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Exhibit 10.1
IMS HEALTH INCORPORATED
U.S. EXECUTIVE RETIREMENT PLAN
Effective as of July 25, 2000
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TABLE OF CONTENTS
PAGE
INTRODUCTION...................................................................1
SECTION 1 - DEFINITIONS................................................1
1.1 "Actuarial Equivalent Value".................................1
1.2 "Affiliated Employer"........................................1
1.3 "Average Final Compensation".................................1
1.4 "Basic Disability Plan"......................................2
1.5 "Basic Disability Plan Benefit"..............................2
1.6 "Basic Plan".................................................2
1.7 "Basic Plan Benefit".........................................2
1.8 "Board"
1.9 "Change in Control"..........................................3
1.10 "Code" ....................................................4
1.11 "Company"....................................................5
1.12 "Compensation"...............................................5
1.13 "Covered Earnings"...........................................5
1.14 "Deferred Vested Benefit"....................................5
1.15 "Disability"or "Disabled"....................................5
1.16 "Disability Benefits"........................................5
1.17 "Effective Date".............................................6
1.18 "Former Member"..............................................6
1.19 "Lump Sum Election"..........................................6
1.20 "Member" 6
1.21 "Other Disability Income"....................................6
1.22 "Other Retirement Income"....................................6
1.23 "Plan" ....................................................7
1.24 "Retirement".................................................7
1.25 "Retirement Benefits"........................................7
1.26 "Service"....................................................7
1.27 "Surviving Spouse"...........................................8
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TABLE OF CONTENTS
(CONTINUED)
PAGE
1.28 "Surviving Spouse's Benefits"................................8
1.29 "Vested Former Member".......................................9
1.30 "Plan Administrator".........................................9
SECTION 2 - PARTICIPATION..............................................9
2.1 Commencement of Participation................................9
2.2 Termination of Participation.................................9
SECTION 3 - AMOUNT AND FORM OF BENEFITS...............................10
3.1 Retirement Benefits.........................................10
3.2 Deferred Vested Benefit.....................................11
3.3 Form of Payment.............................................13
3.4 Lump Sum Election...........................................15
3.5 Cessation of Benefits.......................................16
3.6 Notification of Cessation of Benefits.......................18
3.7 Repayment of Benefits Paid as Lump Sum......................18
3.8 Change in Control...........................................19
SECTION 4 - DISABILITY BENEFITS.......................................19
4.1 Disability Benefits.........................................19
(a) Eligibility........................................19
(b) Amount.............................................19
SECTION 5 - SURVIVING SPOUSE'S BENEFITS...............................19
5.1 Death Prior to Benefit Commencement.........................19
5.2 Death On or After Benefit Commencement......................20
5.3 Commencement of Surviving Spouse's Benefit..................20
5.4 Lump Sum Payment............................................20
5.5 Reduction...................................................21
SECTION 6 - PLAN ADMINISTRATOR........................................22
6.1 Duties and Authority........................................22
SECTION 7 - MISCELLANEOUS.............................................22
7.1 Amendment; Termination......................................22
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TABLE OF CONTENTS
(CONTINUED)
PAGE
7.2 No Employment Rights........................................23
7.3 Payout in Discretion of the Plan Administrator..............23
7.4 Unfunded Status.............................................24
7.5 Arbitration.................................................24
7.6 No Alienation...............................................24
7.7 Withholding.................................................25
7.8 Governing Law...............................................25
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IMS HEALTH INCORPORATED
U.S. EXECUTIVE RETIREMENT PLAN
Effective as of July 25, 2000
INTRODUCTION
Effective as of July 25, 2000, the IMS Health Incorporated U.S. Executive
Retirement Plan (the "Plan") is established to provide a means of ensuring the
payment of a competitive level of retirement income and disability and survivor
benefits, and thereby attract, retain and motivate a select group of executives
of IMS Health Incorporated and its affiliated employers.
SECTION 1 - DEFINITIONS
1.1 "ACTUARIAL EQUIVALENT VALUE" shall mean a benefit of equivalent value
computed on the basis of the 1983 Group Annuity Mortality Table and
interest equal to the yield on 30-year Treasury Bonds as of the last
business day of the Plan Year prior to the year in which the relevant
calculation occurs.
1.2 "AFFILIATED EMPLOYER" shall mean an entity affiliated with the Company.
