Document:

Execution Copy

Exhibit 10.55.2

Employment
Agreement for Gilles Pajot

As Amended and Restated Effective May 7,
2006

IMS HEALTH
INCORPORATED

Employment
Agreement for Gilles Pajot

As Amended and
Restated Effective May 7, 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

  	
  3

  
	
  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

  	
  6

  
	
   

  	
  (d)

  	
  Deferral of Compensation

  	
  6

  
	
   

  	
  (e)

  	
  Company Registration Obligations

  	
  6

  
	
   

  	
  (f)

  	
  Reimbursement of Expenses

  	
  7

  
	
   

  	
  (g)

  	
  Relocation Following Termination of Employment

  	
  7

  
	
   

  	
  (h)

  	
  Limitations Under Code Section 409A

  	
  7

  
	
  6.

  	
  Termination Due to Retirement, Death or Disability

  	
  7

  
	
   

  	
  (a)

  	
  Retirement

  	
  7

  
	
   

  	
  (b)

  	
  Death

  	
  8

  
	
   

  	
  (c)

  	
  Disability

  	
  8

  
	
   

  	
  (d)

  	
  Other Terms of Payment Following Retirement, Death or
  Disability

  	
  9

  
	
  7. 

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

  	
  10

  
	
   

  	
  (a)

  	
  Termination by the Company for Cause

  	
  10

  

 

 i
 

 

	
   

  	
  (b) 

  	
  Termination by Executive Other Than For Good Reason 

  	
  10 

  
	
   

  	
  (c)

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

  	
  10

  
	
   

  	
  (d)

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

  	
  12

  
	
   

  	
  (e)

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

  	
  14

  
	
   

  	
  (f)

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

  	
  15

  
	
   

  	
  (g)

  	
  Other Terms Relating to Certain Terminations of
  Employment; Delayed Payments Under Section 409A

  	
  17

  
	
  8.

  	
  Definitions Relating to Termination Events

  	
  17

  
	
   

  	
  (a)

  	
  “Cause”

  	
  17

  
	
   

  	
  (b)

  	
  “Change in Control”

  	
  18

  
	
   

  	
  (c)

  	
  “Compensation Accrued at Termination”

  	
  19

  
	
   

  	
  (d)

  	
  “Disability”

  	
  19

  
	
   

  	
  (e)

  	
  “Good Reason

  	
  19

  
	
   

  	
  (f)

  	
  “Potential Change in Control”

  	
  20

  
	
   

  	
  (g)

  	
  “Specified Employee”

  	
  20

  
	
  9. 

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

  	
  21

  
	
   

  	
  (a)

  	
  Rabbi Trust Funded Upon Potential Change in Control

  	
  21

  
	
   

  	
  (b)

  	
  Gross-up If Excise Tax Would Apply

  	
  21

  
	
  10. 

  	
  Non-Competition and Non-Disclosure; Executive
  Cooperation;

  Non-Disparagement

  	
  22

  
	
   

  	
  (a)

  	
  Non-Competition

  	
  22

  
	
   

  	
  (b)

  	
  Non-Disclosure; Ownership of Work

  	
  23

  
	
   

  	
  (c)

  	
  Cooperation With Regard to Litigation

  	
  23

  
	
   

  	
  (d)

  	
  Non-Disparagement

  	
  23

  
	
   

  	
  (e)

  	
  Release of Employment Claims

  	
  23

  
	
   

  	
  (f)

  	
  Forfeiture of Outstanding Options

  	
  23

  
	
   

  	
  (g)

  	
  Survival

  	
  24

  
	
  11.

  	
  Governing Law; Disputes; Arbitration

  	
  24

  
	
   

  	
  (a)

  	
  Governing Law

  	
  24

  
	
   

  	
  (b)

  	
  Reimbursement of Expenses in Enforcing Rights

  	
  24

  
	
   

  	
  (c)

  	
  Arbitration

  	
  25

  

 

 ii
 

 

	
  

  	
  (d)

  	
  Interest on Unpaid Amounts

  	
  25

  
	
  12.

  	
  Miscellaneous

  	
  25

  
	
   

  	
  (a)

  	
  Integration

  	
  25

  
	
   

  	
  (b)

  	
  Successors; Transferability

  	
  25

  
	
   

  	
  (c)

  	
  Beneficiaries

  	
  26

  
	
   

  	
  (d)

  	
  Notices

  	
  26

  
	
   

  	
  (e)

  	
  Reformation

  	
  26

  
	
   

  	
  (f)

  	
  Headings

  	
  26

  
	
   

  	
  (g)

  	
  No General Waivers

  	
  26

  
	
   

  	
  (h)

  	
  No Obligation To Mitigate

  	
  26

  
	
   

  	
  (i)

  	
  Offsets; Withholding

  	
  27

  
	
   

  	
  (j)

  	
  Successors and Assigns

  	
  27

  
	
   

  	
  (k)

  	
  Counterparts

  	
  27

  
	
  13.

  	
  Indemnification

  	
  27

  
	
  Addendum A

  	
  28

  

 

 iii

IMS HEALTH
INCORPORATED

Employment
Agreement for Gilles Pajot

As Amended and Restated Effective May 7, 2006

THIS
EMPLOYMENT AGREEMENT by and between IMS HEALTH INCORPORATED, a Delaware
corporation (the “Company,” subject to Section 12(b)), and Gilles Pajot (“Executive”)
became 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 and the second amendment and restatement of this Employment
Agreement became effective as of May 7, 2006 (the “Restatement Date”).

WITNESSETH

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 February 16, 2006, as President, Global Business
Management, for the Company;

WHEREAS, Executive
desires to continue his employment on the terms and conditions herein set
forth;

WHEREAS, Executive
became a U.S. resident for Federal income tax purposes on the Restatement Date
thereby causing this Employment Agreement to become subject to Section 409A of
the Internal Revenue Code of 1986, as amended (the “Code”);

WHEREAS, Executive
and the Company desire to amend and restate this Employment Agreement to comply
with Section 409A of the Code effective as of the Restatement Date and to make
certain other changes to this Employment Agreement as set forth herein.

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 February 16, 2006, 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)

 1
 

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.

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 County,
Connecticut.

(c)                                  Administrative
Assistance.  Executive will be
provided with a senior level executive assistant at the Corporate Offices of
the Company in Fairfield County, 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. The Company will pay to Executive during the Term a base salary,
the annual rate of which shall be 364,140 British Pounds Sterling until October
16, 2006 and from and after such date $700,269, 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

 2
 

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 the greater of: (i) 71% of
Base Salary; and (ii) 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 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 applicable plan (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
Effective 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
Effective 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 for 2006); 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.

