-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Da47rE/STDnFPGROpmrgVuL4CDXwYUFqf3utQehYlZKE165AUH6oSApoo/cMFwx+ U8xXTU9cBNMWfR04GFChlg== 0000912057-01-529654.txt : 20010822 0000912057-01-529654.hdr.sgml : 20010822 ACCESSION NUMBER: 0000912057-01-529654 CONFORMED SUBMISSION TYPE: SC 14D9 PUBLIC DOCUMENT COUNT: 12 FILED AS OF DATE: 20010821 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: NEWSEDGE CORP CENTRAL INDEX KEY: 0000858912 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROGRAMMING, DATA PROCESSING, ETC. [7370] IRS NUMBER: 043016142 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 14D9 SEC ACT: 1934 Act SEC FILE NUMBER: 005-44899 FILM NUMBER: 1719763 BUSINESS ADDRESS: STREET 1: 80 BLANCHARD RD CITY: BURLINGTON STATE: MA ZIP: 01803 BUSINESS PHONE: 7812293000 MAIL ADDRESS: STREET 1: DESKTOP DATA INC STREET 2: 80 BLANCHARD RD CITY: BURLINGTON STATE: MA ZIP: 01803 FORMER COMPANY: FORMER CONFORMED NAME: DESKTOP DATA INC DATE OF NAME CHANGE: 19950629 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: NEWSEDGE CORP CENTRAL INDEX KEY: 0000858912 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROGRAMMING, DATA PROCESSING, ETC. [7370] IRS NUMBER: 043016142 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 14D9 BUSINESS ADDRESS: STREET 1: 80 BLANCHARD RD CITY: BURLINGTON STATE: MA ZIP: 01803 BUSINESS PHONE: 7812293000 MAIL ADDRESS: STREET 1: DESKTOP DATA INC STREET 2: 80 BLANCHARD RD CITY: BURLINGTON STATE: MA ZIP: 01803 FORMER COMPANY: FORMER CONFORMED NAME: DESKTOP DATA INC DATE OF NAME CHANGE: 19950629 SC 14D9 1 a2057464zsc14d9.txt SC 14D9 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ SCHEDULE 14D-9 SOLICITATION/RECOMMENDATION STATEMENT UNDER SECTION 14(D)(4) OF THE SECURITIES EXCHANGE ACT OF 1934 --------------------- NEWSEDGE CORPORATION (Name of Subject Company) NEWSEDGE CORPORATION (Name of Persons Filing Statement) COMMON STOCK, $0.01 PAR VALUE (Title of Class of Securities) 652 49 Q106 (CUSIP Number of Class of Securities) ------------------------ CLIFFORD M. POLLAN CHIEF EXECUTIVE OFFICER AND PRESIDENT NEWSEDGE CORPORATION 80 BLANCHARD ROAD BURLINGTON, MASSACHUSETTS 01803 (781) 229-3000 (Name, address and telephone number of person authorized to receive notices and communications on behalf of the persons filing statement) WITH COPIES TO: LAWRENCE S. WITTENBERG, ESQ. LAWRENCE A. GOLD, ESQ. TESTA, HURWITZ & THIBEAULT, LLP 125 HIGH STREET BOSTON, MA 02110 (617) 248-7000 / / Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- ITEM 1. SUBJECT COMPANY INFORMATION The name of the subject company is NewsEdge Corporation, a Delaware corporation ("NewsEdge"). The address of the principal executive office of NewsEdge is 80 Blanchard Road, Burlington, Massachusetts 01803. NewsEdge's telephone number at its principal executive office is (781) 229-3000. The title of the class of equity securities to which this Solicitation/Recommendation Statement on Schedule 14D-9 (together with any Exhibits or Annexes hereto, this "Schedule 14D-9") relates is the common stock, $0.01 per share par value, of NewsEdge (the "Common Stock" or the "Shares"). As of August 6, 2001, there were 18,621,403 shares of Common Stock outstanding. As of August 6, 2001 an additional 3,841,026 Shares have been reserved for future issuance pursuant to outstanding employee stock options, 801,497 Shares have been reserved for future issuance pursuant to outstanding warrants and rights to acquire 19,579 Shares were outstanding in connection with rights to purchase Shares granted pursuant to NewsEdge's 1995 Employee Stock Purchase Plan. On a fully-diluted basis, there were 23,283,505 Shares outstanding as of August 6, 2001. ITEM 2. IDENTITY AND BACKGROUND OF FILING PERSON The filing person is the subject company. NewsEdge's name, business address and business telephone number are in Item 1 above. This Schedule 14D-9 relates to the tender offer by InfoBlade Acquisition Corporation ("Merger Sub"), a Delaware corporation and an indirect wholly owned subsidiary of The Thomson Corporation, a corporation incorporated under the laws of the province of Ontario ("Thomson"), to purchase all of the outstanding Shares held by NewsEdge's stockholders at $2.30 per Share (the "Offer Price"), net to the seller in cash, without interest, upon the terms and subject to the conditions set forth in Merger Sub's Offer to Purchase, dated August 21, 2001 and in the related Letter of Transmittal (which, as amended or supplemented, collectively constitute the "Offer"). The Offer is described in a Tender Offer Statement on Schedule TO (as amended or supplemented from time to time, the "Schedule TO"), filed by Merger Sub and Thomson with the Securities and Exchange Commission on August 21, 2001. The Offer is being made in accordance with the Agreement and Plan of Merger, dated as of August 6, 2001 among Thomson, Merger Sub and NewsEdge (the "Merger Agreement"). The Merger Agreement provides that, subject to the satisfaction or waiver of certain conditions, following completion of the Offer, and in accordance with the Delaware General Corporation Law (the "DGCL"), Merger Sub will be merged with and into NewsEdge (the "Merger"). On completion of the Merger, NewsEdge will continue as the surviving corporation and become an indirect wholly owned subsidiary of Thomson. At the effective time of the Merger (the "Effective Time"), each issued and outstanding Share (other than Shares held in the treasury of NewsEdge and Shares held by stockholders who perfect appraisal rights under the DGCL) will be cancelled and automatically converted into the right to receive the same amount in cash per Share, without interest, that is paid pursuant to the Offer. The Schedule TO states that the principal executive offices of Thomson are located at Suite 2706, Toronto Dominion Bank Tower, 66 Wellington Street West, Toronto Dominion Centre, Toronto, Ontario M5K 1A1, Canada and the principal executive offices of Merger Sub are located at Metro Center, One Station Place, Stamford, Connecticut 06902. All information in this Schedule 14D-9 or incorporated in this Schedule 14D-9 by reference concerning Merger Sub or Thomson, or actions or events with respect to either of them, was provided by Merger Sub or Thomson, respectively. Information contained in this Schedule 14D-9 with respect to NewsEdge and its advisors has been provided by NewsEdge. 2 Certain information provided by NewsEdge and relating to the Offer, the full text of which has previously been filed with the Securities and Exchange Commission as preliminary communications made before the commencement of the Offer, is available on the internet at WWW.NEWSEDGE.COM. ITEM 3. PAST CONTACTS, TRANSACTIONS, NEGOTIATIONS AND AGREEMENTS Certain contracts, agreements, arrangements or understandings between NewsEdge or its affiliates and certain of its directors and executive officers are described in the Information Statement that is attached as Annex A to this Schedule 14D-9 and is incorporated in this Schedule 14D-9 by reference. The Information Statement is being furnished to NewsEdge's stockholders pursuant to Section 14(f) of the Securities Exchange Act of 1934, as amended (the "Exchange Act") and Rule 14f-1 under the Exchange Act in connection with Merger Sub's right (promptly upon the purchase by Merger Sub of Shares pursuant to the Offer) to designate persons to be appointed to NewsEdge's Board of Directors (the "Board") other than at a meeting of the stockholders of NewsEdge. In considering the recommendations of the Board, NewsEdge's stockholders should be aware that certain members of the Board and certain of NewsEdge's executive officers have interests in the Merger and the Offer that are described in this Schedule 14D-9 and in the Information Statement and incorporated by reference in this Schedule 14D-9. These interests may present them with conflicts of interest. For example, upon the earlier to occur of the date Merger Sub pays for the Shares pursuant to the Offer or the Effective Time, NewsEdge is obligated to pay a cash bonus to each executive officer of NewsEdge. Other such contracts, agreements, arrangements and understandings known to NewsEdge are described below or are summarized in the Offer to Purchase, which is incorporated herein by reference. Except as described in this Schedule 14D-9 or incorporated in this Schedule 14D-9 by reference, to the knowledge of NewsEdge, as of the date of this Schedule 14D-9, there exists no material agreement, arrangement or understanding or any actual or potential conflict of interest between NewsEdge or its affiliates and (a) NewsEdge's executive officers, directors or affiliates; or (b) Thomson and Merger Sub or Thomson and Merger Sub's executive officers, directors or affiliates. THE CONFIDENTIALITY AGREEMENT The summary of the Confidentiality Agreement, dated as of May 16, 2001 by and between Broadview International LLC, on behalf of NewsEdge, and West Group, an affiliate of Thomson, (the "Confidentiality Agreement") in Section 10 of the Offer to Purchase is incorporated in this Schedule 14D-9 by reference. The summary and description of the Confidentiality Agreement is qualified in its entirety by reference to the Confidentiality Agreement, which has been filed as Exhibit (e)(3) to this Schedule 14D-9 and is incorporated in this Schedule 14D-9 by reference. THE MERGER AGREEMENT The summary of the Merger Agreement and the statement of the conditions to the Offer in Sections 10 and 14, respectively of the Offer to Purchase are incorporated in this Schedule 14D-9 by reference. The summary and description of the Merger Agreement is qualified in its entirety by reference to the Merger Agreement, which has been filed as Exhibit (e)(1) to this Schedule 14D-9 and is incorporated in this Schedule 14D-9 by reference. THE STOCKHOLDERS AGREEMENT The summary of the Stockholders Agreement (to which all of the directors, certain executive officers and a principal stockholder of NewsEdge are a party) in Section 10 of the Offer to Purchase is incorporated in this Schedule 14D-9 by reference. The summary and description of the Stockholders Agreement is qualified in its entirety by reference to the Stockholders Agreement, which has been filed as Exhibit (e)(2) to this Schedule 14D-9 and is incorporated in this Schedule 14D-9 by reference. 3 EMPLOYMENT ARRANGEMENTS WITH NEWSEDGE. In connection with the Merger Agreement, each of Clifford M. Pollan, Ronald Benanto, Charles White, Thomas Karanian, John Crozier, David M. Scott, Alton Zink and Lee Phillips (each, an "Officer" and collectively the "Officers") entered into amended and restated executive employment agreements with NewsEdge (each, an "Amended Employment Agreement" and collectively, the "Amended Employment Agreements"). Employment under the Amended Employment Agreements commences on the earlier to occur of (x) the date that Merger Sub pays for the Shares pursuant to the Offer and (y) the Effective Time, and continues for one year thereafter. Upon expiration of this one year employment term, the employment of each Officer will be on an "at-will" basis. As of August 6, 2001, the Amended Employment Agreements replaced the employment agreements then in effect between NewsEdge and each of the Officers (the "Original Employment Agreements") provided that if the Merger Agreement is terminated prior to the Effective Time, the Amended Employment Agreement will automatically terminate and the Original Employment Agreement of each Officer will be automatically reinstated. The Original Employment Agreements and the Amended Employment Agreements are described in detail in the Information Statement attached as Annex A to this Schedule 14D-9. The Amended Employment Agreements provide for annual base salaries of $275,000 for Mr. Pollan, $210,000 for Mr. Benanto, $185,000 for each of Messrs. White and Karanian, $180,000 for Mr. Crozier, $160,000 for Mr. Scott and $150,000 for each of Messrs. Zink and Phillips, each amount being equal to the salary payable to the Officers under their Original Employment Agreements. Each Officer is also eligible to participate in NewsEdge's standard benefit plans, accrue paid vacation time and receive an annual cash bonus based upon performance targets established by NewsEdge and Thomson. If an Officer is an active employee of NewsEdge on the one-year anniversary of the date the Officer's employment commenced under the Amended Employment Agreement, the Officer will be paid, in the case of all Officers other than Mr. Pollan, a bonus equal to his annual base salary and in the case of Mr. Pollan, a bonus equal to $365,000. Under the terms of the Amended Employment Agreements, NewsEdge may terminate any of the Officers with or without cause. If terminated without cause or if an Officer terminates employment with NewsEdge upon the occurrence of certain events described as "good reason" in the Amended Employment Agreements during the one year employment term, the terminated Officer will be entitled to, in the case of all officers other than Mr. Pollan, a continuation in the payment of his base salary for a twelve month period immediately following the date of such termination and a continuation of the benefits which he was receiving at the time of termination, (or if NewsEdge is unable to so provide, the cash value thereof) for an equivalent period and in the case of Mr. Pollan, a continuation in the payment of his base salary for a twelve month period immediately following the date of such termination plus an amount equal to the maximum amount of Mr. Pollan's target bonus and a continuation of the benefits which he was receiving at the time of termination, (or if NewsEdge is unable to so provide, the cash value thereof) for an equivalent period. NewsEdge will only be obligated to make these severance payments to a terminated Officer if the Officer executes a general release of claims in favor of NewsEdge. As a party to the Amended Employment Agreement, each Officer has also agreed to certain non-solicitation, non-competition, confidentiality and non-disclosure provisions. The summary of the Amended Employment Agreements in Section 10 of the Offer to Purchase is incorporated in this Schedule 14D-9 by reference. The summary and description of the Amended Employment Agreements is qualified in its entirety by reference to the Amended Employment Agreements, each of which has been filed as Exhibits (e)(4)-(e)(11) to this Schedule 14D-9 and each of which is incorporated in this Schedule 14D-9 by reference. 4 EFFECTS OF THE OFFER AND THE MERGER UNDER NEWSEDGE STOCK OPTION AND PURCHASE PLANS AND AGREEMENTS BETWEEN NEWSEDGE AND ITS EXECUTIVE OFFICERS The executive officers of NewsEdge, including the Chief Executive Officer who is a member of the Board, have interests in the transactions contemplated by the Merger Agreement that are in addition to their interests as NewsEdge stockholders generally. The Board was aware of these interests and considered them, among other matters, in approving the Merger Agreement and the transactions contemplated by the Merger Agreement. TREATMENT OF STOCK OPTIONS. As of the Effective Time, NewsEdge shall terminate NewsEdge's Amended and Restated 1989 Stock Option Plan, 1995 Stock Plan, 1995 Non-Employee Director Stock Option Plan, 2000 Non-Officer and Non-Director Stock Plan and Individual, Inc.'s 1996 Non-Employee Director Stock Option Plan, each as amended through August 6, 2001, and cancel, at the Effective Time, each outstanding option to purchase Shares granted under these plans that is outstanding as of such date. Each holder of an outstanding option at the Effective Time will be entitled, to the extent any such option is exercisable, to receive from NewsEdge, as the surviving corporation of the Merger, immediately after the Effective Time, in exchange for the cancellation of such option, an amount in cash equal to the excess, if any, of (x) the Offer Price over (y) the per share exercise price of the option, multiplied by the number of Shares subject to the option as of the Effective Time. Any such payment shall be subject to all applicable federal, state and local tax withholding requirements. On August 6, 2001 the Board adopted resolutions pursuant to which, immediately prior to the Effective Time, 50% of all outstanding and unvested options (including those held by directors and executive officers of NewsEdge) granted under any of NewsEdge's stock option plans will become fully vested and exercisable. As of the last day of the payroll period immediately preceding the Effective Time (the "ESPP Date"), all offering and purchase periods under way under NewsEdge's 1995 Employee Stock Purchase Plan, shall be terminated and, as of August 6, 2001, no new offering or purchase periods shall be commenced. At the ESPP Date, NewsEdge will terminate its 1995 Employee Stock Purchase Plan and each participant's rights thereunder will terminate in exchange for a cash payment equal to the excess of (i) the Offer Price multiplied by the number of Shares that the participant's accumulated payroll deductions could purchase at the ESPP Date at the $2.07 option price under the 1995 Employee Stock Purchase Plan as of March 1, 2001, over (ii) the result of multiplying the number of Shares in clause (i) by $2.07, subject to any applicable federal, state and local tax withholding requirements. EFFECTS OF THE OFFER AND THE MERGER WITH RESPECT TO NEWSEDGE'S BOARD OF DIRECTORS DIRECTOR AND OFFICER INDEMNIFICATION; INSURANCE. To the extent provided in NewsEdge's By-laws in effect on August 6, 2001, after the Effective Time, NewsEdge, as the surviving corporation of the Merger, shall continue to indemnify NewsEdge's current and former directors and officers. Any such indemnification obligation will extend for three years after the Effective Time and will be subject to limitations imposed under applicable law. In addition, NewsEdge, as the surviving corporation of the Merger, will use its reasonable best efforts to maintain NewsEdge's current directors' and officers' insurance and indemnification policy to the extent that it provides coverage for events occurring before the Effective Time for all persons who were directors and officers of NewsEdge on the date of the Merger Agreement. NewsEdge's directors' and officers' insurance policy may be replaced provided that any substitute policy contains at least the same coverage containing terms and conditions that are not materially less favorable with respect to matters occurring prior to the Effective Time than NewsEdge's existing policy. 5 ITEM 4. THE SOLICITATION OR RECOMMENDATION (A) RECOMMENDATION OF THE BOARD At a meeting held on August 6, 2001, the Board reviewed the status of the merger discussions with Thomson and the status of competing offers. At that meeting, Broadview International LLC ("Broadview") delivered its oral opinion to the Board that, as of the date of such opinion and based upon and subject to certain matters stated in such opinion, the Offer Price was fair to NewsEdge's stockholders from a financial point of view. Broadview's oral opinion was confirmed in a written opinion letter dated August 6, 2001 (the "Fairness Opinion"), a copy of which is attached as Annex B to this Schedule 14D-9 and is incorporated into this Schedule 14D-9 by reference. At the conclusion of the meeting, the Board unanimously (a) determined that the Merger Agreement and the transactions contemplated thereby, including the Offer and Merger, and the Amended Employment Agreements (collectively, the "Transactions"), are fair to, and in the best interests of, the stockholders of NewsEdge, (b) approved, and declared advisable the Merger Agreement and the Transactions, (c) approved the execution, delivery and performance of the Merger Agreement, the Amended Employment Agreements and the completion of the Transactions contemplated thereby, including the Offer and the Merger, and (d) resolved to recommend that holders of Shares accept the Offer and tender their Shares pursuant to the Offer and approve and adopt the Merger Agreement. THE BOARD UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR SHARES IN THE OFFER. (B)(I) BACKGROUND OF THE OFFER During the March 29, 2001 meeting of the Board, the directors and certain members of senior management analyzed a number of industry trends and conditions, as well as issues specific to NewsEdge. Following this discussion and after weighing NewsEdge's strategic alternatives, the Board discussed the advisability of hiring an investment banking firm to assist in assessing NewsEdge's strategic options. Clifford M. Pollan, Chief Executive Officer, President and a member of the Board, and Ronald Benanto, Vice President--Finance, Chief Financial Officer and Treasurer, reported on conversations with certain investment bankers that they had conducted to date. The directors discussed the advisability of establishing a committee to interview and engage an investment banking firm. The Board unanimously resolved to appoint Mr. Cowan, Mr. Devereaux and Mr. Kolowich, all members of the Board, to a committee to assist management in identifying, interviewing, and engaging an investment banking firm to assist NewsEdge in evaluating strategic alternatives, and to monitor and supervise this process (the "Special Committee"). On April 3, 2001 the Special Committee conducted interviews with two potential investment banking firms each of which made extensive presentations to the Special Committee. At the conclusion of the meeting the Special Committee advised Mr. Pollan to proceed with an engagement of Broadview. On April 6, 2001 NewsEdge engaged Broadview to act as its financial advisor in connection with NewsEdge's intent to consider acquisition offers and, if requested by NewsEdge, to render the Board an opinion with respect to the fairness to the holders of Shares, from a financial point of view, of the consideration to be received in any acquisition of NewsEdge. Thereafter, Broadview produced an Offering Memorandum for NewsEdge to be distributed to potential acquirers. On April 20, 2001 Broadview and NewsEdge held an initial meeting with a potential acquirer ("Party A") regarding a possible acquisition of NewsEdge. Discussion centered around the strategic fit that NewsEdge offered the potential acquirer and the synergies to be realized upon combining the companies. The parties resolved to further consider a possible acquisition and to meet again in the near future. 6 During the April 26, 2001 meeting of the Board, Mr. Pollan reported that the Special Committee had authorized NewsEdge management to retain Broadview as NewsEdge's financial advisor and that thereafter NewsEdge entered into an engagement agreement with Broadview. At the meeting, Steve O'Leary and Rodd Langenhagen, both representatives of Broadview, outlined their plan for investigating several strategic alternatives for NewsEdge and the directors discussed each of these alternatives in turn. Mr. O'Leary and Mr. Langenhagen discussed the status of discussions to date, including those with Party A, and sought input from the Board regarding potential acquirers and necessary follow up. On May 11, 2001 Broadview submitted a status report to the Board detailing their discussions to date with potential acquirers. Broadview reported that it had presented overviews of NewsEdge's business to nine potential acquirers, including three separate entities affiliated with Thomson. On May 16, 2001 NewsEdge entered into a Confidentiality Agreement with the West Group, an affiliate of Thomson, relating to the exchange of information between the two parties in light of a potential acquisition of NewsEdge by West Group or another affiliate of Thomson. Thereafter due diligence materials regarding NewsEdge were provided to Thomson. On May 25, 2001 Broadview submitted a second status report to the Board detailing their continuing discussions with potential acquirers. During the May 25, 2001 meeting of the Board, Mr. Langenhagen reported that a second meeting with Party A was held on May 22, 2001 and that a third meeting with Party A was scheduled for May 30, 2001. Mr. Langenhagen also reported on discussions between Broadview and David Hanssens of Thomson Legal and Regulatory, an affiliate of Thomson, and noted that Mr. Hanssens believed there was a strong potential strategic fit between the two companies and that Thomson was analyzing the financial impact of a potential transaction. Mr. Langenhagen also reported on several preliminary conversations with other potential acquirers as well as several preliminary conversations with parties which did not result in an expression of interest in consummating a transaction. On June 4, 2001 Broadview, Mr. Pollan and Mr. Benanto held meetings with Thomson regarding a potential transaction. Thomson expressed an interest in a potential transaction and noted Thomson's belief that NewsEdge could provide Thomson with a complimentary suite of goods and services that could further Thomson's long-term strategy. On June 11, 2001 Broadview reported receiving an offer from Party A. Party A's initial offer was a stock-for-stock transaction which valued NewsEdge at approximately $25 million. On June 14, 2001 Broadview received a revised offer from Party A which increased the valuation of NewsEdge to $33 million in a stock-for-stock transaction. During a meeting of the Board on June 18, 2001 Mr. Langenhagen submitted a third status report to the Board and reported on discussions with several potential acquirers. Mr. Langenhagen reported that Broadview received a non-binding letter of interest from Thomson on June 18, 2001 relating to a cash transaction which valued NewsEdge at no less than $1.60 per share. Mr. Langenhagen also reported that Broadview and representatives of NewsEdge held meetings with two other potential acquirers on June 15, 2001 and scheduled a second meeting with one of the parties for the week of June 18, 2001 to further discuss a potential transaction. Additionally, Mr. Langenhagen reported on preliminary discussions held with several other potential acquirers since Broadview's last status report on May 25, 2001. On June 21, 2001 Broadview held a follow-up due diligence meeting with one of the potential acquirers who had met with NewsEdge on June 15, 2001 ("Party B"). On June 26, 2001 Broadview received a preliminary letter of intent from Party B relating to a part cash, part stock transaction which valued NewsEdge at between $2.25 and $3.00 per share. The letter also indicated that Party B would require significant additional management time to further understand NewsEdge's business and that it would require a 45-day exclusivity period. 7 On June 27 and June 28, 2001 Mr. Pollan, other executive officers of NewsEdge, and representatives of Broadview met with Mr. Hanssens and other individuals from Thomson to conduct additional due diligence and discuss possible terms of an acquisition of NewsEdge by Thomson or one of its affiliated entities. During the June 28, 2001 meeting of the Board, Mr. Pollan and Mr. Langenhagen reported on the status of NewsEdge's conversations with potential acquisition partners. The directors reviewed the status of these discussions and potential offers. In particular, Mr. Pollan reported that Party B communicated an interest in continuing negotiations with NewsEdge and had submitted an incomplete preliminary indication of interest which remained subject to substantial additional due diligence and other conditions. Mr. Pollan also reported on the status of discussions with other potential acquirers. After discussion, the directors instructed management to continue discussions with each of the various interested parties. In particular, the directors instructed management to respond to indications of interest previously received with counterproposals seeking to elicit a higher valuation for NewsEdge and to respond to any preliminary indications of interest by communicating again the need to accelerate the timeframe during which to consider a potential transaction with NewsEdge and to submit firm indications of interest. During the last week of June, Party A sent representatives to meet with the Board and NewsEdge's executive management team to delineate their plans for an acquisition of NewsEdge and post-acquisition operations of NewsEdge. Party A's representatives indicated at this time that their acquisition strategy necessitated that any potential transaction be a stock-for-stock deal. On July 1, 2001 Mr. Pollan communicated with the Board via e-mail that negotiations with Party A centered around the valuation of NewsEdge. Mr. Pollan also informed the Board that he and other members of NewsEdge's executive team met with Mr. Hanssens and eight other Thomson representatives on June 27 and June 28, 2001. He reported that conversations with Thomson were progressing in a positive manner and that NewsEdge expected firm offers from Thomson and Party A by July 6, 2001. During the July 3, 2001 meeting of the Board, Mr. Pollan and Mr. Langenhagen reported on the status of NewsEdge's conversations with potential acquirers and the status of the letters of intent received to date. The directors then reviewed the status of these discussions and potential offers and directed management to continue discussions with a particular focus on Thomson and Party A. On July 5, 2001 Mr. Pollan communicated with the Board via e-mail that his recent conversations with Thomson were progressing positively and that NewsEdge would be evaluating offers over the course of the next week. Mr. Pollan also discussed issues surrounding the proposed timing of the initiation and closing of Thomson's proposed acquisition. Mr. Pollan reported that NewsEdge had received a revised letter of intent from Party B which valued NewsEdge between $2.25 and $2.50 per share to be paid half in cash and half in stock. Party B indicated that its offer was subject to a further due diligence review of NewsEdge's business operations which it expected to be able to complete by mid- to late-August. During the July 6, 2001 meeting of the Board, Mr. Pollan and Mr. Langenhagen reported on the status of NewsEdge's conversations with potential acquisition partners. The directors reviewed the status of these discussions and potential offers. In particular, Mr. Pollan reported that Party B had conveyed to NewsEdge, through Broadview, that its strategic imperative in any acquisition would be to combine the two companies and thereby eliminate duplicative positions. As a result of these requirements, the party would need to hold discussions with certain members of the management team not yet privy to NewsEdge's acquisition proceedings as part of its due diligence review. The party also indicated that any offer would be a combination of cash and stock and that it would require at least a month to complete its due diligence review of NewsEdge. At this time, Mr. Pollan also reported that Party A recently indicated that it might raise its potential valuation for NewsEdge provided that no 8 other major issues were outstanding. Mr. Pollan also reported that discussions with Thomson were ongoing. The directors discussed other terms and conditions of a potential business combination transaction. The directors directed Mr. Pollan and Mr. Langenhagen to continue discussions with each of the various interested parties. On July 9, 2001 NewsEdge received a verbal offer from Thomson, proposing to acquire NewsEdge pursuant to a cash tender offer which valued NewsEdge at $31 million plus cash on the balance sheet of NewsEdge at the time of the consummation of the transaction, which as of July 9, 2001 was estimated to be $14 million. Also on July 9, 2001 Party A increased its offer to a final offer of $38 million which was to be paid exclusively in the common stock of Party A. During the July 10, 2001 meeting of the Board, Mr. Pollan and Mr. Langenhagen reported on the status of NewsEdge's conversations with potential acquisition partners, including the verbal offer received on July 9, 2001 from Thomson. The directors reviewed the status of these discussions and each potential offer. In particular, Mr. Pollan reported that Thomson had indicated that, subject to the completion of final due diligence and certain other conditions, it would be interested in acquiring NewsEdge at a valuation of $31 million plus the amount of cash on NewsEdge's balance sheet, which as of July 9, 2001 was estimated to be $14 million. The directors compared this proposal, its terms and conditions, and its potential benefits and associated risks with the potential offers from Party A and Party B. Management reported that Party B had requested additional time for due diligence and would be unlikely to come back with a firm offer prior to the time that NewsEdge would likely need to make a firm commitment to either Thomson or Party A. Management also reported concerns about Party B's post-acquisition cash balance and less favorable strategic positioning relative to other combinations post-merger. After discussion, based on the amount and quality of consideration offered, the directors instructed management to continue to negotiate with Thomson with a view towards entering into a definitive agreement at the valuation discussed. During the week of July 16, 2001 Thomson representatives and Thomson's legal counsel performed an extensive due diligence review of NewsEdge in Burlington, Massachusetts. Representatives of Thomson's legal, financial and human resource teams met throughout the week with the executive officers and certain other senior employees of NewsEdge to discuss various issues relating to Thomson's proposed acquisition of NewsEdge. On July 23, 2001 Mr. Pollan communicated with the Board via e-mail on the status of Thomson's due diligence review and that Thomson was meeting internally on July 23, 2001 to discuss the results of the due diligence review. Additionally, he reported that he and Mr. Langenhagen had discussions with Mr. Hanssens on Friday, July 20, 2001 regarding valuation and closing costs issues. Mr. Pollan indicated that he expected to receive a draft Merger Agreement from Thomson later that same day or the next day. On July 25, 2001 Mr. Pollan led a conference call discussion with Mr. Benanto, Mr. Hanssens and other representatives of Thomson on open issues related to the merger negotiations. On July 26, 2001 NewsEdge received an initial draft of the Merger Agreement from Thomson's legal counsel. Thereafter, representatives of NewsEdge and Thomson negotiated the terms of a definitive merger agreement and Thomson's proposed tender offer and discussed any unresolved issues between the parties. These discussions focused primarily on the conditions to Thomson's obligation to initiate and consummate its tender offer and second-step merger and the timing of the initiation and closing of Thomson's tender offer. The discussions also focused on the circumstances under which the Board would be able to consider and respond to competing acquisition proposals and the size of the fee NewsEdge would have to pay Thomson if the Board decided to terminate the transaction in order to modify or withdraw its recommendation on the basis of a superior offer. During this time Mr. Pollan continued to discuss the terms and conditions of the proposed transaction with individual Board members via telephone calls and e-mails. 9 On July 31, 2001 Mr. Pollan, Mr. Benanto, Mr. Langenhagen, Mr. Hanssens and other representatives of Thomson agreed on final pricing of the transaction at approximately $43 million, after adjustments for transaction costs and working capital. On August 3, 2001 Mr. Pollan communicated with the Board via e-mail that negotiations with Thomson had progressed positively and that the two parties were very close to agreeing on all terms and conditions of Thomson's proposed tender offer and merger. Additionally, he reported that he expected that the Board would be asked to approve a definitive agreement and review Broadview's Fairness Opinion at a Board meeting on Monday, August 6. Thereafter, Thomson and NewsEdge discussed and negotiated the open provisions of the Merger Agreement. The parties also discussed and negotiated the Amended Employment Agreements and the Stockholders Agreement. On the evening of August 3, 2001 Thomson's legal counsel delivered a substantially final draft of the Merger Agreement which was distributed to the Board for their consideration. At a meeting held on August 6, 2001 the Board reviewed the status of the negotiations with Thomson and the terms of the definitive merger agreement. The Board also discussed competing offers and NewsEdge's prospects should it choose to remain independent. After reviewing the terms of the definitive merger agreement with Thomson and considering Broadview's Fairness Opinion and underlying data, the Board unanimously determined that the terms of the Offer and Merger with Thomson were fair to, and in the best interests of, the stockholders of NewsEdge, and unanimously resolved to recommend that the stockholders accept the Offer and tender their Shares pursuant to the Offer and approve and adopt the Merger Agreement. On August 6, 2001 the parties executed the Merger Agreement, the Stockholders Agreement and the Amended Employment Agreements. Thereafter, Thomson and NewsEdge issued a joint press release announcing the execution of the Merger Agreement. (B)(II) REASONS FOR THE RECOMMENDATION OF THE BOARD In approving the merger with Thomson and the transactions contemplated by the Merger Agreement, and recommending that all stockholders tender their Shares pursuant to the Offer, the Board considered a number of factors, including the following: - the Offer Price being offered by Thomson; - NewsEdge's prospects if it were to remain independent, including: - the resources necessary for the development of new products and services required over the near term for NewsEdge's future growth; - NewsEdge's ability to efficiently market and sell to and support its existing and new customers; - NewsEdge's ability to expand its distribution channels and electronic publishing technologies; - the challenge facing NewsEdge of dedicating significant resources to growth while at the same time trying to achieve profitability; and - the uncertainty surrounding the continued listing of NewsEdge's shares on the Nasdaq National Market. - the possible alternatives to the Thomson transaction, including the possibility of continuing to operate NewsEdge as an independent entity, the possibility of continuing to seek another strategic partner or continuing negotiations with other parties who had indicated interest, the 10 range of possible benefits to NewsEdge's stockholders of these alternatives and the timing and likelihood of accomplishing the goal of any of these alternatives; - the contacts that had been made with potential acquirers since the beginning of 2001 and the fact that although several companies with a potential strategic interest in acquiring NewsEdge had been contacted, Thomson's Offer had a very high likelihood of being consummated in a timely manner, represented the highest price per share to NewsEdge's stockholders and was the only offer which involved exclusively cash consideration; - the strategic value of NewsEdge in the hands of a company with significantly greater financial resources, such as Thomson, which is in a better position to optimize NewsEdge's products in the corporate enterprise market and which, as a large corporation, has access to greater resources not presently available to NewsEdge; - the historical and recent market prices of the Shares and the fact that Thomson's Offer will enable the holders of the Shares to realize a premium of greater than 90% over the prices at which the Shares traded before the execution of the Merger Agreement; - the financial analysis and presentation of Broadview, and the oral opinion of Broadview delivered on August 6, 2001 and subsequently confirmed in writing as the Fairness Opinion, to the effect that, as of such date and based upon and subject to certain matters stated in such opinion, the $2.30 per Share Offer Price to be received by holders of Shares (other than Shares held in the treasury of NewsEdge and Shares held by stockholders who perfect their appraisal rights under the DGCL) pursuant to the Offer and the Merger are fair to, and in the best interests of, such holders from a financial point of view (Such opinion was directed to the Board in its consideration of the transactions contemplated by the Merger Agreement and is directed only to the fairness from a financial point of view as of its date of the consideration to be received by the holders of Shares pursuant to the Offer and the Merger. The full text of the Fairness Opinion, which sets forth the assumptions made, matters considered and limitations on the review undertaken by Broadview, is attached as Annex B and is incorporated in this Schedule 14D-9 by reference. HOLDERS OF SHARES ARE URGED TO READ THE FAIRNESS OPINION CAREFULLY IN ITS ENTIRETY.); - the likelihood that Thomson's Offer will be completed, in light of the experience, reputation and financial capabilities of Thomson and the terms of the Merger Agreement; - the fact that directors, certain executives officers, and a principal stockholder of NewsEdge beneficially owning an aggregate of approximately 47.1% of the outstanding Shares were willing, as individual stockholders, to support the transaction by committing to Thomson under the Stockholders Agreement, to tender their Shares in the Offer; - the fact that the other conditions to Thomson's obligations to consummate the Offer and Merger are customary and, in the assessment of the Board, not unduly onerous; - the fact that the Offer and the Merger are not subject to any financing condition and that the Offer consists of exclusively cash consideration payable to the holders of Shares; - the consents and approvals required to complete the Offer and consummate the Merger (including regulatory clearance under anti-trust laws) and the favorable prospects for receiving such consents and approvals; - the fact that NewsEdge and Thomson have many complimentary lines of business and that NewsEdge could benefit from Thomson's various distribution channels and position in the marketplace; and 11 - the terms of the Merger Agreement including the conditions to the parties' respective obligations under the Merger Agreement. The Board also identified and considered a variety of potentially negative factors in its deliberations concerning the Merger, including, but not limited to: - the risk that the potential benefits sought in the Merger might not be fully realized; - the possibility that the Merger might not be completed and the resulting effect on the stock price of NewsEdge; and - the effect of the public announcement of the Merger on NewsEdge's immediate prospects. The Board unanimously believed that these risks were outweighed by the potential benefits of the Merger. In view of the wide variety of factors, both positive and negative, considered by the Board, the Board did not find it practical to, and did not, quantify or otherwise assign relative weights to the specific factors considered, and did not find that any factor was of special importance. Rather, the Board viewed its position and recommendations as being based on the totality of the information presented to and considered by it. In addition, it is possible that different members of the Board assigned different weights to the various factors described above. The foregoing discussion of the information and factors considered by the Board is not intended to be exhaustive but is believed to include the material factors considered by the Board. (C) INTENT TO TENDER After reasonable inquiry and to NewsEdge's knowledge, each executive officer and director of NewsEdge currently intends to tender all Shares held of record or beneficially owned by such person to Merger Sub in the Offer. In connection with the execution of the Merger Agreement, certain stockholders of NewsEdge entered into a Stockholders Agreement with Thomson and Merger Sub, pursuant to which such stockholders contractually committed to tender Shares beneficially owned by each of them, totaling 8,087,455 Shares. The following stockholders of NewsEdge (who, except for Mr. McLagan, are also executive officers and/or directors of NewsEdge) are party to the Stockholders Agreement: Clifford M. Pollan, Ronald Benanto, Rory J. Cowan, Basil P. Regan, Peter Woodward, Murat H. Davidson, Jr., Michael E. Kolowich, William A. Devereaux, James D. Daniell and Donald L. McLagan. ITEM 5. PERSONS/ASSETS RETAINED, EMPLOYED, COMPENSATED OR USED Pursuant to a letter agreement dated April 6, 2001, NewsEdge engaged Broadview to act as its financial advisor in connection with NewsEdge's intent to consider acquisition offers and, if requested by NewsEdge, to render the Board an opinion with respect to the fairness to the holders of Shares, from a financial point of view, of the consideration to be received in any acquisition of NewsEdge. Broadview focuses on providing merger and acquisition advisory services to information technology, communications and media companies. In this capacity Broadview is engaged in valuing such businesses, and maintains an extensive database of information technology, communications and media mergers and acquisitions for comparative purposes. As financial advisor to the Board, Broadview received a fee from NewsEdge upon the delivery of its Fairness Opinion. The Board selected Broadview because of its expertise, reputation and familiarity with NewsEdge. Pursuant to its agreement with Broadview, NewsEdge agreed to pay Broadview a fee for its financial advisory services in an amount equal to (i) a one time commitment fee of $50,000, (ii) a "success fee" upon closing of a business combination or other transaction of 2.00% of the first one 12 hundred million dollars of consideration and 1.25% of consideration above the first one hundred million dollars with a minimum fee of $1,000,000 that will be reduced to $750,000 for certain types of transactions, (iii) a $250,000 payment for delivery of the Fairness Opinion, and (iv) all reasonable out of pocket costs and expenses. NewsEdge has entered into information provider license agreements in the ordinary course of its business with certain affiliates of Thomson (the "Thomson Affiliates"). In NewsEdge's most recent fiscal year, these agreements resulted in aggregate revenues to NewsEdge from its customers of approximately $2,817,600 and royalty payments from NewsEdge to the Thomson Affiliates in an aggregate amount of approximately $1,693,700. Except as described above, neither NewsEdge nor any person acting on its behalf has or currently intends to employ, retain or compensate any person to make solicitations or recommendations with respect to the Offer or the Merger. ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY Donald L. McLagan, who together with his affiliates beneficially owns 2,149,999 Shares or approximately 10.6% of the outstanding Shares, sold 14,000 Shares during the period from July 24, 2001 to July 26, 2001. Except for the sale by Mr. McLagan and purchases in the ordinary course under NewsEdge's 1995 Employee Stock Purchase Plan, no transactions in the Shares have been effected during the past 60 days by NewsEdge or, to the knowledge of NewsEdge, any executive officer, director, affiliate or subsidiary of NewsEdge. ITEM 7. PURPOSES OF THE TRANSACTION AND PLANS OR PROPOSALS Except as described in this Schedule 14D-9, NewsEdge is not currently undertaking or engaged in any negotiations in response to the Offer that relate to (1) a tender offer or other acquisition of NewsEdge's securities by NewsEdge, any subsidiary of NewsEdge, or any other person; (2) an extraordinary transaction, such as a merger, reorganization or liquidation, involving NewsEdge or any subsidiary of NewsEdge; (3) a purchase, sale or transfer of a material amount of assets of NewsEdge or any subsidiary of NewsEdge; or (4) any material change in the present dividend rate or policy, or indebtedness or capitalization of NewsEdge. Except as described in this Schedule 14D-9, there are no transactions, resolutions of the Board, agreements in principle, or signed contracts in response to the Offer that relate to one or more of the events referred to in the preceding paragraph. ITEM 8. ADDITIONAL INFORMATION MERGER SUB'S DESIGNATION OF PERSONS TO BE ELECTED TO THE BOARD The Information Statement attached as Annex A to this Schedule 14D-9 is being furnished in connection with the possible designation by Merger Sub, pursuant to the terms of the Merger Agreement, of certain persons to be appointed to the Board other than at a meeting of NewsEdge's stockholders. STATE TAKEOVER LAWS. NewsEdge is incorporated under the laws of the State of Delaware. In general, Section 203 of the DGCL prevents an "interested stockholder" (generally a person who owns or has the right to acquire 15% or more of a corporation's outstanding voting stock, or an affiliate or associate thereof) from engaging in a "business combination" (defined to include mergers and certain other transactions) with a Delaware corporation for a period of three years following the date such person became an interested stockholder unless, among other things, prior to such date, the board of directors of the corporation approved either the business combination or the transaction in which the interested stockholder became an interested stockholder. On August 6, 2001, prior to the execution of 13 the Merger Agreement, the Board by unanimous vote of all directors approved the Merger Agreement and determined that the terms of the Offer and the Merger are fair to, and in the best interest of, the stockholders of NewsEdge. Accordingly, Section 203 is inapplicable to the Offer and the Merger. A number of other states have adopted laws and regulations applicable to attempts to acquire securities of corporations which are incorporated, or have substantial assets, stockholders, principal executive offices or principal places of business, or whose business operations otherwise have substantial economic effects, in such states. In EDGAR v. MITE CORP., the Supreme Court of the United States invalidated on constitutional grounds the Illinois Business Takeover Statute, which, as a matter of state securities law, made takeovers of corporations meeting certain requirements more difficult. However, in 1987 in CTS CORP. v. DYNAMICS CORP. OF AMERICA, the Supreme Court held that the State of Indiana may, as a matter of corporate law and, in particular, with respect to those aspects of corporate law concerning corporate governance, constitutionally disqualify a potential acquirer from voting on the affairs of a target corporation without the prior approval of the remaining stockholders. The state law before the Supreme Court was by its terms applicable only to corporations that had a substantial number of stockholders in the state and were incorporated there. NewsEdge, directly or through its subsidiaries, conducts business in a number of states throughout the United States, some of which have enacted takeover laws. NewsEdge does not know whether any of these laws will, by their terms, apply to the Offer or the Merger and has not complied with any such laws. Should any person seek to apply any state takeover law, NewsEdge will take such action as then appears desirable, which may include challenging the validity or applicability of any such statute in appropriate court proceedings. In the event it is asserted that one or more state takeover laws is applicable to the Offer or the Merger, and an appropriate court does not determine that it is inapplicable or invalid as applied to the Offer, NewsEdge might be required to file certain information with, or receive approvals from, the relevant state authorities. In addition, if enjoined, Merger Sub might be unable to accept for payment any Shares tendered pursuant to the Offer, or be delayed in continuing or consummating the Offer, and the Merger. In such case, Merger Sub may not be obligated to accept for payment any Shares tendered. ANTITRUST. The parties intend to notify the German Federal Cartel Office (the "FCO") of the proposed Merger as soon as possible. After an initial review of the proposed Merger by the FCO, which may last for one month, the FCO will decide whether to clear the proposed Merger or open a second stage investigation, which may last for a further period of three months. If following the investigation, the FCO has found that the proposed Merger would create or strengthen a dominant position in Germany, the FCO may take such actions as it deems necessary or desirable in the public interest to prevent the proposed Merger from being implemented in respect of the German market. The parties intend to submit the proposed Merger for approval by the Brazilian antitrust authorities. The Secretariat for Economic Monitoring and Secretariat of Economic Law will consider the proposed Merger and each will issue an opinion to the Administrative Council for Economic Defense (the "Council"), Brazil's antitrust tribunal. This Council will make a decision with respect to the proposed Merger. The review of the proposed Merger by the Brazilian antitrust authorities may take longer than six months, but will not prevent the proposed Merger from taking effect; provided, however, if the Council decides that the Merger is anti-competitive, it may impose restrictions on the parties or order an unwinding of the Merger. Thomson and NewsEdge conduct operations in a number of jurisdictions where other regulatory filings or approvals may be required or advisable in connection with the completion of the Merger. Thomson and NewsEdge are currently in the process of reviewing whether filings or approvals may be required or desirable in these jurisdictions which may be material to Thomson and NewsEdge and its subsidiaries. It is possible that one or more of these filings may not be made, or one or more of these 14 approvals, which are not as a matter of practice required to be obtained prior to effectiveness of a merger transaction, may not be obtained, prior to the Merger. REQUIRED VOTE OF STOCKHOLDERS Under the DGCL, if Merger Sub becomes the owner of 90% of the outstanding Shares as a result of the Offer, Merger Sub will be able to effect the Merger without the approval of NewsEdge's stockholders. However, if Merger Sub does not become the owner of 90% of the outstanding Shares, a meeting of stockholders will be required to approve the Merger. The affirmative vote of at least a majority of the outstanding Shares is required to approve the Merger. If Merger Sub consummates the Offer by acquiring at least a majority of the outstanding Shares, Merger Sub will be able to approve the Merger without the vote of any other stockholder. APPRAISAL RIGHTS Holders of the Shares do not have appraisal rights as a result of the Offer. However, if Merger Sub becomes the owner of 90% of the outstanding Shares and effects the Merger without approval of NewsEdge's stockholders, they can exercise appraisal rights in connection with the Merger. In addition, if Merger Sub does not acquire 90% of the outstanding Shares and calls a stockholders meeting to approve the Merger and if NewsEdge's Shares remain listed on a national securities exchange or are then quoted on the Nasdaq National Market or are held of record by more than 2,000 holders, NewsEdge stockholders will not have appraisal rights in connection with the Merger. However, if Merger Sub does not acquire 90% of the outstanding Shares and calls a stockholder meeting to approve the Merger and if NewsEdge's Shares are not listed on a national securities exchange or are not then quoted on the Nasdaq National Market or are not held of record by more than 2,000 holders, NewsEdge stockholders will have appraisal rights in connection with the Merger. Appraisal rights, including the procedures stockholders must follow in order effectively to demand and perfect such rights, are summarized under the caption "Appraisal Rights" in the Information Statement. The Delaware statute governing appraisal is attached to the Information Statement as Annex C. ITEM 9. MATERIAL TO BE FILED AS EXHIBITS Exhibit (a)(1)(i) Offer to Purchase, dated August 21, 2001 (incorporated by reference to Exhibit (a)(1) to the Schedule TO of Merger Sub filed on August 21, 2001). Exhibit (a)(1)(ii) Form of Letter of Transmittal (incorporated by reference to Exhibit (a)(2) to the Schedule TO of Merger Sub filed on August 21, 2001). Exhibit (a)(2)(i) Letter to Stockholders of NewsEdge, dated August 21, 2001.* Exhibit (a)(2)(ii) Fairness Opinion of Broadview International LLC, dated August 6, 2001 (included as Annex B to this Schedule 14D-9).* Exhibit (e)(1) Agreement and Plan of Merger, dated as of August 6, 2001, among NewsEdge, Thomson and Merger Sub. Exhibit (e)(2) Stockholders Agreement, dated as of August 6, 2001, among Thomson, Merger Sub and certain stockholders of NewsEdge. Exhibit (e)(3) Confidentiality Agreement, dated as of May 16, 2001 by and between Broadview International LLC, on behalf of NewsEdge, and West Group. Exhibit (e)(4) Amended and Restated Executive Employment Agreement dated August 6, 2001 between NewsEdge and Clifford M. Pollan. Exhibit (e)(5) Amended and Restated Executive Employment Agreement dated August 6, 2001 between NewsEdge and Ronald Benanto.
15 Exhibit (e)(6) Amended and Restated Executive Employment Agreement dated August 6, 2001 between NewsEdge and Charles White. Exhibit (e)(7) Amended and Restated Executive Employment Agreement dated August 6, 2001 between NewsEdge and Thomas Karanian. Exhibit (e)(8) Amended and Restated Executive Employment Agreement dated August 6, 2001 between NewsEdge and John Crozier. Exhibit (e)(9) Amended and Restated Executive Employment Agreement dated August 6, 2001 between NewsEdge and David Scott. Exhibit (e)(10) Amended and Restated Executive Employment Agreement dated August 6, 2001 between NewsEdge and Alton Zink. Exhibit (e)(11) Amended and Restated Executive Employment Agreement dated August 6, 2001 between NewsEdge and Lee Phillips. Exhibit (e)(12) Information Statement of NewsEdge, dated August 21, 2001 (included as Annex A to this Schedule 14D-9).* ANNEX A Information Statement ANNEX B Fairness Opinion of Broadview ANNEX C Delaware Statute Governing Appraisal
- ------------------------ * Included with the Schedule 14D-9 mailed to stockholders. 16 SIGNATURE After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. NEWSEDGE CORPORATION [LOGO] By: Clifford M. Pollan CHIEF EXECUTIVE OFFICER AND PRESIDENT Dated: August 21, 2001
17 ANNEX A NEWSEDGE CORPORATION 80 BLANCHARD ROAD BURLINGTON, MASSACHUSETTS 01803 INFORMATION STATEMENT PURSUANT TO SECTION 14(F) OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, AND RULE 14F-1 THEREUNDER This Information Statement is being mailed on or about August 21, 2001 as part of the Solicitation/Recommendation Statement on Schedule 14D-9 (the "Schedule 14D-9") of NewsEdge Corporation, a Delaware corporation ("NewsEdge"). On August 6, 2001, NewsEdge, The Thomson Corporation, a corporation incorporated under the laws of the Province of Ontario ("Thomson") and InfoBlade Acquisition Corporation, a Delaware corporation and an indirect wholly owned subsidiary of Thomson ("Merger Sub"), entered into an Agreement and Plan of Merger (the "Merger Agreement") pursuant to which Merger Sub will commence a tender offer (the "Offer") to purchase all the issued and outstanding shares of common stock, par value $0.01 per share, of NewsEdge (the "Common Stock" or the "Shares") at a price per share of $2.30, net to the seller in cash without interest. Following completion of the Offer and subject to the satisfaction or waiver of certain conditions contained in the Merger Agreement, Merger Sub will be merged with and into NewsEdge (the "Merger") and NewsEdge will become an indirect wholly owned subsidiary of Thomson. Pursuant to the Merger Agreement, Merger Sub commenced the Offer on August 21, 2001. The Offer is scheduled to expire at 12:00 midnight, New York City time, on Tuesday, September 18, 2001, unless the Offer is extended in accordance with the terms of the Merger Agreement. The Merger Agreement provides that upon the consummation of the Offer, and from time to time thereafter, NewsEdge will cause certain designees of Merger Sub (the "Thomson Designees") to be elected to the Board of Directors of NewsEdge (the "Board"). If, however, the Merger Agreement is terminated or if Merger Sub does not accept Shares tendered for payment, then Merger Sub will not have any right to designate directors for election to the Board. This Information Statement is being mailed to you in accordance with Section 14(f) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and Rule 14f-1 under the Exchange Act. This Information Statement supplements information in the Schedule 14D-9. Information herein relating to Thomson, Merger Sub or the Thomson Designees (as defined below) has been provided by Thomson and Merger Sub. You are urged to read this Information Statement carefully. You are not, however, required to take any action with respect to the information contained in this Information Statement at this time. Capitalized terms used herein but not otherwise defined shall have the meanings set forth in the Schedule 14D-9. The Common Stock is the only class of voting securities of NewsEdge outstanding. Each share of Common Stock entitles the holder thereof to one vote. As of August 6, 2001, there were 18,621,403 shares of Common Stock outstanding and 432,000 shares of Common Stock held by NewsEdge in treasury. A-1 DESIGNEES TO THE BOARD OF DIRECTORS OF NEWSEDGE Pursuant to the Merger Agreement, promptly upon the purchase by Merger Sub of Shares pursuant to the Offer, and from time to time thereafter, Merger Sub will be entitled to designate a number of directors to the Board, rounded up to the next whole number (but rounded down if rounding up would cause the Thomson Designees to constitute the entire Board), equal to the product of (i) the total number of directors on the Board (giving effect to the directors elected pursuant to Merger Sub's rights described herein) and (ii) the percentage that such aggregate number of Shares beneficially owned by Merger Sub or any affiliate of Merger Sub following such purchase bears to the aggregate number of Shares then outstanding. The Board is presently comprised of eight directors divided into three classes of directors (one class of two directors and two classes of three directors each) serving overlapping three-year terms. In order to appoint the Thomson Designees to the Board, NewsEdge will promptly take all actions necessary to cause the Thomson Designees to be elected as directors of NewsEdge, including increasing the size of the Board and/or securing the resignations of such numbers of incumbent directors. NewsEdge will use its reasonable best efforts to cause the Thomson Designees to constitute the same percentage as the Thomson Designees shall constitute of the entire Board of (i) each committee of the Board, (ii) each board of directors of each subsidiary of NewsEdge, and (iii) each committee of each such board, in each case only to the extent permitted by applicable law. Until the Effective Time, NewsEdge will use its reasonable best efforts to ensure that at least two members of the Board and each committee of the Board and such boards and committees of each subsidiary of NewsEdge, as of August 6, 2001, who are not employees of NewsEdge, shall remain members of the Board and of such boards and committees. After the Thomson Designees have been elected or appointed to the Board and before the Effective Time, any amendment of the Merger Agreement, any amendment of NewsEdge's Certificate of Incorporation or By Laws, any termination of the Merger Agreement by NewsEdge, any extension by NewsEdge of the time for performance of any of the obligations of Thomson or Merger Sub under the Merger Agreement or the waiver of NewsEdge's rights thereunder will require the approval of a majority of the directors then in office who neither were Thomson Designees nor are employees of NewsEdge or any subsidiary of NewsEdge. It is currently anticipated that Thomson will designate one or more of the individuals listed on Appendix 1 to this Information Statement as directors of NewsEdge following consummation of the Offer. Thomson expects that such representation would permit Thomson to exert substantial influence over NewsEdge's conduct of its business and operations. Thomson has informed NewsEdge that each of the individuals listed on Appendix 1 has consented to serve as a director, if so designated. If necessary, Thomson may select additional or other Thomson Designees, subject to the requirements of Rule 14f-1. None of the potential Thomson Designees listed on Appendix 1 (i) is currently a director of, or holds any position with, NewsEdge, (ii) has a familial relationship with any directors or executive officers of NewsEdge, or (iii) to NewsEdge's knowledge, beneficially owns any securities (or other rights to acquire any securities) of NewsEdge. Thomson has advised NewsEdge that, to Thomson's knowledge, none of the potential Thomson Designees listed on Appendix 1 has been involved in any transaction with NewsEdge or any of its directors, executive officers or affiliates that is required to be disclosed pursuant to the rules and regulations of the Securities and Exchange Commission (the "Commission"), except as may be disclosed in this Information Statement or in the Schedule 14D-9. A-2 CURRENT DIRECTORS, EXECUTIVE OFFICERS AND KEY EMPLOYEES OF NEWSEDGE The following table sets forth the directors, executive officers and key employees of NewsEdge, their ages and the positions currently held by each such person with NewsEdge. Ages are as of August 6, 2001. None of the directors, executive officers or key employees has any family relationship to any other director, executive officer or key employee of NewsEdge.
