10-Q

FORM 10-Q

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2002

Commission File Number 1-09623

IVAX CORPORATION

Florida	16-1003559
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

4400 Biscayne Boulevard, Miami, Florida 33137

(Address of principal executive offices) (Zip Code)

(305) 575-6000

(Registrant’s telephone number, including area code)

     Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes [X]       No [   ]

     Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

194,554,951 shares of Common Stock, $.10 par value, outstanding as of July 26, 2002.

IVAX CORPORATION

INDEX

	PAGE NO.
PART I — FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets as of June 30, 2002 and December 31, 2001		2
Consolidated Statements of Operations for the three and six months ended June 30, 2002 and 2001		3
Consolidated Statements of Shareholders’ Equity for the six months ended June 30, 2002		5
Consolidated Statements of Cash Flows for the six months ended June 30, 2002 and 2001		6
Notes to Consolidated Financial Statements		8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		16
Item 3. Quantitative and Qualitative Disclosures About Market Risk		25
PART II — OTHER INFORMATION
Item 1. Legal Proceedings		28
Item 4. Submission of Matters to a Vote of Security Holders		28
Item 6. Exhibits and Reports on Form 8-K		28

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements

IVAX CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)

					June 30,			December 31,
					2002			2001
					(Unaudited)
				ASSETS
Current assets:
	Cash and cash equivalents				$	149,419		$	178,264
	Marketable securities					26,081			154,842
	Accounts receivable, net of allowances for doubtful accounts of $22,002 in 2002 and $21,670 in 2001					202,058			247,670
	Inventories					291,037			253,471
	Other current assets					145,268			164,692
		Total current assets				813,863			998,939
Property, plant and equipment, net						377,637			356,304
Goodwill, net						414,239			502,077
Intangible assets, net						283,376			187,479
Other assets						51,650			60,650
		Total assets			$	1,940,765		$	2,105,449
			LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
	Accounts payable				$	86,047		$	97,465
	Current portion of long-term debt					26,325			52,199
	Loans payable					19,160			13,249
	Accrued income taxes payable					13,295			41,861
	Accrued expenses and other current liabilities					191,791			196,587
		Total current liabilities				336,618			401,361
Long-term debt, net of current portion						910,016			913,486
Other long-term liabilities						58,593			57,536
Minority interest						15,504			14,712
Shareholders’ equity:
	Common stock, $.10 par value, authorized 437,500 shares, issued and outstanding 194,987 shares in 2002 and 196,523 shares in 2001					19,498			19,652
	Capital in excess of par value					318,831			328,095
	Put options					—			34,650
	Retained earnings					501,652			446,469
	Accumulated other comprehensive loss					(219,947	)		(110,512	)
		Total shareholders’ equity				620,034			718,354
		Total liabilities and shareholders’ equity			$	1,940,765		$	2,105,449

The accompanying Notes to Consolidated Financial Statements are an integral part of these balance sheets.

2

IVAX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

		Three Months						Six Months
		2002			2001			2002			2001
Period Ended June 30,
(In thousands, except per share data)
Net revenues		$	280,406		$	301,782		$	552,628		$	561,714
Cost of sales			149,843			143,339			300,090			267,063
	Gross profit		130,563			158,443			252,538			294,651
Operating expenses:
	Selling		43,701			30,103			85,847			57,605
	General and administrative		27,368			28,906			54,634			52,627
	Research and development		18,330			20,020			37,384			38,903
	Amortization of intangible assets		3,918			4,229			6,932			7,823
	Restructuring costs		1,794			(220	)		2,282			(221	)
	Total operating expenses		95,111			83,038			187,079			156,737
	Income from operations		35,452			75,405			65,459			137,914
Other income (expense):
	Interest income		3,026			9,933			5,425			13,741
	Interest expense		(12,312	)		(10,460	)		(24,720	)		(14,819	)
	Other income, net		19,354			9,182			24,374			10,932
	Gain on partial sale of IVAX Diagnostics, Inc.		—			—			—			10,278
	Total other income, net		10,068			8,655			5,079			20,132
	Income from continuing operations before income taxes and minority interest		45,520			84,060			70,538			158,046
Provision for income taxes			13,766			16,211			19,578			29,966
	Income from continuing operations before minority interest		31,754			67,849			50,960			128,080
Minority interest			(32	)		14			62			(85	)
	Income from continuing operations		31,722			67,863			51,022			127,995
Cumulative effect of a change in accounting principle			—			—			4,161			—
Net income		$	31,722		$	67,863		$	55,183		$	127,995

(Continued)

3

IVAX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Continuation)

		Three Months				Six Months
		2002		2001		2002		2001
Period Ended June 30,
(In thousands, except per share data)
BASIC EARNINGS PER COMMON SHARE:
	Continuing operations	$	0.16	$	0.34	$	0.26	$	0.64
	Cumulative effect of a change in accounting principle		—		—		0.02		—
	Net income	$	0.16	$	0.34	$	0.28	$	0.64
DILUTED EARNINGS PER COMMON SHARE:
	Continuing operations	$	0.16	$	0.33	$	0.26	$	0.62
	Cumulative effect of a change in accounting principle		—		—		0.02		—
	Net income	$	0.16	$	0.33	$	0.28	$	0.62
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING:
	Basic		195,083		199,876		195,642		199,567
	Diluted		196,998		207,605		198,128		206,979

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

4

IVAX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(Unaudited)
(In thousands)

				Common Stock														Accumulated
										Capital in								Other
				Number of						Excess of			Put			Retained		Comprehensive
				Shares			Amount			Par Value			Options			Earnings		Income (Loss)			Total
BALANCE, December 31, 2001					196,523		$	19,652		$	328,095		$	34,650		$	446,469	$	(110,512	)	$	718,354
	Comprehensive loss:
		Net income			—			—			—			—			55,183		—			55,183
		Translation adjustment			—			—			—			—			—		(105,832	)		(105,832	)
		Unrealized net loss on available-for-sale equity securities and derivatives, net of tax			—			—			—			—			—		(3,603	)		(3,603	)
			Comprehensive loss		—			—			—			—			—		—			(54,252	)
	Exercise of stock options				577			58			4,700			—			—		—			4,758
	Tax benefit of option exercises				—			—			1,297			—			—		—			1,297
	Employee stock purchases				33			3			499			—			—		—			502
	Repurchase and retirement of common stock				(3,117	)		(312	)		(37,588	)		(12,725	)		—		—			(50,625	)
	Shares issued to settle put options				971			97			21,828			(21,925	)		—		—			—
BALANCE, June 30, 2002					194,987		$	19,498		$	318,831		$	—		$	501,652	$	(219,947	)	$	620,034

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

5

IVAX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

				2002			2001
Six Months Ended June 30,
(In thousands)
Cash flows from operating activities:
	Net income			$	55,183		$	127,995
	Adjustments to reconcile net income to net cash flows from operating activities:
		Restructuring costs			2,282			(221	)
		Depreciation and amortization			26,668			22,688
		Deferred tax provision (benefit)			1,362			(17,683	)
		Tax effect of stock option exercises			1,297			7,751
		Provision for doubtful accounts			2,064			1,033
		Provision for inventory obsolescence			5,173			10,472
		Interest accretion on QVAR note			453			—
		Minority interest in earnings			(62	)		85
		Equity in earnings of unconsolidated affiliates			(502	)		(619	)
		Gain on sale of marketable securities			(797	)		—
		Gain on sale of product rights			(7,489	)		(7,347	)
		Losses (gains) on sale of assets, net			370			(12,732	)
		Gains on extinguishment of debt			(9,570	)		—
		Cumulative effect of a change in accounting principle			(4,161	)		—
		Changes in operating assets and liabilities:
			Accounts receivable		37,813			(29,665	)
			Inventories		(40,591	)		(12,906	)
			Other current assets		9,396			(6,474	)
			Other assets		3,538			3,482
			Accounts payable, accrued expenses, and other current liabilities		(40,569	)		7,313
			Other long-term liabilities		1,701			(153	)
			Net cash flows from operating activities		43,559			93,019
Cash flows from investing activities:
	Proceeds from sale of product rights				7,489			3,097
	Capital expenditures				(35,150	)		(24,071	)
	Proceeds from sale of assets				—			44,912
	Acquisitions of intangible assets				(32,946	)		(10,907	)
	Acquisitions of businesses, net of cash acquired				6,417			(79,809	)
	Investment in affiliates				58			(17,913	)
	Purchases of marketable securities				(100,473	)		(238,092	)
	Proceeds from sales of marketable securities				226,420			—
		Net cash flows from investing activities			71,815			(322,783	)
Cash flows from financing activities:
	Borrowings on long-term debt and loans payable				9,436			723,785
	Payments on long-term debt and loans payable				(94,419	)		(17,413	)
	Exercise of stock options and employee stock purchases				5,260			11,320
	Repurchase of common stock				(50,625	)		(58,577	)
		Net cash flows from financing activities			(130,348	)		659,115
Effect of exchange rate changes on cash and cash equivalents					(13,871	)		2,126
Net (decrease) increase in cash and cash equivalents					(28,845	)		431,477
Cash and cash equivalents at the beginning of the year					178,264			174,794
Cash and cash equivalents at the end of the period				$	149,419		$	606,271

(Continued)

6

IVAX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Continuation)

			2002		2001
Six Months Ended June 30,
(In thousands)
Supplemental disclosures:
	Interest paid		$	22,895	$	9,135
	Income tax payments		$	38,899	$	34,100
Supplemental schedule of non-cash investing and financing activities:
		Information with respect to acquisitions which were accounted for under the purchase method of accounting is summarized as follows:
Fair value of assets acquired					$	83,886
Liabilities assumed						(56,088	)
Net assets acquired						27,798
Purchase price:
	Cash, net of cash acquired					79,754
	Acquisition costs					55
	Fair market value of stock and options issued					77,056
	Total					156,865
Goodwill					$	129,067

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

7

IVAX CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(In thousands, except per share data)

(1) GENERAL:

     The accompanying unaudited interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information and footnotes required by generally accepted accounting principles for complete financial statements. However, in the opinion of management, all adjustments (consisting of only normal recurring adjustments) considered necessary to present fairly the results of operations, financial position and cash flows have been made. The results of operations and cash flows for the six months ended June 30, 2002, are not necessarily indicative of the results of operations and cash flows which may be reported for the remainder of 2002. The interim consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes to consolidated financial statements included in IVAX’ Annual Report on Form 10-K for the year ended December 31, 2001. For purposes of these financial statements, North America includes the United States and Canada. Mexico is included within Latin America. Certain prior period amounts presented in the consolidated financial statements have been reclassified to conform to the current period’s presentation.

(2) INVENTORIES:

     Inventories consist of the following:

		June 30,		December 31,
		2002		2001
Raw materials		$	114,876	$	110,443
Work-in-process			52,423		34,820
Finished goods			123,738		108,208
	Total inventories	$	291,037	$	253,471

(3) EARNINGS PER SHARE:

     A reconciliation of the denominator of the basic and diluted earnings per share computation is as follows:

		Three Months				Six Months
		2002		2001		2002		2001
Period Ended June 30,
Basic weighted average number of shares outstanding			195,083		199,876		195,642		199,567
Effect of dilutive securities — stock options and warrants			1,915		7,729		2,486		7,412
Diluted weighted average number of shares outstanding			196,998		207,605		198,128		206,979
Not included in the calculation of diluted earnings per share because their impact is antidilutive:
	Stock options outstanding		14,264		250		9,960		346
	Convertible debt		23,518		26,514		24,299		26,514
	Put options		—		281		—		281

8

(4) REVENUES:

     Net revenues are comprised of gross revenues less provisions for expected customer returns, inventory credits, discounts, promotional allowances, volume rebates, chargebacks and other allowances. The reserve balances related to these provisions are included in “Accounts receivable, net of allowances for doubtful accounts” and “Accrued expenses and other current liabilities” in the accompanying consolidated balance sheets in the amounts of $133,723 and $97,093, respectively, at June 30, 2002, and $115,752 and $88,955, respectively, at December 31, 2001.

(5) INTANGIBLE ASSETS:

     Intangible assets with definite lives are amortized and carried at cost less accumulated amortization. Intangible assets with indefinite lives are carried at cost and are not amortized. Intangible assets consist of the following:

		June 30, 2002				December 31, 2001
		Gross				Gross
		Carrying		Accumulated		Carrying		Accumulated
		Amount		Amortization		Amount		Amortization
Amortized intangible assets:
	Patents and related licenses	$	81,824	$	43,709	$	73,031	$	40,766
	Trademarks		115,212		6,074		112,958		2,114
	Licenses and other intangibles		117,557		6,026		22,768		4,352
	Total	$	314,593	$	55,809	$	208,757	$	47,232
Unamortized intangible assets:
	Trademarks & product registrations	$	24,592			$	25,954

     On March 1, 2002, IVAX acquired from Syntex Pharmaceuticals International Ltd. the non-U.S. rights to pharmaceutical products containing flunisolide hemihydrate, sold under the tradenames Syntaris, Nasalide, Rhinalar, Locasyn and Lokilan, for 10,156 Swiss francs ($5,986 at the February 28, 2002, currency exchange rate).

     On April 2, 2002, IVAX entered into an agreement to acquire the technical files and French marketing authorizations to substantially all of the products comprising the generic pharmaceutical business of Merck & Co., Inc.’s subsidiary in France. The total consideration due is 5,641 Euros ($4,917 at the March 31, 2002, currency exchange rate) one-half of which was paid upon signing and the remainder due in four months. On July 19, 2002, the agreement was amended reducing the second payment to 2,565 Euros ($2,531 as of the August 2, 2002, payment date).

     On April 22, 2002, IVAX acquired an exclusive U.S. license to the patent rights to market QVAR™ (beclomethasone dipropionate HFA), an aerosol inhaler prescribed to treat asthma. In addition, IVAX has an option to obtain ownership of the U.S. QVAR trademark, as well as related patents and the New Drug Application in five years. 3M Drug Delivery Systems will manufacture the QVAR product for IVAX under a long-term contract. The purchase price was allocated to the fair values of the assets acquired pursuant to an independent appraisal resulting in a value of $27,140 for the license agreement, which is being amortized over its 5 year life, and $67,116 for the option, which is not being amortized. If the option is exercised, the value of the option will be allocated to the underlying assets acquired by the exercise and appropriate lives determined. The total consideration due under the contract, including options and extensions, is $105,000, $21,000 of which was paid on the effective date, $22,000 is due on

9

the first anniversary, $31,000 is due on the second anniversary, $26,000 is due on the third anniversary and $5,000 is due on the fifth anniversary upon exercise of the option. IVAX also acquired a non-exclusive worldwide license to certain 3M patents covering HFA formulations of various asthma drugs.

(6) DEBT:

     During January 2002, IVAX repaid $48,000 of U.S. denominated loans held by an Argentine subsidiary resulting in a pretax foreign exchange loss of $2,824.

     See Note 10, Recently Issued Accounting Standards, for a discussion of the classification of gains on extinguishment of debt. During the first quarter of 2002, IVAX repurchased $35,000 of 4.5% Convertible Senior Subordinated Notes due 2008 for $28,797, plus accrued interest of $484, and wrote off debt issuance costs of $828, resulting in a gain on extinguishment of debt of $6,203. During the second quarter of 2002, IVAX repurchased $20,000 of 4.5% Convertible Senior Subordinated Notes due 2008 for $15,363, plus accrued interest of $111, and wrote off debt issuance costs of $442, resulting in a gain on extinguishment of debt of $4,195.

     As described in Note 5, payments for the acquisition of QVAR are due through the third anniversary of the effective date. The payments carried no stated interest rate and were discounted at the risk free interest rate of 3.7% resulting in $73,709 of additional long-term debt as of June 30, 2002, including accretion of interest, of which $22,000 is current.

(7) INCOME TAXES:

     The provision for income taxes from continuing operations consists of the following:

		Three Months					Six Months
		2002		2001			2002		2001
Period Ended June 30,
Current:
	Domestic	$	5,062	$	29,562		$	7,242	$	40,706
	Foreign		6,083		3,217			10,974		6,943
Deferred			2,621		(16,568	)		1,362		(17,683	)
Total		$	13,766	$	16,211		$	19,578	$	29,966

     The effective tax rate during the first six months of 2002 is less than the statutory rate due primarily to low tax rates applicable to IVAX’ Puerto Rico and Waterford, Ireland manufacturing operations. Payment of the current tax provision for the year ended December 31, 2001, for domestic and foreign operations will be reduced by $926 and $370, respectively, representing the incremental impact of compensation expense deductions associated with non-qualified stock option exercises during the current quarter. These amounts were credited to “Capital in excess of par value”. As of June 30, 2002, a domestic net deferred tax asset of $100,372 and an aggregate foreign net deferred tax asset of $3,691 are included in “Other current assets” and “Other assets” in the accompanying consolidated balance sheet. Realization of the net deferred tax assets is dependent upon generating sufficient future domestic and foreign taxable income. Although realization is not assured, management believes it is more likely than not that the net deferred tax assets will be realized.

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(8) BUSINESS SEGMENT INFORMATION:

		Three Months						Six Months
		2002			2001			2002			2001
Revenues by Region
Period Ended June 30,
North America
	External sales	$	111,546		$	162,246		$	214,507		$	300,989
	Intersegment sales		276			77			552			463
	Other revenues		7,124			147			14,860			268
	Net revenues — North America		118,946			162,470			229,919			301,720
Europe
	External sales		80,906			75,910			166,189			146,198
	Intersegment sales		15,516			13,459			29,905			21,200
	Other revenues		8,651			13,684			17,191			28,889
	Net revenues — Europe		105,073			103,053			213,285			196,287
Latin America
	External sales		57,726			38,661			116,503			65,170
	Other revenues		430			306			830			535
	Net revenues — Latin America		58,156			38,967			117,333			65,705
Corporate & Other
	External sales		12,928			9,360			20,208			17,731
	Intersegment sales		(15,792	)		(13,536	)		(30,457	)		(21,663	)
	Other revenues		1,095			1,468			2,340			1,934
	Net revenues — Corporate & Other		(1,769	)		(2,708	)		(7,909	)		(1,998	)
Consolidated net revenues		$	280,406		$	301,782		$	552,628		$	561,714

		Three Months						Six Months
		2002			2001			2002			2001
Profits by Region
Period Ended June 30,
Income from continuing operations before minority interest:
	North America	$	16,419		$	62,543		$	29,992		$	97,629
	Europe		5,446			(10,382	)		14,888			(10,306	)
	Latin America		13,288			1,783			17,466			3,088
	Corporate & Other		(3,399	)		13,905			(11,386	)		37,669
Income from continuing operations
	Before minority interest		31,754			67,849			50,960			128,080
Net Income:
	Minority interest		(32	)		14			62			(85	)
	Cumulative effect of a change in accounting principle		—			—			4,161			—
Net income		$	31,722		$	67,863		$	55,183		$	127,995

		June 30,
		2002		2001
Long-Lived Assets:
	North America	$	306,290	$	70,267
	Europe		265,458		210,956
	Latin America		431,074		175,720
	Corporate & Other		110,048		111,572
Total		$	1,112,870	$	568,515

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(9) SHAREHOLDERS’ EQUITY:

     On March 5, 2002, IVAX elected the net share settlement method and issued 160 shares of IVAX’ common stock to settle one put option for 200 shares, bearing a strike price of $31.00, that expired on March 1, 2002. On April 4, 2002, IVAX elected the physical settlement method for one put option, and paid $4,750 to purchase 250 shares of IVAX’ common stock at a strike price of $19.00. On April 30, 2002, IVAX elected the physical settlement method for one put option, and paid $7,975 to purchase 250 shares of IVAX’ common stock at a strike price of $31.90. On May 15, 2002, IVAX elected the net share settlement method and issued 444 shares of IVAX’ common stock to settle one put option for 250 shares, bearing a strike price of $32.28, that expired on May 14, 2002. On May 22, 2002, IVAX elected the net share settlement method and issued 367 shares of IVAX’ common stock to settle one put option for 250 shares, bearing a strike price of $32.15, that expired on May 21, 2002.