(b)                                 Employee
and Executive Benefit Plans.  Except
as otherwise provided in this Section 5(b), 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

 3
 

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 Effective Date
substantially no less favorable than those provided by the Company to Executive
under such plans and programs as in effect on the Effective Date.  The foregoing notwithstanding, Executive
shall not be eligible to participate or receive benefits under the Company’s
Retirement Plan, Savings Plan or 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.  Moreover, the
Company may, at its discretion, designate the welfare and fringe benefit plans
in which Executive shall be eligible to participate after the Restatement Date
provided that the welfare and fringe benefits provided by the Company to
Executive after the Restatement Date are no less favorable than those provided
by the Company to Executive before the Effective Date.

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

(i)                                     Executive
will participate as Executive Vice President and President, Global Business
Management, in all executive and employee vacation and time-off programs.  Until the third anniversary of the
Restatement Date, he shall be provided with first class round-trip airfare to
Paris once every 12 months in order to maintain family ties and, in the event
of a serious illness or death of a member of Executive’s immediate family, the
Company will provide Executive with an additional first class round-trip
airfare to Paris, to be provided in kind or reimbursed to Executive in the
payroll period next following the period in which such expense is incurred by
Executive;

(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
Effective 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 Effective 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 in Addendum A hereto; provided, however, that, in the event of
termination of Executive’s employment by the Company for Cause pursuant to
Section 7(a), no benefits will be payable to Executive pursuant to this Section
5(b)(iv);

(v)                                 The
Company will provide Executive with medical, dental and prescription drug
benefits consistent with its policies for other senior executives, but coverage
shall be provided through the Company’s insured international medical and
dental plan or such replacement coverage as Executive may agree to from time to
time;

(vi)                              The
Company will provide Executive with the benefits under the Executive Rewards
Program, as in effect during the Term, which currently provide an annual
physical and up to $10,000 in professional financial planning services.  In addition, until the third anniversary of
the Restatement Date, the Company will provide Executive with professional
financial planning services associated with his relocation to the United
States.  Such services shall be provided
in kind or reimbursed to Executive in the year in which such financial planning
services are incurred; and

(vii)                           Until
the third anniversary of the Restatement Date, the Company will provide
Executive with the following expatriate benefits:

·                  An
automobile allowance, car service or company car to facilitate daily travel to
and from Company offices and business activities (“commuting”) to be provided
in kind or reimbursed to Executive on a monthly basis.  The Company will reimburse Executive for
income taxes resulting from commuting and from the reimbursement of taxes
therefore under this Section 5(b)(vii), but the reimbursement for taxes under
this

 4
 

Section 5(b)(vii)
will not apply to other income taxes resulting from permitted personal use of
the automobile and driver or car service. 
Such reimbursement shall be made in a lump sum in the year in which such
taxes are due.

·                  Temporary
living expenses from the time Executive vacated his apartment in the United
Kingdom until June 2, 2006 and a monthly allowance of $18,200, net after taxes,
beginning June 2, 2006 for Executive’s costs for housing, security, furniture
rental, cleaning services and utilities provided in kind or reimbursed to
Executive on a monthly basis. The Company will also bear any lease costs
relating to Executive’s United Kingdom apartment after the Restatement Date
through its expiration in July 2006, which costs will be payable in 2006. To
cover incremental miscellaneous expenses incurred in connection with Executive’s
relocation to the United States, the Company will pay to Executive in 2006 a
disturbance allowance equal to one-month’s base salary, net after taxes, in
2006.  The Company will also pay for or
reimburse to Executive his reasonable moving expenses by way of surface
shipment of up to one 40-foot container load and an air shipment of up to 1,000
pounds net weight associated with his relocation to the United States of normal
household goods and personal effects, payable in 2006. The Company will further
pay for or reimburse to Executive reasonable storage fees in the United Kingdom
for other normal household goods and personal effects, which fees will be
payable on a monthly basis.  Reasonable
moving and storage expenses subject to reimbursement hereunder will not include
the moving or storage of automobiles, boats, valuable collections or other
items that the Company, in its discretion, determines do not constitute normal
household goods or personal effects. Although the Company will not reimburse
Executive for shipping any automobile or other vehicle to or from the United
States, the Company will pay to Executive in 2006 the amount of $3,000, net
after taxes, for loss incurred upon sale or early lease cancellation fee with
respect to an automobile. The Company will further provide Executive with
certain destination services, including security and porter services, payable
monthly in advance or provided in-kind on a monthly basis, consistent with
those provided to Executive immediately prior to the Restatement Date, and will
pay for or reimburse to Executive in 2006 all costs incurred in securing visas,
passports, work permits and related documents.

·                  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) and payment pursuant to
such policy to be made in a lump sum in the year in which such taxes are due.  All calculations of tax equalization payments
will be performed by and shall be subject to the final approval of the Company’s
designated tax preparer, which shall be an international tax firm, whose
determination of Executive’s tax equalization payments will be binding upon the
Company and Executive.  The Company will
pay all fees charged by the designated tax preparer for calculation of the tax
equalization payments as provided for herein and for the preparation of all
required tax returns for Executive, which costs shall be paid in a lump sum in
the year in which such services are billed to the Company.

(viii) Executive
will be paid an amount equal to the aggregate Company matching contributions
that would have been credited to Executive’s account under the Company Savings
Plan and the Company Savings Equalization Plan had Executive participated in
such plans to the maximum extent permissible under such plans from the
Restatement Date until Executive’s

 5
 

termination of
employment plus earnings at an annual rate equal to the annual return that
would have been earned had such matching contributions been credited to an
account for Executive on January 1st of each year and invested 80 percent in
the fixed income fund and 20 percent in the equity index fund available under
the Company Savings Plan, such amount to be paid in a lump sum in the calendar
year next following the calendar year in which Executive’s termination of
employment occurs or in the payroll period next following the payroll period in
which Executive’s death occurs, if earlier.

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 that is provided pursuant to Section
5(b)(v) above 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; 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) for such
coverage, unless otherwise provided under Section 6 or 7, in which case there
shall be no cost for such coverage for the period specified in Section 6 or 7,
as the case may be (subject to the requirements specified in such Section 6 or
7), or unless Executive shall be eligible for
substantially similar coverage under the Company’s retiree health plan, in
which case coverage shall be provided at the cost and in accordance with the
terms of the Company’s retiree health plan provided such cost is not more than
the then-current annual COBRA premium being paid (or payable) for continuation
of the Company’s health and medical coverage that is provided pursuant to
Section 5(b)(v) above. 
If the terms of the Company’s plans do not allow
Executive’s continued participation, Executive shall instead be paid cash
payments until Executive becomes eligible for similar
coverage with a subsequent employer or other entity to which Executive provides
services or becomes eligible for Medicare equivalent on an
after-tax basis to the value of the retiree health benefits that Executive
would have received under the Company’s health plan had Executive qualified for
full retiree health benefits under the Company’s health plan, with such
payments to be made by the Company to Executive on a monthly basis (it being
understood that the Company payments to Executive attributable to these retiree
health benefits will be equal on an after-tax basis to the monthly premium cost
to Executive to purchase such benefits separately, which shall not exceed the
highest risk premium charged by a carrier having an investment grade or better
credit rating).