NAME AGE POSITION - ---- -------- -------------------------------------------------------- Clifford M. Pollan.......... 44 Chief Executive Officer, President and Director Ronald Benanto.............. 52 Vice President--Finance, Chief Financial Officer, Treasurer and Assistant Secretary Charles White............... 33 Vice President--E-Content Business Thomas Karanian............. 38 Vice President--Development, Operations and Customer Service John Crozier................ 42 Vice President--North American Sales David M. Scott.............. 40 Vice President--Corporate Marketing Alton Zink.................. 46 Vice President--Human Resources Lee Phillips................ 48 Vice President--Product Marketing Rory J. Cowan(2)............ 48 Chairman of the Board of Directors Michael E. Kolowich......... 47 Vice Chairman and Director James D. Daniell, 37 Director Ph.D.(1)(2)............... Murat H. Davidson, Jr....... 57 Director William A. Devereaux(1)..... 54 Director Basil P. Regan(1)........... 60 Director Peter Woodward(2)........... 28 Director
- ------------------------ (1) Member of Compensation Committee. (2) Member of Audit Committee. CLIFFORD M. POLLAN joined NewsEdge in 1989 as a Vice President, served as Vice President--Sales and Marketing from May 1995 to March 1999 and as President and Chief Operating Officer from April 1999. In March 2000, Mr. Pollan was elected Chief Executive Officer and joined the Board of Directors. From 1986 to 1989, Mr. Pollan was a Director of Sales at Lotus Development Corporation, a computer software company. RONALD BENANTO joined NewsEdge in July 1999 as Vice President--Finance and Operations, Treasurer and Assistant Secretary. From February 1998 to July 1999, Mr. Benanto served as Vice President, Finance at Genesis Direct, Inc., a direct marketing and e-commerce company. From October 1991 to December 1997, Mr. Benanto was the Senior Vice President, Finance and Chief Financial Officer at Viewlogic Systems, Inc., an electronic design automation company. CHARLES WHITE joined NewsEdge in May 1993 as a Marketing Representative. In February 1996, Mr. White was promoted to Manager of New Business Development, a position he held until 1997. In August 1997, Mr. White was promoted to Director of Workgroup Sales. In May 1999, Mr. White A-3 became the Director of Middle Markets, a position he held until June 2000, when he was promoted to Vice President--E-Content Business. THOMAS KARANIAN joined NewsEdge in September 1994 as Director--Quality Engineering and served as Director--Client Services from December 1996 through August 1999, at which time he became Vice President--Client Services and Operations. Prior to joining NewsEdge, Mr. Karanian was Quality Engineer Manager at Lotus Development Corporation, a computer software company. JOHN CROZIER joined NewsEdge in June 1994 as an Account Manager. In June 1997, Mr. Crozier was promoted to District Manager, a position he held until May 1998, when he was promoted to Area Director. In May 2000, Mr. Crozier was promoted to Vice President--North American Sales. DAVID M. SCOTT joined NewsEdge in November 1995 as Marketing Manager, Financial Markets. Mr. Scott became International Marketing Director in December 1997 and Corporate Marketing Director in December 1998. He has been in his current role of Vice President--Corporate Marketing since July 2000. Prior to joining NewsEdge, Mr. Scott was a Marketing Director in the e-Content division of Knight-Ridder, a news and information company. ALTON ZINK joined NewsEdge in March 1998 as Director--Human Resources. Mr. Zink became Vice President--Human Resources in April 1999. Prior to joining NewsEdge, Mr. Zink was Director of Corporate Human Resources at PictureTel Corporation, a telecommunications company, from 1989 to 1998. LEE PHILLIPS joined NewsEdge in July 2000 as Vice President--Product and Content. Mr. Phillips became Vice President--Product Marketing in June 2001. Prior to joining NewsEdge, Mr. Phillips was Vice President of Marketing and Business Development at eCopyit.com, Inc., a document solutions internet portal, from 1999 to 2000. From 1996 to 1999, Mr. Phillips was the Senior Vice President of Marketing and Business at GammaGraphX, Inc., a document solutions company. RORY J. COWAN has served on the Board of NewsEdge since May 1993 and was elected Chairman in March 2000. Since December 1996, Mr. Cowan has been Chairman and Chief Executive Officer of Lionbridge Technologies, an international software services company. From 1991 to 1995, Mr. Cowan was an Executive Vice President of R.R. Donnelley & Sons Company, a supplier of commercial print and print-related services. During 1995 and 1996, Mr. Cowan was also the Chief Executive Officer of Stream International, Inc., a software services company. Mr. Cowan also served as Chairman of Interleaf, Inc. from October 1996 to January 1997. Mr. Cowan currently serves as a director of Fairmarket, Inc. MICHAEL E. KOLOWICH joined NewsEdge in February 1998 as Vice Chairman and Director in connection with NewsEdge's merger with Individual, Inc. From September 1996 to February 1998, Mr. Kolowich served as Individual's President, Chief Executive Officer and Chairman of the Board of Directors. Prior to joining Individual, Mr. Kolowich served from July 1996 until September 1996 as Vice President/Business Operations of Nets Inc., an Internet content provider formed in June 1996 when AT&T New Media Services, a provider of interactive online information services for business professionals, merged with Industry.Net. Mr. Kolowich is a director of Learning Star Corp., a developer, manufacturer, and retailer of educational products. JAMES D. DANIELL, PH.D. became a director of NewsEdge in February 1998, in connection with NewsEdge's merger with Individual. Dr. Daniell served on Individual's board from 1997 until Individual's merger with NewsEdge. Dr. Daniell has been Chief Executive Officer of Celarix, Inc., a collaborative logistics software company since March 2001. Prior to joining Celarix, Dr. Daniell was Chief Executive Officer of Order Trust LLC, an electronic commerce company, from November 1997 until March 2001. From February 1997 to November 1997, Dr. Daniell served as Chief Operating Officer and Vice President of Strategy and New Business Development at AT&T Networked A-4 Commerce Services, an internet service provider. Dr. Daniell serves as Vice Chairman of the Massachusetts Software Council and is also on the Board of Advisors of espanol.com. MURAT H. DAVIDSON, JR. became a director of NewsEdge in June 2000. Mr. Davidson has been Managing Director of K2 Advisors, an investment firm, since March 2001. Prior to joining K2 Advisors, Mr. Davidson was a Managing Director of Regan Partners L.P., a limited partnership specializing in investments in turnaround companies and special situations, from 1996 to March 2001. WILLIAM A. DEVEREAUX became a director of NewsEdge in February 1998, in connection with NewsEdge's merger with Individual. Mr. Devereaux served on Individual's board from 1989 until the merger. Mr. Devereaux has been Managing Director of American Capital Company, a venture capital and merchant banking company, since 1988. BASIL P. REGAN became a director of NewsEdge in March 2000. In 1989, Mr. Regan founded and is presently a General Partner of Regan Partners, L.P. Mr. Regan is also President of Regan International Fund Ltd. and Regan Fund Management Ltd. PETER WOODWARD became a director of NewsEdge in March 2000. Since 1996, Mr. Woodward has been a research analyst with Regan Partners L.P. Prior to joining Regan Partners, Mr. Woodward was a research analyst for Munn, Bernhard & Associates, a New York investment management company, focusing on technology and related companies. The Board of Directors is divided into three classes, one of which consists of two directors and two of which consist of three directors each. Each director serves for a three-year term. All directors will hold office until their successors have been duly elected and qualified or until their earlier resignation or removal. Executive officers of the Corporation are elected by the Board of Directors on an annual basis and serve until their successors have been duly elected and qualified. BOARD MEETINGS AND COMMITTEES The Board met 14 times during the fiscal year ended December 31, 2000. Each of the directors attended at least 75% of the meetings of the Board during fiscal 2000. NewsEdge established an Audit Committee and Compensation Committee during fiscal 1995. The Audit Committee of the Board, of which Messrs. Cowan, Daniell and Woodward are currently members, is responsible for reviewing the results and scope of audits and other services provided by NewsEdge's independent auditors. The Audit Committee did not meet during fiscal 2000. The Compensation Committee, whose members currently are Messrs. Daniell, Devereaux and Regan, makes recommendations concerning the salaries and incentive compensation of executive officers, employees and consultants to NewsEdge and administers NewsEdge's stock plans. The Compensation Committee met twice during fiscal 2000. The Board does not have a standing nominating committee. DIRECTOR COMPENSATION On January 23, 1996, the Compensation Committee of the Board approved the Director Compensation Plan. Under the Director Compensation Plan, each non-employee director receives both an annual retainer of $5,000 and a fee of $1,000 for each Board meeting physically attended. A "non-employee director," for purposes of the Director Compensation Plan, is a director who is not an employee of NewsEdge. Non-employee directors are also reimbursed for their reasonable out-of-pocket travel expenses associated with their attendance at Board meetings. During the fiscal year ended December 31, 2000, Mr. Daniell earned $9,000, Mr. Devereaux earned $11,000, Mr. Davidson earned $8,000 and Messrs. Cowan, Regan and Woodward each earned $12,000 under the Director Compensation Plan. A-5 In addition, in order to provide an incentive to non-employee directors, options have been granted to non-employee directors pursuant to the 1995 Non-employee Director Stock Option Plan, as amended. Under this plan, each non-employee director received, on the date such person was first elected to the Board, an initial grant of an option to purchase 20,000 Shares, vesting over three years. A "non-employee director" for purposes of this plan, is a director, who is not an employee or officer of NewsEdge. Subsequent to the initial grant under this plan, each non-employee director who has attended at least 75% of the board meetings during the previous fiscal year received an option to purchase 2,500 shares of Common Stock, vesting on the first anniversary of the date of such grant. All options granted under this plan have an exercise price equal to the fair market value of the Common Stock on the date of grant. Each option granted under this plan will expire ten years from the date of grant. As of June 5, 2000, all options available under this plan had been granted, however NewsEdge continues to grant non-employee directors options under its 1995 Stock Plan, as amended. During the fiscal year ended December 31, 2000, Messrs. Cowan, Daniell and Devereaux each received options to purchase 2,500 shares at an exercise price of $2.75 per share. Messrs. Regan and Woodward each received options to purchase 20,000 shares at an exercise price of $2.00 per share and Mr. Davidson received options to purchase 20,000 shares at an exercise price of $2.75 per share. REPORT OF THE AUDIT COMMITTEE The following is the report of the Audit Committee with respect to NewsEdge's audited financial statements for 2000. This report shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended (the "Securities Act") or under the Exchange Act by any general statement of incorporation by reference, but shall only be deemed to be incorporated by reference if NewsEdge specifically incorporates the information by reference. In addition, this report shall not otherwise be deemed soliciting material or filed under these Acts. The primary purpose of the Audit Committee of the Board of Directors is to assist the Board in fulfilling its oversight responsibilities by reviewing (i) the financial information which is provided to the stockholders, governmental and regulatory bodies and others, (ii) the system of financial internal controls which management and the Board have adopted and (iii) the audit process. NewEdge's Audit Committee consists of three members of the Board of Directors, Rory J. Cowan, James D. Daniell and Peter Woodward, all of whom are "independent directors" for purposes of the National Association of Securities Dealers' listing standards. All members of the Audit Committee are financially literate and Rory J. Cowan, chairman of the Audit Committee, has extensive financial management experience. The Board adopted a written charter for the Audit Committee on May 4, 2000, a copy of which is attached hereto as Appendix 2. Management is responsible for the preparation, presentation and integrity of NewsEdge's financial statements, accounting and financial reporting principles and internal controls and procedures designed to assure compliance with accounting standards and applicable laws and regulations. The independent auditors, Arthur Andersen LLP, are responsible for performing an independent audit of the consolidated financial statements in accordance with generally accepted auditing standards. The Audit Committee discussed with NewsEdge's independent auditors the overall scope and plans for the audit. The Audit Committee meets with NewsEdge's internal finance and accounting staff and its independent auditors, with and without management present, to discuss the results of their examinations, their evaluations of NewsEdge's internal controls and the overall quality of NewsEdge's financial reporting. The Audit Committee has reviewed and discussed the audited financial statements for the fiscal year ended December 31, 2000, with NewsEdge's management and the independent auditors. The Audit Committee discussed with the independent auditors the matters required to be discussed by Statement on Auditing Standards No. 61, Communication with Audit Committees, as amended. In addition, the Committee has discussed with the independent auditors the auditor's independence from A-6 NewsEdge and its management, including the matters in the written disclosures required by Independence Standards Boards Standard No. 1, Independence Discussions with Audit Committee. Based upon these reviews and discussion, the Audit Committee recommended to the Board of Directors, and the Board of Directors approved, that the audited financial statements be included in NewsEdge's Annual Report on SEC Form 10-K for the fiscal year ended December 31, 2000. The members of the Audit Committee are not professionally engaged in the practice of auditing or accounting and are not experts in the fields of auditing or accounting, including in respect of auditor independence. Members of the committee rely without independent verification on the information provided to them and on the representations made by management and the independent auditors. Accordingly, the Audit Committee's oversight does not provide an independent basis to determine that management has maintained appropriate accounting and financial reporting principles or appropriate internal controls and procedures designed to assure compliance with accounting standards and applicable laws and regulations. Furthermore, the Audit Committee's considerations and discussions referred to above do not assure that the audit of NewsEdge's financial statements has been carried out in accordance with generally accepted auditing standards, that the financial statements are presented in accordance with generally accepted accounting principles or that Arthur Andersen LLP is in fact "independent" as required by the Nasdaq National Market. AUDIT COMMITTEE: Rory J. Cowan James D. Daniell Peter Woodward A-7 MANAGEMENT AND PRINCIPAL STOCKHOLDERS The following table presents information as to the beneficial ownership of Shares as of August 6, 2001 by: - each stockholder known by NewsEdge to be the beneficial owner of more than 5% of the Shares; - each director of NewsEdge; - each named executive officer of NewsEdge; and - all of NewsEdge's directors and executive officers as a group. Beneficial ownership is determined under the rules of the Commission and generally includes voting or investment power with respect to securities. Unless indicated below, to NewsEdge's knowledge, the persons and entities named in the table have sole voting and sole investment power with respect to all Shares beneficially owned, subject to community property laws where applicable. Shares subject to options that are currently exercisable or exercisable within 60 days of August 6, 2001 are deemed to be outstanding and to be beneficially owned by the person holding the options for the purpose of computing the percentage ownership of any other person. Unless indicated below, the address for each listed stockholder is c/o NewsEdge Corporation, 80 Blanchard Road, Burlington, Massachusetts 01803. The percentage of Shares outstanding as of August 6, 2001 is based on 18,621,403 Shares outstanding on that date and 1,722,728 Shares issuable pursuant to outstanding options and warrants exercisable within 60 days of August 6, 2001.
SHARES BENEFICIALLY PERCENTAGE NAME OWNED BENEFICIALLY OWNED - ---- -------------- ------------------ PRINCIPAL STOCKHOLDERS(1): Donald L. McLagan(2)........................................ 2,149,999 10.6% DIRECTORS: Rory J. Cowan(3)............................................ 122,794 * Michael E. Kolowich(4)...................................... 113,861 * William A. Devereaux(5)..................................... 286,557 1.41% James D. Daniell, Ph.D.(6).................................. 31,500 * Basil P. Regan(7)........................................... 5,707,197 28.05% Murat H. Davidson, Jr.(8)................................... 120,556 * Peter Woodward(9)........................................... 12,666 * NAMED OFFICERS: Clifford M. Pollan(10)...................................... 650,243 3.20% Ronald Benanto(11).......................................... 198,077 * Thomas Karanian(12)......................................... 123,538 * Jon McNerney(13)............................................ -- -- Charles White(14)........................................... 101,849 * ALL DIRECTORS AND EXECUTIVE OFFICERS AS A GROUP: (16 persons)(15)............................................ 7,701,410 37.86%
- ------------------------ * Represents less than 1% of the outstanding shares. (1) This information was obtained from filings made with the SEC pursuant to Sections 13(d) and 13(g) of the Securities and Exchange Act of 1934, as amended, and from information provided to NewsEdge by Mr. McLagan. A-8 (2) Includes 444,442 Shares held in trust for the benefit of Mr. McLagan's two children, of which Mr. McLagan's wife is the sole trustee. Mr. McLagan disclaims beneficial ownership of such Shares. (3) Includes 525,000 Shares issuable pursuant to outstanding stock options and warrants exercisable within 60 days of August 6, 2001. (4) Includes 8,000 Shares issuable pursuant to outstanding warrants exercisable within 60 days of August 6, 2001. (5) Includes 56,001 Shares issuable pursuant to outstanding stock options exercisable within 60 days of August 6, 2001. (6) Includes 25,000 Shares issuable pursuant to outstanding stock options exercisable within 60 days of August 6, 2001. (7) Includes 3,172,382 Shares held by Regan Partners, L.P.; 1,225,000 Shares held by the Regan International Fund, L.P.; 445,588 Shares held by The Wellcome Trust JD-84; 353,500 Shares held by Deutsche Daiwa Super Hedge Fund, L.P.; Mr. Regan is President and sole stockholder of Regan Fund Management, Ltd., general partner of Regan Partners L.P., Regan Fund Management Ltd. is the investment manager for Regan International Fund L.P., provides investment management services to The Wellcome Trust JD-84 and has a trading advisory agreement with Deutsche Daiwa Super Hedge Fund, L.P. Also includes 19,999 Shares issuable to Mr. Regan pursuant to outstanding stock options and warrants exercisable within 60 days of August 6, 2001; 173,333 Shares issuable to Regan Partners, L.P. pursuant to outstanding warrants exercisable within 60 days of August 6, 2001; 73,333 Shares issuable to Regan International Fund, L.P. pursuant to outstanding warrants exercisable within 60 days of August 6, 2001; and 153,333 Shares issuable to The Wellcome Trust JD-84 pursuant to outstanding warrants exercisable within 60 days of August 6, 2001. (8) Includes 5,000 Shares held by the 1992 Davidson Family Trust. Also includes 8,500 Shares held by Mr. Davidson's daughter and 23,529 Shares held by H.G. Wellington, Custodian for the benefit of the Murat H. Davidson Rollover IRA. Also includes 13,333 Shares issuable to H.G. Wellington, Custodian for the benefit of the Murat H. Davidson Rollover IRA pursuant to outstanding warrants exercisable within 60 days of August 6, 2001. Mr. Davidson disclaims beneficial ownership of such Shares. Also includes 13,333 Shares issuable to Mr. Davidson pursuant to outstanding warrants exercisable within 60 days of August 6, 2001 (9) Includes 6,666 Shares issuable pursuant to outstanding stock options exercisable within 60 days of August 6, 2001. (10) Includes 522,499 Shares issuable pursuant to outstanding stock options and warrants exercisable within 60 days of August 6, 2001. (11) Includes 188,665 Shares issuable pursuant to outstanding stock options and warrants exercisable within 60 days of August 6, 2001. (12) Includes 123,538 Shares issuable pursuant to outstanding stock options and warrants exercisable within 60 days of August 6, 2001. (13) Mr. McNerney resigned from NewsEdge effective January 15, 2001. (14) Includes 61,849 Shares issuable pursuant to outstanding stock options and warrants exercisable within 60 days of August 6, 2001. (15) Includes 1,722,728 Shares issuable pursuant to outstanding stock options and warrants exercisable within 60 days of August 6, 2001. A-9 EXECUTIVE COMPENSATION EXECUTIVE COMPENSATION SUMMARY The following table sets forth summary information concerning the compensation paid or earned for services rendered to NewsEdge in all capacities during the fiscal years ended December 31, 2000, 1999, and 1998 to (i) each individual who served as NewsEdge's Chief Executive Officer for the fiscal year ended December 31, 2000 and (ii) each of the other four most highly compensated executive officers of NewsEdge who received total annual salary and bonus in excess of $100,000 in the fiscal year ended December 31, 2000 (the "Named Executive Officers"). SUMMARY COMPENSATION TABLE
LONG-TERM COMPENSATION SECURITIES COMPENSATION UNDERLYING ALL OTHER NAME AND PRINCIPAL POSITION YEAR ANNUAL SALARY($) BONUS ($)(1) OPTIONS(#) COMPENSATION($)(2) - --------------------------- -------- ---------------- ------------ ------------ ------------------ Donald L. McLagan(3) ......... 2000 38,542 16,713 -- 147,298(4) Chairman, Chief Executive 1999 176,827 13,779 -- 800 Officer and Director 1998 156,000 19,991 100,500 800 Clifford M. Pollan(3) ........ 2000 232,496 89,780 300,000 840 President and Chief Executive 1999 172,497 44,690 120,000 800 Officer and Director 1998 156,000 35,591 80,500 800 Ronald Benanto ............... 2000 182,313 65,000 75,000 -- Vice President-Finance, Chief 1999 85,479 21,981 150,000 -- Financial Officer, Treasurer & 1998 -- -- -- -- Assistant Secretary Thomas Karanian .............. 2000 158,000 111,779 75,000 2,304 Vice President--Development, 1999 135,250 18,922 20,845 11,300 Operations and Customer 1998 91,500 13,313 16,750 2,289 Service Jon McNerney(5) .............. 2000 241,500 148,978 130,000 1,260 Senior Vice President-- 1999 238,500 19,991 40,000 26,707 Worldwide Sales 1998 174,000 -- 50,500 1,200 Charles White ................ 2000 160,000 101,256 77,000 17,910 Vice President--E-Content 1999 86,333 -- 10,845 106,910 Business 1998 58,083 6,487 13,966 59,656
- ------------------------ (1) Includes bonuses earned with respect to services rendered in the fiscal year indicated, whether or not such bonus was actually paid during such fiscal year. (2) Represents matching contributions made by NewsEdge to the Named Executive Officer under NewsEdge's 401(k) plan, commissions paid and gains on stock option exercises. (3) Mr. McLagan retired as NewsEdge's Chairman and Chief Executive Officer and as a Director of NewsEdge in March 2000. Effective March 14, 2000, Mr. Pollan was named Chief Executive Officer and was appointed to the Board of Directors. (4) Also includes severance payments made to Mr. McLagan subsequent to his retirement in March 2000. (5) Mr. McNerney resigned from NewsEdge effective January 15, 2001. A-10 OPTION/SAR GRANTS IN LAST FISCAL YEAR The following table provides certain information concerning grants of options to purchase NewsEdge's Common Stock made during the year ended December 31, 2000 to each of the Named Executive Officers. No stock appreciation rights ("SARs") were granted during the fiscal year ended December 31, 2000. OPTION/SAR GRANTS IN LAST FISCAL YEAR INDIVIDUAL GRANTS
NUMBER OF PERCENT OF TOTAL SECURITIES OPTIONS/SARS UNDERLYING GRANTED TO EXERCISE OR GRANT DATE OPTIONS/SARS EMPLOYEES IN BASE PRICE EXPIRATION PRESENT $/VALUE NAME GRANTED FISCAL YEAR ($/SHARE) DATE (1) - ---- ------------ ---------------- ----------- ---------- --------------- Donald L. McLagan................ -- -- -- -- -- Clifford M. Pollan............... 300,000(2) 13.3% $2.25 4/13/10 $570,000 Ronald Benanto................... 75,000(2) 3.3% $2.25 4/13/10 $142,500 Thomas Karanian.................. 75,000(2) 3.3% $2.25 4/13/10 $142,500 Jon McNerney..................... 130,000(2) 5.8% $2.25 4/13/10 $247,000 Charles White.................... 42,500(2) $2.25 4/13/10 $ 80,750 34,500(2) 3.4%(3) $2.00 6/5/10 $ 65,550
- ------------------------ (1) In accordance with Securities and Exchange Commission rules, the Black-Scholes option pricing model was chosen to estimate the grant date present value of the options set forth in this table. NewsEdge's use of this model should not be construed as an endorsement of its accuracy at valuing options. All stock option valuation models, including the Black-Scholes model, require a prediction about the future movement of the stock price. The following assumptions were made for purposes of calculating the Grant Date Present Value: an option term of 5 years, volatility at 1.41, interest rate at (5.17-6.69)%. The real value of the options in this table depends upon the actual performance of NewsEdge's stock during the applicable period. (2) One-half of all options granted will vest six months from the grant date with the remainder vesting on the one year anniversary of the grant date. (3) Represents percentage of the total options granted of 77,000 shares.
VALUE OF UNEXERCISED NUMBER OF UNDERLYING IN-THE-MONEY UNEXERCISED OPTIONS AT FISCAL OPTIONS/SARS AT FISCAL YEAR-END YEAR-END --------------------------- SHARES ACQUIRED --------------------------- EXERCISABLE UNEXERCISABLE NAME ON EXERCISE VALUE REALIZED EXERCISABLE UNEXERCISABLE ($)(1) ($)(1) - ---- --------------- -------------- ----------- ------------- ----------- ------------- Donald L. McLagan.......... -- -- 71,333 29,167 -- -- Clifford M. Pollan......... -- -- 320,907 224,593 -- -- Ronald Benanto............. -- -- 108,333 116,667 -- -- Thomas Karanian............ 74 $264 79,076 54,302 -- -- Jon McNerney............... -- -- 92,915 162,984 -- -- Charles White.............. -- -- 65,342 43,799 -- $232
- ------------------------ (1) Value is based on the difference between the option exercise price and the fair market value at December 29, 2000 ($0.906 per share as quoted on the Nasdaq National Market) multiplied by the number of shares underlying the option. A-11 EMPLOYMENT AGREEMENTS On January 18, 2001, Mr. Pollan, Mr. Benanto, Mr. White, Mr. Karanian, Mr. Crozier, Mr. Scott, Mr. Zink and Mr. Phillips (each an "Officer") each entered into employment agreements with NewsEdge. On April 1, 2001 Mr. Pollan, Mr. Benanto, Mr. White, Mr. Karanian, Mr. Crozier and Mr. Phillips entered into an amended employment agreement that amended and replaced their January 18, 2001 agreements (each of these amended agreements and the January 18, 2001 agreements of Messrs. Scott and Zink, the "Original Employment Agreements"). Unless employment is terminated earlier, each Original Employment Agreement provides for an undefined term of employment until either party gives notice of termination with at least 30 days written notice. The Original Employment Agreements provide for annual base salaries of $275,000 for Mr. Pollan, $210,000 for Mr. Benanto, $185,000 for each of Messrs. White and Karanian, $180,000 for Mr. Crozier, $160,000 for Mr. Scott and $150,000 for each of Messrs. Zink and Phillips. Each Officer is also eligible to participate in NewsEdge's standard benefit plans, accrue paid vacation time and receive an annual performance-based bonus of up to 50% of each Executive's annual salary. The Original Employment Agreements would entitle each Officer to a "change of control" bonus. This "change of control" bonus would be equal to six months' compensation, including base salary and target bonus, for each of the Officers (other than Mr. Pollan) and 12 months' compensation, including base salary and target bonus for Mr. Pollan. In connection with the Offer and the Merger, on August 6, 2001, each of the Officers entered into an Amended and Restated Employment Agreement with NewsEdge for one year terms (the "Amended Employment Agreements"), which supersede each Officer's Original Employment Agreement (provided that the Merger Agreement is not terminated prior to the Effective Time in which case the Amended Employment Agreements shall automatically terminate and have no further force or effect and the Original Employment Agreements shall be automatically reinstated upon the termination of the Merger Agreement prior to the Effective Time). Accordingly, no "change of control" bonus will be payable pursuant to the Original Employment Agreements. The Amended Employment Agreements provide annual base salaries for each Officer which are equal to those provided under the Original Employment Agreements. Under the Amended Employment Agreements upon the earlier of to occur of the date of the purchase of the Shares pursuant to the Offer and the date of the Effective Time of the Merger, each Officer will be paid the one-time "change of control" bonus equal to the amount that would be payable to the Officer under such Officer's Original Employment Agreement, as described above. The Amended Employment Agreements further provide that if the Officer is an active employee of NewsEdge on the one-year anniversary of the date of the Amended Employment Agreement, the Officer will be paid, in the case of all Officers other than Mr. Pollan, a bonus equal to 12 months' base salary and in the case of Mr. Pollan a bonus equal to $365,000. The Amended Employment Agreements also provide that during the term of the Amended Employment Agreement and, with respect to clauses (i), (iii) and (iv) below, for a period equal to 12 months after the termination of the Officer's employment by NewsEdge (or any affiliate thereof) or, with respect to clause (ii) below, 18 months after the termination of the Officer's employment by NewsEdge (or any affiliate thereof) (the "Restricted Period"), the Officer shall not (i) engage in certain restricted activities, including engaging in the businesses of developing, operating, offering for sale and selling news or other current information or software-based solutions pertaining thereto to corporations and other businesses, government agencies, universities and other academic institutions and professional services providers; (ii) be an employee or consultant of, or provide services to, certain competitors of NewsEdge or any of their respective direct or indirect subsidiaries; (iii) subject to certain exceptions, have an interest in any person engaged in the restricted activities set forth in clause (i) above in any capacity, including, without limitation, as a partner, shareholder, officer, A-12 director, principal, agent, employee, trustee or consultant or any other relationship or capacity; or (iv) interfere with business relationships between NewsEdge or any of its affiliates and customers or suppliers of NewsEdge or any of its affiliates. Each of the Officers agreed that, during the term of the Amended Employment Agreement and at all times thereafter, they shall treat as confidential and, except as required in the performance of their duties and responsibilities under their Amended Employment Agreement, not disclose, publish or otherwise make available to the public or to any individual, firm or corporation any confidential information of NewsEdge or Thomson (and its affiliates) except if the confidential information (i) becomes generally available to the public other than as a result of a disclosure by the Officer, (ii) was available to the Officer on a non-confidential basis prior to his employment with NewsEdge or (iii) becomes available to the Officer on a non-confidential basis from a source other than NewsEdge or Thomson (and it affiliates) or any of their business partners, provided that such source is not bound by a confidentiality agreement with NewsEdge or Thomson or any such business partners. The Amended Employment Agreements also provide that during the Restricted Period, the Officer shall not (i) hire or attempt to hire, or (ii) solicit or entice or attempt to solicit or entice away, any person who is (at the applicable time or was within the six month period prior to any such hire, solicitation or enticement) an officer, employee or consultant of NewsEdge or Thomson Legal & Regulatory (including without limitation The Dialog Corporation plc ("Dialog")) (in the case of clause (i) above) or NewsEdge or Thomson (in the case of clause (ii) above), as applicable, either for his own account or for any individual, firm or corporation, whether or not such person would commit any breach of his contract of employment by reason of leaving the service of NewsEdge, Thomson or Thomson Legal & Regulatory (including without limitation Dialog), as applicable. Each Officer further agreed that all discoveries, inventions, processes, methods and improvements, conceived, developed or otherwise made by the Officer at any time, alone or with others in any way relating to NewsEdge's present or future business or products, whether patentable or subject to copyright protection and whether or not reduced to practice, during the period of the Officer's employment with NewsEdge (the "Developments"), shall be the sole property of NewsEdge and assigned to NewsEdge all of the Officer's right, title and interest throughout the world in and to all such Developments. COMPENSATION COMMITTEE'S REPORT ON EXECUTIVE COMPENSATION This report is submitted by the Compensation Committee. The Compensation Committee during fiscal year 2000 initially comprised Ms. June Rokoff and Messrs. Cowan and Daniell, each of whom are non-employee directors. In March 2000, subsequent to Ms. Rokoff's resignation from the Board of Directors, the Compensation Committee was re-constituted to comprise Messrs. Daniell, Devereaux and Regan, who are also non-employee directors. Pursuant to authority delegated by the Board of Directors, the Compensation Committee is responsible for reviewing and administering NewsEdge's stock plans and reviewing and approving compensation matters concerning the executive officers, employees and consultants to NewsEdge. CASH COMPENSATION. Messrs. McLagan, Pollan, Benanto, Karanian, McNerney and White each received annual base salaries of $38,542, $232,496, $182,313, $158,000, $241,500 and $160,000, respectively through December 31, 2000. The Compensation Committee attempts to keep the base salary for NewsEdge's executive officers competitive by comparing it with those of other companies in the syndicated content and electronic publishing technologies industries and other companies with similar market capitalizations. The Compensation Committee's goal is to align the interests of NewsEdge's executive officers with its stockholders by incenting them through performance based bonuses and equity compensation. A-13 On February 13, 1997, the Compensation Committee of the Board of Directors approved a short-term cash incentive compensation plan (the "Accountability Group Bonus Plan"), which provides that the executive officers, along with other designated members of senior management, receive bonuses based upon NewsEdge's financial performance in the current fiscal year. Each executive officer's bonus may range from zero to a maximum amount determined by reference to the final audited financial statements of NewsEdge. During the fiscal year ended December 31, 2000, Messrs. McLagan, Pollan, Benanto, Karanian, McNerney and White each earned a bonus of $16,713, $89,780, $65,000, $111,779, $148,978 and $101,256, respectively pursuant to the Accountability Group Bonus Plan. EQUITY COMPENSATION. NewsEdge's equity compensation program is designed to provide long-term incentives to executive officers to encourage executive officers to remain with NewsEdge and to provide executives with the opportunity to obtain significant, long-term stock ownership. The Compensation Committee generally grants options that become exercisable over a three-year period and that have exercise prices equal to the fair market value of the Common Stock on the date of grant. However, in the case of executive officers who beneficially own more than ten percent (10%) of NewsEdge's Common Stock, the Internal Revenue Code of 1986, as amended, requires that the exercise price of incentive stock options granted to such executive officers be 110% of the fair market value of the Common Stock on the date of grant. In 2000, pursuant to the 1995 Stock Plan, the compensation Committee granted 299,998 non-qualified stock options to Mr. Pollan, 74,996 non-qualified stock options to Mr. Benanto, 75,000 non-qualified stock options to Mr. Karanian, 130,000 non-qualified stock options to Mr. McNerney, and 51,751 non-qualified stock options to Mr. White. In addition, the Compensation Committee granted two incentive stock options to Mr. Pollan, four incentive stock options to Mr. Benanto, 25,249 incentive stock options to Mr. White and 2,688 incentive stock options to Mr. Karanian. OTHER BENEFITS. NewsEdge also has various broad-based employee benefit plans. Executive officers participate in these plans on the same terms as eligible, non-executive employees, subject to any legal limits on the amounts that may be contributed or paid to executive officers under these plans. NewsEdge offers a stock purchase plan under which employees may purchase Common Stock at a discount. NewsEdge also maintains insurance and other benefit plans for its employees. TAX DEDUCTIBILITY OF EXECUTIVE COMPENSATION. In general, under Section 162(m) of the Internal Revenue Code of 1986, as amended (the "Code"), NewsEdge cannot deduct for federal income tax purposes, compensation in excess of $1 million paid to certain executive officers. This deduction limitation does not apply, however, to compensation that constitutes "qualified performance-based compensation" within the meaning of Section 162(m) of the Code and the Treasury Regulations promulgated thereunder. The Compensation Committee has considered the limitations on deductions imposed by Section 162(m) of the Code, and it is the Compensation Committee's present intention that, for so long as it is consistent with its overall compensation objective, substantially all tax deductions attributable to executive compensation will not be subject to the deduction limitations of Section 162(m) of the Code. Respectfully submitted by the members of the Compensation Committee of the Board of Directors: William A. Devereaux James D. Daniell Basil P. Regan June Rokoff (1) - ------------------------ (1) Ms. Rokoff resigned from the Compensation Committee and the Board of Directors on March 13, 2000. A-14 COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION Interlocks. The Compensation Committee during fiscal year 2000 was initially comprised of Ms. June Rokoff and Messrs. Cowan and Daniell. In March 2000, subsequent to Ms. Rokoff's resignation, NewsEdge's Compensation Committee was reconstituted and currently consists of Messrs. Daniell, Devereaux and Regan. No executive officer of NewsEdge served as a member of the compensation committee of another entity (or other committee of the board of directors performing equivalent functions or, in the absence of any such committee, the entire board of directors) of which either Messrs. Daniell, Devereaux or Regan is an executive officer. STOCK PRICE PERFORMANCE The following graph compares the percentage change in the cumulative total stockholder return on NewsEdge's Common Stock during the period from NewsEdge's initial public offering on August 11, 1995 through December 31, 2000, with the cumulative total return for the Nasdaq Stock Market (U.S. Companies) and the Nasdaq Computer and Data Processing Services Stock Index (the "Nasdaq Computer Index"). The comparison assumes $100 were invested on August 11, 1995 in NewsEdge Common Stock at the $15.00 initial offering price and in each of the foregoing indices and assumes reinvestment of dividends, if any. EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
NEWSEDGE CORPORATION NASDAQ COMPOSITE NASDAQ COMPUTER 8/11/95 $100.00 $100.00 $100.00 9/29/95 $232.00 $104.00 $102.00 12/29/95 $163.00 $105.00 $106.00 3/29/96 $245.00 $110.00 $111.00 6/28/96 $222.00 $119.00 $124.00 9/30/96 $193.00 $124.00 $126.00 12/31/96 $128.00 $130.00 $131.00 3/31/97 $85.00 $122.00 $122.00 6/30/97 $73.00 $145.00 $156.00 9/30/97 $68.00 $169.00 $171.00 12/31/97 $61.00 $159.00 $161.00 3/31/98 $94.00 $186.00 $213.00 6/30/98 $66.00 $191.00 $236.00 9/30/98 $58.00 $173.00 $223.00 12/31/98 $78.00 $223.00 $288.00 3/31/99 $57.00 $251.00 $347.00 6/30/99 $52.00 $275.00 $361.00 9/30/99 $62.00 $281.00 $374.00 12/31/99 $78.00 $415.00 $634.00 3/31/00 $28.00 $467.00 $624.00 6/30/00 $17.00 $406.00 $510.00 9/30/00 $13.00 $374.00 $471.00 12/31/00 $6.00 $250.00 $291.00
- ------------------------ (1) Prior to August 11, 1995 NewsEdge's Common Stock was not publicly traded. Comparative data is provided only for the period since that date. This chart is not "solicited material", is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference in any filings of NewsEdge under the Securities Act or the Exchange Act whether made before or after the date hereof and irrespective of any general incorporation language in any such filing. (2) The stock price performance shown on the graph is not necessarily indicative of future price performance. Information used on this graph was obtained from the Nasdaq National Market System and the Nasdaq Computer indices were prepared for Nasdaq by the Center for Research in Security Prices at the University of Chicago, a source believed to be reliable, although NewsEdge is not responsible for any errors or omissions in such information. A-15 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS William Blair & Company, an affiliate of William Blair Venture Partners III ("Blair"), is a customer of NewsEdge and was billed an aggregate of approximately $115,000 in NewsEdge subscriber fees in the year ended December 31, 2000. Ms. Carnahan, a general partner of Blair, served on the Board of Directors of NewsEdge through March 2000. In connection with NewsEdge's merger with Individual, Inc., NewsEdge entered into an employment agreement with Michael E. Kolowich, NewsEdge's Vice Chairman and Director and formerly the Chairman, President and Chief Executive Officer of Individual. Under this employment agreement, Mr. Kolowich served as a full-time senior executive consultant to NewsEdge from February 24, 1998 (the effective date of the merger with Individual (the "Individual Effective Date") until April 30, 1998 (the "Transition Period"). From May 1, 1998 until the third anniversary of the Individual Effective Date, Mr. Kolowich served as a senior executive consultant to NewsEdge (the "Remaining Term"). Furthermore, during the term of his employment agreement, NewsEdge agreed to take all action necessary and proper to cause Mr. Kolowich to be elected to NewsEdge's Board of Directors and to serve as the Vice Chairman of NewsEdge. Pursuant to the employment agreement, Mr. Kolowich received a salary at the annual rate of $350,000 during the Transition Period and $50,000 during the Remaining Term. Mr. Kolowich was eligible to participate in the benefits plans maintained by NewsEdge during the term of the employment agreement. Also, under the terms of the employment agreement, Mr. Kolowich will be bound by non-competition and non-disclosure requirements. Upon the Individual Effective Date, NewsEdge assumed all stock options then held by Mr. Kolowich all of which became immediately exercisable, with the exception of 784 shares. In March 2000, NewsEdge entered into a severance agreement and release with Donald L. McLagan in connection with his retirement as Chief Executive Officer and Chairman. Under the terms of the severance agreement and release, Mr. McLagan received severance at an annual rate of $185,000 commencing March 14, 2000 up to and through March 14, 2001. NewsEdge further agreed that Mr. McLagan's options would be exercisable until March 14, 2001. Also under the terms of the severance agreement and release, Mr. McLagan was bound by non-competition, non-solicitation and non-disclosure requirements through March 14, 2001. On January 18, 2001 each Officer entered into employment agreements with NewsEdge. On April 1, 2001, Mr. Pollan, Mr. Benanto, Mr. White, Mr. Karanian, Mr. Crozier and Mr. Phillips entered into an amended employment agreement that amended and replaced their January 18, 2001 agreements (each of these amended agreements and the January 18, 2001 agreements of Messrs. Scott and Zink, the "Original Employment Agreements"). Unless employment is terminated earlier, each Original Employment Agreement provides for an undefined term of employment until either party gives notice of termination with at least 30 days written notice. The Original Employment Agreements provide for annual base salaries of $275,000 for Mr. Pollan, $210,000 for Mr. Benanto, $185,000 for each of Messrs. White and Karanian, $180,000 for Mr. Crozier, $160,000 for Mr. Scott and $150,000 for each of Messrs. Zink and Phillips. Each Officer is also eligible to participate in NewsEdge's standard benefit plans, accrue paid vacation time and receive an annual performance-based bonus of up to 50% of each Executive's annual salary. The Original Employment Agreements would entitle each Officer to a "change of control" bonus. This "change of control" bonus would be equal to six months' compensation, including base salary and targeted bonus, for each of the Officers (other than Mr. Pollan) and 12 months' compensation, including base salary and target bonus for Mr. Pollan. In connection with the Offer and the Merger, each of the Officers have entered into an Amended Employment Agreement with NewsEdge for one year terms, which supersedes each Officer's Original Employment Agreement (provided that the Merger Agreement is not terminated prior to the Effective Time in which case the Amended Employment Agreement shall automatically terminate and have no A-16 further force or effect and the Original Employment Agreement shall be automatically reinstated upon such termination of the Merger Agreement). Accordingly, no "change of control" bonus will be payable pursuant to the Original Employment Agreements. The Amended Employment Agreements provide annual base salaries for each Officer which are equal to those provided under the Original Employment Agreements. Under the Amended Employment Agreements upon the earlier to occur of the date of the purchase of the Shares pursuant to the Offer and the date of the Effective Time of the Merger, each Officer will be paid the one-time "change of control" bonus equal to the amount that would be payable to the Officer under such Officer's Original Employment Agreement, as described above. The Amended Employment Agreements further provide that if the Officer is an active employee of NewsEdge on the one-year anniversary of the date of the Amended Employment Agreement, the Officer will be paid, in the case of all Officers other than Mr. Pollan, a bonus equal to 12 months' base salary and in the case of Mr. Pollan a bonus equal to $365,000. See "Employment Agreements" above. COMPLIANCE UNDER SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934 Section 16(a) of the Exchange Act requires NewsEdge's directors and executive officers, and persons who own more than 10% of a registered class of NewsEdge's equity securities (collectively, "Insiders"), to file initial reports of ownership and reports of changes in ownership with the Commission. The Commission regulations also require Insiders to furnish NewsEdge with copies of all Section 16(a) forms they file. Based solely on its review of the copies of the forms furnished to NewsEdge and written representations from directors and executive officers, NewsEdge believes that its Insiders complied with all applicable Section 16(a) filing requirements for 2000. APPRAISAL RIGHTS No appraisal rights are available in connection with the Offer. Notwithstanding the foregoing, if the Merger is consummated, holders of Shares who have not tendered their Shares or, if applicable, voted in favor of the Merger will have certain rights under the Delaware General Corporation Law (the "DGCL") to dissent from the Merger and demand appraisal of, and to receive payment in cash of the fair value of, their Shares. Holders of Shares who perfect such rights by complying with the procedures set forth in Section 262 of the DGCL ("Section 262") will have the "fair value" of their Shares (exclusive of any element of value arising from the accomplishment or expectation of the Merger) determined by the Delaware Court of Chancery and will be entitled to receive a cash payment equal to such fair value for NewsEdge, as the surviving corporation of the Merger. In addition, such dissenting holders of Shares would be entitled to receive payment of a fair rate of interest from the date of consummation of the Merger on the amount determined to be the fair value of their Shares. To NewsEdge's knowledge, Thomson and Merger Sub do not intend to object, assuming the proper procedures are followed, to the exercise of appraisal rights by any stockholder and the demand for appraisal of, and payment in cash for the fair value of, the Shares. To NewsEdge's knowledge, Thomson and Merger Sub intend, however, to cause NewsEdge, as the surviving corporation of the Merger, to argue in an appraisal proceeding that, for purposes of such proceeding, the fair value of each Share is less than or equal to the Merger Consideration. The foregoing summary of the rights of dissenting stockholders under the DGCL does not purport to be a complete statement of the procedures to be followed by holders of Shares desiring to exercise any dissenters' rights under the DGCL. The preservation and exercise of dissenters' rights require strict adherence to the applicable provisions of the DGCL. The complete text of Section 262 is attached to this Information Statement as Annex C. A-17 APPENDIX 1 THOMSON DESIGNEES The following table sets forth the name, age, current business address, citizenship and present principal occupation or employment, and material occupations, positions, offices or employment and business addresses thereof for the past five years of each person who may be designated to the Board of NewsEdge by Merger Sub. Except for David J. Hulland, who is a citizen of Great Britain, each such person is a citizen of the United States. Unless otherwise indicated, the current business address of each person is InfoBlade Acquisition Corporation, Metro Center, One Station Place, Stamford, Connecticut 06902.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT; MATERIAL POSITIONS HELD DURING THE NAME, AGE AND CURRENT BUSINESS ADDRESS PAST FIVE YEARS AND BUSINESS ADDRESSES THEREOF - -------------------------------------- ------------------------------------------------------------------------------ Michael S. Harris, 51 ............ Director of Merger Sub since July 2001. Senior Vice President, General Counsel The Thomson Corporation and Secretary of Thomson since May 1998. Vice President and General Counsel of Metro Center Thomson Holdings, Inc. ("THI"), Metro Center, One Station Place, Stamford, CT One Station Place, 06902, since June 1993. Assistant Secretary and Assistant General Counsel of Stamford, CT 06902, THI from May 1989 to June 1993. USA David J. Hulland, 51 ............. Director of Merger Sub since July 2001. Vice President Finance of Thomson The Thomson Corporation since September 1999. Vice President and Group Controller of Thomson from May Metro Center 1993 to September 1999. Group Controller of Thomson from 1977 to May 1993. One Station Place Stamford, CT 06902 USA Edward A. Friedland, 45 .......... Director, Vice President and Secretary of Merger Sub since July 2001. Thomson Financial Assistant Secretary of Thomson since May 2000. Deputy General Counsel of Metro Center Thomson since 1998. Assistant General Counsel of Thomson from 1994 to 1998. One Station Place Associate General Counsel of the Information/ Publishing Group from 1990 to Stamford, CT 06902 1993. Currently serving a second term on the Board of Directors for the USA Software & Information Industry Association. Dennis J. Beckingham, 53 ......... President of Merger Sub since July 2001. Executive Vice President and Chief Thomson Legal and Regulatory Financial Officer of Thomson Legal and Regulatory since 1996. 610 Opperman Drive St. Paul, MN 55123 USA David Hanssens, 44 ............... Vice President of Merger Sub since July 2001. Executive Vice President and Thomson Legal and Regulatory Chief Strategy Officer of Thomson Legal and Regulatory from May 2001. Managing 610 Opperman Drive Director of The Parthenon Group in Boston, Massachusetts from 1992 to 2001. St. Paul, MN 55123 USA
1 APPENDIX 2 NEWSEDGE CORPORATION AUDIT COMMITTEE CHARTER A. Purpose and Scope The primary function of the Audit Committee (the "Committee") is to assist the Board of Directors in fulfilling its responsibilities by reviewing: (i) the financial reports provided by NewsEdge to the Securities and Exchange Commission ("SEC"), NewsEdge's shareholders or to the general public, and (ii) NewsEdge's internal financial and accounting controls. B. Composition. The Committee shall be comprised of a minimum of three directors as appointed by the Board of Directors, who shall meet the independence and audit committee composition requirements under any rules or regulations of The NASDAQ National Market, as in effect from time to time, and shall be free from any relationship that, in the opinion of the Board of Directors, would interfere with the exercise of his or her independent judgment as a member of the Committee. All members of the Committee shall either (i) be able to read and understand fundamental financial statements, including a balance sheet, cash flow statement and income statement, or (ii) be able to do so within a reasonable period of time after appointment to the Committee. At least one member of the Committee shall have employment experience in finance or accounting, requisite professional certification in accounting, or other comparable experience or background which results in the individual's financial sophistication, including being or having been a chief executive officer, chief financial officer or other senior officer with financial oversight responsibilities. The Board may appoint one member who does not meet the independence requirements set forth above and who is not a current employee of NewsEdge or an immediate family member of such employee if the Board, under exceptional and limited circumstances, determines that membership on the Committee by the individual is required in the best interests of NewsEdge and its stockholders. The Board shall disclose in the next proxy statement after such determination the nature of the relationship and the reasons for the determination. The members of the Committee shall be elected by the Board of Directors at the meeting of the Board of Directors following each annual meeting of stockholders and shall serve until their successors shall be duly elected and qualified or until their earlier resignation or removal. Unless a Chair is elected by the full Board of Directors, the members of the Committee may designate a Chair by majority vote of the full Committee membership. C. Responsibilities and Duties To fulfill its responsibilities and duties the Committee shall: Document Review 1. Review and assess the adequacy of this Charter periodically as conditions dictate, but at least annually (and update this Charter if and when appropriate). 2. Review with representatives of management and representatives of the independent accounting firm NewsEdge's audited annual financial statements prior to their filing as part of the Annual Report on Form 10-K. After such review and discussion, the Committee shall recommend to the Board of Directors whether such audited financial statements should be published in NewsEdge's annual report on Form 10-K. The Committee shall also review 1 NewsEdge's quarterly financial statements prior to their inclusion in NewsEdge's quarterly SEC filings on Form 10-Q. 3. Take steps designed to insure that the independent accounting firm reviews NewsEdge's interim financial statements prior to their inclusion in NewsEdge's quarterly reports on Form 10-Q. Independent Accounting Firm 4. Recommend to the Board of Directors the selection of the independent accounting firm, and approve the fees and other compensation to be paid to the independent accounting firm. The Committee shall have the ultimate authority and responsibility to select, evaluate and, when warranted, replace such independent accounting firm (or to recommend such replacement for shareholder approval in any proxy statement). 5. On an annual basis, receive from the independent accounting firm a formal written statement identifying all relationships between the independent accounting firm and NewsEdge consistent with Independence Standards Board Standard 1. The Committee shall actively engage in a dialogue with the independent accounting firm as to any disclosed relationships or services that may impact its independence. The Committee shall take, or recommend that the Board of Directors take, appropriate action to oversee the independence of the independent accounting firm. 6. On an annual basis, discuss with representatives of the independent accounting firm the matters required to be discussed by Statement on Auditing Standards 61, as it may be modified or supplemented. 7. Meet with the independent accounting firm prior to the audit to review the planning and staffing of the audit. 8. Evaluate the performance of the independent accounting firm and recommend to the Board of Directors any proposed discharge of the independent accounting firm when circumstances warrant. The independent accounting firm shall be ultimately accountable to the Board of Directors and the Committee. Financial Reporting Process 9. In consultation with the independent accounting firm and management, review annually the adequacy of NewsEdge's internal financial and accounting controls. Compliance 10. To the extent deemed necessary by the Committee, it shall have the authority to engage outside counsel and/or independent accounting consultants to review any matter under its responsibility. Reporting 11. Prepare, in accordance with the rules of the SEC as modified or supplemented from time to time, a written report of the audit committee to be included in NewsEdge's annual proxy statement for each annual meeting of stockholders occurring after December 14, 2000. While the Audit Committee has the responsibilities and powers set forth in this Charter, it is not the duty of the Audit Committee to plan or conduct audits or to determine that NewsEdge's financial statement are complete and accurate and are in accordance with generally accepted accounting principles. 2 ANNEX B BROADVIEW August 6, 2001 CONFIDENTIAL
