Document:

AMENDED AND RESTATED

                         PHARMACEUTICAL RESOURCES, INC.

                          2000 PERFORMANCE EQUITY PLAN

Section 1.  Purpose; Definitions.

     1.1.  Purpose.  The  purpose of the  Amended  and  Restated  Pharmaceutical
Resources,  Inc.  (the  "Company")  2000  Performance  Equity Plan (the "Plan"),
adopted for the term set forth in Section 9 hereof,  is to enable the Company to
offer to its key  employees  and to key  employees  of its  subsidiaries,  Stock
Options in the Company,  thereby  enhancing  its ability to attract,  retain and
reward such key  employees,  and to increase the mutuality of interests  between
those employees and the stockholders of the Company.

         The  Company  previously  adopted  the 1990 Stock  Incentive  Plan (the
"Prior  Plan").  Awards granted under the Prior Plan prior to the effective date
of this Plan  ("Prior  Awards")  shall not be affected  by the  adoption of this
Plan, and the Prior Plan shall remain in effect  following the effective date to
the extent necessary to administer the Prior Awards.

     1.2.  Definitions.  For purposes of the Plan, the following  terms shall be
defined as set forth herein:

          (a) "Agreement" means the agreement between the Company and the Holder
setting forth the terms and conditions of an award under the Plan.

          (b) "Board" means the Board of Directors of the Company.

          (c)  "Change of  Control"  means a change of  control  of the  Company
pursuant to Section 6 hereof.

          (d) "Code"  means the Internal  Revenue Code of 1986,  as amended from
time to time, and any successor statute or statutes thereto.

          (e) "Committee"  means the Stock Option  Committee of the Board or any
other committee of the Board which the Board may designate.

          (f) "Common  Stock" means the Common  Stock of the Company,  par value
$.01 per share.

          (g)  "Company"  means  Pharmaceutical  Resources,  Inc., a corporation
organized under the laws of the State of New Jersey, and any successor thereto.

          (h)  "Disability"  means  disability  as determined  under  procedures
established by the Committee for purposes of the Plan.

<PAGE>

          (i)  "Exchange  Act" means the  Securities  Exchange  Act of 1934,  as
amended from time to time, or any successor statute or statutes thereto.

          (j)  "Exchange  Act  Holder"  means such  officer or  director  or 10%
beneficial owner of Common Stock subject to Section 16(b) of the Exchange Act.

          (k) "Fair Market Value," unless  otherwise  required by any applicable
provision of the Code or any  regulations  issued  thereunder,  means, as of any
given  date:  (i) if the Common  Stock (as  hereinafter  defined) is listed on a
national securities exchange or quoted on the NASDAQ National Market System, the
closing price of the Common Stock on the last  preceding day on which the Common
Stock was traded,  as reported on the  composite  tape or by  NASDAQ/NMS  System
Statistics,  as the case may be;  (ii) if the  Common  Stock is not  listed on a
national securities exchange or quoted on the NASDAQ National Market System, but
is traded  in the  over-the-counter  market,  the  average  of the bid and asked
prices for the Common Stock on the last preceding day for which such  quotations
are  reported by NASDAQ;  and (iii) if the fair market value of the Common Stock
cannot be  determined  pursuant to clause (i) or (ii) hereof,  such price as the
Committee shall determine.

          (l) "Holder" means an eligible employee or prospective employee of the
Company or a Subsidiary who has received an award under the Plan.

          (m)  "Non-Qualified  Stock  Option"  means  any Stock  Option  that is
granted under the Plan.

          (n) "Plan" means this Amended and Restated  Pharmaceutical  Resources,
Inc. 2000 Performance Equity Plan, as hereafter amended from time to time.

          (o) "Prior Awards" and "Prior Plan" shall have the respective meanings
given to those terms in Section 1.1.

          (p) "Stock Option" or "Option" means any Non-Qualified Stock Option to
purchase shares of Stock which is awarded pursuant to the Plan.

          (q) "Subsidiary" means any present or future subsidiary corporation of
the Company, as such term is defined in Section 424(f) of the Code.

Section 2.  Administration.

     2.1. Committee Membership. The Plan shall be administered by the Committee,
the membership of which shall be at all times constituted so as to not adversely
affect the  compliance  of awards under the Plan with the  requirements  of Rule
16b-3 under the Exchange Act or with the  requirements  of any other  applicable
law, rule or regulation.

     2.2. Powers of Committee.  The Committee shall have full authority to award
Stock  Options  pursuant  to the terms of the Plan,  to eligible  employees  and
prospective  employees  described  under  Section  4  hereof.  For  purposes  of
illustration  and not of  limitation,  the  Committee  shall have the  authority
(subject to the express provisions of this Plan):

                                       2
<PAGE>

          (a) to select the eligible employees and prospective employees to whom
Stock Options may from time to time be awarded hereunder;

          (b) to  determine  the  Non-Qualified  Stock  Options,  if any,  to be
awarded hereunder to one or more eligible employees;

          (c) to  determine  the  number of shares to be  covered  by each award
granted hereunder;

          (d) to determine the terms and conditions,  not inconsistent  with the
terms of the Plan, of any award hereunder (including,  but not limited to, share
price, any restrictions or limitations, and any vesting, settlement,  surrender,
cancellation,  acceleration,  termination, exercise or forfeiture provisions, as
the Committee shall determine);

          (e) to determine any specified performance goals or such other factors
or  criteria  which need to be  attained  for the  vesting  of an award  granted
hereunder; and

          (f) to determine the terms and conditions under which awards hereunder
are to operate in conjunction with or apart from other equity awarded,  and cash
awards made by the Company or any Subsidiary outside of this Plan.