(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.

 6
 

(f)                                    Reimbursement
of Expenses.  The Company will
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, any such reimbursement to be made in a lump sum in the year in which
Executive submits to the Company a receipt for any such expense or
disbursement.

(g)                                 Relocation
Following Termination of Employment. 
On or before December 31st of the second calendar year following the
calendar year in which Executive’s employment terminates 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
reimburse Executive for all reasonable and customary expenses actually incurred
by 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.   Notwithstanding the foregoing, any tax
gross-up payable with respect to any such relocation reimbursement shall be
paid to Executive in a lump sum in the year in which the taxes are due.

(h)                                 Limitations Under Code Section 409A.  Anything in this Section 5 to the contrary
notwithstanding, with respect to any payment otherwise required hereunder, in
the event of any delay in the payment date as a result of Section 7(g) of this
Agreement (relating to the six-month delay in payment of certain benefits to
Specified Employees as required by Section 409A of the Code), the Company will
adjust the payment to reflect the deferred payment date by multiplying the
payment by the product of the six-month CMT Treasury Bill annualized yield rate
as published by the U.S. Treasury for the date on which such payment would have
been made but for the delay multiplied by a fraction, the numerator of which is
the number of days by which such payment was delayed and the denominator of
which is 365. The Company will pay the adjusted payment at the beginning of the
seventh month following Executive’s termination of employment.  Notwithstanding the foregoing, if calculation
of the amounts payable by such payment date is not administratively practicable
due to events beyond the control of Executive (or Executive’s beneficiary or
estate) and for reasons that are commercially reasonable, payment will be made
as soon as administratively practicable in compliance with Section 409A of the
Code and the proposed and final Treasury Regulations thereunder, as the same
may be amended from time to time (the “Regulations”). In the event of Executive’s
death during such six-month period, payment will be made in the payroll period
next following the payroll period in which Executive’s death occurs.

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 at the time specified in
Section 6(d), 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, a lump sum 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 and paid at the time specified in
the applicable plan), multiplied by

 7
 

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 (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.

(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, in
the absence of a beneficiary designation by Executive, his estate, at the time
specified in Section 6(d), 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, a lump sum 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 and paid at the time specified in
the applicable plan), 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)                               Stock
options held by Executive at death 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.  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 at the time specified in Section
6(d), 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, a lump sum 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 and paid at the time specified in
the applicable plan), 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;

 8
 

(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;

(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 (or the date Medicare coverage becomes available
to Executive, if later) 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, disability 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 cash payments
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 (or the date Medicare
coverage becomes available to Executive, if later), with such payments to be
made by the Company to Executive on a monthly basis (it being understood that
the Company payments to Executive attributable to these benefits will be equal
on an after-tax basis to the monthly premium cost to Executive to purchase such
benefits separately, 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 as specified in this Section 6, will be paid in the payroll
period next following the payroll period in which Executive’s termination of
employment occurs; subject, however, to the provisions of Section 7(g) of this
Agreement (relating to the six-month delay in payment of certain benefits to
Specified Employees as required by Section 409A of the Code). Any payment due
within such six-month period shall be delayed to the end of such six-month
period as required by Section 7(g). The Company will adjust the payment to
reflect the deferred payment date by multiplying the payment by the product of
the six-month CMT Treasury Bill annualized yield rate as published by the U.S.
Treasury for the date on which such payment would have been made but for the
delay multiplied by a fraction, the numerator of which is the number of days by
which such payment was delayed and the denominator of which is 365. The Company
will pay the adjusted payment at the beginning of the seventh month following
Executive’s termination of employment. 
Notwithstanding the foregoing, if calculation of the amounts payable by
such payment

 9
 

date is not
administratively practicable due to events beyond the control of Executive (or
Executive’s beneficiary or estate) and for reasons that are commercially
reasonable, payment will be made as soon as administratively practicable in
compliance with Section 409A of the Code and the Regulations. In the event of
Executive’s death during such six-month period, payment will be made in the
payroll period next following the payroll period in which Executive’s death
occurs.

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 at the time specified in Section 7(g), 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)) 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 at the time specified in Section 7(g), 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

 10
 

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 at
the time specified in Section 7(g), 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 paid in a lump sum;

(iii)                               In
lieu of any annual incentive compensation under Section 4(b) for the year in
which Executive’s employment terminated, a lump sum 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; 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 or
the date Medicare coverage becomes available to Executive, if later), 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, disability 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

 11
 

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 cash payments 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 payments to be made by the Company to
Executive on a monthly basis (it being understood that the Company payments to
Executive attributable to these benefits will be equal on an after-tax basis to
the monthly premium cost to Executive to purchase such benefits separately, 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
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(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 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 at the time specified in
Section 7(g), 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 paid in a lump sum;

(iii)                               In lieu of
any annual incentive compensation under Section 4(b) for the year in which
Executive’s employment terminated, a lump sum 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

 12
 

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;

(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 or the date Medicare coverage becomes available to Executive, if later),
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, disability 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 instead be paid cash
payments 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 payments to be made by the Company to Executive on a monthly
basis (it being understood that the Company payments to Executive attributable
to these benefits will be equal on an after-tax basis to the monthly premium
cost to Executive to purchase such benefits separately, 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.

 13
 

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 at the time
specified in Section 7(g), 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(e)(ii) shall be paid in a
lump sum;

(iii)                               In
lieu of any annual incentive compensation under Section 4(b) for the year in
which Executive’s employment terminated, a lump sum 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,

 14
 

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 or the date Medicare coverage becomes available to Executive, if later),
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, disability 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(e)(viii) do not allow
Executive’s continued participation, Executive shall be paid cash payments
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 payments to be made by the Company to Executive on a monthly basis
(it being understood that the Company payments to Executive attributable to
these benefits will be equal on an after-tax basis to the monthly premium cost
to Executive to purchase such benefits separately, 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 at the time specified in Section 7(g), 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

 15
 

(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 in a lump
sum;

(iii)                               In
lieu of any annual incentive compensation under Section 4(b) for the year in
which Executive’s employment terminated, a lump sum 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) 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 or the date Medicare coverage becomes available to Executive, if later),
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, disability 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 cash payments
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
payments to be made by the Company to

