Document:

EX-10.5

	 	 	 	 	 

Exhibit 10.5

MYLAN INC.

SEVERANCE PLAN

          The Company hereby adopts the Mylan Inc. Severance Plan for the benefit of certain employees
of the Company and its subsidiaries, on the terms and conditions hereinafter stated. All
capitalized terms used herein are defined in Section 1 hereof. The Plan, as set forth herein, is
intended to help retain qualified employees, maintain a stable work environment and provide
economic security to eligible employees in the event of certain terminations of employment. The
Plan, as a “severance pay arrangement” within the meaning of Section 3(2)(B)(i) of ERISA, is
intended to be excepted from the definitions of “employee pension benefit plan” and “pension plan”
set forth under section 3(2) of ERISA, and is intended to meet the descriptive requirements of a
plan constituting a “severance pay plan” within the meaning of regulations published by the
Secretary of Labor at Title 29, Code of Federal Regulations § 2510.3-2(b).

SECTION 1. DEFINITIONS. As hereinafter used:

          1.1 “Board” means the Board of Directors of the Company.

          1.2 “Cause” means (a) for purposes of a termination of employment (other than during
the Change in Control Protection Period): (i) the failure by the Eligible Employee to substantially
perform the Eligible Employee’s duties (other than any such failure resulting from the Eligible
Employee’s incapacity due to physical or mental illness), (ii) the continued failure by the
Eligible Employee to perform his duties at a satisfactory level of performance after written
notification from his or her manager or supervisor of such failure and after having been provided
with a reasonable opportunity to cure such failure, or (iii) the engaging by the Eligible Employee
in conduct which is injurious to the Company, monetarily or otherwise; and (b) for purposes of a
termination during the Change in Control Protection Period: (x) the willful and continued failure
by the Eligible Employee to substantially perform the Eligible Employee’s duties (other than any
such failure resulting from the Eligible Employee’s incapacity due to physical or mental illness)
or (y) the willful engaging by the Eligible Employee in conduct which is injurious to the Company,
monetarily or otherwise. For purposes of clause (b) above, no act, or failure to act, on the
Eligible Employee’s part shall be deemed “willful” unless done, or omitted to be done, by the
Eligible Employee not in good faith or without reasonable belief that the Eligible Employee’s act,
or failure to act, was in the best interests of the Company.

          1.3 A “Change in Control” shall be deemed to have occurred if the event set forth in
any one of the following paragraphs shall have occurred:

          (1) The acquisition by any individual, entity or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act or any successor
provision) of 20% or more of either (A) the then-outstanding shares of common stock of the
Company (the “Outstanding Company Common Stock”) or (B) the combined voting power of
the then-outstanding voting securities of the Company entitled to vote generally in the
election of directors (the “Outstanding Company Voting 

 

 

Securities”); provided, however, that, for purposes of this Section 1.4(1), the
following acquisitions shall not constitute a Change in Control: (i) any acquisition
directly from the Company or any of its subsidiaries, (ii) any acquisition by the Company or
any of its subsidiaries, (iii) any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by the Company or any subsidiary, (iv) any acquisition by a
Person that is permitted to, and actually does, report its beneficial ownership on Schedule
13G (or any successor schedule); provided that, if such Person subsequently becomes required
to or does report its beneficial ownership on Schedule 13D (or any successor schedule),
then, for purposes of this paragraph, such Person shall be deemed to have first acquired, on
the first date on which such Person becomes required to or does so report, beneficial
ownership of all of the Outstanding Company Common Stock and Outstanding Company Voting
Securities beneficially owned by it on such date or (v) any acquisition pursuant to a
transaction that complies with Section 1.3 (3)(A), (3)(B) and (3)(C); or

          (2)
Individuals who, as of the Effective Date, constitute the Board (the
“Incumbent
Board”) cease for any reason to constitute at least a majority of the Board; provided,
however, that any individual becoming a director subsequent to the Effective Date whose
election, or nomination for election by the Company’s shareholders, was approved by a vote
of at least two-thirds of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board; provided,
however, the term “Incumbent Board” as used in this Plan shall not include any such
individual whose initial assumption of office as a director occurs as a result of an actual
or threatened election contest with respect to the election or removal of directors or other
actual or threatened solicitation of proxies or consents by or on behalf of a Person other
than the Board; or

          (3) Consummation of a reorganization, merger, statutory share exchange or consolidation
or similar corporate transaction involving the Company or any of its subsidiaries, a sale or
other disposition of all or substantially all of the assets of the Company, or the
acquisition of assets or stock of another entity by the Company or any of its subsidiaries
(each, a “Business Combination”), in each case unless, following such Business
Combination, (A) the Outstanding Company Common Stock and the Outstanding Company Voting
Securities immediately prior to such Business Combination continue to represent (either by
remaining outstanding or being converted into voting securities of the resulting or
surviving entity or any parent thereof) more than 50% of the then-outstanding shares of
common stock and the combined voting power of the then-outstanding voting securities
entitled to vote generally in the election of directors, as the case may be, of the
corporation resulting from such Business Combination (including, without limitation, a
corporation that, as a result of such transaction, owns the Company or all or substantially
all of the Company’s assets either directly or through one or more subsidiaries), (B) no
Person (excluding any employee benefit plan (or related trust) of the Company or such
corporation resulting from such Business Combination) beneficially owns, directly or
indirectly, 20% or more of, respectively, the then-outstanding shares of common stock of the
corporation resulting from such Business Combination or the combined voting power of the
then-outstanding voting securities of such corporation, except to the extent that such
ownership existed prior to the Business Combination, and (C) individuals who comprise the
Incumbent Board immediately prior

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to such Business Combination constitute at least a majority of the members of the board
of directors of the corporation resulting from such Business Combination (including, without
limitation, a corporation that, as a result of such transaction, owns the Company or all or
substantially of the Company’s assets either directly or through one or more subsidiaries);
or

          (4) Approval by the shareholders of the Company of a complete liquidation or
dissolution of the Company.

          1.4 “Change in Control Protection Period” shall mean the period commencing on the date
a Change in Control occurs and ending on the 2nd anniversary of such date.

          1.5 “COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985, as from
time to time amended.

          1.6 “Code” means the Internal Revenue Code of 1986, as it may be amended from time to
time.

          1.7 “Company” means Mylan Inc. or any successors thereto.

          1.8 “Disability” means a physical or mental condition entitling the Eligible Employee
to benefits under the applicable long-term disability plan of the Company or any its subsidiaries,
or if no such plan exists, causing the Eligible Employee to be unable to substantially perform his
or her duties for at least 6 months in any 12-month period.

          1.9 “Effective Date” shall mean the date on which the Board adopts this Plan.

          1.10 “Eligible Employee” means, (i) for purposes of terminations of employment (other
than during the Change in Control Protection Period), any full-time employee of the Company or any
subsidiary thereof who has completed at least two (2) Years of Service with the Company or any
subsidiary prior to his or her Severance Date and (ii) for purposes of terminations of employment
during the Change in Control Protection Period, any full-time employee of the Company or any
subsidiary thereof; provided, however, that Eligible Employees shall not include (1) any employees
in respect of whom the Company has entered into a collective bargaining agreement, (2) any
individual who is a party to a written employment agreement or is eligible under any other plan,
policy or arrangement sponsored or maintained by the Company or any subsidiary (including but not
limited to an entity that may become a subsidiary after the Effective Date) thereof (other than a
Transition and Succession Agreement) that provides for severance payment and benefits upon
termination of employment, unless such individual elects to waive all severance payments and
benefits under such agreement, plan, policy or arrangement in connection with such individual’s
termination of employment or (3) any individual who is actually entitled (i.e., not just eligible)
to receive severance payments and benefits pursuant to a Transition and Succession Agreement with
the Company.

          1.11 “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

          1.12 “Exchange Act” means the Securities Exchange Act of 1934, as amended.

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          1.13 “Excise Tax” shall mean any excise tax imposed under section 4999 of the Code or
any successor provision thereto.

          1.14 “Good Reason” for a Tier I Employee or a Tier II Employee means (i) a material
adverse alteration in the nature or status of the employee’s responsibilities with the Company or
any subsidiary thereof from those in effect immediately prior to the Change in Control, (ii) a
reduction in the employee’s annual salary or target bonus opportunity from those in effect
immediately prior to the Change in Control, or (iii) a relocation of the employee’s principal place
of employment that causes the employee’s commute from his or her principal residence to the new
work location to increase by 30 miles or more. “Good Reason” for any other Eligible
Employee means (x) a reduction in the employee’s annual base salary or (y) a relocation of the
employee’s principal place of employment that causes the employee’s commute from his or her
principal residence to the new work location to increase by 30 miles or more.

          1.15 “Plan” means the Mylan Inc. Severance Plan, as set forth herein, as it may be
amended from time to time.

          1.16 “Plan Administrator” means the person or persons appointed from time to time by
the Board which appointment may be revoked at any time by the Board.

          1.17 A “Potential Change in Control” shall be deemed to have occurred if the event set
forth in any one of the following paragraphs shall have occurred:

          (1) The Company enters into a definitive agreement, the consummation of which would
result in the occurrence of a Change in Control;

          (2) Any Person (other than the Company or any of its subsidiaries) commences (within
the meaning of Regulation 14D promulgated under the Exchange Act or any successor
regulation) a tender or exchange offer which, if consummated, would result in a Change in
Control;

          (3) Any Person (other than the Company or any of its subsidiaries) files with the
Securities and Exchange Commission a preliminary or definitive proxy statement relating to
an election contest with respect to the election or removal of directors of the Company
which solicitation, if successful, would result in a Change in Control;

          (4) The acquisition by any Person of beneficial ownership (within the meaning of Rule
13d-3 promulgated under the Exchange Act or any successor provision) of 15% or more of
either (A) the Outstanding Company Common Stock or (B) the combined voting power of the
Outstanding Company Voting Securities; provided, however, that, for purposes of this Section
1.17, the following acquisitions shall not constitute a Potential Change in Control: (i) any
acquisition directly from the Company or any of its subsidiaries, (ii) any acquisition by
the Company or any of its subsidiaries, (iii) any acquisition by any employee benefit plan
(or related trust) sponsored or maintained by the Company or any subsidiary; or (iv) any
acquisition by a Person that is permitted to, and actually does, report its beneficial
ownership on Schedule 13G (or any successor schedule); provided that, if such Person
subsequently becomes required to or

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does report its beneficial ownership on Schedule 13D (or any successor schedule), and
at the time has beneficial ownership of 15% or more of either the Outstanding Company Common
Stock or the combined voting power of the Outstanding Company Voting Securities, then a
Potential Change in Control shall be deemed to occur at such time; or

          (5) The Board adopts a resolution to the effect that a Potential Change in Control has
occurred.

          1.18 “Severance” means (1) the involuntary termination of an Eligible Employee’s
employment by the Company or any subsidiary thereof other than for Cause, death or Disability or
(2) a voluntary termination of an Eligible Employee’s employment for Good Reason during the Change
in Control Protection Period; provided, however, that a Severance shall not occur by reason of the
divestiture of a facility, sale of a business or business unit, or the outsourcing of a business
activity with which the Eligible Employee is affiliated if the Eligible Employee is offered
comparable employment by the entity which acquires such facility, business or business unit or
which succeeds to such outsourced business activity.

          1.19 “Severance Date” means the date on which an Eligible Employee incurs a Severance.

