<PAGE> 1
As filed with the Securities Exchange Commission on November 21, 1996
Registration No. 333-
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
QUINTILES TRANSNATIONAL CORP.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
North Carolina 56-1714315
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4709 Creekstone Drive, Riverbirch Building, Suite 300
Durham, North Carolina 27703-8411
(Address of Principal Executive Offices) (Zip Code)
QUINTILES TRANSNATIONAL CORP. EMPLOYEE STOCK PURCHASE PLAN
QUINTILES BRI NONQUALIFIED STOCK OPTION PLAN
INNOVEX LIMITED 1996 UNAPPROVED EXECUTIVE SHARE OPTION SCHEME
(Full title of the plans)
Dennis B. Gillings, Ph.D.
Chairman of the Board and Chief Executive Officer
Quintiles Transnational Corp.
4709 Creekstone Drive, Riverbirch Building, Suite 300
Durham, North Carolina 27703-8411
(Name and address of agent for service)
(919) 941-2000
--------------
(Telephone number, including area code, of agent for service)
Copy to:
Gerald F. Roach, Esq.
Robert E. Duggins, Esq.
SMITH, ANDERSON, BLOUNT, DORSETT, MITCHELL & JERNIGAN, L.L.P.
Post Office Box 2611
Raleigh, North Carolina 27602-2611
(919) 821-1220
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
========================================================================================================================
Title of securities to be registered Amount to Proposed Proposed maximum Amount of
be maximum offering aggregate offering Registration
registered(1) price per share(2) price fee(3)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $.01 1,486,265 $61.375 $91,219,514 $27,642
per share shares
========================================================================================================================
</TABLE>
(1) Plus such indeterminate number of shares as may be issued pursuant to
certain anti-dilution provisions contained in the plans.
(2) Pursuant to Rule 457(c), based upon the average of the high and low prices
for the Company's Common Stock reported on the Nasdaq Stock Market on
November 19, 1996
<PAGE> 2
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
EXPLANATORY NOTE
As permitted by the rules of the Securities and Exchange Commission (the
"Commission"), this registration statement omits the information specified in
Part I (Items 1 and 2) of Form S-8. The documents containing the information
specified in Part I will be delivered to the participants in the Plans as
required by Rule 428(b) under the Securities Act. Such documents are not being
filed with the Commission as part of this registration statement or as
prospectuses or prospectus supplements pursuant to Rule 424.
2
<PAGE> 3
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents have been filed with the Commission and are
incorporated herein by reference:
(a) Annual Report on Form 10-K for the fiscal year
ended December 31, 1995.
(b) Quarterly Reports on Form 10-Q for the fiscal
quarters ended March 31, 1996, June 30, 1996, and September
30, 1996.
(c) Current Reports on Form 8-K dated April 16, 1996
and October 6, 1996.
(d) Registration Statement on Form 8-A filed with the
Commission on February 28, 1994 and amended April 11, 1994
containing a description of the Common Stock of the Company.
All reports and other documents filed by the Company subsequent to the
date hereof pursuant to Sections 13(a), 13(c), 14, and 15(d) of the Securities
Exchange Act of 1934, prior to the filing of a post-effective amendment which
indicates that all securities offered under the plan have been sold or which
deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference in this registration statement and to be a part
hereof from the date of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES
Not Applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not Applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The North Carolina Business Corporation Act contains provisions
prescribing the extent to which present or former directors, officers, or
employees of a corporation shall or may be indemnified against liabilities that
they may incur in their capacities as such. Under those provisions, the
availability or requirement of indemnification or reimbursement of expenses is
dependent on numerous factors, including whether the action is brought by the
corporation or by outsiders and the extent to which the potential indemnitee is
successful in his defense. The statute also permits the corporation to
purchase and maintain insurance on behalf of its directors and officers against
liabilities that they may incur in their capacities as such, whether or not the
corporation would have the power to indemnify them under other provisions of
the statute.
As permitted by North Carolina law, Article IX of the Company's Bylaws
provides for the indemnification of directors and officers, employees, or
agents of the Company within the limitations permitted by North Carolina law.
As permitted by North Carolina law, Article XI of the Company's Amended and
Restated Articles of Incorporation also provides for the limitation of the
personal liability of directors from monetary damages for breach of duty as a
director provided that the limitation of liability does not apply to (i) acts or
omissions not made in good faith that the director at the time of such breach
knew or believed were in conflict with the best interests of the corporation;
(ii) any liability under North
3
<PAGE> 4
Carolina Business Corporation Act Section 55-8-33; (iii) any transaction from
which the director derived an improper personal benefit; or (iv) acts or
omissions occurring prior to the date the provision became effective.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not Applicable.
ITEM 8. EXHIBITS
The following exhibits are filed or incorporated by reference as a part of
this registration statement:
Exhibit Description
No.
4.1 Quintiles Transnational Corp. Employee Stock Purchase Plan
4.2 Quintiles BRI Nonqualified Stock Option Plan
4.3 Innovex Limited 1996 Unapproved Executive Share Option Scheme
5 Opinion of Smith, Anderson, Blount, Dorsett, Mitchell & Jernigan,
L.L.P.
23.1 Consent of Smith, Anderson, Blount, Dorsett, Mitchell & Jernigan,
L.L.P. (contained in the opinion submitted as Exhibit 5 hereto)
23.2 Consent of Ernst & Young LLP
24.1 Power of Attorney (included as part of the signature page)
ITEM 9. UNDERTAKINGS
a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or
sales are being made, a post-effective amendment to
this registration statement:
(i) To include any prospectus required by
section 10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of the
registration statement (or the most recent
post-effective amendment thereof) which,
individually or in the aggregate, represent a
fundamental change in the information set forth
in the registration statement;
(iii) To include any material information with
respect to the plan of distribution not
previously disclosed in the registration
statement or any material change to such
information in the registration statement.
Provided, however, that paragraphs (a)(1)(i) and
(a)(1)(ii) do not apply if the registration statement
is on Form S-3, Form S-8, and the information required
to be included in a post-effective amendment by
4
<PAGE> 5
those paragraphs is contained in periodic reports
filed by the registrant pursuant to section 13 or
section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the registration
statement.
(2) That, for the purpose of determining any
liability under the Securities Act of 1933, each such
post-effective amendment shall be deemed to be a new
registration statement relating to the securities
offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona
fide offering thereof; and
(3) To remove from registration by means of a
post-effective amendment any of the securities being
registered which remain unsold at the termination of
the offering.
b) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of
1933, each filing of the registrant's annual report pursuant to
section 13(a) or section 15(d) of the Securities Exchange Act of
1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities
Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
h) The undersigned registrant hereby undertakes that, insofar as
indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons
of the registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the opinion of
the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant
of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit
to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the
Act and will be governed by the final adjudication of such issue.
5
<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Durham, State of North Carolina, on the 21st day of
November, 1996.
QUINTILES TRANSNATIONAL CORP.
By: /s/ Dennis B. Gillings
----------------------------------
Dennis B. Gillings
Chairman of the Board of Directors
and Chief Executive Officer
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POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Dennis B. Gillings and Rachel R. Selisker and
each of them, each with full power to act without the other, his true and
lawful attorneys-in-fact and agents, with full powers of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any or all amendments to this registration statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents full power and authority to do and perform each
and every act and thing requisite and necessary to be done in and about the
premises, as fully for all intents and purposes as he or she might or could do
in person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or their substitutes, may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons on
November 21, 1996 in the capacities indicated.
