EX-4.4



 





Exhibit 4.4






Confirmation of OTC Warrant Transaction




	 	 	 
	Date:

	 	March 1, 2007
	 
	 	 
	To:

	 	Mylan Laboratories Inc. (“Counterparty”)
	 
	 	 
	From:

	 	Merrill Lynch International (“MLI”)
	 
	 	 
	MLI Reference:

	 	0782711 






 




Dear Sir / Madam:




     The purpose of this letter agreement (this “Confirmation”) is to confirm the terms and
conditions of the above-referenced transaction entered into among Counterparty, MLI and Merrill
Lynch, Pierce, Fenner & Smith Incorporated (the “Agent” or “MLPFS”) on the Trade
Date specified below (the “Transaction”). This Confirmation constitutes a “Confirmation”
as referred to in the Agreement specified below.



     The definitions and provisions contained in the 2000 ISDA Definitions (the “Swap
Definitions”) and the 2002 ISDA Equity Derivatives Definitions (the “Equity
Definitions” and, together with the Swap Definitions, the “Definitions”), in each case
as published by the International Swaps and Derivatives Association, Inc., are incorporated into
this Confirmation. In the event of any inconsistency between the Swap Definitions and the Equity
Definitions, the Equity Definitions will govern, and in the event of any inconsistency between the
Definitions and this Confirmation, this Confirmation will govern. References herein to a
“Transaction” shall be deemed to be references to a “Share Option Transaction” for the purposes of
the Equity Definitions and to a “Swap Transaction” for the purposes of the Swap Definitions. For
purposes of this Transaction, “Warrant Style”, “Warrant Type”, “Number of Warrants” and “Warrant
Entitlement” (each as defined below) shall be used herein as if such terms were referred to as
“Option Style”, “Option Type”, “Number of Options” and “Option Entitlement”, respectively, in the
Definitions.



     This Confirmation evidences a complete binding agreement between you and us as to the terms of
the Transaction to which this Confirmation relates. This Confirmation (notwithstanding anything to
the contrary herein), shall be subject to, and form part of, an agreement in the 1992 form of the
ISDA Master Agreement (Multicurrency Cross Border) (the “Master Agreement” or
“Agreement”) as if we had executed an agreement in such form (but without any Schedule and
with elections specified in the “ISDA Master Agreement” Section of this Confirmation) on the Trade
Date. In the event of any inconsistency between the provisions of that Agreement and this
Confirmation, this Confirmation will prevail for the purpose of this Transaction. The parties
hereby agree that the Transaction evidenced by this Confirmation shall be the only Transaction
subject to and governed by the Agreement.



     The terms of the particular Transaction to which this Confirmation relates are as follows:



	 	 	 
	General Terms:
	 	 
	 
	 	 
	Trade Date:

	 	March 1, 2007
	 
	 	 
	Effective Date:

	 	March 7, 2007 (the “scheduled Effective Date”) subject to cancellation of the OTC
Warrant Transaction prior to 5:00 p.m. (New York City time) on such date by the
Counterparty or MLI.
	 
	 	 
	Warrant Style:

	 	European






 









 






	 	 	 
	Warrant Type:

	 	Call
	 
	 	 
	Seller:

	 	Counterparty
	 
	 	 
	Buyer:

	 	MLI
	 
	 	 
	Shares:

	 	Shares of common stock, $0.50 par value, of Counterparty (Security Symbol: “MYL”).
	 
	 	 
	Number of Warrants:

	 	12,263,103 
	 
	 	 
	Daily Number of Warrants:

	 	For any day, the unexercised Number of Warrants on such day divided by the
remaining number of Expiration Dates (including such day) and rounded down to the
nearest whole number, with the balance of the Number of Warrants exercised on the
final Expiration Date.
	 
	 	 
	Warrant Entitlement:

	 	One (1) Share per Warrant
	 
	 	 
	Strike Price:

	 	$31.20 
	 
	 	 
	Premium:

	 	$20,790,000 
	 
	 	 
	Premium Payment Date:

	 	The Effective Date; provided no cancellation of the OTC Warrant Transaction has
occurred prior to 5:00 p.m. (New York City time) on such date.
	 
	 	 
	Exchange:

	 	New York Stock Exchange
	 
	 	 
	Related Exchange(s):

	 	All Exchanges
	 
	 	 
	Full Exchange Business Day:

	 	A Scheduled Trading Day that has a scheduled closing time for its regular trading
session at 4:00 p.m. (New York City time) or the then standard closing time for
regular trading on the Exchange and is not a Disrupted Day.
	 
	 	 
	Procedures for Exercise:
	 	 
	 
	 	 
	Expiration Time:

	 	11:59 p.m. (New York City time).
	 
	 	 
	Expiration Dates:

	 	The eighty (80) consecutive Full Exchange Business Days beginning on and
including April 17, 2012 each shall be an Expiration Date for a number of
Warrants equal to the Daily Number of Warrants on such date.
	 
	 	 
	Exercise Dates:

	 	Each Expiration Date
	 
	 	 
	Automatic Exercise:

	 	Applicable; provided that Section 3.4(b) of the Equity Definitions shall apply to
Net Physical Settlement; and provided further that, unless all Warrants have been
previously exercised hereunder, a number of Warrants for each Expiration Date
equal to the Daily Number of Warrants for such Expiration Date shall be deemed to
be automatically exercised.
	 
	 	 
	Counterparty’s Telephone
Number and Telex and/or
Facsimile Number and
Contact Details for purpose
of Giving Notice:

	 	


Mylan Laboratories Inc.

1500 Corporate Drive, Canonsburg, PA 15317






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	 	Attention: Edward J. Borkowski
	 

	 	Telephone No.: 724-514-1870
	 

	 	Facsimile No.: 724-514-1871
	 
	 	 
	 

	 	Merrill Lynch Financial Centre
	 

	 	2 King Edward Street
	 

	 	London EC1A 1HQ
	 

	 	Attention: Manager, Fixed Income Settlements
	 

	 	Facsimile No.: +44 207 995 2004
	 

	 	Telephone No.: +44 207 995 3769
	 
	 	 
	Valuation:
	 	 
	 
	 	 
	Valuation Dates:

	 	Each Exercise Date
	 
	 	 
	Settlement Terms:
	 	 
	 
	 	 
	Cash Settlement:

	 	Applicable; provided that it shall be a condition of
Counterparty’s right to elect Cash Settlement that on
the date of the Cash Settlement election, none of
Counterparty, its directors, executive officers, or any
person controlling, or exercising influence over, its
decision to elect Cash Settlement is in possession of
any material non-public information with respect to
Counterparty or the Shares. If Counterparty elects to
settle the Transaction by Cash Settlement, Counterparty
represents and agrees that:
	 
	 	 
	 

	 	(i) Counterparty is not, on the date of the Cash Settlement election,
and will not be, on any day during the period from and including the
first Expiration Date to and including the final Expiration Date,
engaged in a distribution, as such term is used in Regulation M under
the Securities Exchange Act of 1934, as amended (the “Exchange
Act”); and
	 
	 	 
	 

	 	(ii) during the period from and including the first Expiration Date to and including the final
Expiration Date, without the prior written consent of MLI, the Counterparty shall not, and
shall cause its affiliates and affiliated purchasers (each as defined in Rule 10b-18 under the
Exchange Act) not to, directly or indirectly (including, without limitation, by means of a
derivative instrument) purchase, offer to purchase, place any bid or limit order that would
effect a purchase of, or commence any tender offer relating to, any Shares (or equivalent
interest, including a unit of beneficial interest in a trust or limited partnership or a
depository share) or any security convertible into or exchangeable for the Shares.
	 
	 	 
	Settlement Currency:

	 	USD
	 
	 	 
	Settlement Price:

	 	For each Valuation Date, the Volume Weighted Average Price of the Shares (“VWAP”) calculated
from 9:45 a.m. to 3:45 p.m., as observed under the heading Bloomberg VWAP on Bloomberg page
MYL.N <equity> VAP (or any successor thereto) (or if such volume-weighted average price
is unavailable, the market value of one Share on such Valuation Date, as determined by the
Calculation Agent); provided that if the scheduled weekday closing time of the Exchange for any
Valuation Date is later than 4:00 p.m. (without regard to after hours or any other trading
outside of the regular trading session hours) the






3









 






	 	 	 
	 

	 	VWAP shall be calculated for such Valuation Date from 9:45 a.m. until 15 minutes prior to such later closing time of the Exchange.
	 
