**Exhibit 10.1**

 

 
| **Notice of Grant and Agreement  and Consent   under the 1998 IMS Health Incorporated   Employees Stock Incentive Plan** | ** ** | **IMS Health Incorporated** |
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|                                                                                                                     |       | ID: 06-1506026              |
|                                                                                                                     |       | 901 Main Avenue             |
|                                                                                                                     |       | Norwalk, CT  06851          |

 
| **THIS DOCUMENT CONSTITUTES PART OF A PROSPECTUS  COVERING SECURITIES THAT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF  1933** |
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| ** **                                                                                                                               |

 

IMS Health Incorporated (“IMS HEALTH” or the “Company”) hereby grantsto you a stock appreciation right (“Stock Appreciation Rights” or “SARs”) on             Sharesof the Company’s common stock at the exercise price per Share of$            .  This grant is effective as of                (the “Grant Date”).

 

Your SARs are granted under the 1998 IMS Health Incorporated Employees’Stock Incentive Plan (the “Plan”).  ThePlan is discretionary in nature and IMS Health may amend, cancel or terminatethe Plan at any time.  The grant of IMSHEALTH Stock Appreciation Rights is a one-time benefit solely offered toemployees and does not create any contractual or other right for you to receivea grant of IMS HEALTH stock appreciation rights or benefits in lieu of IMSHEALTH stock appreciation rights in the future. Future grants, if any, will be at the sole discretion of IMS HEALTH,including, but not limited to, the timing of any grant, the number of IMSHealth Stock Appreciation Rights, vesting provisions and the exercise price.

 

Each SAR entitles you, upon exercise, to an amount (the “StockAppreciation”) equal to (i) the excess of (A) the Fair Market Valueon the exercise date of one Share over (B) the exercise price per Share,times (ii) the number of Shares as to which you are exercising theSAR.  The future value of the underlyingIMS HEALTH Shares is unknown and cannot be predicted with certainty.  If the underlying IMS HEALTH Shares do notincrease in value, you will realize no value from your SARs.

 

Your SARs aresubject to and governed by the terms of the Plan. The provisions of the Planare incorporated into this Notice of Grant and Agreement and Consent(“Agreement”) by reference.  Allcapitalized terms used in this Agreement but not defined shall have themeanings set forth in the Plan.  In theevent the Plan and this Agreement are not consistent, the terms of theAgreement shall govern, including without limitation that the provisionsrelated to Termination of Employment as set out below shall prevail over anyinconsistent terms contained in the Plan. In addition, certain terms of your SARs may be specified in yourEmployment Agreement (the “Employment Agreement”), in which event the SARsshall be governed by the applicable terms of your Employment Agreement to theextent that such terms are more favorable. Any provision of the Employment Agreement applicable to stock options shallapply equally to SARs, and, if the Employment Agreement provides to you anyterms, conditions and rights with respect to stock options or SARs that aremore favorable to you than the applicable terms, conditions and rights of thePlan or this Agreement, the applicable terms, conditions and rights of the EmploymentAgreement shall control.  Conversely, ifthe Plan or this Agreement provides to you any terms, conditions and rightswith respect to stock options or SARs that are more favorable to you than theapplicable terms, conditions and rights of your Employment Agreement, theapplicable terms, conditions and rights of the Plan or this Agreement shallcontrol.  The SARs are intended to beNon-409A Awards.

 

Your participation in thePlan and your execution of this Agreement is voluntary.  The value of IMS HEALTH stock appreciationrights generally and your SARs specifically are an extraordinary item ofcompensation outside the scope of your Employment Agreement or other employmentcontract, if any.  As such, neither IMS Health stock appreciation rightsgenerally nor your SARs specifically are part of normal or expectedcompensation for purposes of calculating any termination, severance,resignation, redundancy, end of service payments, bonuses, long service awards,pension or retirement benefits, or similar payments.

 

 

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Your SARs and theterms thereof are subject to adjustment as provided under Section 10(a) ofthe Plan.

 

Vesting and StatedExpiration Date

 

Your SARs will vest infour equal annual installments on each of the first four anniversaries of theGrant Date if your employment with the Company or a Subsidiary continuesthrough the applicable vesting date; provided, however, that the SARswill vest earlier in full upon your Termination of Employment by the Companywithout Cause or by you for Good Reason, as the terms “Cause” and “Good Reason”are defined in your Employment Agreement or Change in Control Agreement, andupon a Change in Control as defined below. Your SARs will expire on the seventh anniversary of the Grant Date (the“Stated Expiration Date”), subject to earlier forfeiture or expiration asspecified in your Employment Agreement, the Plan and this Agreement.