     2.3.  Interpretation  of Plan.  Subject to Section 8 hereof,  the Committee
shall have the authority to adopt, alter and repeal such  administrative  rules,
guidelines and practices governing the Plan as it shall, from time to time, deem
advisable,  to  interpret  the  terms and  provisions  of the Plan and any award
issued under the Plan (and to determine the form and substance of all Agreements
relating thereto), and to otherwise supervise the administration of the Plan.

         Subject  to  Section  7 hereof,  all  decisions  made by the  Committee
pursuant to the  provisions  of the Plan shall be made in the  Committee's  sole
discretion  and shall be final  and  binding  upon all  persons,  including  the
Company, its Subsidiaries and the Holders.

Section 3.   Common Stock Subject to Plan.

     3.1. Number of Shares.  The total number of shares of Common Stock reserved
and  available for  distribution  under the Plan shall be 1,025,000  shares.  In
addition, Common Stock covered by any unexercised portions of terminated Options
or Prior Awards  (including  canceled Options or Prior Awards),  or Prior Awards
which are otherwise surrendered by the Holder may again be subject to new awards
under this Plan.  The number of shares of Common Stock deemed to be issued under
the Plan upon the exercise of an Option in the nature of a stock  purchase right
shall be  reduced  by the number of shares of Common  Stock  surrendered  by the
Holder in payment of the exercise or purchase price of the award and withholding
taxes thereon.

     3.2.  Character  of  Shares.  Shares  of  Common  Stock  under the Plan may
consist,  in whole or in part,  of  authorized  and unissued  shares or treasury
shares.

     3.3.  Adjustment Upon Changes in  Capitalization,  Etc. In the event of any
acquisition, merger, reorganization,  consolidation,  recapitalization, dividend

                                       3
<PAGE>

(other  than a dividend  or its  equivalent  which is  credited to a Holder or a
regular cash  dividend),  stock split,  reverse stock split,  or other change in
corporate  structure affecting the Common Stock, such substitution or adjustment
shall be made in the aggregate  number of shares reserved for issuance under the
Plan,  in the  maximum  number of shares  with  respect  to which  awards may be
granted to any employee in any year, in the number and exercise  price of shares
subject to  outstanding  Options,  as may be determined to be appropriate by the
Committee  in order to prevent the  dilution  or  enlargement  of each  Holder's
rights,  provided that the number of shares subject to any award shall always be
a whole number.

Section 4.  Eligibility.

     4.1.  General.  Awards under the Plan may be made to (i) officers and other
key  employees  of the Company or any  Subsidiary  (including  officers  and key
employees  serving as directors of the Company) who are at the time of the grant
of an award under this Plan regularly employed by the Company or any Subsidiary;
and (ii)  prospective  employees of the Company or its  Subsidiaries;  provided,
however,   that  all  awards  must  be  made  in  compliance  with  both  (A)  a
broadly-based(1)  Plan and (B) the  conditions  that (i) no  single  officer  or
director may acquire  under the Plan more than one (1%) percent of the shares of
the issuer's common stock outstanding at the time the Plan is adopted,  and (ii)
together  with the Prior Plan does not  authorize the issuance of more than five
(5%) percent of the issuer's  common stock  outstanding  at the time the Plan is
adopted. The exercise of any Stock Option and the vesting of any award hereunder
granted to a prospective employee shall be conditioned upon such person becoming
an employee  of the Company or a  Subsidiary.  The term  "prospective  employee"
shall mean any person who holds an  outstanding  offer of regular  employment on
specific terms from the Company or a Subsidiary.

Section 5.  Stock Options.

     5.1.  Grant  and  Exercise.  Stock  Options  granted  under  the  Plan  are
Non-Qualified Stock Options.  The Committee shall have the authority to grant to
any Holder  hereof  Non-Qualified  Stock  Options  containing  such  terms,  not
inconsistent with this Plan, as the Committee may from time to time approve.

     5.2. Terms and  Conditions.  Stock Options  granted under the Plan shall be
subject to the following terms and conditions:

[FN]
--------
(1)  A plan is  "broadly-based"  if,  pursuant to the terms of the plan:  (i) at
     least a majority of the company's full time employees in the United States,
     who are "exempt  employees,"  as defined under Fair Labor  Standards Act of
     1938,  are eligible to receive stock or options under the plan; and (ii) at
     least a  majority  of the  shares of stock or  shares  of stock  underlying
     options awarded under the Plan, during the shorter of the three-year period
     commencing  on the date the Plan is adopted  by the  company or the term of
     the Plan, must be awarded to employees who are not officers or directors of
     the company.
</FN>

                                       4
<PAGE>

         (a)  Exercise  Price.  The  exercise  price per share of Common  Stock
purchasable  under a Stock Option shall be  determined  by the  Committee at the
time of grant, provided, however, that the exercise price shall not be less than
Fair Market Value.

          (b) Option  Term.  The term of each Stock Option shall be fixed by the
Committee,  but no Stock Option shall be  exercisable  more than ten years after
the date on which the Option is granted.

