Exhibit 10.2


 


IMS HEALTH INCORPORATED


 


EXECUTIVE ANNUAL INCENTIVE PLAN


 


As Amended and Restated December 16, 2008


 


1.  Purpose of the Plan


 


The
purpose of the Plan is to advance the interests of the Company and its
stockholders by providing incentives in the form of periodic cash bonus awards
to certain management employees of the Company and its subsidiaries, thereby
motivating such employees to attain corporate performance goals articulated
under the Plan.


 


2.  Definitions


 


The
following capitalized terms used in the Plan have the respective meanings set
forth in this Section:


 


(a) Act:
The Securities Exchange Act of 1934, as amended, or any successor thereto.


 


(b) Award:
A periodic cash bonus award granted pursuant to the Plan.


 


(c) Beneficial
Owner: As such term is defined in Rule 13d-3 under the Act (or any
successor rule thereto).


 


(d) Board:
The Board of Directors of the Company.


 


(e) Change
in Control: The occurrence of any of the following events:


 


(i)            any Person
(other than the Company, any trustee or other fiduciary holding securities
under an employee benefit plan of the Company, or any company owned, directly
or indirectly, by the stockholders of the Company in substantially the same
proportions as their ownership of stock of the Company), becomes the Beneficial
Owner, directly or indirectly, of securities of the Company representing 20% or
more of the combined voting power of the Company’s then-outstanding securities;


 


(ii)           during any
period of twenty-four months (not including any period prior to the Effective
Date), individuals who at the beginning of such period constitute the Board,
and any new director (other than (A) a director nominated by a Person who
has entered into an agreement with the Company to effect a transaction
described in Sections (2)(e)(i), (iii) or (iv) of the Plan, (B) a
director nominated by any Person (including the 


 

















 


Company)
who publicly announces an intention to take or to consider taking actions
(including, but not limited to, an actual or threatened proxy contest) which if
consummated would constitute a Change in Control or (C) a director
nominated by any Person who is the Beneficial Owner, directly or indirectly, of
securities of the Company representing 10% or more of the combined voting power
of the Company’s securities) whose election by the Board or nomination for
election by the Company’s stockholders was approved in advance by a vote of at
least two-thirds (2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or nomination for
election was previously so approved, cease for any reason to constitute at
least a majority thereof;


 


(iii)          the
stockholders of the Company approve any transaction or series of transactions
under which the Company is merged or consolidated with any other company, other
than a merger or consolidation (A) which would result in the voting
securities of the Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity) more than 66 2/3% of the combined voting
power of the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation and (B) after
which no Person holds 20% or more of the combined voting power of the
then-outstanding securities of the Company or such surviving entity; or


 


(iv)          the
stockholders of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the Company of all or
substantially all of the Company’s assets.


 


(f) Code:
The Internal Revenue Code of 1986, as amended, or any successor thereto.


 


(g) Committee:
The Human Resources Committee of the Board.


 


(h) Company:
IMS Health Incorporated, a Delaware corporation.


 


(i) Covered
Employee: As such term is defined in Section 162(m) of the Code (or
any successor section thereto).


 


(j) Covered
Participant: A Participant who is, or who is anticipated to become, a Covered
Employee.


 


(k) Effective
Date: The date on which the Plan takes effect, as defined pursuant to Section 13
of the Plan.


 

















 


(l) Participant:
An employee of the Company or any of its Subsidiaries who is selected by the
Committee to participate in the Plan pursuant to Section 4 of the Plan.


 


(m) Performance
Period: The calendar year or any other period that the Committee, in its sole
discretion, may determine.


 


(n) Person:
As such term is used for purposes of Sections 13(d) or 14(d) of the
Act (or any successor sections thereto).


 


(o) Plan:
The IMS Health Incorporated Executive Annual Incentive Plan.


 


(p) Shares:
Shares of common stock, par value $0.01 per Share, of the Company.


 


(q) Subsidiary:
A subsidiary corporation, as defined in Section 424(f) of the Code
(or any successor section thereto).