 16
 

Executive on a
monthly basis (it being understood that the Company payments to Executive
attributable to these benefits will be equal on an after-tax basis to the
monthly premium cost to Executive to purchase such benefits separately, 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; Delayed Payments Under
Section 409A.  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 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 as
specified in this Section 7, will be paid in the calendar year next following
the calendar year in which Executive’s termination of employment occurs or in
the payroll period next following the payroll period in which Executive’s death
occurs, if earlier, except as otherwise provided in this Section 7 or Section
8(c).  Anything in this Agreement to the
contrary notwithstanding, payments to be made under this Agreement upon
termination of Executive’s employment which are subject to Section 409A of the
Code shall not be paid until at least six months following such termination of
employment if Executive is a Specified Employee as defined in Section 8(g) on
the date of his termination of employment. 
Any payment due within such six-month period shall be delayed to the end
of such six-month period. The Company will adjust the payment to reflect the
deferred payment date by multiplying the payment by the product of the
six-month CMT Treasury Bill annualized yield rate as published by the U.S.
Treasury for the date on which such payment would have been made but for the
delay multiplied by a fraction, the numerator of which is the number of days by
which such payment was delayed and the denominator of which is 365. The Company
will pay the adjusted payment at the beginning of the seventh month following
Executive’s termination of employment. 
Notwithstanding the foregoing, if calculation of the amounts payable by
such payment date is not administratively practicable due to events beyond the
control of Executive (or Executive’s beneficiary or estate) and for reasons
that are commercially reasonable, payment will be made as soon as
administratively practicable in compliance with Section 409A of the Code and
the Regulations. In the event of Executive’s death during such six-month
period, payment will be made in the payroll period next following the payroll
period in which Executive’s death occurs.

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

 17
 

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
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

 18

(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 a lump sum at the time
specified in Section 6(d) or Section 7(g), as the case may be;

(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, payable in a lump sum at the time specified in
Section 6(d) or Section 7(g), as the case may be.

(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 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;

 19
 

(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;

(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.

(g)                     “Specified
Employee” For purposes of this Agreement, a “Specified Employee” shall mean
an employee of the Company who satisfies the requirements for being designated
a “key employee” under Section 416(i)(1)(A)(i), (ii) or (iii) of the Code
without regard to Section 416(i)(5) of the Code at any time during a calendar
year, in which case such employee shall be considered a Specified Employee for
the twelve-month period beginning on the first day of the fourth month
immediately following the end of such calendar year. Notwithstanding the
foregoing, all employees who are nonresident aliens during an entire calendar
year are excluded for purposes of determining which employees meet the
requirements of Section 416(i)(1)(A)(i), (ii) or (iii) of the Code without
regard to Section 416(i)(5) of the Code for such calendar year. The term “nonresident

 20
 

alien” as used
herein shall have the meaning set forth in Regulations Section
1.409A-1(j).  In the event of any
corporate spinoff or merger, the determination of which employees meet the
requirements of Section 416(i)(1)(A)(i), (ii) or (iii) of the Code without
regard to Section 416(i)(5) of the Code for any calendar year shall be
determined in accordance with Regulations Section 1.409A-1(i)(2).

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.

 21
 

(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 on 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
administratively practicable in compliance with Section 409A of the Code and
the Regulations thereunder but in no event later than the thirtieth day after
the date of Executive’s termination of employment subject, however, to any
delay in the payment date as a result of Section 7(g) of this Agreement
(relating to the six-month delay in payment of certain benefits to Specified
Employees as required by Section 409A of the Code).  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

 22
 

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 (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

 23
 

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 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.  Anything in this Agreement to the contrary
notwithstanding, the terms of this Agreement shall be interpreted and applied
in a manner consistent with the requirements of Section 409A of the Code and
the Regulations thereunder and the Company shall have no right to accelerate or
make any payment under this Agreement except to the extent permitted under
Section 409A of the Code.  The Company
shall have no obligation, however, to reimburse Executive for any tax penalty
or interest payable or provide a gross-up payment in connection with any tax
liability of Executive under Section 409A of the Code except that this
provision shall not apply in the event of the Company’s negligence or willful
disregard in interpreting the application of Section 409A of the Code to this
Agreement which negligence or willful disregard causes Executive to become
subject to a tax penalty or interest payable under Section 409A of the Code nor
shall this provision be interpreted to limit any gross-up payable to Executive
under Section 9(b) or any tax equalization payment under Section 5(b)(vi) of
this Agreement.

(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 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.  Any such
payment or reimbursement shall be made in a lump sum in the month next
following the month in which such costs and expenses are incurred subject to
Executive’s submission of receipts for such expenses.

 24
 

(c)                      Arbitration.  Any dispute or controversy arising under or
in connection with this Agreement shall be settled exclusively by arbitration
in Fairfield, 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 and shall pay such costs
and expenses in the tax year in which incurred. 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.

(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, except as otherwise provided in Sections 5(h) and 7(g) of this Agreement
(concerning interest payable with respect to delayed payments under Section
409A of the Code).

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

 25
 

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

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

 26
 

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.

13.                                 Indemnification.

All rights to
indemnification by the Company now existing in favor of 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 Executive provide an undertaking to repay such advances if it
is ultimately determined that Executive is not entitled to indemnification;
provided, however, that any determination required to be made with respect to
whether 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 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 Executive
to indemnification thereunder. Any provision contained herein notwithstanding,
this Agreement shall not limit or reduce any rights of 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

  

 

 27
 

Addendum A

Effective as of
the Restatement Date

I.                                         Definitions.  The terms used in this Addendum A shall have
the meanings provided in the Employment Agreement as of the Restatement Date
except as otherwise provided below:

“Actuarial
Equivalent” or “Actuarially Equivalent”, for purposes of determining the lump
sum value of Executive’s Supplemental Benefit, shall be computed on the basis
of the Applicable Mortality Table and by using an interest rate equal to 85% of
the average of the yields on 15-year non-callable U.S. Treasury bonds (or such
reasonable equivalent to such bonds as the Company may determine) as of the
close of business on the last business day of each of the three months
immediately preceding the date of determination.

“Annual Accrual
Rate” shall mean 3.25%.

“Applicable
Mortality Table” shall mean the mortality table described in Section
417(e)(3)(A)(ii)(I) of the Code.

“Average Final
Compensation” shall mean Executive’s average annual Eligible Compensation
during the last 60 consecutive months of service with the Company (or during
the total number of consecutive months, if fewer than 60), immediately prior to
Executive’s termination of employment with the Company, but in no event less
than 619,295 British Pounds Sterling.

“Beneficiary” shall
mean the beneficiary designated by Executive or, in the absence of a
beneficiary designation by Executive, his estate.

“Credited Service”
shall mean Executive’s completed years and months of service with the Company,
increased by five years, but in no event shall Executive’s Credited Service
under this Addendum A, including without limitation, Credited Service
determined in accordance with the provisions of Articles IV, VI and VII of this
Addendum A, exceed 20 years.  For any
partial month of service, Executive shall be credited with a full month of
service. Credited Service shall be expressed in years and months and shall be
measured in cumulative monthly increments, including holidays, vacations,
leaves of absence approved by the Company, weekends and other nonworking
days.  Credited Service shall begin with
the date of commencement of Executive’s employment with the Company and end on
Executive’s termination of employment date under the Employment Agreement.