 

Notwithstandinganything to the contrary in this Agreement, upon occurrence of a “Change inControl” (as such term is defined in your Employment Agreement or Change inControl Agreement), any unvested portion of your SARs not previously forfeitedor expired will become immediately exercisable.

 

#### Exercise of SARs

 

You may exercise yourSARs at such time as they have become vested only in accordance with the Plan,your Employment Agreement, and any procedures that the Committee may approvefrom time to time; provided, however, that, upon your termination of employmentby the Company without Cause or by you for Good Reason, as the terms “Cause”and “Good Reason” are defined in your Employment Agreement or Change in ControlAgreement, the SARs shall be exercisable thereafter (i), if such terminationoccurs simultaneously with or within 24 months following a Change in Control,until the Stated Expiration Date of the SARs, or (ii), if such termination isnot simultaneous with or within 24 months following a Change in Control, untilthe earlier of the Stated Expiration Date of the SARs or the fifth anniversaryof the date of such termination of employment (whereupon the SARs will expire).

 

The date on which anotice of exercise is received by the Company shall be the exercise date.  Payment shall be made to you upon exercise bydelivery of a number of Shares equal to the Stock Appreciation divided by theFair Market Value of one Share at the exercise date (subject to any applicabletax withholding, as specified below). SARs may be exercised from time to time upon actual receipt by theCompany of written notice of exercise stating the number of vested SARs beingexercised.  Notwithstanding theforegoing, the Company may in its sole discretion establish alternative meansto exercise SARs, including electronic forms using electronic signatures andinteractive voice response systems using PIN numbers, in a manner directed bythe Company, and your SARs shall be deemed to be exercised upon fulfillment ofsuch alternative means.  You may onlyexercise the SAR as to a given underlying Share one time.  Unless otherwise determined by the Company,no fractional Shares will be issued in payment upon exercise of SARs and thenumber of Shares to be delivered will be rounded downward to the nearest wholeShare.  Upon exercise, you shall be paid,in cash, an amount equal to the value of any fractional Share that would haveotherwise been payable at the time of exercise (after giving effect to anyShare withholding for mandatory taxes), unless the Company arranges to deliverShares to an account to which fractional Shares may be credited without requiringthe Company to in fact issue a fractional Share.

 

You may exerciseyour SARs at such time as they have become exercisable only in accordance withthe Plan and with any procedures that the Committee may set forth.  If the SARs remain outstanding but unexercisedat the Stated Expiration Date or any earlier applicable date on which the SARswould terminate, and if the Stock Appreciation at that date would be a positiveamount, the SARs, to the extent then exercisable, shall be automaticallyexercised.

 

 

 

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Termination of Employment

 

Provisions relating to vesting and post-termination exercise periodsapplicable to stock options, as specified in Section 7 of the Plan, shallapply equally to the SARs (including without limitationSection 7(e) relating to death and disability,Section 7(f) relating to Retirement, andSection 7(g) relating to other terminations), provided however,that the provisions of this Agreement addressing termination of your employmentby the Company without Cause or by you for Good Reason and the consequencesthereof (including without limitation provisions relating to vesting andpost-termination exercise of the SARs) shall prevail and control over anyinconsistent provisions contained in the Plan to the extent that the provisionsof this Agreement are more favorable to you. Notwithstanding anything to the contrary, to the extent that yourEmployment Agreement or Change in Control Agreement provides any terminationprovisions that are more favorable to you (including without limitationprovisions relating to vesting and post-termination exercise of options orSARs) than the Plan or this Agreement, such provisions of your EmploymentAgreement or Change in Control Agreement shall prevail and control, includingin the event of your termination by the Company without Cause  or by you for Good Reason or your terminationdue to death, disability or Retirement. Conversely, to the extent that the Plan or this Agreement provides anytermination provisions that are more favorable to you (including withoutlimitation provisions relating to vesting and post-termination exercise ofoptions or SARs) than your Employment Agreement or Change in Control Agreement,such provisions of the Plan or this Agreement shall prevail and control,including in the event of your termination by the Company without Cause  or by you for Good Reason or your terminationdue to death, disability or Retirement.

