Exhibit 10.7

EXECUTION VERSION

SEPARATION AND GENERAL RELEASE AGREEMENT

This SEPARATION AND GENERAL RELEASE AGREEMENT (this “Agreement”) is made as of
October 1, 2019 (the “Effective Date”), between Teva Pharmaceuticals USA, Inc.,
a Delaware corporation (the “Company”), and Carlo de Notaristefani (the
“Executive”). The Company and the Executive are collectively referred to herein
as the “Parties.” Capitalized terms not otherwise defined herein shall have the
meaning set forth in that Amended and Restated Employment Agreement dated as of
February 7, 2018, between the Company and the Executive (the “Employment
Agreement”).

1. Notice and Separation. The Parties hereto agree and acknowledge that the
Executive employment with the Company shall terminate on June 30, 2020 (the
“Termination Date”). For the avoidance of doubt, the period between the date of
the Agreement and the Termination Date shall include the Notice Period pursuant
to the Employment Agreement.

2. The Executive hereby agrees to resign all of the Executive’s positions
(whether as an officer, director or any other position) that he holds with the
Company Group, effective as of October 1, 2019, and the Executive will execute
such additional documents as reasonably requested by the Company to evidence the
foregoing. The Parties further agree that through the Termination Date, the
Executive shall provide assistance and support to the new Executive Vice
President, Global Operations of the Teva Group to ensure a smooth transition and
to perform any other duties assigned to him by the Chief Executive Officer of
the Company Group.

3. 2019 Annual Cash Bonus. Subject to the discretion of the Compensation
Committee, the TPI Board, the Compensation Policy and the terms of the 2019
Annual Cash Bonus Plan, the Executive shall be eligible to be considered for
payment of the annual Cash Bonus for 2019. For the avoidance of doubt, Executive
not be eligible to participate in the Company Group’s 2020 Annual Cash Bonus
Plan.

4. Severance. Subject to the terms and conditions of this Agreement, the Company
agrees to pay to the Executive:

(a) all accrued but unpaid Base Salary through the Termination Date (which shall
be paid on the first ordinary payroll date following the Termination Date), (ii)
any unpaid or unreimbursed reasonable out-of-pocket expenses incurred by the
Executive in connection with the business of the Company in accordance with
Company policy to the extent incurred prior to the Termination Date (which shall
be paid following Executive submission of such receipts evidencing such expenses
in accordance with the Company’s expense reimbursement policies), (iii) any
other amounts required to be paid pursuant to applicable law, if any, and
(iv) accrued and/or vested benefits under any plan or agreement covering the
Executive which shall be paid in accordance with, and governed by, the terms of
such plan or agreement;

 

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(b) a lump sum cash payment in an amount equal to $836,400, which is equal to
twelve (12) months of the Executive’s Base Salary as of the Termination Date,
which shall be paid on the next regular payroll date immediately following the
sixtieth (60th) day after the Termination Date;

(c) an amount equal to $836,400, which is equal to twelve (12) months of the
Executive’s Base Salary as of the Termination Date in consideration for the
Executive’s compliance with the Restrictive Covenants set forth in Section 9 of
the Employment Agreement, which will be paid in substantially equal installments
in accordance with the payroll practices of the Company during the twelve
(12) month period commencing on the Termination Date;

(d) a lump sum cash payment of $42,313, which shall be paid on the next regular
payroll date immediately following the sixtieth (60th) day after the Termination
Date, in consideration of the Company obligations pursuant to Section 7(d)(v) of
the Employment Agreement (the amounts described in Sections 3(b), 3(c) and 3(d),
collectively, the “Severance Payments”); and

(e) all outstanding equity-based compensation awards granted to the Executive
under the Long-Term Equity-Based Incentive Plan (the “Equity Plan”) of TPI (as
defined in the Employment Agreement) shall continue to vest and remain
exercisable (to the extent applicable) following the Termination Date as if
Executive had remained employed by the Company, in accordance with the terms and
conditions of the applicable Equity Plan and the individual award agreements
evidencing such grants (including, for the avoidance of doubt, any performance
vesting conditions and any original stated expiration date of options) (the
“Equity Benefits”).