Board of Directors NewsEdge Corporation 80 Blanchard Road Burlington, Massachusetts 01803 Members of the Board: We understand that NewsEdge Corporation ("NewsEdge" or the "Company"), The Thomson Corporation ("Buyer or the "Parent") and NewsEdge Acquisition Corporation, a wholly-owned subsidiary of Parent ("Merger Sub"), propose to enter into an Agreement and Plan of Merger (the "Agreement") pursuant to which Parent will cause Merger Sub to make a tender offer (the "Offer") to purchase all of the issued and outstanding shares of common stock of News Edge ("NewsEdge Common Stock") at a price per share of $2.30 (the "Offer Price") in cash and subsequently merge with and into the Company (the "Merger"). Pursuant to the Merger, each issued and outstanding share of NewsEdge Common Stock not acquired in the Offer will be converted into the right to receive the highest per share cash consideration paid pursuant to the Offer. The terms and conditions of the above described Offer and Merger (together, the "Transaction") are more fully detailed in the Agreement. You have requested our opinion as to whether the Offer Price is fair, from a financial point of view, to holders of NewsEdge Common Stock. Broadview International LLC ("Broadview") focuses on providing merger and acquisition advisory services to information technology ("IT"), communications and media companies. In this capacity, we are continually engaged in valuing such businesses, and we maintain an extensive database of IT, communications and media mergers and acquisitions for comparative purpose. We are currently acting as financial advisor to NewsEdge's Board of Directors and will receive a fee from NewsEdge upon the delivery of this opinion. In rendering our opinion, we have, among other things: 1) reviewed the terms of the Agreement in the form of the draft dated August 3, 2001, furnished to us by Buyer's legal counsel on August 3, 2001 (which, for the purposes of this opinion, we have assumed, with your permission, to be identical in all material respects to the agreement to be executed); 2) reviewed NewsEdge's annual report on Form 10-K for the fiscal year ended December 31, 2000, including the audited financial statements included therein and NewsEdge's quarterly report on Form 10-Q for the period ended March 31, 2001, including the unaudited financial statements included therein; 3) reviewed certain internal financial and operating information concerning NewsEdge, including unaudited historical quarterly financial statements for the period ended June 30, 2001 and quarterly projections through December 31, 2002, in each case prepared and furnished to us by NewsEdge management; 4) participated in discussions with NewsEdge management concerning the operations, business strategy, current financial performance and prospects for NewsEdge; 5) discussed with NewsEdge management its view of the strategic rationale for the Transaction; B-1 6) reviewed the recently reported closing prices and trading activity for NewsEdge Common Stock; 7) compared certain aspects of the financial performance of NewsEdge with public companies we deemed comparable; 8) analyzed available information, both public and private, concerning other mergers and acquisitions we believed to be comparable in whole or in part to the Transaction; 9) reviewed recent equity analyst reports covering NewsEdge; 10) participated in discussions related to the Transaction among NewsEdge, Buyer and their respective advisors; and 11) conducted other financial studies, analyses and investigations as we deemed appropriate for purposes of this opinion. In rendering our opinion, we have relied without independent verification, on the accuracy and completeness of all the financial and other information (including without limitation the representations and warranties contained in the Agreement) that was publicly available or furnished to us by NewsEdge, Buyer or their respective advisors. With respect to the financial projections examined by us, we have assumed that they were reasonably prepared and reflected the best available estimates and good faith judgments of the management of NewsEdge as to the future performance of NewsEdge. We have neither made nor obtained an independent appraisal or valuation of any of NewsEdge's assets. Based upon and subject to the foregoing and subject to the limitations and assumptions below, we are of the opinion that the Offer Price is fair, from a financial point of view, to holders of NewsEdge Common Stock. For purposes of this opinion, we have assumed that NewsEdge is not currently involved in any material transaction other than the Transaction, other publicly announced transactions and those activities undertaken in the ordinary course of conducting businesses. Our opinion is necessarily based upon market, economic, financial and other conditions as they exist and can be evaluated as of the date of this opinion, and any change in such conditions would require a reevaluation of this opinion. This opinion speaks only as of the date hereof. It is understood that this opinion is for the information of the Board of Directors of NewsEdge in connection with its consideration of the Transaction and does not constitute a recommendation to any NewsEdge stockholder as to whether such stockholder should tender its shares in the Offer or as to how such stockholder should vote with respect to the Merger. This opinion may not be published or referred to, in whole or part, without our prior written permission, which shall not be unreasonably withheld. Broadview hereby consents to references to and the inclusion of its opinion in its entirety in the Solicitation/Recommendation Statement on Schedule 14D-9 and, if required, the Proxy Statement, in each case to be distributed to NewsEdge stockholders in connection with the Transaction. Sincerely, /s/ Broadview International LLC B-2 ANNEX C DELAWARE GENERAL CORPORATION LAW SEC. 262 APPRAISAL RIGHTS. (a) Any stockholder of a corporation of this State who holds shares of stock on the date of the making of a demand pursuant to subsection (d) of this section with respect to such shares, who continuously holds such shares through the effective date of the merger or consolidation, who has otherwise complied with subsection (d) of this section and who has neither voted in favor of the merger or consolidation nor consented thereto in writing pursuant to Section 228 of this title shall be entitled to an appraisal by the Court of Chancery of the fair value of the stockholder's shares of stock under the circumstances described in subsections (b) and (c) of this section. As used in this section, the work "stockholder" means a holder of record of stock in a stock corporation and also a member of record of a nonstock corporation; the words "stock" and "share" mean and include what is ordinarily meant by those words and also membership or membership interest of a member of a nonstock corporation; and the words "depository receipt" mean a receipt or other instrument issued by a depository representing an interest in one or more shares, or fractions thereof, solely of stock of a corporation, which stock is deposited with the depository. (b) Appraisal rights shall be available for the shares of any class or series of stock of a constituent corporation in a merger or consolidation to be effected pursuant to Section 251 (other than a merger effected pursuant to Section 251(g) of this title), Section 252, Section 254, Section 257, Section 258, Section 263 or Section 264 of this title: (1) Provided, however, that no appraisal rights under this section shall be available for the shares of any class or series of stock, which stock, or depository receipts in respect thereof, at the record date fixed to determine the stockholders entitled to receive notice of and to vote at the meeting of stockholders to act upon the agreement of merger or consolidation, were either (i) listed on a national securities exchange or designated as a national market system security on an interdealer quotation system by the National Association of Securities Dealers, Inc. or (ii) held of record by more than 2,000 holders; and further provided that no appraisal rights shall be available for any shares of stock of the constituent corporation surviving a merger if the merger did not require for its approval the vote of the stockholders of the surviving corporation as provided in subsection (f) of Section 251 of this title. (2) Notwithstanding paragraph (1) of this subsection, appraisal rights under this section shall be available for the shares of any class or series of stock of a constituent corporation if the holders thereof are required by the terms of an agreement of merger or consolidation pursuant to Sections 251, 252, 254, 257, 258, 263 and 264 of this title to accept for such stock anything except: a. Shares of stock of the corporation surviving or resulting from such merger or consolidation, or depository receipts in respect thereof; b. Shares of stock of any other corporation, or depository receipts in respect thereof, which shares of stock (or depository receipts in respect thereof) or depository receipts at the effective date of the merger or consolidation will be either listed on a national securities exchange or designated as a national market system security on an interdealer quotation system by the National Association of Securities Dealers, Inc. or held of record by more than 2,000 holders; c. Cash in lieu of fractional shares or fractional depository receipts described in the foregoing subparagraphs a. and b. of this paragraph; or C-1 d. Any combination of the shares of stock, depository receipts and cash in lieu of fractional shares or fractional depository receipts described in the foregoing subparagraphs a., b. and c. of this paragraph. (3) In the event all of the stock of a subsidiary Delaware corporation party to a merger effected under Section 253 of this title is not owned by the parent corporation immediately prior to the merger, appraisal rights shall be available for the shares of the subsidiary Delaware corporation. (c) Any corporation may provide in its certificate of incorporation that appraisal rights under this section shall be available for the shares of any class or series of its stock as a result of an amendment to its certificate of incorporation, any merger or consolidation in which the corporation is a constituent corporation or the sale of all or substantially all of the assets of the corporation. If the certificate of incorporation contains such a provision, the procedures of this section, including those set forth in subsections (d) and (e) of this section, shall apply as nearly as is practicable. (d) Appraisal rights shall be perfected as follows: (1) If a proposed merger or consolidation for which appraisal rights are provided under this section is to be submitted for approval at a meeting of stockholders, the corporation, not less than 20 days prior to the meeting, shall notify each of its stockholders who was such on the record date for such meeting with respect to shares for which appraisal rights are available pursuant to subsection (b) or (c) hereof that appraisal rights are available for any or all of the shares of the constituent corporations, and shall include in such notice a copy of this section. Each stockholder electing to demand the appraisal of such stockholder's shares shall deliver to the corporation, before the taking of the vote on the merger or consolidation, a written demand for appraisal of such stockholder's shares. Such demand will be sufficient if it reasonably informs the corporation of the identity of the stockholder and that the stockholder intends thereby to demand the appraisal of such stockholder's shares. A proxy or vote against the merger or consolidation shall not constitute such a demand. A stockholder electing to take such action must do so by a separate written demand as herein provided. Within 10 days after the effective date of such merger or consolidation, the surviving or resulting corporation shall notify each stockholder of each constituent corporation who has complied with this subsection and has not voted in favor of or consented to the merger or consolidation of the date that the merger or consolidation has become effective; or (2) If the merger or consolidation was approved pursuant to Section 228 or Section 253 of this title, each constituent corporation, either before the effective date of the merger or consolidation or within ten days thereafter, shall notify each of the holders of any class or series of stock of such constituent corporation who are entitled to appraisal rights of the approval of the merger or consolidation and that appraisal rights are available for any or all shares of such class or series of stock of such constituent corporation, and shall include in such notice a copy of this section; provided that, if the notice is given on or after the effective date of the merger or consolidation, such notice shall be given by the surviving or resulting corporation to all such holders of any class or series of stock of a constituent corporation that are entitled to appraisal rights. Such notice may, and, if given on or after the effective date of the merger or consolidation, shall, also notify such stockholders of the effective date of the merger or consolidation. Any stockholder entitled to appraisal rights may, within 20 days after the date of mailing of such notice, demand in writing from the surviving or resulting corporation the appraisal of such holder's shares. Such demand will be sufficient if it reasonably informs the corporation of the identity of the stockholder and that the stockholder intends thereby to demand the appraisal of such holder's shares. If such notice did not notify stockholders of the effective date of the merger or consolidation, either (i) each such constituent corporation shall send a second notice before the C-2 effective date of the merger or consolidation notifying each of the holders of any class or series of stock of such constituent corporation that are entitled to appraisal rights of the effective date of the merger or consolidation or (ii) the surviving or resulting corporation shall send such a second notice to all such holders on or within 10 days after such effective date; provided, however, that if such second notice is sent more than 20 days following the sending of the first notice, such second notice need only be sent to each stockholder who is entitled to appraisal rights and who has demanded appraisal of such holder's shares in accordance with this subsection. An affidavit of the secretary or assistant secretary or of the transfer agent of the corporation that is required to give either notice that such notice has been given shall, in the absence of fraud, be prima facie evidence of the facts stated therein. For purposes of determining the stockholders entitled to receive either notice, each constituent corporation may fix, in advance, a record date that shall be not more than 10 days prior to the date the notice is given, provided, that if the notice is given on or after the effective date of the merger or consolidation, the record date shall be such effective date. If no record date is fixed and the notice is given prior to the effective date, the record date shall be the close of business on the day next preceding the day on which the notice is given. (e) Within 120 days after the effective date of the merger or consolidation, the surviving or resulting corporation or any stockholder who has complied with subsections (a) and (d) hereof and who is otherwise entitled to appraisal rights, may file a petition in the Court of Chancery demanding a determination of the value of the stock of all such stockholders. Notwithstanding the foregoing, at any time within 60 days after the effective date of the merger or consolidation, any stockholder shall have the right to withdraw such stockholder's demand for appraisal and to accept the terms offered upon the merger or consolidation. Within 120 days after the effective date of the merger or consolidation, any stockholder who has complied with the requirements of subsections (a) and (d) hereof, upon written request, shall be entitled to receive from the corporation surviving the merger or resulting from the consolidation a statement setting forth the aggregate number of shares not voted in favor of the merger or consolidation and with respect to which demands for appraisal have been received and the aggregate number of holders of such shares. Such written statement shall be mailed to the stockholder within 10 days after such stockholder's written request for such a statement is received by the surviving or resulting corporation or within 10 days after expiration of the period for delivery of demands for appraisal under subsection (d) hereof, whichever is later. (f) Upon the filing of any such petition by a stockholder, service of a copy thereof shall be made upon the surviving or resulting corporation, which shall within 20 days after such service file in the office of the Register in Chancery in which the petition was filed a duly verified list containing the names and addresses of all stockholders who have demanded payment for their shares and with whom agreements as to the value of their shares have not been reached by the surviving or resulting corporation. If the petition shall be filed by the surviving or resulting corporation, the petition shall be accompanied by such a duly verified list. The Register in Chancery, if so ordered by the Court, shall give notice of the time and place fixed for the hearing of such petition by registered or certified mail to the surviving or resulting corporation and to the stockholders shown on the list at the addresses therein stated. Such notice shall also be given by 1 or more publications at least 1 week before the day of the hearing, in a newspaper of general circulation published in the City of Wilmington, Delaware or such publication as the Court deems advisable. The forms of the notices by mail and by publication shall be approved by the Court, and the costs thereof shall be borne by the surviving or resulting corporation. (g) At the hearing on such petition, the Court shall determine the stockholders who have complied with this section and who have become entitled to appraisal rights. The Court may require the stockholders who have demanded an appraisal for their shares and who hold stock represented by certificates to submit their certificates of stock to the Register in Chancery for notation thereon of the pendency of the appraisal proceedings; and if any stockholder fails to comply with such direction, the Court may dismiss the proceedings as to such stockholder. C-3 (h) After determining the stockholders entitled to an appraisal, the Court shall appraise the shares, determining their fair value exclusive of any element of value arising from the accomplishment or expectation of the merger or consolidation, together with a fair rate of interest, if any, to be paid upon the amount determined to be the fair value. In determining such fair value, the Court shall take into account all relevant factors. In determining the fair rate of interest, the Court may consider all relevant factors, including the rate of interest which the surviving or resulting corporation would have had to pay to borrow money during the pendency of the proceeding. Upon application by the surviving or resulting corporation or by any stockholder entitled to participate in the appraisal proceeding, the Court may, in its discretion, permit discovery or other pretrial proceedings and may proceed to trial upon the appraisal prior to the final determination of the stockholder entitled to an appraisal. Any stockholder whose name appears on the list filed by the surviving or resulting corporation pursuant to subsection (f) of this section and who has submitted such stockholder's certificates of stock to the Register in Chancery, if such is required, may participate fully in all proceedings until it is finally determined that such stockholder not entitled to appraisal rights under this section. (i) The Court shall direct the payment of the fair value of the shares, together with interest, if any, by the surviving or resulting corporation to the stockholders entitled thereto. Interest may be simple or compound, as the Court may direct. Payment shall be so made to each such stockholder, in the case of holders of uncertificated stock forthwith, and the case of holders of shares represented by certificates upon the surrender to the corporation of the certificates representing such stock. The Court's decree may be enforced as other decrees in the Court of Chancery may be enforced, whether such surviving or resulting corporation be a corporation of this State or of any state. (j) The costs of the proceeding may be determined by the Court and taxed upon the parties as the Court deems equitable in the circumstances. Upon application of a stockholder, the Court may order all or a portion of the expenses incurred by any stockholder in connection with the appraisal proceeding, including, without limitation, reasonable attorney's fees and the fees and expenses of experts, to be charged pro rata against the value of all the shares entitled to an appraisal. (k) From and after the effective date of the merger or consolidation, no stockholder who has demanded appraisal rights as provided in subsection (d) of this section shall be entitled to vote such stock for any purpose or to receive payment of dividends or other distributions on the stock (except dividends or other distributions payable to stockholders of record at a date which is prior to the effective date of the merger or consolidation); provided, however, that if no petition for an appraisal shall be filed within the time provided in subsection (e) of this section, or if such stockholder shall deliver to the surviving or resulting corporation a written withdrawal of such stockholder's demand for an appraisal and an acceptance of the merger or consolidation, either within 60 days after the effective date of the merger or consolidation as provided in subsection (e) of this section or thereafter with the written approval of the corporation, then the right of such stockholder to an appraisal shall cease. Notwithstanding the foregoing, no appraisal proceeding in the Court of Chancery shall be dismissed as to any stockholder without the approval of the Court, and such approval may be conditioned upon such terms as the Court deems just. (l) The shares of the surviving or resulting corporation to which the shares of such objecting stockholders would have been converted had they assented to the merger or consolidation shall have the status of authorized and unissued shares of the surviving or resulting corporation. C-4 INDEX TO EXHIBITS Exhibit (a)(1)(i) Offer to Purchase, dated August 21, 2001 (incorporated by reference to Exhibit (a)(1) to the Schedule TO of Merger Sub filed on August 21, 2001). Exhibit (a)(1)(ii) Form of Letter of Transmittal (incorporated by reference to Exhibit (a)(2) to the Schedule TO of Merger Sub filed on August 21, 2001). Exhibit (a)(2)(i) Letter to Stockholders of NewsEdge, dated August 21, 2001.* Exhibit (a)(2)(ii) Fairness Opinion of Broadview International LLC, dated August 6, 2001 (included as Annex B to this Schedule 14D-9).* Exhibit (e)(1) Agreement and Plan of Merger, dated as of August 6, 2001, among NewsEdge, Thomson and Merger Sub. Exhibit (e)(2) Stockholders Agreement among Thomson, Merger Sub and certain stockholders of NewsEdge. Exhibit (e)(3) Confidentiality Agreement, dated May 16, 2001, between Broadview International LLC, on behalf of NewsEdge, and West Group. Exhibit (e)(4) Amended and Restated Executive Employment Agreement dated August 6, 2001 between NewsEdge and Clifford M. Pollan. Exhibit (e)(5) Amended and Restated Executive Employment Agreement dated August 6, 2001 between NewsEdge and Ronald Benanto. Exhibit (e)(6) Amended and Restated Executive Employment Agreement dated August 6, 2001 between NewsEdge and Charles White. Exhibit (e)(7) Amended and Restated Executive Employment Agreement dated August 6, 2001 between NewsEdge and Thomas Karanian. Exhibit (e)(8) Amended and Restated Executive Employment Agreement dated August 6, 2001 between NewsEdge and John Crozier. Exhibit (e)(9) Amended and Restated Executive Employment Agreement dated August 6, 2001 between NewsEdge and David M. Scott. Exhibit (e)(10) Amended and Restated Executive Employment Agreement dated August 6, 2001 between NewsEdge and Alton Zink. Exhibit (e)(11) Amended and Restated Executive Employment Agreement dated August 6, 2001 between NewsEdge and Lee Phillips. Exhibit (e)(12) Information Statement of NewsEdge, dated August 21, 2001 (included as Annex A to this Schedule 14D-9).* ANNEX A Information Statement ANNEX B Fairness Opinion of Broadview ANNEX C Delaware Statute Governing Appraisal
- ------------------------ * Included with the Schedule 14D-9 mailed to stockholders. EX-99.E1 3 a2057464zex-99_e1.txt EXHIBIT 99.E.1 - -------------------------------------------------------------------------------- AGREEMENT AND PLAN OF MERGER AMONG THE THOMSON CORPORATION INFOBLADE ACQUISITION CORPORATION AND NEWSEDGE CORPORATION DATED AS OF AUGUST 6, 2001 - -------------------------------------------------------------------------------- TABLE OF CONTENTS PAGE ---- ARTICLE I DEFINITIONS SECTION 1.01. Definitions.....................................................2 ARTICLE II THE OFFER SECTION 2.01. The Offer.......................................................7 SECTION 2.02. Company Action..................................................9 ARTICLE III THE MERGER SECTION 3.01. The Merger.....................................................10 SECTION 3.02. Effective Time; Closing........................................10 SECTION 3.03. Effect of the Merger...........................................11 SECTION 3.04. Certificate of Incorporation; By-laws..........................11 SECTION 3.05. Directors and Officers.........................................11 SECTION 3.06. Conversion of Securities.......................................12 SECTION 3.07. Employee Stock Options; Employee Stock Purchase Plan...........12 SECTION 3.08. Warrants.......................................................13 SECTION 3.09. Dissenting Shares..............................................13 SECTION 3.10. Surrender of Shares; Stock Transfer Books......................14 ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY SECTION 4.01. Organization and Qualification; Subsidiaries...................16 SECTION 4.02. Certificate of Incorporation and By-laws.......................16 SECTION 4.03. Capitalization.................................................17 SECTION 4.04. Authority Relative to This Agreement...........................18 SECTION 4.05. No Conflict; Required Filings and Consents.....................18 SECTION 4.06. Permits; Compliance............................................19 SECTION 4.07. SEC Filings; Financial Statements..............................20 SECTION 4.08. Absence of Certain Changes or Events...........................21 SECTION 4.09. Absence of Litigation..........................................21 SECTION 4.10. Employee Benefit Plans.........................................21 SECTION 4.11. Labor and Employment Matters...................................24 SECTION 4.12. Offer Documents; Schedule 14D-9; Proxy Statement...............26 SECTION 4.13. Property and Leases............................................26 SECTION 4.14. Intellectual Property..........................................27 SECTION 4.15. Taxes..........................................................30 SECTION 4.16. Environmental Matters..........................................31 SECTION 4.17. Material Contracts.............................................31 SECTION 4.18. Insurance......................................................34 SECTION 4.19. Brokers........................................................34 ARTICLE V REPRESENTATIONS AND WARRANTIES OF PARENT AND PURCHASER SECTION 5.01. Corporate Organization.........................................35 SECTION 5.02 Authority Relative to This Agreement............................35 SECTION 5.03. No Conflict; Required Filings and Consents.....................35 SECTION 5.04. Financing......................................................36 SECTION 5.05. Offer Documents; Proxy Statement...............................36 SECTION 5.06. Brokers........................................................37 SECTION 5.07. Performance....................................................37 SECTION 5.08. Litigation.....................................................37 ARTICLE VI CONDUCT OF BUSINESS PENDING THE MERGER SECTION 6.01. Conduct of Business by the Company Pending the Merger..........37 ARTICLE VII ADDITIONAL AGREEMENTS SECTION 7.01. Stockholders' Meeting..........................................40 SECTION 7.02. Proxy Statement................................................41 SECTION 7.03. Company Board Representation; Section 14(f)....................41 SECTION 7.04. Access to Information; Confidentiality.........................42 SECTION 7.05. No Solicitation of Transactions................................43 SECTION 7.06. Employee Benefits Matters......................................44 SECTION 7.07. Directors' and Officers' Indemnification and Insurance.........44 SECTION 7.08. Notification of Certain Matters................................45 SECTION 7.09. Further Action; Reasonable Best Efforts........................45 SECTION 7.10. Public Announcements...........................................46 ARTICLE VIII CONDITIONS TO THE MERGER SECTION 8.01. Conditions to the Merger.......................................46 ARTICLE IX TERMINATION, AMENDMENT AND WAIVER SECTION 9.01. Termination....................................................47 SECTION 9.02. Effect of Termination..........................................48 SECTION 9.03 Fees and Expenses...............................................48 SECTION 9.04. Amendment......................................................50 SECTION 9.05. Waiver.........................................................50 ARTICLE X GENERAL PROVISIONS SECTION 10.01 Notices........................................................50 SECTION 10.02. Severability..................................................51 SECTION 10.03. Entire Agreement; Assignment..................................52 SECTION 10.04. Parties in Interest...........................................52 SECTION 10.05. Specific Performance..........................................52 SECTION 10.06. Governing Law.................................................52 SECTION 10.07. Waiver of Jury Trial..........................................52 SECTION 10.08. Headings......................................................53 SECTION 10.09. Counterparts..................................................53 ANNEX A - CONDITIONS TO THE OFFER SCHEDULES SCHEDULE I - SELLING STOCKHOLDERS SCHEDULE II - OFFICERS EXHIBIT A - AMENDED EMPLOYMENT AGREEMENTS DISCLOSURE SCHEDULE AGREEMENT AND PLAN OF MERGER, dated as of August 6, 2001 (this "Agreement"), among THE THOMSON CORPORATION, a corporation incorporated under the laws of the Province of Ontario (the "Parent"), INFOBLADE ACQUISITION CORPORATION, a Delaware corporation and an indirect wholly owned subsidiary of Parent ("Purchaser"), and NEWSEDGE CORPORATION, a Delaware corporation (the "Company"). WHEREAS, the Parent and the respective Boards of Directors of Purchaser and the Company have each determined that it is in the best interests of their respective stockholders for Parent to acquire the Company upon the terms and subject to the conditions set forth herein; WHEREAS, in furtherance of such acquisition, it is proposed that Purchaser shall make a cash tender offer (the "Offer") to acquire all the shares of common stock, par value $0.01 per share, of the Company ("Shares") that are issued and outstanding for $2.30 per Share (such amount, or any greater amount per Share paid pursuant to the Offer, being the "Per Share Amount"), net to the seller in cash, upon the terms and subject to the conditions of this Agreement and the Offer; WHEREAS, the Board of Directors of the Company (the "Board") has unanimously approved the making of the Offer and resolved to recommend that holders of Shares tender their Shares pursuant to the Offer; WHEREAS, also in furtherance of such acquisition, the Boards of Directors of Purchaser and the Company have each approved this Agreement and declared its advisability and approved the merger (the "Merger") of Purchaser with and into the Company in accordance with the General Corporation Law of the State of Delaware ("Delaware Law"), following the consummation of the Offer and upon the terms and subject to the conditions set forth herein; WHEREAS, Parent, Purchaser and certain of the stockholders of the Company set forth in Schedule I hereto (the "Selling Stockholders") have entered into stockholder agreements, dated as of the date hereof (the "Stockholder Agreement"), providing that, among other things, such Selling Stockholders shall (i) tender their Shares into the Offer and (ii) vote their Shares in favor of the Merger and, if applicable, in each case on the terms and subject to the conditions set forth therein; and WHEREAS, the Company and each of the officers of the Company set forth in Schedule II hereto (the "Officers") have entered into an amended and restated employment agreement dated as of the date hereof and in the form of Exhibit A hereto (the "Amended Employment Agreements"). NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements herein contained, and intending to be legally bound hereby, Parent, Purchaser and the Company hereby agree as follows: ARTICLE I DEFINITIONS SECTION 1.01. DEFINITIONS. (a) For purposes of this Agreement: "ACQUISITION PROPOSAL" means (i) any proposal or offer from any person other than Parent or Purchaser regarding any direct or indirect acquisition of (A) all or a substantial part of the assets of the Company or of any Subsidiary or (B) over 15% of any class of equity securities of the Company or of any Subsidiary; (ii) any tender offer or exchange offer, as defined pursuant to the Exchange Act, that, if consummated, would result in any person beneficially owning 15% or more of any class of equity securities of the Company or any Subsidiary; or (iii) any proposal or offer from any person other than Parent or Purchaser regarding any merger, consolidation, business combination, sale of all or a substantial part of the assets, recapitalization, liquidation, dissolution or similar transaction involving the Company or any Subsidiary, other than the Transactions. "AFFILIATE" of a specified person means a person who, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, such specified person. "BENEFICIAL OWNER", with respect to any Shares, means a person who shall be deemed to be the beneficial owner of such Shares (i) which such person or any of its affiliates or associates (as such term is defined in Rule 12b-2 promulgated under the Exchange Act) beneficially owns, directly or indirectly, (ii) which such person or any of its affiliates or associates has, directly or indirectly, (A) the right to acquire (whether such right is exercisable immediately or subject to the passage of time or other conditions), pursuant to any agreement, arrangement or understanding or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise, or (B) the right to vote pursuant to any agreement, arrangement or understanding or (iii) which are beneficially owned, directly or indirectly, by any other persons with whom such person or any of its affiliates or associates or person with whom such person or any of its affiliates or associates has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of any Shares. "BROADVIEW" means Broadview International, LLC. 2 "BUSINESS DAY" means any day on which banks are not required or authorized to close in the City of New York. "COMPANY INDEBTEDNESS" shall mean all obligations and liabilities created, issued or incurred by the Company or any Subsidiary for borrowed money (excluding any trade payable incurred in the ordinary course of business and consistent with past practice) or long-term debt, including without limitation, bank loans, mortgages, notes payable, purchase money installment debt, capital lease obligations, guarantees of indebtedness of others, loans from stockholders or other affiliates of the Company or any Subsidiary (excluding any expense reimbursement owed to employees of the Company as a result of travel and other activities in the ordinary course of business and consistent with past practice), and all principal, interest, fees, prepayment penalties or amounts due or owing with respect thereto. "CONTROL" (including the terms "controlled by" and "under common control with") means the possession, directly or indirectly, or as trustee or executor, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, as trustee or executor, by contract or credit arrangement or otherwise. "ENVIRONMENTAL LAWS" means any Laws relating to (i) releases or threatened releases of Hazardous Substances or materials containing Hazardous Substances; (ii) the manufacture, handling, transport, use, treatment, storage or disposal of Hazardous Substances or materials containing Hazardous Substances; or (iii) pollution or protection of the environment, health, safety or natural resources. "HAZARDOUS SUBSTANCES" means (i) those substances defined in or regulated under the following United States federal Laws and their state counterparts, as each may be amended from time to time, and all regulations thereunder: the Hazardous Materials Transportation Act, the Resource Conservation and Recovery Act, the Comprehensive Environmental Response, Compensation and Liability Act, the Clean Water Act, the Safe Drinking Water Act, the Atomic Energy Act, the Federal Insecticide, Fungicide, and Rodenticide Act and the Clean Air Act; (ii) petroleum and petroleum products, including crude oil and any fractions thereof; (iii) natural gas, synthetic gas, and any mixtures thereof; (iv) polychlorinated biphenyls, asbestos or asbestos containing materials, lead and lead-based paint; (v) any other contaminant; and (vi) any substance, material or waste regulated by any Governmental Authority pursuant to any Environmental Law. "INTELLECTUAL PROPERTY" means (i) United States, non-United States, and international patents, patent applications and statutory invention registrations, (ii) trademarks, service marks, trade dress, logos, trade names, corporate names and other 3 source identifiers, and registrations and applications for registration thereof, (iii) copyrightable works, copyrights, and registrations and applications for registration thereof, (iv) confidential and proprietary information, including trade secrets, technical information and know-how, (v) Software, (vi) domain names, URLs, world wide web pages, internet and intranet sites (including all content thereof), together with member or user lists and information associated therewith, and (vii) customer lists, confidential marketing and customer information. "KNOWLEDGE OF THE COMPANY" means the knowledge of any of the Officers. "MATERIAL ADVERSE EFFECT" means, when used in connection with the Company or any Subsidiary, any event, circumstance, change or effect that is or is reasonably likely to be materially adverse to the business, prospects, financial condition or results of operations of the Company and the Subsidiaries, taken as a whole (it being understood, that (i) the Company's receipt of notification from the Nasdaq - AMEX Market Group of the Company's pending delisting from the Nasdaq National Market or the Company's actual delisting from the Nasdaq National Market will not, in either case constitute a Material Adverse Effect, (ii) any adverse effect that is caused by conditions affecting the economy or securities markets generally shall not be taken into account in determining whether there has been a Material Adverse Effect, (iii) any adverse effect that is caused by conditions affecting the primary industry in which the Company currently competes shall not be taken into account in determining whether there has been a Material Adverse Effect (provided that such effect does not affect the Company in a disproportionate manner), (iv) any adverse effect resulting from the Offer, the Merger or any of the Transactions or the announcement thereof and (v) any adverse effect to the extent attributable to the Action (as defined in Section 4.09) set forth as item 1 in Section 4.09 of the Disclosure Schedule, shall not be taken into account in determining whether there has been a Material Adverse Effect). "PERSON" means an individual, corporation, partnership, limited partnership, limited liability company, syndicate, person (including, without limitation, a "person" as defined in Section 13(d)(3) of the Exchange Act), trust, association or entity or government, political subdivision, agency or instrumentality of a government. "SOFTWARE" means computer software, programs and databases in any form, including source code, object code, operating systems and specifications, data, databases, database management code, utilities, graphical user interfaces, menus, images, icons, forms, methods of processing, software engines, platforms, and data formats, all versions, updates, corrections, enhancements, and modifications thereof, and all related documentation, developer notes, comments and annotations. 4 "SUBSIDIARY" OR "SUBSIDIARIES" of the Company means any affiliate controlled by the Company, directly or indirectly, through one or more intermediaries. "SUPERIOR PROPOSAL" means any Acquisition Proposal not solicited, initiated or encouraged in violation of Section 7.05(a) made by a third person on terms which, the Board determines, in its good faith judgment, after having received the advice of Broadview or another financial advisor of nationally recognized reputation after taking into account all of the terms and conditions of such Acquisition Proposal and the ability of the third person making such Acquisition Proposal to consummate it, that the proposed transaction would be more favorable from a financial point of view to the stockholders of the Company than the Offer and the Merger and the Transactions. "TAXES" shall mean any and all taxes, fees, levies, duties, tariffs, imposts and other charges of any kind (together with any and all interest, penalties, additions to tax and additional amounts imposed with respect thereto) imposed by any Governmental Authority or taxing authority, including, without limitation: taxes or other charges on or with respect to income, franchise, windfall or other profits, gross receipts, property, sales, use, capital stock, payroll, employment, social security, workers' compensation, unemployment compensation or net worth; taxes or other charges in the nature of excise, withholding, ad valorem, stamp, transfer, value-added or gains taxes; license, registration and documentation fees; and customers' duties, tariffs and similar charges. (b) The following terms have the meaning set forth in the Sections set forth below: Defined Term Location of Definition ------------ ---------------------- Action 4.09 Agreement Preamble Amended Employment Agreements Recitals Blue Sky Laws 4.05(b) Board Recitals Certificate of Merger 3.02 Certificates 3.10(b) Code 4.10(a) Company Preamble Company Licensed Intellectual Property 4.14(a) Company Owned Intellectual Property 4.14(a) Company Preferred Stock 4.03 Company Stock Option Plans 3.07(a) Confidentiality Agreement 7.04(b) Delaware Law Recitals Disclosure Schedule Article IV 5 Defined Term Location of Definition ------------ ---------------------- Dissenting Shares 3.09(a) Effective Time 3.02 Environmental Permits 4.16 ERISA 4.10(a) ESPP 3.07(b) ESPP Date 3.07(b) Exchange Act 2.01(a) Fee 9.03(a) GAAP 4.07(b) Governmental Authority 4.05(b) IRS 4.10(a) June 30 Financials 4.07(b) Law 4.05(a) Liens 4.13(b) Material Contracts 4.17(a) Merger Recitals Merger Consideration 2.01(a) Minimum Condition 2.01(a) Multiemployer Plan 4.10(b) Multiple Employer Plan 4.10(b) Non-U.S. Benefit Plan 4.10(h) Number of Optioned Shares 3.07(b) Offer Recitals Offer Documents 2.01(b) Offer to Purchase 2.01(b) Officers Recitals Option 3.07(a) Parent Preamble Paying Agent 3.10(a) Payment Fund 3.10(a) Permits 4.06 Permitted Investments 3.10(a) Permitted Liens 4.13(b) Per Share Amount Recitals Plans 4.10(a) Proxy Statement 4.12 Purchaser Preamble Schedule14D-9 2.02(b) Schedule TO 2.01(b) SEC 2.01(a) SEC Reports 4.07(a) Securities Act 4.07(a) Selling Stockholders Recitals 6 Defined Term Location of Definition ------------ ---------------------- Shares Recitals Standard Form Confidentiality Agreement 4.11(d) Stockholder Agreement Recitals Stockholders' Meeting 7.01(a) Surviving Corporation 3.03 Transactions 2.02(a) Warrants 4.03 2000 Balance Sheet 4.07(c) ARTICLE II THE OFFER SECTION 2.01. THE OFFER. (a) Provided that none of the events set forth in paragraphs (d)(ii) and (h) of Annex A shall have occurred, Purchaser shall commence (within the meaning of Rule 14d-2 under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) the Offer as promptly as reasonably practicable after the date hereof but in no event later than ten (10) Business Days after the public announcement (on the date hereof or the following Business Day) of the execution of this Agreement. The obligation of Purchaser to accept for payment Shares tendered pursuant to the Offer shall be subject only to (i) the condition (the "Minimum Condition") that at least the number of Shares that shall constitute a majority of the then outstanding Shares on a fully diluted basis (including, without limitation, all Shares issuable upon the conversion of any convertible securities or upon the exercise of any options, warrants or rights, but excluding Options and Warrants owned by the Selling Stockholders) shall have been validly tendered and not withdrawn prior to the expiration of the Offer and (ii) the satisfaction of each of the other conditions set forth in Annex A hereto. Purchaser expressly reserves the right to waive any such condition (other than the Minimum Condition), to increase the price per Share payable in the Offer, and to make any other amendments or changes in the terms and conditions of the Offer; provided, however, that no amendment or change may be made which decreases the price per Share payable in the Offer, which reduces the maximum number of Shares to be purchased in the Offer or which imposes conditions to the Offer in addition to those set forth in Annex A hereto. Notwithstanding the foregoing, Purchaser may, without the consent of the Company, (i) extend the Offer beyond the initial scheduled expiration date, which shall be 20 Business Days following the commencement of the Offer or any extended expiration date of the Offer, if, at the initial scheduled expiration of the Offer or any extended expiration date of the Offer, any of the conditions to Purchaser's obligation to accept for payment Shares, shall not be satisfied or waived until such time as such conditions are satisfied or waived; provided that Purchaser shall only be permitted three (3) extensions of the Offer pursuant to this clause (i) for periods of up to five (5) Business Days for each such extension, it 7 being understood that if the conditions to Purchaser's obligations to accept for payment Shares are satisfied or waived during an extension, no further extensions pursuant to this clause (i) shall be permitted or (ii) extend the Offer for any period required by any rule, regulation or interpretation of the Securities and Exchange Commission (the "SEC"), or the staff thereof, applicable to the Offer. The Per Share Amount shall, subject to applicable withholding of taxes, be net to the seller in cash, upon the terms and subject to the conditions of the Offer. Subject to the terms of the Offer and this Agreement and the satisfaction (or waiver to the extent permitted by this Agreement) of the conditions to the Offer, Purchaser shall accept for payment all Shares validly tendered and not withdrawn pursuant to the Offer as soon as practicable after the applicable expiration date of the Offer and Purchaser shall pay for all Shares validly tendered and not withdrawn promptly following the acceptance of Shares for payment pursuant to the Offer. Notwithstanding the immediately preceding sentence and subject to the applicable rules of the SEC and the terms and conditions of the Offer, Purchaser expressly reserves the right to delay payment for Shares in order to comply in whole or in part with applicable laws. Any such delay shall be effected in compliance with Rule 14e-1(c) under the Exchange Act. If the payment equal to the Per Share Amount in cash (the "Merger Consideration") is to be made to a person other than the person in whose name the surrendered certificate formerly evidencing Shares is registered on the stock transfer books of the Company, it shall be a condition of payment that the certificate so surrendered shall be endorsed properly or otherwise be in proper form for transfer and that the person requesting such payment shall have paid all transfer and other taxes required by reason of the payment of the Merger Consideration to a person other than the registered holder of the certificate surrendered, or shall have established to the satisfaction of Purchaser that such taxes either have been paid or are not applicable. Purchaser may, in its sole discretion, provide a "subsequent offering period" as contemplated by Rule 14d-11 under the Exchange Act following acceptance for payment of Shares in the Offer. Parent shall provide or cause to be provided to Purchaser on a timely basis the funds necessary to accept for payment, and pay for, any Shares that Purchaser becomes obligated to accept for payment and pay for, pursuant to the Offer. (b) As promptly as reasonably practicable on the date of commencement of the Offer, Parent and Purchaser shall (i) file with the SEC a Tender Offer Statement on Schedule TO (together with all amendments and supplements thereto, the "Schedule TO") with respect to the Offer which shall contain or shall incorporate by reference an offer to purchase (the "Offer to Purchase") and forms of the related letter of transmittal and any related summary advertisement (the Schedule TO, the Offer to Purchase and such other documents, together with all supplements and amendments thereto, being referred to herein collectively as the "Offer Documents"), (ii) deliver a copy of the Schedule TO to the Company at its principal executive office, (iii) give telephonic notice and mail to the National Association of Securities Dealers, Inc. (the "NASD") a copy of the Schedule TO in accordance with Rule 14d-3 promulgated under the Exchange Act, and (iv) mail the Offer Documents to the holders of Shares. Parent, Purchaser and the Company agree to correct promptly any information provided by any of them for use in the Offer Documents that shall have become false or misleading, and 8 Parent and Purchaser further agree to take all steps necessary to cause the Schedule TO, as so corrected, to be filed with the SEC, and the other Offer Documents, as so corrected, to be disseminated to holders of Shares, in each case as and to the extent required by applicable federal securities laws. Parent and Purchaser shall give the Company and its counsel a reasonable opportunity to review and comment on the Schedule TO prior to the filing thereof with the SEC or its dissemination to the Company's stockholders. Parent and Purchaser shall provide the Company and its counsel with any comments, written or oral, Parent or Purchaser or their counsel may receive from the SEC or its staff with respect to the Offer Documents promptly after the receipt of such comments and any written responses thereto. (c) In the event the Agreement has been terminated pursuant to Section 9.01, Purchaser will terminate the Offer (in accordance with all applicable laws) without accepting any Shares for payment. SECTION 2.02. COMPANY ACTION. (a) The Company hereby approves of and consents to the Offer and represents that (i) the Board, at a meeting duly called and held on August 6, 2001, has unanimously (A) determined that this Agreement and the transactions contemplated hereby, including each of the Offer and the Merger, and the transactions contemplated by the Stockholder Agreement (collectively, the "Transactions"), are fair to, and in the best interests of, the holders of Shares, (B) approved, adopted and declared advisable this Agreement and the Transactions (such approval and adoption having been made in accordance with Delaware Law including, without limitation, Section 203 thereof and (C) resolved to recommend that the holders of Shares accept the Offer and tender their Shares pursuant to the Offer, and approve and adopt this Agreement, and (ii) Broadview has delivered to the Board a written opinion that the consideration to be received by the holders of Shares pursuant to each of the Offer and the Merger is fair to the holders of Shares from a financial point of view. The Company hereby consents to the inclusion in the Offer Documents of the recommendation of the Board described in the immediately preceding sentence, and the Company shall not withhold, withdraw, amend, change or modify such recommendation in any manner adverse to Purchaser or Parent except as provided in Section 7.05(b). The Company has been advised by the Selling Stockholders that they intend to tender all Shares beneficially owned by them to Purchaser pursuant to the Offer and to vote the Shares held by them in favor of the approval and adoption of this Agreement pursuant to their Stockholder Agreement. (b) As promptly as reasonably practicable on the date of commencement of the Offer, the Company shall file with the SEC a Solicitation/Recommendation Statement on Schedule 14D-9 (together with all amendments and supplements thereto, the "Schedule 14D-9") containing, except as provided in Section 7.05(b), the recommendation of the Board described in Section 2.02(a), and shall disseminate the Schedule 14D-9 to the extent required by Rule 14d-9 promulgated under the Exchange Act, and any other applicable federal securities laws. 9 The Company, Parent and Purchaser agree to correct promptly any information provided by any of them for use in the Schedule 14D-9 which shall have become false or misleading, and the Company further agrees to take all steps necessary to cause the Schedule 14D-9, as so corrected, to be filed with the SEC and disseminated to holders of Shares, in each case as and to the extent required by applicable federal securities laws. The Company shall give Parent and its counsel a reasonable opportunity to review and comment on the Schedule 14D-9 prior to filing thereof with the SEC or its dissemination to the Company's stockholders. The Company shall provide Parent, Purchaser and their counsel with any comments, written or oral, the Company or its counsel may receive from the SEC or its staff with respect to the Schedule 14D-9 promptly after the receipt of such comments and any written responses thereto. (c) The Company shall promptly furnish or cause to be furnished to Purchaser mailing labels containing the names and addresses of all record holders of Shares and with security position listings of Shares held in stock depositories, each as of a recent date, together with all other available listings and computer files containing names, addresses and security position listings of record holders and beneficial owners of Shares as Purchaser or its agents may request in disseminating the Offer Documents to the Company's stockholders. The Company shall promptly furnish or cause to be furnished to Purchaser such additional information, including, without limitation, updated listings and computer files of stockholders, mailing labels and security position listings, and such other assistance in disseminating the Offer Documents to holders of Shares as Parent or Purchaser may reasonably request. Subject to the requirements of applicable law, and except for such steps as are necessary to disseminate the Offer Documents and any other documents necessary to consummate the Offer or the Merger, Parent and Purchaser shall hold in confidence the information contained in such labels, listings and files, shall use such information only in connection with the Transactions, and, if this Agreement shall be terminated in accordance with Section 9.01, shall deliver or cause to be delivered to the Company all copies of such information then in their possession. ARTICLE III THE MERGER SECTION 3.01. THE MERGER. Upon the terms and subject to the conditions set forth in Article VIII, and in accordance with Delaware Law, at the Effective Time, Purchaser shall be merged with and into the Company. SECTION 3.02. EFFECTIVE TIME; CLOSING. Subject to the terms and conditions of this Agreement as promptly as practicable after the satisfaction or, if permissible, waiver of the conditions set forth in Article VIII, the parties hereto shall cause the Merger to be consummated by filing a certificate of merger (the "Certificate of Merger") with the Secretary of State of the State of Delaware in such form as is required by, and executed in accordance with, the relevant provisions of Delaware Law (the date 10 and time of such filing being the "Effective Time"). Prior to such filing, a closing shall be held at the offices of Torys, 237 Park Avenue, New York, New York 10017, or such other place as the parties shall agree, for the purpose of confirming the satisfaction or waiver, as the case may be, of the conditions set forth in Article VIII. SECTION 3.03. EFFECT OF THE MERGER. As a result of the Merger, the separate corporate existence of Purchaser shall cease and the Company shall continue as the surviving corporation of the Merger (the "Surviving Corporation"). At the Effective Time, the effect of the Merger shall be as provided in the applicable provisions of Delaware Law. Without limiting the generality of the foregoing, and subject thereto, at the Effective Time, all the property, rights, privileges, powers and franchises of the Company and Purchaser shall vest in the Surviving Corporation, and all debts, liabilities, obligations, restrictions, disabilities and duties of the Company and Purchaser shall become the debts, liabilities, obligations, restrictions, disabilities and duties of the Surviving Corporation. SECTION 3.04. CERTIFICATE OF INCORPORATION; BY-LAWS. (a) At the Effective Time, subject to Section 7.07(a), the Certificate of Incorporation of Purchaser, as in effect immediately prior to the Effective Time, shall be the Certificate of Incorporation of the Surviving Corporation until thereafter amended as provided by law and such Certificate of Incorporation; provided, however, that, at the Effective Time, Article I of the Certificate of Incorporation of the Surviving Corporation shall be amended to read as follows: "The name of the corporation is NewsEdge Corporation." (b) Unless otherwise determined by Parent prior to the Effective Time, and subject to Section 7.07(a), the By-laws of Purchaser, as in effect immediately prior to the Effective Time, shall be the By-laws of the Surviving Corporation until thereafter amended as provided by law, the Certificate of Incorporation of the Surviving Corporation and such By-laws. SECTION 3.05. DIRECTORS AND OFFICERS. The directors of Purchaser immediately prior to the Effective Time shall be the initial directors of the Surviving Corporation, each to hold office in accordance with the Certificate of Incorporation and By-laws of the Surviving Corporation, and the officers of Purchaser immediately prior to the Effective Time (which shall include the officers of the Company immediately prior to the Effective Time) shall be the initial officers of the Surviving Corporation, in each case until their respective successors are duly elected or appointed and qualified or until their earlier death, resignation or removal. SECTION 3.06. CONVERSION OF SECURITIES. At the Effective Time, by virtue of the Merger and without any action on the part of Purchaser, the Company or the holders of any of the following securities: 11 (a) Each Share issued and outstanding immediately prior to the Effective Time (other than any Shares to be canceled pursuant to Section 3.06(b) and any Dissenting Shares (as hereinafter defined)) shall be canceled and shall be converted automatically into the right to receive an amount equal to the Merger Consideration payable, without interest, to the holder of such Share, upon surrender, in the manner provided in Section 3.10, of the certificate that formerly evidenced such Share (or in the case of a lost, stolen or destroyed Certificate, upon delivery of an affidavit (and bond, if required) in the manner provided in Section 3.10(c)); (b) Each Share held in the treasury of the Company and each Share owned by Purchaser, Parent or any direct or indirect wholly owned subsidiary of Parent or of the Company immediately prior to the Effective Time shall be canceled without any conversion thereof and no payment or distribution shall be made with respect thereto; and (c) Each share of common stock, par value $0.01 per share, of Purchaser issued and outstanding immediately prior to the Effective Time shall be converted into and exchanged for one validly issued, fully paid and nonassessable share of common stock, par value $0.01 per share, of the Surviving Corporation. SECTION 3.07. EMPLOYEE STOCK OPTIONS; EMPLOYEE STOCK PURCHASE PLAN. (a) Effective as of the Effective Time, the Company shall (i) terminate the Company's Amended and Restated 1989 Stock Option Plan, 1995 Stock Plan, 1995 Non-Employee Director Stock Option Plan, 2000 Non-Officer and Non-Director Stock Plan and Individual, Inc.'s 1996 Non-Employee Director Stock Option Plan (the "1996 Option Plan"), each as amended through the date of this Agreement (the "Company Stock Option Plans"), and (ii) cancel, at the Effective Time, each outstanding option to purchase Shares granted under the Company Stock Option Plans (each, an "Option") that is outstanding and unexercised as of such date. Each holder of an Option that is outstanding and unexercised at the Effective Time shall be entitled, to the extent any such option is exercisable, to receive from the Surviving Corporation immediately after the Effective Time, in exchange for the cancellation of such Option, an amount in cash equal to the excess, if any, of (x) the Per Share Amount over (y) the per share exercise price of such Option, multiplied by the number of Shares subject to such Option as of the Effective Time. From and after the date of this Agreement, the Company shall not accelerate or permit the acceleration of the vesting or exercisability of any Options, other than with respect to certain Options that will vest upon the closing of the Offer and solely to the extent expressly set forth in Section 4.03 of the Disclosure Schedule. Any such payment shall be subject to all applicable federal, state and local tax withholding requirements. (b) As of the last day of the payroll period immediately preceding the Effective Time (the "ESPP Date"), all offering and purchase periods under way under the Company's Employee Stock Purchase Plan (the "ESPP"), shall be terminated and, as of the date of this Agreement, no new offering or purchase periods shall be commenced. The Company shall take all necessary action, including providing all required notices to participants, to ensure that the rights of participants in the ESPP with respect to any such 12 offering or purchase periods shall be determined by treating the ESPP Date as the last day of such offering and purchase periods. The Company shall take all actions as may be necessary in order to freeze the rights of the participants in the ESPP, effective as of the date of this Agreement, to existing participants and, to the extent permissible under the ESPP, existing participation levels. At the ESPP Date, the Company shall terminate the ESPP and each participant's rights thereunder shall terminate in exchange for a cash payment equal to the excess of (i) the Per Share Amount multiplied by the number of Shares that the participant's accumulated payroll deductions as of the ESPP Date could purchase, at the option price under the ESPP, determined with reference only to March 1, 2001 and subject to the limitations set forth in the ESPP (the "Number of Optioned Shares"), over (ii) the result of multiplying the Number of Optioned Shares by such option price, subject to any applicable federal, state and local tax withholding requirements. SECTION 3.08. WARRANTS. At the Effective Time, the holder of each Warrant (each as defined in Section 4.03) shall be entitled to receive, and shall, upon surrender of such Warrant to Purchaser for cancellation, receive, in settlement and cancellation thereof, an amount of cash, if any, equal to the excess, if any, of (x) the Per Share Amount multiplied by the number of Shares issuable upon exercise of such Warrant if such Warrant were exercised immediately prior to the Effective Time with respect to all Shares remaining to be exercised thereunder over (y) the exercise price of each such Warrant with respect to all Shares remaining to be exercised thereunder, which payment shall be made to each such Warrant holder as soon as practicable after the Effective Time. The Company shall take all necessary action, including, without limitation, providing notice to each holder of a Warrant, as required under and in accordance with the terms of such Warrant, to effect the disposition of the Warrants as contemplated by this Section 3.08 and the terms of such Warrant. Upon surrender of such Warrants by the holders thereof, any Warrant not surrendered for cancellation as provided above shall survive the Merger and shall become a warrant to receive, upon payment of the exercise price provided for therein, an amount of cash based on the Per Share Amount in accordance with the merger adjustment provisions of each such Warrant. SECTION 3.09. DISSENTING SHARES. (a) Notwithstanding any provision of this Agreement to the contrary, Shares that are outstanding immediately prior to the Effective Time and that are held by stockholders who shall have not voted in favor of the Merger and who shall have demanded properly in writing appraisal for such Shares in accordance with Section 262 of Delaware Law (collectively, the "Dissenting Shares") shall not be converted into, or represent the right to receive, the Merger Consideration. Such stockholders shall be entitled to receive payment of the appraised value of such Shares held by them in accordance with the provisions of such Section 262, except that all Dissenting Shares held by stockholders who shall have failed to perfect or who effectively shall have withdrawn or lost their rights to appraisal of such Shares under such Section 262 shall thereupon be deemed to have been converted into, and to have become exchangeable for, as of the Effective Time, the right to receive the Merger 13 Consideration, without any interest thereon, upon surrender, in the manner provided in Section 3.10, of the certificate or certificates that formerly evidenced such Shares. (b) The Company shall give Parent (i) prompt notice of any demands for appraisal received by the Company, withdrawals of such demands, and any other instruments served pursuant to Delaware Law and received by the Company and (ii) the opportunity to direct all negotiations and proceedings with respect to demands for appraisal under Delaware Law. The Company shall not, except with the prior written consent of Parent, make any payment with respect to any demands for appraisal or offer to settle or settle any such demands. SECTION 3.10. SURRENDER OF SHARES; STOCK TRANSFER BOOKS. (a) Prior to the Effective Time, Purchaser shall designate a bank or trust company to act as agent (the "Paying Agent") for the holders of Shares to receive the funds to which holders of Shares shall become entitled pursuant to Section 3.06(a). Purchaser shall deposit or shall cause to be deposited with the Paying Agent in a separate fund established for the benefit of the holders of Shares, for payment in accordance with this Article III, through the Paying Agent (the "Payment Fund"), immediately available funds in amounts necessary to make the payments pursuant to Section 3.06(a) to holders of Shares (other than the Company or any Subsidiary or Parent, Purchaser or any other subsidiary of Parent, or holders of Dissenting Shares). The Paying Agent shall, pursuant to irrevocable instructions, pay the Merger Consideration out of the Payment Fund. The Paying Agent shall invest portions of the Payment Fund as Parent directs in obligations of or guaranteed by the United States of America, in commercial paper obligations receiving the highest investment grade rating from both Moody's Investors Services, Inc. and Standard & Poor's Corporation, or in certificates of deposit, bank repurchase agreements or banker's acceptances of commercial banks with capital exceeding $1,000,000,000 (collectively, "Permitted Investments"); provided, however, that the maturities of Permitted Investments shall be such as to permit the Paying Agent to make prompt payment to former holders of the Shares entitled thereto as contemplated by this Section. All earnings on Permitted Investments shall be the sole and exclusive property of Parent and no part of the earnings shall accrue to the benefit of holders of Shares. If for any reason the Payment Fund is inadequate to pay the amounts to which holders of Shares shall be entitled, Parent and the Surviving Corporation shall in any event be liable for payment thereof. The Payment Fund shall not be used for any purpose except as expressly provided in this Agreement. (b) Promptly after the Effective Time, the Surviving Corporation shall cause to be mailed to each person who was, at the Effective Time, a holder of record of Shares entitled to receive the Merger Consideration pursuant to Section 3.06(a) a form of letter of transmittal (which shall specify that delivery shall be effected, and risk of loss and title to the certificates evidencing such Shares (the "Certificates") shall pass, only upon proper delivery of the Certificates to the Paying Agent) and instructions for use in effecting the surrender of the Certificates pursuant to such letter of transmittal. Upon 14 surrender to the Paying Agent of a Certificate, together with such letter of transmittal, duly completed and validly executed in accordance with the instructions thereto, and such other documents as may be required pursuant to such instructions, the holder of such Certificate shall be entitled to receive in exchange therefor the Merger Consideration for each Share formerly evidenced by such Certificate, and such Certificate shall then be canceled. No interest shall accrue or be paid on the Merger Consideration payable upon the surrender of any Certificate for the benefit of the holder of such Certificate. If the payment equal to the Merger Consideration is to be made to a person other than the person in whose name the surrendered certificate formerly evidencing Shares is registered on the stock transfer books of the Company, it shall be a condition of payment that the Certificate so surrendered shall be endorsed properly or otherwise be in proper form for transfer and that the person requesting such payment shall have paid all transfer and other taxes required by reason of the payment of the Merger Consideration to a person other than the registered holder of the certificate surrendered, or shall have established to the reasonable satisfaction of Purchaser that such taxes either have been paid or are not applicable. (c) In the event that any Certificates shall have been lost, stolen or destroyed, the Paying Agent shall issue in exchange for such lost, stolen or destroyed Certificates, upon the making of an affidavit of that fact by the holder thereof, the cash consideration payable with respect thereto pursuant to Section 3.06; provided, however, that Parent may, in its reasonable discretion and as a condition precedent to the issuance of such cash, require the owner of such lost, stolen or destroyed Certificates to deliver a bond in such sum as it may reasonably direct as indemnity against any claim that may be made against Parent, the Surviving Corporation or the Paying Agent with respect to the Certificates alleged to have been lost, stolen or destroyed. (d) At any time following the 180th day after the Effective Time, Purchaser shall no longer be required to retain the Paying Agent and the Surviving Corporation shall be entitled to require the Paying Agent to deliver to it any funds which had been made available to the Paying Agent and not disbursed to holders of Shares (including, without limitation, all interest and other income received by the Paying Agent in respect of all funds made available to it), and, thereafter, such holders shall be entitled to look to the Surviving Corporation (subject to abandoned property, escheat and other similar laws) only with respect to any Merger Consideration that may be payable upon due surrender of the Certificates held by them. Notwithstanding the foregoing, neither the Surviving Corporation nor the Paying Agent shall be liable to any holder of a Share for any Merger Consideration delivered in respect of such Share to a public official pursuant to any abandoned property, escheat or other similar law. (e) At the close of business on the day of the Effective Time, the stock transfer books of the Company shall be closed and thereafter there shall be no further registration of transfers of Shares on the records of the Company. From and after the Effective Time, the holders of Shares outstanding immediately prior to the Effective Time shall cease to have any rights with respect to such Shares except as otherwise provided herein or by applicable law. 15 ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY As an inducement to Parent and Purchaser to enter into this Agreement, the Company hereby represents and warrants to Parent and Purchaser that, except as otherwise disclosed in the disclosure schedule delivered to Parent simultaneously herewith (the "Disclosure Schedule"): SECTION 4.01. ORGANIZATION AND QUALIFICATION; SUBSIDIARIES. (a) Each of the Company and each Subsidiary is a corporation duly organized, validly existing and, to the extent applicable, in good standing under the laws of the jurisdiction of its incorporation and has the requisite corporate power and authority and all necessary governmental approvals to own, lease and operate its properties and to carry on its business as it is now being conducted. The Company and each Subsidiary is duly qualified or licensed as a foreign corporation to do business, and is in good standing, in each jurisdiction where the character of the properties owned, leased or operated by it or the nature of its business makes such qualification or licensing necessary except where the failure to be so qualified or licensed would not, individually or in the aggregate, prevent or materially delay consummation of the Offer or have a Material Adverse Effect. (b) A true and complete list of all the Subsidiaries, together with the jurisdiction of incorporation of each Subsidiary and the percentage of the outstanding capital stock of each Subsidiary owned by the Company and each other Subsidiary, is set forth in Section 4.01(b) of the Disclosure Schedule. Except as disclosed in Section 4.01(b) of the Disclosure Schedule, the Company does not directly or indirectly own any equity or similar interest in, or any interest convertible into or exchangeable or exercisable for any equity or similar interest in, any corporation, partnership, joint venture or other business association or entity. SECTION 4.02. CERTIFICATE OF INCORPORATION AND BY-LAWS. The Company has heretofore furnished to Parent a complete and correct copy of the Second Amended and Restated Certificate of Incorporation (the "Certificate of Incorporation") and the By-laws or equivalent organizational documents, each as amended to date, of the Company and each Subsidiary. Such Certificate of Incorporation, By-laws or equivalent organizational documents are in full force and effect. Neither the Company nor any Subsidiary is in violation of any of the provisions of its Certificate of Incorporation, By-laws or equivalent organizational documents. SECTION 4.03. CAPITALIZATION. The authorized capital stock of the Company consists of 35,000,000 Shares and 1,000,000 shares of preferred stock, $0.01 value ("Company Preferred Stock"). As of the date hereof, (a) 18,621,403 Shares are issued and outstanding, all of which are validly issued, fully paid and nonassessable, (b) 16 432,000 Shares are held in the treasury of the Company, (c) no Shares are held by any Subsidiary, (d) 3,841,026 Shares are reserved for future issuance pursuant to outstanding employee stock options or stock incentive rights granted pursuant to the Company Stock Option Plans and (e) rights to purchase 19,579 Shares are outstanding pursuant to the ESPP. As of the date hereof, no shares of Company Preferred Stock are issued and outstanding. Except as set forth in Section 4.03 of the Disclosure Schedule and except (a) for the Stockholder Agreement and (b) the warrants to purchase 801,497 Shares (the "Warrants") and (c) the rights to purchase 19,579 Shares pursuant to the ESPP, there are no options, warrants or other rights, agreements, arrangements or commitments of any character relating to the issued or unissued capital stock of the Company or any Subsidiary or obligating the Company or any Subsidiary to issue or sell any shares of capital stock of, or other equity interests in, the Company or any Subsidiary. Section 4.03 of the Disclosure Schedule accurately sets forth information regarding the holder, the exercise price, the grant date and the number of underlying Shares issuable in respect of each Warrant and Option, and in respect of each right to purchase Shares pursuant to the ESPP (through the end of the ESPP's current offer period ending August 31, 2001) and the number of underlying Shares issuable pursuant to vested Options as of the date hereof. All Shares subject to issuance as aforesaid, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be duly authorized, validly issued, fully paid and nonassessable. No holder of any Warrant shall be entitled to receive any securities of any kind or other property, other than cash, if any, as, and to the extent, provided in Section 3.08 hereof. Section 4.03 of the Disclosure Schedule sets forth the number of unvested or unexercisable Options that will accelerate upon the closing of the Offer and the number of Shares issuable upon exercise thereof. Except with respect to the Options referred to in the immediately preceding sentence, no unvested or unexercisable Options will be vested or exercisable after the date hereof except for Options that vest after the date hereof monthly pursuant to their existing terms and which are exercisable for (x) no more than 137,599 Shares in the aggregate through December 31, 2001 and (y) no more than 38,433 Shares in the aggregate through December 31, 2001 with respect to Options with an exercise price that is less than the Per Share Price. There are no Options outstanding under the 1996 Option Plan other than Options exercisable for 5,000 Shares held by one of the Selling Stockholders. The total number of Shares issuable pursuant to the exercise of all Options and Warrants held by all Selling Stockholders is 1,797,665. There are no outstanding contractual obligations of the Company or any Subsidiary to repurchase, redeem or otherwise acquire any Shares or any other capital stock or other securities of the Company or any Subsidiary or to provide funds to, or make any investment (in the form of a loan, capital contribution or otherwise) in, any Subsidiary or any other person. Each outstanding share of capital stock of each Subsidiary is duly authorized, validly issued, fully paid and nonassessable, and each such share is owned by the Company or another Subsidiary free and clear of all security interests, liens, claims, pledges, options, rights of first refusal, agreements, limitations on the Company's or any Subsidiary's voting rights, charges and other encumbrances of any nature whatsoever. 