Exhibit 10.8
1998 IMS HEALTH INCORPORATED REPLACEMENT PLAN
FOR CERTAIN EMPLOYEES HOLDING
COGNIZANT CORPORATION EQUITY-BASED AWARDS
1. Purpose of the Plan
The purpose of the 1998 IMS Health Incorporated Replacement Plan for
Certain Employees Holding Cognizant Corporation Equity-Based Awards (the "Plan")
is to provide for the award of substantially identical replacement stock
options, replacement limited stock appreciation rights and replacement
restricted stock to certain employees (the "Eligible Holders") of IMS Health
Incorporated (the "Company") whose awards under the 1996 Cognizant Corporation
Key Employees Stock Incentive Plan and 1996 Cognizant Corporation Replacement
Plan for Certain Employees Holding The Dun & Bradstreet Corporation Equity-Based
Awards (the "Cognizant Plans") were cancelled pursuant to the spinoff of the
Company from Cognizant Corporation ("Cognizant"). The Company expects that the
Plan will allow it to retain such employees and to motivate them to exert their
best efforts on behalf of the Company and its subsidiaries by providing
incentives through the replacement awards. The Company also expects that it will
benefit from the added interest which such employees will have in the welfare of
the Company as a result of their proprietary interest in the Company's success.
It is the intention of the Company that the terms of the replacement awards will
(i) preserve the economic value of the cancelled Cognizant awards and (ii)
except for the terms described in Sections 7, 8, 9 and 10 of this Plan, remain
substantially identical to the terms of the cancelled Cognizant awards.
2. Definitions
The following capitalized terms used in the Plan have the respective
meanings set forth in this Section:
(a) Act: The Securities Exchange Act of 1934, as amended, or any successor
thereto.
(b) Award: A replacement Option, replacement stock appreciation right or
replacement restricted stock granted pursuant to the Plan.
(c) Beneficial Owner: As such term is defined in Rule 13d-3 under the Act
(or any successor rule thereto).
(d) Board: The Board of Directors of the Company.
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(e) Change in Control: With respect to D&B Replacement Stock Options, as
defined in the 1996 Cognizant Corporation Replacement Plan for Certain
Employees Holding The Dun & Bradstreet Corporation Equity-Based
Awards. Otherwise, the occurrence of any of the following events:
(i) any Person (other than the Company, any trustee or other fiduciary
holding securities under an employee benefit plan of the Company, or
any company owned, directly or indirectly, by the stockholders of the
Company in substantially the same proportions as their ownership of
stock of the Company), becomes the Beneficial Owner, directly or
indirectly, of securities of the Company representing 20% or more of
the combined voting power of the Company's then-outstanding
securities;
(ii) during any period of twenty-four months (not including any period
prior to the Effective Date), individuals who at the beginning of such
period constitute the Board, and any new director (other than (A) a
director nominated by a Person who has entered into an agreement with
the Company to effect a transaction described in Sections 2(e)(i),
(iii) or (iv) of the Plan, (B) a director nominated by any Person
(including the Company) who publicly announces an intention to take or
to consider taking actions (including, but not limited to, an actual
or threatened proxy contest) which if consummated would constitute a
Change in Control or (C) a director nominated by any Person who is the
Beneficial Owner, directly or indirectly, of securities of the Company
representing 10% or more of the combined voting power of the Company's
securities) whose election by the Board or nomination for election by
the Company's stockholders was approved in advance by a vote of at
least two-thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or whose election
or nomination for election was previously so approved, cease for any
reason to constitute at least a majority thereof;
(iii) the stockholders of the Company approve any transaction or
series of transactions under which the Company is merged or
consolidated with any other company, other than a merger or
consolidation (A) which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into
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voting securities of the surviving entity) more than 66 2/3% of the
combined voting power of the voting securities of the Company or such
surviving entity outstanding immediately after such merger or
consolidation and (B) after which no Person holds 20% or more of the
combined voting power of the then-outstanding securities of the
Company or such surviving entity; or
(iv) the stockholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition
by the Company of all or substantially all of the Company's assets.
(f) Code: The Internal Revenue Code of 1986, as amended, or any successor
thereto.
(g) Cognizant Replacement Stock Option: A stock option granted pursuant to
Section 7 of the Plan as a replacement for a stock option previously
granted under the 1996 Cognizant Corporation Key Employees Stock
Incentive Plan.
