-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, DsjrjoIdxEpSBEC70RLB9gHYAViqRdUklE3TW4ACE8vvlHFB7hA5WANUgQotZy/S V2Lt0IvYZ/UUEVJNHeEM8Q== 0000895345-01-500090.txt : 20010501 0000895345-01-500090.hdr.sgml : 20010501 ACCESSION NUMBER: 0000895345-01-500090 CONFORMED SUBMISSION TYPE: 10-K/A PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20001231 FILED AS OF DATE: 20010430 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ICN PHARMACEUTICALS INC CENTRAL INDEX KEY: 0000930184 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 330628076 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K/A SEC ACT: SEC FILE NUMBER: 001-11397 FILM NUMBER: 1615571 BUSINESS ADDRESS: STREET 1: 3300 HYLAND AVE CITY: COSTA MESA STATE: CA ZIP: 92626 BUSINESS PHONE: 7145450100 MAIL ADDRESS: STREET 1: 3300 HYLAND AVE CITY: COSTA MESA STATE: CA ZIP: 92626 FORMER COMPANY: FORMER CONFORMED NAME: ICN MERGER CORP DATE OF NAME CHANGE: 19940915 10-K/A 1 form10ka.txt FORM 10-K/A ============================================================================= SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K/A (AMENDMENT NO. 2) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE YEAR ENDED DECEMBER 31, 2000 COMMISSION FILE NUMBER 1-11397 ICN PHARMACEUTICALS, INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) DELAWARE 33-0628076 (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.) 3300 HYLAND AVENUE, COSTA MESA, CALIFORNIA 92626 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE) REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (714) 545-0100 SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: TITLE OF EACH CLASS NAME OF EACH EXCHANGE ON ------------------- WHICH REGISTERED COMMON STOCK, $.01 PAR VALUE ---------------- (INCLUDING ASSOCIATED PREFERRED NEW YORK STOCK EXCHANGE STOCK PURCHASE RIGHTS) 9 1/4% SENIOR NOTES DUE 2005 NEW YORK STOCK EXCHANGE SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: NONE 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, and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ] Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ ] The aggregate market value of the Registrant's voting stock held by non-affiliates of the Registrant on March 12, 2001, was approximately $1,870,154,941. The number of outstanding shares of the Registrant's common stock as of March 12, 2001 was 80,236,646. DOCUMENTS INCORPORATED BY REFERENCE None. ============================================================================= EXPLANATORY NOTE Since a Definitive Proxy for the 2001 Annual Meeting of Stockholders will not be filed by April 30, 2001, following is the information required by Part III of Form 10-K. This Amendment No. 2 on Form 10-K/A to the Annual Report on Form 10-K of ICN Pharmaceuticals, Inc. filed on April 2, 2001 amends and restates in its entirety Item 14 of Part IV for the sole purpose of adding Exhibits 4.1 and 4.2, which additions are being filed herewith. PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT. The Board of Directors currently consists of fourteen members and will consist of twelve members after this election: Ms. Campbell and Mr. Irani whose terms expire in 2001, are standing for election for terms expiring in 2004; Messrs. Barker, Bayh, Charles, Jerney and Moses and Ms. Tomich are serving until the 2002 Annual Meeting of Stockholders and Dr. Guillemin and Messrs. Kurz and Panic are serving until the 2003 Annual Meeting of Stockholders. Mr. Manatt, who is not currently a director, is standing for election for a term expiring in 2004. Set forth below with respect to each director is certain personal information, including the present principal occupation and recent business experience, age, year commenced service as a director of the Company (including service as a director of a predecessor company) and other corporate directorships. Richard W. Starr, a director of the Company, passed away on January 29, 2001. Messrs. Andrei Kozyrev, Thomas Lenagh, and Roberts A. Smith, whose terms expire in 2001, are not seeking re-election.
Year Commenced Serving as Director of Name and Principal Occupation Age the Company Other Corporate Directorships - ----------------------------- --- ----------- ----------------------------- Directors Nominated for Election RAY IRANI, Ph. D..................................... 66 2001 Cedars Bank; KB Home; Canadian Occidental Dr. Irani has been Chairman and Chief Executive Petroleum Corporation Officer of Occidental Petroleum Corporation since 1990 and a director since 1984. He served as President of Occidental Petroleum from 1984 until July 1996. He was Chief Operating Officer of Occidental Petroleum from 1984 to 1990. He was Chairman of the Board of Directors of Canadian Occidental Petroleum Ltd. from 1987 to 1999. KIM CAMPBELL, PC, QC (a) (b)......................... 53 2000 e-Sim Ltd.; Interiorslive.com Ms. Campbell has been a lawyer consulting in the area of mediation and conflict resolution. Since January 2001, Ms. Campbell has been a Fellow at the Center for Public Leadership at the John F. Kennedy School of Government at Harvard University. From September 2000 until January 2001, Ms. Campbell was an author and lecturer. She was the Consul General of Canada in Los Angeles from September 1996 until September 2000. From February 1996 until September 1996 she was an author and lecturer. Ms. Campbell held several positions in the Canadian government including Prime Minister from June, 1993 to November, 1993, Minister of Justice and Attorney General from February, 1990 to January, 1993, and Minister of National Defense from January, 1993 to June, 1993. Ms. Campbell also serves on the Governing Board of Harvard University, Northeastern University, UCLA and the Thunderbird American Graduate School of International Management. CHARLES T. MANATT.................................... 64 1992(h) Mr. Manatt is a partner in the law firm of Manatt, Phelps & Phillips, of which he was a founder in 1965. He has been a member of that firm since its inception, except during the period when he was the United States Ambassador to the Dominican Republic. He was the United States Ambassador to the Dominican Republic from December 1999 until March 2001. Mr. Manatt served as Chairman of the Democratic Party from 1981 to 1985. Directors Whose Terms Expire in 2002 NORMAN BARKER, JR.(c) (d) (b)........................ 78 1988 Bank Plus, Inc.; TCW Convertible Securities, Mr. Barker is the retired Chairman of the Board of Inc. First Interstate Bank of California and Former Vice Chairman of the Board of First Interstate Bancorp. Mr. Barker joined First Interstate Bank of California in 1957 and was elected President and Director in 1968, Chief Executive Officer in 1971 and Chairman of the Board in 1973. He retired as Chairman of the Board at the end of 1985. BIRCH E. BAYH, JR., ESQ.(c) (b)...................... 72 1992 Simon Property Group Sen. Bayh is a senior partner in the Washington, D.C. law firm of Oppenheimer, Wolff & Donnelly LLP. He previously was head of the Washington office of Bayh, Connaughton & Stewart, L.L.P. (1991 - 1997) and Rivkin, Radler, Bayh, Hart & Kremer (1985 - 1991), and a partner in the Indianapolis, Indiana and Washington, D.C. law firm of Bayh, Tabbert & Capehart (1981 - 1985). Mr. Bayh served as a United States Senator from the State of Indiana from 1963 - 1981. ALAN F. CHARLES (c) (e) (f).......................... 62 1986 Rand Institute of Civil Justice Mr. Charles was Vice Chancellor of University Relations at the University of California, Los Angeles from 1980 to 1993 and served in various administrative capacities at that university since 1972. He is now an independent consultant in higher education management. ADAM JERNEY............................................ 59 1992 Mr. Jerney is Chief Operating Officer and President of ICN. He served as Chairman of the Board and Chief Executive Officer of ICN from July 14, 1992 to March 4, 1993 during Milan Panic's leave of absence. Mr. Jerney joined ICN in 1973 as Director of Marketing Research in Europe and assumed the position of General Manager of ICN Netherlands in 1975. In 1981, he was elected Vice President -- Operations and in 1987 he became President and Chief Operating Officer of SPI Pharmaceuticals, Inc., then a subsidiary of the Company. He became President of the Company in 1997. Prior to joining ICN, he spent four years with F. Hoffmann-LaRoche & Company. STEPHEN D. MOSES (c)(f)(e)........................... 66 1988 The Central Asian-American Enterprise; Mr. Moses is Chairman of the Board of Stephen Moses Steadfast Ventures, Inc. Interests. He was formerly Chairman of the Board of National Investment Development Corporation and Brentwood Bank in Los Angeles, California. Mr. Moses serves on the Board of Directors of The Central Asian-American Enterprise Fund and is Chair of its investment committee. He is a member of the Board of Directors of Steadfast Ventures, Inc. He also serves on the Board of Councilors of The UCLA Foundation and is a Trustees emeritus of Franklin and Marshall College. ROSEMARY TOMICH...................................... 