Exhibit 10.1

[Insert Dealer letterhead]

 

To:

  

DICK’S Sporting Goods, Inc.

345 Court Street

Coraopolis, PA 15108

Attention:             [     ]

Telephone No.:    [    ]

Email:                   [    ]

From:

  

[Dealer Name]

Re:

  

[Base] [Additional] Call Option Transaction

Date:

  

April [    ], 2020

 

 

Dear Ladies and Gentlemen:

The purpose of this letter agreement (this “Confirmation”) is to confirm the
terms and conditions of the call option transaction entered into between [Dealer
Name] (“Dealer”)[, through its agent [Agent Name] (“Agent”)] and DICK’S Sporting
Goods, Inc. (“Counterparty”) as of the Trade Date specified below (the
“Transaction”). This letter agreement constitutes a “Confirmation” as referred
to in the ISDA Master Agreement specified below. This Confirmation shall replace
any previous agreements for the Transaction.

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. (“ISDA”) are incorporated into this
Confirmation. In the event of any inconsistency between the Equity Definitions
and this Confirmation, this Confirmation shall govern. Certain defined terms
used herein are based on terms that are defined in the Offering Memorandum dated
April 14, 2020 (the “Offering Memorandum”) relating to the 3.25% Convertible
Senior Notes due 2025 (as originally issued by Counterparty, the “Convertible
Notes” and each USD 1,000 principal amount of Convertible Notes, a “Convertible
Note”) issued by Counterparty in an aggregate initial principal amount of USD
500,000,000 (as increased by [up to] an aggregate principal amount of USD
[75,000,000] [if and to the extent that] [pursuant to the exercise by] the
Initial Purchasers (as defined herein) [exercise] [of] their option to purchase
additional Convertible Notes pursuant to the Purchase Agreement (as defined
herein)) pursuant to an Indenture [to be] dated April 17, 2020 between
Counterparty and U.S. Bank National Association, as trustee (the “Indenture”).
In the event of any inconsistency between the terms defined in the Offering
Memorandum, the Indenture and this Confirmation, this Confirmation shall govern;
provided that in the event of any inconsistency between any term used herein as
defined in the Indenture and the Equity Definitions, the definition of such term
in the Indenture shall govern notwithstanding the incorporation of the Equity
Definitions into this Confirmation. The parties acknowledge that this
Confirmation is entered into on the date hereof with the understanding that
(i) definitions set forth in the Indenture which are also defined herein by
reference to the Indenture and (ii) sections of the Indenture that are referred
to herein will conform to the descriptions thereof in the Offering Memorandum.
If any such definitions in the Indenture or any such sections of the Indenture
differ from the descriptions thereof in the Offering Memorandum, the
descriptions thereof in the Offering Memorandum will govern for purposes of this
Confirmation. The parties further acknowledge that the Indenture section numbers
used herein are based on the [draft of the Indenture last reviewed by Dealer as
of the date of this Confirmation, and if any such section numbers are changed in
the Indenture as executed, the parties will amend this Confirmation in good
faith to preserve the intent of the parties] [Indenture as executed]. Subject to
the foregoing, references to the Indenture herein are references to the
Indenture as in effect on the date of its execution, and if the Indenture is
amended or supplemented following such date (other than any amendment or
supplement (x) pursuant to Section 8.01(I) of the Indenture that, as determined
by the Calculation Agent, conforms the Indenture to the description of
Convertible Notes in the Offering Memorandum or (y) pursuant to Section 5.09 of
the Indenture, subject, in the case of this clause (y), to the second paragraph
under “Method of Adjustment” in Section 3), any such amendment or supplement
will be disregarded for purposes of this Confirmation (other than as provided in
Section 9(j)(iii) below) unless the parties agree otherwise in writing. For
purposes of the Equity Definitions, the Transaction shall be deemed a Share
Option Transaction.

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Each party is hereby advised, and each such party acknowledges, that the other
party has engaged in, or refrained from engaging in, substantial financial
transactions and has taken other material actions in reliance upon the parties’
entry into the Transaction to which this Confirmation relates on the terms and
conditions set forth below.

1.                 This Confirmation evidences a complete and binding agreement
between Dealer and Counterparty as to the terms of the Transaction to which this
Confirmation relates. This Confirmation shall supplement, form a part of, and be
subject to an agreement in the form of the 2002 ISDA Master Agreement (the
“Agreement”) as if Dealer and Counterparty had executed an agreement in such
form on the Trade Date (but without any Schedule except for (i) the election of
the laws of the State of New York as the governing law (without reference to
choice of law doctrine) on the Trade Date, (ii) in respect of Section 5(a)(vi)
of the Agreement, the election that the “Cross Default” provisions shall apply
to Dealer with (a) a “Threshold Amount” with respect to Dealer of three percent
of the Shareholders’ Equity of [Dealer][Dealer’s Parent (“Dealer Parent”)] as of
the Trade Date (where “Shareholders’ Equity” means with respect to any entity,
at any time, the sum (as shown in the most recent annual audited financial
statements of such entity) of (1) its capital stock (including preferred stock)
outstanding, taken at par value, (2) its capital surplus and (3) its retained
earnings, minus (4) treasury stock, each to be determined in accordance with
generally accepted accounting principles), (b) the deletion of the phrase “, or
becoming capable at such time of being declared,” from clause (1) and (c) the
following language added to the end thereof: “Notwithstanding the foregoing, a
default under subsection (2) hereof shall not constitute an Event of Default if
(x) the default was caused solely by error or omission of an administrative or
operational nature; (y) funds were available to enable the party to make the
payment when due; and (z) the payment is made within two Local Business Days of
such party’s receipt of written notice of its failure to pay.”, (iii) the term
“Specified Indebtedness” shall have the meaning specified in Section 14 of the
Agreement, except that such term shall not include obligations in respect of
deposits received in the ordinary course of a party’s banking business, and
(iv) following the payment of the Premium, the condition precedent in
Section 2(a)(iii) of the Agreement with respect to Events of Default or
Potential Events of Default (other than an Event of Default or Potential Event
of Default arising under Section 5(a)(ii), 5(a)(iv) or 5(a)(vii) of the
Agreement) shall not apply to a payment or delivery owing by Dealer to
Counterparty). In the event of any inconsistency between provisions of the
Agreement and this Confirmation, this Confirmation will prevail for the purpose
of the Transaction to which this Confirmation relates. The parties hereby agree
that no transaction other than the Transaction to which this Confirmation
relates shall be governed by the Agreement.

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

General Terms.

 

Trade Date:

  

April [14], 2020

Effective Date:

  

The second Scheduled Trading Day immediately prior to the Premium Payment Date,
subject to Section 9(x).

Option Style:

  

“Modified American”, as described under “Procedures for Exercise” below.

Option Type:

  

Call

Buyer:

  

Counterparty

Seller:

  

Dealer

Shares:

  

The common stock of DICK’S Sporting Goods, Inc. (“Issuer”), par value USD 0.01
per share (Exchange symbol “DKS”).

Number of Options:

  

[    ]. For the avoidance of doubt, the Number of Options shall be reduced
(x) by any Options exercised by Counterparty and (y) immediately following the
occurrence of any Repayment Event by the number of Repayment Options for such
Repayment Event. In no event will the Number of Options be less than zero.

 

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Applicable Percentage:

  

[    ]%

Option Entitlement:

  

A number equal to the product of the Applicable Percentage and [    ].

Strike Price:

  

USD [    ]

Premium:

  

USD [                    ]

Premium Payment Date:

  

April [17], 2020

Exchange:

  

The New York Stock Exchange

Related Exchange(s):

  

All Exchanges

Excluded Provisions:

  

Section 5.07 and Section 5.06 of the Indenture.

Procedures for Exercise.

 

Conversion Date:

  

With respect to any conversion of a Convertible Note (other than (x) any
conversion of Convertible Notes with a Conversion Date occurring prior to the
Free Convertibility Date or (y) any conversion of Convertible Notes in respect
of which the holder of such Convertible Note would be entitled to an increase in
the Convertible Rate pursuant to Section 5.07 of the Indenture (any such
conversion described in clause (x) or (y), an “Early Conversion”), to which the
provisions of Section 9(j)(iv) of this Confirmation shall apply), the date on
which the Holder (as such term is defined in the Indenture) of such Convertible
Note satisfies all of the requirements for conversion thereof as set forth in
Section 5.02(A) of the Indenture; provided that, subject to the “Notice of
Exercise” provisions below, if Counterparty has not delivered to Dealer a
related Notice of Exercise, then in no event shall a Conversion Date be deemed
to occur hereunder (and no Option shall be exercised or deemed to be exercised
hereunder) with respect to any surrender of a Convertible Note for conversion in
respect of which Counterparty has elected to designate a financial institution
for exchange in lieu of conversion of such Convertible Note pursuant to
Section 5.08 of the Indenture.

Free Convertibility Date:

  

December 2, 2024

Expiration Time:

  

The Valuation Time

Expiration Date:

  

April 15, 2025, subject to earlier exercise.

Multiple Exercise:

  

Applicable, as described under “Automatic Exercise” below.

Automatic Exercise:

  

Notwithstanding Section 3.4 of the Equity Definitions, on each Conversion Date
occurring on or after the Free Convertibility Date in respect of which a “Notice
of Conversion” (as defined in the Indenture) that is effective as to
Counterparty has been delivered by the relevant converting Holder, a number of
Options equal to [(i)] the

 

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number of Convertible Notes in denominations of USD 1,000 as to which such
Conversion Date has occurred [minus (ii) the number of Options that are or are
deemed to be automatically exercised on such Conversion Date under the Base Call
Option Transaction Confirmation letter agreement dated April [14], 2020 between
Dealer and Counterparty (the “Base Call Option Confirmation”),] shall be deemed
to be automatically exercised; provided that such Options shall be exercised or
deemed exercised only if Counterparty has provided a Notice of Exercise to
Dealer in accordance with “Notice of Exercise” below.

  

Notwithstanding the foregoing, in no event shall the number of Options that are
exercised or deemed exercised hereunder exceed the Number of Options.