          1.20 “Tier I Employee” means an Eligible Employee in Pay Grade 17 or higher,
determined as of the Severance Date, or any other Eligible Employee designated by the Company as a
Tier I Employee.

          1.21 “Tier II Employee” means an Eligible Employee in Pay Grades 13 through 16,
determined as of the Severance Date, or any other Eligible Employee designated by the Company as a
Tier II Employee.

          1.22 “Tier III Employee” means an Eligible Employee in Pay Grade 7 through 12,
determined as of the Severance Date, or any other Eligible Employee designated by the Company as a
Tier III Employee.

          1.23 “Tier IV Employee” means an Eligible Employee in Pay Grades 5 through 6,
determined as of the Severance Date, or any other Eligible Employee designated by the Company as a
Tier IV Employee.

          1.24 “Tier V Employee” means an Eligible Employee who is not, as of his or her
Severance Date, a Tier I Employee, Tier II Employee, Tier III Employee, or Tier IV Employee.

          1.25 “Years of Service” shall mean an Eligible Employee’s number of continuous years
of employment with the Company and/or any subsidiary thereof since the Employee’s most recent hire
date. In computing Years of Service, a period between six full months of employment and one year
shall be deemed to be one full year, and a period of less than six full months shall be deemed to
be zero years. For example, nine years and six months will be deemed to be ten Years of Service
while nine years and anything less than six full months will be deemed to be nine Years of Service.
During the Change in Control Protection Period,

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any Eligible Employee who has fewer than two Years of Service since his or her most recent
hire date will be deemed to have two Years of Service for purposes of this Plan.

			
	SECTION 2.	 	SEVERANCE BENEFITS (OTHER THAN DURING CHANGE IN CONTROL PROTECTION PERIOD).

          2.1 Tier I Employees. Each Tier I Employee who incurs a Severance other than during a
Change in Control Protection Period shall be entitled to (i) continuation of his or her annual base
salary, as in effect on the Severance Date, for a number of months equal to his or her Years of
Service, but with a minimum of nine (9) months and a maximum of twelve (12) months, (ii) a monthly
payment for the number of months he or she receives salary continuation pursuant to this Section
2.1 (or would have received such payments if the Company had not elected to make a lump sum payment
pursuant to Section 2.7), in an amount equal to the cost of premiums for continuation of coverage
under COBRA for such employee and his eligible dependents; provided, however, that payments
otherwise due to such Eligible Employee shall cease to the extent benefits of the same type are
received by or made available to such Eligible Employee by a subsequent employer, and (iii)
outplacement services for up to twelve (12) months following the Severance Date.

          2.2 Tier II Employees. Each Tier II Employee who incurs a Severance other than during
the Change in Control Protection Period shall be entitled to (i) continuation of his or her annual
base salary, as in effect on the Severance Date, for a number of months equal to his or her Years
of Service, but with a minimum of six (6) months and a maximum of nine (9) months, (ii) a monthly
payment for the number of months he or she receives salary continuation pursuant to this Section
2.2 (or would have received such payments if the Company had not elected to make a lump sum payment
pursuant to Section 2.7), in an amount equal to the cost of premiums for continuation of coverage
under COBRA for such employee and his eligible dependents; provided, however, that payments
otherwise due to such Eligible Employee shall cease to the extent benefits of the same type are
received by or made available to such Eligible Employee by a subsequent employer, and (iii)
outplacement services for up to nine (9) months following the Severance Date.

          2.3 Tier III and IV Employees. Each Tier III Employee and Tier IV Employee who incurs
a Severance other than during a Change in Control Protection Period shall be entitled to (i)
continuation of his or her annual base salary, as in effect on the Severance Date, for a number of
months equal to his or her Years of Service, but with a minimum of three (3) months and a maximum
of six (6) months and (ii) a monthly payment for the number of months he or she receives salary
continuation pursuant to this Section 2.3 (or would have received such payments if the Company had
not elected to make a lump sum payment pursuant to Section 2.7), in an amount equal to the cost of
premiums for continuation of coverage under COBRA for such employee and his eligible dependents;
provided, however, that payments otherwise due to such Eligible Employee shall cease to the extent
benefits of the same type are received by or made available to such Eligible Employee by a
subsequent employer. In addition, each Tier III Employee shall be provided with outplacement
services for a number of months equal to the number of months during which he or she is receiving
salary continuation payments (or would have received such payments if the Company had not elected to make a lump sum payment pursuant
to Section 2.7).

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          2.4 Tier V Employees. Each Tier V Employee who incurs a Severance other than during a
Change in Control Protection Period shall be entitled to (i) continuation of his or her annual base
salary, as in effect on the Severance Date, for a number of months equal to his or her Years of
Service, but with a minimum of two (2) months and a maximum of four (4) months and (ii) a monthly
payment for the number of months he or she receives salary continuation pursuant to this Section
2.4 (or would have received such payments if the Company had not elected to make a lump sum payment
pursuant to Section 2.7), in an amount equal to the cost of premiums for continuation of coverage
under COBRA for such employee and his eligible dependents; provided, however, that payments
otherwise due to such Eligible Employee shall cease to the extent benefits of the same type are
received by or made available to such Eligible Employee by a subsequent employer.

          2.5 Release. Notwithstanding the foregoing, as a condition to the receipt of any
payment pursuant to the applicable provision of this Section 2, each Eligible Employee shall be
required to execute and not revoke (within the seven (7) day revocation period) a Separation
Agreement provided by the Company which contains a general release of claims in favor of the
Company. Such release and waiver of claims must be signed within twenty-one (21) days (or such
longer period as mandated by applicable employment laws) following the Eligible Employee’s
Severance Date.

          2.6 Time of Payments. Subject to Section 7.11 hereof, all payments required to be
made hereunder to an Eligible Employee shall be made or shall commence on the thirtieth
(30th) day following the Eligible Employee’s Severance Date, or, if later, on the eighth
(8th) day following the expiration of the release consideration period required by
applicable law; provided, however, that in each case the release contemplated by
Section 2.5 has been executed and has become non-revocable prior to any payment hereunder.

          2.7 Lump Sum Payment. The Company may, in its sole discretion, elect to pay severance
benefits hereunder in a lump sum but only to the extent permissible under, and then only in
accordance with the requirements of, Section 409A of the Code.

SECTION 3. CHANGE IN CONTROL SEVERANCE BENEFITS.

          3.1 Generally. Subject to Section 3.7 and Section 5 hereof, Eligible Employees shall
be entitled to severance benefits pursuant to the applicable provisions of this Section 3 if they
incur a Severance during the Change in Control Protection Period. For purposes of calculating
severance benefits pursuant to this Section 3, any reduction in an Employee’s annual base salary or
annual target bonus during the Change in Control Protection Period shall be disregarded.

          3.2 Tier I Employees. Subject to Section 3.7 and Section 5 hereof, the Company shall
pay to each Tier I Employee who incurs a Severance during the Change in Control Protection Period a lump sum payment equal to two (2) times the sum of his or her then
annual base salary plus his or her annual target bonus for the year in which the Severance occurs.

          3.3 Tier II, III, IV and V Employees. Subject to Section 3.7 and Section 5 hereof,
the Company shall pay to each Tier II Employee, Tier III Employee, Tier IV Employee

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and Tier V
Employee who incurs a Severance during the Change in Control Protection Period a lump sum payment
equal to two times the sum of all monthly severance payments the employee would have received under
the applicable provisions of Section 2 hereof if his or her employment was terminated by the
Company other than for Cause, death or Disability prior to the Change in Control Protection Period.
For the avoidance of doubt, such payment shall not include an amount in respect of COBRA premiums.

          3.4 Health & Dental Benefit Continuation. Subject to Section 3.7 and Section 5
hereof, in the case of each Eligible Employee who incurs a Severance during the Change in Control
Protection Period, commencing on the date immediately following such Eligible Employee’s Severance
Date and continuing for the period set forth below (the “Welfare Benefit Continuation
Period”), the Company shall provide to each such Eligible Employee and anyone entitled to claim
under or through such employee all Company-paid benefits under any group health plan and dental
plan of the Company (as in effect immediately prior to such employee’s Severance Date or, if more
favorable to such employee, immediately prior to the Change in Control) for which employees of the
Company are eligible, to the same extent as if such employee had continued to be an employee of the
Company during the Welfare Benefit Continuation Period. To the extent that such employee’s
participation in Company benefit plans is not practicable, the Company shall arrange to provide, at
the Company’s sole expense, such employee and anyone entitled to claim under or through such
employee with equivalent health and dental benefits under an alternative arrangement during the
Welfare Benefit Continuation Period. The coverage period for purposes of the group health
continuation requirements of Section 4980B of the Code shall commence at the expiration of the
Welfare Benefit Continuation Period. The Welfare Benefit Continuation Period shall be twenty-four
(24) months for each Tier I Employee who incurs a Severance during the Change in Control Protection
Period and, for each other Eligible Employee who incurs a Severance during the Change in Control
Protection Period, shall be a number of months equal to two times the number of months he or she
would have received salary continuation pursuant to the applicable provisions of Section 2 hereof
if his or her employment was terminated by the Company prior to the Change in Control other than
for Cause, death or Disability.

          3.5 Outplacement Services. Subject to Section 3.7 and Section 5 hereof, each Tier I
Employee, Tier II Employee, Tier III Employee and Tier IV Employee who incurs a Severance during
the Change in Control Protection Period shall be provided with outplacement services as if such
employee had been terminated prior to the Change in Control Protection Period and had been entitled
to receive outplacement benefits pursuant to the applicable provisions of Section 2 hereof
(determined without regard to any service requirement).

          3.6 Legal Fees. The Company shall reimburse each Eligible Employee whose termination
of employment occurs during the Change in Control Protection Period for all reasonable legal fees
and expenses incurred by such Eligible Employee in seeking to obtain or enforce any right or
benefit provided under Section 3 of this Plan (other than any such fees and expenses incurred in pursuing any claim determined by an arbitrator or by a court of competent
jurisdiction to be frivolous or not to have been brought in good faith).

          3.7 Release. No Eligible Employee who incurs a Severance during the Change in Control
Protection Period shall be eligible to receive any payments or other benefits

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under the Plan unless
he or she first executes a written release substantially in the form attached hereto as Schedule A
and does not revoke such release within the time permitted therein for such revocation. Such
release and waiver of claims must be signed within twenty-one (21) days (or such longer period as
mandated by applicable employment laws) following the Eligible Employee’s Severance Date.

          3.8 Payment of Benefits. Subject to Section 7.11 hereof, all payments required to be
made hereunder to an Eligible Employee shall be made in a cash lump sum on the thirtieth
(30th) day following the Eligible Employee’s Severance Date, or, if later, on the eighth
(8th) day following the expiration of the release consideration period required by
applicable law; provided, however, that in each case the release contemplated by
Section 3.7 has been executed and has become non-revocable prior to any payment hereunder.
Notwithstanding the above, to the extent the Eligible Employee incurs a Severance following a
Change in Control but prior to a change in ownership or control of the Company within the meaning
of Section 409A of the Code, amounts payable to any Eligible Employee hereunder, to the extent not
in excess of the amount that the Eligible Employee would have received under Section 2 of this Plan
or any other pre-Change-in-Control severance plan or arrangement with the Company had such plan or
arrangement been applicable, shall be paid at the time and in the manner provided by such plan or
arrangement and the remainder shall be paid to the Eligible Employee in accordance with the
provisions of this Section 3.8.

SECTION 4. PLAN ADMINISTRATION.

