Exhibit 10.0

GOLDMAN, SACHS & CO. | 85 BROAD STREET | NEW YORK, NEW YORK 10004 | Tel: 212 902
1000

Opening Transaction

To:

The Cheesecake Factory Incorporated

 

 

26901 Malibu Hills Road

 

 

Calabasas Hills, CA 91301

 

 

 

A/C:

 

028611903

 

 

 

From:

 

Goldman, Sachs & Co.

 

 

 

Re:

 

Collared Accelerated Stock Buyback

 

 

 

Ref. No:

 

As provided in the Supplemental Confirmation

 

 

 

Date:

 

March 12, 2007

 

 

 

 

This master confirmation (this “Master Confirmation”), dated as of March 12,
2007, is intended to supplement the terms and provisions of certain Transactions
(each, a “Transaction”) entered into from time to time between Goldman, Sachs &
Co. (“GS&Co.”) and The Cheesecake Factory Incorporated (“Counterparty”). This
Master Confirmation, taken alone, is neither a commitment by either party to
enter into any Transaction nor evidence of a Transaction.  The terms of any
particular Transaction shall be set forth in (i) a Supplemental Confirmation in
the form of Schedule A hereto (a “Supplemental Confirmation”), which shall
reference this Master Confirmation and supplement, form a part of, and be
subject to this Master Confirmation and (ii) a Trade Notification in the form of
Schedule B hereto (a “Trade Notification”), which shall reference the relevant
Supplemental Confirmation and supplement, form a part of, and be subject to such
Supplemental Confirmation.  This Master Confirmation, each Supplemental
Confirmation and the related Trade Notification together shall constitute a
“Confirmation” as referred to in the Agreement specified below.

The definitions and provisions contained in the 2002 ISDA Equity Derivatives
Definitions (the “Equity Definitions”), as published by the International Swaps
and Derivatives Association, Inc., are incorporated into this Master
Confirmation.  This Master Confirmation, each Supplemental Confirmation and the
related Trade Notification evidence a complete binding agreement between
Counterparty and GS&Co. as to the subject matter and terms of each Transaction
to which this Master Confirmation, such Supplemental Confirmation and Trade
Notification relate and shall supersede all prior or contemporaneous written or
oral communications with respect thereto.

This Master Confirmation, each Supplemental Confirmation and each Trade
Notification supplement, form a part of, and are subject to an agreement in the
form of the 1992 ISDA Master Agreement (Multicurrency —Cross Border) (the
“Agreement”) as if GS&Co. and Counterparty had executed the Agreement on the
date of this Master Confirmation (but without any Schedule except for (i) the
election of Loss and Second Method, New York law (without regard to the
conflicts of law principles) as the governing law and US Dollars (“USD”) as the
Termination Currency, (ii) the election that subparagraph (ii) of Section 2(c)
will not apply to the Transactions, (iii) the replacement of the word “third” in
the last line of Section 5(a)(i) with the word “first” and (iv) the election
that the “Cross Default” provisions of Section 5(a)(vi) shall apply to
Counterparty, with a “Threshold Amount” of USD50 million).

All provisions contained or incorporated by reference in the Agreement shall
govern this Master Confirmation, each Supplemental Confirmation and each Trade
Notification except as expressly modified herein.

If, in relation to any Transaction to which this Master Confirmation, a
Supplemental Confirmation and a Trade Notification relate, there is any
inconsistency between the Agreement, this Master Confirmation, any Supplemental
Confirmation, any Trade Notification and the Equity Definitions, the following
will prevail for

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purposes of such Transaction in the order of precedence indicated: (i) such
Trade Notification, (ii) such Supplemental Confirmation; (iii) this Master
Confirmation; (iv) the Agreement; and (v) the Equity Definitions.

1.             Each Transaction constitutes a Share Forward Transaction for the
purposes of the Equity Definitions.  Set forth below are the terms and
conditions which, together with the terms and conditions set forth in the
related Supplemental Confirmation and Trade Notification (in respect of the
relevant Transaction), shall govern each such Transaction.

General Terms:

 

 

 

Trade Date:

For each Transaction, as set forth in the Supplemental Confirmation.

 

 

Buyer:

Counterparty

 

 

Seller:

GS&Co.

 

 

Shares:

Common Stock, $0.01 par value of Counterparty (Ticker: CAKE)

 

 

Forward Price:

The average of the VWAP Prices for each Exchange Business Day in the

 

Calculation Period.

 

 

VWAP Price:

For any Exchange Business Day, as determined by the Calculation Agent based on
the NASDAQ Volume Weighted Average Price per Share for the regular trading
session (including any extensions thereof) of the Exchange on such Exchange
Business Day (without regard to pre-open or after hours trading outside of such
regular trading session for such Exchange Business Day), as published by
Bloomberg at 4:15 p.m. New York time (or 15 minutes following the end of any
extension of the regular trading session) on such Exchange Business Day, on
Bloomberg page “CAKE.Q <Equity> AQR_SEC” (or any successor thereto). For
purposes of calculating the VWAP Price, the Calculation Agent will include only
those trades that are reported during the period of time during which
Counterparty could purchase its own shares under Rule 10b-18(b)(2) and pursuant
to the conditions of Rule 10b-18(b)(3), each under the Exchange Act (as defined
herein) (such trades, “Rule 10b-18 eligible transactions”).

 

 

Forward Price

 

Adjustment Amount:

For each Transaction, as set forth in the Supplemental Confirmation.

 

 

Calculation Period:

The period from and including the first Exchange Business Day immediately

 

following the Hedge Completion Date to and including the Termination Date (as

 

adjusted in accordance with the provisions hereof).

 

 

Termination Date:

For each Transaction, the Scheduled Termination Date set forth in the

 

Supplemental Confirmation (as the same may be postponed in accordance with

 

the provisions hereof); provided that GS&Co. shall have the right to designate

 

any date on or after the First Acceleration Date to be the Termination Date by

 

providing notice to Counterparty of any such designation on such date.

 

 

First Acceleration Date:

For each Transaction, as set forth in the Supplemental Confirmation.