1.3 "AVERAGE FINAL COMPENSATION" shall mean a Member's average annual
Compensation during the five consecutive 12-month periods in the last
ten consecutive 12-month periods of his or her Service (or during the
total number of consecutive 12-month periods if fewer than five),
immediately prior to the month following the Member's termination of
employment with the Company or an Affiliated Employer or, if earlier,
removal from
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participation under this Plan, affording the highest such Average Final
Compensation. If actual monthly Compensation for any month during the
120-month computational period is unavailable, Compensation for such
month shall be determined by dividing the Member's annual rate of base
pay in the month preceding such unavailable month by 12.
1.4 "BASIC DISABILITY PLAN" shall mean as to any Member the long-term
disability plan of the Company or an Affiliated Employer pursuant to
which long-term disability benefits are payable to such Member.
1.5 "BASIC DISABILITY PLAN BENEFIT" shall mean the amount of benefits
payable to a Member from the Basic Disability Plan.
1.6 "BASIC PLAN" shall mean as to any Member or Vested Former Member the
defined benefit pension plan of the Company or an Affiliated Employer
intended to meet the requirements of Code Section 401(a) pursuant to
which retirement benefits are payable to such Member or Vested Former
Member or to the Surviving Spouse or designated beneficiary of a
deceased Member or Vested Former Member.
1.7 "BASIC PLAN BENEFIT" shall mean the amount of benefits payable from the
Basic Plan to a Member or Vested Former Member.
1.8 "BOARD" shall mean the Board of Directors of IMS Health Incorporated,
except that any action authorized to be taken by the Board hereunder
may also be taken by a duly authorized committee of the Board or its
duly authorized delegees.
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1.9 "CHANGE IN CONTROL" shall mean:
(a) any "Person" as such term is used in Sections 13(d) and 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 corporation owned, directly or indirectly,
by the stockholders of the Company), becomes the "Beneficial
Owner" (as defined in Rule 13d-3 of 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;
(b) during any period of 24 months (not including any period prior
to the Effective Date), individuals who at the beginning of
such period constitute the Board, and any new director (other
than (i) a director nominated by a Person who has entered into
an agreement with the Company to effect a transaction
described in Sections 1.9(a), (c), or (d) hereof, (ii) 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 (iii) 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
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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;
(c) 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 (i) 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 (ii) 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;
(d) 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
(e) the Board adopts a resolution to the effect that, for purposes
of this Plan, a Change in Control has occurred.
1.10 "CODE" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
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1.11 "COMPANY" shall mean IMS Health Incorporated.
1.12 "COMPENSATION" shall mean base salary, annual bonuses, commissions,
overtime and shift pay, in each case prior to reductions for elective
contributions under Sections 401(k) and 125 of the Code and deferred
compensation under any nonqualified deferred compensation plan.
Notwithstanding the foregoing, Compensation shall exclude severance pay
(including, without limitation, severance pay under the Company's
Employee Protection Plan), stay-on bonuses, long-term bonuses,
retirement income, change-in-control payments, contingent payments,
amounts paid under this Plan (other than Disability Benefits) or any
other retirement plan or deferred compensation plan, income derived
from stock options, stock appreciation rights and other equity-based
compensation and other forms of special remuneration.
1.13 "COVERED EARNINGS" shall mean a Member's Compensation in the 12 months
immediately preceding the onset of the Member's Disability.
1.14 "DEFERRED VESTED BENEFIT" shall mean the benefits described in Section
3.2(b) hereof.
1.15 "DISABILITY" OR "DISABLED" shall mean disability or disabled for
purposes of the Basic Disability Plan.
1.16 "DISABILITY BENEFITS" shall mean the benefits provided as described in
Section 4.1(b) hereof.
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1.17 "EFFECTIVE DATE" shall mean July 25, 2000.
1.18 "FORMER MEMBER" shall mean (i) a Member whose employment with the
Company or an Affiliated Employer terminates with a Vested Percentage
equal to 0%, or (ii) a Member who was removed from participation in the
Plan, in accordance with Section 2.2 hereof, with a Vested Percentage
equal to 0%.
1.19 "LUMP SUM ELECTION" shall mean an election to receive all or portion of
the benefits payable hereunder in a lump sum pursuant to Section 3.4
hereof.
