EXHIBIT 10.11
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into as of the
4th day of March, 1997 by and between IVAX CORPORATION, a Florida corporation
(hereinafter called the "Company"), and XXXXXX X. XXXXXXX (hereinafter called
the "Executive").
RECITALS
A. The Board of Directors of the Company (the "Board") recognizes and
desires to assure the Company of the Executive's continued employment in an
executive capacity and to compensate him therefor.
B. The Board has determined that this Agreement will reinforce and
encourage the Executive's continued attention and dedication to the Company.
C. The Executive is willing to make his services available to the Company
on the terms and conditions hereinafter set forth.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and mutual covenants set
forth herein, the parties agree as follows:
1. EMPLOYMENT.
1.1 EMPLOYMENT AND TERM. The Company hereby agrees to employ the
Executive and the Executive hereby agrees to serve the Company, on the terms and
conditions set forth herein, for the period commencing on the date hereof and
expiring on March 31, 2000 (the "Initial Term") unless sooner terminated as
hereinafter set forth; provided, however, that commencing on April 1, 2000 and
each April 1 thereafter, the Initial Term of this Agreement shall automatically
be extended for one additional year unless at least ninety (90) days prior to
such April 1 date, the Company shall have delivered to the Executive or the
Executive shall have delivered to the Company written notice that the term of
the Executive's employment hereunder will not be extended.
1.2 DUTIES OF EXECUTIVE. The Executive shall serve as the President
and Chief Operating Officer of the Company and shall have powers and authority
superior to any other officer or employee of the Company or of any subsidiary of
the Company other than the Company's Chief Executive Officer (the "CEO").
Subject to the preceding sentence, during the term of Employment, the Executive
shall diligently perform all services as may be reasonably assigned to him by
the Board or CEO, and shall exercise such power and authority as may from time
to time be delegated to him by the Board or CEO. The Executive shall be required
to report solely to, and shall be subject solely to the supervision and
direction of either (x) the CEO, or (y) the Board at duly called meetings
thereof, and no other person or group shall be given authority to supervise or
direct Executive in the performance of his duties. The Executive shall devote
substantially all his working time and attention to the business and affairs of
the Company (excluding any vacation and sick leave to which the Executive is
entitled), render such services to the best of his ability, and use his
reasonable best efforts to promote the interests of the Company. It shall not be
a violation of this Agreement for the Executive to (A) serve on corporate, civic
or charitable boards or committees, (B) deliver lectures, fulfill speaking
engagements or teach at educational institutions, and (C) manage personal
investments, so long as such activities do not interfere with the performance of
the Executive's responsibilities as an employee of the Company in accordance
with this Agreement. For purposes of this Section 1.2, references to the "Board"
includes any authorized committee of the Board.
1.3 PLACE OF PERFORMANCE. In connection with his employment by the
Company, the Executive shall be based at the Company's principal executive
offices except for travel reasonably necessary in connection with the Company's
business.
2. COMPENSATION.
2.1 BASE SALARY. Commencing on the effective date of this Agreement,
the Executive shall receive a base salary at the annual rate of not less than
$475,000 (the "Base Salary") during the term of this Agreement, with such Base
Salary payable in installments consistent with the Company's normal payroll
schedule, subject to applicable withholding and other taxes. The Base Salary
shall be reviewed, at least annually, for merit increases and may, by action and
in the discretion of the Board (or any authorized committee thereof), be
increased at any time or from time to time. The Base Salary, if increased, shall
not thereafter be decreased for any reason.
2.2 INCENTIVE COMPENSATION. The Executive shall be entitled to receive
such bonus payments or incentive compensation as may be determined at any time
or from time to time by the Board (or any authorized committee hereof) in its
discretion. Such potential bonus payments and/or incentive compensation shall be
considered at least annually by the Board (or any authorized committee thereof).
2.3 STOCK OPTIONS.
(a) In connection with the Executive's agreement to serve as the
Company's President pursuant to the terms hereof, the Company agrees to grant to
the Executive a non-qualified stock option (the "Initial Option") to purchase
350,000 shares of the Company's common stock, par value $.10 per share ("Common
Stock"), at a per share exercise price equal to the closing price of the Common
Stock, as reported in the Wall Street Journal, on the effective date of this
agreement. A copy of the form of agreement evidencing the Initial Option is
attached hereto as EXHIBIT A.
