Exhibit 10.1

 

EMPLOYMENT AGREEMENT

 

EMPLOYMENT AGREEMENT (this “Agreement”), entered into on July 1, 2015, between
PRA Health Sciences, Inc. (“Parent”), PRA International, a Delaware corporation
(the “Company”) and Linda Baddour (the “Executive”).

 

WITNESSETH:

 

WHEREAS, prior to the Effective Date, the Executive has rendered services to the
Company upon and subject to the terms, conditions and other provisions of that
certain Employment Agreement dated June 4, 2007 between the Executive and the
Company, as amended on June 4, 2011 (the “Prior Agreement”), which Prior
Agreement by its terms expired effective June 4, 2015; and

 

WHEREAS, Parent and the Company desire to continue to assure itself of the
services of the Executive and wish for the Executive to remain the Executive
Vice President and Chief Financial Officer of the Company and the Executive is
willing to enter into an agreement to that end, upon the terms and conditions
hereinafter set forth.

 

NOW, THEREFORE, in consideration of good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereby covenant
and agree as follows:

 

1.              Employment

 

The Company hereby agrees to continue to employ the Executive, and the Executive
hereby agrees to remain in the employ of the Company, on and subject to the
terms and conditions of this Agreement.

 

2.              Term

 

The period of this Agreement (the “Agreement Term”) shall commence on June 5,
2015 (the “Effective Date”) and shall expire on the fourth anniversary of the
Effective Date.

 

3.              Position, Duties and Responsibilities

 

(a)                           The Executive shall serve as, and with the title,
office and authority of, Executive Vice President and Chief Financial Officer of
both Parent and the Company.  The Executive shall also hold similar titles,
offices and authority with the Company’s subsidiaries and its successors.

 

(b)                           The Executive shall have all powers, authority,
duties and responsibilities usually incident to the positions and offices of
Executive Vice President and Chief Financial Officer of both Parent and the
Company.  The Executive shall report directly to the Company’s Chief Executive
Officer.

 

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(c)                            The Executive agrees to devote substantially all
of her business time, efforts and skills to the performance of her duties and
responsibilities under this Agreement; provided, however, that nothing in this
Agreement shall preclude the Executive from devoting reasonable periods required
for (i) participating in professional, educational, philanthropic, public
interest, charitable, social or community activities, (ii) serving as a director
or member of an advisory committee of any corporation or other entity that the
Executive is serving on as of the Effective Date or, subject to prior approval
of the Board of Directors of Parent (the “Board”), any other corporation or
entity that is not in competition with the Company, or (iii) managing her
personal investments; provided, further, that any such activities set forth in
clauses (i) through (iii) above do not materially interfere with the Executive’s
regular performance of her duties and responsibilities hereunder.

 

(d)                           The Executive shall perform her duties at the
offices of the Company located in Raleigh, North Carolina, but from time to time
the Executive may be required to travel to other locations in the proper conduct
of her responsibilities under this Agreement.

 

4.              Compensation and Benefits

 

In consideration of the services rendered by the Executive during the Agreement
Term, the Company shall pay or provide the Executive the compensation and
benefits set forth below.

 

(a)                           Salary. The Company shall pay the Executive a base
salary (the “Base Salary”) equal to $400,000 per annum. The Base Salary will be
periodically reviewed by the Compensation Committee of the Board (the
“Compensation Committee”) for possible merit increases as the Compensation
Committee deems appropriate. The Base Salary may not be reduced following the
Effective Date. The Base Salary shall be paid in arrears in substantially equal
installments at monthly or more frequent intervals, in accordance with the
normal payroll practices of the Company.

 

(b)                           Annual Incentive Bonuses. The Company shall
provide the Executive with the opportunity to earn an annual target bonus of
$165,000 for each calendar year of the Company ending during the Agreement Term,
as determined by the Compensation Committee in its discretion (the “Annual
Bonus”). The amount, if any, of such Annual Bonus shall be determined based upon
the Company’s and/or the Executive’s attainment of reasonable performance goals
approved by the Compensation Committee in its sole discretion. Each such Annual
Bonus shall be payable on such date or dates as is determined by the
Compensation Committee. Notwithstanding any other provision of this
Section 4(b), no bonus shall be payable pursuant to this Section 4(b) unless the
Executive remains continuously employed with the Company through the applicable
bonus payment date.  Any Annual Bonus hereunder shall otherwise be payable under
the terms of the Company’s annual bonus program for its senior officers.

