EMPLOYEE BENEFITS AGREEMENT
This EMPLOYEE BENEFITS AGREEMENT is dated as of October 28, 1996 (the "Agreement"), among THE DUN & BRADSTREET CORPORATION, a Delaware corporation ("D&B"), COGNIZANT CORPORATION, a Delaware corporation, ("Cognizant"), and ACNIELSEN CORPORATION, a Delaware corporation ("ACNielsen").
WHEREAS, the Board of Directors of D&B has determined that it is appropriate, desirable and in the best interests of the holders of shares of common stock, par value $1.00 per share, of D&B (the "D&B Common Stock") to take certain steps to reorganize D&B's Subsidiaries (as defined herein) and businesses and then to distribute to the holders of the D&B Common Stock all the outstanding shares of common stock of Cognizant, together with the appurtenant share purchase rights (the "Cognizant Common Shares"), and all the outstanding shares of common stock of ACNielsen, together with the appurtenant share purchase rights (the "ACNielsen Common Shares"); and
WHEREAS, each of D&B, Cognizant and ACNielsen has determined that it is necessary and desirable to allocate and assign responsibility for certain employee benefit matters in respect of such entities on and after the Effective Time (as defined herein).
NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, D&B, Cognizant and ACNielsen agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions. Capitalized terms used in this Agreement shall have the following meanings:
"ACNielsen" shall mean ACNielsen Corporation, a Delaware corporation.
"ACNielsen Bifurcated Savings Plan Employees" shall have the meaning set forth in Section 3.3(a) of this Agreement.
"ACNielsen Common Shares" shall have the meaning set forth in the recitals hereto.
"ACNielsen Employees" shall mean persons who, immediately after the Effective Time, are employed by the ACNielsen Group (including persons who are absent from work by reason of layoff or leave of absence and inactive employees treated as such by agreement therewith).
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"ACNielsen Group" shall mean ACNielsen and each Business Entity which is contemplated to remain or become a Subsidiary of ACNielsen pursuant to the Distribution Agreement.
"ACNielsen Lump-Sum Savings Plan Employees" shall have the meaning set forth in Section 3.3(a) of this Agreement.
"ACNielsen Replacement Plan" shall mean the replacement plan to be adopted by ACNielsen pursuant to Section 6.1(c) of this Agreement.
"ACNielsen Retirement Eligible Employees" shall have the meaning set forth in Section 5.6 of this Agreement.
"ACNielsen Retirement Plan" shall mean the defined benefit plan to be adopted by ACNielsen pursuant to Section 2.3(a) of this Agreement.
"ACNielsen Retirement Plan Effective Date" shall have the meaning set forth in Section 2.3(a) of this Agreement.
"ACNielsen Retirement Plan Segregation Ratio" shall equal a fraction, the numerator of which is the Present Value of the accrued vested and nonvested benefits (as defined in ERISA Section 4044(a)(1)-(6)) of the ACNielsen Transferred Retirement Plan Employees under the D&B Retirement Plan at the Effective Time, and the denominator of which is the Present Value of the accrued vested and nonvested benefits (as defined in ERISA Section 4044(a)(1)-(6)) of the D&B Pre-Distribution Employees under the D&B Retirement Plan at the Effective Time.
"ACNielsen Retirement Plan Transfer Date" shall have the meaning set forth in Section 2.3(b) of this Agreement.
"ACNielsen Savings Plan" shall mean the defined contribution plan to be adopted by ACNielsen pursuant to Section 3.3(a) of this Agreement.
"ACNielsen Savings Plan Transfer Date" shall have the meaning set forth in Section 3.3(b) of this Agreement.
"ACNielsen Transferred Retirement Plan Employees" shall have the meaning set forth in Section 2.3(a) of this Agreement.
"ACNielsen Transferred Savings Plan Employees" shall have the meaning set forth in Section 3.3(a) of this Agreement.
"Action" shall mean any action, suit, arbitration, inquiry, proceeding or investigation by or before any court, any governmental or other regulatory or administrative agency, body or commission or any arbitration tribunal.
"Affiliate" shall mean, when used with respect to a specified person, another person that controls, is controlled by,
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or is under common control with the person specified. As used herein, "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such person, whether through the ownership of voting securities or other interests, by contract or otherwise.
"Ancillary Agreements" shall mean all of the written agreements, instruments, assignments or other written arrangements (other than this Agreement and the Distribution Agreement) entered into in connection with the transactions contemplated by this Agreement and the Distribution Agreement, including, without limitation, the Conveyancing and Assumption Instruments, the Data Services Agreements, the Intellectual Property Agreement, the Shared Transaction Services Agreements, the Tax Allocation Agreement and the Transition Services Agreement.
