EXHIBIT 10.43
SCHEIN PHARMACEUTICAL, INC.
DEFERRED COMPENSATION AGREEMENT
Dated November 22, 1993
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The parties to this agreement are Schein Pharmaceutical, Inc. (the
"Company") and Xxx Xxxxxx (the "Employee").
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The Company and its subsidiaries wish to obtain the continuing benefit
of the Employee's services after an Equity Investor Transaction (as defined in
section 1). The purpose of this agreement is to enable the Company and its
subsidiaries to motivate the Employee to remain with the Company after an Equity
Investor Transaction by providing additional cash compensation to the Employee.
The parties agree as follows:
1. Deferred Compensation. Subject to the provisions of this
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agreement, the Company shall pay the Employee a bonus of $250,000 (the "Deferred
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Compensation Amount"), payable as provided herein. The Company shall pay the
employee, not later than thirty days after the applicable anniversary date, an
amount equal to (a) 50% of the Deferred Compensation Amount after the second
anniversary of an Equity Investor Transaction, (b) an additional 25% of the
Deferred Compensation Amount after the third anniversary of an Equity Investor
Transaction, and (c) an additional 25% of the Deferred Compensation Amount after
the fourth anniversary of an Equity Investor Transaction, provided the Employee
is in the employ of the Company or any of its subsidiaries at each such
anniversary date. Notwithstanding the foregoing, however, if the Employee's
employment with the Company and each of its subsidiaries terminates at any time
before the Final Date,
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the amount, if any, payable to the Employee, and the time any such amount shall
be payable, shall be determined under section 2 of this agreement. As used in
this agreement, (a) the term "Final Date" means the fourth anniversary of the
consummation of the Equity Investor Transaction, and (b) the term "Equity
Investor Transaction" means a transaction (or series of transactions) resulting
in the stockholders (or beneficiaries of any such stockholders which are trusts)
of Schein Holdings, Inc., a New York corporation of which SPINC is a subsidiary,
receiving after November 1, 1993 and prior to December 31, 1994 not less than
$200 million in the aggregate in respect of the disposition of shares of Schein
Holdings, Inc., by cash dividend or otherwise. All payments under this agreement
shall be subject to applicable federal, state and local withholdings.
2. Termination of Employment.
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2.1 General. In the event of a termination of the Employee's
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employment by the Company and each of its subsidiaries for any reason including,
without limitation, death or Disability (as defined below), other than a
termination for Cause (as defined in section 2.2) or voluntary termination in
accordance with section 2.3, the Company shall pay the Employee (or his or her
estate), not later than thirty days following the termination of employment, the
Deferred Compensation Amount. As used in this agreement, the term "Disability"
means a permanent disability, as determined by the board of directors of the
Company in its sole discretion. A Disability shall be deemed to occur at the
time of that determination by the board of directors.
2.2 Cause. If the Company or any of its subsidiaries terminates
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the Employee's employment for Cause, or the Employee terminates his or her
employment in
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violation of an agreement with the Company or any of its subsidiaries, or if it
is discovered after such termination of employment that the Employee had engaged
in conduct that would have justified termination if employment for Cause, the
Company shall have no obligation to pay any amount under this agreement. As used
in this agreement, termination of employment for "Cause" means (a) the
Employee's wilful and continued failure substantially to perform his or her
duties with the Company and its subsidiaries, (b) fraud, misappropriation or
intentional material damage to the property or business of the Company or any of
its subsidiaries or (c) commission of a felony.
2.3 Voluntary Termination. If the Employee voluntarily
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terminates his or her employment with the Company and each of its subsidiaries
before the second anniversary of an Equity Investor Transaction, the Company
shall have no obligation to pay any amount under this agreement. If the Employee
voluntarily terminates his or her employment with the Company and each of its
subsidiaries thereafter, the Company shall pay the Employee, not later than
thirty days after the applicable anniversary date, an amount equal to (a) 50% of
the Deferred Compensation Amount if the termination of employment occurs after
the second anniversary, but before the third anniversary, of the consummation of
an Equity Investor Transaction, (b) an additional 25% of the Deferred
Compensation Amount if the termination of employment occurs after the third
anniversary of the consummation of an Equity Investor Transaction, but before
the Final Date, and (c) an additional 25% of the Deferred Compensation if the
termination of employment occurs after the Final Date.
3. General Provisions
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3.1 Right to Terminate Employment. Notwithstanding anything to
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the contrary in this agreement, nothing in this agreement shall be deemed to
impose any obligation on the Company or any of its subsidiaries to continue the
employment of the Employee, or on the Employee to remain in the employ of the
Company or any of its subsidiaries, subject, however, to the provisions of any
other agreement between the Company or any of its subsidiaries and the Employee.
3.2 Payment not Salary. Any deferred compensation payable under
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this agreement shall not be deemed salary or other compensation to the Employee
for the purposes of computing benefits to which he or she may be entitled under
any pension plan or other arrangement of the Company or an affiliate of the
Company for the benefit of its employees.
3.3 Notices. Any notice or communication under this agreement
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shall be in writing and shall be deemed to have been duly given when delivered
in person, or by United States mail, to the appropriate party at the address set
forth below (or such other address as the party shall from time to time
specify):
If to the Company, to:
Schein Pharmaceutical, Inc.
000 Xxxxxx Xxxxx
Xxxxxxx Xxxx, Xxx Xxxxxx 00000
Attention: Corporate Secretary
If to the Employee, to:
the address indicated on the signature page at the end of this
agreement.
3.4 Severability of Provisions. If any provision of this
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agreement shall be held invalid or unenforceable, such invalidity or
unenforceability shall not affect any other
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provisions of this agreement and this agreement shall be construed and enforced
as if such provisions had not been included.
3.5 Headings and Captions. The headings and captions under this
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agreement are provided for reference and convenience only. They shall not be
considered part of this agreement and shall not be employed in the construction
of this agreement.
3.6 Controlling Law. This agreement shall be construed and
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enforced according to the law of the state of New York applicable to agreements
made and to be performed wholly in New York.
3.7 Counterparts. This agreement may be executed in
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counterparts, each of which shall be considered an original, but both of which
together shall constitute the same instrument.
3.8 Entire Agreement. This agreement contains a complete
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statement of all the arrangements between the parties with respect to its
subject matter, supersedes all existing agreements between them with respect to
that subject matter may not be changed or terminated orally and any amendment or
modification must be in writing and signed by the parties to this agreement.
SCHEIN PHARMACEUTICAL, INC.
By: [SIGNATURE ILLEGIBLE]
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Authorized Officer
/s/ Xxx Xxxxxx
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Xxx Xxxxxx
00 Xxxx Xxxxxxx Xxxxx
Xxx Xxxxxxxxx, XX 00000
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