AMENDMENT TO THE EMPLOYMENT
AGREEMENT
THIS
AMENDMENT TO EMPLOYMENT AGREEMENT (the “ Amendment
”) is entered into as of November 18, 2008 by and
between Barr Pharmaceuticals, Inc., a Delaware corporation having
its principal executive offices at 225 Summit Avenue, Montvale, New
Jersey 07645-1523 (the “ Company ”), and William
T. McKee (the “ Employee ”).
WHEREAS,
Employee is currently employed as Executive Vice President and
Chief Financial Officer of the Company pursuant to an amended and
restated employment agreement dated July 15, 2008, between
Employee and the Company (the “ Employment Agreement
”); and
WHEREAS,
the approval by the stockholders of Barr Pharmaceuticals, Inc.
(“ Barr ”) of the consummation of the
transactions contemplated in the Agreement and Plan of Merger,
dated as of July 17, 2008, among Teva Pharmaceutical
Industries Ltd. (“ Teva ”), Boron Acquisition
Corp. and Barr, as amended (the “ Merger Agreement
”), pursuant to which Barr will merge with and into Boron
Acquisition Corp., and ultimately become a wholly-owned subsidiary
of Teva (the “ Merger ”), will constitute a
“Change in Control” as such term is defined in the
Employment Agreement;
WHEREAS,
the Company wishes to assure itself of the services of the Employee
and provide an inducement for the Employee to remain in its employ;
and
WHEREAS,
in connection with the foregoing, the Company wishes to formally
amend the terms of the Employment Agreement to reflect those
changes to the Employment Agreement set forth herein, to be
effective as of the closing of the Merger; and
WHEREAS,
the Company and Employee agree to enter into such amendment on the
terms set forth herein.
NOW,
THEREFORE, in consideration of the mutual covenants and obligations
contained herein, and intending to be legally bound, the parties,
subject to the terms and conditions set forth herein, agree,
effective as of immediately prior to the Effective Time (as such
term is defined in the Merger Agreement), as follows:
Capitalized terms
not defined herein shall have the meaning set forth in the
Employment Agreement.
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1.
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The
title of Paragraph 5 of the Employment Agreement is amended to
read as follows:
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“ Termination of
Employment; Change in Control Payment .”
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2.
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The
title of Paragraph 5(a) of the Employment Agreement is amended to
read as follows:
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“ Termination of
Employment .”
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3.
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Paragraph 5(a)(i) of the
Employment Agreement is hereby deleted in its entirety and replaced
with the following:
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“(i) If the Employee’s
employment with the Company is terminated by the Company or an
Affiliate without Good Cause (except as an incident of assigning
the rights to Employee’s services to a Permitted Assignee in
accordance with Paragraph 13(d) below), and including as a result
of any non-renewal of this Agreement, in any such case when the
Employee is willing and able to continue performing service, or is
terminated by the
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Employee with
or without Good Reason (excluding upon the Employee’s death)
(any of the foregoing terminations, a “ Compensable
Termination ”), in each case following the Merger (as
such term is defined in Paragraph 9(f) below), the Company
shall:
(A) for
twenty-four (24) months following the Employee’s
termination, provide the Employee (and, as applicable, the
Employee’s covered dependents), at Company expense, with
continuation coverage under the Company’s group health
plan(s) covering similarly situated executives;
(B) pay the
Employee, in accordance with normal payroll practices, the portion
of the Employee’s Base Salary accrued through the date of the
Compensable Termination and any other amounts to which the Employee
is entitled by law or pursuant to the terms of any compensation or
benefit plan or arrangement in which the Employee participated
prior to the Compensable Termination;
(C) subject to all
of the provisions of this Section 5, Section 14 below,
and further subject to compliance by the Employee with the
provisions of Sections 6 and 7 below, relating to confidential
information, nonsolicitation and disparaging remarks, pay to the
Employee the Employee’s annual bonus for the fiscal year of
the Company preceding the fiscal year of the Company in which the
Compensable Termination occurs, if unpaid at the time of the
Compensable Termination. Such annual bonus shall be paid at the
same time as bonuses (if any) for such preceding fiscal year are
paid to other officers, and in all events within the first two and
one half (2 1 / 2
) months immediately following the
fiscal year of the Company to which such annual bonus relates. The
amount of such bonus shall be determined by the Board or a
committee of the Board on a basis consistent with the prior bonus
determinations with respect to the Employee or, for at least one
year following the Merger, consistent with the bonus determinations
with respect to the Employee prior to Merger. If the Board or a
committee of the Board made no bonus determinations with respect to
the Employee before the Compensable Termination or, if applicable,
before the Merger the amount of such bonus shall be determined on a
basis consistent with the Board’s or Board committee’s
bonus determinations with respect to other Executive Vice
Presidents before the Merger.
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Unless otherwise agreed by Teva and
Employee, and except as otherwise provided in Paragraph 5(b) and
5(e) below, Employee shall not be entitled to any cash severance
payments under any Company or Teva severance arrangements in
connection with such term
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