SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): NOVEMBER 10, 1996
IVAX CORPORATION
4400 Biscayne Boulevard, Miami, Florida 33137
(305) 575-6000
Incorporated under the laws of the Commission File Number I.R.S. Employer Identification Number
STATE OF FLORIDA 1-09623 16-1003559
ITEM 5. OTHER EVENTS.
GENERAL
On November 10, 1996, IVAX Corporation, a Florida corporation ("IVAX"),
entered into an Agreement and Plan of Merger (the "Agreement") with Bergen
Brunswig Corporation, a New Jersey corporation ("Bergen"), BBI Healthcare
Corporation, a newly-formed Delaware corporation ("BBI"), BBI-I Sub, Inc., a
newly-formed Florida corporation and wholly-owned subsidiary of BBI, and BBI-B
Sub, Inc., a newly-formed New Jersey corporation and wholly-owned subsidiary of
BBI. Under the terms of the Agreement, IVAX and Bergen will each simultaneously
become separate, wholly-owned subsidiaries of BBI pursuant to the merger of
BBI-I Sub, Inc. with and into IVAX (the "IVAX Merger") and the merger of BBI-B
Sub, Inc. with and into Bergen (the "Bergen Merger" and, together with the IVAX
Merger, the "Mergers"), and the IVAX and Bergen shareholders will each receive
shares of the common stock, par value $.01 per share, of BBI (the "BBI Common
Stock"). A copy of the Agreement is included as Exhibit 2 to this Form 8-K and
incorporated herein by reference.
TRANSACTION CONSIDERATION
Pursuant to the IVAX Merger, each outstanding share of common stock,
par value $.10 per share, of IVAX (the "IVAX Common Stock") will be converted at
the effective time of the Mergers into the right to receive 0.42 of a share of
BBI Common Stock. Pursuant to the Bergen Merger, each outstanding share of Class
A Common Stock, par value $1.50 per share, of Bergen (the "Bergen Common Stock")
will be converted at the effective time of the Mergers into the right to receive
1.00 share of BBI Common Stock. After the Mergers, shareholders of IVAX and
Bergen will hold approximately 56 percent and 44 percent, respectively, of BBI
Common Stock.
STOCK EXCHANGE LISTING
Following consummation of the transaction, the BBI Common Stock is
expected to be listed on the New York Stock Exchange (the "NYSE").
BOARD OF DIRECTORS AND MANAGEMENT OF BBI
Following the transaction, the board of directors of BBI will consist
of the President and Chief Executive Officer of BBI and an equal number of
directors selected by each of IVAX and Bergen. Phillip Frost, M.D., currently
the Chairman and Chief Executive Officer of IVAX, and Robert E. Martini,
currently the Chairman and Chief Executive Officer of Bergen, will be the
Co-Chairmen of BBI. Donald R. Roden, currently the President and Chief Executive
Officer-Elect of Bergen, will be the President and Chief Executive Officer of
BBI.
ACCOUNTING TREATMENT
The transaction is expected to be accounted for as a pooling of
interests for financial reporting purposes.
TAX CONSEQUENCES TO IVAX SHAREHOLDERS
The Mergers are expected to qualify as a tax-free reorganization under
Section 368(a) of the Internal Revenue Code. Accordingly, (1) no gain or loss
would be recognized by IVAX, Bergen, BBI-I Sub, Inc., BBI-B Sub, Inc., BBI, the
IVAX shareholders or the Bergen shareholders as a result of the Mergers, (2) the
basis of the BBI Common Stock received by the IVAX shareholders in the IVAX
Merger would be the same as their basis in the IVAX Common Stock converted in
the IVAX Merger and (3) the holding period of the BBI Common Stock received by
IVAX shareholders in the IVAX Merger would include the holding period of the
IVAX Common Stock converted in the IVAX Merger.
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TERMINATION FEE
The Agreement provides that IVAX will pay to Bergen a termination fee
of $50 million if the Agreement is terminated under certain circumstances. In
addition, the Agreement provides that Bergen will pay IVAX a termination fee of
$39 million if the Agreement is terminated under certain circumstances.
