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Exhibit 4.1.(a)  

  

Kenneth
C. Cancellara

**

**

** 

 
 

Amendments to Employment Contract    
    

        Reference
is made to the executive employment agreement (the "2003 Agreement") dated as of March 1, 2003 between you and Biovail Corporation ("Biovail"). By signing and returning
the duplicate copy of this letter agreement (the "Amending Agreement") to Biovail, you and Biovail are agreeing to amend the 2003 Agreement as set out below to the extent expressly set out herein.
Should there be any inconsistencies between the Agreement and this Amending Agreement, the terms of this Amending Agreement shall govern. The 2003 Agreement, as amended by this Amending Agreement
remains in full force and effect and is referred to herein as the "Amended Agreement". 

	1.
	Your
main office will be located at the Biovail offices at 2 Bloor Street West, 18th Floor (the "Bloor Street Office") in Toronto. Secretarial and
other support for this office will be provided at the discretion of Biovail. The transfer of any Biovail employees to the Bloor Street office must be approved by Biovail's Vice President, Corporate
Human Resources. 
	2.
	Biovail
is prepared to accommodate your need for time away from the office to deal with family matters for up to one day per week, provided that you are able to discharge
your responsibilities as set out in the Amended Agreement. The timing of your absences from the office will be subject to Biovail's requirements that you be available to it. 
	3.
	The
Amended Agreement shall continue in full force and effect until December 31, 2006, whereupon your employment with Biovail shall terminate with no right to any
further payment or benefit from Biovail, including any further accrual of entitlement under any share compensation arrangement (for greater certainty, Section 1.03 of the 2003 Agreement is
hereby amended accordingly). 
	4.
	On
the earlier of June 30, 2005 or the time at which you are advised that Biovail has hired a new General Counsel, you will no longer have the titles of General
Counsel or Corporate Secretary. Thereafter, your title shall Senior Legal Counsel. 
	5.
	You
will report to the Board of Directors and will have dotted line responsibility to the General Counsel (at such time as a General Counsel is appointed). The board of
directors (the "Board") of Biovail may direct that you will take direction from and report directly to the Board or to any committee or member of the Board with respect to any particular matter. 

	 	 	Biovail Corporation

7150 Mississauga Road

Mississauga, Ontario Canada

L5N 8M5	 	[ILLEGIBLE]

1.905.286.3000

1.905.286.3050

www.biovail.com

CONFIDENTIAL TREATMENT REQUESTED

CONFIDENTIAL TREATMENT REQUESTED: INFORMATION FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED IS OMITTED AND IS NOTED WITH "**".

AN UNREDACTED VERSION OF THIS DOCUMENT HAS BEEN FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

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	6.
	You
shall continue to discharge your duties as General Counsel and Corporate Secretary until the earlier of June 30, 2005 and that on which you are replaced as
contemplated above, whereupon you shall continue to be responsible for such litigation in which Biovail is involved and such legal matters as Biovail may determine from time to time. 
	7.
	The
Severance Period shall be the lesser of 12 months and the balance of the term of your employment (as set out in Section 3 hereof) (for greater
certainty, Section 2.01(a) of the 2003 Agreement is hereby amended accordingly). 
	8.
	Section
2.01(b) is hereby deleted. 
	9.
	Upon
a Change of Control, you will be entitled to be paid the balance of the remuneration that would have been payable to you under Article 3 of the Amended
Agreement. The existing provisions of Section 2.01(c) are hereby eliminated. 
	10.
	In
consideration of the covenants set out in this Amending Agreement, you agree that the amendments set out herein shall not give rise to any rights you may have under
Section 2.01(b) of the 2003 Agreement or to any other rights except as set out in this Amending Agreement. 
	11.
	You
hereby confirm that you have the benefit of independent legal advice with respect to this Amending Agreement. 
	12.
	This
Amending Agreement shall be governed by the laws of Ontario and the federal laws of Canada applicable therein. 
	13.
	This
Amending Agreement may be executed in counterparts. 