63 2001 Occidental Petroleum Corporation Ms. Tomich has been owner of the Hope Cattle Company since 1958 and the A. S. Tomich Construction Company since 1970. She is also Chairman of the Board of Directors and Chief Executive Officer, Livestock Clearing, Inc. and was a founding director of the Palm Springs Savings Bank. Ms. Tomich is also a member of the Advisory Board of the University of Southern California School of Business Administration and on the Board of Councilors of the UCLA Foundation. Directors Whose Terms Expire in 2003 ROGER GUILLEMIN, M.D., Ph.D.(a)...................... 77 1989 Theratechnologies, Inc; CEREP S.A. Dr. Guillemin has been an Adjunct Professor of Medicine at the University of California College of Medicine in San Diego since 1970. He was a Distinguished Scientist at the Whittier Institute in La Jolla, California from March 1989 to 1995 and was Resident Fellow and Chairman of the Laboratories for Neuroendocrinology at the Salk Institute in La Jolla, California. Dr. Guillemin was awarded the Nobel Prize in Medicine in 1977 and, in the same year, was presented the National Medal of Science by the President of the United States. He was affiliated with the Department of Physiology at Baylor College of Medicine in Houston, Texas from 1952 to 1970. Dr. Guillemin is a member of the National Academy of Sciences, and a Fellow of the American Association for the Advancement of Science. He has also served as President of the American Endocrine Society. JEAN-FRANCOIS KURZ (d) (g)........................... 67 1989 Board of Banque Pasche S.A., Geneva Mr. Kurz was a member of the Board of Directors and the Executive Committee of the Board of DG Bank Switzerland Ltd. from 1990 to 1992. In 1988 and 1989, Mr. Kurz served as a General Manager of TDB American Express Bank of Geneva and from 1969 to 1988, he was Chief Executive Officer of Banque Gutzweiler, Kurz, Bungener in Geneva. Mr. Kurz is also Chairman of the Board of Banque Pasche S.A., Geneva. MILAN PANIC (g)...................................... 71 1960 Mr. Panic, the founder of ICN, has been Chairman of the Board and Chief Executive Officer of ICN since its inception in 1960 and served as President until 1997. He was on a leave of absence from July 14, 1992 to March 4, 1993 while he was serving as Prime Minister of Yugoslavia and a leave of absence from October 1979 to June 1980. Directors Not Standing For Re-Election THOMAS H. LENAGH (f) (d) (e)......................... 82 1979 Adams Express; Gintel Corp; ASD Group Fund; Mr. Lenagh is Chairman of the Board of Inrad Corp. Clemente Strategic Fund; Inrad Corp. and an independent financial advisor. He was Chairman of the Board and CEO of Greiner Engineering, Inc. from 1982 to 1985. Mr. Lenagh served as Financial Vice President to the Aspen Institute from 1978 to 1980, and since then as an independent financial consultant. From 1964 to 1978, he was Treasurer of the Ford Foundation. ROBERTS A. SMITH, Ph.D.(c) (a) (g)................... 71 1960 PLC Medical Systems Dr. Smith was President of Viratek, Inc., then a subsidiary of the Company, and Vice President -- Research and Development of SPI Pharmaceuticals, Inc., then a subsidiary of the Company, through 1992. For more than eleven years, Dr. Smith was Professor of Chemistry and Biochemistry at the University of California at Los Angeles. ANDREI KOZYREV, Ph.D.(e)............................. 50 1998 Dr. Kozyrev has been Vice President -- Eastern Europe of ICN since 1999. Dr. Kozyrev joined ICN's Board in early 1998. He served as a member of the Russian Parliament from 1994 to 1999, and held several other senior level posts in Russia, including Minister of Foreign Affairs. Dr. Kozyrev earned his Ph.D. in History. He is also an author, having published several works on the Russian economy and international affairs. ____________ (a) Member of the Science and Technology Committee (b) Member of the Corporate Governance Committee (c) Member of the Compensation and Benefits Committee (d) Member of the Finance Committee (e) Member of the Communications Committee (f) Member of the Audit Committee (g) Member of the Executive Committee (h) Mr. Manatt had been a director of the Company from 1992 until December 1999 when he became Ambassador to the Dominican Republic, a position he left in March 2001. None of the directors are related by blood or marriage to one another or to an executive officer of the Company.
EXECUTIVE OFFICERS The executive officers of the Company are as follows: Name Age Present Position with the Company ---- --- --------------------------------- Milan Panic..................................... 71 Chairman of the Board and Chief Executive Officer Adam Jerney..................................... 59 Director, President and Chief Operating Officer Richard A. Meier................................ 41 Executive Vice President and Chief Financial Officer David C. Watt................................... 47 Executive Vice President, General Counsel and Corporate Secretary John E. Giordani................................ 58 Executive Vice President Bill A. MacDonald............................... 52 Executive Vice President, Strategic Planning Jack L. Sholl................................... 58 Executive Vice President, Public Relations Johnson Y.N. Lau................................ 40 Senior Vice President, Research and Development James G. McCoy.................................. 59 Executive Vice President, Human Resources
MILAN PANIC, the founder of ICN, has been Chairman of the Board and Chief Executive Officer of the Company since its inception in 1960 and President until 1997, except for a leave of absence from July 14, 1992 to March 4, 1993 while he was serving as Prime Minister of Yugoslavia and a leave of absence from October 1979 to June 1980. ADAM JERNEY has been President since January 1997 and has served as a director of ICN since 1992, at the time of Mr. Panic's leave of absence. He served as Chairman of the Board and Chief Executive Officer of ICN from July 14, 1992 to March 4, 1993 during Milan Panic's leave of absence (as discussed above). Mr. Jerney joined ICN in 1973 as Director of Marketing Research in Europe and assumed the position of General Manager of ICN Netherlands in 1975. In 1981, he was elected Vice President Operations. Prior to joining ICN, he spent four years with F. Hoffmann-LaRoche & Company. RICHARD A. MEIER joined ICN in May 1998 as Senior Vice President-- Finance and Corporate Treasurer. In January 2000, Mr. Meier was promoted to Executive Vice President and Chief Financial Officer. From October 1996 until joining ICN, Mr. Meier was a Senior Vice President with the investment banking firm of Schroder & Co. Inc. in New York, New York. From 1985 to October 1996, Mr. Meier served in various banking and private equity capacities at Salomon Smith Barney, Inc., Manufacturers Hanover Trust Corporation, Australian Capital Equity, Inc., and Windsor Hall Partners in New York and Dallas, Texas. DAVID C. WATT joined ICN in March 1988 as Assistant General Counsel and Secretary. He was elected Vice President Law and Secretary in December 1988. In January 1992, Mr. Watt was promoted to Senior Vice President of ICN. On February 1, 1994, Mr. Watt was elected Executive Vice President, General Counsel and Corporate Secretary of ICN. From 1986 to 1987, he was President and Chief Executive Officer of Unitel Corporation. He also served as Executive Vice President and General Counsel and Secretary of Unitel Corporation during 1986. From 1983 to 1986, he served with ICA Mortgage Corporation as Vice President, General Counsel and Corporate Secretary. Prior to that time, he served with Central Savings Association as Assistant Vice President and Associate Counsel from 1981 to 1983 and as Assistant Vice President from 1980 to 1981. JOHN E. GIORDANI joined ICN in June of 1986 as Senior Vice President and Chief Financial Officer. He served as ICN's Executive Vice President and Chief Financial Officer from 1992 to January 2000. Since January 2000, he has served as an Executive Vice President of the Company. Prior to joining ICN, Mr. Giordani served as Vice President and Corporate Controller of Revlon, Inc. in New York from 1982 through 1986 and Deputy and Assistant Corporate Controller with Revlon from 1978 through 1982. He was with the public accounting firm of Peat, Marwick, Mitchell & Co. (now known as "KPMG Peat Marwick LLP) from 1969 to 1978. BILL A. MACDONALD joined ICN in March 1982 as Director of Taxes. In 1983, he became Vice President -- Taxes and Corporate Development. In 1987, Mr. MacDonald became Senior Vice President -- Tax and Corporate Development and in 1992 was promoted to Executive