Document:

Exhibit 10.47.1

 

 

Employment
Agreement for Gilles Pajot

 

As Amended and Restated at February 16, 2006

 

 

IMS HEALTH
INCORPORATED

 

Employment
Agreement for Gilles Pajot

 

As Amended and Restated at February 16, 2006

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  1.

  	
  Employment

  	
  1

  
	
   

  	
   

  	
   

  
	
  2.

  	
  Term

  	
  1

  
	
   

  	
   

  	
   

  
	
  3.

  	
  Offices and Duties

  	
  2

  
	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Generally

  	
  2

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  Place of Employment

  	
  2

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  Administrative
  Assistance

  	
  2

  
	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
  Salary and Annual
  Incentive Compensation

  	
  2

  
	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Base Salary

  	
  2

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  Annual Incentive
  Compensation

  	
  2

  
	
   

  	
   

  	
   

  
	
  5.

  	
  Long Term Compensation,
  Including Stock Options, Benefits, Deferred Compensation, and Expense
  Reimbursement

  	
  3

  
	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Executive Compensation
  Plans

  	
  3

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  Employee and Executive
  Benefit Plans

  	
  3

  
	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  Acceleration of Awards
  Upon a Change in Control

  	
  5

  
	
   

  	
   

  	
   

  
	
   

  	
  (d)

  	
  Deferral of
  Compensation

  	
  5

  
	
   

  	
   

  	
   

  
	
   

  	
  (e)

  	
  Company Registration
  Obligations

  	
  5

  
	
   

  	
   

  	
   

  
	
   

  	
  (f)

  	
  Reimbursement of
  Expenses

  	
  5

  
	
   

  	
   

  	
   

  
	
   

  	
  (g)

  	
  Relocation Following
  Termination of Employment

  	
  5

  
	
   

  	
   

  	
   

  
	
   

  	
  (h)

  	
  Limitations Under Code
  Section 409A

  	
  6

  
	
   

  	
   

  	
   

  
	
  6.

  	
  Termination Due to Retirement,
  Death or Disability

  	
  6

  
	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Retirement

  	
  6

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  Death

  	
  7

  
	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  Disability

  	
  7

  
	
   

  	
   

  	
   

  
	
   

  	
  (d)

  	
  Other Terms of Payment
  Following Retirement, Death or Disability

  	
  8

  
	
   

  	
   

  	
   

  
	
  7.

  	
  Termination of
  Employment For Reasons Other Than Retirement, Death, or Disability

  	
  8

  
	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Termination by the
  Company for Cause

  	
  8

  

 

i

 

	
   

  	
  (b)

  	
  Termination by
  Executive Other Than For Good Reason

  	
  8

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  Termination by the
  Company Without Cause Prior to or More than Two Years After a Change in
  Control

  	
  9

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (d)

  	
  Termination by
  Executive for Good Reason Prior to or More than Two Years After a Change in
  Control

  	
  10

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (e)

  	
  Termination by the
  Company Without Cause Within Two Years After a Change in Control

  	
  12

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (f)

  	
  Termination by
  Executive for Good Reason Within Two Years After a Change in Control

  	
  14

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (g)

  	
  Other Terms Relating to
  Certain Terminations of Employment

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
  8.

  	
  Definitions Relating to
  Termination Events

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  “Cause”

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  “Change in Control”

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  “Compensation Accrued
  at Termination”

  	
  17

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (d)

  	
  “Disability”

  	
  17

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (e)

  	
  “Good Reason

  	
  17

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (f)

  	
  “Potential Change in
  Control”

  	
  18

  
	
   

  	
   

  	
   

  	
   

  
	
  9.

  	
  Rabbi Trust Obligation
  Upon Potential Change in Control; Excise Tax Related Provisions

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Rabbi Trust Funded Upon
  Potential Change in Control

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  Gross-up If Excise Tax
  Would Apply

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
  10.

  	
  Non-Competition and
  Non-Disclosure; Executive Cooperation; Non-Disparagement

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Non-Competition

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  Non-Disclosure;
  Ownership of Work

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  Cooperation With Regard
  to Litigation

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (d)

  	
  Non-Disparagement

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (e)

  	
  Release of Employment
  Claims

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (f)

  	
  Forfeiture of
  Outstanding Options

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (g)

  	
  Survival

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
  11.

  	
  Governing Law; Disputes;
  Arbitration

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Governing Law

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  Reimbursement of
  Expenses in Enforcing Rights

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  Arbitration

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (d)

  	
  Interest on Unpaid
  Amounts

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
  12.

  	
  Miscellaneous

  	
  23

  

 

ii

 

	
   

  	
  (a)

  	
  Integration

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  Successors;
  Transferability

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  Beneficiaries

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (d)

  	
  Notices

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (e)

  	
  Reformation

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (f)

  	
  Headings

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (g)

  	
  No General Waivers

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (h)

  	
  No Obligation To
  Mitigate

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (i)

  	
  Offsets; Withholding

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (j)

  	
  Successors and Assigns

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (k)

  	
  Counterparts

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
  13.

  	
  Indemnification

  	
  25

  

 

iii

 

IMS HEALTH
INCORPORATED

 

Employment
Agreement for Gilles Pajot

 

As Amended and Restated at February 16, 2006

 

THIS
EMPLOYMENT AGREEMENT by and between IMS HEALTH INCORPORATED, a Delaware
corporation (the “Company,” subject to Section 12(b)), and Gilles Pajot (“Executive”)
shall become effective as of November 14, 2000 (the “Effective Date”). The
first amendment and restatement of this Employment Agreement became effective
as of February 16, 2006 (the “Restatement Date”).

 

W I T N E S S E T H

 

WHEREAS, Executive has
served the Company and its predecessors as an executive of their subsidiaries
since December 16, 1997;

 

WHEREAS, the Company
desires to continue to employ Executive as Executive Vice President of the
Company and, from the Restatement Date, as President, Global Business
Management, for the Company, and Executive desires to accept such employment on
the terms and conditions herein set forth.

 

NOW, THEREFORE, in
consideration of the foregoing, the mutual covenants contained herein, and
other good and valuable consideration the receipt and adequacy of which the
Company and Executive each hereby acknowledge, the Company and Executive hereby
agree as follows:

 

1.                                       Employment.

 

The Company hereby agrees
to employ Executive as its Executive Vice President of the Company and, from
the Restatement Date, as President, Global Business Management, for the Company,
and Executive hereby agrees to accept such employment and serve in such
capacities, during the Term as defined in Section 2 (subject to Section 7(c))
and upon the terms and conditions set forth in this Employment Agreement (the “Agreement”).

 

2.                                       Term.

 

The term of employment of
Executive under this Agreement (the “Term”) shall be the period commencing on
the Effective Date and ending on December 31, 2002 and any period of
extension thereof in accordance with this Section 2, except that the Term
will end at a date, prior to the end of such period or extension thereof,
specified in Section 6 or 7 in the event of termination of Executive’s
employment. The Term, if not previously ended, shall be extended automatically
without further action by either party by one additional year (added to the end
of the Term) first on December 31, 2002 (extending the Term to December 31,
2003) and on each succeeding December 31 thereafter, unless either party
shall have served written notice in accordance with Section 12(d) upon
the other party on or before the June 30 preceding a December 31
extension date electing not to extend the Term further as of that December 31
extension date, in which case employment shall terminate on that December 31
and the Term shall end at that date, subject to earlier termination of
employment and earlier termination of the Term in accordance with Section 6
or 7. The foregoing notwithstanding, in the event there occurs a Potential
Change in Control during the period of 180 days prior to the December 31
on which the Term will terminate as a result of notice given by the Executive
or the Company hereunder, the Term shall be extended automatically at that December 31
by an additional period such that the Term will extend until the 180th day
following such Potential Change in Control.

 

1

 

3.                                       Offices
and Duties.

 

The provisions of this Section 3
will apply during the Term after the Restatement Date, except as otherwise
provided in Section 7(c) or 7(e):

 

(a)                                  Generally.
Executive shall serve as the Executive Vice President of the Company and
President, Global Business Management, for the Company. In any and all such
capacities, Executive shall report only to the Chief Executive Officer of the
Company and to the Board of Directors (the “Board”). Executive shall have and
perform such duties, responsibilities, and authorities as are customary
for an executive vice president and a designated president responsible for
global business management of a publicly held corporation of the size, type,
and nature of the Company as they may exist from time to time and
consistent with such position and status, but in no event shall such duties,
responsibilities, and authorities be reduced from those of Executive at the Restatement
Date (including those specified in this Section 3(a)), except with the
written consent of Executive. Executive shall devote his full business time and
attention, and his best efforts, abilities, experience, and talent, to the
positions of Executive Vice President of the Company and President, Global
Business Management, for the Company, and for the businesses of the Company
without commitment to other business endeavors, except that Executive (i) may make
personal investments which are not in conflict with his duties to the Company
and manage personal and family financial and legal affairs, (ii) may undertake
public speaking engagements, and (iii) may serve as a director of (or
similar position with) any other business or an educational, charitable,
community, civic, religious, or similar type of organization with the approval
of the Chief Executive Officer, so long as such activities (i.e., those listed
in clauses (i) through (iii)) do not preclude or render unlawful Executive’s
employment or service to the Company or otherwise materially inhibit the
performance of Executive’s duties under this Agreement or materially impair the
business of the Company or its subsidiaries. It is understood that the
designation as “President, Global Business Management” does not constitute an
appointment to the corporate office of President of the Company.

 

(b)                                 Place
of Employment. Executive’s principal place of employment shall be at the
Corporate Offices of the Company which shall be in Fairfield, Connecticut.

 

(c)                                  Administrative
Assistance. Executive will be provided with a senior level executive
assistant at the Corporate Offices of the Company in Fairfield, Connecticut.

 

4.                                       Salary
and Annual Incentive Compensation.

 

As partial compensation
for the services to be rendered hereunder by Executive, the Company agrees to
pay to Executive during the Term after the Restatement Date the compensation
set forth in this Section 4.

 

(a)                                  Base
Salary. With effect from the Restatement Date the Company will pay to
Executive during the Term a base salary, the annual rate of which shall be
Pounds Sterling 364,140, payable in cash in substantially equal semi-monthly
installments, and otherwise in accordance with the Company’s usual payroll
practices with respect to senior executives (except to the extent deferred
under Section 5(d)). Executive’s annual base salary shall be reviewed by
the Compensation and Benefits Committee of the Board (the “Committee”) at least
once in each calendar year, and may be increased above, but may not
be reduced below, the then-current rate of such base salary. For purposes of
this Agreement, “Base Salary” means Executive’s then-current base salary.

 

(b)                                 Annual
Incentive Compensation. The Company will pay to Executive during the Term
annual incentive compensation which shall offer to Executive an opportunity to
earn additional compensation based upon performance in amounts determined by
the Committee in accordance with the applicable plan and consistent with past
practices of the Company; provided, however, that the annual incentive
opportunity during the Term shall be not less than 71% of Base Salary or the
annual target incentive opportunity for the prior year for achievement of
target level performance, with the nature of the performance and the levels of performance
triggering payments of such annual target incentive compensation for each year
to be established and communicated to Executive during the first quarter of
such year by the Committee; provided further that annual incentive payable for
performance in 2006 shall be based on the amount of salary actually paid during

 

2

 

the year. In addition,
the Committee (or the Board) may determine, in its discretion, to increase
the Executive’s annual target incentive opportunity or provide an additional
annual incentive opportunity, in excess of the annual target incentive
opportunity, payable for performance in excess of or in addition to the
performance required for payment of the annual target incentive amount. Any
annual incentive compensation payable to Executive shall be paid in accordance
with the Company’s usual practices with respect to payment of incentive
compensation to senior executives (except to the extent deferred under Section 5(d)).

 

5.                                       Long-Term
Compensation, Including Stock Options, Benefits, Deferred Compensation, and
Expense Reimbursement

 

(a)                                  Executive
Compensation Plans. Executive shall be entitled during the
Term to participate, without discrimination or duplication, in all executive
compensation plans and programs intended for general participation by senior
executives of the Company, as presently in effect or as they may be
modified or added to by the Company from time to time, subject to the
eligibility and other requirements of such plans and programs, including
without limitation any stock option plans, plans under which restricted
stock/restricted stock units, performance-based restricted stock/restricted
stock units (“PERS”) or performance-accelerated restricted stock/restricted
stock units (“PARS”) may be awarded, other annual and long-term cash
and/or equity incentive plans, and deferred compensation plans; provided,
however, that such plans and programs, in the aggregate, after the Restatement
Date shall provide Executive with compensation and incentive award
opportunities substantially no less favorable than those provided by the
Company to Executive under such plans and programs as in effect on the
Restatement Date. In furtherance
of the foregoing:

 

(i)                                     Executive
will continue to be eligible for awards of PERS under the Performance-Based
Restricted Stock Program (the “PBRSP”) which match the amount of annual
incentive compensation earned under Section 4(b) (with the 2006 award
opportunity based on the annual incentive opportunity under Section 4(b) in
effect on and after the Restatement Date); provided, however, that the Company may replace
the PBRSP with a different long-term incentive program providing an incentive
opportunity determined by the Committee to be reasonably comparable to that
under the PBRSP; and

 

(ii)                                  Executive
has been granted 39,856 restricted stock units (“RSUs”) as of January 3,
2006, under the Company’s 1998 Employees’ Stock Incentive Plan, on the terms
and conditions set forth in the Restricted Stock Unit Grant Agreement. The RSUs
are conditioned upon, among other things, Executive agreeing to the amendment
and restatement of this Agreement as of the Restatement Date.