"Assets" shall have the meaning set forth in Section 1.1(q) of the Distribution Agreement.
"Board of Directors" shall mean, when used with respect to a specified corporation, the board of directors of the corporation so specified.
"Business Entity" shall mean any corporation, partnership, limited liability company or other entity which may legally hold title to Assets.
"COBRA" shall mean the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, and the regulations promulgated thereunder, including any successor legislation.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder, including any successor legislation.
"Cognizant" shall mean Cognizant Corporation, a Delaware corporation.
"Cognizant and ACNielsen Nonqualified Plan Participants" shall have the meaning as set forth in Section 4.2 of this Agreement.
"Cognizant Bifurcated Savings Plan Employees" shall have the meaning set forth in Section 3.2(a) of this Agreement.
"Cognizant Common Shares" shall have the meaning set forth in the recitals hereto.
"Cognizant Employees" shall mean persons who, immediately after the Effective Time, are employed by the Cognizant Group (including persons who are absent from work by reason of layoff or leave of absence and inactive employees treated as such by agreement therewith).
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"Cognizant Group" shall mean Cognizant and each Business Entity which is contemplated to remain or become a Subsidiary of Cognizant pursuant to the Distribution Agreement.
"Cognizant Lump-Sum Savings Plan Employees" shall have the meaning set forth in Section 3.2(a) of this Agreement.
"Cognizant Replacement Plans" shall mean the replacement plans (including, without limitation, the replacement plan for certain IMS employees) to be adopted by Cognizant pursuant to Section 6.1(b) of this Agreement.
"Cognizant Retirement Eligible Employees" shall have the meaning set forth in Section 5.6 of this Agreement.
"Cognizant Retirement Plan" shall mean the defined benefit plan to be adopted by Cognizant pursuant to Section 2.2(a) of this Agreement.
"Cognizant Retirement Plan Effective Date" shall have the meaning set forth in Section 2.2(a) of this Agreement.
"Cognizant Retirement Plan Segregation Ratio" shall equal a fraction, the numerator of which is the Present Value of the accrued vested and nonvested benefits (as defined in ERISA Section 4044(a)(1)-(6)) of the Cognizant Transferred Retirement Plan Employees under the D&B Retirement Plan at the Effective Time, and the denominator of which is the Present Value of the accrued vested and nonvested benefits (as defined in ERISA Section 4044(a)(1)-(6)) of the D&B Pre-Distribution Employees under the D&B Retirement Plan at the Effective Time.
"Cognizant Retirement Plan Transfer Date" shall have the meaning set forth in Section 2.2(b) of this Agreement.
"Cognizant Savings Plan" shall mean the defined contribution plan to be adopted by Cognizant pursuant to Section 3.2(a) of this Agreement.
"Cognizant Savings Plan Transfer Date" shall have the meaning set forth in Section 3.2(b) of this Agreement.
"Cognizant Transferred Retirement Plan Employees" shall have the meaning set forth in Section 2.2(a) of this Agreement.
"Cognizant Transferred Savings Plan Employees" shall have the meaning set forth in Section 3.2 of this Agreement.
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"Conveyancing and Assumption Instruments" shall mean, collectively, the various agreements, instruments and other documents heretofore entered into and to be entered into to effect the transfer of Assets and the assumption of Liabilities in the manner contemplated by the Distribution Agreement, or otherwise arising out of or relating to the transactions contemplated in the Distribution Agreement.
"D&B" shall mean The Dun & Bradstreet Corporation, a Delaware corporation.
"D&B Career Transition Plan" shall mean The Dun & Bradstreet Career Transition Plan.
"D&B Committee" shall mean the Executive Compensation and Stock Option Committee of the Board of Directors of D&B.
"D&B Common Stock" shall have the meaning set forth in the recitals hereto.
"D&B Disabled Employees" shall mean all D&B Pre-Distribution Employees who are receiving benefits under the D&B Long-Term Disability Plan as of the Effective Time.
"D&B Group" shall mean D&B and each Business Entity (other than any member of the Cognizant Group or the ACNielsen Group) that is a Subsidiary of D&B.
"D&B Long-Term Disability Plan" shall mean The Dun & Bradstreet Corporation Long Term Disability Plan or any other long-term disability plan sponsored by D&B or any Subsidiary of D&B prior to the Effective Time.
