Exhibit 10.1

EXECUTION VERSION

GOLDMAN, SACHS & CO. | 200 WEST STREET | NEW YORK, NEW YORK 10282-2198 | TEL:
212-902-1000

Opening Transaction

 

To:   

Emulex Corporation

3333 Susan Street

Costa Mesa, California 92626

A/C:    046272399 From:    Goldman, Sachs & Co. Re:    Accelerated Stock Buyback
Ref. No:    As provided in the Supplemental Confirmation Date:    November 13,
2013

 

 

This master confirmation (this “Master Confirmation”), dated as of November 13,
2013 is intended to set forth certain terms and provisions of certain
Transactions (each, a “Transaction”) entered into from time to time between
Goldman, Sachs & Co. (“GS&Co.”) and Emulex Corporation (“Counterparty”). This
Master Confirmation, taken alone, is neither a commitment by either party to
enter into any Transaction nor evidence of a Transaction. The additional terms
of any particular Transaction shall be set forth in a Supplemental Confirmation
in the form of Schedule A hereto (a “Supplemental Confirmation”), which shall
reference this Master Confirmation and supplement, form a part of, and be
subject to this Master Confirmation. This Master Confirmation and each
Supplemental Confirmation together shall constitute a “Confirmation” as referred
to in the Agreement specified below.

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

This Master Confirmation and each Supplemental Confirmation supplement, form a
part of, and are subject to an agreement in the form of the 1992 ISDA Master
Agreement (Multicurrency-Cross Border) (the “Agreement”) as if GS&Co. and
Counterparty had executed the Agreement on the date of this Master Confirmation
(but without any Schedule except for (i) the election of Loss and Second Method,
New York law (without reference to its choice of laws doctrine other than Title
14 of Article 5 of the New York General Obligations Law) as the governing law
and US Dollars (“USD”) as the Termination Currency, (ii) the election that
subparagraph (ii) of Section 2(c) will not apply to the Transactions, (iii) the
election that the “Cross Default” provisions of Section 5(a)(vi) shall apply to
GS&Co., with a “Threshold Amount” of 3% of the stockholders’ equity of The
Goldman Sachs Group, Inc. (“GS Parent”) as of the Trade Date and to
Counterparty, with a “Threshold Amount” of USD 25 million and (iv) the deletion
of the words “, or becoming capable at such time of being declared,” from such
Section 5(a)(vi)).

The Transactions shall be the sole Transactions under the Agreement. If there
exists any ISDA Master Agreement between GS&Co. and Counterparty or any
confirmation or other agreement between GS&Co. and Counterparty pursuant to
which an ISDA Master Agreement is deemed to exist between GS&Co. and
Counterparty, then notwithstanding anything to the contrary in such ISDA Master
Agreement, such confirmation or agreement or any other agreement to which GS&Co.
and Counterparty are parties, the Transactions shall not be considered
Transactions under, or otherwise governed by, such existing or deemed ISDA
Master Agreement.

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

If, in relation to any Transaction to which this Master Confirmation and a
Supplemental Confirmation relate, there is any inconsistency between the
Agreement, this Master Confirmation, any Supplemental Confirmation and the
Equity Definitions, the following will prevail for purposes of such Transaction
in the order of precedence indicated: (i) such Supplemental Confirmation;
(ii) this Master Confirmation; (iii) the Equity Definitions; and (iv) the
Agreement.

1. Each Transaction constitutes a Share Forward Transaction for the purposes of
the Equity Definitions. Set forth below are the terms and conditions that,
together with the terms and conditions set forth in the Supplemental
Confirmation relating to any Transaction, shall govern such Transaction.

General Terms:

 

Trade Date:

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

Buyer:

   Counterparty

Seller:

   GS&Co.

Shares:

   Common stock, par value $0.10 per share, of Counterparty (Ticker: ELX)

Exchange:

   The New York Stock Exchange

Related Exchange(s):

   All Exchanges.