Vice President -- Strategic Planning. From 1980 to 1982, he served as the Tax Manager of Pertec Computer Corporation. From 1973 to 1980, he was Tax Manager and Assistant Treasurer of Republic Corporation. JACK L. SHOLL joined ICN in August 1987 as Vice President, Public Relations. He was elected Senior Vice President -- Corporate Human Resources in September 1994. From 1979 to August 1987, he served as Director of Financial and Media Communications with Warner-Lambert Company of Morris Plains, New Jersey, and from 1973 to 1979 as Manager, Department of Communications with Equibank, N.A. of Pittsburgh, Pennsylvania. Prior to that time, he served on the Public Relations staff of the New York Stock Exchange (1971 -- 1973) and in editorial positions with The Associated Press (1971 -- 1986), the last as Supervising Business and Financial Editor in New York. JOHNSON Y.N. LAU M.D., PH.D., joined ICN in March 2000 as Senior Vice President, Research and Development. Before joining ICN, he was a Senior Director in Antiviral Research at the Schering-Plough Research Institute from 1997 until March 2000. He served as a faculty member at the University of Florida from 1992 to 1997. From 1989 to 1991, he served as a faculty member at the Institute of Liver Studies, King's College Hospital School of Medicine and Dentistry, University of London. JAMES G. MCCOY joined ICN in August 2000 as Executive Vice President, Human Resources. From 1979 to June 2000, he was with Coopers & Lybrand/PricewaterhouseCoopers LLP. He was the managing partner for the financial cost management and middle market partners on the West Coast. Previously, he was Director of Human Resources, Strategic Planning and Accounting for Warner Elektra Atlantic Distribution Company, a subsidiary of Warner Communications. Prior to that time, he was with the public accounting firm Ernst & Ernst (now Ernst & Young) and Litton Industries, Inc. In April 2001, Mr. Panic was advised that a "private criminal proceeding" was instituted against him in Switzerland by Tito Tettamanti alleging defamation. In Switzerland, a "private criminal action proceeding" is prosecuted by an aggrieved party who must himself bring charges against the accused. A district attorney or other government prosecutor is not involved in this proceeding. COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT Section 16(a) of the Exchange Act requires ICN's executive officers and directors, and persons who own more than ten percent of a registered class of ICN's equity securities, to file reports of ownership and changes in ownership with the Commission and the New York Stock Exchange. Such executive officers, directors and stockholders are required by Commission regulation to furnish ICN with copies of all Section 16(a) forms they file. Based on its review of the copies of such forms received by ICN, or written representations from certain reporting persons that no Forms 5 were required for those persons, ICN believes that during fiscal year 2000 all filing requirements applicable to its executive officers, directors and ten percent beneficial owners were timely satisfied with the exception of Adam Jerney, who filed a late Form 4. 11. EXECUTIVE COMPENSATION SUMMARY COMPENSATION TABLE The following table sets forth the annual and long-term compensation awarded to, earned by, or paid to the Chief Executive Officer and the four most highly paid executive officers of the Company (the "Named Executive Officers"), for services rendered to the Company in all capacities during the years ended December 31, 2000, 1999 and 1998.
Annual Compensation Long Term Compensation ------------------------------------------------ --------------------------- Other Annual Restricted Securities All Other Name and Compensation Stock Underlying Compensation Principal Position Year Salary($) Bonus($) ($)(1) Awards(#)(2) Options(#)(3) ($)(4) ------------------ ---- --------- -------- ------------ ------------ ------------- ------------ Milan Panic.................... 2000 750,366 478,700 -- -- 235,053(5) Chairman and 1999 701,277 413,821 -- 100,000 304,157 Chief Executive Officer 1998 701,277 1,336,000 4,013,966 253,542 193,366 Adam Jerney.................... 2000 452,572 253,400 -- -- 19,702(6) President and 1999 422,940 450,000 -- 30,000 27,597 Chief Operating Officer 1998 422,940 235,773 1,204,183 50,000 40,144 Richard A. Meier............... 2000 320,000 163,000 -- -- 4,600(7) Executive Vice President 1999 246,128 155,000 -- 150,000 7,714 and Chief Financial Officer 1998 155,538 285,000 -- -- 7,215 Bill MacDonald................. 2000 320,000 163,000 -- -- 6,252(8) Executive Vice President 1999 222,600 96,433 -- 30,000 2,978 Strategic Planning 1998 222,600 328,567 802,800 45,000 3,100 John E. Giordani............... 2000 320,000 163,000 -- -- 17,979(9) Executive Vice President 1999 312,375 50,000 -- 30,000 19,413 1998 312,375 423,900 802,800 45,000 14,490 ____________
(1) Unless otherwise indicated, with respect to any individual named in the above table, the aggregate amount of perquisites and other personal benefits, securities or property was less than either $50,000 or 10% of the total annual salary and bonus reported for the named executive officer. (2) Includes award of restricted stock under the Company's Long Term Incentive Plan. The values of restricted stock awards presented in the table are based upon the market value of the common stock as of the date awarded. The restricted shares vest 25% per year, starting one year from the date of grant. At December 31, 2000, the aggregate number of shares of restricted stock and the value thereof were: Mr. Panic, 61,127 shares, $1,875,835; Mr. Jerney, 18,338 shares, $562,747; Mr. Giordani, 12,225 shares, $375,155 and Mr. MacDonald, 12,225 shares, $375,155. Dividends are paid on the restricted shares to the same extent paid on the Company's common stock, and are held in escrow until the related shares are vested. (3) Includes grants of options to purchase shares of the Company's common stock. (4) Except where otherwise indicated, the amounts in this column represent matching contributions to the Company's 401(K) plan, amounts accrued under an executive deferral plan and medical benefits and medical and life insurance premiums. (5) In 2000, the $235,053 of "All Other Compensation" Mr. Panic received consisted of the following: executive medical ($1,235), life insurance ($9,552), interest ($160,619) and legal expenses ($63,350). (6) In 2000, the $19,702 of "All Other Compensation" Mr. Jerney received consisted of the following: accounting-tax ($10,000), executive medical ($4,748), tennis club ($770) and life insurance ($4,184). (7) In 2000, the $4,600 of "All Other Compensation" Mr. Meier received consisted of the following: executive medical ($3,794) and life insurance ($805). (8) In 2000, the $6,252 of "All Other Compensation" Mr. MacDonald received consisted of the following: executive medical ($3,868) and life insurance ($2,384). (9) In 2000, the $17,979 of "All Other Compensation" Mr. Giordani received consisted of the following: executive medical ($14,067) and life insurance ($3,912). OPTION GRANT INFORMATION No options to purchase shares of common stock were granted to the Named Executive Officers in 2000. AGGREGATED OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUES The following table sets forth information regarding (i) stock option exercises by the Named Executive Officers during 2000 and (ii) unexercised stock options held by the Named Executive Officers at December 31, 2000:
AGGREGATED OPTION EXERCISES IN 2000 AND DECEMBER 31, 2000 OPTION VALUES Number of Unexercised Securities Underlying Value of Unexercised Options at December 31, In-the-Money Options Shares 2000 at December 31, 2000(2) Acquired Value ---------------------------- ---------------------------- Name on Exercise Realized(1) Exercisable Unexercisable Exercisable Unexercisable ---- ----------- ------------ ----------- ------------- ----------- ------------- Milan Panic.................. -- $ -- 2,346,092 75,000 $ 33,050,219 $ 285,938 Adam Jerney.................. 262,808 4,309,563 836,135 75,400 16,220,424 560,662 Richard A. Meier............. 18,250 372,984 69,250 162,500 905,750 1,998,906 Bill MacDonald............... 30,000 582,423 25,500 45,000 11,462 85,781 John E. Giordani............. 56,376 910,069 58,606 45,000 498,468 85,781 - ------------------------------------------------------------------------------------------------------------------------------
