Exhibit 10.13.1

 

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30831 Huntwood Avenue, Hayward, CA 94544

(510) 476-2000 Fax (510) 471-3200

www.impaxlabs.com

March 11, 2011

Mr. Mark Schlossberg

5134 Terramar Way

Oxnard, CA 93035

PROPOSED TERMS OF EMPLOYMENT

(REVISED)

Dear Mark,

This letter sets forth the proposed terms on which we would like you to join
Impax Laboratories, Inc. (“Impax”) as its Senior Vice President and General
Counsel. If the terms are acceptable to you, then we would propose to enter into
a written employment agreement that incorporates the terms described in this
letter, as well as such other terms as you and Impax may agree upon.

The terms we propose for your employment are summarized as follows:

 

  a. As Senior Vice President and General Counsel, you will report to Larry Hsu,
Ph.D., President and Chief Executive Officer;

 

  b. You will be based in our Hayward, California office;

 

  c. You will be entitled to a base salary of $17,307.70 paid biweekly
($450,000.00 annually);

 

  d. You will be eligible to participate in the Impax management bonus program,
under which, for each full calendar year, you would be eligible for a bonus
targeted at 60% of your base salary and potentially up to 90% of your base
salary, in each case depending on the achievement of certain business and
individual objectives and criteria;

 

  e. Your potential bonus for 2011 will be prorated depending on your start
date, but Impax will pay you a one-time cash payment for 2011, concurrent with
the timing of any bonus payments for 2011, in the amount of the difference
between the prorated bonus amount you are entitled to under the Impax management
bonus program and the amount that you would have been entitled to had you been
employed with Impax for the full year of 2011;

 

  f. Subject to Board of Directors approval, Impax will award to you: (i) an
option to purchase 100,000 shares of Impax common stock, and (ii) 30,000
Restricted Stock Units, in each case subject to our normal vesting schedule of
25% per year starting on the first anniversary of the grant, so long as you
remain employed by Impax (these grants are subject to Board of Directors
approval and this proposal is not a intended to create any obligation on the
part of Impax or its Board of Directors — further details on our equity plans
and any specific awards grant to you will be provided following approval of such
awards by our Board of Directors);

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  g. Impax will pay you a one-time hiring bonus of $100,000.00 (less applicable
taxes and other required withholdings) to be paid as soon as administratively
practical following your first day of employment with us;

 

  h. Impax will pay you a relocation allowance of $100,000.00 (which will be
grossed up to account for applicable taxes and other required withholdings),
which may be used toward any and all expenses that you may incur in your move to
the Bay Area, which allowance will be payable as follows: (i) $50,000.00 after
thirty (30) days of employment, and (ii) $50,000.00 on the first payroll date
following your move to the Bay Area as demonstrated by delivery to Impax of
proof of your permanent move to the Bay Area;

 

  i. Pending your acquisition of a permanent residence in the Bay Area, Impax
will reimburse you up to $3,000 per month in temporary living expenses for up to
a period of 12 months following your first day of employment with us; and

 

  j. You will be eligible for benefits in accordance with the applicable Impax
policies for executives, including:

 

  i. medical and dental insurance coverage starting the first of the month
following one month of employment;

 

  ii. group term life, and group long-term and short-term disability insurance
coverage starting the first of the month following three months of employment;

 

  iii. participation in the Impax 401(k) Plan on the first day of the first
calendar quarter following one month of employment;

 

  iv. participation in the Impax Executive Non Qualified Deferred Compensation
Plan;

 

  v. accrual of up to twenty (20) days of Paid Time Off (PTO) that accrue on a
weekly basis (PTO cannot be used until it is earned); and

 

  vi. a one-time allowance of 5 additional days Paid Time Off, if needed, the
week of May 9, 2011.

We anticipate that the definitive written agreement will provide for an initial
term expiring December 31, 2012, subject to termination earlier under certain
circumstances. Such agreement will include Impax’s normal confidentiality,
non-solicitation and non-compete covenants. The definitive written agreement is
also expected to provide that (i) if within one year of your hire date you
terminate your employment with Impax voluntarily without Good Reason or Impax
terminates your employment for Cause (as such terms will be defined therein),
then you will repay Impax 100% of the $100,000 hiring bonus and 100% of
relocation payments that you received, and (ii) if such an event occurs within
the second year after your hire date, then you will repay Impax the second of
the relocation payments that you received.

Our offer will be contingent upon your successful completion of a drug test,
background check and credit check paid by the Company. We will identify a clinic
for drug testing local to you and, if you agree to the proposed terms in this
letter and we move forward with a definitive written agreement, we ask that you
schedule an appointment within 48 hours of your signed acceptance of the
agreement. A positive result will negate our proposal and we will be unable to
extend an offer.

 

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If the terms described in this letter are acceptable to you, then please return
to me a signed copy of this letter by confidential fax at 510-429-2146 by no
later than March 18, 2011. Upon receipt of your signed copy, Impax will begin
preparation of a draft employment agreement for your review. (Until a definitive
written agreement is executed and delivered by you and Impax, you will not be an
employee of Impax or be entitled to employment with Impax.)

Mark, we believe that you will contribute to the company’s overall success and
that Impax will provide you the career environment and opportunities that you
seek. We look forward to your joining the Impax team. If you have any questions
please call me at 510-240-6045.

 

Sincerely, /s/ Paul R. Ulatoski

Paul R. Ulatoski

Vice President Human Resources

Impax Laboratories, Inc.

 

Accepted by:     /s/ Mark Schlossberg   Date:   March 17, 2011 Mark Schlossberg
   

CC: Dr. Larry Hsu, Ph.D., President and CEO

 

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