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EXHIBIT 10.4
INFORMATION RESOURCES, INC.
DIRECTORS DEFERRED COMPENSATION PLAN
EFFECTIVE: MAY 1, 2000
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INFORMATION RESOURCES, INC.
DIRECTORS DEFERRED COMPENSATION PLAN
I. PURPOSE
The purpose of the Information Resources, Inc. Directors Deferred
Compensation Plan is to provide a means whereby the Company may afford
certain members of the Board of Directors an opportunity to defer
Director Fees otherwise payable in cash or stock. By providing a means
whereby Director Fees may be deferred into the future, the Plan will
further the growth and development of the Company and aid in attracting
and retaining directors of exceptional ability.
II. DEFINITIONS
2.01 "Administrative Committee" and "Committee" means the Plan Committee
appointed pursuant to Article VI to manage and administer the Plan.
2.02 "Agreement" means the Information Resources, Inc. Directors Deferred
Compensation Plan Participation Agreement, executed between a
Participant and the Company, whereby a Participant agrees to defer a
portion of his or her Director Fees pursuant to the provisions of the
Plan, and the Company agrees to make benefit payments in accordance
with the provisions of the Plan.
2.03 "Beneficiary" means the person, persons or trust who under the Plan,
becomes entitled to receive a Participant's interest in the event of
the Participant's death.
2.04 "Board of Directors" means the Board of Directors of Information
Resources, Inc. or any committee acting within the scope of its
authority.
2.05 "Company" means Information Resources, Inc. (also known as IRI), and
its successors and assigns.
2.06 "Deferred Compensation Account" means the book entry account(s)
maintained by the Company for each Participant, pursuant to Article
III. Notwithstanding the provisions of Section 8.10, a Participant's
Deferred Compensation Account shall not constitute or be treated as a
trust fund or escrow arrangement of any kind. For purposes of this
Plan, a book entry account shall mean a phantom account in which a
Participant's deferrals and investments earnings and gains and/or
losses and expenses are credited. No shares of Common Stock will
actually be held (either by issuance or purchase) with respect to any
investment in the Company stock-based deferral option.
2.07 "Deferred Compensation Plan Trust" and "Trust" mean the Information
Resources, Inc. Deferred Compensation Plan Trust, an irrevocable
grantor trust or trusts established by the Company, in accordance with
Section 8.10, with an independent trustee for the benefit of persons
entitled to receive payments under this Plan.
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2.08 "Determination Date" means the date on which the amount of a
Participant's Deferred Compensation Account is determined as provided
in Article III hereof. The last day of each calendar quarter and the
date of a Participant's Termination of Service shall be a Determination
Date.
2.09 "Director Fees" for purposes of this Plan shall be the total of the
director fees, including both cash and stock payments, and other
remuneration for services rendered as a member of the Board of
Directors during a Plan Year, including Retainer Fees and Meeting Fees.
Director Fees shall not include any amounts paid that are not strictly
for personal services, such as expense reimbursements. In addition, for
purposes of this Plan, Director Fees shall not include any stock
options received by a director.
2.10 "Fair Market Value" means either (a) the closing price of a share of
the Company's Common Stock as reported on the NASDAQ Exchange (the
"NASDAQ") on the date as of which such value is being determined, or,
if there are no reported transactions for such date, on the next
preceding date for which transactions were reported, as published in
the Midwest Edition of The Wall Street Journal, or (b) if there is no
reporting of transactions on the NASDAQ, the fair market value of a
share of the Company's Common Stock as determined by the Board of
Directors from time to time.
2.11 "Meeting Fees" means the compensation payable to a director with regard
to the number of Board or committee meetings attended, or committee
positions held, as determined by the Board from time to time.
2.12 "Participant" means a member of the Board of Directors of the Company
who is not an employee, who is eligible to participate in the Plan
pursuant to Section 3.01, and who enters into an Agreement.
2.13 "Plan" means the Information Resources, Inc. Directors Deferred
Compensation Plan as amended from time-to-time.
2.14 "Plan Effective Date" means May 1, 2000.
2.15 "Plan Year" means a twelve (12) month period beginning on May 1 and
ending on April 30.