"D&B LSARs" shall have the meaning set forth in Section 6.2 of this Agreement.
"D&B Nonqualified Plans" shall have the meaning as set forth in Section 4.1 of this Agreement.
"D&B Pension BEP" shall mean the Pension Benefit Equalization Plan of The Dun & Bradstreet Corporation, as amended effective December 21, 1994.
"D&B Pension BEP Trust" shall mean the trust established in connection with the D&B Pension BEP and made as of December 15, 1995.
"D&B Post-Distribution Employees" shall mean persons who, immediately after the Effective Time, are employed by the D&B Group (including persons who are absent from work by reason of layoff or leave of absence and inactive employees treated as such by agreement therewith).
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"D&B Pre-Distribution Employees" shall mean persons who, at any time prior to the Effective Time, were employed by D&B or its Subsidiaries.
"D&B Retirees" shall mean persons who (i) were D&B Pre-Distribution Employees, (ii) terminated employment from D&B prior to the Effective Time and (iii) are neither Cognizant Employees nor ACNielsen Employees immediately after the Effective Time.
"D&B Retirement Plan" shall mean the Master Retirement Plan of The Dun & Bradstreet Corporation, as amended and restated effective January 1, 1994, with certain earlier effective dates.
"D&B Savings BEP" shall mean the Profit Participation Benefit Equalization Plan of The Dun & Bradstreet Corporation, as amended and restated effective January 1, 1995.
"D&B Savings Plan" shall mean the Profit Participation Plan of The Dun & Bradstreet Corporation, as in effect on January 1, 1994, with certain earlier effective dates.
"D&B Stock Option" shall have the meaning set forth in Section 6.1 of this Agreement.
"D&B Stock Option Plans" shall mean (i) the 1982 Key Employees Stock Option Plan for The Dun & Bradstreet Corporation and Subsidiaries and (ii) the 1991 Key Employees Stock Option Plan for The Dun & Bradstreet Corporation and Subsidiaries.
"D&B Supplemental EBP" shall mean the Supplemental Executive Benefit Plan of The Dun & Bradstreet Corporation, as amended effective December 21, 1994.
"D&B Supplemental EBP Trust" shall mean the trust established in connection with the D&B Supplemental EBP and made as of December 15, 1995.
"Daily Average Trading Price" of a given stock on a given day shall mean the average of the high and low trading prices for such stock on such date.
"Data Services Agreements" shall mean the Data Services Agreements to be entered into by D&B, Cognizant and ACNielsen.
"Distribution" shall mean the distribution on the Distribution Date to holders of record of shares of D&B Common Stock as of the Distribution Record Date of (i) the Cognizant Common Shares owned by D&B on the basis of one Cognizant Common Share for each outstanding share of D&B Common Stock and (ii) the ACNielsen Common Shares owned by D&B on the basis of one share of ACNielsen Common Share for each three outstanding shares of D&B Common Stock.
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"Distribution Agreement" shall mean the Distribution Agreement among D&B, Cognizant and ACNielsen.
"Distribution Date" shall mean such date as may hereafter be determined by D&B's Board of Directors as the date as of which the Distribution shall be effected.
"Distribution Record Date" shall mean such date as may hereafter be determined by D&B's Board of Directors as the record date for the Distribution.
"Effective Time" shall mean 12:01 a.m., New York time, on the Distribution Date.
"Employee Benefit Dispute" shall include any controversy, dispute or claim arising out of, in connection with, or in relation to the interpretation, performance, nonperformance, validity or breach of this Agreement or otherwise arising out of, or in any way related to this Agreement or the transactions contemplated hereby, including, without limitation, any claim based on contract, tort, statute or constitution.
"Employee Benefit Litigation Liability" shall mean, with respect to a Business Entity, a Liability relating to a controversy, dispute or claim arising out of, in connection with or in relation to the interpretation, performance, nonperformance, validity or breach of an Employee Benefit Plan of such Business Entity or otherwise arising out of, or in any way related to such Employee Benefit Plan, including, without limitation, any claim based on contract, tort, statute or constitution.
"Employee Benefit Plans" shall mean, with respect to a Business Entity, all "employee benefit plans" (within the meaning of Section 3(3) of ERISA), "multiemployer plans" (within the meaning of Section 3(37) of ERISA), retirement, pension, savings, profit-sharing, welfare, stock purchase, stock option, equitybased, severance, employment, change-in-control, fringe benefit, collective bargaining, bonus, incentive, deferred compensation and all other employee benefit plans, agreements, programs, policies or other arrangements (including any funding mechanisms therefor), whether or not subject to ERISA, whether formal or informal, oral or written, legally binding or not, under which (i) any past, present or future employee of the Business Entity or its Subsidiaries has a right to benefits and (ii) the Business Entity or its Subsidiaries has any Liability.
