Document:

Exhibit 10(u)-2

SECRETARIAL CERTIFICATION

OF THE

COMPENSATION/NOMINATING/CORPORATE GOVERNANCE

COMMITTEE

TCF FINANCIAL CORPORATION

October 20, 2008

*********************************************************************

Following discussion,
and upon motion duly made, seconded and carried, the following was adopted:

 

RE:  Amendment to TCF Financial Corporation Cash
Balance Pension Plan SERP (Adopted effective as of January 1, 2005)

 

WHEREAS,
the TCF Financial Corporation Cash Balance Pension Plan SERP (Adopted effective
as of January 1, 2005) (“CBPP SERP II”) applies to benefits based on
Covered Compensation earned in calendar year 2005 and thereafter; and

 

WHEREAS,
the Supplemental Employee Retirement Plan for TCF Cash Balance Pension Plan (As
Amended and Restated through January 24, 2005) (“CBPP SERP I”), which
applies to benefits based on Covered Compensation earned in calendar year 2004
and before, has been amended to subject certain benefits payable thereunder to
the provisions of CBPP SERP II; and

 

WHEREAS,
the Committee wishes to amend CBPP SERP II to reflect the amendment to CBPP
SERP I and to provide for the distribution of all benefits in 2009:

 

NOW, THEREFORE, IT IS HEREBY

 

RESOLVED,
that the first paragraph of Section I of the Plan (“Purpose of Plan;
Effective Date of Plan; Effect of Previous SERP Plan”) is amended in its
entirety, to read as follows:

 

“The
purpose of this Plan is to provide Eligible Employees with supplemental
retirement benefits as set forth herein to remedy certain limitations or reductions
in benefits under the IRC, as set forth herein, to such Employees under the TCF
Cash Balance Pension Plan (“Cash Balance Plan”).  This Plan is effective for benefits based on
Covered Compensation earned in calendar year 2005 and thereafter and, in the
case of participants who are employed by TCF Financial or any of its direct or
indirect subsidiaries on December 31, 2008, for benefits based on Covered
Compensation earned in calendar year 2004 and before.  A previous plan, the Supplemental Employee
Retirement Plan for TCF Cash Balance Pension Plan (the “Previous SERP Plan”) is
in effect for participants who are not employed by TCF Financial or any of its
direct or indirect subsidiaries on December 31, 2008 for benefits based on
Covered Compensation earned in calendar year 2004 and before.  The Previous SERP Plan is not terminated or
superseded by this Plan for such Participants, but remains in effect for
benefits accrued by such participants under it before the adoption of this
Plan.  In no event shall any benefits be
due under both this Plan and the Previous SERP Plan with respect to the same
Covered Compensation and there shall be no duplication of benefits between this
Plan and the Previous SERP Plan.”

 

 

FURTHER
RESOLVED, that paragraph (c) of Section IV of the Plan (“Payment of
Benefits”) is amended in its entirety, to read as follows:

 

“(c)         Payment of Benefits.  Each Eligible Employee shall receive a lump
sum distribution in the form of cash equal to the then-current value of such
Employee’s account in this Plan (less applicable withholding) in calendar year
2009; provided, that in the case of an Eligible Employee who separated from
service (within the meaning of IRC § 409A) prior to January 1, 2009,
such distribution shall not be made until six months after the Employee’s
separation from service.  All distributions to an Eligible Employee, beneficiary or survivor
under this Article IV shall be in the form of cash.”

 

FURTHER
RESOLVED, that a new paragraph (f) is added at the end of Section IX
of the Plan (“Miscellaneous”), to read as follows:

 

“(f)          This Plan is intended to satisfy the
requirements for nonqualified deferred compensation plans set forth in IRC §
409A, and it shall be interpreted, administered and construed consistent with
said intent.”

 

This
amendment is effective as of December 31, 2008, with respect to CBPP SERP
II participants who have not received distribution of their benefits prior to
that date.  The changes made by this
amendment are intended to qualify for the transitional relief set forth in
Q&A-19(c) of IRS Notice 2005-1, as amended and clarified by IRS Notices 2006-79
and 2007-86, and they shall be interpreted, administered and construed
consistent with said intent. 
Specifically, and for the avoidance of doubt, this amendment shall not
cause any amount that would otherwise be payable in 2008 to be paid in a later
year, and shall not cause any amount that would otherwise be payable in a later
year to be paid in 2008.

 

I,
Gregory J. Pulles, Secretary of TCF Financial Corporation do hereby certify
that the foregoing is a true and correct copy of excerpt of the unanimous
written consent of the Independent Sub Committee of the Compensation Committee
of the Board of Directors of TCF Financial Corporation adopted on October 20,
2008 and that the unanimous written consent has not been modified or rescinded
as of the date hereof.

 

Dated:  October 20, 2008

 

 

 

(Corporate
Seal)

	
   

  	
   

  	
  /s/
  Gregory J. Pulles

  
	
   

  	
   

  	
  Gregory
  J. Pulles, SecretaryExhibit 10(u)-3

SECRETARIAL CERTIFICATION

OF THE

COMPENSATION/NOMINATING/CORPORATE GOVERNANCE

COMMITTEE

TCF FINANCIAL CORPORATION

October 20, 2008

*********************************************************************

Following discussion,
and upon motion duly made, seconded and carried, the following was adopted:

 

RE:  Amendment to Supplemental Employee Retirement
Plan for TCF Cash Balance Pension Plan (As Amended and Restated through January 24,
2005)

 

WHEREAS,
the Supplemental Employee Retirement Plan for TCF Cash Balance Pension Plan (As
Amended and Restated through January 24, 2005) (“CBPP SERP I”) applies to
benefits based on Covered Compensation earned in calendar year 2004 and before;
and

 

WHEREAS,
the Committee wishes to amend CBPP SERP I to subject certain benefits payable
thereunder to the provisions of the TCF Financial Corporation Cash Balance
Pension Plan SERP (Adopted effective as of January 1, 2005) (“CBPP SERP II”),
which applies to benefits based on Covered Compensation earned in calendar year
2005 and thereafter:

 

NOW, THEREFORE, IT IS HEREBY

 

RESOLVED,
that effective as of December 31, 2008, CBPP SERP I is hereby amended to
read identically to the plan document for CBPP SERP II, as amended and in
effect on December 31, 2008, with respect to benefits payable to
participants who are employed by TCF Financial, or any of its direct or
indirect subsidiaries, on December 31, 2008.  From and after December 31, 2008,
benefits payable to such participants based on Covered Compensation earned in
calendar year 2004 and before shall be governed by the plan document for CBPP
SERP II, as the same may be amended from time to time.  This amendment shall not apply to
participants who are not employed by TCF Financial, or any of its direct or
indirect subsidiaries, on December 31, 2008, and benefits payable to such
participants based on Covered Compensation earned in calendar year 2004 and
before shall continue to be governed by the plan document for CBPP SERP I, as
in effect prior to this amendment.

