ALPHARMA INC. CHANGE
IN CONTROL PLAN
Amended and Restated Effective January 1, 2005
Purpose of the Plan
The purpose of the Alpharma Inc. Change in Control PlanFebruary
19, 2004 (the "Plan") is to provide certain executive Employees
with benefits that will assist them with their transition following
a Change in Control. The Plan was initially effective March 11,
2002, and was amended and restated effective April 5, 2004. The
Plan is being amended and restated in its entirety effective
January 1, 2005.
This Plan represents an amendment and restatement of all prior
change in control plans, practices or policies in effect at
Alpharma or any of its Subsidiaries as of the effective date
hereof, and supersedes any and all such prior change in control
plans, practices and policies. Except as otherwise specified in the
Plan all such prior change in control plans, practices and policies
are hereby discontinued and terminated, to the extent permitted by
law.
Wherever any words are used herein in the masculine gender they
shall be construed as though they were also used in the feminine
gender in all cases where they would so apply, and wherever any
words are used herein in the singular form they shall be construed
as though they were also used in the plural form in all cases where
they would so apply.
SECTION I -
DEFINITIONS
The following definitions shall apply for purposes of this
Plan:
1.1
"Acquiring Company" - Has the meaning provided in the definition of
Change in Control.
1.2
"Alpharma" - Alpharma Inc., a Delaware Company.
1.3
"Benefit Continuation Period" -In the case of an Executive who
receives a Change in Control Benefit, his Benefit Continuation
Period will be determined based on the number of months used in
Section 4.2 to compute the Executive's Change in Control
Benefit.
1.4
"Board" - The Board of Directors of Alpharma.
1.5
"Change in Control" - (i) The acquisition by any person, entity or
"group" (Acquiring Company") within the meaning of Section 13(d)
(3) or 14(d) (2) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act") (excluding, for this purpose, Alpharma or its
Subsidiaries, or any employee benefit plan of Alpharma or its
Subsidiaries which acquires beneficial ownership of voting
securities of Alpharma) of beneficial ownership (within the meaning
of Rule 13d-3 promulgated under the Exchange Act) of shares of
Common Stock of Alpharma sufficient to elect a majority of
directors to the Board; (ii) persons who, as of the date of this
Plan, constitute the Board (the "Incumbent Board") cease for any
reason to constitute at least a majority of the Board, provided
that any person becoming a director on the Board subsequent to the
date hereof whose election, or nomination for election by
Alpharma's stockholders, was approved by a vote of at least a
majority of the directors on the Board then comprising the
Incumbent Board shall be considered as though such person were a
member of the Incumbent Board; (iii) approval by the stockholders
of Alpharma or a reorganization, merger or consolidation, in each
case, with respect to which persons who were the stockholders of
Alpharma immediately prior to such reorganization, merger or
consolidation do not, immediately thereafter, beneficially own
shares sufficient to elect a majority of directors in the election
of directors of the reorganized, merged or consolidated company; or
(iv) a liquidation or dissolution of Alpharma (other than pursuant
to the United States Bankruptcy Code) or the conveyance, transfer
or leasing of all or substantially all of the assets of Alpharma to
any person; provided, however , that for the purposes of
clauses (i) - (iv) above, the terms "person", "entity" and "group"
shall not include (x) A.L. Industrier ASA ("Industrier"), (y) the
stockholders of Industrier in the case of a distribution of shares
of capital stock of Alpharma beneficially owned by Industrier to
the shareholders of Industrier, unless a Change in Control of
Industrier has occurred or occurs concurrently with such a
distribution, or in series of related transaction of which such
distribution is part, (determined without regard to this clause (y)
of this proviso) or (z) E.W. Sissener, his spouse, any heir or
descendant of Mr. Sissener or the spouse of any such heir or
descendant of the estate of Mr. Sissener (each, an "EWS Party"), or
any trust or other similar arrangement for the benefit of any EWS
Party or any corporation or other person or entity controlled by
one or more EWS Party or any group of which any EWS Party is a
member. For purposes of the preceding sentence, a "liquidation" or
"dissolution" shall not be deemed to include any transfer of
Alpharma property solely to any persons identified in clauses (x),
(y) and (z) of the proviso of such sentence. Notwithstanding
anything to the contrary in the foregoing, effective September 8,
2005, no transaction or series of transactions shall constitute a
'Change in Control' unless the Committee affirmatively concludes
that such transaction or series of transactions constitutes a
'Change of Control'.
1.6
"Change in Control Benefits" - Has the meaning provided in Section
4.2.
1.7 "Chief
Executive Officer" - Chief Executive Office of Alpharma
1.8
"Committee" - The Benefits Committee appointed by the Chief
Executive Officer to administer the Plan which shall consist of at
least three (3) employees: the Executive Vice President, Human
Resources, the Chief Financial Officer, and the Chief Legal
Officer. Effective September 8, 2005, 'Committee' shall mean the
Compensation Committee of the Board.
1.9
"Company" - Alpharma Inc. and its US Subsidiaries and any non-US
Subsidiary whose Board of Directors (or similar governing body) has
adopted this plan, or any successor by merger, consolidation or
sale of assets.
1.10 "Constructive
Termination" - A voluntary resignation following a Change in
Control and following an action initiated by Alpharma, a Subsidiary
or an Acquiring Company which results in (i) a reduction in the
Executive's compensation or a reduction in the basis upon which
such Executive's bonus or commission is determined, (ii) the
Executive's relocation to a base office or site which is more than
50 miles from the location of the Executive's office or site prior
to the Change in Control, (iii) the assignment of duties
substantially inconsistent with, or a substantial diminution of,
the duties, responsibilities or status of the position that the
Executive held prior to the Change in Control, (iv) a reduction in
benefits, or (v) a change in reporting relationship which is
detrimental to the Executive (including, without limitation, a
detrimental change in the position to which the Executive reports
and not including, without limitation, the termination or change in
the person who held the position to whom the Executive reported
prior to the Change in Control).