 

(b)                                 Employee
and Executive Benefit Plans. Executive shall be entitled during the Term to
participate, without discrimination or duplication, in all employee and
executive benefit plans and programs of the Company, as presently in effect or
as they may be modified or added to by the Company from time to time, to
the extent such plans are available generally to other senior executives or
employees of the Company, subject to the eligibility and other requirements of
such plans and programs, including without limitation plans providing pensions,
supplemental pensions, supplemental and other retirement benefits, medical
insurance, life insurance, disability insurance, and accidental death or
dismemberment insurance, as well as savings, profit-sharing, and stock
ownership plans; provided, however, that such benefit plans and programs, in
the aggregate, shall provide Executive with benefits and compensation after the
Restatement Date substantially no less favorable than those provided by the
Company to Executive under such plans and programs as in effect on the Restatement
Date. The foregoing notwithstanding, Executive shall not be eligible to
participate or receive benefits under the Company’s Employee Protection Plan,
and benefits to Executive under his Change-in-Control Agreement shall be
payable only if and to the extent that such benefits would exceed the corresponding
benefits payable under this Agreement.

 

In furtherance of and not
in limitation of the foregoing, during the Term after the Restatement Date:

 

3

 

(i)                                     Executive
will participate as Executive Vice President and President, Global Business
Management, in all executive and employee vacation and time-off programs;

 

(ii)                                  The
Company will provide Executive with coverage as Executive Vice President and
President, Global Business Management, with respect to long-term disability
insurance and benefits substantially no less favorable (including any required
contributions by Executive) than such insurance and benefits in effect on the
Restatement Date;

 

(iii)                               Executive
will be covered by Company-paid group and individual term life insurance
providing a death benefit no less than the death benefit provided under
Company-paid insurance in effect at the Restatement Date; provided, however,
that, with the consent of Executive, such insurance may be combined with a
supplementary retirement funding vehicle;

 

(iv)                              Executive
will be entitled to retirement benefits equivalent to the benefits he would
have received under the Pharmacia & Upjohn Global Officers Pension
Plan, as set forth on Exhibit A hereto (the “PUGOPP”), taking into account
all offsets as applicable under the PUGOPP and without regard to any changes to
the PUGOPP implemented by Pharmacia & Upjohn since Executive became an
employee of I.M.S. International, Inc., if he had remained continuously
employed by Pharmacia & Upjohn through the date of his Termination of
Employment with the Company, treating salary paid by the Company and its
subsidiaries as salary and years of service to the Company and its subsidiaries
as years of service for purposes of the PUGOPP (subject to Sections 7(e)((vii) and
7(f)(vii), if applicable); provided, however, that for purposes of
calculating retirement benefits under the PUGOPP, “average final compensation”
shall be calculated based on compensation paid in respect of the final five full
years of service of Executive preceding his termination of employment by the
Company,; provided further, that the amount of the Company’s obligations
hereunder shall be reduced by the amount of any benefits actually paid to
Executive in respect of the PUGOPP by any third party; and provided further,
that, in the event of Executive’s termination due to Disability in accordance
with Section 6(c), Executive will receive benefits (without duplication)
not less than the benefits he would have received had he been a participant in
the Company’s United States Executive Retirement Plan credited with years of
service equal to his years of service to the Company from the commencement of
his employment; and provided further, that, in the event of termination
of Executive’s employment by the Company for Cause, no benefits will be payable
to Executive pursuant to this Section 5(b)(iv);

 

(v)                                 The
Company will provide Executive with health and medical benefits consistent with
its policies for other senior executives, but including medical, dental and
prescription drug coverage provided through IMS International Medical &
Dental or replacement coverage as Executive may agree to from time to
time; and

 

(vi)                              The
Company will provide Executive with the following:

 

•                  An
automobile allowance, car service or company car to facilitate daily travel to
and from Company offices and business activities (“commuting”). The Company
will reimburse Executive for income taxes resulting from commuting and from the
reimbursement of taxes therefore under this Section 5(b))(vi), but the
reimbursement for taxes under this Section 5(b)(vi) will not apply to
other income taxes resulting from permitted personal use of the automobile and
driver or car service. The automobile allowance being paid in the United
Kingdom prior to the Restatement Date will be discontinued at and after the
Restatement Date.

 

•                  Continued
payment by the Company of rent for housing, security, furniture rental,
cleaning services and utilities, consistent with the type and level of such
benefits provided by the Company immediately prior to the Restatement Date. Executive’s
housing during the Term covered by this provision shall be equivalent to
Executive’s apartment in the United Kingdom immediately prior to the
Restatement Date. The Company will bear any lease costs relating to Executive’s
United Kingdom apartment after the Restatement Date through its expiration in July 2006.

 

4

 

•                  The
benefits under the Executive Rewards Program, as in effect during the Term
(currently providing up to $10,000 for payment for professional financial
planning services plus Company paid tax preparation).

 

•                  Tax
equalization payments so that Executive’s U.S. federal, state and local income
and employment tax burden does not exceed the amount of income tax and Employee
National Insurance Contributions that would have been payable had Executive
been working and residing in the United Kingdom, such tax equalization to be
subject to and paid in accordance with the Company’s standard expatriate policy
for senior executives, as such policy may from time to time be in effect
(but changes to the policy shall not cause it to be, in the aggregate, less
favorable to Executive than at the Restatement Date).

 

Any provision to the contrary contained
in this Agreement notwithstanding, unless Executive is terminated by the
Company for “Cause” (as defined in Section 8(a)) or Executive terminates
voluntarily and not for “Good Reason” (as defined in Section 8(e)),
Executive may elect continued participation after termination of
employment in the Company’s health and medical coverage for himself and his
spouse and dependent children after such coverage would otherwise end until
such time as Executive becomes eligible for similar coverage with a subsequent
employer or other entity to which Executive provides services or becomes
eligible for Medicare (under rules in effect at the Effective Date
hereof); provided, however, that in the event of such election, Executive shall
pay the Company each year an amount equal to the then-current annual COBRA
premium being paid (or payable) by any other former employee of the Company,
unless otherwise provided under Section 6 or 7.

 

(c)                                  Acceleration
of Awards Upon a Change in Control. In the event of a Change in Control (as
defined in Section 8(b)), all outstanding stock options, restricted stock,
and other equity-based awards then held by Executive shall become vested and
exercisable.

 

(d)                                 Deferral
of Compensation. If the Company has in effect or adopts any deferral
program or arrangement permitting executives to elect to defer any
compensation, Executive will be eligible to participate in such program on
terms no less favorable than the terms of participation of any other executive
officer of the Company. Any plan or program of the Company which provides
benefits based on the level of salary, annual incentive, or other compensation
of Executive shall, in determining Executive’s benefits, take into account the
amount of salary, annual incentive, or other compensation prior to any
reduction for voluntary contributions made by Executive under any deferral or
similar contributory plan or program of the Company (excluding compensation
that would not be taken into account even if not deferred), but shall not treat
any payout or settlement under such a deferral or similar contributory plan or
program to be additional salary, annual incentive, or other compensation for
purposes of determining such benefits, unless otherwise expressly provided
under such plan or program.

 

(e)                                  Company
Registration Obligations. The Company will use its best efforts to file
with the Securities and Exchange Commission and thereafter maintain the
effectiveness of one or more registration statements registering under the
Securities Act of 1933, as amended (the “1933 Act”), the offer and sale of
shares by the Company to Executive pursuant to stock options or other
equity-based awards granted to Executive under Company plans or otherwise or,
if shares are acquired by Executive in a transaction not involving an offer or
sale to Executive but resulting in the acquired shares being “restricted
securities” for purposes of the 1933 Act, registering the reoffer and resale of
such shares by Executive.

 

(f)                                    Reimbursement
of Expenses. The Company will promptly reimburse Executive for all
reasonable business expenses and disbursements incurred by Executive in the
performance of Executive’s duties during the Term in accordance with the
Company’s reimbursement policies as in effect from time to time.

 

(g)                                 Relocation
Following Termination of Employment. Following termination of Executive’s
employment for any reason other than Executive’s voluntary termination with the
intent to accept employment with a business entity not affiliated with the
Company, the Company will pay all reasonable and customary

 

5

 

expenses of Executive to
relocate Executive and his household to his intended new home. Executive’s
intended new home may be his former home or any other location designated
by Executive. Reasonable and customary expenses shall be presumed to include
expenses of the type reimbursed by the Company for relocation of executives in
the past, which shall include a tax reimbursement (gross-up), except reasonable
and customary expenses shall not include (i) expenses relating to the
purchasing or selling of Executive’s old or new home, (ii) losses from any
sale of any home of Executive, and (iii) expenses due to the costs of new
housing selected by Executive.

 

(h)                                 Limitations Under Code Section 409A.
In the event that, as a result of Section 409A of the Internal Revenue
Code (the “Code”) (and any related regulations or other pronouncements), any of
the payments or benefits that Executive is entitled to under the terms of this
Agreement or any other plan involving deferred compensation (as defined under
Code Section 409A) may not be made at the time contemplated by the
terms thereof without causing the Executive to be subject to an income tax
penalty and interest and the timing of payment is the sole cause of such
adverse tax consequences, the Company will make such payment on the first day
permissible under Code Section 409A without the Executive incurring such
adverse tax consequences. In particular, with respect to any lump sum payment
otherwise required hereunder, in the event of any delay in the payment date as
a result of Code Section 409A(a)(2)(A)(i) and (B)(i), the Company
will adjust the payment to reflect the deferred payment date by crediting
interest thereon using the interest rate applicable under the IMS Health
Incorporated Supplemental Executive Retirement Plan at the time such amount
first becomes payable. In addition, other provisions of this Agreement or any
other such plan notwithstanding, the Company shall have no right to accelerate
any such payment or to make any such payment as the result of any specific
event except to the extent permitted under Section 409A. The Company shall
not be obligated to reimburse Executive for any tax penalty or interest or
provide a gross-up in connection with any tax liability of Executive under Section 409A,
except this provision will not limit any gross-up payable under Section 9(b) or
tax equalization payment under Section 5(b)(vi).

 

6.                                       Termination Due to Retirement, Death, or Disability.

 

(a)                                  Retirement.
Executive may elect to terminate employment hereunder by retirement at or
after age 55 or, upon the request of Executive, at such earlier age as may be
approved by the Board (in either case, “Retirement”). At the time Executive’s
employment terminates due to Retirement, the Term will terminate, all
obligations of the Company and Executive under Sections 1 through 5 of this
Agreement will immediately cease except for obligations which expressly
continue after termination of employment due to Retirement, and the Company
will pay Executive, and Executive will be entitled to receive, the following:

 

(i)                                     Executive’s
Compensation Accrued at Termination (as defined in Section 8(c));

 

(ii)                                  In
lieu of any annual incentive compensation under Section 4(b) for the
year in which Executive’s employment terminated, an amount equal to the portion
of annual incentive compensation that would have become payable in cash to
Executive (i.e., excluding the portion payable in PERS or in other non-cash
awards) for that year if his employment had not terminated, based on
performance actually achieved in that year (determined by the Committee
following completion of the performance year), multiplied by a fraction the
numerator of which is the number of days Executive was employed in the year of
termination and the denominator of which is the total number of days in the
year of termination;

 

(iii)                               The
vesting and exercisability of stock options held by Executive at termination
and all other terms of such options shall be governed by the plans and programs
and the agreements and other documents pursuant to which such options were
granted (subject to Section 10(f) hereof); and

 

(iv)                              All
restricted stock and deferred stock awards, including outstanding PERS awards,
all other long-term incentive awards, and all deferral arrangements under Section 5(d),
shall be governed by the plans and programs under which the awards were granted
or governing the deferral, and all rights under any other benefit plan shall be
governed by such plan.

 

6

 

(b)                                 Death.
In the event of Executive’s death which results in the termination of Executive’s
employment, the Term will terminate, all obligations of the Company and
Executive under Sections 1 through 5 of this Agreement will immediately cease
except for obligations which expressly continue after death, and the Company
will pay Executive’s beneficiary or estate, and Executive’s beneficiary or
estate will be entitled to receive, the following:

 

(i)                                     Executive’s
Compensation Accrued at Termination;

 

(ii)                                  In
lieu of any annual incentive compensation under Section 4(b) for the
year in which Executive’s death occurred, an amount equal to the portion of
annual incentive compensation that would have become payable in cash to
Executive (i.e., excluding the portion payable in PERS or in other non-cash
awards) for that year if his employment had not terminated, based on
performance actually achieved in that year (determined by the Committee
following completion of the performance year), multiplied by a fraction the
numerator of which is the number of days Executive was employed in the year of
his death and the denominator of which is the total number of days in the year
of death;

 

(iii)                               The
vesting and exercisability of stock options held by Executive at death and all
other terms of such options shall be governed by the plans and programs and the
agreements and other documents pursuant to which such options were granted; and

 

(iv)                              All
restricted stock and deferred stock awards, including outstanding PERS awards,
all other long-term incentive awards, and all deferral arrangements under Section 5(d),
shall be governed by the plans and programs under which the awards were granted
or governing the deferral, and all rights under any other benefit plan shall be
governed by such plan.