          (c) Exercisability. Stock Options shall be exercisable at such time or
times and subject to such terms and  conditions  as shall be  determined  by the
Committee.  If the Committee provides, in its discretion,  that any Stock Option
is exercisable  only in  installments,  the Committee may waive such installment
exercise  provisions  at any time at or  after  the time of grant in whole or in
part, based upon such factors as the Committee shall determine.

          (d) Method of Exercise. Subject to whatever installment,  exercise and
waiting period provisions are applicable in a particular case, Stock Options may
be exercised  in whole or in part at any time during the term of the Option,  by
giving written notice of exercise to the Company specifying the number of shares
of Common Stock to be purchased.  Such notice shall be accompanied by payment in
full of the purchase price, which shall be in cash or, unless otherwise provided
in the Agreement, in whole shares of Common Stock which are already owned by the
Holder of the Stock  Option or,  unless  otherwise  provided in the Stock Option
Agreement,  partly in cash and partly in such Common Stock.  Cash payments shall
be made by wire  transfer,  certified or bank check or personal  check,  in each
case payable to the order of the Company;  provided,  however,  that the Company
shall not be required to deliver  certificates  for shares of Common  Stock with
respect to which a Stock Option is exercised until the Company has confirmed the
receipt of good and available  funds in payment of the purchase  price  thereof.
Payments in the form of Common  Stock  (which shall be valued at the Fair Market
Value of a share of  Common  Stock  on the  date of  exercise)  shall be made by
delivery  of stock  certificates  in  negotiable  form  which are  effective  to
transfer  good and valid title  thereto to the  Committee,  free of any liens or
encumbrances. Payment may also be made, in the discretion of the Company, by the
delivery  (including,  without  limitation,  by  fax)  to  the  Company  or  its
designated agent of an executed  irrevocable  option exercise form together with
irrevocable  instructions  to a  broker-dealer  to sell or  margin a  sufficient
portion of the shares and deliver the sale or margin loan  proceeds  directly to
the  Company  to pay for the  exercise  price.  Except  as  otherwise  expressly
provided in this Plan or in the  Agreement,  no Stock Option may be exercised at
any time  unless the Holder  thereof is then an  employee of the Company or of a
Subsidiary.  The  Holder of a Stock  Option  shall  have none of the rights of a
stockholder  with  respect to the shares  subject to the Stock Option until such
shares shall be transferred to the Holder upon the exercise of the Stock Option.

          (e) Buyout and  Settlement  Provisions.  The Committee may at any time
offer to buy out for cash or otherwise settle a Stock Option previously granted,
based  upon such terms and  conditions  as the  Committee  shall  establish  and
communicate to the Holder at the time that such offer is made.

                                       5
<PAGE>

     5.3.  Awards  for  Acquired  Companies.  After any  merger,  consolidation,
reorganization,  stock or asset  purchase  or similar  transaction  in which the
Company or a Subsidiary  shall be a surviving  corporation,  the  Committee  may
grant Options under the provisions of the Plan, as permitted  under the Code, in
full or partial replacement of or substitution for stock options granted under a
plan of another  party to the  transaction  whose shares of stock subject to the
old options may no longer be issued  following  the  transaction.  The manner of
application  of the  foregoing  provisions  to such options and any  appropriate
adjustments  in the terms of such awards shall be determined by the Committee in
its sole discretion. Any such adjustments may provide for the elimination of any
fractional  shares  which might  otherwise  become  subject to any  awards.  The
foregoing  shall  not be  deemed  to  preclude  the  Company  from  assuming  or
substituting for stock options of acquired companies other than pursuant to this
Plan.

Section 6.  Acceleration.

     6.1.  Acceleration  Upon  Change of  Control.  Unless  the award  Agreement
provides  otherwise or unless the Holder waives the  application of this Section
6.1 prior to a Change of Control  (as  hereinafter  defined),  in the event of a
Change of Control,  each  outstanding  Stock Option granted under the Plan shall
immediately become exercisable in full  notwithstanding  the vesting or exercise
provisions contained in the Agreement.

     6.2.  Change of Control  Defined.  A "Change of Control" shall be deemed to
have occurred upon any of the following events:

          (a) any individual,  firm,  corporation or other entity,  or any group
(as defined in Section  13(d)(3) of the  Securities  Exchange  Act of 1934) (the
"Act) becomes,  directly or indirectly,  the beneficial owner (as defined in the
General Rules and  Regulations of the Securities  and Exchange  Commission  with
respect  to  Sections  13(d)  and 13(g) of the Act) of more than 20% of the then
outstanding  shares of the Company's capital stock entitled to vote generally in
the election of directors of the Company; or

          (b) the  commencement  of, or the  first  public  announcement  of the
intention of any individual,  firm,  corporation or other entity or of any group
(as defined in Section  13(d)(3) of the Act) to  commence,  a tender or exchange
offer  subject to  Section  14(d)(1)  of the Act for any class of the  Company's
capital stock; or

          (c) the stockholders of the Company approve (A) a definitive agreement
for the merger or other business combination of the Company with or into another
corporation  pursuant  to which  the  stockholders  of the  Company  do not own,
immediately  after the  transaction,  more than 50% of the  voting  power of the
corporation  that  survives  and  is a  publicly  owned  corporation  and  not a
subsidiary of another  corporation,  or (B) a definitive agreement for the sale,
exchange or other  disposition of all or substantially  all of the assets of the
Company,  or (C) any plan or proposal for the  liquidation or dissolution of the
Company;

          provided,  however,  that a "Change of Control" shall not be deemed to
have taken place if (A)  beneficial  ownership  is  acquired  by, or a tender or

                                       6
<PAGE>

exchange  offer is commenced or announced by, the Company,  any  profit-sharing,
employee ownership or other employee benefit plan of the Company, any trustee of
or fiduciary with respect to any such plan when acting in such capacity,  or any
group  comprised  solely of such entities,  or (B) there is an increase by Lipha
Americas, Inc. or its affiliates, in its stock ownership in the Company provided
that after such  increase,  the  Company is still a publicly  owned  corporation
listed on a national securities exchange or quoted on the NASDAQ National Market
System.