 

(c)                            Benefits and Perquisites. The Executive will
participate in all executive compensation plans, including cash-based long-term
incentive plans, and in the same benefits and perquisites maintained by the
Company for senior executives.

 

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5.              Equity Incentives

 

During the Employment Term, the Executive will be eligible for such equity
incentive awards under the PRA Health Sciences, Inc. 2014 Omnibus Incentive Plan
(the “Plan”) (or any successor plan), as the Compensation Committee shall
determine in its discretion.

 

6.              Termination of Employment

 

The Agreement Term will be terminated upon the occurrence of any of the
following events:

 

(a)                                 Resignation for Good Reason. The Executive
may voluntarily terminate her employment hereunder for Good Reason. For purposes
of this Agreement, “Good Reason” shall mean any of the following:

 

(i)                                     Any material breach of this Agreement by
Parent or the Company;

 

(ii)                                  The material diminution, without the
Executive’s written consent, of the Executive’s position, title, authority,
duties or responsibilities as indicated in the Employment Agreement, or the
appointment of any other person, without the Executive’s written consent, to
perform any material part of such duties, including without limitation, the
failure of the Executive to have such duties and responsibilities with respect
to the acquiring entity following a Change in Control (as defined below); or

 

(iii)                               The failure by Parent or the Company, as
applicable, to obtain the assumption in writing of its obligation to perform
under this Agreement by any successor to all or substantially all of the assets
of the Company.

 

The Executive may terminate her employment for Good Reason by providing the
Company thirty (30) days’ written notice setting forth in reasonable specificity
the event that constitutes Good Reason, within ninety (90) days of the
occurrence of such event.

 

During such thirty (30) day notice period, Parent or the Company, as applicable,
shall have the opportunity to cure (if curable) the event that constitutes Good
Reason, and if not cured within such period, the Executive’s termination will be
effective upon the expiration of such cure period. For purposes of this
Agreement, “Change in Control” shall be as defined under the Plan on the date of
the Change in Control or as defined under the Plan on the date hereof, whichever
is more favorable to the Executive.

 

(b)                                 Resignation without Good Reason. The
Executive may voluntarily terminate her employment hereunder for any reason at
any time, including for any reason that does not constitute Good Reason.

 

(c)                                  Termination for Cause. Parent or the
Company may terminate the Executive’s employment hereunder for Cause. For
purposes of this Agreement, the Executive shall be considered to be terminated
for “Cause” only upon the occurrence of any of the following:

 

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(i)                                     A material breach of this Agreement by
the Executive (where the Executive fails to cure such breach within ten
(10) business days after being notified in writing by Parent or the Company of
such breach);

 

(ii)                                  The Executive’s failure (except where due
to a physical or mental incapacity) to substantially perform her material duties
with respect to the Company which continues beyond ten (10) days after a written
demand for substantial performance is delivered to the Executive by Parent or
the Company;

 

(iii)                               The Executive engaging in or causing an act
of willful misconduct that has a material adverse impact on the reputation,
business, business relationships or financial condition of the Company;

 

(iv)                              The Executive’s conviction of, or plea of
guilty or nolo contendere to, a felony, or any crime involving moral turpitude
not involving a traffic offense; or

 

(v)                                 The Executive’s willful refusal to perform
the specific lawful directives of the Board which are consistent with the scope
of the Executive’s duties and responsibilities hereunder;

 

provided, however, that no action taken by the Executive in the reasonable, good
faith belief that it was in the best interests of the Company shall be treated
as a basis for termination of the Executive’s employment for Cause under clause
(i) above, and no failure of the Executive or the Company to achieve performance
goals, alone, shall be treated as a basis for termination of the Executive’s
employment for Cause under clause (ii) or (v) above.

 

(d)                                 Termination without Cause. The Board shall
have the right to terminate the Executive’s employment hereunder other than for
Cause at any time, subject to the consequences of such termination as set forth
in this Agreement.

 

(e)                                  Disability. The Executive’s employment
hereunder shall terminate upon her Disability. For purposes of this Agreement,
“Disability” shall mean the Executive is eligible for disability payments under
the Company’s long-term disability plan, as in effect on the date hereof.

 

(f)                                   Death. The Executive’s employment
hereunder shall terminate upon her death.

