Ex-10.06



 



EXHIBIT 10.06


(Quintiles Transnational Corp. Logo)


	 	 	 	 
	 	 	

Quintiles Transnational Corp.

Post Office Box 13979

Research Triangle Park, NC 27709-3979

919 998 2000/fax 919 998 9113

http://www.quintiles.com 

	 
	 	 	January 21,2004
	 
	 	 	CONFIDENTIAL
	 
	 	 	James L. Bierman

P.O. Box 6834
	 	 	Shallotte, North Carolina 28470
	 
	 	 	Re: Remaining Employment with Quintiles Transnational
Corporation and Its
Affiliates
	 
	 	 	Dear Jim:
	 
	 	 	This letter (“Letter Agreement”) outlines the arrangements
regarding the remainder of your employment with Quintiles
Transnational Corporation (the “Company”), as follows:
	 
	 	 	1.	Term of Employment. The Company agrees
to employ you, and you agree to remain employed by
the Company, through June 30, 2004 (the “Scheduled
Termination Date”), at which time you will resign
from employment and all positions with the Company
and its affiliates. You agree that thereafter, you
will not represent yourself to be associated in any
capacity with the Company. Your employment may be
terminated by the Company prior to the Scheduled
Termination Date only for Cause, which, for purposes
of this Letter Agreement, means your (i) willful and
material breach of this Letter Agreement, including,
without limitation, paragraph 5 below, that has
continued uncorrected for thirty days following your
receipt of written notice thereof from the Company,
(ii) material failure or refusal to timely perform
the duties of your employment (other than by reason
of a physical or mental illness or impairment) that,
to the extent correctable, has continued uncorrected
for thirty days following your receipt of written
notice thereof from the Company, or your gross
negligence in the performance of your duties,
provided that for purposes of this clause (ii), your
failure to meet performance expectations after your
good faith efforts to do so, shall not constitute a
material failure to perform your duties, or (iii)
conviction of, or plea of guilty or nolo contendere
to, a crime involving



 






 



(Quintiles Transnational Corp. Logo)




	 	 	 	moral turpitude, dishonesty, fraud or unethical business
conduct, or any felony of any nature whatsoever. The date
of your actual termination of employment is hereinafter
referred to as the “Termination Date”.




	 	2.	 	Duties.




	 	a.	 	During your remaining employment, you shall
perform such duties as may be
assigned to you by the Company consistent with your position
as Chief Financial
Officer or with the transition of your duties to a successor
Chief Financial Officer.
To the extent requested, you will assist in the process of
identifying and recruiting
a replacement for your position, and transitioning your
duties to any person so
hired,
	 
	 	b.	 	At any time prior to the Scheduled Termination
Date, the Company may relieve
you of any or all of your duties, and reduce or eliminate
the time during which
you are required to be physically present at the office.
Any such action by the
Company shall not be construed as a termination of your
employment for
purposes of this Letter Agreement or be deemed to make the
Termination Date for
purposes of this letter to be any date other than the
Scheduled Termination Date,
or relieve you or the Company of your and its respective
other obligations under
this Letter Agreement except for the performance of your
duties under paragraph
2(a) above.




	 	3.	 	Payments and Benefits. In respect of your remaining
employment with the Company,
you will be entitled to receive only the following payments and
benefits (in each case
subject to applicable tax withholding);




	 	a.	 	Signing Bonus. As soon as practicable following
your acceptance of this Letter
Agreement, you will be paid $500,000 in a lump sum.
	 
	 	b.	 	Base Salary. From January 1, 2004 until the
termination of your employment,
you will be paid a base salary at the rate of $550,000.
	 
	 	c.	 	Benefits.




	 	(i)	 	You will be entitled to continue to
participate in the Company’s Employee Stock
Ownership and 401(k) Plan, Elective Deferred
Compensation Plan, and group insurance programs
until your Termination Date. You will also be
entitled to 10 business days of paid vacation leave
and all company holidays. In addition, you will be
reimbursed in accordance with and subject to the
Company’s reimbursement policy for reasonable and
necessary expenses you incur in connection with your
employment by the Company through your Termination
Date.