          (d) In the event of a Change of Control, all outstanding Stock Options
shall become exercisable in full,  whether or not otherwise  exercisable at such
time,  and any such Stock  Option shall remain  exercisable  in full  thereafter
until it expires  pursuant to its terms,  unless prior to such Change of Control
the  provisions of this Section 6 are suspended or terminated by an  affirmative
vote of a majority of the Board.

     6.3.  General  Waiver by Committee.  The Committee  may,  after grant of an
award,  accelerate  the  vesting of all or any part of any Stock  Option  and/or
waive any limitations or restrictions, if any, for all or any part of an award.

     6.4.  Acceleration Upon Termination of Employment.  In the case of a Holder
whose  employment with the Company or a Subsidiary is  involuntarily  terminated
for any reason (other than for cause),  the Committee may accelerate the vesting
of all or any part of any award  and/or  waive in whole or in part any or all of
the remaining  limitations or restrictions  imposed hereunder or pursuant to the
Agreement.

Section 7.   Forfeiture Provisions Following a Termination of Employment.

     7.1.  This  Section 7.1 shall apply to all awards  granted  under this Plan
except  to  the  extent  that  the  applicable   Agreement  provides  otherwise.
Notwithstanding  any  provision  in this Plan to the  contrary,  in any instance
where the rights of the Holder of an award  granted  under the Plan  extend past
the date of  termination  of the Holder's  employment,  all of such rights shall
immediately   and   automatically   terminate   and  be  forfeited  if,  in  the
determination  of the  Committee,  the Holder at any time  during a  twenty-four
month  period  following  his or her  termination  of  employment,  directly  or
indirectly,  either  (i)  personally  or (ii) as an  employee,  agent,  partner,
stockholder,  officer or director of,  consultant to, or otherwise of any entity
or person  engaged in any business in which the Company or any  Subsidiaries  is
engaged,  or is actively  proposing to engage at the time of such termination of
employment,  engages in conduct that  breaches his or her duty of loyalty to the
Company or any Subsidiaries or that is in material  competition with the Company
or  any  Subsidiaries  or  is  materially   injurious  to  the  Company  or  any
Subsidiaries,  monetarily or otherwise,  which conduct shall include, but not be
limited to: (i) disclosing or using any confidential  information  pertaining to
the Company or any Subsidiaries;  (ii) any attempt,  directly or indirectly,  to
induce any employee of the Company or any Subsidiaries to be employed or perform
services elsewhere; or (iii) any attempt, directly or indirectly, to solicit the
trade of any  customer or supplier  or  prospective  customer or supplier of the
Company or any Subsidiaries; or (iv) disparaging the Company or any Subsidiaries
or any of their respective  officers or directors.  The determination of whether
any  conduct,  action or  failure to act falls  within  the scope of  activities
contemplated by this Section shall be made by the Committee,  in its discretion,
and  shall be final  and  binding  upon the  Holder.  A  determination  that any

                                       7
<PAGE>

particular  conduct,  action or failure  falls  outside the scope of  activities
contemplated  by this  Section  shall not imply  that,  or be  determinative  of
whether, such conduct, action or failure is otherwise lawful or appropriate. For
purposes of this paragraph,  a Holder shall not be deemed to be a stockholder of
a competing  entity if the Holder's  record and  beneficial  ownership of equity
securities  of said  entity  amount  to not more  than one  percent  (1%) of the
outstanding  equity  securities of any company subject to the periodic and other
reporting  requirements of the Securities  Exchange Act of 1934, as amended.  In
the event the existence of any  circumstance  which would trigger the forfeiture
of an award  pursuant  to this  Section 7.1 but for the fact that said award has
previously been converted into or exercised for other  securities of the Company
(e.g.,  upon the exercise of stock  options),  or  converted  into cash or other
property  (e.g.,  upon the sale by or for the  account  of the  Holder of Common
Stock acquired by him or her upon the exercise of Stock Options), whether before
or after the termination of employment, then, in such event, said securities, or
cash or other property,  as the case may be, shall be deemed to be held in trust
for the Company and shall be promptly  paid over to the Company upon demand (net
of any amounts that may have been theretofore actually paid by the Holder to the
Company in respect thereof (e.g.,  as the cash exercise price of a warrant).  By
virtue  of his or her  acceptance  of the  award  under  the Plan to which  this
Agreement  relates,  the Holder shall be irrevocable deemed to have agreed to be
bound by the provisions of this Section 7.1. The Holder further  recognizes that
(i) the  Company  would be  irreparably  injured in the event of a breach by the
Employee of any of his obligations  under this Section 7; (ii) monetary  damages
would not be an adequate remedy for any such breach; and (iii) the Company shall
be entitled to injunctive  relief, in addition to any other remedies that it may
have, in the event of any such breach.