 


3.  Administration


 


The
Plan shall be administered by the Committee or such other persons designated by
the Board.  The Committee may delegate
its duties and powers in whole or in part to any subcommittee thereof
consisting solely of at least two individuals who are each “non-employee
directors” within the meaning of Rule 16b-3 of the Act (or any successor rule thereto)
and “outside directors” within the meaning of Section 162(m) of the
Code (or any successor section thereto). 
The Committee shall have the authority to select the employees to be
granted Awards under the Plan, to determine the size and terms of an Award
(subject to the limitations imposed on Awards in Section 5 below), to
modify the terms of any Award that has been granted (except for any modification
that would increase the amount of the Award payable to a Covered Participant),
to determine the time when Awards will be made and the Performance Period to
which they relate, to establish performance objectives in respect of such
performance periods and to certify that such performance objectives were
attained; provided, however, that any such action shall be consistent with the
applicable provisions of Section 162(m) of the Code.  The Committee is authorized to interpret the
Plan, to establish, amend and rescind any rules and regulations relating
to the Plan, and to make any other determinations that it deems necessary or
desirable for the administration of the Plan. 
The Committee may correct any defect or supply any omission or reconcile
any inconsistency in the Plan in the manner and to the extent the Committee
deems necessary or desirable.  Any
decision of the Committee in the interpretation and administration of the Plan,
as described herein, shall lie within its sole and absolute discretion and
shall be final, conclusive and binding on all parties concerned.  Determinations made by the Committee under
the Plan need not be uniform and may be made selectively among Participants,
whether or not such Participants are similarly situated.  The Committee shall have the right to deduct
from any payment made under the Plan any federal, state, local or foreign
income or other taxes required by law to be withheld with respect to such
payment.  To the extent consistent with
the applicable provisions of Section 162(m) of the Code, the
Committee 


 

















 


may
delegate to one or more employees of the Company or any of its Subsidiaries the
authority to take actions on its behalf pursuant to the Plan.


 


4.  Eligibility and Participation


 


The
Committee shall designate those persons who shall be Participants for each
Performance Period.  Participants shall
be selected from among the employees of the Company and any of its Subsidiaries
who are in a position to have a material impact on the results of the
operations of the Company or of one or more of its Subsidiaries.  The designation of Participants may be made
individually or by groups or classifications of employees, as the Committee
deems appropriate.


 


5.  Awards


 


(a) Performance
Goals.  A Participant’s Award shall be
determined based on the attainment of written performance goals approved by the
Committee for a Performance Period established by the Committee (i) while
the outcome for that Performance Period is substantially uncertain and (ii) no
more than 90 days after the commencement of the Performance Period to which the
performance goal relates or, if less than 90 days, the number of days which is
equal to 25 percent of the relevant Performance Period.  The performance goals, which must be
objective with respect to Covered Participants, shall be based upon one or more
of the following criteria: (i) consolidated earnings before or after taxes
(including earnings before interest, taxes, depreciation and/or amortization); (ii) net
income; (iii) operating income; (iv) earnings per Share; (v) book
value per Share; (vi) return on stockholders’ equity; (vii) expense
management; (viii) return on investment; (ix) improvements in capital
structure; (x) profitability of an identifiable business unit or product;
(xi) maintenance or improvement of profit margins; (xii) stock price; (xiii)
market share; (xiv) revenues or sales; (xv) costs; (xvi) cash flow; (xvii)
working capital; (xviii) return on assets; (xix) economic value created;
(xx) total shareholder return (stock price appreciation plus dividends and
distributions); (xxi) operating management goals; (xxii) execution of
pre-approved corporate strategy, (xxiii) operating margin and
(xxiv) measures of customer satisfaction and employee satisfaction.  In addition, with respect to Participants who
are not Covered Participants, the Committee may approve performance goals based
on other criteria, which may or may not be objective.  The foregoing criteria may relate to the
Company, one or more of its Subsidiaries or one or more of its divisions,
units, partnerships, joint venturers or minority investments, product lines or
products or any combination of the foregoing, and may be applied on an absolute
basis and/or be relative to one or more peer group companies or indices, or any
combination thereof, all as the Committee shall determine.  In addition, to the degree consistent with Section 162(m) of
the Code (or any successor section thereto), the performance goals may be
calculated without regard to extraordinary items.  The maximum amount of an Award to any
Participant with respect to a fiscal year of the Company shall be $3,000,000.


 


(b) Payment.  The Committee shall determine whether, with
respect to a Performance Period, the applicable performance goals have been met
with respect to a 


 

















 


given
Participant and, if they have, to so certify and ascertain the amount of the
applicable Award.  No Awards will be paid
for such Performance Period until such certification is made by the
Committee.  The amount of the Award
actually paid to a given Participant may be less or, with respect to
Participants who are not Covered Participants, more than the amount determined
by the applicable performance goal formula, at the discretion of the
Committee.  In all cases, the Committee’s
determination under this Section 5(b) shall be made, and resulting
Awards paid, between January 1 and March 15 following the end of a
Performance Period that ends on the last day of the Company’s fiscal year, and
shall be made within 75 days following the end of any Performance Period ending
at a date other than the last day of the Company’s fiscal year, unless the
Committee, at the time the performance goals were set, specified a different
date for payment (compliant with Code Section 409A).