 

Exceptas otherwise provided herein, in connection with any termination of youremployment for any reason, whether such termination is occasioned by you, bythe Company or any of its Subsidiaries with or without cause, or by mutualagreement (“Termination of Employment”), any portion of the SARs not vested ator before Termination of Employment (or subject to non-forfeiture in the caseof Retirement) pursuant to Section 7 of the Plan will be forfeited.

 

You acknowledge and agree that you willhave no claim or entitlement (1) to compensation or damages in consequenceof the Termination of Employment with IMS Health or any of its Subsidiaries forany reason whatsoever and whether or not in breach of contract, insofar as suchclaim or entitlement arises or may arise from your ceasing to have any rightsunder the Plan or this Agreement, (2) to exercise your SARs as a result ofsuch Termination of Employment except as expressly provided in this Agreement,or (3) from the loss or diminution in value of your SARs; and, upon thegrant of your SARs and in partial consideration for your participation in thePlan and this Agreement, you shall be deemed irrevocably to have waived anysuch claim or entitlement.

 

Your sales ofShares acquired upon exercise of your SARs will be subject to applicablerestrictions under the Company’s policies regulating insider trading byemployees.

 

Nontransferabilityof Your SARs

 

Except as may be providedotherwise under the Plan, you cannot transfer, give, assign, sell, encumber, orin any way transfer or alienate your SARs to anyone except after your death byyour will or by applicable inheritance laws, and during your lifetime your SARsshall be exercisable only by you or your legal representative.

 

Tax Withholding

 

It shall be acondition to the obligation of the Company to issue and deliver Shares uponexercise of the SARs that you (or any Beneficiary) pay to the Company (or asubsidiary or affiliate), upon its demand, such amount as may be requested bythe Company for the purpose of satisfying the minimum statutory withholdingliabilities for federal, state, or local income and other taxes.  Unless otherwise determined by the Committee,the Company shall withhold from the Shares to be delivered upon exercise of theSARs that number of Shares having a fair market value equal to the amount ofsuch withholding tax liability (or as nearly equal as possible withoutexceeding the amount of such tax liability). For this purpose, the fair market value of the withheld Shares shall bethe average high/low sales prices in composite trading of New York StockExchange-listed securities on the day on which the Shares are withheld.

 

 

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Forfeiture of Unexercised Portion of Your SARs andCertain Gain

 

The greatest assets of IMS HEALTH and its affiliates (each, an “IMSHEALTH Company”) are its employees, technology and customers.  In recognition of the increased risk ofunfairly losing any of these assets to its competitors, IMS HEALTH has adoptedthe following policy:

 

If you directly or indirectly engage in any of the “DetrimentalActivities” defined below:

 
|   | (a)    |   | any unexercised portion of your SARs shall automatically  expire (regardless of vesting) on the later of the date of your Termination  of Employment or the date IMS HEALTH becomes aware of your Detrimental  Activity; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
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|   | (b)    |   | you shall forfeit to the Company the Shares acquired  upon any exercise of your SARs by you during the one year prior to, or at any  time after, the date of the earliest actual occurrence of your Detrimental  Activity (the “Forfeiture Period”). Such Shares shall be forfeited by you and  payable to the Company at the later of (i) the date of your Termination  of Employment or (ii) the date of your Detrimental Activity. If you have  disposed of the Shares during the Forfeiture Period, your obligation to repay  Shares upon such forfeiture will continue (payment of cash or other property  is not permitted), so that you will be required to acquire replacement Shares  and deliver them to the Company in settlement of your forfeiture obligation  without regard to any subsequent market price increase or decrease from the  date of exercise. If you fail to promptly deliver forfeited Shares and if,  apart from and independent of this Agreement, the Company is obligated to pay  any cash amount to you, the Company, as a setoff, may use such cash to  purchase Shares in the open market on your behalf, which Shares will be  retained by the Company in settlement of your forfeiture obligation  hereunder. |

 