(b) Not later than April 4, 1997, the Company shall grant to the
Executive a non-qualified option (the "Second Option") to purchase 350,000
shares of Common Stock at a per share exercise price equal to the fair market
value of the Common Stock on the date of grant. The Second Option shall vest 25%
per year until fully exercisable on the fourth anniversary of the date of grant,
have a term of ten years and otherwise be in the form of the Initial Option.
(c) The Initial Option and the Second Option (collectively the
"Options") shall be subject to the terms and conditions of the Company's 1994
Stock Option Plan (the "Plan"); provided, however, that notwithstanding anything
in the Plan or the forms of agreements evidencing the Options to the contrary:
(i) The vesting of the Options shall not automatically
accelerate upon consumption of the "BBI Merger" (as hereinafter defined);
(ii) The Options shall become immediately and fully
exercisable upon any termination of Executive's employment pursuant to Section
4.4 hereof (except for a termination by Executive (A) pursuant to clause (f) of
the definition of "Good Reason" therein), or (B) in the event the BBI Merger is
consummated, as a result of the position, authority, duties or responsibilities
initially assigned to him by the Board of Directors of BBI Healthcare
Corporation;
(iii) The Company shall take all action reasonably requested
by the Executive to permit the "cashless" exercise procedure contemplated by
Section 9(d) of the Plan or any reasonable alternative;
(iv) Upon proper exercise of an Option, the Executive shall
be deemed for all purposes the owner of the shares of Common Stock that are
purchasable upon such exercise;
(v) The Company agrees to keep in effect a Registration
Statement on Form S-8 or take any other action necessary to ensure that the
issuance of Common Stock pursuant to the Options is registered under the
Securities Act of 1933, as amended;
(vi) In case at any time or from time to time on or after the
date hereof holders of the Company's Common Stock become entitled to receive,
without payment therefor, other or additional stock or other securities or
property of the Company by way of a "spin-off," special dividend and/or
liquidation distribution (other than a regular cash dividend), then the Board
shall consider in good faith a fair and equitable adjustment of the exercise
price and/or other terms of the Options; and
(vii) The provisions of Section 13(b) of the Plan shall not
be adversely modified as to the Executive without the Executive's prior written
consent.
3. EXPENSE REIMBURSEMENT AND OTHER BENEFITS.
3.1 EXPENSE REIMBURSEMENT. During the term of Executive's employment
hereunder, the Company, in accordance with its expense policy in effect for
senior executives from time to time, shall reimburse the Executive for all
reasonable expenses actually paid or incurred by the Executive in the course of
and pursuant to the business of the Company, including expenses for travel and
entertainment.
3.2 INCENTIVE, SAVINGS AND RETIREMENT PLANS. During the Initial Term,
the Executive shall be entitled to participate in all incentive, savings and
retirement plans, practices, policies and programs generally applicable to other
key executives of the Company and its subsidiaries, in each case comparable to
those currently in effect or as subsequently amended. Such plans, practices,
policies and programs, in the aggregate, shall provide the Executive with
compensation, benefits and reward opportunities at least as favorable as the
most favorable of such compensation, benefits and reward opportunities provided
at any time hereafter with respect to other key executives based in the United
States, other than the CEO.
3.3 WELFARE BENEFIT PLANS. During the Initial Term, the Executive
and/or the Executive's family, as the case may be, shall be eligible for
participation in and shall receive all benefits under welfare benefit plans,
practices, policies and programs provided by the Company and its subsidiaries at
least as favorable as the most favorable of such plans, practices, policies and
programs in effect at any time hereafter with respect to other key executives
based in the United States, other than the CEO.
3.4 WORKING FACILITIES. During the term of Executive's employment
hereunder, the Company shall furnish the Executive with an office, a secretary
and such other facilities and services suitable to his position and adequate for
the performance of his duties hereunder.
3.5 VACATION. During the Initial Term, the Executive shall be entitled
to paid vacation in accordance with the most favorable plans, policies, programs
and practices of the Company and its subsidiaries as generally applicable to
other key executives of the Company and its subsidiaries based in
the United States, other than the CEO, but in no event shall the Executive be
entitled to fewer than four weeks paid vacation per year.