(h) Cognizant Restricted Stock: Restricted stock held by an Eligible
Holder that was granted under the Cognizant Plans.
(i) Committee: The Compensation and Benefits Committee of the Board.
(j) Company: IMS Health Incorporated, a Delaware corporation.
(k) D&B Plans: The 1991 Key Employees Stock Option Plan for The Dun &
Bradstreet Corporation and Subsidiaries and the 1982 Key Employees
Stock Option Plan for The Dun & Bradstreet Corporation.
(l) D&B Replacement Stock Option: A stock option granted pursuant to
Section 7 of the Plan as a replacement for a stock option previously
granted under the 1996 Cognizant Corporation Replacement Plan for
Certain Employees Holding The Dun & Bradstreet Corporation
Equity-Based Awards.
(m) Daily Average Trading Price: the average of the high and low trading
prices for stock on a given day.
(n) Disability: Inability to engage in any substantial gainful activity by
reason of a medically determinable physical or mental impairment which
constitutes a permanent and total disability, as
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defined in Section 22(e)(3) of the Code (or any successor section
thereto). The determination whether an Eligible Holder has suffered a
Disability shall be made by the Committee based upon such evidence as
it deems necessary and appropriate. An Eligible Holder shall not be
considered disabled unless he or she furnishes such medical or other
evidence of the existence of the Disability as the Committee, in its
sole discretion, may require.
(o) Effective Date: The date on which the Plan takes effect, as defined
pursuant to Section 15 of the Plan.
(p) Eligible Holder: As such term is defined in Section 1 of the Plan.
(q) Fair Market Value: On a given date, the arithmetic mean of the high
and low prices of the Shares asreported on such date on the Composite
Tape of the principal national securities exchange on which such
Shares are listed or admitted to trading, or, if no Composite Tape
exists for such national securities exchange on such date, then on the
principal national securities exchange on which such Shares are listed
or admitted to trading, or, if the Shares are not listed or admitted
on a national securities exchange, the arithmetic mean of the per
Share closing bid price and per Share closing asked price on such date
as quoted on the National Association of Securities Dealers Automated
Quotation System (or such market in which such prices are regularly
quoted), or, if there is no market on which the Shares are regularly
quoted, the Fair Market Value shall be the value established by the
Committee in good faith. If no sale of Shares shall have been reported
on such Composite Tape or such national securities exchange on such
date or quoted on the National Association of Securities Dealer
Automated Quotation System on such date, then the immediately
preceding date on which sales of the Shares have been so reported or
quoted shall be used.
(r) IMS Health Restricted Stock: Restricted stock received by an Eligible
Holder as a result of the Spinoff.
(s) Option: A Cognizant Replacement Stock Option and a D&B Replacement
Stock Option.
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(t) Person: As such term is used for purposes of Section 13(d) or 14(d) of
the Act (or any successor sectionthereto).
(u) Plan: As such term is defined in Section 1 hereof.
(v) Post-Retirement Exercise Period: As such term is defined in Section
7(f) of the Plan.
(w) Shares: Shares of common stock, par value $0.01 per Share, of the
Company.
(x) Special Exercise Period: As such term is defined in Section 7(f) of
the Plan.
(y) Spinoff: the distribution of the Shares owned by Cognizant to the
holders of record of shares of Cognizant.
(z) Spinoff Date: The date on which the Spinoff was effected.
(aa) Subsidiary: A subsidiary corporation, as defined in Section 424(f) of
the Code (or any successor sectionthereto).
3. Shares Subject to the Plan
The total number of Shares which may be issued under the Plan is equal to
the aggregate number of shares subject to replacement awards, as calculated
pursuant to Sections 7(a), 8(a) and 9 of this Plan. The Shares may consist, in
whole or in part, of unissued shares or treasury shares. Issuance of Shares upon
exercise of an option or reduction of the number of Shares subject to an option
upon exercise of a stock appreciation right shall reduce the total number of
Shares available under the Plan. In addition, Shares which are subject to
unexercised stock options which terminate or lapse may not be optioned again
under the Plan.