	 	 	Yours Sincerely,
	

 	
 	

/s/  EUGENE MELNYK      

I
hereby agree with the foregoing, this 25th date of January, 2005 

	

 	
 	

/s/  MIKE STEWART      
	
	 	

	Kenneth C. Cancellara	 	Witness

	 	 	Biovail Corporation

7150 Mississauga Road

Mississauga, Ontario Canada

L5N 8M5

www.biovail.com	 	 
	

	 	 	 	 

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Exhibit 4.2  

Senior
Executive 

 
 

BIOVAIL CORPORATION    
    
    EXECUTIVE EMPLOYMENT AGREEMENT    
    

THIS
AGREEMENT made as of the 1st day of March, 2003. 

BETWEEN:

Biovail Corporation

(hereinafter called the "Corporation") 

OF THE FIRST PART

—and— 

Brian H. Crombie

(hereinafter called the "Executive") 

OF THE SECOND PART

        WHEREAS this Employment Agreement which the parties agree will supersede and replace the current Employment Agreement dated
                        , and which provides, among other things, that the Executive devote substantially all his time and
attention during normal business hours to the performance of his duties hereunder upon
the terms and conditions hereinafter set forth; 

        NOW THEREFORE IN CONSIDERATION of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the
receipt and sufficiency whereof is hereby acknowledged, the parties hereto agree as follows. 

ARTICLE ONE—GENERAL DUTIES AND TERM  

Employment Services  

1.01    The
Corporation hereby engages the Executive to perform the services described in Schedule A attached hereto and the Executive agrees to provide such services on the terms and
conditions as herein provided. This Agreement supersedes all existing oral or written agreements between the Corporation and the Executive. 

General Duties and Obligations of Executive  

1.02    The
Executive shall: 

	(a)
	well
and faithfully serve the Corporation to the best of his ability; 

CONFIDENTIAL TREATMENT REQUESTED

CONFIDENTIAL TREATMENT REQUESTED: INFORMATION FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED IS OMITTED AND IS NOTED WITH "**".

AN UNREDACTED VERSION OF THIS DOCUMENT HAS BEEN FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

1

 

	(b)
	acknowledges
that his employment by the Corporation shall, unless otherwise mutually agreed to in writing, be his only occupation and that he/she will devote substantially all his
working time and attention during normal business hours to the performance of his duties and the observing of all reasonable instructions given to the Executive;

	(c)
	shall
reasonably use his best efforts to promote the success of the business of the Corporation (the "Business") now or hereafter conducted by the Corporation; and

	(d)
	shall
not engage in any activity during normal working hours that would impair his ability to perform his duties or that will put the Executive in conflict with respect to such
duties. 

Term of Agreement  

1.03    This
Agreement shall continue in full force and effect indefinitely and until terminated by either the Executive or the Corporation pursuant to the terms hereof. 

ARTICLE TWO—TERMINATION AND RESIGNATION  

I      Termination by the Corporation  

A     Without Just Cause  

2.01 a)    During
the term of this Agreement, the Corporation may terminate the Executive's employment without just cause at any time upon the payment by the Corporation to the
Executive of an amount (the "Severance Payment') equal to 12 months' (the "Severance Period") base salary, and including the vesting during the Severance Period of any unvested options or the
payment of any other amounts or benefits. (For greater certainty and by way of example, if the Executive is terminated on January 1, the Executive would not be entitled to receive any further
grant of options but would be entitled to have vested during the ensuing Severance Period any previously granted but unvested options which would have otherwise vested during the Severance Period.)
The Executive shall be under no obligation to seek other employment or otherwise mitigate his lost employment during the Severance Period. The Executive shall be entitled to be considered in good
faith for a pro-rated bonus for the period of his employment during the calendar year when he is terminated without just cause. 

        During
the period consisting of the earlier of the duration of the Severance Period and the Executive's commencing alternate employment, the Executive shall continue to remain on the
Corporation's medical and dental plans (provided that such is allowed by the provider of such benefits; provided
further that if the plan does not allow for such continuation, the Corporation will pay to the Executive the value thereof). 

2.01 b)    The
Executive may terminate his employment with the Corporation, which termination shall be deemed to be a termination by the Corporation without just cause, entitling
Executive to receive the severance and other benefits set forth in Section 2.01 a) above, upon the occurrence of any of the following events: 

	(i)
	any
permanent assignment to the Executive of any duties which are materially inconsistent with the Executive's position as Senior Vice President and Chief Financial
Officer of the Corporation. A period longer than three months shall be deemed to be permanent for the purpose of this subparagraph;

	(ii)
	any
material and permanent reduction by the Corporation in the Executive's authority, responsibilities or status. A period longer than three months shall be deemed to
be permanent for the purpose of this subparagraph;

	(iii)
	it
is agreed that upon the occurrence of any of the events referred to in Paragraph 2.01(b)(i) and (ii) above, the Executive shall give written
notice to the Corporation of such event and the Corporation shall have thirty (30) days within which to rectify such alleged event or 

2

 

	(iv)
	any
requirement by the Corporation that Executive's place of employment be based more than fifty (50) kilometers from the perimeter of the Greater Toronto Area. 