 

(c)                                  Disability.
The Company may terminate the employment of Executive hereunder due to the
Disability (as defined in Section 8(d)) of Executive. Such employment
shall terminate at the expiration of the 30-day period referred to in the
definition of Disability set forth in Section 8(d), unless Executive has
returned to service and presented to the Company a certificate of good health
prior to such termination as specified in Section 8(d). Upon termination
of employment, the Term will terminate, all obligations of the Company and
Executive under Sections 1 through 5 of this Agreement will immediately cease
except for obligations which expressly continue after termination of employment
due to Disability, and the Company will pay Executive, and Executive will be
entitled to receive, the following:

 

(i)                                     Executive’s
Compensation Accrued at Termination;

 

(ii)                                  In
lieu of any annual incentive compensation under Section 4(b) for the
year in which Executive’s employment terminated, an amount equal to the portion
of annual incentive compensation that would have become payable in cash to
Executive (i.e., excluding the portion payable in PERS or in other non-cash
awards) for that year if his employment had not terminated, based on
performance actually achieved in that year (determined by the Committee
following completion of the performance year), multiplied by a fraction the
numerator of which is the number of days Executive was employed in the year of
termination and the denominator of which is the total number of days in the
year of termination;

 

(iii)                               Stock
options held by Executive at termination shall be governed by the plans and
programs and the agreements and other documents pursuant to which such options
were granted;

 

(iv)                              Any
performance objectives upon which the earning of performance-based restricted
stock and deferred stock awards, including outstanding PERS awards, and other
long-term incentive awards is conditioned shall be deemed to have been met at
target level at the date of termination, and restricted stock and deferred
stock awards, including outstanding PERS awards, and other long-term incentive
awards (to the extent then or previously earned, in the case of performance-based
awards) shall become fully vested and non-forfeitable at the date of such
termination, and, in other respects, such awards shall be governed by the plans
and programs and the agreements and other documents pursuant to which such
awards were granted;

 

7

 

(v)                                 Disability
benefits shall be payable in accordance with the Company’s plans, programs and
policies, and all deferral arrangements under Section 5(d) will be
settled in accordance with the plans and programs governing the deferral; and

 

(vi)                              For
the period extending from the date of termination due to Disability until the
date Executive reaches age 65, Executive shall continue to participate in those
employee and executive benefit plans and programs under Section 5(b) to
the extent such plans and programs provide medical insurance, disability
insurance and life insurance benefits (but not other benefits, such as pension
and retirement benefits, provided under Section 5(b)) in which Executive
was participating immediately prior to termination, the terms of which allow
Executive’s continued participation, as if Executive had continued in
employment with the Company during such period or, if the terms of such plans
or programs do not allow Executive’s continued participation, Executive shall
be paid a cash payment equivalent on an after-tax basis to the value of the
additional benefits (of the type described in this Section 6(c)(vi))
Executive would have received under such plans or programs had Executive continued
to be employed during such period following Executive’s termination until age
65, with such benefits provided by the Company at the same times and in the
same manner as such benefits would have been provided to Executive under such
plans and programs (it being understood that the value of any insurance-provided
benefits will be based on the premium cost to Executive, which shall not exceed
the highest risk premium charged by a carrier having an investment grade or
better credit rating). The foregoing notwithstanding, Executive must continue
to satisfy the conditions set forth in Section 10 in order to continue
receiving the benefits provided under this Section 6(c)(vi).

 

(d)                                 Other
Terms of Payment Following Retirement, Death, or Disability. Nothing in
this Section 6 shall limit the benefits payable or provided In the event
Executive’s employment terminates due to Retirement, death, or Disability under
the terms of plans or programs of the Company more favorable to the Executive
(or his beneficiaries) than the benefits payable or provided under this Section 6
(except in the case of annual incentives in lieu of which amounts are paid
hereunder), including plans and programs adopted after the date of this
Agreement. Amounts payable under this Section 6 following Executive’s
termination of employment, other than those expressly payable following
determination of performance for the year of termination for purposes of annual
incentive compensation or otherwise expressly payable on a deferred basis, will
be paid as promptly as practicable after such termination of employment.

 

7.                                       Termination
of Employment For Reasons Other Than Retirement, Death or Disability.

 

(a)                                  Termination
by the Company for Cause. The Company may terminate the employment of
Executive hereunder for Cause (as defined in Section 8(a)) at any time. At
the time Executive’s employment is terminated for Cause, the Term will
terminate, all obligations of the Company and Executive under Sections 1
through 5 of this Agreement will immediately cease except for obligations which
expressly continue after termination of employment by the Company for Cause,
and the Company will pay Executive, and Executive will be entitled to receive,
the following:

 

(i)                                     Executive’s
Compensation Accrued at Termination (as defined in Section 8(c));

 

(ii)                                  All
stock options, restricted stock and deferred stock awards, including
outstanding PERS awards, and all other long-term incentive awards will be
governed by the terms of the plans and programs under which the awards were
granted; and

 

(iii)                               All
deferral arrangements under Section 5(d) will be settled in
accordance with the plans and programs governing the deferral, and all rights
under any other benefit plan shall be governed by such plan (subject to Section 5(b)).

 

(b)                                 Termination
by Executive Other Than For Good Reason. Executive may terminate his
employment hereunder voluntarily for reasons other than Good Reason (as defined
in Section 8(e)) at any time, upon 90 days’ written notice to the Company.
An election by Executive not to extend the Term pursuant to Section 2
hereof shall be deemed to be a termination of employment by Executive for
reasons other than Good Reason at the date of expiration of the Term, unless a
Change in Control (as defined in Section 8(b))

 

8

 

occurs prior to, and
there exists Good Reason at, such date of expiration. At the time Executive’s
employment is terminated by Executive other than for Good Reason the Term will
terminate, all obligations of the Company and Executive under Sections 1
through 5 of this Agreement will immediately cease, and the Company will pay
Executive, and Executive will be entitled to receive, the following:

 

(i)                                     Executive’s
Compensation Accrued at Termination;

 

(ii)                                  All
stock options, restricted stock and deferred stock awards, including
outstanding PERS awards, and all other long-term incentive awards will be
governed by the terms of the plans and programs under which the awards were
granted; and

 

(iii)                               All
deferral arrangements under Section 5(d) will be settled in
accordance with the plans and programs governing the deferral, and all rights
under any other benefit plan shall be governed by such plan.

 

(c)                                  Termination
by the Company Without Cause Prior to or More than Two Years After a Change in
Control. The Company may terminate the employment of Executive
hereunder without Cause, if at the date of termination no Change in Control has
occurred or such date of termination is at least two years after the most
recent Change in Control, upon at least 90 days’ written notice to Executive. The
foregoing notwithstanding, the Company may elect, by written notice to
Executive, to terminate Executive’s positions specified in Sections 1 and 3 and
all other obligations of Executive and the Company under Section 3 at a
date earlier than the expiration of such 90-day period, if so specified by the
Company in the written notice, provided that Executive shall be treated as an
employee of the Company (without any assigned duties) for all other purposes of
this Agreement, including for purposes of Sections 4 and 5, from such specified
date until the expiration of such 90-day period. An election by the Company not
to extend the Term pursuant to Section 2 hereof shall be deemed to be a
termination of Executive’s employment by the Company without Cause at the date
of expiration of the Term and shall be subject to this Section 7(c) if
at the date of such termination no Change in Control has occurred or such date
of termination is at least two years after the most recent Change in Control;
provided, however, that, if Executive has attained age 65 at such date of
termination, such termination shall be deemed a Retirement of Executive. At the
time Executive’s employment is terminated by the Company (i.e., at the
expiration of such notice period), the Term will terminate, all remaining
obligations of the Company and Executive under Sections 1 through 5 of this
Agreement will immediately cease (except for obligations which continue after
termination of employment as expressly provided herein), and the Company will
pay Executive, and Executive will be entitled to receive, the following:

 

(i)                                     Executive’s
Compensation Accrued at Termination;

 

(ii)                                  Cash
in an aggregate amount equal to two times the sum of (A) Executive’s Base
Salary under Section 4(a) immediately prior to termination plus (B) an
amount equal to the greater of (x) the portion of Executive’s annual target
incentive compensation potentially payable in cash to Executive (i.e.,
excluding the portion payable in PERS or in other non-cash awards) for the year
of termination or (y) the portion of Executive’s annual incentive compensation
that became payable in cash to Executive (i.e., excluding the portion payable
in PERS or in other non-cash awards) for the latest year preceding the year of
termination based on performance actually achieved in that latest year. The
amount determined to be payable under this Section 7(c)(ii) shall be
payable in monthly installments over the 24 months following termination, without
interest, except the Company may elect to accelerate payment of the
remaining balance of such amount and to pay it as a lump sum, without discount;

 

(iii)                               In
lieu of any annual incentive compensation under Section 4(b) for the
year in which Executive’s employment terminated, an amount equal to the portion
of Executive’s annual target incentive compensation potentially payable in cash
to Executive (i.e., excluding the portion payable in PERS or in other non-cash
awards) for the year of termination, multiplied by a fraction the numerator of
which is the number of days Executive was employed in the year of termination
and the denominator of which is the total number of days in the year of
termination;

 

9

 

(iv)                              Stock
options held by Executive at termination, if not then vested and exercisable,
will become fully vested and exercisable at the date of such termination, and,
in other respects (including the period following termination during which such
options may be exercised), such options shall be governed by the plans and
programs and the agreements and other documents pursuant to which such options
were granted; except stock options which were outstanding and “in-the-money” at
the Effective date, other than such options which were granted either on February 15,
2000 and May 25, 2000 (all tranches), shall be governed by the terms of
the plans and agreements governing such options;

 

(v)                                 Any
performance objectives upon which the earning of performance-based restricted
stock and deferred stock awards, including outstanding PERS awards, and other
long-term incentive awards is conditioned shall be deemed to have been met at
target level at the date of termination, and restricted stock and deferred
stock awards, including outstanding PERS awards, and other long-term incentive
awards (to the extent then or previously earned, in the case of
performance-based awards) shall become fully vested and non-forfeitable at the
date of such termination, and, in other respects, such awards shall be governed
by the plans and programs and the agreements and other documents pursuant to
which such awards were granted;

 

(vi)                              All
deferral arrangements under Section 5(d) will be settled in
accordance with the plans and programs governing the deferral;

 

(vii)                           All
rights under any other benefit plan shall be governed by such plan (subject to Section 5(b));
and

 

(viii)                        For a period
of two years after such termination (but not after Executive attains age 65),
Executive shall continue to participate in those employee and executive benefit
plans and programs under Section 5(b) to the extent such plans and
programs provide medical insurance, disability insurance and life insurance
benefits (but not other benefits, such as pension and retirement benefits,
provided under Section 5(b)) in which Executive was participating
immediately prior to termination, the terms of which allow Executive’s
continued participation, as if Executive had continued in employment with the
Company during such period; provided, however, that such participation shall
terminate, or the benefits under such plans and programs shall be reduced, if
and to the extent Executive becomes covered (or is eligible to become covered)
by plans of a subsequent employer or other entity to which Executive provides
services during such period providing comparable benefits. If the terms of the
Company plans and programs referred to in this Section 7(c)(viii) do
not allow Executive’s continued participation, Executive shall be paid a cash
payment equivalent on an after-tax basis to the value of the additional
benefits described in this Section 7(c)(viii) Executive would have
received under such plans or programs had Executive continued to be employed
during such period, with such benefits provided by the Company at the same
times and in the same manner as such benefits would have been provided to
Executive under such plans and programs (it being understood that the value of
any insurance-provided benefits will be based on the premium cost to Executive,
which shall not exceed the highest risk premium charged by a carrier having an
investment grade or better credit rating); provided, however, that Executive
must continue to satisfy the conditions set forth in Section 10 in order
to continue receiving the benefits provided under this Section 7(c)(viii).
Executive agrees to promptly notify the Company of any employment or other
arrangement by which Executive provides services during the
benefits-continuation period and of the nature and extent of benefits for which
Executive becomes eligible during such period which would reduce or terminate
benefits under this Section 7(c)(viii); and the Company be entitled to
recover from Executive any payments and the fair market value of benefits
previously made or provided to Executive hereunder which would not have been
paid under this Section 7(c)(viii) if the Company had received
adequate prior notice as required by this sentence.

 

(d)                                 Termination
by Executive for Good Reason Prior to or More than Two Years After a Change in
Control. Executive may terminate his employment hereunder for Good
Reason, prior to a Change in Control or after the second anniversary of the
most recent Change in Control, upon 90 days’ written notice to the Company;
provided, however, that, if the Company has corrected the basis for such Good
Reason within

 

10

 

30 days after receipt of
such notice, Executive may not terminate his employment for Good Reason,
and therefore Executive’s notice of termination will automatically become null
and void. At the time Executive’s employment is terminated by Executive for
Good Reason (i.e., at the expiration of such notice period), the Term will
terminate, all obligations of the Company and Executive under Sections 1
through 5 of this Agreement will immediately cease (except for obligations
which continue after termination of employment as expressly provided herein),
and the Company will pay Executive, and Executive will be entitled to receive,
the following:

 

(i)                                     Executive’s
Compensation Accrued at Termination;

 

(ii)                                  Cash
in an aggregate amount equal to two times the sum of (A) Executive’s Base
Salary under Section 4(a) immediately prior to termination plus (B) an
amount equal to the greater of (x) the portion of Executive’s annual target
incentive compensation potentially payable in cash to Executive (i.e.,
excluding the portion payable in PERS or in other non-cash awards) for the year
of termination or (y) the portion of Executive’s annual incentive compensation
that became payable in cash to Executive (i.e., excluding the portion payable
in PERS or in other non-cash awards) for the latest year preceding the year of
termination based on performance actually achieved in that latest year. The
amount determined to be payable under this Section 7(d)(ii) shall be
payable in monthly installments over the 24 months following termination,
without interest, except the Company may elect to accelerate payment of
the remaining balance of such amount and to pay it as a lump sum, without
discount;

 

(iii)                               In lieu of
any annual incentive compensation under Section 4(b) for the year in
which Executive’s employment terminated, an amount equal to the portion of
Executive’s annual target incentive compensation potentially payable in cash to
Executive (i.e., excluding the portion payable in PERS or in other non-cash
awards) for the year of termination, multiplied by a fraction the numerator of
which is the number of days Executive was employed in the year of termination
and the denominator of which is the total number of days in the year of
termination;

 

