Exhibit 10.238

FORM OF NONQUALIFIED STOCK OPTION AWARD AGREEMENT

UNDER THE EQUITY COMPENSATION PLAN FOR ALL NON-DIRECTOR PARTICIPANTS

THIS AWARD AGREEMENT is made and entered into this              day of
                    ,              (the “Effective Date”), by and between
Pharmaceutical Product Development, Inc. (the “Company”), and
                     (the “Eligible Participant”).

WHEREAS, the Eligible Participant is a valuable and trusted employee of the
Company; and

WHEREAS, the Committee considers it desirable and in the best interests of the
Company that the Eligible Participant be given an opportunity to acquire a
proprietary interest in the Company as an incentive to advance the interests of
the Company; and

WHEREAS, the Committee desires to grant the Eligible Participant a nonqualified
stock option to purchase shares of the common stock of the Company (the “Common
Stock”), in accordance with the Equity Compensation Plan adopted by the
Directors and Shareholders of the Company effective as of October 30, 1995 as
amended and restated effective May 14, 2003, (the “Plan”) (Capitalized terms
used herein which are not otherwise defined herein shall have the meanings
ascribed to them under the Plan).

NOW, THEREFORE, in consideration of the premises, it is agreed by and between
the parties as follows:

1. Grant of Nonqualified Stock Option. The Company hereby grants to the Eligible
Participant a nonqualified stock option (the “Nonqualified Stock Option”) to
purchase              shares of Common Stock (the “Shares” ) at the purchase
price of $             per share in the manner and subject to the terms and
conditions contained herein and in the Plan.

2. Time of Exercise of Nonqualified Stock Option. The Nonqualified Stock Option
shall vest in accordance with the following schedule:

(a) The Nonqualified Stock Option shall vest and become exercisable with respect
to              shares on the first anniversary of the Effective Date.

(b) The Nonqualified Stock Option shall vest and become exercisable with respect
to              shares on the second anniversary of the Effective Date.

(c) The Nonqualified Stock Option shall vest and become exercisable with respect
to              shares on the third anniversary of the Effective Date.

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Subject to the termination provisions set forth in Section 5 hereof, the
Nonqualified Stock Option, to the extent vested, may be exercised in whole or in
part at any time and from time to time but in no event later than             
(“Exercise Period”). The Nonqualified Stock Option shall vest and become
exercisable pursuant to the foregoing schedule only if the Eligible Participant
is employed by the Company on the date specified.

3. Method of Exercise. The Nonqualified Stock Option shall be exercised by
written notice directed to the Committee, a form of which is attached hereto as
Exhibit A and incorporated herein by reference. As soon as practicable following
receipt of such notice from the Eligible Participant, the Committee shall notify
the Eligible Participant of the total of sums required pursuant to Section 1
above and Section 4 below. Said payment shall be by money order, certified
check, or cashiers check made payable to Pharmaceutical Product Development,
Inc. and must be received by the Company within three business days of Eligible
Participant’s notification of the sums required. Upon notice from the Committee
that the Eligible Participant has paid the price specified in Section 1 above
and Section 4 below, the Company shall notify its Transfer Agent to make
immediate delivery of such shares; provided that if any law or regulation
requires the Company to take any action with respect to the Shares specified in
such notice before the issuance thereof, then the date of delivery of such
Shares shall be extended for the period necessary to take such action.

4. Payment to Satisfy Withholding Obligations . Notwithstanding any other
provisions of this Award Agreement, any rights of the Eligible Participant to
exercise the Nonqualified Stock Option shall be conditioned upon the Eligible
Participant forwarding to the Company, in addition to the price per share
specified in Section 1 above, cash payment of an amount equal to the amount the
Company is required by law or regulation of any governmental authority, whether
federal, state or local, domestic or foreign, to withhold in connection with
such exercise of the Nonqualified Stock Option, if any, as determined by the
Committee in its discretion. The amount of such payment shall be communicated to
the Eligible Participant by the Committee as soon as practicable following the
Committee’s receipt of the notice specified in Section 3. In lieu of payment
specified in this Section 4, the Committee may in its discretion agree with the
Eligible Participant to another means of satisfying the Company’s withholding
obligation in connection with the exercise of the Nonqualified Stock Option.

5. Termination of Nonqualified Stock Option. The Nonqualified Stock Option to
the extent unvested shall terminate and lapse immediately as of the date of
Termination of Employment of Eligible Participant for any reason, including
death or disability. Except as otherwise stated herein, the Nonqualified Stock
Option, to the extent vested shall terminate and cease to be exercisable upon
the first to occur of the following:

(a) the date all Shares available for purchase under this Award Agreement have
been so purchased:

 

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(b) upon the expiration of three (3) months following the Eligible Participant’s
Termination of Employment, except as provided in Section 5(c) or (d) below:

(c) upon the expiration of one (1) year following the Eligible Participant’s
Termination of Employment where employment shall have terminated as a result of
death or Disability;

(d) upon the expiration of one (1) year following the date of the Eligible
Participant’s death, if death shall have occurred following the Eligible
Participant’s Termination of Employment and while the Nonqualified Stock Option
was still exercisable; or

(e) upon the expiration of the Exercise period set forth in Section 2 above.