 

7. Compensation Upon Termination of Employment

 

In the event the Executive’s employment by Parent or the Company is terminated
during the Agreement Term, the Executive shall be entitled to the severance
payments and benefits specified below:

 

(a)                                      Resignation for Good Reason;
Termination without Cause. In the event the Executive voluntarily terminates her
employment hereunder for Good Reason or is terminated by Parent or the Company
other than for Cause, the Company shall pay the Executive and provide her with
the following:

 

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(i)                                     Accrued Obligations. The Company shall
pay and provide the Executive with her Accrued Obligations. For purposes of this
Agreement, “Accrued Obligations” shall consist of the following: (A) accrued and
unpaid Base Salary and accrued and unused paid time off through the date of
termination; (B) any accrued but unpaid annual bonus with respect to any
completed fiscal year of the Company which has ended prior to the date of
termination (except upon an involuntary termination for Cause or the existence
of Cause is found following a voluntary termination); (C) all accrued and vested
benefits under employee pension (including 401(k)) and welfare plans in which
the Executive participates, in accordance with applicable plan terms; and
(D) unreimbursed business expenses incurred through the termination date, in
accordance with Company business expense reimbursement policy.

 

(ii)                                  Severance Payment. The Company shall pay
the Executive an amount equal to the sum of the Executive’s annual Base Salary
and an amount equal to the Annual Bonus for the calendar year immediately
preceding the date of the termination of employment (such sum hereinafter
defined as the “Severance Amount”). The Severance Amount shall be paid over the
twelve (12) calendar months beginning in the calendar month immediately
following the date of the termination of employment, in substantially equal
installments at monthly or more frequent intervals and in accordance with the
normal payroll practices of the Company.

 

(iii)                               Equity Rights. The vesting and
exercisability of any outstanding stock options or other equity awards held by
the Executive at the time of termination of employment will be governed by the
terms of such awards.

 

(iv)                              Company-Paid Continuation Coverage. Following
the date of the Executive’s termination of employment, the Executive and her
eligible dependents shall be entitled to continue participating in the Company’s
group medical, dental, and other health benefit coverages as required under the
health care continuation requirements of the Consolidated Omnibus Reconciliation
Act of 1985 (“COBRA”). Such coverages shall be provided to the Executive and her
eligible dependents for the 12-month period following the date of the
Executive’s termination of employment with the same employee cost-sharing as is
provided to employees of the Company generally during this 12-month period;
provided, however, that if the Company providing any payment or benefit pursuant
to this Section 7(a)(iv) would violate the nondiscrimination rules applicable to
non-grandfathered plans, or result in the imposition of penalties under, the
Patient Protection and Affordable Care Act of 2010 (“PPACA”) and related
regulations and guidance promulgated thereunder, the parties agree to reform
this Section 7(a)(iv) in such manner as is necessary to comply with PPACA (the
“Company-Paid Continuation Coverage”).

 

(b)                                      Resignation without Good Reason;
Termination for Cause; Death; Disability. In the event the Executive voluntarily
terminates her employment hereunder other than for Good Reason, is terminated by
Parent or the Company for Cause, or is terminated on account of death or
Disability, neither Parent nor the Company shall have any obligations to the
Executive under this Agreement other than to pay the Executive and provide her
with any Accrued Obligations.

 

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The vesting and exercisability of any outstanding stock options or other equity
awards held by the Executive at the time of any such termination of employment
will be governed by the terms of such awards.

 

8.              Change in Control

 

In the event that the employment of the Executive is terminated on or prior to
the expiration of the one-year period immediately following a Change in Control
either (a) by the Executive for Good Reason or (b) by the Company other than for
Cause: (i) in lieu of the Severance Amount payable pursuant to
Section 7(a)(ii) hereof, the Executive will be entitled to a lump-sum payment
equal to two times the Severance Amount (as calculated under
Section 7(a)(ii) hereof), payable within sixty (60) days of termination of
employment; and (ii) in lieu of the Company-Paid Continuation Coverage being
provided for twelve (12) months pursuant to Section 7(a)(iv) hereof, the
Executive will be entitled to Company-Paid Continuation Coverage for twenty-four
(24) months following termination of employment.