 

 

Hedge Period:

The period from and including the day immediately after the Trade Date to and

 

including the Hedge Completion Date (as adjusted in accordance with the

 

provisions hereof).

 

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Hedge Completion Date:

For each Transaction, as set forth in the Trade Notification, to be the Exchange
Business Day on which GS&Co. finishes establishing its initial Hedge Positions
in respect of such Transaction, as determined by GS&Co. in its sole discretion,
which date shall be subject to any limitations set forth in the Supplemental
Confirmation.

 

 

Hedge Period
Reference Price:

For each Transaction, as set forth in the Trade Notification, to be the average
of the VWAP Prices for each Exchange Business Day in the Hedge Period.

 

 

Market Disruption Event:

The definition of “Market Disruption Event” in Section 6.3(a) of the Equity
Definitions is hereby amended by deleting the words “at any time during the
one-hour period that ends at the relevant Valuation Time” and inserting the
words “at any time on any Scheduled Trading Day during the Hedge Period or
Calculation Period or” after the word “material,” in the third line thereof.

 

 

 

Notwithstanding anything to the contrary in the Equity Definitions, to the
extent that a Disrupted Day occurs in the Hedge Period or the Calculation
Period, the Calculation Agent may in good faith and acting in a commercially
reasonable manner postpone the Hedge Completion Date or the Termination Date, as
the case may be. In such event, the Calculation Agent must determine whether (i)
such Disrupted Day is a Disrupted Day in full, in which case the VWAP Price for
such Disrupted Day shall not be included for purposes of determining the Hedge
Period Reference Price or the Forward Price, as the case may be, or (ii) such
Disrupted Day is a Disrupted Day only in part, in which case the VWAP Price for
such Disrupted Day shall be determined by the Calculation Agent based on Rule
10b-18 eligible transactions in the Shares on such Disrupted Day effected before
the relevant Market Disruption Event occurred and/or after the relevant Market
Disruption Event ended, and the weighting of the VWAP Price for the relevant
Exchange Business Days during the Hedge Period or the Calculation Period, as the
case may be, shall be adjusted in a commercially reasonable manner by the
Calculation Agent for purposes of determining the Hedge Period Reference Price
or the Forward Price, as the case may be, with such adjustments based on, among
other factors, the duration of any Market Disruption Event and the volume,
historical trading patterns and price of the Shares.

 

 

 

If a Disrupted Day occurs during the Hedge Period or the Calculation Period, as
the case may be, and each of the nine immediately following Scheduled Trading
Days is a Disrupted Day, then the Calculation Agent, in its good faith and
commercially reasonable discretion, may either (i) deem such ninth Scheduled
Trading Day to be an Exchange Business Day and determine the VWAP Price for such
ninth Scheduled Trading Day using its good faith estimate of the value of the
Shares on such ninth Scheduled Trading Day based on the volume, historical
trading patterns and price of the Shares and such other factors as it deems
appropriate or (ii) further extend the Hedge Period or the Calculation Period,
as the case may be, as it deems necessary to determine the VWAP Price.

 

 

Exchange:

Nasdaq Global Select Market

 

 

Related Exchange(s):

All Exchanges.

 

 

Prepayment\Variable Obligation:

Applicable

 

 

Prepayment Amount:

For each Transaction, as set forth in the Supplemental Confirmation.

 

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Prepayment Date:

Three (3) Exchange Business Days following the Trade Date.

 

 

 

 

Settlement Terms:

 

 

 

Physical Settlement:

Applicable; provided that GS&Co. does not, and shall not, make the agreement or
the representations set forth in Section 9.11 of the Equity Definitions related
to the restrictions imposed by applicable securities laws with respect to any
Shares delivered by GS&Co. to Counterparty under any Transaction.

 

 

 

 

Number of Shares
to be Delivered:

A number of Shares equal to (a) the Prepayment Amount divided by (b) the Forward
Price minus the Forward Price Adjustment Amount; provided that the Number of
Shares to be Delivered shall not be less than the Minimum Shares and not greater
than the Maximum Shares. The Number of Shares to be Delivered on the Settlement
Date shall be reduced, but not below zero, by any Shares delivered pursuant to
the Minimum Share Delivery described below.

 

 

Excess Dividend Amount:

For the avoidance of doubt, all references to the Excess Dividend Amount shall
be deleted from Section 9.2(a)(iii) of the Equity Definitions.

 

 

Settlement Date:

Three (3) Exchange Business Days following the Termination Date.

 

 

Settlement Currency:

USD

 

 

Initial Share Delivery:

GS&Co. shall deliver a number of Shares equal to the Initial Shares to
Counterparty on the Initial Share Delivery Date in accordance with Section 9.4
of the Equity Definitions, with the Initial Share Delivery Date deemed to be a
“Settlement Date” for purposes of such Section 9.4.

 

 

Initial Share Delivery Date:

The Prepayment Date

 

 

Initial Shares:

For each Transaction, as set forth in the Supplemental Confirmation.

 

 

Minimum Share Delivery:

GS&Co. shall deliver a number of Shares equal to the excess, if any, of the
Minimum Shares over the Initial Shares to Counterparty on the Minimum Share
Delivery Date in accordance with Section 9.4 of the Equity Definitions, with the
Minimum Share Delivery Date deemed to be a “Settlement Date” for purposes of
such Section 9.4.

 

 

Minimum Share Delivery

 

Date:

Three (3) Exchange Business Days following the Hedge Completion Date.

 

 

Minimum Shares:

For each Transaction, as set forth in the Supplemental Confirmation.

 

 

Maximum Shares:

For each Transaction, as set forth in the Supplemental Confirmation.

 

 

Share Adjustments:

 

 

 

Potential Adjustment Event:

Notwithstanding anything to the contrary in Section 11.2(e) of the Equity
Definitions, an Extraordinary Dividend shall not constitute a Potential
Adjustment Event.

 

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Extraordinary Dividend:

For any calendar quarter occurring (in whole or in part) during the period from
and including the first day of the Hedge Period to and including the Termination
Date, any dividend or distribution on the Shares with an ex-dividend date
occurring during such calendar quarter (other than any dividend or distribution
of the type described in Section 11.2(e)(i) or Section 11.2(e)(ii)(A) or (B) of
the Equity Definitions).