          4.1 The Plan Administrator shall administer the Plan and may interpret the Plan, prescribe,
amend and rescind rules and regulations under the Plan and make all other determinations necessary
or advisable for the administration of the Plan, subject to all of the provisions of the Plan.

          4.2 The Plan Administrator may delegate any of its duties hereunder to such person or persons
from time to time as it may designate.

          4.3 The Plan Administrator is empowered, on behalf of the Plan, to engage accountants, legal
counsel and such other personnel as it deems necessary or advisable to assist it in the performance
of its duties under the Plan. The functions of any such persons engaged by the Plan Administrator
shall be limited to the specified services and duties for which they are engaged, and such persons
shall have no other duties, obligations or responsibilities under the Plan. Such persons shall
exercise no discretionary authority or discretionary control respecting the management of the Plan.
All reasonable expenses thereof shall be borne by the Company.

SECTION 5. EXCISE TAX.

          If any payment or benefit received or to be received by an Eligible Employee (including any
payment or benefit received pursuant to the Plan or otherwise) would be (in whole or part) subject
to the excise tax described in Section 4999 of Code, then, to the extent necessary to make such
payments and benefits not subject to such excise tax, payments and benefits provided hereunder
shall be reduced by the Plan Administrator in consultation with the Eligible Employee.

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SECTION 6. PLAN MODIFICATION OR TERMINATION.

          The Plan may be amended or terminated by the Board at any time; provided, however, that (i) no
termination or amendment may reduce the benefits or payments under the Plan to an Eligible Employee
if the Eligible Employee’s Severance Date has occurred prior to such termination or amendment and
(ii) during the pendency of the Potential Change in Control (and for a period of six months
thereafter), as well as during the Change in Control Protection Period, the Plan may not be
terminated, nor may the Plan be amended if such amendment would in any manner be adverse to the
interests of any Eligible Employee (it being understood, however, that clause (ii) shall not
preclude the Plan from being amended to bring it into compliance with Section 409A of the Code).
During the periods referred to in clause (ii) of the preceding sentence, but not during any other
period, any reduction in an Eligible Employee’s Pay Grade or any redesignation of any such employee
to a less favorable tier shall be disregarded for purposes of the Plan.

SECTION 7. GENERAL PROVISIONS.

          7.1 Except as otherwise provided herein or by law, no right or interest of any Eligible
Employee under the Plan shall be assignable or transferable, in whole or in part, either directly
or by operation of law or otherwise, including without limitation by execution, levy, garnishment,
attachment, pledge or in any manner; no attempted assignment or transfer thereof shall be
effective; and no right or interest of any Eligible Employee under the Plan shall be liable for, or
subject to, any obligation or liability of such Eligible Employee. When a payment is due under
this Plan to a severed employee who is unable to care for his or her affairs, payment may be made
directly to his or her legal guardian or personal representative.

          7.2 If the Company or any subsidiary thereof is obligated by law or by contract to pay
severance pay, a termination indemnity, notice pay, or the like, or if the Company or any
subsidiary thereof is obligated by law to provide advance notice of separation (“Notice
Period”), then any severance pay hereunder shall be reduced by the amount of any such severance
pay, termination indemnity, notice pay or the like, as applicable, and by the amount of any
compensation received during any Notice Period.

          7.3 Neither the establishment of the Plan, nor any modification thereof, nor the creation of
any fund, trust or account, nor the payment of any benefits shall be construed as giving any
Eligible Employee, or any person whomsoever, the right to be retained in the service of the Company
or any subsidiary thereof, and all Eligible Employees shall remain subject to discharge to the same
extent as if the Plan had never been adopted.

          7.4 If any provision of this Plan shall be held invalid or unenforceable, such invalidity or
unenforceability shall not affect any other provisions hereof, and this Plan shall be construed and
enforced as if such provisions had not been included.

          7.5 This Plan shall inure to the benefit of and be binding upon the heirs, executors,
administrators, successors and assigns of the parties, including each Eligible Employee, present
and future, and any successor to the Company. If a severed employee shall die while any amount
would still be payable to such severed employee hereunder if the severed

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employee had continued to
live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the
terms of this Plan to the executor, personal representative or administrators of the severed
employee’s estate.

          7.6 The headings and captions herein are provided for reference and convenience only, shall
not be considered part of the Plan, and shall not be employed in the construction of the Plan.

          7.7 The Plan shall not be funded. No Eligible Employee shall have any right to, or interest
in, any assets of any Company which may be applied by the Company to the payment of benefits or
other rights under this Plan.

          7.8 Any notice or other communication required or permitted pursuant to the terms hereof shall
have been duly given when delivered or mailed by United States Mail, first class, postage prepaid,
addressed to the intended recipient at his, her or its last known address.

          7.9 This Plan shall be construed and enforced according to the laws of the Commonwealth of
Pennsylvania to the extent not preempted by federal law, which shall otherwise control.

          7.10 All benefits hereunder shall be reduced by applicable withholding and shall be subject to
applicable tax reporting, as determined by the Plan Administrator.

          7.11 Conditions to Payment and Acceleration; Section 409A of the Code. The intent of
the parties is that payments and benefits under this Plan comply with Section 409A of the Code to
the extent subject thereto, and, accordingly, to the maximum extent permitted, this Plan shall be
interpreted and administered to be in compliance therewith. Notwithstanding anything contained
herein to the contrary, to the extent required in order to avoid accelerated taxation and/or tax
penalties under Section 409A of the Code, the Eligible Employee shall not be considered to have
terminated employment with the Company for purposes of this Plan and no payments shall be due to
the Eligible Employee under this Plan until such Eligible Employee would be considered to have
incurred a “separation from service” from the Company within the meaning of Section 409A of the
Code. For purposes of this Plan, each amount to be paid or benefit to be provided shall be
construed as a separate identified payment for purposes of Section 409A of the Code, and any payments described herein that are due within the “short term
deferral period” as defined in Section 409A of the Code shall not be treated as deferred
compensation unless applicable law requires otherwise. To the extent required in order to avoid
accelerated taxation and/or tax penalties under Section 409A of the Code, amounts that would
otherwise be payable and benefits that would otherwise be provided pursuant to this Plan during the
six-month period immediately following the Eligible Employee’s termination of employment shall
instead be paid on the first business day after the date that is six months following the Eligible
Employee’s termination of employment (or death, if earlier). To the extent required to avoid an
accelerated or additional tax under Section 409A of the Code, amounts reimbursable to the Eligible
Employee under this Plan shall be paid to the Eligible Employee on or before the last day of the
year following the year in which the expense was incurred and the amount of expenses eligible for
reimbursement (and in-kind benefits provided to the Eligible Employee) during any one year may not
effect amounts reimbursable or provided in any subsequent year; provided,

11

 

however,
that with respect to any reimbursements for any taxes which the Eligible Employee would become
entitled to under the terms of the Plan, the payment of such reimbursements shall be made by the
Company no later than the end of the calendar year following the calendar year in which the
Eligible Employee remits the related taxes.

SECTION 8. CLAIMS, INQUIRIES, APPEALS.

          8.1 Applications for Benefits and Inquiries. Any application for benefits, inquiries
about the Plan or inquiries about present or future rights under the Plan must be submitted to the
Plan Administrator in writing, as follows:

Plan Administrator

c/o Mylan Inc.

1500 Corporate Drive

Canonsburg, PA 15317

          8.2 Denial of Claims. In the event that any application for benefits is denied in
whole or in part, the Plan Administrator must notify the applicant, in writing, of the denial of
the application, and of the applicant’s right to review the denial. The written notice of denial
will be set forth in a manner designed to be understood by the employee, and will include specific
reasons for the denial, specific references to the Plan provision upon which the denial is based, a
description of any information or material that the Plan Administrator needs to complete the
review, and an explanation of the Plan’s review procedure.

          This written notice will be given to the employee within ninety (90) days after the Plan
Administrator receives the application, unless special circumstances require an extension of time,
in which case, the Plan Administrator has up to an additional ninety (90) days for processing the
application. If an extension of time for processing is required, written notice of the extension
will be furnished to the applicant before the end of the initial ninety (90)-day period.

          This notice of extension will describe the special circumstances necessitating the additional
time and the date by which the Plan Administrator is to render his or her decision on the
application. If written notice of denial of the application for benefits is not furnished within
the specified time, the application shall be deemed to be denied. The applicant will then be
permitted to appeal the denial in accordance with the Review Procedure described below.

          8.3 Request for a Review. Any person (or that person’s authorized representative) for
whom an application for benefits is denied (or deemed denied), in whole or in part, may appeal the
denial by submitting a request for a review to the Plan Administrator within 60 days after the
application is denied (or deemed denied). The Plan Administrator will give the applicant (or his
or her representative) an opportunity to review pertinent documents in preparing a request for a
review and submit written comments, documents, records and other information relating to the claim.
A request for a review shall be in writing and shall be addressed to:

12

 

Plan Administrator

c/o Mylan Inc.

1500 Corporate Drive

Canonsburg, PA 15317

With a copy to:

Chief Legal Officer

Mylan Inc.

1500 Corporate Drive

Canonsburg, PA 15317

A request for review must set forth all of the grounds on which it is based, all facts in support
of the request and any other matters that the applicant feels are pertinent. The Plan
Administrator may require the applicant to submit additional facts, documents or other material as
he or she may find necessary or appropriate in making his or her review.

          8.4 Decision on Review. The Plan Administrator will act on each request for review
within sixty (60) days after receipt of the request, unless special circumstances require an
extension of time (not to exceed an additional sixty (60) days), for processing the request for a
review. If an extension for review is required, written notice of the extension will be furnished
to the applicant within the initial sixty (60)-day period. The Plan Administrator will give
prompt, written notice of his or her decision to the applicant. In the event that the Plan
Administrator confirms the denial of the application for benefits in whole or in part, the notice
will outline, in a manner calculated to be understood by the applicant, the specific Plan
provisions upon which the decision is based. If written notice of the Plan Administrator’s
decision is not given to the applicant within the time prescribed in this Section 8.4 the
application will be deemed denied on review.

          8.5 Rules and Procedures. The Plan Administrator may establish rules and procedures,
consistent with the Plan and with ERISA, as necessary and appropriate in carrying out his or her
responsibilities in reviewing benefit claims. The Plan Administrator may require an applicant who
wishes to submit additional information in connection with an appeal from the denial (or deemed
denial) of benefits to do so at the applicant’s own expense.

          8.6 Exhaustion of Remedies. No legal action for benefits under the Plan may be
brought until the claimant (i) has submitted a written application for benefits in accordance with
the procedures described by Section 8.1 above, (ii) has been notified by the Plan Administrator
that the application is denied (or the application is deemed denied due to the Plan Administrator’s
failure to act on it within the established time period), (iii) has filed a written request for a
review of the application in accordance with the appeal procedure described in Section 8.3 above
and (iv) has been notified in writing that the Plan Administrator has denied the appeal (or the
appeal is deemed to be denied due to the Plan Administrator’s failure to take any action on the
claim within the time prescribed by Section 8.4 above).

13

 

SCHEDULE A

WAIVER AND RELEASE OF CLAIMS AGREEMENT

          YOU HAVE BEEN ADVISED TO CONSULT AN ATTORNEY PRIOR TO SIGNING THIS AGREEMENT.

          YOU HAVE [FORTY-FIVE] [TWENTY-ONE] DAYS AFTER RECEIVING THIS AGREEMENT TO CONSIDER WHETHER TO
SIGN IT.