 

This
amendment is effective as of December 31, 2008.

 

I,
Gregory J. Pulles, Secretary of TCF Financial Corporation do hereby certify
that the foregoing is a true and correct copy of excerpt of the unanimous
written consent of the Independent Sub Committee of the Compensation Committee
of the Board of Directors of TCF Financial Corporation adopted on October 20,
2008 and that the unanimous written consent has not been modified or rescinded
as of the date hereof.

 

Dated:  October 20, 2008

 

 

 

(Corporate
Seal)

	
   

  	
  /s/
  Gregory J. Pulles

  
	
   

  	
  Gregory J. Pulles, SecretaryEXHIBIT 10.1

 

 

Employment Agreement for Gilles Pajot

 

As Amended and Restated as of May 7,
2006

 

 

IMS HEALTH INCORPORATED

 

Employment Agreement for Gilles Pajot

 

As Amended and Restated
Effective May 7, 2006

 

THIS
EMPLOYMENT AGREEMENT (the “Agreement”) by and between IMS HEALTH INCORPORATED,
a Delaware corporation (the “Company,” subject to Section 12(b)), and
Gilles Pajot (“Executive”), which was first effective as of November 14,
2000 (the “Effective Date”) and thereafter amended and restated as of February 16,
2006 and again as of May 7, 2006 is hereby amended and restated in its
entirety 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 and Chief Operating Officer 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
Agreement to become subject to Section 409A of the Internal Revenue Code
of 1986, as amended (the “Code”); and

 

WHEREAS, Executive and the Company desire to
amend and restate this Agreement in its entirety to comply with the
requirements of Section 409A of the Code and the Treasury Regulations
thereunder (the “Regulations) and in certain other respects effective as of the
Restatement Date.

 

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 and Chief Operating Officer and Executive
hereby agrees to accept such employment and serve in such capacities, during
the Term as defined in Section 2 (subject to Sections 7(c) and 7(e))
and upon the terms and conditions set forth in this Agreement.

 

2.             Term.

 

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

 

1

 

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
until the day after the earlier of (a) the date the Change in Control is
consummated; or (b) the date the Change in Control contemplated by such
Potential Change in Control is fully and finally abandoned. Any termination by
the Company of Executive’s employment without Cause (as defined in Section 8(a))
or any termination by Executive of his employment for Good Reason (as defined
in Section 8(e)(i) through (ix)) following the occurrence of such
Potential Change in Control but prior to the Change in Control contemplated by
such Potential Change in Control shall be deemed a termination by the Company
without Cause within two years after a Change in Control as set forth in Section 7(e) and
a termination by Executive for Good Reason within two years after a Change in
Control as set forth in Section 7(f), respectively, upon the occurrence of
the Change in Control contemplated by such Potential Change in Control and the
compensation and benefits payable pursuant to Sections 7(e) or 7(f), as
the case may be, shall be paid as provided therein as though Executive’s date
of termination had occurred immediately following such Change in Control;
provided, however, that the provisions of Sections 7(c) or 7(d),
respectively, shall continue to apply in the interim and there shall be no
duplication of any compensation or benefits theretofore paid or to be paid to
Executive pursuant to Sections 7(c) or 7(d).

 

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 Chief
Operating Officer 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 chief operating officer 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 Chief Operating Officer 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.

 

(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 Human Resources Committee (the Compensation and Benefits
Committee before January 

 

2

 

1, 2007) (the “Committee”) of the Board at
least once in each calendar year, and may be increased above, but may not be
reduced below, the then-current rate of such base salary.  For purposes of this Agreement, “Base Salary”
means Executive’s then-current base salary.

 

(b)           Annual
Incentive Compensation. The Company will pay to Executive during the Term
annual incentive compensation which shall offer to Executive an opportunity to
earn additional compensation based upon performance in amounts determined by
the Committee in accordance with the applicable plan and consistent with past
practices of the Company; provided, however, that the annual incentive
opportunity during the Term shall be not less than 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 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 

 

3

 

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 any
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 Chief Operating Officer 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 payroll period in which such expense is
incurred by Executive;

 

 (ii)          The
Company will provide Executive with coverage as Executive Vice President and
Chief Operating Officer 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. 
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
therefor under this Section 5(b)(vii), but the reimbursement for taxes
under this 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.

 

4

 

·      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 or reimbursed in accordance with the provisions of Section 7(g) of
this Agreement.

 

(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 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.

 

5

 

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)), the following benefits shall be
made available to Executive after the Term:

 

If Executive is eligible upon termination of
employment for retiree coverage under the Company’s Health Plan (the “Health
Plan”), Executive shall receive cash payments equal on an after-tax basis to
the cost for retiree coverage under the Health Plan for Executive, his spouse
and eligible dependents, with such payments to be made by the Company to
Executive on a monthly basis for so long as he shall be eligible for retiree
coverage under the Health Plan and in accordance with Section 7(g) of
this Agreement. If or when Executive is not eligible for retiree coverage under
the Health Plan (and eligibility for COBRA continuation coverage only shall not
be considered eligibility for retiree coverage under the Health Plan under this
Agreement), Executive shall instead receive cash payments equal on an after-tax
basis to the value of the retiree coverage that Executive would have received
under the Health Plan had Executive, his spouse and eligible dependents
qualified for full retiree coverage under the Health Plan, with such payments
to be made by the Company to Executive on a monthly basis for life and in
accordance with Section 7(g) of this Agreement (it being understood
that the Company payments to Executive attributable to this retiree coverage
will be equal on an after-tax basis to the full monthly premium cost to
Executive to purchase such coverage independently, and shall not be limited to
the value of the Company contribution, if any, to the cost of retiree coverage
under the Health Plan, but shall not exceed the highest risk premium charged by
a carrier having an investment grade or better credit rating). If Executive is
eligible upon termination of employment for COBRA continuation coverage under
the Health Plan and elects such coverage, Executive shall receive cash payments
equal on an after-tax basis to the full monthly premium cost to Executive to
purchase such COBRA continuation coverage for Executive, his spouse and
eligible dependents, with such payments to be made by the Company to Executive
on a monthly basis for the duration of Executive’s COBRA continuation period
and in accordance with Section 7(g) of this Agreement, which payments
shall be made in lieu of any payments provided hereinabove that would otherwise
be made during the COBRA continuation period so that there is no duplication of
payments during the COBRA continuation period.