1.20 "MEMBER" shall mean an employee of the Company or an Affiliated
Employer who becomes a participant in the Plan pursuant to Section 2,
but excludes any Former Member or Vested Former Member.
1.21 "OTHER DISABILITY INCOME" shall mean (i) the disability insurance
benefit that the Member is entitled to receive under the Federal Social
Security Act while he or she is receiving the Basic Disability Plan
Benefit and (ii) the disability income payable to a Member from any
supplemental executive disability plan of the Company or any Affiliated
Employer or from any other contract, agreement or other arrangement
with the Company or an Affiliated Employer (excluding any Basic
Disability Plan).
1.22 "OTHER RETIREMENT INCOME" shall mean the retirement income payable to a
Member or Vested Former Member from any `excess benefit plan' as that
term is defined in Section 3(36) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"),
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any plan described in Section 201(2) of ERISA, and any other contract,
agreement or other arrangement providing a defined pension benefit or
defined contribution retirement benefit, in any case, maintained or
entered into with the Company or an Affiliated Employer (excluding this
Plan, any Basic Plan, any defined contribution plan intended to meet
the requirements of Code Section 401(a) and any elective plan of
deferred compensation).
1.23 "PLAN" shall mean the IMS Health Incorporated U.S. Executive Retirement
Plan, as embodied herein, and any amendments thereto.
1.24 "RETIREMENT" shall mean the termination of a Member's or Vested Former
Member's employment with the Company or an Affiliated Employer other
than by reason of death or Disability (i) after reaching age 55,
completing ten years of Service and with a Vested Percentage greater
than 0%, or (ii) immediately following the cessation of the payment of
Disability Benefits under the Plan to such Member or Vested Former
Member while he or she is Disabled. In determining whether age 55 has
been attained under clause (i) of this definition, there shall be
included as years of age the number of additional years credited as
"age" for purposes of the Plan to the Member or Vested Former Member
under a then-effective employment agreement between the Company and
such person.
1.25 "RETIREMENT BENEFITS" shall mean the benefits described in Section
3.1(b) hereof.
1.26 "SERVICE" shall mean a Member's service defined as Vesting Service in
the Basic Plan, which is taken into account for vesting purposes
thereunder (including any such service
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prior to the date such individual becomes a Member but not including
any such service after participation hereunder terminates), except that
(i) Service will also include service while the Member is receiving
Disability Benefits under this Plan; (ii) if a Member was employed by a
company acquired by the Company or an Affiliated Employer after the
Effective Date, such Member's service with that company prior to the
date of acquisition will not constitute Service hereunder; (iii) upon
commencement of participation hereunder in accordance with Section 2.1
hereof, the CEO (as defined in such section) may limit any service
otherwise to constitute Service hereunder with respect to periods prior
to the date of participation in the Plan; and (iv) no service of a
Former Member or Vested Former Member during any period after removal
from participation under Section 2.2 shall constitute Service for
purposes of the Plan. The foregoing notwithstanding, there shall be
included as Service under the Plan the number of additional years (or
other additional period) credited as "service" for purposes of the Plan
to the Member of Former Member or Vested Former Member under an
employment agreement between the Company or an Affiliated Employer and
such person in effect at the time of such person's termination of
employment.
1.27 "SURVIVING SPOUSE" shall mean the spouse of a deceased Member or Vested
Former Member to whom such Member or Vested Former Member is married
under applicable state law immediately preceding such Member or Vested
Former Member's death.
1.28 "SURVIVING SPOUSE'S BENEFITS" shall mean the benefits described in
Section 5 hereof.
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1.29 "VESTED FORMER MEMBER" shall mean (i) a Member whose employment with
the Company or an Affiliated Employer terminates on or after the date
on which his or her Vested Percentage is greater than 0%, or (ii) a
Member who was removed from participation in the Plan, in accordance
with Section 2.2 hereof, on or after the date on which his or her
Vested Percentage is greater than 0%.
1.30 "PLAN ADMINISTRATOR" shall mean the Company, except that any action
authorized to be taken by the Plan Administrator hereunder may also be
taken by any committee or person(s) duly authorized by the Board or the
duly authorized delegees of such duly authorized committee or
person(s).
SECTION 2 - PARTICIPATION
2.1 COMMENCEMENT OF PARTICIPATION. Such key executives of the Corporation
and its Affiliated Employers as are designated by the CEO in writing
and approved by the Plan Administrator shall participate in the Plan as
of a date determined by the CEO.