Notice of Exercise:

  

Notwithstanding anything to the contrary in the Equity Definitions or under
“Automatic Exercise” above, in order to exercise any Options relating to
Convertible Notes with a Conversion Date occurring on or after the Free
Convertibility Date, Counterparty must notify Dealer in writing (which, for the
avoidance of doubt, may be by email) before 5:00 p.m. (New York City time) on
the Scheduled Valid Day immediately preceding the Expiration Date specifying the
number of such Options; provided that, notwithstanding the foregoing, such
notice (and the related exercise of Options hereunder) shall be effective if
given after the applicable notice deadline specified above but prior to 5:00
p.m. (New York City time) on the fifth Exchange Business Day following such
notice deadline, in which event the Calculation Agent shall have the right to
adjust Dealer’s delivery obligation hereunder, with respect to the exercise of
such Options, as appropriate to reflect the additional commercially reasonable
costs and losses (limited to losses as a result of hedging mismatches and market
losses) and expenses incurred by Dealer or any of its affiliates in connection
with its hedging activities with such adjustments made assuming that Dealer
maintains commercially reasonable hedge positions (including the unwinding of
any hedge position) as a result of its not having received such notice prior to
such notice deadline (it being understood that the adjusted delivery obligation
described in the preceding proviso can never be less than zero and can never
require any payment by Counterparty); provided, further, that if the Relevant
Settlement Method for such Options is (x) Net Share Settlement and the Specified
Cash Amount (as defined below) is not USD 1,000, (y) Cash Settlement or
(z) Combination Settlement, Dealer shall have received a separate notice (the
“Notice of Final Settlement Method”) (which, for the avoidance of doubt, may be
by email) in respect of all such Convertible Notes before 5:00 p.m. (New York
City time) on the Free Convertibility Date specifying (1) the Relevant
Settlement Method for such Options, and (2) if the settlement method for the
related Convertible Notes is not Settlement in Shares or Settlement

 

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in Cash (each as defined below), the fixed amount of cash per Convertible Note
that Counterparty has elected to deliver to Holders (as such term is defined in
the Indenture) of the related Convertible Notes (the “Specified Cash Amount”).
Counterparty acknowledges its responsibilities under applicable securities laws,
and in particular Section 9 and Section 10(b) of the Securities Exchange Act of
1934, as amended (the “Exchange Act”) and the rules and regulations thereunder,
in respect of any election of a settlement method with respect to the
Convertible Notes.

Valuation Time:

  

At the close of trading of the regular trading session on the Exchange; provided
that if the principal trading session is extended, the Calculation Agent shall
determine the Valuation Time.

Market Disruption Event:

  

Section 6.3(a) of the Equity Definitions is hereby replaced in its entirety by
the following:

  

“‘Market Disruption Event’ means, in respect of a Share, (i) a failure by the
primary United States national or regional securities exchange or market on
which the Shares are listed or admitted for trading to open for trading during
its regular trading session or (ii) the occurrence or existence prior to 1:00
p.m. (New York City time) on any Scheduled Valid Day for the Shares for more
than one half-hour period in the aggregate during regular trading hours of any
suspension or limitation imposed on trading (by reason of movements in price
exceeding limits permitted by the relevant stock exchange or otherwise) in the
Shares or in any options contracts or futures contracts relating to the Shares.”

Settlement Terms.

 

Settlement Method:

  

For any Option, Net Share Settlement; provided that if the Relevant Settlement
Method set forth below for such Option is not Net Share Settlement, then the
Settlement Method for such Option shall be such Relevant Settlement Method, but
only if Counterparty shall have notified Dealer of the Relevant Settlement
Method in the Notice of Exercise or the Notice of Final Settlement Method, as
applicable, for such Option.

Relevant Settlement Method:

  

In respect of any Option:

  

(i) if Counterparty has elected, or is deemed to have elected, to settle its
conversion obligations in respect of the related Convertible Note (A) entirely
in Shares pursuant to Section 5.03(A)(x) of the Indenture (together with cash in
lieu of fractional Shares) (such settlement method, “Settlement in Shares”), (B)
in a combination of cash and Shares pursuant to Section 5.03(A)(z) of the
Indenture with a Specified Cash Amount less than USD 1,000 (such settlement
method “Low Cash Combination Settlement”) or (C) in a combination of cash and
Shares pursuant to Section 5.03(A)(z) of the Indenture with a

 

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Specified Cash Amount equal to USD 1,000, then, in each case, the Relevant
Settlement Method for such Option shall be Net Share Settlement;

  

(ii) if Counterparty has elected to settle its conversion obligations in respect
of the related Convertible Note in a combination of cash and Shares pursuant to
Section 5.03(A)(z) of the Indenture with a Specified Cash Amount greater than
USD 1,000, then the Relevant Settlement Method for such Option shall be
Combination Settlement; and

  

(iii) if Counterparty has elected to settle its conversion obligations in
respect of the related Convertible Note entirely in cash pursuant to
Section 5.03(A)(y) of the Indenture (such settlement method, “Settlement in
Cash”), then the Relevant Settlement Method for such Option shall be Cash
Settlement.

Net Share Settlement:

  

If Net Share Settlement is applicable to any Option exercised or deemed
exercised hereunder, Dealer will deliver to Counterparty, on the relevant
Settlement Date for each such Option, a number of Shares (the “Net Share
Settlement Amount”) equal to the sum, for each Valid Day during the Settlement
Averaging Period for each such Option, of (i) (a) the Daily Option Value for
such Valid Day, divided by (b) the Relevant Price on such Valid Day, divided by
(ii) the number of Valid Days in the Settlement Averaging Period; provided that
in no event shall the Net Share Settlement Amount for any Option exceed a number
of Shares equal to the Applicable Limit for such Option divided by the
Applicable Limit Price on the Settlement Date for such Option.

  

Dealer will pay cash in lieu of delivering any fractional Shares to be delivered
with respect to any Net Share Settlement Amount valued at the Relevant Price for
the last Valid Day of the Settlement Averaging Period.

Combination Settlement:

  

If Combination Settlement is applicable to any Option exercised or deemed
exercised hereunder, Dealer will pay or deliver, as the case may be, to
Counterparty, on the relevant Settlement Date for each such Option:

  

(i)  cash (the “Combination Settlement Cash Amount”) equal to the sum, for each
Valid Day during the Settlement Averaging Period for such Option, of (A) an
amount (the “Daily Combination Settlement Cash Amount”) equal to the lesser of
(1) the product of (x) the Applicable Percentage and (y) the Specified Cash
Amount minus USD 1,000 and (2) the Daily Option Value, divided by (B) the number
of Valid Days in the Settlement Averaging Period; provided that if the
calculation in clause (A) above results in zero or a negative number for any
Valid Day, the Daily Combination Settlement Cash

 

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Amount for such Valid Day shall be deemed to be zero; and

  

(ii)   Shares (the “Combination Settlement Share Amount”) equal to the sum, for
each Valid Day during the Settlement Averaging Period for such Option, of a
number of Shares for such Valid Day (the “Daily Combination Settlement Share
Amount”) equal to (A) (1) the Daily Option Value on such Valid Day minus the
Daily Combination Settlement Cash Amount for such Valid Day, divided by (2) the
Relevant Price on such Valid Day, divided by (B) the number of Valid Days in the
Settlement Averaging Period; provided that if the calculation in sub-clause
(A)(1) above results in zero or a negative number for any Valid Day, the Daily
Combination Settlement Share Amount for such Valid Day shall be deemed to be
zero;

  

provided that in no event shall the sum of (x) the Combination Settlement Cash
Amount for any Option and (y) the Combination Settlement Share Amount for such
Option multiplied by the Applicable Limit Price on the Settlement Date for such
Option, exceed the Applicable Limit for such Option.

  

Dealer will pay cash in lieu of delivering any fractional Shares to be delivered
with respect to any Combination Settlement Share Amount valued at the Relevant
Price for the last Valid Day of the Settlement Averaging Period.

Cash Settlement:

  

If Cash Settlement is applicable to any Option exercised or deemed exercised
hereunder, in lieu of Section 8.1 of the Equity Definitions, Dealer will pay to
Counterparty, on the relevant Settlement Date for each such Option, an amount of
cash (the “Cash Settlement Amount”) equal to the sum, for each Valid Day during
the Settlement Averaging Period for such Option, of (i) the Daily Option Value
for such Valid Day, divided by (ii) the number of Valid Days in the Settlement
Averaging Period.

Daily Option Value:

  

For any Valid Day, an amount equal to (i) the Option Entitlement on such Valid
Day, multiplied by (ii) the Relevant Price on such Valid Day less the Strike
Price on such Valid Day; provided that if the calculation contained in clause
(ii) above results in a negative number, the Daily Option Value for such Valid
Day shall be deemed to be zero. In no event will the Daily Option Value be less
than zero.

Applicable Limit:

  

For any Option, an amount of cash equal to the Applicable Percentage multiplied
by the excess of (i) the aggregate of (A) the amount of cash, if any, paid to
the Holder of the related Convertible Note upon conversion of such Convertible
Note and (B) the number of Shares, if any, delivered to the Holder of the
related Convertible Note upon conversion of such Convertible Note multiplied by

 

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the Applicable Limit Price on the Settlement Date for such Option, over
(ii) USD 1,000.

Applicable Limit Price:

  

On any day, the opening price as displayed under the heading “Op” on Bloomberg
page DKS <equity> (or any successor thereto).

Valid Day:

  

A day on which (i) there is no Market Disruption Event and (ii) trading in the
Shares generally occurs on the Exchange or, if the Shares are not then listed on
the Exchange, on the principal other United States national or regional
securities exchange on which the Shares are then listed or, if the Shares are
not then listed on a United States national or regional securities exchange, on
the principal other market on which the Shares are then listed or admitted for
trading. If the Shares are not so listed or admitted for trading, “Valid Day”
means a Business Day.

Scheduled Valid Day:

  

A day that is scheduled to be a Valid Day on the principal U.S. national or
regional securities exchange or market on which the Shares are listed or
admitted for trading. If the Shares are not so listed or admitted for trading,
“Scheduled Valid Day” means a Business Day.

Business Day:

  

Any day other than a Saturday, a Sunday or a day on which the Federal Reserve
Bank of New York is authorized or required by law or executive order to close or
be closed.

Relevant Price:

  

On any Valid Day, the per Share volume-weighted average price as displayed under
the heading “Bloomberg VWAP” on Bloomberg page DKS <equity> AQR (or its
equivalent successor if such page is not available) in respect of the period
from the scheduled opening time of the Exchange to the Scheduled Closing Time of
the Exchange on such Valid Day (or if such volume-weighted average price is
unavailable at such time, the market value of one Share on such Valid Day, as
determined by the Calculation Agent using, if practicable, a volume-weighted
average method). The Relevant Price will be determined without regard to
after-hours trading or any other trading outside of the regular trading session
trading hours.