4. Administration
The Plan shall be administered by the Committee, which may delegate its
duties and powers in whole or in part to any subcommittee thereof consisting
solely of at least two individuals who are each "non-employee directors" within
the meaning of Rule 16b-3 under the Act (or any successor rule thereto) and
"outside directors" within the meaning of Section 162(m) of the Code (or any
successor section thereto). The Committee is authorized to interpret the Plan,
to establish, amend and rescind any rules and regulations relating to the Plan,
and to make any other determinations that it deems necessary or desirable for
the administration of the Plan. The Committee may
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correct any defect or supply any omission or reconcile any inconsistency in the
Plan in the manner and to the extent the Committee deems necessary or desirable.
Any decision of the Committee in the interpretation and administration of the
Plan, as described herein, shall lie within its sole and absolute discretion and
shall be final, conclusive and binding on all parties concerned (including, but
not limited to, Eligible Holders and their beneficiaries or successors). The
Committee shall require payment of any amount it may determine to be necessary
to withhold for federal, state, local or other taxes as a result of the exercise
of an Award. Unless the Committee specifies otherwise, the Eligible Holder may
elect to pay a portion or all of such withholding taxes by (a) delivery in
Shares or (b) having Shares withheld by the Company from any Shares that would
have otherwise been received by the Eligible Holder. The number of Shares so
delivered or withheld shall have an aggregate Fair Market Value sufficient to
satisfy the applicable withholding taxes.
5. Eligibility
Only Eligible Holders shall receive grants of replacement stock options,
replacement stock appreciation rights and replacement restricted stock under the
Plan. The granting of a stock option, stock appreciation right or restricted
stock under the Plan shall impose no obligation on the Company or any Subsidiary
to continue the employment of an Eligible Holder and shall not lessen or affect
the right to terminate the employment of such Eligible Holder.
6. Limitations
Options hereunder shall only be granted in replacement of Cognizant Stock
Options (as defined in Section 7(a) of the Plan) held by Eligible Holders
immediately prior to the Spinoff Date.
7. Terms and Conditions of Options
Stock options granted under the Plan shall be non-qualified, and shall be
subject to the foregoing and the following terms and conditions and to such
other terms and conditions, not inconsistent therewith, as the Committee shall
determine:
(a) Generally. As of the Spinoff Date, each unexercised stock option
held by an Eligible Holder that was granted under the Cognizant Plans (a
"Cognizant Stock Option") shall be cancelled, and such Eligible Holder
shall receive a replacement stock option pursuant to this Plan. The number
of Shares covered by each replacement stock option shall be determined by
(i) multiplying the number of shares of Cognizant common stock covered by
the cancelled Cognizant Stock Option by a
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fraction, the numerator of which is the average of the Daily Average
Trading Prices of Cognizant common stock for the five consecutive trading
days immediately preceding the first date on which Cognizant common stock
is traded ex-dividend, and the denominator of which is the average of the
Daily Average Trading Prices of the Shares for the five consecutive trading
days starting on the first date on which the Shares are traded regular way
(the "IMS Health Ratio") and (ii) rounding down the result to a whole
number of shares. The option price of each replacement stock option shall
be determined by dividing the option price of the cancelled Cognizant Stock
Option by the IMS Health Ratio. Unless otherwise specified in this Plan,
all other terms of the replacement stock options shall remain substantially
identical to those of the cancelled Cognizant Stock Options as set forth in
the applicable Cognizant Plan and related option agreement(s).
(b) Exercisability. Except as set forth in the Plan, stock options
granted under the Plan shall have substantially identical terms as those of
the stock options originally granted under the Cognizant Plans; provided,
however, that in no event shall a replacement stock option be exercisable
more than ten years after the date the original option was granted under
the Cognizant Plans.
(c) Exercise of Options. Except as otherwise provided in the Plan or
in an Award agreement, an Option may be exercised for all, or from time to
time any part, of the Shares for which it is then exercisable. For purposes
of Section 7 of the Plan, the exercise date of an Option shall be the later
of the date a notice of exercise is received by the Company and, if
applicable, (A) the date payment is received by the Company pursuant to
clauses (i), (ii) or (iii) in the following sentence or (B) the date of
sale by a broker of all or a portion of the Shares being purchased pursuant
to clause (iv) in the following sentence. The purchase price for the Shares
as to which an Option is exercised shall be paid to the Company in full at
the time of exercise at the election of the Eligible Holder (i) in cash,
(ii) in Shares having a Fair Market Value equal to the aggregate option
price for the Shares being purchased and satisfying such other requirements
as may be imposed by the Committee, (iii) partly in cash and partly in such
Shares or (iv) through the delivery of irrevocable instructions to a broker
to deliver promptly to the Company an amount equal to the aggregate option
price for the Shares being purchased. No Eligible Holder shall have any
rights to dividends or other rights of a stockholder with respect to Shares
subject to an Option until the Eligible Holder has given written notice of
exercise of the Option, paid in full for such Shares and, if applicable,
has satisfied any other conditions imposed by the Committee pursuant to the
Plan.
