**SECURITIES AND EXCHANGECOMMISSION**

**Washington, D.C.  20549**

 

**FORM 10-Q**

 

**(Mark One)**

 
| **ý**                                         | ** ** | **Quarterly Report Pursuant to Section 13 or 15(d)  of The Securities Exchange Act of 1934.**  |
|----------------------------------------------------|------------|------------------------------------------------------------------------------------------------|
|                                               |       |                                                                                           |
| **For the quarterly period ended March 31,  2006** |
|                                               |       |                                                                                           |
| **o**                                              | ** ** | **Transition report pursuant to Section 13 or  15(d) of the Securities Exchange Act of 1934.** |

 

**Commission file number 333-108592**

 

**INFORMATIONRESOURCES, INC.****LITIGATIONCONTINGENT PAYMENT RIGHTS TRUST**

 (Exact name of registrant asspecified in its charter)

 
| **Delaware**                                                               | ** ** | **20-0271216**                       |
|----------------------------------------------------------------------------|------------|--------------------------------------|
| (State or other jurisdiction of incorporation or  organization)            |       | (I.R.S. Employer Identification No.) |
|                                                                       |       |                                 |
| **150 North Clinton Street, Chicago, Illinois  60661**                     |
| (Address of principal executive offices) (Zip Code)                        |
|                                                                       |       |                                 |
| Registrant’s telephone number, including area code **(312) 726-1221** |

 

Indicate by check mark if theregistrant is a well-known seasonal issuer, as defined in Rule 405 of theSecurities Act. oYes   ý No

 

Indicate by checkmark if theregistrant is not required to file reports pursuant to Section 13 or Section15(d) of the Act. oYes  ý No

 

Indicate by check mark whetherthe registrant (1) has filed all reports required to be filed bySection 13 or 15(d) of the Securities Exchange Act of 1934 during thepreceding 12 months (or for such shorter period that the registrant wasrequired to file such reports), and (2) has been subject to such filingrequirements for the past 90 days. Yes   ý   No   o

 

Indicate by check mark whetherthe registrant is a large accelerated filer, an accelerated filer, or a non-acceleratedfiler. See definition of “accelerated filer and large accelerated filer” inRule 12b-2 of the Exchange Act. (Check one):

 
| Large accelerated filer o |   | Accelerated filer o |   | Non-accelerated filer ý |
|---------------------------|--------|---------------------|--------|------------------------------|

 

Indicate by check mark whetherthe registrant is a shell company (as defined in Rule 12b-2 of theExchange Act). Yes  o   No  ý

 

At April 17, 2006, there were32,138,891 rights certificates, no par value, outstanding. (1)

 

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(1)   In addition to the number ofrights certificates issued and outstanding at April 17, 2006, there were also94,243 rights certificates not yet issued as of April 17, 2006 to holders ofrecord of Information Resources, Inc. stock who have not yet tendered theirshares for merger consideration consisting of $3.30 per share plus one rightscertificate per share. Any payments made with respect to rights certificateswill also be made with respect to these unissued rights certificates.

 

 

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**PART I — FINANCIAL INFORMATION**

 

**Item1.  *Financial Statements.***

 

**INFORMATION RESOURCES, INC. LITIGATION CONTINGENT PAYMENT RIGHTS TRUST**

 

**BALANCE SHEETS**

 
| ** **                                                                                                                                                        | ** ** | **March 31, 2006** | ** ** | **December 31, 2005** | ** ** |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|--------------------|------------|----------------------------|------------|
| ** **                                                                                                                                                        | ** ** | **(Unaudited)**    | ** ** | ** **                 | ** ** |
| **ASSETS**                                                                                                                                                        | ** ** | ** **         | ** ** | ** **                 | ** ** |
|                                                                                                                                                              |       |               |       |                       |       |
| Cash and  cash equivalents                                                                                                                                        |       | $                  | 22,613,968 |                       |       |   |
|                                                                                                                                                              |       |               |       |                       |       |
| TOTAL ASSETS                                                                                                                                                      |       | $                  | 22,613,968 |                       | $          | — |   |
|                                                                                                                                                              |       |               |       |                       |       |
| **LIABILITIES  AND CERTIFICATEHOLDERS’ EQUITY**                                                                                                              | ** ** | ** **         | ** ** | ** **                 | ** ** |
|                                                                                                                                                              |       |               |       |                       |       |
| Due to  Certificateholders                                                                                                                                        |       | $                  | 22,613,968 |                       | —     |   |
|                                                                                                                                                              |       |               |       |                       |       |
| TOTAL  LIABILITIES                                                                                                                                                |       | $                  | 22,613,968 |                       | $          | — |   |
|                                                                                                                                                              |       |               |       |                       |       |
| **CERTIFICATEHOLDERS’  EQUITY**                                                                                                                              | ** ** | ** **         | ** ** | ** **                 | ** ** |
|                                                                                                                                                              |       |               |       |                       |       |
| Certificateholders’ Equity Certificates, no  par value, 32,259,364 authorized, of which 32,138,891 and 32,138,761 were  issued and outstanding, respectively |       | —             |       | —                     |       |
| Contributed  Capital                                                                                                                                              |       | 717,677            |       | 585,393                    |       |
| Accumulated  Deficit                                                                                                                                              |       | (717,677           | )          | (585,393                   | )          |
| Total  Certificateholders’ Equity                                                                                                                            |       | —             |       | —                     |       |
|                                                                                                                                                              |       |               |       |                       |       |
| TOTAL  LIABILITIES AND CERTIFICATEHOLDERS’ EQUITY                                                                                                            |       | $                  | 22,613,968 |                       | $          | — |   |

 

The accompanying notes to financial statements arean integral part of these statements.

 

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**INFORMATION RESOURCES, INC. LITIGATIONCONTINGENT PAYMENT RIGHTS TRUST**

 

**STATEMENT OF OPERATIONS**

**(UNAUDITED)**

 
| ** **         | ** ** | **Three Months Ended** | ** ** | **Three Months Ended**  | ** ** |
|--------------------|------------|------------------------|------------|-------------------------|------------|
| ** **         | ** ** | **March 31, 2006**     | ** ** | **March 31, 2005** | ** ** |
| REVENUE            |       | $                      | 22,613,968 |                    | $          | — |   |
|               |       |                   |       |                    |       |
| EXPENSES           |       |                   |       |                    |       |
| Rights Agents fees |       | (30,000                | )          | (30,000                 | )          |
| Legal fees         |       | (65,927                | )          | (48,953                 | )          |
| Audit fees         |       | (22,000                | )          | (6,625                  | )          |
| Other fees         |       | (14,357                | )          | (1,572                  | )          |
|               |       |                   |       |                    |       |
| Total  expenses    |       | (132,284               | )          | (87,150                 | )          |
|               |       |                   |       |                    |       |
| Net income  (loss) |       | $                      | 22,481,684 |                    | $          | (87,150 | ) |

 

The accompanying notes to financial statements arean integral part of these statements.

 

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**INFORMATION RESOURCES, INC.  LITIGATION CONTINGENT PAYMENTRIGHTS TRUST**

 

**STATEMENT OF CASH FLOWS(UNAUDITED)**

 
| ** **                                           | ** ** | **Three Months Ended** | ** ** | **Three Months Ended** | ** ** |
|------------------------------------------------------|------------|------------------------|------------|------------------------|------------|
| ** **                                           | ** ** | **March 31, 2006**     | ** ** | **March 31, 2005**     | ** ** |
| CASH FLOWS  FROM OPERATING ACTIVITIES:               |       |                   |       |                   |       |
|                                                 |       |                   |       |                   |       |
| Net income  (loss)                                   |       | $                      | 22,481,684 |                   | $          | (87,150 | ) |
|                                                 |       |                   |       |                   |       |
| Net cash provided by (used in) operating  activities |       | 22,481,684             |       | (87,150                | )          |
|                                                 |       |                   |       |                   |       |
| CASH FLOWS  FROM FINANCING ACTIVITIES:               |       |                   |       |                   |       |
|                                                 |       |                   |       |                   |       |
| Capital  contribution from IRI Holdings, Inc.        |       | 132,284                |       | 87,150                 |       |
|                                                 |       |                   |       |                   |       |
| Net cash provided by financing activities            |       | 132,284                |       | 87,150                 |       |
|                                                 |       |                   |       |                   |       |
| Net change in cash and cash equivalents              |       | 22,613,968             |       | —                 |       |
|                                                 |       |                   |       |                   |       |
| Cash and  cash equivalents at beginning of period    |       | —                 |       | —                 |       |
|                                                 |       |                   |       |                   |       |
| Cash and  cash equivalents at end of period          |       | $                      | 22,613,968 |                   | $          | — |   |

 

The accompanying notes to financial statements arean integral part of these statements.

 

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**INFORMATION RESOURCES, INC. LITIGATIONCONTINGENT PAYMENT RIGHTS TRUST**

**NOTES TO FINANCIAL STATEMENTS**

**(UNAUDITED)**

 

**1.     SUMMARYOF ACCOUNTING POLICIES**

 

**Principlesof Presentation**

 

The Information Resources, Inc. LitigationContingent Payment Rights Trust (the “trust”) is a statutory trust createdunder Delaware law pursuant to an initial declaration of trust and the filingof a certificate of trust with the Delaware Secretary of State onAugust 27, 2003. The trust was createdin connection with the tender offer by Gingko Acquisition Corporation, awholly-owned subsidiary of IRI Holdings, Inc. (formerly known as GingkoCorporation), to purchase all outstanding shares of Information Resources, Inc.common stock (and associated preferred share purchase rights) for $3.30 net pershare in cash, plus one contingent value rights certificate (“RightsCertificate”) per share, and the subsequent second-step merger ofGingko Acquisition Corp. with and into Information Resources pursuant tothe Agreement and Plan of Merger dated as of September 7, 2003, as amended,by and among Information Resources, IRI Holdings, Inc. and Gingko AcquisitionCorp. The second-step merger wascompleted on December 12, 2003.