SIGNATURE TITLE
/s/ Dennis B. Gillings Chairman of the Board of Directors,
- ------------------------ President and Chief
Dennis B. Gillings Executive Officer
/s/ Santo J. Costa President, Chief Operating Officer
- ------------------------ and Director
Santo J. Costa
/s/ Rachel R. Selisker Chief Financial Officer, Vice
- ------------------------ President Finance, Treasurer
Rachel R. Selisker and Director (Principal Accounting
and Financial Officer)
/s/ William A. Sollecito Director
- ------------------------
William A. Sollecito
/s/ Ludo J. Reynders Director
- ------------------------
Ludo J. Reynders
/s/ Sara B. Creagh Director
- ------------------------
Sara B. Creagh
/s/ Richard H. Thompson Director
- ------------------------
Richard H. Thompson
/s/ Chester W. Douglass Director
- ------------------------
Chester W. Douglass
/s/ John G. Fryer Director
- ------------------------
John G. Fryer
Director
- ------------------------
Eric J. Souetre
/s/ Arthur M. Pappas Director
- ------------------------
Arthur M. Pappas
/s/ Robert C. Bishop Director
- ------------------------
Robert C. Bishop
/s/ Lawrence Lewin Director
- ------------------------
Lawrence Lewin
7
<PAGE> 8
QUINTILES TRANSNATIONAL CORP.
EXHIBIT INDEX
<TABLE>
Exhibit Description Page
No. No.
- ------- -----------
<S> <C> <C>
4.1 Quintiles Transnational Corp. Employee Stock Purchase Plan
4.2 Quintiles BRI Nonqualified Stock Option Plan
4.3 Innovex Limited 1996 Unapproved Executive Share Option Scheme
5 Opinion of Smith, Anderson, Blount, Dorsett, Mitchell & Jernigan, L.L.P.
23.1 Consent of Smith, Anderson, Blount, Dorsett, Mitchell & Jernigan,
L.L.P. (contained in the opinion submitted as Exhibit 5 hereto)
23.2 Consent of Ernst & Young LLP
24.1 Power of Attorney (included as part of the signature page)
</TABLE>
8
<PAGE> 1
EXHIBIT 4.1
Quintiles Transnational Corp. Employee Stock Purchase Plan
<PAGE> 2
QUINTILES TRANSNATIONAL CORP. EMPLOYEE STOCK PURCHASE PLAN
ARTICLE I
INTRODUCTION
1.01 Purpose. The Quintiles Transnational Corp. Employee Stock Purchase
Plan (the "Plan") is intended to provide a method whereby employees of
Quintiles Transnational Corp. (the "Company") and its Eligible Subsidiary
Corporations (as defined below) will have an opportunity to acquire a
proprietary interest in the Company through the purchase of shares of the
Common Stock of the Company.
1.02 Rules of Interpretation. It is the intention of the Company to have
the Plan qualify as an "employee stock purchase plan" under Section 423 of the
Internal Revenue Code of 1986, as amended (the "Code"). The provisions of the
Plan shall be construed so as to extend and limit participation in a manner
consistent with the requirements of that section of the Code.
ARTICLE II
DEFINITIONS
2.01 "Compensation" shall mean the gross cash compensation (including,
wage, salary and overtime earnings) paid by the Company or any Eligible
Subsidiary Corporation to a participant in accordance with the terms of
employment, but excluding all bonus payments, expense allowances and
compensation paid in a form other than cash.
2.02 "Committee" shall mean the individuals described in Article XI.
2.03 "Eligible Subsidiary Corporation" shall mean each Subsidiary
Corporation the employees of which are entitled to participate in the Plan, as
listed or referred to on Schedule 2.03 hereto.
2.04 "Employee" shall mean any person employed by the Company or any
Eligible Subsidiary Corporation, including any full-time, part-time or
temporary employee.
2.05 "Plan Representative" shall mean any person designated from time to
time by the Committee to receive certain notices and take certain other
administrative actions relating to participation in the Plan.
2.06 "Subsidiary Corporation" shall mean any present or future corporation
which (i) is or becomes a "subsidiary corporation" of Quintiles Transnational
Corp. as that term is defined in Section 424 of the Code and (ii) is designated
as a participant in the Plan by the Committee.
ARTICLE III
ELIGIBILITY AND PARTICIPATION
3.01 Initial Eligibility. Each Employee who shall have completed six
consecutive months of employment with the Company or any corporation or entity
acquired by the Company or any Eligible Subsidiary Corporation and shall be
employed by the Company or any Eligible Subsidiary Corporation on the date his
or her participation in the Plan is to become effective shall be eligible to
participate in Offerings (as defined below) under the Plan which commence after
such six-month period has concluded. Persons who are not Employees shall not
be eligible to participate in the Plan.
<PAGE> 3
3.02 Restrictions on Participation. Notwithstanding any provision of the
Plan to the contrary, no Employee shall be granted an option to purchase shares
of Common Stock under the Plan:
(a) if, immediately after the grant, such Employee would own stock and/or
hold outstanding options to purchase stock possessing 5% or more of the total
combined voting power or value of all classes of stock of the Company (for
purposes of this paragraph, the rules of Section 424(d) of the Code shall apply
in determining stock ownership of any Employee); or
(b) which permits such Employee's rights to purchase stock under all
Employee stock purchase plans of the Company to accrue at a rate which exceeds
$25,000 of fair market value of the stock (determined at the time such option
is granted) for each calendar year in which such option is outstanding at any
time.
3.03 Commencement of Participation. An eligible Employee may become a
participant by completing an authorization for payroll deductions on the form
provided by the Company and filing the completed form with the Plan
Representative on or before the filing date set therefor by the Committee,
which date shall be prior to the Offering Commencement Date for the next
following Offering (as such terms are defined below). Payroll deductions for a
participant shall commence on the next following Offering Commencement Date
after the Employee's authorization for payroll deductions becomes effective and
shall continue until termination of the Plan or the participant's earlier
termination of participation in the Plan. Each participant in the Plan shall
be deemed to continue participation until termination of the Plan or such
participant's earlier termination of participation in the Plan pursuant to
Article VIII below.
ARTICLE IV
STOCK SUBJECT TO THE PLAN AND OFFERINGS
4.01 Stock Subject to the Plan. Subject to the provisions of Section
12.04 of the Plan, the Company's Board of Directors shall reserve initially for
issuance under the Plan an aggregate of one hundred thousand (100,000) shares
of the Company's common stock (the "Common Stock"), which shares shall be
authorized but unissued shares of Common Stock. The Company's Board of
Directors may from time to time reserve additional shares of authorized and
unissued Common Stock for issuance pursuant to the Plan; provided, however,
that at no time shall the number of shares of Common Stock reserved be greater
than permitted by applicable law.
4.02 Offerings. Except as described below with respect to the first year
the Plan is in effect, the Plan will be implemented by four annual offerings of
the Company's Common Stock each calendar year (the "Offerings"). There will be
only one Offering in calendar 1996, which will begin on October 1, 1996 and end
on December 31, 1996. Thereafter, in each year that the Plan is in effect, the
first Offering will begin on January 1 and end on March 31, the second Offering
will begin on April 1 and end on June 30, the third Offering will begin on July
1 and end on September 30, and the fourth Offering will begin on October 1 and
end on December 31. The first day of each Offering shall be deemed the
"Offering Commencement Date" and the last day the "Offering Termination Date"
for such Offering.
ARTICLE V
PAYROLL DEDUCTIONS
5.01 Amount of Deduction. The form described in Section 3.03 will permit
a participant to elect payroll deductions of zero percent (0%) or any whole
percentage from one percent (1%) through fifteen percent (15%) of such
participant's Compensation for each pay period during an Offering.
2
<PAGE> 4
5.02 Participant's Account. All payroll deductions made for a participant
shall be credited to an account established for such participant under the
Plan. A participant may not make any separate cash payment into such account.