 

(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 units, stock appreciation rights,
restricted stock, and other equity-based awards then held by Executive shall
become vested, and in the case of options and stock appreciation rights,
exercisable.  In the event that any such
vested equity-based award that is subject to Section 409A of the Code
cannot be paid to Executive upon such Change in Control because such Change in
Control does not qualify as a change in control within the meaning provided by
Section 1.409A-3(i)(5) of the Regulations, Executive shall have the
right to elect to denominate such award in cash both at the time of the Change
in Control (as defined in Section 8(b) of this Agreement) and again
upon termination of employment following the Change in Control.  If Executive elects to denominate such award
in cash, the Company will adjust the cash 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 the award was denominated in cash (or the most appropriate
surrogate for such rate if such rate is not available) multiplied by a
fraction, the numerator of which is the number of days from and including the
date on which the award was denominated in cash until and including the date of
payment of such award to Executive and the denominator of which is 365 and pay
such adjusted amount.

 

(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 

 

6

 

additional salary, annual incentive, or other
compensation for purposes of determining such benefits, unless otherwise
expressly provided under such plan or program.

 

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

 

(f)            Reimbursement of
Expenses.  The Company will 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 and the provisions of Section 7(g) of this Agreement.  If Executive becomes subject to Federal,
state or local income tax on any such reimbursement, such taxable reimbursement
shall be made on a fully grossed-up and after-tax basis so that Executive is
held economically harmless.

 

(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 (or the most appropriate surrogate for such rate if such rate is not
available)multiplied by a fraction, the numerator of which is the number of
days 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.

 

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:

 

7

 

(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 a fraction the numerator of which is the number
of days Executive was employed in the year of termination and the denominator
of which is the total number of days in the year of termination;

 

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

 

8

 

(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;

 

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

 

(iv)          The
performance period under any long-term incentive plan pursuant to which equity
or other awards have been granted shall be treated as satisfied and any
performance objectives upon which the earning of performance-based restricted
stock and deferred stock awards and other long-term incentive awards is
conditioned shall be deemed to have been met at target level at the date of
termination. PERS for the year of termination shall be awarded which match the
dollar value pro-rata amount of annual incentive compensation payable pursuant
to Section 6(c)(ii) above and such PERS awards together with all
previously granted and outstanding PERS awards, restricted stock, restricted
stock units, deferred stock awards and other long-term incentive awards (to the
extent then or previously earned, or earned as a result of this Section) 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)          Executive
shall continue to participate for the remainder of his life in those employee
and executive benefit plans and programs under Section 5(b) in which
Executive was participating immediately prior to termination to the extent such
plans and programs provide medical benefits and shall continue to participate
until the later of Executive’s attainment of age 65 and the date participation
is generally available to employees in those employee and executive benefit
plans and programs under Section 5(b) in which Executive was
participating immediately prior to termination to the extent such plans and
programs provide disability benefits and shall continue to participate until
age 65 in such plans and programs to the extent they provide life insurance
benefits, provided the terms of all such plans and programs allow Executive’s
continued participation, as if Executive had continued in employment with the
Company during such period.   For so long
as Executive shall participate in the Company plans and programs referred to in
this Section 6(c)(vi), Executive shall receive cash payments equal on an
after-tax basis to his cost for participating in such plans and programs, with
such payments to be made by the Company to Executive on a monthly basis and in
accordance with Section 7(g) of this Agreement.  If or when the terms of the Company plans and
programs referred to in this Section 6(c)(vi) 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) that Executive would have received
under such plans or programs had Executive continued to be employed for the
remainder of his life in the case of medical benefits and until the later of
age 65 and the date participation is generally available to employees in the
case of plans and programs which provide disability benefits and until age 65
in the case of plans and programs which provide life insurance benefits, with
such payments to be made by the Company to Executive on a monthly basis and in
accordance with Section 7(g) of this Agreement (it being understood
that the Company payments to Executive attributable to these benefits will be
equal on an after-tax basis to the full monthly premium cost to Executive to
purchase such benefits independently, and shall not be limited to the value of
the Company contribution, if any, to the cost of an employee’s coverage under
any such medical, disability or life benefits plan, but shall not exceed the
highest risk premium charged by a carrier having an 

 

9

 

investment grade or better credit rating).
Notwithstanding the foregoing, Executive must continue to satisfy the
conditions set forth in Section 10 in order to continue receiving the
benefits provided under this Section 6(c)(vi).

 

 (d)          Other Terms of Payment Following
Retirement, Death, or Disability. Nothing in this Section 6 shall
limit the benefits payable or provided in the event Executive’s employment
terminates due to Retirement, death, or Disability under the terms of plans or
programs of the Company more favorable to the Executive (or his beneficiaries)
than the benefits payable or provided under this Section 6 (except in the
case of annual incentives in lieu of which amounts are paid hereunder),
including plans and programs adopted after the date of this Agreement. 
Amounts payable under this Section 6 following Executive’s termination of
employment, other than those expressly payable following determination of
performance for the year of termination for purposes of annual incentive
compensation or otherwise expressly payable on a deferred basis, will be paid
in the payroll period next following the payroll period in which 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 or reimbursement 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 or reimbursement
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 or reimbursement would have
been made but for the delay (or the most appropriate surrogate for such rate if
such rate is not available) multiplied by a fraction, the numerator of which is
the number of days by which such payment or reimbursement was delayed and the
denominator of which is 365. In the event of a reimbursement that is required
by other terms of this Agreement to be made on an after-tax basis which is
subject to the six-month delay in payment as described in
Section 7(g) of this Agreement, the reimbursement as adjusted in accordance
with this Section 6(d) to reflect the deferred payment date shall be
paid to Executive on an after-tax and fully grossed-up basis so that Executive
is held economically harmless. The Company will pay the adjusted payment or
reimbursement 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.

 

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, stock appreciation rights, 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 

 

10

 

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, stock appreciation rights, 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)).