Prepayment\Variable Obligation:

   Applicable

Prepayment Amount:

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

Prepayment Date:

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

VWAP Price:

   For any Exchange Business Day, as determined by the Calculation Agent based
on the New York 10b-18 Volume Weighted Average Price per Share for the regular
trading session (including any extensions thereof) of the Exchange on such
Exchange Business Day (without regard to pre-open or after hours trading outside
of such regular trading session for such Exchange Business Day), as published by
Bloomberg at 4:15 p.m. New York time (or 15 minutes following the end of any
extension of the regular trading session) on such Exchange Business Day, on
Bloomberg page “ELX.N <Equity> AQR_SEC” (or any successor thereto), or if such
price is not so reported on such Exchange Business Day for any reason or, in the
Calculation Agent’s commercially reasonable discretion, is erroneous or has been
reported incorrectly, such VWAP Price shall be as determined in good faith by
the Calculation Agent in a commercially reasonable manner to substitute for such
unreported or erroneous price, which price Calculation Agent will base on only
those trades that are Rule 10b-18 eligible transactions (as defined below). For
purposes of calculating the VWAP Price, the Calculation Agent will include only
those trades that are reported during the period of time during which
Counterparty could purchase its own shares under Rule 10b-18(b)(2) and are
effected pursuant to the conditions of Rule 10b-18(b)(3), each under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”) (such trades,
“Rule 10b-18 eligible transactions”).

 

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Forward Price:

   The average of the VWAP Prices for the Exchange Business Days in the
Calculation Period, subject to “Valuation Disruption” below.

Forward Price Adjustment Amount:

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

Calculation Period:

   The period from and including the Calculation Period Start Date to and
including the Termination Date.

Calculation Period Start Date:

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

Termination Date:

   The Scheduled Termination Date; provided that GS&Co. shall have the right to
designate any Exchange Business Day on or after the First Acceleration Date to
be the Termination Date for the entire Transaction (the “Accelerated Termination
Date”) by delivering notice to Counterparty of any such designation prior to
11:59 p.m. New York City time on the Exchange Business Day immediately following
the designated Accelerated Termination Date.

Scheduled Termination Date:

   For each Transaction, as set forth in the related Supplemental Confirmation,
subject to postponement as provided in “Valuation Disruption” below.

First Acceleration Date:

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

Valuation Disruption:

   The definition of “Market Disruption Event” in Section 6.3(a) of the Equity
Definitions is hereby amended by deleting the words “at any time during the
one-hour period that ends at the relevant Valuation Time, Latest Exercise Time,
Knock-in Valuation Time or Knock-out Valuation Time, as the case may be” and
inserting the words “at any time on any Scheduled Trading Day during the
Calculation Period or Settlement Valuation Period” after the word “material,” in
the third line thereof.    Section 6.3(d) of the Equity Definitions is hereby
amended by deleting the remainder of the provision following the term “Scheduled
Closing Time” in the fourth line thereof.    Notwithstanding anything to the
contrary in the Equity Definitions, to the extent that a Disrupted Day occurs
(i) in the Calculation Period, the Calculation Agent may, in its good faith and
commercially reasonable discretion, postpone the Scheduled Termination Date by
the number of Scheduled Trading Days equal to the number of Disrupted Days
during the Calculation Period, or (ii) in the Settlement Valuation Period, the
Calculation Agent may, in its good faith and commercially reasonable discretion,
extend the Settlement Valuation Period by the number of Scheduled Trading Days
equal to the number of Disrupted Days during the Settlement Valuation Period. If
any such Disrupted Day is a Disrupted Day because of a Market Disruption Event
(or a deemed Market Disruption Event as provided herein), the Calculation Agent
shall determine whether (i) such Disrupted Day is a Disrupted Day in full, in
which case the VWAP Price for such Disrupted Day shall not be included for
purposes of determining the Forward Price or the Settlement Price, as the case
may be, or (ii) such Disrupted Day is a Disrupted Day only in part, in which
case the VWAP Price for such Disrupted Day shall be determined by the
Calculation Agent based on Rule 10b-18 eligible transactions in the Shares on
such Disrupted Day taking into account the nature and duration of the relevant
Market Disruption Event, and the weighting of the VWAP Price for the relevant
Exchange

 