5.03 Changes in Payroll Deductions. A participant may reduce or increase
future payroll deductions (within the limits described in Section 5.01) by
filing with the Plan Representative a form provided by the Company for such
purpose. The effective date of any increase or reduction in future payroll
deductions will be the first day of the next pay period succeeding processing
of the change form.
ARTICLE VI
GRANTING OF OPTION
6.01 Number of Option Shares. On the Commencement Date of each Offering,
each participating Employee shall be deemed to have been granted an option to
purchase a maximum number of shares of Common Stock equal to (i) that
percentage of the Employee's Compensation which the Employee has elected to
have withheld (but not in any case in excess of 15%) multiplied by (ii) the
Employee's Compensation during the Offering then divided by (iii) the
applicable Option Price determined as provided in Section 6.02 below.
6.02 Option Price. The option price of stock purchased with payroll
deductions made during any Offering (the "Offering Price") for a participant
therein shall be the lower of:
(a) 85% of the closing price of the stock on the Offering Commencement
Date for such Offering or the nearest prior business day on which trading
occurred on the NASDAQ National Market System; or
(b) 85% of the closing price on the Offering Termination Date for such
Offering or the nearest prior business day on which trading occurred on the
NASDAQ National Market System. If the Common Stock of the Company is not
admitted to trading on any of the aforesaid dates for which closing prices of
the stock are to be determined, then reference shall be made to the fair market
value of the stock on each such date, as determined on such basis as shall be
established or specified for the purpose by the Committee.
ARTICLE VII
EXERCISE OF OPTION
7.01 Automatic Exercise. Each Plan participant's option for the purchase
of stock with payroll deductions made during any Offering will be deemed to
have been exercised automatically on the applicable Offering Termination Date
for the purchase of the number of full shares of Common Stock which the
accumulated payroll deductions in the participant's account at the time will
purchase at the applicable Option Price (but not in excess of the number of
shares for which outstanding options have been granted to the participant
pursuant to Section 6.01).
7.02 Withdrawal of Account. No participant in the Plan shall be entitled
to withdraw any amount from the accumulated payroll deductions in his or her
account; provided, however, that a participant's accumulated payroll deductions
shall be refunded to the participant as and to the extent specified in Section
8.01 below upon termination of such participant's participation in the Plan.
7.03 Fractional Shares. Fractional shares of Common Stock will not be
issued under the Plan. Any accumulated payroll deductions which would have
been used to purchase fractional shares, unless refunded pursuant to Section
7.02 above, will be held for the purchase of Common Stock in the next following
Offering, without interest.
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<PAGE> 5
7.04 Exercise of Options. During a participant's lifetime, options held
by such participant shall be exercisable only by such participant.
7.05 Delivery of Stock. As promptly as practicable after the Offering
Termination Date of each Offering, the Company will deliver to each participant
in such Offering, as appropriate, the shares of Common Stock purchased therein
upon exercise of such participant's option. The Company may deliver such
shares in certificated or book entry form, at the Company's sole election.
7.06 Stock Transfer Restrictions. The Plan is intended to satisfy the
requirements of Section423 of the Code. A participant will not obtain the
benefits of this provision if such participant disposes of shares of Common
Stock acquired pursuant to the Plan within two (2) years from the Offering
Commencement Date or within one (1) year from the date such Common Stock is
purchased by the participant, whichever is later.
ARTICLE VIII
WITHDRAWAL
8.01 In General. A participant may stop participating in the Plan at any
time by giving written notice to the Plan Representative. Upon processing of
any such written notice, no further payroll deductions will be made from the
participant's Compensation during such Offering or thereafter, unless and until
such participant elects to resume participation in the Plan by providing
written notice to the Plan Representative pursuant to Section 3.03 above. Such
participant's payroll deductions accumulated prior to processing of such notice
shall be applied toward purchasing full shares of Common Stock in the
then-current Offering as provided in Section 7.01 above. Any cash balance
remaining after the purchase of shares in such Offering shall be refunded
promptly to such participant.
8.02 Effect on Subsequent Participation. A participant's withdrawal from
any Offering will not have any effect upon such participant's eligibility to
participate in any succeeding Offering or in any similar plan which may
hereafter be adopted by the Company and for which such participant is otherwise
eligible.
8.03 Termination of Employment. Upon termination of a participant's
employment with the Company or any Eligible Subsidiary Corporation (as the case
may be) for any reason, including retirement or death, the participant's
payroll deductions accumulated prior to such termination, if any, shall be
applied toward purchasing full shares of Common Stock in the then-current
Offering, and any cash balance remaining after the purchase of shares in such
Offering shall be refunded to him or her, or, in the case of his or her death,
to the person or persons entitled thereto under Section 12.01, and his or her
participation in the Plan shall be deemed to be terminated.
ARTICLE IX
INTEREST
9.01 Payment of Interest. No interest will be paid or allowed on any
money paid into the Plan or credited to the account of or distributed to any
participant Employee.
ARTICLE X
STOCK
10.01 Participant's Interest in Option Stock. No participant will have
any interest in shares of Common Stock covered by any option held by such
participant until such option has been exercised as provided in Section 7.01
above.
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<PAGE> 6
10.02 Registration of Stock. Shares of Common Stock purchased by a
participant under the Plan will be registered in the name of the participant,
or, if the participant so directs by written notice to the Plan Representative
prior to the Offering Termination Date applicable thereto, in the names of the
participant and one such other person as may be designated by the participant,
as joint tenants with rights of survivorship or as tenants by the entireties,
to the extent permitted by applicable law.
10.03 Restrictions on Exercise. The Board of Directors may, in its
discretion, require as conditions to the exercise of any option that the shares
of Common Stock reserved for issuance upon the exercise of such option shall
have been duly listed, upon official notice of issuance, upon a stock exchange
or market, and that either:
(a) a registration statement under the Securities Act of 1933, as
amended, with respect to said shares shall be effective, or
(b) the participant shall have represented at the time of purchase,
in form and substance satisfactory to the Company, that it is his or her
intention to purchase the shares for investment and not for resale or
distribution.
ARTICLE XI
ADMINISTRATION
11.01 Appointment of Committee. The Board of Directors shall appoint a
committee (the "Committee") to administer the Plan, which shall consist solely
of no fewer than three "non-employee directors" (as defined in Rule 16b-3(a)(3)
promulgated under the Securities Act of 1933, as amended).
11.02 Authority of Committee. Subject to the express provisions of the
Plan, the Committee shall have plenary authority in its discretion to interpret
and construe any and all provision of the Plan, to adopt rules and regulations
for administering the Plan, and to make all other determinations deemed
necessary or advisable for administering the Plan. The Committee's
determination of the foregoing matters shall be conclusive.
11.03 Rules Governing the Administration of the Committee. The Board of
Directors may from time to time appoint members of the Committee in
substitution for or in addition to members previously appointed and may fill
vacancies, however caused, in the Committee. The Committee may select one of
its members as its chairman, shall hold its meetings at such times and places
as it shall deem advisable, and may hold telephonic meetings. All
determinations of the Committee shall be made by a majority of its members. A
decision or determination reduced to writing and signed by a majority of the
members of the Committee shall be as fully effective as if it had been made by
a majority vote at a meeting duly called and held. The Committee may appoint a
secretary and shall make such rules and regulations for the conduct of its
business as it shall deem advisable.
ARTICLE XII
MISCELLANEOUS
12.01 Designation of Beneficiary. A participant may file with the Plan
Representative a written designation of a beneficiary who is to receive any
shares of Common Stock and/or cash under the Plan upon the participant's death.