 

 

Method of Adjustment:

Calculation Agent Adjustment

 

 

Extraordinary Events:

 

 

 

Consequences of

 

Merger Events and

 

Tender Offers:

 

 

 

(a)     Share-for-Share:

Modified Calculation Agent Adjustment

 

 

(b)     Share-for-Other:

Cancellation and Payment

 

 

(c)     Share-for-Combined:

Component Adjustment

 

 

Determining Party:

GS&Co.

 

 

Tender Offer:

Applicable

 

 

Nationalization, Insolvency or Delisting:

Cancellation and Payment; provided that (i) Section 12.6(a)(iii) of the Equity
Definitions shall be amended by replacing the phrase “(or will cease without any
right of appeal)” in the second line thereof with the phrase (“or will cease
without any condition)” and (ii) in addition to the provisions of Section
12.6(a)(iii) of the Equity Definitions, it shall 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 Select Market or The NASDAQ Global
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 be deemed to be the Exchange.

 

Notwithstanding anything to the contrary in the Equity Definitions, if, as a
result of a Merger Event, a Tender Offer, a Nationalization, an Insolvency or a
Delisting, Cancellation and Payment applies to one or more Transactions
hereunder (whether in whole or in part), an Additional Termination Event (with
the Transactions (or portions thereof) to which Cancellation and Payment applies
being the Affected Transactions, Counterparty being the sole Affected Party and
the Early Termination Date being the date on which such Transactions would be
cancelled pursuant to Article 12 of the Equity Definitions) shall be deemed to
occur, and, in lieu of Sections 12.7 and 12.8 of the Equity Definitions, Section
6 of the Agreement shall apply to such Affected Transactions.

Additional Disruption Events:

(a)

Change in Law:

Applicable

 

 

 

(b)

Failure to Deliver:

Applicable

 

 

 

(c)

Insolvency Filing:

Applicable

 

 

 

(d)

Loss of Stock Borrow:

Applicable; provided that Sections 12.9(a)(vii) and 12.9(b)(iv) of the Equity
Definitions shall be amended by deleting the

 

 

 

 

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words “at a rate equal to or less than the Maximum Stock Loan Rate” and
replacing them with “at a rate of return equal to or greater than zero”.

 

 

Hedging Party:

GS&Co.

 

 

Determining Party:

GS&Co.

 

Notwithstanding anything to the contrary in the Equity Definitions, if, as a
result of an Additional Disruption Event, any Transaction is cancelled or
terminated, an Additional Termination Event (with such terminated Transaction(s)
being the Affected Transaction(s), Counterparty being the sole Affected Party
and the Early Termination Date being the date on which such Transaction(s) would
be cancelled or terminated pursuant to Article 12 of the Equity Definitions)
shall be deemed to occur, and, in lieu of Sections 12.7 and 12.8 of the Equity
Definitions, Section 6 of the Agreement shall apply to such Affected
Transaction(s).

Non-Reliance/Agreements and

 

Acknowledgements Regarding

 

Hedging Activities/Additional

 

Acknowledgements:

Applicable

 

 

Transfer:

Notwithstanding anything to the contrary in the Agreement, GS&Co. may assign,
transfer and set over all rights, title and interest, powers, privileges and
remedies of GS&Co. under this Transaction, in whole or in part, to an affiliate
of GS&Co. whose obligations are guaranteed by The Goldman Sachs Group, Inc.
without the consent of Counterparty.

 

 

GS&Co. Payment Instructions:

Chase Manhattan Bank New York

 

For A/C Goldman, Sachs & Co.

 

A/C #930-1-011483

 

ABA: 021-000021

 

 

Counterparty’s Contact Details

 

for Purpose of Giving Notice:

The Cheesecake Factory Incorporated

 

26901 Malibu Hills Road

 

Calabasas Hills, CA 91301

 

 

GS&Co.’s Contact Details for

 

Purpose of Giving Notice:

Telephone No.:

(212) 902-8996

 

Facsimile No.:

(212) 902-0112

 

Attention: Equity Operations: Options and Derivatives

 

 

 

With a copy to:

 

Tracey McCabe

 

Equity Capital Markets

 

One New York Plaza

 

New York, NY 10004

 

Telephone No.:

(212) 357-0428

 

Facsimile No.:

(212) 902-3000

 

 

2.           Calculation Agent.

GS&Co.

 

3.             Additional Mutual Representations, Warranties and Covenants.  In
addition to the representations and warranties in the Agreement, each party
represents, warrants and covenants to the other party that:

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(a) Eligible Contract Participant.  It is an “eligible contract participant”, as
defined in the U.S. Commodity Exchange Act (as amended), and is entering into
each Transaction hereunder as principal and not for the benefit of any third
party.

(b) Accredited Investor.  Each party acknowledges that the offer and sale of
each Transaction to it is intended to be exempt from registration under the
Securities Act of 1933, as amended (the “Securities Act”), by virtue of Section
4(2) thereof and the provisions of Regulation D thereunder (“Regulation D”). 
Accordingly, each party represents and warrants to the other that (i) it has the
financial ability to bear the economic risk of its investment in each
Transaction and is able to bear a total loss of its investment, (ii) it is an
“accredited investor” as that term is defined under Regulation D and (iii) the
disposition of each Transaction is restricted under this Master Confirmation,
the Securities Act and state securities laws.