Section 8.  Amendments and Termination.

     8.1.  Amendments to Plan. The Board may at any time, and from time to time,
amend  any of the  provisions  of the  Plan,  and  may at any  time  suspend  or
terminate the Plan.

     8.2.  Amendments to Individual Awards. The Committee may amend the terms of
any award granted under the Plan; provided,  however,  that subject to Section 3
hereof,  no such  amendment may be made by the  Committee  which in any material
respect impairs the rights of the Holder without the Holder's consent.

Section 9.  Term of Plan.

     9.1. Effective Date. The Plan shall be effective on March 22, 2000.

     9.2. Termination Date. No award shall be granted pursuant to the Plan on or
after the tenth  anniversary of its effective  date, but awards granted prior to
or on such date may extend  beyond that date.  The Plan shall  terminate at such
time as no further  awards may be granted and all awards  granted under the Plan
are no longer outstanding.

Section 10.  General Provisions.

     10.1.  Investment  Representations.  The  Committee may require each person
acquiring  shares  of  Common  Stock  pursuant  to an  award  under  the Plan to

                                       8
<PAGE>

represent  to and agree with the Company in writing that the Holder is acquiring
the shares for investment without a view to distribution thereof.

     10.2.  Additional  Incentive  Arrangements.  Nothing  contained in the Plan
shall  prevent  the Board  from  adopting  such  other or  additional  incentive
arrangements  as it may deem  desirable,  including,  but not  limited  to,  the
granting of stock  options and the  awarding  of stock and cash  otherwise  than
under the Plan;  and such  arrangements  may be either  generally  applicable or
applicable only in specific cases.

     10.3. No Right of Employment. Nothing contained in the Plan or in any award
hereunder  shall be deemed to confer  upon any  employee  of the  Company or any
Subsidiary any right to continued employment with the Company or any Subsidiary,
nor  shall  it  interfere  in any way  with  the  right  of the  Company  or any
Subsidiary to terminate the employment of any of its employees at any time.

     10.4.  Withholding  Taxes.  Not  later  than the date as of which an amount
first becomes  includible  in the gross income of the Holder for Federal  income
tax purposes  with respect to any award under the Plan,  the Holder shall pay to
the Company,  or make arrangements  satisfactory to the Committee  regarding the
payment of, any Federal, state and local taxes of any kind required by law to be
withheld or paid with respect to such amount. If permitted by the Committee, tax
withholding or payment  obligations may be settled with Common Stock,  including
Common  Stock  that is part of the  award  that  gives  rise to the  withholding
requirement.  The obligations of the Company under the Plan shall be conditional
upon such payment or arrangements  and the Company or the Holder's  employer (if
not the Company) shall, to the extent permitted by law, have the right to deduct
any such taxes from any payment of any kind otherwise due to the Holder from the
Company or any Subsidiary.

     10.5.  Governing Law. To the extent not preempted by the laws of the United
States,  the laws of the State of New Jersey,  without  reference to conflict of
laws  provisions,  shall be the controlling  law in all matters  relating to the
Plan and all awards made and actions taken thereunder.

     10.6.  Other Benefit  Plans.  Any award granted under the Plan shall not be
deemed compensation for purposes of computing benefits under any retirement plan
of the Company or any  Subsidiary  and shall not affect any  benefits  under any
other benefit plan now or subsequently in effect under which the availability or
amount of benefits is related to the level of compensation  (unless  required by
specific reference in any such other plan to awards under this Plan).

     10.7. Employee Status. A leave of absence,  unless otherwise  determined by
the  Committee  prior to the  commencement  thereof,  shall not be  considered a
termination  of  employment.  Any  awards  granted  under the Plan  shall not be
affected by any change of employment,  so long as the Holder  continues to be an
employee of the Company or any Subsidiary.

     10.8.  Non-Transferability.  Other than the  transfer of a Stock  Option by
will,  by the laws of descent  and  distribution,  or  pursuant  to the  express

                                       9
<PAGE>

provisions  of  the  applicable  Agreement,  no  award  under  the  Plan  may be
alienated,  sold,  assigned,  hypothecated,   pledged,  exchanged,  transferred,
encumbered or charged, and any attempt to alienate,  sell, assign,  hypothecate,
pledge, exchange,  transfer, encumber or charge the same shall be void. No right
or benefit  hereunder shall in any manner be liable for or subject to the debts,
contracts,  liabilities or torts of the person entitled to such benefit.  Except
as expressly  provided in any  applicable  Agreement,  any Stock Option or other
award granted under this Plan shall be only  exercisable  during the lifetime of
the  Holder by the  Holder or by his or her  guardian  or legal  representative.
Notwithstanding the foregoing, the Company may grant Non-Qualified Stock Options
that are  transferable,  without payment of  consideration,  to immediate family
members of the Holder, to trusts or partnerships for such family members,  or to
such other parties as the Committee may approve (as evidenced by the  applicable
award  agreement  or an  amendment  thereto),  and the  Company  may also  amend
outstanding Non-Qualified Stock Options to provide for such transferability.