2.16 "Retainer Fees" means the portion of a director's annual compensation
that is payable without regard to the number of Board or committee
meetings attended or committee positions, as determined by the Board
from time to time.
2.17 "Retirement" means the date of a Termination of Service of a
Participant for reasons other than death after he or she has completed
at least one full term of three (3) years serving on the Board of
Directors of the Company.
2.18 "Termination of Service" means the Participant's ceasing his or her
service with the Company for any reason whatsoever, whether voluntarily
or involuntarily, including by reason of Retirement or death.
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III. ELIGIBILITY; PARTICIPATION LIMITS
3.01 a) Eligibility to Participate. Participation in the Plan shall be
limited to non-employee directors of the Company approved to
participate by the Committee.
b) Election to Participate. An eligible director may elect to become
a Participant by filing a properly completed Agreement with the
Committee by such time and in such form as the Committee may
require or permit. A Participant's election to defer pursuant to
Section 3.02, shall remain in full force and effect for all
subsequent Plan Years until such time as the Participant files a
new Agreement with the Committee indicating a change in his prior
Agreement. In order to be effective for the next calendar year, a
Participant's Agreement must be received by December 1st of the
preceding year.
c) New Participants. A Participant who first attains such status
subsequent to May 1, 2000 shall be eligible to participate in the
Plan after satisfying the requirements of Section 3.01(a) and (b),
as applicable, and shall be bound by all terms and conditions of
the Plan, provided, however, that his or her Agreement is filed no
later than thirty (30) days following notification by the
Committee of his or her eligibility to participate in the Plan.
3.02 Deferral of Director Fees. A Participant may, in his or her Agreement
filed with the Committee, elect to defer up to one hundred percent
(100%) of his or her cash-based Director Fees in twenty-five (25%)
increments during a Plan Year. In addition, a Participant may elect to
defer up to one hundred percent (100%) of his or her stock-based
compensation payable during a Plan Year, in twenty-five percent (25%)
increments. At the time of election, a Participant may elect to defer a
different percentage of his or her cash-based Director Fees and/or
stock-based Director Fees for each Plan Year and may also elect not to
defer any portion of his or her cash-based and/or stock-based Director
Fees in a Plan Year.
Except as provided in Section 4.05, "Hardship Distributions; Waiver of
Deferrals," any election so made shall be irrevocable with respect to
Director Fees applicable to the Plan Year. A Participant who does not
file an Agreement for a Plan Year may file an Agreement for any
subsequent Plan Year for which he or she is eligible to participate in
the Plan.
3.03 Timing of Deferral Credits. The amount of Director Fees that a
Participant elects to defer in his or her Agreement shall cause an
equivalent reduction in the Participant's Director Fees, respectively.
Deferrals shall be credited to the Participant's Deferred Compensation
Account throughout the Plan Year as the Participant otherwise would
have been paid the deferred portion of Director Fees.
3.04 Vesting. A Participant shall be one hundred percent (100%) vested in
his or her Deferred Compensation Account equal to the amount of
Director Fees the Participant deferred into his or her Deferred
Compensation Account and the investment gains or losses credited
thereon.
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3.05 Determination of Account. Each Participant's Deferred Compensation
Account as of each Determination Date shall consist of the balance of
the Participant's Deferred Compensation Account as of the immediately
preceding Determination Date adjusted for:
- additional deferrals pursuant to Section 3.02,
- distributions (if any); and
- the appropriate investment earnings and gains and/or losses
and expenses pursuant to Section 3.06 and 3.07.
All adjustments and earnings related thereto, will be determined on a
quarterly basis.
The stock-based deferrals of a Participant's Deferred Compensation
Account will be determined based on the performance of the Company's
Common Stock. A Participant's deferral of stock-based Director Fees and
related investment earnings must remain allocated to the phantom stock
account.