 






 



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	 	(ii)	 	If you remain employed until the
Scheduled Termination Date, you may elect to
continue to participate in the Company’s group
health plan for a period of 18 months thereafter on
the same basis that you participated immediately
prior to your Termination Date, provided that such
continued coverage will end on the date that you
become entitled to comparable group coverage. If
your continued participation in such plan is barred
by the terms of such plan, the Company will
reimburse you for the amount by which the cost of
comparable coverage you obtain on commercially
reasonable terms exceeds the cost you bore for such
plan prior to the Termination Date. For purposes of
clarification, the continued group health coverage
called for under this paragraph beyond your
Termination Date shall constitute continuation
coverage under the Consolidated Omnibus Budget
Reconciliation Act of 1985 (COBRA). Upon your
Termination Date, any vested benefits that you have
accrued under the Company’s Employee Stock Ownership
and 401 (k) Plan, or Elective Deferred Compensation
Plan will be payable to you in accordance with the
terms of those plans.




	 	d.	 	Retention Bonus. If you remain employed through
your Scheduled Termination Date, or, if prior thereto,
your employment terminates by reason of your death or
disability entitling you to benefits under the Company’s
long term disability plan, you (or your estate) will
receive a payment of $4,215,582, which will be payable as
follows:




	 	-	 	$2,400,000 payable on the date of the
Company’s receipt of the confirmation referred
to in clause (iii) of paragraph 6 below;
	 
	 	-	 	$1,200,000 payable on July 31, 2004; and
	 
	 	-	 	$615,582 payable on December 31,2004.




	 	4.	 	Cessation of all other Compensation and Benefits. You
will not receive compensation, payments or benefits of any
kind from the Company or its affiliates other than those set
forth in paragraph 3 above, and you expressly acknowledge and
agree that, except with respect to the payments and benefits
specifically set forth in this Letter Agreement, you are not
entitled to any compensation, payment or benefit from the
Company or its affiliates whatsoever, including, without
limitation, any right to payments or benefits under the
Executive Employment Agreement between you and the Company,
dated June 16, 1998, and amended March 31, 2003 (the
“Employment Agreement”), the Company’s Executive Compensation
Plan, its stock option plans, and its Special Bonus Plan.
Except as specifically provided in paragraphs 5 and 7 below,
this Letter Agreement shall
supersede the Employment Agreement, which shall be of no
further force and effect.



 






 



(Quintiles Transnational Corp. Logo)




	 	5.	 	Restrictive Covenants. The covenants and agreements made
by you in Sections 6, 7, 8
and 9 of your Employment Agreement shall remain in full force and
effect in accordance
with their terms, and for purposes thereof, any action taken by
the Company pursuant to
paragraph 2(b) above shall not be treated as a termination of your
employment, provided
that you agree that the one year period referred to in Section 6.3
of your Employment
Agreement (Competitive Business Activities) will be extended to a
13 month period.
You acknowledge that your right to receive and retain the payments
and benefits referred
to in clauses (a), (c)(ii) and (d) of paragraph 3 above is
conditional upon your material
compliance with Section 6.1 and your compliance with Section 6.3
of the Employment
Agreement (as modified pursuant to the proviso in the preceding
sentence).
	 
	 	6.	 	Release. In order to be entitled to the payments and
benefits set forth in clauses (c)(ii) and (d) of paragraph 3 above, and in consideration therefor, you
(or your estate) must (i) deliver a signed and dated copy of the attached Release no earlier
than June 30, 2004 and no later than July 22, 2004, (ii) not subsequently revoke your
execution of such Release, and (iii) deliver no earlier than 8 days after your execution of
the Release a written confirmation that you (or your estate) have not revoked the
Release.
	 
	 	7.	 	Indemnification. The provisions of Section 11 of your
Employment Agreement shall remain in full force and effect in accordance with their terms. In
addition, the Company has determined that no excise tax will be payable by you pursuant
to section 4999 of the Internal Revenue Code (the “Excise Tax”) by reason of the payments
to be made to you under this Letter Agreement, and you agree to take a position
consistent with that of the Company at all times in respect of the applicability of the Excise
Tax. If it is subsequently determined by the Internal Revenue Service (“IRS”) on
audit that you are in fact subject an Excise Tax, then the Company will pay to you an
amount that, after taking into account all income, social security, Medicare and excise
taxes, is equal to such Excise Tax. The Company, at its cost, may, on your behalf,
challenge any assessment or imposition of any Excise Tax by the IRS, and you agree to assist
and cooperate with the Company with respect to any such challenge. Should you receive a
refund of any Excise Tax previously paid, you agree to repay to the Company the portion
of any payment made pursuant to this paragraph 7 in respect of the Excise Tax so
refunded.
	 