          AFTER SIGNING THIS AGREEMENT, YOU HAVE ANOTHER SEVEN DAYS IN WHICH TO REVOKE IT, AND IT DOES
NOT TAKE EFFECT UNTIL THOSE SEVEN DAYS HAVE ENDED.

          In consideration of, and subject to, the payments to be made to me by Mylan Inc.
(“Mylan”) or any of its subsidiaries, pursuant to the Mylan Laboratories Severance Plan
(the “Plan”), which I acknowledge that I would not otherwise be entitled to receive, I
hereby waive any claims I may have for employment or re-employment by Mylan or any subsidiary
thereof after the date hereof, and I further agree to and do release and forever discharge Mylan or
any subsidiary of Mylan and their respective past and present officers, directors, shareholders,
employees and agents from any and all claims and causes of action, known or unknown, arising out of
or relating to my employment with Mylan or any subsidiary of Mylan or the termination thereof,
including, but not limited to, wrongful discharge, breach of contract, tort, fraud, any State’s
Human Relations Act, the Americans with Disabilities Act, Title VII of the Civil Rights Act of
1964, the Civil Rights Act of 1991, Sections 1981-1988 of Title 42 of the U. S. Code, Older
Workers’ Benefit Protection Act, Family and Medical Leave Act, the Fair Labor Standards Act, any
State’s Wage Payment and Collection laws, the Age Discrimination in Employment Act of 1967, the
Pregnancy Discrimination Act, the Employee Retirement Income Security Act of 1974, all as amended.
Should you decide to file any charge or legal claim against the Company, you agree to waive your
right to recover any damages or other relief awarded to you which arises out of any such charge or
legal claim made by you against the Company.

          Notwithstanding the foregoing or any other provision hereof, nothing in this Waiver and
Release of Claims Agreement shall adversely affect (i) my rights under the Plan; (ii) my rights to
benefits other than severance benefits under plans, programs and arrangements of Mylan or any
subsidiary or parent of Mylan; or (iii) my rights to indemnification under any indemnification
agreement, applicable law and the certificates of incorporation and bylaws of Mylan and any
subsidiary of Mylan, and my rights under any director’s and officer’s liability insurance policy
covering me.

          I acknowledge that I have signed this Waiver and Release of Claims Agreement voluntarily,
knowingly, of my own free will and without reservation or duress, and that no promises or
representations, written or oral, have been made to me by any person to induce me to do so other
than the promise of payment set forth in the first paragraph above and Mylan’s acknowledgment of my
rights reserved under the preceding paragraph above.

14

 

          I understand that this release will be deemed to be an application for benefits under the
Plan, and that my entitlement thereto shall be governed by the terms and conditions of the Plan,
and I expressly hereby consent to such terms and conditions.

          I acknowledge that I have been given not less than [forty-five (45)] [twenty-one (21)] days to
review and consider this Waiver and Release of Claims Agreement, and that I have had the
opportunity to consult with an attorney or other advisor of my choice and have been advised by
Mylan to do so if I choose. I may revoke this Waiver and Release of Claims Agreement seven days or
less after its execution by providing written notice to the Vice-President of Human Resources at
Mylan’s corporate headquarters (or some other designee).

          Finally, I acknowledge that I have carefully read this Waiver and Release of Claims Agreement
and understand all of its terms. This is the entire Agreement between the parties and is legally
binding and enforceable.

          This Waiver and Release of Claims Agreement shall be governed and interpreted under federal
law and the laws of Pennsylvania.

          I knowingly and voluntarily sign this Waiver and Release of Claims Agreement and agree to be
bound by its terms.

	 	 	 	 	 	 	 	 	 	 	 
	Date Delivered to Employee:	 	 	 	Mylan Inc.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Date Signed by Employee:	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Seven-Day Revocation Period Ends:	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Signed:

	 	 	 	 	 	Date:	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 

(Print Employee’s Name)

15EX-10.7(B)

Exhibit
10.7 (b)

EXECUTION COPY

THIS CONFIRMATION AMENDS, REPLACES, SUPERSEDES AND RESTATES IN ITS ENTIRETY ALL PREVIOUS
CONFIRMATIONS PERTAINING TO THIS TRANSACTION.

Confirmation of OTC Convertible Note Hedge

			
	Date:	 	September 9, 2008

Amendment Date: November 25, 2008

			
	To:	 	Mylan Inc. (“Counterparty”)

			
	From:	 	Merrill Lynch International (“Dealer”)

Dealer Reference: 088593440

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, Dealer and Merrill
Lynch, Pierce, Fenner & Smith Incorporated (the “Agent”), 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 purposes of the
Equity Definitions and a “Swap Transaction” for the purposes of the Swap 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 (the “Master Agreement” or “Agreement”), as if we had
executed an agreement in such form, including a Credit Support Annex (Bilateral Form — New York
law version), (but without any Schedule and with the 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 parties acknowledge that this Confirmation is entered into on the date hereof with the
understanding that the provisions of the Note Indenture (as defined below) that are referred to
herein will conform to the descriptions thereof in the Offering Memorandum dated September 9, 2008
(the “Offering Memorandum”) relating to the Reference Notes (as defined below). The
parties agree that in the event of any inconsistency between the Note Indenture and the Offering
Memorandum, the parties will amend this Confirmation in good faith to preserve the intent of the
parties.

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

OTC Convertible Note Hedge (2015)

 

 

     General Terms:

	 	 	 
	Trade Date:

	 	September 9, 2008
	 
	 	 
	Effective Date:

	 	The date of issuance of the Reference Notes.
	 
	 	 
	Option Style:

	 	Modified American, as described under “Settlement Terms”
below.
	 
	 	 
	Option Type:

	 	Call
	 
	 	 
	Seller:

	 	Dealer
	 
	 	 
	Buyer:

	 	Counterparty
	 
	 	 
	Shares:

	 	The shares of Common Stock, $0.50 par value, of Counterparty
(Security Symbol: “MYL”).
	 
	 	 
	Number of Options:

	 	The number of Reference Notes in denominations of USD1,000
principal amount issued by Counterparty on the closing date
for the initial issuance of the Reference Notes; provided
that the Number of Options shall be automatically increased
as of the date of exercise by Merrill Lynch, Pierce, Fenner
& Smith Incorporated and Goldman, Sachs & Co. of the Initial
Purchasers’ (as such term is defined in the Purchase
Agreement) option to purchase additional Reference Notes
pursuant to Section 2(b) of the Purchase Agreement related
to the purchase and sale of the Reference Notes dated as of
September 9, 2008 among Counterparty and the Initial
Purchasers (the “Purchase Agreement”) by the number of
Reference Notes in denominations of USD1,000 principal
amount issued pursuant to such exercise (such Reference
Notes, the “Additional Reference Notes”).
	 
	 	 
	Number of Shares:

	 	The product of the Number of Options and the Conversion
Reference Rate (as defined in the Note Indenture), but
without regard to any adjustment to the Conversion Reference
Rate as a result of the Excluded Provisions of the Note
Indenture.
	 
	 	 
	Applicable Percentage:

	 	70%
	 
	 	 
	Premium:

	 	$98,105,000; provided that if the Number of Options is
increased pursuant to the proviso to the definition of
“Number of Options” above, an additional Premium equal to
the product of the number of Options by which the Number of
Options is so increased and $3.73359 shall be paid on the
Additional Premium Payment Date.
	 
	 	 
	Premium Payment Date:

	 	The date of issuance of the Reference Notes.

OTC Convertible Note Hedge (2015)

2

 

	 	 	 
	Additional Premium Payment Date:

	 	The closing date for the purchase and sale of the Additional
Reference Notes.
	 
	 	 
	Exchange:

	 	New York Stock Exchange
	 
	 	 
	Related Exchange(s):

	 	All Exchanges
	 
	 	 
	Reference Notes:

	 	3.75% Cash Convertible Senior Notes due 2015 of Counterparty
	 
	 	 
	Note Indenture:

	 	The indenture, dated as of closing of the issuance of the
Reference Notes, between Counterparty, and the guarantors
named therein and The Bank of New York, as trustee relating
to the Reference Notes, as in effect on the date of its
execution. For the avoidance of doubt, references in this
Confirmation to the “Note Indenture” and to terms defined
therein shall be deemed to exclude any amendments to the
Note Indenture that would have the effect of altering the
obligations of the parties hereunder unless the parties
agree otherwise in writing. Certain capitalized terms used
but not defined herein have the meanings assigned to them in
the Note Indenture. As used herein, the term “Description
of Notes” refers to the section of the Offering Memorandum
bearing that designation.
	 
	 	 
	Procedures for Exercise:
	 	 
	 
	 	 
	Potential Exercise Dates:

	 	Each Cash Conversion Trigger Date.
	 
	 	 
	Conversion Date:

	 	Each “cash conversion trigger date” for any Reference Note
pursuant to the terms of the Note Indenture occurring before
the Expiration Date.
	 
	 	 
	Exercise on Conversion Dates:

	 	On each Conversion Date, a number of Options equal to the
number of Reference Notes in denominations of USD1,000
principal amount validly submitted for conversion on such
Conversion Date in accordance with the terms of the Note
Indenture shall be automatically exercised.
	 
	 	 
	Exercise Period:

	 	The period from and excluding the Effective Date to and
including the Expiration Date.
	 
	 	 
	Expiration Date:

	 	The earliest of (i) the stated maturity of the Reference
Notes and (ii) the first day on which none of such Reference
Notes remain outstanding, whether by virtue of conversion,
issuer repurchase or otherwise.
	 
	 	 
	Multiple Exercise:

	 	Applicable, as provided above under “Exercise on Conversion
Dates”.
	 
	 	 
	Minimum Number of Options:

	 	Zero
	 
	 	 
	Maximum Number of Options:

	 	Number of Options
	 
	 	 
	Automatic Exercise:

	 	As provided above under “Exercise on Conversion Dates”.

OTC Convertible Note Hedge (2015)

3

 

	 	 	 
	Exercise Notice:

	 	Notwithstanding the exercise of any Options hereunder, Buyer
shall be entitled to receive the deliveries provided under
“Settlement Terms” below only if Buyer shall have delivered
to Seller a written notice (“Exercise Notice”) prior to 5:00
PM, New York City time, on the “Business Day”, as defined in
the Note Indenture, prior to the first Scheduled Trading Day
of the Conversion Reference Period relating to the Reference
Notes converted on the Conversion Date occurring on the
relevant Exercise Date (such time, the “Notice Deadline”) of
(i) the number of Options being exercised, (ii) the first
Scheduled Trading Day of the Conversion Reference Period and
(iii) the scheduled settlement date under the Note Indenture
for the Reference Notes converted on the Conversion Date
occurring on the Exercise Date for such exercise; provided
that with respect to Reference Notes converted during the
period beginning on the 45th “Scheduled Trading Day:” (as
defined in the Note Indenture) prior to the “Stated
Maturity” (as defined in the Note Indenture) of the
Reference Notes and ending on the final date on which
Reference Notes may be surrendered for cash conversion, the
related Exercise Notice need not contain the information
specified in clause (i) of this sentence and, in order to
exercise any Options hereunder, Buyer shall deliver to
Seller prior to 5:00 p.m. New York City time on the Business
Day prior to such Stated Maturity a written notice
(“Supplemental Exercise Notice”) setting forth the number of
Reference Notes converted during such period; provided
further that, notwithstanding the foregoing, any Exercise
Notice (and the related automatic exercise of Options) shall
be effective if given after the relevant Notice Deadline but
prior to 5:00 PM New York City time, on the fifth Scheduled
Trading Day following the Notice Deadline, in which event
the Calculation Agent shall adjust the Delivery Obligation
(as defined below) as appropriate to reflect the additional
costs (including, but not limited to, hedging mismatches and
market losses) and reasonable expenses incurred by Seller in
connection with its hedging activities (including the
unwinding of any hedge position) as a result of its not
having received such notice prior to the applicable Notice
Deadline.