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   Business Days during the Calculation Period or the Settlement Valuation
Period, as the case may be, shall be adjusted in a commercially reasonable
manner by the Calculation Agent for purposes of determining the Forward Price or
the Settlement Price, as the case may be, with such adjustments based on, among
other factors, the duration of any Market Disruption Event and the volume,
historical trading patterns and price of the Shares. Any Exchange Business Day
on which, as of the date hereof, the Exchange is scheduled to close prior to its
normal close of trading shall be deemed not to be an Exchange Business Day; if a
closure of the Exchange prior to its normal close of trading on any Exchange
Business Day is scheduled following the date hereof, then such Exchange Business
Day shall be deemed to be a Disrupted Day in full.    If a Disrupted Day occurs
during the Calculation Period or the Settlement Valuation Period, as the case
may be, and each of the nine immediately following Scheduled Trading Days is a
Disrupted Day, then the Calculation Agent, in its good faith and commercially
reasonable discretion, may deem such ninth Scheduled Trading Day to be an
Exchange Business Day that is not a Disrupted Day and determine the VWAP Price
for such ninth Scheduled Trading Day using its good faith estimate of the value
of the Shares on such ninth Scheduled Trading Day based on the volume,
historical trading patterns and price of the Shares. Settlement Terms:   

Settlement Procedures:

   If the Number of Shares to be Delivered is positive, Physical Settlement
shall be applicable; provided that GS&Co. does not, and shall not, make the
agreement or the representations set forth in Section 9.11 of the Equity
Definitions related to the restrictions imposed by applicable securities laws
with respect to any Shares delivered by GS&Co. to Counterparty under any
Transaction. If the Number of Shares to be Delivered is negative, then the
Counterparty Settlement Provisions in Annex A shall apply.

Number of Shares to be Delivered:

  

 

A number of Shares equal to (x)(a) the Prepayment Amount divided by (b) the
Divisor Amount minus (y) the number of Initial Shares.

Divisor Amount:

   The greater of (i) the Forward Price minus the Forward Price Adjustment
Amount and (ii) $1.00.

Excess Dividend Amount:

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

Settlement Date:

   If the Number of Shares to be Delivered is positive, the date that is one
Settlement Cycle immediately following the Termination Date.

Settlement Currency:

   USD

Initial Share Delivery:

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

Initial Share Delivery Date:

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

Initial Delivery Percentage:

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

 

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Initial Shares:

   For each Transaction, the number of Shares set forth in the related
Supplemental Confirmation. Share Adjustments:   

Potential Adjustment Event:

   Notwithstanding anything to the contrary in Section 11.2(e) of the Equity
Definitions, an Extraordinary Dividend shall not constitute a Potential
Adjustment Event.    It shall constitute an additional Potential Adjustment
Event if the Scheduled Termination Date for any Transaction is postponed
pursuant to “Valuation Disruption” above, in which case the Calculation Agent
may, in its commercially reasonable discretion, adjust any relevant terms of any
such Transaction as appropriate to account for the economic effect on the
Transaction of such postponement.

Extraordinary Dividend:

   Any dividend or distribution on the Shares (other than any dividend or
distribution of the type described in Section 11.2(e)(i) or Section
11.2(e)(ii)(A) of the Equity Definitions.

Method of Adjustment:

   Calculation Agent Adjustment Extraordinary Events:   

Consequences of Merger Events:

  

(a)    Share-for-Share:

  

Modified Calculation Agent Adjustment

(b)    Share-for-Other:

  

Cancellation and Payment

(c)    Share-for-Combined:

  

Component Adjustment

Tender Offer:

   Applicable; provided that (i) Section 12.1 (d) of the Equity Definitions
shall be deleted in its entirety and replaced with the following: ““Tender
Offer” means the commencement (in the case of a takeover offer, tender offer,
exchange offer, or solicitation, proposal or other event initiated by any person
other than Counterparty) or public announcement (in the case of a takeover
offer, tender offer, exchange offer, or solicitation, proposal or other event
initiated by Counterparty) of a takeover offer, tender offer, exchange offer, or
solicitation, proposal or other event by any entity or person that following
such commencement or announcement, as applicable, would, if consummated, result
in such entity or person purchasing or otherwise obtaining or having the right
to obtain, by conversion or other means, greater than 20% and less than 100% of
the outstanding voting shares of Counterparty, as determined by Calculation
Agent based upon such information as Calculation Agent deems relevant”, (ii)
Section 12.1(l) of the Equity Definitions shall be amended (x) by deleting the
parenthetical in the fifth line thereof, (y) by replacing “that” in the fifth
line thereof with “whether or not such announcement” and (z) by adding
immediately after the words “Tender Offer” in the fifth line thereof “, and any
publicly announced change or amendment to such an announcement (including the
announcement of an abandonment of such intention)” and (iii) Sections 12.3(a)
and 12.3(d) of the Equity Definitions shall each be amended by replacing each
occurrence of the words “Tender Offer Date” with “Announcement Date.”

