AMENDMENT NO. 2
TO THE
EMPLOYMENT AGREEMENT
BY AND BETWEEN
NEIGHBORCARE, INC. (THE "COMPANY")
AND
XXXX X. XXXXXXX ("EXECUTIVE")
WHEREAS, Executive is currently employed by the Company;
WHEREAS, the terms of Executive's employment are currently governed by
that certain amended and restated employment agreement, amended and restated as
of December 9, 2003, and amended as of June 22, 2004 (the "Employment
Agreement"); and
WHEREAS, Executive would have Good Reason pursuant to the terms of the
Employment Agreement to terminate his employment with the Company upon a Change
of Control that results in the Company becoming a subsidiary of another entity
and no longer publicly traded; and
WHEREAS, in the event of a Change of Control, it is likely to be in the
interest of the Company for Executive to be obligated to continue his employment
with the Company for a period of at least ninety days following such Change of
Control, to assist with transition and for other reasons; and
WHEREAS, the Company and Executive wish to amend the terms of the
Employment Agreement effective as of a Change in Control of the Company (as
currently defined in Section 1.04 of the NeighborCare, Inc. Severance Pay Plan),
on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the mutual agreements hereinafter set
forth, the parties hereby agree as follows:
1. Section 4(d) of the Employment Agreement is hereby amended by adding
the following paragraph at the end thereof: "Notwithstanding the foregoing,
Executive agrees not to
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exercise Executive's right to resign for Good Reason pursuant to Section 4(d)(i)
hereof until the end of the ninety (90) day period commencing on the effective
date of a Change of Control, so long as Executive continues to be employed in
the same position and title at the Company with substantially similar
responsibilities and duties during such ninety-day period (taking into account
that the Company may be a subsidiary and no longer publicly traded following
such Change of Control)."
2. Section 8(b) of the Employment Agreement is hereby amended by adding
the following paragraph at the end thereof:
Notwithstanding the foregoing, the provisions of Sections 8(b)(i)
and 8(b)(iii) shall only prohibit Executive from competition
with, and solicitation or service of, customers of the Company's
LTC Pharmacy Services (as defined below) business as of
immediately prior to a Change of Control and shall have no other
effect; provided that the restriction on competition shall not
apply to any association by the Executive with entities for which
LTC Pharmacy Services comprises 25% or less of such entity's
total business; and further provided that the restriction on
solicitation or service of customers, directly or indirectly,
shall apply only to Facilities (as defined below) served by the
Company as of July 6, 2005 or served by the Company during the
12-month period immediately preceding the effective date of a
Change of Control. Notwithstanding the foregoing, during the
90-day period following the effective date of a Change of
Control, Executive shall be prohibited from soliciting or
serving, directly or indirectly, Facilities that have been
solicited by the Company during the 90-day period prior to the
effective date of such Change of Control.
"LTC Pharmacy Services" means: The provision of pharmaceutical products,
including, without limitation, prescription and non-prescription drugs;
biological products and infusion therapies; all related pharmacy services,
including, without limitation, consultant pharmacist services, medical
records, formulary management services and group purchasing and enteral
nutrition products to nursing homes, assisted living facilities,
independent living facilities, supportive living facilities, long-term
acute care hospitals, facilities for the developmentally disabled,
retirement communities, continuing care retirement communities, and other
institutional and long-term care settings (collectively, "Facilities") and
to
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residents of such Facilities; provided that the provision of biological
products, infusion therapies and enteral nutrition products (and related
services) to Facilities other than nursing facilities, assisted living
facilities, hospices and long-term acute care hospitals shall be permitted.
3. Except as provided in this Amendment No. 2, the terms and conditions
of the Employment Agreement shall remain unchanged.
4. This Amendment No. 2 shall be of no further force or effect if a
Change in Control of the Company does not occur on or prior to December 31,
2005.
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of the date first set forth above.
/s/ Xxxx X. Xxxxxxx NeighborCare, Inc.
----------------------
Xxxx X. Xxxxxxx
By: /s/ Xxxxxxxx X. Xxxxx
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July 12, 2005 Name: Xxxxxxxx X. Xxxxx
Title: Senior Vice President, Human
Resources
July 12, 2005