(1) Difference between the fair market value of the shares of common stock at the date of exercise and the exercise price. (2) Difference between the fair market value of the shares of common stock on December 31, 2000 and the exercise price. COMPENSATION OF DIRECTORS OF ICN Members of the Board of Directors of ICN, other than employees, were paid an annual fee of $30,000, payable quarterly, plus a fee of $1,000 for every Board meeting attended and an additional fee of $1,000 for every committee meeting attended, and were reimbursed for their out-of-pocket expenses in attending meetings. In addition, non-employee directors on each April 18th are granted options to purchase 15,000 shares. COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION The Compensation and Benefits Committee ("Committee") is composed of Messrs. Barker, Charles, and Moses and Dr. Smith each of whom is a non-employee director for purposes of Rule 16b-3 of the Exchange Act. CERTAIN EMPLOYMENT AGREEMENTS On March 18, 1993, the Board of Directors of ICN adopted employment agreements which contained "Change in Control" benefits for five then current key senior executive officers of ICN and its affiliates. The executives included the following Named Executive Officers: Messrs. Jerney, Giordani and MacDonald. In addition, the Company entered into an employment agreement with Richard A. Meier, Executive Vice President and Chief Financial Officer, on December 31, 1998, containing identical provisions to the agreements with Messrs. Jerney, Giordani and MacDonald (collectively the "Employment Agreements"). The Employment Agreements are intended to retain the services of these executives and provide for continuity of management in the event of any actual or threatened Change in Control. Each Employment Agreement with Messrs. Jerney, Giordani and MacDonald had an initial term which ended March 30, 1996. The Employment Agreement with Mr. Meier had an initial term extending through December 31, 2000. The Employment Agreements automatically extend for one year terms each year thereafter unless either the executive or ICN elects not to extend it (provided that any notice by ICN not to extend the agreement cannot cause the agreement to be terminated prior to the expiration of the third anniversary of the date of the Employment Agreements). These Employment Agreements provide that each executive shall receive severance benefits equal to three times salary and bonus (and certain other benefits) if the executive's employment is terminated without cause, if the executive terminates employment for certain enumerated reasons following a Change in Control of ICN (including a significant reduction in the executive's compensation, duties, title or reporting responsibilities or a change in the executive's job location), or the executive leaves ICN for any reason or without reason during a sixty day period commencing six months after the Change in Control. The executive is under no obligation to mitigate amounts payable under the Employment Agreements. For purposes of the Employment Agreements, a "Change in Control" means any of the following events: (i) the acquisition (other than from ICN) by any person, subject to certain exceptions, of beneficial ownership, directly or indirectly, of 20% or more of the combined voting power of ICN's then outstanding voting securities; (ii) the existing Board of Directors cease for any reason to constitute at least two-thirds of the Board, unless the election, or nomination for election by ICN's stockholders, of any new director was approved by a vote of at least two-thirds of the existing Board of Directors; or (iii) approval by stockholders of ICN of (a) a merger or consolidation involving ICN if the stockholders of ICN, immediately before such merger or consolidation, do not, as a result of such merger or consolidation, own, directly or indirectly, more than 80% of the combined voting power of the then outstanding voting securities of the corporation resulting from such merger or consolidation in substantially the same proportion as their ownership of the combined voting power of the voting securities of ICN outstanding immediately before such merger or consolidation, or (b) a complete liquidation or dissolution of ICN or an agreement for the sale or other disposition of all or substantially all of the assets of ICN. Removal of ICN's Board of Directors would also constitute a Change in Control under the Employment Agreements. If the employment of such key senior executives is terminated under any of the circumstances described above the executives would be entitled to receive the following approximate amounts (based upon present compensation): Adam Jerney $2,707,716; John Giordani $2,231,700; Bill MacDonald $1,945,700; and Richard A. Meier $1,815,000. In addition, the vesting of certain options granted to the executives would be accelerated. The value of the accelerated options would depend upon the market price of the shares of Common Stock at that time. CHAIRMAN EMPLOYMENT AGREEMENT ICN and Milan Panic entered into an employment agreement initially effective October 1, 1988, which has been amended and extended from time to time (the "Panic Employment Agreement"). The Panic Employment Agreement provides for automatic renewal on the first day of each month, such that the employment period is four years from the date of such renewal unless, at least 60 days prior to any such renewal date, ICN or Mr. Panic give notice to the other that the employment period will not so be extended. The base amount of salary for Mr. Panic was initially determined by the Compensation Committee of the Board of Directors of ICN in 1988. In setting the base amount, the Compensation Committee took into consideration Mr. Panic's then-current base salary, the base salaries of chief executives of companies of similar scope and complexity and the Compensation Committee's desire to retain Mr. Panic's services, given his role as founder of ICN. The Panic Employment Agreement provides that the annual salary, currently $802,892, is to be increased by an amount equal to not less than 7% annually. No increase would be paid, however, if in the previous fiscal year ICN's earnings per share, as certified by ICN's independent accountants, either (i) decrease by an amount equal to or greater than fifty percent (50%) of the annual earnings per share earned in the preceding fiscal year or (ii) reveal a loss, unless otherwise determined by the Board of Directors. The Panic Employment Agreement provides that during the period of his employment, Mr. Panic will not engage in businesses competitive with ICN without the approval of the Board of Directors. Mr. Panic may retire upon expiration of the term of the Panic Employment Agreement. Upon retirement, Mr. Panic may, at his option, serve as a consultant to ICN for life for which he would be compensated at the rate of $120,000 per year. This amount is subject to annual cost-of-living adjustments from the base year of 1967 until the date of retirement (currently estimated to be in excess of $577,000 per year, as adjusted). The consulting fee shall not at any time exceed the highest annual compensation, as adjusted, paid to Mr. Panic during his employment by ICN. Upon Mr. Panic's retirement, the consulting fee shall not be subject to further cost-of-living adjustments. The Panic Employment Agreement includes a severance compensation provision in the event of a Change in Control of ICN (as defined below). The Panic Employment Agreement provides that if within two years after a Change in Control of ICN, Mr. Panic's employment is terminated by ICN (other than by reason of Mr. Panic's illness or incapacity), or if Mr. Panic leaves the employ of ICN (other than by reason of Mr. Panic's death, disability, or illness), then Mr. Panic will receive as severance compensation five times his annual salary, as adjusted, but only to the extent that ICN determines that such amount will not constitute a "parachute payment" as defined in Section 280G of the Internal Revenue Code, and Mr. Panic will be deemed to have retired and will receive the same consulting fees to which he would otherwise have been entitled under the Panic Employment Agreement. In addition, (i) Mr. Panic will be entitled to continue life insurance, disability, medical, dental and hospitalization coverage, (ii) all restrictions on outstanding awards granted to Mr. Panic will lapse, and all stock options and stock appreciation rights granted to Mr. Panic will become fully vested and exercisable, and (iii) Mr. Panic will also be entitled to receive a cash payment equal to the excess of the actuarial equivalent of his aggregate retirement benefits had he remained employed by ICN for an additional three years over the actuarial equivalent of his actual aggregate retirement benefit. A Change in Control of ICN will occur, for purposes of the Panic Employment Agreement, if (i) a Change in Control occurs of a nature which would be required to be reported in response to Item 6(e) of Schedule 14A under the Exchange Act (for purposes of that Item, "control" is defined as the power to direct or cause the direction of the management and policies of ICN, whether through the ownership of voting securities, by contract, or otherwise) unless two-thirds of the Existing Board of Directors, as defined below, decide in their discretion that no Change in Control has occurred for purposes of the agreement; (ii) any person is or becomes the beneficial owner, directly or indirectly, of securities of ICN representing 15% or more of the combined voting power of ICN's then outstanding securities; (iii) the persons constituting the Existing Board of Directors, as defined below, cease for any reason to constitute a majority of ICN's Board of Directors; or (iv) shares of ICN common stock cease to be registered under the Exchange Act. "Existing Board of Directors" is defined in the Panic Employment Agreement as those persons constituting the Board of Directors at the date of the Panic Employment Agreement, together with each new director whose election or nomination for election by ICN's stockholders was previously approved, or is approved within thirty days after such election or nomination, by a vote of at least two-thirds of the directors in office prior to such person's election as a director. If Mr. Panic's employment is terminated under any of the circumstances described above following such a Change in Control, in addition to the consulting fee as described above, Mr. Panic would be entitled to receive (based upon present compensation) $10,431,830. 