 

9.              Effect of Excise Tax and Limit on Golden Parachute Payments.

 

(a)                                 Contingent Reduction of Parachute Payments.
If there is a change in ownership or control of the Parent that would cause any
payment or distribution by the Parent or any of its subsidiaries or any other
person or entity to the Executive or for the Executive’s benefit (whether paid
or payable or distributed or distributable pursuant to the terms of this
Agreement or otherwise) (each, a “Payment”, and collectively, the “Payments”) to
be subject to the excise tax imposed by Section 4999 of the Internal Revenue
Code (the “Code”) (such excise tax, together with any interest or penalties
incurred by the Executive with respect to such excise tax, the “Excise Tax”),
then the Executive will receive the greatest of the following, whichever gives
the Executive the highest net after-tax amount (after taking into account
federal, state, local and social security taxes): (1) the Payments or (2) one
dollar less than the amount of the Payments that would subject the Executive to
the Excise Tax (the “Safe Harbor Amount”). If a reduction in the Payments is
necessary so that the Payments equal the Safe Harbor Amount, then the reduction
will be determined in a manner which has the least economic cost to the
Executive and, to the extent the economic cost is equivalent, will be reduced in
the inverse order of when payment would have been made to the Executive, until
the reduction is achieved.  Any reductions pursuant to this Section shall be
made in a manner intended to be consistent with the requirements of Section 409A
of the Code and the Department of Treasury Regulations and other interpretive
guidance issued thereunder, including without limitation any such regulations or
other guidelines that may be issued after the Effective Date (“Section 409A”).

 

(b)                                 Determination of the Payments. All
determinations required to be made under this Section, including whether and
when the Safe Harbor Amount is required and the amount of the reduction of the
Payments and the assumptions to be utilized in arriving at such determination,
shall be made by a certified public accounting firm designated by the Parent
(the “Accounting Firm”) which shall provide detailed supporting calculations
both to the Parent and the Executive within fifteen (15) business days of the
receipt of notice from the Executive that there has been a Payment, or such
earlier time as is requested by the Parent. All fees and expenses of the
Accounting Firm shall be borne solely by the Parent. Any determination by the
Accounting Firm

 

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shall be binding upon the Parent and the Executive. The Executive shall
cooperate with any reasonable requests by the Parent in connection with any
contests or disputes with the Internal Revenue Service in connection with the
Excise Tax.

 

(c)                                  Adjustments.                        As a
result of the uncertainty in the application of Section 4999 of the Code at the
time of a determination hereunder, it is possible that Payments will be made
which should not have been made under clause (a) of this Section (“Overpayment”)
or that additional Payments which are not made pursuant to clause (a) of this
Section should have been made (“Underpayment”).  In the event that there is a
final determination by the Internal Revenue Service, or a final determination by
a court of competent jurisdiction, that an Overpayment has been made, any such
Overpayment shall be treated for all purposes as a loan to the Executive which
the Executive shall repay to the Parent together with interest at the applicable
Federal rate provided for in Section 7872(f)(2) of the Code.  In the event that
there is a final determination by the Internal Revenue Service, a final
determination by a court of competent jurisdiction or a change in the provisions
of the Code or regulations pursuant to which an Underpayment arises under this
Agreement, any such Underpayment shall be promptly paid by the Parent to or for
the benefit of the Executive, together with interest at the applicable Federal
rate provided for in Section 7872(f)(2) of the Code.

 

(d)                                 Consultation.  The Parent shall consult with
the Executive in good faith regarding the implementation of the provisions of
this Section and the application of Sections 4999 and 409A of the Code;
provided, that neither the Parent nor any of its subsidiaries, employees or
representatives shall have any liability to the Executive with respect thereto.

 

10.       No Mitigation

 

The Executive shall not be required to seek other employment or to reduce any
severance benefit payable to her under Section 7 or 8 hereof, and no such
severance benefit shall be reduced on account of any compensation received by
the Executive from other employment.

 

11.       Release

 

All payments and benefits provided under Section 7(a)(ii) and (iv) or Section 8
hereof, as applicable, shall be conditioned upon the Executive executing and
honoring a release of claims in favor of Parent and the Company in the Company’s
standard form for Company officers in accordance with Section 22(c) hereof (the
“Release”).

 

12.       Tax Withholding

 

All compensation payable pursuant to this Agreement shall be subject to
reduction by all applicable withholding, social security and other federal,
state and local taxes and deductions.