(iv)                              Stock
options held by Executive at termination, if not then vested and exercisable,
will become fully vested and exercisable at the date of such termination, and,
in other respects (including the period following termination during which such
options may be exercised), such options shall be governed by the plans and
programs and the agreements and other documents pursuant to which such options
were granted; provided, however, that (A) stock
options which were outstanding and “in-the-money” at the Effective date, other
than such options which were granted either on February 15, 2000 and May 25,
2000 (all tranches), shall be governed by the terms of the plans and agreements
governing such options, and (B) no acceleration of vesting and
exercisability of any option granted on or after January 1, 2006 shall
apply under this Section 7(d)(iv) if Executive’s Good Reason is based
solely on Good Reason as defined in Section 8(e)(ix);

 

(v)                                 Any
performance objectives upon which the earning of performance-based restricted
stock and deferred stock awards, including outstanding PERS awards, and other
long-term incentive awards is conditioned shall be deemed to have been met at
target level at the date of termination, and restricted stock and deferred
stock awards, including outstanding PERS awards, and other long-term incentive
awards (to the extent then or previously earned, in the case of
performance-based awards) shall become fully vested and non-forfeitable at the
date of such termination, except the foregoing provisions of this Section 7(d)(v) shall
not apply to any PERS or other performance-based equity award or long-term
incentive award earned for performance in a performance period beginning on or
after January 1, 2006 or any non-performance-based equity award granted on
or after January 1, 2006 (including the RSUs granted as of January 3,
2006) if Executive’s Good Reason is based solely on Good Reason as defined in Section 8(e)(ix);
and, in other respects, such awards shall be governed by the plans and programs
and the agreements and other documents pursuant to which such awards were
granted;

 

(vi)                              All
deferral arrangements under Section 5(d) will be settled in
accordance with the plans and programs governing the deferral;

 

11

 

(vii)                           All
rights under any other benefit plan shall be governed by such plan (subject to Section 5(b));
and

 

(viii)                        For a
period of two years after such termination (but not after Executive attains age
65), Executive shall continue to participate in those employee and executive
benefit plans and programs under Section 5(b) to the extent such
plans and programs provide medical insurance, disability insurance and life
insurance benefits (but not other benefits, such as pension and retirement
benefits, provided under Section 5(b)) in which Executive was
participating immediately prior to termination, the terms of which allow
Executive’s continued participation, as if Executive had continued in
employment with the Company during such period; provided, however, that such
participation shall terminate, or the benefits under such plans and programs
shall be reduced, if and to the extent Executive becomes covered (or is
eligible to become covered) by plans of a subsequent employer or other entity
to which Executive provides services during such period providing comparable
benefits. If the terms of the Company plans and programs referred to in this Section 7(d)(viii) do
not allow Executive’s continued participation, Executive shall be paid a cash
payment equivalent on an after-tax basis to the value of the additional
benefits described in this Section 7(d)(viii) Executive would have
received under such plans or programs had Executive continued to be employed
during such period, with such benefits provided by the Company at the same
times and in the same manner as such benefits would have been provided to
Executive under such plans and programs (it being understood that the value of
any insurance-provided benefits will be based on the premium cost to Executive,
which shall not exceed the highest risk premium charged by a carrier having an
investment grade or better credit rating); provided, however, that Executive
must continue to satisfy the conditions set forth in Section 10 in order
to continue receiving the benefits provided under this Section 7(d)(viii).
Executive agrees to promptly notify the Company of any employment or other
arrangement by which Executive provides services during the benefits-continuation
period and of the nature and extent of benefits for which Executive becomes
eligible during such period which would reduce or terminate benefits under this
Section 7(d)(viii); and the Company shall be entitled to recover from
Executive any payments and the fair market value of benefits previously made or
provided to Executive hereunder which would not have been paid under this Section 7(d)(viii) if
the Company had received adequate prior notice as required by this sentence.

 

If any payment or benefit
under this Section 7(d) is based on Base Salary or other level of
compensation or benefits at the time of Executive’s termination and if a
reduction in such Base Salary or other level of compensation or benefit was the
basis for Executive’s termination for Good Reason, then the Base Salary or
other level of compensation in effect before such reduction shall be used to
calculate payments or benefits under this Section 7(d).

 

(e)                                  Termination
by the Company Without Cause Within Two Years After a Change in Control. The
Company may terminate the employment of Executive hereunder without Cause,
simultaneously with or within two years after a Change in Control, upon at
least 90 days’ written notice to Executive. The foregoing notwithstanding, the
Company may elect, by written notice to Executive, to terminate Executive’s
positions specified in Sections 1 and 3 and all other obligations of Executive
and the Company under Section 3 at a date earlier than the expiration of
such 90-day notice period, if so specified by the Company in the written
notice, provided that Executive shall be treated as an employee of the Company
(without any assigned duties) for all other purposes of this Agreement,
including for purposes of Sections 4 and 5, from such specified date until the
expiration of such 90-day period. An election by the Company not to extend the
Term pursuant to Section 2 hereof shall be deemed to be a termination of
Executive’s employment by the Company without Cause at the date of expiration
of the Term and shall be subject to this Section 7(e) if the date of
such termination coincides with or is within two years after a Change in
Control; provided, however, that, if Executive has attained age 65 at such date
of termination, such termination shall be deemed a Retirement of Executive. At
the time Executive’s employment is terminated by the Company (i.e., at the
expiration of such notice period), the Term will terminate, all remaining
obligations of the Company and Executive under Sections 1 through 5 of this
Agreement will immediately cease (except for obligations which continue after
termination of employment as expressly provided herein), and the Company will
pay Executive, and Executive will be entitled to receive, the following:

 

12

 

(i)                                     Executive’s
Compensation Accrued at Termination;

 

(ii)                                  Cash
in an aggregate amount equal to three times the sum of (A) Executive’s
Base Salary under Section 4(a) immediately prior to termination plus (B) an
amount equal to the greater of (x) the portion of Executive’s annual target
incentive compensation potentially payable in cash to Executive (i.e.,
excluding the portion payable in PERS or in other non-cash awards) for the year
of termination or (y) the portion of Executive’s annual incentive compensation
that became payable in cash to Executive (i.e., excluding the portion payable
in PERS or in other non-cash awards) for the latest year preceding the year of
termination based on performance actually achieved in that latest year. The
amount determined to be payable under this Section 7(e)(ii) shall be
paid by the Company not later than 15 days after Executive’s termination;

 

(iii)                               In
lieu of any annual incentive compensation under Section 4(b) for the
year in which Executive’s employment terminated, an amount equal to the portion
of Executive’s annual target incentive compensation potentially payable in cash
to Executive (i.e., excluding the portion payable in PERS or in other non-cash
awards) for the year of termination, multiplied by a fraction the numerator of
which is the number of days Executive was employed in the year of termination
and the denominator of which is the total number of days in the year of
termination;

 

(iv)                              Stock
options held by Executive at termination, if not then vested and exercisable,
will become fully vested and exercisable at the date of such termination, and
any such options granted on or after the date hereof shall remain outstanding
and exercisable until the stated expiration date of the Option as though
Executive’s employment did not terminate, and, in other respects, such options
shall be governed by the plans and programs and the agreements and other
documents pursuant to which such options were granted;

 

(v)                                 Any
performance objectives upon which the earning of performance-based restricted
stock and deferred stock awards, including outstanding PERS awards, and other
long-term incentive awards is conditioned shall be deemed to have been met at
target level at the date of termination, and restricted stock and deferred
stock awards, including outstanding PERS awards, and other long-term incentive
awards (to the extent then or previously earned, in the case of
performance-based awards) shall become fully vested and non-forfeitable at the
date of such termination, and, in other respects, such awards shall be governed
by the plans and programs and the agreements and other documents pursuant to
which such awards were granted;

 

(vi)                              All
deferral arrangements under Section 5(d) will be settled in accordance
with the plans and programs governing the deferral;

 

(vii)                           All
rights under any other benefit plan shall be governed by such plan (subject to Section 5(b));
provided, however, that for purposes of any retirement benefit payable under Section 5(b)(iv) or
any other non-qualified defined benefit program under which Executive is
eligible for benefits, Executive will be credited with three additional years
of age (for all purposes) and three additional years of service (for purposes
of vesting and determining retirement benefits based on the number of years of
service); and

 

(viii)                        For a
period of three years after such termination (but not after Executive attains
age 65), Executive shall continue to participate in those employee and
executive benefit plans and programs under Section 5(b) to the extent
such plans and programs provide medical insurance, disability insurance and
life insurance benefits (but not other benefits, such as pension and retirement
benefits, provided under Section 5(b)) in which Executive was
participating immediately prior to termination, the terms of which allow
Executive’s continued participation, as if Executive had continued in
employment with the Company during such period; provided, however, that such
participation shall terminate, or the benefits under such plans and programs
shall be reduced, if and to the extent Executive becomes covered (or is
eligible to become covered) by plans of a subsequent employer or other entity
to which Executive provides services during such period providing comparable
benefits. If the terms of the Company plans and programs referred to in this
Section

 

13

 

7(e)(viii) do not
allow Executive’s continued participation, Executive shall be paid a cash
payment equivalent on an after-tax basis to the value of the additional
benefits described in this Section 7(e)(viii) Executive would have
received under such plans or programs had Executive continued to be employed
during such period, with such benefits provided by the Company at the same
times and in the same manner as such benefits would have been provided to
Executive under such plans and programs (it being understood that the value of
any insurance-provided benefits will be based on the premium cost to Executive,
which shall not exceed the highest risk premium charged by a carrier having an
investment grade or better credit rating); provided, however, that Executive
must continue to satisfy the conditions set forth in Section 10 in order
to continue receiving the benefits provided under this Section 7(e)(viii).
Executive agrees to promptly notify the Company of any employment or other
arrangement by which Executive provides services during the
benefits-continuation period and of the nature and extent of benefits for which
Executive becomes eligible during such period which would reduce or terminate
benefits under this Section 7(e)(viii); and the Company shall be entitled
to recover from Executive any payments and the fair market value of benefits
previously made or provided to Executive hereunder which would not have been
paid under this Section 7(e)(viii) if the Company had received
adequate prior notice as required by this sentence.

 

(f)                                    Termination
by Executive for Good Reason Within Two Years After a Change in Control. Executive
may terminate his employment hereunder for Good Reason, simultaneously
with or within two years after a Change in Control, upon 90 days’ written
notice to the Company; provided, however, that, if the Company has corrected
the basis for such Good Reason within 30 days after receipt of such notice,
Executive may not terminate his employment for Good Reason, and therefore
Executive’s notice of termination will automatically become null and void. At
the time Executive’s employment is terminated by Executive for Good Reason
(i.e., at the expiration of such notice period), the Term will terminate, all
obligations of the Company and Executive under Sections 1 through 5 of this
Agreement will immediately cease (except for obligations which continue after
termination of employment as expressly provided herein), and the Company will
pay Executive, and Executive will be entitled to receive, the following:

 

(i)                                     Executive’s
Compensation Accrued at Termination;

 

(ii)                                  Cash
in an aggregate amount equal to three times the sum of (A) Executive’s
Base Salary under Section 4(a) immediately prior to termination plus (B) an
amount equal to the greater of (x) the portion of Executive’s annual target
incentive compensation potentially payable in cash to Executive (i.e.,
excluding the portion payable in PERS or in other non-cash awards) for the year
of termination or (y) the portion of Executive’s annual incentive compensation
that became payable in cash to Executive (i.e., excluding the portion payable
in PERS or in other non-cash awards) for the latest year preceding the year of
termination based on performance actually achieved in that latest year. The
amount determined to be payable under this Section 7(f)(ii) shall be
paid by the Company not later than 15 days after Executive’s termination;

 

(iii)                               In
lieu of any annual incentive compensation under Section 4(b) for the
year in which Executive’s employment terminated, an amount equal to the portion
of Executive’s annual target incentive compensation potentially payable in cash
to Executive (i.e., excluding the portion payable in PERS or in other non-cash
awards) for the year of termination, multiplied by a fraction the numerator of
which is the number of days Executive was employed in the year of termination
and the denominator of which is the total number of days in the year of
termination;

 

(iv)                              Stock
options held by Executive at termination, if not then vested and exercisable,
will become fully vested and exercisable at the date of such termination, and
any such options granted on or after the date hereof shall remain outstanding
and exercisable until the stated expiration date of the Option as though
Executive’s employment did not terminate, and, in other respects, such options
shall be governed by the plans and programs and the agreements and other
documents pursuant to which such options were granted;

 

(v)                                 Any
performance objectives upon which the earning of performance-based restricted
stock and deferred stock awards, including outstanding PERS awards, and other
long-term incentive

 

14

 

awards is conditioned
shall be deemed to have been met at target level at the date of termination,
and restricted stock and deferred stock awards, including outstanding PERS
awards, and other long-term incentive awards (to the extent then or previously
earned, in the case of performance-based awards) shall become fully vested and
non-forfeitable at the date of such termination, and, in other respects, such
awards shall be governed by the plans and programs and the agreements and other
documents pursuant to which such awards were granted;

 

(vi)                              All
deferral arrangements under Section 5(d) will be settled in
accordance with the plans and programs governing the deferral;

 

(vii)                           All rights
under any other benefit plan shall be governed by such plan (subject to Section 5(b));
provided, however, that for purposes of any retirement benefit payable under Section 5(b)(iv) or
any other non-qualified defined benefit program under which Executive is
eligible for benefits, Executive will be credited with three additional years
of age (for all purposes) and three additional years of service (for purposes
of vesting and determining retirement benefits based on the number of years of
service) unless Executive’s Good Reason is based solely on Good Reason as
defined in Section 8(e)(ix); and

 

(viii)                        For a
period of three years after such termination (but not after Executive attains
age 65), Executive shall continue to participate in those employee and executive
benefit plans and programs under Section 5(b) to the extent such
plans and programs provide medical insurance, disability insurance and life
insurance benefits (but not other benefits, such as pension and retirement
benefits, provided under Section 5(b)) in which Executive was
participating immediately prior to termination, the terms of which allow
Executive’s continued participation, as if Executive had continued in
employment with the Company during such period; provided, however, that such
participation shall terminate, or the benefits under such plans and programs
shall be reduced, if and to the extent Executive becomes covered (or is
eligible to become covered) by plans of a subsequent employer or other entity
to which Executive provides services during such period providing comparable
benefits. If the terms of the Company plans and programs referred to in this
Section 7(f)(viii) do not allow Executive’s continued participation,
Executive shall be paid a cash payment equivalent on an after-tax basis to the
value of the additional benefits described in this Section 7(f)(viii) Executive
would have received under such plans or programs had Executive continued to be
employed during such period, with such benefits provided by the Company at the
same times and in the same manner as such benefits would have been provided to
Executive under such plans and programs (it being understood that the value of
any insurance-provided benefits will be based on the premium cost to Executive,
which shall not exceed the highest risk premium charged by a carrier having an
investment grade or better credit rating); provided, however, that Executive
must continue to satisfy the conditions set forth in Section 10 in order
to continue receiving the benefits provided under this Section 7(f)(viii).
Executive agrees to promptly notify the Company of any employment or other
arrangement by which Executive provides services during the
benefits-continuation period and of the nature and extent of benefits for which
Executive becomes eligible during such period which would reduce or terminate
benefits under this Section 7(f)(viii); and the Company shall be entitled
to recover from Executive any payments and the fair market value of benefits
previously made or provided to Executive hereunder which would not have been
paid under this Section 7(f)(viii) if the Company had received
adequate prior notice as required by this sentence.