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT Principal Stockholders As of March 31, 2001, no person is known to management to be beneficial owners of more than 5% of the outstanding shares of the Common Stock. Ownership by Management The following table sets forth, as of April 23, 2001, certain information regarding the beneficial ownership of the Common Stock and the percent of shares owned beneficially by each director, each director nominee nominated by the Board of Directors and each Named Executive Officer (as defined below) and all directors and executive officers of the Company as a group:
Number of Shares and Nature of Beneficial Ownership of ICN Percentage Identity of Owner or Group Common Stock(1) of Class -------------------------- --------------- ----------- Norman Barker, Jr............................................ 146,819(3) (2) Birch E. Bayh, Jr............................................ 97,266(4) (2) Kim Campbell, PC, QC......................................... -- (2) Alan F. Charles.............................................. 100,547(5) (2) Roger Guillemin, M.D., Ph.D.................................. 160,509(6) (2) Ray Irani, Ph.D.............................................. -- (2) Adam Jerney.................................................. 1,169,605(7) 1.5% Andrei Kozyrev............................................... 40,625(8) (2) Jean-Francois Kurz........................................... 127,716(9) (2) Thomas H. Lenagh............................................. 136,117(10) (2) Charles T. Manatt............................................ 36,787(11) (2) Stephen D. Moses............................................. 84,808(12) (2) Milan Panic.................................................. 2,690,180(13) 3.3% Roberts A. Smith, Ph.D....................................... 215,733(14) (2) Rosemary Tomich.............................................. -- (2) Richard A. Meier............................................. 80,250(15) (2) John E. Giordani............................................. 80,218(16) (2) Bill A. MacDonald............................................ 50,044(17) (2) James G. McCoy............................................... -- (2) Johnson Y.N. Lau, M.D., Ph.D................................. 18,750(18) (2) Jack Scholl.................................................. 152,250(19) (2) David Watt................................................... 193,140(20) (2) Directors and executive officers of the Company as a group (22 persons).................................... 5,581,364(21) 7%
(1) Except as indicated otherwise in the following notes, shares shown as beneficially owned are those as to which the named persons possess sole voting and investment power. However, under the laws of California and certain other states, personal property owned by a married person may be community property which either spouse may manage and control, and the Company has no information as to whether any shares shown in this table are subject to community property laws. (2) Less than 1%. (3) Includes 141,690 shares of ICN common stock which Mr. Barker has the right to acquire within 60 days upon the exercise of stock options. (4) Includes 97,266 shares of ICN common stock which Sen. Bayh has the right to acquire within 60 days upon the exercise of stock options. (5) Includes 100,478 shares of ICN common stock which Mr. Charles has the right to acquire within 60 days upon the exercise of stock options. (6) Includes 159,681 shares of ICN common stock which Dr. Guillemin has the right to acquire within 60 days upon the exercise of stock options. (7) Includes 735,498 shares of ICN common stock which Mr. Jerney has the right to acquire within 60 days upon the exercise of stock options. (8) Includes 40,625 shares of ICN common stock which Mr. Kozyrev has the right to acquire within 60 days upon the exercise of stock options. (9) Includes 127,716 shares of ICN common stock which Mr. Kurz has the right to acquire within 60 days upon the exercise of stock options. (10) Includes 124,528 shares of ICN common stock which Mr. Lenagh has the right to acquire within 60 days upon the exercise of stock options. (11) Includes 33,750 shares of ICN common stock which Mr. Manatt has the right to acquire within 60 days upon the exercise of stock options. (12) Includes 84,505 shares of ICN common stock which Mr. Moses has the right to acquire within 60 days upon the exercise of stock options. (13) Includes 2,034,946 shares of ICN common stock which Mr. Panic has the right to acquire within 60 days upon the exercise of stock options. (14) Includes 192,162 shares of ICN common stock which Dr. Smith has the right to acquire within 60 days upon the exercise of stock options. (15) Includes 76,750 shares of ICN common stock which Mr. Meier has the right to acquire within 60 days upon the exercise of stock options. (16) Includes 77,356 shares of ICN common stock which Mr. Giordani has the right to acquire within 60 days upon the exercise of stock options. (17) Includes 44,250 shares of ICN common stock which Mr. MacDonald has the right to acquire within 60 days upon the exercise of stock options. (18) Includes 18,750 shares of ICN common stock which Dr. Lau has the right to acquire within 60 days upon the exercise of stock options. (19) Includes 138,682 shares of ICN common stock which Mr. Sholl has the right to acquire within 60 days upon the exercise of stock options. (20) Includes 188,204 shares of ICN common stock which Mr. Watt has the right to acquire within 60 days upon the exercise of stock options. (21) Includes 4,416,837 shares of ICN common stock which directors and executive officers have the right to acquire within 60 days upon the exercise of stock options. 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS In June 1996, the Company made a short-term loan to the Chairman and CEO in the amount of $3,500,000 for obligations arising from the settlement of a litigation to which the Chairman and CEO and the Company were parties. During August 1996, this amount was repaid to the Company. In connection with this transaction, the Company guaranteed $3,600,000 of demand debt of the Chairman with a third party bank, which is renewable by the Chairman annually until repaid. In addition to the guarantee, the Company deposited $3,600,000 with this bank as collateral to the Chairman's debt, which will remain in place until such time as the Chairman repays his obligation to the bank. This deposit is recorded as a long-term asset on the Company's consolidated balance sheet. The Company is not aware of the time frame in which the Chairman expects to repay this obligation. Interest paid by the Company on behalf of the Chairman was charged to the Chairman as compensation expense and amounted to $160,916, $163,166 and $181,901 for the three years ended December 31, 2000, 1999 and 1998, respectively. The Company recognized interest income on the deposit of $124,330, $126,097 and $134,151 for the three years ended December 31, 2000, 1999 and 1998, respectively. The Chairman has provided collateral to the Company's guarantee in the form of a right to the proceeds of the exercise of options to acquire 150,000 shares with an exercise price of $15.17 and the rights to a $4,000,000 life insurance policy provided by the Company. In the event of any default on the debt to the bank, the Company has recourse that is limited to the collateral described above. Both the transaction and the sufficiency of the collateral for the guarantee were approved by the Board of Directors. In January 2001, the