4.             Additional Representations, Warranties and Covenants of
Counterparty.  In addition to the representations, warranties and covenants in
the Agreement and those contained herein, as of (i) the date hereof, (ii) the
Trade Date for each Transaction hereunder and (iii) to the extent indicated
below, each day during the Hedge Period and Calculation Period for each
Transaction hereunder, Counterparty represents, warrants and covenants to GS&Co.
that:

(a)           the purchase or writing of each Transaction and the transactions
contemplated hereby will not violate Rule 13e-1 or Rule 13e-4 under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”);

(b)           it is not entering into any Transaction (i) on the basis of, and
is not aware of, any material non-public information with respect to the Shares
(ii) in anticipation of, in connection with, or to facilitate, a distribution of
its securities, a self tender offer or a third-party tender offer or (iii) to
create actual or apparent trading activity in the Shares (or any security
convertible into or exchangeable for the Shares) or otherwise manipulate the
price of the Shares (or any security convertible into or exchangeable for the
Shares);

(c)           each Transaction is being entered into pursuant to a publicly
disclosed Share buy-back program and its Board of Directors has approved the use
of derivatives to effect the Share buy-back program;

(d)           without limiting the generality of Section 13.1 of the Equity
Definitions, it acknowledges that GS&Co. is not making any representations or
warranties with respect to the treatment of any Transaction under FASB
Statements 128, 133 as amended, or 149, 150, EITF 00-19, EITF 03-6 (or any
successor issue statements) or under Financial Accounting Standards Board’s
Liabilities & Equity Project;

(e)           Counterparty is in compliance with its reporting obligations under
the Exchange Act and its most recent Annual Report on Form 10-K, together with
all reports subsequently filed by it pursuant to the Exchange Act, taken
together and as amended and supplemented to the date of this representation, do
not, as of their respective filing dates, contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading;

(f)            Counterparty shall report each Transaction as required under
Regulation S-K and/or Regulation S-B under the Exchange Act, as applicable;

(g)           Counterparty is not, and will not be, engaged in a “distribution”
of Shares or securities that are convertible into, or exchangeable or
exercisable for Shares for purposes of Regulation M promulgated under the
Exchange Act (“Regulation M”) at any time during the Hedge Period or the
Relevant Period for any Transaction unless Counterparty has provided written
notice to GS&Co. of such distribution (a “Regulation M Distribution Notice”) not
later than the Scheduled Trading Day immediately preceding the first day of the
relevant “restricted period” (as defined in Regulation M); Counterparty
acknowledges that any such notice may cause the Hedge Period or the Calculation
Period to be extended or suspended pursuant to Section 5 below; accordingly,
Counterparty acknowledges that its delivery of such notice must comply with the
standards set forth in Section 6 below; “Relevant Period” means, for any
Transaction, the period commencing on the first day of the Calculation Period
and ending on the 20th Exchange Business Day immediately following the end of
the Calculation Period, or such earlier day as elected by GS&Co. and
communicated to Counterparty on such day;

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(h)           Counterparty acknowledges that each Transaction is a derivatives
transaction in which it has granted GS&Co. an option;  GS&Co. may purchase
shares for its own account at an average price that may be greater than, or less
than, the price paid by Counterparty under the terms of the related Transaction;

(i)            as of the Trade Date, the Prepayment Date, the Initial Share
Delivery Date, the Minimum Share Delivery Date and the Settlement Date for each
Transaction, Counterparty is not “insolvent” (as such term is defined under
Section 101(32) of the U.S. Bankruptcy Code (Title 11 of the United States Code)
(the “Bankruptcy Code”)) and Counterparty would be able to purchase a number of
shares equal to the Maximum Shares in compliance with the laws of the
jurisdiction of Counterparty’s incorporation;

(j)            Counterparty is not and, after giving effect to any Transaction,
will not be, required to register as an “investment company” as such term is
defined in the Investment Company Act of 1940, as amended;

(k)           it has not and, during the Hedge Period or Relevant Period for any
Transaction, will not enter into agreements similar to the Transactions
described herein where any initial hedge period (however defined), the
calculation period (however defined) or the relevant period (however defined) in
such other transaction will overlap at any time (including as a result of
extensions in such initial hedge period, calculation period or relevant period
as provided in the relevant agreements) with any Hedge Period or Relevant Period
under this Master Confirmation.  In the event that the initial hedge period,
calculation period or relevant period in any other similar transaction overlaps
with any Hedge Period or Relevant Period under this Master Confirmation as a
result of an extension of the Termination Date pursuant to Section 5 herein,
Counterparty shall promptly amend such transaction to avoid any such overlap.

5.                                       Suspension of Hedge Period or
Calculation Period.

(a) If Counterparty concludes that it will be engaged in a distribution of the
Shares for purposes of Regulation M, Counterparty agrees that it will, on a day
no later than the Scheduled Trading Day immediately preceding the start of the
relevant restricted period, provide GS&Co. with a Regulation M Distribution
Notice.  If on any Scheduled Trading Day Counterparty delivers the Regulation M
Distribution Notice in writing (and confirms by telephone) by 8:30 a.m. New York
Time (the “Notification Time”) then such notice shall be effective as of such
Notification Time.  In the event that Counterparty delivers such Regulation M
Distribution Notice in writing and/or confirms by telephone after the
Notification Time, then such notice shall be effective as of 8:30 a.m. New York
Time on the following Scheduled Trading Day or as otherwise required by law or
agreed between Counterparty and GS&Co.  Upon the effectiveness of such
Regulation M Distribution Notice, the Calculation Period or the Hedge Period, as
the case may be, shall be suspended and the Termination Date or the Hedge
Completion Date or both, as the case may be, shall postponed for each Scheduled
Trading Day in such restricted period; accordingly, Counterparty acknowledges
that its delivery of such notice must comply with the standards set forth in
Section 6 below, including, without limitation, the requirement that such notice
be made at a time at which none of Counterparty or any officer, director,
manager or similar person of Counterparty is aware of any material non-public
information regarding Counterparty or the Shares.

(b) In the event that GS&Co. concludes, in good faith, that it is appropriate
with respect to any legal, regulatory or self-regulatory requirements or related
policies and procedures (whether or not such requirements, policies or
procedures are imposed by law or have been voluntarily adopted by GS&Co.), for
it to refrain from purchasing Shares on any Scheduled Trading Day during the
Hedge Period or the Calculation Period, GS&Co. may by written notice to
Counterparty elect to suspend the Hedge Period or the Calculation Period, or
both, as the case may be, for such number of Scheduled Trading Days as is
specified in the notice.  The notice shall not specify, and GS&Co. shall not
otherwise communicate to Counterparty, the reason for GS&Co.’s election to
suspend the Hedge Period or the Calculation Period, or both, as the case may
be.  The Hedge Period or the Calculation Period, or both, as the case may be,
shall be suspended and the Termination Date shall be extended for each Scheduled
Trading Day occurring during any such suspension.