The Company’s obligation to pay the Executive the Severance Payments and provide
the Equity Benefits shall be subject to the Executive’s execution and
non-revocation of the Release of Claims attached as Exhibit A to the Employment
Agreement within sixty (60) days following the Termination Date (the date on
which the Release of Claims becomes non-revocable, the “Release Effective Date”)
and the Executive’s continued compliance with the Restrictive Covenants (as
defined below).

Further, to the extent that any portion of the Severance Payments constitutes
“nonqualified deferred compensation” within the meaning of Section 409A of the
U.S. Internal Revenue Code of 1986, as amended (the “Code”) and all applicable
regulations and guidance thereunder (“Section 409A”), any payment of any amount
or provision of any benefit otherwise scheduled to occur prior to the sixtieth
(60th) day following the date of the Executive’s termination of employment
hereunder, but for the condition that the Executive execute the Release of
Claims as set forth herein, shall not be made until the first regularly
scheduled payroll date following such sixtieth (60th) day (subject to any
additional delay as may be required under Section 7(a) of this Agreement), after
which any remaining Severance Payments shall thereafter be provided to the
Executive according to the applicable schedule set forth herein.

 

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5. Restrictive Covenants.

(a) The Executive hereby acknowledges and agrees that Section 9 of the
Employment Agreement contain certain restrictive covenants and related
provisions (the “Restrictive Covenants”), all of which will remain in full force
and effect following the Termination Date in accordance with their terms.

(b) The executive hereby acknowledge and agrees that until the Termination Date
and at all times thereafter, he shall cooperate with the Company and its
attorneys in connection with any matter related to the period he was employed by
Teva USA and/or his services to other members of the Teva Group, including but
not limited to any threatened, pending, and/or subsequent litigation, government
investigation, or other formal inquiry against ant member of the Teva Group, and
shall make himself available upon notice to prepare for and appear at
deposition, hearing, arbitration, mediation, or trial in connection with any
such matters. Such cooperation will include willingness to be interviewed by
representatives of the Company and to participate in legal proceedings by
deposition or testimony.

(c) Notwithstanding any provision herein to the contrary, and without derogating
from any other remedy available to the Company pursuant to applicable law, in
the event that the Executive breaches any of the Restrictive Covenants,
(i) payment or provision of the Severance Payments shall immediately cease
(without prejudice to any other remedies available to the Company hereunder
and/or pursuant to applicable law), (ii) the Company will have no further
obligations to the Executive with respect to payment or provision of the
Severance Payments and (iii) the Executive must promptly repay to the Company
any Severance Payments and benefits set forth in Sections 3(b), 3(c) and 3(d)
hereof paid or provided to the Executive prior to the date of such breach.

(d) The Executive understands that nothing in this Agreement or the Restrictive
Covenants limits the Executive’s ability to file a charge or complaint with the
Equal Employment Opportunity Commission, the National Labor Relations Board, the
Occupational Safety and Health Administration, the Securities and Exchange
Commission or any other federal, state or local government agency or commission
(collectively, the “Government Agencies”). The Executive further understands
that neither this Agreement nor the Restrictive Covenants limits the Executive’s
ability to communicate with any Government Agencies or otherwise participate in
any investigation or proceeding that may be conducted by any Government Agency,
including providing documents or other information, without notice to the
Company. Neither this Agreement nor the Restrictive Covenants limits the
Executive’s right to receive an award for information provided to any Government
Agencies.

 

 

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6. Additional Section 409A Provisions. All payments and benefits under this
Agreement shall be made and provided in a manner that is intended to comply with
Section 409A, to the extent applicable. Notwithstanding any provision in this
Agreement to the contrary:

(a) The payment (or commencement of a series of payments) hereunder of any
“nonqualified deferred compensation” (within the meaning of Section 409A) upon a
termination of employment shall be delayed until such time as the Executive has
also undergone a “separation from service” as defined in U.S. Treasury
Regulation Section 1.409A-1(h), at which time such “nonqualified deferred
compensation” (calculated as of the Termination Date) shall be paid (or commence
to be paid) to the Executive on the schedule set forth in this Agreement as if
the Executive had undergone such termination of employment (under the same
circumstances) on the date of his ultimate “separation from service.” Any
payment otherwise required to be made hereunder to the Executive at any date as
a result of the termination of the Executive’s employment shall be delayed for
such period of time as may be necessary to meet the requirements of
Section 409A(a)(2)(B)(i) of the Code (the “Delay Period”) in the event that the
Executive is deemed at the time of his “separation from service” to be a
“specified employee” (in each case, within the meaning of Section 409A) and if
such delay is otherwise required to avoid additional tax under
Section 409A(a)(2) of the Code. In such event, on the first business day
following the expiration of the Delay Period, the Executive shall be paid, in a
single lump sum cash payment, an amount equal to the aggregate amount of all
payments delayed pursuant to the preceding sentence, and any remaining payments
not so delayed shall continue to be paid pursuant to the payment schedule set
forth herein.