 

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Consequences of Tender Offers:

  

(a)    Share-for-Share:

  

Modified Calculation Agent Adjustment

(b)    Share-for-Other:

  

Modified Calculation Agent Adjustment

(c)    Share-for-Combined:

  

Modified Calculation Agent Adjustment

Nationalization, Insolvency or Delisting:

  

 

Cancellation and Payment; provided that in addition to the provisions of Section
12.6(a)(iii) of the Equity Definitions, it shall also constitute a Delisting if
the Exchange is located in the United States and the Shares are not immediately
re-listed, re-traded or re-quoted on any of the New York Stock Exchange, the
American Stock Exchange, The NASDAQ Global Select Market or The NASDAQ Global
Market (or their respective successors); if the Shares are immediately
re-listed, re-traded or re-quoted on any such exchange or quotation system, such
exchange or quotation system shall be deemed to be the Exchange.

Additional Disruption Events:   

(a)    Change in Law:

  

Applicable; provided that Section 12.9(a)(ii) of the Equity Definitions is
hereby amended by (i) replacing the phrase “the interpretation” in the third
line thereof with the phrase “, or public announcement of, the formal or
informal interpretation”, (ii) by replacing the word “Shares” where it appears
in clause (X) thereof with the words “Hedge Position” and (iii) by immediately
following the word “Transaction” in clause (X) thereof, adding the phrase “in
the manner contemplated by the Hedging Party on the Trade Date”; provided
further that (i) any determination as to whether (A) the adoption of or any
change in any applicable law or regulation (including, for the avoidance of
doubt and without limitation, (x) any tax law or (y) adoption or promulgation of
new regulations authorized or mandated by existing statute) or (B) the
promulgation of or any change in the interpretation by any court, tribunal or
regulatory authority with competent jurisdiction of any applicable law or
regulation (including any action taken by a taxing authority), in each case,
constitutes a “Change in Law” shall be made by the Hedging Party in good faith
and in a commercially reasonable manner and in a manner consistent with the
requirements, policies or procedures of the Hedging Party that are generally
applicable in similar situations and applied to the relevant Transaction (but
without regard to Section 739 of the Dodd-Frank Wall Street Reform and Consumer
Protection Act of 2010 or any similar legal certainty provision in any
legislation enacted, or rule or regulation promulgated, on or after the Trade
Date), and (ii) Section 12.9(a)(ii) of the Equity Definitions is hereby amended
by replacing the parenthetical beginning after the word “regulation” in the
second line thereof the words “(including, for the avoidance of doubt and
without limitation, (x) any tax law or (y) adoption or promulgation of new
regulations authorized or mandated by existing statute)”.

(b)    Failure to Deliver:

  

Applicable

 

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(c)    Insolvency Filing:

   Applicable

(d)    Hedging Disruption:

   Applicable; provided that Section 12.9(a)(v) of the Equity Definitions is
hereby amended by adding the following proviso at the end thereof: “, provided
that any such inability that occurs solely due to the deterioration of the
creditworthiness of the Hedging Party shall not be deemed a Hedging Disruption”;
provided further that, notwithstanding anything in the Equity Definitions, the
Hedging Party shall act in a commercially reasonable manner in acquiring,
establishing, re-establishing, substituting, maintaining, unwinding or disposing
of any transaction(s) or asset(s) it deems necessary to hedge the equity price
risk of entering into and performing its obligations (any such activities,
“Hedging Activities”) with respect to any Transaction.

(e)    Increased Cost of Hedging:

   Applicable; provided that, notwithstanding anything in the Equity
Definitions, the Hedging Party shall act in a commercially reasonable manner in
conducting its Hedging Activities with respect to any Transaction.