(c) In the event that the Calculation Period or the Hedge Period, as the case
may be, is suspended pursuant to Section 5(a) or 5(b) above during the regular
trading session on the Exchange, such suspension shall be deemed to

8

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be an additional Market Disruption Event, and the second and third paragraphs
under “Market Disruption Event” shall apply.

(d) In the event that the Calculation Period is extended pursuant to any
provision hereof (including, without limitation, pursuant to Section 9(d)
below), the Calculation Agent, in its commercially reasonable discretion, shall
adjust any relevant terms of the related Transaction if necessary to preserve as
nearly as practicable the economic terms of such Transaction prior to such
extension; provided that Counterparty shall not be required to make any
additional cash payments or deliver any Shares in connection with any such
adjustments.

6.                                       10b5-1 Plan.  Counterparty represents,
warrants and covenants to GS&Co. that for each Transaction:

(a)           Counterparty is entering into this Master Confirmation and each
Transaction hereunder in good faith and not as part of a plan or scheme to evade
the prohibitions of Rule 10b-5 under the Exchange Act.  Counterparty
acknowledges that it is the intent of the parties that each Transaction entered
into under this Master Confirmation comply with the requirements of paragraphs
(c)(1)(i)(A) and (B) of Rule 10b5-1 under the Exchange Act (“Rule 10b5-1”) and
each Transaction entered into under this Master Confirmation shall be
interpreted to comply with the requirements of Rule 10b5-1(c).

(b)           Counterparty will not seek to control or influence GS&Co. to make
“purchases or sales” (within the meaning of Rule 10b5-1(c)(1)(i)(B)(3)) under
any Transaction entered into under this Master Confirmation, including, without
limitation, GS&Co.’s decision to enter into any hedging transactions. 
Counterparty represents and warrants that it has consulted with its own advisors
as to the legal aspects of its adoption and implementation of this Master
Confirmation, each Supplemental Confirmation and each Trade Notification under
Rule 10b5-1.

(c)           Counterparty acknowledges and agrees that any amendment,
modification, waiver or termination of this Master Confirmation, the relevant
Supplemental Confirmation or Trade Notification must be effected in accordance
with the requirements for the amendment or termination of a “plan” as defined in
Rule 10b5-1(c).  Without limiting the generality of the foregoing, any such
amendment, modification, waiver or termination shall be made in good faith and
not as part of a plan or scheme to evade the prohibitions of Rule 10b-5, and no
such amendment, modification, waiver or termination shall be made at any time at
which Counterparty or any officer, director, manager or similar person of
Counterparty is aware of any material non-public information regarding
Counterparty or the Shares.

7.                                       Counterparty Purchases.

Counterparty (or any “affiliated purchaser” as defined in Rule 10b-18 under the
Exchange Act (“Rule 10b-18”)) shall not, without the prior written consent of
GS&Co., directly or indirectly purchase any Shares, listed contracts on the
Shares or securities that are convertible into, or exchangeable or exercisable
for Shares (including, without limitation, any Rule 10b-18 purchases of blocks
(as defined in Rule 10b-18)) during any Hedge Period or Relevant Period (as
extended pursuant to the provisions hereof).  During this time, any such
purchases by Counterparty shall be made through GS&Co., or if not through
GS&Co., with the prior written consent of GS&Co., and in compliance with Rule
10b-18 or otherwise in a manner that Counterparty and GS&Co. believe is in
compliance with applicable requirements.

8.             Additional Termination Event.  The declaration of any
Extraordinary Dividend by the Issuer during the Hedge Period and the Calculation
Period will constitute an Additional Termination Event, with Counterparty as the
sole Affected Party and all Transactions hereunder as the Affected Transactions.

9.             Special Provisions for Merger Transactions.  Notwithstanding
anything to the contrary herein or in the Equity Definitions,

                (a)           Counterparty shall, prior to the opening of
trading in the Shares on any day during any Hedge Period or Calculation Period
on which Counterparty makes, or expects to be made, any public announcement (as
defined in Rule 165(f) under the Securities Act of 1933, as amended) of any
Merger Transaction, notify GS&Co. of such public announcement;

9

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(b)           promptly notify GS&Co. following any such announcement that such
announcement has been made; and

(c)           promptly provide GS&Co. with written notice specifying (i)
Counterparty’s average daily Rule 10b-18 Purchases (as defined in Rule 10b-18)
during the three full calendar months immediately preceding the Announcement
Date that were not effected through GS&Co. or its affiliates and (ii) the number
of Shares purchased pursuant to the proviso in Rule 10b-18(b)(4) under the
Exchange Act for the three full calendar months preceding the Announcement
Date.  Such written notice shall be deemed to be a certification by Counterparty
to GS&Co. that such information is true and correct.  In addition, Counterparty
shall promptly notify GS&Co. of the earlier to occur of the completion of such
transaction and the completion of the vote by target shareholders.  Counterparty
acknowledges that any such notice may cause the terms of any Transaction to be
adjusted or such Transaction to be terminated; accordingly, Counterparty
acknowledges that its delivery of such notice must comply with the standards set
forth in Section 6; and

(d)           GS&Co. in its sole discretion may (i) make adjustments to the
terms of any Transaction, including, without limitation, the Termination Date,
the Forward Price Adjustment Amount and the Maximum Shares to account for the
number of Shares that could be purchased on each day during the Hedge Period or
the Calculation Period in compliance with Rule 10b-18 following such public
announcement, provided that Counterparty shall not be required to make any
additional cash payments or deliver any Shares in connection with any such
adjustments or (ii) treat the occurrence of such public announcement as an
Additional Termination Event with Counterparty as the sole Affected Party.

“Merger Transaction” means any merger, acquisition or similar transaction
involving a recapitalization as contemplated by Rule 10b-18(a)(13)(iv) under the
Exchange Act.