2.01 c)    Change of Control    

        Upon
a Change of Control, the Corporation shall provide to the Executive, (a) the total Severance Payment of 24 months base and bonus within 30 days of the closing
of such Change in control transaction and, (b) any unvested options held by Executive shall have their vesting accelerated in full so as to become one hundred percent (100%) vested and
immediately exercisable in full as of the date of closing of such Change of Control transaction. The Executive shall have 12 months from the closing of
the Change of Control transaction within which to exercise such options. In addition, the Executive shall be entitled to a full vesting of all options due to be granted to the Executive during the
twelve (12) months following the public announcement of the Change of Control transaction, which options shall be deemed to have been priced at the same price as those in the immediately
preceding year. The vesting of these latter options shall vest immediately upon the closing of the Change of Control transaction but shall be exercisable as to 33% on that date, 33% on the first
anniversary of the closing of the Change of Control transaction and the remainder on the second anniversary of the closing of the Change of Control transaction. Notwithstanding the staggered schedule
for the exercise of the options described in the immediately preceding sentence, in the event that the Executive's employment ceases prior to the second anniversary of the closing of the Change of
Control transaction, all unexercised options shall be immediately exercisable by the Executive upon his cessation of employment. The surviving Corporation may decide in its sole discretion whether to
continue the Executive's employment with the Corporation in its sole discretion. In the event that the Executive is terminated by, or resigns from, the surviving corporate entity, the Executive shall
not be entitled to any further compensation. 

        For
the purposes of this Agreement, "Change of Control" means: 

	(i)
	the
lease, exchange, license, sale or other similar disposition of all or substantially all of the assets of the Corporation in one transaction or a series of related
transactions and Eugene Melnyk is no longer Chairman of the Corporation; or

	(ii)
	with
the approval of the stockholders of the Corporation, a merger, amalgamation, reorganization, plan of arrangement, consolidation or other similar transaction
(hereinafter collectively a "Merger"), in a single transaction or a series of related transactions, the result of which Merger is that the individuals or entities acquiring voting securities of the
Corporation pursuant to such Merger hold, directly or indirectly, more than 50% of the outstanding shares of the resultant Corporation and Eugene Melnyk is no longer Chairman of the Corporation; or

	(iii)
	the
acquisition of more than 50% of the voting securities of the Corporation by any person(s) or entity (other than Eugene Melnyk or any of his affiliates), pursuant
to a tender offer or similar transaction and Eugene Melnyk is no longer Chairman of the Corporation. 

B     With Just Cause  

2.02    The
Corporation may terminate the Executive's employment without notice and without any severance or other remuneration save for salary actually earned to the date of such
termination where the Executive's employment is terminated with just cause. Without limiting the generality of the foregoing, just cause shall be deemed to include the following: 

	(a)
	where
the Executive has been convicted of any criminal offence involving moral turpitude;

	(b)
	upon
the Executive's commission of gross or continuing material negligence committed in the performance of his duties. Provided that the Executive shall first be given thirty days'
written notice to cure or rectify such gross or continuing negligence;

	(c)
	upon
the Executive's commission of serious or willful misconduct; 

3

 

	(d)
	upon
the Executive's failure to comply in any material way with any of the provisions of this Agreement. Provided that the Executive shall first be given thirty days' written notice
to cure or rectify such failure to comply with the provisions of this Agreement;

	(e)
	upon
a breach of a material term in the Executive's Confidentiality Agreement following written notice thereof to the Executive (as hereinafter defined); or

	(f)
	for
any other reason that, at law, shall amount to just cause. 