"Employee Benefit Records" shall mean all agreements, documents, books, records or files relating to the Employee Benefit Plans of D&B, Cognizant and ACNielsen.
"Employee Benefit Welfare Plans" shall mean, with respect to a Business Entity, all Employee Benefit Plans that are "welfare plans" within the meaning of Section 3(1) of ERISA.
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"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as amended, and the regulations promulgated thereunder, including any successor legislation.
"ESOP" shall mean an "employee stock ownership plan" within the meaning of Section 4975(e)(7) of the Code.
"FSA Coverage Period" shall have the meaning set forth in Section 5.4 of this Agreement.
"IMS" shall mean I.M.S. International, Inc., a Delaware corporation.
"Information Statement" shall mean the Information Statement sent to the holders of shares of D&B Common Stock in connection with the Distribution, including any amendment or supplement thereto.
"Intellectual Property Agreement" shall mean the intellectual property and licensing agreement among D&B, Cognizant and ACNielsen.
"Liabilities" shall mean any and all losses, claims, charges, debts, demands, actions, causes of action, suits, damages, obligations, payments, costs and expenses, sums of money, accounts, reckonings, bonds, specialties, indemnities and similar obligations, exonerations, covenants, contracts, controversies, agreements, promises, doings, omissions, variances, guarantees, make whole agreements and similar obligations, and other liabilities, including all contractual obligations, whether absolute or contingent, matured or unmatured, liquidated or unliquidated, accrued or unaccrued, known or unknown, whenever arising, and including those arising under any law, rule, regulation, Action, threatened or contemplated Action (including the costs and expenses of demands, assessments, judgments, settlements and compromises relating thereto and attorneys' fees and any and all costs and expenses (including allocated costs of in-house counsel and other personnel), whatsoever reasonably incurred in investigating, preparing or defending against any such Actions or threatened or contemplated Actions), order or consent decree of any governmental or other regulatory or administrative agency, body or commission or any award of any arbitrator or mediator of any kind, and those arising under any contract, commitment or undertaking, including those arising under this Agreement, the Distribution Agreement or any Ancillary Agreement, in each case, whether or not recorded or reflected or required to be recorded or reflected on the books and records or financial statements of any person.
"Participant Election Period" shall mean the period during which the elections described in Sections 3.2 and 3.3 are permitted (such period, in no event, to be less than 30 days
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following notice thereof to persons who are eligible to make the election).
"PBGC" shall mean the Pension Benefit Guaranty Corporation or any successor entity thereto.
"PBGC Assumptions" shall mean the actuarial assumptions set forth in 29 C.F.R. Part 2619, et seq.
"person" shall mean any natural person, corporation, business trust, joint venture, association, company, partnership or government, or any agency or political subdivision thereof.
"Present Value" shall mean the single sum value of a series of future payments, determined utilizing PBGC Assumptions in effect as of the measurement date.
"Service" shall mean the Internal Revenue Service or any successor entity thereto.
"Shared Transaction Services Agreements" shall mean the Shared Transaction Services Agreements among D&B, Cognizant and ACNielsen.
"Subsidiary" shall mean any corporation, partnership or other entity of which another entity (i) owns, directly or indirectly, ownership interests sufficient to elect a majority of the Board of Directors (or persons performing similar functions) (irrespective of whether at the time any other class or classes of ownership interests of such corporation, partnership or other entity shall or might have such voting power upon the occurrence of any contingency) or (ii) is a general partner or an entity performing similar functions (e.g., a trustee).
"Tax Allocation Agreement" shall mean the Tax Allocation Agreement among D&B, Cognizant and ACNielsen.
"Transition Services Agreement" shall mean the Transition Services Agreement among D&B, Cognizant and ACNielsen.
ARTICLE II
DEFINED BENEFIT PLANS
SECTION 2.1. D&B Retirement Plan. From and after the Effective Time, D&B shall continue to sponsor the D&B Retirement Plan for the benefit of D&B Post-Distribution Employees, D&B Retirees and D&B Disabled Employees. Active participation of Cognizant Employees and ACNielsen Employees in the D&B Retirement Plan shall cease immediately after the Effective Time.