	 	8.	 	Miscellaneous: Choice of Law. This Letter Agreement
may be executed in several
counterparts, each or which shall be deemed to be an original but
all of which together
will constitute one and the same instrument. This Letter Agreement
constitutes the entire
agreement, and supersedes all prior agreements, of the parties
hereto relating to the
subject matter hereof, and there are no written or oral terms or
representations made by
either party other than those contained herein and therein. This
Letter Agreement cannot
be modified, altered or amended except by a writing signed by all
the parties. No waiver
by either party of any provision or condition of this Letter
Agreement at any time shall be
deemed a waiver of such provision or condition at any prior or
subsequent time or of any
provision or condition at the same or any prior or subsequent
time. This Letter



 






 



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	 	 	 	Agreement and attached Release shall be governed by and construed
in accordance with the domestic laws of the State of North
Carolina, except to the extent preempted by federal law, without
giving effect to any choice of law or conflict of law provision or
rule (whether of the State of North Carolina or any other
jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of North Carolina. You consent to
jurisdiction in North Carolina for the purpose of any litigation
relating to this Letter Agreement and attached Release and agree
that any such litigation shall be conducted in the courts of Wake
County, North Carolina or the federal courts of the United States
for the Eastern District of North Carolina.




	 	9.	 	Notices. Signed and dated copies of this Letter
Agreement, the Release, or any
revocation or confirmation of non-revocation of the Release should be
sent by mail,
courier, or facsimile to:




	 	 	 
	 	 	
Michael Mortimer
	 	 	
Executive Vice President,
	 	 	
  Global Human Resources
	 	 	
Quintiles Transnational Corp.
	 	 	
4709 Creekstone Drive
	 	 	
Riverbirch Building
	 	 	
Durham, NC 27703
	 	 	
(919) 998-2068 (tel)
	 	 	
(919) 998-2750 (fax)
	 	 	
Mike.Mortimer@Quintiles.com




	 	 	 
	With a copy to:	 	
Gary Rothstein, Esq.
	 	 	
Morgan Lewis & Bockius, LLP
	 	 	
101 Park Avenue
	 	 	
New York, NY 10178
	 	 	
(212) 309-6360 (tel)
	 	 	
(877) 432-9652 (fax)
	 	 	
grothstein@morganlewis.com




	 	10.	 	Confidentiality. You agree not to disclose or discuss in
any way the terms of this Letter
Agreement and attached Release, and represent that you have not
previously discussed or
disclosed any drafts or negotiations related thereto, with anyone
other than members of
your immediate family, or your personal counsel or financial advisors
(and you will
advise such persons of the confidential nature of these documents),
provided that your
obligations under this paragraph 10 will cease if and when the
Company files this Letter
Agreement with the Securities and Exchange Commission.
	 
	 	11.	 	No Set Off. The obligations of the Company to make and
provide the payments and
benefits described in paragraph 3(d) of this Letter Agreement shall
be subject solely to



 






 



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	 	 	 	you satisfying the conditions contained in paragraphs 3(d) and
6, and your continued material compliance with Section 6.1 and
continued compliance with Section 6.3 of the Employment
Agreement (as modified pursuant to the proviso in the first
sentence of paragraph 5 above), but shall otherwise be absolute
and unconditional and shall not be affected by any
circumstances, including, without limitation, any set-off,
counterclaim, recoupment, defense or other right which the
Company or any of its affiliates may have against you. You are
not be required to mitigate the amount of the payments
described in paragraph 3 by seeking other employment or
otherwise, nor shall the amount of such payments be reduced by
any compensation earned by you as the result of employment by
another company, by your retirement benefits or otherwise.
	 
	 	12.	 	Acknowledgement. By signing this Letter Agreement
and attached Release, you certify that you have read the
terms of this Letter Agreement and Release, and that your
execution of this Letter Agreement and Release shall
indicate that this Letter Agreement and Release conforms to
your understanding and is acceptable to you as a final
agreement. You further acknowledge and agree that you have
been advised of the opportunity to consult with counsel of
your choice and that you have been given a reasonable and
sufficient period of time in which to consider and return
this Letter Agreement and attached Release.
	 
	 	 	 	Sincerely,
	 
	 	 	 	

Michael Mortimer
	 	 	 	Executive Vice President, Global Human Resources
	 
	 	 	 	ACCEPTED AND AGREED
	 
	 	 	 	

	 
	 	 	 	Date: 1.21.04