17 SECTION 4.04. AUTHORITY RELATIVE TO THIS AGREEMENT. The Company has all necessary power and authority to execute and deliver this Agreement, to perform its obligations hereunder and, subject in the case of the Merger, to obtaining approval of the stockholders of the Company, if required, to consummate the Transactions. The execution and delivery of this Agreement by the Company and the consummation by the Company of the Transactions have been duly and validly authorized by all necessary corporate action, and no other corporate proceedings on the part of the Company are necessary to authorize this Agreement or to consummate the Transactions (other than, with respect to the Merger, the approval and adoption of this Agreement by the holders of a majority of the then-outstanding Shares, if and to the extent required by applicable law, and the filing and recordation of appropriate merger documents as required by Delaware Law). This Agreement has been duly executed and delivered by the Company and, assuming the due authorization, execution and delivery by Parent and Purchaser, constitutes a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to applicable bankruptcy, insolvency, moratorium or similar laws relating to creditors' rights and general principles of equity. The Board has approved this Agreement and the Transactions and such approvals are sufficient so that the restrictions on business combinations set forth in Section 203(a) of Delaware Law shall not apply to the Transactions. SECTION 4.05. NO CONFLICT; REQUIRED FILINGS AND CONSENTS. (a) The execution and delivery of this Agreement by the Company do not, and the performance of this Agreement by the Company will not, (i) conflict with or violate the Certificate of Incorporation or By-laws of the Company or equivalent organizational documents of any Subsidiary, (ii) subject to obtaining approval of the Company's stockholders described in Section 4.04 with respect to this Agreement and compliance with the requirements described in 4.05(b) below, conflict with or violate any United States or non-United States statute, law, ordinance, regulation, rule, code, common law standard or obligation, executive order, governmental directive, injunction, judgment, decree or other order ("Law") applicable to the Company or any Subsidiary or by which any property or asset of the Company or any Subsidiary is bound or affected, or (iii) except as set forth in Section 4.05(a)(iii) of the Disclosure Schedule, result in any breach of or constitute a default (or an event which, with notice or lapse of time or both, would become a default) under, or give to others any right of termination, amendment, acceleration or cancellation of, or result in the creation of a lien or other encumbrance on any property or asset of the Company or any Subsidiary pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise or other instrument or obligation to which the Company or any Subsidiary is a party or by which the Company or any Subsidiary or any property or asset of the Company or any Subsidiary is bound or affected, except, with respect to clauses (ii) and (iii), for any such conflicts, violations, breaches, defaults or other occurrences which would not, individually or in the aggregate, prevent or materially delay consummation of the Offer or the Merger and would not have a Material Adverse Effect. 18 (b) The execution and delivery of this Agreement by the Company do not, and the performance of this Agreement by the Company will not, require any consent, approval, authorization or permit of, or filing with or notification to, any United States federal, state, county or local or non-United States government, governmental, regulatory or administrative authority, agency, instrumentality or commission or any court, tribunal, or judicial or arbitral body (a "Governmental Authority"), except (i) for applicable requirements, if any, of the Exchange Act, state securities or "blue sky" laws ("Blue Sky Laws"), and filing and recordation of appropriate merger documents as required by Delaware Law, and (ii) where the failure to obtain such consents, approvals, authorizations or permits, or to make such filings or notifications, individually or in the aggregate, would not prevent or materially delay consummation of the Offer or the Merger and would not have a Material Adverse Effect. SECTION 4.06. PERMITS; COMPLIANCE. Each of the Company and the Subsidiaries is in possession of all registrations, franchises, grants, authorizations, licenses, permits, easements, variances, exceptions, consents, certificates, approvals and orders of any Governmental Authority necessary for each of the Company or the Subsidiaries to own, lease and operate its properties or to carry on its business as it is now being conducted (the "Permits"), except where the failure to have, or the suspension or cancellation of, any of the Permits, individually or in the aggregate, would not prevent or materially delay consummation of the Offer or the Merger and would not have a Material Adverse Effect. As of the date hereof, no suspension or cancellation of any of the Permits is pending or, to the knowledge of the Company, threatened, except where the failure to have, or the suspension or cancellation of, any of the Permits, individually or in the aggregate, would not prevent or materially delay consummation of the Offer or the Merger and would not have a Material Adverse Effect. Neither the Company nor any Subsidiary is in conflict with, or in default, breach or violation of, (a) any Law applicable to the Company or any Subsidiary or by which any property or asset of the Company or any Subsidiary is bound or affected, or (b) any note, bond, mortgage, indenture, contract, agreement, lease, license, Permit, franchise or other instrument or obligation to which the Company or any Subsidiary is a party or by which the Company or any Subsidiary or any property or asset of the Company or any Subsidiary is bound, except for any such conflicts, defaults, breaches or violations, individually or in the aggregate, that would not prevent or materially delay consummation of the Offer or the Merger and would not have a Material Adverse Effect. SECTION 4.07. SEC FILINGS; FINANCIAL STATEMENTS. (a) The Company has filed all forms, reports and documents required to be filed by it with the SEC since January 1, 1998 and has heretofore delivered or made available to Parent, in the form filed with the SEC, (i) its Annual Reports on Form 10-K for the fiscal years ended December 31, 1998, 1999 and 2000, respectively, (ii) its Quarterly Reports on Form 10-Q for the periods ended December 31, 2000 and March 31, 2001, (iii) all proxy statements relating to the Company's meetings of stockholders (whether annual or special) held since April 30, 1998 and (iv) all other forms including reports on Form 8-K and other registration statements (other than Quarterly Reports on Form 10-Q not referred to in 19 clause (ii) above) filed by the Company with the SEC since January 1, 2000 (the forms, reports and other documents referred to in clauses (i), (ii), (iii) and (iv) above being, collectively, the "SEC Reports"). The SEC Reports (i) were prepared in accordance with either the requirements of the Securities Act of 1933, as amended (together with the rules and regulations promulgated thereunder, the "Securities Act"), or the Exchange Act, as the case may be, and the rules and regulations promulgated thereunder, and (ii) did not, at the time they were filed, or, if amended, as of the date of such amendment, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. No Subsidiary is required to file any form, report or other document with the SEC. (b) The Company has furnished to Parent the unaudited consolidated balance sheet, the unaudited consolidated statement of operations and the unaudited consolidated statement of cash flows of the Company and the Subsidiaries as at June 30, 2001 and for the 6-month period then ended (the "June 30 Financials"). Each of the consolidated financial statements (including, in each case, any notes thereto) contained in the SEC Reports and the June 30 Financials was prepared in accordance with United States generally accepted accounting principles ("GAAP") applied on a consistent basis throughout the periods indicated (except as may be indicated in the notes thereto), and each fairly presents, in all material respects, the consolidated financial position, results of operations and cash flows of the Company and its consolidated Subsidiaries as at the respective dates thereof and for the respective periods indicated therein (subject, in the case of unaudited statements, to normal and recurring year-end adjustments which would not, individually or in the aggregate, have had, and would not have, a Material Adverse Effect). (c) Except as and to the extent set forth on the consolidated balance sheet of the Company and its consolidated Subsidiaries as at December 31, 2000, including the notes thereto (the "2000 Balance Sheet"), neither the Company nor any Subsidiary has any liability or obligation of any nature (whether accrued, absolute, contingent or otherwise), except for liabilities and obligations, incurred in the ordinary course of business and consistent with past practice since December 31, 2000, which would not, individually or in the aggregate, prevent or materially delay consummation of the Offer or the Merger and would not, individually or in the aggregate, have a Material Adverse Effect. (d) The Company has no Company Indebtedness. (e) The Company has heretofore furnished to Parent complete and correct copies of all amendments and modifications that have not been filed by the Company with the SEC to all agreements, documents and other instruments that previously had been filed by the Company with the SEC and are currently in effect. 20 SECTION 4.08. ABSENCE OF CERTAIN CHANGES OR EVENTS. Since March 31, 2001, except as set forth in Section 4.08 of the Disclosure Schedule, or as expressly contemplated by this Agreement, (a) the Company and the Subsidiaries have conducted their businesses only in the ordinary course and in a manner consistent with past practice, (b) there has not been any Material Adverse Effect, and (c) neither of the Company nor any Subsidiary has taken any action that, if taken after the date of this Agreement, would constitute a breach of any of the covenants set forth in Section 6.01. SECTION 4.09. ABSENCE OF LITIGATION. Except as set forth in Section 4.09 of the Disclosure Schedule, there is no litigation, suit, claim, action, proceeding or investigation (an "Action") pending or, to the knowledge of the Company, threatened against the Company or any Subsidiary, or any property or asset of the Company or any Subsidiary, before any Governmental Authority. Neither the Company nor any Subsidiary nor any property or asset of the Company or any Subsidiary is subject to any continuing order, writ, judgement, injunction, consent decree, determination or award of, settlement agreement or similar written agreement with, or, to the knowledge of the Company, continuing investigation by, any Governmental Authority. SECTION 4.10. EMPLOYEE BENEFIT PLANS. (a) Section 4.10(a) of the Disclosure Schedule lists (i) all employee benefit plans (as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended ("ERISA")) and all bonus, stock option, stock purchase, restricted stock, incentive, deferred compensation, retiree medical or life insurance, supplemental retirement, severance or other benefit plans, programs or arrangements, and all employment, termination, severance or other contracts or agreements, to which the Company or any Subsidiary is a party, with respect to which the Company or any Subsidiary has any obligation or which are maintained, contributed to or sponsored by the Company or any Subsidiary for the benefit of any current or former employee, officer or director of the Company or any Subsidiary, (ii) each employee benefit plan for which the Company or any Subsidiary could incur liability under Section 4069 of ERISA in the event such plan has been terminated, (iii) any plan in respect of which the Company or any Subsidiary could incur liability under Section 4212(c) of ERISA, and (iv) any contracts or arrangements between the Company or any Subsidiary and any employee of the Company or any Subsidiary including, without limitation, any contracts or arrangements relating to a sale of the Company or any Subsidiary (collectively, the "Plans"). The Company has furnished or made available to Purchaser a true and complete copy of each Plan which is in writing or a written summary of the material terms (including participants) of any Plan not in writing, and (i) each trust or other funding arrangement, (ii) the most recent plan description, (iii) the most recently filed Internal Revenue Service ("IRS") Form 5500, (iv) the most recently received IRS determination letter for each such Plan, and (v) the most recently prepared actuarial report and financial statement in connection with each such Plan. Neither the Company nor any Subsidiary has any commitment, (i) to create, incur liability with respect to or cause to exist any other employee benefit plan, program or arrangement, (ii) to enter into any contract or agreement to provide compensation or benefits to any individual, or (iii) to modify, change or terminate any Plan, other than with respect to a 21 modification, change or termination required by this Agreement, ERISA or the Internal Revenue Code of 1986, as amended (the "Code") or a modification or change that would not materially increase the cost of maintaining such Plan. (b) None of the Plans is a multiemployer plan (within the meaning of Section 3(37) or 4001(a)(3) of ERISA) (a "Multiemployer Plan") or a single employer pension plan (within the meaning of Section 4001(a)(15) of ERISA) for which the Company or any Subsidiary could incur liability under Section 4063 or 4064 of ERISA (a "Multiple Employer Plan"). Except as set forth in Section 4.10(b) of the Disclosure Schedule, none of the Plans (i) provides for the payment of separation, severance, termination or similar-type benefits to any person, (ii) obligates the Company or any Subsidiary to pay separation, severance, termination or similar-type benefits solely or partially as a result of any transaction contemplated by this Agreement, or (iii) obligates the Company or any Subsidiary to make any payment or provide any benefit as a result of a "change in control", within the meaning of such term under Section 280G of the Code. None of the Plans provides for or promises retiree medical, disability or life insurance benefits to any current or former employee, officer or director of the Company or any Subsidiary. Each of the Plans, other than Non-U.S. Benefit Plans (defined below), is subject only to the Laws of the United States or a political subdivision thereof. (c) Each Plan is now and has always been operated in all material respects in accordance with its terms and the requirements of all applicable Laws including, without limitation, ERISA and the Code. The Company and the Subsidiaries have performed all material obligations required to be performed by them under, are not in any respect in default under or in violation of, and have no knowledge of any default or violation by any party to, any Plan. No Action is pending or, to the knowledge of the Company, threatened with respect to any Plan (other than claims for benefits in the ordinary course) and, to the knowledge of the Company, no fact or event exists that could give rise to any such Action. (d) Each Plan that is intended to be qualified under Section 401(a) of the Code or Section 401(k) of the Code has received a favorable determination letter from the IRS that the Plan is so qualified and each trust established in connection with any Plan which is intended to be exempt from federal income taxation under Section 501(a) of the Code is so exempt, and no fact or event has occurred since the date of such determination letter from the IRS to adversely affect the qualified status of any such Plan. (e) There has not been any prohibited transaction (within the meaning of Section 406 of ERISA or Section 4975 of the Code) with respect to any Plan which could subject the Company or any Subsidiary to any material liability. Neither the Company nor any Subsidiary has incurred any material liability under, arising out of or by operation of Title IV of ERISA (other than liability for premiums to the Pension Benefit Guaranty Corporation arising in the ordinary course), including, without 22 limitation, any liability in connection with (i) the termination or reorganization of any employee benefit plan subject to Title IV of ERISA, or (ii) the withdrawal from any Multiemployer Plan or Multiple Employer Plan, and no fact or event exists which could give rise to any such liability. (f) All contributions, premiums or payments required to be made with respect to any Plan have been made on or before their due dates. All such contributions have been fully deducted for federal income tax purposes. (g) Any amount or economic benefit that could be received (whether in cash or property or the vesting of property) by any current or former director, officer, employee or consultant of the Company or any Subsidiary who is a "disqualified individual" (as such term is defined in proposed Treasury Regulation Section 1.280G-1) under any Plan, employment agreement or otherwise as a result of the execution and delivery of this Agreement by the Company or the consummation of the Merger or any other transaction contemplated by this Agreement (including as a result of termination of employment on or following the Effective Time) would not be characterized as an "excess parachute payment" (as defined in Section 280G(b)(1) of the Code). (h) In addition to the foregoing, with respect to each Plan that is not subject to United States law (a "Non-U.S. Benefit Plan"): (i) all employer and employee contributions to each Non-U.S. Benefit Plan required by law or by the terms of such Non-U.S. Benefit Plan have been made, or, if applicable, accrued in accordance with normal accounting practices, and a pro rata contribution for the period prior to and including the date of this Agreement has been made or accrued; (ii) no such Non-U.S. Benefit Plan is a defined benefit plan or provides for or promises retiree medical, disability or life insurance benefits to any current or former employee, officer or director of the Company or any Subsidiary; and (iii) each Non-U.S. Benefit Plan required to be registered has been registered and has been maintained in good standing with applicable regulatory authorities and is approved by any applicable taxation authorities to the extent such approval is required. Each Non-U.S. Benefit Plan is now and always has been operated in full 23 compliance with all applicable non-United States laws and regulations. SECTION 4.11. LABOR AND EMPLOYMENT MATTERS. (a) There are no claims pending or, to the knowledge of the Company, threatened between the Company or any Subsidiary and any of their respective employees, which claims, individually or in the aggregate, would prevent or materially delay consummation of the Offer or the Merger or would have a Material Adverse Effect. Neither the Company nor any Subsidiary is a party to any collective bargaining agreement, work council agreement, work force agreement or other labor union contract applicable to persons employed by the Company or any Subsidiary, nor, to the knowledge of the Company, are there any activities or proceedings of any labor union to organize any such employees. There are no unfair labor practice complaints pending against the Company or any Subsidiary before the National Labor Relations Board, any other court or tribunal or any current union representation questions involving employees of the Company or any Subsidiary and there is no strike, slowdown, work stoppage or lockout, or, to the knowledge of the Company, threat thereof, by or with respect to any employees of the Company or any Subsidiary. (b) The Company and the Subsidiaries are in compliance in all material respects with all applicable Laws relating to employment and employment practices, including those related to wages, hours, collective bargaining and the payment and withholding of taxes and other sums as required by the appropriate Governmental Authority and has withheld and paid to the appropriate Governmental Authority or are holding for payment not yet due to such Governmental Authority all amounts required to be withheld from employees of the Company or any Subsidiary and are not liable for any arrears of wages, taxes, penalties or other sums for failure to comply with any of the foregoing. The Company and the Subsidiaries have paid in full to all employees or adequately accrued in accordance with GAAP, all wages, salaries, commissions, bonuses, benefits and other compensation due to or on behalf of such employees and there is no claim with respect to payment of wages, salary or overtime pay that has been asserted or is now pending or threatened before any Governmental Authority with respect to any persons currently or formerly employed by the Company or any Subsidiary. Neither the Company nor any Subsidiary is a party to, or otherwise bound by, any consent decree with, or citation by, any Governmental Authority relating to employees or employment practices. There is no charge or proceeding with respect to a violation of any occupational safety or health standards that has been asserted or is now pending or threatened with respect to the Company. Except for item 3 set forth in Section 4.09 of the Disclosure Schedule, there is no charge of discrimination in employment or employment practices, for any reason, including, without limitation, age, gender, race, religion or other legally protected category, which has been asserted or is now pending or threatened before the United States Equal Employment Opportunity Commission, or any other Governmental Authority in any jurisdiction in which the Company or any Subsidiary have employed or employ any person. 24 (c) Except as set forth in Section 4.11(c) of the Disclosure Schedule, (i) all subsisting contracts of employment to which the Company or any Subsidiary is a party are terminable by the Company or any Subsidiary on three months' notice or less without compensation (other than in accordance with applicable legislation); (ii) there are no customs, established practices or discretionary arrangements of the Company or any Subsidiary in relation to the termination of employment of any of its employees (whether voluntary or involuntary); and (iii) neither the Company nor any Subsidiary has any outstanding liability to pay compensation for loss of office or employment to any present or former employee or to make any payment for breach of any agreement listed in Section 4.10(a) of the Disclosure Schedule. (d) All officers, management employees, and technical and professional employees of the Company and the Subsidiaries have entered into the standard form confidentiality agreement of the Company (the "Standard Form Confidentiality Agreement") which has been delivered to Parent and provides, among other matters, that they maintain in confidence all confidential or proprietary information acquired by them in the course of their employment and to assign to the Company and the Subsidiaries all inventions made by them within the scope of their employment during such employment and for a reasonable period thereafter. (e) Section 4.11(e) of the Disclosure Schedule lists the name, the place of employment, the current annual salary rates (including descriptions of any raises in the preceding three months), bonuses, deferred or contingent compensation (in cash or otherwise) in the current fiscal year and the date of employment of each current salaried employee, officer, director, consultant or agent of the Company and each Subsidiary. SECTION 4.12. OFFER DOCUMENTS; SCHEDULE 14D-9; PROXY STATEMENT. Neither the Schedule 14D-9 nor any information supplied by the Company for inclusion in the Offer Documents shall, at the times the Schedule 14D-9, the Offer Documents or any amendments or supplements thereto are filed with the SEC or are first published, sent or given to stockholders of the Company, as the case may be, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. Neither the proxy statement to be sent to the stockholders of the Company in connection with the Stockholders' Meeting (as hereinafter defined), if applicable, or the information statement to be sent to such stockholders, as appropriate (such proxy statement or information statement, as amended or supplemented, being referred to herein as the "Proxy Statement"), shall, at the date the Proxy Statement (or any amendment or supplement thereto) is first mailed to stockholders of the Company, at the time of the Stockholders' Meeting and at the Effective Time, contain any statement which, at the time and in light of the circumstances under which it was made, is false or misleading with respect to any material fact, or which omits to state any material fact necessary in order to make the statements therein not false or misleading or necessary to correct any statement in any earlier 25 communication with respect to the solicitation of proxies for the Stockholders' Meeting which shall have become false or misleading. The Schedule 14D-9 and the Proxy Statement shall comply in all material respects as to form with the requirements of the Exchange Act and the rules and regulations thereunder. SECTION 4.13. PROPERTY AND LEASES. (a) The Company and the Subsidiaries have sufficient title to all their properties and assets to conduct their respective businesses as currently conducted or as contemplated to be conducted, with only such exceptions as would not, individually or in the aggregate, have a Material Adverse Effect. (b) Neither the Company nor any Subsidiary owns any real property. Each parcel of real property leased by the Company or any Subsidiary (i) is leased free and clear of all mortgages, pledges, liens, security interests, conditional and installment sale agreements, encumbrances, charges or other claims of third parties of any kind against the Company or any Subsidiary, including, without limitation, any easement, right of way or other encumbrance to title, or any option, right of first refusal, or right of first offer applicable to the Company or any Subsidiary (collectively, "Liens"), other than (A) Liens for current taxes and assessments not yet past due, (B) inchoate mechanics' and materialmen's Liens for construction in progress, (C) workmen's, repairmen's, warehousemen's and carriers' Liens arising in the ordinary course of business of the Company or such Subsidiary consistent with past practice, and (D) all matters of record, Liens and other imperfections of title and encumbrances that, individually or in the aggregate, would not have a Material Adverse Effect (collectively, "Permitted Liens"), and (ii) is neither subject to any governmental decree or order to be sold nor is being condemned, expropriated or otherwise taken by any public authority with or without payment of compensation therefor, nor, to the knowledge of the Company, has any such condemnation, expropriation or taking been proposed. (c) All leases of real property leased for the use or benefit of the Company or any Subsidiary to which the Company or any Subsidiary is a party, and all amendments and modifications thereto, are in full force and effect and have not been modified or amended, and there exists no default under any such lease by the Company or any Subsidiary, nor any event which, with notice or lapse of time or both, would constitute a default thereunder by the Company or any Subsidiary, except as would not, individually or in the aggregate, prevent or materially delay consummation of the Offer or the Merger and would not, individually or in the aggregate, have a Material Adverse Effect. (d) To the knowledge of the Company, there are no contractual or legal restrictions that preclude or restrict the ability to use any real property leased by the Company or any Subsidiary for the purposes for which it is currently being used. To the knowledge of the Company, there are no material latent defects or material adverse 26 physical conditions affecting the real property, and improvements thereon, leased by the Company or any Subsidiary other than those that, individually or in the aggregate, would not prevent or materially delay consummation of the Offer or the Merger and would not have a Material Adverse Effect. SECTION 4.14. INTELLECTUAL PROPERTY. (a) Section 4.14(a) of the Disclosure Schedule lists all registered and material unregistered trademarks and applications therefor, trade names, service marks, registered and material unregistered copyrights and applications therefor, patents and patent applications, if owned by or licensed to the Company or any Subsidiary and indicating whether owned by or licensed to the Company or any Subsidiary. Section 4.14(a) of the Disclosure Schedule also lists all domain names owned by or licensed or registered to the Company or any Subsidiary. In addition, the Company represents and warrants to Parent and Purchaser as follows: (i) the conduct of the business of the Company and the Subsidiaries as currently conducted does not conflict with, infringe upon, misappropriate or otherwise violate the Intellectual Property rights of any third party, and no claim has been asserted against the Company or any Subsidiary or, to the knowledge of the Company, is threatened alleging that the conduct of the business of the Company and the Subsidiaries as currently conducted conflicts with, infringes upon or may infringe upon, misappropriates or otherwise violates the Intellectual Property rights of any third party except, in each case, where such conflict, infringement, misappropriation or other violation would not, individually or in the aggregate, have a Material Adverse Effect; (ii) with respect to each item of Intellectual Property owned by the Company or any Subsidiary and material to the business, financial condition or results of operations of the Company and the Subsidiaries, taken as a whole ("Company Owned Intellectual Property"), the Company and/or each such Subsidiary is the sole owner of the entire right, title and interest in and to such Company Owned Intellectual Property and is entitled to use such Company Owned Intellectual Property in the continued operation of its respective business; (iii) with respect to each item of Intellectual Property licensed to the Company or any Subsidiary and material to the business, financial condition or results of operations of the Company and the Subsidiaries, taken as a whole ("Company Licensed Intellectual Property"), the Company and/or each such Subsidiary has valid licenses or other rights to use such Company Licensed Intellectual 27 Property in the continued operation of its respective business in accordance with the terms of the license agreements governing such Company Licensed Intellectual Property and each such license pertaining to the Company Licensed Intellectual Property has been delivered to Parent; (iv) the Company Owned Intellectual Property and, to the knowledge of the Company, the Company Licensed Intellectual Property, are valid and enforceable, and have not been adjudged invalid or unenforceable in whole or in part; (v) the Company Owned Intellectual Property and the Company Licensed Intellectual Property constitute all of the material Intellectual Property necessary for the operation of the business of the Company and each Subsidiary as currently conducted; (vi) no Action is pending or, to the knowledge of the Company, threatened against the Company or any Subsidiary (A) based upon or challenging or seeking to deny or restrict the ownership by or license rights of the Company or any Subsidiary of any of the Company Owned Intellectual Property or Company Licensed Intellectual Property, (B) alleging that any services provided by, processes used by the Company or any Subsidiary conflict with, infringe upon, misappropriate or violate any Intellectual Property right of any third party, or (C) alleging that the Company Licensed Intellectual Property is being licensed or sublicensed in conflict with the terms of any license or other agreement; (vii) to the knowledge of the Company, no person is engaging in any activity that materially conflicts with, infringes upon or may infringe upon, misappropriates or violates the Company Owned Intellectual Property or Company Licensed Intellectual Property; (viii) each license of the Company Licensed Intellectual Property is valid and enforceable, subject to applicable bankruptcy, insolvency, moratorium or other similar laws relating to creditors' rights and general principles of equity, is binding on all parties to such license, and is in full force and effect; (ix) to the knowledge of the Company, no party to any license of the Company Licensed Intellectual Property is in breach thereof or default thereunder and no event has occurred that, with notice or 28 lapse of time, would constitute such breach or default or permit the termination or cancellation of the license; (x) neither the Company nor any Subsidiary received any notice of termination or cancellation under any license for the Company Licensed Intellectual Property; and (xi) neither the execution of this Agreement nor the consummation of any Transaction shall materially adversely affect any of the Company's or any Subsidiary's rights with respect to the Company Owned Intellectual Property or the Company Licensed Intellectual Property. (b) The Software owned or purported to be owned by the Company or any Subsidiary, was either (i) developed by employees of the Company or a Subsidiary within the scope of their employment who have validly assigned all their rights to the Company or a Subsidiary pursuant to the Standard Form Confidentiality Agreement, (ii) developed by independent contractors who have assigned their rights to the Company or a Subsidiary pursuant to written agreements or (iii) otherwise lawfully acquired by the Company or a Subsidiary from a third party pursuant to written agreements. The source code of any of the Company's Software and the data associated therewith have not been licensed or otherwise provided to another person. To the Company's knowledge, the Software is free of all viruses, worms, Trojan horses and other material known contaminants, and does not contain any bugs, errors, or problems of a material nature that could disrupt its operation or have an adverse impact on the operation of other material software programs or operating systems. The Company has obtained all approvals necessary for exporting the Software outside the United States and importing the Software into any country in which the Software is now sold or licensed for use, and all such export and import approvals in the United States and throughout the world are valid, current, outstanding and in full force and effect, except where the failure to obtain such approvals or the failure of such approvals to be valid, current, outstanding and in full force and effect would not, individually or in the aggregate, have a Material Adverse Effect. (c) The Company has taken all reasonable steps in order to safeguard and protect as confidential and proprietary its trade secrets and other confidential Intellectual Property. To the knowledge of the Company, (i) there has been no misappropriation of any material trade secrets or other material confidential Company Owned Intellectual Property by any person; (ii) no employee, independent contractor or agent of the Company has misappropriated any trade secrets of any other person in the course of such performance as an employee, independent contractor or agent; and (iii) no employee, independent contractor or agent of the Company is in material default or breach of any term of any employment agreement, non-disclosure agreement, assignment 29 of invention agreement or similar agreement or contract relating in any way to the protection, ownership, development, use or transfer of Company Owned Intellectual Property. SECTION 4.15. TAXES. The Company and the Subsidiaries have filed all United States federal, state, local and non-United States Tax returns and reports required to be filed by them and have paid and discharged all Taxes required to be paid or discharged, other than (a) such payments as are being contested in good faith by appropriate proceedings and (b) such filings, payments or other occurrences that would not have a Material Adverse Effect. Neither the IRS nor any other United States or non-United States taxing authority or agency is now asserting or, to the knowledge of the Company, threatening to assert against the Company or any Subsidiary any deficiency or claim for any Taxes or interest thereon or penalties in connection therewith. Neither the Company nor any Subsidiary has granted any waiver of any statute of limitations with respect to, or any extension of a period for the assessment of any Tax. The accruals and reserves for Taxes reflected in the 2000 Balance Sheet are adequate to cover all Taxes accruable through such date (including interest and penalties, if any, thereon) in accordance with GAAP. Neither the Company nor any Subsidiary has made an election under Section 341(f) of the Code. There are no Tax liens upon any property or assets of the Company or any of the Subsidiaries except liens for current Taxes not yet due. Neither the Company nor any of the Subsidiaries has been required to include in income any adjustment pursuant to Section 481 of the Code by reason of a voluntary change in accounting method initiated by the Company or any of the Subsidiaries, and the IRS has not initiated or proposed any such adjustment or change in accounting method, in either case which adjustment or change would have a Material Adverse Effect. Except as set forth in the financial statements described in Section 4.07, neither the Company nor any of the Subsidiaries has entered into a transaction which is being accounted for under the installment method of Section 453 of the Code, which would prevent or materially delay consummation of the Offer or the Merger or would have a Material Adverse Effect. SECTION 4.16. ENVIRONMENTAL MATTERS. Except as specifically described in Section 4.16 of the Disclosure Schedule or as would not, individually or in the aggregate, prevent or materially delay the consummation of the Offer or the Merger and would not have a Material Adverse Effect, (a) the Company and each Subsidiary are and have always been in compliance with all applicable Environmental Laws; (b) none of the properties currently or, to the knowledge of the Company, formerly, owned, leased or operated by the Company or any Subsidiary (including, without limitation, soils and surface and ground waters) are contaminated with any Hazardous Substance; (c) the Company is not actually or allegedly or, to the knowledge of the Company, potentially liable for any off-site contamination by Hazardous Substances; (d) the Company has not received any notice alleging that it is liable under any Environmental Law (including, without limitation, pending or threatened liens); (e) the Company has all permits, licenses and other authorizations required under any Environmental Law ("Environmental Permits"); (f) the Company has always been and is in compliance with its Environmental Permits; and (g) neither the execution of this Agreement nor the consummation of the 30 Transactions will require any investigation, remediation or other action with respect to Hazardous Substances, or any notice to or consent of Governmental Authorities or third parties, pursuant to any applicable Environmental Law or Environmental Permit. SECTION 4.17. MATERIAL CONTRACTS. (a) Subsections (i) through (xii) of Section 4.17(a) of the Disclosure Schedule contain a list of the following types of contracts and agreements to which the Company or any Subsidiary is a party (such contracts, agreements and arrangements as are required to be set forth in Section 4.17(a) of the Disclosure Schedule being the "Material Contracts"): (i) each contract and agreement (other than a contract with a customer of the Company) which (A) is likely to involve consideration of more than $250,000, in the aggregate, during the calendar year ending December 31, 2001, (B) is likely to involve consideration of more than $350,000, in the aggregate, over the remaining term of such contract, and which, in either case, cannot be canceled by the Company or any Subsidiary without penalty or further payment and without more than 90 days' notice; (ii) each contract and agreement with a customer of the Company or any Subsidiary which is likely to involve consideration of more than $350,000 annually over the remaining term of such contract and which cannot be canceled by the Company or any Subsidiary without penalty or further payment and without more than 90 days' notice; (iii) all material broker, distributor, reseller, dealer, manufacturer's representative, franchise, agency, sales promotion, market research, marketing consulting and advertising contracts and agreements to which the Company or any Subsidiary is a party; (iv) all management contracts (excluding contracts for employment) and contracts with other consultants, including any contracts involving the payment of royalties or other amounts calculated based upon the revenues or income of the Company or any Subsidiary or income or revenues related to any product or service of the Company or any Subsidiary to which the Company or any Subsidiary is a party; and which (A) is likely to involve consideration of more than $250,000 in the aggregate, during the calendar year ending December 31, 2001, (B) is likely to involve consideration of more than $350,000, in the aggregate, over the remaining term of such contract, and which, in either case, cannot 31 be cancelled by the Company or any Subsidiary without penalty or further payment and without more than 90 days' notice; (v) all contracts and agreements evidencing indebtedness for borrowed money, if any; (vi) all contracts and agreements with any Governmental Authority to which the Company or any Subsidiary is a party (other than standard form customer contracts previously disclosed to Purchaser); (vii) all contracts and agreements including, without limitation, licensing agreements, that limit, or purport to limit, the ability of the Company or any Subsidiary to compete in any line of business or with any person or entity or in any geographic area or during any period of time; (viii) all contracts or arrangements that result in any person or entity holding a power of attorney from the Company or any Subsidiary that relates to the Company, any Subsidiary or their respective businesses; (ix) all contracts relating in whole or in part to Intellectual Property pursuant to which the Company or any Subsidiary obtains from a third party the right to sell, distribute or otherwise display data or works owned or controlled by such third party and that is (A) likely to involve consideration of more than $250,000 in the aggregate during the calendar year ending December 31, 2001, (B) likely to involve consideration of more than $350,000, in the aggregate, over the remaining term of such contract, or (C) that does not involve any cash consideration but is otherwise material to the Company or any Subsidiary; (x) all contracts relating in whole or in part to Intellectual Property pursuant to which the Company or any Subsidiary grants to a third party the right to sell, distribute or otherwise display data or works owned or controlled by the Company or any Subsidiary and that is (A) likely to involve consideration of more than $250,000 in the aggregate during the calendar year ending December 31, 2001, (B) likely to involve consideration of more than $350,000 annually over the remaining term of such contract, or (C) that does not 32 involve any cash consideration but is otherwise material to the Company or any Subsidiary; (xi) all contracts for employment required to be listed in Section 4.10(a) of the Disclosure Schedule; and (xii) all other contracts and agreements, whether or not made in the ordinary course of business, which are material to the Company and the Subsidiaries, taken as a whole, or the conduct of their respective businesses, or the absence of which would prevent or materially delay consummation of the Offer or the Merger or would have a Material Adverse Effect. (b) Except as would not prevent or materially delay consummation of the Offer or the Merger and would not have a Material Adverse Effect, individually or in the aggregate and except as set forth in Section 4.17(b) of the Disclosure Schedule, (i) each Material Contract is a legal, valid and binding agreement, neither the Company nor any of the Subsidiaries is in default thereunder and, to the knowledge of the Company, none of the Material Contracts has been canceled by the other party; (ii) to the Company's knowledge, no other party is in breach or violation of, or default under, any Material Contract; (iii) the Company and the Subsidiaries are not in receipt of any claim of default under any such Material Contract; and (iv) neither the execution of this Agreement nor the consummation of any Transaction shall constitute default, give rise to cancellation rights, or otherwise adversely affect any of the Company's rights under any Material Contract. The Company has furnished to Parent true and complete copies of all Material Contracts, including any amendments thereto. SECTION 4.18. INSURANCE. (a) Section 4.18(a) of the Disclosure Schedule sets forth, with respect to each insurance policy under which the Company or any Subsidiary is insured, a named insured or otherwise the principal beneficiary of coverage which is currently in effect, (i) the names of the insurer, the principal insured and each named insured, (ii) the policy number, (iii) the period, scope and amount of coverage and (iv) the premium charged. Such insurance policies and the types and amounts of coverage provided therein are adequate and usual and customary in the context of the businesses and operations in which the Company and Subsidiaries are engaged. (b) With respect to each such insurance policy: (i) to the knowledge of the Company, the policy is legal, valid, binding and enforceable in accordance with its terms and is in full force and effect; (ii) neither the Company nor any Subsidiary is in material breach or default (including any such breach or default with respect to the payment of premiums or the giving of notice), and no event has occurred which, with 33 notice or the lapse of time, would constitute such a material breach or default, or permit termination or modification, under the policy; and (iii) to the knowledge of the Company, no insurer on the policy has been declared insolvent or placed in receivership, conservatorship or liquidation. (c) At no time subsequent to January 1, 1998 has the Company or any Subsidiary (i) been denied any insurance or indemnity bond coverage which it has requested, (ii) made any material reduction in the scope or amount of its insurance coverage, or (iii) received notice from any of its insurance carriers that any insurance premiums will be subject to increase in an amount materially disproportionate to the amount of the increases with respect thereto (or with respect to similar insurance) in prior years or that any insurance coverage listed in Section 4.18(a) of the Disclosure Schedule will not be available in the future substantially on the same terms as are now in effect. SECTION 4.19. BROKERS. No broker, finder or investment banker (other than Broadview) is entitled to any brokerage, finder's or other fee or commission in connection with the Transactions based upon arrangements made by or on behalf of the Company. The Company has heretofore furnished to Parent a complete and correct copy of all agreements between the Company and Broadview pursuant to which such firm would be entitled to any payment relating to the Transactions. ARTICLE V REPRESENTATIONS AND WARRANTIES OF PARENT AND PURCHASER As an inducement to the Company to enter into this Agreement, Parent and Purchaser hereby, jointly and severally, represent and warrant to the Company that: SECTION 5.01. CORPORATE ORGANIZATION. Each of Parent and Purchaser is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and has the requisite corporate power and authority and all necessary governmental approvals to own, lease and operate its properties and to carry on its business as it is now being conducted. Parent and Purchaser have heretofore made available to the Company complete and correct copies of their respective Certificates of Incorporation and By-laws, and each such instrument is in full force and effect. SECTION 5.02 AUTHORITY RELATIVE TO THIS AGREEMENT. Each of Parent and Purchaser has all necessary corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the Transactions. The execution and delivery of this Agreement by Parent and Purchaser and the consummation by Parent and Purchaser of the Transactions have been duly and validly 34 authorized by all necessary corporate action, and no other corporate proceedings on the part of Parent or Purchaser are necessary to authorize this Agreement or to consummate the Transactions (other than, with respect to the Merger, the filing and recordation of appropriate merger documents as required by Delaware Law). This Agreement has been duly and validly executed and delivered by Parent and Purchaser and, assuming due authorization, execution and delivery by the Company, constitutes a legal, valid and binding obligation of each of Parent and Purchaser enforceable against each of Parent and Purchaser in accordance with its terms subject to applicable bankruptcy, insolvency, moratorium or other similar laws relating to creditors' rights and general principles of equity. SECTION 5.03. NO CONFLICT; REQUIRED FILINGS AND CONSENTS. (a) The execution and delivery of this Agreement by Parent and Purchaser do not, and the performance of this Agreement by Parent and Purchaser will not, (i) conflict with or violate the Certificate of Incorporation or By-laws of either Parent or Purchaser, (ii) assuming that all consents, approvals, authorizations and other actions described in Section 5.03(b) have been obtained and all filings and obligations described in Section 5.03(b) have been made, conflict with or violate any law, rule, regulation, order, judgment or decree applicable to Parent or Purchaser or by which any property or asset of either of them is bound or affected, or (iii) result in any breach of, or constitute a default (or an event which, with notice or lapse of time or both, would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, or result in the creation of a lien or other encumbrance on any property or asset of Parent or Purchaser pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise or other instrument or obligation to which Parent or Purchaser is a party or by which Parent or Purchaser or any property or asset of either of them is bound or affected, except, with respect to clauses (ii) and (iii), for any such conflicts, violations, breaches, defaults or other occurrences which would not, individually or in the aggregate, prevent or materially delay consummation of the Transactions or otherwise prevent Parent and Purchaser from performing their material obligations under this Agreement. (b) The execution and delivery of this Agreement by Parent and Purchaser do not, and the performance of this Agreement by Parent and Purchaser will not, require any consent, approval, authorization or permit of, or filing with, or notification to, any Governmental Authority, except (i) for applicable requirements, if any, of the Exchange Act, Blue Sky Laws and filing and recordation of appropriate merger documents as required by Delaware Law, and (ii) where the failure to obtain such consents, approvals, authorizations or permits, or to make such filings or notifications, would not prevent or materially delay consummation of the Transactions, or otherwise prevent Parent or Purchaser from performing their material obligations under this Agreement. 35 SECTION 5.04. FINANCING. Parent has, will have through the Effective Time and will make available to Purchaser sufficient funds or available borrowing capacity to permit Purchaser to consummate all the Transactions, including, without limitation, acquiring all the outstanding Shares in the Offer and the Merger. SECTION 5.05. OFFER DOCUMENTS; PROXY STATEMENT. The Offer Documents shall not, at the time the Offer Documents are filed with the SEC or are first published, sent or given to stockholders of the Company, as the case may be, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. The information supplied by Parent for inclusion in the Schedule 14D-9 and Proxy Statement, if any, shall not, at the date the Proxy Statement (or any amendment or supplement thereto) is first mailed to stockholders of the Company, at the time of the Stockholders' Meeting or at the Effective Time, contain any untrue statement of a material fact, or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not false or misleading, or necessary to correct any statement in any earlier communication with respect to the solicitation of proxies for the Stockholders' Meeting which shall have become false or misleading. Notwithstanding the foregoing, Parent and Purchaser make no representation or warranty with respect to any information supplied by the Company or any of its representatives for inclusion in any of the foregoing documents or the Offer Documents. The Offer Documents shall comply in all material respects as to form with the requirements of the Exchange Act and the rules and regulations thereunder. SECTION 5.06. BROKERS. No broker, finder or investment banker is entitled to any brokerage, finder's or other fee or commission in connection with the Transactions based upon arrangements made by or on behalf of Parent or Purchaser. SECTION 5.07. PERFORMANCE. Since March 31, 2001, there has not been with respect to Parent any condition, event or occurrence which, individually or in the aggregate, would reasonably be expected to prevent or materially delay the ability of Parent or Purchaser to consummate the Transactions or to perform their obligations thereunder. SECTION 5.08. LITIGATION. As of the date of this Agreement, there are no Actions pending or, to the knowledge of Parent, threatened, against Parent or any of its subsidiaries or any of their respective properties, before any Governmental Authority that seeks to restrain or enjoin the consummation of the transactions contemplated by this Agreement or prevent or materially delay the ability of Parent and Purchaser to consummate the Transactions or for Parent and Purchaser to perform their obligations thereunder. 36 ARTICLE VI CONDUCT OF BUSINESS PENDING THE MERGER SECTION 6.01. CONDUCT OF BUSINESS BY THE COMPANY PENDING THE MERGER. The Company agrees that, between the date of this Agreement and the earlier of the termination of this Agreement pursuant to Section 9.01 hereof or the Effective Time, except as set forth in Section 6.01 of the Disclosure Schedule, unless Parent shall otherwise agree in writing, the businesses of the Company and the Subsidiaries shall be conducted only in, and the Company and the Subsidiaries shall not take any action except in, the ordinary course of business and in a manner consistent with past practice; and the Company shall use its reasonable best efforts to preserve substantially intact the business organization of the Company and the Subsidiaries, to keep available the services of the current officers, employees and consultants of the Company and the Subsidiaries and to preserve the current relationships of the Company and the Subsidiaries with customers, suppliers and other persons with which the Company or any Subsidiary has significant business relations. By way of amplification and not limitation, except as expressly contemplated by this Agreement and Section 6.01 of the Disclosure Schedule, neither the Company nor any Subsidiary shall, between the date of this Agreement and the earlier of the termination of this Agreement pursuant to Section 9.01 hereof or the Effective Time, directly or indirectly, do, or propose to do, any of the following without the prior written consent of Parent: (a) amend or otherwise change its Certificate of Incorporation or By-laws or equivalent organizational documents; (b) issue, sell, pledge, dispose of, grant, encumber, or authorize the issuance, sale, pledge, disposition, grant or encumbrance of, (i) any shares of any class of capital stock of the Company or any Subsidiary, or any options, warrants, convertible securities or other rights of any kind to acquire any shares of such capital stock, or any other ownership interest (including, without limitation, any phantom interest), of the Company or any Subsidiary (except for the issuance of a maximum of 3,841,026 Shares issuable pursuant to options outstanding on the date hereof under the Company Stock Option Plans and 801,497 Shares issuable pursuant to the Warrants, or rights to purchase Shares pursuant to the ESPP in each case as set forth in Section 4.03 of the Disclosure Schedule), or (ii) any assets of the Company or any Subsidiary, except in the ordinary course of business and in a manner consistent with past practice; (c) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock; 37 (d) reclassify, combine, split, subdivide or redeem, or purchase or otherwise acquire, directly or indirectly, any of its capital stock; (e) (i) acquire (including, without limitation, by merger, consolidation, or acquisition of stock or assets or any other business combination) any corporation, partnership, other business organization or any division thereof or any material amount of assets; (ii) incur any indebtedness for borrowed money or issue any debt securities or assume, guarantee or endorse, or otherwise become responsible for, the obligations of any person, or make any loans or advances (except for the extension of advances to employees in the ordinary course of business and consistent with past practice), or grant any security interest in any of its assets; (iii) enter into any contract or agreement other than in the ordinary course of business and consistent with past practice; (iv) authorize, or make any commitment with respect to, any single capital expenditure which is in excess of $50,000 or capital expenditures which are, in the aggregate, in excess of $250,000 for the Company and the Subsidiaries taken as a whole; (v) make or direct to be made any capital investments or equity investments in any entity, other than a wholly owned Subsidiary; or (vi) enter into or amend any contract, agreement, commitment or arrangement with respect to any matter set forth in this Section 6.01(e); (f) Intentionally deleted. (g) increase the compensation payable or to become payable or the benefits provided to its directors, officers or employees, except for increases in the ordinary course of business and consistent with past practice in salaries or wages of employees of the Company or any Subsidiary who are not directors or officers of the Company, or grant any severance or termination pay to, or enter into any employment or severance agreement with, any director, officer or other employee of the Company or of any Subsidiary, or hire any new officer, or hire any new employee other than employees hired in the ordinary course of business and consistent with past practice, or establish, adopt, enter into or amend any collective bargaining, bonus, profit-sharing, thrift, compensation, stock option, restricted stock, pension, retirement, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of any director, officer or employee (unless required by law); (h) change any accounting methods used by it unless required by GAAP; (i) make any material tax election or settle or compromise any material United States federal, state, local or non-United States income tax liability; (j) pay, discharge or satisfy any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction, (A) in the ordinary course of business and consistent with past practice, of liabilities reflected or reserved against in the 2000 Balance Sheet or subsequently incurred in the ordinary course of business and consistent with past 38 practice, (B) of any liabilities under the existing employment or executive bonus agreements of the Company set forth in Section 4.10(a) of the Disclosure Schedule, and (C) of fees and expenses in connection with the transition of control of the Company's business to Parent and Purchaser; (k) pay or delay the payment of accounts payable or accelerate the collection of accounts receivable, in either case outside of the ordinary course of business and consistent with past practice other than the payment of fees and expenses in connection with the transition of control of the Company's business to Parent or Purchaser; (l) amend, modify or consent to the termination of any Material Contract, or amend, waive, modify or consent to the termination of the Company's or any Subsidiary's rights thereunder, other than in the ordinary course of business and consistent with past practice; (m) commence or settle any Action other than, with the prior written consent of Parent (which consent shall not be unreasonably withheld or delayed) the Actions set forth in Section 4.09 of the Disclosure Schedule; (n) amend or modify any of the Amended Employment Agreements; (o) accelerate the vesting or exercisability of any Options, other than as and to the extent expressly set forth in Section 4.03 of the Disclosure Schedule; or (p) announce an intention, enter into any formal or informal agreement or otherwise make a commitment, to do any of the foregoing. ARTICLE VII ADDITIONAL AGREEMENTS SECTION 7.01. STOCKHOLDERS' MEETING. (a) If required by applicable law in order to consummate the Merger, the Company, acting through the Board, shall, in accordance with applicable law and the Company's Certificate of Incorporation and By-laws, (i) duly call, give notice of, convene and hold an annual or special meeting of its stockholders as promptly as practicable following consummation of the Offer for the purpose of considering and taking action on this Agreement and the Transactions (the "Stockholders' Meeting") and (ii) (A) except as provided in Section 7.05(b), include in the Proxy Statement, and not subsequently withhold, withdraw, amend, change or modify 39 in any manner adverse to Purchaser or Parent, the unanimous recommendation of the Board that the stockholders of the Company approve and adopt this Agreement and the Transactions and (B) use its best efforts to obtain such approval and adoption. At the Stockholders' Meeting, Parent and Purchaser shall cause all Shares then owned by them and their subsidiaries to be voted in favor of the approval and adoption of this Agreement and the Transactions. (b) Notwithstanding the foregoing, in the event that Purchaser shall acquire at least 90% of the then outstanding Shares, the parties shall take all necessary and appropriate action to cause the Merger to become effective, in accordance with Section 253 of Delaware Law, as promptly as reasonably practicable after such acquisition, without a meeting of the stockholders of the Company. SECTION 7.02. PROXY STATEMENT. If approval of the Company's stockholders is required by applicable law to consummate the Merger, promptly following consummation of the Offer, the Company shall file the Proxy Statement with the SEC under the Exchange Act, and shall use its best efforts to have the Proxy Statement cleared by the SEC promptly after such filing. Parent, Purchaser and the Company shall cooperate with each other in the preparation of the Proxy Statement, and the Company shall notify Parent of the receipt of any comments of the SEC with respect to the Proxy Statement and of any requests by the SEC for any amendment or supplement thereto or for additional information and shall provide to Parent promptly copies of all correspondence between the Company or any representative of the Company and the SEC. The Company shall provide Parent and its counsel the opportunity to review the Proxy Statement, including all amendments and supplements thereto, prior to its being filed with the SEC and shall give Parent and its counsel the opportunity to review all responses to requests for additional information and replies to comments prior to their being filed with, or sent to, the SEC. Each of the Company, Parent and Purchaser agrees to use its reasonable best efforts, after consultation with the other parties hereto, to respond promptly to all such comments of and requests by the SEC and to cause the Proxy Statement and all required amendments and supplements thereto to be mailed to the holders of Shares entitled to vote at the Stockholders' Meeting at the earliest practicable time. SECTION 7.03. COMPANY BOARD REPRESENTATION; SECTION 14(f). (a) Promptly upon the purchase by Purchaser of Shares pursuant to the Offer and from time to time thereafter, Purchaser shall be entitled to designate up to such number of directors, rounded up to the next whole number but rounded down if rounding up would cause Purchaser's representatives to constitute the entire Board, on the Board as shall give Purchaser representation on the Board equal to the product of the total number of directors on the Board (giving effect to the directors elected pursuant to this sentence) multiplied by the percentage that the aggregate number of Shares beneficially owned by Purchaser or any affiliate of Purchaser following such purchase bears to the total number of Shares then outstanding, and the Company shall, at such time, promptly take all 40 actions necessary to cause Purchaser's designees to be elected as directors of the Company, including increasing the size of the Board or securing the resignations of incumbent directors, or both. At such times, the Company shall use its reasonable best efforts to cause persons designated by Purchaser to constitute the same percentage as persons designated by Purchaser shall constitute of the Board of (i) each committee of the Board, (ii) each board of directors of each Subsidiary, and (iii) each committee of each such board, in each case only to the extent permitted by applicable Law. Notwithstanding the foregoing, until the Effective Time, the Company shall use its reasonable best efforts to ensure that at least two members of the Board and each committee of the Board and such boards and committees of the Subsidiaries, as of the date hereof, who are not employees of the Company shall remain members of the Board and of such boards and committees. (b) The Company shall promptly take all actions required pursuant to Section 14(f) of the Exchange Act and Rule 14f-1 promulgated thereunder to fulfill its obligations under this Section 7.03, and shall include in the Schedule 14D-9 such information with respect to the Company and its officers and directors as is required under Section 14(f) and Rule 14f-1 to fulfill such obligations. Parent or Purchaser shall supply to the Company, and be solely responsible for, any information with respect to either of them and their nominees, officers, directors and affiliates required by such Section 14(f) and Rule 14f-1. (c) Following the election of designees of Purchaser pursuant to this Section 7.03, prior to the Effective Time, any amendment of this Agreement or the Certificate of Incorporation or By-laws of the Company, any termination of this Agreement by the Company, any extension by the Company of the time for the performance of any of the obligations or other acts of Parent or Purchaser, or waiver of any of the Company's rights hereunder, shall require the concurrence of a majority of the directors of the Company then in office who neither were designated by Purchaser nor are employees of the Company or any Subsidiary. SECTION 7.04. ACCESS TO INFORMATION; CONFIDENTIALITY. (a) From the date hereof until the Effective Time, the Company shall, and shall cause the Subsidiaries and the officers, directors, employees, auditors and agents of the Company and the Subsidiaries to, afford the officers, employees and agents of Parent and Purchaser reasonable access at all reasonable times to the officers, employees, agents, properties, offices, plants and other facilities, books and records of the Company and each Subsidiary, and shall furnish Parent and Purchaser with such financial, operating and other data and information as Parent or Purchaser, through their officers, employees or agents, may reasonably request. (b) All information obtained by Parent or Purchaser pursuant to this Section 7.04 shall be kept confidential in accordance with the confidentiality agreement, 41 dated May 16, 2001, (the "Confidentiality Agreement"), between West Group, an affiliate of Parent and the Company. (c) No investigation pursuant to this Section 7.04 or otherwise shall affect any representation or warranty in this Agreement of any party hereto or any condition to the obligations of the parties hereto or any condition to the Offer. SECTION 7.05. NO SOLICITATION OF TRANSACTIONS. (a) Neither the Company nor any Subsidiary shall, directly or indirectly, through any officer, director, employee, representative, agent or otherwise, (i) solicit, initiate or take any action intended to encourage the submission of any Acquisition Proposal, or (ii) except as required by the fiduciary duties of the Board under applicable Law (as determined in good faith) after having received advice from outside legal counsel in response to unsolicited proposals, participate in any discussions or negotiations regarding, or furnish to any person, any information (provided that prior to furnishing such information, the Company enters into a customary, confidentiality agreement on terms no less favorable to the Company than those contained in the Confidentiality Agreement) with respect to, or otherwise cooperate in any way with respect to, or assist or participate in, or take any action intended to facilitate or encourage, any proposal that constitutes, or may reasonably be expected to lead to, an Acquisition Proposal. (b) Except as set forth in this Section 7.05(b), neither the Board nor any committee thereof shall (i) withhold, withdraw, amend, change or modify, or propose to withhold, withdraw, amend, change or modify, in a manner adverse to Parent or Purchaser, the approval or recommendation by the Board or any such committee of this Agreement, the Offer, the Merger or any other Transaction, (ii) approve or recommend, or propose to approve or recommend, any Acquisition Proposal or (iii) enter into any agreement with respect to any Acquisition Proposal. Notwithstanding the foregoing, in the event that, prior to the time of acceptance for payment of Shares pursuant to the Offer, the Board determines in good faith that it is required to do so by its fiduciary duties under applicable law after having received advice from outside legal counsel and that the Acquisition Proposal constitutes, or may reasonably be expected to lead to, a Superior Proposal, after giving prior written notice to Parent and Purchaser, the Board may withhold, withdraw, amend, change or modify its approval or recommendation of the Offer and the Merger, but only to terminate this Agreement in accordance with Section 9.01(d)(ii). (c) The Company shall, and shall direct or cause its directors, officers, employees, representatives, agents or other representatives to, immediately cease and cause to be terminated any discussions or negotiations with any parties that may be ongoing with respect to any Acquisition Proposal as of the date hereof. 