 

The trust has nobusiness operations. The assets of the trust consist primarily of the right toreceive a portion of any proceeds received by Information Resources in anyjudgment or settlement in the litigation (the “antitrust litigation” or “litigation”)brought by Information Resources against The Dun & BradstreetCorp., The A.C. Nielsen Company (now owned by VNU, N.V.) and IMSInternational, Inc. in the United States District Court for the SouthernDistrict of New York, entitled Information Resources, Inc. v. TheDun & Bradstreet Corp., et. al. No. 96 CIV. 5716 (as described below under “TheLitigation”).

 

**Cash andCash Equivalents**

 

Cash and cash equivalentsinclude cash on hand and funds held in money market accounts or short terminvestments with a maturity of three months or less.

 

**InterimFinancial Statements**

 

The interim financialstatements are unaudited, but include all adjustments necessary (consisting ofnormal recurring adjustments), in the opinion of the litigation trustees, for afair statement of financial position and results of operations for the periodpresented.  The preparation of interimfinancial statements necessarily relies on estimates, requiring the use ofcaution in estimating results for the full year based on interim results ofoperations.

 

**2.     THELITIGATION AND SETTLEMENT THEREOF**

 

The following description of the antitrust litigationhas been obtained from publicly available documents filed with the Securitiesand Exchange Commission (SEC) by Information Resources, as updated from time totime in publicly available documents filed with the SEC by the trust. It doesnot purport to be a full or complete description of the legal or factual issuespresented, the court opinions rendered or the relevant law.

 

GENERAL. On July 27, 1996,Information Resources filed an antitrust lawsuit against The Dun &Bradstreet Corp., A.C. Nielsen Company and IMS International, Inc. in theUnited States District Court for the Southern District of New York entitledInformation Resources, Inc. v. The Dun & Bradstreet Corp., et al.No. 96 CIV. 5716. In the lawsuit, Information Resources alleged that thedefendants violated Sections 1 and 2 of the Sherman Act, 15 U.S.C.Sections 1 and 2, and the common law by engaging in a series ofunlawful practices through which Information Resources claimed that defendantsattempted to regain monopoly power in the U.S. market for retail trackingservices and exclude competition from 30 markets outside the U.S., whereNielsen dominated. Through the antitrust litigation, Information Resourcessought to enjoin those practices and to recover damages in

 

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excess of $650 million,before trebling. Information Resources demanded a trial by jury, and the casewas assigned to the Honorable Louis L. Stanton. It was InformationResources’ position that it continued to suffer damages to the present as aresult of the defendants’ allegedly unlawful practices which it believes wereaimed at undermining competition by financially crippling InformationResources. Information Resources was represented by the law firms of HagensBerman Sobol Shapiro LLP, Freeborn & Peters LLP and Fried, Frank,Harris, Shriver & Jacobson LLP in the litigation.

 

SETTLEMENT OFTHE LITIGATION. On February 16, 2006, Information Resources and the trustannounced that Information Resources and the defendants in the litigation hadentered into a settlement agreement, effective as of February 16, 2006,pursuant to which they agreed to settle all disputes between them arising fromthe facts and circumstances that were alleged or asserted, or could have beenalleged or asserted, in the litigation in consideration for a payment of $55million by A.C. Nielsen Company to Information Resources. Payment of $55million was made to Information Resources’ counsel, Hagens Berman Sobol ShapiroLLP, as escrow agent, on February 16, 2006, to be held by Hagens Berman inan interest-bearing account for the benefit of Information Resources pendingdismissal of the litigation by the Second Circuit Court of Appeals. OnMarch 7, 2006, the Second Circuit Court of Appeals dismissed the litigationwith prejudice.

 

OnMarch 20, 2006, Hagens Berman transferred the settlement amount of $55million, plus $190,838 of interest accrued thereon, to IRI Holdings, Inc.,to be held by IRI Holdings, Inc. in a segregated account pending finaldetermination of the amounts owed to the trust. On March 22, 2006, IRIHoldings, Inc. transferred the amount of $19,875,965 to the trust as the “CVRPayment Amount” due to the trust in accordance with the terms of the contingentvalue rights agreement. IRI Holdings, Inc. withheld from the CVR PaymentAmount the amount of $280,992 to pay for certain future expected expenses ofthe trust. To the extent the actual expenses of the trust are less than theamount withheld by IRI Holdings, Inc. to pay these expenses, IRI Holdings, Inc.will transfer the excess, plus interest accrued thereon, to the trust prior todistribution to the rights certificate holders. On March 23, 2006,Information Resources transferred the amount of $2,738,003 to the trust fromthe escrow account established to pay claims expenses (see Note 3 below).Information Resources retained in the escrow account the amount of $200,000,plus interest earned on the escrow account from February 1, 2006, to pay forfuture expected claims expenses, as well as certain future expenses of thetrust to the extent the expenses of the trust exceed the amount withheld by IRIHoldings from the CVR Payment Amount to pay for these expenses as set forthabove.  After all expenses have been paidin full, any balance remaining in the escrow account, plus interest accruedthereon, will be transferred to the trust immediately prior to distribution tothe rights certificate holders.

 

**3.     CLAIMSEXPENSES / ESCROW ACCOUNT**

 

Claims expenses are generallyincurred and paid by Information Resources and are then reimbursed toInformation Resources out of the escrow account referred to in the nextparagraph. “Claims expenses” means the sum of all direct expenses incurredafter the date of the merger agreement by IRI Holdings, Inc., InformationResources, Information Resources’ subsidiaries, and their affiliates toprosecute the antitrust litigation, generally (i) including any amountspaid to or on behalf of the rights agents (the persons responsible fordirecting the antitrust litigation for the benefit of Information Resources andthe rights certificate holders) but (ii) excluding(A) contingency-based fees, (B) any payment of the independentaccounting firm costs and expenses, (C) any fees, expenses or costsassociated with the trust and (D) any fees, expenses or costs associatedwith registering the rights certificates under the Securities Act or any fees,expenses or costs associated with complying with the Securities Act, theSecurities Exchange Act of 1934 and other securities laws.

 

Pursuant to thecontingent value rights agreement, on December 12, 2003 IRI Holdings, Inc.placed the cash amount of $10 million, plus interest in the amount of$45,548, in an escrow account held by LaSalle Bank National Association asescrow agent, free of any liens or encumbrances of any kind (except aspermitted in the contingent value rights agreement), to support the prosecutionof the antitrust litigation and the payment of claims expenses. The escrowaccount is in the name of Information Resources but is restricted in use tofunding claims expenses for the antitrust litigation. As of March 31, 2006, theescrow account balance was $270,967.

 

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**4.     TRUSTEXPENSES**

 

Pursuant tothe contingent value rights agreement, Information Resources will generally beresponsible for the expenses of the trust, subject to Information Resources’prior approval of those expenses. Information Resources will also beresponsible for all expenses relating to the indemnification obligations of thetrust described in the Registration Statement on Form S-4 with respect to therights certificates, as filed by the trust with, and declared effective by, theSEC on October 30, 2003 (SEC File Number 333-108592) (the “Prospectus”)or compliance with securities laws and the rules of the OTC BulletinBoard.

 

The trust expenses for whichInformation Resources will generally be responsible include all expensesrelated to the purchase and maintenance of liability insurance to providecoverage to the rights agents for their actions under the contingent valuerights agreement and to cover the trust’s indemnification obligations describedin the Prospectus, except for those expenses defined in the contingent valuerights agreement as “Excess Insurance Expenses,” which Information Resourceswill be entitled to deduct from the amounts payable to the trust. “ExcessInsurance Expenses” are defined as the aggregate amount of expenses incurredpursuant to Information Resources’ obligation to obtain liability insurance forthe benefit of the rights agents and to cover the trust’s indemnificationobligations, or in order to obtain and maintain directors and officersinsurance for IRI Holdings, Information Resources and their subsidiaries,but in each case only the aggregate amount in excess of the aggregate amountthat would have been paid if the rights certificates were non-transferablecontractual rights rather than publicly traded, registered securities. Theseamounts are to be determined by decision of a majority of the rights agents or,if there are fewer than five rights agents, by unanimous approval of the rightsagents, on an annual basis within 30 days of the end of each year.

 

Information Resources advisedthe trust that there were no separately identifiable excess insurance expensesfor the policy year October 31, 2003 through October 31, 2004.Information Resources obtained liability insurance coverage for the trust forthe policy year October 31, 2004 through October 31, 2005 without theparticipation of the trust and was unable to determine the amount of excessinsurance expenses for that policy year. As a result, the rights agents andInformation Resources have agreed that, to the extent excess insurance expensesexist for the October 31, 2004 through October 31, 2005 policy year,Information Resources will be solely responsible for them, without recourse tothe trust. For the policy year October 31, 2005 through October 31,2006, Information Resources has obtained liability insurance for the trust fora total premium amount of $212,000, of which $42,400 is considered excessinsurance expenses, as determined by the rights agents. As a result of thesettlement of the litigation, the existence of the trust will be cancelled onceall payments have been made in accordance with the trust agreement. The rightsagents expect that the trust will be cancelled prior to the expiration of thepolicy year October 31, 2005 through October 31, 2006, at which timethe trust’s liability insurance policy will be converted into a 6 year tailpolicy. Information Resources has received a quote of $445,795 for such tailpolicy, assuming no material changes in risk occur prior to the time the trustis cancelled. Of this total premium amount, $89,159 will be considered excessinsurance expenses, as determined by the rights agents. Information Resourceswill also be entitled to a credit against the costs of the tail policy for anyportion of the current term that remains at the time the tail policy goes intoeffect, thereby reducing the total premium amount, and the amount of excessinsurance expenses, slightly.

 

As discussedabove, Information Resources will be reimbursed for “claims expenses.” Anyexpenses not imposed on Information Resources as described above will begeneral obligations of the trust, payable out of the trust’s assets (includingout of any rights certificate payment amounts received pursuant to thecontingent value rights agreement). Information Resources will be entitled todeduct from the amounts payable to the trust under the contingent value rightsagreement certain expenses of the trust described in the contingent valuerights agreement, including those expenses identified as excess insuranceexpenses.