1.11 "Employee" - A
full-time permanent salaried or hourly employee of the Company, as
determined by the Committee. An Employee shall not include any
individual classified by the Company as either a temporary
employee, a leased employee or an independent contractor
(regardless of whether such individual is classified or
retroactively reclassified as an employee of the Company by any
person, entity or agency).
1.12 "Executive" - An
Employee who is providing services to the Company in one of the
following capacities: the Chief Executive Officer, a member of the
Leadership Team, an Employee holding the title of Vice President or
Director (not to be confused with a member of the Board) of the
Company or its Operating Divisions, or any other individual deemed
by the Committee to be an Executive.
1.13 "Involuntary
Termination of Employment" - A Termination of Employment which was
initiated by the Company other than a Termination for Cause. The
Committee shall have complete discretion to determine whether an
Involuntary Termination of Employment has occurred.
1.14 "Leadership Team"
- Those officers of the Company that report directly to the Chief
Executive Officer and such other employees who the Chief Executive
Officer, in his sole discretion, determines is eligible to be
classified as a member of the Leadership Team for purposes of this
Plan.
1.15 "Non Qualifying
Sale" - A sale of (i) the stock or assets of a Subsidiary or the
assets of an Operating Division or (ii) assets (other than
substantially all the assets of the Company).
1.16 Operating
Division" - The Company's operating divisions, which for management
or financial purposes are reported as individual business
segments.
1.17 "Plan" - The
Alpharma Inc. Change in Control Plan.
1.18 "Salary" - An
Executive's annual base salary immediately preceding his
Termination Date. In the United States, Salary shall include
amounts contributed on behalf of the Executive to a cafeteria plan
or a cash or deferred arrangement and not includable in
compensation under Section 125 or 402(e)(3) of the Internal Revenue
Code. Salary shall also include cash amounts paid to an Executive
in lieu of fringe benefits. Salary shall exclude the following:
commissions; incentive compensation; bonuses; overtime; extended
workweek premiums; cost-of-living allowances; shift premiums; other
premiums; deferred compensation; payments under consulting
agreements; payments under advisory agreements; any other special
payments, fees, or allowances.
1.19 "Subsidiary" -
Any corporation in which Alpharma owns either directly or
indirectly, more than 50% of the voting stock.
1.20 "Termination
Date" - The date an Executive's active employment with the Company
terminates as a result of an Involuntary Termination of Employment
or a Constructive Termination.
1.21 "Termination for
Cause" - A Termination of Employment for reasons such as a
conviction of a felony, habitual excessive use of drugs or alcohol,
unsatisfactory attendance, substantial and willful neglect of job
duties, failure or inability to adequately perform job duties,
disclosure of confidential information regarding the Company or its
operations, or the aiding or assisting of any person or entity
which is competitive with the Company or its successors. The
determination of whether an Executive is terminated for cause or
not for cause shall be made by the Committee in its sole discretion
and shall be final and conclusive.
1.22 "Termination of
Employment" - A termination of employment with the Company for any
reason other than by reason of retirement, death or disability
provided that a transfer of employment to the Acquiring Company or
any of its affiliates shall not be a Termination of Employment
unless it constitutes a Constructive Termination.
1.23 "US Employee" -
An Employee whose primary place of employment is in the United
States.
1.24 "US Subsidiary" -
Any Subsidiary incorporated in the United States.
1.25 "Waiver and
Release" - A form of waiver and release provided by the Company
which has the effect of releasing the Company, its affiliates,
officers, directors on the Board and employees from any and all
claims, demands, causes of action, damages, expenses and
liabilities, whether known or unknown, which the Executive has or
may later have against the Company which relate in any way to his
employment by the Company, or his separation from employment with
the Company, or any other matter at the time of Termination of
Employment.
ARTICLE II -
ELIGIBILITY
2.1
Eligibility for Change in Control Benefits.
-
-
Subject to Section 3.1, an Executive shall be eligible to receive
Change in Control Benefits specified under Article IV if
concurrently with or within the 24-month period following the
Change in Control he has either (i) an Involuntary Termination of
Employment or (ii) a Constructive Termination.
-
An Executive shall not be eligible for Change in Control Benefits
if he is subject to a collective bargaining agreement or comparable
labor agreement or is otherwise not permitted to participate
pursuant to the laws of the jurisdiction where he is employed.
-
A Non Qualifying Sale shall not be deemed a Change in Control and
an Executive shall not be eligible to receive Change in Control
Benefits upon a Non Qualifying Sale.
2.2
Committee Discretion . The Committee shall have full
discretion to determine eligibility to receive benefits under this
Plan. Such discretion shall be exercised in accordance with the
provisions set forth herein and in a uniform and non-discriminatory
fashion.
ARTICLE III - CONDITIONS
3.1
Change in Control Benefits Conditions . The following are
conditions to an Executive receiving Change in Control
Benefits:
a.
Termination Date on or after March 11, 2002;
b.
Termination Date does not immediately follow a period
during which the Executive has not been actively at work due to
leave of absence, layoff or salary continuance, unless the
Committee specifically designates the condition as not applicable
to the Executive;
c.
To the extent that an Executive claims that Constructive
Termination has occurred, such claim shall be made in writing to
the Committee within 90 days following the Constructive Termination
event;
d.
If requested by the Company or Acquiring Company, the
Executive shall remain employed with the Company or the Acquiring
Company for up to six months following the Change in Control;
and
e.
Executive executes a Waiver and Release and does not
revoke it within seven (7) days after the execution thereof.
To the extent the duration of the
Change in Contro