42 (d) The Company shall promptly advise Parent orally (within one (1) Business Day) and in writing (within two (2) Business Days) of (i) any Acquisition Proposal or any request for information with respect to any Acquisition Proposal, the material terms and conditions of such Acquisition Proposal or request and the identity of the person making such Acquisition Proposal or request and (ii) any changes in any such Acquisition Proposal or request. (e) Nothing contained in this Section 7.05 shall prohibit the Company from taking and disclosing to its stockholders a position contemplated by Rules 14d-9 and 14e-2(a) promulgated under the Exchange Act or from making any disclosure to the Company's stockholders, if the Board determines in good faith that it is required to do so by its fiduciary duties under applicable law after having received advice from outside legal counsel; provided, however, that neither the Company nor the Board nor any committee thereof shall, except as permitted by Section 7.05(b), withhold, withdraw, amend, change or modify, or propose publicly to withhold, withdraw, amend, change or modify, its position with respect to this Agreement, the Offer, the Merger or any other Transaction or to approve or recommend, or propose publicly to approve or recommend, an Acquisition Proposal, including a Superior Proposal. (f) The Company agrees, except as required by the Board's fiduciary duties under applicable law after having received advice from outside legal counsel, not to release any third party from, or waive any provision of, any confidentiality or standstill agreement to which the Company is a party. SECTION 7.06. EMPLOYEE BENEFITS MATTERS. As of the Effective Time, Parent shall cause the Surviving Corporation to honor, in accordance with their terms, all employee benefit plans and programs in effect immediately prior to the Effective Time that are applicable to any current or former employees of the Company or any Subsidiary. Employees of the Company or any Subsidiary shall receive credit for the purposes of eligibility to participate and vesting (but not for benefit accruals) under any employee benefit plan or program established or maintained by the Surviving Corporation for service accrued or deemed accrued prior to the Effective Time with the Company or any Subsidiary; provided, however, that such crediting of service shall not operate to duplicate any benefit or the funding of any such benefit. Notwithstanding anything in this Section 7.06 to the contrary, nothing in this Section 7.06 shall be deemed to limit or otherwise affect the right of Parent, Purchaser or the Surviving Corporation (i) to terminate employment or change the place of work, responsibilities, status or description of any employee or group of employees, or (ii) to terminate any employee benefit plan without establishing a replacement plan, in each case as Parent, Purchaser or Surviving Corporation may determine in its discretion. SECTION 7.07 DIRECTORS' AND OFFICERS' INDEMNIFICATION AND INSURANCE. (a) The By-laws of the Surviving Corporation shall contain provisions no 43 less favorable with respect to indemnification than are set forth in Article 7 of the By-laws of the Company, which provisions shall not be amended, repealed or otherwise modified for a period of three years from the Effective Time in any manner that would affect adversely the rights thereunder of individuals who, at or prior to the Effective Time, were directors, officers, employees, fiduciaries or agents of the Company, unless such modification shall be required by law. (b) The Surviving Corporation shall use its reasonable best efforts to maintain in effect for three years from the Effective Time, if available, the current directors' and officers' liability insurance policies maintained by the Company (provided that the Surviving Corporation may substitute therefor policies of at least the same coverage containing terms and conditions that are not materially less favorable) with respect to matters occurring prior to the Effective Time. SECTION 7.08. NOTIFICATION OF CERTAIN MATTERS. The Company shall give prompt notice to Parent, and Parent shall give prompt notice to the Company, of (a) the occurrence, or non-occurrence, of any event the occurrence, or non-occurrence, of which reasonably could be expected to cause any representation or warranty contained in this Agreement to be untrue or inaccurate in any material respect and (b) any failure of the Company, Parent or Purchaser, as the case may be, to comply with or satisfy any covenant or agreement to be complied with or satisfied by it hereunder; provided, however, that the delivery of any notice pursuant to this Section 7.08 shall not limit or otherwise affect the remedies available hereunder to the party receiving such notice. SECTION 7.09. FURTHER ACTION; REASONABLE BEST EFFORTS. (a) Upon the terms and subject to the conditions hereof, each of the parties hereto shall (i) make promptly its respective filings, and thereafter promptly make any other required submissions in any country where a merger filing or other antitrust notification is necessary or desirable, including but not limited to the United Kingdom, the Federal Democratic Republic of Germany and Brazil, with respect to the Transactions and (ii) use its reasonable best efforts to take, or cause to be taken, all appropriate action, and to do, or cause to be done, all things necessary, proper or advisable under applicable laws and regulations to consummate and make effective the Transactions, including, without limitation, using its reasonable best efforts to obtain all Permits, consents, approvals, authorizations, qualifications and orders of Governmental Authorities and parties to contracts with the Company and the Subsidiaries as are necessary for the consummation of the Transactions and to inform or consult with any trade unions, work councils, employee representative or any other representative body as required and to fulfill the conditions to the Offer and the Merger; provided that neither Purchaser nor Parent will be required by this Section 7.09 to take any action, including entering into any consent decree, hold separate orders or other arrangements, that (A) requires the divestiture of any assets of any of Purchaser, Parent, the Company or any of their respective subsidiaries or (B) limits Parent's freedom of action with respect to, or its ability to retain, the Company and the Subsidiaries or any portion thereof or any of Parent's or its 44 affiliates' other assets or businesses. In case, at any time after the Effective Time, any further action is necessary or desirable to carry out the purposes of this Agreement, the proper officers and directors of each party to this Agreement shall use their reasonable best efforts to take all such action. (b) Each of the parties hereto agrees to cooperate and use its reasonable best efforts to vigorously contest and resist any Action, including administrative or judicial Action, and to have vacated, lifted, reversed or overturned any decree, judgment, injunction or other order (whether temporary, preliminary or permanent) that is in effect and that restricts, prevents or prohibits consummation of the Transactions, including, without limitation, by vigorously pursuing all available avenues of administrative and judicial appeal. (c) Immediately prior to the consummation of the Offer, the Company shall deliver to Purchaser a certificate, executed by a senior officer of the Company, in respect of the conditions set forth in paragraphs (ii)(e) and (ii)(f)(i) of Annex A. SECTION 7.10. PUBLIC ANNOUNCEMENTS. Parent, Purchaser and the Company agree that no public release or announcement concerning the Transactions, the Offer or the Merger shall be issued by any party without the prior consent of the other party (which consent shall not be unreasonably withheld), except as such release or announcement may be required by Law or the rules or regulations of any United States or non-United States securities exchange, in which case the party required to make the release or announcement shall use its best efforts to allow the other parties reasonable time to comment on such release or announcement in advance of such issuance. ARTICLE VIII CONDITIONS TO THE MERGER SECTION 8.01. CONDITIONS TO THE MERGER. The obligations of each party to effect the Merger shall be subject to the satisfaction, at or prior to the Effective Time, of the following conditions: (a) Stockholder Approval. If necessary under Delaware Law, this Agreement shall have been approved and adopted by the affirmative vote of the stockholders of the Company; (b) No Order. No Governmental Authority shall have enacted, issued, promulgated, enforced or entered any Law (whether temporary, preliminary or permanent) which is then in effect and has the effect of making the acquisition of Shares 45 by Parent or Purchaser or any affiliate of either of them illegal or otherwise restricting, preventing or prohibiting consummation of the Transactions; and (c) Offer. Purchaser or its permitted assignee shall have purchased all Shares validly tendered and not withdrawn pursuant to the Offer. ARTICLE IX TERMINATION, AMENDMENT AND WAIVER SECTION 9.01. TERMINATION. This Agreement may be terminated and the Merger and the other Transactions may be abandoned at any time prior to the Effective Time, notwithstanding any requisite approval and adoption of this Agreement by the stockholders of the Company: (a) By mutual written consent of each of Parent, Purchaser and the Company duly authorized by the Boards of Directors of Purchaser and the Company; or (b) By either Parent, Purchaser or, upon approval of the Board, by the Company if (i) the Effective Time shall not have occurred on or before December 31, 2001; provided, however, that the right to terminate this Agreement under this Section 9.01(b) shall not be available to any party whose failure to fulfill any obligation under this Agreement has been the cause of, or resulted in, the failure of the Effective Time to occur on or before such date or (ii) any Governmental Authority shall have enacted, issued, promulgated, enforced or entered any injunction, order, decree or ruling (whether temporary, preliminary or permanent) which has become final and nonappealable and has the effect of making consummation of the Offer or the Merger illegal or otherwise preventing or prohibiting consummation of the Offer or the Merger; or (c) By Parent if (i) Purchaser shall have (A) failed to commence the Offer within ten (10) Business Days following the date of this Agreement due to the occurrence of any of the events set forth in paragraph (d)(ii) of Annex A, (B) terminated the Offer due to the occurrence of any of the events set forth in paragraph (d)(ii) of Annex A, or the Offer shall have expired, without Purchaser having accepted any Shares for payment thereunder or (C) failed to accept Shares for payment pursuant to the Offer within 90 days following the commencement of the Offer, unless such action or inaction under (A), (B) or (C) shall have been caused by or resulted from the failure of Parent or Purchaser to perform, in any material respect, any of their material covenants or agreements contained in this Agreement, or the material breach by Parent or Purchaser of any of their material representations or warranties contained in this Agreement or (ii) prior to the purchase of Shares pursuant to the Offer, the Board or any committee thereof shall have withheld, withdrawn, amended, changed or modified in a manner adverse to 46 Purchaser or Parent its approval or recommendation of this Agreement, the Offer, the Merger or any other Transaction, or shall have recommended or approved any Acquisition Proposal, or shall have resolved to do any of the foregoing; or (d) By the Company, upon approval of the Board, if (i) Purchaser shall have (A) failed to commence the Offer within ten (10) Business Days following the date of this Agreement other than due to the occurrence of any of the events set forth in paragraph (d)(ii) of Annex A, (B) terminated the Offer, or the Offer shall have expired, without Purchaser having accepted any Shares for payment thereunder or (C) failed to accept Shares for payment pursuant to the Offer within 90 days following the commencement of the Offer, unless such action or inaction under (A), (B) or (C) shall have been caused by or resulted from the failure of the Company or any Selling Stockholder, as applicable, to perform, in any material respect, any of its material covenants or agreements contained in this Agreement or any Stockholder Agreement or the material breach by the Company or any Selling Stockholder of any of its material representations or warranties contained in this Agreement or any Stockholder Agreement or (ii) prior to the purchase of Shares pursuant to the Offer, the Board determines in good faith that it is required to do so by its fiduciary duties under applicable law after having received advice from outside legal counsel in order to enter into a definitive agreement with respect to a Superior Proposal, upon five (5) Business Days' prior written notice to Parent, setting forth in reasonable detail the identity of the person making, and the final terms and conditions of, the Superior Proposal and after duly considering any proposals that may be made by Parent during such five (5) Business Day period; provided, however, that any termination of this Agreement pursuant to this Section 9.01(d)(ii) shall not be effective until the Company has made full payment of all amounts provided under Section 9.03. SECTION 9.02. EFFECT OF TERMINATION. In the event of the termination of this Agreement pursuant to Section 9.01, this Agreement shall forthwith become void, and there shall be no liability on the part of any party hereto, except (a) as set forth in Section 9.03 and (b) nothing herein shall relieve any party from liability for any breach hereof prior to the date of such termination; provided, however, that the Confidentiality Agreement shall survive any termination of this Agreement. SECTION 9.03 FEES AND EXPENSES. (a) In the event that: (i) (A) any person (including, without limitation, the Company or any affiliate thereof), other than Parent or any affiliate of Parent, shall have become the beneficial owner of more than 15% of the then-outstanding Shares, (B) this Agreement shall have been terminated pursuant to Section 9.01(b)(i), 9.01(c) or 9.01(d) and (C) the Company enters into an agreement with respect to an Acquisition 47 Proposal or an Acquisition Proposal is consummated, in each case within 12 months after such termination of this Agreement; or (ii) any person shall have commenced, publicly proposed or communicated to the Company an Acquisition Proposal that is publicly disclosed and (A) the Offer shall have remained open for at least 20 Business Days, (B) the Minimum Condition shall not have been satisfied, and (C) this Agreement shall have been terminated pursuant to Section 9.01; or (iii) this Agreement is terminated (A) pursuant to (x) Section 9.01(c)(ii) or 9.01(d)(ii) or (y) Section 9.01(c)(i) or 9.01(d)(i), to the extent that the failure to commence, the termination or the failure to accept any Shares for payment, as set forth in Section 9.01(c)(i) or 9.01(d)(i), as the case may be, shall relate to the failure of the Company to perform, in any material respect, any of its material covenants or agreements contained in this Agreement or a material breach by the Company of any of its material representations or warranties contained in this Agreement and (B) the Company enters into an agreement with respect to an Acquisition Proposal or an Acquisition Proposal is consummated, in each case within 12 months after such termination of this Agreement; or (iv) an Acquisition Proposal that was commenced, publicly proposed or communicated to the Company prior to the termination of this Agreement pursuant to Section 9.01 is consummated within 12 months after the termination of this Agreement pursuant to Section 9.01, and the Company shall not theretofore have been required to pay the Fee to Parent pursuant to Section 9.03(a)(i), 9.03(a)(ii) or 9.03(a)(iii); then, in any such event, the Company shall pay Parent promptly (but in no event later than two (2) Business Days after the first of such events shall have occurred) a fee of One Million Four Hundred and Thirty-Two Thousand ($1,432,000) (the "Fee"), which amount shall be payable in immediately available funds. (b) Except as set forth in this Section 9.03, all costs and expenses incurred in connection with this Agreement, the Stockholder Agreement and the 48 Transactions shall be paid by the party incurring such expenses, whether or not any Transaction is consummated. (c) In the event that the Company shall fail to pay the Fee when due, the term "Fee" shall be deemed to include the costs and expenses actually incurred or accrued by Parent and Purchaser (including, without limitation, fees and expenses of counsel) in connection with the collection under and enforcement of this Section 9.03, together with interest on such unpaid Fee, commencing on the date that the Fee became due, at a rate equal to the rate of interest publicly announced by Citibank, N.A., from time to time, in the City of New York, as such bank's Base Rate plus 1%. SECTION 9.04. AMENDMENT. Subject to Section 7.03, this Agreement may be amended by the parties hereto by action taken by or on behalf of Parent and the respective Boards of Directors of Purchaser and the Company at any time prior to the Effective Time; provided, however, that, after the approval and adoption of this Agreement and the Transactions by the stockholders of the Company, no amendment may be made that would reduce the amount or change the type of consideration into which each Share shall be converted upon consummation of the Merger. This Agreement may not be amended except by an instrument in writing signed by each of the parties hereto. SECTION 9.05. WAIVER. Subject to Section 7.03, at any time prior to the Effective Time, any party hereto may (a) extend the time for the performance of any obligation or other act of any other party hereto, (b) waive any inaccuracy in the representations and warranties of any other party contained herein or in any document delivered pursuant hereto and (c) waive compliance with any agreement of any other party or any condition to its own obligations contained herein. Any such extension or waiver shall be valid if set forth in an instrument in writing signed by the party or parties to be bound thereby. ARTICLE X GENERAL PROVISIONS SECTION 10.01 NOTICES. All notices, requests, claims, demands and other communications hereunder shall be in writing and shall be given (and shall be deemed to have been duly given upon receipt) by delivery in person, by telecopy or by registered or certified mail (postage prepaid, return receipt requested) to the respective parties at the following addresses (or at such other address for a party as shall be specified in a notice given in accordance with this Section 10.01): if to Parent or Purchaser: 49 The Thomson Corporation Metro Center One Station Plaza Stamford, Connecticut 06902 Telecopier No: (203) 348-5718 Attention: General Counsel with a copy to: Torys 237 Park Avenue New York, New York 10017 Telecopier No: (212) 682-0200 Attention: Joseph J. Romagnoli, Esq. Email: jromagnoli@torys.com if to the Company: NewsEdge Corporation 80 Blanchard Road Burlington, MA 01803 Telecopier No: (781) 229-3030 Attention: President with a copy to: Testa Hurwitz Thibeault, LLP 125 High Street Boston, MA 02110-2704 Telecopier No: 617-790-0296 Attention: Lawrence S. Wittenberg, Esq. E-mail: wittenbe@tht.com SECTION 10.02. SEVERABILITY. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of law, or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the Transactions is not affected in any manner materially adverse to any party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the Transactions be consummated as originally contemplated to the fullest extent possible. 50 SECTION 10.03. ENTIRE AGREEMENT; ASSIGNMENT. This Agreement and Stockholder Agreement constitute the entire agreement among the parties with respect to the subject matter hereof and supersede all prior agreements and undertakings, both written and oral, among the parties, or any of them, with respect to the subject matter hereof. This Agreement shall not be assigned (whether pursuant to a merger, by operation of law or otherwise), except that Parent and Purchaser may assign all or any of their rights and obligations hereunder to any affiliate of Parent, provided that no such assignment shall relieve the assigning party of its obligations hereunder if such assignee does not perform such obligations. SECTION 10.04. PARTIES IN INTEREST. This Agreement shall be binding upon and inure solely to the benefit of each party hereto, and nothing in this Agreement, express or implied, is intended to or shall confer upon any other person any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement, other than Section 7.07 (which is intended to be for the benefit of the persons covered thereby and may be enforced by such persons). SECTION 10.05. SPECIFIC PERFORMANCE. The parties hereto agree that irreparable damage would occur in the event any provision of this Agreement were not performed in accordance with the terms hereof and that the parties shall be entitled to specific performance of the terms hereof, in addition to any other remedy at law or equity. SECTION 10.06. GOVERNING LAW. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware applicable to contracts executed in and to be performed in that State. The parties hereto hereby (a) submit to the non-exclusive jurisdiction of any state or federal court sitting in the City of Wilmington in the State of Delaware for the purpose of any Action arising out of or relating to this Agreement brought by any party hereto, and (b) irrevocably waive, and agree not to assert by way of motion, defense, or otherwise, in any such Action, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the Action is brought in an inconvenient forum, that the venue of the Action is improper, or that this Agreement or the Transactions may not be enforced in or by any of the above-named courts. SECTION 10.07. WAIVER OF JURY TRIAL. Each of the parties hereto hereby waives to the fullest extent permitted by applicable law any right it may have to a trial by jury with respect to any litigation directly or indirectly arising out of, under or in connection with this Agreement or the Transactions. Each of the parties hereto (a) certifies that no representative, agent or attorney of any other party has represented, expressly or otherwise, that such other party would not, in the event of litigation, seek to enforce that foregoing waiver and (b) acknowledges that it and the other hereto have been 51 induced to enter into this Agreement and the Transactions, as applicable, by, among other things, the mutual waivers and certifications in this Section 10.07. SECTION 10.08. HEADINGS. The descriptive headings contained in this Agreement are included for convenience of reference only and shall not affect in any way the meaning or interpretation of this Agreement. SECTION 10.09. COUNTERPARTS. This Agreement may be executed and delivered (including by facsimile transmission) in one or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. 52 IN WITNESS WHEREOF, Parent, Purchaser and the Company have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized. THE THOMSON CORPORATION By: /s/ Michael S. Harris ____________________________________ Name: Michael S. Harris Title: Senior Vice President, General Counsel and Secretary INFOBLADE ACQUISITION CORPORATION By: /s/ Kenneth Carson ____________________________________ Name: Kenneth Carson Title: Vice President NEWSEDGE CORPORATION By: /s/ Clifford M. Pollan ____________________________________ Name: Clifford M. Pollan Title: President and Chief Executive Officer 53 ANNEX A CONDITIONS TO THE OFFER Notwithstanding any other provision of the Offer, Purchaser shall not be required to accept for payment any Shares tendered pursuant to the Offer, if immediately prior to the expiration of the Offer, (i) the Minimum Condition shall not have been satisfied, (ii) any of the conditions in paragraphs (a), (b), (c), (e), (f), (g) and (i) below shall exist and be continuing or (iii) any of the conditions in paragraphs (d) and (h) below shall exist: (a) there shall have been instituted or be pending any Action (other than the Action set forth as item 1 in Section 4.09 of the Disclosure Schedule to the extent such Action has not resulted in a preliminary or permanent injunction with respect to this Agreement or any of the Transactions) before any Governmental Authority (i) challenging or seeking to make illegal, materially delay, or otherwise, directly or indirectly, restrain or prohibit the making of the Offer, the acceptance for payment of any Shares by Parent, Purchaser or any other affiliate of Parent, or the purchase of Shares pursuant to the Stockholder Agreement, or the consummation of any other Transaction, or seeking to obtain material damages in connection with any Transaction; (ii) seeking to prohibit or materially limit the ownership or operation by the Company, Parent or any of their subsidiaries of all or any of the business or assets of the Company, Parent or any of their subsidiaries that is material to either Parent and its subsidiaries or the Company and the Subsidiaries, in either case, taken as a whole, or to compel the Company, Parent or any of their subsidiaries, as a result of the Transactions, to dispose of or to hold separate all or any portion of the business or assets of the Company, Parent or any of their subsidiaries that is material to either Parent and its subsidiaries or the Company and the Subsidiaries, in each case, taken as a whole; (iii) seeking to impose any limitation on the ability of Parent, Purchaser or any other affiliate of Parent to exercise effectively full rights of ownership of any Shares, including, without limitation, the right to vote any Shares acquired by Purchaser pursuant to the Offer or any Stockholder Agreement or otherwise on all matters properly presented to the Company's stockholders, including, without limitation, the approval and adoption of this Agreement and the Transactions; (iv) seeking to require divestiture by Parent, Purchaser or any other affiliate of Parent of any Shares; or (v) which otherwise would prevent or materially delay consummation of the Offer or the Merger or would have a Material Adverse Effect; (b) there shall have been any statute, rule, regulation, legislation or interpretation enacted, promulgated, amended, issued or deemed applicable to (i) Parent, the Company or any subsidiary or affiliate of Parent or the Company or (ii) any Transaction, by any United States or Canadian legislative body or Governmental Authority with appropriate jurisdiction, the Stockholder Agreement or the Merger, that A-1 is reasonably likely to result, directly or indirectly, in any of the consequences referred to in clauses (i) through (v) of paragraph (a) above; (c) there shall have occurred any general suspension of trading in, or limitation on prices for, securities on the NASDAQ National Market (other than a shortening of trading hours or any coordinated trading halt triggered solely as a result of a specified increase or decrease in a market index); (d) (i) (A) it shall have been publicly disclosed, or Purchaser shall have otherwise learned, that beneficial ownership (determined for the purposes of this paragraph as set forth in Rule 13d-3 promulgated under the Exchange Act) of 15% or more of the then-outstanding Shares has been acquired by any person, other than Parent or any of its affiliates, and (B) the number of Shares validly tendered pursuant to the Offer and not withdrawn prior to the expiration of the Offer do not constitute a majority of the then outstanding Shares on a fully diluted basis (including, without limitation, all Shares issuable upon the conversion of any convertible securities or upon the exercise of any options, warrants or rights) or (ii) (A) the Board, or any committee thereof, shall have withheld, withdrawn, amended, changed or modified, in a manner adverse to Parent or Purchaser, the approval or recommendation of the Offer, the Agreement or approved or recommended any Acquisition Proposal or any other acquisition of Shares other than the Offer, the Merger or (B) the Board, or any committee thereof, shall have resolved to do any of the foregoing; provided, however, that if at any time after the commencement of the Offer, any of the foregoing events in this paragraph (d)(ii) has occurred, Purchaser may terminate the Offer at any time upon or after such occurrence; (e) any representation or warranty of the Company in the Agreement that is qualified as to materiality or Material Adverse Effect shall not be true and correct, or any such representation or warranty that is not so qualified shall not be true and correct in any material respect, in each case as if such representation or warranty was made as of such time on or after the date of this Agreement ; provided, however, that this condition shall be deemed to exist only if the failure of such representations and warranties to be true and correct (to the extent provided above in this paragraph (e)), individually or in the aggregate, has had or would reasonably be expected to have a Material Adverse Effect; (f) (i) the Company shall have failed to perform, in any material respect, any obligation or to comply, in any material respect, with any agreement or covenant of the Company to be performed or complied with by it under the Agreement, or (ii) the Selling Stockholders shall have failed to perform, in any material respect, any obligation or to comply, in any material respect, with any agreement or covenant of the Selling Stockholders to be performed or complied with by them under the Stockholder Agreement if any such failure adversely impacts the Offer or any of the Transactions; (g) any Company Indebtedness exists; (h) this Agreement shall have been terminated in accordance with its terms; or (i) Purchaser and the Company shall have agreed that Purchaser shall terminate the Offer or postpone the acceptance for payment of Shares. The foregoing conditions are for the sole benefit of Purchaser and Parent and may be asserted by Purchaser or Parent regardless of the circumstances giving rise to any such condition or may be waived by Purchaser or Parent in whole or in part at any time and from time to time in their sole discretion. The failure by Parent or Purchaser at any time to exercise any of the foregoing rights shall not be deemed a waiver of any such right; the waiver of any such right with respect to particular facts and other circumstances shall not be deemed a waiver with respect to any other facts and circumstances; and each such right shall be deemed an ongoing right that may be asserted at any time and from time to time. SCHEDULE I - SELLING STOCKHOLDERS Basil P. Regan Donald L. McLagan Clifford Pollan William A. Devereaux Michael E. Kolowich Murat H. Davidson, Jr. Rory J. Cowan Peter Woodward Ronald Benanto James D. Daniell SCHEDULE II - OFFICERS Clifford Pollan Ronald Benanto Charles White Thomas Karanian Alton Zink David Scott John Crozier Lee Phillips EX-99.E2 4 a2057464zex-99_e2.txt EXHIBIT 99.E.2 STOCKHOLDERS AGREEMENT STOCKHOLDERS AGREEMENT dated as of August 6, 2001 (this "Agreement"), among THE THOMSON CORPORATION, a corporation incorporated under the laws of the Province of Ontario ("Parent"), INFOBLADE ACQUISITION CORPORATION, a Delaware corporation and an indirect wholly owned subsidiary of Parent ("Purchaser"), and each of the parties identified on Schedule I hereto (each, a "Stockholder" and, collectively, the "Stockholders"), as individual stockholders of NEWSEDGE CORPORATION, a Delaware corporation (the "Company"), W I T N E S S E T H: WHEREAS, the Purchaser wishes to commence an offer to all stockholders of the Company to tender their shares of Common Stock, par value $0.01, of the Company for the offer price of $2.30 per share of Common Stock (the "Offer"); WHEREAS, concurrently with the execution of this Agreement, Parent and Purchaser are entering into an Agreement and Plan of Merger dated as of the date hereof (the "Merger Agreement"; capitalized terms used and not otherwise defined herein shall have the respective meanings assigned to them in the Merger Agreement) with the Company, pursuant to which (i) Purchaser will commence the Offer, and (ii) following consummation of the Offer, Purchaser shall merge with and into the Company; WHEREAS, as a condition to entering into the Merger Agreement and incurring the obligations set forth therein, including the Offer, Parent and Purchaser have required that each of the Stockholders enter into this Agreement in order to provide for the tender of their respective Shares (as defined below) to the Offer and the voting of such Shares at any meeting of the stockholders of the Company in favor of the approval and adoption of the Merger Agreement, the Merger and all the transactions contemplated by the Merger Agreement and otherwise in such manner as may be necessary to consummate the Merger; and WHEREAS, the Stockholders believe that it is in the best interests of the Company and its stockholders to induce Parent and Purchaser to enter into the Merger Agreement and, therefore, the Stockholders are willing to enter into this Agreement. NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements contained herein, and intending to be legally bound hereby, the parties hereto agree as follows: ARTICLE I TENDER OF SHARES; OPTIONS SECTION 1.01. TENDER OF SHARES. Each Stockholder, severally but not jointly, agrees that, as soon as practicable following commencement of the Offer, such Stockholder shall tender or cause to be tendered all of such Stockholder's respective Shares (as defined below) pursuant to and in accordance with the terms of the Offer, and shall not withdraw such Shares from the Offer unless the Offer is terminated. Each Stockholder, severally but not jointly, acknowledges and agrees that Purchaser's obligation to accept for payment the shares of Common Stock in the Offer, including any Shares tendered by such Stockholder, is subject to the terms and conditions of the Offer. For the purposes of this Agreement "Shares" shall mean: (i) all shares of Common Stock of the Company and all such shares of Common Stock issuable upon the exercise or conversion of options, warrants and other rights to acquire shares of Common Stock (other than those which are cancelled in accordance with Sections 3.07 and 3.08 of the Merger Agreement or Section 1.02 hereof) owned of record and /or beneficially by each Stockholder as of the date of this Agreement; and (ii) all additional shares of Common Stock of the Company (including any shares of Common Stock received as a result of a stock split, recapitalization, combination, exchange of shares or the like) and all additional such shares of Common Stock issuable upon the exercise or conversion of additional options, warrants and other rights to acquire shares of Common Stock of the Company (other than those which are cancelled in accordance with Sections 3.07 and 3.08 of the Merger Agreement or Section 1.02 hereof) which each Stockholder acquires ownership of, of record and/or beneficially, during the period from the date of this Agreement through the termination of the Offer. When used with respect to any Share, the "beneficial ownership" thereof or similar terms means the power to vote or dispose of, or direct the voting or disposition of, such Share. Each Stockholder hereby agrees, while this Agreement is in effect, to promptly notify Parent and Purchaser of the number of any new Shares acquired by such Stockholder, if any, after the date hereof. SECTION 1.02. OPTIONS. Each Stockholder, severally but not jointly, agrees, subject to the terms and conditions of the Merger Agreement, to the cancellation of each outstanding option and/or warrant to purchase shares of Common Stock of the Company held by such Stockholder as set forth on Schedule I hereto, in exchange for the consideration, if any, described in Sections 3.07 and 3.08 of the Merger Agreement. ARTICLE II VOTING AGREEMENT SECTION 2.01. VOTING AGREEMENT. Each Stockholder, severally but not jointly, hereby agrees that, from and after the date hereof and until the Expiration Date, at any meeting of the stockholders of the Company, however called, and in any action by consent of the stockholders of the Company, such Stockholder shall vote (or cause to be voted) such Stockholder's Shares (i) in favor of the approval and adoption of the Merger Agreement, the Merger and all the transactions contemplated by the Merger Agreement and this Agreement and otherwise in such manner as may be necessary to consummate the Merger; (ii) except as otherwise agreed to in writing by Parent, against any action, proposal, agreement or transaction that would result in a breach of any covenant, obligation, agreement, representation or warranty of the Company under the Merger Agreement or of the Stockholder contained in this Agreement; and (iii) against (A) any action, agreement or transaction that would impair or materially delay the ability 2 of the Company to consummate the transactions provided for in the Merger Agreement or (B) any Acquisition Proposal. SECTION 2.02. IRREVOCABLE PROXY. Each Stockholder hereby irrevocably appoints Parent and each of Parent's executive officers as such Stockholder's true and lawful attorney, agent and proxy, to vote and otherwise act (by written consent or otherwise) with respect to such Stockholder's Shares at any meeting of stockholders of the Company (whether annual or special and whether or not an adjourned or postponed meeting) or by written consent in lieu of any such meeting or otherwise, on the matters and in the manner specified in Section 2.01, giving and granting to such Stockholder's attorney, agent and proxy the full power and authority to do and perform each and every act and thing whether necessary or desirable to be done in and about the premises, as fully as it might or could do if personally present with full power of substitution, appointment and revocation, hereby ratifying and confirming all that such Stockholder's attorney, agent and proxy shall do or cause to be done by virtue hereof (the "Irrevocable Proxy"). THIS PROXY AND POWER OF ATTORNEY ARE IRREVOCABLE (UNTIL THE EXPIRATION DATE) AND COUPLED WITH AN INTEREST AND, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, SHALL BE VALID AND BINDING ON ANY PERSON TO WHOM A STOCKHOLDER MAY TRANSFER ANY OF SUCH STOCKHOLDER'S SHARES IN BREACH OF THIS AGREEMENT. Each Stockholder hereby revokes all other proxies and powers of attorney with respect to such Stockholder's Shares that may have heretofore been appointed or granted, and no subsequent proxy or power of attorney shall be given or written consent executed (and if given or executed, shall not be effective) by any Stockholder with respect thereto prior to the Expiration Date. All authority herein conferred or agreed to be conferred shall survive the death or incapacity of any Stockholder and the termination of the Irrevocable Proxy and any obligation of the Stockholder under this Agreement shall be binding upon the heirs, personal representatives, successors and assigns of such Stockholder. This proxy shall terminate on the Expiration Date. SECTION 2.03. CONFLICTS. In the case of any Stockholder who is a director of the Company, no provision of this Agreement, including Section 5.02 hereof, shall prevent or interfere with such Stockholder's performance of such Stockholder's obligations, if any, solely in such Stockholder's capacity as a director of the Company, including, without limitation, the fulfillment of such Stockholder's fiduciary duties, and in no event shall such performance constitute a breach of this Agreement. ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS Each Stockholder, severally but not jointly, hereby represents and warrants to Parent and Purchaser as follows: SECTION 3.01. LEGAL CAPACITY. Such Stockholder has all legal capacity to enter into this Agreement, to carry out such Stockholder's obligations hereunder and to consummate the transactions contemplated hereby. 3 SECTION 3.02. AUTHORITY RELATIVE TO THIS AGREEMENT. Each Stockholder has all necessary right, power and authority to execute and deliver this Agreement, to perform such Stockholder's obligations hereunder and to consummate the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by such Stockholder and constitutes a legal, valid and binding obligation of such Stockholder, enforceable against such Stockholder in accordance with its terms. SECTION 3.03. NO CONFLICT. (a) The execution and delivery of this Agreement by such Stockholder do not, and the performance of this Agreement by such Stockholder shall not, (i) conflict with or violate its organizational documents, if applicable, (ii) to the knowledge of such Stockholder, conflict with or violate any Law applicable to such Stockholder (in such Stockholder's capacity as a Stockholder) or by which the Shares of such Stockholder are bound or affected or (iii) result in any breach of, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, or result in the creation of a Lien on any of the Shares of such Stockholder pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise, judgment, injunction, order, decree or other instrument or obligation to which such Stockholder is a party or by which such Stockholder or the Shares of such Stockholder are bound or affected, except for any such conflicts, violations, breaches, defaults or other occurrences that would not prevent or materially delay consummation of the transactions contemplated by this Agreement or otherwise prevent or materially delay such Stockholder from performing its obligations under this Agreement. (b) To the knowledge of such Stockholder, the execution and delivery of this Agreement by such Stockholder do not, and the performance of this Agreement by such Stockholder shall not, require any consent, approval, authorization or permit of, or filing with or notification to, any Governmental Authority, except (i) for applicable requirements, if any, of the Exchange Act, and (ii) where the failure to obtain such consents, approvals, authorizations or permits, or to make such filings or notifications, would not prevent or materially delay consummation of the transactions contemplated by this Agreement or otherwise prevent or materially delay such Stockholder from performing its obligations under this Agreement. SECTION 3.04. TITLE TO THE SHARES. As of the date hereof, such Stockholder is the sole record and/or beneficial owner of, and has good and unencumbered title to, the number of shares of Common Stock and/or the options and/or warrants to purchase shares of Common Stock set forth in respect of such Stockholder on Schedule I hereto. Such Shares are all the securities of the Company owned, either of record and/or beneficially, by such Stockholder and such Stockholder does not have any option or other right to acquire any other securities of the Company. The Shares owned by such Stockholder are owned free and clear of all Liens, other than any Liens created by this Agreement. Except as provided in this Agreement, such Stockholder has not appointed or granted any proxy, which appointment or grant is still effective, with respect to the Shares owned by such Stockholder and none of the Shares owned of record and/or 4 beneficially by such Stockholder are subject to any voting trust or other agreement or arrangement with respect to the voting of such Shares. SECTION 3.06. INTERMEDIARY FEES. No investment banker, broker, finder or other intermediary is, or shall be, entitled to a fee or commission from Parent, Purchaser or the Company in respect of this Agreement based on any arrangement or agreement made by or, to the knowledge of the Stockholder, on behalf of such Stockholder. ARTICLE IV REPRESENTATIONS AND WARRANTIES OF PARENT AND PURCHASER Parent and Purchaser hereby, jointly and severally, represent and warrant to each Stockholder as follows: SECTION 4.01. CORPORATE ORGANIZATION. Each of Parent and Purchaser is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has the requisite corporate power and authority and all necessary governmental approvals to own, lease and operate its properties and to carry on its business as it is now being conducted, except where the failure to be so organized, existing or in good standing or to have such power, authority and governmental approvals would not prevent or materially delay consummation of the transactions contemplated by this Agreement or otherwise prevent or materially delay Parent or Purchaser from performing their respective obligations under this Agreement. SECTION 4.02. AUTHORITY RELATIVE TO THIS AGREEMENT. Each of Parent and Purchaser has all necessary corporate power and authority to execute and deliver this Agreement and to perform its obligations hereunder. The execution and delivery of this Agreement by Parent and Purchaser and the performance by Parent and Purchaser of their obligations hereunder have been duly and validly authorized by all necessary corporate action and no other corporate proceedings on the part of Parent or Purchaser are necessary to authorize this Agreement. This Agreement has been duly and validly executed and delivered by Parent and Purchaser and, assuming due authorization, execution and delivery by each of the Stockholders, constitutes a legal, valid and binding obligation of each of Parent and Purchaser enforceable against each of Parent and Purchaser in accordance with its terms. SECTION 4.03. NO CONFLICT; REQUIRED FILINGS AND CONSENTS. (a) The execution and delivery of this Agreement by Parent and Purchaser do not, and the performance of this Agreement by Parent and Purchaser shall not, (i) conflict with or violate the Certificate of Incorporation or By-laws of Parent or Purchaser and (ii) conflict with or violate any Law applicable to Parent or Purchaser, except any such conflicts or violations that would not prevent or materially delay consummation of the transactions contemplated by this Agreement or otherwise prevent or materially delay Parent or Purchaser from performing its obligations under this Agreement. 5 (b) The execution and delivery of this Agreement by Parent and Purchaser do not, and the performance of this Agreement by Parent and Purchaser shall not, require any consent, approval, authorization or permit of, or filing with, or notification to, any Governmental Authority, except (i) for applicable requirements, if any, of the Exchange Act, and (ii) where the failure to obtain such consents, approvals, authorizations or permits, or to make such filings or notifications, would not prevent or materially delay consummation of the transactions contemplated by this Agreement or otherwise prevent or materially delay Parent or Purchaser from performing its obligations under this Agreement. ARTICLE V COVENANTS OF THE STOCKHOLDERS SECTION 5.01. NO PROXY, DISPOSITION OR ENCUMBRANCE OF SHARES. Each Stockholder, severally but not jointly, hereby agrees that, except as contemplated by this Agreement or with the prior written consent of Parent, such Stockholder shall not, prior to the Expiration Date, (i) grant any proxies or voting rights or enter into any voting trust or other agreement or arrangement with respect to the voting of any Shares of such Stockholder, (ii) sell, assign, transfer, encumber, pledge or hypothecate or otherwise dispose of, or enter into any contract, option or other arrangement or understanding with respect to the direct or indirect sale, assignment, transfer, encumbrance, pledge, hypothecation or other disposition of, any such Shares or interest therein, or create or permit to exist any Liens of any nature whatsoever with respect to, any of such Shares, (iii) take any action that would make any representation or warranty of such Stockholder herein untrue or incorrect or have the effect of preventing or materially impairing such Stockholder from performing such Stockholder's obligations hereunder, (iv) directly or indirectly, initiate, solicit or encourage any person to take actions that could reasonably be expected to lead to the occurrence of any of the foregoing or (v) agree or consent to, or offer to do, any of the foregoing. SECTION 5.02. NO SOLICITATION OF TRANSACTIONS. Subject to Section 2.03 hereof, each Stockholder, severally and not jointly, agrees that between the date of this Agreement and the Expiration Date, such Stockholder shall not, directly or indirectly, (i) solicit, initiate or take any action intended to encourage the submission of any Acquisition Proposal, or (ii) participate in any discussions or negotiations regarding, or furnish to any person, any information with respect to, or otherwise cooperate in any way with respect to, or assist or participate in, or take any action intended to facilitate or encourage, any proposal that constitutes, or may reasonably be expected to lead to, an Acquisition Proposal. SECTION 5.03. FURTHER ACTION; REASONABLE BEST EFFORTS. Upon the terms and subject to the conditions hereof, Parent, Purchaser and each Stockholder shall use their reasonable best efforts to take, or cause to be taken, all appropriate action, and to do, or cause to be done, all things necessary, proper or advisable under applicable Laws to consummate and make effective this Agreement and the transactions contemplated hereby. 6 SECTION 5.04. DISCLOSURE. Each Stockholder agrees to permit Parent and Purchaser to publish and disclose in the Offer Documents, Proxy Statement and related filings under the securities laws such Stockholder's identity and ownership of such Stockholder's Shares and the nature of such Stockholder's commitments, arrangements and understandings under this Agreement. ARTICLE VI MISCELLANEOUS SECTION 6.01. TERMINATION. This Agreement shall terminate, and no party shall have any rights or obligations hereunder and this Agreement shall become null and void and have no further effect upon the earlier to occur of (i) such date and time as the Merger Agreement shall have been validly terminated pursuant to Article IX thereof and (ii) the Effective Time (the "Expiration Date"). Nothing in this Section 6.01 shall relieve any party of liability for any willful breach of this Agreement. Parent and Purchaser acknowledge that, in the event of termination of this Agreement, Stockholders shall no longer have the obligation to tender, and may withdraw, their Shares. Parent acknowledges and agrees that this Agreement shall not be binding upon any Stockholder in the event that the Merger Agreement shall be amended by the parties thereto to lower or change the form of consideration set forth in the definition of Merger Consideration (as defined in the Merger Agreement). SECTION 6.02. AMENDMENT. This Agreement may not be amended except by an instrument in writing signed by all the parties hereto. SECTION 6.03. WAIVER. Any party to this Agreement may (i) extend the time for the performance of any obligation or other act of any other party hereto, (ii) waive any inaccuracy in the representations and warranties of another party contained herein or in any document delivered pursuant hereto and (iii) waive compliance with any agreement of another party contained herein. Any such extension or waiver shall be valid if set forth in an instrument in writing signed by the party or parties to be bound thereby. SECTION 6.04. NOTICES. All notices, requests, claims, demands and other communications hereunder shall be in writing and shall be given (and shall be deemed to have been duly given upon receipt) by delivery in person, by telecopy, or by registered or certified mail (postage prepaid, return receipt requested) to the Parent or Purchaser specified below, or specified (in the case of each Stockholder) adjacent to each Stockholder's name in Schedule I: if to Parent or Purchaser: The Thomson Corporation Metro Center, One Station Plaza Stamford, CT 06902 Telecopy: (203) 348-5718 Attention: General Counsel 7 with a copy to: Torys 237 Park Avenue New York, New York 10017 Telecopy: (212) 682-0200 Attention: Joseph J. Romagnoli, Esq. SECTION 6.05. SEVERABILITY. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated by this Agreement is not affected in any manner materially adverse to any party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated by this Agreement be consummated as originally contemplated to the fullest extent possible. SECTION 6.06. ASSIGNMENT. This Agreement shall not be assigned by operation of Law or otherwise, except that Parent and Purchaser may assign all or any of their rights and obligations hereunder to any affiliate of Parent, provided that no such assignment shall relieve Parent or Purchaser of its obligations hereunder if such assignee does not perform such obligations. SECTION 6.07. PARTIES IN INTEREST. This Agreement shall be binding upon and inure solely to the benefit of each party hereto, and nothing in this Agreement, express or implied, is intended to or shall confer upon any other person any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement. SECTION 6.08. SPECIFIC PERFORMANCE. The parties hereto agree that irreparable damage would occur in the event any provision of this Agreement were not performed in accordance with the terms hereof and that the parties shall be entitled to specific performance and injunctive and other equitable relief to enforce the performance of this Agreement in addition to any other remedy at law or in equity. SECTION 6.09. GOVERNING LAW. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware applicable to contracts executed in and to be performed in that State. SECTION 6.10. WAIVER OF JURY TRIAL. Each of the parties hereto hereby waives to the fullest extent permitted by applicable law any right it may have to a trial by jury with respect to any actions or proceedings directly or indirectly arising out of, under or in connection with this Agreement. SECTION 6.11. EXPENSES. Except as otherwise specified in this Agreement, all costs and expenses, including, without limitation, fees and disbursements 8 of counsel, financial advisors and accountants, incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs and expenses. SECTION 6.12. HEADINGS. The descriptive headings contained in this Agreement are included for convenience of reference only and shall not affect in any way the meaning or interpretation of this Agreement. SECTION 6.13. COUNTERPARTS. This Agreement may be executed and delivered (including by facsimile transmission) in one or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. 9 IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the day and year first above written. /s/ Stockholder ---------------------------------- Name: Name of Stockholder THE THOMSON CORPORATION By: /s/ Michael S. Harris ---------------------------------- Name: Michael S. Harris Title: Senior Vice President, General Counsel and Secretary INFOBLADE ACQUISITION CORPORATION By: /s/ Kenneth Carson ---------------------------------- Name: Kenneth Carson Title: Vice President 10 SCHEDULE I
NAME AND ADDRESS COMMON STOCK OPTIONS WARRANTS TOTAL SHARES - ---------------- ------------ ------- -------- ------------ Ronald R. Benanto 9,412 300,000 5,333 314,745
SCHEDULE I
NAME AND ADDRESS COMMON STOCK OPTIONS WARRANTS TOTAL SHARES - ---------------- ------------ ------- -------- ------------ Rory J. Cowan 70,294 32,500 20,000 122,794
SCHEDULE I
NAME AND ADDRESS COMMON STOCK OPTIONS WARRANTS TOTAL SHARES - ---------------- ------------ ------- -------- ------------ James Daniell 6,500 25,000 -- 31,500
SCHEDULE I
Name and Address Common Stock Options Warrants Total Shares - ---------------- ------------ ------- -------- ------------ Murat H. Davidson, Jr. 87,224 20,000 26,666 133,890
SCHEDULE I
Name and Address Common Stock Options Warrants Total Shares - ---------------- ------------ ------- -------- ------------ William A. Devereaux 230,556 56,001 -- 286,557
SCHEDULE I
NAME AND ADDRESS COMMON STOCK OPTIONS WARRANTS TOTAL SHARES - ---------------- ------------ ------- -------- ------------ Michael Kolowich 105,861 -- 8,000 113,861
SCHEDULE I
NAME AND ADDRESS COMMON STOCK OPTIONS WARRANTS TOTAL SHARES - ---------------- ------------ ------- -------- ------------ Donald McLagan 1,707,557 -- -- 1,707,557 40 Plympton Road Sudbury, MA Marnie Elizabeth 221,221 -- -- 221,221 McLagan Trust of 1993 Christopher R. McLagan 221,221 -- -- 221,221 Trust of 1993
SCHEDULE I
NAME AND ADDRESS COMMON STOCK OPTIONS WARRANTS TOTAL SHARES - ---------------- ------------ ------- -------- ------------ Clifford M. Pollan 127,744 845,500 5,333 978,577
SCHEDULE I
NAME AND ADDRESS COMMON STOCK OPTIONS WARRANTS TOTAL SHARES - ---------------- ------------ ------- -------- ------------ Basil P. Regan 90,729 20,000 13,333 124,062 Regan Partners,L.P. 3,172,382 173,333 3,345,715 600 Madison Avenue 26th Floor New York, NY 10022 Regan International 1,225,000 -- 73,333 1,298,333 Fund Ltd. 600 Madison Avenue 26th Floor New York, NY 10022 Wellcome Trust-JD84 445,588 -- 153,333 598,921 600 Madison Avenue 26th Floor New York, NY 10022 Deutsche Daiwa 353,500 -- -- 353,500 Super Hedge Fund 600 Madison Avenue 26th Floor New York, NY 10022
SCHEDULE I
NAME AND ADDRESS COMMON STOCK OPTIONS WARRANTS TOTAL SHARES - ---------------- ------------ ------- -------- ------------ Peter Woodward 6,000 20,000 -- 26,000