 

**5.     COMPENSATIONAND EXPENSES OF RIGHTS AGENTS**

 

Beginning December 2003, therights agents appointed by the Board of Directors of Information Resources thatwas in place prior to the completion of the merger, referred to as the CVRRights Agents, are each to be paid at least $5,000 per month on the first dayof each month until the last rights certificate payment date, and theindependent rights agent appointed by the other rights agents, referred to asthe Independent Rights Agent, may be paid a fair and reasonable amount ofcompensation until the last payment date that is agreed to by a majority of therights agents (other than the Independent Rights Agent). These payments arepayable as claims expenses. Generally, all reasonable expenses anddisbursements incurred by the rights agents in connection with the

 

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discharge oftheir duties will also be payable by Information Resources as claims expenses.The rights agents appointed by the current Board of Directors of InformationResources, referred to as the Parent Rights Agents, are not entitled to anycompensation for their service as Parent Rights Agents. As of March 31,2006, the total amount of $30,000 was incurred as compensation payments to theCVR Rights Agents for the first quarter of 2006.

 

**6.     PAYMENTSTO CERTIFICATEHOLDERS**

 

Each rightscertificate entitles its holder to receive a pro rata portion of any amountreceived by the trust in respect of antitrust litigation proceeds under theterms of the contingent value rights agreement. Pursuant to the terms of thecontingent value rights agreement, the trust will be entitled to be paid by IRIHoldings, Inc. an amount equal to 68% of any proceeds received byInformation Resources in respect of the antitrust litigation (whether bysettlement, judgment or otherwise), to the extent such proceeds are equal to orless than $200 million, and 75% of any such proceeds in excess of$200 million, in each case subject to adjustments described in theProspectus for certain items, including for taxes that Information Resourceswill be required to pay on the recovery (assumed to be at a rate of 34%) andany contingency-based fees payable to outside counsel in connection with theantitrust litigation. The remaining 32% of any such proceeds, to the extentsuch proceeds are equal to or less than $200 million, and 25% of any suchproceeds in excess of $200 million (again, in each case, subject tocertain adjustments described in the Prospectus) will be retained and remainthe property of Information Resources and its then-current owners.

 

The trust expects to make a single payment to theholders of rights certificates as follows: Upon the receipt of all amounts tobe paid to the rights certificate holders from IRI Holdings, Inc. andInformation Resources pursuant to the contingent value rights agreement, theinstitutional trustee of the trust will transfer the aggregate rightscertificate payment amount to the payment agent designated pursuant to thedeclaration of trust. No later than May 19, 2006, the paying agent willsend a form letter of transmittal to each rights certificateholder ofrecord with instructions for completion and submission of payment documentationto the paying agent. The distribution date for payment to the rightscertificateholders is currectly expected to be June 15, 2006. Beginning June15, 2006, upon receipt by the paying agent of proper payment documentation froma rights certificateholder of record, the paying agent will promptly make theappropriate payment to the holder. For those holders of Information Resourcesstock who have not yet tendered their shares for the merger consideration, thetrust will provide to Information Resources an amount equal to the per rightscertificate payment amount for each such Information Resources share not yettendered. Information Resources will retain this amount in a segregated accountfor payment in accordance with the terms of the merger agreement. To the extentthere is a residual amount remaining in the trust after payments are made asset forth above, and such residual amount is less than the expected costs tomake a subsequent payment to the rights certificate holders, the rights agentsand litigation trustees have agreed that such amount will be contributed to anational charitable organization selected by the rights agents.

 

**ITEM2.   *Management’s Discussionand Analysis of Financial Condition and Results of Operations.***

 

**Introduction**

 

As of 1996, InformationResources, Inc. (“Information Resources”) has been involved in antitrustlitigation (the “antitrust litigation” or the “litigation”) against The Dun& Bradstreet Corp., A.C. Nielsen Company (now owned by VNU, N.V.) and IMSInternational, Inc. In December 2003, all of the outstanding shares ofInformation Resources common stock were acquired by Gingko Acquisition Corp.pursuant to a tender offer and subsequent merger of Gingko Acquisition Corp.with and into Information Resources. In connection with this acquisition, theInformation Resources, Inc. Litigation Contingent Payment Rights Trust (the “trust”)was created primarily to distribute any proceeds from the litigation receivedby the trust to holders of rights certificates. As part of the mergerconsideration paid by Gingko Acquisition Corp., certain shareholders of commonstock of Information Resources received contingent value rights certificates (“rightscertificates”), which represent undivided beneficial interests in the assets ofthe trust. The rights certificates entitle the holders to a pro rata portion ofany proceeds received by Information Resources in the litigation.

 

Effective as ofFebruary 16, 2006, the parties to the litigation entered into a settlementagreement pursuant to which they agreed to settle all disputes between themarising from the facts and circumstances that were alleged or asserted, orcould have been alleged or asserted, in the litigation in consideration for apayment of $55 million 

 

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by A.C. Nielsen Company toInformation Resources. Payment was made to Information Resources’ counsel, asescrow agent, on February 16, 2006, to be held in an interest-bearingaccount for the benefit of Information Resources pending dismissal of thelitigation by the Second Circuit Court of Appeals. On March 7, 2006, theSecond Circuit Court of Appeals dismissed the litigation with prejudice. (For acomplete description of the litigation and its settlement, see “The Litigation”and “Settlement of the Litigation” below.)

 

Set forth below aredescriptions of: (i) the trust; (ii) the rights certificates and the rights thereunder;(iii) the litigation and settlement thereof; (iv) management of thelitigation; (v) payments made to the trust; (vi) expenses and escrowfund; (vii) material federal income tax consequences;  and (viii) a summary of financialinformation.

 

**Descriptionof the Trust**

The trust is a statutory trust created underDelaware law pursuant to an initial declaration of trust and the filing of acertificate of trust with the Delaware Secretary of State on August 27,2003. The trust was created inconnection with the tender offer by Gingko Acquisition Corp., a wholly-ownedsubsidiary of IRI Holdings, Inc. (formerly known as Gingko Corporation), topurchase all outstanding shares of Information Resources common stock (andassociated preferred share purchase rights) for $3.30 net per share in cash,plus one rights certificate per share, and the subsequentsecond-step merger of Gingko Acquisition Corp. with and into InformationResources pursuant to the Agreement and Plan of Merger dated as ofSeptember 7, 2003, as amended, by and among Information Resources, GingkoCorporation and Gingko Acquisition Corp. The second-step merger wascompleted on December 12, 2003. The Registration Statement on Form S-4with respect to the rights certificates referred to in this document was filedby the trust with, and declared effective by, the SEC on October 30, 2003(SEC File Number 333-108592) (the “Prospectus”).

 

The assets of thetrust consist primarily of the right to receive a portion of any proceedsreceived by Information Resources in any judgment or settlement in thelitigation brought by Information Resources against The Dun &Bradstreet Corp., A.C. Nielsen Company and IMS International, Inc. in theUnited States District Court for the Southern District of New York, entitledInformation Resources, Inc. v. The Dun & Bradstreet Corp., et.al. No. 96 CIV. 5716 (asdescribed below under “The Litigation”).

 

The trust has nobusiness operations. The trust was formed for the sole purpose of:

 

• issuing the rights certificates;

• holding and enforcing the contingent valuerights agreement described below;

• making payments to holders of rightscertificates in respect of proceeds, if any, of the antitrust litigation;

• incurring debt or issuing additional rightscertificates, when permitted; and

• taking actions that are reasonably necessaryand incidental to the foregoing.

 

**Description of Rights Certificates and Rights Thereunder**

An amended and restated declaration of trust, datedas of October 31, 2003 (the “declaration of trust”), governs theadministration of the trust. Becauseof the nature of the trust pursuant to the declaration of trust, there are noemployees, no board of directors, and no board audit committee. The twolitigation trustees (the “litigation trustees”) appointed pursuant to thedeclaration of trust, together with the institutional trustee, Wachovia Bank,N.A., perform certain trust functions under the terms of the declaration oftrust. The litigation trustees are Joseph P. Durrett, former Chief ExecutiveOfficer and Chairman of the Board of Directors of Information Resources, andMonica M. Weed, former General Counsel of Information Resources. The litigationtrustees are not entitled to any compensation for serving as litigationtrustees but the litigation trustees also serve as rights agents and receivecompensation in such capacity (see “—Compensationand Expenses of the Rights Agents” below). The litigation trustees areresponsible for establishing and maintaining disclosure controls and proceduresand internal controls. Under the terms of the contingent value rightsagreement, however, the antitrust litigation is to be directed by a body offive rights agents (the “rights agents”) rather than by the litigation trustees(see “Management of the Litigation” below).

 

The declaration of trust also governs the terms andconditions of the rights certificates. The rights certificates representassignable and transferable undivided beneficial interests in the assets of thetrust. Each rights 

 

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certificate entitles its holder to receive a pro rataportion of any amount received by the trust in respect of litigation proceedsunder the terms of the contingent value rights agreement described below. As aresult of the acquisition by Gingko Acquisition Corp. of all outstanding shares ofInformation Resources common stock, there were 32,259,364 rightscertificates authorized and issuable. At March 31, 2006, 32,138,891 rightscertificates had been issued and were outstanding and 94,243 rightscertificates had not yet been issued as follows:

 
| **RECIPIENTS OF RIGHTS CERTIFICATES**            | ** ** | **NUMBER OF RIGHTS  CERTIFICATES ISSUED** | ** ** |
|-----------------------------------------------------------------|------------|----------------------------------------------------------|------------|
| Information Resources common stockholders                       |       | 30,456,425                                               |       |
|                                                            |       |                                                     |       |
| Information Resources stock option and  restricted stockholders |       | 1,682,466                                                |       |
|                                                            |       |                                                     |       |
| Total Rights Certificates issued                                |       | 32,138,891                                               |       |
|                                                            |       |                                                     |       |
| Untendered Information Resources shares (1)                     |       | 94,243                                                   |       |
|                                                            |       |                                                     |       |
| Total Rights Certificates for Which  Distribution Will be Made  |       | 32,233,134                                               |       |

 

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(1)           At March 31, 2006, the records of thetransfer agent for Information Resources indicate that 94,243 shares ofInformation Resources stock have not yet been properly tendered in accordancewith the terms of the merger agreement. If and when such shares areproperly and timely tendered in accordance with the terms of the mergeragreement, the holdersof record of those shares will be entitled to receive the mergerconsideration of $3.30 in cash plus one rights certificate per share tenderedor, if the appropriate tender documentation is timely received afterdistribution of the litigation proceeds is made to the rights holders, theholder of record of such shares will be entitled to receive the per rightscertificate payment amount in lieu of a rights certificate for each sharetendered. The trust will pay to Information Resources the appropriate amountper rights certificate for each Information Resources share still outstandingon the records of the transfer agent on the date of distribution to all rightscertificate holders, to be held by Information Resources in a segregatedaccount for payment in accordance with the terms of the merger agreement.