4. TERMINATION.
4.1 TERMINATION FOR CAUSE. Notwithstanding anything contained to the
contrary in this Agreement, this Agreement may be terminated by the Company for
Cause. As used in this Agreement, "Cause" shall only mean (i) an act or acts
of personal dishonesty taken by the Executive and intended to result in the
direct or indirect personal enrichment of the Executive at the expense of the
Company (it being agreed that disputes regarding expense reimbursements shall
not be subject to this clause (i) and shall instead be resolved in good faith by
the Board and the Executive), (ii) subject to the following sentences,
violation by the Executive of the Executive's material obligations under this
Agreement which are demonstrably willful and deliberate on the Executive's part
and which are not remedied in a reasonable period of time after receipt of
written notice from the Company, or (iii) the conviction of the Executive
for any criminal act which is a felony. Upon any determination by the Company's
Board of Directors that Cause exists under clause (ii) of the preceding
sentence, the Company shall cause a special meeting of the Board to be called
and held at a time mutually convenient to the Board and Executive, but in no
event later than ten (10) business days after Executive's receipt of the notice
contemplated by clause (ii). Executive shall have the right to appear before
such special meeting of the Board with legal counsel of his choosing to refute
any determination of Cause specified in such notice, and any termination of
Executive's employment by reason of such Cause determination shall not be
effective until Executive is afforded such opportunity to appear. Any
termination for Cause pursuant to clause (i) or (iii) of the first sentence of
this Section 4.1 shall be made in writing to Executive, which notice shall set
forth in detail all acts or omissions upon which the Company is relying for such
termination. Upon any termination pursuant to this Section 4.1, the Executive
shall be entitled to be paid his Base Salary to the date of termination and the
Company shall have no further liability hereunder (other than for reimbursement
for reasonable business expenses incurred prior to the date of termination).
4.2 DISABILITY. Notwithstanding anything contained in this Agreement
to the contrary, the Company, by written notice to the Executive, shall at all
times have the right to terminate this Agreement, and the Executive's employment
hereunder, if the Executive shall, as the result of mental or physical
incapacity, illness or disability, fail to perform his duties and
responsibilities provided for herein for a period of more than one hundred
twenty (120) consecutive days in any 12-month period. Upon any termination
pursuant to this Section 4.2, the Executive shall be entitled to be paid his
Base Salary to the date of termination and the Company shall have no further
liability hereunder (other than for reimbursement for reasonable business
expenses incurred prior to the date of termination).
4.3 DEATH. In the event of the death of the Executive during the term
of his employment hereunder, the Company shall pay to the estate of the deceased
Executive an amount equal to the sum of (x) any unpaid amounts of his Base
Salary to the date of his death, plus (y) six months of Base Salary, and the
Company shall have no further liability hereunder (other than for reimbursement
for reasonable business expenses incurred prior to the date of the Executive's
death).
4.4 TERMINATION WITHOUT CAUSE. At any time the Company shall have the
right to terminate Executive's employment hereunder by written notice to
Executive; provided, however, that the Company shall (i) pay to Executive any
unpaid Base Salary accrued through the effective date of termination specified
in such notice, and (ii) pay to the Executive in a lump sum, in cash within 30
days after the date of employment termination, an amount equal to the product of
(x) the Executive's then Base Salary, multiplied times (y) two. The Company
shall be deemed to have terminated the Executive's employment pursuant to this
Section 4.4 if such employment is terminated (i) by the Company without Cause,
or (ii) by the Executive voluntarily for "Good Reason." For purposes of this
Agreement, "Good Reason" means
(a) the assignment to the Executive of any duties inconsistent in
any respect with the Executive's position (including status, offices, titles and
reporting requirements), authority, duties or responsibilities as contemplated
by Section 1.2 of this Agreement, or any other action by the Company which
results in a diminution in such position, authority, duties or responsibilities,
in each case if not remedied within 30 days after receipt of written notice
thereof from the Executive;
(b) any failure by the Company to comply with any of the
provisions of Section 2, Section 3 or Section 7 of this Agreement which is not
remedied within 30 days after receipt of written notice thereof from the
Executive;
(c) the Company's requiring the Executive to be based at any
office or location other than Dade County, Florida, except for travel reasonably
required in the performance of the Executive's responsibilities;
(d) any purported termination by the Company of the Executive's
employment otherwise than as expressly permitted by this Agreement;
(e) any failure by the Company to comply with and satisfy Section
10(c) of this Agreement;
(f) any termination by the Executive for any reason during the
three-month period following the effective date of any "Change in Control"; or
(g) any failure of the Executive be elected a director of the
Company, or the removal of the Executive as a director, during the term hereof.