3.06 Deferred Compensation Account Cash-Based Deferral Investment Options.
The Committee shall designate from time to time one or more investment
options in which the cash-based deferrals of a Participant's Deferred
Compensation Accounts may be deemed invested. A Participant or
Beneficiary shall allocate his or her Deferred Compensation Account
among the deemed investment options by filing with the Committee a
Deferral Allocation Election Form. A Participant may elect to allocate
his or her Deferred Compensation Account in ten percent (10%)
increments among as many of the investment options which are offered by
the Company. For the Plan Year beginning May 1, 2000, and until changed
by the Committee, the Committee has designated the following phantom
investment options:
a) Short-Term Bond Fund
b) Equity Index Fund
c) Large Cap Growth Fund
d) Enhanced U.S. Equity Fund
e) Mid-Cap Value Fund
Any such investment allocation election shall be made on the Deferral
Allocation Election Form and shall be subject to such rules as the
Committee may prescribe, including, without limitation, rules
concerning the manner of making investment allocation elections and the
frequency and timing of changing such investment allocation elections.
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The Committee shall have the sole discretion to determine the number of
investment options to be designated hereunder and the nature of the
investment options and may change or eliminate the investment options
provided hereunder from time to time. For each investment option the
Committee shall, in its sole discretion, select a mutual fund(s), an
investment index, or shall create a phantom portfolio of such
investments as it deems appropriate, to constitute the investment
option. The Company may, but is under no obligation to, acquire any
investment or otherwise set aside assets for the deemed investment of
Deferred Compensation Accounts hereunder. The Committee shall determine
the amount and rate of investment gains or losses with respect to any
such investment option for any period, and may take into account any
deemed expenses which would be incurred if actual investments were
made.
3.07 Deferred Compensation Account Stock-Based Deferral Option. Amounts
deemed invested in the Company stock-based deferral option shall
initially be deemed invested in a number of phantom shares of Common
Stock of the Company equal to the number of shares which would have
otherwise been actually distributed to the Participant, on the date the
amount is deemed so invested. When a dividend (other than a dividend
payable in the form of shares) is declared with respect to the
outstanding shares, the number of stock units credited to the
Participant shall be increased by the number of stock units, determined
by dividing (I) the product of (A) the number of stock units credited
to the Participant's account under the Plan on the related dividend
record date and (B) the amount of any cash dividend declared by the
Company on a share (or, in the case of any dividend distributable in
property other than shares, the per share value of such dividend, as
determined by the Company for purposes of income tax reporting) by (ii)
the Fair Market Value on the related dividend payment date. In the case
of any dividend declared on shares which is payable in shares, the
amount credited to a Participant's deemed investment in the Company
stock-based deferral option shall be increased by the number of stock
units equal to the product of (I) the number of Common Stock units
credited to the Participant under the Plan on the related dividend
record date and (ii) the number of shares distributable as a dividend
on a share. In the event of any change in the number or kind of
outstanding shares by reason of any recapitalization, reorganization,
merger, consolidation, stock split or any similar change affecting the
shares, other than a stock dividend as provided above, the Committee
shall make an appropriate adjustment in the number of Common Stock
units credited to the Participant. No shares of Common Stock will
actually be held (either by issuance or purchase) with respect to any
investment in the Company stock-based deferral option.
3.08 Change of Investment Election. A Participant may by a written notice
delivered to the Committee no later than twenty (20) days before the
first day of the next quarter, elect to change the manner in which his
or her current cash-based Deferred Compensation Account and his or her
future cash-based deferrals are deemed invested among the
then-available investment options. Any change of investment allocations
shall be effective on the first day of the quarter following the timely
receipt of such notice.
Once deferrals are made or investment earnings are credited into the
Company stock-based deferral option, such deferrals may not be
transferred out of this investment option.
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IV. DISTRIBUTIONS
4.01 Distribution on Retirement. Upon a Participant's Termination of Service
on or after a Retirement Date, distribution of the Participant's
Deferred Compensation Account, determined under Section 3.05, as of the
Determination Date coincident with or next following such Retirement
Date, shall be made or commence as soon as practicable but in any event
within ninety (90) days following the Participant's Termination of
Service on or after his or her Retirement Date. The distribution shall
be made as designated by the Participant in his or her Retirement
Payout Election Form, subject to Section 4.04. In the event a lump-sum
payment is elected, no investment earnings or losses shall be credited
to a Participant's Deferred Compensation Account from the date of
Termination of Service to the date of distribution. In the event a
distribution is made pursuant to this Section 4.01, the Participant
shall immediately cease to be eligible for any other benefit provided
under this Plan.