(f)     Loss of Stock Borrow:

   Applicable

 Maximum Stock Loan Rate:

   200 basis points per annum

 Hedging Party:

   GS&Co.

(g)    Increased Cost of Stock Borrow:

   Applicable

 Initial Stock Loan Rate:

   25 basis points per annum

 Hedging Party:

   GS&Co.

 Determining Party:

   GS&Co.; provided that, upon reasonable written request by Counterparty
following any determination or calculation made by the Determining Party
hereunder, the Determining Party shall provide to Counterparty reasonably
promptly (and shall in good faith attempt to provide within 5 Exchange Business
Days) written explanation of any determination made by it including, where
applicable, a description of the methodology and the basis for such
determination in reasonable detail, it being understood that the Determining
Party shall not be obligated to disclose (i) any proprietary models or positions
and (ii) any information to the extent it would be in violation of any
applicable law, regulation, policy or contractual obligation. Additional
Termination Event(s):   Notwithstanding anything to the contrary in the Equity
Definitions, if, as a result of an Extraordinary Event, any Transaction would be
cancelled or terminated (whether in whole or in part) pursuant to Article 12 of
the Equity Definitions, an Additional Termination Event (with such terminated
Transaction(s) (or portions thereof) being the Affected Transaction(s) and
Counterparty being the sole Affected Party) shall be deemed to occur, and, in
lieu of Sections 12.7, 12.8 and 12.9 of the Equity Definitions, Section 6 of the
Agreement shall apply to such Affected Transaction(s).

 

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   The declaration by the Issuer of any Extraordinary Dividend, the ex-dividend
date for which occurs or is scheduled to occur during the Relevant Dividend
Period, will constitute an Additional Termination Event, with Counterparty as
the sole Affected Party and all Transactions hereunder as the Affected
Transactions. Relevant Dividend Period:    The period from and including the
Calculation Period Start Date to and including the Relevant Dividend Period End
Date. Relevant Dividend Period End Date:   

 

If the Number of Shares to be Delivered is negative, the last day of the
Settlement Valuation Period; otherwise, the Termination Date.

Non-Reliance/Agreements and Acknowledgements Regarding Hedging
Activities/Additional Acknowledgements:    Applicable Transfer:   
Notwithstanding anything to the contrary in the Agreement, GS&Co. may transfer
or assign without any consent of Counterparty its rights and obligations
hereunder, in whole or in part, to any of its affiliates or a national bank or
any affiliate thereof or any such affiliate, bank or bank affiliate whose
obligations would be guaranteed by a person, in either case, of credit quality
equivalent to or better than that of GS Parent; provided that (i) an Event of
Default, Potential Event of Default or Termination Event will not occur, and at
the time of transfer would not reasonably be expected to occur, as a result of
such transfer and assignment and (ii) as a result of such transfer and
assignment, Counterparty will not be, and at the time of transfer would not
reasonably be expected to be, required to pay the transferee on any payment date
an amount under Section 2(d)(i)(4) of the Agreement greater than an amount that
Counterparty would have been required to pay to GS&Co. in the absence of such
transfer and assignment. GS&Co. Payment Instructions:    Chase Manhattan Bank
New York    For A/C Goldman, Sachs & Co.    A/C #930-1-011483    ABA: 021-000021
Counterparty’s Contact Details for Purpose of Giving Notice:    To be provided
by Counterparty GS&Co.’s Contact Details for Purpose of Giving Notice:   
Goldman, Sachs & Co.    200 West Street    New York, NY 10282-2198    Attention:
Vijay Culas, Equity Capital Markets    Telephone: +1-415-249-7383    Facsimile:
+1-212-428-1898    Email: vijay.culas@gs.com    With a copy to:    Attention:
Kevin Castellano, Equity Capital Markets    Telephone: +1-415-249-7384   
Facsimile: +1-646-769-7571    Email: kevin.castellano@gs.com

 

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   And email notification to the following address:   
Eq-derivs-notifications@am.ibd.gs.com 2. Calculation Agent.    GS&Co.; provided
that, upon reasonable written request by Counterparty following any
determination or calculation made by the Calculation Agent hereunder, the
Calculation Agent shall provide to Counterparty reasonably promptly (and shall
in good faith attempt to provide within 5 Exchange Business Days) a written
explanation of such calculation or determination, it being understood that the
Calculation Agent shall not be obligated to disclose (i) any proprietary models
or positions and (ii) any information to the extent it would be in violation of
any applicable law, regulation, policy or contractual obligation.