	 	 	 	 	 
	Seller’s Telephone Number and
Telex and/or Facsimile Number
and Contact Details for purpose
of Giving Notice:

	 	Address:
	 	Merrill Lynch International

Merrill Lynch Financial Centre

2 King Edward Street

Merrill Lynch Financial Centre

London EC1A 1HQ
	 

	 	Attention:
	 	Manager of Equity Documentation
	 

	 	Facsimile No.:
	 	+44 207 995 2004
	 

	 	Telephone No.:
	 	+44 207 995 3769

	 	 	 
	Settlement Terms:
	 	 
	 
	 	 
	Settlement Date:

	 	The settlement date specified in the Note Indenture for the
payment of the Conversion Reference Value upon the
conversion of Reference Notes.

OTC Convertible Note Hedge (2015)

4

 

	 	 	 
	Delivery Obligation:

	 	In lieu of the obligations set forth in Sections 8.1 and 9.1
of the Equity Definitions, and subject to “Exercise Notice”
above and “Condition to Delivery Obligation” below, in
respect of an Exercise Date occurring on a Conversion Date,
Seller will pay to Buyer on the related Settlement Date an
amount in cash equal to the product of (w) the Applicable
Percentage, (x) the number of Options exercised on such
Exercise Date and (y) the sum, for each Trading Day during
the Conversion Reference Period for such Exercise Date, of
the excess, if any, of (i) the Daily Conversion Reference
Value on such Trading Day over (ii) the quotient of $1,000
divided by the number of Trading Days in such Conversion
Reference Period (such amount, the “Convertible
Obligation”); provided that the Delivery Obligation shall be
determined by excluding any amount that Buyer is obligated
to pay to holders of the Reference Notes as a direct or
indirect result of any adjustments to the Conversion
Reference Rate pursuant to the Excluded Provisions of the
Note Indenture and, for the avoidance of doubt, any interest
payment or distribution that Buyer is obligated to deliver
in respect of References Notes converted on such Conversion
Date.
	 
	 	 
	Condition to Delivery
Obligation:

	 	Notwithstanding anything to the contrary in this
Confirmation or the Agreement, Dealer’s obligation to pay
Counterparty the Delivery Obligation in respect of any
Exercise Date shall be conditioned upon Counterparty’s
payment of the Conversion Reference Value (as defined in the
Note Indenture) in respect of all the Reference Notes
converted on the Conversion Date occurring on such Exercise
Date.
	 
	 	 
	Excluded Provisions:

	 	Those provisions of the Note Indenture that provide for
discretionary or voluntary adjustments of the conversion
reference rate by the Issuer. Notwithstanding anything to
the contrary herein or in the Equity Definitions, in no
event shall any adjustments in respect of any Potential
Adjustment Event or Extraordinary Event be made hereunder as
a result of any adjustments to the Conversion Reference Rate
pursuant to the Excluded Provisions of the Note Indenture.
	 
	 	 
	Conversion Reference Period:

	 	For any Exercise Date, the “conversion reference period” as
defined in the Note Indenture with respect to the Conversion
Date occurring on such Exercise Date.
	 
	 	 
	Other Applicable Provisions:

	 	To the extent Seller is obligated to deliver Shares
hereunder, the provisions of Sections 9.1(c), 9.8, 9.9,
9.10, 9.11 (except that the Representation and Agreement
contained in Section 9.11 of the Equity Definitions shall be
modified by excluding any representations therein relating
to restrictions, obligations, limitations or requirements
under applicable securities laws as a result of the fact
that Buyer is the issuer of the Shares) and 9.12 of the
Equity Definitions will be applicable as if “Physical
Settlement” applied to the Transaction.
	 
	 	 
	Adjustments:
	 	 
	 
	 	 
	Method of Adjustment:

	 	Calculation Agent Adjustment; provided that the terms of
this Transaction shall be adjusted in a manner consistent
with adjustments of the Conversion Reference Rate of the
Reference Notes as provided in the Note Indenture; provided
that no adjustment in respect of any Potential Adjustment
Event or Extraordinary Event shall be made hereunder as a
result of any adjustments to the Conversion Reference Rate
pursuant to the Excluded Provisions of the Note Indenture.

OTC Convertible Note Hedge (2015)

5

 

	 	 	 
	Potential Adjustment Event:

	 	Notwithstanding Section 11.2(e) of the Equity Definitions, a
“Potential Adjustment Event” means, subject to the preceding
paragraph, the occurrence of an event or condition that
would result in an adjustment of the Conversion Reference
Rate of the Reference Notes pursuant to the Note Indenture.
	 
	 	 
	Extraordinary Events:
	 	 
	 
	 	 
	Merger Events:

	 	Notwithstanding Section 12.1(b) of the Equity Definitions, a
“Merger Event” means the occurrence of any event or
condition to which the sections of the Note Indenture
corresponding to “Rights of Holders to Require Cash
Conversion of Notes — Business Combinations” in the
Description of Notes apply.
	 
	 	 
	Consequences for Merger Events:
	 	 
	 
	 	 
	          Share-for-Share:

	 	The Transaction will be adjusted in a manner corresponding
to the adjustments to the Reference Notes as provided in the
Note Indenture.
	 
	 	 
	          Share-for-Other:

	 	The Transaction will be adjusted in a manner corresponding
to the adjustments to the Reference Notes as provided in the
Note Indenture.
	 
	 	 
	          Share-for-Combined:

	 	The Transaction will be adjusted in a manner corresponding
to the adjustments to the Reference Notes as provided in the
Note Indenture.
	 
	 	 
	Notice of Merger Consideration:

	 	Upon the occurrence of a Merger Event that causes the Shares
to be converted into the right to receive more than a single
type of consideration (determined based in part upon any
form of stockholder election), Buyer shall reasonably
promptly (but in any event on or prior to the effective date
of such Merger Event) notify the Calculation Agent of the
weighted average of the types and amounts of consideration
received by the holders of Shares entitled to receive cash,
securities or other property or assets with respect to or in
exchange for such Shares in any Merger Event who
affirmatively make such an election.
	 
	 	 
	Tender Offer:

	 	Applicable, subject to “Consequences of Tender Offers” below.
Notwithstanding Section 12.1(d) of the Equity Definitions,
“Tender Offer” means the occurrence of any event or
condition to which the provisions of the Note Indenture
governing adjustments to the Conversion Reference Rate in
connection with a “tender offer” or “exchange offer” apply.
	 
	 	 
	Consequences of Tender Offers:

	 	The Transaction will be adjusted in a manner corresponding
to the adjustments to the Reference Notes as provided in the
Note Indenture.
	 
	 	 
	Nationalization, Insolvency and
Delisting:

	 	Cancellation and Payment (Calculation Agent Determination).
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,
the NASDAQ Global Market or the NASDAQ Global Select Market
(or their respective successors); 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.

OTC Convertible Note Hedge (2015)

6

 

	 	 	 
	Additional Disruption Events:
	 	 
	 
	 	 
	          Change in Law:

	 	Applicable , provided that clause (Y) of Section 12.9(a)(ii)
of the Equity Definitions shall not be applicable insofar as
any event described therein results in an increased cost to
Dealer of hedging the Transaction which increased cost would
have been included under Increased Cost of Hedging if such
provision were applicable.
	 
	 	 
	          Insolvency Filing:

	 	Applicable
	 
	 	 
	          Hedging Disruption Event:

	 	Not Applicable
	 
	 	 
	          Increased Cost of
Hedging:

	 	Not Applicable
	 
	 	 
	          Loss of Stock
Borrow:

	 	Not Applicable
	 
	 	 
	          Increased Cost of
Stock Borrow:

	 	Not Applicable
	 
	 	 
	          Hedging Party:

	 	Seller
	 
	 	 
	          Determining Party:

	 	Seller
	 
	 	 
	Non-Reliance:

	 	Applicable
	 
	 	 
	Agreements and Acknowledgments
Regarding Hedging Activities:

	 	Applicable
	 
	 	 
	Additional Acknowledgments:

	 	Applicable

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

	1.	 	Buyer hereby represents and warrants to Seller, on each day from the Trade Date to and
including the earlier of (i) October 7, 2008 and (ii) the date by which Seller is able to
initially complete a hedge of its position relating to this Transaction (including of any
increase in the Number of Options resulting from exercise of the over-allotment option
pursuant to Section 2(b) of the Purchase Agreement), that:

	 	a.	 	it will effect (and cause any “affiliated purchaser” (as defined in Rule 10b-18
promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange
Act”)) to effect) any purchases, direct or indirect (including by means of any
cash-settled or other derivative instrument), of Shares or any security convertible
into or exchangeable or exercisable for Shares on any single day solely through either
Merrill Lynch, Pierce, Fenner & Smith Incorporated or Goldman, Sachs & Co. in a manner
that would not cause any purchases by Seller of its hedge in connection with this
Transaction not to comply with applicable securities laws; provided that this clause
(a) shall not apply to any transactions in Shares effected directly between Buyer and
its employees pursuant to

OTC Convertible Note Hedge (2015)

7

 

	 	 	 	an employee share incentive or benefit plan;
	 
	 	b.	 	it will not engage in, or be engaged in, any “distribution,” as such term is
defined in Regulation M promulgated under the Exchange Act, other than a distribution
meeting the requirements of the exceptions set forth in sections 101(b)(10) and
102(b)(7) of Regulation M (it being understood that Buyer makes no representation
pursuant to this clause in respect of any action or inaction taken by Seller or any
initial purchaser of the Reference Notes); and
	 
	 	c.	 	Buyer has publicly disclosed all material information necessary for Buyer to be
able to purchase or sell Shares in compliance with applicable federal securities laws.

	2.	 	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.
	 
	3.	 	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.
	 
	4.	 	The representations and warranties set forth in Section 1 of the Purchase Agreement (as
defined herein) are hereby deemed to be repeated to Dealer as if set forth herein.

Additional Termination Events: 

The occurrence of an Amendment Event or a Repayment Event shall be an Additional Termination Event
with respect to which the Transaction is the sole Affected Transaction, Counterparty is the sole
Affected Party and Dealer is the sole party entitled to designate an Early Termination Date;
provided that in the case of a Repayment Event, the Transaction shall be subject to termination
only in respect of the number of Reference Notes that cease to be outstanding in connection with or
as a result of such Repayment Event and, notwithstanding anything to the contrary in this Agreement, no payments shall be required under this Agreement with
respect to such number of Reference Notes:

	1.	 	“Amendment Event” means that the Counterparty, without Dealer’s consent, amends,
modifies, supplements or obtains a waiver of (a) any term of the Note Indenture (as in effect
prior to such amendment, modification, supplement or waiver) or the Reference Notes relating
to the principal amount, coupon, maturity, repurchase obligation of the Counterparty or
redemption right of the Counterparty, (b) any material term relating to conversion of the
Reference Notes, including, without limitation, any changes to the conversion price,
conversion settlement dates or conversion conditions or (c) any term that would require
consent of the holders of 100% of the principal amount of the Reference Notes to amend.
	 
