AMENDMENT NO. 2 TO TRANSITION AND
SUCCESSION AGREEMENT
THIS
AMENDMENT NO. 2 TO TRANSITION AND SUCCESSION AGREEMENT (this
“Amendment”) by and between Mylan Laboratories Inc., a
Pennsylvania corporation (the “Company”) and Robert J.
Coury (the “Executive”), is made as of April 3,
2006.
WHEREAS,
the Company and the Executive are parties to that certain
Transition and Succession Agreement dated as of December 15,
2003 and amended as of December 2, 2004 (as amended, the
“Agreement”);
WHEREAS,
the Company and the Executive wish to amend further the Agreement,
effective as of April 1, 2006, as set forth below;
NOW,
THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto,
intending to be legally bound, agree as follows:
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1.
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The
reference to “65%” in Section 1(b)(3) of the
Agreement is hereby deleted and replaced with
“60%.”
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2.
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The
following shall be added as new subsections 1(d), 1(e), and 1(f) of
the Agreement:
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“(d)
“Cause” means: (1) the Executive’s willful
and continued gross neglect of duties (other than resulting from
incapacity due to physical or mental illness or following the
Executive’s delivery of a Notice of Termination for Good
Reason (as defined herein)), or (2) the willful engaging by
the Executive in illegal conduct that is materially and
demonstrably injurious to the Company or (3) the willful
engaging by the Executive in gross misconduct that is materially
and demonstrably injurious to the Company which, for purposes of
clauses (1) and (3), has not been cured within 30 days
after a written demand for substantial performance is delivered to
the Executive by the Board that specifically identifies the manner
in which the Board believes that the Executive has grossly
neglected his duties or has engaged in gross misconduct. No act, or
failure to act, on the part of the Executive shall be considered
“willful” unless it is done, or omitted to be done, by
the Executive in bad faith or without reasonable belief that the
Executive’s action or omission was in the best interests of
the Company. Any act, or failure to act, based upon authority given
pursuant to a resolution duly adopted by the Board or based upon
the advice of counsel for the Company shall be conclusively
presumed to be done, or omitted to be done, by the Executive in
good faith and in the best interests of the Company. The cessation
of employment of the Executive shall not be deemed to be for Cause
unless and until there shall have been delivered to the Executive a
copy of a resolution duly adopted by the affirmative vote of not
less than three-quarters of the entire membership of the Board
(excluding the Executive, if the Executive is a member of the
Board) at a meeting of the Board called and held for such purpose
(after reasonable notice is
provided to the
Executive and the Executive is given an opportunity, together with
counsel for the Executive, to be heard before the Board), finding
that, in the good faith opinion of the Board, Cause exists and
specifying the particulars thereof in detail. In the event of a
dispute concerning the existence of “Cause,” any claim
by the Executive that “Cause” does not exist shall be
presumed correct unless the Company establishes by clear and
convincing evidence that Cause exists.
(e) “Good
Reason” means: (1) the assignment to the Executive of
any duties inconsistent in any respect with the Executive’s
position as Chief Executive Officer (including status, offices,
titles and reporting requirements), authority, duties or
responsibilities as contemplated by Section 1 of the
Employment Agreement, or any other diminution in such position (or
removal from such position), authority, duties, responsibilities or
conditions of employment (whether or not occurring solely as a
result of the Company’s ceasing to be a publicly traded
entity or becoming a subsidiary or a division of a publicly traded
entity), or the Executive determines in good faith that a change in
circumstances relating to his employment has rendered it
substantially more difficult for him to perform his duties and
responsibilities hereunder as Chief Executive Officer as compared
to prior to such change in circumstances (other than by reason of
Cause or his physical or mental incapacity), in each case excluding
for this purpose an isolated, insubstantial and inadvertent action
not taken in bad faith and that is remedied by the Company promptly
after receipt of notice thereof given by the Executive;
(2) failure to nominate the Executive as a member of the Board
of Directors (the “Board”) of the Company or removal of
the Executive from (or failure to re-elect the Executive to) his
position as a member of the Board; (3) any failure by the
Company to comply with any of the provisions of Section 3 of
the Employment Agreement, other than an isolated, insubstantial and
inadvertent failure not occurring in bad faith and that is remedied
by the Company promptly after receipt of notice thereof given by
the Executive; (4) the Company’s requiring the Executive
to be based at any office or location other than as provided in
Section 1 of the Employment Agreement; (5) any failure by the
Company to provide that a successor to the Company shall assume
this Agreement or the Employment Agreement; (6) the
Company’s giving written notice to the Executive that the
term of the Employment Agreement that is in effect at the time such
written notice is given is not to be extended or further extended;
(7) any other breach of the Employment Agreement or this
Agreement by the Company, excluding for this purpose an isolated,
insubstantial and inadvertent breach that is not taken in bad faith
and that is remedied by the Company promptly after receipt of
notice thereof given by the Executive. The Executive’s
continued employment shall not constitute consent to, or a waiver
of rights with respect to, any act or failure to act constituting
Good Reason hereunder. In connection with any dispute regarding the
existence of Good Reason, any claim by the Executive that Good
Reason exists shall be presumed to be correct unless the Company
establishes by clear and convincing evidence that Good Reason does
not exist.
(f) A
“Potential Change in Control” shall be deemed to have
occurred if any of the following shall have occurred: (a) the
Company enters into a definitive agreement,
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the
consummation of which would result in the occurrence of a Change in
Control; (b) any Person (other than the Company or any of its
subsidiaries) comm
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