitigate amounts payable hereunder by seeking
employment or otherwise.
15. Modification; Waiver or Discharge. This Agreement is entered into
between the Company and the Executive for the benefit of each of the Company and
the Executive. No provisions of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in writing
signed by the Executive and the Company. No waiver by either party hereto at any
time of any breach by the other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time.
16. Entire Agreement. This Agreement sets forth the entire agreement of the
parties hereto in respect of the subject matter contained herein and supersedes
all prior agreements, promises, covenants, arrangements, communications,
representations or warranties, whether oral or written, by any officer, employee
or representative of either party hereto (including the Employment Agreement,
except to the extent otherwise provided herein).
17. Assignment. This Agreement may not be assigned by the Executive, but
may be assigned by the Company to any successor to its business and will inure
to the benefit of and be binding upon any such successor. The Executive shall,
in his discretion, be entitled to proceed against such successor or the Company
in any action to enforce any rights of the Executive hereunder.
18. Counterparts. This Agreement may be executed in several counterparts,
each of which shall be deemed to be an original but all of which together will
constitute one and the same instrument.
19. Headings. The headings contained herein are for reference purposes only
and shall not in any way affect the meaning or interpretation of this Agreement.
20. Governing Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of
Connecticut without regard to principles of conflicts of laws.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
and year first above written.
FactSet Research Systems Inc.
BY: /s/ XXXXXXX X. XXXXXXXXXXX
BY: /s/ XXXXXX X. XXXXX
Xxxxxx X. Xxxxx