	2.	 	“Repayment Event” means that (a) any Reference Notes are repurchased (whether in
connection with or as a result of a fundamental change or change of control, howsoever
defined, or for any other reason) by the Counterparty, (b) any Reference Notes are delivered
to the Counterparty in exchange for delivery of any property or assets of the Counterparty or
any of its subsidiaries (howsoever described), other than as a result of and in connection
with a Conversion Date, (c) any principal of any of the Reference Notes is repaid prior to the
Stated Maturity (as defined in the Note Indenture) (whether following acceleration of the
Reference Notes or otherwise), provided that no payments of cash made in respect of the
conversion of a Reference Note shall be deemed a payment of principal under this clause (c),
(d) any Reference 

OTC Convertible Note Hedge (2015)

8

 

	 	 	Notes are exchanged by or for the benefit of the holders thereof for any
other securities of the Counterparty or any of its Affiliates (or any other property, or any
combination thereof) pursuant to any exchange offer or similar transaction (other than an
exchange of the Reference Notes for a new series of notes of the Counterparty that are
substantially identical to the Reference Notes other than in respect of restrictions on
transfer) or (e) any of the Reference Notes is surrendered by Counterparty to the trustee for
cancellation, other than registration of a transfer of such Reference Notes or as a result of
and in connection with a Conversion Date.

Initial Purchase Event:

If an Initial Purchase Event (as defined below) occurs, all of the respective rights and
obligations of Dealer and Counterparty hereunder shall be cancelled and terminated, except that
Counterparty shall pay to Dealer an amount in cash equal to the aggregate amount of costs and
expenses relating to the unwinding of Dealer’s hedging activities in respect of the Transaction
(including market losses incurred in reselling any Shares purchased by Dealer or its affiliates in
connection with such hedging activities). Following such payment, each party agrees that all
obligations with respect to the Transaction shall be deemed fully and finally discharged.

	 	 	“Initial Purchase Event” means that the transactions contemplated by the Purchase
Agreement shall fail to close for any reason other than in cases involving a breach of the
Purchase Agreement by the Initial Purchasers by the closing date for the offering of the
Reference Notes as specified in the Purchase Agreement.

Disposition of Hedge Shares:

Counterparty hereby agrees that if, in the reasonable judgment of Seller based on advice of
counsel, the Shares acquired by Seller for the purpose of hedging its obligations pursuant to the
Transaction (the “Hedge Shares”) cannot be sold in the U.S. public market by Seller without
registration under the Securities Act, Counterparty shall, at its election: (i) in order to allow
Seller to sell the Hedge Shares in a registered offering, use commercially reasonable efforts to
make available to Seller an effective registration statement under the Securities Act to cover the
resale of such Hedge Shares and (a) enter into an agreement, in form and substance satisfactory to
Seller, substantially in the form of an underwriting agreement for a registered offering, (b)
provide accountant’s “comfort” letters in customary form for registered offerings of equity
securities, (c) provide disclosure opinions of nationally recognized outside counsel to
Counterparty reasonably acceptable to Seller, (d) provide other customary opinions, certificates
and closing documents customary in form for registered offerings of equity securities and (e)
afford Seller a reasonable opportunity to conduct a “due diligence” investigation with respect to
Counterparty customary in scope for underwritten offerings of equity securities; provided, however,
that if Seller, in its sole reasonable discretion, is not satisfied with access to due diligence
materials, the results of its due diligence investigation, or the procedures and documentation for
the registered offering referred to above, then clause (ii) or clause (iii) of this Section shall
apply at the election of Counterparty; (ii) in order to allow Seller to sell the Hedge Shares in a
private placement, enter into a private placement agreement 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 satisfactory to Seller, including reasonable and customary
representations, covenants, blue sky and other governmental filings and/or registrations,
indemnities to Seller, due diligence rights (for Seller or any designated buyer of the Hedge Shares
from Seller), opinions and certificates and such other documentation as is customary for private
placements agreements, all reasonably acceptable to Seller (in which case, the Calculation Agent
shall make any adjustments to the terms of the Transaction that are necessary to compensate Seller
for any discount from the public market price of the Shares (other than any discount in respect of
commissions or fees payable to any third party) incurred on the sale of Hedge Shares in a private
placement); or (iii) purchase the Hedge Shares from Seller at the VWAP Price on such Exchange
Business Days, and in such amounts, as requested by Seller. “VWAP Price” means, on any
Exchange Business Day, the per Share volume-weighted average price as displayed under the heading
“Bloomberg VWAP” on Bloomberg page MYL.N <equity> VAP (or any successor thereto) in respect
of the period from 9:30 a.m. to 4:00 p.m. (New York City time) on such Exchange Business Day (or if
such volume-weighted average

OTC Convertible Note Hedge (2015)

9

 

price is unavailable, the market value of one Share on such Exchange
Business Day, as determined by the Calculation Agent using a volume-weighted method).

Repurchase Notices:

Counterparty shall, on any day on which Counterparty effects any repurchase of Shares, promptly
give Seller a written notice of such repurchase (a “Repurchase Notice”) on such day if
following such repurchase, the Notice Percentage as determined on such day is (i) greater than 6%
and (ii) greater by 0.5% than the Notice Percentage included in the immediately preceding
Repurchase Notice (or, in the case of the first such Repurchase Notice, greater than the Notice
Percentage as of the date hereof). In the event that Counterparty fails to provide Seller with a
Repurchase Notice on the day and in the manner specified in this section, then Counterparty agrees
to indemnify and hold harmless Seller, its affiliates and their respective directors, officers,
employees, agents and controlling persons (Seller and each such person being an “Indemnified
Party”) from and against any and all losses, claims, damages and liabilities (or actions in
respect thereof), joint or several, to which such Indemnified Party may become subject under
applicable securities laws, including without limitation, Section 16 of the Exchange Act, relating
to or arising out of such failure. If for any reason the foregoing indemnification is unavailable
to any Indemnified Party or insufficient to hold harmless any Indemnified Party, then Counterparty
shall contribute, to the maximum extent permitted by law, to the amount paid or payable by the
Indemnified Party as a result of such loss, claim, damage or liability. In addition, Counterparty
will reimburse any Indemnified Party for all reasonable and documented expenses (including
reasonable counsel fees and expenses) as they are incurred (after notice to Counterparty) in
connection with the investigation of, preparation for or defense or settlement of any pending or
threatened claim or any action, suit or proceeding arising therefrom, whether or not such
Indemnified Party is a party thereto and whether or not such claim, action, suit or proceeding is
initiated or brought by or on behalf of Counterparty. This indemnity shall survive the completion
of the Transaction contemplated by this Confirmation and any assignment and delegation of the
Transaction made pursuant to this Confirmation or the Agreement shall inure to the benefit of any
permitted assignee of Seller. Counterparty will not be liable under this 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 Dealer’s gross negligence or willful misconduct. The “Notice
Percentage” as of any day is the fraction, expressed as a percentage, (i) the numerator of which is
the product of (a) the Applicable Percentage, (b) the number of outstanding Reference Notes and (c)
a number of Shares per Reference Note equal to the Conversion Reference Rate (as defined in the
Note Indenture) and (ii) the denominator of which is the number of Shares outstanding on such day).

Conversion Reference Rate Adjustment Notices

Counterparty shall provide to Dealer written notice (such notice, a “Conversion Reference Rate
Adjustment Notice”) prior to the proposed effective date of any transaction or event (a
“Conversion Reference Rate Adjustment Event”) that would lead to an increase in the
Conversion Reference Rate (as such term is defined in the Note Indenture). Each Conversion
Reference Rate Adjustment Notice shall be delivered to Dealer at or prior to the deadline for
delivery of the related notices to the trustee under the Note Indenture. In connection with the
delivery of any Conversion Reference Rate Adjustment Notice to Dealer, (x) Counterparty shall,
concurrently with or prior to such delivery, publicly announce and disclose the Conversion
Reference Rate Adjustment Event or (y) Counterparty shall, concurrently with such delivery,
represent and warrant that the information set forth in such Conversion Reference Rate Adjustment
Notice does not constitute material non-public information with respect to Counterparty or the
Shares. The Conversion Reference Rate Adjustment Notice shall set forth the new, adjusted
Conversion Reference Rate after giving effect to such Conversion Reference Rate Adjustment Event
(the “New Conversion Reference Rate”); provided that if the New Conversion Reference Rate
cannot be determined at the time of delivery of the Conversion Reference Rate Adjustment Notice,
Counterparty shall provide to Dealer written notice of the New Conversion Reference Rate as
promptly as practicable following the availability of information required for its determination.

OTC Convertible Note Hedge (2015)

10

 

	 	 	 
	Compliance with 

Securities Laws:

	 	Counterparty represents and warrants that it has received, read and
understands the OTC Options Risk Disclosure Statement and a copy of
the most recent disclosure pamphlet prepared by The Options
Clearing Corporation entitled “Characteristics and Risks of
Standardized Options.
	 
	 	 
	 

	 	Each party acknowledges and agrees to be bound by the Conduct Rules
of the National Association of Securities Dealers, Inc. applicable
to transactions in options, and further agrees not to violate the
position and exercise limits set forth therein 
	 
	 	 
	 

	 	
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,
Buyer represents and warrants to Seller that (i) it has the
financial ability to bear the economic risk of its investment in
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 the Transaction is restricted under this
Confirmation, the Securities Act and state securities laws.
	 
	 	 
	 

	 	Buyer further represents:
	 
	 	 
	 

	 	(a) Buyer 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) Buyer acknowledges that as of the date hereof and without
limiting the generality of Section 13.1 of the Equity Definitions,
Seller is not making any representations or warranties with respect
to the treatment of the Transaction under FASB Statements 149, 150
or 157, EITF Issue No. 00-19 (or any successor issue statements),
under FASB’s Liabilities & Equity Project, or any other accounting
standard or guidance.
	 
	 	 
	Account Details:

	 	Account for payments to Buyer:     To be advised
	 
	 	 
	 

	 	Account for payment to Seller:        To be advised
	 
	 	 
	Bankruptcy Rights:

	 	In the event of Buyer’s bankruptcy, Seller’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 Seller’s rights with respect to any other claim
arising from this Transaction prior to Buyer’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.
	 
	 	 
	Collateral:

	 	Counterparty shall not be required to post collateral to Dealer.

OTC Convertible Note Hedge (2015)

11

 

	 	 	 
	Transfer:

	 	Buyer shall have the right to assign its rights and delegate its
obligations hereunder with respect to any portion of this
Transaction, subject to Seller’s consent, such consent not to be
unreasonably withheld or delayed; provided that such assignment or
transfer shall be subject to receipt by Seller of opinions and
documents reasonably satisfactory to Seller and effected on terms
reasonably satisfactory to the Seller with respect to any legal and
regulatory requirements relevant to the Seller; provided further
that Buyer shall not be released from its obligation to deliver any
Exercise Notice or its obligations pursuant to “Disposition of
Hedge Shares”, “Repurchase Notices” or “Conversion Reference Rate
Adjustment Notices” above, and Buyer shall be responsible for all
reasonable costs and expenses, including reasonable counsel fees,
incurred by Seller in connection with any such transfer or
assignment. Seller may transfer any of its rights or delegate its
obligations under this Transaction with the prior written consent
of Buyer, which consent shall not be unreasonably withheld or
delayed. Buyer and Seller agree that it shall not be unreasonable
for Buyer to withhold consent to any delegation of Seller’s
obligations under this Transaction to an entity the long-term U.S.
dollar-denominated debt obligations of which are rated below A by
Standard & Poors’ and below A2 by Moody’s.
	 