 

13.       Restrictive Covenants

 

(a)                                 Covenant Not to Disclose Confidential
Information. The Executive acknowledges that during the course of her
affiliation with the Company she has or will have access to and knowledge of
certain information and data which the Company considers

 

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confidential and the release of such information or data to unauthorized persons
would be extremely detrimental to the Company. As a consequence, the Executive
hereby agrees and acknowledges that she owes a duty to the Company not to
disclose, and agrees that without the prior written consent of the Company, at
any time, either during or after her employment with the Company, she will not
communicate, publish or disclose, to any person anywhere or use, any
Confidential Information (as hereinafter defined), except as may be necessary or
appropriate to conduct her duties hereunder, provided the Executive is acting in
good faith and in the best interests of the Company, or as may be required by
law or judicial process. The Executive will use her best efforts at all times to
hold in confidence and to safeguard any Confidential Information from falling
into the hands of any unauthorized person and, in particular, will not permit
any Confidential Information to be read, duplicated or copied. The Executive
will promptly return to the Company all Confidential Information in the
Executive’s possession or under the Executive’s control whenever the Company
shall so request, and in any event will promptly return all such Confidential
Information if the Executive’s relationship with the Company is terminated for
any or no reason and will not retain any copies thereof. For purposes hereof the
term “Confidential  Information” shall mean any information or data used by or
belonging or relating to the Company or any of its subsidiaries or affiliates
that is not known generally to the industry in which the Company maintains on a
confidential basis, including, without limitation, any and all trade secrets,
proprietary data and information relating to the Company’s business and
products, price lists, customer lists, processes, procedures or standards,
know-how, manuals, business strategies, records, drawings, specifications,
designs, financial information, whether or not reduced to writing, or
information or data which the Company advises the Executive should be treated as
confidential information.

 

(b)                                 Covenant Not to Compete. The Executive
acknowledges that she has established and will continue to establish favorable
relations with the customers, clients and accounts of the Company and will have
access to Confidential Information and trade secrets of the Company. Therefore,
in consideration of such relations and to further protect Confidential
Information and trade secrets, directly or indirectly, of the Company, the
Executive agrees that, at all times during her employment by the Company
(including prior to the Effective Date) and for a period of twelve (12) months
from the date of termination of the Executive, the Executive has not and will
not, directly or indirectly, without the express written consent of the Company:

 

(i)                                     within (A) the country, region of the
country, state, and/or surrounding states in which the Executive’s office with
the Company was located at the time of the Executive’s termination, or (B) fifty
miles of the location of the Executive’s office with the Company at the time of
Executive’s termination, be engaged or employed by a Competing CRO, whether as
owner, manager, officer, director, employee, consultant or otherwise to perform
duties and responsibilities that are the same or substantially related to the
duties and responsibilities that the Executive performed for the Company at any
time during the twenty-four (24) months prior to the Executive’s termination.
“Competing CRO” means any entity (and its respective affiliates and successors)
that competes with the Company in the provision of Customer Services. “Customer
Services” means any product or service provided by the Company to a third party
for remuneration, including, but not limited to on a contract or outsourced
basis, assisting pharmaceutical or biotechnology companies in developing and
taking drug compounds, biologics, and drug

 

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delivery devices through appropriate regulatory approval processes, and/or
recruiting, staffing and placement of personnel in the areas of clinical
research, medical writing, biostatistics and programming, in each case
(A) during the period of the Executive’s employment with the Company prior to
the date of this Agreement, through the end of the Agreement Term or (B) about
which the Executive has knowledge and that which the Executive had knowledge
that the Company will provide or has contracted to provide to third parties
during the twelve (12) months following the Agreement Term;

 

(ii)                                  directly or indirectly, whether as owner,
manager, officer, director, employee, consultant or otherwise, solicit the
business of, or accept business from any Customer of the Company, unless the
business being solicited or accepted is not in competition with or substantially
similar to the Company’s business. For the purposes of this Section 13(b),
“Customer” means any person or legal entity (and its subsidiaries, agents,
employees and representatives) about whom the Executive has acquired information
during the period of the Executive’s employment with the Company prior to the
date of this Agreement, through the end of the Agreement Term and as to whom the
Executive has knowledge that the Company has provided or does provide services
at any time upon, or during the twenty-four (24) months prior to, the
Executive’s termination, or will during the twelve (12) months following the
Agreement Term provide services; or

 

(iii)                               directly or indirectly, (A) solicit or
induce (or attempt to solicit or induce) to leave the employ of the Company or
any of its affiliates for any reason whatsoever any person employed by the
Company or any of its affiliates at the time of the act of solicitation or
inducement or (B) hire any person who was employed by the Company at the time of
the Executive’s termination or at any time during the six months prior to the
Executive’s termination.

 

Notwithstanding anything in this Agreement to the contrary, the Company shall
have the option to continue to bind the Executive to the provisions of this
Section 13(b) for a period of twelve (12) months following a termination of
employment which occurs after the expiration of the Agreement and the Agreement
Term, provided that, the Company provides the Executive with the payments and
benefits set forth in Section 7(a) hereof.