 

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

 

11

 

(iv)          Stock
options and stock appreciation rights 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 and stock appreciation rights
may be exercised), such options and stock appreciation rights shall be governed
by the plans and programs and the agreements and other documents pursuant to
which such options and stock appreciation rights were granted;

 

(v)           The
performance period under any long-term incentive plan pursuant to which equity
or other awards have been granted shall be treated as satisfied and any
performance objectives upon which the earning of performance-based restricted
stock and deferred stock awards and other long-term incentive awards is
conditioned shall be deemed to have been met at target level at the date of
termination. PERS for the year of termination shall be awarded which match the
dollar value pro-rata amount of annual incentive compensation payable pursuant
to Section 7(c)(iii) above and such PERS awards together with all
previously granted and outstanding PERS awards, restricted stock, restricted
stock units, deferred stock awards and other long-term incentive awards (to the
extent then or previously earned, or earned as a result of this Section) 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, 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 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. For so long as Executive
shall participate in the Company plans and programs referred to in this
Section 7(c)(viii), Executive shall receive cash payments equal on an
after-tax basis to his cost for participating in such plans and programs, with
such payments to be made by the Company to Executive on a monthly basis and in
accordance with Section 7(g) of this Agreement.  If or when 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) that 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 during such period and in accordance with
Section 7(g) of this Agreement (it being understood that the Company
payments to Executive attributable to these benefits will be equal on an
after-tax basis to the full monthly premium cost to Executive to purchase such
benefits independently, and shall not be limited to the value of the Company
contribution, if any, to the cost of an employee’s coverage under any such
medical, disability or life benefits plan, but shall not exceed the highest
risk premium charged by a carrier having an investment grade or better credit
rating). Notwithstanding the foregoing, 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.
Notwithstanding the foregoing, nothing in this
Section 7(c)(viii) shall alter any right Executive may have to 

 

12

 

participate in any Company medical,
disability or life insurance benefits plan or program that covers former
employees of the Company in accordance with the generally applicable terms of
such plan or program nor shall it alter Executive’s right to health coverage as
provided by Section 5(b) of this Agreement.

 

(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 and stock appreciation rights 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 and stock appreciation rights
may be exercised), such options and stock appreciation rights shall be governed
by the plans and programs and the agreements and other documents pursuant to
which such options and stock appreciation rights were granted;  provided, however, that no acceleration of vesting and
exercisability of any option or stock appreciation right 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); provided, however, if any option or stock
appreciation right granted after January 1, 2006 does not become fully
vested and exercisable upon Executive’s termination of employment (governed by
this Section 7(d)(iv)) after a Potential Change in Control but before the
Change in Control contemplated by such Potential Change in Control occurs, such
option or stock appreciation right shall remain in effect but not be
exercisable unless and until Executive thereafter becomes entitled to the full
vesting and exercisability of such option or stock appreciation right pursuant
to Section 2 of this Agreement upon occurrence of such Change in Control, and,
in such case, if such option or stock appreciation right cannot be exercised
due to the expiration of the term between the date of Executive’s termination
of employment and the date of such Change in Control, the Company shall pay to
Executive in one lump sum in the payroll period following the payroll period in
which such Change in Control occurs an amount equal to the difference between
the exercise price of such option or stock appreciation right and its fair
market value on the date of such Change in Control.

 

(v)           The
performance period under any long-term incentive plan pursuant to which equity
or other awards have been granted shall be treated as satisfied and any
performance objectives upon which the earning of performance-based restricted
stock and deferred stock awards and other long-term incentive awards is
conditioned shall be deemed to have been met at target level at the date of
termination.  PERS for the year of
termination shall be awarded which match the dollar value pro-rata amount of
annual incentive compensation payable pursuant to
Section 7(d)(iii) above and such PERS awards together with all
outstanding PERS awards, restricted stock, deferred stock awards and other
long-term incentive awards (to the extent then or previously earned, or earned
as a result of this Section) 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 

 

13

 

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, 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 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. For so long as
Executive shall participate in the Company plans and programs referred to in
this Section 7(d)(viii), Executive shall receive cash payments equal on an
after-tax basis to his cost for participating in such plans and programs, with
such payments to be made by the Company to Executive on a monthly basis and in
accordance with Section 7(g) of this Agreement.  If or when 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) that 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 during such period and in accordance with
Section 7(g) of this Agreement (it being understood that the Company
payments to Executive attributable to these benefits will be equal on an
after-tax basis to the full monthly premium cost to Executive to purchase such
benefits independently, and shall not be limited to the value of the Company
contribution, if any, to the cost of an employee’s coverage under any such
medical, disability or life benefits plan, but shall not exceed the highest
risk premium charged by a carrier having an investment grade or better credit
rating).Notwithstanding the foregoing, 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. 
Notwithstanding the foregoing, nothing in this
Section 7(d)(viii) shall alter any right Executive may have to
participate in any Company medical, disability or life insurance benefits plan
or program that covers former employees of the Company in accordance with the
generally applicable terms of such plan or program nor shall it alter
Executive’s right to health coverage as provided by Section 5(b) of
this Agreement.

 

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 

 

14

 

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 and stock appreciation rights 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 or stock appreciation rights
granted on or after the Effective Date shall remain outstanding and exercisable
until the stated expiration date of the option or stock appreciation right as
though Executive’s employment did not terminate, and, in other respects, such
options and stock appreciation rights shall be governed by the plans and
programs and the agreements and other documents pursuant to which such options
and stock appreciation rights were granted;

 

(v)           The
performance period under any long-term incentive plan pursuant to which equity
or other awards have been granted shall be treated as satisfied and any
performance objectives upon which the earning of performance-based restricted
stock and deferred stock awards and other long-term incentive awards is
conditioned shall be deemed to have been met at target level at the date of
termination.  PERS for the year of
termination shall be awarded which match the dollar value pro-rata amount of
annual incentive compensation payable pursuant to
Section 7(e)(iii) above and such PERS awards together with all
outstanding PERS awards, restricted stock, deferred stock awards and other
long-term incentive awards (to the extent then or previously earned, or earned
as a result of this Section) 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 

 

15

 

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, 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 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. For so long as Executive shall participate in the Company
plans and programs referred to in this Section 7(e)(viii), Executive shall
receive cash payments equal on an after-tax basis to his cost for participating
in such plans and programs, with such payments to be made by the Company to
Executive on a monthly basis and in accordance with Section 7(g) of
this Agreement.  If or when 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) that 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
during such period and in accordance with Section 7(g) of this
Agreement (it being understood that the Company payments to Executive
attributable to these benefits will be equal on an after-tax basis to the full
monthly premium cost to Executive to purchase such benefits independently, and
shall not be limited to the value of the Company contribution, if any, to the
cost of an employee’s coverage under any such medical, disability or life
benefits plan, but shall not exceed the highest risk premium charged by a
carrier having an investment grade or better credit rating). Notwithstanding
the foregoing, 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. Notwithstanding the foregoing, nothing in this
Section 7(e)(viii) shall alter any right Executive may have to participate
in any Company medical, disability or life insurance benefits plan or program
that covers former employees of the Company in accordance with the generally
applicable terms of such plan or program nor shall it alter Executive’s right
to health coverage as provided by Section 5(b) of this Agreement.