(d) Exercisability of a Cognizant Replacement Stock Option Upon
Termination of Employment by Death or Disability. If an Eligible Holder's
employment with the Company and its Subsidiaries terminates by reason of
death or Disability after
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the date of grant of a Cognizant Replacement Stock Option, (i) the
unexercised portion of such option shall immediately vest in full and (ii)
such portion may thereafter be exercised during the shorter of (A) the
remaining stated term of such option or (B) five years after the date of
death or Disability.
(e) Exercisability of a D&B Replacement Stock Option Upon Termination
of Employment by Death. If an optionee's employment by the Company or a
subsidiary terminates by reason of death one year or more after the date of
grant of the original stock option under the D&B Plans, the D&B Replacement
Stock Option thereafter may be exercised, during the three years after the
date of death or the remaining stated period of such option, whichever
period is shorter, to the extent to which such option was exercisable at
the time of death or thereafter would become exercisable during the
three-year period after the date of death in accordance with its terms.
(f) Exercisability of a Cognizant Replacement Stock Option Upon
Termination of Employment by Retirement. If an Eligible Holder's employment
with the Company and its Subsidiaries terminates by reason of Retirement
after the date of grant of a Cognizant Replacement Stock Option, an
unexercised Cognizant Replacement Stock Option may thereafter be exercised
during the shorter of (i) the remaining stated term of such option or (ii)
five years after the date of such termination of employment (the
"Post-Retirement Exercise Period"), but only to the extent to which such
option was exercisable at the time of such termination of employment or
becomes exercisable during the Post-Retirement Exercise Period; provided,
however, that if an Eligible Holder dies within a period of five years
after such termination of employment, an unexercised Cognizant Replacement
Stock Option may thereafter be exercised, during the shorter of (i) the
remaining stated term of such option or (ii) the period that is the longer
of (A) five years after the date of such termination of employment or (B)
one year after the date of death (the "Special Exercise Period"), but only
to the extent to which such option was exercisable at the time of such
termination of employment or becomes exercisable during the Special
Exercise Period. For purposes of this Section 7(f), "Retirement" shall mean
termination of employment with the Company or a Subsidiary after such
Eligible Holder has attained age 55 and five years of service with the
Company; or, with the prior written consent of the Committee that such
termination be treated as a Retirement hereunder, termination of employment
under other circumstances.
(g) Exercisability of a D&B Replacement Stock Option Upon Termination
of Employment by Disability or Retirement. If an optionee's employment by
the Company or a subsidiary terminates by reason of Disability or
Retirement one year or more after the date of grant of the original stock
option under the D&B Plans, the D&B Replacement Stock Option thereafter may
be exercised, during the five years after the date of such termination of
employment or the remaining stated period of such
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option, whichever period is shorter, to the extent to which such option was
exercisable at the time of such termination of employment or thereafter
would become exercisable during such period in accordance with its terms;
provided, however, that if the optionee dies within a period of five years
after such termination of employment, any unexercised stock option may be
exercised thereafter, during either (1) the period ending on the later of
(i) five years after such termination of employment and (ii) one year after
the date of death or (2) the period remaining in the stated term of the
option, whichever period is shorter, to the extent to which such option was
exercisable at the time of death or thereafter would become exercisable
during the remainder of the five-year period after such termination of
employment in accordance with its terms. For purposes of this Section 7(f),
"Retirement" shall mean termination of employment with the Company or a
subsidiary after the optionee has attained age 55 and completed ten or more
years of employment with D&B and/or the Company; or after the optionee has
attained age 65, regardless of the length of such optionee's employment
with D&B and/or the Company.
(h) Effect of Other Termination of Employment. If an Eligible Holder's
employment with the Company and its Subsidiaries terminates for any reason
other than death, Disability or Retirement after the date of grant of an
Option as described above, an unexercised Cognizant Replacement Stock
Option may thereafter be exercised during the period ending 90 days after
the date of such termination of employment, but only to the extent to which
such Option was exercisable at the time of such termination of employment.