	 	 
	 

	 	Section 6.3(a) of the Equity Definitions is hereby amended by replacing clause (ii) in its
entirety with “(ii) and Exchange Disruption, or” and inserting immediately following clause
(iii) the phrase “; in each case that the Calculation Agent determines is material.”
	 
	 	 
	Cash Settlement Payment Date:

	 	With respect to each Valuation Date, three (3) Currency Business Days after the final Valuation
Date.
	 
	 	 
	Settlement Method Election:

	 	Applicable with respect to Cash Settlement or Net Physical Settlement only.
	 
	 	 
	Electing Party:

	 	Counterparty
	 
	 	 
	Cash Settlement Method 

Election Date:

	 	The tenth (10th) Scheduled Trading Day immediately preceding the first Expiration
Date.
	 
	 	 
	Default Settlement Method:

	 	Net Physical Settlement
	 
	 	 
	Net Physical Settlement:

	 	In the event that the Counterparty elects to settle this Transaction by Net Physical
Settlement, subject to subject to “Conditions Relating to Net Physical Settlement” below,
Counterparty shall deliver to MLI on the Settlement Date a number of
Shares (the “Delivered
Shares”) equal to the Share Delivery Quantity,
provided that in the event that the number of
Shares calculated comprises any fractional Share, the Share Delivery Quantity shall be rounded
up or down to the nearest integral number of Shares, only whole Shares shall be delivered and
an amount in cash equal to the value of such fractional share shall be payable by the
Counterparty to MLI in lieu of such fractional Share.
	 
	 	 
	Share Delivery Quantity:

	 	For each Exercise Date, a number of Shares, as calculated by the Calculation Agent, equal to
the Net Physical Settlement Amount for such Exercise Date divided by the Settlement Price on
the Valuation Date in respect of such Settlement Date plus an amount in cash in lieu of any
fractional shares (based on the applicable Settlement Price).
	 
	 	 
	Net Physical Settlement Amount:

	 	For any Exercise Date, an amount equal to the product of (i) the Number of Warrants being
exercised on the relevant Exercise Date, (ii) the Strike Price Differential for such Exercise
Date and (iii) the Warrant Entitlement.
	 
	 	 
	Strike Price Differential:

	 	For any Valuation Date, (i) if the Settlement Price is greater than the Strike Price, an amount
equal to the excess of such Settlement Price over the Strike Price for such Valuation Date or
(ii) if such Settlement Price is less than or equal to the Strike Price, zero.
	 
	 	 
	Settlement Date:

	 	Settlement with respect to each Exercise Date shall occur on the third (3rd) Full
Exchange Business Day following the final Valuation Date, provided that MLI shall have the
right to request by prior written notice to Counterparty a Settlement Date with respect to any
Exercise Date and the related Share Delivery Quantity that is three (3) Full Exchange Business
Days following such Exercise Date. Such request shall not unreasonably be denied.






4









 






	 	 	 
	Conditions Relating to Net
	 	 
	Physical Settlement:

	 	If, on or before the 30th Business Day following delivery of Shares hereunder, MLI
notifies the Counterparty that MLI has reasonably determined after advice from counsel that
there is a considered risk that such Shares are subject to restrictions on transfer in the
hands of MLI pursuant to the rules and regulations promulgated under the Securities Act of
1933, as amended (“Securities Act”), then Counterparty shall either (i) deliver Shares that are
covered by an effective registration statement of Counterparty for immediate resale by MLI or
(ii) agree to deliver additional Shares in the amount and manner specified in sub-paragraph (B)
or (C), as applicable, hereto.
	 
	 	 
	 

	 	(A) If Counterparty elects to deliver Shares as described in above
clause (i), then promptly following such notification from MLI
	 
	 	 
	 

	 	(a) Counterparty shall afford MLI a reasonable opportunity to conduct
a due diligence investigation with respect to Counterparty that is
customary in scope for underwritten offerings of equity securities
registered for resale;
	 
	 	 
	 

	 	(b) Counterparty shall promptly file and use commercially reasonable
efforts to obtain the effectiveness of a registration statement for
immediate resale (the “Registration Statement”) in form and
content reasonably satisfactory to MLI and filed pursuant to Rule 415
under the Securities Act, and such prospectuses as MLI may reasonably
request to comply with the applicable prospectus delivery
requirements (the “Prospectus”) for the resale by MLI of such
number of Shares as MLI shall reasonably specify in accordance with
this paragraph, such Registration Statement to be effective and
Prospectus to be current until the earliest of the date on which (1)
all Delivered Shares have been sold by MLI, (2) MLI has advised
Counterparty that it no longer requires that such Registration
Statement be effective, (3) all remaining Delivered Shares could be
sold by MLI without registration pursuant to Rule 144 promulgated
under the Securities Act (the “Registration Period”) or (4)
Counterparty has provided a legal opinion of nationally recognized
counsel in form and substance satisfactory to MLI (with customary
assumptions and exceptions) that the Shares issuable upon exercise of
these Warrants will be freely tradable under the Securities Act upon
delivery to MLI and not subject to any legend restricting
transferability. It is understood that the Registration Statement
and Prospectus may cover a number of Shares equal to the aggregate
number of Shares (if any) reasonably estimated by MLI to be
potentially deliverable by Counterparty in connection with Net
Physical Settlement hereunder (not to exceed the Maximum Deliverable
Share Amount) and shall be subject to the same suspension of sales
during “blackout dates” as provided in the following paragraph; and
	 
	 	 
	 

	 	(c) Counterparty will enter into a registration rights agreement with
MLI in form and substance reasonably acceptable to MLI and
Counterparty (“Registration Rights Agreement”), which
agreement will contain among other things, customary representations
and warranties and indemnification, restrictions on sales during
“blackout dates”, provide for delivery of comfort letters, opinions
of counsel, due diligence rights and other rights relating to the
registration of a number of Shares equal to the number of Delivered
Shares and other Shares deliverable hereunder up to the Maximum
Deliverable Share Amount.
	 
	 	 
	 

	 	(d) Counterparty shall promptly pay to MLI a $0.04 per Share fee with
all Shares delivered in connection with Net Physical Settlement
pursuant to a Registration Statement.
	 
	 	 
	 

	 	(B) If Counterparty elects to deliver Shares as described in above
clause (ii), then promptly following such notification from MLI






5









 






	 	 	 
	 

	 	(a) Counterparty shall afford MLI and any potential institutional
purchaser of any Shares identified by MLI a reasonable opportunity to
conduct a due diligence investigation with respect to Counterparty
that is customary in scope for private placements of equity
securities by a publicly reporting company (if Counterparty is a
publicly reporting company at such time) to institutional purchasers
subject to execution of any customary confidentiality agreements;
	 
	 	 
	 

	 	(b) Counterparty shall enter into an agreement (a “Private
Placement Agreement”) with MLI on commercially reasonable terms
in connection with the private placement of such Shares by
Counterparty to MLI or an affiliate and the private resale of such
shares by MLI or such affiliate, substantially similar to private
placement purchase agreements customary for private placements of
equity securities by a publicly reporting company (if Counterparty is
a publicly reporting company at such time) to institutional
purchasers, in form and substance commercially reasonably
satisfactory to MLI and Counterparty, which Private Placement
Agreement shall include reasonable and customary provisions relating
to the indemnification of, and contribution in connection with the
liability of, MLI and its affiliates, shall provide for the payment
by Counterparty of all reasonable expenses in connection with such
resale, including all reasonable and documented fees and expenses of
counsel for MLI, shall contain representations, warranties and
agreements of Counterparty reasonably necessary or advisable to
establish and maintain the availability of an exemption from the
registration requirements of the Securities Act for such resales, and
shall use reasonable best efforts to provide for the delivery of
accountants’ “comfort letters” to MLI or such affiliate with respect
to the financial statements and certain financial information
contained in or incorporated by reference into any offering
memorandum prepared for the resale of such Shares;
	 
	 	 
	 

	 	(c) MLI shall sell the Delivered Shares in a commercially reasonable
manner, in good faith and in accordance with the terms and
limitations set forth in the Private Placement Agreement until the
amount received by MLI for the sale of the Shares (the “Proceeds
Amount”) is equal to the Net Physical Settlement Amount. Any
remaining Delivered Shares shall be returned to Counterparty. If the
Proceeds Amount is less than the Net Physical Settlement Amount,
Counterparty shall promptly deliver upon notice from MLI additional
Shares to MLI until the dollar amount from the sale of such Shares by
MLI equals the difference between the Net Physical Settlement Amount
and the Proceeds Amount. In no event shall Counterparty be required
to deliver to MLI a number of Shares greater than the Maximum
Deliverable Share Amount.
	 