Company made a non-recourse loan to Mr. Adam Jerney, Chief Operating Officer and President of the Company, of $1,197,864.38 as part of a program adopted by the Board of Directors of the Company to encourage directors and officers of the Company to exercise stock options (the "Stock Option Program"). The loan is secured by 148,537 shares of the Company's Common Stock. In April 2001, the Company made a non-recourse loan to Mr. Milan Panic, Chairman of the Board and Chief Executive Officer of the Company, of $2,734,387.19 as part of the Stock Option Program. The loan is secured by 286,879 shares of the Company's Common Stock. These loans bear interest at a rate of 5.61% per annum, compounded annually, and interest is repaid at the time of principal repayment. Dr. Roberts A. Smith, a director of the Company, received $30,000 in 2000 from the Company for consulting services rendered. Dr. Roger Guillemin, a director of the Company, received $39,375 in 2000 from the Company for consulting services rendered. Oppenheimer, Wolff & Donnelly LLP, a law firm with which Senator Bayh is affiliated, received legal fees from the Company of approximately $66,500 in 2000. PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K (a) 1. Financial Statements Financial Statements of the Registrant are listed in the index to Consolidated Financial Statements and filed under Item 8, "Financial Statements and Supplementary Data", included elsewhere in this Form 10-K. 2. Financial Statement Schedule Financial Statement Schedule of the Registrant is listed in the index to Consolidated Financial Statements and filed under Item 8, "Financial Statements and Supplementary Data," included elsewhere in this Form 10-K. 3. Exhibits EXHIBIT NUMBER DESCRIPTION 3.1 Amended and Restated Certificate of Incorporation of Registrant, previously filed as Exhibit 3.1 to Registration Statement 33-84534 on Form S-4, which is incorporated herein by reference, as amended by the Certificate of Merger, dated November 10, 1994, of ICN Pharmaceuticals, Inc., SPI Pharmaceuticals, Inc. and Viratek, Inc. with and into ICN Merger Corp. previously filed as Exhibit 4.1 to Registration Statement No. 333-08179 on Form S-3, which is incorporated herein by reference. 3.3 Amended and Restated By-Laws of the Registrant filed herewith. 3.4 Form of Rights Agreement, dated as of November 2, 1994, between the Registrant and American Stock Transfer & Trust Company, as trustee, previously filed as Exhibit 4.3 to the Company's Registration Statement on Form 8-A, dated November 10, 1994, which is incorporated herein by reference. 4.1 Agreement between ICN Pharmaceuticals, Inc. and Relational Investors LLC, dated October 19, 2000. 4.2 Agreement between Special Situations Partners, Inc. and ICN Pharmaceuticals, Inc., dated october 19, 2000. 10.1 Indenture, dated as of August 14, 1997, by and among ICN and United States Trust Company of New York, relating to $275,000,000 9 1/4% Senior Notes due 2005, previously filed as Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1997, which is incorporated herein by reference.* 10.2 Indenture, dated as of August 20, 1998, by and among ICN and United States Trust Company of New York, relating to $200,000,000 8 3/4% Senior Notes due 2008, previously filed as Exhibit 4.2 to the Company's Registration Statement No. 333-63721 on Form S-4, which is incorporated herein by reference.* 10.3 Registration Rights Agreement, dated as of August 20, 1998, by and among ICN and Schroder & Co. Inc., previously filed as Exhibit 4.3 to the Company's Registration Statement No. 333-63721 on Form S-4, which is incorporated herein by reference. 10.4 Application for Registration, Foundation Agreement, Joint Venture -- ICN Oktyabr previously filed as Exhibit 10.46 to ICN Pharmaceuticals, Inc. Annual Report on Form 10-K for the year ended December 31, 1992, which is incorporated herein by reference. 10.5 Charter of the Joint Stock Company -- ICN Oktyabr previously filed as Exhibit 10.47 to ICN Pharmaceuticals, Inc.'s Annual Report on Form 10-K for the year ended December 31, 1992, which is incorporated herein by reference. 10.6+ Agreement between ICN Pharmaceuticals, Inc. and Milan Panic, dated October 1, 1988 previously filed as Exhibit 10.51 to ICN Pharmaceuticals, Inc.'s Annual Report on Form 10-K for the year ended November 30, 1989, which is incorporated herein by reference. 10.7 Amendment to Employment Contract between ICN Pharmaceuticals, Inc., and Milan Panic, dated September 6, 1995 previously filed as Exhibit 10.29 to ICN Pharmaceuticals, Inc.'s Annual Report on Form 10-K for the year ended December 31, 1995, which is incorporated herein by reference. 10.8+ Amendment to Employment Contract between ICN Pharmaceuticals, Inc., and Milan Panic dated January 1, 1999 filed herewith. 10.9+ Agreement among ICN Pharmaceuticals, Inc., SPI Pharmaceuticals, Inc. and Adam Jerney, dated March 18, 1993 previously filed as Exhibit 10.49 to SPI Pharmaceuticals, Inc.'s Amendment No. 2 to the Annual Report on Form 10-K for the year ended on December 31, 1992, which is incorporated herein by reference. 10.10+ Agreement among ICN Pharmaceuticals, Inc., Viratek, Inc. and John Giordani, dated March 18, 1993 previously filed as Exhibit 10.3 to Registration Statement No. 33-84534 on Form S-4 dated September 28, 1994, which is incorporated herein by reference. 10.11+ Agreement among ICN Pharmaceuticals, Inc., ICN Biomedicals, Inc., SPI Pharmaceuticals, Inc. and Bill MacDonald, dated March 18, 1993 previously filed as Exhibit 10.4 to Registration Statement No. 33-84534 on Form S-4 dated September 28, 1994, which is incorporated herein by reference. 10.12+ Agreement among ICN Pharmaceuticals, Inc., SPI Pharmaceuticals, Inc. and Jack Sholl dated March 18, 1993, previously filed as Exhibit 10.49 to SPI Pharmaceuticals, Inc.'s Amendment No. 2 to the Annual Report on Form 10-K for the year ended December 31, 1992, which is incorporated herein by reference. 10.14 Agreement between ICN Pharmaceuticals, Inc. and Benjamin Lap dated April 1, 1999, previously filed as Exhibit 10.14 for the Registrant's Form 10-K for the year ended December 31, 1999, which is incorporated herein by reference. 10.15 Agreement among ICN Pharmaceuticals, Inc., SPI Pharmaceuticals, Inc. and David Watt dated March 18, 1993, previously filed as Exhibit 10.49 to SPI Pharmaceuticals, Inc.'s Amendment No. 2 to the Annual Report on Form 10-K for the year ended December 31, 1992, which is incorporated herein by reference. 10.16 Agreement between ICN Pharmaceuticals, Inc. and Richard A. Meier dated December 31, 1998, previously filed as Exhibit 10.16 to the Registrant's Form 10-K for the year ended December 31, 1998, which is incorporated herein by reference. 10.17 ICN Pharmaceuticals, Inc. 1992 Employee Incentive Stock Option Plan, previously filed as Exhibit 10.56 to ICN Pharmaceuticals, Inc.'s Form 10-K for the year ended December 31, 1992, which is incorporated herein by reference. 10.18 ICN Pharmaceuticals, Inc. 1992 Non-Qualified Stock Plan, previously filed as Exhibit 10.57 to ICN Pharmaceuticals, Inc.'s Annual Report on Form 10-K for the year ended December 31, 1992, which is incorporated herein by reference. 10.19 ICN Pharmaceuticals, Inc. 1994 Stock Option Plan, previously filed as Exhibit 10.30 to the Registrant's Form 10-K for the year ended December 31, 1995, which is incorporated herein by reference. 10.20 ICN Pharmaceuticals, Inc. 1998 Stock Option Plan, previously filed as Exhibit 10.20 to the Registrant's Form 10-K for the year ended December 31, 1998, which is incorporated herein by reference. 10.21 Exclusive License and Supply Agreement between ICN Pharmaceuticals, Inc. and Schering-Plough Ltd. dated July 28, 1995 previously filed as Exhibit 10 to ICN Pharmaceuticals, Inc.'s Amendment 3 to the Quarterly Report on Form 10-Q for the quarter ended September 30, 1996, which is incorporated herein by reference. 10.22 Collateral Agreement between Milan Panic and the Registrant, dated August 14, 1996, previously filed as Exhibit 10.32 to ICN Pharmaceuticals, Inc.'s Annual Report on Form 10-K for the year ended December 31, 1996, which is incorporated herein by reference. 10.24 Form of Asset Purchase Agreement by and between Hoffman-La Roche Inc., a New Jersey corporation, and ICN Pharmaceuticals, Inc., a Delaware corporation, dated as of October 30, 1997, previously filed as Exhibit 10.1 to ICN Pharmaceuticals, Inc.'s Quarterly Report on Form 10-Q for the quarter ended September 30, 1997, which is incorporated herein by reference. 10.25 Form of Asset Purchase Agreement by and between Roche Products Inc., a Panamanian corporation, and ICN Pharmaceuticals, Inc., a Delaware corporation, dated as of October 30, 1997, previously filed as Exhibit 10.2 to ICN Pharmaceuticals, Inc.'s Quarterly Report on Form 10-Q for the quarter ended September 30, 1997, which is incorporated herein by reference. 