4.02 Distribution on Death. Upon the death of a Participant prior to the
distribution of all of his or her Deferred Compensation Account,
distribution of the Participant's Deferred Compensation Account, as of
the Determination Date coincident with or next following the date of
death, shall be made or continue to be made to such Participant's
Beneficiary. If the distribution of the Participant's Deferred
Compensation Account has not yet commenced as of the date of death,
distribution to the Beneficiary shall be made or commence as soon as
practicable and in any event within ninety (90) days following the
Participant's death. The method of distribution shall be as designated
by the Participant in his or her Retirement Payout Election Form,
subject to Section 4.04. In the event a lump-sum payment is elected, no
investment earnings or losses shall be credited to a Participant's
Deferred Compensation Account from the date of Termination of Service
to the date of distribution.
4.03 Distribution on Termination of Service. Unless otherwise directed by
the Committee, upon the Termination of Service of a Participant prior
to his or her Retirement Date for reasons other than death,
distribution of the Participant's Deferred Compensation Account shall
be made as soon as practicable and in any event within ninety (90) days
following such Termination of Service, in a single lump-sum,
notwithstanding the provisions of Section 4.04. No investment earnings
or losses shall be credited to a Participant's Deferred Compensation
Account from the date of Termination of Service to the date of
distribution.
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4.04 Method of Timing of Distribution.
a) Election in Agreement. Except in the case of a Termination of
Service prior to the Participant's Retirement Date for reasons
other than death, distribution of a Participant's cash-based
Deferred Compensation Account shall be made in a lump-sum or
installments, as elected by the Participant in his or her
Retirement Payout Election Form. Installment payments shall be
made quarterly over a period of up to twenty (20) years as elected
by the Participant. The amount of each quarterly installment shall
be determined annually and shall be equal to the quotient obtained
by dividing the balance of the Participant's cash-based Deferred
Compensation Account being distributed in installments by the
number of installments remaining to be paid, including the current
installment.
Distribution of a Participant's stock-based Deferred Compensation
Account shall be made in a lump-sum of shares of the Company's
Common Stock or installments as elected by the Participant in his
or her Retirement Payout Election form. Lump-sum distributions of
the Company's Common Stock shall be equal to the value of a
Participant's stock-based Deferred Compensation Account as of the
applicable Determination Date. Installment payments of a
Participant's stock-based Deferred Compensation Account will be
paid to a Participant in an approximate equal number of shares
over each quarter.
b) Election to Change Method of Distribution. A Participant may, by
written request filed with the Committee at least thirteen (13)
months prior to the distribution or commencement of distribution
of a Deferred Compensation Account, change the method of
distribution elected with respect to a Deferred Compensation
Account to any other method permitted under Section 4.04(a),
provided that such request shall not be effective unless and until
approved by the Committee. After a Participant's death, the
Participant's Beneficiary may, prior to the distribution or
commencement of distribution of the Participant's Deferred
Compensation Account, petition the Committee requesting an
acceleration of benefit payments otherwise due to be paid to the
Beneficiary. The Committee may, but is not required, to grant such
request.
c) Notwithstanding any payment method elected by a Participant or
Beneficiary, the Company may, in its sole discretion, elect to pay
in a lump-sum any Deferred Compensation Account whose balance is
less than $10,000.
4.05 Hardship Distributions; Waiver of Deferrals. In the event that the
Committee, upon written petition of the Participant or Beneficiary,
determines in its sole discretion that the Participant or Beneficiary
has suffered an unforeseeable financial emergency, the Company if so
directed by the Committee, shall distribute to the Participant or
Beneficiary as soon as reasonably practicable following such
determination, an amount, not in excess of the value of the
Participant's Deferred Compensation Account, necessary to satisfy the
emergency. For purposes of this Plan, an unforeseeable financial
emergency is an unanticipated emergency that is caused by an event
beyond the reasonable control of
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the Participant or Beneficiary, such as the financial hardship which
may result from accident, sudden illness or death of an immediate
family member, or casualty loss. Financial need arising from
foreseeable events, such as the purchase of a residence or educational
expenses, shall not be considered an emergency. The Committee shall
also grant a waiver of the Participant's Agreement to defer Director
Fees upon finding that the Participant has suffered an unforeseeable
financial emergency. The waiver shall be for such period of time as the
Committee deems necessary under the circumstances. A Participant who is
required to cease making deferrals due to the receipt of a hardship
distribution, shall be permitted to begin making deferrals into this
Plan by filing a new Agreement with the Company which such new
Agreement shall become effective with respect to the designated Plan
Year upon acceptance of the new Agreement by the Company. The new
Agreement must be filed with the Company at least thirty (30) days
prior to the calendar quarter in which deferrals are to commence. In
the event the Committee determines a hardship distribution is
appropriate, no investment earnings or losses will be credited to the
Participant's Deferred Compensation Account with regards to the amount
of the hardship distribution from the date the Committee approves the
hardship distribution to the actual distribution date.