“Eligible
Compensation” shall mean Executive’s annual base salary, regular annual bonuses
and deferrals under Company-sponsored plans.

“ERISA” shall mean
the Employee Retirement Income Security Act of 1974, as amended.

“P&U
Retirement Programs” shall mean all qualified and nonqualified retirement plans
maintained by Pharmacia & Upjohn Company and any predecessor or successor
thereto.

“Supplemental
Benefit” shall mean the benefit payable to Executive pursuant to Section
5(b)(iv) of the Employment Agreement as described in Article II of this
Addendum A.

“U.S. Executive
Retirement Plan” shall mean the Company-sponsored U.S. Executive Retirement
Plan as in effect on the date payment commences to be made to Executive in
accordance with Article IV of this Addendum A.

 28
 

II.                                     Supplemental
Benefit

Executive’s Supplemental
Benefit shall be equal to his Annual Accrual Rate multiplied by his Average
Final Compensation multiplied by his Credited Service, minus the benefits
payable or paid to Executive under the P&U Retirement Programs; subject,
however, to a minimum Supplemental Benefit payable in the event that Executive
continues employment with the Company until his attainment of age 60, which
minimum Supplemental Benefit shall be equal to 55% of Executive’s Average Final
Compensation, less any benefits payable or paid under the P&U Retirement
Programs.  Executive shall be fully
vested in his Supplemental Benefit; provided, however, that no Supplemental
Benefit or any other benefit shall be payable under this Addendum A in the
event of Executive’s termination for Cause under the terms of the Employment
Agreement.

III.                                 Time
of Payment of Supplemental Benefit

Payment
of the Actuarial Equivalent Value of Executive’s Supplemental Benefit shall be
made at the later of:  (a) the calendar
year next following the calendar year in which Executive’s termination of
employment with the Company occurs; and (b) July 5, 2009; provided, however,
that Executive may change the time of payment of all or a portion of Executive’s
Supplemental Benefit at any time or times on or before December 31, 2007 (or
such later date as may be specified by the Internal Revenue Service in
Regulations or other guidance interpreting Section 409A of the Code) provided
that any such change shall be made in writing on such form as the Company may
reasonably require in order to comply with such Regulations or other guidance.

Notwithstanding
the foregoing, if calculation of the Supplemental Benefit payable to Executive
by the payment date set forth in this Article III is not administratively
practicable due to events beyond the control of Executive (or Executive’s
beneficiary or estate) for reasons that are commercially reasonable, payment
will be made as soon as administratively practicable in compliance with Section
409A of the Code and the Regulations.

Anything in this
Addendum A to the contrary notwithstanding, any payment to be made under this
Addendum A upon termination of Executive’s employment which is subject to
Section 409A of the Code shall not be paid earlier than six months following
such termination of employment in accordance with Section 7(g) of the
Employment Agreement if Executive is a Specified Employee as defined in Section
8(g) of the Employment Agreement on the date of his termination of employment.
In the event of any delay in the payment date as a result of Section 7(g) of
the Employment Agreement, the Company will adjust the payment to reflect the
deferred payment date by multiplying the payment by the product of the
six-month CMT Treasury Bill annualized yield rate as published by the U.S. Treasury for the date on which such payment
would have been made but for the delay multiplied
by a fraction, the numerator of which is the number of days by which such
payment was delayed and the denominator of which is 365. The Company will pay
the adjusted payment at the beginning of the seventh month following Executive’s
termination of employment. 
Notwithstanding the foregoing, if calculation of the amounts payable by
such payment date is not administratively practicable due to events beyond the
control of Executive (or Executive’s beneficiary or estate) and for reasons
that are commercially reasonable, payment will be made as soon as
administratively practicable in compliance with Section 409A of the Code and
the Regulations. In the event of Executive’s death during such six-month
period, payment will be made in accordance with Section VI of this Addendum A
on the basis that Executive’s death occurred prior to payment of his
Supplemental Benefit.

IV.                                 Determination
of Supplemental Benefit Upon Disability

Executive’s
Supplemental Benefit payable upon termination of employment due to Disability
shall not be less than the pension benefit Executive would have received under
the U.S. Executive Retirement

 29
 

Plan
had Executive been a participant in the U.S. Executive Retirement Plan,
calculated on the basis of his Average Final Compensation determined as of his
date of termination of employment with the Company on account of Disability and
his Credited Service increased to include months and years of service from the
date of Executive’s termination of employment on account of Disability until
his attainment of age 65, reduced, however, by the benefits paid or payable
under the P&U Retirement Programs.

V.                                     Form
of Payment of Supplemental Benefit

Executive’s
Supplemental Benefit shall be paid in the form of an Actuarially Equivalent
lump sum; provided, however, that Executive may change the form of
payment of all or a portion of Executive’s Supplemental Benefit at any time or
times on or before December 31, 2007 (or such later date as may be specified by
the Internal Revenue Service in Regulations or other guidance interpreting
Section 409A of the Code) provided that any such change shall be made in
writing on such form as the Company may reasonably require in order to comply
with such Regulations or other guidance.

Executive and the
Company may also agree at any time in writing to amend this Addendum A to delay
the time and/or change the form of payment of Executive’s Supplemental Benefit,
provided, however, that (a) no such delay or change shall be
effective until twelve months after the date such amendment is executed by
Executive and the Company; (b) except in the event of payment upon death, such
amendment must be executed not fewer than twelve months prior to the date
payment of Executive’s Supplemental Benefit was otherwise scheduled to be made;
and (c) except in the event of payment upon death, the new distribution date or
form of payment may not be effective sooner than the fifth anniversary of the
date payment was otherwise scheduled to be made.

VI.                                 Death
Benefit

Upon the death of
Executive prior to the payment of his Supplemental Benefit, his Beneficiary
shall be entitled to receive a lump sum payment of the Supplemental Benefit
that was payable to Executive on the date of his death.  Payment to Executive’s Beneficiary shall be
made in the payroll period next following the payroll period in which Executive’s
death occurs.

In the event of
Executive’s death after payment of his Supplemental Benefit has been made, no
benefit shall be payable under this Article VI.

VII.                             Change
in Control

As provided in
Sections 7(e)(vii) and 7(f)(vii) of the Employment Agreement, in the event of
the termination of Executive’s employment by the Company without Cause within
two years after a Change in Control or in the event of Executive’s termination
of employment for Good Reason within two years after a Change in Control,
Executive shall be credited with an additional three years of age plus an
additional three years of Credited Service for purposes of calculating
Executive’s Supplemental Benefit under Article II of this Addendum A and
calculating any Actuarially Equivalent benefits payable under Article III of
this Addendum A.