For purposes of this Section 4.4, any good faith determination of "Good Reason"
made by the Executive shall be conclusive.
5. CHANGE IN CONTROL. For purposes of this Agreement, a "Change in
Control" shall mean:
(a) The acquisition (other than by or from the Company), at any
time after the date hereof, by any person, entity or "group", within the meaning
of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934 (the
"Exchange Act"), of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of 50% or more of either the then
outstanding shares of common stock or the combined voting power of the Company's
then outstanding voting securities entitled to vote generally in the election of
directors; or
(b) All or any of the thirteen (13) individuals who, as of the
date hereof, constitute the Board (as of the date hereof the "Incumbent Board")
cease for any reason to constitute at least a majority of the Board, provided
that any person becoming a director subsequent to the date hereof whose
election, or nomination for election by the Company's shareholders, was approved
by a vote of at least a majority of the directors then comprising the Incumbent
Board (other than an election or nomination of an individual whose initial
assumption of office is in connection with an actual or threatened election
contest relating to the election of the directors of the Company, as such terms
are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act)
shall be, for purposes of this Agreement, considered as though such person were
a member of the Incumbent Board; or
(c) Approval by the shareholders of the Company of (A) a
reorganization, merger or consolidation with respect to which persons who were
the shareholders of the Company immediately prior to such reorganization, merger
or consolidation do not, immediately thereafter, own more than 50% of the
combined voting power entitled to vote generally in the election of directors of
the reorganized, merged or consolidated company's then outstanding voting
securities, (B) a liquidation or dissolution of
the Company, or (C) the sale of all or substantially all of the assets of the
Company, unless the approved reorganization, merger, consolidation, liquidation,
dissolution or sale is subsequently abandoned.
(d) The approval by the Board of the sale, distribution and/or
other transfer or action (and/or series of sales, distributions and/or other
transfers or actions from time to time or over a period of time), that results
in the Company's ownership of less than 75% of the Company's current assets.
Without limiting the generality of the foregoing, a "Change in Control" shall be
deemed to include consummation of the merger transactions (the "BBI Merger")
contemplated by that certain Agreement and Plan of Merger, dated as of November
10, 1996, as amended, among BBI Healthcare Corporation, the Company, Bergen
Xxxxxxxx Corporation, BBI-I Sub, Inc. and BBI-B Sub, Inc.
6. RESTRICTIVE COVENANTS.
6.1 NONDISCLOSURE. Contemporaneous herewith, the Executive is
executing the Company's standard form of Confidentiality Agreement, a copy of
which is attached hereto as EXHIBIT B.
6.2 NONSOLICITATION OF EMPLOYEES. While employed by the Company and
for a period of twenty-four (24) months thereafter, Executive shall not directly
or indirectly, for himself or for any other person, firm, corporation,
partnership, association or other entity, attempt to employ or enter into any
contractual arrangement with any employee or former employee of the Company,
unless such employee or former employee has not been employed by the Company for
a period in excess of twelve (12) months.
6.3 INJUNCTION. It is recognized and hereby acknowledged by the
parties hereto that a breach by the Executive of any of the covenants contained
in Section 6.1 or 6.2 of this Agreement will cause irreparable harm and damage
to the Company, the monetary amount of which may be virtually impossible to
ascertain. As a result, the Executive recognizes and hereby acknowledges that
the Company shall be entitled to an injunction from any court of competent
jurisdiction enjoining and restraining any violation of any or all of the
covenants contained in Section 5 of this Agreement by the Executive or any of
his affiliates, associates, partners or agents, either directly or indirectly,
and that such right to injunction shall be cumulative and in addition to
whatever other remedies the Company may possess.
7. CONFLICTS WITH CERTAIN EXISTING ARRANGEMENTS. The Company acknowledges
that it has received and reviewed Executive's non-competition covenants with his
prior employer, a copy of which is attached hereto as EXHIBIT C. The Company
agrees that it shall indemnify and hold harmless the Executive from any and all
damages that Executive may hereafter suffer or incur by reason of any Company
acquisition of a "Conflicting Organization" or other expansion of business after
the date hereof which results in a violation by the Executive of such
non-competition covenant. Executive represents that such covenant expires
on or before March 1, 1999.
8. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Florida.