     On March 15, 2002, IVAX’ Board of Directors expanded the authorization of our repurchase program by an additional 10,000 shares of common stock or a like-valued amount of IVAX’ convertible debentures.

(10) RECENTLY ISSUED ACCOUNTING STANDARDS:

     Statement of Financial Accounting Standards (“SFAS”) No. 143, Accounting for Asset Retirement Obligations, addresses financial accounting and reporting for obligations associated with the retirement of tangible long-lived assets. It is effective for fiscal years beginning after June 15, 2002. Management believes the impact of adoption of this statement will not be significant.

     SFAS No. 146, Accounting for Costs Associated with Exit or Disposal Activities, requires that a liability for a cost associated with an exit or disposal activity be recognized when the liability is incurred rather than when a commitment to an exit plan is made. It is effective for exit or disposal activities that are initiated after December 31, 2002. Management believes the impact of adoption of this statement will not be significant.

     Effective January 1, 2002, IVAX adopted SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, EITF Issue No. 00-25, Vendor Income Statement Characterization of Consideration Paid to a Reseller of the Vendor’s Products, and EITF Issue No. 01-09, Accounting for Consideration Given to a Customer or a Reseller of Vendor’s Products. The impact of adoption was not significant.

     In accordance with SFAS No. 141, Business Combinations, on January 1, 2002, $4,161 of negative goodwill recorded in the balance sheet as of December 31, 2001, was reversed through a cumulative effect of a change in accounting principle. In addition, a workforce in place intangible asset in the amount of $722 was reclassified to goodwill.

     Effective January 1, 2002, IVAX adopted SFAS No. 142, Goodwill and Other Intangible Assets. Intangible assets that have indefinite lives and goodwill are no longer amortized. This will increase net income by approximately $2,000 per quarter, or $8,000 per year. The life of one product intangible asset with a net book value of $6,519 as of January 1, 2002, was extended based on a review of the expected remaining estimated useful life. Intangible assets with indefinite lives were tested for impairment resulting in the write-down of one intangible asset by $177. The initial test for impairment of goodwill as of January 1, 2002, was completed during the second quarter and no impairments were indicated. An independent valuation firm was used to perform the test.

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     Goodwill and Other Intangible Assets — Adoption of SFAS No. 142:

		Three Months				Six Months
		2002		2001		2002		2001
Period Ended June 30,
Reported net income		$	31,722	$	67,863	$	55,183	$	127,995
Addback: Goodwill amortization					2,090				3,302
Addback: Workforce in place amortization					55				109
Adjust: Product intangible amortization					903				1,806
Adjusted net income		$	31,722	$	70,911	$	55,183	$	133,212
Basic earnings per common share:
	Reported net income	$	0.16	$	0.34	$	0.28	$	0.64
	Goodwill amortization				0.01				0.02
	Product intangible amortization				—				0.01
	Adjusted net income	$	0.16	$	0.35	$	0.28	$	0.67
Diluted earnings per common share:
	Reported net income	$	0.16	$	0.33	$	0.28	$	0.62
	Goodwill amortization				0.01				0.01
	Product intangible amortization				—				0.01
	Adjusted net income	$	0.16	$	0.34	$	0.28	$	0.64

     The following table displays the changes in the carrying amounts of goodwill by operating segment for the six months ended June 30, 2002:

		Balance		Foreign			Balance
		December 31,		Exchange and			June 30,
		2001		Other			2002
North America		$	3,972	$	—		$	3,972
Europe			24,200		7,015			31,215
Latin America			427,157		(95,521	)		331,636
Corporate and other			46,748		668			47,416
	Consolidated goodwill	$	502,077	$	(87,838	)	$	414,239

     During the second quarter of 2002, IVAX elected to early adopt SFAS No. 145, Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections. The impact of adoption was the reclassification into income from continuing operations of extraordinary losses from the early retirement of subordinated notes of $8,725 in 2000, an extraordinary gain of $7,120, net of taxes of $4,182, during the third quarter of 2001, an extraordinary gain of $3,413, net of taxes of $1,962, during the first quarter of 2002 and an extraordinary gain of $2,664, net of taxes of $1,531, during the second quarter of 2002.

(11) ACQUISITIONS:

     On February 9, 2001, IVAX indirectly acquired IVAX Pharmaceuticals Mexico, S.A. de C.V. (“IVAX Mexico”, formerly known as Laboratorios Fustery, S.A. de C.V.), a Mexican pharmaceutical company, by purchasing the outstanding securities of IVAX Mexico’s parent, Maancirkel Holding B.V., a corporation organized under the laws of The Netherlands, from Morcob CVA, an entity organized

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under the laws of Belgium, pursuant to a stock purchase agreement entered into among the parties on October 11, 2000. The operating results of IVAX Mexico are included in the consolidated financial statements subsequent to the February 9, 2001, acquisition date. During the second quarter of 2002, IVAX received a refund of $6,417 on the purchase price of IVAX Mexico, which reduced goodwill.

     On February 26, 2001, IVAX acquired the assets of a research organization located in the United States. The operating results of this company are included in the consolidated financial statements subsequent to its acquisition date.

     On March 13, 2001, IVAX acquired Netpharma Scandinavia AB (“Netpharma”), a Swedish pharmaceutical company. The operating results of Netpharma are included in the consolidated financial statements subsequent to its acquisition date.

     On April 3, 2001, IVAX acquired the remaining 70% of Indiana Protein Technologies, Inc. (“Indiana Protein”) that it did not already own. Indiana Protein was previously accounted for as an investment under the equity method of accounting. The operating results of Indiana Protein are included in the consolidated financial statements subsequent to its acquisition date.

     During the third quarter of 2001, IVAX acquired 99.9% of the outstanding shares and American Depositary Shares (“ADS”) of Laboratorio Chile S.A. (“Lab Chile”), a Chilean pharmaceutical company, in two tender offers for cash. The operating results of Lab Chile are included in the consolidated financial statements subsequent to its acquisition date.

     Proforma information for the above acquisitions as if the purchases occurred on January 1, 2001, is presented below.

	Three months		Six months
	2001		2001
Period Ended June 30,
Revenues	$	348,980	$	678,002
Net income		79,918		144,160
Diluted weighted average shares		207,605		207,785
Diluted earnings per share	$	0.38	$	0.69

     These proforma results of operations are not necessarily indicative of results that might have been achieved if the acquisitions had actually occurred on January 1, 2001.

(12) PARTIAL SALE OF IVAX DIAGNOSTICS, INC.:

     On March 14, 2001, IVAX’ wholly-owned subsidiary, IVAX Diagnostics, Inc., was merged with b2bstores.com, a non-operating company with approximately $22,285 of cash, resulting in IVAX owning approximately 70% of the newly merged public company. IVAX received 20,000 shares of b2bstores.com common stock in exchange for all of the outstanding shares of IVAX Diagnostics, Inc. and b2bstores.com’s name was changed to IVAX Diagnostics, Inc. For accounting purposes, this transaction was treated as a partial sale of IVAX Diagnostics, Inc. in exchange for cash of b2bstores.com. IVAX elected income statement recognition as its accounting policy for sales of subsidiary stock and recorded a gain of $10,278. Deferred taxes were not recorded related to the gain as it represents an outside basis difference and IVAX expects it can recover its investment in IVAX Diagnostics, Inc. tax-free. Also

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recorded was $1,041 of nondeductible compensation expense from outstanding options under the IVAX Diagnostics, Inc. 1999 Stock Option Plan converting to a fair value plan as a result of the merger. IVAX Diagnostics, Inc. is engaged in the development, manufacture and marketing of diagnostic test kits, reagents and instruments.

(13) LEGAL PROCEEDINGS:

     On January 11, 2002, two of the class action lawsuits containing allegations similar to those in the Louisiana Wholesale Drug Co. v. Abbott Laboratories, Geneva Pharmaceuticals, Inc. and Zenith Goldline Pharmaceuticals, Inc. case, previously reported in IVAX’ Annual Report on Form 10-K for the year ended December 31, 2001, were settled.

     In April 2002, we received notice of an investigation by United Kingdom National Health Service officials concerning prices charged by generic drug companies, including IVAX UK Limited, for penicillin-based antibiotics and warfarin sold in the United Kingdom from 1996 to 2000. This is an investigation by the Serious Fraud Office of the United Kingdom involving all pharmaceutical companies that sold these products in the United Kingdom during this period. According to statements by investigating agencies, this is a complex investigation expected to continue for some time and there is no indication from the agencies when or if charges will be made against any of these companies. The Company is cooperating fully with this investigation and believes its sales of these products have been in compliance with all applicable laws and regulations.

     On June 13, 2002, the Louisiana Wholesale Drug Co. v. Abbott Laboratories and Valley Drug Co. v. Abbott Laboratories et al. cases, previously reported in IVAX’ Annual Report on Form 10-K for the year ended December 31, 2001, were also settled.

(14) SUBSEQUENT EVENTS:

     From July 1, 2002, through July 26, 2002, IVAX repurchased 458 shares of its common stock at a total cost, including commissions, of $4,934.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

     The following discussion and analysis should be read in conjunction with the consolidated financial statements, the related notes to consolidated financial statements and management’s discussion and analysis of financial condition and results of operations included in our Annual Report on Form 10-K for the year ended December 31, 2001, and the unaudited interim consolidated financial statements and the related notes to unaudited interim consolidated financial statements included in Item 1 of this Quarterly Report on Form 10-Q.

Results of Operations

Six months ended June 30, 2002 compared to the six months ended June 30, 2001

     Net income for the six months ended June 30, 2002, was $55 million, or $.28 per diluted share, compared to $128 million, or $.62 per diluted share, for the same period of the prior year. Income from continuing operations for the six months ended June 30, 2002, was $51 million, or $.26 per diluted share, compared to $128 million, or $.62 per diluted share, for the same period of the prior year. As of January 1, 2002, we recorded a cumulative change in accounting principle credit in the amount of $4.2 million, or $.02 per diluted share, in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 141, Business Combinations.

Net Revenues and Gross Profit

     Net revenues for the six months ended June 30, 2002, totaled $553 million, a decrease of $9 million, or 2%, from the $562 million reported in the same period of the prior year. This decrease was comprised of decreases in net revenues of $72 million from North American subsidiaries and $6 million from other operations, partially offset by increases of $17 million from European subsidiaries and $52 million from Latin American subsidiaries.

     North American subsidiaries generated net revenues of $230 million for the six months ended June 30, 2002, compared to $302 million for the same period of the prior year. The $72 million, or 24%, decrease in net revenues was primarily attributable to decreased volume and lower prices of our paclitaxel product and higher sales returns and allowances, partially offset by increased volume and prices of certain brand-equivalent pharmaceutical products, increased sales of proprietary respiratory products and increased product development fees. North American subsidiaries recorded provisions for sales returns and allowances that reduced gross sales by $278 million during the six months ended June 30, 2002, and $139 million for the same period of the prior year. The increase of $139 million, or 100%, was primarily due to reduced net prices on certain brand-equivalent pharmaceutical products and increased sales volume.

     European subsidiaries generated net revenues of $213 million for the six months ended June 30, 2002, compared to $196 million for the same period of the prior year. The $17 million, or 9%, increase in net revenues was primarily due to higher sales volumes and favorable effects of currency exchange rates, partially offset by reduced product development fees and lower prices for certain brand-equivalent products. European subsidiaries recorded provisions for sales returns and allowances that reduced gross sales by $23 million during the six months ended June 30, 2002, and $17 million for the same period of the prior year.

     Latin American subsidiaries generated net revenues of $117 million for the six months ended June 30, 2002, compared to $65 million for the same period of the prior year. The $52 million, or 79%, increase was primarily due to the revenue generated by Laboratorio Chile S.A. (“Lab Chile”), which was

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acquired July 5, 2001, partially offset by unfavorable effects of currency exchange rates. Latin American subsidiaries recorded provisions for sales returns and allowances that reduced gross sales by $18 million during the six months ended June 30, 2002, and $3 million for the same period of the prior year. The $15 million, or 500%, increase was primarily due to the acquisition of Lab Chile.

     Gross profit was $253 million (46% of net revenues) for the six months ended June 30, 2002, compared to $295 million (52% of net revenues) for the same period of the prior year. The decrease in gross profit percentage was primarily attributable to reduced volume and pricing of our paclitaxel product. We are continuing to experience increased competition for paclitaxel as well as our brand equivalent albuterol products and the resulting pricing and volume pressures have negatively impacted and may continue to negatively impact our revenues and gross profits. Our results for the first six months of 2002 were also adversely impacted by a significant currency devaluation in Argentina, reductions in government purchases of our products in Mexico and continued pricing pressures in the United States and the United Kingdom. Revenues from the sale of our paclitaxel product did not contribute significantly to our revenues and gross profits during the first six months of 2002 and, because of the continuing price erosion and competition, are not likely to contribute significantly in the near future to our North American results. Our future net revenues and gross profits will depend upon:

• our ability to maintain our pricing and volume levels and obtain a consistent supply of raw materials for paclitaxel;

• our ability to obtain and maintain FDA approval of our manufacturing facilities;

• our ability to maintain a pipeline of products in development;

• our ability to develop and rapidly introduce new products;

• the timing of regulatory approval of such products;

• our ability to manufacture such products efficiently;

• the number and timing of regulatory approvals of competing products; and

• our ability to replace or renew license fees, royalties and development service fees as the related agreements expire or are terminated.

Operating Expenses

     Selling expenses increased $28 million, or 49%, to $86 million (16% of net revenues) for the six months ended June 30, 2002, compared to $58 million (10% of net revenues) for the same period of the prior year. The increase was due to higher expenses associated with the operations of Lab Chile and IVAX Pharmaceuticals Mexico, S.A. de C.V. (“IVAX Mexico”, formerly known as Laboratorios Fustery, S.A. de C.V.) and increased sales and promotional expenses at IVAX Laboratories, our U.S. proprietary respiratory subsidiary, and our European subsidiaries, partially offset by reduced sales and promotional expenses at Elvetium Argentina and favorable effects of foreign currency rates.

     General and administrative expenses increased $2 million, or 4%, to $55 million (10% of net revenues) for the six months ended June 30, 2002, compared to $53 million (9% of net revenues) for the same period of the prior year. The increase is primarily attributable to additional general and administrative expenses from the operations of Lab Chile and IVAX Mexico and increased expenses at North American pharmaceutical subsidiaries, partially offset by reduced expenses at Elvetium Argentina, favorable effects of foreign currency rates and lower professional fees at Corporate. In June 2002, we received $2.2 million in partial settlement of a vitamin price-fixing class action lawsuit. In addition, we paid $2.1 million to settle the Louisiana Wholesale Drug Co. v. Abbott Laboratories and Valley Drug Co. v. Abbott Laboratories et al. cases, previously reported in our Annual Report on Form 10-K for the year ended December 31, 2001.

     Research and development expenses for the six months ended June 30, 2002, decreased $2 million, or 4%, to a total of $37 million (7% of net revenues), compared to $39 million (7% of net revenues) for the same period of the prior year. Our future level of research and development

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expenditures will depend on, among other things, the outcome of clinical testing of products under development, delays or changes in government required testing and approval procedures, technological and competitive developments, strategic marketing decisions and liquidity.

     During the first six months of 2002, we incurred $2 million of restructuring costs, which were substantially paid out during the quarter, at two subsidiaries, consisting primarily of employee termination benefits.

Other Income (Expense)

     Interest income decreased $8 million and interest expense increased $10 million for the six months ended June 30, 2002, as compared to the same period of the prior year primarily due to the cash purchases of Lab Chile on July 5, 2001, and Nasarel and Nasalide on October 16, 2001, and the issuance of $725 million of 4.5% Convertible Senior Subordinated Notes in 2001.

     Other income, net increased $13 million for the six months ended June 30, 2002, compared to the same period of the prior year. During January 2002, we repaid $48 million of U.S. denominated loans held by an Argentine subsidiary resulting in a pretax foreign exchange loss of approximately $2.8 million, which was partially offset by foreign currency gains at other subsidiaries. During the second quarter, we reclassified $5.3 million of first quarter extraordinary gains on the repurchase of subordinated notes into other income in accordance with the early adoption of SFAS No. 145, Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections. During the second quarter of 2002, we realized a gain of $4.2 million on the repurchase of subordinated notes, earned a $4.3 million milestone as additional consideration for the sale of Elmiron to ALZA Corporation during 1997, which is to be received in the first quarter of 2003, and recorded a gain of $6.3 million on the sale of certain intangible assets in the Czech Republic, which proceeds are due under the contract in the third quarter of 2002. These gains were partially offset by net foreign currency losses at various subsidiaries.

     On March 14, 2001, we sold a partial interest in IVAX Diagnostics, Inc. through a merger with b2bstores.com, Inc. resulting in a gain of $10.3 million.

Three months ended June 30, 2002 compared to the three months ended June 30, 2001

     Net income for the three months ended June 30, 2002, was $32 million, or $.16 per diluted share, compared to $68 million, or $.33 per diluted share, for the same period of the prior year.

Net Revenues and Gross Profit

     Net revenues for the three months ended June 30, 2002, totaled $280 million, a decrease of $22 million, or 7%, from the $302 million reported in the same period of the prior year. This decrease was comprised of a reduction in net revenues of $44 million from North American subsidiaries, partially offset by increases in net revenues of $2 million from European subsidiaries, $19 million from Latin American subsidiaries and $1 million from other operations.