Such designation of beneficiary may be changed by the participant at any time
by written notice to the Plan Representative. Upon the death of a participant
and receipt by the Company of proof of identity and existence at the
participant's death of a beneficiary validly designated by the participant
under the Plan, and subject to Article VIII above concerning withdrawal from
the Plan, the Company shall deliver such shares of Common
5
<PAGE> 7
Stock and/or cash to such beneficiary. In the event of the death of a
participant lacking a beneficiary validly designated under the Plan who is
living at the time of such participant's death, the Company shall deliver such
shares of Common Stock and/or cash to the executor or administrator of the
estate of the participant, or if no such executor or administrator has been
appointed (to the knowledge of the Company), the Company, in its discretion,
may deliver such shares of Common Stock and/or cash to the spouse or to any one
or more dependents of the participant, in each case without any further
liability of the Company whatsoever under or relating to the Plan. No
beneficiary shall, prior to the death of the participant by whom he or she has
been designated, acquire any interest in the shares of Common Stock and/or cash
credited to the participant under the Plan.
12.02 Transferability. Neither payroll deductions credited to any
participant's account nor any option or rights with regard to the exercise of
an option or to receive Common Stock under the Plan may be assigned,
transferred, pledged, or otherwise disposed of in any way by the participant
other than by will or the laws of descent and distribution. Any such attempted
assignment, transfer, pledge or other disposition shall be without effect,
except that the Company may, in its discretion, treat such act as an election
to withdraw from participation in the Plan in accordance with Section 8.01.
12.03 Use of Funds. All payroll deductions received or held by the
Company under the Plan may be used by the Company for any corporate purpose.
The Company shall not be obligated to segregate such payroll deductions.
12.04 Adjustment Upon Changes in Capitalization.
(a) If, while any options are outstanding under the Plan, the
outstanding shares of Common Stock of the Company have increased, decreased,
changed into, or been exchanged for a different number or kind of shares or
securities of the Company through any reorganization, merger, recapitalization,
reclassification, stock split, reverse stock split or similar transaction,
appropriate and proportionate adjustments may be made by the Committee in the
number and/or kind of shares which are subject to purchase under outstanding
options and in the Option Price or Prices applicable to such outstanding
options. In addition, in any such event, the number and/or kind of shares
which may be offered in the offerings described in Article IV hereof shall also
be proportionately adjusted. No such adjustments shall be made for or in
respect of stock dividends. For purposes of this paragraph, any distribution
of shares of Common Stock to shareholders in an amount aggregating 20% or more
of the outstanding shares of Common Stock shall be deemed a stock split, and
any distribution of shares aggregating less than 20% of the outstanding shares
of Common Stock shall be deemed a stock dividend.
(b) Upon the dissolution or liquidation of the Company, or upon a
reorganization, merger or consolidation of the Company with one or more
corporations as a result of which the Company is not the surviving corporation,
or upon a sale of substantially all of the property or capital stock of the
Company to another corporation, the holder of each option then outstanding
under the Plan will thereafter be entitled to receive at the next Offering
Termination Date, upon the exercise of such option, for each share as to which
such option shall be exercised, as nearly as reasonably may be determined, the
cash, securities and/or property which a holder of one share of the Common
Stock was entitled to receive upon and at the time of such transaction. The
Board of Directors shall take such steps in connection with such transactions
as the Board shall deem necessary to assure that the provisions of this Section
12.04 shall thereafter be applicable, as nearly as reasonably may be
determined, in relation to the said cash, securities and/or property as to
which each such holder of any such option might hereafter be entitled to
receive.
12.05 Amendment and Termination. The Board of Directors shall have
complete power and authority to terminate or amend the Plan; provided, however,
that the Board of Directors shall not,
6
<PAGE> 8
without the approval of the shareholders of the Company, alter (i) the
aggregate number of shares of Common Stock which may be issued under the Plan
(except pursuant to Section 12.04 above), or (ii) the class of employees
eligible to receive options under the Plan, other than to designate additional
Subsidiary Corporations as Eligible Subsidiary Corporations; and provided
further, however, that no termination, modification, or amendment of the Plan
may, without the consent of an Employee then having an option under the Plan to
purchase shares of Common Stock, adversely affect the rights of such Employee
under such option.
12.06 Effective Date. The Plan shall become effective as of October 1,
1996, subject to approval by the holders of a majority of the shares of Common
Stock present and represented at any special or annual meeting of the
shareholders of the Company duly held within 12 months after adoption of the
Plan. If the Plan is not so approved, the Plan shall not become effective.
12.07 No Employment Rights. The Plan does not, directly or indirectly,
create in any person any right with respect to continuation of employment by
the Company or any Subsidiary Corporation, and it shall not be deemed to
interfere in any way with the Company's or any Subsidiary Corporation's right
to terminate, or otherwise modify, any employee's employment at any time.
12.08 Effect of Plan. The provisions of the Plan shall, in accordance
with its terms, be binding upon, and inure to the benefit of, all successors of
each Employee participating in the Plan, including, without limitation, such
Employee's estate and the executors, administrators or trustees thereof, heirs
and legatees, and any receiver, trustee in bankruptcy or representative of
creditors of such Employee.
12.09 Governing Law. The law of the State of North Carolina will govern
all matters relating to this Plan except to the extent superseded by the
federal laws of the United States.
7
<PAGE> 1
EXHIBIT 4.2
Quintiles BRI Nonqualified Stock Option Plan
<PAGE> 2
QUINTILES BRI
NONQUALIFIED STOCK OPTION PLAN
1. PURPOSE
The purpose of the Quintiles BRI Nonqualified Stock Option Plan (the
"Plan") is to further the success of Quintiles Transnational Corp. (the
"Company") by making shares of the Company's Common Stock ("Common Stock")
available for purchase by eligible employees, officers, directors and
consultants of Quintiles BRI, Inc. (formerly, BRI Acquisition Corp.), a
subsidiary of the Company ("Subsidiary"), or any affiliated company or
partnership in which the Subsidiary has an ownership interest, and other
persons receiving services from or providing services to the Subsidiary in
order to provide an additional incentive to such persons to continue their
relationship with the Company and in order to give such persons a greater
interest in the Company's success. This purpose will be carried out through
the granting of options which do not meet the statutory requirements of
Sections 422 or 423 of the Internal Revenue Code of 1986, as amended (the
"Code").
2. STOCK SUBJECT TO PLAN
Subject to the provisions of Section 9 of the Plan, the Company's Board of
Directors (the "Board") shall reserve initially an aggregate of 600,000
authorized and unissued shares of Common Stock for issuance upon the exercise
of the options. The Board may from time to time reserve additional shares of
authorized and unissued Common Stock for issuance upon exercise of options. If
any option granted under the Plan shall expire or terminate for any reason
without having been exercised in full, the unpurchased shares of Common Stock
subject to the expired or terminated option shall again be available for
options under the Plan.
3. ADMINISTRATION
The Board shall designate a committee of at least two "Nonemployee
Directors" as defined in Rule 16b-3(b)(3) promulgated under Section 16 of the
Securities Exchange Act of 1934 (the "Committee") to administer the Plan. The
Committee shall report all of its actions to the Board. The Board may from
time to time remove members from the Committee and appoint their successors.
The Board shall fill all vacancies on the Committee however caused. Except as
otherwise expressly provided in the Plan, the Committee shall have absolute
discretionary authority (a) to determine the individuals to receive options,
the times when options shall be granted, the number of shares to be subject to
each option, the option price, the option period, and the time or times when
each option shall be exercisable; (b) to interpret the Plan; (c) to prescribe,
amend, and rescind rules and regulations relating to the Plan; (d) to determine
the terms and provisions (and amendments of the terms and provisions) of the
option agreements to be entered into between the Company and each Participant
granted an option under the Plan (which option agreements need not be
identical), including such terms and provisions as shall be required in the
Committee's judgment to conform to any change in any applicable law or
regulation; and (e) to make all other determinations the Committee shall deem
necessary or advisable for the Plan's administration.