 

(c)                                  Non-Disparagement. At all times during her
employment by the Company (including prior to the Effective Date) and
thereafter, the Executive shall express no opinions or views or knowingly take
any other actions that will adversely affect the business reputation or goodwill
of the Company, its affiliates, directors, officers or employees.

 

(d)                                 Specific Performance. Recognizing that
irreparable damage will result to the Company in the event of the breach or
threatened breach of any of the foregoing covenants and assurances by the
Executive contained in paragraphs (a), (b) or (c) hereof, and that the Company’s
remedies at law for any such breach or threatened breach will be inadequate, the
Company and each of their successors and assigns, in addition to such other
remedies which may be available to them, shall be entitled to an injunction,
including a mandatory injunction, to be issued by any court of competent
jurisdiction ordering compliance with this Agreement or enjoining and
restraining the Executive, and each and every person, firm or company acting in
concert or participation with her, from the continuation of such breach and, in
addition thereto,

 

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she shall pay to the Company all ascertainable damages, including costs and
reasonable attorneys’ fees sustained by the Company by reason of the breach or
threatened breach of said covenants and assurances. The obligations of the
Executive and the rights of the Company, its successors and assigns under this
Section 13 shall survive the termination of this Agreement for the periods set
forth above. The covenants and obligations of the Executive set forth in this
Section 13 are in addition to and not in lieu of or exclusive of any other
obligations and duties of the Executive to the Company, whether express or
implied in fact or in law. In addition, the Executive further acknowledges that
if she breaches any provision of this Section 13 following her termination of
employment with the Company, the Executive will forfeit the right to any unpaid
severance or other payments under this Agreement. For purposes of this
Section 13, “Company” shall include Parent and all subsidiaries of the Parent.

 

(e)                                  Potential Unenforceability of Any
Provision. If a final judicial determination is made that any provision of this
Agreement is an unenforceable restriction against the Executive, the provisions
hereof shall be rendered void only to the extent that such judicial
determination finds such provisions unenforceable, and such unenforceable
provisions shall automatically be reconstituted and become a part of this
Agreement, effective as of the date first written above, to the maximum extent
permitted by law.

 

14.       Indemnification

 

To the fullest extent permitted by the indemnification provisions of the
Articles of Incorporation and Bylaws of Parent and the Company, as applicable,
in effect as of the date of this Agreement, and the indemnification provision of
the laws of the jurisdiction of Parent’s and the Company’s incorporation, as
applicable, in effect from time to time, Parent and the Company, as applicable,
shall indemnify the Executive as a director, senior officer or employee of
Parent and the Company, as applicable, against all liabilities and reasonable
expenses that may be incurred in any threatened, pending or completed action,
suit or proceeding, and shall pay for the reasonable expenses incurred by the
Executive in the defense of or participation in any such action, suit or
proceeding to which the Executive is a party because of her service to Parent
and the Company, as applicable. The rights of the Executive under this
indemnification provision shall survive the termination of employment with
respect to events occurring prior to termination of employment on a basis not
less favorable than is provided for any other officer of Parent and the Company,
as applicable (other than the Chief Executive Officer). In addition, during the
Agreement Term, the Executive will be provided with Director & Officer coverage
to the same extent as any other officer of Parent and the Company, as applicable
(other than the Chief Executive Officer).

 

15.       Successors

 

(a)                                      This Agreement shall be binding upon
and shall inure to the benefit of Parent and the Company, as applicable, and
each of its successors and any person, firm, corporation or other entity which
succeeds to all or substantially all of the business, assets or property of
Parent or the Company, as applicable. As used in this Agreement, the “Company”
shall mean the Company as hereinbefore defined and any successor to its
business, assets or property as aforesaid which executes and delivers an
agreement provided for in this Section 15 or which

 

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otherwise becomes bound by all the terms and provisions of this Agreement by
operation of law.

 

(b)                                      This Agreement and all rights of the
Executive hereunder shall inure to the benefit of and be enforceable by the
Executive’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If the Executive should
die while any amounts are due and payable to her hereunder, all such amounts,
unless otherwise provided herein, shall be paid to the Executive’s designated
beneficiary or, if there be no such designated beneficiary, to the legal
representatives of the Executive’s estate.