 

(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 (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

 

16

 

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 and stock appreciation rights 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 or stock appreciation rights
granted on or after the Effective Date shall remain outstanding and exercisable
until the stated expiration date of the option or stock appreciation right as
though Executive’s employment did not terminate, and, in other respects, such
options and stock appreciation rights shall be governed by the plans and
programs and the agreements and other documents pursuant to which such options
and stock appreciation rights were granted;

 

(v)           The
performance period under any long-term incentive plan pursuant to which equity
or other awards have been granted shall be treated as satisfied and any
performance objectives upon which the earning of performance-based restricted
stock and deferred stock awards and other long-term incentive awards is
conditioned shall be deemed to have been met at target level at the date of
termination.  PERS for the year of
termination shall be awarded which match the dollar value pro-rata amount of
annual incentive compensation payable pursuant to Section 7(f)(iii) above
and such PERS awards together with all outstanding PERS awards, restricted
stock, deferred stock awards and other long-term incentive awards (to the
extent then or previously earned, or earned as a result of this Section) 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, 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 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. For so long as Executive shall participate in the Company
plans and programs referred to in this 

 

17

 

Section 7(f)(viii), Executive shall
receive cash payments equal on an after-tax basis to his cost for participating
in such plans and programs, with such payments to be made by the Company to
Executive on a monthly basis and in accordance with Section 7(g) of
this Agreement.  If or when 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 instead be paid
cash payments equivalent on an after-tax basis to the value of the additional
benefits described in this Section 7(f)(viii) that 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 during such period and in accordance with Section 7(g) of
this Agreement (it being understood that the Company payments to Executive
attributable to these benefits will be equal on an after-tax basis to the full
monthly premium cost to Executive to purchase such benefits independently, and
shall not be limited to the value of the Company contribution, if any, to the
cost of an employee’s coverage under any such medical, disability or life
benefits plan, but shall not exceed the highest risk premium charged by a
carrier having an investment grade or better credit rating). Notwithstanding
the foregoing, 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. Notwithstanding the
foregoing, nothing in this Section 7(f)(viii) shall alter any right
Executive may have to participate in any Company medical, disability or life
insurance benefits plan or program that covers former employees of the Company
in accordance with the generally applicable terms of such plan or program nor
shall it alter Executive’s right to health coverage as provided by Section 5(b) of
this Agreement.

 

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; Reimbursements; Section 409A
Exemptions; Delayed Payments Under Section 409A.

 

(i) 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).

 

(ii) 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.

 

(iii) Any reimbursements made or in-kind benefits provided under
this Agreement shall be subject to the following conditions:

 

(A) the amount of expenses eligible for reimbursement or in-kind
benefits provided in any one taxable year of Executive shall not affect the
amount of expenses eligible for reimbursement or in-kind benefits provided in
any other taxable year of Executive;

 

(B) the reimbursement of any expense shall be made each calendar
quarter and not later than the last day of Executive’s taxable year following
Executive’s taxable year in which the expense was incurred (unless this
Agreement specifically provides for reimbursement by an earlier date);

 

(C) the right to reimbursement of an expense or payment of an
in-kind benefit shall not be subject to liquidation or exchange for another
benefit.

 

18

 

In addition, with respect to any
reimbursement made under Sections 5(b), 6(c)(vi), 7(c)(viii), 7(d)(viii),
7(e)(viii) and 7(f)(viii) for expenses for medical coverage purchased
by Executive, any such reimbursements made during the period of time Executive
would be entitled (or would, but for such reimbursement, be entitled) to
continuation coverage under the Company Health Plan pursuant to COBRA if
Executive had elected such coverage and paid the applicable premiums shall be
exempt from Section 409A of the Code and the six-month delay in payment
described hereinbelow pursuant to Section 1.409A-1(b)(9)(v)(B) of the
Regulations.

 

(iv) Executive’s right to reimbursements
under this Agreement shall be treated as a right to a series of separate
payments under Section 1.409A-2(b)(2)(iii) of the Regulations.

 

(v) It is intended that payments made
under this Agreement due to Executive’s termination of employment which are
paid on or before the 15th day of the third month following the end
of Executive’s taxable year in which his termination of employment occurs shall
be exempt from compliance with Section 409A of the Code pursuant to the
exemption for short-term deferrals set forth in
Section 1.409A-1(b)(4) of the Regulations.

 

(vi) 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 or reimbursement due within such six-month period shall be
delayed to the end of such six-month period. The Company will adjust the payment
or reimbursement to reflect the deferred payment date by multiplying the
payment or reimbursement 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 or reimbursement would have been made but for the delay (or the
most appropriate surrogate for such rate if such rate is not available)
multiplied by a fraction, the numerator of which is the number of days by which
such payment or reimbursement was delayed and the denominator of which is
365.  In the event of a reimbursement
that is required by other terms of this Agreement to be made on an after-tax
basis and which is subject to the six-month delay provided herein, the reimbursement
as adjusted in accordance with this Section 7(g) to reflect the
deferred payment date shall be paid to Executive on an after-tax and fully
grossed-up basis so that Executive is held economically harmless. The Company
will pay the adjusted payment or reimbursement 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.

 

(vii)
Any payments to Executive in accordance with Sections 7(c) or 7(d) of this
Agreement following the occurrence of a Potential Change in Control but prior
to the Change in Control contemplated by such Potential Change in Control and
any remaining payments to Executive in accordance with Sections 7(e) or 7(f) of
this Agreement, respectively, following such Change in Control which are made
as a result of the last sentence of  Section 2 of this Agreement shall be
deemed a single payment made upon Executive’s termination of employment for
purposes of compliance with the permissible payment rules of Treasury
Regulations Section 1.409A-3, but
if such payments shall not qualify as a single payment made upon Executive’s
termination of employment under the permissible payment rules of Treasury
Regulations Section 1.409A-3, then the payments to be made under Sections 7(e)
or 7(f) of this Agreement shall be made upon the earlier of a change in control of
the Company within the meaning provided by Treasury Regulations Section
1.409A-3(i)(5) or 12 months after Executive’s termination of employment.

 

8.             Definitions Relating to Termination Events.

 

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

 

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

 

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

 

19

 

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

 

(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;

 

20

 

(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 in accordance with Section 7(g) with
such reimbursements to be made on a fully grossed-up and after-tax basis if
Executive is subject to Federal, state or local income tax on such reimbursements
so that Executive is held economically harmless.