	 	 
	 

	 	If as determined in Dealer’s sole discretion, at any time Dealer’s
Ownership Percentage (as defined below) exceeds 8.5% (an “Excess
Ownership Position”) and Dealer, in its discretion, is unable to
effect a transfer or assignment to a third party after its
commercially reasonable efforts on pricing terms reasonably
acceptable to Dealer and within a time period reasonably acceptable
to Dealer (including without limitation where such inability of
Seller is due to Buyer’s withholding or delaying of consent to such
transfer or assignment) such that an Excess Ownership Position no
longer exists, Dealer may designate any Scheduled Trading Day as an
Early Termination Date with respect to a portion (the “Terminated
Portion”) of the Transaction, such that an Excess Ownership
Position no longer exists following such partial termination. In
the event that Dealer so designates an Early Termination Date with
respect to a portion of the Transaction, a payment or delivery
shall be made pursuant to Section 6 of the Agreement as if (i) an
Early Termination Date had been designated in respect of a
Transaction having terms identical to the Terminated Portion of the
Transaction, (ii) Counterparty were the sole Affected Party with
respect to such partial termination, (iii) such portion of the
Transaction were the only Terminated Transaction and (iv) Dealer
were the party entitled to designate an Early Termination Date
pursuant to Section 6(b) of the Agreement and to determine the
amount payable pursuant to Section 6(e) of the Agreement. The
“Ownership Percentage” as of any day is the fraction, expressed as
a percentage, (A) the numerator of which is the greater of (1) the
number of Shares that Dealer and any of its affiliates subject to
aggregation with Dealer for purposes of the “beneficial ownership”
test under Section 13 of the Exchange Act and all persons who may
form a “group” (within the meaning of Rule 13d-5(b)(1) under the
Exchange Act but excluding any group formed for the affirmative
purpose of changing or influencing control of the Issuer) with
Dealer (collectively, “Dealer Group”) “beneficially own” (within
the meaning of Section 13 of the Exchange Act) without duplication
on such day and (2) the number of shares that Dealer and all
persons comprising part of the same “acquiring person” as Dealer
“beneficially own”, as each such term is used in Counterparty’s
Rights Agreement between the Counterparty and American Stock
Transfer & Trust Company dated as of August 22, 1996, as amended as
of November 8, 1999, August 13, 2004, September 8, 2004, December
2, 2004 and December 19, 2005 (as so amended and as may be
subsequently amended, supplemented or replaced from time to time,
the “Rights Agreement”), on such day and (B) the denominator of
which is the number of Shares outstanding on such day.

OTC Convertible Note Hedge (2015)

12

 

	 	 	 
	 

	 	Dealer may assign and delegate its rights and obligations under
this Transaction without the consent of the Buyer to any subsidiary
of ML & Co. (the “Assignee”) by notice specifying the effective
date of such transfer (“Transfer Effective Date”) and including an
(i) executed acceptance and assumption by the Assignee of such
rights and obligations and (ii) evidence reasonably satisfactory to
Counterparty that such obligations of the Assignee are guaranteed
by ML & Co. to substantially the same extent as Dealer’s
obligations under this Transaction; provided that (i) Counterparty
will not, as a result of such transfer, be required to pay to the
Assignee an amount in respect of an Indemnifiable Tax under Section
2(d)(i)(4) of the Agreement (except in respect of interest under
Section 2(e), 6(d)(ii), or 6(e)) greater than the amount in respect
of which Counterparty would have been required to pay to Dealer in
the absence of such transfer; and (ii) the Assignee will not, as a
result of such transfer, be required to withhold or deduct on
account of a Tax under Section 2(d)(i) of the Agreement (except in
respect of interest under Section 2(e), 6(d)(ii), or 6(e)) an
amount in excess of that which Dealer would have been required to
withhold or deduct in the absence of such transfer, unless the
Assignee would be required to make additional payments pursuant to
Section 2(d)(i)(4) of the Agreement corresponding to such excess.
	 
	 	 
	 

	 	On the Transfer Effective Date, (a) Dealer shall be released from
all obligations and liabilities arising under this Transaction; and
(b) the assigned and delegated rights and obligations under this
Transaction shall cease to be a Transaction under the Agreement and
shall be deemed to be a Transaction under an ISDA form of Master
Agreement (Multicurrency-Cross Border) and Schedule substantially
in the form of the Agreement but amended to reflect the name of the
Assignee and the address for notices and any amended
representations under Part 2 of the Agreement as may be specified
in the notice of transfer.
	 
	 	 
	Right to Extend:

	 	Dealer may postpone any Exercise Date or Settlement Date or any
other date of valuation or delivery by Dealer, with respect to some
or all of the relevant Options (in which event the Calculation
Agent shall make appropriate adjustments to the Delivery
Obligation), if Dealer determines, in its reasonable discretion,
that such extension is reasonably necessary or appropriate to
preserve Dealer’s hedging or hedge unwind activity hereunder in
light of existing liquidity conditions in the cash market, the
stock borrow market or other relevant market or to enable Dealer to
effect purchases of Shares in connection with its hedging, hedge
unwind or settlement activity hereunder in a manner that would, if
Dealer were Counterparty or an affiliated purchaser of
Counterparty, be in compliance with applicable legal, regulatory or
self-regulatory requirements, or with related policies and
procedures applicable to Dealer.
	 
	 	 
	Regulation:

	 	Seller is regulated by The Securities and Futures Authority Limited.

Matters Relating to Agent: 

	1.	 	Agent will be responsible for the operational aspects of the Transactions effected through
it, such as record keeping, reporting, and confirming Transactions to Buyer and Seller;
	 
	2.	 	Unless Buyer is a “major U.S. institutional investor,” as defined in Rule 15a-6 of the
Exchange Act, neither Buyer nor Seller will contact the other without the direct involvement
of Agent;
	 
	3.	 	Agent’s sole role under this Agreement and with respect to any Transaction is as an agent of
Buyer and

OTC Convertible Note Hedge (2015)

13

 

	 	 	Seller on a disclosed basis and Agent shall have no responsibility or liability to
Buyer or Seller hereunder except for gross negligence or willful misconduct in the performance
of its duties as agent. Agent is authorized to act as agent for Buyer, 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. Agent shall have no authority to act as agent for Buyer
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 Buyer.

ISDA Master Agreement: 

With respect to the Agreement, Seller 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” as set forth in Section 5(a)(v) of the
Agreement shall not apply to Dealer or Counterparty.

“Specified Transaction” has the meaning assigned to such term in Section 14 of the
Agreement.

The “Cross Default” provisions of Section 5(a)(vi) of the Agreement will apply to
Counterparty; provided that the text of Section 5(a)(vi) following the words “occurrence or
existence of” in the second line thereof through the end of such Section 5(a)(vi) shall be replaced
in its entirety by the following:

	 	 	one or more defaults under any of the agreements, indentures or instruments under which
Issuer or any “significant subsidiary” (as such term is defined in Regulation S-X
promulgated under the Securities Act of 1933) of Issuer then has outstanding indebtedness in
excess of $50 million, individually or in the aggregate, and either (a) such default results
from the failure to pay such indebtedness at its stated final maturity and such default has
not been cured or the indebtedness repaid in full within ten days of the default or (b) such
default or defaults have resulted in the acceleration of the maturity of such indebtedness
and such acceleration has not been rescinded or such indebtedness repaid in full within ten
days of the acceleration;

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

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

“Termination Currency” means USD.

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.

Tax Representations.

	(a)	 	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 

OTC Convertible Note Hedge (2015)

14

 

	 	 	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.
	 
	(b)	 	Payee Representations. For the purpose of Section 3(f) of the Agreement, each party makes
the following representations to the other party:

(i) Dealer represents that it is a company organized under the laws of England and Wales.

(ii) Dealer represents that it is a “non-withholding foreign partnership” for United States
Federal income tax purposes and each partner of Dealer is a “non-U.S. branch of a foreign
person” for purposes of section 1.1441-4(a)(3)(ii) of the United States Treasury Regulations
and a “foreign person” for purposes of section 1.6041-4(a)(4) of the United States Treasury
Regulations.

(iii) Dealer represents that no partner of Dealer is (i) a bank that has entered into this
Agreement in the ordinary course of its trade or business of making loans, as described in
section 881(c)(3)(A) of the Internal Revenue Code of 1986, as amended
(the “Code”), (ii) a 10% shareholder of
Counterparty within the meaning of Code section 871(h)(3)(B), or (iii) a
controlled foreign corporation with respect to Counterparty within the meaning of
Code section 881(c)(3)(C).

(iv) 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:
	 
	 	 	Dealer agrees to complete (accurately and in a manner reasonably satisfactory to
Counterparty), execute, and deliver to Counterparty, United States Internal Revenue Service
Form W-8IMY and all required attachments, or any successor of such form(s): (i) before the
first payment date under this agreement; (ii) promptly upon reasonable demand by Counterparty; and (iii) promptly upon learning that any such Form previously provided by
Dealer has become obsolete or incorrect.
	 
	 	 	Counterparty agrees to complete (accurately and in a manner reasonably satisfactory to
Dealer), execute, and deliver to Dealer, 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 Dealer; and (iii) promptly upon learning
that any such form(s) previously provided by Counterparty 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
Dealer
	 	Evidence of the
authority and true
signatures of each
official or
representative signing
this Confirmation
	 	Upon or before

execution and
delivery of this
Confirmation
	 	Yes

OTC Convertible Note Hedge (2015)

15

 

	 	 	 	 	 	 	 
	 	 	 	 	 	 	Covered by
	Party Required to	 	 	 	 	 	Section 3(d)
	Deliver Document	 	Document Required to be Delivered	 	When Required	 	Representation
	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
certificates as Seller
shall reasonably
request
	 	Upon or before
execution and
delivery of this
Confirmation
	 	Yes
	Counterparty
	 	An opinion of counsel,
dated as of the
Effective Date and
reasonably acceptable
to Dealer 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
	Dealer
	 	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
execution and
delivery of this
Confirmation
	 	No

Additional Notice Requirements. Counterparty hereby agrees to promptly deliver to Seller a copy of
all notices and other communications required or permitted to be given to the holders of any
Reference Notes pursuant to the terms of the Note Indenture on the dates so required or permitted
in the Note Indenture and all other notices given and other communications made by Counterparty in
respect of the Reference Notes to holders of any Reference Notes. Counterparty further covenants
to Seller that it shall promptly notify Seller of each Conversion Date, Amendment Event (including
in such notice a detailed description of any such amendment) and Repayment Event (identifying in such notice the nature of such Repayment Event and the
principal amount at maturity of Reference Notes being paid).

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

Address for notices or communications to Seller 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

Additionally, a copy of all notices pursuant to Sections 5, 6, and 7 as
well as any changes to Counterparty’s address, telephone number or facsimile number should be sent
to:

	 	 	 	 	 
	 

	 	Address:
	 	GMI Counsel

Merrill Lynch World Headquarters

4 World Financial Center

New York, New York 10080
	 
	 	 	 	 
	 

	 	Attention:
	 	Global Equity Derivatives
	 

	 	Facsimile No.:
	 	212-449-6576
	 

	 	Telephone No.:
	 	212-449-6309

Address for notices or communications to Counterparty for all purposes:

OTC Convertible Note Hedge (2015)

16

 

	 	 	 	 	 
	 

	 	Address:
	 	Mylan Inc.