EX-99.E3 5 a2057464zex-99_e3.txt EXHIBIT 99.E.3 [BROADVIEW LETTERHEAD] May 16, 2001 CONFIDENTIAL Mr. David Hanssens Vice President Corporate Development West Group 610 Opperman Drive PO Box 64526 Eagan, MN 55123 Dear Mr. Hanssens: In connection with your consideration of a possible transaction with NewsEdge Corporation (the "Company"), you have requested financial and other information concerning the business and affairs of the Company. As a condition to the Company's furnishing to you and your representatives financial and other information which has not theretofore been made available to the public, you agree to treat all such non-public information furnished to you in writing or orally by the Company or its representatives on and after the date of this agreement (herein collectively referred to as the "evaluation material"), as follows: (1) You recognize and acknowledge the competitive value and confidential nature of the evaluation material and the damage that could result to the Company if information contained therein is disclosed to any third party. You also recognize and acknowledge that the evaluation material is being provided to you in reliance upon your acceptance of the terms of this agreement. (2) You agree that the evaluation material will be used solely for the purpose of evaluating the proposed transaction. You also agree that you, your directors, officers, employees and agents and representatives of your advisors, herein collectively referred to as "your representatives," will not disclose or permit the disclosure of any of the evaluation material now or hereafter received or obtained from the Company or its representatives to any third party or otherwise use or permit the use of the evaluation material in any way detrimental to the Company, except as required by applicable law or legal process, without the prior written consent of the Company, provided, however, that any such information may be disclosed to such of your representatives who need to know such information for the purpose of evaluating the proposed transaction and who are advised of this agreement and agree to keep such [BROADVIEW LOGO] Mr. David Hanssens May 16, 2001 Page 2 information confidential and to be bound by this agreement to the same extent as if they were parties hereto, it being understood that you shall be responsible for any breach of this agreement by your representatives. (3) In the event that the transaction contemplated by this agreement is not consummated, neither you nor any of your representatives shall, without prior written consent of the Company, use any of the evaluation material now or hereafter received or obtained from the Company or its representatives for any purpose. (4) In the event that the transaction contemplated by this agreement is not consummated, all evaluation material (and all copies, summaries, and notes of the contents or parts thereof) shall be returned upon the Company's request or destroyed and not retained by you or your representatives in any form or for any reason. (5) You and your representatives shall have no obligation hereunder with respect to any information in the evaluation materials to the extent that such information has been made publicly available nor any obligation with respect to information which can be demonstrated by you to be already properly in your possession on a non-confidential basis from sources other than the Company, or its representatives other than by acts by you or your representatives in violation of this agreement. (6) You are aware, and will advise your representatives who are informed of the matters that are the subject of this Agreement, of the restrictions imposed by the United States securities laws on the purchase or sale of securities by any person who has received material, non-public information from the Company and on the communication of such information to any other person who may purchase or sell such securities in reliance upon such information. You and your representatives will comply with all applicable securities laws in connection with the purchase or sale, directly or indirectly, of securities of the Company for as long as you or your representatives are in possession of material non-public information about the Company. (7) This agreement shall be governed by the laws of the Commonwealth of Massachusetts applicable to agreements made and to be performed within. It is further agreed that the intention of NewsEdge Corporation to engage in these discussions, and the subsequent exercise of that intention shall be kept confidential by you. [BROADVIEW LOGO] Mr. David Hanssens May 16, 2001 Page 3 Acceptance of the above terms shall be indicated by having this letter countersigned on your behalf and returning one original to Broadview. Sincerely, BROADVIEW INTERNATIONAL LLC For: NewsEdge Corporation By: /s/ Rodd Langenhagen ------------------------------ Rodd Langenhagen Received and consented to this 17th day of May, 2001. WEST GROUP By: /s/ David Hanssens ------------------------------ David Hanssens EX-99.E4 6 a2057464zex-99_e4.txt EXHIBIT 99.E.4 AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT This Amended and Restated Executive Employment Agreement (this "Agreement") dated as of August 6, 2001 is by and between NEWSEDGE CORPORATION (the "Company"), a Delaware corporation having its principal executive offices at 80 Blanchard Road, Burlington, Massachusetts, and Cliff Pollan (the "Executive"). WHEREAS, THE THOMSON CORPORATION ("Parent") proposes to acquire the Company pursuant to that certain Agreement and Plan of Merger dated as of August 6, 2001 ("Merger Agreement") by and among the Company, Parent and INFOBLADE ACQUISITION CORPORATION ("Purchaser"); and WHEREAS, the Executive currently serves as President and Chief Executive Officer of the Company pursuant to an Amended and Restated Executive Employment Agreement dated as of April 1, 2001 (the "Original Employment Agreement") between the Company and the Executive; and WHEREAS, the Company and the Executive desire to amend and restate the Original Employment Agreement in its entirety as of the date hereof and to provide for the employment of Executive by the Company from and after the Effective Date (as hereinafter defined) in accordance with the terms hereof. NOW, THEREFORE, in consideration of the terms, conditions, and mutual covenants hereinafter contained, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto do hereby agree to amend and restate the Original Employment Agreement in its entirety as follows: 1. EFFECTIVENESS; EMPLOYMENT OF EXECUTIVE; TERM. (A) EFFECTIVENESS. The terms and conditions of this Agreement shall become effective automatically, without further act or deed by the Executive or the Company, on the date hereof and the Original Employment Agreement is hereby superseded in its entirety and of no further force and effect, provided, however, that notwithstanding the foregoing, in the event that the Merger Agreement is terminated prior to the Effective Time (as defined in the Merger Agreement), this Agreement shall automatically terminate and have no further force or effect and the Original Employment Agreement shall be automatically reinstated upon such termination of the Merger Agreement. (B) EMPLOYMENT. Subject to the terms and conditions of this Agreement, during the Term (as hereinafter defined), the Company agrees to employ the Executive, and the Executive agrees to serve, as the Company's President and Chief Executive Officer, reporting to the President and Chief Executive Officer of Dialog (the Executive's "Supervisor") and having such powers and duties consistent with his position as may reasonably be assigned to him from time to time. (C) COMMITMENT. The Executive represents that he is not currently party to or bound by any commitments that might interfere with or impair his performance of such duties and responsibilities or that are inconsistent with his obligations hereunder. The Executive will devote such time and attention to his duties and responsibilities hereunder as reasonably are required, and will not undertake any commitments that would interfere with or impair his performance of such duties and responsibilities. TERM. The term of the Executive's employment under this Agreement shall commence on the Effective Date (as defined in Section 4 below) and shall terminate on the one-year anniversary date of the Effective Date, unless sooner terminated in accordance with Section 3 of this Agreement (the "Term"). Upon the expiration of the Term, the Executive's employment with the Company shall be "at will" and such Executive's employment may be terminated by the Company at any time upon or after such expiration with or without cause, and that upon such termination the Executive shall have no rights under this Agreement including, without limitation, any right to any severance or other termination payments. 2. COMPENSATION. During the Term of the Executive's employment with the Company hereunder, the Company will compensate the Executive as follows: (A) SALARY. The Company will pay to the Executive a base salary, payable in accordance with the payroll practices of the Company, at the rate of $275,000 per annum. The Executive's base salary shall be subject to annual review by the Company and Parent. (B) PERFORMANCE BONUSES. The Executive will be eligible to receive an annual cash bonus at an annualized rate of up to 40% of his base salary, based on the achievement of reasonable individual and Company performance targets to be established by the Company and Parent. (C) STAY BONUS. If the Executive is an active employee of the Company on the one-year anniversary (the "Anniversary Date") of the Effective Date, the Executive will be paid a bonus equal to $365,000. (D) BENEFITS. The Company will promptly reimburse all out-of-pocket expenses reasonably incurred by the Executive in the course of performing his employment duties and responsibilities hereunder, subject to receipt of appropriate documentation. The Company will also provide consistent with his position, Company-paid health and life insurance, and with such other fringe benefits as it from time to time may make generally available to its other senior executives at the Executive's level. 3. TERMINATION. (A) EVENTS CAUSING TERMINATION. The Executive's employment hereunder will terminate upon the occurrence of any of the following events: (1) The Executive's death, or a determination of his legal incapacity by a court of competent jurisdiction; (2) The termination of the Executive's employment hereunder by the Company, by written notice to the Executive, upon the Executive's inability due -2- to illness or injury to perform the essential functions of his position with or without reasonable accommodation; (3) The termination of the Executive's employment hereunder by the Company, for Cause, by written notice to the Executive; (4) The termination of the Executive's employment hereunder by the Company, without Cause, by written notice to the Executive; (5) The termination of the Executive's employment hereunder by the Executive, for Good Reason, by thirty (30) days prior written notice to the Company; or (6) The expiration of the Term of this Agreement under Section 1(D) hereof. (B) "CAUSE" AND "GOOD REASON" DEFINED. For purposes of this Agreement: "Cause" means: (a) the Executive's conviction of any crime (whether or not involving the Company) (other than unintentional motor vehicle felonies); (b) any act of theft, fraud or embezzlement by the Executive in connection with his work with the Company; or (c) the Executive's continuing, repeated and willful failure or refusal to perform, or continuing, repeated and gross negligence in the performance of, his material duties and services to the Company (other than due to his incapacity due to illness or injury), provided that such failure or refusal or gross negligence continues uncorrected for a period of 30 days after the Executive shall have received written notice from the Company setting forth with specificity the nature of such failure, refusal, or gross negligence; (d) the breach of this Agreement by the Executive; or (e) the willful violation of Federal and/or state securities laws. "GOOD REASON" means the occurrence of one or more of the following occurring without the specific written consent of the Executive: (i) a material reduction of duties of the Executive, excluding any such reduction in duties reasonably occurring as a result of the transactions contemplated by the Merger Agreement; (ii) a material demotion, or a reduction in base salary of the Executive; (iii) any requirement that the Executive's principal place of work be relocated outside of the Commonwealth of Massachusetts or more than twenty-five (25) miles from its location as of the date of this Agreement; (iv) the Company's breach of any term of this Agreement which is not fully remedied within fifteen (15) calendar days after receipt by the Company of a written notice from the Executive of such breach. (C) ADJUSTMENTS UPON TERMINATION. Notwithstanding any other provision of this Agreement: (1) If the Executive's employment with the Company terminates during the Term pursuant Section 3(A)(4) (by the Company, without Cause) or Section 3(A)(5) (by the Executive, for Good Reason), then, for a twelve (12) month period immediately following the date of such termination, the Company will continue to pay the Executive a base salary at a rate equal to that at which he was being paid at the time of termination and will pay the Executive an amount equal to the maximum amount of the Executive's bonus pursuant to Section 2(B) hereof as of the date of such termination payable in twelve (12) equal monthly -3- installments, and (subject to Section 3(D) below), will likewise continue to provide the Executive with the benefits that he was receiving at the time of termination (or, if the Company is unable to do so because such benefits may only be provided to current employees, subject to the provisions of Section 3(D) it will provide the Executive with the cash value thereof). In addition to the payments and benefits specified above, the Company will pay the Executive on the date of termination a lump sum payment for all accrued unused vacation time. It is agreed and understood that the Company's duty to make the payments and provide the benefits described in this Section 3(C)(1) shall be conditioned upon the Executive's execution of a satisfactory general release in favor of the Company and the Executive's compliance with Section 5 hereof. (2) If the Executive's employment with the Company terminates during the Term other than pursuant to Section 3(A)(4) (by the Company, without Cause) or Section 3(A)(5) (by the Executive, with Good Reason), then the rights of the Executive to receive future compensation pursuant to Section 2 and Section 3(C)(1) hereof, and all other rights of the Executive hereunder, will cease as of the date of such termination except as may be required by law. As of the date of such termination, the Executive shall receive a lump sum payment for all accrued unpaid wages and accrued unused vacation time. (D) NO DUTY TO MITIGATE; TERMINATION OF BENEFITS. The Executive shall not be required to mitigate the amount of any compensation payable to him pursuant to Section 3(C)(1) hereof, whether by seeking other employment or otherwise. If, during the period during which he is receiving such compensation, the Executive obtains new full-time employment providing him with benefits comparable to those he is entitled to receive from the Company hereunder, then, when the Executive begins receiving such benefits from his new employer, the Executive will no longer be entitled to receive such benefits from the Company but will continue to be entitled to receive payment of his base salary (and other non-duplicative benefits) as provided for herein. 4. CHANGE OF CONTROL Upon the date (the "Effective Date") that is the earlier to occur of (x) the date that Purchaser pays for the Shares pursuant to the Offer and (y) the date of the Effective Time, the Executive (if such Executive is still employed by the Company immediately prior to such date) will be paid a bonus in an amount equal to the amount that would be payable to the Executive under Section 4(A) of the Original Employment Agreement upon the consummation of the Merger as if such Section 4(A) were in effect as of the Effective Time. 5. CERTAIN COVENANTS OF THE EXECUTIVE. The Executive acknowledges that (i) the Company, Parent and Parent's affiliates (collectively, "Thomson") are engaged and in the future will be engaged in the businesses of developing, operating, offering for sale and selling news or other current information or software-based solutions pertaining thereto to corporations and other businesses, government agencies, universities and other academic institutions and professional services providers (e.g. law, accounting and consulting firms) (the foregoing, together with any other businesses or -4- operations over which Executive has substantial responsibility from the date hereof to the date of termination of the Executive's employment with the Company (or an affiliate thereof), being hereinafter referred to as the "Restricted Activity"); (ii) his services to the Company and Thomson have been and will be special and unique; (iii) his work for the Company and Thomson will give him access to trade secrets of and confidential information concerning the Company, Thomson and their affiliated companies; (iv) the Restricted Activity is national and international in scope; (v) the Company would not have entered into this Agreement but for the agreements and covenants contained in this Section 5; (vi) he has the means to support himself and his dependents other than by engaging in the Restricted Activity and the provisions of this Section 5 will not impair such ability; and (vii) the agreements and covenants contained in this Section 5 are essential to protect the business and goodwill of the Company, Thomson and their affiliates. In order to induce the Company to enter into this Agreement, and in consideration for the benefits received by the Executive pursuant to this Agreement, and other good and valuable consideration the receipt of which is hereby acknowledged, the Executive covenants and agrees as follows: (A) NON-COMPETE. During the Restricted Period (as hereinafter defined), the Executive shall not in the United States of America, or in any foreign country, directly or indirectly, (i) engage in the Restricted Activity for the benefit of any person or entity other than the Company, Thomson and their affiliated companies; (ii) be an employee or consultant of, or provide services to, Factiva or Lexus/Nexis or any of their respective direct or indirect subsidiaries; (iii) have an interest in any person engaged in the Restricted Activity in any capacity, including, without limitation, as a partner, shareholder, officer, director, principal, agent, employee, trustee or consultant or any other relationship or capacity; provided, however, the Executive may own, directly or indirectly, solely as an investment, securities of any person which are publicly traded if the Executive (a) is not a controlling person of, or a member of a group which controls, such person, and (b) does not, directly or indirectly, own 1% or more of any class of securities of such person; or (iv) interfere with business relationships (whether formed heretofore or hereafter) between the Company or any of its affiliates and customers or suppliers of the Company or any of its affiliates. The term "Restricted Period" shall mean the period ending on the date that is (x) with respect to clause (ii) of this Section 5(A), eighteen (18) months following the end of the Executive's employment by the Company (or any affiliate of the Company) whether or not pursuant to this Agreement and (y) with respect to clauses (i), (iii) and (iv) of this Section 5(A), twelve (12) months following the end of the Executive's employment by the Company (or any affiliates of the Company) whether or not pursuant to this Agreement. (B) NON-DISCLOSURE. The Executive shall, during the Term of this Agreement and at all times thereafter, treat as confidential and, except as required in the performance of his duties and responsibilities under this Agreement, not disclose, publish or otherwise make available to the public or to any individual, firm or corporation any confidential material (as hereinafter defined). The Executive agrees that all confidential material, together with all notes and records of the Executive relating thereto, and all copies or facsimiles thereof in the possession of the Executive, are the exclusive property of the Company or Thomson, as the case may be, and the Executive agrees to return such material to the Company promptly upon the termination of the Executive's employment with the Company. For the purposes hereof, the term "confidential material" shall mean all information acquired by the Executive in the course of the Executive's employment with the Company in any way concerning the products, projects, activities, business or affairs of the Company or Thomson or the customers, suppliers, licensors, -5- licensees or partners of the Company or Thomson, including, without limitation, all information concerning trade secrets and the products or projects of the Company or Thomson and/or any improvements therein, all sales and financial information concerning the Company or Thomson, all customer and supplier lists, all information concerning projects in research and development or marketing plans for any such products or projects, all information concerning technical data, designs, patterns, formulae, computer programs, source code, object code, algorithms and subroutines of the Company or Thomson, and all information in any way concerning the products, projects, activities, business or affairs of customers of the Company or Thomson which is furnished to the Executive by the Company or Thomson or any of their respective employees (current or former), agents or customers, as such; provided, however, that the term "confidential material" shall not include information which (a) becomes generally available to the public other than as a result of a disclosure by the Executive, (b) was available to the Executive on a non-confidential basis prior to his employment with the Company or (c) becomes available to the Executive on a non-confidential basis from a source other than the Company or Thomson or any of their agents, franchisees, creditors, suppliers, lessors, lessees, licensors, licensees, partners or customers provided that such source is not bound by a confidentiality agreement with the Company or Thomson or any of such agents or customers. (C) NON-SOLICITATION. During the Restricted Period, the Executive shall not (i) hire or attempt to hire, or (ii) solicit or entice or attempt to solicit or entice away, any person who is (at the applicable time or was within the six month period prior to any such hire, solicitation or enticement) an officer, employee or consultant of the Company or Thomson Legal & Regulatory (including without limitation Dialog) (in the case of clause (i) above) or the Company or Thomson (in the case of clause (ii) above), as applicable, either for his own account or for any individual, firm or corporation, whether or not such person would commit any breach of his contract of employment by reason of leaving the service of the Company, Thomson or Thomson Legal & Regulatory (including without limitation Dialog), as applicable. (D) DEVELOPMENTS. The Executive agrees that all discoveries, inventions, processes, methods and improvements, conceived, developed or otherwise made by the Executive at any time, alone or with others in any way relating to the Company's present or future business or products, whether patentable or subject to copyright protection and whether or not reduced to practice, during the period of the Executive's employment with the Company ("Developments"), shall be the sole property of the Company. The Executive agrees to, and hereby does, assign to the Company all of the Executive's right, title and interest throughout the world in and to all Developments. The Executive agrees that such Developments shall constitute works made for hire under the copyright laws of the United States and hereby assigns to the Company all copyrights, patents and other proprietary rights the Executive may have in such Developments. The Executive shall make and maintain adequate and current written records of all Developments, and the Executive shall disclose all developments promptly, fully and in writing to the Company promptly after development of the same, and at any time upon request, provided, however, that developments excluded under the following paragraph shall be received by the Company in confidence. The Executive has informed the Company in writing of any continuing obligations to any previous employers which require him not to disclose to the Company any information, and the Executive has also informed the Company in writing of any and all confidential information or Developments which the Executive claims as his own and intends to -6- exclude from the restrictions set forth in the previous paragraph because it was developed by the Executive prior to the commencement of his employment by the Company. There shall also be excluded from the restrictions set forth in the previous paragraph any Development made by the Executive (a) which is developed by the Executive without the use of the Company's property or facilities, (b) which does not make any use of confidential information, (c) which is developed by the Executive entirely on his own time, and (d) which does not relate to the Company's business or to the Company's ongoing or planned research and development efforts. At any time at the request of the Company (and at the Company's expense), the Executive shall execute all documents and perform all lawful acts the Company considers necessary or advisable to secure its rights hereunder and to carry out the intent of this Section 5(D). At any time upon the request of the Company, the Executive shall return promptly to the Company all the Company's property, including all copies of all confidential information or Developments. (E) In the event of a breach or threatened breach by the Executive of any of the provisions of Section 5 of this Agreement, the Executive hereby consents and agrees that the Company shall be entitled to an injunction or similar equitable relief from any court of competent jurisdiction restraining the Executive from committing or continuing any such breach or threatened breach or granting specific performance of any act required to be performed by the Executive under any of such provisions, without the necessity of showing any actual damage or that money damages would not afford an adequate remedy and without the necessity of posting any bond or other security. Nothing herein shall be construed as prohibiting the Company from pursuing any other remedies at law or in equity which it may have with respect to any such breach or threatened breach. 6. MISCELLANEOUS. (A) BENEFITS OF AGREEMENT; NO ASSIGNMENTS; NO THIRD-PARTY BENEFICIARIES. (1) This Agreement will bind and inure to the benefit of the parties hereto and their respective heirs, successors, and permitted assigns. (2) Neither party will assign any rights or delegate any obligations hereunder without the consent of the other party (except that the Company may assign its rights and delegate its obligations hereunder to any affiliate of the Company or to any successor to its business, whether by merger or consolidation, sale of stock or of all or substantially all of its assets, or otherwise), and any attempt to do so will be void. (3) Nothing in this Agreement is intended to or will confer any rights or remedies on any person or entity other than the parties hereto, their respective heirs, successors, and permitted assigns. (B) NOTICES. All notices, requests, payments, instructions, or other documents to be given hereunder will be in writing or by written telecommunication, and will be deemed to have been duly given if (i) delivered personally (effective upon delivery), (ii) mailed by registered or certified mail, return receipt requested, postage prepaid (effective five business days after dispatch), (iii) sent by a reputable, established courier service that guarantees next business day delivery (effective the next business day), or (iv) sent by telecopier followed within 24 hours by confirmation by one of the foregoing methods (effective upon receipt of the telecopy -7- in complete, readable form), addressed to the recipient party at its address set forth in the first paragraph hereof (or to such other address as the recipient party may have furnished to the sending party for the purpose pursuant to this section) and, with respect to any notice given on or prior to the Effective Date, with a copy sent to the Purchaser at its address set forth in the Merger Agreement. (C) COUNTERPARTS. This Agreement may be executed by the parties in separate counterparts, each of which when so executed and delivered will be an original, but all of which together will constitute one and the same agreement. In pleading or proving this Agreement, it will not be necessary to produce or account for more than one such counterpart. (D) CAPTIONS. The captions of sections or subsections of this Agreement are for reference only and will not affect the interpretation or construction of this Agreement. (E) CONSTRUCTION. The language used in this Agreement is the language chosen by the parties to express their mutual intent, and no rule of strict construction will be applied against either party. (F) WAIVERS; AMENDMENTS. No waiver of any breach or default hereunder will be valid unless in writing signed by the waiving party. No failure or other delay by any party exercising any right, power, or privilege hereunder will be or operate as a waiver thereof, nor will any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power, or privilege. No amendment or modification of this Agreement will be valid or binding unless in a writing signed by both the Executive and the Company and, with respect to any amendment or modification of this Agreement prior to the Effective Date, by Purchaser. (G) ENTIRE AGREEMENT. This Agreement contains the entire understanding and agreement between the parties, and supersedes any prior understandings or agreements between them, with respect to the subject matter hereof (including, without limitation, the Original Employment Agreement). The parties acknowledge and agree that any and all agreements between the parties relating to stock options granted by the Company (including its predecessors, successors and affiliates) to the Executive, are superseded by and subject to the Stockholders Agreement between the Executive and the Company and Section 3.07 of the Merger Agreement. (H) GOVERNING LAW. This Agreement will be governed by and interpreted and construed in accordance with the internal laws of the Commonwealth of Massachusetts, without reference to principles of conflicts or choice of law. * * * -8- IN WITNESS WHEREOF, each of the Company and the Executive has executed and delivered this Agreement as an agreement under seal as of the date first above written. EXECUTIVE: /s/ Clifford Pollan - ----------------------------------- COMPANY: /s/ Rory Cowan - ----------------------------------- -9- EX-99.E5 7 a2057464zex-99_e5.txt EXHIBIT 99.E.5 AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT This Amended and Restated Executive Employment Agreement (this "Agreement") dated as of August 6, 2001 is by and between NEWSEDGE CORPORATION (the "Company"), a Delaware corporation having its principal executive offices at 80 Blanchard Road, Burlington, Massachusetts, and Ronald Benanto (the "Executive"). WHEREAS, THE THOMSON CORPORATION ("Parent") proposes to acquire the Company pursuant to that certain Agreement and Plan of Merger dated as of August 6, 2001 ("Merger Agreement") by and among the Company, Parent and INFOBLADE ACQUISITION CORPORATION ("Purchaser"); and WHEREAS, the Executive currently serves as Vice President of Finance and Chief Financial Officer of the Company pursuant to an Amended and Restated Executive Employment Agreement dated as of April 1, 2001 (the "Original Employment Agreement") between the Company and the Executive; and WHEREAS, the Company and the Executive desire to amend and restate the Original Employment Agreement in its entirety as of the date hereof and to provide for the employment of Executive by the Company from and after the Effective Date (as hereinafter defined) in accordance with the terms hereof. NOW, THEREFORE, in consideration of the terms, conditions, and mutual covenants hereinafter contained, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto do hereby agree to amend and restate the Original Employment Agreement in its entirety as follows: 1. EFFECTIVENESS; EMPLOYMENT OF EXECUTIVE; TERM. (A) EFFECTIVENESS. The terms and conditions of this Agreement shall become effective automatically, without further act or deed by the Executive or the Company, on the date hereof and the Original Employment Agreement is hereby superseded in its entirety and of no further force and effect, provided, however, that notwithstanding the foregoing, in the event that the Merger Agreement is terminated prior to the Effective Time (as defined in the Merger Agreement), this Agreement shall automatically terminate and have no further force or effect and the Original Employment Agreement shall be automatically reinstated upon such termination of the Merger Agreement. (B) EMPLOYMENT. Subject to the terms and conditions of this Agreement, during the Term (as hereinafter defined), the Company agrees to employ the Executive, and the Executive agrees to serve, as the Company's Vice President of Finance and Chief Finance Officer, reporting to the Company's President and Chief Executive Officer (the Executive's "Supervisor") and having such powers and duties consistent with his position as may reasonably be assigned to him from time to time. (C) COMMITMENT. The Executive represents that he is not currently party to or bound by any commitments that might interfere with or impair his performance of such duties and responsibilities or that are inconsistent with his obligations hereunder. The Executive will devote such time and attention to his duties and responsibilities hereunder as reasonably are required, and will not undertake any commitments that would interfere with or impair his performance of such duties and responsibilities. TERM. The term of the Executive's employment under this Agreement shall commence on the Effective Date (as defined in Section 4 below) and shall terminate on the one-year anniversary date of the Effective Date, unless sooner terminated in accordance with Section 3 of this Agreement (the "Term"). Upon the expiration of the Term, the Executive's employment with the Company shall be "at will" and such Executive's employment may be terminated by the Company at any time upon or after such expiration with or without cause, and that upon such termination the Executive shall have no rights under this Agreement including, without limitation, any right to any severance or other termination payments. 2. COMPENSATION. During the Term of the Executive's employment with the Company hereunder, the Company will compensate the Executive as follows: (A) SALARY. The Company will pay to the Executive a base salary, payable in accordance with the payroll practices of the Company, at the rate of $210,000 per annum. The Executive's base salary shall be subject to annual review by the Company and Parent. (B) PERFORMANCE BONUSES. The Executive will be eligible to receive an annual cash bonus at an annualized rate of up to 40% of his base salary, based on the achievement of reasonable individual and Company performance targets to be established by the Company and Parent. (C) STAY BONUS. If the Executive is an active employee of the Company on the one-year anniversary (the "Anniversary Date") of the Effective Date, the Executive will be paid a bonus equal to $210,000. (D) BENEFITS. The Company will promptly reimburse all out-of-pocket expenses reasonably incurred by the Executive in the course of performing his employment duties and responsibilities hereunder, subject to receipt of appropriate documentation. The Company will also provide consistent with his position, Company-paid health and life insurance, and with such other fringe benefits as it from time to time may make generally available to its other senior executives at the Executive's level. 3. TERMINATION. (A) EVENTS CAUSING TERMINATION. The Executive's employment hereunder will terminate upon the occurrence of any of the following events: (1) The Executive's death, or a determination of his legal incapacity by a court of competent jurisdiction; (2) The termination of the Executive's employment hereunder by the Company, by written notice to the Executive, upon the Executive's inability due -2- to illness or injury to perform the essential functions of his position with or without reasonable accommodation; (3) The termination of the Executive's employment hereunder by the Company, for Cause, by written notice to the Executive; (4) The termination of the Executive's employment hereunder by the Company, without Cause, by written notice to the Executive; (5) The termination of the Executive's employment hereunder by the Executive, for Good Reason, by thirty (30) days prior written notice to the Company; or (6) The expiration of the Term of this Agreement under Section 1(D) hereof. (B) "CAUSE" AND "GOOD REASON" DEFINED. For purposes of this Agreement: "Cause" means: (a) the Executive's conviction of any crime (whether or not involving the Company) (other than unintentional motor vehicle felonies); (b) any act of theft, fraud or embezzlement by the Executive in connection with his work with the Company; or (c) the Executive's continuing, repeated and willful failure or refusal to perform, or continuing, repeated and gross negligence in the performance of, his material duties and services to the Company (other than due to his incapacity due to illness or injury), provided that such failure or refusal or gross negligence continues uncorrected for a period of 30 days after the Executive shall have received written notice from the Company setting forth with specificity the nature of such failure, refusal, or gross negligence; (d) the breach of this Agreement by the Executive; or (e) the willful violation of Federal and/or state securities laws. "GOOD REASON" means the occurrence of one or more of the following occurring without the specific written consent of the Executive: (i) a material reduction of duties of the Executive, excluding any such reduction in duties reasonably occurring as a result of the transactions contemplated by the Merger Agreement; (ii) a material demotion, or a reduction in base salary of the Executive; (iii) any requirement that the Executive's principal place of work be relocated outside of the Commonwealth of Massachusetts or more than twenty-five (25) miles from its location as of the date of this Agreement; (iv) the Company's breach of any term of this Agreement which is not fully remedied within fifteen (15) calendar days after receipt by the Company of a written notice from the Executive of such breach. (C) ADJUSTMENTS UPON TERMINATION. Notwithstanding any other provision of this Agreement: (1) If the Executive's employment with the Company terminates during the Term pursuant Section 3(A)(4) (by the Company, without Cause) or Section 3(A)(5) (by the Executive, for Good Reason), then, for a twelve (12) month period immediately following the date of such termination, the Company will continue to pay the Executive a base salary at a rate equal to that at which he was being paid at the time of termination and (subject to Section 3(D) below), will likewise continue to provide the Executive with the benefits that he was receiving at the time of termination (or, if the Company is unable to do so because -3- such benefits may only be provided to current employees, subject to the provisions of Section 3(D) it will provide the Executive with the cash value thereof). In addition to the payments and benefits specified above, the Company will pay the Executive on the date of termination a lump sum payment for all accrued unused vacation time. It is agreed and understood that the Company's duty to make the payments and provide the benefits described in this Section 3(C)(1) shall be conditioned upon the Executive's execution of a satisfactory general release in favor of the Company and the Executive's compliance with Section 5 hereof. (2) If the Executive's employment with the Company terminates during the Term other than pursuant to Section 3(A)(4) (by the Company, without Cause) or Section 3(A)(5) (by the Executive, with Good Reason), then the rights of the Executive to receive future compensation pursuant to Section 2 and Section 3(C)(1) hereof, and all other rights of the Executive hereunder, will cease as of the date of such termination except as may be required by law. As of the date of such termination, the Executive shall receive a lump sum payment for all accrued unpaid wages and accrued unused vacation time. (D) NO DUTY TO MITIGATE; TERMINATION OF BENEFITS. The Executive shall not be required to mitigate the amount of any compensation payable to him pursuant to Section 3(C)(1) hereof, whether by seeking other employment or otherwise. If, during the period during which he is receiving such compensation, the Executive obtains new full-time employment providing him with benefits comparable to those he is entitled to receive from the Company hereunder, then, when the Executive begins receiving such benefits from his new employer, the Executive will no longer be entitled to receive such benefits from the Company but will continue to be entitled to receive payment of his base salary (and other non-duplicative benefits) as provided for herein. 4. CHANGE OF CONTROL Upon the date (the "Effective Date") that is the earlier to occur of (x) the date that Purchaser pays for the Shares pursuant to the Offer and (y) the date of the Effective Time, the Executive (if such Executive is still employed by the Company immediately prior to such date) will be paid a bonus in an amount equal to the amount that would be payable to the Executive under Section 4(A) of the Original Employment Agreement upon the consummation of the Merger as if such Section 4(A) were in effect as of the Effective Time. 5. CERTAIN COVENANTS OF THE EXECUTIVE. The Executive acknowledges that (i) the Company, Parent and Parent's affiliates (collectively, "Thomson") are engaged and in the future will be engaged in the businesses of developing, operating, offering for sale and selling news or other current information or software-based solutions pertaining thereto to corporations and other businesses, government agencies, universities and other academic institutions and professional services providers (e.g. law, accounting and consulting firms) (the foregoing, together with any other businesses or operations over which Executive has substantial responsibility from the date hereof to the date of termination of the Executive's employment with the Company (or an affiliate thereof), being -4- hereinafter referred to as the "Restricted Activity"); (ii) his services to the Company and Thomson have been and will be special and unique; (iii) his work for the Company and Thomson will give him access to trade secrets of and confidential information concerning the Company, Thomson and their affiliated companies; (iv) the Restricted Activity is national and international in scope; (v) the Company would not have entered into this Agreement but for the agreements and covenants contained in this Section 5; (vi) he has the means to support himself and his dependents other than by engaging in the Restricted Activity and the provisions of this Section 5 will not impair such ability; and (vii) the agreements and covenants contained in this Section 5 are essential to protect the business and goodwill of the Company, Thomson and their affiliates. In order to induce the Company to enter into this Agreement, and in consideration for the benefits received by the Executive pursuant to this Agreement, and other good and valuable consideration the receipt of which is hereby acknowledged, the Executive covenants and agrees as follows: (A) NON-COMPETE. During the Restricted Period (as hereinafter defined), the Executive shall not in the United States of America, or in any foreign country, directly or indirectly, (i) engage in the Restricted Activity for the benefit of any person or entity other than the Company, Thomson and their affiliated companies; (ii) be an employee or consultant of, or provide services to, Factiva or Lexus/Nexis or any of their respective direct or indirect subsidiaries; (iii) have an interest in any person engaged in the Restricted Activity in any capacity, including, without limitation, as a partner, shareholder, officer, director, principal, agent, employee, trustee or consultant or any other relationship or capacity; provided, however, the Executive may own, directly or indirectly, solely as an investment, securities of any person which are publicly traded if the Executive (a) is not a controlling person of, or a member of a group which controls, such person, and (b) does not, directly or indirectly, own 1% or more of any class of securities of such person; or (iv) interfere with business relationships (whether formed heretofore or hereafter) between the Company or any of its affiliates and customers or suppliers of the Company or any of its affiliates. The term "Restricted Period" shall mean the period ending on the date that is (x) with respect to clause (ii) of this Section 5(A), eighteen (18) months following the end of the Executive's employment by the Company (or any affiliate of the Company) whether or not pursuant to this Agreement and (y) with respect to clauses (i), (iii) and (iv) of this Section 5(A), twelve (12) months following the end of the Executive's employment by the Company (or any affiliates of the Company) whether or not pursuant to this Agreement. (B) NON-DISCLOSURE. The Executive shall, during the Term of this Agreement and at all times thereafter, treat as confidential and, except as required in the performance of his duties and responsibilities under this Agreement, not disclose, publish or otherwise make available to the public or to any individual, firm or corporation any confidential material (as hereinafter defined). The Executive agrees that all confidential material, together with all notes and records of the Executive relating thereto, and all copies or facsimiles thereof in the possession of the Executive, are the exclusive property of the Company or Thomson, as the case may be, and the Executive agrees to return such material to the Company promptly upon the termination of the Executive's employment with the Company. For the purposes hereof, the term "confidential material" shall mean all information acquired by the Executive in the course of the Executive's employment with the Company in any way concerning the products, projects, activities, business or affairs of the Company or Thomson or the customers, suppliers, licensors, licensees or partners of the Company or Thomson, including, without limitation, all information concerning trade secrets and the products or projects of the Company or Thomson and/or any -5- improvements therein, all sales and financial information concerning the Company or Thomson, all customer and supplier lists, all information concerning projects in research and development or marketing plans for any such products or projects, all information concerning technical data, designs, patterns, formulae, computer programs, source code, object code, algorithms and subroutines of the Company or Thomson, and all information in any way concerning the products, projects, activities, business or affairs of customers of the Company or Thomson which is furnished to the Executive by the Company or Thomson or any of their respective employees (current or former), agents or customers, as such; provided, however, that the term "confidential material" shall not include information which (a) becomes generally available to the public other than as a result of a disclosure by the Executive, (b) was available to the Executive on a non-confidential basis prior to his employment with the Company or (c) becomes available to the Executive on a non-confidential basis from a source other than the Company or Thomson or any of their agents, franchisees, creditors, suppliers, lessors, lessees, licensors, licensees, partners or customers provided that such source is not bound by a confidentiality agreement with the Company or Thomson or any of such agents or customers. (C) NON-SOLICITATION. During the Restricted Period, the Executive shall not (i) hire or attempt to hire, or (ii) solicit or entice or attempt to solicit or entice away, any person who is (at the applicable time or was within the six month period prior to any such hire, solicitation or enticement) an officer, employee or consultant of the Company or Thomson Legal & Regulatory (including without limitation Dialog) (in the case of clause (i) above) or the Company or Thomson (in the case of clause (ii) above), as applicable, either for his own account or for any individual, firm or corporation, whether or not such person would commit any breach of his contract of employment by reason of leaving the service of the Company, Thomson or Thomson Legal & Regulatory (including without limitation Dialog), as applicable. (D) DEVELOPMENTS. The Executive agrees that all discoveries, inventions, processes, methods and improvements, conceived, developed or otherwise made by the Executive at any time, alone or with others in any way relating to the Company's present or future business or products, whether patentable or subject to copyright protection and whether or not reduced to practice, during the period of the Executive's employment with the Company ("Developments"), shall be the sole property of the Company. The Executive agrees to, and hereby does, assign to the Company all of the Executive's right, title and interest throughout the world in and to all Developments. The Executive agrees that such Developments shall constitute works made for hire under the copyright laws of the United States and hereby assigns to the Company all copyrights, patents and other proprietary rights the Executive may have in such Developments. The Executive shall make and maintain adequate and current written records of all Developments, and the Executive shall disclose all developments promptly, fully and in writing to the Company promptly after development of the same, and at any time upon request, provided, however, that developments excluded under the following paragraph shall be received by the Company in confidence. The Executive has informed the Company in writing of any continuing obligations to any previous employers which require him not to disclose to the Company any information, and the Executive has also informed the Company in writing of any and all confidential information or Developments which the Executive claims as his own and intends to exclude from the restrictions set forth in the previous paragraph because it was developed by the Executive prior to the commencement of his employment by the Company. There shall also be -6- excluded from the restrictions set forth in the previous paragraph any Development made by the Executive (a) which is developed by the Executive without the use of the Company's property or facilities, (b) which does not make any use of confidential information, (c) which is developed by the Executive entirely on his own time, and (d) which does not relate to the Company's business or to the Company's ongoing or planned research and development efforts. At any time at the request of the Company (and at the Company's expense), the Executive shall execute all documents and perform all lawful acts the Company considers necessary or advisable to secure its rights hereunder and to carry out the intent of this Section 5(D). At any time upon the request of the Company, the Executive shall return promptly to the Company all the Company's property, including all copies of all confidential information or Developments. (E) In the event of a breach or threatened breach by the Executive of any of the provisions of Section 5 of this Agreement, the Executive hereby consents and agrees that the Company shall be entitled to an injunction or similar equitable relief from any court of competent jurisdiction restraining the Executive from committing or continuing any such breach or threatened breach or granting specific performance of any act required to be performed by the Executive under any of such provisions, without the necessity of showing any actual damage or that money damages would not afford an adequate remedy and without the necessity of posting any bond or other security. Nothing herein shall be construed as prohibiting the Company from pursuing any other remedies at law or in equity which it may have with respect to any such breach or threatened breach. 6. MISCELLANEOUS. (A) BENEFITS OF AGREEMENT; NO ASSIGNMENTS; NO THIRD-PARTY BENEFICIARIES. (1) This Agreement will bind and inure to the benefit of the parties hereto and their respective heirs, successors, and permitted assigns. (2) Neither party will assign any rights or delegate any obligations hereunder without the consent of the other party (except that the Company may assign its rights and delegate its obligations hereunder to any affiliate of the Company or to any successor to its business, whether by merger or consolidation, sale of stock or of all or substantially all of its assets, or otherwise), and any attempt to do so will be void. (3) Nothing in this Agreement is intended to or will confer any rights or remedies on any person or entity other than the parties hereto, their respective heirs, successors, and permitted assigns. (B) NOTICES. All notices, requests, payments, instructions, or other documents to be given hereunder will be in writing or by written telecommunication, and will be deemed to have been duly given if (i) delivered personally (effective upon delivery), (ii) mailed by registered or certified mail, return receipt requested, postage prepaid (effective five business days after dispatch), (iii) sent by a reputable, established courier service that guarantees next business day delivery (effective the next business day), or (iv) sent by telecopier followed within 24 hours by confirmation by one of the foregoing methods (effective upon receipt of the telecopy in complete, readable form), addressed to the recipient party at its address set forth in the first paragraph hereof (or to such other address as the recipient party may have furnished to the -7- sending party for the purpose pursuant to this section) and, with respect to any notice given on or prior to the Effective Date, with a copy sent to the Purchaser at its address set forth in the Merger Agreement. (C) COUNTERPARTS. This Agreement may be executed by the parties in separate counterparts, each of which when so executed and delivered will be an original, but all of which together will constitute one and the same agreement. In pleading or proving this Agreement, it will not be necessary to produce or account for more than one such counterpart. (D) CAPTIONS. The captions of sections or subsections of this Agreement are for reference only and will not affect the interpretation or construction of this Agreement. (E) CONSTRUCTION. The language used in this Agreement is the language chosen by the parties to express their mutual intent, and no rule of strict construction will be applied against either party. (F) WAIVERS; AMENDMENTS. No waiver of any breach or default hereunder will be valid unless in writing signed by the waiving party. No failure or other delay by any party exercising any right, power, or privilege hereunder will be or operate as a waiver thereof, nor will any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power, or privilege. No amendment or modification of this Agreement will be valid or binding unless in a writing signed by both the Executive and the Company and, with respect to any amendment or modification of this Agreement prior to the Effective Date, by Purchaser. (G) ENTIRE AGREEMENT. This Agreement contains the entire understanding and agreement between the parties, and supersedes any prior understandings or agreements between them, with respect to the subject matter hereof (including, without limitation, the Original Employment Agreement). The parties acknowledge and agree that any and all agreements between the parties relating to stock options granted by the Company (including its predecessors, successors and affiliates) to the Executive, are superseded by and subject to the Stockholders Agreement between the Executive and the Company and Section 3.07 of the Merger Agreement. (H) GOVERNING LAW. This Agreement will be governed by and interpreted and construed in accordance with the internal laws of the Commonwealth of Massachusetts, without reference to principles of conflicts or choice of law. * * * -8- IN WITNESS WHEREOF, each of the Company and the Executive has executed and delivered this Agreement as an agreement under seal as of the date first above written. EXECUTIVE: /s/ Ronald Benanto - ----------------------------------- COMPANY: /s/ Clifford Pollan - ----------------------------------- -9- EX-99.E6 8 a2057464zex-99_e6.txt EXHIBIT 99.E.6 AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT This Amended and Restated Executive Employment Agreement (this "Agreement") dated as of August 6, 2001 is by and between NEWSEDGE CORPORATION (the "Company"), a Delaware corporation having its principal executive offices at 80 Blanchard Road, Burlington, Massachusetts, and Charles White (the "Executive"). WHEREAS, THE THOMSON CORPORATION ("Parent") proposes to acquire the Company pursuant to that certain Agreement and Plan of Merger dated as of August 6, 2001 ("Merger Agreement") by and among the Company, Parent and INFOBLADE ACQUISITION CORPORATION ("Purchaser"); and WHEREAS, the Executive currently serves as Vice President, e-Content Business of the Company pursuant to an Amended and Restated Executive Employment Agreement dated as of April 1, 2001 (the "Original Employment Agreement") between the Company and the Executive; and WHEREAS, the Company and the Executive desire to amend and restate the Original Employment Agreement in its entirety as of the date hereof and to provide for the employment of Executive by the Company from and after the Effective Date (as hereinafter defined) in accordance with the terms hereof. NOW, THEREFORE, in consideration of the terms, conditions, and mutual covenants hereinafter contained, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto do hereby agree to amend and restate the Original Employment Agreement in its entirety as follows: 1. EFFECTIVENESS; EMPLOYMENT OF EXECUTIVE; TERM. (A) EFFECTIVENESS. The terms and conditions of this Agreement shall become effective automatically, without further act or deed by the Executive or the Company, on the date hereof and the Original Employment Agreement is hereby superseded in its entirety and of no further force and effect, provided, however, that notwithstanding the foregoing, in the event that the Merger Agreement is terminated prior to the Effective Time (as defined in the Merger Agreement), this Agreement shall automatically terminate and have no further force or effect and the Original Employment Agreement shall be automatically reinstated upon such termination of the Merger Agreement. (B) EMPLOYMENT. Subject to the terms and conditions of this Agreement, during the Term (as hereinafter defined), the Company agrees to employ the Executive, and the Executive agrees to serve, as the Company's Vice President, e-Content Business, reporting to the Company's President and Chief Executive Officer (the Executive's "Supervisor") and having such powers and duties consistent with his position as may reasonably be assigned to him from time to time. (C) COMMITMENT. The Executive represents that he is not currently party to or bound by any commitments that might interfere with or impair his performance of such duties and responsibilities or that are inconsistent with his obligations hereunder. The Executive will devote such time and attention to his duties and responsibilities hereunder as reasonably are required, and will not undertake any commitments that would interfere with or impair his performance of such duties and responsibilities. TERM. The term of the Executive's employment under this Agreement shall commence on the Effective Date (as defined in Section 4 below) and shall terminate on the one-year anniversary date of the Effective Date, unless sooner terminated in accordance with Section 3 of this Agreement (the "Term"). Upon the expiration of the Term, the Executive's employment with the Company shall be "at will" and such Executive's employment may be terminated by the Company at any time upon or after such expiration with or without cause, and that upon such termination the Executive shall have no rights under this Agreement including, without limitation, any right to any severance or other termination payments. 2. COMPENSATION. During the Term of the Executive's employment with the Company hereunder, the Company will compensate the Executive as follows: (A) SALARY. The Company will pay to the Executive a base salary, payable in accordance with the payroll practices of the Company, at the rate of $185,000 per annum. The Executive's base salary shall be subject to annual review by the Company and Parent. (B) PERFORMANCE BONUSES. The Executive will be eligible to receive an annual cash bonus at an annualized rate of up to 40% of his base salary, based on the achievement of reasonable individual and Company performance targets to be established by the Company and Parent. (C) STAY BONUS. If the Executive is an active employee of the Company on the one-year anniversary (the "Anniversary Date") of the Effective Date, the Executive will be paid a bonus equal to $185,000. (D) BENEFITS. The Company will promptly reimburse all out-of-pocket expenses reasonably incurred by the Executive in the course of performing his employment duties and responsibilities hereunder, subject to receipt of appropriate documentation. The Company will also provide consistent with his position, Company-paid health and life insurance, and with such other fringe benefits as it from time to time may make generally available to its other senior executives at the Executive's level. 3. TERMINATION. (A) EVENTS CAUSING TERMINATION. The Executive's employment hereunder will terminate upon the occurrence of any of the following events: (1) The Executive's death, or a determination of his legal incapacity by a court of competent jurisdiction; (2) The termination of the Executive's employment hereunder by the Company, by written notice to the Executive, upon the Executive's inability due -2- to illness or injury to perform the essential functions of his position with or without reasonable accommodation; (3) The termination of the Executive's employment hereunder by the Company, for Cause, by written notice to the Executive; (4) The termination of the Executive's employment hereunder by the Company, without Cause, by written notice to the Executive; (5) The termination of the Executive's employment hereunder by the Executive, for Good Reason, by thirty (30) days prior written notice to the Company; or (6) The expiration of the Term of this Agreement under Section 1(D) hereof. (B) "CAUSE" AND "GOOD REASON" DEFINED. For purposes of this Agreement: "Cause" means: (a) the Executive's conviction of any crime (whether or not involving the Company) (other than unintentional motor vehicle felonies); (b) any act of theft, fraud or embezzlement by the Executive in connection with his work with the Company; or (c) the Executive's continuing, repeated and willful failure or refusal to perform, or continuing, repeated and gross negligence in the performance of, his material duties and services to the Company (other than due to his incapacity due to illness or injury), provided that such failure or refusal or gross negligence continues uncorrected for a period of 30 days after the Executive shall have received written notice from the Company setting forth with specificity the nature of such failure, refusal, or gross negligence; (d) the breach of this Agreement by the Executive; or (e) the willful violation of Federal and/or state securities laws. "GOOD REASON" means the occurrence of one or more of the following occurring without the specific written consent of the Executive: (i) a material reduction of duties of the Executive, excluding any such reduction in duties reasonably occurring as a result of the transactions contemplated by the Merger Agreement; (ii) a material demotion, or a reduction in base salary of the Executive; (iii) any requirement that the Executive's principal place of work be relocated outside of the Commonwealth of Massachusetts or more than twenty-five (25) miles from its location as of the date of this Agreement; (iv) the Company's breach of any term of this Agreement which is not fully remedied within fifteen (15) calendar days after receipt by the Company of a written notice from the Executive of such breach. (C) ADJUSTMENTS UPON TERMINATION. Notwithstanding any other provision of this Agreement: (1) If the Executive's employment with the Company terminates during the Term pursuant Section 3(A)(4) (by the Company, without Cause) or Section 3(A)(5) (by the Executive, for Good Reason), then, for a twelve (12) month period immediately following the date of such termination, the Company will continue to pay the Executive a base salary at a rate equal to that at which he was being paid at the time of termination, and (subject to Section 3(D) below), will likewise continue to provide the Executive with the benefits that he was receiving at the time of termination (or, if the Company is unable to do so because -3- such benefits may only be provided to current employees, subject to the provisions of Section 3(D) it will provide the Executive with the cash value thereof). In addition to the payments and benefits specified above, the Company will pay the Executive on the date of termination a lump sum payment for all accrued unused vacation time. It is agreed and understood that the Company's duty to make the payments and provide the benefits described in this Section 3(C)(1) shall be conditioned upon the Executive's execution of a satisfactory general release in favor of the Company and the Executive's compliance with Section 5 hereof. (2) If the Executive's employment with the Company terminates during the Term other than pursuant to Section 3(A)(4) (by the Company, without Cause) or Section 3(A)(5) (by the Executive, with Good Reason), then the rights of the Executive to receive future compensation pursuant to Section 2 and Section 3(C)(1) hereof, and all other rights of the Executive hereunder, will cease as of the date of such termination except as may be required by law. As of the date of such termination, the Executive shall receive a lump sum payment for all accrued unpaid wages and accrued unused vacation time. (D) NO DUTY TO MITIGATE; TERMINATION OF BENEFITS. The Executive shall not be required to mitigate the amount of any compensation payable to him pursuant to Section 3(C)(1) hereof, whether by seeking other employment or otherwise. If, during the period during which he is receiving such compensation, the Executive obtains new full-time employment providing him with benefits comparable to those he is entitled to receive from the Company hereunder, then, when the Executive begins receiving such benefits from his new employer, the Executive will no longer be entitled to receive such benefits from the Company but will continue to be entitled to receive payment of his base salary (and other non-duplicative benefits) as provided for herein. 4. CHANGE OF CONTROL Upon the date (the "Effective Date") that is the earlier to occur of (x) the date that Purchaser pays for the Shares pursuant to the Offer and (y) the date of the Effective Time, the Executive (if such Executive is still employed by the Company immediately prior to such date) will be paid a bonus in an amount equal to the amount that would be payable to the Executive under Section 4(A) of the Original Employment Agreement upon the consummation of the Merger as if such Section 4(A) were in effect as of the Effective Time. 5. CERTAIN COVENANTS OF THE EXECUTIVE. The Executive acknowledges that (i) the Company, Parent and Parent's affiliates (collectively, "Thomson") are engaged and in the future will be engaged in the businesses of developing, operating, offering for sale and selling news or other current information or software-based solutions pertaining thereto to corporations and other businesses, government agencies, universities and other academic institutions and professional services providers (e.g. law, accounting and consulting firms) (the foregoing, together with any other businesses or operations over which Executive has substantial responsibility from the date hereof to the date of termination of the Executive's employment with the Company (or an affiliate thereof), being -4- hereinafter referred to as the "Restricted Activity"); (ii) his services to the Company and Thomson have been and will be special and unique; (iii) his work for the Company and Thomson will give him access to trade secrets of and confidential information concerning the Company, Thomson and their affiliated companies; (iv) the Restricted Activity is national and international in scope; (v) the Company would not have entered into this Agreement but for the agreements and covenants contained in this Section 5; (vi) he has the means to support himself and his dependents other than by engaging in the Restricted Activity and the provisions of this Section 5 will not impair such ability; and (vii) the agreements and covenants contained in this Section 5 are essential to protect the business and goodwill of the Company, Thomson and their affiliates. In order to induce the Company to enter into this Agreement, and in consideration for the benefits received by the Executive pursuant to this Agreement, and other good and valuable consideration the receipt of which is hereby acknowledged, the Executive covenants and agrees as follows: (A) NON-COMPETE. During the Restricted Period (as hereinafter defined), the Executive shall not in the United States of America, or in any foreign country, directly or indirectly, (i) engage in the Restricted Activity for the benefit of any person or entity other than the Company, Thomson and their affiliated companies; (ii) be an employee or consultant of, or provide services to, Factiva or Lexus/Nexis or any of their respective direct or indirect subsidiaries; (iii) have an interest in any person engaged in the Restricted Activity in any capacity, including, without limitation, as a partner, shareholder, officer, director, principal, agent, employee, trustee or consultant or any other relationship or capacity; provided, however, the Executive may own, directly or indirectly, solely as an investment, securities of any person which are publicly traded if the Executive (a) is not a controlling person of, or a member of a group which controls, such person, and (b) does not, directly or indirectly, own 1% or more of any class of securities of such person; or (iv) interfere with business relationships (whether formed heretofore or hereafter) between the Company or any of its affiliates and customers or suppliers of the Company or any of its affiliates. The term "Restricted Period" shall mean the period ending on the date that is (x) with respect to clause (ii) of this Section 5(A), eighteen (18) months following the end of the Executive's employment by the Company (or any affiliate of the Company) whether or not pursuant to this Agreement and (y) with respect to clauses (i), (iii) and (iv) of this Section 5(A), twelve (12) months following the end of the Executive's employment by the Company (or any affiliates of the Company) whether or not pursuant to this Agreement. (B) NON-DISCLOSURE. The Executive shall, during the Term of this Agreement and at all times thereafter, treat as confidential and, except as required in the performance of his duties and responsibilities under this Agreement, not disclose, publish or otherwise make available to the public or to any individual, firm or corporation any confidential material (as hereinafter defined). The Executive agrees that all confidential material, together with all notes and records of the Executive relating thereto, and all copies or facsimiles thereof in the possession of the Executive, are the exclusive property of the Company or Thomson, as the case may be, and the Executive agrees to return such material to the Company promptly upon the termination of the Executive's employment with the Company. For the purposes hereof, the term "confidential material" shall mean all information acquired by the Executive in the course of the Executive's employment with the Company in any way concerning the products, projects, activities, business or affairs of the Company or Thomson or the customers, suppliers, licensors, licensees or partners of the Company or Thomson, including, without limitation, all information concerning trade secrets and the products or projects of the Company or Thomson and/or any -5- improvements therein, all sales and financial information concerning the Company or Thomson, all customer and supplier lists, all information concerning projects in research and development or marketing plans for any such products or projects, all information concerning technical data, designs, patterns, formulae, computer programs, source code, object code, algorithms and subroutines of the Company or Thomson, and all information in any way concerning the products, projects, activities, business or affairs of customers of the Company or Thomson which is furnished to the Executive by the Company or Thomson or any of their respective employees (current or former), agents or customers, as such; provided, however, that the term "confidential material" shall not include information which (a) becomes generally available to the public other than as a result of a disclosure by the Executive, (b) was available to the Executive on a non-confidential basis prior to his employment with the Company or (c) becomes available to the Executive on a non-confidential basis from a source other than the Company or Thomson or any of their agents, franchisees, creditors, suppliers, lessors, lessees, licensors, licensees, partners or customers provided that such source is not bound by a confidentiality agreement with the Company or Thomson or any of such agents or customers. (C) NON-SOLICITATION. During the Restricted Period, the Executive shall not (i) hire or attempt to hire, or (ii) solicit or entice or attempt to solicit or entice away, any person who is (at the applicable time or was within the six month period prior to any such hire, solicitation or enticement) an officer, employee or consultant of the Company or Thomson Legal & Regulatory (including without limitation Dialog) (in the case of clause (i) above) or the Company or Thomson (in the case of clause (ii) above), as applicable, either for his own account or for any individual, firm or corporation, whether or not such person would commit any breach of his contract of employment by reason of leaving the service of the Company, Thomson or Thomson Legal & Regulatory (including without limitation Dialog), as applicable. (D) DEVELOPMENTS. The Executive agrees that all discoveries, inventions, processes, methods and improvements, conceived, developed or otherwise made by the Executive at any time, alone or with others in any way relating to the Company's present or future business or products, whether patentable or subject to copyright protection and whether or not reduced to practice, during the period of the Executive's employment with the Company ("Developments"), shall be the sole property of the Company. The Executive agrees to, and hereby does, assign to the Company all of the Executive's right, title and interest throughout the world in and to all Developments. The Executive agrees that such Developments shall constitute works made for hire under the copyright laws of the United States and hereby assigns to the Company all copyrights, patents and other proprietary rights the Executive may have in such Developments. The Executive shall make and maintain adequate and current written records of all Developments, and the Executive shall disclose all developments promptly, fully and in writing to the Company promptly after development of the same, and at any time upon request, provided, however, that developments excluded under the following paragraph shall be received by the Company in confidence. The Executive has informed the Company in writing of any continuing obligations to any previous employers which require him not to disclose to the Company any information, and the Executive has also informed the Company in writing of any and all confidential information or Developments which the Executive claims as his own and intends to exclude from the restrictions set forth in the previous paragraph because it was developed by the Executive prior to the commencement of his employment by the Company. There shall also be -6- excluded from the restrictions set forth in the previous paragraph any Development made by the Executive (a) which is developed by the Executive without the use of the Company's property or facilities, (b) which does not make any use of confidential information, (c) which is developed by the Executive entirely on his own time, and (d) which does not relate to the Company's business or to the Company's ongoing or planned research and development efforts. At any time at the request of the Company (and at the Company's expense), the Executive shall execute all documents and perform all lawful acts the Company considers necessary or advisable to secure its rights hereunder and to carry out the intent of this Section 5(D). At any time upon the request of the Company, the Executive shall return promptly to the Company all the Company's property, including all copies of all confidential information or Developments. (E) In the event of a breach or threatened breach by the Executive of any of the provisions of Section 5 of this Agreement, the Executive hereby consents and agrees that the Company shall be entitled to an injunction or similar equitable relief from any court of competent jurisdiction restraining the Executive from committing or continuing any such breach or threatened breach or granting specific performance of any act required to be performed by the Executive under any of such provisions, without the necessity of showing any actual damage or that money damages would not afford an adequate remedy and without the necessity of posting any bond or other security. Nothing herein shall be construed as prohibiting the Company from pursuing any other remedies at law or in equity which it may have with respect to any such breach or threatened breach. 