 

If any payment or benefit
under this Section 7(f) is based on Base Salary or other level of
compensation or benefits at the time of Executive’s termination and if a
reduction in such Base Salary or other level of compensation or benefit was the
basis for Executive’s termination for Good Reason, then the Base Salary or
other level of compensation in effect before such reduction shall be used to
calculate payments or benefits under this Section 7(f).

 

(g)                                 Other
Terms Relating to Certain Terminations of Employment. Whether a termination
is deemed to be at or within two years after a Change in Control for purposes
of Sections 7(c), (d), (e), or (f) is determined at the date of
termination, regardless of whether the Change in Control had occurred at the
time a notice of termination was given. In the event Executive’s employment
terminates for any reason set forth in

 

15

 

Section 7(b) through
(f), Executive will be entitled to the benefit of any terms of plans or
agreements applicable to Executive which are more favorable than those
specified in this Section 7 (except in the case of annual incentives in
lieu of which amounts are paid hereunder). Amounts payable under this Section 7
following Executive’s termination of employment, other than those expressly
payable on a deferred basis, will be paid as promptly as practicable after such
a termination of employment, and such amounts payable under Section 7(e) or
7(f) will be paid in no event later than 15 days after Executive’s
termination of employment unless not determinable within such period.

 

8.                                       Definitions
Relating to Termination Events.

 

(a)                                  “Cause.”  For purposes of this Agreement, “Cause” shall
mean Executive’s

 

(i)                                     willful
and continued failure to substantially perform his duties hereunder (other
than any such failure resulting from incapacity due to physical or mental illness
or disability or any failure after the issuance of a notice of termination by
Executive for Good Reason) which failure is demonstrably and materially
damaging to the financial condition or reputation of the Company and/or its
subsidiaries, and which failure continues more than 48 hours after a written
demand for substantial performance is delivered to Executive by the Board,
which demand specifically identifies the manner in which the Board believes
that Executive has not substantially performed his duties hereunder and the
demonstrable and material damage caused thereby; or

 

(ii)                                  the
willful engaging by Executive in conduct which is demonstrably and materially
injurious to the Company, monetarily or otherwise.

 

No act, or failure to
act, on the part of Executive shall be deemed “willful” unless done, or
omitted to be done, by Executive not in good faith and without reasonable
belief that his action or omission was in the best interest of the Company. Notwithstanding
the foregoing, Executive shall not be deemed to have been terminated for Cause
unless and until there shall have been delivered to Executive a copy of the
resolution duly adopted by the affirmative vote of not less than three-quarters
(3/4) of the entire membership of the Board at a meeting of the Board (after
reasonable notice to Executive and an opportunity for Executive, together with
Executive’s counsel, to be heard before the Board) finding that, in the good
faith opinion of the Board, Executive was guilty of conduct set forth above in
this definition and specifying the particulars thereof in detail.

 

(b)                                 “Change
in Control.” For purposes of this Agreement, a “Change in Control” shall be
deemed to have occurred if, during the term of this Agreement:

 

(i)                                     any
“Person,” as such term is used for purposes of Section 13(d) or 14(d) of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (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” (as defined in Rule 13d-3 under the Exchange Act), 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
effectiveness of this Agreement), 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 (8)(b)(i), (iii) or (iv) hereof,
(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

 

16

 

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;

 

(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; or

 

(v)                                 the
Board adopts a resolution to the effect that, for purposes of this Agreement, a
Change in Control has occurred.

 

(c)                                  “Compensation
Accrued at Termination.”  For
purposes of this Agreement, “Compensation Accrued at Termination” means the
following:

 

(i)                                     The
unpaid portion of annual base salary at the rate payable, in accordance with Section 4(a) hereof,
at the date of Executive’s termination of employment, pro rated through such date
of termination, payable in accordance with the Company’s regular pay schedule;

 

(ii)                                  All
vested, nonforfeitable amounts owing or accrued at the date of Executive’s
termination of employment under any compensation and benefit plans, programs,
and arrangements set forth or referred to in Sections 4(b) and 5(a) and
5(b) hereof (including any earned and vested annual incentive
compensation, and long-term incentive award) in which Executive theretofore
participated, payable in accordance with the terms and conditions of the plans,
programs, and arrangements (and agreements and documents thereunder) pursuant
to which such compensation and benefits were granted or accrued; and

 

(iii)                               Reasonable
business expenses and disbursements incurred by Executive prior to Executive’s
termination of employment, to be reimbursed to Executive, as authorized under Section 5(f),
in accordance the Company’s reimbursement policies as in effect at the date of
such termination.

 

(d)                                 “Disability.”  For purposes of this Agreement, “Disability”
means Executive’s absence from the full-time performance of Executive’s duties
hereunder for six consecutive months as a result of his incapacity due to
physical or mental illness or disability, and, within 30 days after written
notice of termination is thereafter given by the Company, Executive shall have
not returned to the full-time performance of such duties.

 

(e)                                  “Good
Reason.”  For purposes of this
Agreement, “Good Reason” shall mean, without Executive’s express written
consent, the occurrence of any of the following circumstances unless, in the
case of subsections (i), (iv), (vi) or (viii) hereof, such
circumstances are fully corrected prior to the date of termination specified in
the notice of termination given in respect thereof:

 

(i)                                     the
assignment to Executive of duties inconsistent with Executive’s position and
status hereunder, or an alteration, adverse to Executive, in the nature of
Executive’s duties, responsibilities, and authorities, Executive’s positions or
the conditions of Executive’s employment from those specified in Section 3
or otherwise hereunder (other than inadvertent actions which are promptly
remedied); for this purpose, it shall constitute “Good Reason” under this subsection (e)(i) if
Executive shall be required to report to and take direction from any person or
body other than the Chief Executive Officer of the Company and the Board,
except the foregoing shall not constitute Good Reason if occurring in
connection with the termination of Executive’s employment for Cause,
Disability, Retirement, as a result of Executive’s death, or as a result of
action by or with the consent

 

17

 

of Executive; for
purposes of this Section 8(e)(i), references to the Company (and the Board
and stockholders of the Company) refer to the ultimate parent company (and its
board and stockholders) succeeding the Company following an acquisition in
which the corporate existence of the Company continues, in accordance with Section 12(b);

 

(ii)                                  (A) a
reduction by the Company in Executive’s Base Salary, (B) the setting of
Executive’s annual target incentive opportunity or payment of earned annual
incentive in amounts less than specified under or otherwise not in conformity
with Section 4 hereof, (C) a change in compensation or benefits not
in conformity with Section 5, or (D) a reduction, after a Change in
Control in perquisites from the level of such perquisites as in effect
immediately prior to the Change in Control or as the same may have been
increased from time to time after the Change in Control except for
across-the-board perquisite reductions similarly affecting all senior
executives of the Company and all senior executives of any Person in control of
the Company;

 

(iii)                               the
relocation of the principal place of Executive’s employment not in conformity
with Section 3(b) hereof; for this purpose, required travel on the
Company’s business will not constitute a relocation so long as the extent of
such travel is substantially consistent with Executive’s customary business
travel obligations in periods prior to the Restatement Date. During a
reasonable period following the Restatement Date, Executive will make the
transition between the principal place of his employment prior to the
Restatement Date (governed by the Agreement as then in effect) and the
principal place of employment specified in Section 3(b) as of the
Restatement Date. Such transition will not be deemed to breach Section 3(b) or
give rise to Good Reason hereunder;

 

(iv)                              the
failure by the Company to pay to Executive any portion of Executive’s
compensation or to pay to Executive any portion of an installment of deferred
compensation under any deferred compensation program of the Company within
seven days of the date such compensation is due;

 

(v)                                 the
failure by the Company to continue in effect any material compensation or
benefit plan in which Executive participated immediately prior to a Change in
Control, unless an equitable arrangement (embodied in an ongoing substitute or
alternative plan) has been made with respect to such plan, or the failure by
the Company to continue Executive’s participation therein (or in such
substitute or alternative plan) on a basis not materially less favorable, both
in terms of the amounts of compensation or benefits provided and the level of
Executive’s participation relative to other participants, as existed at the
time of the Change in Control;

 

(vi)                              the
failure of the Company to obtain a satisfactory agreement from any successor to
the Company to fully assume the Company’s obligations and to perform under
this Agreement, as contemplated in Section 12(b) hereof, in a form reasonably
acceptable to Executive;

 

(vii)                           any
election by the Company not to extend the Term of this Agreement at the next
possible extension date under Section 2 hereof, unless Executive will have
attained age 65 at or before such extension date;

 

(viii)                        any other
failure by the Company to perform any material obligation under, or breach
by the Company of any material provision of, this Agreement; or

 

(ix)                                Executive
determines, in his sole discretion,  that
any other circumstance constitutes “Good Reason” or otherwise determines to
terminate his employment hereunder, subject to 90 days’ notice.

 

(f)                        “Potential
Change in Control”  For purposes of this
Agreement, a “Change in Control” shall be deemed to have occurred if, during
the term of this Agreement:

 

(i)                                     the
Company enters into an agreement, the consummation of which would result in the
occurrence of a Change in Control;

 

18

 

(ii)                                  any
Person (including the Company) publicly announces an intention to take or to
consider taking actions which if consummated would constitute a Change in
Control; or

 

(iii)                               the
Board adopts a resolution to the effect that, for purposes of this Agreement, a
Potential Change in Control has occurred.

 

9.                                                Rabbi
Trust Obligation Upon Potential Change in Control; Excise Tax-Related
Provisions.

 

(a)                      Rabbi
Trust Funded Upon Potential Change in Control. In the event of a Potential
Change in Control or Change in Control, the Company shall, not later than 15
days thereafter, have established one or more rabbi trusts and shall deposit
therein cash in an amount sufficient to provide for full payment of all
potential obligations of the Company that would arise assuming consummation of
a Change in Control, or has arisen in the case of an actual Change in Control,
and a subsequent termination of Executive’s employment under Section 7(e) or
7(f). Such rabbi trust(s) shall be irrevocable and shall provide that the
Company may not, directly or indirectly, use or recover any assets of the
trust(s) until such time as all obligations which potentially could arise
hereunder have been settled and paid in full, subject only to the claims of
creditors of the Company in the event of insolvency or bankruptcy of the
Company; provided, however, that if no Change in Control has occurred within
two years after such Potential Change in Control, such rabbi trust(s) shall at
the end of such two-year period become revocable and may thereafter be
revoked by the Company.

 

(b)                     Gross-up
If Excise Tax Would Apply. In the event Executive becomes entitled to any
amounts or benefits payable in connection with a Change in Control or other
change in control (whether or not such amounts are payable pursuant to this
Agreement) (the “Severance Payments”), if any of such Severance Payments are
subject to the tax (the “Excise Tax”) imposed by Section 4999 of the
Internal Revenue Code (or any similar federal, state or local tax that may hereafter
be imposed) (the “Code”), the Company shall pay to Executive at the time
specified in Section 9(b)(iii) hereof an additional amount (the “Gross-Up
Payment”) such that the net amount retained by Executive, after deduction of
any Excise Tax on the Total Payments (as hereinafter defined) and any federal,
state and local income tax and Excise Tax upon the payment provided for by Section 9(b)(i),
shall be equal to the Total Payments.

 

(i)                                     For
purposes of determining whether any of the Severance Payments will be subject
to the Excise Tax and the amount of such Excise Tax:

 

(A)                              any
other payments or benefits received or to be received by Executive in
connection with a Change in Control or Executive’s termination of employment
(whether pursuant to the terms of this Agreement or any other plan, arrangement
or agreement with the Company, any Person whose actions result in a Change in
Control or any Person affiliated with the Company or such Person) (which,
together with the Severance Payments, constitute the “Total Payments”) shall be
treated as “parachute payments” within the meaning of Section 280G(b)(2) of
the Code, and all “excess parachute payments” within the meaning of Section 280G(b)(1) of
the Code shall be treated as subject to the Excise Tax, unless in the opinion
of nationally-recognized tax counsel selected by Executive such other payments
or benefits (in whole or in part) do not constitute parachute payments, or such
excess parachute payments (in whole or in part) represent reasonable compensation
for services actually rendered within the meaning of Section 280G(b)(4) of
the Code in excess of the base amount within the meaning of Section 280G(b)(3) of
the Code, or are otherwise not subject to the Excise Tax;

 

(B)                                the
amount of the Total Payments which shall be treated as subject to the Excise
Tax shall be equal to the lesser of (x) the total amount of the Total Payments
and (y) the amount of excess parachute payments within the meaning of Section 280G(b)(1) of
the Code (after applying Section 9(b)(i)(A) hereof); and

 

(C)                                the
value of any non-cash benefits or any deferred payments or benefit shall be
determined by a nationally-recognized accounting firm selected by Executive in
accordance with the principles of Sections 280G(d)(3) and (4) of the
Code.