4.06 Withholding; Employment Taxes. To the extent required by the law in
effect at the time payments are made, the Company shall withhold any
taxes required to be withheld by the federal, or any state or local,
government.
4.07 Commencement of Payments. Unless otherwise provided in this Plan,
payments under this Plan shall commence as soon as practicable
following the Participant's eligibility for payment, but in no event
later than ninety (90) days following receipt of notice by the
Committee of an event which entitles a Participant or Beneficiary to
payments under this Plan, or at such other reasonably subsequent date
as may be determined by the Committee.
4.08 Lump-sum Settlement/Call Right Option. Notwithstanding any other
provision of this Plan, any Participant or Beneficiary may, at any time
elect to receive an immediate lump-sum payment of the balance of his or
her Deferred Compensation Account, reduced by a penalty equal to eight
percent (8%) of the value of the Participant's remaining Deferred
Compensation Account. The eight percent (8%) penalty amount shall be
permanently forfeited and shall not be paid to, or in respect of, the
Participant or his or her Beneficiary. In the event no such request is
made by a Participant or Beneficiary, the Participant's Deferred
Compensation Account shall be paid in accordance with the provisions of
this Article IV. Any Participant who elects to receive an immediate
lump-sum payment pursuant to this Section 4.08, shall forego further
participation in the Plan for the remainder of the Plan Year in which
the payment is received, in addition to the subsequent Plan Year. In
the event a lump-sum payment is elected pursuant to this Section 4.08,
no investment earnings or losses shall be credited to the Participant's
Deferred Compensation Account from the date the Participant elects to
receive the lump-sum payment until the actual distribution date.
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4.09 Recipients of Payments: Designation of Beneficiary. All payments to be
made by the Company under the Plan shall be made to the Participant
during his or her lifetime, provided that if the Participant dies prior
to the commencement or completion of such payments, then all subsequent
payments under the Plan shall be made by the Company to the Beneficiary
determined in accordance with this Section 4.09. The Participant may
designate a Beneficiary by filing a written notice of such designation
with the Committee in such form as the Committee requires and may
include a contingent Beneficiary. The Participant may from time-to-time
change the designated Beneficiary by filing a new designation in
writing with the Committee. If no designation is in effect at the time
any benefits payable under this Plan become due, the Beneficiary shall
be the spouse of the Participant, or if no spouse is then living, the
executor(s) or administrator(s) of the Participant's estate.
4.10 Distributions. All distributions of a Participant's cash-based Deferred
Compensation Account shall be paid in United States dollars. All
distributions of a Participant's stock-based Deferred Compensation
Account shall be paid in shares of the Company's Common Stock.
V. CLAIM FOR BENEFITS PROCEDURE
5.01 Claim for Benefits. Any claim for benefits under the Plan shall be made
in writing to the Committee. If such claim for benefits is wholly or
partially denied by the Committee, the Committee shall, within a
reasonable period of time, but not later than sixty (60) days after
receipt of the claim, notify the claimant of the denial of the claim.
Such notice of denial shall be in writing and shall contain:
a) The specific reason or reasons for the denial of the claim;
b) A reference to the relevant Plan provisions upon which the denial
is based;
c) A description of any additional material or information necessary
for the claimant to perfect the claim, together with an
explanation of why such material or information is necessary; and
d) A reference to the Plan's claim review procedure.