If an Eligible Holder's employment terminates for any reason, other than
Disability, death or Retirement one year or more after the date of grant of
the original stock option under the D&B Plans as described above, each D&B
Replacement Stock Option held by such Eligible Holder shall thereupon
terminate. Notwithstanding the foregoing, the Committee may, in its sole
discretion, accelerate the vesting of unvested Cognizant Replacement Stock
Options held by an Eligible Holder if such Eligible Holder is terminated
from employment without "cause" (as such term is defined by the Committee
in its sole discretion) by the Company.
8. Terms and Conditions of Stock Appreciation Rights
Stock appreciation rights (including limited stock appreciation rights)
granted under the Plan shall be subject to the foregoing and the following terms
and conditions and to such other terms and conditions, not inconsistent
therewith, as the Committee shall determine:
(a) Replacement Stock Appreciation Rights. As of the Spinoff Date,
each unexercised stock appreciation right (including a limited stock
appreciation right) held by an Eligible Holder that was granted under the
Cognizant Plans (a "Cognizant SAR") shall be cancelled, and such Eligible
Holder
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shall receive a replacement stock appreciation right pursuant to this Plan.
The number of Company stock appreciation rights covered by each replacement
stock appreciation right shall be determined by (i) multiplying the number
of Cognizant Stock Options covered by the cancelled Cognizant SAR by the
IMS Health Ratio and (ii) rounding down the result to a whole number of
stock appreciation rights. The exercise price of each replacement stock
appreciation right shall be determined by dividing the exercise price of
the cancelled Cognizant SAR by the IMS Health Ratio. Unless otherwise
specified in this Plan, all other terms of the replacement stock
appreciation rights shall remain substantially identical to those of the
cancelled Cognizant SARs as set forth in the applicable Cognizant Plans and
related Cognizant SAR agreement(s).
(b) Terms. Stock appreciation rights shall cover the same Shares
covered by a related option (or such lesser number of Shares as the
Committee may determine) and shall be subject to the same terms and
conditions as the option except for such additional limitations as are
contemplated by this Paragraph 8 (or as may be included in a stock
appreciation right granted hereunder). Each stock appreciation right shall
entitle an optionee to surrender to the Company an unexercised option, or
any portion thereof, and to receive from the Company in exchange therefor
an amount equal to the excess of the fair market value on the exercise date
of one Share over the option price per share times the number of Shares
covered by the option, or portion thereof, which is surrendered. The date a
notice of exercise is received by the Company shall be the exercise date.
Payment shall be made in Shares or in cash, or partly in shares and partly
in cash, valued at such fair market value, all as shall be determined by
the Committee. Stock appreciation rights may be exercised from time to time
upon actual receipt by the Company of written notice of exercise stating
the number of Shares subject to an exercisable option with respect to which
the stock appreciation right is being exercised. No fractional Shares will
be issued in payment for stock appreciation rights, but instead cash will
be paid for a fraction or, if the Committee should so determine, the number
of Shares will be rounded downward to the next whole share.
(c) Limitations on Exercisability. The Committee shall impose such
conditions upon the exercisability of stock appreciation rights as will
result, except upon the occurrence of an event contemplated by replacement
limited stock appreciation rights granted pursuant to this Paragraph 8 or
contemplated by the provisions of Paragraph 10, in the amount to be charged
against the Company's consolidated income by reason of stock appreciation
rights not to exceed, in any one calendar year, two percent of the
Company's prior calendar year's consolidated income before income taxes.
The Committee also may impose, in its discretion, such other conditions
upon the exercisability of stock appreciation rights as it may deem fit.
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(d) Replacement Limited Stock Appreciation Rights. The Committee shall
grant replacement limited stock appreciation rights in substantially the
same manner in which replacement stock appreciation rights are awarded
pursuant to this Section 8 of the Plan. Unless the context otherwise
requires, whenever the term "stock appreciation right" is used in the Plan,
such term shall include limited stock appreciation rights.