 


(c) Termination
of Employment.  If a Participant who is
not a Covered Participant dies, retires, is assigned to a different position,
is granted a leave of absence, or if the Participant’s employment is otherwise
terminated (except with cause by the Company) during a Performance Period, a
pro rata share of the Participant’s award based on the period of actual
participation may, at the Committee’s discretion, be paid to the Participant
after the end of the Performance Period if it would have become earned and
payable had the Participant’s employment status not changed.  The Committee may, in its discretion,
authorize other payment terms relating to termination of employment, provided
that, in the case of an Award that constitutes a deferral of compensation under
Code Section 409A, if the timing of payment relates to the termination of
employment, then termination of employment means a “separation from service” as
defined in Treasury Regulation § 1.409A-1(h).


 


(d) Compliance
with Section 162(m) of the Code. 
The provisions of this Section 5 shall be administered and
interpreted in accordance with Section 162(m) of the Code to ensure
the deductibility by the Company or its Subsidiaries of the payment of Awards.


 


(e) Compliance with Section 409A of the Code.  Any vesting and payment of Awards provided
for hereunder or in a separate agreement between the Participant and the
Company shall be subject to the rules for compliance with Code Section 409A
set forth in Section 17 of the 1998 Employees’ Stock Incentive Plan (the “ESIP”),
and to the terms and provisions of such separate agreement.  Except for provisions necessary to ensure
compliance with Code Section 409A, any terms and provisions of such a
separate agreement (approved by the Board or an authorized committee of the
Board) shall take precedence over inconsistent terms of this Plan and, with
respect to such Participant, shall be deemed to amend and supersede this
Plan.  All other applicable provisions of
Section 17 of the ESIP, including Section 17(i) (providing for
reimbursement if tax penalties under Section 409A are imposed on
Participants) and Exhibit A to the ESIP (setting forth applicable rules if
elective deferrals were to be permitted), shall apply to Awards and rights
relating to Awards under this Plan.


 

















 


(f)  Award Pool.  The
Committee may establish an Award pool, which shall be an unfunded pool, for
purposes of measuring performance in a specified Performance Period for
purposes of Awards.  The amount of such
Award pool shall be based upon the achievement of a performance goal or goals
based on one or more of the business criteria set forth in Section 5(a) during
the given Performance Period, as specified by the Committee.  The Committee may specify the amount of the
Award pool as a percentage of any of such business criteria, a percentage
thereof in excess of a threshold amount, or as another amount which need not
bear a strictly mathematical relationship to such business criteria, provided
that the dollar amount of the Award pool can be calculated based on the level
of achievement of the performance goal. 
The Committee may specify Awards for any one Participant as a percentage
of the Award pool or otherwise in a mathematically determinable way, subject to
such terms and conditions as the Committee may specify, provided that the
aggregate percentage of the Award pool allocated to Participants may not exceed
100% of the Award pool, and for any Covered Employee the maximum payout from
the Award pool shall be specified (and shall be subject to the maximum
limitation under Section 5(a) in any event).


 


6.  Amendments or Termination


 


The
Board may amend, alter or discontinue the Plan, but no amendment, alteration or
discontinuation shall be made which would impair any of the rights or
obligations under any Award theretofore granted to a Participant under the Plan
without such Participant’s consent; provided, however, that the Committee may
amend the Plan in such manner as it deems necessary to permit the granting of
Awards meeting the requirements of the Code or other applicable laws.  Notwithstanding anything to the contrary
herein, the Board may not amend, alter or discontinue the provisions relating
to Section 10(b)(ii) of the Plan after the occurrence of a Change in
Control.


 


7.  No Right to Employment


 


Neither
the Plan nor any action taken hereunder shall be construed as giving any
Participant or other person any right to continue to be employed by or perform
services for the Company or any Subsidiary, and the right to terminate the
employment of or performance of services by any Participant at any time and for
any reason is specifically reserved to the Company and its Subsidiaries.


 


8.  Nontransferability of Awards


 


An
Award shall not be transferable or assignable by the Participant otherwise than
by will or by the laws of descent and distribution.  An Award that constitutes a deferral of
compensation under Code Section 409A shall be subject to the restrictions
on transferability set forth in Section 17(a)(vii) of the ESIP.