 

16.       No Assignment

 

Except as to withholding of any tax under the laws of the United States or any
other country, state or locality, neither this Agreement nor any right or
interest hereunder nor any amount payable at any time hereunder shall be subject
in any manner to alienation, sale, transfer, assignment, pledge, attachment, or
other legal process, or encumbrance of any kind by the Executive or the
beneficiaries of the Executive or by her legal representatives without the
Company’s prior written consent, nor shall there be any right of set-off or
counterclaim in respect of any debts or liabilities of the Executive, her
beneficiaries or legal representatives, except in the case of termination of
employment for Cause (other than with respect to any set-off on nonqualified
deferred compensation that is subject to Section 409A); provided, however, that
nothing in this Section 16 shall preclude the Executive from designating a
beneficiary to receive any benefit payable on her death, or the legal
representatives of the Executive from assigning any rights hereunder to the
person or persons entitled thereto under her will or, in case of intestacy, to
the person or persons entitled thereto under the laws of intestacy applicable to
her estate.

 

17.       Entire Agreement

 

This Agreement contains the entire understanding of the parties with respect to
the subject matter hereof and, except as specifically provided herein, cancels
and supersedes any and all other agreements between the parties with respect to
the subject matter hereof, including but not limited to the Prior Agreement. Any
amendment or modification of this Agreement shall not be binding unless in
writing and signed by Parent, the Company and the Executive.

 

18.       Severability

 

In the event that any provision of this Agreement is determined to be invalid or
unenforceable, the remaining terms and conditions of this Agreement shall be
unaffected and shall remain in full force and effect, and any such determination
of invalidity or unenforceability shall not affect the validity or
enforceability of any other provision of this Agreement.

 

19.       Notices

 

All notices which may be necessary or proper for either Parent or the Company on
one hand, or the Executive on the other, to give to the other shall be in
writing and shall be delivered by hand or sent by registered or certified mail,
return receipt requested, or by air courier, to the Executive at the address of
the Executive on file with Parent or the Company (or such other

 

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address as the Executive may designate by written notice to Parent or the
Company) and shall be sent in the manner described above to the Secretary of the
Company at the Company’s principal executives offices at 4130 ParkLake Avenue,
Suite 400, Raleigh, North Carolina 27612 or delivered by hand to the Secretary
of the Company, and shall be deemed given when sent, provided that any notice
required under Section 6 hereof shall be deemed given only when received. Any
party may, by like notice to the other party, change the address at which she or
they are to receive notices hereunder.

 

20.       Governing Law

 

This Agreement shall be governed by and enforceable in accordance with the laws
of the State of North Carolina, without giving effect to the principles of
conflict of laws thereof.

 

21.       Arbitration

 

Except to the extent that injunctive relief is available for any breach of
restrictive covenants, any controversy or claim arising out of, or related to,
this Agreement, or the breach thereof, shall be settled by binding arbitration
in Raleigh, North Carolina, in accordance with the rules then obtaining of the
American Arbitration Association, and the arbitrator’s decision shall be binding
and final, and judgment upon the award rendered may be entered in any court
having jurisdiction thereof. Each party will pay one-half of the arbitration
expenses and her or its own legal fees and costs; provided, in any dispute after
a Change in Control, the Company (or successor) will pay all arbitration fees,
and all of the Executive’s reasonable legal expenses if the Executive prevails
on at least one material issue in dispute, as determined by the arbitrator.
Notwithstanding any other provision of this Agreement, obligations of the
parties under this Section 21 shall survive any termination of employment.

 

22.       Section 409A

 

(a)                                 General. The parties hereto acknowledge and
agree that, to the extent applicable, this Agreement shall be interpreted in
accordance with, and incorporate the terms and conditions required by,
Section 409A. Notwithstanding any provision of this Agreement to the contrary,
in the event that the Company determines that any amounts payable hereunder will
be immediately taxable to the Executive under Section 409A, the Company reserves
the right (without any obligation to do so or to indemnify the Executive for
failure to do so) to (a) adopt such amendments to this Agreement and appropriate
policies and procedures, including amendments and policies with retroactive
effect, that the Company determines to be necessary or appropriate to preserve
the intended tax treatment of the benefits provided by this Agreement, to
preserve the economic benefits of this Agreement and to avoid less favorable
accounting or tax consequences for the Company and/or (b) take such other
actions as the Company determines to be necessary or appropriate to exempt the
amounts payable hereunder from Section 409A or to comply with the requirements
of Section 409A and thereby avoid the application of penalty taxes thereunder.
No provision of this Agreement shall be interpreted or construed to transfer any
liability for failure to comply with the requirements of Section 409A from the
Executive or any other individual to the Company or any of its affiliates,
employees or agents.