     10.9.  Applicable  Laws. The obligations of the Company with respect to all
awards  under the Plan shall be subject to (i) all  applicable  laws,  rules and
regulations and such approvals by any governmental  agencies as may be required,
including,  without  limitation,  the effectiveness of a registration  statement
under the Securities Act of 1933, as amended, and (ii) the rules and regulations
of any securities exchange on which the Common Stock may be listed or the NASDAQ
National Market System if the Common Stock is designated for quotation thereon.

     10.10.  Conflicts.  If any of the terms or  provisions of the Plan conflict
with  the  requirements  of Rule  16b-3  under  the  Exchange  Act,  or with the
requirements of any other applicable law, rule or regulation, then such terms or
provisions  shall be deemed  inoperative to the extent they so conflict with the
requirements of said Rule 16b-3.

     10.11.  Written  Agreements.  Each  award  granted  under the Plan shall be
confirmed by, and shall be subject to the terms of the Agreement executed by the
Company and the Holder.  The  Committee  may  terminate any award made under the
Plan if the  Agreement  relating  thereto is not  executed  and  returned to the
Company  within 60 days after the Agreement has been delivered to the Holder for
his or her execution.

     10.12. Common Stock Certificates.  Notwithstanding anything to the contrary
contained  herein,  whenever  certificates  representing  shares of Common Stock
subject to an award are  required to be  delivered  pursuant to the terms of the
Plan,  the  Company  may in lieu of such  delivery  requirement  comply with the
provisions of Section  14A:7-11 of the New Jersey Business  Corporation Act. All
certificates  for  shares  of Common  Stock  delivered  under the Plan  shall be
subject to such stop-transfer orders and other restrictions as the Committee may
deem  advisable  under the rules,  regulations,  and other  requirements  of the
Securities  and Exchange  Commission,  any stock  exchange upon which the Common
Stock is then listed,  any applicable  Federal or state  securities law, and any
applicable  corporate law, and the Committee may cause a legend or legends to be
put on any such certificates to make appropriate reference to such restrictions.

     10.13.  Unfunded  Status of Plan.  The Plan is  intended to  constitute  an
"unfunded" plan for incentive compensation. With respect to any payments not yet

                                       10
<PAGE>

made to a Holder by the Company,  nothing  contained  herein shall give any such
Holder any rights  that are  greater  than  those of a general  creditor  of the
Company.

     10.14.  Certain  Mergers.  If in connection with a merger,  reorganization,
consolidation,  share exchange,  transfer of assets or other transaction  having
similar effect involving the Company  ("Merger") in which the Company is not the
surviving corporation or pursuant to which a majority of the shares which are of
the same  class as the  shares  that are  subject  to  outstanding  Options  are
exchanged  for,  or  converted  into,  or  otherwise  become  shares of  another
corporation, the surviving,  continuing, successor or purchasing corporation, as
the case may be (the  "Acquiring  Corporation"),  does not assume the  Company's
rights and obligations  under  outstanding award agreements or substitute awards
in respect of the Acquiring  Corporation's  stock for  outstanding  awards,  the
Board shall provide prior to the Merger that any  unexercisable  and/or unvested
portion of the outstanding awards shall be immediately exercisable and vested as
of a date prior to such Merger, as the Board so determines.  The exercise and/or
vesting of any award that was permissible solely by reason of this Section 10.14
shall be conditioned upon the  consummation of the Merger.  Any awards which are
neither assumed by the Acquiring Corporation nor exercised as of the date of the
Merger shall terminate effective as of the effective date of the Merger.NINTH AMENDMENT AND WAIVER TO
                           LOAN AND SECURITY AGREEMENT

     NINTH AMENDMENT AND WAIVER,  dated as of March 27, 2001 (this "Amendment"),
to the Loan and  Security  Agreement  referred  to  below by and  among  GENERAL
ELECTRIC  CAPITAL   CORPORATION,   a  New  York  corporation   ("Lender"),   PAR
PHARMACEUTICAL,  INC.,  a New Jersey  corporation  ("Borrower"),  PHARMACEUTICAL
RESOURCES,  INC., a New Jersey corporation ("Parent"),  NUTRICEUTICAL RESOURCES,
INC., a New York corporation ("NRI"), and PARCARE,  LTD., a New York corporation
("ParCare").   Parent,   NRI  and  ParCare  are   hereinafter   referred  to  as
"Guarantors".

                               W I T N E S S E T H

     WHEREAS,  Lender,  Borrower and Guarantors are parties to that certain Loan
and Security Agreement, dated as of December 15, 1996 (as amended,  supplemented
or otherwise modified prior to the date hereof, the "Loan Agreement"); and

     WHEREAS,  Lender,  Borrower  and  Guarantors  have agreed to amend the Loan
Agreement,  and Lender has agreed to waive the  violation  of the  Minimum  EBIT
covenant  contained in the Loan  Agreement  in the manner,  and on the terms and
conditions, provided for herein.

     NOW  THEREFORE,  in  consideration  of the  premises and for other good and
valuable  consideration,  the  receipt,  adequacy and  sufficiency  of which are
hereby acknowledged, the parties to this Amendment hereby agree as follows:

     1.  Definitions.  Capitalized terms not otherwise defined herein shall have
the meanings ascribed to them in the Loan Agreement.