Settlement Averaging Period:

  

For any Option, the 40 consecutive Valid Days commencing on, and including, the
41st Scheduled Valid Day immediately prior to the Expiration Date; provided that
if the Notice of Final Settlement Method or Notice of Exercise, as applicable,
for such Option specifies that Settlement in Shares or Low Cash Combination
Settlement applies to the related Convertible Note, the Settlement Averaging
Period shall be the 60 consecutive Valid Days commencing on, and including, the
61st Scheduled Valid Day immediately prior to the Expiration Date.

Settlement Date:

  

For any Option, the second Business Day immediately following the final Valid
Day of the Settlement Averaging Period for such Option.

 

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Settlement Currency:

  

USD

Other Applicable Provisions:

  

The provisions of Sections 9.1(c), 9.8, 9.9 and 9.11 of the Equity Definitions
will be applicable, except that all references in such provisions to
“Physically-settled” shall be read as references to “Share Settled”. “Share
Settled” in relation to any Option means that Net Share Settlement or
Combination Settlement is applicable to that Option.

Representation and Agreement:

  

Notwithstanding anything to the contrary in the Equity Definitions (including,
but not limited to, Section 9.11 thereof), the parties acknowledge that (i) any
Shares delivered to Counterparty shall be, upon delivery, subject to
restrictions and limitations arising from Counterparty’s status as issuer of the
Shares under applicable securities laws, (ii) Dealer may deliver any Shares
required to be delivered hereunder in certificated form in lieu of delivery
through the Clearance System and (iii) any Shares delivered to Counterparty may
be “restricted securities” (as defined in Rule 144 under the Securities Act of
1933, as amended (the “Securities Act”)).

3.                 Additional Terms applicable to the Transaction.

Adjustments applicable to the Transaction:

 

Potential Adjustment Events:

  

Notwithstanding Section 11.2(e) of the Equity Definitions (which Section shall
not apply for purposes of the Transaction), a “Potential Adjustment Event” means
an occurrence of any event or condition, as set forth in any Dilution Adjustment
Provision, that would result in an adjustment under the Indenture to the
“Conversion Rate” or the composition of a “unit of Reference Property” or to any
“Last Reported Sale Price”, “Daily VWAP,” “Daily Conversion Value” or “Daily
Settlement Amount” (each as defined in the Indenture). For the avoidance of
doubt, Dealer shall not have any delivery or payment obligation hereunder, and
no adjustment shall be made to the terms of the Transaction, on account of
(x) any distribution of cash, property or securities by Counterparty to holders
of the Convertible Notes (upon conversion or otherwise) or (y) any other
transaction in which holders of the Convertible Notes are entitled to
participate, in each case, in lieu of an adjustment under the Indenture of the
type referred to in the immediately preceding sentence (including, without
limitation, pursuant to the proviso in the first sentence of
Section 5.05(A)(iii)(1) of the Indenture or the proviso in the first sentence of
Section 5.05(A)(iv) of the Indenture).

Method of Adjustment:

  

Calculation Agent Adjustment, which means that, notwithstanding Section 11.2(c)
of the Equity Definitions (which Section shall not apply for purposes of the
Transaction), upon any Potential Adjustment Event, the Calculation Agent shall
make a corresponding adjustment to any related adjustment required to be made
pursuant to the terms of the Indenture to any one or more of the Strike

 

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Price, Number of Options, Option Entitlement and any other variable relevant to
the exercise, settlement or payment for the Transaction.

  

Notwithstanding the foregoing and “Consequences of Merger Events / Tender
Offers” below:

  

(i)  if the Calculation Agent in good faith disagrees with any adjustment to the
Convertible Notes that involves an exercise of discretion by Counterparty or its
board of directors or a committee thereof (including, without limitation,
pursuant to Section 5.05(H) of the Indenture, Section 5.09 of the Indenture or
any supplemental indenture entered into thereunder or in connection with any
proportional adjustment or the determination of the fair value of any
securities, property, rights or other assets), then in each such case, the
Calculation Agent will determine the adjustment to be made to any one or more of
the Strike Price, Number of Options, Option Entitlement and any other variable
relevant to the exercise, settlement or payment for the Transaction taking into
account the relevant provisions of the Indenture; provided that, notwithstanding
the foregoing, if any Potential Adjustment Event occurs during the Settlement
Averaging Period but no adjustment was made to any Convertible Note under the
Indenture because the relevant Holder (as such term is defined in the Indenture)
was deemed to be a record owner of the underlying Shares on the related
Conversion Date, then the Calculation Agent shall make an adjustment to the
terms hereof in order to account for such Potential Adjustment Event;

  

(ii)   in connection with any Potential Adjustment Event as a result of an event
or condition set forth in Section 5.05(A)(ii) of the Indenture or
Section 5.05(A)(iii) of the Indenture where, in either case, the period for
determining “Y” (as such term is used in Section 5.05(A)(ii) of the Indenture)
or “SP” (as such term is used in Section 5.05(A)(iii) of the Indenture), as the
case may be, begins before Counterparty has publicly announced the event or
condition giving rise to such Potential Adjustment Event, then the Calculation
Agent shall have the right to adjust any variable relevant to the exercise,
settlement or payment for the Transaction as appropriate to reflect the costs
and expenses incurred due solely to hedging mismatches and market losses in
connection with commercially reasonable hedging activities, as a result of such
event or condition not having been publicly announced prior to the beginning of
such period; and

 

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(iii)   if any Potential Adjustment Event is declared and (a) the event or
condition giving rise to such Potential Adjustment Event is subsequently
amended, modified, cancelled or abandoned, (b) the “Conversion Rate” (as defined
in the Indenture) is otherwise not adjusted at the time or in the manner
contemplated by the relevant Dilution Adjustment Provision based on such
declaration or (c) the “Conversion Rate” (as defined in the Indenture) is
adjusted as a result of such Potential Adjustment Event and subsequently
re-adjusted (each of clauses (a), (b) and (c), a “Potential Adjustment Event
Change”) then, in each case, the Calculation Agent shall have the right to
adjust any variable relevant to the exercise, settlement or payment for the
Transaction as appropriate to reflect the costs and expenses incurred due solely
to hedging mismatches and market losses in connection with commercially
reasonable hedging activities, as a result of such Potential Adjustment Event
Change.

Dilution Adjustment Provisions:

  

Sections 5.05(A)(i), (ii), (iii), (iv), and (v) and Section 5.05(H) of the
Indenture.

Extraordinary Events applicable to the Transaction:

 

Merger Events:

  

Applicable; provided that notwithstanding Section 12.1(b) of the Equity
Definitions, a “Merger Event” means the occurrence of any event or condition set
forth in the definition of “Common Stock Change Event” in Section 5.09 of the
Indenture.

Tender Offers:

  

Applicable; provided that notwithstanding Section 12.1(d) of the Equity
Definitions, a “Tender Offer” means the occurrence of any event or condition set
forth in Section 5.05(A)(v) of the Indenture.

Consequences of Merger Events /

Tender Offers:

  

Notwithstanding Section 12.2 and Section 12.3 of the Equity Definitions (which
Section shall not apply for purposes of the Transaction), upon the occurrence of
a Merger Event or a Tender Offer, the Calculation Agent shall make a
corresponding adjustment in respect of any adjustment under the Indenture to any
one or more of the nature of the Shares (in the case of a Merger Event), Strike
Price, Number of Options, Option Entitlement and any other variable relevant to
the exercise, settlement or payment for the Transaction, subject to the second
paragraph under “Method of Adjustment”; provided, however, that such adjustment
shall be made without regard to any adjustment to the Conversion Rate pursuant
to any Excluded Provision; provided further that if with respect to any Merger
Event or any Tender Offer, (A) the consideration for the Shares includes (or, at
the option of a holder of Shares, may include) shares of an entity or person

 

11

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that is not a corporation or is not organized under the laws of the United
States, any State thereof or the District of Columbia or (B) the Counterparty to
the Transaction following such Merger Event or Tender Offer will not be a
corporation organized under the laws of the United States, any State thereof or
the District of Columbia, then, Cancellation and Payment (Calculation Agent
Determination) may apply at Dealer’s commercially reasonable election made in
good faith.

Nationalization, Insolvency or Delisting:

  

Cancellation and Payment (Calculation Agent Determination); provided that, 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 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 of the New York Stock Exchange, The
NASDAQ Global Select Market or The NASDAQ Global Market (or their respective
successors), such exchange or quotation system shall thereafter be deemed to be
the Exchange.

Additional Disruption Events:

  

        Change in Law:

  

Applicable; provided that Section 12.9(a)(ii) of the Equity Definitions is
hereby amended by (i) replacing the word “Shares” with the phrase “Hedge
Positions” in clause (X) thereof; (ii) inserting the parenthetical “(including,
for the avoidance of doubt and without limitation, adoption or promulgation of
new regulations authorized or mandated by existing statute)” at the end of
clause (A) thereof; (iii) replacing the phrase “the interpretation” in the third
line thereof with the phrase “or announcement of the formal or informal
interpretation”; and (iv) adding the words “provided that, in the case of clause
(Y) hereof where such determination is based on Dealer’s policies and
procedures, such policies and procedures have been adopted by Dealer in good
faith and are generally applicable in similar situations and applied in a
non-discriminatory manner” after the semicolon in the last line thereof.

        Failure to Deliver:

  

Applicable

        Hedging Disruption:

  

Applicable; provided that:

  

(i)  Section 12.9(a)(v) of the Equity Definitions is hereby amended by inserting
the following two phrases at the end of such Section:

  

“For the avoidance of doubt, the term “equity price risk” shall be deemed to
include, but shall not be limited to, stock price and volatility risk. And, for
the further avoidance of doubt, any such transactions or assets referred to in
phrases (A) or

 

12

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(B) above must be available on commercially reasonable pricing terms.”; and

  

(ii)   Section 12.9(b)(iii) of the Equity Definitions is hereby amended by
inserting in the third line thereof, after the words “to terminate the
Transaction”, the words “or a portion of the Transaction affected by such
Hedging Disruption”.

        Increased Cost of Hedging:

  

Applicable

        Hedging Party:

  

For all applicable Additional Disruption Events, Dealer. For the avoidance of
doubt, whenever the Hedging Party is called upon to make any adjustment or
calculation pursuant to the terms of this Confirmation to take into account the
effect of an Additional Disruption Event, the Hedging Party shall make such
adjustment or calculation in a commercially reasonable manner and assuming that
the Dealer maintains a commercially reasonable hedge position.