     North American subsidiaries generated net revenues of $119 million for the three months ended June 30, 2002, compared to $163 million for the same period of the prior year. The 27% decrease was primarily attributable to decreased volume and lower prices of our paclitaxel product and higher sales returns and allowances, partially offset by increased volume and prices of certain brand-equivalent pharmaceutical products,

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increased sales of proprietary respiratory products and increased product development fees. North American subsidiaries recorded provisions for sales returns and allowances that reduced gross sales by $146 million during the three months ended June 30, 2002, and $81 million for the same period of the prior year. The increase of $65 million, or 80%, was primarily due to reduced net prices on certain brand-equivalent pharmaceutical products and increased sales volume.

     European subsidiaries generated net revenues of $105 million for the three months ended June 30, 2002, compared to $103 million for the same period of the prior year. The 2% increase was primarily due to higher sales volumes and favorable effects of currency exchange rates, partially offset by reduced product development fees and lower prices for certain brand-equivalent products. European subsidiaries recorded provisions for sales returns and allowances that reduced gross sales by $11 million during the three months ended June 30, 2002, and $7 million for the same period of the prior year.

     Latin American subsidiaries generated net revenues of $58 million for the three months ended June 30, 2002, compared to $39 million for the same period of the prior year. The 49% increase was primarily due to the revenue generated by Lab Chile, which was acquired July 5, 2001, partially offset by reduced sales volume in Mexico and unfavorable effects of currency exchange rates. Latin American subsidiaries recorded provisions for sales returns and allowances that reduced gross sales by $8 million during the three months ended June 30, 2002, and $1 million for the same period of the prior year. The $7 million, or 700%, increase was primarily due to the acquisition of Lab Chile.

     Gross profit was $131 million (47% of net revenues) for the three months ended June 30, 2002, compared to $158 million (53% of net revenues) for the same period of the prior year. The decrease in gross profit percentage was primarily attributable to reduced volume and pricing of our paclitaxel product. We are continuing to experience increased competition for paclitaxel as well as our brand equivalent albuterol products and the resulting pricing and volume pressures have negatively impacted and may continue to negatively impact our revenues and gross profits. Our results this quarter were also adversely impacted by a significant currency devaluation in Argentina and by reductions in government purchases of our products in Mexico.

Operating Expenses

     Selling expenses increased $14 million, or 45%, to $44 million (16% of net revenues) for the three months ended June 30, 2002, compared to $30 million (10% of net revenues) for the same period of the prior year. The increase was due to higher expenses associated with the operations of Lab Chile and IVAX Mexico and increased sales and promotional expenses at IVAX Laboratories and our European subsidiaries, partially offset by reduced sales and promotional expenses at Elvetium Argentina and favorable effects of foreign currency rates.

     General and administrative expenses decreased $2 million, or 5%, to $27 million (10% of net revenues) for the three months ended June 30, 2002, compared to $29 million (10% of net revenues) for the same period of the prior year. The decrease is primarily attributable to reduced general and administrative expenses at Elvetium Argentina, favorable effects of foreign currency rates and lower professional fees at Corporate, partially offset by increased expenses at North American pharmaceutical subsidiaries and general and administrative expenses from the operation of Lab Chile. In June 2002, we received $2.2 million in partial settlement of a vitamin price-fixing class action lawsuit. In addition, we paid $2.1 million to settle the Louisiana Wholesale Drug Co. v. Abbott Laboratories and Valley Drug Co. v. Abbott Laboratories et al. cases, previously reported in our Annual Report on Form 10-K for the year ended December 31, 2001.

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     Research and development expenses for the three months ended June 30, 2002, decreased $2 million, or 8%, to $18 million (7% of net revenues), compared to the same period of the prior year. Our future level of research and development expenditures will depend on, among other things, the outcome of clinical testing of products under development, delays or changes in government required testing and approval procedures, technological and competitive developments, strategic marketing decisions and liquidity.

     During the second quarter of 2002, we incurred $2 million of restructuring costs, which were substantially paid out during the quarter, at two subsidiaries, consisting primarily of employee termination benefits.

Other Income (Expense)

     Interest income decreased $7 million and interest expense increased $2 million for the three months ended June 30, 2002, compared to the same period of the prior year primarily due to the cash purchases of Lab Chile on July 5, 2001, and Nasarel and Nasalide on October 16, 2001, and the issuance of $725 million of 4.5% Convertible Senior Subordinated Notes in 2001.

     Other income, net increased $10 million for the three months ended June 30, 2002, compared to the same period of the prior year. During the second quarter of 2002, we realized a gain of $4.2 million on the repurchase of subordinated notes, earned a $4.3 million milestone as additional consideration for the sale of Elmiron to ALZA Corporation during 1997, which is to be received in the first quarter of 2003, and recorded a gain of $6.3 million on the sale of certain intangible assets in the Czech Republic, which proceeds are due under the contract in the third quarter of 2002.

Recently Issued Accounting Standards

     Statement of Financial Accounting Standards (“SFAS”) No. 143, Accounting for Asset Retirement Obligations, addresses financial accounting and reporting for obligations associated with the retirement of tangible long-lived assets. It is effective for fiscal years beginning after June 15, 2002. Management believes the impact of adoption of this statement will not be significant.

     SFAS No. 146, Accounting for Costs Associated with Exit or Disposal Activities, requires that a liability for a cost associated with an exit or disposal activity be recognized when the liability is incurred rather than when a commitment to an exit plan is made. It is effective for exit or disposal activities that are initiated after December 31, 2002. Management believes the impact of adoption of this statement will not be significant.

     Effective January 1, 2002, we adopted SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, EITF Issue No. 00-25, Vendor Income Statement Characterization of Consideration Paid to a Reseller of the Vendor’s Products, and EITF Issue No. 01-09, Accounting for Consideration Given to a Customer or a Reseller of Vendor’s Products. The impact of adoption was not significant.

     In accordance with SFAS No. 141, Business Combinations, on January 1, 2002, $4.2 million of negative goodwill recorded in the balance sheet as of December 31, 2001, was reversed through a

20

cumulative effect of a change in accounting principle. In addition, a workforce in place intangible asset in the amount of $.7 million was reclassified to goodwill.

     Effective January 1, 2002, we adopted SFAS No. 142, Goodwill and Other Intangible Assets. Intangible assets that have indefinite lives and goodwill are no longer amortized. This will increase net income by approximately $2 million per quarter, or $8 million per year. The life of one product intangible asset with a net book value of $6.5 million as of January 1, 2002, was extended based on a review of the expected remaining estimated useful life. Intangible assets with indefinite lives were tested for impairment resulting in the write-down of one intangible asset by $.2 million. The initial test for impairment of goodwill as of January 1, 2002, was completed during the second quarter and no impairments were indicated. An independent valuation firm was used to perform the test.

     Goodwill and Other Intangible Assets — Adoption of SFAS No. 142 (in thousands, except per share amounts):

		Three Months				Six Months
		2002		2001		2002		2001
Period Ended June 30,
Reported net income		$	31,722	$	67,863	$	55,183	$	127,995
Addback: Goodwill amortization					2,090				3,302
Addback: Workforce in place amortization					55				109
Adjust: Product intangible amortization					903				1,806
Adjusted net income		$	31,722	$	70,911	$	55,183	$	133,212
Basic earnings per common share:
	Reported net income	$	0.16	$	0.34	$	0.28	$	0.64
	Goodwill amortization				0.01				0.02
	Product intangible amortization				—				0.01
	Adjusted net income	$	0.16	$	0.35	$	0.28	$	0.67
Diluted earnings per common share:
	Reported net income	$	0.16	$	0.33	$	0.28	$	0.62
	Goodwill amortization				0.01				0.01
	Product intangible amortization				—				0.01
	Adjusted net income	$	0.16	$	0.34	$	0.28	$	0.64

     The following table displays the changes in the carrying amounts of goodwill by operating segment for the six months ended June 30, 2002 (in thousands):

		Balance		Foreign			Balance
		December 31,		Exchange and			June 30,
		2001		Other			2002
North America		$	3,972	$	—		$	3,972
Europe			24,200		7,015			31,215
Latin America			427,157		(95,521	)		331,636
Corporate and other			46,748		668			47,416
	Consolidated goodwill	$	502,077	$	(87,838	)	$	414,239

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     During the second quarter of 2002, IVAX elected to early adopt SFAS No. 145, Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections. The impact of adoption was the reclassification into income from continuing operations of extraordinary losses from the early retirement of subordinated notes of $8.7 million in 2000, an extraordinary gain of $7.1 million, net of taxes of $4.2 million, during the third quarter of 2001, an extraordinary gain of $3.4 million, net of taxes of $2.0 million, during the first quarter of 2002 and an extraordinary gain of $2.7 million, net of taxes of $1.5 million, during the second quarter of 2002.

Liquidity and Capital Resources

     At June 30, 2002, working capital was $477 million compared to $598 million at December 31, 2001. Cash and cash equivalents were $149 million at June 30, 2002, compared to $178 million at December 31, 2001. Short-term marketable securities were $26 million at June 30, 2002 compared to $155 million at December 31, 2001.

     Net cash of $44 million was provided by operating activities during the first six months of 2002 compared to $93 million during the same period of the prior year. The decrease in cash provided by operating activities was primarily the result of reduced operating earnings and increases in inventories and payments of accounts payable, partially offset by increased collections of accounts receivable and decreases in other assets.

     Net cash of $72 million was provided by investing activities during the first six months of 2002 compared to $323 million used for investing activities during the same period of the prior year. During the first six months of 2002, our capital expenditures increased by approximately $11 million as compared to the same period of the prior year. During the first six months of 2001, we also received $45 million in proceeds from the sale of assets. During the first six months of 2002 we spent $26 million to acquire intangible assets, net of $6.4 million refund of purchase price from the acquisition of IVAX Mexico, compared to $109 million to acquire intangible assets and businesses and increase our ownership interest in affiliates during the same period of the prior year. During the first six months of 2002, we received $126 million net proceeds from the sale of marketable securities compared to using $238 million to acquire marketable securities during the same period of the prior year.

     On March 1, 2002, we acquired from Syntex Pharmaceuticals International Ltd. the non-U.S. rights to pharmaceutical products containing flunisolide hemihydrate, sold under the tradenames Syntaris, Nasalide, Rhinalar, Locasyn and Lokilan, for 10.2 million Swiss francs ($6.0 million at the February 28, 2002, currency exchange rate). During April 2002, we entered into an agreement to acquire the technical files and French marketing authorizations to substantially all of the products comprising the generic pharmaceutical business of Merck & Co., Inc.’s subsidiary in France for total consideration of approximately $5 million payable half on signing and half in four months. On July 19, 2002, the agreement was amended reducing the second payment to 2.6 million Euros ($2.5 million as of the August 2, 2002, payment date). We also acquired an exclusive U.S. license to the patent rights to market QVAR™ (beclomethasone dipropionate HFA), an aerosol inhaler prescribed to treat asthma. In addition, we have an option to obtain ownership of the U.S. QVAR trademark, as well as related patents and the New Drug Application in five years. 3M Drug Delivery Systems will manufacture the QVAR product for us under a long-term contract. The total consideration due under the contract, including options and extensions, is $105 million, $21 million of which was paid on the effective date, $22 million is due on the first anniversary, $31 million is due on the second anniversary, $26 million is due on the third anniversary and $5 million is due on the fifth anniversary upon exercise of the option. The payments carry no stated interest rate and were discounted at the risk free rate of 3.7%.

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     Net cash of $130 million was used by financing activities during the first six months of 2002 compared to $659 million provided by financing activities during the same period of the prior year primarily reflecting the $725 million Convertible Senior Subordinated Notes sold in May of 2001. During the first six months of 2002, we repaid $48 million of bank debt and repurchased $55 million of our convertible debentures for $44.2 million, but reduced our repurchases of common stock by $8 million compared to the same period of the prior year. On March 15, 2002, our Board of Directors expanded the authorization of our repurchase program by an additional 10 million shares of our common stock or a like-valued amount of our convertible debentures.

     We plan to spend substantial amounts of capital in 2002 to continue the research and development of pharmaceutical products. Although research and development expenditures are expected to be between $80 million and $90 million during 2002, actual expenditures will depend on, among other things, the outcome of clinical testing or products under development, delays or changes in government required testing and approval procedures, technological and competitive developments, strategic marketing decisions and liquidity. In addition, we plan to spend between $80 million and $90 million in 2002 to improve and expand our pharmaceutical and other related facilities.

     Our principal sources of short-term liquidity are existing cash and internally generated funds, which we believe will be sufficient to meet our operating needs and anticipated capital expenditures over the short term. For the long term, we intend to utilize principally internally generated funds, which are anticipated to be derived primarily from the sale of existing pharmaceutical products and pharmaceutical products currently under development. There can be no assurance that we will successfully complete products under development, that we will be able to obtain regulatory approval for any such products, or that any approved product will be produced in commercial quantities, at reasonable costs, and be successfully marketed. We may consider issuing debt or equity securities in the future to fund potential acquisitions and growth.

Income Taxes

     We recognized a $19.6 million tax provision for the six months ended June 30, 2002, of which $11.8 million related to foreign operations. The effective tax rate during the first quarter of 2002 is less than the statutory rate due primarily to low tax rates applicable to our Puerto Rico and Waterford, Ireland manufacturing operations.

     As of June 30, 2002, domestic net deferred tax assets totaled $100.4 million and aggregate foreign net deferred tax assets totaled $3.7 million. Realization of the net deferred tax assets is dependent upon generating sufficient future domestic and foreign taxable income. Although realization is not assured, we believe it is more likely than not that the net deferred tax assets will be realized. Our estimates of future taxable income are subject to revision due to, among other things, regulatory and competitive factors affecting the pharmaceutical industries in the markets in which we operate. Such factors are further discussed in management’s discussion and analysis of financial condition and results of operations included in our Annual Report on Form 10-K for the year ended December 31, 2001.

Critical Accounting Policies

     Revenue Recognition, Sales Returns and Allowances — Revenues and the related cost of sales are recognized at the time product is shipped. Our pharmaceutical revenues are affected by the level of provisions for estimated returns, inventory credits, discounts, promotional allowances, volume rebates

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and chargebacks, as well as other sales allowances. The custom in the pharmaceutical industry is generally to grant customers the right to return purchased goods. In the brand equivalent pharmaceutical industry, this custom has resulted in a practice of suppliers issuing inventory credits (also known as shelf-stock adjustments) to customers based on the customers’ existing inventory following decreases in the market price of the related brand equivalent pharmaceutical product. We have contractual agreements with many of our customers which require that we grant these customers inventory credit following a price decrease. In other cases, the determination to grant a credit is at our discretion. These credits allow customers with established inventories to compete with those buying product at the current market price, and allow us to maintain shelf space, market share and customer loyalty.

     Provisions for estimated returns, inventory credits and chargebacks, as well as other sales allowances, are established by us concurrently with the recognition of revenue. The provisions are established in accordance with generally accepted accounting principles based upon consideration of a variety of factors, including actual return and inventory credit experience for products during the past several years by product type, the number and timing of regulatory approvals for the product by our competitors (both historical and projected), the market for the product, expected sell-through levels by our wholesaler customers to customers with contractual pricing arrangements with us, estimated customer inventory levels by product and projected economic conditions. Actual product returns and inventory credits incurred are, however, dependent upon future events, including price competition and the level of customer inventories at the time of any price decreases. We continually monitor the factors that influence the pricing of our products and customer inventory levels and make adjustments to these provisions when we believe that actual product returns, inventory credits and other allowances may differ from established reserves.

     Legal Costs — Legal charges are recorded for the costs anticipated to be incurred in connection with litigation and claims against us when we can reasonably estimate these costs. We intend to vigorously defend each of the lawsuits described in Note 13, Commitments and Contingencies, in the notes to consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2001, and in Part II Item 1 of this Form 10-Q but their respective outcomes cannot be predicted. Any of such lawsuits or investigations, if determined adversely to us, could have a material adverse effect on our financial position and results of operations. Our ultimate liability with respect to any of these proceedings is not presently determinable.

     We are involved in various other legal proceedings arising in the ordinary course of business, some of which involve substantial amounts. In order to obtain brand equivalent approvals prior to the expiration of patents on branded products, and to benefit from the exclusivity allowed to Abbreviated New Drug Application applicants that successfully challenge these patents, we frequently become involved in patent infringement litigation brought by branded pharmaceutical companies. Although these lawsuits involve products that are not yet marketed and therefore pose little or no risk of liability for damages, the legal fees and costs incurred in defending such litigation can be substantial. While it is not feasible to predict or determine the outcome or the total cost of these proceedings, in our opinion, based on a review with legal counsel, any losses resulting from such legal proceedings will not have a material adverse impact on our financial position or results of operations.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

     Market risk represents the risk of loss that may impact our consolidated financial position, results of operations or cash flows. We, in the normal course of doing business, are exposed to the risks associated with foreign currency exchange rates and changes in interest rates.

     Foreign Currency Exchange Rate Risk — We have subsidiaries in more than 20 countries worldwide. During the six months ended June 30, 2002, sales outside the United States accounted for approximately 61% of worldwide sales. Virtually all of these sales were denominated in currencies of the local country. As such, our reported profits and cash flows are exposed to changing exchange rates. If the United States dollar weakens relative to the foreign currency, the earnings generated in the foreign currency will, in effect, increase when converted into United States dollars and vice versa. Although we do not speculate in the foreign exchange market, we do from time to time manage exposures that arise in the normal course of business related to fluctuations in foreign currency exchange rates by entering into offsetting positions through the use of foreign exchange forward contracts. As a result of exchange rate differences, net revenues decreased by $8 million for the six months ended June 30, 2002, as compared to the same period of the prior year. The effects of inflation on consolidated net revenues and operating income were not significant. Certain firmly committed transactions are hedged with foreign exchange forward contracts. As exchange rates change, gains and losses on the exposed transactions are partially offset by gains and losses related to the hedging contracts. Both the exposed transactions and the hedging contracts are translated at current spot rates, with gains and losses included in earnings. Our derivative activities, which primarily consist of foreign exchange forward contracts, are initiated primarily to hedge forecasted cash flows that are exposed to foreign currency risk.

     The foreign exchange forward contracts generally require us to exchange local currencies for foreign currencies based on pre-established exchange rates at the contracts’ maturity dates. If the counterparties to the exchange contracts do not fulfill their obligations to deliver the contracted currencies, we could be at risk for currency related fluctuations. We enter into these contracts with counterparties that we believe to be creditworthy and do not enter into any leveraged derivative transactions. As of June 30, 2002, we had $15.4 million in foreign exchange forward contracts outstanding. During January 2002, we repaid $48 million of United States dollar denominated bank loans of the Argentine operations assumed in the acquisition of Lab Chile resulting in a pretax loss of $2.8 million.