 

19

 

(ii)                                  For
purposes of determining the amount of the Gross-Up Payment, Executive shall be
deemed to pay federal income taxes at the highest marginal rate of federal
income taxation in the calendar year in which the Gross-Up Payment is to be
made and state and local income taxes at the highest marginal rate of taxation
in the state and locality of Executive’s residence on the Date of Termination,
net of the maximum reduction in federal income taxes which could be obtained
from deduction of such state and local taxes. In the event that the Excise Tax
is subsequently determined to be less than the amount taken into account
hereunder at the time of termination of Executive’s employment, Executive shall
repay to the Company within ten days after the time that the amount of such
reduction in Excise Tax is finally determined the portion of the Gross-Up
Payment attributable to such reduction (plus the portion of the Gross-Up
Payment attributable to the Excise Tax and federal and state and local income
tax imposed on the Gross-Up Payment being repaid by Executive if such repayment
results in a reduction in Excise Tax and/or federal and state and local income
tax deduction) plus interest on the amount of such repayment at the rate
provided in Section 1274(b)(2)(B) of the Code. In the event that the
Excise Tax is determined to exceed the amount taken into account hereunder at
the time of the termination of Executive’s employment (including by reason of
any payment the existence or amount of which cannot be determined at the time
of the Gross-Up Payment), the Company shall make an additional gross-up payment
in respect of such excess within ten days after the time that the amount of
such excess is finally determined.

 

(iii)                               The
payments provided for in this Section 9(b) shall be made not later
than the fifteenth day following the date of Executive’s termination of
employment; provided, however, that if the amount of such payments
cannot be finally determined on or before such day, the Company shall pay to
Executive on such day an estimate, as determined in good faith by the Company,
of the minimum amount of such payments and shall pay the remainder of such
payments (together with interest at the rate provided in Section 1274(b)(2)(B) of
the Code) as soon as the amount thereof can be determined but in no event later
than the thirtieth day after the date of Executive’s termination of employment.
In the event that the amount of the estimated payments exceeds the amount subsequently
determined to have been due, such excess shall constitute a loan by the Company
to Executive, payable on the fifteenth day after the demand by the Company
(together with interest at the rate provided in Section 1274(b)(2)(B) of
the Code).

 

(iv)                              All
determinations under this Section 9(b) shall be made at the expense
of the Company by a nationally recognized public accounting firm selected by
Executive, and such determination shall be binding upon Executive and the
Company.

 

10.                                          Non-Competition
and Non-Disclosure; Executive Cooperation; Non-Disparagement.

 

(a)                      Non-Competition.
Without the consent in writing of the Board, Executive will not, at any time
during the Term and for a period of two years following termination of
Executive’s employment for any reason, acting alone or in conjunction with
others, directly or indirectly (i) engage (either as owner, investor,
partner, stockholder, employer, employee, consultant, advisor, or director) in
any business in which he has been directly engaged on behalf of the Company or
any affiliate, or has supervised as an executive thereof, during the last two
years prior to such termination, or which was engaged in or planned by the
Company or an affiliate at the time of such termination, in any geographic area
in which such business was conducted or planned to be conducted; (ii) induce
any customers of the Company or any of its affiliates with whom Executive has
had contacts or relationships, directly or indirectly, during and within the
scope of his employment with the Company or any of its affiliates, to curtail
or cancel their business with the Company or any such affiliate; (iii) induce,
or attempt to influence, any employee of the Company or any of its affiliates
to terminate employment; or (iv) solicit, hire or retain as an employee or
independent contractor, or assist any third party in the solicitation, hire, or
retention as an employee or independent contractor, any person who during the
previous 12 months was an employee of the Company or any affiliate; provided,
however, that the limitation contained in clause (i) above shall not
apply if Executive’s employment is terminated as a result of a termination by
the Company without Cause within two years following a Change in Control or is
terminated by Executive for Good Reason within two years following a Change in
Control, and provided further, that activities engaged in by or on behalf of
the Company are not restricted by this covenant. The provisions of
subparagraphs (i), (ii), (iii), and

 

20

 

(iv) above are
separate and distinct commitments independent of each of the other
subparagraphs. It is agreed that the ownership of not more than one percent of
the equity securities of any company having securities listed on an exchange or
regularly traded in the over-the-counter market shall not, of itself, be deemed
inconsistent with clause (i) of this Section 10(a).

 

(b)                     Non-Disclosure;
Ownership of Work. Executive shall not, at any time during the Term and
thereafter (including following Executive’s termination of employment for any
reason), disclose, use, transfer, or sell, except in the course of employment
with or other service to the Company, any proprietary information, secrets,
organizational or employee information, or other confidential information
belonging or relating to the Company and its affiliates and customers so long
as such information has not otherwise been disclosed or is not otherwise in the
public domain, except as required by law or pursuant to legal process. In
addition, upon termination of employment for any reason, Executive will return
to the Company or its affiliates all documents and other media containing
information belonging or relating to the Company or its affiliates. Executive
will promptly disclose in writing to the Company all inventions, discoveries,
developments, improvements and innovations (collectively referred to as “Inventions”)
that Executive has conceived or made during the Term; provided, however,
that in this context “Inventions” are limited to those which (i) relate in
any manner to the existing or contemplated business or research activities of
the Company and its affiliates; (ii) are suggested by or result from
Executive’s work at the Company; or (iii) result from the use of the time,
materials or facilities of the Company and its affiliates. All Inventions will
be the Company’s property rather than Executive’s. Should the Company request
it, Executive agrees to sign any document that the Company may reasonably
require to establish ownership in any Invention.

 

(c)                      Cooperation
With Regard to Litigation. Executive agrees to cooperate with the Company,
during the Term and thereafter (including following Executive’s termination of
employment for any reason), by making himself available to testify on behalf of
the Company or any subsidiary or affiliate of the Company, in any action, suit,
or proceeding, whether civil, criminal, administrative, or investigative, and
to assist the Company, or any subsidiary or affiliate of the Company, in any
such action, suit, or proceeding, by providing information and meeting and
consulting with the Board or its representatives or counsel, or representatives
or counsel to the Company, or any subsidiary or affiliate of the Company, as
requested. The Company agrees to reimburse the Executive, on an after-tax
basis, for all expenses actually incurred in connection with his provision of
testimony or assistance.

 

(d)                     Non-Disparagement.
Executive shall not, at any time during the Term and thereafter, make
statements or representations, or otherwise communicate, directly or
indirectly, in writing, orally, or otherwise, or take any action which may,
directly or indirectly, disparage the Company or any of its subsidiaries or
affiliates or their respective officers, directors, employees, advisors,
businesses or reputations. Notwithstanding the foregoing, nothing in this
Agreement shall preclude Executive from making truthful statements that are
required by applicable law, regulation or legal process.

 

(e)                      Release
of Employment Claims. Executive agrees, as a condition to receipt of any
termination payments and benefits provided for in Sections 6 and 7 herein
(other than Compensation Accrued at Termination), that he will execute a
general release agreement, in a form satisfactory to the Company,
releasing any and all claims arising out of Executive’s employment other than
enforcement of this Agreement and rights to indemnification under any
agreement, law, Company organizational document or policy, or otherwise.

 

(f)                        Forfeiture
of Outstanding Options. The provisions of Sections 6 and 7 notwithstanding,
if Executive willfully and materially fails to substantially comply with any
restrictive covenant under this Section 10 or willfully and materially
fails to substantially comply with any material obligation under this
Agreement, all options to purchase Common Stock granted by the Company and then
held by Executive or a transferee of Executive shall be immediately forfeited
and thereupon such options shall be cancelled. Notwithstanding the foregoing,
Executive shall not forfeit any option unless and until there shall have been
delivered to him, within six months after the Board (i) had knowledge of
conduct or an event allegedly constituting grounds for such forfeiture and (ii) had
reason to believe that such conduct or event could be grounds for such
forfeiture, a copy of a resolution duly adopted by a majority affirmative vote
of the membership of the Board (excluding Executive) at a meeting of the Board
called and held for such purpose (after giving Executive reasonable

 

21

 

notice specifying the
nature of the grounds for such forfeiture and not less than 30 days to correct
the acts or omissions complained of, if correctable, and affording Executive
the opportunity, together with his counsel, to be heard before the Board)
finding that, in the good faith opinion of the Board, Executive has engaged and
continues to engage in conduct set forth in this Section 10(f) which
constitutes grounds for forfeiture of Executive’s options; provided, however,
that if any option is exercised after delivery of such notice and the Board
subsequently makes the determination described in this sentence, Executive
shall be required to pay to the Company an amount equal to the difference
between the aggregate value of the shares acquired upon such exercise at the
date of the Board determination and the aggregate exercise price paid by
Executive. Any such forfeiture shall apply to such options notwithstanding any
term or provision of any option agreement. In addition, options granted to
Executive on or after January 1, 2000, and gains resulting from the
exercise of such options, shall be subject to forfeiture in accordance with the
Company’s standard policies relating to such forfeitures and clawbacks, as such
policies are in effect at the time of grant of such options.

 

(g)                     Survival.
The provisions of this Section 10 shall survive the termination of the
Term and any termination or expiration of this Agreement.

 

11.                                          Governing
Law; Disputes; Arbitration.

 

(a)                      Governing
Law. This Agreement is governed by and is to be construed, administered,
and enforced in accordance with the laws of the State of Connecticut, without
regard to conflicts of law principles, except insofar as federal laws and
regulations and the Delaware General Corporation Law may be applicable. If
under the governing law, any portion of this Agreement is at any time deemed to
be in conflict with any applicable statute, rule, regulation, ordinance, or
other principle of law, such portion shall be deemed to be modified or altered
to the extent necessary to conform thereto or, if that is not possible, to
be omitted from this Agreement. The invalidity of any such portion shall not
affect the force, effect, and validity of the remaining portion hereof. If any
court determines that any provision of Section 10 is unenforceable because
of the duration or geographic scope of such provision, it is the parties’
intent that such court shall have the power to modify the duration or
geographic scope of such provision, as the case may be, to the extent
necessary to render the provision enforceable and, in its modified form, such
provision shall be enforced.

 

(b)                     Reimbursement
of Expenses in Enforcing Rights. All reasonable costs and expenses
(including fees and disbursements of counsel) incurred by Executive in seeking
to interpret this Agreement or enforce rights pursuant to this Agreement shall
be paid on behalf of or reimbursed to Executive promptly by the Company,
whether or not Executive is successful in asserting such rights; provided,
however, that no reimbursement shall be made of such expenses relating to any
unsuccessful assertion of rights if and to the extent that Executive’s
assertion of such rights was in bad faith or frivolous, as determined by
arbitrators in accordance with Section 11(c) or a court having
jurisdiction over the matter.

 

(c)                      Arbitration.
Any dispute or controversy arising under or in connection with this Agreement
shall be settled exclusively by arbitration in Westport, CT, by three
arbitrators in accordance with the rules of the American Arbitration
Association in effect at the time of submission to arbitration. Judgment may be
entered on the arbitrators’ award in any court having jurisdiction. For
purposes of entering any judgment upon an award rendered by the arbitrators,
the Company and Executive hereby consent to the jurisdiction of any or all of
the following courts: (i) the United States District Court for the
District of Connecticut, (ii) any of the courts of the State of
Connecticut, or (iii) any other court having jurisdiction. The Company and
Executive further agree that any service of process or notice requirements in
any such proceeding shall be satisfied if the rules of such court relating
thereto have been substantially satisfied. The Company and Executive hereby
waive, to the fullest extent permitted by applicable law, any objection which
it may now or hereafter have to such jurisdiction and any defense of
inconvenient forum. The Company and Executive hereby agree that a judgment upon
an award rendered by the arbitrators may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Subject to Section 11(b), the Company shall bear all costs and expenses
arising in connection with any arbitration proceeding pursuant to this Section 11.
Notwithstanding any provision in this Section 11, Executive shall be
entitled to seek specific performance of Executive’s right to be paid during the
pendency of any dispute or controversy arising under or in connection with this
Agreement.

 

22

 

(d)                     Interest
on Unpaid Amounts. Any amount which has become payable pursuant to the
terms of this Agreement or any decision by arbitrators or judgment by a court
of law pursuant to this Section 11 but which has not been timely paid
shall bear interest at the prime rate in effect at the time such amount first
becomes payable, as quoted by the Company’s principal bank.

 

12.                                          Miscellaneous.

 

(a)                      Integration.
This Agreement cancels and supersedes any and all prior employment agreements
and understandings between the parties hereto with respect to the employment of
Executive by the Company, any parent or predecessor company, and the Company’s
subsidiaries during the Term, except for contracts relating to compensation
under executive compensation and employee benefit plans of the Company and its
subsidiaries. The foregoing notwithstanding, in the event of any conflict or ambiguity
between this Agreement and a Change-in-Control Agreement executed by Executive
and the Company, the provisions of this Agreement shall govern except that
Executive shall remain entitled to any right or benefit under a
Change-in-Control Agreement executed by the Company, for so long as such
Change-in-Control Agreement remains in effect, if and to the extent that such
right or benefit is more favorable to Executive than a corresponding provision
of this Agreement; but no payment or benefit under the Change-in-Control
Agreement shall be made or extended which duplicates any payment or benefit
hereunder. This Agreement constitutes the entire agreement among the parties
with respect to the matters herein provided, and no modification or waiver of
any provision hereof shall be effective unless in writing and signed by the
parties hereto. Executive shall not be entitled to any payment or benefit under
this Agreement which duplicates a payment or benefit received or receivable by
Executive under any prior agreements and understandings or under any benefit or
compensation plan of the Company which are in effect.