 

(d)           “Disability.”  For purposes of this Agreement, “Disability”
means that Executive has been determined to be disabled in accordance with the
Company’s long-term disability plan by reason of any medically determinable
physical or mental impairment that can be expected to result in death or can be
expected to last for a continuous period of not less than 12 months and
Executive has received at least three months of benefits under the Company’s short-term
disability and/or the long-term disability plan.

 

(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;

 

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

 

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

 

21

 

(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.

 

Notwithstanding the foregoing,
if Executive terminates his employment after a Potential Change in Control but
prior to the Change in Control contemplated by such Potential Change in Control,
a determination as to whether Executive will be deemed to have terminated his
employment for Good Reason upon such Change in Control as provided in
Section 2 of this Agreement will be made by substituting “Potential Change
in Control” for “Change in Control” each place it appears in Sections
8(e)(ii) and (v) above.

 

Notwithstanding the foregoing
provisions of this Section 8(e), and solely for purposes of the payment of
restricted stock units, stock appreciation rights, PERS and other equity-based
awards that are potentially subject to Section 409A of the Code and which
become payable as a result of Executive’s termination of employment for “Good
Reason” prior to or more than two years after a Change in Control under
Section 7(d)(v) of this Agreement and not for any other purpose (it
being understood that such awards are automatically accelerated upon a Change
in Control pursuant to Section 5(c) of this Agreement), the following
definition of Good Reason shall apply in lieu of the foregoing definition:

 

“Good Reason” shall mean, without Executive’s
express written consent, the occurrence of any of the following circumstances
provided that Executive shall have given notice of such circumstance(s) to
the Company within a period not to exceed 90 days of the initial existence of
such circumstance(s) and the Company shall not have remedied such
circumstance(s) within 30 days after receipt of such notice:

 

(A)                            the
assignment to Executive of duties materially inconsistent with Executive’s
position and status hereunder, or an alteration, materially 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)(A) 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;

 

22

 

(B)                              (I) a
material reduction by the Company in Executive’s Base Salary, (II) the
setting of Executive’s annual target incentive opportunity or payment of earned
annual incentive in amounts materially less than specified under or otherwise
not in material conformity with Section 4 hereof, or (III) a material
change in compensation or benefits not in material conformity with
Section 5;

 

(C)                              the
relocation of the principal place of Executive’s employment not in material
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;

 

(D)                             the
failure by the Company to pay to Executive any material portion of Executive’s
compensation or to pay to Executive any material portion of an installment of
deferred compensation under any deferred compensation program of the Company
within a reasonable time after such compensation is due;

 

(E)                               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;

 

(F)                               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; or

 

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

 

provided, however, that a forfeiture under Section 10(f) shall
not constitute “Good Reason.”

 

(f)            “Potential
Change in Control”  For purposes of
this Agreement, a “Potential 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, at a time when any stock of the Company is publicly
traded on an established securities market or otherwise, 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) 

 

23

 

of the Code for such calendar year. The 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)(6).

 

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), and potential obligations under the last sentence of Section 2 of this
Agreement. 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 ownership or control
(whether or not such amounts are payable pursuant to this Agreement) (the
“Change in Control Payments”), if any of such Change in Control Payments are
subject to the tax (the “Excise Tax”) imposed by Section 4999 of the Code
(or any similar federal, state or local tax that may hereafter be imposed), 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 payments provided for by Section 9(b), shall be equal to the
Total Payments.

 

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

 

(A)          any
payments or benefits received or to be received by Executive in connection with
a Change in Control or other change in ownership or 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 Change in Control 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.

 

24

 

(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 in the calendar year in which the Gross-Up Payment is to be made, net
of the maximum reduction in federal income taxes which could actually be
obtained from deduction of such state and local taxes by Executive.  In the event that the Excise Tax is
subsequently determined to be less than the amount taken into account and paid
to Executive hereunder, Executive shall file for a refund of such excess Excise
Tax.  Executive shall repay to the
Company the excess Excise Tax amount actually refunded to Executive by the
Internal Revenue Service within ten business days after the later of
(A) the date that the Internal Revenue Service makes a final determination
(within the meaning of Section 1313 of the Code) that an overpayment of
such Excise Tax was made (and including a final determination of the amount
thereof) and (B) the actual receipt of the refund check from the Internal
Revenue Service for the amount of such overpayment of Excise Tax by Executive;
provided, however, if no refund shall be due to Executive because such
overpayment of the Excise Tax has been applied to satisfy Executive’s other tax
liabilities, Executive shall notify the Company of such application of the
overpayment to Executive’s other tax liabilities and shall pay to the Company
within ten business days after such application of the overpayment to
Executive’s other tax liabilities the amount of the Excise Tax that would
otherwise have been refunded. In the event that the Excise Tax is determined to
exceed the amount taken into account and paid hereunder, the Company shall make
an additional Gross-Up Payment in respect of such excess within ten business
days after the time that the amount of such excess is determined but in no
event later than 30 days after the Change in Control.  In no event shall any Gross-Up Payment be
made under this Section 9(b) later than the last day of Executive’s
taxable year next following Executive’s taxable year in which Executive remits
the Excise Tax.  Anything in this
Section 9(b) to the contrary notwithstanding, any Gross-Up Payment to
be made hereunder shall be subject to such delay in payment as may apply under
Section 7(g) of this Agreement (including but not limited to
Section 7(g)(vi)) in the event that such payment is made in connection
with Executive’s termination of employment and is subject to Section 409A
of the Code.

 

(iii)                             The Gross-Up Payment provided for in this Section 9(b) shall
be made at the same time as any payments giving rise to an Excise Tax are made;
provided, however, that if the amount of such Gross-Up Payment cannot be
finally determined at the same time as the payments giving rise to an Excise
Tax are made, the Company shall pay to Executive at the time the
payments giving rise to an Excise Tax are made an estimate, as determined in good faith by the Company pursuant to Section 9(b)(iv) hereof,
of the amount of such Gross-Up Payment and shall pay the remainder of such
Gross-Up Payment at the time
provided in Section 9(b)(ii) above. 
Executive’s right to payments under this Section 9(b) shall be
treated as a right to a series of separate payments under Section 1.409A-2(b)(2)(iii) of
the Regulations.