9. NOTICES: Any notice required or permitted to be given under this
Agreement shall be in writing and shall be deemed to have been given when
delivered by hand or when deposited in the United States mail, by registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:
If to the Company: IVAX Corporation
0000 Xxxxxxxx Xxxxxxxxx
Xxxxx, Xxxxxxx 00000
Attention: General Counsel
If to the Executive: Xxxxxx X. Xxxxxxx
000 Xxx Xxxxx Xxxxxx
Xxxxx Xxxxxx, Xxxxxxx 00000
WITH A COPY TO:
---------------
Greenberg, Traurig, Hoffman,
Lipoff, Xxxxx & Xxxxxxx, P.A.
0000 Xxxxxxxx Xxxxxx
Xxxxx, Xxxxxxx 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
or to such other addresses as either party hereto may from time to time give
notice of to the other in the aforesaid manner.
10. SUCCESSORS.
(a) This Agreement is personal to the Executive and without the
prior written consent of the Company shall not be assignable by the Executive
otherwise than by will or the laws of descent and distribution. This Agreement
shall inure to the benefit of and be enforceable by the Executive's legal
representatives.
(b) This Agreement shall inure to the benefit of and be binding
upon the Company and its successors and assigns.
(c) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. As used in this Agreement, "Company" shall mean the Company as
hereinbefore defined and any successor to its business and/or assets which
assumes and agrees to perform this Agreement by operation of law or otherwise.
11. SEVERABILITY. The invalidity of any one or more of the words,
phrases, sentences, clauses or sections contained in this Agreement shall not
affect the enforceability of the remaining portions of this Agreement or any
part thereof, all of which are inserted conditionally on their being valid in
law, and, in the event that any one or more of the words, phrases, sentences,
clauses or sections contained in this Agreement shall be declared invalid, this
Agreement shall be construed as if such invalid word or words, phrase or
phrases, sentence or sentences, clause or clauses, or section or sections had
not been inserted. If such invalidity is caused by length of time or size of
area, or both, the otherwise invalid provision will be considered to be reduced
to a period or area which would cure such invalidity.
12. WAIVERS. The waiver by either party hereto of a breach or violation of
any term or provision of this Agreement shall not operate nor be construed as a
waiver of any subsequent breach or violation.
13. DAMAGES. Nothing contained herein shall be construed to prevent the
Company or the Executive from seeking and recovering from the other damages
sustained by either or both of them as a result of its or his breach of any term
or provision of this Agreement, except that the payment required to be made by
the Company to the Executive pursuant to Section 4.4 shall be the Executive's
exclusive remedy for any termination of this Agreement pursuant to such
section.
14. NO THIRD PARTY BENEFICIARY. Nothing expressed or implied in this
Agreement is intended, or shall be construed, to confer upon or give any person
(other than the parties hereto and, in the case of Executive, his heirs,
personal representative(s) and/or legal representative) any rights or remedies
under or by reason of this Agreement.
15. FULL SETTLEMENT. The Company's obligation to make the payments
provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action which the Company may have against the
Executive or others. In no event shall the Executive be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable
to the Executive under any of the provisions of this Agreement. The Company
agrees to pay, to the full extent permitted by law, all legal fees and expenses
which the Executive may reasonably incur as a result of any contest (regardless
of the outcome thereof) by the Company or others of the validity or
enforceability of any provision of this Agreement (including as a result of any
contest by the Executive about the amount of any payment pursuant to Section 16
of this Agreement), plus in each case interest at the applicable Federal rate
provided for in Section 7872(f)(2) of the Code.