5.02 Request for Review of a Denial of a Claim for Benefits. Upon the
receipt by the claimant of written notice of the denial of a claim, the
claimant may within ninety (90) days file a written request to the
Committee, requesting a review of the denial of the claim, which review
shall include a hearing if deemed necessary by the Committee. In
connection with the claimant's appeal of the denial of his or her
claim, he or she may review relevant documents and may submit issues
and comments in writing. To provide for fair review and a full record,
the claimant must submit in writing all facts, reasons and arguments in
support of his or her position within the time allowed for filing a
written request for review. All issues and matters not raised for
review will be deemed waived by the claimant.
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5.03 Decision Upon Review of a Denial of a Claim for Benefits. The Committee
shall render a decision on the claim review promptly, but no more than
sixty (60) days after the receipt of the claimant's request for review,
unless special circumstances (such as the need to hold a hearing)
require an extension of time, in which case the sixty (60) day period
shall be extended to one hundred-twenty (120) days. Such decision
shall:
a) Include specific reasons for the decision;
b) Be written in a manner calculated to be understood by the
claimant; and
c) Contain specific references to the relevant Plan provisions upon
which the decision is based.
The decision of the Committee shall be final and binding in all
respects on the Company, the claimant and any other person claiming an
interest in the Plan through or on behalf of the claimant. No
litigation may be commenced by or on behalf of a claimant with respect
to this Plan until after and unless the claim and review process
described in this Article V has been exhausted. Judicial review of
Committee action shall be limited to whether the Committee acted in an
arbitrary and capricious manner.
VI. ADMINISTRATION
6.01 Plan Administrative Committee. The Plan shall be administered by the
Administrative Committee. The Administrative Committee may assign
duties to an officer or other employees of the Company, and may
delegate such duties as it sees fit. An employee of the Company or the
Administrative Committee member who is also a Participant in the Plan
shall not be involved in the decisions of the Company or the
Administrative Committee regarding any determination of any specific
claim for benefit with respect to himself or herself.
6.02 General Rights, Powers and Duties of the Administrative Committee. The
Administrative Committee shall be responsible for the management,
operation and administration of the Plan. In addition to any powers,
rights and duties set forth elsewhere in the Plan, it shall have
complete discretion to exercise the following powers and duties:
a) To adopt such rules and regulations consistent with the provisions
of the Plan as it deems necessary for the proper and efficient
administration of the Plan;
b) To administer the Plan in accordance with its terms and any rules
and regulations it establishes;
c) To maintain records concerning the Plan sufficient to prepare
reports, returns, and other information required by the Plan or by
law;
d) To construe and interpret the Plan, and to resolve all questions
arising under the Plan;
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e) To direct the Company to pay benefits under the Plan, and to give
such other directions and instructions as may be necessary for the
proper administration of the Plan;
f) To employ or retain agents, attorneys, actuaries, accountants or
other persons, who may also be Participants in the Plan or be
employed by or represent the Company, as it deems necessary for
the effective exercise of its duties, and may delegate to such
persons any power and duties, both ministerial and discretionary,
as it may deem necessary and appropriate, and the Committee shall
be responsible for the prudent monitoring of their performance;
and
g) To be responsible for the preparation, filing, and disclosure on
behalf of the Plan of such documents and reports as are required
by any applicable federal or state law.
6.03 Information to be Furnished to Committee. The records of the Company
shall be determinative of each Participant's period of service with the
Company, Retirement Date, Termination of Service and the reason
therefore, personal data, numbers of completed board terms and Director
Fees and any deferrals. Participants and their Beneficiaries shall
furnish to the Committee such evidence, data or information, and
execute such documents as the Committee requests.
6.04 Indemnification. No director or member of the Committee shall be liable
to any person for any action taken or omitted in connection with the
administration of this Plan unless attributable to his or her own fraud
or willful misconduct. The Company shall not be liable to any person
for any such action unless attributable to fraud or willful misconduct
on the part of a director, officer or employee of the Company. This
indemnification shall not duplicate, but may supplement any coverage
available under any applicable insurance coverage.