VIII.                         Funding

Benefits payable
under this Addendum A shall be “unfunded,” as that term is used in Sections
201(2), 301(a)(3), 401(a)(1) and 4021(b)(6) of ERISA.  The Company shall not be required to
segregate or earmark any of its assets for the benefit of Executive or his
Beneficiary, and each of Executive and his Beneficiary shall have only a
contractual right against the Company for benefits payable under this
Agreement.  The rights and interests of
Executive and his Beneficiary under this Addendum A shall not be subject in any
manner to anticipation, alienation, sale, transfer, assignment, pledge or
encumbrance by Executive, his Beneficiary or any person claiming under or
through Executive or his Beneficiary, nor shall

 30
 

they
be subject to the debts, contracts, liabilities or torts of Executive or his
Beneficiary or anyone else prior to payment.

IX.                                Claims

Claims for
benefits under this Addendum A shall be administered in accordance with the
ERISA claims procedures set forth in the Company’s Supplemental Executive
Retirement Plan as in effect from time to time. 
Following Executive’s exhaustion of such claims procedures, claims shall
be settled exclusively by arbitration in accordance with the provisions of
Section 11(c) of the Employment Agreement. 
As provided in Section 11(b) of the Employment Agreement, all reasonable
costs and expenses (including fees and disbursements of counsel) incurred by
Executive in seeking to interpret this Addendum A or enforce rights pursuant to
this Addendum A shall be paid on behalf of or reimbursed to Executive 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) of the Employment
Agreement.

 31Exhibit
10.57.1

First
Amendment to the

Employment Agreement for Robert H. Steinfeld

As Amended and Restated as of February 11, 2003

THIS
FIRST AMENDMENT to the Employment Agreement by and between
IMS Health Incorporated (the “Company”) and Robert H. Steinfeld (“Executive”)
as amended and restated at February 11, 2003 (the “Agreement”) shall become
effective as of January 1, 2005.

WHEREAS,  the Company and Executive entered into the
Agreement effective as of November 14, 2000 and amended and restated the Agreement
effective as of February 11, 2003; and

WHEREAS,
the Company and Executive desire to amend the Agreement to comply with the
requirements of Section 409A of the Internal Revenue Code of 1986, as amended,
effective January 1, 2005 and in certain other respects.

NOW,
THEREFORE, in consideration of the foregoing, the Company and
Executive hereby agree as follows:

1.                                       The
last sentence of Section 4(b) of the Agreement is amended to read as follows:

“Any annual incentive compensation payable to Executive shall be paid
in accordance with the applicable plan (except to the extent deferred under
Section 5(d)).”

2.                                       Section
5(f) of the Agreement is amended to read in its entirety as follows:

“(f)  Reimbursement of
Expenses.  The Company will 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, any such reimbursement
to be made in a lump sum in the year in which Executive submits to the Company
a receipt for any such expense or disbursement.”

3.                                       The
following new subsection (g) is added to the end of Section 5 of the Agreement:

“(g)  Limitations Under Code Section 409A. 
Anything in this Section 5 to the contrary notwithstanding, with respect to any
payment otherwise required hereunder, in the event of any delay in the payment
date as a result of Section 7(g) of this Agreement (relating to the six-month
delay in payment of certain benefits to Specified Employees as required by
Section 409A of the Code), the Company will adjust the payment to reflect the
deferred payment date by multiplying the payment by the product of the
six-month CMT Treasury Bill annualized yield rate as published by the U.S.
Treasury for the date on which such payment would have

been made but for the delay multiplied by a fraction, the numerator of
which is the number of days by which such payment was delayed and the
denominator of which is 365. The Company will pay the adjusted payment at the
beginning of the seventh month following Executive’s termination of
employment.  Notwithstanding the
foregoing, if calculation of the amounts payable by such payment date is not
administratively practicable due to events beyond the control of Executive (or
Executive’s beneficiary or estate) and for reasons that are commercially
reasonable, payment will be made as soon as administratively practicable in
compliance with Section 409A of the Code and the proposed and final Treasury
Regulations thereunder, as the same may be amended from time to time (the “Regulations”).
In the event of Executive’s death during such six-month period, payment will be
made in the payroll period next following the payroll period in which Executive’s
death occurs.”

4.                                       The
second sentence of Section 6(a) of the Agreement before the colon is amended to
read as follows:

“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 at the time specified in Section
6(d), and Executive will be entitled to receive, the following:”

5.                                       Section
6(a)(ii) of the Agreement is amended to read in its entirety as follows:

“(ii) In lieu of any annual incentive compensation under Section 4(b)
for the year in which Executive’s employment terminated, a lump sum 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 and paid at the time
specified in the applicable plan), 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;”

6.                                       Section
6(a)(v) of the Agreement is amended to read in its entirety as follows:

“(v) If Executive shall not be eligible upon Retirement
for retiree coverage under the Company’s Health Plan (the “Health Plan”),
Executive shall instead be paid cash payments until Executive attains age 65
(or the date Medicare coverage becomes available to Executive, if later)
equivalent on an after-tax basis to the value of the retiree health benefits
that Executive would have received under the Company’s Health Plan had
Executive qualified for full retiree health benefits under the Company’s Health
Plan, with such payments to be made by the

 2
 

Company to Executive on a monthly basis (it being
understood that the Company payments to Executive attributable to these retiree
health benefits will be equal on an after-tax basis to the monthly premium cost
to Executive to purchase such benefits separately, which shall not exceed the
highest risk premium charged by a carrier having an investment grade or better
credit rating).”

7.                                       The
first sentence of Section 6(b) of the Agreement before the colon is amended to
read as follows:

“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 at the time specified in
Section 6(d), and Executive’s beneficiary or estate will be entitled to
receive, the following:”

8.                                       Section
6(b)(ii) of the Agreement is amended to read in its entirety as follows:

“(ii)  In lieu of any annual
incentive compensation under Section 4(b) for the year in which Executive’s
death occurred, a lump sum 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 and paid at the time specified in the applicable plan),
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;”

9.                                       The
second sentence of Section 6(c) of the Agreement before the colon is amended to
read as follows:

“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 at the time specified in Section 6(d), and Executive will be
entitled to receive, the following:”

10.                                 Section
6(c)(ii) of the Agreement is amended to read in its entirety as follows:

“(ii)  In lieu of any annual incentive compensation under
Section 4(b) for the year in which Executive’s employment terminated, a lump
sum 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

 3
 

performance actually achieved in that year (determined by the Committee
following completion of the performance year and paid at the time specified in
the applicable plan), 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;”

11.                                 Section
6(c)(vi) of the Agreement is amended to read in its entirety as follows:

“(vi) For the period extending from the date of termination due to
Disability until the date Executive reaches age 65 (or the date Medicare
coverage becomes available to Executive, if later), 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,
disability 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
instead be paid cash payments equivalent on an after-tax basis to the value of
the additional benefits 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 (or the date
Medicare coverage becomes available, if later), with such payments to be made
by the Company to Executive on a monthly basis (it being understood that the
Company payments to Executive attributable to these benefits will be equal on
an after-tax basis to the monthly premium cost to Executive to purchase such
benefits separately, 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 6(c)(vi).”

