EXHIBIT 10.43
January 15, 2001
Xx. Xxxxxxxx X. Xxxx
IMS HEALTH, President and CEO
000 Xxxxx Xxxxx
Xxxxxxxx, XX 00000
Dear Xxxxxx:
AMENDED AND RESTATED FIRST AMENDMENT dated as of the 15th day of
January, 2001 to the Employment Agreement effective July 1, 1998 (as Amended and
Restated as of January 1, 2000) by and between Xxxxxxxx X. Xxxx (the
"Executive") and IMS Health Incorporated (the "Company") (the "Agreement").
W I T N E S S E T H:
WHEREAS, the Executive and the Company entered into the Agreement;
and
WHEREAS, the Executive has a medical condition requiring surgery
that may disable her thereafter for a substantial period; and
WHEREAS, in order to provide for an orderly transfer of authority
and to also have the benefit of the Executive's experience and knowledge for a
transitional period, the Company on November 14, 2000 entered into a First
Amendment to the Agreement (the "First Amendment") pursuant to which, among
other things, the Executive ceased to be President and Chief Executive Officer
of the Company but became Vice Chairman of the
Board and the Company and the Executive agreed to various changes in the
compensation provisions of the Agreement; and
WHEREAS, the Executive and the Company now wish for the Executive's
employment with the Company and membership on the Board to end; and
WHEREAS, the Executive and the Company therefore desire to amend and
restate the First Amendment.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements of the parties set forth in the Agreement and this
Amended and Restated First Amendment, and of other good and valuable
consideration, the adequacy and receipt of which is acknowledged, the parties
hereto hereby amend and restate the substance of the First Amendment to read in
its entirety as follows:
1. All terms used herein, except as otherwise specifically
defined herein, shall have the same meaning as in the Agreement.
2. Section 2 of the Agreement is amended by the addition of
the following sentence at the end thereof, to read as follows:
"Notwithstanding the foregoing, the Executive's employment with the
Company shall end at 11:59 p.m., New York City time, on January 15,
2001 (the "Final Employment Time")."
3. Section 3(a) of the Agreement is amended by the
addition of the following sentences at the end thereof, to read
as follows:
"Notwithstanding the foregoing, effective on the Change Date, as
defined below, the Executive shall cease to be President and Chief
Executive Officer of the Company and then, until the Final
Employment Time, at the discretion of the Board, the Executive shall
serve as Vice Chairman of the Board or as an untitled executive
reporting to the Chairman, provided that if the Medical Date, as
defined below, occurs on or after the Change Date, the Executive
shall thereafter be on disability leave (except for providing such
advice and guidance as she is physically capable of providing in her
judgment). During the period until the Final Employment Time, in
whatever capacity or while on disability leave, the Executive shall
be treated for all compensation and benefit purposes the same as if
she still
retained her title and position of President and Chief Executive
Officer and worked full time. At the Final Employment Time, the
Executive shall cease to be Vice Chairman of the Board, shall cease
to hold any other position she may hold within the Company and shall
resign as a member of the Board. "Change Date" shall be the earlier
of (i) such date as the Company appoints a new Chief Executive
Officer or (ii) the Medical Date. "Medical Date" shall be such date
as the Executive in good faith after consultation with her doctors
determines it is either (x) desirable to have the necessary surgery
promptly or (y) she is unable for physical reasons to work in her
executive capacities and the Executive so notifies the Company."
4. Section 6 of the Agreement is amended by the addition of
the following subsection at the end thereof, to read as follows:
"(e) Special Retirement. Notwithstanding anything else herein to
the contrary, the parties agree that the Executive's termination as
an employee as provided in Section 2 hereof shall be a Special
Retirement and the Executive shall be treated the same as for a
Disability Termination under Section 6(c) hereof except as follows:
(A) The pro rata annual incentive compensation under Section
4(b) for the fiscal year 2001 shall be based on the
greater of the actual performance incentive bonus for
1999, the targeted performance incentive bonus for 2000,
or the actual performance incentive bonus for 2000.