     Interest Rate Risk — Our only material debt obligations relate to the 4.5% and 5.5% Convertible Notes, which bear fixed rates of interest, and the amounts we owe for the purchase of QVAR, which carry no stated interest rate. We believe that our exposure to market risk relating to interest rate risk is not material.

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Disclosure Regarding Forward-Looking Statements

     We caution the reader that certain important factors may affect our actual results and could cause such results to differ materially from any forward-looking statement which may have been deemed to have been made in this report or which are otherwise made by us or on our behalf. For this purpose any statements contained in this report that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as “may”, “will”, “expect”, “believe”, “anticipate”, “intend”, “could”, “would”, “estimate”, “continue” or “pursue”, or the negative other variations thereof or comparable terminology are intended to identify forward-looking statements. Forward-looking statements involve risks and uncertainties that cannot be predicted or quantified and, consequently, actual results may differ materially from those expressed or implied by such forward-looking statements. Such risks and uncertainties include, among other things:

• difficulties in product development and uncertainties related to the timing or outcome of product development;

• the availability on commercially reasonable terms of raw materials, particularly raw materials for our paclitaxel product, and other third-party sourced products;

• our dependence on sole or limited source suppliers and the risk associated with a production interruption or shipment delays at such suppliers;

• difficulties in manufacturing products;

• efficacy or safety concerns with respect to marketed products, whether or not scientifically justified, leading to recalls, withdrawals or declining sales;

• that our proposed spending on facilities improvement and expansion may not be as projected;

• our ability to obtain and maintain FDA approval of our manufacturing facilities, the failure of which could result in production stoppage or delays;

• our ability to obtain approval from the FDA to market new pharmaceutical products;

• the acceptance of new products by the medical community as effective as alternative forms of treatment for indicated conditions;

• the outcome of any pending or future litigation or investigation (including patent, trademark and copyright litigation and the United Kingdom National Health Service investigation), and the cost, expenses and possible diversion of management’s time and attention arising from such litigation or investigation;

• the impact of new regulations or court decisions regarding the protection of patents and the exclusivity period for the marketing of branded drugs;

• the impact of the adoption of certain accounting standards;

• our success in acquiring or licensing proprietary technologies that are necessary for our product development activities;

• our ability to obtain and maintain a sufficient supply of products to meet market demand;

• the impact of political and economic instability in the countries in which we operate, particularly Argentina and other Latin American countries;

• our successful compliance with extensive, costly, complex and evolving governmental regulations and restrictions;

• our ability to successfully compete in both the branded and brand-equivalent pharmaceutical sectors; and

• other risks and uncertainties detailed herein and from time to time in our Securities and Exchange Commission filings.

     The information in this Form 10-Q is as of June 30, 2002 or, where clearly indicated, as of the date of this filing. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. We also may make additional disclosures in our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K that we may file from time to time with the Securities and Exchange Commission. Please

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also note that we provide a cautionary discussion of risks and uncertainties under the section entitled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2001. These are factors that we think could cause our actual results to differ materially from expected results. Other factors besides those listed here could also adversely affect us.

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PART II — OTHER INFORMATION

Item 1. Legal Proceedings

     On June 13, 2002, the Louisiana Wholesale Drug Co. v. Abbott Laboratories and Valley Drug Co. v. Abbott Laboratories et al. cases, previously reported in our Annual Report on Form 10-K for the year ended December 31, 2001, were settled.

     In April 2002, we received notice of an investigation by United Kingdom National Health Service officials concerning prices charged by generic drug companies, including IVAX UK Limited, for penicillin-based antibiotics and warfarin sold in the United Kingdom from 1996 to 2000. This is an investigation by the Serious Fraud Office of the United Kingdom involving all pharmaceutical companies that sold these products in the United Kingdom during this period. According to statements by investigating agencies, this is a complex investigation expected to continue for some time and there is no indication from the agencies when or if charges will be made against any of these companies. The Company is cooperating fully with this investigation and believes its sales of these products have been in compliance with all applicable laws and regulations.

Item 4. Submission of Matters to a Vote of Security Holders

     Our annual meeting of shareholders was held on June 27, 2002. The following is a summary of the matters voted on at that meeting:

     The shareholders elected nine Directors, constituting the entire Board of Directors, to serve until the next annual meeting of shareholders and until their respective successors are duly elected and qualified. The persons elected to our Board of Directors and the number of votes cast for and withheld for each nominee for director were as follows:

Director	For		Withheld
Mark Andrews		168,378,084		4,852,551
Ernst Biekert, Ph.D.		169,236,083		3,994,552
Charles M. Fernandez		168,339,098		4,891,537
Jack Fishman, Ph.D.		167,787,138		5,443,497
Neil Flanzraich		151,651,825		21,578,810
Phillip Frost, M.D.		151,665,727		21,564,908
Jane Hsiao, Ph.D.		151,664,290		21,586,345
Isaac Kaye		151,612,620		21,618,015
Richard C. Pfenniger, Jr.		168,695,694		4,534,941

     In May 2002, Richard C. Pfenninger, Jr., the Chief Executive Officer, Vice Chairman and a Director of Whitman Education Group, Inc., was appointed to IVAX Audit Committee. Phillip Frost, M.D., our Chairman and Chief Executive Officer, continues to serve on the Compensation Committee and is the Chairman of the Board of Directors at Whitman.

Item 6. Exhibits and Reports on Form 8-K

     (a)  Exhibits

3.2	Amended and Restated Bylaws	Filed herewith.
99.1	Certificate of the Chairman and Chief Executive Officer of IVAX Corporation pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	Filed herewith.
99.2	Certificate of the Chief Financial Officer of IVAX Corporation pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	Filed herewith.

     (b)  Reports on Form 8-K

     On May 15, 2002, we filed a report under Item 5 — Other Events on Form 8-K reporting our issuance of 444,000 shares of our common stock in settlement of certain put option obligations.

     On May 22, 2002, we filed a report on Form 8-K, as amended by Form 8-K/A filed on May 24, 2002, under Item 4 — Changes in Registrant’s Certifying Accountant reporting that our Board of Directors selected Ernst & Young LLP as our independent auditors replacing Arthur Andersen LLP and under Item 5 — Other Events reporting our issuance of 367,700 shares of our common stock in settlement of certain put option obligations.

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Signatures

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		IVAX Corporation
Date:	August 13, 2002	By: /s/ Thomas E. Beier
		Thomas E. Beier Senior Vice President-Finance Chief Financial Officer

29 EX-3.2 3 g77546exv3w2.txt AMENDED AND RESTATED BY LAWS EXHIBIT 3.2 BYLAWS OF IVAX CORPORATION a Florida corporation TABLE OF CONTENTS

Page ---- ARTICLE I -- Meetings of Shareholders.........................................................................1 Section 1. Annual Meeting............................................................................1 Section 2. Special Meeting...........................................................................1 Section 3. Place.....................................................................................2 Section 4. Notice....................................................................................2 Section 5. Shareholder Quorum........................................................................2 Section 6. Shareholder Voting........................................................................3 Section 7. Fixing Record Dates.......................................................................3 Section 8. Proxies...................................................................................3 Section 9. Notification of Nomination of Directors...................................................3 Section 10. Notice of Business at Annual Meetings....................................................4 ARTICLE II -- Directors.......................................................................................5 Section 1. Function..................................................................................5 Section 2. Compensation..............................................................................5 Section 3. Presumption of Assent.....................................................................6 Section 4. Number of Directors.......................................................................6 Section 5. Term of Office............................................................................6 Section 6. Election of Directors.....................................................................6 Section 7. Vacancies.................................................................................6 Section 8. Removal of Directors......................................................................6 Section 9. Quorum and Transaction of Business........................................................6 Section 10. Place of Meeting.........................................................................7 Section 11. Time, Notice and Call of Meetings........................................................7 Section 12. Action Without a Meeting.................................................................7 ARTICLE III -- Committees.....................................................................................7 Section 1. Executive Committee.......................................................................7 Section 2. Meetings of Executive Committee...........................................................8 Section 3. Other Committees..........................................................................8 ARTICLE IV -- Officers........................................................................................8 Section 1. General Provisions........................................................................8 Section 2. Term of Office............................................................................9 Section 3. Chairman of the Board.....................................................................9 Section 4. Chief Executive Officer...................................................................9 Section 5. President.................................................................................9

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Section 6. Secretary.................................................................................9 Section 7. Duties of Officers May be Delegated.......................................................9 Section 8. Removal of Certain Officers...............................................................9 ARTICLE V -- Share Certificate and Seal.......................................................................10 Section 1. Form and Execution........................................................................10 Section 2. Registration of Transfer..................................................................10 Section 3. Lost, Stolen or Destroyed Certificates...................................................10 Section 4. Seal......................................................................................10 ARTICLE VI -- Distributions...................................................................................11 ARTICLE VII -- Miscellaneous Provisions.......................................................................11 Section 1. Fiscal Year...............................................................................11 Section 2. Resignation...............................................................................11 Section 3. Voting Upon Stocks of Other Corporations..................................................11 ARTICLE VIII -- Corporate Records, Shareholders' Inspection Rights; Financial Information.....................11 Section 1. Corporate Records.........................................................................11 Section 2. Shareholders' Inspection Rights...........................................................12 Section 3. Financial Statements for Shareholders.....................................................13 Section 4. Other Reports to Shareholders.............................................................13 ARTICLE IX -- Indemnification.................................................................................14 Section 1. Right to Indemnification..................................................................14 Section 2. Advancement of Expenses...................................................................14 Section 3. Procedure for Indemnification and Obtaining Advancement of Expenses.......................14 Section 4. Other Rights, Continuation of Right to Indemnification and Advancements...................15 Section 5. Insurance.................................................................................15 Section 6. Savings Clause............................................................................15 Section 7. Terms.....................................................................................16 ARTICLE X -- Amendment........................................................................................17