2.2 TERMINATION OF PARTICIPATION. A Member's participation in the Plan
shall terminate upon termination of his or her employment with the
Company or any Affiliated Employer. Prior to termination of employment,
a Member may be removed, upon written notice by the CEO as approved by
the Plan Administrator, from further participation in the Plan. As of
the date of termination or removal, no further benefits shall accrue to
such individual hereunder.
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SECTION 3 - AMOUNT AND FORM OF BENEFITS
3.1 RETIREMENT BENEFITS.
(a) ELIGIBILITY. Upon the Retirement of a Member or Vested Former
Member from the Company or an Affiliated Employer, he or she
shall be entitled to receive a percentage (the "Vested
Percentage") of the Retirement Benefit described in Section
3.1(b) hereof, payable in the form specified in Section 3.3.
Notwithstanding the provisions of Section 1.26 of the Plan to
the contrary, solely for the purpose of determining the Vested
Percentage under the following schedule, Service shall exclude
any such service prior to the date the individual becomes a
Member, except to the extent otherwise determined by the Chief
Executive Officer of the Company, in his or her sole
discretion.
<TABLE>
<CAPTION>
If the Member's Service is: The Vested Percentage is:
--------------------------- -------------------------
<S> <C>
Less than 1 year 0%
At least 1 but less than 2 years 33%
At least 2 but less than 3 years 67%
3 or more years 100%
</TABLE>
(b) AMOUNT. The Retirement Benefit of a Member or Vested Former
Member shall be an annual benefit equal to the difference
between (i) and the sum of (ii) and (iii), where:
(i) is 1.67% of his or her Average Final Compensation
multiplied by the number of his or her years of
Service not in excess of 36 years;
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(ii) is the Basic Plan Benefit payable to the Member or
Vested Former Member as of the date of his or her
Retirement expressed in the form of an annual life
annuity, or, if the Basic Plan Benefit becomes
payable after the Member's or Vested Former Member's
Retirement, the Actuarial Equivalent Value as of such
date of the Basic Plan Benefit that would become
payable in the form of an annual life annuity
starting on the earliest possible date under the
terms of the Basic Plan;
(iii) is the Other Retirement Income payable to the Member
or Vested Former Member as of the date of his or her
Retirement expressed in the form of an annual life
annuity, or, if the Other Retirement Income becomes
payable after the Member's or Vested Former Member's
Retirement, the Actuarial Equivalent Value as of such
date of the Other Retirement Income that would become
payable in the form of an annual life annuity
starting on the earliest possible date under the
terms of the appropriate retirement arrangement.
3.2 DEFERRED VESTED BENEFIT.
(a) ELIGIBILITY. Each Member and Vested Former Member who has a
Vested Percentage (as defined below) greater than 0% and whose
employment with the Company or an Affiliated Employer
terminates with the Company's consent, prior to Retirement,
other than by reason of death or Disability, shall be entitled
to receive a percentage (the "Vested Percentage") of the
Deferred Vested Benefit
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described in Section 3.2(b) hereof, payable in the form
specified in Section 3.3. Notwithstanding the provisions of
Section 1.26 of the Plan to the contrary, solely for the
purpose of determining the Vested Percentage under the
following schedule, Service shall exclude any such service
prior to the date the individual becomes a Member, except to
the extent otherwise determined by the Chief Executive Officer
of the Company, in his or her sole discretion.
<TABLE>
<CAPTION>
If the Member's Service is: The Vested Percentage is:
--------------------------- -------------------------
<S> <C>
Less than 1 year 0%
At least 1 but less than 2 years 33%
At least 2 but less than 3 years 67%
3 or more years 100%
</TABLE>
(b) AMOUNT. The Deferred Vested Benefit of a Member or Vested
Former Member who terminates and who meets the eligibility
requirements of Section 3.2(a) shall be an annual benefit
equal to the difference between (i) and the sum of (ii) and
(iii), where:
(i) is 1.67% of his or her Average Final Compensation
multiplied by the number of his or her years of
Service not in excess of 36;
(ii) is the Basic Plan Benefit payable to the Member or
Vested Former Member as of the date his or her
Deferred Vested Benefit commences expressed in the
form of an annual life annuity, or, if the Basic Plan
Benefit becomes payable after the Member's or Vested
Former Member's
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Deferred Vested Benefit commences, the Actuarial
Equivalent Value as of such date of the Basic Plan
Benefit that would become payable in the form of an
annual life annuity starting on the earliest possible
date under the terms of the Basic Plan;
(iii) is the Other Retirement Income payable to the Member
or Vested Former Member as of the date his or her
Deferred Vested Benefit commences expressed in the
form of an annual life annuity, or, if the Other
Retirement Income becomes payable after the Member's
or Vested Former Member's Deferred Vested Benefit
commences, the Actuarial Equivalent Value as of such
date of the Other Retirement Income that would become
payable in the form of an annual life annuity
starting on the earliest possible date under the
terms of the appropriate retirement arrangement.