C.    Other Causes for Termination  

2.03    In
addition to the above, the Executive's employment shall also be terminated without notice and without any severance or other remuneration upon: 

	(a)
	the
voluntary resignation or retirement of the Executive; or

	(b)
	illness,
disease, physical or mental incapacity which render the Executive generally incapable of performing his duties or unfit to advance or represent the good business name of the
Corporation on a daily basis for a period of twelve (12) consecutive months and within such twelve (12) months, the Executive fails to produce to the Corporation a medical opinion
indicating a reasonable time for the return of the Executive to the full-time assumption of his past duties and responsibilities. Nothing herein is intended to circumvent or abridge the
Corporation's short-term and long-term disability policies. 

II     Executive Resignation  

D.    Resignation  

2.04    In
the event that the Executive wishes to resign from the Corporation, the Executive agrees to provide to the Corporation sixty (60) days' prior written notice of such
intention to resign (the "Resignation Period") and the Corporation, may at its discretion, determine whether the Executive's resignation shall take effect on the date of such notice or at an earlier
time, in which latter case, the Corporation shall pay to the Executive, in a lump sum, to the end of the Resignation Period. And shall further continue to provide to the Executive all benefits
including the vesting of all options and the accrual of bonus during the Registration Period. 

ARTICLE THREE—REMUNERATION  

Remuneration  

3.01 A.    Salary.    For services to be rendered hereunder, the Executive shall receive an annual base salary as set forth
in Schedule B attached hereto. The Executive will be considered annually for increases in base salary in accordance with Corporation policy and subject to review and approval by the Chief
Executive Officer ("CEO") or the Compensation Committee of the Board, as appropriate. 

        B.    Bonus.    The Executive shall be eligible a bonus as more particularly described in Schedule B, hereto.
Any bonus is subject to the approval of the Chairman of the Corporation. The Corporation retains the authority to review, grant, deny or revise any bonus in its sole discretion. The target level of
such bonus is set forth in Schedule B attached hereto. 

Expenses  

3.02    The
Executive shall be reimbursed for reasonable out of pocket business expenses, including travel and entertainment expenses actually and properly incurred by the Executive in the
course of performing his services hereunder, upon furnishing to the Corporation reasonable supporting statements and vouchers provided that where, in any financial year. the Corporation has provided
to the Executive an approved 

4

 

budget,
such expenses must not exceed the amount so budgeted without the prior written approval from the Corporation. 

Vacation  

3.03    The
Executive shall be entitled to paid vacation and vacation entitlement as more particularly described in Schedule B, hereto. 

Group Life and Health Benefits  

3.04    Group
Life and Health Benefits shall be provided to the Executive in accordance with the Corporation's Group Life and Health Benefits Plan and policies, a copy of which has been
provided to the Executive, as these apply to Senior Executives. 

Stock Option Program  

3.05    The
Executive shall be eligible to receive stock options as more particularly described in Schedule "B", hereto. 

ARTICLE FOUR—EXECUTIVE'S OBLIGATIONS  

Confidentiality  

4.01    The
Executive agrees to be bound by the terms of the confidentiality agreement (the "Confidentiality Agreement") dated the date hereof, which Confidentiality Agreement has been read,
understood and executed by the Executive and is attached hereto as Schedule C and which is incorporated by reference into this Agreement. 

Non-Competition  

4.02    The
Executive acknowledges that the Corporation currently conducts Business activities in North America (the "Territory"). The Executive further acknowledges that, in the future, the
Business activities are expected to substantially expand territorially. Accordingly, the Executive hereby agrees and covenants that he/she shall not during the term of this Agreement and for a period
of one (1) year thereafter, directly or in any manner whatsoever, including without limitation, either individually, in partnership, jointly or in conjunction with any other individual,
partnership, corporation, unincorporated organization, trust, joint venture, the Crown or any agency or instrumentality thereof of any juridical entity (a "Person"), in the Territory or in any other
regions or countries where the Corporation may be carrying on its business objects at the relevant time: 

	(a)
	carry
on, be engaged in, take part in or be a party to any undertaking, directly or indirectly; or

	(b)
	consult,
advise, render services to lend money, guarantee the debts or obligations of or permit the use of his name or any part thereof by any Person who carries on a business; 

which
actively competes directly with the Corporation's business objects or, could be judged to be causing or potentially be causing through competitive acts, material harm to the Corporation. 