ii IVAX CORPORATION BYLAWS ARTICLE I MEETINGS OF SHAREHOLDERS SECTION 1. ANNUAL MEETING. The annual meeting of shareholders for the election of directors and for the transaction of such other business as may properly come before the meeting shall be held on the date, time and place designated by the Board of Directors. SECTION 2. SPECIAL MEETING. (a) Special meetings of the shareholders shall be held when directed by the Chairman of the Board or the Board of Directors or when requested in writing by shareholders holding at least 50% of the corporation's stock having the right and entitled to vote at such meeting. The call for the meeting shall be issued by the secretary, unless the Chairman of the Board, the Board of Directors or the shareholders requesting the calling of the meeting designate another person to do so. Only business within the purposes described in the notice required in Section 4 of this Article I may be conducted at a special shareholders' meeting. (b) Any shareholder of record seeking to have the shareholders request a special meeting may, by written notice to the secretary, request the Board of Directors to fix a record date pursuant to Section 7 of this Article I. The Board of Directors shall promptly, but in all events within 10 business days after the date upon which such a request is received, adopt resolutions fixing the record date. In the event of the delivery, in the manner provided by Section 7 of this Article I, to the corporation of such a request or requests and/or any related revocation or revocations, the corporation shall engage nationally recognized independent inspectors of elections for the purpose of promptly performing a ministerial review of the validity of the requests and revocations. Every written request for a special meeting shall set forth the purpose or purposes for which the special meeting is requested, the name and address, as they appear in the corporation's books, of each shareholder making the request, the class and number of shares of the corporation which are owned of record by each such shareholder, and shall bear the date of signature of each such shareholder. No such request shall be effective to request such a meeting unless, within 60 days of any record date established in accordance with Section 7 of this Article I, a written request signed by a sufficient number of record holders as of such date to request a special meeting in accordance with Section 2(a) of this Article I and, if applicable, the Articles of Incorporation are delivered to the corporation in the manner prescribed in this Article I. For the purposes of permitting a prompt ministerial review by the independent inspectors, no request by shareholders for a special meeting shall be effective until such date as the independent inspectors certify to the corporation that the requests delivered to the corporation in accordance with this Article I represent at least the minimum number of shares that would be necessary to request such meeting. Within 10 business days after the independent inspectors deliver such a certified report to the corporation, the Board of Directors shall adopt a resolution calling a special meeting of the shareholders and fixing a record date for such meeting in accordance with Section 7 of this Article I. In setting a meeting date, the Board of Directors may consider such factors as it deems relevant within the good faith exercise of its business judgment including, without limitation, the nature of the action proposed to be taken, the facts and circumstances surrounding the request, and any plan of the Board of Directors to call a special or annual meeting of shareholders for the conduct of related business. Nothing contained in this section shall in any way be construed to suggest or imply that the Board of Directors or any shareholder shall not be entitled to contest the validity of any request or revocation thereof, or to take any other action including, without limitation, the commencement, prosecution or defense of any litigation with respect thereto. SECTION 3. PLACE. Meetings of the shareholders shall be held at the principal office of the corporation or as determined by the Chairman of the Board, unless otherwise designated by resolution from time to time by the Board of Directors. SECTION 4. NOTICE. A written notice of each meeting of shareholders, signed by the secretary, president or the person authorized to call the meeting, shall be mailed to each shareholder having the right and entitled to vote at the meeting at the address as it appears on the records of the corporation, not less than 10 nor more than 60 days before the date set for the meeting. The notice shall state the time and place the meeting is to be held. A notice of a special meeting shall also state the purposes of the meeting. A notice of meeting shall be sufficient for that meeting and any adjournment of it. If a shareholder transfers any shares after the notice is sent, it shall not be necessary to notify the transferee. All shareholders may waive notice of a meeting before, at or after the meeting. SECTION 5. SHAREHOLDER QUORUM. Except as otherwise required by law, or by the Articles of Incorporation, a majority of the shares entitled to vote, represented in person or by proxy, shall constitute a quorum at a meeting of shareholders. Any number of shareholders, even if less than a quorum, may adjourn the meeting from time to time and place to place without further notice until a quorum is obtained. When a specified item of business is required to be voted on separately by a particular class or series of stock, the presence of a majority of the shares of such class or series shall constitute a quorum for the transaction of such item of business by that class or series, except as otherwise required by law, by the Articles of Incorporation or by the terms of the particular class or series of shares. If less than a quorum of shares entitled to vote on a matter, as above defined, shall be present at the time and place for which a meeting shall be called, the Chairman of the Board, or secretary or the holders of a majority of the shares represented may adjourn any such meeting from time to time without notice other than by announcement at such meeting, until the number of shares requisite to constitute a quorum shall be present. At any adjourned meeting at which a quorum, as above defined, shall be present, in person or by proxy, any business may be transacted which might have been transacted at the meeting as originally called. Once a share is represented for any purpose at a meeting, it is deemed present for quorum purposes for the remainder of the meeting and for any adjournment of that meeting unless a new record date is or must be set for that adjourned meeting. 2 SECTION 6. SHAREHOLDER VOTING. If a quorum is present, action on a matter is approved and shall be the act of the shareholders if the votes cast favoring the action exceed the votes cast against the action, except as otherwise provided in Section 6 of Article II or the Articles of Incorporation or as required by law. Except as otherwise provided in the Articles of Incorporation or as required by law, each outstanding share shall be entitled to one vote on each matter submitted to a vote at a meeting of shareholders. The books of record of shareholders shall be produced at a shareholders' meeting upon the request of any shareholder. SECTION 7. FIXING RECORD DATES. For the purpose of determining shareholders entitled (a) to notice of or to vote at any meeting of shareholders or any adjournment thereof, (b) to request a special meeting of shareholders pursuant to Section 2 of this Article I, (c) to receive payment of any dividend, or (d) to make a determination of shareholders for any other proper purpose, the Board of Directors shall have the power to fix a date, not more than 70 days (or such longer period as may be permitted by current or future law) prior to the date on which the particular action requiring a determination of shareholders is to be taken, as the record date for any such determination of shareholders. A record date for the determination of shareholders entitled to notice of or to vote at any meeting of shareholders or any adjournment thereof shall not be a date less than 10 days prior to such meeting. In setting a record date, whether in response to a request from a shareholder or otherwise, the Board of Directors may consider such factors as it deems relevant within the good faith exercise of its business judgment including, without limitation, the nature of the action proposed to be taken, the facts and circumstances surrounding the request, and any plan of the Board of Directors to call a special or annual meeting of shareholders for the conduct of related business. In any case where a record date is set under any provision of this Article I, only shareholders of record on the record date shall be entitled to participate in the action for which the determination of shareholders of record is made, and, if the record date is set for the determination of shareholders entitled to notice of or to vote at a meeting of shareholders, only such shareholders of record shall be entitled to such notice or vote, notwithstanding any transfer of any shares on the books of the corporation after such record date. SECTION 8. PROXIES. A shareholder entitled to vote at any meeting of shareholders or any adjournment thereof may vote in person or by proxy executed in writing and signed by the shareholder or his attorney-in-fact. The appointment of a proxy will be effective when received by the corporation's secretary or other officer or agent authorized to tabulate votes. If a proxy designates two or more persons to act as proxies, a majority of these persons present at the meeting, or if only one is present, that one, has all of the powers conferred by the instrument upon all the persons designated unless the instrument otherwise provides. No proxy shall be valid more than 11 months after the date of its execution unless a longer term is expressly stated in the proxy. SECTION 9. NOTIFICATION OF NOMINATION OF DIRECTORS. Nominations for election to the Board of Directors of the corporation at a meeting of shareholders may be made by the Board of Directors or by any shareholder of the corporation entitled to vote for the election of directors at such meeting who complies with the notice procedures set forth in this Section 9. Such nominations, other than those made by or on behalf of the Board of Directors, may be made only if notice in writing is personally delivered to, or mailed by 3 first class United States mail, postage prepaid, and received by, the secretary not less than 60 days nor more than 90 days prior to such meeting; PROVIDED, HOWEVER, that if less than 70 days' notice or prior public disclosure of the date of the meeting is given to shareholders, such nomination shall have been mailed by first class United States mail, postage prepaid, and received by, or personally delivered to, the secretary not later than the close of business on the tenth day following the day on which notice of the date of the meeting was mailed or such public disclosure was made, whichever occurs first. Such notice shall set forth (a) as to each proposed nominee (i) the name, age, business address and, if known, residence address of each such nominee, (ii) the principal occupation or employment of each such nominee, (iii) the number of shares, if any, of stock of the corporation that are beneficially owned by each such nominee and (iv) any other information concerning the nominee that must be disclosed in proxy solicitations pursuant to the proxy rules of the Securities and Exchange Commission if such person had been nominated, or was intended to be nominated, by the Board of Directors (including such person's written consent to be named as a nominee and to serve as a director if elected); and (b) as to the shareholder giving the notice (i) the name and address, as it appears on the corporation's books, of such shareholder, (ii) a representation that such shareholder is a holder of record of shares of stock of the corporation entitled to vote at the meeting and the class and number of shares of the corporation which are beneficially owned by such shareholder, (iii) a representation that such shareholder intends to appear in person or by proxy at the meeting to nominate the person or persons specified in the notice and (iv) a description of all arrangements or understandings between such shareholder and each nominee and any other person or persons (naming such person or persons) pursuant to which the nomination or nominations are to be made by such shareholder. The corporation also may require any proposed nominee to furnish such other information as may reasonably be required by the corporation to determine the eligibility of such proposed nominee to serve as a director of the corporation. The chairman of the meeting may, if the facts warrant, determine and declare to the meeting that a nomination was not made in accordance with the foregoing procedure, and if he should so determine, he shall so declare to the meeting, and that the defective nomination shall be disregarded. SECTION 10. NOTICE OF BUSINESS AT ANNUAL MEETINGS. At an annual meeting of the shareholders, only such business shall be conducted as shall have been properly brought before the meeting. To be properly brought before an annual meeting, business must be (a) specified in the notice of meeting (or any supplement thereto) given by or at the direction of the Board of Directors, (b) otherwise properly brought before the meeting by or at the direction of the Board of Directors or (c) otherwise properly brought before the meeting by a shareholder. For business to be properly brought before an annual meeting by a shareholder, if such business relates to the election of directors of the corporation, the shareholder must comply with Section 9 of this Article I. If such business relates to any other matter, the shareholder must have given timely notice thereof in writing to the secretary. To be timely, a shareholder's notice must be personally delivered to, or mailed by first class United States mail, postage prepaid, and received by, the secretary not less than 60 days not more than 90 days prior to such meeting; PROVIDED, HOWEVER, that if less than 70 4 days' notice or prior public disclosure of the date of the meeting is given to shareholders, such notice, to be timely, must have been mailed by first class United States mail, postage prepaid, and received by, or personally delivered to, the secretary not later than the close of business on the tenth day following the day on which notice of the date of the meeting was mailed or such public disclosure was made, whichever occurs first. A shareholder's notice to the secretary shall set forth as to each matter the shareholder proposes to bring before the annual meeting (i) a brief description of the business desired to be brought before the annual meeting and the reasons for conducting such business at the annual meeting, (ii) the name and address, as they appear on the corporation's books, of the shareholder proposing such business, (iii) a representation that the shareholder is a holder of record of shares of stock of the corporation entitled to vote at the meeting and the class and number of shares of the corporation which are beneficially owned by the shareholder and (iv) any material interest of the shareholder in such business. Notwithstanding anything in these Bylaws to the contrary, no business shall be conducted at any annual meeting except in accordance with the procedures set forth in this Section 10 and except that any shareholder proposal which complies with Rule 14a-8 of the proxy rules (or any successor provision) promulgated under the Securities Exchange Act of 1934, as amended, and is to be included in the corporation's proxy statement for an annual meeting of shareholders shall be deemed to comply with the requirements of this Section 10. The chairman of the meeting may, if the facts warrant, determine and declare to the meeting that business was not properly brought before the meeting in accordance with the provisions of this Section 10, and if he should so determine, he shall so declare to the meeting and the business not properly brought before the meeting shall be disregarded. ARTICLE II DIRECTORS SECTION 1. FUNCTION. All corporate powers shall be exercised by or under the authority of, and the business and affairs of the corporation shall be managed under the direction of, the Board of Directors. Directors must be natural persons who are at least 18 years of age but need not be residents of Florida or shareholders of the corporation. SECTION 2. COMPENSATION. The directors, as such, shall be entitled to receive such reasonable compensation for their services as may be fixed from time to time by resolution of the Board of Directors. In addition, the directors may be reimbursed for expenses of attending meetings of the Board of Directors and committees thereof and meetings of the shareholders. Nothing herein contained shall be construed to preclude any director from serving the corporation in any other capacity and receiving compensation therefor. Members of the executive committee or of any standing or special committee of the Board of Directors may by resolution of the Board of Directors be allowed such compensation for their services as the Board of Directors may deem reasonable, and additional compensation may be allowed to directors for special services rendered. 5 SECTION 3. PRESUMPTION OF ASSENT. A director who is present at a meeting of the Board of Directors or a committee of the Board of Directors at which action on any corporate matter is taken shall be presumed to have assented to the action taken unless he objects at the beginning of the meeting (or promptly upon arriving) to the holding of the meeting or transacting the specified business at the meeting, or if the director votes against the action taken or abstains from voting because of an asserted conflict of interest or otherwise. SECTION 4. NUMBER OF DIRECTORS. The Board of Directors of the corporation shall consist of a number of persons not less than two, the exact number to be determined from time to time by resolution adopted by the affirmative vote of a majority of all directors of the corporation then holding office at any special or regular meeting. Any resolution increasing or decreasing the number of directors shall have the effect of creating or eliminating a vacancy or vacancies, as the case may be, provided that no resolution shall reduce the number of directors below the number then holding office. SECTION 5. TERM OF OFFICE. Each director shall hold office until the annual meeting next succeeding his election and until his successor is elected and qualified, or until his earlier resignation, removal from office or death. SECTION 6. ELECTION OF DIRECTORS. Directors shall be elected at the annual meeting of shareholders, but when the annual meeting is not held or directors are not elected thereat, they may be elected at a special meeting called and held for that purpose. Directors shall be elected by a plurality of the votes cast by the shares entitled to vote in the election at a meeting at which a quorum is present. SECTION 7. VACANCIES. Any vacancy occurring in the Board of Directors, including a vacancy created by an increase in the number of directors, may be filled by the shareholders or by the affirmative vote of a majority of the remaining directors though less than a quorum of the Board of Directors. A director elected to fill a vacancy shall hold office only until the next election of directors by the shareholders. If there are no remaining directors, the vacancy shall be filled by the shareholders. SECTION 8. REMOVAL OF DIRECTORS. At a meeting of shareholders, any director or the entire Board of Directors may be removed, with or without cause, provided the notice of the meeting states that one of the purposes of the meeting is the removal of the director or directors. A director may be removed only if the number of votes cast for removal exceeds the number of votes cast against removal. SECTION 9. QUORUM AND TRANSACTION OF BUSINESS. A majority of the number of directors fixed pursuant to these Bylaws shall constitute a quorum for the transaction of business The act of a majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors. 6 SECTION 10. PLACE OF MEETING. Regular and special meetings of the Board of Directors shall be held at the principal office of the corporation or as determined by the Chairman of the Board, unless otherwise designated by resolution from time to time by the Board of Directors. SECTION 11. TIME, NOTICE AND CALL OF MEETINGS. Regular meetings of the Board of Directors shall be held without notice at the time and on the date designated by resolution of the Board of Directors. Meetings of the Board of Directors may be called by the Chairman of the Board, the chief executive officer or any two directors. Upon determining the need for a special meeting, the Chairman of the Board shall direct the secretary of the corporation to provide written notice of the time, date and place of such special meeting of the Board of Directors to each director by personal delivery, mail or courier delivery or by facsimile at least two but not more than 15 days before the meeting. Notice of a meeting of the Board of Directors need not be given to a director who signs a waiver of notice either before, at or after the meeting. Attendance of a director at a meeting constitutes a waiver of notice of that meeting and waiver of all objections to the place of the meeting, the time of the meeting, and the manner in which it has been called or convened, except when a director states at the beginning of the meeting or promptly upon arrival at the meeting, objection to the transaction of business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the Board of Directors must be specified in the notice or waiver of notice of the meeting. Notice of an adjourned meeting shall be given to the directors who were not present at the time of the adjournment and, unless the time and place of the adjourned meeting are announced at the time of the adjournment, to the other directors. Members of the Board of Directors (and any committee of the Board) may participate in a meeting of the Board of Directors (or committee) by means of a conference telephone or similar communications equipment pursuant to which all persons participating in the meeting can hear each other at the same time. Participation by these means constitutes presence in person at a meeting. SECTION 12. ACTION WITHOUT A MEETING. Any action required to be taken at a meeting of the Board of Directors (or a committee), and any action which may be taken at a meeting of the Board of Directors (or a committee) may be taken without a meeting if a consent in writing, setting forth the action to be taken and signed by all of the directors (or members of the committee), is filed in the minutes of the proceedings of the Board of Directors. The action taken shall be deemed effective when the last director signs the consent, unless the consent specifies otherwise. ARTICLE III COMMITTEES SECTION 1. EXECUTIVE COMMITTEE. The Board of Directors may from time to time, by resolution passed by a majority of the whole Board of Directors, create an executive committee of three or more directors, the members of which shall be elected by the Board of Directors to serve at the pleasure of the Board of Directors. If the Board of Directors does not designate a chairman of the executive committee, the executive committee shall elect a chairman from its own 7 members. Except as otherwise required by law, these bylaws, or in the resolution creating an executive committee, such committee shall, during the intervals between the meetings of the Board of Directors, possess and may exercise all of the powers of the Board of Directors in the management of the business and affairs of the corporation, other than that of filling vacancies among the directors or in any committee of the directors. The executive committee shall keep full records and accounts of its proceedings and transactions. All action by the executive committee shall be reported to the Board of Directors at its meeting next succeeding such action and shall be subject to control, revision and alteration by the Board of Directors, provided that no rights of third persons shall be prejudicially affected thereby. Vacancies in the executive committee shall be filled by the Board of Directors, and the Board of Directors may appoint one or more directors as alternate members of the executive committee who may take the place of any absent member or members at any meeting. SECTION 2. MEETINGS OF EXECUTIVE COMMITTEE. Subject to the provisions of these Bylaws, the executive committee shall fix its own rules of procedure and shall meet as provided by such rules or by resolutions of the Board of Directors, and it shall also meet at the call of the Chairman of the Board, the chairman of the executive committee or any two members of the committee. Unless otherwise provided by such rules or by such resolutions, the provisions of Section 11 of Article II relating to the notice required to be given for meetings of the Board of Directors shall also apply to meetings of the executive committee. A majority of the executive committee shall be necessary to constitute a quorum. SECTION 3. OTHER COMMITTEES. The Board of Directors may by resolution provide for such other standing or special committees as it deems desirable, and discontinue the same at its pleasure. Each such committee shall have such powers and perform such duties, not inconsistent with law, as may be delegated to it by the Board of Directors. The provisions of Section 1 and Section 2 of this Article III shall govern the appointment and action of such committee so far as consistent, unless otherwise provided by the Board of Directors. Vacancies in such committees shall be filled by the Board of Directors or as the Board of Directors may provide. ARTICLE IV OFFICERS SECTION 1. GENERAL PROVISIONS. The Board of Directors shall appoint a Chairman of the Board of Directors, a chief executive officer, a president, and a secretary. A person may hold more than one such office. The Board of Directors may from time to time create such offices and appoint such other officers, subordinate officers and assistant officers as it may determine. The Chairman of the Board, shall be, but the other officers need not be, chosen from among the members of the Board of Directors. Each officer shall hold office at the pleasure of the Board of Directors, and perform such duties as the Board of Directors may prescribe. The Board of Directors may, from time to time, authorize any officer to appoint and remove subordinate and assistant officers, to prescribe their authority and duties, and to fix their compensation. 8 SECTION 2. TERM OF OFFICE. The officers of the corporation shall hold office at the pleasure of the Board of Directors, and, unless sooner removed by the Board of Directors, until the annual meeting of the Board of Directors following the date of their appointment and until their successors are chosen and qualified. The Board of Directors may remove any officer at any time, with or without cause. A vacancy in any office established by these Bylaws or created by the Board of Directors shall be filled by the Board of Directors. SECTION 3. CHAIRMAN OF THE BOARD. The Chairman of the Board shall preside at all meetings of the Board of Directors and meetings of shareholders. SECTION 4. CHIEF EXECUTIVE OFFICER. The chief executive officer shall exercise supervision over the management of the business of the corporation and its several officers, subject, however, to the oversight of the Board of Directors. In the absence of the Chairman of the Board, he shall preside at meetings of the shareholders. SECTION 5. PRESIDENT. The president shall exercise supervision over the management of the business of the corporation and its several officers, subject, however, to the oversight of the Board of Directors and the chief executive officer. In the absence of the Chairman of the Board and chief executive officer, he shall preside at meetings of the shareholders. SECTION 6. SECRETARY. The secretary shall keep minutes of all the proceedings of the shareholders and the Board of Directors and shall make proper records of the same, which shall be attested by him; shall have authority to execute and deliver certificates as to any of such proceedings and any other records of the corporation; shall give notice of meetings of shareholders and directors; shall produce on request at each meeting of shareholders a certified list of shareholders arranged in alphabetical order; shall keep such books and records as may be required by law or by the Board of Directors; and, in general, shall perform all duties incident to the office of secretary and such other duties as may from time to time be assigned to him by the Board of Directors or the president. SECTION 7. DUTIES OF OFFICERS MAY BE DELEGATED. In the absence of any officer of the corporation, or for any other reason the Board of Directors may deem sufficient, the Board of Directors may delegate, for such period of time as the Board of Directors deem appropriate, the powers or duties, or any of them, of any officer to any other officer or to any director. SECTION 8. REMOVAL OF CERTAIN OFFICERS. Neither the Chairman, the chief executive officer nor the president may be removed from office unless such removal shall have first been approved by a majority of the whole Board of Directors. 9 ARTICLE V SHARE CERTIFICATE AND SEAL SECTION 1. FORM AND EXECUTION. Certificates for shares, certifying the number of fully-paid shares owned, shall be issued to each shareholder in such form as shall be approved by the Board of Directors. Such certificates shall be signed by the Chairman of the Board, the chief executive officer or the president and by the secretary; provided, however, that if such certificates are countersigned by a transfer agent and/or registrar the signatures of any of said officers and the seal of the corporation upon such certificates may be facsimiles, engraved, stamped or printed. If any officer or officers who shall have signed, or whose facsimile signature shall have been used, printed or stamped on any certificate or certificates for shares, shall cease to be such officer or officers, because of death, resignation or otherwise, before such certificate or certificates shall have been delivered by the corporation, such certificate or certificates, if authenticated by the endorsement thereon of the signature of a transfer agent or registrar, shall nevertheless be conclusively deemed to have been adopted by the corporation by the use and delivery thereof and shall be as effective in all respects as though signed by a duly elected, qualified and authorized officer or officers, and as though the person or persons who signed such certificate or certificates, or whose facsimile signature or signatures shall have been used thereon, had not ceased to be an officer or officers of the corporation. The failure of the corporation to note upon a certificate a restriction on the transfer of shares imposed or which may be imposed by law, contract or otherwise, shall not be deemed to imply that such shares are free of any such restriction or create in favor of the person to whom such certificate is issued, or any successor, assign, devise or heir of such recipient, any cause of action of any nature against the corporation. SECTION 2. REGISTRATION OF TRANSFER. Any certificate for shares of the corporation shall be transferable (subject to any applicable restrictions imposed or which may be imposed by law, contract or otherwise) in person or by attorney upon the surrender thereof to the corporation or any transfer agent therefor (for the class of shares represented by the certificate surrendered) properly endorsed for transfer and accompanied by such assurances as the corporation or such transfer agent may require as to the genuineness and effectiveness of each necessary endorsement. SECTION 3. LOST, STOLEN OR DESTROYED CERTIFICATES. The corporation shall, upon the authorization of the Chairman of the Board, the chief executive officer, the president, the secretary or such other person as is authorized by resolution of the Board of Directors, issue a new stock certificate in the place of any certificate previously issued if the holder of record of the certificate (a) makes proof in affidavit form that it has been lost, destroyed or wrongfully taken; (b) requests the issue of a new certificate before the corporation has notice that the certificate has been acquired by a purchaser for value in good faith and without notice of any adverse claim; (c) gives bond in such form as the corporation may direct to indemnify the corporation and any transfer agent and registrar against any claim that may be made on account of the alleged loss, destruction, or theft of a certificate; and (d) satisfies any other reasonable requirements imposed by the corporation. SECTION 4. SEAL. The corporate seal shall be circular in form and include the name of the corporation. 10 ARTICLE VI DISTRIBUTIONS The Board of Directors may, from time to time, declare distributions to its shareholders in cash, property, or its own shares, unless the distribution would cause (i) the corporation to be unable to pay its debts as they become due in the usual course of business, or (ii) the corporation's assets to be less than its liabilities plus the amount necessary, if the corporation were dissolved at the time of the distribution, to satisfy the preferential rights of shareholders whose rights are superior to those receiving the distribution. The shareholders and the corporation may enter into an agreement requiring the distribution of corporate profits, subject to the provisions of applicable law. ARTICLE VII MISCELLANEOUS PROVISIONS SECTION 1. FISCAL YEAR. The fiscal year of the corporation shall be the calendar year. SECTION 2. RESIGNATION. Any director or officer of the corporation may resign his office at any time upon presenting his written resignation to the Board of Directors, the Chairman of the Board, the chief executive officer, the president or the secretary, and, unless some time be fixed in such resignation as the date upon which it is to become effective, the same shall become effective immediately upon presentation. The acceptance of a resignation shall not be required to make it effective, unless otherwise so stated in such resignation, and in that event it shall become effective at the pleasure of the Board of Directors. SECTION 3. VOTING UPON STOCKS OF OTHER CORPORATIONS. Unless otherwise ordered by the Board of Directors, the Chairman of the Board, the chief executive officer, or the president shall, in the order above stated, have full power and authority on behalf of the corporation to attend, act and vote at any meeting or meetings of shareholders of any corporation in which the corporation may hold stock or other securities, and at any such meeting shall possess and may exercise on behalf of the corporation any and all of the rights and powers incident to the ownership of such stock or other securities. The person having the power and authority as set forth above may in his discretion delegate the same to another person that he designates to act on behalf of the corporation at any given meeting. The Board of Directors, by resolution, may from time to time confer like powers upon any other person or persons. ARTICLE VIII CORPORATE RECORDS, SHAREHOLDERS' INSPECTION RIGHTS; FINANCIAL INFORMATION SECTION 1. CORPORATE RECORDS. 11 (a) The corporation shall keep as permanent records minutes of all meetings of its shareholders and the Board of Directors, a record of all actions taken by the shareholders or Board of Directors without a meeting, and a record of all actions taken by a committee of the Board of Directors. (b) The corporation shall maintain a record of its shareholders in a form that permits preparation of a list of the names and addresses of all shareholders in alphabetical order by class of shares showing the number and series of shares held by each. (c) The corporation shall keep a copy of: (i) its articles or restated articles of incorporation and all amendments to them currently in effect; (ii) these Bylaws or restated Bylaws and all amendments currently in effect; (iii) resolutions adopted by the Board of Directors creating one or more classes or series of shares and fixing their relative rights, preferences, and limitations, if shares issued pursuant to those resolutions are outstanding; (iv) the minutes of all shareholders' meetings and records of all actions taken by shareholders without a meeting for the past three years; (v) written communications to all shareholders generally or all shareholders of a class of series within the past three years, including the financial statements furnished for the last three years; (vi) a list of names and business street addresses of its current directors and officers; and (vii) its most recent annual report delivered to the Department of State. (d) The corporation shall maintain its records in written form or in another form capable of conversion into written form within a reasonable time. SECTION 2. SHAREHOLDERS' INSPECTION RIGHTS. A shareholder is entitled to inspect and copy, during regular business hours at the corporation's principal office, any of the corporate records described in Section 1(c) of this Article if the shareholder gives the corporation written notice of the demand at least 5 business days before the date on which he wishes to inspect and copy the records. A shareholder is entitled to inspect and copy, during regular business hours at a reasonable location specified by the corporation, any of the following records of the corporation if the shareholder gives the corporation written notice of this demand at least 5 business days before the date on which he wishes to inspect and copy provided (a) the demand is made in good faith and for a proper purpose; (b) the shareholder describes with reasonable particularity the purpose and the records he desires to inspect; and (c) the records are directly connected with the purpose: (i) excerpts from minutes of any meeting of the Board of Directors, records of any action of a committee of the Board of Directors while acting in place of the Board of Directors on behalf of the corporation; (ii) accounting records; (iii) the record of shareholders; and (iv) any other books and records of the corporation. This Section 2 does not affect the right of a shareholder to inspect and copy the shareholders' list described in Section 6 of Article I or, if the shareholder is in litigation with the corporation, to the same extent as any other litigant or the power of a court to compel the production of corporate records for examination. 12 The corporation may deny any demand for inspection if the demand was made for an improper purpose, or if the demanding shareholder has within the two years preceding his demand, sold or offered for sale any list of shareholders of the corporation or of any other corporation, has aided or abetted any person in procuring any list of shareholders for that purpose, or has improperly used any information secured through any prior examination of the records of the corporation or any other corporation. SECTION 3. FINANCIAL STATEMENTS FOR SHAREHOLDERS. Unless modified by resolution of the shareholders within 120 days after the close of each fiscal year, the corporation shall furnish its shareholders with annual financial statements which may be consolidated or combined statements of the corporation and one or more of its subsidiaries, as appropriate, that include a balance sheet as of the end of the fiscal year, an income statement for that year, and a statement of cash flows for that year. If financial statements are prepared for the corporation on the basis of generally accepted accounting principles, the annual financial statements must also be prepared on that basis. If the annual financial statements are reported upon by a public accountant, his report must accompany them. If not, the statements must be accompanied by a statement of the chief financial officer or the person responsible for the corporation's accounting records stating his reasonable belief whether the statements were prepared on the basis of generally accepted accounting principles and, if not, describing the basis of preparation and describing any respects in which the statements were not prepared on a basis of accounting consistent with the statements prepared for the preceding year. The corporation shall mail the annual financial statements to each shareholder within 120 days after the close of each fiscal year or within such additional time thereafter as is reasonably necessary to enable the corporation to prepare its financial statements. Thereafter, on written request from a shareholder who was not mailed the statements, the corporation shall mail him the latest annual financial statements. SECTION 4. OTHER REPORTS TO SHAREHOLDERS. If the corporation indemnifies or advances expenses to any director, officer, employee or agent otherwise than by court order or action by the shareholders or by an insurance carrier pursuant to insurance maintained by the corporation, the corporation shall report the indemnification or advance in writing to the shareholders with or before the notice of the next annual shareholders' meeting, or prior to the meeting if the indemnification or advance occurs after the giving of the notice but prior to the time the annual meeting is held. This report shall include a statement specifying the persons paid, the amounts paid, and the nature and status at the time of such payment of the litigation or threatened litigation. If the corporation issues or authorizes the issuance of shares for promises to render services in the future, the corporation shall report in writing to the shareholders the number of shares authorized or issued, and the consideration received by the corporation, with or before the notice of the next shareholders' meeting. 13 ARTICLE IX INDEMNIFICATION SECTION 1. RIGHT TO INDEMNIFICATION. Each person (including here and hereinafter, the heirs, executors, administrators, or estate of such person) (i) who is or was a director or officer of the corporation, (ii) who is or was an agent or employee of the corporation other than an officer and as to whom the corporation has agreed to grant such indemnity, or (iii) who is or was serving at the request of the corporation as its representative in the position of director, officer, agent or employee of another corporation, partnership, joint venture, trust or other enterprise and as to whom the corporation has agreed to grant such indemnity shall be indemnified by the corporation as of right to the fullest extent permitted or authorized by current or future legislation or by current or future judicial or administrative decision (but, in the case of any such future legislation or decision, only to the extent that it permits the corporation to provide broader indemnification rights than permitted prior to such legislation or decision), against any liability or expense, awarded or assessed against him, or incurred by him, in his capacity as such director, officer, agent, employee or representative, or arising out of his status as such director, officer, agent, employee, or representative, including (in the case of derivative actions) expenses and amounts paid by him in settlement of any proceeding asserted or brought against him in his aforesaid capacity or arising out of his status as such. SECTION 2. ADVANCEMENT OF EXPENSES. Expenses incurred by a person referred to in Section 1 of this Article IX in defending a proceeding shall be paid by the corporation in advance of the final disposition of such proceeding, (i) upon receipt, in the case of a director or officer, of an undertaking by or on behalf of the director or officer to repay all amounts so advanced if he is ultimately found not to be entitled to be indemnified by the corporation pursuant to this Article IX, and (ii) upon satisfaction of such other conditions as are required by current or future legislation (but, with respect to future legislation, only to the extent that it provides conditions less burdensome to the director, officer, employee, agent or representative, and to the corporation, than those provided previously). Such expenses incurred by other employees, agents and representatives may be so paid upon such terms and conditions, if any, as the Board of Directors deems appropriate. The Board of Directors may, in the manner set forth above, and upon approval of such director, officer, employee, agent or representative of the corporation, authorize the corporation's counsel to represent such person, in any proceeding, whether or not the corporation is a party to such proceeding. SECTION 3. PROCEDURE FOR INDEMNIFICATION AND OBTAINING ADVANCEMENT OF EXPENSES. Any indemnification of liabilities and expenses or advancement of expenses under this Article IX shall be made promptly, and in any event within 60 days, upon the written request of the director, officer, employee, agent or representative seeking indemnification or an advancement. If the corporation denies such request in whole or in part or if no disposition thereof is made within 60 days of its receipt of such request or if the corporation otherwise fails to provide indemnification or advancement provided for in this Article IX, and despite any contrary determination by the corporation (including its Board of Directors or a committee thereof, its independent legal counsel or its shareholders) in the specific case, a director, officer, employee, agent or representative may apply for indemnification or advancement, or both, in an 14 appropriate proceeding brought in a court of competent jurisdiction and shall be entitled to such indemnification or advancement, or both, as the court shall by order direct. Such person's reasonable expenses in obtaining court-ordered indemnification or advancement shall be reimbursed by the corporation. No such contrary determination by the corporation (including the Board of Directors or a committee thereof, its independent legal counsel or its shareholders) shall be a defense to such proceeding or create a presumption that the claimant has not met the applicable standard of conduct, if any, for indemnification or an advancement. SECTION 4. OTHER RIGHTS, CONTINUATION OF RIGHT TO INDEMNIFICATION AND ADVANCEMENTS. The indemnification and advancements provided by this Article IX shall not be deemed exclusive of any other or further rights to which a person seeking indemnification or advancements may be entitled under any law (common or statutory), agreement, vote of shareholders or disinterested directors or otherwise, either as to action taken or omitted to be taken in his official capacity or as to action taken or omitted to be taken in another capacity while holding office or while employed by or acting as agent for the corporation. All rights to indemnification and to advancements of expenses under this Article IX shall be deemed to be a contract between the corporation and each director, officer, employee, agent or representative of the corporation described in Section 1 of this Article IX who serves or has served in any such capacity at any time while this Article IX is in effect. Any repeal or modification of this Article IX, or any repeal or modification of relevant provisions of the Florida Business Corporation Act or any other applicable law, shall not in any way diminish any right to indemnification or to advancement of expenses of such director, officer, employee, agent or representative, or the obligations of the corporation, arising hereunder prior to such repeal or modification. SECTION 5. INSURANCE. The corporation may purchase and maintain insurance, at its expense, to protect itself and any person who is or was or has agreed to become a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against him and incurred by him or on his behalf in any such capacity, or arising out of his status as such, whether or not the corporation would have the legal power to directly indemnify him against such liability. SECTION 6. SAVINGS CLAUSE. If this Article IX or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the corporation shall nevertheless indemnify each director and officer, and each employee, agent and representative of the corporation described in Section 1 of this Article IX, as to liabilities and expenses, and amounts paid in settlement with respect to any proceeding, including any action by or in the right of the corporation, to the full extent permitted by any applicable portion of this Article IX that shall not have been invalidated and to the full extent permitted by applicable law. 15 SECTION 7. TERMS. For purposes of this Article IX, the term "other enterprises" includes employee benefit plans; the term "expenses" includes counsel fees, including those for appeal; the term "liability" includes obligations to pay a judgment, settlement, penalty, fine (including an excise tax assessed with respect to any employee benefit plan), and expenses actually and reasonably incurred with respect to a proceeding; the term "proceeding" includes any threatened, pending, or completed action, suit, or other type of proceeding, whether civil, criminal, administrative, or investigative and whether formal or informal; the term "agent" includes a volunteer; and the term "serving at the request of the corporation" includes any service as a director, officer, employee or agent of the corporation that imposes duties on such persons, including duties relating to an employee benefit plan and its participants or beneficiaries. 16 ARTICLE X AMENDMENT These Bylaws may be altered, amended or repealed, and new Bylaws adopted, by the Board of Directors or shareholders. 17 EX-99.1 4 g77546exv99w1.txt CERTIFICATE OF CHAIRMAN & CEO EXHIBIT 99.1 I, Phillip Frost, M.D., Chairman and Chief Executive Officer of IVAX Corporation, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that: (1) the Quarterly Report of IVAX Corporation on Form 10-Q for the quarterly period ended June 30, 2002 (the "Periodic Report"), which this statement accompanies, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of IVAX Corporation. /s/ Phillip Frost, M.D. ----------------------------------------- Phillip Frost, M.D. Chairman and Chief Executive Officer August 13, 2002 EX-99.2 5 g77546exv99w2.txt CERTIFICATE OF CHIEF FINANCIAL OFFICER EXHIBIT 99.2 I, Thomas E. Beier, Senior Vice President - Finance and Chief Financial Officer of IVAX Corporation, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that: (3) the Quarterly Report of IVAX Corporation on Form 10-Q for the quarterly period ended June 30, 2002 (the "Periodic Report"), which this statement accompanies, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (4) information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of IVAX Corporation. /s/ Thomas E. Beier ---------------------------------------- Thomas E. Beier Senior Vice President - Finance and Chief Financial Officer August 13, 2002 -----END PRIVACY-ENHANCED MESSAGE-----