	 	 
	 

	 	(C) Notwithstanding the foregoing: (I) if Counterparty has elected to
deliver Shares as described in clause (i) above and either (a)
Counterparty does not provide for the sale of the Shares under the
Registration Statement as provided in the Registration Rights
Agreement or (b) some Shares cannot be registered under the
Registration Statement due to Rule 415(a)(4) under the Securities
Act, then the provisions of sub-paragraph (B) shall apply to the
extent Counterparty has not satisfied its obligations hereunder by
the delivery of Shares pursuant to sub-paragraph (A). (II) If
sub-paragraph (B) is applicable and Counterparty fails to satisfy its
obligations under such sub-paragraph (B), then Counterparty may
deliver unregistered Shares of equivalent value to the Net Physical
Settlement Amount (or, if applicable, the unsatisfied portion
thereof). The value of any unregistered Shares so delivered shall be
discounted to reflect an appropriate liquidity discount (determined
by MLI in a commercially reasonable manner). (III) If some or all of
the Delivered Shares cannot be used to close out stock loans in the
shares of Counterparty entered into to establish or maintain short
positions by MLI in connection with this Transaction without a
prospectus being






6









 






	 	 	 
	 

	 	required by applicable law to be delivered to such lender, then the value of
any such Delivered Shares shall reflect an additional discount as determined by
MLI in good faith and in a commercially reasonable manner and the number of
Shares deliverable shall be correspondingly increased, except where, pursuant
to paragraph (A)(d) above, a $0.04 fee has been paid or is payable in respect
of such Delivered Shares. MLI and Counterparty agree that actual damages would
be difficult to ascertain under these circumstances and that the amount of
liquidated damages resulting from the determination in the preceding sentence
is a good faith estimate of such damages and not a penalty. In no event shall
Counterparty be required to top-up any delivery in cash or deliver to MLI a
number of Shares greater than the Maximum Deliverable Share Amount.
	 
	 	 
	Limitations on Net Physical 

Settlement by Counterparty:

	 	
Notwithstanding anything herein or in the
Agreement to the contrary, the number of
Shares that may be delivered at settlement by
Counterparty shall not exceed the product of
2.0 times the initial Number of Warrants at
any time (“Maximum Deliverable Share Amount”),
as adjusted by the Calculation Agent to
account for any subdivision, stock-split,
reclassification or similar dilutive event
with respect to the Shares.
	 
	 	 
	 

	 	Counterparty represents and warrants that the
number of Available Shares as of the Trade
Date is greater than the Maximum Deliverable
Share Amount. Counterparty covenants and
agrees that (i) Counterparty shall not take
any action of corporate governance or
otherwise to reduce the number of Available
Shares below the Maximum Deliverable Share and
(ii) Counterparty shall use its reasonable
efforts to cause the number of Available
Shares at all times to be greater than the
Maximum Deliverable Share Amount.
	 
	 	 
	 

	 	For this purpose, “Available Shares” means the
number of Shares Counterparty currently has
authorized (but not issued and outstanding)
less the maximum number of Shares that may be
required to be issued by Counterparty in
connection with stock options, convertibles,
and other commitments of Counterparty that may
require the issuance or delivery of Shares in
connection therewith.
	 
	 	 
	Dividends:
	 	 
	 
	 	 
	Dividends:

	 	If at any time during the period from and
including the Trade Date, to but excluding the
final Expiration Date, an ex-dividend date for
a cash dividend occurs with respect to the
Shares (an “Ex-Dividend Date”), and that
dividend is different from the Regular
Dividend on a per Share basis, then the
Calculation Agent will, in its reasonable
discretion, adjust the Strike Price, the
Number of Warrants, the Daily Number of
Warrants, the Warrant Entitlement and any
other variable it deems appropriate to
preserve the fair value of the Warrant after
taking into account such dividend.
	 
	 	 
	Regular Dividend:

	 	Initially USD 0.06 per Share per quarter in
respect of the Shares. In the event that, in
any quarter, a regular quarterly Ex-Dividend
Date occurs for which the amount of the
corresponding cash dividend is different (the
“New Dividend Amount”) from the Regular
Dividend or no Ex-Dividend Date occurs (in
which case the New Dividend Amount shall be
zero), then following the adjustment by the
Calculation Agent pursuant to “Dividends”
above, the Regular Dividend shall equal the
New Dividend Amount.
	 
	 	 
	Extraordinary Dividends:

	 	Any dividend other than Regular Dividends. For
the avoidance of doubt, if more than one
Ex-Dividend Date occurs in a quarter, the
Calculation Agent shall






7









 






	 	 	 
	 

	 	designate any cash dividend other than a Regular Dividend as an Extraordinary
Dividend and will, in its reasonable discretion, adjust the Strike Price, the
Number of Warrants, the Daily Number of Warrants, the Warrant Entitlement and
any other variable it deems appropriate to preserve the fair value of the
Warrant after taking into account such dividend.
	 
	 	 
	Adjustments:
	 	 
	 
	 	 
	Method of Adjustment:

	 	Calculation Agent Adjustment
	 
	 	 
	Extraordinary Events:
	 	 
	 
	 	 
	Consequences of Merger Events:

	 	(a) Share-for-Share: Cancellation and
Payment (subject to satisfaction by
delivery of Shares as set forth in “Early
Termination” below).
	 
	 	 
	 

	 	(b) Share-for-Other: Cancellation and Payment (subject to
satisfaction by delivery of Shares as set forth in “Early
Termination” below).
	 
	 	 
	 

	 	(c) Share-for-Combined: Cancellation and Payment (subject to
satisfaction by delivery of Shares as set forth in “Early
Termination” below).
	 
	 	 
	Tender Offer:

	 	Applicable
	 
	 	 
	Consequences of Tender Offers:

	 	(a) Share-for-Share: Cancellation and
Payment (subject to satisfaction by
delivery of Shares as set forth in “Early
Termination” below).
	 
	 	 
	 

	 	(b) Share-for-Other: Cancellation and Payment (subject to
satisfaction by delivery of Shares as set forth in “Early
Termination” below).
	 
	 	 
	 

	 	(c) Share-for-Combined: Cancellation and Payment (subject to
satisfaction by delivery of Shares as set forth in “Early
Termination” below).
	 
	 	 
	Nationalization, Insolvency 

or Delisting:

	 	Cancellation and Payment (subject to
satisfaction by delivery of Shares as set
forth in “Early Termination” below). In
addition to the provisions of Section
12.6(a)(iii) of the Equity Definitions, it
will also constitute a Delisting if the
Exchange is located in the United States
and the Shares are not immediately
re-listed, re-traded or re-quoted on any
of the New York Stock Exchange, the
American Stock Exchange or the NASDAQ
National Market System (or their
respective successors, including without
limitation the NASDAQ Global Market and
NASDAQ Global Select Market); if the
Shares are immediately re-listed,
re-traded or re-quoted on any such
exchange or quotation system, such
exchange or quotation system shall
thereafter be deemed to be the Exchange.
	 
	 	 
	Determining Party:

	 	As specified under “Early Termination”
	 
	 	 
	 

	 	For the avoidance of doubt, with respect
to any Extraordinary Events hereunder,
upon the occurrence of Cancellation and
Payment in whole or in part, the parties
agree that, notwithstanding anything to
the contrary in the Equity Definitions,
the provisions set forth in the Early
Termination section below shall apply.
	 
	 	 
	Additional Disruption Events:
	 	 






8









 






	 	 	 
	Change in Law:

	 	Applicable
	 
	 	 
	Failure to Deliver:

	 	Not Applicable
	 
	 	 
	Insolvency Filing:

	 	Applicable
	 
	 	 
	Hedging Disruption Event:

	 	Applicable
	 
	 	 
	Increased Cost of Hedging:

	 	Not Applicable
	 
	 	 
	Loss of Stock Borrow:

	 	Applicable; Section 12.9(b)(iv) of the
Equity Definitions is hereby amended by
deleting the text from and including “(A)”
to and including “(B)” and by deleting the
words “in each case”.
	 
	 	 
	Maximum Stock Loan Rate:

	 	1.0% 
	 
	 	 
	Increased Cost of Stock Borrow:

	 	Applicable; provided that it shall be a
condition to Counterparty’s right to make
the election described in clause (C) of
Section 12.9(b)(v) of the Equity
Definitions that on the date of such
election, none of Counterparty, its
directors, executive officers, or any
person controlling, or exercising
influence over, its decision to make such
election is in possession of any material
non-public information with respect to
Counterparty or the Shares; and provided
further that, if Counterparty timely makes
the election described in clause (A) or
(B) of Section 12.9(b)(v) of the Equity
Definitions, Counterparty shall thereafter
remain entitled to terminate the
Transaction pursuant to Section 12.9(b)(v)
of the Equity Definitions upon two
Scheduled Trading Days’ notice to MLI.
Section 12.9(b)(v) of the Equity
Definitions is hereby amended by deleting
the text from and including “(X)” to and
including “(Y)”.
	 