 

(iv)                              All determinations under this Section 9(b) shall be made by the
Company at its expense using 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 

 

25

 

affiliates with
whom Executive has had contacts or relationships, directly or indirectly,
during and within the scope of his employment with the Company or any of its
affiliates, to curtail or cancel their business with the Company or any such
affiliate; (iii) induce, or attempt to influence, any employee of the
Company or any of its affiliates to terminate employment; or (iv) solicit,
hire or retain as an employee or independent contractor, or assist any third
party in the solicitation, hire, or retention as an employee or independent
contractor, any person who during the previous 12 months was an employee of the
Company or any affiliate; provided, however, that the limitation
contained in clause (i) above shall not apply if Executive’s employment is
terminated as a result of a termination by the Company without Cause within two
years following a Change in Control or is terminated by Executive for Good
Reason within two years following a Change in Control, and provided further,
that activities engaged in by or on behalf of the Company are not restricted by
this covenant. The provisions of subparagraphs (i), (ii), (iii), and (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 Executive, on an after-tax basis each calendar
quarter, for all expenses actually incurred in connection with his provision of
testimony or assistance in accordance with the provisions of Section 7(g) of
this Agreement but not later than the last day of the year in which the expense
was incurred.

 

(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 substantially the form set
forth in Attachment A to this Agreement, releasing any and all claims arising
out of Executive’s employment other than enforcement of this Agreement and
other than with respect to vested rights or rights provided for under any
equity plan, any compensation plan or any benefit plan or arrangement of the
Company or rights to indemnification under any agreement, law, Company
organizational

 

26

 

document or policy, or otherwise. 
The Company will provide Executive with a copy of such release
simultaneously with or as soon as administratively practicable following the
delivery of the notice of termination provided in Sections 6 and 7 of this
Agreement, but not later than 21 days before (45 days before if Executive’s
termination is part of an exit incentive or other employment termination
program offered to a group or class of employees) Executive’s termination of
employment.  Executive shall deliver the
executed release to the Company eight days before the date provided in Section 7(g) of
this Agreement for the payment of the termination payments and benefits payable
under Sections 6 and 7 of this Agreement.

 

(f)        Forfeiture of Outstanding Options.  The provisions of Sections 6 and 7
notwithstanding, if Executive willfully and materially fails to substantially
comply with any restrictive covenant under this Section 10 or willfully
and materially fails to substantially comply with any material obligation under
this Agreement, all options to purchase Common Stock granted by the Company and
then held by Executive or a transferee of Executive shall be immediately
forfeited and thereupon such options shall be cancelled. Notwithstanding the
foregoing, Executive shall not forfeit any option unless and until there shall
have been delivered to him, within six months after the Board (i) had
knowledge of conduct or an event allegedly constituting grounds for such
forfeiture and (ii) had reason to believe that such conduct or event could
be grounds for such forfeiture, a copy of a resolution duly adopted by a
majority affirmative vote of the membership of the Board (excluding Executive)
at a meeting of the Board called and held for such purpose (after giving
Executive reasonable 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.  All references to sections
of the Exchange Act or the Code shall be deemed also to refer to any successor
provisions to such sections. 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
of this Agreement 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 so as not
to subject Executive to the payment of any tax penalty or interest which may be
imposed by Section 409A of the Code and the Company shall have no right to
accelerate or make any payment under this Agreement except to the extent such
action would not subject Executive to the payment of any tax penalty or
interest under Section 409A of the Code. 
If all or a portion of the benefits and payments provided under this
Agreement constitute taxable income to Executive for any taxable year that is
prior to the taxable year in which such payments and/or benefits are to be paid
to Executive as a result of the Agreement’s failure to comply with the
requirements of Section 409A of the Code and the Regulations, the
applicable payment or 

 

27

 

benefit shall be paid immediately to Executive to the extent such
payment or benefit is required to be included in income.  If Executive becomes subject to any tax
penalty or interest under Section 409A of the Code by reason of this
Agreement, the Company shall reimburse Executive on a fully grossed-up and
after-tax basis for any such tax penalty or interest (so that Executive is held
economically harmless) ten business days prior to the date such tax penalty or
interest is due and payable by Executive to the government.

 

(b)       Reimbursement of Expenses in Enforcing
Rights.  The Company shall promptly pay or reimburse all
reasonable costs and expenses (including fees and disbursements of counsel and
pension experts) incurred by Executive in seeking to interpret this Agreement
or enforce rights pursuant to this Agreement or in any proceeding in connection
therewith brought by Executive, whether or not Executive 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 on an after-tax basis
each calendar quarter for all costs and expenses actually incurred as provided
in this Section 11(b) and in accordance with the provisions of Section 7(g) of
this Agreement, but not later than the last day of the year in which the
expense was incurred.

 

(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) 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 each calendar quarter in accordance with the
provisions of Section 7(g) of this Agreement, but not later than the
last day of the year in which the expense was incurred. Notwithstanding
any provision in this Section 11, Executive shall be paid and 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(c), 5(h) and 7(g) of this Agreement
(concerning interest payable with respect to certain delayed payments that are
subject to Section 409A of the Code).

 

12.               Miscellaneous.

 

(a)       Integration. During the Term of
this Agreement, 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, plans or arrangements relating to compensation, equity or benefits
under executive compensation, equity or benefit plans of the Company and its
subsidiaries. Notwithstanding the foregoing, 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 provision, 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
provision, right or benefit is more favorable to Executive than a corresponding
provision, right or benefit under this Agreement (or if there is no
corresponding 

 

28

 

provision, right
or benefit under this Agreement).  If a
provision, right or benefit under a Change-in-Control Agreement is more
favorable to Executive than a corresponding provision, right or benefit under
this Agreement (or if there is no corresponding provision, right or benefit
under this Agreement), such provision, right or benefit shall be deemed
included in this Agreement without any requirement to give effect to the
entirety of the Change-in-Control Agreement from which such provision, right or
benefit arose.  Notwithstanding the
foregoing, no payment or benefit under a Change-in-Control Agreement shall be
made or extended which duplicates any payment or benefit hereunder. This
Agreement constitutes the entire agreement among the parties with respect to
the matters herein provided, and no modification or waiver of any provision
hereof shall be effective unless in writing and signed by the parties hereto.
Executive shall not be entitled to any payment or benefit under this Agreement
which duplicates a payment or benefit received or receivable by Executive under
any prior agreements and understandings or under any benefit or compensation
plan of the Company which are in effect.