VII. AMENDMENT AND TERMINATION
7.01 Amendment. The Plan may be amended in whole or in part at any time by a
written instrument adopted by the Company. Notice of any material
amendment shall be given in writing to the Committee and to each
Participant, and each Beneficiary. No amendment shall retroactively
decrease either the balance of a Participant's Deferred Compensation
Account or a Participant's interest in his or her Deferred Compensation
Account as existing immediately prior to the later of the effective
date or adoption date of such amendment.
7.02 Company's Right to Terminate. The Company reserves the sole right to
terminate, by action of its Administrative Committee, the Plan and/or
the Agreement pertaining to a Participant at any time prior to the
commencement of payment of his or her benefits. In the event of any
such termination, a Participant shall be deemed to have incurred a
Termination of Service, and his or her Deferred Compensation Account
shall be paid in the manner provided in Section 4.03.
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7.03 Special Termination. Any other provision of the Plan to the contrary
notwithstanding, the Plan shall terminate if:
The Plan is held to be ERISA Funded or Tax Funded, (as defined below),
by a federal court, and appeals from that holding are no longer timely
or have been exhausted. The Company may terminate the Plan if it
determines, based on a legal opinion which is satisfactory to the
Company, that either judicial authority or the opinion of the U.S.
Department of Labor, Treasury Department or Internal Revenue Service
(as expressed in proposed or final regulations, advisory opinions or
rulings, or similar announcements) creates a significant risk that the
Plan will be held to be ERISA Funded or Tax Funded, and failure to
amend the Plan could subject the Company or the Participants to
material penalties. Upon any such termination, the Company may:
a) Transfer the rights and obligations of the Company and some
or all Participants as determined by the Company in its sole
discretion to a new plan established by the Company, which
is not deemed to be ERISA Funded or Tax Funded, but which is
substantially similar in all other respect to this Plan, if
the Company determines that it is possible to establish such
a Plan; or
b) If the Company, in its sole discretion, determines that it
is not possible to establish the Plan in 7.03(a) above for
some or all Participants, such Participants shall be paid, a
lump-sum equal to the value of his or her Deferred
Compensation Account; or
c) Pay to a Participant a lump-sum benefit equal to the value
of his or her Deferred Compensation Account to the extent
that a federal court has held that the interest of the
Participant in the Plan is includable in the gross income of
the Participant for federal income tax purposes prior to
actual payment of Plan benefits; or
d) Pay to a Participant a lump-sum benefit equal to the value
of his or her Deferred Compensation Account if, based on a
legal opinion satisfactory to the Company, there is a
significant risk that such Participant will be determined
not to be part of a "select group of management or highly
compensated employees" for purposes of ERISA.
For purposes of this Plan, "ERISA Funded" means that the Plan is
prevented from meeting the "unfunded" criterion of the exceptions to
the application of Parts 2 through 4 of Subtitle B of Title I of the
Employee Retirement Income Security Act of 1974 (ERISA). In addition,
for purposes of this Plan, "Tax Funded" means that the interest of a
Participant in the Plan is determined to be includable in the gross
income of the Participant for federal income tax purposes prior to
actual receipt of Plan benefits by the Participant.
A lump-sum payment to be made in accordance with this Section shall be
subject to the provisions of Section 4.07.
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VIII. MISCELLANEOUS
8.01 Separation of Plan: No Implied Rights. Neither the establishment of the
Plan nor any amendment thereof shall be construed as giving any
Participant, Beneficiary, or any other person any legal or equitable
right unless such right shall be specifically provided for in the Plan
or conferred by specific action of the Committee or Company in
accordance with the terms and provisions of the Plan. Except as
expressly provided in this Plan, the Company shall not be required or
be liable to make any payment under this Plan.
8.02 No Right to Company Assets. Neither the Participant, a Beneficiary, nor
any other person shall acquire by reason of the Plan any right in or
title to any assets, funds or property of the Company whatsoever,
including, without limiting the generality of the foregoing, any
specific funds, assets or other property which the Company, in its sole
discretion, may set aside in anticipation of a liability hereunder. Any
benefits which become payable hereunder shall be paid from the general
assets of the Company. The Participant and his or her Beneficiary shall
have only a contractual right to the amounts, if any, payable
hereunder, unsecured by any asset of the Company. Nothing contained in
the Plan constitutes a guarantee by the Company that the assets of the
Company shall be sufficient to pay any benefits to any person.
