Exhibit 10.86
PHARMACEUTICAL PRODUCT
DEVELOPMENT, INC.
EMPLOYEE STOCK PURCHASE
PLAN
THIS INSTRUMENT is executed as of
the 1 st day of March, 2005 by
PHARMACEUTICAL PRODUCT DEVELOPMENT, INC., a North Carolina
corporation (the “Company”).
Statement of
Purpose
The Company sponsors the
Pharmaceutical Product Development, Inc. Employee Stock Purchase
Plan (the “Plan”) in order to provide eligible
employees with the opportunity to purchase shares of the common
stock of the Company and to thereby share in the continued growth
and success of the Company. The Company is hereby amending and
restating the Plan effective with the Offering Period under the
Plan commencing July 1, 2005 to (i) incorporate the provisions of
prior amendments into a single document, (ii) change the method for
determining the purchase price of shares under the Plan to cause
the Plan to be treated as a noncompensatory plan under the
Financial Accounting Standards Board Statement No. 123(R)
Share-Based Payment, as revised in 2004, and (iii) otherwise meet
current needs.
NOW, THEREFORE, for the purposes
aforesaid, the Company hereby amends and restates the Plan
effective with the Offering Period under the Plan commencing July
1, 2005 to consist of the following Articles I through
VIII:
ARTICLE I
NAME, PURPOSE, CONSTRUCTION AND
DEFINITIONS
Section 1.1. Name . The Plan
shall be known as the “Pharmaceutical Product Development,
Inc. Employee Stock Purchase Plan.”
Section 1.2. Purpose . The
purpose of the Plan is to provide Participants in the Plan with an
opportunity to purchase Common Stock in the Company through payroll
deductions and other contributions, thereby encouraging
Participants to share in the economic growth and success of the
Company through stock ownership.
Section 1.3. Construction .
Article, Section and paragraph headings have been inserted in the
Plan for convenience of reference only and are to be ignored in any
construction of the provisions hereof. If any provision of the Plan
shall be invalid or unenforceable the remaining
provisions shall nevertheless be valid,
enforceable and fully effective. It is the intent that the Plan
shall at all times constitute an “employee stock purchase
plan” within the meaning of Section 423(b) of the Code, and
the Plan shall be construed and interpreted to remain such. The
Plan shall be construed, administered, regulated and governed by
the laws of the United States to the extent applicable, and to the
extent such laws are not applicable, by the laws of the State of
North Carolina.
Section 1.4. Definitions .
Whenever used in the Plan, unless the context clearly indicates
otherwise, the following terms shall have the following
meanings:
(a) Beneficiary , with
respect to a Participant, means such Participant’s
“Beneficiary” under the group term life insurance plan
maintained by the Company.
(b) Board or Board of
Directors means the Board of Directors of the Company or any
Committee or Committees of said Board of Directors of the Company
to which, and to the extent, said Board of Directors of the Company
has delegated some or all of its power, authority, duties or
responsibilities with respect to the Plan.
(c) Code means the Internal
Revenue Code of 1986, as the same may be amended from time to time,
and references thereto shall include the valid Treasury regulations
issued thereunder.
(d) Committee means the
“Committee” as defined under the Retirement Savings
Plan which is responsible for the administration of the Plan in
accordance with Article VI hereof.
(e) Common Stock means shares
of the $0.10 par value common stock of the Company and any other
stock or securities resulting from the adjustment thereof or
substitution therefor as described in Section 3.4.
(f) Company means
Pharmaceutical Product Development, Inc., a North Carolina
corporation.
(g) Compensation means
“Contribution Compensation” as defined under the
Retirement Savings Plan, except that Compensation under the Plan
shall not be limited by Section 401(a)(17) of the Code.
(h) Effective Date means July
1, 1997.
(i) Employee means a person
employed by the Company. In addition, the employees of the
Company’s subsidiaries which the Company designates in its
sole and exclusive discretion as participating subsidiaries for
purposes of this Plan shall also be considered Employees for
purposes of this Plan.
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(j) Fair Market Value , with
respect to a share of Common Stock from time to time, means (i) if
the Common Stock is traded on the National Market System, the
closing price of the Common Stock for the applicable date, as
published in the NASDAQ National Market Issues report in the
Eastern Edition of The Wall Street
Journal , (ii) if the Common Stock is not traded on the
National Market System but such Common Stock is listed on a
national securities exchange, the mean between the highest price
and the lowest price at which the Common Stock shall have been sold
regular way on a national securities exchange on the applicable
date during an Offering Period or, if there are no sales on said
date, then on the next preceding date on which there were sales of
Common Stock, (iii) if the Common Stock is not traded on the
National Market System or listed on a national securities exchange,
the mean between the bid and asked prices last reported by the
National Association of Securities Dealers, Inc. for the
over-the-counter market on the applicable date during an Offering
Period or, if no bid and asked prices are reported on said date,
then on the next preceding date on which there were such
quotations, or (iv) if the Common Stock is not traded on the
National Market System or listed on a national securities exchange
and quotations for the Common Stock are not reported by the
National Association of Securities Dealers, Inc., the fair market
value determined by the Committee on the basis of available prices
for the Common Stock or in such manner as the Committee shall
agree.