9. Terms and Conditions of Restricted Stock
As of the Spinoff Date, Cognizant Restricted Stock and IMS Health
Restricted Stock held by an Eligible Holder shall be forfeited, and such
Eligible Holder shall receive replacement restricted stock pursuant to this
Plan. The number of shares of restricted stock shall equal (i) the number of
Shares of forfeited IMS Health Restricted Stock plus (ii) the number of shares
of forfeited Cognizant Restricted Stock multiplied by a fraction, the numerator
of which is the average of the Daily Average Trading Prices of Cognizant common
stock for the five consecutive trading days starting on the ex-dividend trading
date, and the denominator of which is the average of the Daily Average Trading
Prices of the Shares for the five consecutive trading days starting on the first
date on which the Shares are traded regular way. Unless otherwise specified in
this Plan, all other terms of the replacement restricted stock shall remain
substantially identical to those of the forfeited Cognizant Restricted Stock as
set forth in the applicable Cognizant Plans and related Cognizant Restricted
Stock agreement(s).
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Adjustments Upon Certain Events
Notwithstanding any other provisions in the Plan to the contrary, the
following provisions shall apply to all Awards granted under the Plan:
(a) Generally. In the event of any change in the outstanding Shares
after the Effective Date by reason of any Share dividend or split,
reorganization, recapitalization, merger, consolidation, spin-off,
combination or exchange of Shares or other corporate exchange, or any
distribution to stockholders of Shares other than regular cash dividends,
the Committee in its sole discretion and without liability to any person
may make such substitution or adjustment, if any, as it deems to be
equitable, as to (i) the number or kind of Shares or other securities
issued or reserved for issuance pursuant to the Plan or pursuant to
outstanding Awards, (ii) the option price and/or (iii) any other affected
terms of such Awards.
(b) Change in Control. Except as otherwise provided in an Award
agreement or, with respect to D&B Replacement Options in the 1996 Cognizant
Corporation Replacement Plan for Certain Employees Holding The Dun &
Bradstreet Corporation Equity-Based Awards, in the event of a Change in
Control, the Committee in its sole discretion and without liability to any
person may take such actions, if any, as it deems necessary or desirable
with respect to any Award (including, without limitation, (i) the
acceleration of an Award, (ii) the payment of a cash amount in exchange for
the cancellation of an Award and/or (iii) the requiring of the issuance of
substitute Awards that will substantially preserve the value, rights and
benefits of any affected Awards previously granted hereunder) as of the
date of the consummation of the Change in Control.
11. Successors and Assigns
The Plan shall be binding on all successors and assigns of the Company and
an Eligible Holder, including without limitation, the estate of such Eligible
Holder and the executor, administrator or trustee of such estate, or any
receiver or trustee in bankruptcy or representative of the Eligible Holder's
creditors.
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Nontransferability of Awards
An Award shall not be transferable or assignable by the Eligible Holder
otherwise than by will or by the laws of descent and distribution. During the
lifetime of an Eligible Holder, an Award shall be exercisable only by such
Eligible Holder. An Award exercisable after the death of an Eligible Holder may
be exercised by the legatees, personal representatives or distributees of the
Eligible Holder. Notwithstanding anything to the contrary herein, the Committee,
in its sole discretion, shall have the authority to waive this Section 12 (or
any part thereof) to the extent that this Section 12 (or any part thereof) is
not required under the rules promulgated under any law, rule or regulation
applicable to the Company.
13. Amendments or Termination
The Board may amend, alter or discontinue the Plan, but no amendment,
alteration or discontinuation shall be made which, (a) without the approval of
the stockholders of the Company, would (except as is provided in Section 10 of
the Plan), increase the total number of Shares reserved for the purposes of the
Plan or change the maximum number of Shares for which Awards may be granted to
any Eligible Holder or (b) without the consent of an Eligible Holder, would
impair any of the rights or obligations under any Award theretofore granted to
such Eligible Holder under the Plan. Notwithstanding anything to the contrary
herein, the Board may not amend, alter or discontinue the provisions relating to
Section 10(b) of the Plan after the occurrence of a Change in Control.
14. International Eligible Holders
With respect to Eligible Holders who reside or work outside the United
States of America and who are not (and who are not expected to be) "covered
employees" within the meaning of Section 162(m) of the Code, the Committee may,
in its sole discretion, amend the terms of the Plan or Awards with respect to
such Eligible Holders in order to conform such terms with the requirements of
local law.
15. Choice of 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 the
State of New York.
16. Effectiveness of the Plan
The Plan shall be effective as of the Spinoff Date.