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EXHIBIT 10.3
NONCOMPETITION, NONDISCLOSURE AND NONSOLICITATION AGREEMENT
THIS
NONCOMPETITION, NONDISCLOSURE AND NONSOLICITATION AGREEMENT
("Agreement"), dated as of September 8,
2004, is by and among each and all of
the stockholders of WIRTHLIN WORLDWIDE,
INC., a California corporation
("Wirthlin"), shown on the signature pages
to this Agreement, and also including
individually Richard B. Wirthlin and Joel
White ("Stockholder(s)"), and HARRIS
INTERACTIVE INC., a Delaware corporation
("Harris").
WHEREAS,
Stockholders beneficially own all of the issued and outstanding
shares of Wirthlin common stock, par value
$1.00 (the "Wirthlin Shares");
WHEREAS,
concurrently with the execution and delivery of this Agreement,
Harris will acquire all of the Wirthlin
Shares from Stockholders, pursuant to
the terms of that certain Agreement and
Plan of Merger, dated as of the date
hereof, by and among Harris, Capitol Merger
Sub, LLC, a Delaware limited
liability company of which Harris is the
sole member, Wirthlin, and Stockholders
(the "Merger Agreement"); and
WHEREAS,
the execution and delivery of this Agreement concurrently with
the Merger Agreement is required by
Sections 3.3.1(h) and 3.3.2(f) of the Merger
Agreement.
NOW,
THEREFORE, in consideration of the premises and the
representations,
warranties, covenants and agreements herein
contained, and intending to be
legally bound hereby, Harris and
Stockholders hereby agree as follows:
SECTION 1. - DEFINITIONS
1.1
The following
terms shall have the following meanings when used in
this Agreement. Capitalized terms not
expressly defined in this Agreement shall
have the meanings ascribed to them in the
Merger Agreement.
(a) "Acquired
Business" means the business and affairs of the
Acquired Companies as conducted prior to
the Closing.
(a) "Acquired
Companies" means Wirthlin and its Subsidiaries,
collectively.
(a) "Agreement"
has the meaning given to it in the first paragraph
of this Agreement.
(a) "Business
Day" has the meaning given to it in the Merger
Agreement.
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(a) "Closing"
has the meaning given to it in the Merger Agreement.
(a)
"Confidential Information" is defined in Section 2.1.
(a) "Harris" has
the meaning given to it in the first paragraph of
this Agreement.
(a)
"Harris
Business" means the business and affairs of the Harris
Entities as conducted prior to the
Closing.
(a) "Harris
Employee" means an employee of a Harris Entity
including without limitation any person
employed by a Harris Entity on the date
of this Agreement or at any time thereafter
during the term of this Agreement.
(a) "Harris
Entities" means Harris and its Subsidiaries (including
the Surviving Entity), collectively
(a) "Merger
Agreement" has the meaning given to it in the second
whereas clause of this Agreement.
(a)
"Noncompetition Payment" has the meaning given to it in
Section 5.
(a) "Party"
means Harris or any of Stockholders and "Parties"
means Harris and Stockholders.
(a) "Person(s)"
has the meaning given to it in the Merger
Agreement.
(a)
"Stockholder(s)" has the meaning given to it in the first
paragraph of this Agreement.
(a)
"Subsidiaries" has the meaning given to it in the Merger
Agreement.
(a) "Wirthlin"
has the meaning given to it in the first paragraph
of this Agreement.
(a) "Wirthlin
Shares" has the meaning given to it in the first
whereas clause of this Agreement.
SECTION 2. - ACKNOWLEDGMENTS BY SELLER AND STOCKHOLDERS
2.1
Each Stockholder
acknowledges that such Stockholder has occupied a
position of trust and confidence with the
Acquired Companies prior to the date
hereof and has had access to, and has
become familiar with, some of the
following information relating to the
Acquired Business, whether or not such
information is embodied in writing or other
physical form or is retained in the
memory of any Stockholder (collectively the
"Confidential Information"):
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(a) any and all
information and material proprietary to the
Acquired Companies, not generally known or
available to the public, or that is a
trade secret within the meaning of
applicable law, in each case in which any of
the Acquired Companies has any interest or
rights now or in the future,
including without limitation the Acquired
Companies' business strategies, client
lists, supplier lists, partners, agreement
terms, pricing, databases, products,
designs, processes, systems, methods,
concepts, trade secrets, know-how, data,
technical plans, drawings, information,
computer software and programs
(including object code and source code),
applications, inventions, formulas,
technology, plans, research and
development, and anything else that might be
construed as proprietary or confidential in
nature;
(b) all
historical financial statements, financial projections and
budgets, historical and projected sales,
capital spending budgets and plans, the
names and backgrounds of key personnel,
contractors, agents, suppliers and
potential suppliers, personnel training and
techniques and materials, and
purchasing methods and techniques; and
(c) all notes,
analysis, compilations, studies, summaries and
other material prepared by or for the
Acquired Companies containing or based, in
whole or in part, upon any information
included in the foregoing; and
Notwithstanding the terms of subsections (a) through (c) above,
Confidential Information shall not include
information and material (a) publicly
available through no breach by any
Stockholder of any confidentiality obligation
to the Acquired Companies, (b) released by
any Stockholder with a written waiver
of confidentiality, (c) lawfully obtained
from third parties, or (d) previously
known or developed by third parties
independently of the Acquired Companies and
any Stockholder provided that such
knowledge or development can be independently
substantiated.
2.2
Each Stockholder
acknowledges that:
(a) the Acquired
Business is international in scope;
(b) the products
and services related to the Acquired Business are
marketed throughout the world;
(c) the Acquired
Business competes with other businesses that are,
or could be, located in any part of the
world;
(d) Harris has
required that each Stockholder make the covenants
set forth in Sections 3 and 4 as a
condition to Harris' purchase of the Wirthlin
Shares and payment of the Noncompetition
Payment;
(e) the
provisions of Sections 3 and 4 are reasonable and
necessary to protect and preserve Harris'
operation of the Acquired Business
from and after the Closing; and
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(f) Harris would
be irreparably damaged if any Stockholder were to
breach any of the covenants set forth in
Sections 3 and 4.
SECTION 3. - CONFIDENTIAL INFORMATION
3.1
Each Stockholder
acknowledges and agrees that the protection of the
Confidential Information is necessary to
protect and preserve the value of the
Acquired Business. Therefore, each
Stockholder hereby agrees not to disclose any
Confidential Information to any Persons or
use any Confidential Information for
his or its own account or for the benefit
of any third party, unless, and
limited to extent that, (a) the
Confidential Information is or becomes generally
known to, and available for use by, the
public (other than as a result of any of
the Acquired Companies' or any
Stockholder's fault or the fault of any other
Person bound by a duty of confidentiality
to Harris or any of the Acquired
Companies) or (b) Harris consents in
writing to such disclosure or use.
3.2
Each of the
Stockholders shall deliver to Harris, at any time that
Harris may request, all documents,
memoranda, notes, plans, records, reports and
other documentation, models, components,
devices or computer software, whether
embodied in a disk or in other form (and
all copies of all of the f