 

The rights certificates are freely transferable bythe holders of the rights certificates under the Securities Act of 1933 (the “SecuritiesAct”) and under the terms of the declaration of trust, except for the followingrestrictions:

 

• holders of rights certificates who maybe deemed to be “affiliates” of the trust for purposes of Rule 145 underthe Securities Act as of the date of receipt may not sell their rightscertificates, except pursuant to an effective registration statement under theSecurities Act or an applicable exemption from the registration requirements ofthe Securities Act;

• none of IRI Holdings, Inc., itssuccessors, or any of their respective subsidiaries or affiliates may, as aresult of that transfer, individually or collectively obtain beneficialownership (as defined by Rule 13d-3 under the Exchange Act of 1934) of 15%or more of the rights certificates then outstanding; and

• no transfer of a rights certificatemay be made to any defendant adverse to Information Resources in the antitrustlitigation or to any affiliate, associate or agent of that defendant.

 

An amended contingent value rights agreement, datedas of October 31, 2003 (the “contingent value rights agreement”) governsthe terms of management of the antitrust litigation and the obligations of IRIHoldings, Inc. to make cash payments to the trust in respect of proceedsreceived in the antitrust litigation. Pursuant to the terms of the contingentvalue rights agreement, the trust will be entitled to be paid by IRI Holdings,Inc. an amount equal to 68% of any proceeds received by Information Resourcesin respect of the antitrust litigation (whether by settlement, judgment orotherwise), to the extent such proceeds are equal to or less than$200 million, and 75% of any such proceeds in excess of $200 million,in each case subject to adjustments described for certain items, including fortaxes that Information Resources will be required to pay on the recovery(assumed to be at a rate of 34%) and any contingency-based fees payable tooutside counsel in connection with the antitrust litigation. The remaining 32%of any such proceeds, to the extent such proceeds are equal to or less than$200 million, and 25%

 

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of any such proceeds in excess of $200 million(again, in each case, subject to certain adjustments described in theProspectus) will be retained and remain the property of Information Resourcesand its then-current owners.  (See “PaymentsMade to the Trust” below.)

 

**The Litigation**

 

The following description of the antitrust litigationhas been obtained from publicly available documents filed with the Securitiesand Exchange Commission by Information Resources, as updated from time to timein publicly available documents filed with the Securities and ExchangeCommission by the trust. It does not purport to be a full or completedescription of the legal or factual issues presented, the court opinionsrendered or the relevant law.

 

GENERAL. OnJuly 27, 1996, Information Resources filed an antitrust lawsuit againstThe Dun & Bradstreet Corp., A.C. Nielsen Company and IMSInternational, Inc. in the United States District Court for the SouthernDistrict of New York entitled Information Resources, Inc. v. TheDun & Bradstreet Corp., et al. No. 96 CIV. 5716. In the lawsuit,Information Resources alleged that the defendants violated Sections 1 and2 of the Sherman Act, 15 U.S.C. Sections 1 and 2, and the common law byengaging in a series of unlawful practices through which InformationResources claimed that defendants attempted to regain monopoly power in theU.S. market for retail tracking services and exclude competition from 30markets outside the U.S., where Nielsen dominated. Through the antitrustlitigation, Information Resources sought to enjoin those practices and torecover damages in excess of $650 million, before trebling. InformationResources demanded a trial by jury, and the case was assigned to the HonorableLouis L. Stanton. It was Information Resources’ position that it continuedto suffer damages to the present time as a result of the defendants’ allegedlyunlawful practices, which it believed were aimed at undermining competition byfinancially crippling Information Resources.

 

DEFENDANTS’PRACTICES. Information Resources asserted that, for over 60 years, Nielsenhad dominated the markets for retail tracking services, both within and outsidethe U.S., through its manual, audit-based services. In 1986, InformationResources introduced its retail tracking service known as “InfoScan,” the world’sfirst national retail tracking service based on scanner data. InformationResources alleged that, due to the success of the InfoScan service, by 1992Information Resources had gained a significant share of the U.S. market. At thesame time, Information Resources began to undertake efforts to expand andexport its services to new geographic markets in Western Europe and Canada,where, Information Resources asserted, Nielsen continued to exercise monopolypower.

 

InformationResources claimed that, faced with a threat to Nielsen’s foreign monopolies andthe loss of market share in the U.S., defendants developed and implemented aplan to undermine Information Resources’ ability to compete both within theU.S. and abroad. To accomplish this objective, Information Resources allegedthat the defendants in the antitrust litigation engaged in the followingcoordinated anticompetitive practices, among others:

 

•    unlawfully tying/bundling services inmarkets in which defendants had monopoly power with services in markets inwhich Nielsen competed with Information Resources;

•    entering into exclusionary contracts withretailers in several countries in order to deny Information Resources’ accessto the sales data necessary to provide retail tracking services or toartificially raise the cost of that data;

•    predatory pricing;

•    acquiring foreign market competitors withthe intent of impeding Information Resources’ efforts at geographic expansion;

•    tortiously interfering with InformationResources’ contracts and relationships with clients, joint venture partners andother market research companies;

•    disparaging Information Resources to financialanalysts and clients; and

•    denying Information Resources access to thecapital markets necessary for it to compete.

 

THE GOVERNMENTINVESTIGATIONS. When the defendants in the antitrust litigation refused to endthese practices, Information Resources alerted antitrust regulatory authoritiesin Canada, the United States and Europe. First, Information Resourcescomplained to the Canadian Director of Investigation and Research concerning

 

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exclusive datacontracts with retailers and long-term contracts with manufacturers thatNielsen had executed in Canada. Information Resources claimed that thosecontracts prevented Information Resources’ entry into the Canadian market. TheCanadian Director of Investigation and Research conducted an investigation andthereafter filed an application on April 5, 1994 against Nielsen’spractices before the Canadian Competition Tribunal. On August 30, 1995,the Canadian Competition Tribunal issued an order concluding that Nielsen, thesole supplier of retail tracking services in Canada, had unlawfully excludedInformation Resources from the market. The Canadian Competition Tribunalordered that Nielsen could not enforce any of the provisions of its contractswith retailers or manufacturers that the tribunal had concluded wereanticompetitive.

 

InformationResources also complained to the United States Department of Justice-AntitrustDivision in July 1994 and to the European Commission-Directorate GeneralIV in September 1994, concerning the defendants’ bundling practices withmultinational manufacturers and allegedly exclusionary data contracts withretailers in Europe. The Department of Justice and the European Commissionentered into a cooperation agreement, with the European Commission ultimatelytaking primary responsibility for the investigation. On May 7, 1996,following an 18-month investigation, the European Commission initiated formalproceedings against Nielsen, the dominant provider of retail tracking servicesin Europe, and adopted a statement of objections. The European Commission foundthat Nielsen had engaged in abusive practices to exclude Information Resourcesfrom European markets for retail tracking services. On November 28, 1996,Nielsen entered into a formal undertaking with the European Commission in whichit agreed to abandon all of the abusive practices found by the Commission.Because Nielsen entered into the undertaking, the Department of Justice closedits investigation.

 

U.S. LEGAL PROCEEDINGS. On July 27,1996, Information Resources filed its complaint, which asserted the followingclaims: Sherman Act Section 1 Violation-Per Se Tying (Count I);Sherman Act Section 1 Violation-Unreasonable Restraints of Trade(Count II); Sherman Act Section 2 Violation-Monopolization of theExport Markets (Count III); Sherman Act Section 2 Violation-Attemptto Monopolize the Export Markets (Count IV); Sherman Act Section 2Violation-Attempt to Monopolize the United States Market (Count V);Sherman Act Section 2 Violation-Monopoly Leveraging (Count VI);Tortious Interference with Contract (Count VII); Tortious Interferencewith Prospective Business Relationship (Count VIII).

 

On December 3, 2004, theU.S. District Court presiding over the litigation granted defendants’ motion inlimine, holding that Information Resources was barred from arguing thatNielsen’s pricing practices or discounts, including its bundling practices,were illegal or anti-competitive unless it could prove that they involvedprices below short-run average variable costs, calculated without the inclusionof Nielsen’s fixed operations costs. On January 27, 2005, the court issueda stipulated order dismissing all of Information Resources’ remaining claimswith prejudice and on the merits for the purpose of allowing InformationResources to take an immediate appeal. At this time, the court also entered afinal judgment against Information Resources. Information Resources stipulatedto the court’s order and to a final judgment being entered against it becauseit could not meet the standard that the court set forth in its December 3,2004 inlimine order (as summarized in the first sentence of thisparagraph above). While Information Resources believed that such standard waserroneous, it determined that it could not prove its remaining claims withoutthe critical evidence of Nielsen’s bundled contracts that was excluded by the inlimine ruling.

 

Effective February 1,2005, Information Resources filed a Notice of Appeal with the United StatesCourt of Appeals for the Second Circuit appealing the final judgment enteredagainst it on January 27, 2005, as well as the earlier rulings pursuant towhich the court denied Information Resources and/or its subsidiaries the rightto sue under the Sherman Act for damages suffered in those European marketswhere Information Resources sold its InfoScan services through itssubsidiaries. On April 15, 2005, Information Resources, as appellant,filed its brief in the Second Circuit Court of Appeals. Appellees filed theirresponsive brief on May 16, 2005. Information Resources then filed itsreply brief on June 7, 2005. The Second Circuit Court of Appeals heardoral argument on this appeal on October 18, 2005. All briefs filed in thiscase with the Second Circuit Court of Appeals are a matter of public record andshould be available for viewing in the clerk’s office of the Second CircuitCourt of Appeals. Hagens Berman, Information Resources’ lead trial counsel inthis case, has also posted Information Resources’ April 15, 2005 appellatebrief, appellees’ May 16, 2005 responsive brief and Information Resources’June 7, 2005 reply brief on its website at www.hbsslaw.com. All othermaterials filed with the Second Circuit Court of Appeals in this case, ifpublicly available, should be obtained directly from the clerk’s office of the

 

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Second Circuit Court ofAppeals.