 

(b)                     Successors;
Transferability. The Company shall require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Agreement in the same manner and to the
same extent that the Company would be required to perform it if no such
succession had taken place.

 

As used in this
Agreement, “Company” shall mean IMS Health Incorporated or any wholly owned
subsidiary of IMS Health Incorporated domiciled in the United Kingdom to which
IMS Health Incorporated may assign its rights and obligations hereunder,
provided that the performance of all such obligations hereunder by such
subsidiary shall be guaranteed by IMS Health Incorporated, and references to
plans and programs shall refer to those of IMS Health Incorporated and its
subsidiaries. In addition, the term “Company” or “IMS Health Incorporated”
shall include any successor to the business and/or assets of IMS Health
Incorporated which assumes and agrees to perform this Agreement by
operation of law, or otherwise and, in the case of an acquisition of the
Company in which the corporate existence of the Company continues, the ultimate
parent company following such acquisition. Subject to the foregoing, the
Company may transfer and assign this Agreement and the Company’s rights
and obligations hereunder. Neither this Agreement nor the rights or obligations
hereunder of the parties hereto shall be transferable or assignable by
Executive, except in accordance with the laws of descent and distribution or as
specified in Section 12(b).

 

(c)                      Beneficiaries.
Executive shall be entitled to designate (and change, to the extent permitted
under applicable law) a beneficiary or beneficiaries to receive any
compensation or benefits provided hereunder following Executive’s death.

 

(d)                     Notices.
Whenever under this Agreement it becomes necessary to give notice, such notice
shall be in writing, signed by the party or parties giving or making the same,
and shall be served on the person or persons for whom it is intended or who
should be advised or notified, by Federal Express or other similar overnight
service or by certified or registered mail, return receipt requested, postage
prepaid and addressed to such party at the address set forth below or at such
other address as may be designated by such party by like notice:

 

If to
the Company:

 

IMS HEALTH INCORPORATED

 

23

 

1499 Post Road

Fairfield, CT 06824

Attention: Chief
Executive Officer

 

If to
Executive:

 

M.
Gilles Pajot

 

c/o Monica Kurnatowska

Baker & McKenzie LLP

100 New Bridge Street

London
EC4V 6JA

 

If the parties by mutual
agreement supply each other with telecopier numbers for the purposes of
providing notice by facsimile, such notice shall also be proper notice under
this Agreement. In the case of Federal Express or other similar overnight
service, such notice or advice shall be effective when sent, and, in the cases
of certified or registered mail, shall be effective two days after deposit into
the mails by delivery to the U.S. Post Office.

 

(e)                      Reformation.
The invalidity of any portion of this Agreement shall not be deemed to render
the remainder of this Agreement invalid.

 

(f)                        Headings.
The headings of this Agreement are for convenience of reference only and do not
constitute a part hereof.

 

(g)                     No General
Waivers. The failure of any party at any time to require performance by any
other party of any provision hereof or to resort to any remedy provided herein
or at law or in equity shall in no way affect the right of such party to
require such performance or to resort to such remedy at any time thereafter,
nor shall the waiver by any party of a breach of any of the provisions hereof
be deemed to be a waiver of any subsequent breach of such provisions. No such
waiver shall be effective unless in writing and signed by the party against whom
such waiver is sought to be enforced.

 

(h)                     No
Obligation To Mitigate. Executive shall not be required to seek other
employment or otherwise to mitigate Executive’s damages upon any termination of
employment, and any compensation or benefits received from any other employment
of Executive shall not mitigate or reduce the obligations of the Company or the
rights of Executive hereunder, except that, to the extent Executive receives
from a subsequent employer health or other insurance benefits that are similar
to the benefits referred to in Section 5(b) hereof, any such benefits
to be provided by the Company to Executive following the Term shall be
correspondingly reduced.

 

(i)                         Offsets;
Withholding. The amounts required to be paid by the Company to Executive pursuant
to this Agreement shall not be subject to offset other than with respect to any
amounts that are owed to the Company by Executive due to his receipt of funds
as a result of his fraudulent activity. The foregoing and other provisions of
this Agreement notwithstanding, all payments to be made to Executive under this
Agreement, including under Sections 6 and 7, or otherwise by the Company, will
be subject to withholding to satisfy required withholding taxes and other
required deductions.

 

(j)                         Successors
and Assigns. This Agreement shall be binding upon and shall inure to the
benefit of Executive, his heirs, executors, administrators and beneficiaries,
and shall be binding upon and inure to the benefit of the Company and its
successors and assigns.

 

(k)                      Counterparts.
This Agreement may be executed in counterparts, each of which shall be
deemed to be an original but all of which together will constitute one and the
same instrument.

 

24

 

13.                                 Indemnification.

 

All rights to
indemnification by the Company now existing in favor of the Executive as
provided in the Company’s Certificate of Incorporation or By-laws or pursuant
to other agreements in effect on or immediately prior to the Effective Date
shall continue in full force and effect from the Effective Date (including all
periods after the expiration of the Term), and the Company shall also advance
expenses for which indemnification may be ultimately claimed as such
expenses are incurred to the fullest extent permitted under applicable law,
subject to any requirement that the Executive provide an undertaking to repay
such advances if it is ultimately determined that the Executive is not entitled
to indemnification; provided, however, that any determination required to be
made with respect to whether the Executive’s conduct complies with the
standards required to be met as a condition of indemnification or advancement
of expenses under applicable law and the Company’s Certificate of
Incorporation, By-laws, or other agreement shall be made by independent counsel
mutually acceptable to the Executive and the Company (except to the extent
otherwise required by law). After the date hereof, the Company shall not amend
its Certificate of Incorporation or By-laws or any agreement in any manner
which adversely affects the rights of the Executive to indemnification
thereunder. Any provision contained herein notwithstanding, this Agreement
shall not limit or reduce any rights of the Executive to indemnification
pursuant to applicable law. In addition, the Company will maintain directors’
and officers’ liability insurance in effect and covering acts and omissions of
Executive during the Term and for a period of six years thereafter on terms
substantially no less favorable than those in effect on the Effective Date.

 

IN WITNESS WHEREOF,
Executive has hereunto set his hand and the Company has caused this instrument
to be duly executed as of the date of this Agreement set forth in Section 1
hereof.

 

 

	
   

  	
  IMS HEALTH INCORPORATED

  

 

	
   

  	
  By:

  	
  /s/ DAVID R. CARLUCCI

  	
   

  
	
   

  	
  Name: David R. Carlucci

  
	
   

  	
  Title: President and
  Chief Executive Officer

  

 

	
   

  	
   

  
	
   

  	
  /s/ GILLES PAJOT

  	
   

  
	
   

  	
  Gilles Pajot

  

 

25Exhibit 10.47.2

 

RESTRICTED STOCK UNIT
GRANT AGREEMENT

 

RESTRICTED STOCK UNITS
GRANTED UNDER THE

1998 IMS HEALTH
INCORPORATED EMPLOYEES’ STOCK INCENTIVE PLAN

 

This Restricted Stock Unit Grant Agreement, including the Terms and
Conditions attached hereto (together, the “Agreement”), confirms the grant of
Restricted Stock Units (“RSUs”) as of January
3, 2006 (the “Grant Date”) by the Compensation and Benefits
Committee (the “Committee”) of the Board of Directors of IMS Health
Incorporated (the “Company”) as follows:

 

	
   

  	
  Participant Granted RSUs:

  	
   

  	
  Gilles Pajot

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Number of RSUs Granted:

  	
   

  	
  39,856

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Scheduled Lapse Date:

  	
   

  	
  January 3, 2009

  	
   

  

 

The
RSUs are granted under the 1998 IMS Health Incorporated Employees’ Stock
Incentive Plan (the “Plan”).  The RSUs
are subject to all the terms and conditions of the Plan, which is attached
hereto and incorporated herein by reference, and are subject to the terms and
conditions of this Agreement and Participant’s Employment Agreement (as
specified below).

 

Participant acknowledges and agrees that (i) until an RSU has become
vested in accordance with Section 2(a) hereof, such RSU will be subject to a
risk of forfeiture to the extent provided in such Section 2, and (ii) until the
time each RSU becomes vested, such RSU shall be generally nontransferable, as
provided in Section 3 hereof.

 

The
grant of the RSUs and the Company’s obligations under this Agreement are
conditioned upon the execution by Participant of an Amendment and Restatement
of the Employment Agreement between Participant and the Company (the “Employment
Agreement”) the terms of which will provide, among other things, that the RSUs
are subject to a substantial risk of forfeiture from the time of grant.  This grant is the only grant of RSUs to
Participant made as of January 3, 2006, and this Agreement supersedes any other
grant agreement relating to 39,856 RSUs granted as of January 3, 2006.

 

IN WITNESS WHEREOF, IMS Health Incorporated has caused this Agreement
to be executed by its officer thereunto duly authorized, and Participant has
executed this Agreement.

 

By the Company’s and
Participant’s signature, the Company and Participant agree to the terms of this
Agreement.

 

	
  IMS HEALTH INCORPORATED

  	
   

  	
  PARTICIPANT

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/  DAVID R.
  CARLUCCI

  	
   

  	
  /s/  GILLES V.
  J. PAJOT

  
	
  David R. Carlucci

  President and Chief Executive Officer

  	
   

  	
  Gilles V. J. Pajot

  EVP and President, Global Business

  Management

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

 

TERMS AND
CONDITIONS

OF RESTRICTED
STOCK UNITS

 

 

1.             Restricted Stock Units

 

Each Restricted
Stock Unit (“RSU”) represents a generally nontransferable, conditional right to
receive one share of the Company’s Common Stock (a “Share”) at a specified
future date, together with a right to receive payments equivalent to dividends
paid on Shares (“Dividend Equivalents”) and other rights, subject to the terms
and conditions of the 1998 IMS Health Incorporated Employees’ Stock Incentive
Plan (the “Plan”) and this Agreement. 
RSUs are bookkeeping units, and do not represent ownership of Shares or
any other equity security.  The Company
shall maintain a bookkeeping account on behalf of Participant (the “Account”)
reflecting the number of RSUs then credited to Participant hereunder as a
result of this grant of RSUs and any crediting of additional RSUs to
Participant pursuant to payments of Dividend Equivalents under Section 5.  For purposes of this Agreement, the term RSUs
includes RSUs as to which the risk of forfeiture under Section 2 has lapsed.

 

2.             Vesting and Forfeiture

 

(a)           RSUs granted hereunder shall vest
(meaning that the risk of forfeiture of such RSUs under this Section 2 shall
lapse; such RSUs shall remain subject to Section 6) at the scheduled lapse date
set forth on the cover page of this Agreement, except that all RSUs shall vest
on an accelerated basis upon the earliest of (i) Termination of Employment (as
defined below) by reason of a Retirement, but only if the Committee has
specifically approved the accelerated vesting of the RSUs upon such Retirement,
(ii) Termination of Employment by reason of death or Disability, (iii) upon the
occurrence of a Change in Control if so provided in Participant’s Employment
Agreement or otherwise if the Committee has determined, in its discretion, that
such acceleration shall occur, or (iv), except to the extent limited by the
provisions set forth on the cover page of this Agreement, any other event
specified as resulting in acceleration of RSUs in the Employment Agreement (as
then in effect) or any other agreement between the Company and Participant in
effect at the time of Termination of Employment.  Each RSU credited as a result of Dividend
Equivalents on a forfeitable RSU and any cash amount payable as Dividend
Equivalents on a forfeitable RSU under Section 5(a) shall vest at the time of
vesting of the forfeitable RSU which gives rise, directly or indirectly, to the
crediting of such Dividend Equivalent RSU or cash.  Each RSU credited as a result of Dividend
Equivalents on a then non-forfeitable RSU under Section 5(a) shall be fully
vested and non-forfeitable from and after the date of such crediting, and any
cash amount credited as Dividend Equivalents on a then on-forfeitable RSU shall
be deemed to be fully vested and non-forfeitable at the time it is credited and
shall be paid at the time of settlement.

 

(b)           In the event of Participant’s
Termination of Employment, all RSUs that are not vested at or prior to the time
of such Termination shall be forfeited, unless otherwise determined by the
Committee.  Thus, upon Participant’s
voluntary Termination of Employment or a Termination of Employment by the
Company for Cause, unvested RSUs generally will be forfeited.

 

(c)           For purposes of this Agreement, a
Termination of Employment shall mean a termination of Participant’s employment
with the Company or a subsidiary or affiliate of the Company if, immediately
thereafter, Participant is not employed by any of the Company or its
subsidiaries or affiliates.

 

(d)           For purposes of this Agreement, Cause
shall have the meaning defined

 

2

 

in the Employment Agreement or any successor employment agreement
between the Company (or a subsidiary or affiliate) and Participant in effect at
the time of Termination of Employment or, if there is no such employment
agreement, Cause shall mean  (1) willful
malfeasance or willful misconduct by Participant in connection with his or her
employment, (2) continuing failure to perform such duties as are requested by
any employee to whom Participant reports, directly or indirectly, or by the
board of directors of either the Company or the subsidiary or affiliate that
employs Participant, (3) failure by Participant to observe policies of the
Company or his or her employer applicable to Participant, or (4) the commission
by Participant of (i) any felony or (ii) any misdemeanor involving moral
turpitude.