10.                                 Acknowledgments.  The parties hereto intend
for:

(a)             Each Transaction to be a “securities contract” as defined in
Section 741(7) of the Bankruptcy Code, a “swap agreement” as defined in Section
101(53B) of the Bankruptcy Code and a “forward contract” as defined in Section
101(25) of the Bankruptcy Code, and the parties hereto to be entitled to the
protections afforded by, among other Sections, Sections 362(b)(6), 362(b)(17),
362(b)(27), 362(o), 546(e), 546(g), 546(j), 555, 556, 560 and 561 of the
Bankruptcy Code;

(b)             The Agreement to be a “master netting agreement” as defined in
Section 101(38A) of the Bankruptcy Code;

(c)             A party’s right to liquidate or terminate any Transaction, net
out or offset termination values or payment amounts, and to exercise any other
remedies upon the occurrence of any Event of Default or Termination Event under
the Agreement with respect to the other party or any Extraordinary Event that
results in the termination or cancellation of any Transaction to constitute a
“contractual right” (as defined in the Bankruptcy Code);

(d)             Any cash, securities or other property transferred as
performance assurance, credit support or collateral with respect to each
Transaction to constitute “margin payments” and “transfers” (each as defined in
the Bankruptcy Code); and

(e)             All payments for, under or in connection with each Transaction,
all payments for the Shares and the transfer of such Shares to constitute
“settlement payments” and “transfers” (as defined in the Bankruptcy Code).

11.             Credit Support Documents.  The parties hereto acknowledge that
no Transaction hereunder is secured by any collateral that would otherwise
secure the obligations of Counterparty herein or pursuant to the Agreement.

12.             Limitation on Set-off.  (a)  Notwithstanding anything to the
contrary in the Agreement or the Equity Definitions, the calculation of any
Settlement Amounts and Unpaid Amounts shall be calculated separately for (A) all
Terminated Transactions in the Shares of the Issuer that qualify as equity under
applicable accounting rules (collectively, the “Equity Shares”) as determined by
the Calculation Agent and (B) all other Terminated

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Transactions under the Agreement including, without limitation, Transactions in
Shares other than those of the Issuer (collectively, the “Other Shares”) and the
netting and set-off provisions of the Agreement shall only operate to provide
netting and set-off (i) among Terminated Transactions in the Equity Shares and
(ii) among Terminated Transactions in the Other Shares.  In no event shall the
netting and set-off provisions of the Agreement operate to permit netting and
set-off between Terminated Transactions in the Equity Shares and Terminated
Transactions in the Other Shares.

(b)           The parties agree that upon the occurrence of an Event of Default
or Termination Event with respect to a party who is the Defaulting Party or an
Affected Party (“X”), the other party (“Y”) will have the right (but not be
obliged) without prior notice to X or any other person to set-off or apply any
obligation of X owed to Y (or any Affiliate of Y) (whether or not matured or
contingent and whether or not arising under the Agreement, and regardless of the
currency, place of payment or booking office of the obligation) against any
obligation of Y (or any Affiliate of Y) owed to X (whether or not matured or
contingent and whether or not arising under the Agreement, and regardless of the
currency, place of payment or booking office of the obligation).  Y will give
notice to the other party of any set-off effected under this Section 12.

Amounts (or the relevant portion of such amounts) subject to set-off may be
converted by Y into the Termination Currency at the rate of exchange at which
such party would be able, acting in a reasonable manner and in good faith, to
purchase the relevant amount of such currency.  If any obligation is
unascertained, Y may in good faith estimate that obligation and set-off in
respect of the estimate, subject to the relevant party accounting to the other
when the obligation is ascertained.  Nothing in this Section 12 shall be
effective to create a charge or other security interest.  This Section 12 shall
be without prejudice and in addition to any right of set-off, combination of
accounts, lien or other right to which any party is at any time otherwise
entitled (whether by operation of law, contract or otherwise).

(c)           Notwithstanding anything to the contrary in the foregoing, GS&Co.
agrees not to set off or net amounts due from Counterparty with respect to any
Transaction against amounts due from GS&Co. to Counterparty with respect to
contracts or instruments that are not Equity Contracts.  “Equity Contract” means
any transaction or instrument that does not convey rights to GS&Co. senior to
claims of common stockholders in the event of Counterparty’s bankruptcy.

13.           Staggered Delivery of Shares.  (a) GS&Co. may satisfy its
obligation to deliver the Initial Shares on the Initial Share Delivery Date by
making separate deliveries of Shares more than one time on the Initial Share
Delivery Date, so long as the aggregate number of Shares so delivered is equal
to the number of Initial Shares.

(b)                                 GS&Co. may, by prior notice to Counterparty,
elect to deliver the Shares it is required to deliver under “Minimum Share
Delivery” (above) and/or the Number of Shares to be Delivered, as the case may
be, on two or more dates (each, a “Staggered Delivery Date”) and/or at two or
more times on the Staggered Delivery Date as follows:

(i)            in such notice, GS&Co. will specify to Counterparty the related
Staggered Delivery Dates (each of which will be on or prior to the Minimum Share
Delivery Date or the Settlement Date, as the case may be) or delivery times and
how it will allocate the Shares it is required to deliver among the Staggered
Delivery Dates or delivery times; and

(ii)           the aggregate number of Shares that GS&Co. will deliver to
Counterparty hereunder on all such Staggered Delivery Dates and delivery times
relating to the Minimum Share Delivery Date will equal the number of Shares that
GS&Co. would otherwise be required to deliver on the Minimum Share Delivery
Date, and the aggregate number of Shares that GS&Co. will deliver to
Counterparty hereunder on all such Staggered Delivery Dates and delivery times
relating to the Settlement Date will equal the Number of Shares to be Delivered
that GS&Co. would otherwise be required to deliver on the Settlement Date.