 

DAMAGES. Inits original complaint, filed in 1996, Information Resources sought damages inexcess of $350 million before trebling. On February 27, 2004, InformationResources filed the expert report of Professor Fisher. In that report,Professor Fisher opined that Information Resources had suffered damages ofbetween $545.4 million and $615.5 million (prior to trebling) in the U.S.market, as a result of defendants’ practices that Professor Fisher hadconcluded were anticompetitive and through which Professor Fisher concludeddefendants sought to monopolize the U.S. market. He also opined thatInformation Resources suffered damages of $21.0 million in Canada and $15.2million in Mexico, as a result of practices that Professor Fisher had concludedwere anticompetitive and excluded Information Resources from these markets.

 

COUNSEL TO INFORMATION RESOURCES. InformationResources was represented in the antitrust litigation by the following lawfirms: Freeborn & Peters LLP; Hagens Berman Sobol Shapiro LLP; andFried, Frank, Harris, Schriver & Jacobson LLP.

 

**Settlement of the Litigation**

 

OnFebruary 16, 2006, Information Resources and the trust announced thatInformation Resources and the defendants in the litigation had entered into asettlement agreement, effective as of February 16, 2006, pursuant to whichthey agreed to settle all disputes between them arising from the facts and circumstancesthat were alleged or asserted, or could have been alleged or asserted, in thelitigation in consideration for a payment of $55 million by A.C. NielsenCompany to Information Resources. Payment of $55 million was made toInformation Resources’ counsel, Hagens Berman Sobol Shapiro LLP, as escrowagent, on February 16, 2006, to be held by Hagens Berman in aninterest-bearing account for the benefit of Information Resources pendingdismissal of the litigation by the Second Circuit Court of Appeals. The trustfiled a copy of the settlement agreement with the SEC on Form 8-K onFebruary 21, 2006.

 

OnMarch 7, 2006, the Second Circuit Court of Appeals dismissed thelitigation with prejudice. On March 20, 2006, Hagens Berman transferredthe settlement amount of $55 million, plus $190,838 of interest accruedthereon, to IRI Holdings, Inc., to be held by IRI Holdings, Inc. in asegregated account pending final determination of the amounts owed to thetrust. On March 22, 2006, IRI Holdings, Inc. transferred the amountof $19,875,965 to the trust and on March 23, 2006, Information Resourcestransferred the amount of $2,738,003 to the trust, which amounts, takentogether, represent the initial installment of the “CVR Payment Amount” due tothe trust in accordance with the terms of the contingent value rightsagreement. (For more information regarding the CVR Payment Amount, see “PaymentsMade to the Trust” below.)

 

In considering the possibilityof settling the litigation, the rights agents (as defined in “Management of theLitigation” below) asked each of its litigation teams at Hagens Berman andFreeborn & Peters to provide the rights agents with an independentassessment of the strengths and weaknesses of the litigation, both on appealand at trial if Information Resources were to prevail at the Second Circuit.Chief among the factors considered by the rights agents in deciding to settlethe litigation were the following risks raised by litigation counsel in theirassessments:

 

•      While both litigation teams continued tobelieve that Information Resources’ position on bundling was the correctposition, they both believed that it was more likely than not that InformationResources would have lost on this issue before the Second Circuit Court ofAppeals due to a number of factors, including the uncertainty and lack ofsettled law regarding bundling, a preliminary article recently publishedby a noted antitrust scholar recommending that the courts take a position onbundling that was adverse to Information Resources’ position on appeal andrecent economic literature criticizing the case on which Information Resourcesmost strongly relied as support for its bundling position;

•      Even if Information Resources were toprevail at the Second Circuit on the bundling issue, both litigation teams feltthere was a significant risk that the Supreme Court would rule againstInformation Resources if it accepted the case for appeal, particularly in lightof the current make-up of the Supreme Court and the fact that Justice Alito, thenewest addition to the Supreme Court, was the author of an appellate courtdecision in 2002 that was adverse to Information Resources’ bundling positionin this case. Although Justice Alito’s position was overturned on enbancreview by the Third Circuit Court of Appeals in 2003, Justice Alito 

 

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recently expressed his opinion that his original view of that case wascorrect;

•      If Information Resources were to prevailat the Second Circuit and Information Resources’ case were remanded to thedistrict court for trial, Information Resources’ litigation teams were bothconcerned about the possibility of further adverse rulings at the districtcourt level on several significant issues that could have materially impactedInformation Resources’ case at trial; and

•      If Information Resources were to prevailbefore both the Second Circuit and the Supreme Court, and ultimately were toprevail at trial, both litigation teams advised that it was likely to beseveral years before Information Resources would have been able to collect onits judgment due to post-trial motions and appeals.

 

At the request of the rightsagents, each litigation team also provided its independent view of a fairsettlement value in light of the strengths and weaknesses it identified. Toensure an unbiased view, the rights agents did not share with the litigationteams any information about the settlement negotiations until after thelitigation teams presented their assessments and settlement valuations to therights agents. The ultimate offer unanimously accepted by the rights agents waswithin the settlement range recommended by each litigation team.

 

While the rights agents reliedheavily on the opinions of their litigation counsel, they also considered thecurrent market price of the rights certificates. On February 15, 2006, theday before settlement, the closing price was $0.69 per rights certificate. Forthe 90 trading day period prior to the date of settlement, the average closingprice per rights certificate was $0.425. This compares to the currentlyexpected rights certificate distribution of between $0.69 and $.70 per rightscertificate. Once the final calculations are made, the actual payments made torights certificate holders may vary from the range set forth above. Thetrust is expected to make a final determination of the amount due to the rightscertificate holders and begin the final distribution process to the rightscertificate holders on or before May 19, 2006.

 

Although the rights agentscontinue to believe in the merits of Information Resources’ case, in light ofthe circumstances facing the rights agents at the time of settlement and thehigh degree of uncertainty in the law on the issues then on appeal before theSecond Circuit in the case, the rights agents unanimously concluded that thesettlement offer made by the defendants was a fair result for the rightscertificate holders.

 

**Management of theLitigation**

 

GENERAL. Under the terms of the contingent value rights agreement, theantitrust litigation is to be directed on behalf of Information Resources andthe rights certificates holders by a body of five rights agents: two CVR RightsAgents, two Parent Rights Agents and one Independent Rights Agent.Under the contingent value rights agreement, the CVR Rights Agents areresponsible for overseeing the day-to-day workings of the antitrust litigation.However, the approval of a majority of the rights agents is required forcertain strategic decisions relating to the antitrust litigation. Further, amajority of the rights agents (other than the Independent Rights Agent) mustapprove any settlement of the litigation.

 

The current CVR Rights Agents are Joseph P. Durrett, former ChiefExecutive Officer and Chairman of the Board of Directors of InformationResources, and Monica M. Weed, former General Counsel of Information Resources.The current Parent Rights Agents are William Chisholm, Executive Vice Presidentand a member of the Board of Directors of IRI Holdings, Inc., and MichaelDuffey, current Chief Financial Officer of Information Resources. The formerIndependent Rights Agent, Travis Rhodes, investment analyst at Abrams CapitalLLC, resigned effective as of August 15, 2005 in order to devote greaterattention to his primary responsibilities at Abrams Capital. Mr. Rhodes’decision to resign was not a result of any disagreement with the trust, theLitigation Trustees or the other Rights Agents, nor was it the result of anymatter relating to the antitrust litigation or the trust’s operations, policiesor procedures. At the time of settlement of the litigation, the other RightsAgents were in the process of identifying qualified candidates to replaceMr. Rhodes as the Independent Rights Agent. As a result of the settlementof the litigation, the Rights Agents have determined that there is no longer aneed to appoint a replacement Independent Rights Agent.

 

As of April 17, 2006, Mr. Durrett was the beneficial owner of323,536 rights certificates and Ms. Weed was the beneficial holder of47,736 rights certificates. None of IRI Holdings, Inc., InformationResources, Mr. Chisholm or Mr. Duffey was a beneficial owner ofrights certificates as of April 17, 2006.

 

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On March 6, 2004, the rights agents engagedMonica M. Weed, former General Counsel of Information Resources, to assist themin the day-to-day management of the antitrust litigation and toperform such other duties as the rights agents may delegate toMs. Weed from time to time. Ms. Weed has in-depth and specificknowledge of the facts underlying the litigation and, as General Counsel ofInformation Resources, was responsible for managing the day-to-day matters inthe antitrust litigation from 1998 through the effective date of the contingentvalue rights agreement, when the CVR Rights Agents took over day-to-daymanagement responsibility for the antitrust litigation. Ms. Weed iscompensated at the rate of $350 per hour, plus reimbursement of her reasonableout-of-pocket expenses. As of April 1, 2004, when Ms. Weed beganreceiving $5,000 per month as compensation for serving as a CVR Rights Agent(see “—Compensation and Expenses of Rights Agents” below), she began providingservices to the rights agents at no additional charge for the first $5,000 ofservices rendered each month.

 

COMPENSATION AND EXPENSES OF RIGHTS AGENTS.Beginning December 2003, the CVR Rights Agents are to bepaid at least $5,000 per month on the first day of each month until the lastrights certificate payment date, and the Independent Rights Agent may bepaid a fair and reasonable amount of compensation until the last payment datethat is agreed to by a majority of the rights agents (other than theIndependent Rights Agent). These payments are payable as claims expenses (see “—Fundingof Claims Expenses”). Generally, all reasonable expenses and disbursementsincurred by the rights agents in connection with the discharge of their dutieswill also be payable by Information Resources as claims expenses. The ParentRights Agents are not entitled to any compensation for their service as ParentRights Agents. As of March 31, 2006, the total amount of $30,000 wasincurred as compensation payments to the CVR Rights Agents for the three monthsof 2006.