EX-3.2

                                                                     EXHIBIT 3.2









                                     BYLAWS

                                       OF

                                IVAX CORPORATION
                              a Florida corporation







                                TABLE OF CONTENTS



                                                                                                             Page
                                                                                                             ----

                                                                                                          
ARTICLE I -- Meetings of Shareholders.........................................................................1

         Section 1. Annual Meeting............................................................................1
         Section 2. Special Meeting...........................................................................1
         Section 3. Place.....................................................................................2
         Section 4. Notice....................................................................................2
         Section 5. Shareholder Quorum........................................................................2
         Section 6. Shareholder Voting........................................................................3
         Section 7. Fixing Record Dates.......................................................................3
         Section 8. Proxies...................................................................................3
         Section 9. Notification of Nomination of Directors...................................................3
         Section 10. Notice of Business at Annual Meetings....................................................4

ARTICLE II -- Directors.......................................................................................5

         Section 1. Function..................................................................................5
         Section 2. Compensation..............................................................................5
         Section 3. Presumption of Assent.....................................................................6
         Section 4. Number of Directors.......................................................................6
         Section 5. Term of Office............................................................................6
         Section 6. Election of Directors.....................................................................6
         Section 7. Vacancies.................................................................................6
         Section 8. Removal of Directors......................................................................6
         Section 9. Quorum and Transaction of Business........................................................6
         Section 10. Place of Meeting.........................................................................7
         Section 11. Time, Notice and Call of Meetings........................................................7
         Section 12. Action Without a Meeting.................................................................7

ARTICLE III -- Committees.....................................................................................7

         Section 1. Executive Committee.......................................................................7
         Section 2. Meetings of Executive Committee...........................................................8
         Section 3. Other Committees..........................................................................8

ARTICLE IV -- Officers........................................................................................8

         Section 1. General Provisions........................................................................8
         Section 2. Term of Office............................................................................9
         Section 3. Chairman of the Board.....................................................................9
         Section 4. Chief Executive Officer...................................................................9
         Section 5. President.................................................................................9



                                       i





                                                                                                          
         Section 6. Secretary.................................................................................9
         Section 7. Duties of Officers May be Delegated.......................................................9
         Section 8. Removal of Certain Officers...............................................................9

ARTICLE V -- Share Certificate and Seal.......................................................................10

         Section 1. Form and Execution........................................................................10
         Section 2. Registration of Transfer..................................................................10
         Section 3.  Lost, Stolen or Destroyed Certificates...................................................10
         Section 4. Seal......................................................................................10

ARTICLE VI -- Distributions...................................................................................11

ARTICLE VII -- Miscellaneous Provisions.......................................................................11

         Section 1. Fiscal Year...............................................................................11
         Section 2. Resignation...............................................................................11
         Section 3. Voting Upon Stocks of Other Corporations..................................................11

ARTICLE VIII -- Corporate Records, Shareholders' Inspection Rights; Financial Information.....................11

         Section 1. Corporate Records.........................................................................11
         Section 2. Shareholders' Inspection Rights...........................................................12
         Section 3. Financial Statements for Shareholders.....................................................13
         Section 4. Other Reports to Shareholders.............................................................13

ARTICLE IX -- Indemnification.................................................................................14

         Section 1. Right to Indemnification..................................................................14
         Section 2. Advancement of Expenses...................................................................14
         Section 3. Procedure for Indemnification and Obtaining Advancement of Expenses.......................14
         Section 4. Other Rights, Continuation of Right to Indemnification and Advancements...................15
         Section 5. Insurance.................................................................................15
         Section 6. Savings Clause............................................................................15
         Section 7. Terms.....................................................................................16

ARTICLE X -- Amendment........................................................................................17



                                       ii







                                IVAX CORPORATION

                                     BYLAWS


                                    ARTICLE I
                            MEETINGS OF SHAREHOLDERS

         SECTION 1. ANNUAL MEETING. The annual meeting of shareholders for the
election of directors and for the transaction of such other business as may
properly come before the meeting shall be held on the date, time and place
designated by the Board of Directors.

         SECTION 2. SPECIAL MEETING.

         (a) Special meetings of the shareholders shall be held when directed by
the Chairman of the Board or the Board of Directors or when requested in writing
by shareholders holding at least 50% of the corporation's stock having the right
and entitled to vote at such meeting. The call for the meeting shall be issued
by the secretary, unless the Chairman of the Board, the Board of Directors or
the shareholders requesting the calling of the meeting designate another person
to do so. Only business within the purposes described in the notice required in
Section 4 of this Article I may be conducted at a special shareholders' meeting.

         (b) Any shareholder of record seeking to have the shareholders request
a special meeting may, by written notice to the secretary, request the Board of
Directors to fix a record date pursuant to Section 7 of this Article I. The
Board of Directors shall promptly, but in all events within 10 business days
after the date upon which such a request is received, adopt resolutions fixing
the record date. In the event of the delivery, in the manner provided by Section
7 of this Article I, to the corporation of such a request or requests and/or any
related revocation or revocations, the corporation shall engage nationally
recognized independent inspectors of elections for the purpose of promptly
performing a ministerial review of the validity of the requests and revocations.
Every written request for a special meeting shall set forth the purpose or
purposes for which the special meeting is requested, the name and address, as
they appear in the corporation's books, of each shareholder making the request,
the class and number of shares of the corporation which are owned of record by
each such shareholder, and shall bear the date of signature of each such
shareholder. No such request shall be effective to request such a meeting
unless, within 60 days of any record date established in accordance with Section
7 of this Article I, a written request signed by a sufficient number of record
holders as of such date to request a special meeting in accordance with Section
2(a) of this Article I and, if applicable, the Articles of Incorporation are
delivered to the corporation in the manner prescribed in this Article I. For the
purposes of permitting a prompt ministerial review by the independent





inspectors, no request by shareholders for a special meeting shall be effective
until such date as the independent inspectors certify to the corporation that
the requests delivered to the corporation in accordance with this Article I
represent at least the minimum number of shares that would be necessary to
request such meeting. Within 10 business days after the independent inspectors
deliver such a certified report to the corporation, the Board of Directors shall
adopt a resolution calling a special meeting of the shareholders and fixing a
record date for such meeting in accordance with Section 7 of this Article I. In
setting a meeting date, the Board of Directors may consider such factors as it
deems relevant within the good faith exercise of its business judgment
including, without limitation, the nature of the action proposed to be taken,
the facts and circumstances surrounding the request, and any plan of the Board
of Directors to call a special or annual meeting of shareholders for the conduct
of related business. Nothing contained in this section shall in any way be
construed to suggest or imply that the Board of Directors or any shareholder
shall not be entitled to contest the validity of any request or revocation
thereof, or to take any other action including, without limitation, the
commencement, prosecution or defense of any litigation with respect thereto.

         SECTION 3. PLACE. Meetings of the shareholders shall be held at the
principal office of the corporation or as determined by the Chairman of the
Board, unless otherwise designated by resolution from time to time by the Board
of Directors.

         SECTION 4. NOTICE. A written notice of each meeting of shareholders,
signed by the secretary, president or the person authorized to call the meeting,
shall be mailed to each shareholder having the right and entitled to vote at the
meeting at the address as it appears on the records of the corporation, not less
than 10 nor more than 60 days before the date set for the meeting. The notice
shall state the time and place the meeting is to be held. A notice of a special
meeting shall also state the purposes of the meeting. A notice of meeting shall
be sufficient for that meeting and any adjournment of it. If a shareholder
transfers any shares after the notice is sent, it shall not be necessary to
notify the transferee. All shareholders may waive notice of a meeting before, at
or after the meeting.