	 	 
	Initial Stock Loan Rate:

	 	0.25% 
	 
	 	 
	Hedging Party:

	 	MLI
	 
	 	 
	Determining Party:

	 	As specified under “Early Termination”
	 
	 	 
	Non-Reliance:

	 	Applicable
	 
	 	 
	Agreements and
Acknowledgments Regarding
Hedging Activities:

	 	Applicable
	 
	 	 
	Additional Acknowledgments:

	 	Applicable
	 
	 	 
	Other Provisions:
	 	 
	 
	 	 
	Additional Agreements:

	 	If Counterparty would be obligated (but
for the provisions of this paragraph) to
pay cash to MLI pursuant to the terms of
this Agreement for any reason, then such
payment obligation may be satisfied by the
delivery to MLI of a number of Shares
(whether registered or unregistered)
having a cash value equal to the amount of
such payment obligation (such number of
Shares to be delivered to be determined by
the Calculation Agent to determine the
number of Shares that could be sold by MLI
over a reasonable period of time to
realize the cash equivalent of such
payment obligation taking into account any
applicable discount (determined by the
Calculation Agent) to reflect any
restrictions on transfer as well as the
market value of the Shares). Settlement
relating to any






9









 






	 	 	 
	 

	 	delivery of Shares pursuant to this paragraph shall occur within a reasonable
period of time. The number of Shares delivered pursuant to this paragraph
shall not exceed the Maximum Deliverable Share Amount and shall be subject to
the provisions set forth in subsection (c) under “Additional Agreements,
Representations and Covenants of Counterparty, etc.” below.
	 
	 	 
	Early Termination:

	 	Notwithstanding Section 6(e) of the Agreement or
Sections 12.7 or 12.8 of the Equity Definitions, if,
with respect to the Transaction contemplated
hereunder, (A) an Early Termination Date with respect
to any Event of Default or any Termination Event, (B)
a Merger Date with respect to any Merger Event or
Tender Offer Date with respect to a Tender Offer, (C)
a Closing Date with respect to an event described in
Section 12.6 of the Equity Definitions, or (D) date
as of which the Transaction is, or is deemed to have
been, terminated or cancelled as a result of an
applicable Additional Disruption Event (any such
date, the “Relevant Date”) shall occur, then in lieu
of calculating any payments hereunder pursuant to
Section 6(e) of the Agreement or Sections 12.7 or
12.8 of the Equity Definitions, as applicable, (if a
calculation under such sections would otherwise be
required), the Calculation Agent shall determine in a
commercially reasonable manner, the number of Shares
deliverable by Counterparty to MLI on the following
basis:
	 
	 	 
	 

	 	(1) such Relevant Date shall be the sole Exercise Date hereunder and
Automatic Exercise shall be applicable to the unexercised Number of
Warrants (the “Unexpired Number”);
	 
	 	 
	 

	 	(2) the Settlement Method shall be Net Share Settlement;
	 
	 	 
	 

	 	(3) Counterparty shall deliver to MLI the Net Share Settlement Amount
on the Settlement Date with respect to such Relevant Date (“Early
Termination Stock Settlement”); provided that, if Counterparty is
delivering Shares as a result of a Merger Event, the Settlement Date
for such delivery will be immediately prior to the effective time of
the Merger Event and the Shares will be deemed delivered at such time
such that MLI will be a holder of the Shares prior to such effective
time;
	 
	 	 
	 

	 	(4) Net Share Settlement Amount shall mean (subject to the Maximum
Deliverable Share Amount) a number of Shares equal to the sum of (A)
the Share Delivery Quantity (as defined herein) and (B) the product
of (x) the additional Shares per Warrant (the “Additional
Shares”) determined by reference to the table attached as Annex A
hereto based on the date on which such Relevant Date occurs and the
VWAP Price on such date, (y) the Unexpired Number, and (z) the
Warrant Entitlement;
	 
	 	 
	 

	 	(5) with respect to the determination of Additional Shares, if the
actual VWAP Price is between two VWAP Price amounts in the table or
the Relevant Date is between two Relevant Dates in the table, the
Additional Shares shall be determined by a straight-line
interpolation between the number of Additional Shares set forth for
the next higher and next lower VWAP Price amounts and the two nearest
Relevant Dates, as applicable, based on a 365-day year; and
	 
	 	 
	 

	 	(6) with respect to any adjustment to the terms of the Transaction,
the Calculation Agent, shall correspondingly adjust the Additional
Shares and/or the VWAP Prices (each as set forth in the table in
Annex A hereto) as of any date of such adjustments; provided, for the
avoidance of doubt, that any such adjustments shall be made
consistently with the applicable provisions of this Confirmation and
the Equity Definitions. For the avoidance of doubt, any






10









 






	 	 	 
	 

	 	calculations made by the Calculation Agent with respect to this
Transaction pursuant to Section 11.2(c), Section 12.2(d) or Section
12.3(c) of the Equity Definitions may take into account the
Calculation Agent’s determination of the fair market value of the
Shares under the then prevailing circumstances.
	 
	 	 
	 

	 	On or prior to the Relevant Date, if so requested by MLI upon advice of
counsel, Counterparty shall (subject to its right to make the election
described in the immediately succeeding paragraph) enter into a registration
rights agreement with MLI in form and substance reasonably acceptable to MLI
and Counterparty (which agreement will contain among other things, reasonable
customary representations and warranties and indemnification, restrictions on
sales during “blackout dates”, and provide for delivery of comfort letters,
opinions of counsel, due diligence rights and other customary rights) and
Counterparty shall satisfy the conditions contained therein and Counterparty
shall file and use its commercially reasonable efforts to obtain the
effectiveness a Registration Statement pursuant to Rule 415 under the
Securities Act. If and when such Registration Statement shall have been
declared effective by the Securities and Exchange Commission, Counterparty
shall have made available to MLI such Prospectuses as MLI may reasonably
request to comply with the applicable prospectus delivery requirements for the
resale by MLI of such number of Shares as MLI shall specify (or, if greater,
the number of Shares that Counterparty shall specify). Such Registration
Statement shall be effective and Prospectus shall be current until the
earliest of the date on which (i) all Shares delivered by Counterparty in
connection with an Early Termination Date, (ii) MLI has advised Counterparty
that it no longer requires that such Registration Statement be effective,
(iii) all remaining Shares could be sold by MLI without registration pursuant
to Rule 144 promulgated under the Securities Act (the “Termination
Registration Period”) or (iv) Counterparty has provided a legal opinion of
nationally recognized counsel in form and substance satisfactory to MLI (with
customary assumptions and exceptions) that the Shares issuable upon exercise
of these Warrants will be freely tradable under the Securities Act upon
delivery to MLI and not subject to any legend restricting transferability. It
is understood that the Registration Statement and Prospectus will cover a
number of Shares equal to the number of Shares plus the aggregate number of
Shares (if any) reasonably estimated by MLI to be potentially deliverable by
Counterparty in connection with Early Termination Stock Settlement hereunder,
but in no event exceeding the Maximum Deliverable Share Amount. On each day
during the Termination Registration Period Counterparty shall represent that
each of its filings under the Securities Act, the Exchange Act or other
applicable securities laws that are required to be filed have been filed and
that, as of the respective dates thereof and as of the date of this
representation, they do not contain any untrue statement of a material fact or
omission of a material fact required to be stated therein or necessary to make
the statements made, in the light of the circumstances under which they were
made, not misleading.
	 
	 	 
	 

	 	If Counterparty elects not to deliver Shares subject to an effective
Registration Statement (or if some or all of the Shares delivered cannot be
used to close out stock loans in the shares of Counterparty entered into to
establish or maintain short positions by MLI in connection with this
Transaction without a prospectus being required by applicable law to be
delivered to such lender), the provisions of sub-paragraphs (B) and (C) set
forth above under “Conditions Relating to Net Physical Settlement” shall
apply, mutatis mutandis, as if the Net Physical Settlement Amount were the
Transaction Early Termination Amount. “Transaction Early
Termination Amount”
means the Net Share Settlement Amount multiplied by the Settlement Price. In
no event shall Counterparty be






11









 






	 	 	 	 	 
	 	 	required to deliver to MLI a number of Shares greater than the Maximum Deliverable Share Amount.
	 
