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OMNICARE, INC.
EXECUTIVE SALARY PROTECTION AGREEMENT
This Agreement is made and entered into as of July 1, 1981, by and
between Omnicare, Inc., a Delaware corporation (hereinafter sometimes referred
to as the "Company"), and Xxxx X. Xxxxxxxx (hereinafter referred to as
"Employee").
In consideration of the past and future services of the Employee, it
is hereby mutually agreed as follows:
SECTION 1 - PAYMENT OF DEATH BENEFITS
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(a) If Employee dies (from causes other than suicide within two
years from the date hereof) while an active employee of the Company or a
Subsidiary before reaching age 65, the Company, or the Subsidiary by which the
Employee is employed, will pay to Employee's beneficiary (as defined herein),
as a death benefit, the percentages of his Recognized Compensation (as stated
in Schedule A attached hereto) for the number of months set forth below:
(i) 100% of Employee's Recognized Compensation for the first
twelve (12) months following death;
(ii) 50% of Employee's Recognized Compensation for the next one
hundred eight (108) months provided that, in the event the Employee
dies at age 56 or thereafter, the payments referred to in this
sub-paragraph (ii) shall continue for the following periods:
Age at Death Number of Monthly Payments
56 96
57 84
58 72
59 60
60 48
61 48
62 48
63 48
64 48
(b) As used herein the term "Beneficiary" of Employee shall mean
the person or persons (which may include, without limitation, the Employee's
estate or one or more trusts or other entities) designated by Employee in a
"Designation of Beneficiary" filed with the Company. Such "Designation of
Beneficiary" shall be in such form as the Committee may from time to time
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prescribe or accept. Employee may at any time change any such Designation of
Beneficiary by filing a new form with the Company. If Employee has not made
any such designation, or if any such designation shall not be effective,
"Beneficiary" shall mean the Employee's estate or other person or persons
entitled to receive the payments herein provided for under the laws of testate
or intestate succession, as the case may be. In the event the Company has any
doubt as to the proper person or persons entitled to receive payments due
hereunder, the Company shall have the right to withhold such payments until the
matter is decided by a court of competent jurisdiction.
(c) In the event the Federal tax laws and regulations applicable
to the payments herein provided for or to any life insurance the Company may
take on Employee's life pursuant to Section 5 of the Company's Executive Salary
Protection Plan ("ESP Plan") are hereafter changed or interpreted so as to
increase the presently anticipated aftertax cost to the Company of the payments
herein provided for, the Company may, in accordance with such procedures as
shall be approved by the Committee, reduce the payments herein provided for
commensurately.
SECTION 2 - TERMINATIONS
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(a) All rights of Employee hereunder shall terminate upon his
reaching age 65 or thirty (30) days following the date upon which he retires or
otherwise (except by reason of death) ceases to be an active employee of the
Company or a Subsidiary, whichever is earlier. Neither a leave of absence (if
approved by the Committee) nor a cessation of employment by reason of total
disability shall constitute a cessation of employment within the meaning of
this paragraph. For the purposes of this paragraph:
(i) "Total disability" shall mean a disability which (1) results
from bodily injuries or disease, (2) wholly prevents Employee from
engaging in an occupation for remuneration or profit, and (3) results
from a cause not excluded from coverage under any insurance policy
that the Company may obtain on Employee's life pursuant to Section 5
of the ESP Plan. Subject to clause (3) above, the entire and
irrevocable loss of the sight of both eyes, or the use of both hands,
or both feet, or of one hand and one foot, shall be considered total
disability.
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(ii) "Occupation" shall mean (1) during the first twenty-four (24)
months of disability, Employee's regular occupation, and (2)
thereafter any occupation for which he is, or may be, reasonably
fitted by education, training or experience.
(b) Subject to the provisions of Section 6 (e) of the ESP Plan,
this Agreement shall terminate or be deemed amended if the ESP Plan is
terminated or amended, as the case may be.
(c) If prior to the execution of this Agreement, Employee made a
material misrepresentation, or omitted to state a material fact upon request,
relating to his age, physical condition or medical history, and the Company
relied on such representation or omission in entering into this Agreement, the
Company may terminate this Agreement:
(i) If Employee is alive at the time of termination, by giving
thirty (30) days' written notice of termination to Employee, such
notice to be given within sixty (60) days following discovery by the
Company of such material misrepresentation or omission or within two
years from the date hereof, whichever is earlier.
(ii) If Employee is dead at the time of termination and died from a
cause which would have been disclosed had the material
misrepresentation or omission not been made and such cause was not and
could not reasonably have been expected to have been disclosed by a
physical examination of the Employee made prior to the date hereof, by
giving thirty (30) days' written notice to the Beneficiary, such
notice to be given within sixty (60) days following discovery by the
Company of such material misrepresentation or omission or within five
years from the date hereof, whichever is earlier.
Notwithstanding the foregoing, the Company may terminate this Agreement if the
issuer of any insurance policy, which the Company may take on the life of
Employee pursuant to Section 5 of the ESP Plan, shall cancel such policy (or
the coverage extended to Employee's life) by reason of a misrepresentation made
by Employee prior to the date hereof relating to his age, physical condition or
medical history. Such termination shall be effected by giving thirty (30)
days' written notice to Employee within sixty (60) days following such
cancellation by the insurer.
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(x) Employee may terminate this Agreement at any time upon thirty
(30) days' written notice to the Company.
SECTION 3 - GENERAL
(a) All rights and incidents of ownership in any life insurance
policies that the Company may take out on Employee pursuant to Section 5 of the
ESP Plan shall belong to the Company; and neither Employee, nor any Beneficiary
or other person claiming under or through him, shall have any right, title or
interest in or to any such insurance policies or other assets of the Company.
(b) Subject to Section 6 (c) of the ESP Plan, Employee shall not
be obligated to contribute towards the costs of the benefits herein provided
for.
(c) This Agreement is issued pursuant to the ESP Plan which is
hereby incorporated by reference. Each term defined in the ESP Plan shall have
the same meaning herein as therein, unless the context otherwise requires.
This Agreement is subject to the terms and conditions of the ESP Plan and shall
be construed to conform to such Plan.
(d) Any notice required or permitted to be given under this
Agreement shall be in writing and shall be deemed properly given if sent by
registered or certified mail, addressed as follows:
(i) Notices to Employee:
Xxxx X. Xxxxxxxx
Omnicare, Inc.
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000
(ii) Notices to the Company:
Xx. X. X. Xxxxxxx, Secretary
Omnicare, Inc.
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000
Either party may, from time to time, change the address to which notices to it
shall be mailed by giving notice of such new address in the matter provided
herein.
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IN WITNESS WHEREOF, Employee and the Company have executed this
Agreement as of the date first above written.
OMNICARE, INC.
/s/ Xxxx X. Xxxxxxxx By /s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxxx Xxxx X. Xxxxxxx
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SCHEDULE A
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EXECUTIVE SALARY PROTECTION AGREEMENT
FOR XXXX X. XXXXXXXX
For the purpose of this Agreement
Employee's Recognized Compensation is
$500,000
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