DetrimentalActivities are defined as:

 
|   | · | using or disclosing any information that has been  treated by an IMS HEALTH Company as confidential or proprietary and is of  competitive advantage to such IMS HEALTH Company, unless you are using or  disclosing it in the course of your job with such IMS HEALTH Company;                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
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|   | · | during the period beginning the Grant Date and  ending twelve months after you leave your employment with any IMS HEALTH  Company (the “Prohibited Period”), soliciting, inducing, enticing or  procuring for anyone other than an IMS HEALTH Company the trade or business  of any entity that was a customer (including “near-permanent” customers),  prospective customer or data supplier of an IMS HEALTH Company, in order to  sell to such customer or prospective customer, or obtain from such data  supplier, the same, similar or related services IMS HEALTH offers to its  customers, or such data supplier provided to IMS HEALTH, during the period  that you worked for any IMS HEALTH Company; |
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|   | · | during the Prohibited Period, soliciting, inducing,  enticing or procuring any employee of any IMS HEALTH Company to leave his or  her employment; or employing or otherwise using the services of any person  who is or was an IMS HEALTH Company employee during the last twelve months  that you worked for an IMS HEALTH Company; or                                                                                                                                                                                                                                                                                                                                                                                            |
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|   | · | during the Prohibited Period, directly or indirectly  (including without limitation as an officer, director, employee, advisor,  agent, consultant or investor, other than by the ownership of a passive  investment interest of not more than 1% in a company with publicly traded  equity securities), (i) seeking or accepting any employment or other  work with or providing assistance to any person or entity that offers  Competitive Services (as defined below) to any person or entity that was a  customer or potential customer of any IMS HEALTH Company at any time during  the last two years of your employment with any IMS HEALTH Company, or  (ii) otherwise providing Competitive Services.          |

 

For purposes hereof,“Competitive Services” means engaging in the following activities anywhere in 

 

 

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the world in relation tothe pharmaceutical and healthcare industries (it being understood that theglobal market in which any of the businesses of IMS is conducted and to whichtheir goodwill extends is not limited to any particular region in the world andthat given the informational nature of such businesses, they may be engagedeffectively from any location in the world):

 
|   | · | providing information services for the management of  sales forces engaged in the sale of prescription or over-the-counter drugs,  medical devices, or medical or surgical products;                                                                                                                                                                                                                                                                                                             |
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|   | · | providing information services for the measurement  of sales force performance or product performance for prescription or  over-the-counter drugs, medical devices, or medical or surgical products;                                                                                                                                                                                                                                                                                             |
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|   | · | creating or providing physician profiles for  purposes of assisting others in the targeting of promotion or sales  activities in relation to prescription or over-the-counter drugs, medical  devices, or medical or surgical products;                                                                                                                                                                                                                                                          |
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|   | · | creating or providing micromarketing programs based  on prescribing behavior or attitudes of physicians or other prescribers in  relation to prescription or over-the-counter drugs, medical devices, or  medical or surgical products;                                                                                                                                                                                                                                                          |
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|   | · | creating or providing market research reports or  audits relating to the use, sale, marketing/promotion, distribution or warehousing  of any prescription or over-the-counter drugs, medical devices, or medical or  surgical products;                                                                                                                                                                                                                                                          |
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|   | · | using or developing technology, methodologies or  processes which have functionality or produce results similar to the  technology, methodologies or processes employed or offered by IMS HEALTH to  process pharmaceutical or healthcare information, including but not limited  to internal processing technology, decision support tools, data warehousing  applications and data mining applications;                                                                                        |
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|   | · | creating or providing reference files,  classification schemes, master files or other methods of categorizing,  classifying, organizing or identifying products, procedures, medical  facilities, pharmacies, warehouses, distributors, prescribers, pharmacists or  other entities, activities or persons associated with the use, sale,  marketing/promotion, distribution or warehousing of any prescription or  over-the-counter drugs, medical devices, or medical or surgical products; or |
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|   | · | providing market research consulting, sales  management consulting, information technology consulting or market event  management consulting, or any other consulting services in connection with  any of the foregoing activities or otherwise relating to the use, sale,  marketing/promotion, distribution or warehousing of any prescription or  over-the-counter drugs, medical devices, or medical or surgical products.                                                                   |

 

*Byaccepting your SARs, you consent to a deduction from any amounts the Company oryour employer owes you from time to time equal to the forfeiture amount, to theextent such deduction is permitted by applicable law.  Any such deduction from an amount thatconstitutes a deferral of compensation under Code Section 409A may onlytake place at the time the amount would otherwise be payable to you.*

 

Governing Law

 

THEPLAN AND THIS AGREEMENT SHALL BE GOVERENED BY THE LAWS OF THE STATE OF NEW YORKAND ANY APPLICABLE FEDERAL LAWS. INTERPRETATION OF THE PLAN AND THIS AGREEMENT SHALL BE GOVERENED BY THELAWS OF THE STATE OF NEW YORK AND ANY APPLICABLE FEDERAL LAWS.