	 	 	 	 
	Compliance With  Securities Laws:	 	Counterparty represents and agrees that it has complied, and will comply, in
connection with this Transaction and all related or contemporaneous sales and
purchases of Shares, with the applicable provisions of the Securities Act, the
Exchange Act and the rules and regulations promulgated thereunder, including,
without limitation, Rule 10b-5 and 13e and Regulation M under the Exchange
Act.
	 
	 	 	 	 
	 	 	Each party acknowledges that the offer and sale of the Transaction to it is
intended to be exempt from registration under the Securities Act by virtue of
Section 4(2) thereof. Accordingly, each party represents and warrants to the
other party that (i) it has the financial ability to bear the economic risk of
entering into the Transaction and is able to bear a total loss of its
investment, (ii) it is an “accredited investor” as that term is defined in
Regulation D as promulgated under the Securities Act and (iii) the disposition
of this Transaction and the Shares is restricted under this Confirmation, the
Securities Act and state securities laws.


Counterparty further represents and warrants that:
	 
	 	 	 	 
	 	 	(a) Counterparty is not entering into this Transaction to create
actual or apparent trading activity in the Shares (or any security
convertible into or exchangeable for Shares) or to raise or depress
or otherwise manipulate the price of the Shares (or any security
convertible into or exchangeable for Shares);
	 
	 	 	 	 
	 	 	(b) Counterparty represents and acknowledges that as of the date
hereof and without limiting the generality of Section 13.1 of the
Equity Definitions, MLI is not making any representations or
warranties with respect to the treatment of the Transaction under
FASB Statements 149 or 150, EITF Issue No. 00-19 (or any successor
issue statements) or under FASB’s Liabilities & Equity Project;
	 
	 	 	 	 
	 	 	(c) Counterparty is not, and after giving effect to the Transaction
contemplated hereby, will not be, an “investment company” as such
term is defined in the Investment Company Act of 1940, as amended.
	 
	 	 	 	 
	 	 	(d) As of the Trade Date and each date on which a payment or delivery
is made by Counterparty hereunder, (i) the assets of Counterparty at
their fair valuation exceed the liabilities of Counterparty,
including contingent liabilities; (ii) the capital of Counterparty is
adequate to conduct its business; and (iii) Counterparty has the
ability to pay its debts and other obligations as such obligations
mature and does not intend to, or believe that it will, incur debt or
other obligations beyond its ability to pay as such obligations
mature.
	 
	 	 	 	 
	Account Details:	 	Account for payments to Counterparty:	 	 
	 
	 	 	 	 
	 

	 	 	 	Huntington National Bank
	 

	 	 	 	ABA#:
	 

	 	 	 	A/C Name: Mylan Laboratories Inc.
	 

	 	 	 	A/C: 01411114335
	 
	 	 	 	 
	 	 	Account for payments to MLI:	 	 
	 
	 	 	 	 
	 

	 	 	 	Chase Manhattan Bank, New York







12










 





	 	 	 
	 

	 	ABA#: 021-000-021
	 

	 	FAO: ML Equity Derivatives
	 

	 	A/C: 066213118






	 	 	 
	 

	 	Account for delivery of Shares to MLI: [To be advised]
	 
	 	 
	Agreement Regarding Shares:

	 	
Counterparty agrees that, in respect of any Shares delivered to MLI, such Shares shall be, upon
such delivery, duly and validly authorized, issued and outstanding, fully paid and non-assessable
and subject to no adverse claims of any other party. The issuance of such Shares does not and will
not require the consent, approval, authorization, registration or qualification of any government
authority, except such as shall have been obtained on or before the delivery date of any Shares or
as may be required in connection with any Registration Statement relating to any Shares.
	 
	 	 
	Bankruptcy Rights:

	 	In the event of Counterparty’s bankruptcy, MLI’s rights in connection with this Transaction shall
not exceed those rights held by common shareholders. For the avoidance of doubt, the parties
acknowledge and agree that MLI’s rights with respect to any other claim arising from this
Transaction prior to Counterparty’s bankruptcy shall remain in full force and effect and shall not
be otherwise abridged or modified in connection herewith.
	 
	 	 
	Set-Off:

	 	Each party waives any and all rights it may have to set-off, whether arising under any agreement,
applicable law or otherwise.
	 
	 	 
	Transfer:

	 	Neither party may transfer its rights and delegate its obligations under this Transaction;
provided, however, that MLI may assign its rights and delegate its obligations hereunder, in whole
or in part, to any other person with prior consent of the Counterparty not to be unreasonably
withheld. Either party may assign its rights and delegate its obligations hereunder, in whole or
in part, to any other person (an “Assignee”) with the prior consent of the other party, effective
(the “Transfer Effective Date”) upon delivery to such party of an executed acceptance and
assumption by the Assignee (an “Assumption”) of the transferred obligations of the assigning party
under this Transaction (the “Transferred Obligations”). Notwithstanding any other provision in
this Confirmation to the contrary requiring or allowing MLI to purchase, sell, receive or deliver
any Shares or other securities to or from Counterparty, MLI may designate any of its affiliates to
purchase, sell, receive or deliver such Shares or other securities and otherwise to perform MLI’s
obligations in respect of this Transaction and any such designee may assume such obligations. MLI
shall be discharged of its obligations to Counterparty to the extent of any such performance.
	 
	 	 
	Regulation: 


Indemnity:

	 	MLI is regulated by The Securities
and Futures Authority Limited. 


Seller (the “Indemnifying Party”) agrees to indemnify MLI, its Affiliates and their respective
directors, officers, agents and controlling parties (each such person being an “Indemnified Party”)
from and against any and all losses, claims, damages and liabilities, joint and several, to which
such Indemnified Party may become subject because of a breach of any representation or covenant
hereunder, in the Agreement or any other agreement relating to the Agreement or Transaction and
will reimburse Indemnified Party for all reasonable expenses (including reasonable legal fees and
expenses) as they are incurred in connection with the investigation of, preparation for, or defense
of, any pending or threatened claim or any action or proceeding arising therefrom, whether or not






13









 






	 	 	 
	 

	 	such Indemnified Party is a party thereto. The Indemnifying Party will not be
liable under the foregoing Indemnity provision to the extent that any loss,
claim, damage, liability or expense is found in a final judgment by a court to
have resulted from an Indemnified Party’s gross negligence or willful
misconduct.
	 
	 	 
	Right to Extend:

	 	MLI may postpone, in whole or in part, any Expiration
Date or any other date of valuation or delivery with
respect to some or all of the relevant Warrants (in
which event the Calculation Agent shall make
appropriate adjustments to the Daily Number of
Warrants with respect to one or more Expiration
Dates) if MLI determines, in its commercially
reasonable judgment, that such extension is
reasonably necessary or appropriate to preserve MLI’s
hedging or hedge unwind activity hereunder in light
of existing liquidity conditions or to enable MLI to
effect purchases of Shares in connection with its
hedging, hedge unwind or settlement activity
hereunder in a manner that would, if MLI were Issuer
or an affiliated purchaser of Issuer, be in
compliance with applicable legal, regulatory or
self-regulatory requirements, or with related
policies and procedures applicable to MLI.






Additional Agreements, Representations and Covenants of Counterparty, Etc.:





	(a)	 	Counterparty hereby represents and warrants to MLI, on each day from the Trade Date to and
including the earlier of (i) March 17, 2007, and (ii) the date by which MLI is able to
initially complete a hedge of its position created by this Transaction, that:






	 	(1)	 	it will not, and will not permit any person or entity subject to its control
to, bid for or purchase Shares during such period except pursuant to transactions or
arrangements which have been approved by MLI or an affiliate of MLI; and
	 
	 	(2)	 	it has publicly disclosed all material information necessary for it to be able
to purchase or sell Shares in compliance with applicable federal securities laws.






	(b)	 	No collateral shall be required by either party for any reason in connection with this
Transaction.
	 
	(c)	 	Notwithstanding anything to the contrary herein, MLI shall not be entitled to exercise any
Warrant or take delivery of any Shares deliverable hereunder, and Automatic Exercise shall not
apply with respect to any Warrant, to the extent (but only to the extent) that after such
receipt of any Shares upon the exercise of such Warrant or otherwise hereunder MLI, or its
ultimate parent entity would, directly or indirectly, be the beneficial owner (as such term is
defined for purposes of Section 13(d) of the Exchange Act) at any time of more than 8.0
percent of the class of the Counterparty’s outstanding equity securities that is comprised of
the Shares (an “Excess Share Owner”).
	 
