1983 Incentive Stock Option Plan

EXHIBIT 99
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A.L. Pharma Inc. - 1983 Incentive
Stock Option Plan, as amended


1. Purpose of the Plan.
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This 1983 Incentive Stock Option Plan (the "Plan") of A.L. Pharma Inc. (the "Company"), is designed to provide incentive to present and future executive, managerial, marketing, technical and other key employees of the Company and of its subsidiaries (hereinafter referred to as "Employees") by affording such Employees an opportunity to acquire or increase their proprietary interest in the Company through the acquisition of shares of its Class A Common Stock. By encouraging stock ownership by such Employees, the Company seeks to attract and retain in its and its subsidiaries' employ persons of exceptional competence and seeks to furnish an added incentive for them to increase their efforts on behalf of the Company.


2. Administration.
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This Plan shall be administered by a committee of the Board of Directors of the Company consisting of two or more directors (the "Options Committee") appointed for such purpose; provided that if at any time Rule 16b-3 or any successor rule ("Rule 16b-3") under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and Section 162(m) ("Section 162(m)") of the Internal Revenue Code of 1986, as amended, or any successor statutory provision thereof (the "Code"), and any implementing regulations (and any successor provisions thereof), so permit without adversely affecting the ability of the Plan to comply with the conditions for exemption from Section 16 of the Exchange Act (or any successor provision) provided by Rule 16b-3 and the exemption from the limitations on the deductibility of certain executive compensation provided by Section 162(m), the Options Committee may delegate the administration of the Plan in whole or in part, on such terms and conditions, to such other person or persons as it may determine in its discretion. The membership of the Options Committee or such successor committee shall be constituted so as to comply at all times with the applicable requirements of Rule 16b-3 and Section 162(m). No member of the Options Committee shall have within one year prior to his appointment received awards under the Plan or under any other plan, program or arrangement of the Company or any of its affiliates if such receipt would cause such member to cease to be a "disinterested person" under Rule 16b-3; provided that if at any time Rule 16b-3 so permits without adversely affecting the ability of the Plan to comply with the conditions for exemption from Section 16 of the Exchange Act (or any successor provision) provided by Rule 16b-3, one or more members of the Options Committee may cease to be a "disinterested person."


All questions of interpretation and application of this Plan, of options granted hereunder (the "Options"), of any related agreements and instruments, and of the value of shares


of Class A Common Stock subject to Options, shall be subject to the good faith determination of the Options Committee, which shall be final and binding. If for any reason an Options Committee shall not have been appointed, all authority and duties of the Options Committee under this Plan shall be vested in and exercised by the Board of Directors of the Company.


3. Option Shares.
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The stock subject to the Options and other provisions of this Plan shall be shares of the Company's Class A Common Stock, par value $.20 per share (hereinafter referred to as the "Common Stock"). The total amount of the Common Stock with respect to which Options may be granted shall not exceed in the aggregate 2,500,000/1/ shares; provided, however, that the type and aggregate number of shares which may be subject to Options granted hereunder shall be subject to adjustment in accordance with the provisions of paragraph 16 hereof, and further provided that if Incentive Stock Options (as defined below) are granted, the aggregate fair market value (determined as of the time the option is granted) of the Stock with respect to which Options are exercisable for the first time by any single Employee during any calendar year shall not exceed $100,000. The maximum number of shares of Common Stock which any single Employee may acquire pursuant to a grant of Options (including under the alternative cash settlement right described below) in any one taxable year of the Company shall not exceed 100,000 shares of Common Stock (subject to adjustment in accordance with the provisions of paragraph 16 hereof). Such shares may be treasury shares or authorized but unissued shares.


If for any reason the full number of shares covered by any Option are not issued before the Option expires or terminates, shares not issued under such Option shall again be available for the grant of Options under this Plan.


4. Authority to Grant Options.
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The Options Committee may grant Options from time to time to such eligible Employees as it shall determined; provided, however, that no Options may be granted to any person who is a member of the Options Committee at the time of such grant. Subject only to any applicable limitations set forth in this Plan, the number of shares of Common Stock which may be purchased pursuant to any Option shall be as determined by the Options Committee.


In the discretion of the Options Committee, Options granted under this Plan may be "incentive stock options" as such term is defined in Section 422A of the Internal Revenue Code of 1986 ("Incentive Stock Options"), or Options which do not meet such definition. The option agreement with respect to any Option intended to qualify as an Incentive Stock Option shall so identify such Option.


- ------------------- /1/ Reflects 1985, 1986 and 1991 stock splits, additional shares approved at the 1986, 1988, 1989, 1991, 1993 and 1995 stockholders' meetings.


5. Limitation on Value of Shares Covered by Incentive Stock Options Granted to
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any Employee.
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The aggregate fair market value (determined as of the time the Option is granted) of the Common Stock with respect to which any employee may be granted Incentive Stock Options under this Plan and any other plans of the Company or any parent or subsidiary of the Company shall not exceed the amount permitted by Section 422A of the Internal Revenue Code of 1986.


6. Eligibility.
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The individuals who shall be eligible to participate in the Plan shall be such Employees from the class of executive, managerial, marketing, technical and other key employees as the Options Committee shall determine from time to time.


7. Option Price.
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The price at which shares may be purchased pursuant to any Option shall be specified by the Options Committee at the time the Option is granted, and shall be equal to or greater than the fair market value, as determined by the Options Committee, of the shares of Common Stock on the date the Option is granted.


8. Terms of the Options; Vesting.
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The Options Committee shall determine the term of each Option which shall in no event exceed ten years and one month from the date of grant. Unless the Committee shall otherwise determine at the time of grant, Options shall vest at the rate of 25% per year that the Employee holds such Option so that Options shall not become fully exercisable until four years from the date of grant. Accordingly, unless the Committee shall otherwise determine at the time of grant, Options cannot be exercised until one year after the Option has been granted and then 25% of the Option Shares may be purchased during the second year, 50% during the third year, 75% during the fourth year, and 100% after four years. Subject to the limitations contained in paragraph 12 hereof, the Options Committee may, in its discretion: (a) accelerate the time at which any outstanding Option or part thereof shall become exercisable and (b) extend the time during which any outstanding Option may be exercised, provided that no Option may be exercised more than ten years and one month after the date of grant. There shall be deemed to be part of the conditions and terms of every Option granted hereunder as an Incentive Stock Option each condition, term, limitation or restriction which is required under Section 422A of the Internal Revenue Code and the applicable regulations for such Option to qualify as an Incentive Stock Option.


9. Amount Exercisable.
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Each Option may be exercised, so long as it has vested and is valid and outstanding, from time to time, in part or in whole, subject to any limitations with respect to the number of shares for which the Option may be exercised at a particular time and to such other conditions as the Options Committee in its discretion, may specify.


10. Exercise of Options.
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Options shall be exercised by the delivery of written notice to the Company (Attention: Treasurer) setting forth the number of shares with respect to which the Option is to be exercised and the address to which the certificates for such shares are to be mailed, together with (i) cash (including checks, bank drafts or postal or express m ...