12.                                 Section
6(d) of the Agreement is amended to read in its entirety as follows:

“(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 in the payroll period next following
the payroll period in which

 4
 

termination of employment occurs; subject, however, to the provisions
of Section 7(g) of this Agreement relating to the six-month delay in payment of
certain benefits to Specified Employees as required by Section 409A of the
Code. Any payment due within such six-month period shall be delayed to the end
of such six-month period as required by Section 7(g). The Company will adjust
the payment to reflect the deferred payment date by multiplying the payment by
the product of the six-month CMT Treasury Bill annualized yield rate as
published by the U.S. Treasury for the date on which such payment would have
been made but for the delay multiplied by a fraction, the numerator of which is
the number of days by which such payment was delayed and the denominator of
which is 365. The Company will pay the adjusted payment at the beginning of the
seventh month following Executive’s termination of employment.  Notwithstanding the foregoing, if calculation
of the amounts payable by such payment date is not administratively practicable
due to events beyond the control of Executive (or Executive’s beneficiary or
estate) and for reasons that are commercially reasonable, payment will be made
as soon as administratively practicable in compliance with Section 409A of the
Code and the Regulations. In the event of Executive’s death during such
six-month period, payment will be made in the payroll period next following the
payroll period in which Executive’s death occurs.”

13.                                 The
second sentence of Section 7(a) of the Agreement before the colon is amended to
read as follows:

“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 at the time specified in Section 7(g), and
Executive will be entitled to receive, the following:”

14.                                 The
third sentence of Section 7(b) of the Agreement before the colon is amended to
read as follows:

“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 at the time specified in Section
7(g), and Executive will be entitled to receive, the following:”

15.                                 The
fourth sentence of Section 7(c) of the Agreement before the colon is amended to
read as follows:

“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

 5
 

Agreement will immediately cease (except for obligations which continue
after termination of employment as expressly provided herein), and the Company
will pay Executive at the time specified in Section 7(g), and Executive will be
entitled to receive, the following:”

16.                                 The
last sentence of Section 7(c)(ii) of the Agreement is amended to read as
follows:

“The amount determined to be payable under this Section 7(c)(ii) shall
be paid in a lump sum;”

17.                                 Section
7(c)(iii) of the Agreement is amended to read in its entirety as follows:

“(iii)  In lieu of any annual incentive compensation under
Section 4(b) for the year in which Executive’s employment terminated, a lump
sum 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;”

18.                                 Section
7(c)(viii) of the Agreement is amended to read in its entirety as follows:

“(viii) For a period of two years after such termination (but not
after Executive attains age 65 or the date Medicare coverage becomes available
to Executive, if later), 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, disability 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 instead be paid
cash payments 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 payments to be made by the Company to Executive on a monthly
basis (it being understood that the Company payments to Executive attributable
to these benefits will be equal on an after-tax basis to the monthly premium
cost to Executive to purchase such benefits separately, which shall not

 6
 

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
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(c)(viii) if the Company had
received adequate prior notice as required by this sentence.”

19.                                 The
second sentence of Section 7(d) of the Agreement before the colon is amended to
read as follows:

“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 at the time specified in Section 7(g), and
Executive will be entitled to receive, the following:”

20.                                 The
last sentence of Section 7(d)(ii) of the Agreement is amended to read as
follows:

“The amount determined to be payable under this Section 7(d)(ii) shall
be paid in a lump sum;”

21.                                 Section
7(d)(iii) of the Agreement is amended to read in its entirety as follows:

“(iii) In lieu of any annual incentive compensation under Section
4(b) for the year in which Executive’s employment terminated, a lump sum 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;”

22.                                 Section
7(d)(viii) of the Agreement is amended to read in its entirety as follows:

“(viii)   For a period of two years
after such termination (but not after Executive attains age 65 or the date Medicare
coverage becomes available to Executive, if later), Executive shall continue to
participate in those employee and executive

 7
 

benefit plans and programs under
Section 5(b) to the extent such plans and programs provide medical,
disability 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 cash payments 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 payments to be made by the Company to
Executive on a monthly basis (it being understood that the Company payments to
Executive attributable to these benefits will be equal on an after-tax basis to
the monthly premium cost to Executive to purchase such benefits separately,
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.”

23.                                 The
fourth sentence of Section 7(e) of the Agreement before the colon is amended to
read as follows:

“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 at the time specified in Section 7(g), and Executive will be
entitled to receive, the following:”

24.                                 The
last sentence of Section 7(e)(ii) is amended to read as follows:

 8
 

“The amount determined to be payable under this Section 7(e)(ii) shall
be paid by the Company in a lump sum;”

25.                                 Section
7(e)(iii) of the Agreement is amended to read in its entirety as follows:

“(iii) In lieu of any annual incentive compensation under Section
4(b) for the year in which Executive’s employment terminated, a lump sum 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;”

26.                                 Section
7(e)(viii) of the Agreement is amended to read in its entirety as follows:

“(viii) For a period of three years after such termination (but
not after Executive attains age 65 or the date Medicare coverage becomes
available to Executive, if later), 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,
disability 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, and on terms no less favorable
than the terms applicable to Executive before the Change in Control; 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(e)(viii) do not allow Executive’s continued
participation, Executive shall instead be paid cash payments 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 payments
to be made by the Company to Executive on a monthly basis (it being understood
that the Company payments to Executive attributable to these benefits will be
equal on an after-tax basis to the monthly premium cost to Executive to
purchase such benefits separately, 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

 9
 

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.”

27.                                 The
second sentence of Section 7(f) of the Agreement before the colon is amended to
read as follows:

“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 at the time specified in
Section 7(g), and Executive will be entitled to receive, the following:”

28.                                 The
last sentence of Section 7(f)(ii) of the Agreement is amended to read as
follows:

“The amount determined to be payable under this
Section 7(f)(ii) shall be paid in a lump sum;”

29.                                 Section
7(f)(iii) of the Agreement is amended to read in its entirety as follows:

“(iii)    In lieu of any annual incentive
compensation under Section 4(b) for the year in which Executive’s employment
terminated, a lump sum 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;”

30.                                 Section
7(f)(viii) of the Agreement is amended to read in its entirety as follows:

“(viii) For a period of three years after such
termination (but not after Executive attains age 65 or the date Medicare
coverage becomes available to Executive, if later), 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,
disability 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, and on terms no less favorable
than the terms applicable to Executive before the Change in Control;

 10
 

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 cash
payments 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 payments to be made by the Company to Executive on a monthly
basis (it being understood that the Company payments to Executive attributable
to these benefits will be equal on an after-tax basis to the monthly premium
cost to Executive to purchase such benefits separately, 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.”