(b) Each payment in a series of payments hereunder shall be deemed to be a
separate payment for purposes of Section 409A.

(c) To the extent that any right to reimbursement of expenses or payment of any
benefit in-kind under this Agreement constitutes “nonqualified deferred
compensation” (within the meaning of Section 409A), (i) any such expense
reimbursement shall be made by the Company no later than the last day of the
taxable year following the taxable year in which such expense was incurred by
the Executive, (ii) the right to reimbursement or in-kind benefits shall not be
subject to liquidation or exchange for another benefit, and (iii) the amount of
expenses eligible for reimbursement or in-kind benefits provided during any
taxable year shall not affect the expenses eligible for reimbursement or in-kind
benefits to be provided in any other taxable year; provided that the foregoing
clause shall not be violated with regard to expenses reimbursed under any
arrangement covered by Section 105(b) of the Code solely because such expenses
are subject to a limit related to the period during which the arrangement is in
effect.

(d) While the payments and benefits provided hereunder are intended to be
structured in a manner to avoid the implication of any penalty taxes under
Section 409A, in no event whatsoever shall the Company or any of its affiliates
be liable for (i) any additional tax, interest or penalties that may be imposed
on the Executive as a result of Section 409A or (ii) any damages for failing to
comply with Section 409A (other than for withholding obligations or other
obligations applicable to employers, if any, under Section 409A).

 

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7. Entire Agreement.

(a) Except as otherwise expressly provided herein, this Agreement and the
Employment Agreement (including but not limited to Section 24 of the Employment
Agreement) constitute the entire agreement between the Executive and the Company
with respect to the subject matter hereof and supersedes any and all prior
agreements or understandings between the Executive and the Company, any member
of the Teva Group and any of the Company’s principal shareholders, affiliates or
subsidiaries.

(b) Notwithstanding the foregoing, each of the following will remain in full
force and effect in accordance with their existing terms and will be unaffected
by this Agreement: (i) any confidentiality, invention assignment, or similar
agreement or arrangement to which the Executive is a party with any member of
the Teva Group, which obligations shall remain in force and effect, (ii) the
Indemnification and Release, dated as August 1, 2012.

(c) In addition, this Agreement shall not derogate from the TPI Board of
Director’s General Discretion and Clawback powers pursuant to TPI Compensation
Policy and all restrictions set forth in the Compensation Policy (as defined in
the Employment Agreement) shall remain in full force and effect through the
Termination Date, and following the Termination Date shall remain in effect only
to the extent applicable to terminated employees.

(d) This Agreement will bind the heirs, personal representatives, successors and
assigns of the Executive and the Company, and inure to the benefit of the
Executive and the Company, and each of the Executive’s respective heirs,
successors and assigns, provided that the Executive may not assign his rights or
obligations hereunder. This Agreement may be amended or modified only by a
written instrument executed by the Executive and the Company. This Agreement and
the obligations of the Parties hereunder shall be construed, interpreted and
enforced in accordance with the laws of the State of Delaware (without reference
to conflict of laws principles).

[Remainder of page intentionally left blank. Signature page follows.]

 

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IN WITNESS WHEREOF, the Parties have executed this Agreement on the latest date
set forth below.

 

TEVA PHARMACEUTICALS USA, INC. By:  

/s/ Deborah A. Griffin

Name:   Deborah A. Griffin Title:   SVP & Chief Accounting Officer Date:  
November 4, 2019 By:  

/s/ Brian E. Shanahan

Name:   Brian E. Shanahan Title:   Secretary Date:   November 4, 2019

 

EXECUTIVE

/s/ Carlo De Notaristefani

Carlo De Notaristefani Date: October 31, 2019

 

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