(k) Offering means the
offering of shares of Common Stock to Participants pursuant to this
Plan that occurs on each Offering Date.
(l) Offering Date means July
1, 1997 and each succeeding January 1 and July 1.
(m) Offering Period means the
period from an Offering Date through the immediately succeeding
Offering Date.
(n) Participant means an
Employee who has become a Participant pursuant to Section 2.2 of
the Plan.
(o) Plan means the
Pharmaceutical Product Development, Inc. Employee Stock Purchase
Plan, as set forth herein, together with any and all amendments
thereto.
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(p) Retirement Savings Plan
means The Pharmaceutical Product Development, Inc. Retirement
Savings Plan as in effect from time to time.
(q) Stock Purchase Account ,
with respect to a Participant, means the account established on the
books and records of the Company for such Participant representing
the payroll deductions credited to such account in accordance with
the provisions of the Plan.
ARTICLE II
PARTICIPATION
Section 2.1. General . No
person shall become a Participant unless or until such person is or
becomes an Employee and upon or following satisfaction of the
eligibility requirement set forth in the Plan. In addition, in no
event shall any person be eligible to participate in the Plan
before the Effective Date.
Section 2.2. Participation
Requirements .
(a) Eligibility Requirement .
An Employee shall satisfy the eligibility requirement for the Plan
on the date the Employee is first employed by the Company, subject
to the provisions of Section 2.2(c) below.
(b) Commencement of
Participation . Each person who satisfies the eligibility
requirement of Section 2.2(a) on or before the Effective Date shall
become a Participant in the Plan:
(1) on the Offering Date coinciding
with the Effective Date, if such person is an Employee on such
Offering Date; or
(2) if such person is not an
Employee on such Offering Date, then on the first Offering Date
coinciding with or next following the date (if any) on which such
person again becomes an Employee after the Effective
Date.
Each person who satisfies the eligibility
requirement of Section 2.2(a) after the Effective Date shall become
a Participant in the Plan:
(1) on the first Offering Date after
such person satisfies the eligibility requirement, if such person
is an Employee on such Offering Date; or
(2) if such person is not an
Employee on such Offering Date, then on the first Offering Date
coinciding with or next following the date (if any) on which such
person again becomes an Employee.
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(c) Exclusions .
Notwithstanding any provision of the Plan to the contrary, in no
event shall the following persons be eligible to participate in the
Plan:
(1) Any Employee whose customary
employment with the Company is twenty (20) hours or less per week;
or
(2) Any Employee whose customary
employment with the Company is for not more than five (5) months in
any calendar year.
Section 2.3. Eligibility of
Former Participants . If a person terminates employment with
the Company after becoming a Participant and subsequently resumes
employment with the Company, such person shall again become a
Participant on the Offering Date coinciding with or next following
such resumption of employment with the Company without having to
satisfy again the eligibility requirement of Section
2.2(a).
ARTICLE III
OFFERING OF COMMON
STOCK
Section 3.1. Reservation of
Common Stock . The Board of Directors has reserved one million
two-hundred fifty thousand (1,250,000) shares of Common Stock for
the Plan, subject to adjustment in accordance with Section 3.4. The
aggregate number of shares of Common Stock which may be purchased
under the Plan by Participants shall not exceed one million
two-hundred fifty thousand (1,250,000) shares, subject to
adjustment in accordance with Section 3.4.
Section 3.2. Offering of Common
Stock .
(a) General . Subject to
Section 3.2(b), each Participant in the Plan on an Offering Date
shall be entitled to purchase shares of Common Stock on the last
day of the Offering Period beginning with such Offering Date with
the amounts deducted from such Participant’s Compensation or
otherwise contributed during such Offering Period pursuant to
Article IV. The purchase price for such shares of Common Stock
shall be determined under Section 3.3.
(b) Limitations .
Notwithstanding Section 3.2(a), the maximum number of shares of
Common Stock a Participant may purchase pursuant to an Offering
under Section 3.2(a) shall be subject to the following
limitations:
(1) If as of the Offering Date for
such Offering such Participant owns (including stock which such
Participant is considered to own under Section 425(d) of the Code)
stock (including the Common Stock such Participant would be
entitled to purchase pursuant to an Offering) possessing five
percent (5%) or more of the total combined voting power or value of
all classes of stock of the Company, then the maximum number of
shares of Common Stock such Participant may purchase pursuant to
such Offering
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shall be reduced so that the number
of shares of Common Stock such Participant may purchase pursuant to
such Offering when added to the number of shares of stock of the
Company such Participant owns (including stock which such
Participant is considered to own under Section 425(d) of the Code)
(excluding the Common Stock such Participant would be entitled to
purchase pursuant to such Offering) is less than f