16. CERTAIN REDUCTION OF PAYMENTS BY THE COMPANY.
(a) Anything in this Agreement to the contrary notwithstanding, in
the event it shall be determined that any payment or distribution by the Company
to or for the benefit of the Executive, whether paid or payable or distributed
or distributable pursuant to the terms of this Agreement or otherwise (a
"Payment"), would be nondeductible by the Company for Federal income tax
purposes because of Section 280G of the Code, then the aggregate present value
of amounts payable or distributable to or for the benefit of the Executive
pursuant to this Agreement (such payments or distributions pursuant to this
Agreement are hereinafter referred to as "Agreement Payments") shall be reduced
to the Reduced Amount. The "Reduced Amount" shall be an amount expressed in
present value which maximizes the aggregate present value of Agreement Payments
without causing any Payment to be nondeductible by the Company because of
Section 280G of the Code. Anything to the contrary notwithstanding, if the
Reduced Amount is zero and it is determined further that any Payment which is
not an Agreement Payment would nevertheless be nondeductible by the Company for
Federal income tax purposes because of Section 280G of the Code, then the
aggregate present value of Payments which are not Agreement Payments shall also
be reduced (but not below zero) to an amount expressed in present value which
maximizes the aggregate present value of Payments without causing any Payment to
be nondeductible by the Company because of Section 280G of the Code. For
purposes of this Section 16, present value shall be determined in accordance
with Section 280G(d)(4) of the Code. Any amount which is not paid in the taxable
year in which it was originally scheduled to be paid as a result of the
postponement thereof pursuant hereto shall be payable in the next succeeding
taxable year in which such payment will not result in the disallowance of a
deduction pursuant to either Section 162(m) or 280G of the Code; provided,
however, that all postponed payments shall be placed in a Rabbi trust or similar
vehicle for the benefit of the Executive in such a way that the amounts so
transferred are not taxable to such person or deductible by the Company until
payment from such vehicle to the Executive is made. In the event a payment has
been made to the Executive, but then disallowed as a
deduction by the Internal Revenue Service and return of the payment is required
into the trust, said payment to the Executive shall be treated as a loan and
said payment to the trust shall be treated as repayment of said loan. The
Company shall not pledge, hypothecate or otherwise encumber any amounts held in
the trust or other similar vehicle for the benefit of the Executive hereunder.
(b) All determinations required to be made under this Section 16
shall be made by the Company's independent public accountants (the "Accounting
Firm"), which shall provide (i) detailed supporting calculations both to the
Company and the Executive within twenty (20) business days of the termination of
Executive's employment or such earlier time as is requested by the Company, and
(ii) an opinion to the Executive that he has substantial authority not to
report any excise tax on his Federal income tax return with respect to any
Payments. Any such determination by the Accounting Firm shall be binding upon
the Company and the Executive. The Executive shall determine which and how much
of the Payments shall be eliminated or reduced consistent with the requirements
of this Section 16, provided that, if the Executive does not make such
determination within ten business days of the receipt of the calculations made
by the Accounting Firm, the Company shall elect which and how much of the
Payments shall be eliminated or reduced consistent with the requirements of this
Section 16 and shall notify the Executive promptly of such election. Within five
business days thereafter, the Company shall pay to or distribute to or for the
benefit of the Executive such amounts as are then due to the Executive under
this Agreement. All fees and expenses of the Accounting Firm incurred in
connection with the determinations contemplated by this Section 16 shall be
borne by the Company.
(c) As a result of the uncertainty in the application of Section
280G of the Code at the time of the initial determination by the Accounting Firm
hereunder, it is possible that Payments will have been made by the Company which
should not have been made ("Overpayment") or that additional Payments which will
not have been made by the Company could have been made ("Underpayment"), in each
case, consistent with the calculations required to be made hereunder. In the
event that the Accounting Firm, based upon the assertion of a deficiency by the
Internal Revenue Service against the Executive which the Accounting Firm
believes has a high probability of success, determines that an Overpayment has
been made, any such Overpayment paid or distributed by the Company to or for the
benefit of the Executive shall be treated for all purposes as a loan ab initio
to the Executive which the Executive shall repay to the Company together with
interest at the applicable federal rate provided for in Section 7872(f)(2) of
the Code; provided, however, that no such loan shall be deemed to have been made
and no amount shall be payable by the Employee to the Company if and to the
extent such deemed loan and payment would not either reduce the amount on which
the Executive is subject to tax under Section 1 and Section 4999 of the Code or
generate a refund of such taxes. In the event that the Accounting Firm, based
upon controlling precedent or other substantial authority, determines that an
Underpayment has occurred, any such Underpayment shall be promptly paid by the
Company to or for the benefit of the Executive together with interest at the
applicable federal rate provided for in Section 7872(f)(2) of the Code.
17. ELECTION OF EXECUTIVE AS DIRECTOR. Management of the Company agrees to
nominate the Executive for election to the Board at the next meeting of the
Board. For so long as the Executive continues to serve as the Company's
President, the Company shall cause the nomination of the Executive as a director
of the Company at each shareholder meeting at which election of directors is
considered.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first above written.
COMPANY:
IVAX CORPORATION
By: /s/ Xxxxxxx Xxxxx, M.D.
---------------------------------
Xxxxxxx Xxxxx, M.D.,
Chairman and Chief Executive Officer
EXECUTIVE:
/s/ Xxxxxx X. Xxxxxxx
--------------------------------------
XXXXXX X. XXXXXXX