3.3 FORM OF PAYMENT.
(a) Except as provided under Section 3.3(b) or Section 3.3(c), the
Retirement Benefit or Deferred Vested Benefit under this Plan,
as the case may be, shall be payable in monthly installments
in the form of a straight life annuity and without regard to
any optional form of benefits elected under the Basic Plan.
Payments shall commence on the first day of the calendar month
coinciding with or next following (i) the Member's or Vested
Former Member's Retirement, in the case of Retirement Benefits
or (ii) the later of the date the Member or Vested Former
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Member attains age 55 or terminates employment, in the case of
Deferred Vested Benefits.
(b) If a Member or Vested Former Member has made a Lump Sum
Election pursuant to Section 3.4 and such Lump Sum Election
becomes effective (i) prior to the date of such Member's or
Vested Former Member's Retirement or termination of employment
with the Company or an Affiliated Employer and (ii) while he
or she was still a Member, the Retirement Benefit, or Deferred
Vested Benefit under this Plan, as the case may be, shall be
payable in the form or combination of forms of payment elected
pursuant to such Lump Sum Election under Section 3.4 and
without regard to any optional form of benefits elected under
the Basic Plan. Any portion of the benefits hereunder payable
in a lump sum shall be paid within 60 days following (i) the
Member's or Vested Former Member's Retirement, in the case of
Retirement Benefits or (ii) the later of the date the Member
or Vested Former Member attains age 55 or terminates
employment, in the case of Deferred Vested Benefits.
(c) Notwithstanding any Lump Sum Election made (or not made) under
Section 3.3, if the lump sum value, determined in the same
manner as provided under Section 3.4(a), of a Member's or
Vested Former Member's Retirement, or Deferred Vested Benefit
is $10,000 or less at the time such benefit is payable under
this Plan, such benefit shall be payable as a lump sum.
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3.4 LUMP SUM ELECTION.
(a) A Member or Vested Former Member may elect to receive all,
none, or a specified portion, as provided in Section 3.4(c),
of his or her Retirement Benefit or Deferred Vested Benefit
under the Plan as a lump sum and to receive any balance of
such benefit in the form of an annuity; provided that any such
Lump Sum Election shall be effective for purposes of this Plan
only if the conditions of Section 3.4(b) are satisfied. A
Member or Vested Former Member may elect a payment form
different than the payment form previously elected by him or
her under this Section 3.4(a) by filing a revised election
form; provided that any such new election shall be effective
only if the conditions of Section 3.4(b) are satisfied with
respect to such new election. Any prior Lump Sum Election made
by a Member that has satisfied the conditions of Section
3.4(b) shall remain effective for purposes of the Plan until
such Member has made a new election satisfying the conditions
of Section 3.4(b). The amount of any portion of a Member's or
a Vested Former Member's Retirement Benefit or Deferred Vested
Benefit payable as a lump sum under this Section 3.4 shall
equal the present value of such portion of the benefit, and
such present value shall be determined (i) based on a discount
rate equal to 85% of the average of the 15-year non-callable
U.S. Treasury bond yields as of the close of business on the
last business day of each of the three months immediately
preceding the date the annuity value is determined and (ii)
using the 1983 Group Annuity Mortality Table.
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(b) A Member's Election under Section 3.4(a) becomes effective
only if all of the following conditions are satisfied: (i)
such Member remains in the employment of the Company or an
Affiliated Employer, as the case may be, for the full 12
calendar months immediately following the date of such
election (the "Election Date"), except in the case of death or
Disability of such Member (in which case Section 3.4 (d) shall
apply) and (ii) such Member complies with the administrative
procedures set forth by the Plan Administrator with respect to
the making of a Lump Sum Election.