 

LIABILITY ANDINDEMNIFICATION OF RIGHTS AGENTS. The rights agents will not be liable for anyacts or omissions except to the extent that the rights agents have engaged inwillful misconduct or bad faith. The rights agents will be indemnified and heldharmless from and against any and all liabilities, obligations, losses,damages, penalties, actions, judgments, suits, costs, reasonable expenses andreasonable disbursements of any kind or nature whatsoever (including for theirown ordinary or gross negligence) that may be imposed on, asserted againstor incurred by them under the contingent value rights agreement. The rightsagents will not have the right to be indemnified under the contingent valuerights agreement for their own willful misconduct or bad faith.

 

REMOVAL ANDAPPOINTMENT OF RIGHTS AGENTS. The rights agents may resign at any time bygiving written notice of resignation to IRI Holdings, Inc., the trust andthe other rights agents. Any Parent Rights Agent may be removed by IRIHoldings, Inc. at any time and all of the rights agents (other than theIndependent Rights Agent) may remove the Independent Rights Agent at anytime. A CVR Rights Agent may not be removed by any party. If a ParentRights Agent resigns, is removed or becomes incapable of acting, IRI Holdings, Inc.will promptly appoint a qualified successor Parent Rights Agent, whichmay be an officer of IRI Holdings, Inc. If a CVR Rights Agentresigns, is removed, or becomes incapable of acting, the remaining CVR RightsAgent will promptly appoint a qualified successor who is a rights certificateholder. If the Independent Rights Agent resigns, is removed or becomesincapable of acting, his or her successor will be appointed by the unanimousagreement of the remaining rights agents. Additional mechanisms are in place ifa successor CVR Rights Agent is not chosen as set forth above.

 

**Payments Made To the Trust**

 

APPROVAL PROCESS FOR PAYMENTS MADE TO THE TRUST. Inaccordance with the terms of the contingent value rights agreement, the rightsagents delivered to IRI Holdings, Inc. a certificate (a “litigationproceeds certificate”), dated as of March 17, 2006, setting forth, amongother things:

 

• the amount of the cash proceedsreceived as a result of settlement, including interest accrued thereon;

• an itemized list of the claimsexpenses (as defined below) (a) incurred and invoiced as of March 15,2006; and (b) expected to be incurred or invoiced from March 16, 2006through the cancellation of the trust;

• an itemized list of expenses of thetrust (a) incurred by Information Resources (directly or by reimbursement)and invoiced as of March 15, 2006 to permit the trust to comply withsecurities laws or the rules of the OTC Bulletin Board (as described belowunder “—Expenses of the Trust”) or in

 

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connectionwith the registration of the rights certificates under the Securities Act and(b) additional expenses of the trust expected to be incurred or invoicedfrom March 16, 2006 through the cancellation of the trust;

• the portion of the funds to beretained in escrow to pay for expected claims expenses and expenses of thetrust to the extent the expenses of the trust exceed the amount withheld byInformation Resources from litigation proceeds to pay these expenses; and

• the calculation of the initial amountsto be paid to the trust with respect to the litigation proceeds received (the “rightscertificate payment amount”) and the escrow account balance.

 

The amountsset forth in the litigation proceeds certificate, absent mathematical error,are binding on IRI Holdings, Inc. and the trust. IRI Holdings, Inc.computed the rights certificate payment amount in a manner consistent with thelitigation proceeds certificate and paid to the trust the amount of $19,875,965as specified in the litigation proceeds certificate on March 22, 2006. IRIHoldings, Inc. withheld the amount of $280,992 from the rights certificatepayment amount due to the trust to pay for certain future expected expenses ofthe trust. To the extent the actual expenses of the trust are less than theamount withheld by IRI Holdings, Inc. to pay these expenses, IRIHoldings, Inc. will transfer the excess, plus interest accrued thereon, tothe trust prior to distribution to the rights certificate holders. On March 23,2006, Information Resources transferred the amount of $2,738,003 to the trustfrom the escrow account established to pay claims expenses. InformationResources retained in the escrow account the amount of $200,000, plus interestearned on the escrow account from February 1, 2006, to pay for future expectedclaims expenses, as well as certain future expenses of the trust to the extentthe expenses of the trust exceed the amount withheld by IRI Holdings from therights certificate payment amount to pay for these expenses as set forthabove.  After all expenses have been paidin full, any balance remaining in the escrow account, plus interest accruedthereon, will be transferred to the trust immediately prior to distribution tothe rights certificate holders. See “Payment Calculation” below setting forththe exact calculation of this rights certificate payment amount.

 

PAYMENT CALCULATION. The rights certificate paymentamount paid to the trust in two installments on March 22 andMarch 23, 2006 was calculated using the following methodology:

 

• First, by calculating the “basepreliminary rights certificate payment amount,” which equals (x) the “baserights certificate percentage” (generally 68%, and adjusted as described below)*times* the amount of gross litigation proceeds(as defined below) actually received by Information Resources and itssubsidiaries or their affiliates through the date of the litigation proceedscertificate applicable to such rights certificate payment date *minus* (y) the base rights certificate percentage *times* the assumed tax liability with respect the grosslitigation proceeds actually received through the date of the litigationproceeds certificate applicable to that rights certificate payment date *minus* (z) (I) the base rights certificate percentage *times* (II) one *minus* theassumed tax rate *times* (III) the amount ofcontingency-based fees that are calculated on the gross litigation proceeds.However, the base preliminary rights certificate payment amount for the lastrights certificate payment date will be increased by the amount by which theclaims expenses (as defined below) are less than the $10 million (plus theinterest earned on this amount) retained in the escrow fund.

• Second, by calculating the “rightscertificate payment amount,” which, in this case, equals the base preliminaryrights certificate payment amount; *provided*thatthe rights certificate payment amount will be adjusted as described in the nextparagraph.

 

The rights certificate payment amount for any rightscertificate payment date will be reduced by the product of (A) one *minus* the assumed tax rate *times*(B) the sum of the following expenses (collectively, the “deductibleexpenses”):

 

• the aggregate amount of expenses as ofthe rights certificate payment date (and not previously included in thecomputation of a rights certificate payment amount) that Information Resourceshas incurred (directly or by reimbursement) to permit the trust to comply withsecurities laws or the rules of the OTC Bulletin Board (as described belowunder “—Expenses of the Trust”) or in connection with the registration of therights certificates under the Securities Act; *plus*

• the aggregate amount of expenses as ofthe rights certificate payment date (and not previously included in thecomputation of a rights certificate payment amount) incurred pursuant toInformation Resources’

 

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obligation toobtain liability insurance for the benefit of the rights agents and to coverthe trust’s indemnification obligations, or in order to obtain and maintaindirectors’ and officers’ insurance for IRI Holdings, Inc., InformationResources and their subsidiaries, but in each case only the aggregate amount inexcess of the aggregate amount that would have been paid if the rightscertificates were non-transferable contractual rights rather than publiclytraded, registered securities (which amounts shall be determined by decision ofa majority of the rights agents or, if there are fewer than five rights agents,by unanimous approval of the rights agents).

 

Using the foregoing methodology, the exactcalculation of the rights certificate payment amount received by the trust intwo installments on March 22 and March 23, 2006 is as follows:

 
| **Gross Litigation Proceeds**                                                                          |       |       |       | $              | 55,000,000 |   |
|--------------------------------------------------------------------------------------------------------|------------|------------|------------|----------------|------------|--------|
| Interest through March 21, 2006                                                                        | ** ** | ** ** | ** ** | 203,675        | ** ** |
|                                                                                                   |       |       |       |           |       |
| **Contingent Attorneys Fees:**                                                                         |       |       |       |           |       |
| Hagens Berman Sobol Shapiro                                                                            |       | (2,570,544 | )          |           |       |
| Freeborn & Peters                                                                             |       | (4,700,000 | )          |           |       |
| Boies, Schiller & Flexner                                                                     |       | (2,700,000 | )          |           |       |
|                                                                                                   |       | (9,970,544 | )          | (9,970,544     | )          |
|                                                                                                   |       |       |       |           |       |
| **Litigation Proceeds**                                                                                |       |       |       | 45,233,131     |       |
| Applicable Percentage                                                                                  |       |       |       | 68             | %          |
| Preliminary Pre-Tax Amount                                                                             |       |       |       | 30,758,529     |       |
| Assumed Tax Cost (34%)                                                                                 |       |       |       | (10,457,900    | )          |
|                                                                                                   |       |       |       |           |       |
| **Preliminary Payment Amount**                                                                         |       |       |       | 20,300,629     |       |
|                                                                                                   |       |       |       |           |       |
| **Less, Public Company Deductible Expenses:**                                                          |       |       |       |           |       |
| Incurred and Invoiced as of March 15,  2006                                                       |       | (362,439   | )          |           |       |
| Expected to be Incurred or Invoiced from  March 16, 2006 to Cancellation of Trust                 |       | (280,992   | )          |           |       |
|                                                                                                   |       | (643,431   | )          |           |       |
| Assumed Tax Benefit (34%)                                                                              |       | 218,767    |       |           |       |
| Public Company Deductible Expenses, net of  assumed tax benefit                                        |       | (424,664   | )          | (424,664       | )          |
| **Payment of Litigation Proceeds Made to Trust  on March 22, 2006**                                    | ** ** | ** ** | ** ** | **19,875,965** | ** ** |
| **Add Escrow Balance:**                                                                                |       |       |       |           |       |
| Original Balance                                                                                       |       | 10,000,000 |       |           |       |
| Interest through January 31, 2006                                                                      |       | 172,573    |       |           |       |
| Less, Claims Expenses:                                                                                 |       |       |       |           |       |
| Incurred and Invoiced through  March 15, 2006                                                     |       | (7,234,570 | )          | ** **     |       |
| Claims Expenses Expected to be Incurred or  Invoiced from March 16, 2006 to Cancellation of Trust |       | (200,000   | )          | ** **     |       |
| Balance Transferred to Trust on  March 23, 2006                                                   |       | 2,738,003  |       | 2,738,003      |       |
| Total Payments to Trust on March 22  and 23, 2006                                                 | ** ** | ** ** |       | $              | 22,613,968 |   |

 

For purposes of the foregoing, the term “grosslitigation proceeds” means the sum of (x) any and all cash proceedsrecovered or received by Information Resources, its subsidiaries or theiraffiliates as a result of the litigation (including compensation, damages,penalties and other payments), *plus*(y) the fair market value of any and all non-cash proceeds recovered orreceived by Information Resources, its subsidiaries or their affiliates as aresult of the litigation (including agreements, commitments, undertakings andother benefits and protections). The term “litigation proceeds” means grosslitigation proceeds less any contingency-based fees. Any non-cash proceeds thatprovide Information Resources, its subsidiaries and their affiliates with nosubstantial benefits or protections other than those to which they are entitledunder applicable law are deemed to have a fair market

 

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value of zero under the agreement. There were nonon-cash proceeds received as part of the settlement of the litigation.