10.26 Form of Asset Purchase Agreement by and between Syntex (F.P.) Inc., a Delaware corporation, Syntex (U.S.A.), a Delaware corporation, and ICN Pharmaceuticals, Inc., a Delaware corporation, dated as of October 30, 1997, previously filed as Exhibit 10.3 to ICN Pharmaceuticals, Inc.'s Quarterly Report on Form 10-Q for the quarter ended September 30, 1997, which is incorporated herein by reference. 10.27 Agreement for the Sale and Purchase of a Portfolio of Pharmaceutical, OTC and Consumer Healthcare Products between SmithKline Beecham plc and ICN Pharmaceuticals, Inc., previously filed as Exhibit 10.22 to ICN Pharmaceuticals, Inc.'s Annual Report on Form 10-K for the year ended December 31, 1997, which is incorporated herein by reference. 10.28 Asset Purchase Agreement dated October 2, 1998 by and between F. Hoffmann-LaRoche Ltd. and ICN Puerto Rico, Inc., previously filed as Exhibit 10.1 to ICN Pharmaceuticals, Inc.'s Quarterly Report on Form 10-Q for the quarter ended September 30, 1998, which is incorporated herein by reference. 10.31 ICN Pharmaceuticals, Inc. Executive Long Term Incentive Plan, previously filed as Exhibit 10.1 to ICN Pharmaceuticals, Inc.'s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1998, which is incorporated herein by reference. 10.32 Amendment to Exclusive License and Supply Agreement between ICN Pharmaceuticals, Inc. and Schering-Plough Ltd. filed herewith. Portions of this exhibit have been omitted pursuant to an application for confidential treatment pursuant to Rule 406 under the Securities Act of 1933, as amended. 10.33 Amendment to Exclusive License and Supply Agreement between ICN Pharmaceuticals, Inc. and Schering-Plough Ltd. Dated July 16, 1998 filed herewith. Portions of this exhibit have been omitted pursuant to an application for confidential treatment pursuant to Rule 406 under the Securities Act of 1933, as amended. 10.34 Agreement among Schering Corporation, ICN Pharmaceuticals, Inc. and Ribapharm Inc. dated as of November 14, 2000 filed herewith. Portions of this exhibit have been omitted pursuant to an application for confidential treatment pursuant to Rule 406 under the Securities Act of 1933, as amended. 10.35+ Amendment to the Employment Agreement between ICN Pharmaceuticals, Inc. and Richard A. Meier dated April 14, 2000, filed herewith. 10.36 Agreement between ICN Pharmaceuticals, Inc. and Johnson Yiu-Nam Lau, dated February 24, 2000, filed herewith. 10.37+ Agreement between ICN Pharmaceuticals, Inc. and James McCoy, dated July 14, 2000, filed herewith. 10.38+ Agreement between ICN Pharmaceuticals, Inc. and Harry Roosje, dated September 15, 2000, filed herewith. 10.39+ Agreement between ICN Pharmaceuticals, Inc. and Clifford Saffron, dated January 18, 2001, filed herewith. 21. Subsidiaries of the Registrant. 23. Consent of PricewaterhouseCoopers LLP, independent accountants. - --------------- * None of the other indebtedness of the Registrant exceeds 10% of its total consolidated assets. The Registrant will furnish copies of the instruments relating to such other indebtedness upon request. + Management Compensation. (b) Reports on Form 8-K The Company filed no reports on Form 8-K during the quarter ended December 31, 2000. SIGNATURES Pursuant to the requirements of Section 13 or 15(d) 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. ICN PHARMACEUTICALS, INC. Date: April 30, 2001 By /s/ David C. Watt -------------------------------- David C. Watt Executive Vice President, General Counsel and Corporate Secretary EXHIBIT INDEX 4.1 Agreement between ICN Pharmaceuticals, Inc. and Relational Investors LLC. 4.2 Agreement between Special Situations Partners, Inc. and ICN Pharmaceuticals, Inc. EX-4.1 2 exh1.txt EXHIBIT 4.1 Exhibit 4.1 AGREEMENT dated as of October 19, 2000 (this "Agreement") among ICN PHARMACEUTICALS, INC., a Delaware corporation (the "Company"), and RELATIONAL INVESTORS, L.L.C., a Delaware limited liability company ("RILLC"), on behalf of itself and each of its affiliates (as such terms are defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended) (RILLC and its affiliates are hereinafter referred to as the "Shareholders"). The Shareholders have submitted to the Company a letter, dated October 19, 2000 (the "Nomination Notice"), proposing five nominees to stand for election to the Company's Board of Directors (the "Board") at the 2000 Annual Meeting of Stockholders of the Company (the "2000 Annual Meeting"). David H. Batchelder has submitted to the Company a letter dated October 19, 2000 (the "Resignation Letter"), resigning as a Director of the Company effective immediately. The Shareholders and the Company are entering into this Agreement to define the future relationship between the Shareholders and the Company in consideration of the mutual covenants contained herein. Accordingly, it is hereby agreed as follows: SECTION 1. Withdrawal of Nomination Notice. The Shareholders will withdraw the Nomination Notice and the Shareholders will have waived any right to submit a new Nomination Notice in connection with the 2000 Annual meeting. Mr. Batchelder will revoke the Resignation Letter and the Company will accept such revocation, and hereby reinstating Mr. Batchelder as a Director of the Company. SECTION 2. Board Representation. Mr. Batchelder will resign from the Company's Board of Directors within five (5) days of the Company's request if such request is made prior to the 2000 Annual Meeting. If Mr. Batchelder resigns as a Director prior to the 2000 Annual Meeting, voluntarily or otherwise, and the Shareholders subsequently determine, in their sole discretion, that the Company has not made sufficient progress in executing its restructuring, then within 60 to 90 days prior to the 2001 Annual Meeting of Stockholders of the Company, the Shareholders may request and, if requested the Company will cause a nominee designated by the Shareholders to be appointed to, as well as nominated for election to, the Company's Board of Directors in the class of directors with a term expiring at the annual meeting of the Company's shareholders to be held in 2004, and if nominee is not elected as a director at the annual meeting of the Company's shareholders to be held in 2001, then the Company will promptly after such meeting cause such nominee to be appointed to the Company's Board of Directors. Within ten (10) days following execution of the Agreement, the Company will pay to the Shareholders all directors fees Including stock options due Mr. Batchelder for his service as a Director of the Company. Such stock options will permit the exercise thereof for a period of at least thirty (30) days following Mr. Batchelder's resignation as a Director. SECTION 3. Specific Performance. The Shareholders and the Company agree that the parties would not have an adequate remedy at law for money damages and that money damages would be incalculable if any of the covenants or agreements in this Agreement were not performed in accordance with its terms and therefore further agree that the parties shall be entitled to specific enforcement of such covenants or agreements and to injunctive and other equitable relief in addition to any other remedy to which they may be entitled at law or in equity. No delay or failure by any party hereto in exercising any right, power or privilege hereunder will operate as a waiver hereof, nor will any single or partial exercise thereof preclude any other or further exercise of any right, or privilege hereunder. SECTION 4. Entire Agreement. This Agreement (i) constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all other prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof, including the Agreement dated as of August 18, 1999, and is not intended to confer upon any person other than the parties hereto any rights or remedies hereunder and (ii) shall not be assigned by operation of law or otherwise without the prior written consent of the other parties. Any attempted assignment or transfer in violation of this Section 4 shall be void and of not effect. Subject to the foregoing, this Agreement shall be binding upon the successors and assigns of the Shareholders and any person controlled by any of the Shareholders or such successors and assigns. RILLC agrees to cause its affiliates, including any managing member of RILLC, to comply with the obligations hereunder. SECTION 5. Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect, unless such action would substantially impair the benefits to any party of the remaining provisions of this Agreement. The parties shall endeavor in good faith negotiations to replace any invalid, void or unenforceable provision with a valid and enforceable provision the effects of which come as close as possible to those of such invalid, void or unenforceable provision. SECTION 6. Notices. Any notices and other communications required to be given pursuant to this Agreement shall be delivered by hand, by registered or certified mail, postage prepaid, return receipt requested, by private courier, by facsimile or by telex, as follows: If to the Company: ICN Pharmaceuticals, Inc. 3300 Hyland Avenue Costa Mesa, California 92626 Attn: Executive Vice President and General Counsel Telecopier: (714) 641-7206 If so she Shareholders: c/o Relational Investors, LLC 11975 El Camino Real, Suite 300 San Diego, California 92130 Attention: Ralph V. Whitworth Telecopier:(858) 704-3333 SECTION 7. Term. This Agreement will terminate on the date of the Annual Meeting of the Company's shareholders to be held in 2002. SECTION 8. Governing Law; Jurisdiciton; etc. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to any applicable conflicts of law principles of such State. Each of the parties irrevocably submits to the exclusive jurisdiction and service and venue in any federal or state court sitting in the State of Delaware for the purposes of any action, suit or proceeding relating to this Agreement. Each of the parties irrevocably and unconditionally waives any objection to the laying of venue of any action, suit or proceeding relating to this Agreement in any federal or state court sitting in the State of Delaware, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum. This Agreement may be executed in one or more counterparts, which together will constitute a single agreement. this Agreement may not be amended except by a writing signed by all of the parties. SECTION 9. Further Actions. Subject to the terms and conditions of this Agreement, each of the parties agrees to use all commercially reasonable efforts to take, or cause to be taken, all action necessary, proper or advisable to consummate and make effective the transactions contemplated by this Agreement. IN WITNESS WHEREOF, the Company and RILLC have caused this Agreement to be duly executed as of the day and year first above written. ICN PHARMACEUTICALS. INC. By: /s/ David C. Watt ---------------------------------- David C. Watt Executive Vice President and General Counsel RELATIONAL INVESTORS, LLC. By: /s/ David H. Batchelder ---------------------------------- David H. Batchelder Managing Member EX-4.2 3 exh2.txt EXHIBIT 4.2 Exhibit 4.2 [LETTERHEAD OF SSP-SPECIAL SITUATIONS PARTNERS INC.] October 19, 2000 ICN Pharmaceuticals, Inc. 3300 Hyland Avenue Costa Mesa, California 92626 Dear Sirs: The purpose of this letter is to set forth the following agreements and understandings between ICN Pharmaceuticals, Inc. (the "Company") and SSP-Special Situations Partners Inc. ("SSP"). Section 1. Press Release. Concurrent with the execution of this Letter Agreement, the Company has issued a press release in the form attached hereto as Annex A (the "Press Release"). The Company shall not (and shall cause its officers, directors, agents and advisors not to) make any public statement in connection with this Letter Agreement or the matters addressed in the Press Release that is inconsistent with the Press Release. Section 2. Annual Meetings of Shareholders. As a means for SSP and the stockholders of the Company to enforce the commitments of the Company set forth in the Press Release, the Company agrees that: (i) The board of directors of the Company (the "Board") and the Company shall take all steps necessary or desirable to hold the 2001 annual meeting of stockholders of the Company by not later than May 30, 2001 (the "2001 Meeting") and the 2002 annual meeting of stockholders of the Company not later than May 29, 2002 (the "2002 Meeting"), and shall not seek to postpone or adjourn, or permit the postponement or adjournment, of either the 2001 Meeting or the 2002 Meeting. (ii) The Board and the Company shall by not later than the 2002 Meeting, in accordance with applicable law, cause the size of the Board to be reduced to, and fixed at nine directors, divided into three classes of three directors. Such reduction shall be accomplished by reducing to three the number of directors to be elected at each annual meeting of stockholders of the Company (together with a concomitant reduction in the size of the entire Board) beginning, seriatim, with the 2000 annual meeting of stockholders of the Company (the "2000 Meeting"). (iii) The Board and the Company shall take all steps necessary or desirable to procure that at each of the 2000 Meeting, the 2001 Meeting and the 2002 Meeting, the stockholders are entitled to elect exactly three directors and that the number of directors to be elected at the 2002 Meeting, when taken together with the number of directors elected at the 2001 Meeting, shall in no event constitute less than two-thirds of the entire Board at the date of the 2002 Meeting. (iv) The Company shall not (and shall cause its officers, directors, agents and advisors not to) take any action (including increasing the size of the Board or proposing any amendments to its Restated Certificate of Incorporation or By-laws) that would impede or prevent (A) the Company from complying fully with the terms of this Letter Agreement or (B) any person who has complied with the Company's Restated Certificate of Incorporation and any other applicable law from making any shareholder proposals or nominations at, or from soliciting proxies in respect of, the 2001 Meeting or the 2002 Meeting. (v) The Board shall, as soon as possible but by not later than October 24, 2000, duly adopt, in accordance with the charter documents of the Company and in accordance with the Delaware General Corporation law, an amendment to the Company's By-laws in the form attached hereto as Annex B. Section 3. SSP Covenant. SSP hereby covenants and agrees that it will not, and will cause each of its affiliates not to, nominate or propose to nominate any person for election at, or bring or propose to bring any matter before, the 2000 annual meeting of stockholders of the Company. Section 4. Representations and Warranties. (a) The Company represents and warrants to SSP that (i) its execution, delivery and performance of this Letter Agreement has been approved by the Board and does not violate its Restated Certificate of Incorporation or Bylaws or any agreement to which it is a party, and (ii) this Letter Agreement constitutes a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms. (b) SSP represents and warrants to the Company that (i) its execution, delivery and performance of this Letter Agreement has been approved by all necessary corporate approvals and does not violate its constituent documents or any agreement to which it is a party, and (ii) this Letter Agreement constitutes a valid and binding obligation of SSP, enforceable against SSP in accordance with its terms. Section 5. Miscellaneous. This Letter Agreement represents the entire understanding of the parties hereto with reference to the subject matter hereof and supersedes any and all other oral or written agreements and understandings among the parties heretofore made. This Letter Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware. Each of the parties hereto shall use such party's best efforts to take such actions as may be necessary or reasonably requested by the other party hereto to carry out and consummate the transactions contemplated by this Letter Agreement. No party to this Letter Agreement directly or indirectly, shall, or shall permit anyone acting on its behalf to challenge the validity or enforceability of any provision of this Letter Agreement or the matters contemplated hereby. The parties hereto agree that irreparable damage may occur in the event that any provision of this Letter Agreement is not performed in accordance with the terms hereof and that the non-breaching party will be entitled (in addition to any other remedy at law or equity) to an injunction or injunctions to prevent breaches of the provisions of this Letter Agreement and to enforce the terms and provisions of this Letter Agreement by a decree of specific performance in any action instituted in any court of the United States or any state thereof having jurisdiction without the necessity of proving the inadequacy of a remedy of money damages. If any term or other provision of this Letter Agreement is invalid, illegal or incapable of being enforced by any rule of law or public policy, all other conditions and provisions of this Letter Agreement shall nevertheless remain in full force and effect. If the terms of this Letter Agreement are in accordance with your understandings and agreements with us, please sign and return the enclosed duplicate of this letter, whereupon this Letter Agreement shall constitute a binding agreement between us. Very truly yours, SSP-SPECTAL SITUATIONS PARTNERS INC. By /s/ Eric Knight ---------------------------------- Accepted and agreed to as of the date first above written: ICN PHARMACEUTICALS, INC. By /s/David C. Watt --------------------------- -----END PRIVACY-ENHANCED MESSAGE-----