In addition, if the Eligible Participant (i) is terminated by the Company “for
cause” (as hereinafter defined) or (ii) voluntarily terminates his employment
with the Company and within twelve (12) months after such voluntary termination
either (x) discloses confidential information of the Company, (y) becomes
employed by an entity in a capacity such that his duties place him in
substantial competition with the Company or otherwise engages in activities
which by their nature substantially compete with the business of the Company, or
(z) induces an employee of the Company to terminate his employment with the
Company, then in any such cases the Nonqualified Stock Option shall terminate
with respect to all Shares available for purchase under this Award Agreement
and, with respect to all Shares pursuant to this Nonqualified Stock Option
during the period beginning six (6) months prior to the Eligible Participant’s
termination as herein defined and ending on the date which is twelve (12) months
after the date upon which the Eligible Participant’s employment with the Company
is terminated, refund to the Company a sum equal to the difference between the
purchase price set forth in Section 1 above and the NASDAQ closing price of the
Shares on the date of each exercise of this Nonqualified Stock Option during
said period. Termination “for cause” as used herein means (1) an act or acts
involving fraud, embezzlement or theft from the Company, (2) the Eligible
Participant’s willful or negligent and repeated failure to perform the duties
assigned to the Eligible Participant or to follow directions of the Eligible
Participant’s supervisor as evidenced by written documentation in the Eligible
Participant’s personnel file, or (3) termination for cause as defined in and
made pursuant to a then effective employment agreement, if any, between the
Eligible Participant and the Company.

6. Rights Prior to Exercise of Nonqualified Stock Option. The Eligible
Participant shall have no rights as a stockholder with respect to the Shares
except to the extent he has exercised the Nonqualified Stock Option, paid the
Nonqualified Stock Option price for such Shares and any withholding taxes, and
received delivery of such Shares as herein provided.

 

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7. Limitation on Exercise. The Nonqualified Stock Option shall not be
exercisable unless the offer and sale of the Shares subject thereto have been
registered under the Securities Act of 1933, as amended (the “1933 Act”), and
qualified under applicable state “blue sky” laws, or the Company has determined
that an exemption from registration under the 1933 Act and from qualification
under such state “blue sky” laws is available. The Company may require, as a
condition to the exercise of a Nonqualified Stock Option, that the Eligible
Participant make certain representations and warranties as to the Eligible
Participant’s investment intent with respect to the Shares.

8. Transferability.

(a) During the Eligible Participant’s lifetime, this Nonqualified Stock Option
shall be exercisable only by him and neither it nor any right thereunder shall
be transferable except by will or laws of descent and distribution (and shall be
exercisable by such transferee only as provided on Section 2 and 5 above), or be
subject to attachment, execution or other similar process. In the event of any
attempt by the eligible Participant to alienate, assign, pledge, hypothecate or
otherwise dispose of the Nonqualified Stock Option or any right hereunder,
except as provided for herein, or in the event of the levy of any attachment,
execution or similar process under the rights or interest hereby conferred, the
Committee may terminate the Nonqualified Stock Option by notice to the Eligible
participant, and the Nonqualified Stock Option shall thereupon become null and
void.

(b) The Company shall have the right to assign to any of its affiliates any of
its rights, or to delegate to any of its affiliates any of its obligations under
this Award Agreement.

9. Binding Effect. This Award Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective heirs, executors,
administrators, successors and assigns.

10. Gender and Number. All terms used in this Award Agreement shall be deemed to
refer to the masculine, feminine, neuter, singular or plural as to the context
may require.

11. Terms and Conditions of Plan. The terms and conditions included in the Plan
are incorporated by reference herein, and to the extent that any conflict may
exist between any term or provision of this Award Agreement and any term or
provision of the Plan as in effect from time to time, such term or provision of
the Plan shall control.

12. Certain Remedies. Without intending to limit the remedies available to the
Company, the Eligible Participant agrees that damages at law will be an
insufficient remedy in the event the Eligible Participant violates the terms of
this Award Agreement. The Eligible Participant agrees that the Company may apply
for and have injunctive or other equitable relief in any court of competent
jurisdiction to restrain the breach or threatened breach of, or otherwise
specifically to enforce, any of the provisions hereof.