     2.  Amendment  to  Section  5 of the Loan  Agreement.  As of the  Amendment
Effective Date (as defined below),  Section 5(b) of the Loan Agreement is hereby
amended and restated in its entirety to read as follows:

               "(b) except as otherwise  permitted in this Section 5 below, make
               any  investment  (including  any  investment in or advance to any
               other Person for research and  development) in, or make or accrue
               loans or advances of money to, any Person, other than investments

<PAGE>

               for  research  and  development  in Persons  which are not Credit
               Parties which, together with the aggregate amount of research and
               development  expenses  of  the  Credit  Parties,  do  not  exceed
               $10,250,000  in the Fiscal Year ending on or about  December  31,
               2001;"

               3.  Amendment  to  Schedule  F to the Loan  Agreement.  As of the
          Amendment  Effective Date,  Schedule F to the Loan Agreement is hereby
          amended and  restated in its entirety to read as set forth in Schedule
          F hereto.

     4. Waiver.  Lender  hereby waives as of the  Amendment  Effective  Date all
Events of Default under Section 8.1(b) of the Loan Agreement  solely arising out
of the failure of Parent and its  Subsidiaries  to maintain,  on a  consolidated
basis,  the  minimum  EBIT  required by Section  4.2 of the Loan  Agreement  and
paragraph 1 of  Schedule F to the Loan  Agreement  for the four  Fiscal  Quarter
period ended December 31, 2000.

     5.  Representations  and  Warranties.  To induce  Lender to enter into this
Amendment, each Credit Party hereby represents and warrants that:

               A. The execution,  delivery and performance of this Amendment and
          the performance of the Loan Agreement, as amended hereby (the "Amended
          Loan  Agreement"),   by  each  Credit  Party:  (i)  are  within  their
          respective  corporate  powers;  (ii) have been duly  authorized by all
          necessary  corporate  and  shareholder  action;  and  (iii) are not in
          contravention  of any provision of their  respective  certificates  or
          articles  of   incorporation   or  by-laws  or  other   organizational
          documents.

               B. This  Amendment  has been duly executed and delivered by or on
          behalf of each Credit Party.

               C.  Each  of  this  Amendment  and  the  Amended  Loan  Agreement
          constitutes a legal, valid and binding obligation of each Credit Party
          enforceable  against each Credit Party in  accordance  with its terms,
          except as  enforceability  may be  limited by  applicable  bankruptcy,
          insolvency,  reorganization,  moratorium  or  similar  laws  affecting
          creditors'  rights  generally  and  by  general  equitable  principles
          (whether enforcement is sought by proceedings in equity or at law).

               D. No Default  (other  than those  waived  pursuant  hereto)  has
          occurred and is continuing both before and after giving effect to this
          Amendment.

                                       2
<PAGE>

               E. No  action,  claim or  proceeding  is now  pending  or, to the
          knowledge of each Credit Party,  threatened  against any Credit Party,
          at law, in equity or otherwise,  before any court, board,  commission,
          agency or instrumentality  of any federal,  state, or local government
          or of any agency or subdivision  thereof,  or before any arbitrator or
          panel of  arbitrators,  which  challenges  any Credit  Party's  right,
          power,  or competence  to enter into this  Amendment or, to the extent
          applicable,  perform any of its obligations under this Amendment,  the
          Amended Loan Agreement or any other Loan Document,  or the validity or
          enforceability  of this  Amendment,  the Amended Loan Agreement or any
          other Loan  Document  or any action  taken under this  Amendment,  the
          Amended Loan Agreement or any other Loan Document.

               F. The  representations  and  warranties  of the  Credit  Parties
          contained in the Loan  Agreement and each other Loan Document shall be
          true and correct on and as of the  Amendment  Effective  Date with the
          same effect as if such representations and warranties had been made on
          and as of such date,  except that any such  representation or warranty
          which is expressly  made only as of a specified date need be true only
          as of such date.

     6. No Other  Amendment/Waivers.  Except as expressly provided in Sections 2
and 3 hereof, the Loan Agreement shall be unmodified and shall continue to be in
full force and effect in accordance with its terms. Except as expressly provided
in Section 4 hereof,  this Amendment shall not be deemed a waiver of any term or
condition of any Loan Document and shall not be deemed to prejudice any right or
rights  which  Lender  may  now  have  or may  have in the  future  under  or in
connection  with any  Loan  Document  or any of the  instruments  or  agreements
referred to therein, as the same may be amended from time to time.

     7. Outstanding Indebtedness;  Amendment of Claims. Each Credit Party hereby
acknowledges  and agrees  that as of the date hereof the  aggregate  outstanding
principal  amount of the Revolving  Credit Loan is  $10,418,120.68.  Each Credit
Party hereby waives,  releases,  remises and forever  discharges Lender and each
other Indemnified Person from any and all Claims of any kind or character, known
or unknown,  which each Credit Party ever had, now has or might  hereafter  have
against Lender which relates,  directly or indirectly,  to any acts or omissions
of Lender or any other Indemnified Person on or prior to the date hereof.

     8. Expenses. Borrower hereby reconfirms its obligations pursuant to Section
10.2 of the  Loan  Agreement  to pay and  reimburse  Lender  for all  reasonable
out-of-pocket  expenses  (including,  without  limitation,  reasonable  fees  of
counsel) incurred in connection with the negotiation, preparation, execution and
delivery of this Amendment and all other documents and instruments  delivered in
connection herewith.