(c) A Member making an election under Section 3.4(a) may specify
the portion of his Retirement or Deferred Vested Benefit under
the Plan to be received in a lump sum as follows: 0%, 25%,
50%, 75%, or 100%.
(d) In the event a Member who has made an Election pursuant to
Section 3.4(a) dies or becomes Disabled while employed by the
Company or an Affiliated Employer and such death or total and
permanent Disability occurs during the 12 calendar-month
period immediately following the Election Date, the condition
under Section 3 .4(b)(i) shall be deemed satisfied with
respect to such Member.
3.5 CESSATION OF BENEFITS. Subject to Section 3.8 hereof, no benefits or no
further benefits, as the case may be, shall be paid to a Member, Vested
Former Member or Surviving Spouse if the Member or Vested Former Member
has:
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(a) become a stockholder (unless such stock is listed on a
national securities exchange or traded on a daily basis in the
over-the-counter market and the Member's or Vested Former
Member's ownership interest is not in excess of 2% of the
company whose shares are being purchased), employee, officer,
director or consultant of or to a Company, or a member or an
employee of or a consultant to a partnership or any other
business or firm, which competes with any of the businesses
owned or operated by the Company, or if the Member or Vested
Former Member becomes associated with a company, partnership
or individual which company, partnership or individual acts as
a consultant to businesses in competition with the Company,
such Member or Vested Former Member provided services to such
competing businesses, whether or not, in any of the foregoing
cases, such Member or Vested Former Member accepts any form of
compensation from such competing entity or consultant; or
(b) been discharged from employment with the Company or any
Affiliated Employer for "cause." "Cause" shall mean "Cause" as
defined in an employment agreement between the Company and the
Member or Former Member or Vested Former Member then in effect
or, if no such employment agreement containing a definition of
Cause is then in effect, "Cause" shall mean (i) willful
malfeasance or willful misconduct by the Member or Former
Vested Member in connection with his or her employment, (ii)
continuing failure to perform such duties as are requested by
any employee to whom the Member or Vested Former Member
reports or the Board, or (iii) the commission by a Member or
Vested Former Member of (A) any felony or (B) any misdemeanor
involving moral turpitude.
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3.6 NOTIFICATION OF CESSATION OF BENEFITS. Subject to Section 3.8 hereof,
in any case described in Section 3.5, the Member, Vested Former Member
or Surviving Spouse shall be given prior written notice that no
benefits or no further benefits, as the case may be, will be paid to
such Member, Vested Former Member or Surviving Spouse. Such written
notice shall specify the particular act(s), or failures to act, and the
basis on which the decision to cease paying his or her benefits has
been made.
3.7 REPAYMENT OF BENEFITS PAID AS LUMP SUM.
(a) Subject to Section 3.8 hereof, a Member or Vested Former
Member who receives in a lump sum any portion of his or her
Retirement Benefit or Deferred Vested Benefit pursuant to a
Lump Sum Election, shall receive such lump sum portion of such
Retirement Benefit or Deferred Vested Benefit subject to the
condition that if such Member or Vested Former Member engages
in any of the acts described in Section 3.5(a), then such
Member or Vested Former Member shall, within 60 days after
written notice by the Company, repay to the Company the amount
described in Section 3.7(b).
(b) The amount described in this section shall equal the amount of
the Member's or Vested Former Member's lump sum benefit paid
under this Plan to which such Member or Vested Former Member
would not have been entitled, if such lump sum benefit had
instead been payable in the form of an annuity under this Plan
and such annuity payments were subject to the provisions of
Section 3.5.
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3.8 CHANGE IN CONTROL. Notwithstanding anything to the contrary contained
herein, the provisions of Sections 3.5 through 3.7 shall be of no force
or effect from and after a Change in Control with respect to any Member
and Vested Former Member who is employed by the Company or an
Affiliated Employer as of such Change in Control.
SECTION 4 - DISABILITY BENEFITS
4.1 DISABILITY BENEFITS.
(a) ELIGIBILITY. A Member who is enrolled for the maximum
disability insurance coverage available under the Basic
Disability Plan and who has become Disabled shall be entitled
to the Disability Benefit described in Section 4.1(b).