 


9.  Reduction of Awards


 


Notwithstanding
anything to the contrary herein, the Committee, in its sole discretion (but
subject to applicable law), may reduce any amounts payable to any


 

















 


Participant
hereunder in order to satisfy any liabilities owed to the Company or any of its
Subsidiaries by the Participant.


 


10.
 Adjustments Upon Certain Events


 


(a) Generally.  In the event of any change in the outstanding
Shares by reason of any Share dividend or split, reorganization,
recapitalization, merger, consolidation, spin-off, combination or exchange of
Shares or other corporate exchange, or any distribution to stockholders of
Shares other than regular cash dividends, the Committee in its sole discretion
and without liability to any person may make such substitution or adjustment,
if any, as it deems to be equitable, as to any affected terms of outstanding
Awards.


 


(b) Change
in Control.  Notwithstanding any other
provision in the Plan to the contrary, in the event of a Change in Control, (i)
the Committee in its sole discretion and without liability to any person may
take such actions, if any, as it deems necessary or desirable with respect to
any Award (including, without limitation, (A) the acceleration of an
Award, (B) the payment of a cash amount in exchange for the cancellation
of an Award and/or (C) the requiring of the issuance of substitute Awards
that will substantially preserve the value, rights and benefits of any affected
Awards previously granted hereunder) as of the date of the consummation of the
Change in Control and (ii) any Participant who, as a result of a Change in
Control, receives payments pursuant to a Change-in-Control agreement shall
receive, subject to the same terms and conditions under which such payments are
made, an amount in cash equal to (A) the annual target bonus under the
Plan for the year in which the Change in Control occurs, multiplied by a
fraction, (X) the numerator of which equals the number of full or partial
days in such annual performance period during which he or she was employed by
the Company and (Y) the denominator of which is 365, and (B) the
entire target bonus opportunity with respect to all other performance periods
in progress under this Plan at the time of his or her termination of employment
from the Company.  For purposes of this Section 10(b),
payment shall occur at such time (compliant with Code Section 409A) as may
be specified by the Committee.  If no
valid time of payment is specified, payment shall be within five business days
after the Change in Control, except that, in the case of any Award that
constitutes a deferral of compensation under Code Section 409A, payment
shall occur within five business days after (i) the occurrence of a “409A
Change in Control” as defined in the Section 17(a)(v)(A) of the ESIP occurring
at the time of or following the Change in Control or (ii) upon occurrence
of the Change in Control occurring within 90 days after the 409A Change in
Control, but only if the occurrence of the Change in Control is
non-discretionary and objectively determinable at the time of the 409A Change
in Control (in this case, the Participant shall have no influence on when
during such 90-day period the payment shall occur).  If a Change in Control occurs but settlement
of an Award that constitutes a deferral of compensation under Code Section 409A
does not occur under the preceding sentence, such Award shall be settled at the
earliest of (i) the earliest permitted time of settlement that would have
applied if the Performance Period continued to its conclusion in the absence of
a Change in Control, (ii) occurrence of a 409A Change in Control, or (iii) the
Participant’s separation from service, subject to the six-month delay rule as
specified in Section 17(a)(iii)(B) of the


 

















 


ESIP.  If payment is delayed by application of the rules under
Code Section 409A, the Company will adjust the cash payment to reflect the
deferred settlement date by multiplying the cash amount by the product of the
six-month CMT Treasury Bill annualized yield rate as published by the U.S.
Treasury for the date on which the award was denominated in cash (or the most
appropriate surrogate for such rate if such rate is not available) multiplied
by a fraction, the numerator of which is the number of days from and including
the date on which the award was denominated in cash until and including the date
of payment of such award to the Participant and the denominator of which is
365, and pay such adjusted amount at settlement.


 


11.  Miscellaneous Provisions


 


The
Company is the sponsor and legal obligor under the Plan and shall make all
payments hereunder, other than any payments to be made by any of the
Subsidiaries (in which case shall be made by such Subsidiary, as
appropriate).  The Company shall not be
required to establish any special or separate fund or to make any other
segregation of assets to ensure the payment of any amounts under the Plan, and
the Participants’ rights to the payment hereunder shall be no greater than the
rights of the Company’s (or Subsidiary’s) unsecured creditors.  All expenses involved in administering the
Plan shall be borne by the Company.


 


12.  Choice of Law


 


The
Plan shall be governed by and construed in accordance with the laws of the
State of New York applicable to contracts made and to be performed in the State
of New York.


 


13.  Effectiveness of the Plan


 


The
Plan became effective as of July 1, 1998. This amendment and restatement
of the Plan shall be effective as of December 16, 2008.