        Determining Party:

  

For all applicable Extraordinary Events, Dealer; provided that when making any
determination or calculation, Determining Party shall (i) be bound by the same
obligations relating to required acts of the Calculation Agent as set forth in
Section 1.40 of the Equity Definitions and this Confirmation as if Determining
Party were the Calculation Agent and (ii) make such determination or calculation
assuming that the Dealer maintains a commercially reasonable hedge position.
Following any determination or calculation by Determining Party hereunder, upon
a written request by Counterparty (which may be made by email), Determining
Party will promptly (but in any event within three Exchange Business Days)
provide to Counterparty by email to the email address provided by Counterparty
in such written request a report (in a commonly used file format for the storage
and manipulation of financial data) displaying in reasonable detail the basis
for such determination or calculation (including any assumptions, quotations,
market data or information from internal or external sources used in making such
determination or calculation but without disclosing Dealer’s proprietary or
confidential models or any other information that may be confidential,
proprietary or subject to contractual, legal or regulatory obligations or
restrictions to not disclose such information).

Non-Reliance:

  

Applicable

Agreements and Acknowledgments

Regarding Hedging Activities:

  

Applicable

Additional Acknowledgments:

  

Applicable

 

                4.           Calculation Agent.

Dealer, whose judgments, determinations and calculations shall be made in good
faith and in a commercially reasonable manner; provided that, following the

 

13

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occurrence and during the continuance of an Event of Default of the type
described in Section 5(a)(vii) of the Agreement with respect to which Dealer is
the Defaulting Party, Counterparty shall have the right to designate an
independent, nationally recognized equity derivatives dealer to replace Dealer
as Calculation Agent, whose fees and expenses, if any, shall be borne by Dealer,
and the parties shall work in good faith to execute any appropriate
documentation required by such replacement Calculation Agent. Following any
adjustment, determination or calculation by the Calculation Agent hereunder,
upon a request by Counterparty, the Calculation Agent shall promptly (but in any
event within three (3) Exchange Business Days) provide to Counterparty by e-mail
to the e-mail address provided by Counterparty in such request a report (in a
commonly used file format for the storage and manipulation of financial data)
displaying in reasonable detail the basis for such adjustment, determination or
calculation (including any assumptions, quotations, market data or information
from internal or external sources used in making such adjustment, determination
or calculation but without disclosing Dealer’s proprietary or confidential
models or other information that may be confidential, proprietary or subject to
contractual, legal or regulatory obligations or restrictions to not disclose
such information.

5.                 Account Details.

(a)          Account for payments to Counterparty:

To be provided.

Account for delivery of Shares to Counterparty:

To be provided.

(b)          Account for payments to Dealer:

[            ]

Account for delivery of Shares from Dealer:

[            ]

6.                 Offices.

 

  (a)

The Office of Counterparty for the Transaction is: Inapplicable, Counterparty is
not a Multibranch Party.

The Office of Dealer for the Transaction is: [            ]

7.                 Notices.

 

  (a)

Address for notices or communications to Counterparty:

DICK’S Sporting Goods, Inc.

345 Court Street

 

14

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Coraopolis, PA 15108

Attention:             [    ]

Telephone No.:    [    ]

Email:                  [    ]

 

  (b)

Address for notices or communications to Dealer:

[            ]

8.                 Representations and Warranties of Counterparty.

Each of the representations and warranties of Counterparty set forth in
Section 1 of the Purchase Agreement (the “Purchase Agreement”) dated as of
April 14, 2020, between Counterparty and [    ], [    ] and [    ], as Initial
Purchasers party thereto (the “Initial Purchasers”), are true and correct and
are hereby deemed to be repeated to Dealer as if set forth herein. Counterparty
hereby represents and warrants to Dealer on the date hereof and on and as of the
Premium Payment Date that:

 

  (a)

(i) Counterparty has all necessary corporate power and authority to execute,
deliver and perform its obligations in respect of the Transaction; (ii) such
execution, delivery and performance have been duly authorized by all necessary
corporate action on Counterparty’s part; (iii) and this Confirmation has been
duly and validly executed and delivered by Counterparty and constitutes its
valid and binding obligation, enforceable against Counterparty in accordance
with its terms, subject to applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and similar laws affecting creditors’
rights and remedies generally, and subject, as to enforceability, to general
principles of equity, including principles of commercial reasonableness, good
faith and fair dealing (regardless of whether enforcement is sought in a
proceeding at law or in equity) and except that rights to indemnification and
contribution hereunder may be limited by federal or state securities laws or
public policy relating thereto.

 

  (b)

In lieu of the representations set forth in Section 3(a)(iii) of the Agreement,
neither the execution and delivery of this Confirmation nor the incurrence or
performance of obligations of Counterparty hereunder will conflict with or
result in a breach of the certificate of incorporation or by-laws (or any
equivalent documents) of Counterparty, or any applicable law or regulation, or
any order, writ, injunction or decree of any court or governmental authority or
agency, or any agreement or instrument filed as an Exhibit to Counterparty’s
Annual Report on Form 10-K for the year ended December 31, 2019 (other than
agreements or instruments filed as exhibits pursuant to Item 601(b)(10)(iii) of
Regulation S-K under the Securities Act), as updated by any subsequent filings,
in each case to which Counterparty or any of its subsidiaries is a party or by
which Counterparty or any of its subsidiaries is bound, or constitute a default
under, or result in the creation of any lien under, any such agreement or
instrument.

 

  (c)

No consent, approval, authorization, or order of, or filing with, any
governmental agency or body or any court is required in connection with the
execution, delivery or performance by Counterparty of this Confirmation, except
such as have been obtained or made and such as may be required under the
Securities Act or state securities laws.

 

  (d)

Counterparty is not and, after consummation of the transactions contemplated
hereby, will not be required to register as an “investment company” as such term
is defined in the Investment Company Act of 1940, as amended.

 

  (e)

Counterparty is an “eligible contract participant” (as such term is defined in
Section 1a(18) of the Commodity Exchange Act, as amended, other than a person
that is an eligible contract participant under Section 1a(18)(C) of the
Commodity Exchange Act).

 

  (f)

Counterparty is not, on the date hereof, in possession of any material
non-public information with respect to Counterparty or the Shares.

 

15

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  (g)

Reserved.

 

  (h)

To Counterparty’s actual knowledge, no state or local (including any non-U.S.
jurisdiction’s) law, rule, regulation or regulatory order applicable to the
Shares would give rise to any reporting, consent, registration or other
requirement (including without limitation a requirement to obtain prior approval
from any person or entity) as a result of Dealer or its affiliates owning or
holding (however defined) Shares, in each case, other than U.S. federal
securities laws generally applicable to transactions relating to common equity
securities of U.S. domestic issuers listed on the Exchange; provided that
Counterparty makes no representation or warranty regarding any such requirement
that is applicable generally to the ownership of common equity securities of
U.S. domestic issuers listed on the Exchange by Dealer or any of its affiliates
solely as a result of it or any of such affiliates being a financial institution
or broker dealer.

 

  (i)

Counterparty (A) is capable of evaluating investment risks independently, both
in general and with regard to all transactions and investment strategies
involving a security or securities; (B) will exercise independent judgment in
evaluating the recommendations of any broker-dealer or its associated persons,
unless it has otherwise notified the broker-dealer in writing; and (C) has total
assets of at least USD 50 million.

 

  (j)

Counterparty is not as of the Trade Date, and Counterparty shall not be after
giving effect to the transactions contemplated hereby, “insolvent” (as such term
is defined in 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 Number of Shares in compliance with the
laws of the jurisdiction of Counterparty’s incorporation or organization
(including without limitation the adequate surplus requirements of Section 160
of the General Corporation Law of the State of Delaware).

 

  (k)

Prior to the Trade Date, Counterparty represents that Counterparty’s board of
directors has authorized the Transaction and approved the Transaction and any
related hedging activity for purposes of Section 203 of the Delaware General
Corporation Law and agrees to deliver to Dealer on or prior to the Trade Date a
copy of the resolutions of Counterparty’s board of directors covering the
foregoing authorization and approvals.

 

  (l)

On the Trade Date, neither Issuer nor any “affiliate” or “affiliated purchaser”
(each as defined in Rule 10b-18 under the Exchange Act (“Rule 10b-18”)) of
Issuer shall directly or indirectly (including, without limitation, by means of
any cash-settled or other derivative instrument) purchase, offer to purchase,
place any bid or limit order that would effect a purchase of, or commence any
tender offer relating to, any Shares (or an equivalent interest, including a
unit of beneficial interest in a trust or limited partnership or a depository
share) or any security convertible into or exchangeable or exercisable for
Shares.

9.                 Other Provisions.

 

  (a)

Opinions.    Counterparty shall deliver to Dealer an opinion of counsel, dated
as of the Premium Payment Date, with respect to the matters set forth in
Sections 8(a) through 8(d) of this Confirmation; provided that any such opinion
of counsel may contain customary limitations, exceptions and qualifications and
shall be limited to the federal laws of the United States, the laws of the State
of New York and the laws of the State of Delaware. Delivery of such opinion to
Dealer shall be a condition precedent for the purpose of Section 2(a)(iii) of
the Agreement with respect to each obligation of Dealer under Section 2(a)(i) of
the Agreement.