14.           Early Termination.  In the event that an Early Termination Date
(whether as a result of an Event of Default or a Termination Event) occurs or is
designated with respect to any Transaction (except as a result of a Merger Event
in which the consideration or proceeds to be paid to holders of Shares consists
solely of cash), if GS&Co. would owe any amount to Counterparty pursuant to
Section 6(d)(ii) of the Agreement (calculated as if the

11

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Transactions being terminated on such Early Termination Date were the sole
Transactions under the Agreement) (any such amount, a “GS&Co. Amount”), then, in
lieu of any payment of such GS&Co. Amount, Counterparty may, no later than the
Early Termination Date or the date on which such Transaction is terminated,
elect for GS&Co. to deliver to Counterparty a number of Shares (or, in the case
of a Merger Event, a number of units, each comprising the number or amount of
the securities or property that a hypothetical holder of one Share would receive
in such Merger Event (each such unit, an “Alternative Delivery Unit” and, the
securities or property comprising such unit, “Alternative Delivery Property”))
with a value equal to the GS&Co. Amount, as determined by the Calculation Agent
(and the parties agree that, in making such determination of value, the
Calculation Agent may take into account a number of factors, including the
market price of the Shares or Alternative Delivery Property on the date of early
termination and the prices at which GS&Co. purchases Shares or Alternative
Delivery Property to fulfill its delivery obligations under this Section 14);
provided that in determining the composition of any Alternative Delivery Unit,
if the relevant Merger Event involves a choice of consideration to be received
by holders, such holder shall be deemed to have elected to receive the maximum
possible amount of cash.

15.           Payment Date upon Early Termination.  Notwithstanding anything to
the contrary in Section 6(d)(ii) of the Agreement, all amounts calculated as
being due in respect of an Early Termination Date under Section 6(e) of the
Agreement will be payable on the day that notice of the amount payable is
effective; provided that if Counterparty elects to receive Shares or Alternative
Delivery Property in accordance with Section 14, such Shares or Alternative
Delivery Property shall be delivered on a date selected by GS&Co as promptly as
practicable.

16.           Special Provisions for Counterparty Payments.  The parties hereby
agree that, notwithstanding anything to the contrary herein or in the Agreement,
in the event that an Early Termination Date (whether as a result of an Event of
Default or a Termination Event) occurs or is designated with respect to any
Transaction and, as a result, Counterparty owes to GS&Co. an amount calculated
under Section 6(e) of the Agreement (calculated as if the Transactions being
terminated on such Early Termination Date were the sole Transactions under the
Agreement), such amount shall be deemed to be zero.

17.           Claim in Bankruptcy.  GS&Co. agrees that in the event of the
bankruptcy of Counterparty, GS&Co. shall not have rights or assert a claim that
is senior in priority to the rights and claims available to the shareholders of
the common stock of Counterparty.

18.           Governing Law.  The Agreement, this Master Confirmation, each
Supplemental Confirmation, each Trade Notification and all matters arising in
connection with the Agreement, this Master Confirmation,  each Supplemental
Confirmation and each Trade Notification shall be governed by, and construed and
enforced in accordance with, the laws of the State of New York (without
reference to its choice of laws doctrine).

19.           Offices.

(a)                                  The Office of GS&Co. for each Transaction
is:  One New York Plaza, New York, New York 10004.

The Office of Counterparty for each Transaction is: 26901 Malibu Hills Road,
Calabasas Hills, CA 91301.

20.           Arbitration.  The Agreement, this Master Confirmation, each
Supplemental Confirmation and each Trade Notification are subject to the
following arbitration provisions:

(a)                                  All parties to this Confirmation are giving
up the right to sue each other in court, including the right to a trial by jury,
except as provided by the rules of the arbitration forum in which a claim is
filed.

(b)                                  Arbitration awards are generally final and
binding; a party’s ability to have a court reverse or modify an arbitration
award is very limited.

(c)                                  The ability of the parties to obtain
documents, witness statements and other discovery is generally more limited in
arbitration than in court proceedings.

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(d)                                  The arbitrators do not have to explain the
reason(s) for their award.

(e)                                  The panel of arbitrators will typically
include a minority of arbitrators who were or are affiliated with the securities
industry, unless Counterparty is a member of the organization sponsoring the
arbitration facility, in which case all arbitrators may be affiliated with the
securities industry.

(f)                                    The rules of some arbitration forums may
impose time limits for bringing a claim in arbitration.  In some cases, a claim
that is ineligible for arbitration may be brought in court.

(g)                                 The rules of the arbitration forum in which
the claim is filed, and any amendments thereto, shall be incorporated into this
Confirmation.

Counterparty agrees that any and all controversies that may arise between
Counterparty and GS&Co., including, but not limited to, those arising out of or
relating to the Agreement or any Transaction hereunder, shall be determined by
arbitration conducted before The New York Stock Exchange, Inc. (“NYSE”) or NASD
Dispute Resolution (“NASD-DR”), or, if the NYSE and NASD-DR decline to hear the
matter, before the American Arbitration Association, in accordance with their
arbitration rules then in force.  The award of the arbitrator shall be final,
and judgment upon the award rendered may be entered in any court, state or
federal, having jurisdiction.

No person shall bring a putative or certified class action to arbitration, nor
seek to enforce any pre-dispute arbitration agreement against any person who has
initiated in court a putative class action or who is a member of a putative
class who has not opted out of the class with respect to any claims encompassed
by the putative class action until: (i) the class certification is denied; (ii)
the class is decertified; or (iii) Counterparty is excluded from the class by
the court.

Such forbearance to enforce an agreement to arbitrate shall not constitute a
waiver of any rights under this Confirmation except to the extent stated
herein.”

21.           Counterparts. This Master Confirmation may be executed in any
number of counterparts, all of which shall constitute one and the same
instrument, and any party hereto may execute this Master Confirmation by signing
and delivering one or more counterparts.

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22.           Counterparty hereby agrees (a) to check this Master Confirmation
carefully and immediately upon receipt so that errors or discrepancies can be
promptly identified and rectified and (b) to confirm that the foregoing (in the
exact form provided by GS&Co.) correctly sets forth the terms of the agreement
between GS&Co. and Counterparty with respect to any particular Transaction to
which this Master Confirmation relates, by manually signing this Master
Confirmation or this page hereof as evidence of agreement to such terms and
providing the other information requested herein and immediately returning an
executed copy to Equity Derivatives Documentation Department, Facsimile No.
212-428-1980/83.