 

ANY LEGAL PROCEEDING ARISING OUT OF THIS PLAN ORTHIS AGREEMENT SHALL BE BROUGHT EXCLUSIVELY IN THE FEDERAL OR STATE COURTSLOCATED IN THE STATE OF NEW YORK.  YOUAGREE TO SUBMIT TO PERSONAL JURISDICTION AND TO VENUE IN THOSE COURTS.  YOU FURTHER AGREE TO WAIVE ALL LEGALCHALLENGES AND DEFENSES TO THE APPROPRIATENESS OF NEW YORK AS THE SITE OF ANYSUCH LEGAL PROCEEDING AND TO THE APPLICATION OF THE LAWS OF THE STATE OF NEWYORK AND ANY APPLICABLE FEDERAL LAWS.

 

 

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IntendedAccounting Treatment; Reform of Contract

 

TheCompany intends that your SARs shall qualify for fixed accounting under FAS123R, with the compensation measurement date for accounting purposes to occurat the Grant Date, unless the Committee specifically determines otherwise.  Therefore, other provisions of this Agreementnotwithstanding, in order to preserve this fundamental objective of your SARs,if any provision of this Agreement or otherwise applicable to your SARs wouldresult in “variable” accounting or a measurement date other than the GrantDate, if the Committee was not specifically aware of such accountingconsequence at the time such provision became effective, such provision shallbe modified and reformed to the extent necessary to preserve the accountingtreatment of your SARs intended by the Committee.

 

Acknowledgements and Acceptance

 

You voluntarily acknowledge and consentto the collection, use, processing and transfer of personal data as describedin this paragraph.  You are not obligedto consent to such collection, use, processing and transfer of personaldata.  However, failure to provide theconsent may affect your ability to participate in the Plan.  IMS HEALTH, its Subsidiaries and youremployer hold certain personal information about you, including your name, homeaddress and telephone number, date of birth, social insurance number or otheremployee identification number, salary, nationality, job title, any Shares ofstock or directorships held in IMS HEALTH, details of your SARs, all IMS Healthstock options or any other rights or entitlements to Shares of stock in yourfavor, for the purpose of managing and administering the Plan (“Data”).  IMS HEALTH and/or its Subsidiaries willtransfer Data amongst themselves as necessary for the purpose ofimplementation, administration and management of your participation in thePlan, and IMS HEALTH and/or any of its Subsidiaries may each further transferData to any third parties assisting IMS HEALTH in the implementation,administration and management of the Plan. These recipients may be located in the European Economic Area, orelsewhere throughout the world, such as the United States.  You authorize them to receive, possess, use,retain and transfer the Data, in electronic or other form, for the purposes ofimplementing, administering and managing your participation in the Plan,including any requisite transfer of such Data as may be required for theadministration of the Plan and/or the subsequent holding of Shares on yourbehalf to a broker or other third party with whom you may elect to deposit anyShares acquired pursuant to the Plan. You may, at any time, review Data, require any necessary amendments toit or withdraw the consents herein in writing by contacting IMS HEALTH;however, withdrawing your consent may affect your ability to participate in thePlan.  You acknowledge and agree thatyour consent shall apply to any and all awards of stock appreciation rightsmade to you under the Plan or this Agreement, whether now or in the future.

 

You do not need todo anything if you want to accept your SAR(s) on the terms set out in thisAgreement.  It would however help us ifyou would sign this Agreement in the space indicated below and return a copy tous by mail to:

 

Equity Programs

Shared Business Services

861 Marcon Boulevard

Allentown, Pennsylvania 18109

U.S.A.

 

Ifyou do not want to accept your SAR(s) on the terms set out in thisAgreement, the Plan and all related documents, please notify us of yourrejection of the SAR(s) by writing to the Company at the above address,marking your envelope to the attention of                          ,no later than                             .  Your SAR(s) will then be cancelled.  If you do not write to us telling us that youdo not want your SAR(s) by                               ,you will be deemed to have accepted your SAR(s) and to agree to the termsset out in this Agreement.

 

Copies of the Plan and suchrelated documents are being provided to you as part of this Agreement.

 

 

 

**IMSHEALTH INCORPORATED**

 

David R. Carlucci

Chairman and Chief Executive Officer

 

 

 

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