 

  (b)

Repurchase Notices.    Counterparty shall, on or prior to the date that is one
Scheduled Trading Day following any date on which Counterparty obtains actual
knowledge that it has effected any repurchase of Shares, promptly give Dealer a
written notice (which, for the avoidance of doubt may be by email) of such
repurchase (a “Repurchase Notice”) on such day if following such repurchase, the
number of outstanding Shares as determined on such day is (i) less than
57.2 million (in the case of the first such notice) or (ii) thereafter more than
1.9 million less than the number of Shares

 

16

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included in the immediately preceding Repurchase Notice; provided that, with
respect to any repurchase of Shares pursuant to a plan under Rule 10b5-1 under
the Exchange Act, Counterparty may elect to satisfy such requirement by promptly
giving Dealer written notice of entry into such plan, the maximum number of
Shares that may be purchased thereunder and the approximate dates or periods
during which such repurchases may occur (with such maximum deemed repurchased on
the date of such notice for purposes of this Section 9(b)). Counterparty agrees
to indemnify and hold harmless Dealer and its affiliates and their respective
officers, directors, employees, affiliates, advisors, agents and controlling
persons (each, an “Indemnified Person”) from and against any and all losses
(including losses relating to Dealer’s hedging activities as a consequence of
becoming, or of the risk of becoming, a Section 16 “insider”, including without
limitation, any forbearance from hedging activities or cessation of hedging
activities and any losses in connection therewith with respect to the
Transaction), claims, damages, judgments, liabilities and reasonable and
documented out-of-pocket expenses (including reasonable attorney’s fees of one
outside counsel in each relevant jurisdiction), joint or several, which an
Indemnified Person may become subject to, in each case, as a result of
Counterparty’s failure to provide Dealer with a Repurchase Notice on the day and
in the manner specified in this paragraph, and to reimburse, within 30 days,
upon written request, each of such Indemnified Persons for any reasonable legal
or other out-of-pocket expenses incurred (and supported by invoices or other
documentation setting forth in reasonable detail such expenses) in connection
with investigating, preparing for, providing testimony or other evidence in
connection with or defending any of the foregoing. If any suit, action,
proceeding (including any governmental or regulatory investigation), claim or
demand shall be brought or asserted against the Indemnified Person as a result
of Counterparty’s failure to provide Dealer with a Repurchase Notice in
accordance with this paragraph, such Indemnified Person shall promptly notify
Counterparty in writing, and Counterparty, upon request of the Indemnified
Person, shall retain counsel reasonably satisfactory to the Indemnified Person
to represent the Indemnified Person and any others Counterparty may designate in
such proceeding and shall pay the reasonable fees and expenses of such counsel
related to such proceeding. Counterparty shall not be liable to the extent that
the Indemnified Person fails to notify Counterparty within a commercially
reasonable period of time after any action is commenced against it in respect of
which indemnity may be sought hereunder (it being understood that any such
notice delivered within 30 calendar days of the commencement of any such action
shall be deemed to have been delivered within a commercially reasonable period
of time for such purpose). Counterparty shall not be liable for any settlement
of any such proceeding contemplated by this paragraph that is effected without
its written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, Counterparty agrees to indemnify any Indemnified
Person from and against any loss or liability by reason of such settlement or
judgment. Counterparty shall not, without the prior written consent of the
Indemnified Person, effect any settlement of any such proceeding that is pending
or threatened in respect of which any Indemnified Person is or could have been a
party and indemnity could have been sought hereunder by such Indemnified Person,
unless such settlement includes an unconditional release of such Indemnified
Person from all liability on claims that are the subject matter of such
proceeding on terms reasonably satisfactory to such Indemnified Person.
Counterparty shall not be liable for any losses, claims, damages or liabilities
(or expenses relating thereto) of any Indemnified Person that results from the
bad faith, gross negligence, willful misconduct or fraud of an Indemnified
Person (in each case, as conclusively determined by a court of competent
jurisdiction in a final and non-appealable judgment). If the indemnification
provided for in this paragraph is unavailable to an Indemnified Person or
insufficient in respect of any losses, claims, damages or liabilities referred
to therein, then Counterparty hereunder, in lieu of indemnifying such
Indemnified Person thereunder, shall contribute to the amount paid or payable by
such Indemnified Person as a result of such losses, claims, damages or
liabilities. The remedies provided for in this paragraph (b) are not exclusive
and shall not limit any rights or remedies which may otherwise be available to
any Indemnified Person at law or in equity. The indemnity and contribution
agreements contained in this paragraph shall remain operative and in full force
and effect regardless of the termination of the Transaction.

 

  (c)

Regulation M.    Counterparty is not on the Trade Date engaged in a
distribution, as such term is used in Regulation M under the Exchange Act, of
any securities of Counterparty, other than a distribution meeting the
requirements of the exception set forth in Rules 101(b)(10) and 102(b)(7) of
Regulation

 

17

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M. Counterparty shall not, until the second Scheduled Trading Day immediately
following the Effective Date, engage in any such distribution.

 

  (d)

No Manipulation.    Counterparty is not entering into the Transaction to create
actual or apparent trading activity in the Shares (or any security convertible
into or exchangeable for the Shares) or to raise or depress or otherwise
manipulate the price of the Shares (or any security convertible into or
exchangeable for the Shares) or otherwise in violation of the Exchange Act.

 

  (e)

Transfer or Assignment.

 

  (i)

Counterparty shall have the right to transfer and assign its rights and
obligations hereunder with respect to all, but not less than all, of the Options
hereunder (such Options, the “Transfer Options”); provided that such transfer or
assignment shall be subject to the following conditions:

 

  (A)

With respect to any Transfer Options, Counterparty shall not be released from
its notice and indemnification obligations pursuant to Section 9(b) or any
obligations under Section 9(o) or 9(u) of this Confirmation;

 

  (B)

Any Transfer Options shall only be transferred or assigned to a third party that
is a United States person (as defined in the Internal Revenue Code of 1986, as
amended (the “Code”));

 

  (C)

Such transfer or assignment shall be effected on terms, including any reasonable
undertakings by such third party (including, but not limited to, an undertaking
with respect to compliance with applicable securities laws in a manner that, in
the reasonable judgment of Dealer, will not expose Dealer to material risks
under applicable securities laws) and execution of any documentation and
delivery of legal opinions with respect to securities laws and other matters by
such third party and Counterparty, as are reasonably requested and reasonably
satisfactory to Dealer;

 

  (D)

Under the applicable law effective on the date of such transfer or assignment,
(x) Dealer will not, as a result of such transfer and assignment, be required to
pay the transferee or assignee on any payment date an amount under
Section 2(d)(i)(4) of the Agreement greater than an amount that Dealer would
have been required to pay to Counterparty in the absence of such transfer and
assignment and (y) Dealer will not, as a result of such transfer or assignment,
receive from the transferee or assignee on any payment date an amount (taking
into account any additional amounts paid under Section 2(d)(i)(4) of the
Agreement) that is less than the amount the Dealer would have received from
Counterparty in the absence of such transfer or assignment;

 

  (E)

An Event of Default, Potential Event of Default or Termination Event will not
occur as a result of such transfer and assignment;

 

  (F)

Without limiting the generality of clause (B), Counterparty shall cause the
transferee to make such Payee Tax Representations and to provide such tax
documentation as may be reasonably requested by Dealer to permit Dealer to
determine that results described in clauses (D) and (E) will not occur upon or
after such transfer and assignment; and

 

  (G)

Counterparty shall be responsible for all reasonable costs and expenses,
including reasonable counsel fees, incurred by Dealer in connection with such
transfer or assignment.

 

  (ii)

Dealer may transfer or assign all or any part of its rights or obligations under
the Transaction (A) without Counterparty’s consent, to any affiliate or branch
of Dealer (1)

 

18

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that has a long-term issuer rating that is equal to or better than Dealer’s
credit rating at the time of such transfer or assignment, or (2) whose
obligations hereunder will be guaranteed, pursuant to the terms of a customary
guarantee in a form used by Dealer generally for similar transactions, by Dealer
or [Dealer Parent][Dealer’s ultimate parent] or (B) with Counterparty’s consent
(such consent not to be unreasonably withheld) to any third party with a
long-term issuer rating equal to or better than the lesser of (1) the credit
rating of Dealer at the time of the transfer and (2) A- by S&P Global Ratings or
its successor (“S&P”), and A3 by Moody’s Investor Service, Inc. (“Moody’s”) or,
if either S&P or Moody’s ceases to rate such debt, at least an equivalent rating
or better by a substitute rating agency mutually agreed by Counterparty and
Dealer; provided that in the case of any transfer or assignment described in
clause (A) or (B) above, no Event of Default, Potential Event of Default or
Termination Event with respect to which Dealer is the Defaulting Party or an
Affected Party, as the case may be, exists or will occur as a result of such
transfer or assignment; provided, further, that under the applicable law
effective on the date of such transfer or assignment, (1) at the time of such
assignment or transfer Counterparty will not, as a result of such transfer or
assignment, either (I) be required to pay (including a payment in kind) the
transferee or assignee on any payment or settlement date an amount under
Section 2(d)(i)(4) of the Agreement greater than the amount that Counterparty
would have been required to pay to Dealer in the absence of such transfer or
assignment, or (II) receive (including a payment in kind) from the transferee or
assignee on any payment or settlement date an amount under Section 2(d)(i)(4) of
the Agreement that is less than the amount that Counterparty would have received
from Dealer in the absence of such transfer or assignment; and (2) such transfer
or assignment does not cause a deemed exchange for Counterparty of the
Transaction under Section 1001 of the Code. Dealer shall cause the transferee or
assignee to make such Payee Tax Representations and to provide such tax
documentation as may be reasonably requested by Counterparty to permit
Counterparty to determine that the events described in the preceding proviso
shall not occur upon or after such transfer or assignment. If at any time at
which (A) the Section 16 Percentage exceeds 8.0%, (B) the Option Equity
Percentage exceeds 14.5% or (C) the Share Amount exceeds the Applicable Share
Limit (if any applies) (any such condition described in clauses (A), (B) or (C),
an “Excess Ownership Position”), Dealer is unable after using its commercially
reasonable efforts to effect a transfer or assignment of Options to a third
party in accordance with the terms hereof and on pricing terms reasonably
acceptable to Dealer and within a time period reasonably acceptable to Dealer
such that no Excess Ownership Position exists, then Dealer may designate any
Exchange Business Day as an Early Termination Date with respect to a portion of
the Transaction (the “Terminated Portion”), such that following such partial
termination no Excess Ownership Position exists. In the event that Dealer so
designates an Early Termination Date with respect to a portion of the
Transaction, a payment shall be made pursuant to Section 6 of the Agreement as
if (1) an Early Termination Date had been designated in respect of a Transaction
having terms identical to the Transaction and a Number of Options equal to the
number of Options underlying the Terminated Portion, (2) Counterparty were the
sole Affected Party with respect to such partial termination and (3) the
Terminated Portion were the sole Affected Transaction (and, for the avoidance of
doubt, the provisions of Section 9(m) shall apply to any amount that is payable
by Dealer to Counterparty pursuant to this sentence as if Counterparty was not
the Affected Party). The “Section 16 Percentage” as of any day is the fraction,
expressed as a percentage, (A) the numerator of which is the number of Shares
that Dealer and any of its affiliates or any other person subject to aggregation
with Dealer for purposes of the “beneficial ownership” test under Section 13 of
the Exchange Act, or any “group” (within the meaning of Section 13 of the
Exchange Act) of which Dealer is or may be deemed to be a part beneficially owns
(within the meaning of Section 13 of the Exchange Act), without duplication, on
such day (or, to the extent that for any reason the equivalent calculation under
Section 16 of the Exchange Act and the rules and regulations thereunder results
in a higher number, such higher number) and (B) the denominator of which is the
number of Shares outstanding on such day. The “Option Equity Percentage” as of
any day is the fraction, expressed as a percentage, (A) the numerator of which
is the