        For
the purposes of this Section 4.02, as of the date of this Agreement, a Person shall be defined as ** and any of their affiliates and subsidiaries and, in addition, shall
include any pharmaceutical entity with which the Corporation has a product(s) licensing agreement, any entity in which the Corporation has a minority equity interest and any entity with which the
Corporation is at the time actively considering a commercial relationship. 

        During
the continuance of his employment, the Executive shall not (other than solely as a holder of not more than three per cent (3%) of the issued and outstanding voting shares of any
public corporation or 

5

 

as
a shareholder of the Corporation, without the written approval of the board of directors of the Corporation, directly or indirectly, either individually or in partnership or in conjunction with any
Person or Persons, firm, association, syndicate, company or corporation as principal, agent, director, manager, servant, shareholder or in any other manner whatsoever,) carry on or be engaged in or be
concerned with or interested in any business or vocation whatsoever which would be reasonably judged to be competitive to the Business or would impede the Executive in performing his duties as
outlined herein. 

Solicitation and Hiring  

4.03    The
Executive hereby covenants and agrees that he/she shall not during the term of this Agreement and for a period of eighteen (18) months thereafter, either directly or
indirectly, solicit or endeavour to solicit from the Corporation any of its employees, customers, or suppliers for the pharmaceutical compounds used by Biovail and shall not for a period of
18 months from the end of the term of this Agreement hire any of the foregoing on his own behalf or on behalf of any entity for which the Executive is hired or retained. 

Injunctive Relief  

4.04    The
Executive acknowledges and agrees that the agreements and covenants in this Article Four are essential to protect the business and goodwill of the Corporation and that a breach
by the Executive of the covenants in Sections 4.01, 4.02 and 4.03 hereof could result in irreparable harm to the Corporation for which the Corporation could not be adequately compensated in damages
and that, accordingly, the Corporation may have no adequate remedy at law if the Executive breaches such provisions. Consequently, if the Executive breaches any of such provisions, the Corporation
shall have, in addition to and not in lieu of, any other rights and remedies available to it under any law or in equity, the right to obtain injunctive relief to restrain any breach or threatened
breach thereof and to have such provisions specifically enforced by any court of competent jurisdiction. 

Severability of Covenants in Full or in Part  

4.05    The
parties acknowledge that the provisions of Article Four hereof (the "Restrictive Covenants") are reasonable and valid in geographic and temporal scope and in all other respects.
If any court of competent jurisdiction determines that any of the Restrictive Covenants or any part thereof, is or are invalid or unenforceable, the Executive and the Corporation agree that the
remainder of the Restrictive Covenants shall not be affected by the deemed invalid portions. If any court of competent jurisdiction determines that any of the Restrictive Covenants or any part thereof
is unenforceable because of the duration or geographical scope of such provision, the parties hereto agree that such court shall have the power to reduce the duration or scope of such provision, as
the case may be, and in its reduced form such provision shall then be enforceable. 

Assignment of IP  

4.06    The
Executive shall disclose to the Corporation any and all Intellectual Property (as defined in the Confidentiality Agreement) which he/she may make solely, jointly, or in common
with other employees during the term of his employment with the Corporation and which relates to the Business. Any Intellectual Property coming within the scope of the Business made and/or developed
by the Executive while in the employ of the Corporation, whether or not conceived or made during regular working hours, and whether or not the Executive is specifically instructed to make or develop
same, shall be for the benefit of the Corporation and shall be regarded as work made in the course of employment for the purposes of the Copyright Act
(Canada). The Executive shall assign, set over and transfer to the Corporation his entire right, title and interest in and to any and all of the Intellectual Property and to all letters patent and
applications for letters patent which may be, or may have been filed andlor issued by or to him or on his behalf and the Executive agrees to execute and deliver to the Corporation any and all
instruments 

6

 

necessary
or desirable to accomplish the foregoing and, in addition, to do all lawful acts which may be necessary or desirable to assist the Corporation to obtain and enforce protection of the
Intellectual Property. To the extent of any rights Executive may have with respect to the Intellectual Property which are not assignable, including but not limited to moral rights, the Executive
hereby waives same. The Executive will execute and deliver to the Corporation or its successors and assigns, such other and further assignments, instruments and documents as the Corporation from time
to time reasonably may request for the purpose of establishing, evidencing, and enforcing or defending its complete, exclusive, perpetual, and world-wide ownership of all rights, titles,
and copyrights, in and to the Intellectual Property, and Executive constitutes and appoints the Corporation as agent and attorney-in-fact, with full power of substitution, to
execute and deliver such assignments, instruments, documents as Executive may fail to refuse to execute and deliver, this power and agency being coupled with an interest and being irrevocable. 