 

3.             Nontransferability

 

Until the time
each RSU becomes vested in accordance with Section 4 below, such RSU shall not
be transferable or assignable other than by will or by the laws of descent and
distribution or to a designated Beneficiary in the event of Participant’s
death, and no such transfer shall be effective to bind the Company unless the
Committee shall have been furnished with a copy of such will, Beneficiary
designation, or such other evidence as the Committee may deem necessary to
establish the validity of the transfer.

 

4.             Settlement

 

RSUs granted
hereunder, together with RSUs credited as a result of Dividend Equivalents,
shall be settled by delivery of one Share for each RSU being settled.  Settlement of an RSU granted hereunder shall
occur upon the lapse of the risk of forfeiture of such RSU under Section
2.  Settlement of RSUs that directly or
indirectly result from Dividend Equivalents on RSUs granted hereunder shall
occur at the time of settlement of the granted RSU.

 

5.             Dividend Equivalents and
Adjustments

 

(a)           Dividend Equivalents shall be paid or
credited on RSUs (other than RSUs that, at the relevant record date, previously
have been settled or forfeited) as follows:

 

(i)                                     Cash Dividends. 
If the Company declares and pays a dividend or distribution on Common
Stock in the form of cash and the record date for such cash dividend is prior
to the settlement of the associated RSU, then a Participant shall be entitled
to Dividend Equivalents calculated at the time of such settlement and credited
and paid in cash at settlement, without interest.

 

(ii)                                  Non-Share Dividends. 
If the Company declares and pays a dividend or distribution on Common
Stock in the form of property other than Shares, then a number of additional
RSUs shall be credited to Participant’s Account as of the payment date for such
dividend or distribution equal to the number of RSUs credited to the Account as
of the record date for such dividend or distribution multiplied by the Fair
Market Value of such property actually paid as a dividend or distribution on
each outstanding Share at such payment date, divided by the Fair Market Value
of a Share at such payment date.

 

(iii)                               Common Stock Dividends and Splits. 
If the Company declares and pays a dividend or distribution on Common
Stock in the form of additional Shares, or there occurs a forward split of
Common Stock, then a number of additional RSUs shall be credited to Participant’s
Account as of the payment date for such dividend or distribution or forward
split equal to the number of RSUs

 

3

 

credited to the Account as of the record date for such
dividend or distribution or split multiplied by the number of additional Shares
actually paid as a dividend or distribution or issued in such split in respect
of each outstanding Share.

 

(b)           The number of RSUs credited to
Participant’s Account shall be appropriately adjusted, in order to prevent
dilution or enlargement of Participant’s rights with respect to RSUs, to
reflect any changes in the outstanding Shares resulting from any event referred
to in Section 10(a) of the Plan, taking into account any RSUs credited to
Participant in connection with such event under Section 5(a) hereof.

 

6.             Forfeiture of RSUs and Shares
Acquired Upon Prior Vesting and Settlement

 

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

 

If Participant directly or indirectly
engages in any of the “Detrimental Activities” defined below:

 

(a)                                  any unvested RSUs shall automatically be
forfeited on the later of the date of Participant’s Termination of Employment
or the date IMS HEALTH becomes aware of Participant’s Detrimental Activity,
without regard to the provisions of Section 2; and

 

(b)                                 Participant shall forfeit to the Company
any RSUs that vested and the resulting Shares acquired upon settlement during
the one year prior to, or at any time after, the date of the earliest actual
occurrence of Participant’s Detrimental Activity (the “Forfeiture Period”).  These Shares shall be forfeited by Participant
and are payable to the Company at the later of the date of Participant’s
Termination of Employment or the date IMS HEALTH becomes aware of Participant’s
Detrimental Activity.  If Participant has
disposed of such Shares during the Forfeiture Period, Participant’s obligation
to repay Shares upon such forfeiture will continue (payment of cash or other
property is not permitted), so that Participant will be required to acquire
replacement Shares and deliver them to the Company in settlement of Participant’s
forfeiture obligation without regard to any subsequent market price increase or
decrease from the date of exercise.  If
Participant fails to promptly deliver forfeited Shares and if, apart from this
Agreement, the Company is obligated to pay any cash amount to Participant, the
Company, as a setoff, may use such cash to purchase Shares in the open market
on Participant’s behalf, which Shares will be retained by the Company in
settlement of Participant’s forfeiture obligation hereunder.

 

Detrimental
Activities 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 Participant is using or disclosing it in the course of Participant’s job with such IMS HEALTH Company;

•                  during the period beginning the Date of Grant and ending twelve months
after Participant leaves his or her 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

4

period that
Participant worked for any IMS HEALTH Company;

•                  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
Participant worked for an IMS HEALTH Company; or

•                  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 Participant’s 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 the world in relation to the pharmaceutical and healthcare
industries (it being understood that the global market in which any of the
businesses of IMS is conducted and to which their goodwill extends is not
limited to any particular region in the world and that given the informational
nature of such businesses, they may be engaged effectively 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;

•                  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;

•                  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;

•                  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;

•                  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;

•                  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;

•                  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

•                  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

 

5

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.

 

7.             National
Insurance Contributions

 

You acknowledge that you have previously entered into a Joint Election
to assume full liability for the employer’s secondary Class 1 National
Insurance Contributions that will or may arise on the sale, assignment, release
or cancellation of your RSUs, pursuant to section 4(4)(a) of the Social
Security Contributions and Benefits Act 1992.

 

8.             Other Terms Relating to RSUs

 

(a)           The number of RSUs credited to a
Participant’s Account shall include fractional RSUs calculated to at least
three decimal places, unless otherwise determined by the Committee.  Upon settlement of RSUs, Participant shall be
paid, in cash, an amount equal to the value of any fractional share that would
have otherwise been deliverable in settlement of such RSUs, unless the Company
arranges to deliver shares to an account of Participant to which fractional
shares may be credited without requiring the Company to in fact issue a
fractional share.

 

(b)           It shall be a condition to the
obligation of the Company to issue and deliver Shares in settlement of the RSUs
that Participant (or any Beneficiary) pay to the Company (or a subsidiary or
affiliate), upon its demand, such amount as may be requested by the Company for
the purpose of satisfying the minimum statutory withholding liabilities for
federal, state, or local income or other taxes. 
If the amount requested is not paid, the Company may refuse to deliver
the Shares in settlement of the RSUs until such amount is paid.  Unless otherwise determined by the Committee
or unless Participant (or a Beneficiary) has prior to the settlement date made
alternative arrangements satisfactory to the Company to pay withholding taxes
applicable upon settlement, the Company shall withhold from the Shares to be
delivered in settlement of the RSUs that number of Shares having a fair market
value equal to the amount of such tax liability (or as nearly equal as possible
without exceeding the amount of such tax liability).  For this purpose, the fair market value of
the withheld Shares shall be the average high/low sales prices in composite
trading of New York Stock Exchange Listed securities on the day on which the
Shares are withheld.

 

(c)           An individual statement of
Participant’s Account will be issued to Participant not less frequently than
annually.  Such statements shall reflect
the amount of RSUs credited to Participant’s Account, transactions therein
during the period covered by the statement, and other information deemed
relevant by the Vice President of Global Human Resources.  Such a statement may be combined with or
include information regarding other plans and compensatory arrangements
relating to Participant.  A Participant’s
statements shall be deemed a part of this Agreement, and shall evidence the
Company’s obligations in respect of RSUs, including the number of RSUs credited
as a result of Dividend Equivalents (if any); provided, however, that any
statement containing an error shall not represent a binding obligation to the
extent of such error.

 

9.             Miscellaneous

 

(a)           This Agreement shall be legally
binding when executed by the Company and accepted by Participant as described
below, provided that no election of Participant will be binding unless
Participant has executed the Agreement and returned it to the Executive
Compensation & Equity Plans Department of the Company.

 

6

 

(b)           This Agreement shall be binding upon
the heirs, executors, administrators and successors of the parties.  This Agreement constitutes the entire
agreement between the parties with respect to the RSUs, and supersedes any
prior agreements or documents with respect to the RSUs.  No amendment, alteration, suspension,
discontinuation or termination of this Agreement which may impose any
additional obligation upon the Company or impair the rights of Participant with
respect to the RSUs shall be valid unless in each instance such amendment,
alteration, suspension, discontinuation or termination is expressed in a
written instrument duly executed in the name and on behalf of the Company and
by Participant.

 

(c)           Any Beneficiary designation made by
Participant in accordance with this provision may be changed from time to time,
without the consent of any previously designated Beneficiary (but subject to
any spousal consent as may be required) by filing with the Executive
Compensation & Equity Plans Department a notice of such change.   The change of Beneficiary designation shall
become effective upon receipt by the Executive Compensation & Equity Plans
Department.  In the event Participant’s
Beneficiary would otherwise become entitled to a distribution hereunder, and
all Beneficiaries designated by Participant are not then living, or if no valid
Beneficiary designation is in effect, Participant’s estate or duly authorized
personal representative shall be deemed to have been designated by Participant.

 

(d)           Any provision for distribution in
settlement of Participant’s Account hereunder shall be by means of bookkeeping
entries on the books of the Company and shall not create in Participant or any
Beneficiary any right to, or claim against any, specific assets of the Company,
nor result in the creation of any trust or escrow account for Participant or
any Beneficiary.  Participant or any
Beneficiary entitled to any distribution hereunder shall be a general creditor
of the Company.

 

(e)           Participant agrees and acknowledges
that the Plan is discretionary in nature and the Company may amend, cancel or
terminate the Plan at any time.  The
grant of RSUs is a one-time benefit solely offered to employees and does not
create any contractual or other right to receive a grant of RSUs or benefits in
lieu of RSUs in the future.  Future
grants, if any, will be at the sole discretion of the Company, including, but
not limited to, the timing of any grant, the number of RSUs and vesting
provisions.

 

(f)            Participant agrees and acknowledges
that his or her participation in the Plan and his or her execution of this
Agreement is voluntary.  The value of
equity incentive awards generally and Participant’s RSUs specifically is an
extraordinary item of compensation outside the scope of Participant’s
employment contract, if any, and does not constitute compensation of any kind
for services of any kind rendered to the Company (or any of its subsidiaries or
affiliates).  As such, neither equity
incentive awards generally nor Participant’s RSUs specifically are part of
normal or expected compensation for purposes of calculating any termination,
severance, resignation, redundancy, end of service payments, bonuses, long
service awards, pension or retirement benefits, or similar payments.

 

(g)           Participant acknowledges and agrees
that he or she will have no claim or entitlement (1) to compensation or damages
in consequence of the Termination of Employment with the Company (or any of its
subsidiaries or affiliates) for any reason whatsoever and whether or not in
breach of contract, insofar as such claim or entitlement arises or may arise
from Participant ceasing to have any rights under the Plan or this Agreement,
(2) to vest in his or her RSUs as a result of such Termination of Employment
except as expressly provided in this Agreement, or (3) from the loss or diminution
in value of his or her RSUs; and, upon the grant of Participant’s RSUs and in
partial consideration for his or her participation in the Plan and this
Agreement, Participant shall be deemed

 

7

 

irrevocably to
have waived any such claim or entitlement.

 

(h)           Participant voluntarily acknowledges
and consents to the collection, use, processing and transfer of personal data
as described in this paragraph. 
Participant is not obliged to consent to such collection, use,
processing and transfer of personal data. 
However, failure to provide the consent may affect Participant’s ability
to participate in the Plan.  The Company,
its subsidiaries and its affiliates hold certain personal information about
Participant, including Participant’s name, home address and telephone number,
date of birth, social insurance number or other employee identification number,
salary, nationality, job title, any shares of stock or directorships held in
the Company, details of Participant’s RSUs, all other equity incentive awards
or any other rights or entitlements to Shares in your favor, for the purpose of
managing and administering the Plan (“Data”). 
The Company, its subsidiaries and/or its affiliates will transfer Data
amongst themselves as necessary for the purpose of implementation,
administration and management of Participant’s participation in the Plan, and
the Company, its subsidiaries and/or its affiliates may each further transfer
Data to any third parties assisting the Company in the implementation,
administration and management of the Plan. 
These recipients may be located in the European Economic Area, or
elsewhere throughout the world, such as the United States.  Participant authorizes them to receive,
possess, use, retain and transfer the Data, in electronic or other form, for
the purposes of implementing, administering and managing his or her
participation in the Plan, including any requisite transfer of such Data as may
be required for the administration of the Plan and/or the subsequent holding of
Shares on Participant’s behalf to a broker or other third party with whom
Participant may elect to deposit any Shares acquired pursuant to the Plan.  Participant may, at any time, review Data,
require any necessary amendments to it or withdraw the consents herein in
writing by contacting the Company; however, withdrawing his or her consent may
affect Participant’s ability to participate in the Plan.  Participant acknowledges and agrees that his
or her consent shall apply to any and all restricted stock unit awards made to
him or her under the Plan or this Agreement, whether now or in the future.

 

(i)            Capitalized terms used in this
Agreement but not defined herein shall have the same meanings as in the
Plan.  If there is any conflict between
the provisions of this Agreement and the provisions of the Plan, the provisions
of the Plan shall govern, except as otherwise specifically provided herein.

 

*  *  *  *  *

                                Please
return a signed copy of this Agreement to the Company at the address below,
marking your envelope to the attention of Kristin Johnson, no later than
February 21, 2006.

 

IMS Health

Executive Compensation
& Equity Plans

660 W. Germantown Pike

Plymouth Meeting,
Pennsylvania 19462

U.S.A.

 

 

[For HR Use Only:
Date Received by Executive Compensation & Equity Plans Department:

                                 

 

8

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