3
December 31, 1995
Mr. Xxxxx Xxxxx
0 Xxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Dear Xxxxx:
Since the 1994 Combination Transaction resulted in a new
operational structure to ALPHARMA INC. (the "Company"), as well
as in your appointment as President of the Animal Health Division
("AHD") and Vice-President of the Company, I wanted to send you
this letter clarifying the material terms of your present
position with the Company. This position, as you know, is
headquartered in Fort Xxx, New Jersey and reports directly to me.
The material terms of this position are as follows:
1. Your base salary for 1996 is $290,000. Your base salary
will be reviewed for adjustment as of January 1 of each
year.
2. You will be considered for an annual cash bonus each
year. In your position, you are eligible for a bonus (the
amount of which shall be based on a percentage of your base
salary as established in the Company's bonus policy, as such
policy may be amended from time to time) based on the
overall performance of the Company, the performance of AHD,
and your individual performance and contribution.
3. You will continue to be eligible to receive stock options
under the terms of the Company's Stock Option Plan. Under
the present provisions of the Plan, (a) options granted
become exercisable at 25% of the total granted, one, two,
three and four years from grant; (b) the purchase price is
the market price at the date of grant; (c) options expire
ten years after grant and are normally granted in the spring
of each year, based on the performance of your respective
division, the overall performance of the Company and your
individual performance and contribution.
4. You will receive a taxable cash automobile allowance of
$15,418 per year. In addition, the Company will reimburse
you for insurance for your automobile and for maintenance of
up to $2000 per year.
5. You will be entitled to vacation pursuant to the
Company's vacation policy.
6. You will receive a taxable annual $3000 allowance for tax
and/or financial planning and tax return preparation.
7. You understand that your employment is at will. If your
services are terminated because of a change in top
management, the Company or your division being acquired or
reorganized, or for any other reasons other than cause, you
will be paid twelve month's base salary with fringe benefits
in a manner best suited for the Company. In the event that
you do not have another senior executive position after the
twelve month period immediately following the date of your
termination, the Company will pay you your base salary with
fringe benefits until you take another senior executive
position for up to an additional six months thereafter.
8. Additionally, you will continue to participate in all
programs established for employees of the Company,
including:
(a) Life insurance for three times your annual salary
with the premium paid by the Company.
(b) A disability program that pays sixty percent of
your annual salary integrated with social security
until age seventy. The premium is paid by the Company.
(c) The ALPHARMA INC. Pension Plan (currently
covering the first $150,000 of base salary) as
well as the ALPHARMA INC. Supplemental Pension
Plan (currently covering base salary amounts above
$150,000 up to a cap of $235,000) fully paid by
the Company.
(d) A Stock Purchase Plan in which employees can elect
up to four percent of salary for the purchase ALPHARMA
stock. The Company will match 25% of the
employee's contribution.
(e) A group health and medical plan for which the
employee pays $11.54 for single coverage, $27.69 for
family coverage, for each two-week period. The
remainder of the premium is paid by the Company.
(f) A Savings Plan to which the employee can save
either on a pre and/or post tax basis and contribute up
to 15% of base pay. The Company provides a service-
weighted match on the first 6% of employee
contributions.
I would appreciate your acknowledgment of the terms herein by
signing both copies of this letter where indicated and return one
original signed document to Xxxx X. Xxxxx, Corporate Counsel.
Sincerely,
Xxxxx X. Xxxxxxxx
Chief Executive Officer and
Chairman of the Board of Directors
Agreed and Accepted:
__________________________
Xxxxx X. Xxxxx
Date:____________