Standards of Business Conduct  

4.07    The
Executive acknowledges and agrees that he/she has read and understood and agrees to be bound by the Corporation's Standards of Business Conduct, which is attached hereto as
Schedule D. 

Human Resources Management  

4.08    The
Executive acknowledges receipt of the Human Resources Management System and agrees to be bound by all of the terms, policies and procedures contained therein. 

No Conflicting Obligations  

4.09    The
Executive warrants to the Corporation that: 

	(a)
	the
performance of the Executive's duties as an employee of the Corporation will not breach any agreement or other obligation to keep confidential the Confidential Information of any
third party; and

	(b)
	the
Executive is not bound by any agreement with or obligation to any third party that conflicts with the Executive's obligations as an employee of the Corporation. 

ARTICLE FIVE—INTERPRETATION AND ENFORCEMENT  

Sections and Headings  

5.01    The
parties further acknowledge that if any provision contained in this Agreement is determined to be invalid or unenforceable in whole or in part, such invalidity or
unenforceability shall attach only to such provision or part thereof and the remaining part of such provision and all other provisions hereof shall continue in full force and effect. 

5.02    The
division of this Agreement into Articles and Sections and the insertion of headings are for the convenience of reference only and shall not affect the construction or
interpretation of this Agreement. 

Number  

5.03    In
this Agreement words importing the singular number only shall incluiie the plural and vice versa and words importing the masculine
gender shall include the feminine and neuter genders and vice versa. 

Entire Agreement  

5.04    This
Agreement and all the Schedules hereto constitute the entire Agreement between the parties with respect to the subject matter hereof and cancels and supersedes any prior
understandings and agreements between the parties with respect thereto. There are no representations, warranties, forms, 

7

 

conditions,
undertakings or collateral Agreements, express, implied or statutory between the parties other than as expressly set forth in this Agreement. 

Amendments and Waivers  

5.05    No
amendment to this Agreement shall be valid or binding unless set forth in writing and duly executed by both parties. No waiver of any breach of any term or provision of this
Agreement shall be effective or binding unless made in writing and signed by the party purporting to give the same and, unless otherwise provided in written waiver, shall be limited to the specific
breach waived. 

5.06    This
Agreement shall be deemed to have been made in and shall be construed in accordance with the laws of The Province of Ontario and all legal proceedings contemplated in this
Agreement shall be brought in, and be governed by, the laws of The Province of Ontario, without regard to principles of conflicts of law. 

Notices  

5.07    Any
demand, notice or other communication (hereinafter in this section 5.07 referred to as a "Communication") to be made or given in connection with this Agreement shall be
made or given in writing and may be made or given by personal delivery or by registered mail addressed respectively to the recipients: 

	 
	 	 
	 	 
	 	 

	 	 	To the Executive:	 	Brian H. Crombie

**

**	 	 
	

 	
 	

To the Corporation:	
 	

7150 Mississauga Road

Mississauga, Ontario

L5N 8M5

Attn: Chief Legal Officer	
 	

 

or
such other address or individual as may be designed by notice by either party to the other. Any communication made or given by personal delivery shall be conclusively deemed to have been given on
the day of the actual delivery thereof and, if made or given by registered mail, on the third business day following the deposit thereof in the mail. If the party giving any Communication knows or
ought reasonably to know of any difficulties with the postal system which might affect the delivery of the mail, any such Communication shall not be mailed but shall be made or given by personal
delivery. 

Benefit of Agreement  

5.08    This
Agreement shall enure to the benefit of and be binding upon the parties hereto and their respective heirs, executors, legal personal representatives, successors and assigns. 

Assignment  

5.09    The
Executive may not assign his or its rights or obligations under this Agreement without the prior written consent of the Corporation which consent may be unreasonably withheld.
The Corporation may unilaterally assign this agreement to an affiliate without consent but on notice to the Executive. 

Execution of Agreement  

5.10    The
Executive acknowledges that he/she has executed this Agreement freely; that he/she has reviewed his Agreement thoroughly; that he/she agrees with its contents; that he/she has
been given the 

8

 

opportunity
to obtain the benefit of independent legal advice; and that the terms herein are reasonable for the fair protection of both the Executive and the Corporation. 