 

19

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sum of (1) the product of the Number of Options and the Option Entitlement and
(2) the aggregate number of Shares underlying any other call option transaction
sold by Dealer to Counterparty, and (B) the denominator of which is the number
of Shares outstanding. The “Share Amount” as of any day is the number of Shares
that Dealer and any person whose ownership position would be aggregated with
that of Dealer (Dealer or any such person, a “Dealer Person”) under Section 203
of the Delaware General Corporation Law or any other law, rule, regulation,
regulatory order or organizational documents or contracts of Counterparty that
are, in each case, applicable to ownership of Shares (“Applicable
Restrictions”), owns, beneficially owns, constructively owns, controls, holds
the power to vote or otherwise meets a relevant definition of ownership under
any Applicable Restriction, as determined by Dealer in its good faith,
reasonable discretion. The “Applicable Share Limit” means a number of Shares
equal to (A) the minimum number of Shares that could give rise to reporting or
registration obligations (except for any filing requirements on Form 13F,
Schedule 13D or Schedule 13G under the Exchange Act, in each case, as in effect
on the Trade Date) or other requirements (including obtaining prior approval
from any person or entity) of a Dealer Person, or could result in an adverse
effect on a Dealer Person, under any Applicable Restriction, as determined by
Dealer in good faith and in its reasonable discretion, minus (B) 1.0% of the
number of Shares outstanding.

 

  (iii)

Notwithstanding any other provision in this Confirmation to the contrary
requiring or allowing Dealer to purchase, sell, receive or deliver any Shares or
other securities, or make or receive any payment in cash, to or from
Counterparty, Dealer may designate any of its affiliates to purchase, sell,
receive or deliver such Shares or other securities, or to make or receive such
payment in cash, and otherwise to perform Dealer’s obligations in respect of the
Transaction and any such designee may assume such obligations. Dealer shall be
discharged of its obligations to Counterparty solely to the extent of any such
performance.

 

  (f)

Staggered Settlement.    If upon advice of counsel with respect to applicable
legal and regulatory requirements, including any requirements relating to
Dealer’s commercially reasonable hedging activities hereunder, Dealer reasonably
determines that it would not be practicable or advisable to deliver, or to
acquire Shares to deliver, any or all of the Shares to be delivered by Dealer on
any Settlement Date for the Transaction, Dealer may, by notice to Counterparty
on or prior to any Settlement Date (a “Nominal Settlement Date”), elect to
deliver the Shares on two or more dates (each, a “Staggered Settlement Date”) as
follows:

 

  (i)

in such notice, Dealer will specify to Counterparty the related Staggered
Settlement Dates (each of which will be on or prior to such Nominal Settlement
Date) and the number of Shares that it will deliver on each Staggered Settlement
Date;

 

  (ii)

the aggregate number of Shares that Dealer will deliver to Counterparty
hereunder on all such Staggered Settlement Dates will equal the number of Shares
that Dealer would otherwise be required to deliver on such Nominal Settlement
Date; and

 

  (iii)

if the Net Share Settlement terms or the Combination Settlement terms set forth
above were to apply on the Nominal Settlement Date, then the Net Share
Settlement terms or the Combination Settlement terms, as the case may be, will
apply on each Staggered Settlement Date, except that the Shares otherwise
deliverable on such Nominal Settlement Date will be allocated among such
Staggered Settlement Dates as specified by Dealer in the notice referred to in
clause (i) above.

 

  (g)

Reserved.

 

  (h)

Reserved.

 

  (i)

Reserved.

 

  (j)

Additional Termination Events.

 

20

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  (i)

Notwithstanding anything to the contrary in this Confirmation if an event of
default with respect to Counterparty occurs under the terms of the Convertible
Notes as set forth in Section 7.01 of the Indenture that results in the
Convertible Notes becoming or being declared due and payable pursuant to the
terms of the Indenture, then such event of default shall constitute an
Additional Termination Event applicable to the Transaction and, with respect to
such Additional Termination Event, (A) Counterparty shall be deemed to be the
sole Affected Party, (B) the Transaction shall be the sole Affected Transaction
and (C) Dealer shall be the party entitled to designate an Early Termination
Date pursuant to Section 6(b) of the Agreement.

 

  (ii)

Promptly, but in any event within five Scheduled Trading Days, following any
Repayment Event (as defined below), Counterparty may notify Dealer of such
Repayment Event and the aggregate principal amount of Convertible Notes subject
to such Repayment Event (any such notice, a “Repayment Notice”); provided that
such Repayment Notice shall contain the representation and warranty that
Counterparty is not, on the date thereof, aware of any material non-public
information with respect to Counterparty or the Shares; provided, further, that
any “Repayment Notice” delivered to Dealer pursuant to the Base Call Option
Confirmation shall be deemed to be a Repayment Notice pursuant to this
Confirmation and the terms of such Repayment Notice shall apply, mutatis
mutandis, to this Confirmation.]. The receipt by Dealer from Counterparty of any
Repayment Notice shall constitute an Additional Termination Event as provided in
this Section 9(j)(ii). Upon receipt of any such Repayment Notice, Dealer shall
designate an Exchange Business Day following receipt of such Repayment Notice as
an Early Termination Date with respect to the portion of the Transaction
corresponding to a number of Options (the “Repayment Options”) equal to the
lesser of (A) [x] the aggregate principal amount of such Convertible Notes
specified in such Repayment Notice, divided by USD 1,000, [minus (y) the number
of “Repayment Options” (as defined in the Base Call Option Confirmation), if
any, that relate to such Convertible Notes (and for the purposes of determining
whether any Options under this Confirmation or under the Base Call Option
Confirmation will be among the Repayment Options hereunder or under, and as
defined in the Base Call Option Confirmation, the Convertible Notes specified in
such Repayment Notice shall be allocated first to the Base Call Option
Confirmation until all Options thereunder are exercised or terminated),] and
(B) the Number of Options as of the date Dealer designates such Early
Termination Date and, as of such date, the Number of Options shall be reduced by
the number of Repayment Options. Any payment hereunder with respect to such
termination (the “Repayment Unwind Payment”) shall be calculated pursuant to
Section 6 of the Agreement as if (1) an Early Termination Date had been
designated in respect of a Transaction having terms identical to the Transaction
and a Number of Options equal to the number of Repayment Options,
(2) Counterparty were the sole Affected Party with respect to such Additional
Termination Event, and (3) the terminated portion of the Transaction were the
sole Affected Transaction; provided that, in the event of a Repayment Event
pursuant to Section 4.02 of the Indenture or Section 4.03 of the Indenture, the
Repayment Unwind Payment shall not be greater than (x) the number of Repayment
Options multiplied by (y) the product of (A) the Applicable Percentage and
(B) the excess of (I) the amount paid by Counterparty per Convertible Note
pursuant to Section 4.02 of the Indenture or Section 4.03 of the Indenture, as
the case may be, over (II) USD 1,000 per Convertible Note. “Repayment Event”
means that (i) any Convertible Notes are repurchased (whether pursuant to
Section 4.02 of the Indenture, pursuant to Section 4.03 of the Indenture or for
any other reason) by Counterparty or any of its subsidiaries, (ii) any
Convertible Notes are delivered to Counterparty or any of its subsidiaries in
exchange for delivery of any property or assets of such party (howsoever
described), (iii) any principal of any of the Convertible Notes is repaid prior
to the final maturity date of the Convertible Notes (for any reason other than
as a result of an acceleration of the Convertible Notes that results in an
Additional Termination Event pursuant to the preceding Section 9(j)(i)), or
(iv) any Convertible Notes are exchanged by or for the benefit of the Holders
(as such term is defined in the Indenture) thereof for any other securities of
Counterparty or any of its subsidiaries (or any other

 

21

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property, or any combination thereof) pursuant to any exchange offer or similar
transaction. For the avoidance of doubt, any conversion of Convertible Notes
pursuant to the terms of the Indenture shall not constitute a Repayment Event.

 

  (iii)

Notwithstanding anything to the contrary in this Confirmation, the occurrence of
an Amendment Event shall constitute an Additional Termination Event applicable
to the Transaction and, with respect to such Additional Termination Event,
(A) Counterparty shall be deemed to be the sole Affected Party, (B) the
Transaction shall be the sole Affected Transaction and (C) Dealer shall be the
party entitled to designate an Early Termination Date pursuant to Section 6(b)
of the Agreement. “Amendment Event” means that Counterparty amends, modifies,
supplements, waives or obtains a waiver in respect of any term of the Indenture
or the Convertible Notes that would require consent of the holders of not less
than 100% of the principal amount of the Convertible Notes to amend, in each
case, without the consent of Dealer.

 

  (iv)

Notwithstanding anything to the contrary in this Confirmation, upon any Early
Conversion in respect of which a Notice of Conversion (as such term is defined
in the Indenture) that is effective as to Counterparty has been delivered by the
relevant converting Holder (as such term is defined in the Indenture):

 

  (A)

Promptly, but in any event within five Scheduled Trading Days, following the
Conversion Date for such Early Conversion, Counterparty shall provide written
notice (an “Early Conversion Notice”) to Dealer specifying the number of
Convertible Notes surrendered for conversion on such Conversion Date (such
Convertible Notes, the “Affected Convertible Notes”), and the giving of such
Early Conversion Notice shall constitute an Additional Termination Event as
provided in this clause (iv);

 

  (B)

upon receipt of any such Early Conversion Notice, Dealer shall designate an
Exchange Business Day as an Early Termination Date (which Exchange Business Day
shall be no earlier than one Scheduled Trading Day following the Conversion Date
for such Early Conversion) with respect to the portion of the Transaction
corresponding to a number of Options (the “Affected Number of Options”) equal to
the lesser of (x) the number of Affected Convertible Notes [, minus the
“Affected Number of Options” (as defined in the Base Call Option Confirmation),
if any, that relate to such Affected Convertible Notes] and (y) the Number of
Options as of the Conversion Date for such Early Conversion; provided that
settlement with respect to any such Early Termination Date shall occur on or as
promptly as commercially reasonably practicable after the date of payment of the
amount of cash (if any) and/or delivery of the number of Shares (if any) upon
settlement of the conversion of the relevant Affected Convertible Notes;

 