	 	 	MLI shall provide prior notice to Counterparty if the exercise of any Warrant or delivery of
Shares hereunder would cause MLI to become, directly or indirectly, an Excess Share Owner;
provided that the failure of MLI to provide such notice shall not alter the
effectiveness of the provisions set forth in the preceding sentence and any purported
exercise or delivery in violation of such provisions shall be void and have no effect. If
any delivery owed to MLI hereunder is not made, in whole or in part, as a result of this
provision, Counterparty’s obligation to make such delivery shall not be extinguished and
Counterparty shall make such delivery as promptly as practicable after MLI gives notice that
such delivery would not result in MLI being an Excess Share Owner; provided that any such
notice must be delivered by MLI no later than September 30, 2012.
	 
	 	 	If MLI is not entitled to exercise any Warrant because such exercise would cause MLI to
become, directly or indirectly, an Excess Share Owner and MLI thereafter disposes of Shares
owned by it or any action is taken that would then permit MLI to exercise such Warrant
without such exercise causing it to become,




14









 






	 	 	directly or indirectly, an Excess Share Owner, then MLI shall provide notice of the taking
of such action to Counterparty and such Warrant shall then become exercisable by MLI to the
extent such Warrant is otherwise or had otherwise become exercisable hereunder; provided
that any such notice must be delivered by MLI no later than September 30, 2012. In such
event, the Expiration Date with respect to such Warrant shall be the date on which
Counterparty receives such notice from MLI, and the related Settlement Date shall be as soon
as reasonably practicable after receipt of such notice but no more than three (3) Exchange
Business Days thereafter (but in no event shall the Settlement Date occur prior to the date
on which it would have otherwise occurred but for the provisions of this subsection);
provided that the related Net Physical Settlement Amount shall be the same as the
Net Physical Settlement Amount but for the provisions of this subsection. In addition,
within 30 calendar days of a Settlement Date, Counterparty shall use its reasonable efforts
to refrain from activities that could reasonably be expected to result in MLI’s ownership of
Shares exceeding 10% of all issued and outstanding Shares.





Matters Relating to Agent:





	1.	 	MLPFS will be responsible for the operational aspects of the Transactions effected through
it, such as record keeping, reporting, and confirming Transactions to Counterparty and MLI;
	 
	2.	 	Unless MLI is a “major U.S. institutional investor,” as defined in Rule 15a-6 of the Exchange
Act, neither Counterparty not MLI will contact the other without the direct involvement of
MLPFS;
	 
	3.	 	MLPFS’s sole role under this Agreement and with respect to any Transaction is as an agent of
Counterparty and MLI on a disclosed basis and MLPFS shall have no responsibility or liability
to Counterparty or MLI hereunder except for gross negligence or willful misconduct in the
performance of its duties as agent. MLPFS is authorized to act as agent for MLI, but only to
the extent expressly required to satisfy the requirements of Rule 15a-6 under the Exchange Act
in respect of the Options described hereunder. MLPFS shall have no authority to act as agent
for Counterparty generally or with respect to transactions or other matters governed by this
Agreement, except to the extent expressly required to satisfy the requirements of Rule 15a-6
or in accordance with express instructions from Counterparty.





ISDA Master Agreement:



With respect to the Agreement, MLI and Counterparty each agree as follows:



“Specified Entity” means in relation to Seller and in relation to Counterparty for purposes of this
Transaction: Not applicable.



The provisions of “Default under Specified Transaction” set forth in Section 5(a)(v) of the
Agreement shall not apply to MLI or Counterparty.



The “Cross Default” provisions of Section 5(a)(vi) of the Agreement shall not apply to MLI or
Counterparty.



The “Credit Event Upon Merger ” provisions of Section 5(b)(iv) of the Agreement
will not apply to MLI and Counterparty.



Additional Termination Event. If within the period commencing on the Trade Date and ending on the
second anniversary of the Premium Payment Date, Buyer reasonably determines that it is advisable to
terminate all or a portion of the Transaction so that Buyer’s related hedging activities will
comply with applicable securities laws, rules or regulations, (1) Buyer shall have the right to
designate such event an Additional Termination Event and designate an Early Termination Date
pursuant to Section 6(b) of the Agreement and (2) Seller shall be deemed the sole Affected Party
and the Transaction (or terminated portion thereof) shall be deemed the sole Affected Transaction.



The “Automatic Early Termination” provision of Section 6(a) of the Agreement will not apply
to MLI or to Counterparty.




15









 







Payments on Early Termination. For the purpose of Section 6(e) of the Agreement: (i) Loss
shall apply; and (ii) the Second Method shall apply.



“Termination Currency” means USD.




Tax Representations.





	(I)	 	Payer Representations. For the purpose of Section 3(e) of the Agreement, each party
represents to the other party that it is not required by any applicable law, as modified by
the practice of any relevant governmental revenue authority, of any Relevant Jurisdiction to
make any deduction or withholding for or on account of any Tax from any payment (other than
interest under Section 2(e), 6(d)(ii), or 6(e) of the Agreement) to be made by it to the other
party under the Agreement. In making this representation, each party may rely on (i) the
accuracy of any representations made by the other party pursuant to Section 3(f) of the
Agreement, (ii) the satisfaction of the agreement contained in Section 4(a)(i) or 4(a)(iii) of
the Agreement, and the accuracy and effectiveness of any document provided by the other party
pursuant to Section 4(a)(i) or 4(a)(iii) of the Agreement, and (iii) the satisfaction of the
agreement of the other party contained in Section 4(d) of the Agreement; provided that
it will not be a breach of this representation where reliance is placed on clause (ii) above
and the other party does not deliver a form or document under Section 4(a)(iii) of the
Agreement by reason of material prejudice to its legal or commercial position.
	 
	(II)	 	Payee Representations. For the purpose of Section 3(f) of the Agreement, each party makes
the following representations to the other party:






	 	(i)	 	MLI represents that it is a corporation organized under the laws of England and
Wales.
	 
	 	(ii)	 	Counterparty represents that it is a corporation incorporated in Pennsylvania.




Delivery Requirements. For the purpose of Sections 4(a)(i) and (ii) of the
Agreement, each party agrees to deliver the following documents:





	(a)	 	Tax forms, documents or certificates to be delivered are:
	 
	 	 	Each party agrees to complete (accurately and in a manner reasonably satisfactory to the
other party), execute, and deliver to the other party, United States Internal Revenue
Service Form W-9 or W-8 BEN, or any successor of such form(s): (i) before the first payment
date under this agreement; (ii) promptly upon reasonable demand by the other party; and
(iii) promptly upon learning that any such form(s) previously provided by the other party
has become obsolete or incorrect.
	 
	(b)	 	Other documents to be delivered:





	 	 	 	 	 	 	 
	 	 	 	 	 	 	Covered by
	Party Required to	 	 	 	 	 	Section 3(d)
	Deliver Document	 	Document Required to be Delivered	 	When Required	 	Representation
	Counterparty and MLI

	 	Evidence of the authority and
true signatures of each official
or representative signing this
Confirmation
	 	Upon or before the

Effective Date
	 	Yes
	 
	 	 	 	 	 	 
	Counterparty

	 	Certified copy of the resolution
of the Board of Directors or
equivalent document authorizing
the execution and delivery of
this Confirmation and such other
certificate or certificates as
MLI shall reasonably request
	 	Upon or before the

Effective Date
	 	Yes






16









 






	 	 	 	 	 	 	 
	Counterparty

	 	An opinion of counsel, dated as
of the Effective Date and
reasonably acceptable to MLI in
form and substance, with respect
to the matters set forth in
Section 3(a) of the Agreement
	 	Upon or before the

Effective Date
	 	No
	 
	 	 	 	 	 	 
	MLI

	 	Guarantee of its Credit Support
Provider, substantially in the
form of Exhibit A attached
hereto, together with evidence
of the authority and true
signatures of the signatories,
if applicable
	 	Upon or before the

Effective Date
	 	Yes





Addresses for Notices: For the purpose of Section 12(a) of the Agreement:



Address for notices or communications to MLI for all purposes:




	 	 	 	 	 
	 

	 	Address:
	 	Merrill Lynch International
	 

	 	 	 	Merrill Lynch Financial Centre
	 

	 	 	 	2 King Edward Street
	 

	 	 	 	London EC1A 1HQ
	 

	 	Attention:
	 	Manager, Fixed Income Settlements
	 

	 	Facsimile No.:
	 	44 207 995 2004
	 

	 	Telephone No.:
	 	44 207 995 3769





Address for notices or communications to Counterparty for all purposes:




	 	 	 	 	 
	 

	 	Address:
	 	1500 Corporate Drive,
	 

	 	 	 	Canonsburg, PA 15317
	 

	 	Attention:
	 	Edward J. Borkowski
	 

	 	Telephone No.:
	 	724-514-1870
	 

	 	Facsimile No.:
	 	724-514-1871





Process Agent: For the purpose of Section 13(c) of the Agreement, MLI appoints as its process agent:




	 	 	 	 	 
	 

	 	Address:
	 	Merrill Lynch, Pierce, Fenner & Smith Incorporated
	 

	 	 	 	222 Broadway, 16th Floor
	 

	 	 	 	New York, New York 10038
	 

	 	Attention:
	 	Litigation Department
	 
	 

	 	Counterparty does not appoint a Process Agent.