No member of the Committee or the Board shall be liable to any person for
any action or determination which he or she makes in good faith.
<PAGE> 3
4. ELIGIBILITY
Subject to the provisions of Section 3, any employee, officer, director,
and consultant of the Subsidiary or any affiliated company or partnership in
which the Subsidiary has an ownership interest and other persons receiving
services from or providing services to the Subsidiary designated by the
Committee shall be eligible to receive options under the Plan (the
"Participants"). In designating Participants and in recommending the number of
shares of Common Stock to be covered by each option granted to a Participant,
the Committee may take into account the nature of the services rendered by or
for each Participant, his or her present and potential contributions to the
Company's success, and such other factors as the Committee in its discretion
shall deem relevant. The Company may grant additional options to Participants
who have already been granted options under the Plan.
5. OPTION PRICE
The Committee shall determine the purchase price of the shares of Common
Stock covered by each option, which purchase price may be above or below the
fair market value of the Common Stock at the time of the grant, as determined
by the Committee.
6. EXERCISE OF OPTION
The period during which an option may be exercised shall be determined by
the Committee when the option is granted and shall not extend more than ten
(10) years from the date on which the option is granted. The term of each
option, however, shall not extend for more than the period prescribed in
Sections 8, 9 and 10 of the Plan. Except as provided in the option agreement
relating to such option, an option may be exercised in whole or in part at any
time during its term. The Committee may impose vesting or other restrictions
on the exerciseability or conditions of options. The purchase price of the
shares of Common Stock subject to the option shall be paid in full in cash upon
the exercise of the option. The holder of an option under the Plan shall not
have any of the rights of a shareholder with respect to the Common Stock
subject to the option until such shares shall be issued to him or her upon the
exercise of the option and payment of the purchase price.
7. TRANSFERABILITY OF OPTION
Except as determined by the Committee and set forth in the option
agreement relating to such option, no option granted under the Plan shall be
transferable other than by will or by the laws of descent and distribution
(including by pledge or hypothecation) and shall be exercisable only by the
Participant or his or her duly appointed legal representative.
8. TERMINATION OF RELATIONSHIP WITH THE COMPANY
The times and conditions upon which an option will terminate where a
Participant to whom an option has been granted under the Plan terminates, or
the Company terminates, his or her employment, consultant, or service
relationship with the Subsidiary or an affiliated company or partnership in
which the Subsidiary has an ownership interest shall be determined by the
Committee when the option is granted; provided, however, that in no event shall
an option be exercisable more than ten (10) years from the date it was granted.
Nothing in the Plan or any option granted pursuant to the Plan shall (a)
confer on any individual any right to continue in the employ of the Company or
to continue any consultant or service relationship with the Company or (b)
interfere in any way with the Company's right to terminate such individual's
employment, consultant or service relationship at any time.
2
<PAGE> 4
9. ADJUSTMENT UPON CHANGES IN CAPITALIZATION
In the event of a change in the Company's Common Stock by reason of any
stock dividend, split-up, recapitalization, combination or exchange of shares,
merger, consolidation, acquisition of property or stock, separation,
reorganization or liquidation or similar action, the Committee shall make an
appropriate adjustment of the number and class of shares of Common Stock
subject to and the purchase price for each then outstanding option, consistent
with and as provided in the corresponding option agreement under the Plan. In
the event of any such change in the outstanding Common Stock, the Committee
shall adjust appropriately the aggregate number and class of shares of Common
Stock reserved and available under the Plan appropriately, and the Committee's
determination on adjustment shall be conclusive.
10. TERMINATION OF OPTIONS ON MERGER OR SALE OF ASSETS
A liquidation of the Company, a merger or consolidation in which the
Company is not the surviving or resulting corporation, or a sale of all or
substantially all of the Company's assets shall cause every option outstanding
under the Plan to terminate on the effective date of such action.
Notwithstanding the preceding sentence, upon a liquidation of the Company, a
merger or consolidation in which the Company is not the surviving or resulting
corporation, or a sale of all or substantially all of the Company's assets,
each option holder shall have the right, within his or her sole discretion, to
exercise before the effective date of such action any or all of the options he
or she then holds, but only to the extent that such options are otherwise
exercisable under the terms of the Plan. Any options not so exercised shall
terminate on the effective date of such action.
11. AMENDMENT, SUSPENSION, OR TERMINATION OF THE PLAN
The Board may at any time suspend or terminate the Plan or may amend it
from time to time in such respects as the Board may deem advisable in order
that the options granted under the Plan may conform to any changes in the law
or in any other respect which the Board may deem to be in the best interest of
the Company. Modifications or amendments to the Plan are not required to be
approved by the Company's shareholders, except to the extent required by
applicable North Carolina law or by the Company's Bylaws. No termination,
modification, or amendment of the Plan without the consent of the Participant
to whom any option shall have been previously granted shall adversely affect
such Participant's rights under such option. Unless terminated earlier in
accordance with this Section, the Plan shall terminate when all shares of
Common Stock reserved for issuance under the Plan have been issued.
12. EFFECTIVENESS OF THE PLAN
The Plan shall become effective on such date as the Board shall determine.
The exercise of each option granted pursuant to the Plan shall be subject to
the condition that if at any time the Company shall determine in its discretion
that (a) the satisfaction of withholding tax or other withholding liabilities,
(b) the listing on any securities exchange or the registration or qualification
under any state or federal law of any shares of Common Stock otherwise
deliverable upon its exercise, or (c) the consent or approval of any regulatory
body or the shareholders is necessary or desirable as a condition of, or in
connection with, such exercise or the delivery or purchase of shares of Common
Stock pursuant to such exercise, then, in any such event, such exercise shall
not be effective unless such withholding, listing, registration, qualification,
consent or approval shall have been effected or obtained free of any conditions
unacceptable to the Company.
3
<PAGE> 5
13. TIME OF GRANTING OPTIONS
Nothing contained in the Plan or in any resolution adopted or to be
adopted by the Board or the Committee will constitute the granting of an option
pursuant to the Plan. The granting of an option pursuant to the Plan will
occur only when a written option agreement is duly executed and delivered by
and on behalf of the Company and the Participant to whom such option is to be
granted.
14. APPLICABLE LAW
Except as otherwise provided herein, the Plan shall be construed and
enforced according to the laws of the State of North Carolina.
4
<PAGE> 1
EXHIBIT 4.3
Innovex Limited 1996 Unapproved Executive Share Option Scheme
<PAGE> 2
INNOVEX LIMITED
1996 UNAPPROVED EXECUTIVE SHARE OPTION SCHEME
SCHEME RULES
Adopted by the Board on 3 day of July 1996
Amended by the Board on 2 day of October 1996
KPMG
PO BOX 486
1 PUDDLE DOCK
LONDON
EC4V 3PD
0171 311 1000
<PAGE> 3
RULES OF THE INNOVEX LIMITED
1996 UNAPPROVED EXECUTIVE SHARE OPTION SCHEME
1.1 Definitions
In these Rules the following words and expressions shall have, where the
context so admits, the following meanings:
"Adoption Date" - the date on which the Scheme is adopted by the Board.
"Associated Company" - has the same meaning as in section 416 of the Income
and Corporation Taxes Act 1988.
"Auditors" - the auditors for the time being of the Company
(acting as experts and not as arbitrators).
"Board" - the board of directors of the Company or, except in
Rule 8.4, a duly constituted committee thereof.