 

PAYMENT PROCEDURES TO HOLDERS OF RIGHTSCERTIFICATES.****The trust expects to make asingle payment to the holders of rights certificates as follows: Upon thereceipt of all amounts to be paid to the rights certificate holders from IRIHoldings, Inc. and Information Resources pursuant to the contingent valuerights agreement, the institutional trustee of the trust will transfer theaggregate rights certificate payment amount to the payment agent designatedpursuant to the declaration of trust. No later than May 19, 2006,  the paying agent will send a form letterof transmittal to each rights certificate holder of record with instructionsfor completion and submission of payment documentation to the paying agent. Thedistribution date for payment to the rights certificateholders is currectlyexpected to be June 15, 2006. Beginning June 15, 2006, upon receipt by thepaying agent of proper payment documentation from a rights certificate holderof record, the paying agent will promptly make the appropriate payment to theholder. For those holders of Information Resources stock who have not yettendered their shares for the merger consideration, the trust will provide toInformation Resources an amount equal to the per rights certificate paymentamount for each such Information Resources share not yet tendered. InformationResources will retain this amount in a segregated account for payment inaccordance with the terms of the merger agreement.

 

To the extent there is a residual amount remainingin the trust after payments are made as set forth above, and such residualamount is less than the expected costs to make a subsequent payment to therights certificate holders, the rights agents and litigation trustees haveagreed that such amount will be contributed to a national charitableorganization selected by the rights agents.

 

**Expenses; Escrow Fund**

 

FUNDING OF CLAIMS EXPENSES.****Claimsexpenses (as defined below) are generally incurred and paid by InformationResources and are then reimbursed to Information Resources out of the escrowaccount referred to in the next paragraph. (See Part I, Item 2 below —Summary Financial Information.) As used herein, the term “claims expenses”means the sum of all direct expenses incurred after the date of the mergeragreement by IRI Holdings, Inc., Information Resources, InformationResources’ subsidiaries, and their affiliates to prosecute the antitrustlitigation, (i) generally including any amounts paid to or on behalf ofthe rights agents but (ii) excluding (A) contingency-based fees,(B) any payment of the independent accounting firm costs and expenses,(C) any fees, expenses or costs associated with the trust and (D) anyfees, expenses or costs associated with registering the rights certificatesunder the Securities Act or any fees, expenses or costs associated withcomplying with the Securities Act, the Securities Exchange Act of 1934 andother securities laws.

 

ESCROW FUND. Pursuant to the contingent value rightsagreement, on December 12, 2003 IRI Holdings, Inc. placed the cashamount of $10 million, plus interest in the amount of $45,548, in anescrow account held by LaSalle Bank National Association as escrow agent, freeof any liens or encumbrances of any kind (except as permitted in the contingentvalue rights agreement), to support the prosecution of the antitrust litigationand the payment of claims expenses. The escrow account is in the name ofInformation Resources but is restricted in use to funding claims expenses forthe antitrust litigation. As of March 31, 2006, the escrow account balance was$270,967.

 

As of April 17, 2006,Information Resources has been reimbursed out of the escrow fund for certainclaims expenses it has paid, and certain third party providers have been paiddirectly out of the escrow fund for other claims expenses, in the total amountof $7,172,594. Information Resources has paid an additional amount of $68,543 forclaims expenses for which Information Resources will be entitled toreimbursement out of the escrow fund upon presentation of a claims notice tothe escrow agent. Information Resources has also received invoices for claimsexpenses in the amount of $3,436 that remain unpaid as of April 17, 2006.  As part of the settlement, $2,738,003 wasalso distributed from the escrow fund to the trust.  After disbursement of the foregoing amountsout of the escrow fund, the balance remaining in the escrow fund, including allinterest earned on the balance as of March 31, 2006, will be $198,988.

 

CONTINGENCY FEE ARRANGEMENTS.On September 17, 2002, Information Resources entered into a partialcontingency fee arrangement with Freeborn & Peters LLP, one of the lawfirms representing it in the antitrust litigation. In May of 2004,Information Resources also entered into full contingency fee arrangements

 

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with Hagens Berman SobolShapiro LLP, the lead trial counsel in the antitrust litigation, and Boies,Schiller & Flexner LLP, the former lead trial counsel in the antitrustlitigation.

 

Under the partial contingencyfee arrangement with Freeborn & Peters, Information Resources wasobligated to pay all legal fees Information Resources incurred for servicesprovided by Freeborn & Peters below a specific monthly cap, togetherwith all expenses incurred by Freeborn & Peters in connection with theantitrust litigation. Additionally, Information Resources agreed that, if itsettled the case after the trial commenced or obtained a verdict in its favor,it would pay Freeborn & Peters an amount equal to the greater of(i) 5% of the value of what Information Resources recovered from thedefendants as a result of a judgment rendered against or a settlement withthem, or (ii) the difference between the actual fees paid by InformationResources to Freeborn & Peters in connection with the litigation andthe fees that Information Resources would have incurred had it continued payingFreeborn & Peters for services rendered for the period January 1,2002 through the trial of the litigation at that firm’s standard rates. If thelitigation were settled and dismissed before the beginning of a trial on itsmerits, Information Resources would instead pay Freeborn & Peters$2.5 million as a contingency fee. Separate from the contingency feearrangement, Information Resources also agreed to reimburse Freeborn &Peters for all discounts received by Information Resources on legal feesincurred in connection with the litigation and related matters through(i) the period ending December 31, 2001 if Information Resourcessettled or obtained a verdict in its favor after the trial commenced, or(ii) the date of settlement if a settlement occurred before the trialcommenced. On February 15, 2006, the rights agents and Freeborn &Peters agreed that Information Resources would pay Freeborn & Peters atotal of $4.7 million in full satisfaction of its obligations under the partialcontingency fee arrangement between the parties and its obligation to reimburseFreeborn & Peters for discounts received on legal fees incurred inconnection with the litigation and related matters through the date ofsettlement. Information Resources paid Freeborn & Peters this amountin full on March 22, 2006.

 

Under the full contingency feearrangement with Hagens Berman Sobol Shapiro LLP, Hagens Berman agreed torepresent Information Resources through the trial in the litigation, as well asthrough any appeals or any retrial, in consideration for a contingency fee tobe calculated as follows: If the litigation were settled before a jury wassworn in, Information Resources would pay Hagens Berman a contingency fee equalto the sum of 6% of the first $100 million of any recovery, 5% of the second$100 million of any recovery, 4% of the third $100 million of any recovery and3% of the amount of any recovery in excess of $300 million. If InformationResources settled the case after a jury was sworn in or obtained a verdict inits favor, Information Resources would instead pay Hagens Berman a contingencyfee equal to 8% of any recovery. As part of this contingency feearrangement, Information Resources was responsible for paying all expensesincurred by Hagens Berman and Information Resources to prosecute the litigationin accordance with a mutually agreed upon budget. Any expenses incurred inexcess of the budget would be advanced by Hagens Berman, to be reimbursed to itout of any balance in the escrow fund referred to above upon mutually agreed uponterms. Substantially all costs (excluding legal fees for counsel representingInformation Resources in the litigation) paid directly or reimbursed byInformation Resources or out of the escrow fund since the inception of the casewould be deducted from any recovery before calculating Hagens Berman’scontingency fee. No contingency fee was to be paid to Hagens Berman on theaward by a court of fees, costs or interest. The applicable costs to bededucted from the total settlement amount, as set forth above, to calculateHagens Berman’s fee were $12,157,596. On March 20, 2006, InformationResources paid Hagens Berman a contingency fee of $2,570,544, calculated as 6%of $42,842,404 ($55 million less $12,157,596 of costs).

 

Under the contingency feearrangement with Boies, Schiller & Flexner LLP, Boies,Schiller & Flexner was paid $250,000 in June 2004 as satisfactionin full of any expenses incurred by it on behalf of Information Resourcesduring its representation of Information Resources in the antitrust litigation.Further, as full and final satisfaction of any and all other amounts thatBoies, Schiller & Flexner has claimed or may claim were due to itin consideration for its representation of Information Resources in theantitrust litigation, Boies, Schiller & Flexner was to be entitled toa contingency fee of $3 million out of any recovery received by InformationResources in the antitrust litigation. If the contingency fee was not paid toBoies, Schiller & Flexner on or before July 15, 2005, this amountwas to begin to accrue interest, in an amount not to exceed $250,000, onJuly 16, 2005 at the rate of one-half of one percent per month. Boies,Schiller & Flexner has agreed to look solely to any recovery from theantitrust litigation for the payment of the $3 million contingency fee and anyinterest that may accrue thereon. On February 15, 2006, the rightsagents and Boies, Schiller & Flexner agreed that Information Resourceswould pay Boies, Schiller & Flexner a total of $2.7 million in fullsatisfaction of its obligations under the

 

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contingency fee arrangementbetween the parties, including any obligation to pay interest accrued thereon.Information Resources paid Boies, Schiller & Flexner this amount infull on March 22, 2006.

 

EXPENSES OF THE TRUST. Pursuantto the contingent value rights agreement, Information Resources will generallybe responsible for the expenses of the trust, subject to Information Resources’prior approval of those expenses. Information Resources will also beresponsible for all expenses relating to the indemnification obligations of thetrust described in the Prospectus or compliance with securities laws and therules of the OTC Bulletin Board. Information Resources will not be responsiblefor the expenses of the trust relating to indebtedness for borrowed money andas discussed above will be reimbursed for “claims expenses” paid by it. Anyexpenses not imposed on Information Resources as described above will begeneral obligations of the trust, payable out of the trust’s assets (includingout of any rights certificate payment amounts received pursuant to thecontingent value rights agreement). Information Resources will be entitled todeduct from the amounts payable to the trust under the contingent value rightsagreement those expenses of the trust described as deductible expenses in “—PaymentCalculation” above.