6. MISCELLANEOUS. (A) BENEFITS OF AGREEMENT; NO ASSIGNMENTS; NO THIRD-PARTY BENEFICIARIES. (1) This Agreement will bind and inure to the benefit of the parties hereto and their respective heirs, successors, and permitted assigns. (2) Neither party will assign any rights or delegate any obligations hereunder without the consent of the other party (except that the Company may assign its rights and delegate its obligations hereunder to any affiliate of the Company or to any successor to its business, whether by merger or consolidation, sale of stock or of all or substantially all of its assets, or otherwise), and any attempt to do so will be void. (3) Nothing in this Agreement is intended to or will confer any rights or remedies on any person or entity other than the parties hereto, their respective heirs, successors, and permitted assigns. (B) NOTICES. All notices, requests, payments, instructions, or other documents to be given hereunder will be in writing or by written telecommunication, and will be deemed to have been duly given if (i) delivered personally (effective upon delivery), (ii) mailed by registered or certified mail, return receipt requested, postage prepaid (effective five business days after dispatch), (iii) sent by a reputable, established courier service that guarantees next business day delivery (effective the next business day), or (iv) sent by telecopier followed within 24 hours by confirmation by one of the foregoing methods (effective upon receipt of the telecopy in complete, readable form), addressed to the recipient party at its address set forth in the first paragraph hereof (or to such other address as the recipient party may have furnished to the -7- sending party for the purpose pursuant to this section) and, with respect to any notice given on or prior to the Effective Date, with a copy sent to the Purchaser at its address set forth in the Merger Agreement. (C) COUNTERPARTS. This Agreement may be executed by the parties in separate counterparts, each of which when so executed and delivered will be an original, but all of which together will constitute one and the same agreement. In pleading or proving this Agreement, it will not be necessary to produce or account for more than one such counterpart. (D) CAPTIONS. The captions of sections or subsections of this Agreement are for reference only and will not affect the interpretation or construction of this Agreement. (E) CONSTRUCTION. The language used in this Agreement is the language chosen by the parties to express their mutual intent, and no rule of strict construction will be applied against either party. (F) WAIVERS; AMENDMENTS. No waiver of any breach or default hereunder will be valid unless in writing signed by the waiving party. No failure or other delay by any party exercising any right, power, or privilege hereunder will be or operate as a waiver thereof, nor will any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power, or privilege. No amendment or modification of this Agreement will be valid or binding unless in a writing signed by both the Executive and the Company and, with respect to any amendment or modification of this Agreement prior to the Effective Date, by Purchaser. (G) ENTIRE AGREEMENT. This Agreement contains the entire understanding and agreement between the parties, and supersedes any prior understandings or agreements between them, with respect to the subject matter hereof (including, without limitation, the Original Employment Agreement). The parties acknowledge and agree that any and all agreements between the parties relating to stock options granted by the Company (including its predecessors, successors and affiliates) to the Executive, are superseded by and subject to Section 3.07 of the Merger Agreement. (H) GOVERNING LAW. This Agreement will be governed by and interpreted and construed in accordance with the internal laws of the Commonwealth of Massachusetts, without reference to principles of conflicts or choice of law. * * * -8- IN WITNESS WHEREOF, each of the Company and the Executive has executed and delivered this Agreement as an agreement under seal as of the date first above written. EXECUTIVE: /s/ Charles White - ----------------------------------- COMPANY: /s/ Clifford Pollan - ----------------------------------- -9- EX-99.E7 9 a2057464zex-99_e7.txt EXHIBIT 99.E.7 AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT This Amended and Restated Executive Employment Agreement (this "Agreement") dated as of August 6, 2001 is by and between NEWSEDGE CORPORATION (the "Company"), a Delaware corporation having its principal executive offices at 80 Blanchard Road, Burlington, Massachusetts, and Thomas Karanian (the "Executive"). WHEREAS, THE THOMSON CORPORATION ("Parent") proposes to acquire the Company pursuant to that certain Agreement and Plan of Merger dated as of August 6, 2001 ("Merger Agreement") by and among the Company, Parent and INFOBLADE ACQUISITION CORPORATION ("Purchaser"); and WHEREAS, the Executive currently serves as Vice President, Development, Operations and Customer Service of the Company pursuant to an Amended and Restated Executive Employment Agreement dated as of April 1, 2001 (the "Original Employment Agreement") between the Company and the Executive; and WHEREAS, the Company and the Executive desire to amend and restate the Original Employment Agreement in its entirety as of the date hereof and to provide for the employment of Executive by the Company from and after the Effective Date (as hereinafter defined) in accordance with the terms hereof. NOW, THEREFORE, in consideration of the terms, conditions, and mutual covenants hereinafter contained, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto do hereby agree to amend and restate the Original Employment Agreement in its entirety as follows: 1. EFFECTIVENESS; EMPLOYMENT OF EXECUTIVE; TERM. (A) EFFECTIVENESS. The terms and conditions of this Agreement shall become effective automatically, without further act or deed by the Executive or the Company, on the date hereof and the Original Employment Agreement is hereby superseded in its entirety and of no further force and effect, provided, however, that notwithstanding the foregoing, in the event that the Merger Agreement is terminated prior to the Effective Time (as defined in the Merger Agreement), this Agreement shall automatically terminate and have no further force or effect and the Original Employment Agreement shall be automatically reinstated upon such termination of the Merger Agreement. (B) EMPLOYMENT. Subject to the terms and conditions of this Agreement, during the Term (as hereinafter defined), the Company agrees to employ the Executive, and the Executive agrees to serve, as the Company's Vice President, Development, Operations and Customer Service, reporting to the Company's President and Chief Executive Officer (the Executive's "Supervisor") and having such powers and duties consistent with his position as may reasonably be assigned to him from time to time. (C) COMMITMENT. The Executive represents that he is not currently party to or bound by any commitments that might interfere with or impair his performance of such duties and responsibilities or that are inconsistent with his obligations hereunder. The Executive will devote such time and attention to his duties and responsibilities hereunder as reasonably are required, and will not undertake any commitments that would interfere with or impair his performance of such duties and responsibilities. TERM. The term of the Executive's employment under this Agreement shall commence on the Effective Date (as defined in Section 4 below) and shall terminate on the one-year anniversary date of the Effective Date, unless sooner terminated in accordance with Section 3 of this Agreement (the "Term"). Upon the expiration of the Term, the Executive's employment with the Company shall be "at will" and such Executive's employment may be terminated by the Company at any time upon or after such expiration with or without cause, and that upon such termination the Executive shall have no rights under this Agreement including, without limitation, any right to any severance or other termination payments. 2. COMPENSATION. During the Term of the Executive's employment with the Company hereunder, the Company will compensate the Executive as follows: (A) SALARY. The Company will pay to the Executive a base salary, payable in accordance with the payroll practices of the Company, at the rate of $185,000 per annum. The Executive's base salary shall be subject to annual review by the Company and Parent. (B) PERFORMANCE BONUSES. The Executive will be eligible to receive an annual cash bonus at an annualized rate of up to 40% of his base salary, based on the achievement of reasonable individual and Company performance targets to be established by the Company and Parent. (C) STAY BONUS. If the Executive is an active employee of the Company on the one-year anniversary (the "Anniversary Date") of the Effective Date, the Executive will be paid a bonus equal to $185,000. (D) BENEFITS. The Company will promptly reimburse all out-of-pocket expenses reasonably incurred by the Executive in the course of performing his employment duties and responsibilities hereunder, subject to receipt of appropriate documentation. The Company will also provide consistent with his position, Company-paid health and life insurance, and with such other fringe benefits as it from time to time may make generally available to its other senior executives at the Executive's level. 3. TERMINATION. (A) EVENTS CAUSING TERMINATION. The Executive's employment hereunder will terminate upon the occurrence of any of the following events: (1) The Executive's death, or a determination of his legal incapacity by a court of competent jurisdiction; (2) The termination of the Executive's employment hereunder by the Company, by written notice to the Executive, upon the Executive's inability due -2- to illness or injury to perform the essential functions of his position with or without reasonable accommodation; (3) The termination of the Executive's employment hereunder by the Company, for Cause, by written notice to the Executive; (4) The termination of the Executive's employment hereunder by the Company, without Cause, by written notice to the Executive; (5) The termination of the Executive's employment hereunder by the Executive, for Good Reason, by thirty (30) days prior written notice to the Company; or (6) The expiration of the Term of this Agreement under Section 1(D) hereof. (B) "CAUSE" AND "GOOD REASON" DEFINED. For purposes of this Agreement: "Cause" means: (a) the Executive's conviction of any crime (whether or not involving the Company) (other than unintentional motor vehicle felonies); (b) any act of theft, fraud or embezzlement by the Executive in connection with his work with the Company; or (c) the Executive's continuing, repeated and willful failure or refusal to perform, or continuing, repeated and gross negligence in the performance of, his material duties and services to the Company (other than due to his incapacity due to illness or injury), provided that such failure or refusal or gross negligence continues uncorrected for a period of 30 days after the Executive shall have received written notice from the Company setting forth with specificity the nature of such failure, refusal, or gross negligence; (d) the breach of this Agreement by the Executive; or (e) the willful violation of Federal and/or state securities laws. "GOOD REASON" means the occurrence of one or more of the following occurring without the specific written consent of the Executive: (i) a material reduction of duties of the Executive, excluding any such reduction in duties reasonably occurring as a result of the transactions contemplated by the Merger Agreement; (ii) a material demotion, or a reduction in base salary of the Executive; (iii) any requirement that the Executive's principal place of work be relocated outside of the Commonwealth of Massachusetts or more than twenty-five (25) miles from its location as of the date of this Agreement; (iv) the Company's breach of any term of this Agreement which is not fully remedied within fifteen (15) calendar days after receipt by the Company of a written notice from the Executive of such breach. (C) ADJUSTMENTS UPON TERMINATION. Notwithstanding any other provision of this Agreement: (1) If the Executive's employment with the Company terminates during the Term pursuant Section 3(A)(4) (by the Company, without Cause) or Section 3(A)(5) (by the Executive, for Good Reason), then, for a twelve (12) month period immediately following the date of such termination, the Company will continue to pay the Executive a base salary at a rate equal to that at which he was being paid at the time of termination, and (subject to Section 3(D) below), will likewise continue to provide the Executive with the benefits that he was receiving at the time of termination (or, if the Company is unable to do so because -3- such benefits may only be provided to current employees, subject to the provisions of Section 3(D) it will provide the Executive with the cash value thereof). In addition to the payments and benefits specified above, the Company will pay the Executive on the date of termination a lump sum payment for all accrued unused vacation time. It is agreed and understood that the Company's duty to make the payments and provide the benefits described in this Section 3(C)(1) shall be conditioned upon the Executive's execution of a satisfactory general release in favor of the Company and the Executive's compliance with Section 5 hereof. (2) If the Executive's employment with the Company terminates during the Term other than pursuant to Section 3(A)(4) (by the Company, without Cause) or Section 3(A)(5) (by the Executive, with Good Reason), then the rights of the Executive to receive future compensation pursuant to Section 2 and Section 3(C)(1) hereof, and all other rights of the Executive hereunder, will cease as of the date of such termination except as may be required by law. As of the date of such termination, the Executive shall receive a lump sum payment for all accrued unpaid wages and accrued unused vacation time. (D) NO DUTY TO MITIGATE; TERMINATION OF BENEFITS. The Executive shall not be required to mitigate the amount of any compensation payable to him pursuant to Section 3(C)(1) hereof, whether by seeking other employment or otherwise. If, during the period during which he is receiving such compensation, the Executive obtains new full-time employment providing him with benefits comparable to those he is entitled to receive from the Company hereunder, then, when the Executive begins receiving such benefits from his new employer, the Executive will no longer be entitled to receive such benefits from the Company but will continue to be entitled to receive payment of his base salary (and other non-duplicative benefits) as provided for herein. 4. CHANGE OF CONTROL Upon the date (the "Effective Date") that is the earlier to occur of (x) the date that Purchaser pays for the Shares pursuant to the Offer and (y) the date of the Effective Time, the Executive (if such Executive is still employed by the Company immediately prior to such date) will be paid a bonus in an amount equal to the amount that would be payable to the Executive under Section 4(A) of the Original Employment Agreement upon the consummation of the Merger as if such Section 4(A) were in effect as of the Effective Time. 5. CERTAIN COVENANTS OF THE EXECUTIVE. The Executive acknowledges that (i) the Company, Parent and Parent's affiliates (collectively, "Thomson") are engaged and in the future will be engaged in the businesses of developing, operating, offering for sale and selling news or other current information or software-based solutions pertaining thereto to corporations and other businesses, government agencies, universities and other academic institutions and professional services providers (e.g. law, accounting and consulting firms) (the foregoing, together with any other businesses or operations over which Executive has substantial responsibility from the date hereof to the date of termination of the Executive's employment with the Company (or an affiliate thereof), being -4- hereinafter referred to as the "Restricted Activity"); (ii) his services to the Company and Thomson have been and will be special and unique; (iii) his work for the Company and Thomson will give him access to trade secrets of and confidential information concerning the Company, Thomson and their affiliated companies; (iv) the Restricted Activity is national and international in scope; (v) the Company would not have entered into this Agreement but for the agreements and covenants contained in this Section 5; (vi) he has the means to support himself and his dependents other than by engaging in the Restricted Activity and the provisions of this Section 5 will not impair such ability; and (vii) the agreements and covenants contained in this Section 5 are essential to protect the business and goodwill of the Company, Thomson and their affiliates. In order to induce the Company to enter into this Agreement, and in consideration for the benefits received by the Executive pursuant to this Agreement, and other good and valuable consideration the receipt of which is hereby acknowledged, the Executive covenants and agrees as follows: (A) NON-COMPETE. During the Restricted Period (as hereinafter defined), the Executive shall not in the United States of America, or in any foreign country, directly or indirectly, (i) engage in the Restricted Activity for the benefit of any person or entity other than the Company, Thomson and their affiliated companies; (ii) be an employee or consultant of, or provide services to, Factiva or Lexus/Nexis or any of their respective direct or indirect subsidiaries; (iii) have an interest in any person engaged in the Restricted Activity in any capacity, including, without limitation, as a partner, shareholder, officer, director, principal, agent, employee, trustee or consultant or any other relationship or capacity; provided, however, the Executive may own, directly or indirectly, solely as an investment, securities of any person which are publicly traded if the Executive (a) is not a controlling person of, or a member of a group which controls, such person, and (b) does not, directly or indirectly, own 1% or more of any class of securities of such person; or (iv) interfere with business relationships (whether formed heretofore or hereafter) between the Company or any of its affiliates and customers or suppliers of the Company or any of its affiliates. The term "Restricted Period" shall mean the period ending on the date that is (x) with respect to clause (ii) of this Section 5(A), eighteen (18) months following the end of the Executive's employment by the Company (or any affiliate of the Company) whether or not pursuant to this Agreement and (y) with respect to clauses (i), (iii) and (iv) of this Section 5(A), twelve (12) months following the end of the Executive's employment by the Company (or any affiliates of the Company) whether or not pursuant to this Agreement. (B) NON-DISCLOSURE. The Executive shall, during the Term of this Agreement and at all times thereafter, treat as confidential and, except as required in the performance of his duties and responsibilities under this Agreement, not disclose, publish or otherwise make available to the public or to any individual, firm or corporation any confidential material (as hereinafter defined). The Executive agrees that all confidential material, together with all notes and records of the Executive relating thereto, and all copies or facsimiles thereof in the possession of the Executive, are the exclusive property of the Company or Thomson, as the case may be, and the Executive agrees to return such material to the Company promptly upon the termination of the Executive's employment with the Company. For the purposes hereof, the term "confidential material" shall mean all information acquired by the Executive in the course of the Executive's employment with the Company in any way concerning the products, projects, activities, business or affairs of the Company or Thomson or the customers, suppliers, licensors, licensees or partners of the Company or Thomson, including, without limitation, all information concerning trade secrets and the products or projects of the Company or Thomson and/or any -5- improvements therein, all sales and financial information concerning the Company or Thomson, all customer and supplier lists, all information concerning projects in research and development or marketing plans for any such products or projects, all information concerning technical data, designs, patterns, formulae, computer programs, source code, object code, algorithms and subroutines of the Company or Thomson, and all information in any way concerning the products, projects, activities, business or affairs of customers of the Company or Thomson which is furnished to the Executive by the Company or Thomson or any of their respective employees (current or former), agents or customers, as such; provided, however, that the term "confidential material" shall not include information which (a) becomes generally available to the public other than as a result of a disclosure by the Executive, (b) was available to the Executive on a non-confidential basis prior to his employment with the Company or (c) becomes available to the Executive on a non-confidential basis from a source other than the Company or Thomson or any of their agents, franchisees, creditors, suppliers, lessors, lessees, licensors, licensees, partners or customers provided that such source is not bound by a confidentiality agreement with the Company or Thomson or any of such agents or customers. (C) NON-SOLICITATION. During the Restricted Period, the Executive shall not (i) hire or attempt to hire, or (ii) solicit or entice or attempt to solicit or entice away, any person who is (at the applicable time or was within the six month period prior to any such hire, solicitation or enticement) an officer, employee or consultant of the Company or Thomson Legal & Regulatory (including without limitation Dialog) (in the case of clause (i) above) or the Company or Thomson (in the case of clause (ii) above), as applicable, either for his own account or for any individual, firm or corporation, whether or not such person would commit any breach of his contract of employment by reason of leaving the service of the Company, Thomson or Thomson Legal & Regulatory (including without limitation Dialog), as applicable. (D) DEVELOPMENTS. The Executive agrees that all discoveries, inventions, processes, methods and improvements, conceived, developed or otherwise made by the Executive at any time, alone or with others in any way relating to the Company's present or future business or products, whether patentable or subject to copyright protection and whether or not reduced to practice, during the period of the Executive's employment with the Company ("Developments"), shall be the sole property of the Company. The Executive agrees to, and hereby does, assign to the Company all of the Executive's right, title and interest throughout the world in and to all Developments. The Executive agrees that such Developments shall constitute works made for hire under the copyright laws of the United States and hereby assigns to the Company all copyrights, patents and other proprietary rights the Executive may have in such Developments. The Executive shall make and maintain adequate and current written records of all Developments, and the Executive shall disclose all developments promptly, fully and in writing to the Company promptly after development of the same, and at any time upon request, provided, however, that developments excluded under the following paragraph shall be received by the Company in confidence. The Executive has informed the Company in writing of any continuing obligations to any previous employers which require him not to disclose to the Company any information, and the Executive has also informed the Company in writing of any and all confidential information or Developments which the Executive claims as his own and intends to exclude from the restrictions set forth in the previous paragraph because it was developed by the Executive prior to the commencement of his employment by the Company. There shall also be -6- excluded from the restrictions set forth in the previous paragraph any Development made by the Executive (a) which is developed by the Executive without the use of the Company's property or facilities, (b) which does not make any use of confidential information, (c) which is developed by the Executive entirely on his own time, and (d) which does not relate to the Company's business or to the Company's ongoing or planned research and development efforts. At any time at the request of the Company (and at the Company's expense), the Executive shall execute all documents and perform all lawful acts the Company considers necessary or advisable to secure its rights hereunder and to carry out the intent of this Section 5(D). At any time upon the request of the Company, the Executive shall return promptly to the Company all the Company's property, including all copies of all confidential information or Developments. (E) In the event of a breach or threatened breach by the Executive of any of the provisions of Section 5 of this Agreement, the Executive hereby consents and agrees that the Company shall be entitled to an injunction or similar equitable relief from any court of competent jurisdiction restraining the Executive from committing or continuing any such breach or threatened breach or granting specific performance of any act required to be performed by the Executive under any of such provisions, without the necessity of showing any actual damage or that money damages would not afford an adequate remedy and without the necessity of posting any bond or other security. Nothing herein shall be construed as prohibiting the Company from pursuing any other remedies at law or in equity which it may have with respect to any such breach or threatened breach. 6. MISCELLANEOUS. (A) BENEFITS OF AGREEMENT; NO ASSIGNMENTS; NO THIRD-PARTY BENEFICIARIES. (1) This Agreement will bind and inure to the benefit of the parties hereto and their respective heirs, successors, and permitted assigns. (2) Neither party will assign any rights or delegate any obligations hereunder without the consent of the other party (except that the Company may assign its rights and delegate its obligations hereunder to any affiliate of the Company or to any successor to its business, whether by merger or consolidation, sale of stock or of all or substantially all of its assets, or otherwise), and any attempt to do so will be void. (3) Nothing in this Agreement is intended to or will confer any rights or remedies on any person or entity other than the parties hereto, their respective heirs, successors, and permitted assigns. (B) NOTICES. All notices, requests, payments, instructions, or other documents to be given hereunder will be in writing or by written telecommunication, and will be deemed to have been duly given if (i) delivered personally (effective upon delivery), (ii) mailed by registered or certified mail, return receipt requested, postage prepaid (effective five business days after dispatch), (iii) sent by a reputable, established courier service that guarantees next business day delivery (effective the next business day), or (iv) sent by telecopier followed within 24 hours by confirmation by one of the foregoing methods (effective upon receipt of the telecopy in complete, readable form), addressed to the recipient party at its address set forth in the first paragraph hereof (or to such other address as the recipient party may have furnished to the -7- sending party for the purpose pursuant to this section) and, with respect to any notice given on or prior to the Effective Date, with a copy sent to the Purchaser at its address set forth in the Merger Agreement. (C) COUNTERPARTS. This Agreement may be executed by the parties in separate counterparts, each of which when so executed and delivered will be an original, but all of which together will constitute one and the same agreement. In pleading or proving this Agreement, it will not be necessary to produce or account for more than one such counterpart. (D) CAPTIONS. The captions of sections or subsections of this Agreement are for reference only and will not affect the interpretation or construction of this Agreement. (E) CONSTRUCTION. The language used in this Agreement is the language chosen by the parties to express their mutual intent, and no rule of strict construction will be applied against either party. (F) WAIVERS; AMENDMENTS. No waiver of any breach or default hereunder will be valid unless in writing signed by the waiving party. No failure or other delay by any party exercising any right, power, or privilege hereunder will be or operate as a waiver thereof, nor will any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power, or privilege. No amendment or modification of this Agreement will be valid or binding unless in a writing signed by both the Executive and the Company and, with respect to any amendment or modification of this Agreement prior to the Effective Date, by Purchaser. (G) ENTIRE AGREEMENT. This Agreement contains the entire understanding and agreement between the parties, and supersedes any prior understandings or agreements between them, with respect to the subject matter hereof (including, without limitation, the Original Employment Agreement). The parties acknowledge and agree that any and all agreements between the parties relating to stock options granted by the Company (including its predecessors, successors and affiliates) to the Executive, are superseded by and subject to Section 3.07 of the Merger Agreement. (H) GOVERNING LAW. This Agreement will be governed by and interpreted and construed in accordance with the internal laws of the Commonwealth of Massachusetts, without reference to principles of conflicts or choice of law. * * * -8- IN WITNESS WHEREOF, each of the Company and the Executive has executed and delivered this Agreement as an agreement under seal as of the date first above written. EXECUTIVE: /s/ Thomas Karanan - ----------------------------------- COMPANY: /s/ Clifford Pollan - ----------------------------------- -9- EX-99.E8 10 a2057464zex-99_e8.txt EXHIBIT 99.E.8 AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT This Amended and Restated Executive Employment Agreement (this "Agreement") dated as of August 6, 2001 is by and between NEWSEDGE CORPORATION (the "Company"), a Delaware corporation having its principal executive offices at 80 Blanchard Road, Burlington, Massachusetts, and John Crozier (the "Executive"). WHEREAS, THE THOMSON CORPORATION ("Parent") proposes to acquire the Company pursuant to that certain Agreement and Plan of Merger dated as of August 6, 2001 ("Merger Agreement") by and among the Company, Parent and INFOBLADE ACQUISITION CORPORATION ("Purchaser"); and WHEREAS, the Executive currently serves as Vice President, North American Sales of the Company pursuant to an Amended and Restated Executive Employment Agreement dated as of April 1, 2001 (the "Original Employment Agreement") between the Company and the Executive; and WHEREAS, the Company and the Executive desire to amend and restate the Original Employment Agreement in its entirety as of the date hereof and to provide for the employment of Executive by the Company from and after the Effective Date (as hereinafter defined) in accordance with the terms hereof. NOW, THEREFORE, in consideration of the terms, conditions, and mutual covenants hereinafter contained, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto do hereby agree to amend and restate the Original Employment Agreement in its entirety as follows: 1. EFFECTIVENESS; EMPLOYMENT OF EXECUTIVE; TERM. (A) EFFECTIVENESS. The terms and conditions of this Agreement shall become effective automatically, without further act or deed by the Executive or the Company, on the date hereof and the Original Employment Agreement is hereby superseded in its entirety and of no further force and effect, provided, however, that notwithstanding the foregoing, in the event that the Merger Agreement is terminated prior to the Effective Time (as defined in the Merger Agreement), this Agreement shall automatically terminate and have no further force or effect and the Original Employment Agreement shall be automatically reinstated upon such termination of the Merger Agreement. (B) EMPLOYMENT. Subject to the terms and conditions of this Agreement, during the Term (as hereinafter defined), the Company agrees to employ the Executive, and the Executive agrees to serve, as the Company's Vice President, North American Sales, reporting to the Company's President and Chief Executive Officer (the Executive's "Supervisor") and having such powers and duties consistent with his position as may reasonably be assigned to him from time to time. (C) COMMITMENT. The Executive represents that he is not currently party to or bound by any commitments that might interfere with or impair his performance of such duties and responsibilities or that are inconsistent with his obligations hereunder. The Executive will devote such time and attention to his duties and responsibilities hereunder as reasonably are required, and will not undertake any commitments that would interfere with or impair his performance of such duties and responsibilities. TERM. The term of the Executive's employment under this Agreement shall commence on the Effective Date (as defined in Section 4 below) and shall terminate on the one-year anniversary date of the Effective Date, unless sooner terminated in accordance with Section 3 of this Agreement (the "Term"). Upon the expiration of the Term, the Executive's employment with the Company shall be "at will" and such Executive's employment may be terminated by the Company at any time upon or after such expiration with or without cause, and that upon such termination the Executive shall have no rights under this Agreement including, without limitation, any right to any severance or other termination payments. 2. COMPENSATION. During the Term of the Executive's employment with the Company hereunder, the Company will compensate the Executive as follows: (A) SALARY. The Company will pay to the Executive a base salary, payable in accordance with the payroll practices of the Company, at the rate of $180,000 per annum. The Executive's base salary shall be subject to annual review by the Company and Parent. (B) PERFORMANCE BONUSES. The Executive will be eligible to receive an annual cash bonus at an annualized rate of up to 50% of his base salary, based on the achievement of reasonable individual and Company performance targets to be established by the Company and Parent. (C) STAY BONUS. If the Executive is an active employee of the Company on the one-year anniversary (the "Anniversary Date") of the Effective Date, the Executive will be paid a bonus equal to $180,000. (D) BENEFITS. The Company will promptly reimburse all out-of-pocket expenses reasonably incurred by the Executive in the course of performing his employment duties and responsibilities hereunder, subject to receipt of appropriate documentation. The Company will also provide consistent with his position, Company-paid health and life insurance, and with such other fringe benefits as it from time to time may make generally available to its other senior executives at the Executive's level. 3. TERMINATION. (A) EVENTS CAUSING TERMINATION. The Executive's employment hereunder will terminate upon the occurrence of any of the following events: (1) The Executive's death, or a determination of his legal incapacity by a court of competent jurisdiction; (2) The termination of the Executive's employment hereunder by the Company, by written notice to the Executive, upon the Executive's inability due -2- to illness or injury to perform the essential functions of his position with or without reasonable accommodation; (3) The termination of the Executive's employment hereunder by the Company, for Cause, by written notice to the Executive; (4) The termination of the Executive's employment hereunder by the Company, without Cause, by written notice to the Executive; (5) The termination of the Executive's employment hereunder by the Executive, for Good Reason, by thirty (30) days prior written notice to the Company; or (6) The expiration of the Term of this Agreement under Section 1(D) hereof. (B) "CAUSE" AND "GOOD REASON" DEFINED. For purposes of this Agreement: "Cause" means: (a) the Executive's conviction of any crime (whether or not involving the Company) (other than unintentional motor vehicle felonies); (b) any act of theft, fraud or embezzlement by the Executive in connection with his work with the Company; or (c) the Executive's continuing, repeated and willful failure or refusal to perform, or continuing, repeated and gross negligence in the performance of, his material duties and services to the Company (other than due to his incapacity due to illness or injury), provided that such failure or refusal or gross negligence continues uncorrected for a period of 30 days after the Executive shall have received written notice from the Company setting forth with specificity the nature of such failure, refusal, or gross negligence; (d) the breach of this Agreement by the Executive; or (e) the willful violation of Federal and/or state securities laws. "GOOD REASON" means the occurrence of one or more of the following occurring without the specific written consent of the Executive: (i) a material reduction of duties of the Executive, excluding any such reduction in duties reasonably occurring as a result of the transactions contemplated by the Merger Agreement; (ii) a material demotion, or a reduction in base salary of the Executive; (iii) any requirement that the Executive's principal place of work be relocated outside of the Commonwealth of Massachusetts or more than twenty-five (25) miles from its location as of the date of this Agreement; (iv) the Company's breach of any term of this Agreement which is not fully remedied within fifteen (15) calendar days after receipt by the Company of a written notice from the Executive of such breach. (C) ADJUSTMENTS UPON TERMINATION. Notwithstanding any other provision of this Agreement: (1) If the Executive's employment with the Company terminates during the Term pursuant Section 3(A)(4) (by the Company, without Cause) or Section 3(A)(5) (by the Executive, for Good Reason), then, for a twelve (12) month period immediately following the date of such termination, the Company will continue to pay the Executive a base salary at a rate equal to that at which he was being paid at the time of termination, and (subject to Section 3(D) below), will likewise continue to provide the Executive with the benefits that he was receiving at the time of termination (or, if the Company is unable to do so because -3- such benefits may only be provided to current employees, subject to the provisions of Section 3(D) it will provide the Executive with the cash value thereof). In addition to the payments and benefits specified above, the Company will pay the Executive on the date of termination a lump sum payment for all accrued unused vacation time. It is agreed and understood that the Company's duty to make the payments and provide the benefits described in this Section 3(C)(1) shall be conditioned upon the Executive's execution of a satisfactory general release in favor of the Company and the Executive's compliance with Section 5 hereof. (2) If the Executive's employment with the Company terminates during the Term other than pursuant to Section 3(A)(4) (by the Company, without Cause) or Section 3(A)(5) (by the Executive, with Good Reason), then the rights of the Executive to receive future compensation pursuant to Section 2 and Section 3(C)(1) hereof, and all other rights of the Executive hereunder, will cease as of the date of such termination except as may be required by law. As of the date of such termination, the Executive shall receive a lump sum payment for all accrued unpaid wages and accrued unused vacation time. (D) NO DUTY TO MITIGATE; TERMINATION OF BENEFITS. The Executive shall not be required to mitigate the amount of any compensation payable to him pursuant to Section 3(C)(1) hereof, whether by seeking other employment or otherwise. If, during the period during which he is receiving such compensation, the Executive obtains new full-time employment providing him with benefits comparable to those he is entitled to receive from the Company hereunder, then, when the Executive begins receiving such benefits from his new employer, the Executive will no longer be entitled to receive such benefits from the Company but will continue to be entitled to receive payment of his base salary (and other non-duplicative benefits) as provided for herein. 4. CHANGE OF CONTROL Upon the date (the "Effective Date") that is the earlier to occur of (x) the date that Purchaser pays for the Shares pursuant to the Offer and (y) the date of the Effective Time, the Executive (if such Executive is still employed by the Company immediately prior to such date) will be paid a bonus in an amount equal to the amount that would be payable to the Executive under Section 4(A) of the Original Employment Agreement upon the consummation of the Merger as if such Section 4(A) were in effect as of the Effective Time. 5. CERTAIN COVENANTS OF THE EXECUTIVE. The Executive acknowledges that (i) the Company, Parent and Parent's affiliates (collectively, "Thomson") are engaged and in the future will be engaged in the businesses of developing, operating, offering for sale and selling news or other current information or software-based solutions pertaining thereto to corporations and other businesses, government agencies, universities and other academic institutions and professional services providers (e.g. law, accounting and consulting firms) (the foregoing, together with any other businesses or operations over which Executive has substantial responsibility from the date hereof to the date of termination of the Executive's employment with the Company (or an affiliate thereof), being -4- hereinafter referred to as the "Restricted Activity"); (ii) his services to the Company and Thomson have been and will be special and unique; (iii) his work for the Company and Thomson will give him access to trade secrets of and confidential information concerning the Company, Thomson and their affiliated companies; (iv) the Restricted Activity is national and international in scope; (v) the Company would not have entered into this Agreement but for the agreements and covenants contained in this Section 5; (vi) he has the means to support himself and his dependents other than by engaging in the Restricted Activity and the provisions of this Section 5 will not impair such ability; and (vii) the agreements and covenants contained in this Section 5 are essential to protect the business and goodwill of the Company, Thomson and their affiliates. In order to induce the Company to enter into this Agreement, and in consideration for the benefits received by the Executive pursuant to this Agreement, and other good and valuable consideration the receipt of which is hereby acknowledged, the Executive covenants and agrees as follows: (A) NON-COMPETE. During the Restricted Period (as hereinafter defined), the Executive shall not in the United States of America, or in any foreign country, directly or indirectly, (i) engage in the Restricted Activity for the benefit of any person or entity other than the Company, Thomson and their affiliated companies; (ii) be an employee or consultant of, or provide services to, Factiva or Lexus/Nexis or any of their respective direct or indirect subsidiaries; (iii) have an interest in any person engaged in the Restricted Activity in any capacity, including, without limitation, as a partner, shareholder, officer, director, principal, agent, employee, trustee or consultant or any other relationship or capacity; provided, however, the Executive may own, directly or indirectly, solely as an investment, securities of any person which are publicly traded if the Executive (a) is not a controlling person of, or a member of a group which controls, such person, and (b) does not, directly or indirectly, own 1% or more of any class of securities of such person; or (iv) interfere with business relationships (whether formed heretofore or hereafter) between the Company or any of its affiliates and customers or suppliers of the Company or any of its affiliates. The term "Restricted Period" shall mean the period ending on the date that is (x) with respect to clause (ii) of this Section 5(A), eighteen (18) months following the end of the Executive's employment by the Company (or any affiliate of the Company) whether or not pursuant to this Agreement and (y) with respect to clauses (i), (iii) and (iv) of this Section 5(A), twelve (12) months following the end of the Executive's employment by the Company (or any affiliates of the Company) whether or not pursuant to this Agreement. (B) NON-DISCLOSURE. The Executive shall, during the Term of this Agreement and at all times thereafter, treat as confidential and, except as required in the performance of his duties and responsibilities under this Agreement, not disclose, publish or otherwise make available to the public or to any individual, firm or corporation any confidential material (as hereinafter defined). The Executive agrees that all confidential material, together with all notes and records of the Executive relating thereto, and all copies or facsimiles thereof in the possession of the Executive, are the exclusive property of the Company or Thomson, as the case may be, and the Executive agrees to return such material to the Company promptly upon the termination of the Executive's employment with the Company. For the purposes hereof, the term "confidential material" shall mean all information acquired by the Executive in the course of the Executive's employment with the Company in any way concerning the products, projects, activities, business or affairs of the Company or Thomson or the customers, suppliers, licensors, licensees or partners of the Company or Thomson, including, without limitation, all information concerning trade secrets and the products or projects of the Company or Thomson and/or any -5- improvements therein, all sales and financial information concerning the Company or Thomson, all customer and supplier lists, all information concerning projects in research and development or marketing plans for any such products or projects, all information concerning technical data, designs, patterns, formulae, computer programs, source code, object code, algorithms and subroutines of the Company or Thomson, and all information in any way concerning the products, projects, activities, business or affairs of customers of the Company or Thomson which is furnished to the Executive by the Company or Thomson or any of their respective employees (current or former), agents or customers, as such; provided, however, that the term "confidential material" shall not include information which (a) becomes generally available to the public other than as a result of a disclosure by the Executive, (b) was available to the Executive on a non-confidential basis prior to his employment with the Company or (c) becomes available to the Executive on a non-confidential basis from a source other than the Company or Thomson or any of their agents, franchisees, creditors, suppliers, lessors, lessees, licensors, licensees, partners or customers provided that such source is not bound by a confidentiality agreement with the Company or Thomson or any of such agents or customers. (C) NON-SOLICITATION. During the Restricted Period, the Executive shall not (i) hire or attempt to hire, or (ii) solicit or entice or attempt to solicit or entice away, any person who is (at the applicable time or was within the six month period prior to any such hire, solicitation or enticement) an officer, employee or consultant of the Company or Thomson Legal & Regulatory (including without limitation Dialog) (in the case of clause (i) above) or the Company or Thomson (in the case of clause (ii) above), as applicable, either for his own account or for any individual, firm or corporation, whether or not such person would commit any breach of his contract of employment by reason of leaving the service of the Company, Thomson or Thomson Legal & Regulatory (including without limitation Dialog), as applicable. (D) DEVELOPMENTS. The Executive agrees that all discoveries, inventions, processes, methods and improvements, conceived, developed or otherwise made by the Executive at any time, alone or with others in any way relating to the Company's present or future business or products, whether patentable or subject to copyright protection and whether or not reduced to practice, during the period of the Executive's employment with the Company ("Developments"), shall be the sole property of the Company. The Executive agrees to, and hereby does, assign to the Company all of the Executive's right, title and interest throughout the world in and to all Developments. The Executive agrees that such Developments shall constitute works made for hire under the copyright laws of the United States and hereby assigns to the Company all copyrights, patents and other proprietary rights the Executive may have in such Developments. The Executive shall make and maintain adequate and current written records of all Developments, and the Executive shall disclose all developments promptly, fully and in writing to the Company promptly after development of the same, and at any time upon request, provided, however, that developments excluded under the following paragraph shall be received by the Company in confidence. The Executive has informed the Company in writing of any continuing obligations to any previous employers which require him not to disclose to the Company any information, and the Executive has also informed the Company in writing of any and all confidential information or Developments which the Executive claims as his own and intends to exclude from the restrictions set forth in the previous paragraph because it was developed by the Executive prior to the commencement of his employment by the Company. There shall also be -6- excluded from the restrictions set forth in the previous paragraph any Development made by the Executive (a) which is developed by the Executive without the use of the Company's property or facilities, (b) which does not make any use of confidential information, (c) which is developed by the Executive entirely on his own time, and (d) which does not relate to the Company's business or to the Company's ongoing or planned research and development efforts. At any time at the request of the Company (and at the Company's expense), the Executive shall execute all documents and perform all lawful acts the Company considers necessary or advisable to secure its rights hereunder and to carry out the intent of this Section 5(D). At any time upon the request of the Company, the Executive shall return promptly to the Company all the Company's property, including all copies of all confidential information or Developments. (E) In the event of a breach or threatened breach by the Executive of any of the provisions of Section 5 of this Agreement, the Executive hereby consents and agrees that the Company shall be entitled to an injunction or similar equitable relief from any court of competent jurisdiction restraining the Executive from committing or continuing any such breach or threatened breach or granting specific performance of any act required to be performed by the Executive under any of such provisions, without the necessity of showing any actual damage or that money damages would not afford an adequate remedy and without the necessity of posting any bond or other security. Nothing herein shall be construed as prohibiting the Company from pursuing any other remedies at law or in equity which it may have with respect to any such breach or threatened breach. 6. MISCELLANEOUS. (A) BENEFITS OF AGREEMENT; NO ASSIGNMENTS; NO THIRD-PARTY BENEFICIARIES. (1) This Agreement will bind and inure to the benefit of the parties hereto and their respective heirs, successors, and permitted assigns. (2) Neither party will assign any rights or delegate any obligations hereunder without the consent of the other party (except that the Company may assign its rights and delegate its obligations hereunder to any affiliate of the Company or to any successor to its business, whether by merger or consolidation, sale of stock or of all or substantially all of its assets, or otherwise), and any attempt to do so will be void. (3) Nothing in this Agreement is intended to or will confer any rights or remedies on any person or entity other than the parties hereto, their respective heirs, successors, and permitted assigns. (B) NOTICES. All notices, requests, payments, instructions, or other documents to be given hereunder will be in writing or by written telecommunication, and will be deemed to have been duly given if (i) delivered personally (effective upon delivery), (ii) mailed by registered or certified mail, return receipt requested, postage prepaid (effective five business days after dispatch), (iii) sent by a reputable, established courier service that guarantees next business day delivery (effective the next business day), or (iv) sent by telecopier followed within 24 hours by confirmation by one of the foregoing methods (effective upon receipt of the telecopy in complete, readable form), addressed to the recipient party at its address set forth in the first paragraph hereof (or to such other address as the recipient party may have furnished to the -7- sending party for the purpose pursuant to this section) and, with respect to any notice given on or prior to the Effective Date, with a copy sent to the Purchaser at its address set forth in the Merger Agreement. (C) COUNTERPARTS. This Agreement may be executed by the parties in separate counterparts, each of which when so executed and delivered will be an original, but all of which together will constitute one and the same agreement. In pleading or proving this Agreement, it will not be necessary to produce or account for more than one such counterpart. (D) CAPTIONS. The captions of sections or subsections of this Agreement are for reference only and will not affect the interpretation or construction of this Agreement. (E) CONSTRUCTION. The language used in this Agreement is the language chosen by the parties to express their mutual intent, and no rule of strict construction will be applied against either party. (F) WAIVERS; AMENDMENTS. No waiver of any breach or default hereunder will be valid unless in writing signed by the waiving party. No failure or other delay by any party exercising any right, power, or privilege hereunder will be or operate as a waiver thereof, nor will any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power, or privilege. No amendment or modification of this Agreement will be valid or binding unless in a writing signed by both the Executive and the Company and, with respect to any amendment or modification of this Agreement prior to the Effective Date, by Purchaser. (G) ENTIRE AGREEMENT. This Agreement contains the entire understanding and agreement between the parties, and supersedes any prior understandings or agreements between them, with respect to the subject matter hereof (including, without limitation, the Original Employment Agreement). The parties acknowledge and agree that any and all agreements between the parties relating to stock options granted by the Company (including its predecessors, successors and affiliates) to the Executive, are superseded by and subject to Section 3.07 of the Merger Agreement. (H) GOVERNING LAW. This Agreement will be governed by and interpreted and construed in accordance with the internal laws of the Commonwealth of Massachusetts, without reference to principles of conflicts or choice of law. * * * -8- IN WITNESS WHEREOF, each of the Company and the Executive has executed and delivered this Agreement as an agreement under seal as of the date first above written. EXECUTIVE: /s/ John Crossier - ----------------------------------- COMPANY: /s/ Clifford Pollan - ----------------------------------- -9- EX-99.E9 11 a2057464zex-99_e9.txt EXHIBIT 99.E.9 AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT This Amended and Restated Executive Employment Agreement (this "Agreement") dated as of August 6, 2001 is by and between NEWSEDGE CORPORATION (the "Company"), a Delaware corporation having its principal executive offices at 80 Blanchard Road, Burlington, Massachusetts, and David Scott (the "Executive"). WHEREAS, THE THOMSON CORPORATION ("Parent") proposes to acquire the Company pursuant to that certain Agreement and Plan of Merger dated as of August 6, 2001 ("Merger Agreement") by and among the Company, Parent and INFOBLADE ACQUISITION CORPORATION ("Purchaser"); and WHEREAS, the Executive currently serves as Vice President, Corporate Marketing of the Company pursuant to an Executive Employment Agreement dated as of January 18, 2001 (the "Original Employment Agreement") between the Company and the Executive; and WHEREAS, the Company and the Executive desire to amend and restate the Original Employment Agreement in its entirety as of the date hereof and to provide for the employment of Executive by the Company from and after the Effective Date (as hereinafter defined) in accordance with the terms hereof. NOW, THEREFORE, in consideration of the terms, conditions, and mutual covenants hereinafter contained, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto do hereby agree to amend and restate the Original Employment Agreement in its entirety as follows: 1. EFFECTIVENESS; EMPLOYMENT OF EXECUTIVE; TERM. (A) EFFECTIVENESS. The terms and conditions of this Agreement shall become effective automatically, without further act or deed by the Executive or the Company, on the date hereof and the Original Employment Agreement is hereby superseded in its entirety and of no further force and effect, provided, however, that notwithstanding the foregoing, in the event that the Merger Agreement is terminated prior to the Effective Time (as defined in the Merger Agreement), this Agreement shall automatically terminate and have no further force or effect and the Original Employment Agreement shall be automatically reinstated upon such termination of the Merger Agreement. (B) EMPLOYMENT. Subject to the terms and conditions of this Agreement, during the Term (as hereinafter defined), the Company agrees to employ the Executive, and the Executive agrees to serve, as the Company's Vice President, Corporate Marketing, reporting to the Company's President and Chief Executive Officer (the Executive's "Supervisor") and having such powers and duties consistent with his position as may reasonably be assigned to him from time to time. (C) COMMITMENT. The Executive represents that he is not currently party to or bound by any commitments that might interfere with or impair his performance of such duties and responsibilities or that are inconsistent with his obligations hereunder. The Executive will devote such time and attention to his duties and responsibilities hereunder as reasonably are required, and will not undertake any commitments that would interfere with or impair his performance of such duties and responsibilities. TERM. The term of the Executive's employment under this Agreement shall commence on the Effective Date (as defined in Section 4 below) and shall terminate on the one-year anniversary date of the Effective Date, unless sooner terminated in accordance with Section 3 of this Agreement (the "Term"). Upon the expiration of the Term, the Executive's employment with the Company shall be "at will" and such Executive's employment may be terminated by the Company at any time upon or after such expiration with or without cause, and that upon such termination the Executive shall have no rights under this Agreement including, without limitation, any right to any severance or other termination payments. 2. COMPENSATION. During the Term of the Executive's employment with the Company hereunder, the Company will compensate the Executive as follows: (A) SALARY. The Company will pay to the Executive a base salary, payable in accordance with the payroll practices of the Company, at the rate of $160,000 per annum. The Executive's base salary shall be subject to annual review by the Company and Parent. (B) PERFORMANCE BONUSES. The Executive will be eligible to receive an annual cash bonus at an annualized rate of up to 40% of his base salary, based on the achievement of reasonable individual and Company performance targets to be established by the Company and Parent. (C) STAY BONUS. If the Executive is an active employee of the Company on the one-year anniversary (the "Anniversary Date") of the Effective Date, the Executive will be paid a bonus equal to $160,000. (D) BENEFITS. The Company will promptly reimburse all out-of-pocket expenses reasonably incurred by the Executive in the course of performing his employment duties and responsibilities hereunder, subject to receipt of appropriate documentation. The Company will also provide consistent with his position, Company-paid health and life insurance, and with such other fringe benefits as it from time to time may make generally available to its other senior executives at the Executive's level. 3. TERMINATION. (A) EVENTS CAUSING TERMINATION. The Executive's employment hereunder will terminate upon the occurrence of any of the following events: (1) The Executive's death, or a determination of his legal incapacity by a court of competent jurisdiction; (2) The termination of the Executive's employment hereunder by the Company, by written notice to the Executive, upon the Executive's inability due -2- to illness or injury to perform the essential functions of his position with or without reasonable accommodation; (3) The termination of the Executive's employment hereunder by the Company, for Cause, by written notice to the Executive; (4) The termination of the Executive's employment hereunder by the Company, without Cause, by written notice to the Executive; (5) The termination of the Executive's employment hereunder by the Executive, for Good Reason, by thirty (30) days prior written notice to the Company; or (6) The expiration of the Term of this Agreement under Section 1(D) hereof. (B) "CAUSE" AND "GOOD REASON" DEFINED. For purposes of this Agreement: "Cause" means: (a) the Executive's conviction of any crime (whether or not involving the Company) (other than unintentional motor vehicle felonies); (b) any act of theft, fraud or embezzlement by the Executive in connection with his work with the Company; or (c) the Executive's continuing, repeated and willful failure or refusal to perform, or continuing, repeated and gross negligence in the performance of, his material duties and services to the Company (other than due to his incapacity due to illness or injury), provided that such failure or refusal or gross negligence continues uncorrected for a period of 30 days after the Executive shall have received written notice from the Company setting forth with specificity the nature of such failure, refusal, or gross negligence; (d) the breach of this Agreement by the Executive; or (e) the willful violation of Federal and/or state securities laws. "GOOD REASON" means the occurrence of one or more of the following occurring without the specific written consent of the Executive: (i) a material reduction of duties of the Executive, excluding any such reduction in duties reasonably occurring as a result of the transactions contemplated by the Merger Agreement; (ii) a material demotion, or a reduction in base salary of the Executive; (iii) any requirement that the Executive's principal place of work be relocated outside of the Commonwealth of Massachusetts or more than twenty-five (25) miles from its location as of the date of this Agreement; (iv) the Company's breach of any term of this Agreement which is not fully remedied within fifteen (15) calendar days after receipt by the Company of a written notice from the Executive of such breach. (C) ADJUSTMENTS UPON TERMINATION. Notwithstanding any other provision of this Agreement: (1) If the Executive's employment with the Company terminates during the Term pursuant Section 3(A)(4) (by the Company, without Cause) or Section 3(A)(5) (by the Executive, for Good Reason), then, for a twelve (12) month period immediately following the date of such termination, the Company will continue to pay the Executive a base salary at a rate equal to that at which he was being paid at the time of termination, and (subject to Section 3(D) below), will likewise continue to provide the Executive with the benefits that he was receiving at the time of termination (or, if the Company is unable to do so because -3- such benefits may only be provided to current employees, subject to the provisions of Section 3(D) it will provide the Executive with the cash value thereof). In addition to the payments and benefits specified above, the Company will pay the Executive on the date of termination a lump sum payment for all accrued unused vacation time. It is agreed and understood that the Company's duty to make the payments and provide the benefits described in this Section 3(C)(1) shall be conditioned upon the Executive's execution of a satisfactory general release in favor of the Company and the Executive's compliance with Section 5 hereof. (2) If the Executive's employment with the Company terminates during the Term other than pursuant to Section 3(A)(4) (by the Company, without Cause) or Section 3(A)(5) (by the Executive, with Good Reason), then the rights of the Executive to receive future compensation pursuant to Section 2 and Section 3(C)(1) hereof, and all other rights of the Executive hereunder, will cease as of the date of such termination except as may be required by law. As of the date of such termination, the Executive shall receive a lump sum payment for all accrued unpaid wages and accrued unused vacation time. (D) NO DUTY TO MITIGATE; TERMINATION OF BENEFITS. The Executive shall not be required to mitigate the amount of any compensation payable to him pursuant to Section 3(C)(1) hereof, whether by seeking other employment or otherwise. If, during the period during which he is receiving such compensation, the Executive obtains new full-time employment providing him with benefits comparable to those he is entitled to receive from the Company hereunder, then, when the Executive begins receiving such benefits from his new employer, the Executive will no longer be entitled to receive such benefits from the Company but will continue to be entitled to receive payment of his base salary (and other non-duplicative benefits) as provided for herein. 