"Company" - Innovex Limited registered in England No 3127220 or,
save for rules 2, 3 and 8.2 to 8.4, where Options
are granted pursuant to Rule 2.7 such company as
shall be at any time the Acquiring Company as
defined in Rule 5.6.
"Control" - has the same meaning as in section 840 of the Income
and Corporation Taxes Act 1988.
"Date of Grant" - the date on which an Option is, was or is to be
granted under the Scheme, pursuant to Rule 2.2.
"Dealing Day" - a day on which The Stock Exchange is open for the
transaction of business.
"Eligible Employee" - any director or employee of any Participating
Company.
"Exchange Options" - Options granted pursuant to Rule 2.3.
"Flotation" - any shares of the Company being or becoming
(a) listed on The Stock Exchange;
(b) dealt in on the Alternative
Investment Market; or
(c) listed or quoted on any other
Recognised Stock Exchange
(within the meaning of Section
841 Income and Corporation
Taxes Act 1988) or Recognised
Investment Exchange (within the
meaning of the Financial
Services Act 1986).
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<PAGE> 4
"Injury, Ill Health,
Disability" - the cessation of employment or office by reason of
injury, ill health or disability provided the Board
are satisfied, on production of such evidence as the
Board may reasonably require:
i)
that the individual has ceased to
exercise and by reason of injury, ill
health or disability is incapable of
exercising that office or employment;
and
ii) that the individual is likely to remain so
incapable for the foreseeable future.
"Market Value" - on any day the middle market quotation of a Share
as derived from the Daily Official List of The Stock
Exchange for the immediately preceding Dealing Day;
or if the Shares are not so listed, on any day the
market value of a Share determined in accordance
with the provisions of Part VIII Taxation of
Chargeable Gains Act 1992.
"Nominal Value - Options granted pursuant to Rule 2.4.
Options"
"Option" - a right to acquire Shares granted or to be granted
pursuant to Rule 2.2.
"Other Executive
Scheme" - any option scheme, other than this Scheme and any
scheme where the options are linked to savings
contracts, established by the Company or any
Associated Company thereof.
"Participating
Company" - the Company and any other company of which the
Company has Control (and which is a subsidiary of
the Company within the meaning of section 736
Companies Act 1985)
"Performance Options"- Options granted pursuant to Rule 2.5.
"Pregnancy" - the cessation of employment arising upon the
cessation of the right to return to work pursuant to
the provisions relating to maternity contained in
the Employment Rights Act 1996.
"Purchase Price" - the price as determined by the Board at which each
Share subject to an Option may be acquired on the
exercise of that Option provided that, subject to
Rule 6, it is not less than the nominal value of a
Share.
"Redundancy" - the cessation of employment or office by reason of
redundancy within the meaning of the Employment
Rights Act 1996.
3
<PAGE> 5
"Retirement" - the cessation of employment or office by reason
of retirement either at the Specified Age or
such other age (if later) at which an individual
is entitled to retire in accordance with the
terms of his contract of employment.
"the Rules" - the rules of the Innovex Limited 1996 Unapproved
Executive Share Option Scheme as the same may be
amended from time to time.
"Scheme" - this scheme constituted and governed by the
Rules.
"1993 Scheme" - the Innovex Holdings PLC 1993 Executive Share
Option Scheme.
"Share" - an ordinary share in the capital of the Company.
"Specified Age" - the age of 65 as regards both men and women.
"The Stock Exchange" - London Stock Exchange Limited.
"Subsisting Option" - an Option which has been granted and which has
not lapsed, been surrendered, renounced or been
exercised.
1.2 In this Scheme, except insofar as the context otherwise requires,
(i) words denoting the singular shall include the plural and vice
versa;
(ii) words importing a gender shall include every gender and references
to a person shall include bodies corporate and unincorporated and
vice versa;
(iii) reference to any enactment shall be construed as a reference to
that enactment as from time to time amended, modified, extended or
re-enacted and shall include any orders, regulations, instruments
or other sub-ordinate legislation made under the relevant
enactment.
2. Grant of Options
2.1 Options may be granted under this Scheme under the provisions of Rules
2.2 to 2.5 (inclusive) but subject to Rule 3.
2.2 At any time or times after the Adoption Date and not later than the tenth
anniversary thereof, the Board may in its absolute discretion select any
number of individuals who shall at the intended Date of Grant be Eligible
Employees and grant them Exchange Options or Nominal Value Options or
Performance Options in accordance with Rules 2.3, 2.4 or 2.5 respectively.
2.3 Exchange Options shall be granted in consideration for the release of
options granted under the 1993 Scheme provided that the Purchase Price and
the number of Shares subject to Option shall be the same as the
corresponding option granted under the 1993 Scheme.
2.4 Nominal Value Options shall be granted by deed provided that the Purchase
Price is equal to the nominal value of a Share.
4
<PAGE> 6
2.5 Performance Options shall be granted by deed provided that if the Date of
Grant is before Flotation the Purchase Price is not less than 8.52p or if
the Date of Grant is on or after Flotation the Purchase Price is not less
than the Market Value of a Share on the Date of Grant of that Option.
2.6 Options granted pursuant to Rules 2.2 to 2.5 inclusive shall be evidenced
by the issue of a certificate of option under the common seal of the
Company in each case in such form, not inconsistent with these Rules, as
the Board may from time to time determine and each of which shall, inter
alia, specify:
(i) the maximum number of Shares over which that individual has
an Option; and
(ii) the Purchase Price at which Shares may be acquired on the
exercise of the Option then granted.
2.7 Where the circumstances noted in Rule 5.6 apply Options may be granted in
consideration for the release of Options previously granted under the
Scheme. Such Options are deemed to have been granted within the terms of
the Scheme.
2.8 No Option may be transferred, assigned or charged and any purported
transfer, assignment or charge shall be void ab initio. Each option
certificate shall carry a statement to this effect. For the avoidance of
doubt, this Rule shall not prevent the Option of a deceased Option holder
being exercised by his personal representatives within the terms of these
Rules.
3. Limitations on Grants
3.1 No Exchange Option shall be granted pursuant to Rule 2.3 above if such a
grant would result in the aggregate of:
(i) the number of Shares which would remain issuable on the
exercise of Exchange Options; and
(ii) the number of Shares which have been issued pursuant to the
exercise of Exchange Options
exceeding 6,485,000 provided that the Board shall adjust the aggregate
number of Shares in each case to reflect any subsequent variation of share
capital of the Company in such manner as the Auditors confirm in writing to
be, in their opinion, fair and reasonable.
3.2 No Nominal Value Option shall be granted pursuant to Rule 2.4 above if
such a grant would result in the aggregate of:
(i) the number of Shares which would remain issuable on the
exercise of Nominal Value Options; and
(ii) the number of Shares which have been issued pursuant to the
exercise of Nominal Value Options
exceeding 1,356,697 provided that the Board shall adjust the aggregate
number of Shares in each case to reflect any subsequent variation of share
capital of the Company in such manner as the Auditors confirm in writing to
be, in their opinion, fair and reasonable.
5
<PAGE> 7
3.3 No Performance Option shall be granted pursuant to Rule 2.5 above if such
a grant would result in the aggregate of:
(i) the number of Shares which would remain issuable on the
exercise of Subsisting Options; and
(ii) the number of Shares which have been issued pursuant to the
exercise of Options
exceeding 10,721,223 provided that the Board shall adjust the aggregate
number of Shares in each case to reflect any subsequent variation of
share capital of the Company in such manner as the Auditors confirm in
writing to be, in their opinion, fair and reasonable.
For the purposes of this Rule 3.3 Shares shall include all shares in the
Company other than those shares the holders whereof have the right to a
dividend at a fixed rate but have no other right to share in the profits
of the Company, and Subsisting Options and Options shall exclude Exchange
Options and Nominal Value Options but shall include any options granted
under this Scheme or any other employee share option scheme established
by the Company or any Associated Company thereof.