 

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(b)                                 Separation from Service under Section 409A.
Notwithstanding any provision to the contrary in this Agreement: (i) no amount
shall be payable pursuant to Section 7 or 8 unless the termination of the
Executive’s employment constitutes a “separation from service” within the
meaning of Section 1.409A-1(h) of the Department of Treasury Regulations;
(ii) for purposes of Section 409A, the Executive’s right to receive any
installment payments or benefits pursuant to Section 7(a) shall be treated as a
right to receive a series of separate and distinct payments within the meaning
of Section 409A; and (iii) to the extent that any reimbursement of expenses or
in-kind benefits constitutes “deferred compensation” under Section 409A, such
reimbursement or benefit shall be provided no later than December 31 of the year
following the year in which the expense was incurred. The amount of expenses
reimbursed in one year shall not affect the amount eligible for reimbursement in
any subsequent year. The amount of any in-kind benefits provided in one year
shall not affect the amount of in-kind benefits provided in any other year.
Notwithstanding anything in this Agreement to the contrary, if the Executive is
deemed by the Company at the time of the Executive’s separation from service to
be a “specified employee” for purposes of Section 409A and to the extent delayed
commencement of any portion of the payments to which the Executive is entitled
under this Agreement is required in order to avoid subjecting the Executive to
additional tax or interest (or both) under Section 409A, then any such payment
shall not be provided to the Executive prior to the earlier of (i) the
expiration of the six (6) month period measured from the date of the separation
from service or (ii) the date of the Executive’s death. Upon the first business
day following the expiration of the applicable period, all payments deferred
pursuant to the preceding sentence shall be paid in a lump sum to the Executive
(or, if applicable, the Executive’s estate, heirs or legal representatives), and
any remaining payments due to the Executive under this Agreement shall be paid
as otherwise provided herein.

 

(c)                                  Release. Notwithstanding anything to the
contrary in this Agreement, to the extent that any payments of “nonqualified
deferred compensation” (within the meaning of Section 409A) due under this
Agreement as a result of the Executive’s termination of employment are subject
to the Executive’s execution and delivery of a Release as provided under this
Agreement: (i) the Company shall deliver the Release to the Executive within ten
(10) business days following the date of Executive’s termination of employment,
and the Company’s failure to deliver a Release prior to the expiration of such
ten (10) business day period shall constitute a waiver of any requirement to
execute a Release; (ii) if the Executive fails to execute the Release on or
prior to the Release Expiration Date (as defined below) or timely revokes her
acceptance of the Release thereafter, the Executive shall not be entitled to any
payments or benefits otherwise conditioned on the Release; and (iii) in any case
where the date of Executive’s termination of employment and the Release
Expiration Date fall in two separate taxable years, any payments required to be
made to the Executive that are conditioned on the Release and are treated as
nonqualified deferred compensation for purposes of Section 409A shall be made in
the later taxable year. For purposes of this Section 22(c), “Release Expiration
Date” shall mean the date that is twenty-one (21) days following the date upon
which the Company timely delivers the Release to the Executive, or, in the event
that the Executive’s termination of employment is “in connection with an exit
incentive or other employment termination program” (as such phrase is defined in
the Age Discrimination in Employment Act of 1967), the date that is forty-five
(45) days following such delivery date. To the extent that any payments of
nonqualified deferred compensation (within the meaning under Section 409A) due
under this Agreement as a result of

 

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the Executive’s termination of employment are delayed pursuant to this
Section 22(c), such amounts shall be paid in a lump sum on the first payroll
date following the date that the Executive executes and does not revoke the
Release (and the applicable revocation period has expired) or, in the case of
any payments subject to Section 22(c)(iii), on the first payroll period to occur
in the subsequent taxable year, if later.

 

23.       Counterparts

 

This Agreement may be executed in counterparts, and by different parties on
separate counterparts, each of which shall be deemed an original, but all such
counterparts shall together constitute one and the same instrument.

 

[Rest of page intentionally omitted]

 

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IN WITNESS WHEREOF, Parent, the Company and the Executive have executed this
Agreement as of the date first above written.

 

 

 

EXECUTIVE

 

 

 

 

 

/s/ Linda Baddour

 

Linda Baddour

 

 

 

 

 

PRA HEALTH SCIENCES, INC.

 

 

 

 

 

/s/ Colin Shannon

 

By: Colin Shannon

 

Title: Chairman, President & CEO

 

 

 

 

 

PRA INTERNATIONAL

 

 

 

 

 

/s/ Colin Shannon

 

By: Colin Shannon

 

Title: President

 

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