(b) AMOUNT. The Disability Benefit of a Member entitled thereto
shall be an annual benefit payable in monthly installments
under this Plan during the same period as disability benefits
are actually paid by the Basic Disability Plan, in an amount
equal to 60% of the Member's Covered Earnings, offset by the
Member's (i) Basic Disability Plan Benefit, (ii) Basic Plan
Benefit, if the Basic Disability Plan Benefit does not already
include an offset for such Basic Plan Benefit, and (iii) Other
Disability Income.
SECTION 5 - SURVIVING SPOUSE'S BENEFITS
5.1 DEATH PRIOR TO BENEFIT COMMENCEMENT. Upon the death of a Member or
Vested Former Member, prior to the commencement of his or her
Retirement Benefit or Deferred Vested Benefit hereunder, his or her
Surviving Spouse will be entitled to a Surviving Spouse's
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Benefit under this Plan equal to 50% of the Retirement or Deferred
Vested Benefit that would have been provided from the Plan had the
Member or Vested Member retired from or terminated employment with the
Company or an Affiliated Employer on the date of death.
5.2 DEATH ON OR AFTER BENEFIT COMMENCEMENT. Upon the death of a Vested
Former Member while he or she is receiving Retirement or Deferred
Vested Benefits, his or her Surviving Spouse shall receive a Surviving
Spouse's Benefit equal to 50% of the Benefit he or she was receiving at
the time of death. Notwithstanding the foregoing, no benefit shall be
payable under this Section 5.2 to the extent a Retirement Benefit or
Deferred Vested Benefit was previously paid to a Member or Vested
Former Member in the form of a lump sum.
5.3 COMMENCEMENT OF SURVIVING SPOUSE'S BENEFIT. Except as provided in
Section 5.4, the Surviving Spouse's Benefit provided under Sections 5.1
or 5.2 will be payable monthly, commencing on the first day of the
month coincident with or next following the date of the Member's or
Vested Former Member's death, or, if the Member or Vested Former Member
had not attained age 55, on the date such Member or Vested Former
Member would have attained age 55 had he or she lived. Such benefits
shall continue until the first day of the month in which the Surviving
Spouse dies.
5.4 LUMP SUM PAYMENT.
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(a) If a Member or a Vested Former Member made an Election under
Section 3.4 but such Member or Vested Former Member died prior
to such lump sum payment, the Surviving Spouse's Benefit
payable under Section 5.1 hereof will be payable in the form
or combination of forms of payment so elected by such Member
or Vested Former Member pursuant to such Lump Sum Election.
The amount of any lump sum payment under the Plan shall be
determined using the actuarial assumptions set forth in
Section 3.4(a).
(b) If the lump sum value, determined in the same manner as
provided under Section 3.4(a), of a Surviving Spouse's Benefit
is $10,000 or less at the time such Surviving Spouse's Benefit
is payable under this Plan, such benefit shall be payable as a
lump sum.
(c) Any Surviving Spouse's Benefit which is payable as a lump sum
shall be paid within 60 days after the date when any portion
of such benefit payable in annuity form commences or would
commence if any portion of such Surviving Spouse's Benefit
were payable as an annuity as set forth in Section 5.3.
5.5 REDUCTION. Notwithstanding the foregoing provisions of Section 5, the
amount of a Surviving Spouse's Benefit shall be reduced by one
percentage point for each year (where a half year or more is treated as
a full year) in excess of ten years that the age of the Member or
Vested Former Member exceeds the age of the Surviving Spouse.
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SECTION 6 - PLAN ADMINISTRATOR
6.1 DUTIES AND AUTHORITY. The Plan Administrator shall be responsible for
the administration of the Plan and may delegate to any management
committee, employee, director or agent its responsibility to perform
any act hereunder, including, without limitation, those matters
involving the exercise of discretion; provided, that such delegation
shall be subject to revocation at any time at the Plan Administrator's
discretion. The Plan Administrator shall have the authority to
determine all questions arising in connection with the Plan, to
interpret the provisions of the Plan and to construe all of its terms,
to adopt, amend, and rescind rules and regulations for the
administration of the Plan, and generally to conduct and administer the
Plan and to make all determinations in connection with the Plan as may
be necessary or advisable. All such actions of the Plan Administrator
shall be conclusive and binding upon all Members, Former Members,
Vested Former Members and Surviving Spouses.