         SECTION 5. SHAREHOLDER QUORUM. Except as otherwise required by law, or
by the Articles of Incorporation, a majority of the shares entitled to vote,
represented in person or by proxy, shall constitute a quorum at a meeting of
shareholders. Any number of shareholders, even if less than a quorum, may
adjourn the meeting from time to time and place to place without further notice
until a quorum is obtained. When a specified item of business is required to be
voted on separately by a particular class or series of stock, the presence of a
majority of the shares of such class or series shall constitute a quorum for the
transaction of such item of business by that class or series, except as
otherwise required by law, by the Articles of Incorporation or by the terms of
the particular class or series of shares. If less than a quorum of shares
entitled to vote on a matter, as above defined, shall be present at the time and
place for which a meeting shall be called, the Chairman of the Board, or
secretary or the holders of a majority of the shares represented may adjourn any
such meeting from time to time without notice other than by announcement at such
meeting, until the number of shares requisite to constitute a quorum shall be
present. At any adjourned meeting at which a quorum, as above defined, shall be
present, in person or by proxy, any business may be transacted which might have
been transacted at the meeting as originally called. Once a share is represented
for any purpose at a meeting, it is deemed present for quorum purposes for the
remainder of the meeting and for any adjournment of that meeting unless a new
record date is or must be set for that adjourned meeting.



                                       2


         SECTION 6. SHAREHOLDER VOTING. If a quorum is present, action on a
matter is approved and shall be the act of the shareholders if the votes cast
favoring the action exceed the votes cast against the action, except as
otherwise provided in Section 6 of Article II or the Articles of Incorporation
or as required by law. Except as otherwise provided in the Articles of
Incorporation or as required by law, each outstanding share shall be entitled to
one vote on each matter submitted to a vote at a meeting of shareholders. The
books of record of shareholders shall be produced at a shareholders' meeting
upon the request of any shareholder.

         SECTION 7. FIXING RECORD DATES. For the purpose of determining
shareholders entitled (a) to notice of or to vote at any meeting of shareholders
or any adjournment thereof, (b) to request a special meeting of shareholders
pursuant to Section 2 of this Article I, (c) to receive payment of any dividend,
or (d) to make a determination of shareholders for any other proper purpose, the
Board of Directors shall have the power to fix a date, not more than 70 days (or
such longer period as may be permitted by current or future law) prior to the
date on which the particular action requiring a determination of shareholders is
to be taken, as the record date for any such determination of shareholders. A
record date for the determination of shareholders entitled to notice of or to
vote at any meeting of shareholders or any adjournment thereof shall not be a
date less than 10 days prior to such meeting. In setting a record date, whether
in response to a request from a shareholder or otherwise, the Board of Directors
may consider such factors as it deems relevant within the good faith exercise of
its business judgment including, without limitation, the nature of the action
proposed to be taken, the facts and circumstances surrounding the request, and
any plan of the Board of Directors to call a special or annual meeting of
shareholders for the conduct of related business. In any case where a record
date is set under any provision of this Article I, only shareholders of record
on the record date shall be entitled to participate in the action for which the
determination of shareholders of record is made, and, if the record date is set
for the determination of shareholders entitled to notice of or to vote at a
meeting of shareholders, only such shareholders of record shall be entitled to
such notice or vote, notwithstanding any transfer of any shares on the books of
the corporation after such record date.

         SECTION 8. PROXIES. A shareholder entitled to vote at any meeting of
shareholders or any adjournment thereof may vote in person or by proxy executed
in writing and signed by the shareholder or his attorney-in-fact. The
appointment of a proxy will be effective when received by the corporation's
secretary or other officer or agent authorized to tabulate votes. If a proxy
designates two or more persons to act as proxies, a majority of these persons
present at the meeting, or if only one is present, that one, has all of the
powers conferred by the instrument upon all the persons designated unless the
instrument otherwise provides. No proxy shall be valid more than 11 months after
the date of its execution unless a longer term is expressly stated in the proxy.

         SECTION 9. NOTIFICATION OF NOMINATION OF DIRECTORS. Nominations for
election to the Board of Directors of the corporation at a meeting of
shareholders may be made by the Board of Directors or by any shareholder of the
corporation entitled to vote for the election of directors at such meeting who
complies with the notice procedures set forth in this Section 9. Such
nominations, other than those made by or on behalf of the Board of Directors,
may be made only if notice in writing is personally delivered to, or mailed by




                                       3


first class United States mail, postage prepaid, and received by, the secretary
not less than 60 days nor more than 90 days prior to such meeting; PROVIDED,
HOWEVER, that if less than 70 days' notice or prior public disclosure of the
date of the meeting is given to shareholders, such nomination shall have been
mailed by first class United States mail, postage prepaid, and received by, or
personally delivered to, the secretary not later than the close of business on
the tenth day following the day on which notice of the date of the meeting was
mailed or such public disclosure was made, whichever occurs first. Such notice
shall set forth (a) as to each proposed nominee (i) the name, age, business
address and, if known, residence address of each such nominee, (ii) the
principal occupation or employment of each such nominee, (iii) the number of
shares, if any, of stock of the corporation that are beneficially owned by each
such nominee and (iv) any other information concerning the nominee that must be
disclosed in proxy solicitations pursuant to the proxy rules of the Securities
and Exchange Commission if such person had been nominated, or was intended to be
nominated, by the Board of Directors (including such person's written consent to
be named as a nominee and to serve as a director if elected); and (b) as to the
shareholder giving the notice (i) the name and address, as it appears on the
corporation's books, of such shareholder, (ii) a representation that such
shareholder is a holder of record of shares of stock of the corporation entitled
to vote at the meeting and the class and number of shares of the corporation
which are beneficially owned by such shareholder, (iii) a representation that
such shareholder intends to appear in person or by proxy at the meeting to
nominate the person or persons specified in the notice and (iv) a description of
all arrangements or understandings between such shareholder and each nominee and
any other person or persons (naming such person or persons) pursuant to which
the nomination or nominations are to be made by such shareholder. The
corporation also may require any proposed nominee to furnish such other
information as may reasonably be required by the corporation to determine the
eligibility of such proposed nominee to serve as a director of the corporation.

         The chairman of the meeting may, if the facts warrant, determine and
declare to the meeting that a nomination was not made in accordance with the
foregoing procedure, and if he should so determine, he shall so declare to the
meeting, and that the defective nomination shall be disregarded.

         SECTION 10. NOTICE OF BUSINESS AT ANNUAL MEETINGS. At an annual meeting
of the shareholders, only such business shall be conducted as shall have been
properly brought before the meeting. To be properly brought before an annual
meeting, business must be (a) specified in the notice of meeting (or any
supplement thereto) given by or at the direction of the Board of Directors, (b)
otherwise properly brought before the meeting by or at the direction of the
Board of Directors or (c) otherwise properly brought before the meeting by a
shareholder. For business to be properly brought before an annual meeting by a
shareholder, if such business relates to the election of directors of the
corporation, the shareholder must comply with Section 9 of this Article I. If
such business relates to any other matter, the shareholder must have given
timely notice thereof in writing to the secretary. To be timely, a shareholder's
notice must be personally delivered to, or mailed by first class United States
mail, postage prepaid, and received by, the secretary not less than 60 days not
more than 90 days prior to such meeting; PROVIDED, HOWEVER, that if less than 70



                                       4


days' notice or prior public disclosure of the date of the meeting is given to
shareholders, such notice, to be timely, must have been mailed by first class
United States mail, postage prepaid, and received by, or personally delivered
to, the secretary not later than the close of business on the tenth day
following the day on which notice of the date of the meeting was mailed or such
public disclosure was made, whichever occurs first. A shareholder's notice to
the secretary shall set forth as to each matter the shareholder proposes to
bring before the annual meeting (i) a brief description of the business desired
to be brought before the annual meeting and the reasons for conducting such
business at the annual meeting, (ii) the name and address, as they appear on the
corporation's books, of the shareholder proposing such business, (iii) a
representation that the shareholder is a holder of record of shares of stock of
the corporation entitled to vote at the meeting and the class and number of
shares of the corporation which are beneficially owned by the shareholder and
(iv) any material interest of the shareholder in such business. Notwithstanding
anything in these Bylaws to the contrary, no business shall be conducted at any
annual meeting except in accordance with the procedures set forth in this
Section 10 and except that any shareholder proposal which complies with Rule
14a-8 of the proxy rules (or any successor provision) promulgated under the
Securities Exchange Act of 1934, as amended, and is to be included in the
corporation's proxy statement for an annual meeting of shareholders shall be
deemed to comply with the requirements of this Section 10.

         The chairman of the meeting may, if the facts warrant, determine and
declare to the meeting that business was not properly brought before the meeting
in accordance with the provisions of this Section 10, and if he should so
determine, he shall so declare to the meeting and the business not properly
brought before the meeting shall be disregarded.


                                   ARTICLE II
                                    DIRECTORS

         SECTION 1. FUNCTION. All corporate powers shall be exercised by or
under the authority of, and the business and affairs of the corporation shall be
managed under the direction of, the Board of Directors. Directors must be
natural persons who are at least 18 years of age but need not be residents of
Florida or shareholders of the corporation.

         SECTION 2. COMPENSATION. The directors, as such, shall be entitled to
receive such reasonable compensation for their services as may be fixed from
time to time by resolution of the Board of Directors. In addition, the directors
may be reimbursed for expenses of attending meetings of the Board of Directors
and committees thereof and meetings of the shareholders. Nothing herein
contained shall be construed to preclude any director from serving the
corporation in any other capacity and receiving compensation therefor. Members
of the executive committee or of any standing or special committee of the Board
of Directors may by resolution of the Board of Directors be allowed such
compensation for their services as the Board of Directors may deem reasonable,
and additional compensation may be allowed to directors for special services
rendered.



                                       5


         SECTION 3. PRESUMPTION OF ASSENT. A director who is present at a
meeting of the Board of Directors or a committee of the Board of Directors at
which action on any corporate matter is taken shall be presumed to have assented
to the action taken unless he objects at the beginning of the meeting (or
promptly upon arriving) to the holding of the meeting or transacting the
specified business at the meeting, or if the director votes against the action
taken or abstains from voting because of an asserted conflict of interest or
otherwise.

         SECTION 4. NUMBER OF DIRECTORS. The Board of Directors of the
corporation shall consist of a number of persons not less than two, the exact
number to be determined from time to time by resolution adopted by the
affirmative vote of a majority of all directors of the corporation then holding
office at any special or regular meeting. Any resolution increasing or
decreasing the number of directors shall have the effect of creating or
eliminating a vacancy or vacancies, as the case may be, provided that no
resolution shall reduce the number of directors below the number then holding
office.

         SECTION 5. TERM OF OFFICE. Each director shall hold office until the
annual meeting next succeeding his election and until his successor is elected
and qualified, or until his earlier resignation, removal from office or death.

         SECTION 6. ELECTION OF DIRECTORS. Directors shall be elected at the
annual meeting of shareholders, but when the annual meeting is not held or
directors are not elected thereat, they may be elected at a special meeting
called and held for that purpose. Directors shall be elected by a plurality of
the votes cast by the shares entitled to vote in the election at a meeting at
which a quorum is present.

         SECTION 7. VACANCIES. Any vacancy occurring in the Board of Directors,
including a vacancy created by an increase in the number of directors, may be
filled by the shareholders or by the affirmative vote of a majority of the
remaining directors though less than a quorum of the Board of Directors. A
director elected to fill a vacancy shall hold office only until the next
election of directors by the shareholders. If there are no remaining directors,
the vacancy shall be filled by the shareholders.

         SECTION 8. REMOVAL OF DIRECTORS. At a meeting of shareholders, any
director or the entire Board of Directors may be removed, with or without cause,
provided the notice of the meeting states that one of the purposes of the
meeting is the removal of the director or directors. A director may be removed
only if the number of votes cast for removal exceeds the number of votes cast
against removal.

         SECTION 9. QUORUM AND TRANSACTION OF BUSINESS. A majority of the number
of directors fixed pursuant to these Bylaws shall constitute a quorum for the
transaction of business The act of a majority of the directors present at a
meeting at which a quorum is present shall be the act of the Board of Directors.



                                       6


         SECTION 10. PLACE OF MEETING. Regular and special meetings of the Board
of Directors shall be held at the principal office of the corporation or as
determined by the Chairman of the Board, unless otherwise designated by
resolution from time to time by the Board of Directors.

         SECTION 11. TIME, NOTICE AND CALL OF MEETINGS. Regular meetings of the
Board of Directors shall be held without notice at the time and on the date
designated by resolution of the Board of Directors. Meetings of the Board of
Directors may be called by the Chairman of the Board, the chief executive
officer or any two directors. Upon determining the need for a special meeting,
the Chairman of the Board shall direct the secretary of the corporation to
provide written notice of the time, date and place of such special meeting of
the Board of Directors to each director by personal delivery, mail or courier
delivery or by facsimile at least two but not more than 15 days before the
meeting. Notice of a meeting of the Board of Directors need not be given to a
director who signs a waiver of notice either before, at or after the meeting.
Attendance of a director at a meeting constitutes a waiver of notice of that
meeting and waiver of all objections to the place of the meeting, the time of
the meeting, and the manner in which it has been called or convened, except when
a director states at the beginning of the meeting or promptly upon arrival at
the meeting, objection to the transaction of business because the meeting is not
lawfully called or convened. Neither the business to be transacted at, nor the
purpose of, any regular or special meeting of the Board of Directors must be
specified in the notice or waiver of notice of the meeting. Notice of an
adjourned meeting shall be given to the directors who were not present at the
time of the adjournment and, unless the time and place of the adjourned meeting
are announced at the time of the adjournment, to the other directors. Members of
the Board of Directors (and any committee of the Board) may participate in a
meeting of the Board of Directors (or committee) by means of a conference
telephone or similar communications equipment pursuant to which all persons
participating in the meeting can hear each other at the same time. Participation
by these means constitutes presence in person at a meeting.

         SECTION 12. ACTION WITHOUT A MEETING. Any action required to be taken
at a meeting of the Board of Directors (or a committee), and any action which
may be taken at a meeting of the Board of Directors (or a committee) may be
taken without a meeting if a consent in writing, setting forth the action to be
taken and signed by all of the directors (or members of the committee), is filed
in the minutes of the proceedings of the Board of Directors. The action taken
shall be deemed effective when the last director signs the consent, unless the
consent specifies otherwise.


                                   ARTICLE III
                                   COMMITTEES

         SECTION 1. EXECUTIVE COMMITTEE. The Board of Directors may from time to
time, by resolution passed by a majority of the whole Board of Directors, create
an executive committee of three or more directors, the members of which shall be
elected by the Board of Directors to serve at the pleasure of the Board of
Directors. If the Board of Directors does not designate a chairman of the
executive committee, the executive committee shall elect a chairman from its own




                                       7


members. Except as otherwise required by law, these bylaws, or in the resolution
creating an executive committee, such committee shall, during the intervals
between the meetings of the Board of Directors, possess and may exercise all of
the powers of the Board of Directors in the management of the business and
affairs of the corporation, other than that of filling vacancies among the
directors or in any committee of the directors. The executive committee shall
keep full records and accounts of its proceedings and transactions. All action
by the executive committee shall be reported to the Board of Directors at its
meeting next succeeding such action and shall be subject to control, revision
and alteration by the Board of Directors, provided that no rights of third
persons shall be prejudicially affected thereby. Vacancies in the executive
committee shall be filled by the Board of Directors, and the Board of Directors
may appoint one or more directors as alternate members of the executive
committee who may take the place of any absent member or members at any meeting.

         SECTION 2. MEETINGS OF EXECUTIVE COMMITTEE. Subject to the provisions
of these Bylaws, the executive committee shall fix its own rules of procedure
and shall meet as provided by such rules or by resolutions of the Board of
Directors, and it shall also meet at the call of the Chairman of the Board, the
chairman of the executive committee or any two members of the committee. Unless
otherwise provided by such rules or by such resolutions, the provisions of
Section 11 of Article II relating to the notice required to be given for
meetings of the Board of Directors shall also apply to meetings of the executive
committee. A majority of the executive committee shall be necessary to
constitute a quorum.

         SECTION 3. OTHER COMMITTEES. The Board of Directors may by resolution
provide for such other standing or special committees as it deems desirable, and
discontinue the same at its pleasure. Each such committee shall have such powers
and perform such duties, not inconsistent with law, as may be delegated to it by
the Board of Directors. The provisions of Section 1 and Section 2 of this
Article III shall govern the appointment and action of such committee so far as
consistent, unless otherwise provided by the Board of Directors. Vacancies in
such committees shall be filled by the Board of Directors or as the Board of
Directors may provide.


                                   ARTICLE IV
                                    OFFICERS

         SECTION 1. GENERAL PROVISIONS. The Board of Directors shall appoint a
Chairman of the Board of Directors, a chief executive officer, a president, and
a secretary. A person may hold more than one such office. The Board of Directors
may from time to time create such offices and appoint such other officers,
subordinate officers and assistant officers as it may determine. The Chairman of
the Board, shall be, but the other officers need not be, chosen from among the
members of the Board of Directors. Each officer shall hold office at the
pleasure of the Board of Directors, and perform such duties as the Board of
Directors may prescribe. The Board of Directors may, from time to time,
authorize any officer to appoint and remove subordinate and assistant officers,
to prescribe their authority and duties, and to fix their compensation.




                                       8


         SECTION 2. TERM OF OFFICE. The officers of the corporation shall hold
office at the pleasure of the Board of Directors, and, unless sooner removed by
the Board of Directors, until the annual meeting of the Board of Directors
following the date of their appointment and until their successors are chosen
and qualified. The Board of Directors may remove any officer at any time, with
or without cause. A vacancy in any office established by these Bylaws or created
by the Board of Directors shall be filled by the Board of Directors.

         SECTION 3. CHAIRMAN OF THE BOARD. The Chairman of the Board shall
preside at all meetings of the Board of Directors and meetings of shareholders.

         SECTION 4. CHIEF EXECUTIVE OFFICER. The chief executive officer shall
exercise supervision over the management of the business of the corporation and
its several officers, subject, however, to the oversight of the Board of
Directors. In the absence of the Chairman of the Board, he shall preside at
meetings of the shareholders.

         SECTION 5. PRESIDENT. The president shall exercise supervision over the
management of the business of the corporation and its several officers, subject,
however, to the oversight of the Board of Directors and the chief executive
officer. In the absence of the Chairman of the Board and chief executive
officer, he shall preside at meetings of the shareholders.