 

**MaterialFederal Income Tax Consequences**

 

For Federal income taxpurposes, the trust is treated as a “grantor trust” and is not intended to bean association taxable as a corporation, joint venture, partnership or otherentity. Accordingly, each holder of a rights certificate will be treated forFederal income tax purposes as the owner of a pro rata share of the trust’s assetsand will be treated as receiving any amounts received by the trust when thoseamounts are received by the trust (and as making payments to third parties whenthe trust pays such amounts). The trust files Form 1041, U.S. Income TaxReturn for Estates and Trusts. The holders of rights certificates are providedan information statement reporting their portion of the trust’s income/loss. Asa result of the settlement that occurred in February 2006, each holder ofa rights certificate will receive a pro rata share of the aggregate CVR PaymentAmount. The trust intends to treat payments made to holders of rightscertificates as deferred payments relating back to the November 2003acquisition of Information Resources with the result that a portion of theamount distributed will constitute imputed interest as provided inSection 483 of the Internal Revenue Code. In addition to this imputedinterest, the distribution will also include actual interest from the time ofthe settlement up to the date of distribution, as well as interest included inthe balance of the escrow fund. In general, for U.S. federal income taxpurposes, holders of rights certificates will recognize gain (or loss) to theextent that the pro rata amount received, net of interest, is more (or less)than the portion of the holder’s allocable basis in the rights certificates. Itis expected that additional tax reporting information will be made available atthe time of the distribution to the holders of rights certificates.

 

**SummaryFinancial Information**

The following is a summary thatdetails the antitrust litigation escrow account expense activity for the yearended December 31, 2005 and the period ended March 31, 2006, as well asthe amounts available to cover incurred but unpaid antitrust litigationexpenses:

 
| ***Litigation Escrow Account Fund Balance,  December 31, 2003***                                                                                           | *** *** | $          | 10,045,548 |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------|------------|------------|--------|
| Reimbursements to Information Resources,  Inc. or paid directly to third party providers out of the escrow account as  of December 31, 2005                     |         | (7,069,808 | )          |
| ***Interest Earned on Balance of Escrow Fund  as of December 31, 2005***                                                                                        | *** *** | 108,866    |       |
| ***Litigation Escrow Account Fund Balance,  December 31, 2005***                                                                                           | *** *** | 3,084,606  |       |
| Reimbursements to Information Resources,  Inc. or paid directly to third party providers out of the escrow account from  January 1, 2006 through March 31, 2006 |         | (102,784   | )          |
| ***Distribution to CVR Trust as part of  litigation settlement on March 23, 2006***                                                                             | *** *** | (2,738,003 | )          |
| ***Interest Earned on Balance of Escrow Fund  from January 1, 2006 through March 31, 2006***                                                                    | *** *** | 27,147     |       |
| ***Litigation Escrow Account Fund Balance,  March 31, 2006***                                                                                              | *** *** | 270,966    |       |
| ***EXPENSES***                                                                                                                                                  | * *     |       |       |
| Claims Expenses Reimbursable to Information  Resources, Inc. for services rendered / expenses incurred as of March 31,  2006                                    |         | (48,542    | )          |
| Rights Agents Fees Reimbursable to  Information Resources, Inc. for services rendered / expenses incurred as of  March 31, 2006                                 |         | (10,000    | )          |
| Claims Expenses Incurred but Unpaid by  Information Resources, Inc. for services rendered / expenses incurred as of  March 31, 2006                             |         | (3,436     | )          |
| Total Claims Expenses                                                                                                                                           |         | (61,978    | )          |
| * *                                                                                                                                                        | * *     |       |       |
| ***Funds Available for Future Claims Expenses  as of March 31, 2006***                                                                                          | *** *** | $          | 208,988    |   |

 

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**ForwardLooking Information**

 

Statements and financialdiscussion and analysis by the litigation trustees contained throughout thisQuarterly Report on Form 10-Q that are not historical facts are forward-lookingstatements made pursuant to the safe harbor provisions of the PrivateSecurities Litigation Reform Act of 1995. Forward-looking statements involve anumber of risks and uncertainties.  Forfurther information regarding these risks and uncertainties, please see thesection of the Prospectus entitled “Risk Factors.”

 

**ITEM3.   *Quantitative andQualitative Disclosures About Market Risk.***

 

Not Applicable.

 

**ITEM4.   *Controls and Procedures.***

 

The litigation trustees haveconcluded that the registrant’s disclosure controls and procedures areeffective based on their evaluation of these controls as of March 31,2006.  There have been no changes in theregistrant’s internal controls during the quarter ended March 31, 2006,including over financial reporting, or in other factors that couldsignificantly affect internal controls subsequent to that date.

 

**PART II — OTHER INFORMATION**

 

**ITEM1.   *Legal Proceedings.***

 

The Registrant is not a partyto any legal proceedings.  For adiscussion of the litigation in which the Registrant has an interest, see PartI, Item 2, “Management’s Discussion and Analysis of Financial Condition andResults of Operations — The Litigation.”

 

**ITEM6.   *Exhibits and Reports onForm 8-K.***

 
| (a)    |   | Exhibits                                                                                                                                                                                                                                                                                                                                                                                                                          |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 10.1   |   | Amended and  Restated Declaration of Trust (1)                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.2   |   | Contingent  Value Rights Agreement (2)                                                                                                                                                                                                                                                                                                                                                                                            |
| 10.3   |   | Amendment  No. 1 to Contingent Value Rights Agreement (3)                                                                                                                                                                                                                                                                                                                                                                         |
| 31.1   |   | Certification  Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, signed by  Joseph P. Durrett filed with this  Form 10-Q                                                                                                                                                                                                                                                                                            |
| 31.2   |   | Certification  Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, signed by  Monica M. Weed filed with this  Form 10-Q                                                                                                                                                                                                                                                                                               |
| 32.1   |   | Certification  of Quarterly Report by Litigation Trustee Joseph P. Durrett furnished with  this Form 10-Q. This Certification shall not be deemed “filed” for purposes  of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to  the liability of that section, nor shall it be incorporated by reference into  any filing of the Securities Act of 1933 or the Securities Exchange Act of  1934. |
| 32.2   |   | Certification  of Quarterly Report by Litigation Trustee Monica M. Weed furnished with this  Form 10-Q. This Certification shall not be deemed “filed” for purposes of  Section 18 of the Securities Exchange Act of 1934, or otherwise subject to  the liability of that section, nor shall it be incorporated by reference into  any filing of the Securities Act of 1933 or the Securities Exchange Act of  1934.    |

 

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| (1) |   | Exhibit is  incorporated by reference to the Current Report on Form 8-K, filed with the  SEC on November 12, 2003 |
|-----|--------|------------------------------------------------------------------------------------------------------------------------|
| (2) |   | Exhibit is  incorporated by reference to the Current Report on Form 8-K, filed with the  SEC on November 12, 2003 |
| (3) |   | Exhibit is  incorporated by reference to the Current Report on Form 8-K, filed with the  SEC on January 21, 2004  |

 

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**SIGNATURES**

 

Pursuant tothe requirements of Section 13 or 15(d) of the Securities Exchange Act of1934, the Registrant has duly caused this report to be signed on its behalf bythe undersigned thereunto duly authorized.

 

Dated: May 8, 2006

 

 
|   | INFORMATION  RESOURCES, INC.  CONTINGENT RIGHTS PAYMENT TRUST |
|--------|---------------------------------------------------------------|
|   |                                                          |   |
|   | By:                                                           | /s/ JOSEPH  P. DURRETT |   |
|   |                                                          | Joseph P. Durrett |
|   |                                                          | Litigation  Trustee |

 

Pursuant tothe requirements of the Securities Exchange Act of 1934, this report has beensigned below by the following persons on behalf of the Registrant and in thecapacities indicated on May 8, 2006.

 
| **Signature**         | ** ** | **Title**           |
|-----------------------|------------|---------------------|
|                  |       |                |
| /s/ JOSEPH P. DURRETT |       | Litigation  Trustee |
| Joseph P. Durrett     |       |                |
|                  |       |                |
| /s/ MONICA M. WEED    |       | Litigation  Trustee |
| Monica M. Weed        |       |                |

 

**INDEX TO EXHIBITS**

** **
| 10.1 |   | Amended and Restated Declaration of Trust (1)                                                                                                                                                                                                                                                                                                                                                                                    |
|------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 10.2 |   | Contingent Value Rights Agreement (2)                                                                                                                                                                                                                                                                                                                                                                                            |
| 10.3 |   | Amendment No. 1 to Contingent Value Rights Agreement (3)                                                                                                                                                                                                                                                                                                                                                                         |
| 31.1 |   | Certification Pursuant to Section 302 of the Sarbanes-Oxley Act  of 2002, signed by Joseph P. Durrett filed with this  Form 10-Q                                                                                                                                                                                                                                                                                            |
| 31.2 |   | Certification Pursuant to Section 302 of the Sarbanes-Oxley Act  of 2002, signed by Monica M. Weed filed with this  Form 10-Q                                                                                                                                                                                                                                                                                               |
| 32.1 |   | Certification of Quarterly Report by Litigation Trustee Joseph P.  Durrett furnished with this Form 10-Q. This Certification shall not be deemed  “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or  otherwise subject to the liability of that section, nor shall it be  incorporated by reference into any filing of the Securities Act of 1933 or  the Securities Exchange Act of 1934. |
| 32.2 |   | Certification of Quarterly Report by Litigation Trustee Monica M.  Weed furnished with this Form 10-Q. This Certification shall not be deemed  “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or  otherwise subject to the liability of that section, nor shall it be  incorporated by reference into any filing of the Securities Act of 1933 or  the Securities Exchange Act of 1934.    |

 

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| (1) |   | Exhibit is  incorporated by reference to the Current Report on Form 8-K, filed with the  SEC on November 12, 2003 |
|-----|--------|------------------------------------------------------------------------------------------------------------------------|
| (2) |   | Exhibit is  incorporated by reference to the Current Report on Form 8-K, filed with the  SEC on November 12, 2003 |
| (3) |   | Exhibit is  incorporated by reference to the Current Report on Form 8-K, filed with the  SEC on January 21, 2004  |

 

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