 

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

 

As used in this Agreement,
“Company” shall mean IMS Health Incorporated or any wholly owned subsidiary of
IMS Health Incorporated domiciled in the United Kingdom to which IMS Health
Incorporated may assign its rights and obligations hereunder, provided that the
performance of all such obligations hereunder by such subsidiary shall be
guaranteed by IMS Health Incorporated, and references to plans and programs
shall refer to those of IMS Health Incorporated and its subsidiaries.  In addition, the term “Company” or “IMS
Health Incorporated” shall include any successor to the business and/or assets
of IMS Health Incorporated which assumes and agrees to perform this Agreement
by operation of law, or otherwise and, in the case of an acquisition of the
Company in which the corporate existence of the Company continues, the ultimate
parent company following such acquisition. 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(c), or by the Company except to
a successor as defined in this 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

  
	
   

  	
  901
  Main Avenue, Suite 612

  
	
   

  	
  Norwalk,
  CT 06851

  
	
   

  	
   

  
	
   

  	
  Attention: Chief
  Executive Officer

  
	
   

  	
   

  
	
   

  	
  If to Executive:

  
	
   

  	
   

  
	
   

  	
  M. Gilles Pajot

  
	
   

  	
   

  
	
   

  	
  c/o Monica
  Kurnatowska

  
	
   

  	
  Baker &
  McKenzie LLP

  
	
   

  	
  100 New Bridge
  Street

  
	
   

  	
  London EC4V 6JA

  

 

29

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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 on a fully grossed-up and after-tax basis 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) which determination shall be subject to
arbitration in accordance with Section 11(c) of this Agreement. The standard for indemnification or advancement of
costs and expenses incurred by Executive in seeking to interpret this Agreement
or enforce rights pursuant to this Agreement or in any proceeding in connection
therewith shall be governed by Section 11(b) of this Agreement.
After the date hereof, the Company shall not amend its Certificate of 

 

30

 

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 date of execution of this Agreement.

 

IN WITNESS
WHEREOF, Executive has hereunto set his hand and the Company has caused this
instrument to be duly executed this 24th day of October, 2008.

 

	
   

  	
  IMS HEALTH
  INCORPORATED

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David R.
  Carlucci

  
	
   

  	
  David R.
  Carlucci

  
	
   

  	
  Chairman of the
  Board, Chief Executive Officer and President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Gilles Pajot

  
	
   

  	
  Gilles Pajot

  

 

31

 

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.

 

“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.

 

32

 

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 an amount equal to
$368,913 increased by interest compounded at a rate of 5.5% per annum from
February, 1998 to the month in which payment of the Supplemental Benefit shall be
made to Executive as provided in Article III; 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 an amount equal to $368,913 increased by interest compounded
at a rate of 5.5% per annum from February, 1998 to the month in which payment
of the Supplemental Benefit shall be made to Executive as provided in Article III.  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,
2008 (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 Plan had 

 

33

 

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 an amount equal to $368,913 increased by interest
compounded at a rate of 5.5% per annum from February, 1998 to the month in
which payment of the such benefit shall be made to Executive as provided in Article III.

 

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,
2008 (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 unless, in the case of Executive’s termination of employment
for Good Reason within two years after a Change in Control as provided in Section 7(f)(vii),
Executive’s Good Reason is based solely on Good Reason as defined in Section 8(e)(ix).

 

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, 

 

34

 

sale, transfer, assignment,
pledge or encumbrance by Executive, his Beneficiary or any person claiming
under or through Executive or his Beneficiary, nor shall 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 in
accordance with Sections 7(g) and 11(b) of the Employment Agreement,
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.

 

35

 

ATTACHMENT
A

 

RELEASE

 

We advise you to consult an attorney before you sign
this Release. You have until the date which is seven (7) days after the
Release is signed and returned to IMS Health Incorporated to change your mind
and revoke your Release. Your Release shall not become effective or enforceable
until after that date.

 

In consideration for the benefits provided under your
Employment Agreement with IMS Health Incorporated as amended and restated
effective May 7, 2006 (the “Employment Agreement”), and more specifically
enumerated in Exhibit 1 hereto, by your signature below, you, for yourself
and on behalf of your heirs, executors, agents, representatives, successors and
assigns, hereby release and forever discharge the Company, its past and present
parent corporations, subsidiaries, divisions, subdivisions, affiliates and
related companies (collectively, the “Company”) and the Company’s past, present
and future agents, directors, officers, employees, representatives, successors
and assigns (hereinafter “those associated with the Company”) with respect to
any and all claims, demands, actions and liabilities, whether in law or equity,
which you may have against the Company or those associated with the Company of
whatever kind, including but not limited to those arising out of your
employment with the Company or the termination of that employment. You agree
that this release covers, but is not limited to, claims arising under the Age
Discrimination in Employment Act of 1967, 29 U.S.C. § 621 et seq., Title VII of
the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq., the Americans with
Disabilities Act of 1990, 42 U.S.C. § 12101 et seq., the Fair Labor Standards
Act, 29 U.S.C. § 201 et seq., the Employee Retirement Income Security Act of
1974, 29 U.S.C. § 1001 et seq., the Connecticut Fair Employment Practices Act,
C.G.S. § 46a-51 et seq., and any other local, state or federal law, regulation
or order dealing with discrimination in employment on the basis of sex, race,
color, national origin, veteran status, marital status, religion, disability, handicap,
or age. You also agree that this release includes claims based on wrongful
termination of employment, breach of contract (express or implied), tort, or
claims otherwise related to your employment or termination of employment with
the Company and any claim for attorneys’ fees, expenses or costs of litigation.

 

This Release covers all claims based on any facts or
events, whether known or unknown by you, that occurred on or before the date of
this Release. Except to enforce this Release, you agree that you will never
commence, prosecute, or cause to be commenced or prosecuted any lawsuit or
proceeding of any kind against the Company or those associated with the Company
in any forum and agree to withdraw with prejudice all complaints or charges, if
any, that you have filed against the Company or those associated with the
Company.

 

Anything in this Release to the contrary
notwithstanding, this Release does not include a release of (i) your
rights under the Employment Agreement or your right to enforce the Employment
Agreement; (ii) any rights you may have to indemnification or insurance
under any agreement, law, Company organizational document or policy, or
otherwise; (iii) any rights you may have to equity, compensation or
benefits under the Company’s equity, compensation or benefit plans; or (iv) your
right to enforce this Release.

 

By signing this Release, you further agree as follows:

 

You have read this Release carefully and fully
understand its terms;

 

You have had at least twenty-one (21) days to consider
the terms of the Release;

 

You have seven (7) days from the date you sign
this Release to revoke it by written notification to the Company. After this
seven (7) day period, this Release is final and binding and may not be
revoked;

 

You have been advised to seek legal counsel and have
had an opportunity to do so;

 

You would not otherwise be entitled to the benefits
provided under your Employment Agreement had you not agreed to execute this
Release; and

 

1

 

Your agreement to the terms set forth above is
voluntary.

 

 

	
   

  	
  Name:

  	
   

  
	
   

  	
  Signature:

  	
  Date:

  
	
   

  	
  Received
  by:

  	
  Date:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Attachment:  Exhibit 1

  	
   

  

 

2

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