         SECTION 6. SECRETARY. The secretary shall keep minutes of all the
proceedings of the shareholders and the Board of Directors and shall make proper
records of the same, which shall be attested by him; shall have authority to
execute and deliver certificates as to any of such proceedings and any other
records of the corporation; shall give notice of meetings of shareholders and
directors; shall produce on request at each meeting of shareholders a certified
list of shareholders arranged in alphabetical order; shall keep such books and
records as may be required by law or by the Board of Directors; and, in general,
shall perform all duties incident to the office of secretary and such other
duties as may from time to time be assigned to him by the Board of Directors or
the president.

         SECTION 7. DUTIES OF OFFICERS MAY BE DELEGATED. In the absence of any
officer of the corporation, or for any other reason the Board of Directors may
deem sufficient, the Board of Directors may delegate, for such period of time as
the Board of Directors deem appropriate, the powers or duties, or any of them,
of any officer to any other officer or to any director.

         SECTION 8. REMOVAL OF CERTAIN OFFICERS. Neither the Chairman, the chief
executive officer nor the president may be removed from office unless such
removal shall have first been approved by a majority of the whole Board of
Directors.


                                       9


                                    ARTICLE V
                           SHARE CERTIFICATE AND SEAL

         SECTION 1. FORM AND EXECUTION. Certificates for shares, certifying the
number of fully-paid shares owned, shall be issued to each shareholder in such
form as shall be approved by the Board of Directors. Such certificates shall be
signed by the Chairman of the Board, the chief executive officer or the
president and by the secretary; provided, however, that if such certificates are
countersigned by a transfer agent and/or registrar the signatures of any of said
officers and the seal of the corporation upon such certificates may be
facsimiles, engraved, stamped or printed. If any officer or officers who shall
have signed, or whose facsimile signature shall have been used, printed or
stamped on any certificate or certificates for shares, shall cease to be such
officer or officers, because of death, resignation or otherwise, before such
certificate or certificates shall have been delivered by the corporation, such
certificate or certificates, if authenticated by the endorsement thereon of the
signature of a transfer agent or registrar, shall nevertheless be conclusively
deemed to have been adopted by the corporation by the use and delivery thereof
and shall be as effective in all respects as though signed by a duly elected,
qualified and authorized officer or officers, and as though the person or
persons who signed such certificate or certificates, or whose facsimile
signature or signatures shall have been used thereon, had not ceased to be an
officer or officers of the corporation. The failure of the corporation to note
upon a certificate a restriction on the transfer of shares imposed or which may
be imposed by law, contract or otherwise, shall not be deemed to imply that such
shares are free of any such restriction or create in favor of the person to whom
such certificate is issued, or any successor, assign, devise or heir of such
recipient, any cause of action of any nature against the corporation.

         SECTION 2. REGISTRATION OF TRANSFER. Any certificate for shares of the
corporation shall be transferable (subject to any applicable restrictions
imposed or which may be imposed by law, contract or otherwise) in person or by
attorney upon the surrender thereof to the corporation or any transfer agent
therefor (for the class of shares represented by the certificate surrendered)
properly endorsed for transfer and accompanied by such assurances as the
corporation or such transfer agent may require as to the genuineness and
effectiveness of each necessary endorsement.

         SECTION 3. LOST, STOLEN OR DESTROYED CERTIFICATES. The corporation
shall, upon the authorization of the Chairman of the Board, the chief executive
officer, the president, the secretary or such other person as is authorized by
resolution of the Board of Directors, issue a new stock certificate in the place
of any certificate previously issued if the holder of record of the certificate
(a) makes proof in affidavit form that it has been lost, destroyed or wrongfully
taken; (b) requests the issue of a new certificate before the corporation has
notice that the certificate has been acquired by a purchaser for value in good
faith and without notice of any adverse claim; (c) gives bond in such form as
the corporation may direct to indemnify the corporation and any transfer agent
and registrar against any claim that may be made on account of the alleged loss,
destruction, or theft of a certificate; and (d) satisfies any other reasonable
requirements imposed by the corporation.

         SECTION 4. SEAL. The corporate seal shall be circular in form and
include the name of the corporation.
                                       10



                                   ARTICLE VI
                                  DISTRIBUTIONS

         The Board of Directors may, from time to time, declare distributions to
its shareholders in cash, property, or its own shares, unless the distribution
would cause (i) the corporation to be unable to pay its debts as they become due
in the usual course of business, or (ii) the corporation's assets to be less
than its liabilities plus the amount necessary, if the corporation were
dissolved at the time of the distribution, to satisfy the preferential rights of
shareholders whose rights are superior to those receiving the distribution. The
shareholders and the corporation may enter into an agreement requiring the
distribution of corporate profits, subject to the provisions of applicable law.


                                   ARTICLE VII
                            MISCELLANEOUS PROVISIONS

         SECTION 1. FISCAL YEAR. The fiscal year of the corporation shall be the
calendar year.

         SECTION 2. RESIGNATION. Any director or officer of the corporation may
resign his office at any time upon presenting his written resignation to the
Board of Directors, the Chairman of the Board, the chief executive officer, the
president or the secretary, and, unless some time be fixed in such resignation
as the date upon which it is to become effective, the same shall become
effective immediately upon presentation. The acceptance of a resignation shall
not be required to make it effective, unless otherwise so stated in such
resignation, and in that event it shall become effective at the pleasure of the
Board of Directors.

         SECTION 3. VOTING UPON STOCKS OF OTHER CORPORATIONS. Unless otherwise
ordered by the Board of Directors, the Chairman of the Board, the chief
executive officer, or the president shall, in the order above stated, have full
power and authority on behalf of the corporation to attend, act and vote at any
meeting or meetings of shareholders of any corporation in which the corporation
may hold stock or other securities, and at any such meeting shall possess and
may exercise on behalf of the corporation any and all of the rights and powers
incident to the ownership of such stock or other securities. The person having
the power and authority as set forth above may in his discretion delegate the
same to another person that he designates to act on behalf of the corporation at
any given meeting. The Board of Directors, by resolution, may from time to time
confer like powers upon any other person or persons.


                                  ARTICLE VIII
                        CORPORATE RECORDS, SHAREHOLDERS'
                    INSPECTION RIGHTS; FINANCIAL INFORMATION

         SECTION 1. CORPORATE RECORDS.


                                       11


         (a) The corporation shall keep as permanent records minutes of all
meetings of its shareholders and the Board of Directors, a record of all actions
taken by the shareholders or Board of Directors without a meeting, and a record
of all actions taken by a committee of the Board of Directors.

         (b) The corporation shall maintain a record of its shareholders in a
form that permits preparation of a list of the names and addresses of all
shareholders in alphabetical order by class of shares showing the number and
series of shares held by each.

         (c) The corporation shall keep a copy of: (i) its articles or restated
articles of incorporation and all amendments to them currently in effect; (ii)
these Bylaws or restated Bylaws and all amendments currently in effect; (iii)
resolutions adopted by the Board of Directors creating one or more classes or
series of shares and fixing their relative rights, preferences, and limitations,
if shares issued pursuant to those resolutions are outstanding; (iv) the minutes
of all shareholders' meetings and records of all actions taken by shareholders
without a meeting for the past three years; (v) written communications to all
shareholders generally or all shareholders of a class of series within the past
three years, including the financial statements furnished for the last three
years; (vi) a list of names and business street addresses of its current
directors and officers; and (vii) its most recent annual report delivered to the
Department of State.

         (d) The corporation shall maintain its records in written form or in
another form capable of conversion into written form within a reasonable time.

         SECTION 2. SHAREHOLDERS' INSPECTION RIGHTS. A shareholder is entitled
to inspect and copy, during regular business hours at the corporation's
principal office, any of the corporate records described in Section 1(c) of this
Article if the shareholder gives the corporation written notice of the demand at
least 5 business days before the date on which he wishes to inspect and copy the
records.

         A shareholder is entitled to inspect and copy, during regular business
hours at a reasonable location specified by the corporation, any of the
following records of the corporation if the shareholder gives the corporation
written notice of this demand at least 5 business days before the date on which
he wishes to inspect and copy provided (a) the demand is made in good faith and
for a proper purpose; (b) the shareholder describes with reasonable
particularity the purpose and the records he desires to inspect; and (c) the
records are directly connected with the purpose: (i) excerpts from minutes of
any meeting of the Board of Directors, records of any action of a committee of
the Board of Directors while acting in place of the Board of Directors on behalf
of the corporation; (ii) accounting records; (iii) the record of shareholders;
and (iv) any other books and records of the corporation.

         This Section 2 does not affect the right of a shareholder to inspect
and copy the shareholders' list described in Section 6 of Article I or, if the
shareholder is in litigation with the corporation, to the same extent as any
other litigant or the power of a court to compel the production of corporate
records for examination.



                                       12


         The corporation may deny any demand for inspection if the demand was
made for an improper purpose, or if the demanding shareholder has within the two
years preceding his demand, sold or offered for sale any list of shareholders of
the corporation or of any other corporation, has aided or abetted any person in
procuring any list of shareholders for that purpose, or has improperly used any
information secured through any prior examination of the records of the
corporation or any other corporation.

         SECTION 3. FINANCIAL STATEMENTS FOR SHAREHOLDERS. Unless modified by
resolution of the shareholders within 120 days after the close of each fiscal
year, the corporation shall furnish its shareholders with annual financial
statements which may be consolidated or combined statements of the corporation
and one or more of its subsidiaries, as appropriate, that include a balance
sheet as of the end of the fiscal year, an income statement for that year, and a
statement of cash flows for that year. If financial statements are prepared for
the corporation on the basis of generally accepted accounting principles, the
annual financial statements must also be prepared on that basis.

         If the annual financial statements are reported upon by a public
accountant, his report must accompany them. If not, the statements must be
accompanied by a statement of the chief financial officer or the person
responsible for the corporation's accounting records stating his reasonable
belief whether the statements were prepared on the basis of generally accepted
accounting principles and, if not, describing the basis of preparation and
describing any respects in which the statements were not prepared on a basis of
accounting consistent with the statements prepared for the preceding year.

         The corporation shall mail the annual financial statements to each
shareholder within 120 days after the close of each fiscal year or within such
additional time thereafter as is reasonably necessary to enable the corporation
to prepare its financial statements. Thereafter, on written request from a
shareholder who was not mailed the statements, the corporation shall mail him
the latest annual financial statements.

         SECTION 4. OTHER REPORTS TO SHAREHOLDERS. If the corporation
indemnifies or advances expenses to any director, officer, employee or agent
otherwise than by court order or action by the shareholders or by an insurance
carrier pursuant to insurance maintained by the corporation, the corporation
shall report the indemnification or advance in writing to the shareholders with
or before the notice of the next annual shareholders' meeting, or prior to the
meeting if the indemnification or advance occurs after the giving of the notice
but prior to the time the annual meeting is held. This report shall include a
statement specifying the persons paid, the amounts paid, and the nature and
status at the time of such payment of the litigation or threatened litigation.

         If the corporation issues or authorizes the issuance of shares for
promises to render services in the future, the corporation shall report in
writing to the shareholders the number of shares authorized or issued, and the
consideration received by the corporation, with or before the notice of the next
shareholders' meeting.


                                       13


                                   ARTICLE IX
                                 INDEMNIFICATION

         SECTION 1. RIGHT TO INDEMNIFICATION. Each person (including here and
hereinafter, the heirs, executors, administrators, or estate of such person) (i)
who is or was a director or officer of the corporation, (ii) who is or was an
agent or employee of the corporation other than an officer and as to whom the
corporation has agreed to grant such indemnity, or (iii) who is or was serving
at the request of the corporation as its representative in the position of
director, officer, agent or employee of another corporation, partnership, joint
venture, trust or other enterprise and as to whom the corporation has agreed to
grant such indemnity shall be indemnified by the corporation as of right to the
fullest extent permitted or authorized by current or future legislation or by
current or future judicial or administrative decision (but, in the case of any
such future legislation or decision, only to the extent that it permits the
corporation to provide broader indemnification rights than permitted prior to
such legislation or decision), against any liability or expense, awarded or
assessed against him, or incurred by him, in his capacity as such director,
officer, agent, employee or representative, or arising out of his status as such
director, officer, agent, employee, or representative, including (in the case of
derivative actions) expenses and amounts paid by him in settlement of any
proceeding asserted or brought against him in his aforesaid capacity or arising
out of his status as such.

         SECTION 2. ADVANCEMENT OF EXPENSES. Expenses incurred by a person
referred to in Section 1 of this Article IX in defending a proceeding shall be
paid by the corporation in advance of the final disposition of such proceeding,
(i) upon receipt, in the case of a director or officer, of an undertaking by or
on behalf of the director or officer to repay all amounts so advanced if he is
ultimately found not to be entitled to be indemnified by the corporation
pursuant to this Article IX, and (ii) upon satisfaction of such other conditions
as are required by current or future legislation (but, with respect to future
legislation, only to the extent that it provides conditions less burdensome to
the director, officer, employee, agent or representative, and to the
corporation, than those provided previously). Such expenses incurred by other
employees, agents and representatives may be so paid upon such terms and
conditions, if any, as the Board of Directors deems appropriate. The Board of
Directors may, in the manner set forth above, and upon approval of such
director, officer, employee, agent or representative of the corporation,
authorize the corporation's counsel to represent such person, in any proceeding,
whether or not the corporation is a party to such proceeding.

         SECTION 3. PROCEDURE FOR INDEMNIFICATION AND OBTAINING ADVANCEMENT OF
EXPENSES. Any indemnification of liabilities and expenses or advancement of
expenses under this Article IX shall be made promptly, and in any event within
60 days, upon the written request of the director, officer, employee, agent or
representative seeking indemnification or an advancement. If the corporation
denies such request in whole or in part or if no disposition thereof is made
within 60 days of its receipt of such request or if the corporation otherwise
fails to provide indemnification or advancement provided for in this Article IX,
and despite any contrary determination by the corporation (including its Board
of Directors or a committee thereof, its independent legal counsel or its
shareholders) in the specific case, a director, officer, employee, agent or
representative may apply for indemnification or advancement, or both, in an



                                       14


appropriate proceeding brought in a court of competent jurisdiction and shall be
entitled to such indemnification or advancement, or both, as the court shall by
order direct. Such person's reasonable expenses in obtaining court-ordered
indemnification or advancement shall be reimbursed by the corporation. No such
contrary determination by the corporation (including the Board of Directors or a
committee thereof, its independent legal counsel or its shareholders) shall be a
defense to such proceeding or create a presumption that the claimant has not met
the applicable standard of conduct, if any, for indemnification or an
advancement.

         SECTION 4. OTHER RIGHTS, CONTINUATION OF RIGHT TO INDEMNIFICATION AND
ADVANCEMENTS. The indemnification and advancements provided by this Article IX
shall not be deemed exclusive of any other or further rights to which a person
seeking indemnification or advancements may be entitled under any law (common or
statutory), agreement, vote of shareholders or disinterested directors or
otherwise, either as to action taken or omitted to be taken in his official
capacity or as to action taken or omitted to be taken in another capacity while
holding office or while employed by or acting as agent for the corporation. All
rights to indemnification and to advancements of expenses under this Article IX
shall be deemed to be a contract between the corporation and each director,
officer, employee, agent or representative of the corporation described in
Section 1 of this Article IX who serves or has served in any such capacity at
any time while this Article IX is in effect.

         Any repeal or modification of this Article IX, or any repeal or
modification of relevant provisions of the Florida Business Corporation Act or
any other applicable law, shall not in any way diminish any right to
indemnification or to advancement of expenses of such director, officer,
employee, agent or representative, or the obligations of the corporation,
arising hereunder prior to such repeal or modification.

         SECTION 5. INSURANCE. The corporation may purchase and maintain
insurance, at its expense, to protect itself and any person who is or was or has
agreed to become a director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise against any liability asserted against him and incurred by him
or on his behalf in any such capacity, or arising out of his status as such,
whether or not the corporation would have the legal power to directly indemnify
him against such liability.

         SECTION 6. SAVINGS CLAUSE. If this Article IX or any portion hereof
shall be invalidated on any ground by any court of competent jurisdiction, then
the corporation shall nevertheless indemnify each director and officer, and each
employee, agent and representative of the corporation described in Section 1 of
this Article IX, as to liabilities and expenses, and amounts paid in settlement
with respect to any proceeding, including any action by or in the right of the
corporation, to the full extent permitted by any applicable portion of this
Article IX that shall not have been invalidated and to the full extent permitted
by applicable law.



                                       15


         SECTION 7. TERMS. For purposes of this Article IX, the term "other
enterprises" includes employee benefit plans; the term "expenses" includes
counsel fees, including those for appeal; the term "liability" includes
obligations to pay a judgment, settlement, penalty, fine (including an excise
tax assessed with respect to any employee benefit plan), and expenses actually
and reasonably incurred with respect to a proceeding; the term "proceeding"
includes any threatened, pending, or completed action, suit, or other type of
proceeding, whether civil, criminal, administrative, or investigative and
whether formal or informal; the term "agent" includes a volunteer; and the term
"serving at the request of the corporation" includes any service as a director,
officer, employee or agent of the corporation that imposes duties on such
persons, including duties relating to an employee benefit plan and its
participants or beneficiaries.




                                       16




                                    ARTICLE X
                                    AMENDMENT

         These Bylaws may be altered, amended or repealed, and new Bylaws
adopted, by the Board of Directors or shareholders.








                                       17

EX-99.1

                                                                    EXHIBIT 99.1


I, Phillip Frost, M.D., Chairman and Chief Executive Officer of IVAX
Corporation, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
that:


(1)      the Quarterly Report of IVAX Corporation on Form 10-Q for the quarterly
         period ended June 30, 2002 (the "Periodic Report"), which this
         statement accompanies, fully complies with the requirements of Section
         13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)      information contained in the Periodic Report fairly presents, in all
         material respects, the financial condition and results of operations of
         IVAX Corporation.




                                     /s/ Phillip Frost, M.D.
                                     -----------------------------------------
                                     Phillip Frost, M.D.
                                     Chairman and Chief Executive Officer
                                     August 13, 2002

EX-99.2

                                                                    EXHIBIT 99.2


I, Thomas E. Beier, Senior Vice President - Finance and Chief Financial Officer
of IVAX Corporation, certify, pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002, that:


(3)      the Quarterly Report of IVAX Corporation on Form 10-Q for the quarterly
         period ended June 30, 2002 (the "Periodic Report"), which this
         statement accompanies, fully complies with the requirements of Section
         13(a) or 15(d) of the Securities Exchange Act of 1934; and

(4)      information contained in the Periodic Report fairly presents, in all
         material respects, the financial condition and results of operations of
         IVAX Corporation.




                                     /s/ Thomas E. Beier
                                     ----------------------------------------
                                     Thomas E. Beier
                                     Senior Vice President - Finance and
                                     Chief Financial Officer
                                     August 13, 2002