4. CHANGE OF CONTROL Upon the date (the "Effective Date") that is the earlier to occur of (x) the date that Purchaser pays for the Shares pursuant to the Offer and (y) the date of the Effective Time, the Executive (if such Executive is still employed by the Company immediately prior to such date) will be paid a bonus in an amount equal to the amount that would be payable to the Executive under Section 4(A) of the Original Employment Agreement upon the consummation of the Merger as if such Section 4(A) were in effect as of the Effective Time. 5. CERTAIN COVENANTS OF THE EXECUTIVE. The Executive acknowledges that (i) the Company, Parent and Parent's affiliates (collectively, "Thomson") are engaged and in the future will be engaged in the businesses of developing, operating, offering for sale and selling news or other current information or software-based solutions pertaining thereto to corporations and other businesses, government agencies, universities and other academic institutions and professional services providers (e.g. law, accounting and consulting firms) (the foregoing, together with any other businesses or operations over which Executive has substantial responsibility from the date hereof to the date of termination of the Executive's employment with the Company (or an affiliate thereof), being -4- hereinafter referred to as the "Restricted Activity"); (ii) his services to the Company and Thomson have been and will be special and unique; (iii) his work for the Company and Thomson will give him access to trade secrets of and confidential information concerning the Company, Thomson and their affiliated companies; (iv) the Restricted Activity is national and international in scope; (v) the Company would not have entered into this Agreement but for the agreements and covenants contained in this Section 5; (vi) he has the means to support himself and his dependents other than by engaging in the Restricted Activity and the provisions of this Section 5 will not impair such ability; and (vii) the agreements and covenants contained in this Section 5 are essential to protect the business and goodwill of the Company, Thomson and their affiliates. In order to induce the Company to enter into this Agreement, and in consideration for the benefits received by the Executive pursuant to this Agreement, and other good and valuable consideration the receipt of which is hereby acknowledged, the Executive covenants and agrees as follows: (A) NON-COMPETE. During the Restricted Period (as hereinafter defined), the Executive shall not in the United States of America, or in any foreign country, directly or indirectly, (i) engage in the Restricted Activity for the benefit of any person or entity other than the Company, Thomson and their affiliated companies; (ii) be an employee or consultant of, or provide services to, Factiva or Lexus/Nexis or any of their respective direct or indirect subsidiaries; (iii) have an interest in any person engaged in the Restricted Activity in any capacity, including, without limitation, as a partner, shareholder, officer, director, principal, agent, employee, trustee or consultant or any other relationship or capacity; provided, however, the Executive may own, directly or indirectly, solely as an investment, securities of any person which are publicly traded if the Executive (a) is not a controlling person of, or a member of a group which controls, such person, and (b) does not, directly or indirectly, own 1% or more of any class of securities of such person; or (iv) interfere with business relationships (whether formed heretofore or hereafter) between the Company or any of its affiliates and customers or suppliers of the Company or any of its affiliates. The term "Restricted Period" shall mean the period ending on the date that is (x) with respect to clause (ii) of this Section 5(A), eighteen (18) months following the end of the Executive's employment by the Company (or any affiliate of the Company) whether or not pursuant to this Agreement and (y) with respect to clauses (i), (iii) and (iv) of this Section 5(A), twelve (12) months following the end of the Executive's employment by the Company (or any affiliates of the Company) whether or not pursuant to this Agreement. (B) NON-DISCLOSURE. The Executive shall, during the Term of this Agreement and at all times thereafter, treat as confidential and, except as required in the performance of his duties and responsibilities under this Agreement, not disclose, publish or otherwise make available to the public or to any individual, firm or corporation any confidential material (as hereinafter defined). The Executive agrees that all confidential material, together with all notes and records of the Executive relating thereto, and all copies or facsimiles thereof in the possession of the Executive, are the exclusive property of the Company or Thomson, as the case may be, and the Executive agrees to return such material to the Company promptly upon the termination of the Executive's employment with the Company. For the purposes hereof, the term "confidential material" shall mean all information acquired by the Executive in the course of the Executive's employment with the Company in any way concerning the products, projects, activities, business or affairs of the Company or Thomson or the customers, suppliers, licensors, licensees or partners of the Company or Thomson, including, without limitation, all information concerning trade secrets and the products or projects of the Company or Thomson and/or any -5- improvements therein, all sales and financial information concerning the Company or Thomson, all customer and supplier lists, all information concerning projects in research and development or marketing plans for any such products or projects, all information concerning technical data, designs, patterns, formulae, computer programs, source code, object code, algorithms and subroutines of the Company or Thomson, and all information in any way concerning the products, projects, activities, business or affairs of customers of the Company or Thomson which is furnished to the Executive by the Company or Thomson or any of their respective employees (current or former), agents or customers, as such; provided, however, that the term "confidential material" shall not include information which (a) becomes generally available to the public other than as a result of a disclosure by the Executive, (b) was available to the Executive on a non-confidential basis prior to his employment with the Company or (c) becomes available to the Executive on a non-confidential basis from a source other than the Company or Thomson or any of their agents, franchisees, creditors, suppliers, lessors, lessees, licensors, licensees, partners or customers provided that such source is not bound by a confidentiality agreement with the Company or Thomson or any of such agents or customers. (C) NON-SOLICITATION. During the Restricted Period, the Executive shall not (i) hire or attempt to hire, or (ii) solicit or entice or attempt to solicit or entice away, any person who is (at the applicable time or was within the six month period prior to any such hire, solicitation or enticement) an officer, employee or consultant of the Company or Thomson Legal & Regulatory (including without limitation Dialog) (in the case of clause (i) above) or the Company or Thomson (in the case of clause (ii) above), as applicable, either for his own account or for any individual, firm or corporation, whether or not such person would commit any breach of his contract of employment by reason of leaving the service of the Company, Thomson or Thomson Legal & Regulatory (including without limitation Dialog), as applicable. (D) DEVELOPMENTS. The Executive agrees that all discoveries, inventions, processes, methods and improvements, conceived, developed or otherwise made by the Executive at any time, alone or with others in any way relating to the Company's present or future business or products, whether patentable or subject to copyright protection and whether or not reduced to practice, during the period of the Executive's employment with the Company ("Developments"), shall be the sole property of the Company. The Executive agrees to, and hereby does, assign to the Company all of the Executive's right, title and interest throughout the world in and to all Developments. The Executive agrees that such Developments shall constitute works made for hire under the copyright laws of the United States and hereby assigns to the Company all copyrights, patents and other proprietary rights the Executive may have in such Developments. The Executive shall make and maintain adequate and current written records of all Developments, and the Executive shall disclose all developments promptly, fully and in writing to the Company promptly after development of the same, and at any time upon request, provided, however, that developments excluded under the following paragraph shall be received by the Company in confidence. The Executive has informed the Company in writing of any continuing obligations to any previous employers which require him not to disclose to the Company any information, and the Executive has also informed the Company in writing of any and all confidential information or Developments which the Executive claims as his own and intends to exclude from the restrictions set forth in the previous paragraph because it was developed by the Executive prior to the commencement of his employment by the Company. There shall also be -6- excluded from the restrictions set forth in the previous paragraph any Development made by the Executive (a) which is developed by the Executive without the use of the Company's property or facilities, (b) which does not make any use of confidential information, (c) which is developed by the Executive entirely on his own time, and (d) which does not relate to the Company's business or to the Company's ongoing or planned research and development efforts. At any time at the request of the Company (and at the Company's expense), the Executive shall execute all documents and perform all lawful acts the Company considers necessary or advisable to secure its rights hereunder and to carry out the intent of this Section 5(D). At any time upon the request of the Company, the Executive shall return promptly to the Company all the Company's property, including all copies of all confidential information or Developments. (E) In the event of a breach or threatened breach by the Executive of any of the provisions of Section 5 of this Agreement, the Executive hereby consents and agrees that the Company shall be entitled to an injunction or similar equitable relief from any court of competent jurisdiction restraining the Executive from committing or continuing any such breach or threatened breach or granting specific performance of any act required to be performed by the Executive under any of such provisions, without the necessity of showing any actual damage or that money damages would not afford an adequate remedy and without the necessity of posting any bond or other security. Nothing herein shall be construed as prohibiting the Company from pursuing any other remedies at law or in equity which it may have with respect to any such breach or threatened breach. 6. MISCELLANEOUS. (A) BENEFITS OF AGREEMENT; NO ASSIGNMENTS; NO THIRD-PARTY BENEFICIARIES. (1) This Agreement will bind and inure to the benefit of the parties hereto and their respective heirs, successors, and permitted assigns. (2) Neither party will assign any rights or delegate any obligations hereunder without the consent of the other party (except that the Company may assign its rights and delegate its obligations hereunder to any affiliate of the Company or to any successor to its business, whether by merger or consolidation, sale of stock or of all or substantially all of its assets, or otherwise), and any attempt to do so will be void. (3) Nothing in this Agreement is intended to or will confer any rights or remedies on any person or entity other than the parties hereto, their respective heirs, successors, and permitted assigns. (B) NOTICES. All notices, requests, payments, instructions, or other documents to be given hereunder will be in writing or by written telecommunication, and will be deemed to have been duly given if (i) delivered personally (effective upon delivery), (ii) mailed by registered or certified mail, return receipt requested, postage prepaid (effective five business days after dispatch), (iii) sent by a reputable, established courier service that guarantees next business day delivery (effective the next business day), or (iv) sent by telecopier followed within 24 hours by confirmation by one of the foregoing methods (effective upon receipt of the telecopy in complete, readable form), addressed to the recipient party at its address set forth in the first paragraph hereof (or to such other address as the recipient party may have furnished to the -7- sending party for the purpose pursuant to this section) and, with respect to any notice given on or prior to the Effective Date, with a copy sent to the Purchaser at its address set forth in the Merger Agreement. (C) COUNTERPARTS. This Agreement may be executed by the parties in separate counterparts, each of which when so executed and delivered will be an original, but all of which together will constitute one and the same agreement. In pleading or proving this Agreement, it will not be necessary to produce or account for more than one such counterpart. (D) CAPTIONS. The captions of sections or subsections of this Agreement are for reference only and will not affect the interpretation or construction of this Agreement. (E) CONSTRUCTION. The language used in this Agreement is the language chosen by the parties to express their mutual intent, and no rule of strict construction will be applied against either party. (F) WAIVERS; AMENDMENTS. No waiver of any breach or default hereunder will be valid unless in writing signed by the waiving party. No failure or other delay by any party exercising any right, power, or privilege hereunder will be or operate as a waiver thereof, nor will any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power, or privilege. No amendment or modification of this Agreement will be valid or binding unless in a writing signed by both the Executive and the Company and, with respect to any amendment or modification of this Agreement prior to the Effective Date, by Purchaser. (G) ENTIRE AGREEMENT. This Agreement contains the entire understanding and agreement between the parties, and supersedes any prior understandings or agreements between them, with respect to the subject matter hereof (including, without limitation, the Original Employment Agreement). The parties acknowledge and agree that any and all agreements between the parties relating to stock options granted by the Company (including its predecessors, successors and affiliates) to the Executive, are superseded by and subject to Section 3.07 of the Merger Agreement. (H) GOVERNING LAW. This Agreement will be governed by and interpreted and construed in accordance with the internal laws of the Commonwealth of Massachusetts, without reference to principles of conflicts or choice of law. * * * -8- IN WITNESS WHEREOF, each of the Company and the Executive has executed and delivered this Agreement as an agreement under seal as of the date first above written. EXECUTIVE: /s/ David Scott - ----------------------------------- COMPANY: /s/ Clifford Pollan - ----------------------------------- -9- EX-99.E10 12 a2057464zex-99_e10.txt EXHIBIT 99.E.10 AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT This Amended and Restated Executive Employment Agreement (this "Agreement") dated as of August 6, 2001 is by and between NEWSEDGE CORPORATION (the "Company"), a Delaware corporation having its principal executive offices at 80 Blanchard Road, Burlington, Massachusetts, and Alton Zink (the "Executive"). WHEREAS, THE THOMSON CORPORATION ("Parent") proposes to acquire the Company pursuant to that certain Agreement and Plan of Merger dated as of August 6, 2001 ("Merger Agreement") by and among the Company, Parent and INFOBLADE ACQUISITION CORPORATION ("Purchaser"); and WHEREAS, the Executive currently serves as Vice President, Human Resources of the Company pursuant to an Executive Employment Agreement dated as of January 18, 2001 (the "Original Employment Agreement") between the Company and the Executive; and WHEREAS, the Company and the Executive desire to amend and restate the Original Employment Agreement in its entirety as of the date hereof and to provide for the employment of Executive by the Company from and after the Effective Date (as hereinafter defined) in accordance with the terms hereof. NOW, THEREFORE, in consideration of the terms, conditions, and mutual covenants hereinafter contained, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto do hereby agree to amend and restate the Original Employment Agreement in its entirety as follows: 1. EFFECTIVENESS; EMPLOYMENT OF EXECUTIVE; TERM. (A) EFFECTIVENESS. The terms and conditions of this Agreement shall become effective automatically, without further act or deed by the Executive or the Company, on the date hereof and the Original Employment Agreement is hereby superseded in its entirety and of no further force and effect, provided, however, that notwithstanding the foregoing, in the event that the Merger Agreement is terminated prior to the Effective Time (as defined in the Merger Agreement), this Agreement shall automatically terminate and have no further force or effect and the Original Employment Agreement shall be automatically reinstated upon such termination of the Merger Agreement. (B) EMPLOYMENT. Subject to the terms and conditions of this Agreement, during the Term (as hereinafter defined), the Company agrees to employ the Executive, and the Executive agrees to serve, as the Company's Vice President, Human Resources, reporting to the Company's President and Chief Executive Officer (the Executive's "Supervisor") and having such powers and duties consistent with his position as may reasonably be assigned to him from time to time. (C) COMMITMENT. The Executive represents that he is not currently party to or bound by any commitments that might interfere with or impair his performance of such duties and responsibilities or that are inconsistent with his obligations hereunder. The Executive will devote such time and attention to his duties and responsibilities hereunder as reasonably are required, and will not undertake any commitments that would interfere with or impair his performance of such duties and responsibilities. TERM. The term of the Executive's employment under this Agreement shall commence on the Effective Date (as defined in Section 4 below) and shall terminate on the one-year anniversary date of the Effective Date, unless sooner terminated in accordance with Section 3 of this Agreement (the "Term"). Upon the expiration of the Term, the Executive's employment with the Company shall be "at will" and such Executive's employment may be terminated by the Company at any time upon or after such expiration with or without cause, and that upon such termination the Executive shall have no rights under this Agreement including, without limitation, any right to any severance or other termination payments. 2. COMPENSATION. During the Term of the Executive's employment with the Company hereunder, the Company will compensate the Executive as follows: (A) SALARY. The Company will pay to the Executive a base salary, payable in accordance with the payroll practices of the Company, at the rate of $150,000 per annum. The Executive's base salary shall be subject to annual review by the Company and Parent. (B) PERFORMANCE BONUSES. The Executive will be eligible to receive an annual cash bonus at an annualized rate of up to 45% of his base salary, based on the achievement of reasonable individual and Company performance targets to be established by the Company and Parent. (C) STAY BONUS. If the Executive is an active employee of the Company on the one-year anniversary (the "Anniversary Date") of the Effective Date, the Executive will be paid a bonus equal to $150,000. (D) BENEFITS. The Company will promptly reimburse all out-of-pocket expenses reasonably incurred by the Executive in the course of performing his employment duties and responsibilities hereunder, subject to receipt of appropriate documentation. The Company will also provide consistent with his position, Company-paid health and life insurance, and with such other fringe benefits as it from time to time may make generally available to its other senior executives at the Executive's level. 3. TERMINATION. (A) EVENTS CAUSING TERMINATION. The Executive's employment hereunder will terminate upon the occurrence of any of the following events: (1) The Executive's death, or a determination of his legal incapacity by a court of competent jurisdiction; (2) The termination of the Executive's employment hereunder by the Company, by written notice to the Executive, upon the Executive's inability due -2- to illness or injury to perform the essential functions of his position with or without reasonable accommodation; (3) The termination of the Executive's employment hereunder by the Company, for Cause, by written notice to the Executive; (4) The termination of the Executive's employment hereunder by the Company, without Cause, by written notice to the Executive; (5) The termination of the Executive's employment hereunder by the Executive, for Good Reason, by thirty (30) days prior written notice to the Company; or (6) The expiration of the Term of this Agreement under Section 1(D) hereof. (B) "CAUSE" AND "GOOD REASON" DEFINED. For purposes of this Agreement: "Cause" means: (a) the Executive's conviction of any crime (whether or not involving the Company) (other than unintentional motor vehicle felonies); (b) any act of theft, fraud or embezzlement by the Executive in connection with his work with the Company; or (c) the Executive's continuing, repeated and willful failure or refusal to perform, or continuing, repeated and gross negligence in the performance of, his material duties and services to the Company (other than due to his incapacity due to illness or injury), provided that such failure or refusal or gross negligence continues uncorrected for a period of 30 days after the Executive shall have received written notice from the Company setting forth with specificity the nature of such failure, refusal, or gross negligence; (d) the breach of this Agreement by the Executive; or (e) the willful violation of Federal and/or state securities laws. "GOOD REASON" means the occurrence of one or more of the following occurring without the specific written consent of the Executive: (i) a material reduction of duties of the Executive, excluding any such reduction in duties reasonably occurring as a result of the transactions contemplated by the Merger Agreement; (ii) a material demotion, or a reduction in base salary of the Executive; (iii) any requirement that the Executive's principal place of work be relocated outside of the Commonwealth of Massachusetts or more than twenty-five (25) miles from its location as of the date of this Agreement; (iv) the Company's breach of any term of this Agreement which is not fully remedied within fifteen (15) calendar days after receipt by the Company of a written notice from the Executive of such breach. (C) ADJUSTMENTS UPON TERMINATION. Notwithstanding any other provision of this Agreement: (1) If the Executive's employment with the Company terminates during the Term pursuant Section 3(A)(4) (by the Company, without Cause) or Section 3(A)(5) (by the Executive, for Good Reason), then, for a twelve (12) month period immediately following the date of such termination, the Company will continue to pay the Executive a base salary at a rate equal to that at which he was being paid at the time of termination, and (subject to Section 3(D) below), will likewise continue to provide the Executive with the benefits that he was receiving at the time of termination (or, if the Company is unable to do so because -3- such benefits may only be provided to current employees, subject to the provisions of Section 3(D) it will provide the Executive with the cash value thereof). In addition to the payments and benefits specified above, the Company will pay the Executive on the date of termination a lump sum payment for all accrued unused vacation time. It is agreed and understood that the Company's duty to make the payments and provide the benefits described in this Section 3(C)(1) shall be conditioned upon the Executive's execution of a satisfactory general release in favor of the Company and the Executive's compliance with Section 5 hereof. (2) If the Executive's employment with the Company terminates during the Term other than pursuant to Section 3(A)(4) (by the Company, without Cause) or Section 3(A)(5) (by the Executive, with Good Reason), then the rights of the Executive to receive future compensation pursuant to Section 2 and Section 3(C)(1) hereof, and all other rights of the Executive hereunder, will cease as of the date of such termination except as may be required by law. As of the date of such termination, the Executive shall receive a lump sum payment for all accrued unpaid wages and accrued unused vacation time. (D) NO DUTY TO MITIGATE; TERMINATION OF BENEFITS. The Executive shall not be required to mitigate the amount of any compensation payable to him pursuant to Section 3(C)(1) hereof, whether by seeking other employment or otherwise. If, during the period during which he is receiving such compensation, the Executive obtains new full-time employment providing him with benefits comparable to those he is entitled to receive from the Company hereunder, then, when the Executive begins receiving such benefits from his new employer, the Executive will no longer be entitled to receive such benefits from the Company but will continue to be entitled to receive payment of his base salary (and other non-duplicative benefits) as provided for herein. 4. CHANGE OF CONTROL Upon the date (the "Effective Date") that is the earlier to occur of (x) the date that Purchaser pays for the Shares pursuant to the Offer and (y) the date of the Effective Time, the Executive (if such Executive is still employed by the Company immediately prior to such date) will be paid a bonus in an amount equal to the amount that would be payable to the Executive under Section 4(A) of the Original Employment Agreement upon the consummation of the Merger as if such Section 4(A) were in effect as of the Effective Time. 5. CERTAIN COVENANTS OF THE EXECUTIVE. The Executive acknowledges that (i) the Company, Parent and Parent's affiliates (collectively, "Thomson") are engaged and in the future will be engaged in the businesses of developing, operating, offering for sale and selling news or other current information or software-based solutions pertaining thereto to corporations and other businesses, government agencies, universities and other academic institutions and professional services providers (e.g. law, accounting and consulting firms) (the foregoing, together with any other businesses or operations over which Executive has substantial responsibility from the date hereof to the date of termination of the Executive's employment with the Company (or an affiliate thereof), being -4- hereinafter referred to as the "Restricted Activity"); (ii) his services to the Company and Thomson have been and will be special and unique; (iii) his work for the Company and Thomson will give him access to trade secrets of and confidential information concerning the Company, Thomson and their affiliated companies; (iv) the Restricted Activity is national and international in scope; (v) the Company would not have entered into this Agreement but for the agreements and covenants contained in this Section 5; (vi) he has the means to support himself and his dependents other than by engaging in the Restricted Activity and the provisions of this Section 5 will not impair such ability; and (vii) the agreements and covenants contained in this Section 5 are essential to protect the business and goodwill of the Company, Thomson and their affiliates. In order to induce the Company to enter into this Agreement, and in consideration for the benefits received by the Executive pursuant to this Agreement, and other good and valuable consideration the receipt of which is hereby acknowledged, the Executive covenants and agrees as follows: (A) NON-COMPETE. During the Restricted Period (as hereinafter defined), the Executive shall not in the United States of America, or in any foreign country, directly or indirectly, (i) engage in the Restricted Activity for the benefit of any person or entity other than the Company, Thomson and their affiliated companies; (ii) be an employee or consultant of, or provide services to, Factiva or Lexus/Nexis or any of their respective direct or indirect subsidiaries; (iii) have an interest in any person engaged in the Restricted Activity in any capacity, including, without limitation, as a partner, shareholder, officer, director, principal, agent, employee, trustee or consultant or any other relationship or capacity; provided, however, the Executive may own, directly or indirectly, solely as an investment, securities of any person which are publicly traded if the Executive (a) is not a controlling person of, or a member of a group which controls, such person, and (b) does not, directly or indirectly, own 1% or more of any class of securities of such person; or (iv) interfere with business relationships (whether formed heretofore or hereafter) between the Company or any of its affiliates and customers or suppliers of the Company or any of its affiliates. The term "Restricted Period" shall mean the period ending on the date that is (x) with respect to clause (ii) of this Section 5(A), eighteen (18) months following the end of the Executive's employment by the Company (or any affiliate of the Company) whether or not pursuant to this Agreement and (y) with respect to clauses (i), (iii) and (iv) of this Section 5(A), twelve (12) months following the end of the Executive's employment by the Company (or any affiliates of the Company) whether or not pursuant to this Agreement. (B) NON-DISCLOSURE. The Executive shall, during the Term of this Agreement and at all times thereafter, treat as confidential and, except as required in the performance of his duties and responsibilities under this Agreement, not disclose, publish or otherwise make available to the public or to any individual, firm or corporation any confidential material (as hereinafter defined). The Executive agrees that all confidential material, together with all notes and records of the Executive relating thereto, and all copies or facsimiles thereof in the possession of the Executive, are the exclusive property of the Company or Thomson, as the case may be, and the Executive agrees to return such material to the Company promptly upon the termination of the Executive's employment with the Company. For the purposes hereof, the term "confidential material" shall mean all information acquired by the Executive in the course of the Executive's employment with the Company in any way concerning the products, projects, activities, business or affairs of the Company or Thomson or the customers, suppliers, licensors, licensees or partners of the Company or Thomson, including, without limitation, all information concerning trade secrets and the products or projects of the Company or Thomson and/or any -5- improvements therein, all sales and financial information concerning the Company or Thomson, all customer and supplier lists, all information concerning projects in research and development or marketing plans for any such products or projects, all information concerning technical data, designs, patterns, formulae, computer programs, source code, object code, algorithms and subroutines of the Company or Thomson, and all information in any way concerning the products, projects, activities, business or affairs of customers of the Company or Thomson which is furnished to the Executive by the Company or Thomson or any of their respective employees (current or former), agents or customers, as such; provided, however, that the term "confidential material" shall not include information which (a) becomes generally available to the public other than as a result of a disclosure by the Executive, (b) was available to the Executive on a non-confidential basis prior to his employment with the Company or (c) becomes available to the Executive on a non-confidential basis from a source other than the Company or Thomson or any of their agents, franchisees, creditors, suppliers, lessors, lessees, licensors, licensees, partners or customers provided that such source is not bound by a confidentiality agreement with the Company or Thomson or any of such agents or customers. (C) NON-SOLICITATION. During the Restricted Period, the Executive shall not (i) hire or attempt to hire, or (ii) solicit or entice or attempt to solicit or entice away, any person who is (at the applicable time or was within the six month period prior to any such hire, solicitation or enticement) an officer, employee or consultant of the Company or Thomson Legal & Regulatory (including without limitation Dialog) (in the case of clause (i) above) or the Company or Thomson (in the case of clause (ii) above), as applicable, either for his own account or for any individual, firm or corporation, whether or not such person would commit any breach of his contract of employment by reason of leaving the service of the Company, Thomson or Thomson Legal & Regulatory (including without limitation Dialog), as applicable. (D) DEVELOPMENTS. The Executive agrees that all discoveries, inventions, processes, methods and improvements, conceived, developed or otherwise made by the Executive at any time, alone or with others in any way relating to the Company's present or future business or products, whether patentable or subject to copyright protection and whether or not reduced to practice, during the period of the Executive's employment with the Company ("Developments"), shall be the sole property of the Company. The Executive agrees to, and hereby does, assign to the Company all of the Executive's right, title and interest throughout the world in and to all Developments. The Executive agrees that such Developments shall constitute works made for hire under the copyright laws of the United States and hereby assigns to the Company all copyrights, patents and other proprietary rights the Executive may have in such Developments. The Executive shall make and maintain adequate and current written records of all Developments, and the Executive shall disclose all developments promptly, fully and in writing to the Company promptly after development of the same, and at any time upon request, provided, however, that developments excluded under the following paragraph shall be received by the Company in confidence. The Executive has informed the Company in writing of any continuing obligations to any previous employers which require him not to disclose to the Company any information, and the Executive has also informed the Company in writing of any and all confidential information or Developments which the Executive claims as his own and intends to exclude from the restrictions set forth in the previous paragraph because it was developed by the Executive prior to the commencement of his employment by the Company. There shall also be -6- excluded from the restrictions set forth in the previous paragraph any Development made by the Executive (a) which is developed by the Executive without the use of the Company's property or facilities, (b) which does not make any use of confidential information, (c) which is developed by the Executive entirely on his own time, and (d) which does not relate to the Company's business or to the Company's ongoing or planned research and development efforts. At any time at the request of the Company (and at the Company's expense), the Executive shall execute all documents and perform all lawful acts the Company considers necessary or advisable to secure its rights hereunder and to carry out the intent of this Section 5(D). At any time upon the request of the Company, the Executive shall return promptly to the Company all the Company's property, including all copies of all confidential information or Developments. (E) In the event of a breach or threatened breach by the Executive of any of the provisions of Section 5 of this Agreement, the Executive hereby consents and agrees that the Company shall be entitled to an injunction or similar equitable relief from any court of competent jurisdiction restraining the Executive from committing or continuing any such breach or threatened breach or granting specific performance of any act required to be performed by the Executive under any of such provisions, without the necessity of showing any actual damage or that money damages would not afford an adequate remedy and without the necessity of posting any bond or other security. Nothing herein shall be construed as prohibiting the Company from pursuing any other remedies at law or in equity which it may have with respect to any such breach or threatened breach. 6. MISCELLANEOUS. (A) BENEFITS OF AGREEMENT; NO ASSIGNMENTS; NO THIRD-PARTY BENEFICIARIES. (1) This Agreement will bind and inure to the benefit of the parties hereto and their respective heirs, successors, and permitted assigns. (2) Neither party will assign any rights or delegate any obligations hereunder without the consent of the other party (except that the Company may assign its rights and delegate its obligations hereunder to any affiliate of the Company or to any successor to its business, whether by merger or consolidation, sale of stock or of all or substantially all of its assets, or otherwise), and any attempt to do so will be void. (3) Nothing in this Agreement is intended to or will confer any rights or remedies on any person or entity other than the parties hereto, their respective heirs, successors, and permitted assigns. (B) NOTICES. All notices, requests, payments, instructions, or other documents to be given hereunder will be in writing or by written telecommunication, and will be deemed to have been duly given if (i) delivered personally (effective upon delivery), (ii) mailed by registered or certified mail, return receipt requested, postage prepaid (effective five business days after dispatch), (iii) sent by a reputable, established courier service that guarantees next business day delivery (effective the next business day), or (iv) sent by telecopier followed within 24 hours by confirmation by one of the foregoing methods (effective upon receipt of the telecopy in complete, readable form), addressed to the recipient party at its address set forth in the first paragraph hereof (or to such other address as the recipient party may have furnished to the -7- sending party for the purpose pursuant to this section) and, with respect to any notice given on or prior to the Effective Date, with a copy sent to the Purchaser at its address set forth in the Merger Agreement. (C) COUNTERPARTS. This Agreement may be executed by the parties in separate counterparts, each of which when so executed and delivered will be an original, but all of which together will constitute one and the same agreement. In pleading or proving this Agreement, it will not be necessary to produce or account for more than one such counterpart. (D) CAPTIONS. The captions of sections or subsections of this Agreement are for reference only and will not affect the interpretation or construction of this Agreement. (E) CONSTRUCTION. The language used in this Agreement is the language chosen by the parties to express their mutual intent, and no rule of strict construction will be applied against either party. (F) WAIVERS; AMENDMENTS. No waiver of any breach or default hereunder will be valid unless in writing signed by the waiving party. No failure or other delay by any party exercising any right, power, or privilege hereunder will be or operate as a waiver thereof, nor will any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power, or privilege. No amendment or modification of this Agreement will be valid or binding unless in a writing signed by both the Executive and the Company and, with respect to any amendment or modification of this Agreement prior to the Effective Date, by Purchaser. (G) ENTIRE AGREEMENT. This Agreement contains the entire understanding and agreement between the parties, and supersedes any prior understandings or agreements between them, with respect to the subject matter hereof (including, without limitation, the Original Employment Agreement). The parties acknowledge and agree that any and all agreements between the parties relating to stock options granted by the Company (including its predecessors, successors and affiliates) to the Executive, are superseded by and subject to Section 3.07 of the Merger Agreement. (H) GOVERNING LAW. This Agreement will be governed by and interpreted and construed in accordance with the internal laws of the Commonwealth of Massachusetts, without reference to principles of conflicts or choice of law. * * * -8- IN WITNESS WHEREOF, each of the Company and the Executive has executed and delivered this Agreement as an agreement under seal as of the date first above written. EXECUTIVE: /s/ Alton Zink - ----------------------------------- COMPANY: /s/ Clifford Pollan - ----------------------------------- -9- EX-99.E11 13 a2057464zex-99_e11.txt EXHIBIT 99.E.11 AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT This Amended and Restated Executive Employment Agreement (this "Agreement") dated as of August 6, 2001 is by and between NEWSEDGE CORPORATION (the "Company"), a Delaware corporation having its principal executive offices at 80 Blanchard Road, Burlington, Massachusetts, and Lee Phillips (the "Executive"). WHEREAS, THE THOMSON CORPORATION ("Parent") proposes to acquire the Company pursuant to that certain Agreement and Plan of Merger dated as of August 6, 2001 ("Merger Agreement") by and among the Company, Parent and INFOBLADE ACQUISITION CORPORATION ("Purchaser"); and WHEREAS, the Executive currently serves as Vice President, Product Marketing of the Company pursuant to an Amended and Restated Executive Employment Agreement dated as of April 1, 2001 (the "Original Employment Agreement") between the Company and the Executive; and WHEREAS, the Company and the Executive desire to amend and restate the Original Employment Agreement in its entirety as of the date hereof and to provide for the employment of Executive by the Company from and after the Effective Date (as hereinafter defined) in accordance with the terms hereof. NOW, THEREFORE, in consideration of the terms, conditions, and mutual covenants hereinafter contained, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto do hereby agree to amend and restate the Original Employment Agreement in its entirety as follows: 1. EFFECTIVENESS; EMPLOYMENT OF EXECUTIVE; TERM. (A) EFFECTIVENESS. The terms and conditions of this Agreement shall become effective automatically, without further act or deed by the Executive or the Company, on the date hereof and the Original Employment Agreement is hereby superseded in its entirety and of no further force and effect, provided, however, that notwithstanding the foregoing, in the event that the Merger Agreement is terminated prior to the Effective Time (as defined in the Merger Agreement), this Agreement shall automatically terminate and have no further force or effect and the Original Employment Agreement shall be automatically reinstated upon such termination of the Merger Agreement. (B) EMPLOYMENT. Subject to the terms and conditions of this Agreement, during the Term (as hereinafter defined), the Company agrees to employ the Executive, and the Executive agrees to serve, as the Company's Vice President, Product Marketing, reporting to the Company's President and Chief Executive Officer (the Executive's "Supervisor") and having such powers and duties consistent with his position as may reasonably be assigned to him from time to time. (C) COMMITMENT. The Executive represents that he is not currently party to or bound by any commitments that might interfere with or impair his performance of such duties and responsibilities or that are inconsistent with his obligations hereunder. The Executive will devote such time and attention to his duties and responsibilities hereunder as reasonably are required, and will not undertake any commitments that would interfere with or impair his performance of such duties and responsibilities. TERM. The term of the Executive's employment under this Agreement shall commence on the Effective Date (as defined in Section 4 below) and shall terminate on the one-year anniversary date of the Effective Date, unless sooner terminated in accordance with Section 3 of this Agreement (the "Term"). Upon the expiration of the Term, the Executive's employment with the Company shall be "at will" and such Executive's employment may be terminated by the Company at any time upon or after such expiration with or without cause, and that upon such termination the Executive shall have no rights under this Agreement including, without limitation, any right to any severance or other termination payments. 2. COMPENSATION. During the Term of the Executive's employment with the Company hereunder, the Company will compensate the Executive as follows: (A) SALARY. The Company will pay to the Executive a base salary, payable in accordance with the payroll practices of the Company, at the rate of $150,000 per annum. The Executive's base salary shall be subject to annual review by the Company and Parent. (B) PERFORMANCE BONUSES. The Executive will be eligible to receive an annual cash bonus at an annualized rate of up to 40% of his base salary, based on the achievement of reasonable individual and Company performance targets to be established by the Company and Parent. (C) STAY BONUS. If the Executive is an active employee of the Company on the one-year anniversary (the "Anniversary Date") of the Effective Date, the Executive will be paid a bonus equal to $150,000. (D) BENEFITS. The Company will promptly reimburse all out-of-pocket expenses reasonably incurred by the Executive in the course of performing his employment duties and responsibilities hereunder, subject to receipt of appropriate documentation. The Company will also provide consistent with his position, Company-paid health and life insurance, and with such other fringe benefits as it from time to time may make generally available to its other senior executives at the Executive's level. 3. TERMINATION. (A) EVENTS CAUSING TERMINATION. The Executive's employment hereunder will terminate upon the occurrence of any of the following events: (1) The Executive's death, or a determination of his legal incapacity by a court of competent jurisdiction; (2) The termination of the Executive's employment hereunder by the Company, by written notice to the Executive, upon the Executive's inability due -2- to illness or injury to perform the essential functions of his position with or without reasonable accommodation; (3) The termination of the Executive's employment hereunder by the Company, for Cause, by written notice to the Executive; (4) The termination of the Executive's employment hereunder by the Company, without Cause, by written notice to the Executive; (5) The termination of the Executive's employment hereunder by the Executive, for Good Reason, by thirty (30) days prior written notice to the Company; or (6) The expiration of the Term of this Agreement under Section 1(D) hereof. (B) "CAUSE" AND "GOOD REASON" DEFINED. For purposes of this Agreement: "Cause" means: (a) the Executive's conviction of any crime (whether or not involving the Company) (other than unintentional motor vehicle felonies); (b) any act of theft, fraud or embezzlement by the Executive in connection with his work with the Company; or (c) the Executive's continuing, repeated and willful failure or refusal to perform, or continuing, repeated and gross negligence in the performance of, his material duties and services to the Company (other than due to his incapacity due to illness or injury), provided that such failure or refusal or gross negligence continues uncorrected for a period of 30 days after the Executive shall have received written notice from the Company setting forth with specificity the nature of such failure, refusal, or gross negligence; (d) the breach of this Agreement by the Executive; or (e) the willful violation of Federal and/or state securities laws. "GOOD REASON" means the occurrence of one or more of the following occurring without the specific written consent of the Executive: (i) a material reduction of duties of the Executive, excluding any such reduction in duties reasonably occurring as a result of the transactions contemplated by the Merger Agreement; (ii) a material demotion, or a reduction in base salary of the Executive; (iii) any requirement that the Executive's principal place of work be relocated outside of the Commonwealth of Massachusetts or more than twenty-five (25) miles from its location as of the date of this Agreement; (iv) the Company's breach of any term of this Agreement which is not fully remedied within fifteen (15) calendar days after receipt by the Company of a written notice from the Executive of such breach. (C) ADJUSTMENTS UPON TERMINATION. Notwithstanding any other provision of this Agreement: (1) If the Executive's employment with the Company terminates during the Term pursuant Section 3(A)(4) (by the Company, without Cause) or Section 3(A)(5) (by the Executive, for Good Reason), then, for a twelve (12) month period immediately following the date of such termination, the Company will continue to pay the Executive a base salary at a rate equal to that at which he was being paid at the time of termination, and (subject to Section 3(D) below), will likewise continue to provide the Executive with the benefits that he was receiving at the time of termination (or, if the Company is unable to do so because -3- such benefits may only be provided to current employees, subject to the provisions of Section 3(D) it will provide the Executive with the cash value thereof). In addition to the payments and benefits specified above, the Company will pay the Executive on the date of termination a lump sum payment for all accrued unused vacation time. It is agreed and understood that the Company's duty to make the payments and provide the benefits described in this Section 3(C)(1) shall be conditioned upon the Executive's execution of a satisfactory general release in favor of the Company and the Executive's compliance with Section 5 hereof. (2) If the Executive's employment with the Company terminates during the Term other than pursuant to Section 3(A)(4) (by the Company, without Cause) or Section 3(A)(5) (by the Executive, with Good Reason), then the rights of the Executive to receive future compensation pursuant to Section 2 and Section 3(C)(1) hereof, and all other rights of the Executive hereunder, will cease as of the date of such termination except as may be required by law. As of the date of such termination, the Executive shall receive a lump sum payment for all accrued unpaid wages and accrued unused vacation time. (D) NO DUTY TO MITIGATE; TERMINATION OF BENEFITS. The Executive shall not be required to mitigate the amount of any compensation payable to him pursuant to Section 3(C)(1) hereof, whether by seeking other employment or otherwise. If, during the period during which he is receiving such compensation, the Executive obtains new full-time employment providing him with benefits comparable to those he is entitled to receive from the Company hereunder, then, when the Executive begins receiving such benefits from his new employer, the Executive will no longer be entitled to receive such benefits from the Company but will continue to be entitled to receive payment of his base salary (and other non-duplicative benefits) as provided for herein. 4. CHANGE OF CONTROL Upon the date (the "Effective Date") that is the earlier to occur of (x) the date that Purchaser pays for the Shares pursuant to the Offer and (y) the date of the Effective Time, the Executive (if such Executive is still employed by the Company immediately prior to such date) will be paid a bonus in an amount equal to the amount that would be payable to the Executive under Section 4(A) of the Original Employment Agreement upon the consummation of the Merger as if such Section 4(A) were in effect as of the Effective Time. 5. CERTAIN COVENANTS OF THE EXECUTIVE. The Executive acknowledges that (i) the Company, Parent and Parent's affiliates (collectively, "Thomson") are engaged and in the future will be engaged in the businesses of developing, operating, offering for sale and selling news or other current information or software-based solutions pertaining thereto to corporations and other businesses, government agencies, universities and other academic institutions and professional services providers (e.g. law, accounting and consulting firms) (the foregoing, together with any other businesses or operations over which Executive has substantial responsibility from the date hereof to the date of termination of the Executive's employment with the Company (or an affiliate thereof), being -4- hereinafter referred to as the "Restricted Activity"); (ii) his services to the Company and Thomson have been and will be special and unique; (iii) his work for the Company and Thomson will give him access to trade secrets of and confidential information concerning the Company, Thomson and their affiliated companies; (iv) the Restricted Activity is national and international in scope; (v) the Company would not have entered into this Agreement but for the agreements and covenants contained in this Section 5; (vi) he has the means to support himself and his dependents other than by engaging in the Restricted Activity and the provisions of this Section 5 will not impair such ability; and (vii) the agreements and covenants contained in this Section 5 are essential to protect the business and goodwill of the Company, Thomson and their affiliates. In order to induce the Company to enter into this Agreement, and in consideration for the benefits received by the Executive pursuant to this Agreement, and other good and valuable consideration the receipt of which is hereby acknowledged, the Executive covenants and agrees as follows: (A) NON-COMPETE. During the Restricted Period (as hereinafter defined), the Executive shall not in the United States of America, or in any foreign country, directly or indirectly, (i) engage in the Restricted Activity for the benefit of any person or entity other than the Company, Thomson and their affiliated companies; (ii) be an employee or consultant of, or provide services to, Factiva or Lexus/Nexis or any of their respective direct or indirect subsidiaries; (iii) have an interest in any person engaged in the Restricted Activity in any capacity, including, without limitation, as a partner, shareholder, officer, director, principal, agent, employee, trustee or consultant or any other relationship or capacity; provided, however, the Executive may own, directly or indirectly, solely as an investment, securities of any person which are publicly traded if the Executive (a) is not a controlling person of, or a member of a group which controls, such person, and (b) does not, directly or indirectly, own 1% or more of any class of securities of such person; or (iv) interfere with business relationships (whether formed heretofore or hereafter) between the Company or any of its affiliates and customers or suppliers of the Company or any of its affiliates. The term "Restricted Period" shall mean the period ending on the date that is (x) with respect to clause (ii) of this Section 5(A), eighteen (18) months following the end of the Executive's employment by the Company (or any affiliate of the Company) whether or not pursuant to this Agreement and (y) with respect to clauses (i), (iii) and (iv) of this Section 5(A), twelve (12) months following the end of the Executive's employment by the Company (or any affiliates of the Company) whether or not pursuant to this Agreement. (B) NON-DISCLOSURE. The Executive shall, during the Term of this Agreement and at all times thereafter, treat as confidential and, except as required in the performance of his duties and responsibilities under this Agreement, not disclose, publish or otherwise make available to the public or to any individual, firm or corporation any confidential material (as hereinafter defined). The Executive agrees that all confidential material, together with all notes and records of the Executive relating thereto, and all copies or facsimiles thereof in the possession of the Executive, are the exclusive property of the Company or Thomson, as the case may be, and the Executive agrees to return such material to the Company promptly upon the termination of the Executive's employment with the Company. For the purposes hereof, the term "confidential material" shall mean all information acquired by the Executive in the course of the Executive's employment with the Company in any way concerning the products, projects, activities, business or affairs of the Company or Thomson or the customers, suppliers, licensors, licensees or partners of the Company or Thomson, including, without limitation, all information concerning trade secrets and the products or projects of the Company or Thomson and/or any -5- improvements therein, all sales and financial information concerning the Company or Thomson, all customer and supplier lists, all information concerning projects in research and development or marketing plans for any such products or projects, all information concerning technical data, designs, patterns, formulae, computer programs, source code, object code, algorithms and subroutines of the Company or Thomson, and all information in any way concerning the products, projects, activities, business or affairs of customers of the Company or Thomson which is furnished to the Executive by the Company or Thomson or any of their respective employees (current or former), agents or customers, as such; provided, however, that the term "confidential material" shall not include information which (a) becomes generally available to the public other than as a result of a disclosure by the Executive, (b) was available to the Executive on a non-confidential basis prior to his employment with the Company or (c) becomes available to the Executive on a non-confidential basis from a source other than the Company or Thomson or any of their agents, franchisees, creditors, suppliers, lessors, lessees, licensors, licensees, partners or customers provided that such source is not bound by a confidentiality agreement with the Company or Thomson or any of such agents or customers. (C) NON-SOLICITATION. During the Restricted Period, the Executive shall not (i) hire or attempt to hire, or (ii) solicit or entice or attempt to solicit or entice away, any person who is (at the applicable time or was within the six month period prior to any such hire, solicitation or enticement) an officer, employee or consultant of the Company or Thomson Legal & Regulatory (including without limitation Dialog) (in the case of clause (i) above) or the Company or Thomson (in the case of clause (ii) above), as applicable, either for his own account or for any individual, firm or corporation, whether or not such person would commit any breach of his contract of employment by reason of leaving the service of the Company, Thomson or Thomson Legal & Regulatory (including without limitation Dialog), as applicable. (D) DEVELOPMENTS. The Executive agrees that all discoveries, inventions, processes, methods and improvements, conceived, developed or otherwise made by the Executive at any time, alone or with others in any way relating to the Company's present or future business or products, whether patentable or subject to copyright protection and whether or not reduced to practice, during the period of the Executive's employment with the Company ("Developments"), shall be the sole property of the Company. The Executive agrees to, and hereby does, assign to the Company all of the Executive's right, title and interest throughout the world in and to all Developments. The Executive agrees that such Developments shall constitute works made for hire under the copyright laws of the United States and hereby assigns to the Company all copyrights, patents and other proprietary rights the Executive may have in such Developments. The Executive shall make and maintain adequate and current written records of all Developments, and the Executive shall disclose all developments promptly, fully and in writing to the Company promptly after development of the same, and at any time upon request, provided, however, that developments excluded under the following paragraph shall be received by the Company in confidence. The Executive has informed the Company in writing of any continuing obligations to any previous employers which require him not to disclose to the Company any information, and the Executive has also informed the Company in writing of any and all confidential information or Developments which the Executive claims as his own and intends to exclude from the restrictions set forth in the previous paragraph because it was developed by the Executive prior to the commencement of his employment by the Company. There shall also be -6- excluded from the restrictions set forth in the previous paragraph any Development made by the Executive (a) which is developed by the Executive without the use of the Company's property or facilities, (b) which does not make any use of confidential information, (c) which is developed by the Executive entirely on his own time, and (d) which does not relate to the Company's business or to the Company's ongoing or planned research and development efforts. At any time at the request of the Company (and at the Company's expense), the Executive shall execute all documents and perform all lawful acts the Company considers necessary or advisable to secure its rights hereunder and to carry out the intent of this Section 5(D). At any time upon the request of the Company, the Executive shall return promptly to the Company all the Company's property, including all copies of all confidential information or Developments. (E) In the event of a breach or threatened breach by the Executive of any of the provisions of Section 5 of this Agreement, the Executive hereby consents and agrees that the Company shall be entitled to an injunction or similar equitable relief from any court of competent jurisdiction restraining the Executive from committing or continuing any such breach or threatened breach or granting specific performance of any act required to be performed by the Executive under any of such provisions, without the necessity of showing any actual damage or that money damages would not afford an adequate remedy and without the necessity of posting any bond or other security. Nothing herein shall be construed as prohibiting the Company from pursuing any other remedies at law or in equity which it may have with respect to any such breach or threatened breach. 6. MISCELLANEOUS. (A) BENEFITS OF AGREEMENT; NO ASSIGNMENTS; NO THIRD-PARTY BENEFICIARIES. (1) This Agreement will bind and inure to the benefit of the parties hereto and their respective heirs, successors, and permitted assigns. (2) Neither party will assign any rights or delegate any obligations hereunder without the consent of the other party (except that the Company may assign its rights and delegate its obligations hereunder to any affiliate of the Company or to any successor to its business, whether by merger or consolidation, sale of stock or of all or substantially all of its assets, or otherwise), and any attempt to do so will be void. (3) Nothing in this Agreement is intended to or will confer any rights or remedies on any person or entity other than the parties hereto, their respective heirs, successors, and permitted assigns. (B) NOTICES. All notices, requests, payments, instructions, or other documents to be given hereunder will be in writing or by written telecommunication, and will be deemed to have been duly given if (i) delivered personally (effective upon delivery), (ii) mailed by registered or certified mail, return receipt requested, postage prepaid (effective five business days after dispatch), (iii) sent by a reputable, established courier service that guarantees next business day delivery (effective the next business day), or (iv) sent by telecopier followed within 24 hours by confirmation by one of the foregoing methods (effective upon receipt of the telecopy in complete, readable form), addressed to the recipient party at its address set forth in the first paragraph hereof (or to such other address as the recipient party may have furnished to the -7- sending party for the purpose pursuant to this section) and, with respect to any notice given on or prior to the Effective Date, with a copy sent to the Purchaser at its address set forth in the Merger Agreement. (C) COUNTERPARTS. This Agreement may be executed by the parties in separate counterparts, each of which when so executed and delivered will be an original, but all of which together will constitute one and the same agreement. In pleading or proving this Agreement, it will not be necessary to produce or account for more than one such counterpart. (D) CAPTIONS. The captions of sections or subsections of this Agreement are for reference only and will not affect the interpretation or construction of this Agreement. (E) CONSTRUCTION. The language used in this Agreement is the language chosen by the parties to express their mutual intent, and no rule of strict construction will be applied against either party. (F) WAIVERS; AMENDMENTS. No waiver of any breach or default hereunder will be valid unless in writing signed by the waiving party. No failure or other delay by any party exercising any right, power, or privilege hereunder will be or operate as a waiver thereof, nor will any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power, or privilege. No amendment or modification of this Agreement will be valid or binding unless in a writing signed by both the Executive and the Company and, with respect to any amendment or modification of this Agreement prior to the Effective Date, by Purchaser. (G) ENTIRE AGREEMENT. This Agreement contains the entire understanding and agreement between the parties, and supersedes any prior understandings or agreements between them, with respect to the subject matter hereof (including, without limitation, the Original Employment Agreement). The parties acknowledge and agree that any and all agreements between the parties relating to stock options granted by the Company (including its predecessors, successors and affiliates) to the Executive, are superseded by and subject to Section 3.07 of the Merger Agreement. (H) GOVERNING LAW. This Agreement will be governed by and interpreted and construed in accordance with the internal laws of the Commonwealth of Massachusetts, without reference to principles of conflicts or choice of law. * * * -8- IN WITNESS WHEREOF, each of the Company and the Executive has executed and delivered this Agreement as an agreement under seal as of the date first above written. EXECUTIVE: /s/ Lee Phillips - ----------------------------------- COMPANY: /s/ Clifford Pollan - ----------------------------------- -9- -----END PRIVACY-ENHANCED MESSAGE-----