SECTION 2.2. Cognizant Retirement Plan. (a) As soon as practicable after the Effective Time, but not later than the first day of the fourth calendar month that begins after the
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Effective Time (herein referred to as the "Cognizant Retirement Plan Effective Date"), Cognizant shall establish the Cognizant Retirement Plan for the benefit of Cognizant Employees who were participants in the D&B Retirement Plan immediately prior to the Effective Time (the "Cognizant Transferred Retirement Plan Employees"). As soon as practicable after the Effective Time, D&B shall cause the trustee of the D&B Retirement Plan to segregate the assets of the D&B Retirement Plan allocable to Cognizant Transferred Retirement Plan Employees in an amount equal to the sum of (i) and (ii), as follows:
(i) the amount allocable to Cognizant Transferred Retirement Plan
Employees under ERISA Section 4044 as of the Effective Time,
determined using PBGC Assumptions; and
(ii) the excess (if any) of the fair market value of assets of the D&B
Retirement Plan over the Present Value of the vested and nonvested
benefits accrued thereunder for all the D&B Pre-Distribution
Employees as of the Effective Time, multiplied by the Cognizant
Retirement Plan Segregation Ratio.
(b) As soon as practicable after the Effective Time, the assets allocable to the Cognizant Transferred Retirement Plan Employees shall be transferred to a separate trust established under the Cognizant Retirement Plan (such date herein referred to as the "Cognizant Retirement Plan Transfer Date"); provided, however, that in no event shall such transfer take place until (i) D&B has made all required filings and submissions to the appropriate governmental agencies and (ii) Cognizant has furnished to D&B (A) a favorable determination letter that the Cognizant Retirement Plan is qualified under Section 401(a) of the Code or (B) an opinion letter from Simpson Thacher & Bartlett to the effect that the Cognizant Retirement Plan is qualified under Section 401(a) of the Code. The value of such assets to be transferred shall equal the value of segregated assets determined under Section 2.2(a) of this Agreement, adjusted as follows:
(i) reduced by the amount of benefit payments made under the D&B
Retirement Plan with respect to Cognizant Transferred Retirement
Plan Employees from the Effective Time to the Cognizant Retirement
Plan Transfer Date; and
(ii) increased (or decreased) by the share of the net investment income
(or loss) from the Effective Time to the Cognizant Retirement Plan
Transfer Date attributable to the value of such segregated assets.
(c) Unless otherwise agreed to by D&B and Cognizant (as well as ACNielsen if it has assets in the D&B Retirement Plan on the Cognizant Retirement Plan Transfer Date), the form of the assets to be transferred shall consist of an undivided percentage
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interest in each asset that is held by the D&B Retirement Plan on the Cognizant Retirement Plan Transfer Date, such undivided percentage interest being equal to the value of assets allocable to the Cognizant Transferred Retirement Plan Employees, divided by the fair market value of plan assets.
(d) Prior to the Cognizant Retirement Plan Transfer Date, all benefit payments to Cognizant Transferred Retirement Plan Employees shall be made from the D&B Retirement Plan.
SECTION 2.3 ACNielsen Retirement Plan. (a) As soon as practicable after the Effective Time, but not later than the first day of the fourth calendar month that begins after the Effective Time (herein referred to as the "ACNielsen Retirement Plan Effective Date"), ACNielsen shall establish the ACNielsen Retirement Plan for the benefit of ACNielsen Employees who were participants in the D&B Retirement Plan immediately prior to the Effective Time (the "ACNielsen Transferred Retirement Plan Employees"). As soon as practicable after the Effective Time, D&B shall cause the trustee of the D&B Retirement Plan to segregate the assets of the D&B Retirement Plan allocable to ACNielsen Transferred Retirement Plan Employees in an amount equal to the sum of (i) and (ii), as follows:
(i) the amount allocable to ACNielsen Transferred Retirement Plan
Employees under ERISA Section 4044 as of the Effective Time,
determined using PBGC Assumptions; and
(ii) the excess (if any) of the fair market value of assets of the D&B
Retirement Plan over the Present Value of the vested and nonvested
benefits accrued thereunder for all the D&B Pre-Distribution
Employees as of the Effective Time, multiplied by the ACNielsen
Retirement Plan Segregation Ratio.
(b) As soon as practicable after the Effective Time, the assets allocable to the ACNielsen Transferred Retirement Plan Employees shall be transferred to a separate trust established under the ACNielsen Retirement Plan (such date herein referred to as the "ACNie ...
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