Yours faithfully,

 

 

 

 

 

 

 

 

 

GOLDMAN, SACHS & CO.

 

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

 

Name:

 

 

 

Title:

 

Agreed and Accepted By:

 

THE CHEESECAKE FACTORY INCORPORATED

 

 

By:

 

 

 

Name:

 

Title:

--------------------------------------------------------------------------------

SCHEDULE A

SUPPLEMENTAL CONFIRMATION

 

The Cheesecake Factory Incorporated

 

To:

26901 Malibu Hills Road

 

 

Calabasas Hills, CA 91301

 

 

 

 

From:

Goldman, Sachs & Co.

 

 

 

 

Subject:

Collared Accelerated Stock Buyback

 

 

 

 

Ref. No:

[Insert Reference No.]

 

 

 

 

Date:

[Insert Date]

 

The purpose of this Supplemental Confirmation is to confirm the terms and
conditions of the Transaction entered into between Goldman, Sachs & Co.
(“GS&Co.”) and The Cheesecake Factory Incorporated (“Counterparty”) (together,
the “Contracting Parties”) on the Trade Date specified below.  This Supplemental
Confirmation is a binding contract between GS&Co. and Counterparty as of the
relevant Trade Date for the Transaction referenced below.

1.             This Supplemental Confirmation supplements, forms part of, and is
subject to the Master Confirmation dated as of March 12, 2007 (the “Master
Confirmation”) between the Contracting Parties, as amended and supplemented from
time to time.  All provisions contained in the Master Confirmation govern this
Supplemental Confirmation except as expressly modified below.

2.                                       The terms of the Transaction to which
this Supplemental Confirmation relates are as follows:

Trade Date:

[         ]

 

 

Forward Price Adjustment Amount:

USD [   ]

 

 

Hedge Completion Date:

As set forth in the Trade Notification, but in no event later than

 

[         ].

 

 

Scheduled Termination Date:

As set forth in the Trade Notification, to be the date that follows

 

the Hedge Completion Date by [         ] months.

 

 

First Acceleration Date:

As set forth in the Trade Notification, to be the date that follows

 

the Hedge Completion Date by [         ] months.

 

 

Prepayment Amount:

USD [         ]

 

 

Initial Shares:

[         ]

 

 

Minimum Shares:

As set forth in the Trade Notification, to be a number of shares equal to (a)
the Prepayment Amount divided by (b) [         ] % of the Hedge Period Reference
Price.

 

 

Maximum Shares:

As set for in the Trade Notification, to be a number of shares equal to (a) the
Prepayment Amount divided by (b) [         ] % of the Hedge Period Reference
Price.

 

--------------------------------------------------------------------------------

3.             Counterparty represents and warrants to GS&Co. that neither it
nor any “affiliated purchaser” (as defined in Rule 10b-18 under the Exchange
Act) has made any purchases of blocks pursuant to the proviso in Rule
10b-18(b)(4) under the Exchange Act during the four full calendar weeks
immediately preceding the Trade Date.

4.             This Supplemental Confirmation may be executed in any number of
counterparts, all of which shall constitute one and the same instrument, and any
party hereto may execute this Supplemental Confirmation by signing and
delivering one or more counterparts.

Counterparty hereby agrees (a) to check this Supplemental Confirmation carefully
and immediately upon receipt so that errors or discrepancies can be promptly
identified and rectified and (b) to confirm that the foregoing (in the exact
form provided by GS&Co.) correctly sets forth the terms of the agreement between
GS&Co. and Counterparty with respect to this Transaction, by manually signing
this Supplemental Confirmation or this page hereof as evidence of agreement to
such terms and providing the other information requested herein and immediately
returning an executed copy to Equity Derivatives Documentation Department,
facsimile No. 212-428-1980/83.

Yours sincerely,

 

 

 

GOLDMAN, SACHS & CO.

 

 

 

 

 

By:

 

 

 

Authorized Signatory

 

Agreed and Accepted By:

 

THE CHEESECAKE FACTORY INCORPORATED

 

 

By:

 

 

 

Name:

 

Title:

--------------------------------------------------------------------------------

SCHEDULE B

TRADE NOTIFICATION

To:

The Cheesecake Factory Incorporated
26901 Malibu Hills Road
Calabasas Hills, CA 91301

 

 

From:

Goldman, Sachs & Co.

 

 

Subject:

Collared Accelerated Stock Buyback

 

 

Ref. No:

[Insert Reference No.]

 

 

Date:

[Insert Date]

 

The purpose of this Trade Notification is to notify you of certain terms in the
Transaction entered into between Goldman, Sachs & Co. (“GS&Co.”) and The
Cheesecake Factory Incorporated (“Counterparty”) (together, the “Contracting
Parties”) on the Trade Date specified below.

This Trade Notification supplements, forms part of, and is subject to the
Supplemental Confirmation dated as of [Insert Date of Supplemental Confirmation]
(the “Supplemental Confirmation”) between the Contracting Parties, as amended
and supplemented from time to time. The Supplemental Confirmation is subject to
the Master Confirmation dated as of March 12, 2007 (the “Master Confirmation”)
between the Contracting Parties, as amended and supplemented from time to time.
All provisions contained in the Master Confirmation and the Supplemental
Confirmation govern this Trade Notification except as expressly modified below.

Trade Date:

[      ], 2007

 

 

Hedge Completion Date:

[           ]

 

 

Scheduled Termination Date:

[      ]

 

 

First Acceleration Date:

[           ][or, if such date is not an Exchange Business Day, the next
following Exchange Business Day.]

 

 

Hedge Period Reference Price:

USD[      ]

 

 

Minimum Shares:

[    ]

 

 

Maximum Shares:

[    ]

 

Yours sincerely,

 

 

 

 

 

GOLDMAN, SACHS & CO.

 

 

 

By:

 

 

 

 

Authorized Signatory

 

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