1500 Corporate Drive

Canonsburg, PA 15317
	 

	 	Attention:
	 	                    Edward J. Borkowski, Chief Financial Officer
	 

	 	Facsimile No.:
	 	                    (724) 514 1871
	 

	 	Telephone No.:
	 	                    (724) 514 1870

	 	 	 
	Multibranch Party.

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

	 	The Calculation Agent is Seller. 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 Hedging Party or Determining 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; provided that in no event shall Calculation Agent be
required to disclose its proprietary models or other proprietary
information. 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.

Seller: Guarantee of Merrill Lynch & Co., Inc. in the form attached hereto as
Exhibit A and a collateral account control agreement to be entered into between
Counterparty, Dealer and MLFP&S, as custodian, (“Collateral Account Control
Agreement”) prior to any required delivery of collateral hereunder. The
Collateral Account Control Agreement shall be in customary form and reasonably
acceptable to Counterparty.

Counterparty: Not Applicable

Credit Support Provider.

With respect to Seller: Merrill Lynch & Co., Inc.

With respect to Counterparty: Not Applicable.

Collateral Provisions

     The following provisions set forth the terms and conditions of the collateral delivery
obligations of Dealer applicable to the Transaction pursuant to the Credit Support Annex.

	 	 	 
	Pledgor:

	 	Dealer
	 
	 	 
	Secured Party:

	 	Counterparty
	 
	 	 
	Collateral:

	 	Dealer will pledge Eligible Collateral in an amount and subject to the terms as defined below.
	 
	 	 
	Credit Support Amount:

	 	As specified in Paragraph 3 of the Credit Support Annex.

OTC Convertible Note Hedge (2015)

17

 

	 	 	 
	Valuation Date (for purposes
of the CSA):

	 	Every Monday during the term of the Transaction
	 
	 	 
	Valuation Time:

	 	 5:00 PM EST
	 
	 	 
	Notification Time:

	 	 10 a.m. on the next Local Business Day after the relevant Valuation Date
	 
	 	 
	Valuation Agent:

	 	Dealer
	 
	 	 
	Independent Amount:

	 	 $0
	 
	 	 
	Threshold:

	 	Infinity; provided that the Threshold shall be $50,000,000 if, and for so long as, the long-term U.S.
dollar-denominated debt obligations of Dealer’s Credit Support Provider are rated below A- by
Standard & Poors’ and below A3 by Moody’s.
	 
	 	 
	Minimum Transfer Amount:

	 	 $500,000
	 
	 	 
	Custodian:

	 	Merrill Lynch, Pierce, Fenner & Smith Incorporated pursuant to a Collateral Account Control Agreement.
	 
	 	 
	Use of Posted Collateral:

	 	The provisions of Paragraph 6(c) of the Credit Support Annex will not apply.
	 
	 	 
	Specified Condition:

	 	For purposes of Paragraph 4(a) of the Credit Support Annex, the following Termination Events will be
a Specified Condition with respect to the party that is the Affected Party for such Termination
Event: Illegality, Tax Event, Tax Event Upon Merger, Credit Event Upon Merger, Additional Termination
Events. For purposes of Paragraphs 8(a) and 8(b) of the Credit Support Annex, the following
Termination Events will be a Specified Condition with respect to the party that is the Affected Party
for such Termination Event: Credit Event Upon Merger, Additional Termination Events.
	 
	 	 
	Eligible Collateral:

	 	The following Items will qualify as “Eligible Collateral”:

	 	 	 	 	 
	 	 	Valuation
	Item:	 	Percentage:
	(A) Cash

	 	 	100	%
	 
	(B) Negotiable debt obligations issued by the U.S. Treasury
Department having a remaining maturity of not more than one
year

	 	 	100	%

OTC Convertible Note Hedge (2015)

18

 

	 	 	 	 	 
	 	 	Valuation
	Item:	 	Percentage:
	(C) Securities with maturities of 90 days or less from the
date of acquisition issued by the U.S., Switzerland, Canada,
England or a member state of the European Union (excluding
Greece, Italy and any Countries with sovereign debt ratings
below Aa1/AA+) or by an instrumentality or agency of the U.S.
government, Switzerland, Canada, England or a member state of
the European Union (excluding Greece, Italy and any Countries
with sovereign debt ratings below Aa1/AA+) having the same
credit rating as its government 100% $50 million maximum per
non-U.S. country

	 	 	100	%
	 
	(D) Certificates of deposit and eurodollar time deposits with
maturities of 90 days or less from the date of acquisition and
overnight bank deposits of any commercial bank having stable
ratings of at least A/A-1 by S&P and A2/P-1 by Moody’s

	 	 	100	%
	 
	(E) Repurchase obligations of any commercial bank satisfying
the requirements of clause (D) of this definition, having a
term of not more than seven days with respect to securities
issued by the U.S. Government

	 	 	100	%
	 
	(F) Commercial paper of a corporate issuer having stable
ratings of at least A/A- 1 by S&P and A2/P-1 by Moody’s and
maturing within 90 days after the day of acquisition

	 	 	100	%
	 
	(G) Securities with maturities of 90 days or less from the
date of acquisition issued by any state, commonwealth or
territory of the U.S., by any political subdivision or taxing
authority of any such state, commonwealth or territory, the
securities of which state, commonwealth, territory, political
subdivision or taxing authority (as the case may be) having
stable ratings of at least A by S&P and A2 by Moody’s

	 	 	100	%
	 
	(H) Securities with maturities of 90 days or less from the
date of acquisition backed by standby letters of credit issued
by any Lender or any commercial bank satisfying the
requirements of clause (D) of this definition

	 	 	100	%
	 
	(I) Shares of money market mutual or similar funds that
conform with Rule 2a-7 of the Investment Companies Act of 1940
and having a minimum asset size of $3 billion which invest
exclusively in assets satisfying the requirements of clauses
(C) through (H) of this definition

	 	 	100	%

OTC Convertible Note Hedge (2015)

19

 

	 	 	 	 	 
	 	 	Valuation
	Item:	 	Percentage:
	(J) Non-Callable Agency Debt having a remaining maturity of
not more than one year. For purposes hereof, “Non-Callable
Agency Debt” means fixed rate, non-callable, non-amortizing
U.S. Dollar-denominated senior debt securities of fixed
maturity in book entry form issued by the Federal Home Loan
Banks (including their consolidated obligations issued through
the Office of Finance of the Federal Home Loan Bank System)
(“FHLB”), Fannie Mae, the Federal Home Loan Mortgage
Corporation (“Freddie Mac”) or the Federal Farm Credit Banks
(“FFCB”)

	 	 	99	%
	 
	(K) Non-Callable Agency Discount Notes having a remaining
maturity of not more than twelve months. For purposes hereof,
“Non-Callable Agency Discount Notes” means non-callable U.S.
Dollar denominated discount notes sold at a discount from
their principal amount payable at maturity with an original
maturity of 360 days or less in book entry form and issued by
Fannie Mae, Freddie Mac, FHLB or FFCB

	 	 	99	%
	 
	(L) Callable Agency Debt having a remaining maturity of not
more than one year. For purposes hereof, “Callable Agency
Debt” means fixed-rate, callable non-amortizing U.S.
Dollar-denominated senior debt securities in book entry form
issued by FHLB, Fannie Mae or Freddie Mac

	 	 	99	%
	 
	(M) Negotiable debt obligations issued by the U.S. Treasury
Department having a remaining maturity of more than one year
but not more than ten years

	 	 	99	%
	 
	(N) Non-Callable Agency Debt and Callable Agency Debt having a
remaining maturity of more than one year but not more than ten
years

	 	 	98	%
	 
	(O) Negotiable debt obligations issued by the U.S. Treasury
Department having a remaining maturity of more than ten years

	 	 	98	%
	 
	(P) Non-Callable Agency Debt and Callable Agency Debt having a
remaining maturity of more than ten years

	 	 	97	%
	 
	(Q) Corporate Debt having stable ratings of AA or better by
Standard & Poor’s and Aa2 or better by Moody’s having a
remaining maturity of less than 1 year or as otherwise
mutually agreed by the Parties and listed in Attachment Q1
having a remaining maturity of less than one year

	 	 	97	%

OTC Convertible Note Hedge (2015)

20

 

	 	 	 	 	 
	 	 	Valuation
	Item:	 	Percentage:
	(R) Securities or other financial obligations of the Issuer of
the Shares, including without limitation, equity securities,
debt securities, convertible bonds, derivatives contracts and
any other financial instruments.

	 	 	100	%
	 
	(S) Securities or other financial obligations of corporations
(other than the Issuer of the Shares), including without
limitation, equity securities, debt securities, convertible
bonds and any other financial instruments.

	 	 	70	%

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

Submission to Jurisdiction. Each party hereby irrevocably and unconditionally submits for itself
and its property in any legal action or proceeding by the other party against it relating to the
Transaction to which it is a party, or for recognition and enforcement of any judgment in respect
thereof, to the exclusive jurisdiction of the Supreme Court of the State of New York, sitting in
New York County, the courts of the United States of America for the Southern District of New York,
and appellate courts from any of the foregoing.

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 and the Agreement.
	 
	(b)	 	The parties hereto intend for:

OTC Convertible Note Hedge (2015)

21

 

	 	(i)	 	Seller 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 therefore “on the day that is
three Local Business Days after the day.” Section 6(d)(ii) is further modified by deleting
the words “two Local Business Days” in the fourth line thereof and substituting therefore “three
Local Business Days.”

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 Seller 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 Seller) 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.

OTC Convertible Note Hedge (2015)

22

 

[Signatures follow on separate page]

OTC Convertible Note Hedge (2015)

23

 

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/ David Royce
	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	David Royce	 	 
	 

	 	Title:
	 	Authorized Signatory	 	 

	 	 	 	 	 
	Confirmed as of the date first above written:	 	 
	 
	 	 	 	 
	MYLAN INC.	 	 
	 
	 	 	 	 
	By:

	 	/s/ Edward J. Borkowski
	 	 
	 

	 	 	 	 
	Name:

	 	Edward J. Borkowski	 	 
	Title:

	 	Executive Vice President and

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: 

Name:

	 	/s/ Fran Jacobson
 

Fran Jacobson
	 	 
	Title:

	 	Authorized Signatory	 	 

 

 

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 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 Convertible Note Hedge between
the Company and ML (ML as Seller), dated as of September 9, 2008, with respect to the Reference
Notes (as defined therein) of Company due 2015 (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 constitute a guarantee of payment when
due and not of collection and 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. shall not exercise any rights that it may acquire by way of subrogation as a result
of a payment by it under this Guarantee at any time when any of the obligations of ML shall have
become due and remain unpaid. Any amount paid to ML & Co. in violation of the preceding sentence
shall be held for the benefit of the Company and shall forthwith be paid to the Company to be
credited and applied to such obligations of ML then due and unpaid. Subject to the foregoing, upon
payment of all such obligations of ML, ML & Co. shall be subrogated to the rights of the Company
against ML, and the Company agrees to take at ML & Co.’s expense such steps as ML &Co. may
reasonably request to implement such subrogation.

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

 

 

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 Kroplewnicki
 	 
	 	 	Name:  	Patricia Kroplenicki 	 
	 	 	Title:  	Designated Signatory	 
	 	 	Date:  	September 9, 2008

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