  (C)

any payment hereunder with respect to such termination shall be calculated
pursuant to Section 6 of the Agreement as if (x) an Early Termination Date had
been designated in respect of a Transaction having terms identical to the
Transaction and a Number of Options equal to the Affected Number of Options,
(y) Counterparty were the sole Affected Party with respect to such Additional
Termination Event and (z) the terminated portion of the Transaction were the
sole Affected Transaction; provided that the amount payable with respect to such
termination shall not be greater than (1) the Applicable Percentage, multiplied
by (2) the Affected Number of Options, multiplied by (3) (x) the sum of (i) the
amount of cash paid (if any) to the Holder (as such term is defined in the
Indenture) of an Affected Convertible Note upon conversion of such Affected
Convertible Note and (ii) the number of Shares delivered (if any) to the Holder
(as such term is defined in the Indenture) of an Affected Convertible Note upon
conversion of such Affected Convertible Note multiplied by the Applicable Limit
Price, minus (y) USD 1,000;

 

22

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  (D)

for the avoidance of doubt, in determining the amount payable in respect of such
Affected Transaction pursuant to Section 6 of the Agreement, the Calculation
Agent shall assume that (x) the relevant Early Conversion and any conversions,
adjustments, agreements, payments, deliveries or acquisitions by or on behalf of
Counterparty leading thereto had not occurred, (y) no adjustments to the
Conversion Rate (as such term is defined in the Indenture) have occurred
pursuant to any Excluded Provision and (z) the corresponding Convertible Notes
remain outstanding; and

 

  (E)

the Transaction shall remain in full force and effect, except that, as of the
Conversion Date for such Early Conversion, the Number of Options shall be
reduced by the Affected Number of Options.

 

  (k)

Amendments to Equity Definitions.

 

  (i)

Section 12.6(a)(ii) of the Equity Definitions is hereby amended by deleting from
the fourth line thereof the word “or” after the word “official” and inserting a
comma therefor.

 

  (ii)

Section 12.9(b)(i) of the Equity Definitions is hereby amended by (1) replacing
“either party may elect” with “Dealer may elect” and (2) replacing “notice to
the other party” with “notice to Counterparty” in the first sentence of such
section.

 

  (l)

No Collateral or Set-off. Notwithstanding any provision of the Agreement or any
other agreement between the parties to the contrary, the obligations of
Counterparty hereunder are not secured by any collateral. Each party waives any
and all rights it may have to set off obligations arising under the Agreement
and the Transaction against other obligations between the parties, whether
arising under any other agreement, applicable law or otherwise.

 

  (m)

Alternative Calculations and Payment on Early Termination and on Certain
Extraordinary Events. If (a) an Early Termination Date (whether as a result of
an Event of Default or a Termination Event) occurs or is designated with respect
to the Transaction or (b) the Transaction is cancelled or terminated upon the
occurrence of an Extraordinary Event (except as a result of (i) a
Nationalization, Insolvency or Merger Event in which the consideration to be
paid to holders of Shares consists solely of cash, (ii) a Merger Event or Tender
Offer that is, in each case, within Counterparty’s control, or (iii) an Event of
Default in which Counterparty is the Defaulting Party or a Termination Event in
which Counterparty is the Affected Party other than an Event of Default of the
type described in Section 5(a)(iii), (v), (vi), (vii) or (viii) of the Agreement
or a Termination Event of the type described in Section 5(b) of the Agreement,
in each case that resulted from an event or events outside Counterparty’s
control), and if Dealer would owe any amount to Counterparty pursuant to
Section 6(d)(ii) of the Agreement or any Cancellation Amount pursuant to Article
12 of the Equity Definitions (any such amount, a “Payment Obligation”), then
Dealer shall satisfy the Payment Obligation by the Share Termination Alternative
(as defined below), unless (a) Counterparty gives irrevocable telephonic notice
to Dealer, confirmed in writing within one Scheduled Trading Day, no later than
12:00 p.m. (New York City time) on the Merger Date, Tender Offer Date,
Announcement Date (in the case of a Nationalization, Insolvency or Delisting),
Early Termination Date or date of cancellation, as applicable, of its election
that the Share Termination Alternative shall not apply, (b) Counterparty remakes
the representation set forth in Section 8(f) as of the date of such election and
(c) Dealer agrees, in its sole discretion made in good faith, to such election,
in which case the provisions of Section 12.7 or Section 12.9 of the Equity
Definitions, or the provisions of Section 6(d)(ii) and Section 6(e) of the
Agreement, as the case may be, shall apply.

 

                                  

 

Share Termination Alternative:

  

If applicable, Dealer shall deliver to Counterparty the Share Termination
Delivery Property on, or within a commercially reasonable period of time after,
the date when the relevant Payment Obligation would otherwise be due pursuant to
Section 12.7 or 12.9 of the Equity Definitions or Section 6(d)(ii) and 6(e) of

 

23

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the Agreement, as applicable, in satisfaction of such Payment Obligation in the
manner reasonably requested by Counterparty free of payment.

 

Share Termination Delivery Property:

  

A number of Share Termination Delivery Units, as calculated by the Calculation
Agent, equal to the Payment Obligation divided by the Share Termination Unit
Price. The Calculation Agent shall adjust the Share Termination Delivery
Property by replacing any fractional portion of a security therein with an
amount of cash equal to the value of such fractional security based on the
values used to calculate the Share Termination Unit Price.

 

Share Termination Unit Price:

  

The value of property contained in one Share Termination Delivery Unit, as
determined by the Calculation Agent in its discretion by commercially reasonable
means and notified by the Calculation Agent to Dealer at the time of
notification of the Payment Obligation. For the avoidance of doubt, the parties
agree that in determining the Share Termination Delivery Unit Price the
Calculation Agent may consider the purchase price paid in connection with the
purchase of Share Termination Delivery Property.

 

Share Termination Delivery Unit:

  

One Share or, if the Shares have changed into cash or any other property or the
right to receive cash or any other property as the result of a Nationalization,
Insolvency or Merger Event (any such cash or other property, the “Exchange
Property”), a unit consisting of the type and amount of such Exchange Property
received by a holder of one Share (without consideration of any requirement to
pay cash or other consideration in lieu of fractional amounts of any securities)
in such Nationalization, Insolvency or Merger Event, as determined by the
Calculation Agent. If such Nationalization, Insolvency, or Merger Event involves
a choice of Exchange Property to be received by holders, such holder shall be
deemed to have elected to receive the maximum possible amount of cash.

 

Failure to Deliver:

  

Applicable

 

Other applicable provisions:

  

If Share Termination Alternative is applicable, the provisions of Sections 9.8,
9.9 and 9.11 (as modified above) of the Equity Definitions and the provisions
set forth opposite the caption “Representation and Agreement” in Section 2 will
be applicable, except that all references in such provisions to
“Physically-settled” shall be read as references to “Share Termination Settled”
and all references to “Shares” shall be read as references to “Share Termination
Delivery Units”. “Share Termination Settled” in relation to the Transaction
means that the Share

 

24

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Termination Alternative is applicable to the Transaction.

 

  (n)

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 the 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
the Transaction, as applicable, by, among other things, the mutual waivers and
certifications provided herein.

 

  (o)

Registration. Counterparty hereby agrees that if, in the good faith reasonable
judgment of Dealer, based on advice of counsel, the Shares (“Hedge Shares”)
acquired by Dealer for the purpose of effecting a commercially reasonable hedge
of its obligations pursuant to the Transaction cannot be sold in the public
market by Dealer without registration under the Securities Act, Counterparty
shall, at its election, either (i) in order to allow Dealer to sell the Hedge
Shares in a registered offering, make available to Dealer an effective
registration statement under the Securities Act for so long as Hedge Shares
cannot be sold by Dealer in the public market without registration (as
determined by Dealer in its good faith reasonable judgment based on advice of
counsel) and enter into an agreement, in form and substance reasonably
satisfactory to Dealer, substantially in the form of an underwriting agreement
customary for a registered secondary offering of a similar size and industry;
provided, however, that if Dealer, in its sole discretion and in good faith, 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 paragraph
shall apply at the election of Counterparty, (ii) in order to allow Dealer to
sell the Hedge Shares in a private placement, use commercially reasonable best
efforts to enter into a private placement agreement substantially similar to
private placement purchase agreements customary for private placements of equity
securities of a similar size and industry, in form and substance reasonably
satisfactory to Dealer (in which case, the Calculation Agent shall make any
adjustments to the terms of the Transaction that are necessary, in its
commercially reasonable judgment made in good faith, to compensate Dealer for
any commercially reasonable discount from the public market price of the Shares
incurred on the sale of Hedge Shares in a private placement of similar size), or
(iii) purchase the Hedge Shares from Dealer at the then-current market price on
such Exchange Business Days, and in the amounts and at such time(s), reasonably
requested by Dealer.

 

  (p)

Tax Disclosure. 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.

 

  (q)

Right to Extend. The Calculation Agent may postpone or add, in whole or in part,
any Valid Day or Valid Days during the Settlement Averaging Period or any other
date of valuation, payment or delivery by Dealer, with respect to some or all of
the Options hereunder, if Dealer reasonably determines, and in the case of
clause (ii) below, based on advice of counsel, that such action is reasonably
necessary or appropriate (i) to preserve Dealer’s commercially reasonable
hedging or hedge unwind activity hereunder in light of existing liquidity
conditions in the stock loan market or other relevant market or (ii) to enable
Dealer to effect transactions with respect to Shares in connection with its
commercially reasonable 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; provided that such policies and procedures have been adopted by
Dealer in good faith and are generally applicable in similar situations and
applied in a non-discriminatory manner; provided further that no such Valid Day
or other date of valuation, payment or delivery may be postponed or added more
than 60 Valid Days after the original Valid Day or other date of valuation,
payment or delivery, as the case may be.

 

25

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  (r)

Reserved.

 

  (s)

Status of Claims in Bankruptcy. Dealer acknowledges and agrees that this
Confirmation is not intended to convey to Dealer rights against Counterparty
with respect to the Transaction that are senior to the claims of common
stockholders of Counterparty in any United States bankruptcy proceedings of
Counterparty; provided that nothing herein shall limit or shall be deemed to
limit Dealer’s right to pursue remedies in the event of a breach by Counterparty
of its obligations and agreements with respect to the Transaction; provided,
further, that nothing herein shall limit or shall be deemed to limit Dealer’s
rights in respect of any transactions other than the Transaction.