(B) The Company shall, within 5 business days after the
Final Employment Time, pay the Executive $872,536
(I.E., an amount equal to the aggregate amount of
incentive compensation due to the Executive under
Section 4(b) for fiscal years 2000 and 2001 assuming
that the actual performance incentive bonus for 2000
turns out to equal the targeted incentive bonus for
2000). As soon as the Company determines the exact
aggregate amount of incentive compensation due to the
Executive under Section 4(b) for fiscal years 2000
and 2001, the Company shall notify the Executive of
that amount, separately calculated for fiscal years
2000 and 2001. If that amount is more than the
$872,536 amount that the Company paid to the
Executive pursuant to the second preceding sentence,
the Company will pay the difference to the Executive,
and if
that amount is less than the $872,536 amount that the
Company paid to the Executive pursuant to the second
preceding sentence, the Executive will reimburse the
Company for the difference, in each case without
interest and in each case within 5 business days after
the Company delivers the notice referred to in the
preceding sentence.
(C) All stock options granted under the IMS Health
Incorporated 1998 Employee Stock Incentive Plan
(excluding all replacement options) and other equity
grants held by the Executive shall fully vest as of
the Change Date, with the exception of the August 23,
2000 stock option grant which shall vest as provided
in the original grant. All options referenced in
this subsection shall be exercisable until the end of
the respective option terms provided in the original
grants and the options awarded in the August 23, 2000
grant shall be exercisable in accordance with the
terms of that grant.
(D) The Executive's obligations with respect to the loan
described in Section 5(g) of the Agreement (principal
and interest) shall be forgiven as of the Change
Date, and the Company shall pay the Executive (or
deposit with the appropriate taxing authorities) on
the Change Date an additional amount to cover the
Executive's income tax liability for the forgiveness
of such indebtedness and in such amount that the
Executive will have no after tax cost with regard to
the forgiveness of the loan and such payment and all
documents with regard to such loan shall be deemed
amended accordingly.
(E) Executive shall be treated as of the Final Employment
Time under the Company's Supplemental Executive
Retirement Plan ("SERP"), notwithstanding the terms
thereof, as if she were eligible for "Retirement"
thereunder, shall be credited with fifteen (15) years
of service thereunder, shall be entitled to immediate
commencement of benefits thereunder, and "Average
Final Compensation" shall be deemed to mean the sum
of her base salary as of June 1, 2000 and the higher
of her annual bonus for the 1999 fiscal year or the
2000 fiscal year. The SERP shall be deemed amended
accordingly as it applies to her.
(F) In addition to such welfare benefits as the Executive
is entitled to under Section 6(c)(vi) of the
Agreement for the period before the Executive reaches
age 65, the Executive shall be entitled to retiree
health benefits after age 65 in accordance with the
Company's retiree health plans as in effect on June
1, 2000. In addition, the Company agrees, at its
sole cost and expense, to provide the Executive after
the Final Employment Time with medical and dental
coverage that shall be comparable to the medical and
dental coverage in effect on June 1, 2000 under the
Company's retiree health benefits plan pursuant to
such insured or other arrangements as the Company may
from time to time put into effect for such purpose.
Any such insured or other arrangement shall not
impose on the Executive any eligibility waiting
period or pre-existing condition exclusion.
(G) During the five (5) year period following such
termination of employment, the Company shall make
available to the Executive secretarial and
administrative support services.
(H) In accordance with standard Company practice, the
Company agrees that it will, at its sole cost and
expense, repatriate the Executive's household goods from
London, England to a place in the United States of the
Executive's choosing.
(I) The Company shall, in addition to its other obligations
under this Agreement, pay $2,884,852 to the Executive
within 5 business days after the Final Employment Time.
5. As amended herein, the Agreement shall remain in full force
and effect.
IN WITNESS WHEREOF, the Executive and the Company have executed this
Amended and Restated First Amendment as of the day and year first above written.
/s/ Xxxxxxxx X. Xxxx
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Xxxxxxxx X. Xxxx
IMS Health Incorporated
By: /s/ Xxxxxx X. Xxxxxxxxx
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Name: Xxxxxx X. Xxxxxxxxx
Title: Senior Vice President and General Counsel