Multibranch Party. For the purpose of Section 10(c) of the Agreement: Neither MLI nor
Counterparty is a Multibranch Party.



Calculation Agent. The Calculation Agent is MLI. Upon the request of either party, the
Calculation Agent (or, in the case of a determination made by a party (including a party acting as
Determining Party or Hedging Party), such party) shall, no later than the 5th Business
Day following such request, provide the parties with a statement showing, in reasonable detail, the
computations (including any relevant quotations) by which it has determined any amount payable or
deliverable under, or any adjustment to the terms of, this Transaction. All judgments,
determinations and calculations hereunder by the Calculation Agent or by a party hereto shall be
performed in good faith and in a commercially reasonable manner.




Credit Support Document.



MLI:
Guarantee of ML & Co. in the form attached hereto as
Exhibit A.


17









 






Counterparty: Not Applicable



Credit Support Provider.



With respect to MLI: ML & Co.



With respect to Counterparty: Not Applicable.



Governing Law. This Confirmation will be governed by, and construed in accordance with, the laws
of the State of New York.



Waiver of Jury Trial. Each party waives, to the fullest extent permitted by applicable law, any
right it may have to a trial by jury in respect of any suit, action or proceeding relating to this
Transaction. Each party (i) certifies that no representative, agent or attorney of the other party
has represented, expressly or otherwise, that such other party would not, in the event of such a
suit, action or proceeding, seek to enforce the foregoing waiver and (ii) acknowledges that it and
the other party have been induced to enter into this Transaction, as applicable, by, among other
things, the mutual waivers and certifications provided herein.



Netting of Payments. The provisions of Section 2(c) of the Agreement shall not be
applicable to this Transaction.



Basic Representations. Section 3(a) of the Agreement is hereby amended by the deletion of
“and” at the end of Section 3(a)(iv); the substitution of a semicolon for the period at the
end of Section 3(a)(v) and the addition of Sections 3(a)(vi), as follows:





	 	 	 	Eligible Contract Participant; Line of Business. Each party agrees and represents
that it is an “eligible contract participant” as defined in Section 1a(12) of the
U.S. Commodity Exchange Act, as amended (“CEA”), this Agreement and the
Transaction thereunder are subject to individual negotiation by the parties and have
not been executed or traded on a “trading facility” as defined in Section 1a(33) of
the CEA, and it has entered into this Confirmation and this Transaction in
connection with its business or a line of business (including financial
intermediation), or the financing of its business.





Acknowledgements:





	(a)	 	The parties acknowledge and agree that there are no other representations, agreements or other
undertakings of the parties in relation to this Transaction, except as set forth in this
Confirmation.
	 
	(b)	 	The parties hereto intend for:






	 	(i)	 	Buyer to be a “financial institution” as defined in Section 101(22) of Title 11
of the United States Code (the “Bankruptcy Code”) and this Transaction to be a
“securities contract” as defined in Section 741(7) of the Bankruptcy Code and a “swap
Agreement” as defined in Section 101(53C) of the Bankruptcy Code, qualifying for the
protections of, among other sections, Sections 362(b)(6), 362(b)(17), 546(e), 546(g),
555 and 560 of the Bankruptcy Code;
	 
	 	(ii)	 	a party’s right to liquidate this Transaction and to exercise any other
remedies upon the occurrence of any Event of Default under the Agreement with respect
to the other party to constitute a “contractual right” as defined in the Bankruptcy
Code;
	 
	 	(iii)	 	all payments for, under or in connection with this Transaction, all payments
for the Shares and the transfer of such Shares to constitute “settlement payments” as
defined in the Bankruptcy Code.




Amendment of Section 6(d)(ii). Section 6(d)(ii) of the Agreement is modified by
deleting the words “on the day” in the second line thereof and substituting therefor “on the day
that is three Local Business Days after the day”.


18









 




Section 6(d)(ii) is further modified by
deleting the words “two Local Business Days” in the fourth line thereof and substituting therefor
“three Local Business Days.”


Amendment of Definition of Reference Market-Makers. The definition of “Reference Market-Makers” in
Section 14 is hereby amended by adding in clause (a) after the word “credit” and before the
word “and” the words “or to enter into transactions similar in nature to the Transactions.”



Consent to Recording. Each party consents to the recording of the telephone conversations of
trading and marketing personnel of the parties and their Affiliates in connection with this
Confirmation. To the extent that one party records telephone conversations (the “Recording Party”)
and the other party does not (the “Non-Recording Party”), the Recording Party shall in the event of
any dispute, make a complete and unedited copy of such party’s tape of the entire day’s
conversations with the Non-Recording Party’s personnel available to the Non-Recording Party. The
Recording Party’s tapes may be used by either party in any forum in which a dispute is sought to be
resolved and the Recording Party will retain tapes for a consistent period of time in accordance
with the Recording Party’s policy unless one party notifies the other that a particular transaction
is under review and warrants further retention.



Disclosure. Each party hereby acknowledges and agrees that MLI has authorized Counterparty to
disclose this Transaction and any related hedging transaction between the parties if and to the
extent that Counterparty reasonably determines (after consultation with MLI) that such disclosure
is required by law or by the rules of the New York Stock Exchange or any securities exchange.
Notwithstanding the foregoing, effective from the date of commencement of discussions concerning
the Transaction, Counterparty and each of its employees, representatives, or other agents may
disclose to any and all persons, without limitation of any kind, the tax treatment and tax
structure of the Transaction and all materials of any kind (including opinions or other tax
analyses) that are provided to Counterparty relating to such tax treatment and tax structure.



Severability. If any term, provision, covenant or condition of this Confirmation, or the
application thereof to any party or circumstance, shall be held to be invalid or unenforceable in
whole or in part for any reason, the remaining terms, provisions, covenants, and conditions hereof
shall continue in full force and effect as if this Confirmation had been executed with the invalid
or unenforceable provision eliminated, so long as this Confirmation as so modified continues to
express, without material change, the original intentions of the parties as to the subject matter
of this Confirmation and the deletion of such portion of this Confirmation will not substantially
impair the respective benefits or expectations of parties to this Agreement; provided,
however, that this severability provision shall not be applicable if any provision of
Section 2, 5, 6 or 13 of the Agreement (or any definition or
provision in Section 14 to the extent that it relates to, or is used in or in connection
with any such Section) shall be so held to be invalid or unenforceable.



Affected Parties. For purposes of Section 6(e) of the Agreement, each party shall be
deemed to be an Affected Party in connection with Illegality and any Tax Event.




[Signatures follow on separate page]




19









 





     Please confirm that the foregoing correctly sets forth the terms of our agreement by executing
the copy of this Confirmation enclosed for that purpose and returning it to us.



	 	 	 	 	 
	 	 	Very truly yours,
	 
	 	 	 	 
	 	 	MERRILL LYNCH INTERNATIONAL
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:	 	/s/ Authorized Signatory 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 






Confirmed as of the date first above written:



MYLAN LABORATORIES INC.




	 	 	 	 	 
	By:

	 	/s/ Edward J. Borkowski 	 	 
	 

	 	 	 	 
	Name:
	 	Edward J. Borkowski 	 	 
	Title:
	 	Chief Financial Officer 	 	 






Acknowledged and agreed as to matters to the Agent:

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,

Solely in its capacity as Agent hereunder




	 	 	 	 	 
	By:

	 	/s/ Brian Carrole 	 	 
	 

	 	 	 	 
	Name:
	 	 	 	 
	Title:
	 	 	 	 






OTC Warrant Confirmation





 









 








EXHIBIT A




GUARANTEE OF MERRILL LYNCH & CO., INC.




