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EXHIBIT 10.34
FIRST AMENDMENT TO CHANGE IN CONTROL SEVERANCE AGREEMENT
This First Amendment to Change in Control Severance Agreement (the
"Amendment") is executed by Xxxxx X. Xxxxxxx (the "Executive") and Xxxxxxx
Enterprises, Inc., a Delaware corporation (the "Company" or "Xxxxxxx"), to
amend the Change in Control Agreement dated as of December 8, 1995, between
the Executive and the Company (the "Agreement"). The Executive and the
Company hereby agree as follows:
1. Definitions. Unless expressly defined in this Amendment, the
capitalized terms used in this Amendment have the definitions attributed to
them in the Agreement, and the definitions of those terms in the Agreement are
incorporated herein by reference.
2. Employer. Executive is employed by Pharmacy Corporation of
America ("PCA"), a subsidiary of the Company. Accordingly, all references to
"the Company" in Paragraphs 1(b), 1(e), 1(g), 1(h), and 4(d) of the Agreement
shall mean PCA and not Xxxxxxx. The parties agree that all references to the
Company in paragraphs 2, 3(a), 3(b), 6, 7, 8, 11, 12, 13 and 19 shall include
PCA and Xxxxxxx. The parties further agree that all references to "the Company"
in paragraphs 1(c), 4(b), 4(c) (i) and (ii), 4(e), (f), (g), 5, 14, and 20 shall
mean only Xxxxxxx.
3. Termination of Employment.
Section 1(h) of the Agreement is amended to add the following:
Termination of employment shall mean the termination of the
Executive's employment by Xxxxxxx, or by PCA if PCA terminates the
Executive as a result of the Change in Control of Xxxxxxx, other than
such a termination in connection with an offer of immediate
reemployment by a successor or assign of Xxxxxxx or purchaser of
Xxxxxxx or its assets under terms and conditions which would not
permit the Executive to terminate his employment for Good Reason.
4. Eligibility for Severance Benefits.
Section 3 of the Agreement is amended to add the following:
The Executive shall be eligible for the Severance Benefits
described in Paragraph 4 of the Agreement, except that Executive shall
be entitled to those benefits for a one (1) year period only, if (a)
the Company does not, by December 31, 1996 (i) sell some or all of the
capital stock of Pharmacy Corporation of America ("PCA") to the
general public in an initial public offering or series of public
offerings or (ii) distribute to the Company's shareholders some or all
of the outstanding capital stock of PCA, and if Executive as a result
of either of the above, terminates his employment with PCA within
thirty-one (31) days of that date and in no event later than February
1, 1997; or (b) the Executive has a Termination of Employment
initiated (i) by the Company or PCA without Cause, or (ii) by the
Executive for Good Reason.
5. Relocation Benefit.
Section 4(d) of the Agreement is amended by replacing Fort Xxxxx,
Arkansas with Tampa, Florida.
6. Excise Tax Indemnification.
Section 5 of the Agreement is amended to add the following paragraph:
If, in the written opinion of a Big 6 accounting firm engaged
by either the Company or the Exeuctive for this purpose (at the
Company's expense), or if so alleged by the Internal Revenue Service,
unless the Company by written notice to the Executive elects to contest
the allegation by the Internal Revenue Serviece (at the Company's
expense), in which case no payment hereunder shall be paid and the
Company shall prosecute its position to any conclusion it chooses, the
aggregate of the benefit payments received by the Executive pursuant to
the Employment Agreement executed on August 1, 1993 by the Executive
and Pharmacy Management Services, Inc. ("PMSI") and any and all
Addenda, including the Severance Agreement executed by the Executive
and PMSI as amended on February 15, 1995, (the "Payments"), would
constitute an "excess parachute payment" as defined in Section 280G(b)
of the Internal Revenue Code (the "Code"), then the Company will pay to
the Executive an additional amount in cash (the "Gross-Up Payment")
equal to the amount necessary to cause the net amount of Payments
retained by the Executive, after deduction of any (i) excise tax on the
payments provided for in this paragraph; (ii) federal, state or local
income tax on Gross-Up Payment, and (iii) excise tax on the Gross-Up
Payment, to be equal to the aggregate remuneration the Executive would
have received pursuant to the Payments, excluding such Gross-Up Payment
(net of all federal, state and local excise and income taxes), as if
Section 280G(b) and 4999 of the Code (and any successor provisions
thereto) had not been enacted into law. The Gross-Up Payment provided
for in this Paragraph shall be made within thirty (30) days after such
final determination by the Internal Revenue Service. Any payments
under this Paragraph shall be in lieu of any gross-up payments
otherwise due Executive under any agreement with PMSI, PCA, or the
Company relating to said Payments.
7. Disputes.
Section 8 of the Agreement is amended by replacing Fort Xxxxx,
Arkansas with Tampa, Florida.
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8. Entire Agreement.
Section 18 of the Agreement is amended by replacing it with the
following Paragraph:
This Agreement, together with the Indemnification Agreement
attached hereto as Exhibit A (the "Xxxxxxx Indemnification Agreement")
sets forth the entire agreement of the parties hereto in respect of
the subject matter contained herein and therein, and supersedes all
prior agreements, promises, covenants, arrangements, communications,
representations or warranties, whether oral or written, by any
officer, employee or representative of any party hereto, including the
Employment Agreement executed on August 1, 1993 by the Executive and
Pharmacy Management Services, Inc. ("PMSI") and any and all Addenda
including the Severance Agreement executed by the Executive and PMSI
as amended on February 16, 1995, and the Indemnity Agreement executed
by the Executive and PMSI and dated as of 1993, except for Section
3.12 of the Agreement and Plan of Merger dated December 26, 1994, as
amended May 19, 1995, between PMSI and Xxxxxxx. The parties further
intend that this Agreement and the Xxxxxxx Indemnification Agreement
shall constitute the complete and exclusive statement of their
respective terms and that no extrinsic evidence whatsoever may be
introduced in any judicial, administrative, or other legal proceeding
involving this Agreement or the Xxxxxxx Indemnification Agreement.
9. Continued Effectiveness. Except as amended by this Amendment,
the Agreement continues in full force and effect. The Amendment will become
effective when executed by the Executive and the Company.
XXXXXXX ENTERPRISES, INC. EXECUTIVE
By:
Xxxx X. Xxxxxxxxxxx Xxxxx X. Xxxxxxx
President and Chief Operating Officer 0000 Xxxxxxxx Xxxx
0000 Xxxxxx Xxxxxx, Xxxxx 00-X Xxxxx, XX 00000
Xxxx Xxxxx, XX 00000
By:
Xxxxxx X. Xxxxxxxxxxx
Executive Vice President,
General Counsel and Secretary
0000 Xxxxxx Xxxxxx, Xxxxx 00-X
Xxxx Xxxxx, XX 00000
Attention: Secretary
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