 

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13. Notices. All notices and communications provided for herein shall be in
writing and shall be delivered by hand or sent by certified mail, return receipt
requested, postage prepaid, addressed, if to the Eligible Participant, to
his/her attention at the mailing address set forth at the foot of this Award
Agreement (or to such other address as the Eligible Participant shall have
specified to the Company in writing) and, if to the Company, to it at 3151 South
17th Street, Wilmington, North Carolina 28412, Attention: Chief Financial
Officer (or to such other address as the Company shall have specified to the
Eligible Participant in writing). All such notices shall be conclusively deemed
to be received and shall be effective if sent by hand delivery, upon receipt, or
if sent by registered or certified mail, on the fifth day after the day on which
such notice is mailed.

14. Waiver. The waiver by either party of compliance with any provision of this
Award Agreement by the other party shall not operate or be construed as a waiver
of any other provision of this Award Agreement, or of any subsequent breach by
such party of a provision of this Award Agreement.

15. No Restriction on Right of Company to Effect Corporate Changes. Neither the
Plan nor this Award Agreement shall affect any way the right of power of the
Company or its stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the capital structure or
business of the Company, or any merger or consolidation of the Company, or any
issue of stock or of options, warrants or rights to purchase stock or of bonds,
debentures, preferred or prior preference stocks whose rights are superior to or
affect the Common Stock or the rights thereof or which are convertible into or
exchangeable for Common Stock, or the dissolution or liquidation of the Company,
or any sale or transfer of all or any part of the assets or business of the
Company, or any other corporate act or proceeding, whether of a similar
character or otherwise.

16. Entire Agreement. This Award Agreement (including the Plan which is
incorporated herein by reference and all additional riders incorporated by
Section 12 above) sets forth all of the promises, agreements, conditions, and
understandings, between the parties hereto with respect to the Nonqualified
Stock Option and the Shares, and there are no promises, agreements, conditions,
understandings, warranties or representations, oral or written, express or
implied, between them with respect to the Nonqualified Stock Option or the
shares other than as set forth therein or herein. This Award Agreement
supersedes and replaces any and all prior agreements between the parties hereto
with respect to the Nonqualified Stock Option or the shares. This Award
Agreement is, and is intended by the parties to be, an integration of any and
all prior agreements or understandings, oral or written, with respect to the
Nonqualified Stock Option and the Shares.

 

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17. Invalid or Unenforceable Provision. The invalidity or unenforceability of
any particular provision of this Award Agreement shall not affect the other
provisions hereof, and this Award Agreement shall be construed in all respects
as if such invalid or unenforceable provision was omitted.

18. Governing Law. This Award Agreement shall be construed and enforced in
accordance with the laws of North Carolina, without giving effect to principles
of conflicts of laws.

19. Miscellaneous.

(a) Neither the granting of this Nonqualified Stock Option, the exercise thereof
nor any other provision of this Award Agreement shall be construed as conferring
upon the Eligible Participant any right to continue in the employment of the
Company, or as interfering with or restricting in any way the right of the
Company to terminate such employment at any time.

(b) The Company, the Committee and any employees or agents thereof are relieved
from any liability for the non-issuance or non-transfer, or any delay in the
issuance or transfer, of any of the Shares which results from the inability of
the Company to obtain, or in any delay in obtaining, from each regulatory body
having jurisdiction all requisite authority to issue or transfer the Common
Stock of the Company in satisfaction of this Nonqualified Stock Option if
counsel for the Company deems such authorization necessary for the lawful
issuance or transfer of any such Shares.

(c) No shares acquired by exercise of this Nonqualified Stock Option shall be
sold or otherwise disposed of in violation of any federal or state securities
law or regulations.

(d) This Nonqualified Stock Option shall be exercised in accordance with the
terms of the Plan and such administrative regulations as the Committee may from
time to time adopt. All decisions of the Committee with respect to the
interpretation, construction and application of the Plan and/or this Award
Agreement shall be conclusive and binding upon the Eligible Participant and all
other persons.

[NEXT PAGE IS SIGNATURE PAGE]

 

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IN WITNESS WHEREOF, the parties hereby have caused this Award Agreement to be
executed as of the day and year first above written.

 

(CORPORATE SEAL)   PHARMACEUTICAL PRODUCT DEVELOPMENT, INC.   By:  

 

    Fred N. Eshelman     Chief Executive Officer ATTEST:    

 

    B. Judd Hartman     Secretary    

 

ELIGIBLE PARTICIPANT:  

 

  (SEAL) Print Name:  

 

Address:  

 

 

 

 

 

 

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EXHIBIT A

Pharmaceutical Product Development, Inc.

3151 South 17th Street

Wilmington, NC 28412

Attention: COMPENSATION COMMITTEE

Re: Exercise of Nonqualified Stock Option

Dear Committee Members:

Pursuant to the terms and conditions of the Nonqualified Stock Option Award
Agreement dated as of                      (the “Award Agreement”) between
                     and Pharmaceutical Product Development, Inc. (the
“Company”), I hereby agree to purchase              shares of the Common Stock
of the Company and tender payment in full for such shares in accordance with the
terms of the Award Agreement.

 

Very truly yours,

 

Print Name:

Date:                     

 

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