                                       3
<PAGE>

     9.  Effectiveness.  This  Amendment  shall become  effective as of the date
hereof (the "Amendment  Effective  Date") only upon  satisfaction in full in the
judgment of the Lender of each of the following  conditions on or prior to March
29, 2001:

               A.  Amendment.  Lender shall have received two original copies of
          this  Amendment  duly executed and delivered by Lender and each Credit
          Party.

               B.  Payment of Expenses.  Borrower  shall have paid to Lender all
          costs and expenses  (including a  non-refundable  amendment and waiver
          fee in the amount of $20,000 (which  amendment and waiver fee shall be
          credited to any fees to be paid by Borrower to Lender in the event the
          Revolving  Credit  Loan is  extended  or  renewed on or before May 29,
          2001)  owing in  connection  with this  Amendment  and the other  Loan
          Documents and due to Lender (including, without limitation, reasonable
          legal fees and expenses).

               C.  Representations  and  Warranties.   The  representations  and
          warranties of each Credit Party  contained in this Amendment  shall be
          true and correct on and as of the Amendment Effective Date.

     10.  GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

     11.  Counterparts.  This Amendment may be executed by the parties hereto on
any number of separate  counterparts and all of said counterparts taken together
shall be deemed to constitute one and the same instrument.

                            (SIGNATURE PAGE FOLLOWS)

                                       4
<PAGE>

     IN WITNESS  WHEREOF,  the parties  hereto have caused this  Amendment to be
duly executed and delivered as of the day and year first above written.

                                    Borrower:

                                    PAR PHARMACEUTICAL, INC.

                                    By: /s/   Dennis J. O'Connor
                                       ---------------------------------
                                       Name:  Dennis J. O'Connor
                                       Title: Vice President, Chief
                                                Financial Officer

                                    Lender:

                                    GENERAL ELECTRIC CAPITAL CORPORATION

                                    By: /s/  Michael Lustbader
                                       --------------------------------
                                       Name: Michael Lustbader
                                       Its:  Duly Authorized Signatory

                                    Parent:

                                    PHARMACEUTICAL RESOURCES, INC.

                                    By: /s/   Dennis J. O'Connor
                                       ---------------------------------
                                       Name:  Dennis J. O'Connor
                                       Title: Vice President, Chief
                                                Financial Officer

                       (SIGNATURES CONTINUED ON NEXT PAGE)

                                       5
<PAGE>

                                    Subsidiary Guarantors:
                                    ---------------------

                                    NUTRICEUTICAL RESOURCES, INC.

                                    By: /s/   Dennis J. O'Connor
                                       ---------------------------------
                                       Name:  Dennis J. O'Connor
                                       Title: Vice President, Chief
                                                Financial Officer

                                    PARCARE, LTD.

                                    By: /s/   Dennis J. O'Connor
                                       ---------------------------------
                                       Name:  Dennis J. O'Connor
                                       Title: Vice President, Chief
                                                Financial Officer

                                       6
<PAGE>
                                   Schedule F

                               FINANCIAL COVENANTS

1. Minimum  EBIT.  Parent and its  Subsidiaries  on a  consolidated  basis shall
maintain for each four Fiscal Quarter  period,  commencing  with the four Fiscal
Quarter  period  ending on or about March 31, 2001,  EBIT for such period of not
less than the amount for such period set forth below:

                  Four Fiscal Quarter Period Ending
                  on or about:                         Minimum EBIT
                  -----------                          ------------

                  March 31, 2001                         $2,300,000
                  June 30, 2001                            (300,000)
                  September 30, 2001                        300,000
                  December 31, 2001                       2,400,000

2. Minimum  Tangible Net Worth.  Parent and its  Subsidiaries  on a consolidated
basis shall maintain,  as at the end of each Fiscal Quarter,  Tangible Net Worth
of not less than the amount for such period set forth below:

                  Fiscal Quarter Ending
                  on or about:                       Minimum Tangible Net Worth
                  -----------                        --------------------------

                  March 31, 2001                         $44,000,000
                  June 30, 2001                           41,700,000
                  September 30, 2001                      42,600,000
                  December 31, 2001                       45,600,000

3. Capital  Expenditures.  Parent and its  Subsidiaries on a consolidated  basis
shall not make aggregate  Capital  Expenditures  in excess of $7,500,000 for the
Fiscal Year ending on or about December 31, 2001.

For purposes of this covenant in Schedule F the  following  terms shall have the
meanings set forth below:

     "EBIT" shall mean, for any period,  the Net Income (Loss) of Parent and its
Subsidiaries on a consolidated basis for such period, plus interest expense, tax
expense and extraordinary losses and minus extraordinary gains, in each case, of

<PAGE>

Parent and its Subsidiaries on a consolidated  basis for such period  determined
in accordance with GAAP to the extent included in the  determination of such Net
Income (Loss).

     "Net  Income  (Loss)"  shall  mean with  respect  to any Person and for any
period,  the  aggregate net income (or loss) after taxes of such Person for such
period, determined in accordance with GAAP.

     "Tangible  Net Worth"  shall mean,  with respect to any Person at any date,
all  amounts  which,   in  accordance   with  GAAP,   would  be  included  under
stockholders' equity on a consolidated balance sheet of such Person at such date
less the  aggregate  of all  intangibles  in  conformity  with  GAAP  (including
Intellectual  Property,  goodwill,  organization  expenses,  treasury stock, all
deferred financing and unamortized debt discount  expenses,  and all current and
non-current deferred tax benefits).

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00022-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00022-of-00352.parquet"}]]