8.03 No Employment Rights. Nothing herein shall constitute a contract of
employment or of continuing service or in any manner obligate the
Company to continue the services of the Participant, or obligate the
Participant to continue in the service of the Company, or as a
limitation of the right of the Company to discharge any of its
directors, with or without cause. Nothing herein shall be construed as
fixing or regulating the Director Fees payable to the Participant.
8.04 Offset. If, at the time payments or installments of payments are to be
made hereunder, either the Participant or Beneficiary is indebted or
obligated to the Company, then the payments remaining to be made to the
Participant or the Beneficiary may, at the discretion of the Company,
be reduced by the amount of such indebtedness or obligation. However,
an election by the Company not to reduce any such payment or payments
shall not constitute a waiver of its claim, or prohibit or otherwise
impair the Company's right to offset future payments for such
indebtedness or obligation.
8.05 Protective Provisions. In order to facilitate the payment of benefits
hereunder, each non-employee director designated eligible to
participate in the Plan, shall cooperate with the Company by furnishing
any and all information requested by the Company, including taking such
physical examinations as the Company may deem necessary, and taking
such other actions as may be requested by the Company. If the
non-employee director refuses to cooperate, he or she shall not become
a Participant in the Plan and the Company shall have no further
obligation to him or her under the Plan. In the event a Participant has
a balance in his or her Deferred Compensation Account, the Participant
or his or her Beneficiary shall receive a benefit equal to his or her
Deferred Compensation Account determined pursuant to Section 3.05 and
paid in accordance with Section 4.03.
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8.06 Non-assignability. Neither the Participant nor any other person shall
have any voluntary or involuntary right to commute, sell, assign,
pledge, anticipate, mortgage or otherwise encumber, transfer,
hypothecate, or convey in advance of actual receipt the amounts, if
any, payable hereunder, or any part thereof, which are expressly
declared to be unassignable and non-transferable. No part of the
amounts payable shall be, prior to actual payment, subject to seizure
or sequestration for the payment of any debts, judgments, alimony or
separate maintenance owed by the Participant or any other person, or be
transferable by operation of law in the event of the Participant's, or
any other person's bankruptcy or insolvency.
8.07 Gender and Number. Wherever appropriate herein, the masculine may mean
feminine and the singular may mean the plural, or vice versa.
8.08 Notice. Any notice required or permitted to be given under the Plan
shall be sufficient if in writing and hand delivered, or sent by
registered or certified mail, and if given to the Company, delivered to
the principal office of the Company, directed to the attention of the
Administrative Committee. Such notice shall be deemed given as of the
date of delivery, or, if delivery is made by mail, as of the date shown
on the postmark or the receipt for registration or certification.
8.09 Governing Laws. The Plan shall be construed and administered according
to the laws of the State of Illinois, to the extent not pre-empted by
federal law.
8.10 Deferred Compensation Plan Trust. The Company may establish a Trust
with (an) independent trustee(s), and shall comply with the terms of
the Trust. The Company may transfer to the trustee(s) an amount of
cash, marketable securities, or other property acceptable to the
trustee(s) ("Trust Property") equal in value to all or a portion of the
amount necessary, calculated in accordance with the terms of the Trust,
to pay the Company's obligations under the Plan (the "Funding Amount"),
and may make additional transfers to the trustees as may be necessary
in order to maintain the Funding Amount. Trust Property so transferred
shall be held, managed, and disbursed by the trustee(s) in accordance
with the terms of the Trust. To the extent that Trust Property shall be
used to pay the Company's obligations under the Plan, such payments
shall discharge obligations of the Company; however, the Company shall
continue to be liable for amounts not paid by the Trust. Trust Property
will nevertheless be subject to claims of the Company's creditors in
the event of bankruptcy or insolvency of the Company, and the
Participant's, a Beneficiary's, or any other person's rights under the
Plan and Trust shall at all times be subject to the provisions of
Section 8.02.
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IN WITNESS WHEREOF, the Company has adopted the Information Resources, Inc.
Directors Deferred Compensation Plan effective May 1, 2000.
Information Resources, Inc.
By: /s/ Gary S. Newman
-----------------------------------------
Its: Executive Vice President, Human Resources
-----------------------------------------
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