3.4 Any Option granted to an Eligible Employee shall be limited and take
effect so that immediately following such grant the aggregate Purchase
Price of Shares subject to Options granted within the preceding ten years
will not exceed four times the amount of the Eligible Employee's aggregate
annual rate of earnings from the Company and any Participating Company on
the proposed Date of Grant.
For the purposes of this Rule 3.4 Options shall include Performance
Options but not Exchange Options or Nominal Value Options granted under
the Scheme and shall include options granted under any Other Executive
Scheme but may exclude Shares subject to any Option granted before
Flotation if the Board in their absolute discretion so determine.
4. Exercise of Options
4.1 Subject to Rule 7 below any Subsisting Option may be exercised by the
Option holder or, if deceased, by his personal representatives in whole or
in part at the time of or at any time following the occurrence of the
earliest of the following events:
(i) Flotation in the case of Exchange Options and Nominal Value Options
or the third anniversary of the Date of Grant in the case of
Performance Options;
(ii) the death of the Option holder;
(iii) upon the Option holder ceasing to be a director or employee of any
and all Participating Companies of which he was, prior to the
cessation, a director or employee where that cessation was by reason
of Injury, Ill Health, Disability, Pregnancy, Redundancy or
Retirement;
(iv) an opportunity to exercise the Option pursuant to Rule 5;
(v) upon the Option holder ceasing to be a director or employee of any
and all Participating Companies of which he was, prior to the
cessation, a director or employee where that cessation was by reason
either of the company or companies of which he was an Eligible
Employee ceasing to be a Participating Company or Companies or of
the office or employment relating to a business or part of a
business which is transferred to a person who cannot be a
Participating Company;
6
<PAGE> 8
(vi) subject to the discretion of the Board upon the Option holder
ceasing to be a director or employee of any and all Participating
Companies of which he was prior to the cessation a director or
employee where the cessation was other than by reason of:-
(a) a cause mentioned at 4.1(iii) or (v) above; or
(b) the Company (or any Associated Company) serving
notice on or dismissing the Option holder.
4.2 An Option shall lapse on the earliest of the following events:
(i) the seventh anniversary of the Date of Grant;
(ii) the first anniversary of the Option holder's death;
(iii) where an Option holder ceases to be a director or employee of any
and all Participating Companies of which he was, prior to such
cessation, a director or employee for any of the reasons set out in
Rule 4.1 (iii) or (v) six months following such cessation;
(iv) in the case of:
(a) an Exchange Option or Nominal Value Option, immediately
following cessation of employment where an Option holder
ceases to be a director or employee of any and all
Participating Companies of which he was, prior to cessation, a
director or employee if the employment of the Option holder is
terminated for cause and six months after such cessation if
his employment is terminated for any other reason; and
(b) a Performance Option, save in the circumstances in Rule 4.1
(ii), (iii) or (v) above, immediately following the Option
holder ceasing to be a director or employee of any and all
Participating Companies of which he was, prior to such
cessation, a director or employee except where the Board has
exercised its discretion under Rule 4.1 (vi) above in which
case the option will lapse at the end of six months following
cessation;
(v) the end of the period of exercisability determined in accordance
with Rule 5;
(vi) the Option holder being adjudicated bankrupt; and
(vii) the surrender of the Option by the Option holder.
5. Takeovers and Liquidations
5.1 If any person obtains Control of the Company as a result of making:
(i) a general offer to acquire the whole of the issued share
capital of the Company (other than that which is already owned by
him) which is unconditional or which is made on a condition such
that if it is satisfied the person making the offer will have
Control of the Company; or
(ii) a general offer to acquire all the shares (other than shares
which are already owned by him) in the Company which are of the same
class as Shares subject to a Subsisting Option
7
<PAGE> 9
then the Board shall notify all Option holders as soon as is practicable of
the offer in accordance with Rule 8.5. Any Subsisting Option may be
exercised from the date of the receipt of that notification up to the
expiry of a period ending six months from the time when the person making
the offer has obtained Control of the Company and any condition subject to
which the offer is made has been satisfied.
5.2 If the Court sanctions a compromise or arrangement under Section 425 of
the Companies Act 1985 which affects the Shares any Subsisting Option may
be exercised within six months of the Court sanctioning the compromise or
arrangement.
5.3 If any person becomes bound or entitled to acquire shares in the Company
under sections 428 to 430 of the Companies Act 1985 any Subsisting Option
may be exercised at any time when that person remains so bound or
entitled.
5.4 If the Company passes a resolution for voluntary winding up, any
Subsisting Option may be exercised within six months of the passing of the
resolution.
5.5 If any person obtains Control of the Company other than as a result of
the events specified in Rules 5.1 or 5.2 then the Board shall notify all
Option holders as soon as practicable after the change of Control in
accordance with Rule 8.5. Any Subsisting Option may be exercised from the
date of the receipt of that notification up to the expiry of a period
ending six months from the time when the person obtains Control of the
Company.
5.6 If as a result of the events specified in Rule 5.5 a company has obtained
Control of the Company, the Option holder shall, if that other company
(the "Acquiring Company") so determines, be deemed to have released any
Subsisting Option he holds in consideration for the grant of a new Option
over shares in the Acquiring Company, providing such new Option is of
equivalent value in the opinion of the Board to the Subsisting Option
being released and that such release and grant occur within the period of
six months from the Acquiring Company obtaining Control.
A new Option issued in consideration of the release of an Option shall be
evidenced by an option certificate which shall import the relevant
provisions of these Rules.
A new Option shall, for all other purposes of this Scheme, be treated as
having been acquired at the same time as the corresponding released
Option.
Where in accordance with Rule 5.6 a Subsisting Option is released and a
new Option granted, the new Option shall not be exerciseable in
accordance with Rule 5.5 above by virtue of the event on which the new
Option is granted.
5.7 The periods of exercisability under Rule 4.1(iv) and the date of lapse
under Rule 4.2(v) are those of whichever of the pre-conditions of Rules
5.1 to 5.5 (inclusive) are first achieved. The subsequent achievement of
any other pre-conditions will not cause a period of exercisability to
begin nor a date of lapse to arise.
5.8 For the purpose of this Rule 5 a person shall be deemed to have obtained
Control of a Company if he and others acting in concert with him have
together obtained Control of it.
5.9 The exercise of an Option pursuant to the preceding provisions of this
Rule 5 shall be subject to the provisions of Rule 7 below.
6. Variation of Share Capital
8
<PAGE> 10
6.1 In the event of any variation of the share capital of the Company,
including, but without prejudice to the generality of the preceding words,
any capitalisation or rights issue or any consolidation, sub-division or
reduction of capital the number of Shares subject to any Option and the
Purchase Price for each of those Shares and the numerical limits specified
in Rules 3.1 to 3.3 inclusive may be adjusted by the Board in such manner
as the Auditors confirm in writing to be, in their opinion, fair and
reasonable provided that the Purchase Price for a Share is not reduced
below its nominal value unless (and to the extent that) the Company is
authorised to capitalise from its undistributed profits or reserves upon
exercise of such Option an amount equal to the difference between the
aggregate Purchase Price and the aggregate nominal value of the Shares to
be issued upon such exercise and to apply such sum in paying up such
difference.
Such variation shall be deemed to be effective from the record date at
which the respective variation applied to other Shares of the same class.
Any Options exercised after the relevant record date shall be treated as
exercised with the benefit of the variation confirmed by the Auditors.
