ALPHARMA INC.
SEVERANCE PLAN
Amended and Restated Effective January 1, 2005
Purpose of the Plan
The purpose of the Alpharma Inc. Severance Plan (the "Plan"), is
to provide permanent Employees (as defined below) with uniform
severance benefits that will financially assist them with their
transition following an involuntary termination of employment,
other than for cause. The Plan was initially effective March 11,
2002, and was amended and restated effective February 19, 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
severance 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 severance plans, practices and policies to
the extent permitted by law. Except as otherwise specified in the
Plan all such prior severance plans, practices and policies are
hereby discontinued and terminated.
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
"Alpharma" - Alpharma Inc., a Delaware company.
1,2
"Benefit Continuation Period" - In the case of a Participant who
receives a Severance Benefit, his Benefit Continuation Period will
be determined based on the number of weeks or months, as the case
may be, used in Section 4.2 to compute the Participant's Severance
Benefit.
1.3
"Board" - The Board of Directors of Alpharma.
1.4
"Change in Control Plans" - The Change in Control Plan, as may be
approved by the Board or the Board's Compensation Committee.
1.5
"Chief Executive Officer" - Chief Executive Officer of Alpharma
Inc.
1.6
"Committee" - The Benefits Committee appointed by the Chief
Executive Officer to administer the Plan which shall consist of
three (3) employees: the Executive Vice President, Human Resources,
the Chief Financial Officer, and the Chief Legal Officer.
1.7
"Company" - Alpharma Inc., 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.
1.8
"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).
1.9
"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, or 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.
1.10 "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.
1.11 Leadership Team"
- The Chief Executive Officer and 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.
1.12 "Non Qualifying
Sale" - A sale of (i) the stock or assets of a Subsidiary or the
assets of an Operating Division of the Company or (ii) assets of
the Company.
1.13 Operating
Division" - The Company's operating divisions, which for management
or financial purposes are reported as individual business
segments.
1.14 "Participant" -
An Employee or an Executive who the Committee determines is
eligible to receive Severance Benefits pursuant to Article II.
1.15 "Plan" - The
Alpharma Inc. Severance Plan.
1.16 "Salary" - (a) A
Participant's annual base salary immediately preceding his
Termination Date. In the United States, Salary shall include
amounts contributed on behalf of the Employee 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.
(b) For purposes of this Plan, weekly
Salary shall be equal to a Participant's annual Salary divided by
52.
1.17 "Severance
Benefits" - Has the meaning provided in Section 4.2.
1.18 "Subsidiary" -
Any corporation in which Alpharma owns either directly or
indirectly, more than 50% of the voting stock.
1.19 "Termination
Date" - The date a Participant's active employment with the Company
terminates as a result of an Involuntary Termination of
Employment.
1.20 "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 Employee is terminated for cause or not
for cause (as it relates to eligibility to receive benefits under
the Plan) shall be made by the Committee in its sole discretion and
shall be final and conclusive.
1.21 "Termination of
Employment" - A termination of employment with the Company for any
reason other than by reason of retirement, death or disability.
1.22 "US Subsidiary" -
Any Subsidiary incorporated in the United States.
1.23 "US Employee" -
An Employee whose primary place of employment is in the United
States.
1.24 "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 Participant 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.
1.25 "Years of
Service" - Each complete twelve (12) months of uninterrupted
employment with the Company as an Employee. Only the last period of
continuous employment as an Employee with the Company shall be
considered in the determination of a Participant's number of Years
of Service with the Company.
ARTICLE II -
ELIGIBILITY
2.1 Eligibility for Severance
Benefits .
(a) Subject to Section 3.1,
an Employee shall be eligible to receive Severance Benefits
specified under Article IV in the event that he has an Involuntary
Termination of Employment.
(b) An Employee shall not
be eligible for Severance Benefits if (i) he is eligible to receive
Change in Control Benefits as defined under any Change in Control
Plan or (ii) 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 or (iii) to the extent he is an Employee other than an
Executive, he is eligible to receive different severance benefits
pursuant to the laws of the jurisdiction in which he is
employed.
(c)
An Employee shall not be entitled to Severance Benefits upon a
Non-Qualifying Sale unless the Committee, in its discretion, adopts
rules extending Severance Benefits to such 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
Severance Benefits Conditions . The following are conditions
to a Participant receiving Severance Benefits:
(a)
Termination Date on or after March 11, 2002;
(b)
Termination Date does not immediately follow a period during which
the Participant 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
Participant; and
(c)
Participant executes a Waiver and Release and does not revoke it
within seven (7) days after the execution thereof.
(d)
To the extent the duration of the Severance Benefits is longer than
any notice period required under the laws of the jurisdiction in
which participant is employed, then such severance benefits shall
be in lieu of such notice period.
ARTICLE IV - SEVERANCE BENEFITS
4.1
General .
Subject to Section 6.1, a Participant who is eligible under
Section 2.1 to receive Severance Benefits and who satisfies the
conditions in Section 3.1 shall receive the amount of Severance
Benefits specified under Section 4.2 payable in accordance with
Article VII and those other benefits as specified in Article V.
4.2
Amount of Severance Benefits . The amount of severance
benefits ("Severance Benefits") shall be as follows:
-
-
The Severance Benefit payable to a Participant who is not an
Executive shall be an amount equal to two (2) weeks' Salary for
each Year of Service. In no event shall the Severance Benefit
determined under the prior sentence be less than four (4) weeks'
Salary or greater than fifty-two (52) weeks' salary.
-
The Severance Benefit payable to an Executive shall be an
amoun