SECTION 7 - MISCELLANEOUS
7.1 AMENDMENT; TERMINATION. The Board of Directors of the Company, may, in
its sole discretion, terminate, suspend or amend this Plan at any time
or from time to time, in whole or in part; provided, however, that no
termination, suspension or amendment of the Plan may adversely affect
(a) a Member's or Vested Former Member's benefit under the Plan to
which he or she is entitled hereunder, or, (b) a Vested Former Member's
right or the right of a Surviving Spouse to receive or to continue to
receive a benefit in accordance with the Plan, such benefits or rights
as in effect on the date immediately preceding the date of such
termination, suspension or amendment. Notwithstanding the
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foregoing, the Employee Benefits Committee of the Company may amend the
Plan without the approval of the Board of Directors of the Company with
respect to amendments that such Committee determines do not have a
significant effect on the cost of the Plan.
7.2 NO EMPLOYMENT RIGHTS. Nothing contained herein will confer upon any
Member, Former Member or Vested Former Member the right to be retained
in the service of the Company or any Affiliated Employee, nor will it
interfere with the right of the Company or any Affiliated Employer to
discharge or otherwise deal with Members, Former Members or Vested
Former Members with respect to matters of employment.
7.3 PAYOUT IN DISCRETION OF THE PLAN ADMINISTRATOR. Notwithstanding
anything herein to the contrary, at any time following the termination
of service of the Member or Vested Former Member, the Plan
Administrator may authorize, under uniform rules applicable to all
Members, Vested Former Members and Surviving Spouses under the Plan, a
lump sum distribution of a Member's, Vested Former Member's and/or
Surviving Spouse's Retirement Benefit or Surviving Spouse's Benefit
under the Plan in an amount equal to the present value of such
Retirement Benefit or Surviving Spouse's Benefit, using the actuarial
assumptions then in use for funding purposes under the IMS Health
Incorporated Retirement Plan, in full satisfaction of all present and
future Plan liability with respect to such Member, Vested Former Member
and/or Surviving Spouse, if the amount of such present value is less
than $250,000. Such lump sum distribution may be made without the
consent of the Member, Vested Former Member or Surviving Spouse.
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7.4 UNFUNDED STATUS. Members and Vested Former Members shall have the
status of general unsecured creditors of the Company, and this Plan
constitutes a mere promise by the Company to make benefit payments at
the time or times required hereunder. It is the intention of the
Company that this Plan be unfunded for tax purposes and for purposes of
Title I of ERISA and any trust created by the Company and any assets
held by such trust to assist the Company in meeting its obligations
under the Plan shall meet the requirements necessary to retain such
unfunded status.
7.5 ARBITRATION. Any dispute or controversy arising under or in connection
with the Plan shall be settled exclusively by arbitration in New York,
New York in accordance with the rules of the American Arbitration
Association in effect at the time of such arbitration. The Company
shall pay the entire costs of any proceeding brought by a Member,
Vested Former Member, Former Member, or Surviving Spouse hereunder,
including the fees and expenses of counsel and pension experts engaged
by such person, and such expenses shall be reimbursed promptly upon
evidence that such expenses have been incurred without awaiting the
outcome of the proceedings; provided however, that such costs and
expenses shall be repaid to the Company by the recipient of same if it
is finally determined by the arbitrators that the position taken by
such person was entirely without merit. Failure of such person to
prevail in any dispute or controversy shall not be the sole basis on
which such determination shall be made.
7.6 NO ALIENATION. A Member's or Vested Former Member's right to benefit
payments under the Plan shall not be subject in any manner to
anticipation, alienation, sale, transfer,
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assignment, pledge, encumbrance, attachment or garnishment by creditors
or such Member or Vested Former Member or his or her Surviving Spouse.
7.7 WITHHOLDING. The Company may withhold from any benefit under the Plan
an amount sufficient to satisfy its tax withholding obligations.
7.8 GOVERNING LAW. The Plan shall be governed by and construed in
accordance with the laws of the State of New York applicable to
contracts made and to be performed in such state to the extent not
preempted by federal law.
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IN WITNESS WHEREOF, the Company has caused this document to be executed
by its officer effective July 25, 2000.
IMS Health Incorporated
By: /s/ Victoria R. Fash
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Its: President and Chief Executive Officer
Date: July 25, 2000
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