     FOR VALUE RECEIVED, receipt of which is hereby acknowledged, MERRILL LYNCH & CO., INC., a
corporation duly organized and existing under the laws of the State of Delaware (“ML & Co.”),
hereby unconditionally guarantees to Mylan Laboratories Inc. (the “Company”), the due and punctual
payment of any and all amounts payable by Merrill Lynch International, a company organized under
the laws of England and Wales (“ML”), under the terms of the Confirmation of OTC Warrant
Transaction between the Company and ML (ML as Buyer), dated as of March 1, 2007 (the
“Confirmation”), including, in case of default, interest on any amount due, when and as the same
shall become due and payable, whether on the scheduled payment dates, at maturity, upon declaration
of termination or otherwise, according to the terms thereof. In case of the failure of ML
punctually to make any such payment, ML & Co. hereby agrees to make such payment, or cause such
payment to be made, promptly upon demand made by the Company to ML & Co.; provided, however that
delay by the Company in giving such demand shall in no event affect ML & Co.’s obligations under
this Guarantee. This Guarantee shall remain in full force and effect or shall be reinstated (as
the case may be) if at any time any payment guaranteed hereunder, in whole or in part, is rescinded
or must otherwise be returned by the Company upon the insolvency, bankruptcy or reorganization of
ML or otherwise, all as though such payment had not been made.



     ML & Co. hereby agrees that its obligations hereunder shall be unconditional, irrespective of
the validity, regularity or enforceability of the Confirmation; the absence of any action to
enforce the same; any waiver or consent by the Company concerning any provisions thereof; the
rendering of any judgment against ML or any action to enforce the same; or any other circumstances
that might otherwise constitute a legal or equitable discharge of a guarantor or a defense of a
guarantor. ML covenants that this guarantee will not be discharged except by complete payment of
the amounts payable under the Confirmation. This Guarantee shall continue to be effective if ML
merges or consolidates with or into another entity, loses its separate legal identity or ceases to
exist.



     ML & Co. hereby waives diligence; presentment; protest; notice of protest, acceleration, and
dishonor; filing of claims with a court in the event of insolvency or bankruptcy of ML; all demands
whatsoever, except as noted in the first paragraph hereof; and any right to require a proceeding
first against ML.



     ML & Co. hereby certifies and warrants that this Guarantee constitutes the valid obligation of
ML & Co. and complies with all applicable laws.



     This Guarantee shall be governed by, and construed in accordance with, the laws of the State
of New York.



     This Guarantee may be terminated at any time by notice by ML & Co. to the Company given in
accordance with the notice provisions of the Confirmation, effective upon receipt of such notice by
the Company or such later date as may be specified in such notice; provided, however, that this
Guarantee shall continue in full force and effect with respect to any obligation of ML under the
Confirmation arising before or after such termination.



     This Guarantee becomes effective concurrent with the effectiveness of the Confirmation,
according to its terms.




21









 








     IN WITNESS WHEREOF, ML & Co. has caused this Guarantee to be executed in its corporate name by
its duly authorized representative.



	 	 	 	 	 	 	 
	 	 	MERRILL LYNCH & CO., INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Patricia Kropiewnicki 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Name:	 	Patricia Kropiewnicki 	 	 
	 

	 	Title:	 	Designated Signatory 	 	 
	 

	 	Date:	 	March 2, 2007 	 	 






Guarantee of OTC Warrant Confirmation





 









 








Annex A




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Time Value per Warrant - Net Additional Shares per Warrant
	VWAP	 	1-Sep-	 	1-Mar-	 	1-Sep-	 	1-Mar-	 	1-Sep-	 	1-Mar-	 	1-Sep-	 	1-Mar-	 	1-Sep-	 	8-Aug-
	Price	 	07	 	08	 	08	 	09	 	09	 	10	 	10	 	11	 	11	 	12
	 
	$  15.00
	 	 	0.255	 	 	 	0.232	 	 	 	0.208	 	 	 	0.181	 	 	 	0.153	 	 	 	0.121	 	 	 	0.087	 	 	 	0.050	 	 	 	0.015	 	 	 	0.000	 
	$  19.50
	 	 	0.294	 	 	 	0.275	 	 	 	0.256	 	 	 	0.234	 	 	 	0.210	 	 	 	0.183	 	 	 	0.153	 	 	 	0.116	 	 	 	0.068	 	 	 	0.000	 
	$  22.43
	 	 	0.292	 	 	 	0.274	 	 	 	0.256	 	 	 	0.235	 	 	 	0.213	 	 	 	0.188	 	 	 	0.160	 	 	 	0.128	 	 	 	0.088	 	 	 	0.000	 
	$  22.50
	 	 	0.292	 	 	 	0.274	 	 	 	0.255	 	 	 	0.235	 	 	 	0.213	 	 	 	0.188	 	 	 	0.160	 	 	 	0.128	 	 	 	0.088	 	 	 	0.000	 
	$  25.00
	 	 	0.580	 	 	 	0.540	 	 	 	0.500	 	 	 	0.457	 	 	 	0.409	 	 	 	0.178	 	 	 	0.148	 	 	 	0.112	 	 	 	0.070	 	 	 	0.000	 
	$  27.50
	 	 	0.356	 	 	 	0.331	 	 	 	0.305	 	 	 	0.277	 	 	 	0.247	 	 	 	0.213	 	 	 	0.175	 	 	 	0.130	 	 	 	0.076	 	 	 	0.000	 
	$  28.50
	 	 	0.370	 	 	 	0.344	 	 	 	0.319	 	 	 	0.291	 	 	 	0.261	 	 	 	0.227	 	 	 	0.190	 	 	 	0.144	 	 	 	0.089	 	 	 	0.000	 
	$  30.00
	 	 	0.389	 	 	 	0.364	 	 	 	0.339	 	 	 	0.312	 	 	 	0.282	 	 	 	0.249	 	 	 	0.211	 	 	 	0.166	 	 	 	0.111	 	 	 	0.000	 
	$  31.20
	 	 	0.404	 	 	 	0.379	 	 	 	0.355	 	 	 	0.328	 	 	 	0.299	 	 	 	0.265	 	 	 	0.228	 	 	 	0.183	 	 	 	0.129	 	 	 	0.000	 
	$  35.00
	 	 	0.338	 	 	 	0.315	 	 	 	0.292	 	 	 	0.266	 	 	 	0.239	 	 	 	0.208	 	 	 	0.173	 	 	 	0.131	 	 	 	0.080	 	 	 	0.000	 
	$  40.00
	 	 	0.276	 	 	 	0.255	 	 	 	0.234	 	 	 	0.211	 	 	 	0.186	 	 	 	0.157	 	 	 	0.126	 	 	 	0.089	 	 	 	0.047	 	 	 	0.000	 
	$  45.00
	 	 	0.232	 	 	 	0.213	 	 	 	0.194	 	 	 	0.172	 	 	 	0.150	 	 	 	0.124	 	 	 	0.097	 	 	 	0.066	 	 	 	0.032	 	 	 	0.000	 
	$  55.00
	 	 	0.175	 	 	 	0.158	 	 	 	0.142	 	 	 	0.125	 	 	 	0.107	 	 	 	0.087	 	 	 	0.066	 	 	 	0.043	 	 	 	0.021	 	 	 	0.000	 
	$  65.00
	 	 	0.139	 	 	 	0.126	 	 	 	0.112	 	 	 	0.098	 	 	 	0.083	 	 	 	0.067	 	 	 	0.050	 	 	 	0.033	 	 	 	0.017	 	 	 	0.000	 
	$  75.00
	 	 	0.116	 	 	 	0.104	 	 	 	0.093	 	 	 	0.081	 	 	 	0.068	 	 	 	0.055	 	 	 	0.042	 	 	 	0.028	 	 	 	0.014	 	 	 	0.000	 
	$  85.00
	 	 	0.100	 	 	 	0.089	 	 	 	0.079	 	 	 	0.069	 	 	 	0.058	 	 	 	0.047	 	 	 	0.036	 	 	 	0.024	 	 	 	0.013	 	 	 	0.000	 
	$  92.50
	 	 	0.090	 	 	 	0.081	 	 	 	0.072	 	 	 	0.062	 	 	 	0.053	 	 	 	0.043	 	 	 	0.033	 	 	 	0.022	 	 	 	0.012	 	 	 	0.000	 
	$100.00
	 	 	0.082	 	 	 	0.074	 	 	 	0.066	 	 	 	0.057	 	 	 	0.048	 	 	 	0.039	 	 	 	0.030	 	 	 	0.020	 	 	 	0.011	 	 	 	0.000	 






Guarantee of OTC Warrant Confirmation