31.                                 Section
7(g) of the Agreement is amended to read in its entirety as follows:

“(g)  Other Terms Relating to Certain
Terminations of Employment; Delayed Payments Under Section 409A. 
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 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 in the payroll period next following the payroll period in
which termination of employment occurs except as otherwise provided in this
Section 7. Anything in this Agreement to the contrary notwithstanding, payments
to be made under this Agreement upon termination of Executive’s employment
which are subject to Section 409A of the Code shall be delayed for six months
following such termination of employment if Executive is a Specified Employee
as defined in Section 8(g) on the date of his termination of employment.  Any payment due

 11
 

within such six-month period shall be delayed to the
end of such six-month period. The Company will adjust the payment to reflect
the deferred payment date by multiplying the payment by the product of the
six-month CMT Treasury Bill annualized yield rate as published by the U.S.
Treasury for the date on which such payment would have been made but for the
delay multiplied by a fraction, the numerator of which is the number of days by
which such payment was delayed and the denominator of which is 365. The Company
will pay the adjusted payment at the beginning of the seventh month following
Executive’s termination of employment. Notwithstanding the foregoing, if
calculation of the amounts payable by any payment date specified in this
Section 7(g) is not administratively practicable due to events beyond the
control of Executive (or Executive’s beneficiary or estate) and for reasons
that are commercially reasonable, payment will be made as soon as
administratively practicable in compliance with Section 409A of the Code and
the Regulations thereunder.  In the event
of Executive’s death during such six-month period, payment will be made in the
payroll period next following the payroll period in which Executive’s death
occurs.”

32.                                 Section
8(c)(i) of the Agreement is amended to read in its entirety as follows:

“(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 a lump sum at the time specified in Section 6(d) or
Section 7(g), as the case may be;”

33.                                 Section
8(c)(iii) of the Agreement is amended to read in its entirety as follows:

“(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,
payable in a lump sum at the time specified in Section 6(d) or Section 7(g), as
the case may be.”

34.                                 The
following new subsection (g) is added to the end of Section 8 of the Agreement:

“(g)                           “Specified
Employee”    For purposes of this
Agreement, a “Specified Employee” shall mean an employee of the Company who
satisfies the requirements for being designated a “key employee” under Section
416(i)(1)(A)(i), (ii) or (iii) of the Code without regard to Section 416(i)(5)
of the Code at any time during a calendar year, in which case such employee
shall be considered a Specified Employee for the twelve-month period beginning
on the first day of the fourth month immediately following the end of such
calendar year. Notwithstanding the foregoing, all employees who are nonresident
aliens during an entire calendar year are excluded for purposes of determining
which employees meet the requirements of Section 416(i)(1)(A)(i), (ii) or (iii)
of the Code without regard to Section 416(i)(5) of the Code for such calendar
year. The

 12
 

term “nonresident alien” as used herein shall have the meaning set
forth in Regulations Section 1.409A-1(j). 
In the event of any corporate spinoff or merger, the determination of
which employees meet the requirements of Section 416(i)(1)(A)(i), (ii) or (iii)
of the Code without regard to Section 416(i)(5) of the Code for any calendar
year shall be determined in accordance with Regulations Section 1.409A-1(i)(2).”

35.                                 Section
9(b)(iii) of the Agreement is amended to read in its entirety as follows:

“(iii)  The payments provided for in this Section 9(b) shall
be made on 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 administratively practicable in compliance with Section 409A
of the Code and the Regulations thereunder but in no event later than the
thirtieth day after the date of Executive’s termination of employment subject,
however, to any delay in the payment date as a result of Section 7(g) of this
Agreement (relating to the six-month delay in payment of certain benefits to
Specified Employees as required by Section 409A of the Code).  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).”

36.                                 The
following new provisions are added to the end of Section 11(a) of the
Agreement:

“Anything in this Agreement to the contrary notwithstanding, the terms
of this Agreement shall be interpreted and applied in a manner consistent with
the requirements of Section 409A of the Code and the Regulations thereunder and
the Company shall have no right to accelerate or make any payment under this
Agreement except to the extent permitted under Section 409A of the Code.  The Company shall have no obligation,
however, to reimburse Executive for any tax penalty or interest payable or
provide a gross-up payment in connection with any tax liability of Executive
under Section 409A of the Code except that this provision shall not apply in
the event of the Company’s negligence or willful disregard in interpreting the
application of Section 409A of the Code to 
this Agreement which negligence or willful disregard causes Executive to
become subject to a tax penalty or interest payable under Section 409A of the
Code nor shall this provision be interpreted to limit any gross-up payable to
Executive under Section 9(b) of this Agreement.”

37.                                 Section
11(b) of the Agreement is amended to read in its entirety as follows:

 13
 

“(b)  Reimbursement of Expenses in Enforcing Rights. 
Upon submission of invoices, the Company shall promptly pay or reimburse all
reasonable costs and expenses (including fees and disbursements of counsel and
pension experts) incurred by Executive or Executive’s surviving spouse in
seeking to interpret this Agreement or enforce rights pursuant to this
Agreement or in any proceeding in connection therewith brought by Executive or
Executive’s surviving spouse, whether or not Executive or Executive’s surviving
spouse is ultimately successful in enforcing such rights or in such proceeding;
provided, however, that no reimbursement shall be owed with respect to expenses
relating to any unsuccessful assertion of rights or proceeding if and to the
extent that such assertion or proceeding  was initiated or maintained in
bad faith or was frivolous, as determined by the arbitrators in accordance with
Section 11(c) or a court having jurisdiction over the matter.  Any such payment or reimbursement shall be
made in a lump sum in the month next following the month in which such costs
and expenses are incurred subject to Executive’s submission of receipts for
such expenses.”

38.                                 The
second to last sentence in Section 11(c) of the Agreement is amended to read as
follows:

“Subject to Section 11(b) of this Agreement, the Company shall bear all
costs and expenses arising in connection with any arbitration proceeding
pursuant to this Section 11 and shall pay such costs and expenses in the tax
year in which incurred.”

39.                                 The
following new clause is added to the end of Section 11(d) of the Agreement
before the period:

“except as otherwise provided in Sections 5(g) and 7(g) of this
Agreement (concerning interest payable with respect to delayed payments under
Section 409A of the Code).”

IN
WITNESS WHEREOF, Executive has hereunto set his hand and the
Company has caused this instrument to be duly executed as of the 17th day of
October, 2006.

	
   

  	
  IMS HEALTH INCORPORATED

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ David R. Carlucci

  	
   

  
	
   

  	
  Name: David R.
  Carlucci

  
	
   

  	
  Title: Chief
  Executive Officer and President

  
	
   

  	
   

  
	
   

  	
  /s/ Robert H.
  Steinfeld

  	
   

  
	
   

  	
  Robert H.
  Steinfeld

  
						

 

 14

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