6.2 The Board may take such steps as it considers necessary to notify Option
holders of any adjustment made under Rule 6.1 and to call in, cancel,
endorse, issue or reissue any certificate of option consequent upon such
adjustment.
7. Manner of exercise of Options
7.1 An Option shall be exercised by the Option holder, or as the case may be
by his personal representatives, giving notice in writing, to the Company,
detailing the number of Shares in respect of which he wishes to exercise
the Option accompanied by the appropriate payment and the relevant option
certificate and shall be effective on the date of its receipt by the
Company.
7.2 The number of Shares specified in the notice of exercise given in
accordance with Rule 7.1 shall be allotted and issued to the participant
within 30 days of the date of exercise and the Company shall arrange for
the delivery of a definitive share certificate in respect thereof. Save
for any rights determined by reference to a record date preceding the date
of allotment, such Shares shall rank pari passu with the other Shares of
the same class in issue at the date of allotment.
7.3 When an Option is exercised only in part, the balance shall remain
exercisable on the same terms as originally applied to the whole Option
and a new option certificate shall be issued accordingly by the Board as
soon as possible after the partial exercise.
7.4 Where the Company's shares are:
(i) listed on The Stock Exchange, or
(ii) dealt in on the Alternative Investment Market, or
(iii) listed or quoted on any other Recognised Stock Exchange or
Recognised Investment Exchange
then no Option may be exercised in contravention of the terms of such
securities transactions rules of such body as may from time to time be in
force.
8. Administration and Amendment
9
<PAGE> 11
8.1 Subject to Rule 8.4 the Scheme shall be administered by the Board, whose
decision on all disputes shall be final saving where the Rules require the
concurrence of the Auditors.
8.2 The Board may from time to time amend these Rules provided that:
(i) no amendment may materially affect an Option holder as
regards an Option granted prior to the amendment being made; and
(ii) no amendment may be made which would make the terms on which
Options may be granted materially more generous or would increase
the limits specified in Rule 3 (except for amendments made to the
numerical limits in Rules 3.1 to 3.3 pursuant to Rule 6.1) without
the prior approval of the Company in general meeting.
8.3 The cost of establishing and operating the Scheme shall be borne by the
Participating Companies in such proportions as the Board shall determine.
8.4 The Board of the Company may establish a committee consisting of not less
than three members to which committee any or all of its powers in relation
to the Scheme may be delegated. The Board may at any time dissolve the
committee, alter its constitution or direct the manner in which it shall
act.
8.5 Any notice or other communication under or in connection with the Scheme
may be given by the Board either personally or by post, and to the Board
either personally or by post to the Secretary of the Company; items sent
by post shall be pre-paid and shall be deemed to have been received 72
hours after posting.
8.6 The Company shall at all times keep available sufficient authorised and
unissued Shares to satisfy the exercise to the full extent still possible
of all Subsisting Options, taking account of any other obligations of the
Company to issue unissued Shares.
8.7 Where the Company's shares are or become listed on The Stock Exchange,
dealt in on the Alternative Investment Market or listed or quoted on any
other Recognised Stock Exchange or Recognised Investment Exchange at any
time prior to the exercise of any Option, then the Board shall use its
best endeavours to obtain an admission or quotation, as the case may be,
for those shares issued on the subsequent exercise of an Option.
9. Headings and Captions
The headings and captions herein are provided for reference and
convenience only, shall not be considered part of the Scheme, and shall
not be employed in construction of the Scheme.
10. Miscellaneous
10.1 The rights and obligations of any individual under the terms of his
office or employment with any Participating Company shall not be affected
by his participation in the Scheme or any right which he may have to
participate therein, and an individual who participates therein shall
waive any and all rights to compensation or damages in consequence of the
termination of his office or employment for any reason whatsoever insofar
as those rights arise or may arise from his ceasing to have rights under
or be entitled to exercise any Option under the Scheme as a result of such
termination.
10.2 The existence of an Option or Options shall not affect in any way the
right or power of the Company or its shareholders to make or authorise any
or all adjustments, recapitalisation, reorganizations, reductions of
capital, purchase or redemption of its own shares pursuant to section 153
of the Companies Act 1985 or other changes in the Company's capital
structure of its business, or any merger or consolidation of the Company,
or any issue of bonds,
10
<PAGE> 12
debentures, preferred or prior preference stocks ahead of or convertible
into, or otherwise affecting the Shares or the rights thereof, or the
dissolution or liquidation of the Company, or any sale or transfer of all
or any part of its assets or business, or any other corporate act or
proceeding, whether of a similar character or otherwise.
KPMG 2 October 1996 CCK/688 R011.05
11
<PAGE> 1
EXHIBIT 5
Opinion of Smith, Anderson, Blount, Dorsett, Mitchell & Jernigan, L.L.P.
regarding the legality of securities being registered
<PAGE> 2
November 21, 1996
(919) 821-6668
Quintiles Transnational Corp.
4709 Creekstone Drive
Riverbirch Building, Suite 300
Durham, North Carolina 27703-8411
Ladies and Gentlemen:
As counsel for Quintiles Transnational Corp. (the "Company"), we
furnish the following opinion in connection with the proposed issuance
by the Company of up to 1,486,265 shares of its common stock, $0.01 par
value (the "Common Stock"), pursuant to the Quintiles Transnational
Corp. Employee Stock Purchase Plan, the Quintiles BRI Nonqualified Stock
Option Plan and the Innovex Limited Unapproved 1996 Executive Share
Option Scheme (the "Plans"). These securities are the subject of a
Registration Statement to be filed by the Company with the Securities
and Exchange Commission on Form S-8 (the "Registration Statement") under
the Securities Act of 1933, as amended (the "1933 Act"), to which this
opinion is to be attached as an exhibit.
<PAGE> 3
Quintiles Transnational Corp.
November 21, 1996
Page 2
We have examined the Restated Articles of Incorporation and Bylaws
of the Company, the minutes of meetings of its Board of Directors, and
such other corporate records of the Company and other documents and have
made such examinations of law as we have deemed relevant for purposes of
this opinion. We also have received a certificate of an officer of the
Company, dated of even date herewith, relating to the issuance of the
Common Stock pursuant to the Plans. Based on such examination and such
certificate it is our opinion that the 1,486,265 shares of Common Stock
of the Company, which are being registered pursuant to the Registration
Statement, may be legally issued in accordance with the Company's
Restated Articles of Incorporation and Bylaws, and when so issued and
duly delivered against payment therefor pursuant to the Plans as
described in the Registration Statement, such shares will be legally
issued, fully paid, and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to
the Registration Statement that you are about to file with the
Securities and Exchange Commission. Such consent shall not be deemed to
be an admission that this firm is within the category of persons whose
consent is required under Section 7 of the 1933 Act or the regulations
promulgated pursuant to the 1933 Act.
Sincerely yours,
SMITH, ANDERSON, BLOUNT, DORSETT,
MITCHELL & JERNIGAN, L.L.P.
By: /s/ Gerald F. Roach
Gerald F. Roach
<PAGE> 1
EXHIBIT 23.2
Consent of Ernst & Young LLP
<PAGE> 2
CONSENT OF ERNST & YOUNG LLP INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement
(Form S-8) pertaining to the Quintiles Transnational Corp. Employee Stock
Purchase Plan, the Quintiles BRI Nonqualified Stock Option Plan and the Innovex
Limited 1996 Unapproved Executive Share Option Scheme of our report dated
January 30, 1996, with respect to the consolidated financial statements of
Quintiles Transnational Corp. incorporated by reference in its Annual Report
(Form 10-K) for the year ended December 31, 1995 filed with the Securities and
Exchange Commission.
/s/ ERNST & YOUNG LLP
ERNST & YOUNG LLP
Raleigh, North Carolina
November 21, 1996