        IN WITNESS WHEREOF the parties have executed this Agreement on the 16th day of May at Mississauga. 

	 	 	 	 	BIOVAIL CORPORATION
	

 	
 	

Per:	
 	

/s/  EUGENE MELNYK      

	

 	
 	

Per:	
 	

 

	
SIGNED, SEALED AND DELIVERED

in the presence of:	
 	

 	
 	

 
	

/s/  M. GARRAWAY      
 Witness	
 	

 	
 	

/s/  BRIAN H. CROMBIE      
Brian H. Crombie

9

   
Senior Executive 

"SCHEDULE A"  

 EMPLOYMENT SERViCES  

        The Executive shall serve as the Senior Vice President and Chief Financial Officer of the Corporation and, as such, shall perform services commensurate with such
position and such other services as reasonably requested by the Chairman of the Board of the Corporation. 

10

 
"SCHEDULE B"  

 REMUNERATION AND VACATION  

1.    Vacation    

The
Executive shall be entitled to receive four weeks of paid vacation annually, with increases as may be determined pursuant to the Corporation's policies. 

2.    Base Salary    

The
Executive's base annual salary effective March 1, 2003 shall be $400,000 (USD). The Executive shall be entitled to an annual increase in salary as determined by the Chairman. The
Executive's base salary shall be converted and paid in Canadian currency. The conversion into Canadian currency shall be made at the beginning of every quarter at a rate equal to the average rate for
the previous quarter (as furnished by the Controller of the Corporation). 

3.    Bonus    

The
Executive will be eligible to participate in the Corporation's 2003 Annual Incentive Plan with a target bonus of 50% of the Executive's base salary. The actual amount of the bonus will be
determined by the achievement of corporate objectives and by personal performance. 

4.    Stock Options    

	(i)
	Grant

The
Executive shall be entitled to receive a grant of options of up to 100,000 options per year of which 50,000 shall be unconditionally granted and the remaining 50,000 shall be "earned" based on the
fulfillment of corporate objectives and by personal performance. Provided that in the event of a stock split following any such grant of options, the number of options so granted both unconditionally
and "earned" shall be subject to such split(s). For greater certainty, options that have been granted to the Executive (whether or not priced) shall be subject to future splits. By way of example, if
a stock split occurs in any given year, those options granted to the Executive, pursuant to this Paragraph 4(i) of Schedule B, for that year shall be subject to the stock split;
however, future grants of options will not be retroactively subject to any stock split. 

	(ii)
	Vesting

The
annual options granted shall vest over four (4) years, at the rate of twenty five percent (25%) per year (the "Vesting Period") and may be exercised by the Executive pursuant to the
procedure described in the Company's Management Stock Option Program, dated March 1, 1996, as amended. 

	(iii)
	Accelerated
Vesting 

Notwithstanding
any other provision contained in this Agreement, or in any policy of the Company and notwithstanding the Vesting Period, all options granted (but not yet vested) to the Executive shall
fully and unconditionally vest immediately upon: 

	(a)
	a
"change of control" as defined in Article 2.01 (c) hereof; or

	(b)
	when
the Executive has completed at least ten (10) years of employment with the Corporation and his years of employment plus his age shall equal seventy (70) ("Seventy
Factor") and the Executive is no longer employed with the Corporation. Provided that no vesting shall occur with respect to those options granted to the Executive in the year when the Executive ceases
to be employed with the Corporation.

	(c)
	upon
the death of the Executive. 

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	(iv)
	Time
of Exercise 

Notwithstanding
any other provision contained in this Agreement, or in any policy of the Corporation, the Executive shall have, in his sole discretion, one (1) year following the cessation of
his employment or following the termination of an agreed upon affiliation with the Corporation within which to exercise any of his unexercised options, provided that his cessation of employment shall
occur at, or following, the attainment of the "Seventy Factor". Provided that if the Executive is terminated for just cause, all vested options must be exercised by the Executive within 30 days
from the date of termination. Upon the death of the Executive, the Executive's Estate shall have in its sole discretion, one (1) year thereafter within which to exercise any of the Executive's
unexercised options. 

12

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BIOVAIL CORPORATION EXECUTIVE EMPLOYMENT AGREEMENT

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