 

  (t)

Securities Contract; Swap Agreement. The parties hereto intend for (i) the
Transaction to be a “securities contract” and a “swap agreement” as defined in
the Bankruptcy Code (Title 11 of the United States Code) (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), 546(e), 546(g), 555 and
560 of the Bankruptcy Code, (ii) a party’s right to liquidate the 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 described in the Bankruptcy Code, and (iii) each payment and delivery
of cash, securities or other property hereunder to constitute a “margin payment”
or “settlement payment” and a “transfer” as defined in the Bankruptcy Code.

 

  (u)

Notice of Certain Other Events. Counterparty covenants and agrees that:

 

  (i)

promptly following the public announcement of the results of any election by the
holders of Shares with respect to the consideration due upon consummation of any
Merger Event, Counterparty shall give Dealer written notice of (x) the weighted
average of the types and amounts of consideration that holders of Shares have
elected to receive upon consummation of such Merger Event or (y) if no holders
of Shares affirmatively make such election, the types and amounts of
consideration actually received by holders of Shares (the date of such
notification, the “Consideration Notification Date”); provided that in no event
shall the Consideration Notification Date be later than the date on which such
Merger Event is consummated; and

 

  (ii)

(A) Counterparty shall give Dealer commercially reasonable advance (but in any
event at least one Exchange Business Day prior to the relevant Adjustment Notice
Deadline) written notice of the section or sections of the Indenture and, if
applicable, the formula therein, pursuant to which any adjustment will be made
to the Convertible Notes in connection with any Potential Adjustment Event
(other than a Potential Adjustment Event in respect of the Dilution Adjustment
Provision set forth in 5.05(A)(ii) or 5.05(A)(iv) of the Indenture) or Merger
Event and (B) promptly following any such adjustment, Counterparty shall give
Dealer written notice of the details of such adjustment. The “Adjustment Notice
Deadline” means (i) for any Potential Adjustment Event in respect of the
Dilution Adjustment Provision set forth in Section 5.05(A)(i) of the Indenture,
the relevant “Ex-Dividend Date” (as such term is defined in the Indenture) or
“effective date” (as such term is used in Section 5.05(A)(i) of the Indenture),
as the case may be, (ii) for any Potential Adjustment Event in respect of the
Dilution Adjustment Provision set forth in Section 5.05(A)(iii)(1) of the
Indenture, the first “Trading Day” (as such term is defined in the Indenture) of
the period referred to in the definition of “SP” in such formula, (iii) for any
Potential Adjustment Event in respect of the Dilution Adjustment Provision set
forth in Section 5.05(A)(iii)(2) of the Indenture, the first “Trading Day” (as
such term is defined in the Indenture) of the “Spin-Off Valuation Period” (as
such term is defined in the Indenture), (iv) for any Potential Adjustment Event
in respect of the Dilution Adjustment Provision set forth in Section 5.05(A)(v)
of the Indenture, the first “Trading Day” (as such term is defined in the
Indenture) of the “Tender/Exchange Offer Valuation Period” (as such term is
defined in the Indenture), and (v) for any Merger Event, the effective date of
such Merger Event (or, if earlier, the first day of any valuation or similar
period in respect of such Merger Event).

 

26

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  (v)

Wall Street Transparency and Accountability Act. In connection with Section 739
of the Wall Street Transparency and Accountability Act of 2010 (“WSTAA”), the
parties hereby agree that neither the enactment of WSTAA or any regulation under
the WSTAA, nor any requirement under WSTAA or an amendment made by WSTAA, shall
limit or otherwise impair either party’s otherwise applicable rights to
terminate, renegotiate, modify, amend or supplement this Confirmation or the
Agreement, as applicable, arising from a termination event, force majeure,
illegality, increased costs, regulatory change or similar event under this
Confirmation, the Equity Definitions incorporated herein, or the Agreement
(including, but not limited to, rights arising from Change in Law, Hedging
Disruption, an Excess Ownership Position, or Illegality (as defined in the
Agreement)).

 

  (w)

Agreements and Acknowledgements Regarding Hedging. Counterparty understands,
acknowledges and agrees that: (A) at any time on and prior to the Expiration
Date, Dealer and its affiliates may buy or sell Shares or other securities or
buy or sell options or futures contracts or enter into swaps or other derivative
securities in order to adjust its hedge position with respect to the
Transaction; (B) Dealer and its affiliates also may be active in the market for
Shares other than in connection with hedging activities in relation to the
Transaction; (C) Dealer shall make its own determination as to whether, when or
in what manner any hedging or market activities in securities of Issuer shall be
conducted and shall do so in a manner that it deems appropriate to hedge its
price and market risk with respect to the Relevant Prices; and (D) any market
activities of Dealer and its affiliates with respect to Shares may affect the
market price and volatility of Shares, as well as the Relevant Prices, each in a
manner that may be adverse to Counterparty. Nothing contained in this
Confirmation shall be viewed as inconsistent with this Section 9(w).

 

  (x)

Early Unwind. In the event the sale of the [“Initial Securities”] [“Option
Securities”] (as defined in the Purchase Agreement is not consummated with the
Initial Purchasers for any reason, or Counterparty fails to deliver to Dealer
opinions of counsel as required pursuant to Section 9(a), in each case by 5:00
p.m. (New York City time) on the Premium Payment Date, or such later date as
agreed upon by the parties (the Premium Payment Date or such later date, the
“Early Unwind Date”), the Transaction shall automatically terminate (the “Early
Unwind”) on the Early Unwind Date and (i) the Transaction and all of the
respective rights and obligations of Dealer and Counterparty under the
Transaction shall be cancelled and terminated and (ii) each party shall be
released and discharged by the other party from and agrees not to make any claim
against the other party with respect to any obligations or liabilities of the
other party arising out of and to be performed in connection with the
Transaction either prior to or after the Early Unwind Date; provided that
Counterparty shall purchase from Dealer on the Early Unwind Date all Shares
purchased by Dealer or one or more of its affiliates in connection with the
Transaction at the then prevailing market price. Each of Dealer and Counterparty
represents and acknowledges to the other that, subject to the proviso included
in this Section 9(x), upon an Early Unwind, all obligations with respect to the
Transaction shall be deemed fully and finally discharged.

 

  (y)

Payment by Counterparty. In the event that, following payment of the Premium,
(i) an Early Termination Date occurs or is designated with respect to the
Transaction as a result of a Termination Event or an Event of Default (other
than an Event of Default arising under Section 5(a)(ii) or 5(a)(iv) of the
Agreement) and, as a result, Counterparty owes to Dealer an amount calculated
under Section 6(e) of the Agreement, or (ii) Counterparty owes to Dealer,
pursuant to Section 12.7 or Section 12.9 of the Equity Definitions, an amount
calculated under Section 12.8 of the Equity Definitions, such amount shall be
deemed to be zero.

 

  (z)

Reserved.

 

  (aa)

FATCA. The term “Indemnifiable Tax” as defined in Section 14 of the Agreement
shall not include any tax imposed or collected pursuant to Sections 1471 through
1474 of the Code, any current or future regulations or official interpretations
thereof, any agreement entered into pursuant to Section 1471(b) of the Code, or
any fiscal or regulatory legislation, rules or practices adopted pursuant to any
intergovernmental agreement entered into in connection with the implementation
of such Sections of the Code (a “FATCA Withholding Tax”). For the avoidance of
doubt, a FATCA

 

27

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

 

Withholding Tax is a Tax the deduction or withholding of which is required by
applicable law for the purposes of Section 2(d) of the Agreement.

 

  (bb)

871(m) Provision. To the extent that either party to the Agreement with respect
to this Transaction is not an adhering party to the ISDA 2015 Section 871(m)
Protocol published by the International Swaps and Derivatives Association, Inc.
on November 2, 2015 and available at www.isda.org, as may be amended,
supplemented, replaced or superseded from time to time (the “871(m) Protocol”),
the parties agree that the provisions and amendments contained in the Attachment
to the 871(m) Protocol are incorporated into and apply to the Agreement with
respect to this Transaction as if set forth in full herein. The parties further
agree that, solely for purposes of applying such provisions and amendments to
the Agreement with respect to this Transaction, references to “each Covered
Master Agreement” in the 871(m) Protocol will be deemed to be references to the
Agreement with respect to this Transaction, and references to the
“Implementation Date” in the 871(m) Protocol will be deemed to be references to
the Trade Date of this Transaction. If there is any inconsistency between this
provision and a provision in any other agreement executed between the parties
with respect to the Transaction, this provision shall prevail unless such other
agreement expressly overrides the provisions of the 871(m) Protocol.

 

  (cc)

Payee Tax Representations.

 

  (i)

For the purpose of Section 3(f) of the Agreement, Counterparty makes the
following representation to Dealer:

Counterparty is a corporation established under the laws of the State of
Delaware and is a “United States person” (as that term is defined in
Section 7701(a)(30) of the Code). Counterparty is a “U.S. person” (as that term
is used in section 1.1441-4(a)(3)(ii) of United States Treasury Regulations) for
U.S. federal income tax purposes and an exempt recipient under Treasury
Regulation Section 1.6049-4(c)(1)(ii).

 

  (ii)

For the purpose of Section 3(f) of the Agreement, Dealer makes the following
representation to Counterparty:

[            ]

 

  (dd)

Tax Forms. For the purpose of Sections 4(a)(i) and (ii) of the Agreement,
Counterparty agrees to deliver to Dealer a complete and duly executed United
States Internal Revenue Service Form W-9 (or successor thereto) and Dealer
agrees to deliver to Counterparty a complete and duly executed United States
Internal Revenue Service Form W-[    ] (or successor thereto). Such Forms or
documents shall be delivered upon (i) execution and delivery of this
Confirmation, (ii) promptly upon reasonable request of the other party, and
(iii) promptly upon learning that any such Form or document previously provided
by the other party has become obsolete or incorrect.

 

  (ee)

[Insert any regulatory and agency boilerplate]

 

  (ff)

[Insert QFC language, if applicable]

[Signature pages follow]

 

28

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Counterparty hereby agrees (a) to check this 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 Dealer) correctly sets forth the terms of the agreement between
Dealer and Counterparty with respect to the Transaction, by executing this
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 [            ].

 

Very truly yours,

 

 

[DEALER]

 

 

By:

 

 

 

            

Name:

 

Title:

 

 

[Signature Page to Base Bond Hedge]

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

Accepted and confirmed

as of the Trade Date:

 

    DICK’S Sporting Goods, Inc.

 

    By:

 

 

    Name:

    Title:

 

[Signature Page to Base Bond Hedge]