OPTION AGREEMENTS
In connection with the Agreement, IVAX entered into a Stock Option
Agreement with Bergen, dated as of November 10, 1996 (the "IVAX Option
Agreement"), pursuant to which IVAX granted Bergen an irrevocable option (the
"IVAX Option") effective as of the close of trading on the American Stock
Exchange (the "AMEX") on November 11, 1996, to purchase up to 30,177,342 shares
of IVAX Common Stock (which would constitute approximately 19.9% of the
outstanding shares of IVAX Common Stock) under certain conditions at an exercise
price per share equal to the closing price of shares of IVAX Common Stock on the
AMEX at the time of grant ($12.375 per share). IVAX agreed to grant the IVAX
Option to Bergen as a condition to Bergen's willingness to enter into the
Agreement. A copy of the IVAX Option Agreement is included as Exhibit 10.1
hereto and is incorporated herein by reference.
Bergen entered into a Stock Option Agreement with IVAX, dated as of
November 10, 1996 (the "Bergen Option Agreement"), pursuant to which Bergen
granted IVAX an irrevocable option (the "IVAX Option"), effective as of the
close of trading on the NYSE, on November 11, 1996, to purchase 9,953,076 shares
of Bergen Common Stock (which would constitute approximately 19.9% of the
outstanding shares of Bergen Common Stock) under certain conditions at an
exercise price per share equal to the closing price of shares of Bergen Common
Stock on the NYSE at the time of grant ($27.625 per share). Bergen agreed to
grant the Bergen Option to IVAX as a condition to IVAX' willingness to enter
into the Agreement. A copy of the Bergen Option Agreement is included as Exhibit
10.2 hereto and is incorporated herein by reference.
VOTING AGREEMENTS
Robert E. Martini and IVAX have entered into a voting agreement, dated
as of November 10, 1996 (the "Bergen Voting Agreement"), pursuant to which Mr.
Martini, the Chairman and Chief Executive Officer of Bergen, has agreed to vote
the shares of Bergen Common Stock owned by him in favor of the Bergen Merger and
the Agreement and against any other competing transaction for a one-year period.
Mr. Martini owns approximately 5.3% of the outstanding shares of Bergen Common
Stock. Bergen, Dr. Phillip Frost and Frost-Nevada Limited Partnership have also
entered into a voting agreement, dated as of November 10, 1996 (the "IVAX Voting
Agreement"), pursuant to which Dr. Frost, the Chairman and Chief Executive
Officer of IVAX, and Frost-Nevada Limited Partnership have agreed to vote all
shares of IVAX Common Stock owned by them in favor of the IVAX Merger and the
Agreement and against any other competing transaction for a one-year period. Dr.
Frost and Frost- Nevada Limited Partnership own together approximately 12.5% of
the outstanding IVAX Common Stock. Copies of the Bergen and IVAX Voting
Agreements are included as Exhibits 10.3 and 10.4 hereto and incorporated herein
by reference.
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CONDITIONS TO CLOSING
The obligation of each party to consummate the transaction will be
subject to the following conditions, among others: (1) the effectiveness of the
registration statement relating to the BBI Common Stock to be issued in the
transaction; (2) the approval of the transaction by the shareholders of Bergen
and the shareholders of IVAX; (3) the receipt of all required governmental
consents and approvals, including the expiration or termination of the waiting
period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended; (4) the receipt of opinions from Arthur Andersen LLP and Deloitte &
Touche LLP that the transaction will be accounted for as a pooling of interests;
(5) the receipt of opinions of counsel as to certain tax matters relating to the
transaction; and (6) the acceptance of BBI Common Stock for listing on the NYSE.
The foregoing descriptions of the Agreement, the Stock Option
Agreements and the Voting Agreements are qualified in their entirety by the full
text of such agreements and documents, copies of which are included as exhibits
to this Current Report on Form 8-K. The Mergers are expected to be consummated
in the first half of 1997. There can be no assurance, however, that the Mergers
will be consummated.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits.
2 Agreement and Plan of Merger, dated as of November 10, 1996,
among BBI, IVAX, Bergen, BBI-I Sub, Inc. and BBI-B Sub.
10.1 Stock Option Agreement, dated as of November 10 1996, between
IVAX and Bergen.
10.2 Stock Option Agreement, dated as of November 10, 1996, between
Bergen and IVAX.
10.3 Voting Agreement, dated as of November 10, 1996, between IVAX
and Robert E. Martini.
10.4 Voting Agreement, dated as of November 10, 1996, between
Bergen, Dr. Phillip Frost and Frost Nevada Limited
Partnership, a Nevada limited partnership.
99 Press Release of IVAX and Bergen relating to the proposed
transaction.
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SIGNATURES
Pursuant to the requirement 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
By:\s\ ARMANDO A. TABERNILLA
--------------------------------
Armando A. Tabernilla
Vice President - Legal Affairs
and General Counsel
Date: November 12, 1996
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