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

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

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

4. Additional Representations, Warranties and Covenants of Counterparty. In
addition to the representations, warranties and covenants in the Agreement,
Counterparty represents, warrants and covenants to GS&Co. that:

(a) The purchase or writing of each Transaction and the transactions
contemplated hereby will not violate Rule 13e-1 or Rule 13e-4 under the Exchange
Act.

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

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

(d) Without limiting the generality of Section 13.1 of the Equity Definitions,
Counterparty acknowledges that neither GS&Co. nor any of its affiliates is
making any representations or warranties or taking any position or expressing
any view with respect to the treatment of any Transaction under any accounting
standards including ASC Topic 260, Earnings Per Share, ASC Topic 815,
Derivatives and Hedging, or ASC Topic 480, Distinguishing Liabilities from
Equity and ASC 815-40, Derivatives and Hedging – Contracts in Entity’s Own
Equity.

(e) As of (i) the date hereof and (ii) the Trade Date for each Transaction
hereunder, Counterparty is in compliance with its reporting obligations under
the Exchange Act and its most recent Annual Report on Form 10-K,

 

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together with all reports subsequently filed by it pursuant to the Exchange Act,
taken together and as amended and supplemented to the date of this
representation, do not, as of their respective filing dates, contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.

(f) Counterparty shall report each Transaction as required under the Exchange
Act and the rules and regulations thereunder.

(g) The Shares are not, and Counterparty will not cause the Shares to be,
subject to a “restricted period” (as defined in Regulation M promulgated under
the Exchange Act) at any time during any Regulation M Period (as defined below)
for any Transaction unless Counterparty has provided written notice to GS&Co. of
such restricted period not later than the Scheduled Trading Day immediately
preceding the first day of such “restricted period”; Counterparty acknowledges
that any such notice may cause a Disrupted Day to occur pursuant to Section 5
below; accordingly, Counterparty acknowledges that its delivery of such notice
must comply with the standards set forth in Section 6 below; “Regulation M
Period” means, for any Transaction, (i) the Relevant Period (as defined below)
and (ii) the Settlement Valuation Period, if any, for such Transaction.
“Relevant Period” means, for any Transaction, the period commencing on the
Calculation Period Start Date for such Transaction and ending on the earlier of
(i) the Scheduled Termination Date and (ii) the last Additional Relevant Day (as
specified in the related Supplemental Confirmation) for such Transaction, or
such earlier day as elected by GS&Co. and communicated to Counterparty on such
day (or, if later, the First Acceleration Date without regard to any
acceleration thereof pursuant to “Special Provisions for Acquisition Transaction
Announcements” below).

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

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

(j) Counterparty will not take any action or refrain from taking any action that
would limit or in any way adversely affect GS&Co.’s rights under the Agreement,
this Master Confirmation or any Supplemental Confirmation.

(k) Counterparty has not and will not enter into agreements similar to the
Transactions described herein where any initial hedge period, calculation
period, relevant period or settlement valuation period (each however defined) in
such other transaction will overlap at any time (including as a result of
extensions in such initial hedge period, calculation period, relevant period or
settlement valuation period as provided in the relevant agreements) with any
Relevant Period or, if applicable, any Settlement Valuation Period under this
Master Confirmation. In the event that the initial hedge period, relevant
period, calculation period or settlement valuation period in any other similar
transaction overlaps with any Relevant Period or, if applicable, Settlement
Valuation Period under this Master Confirmation as a result of any postponement
of the Scheduled Termination Date or extension of the Settlement Valuation
Period pursuant to “Valuation Disruption” above, Counterparty shall promptly
amend such transaction to avoid any such overlap.

5. Regulatory Disruption. In the event that GS&Co. concludes, in its good faith
reasonable discretion, that it is appropriate with respect to any legal,
regulatory or self-regulatory requirements or related legal, regulatory or
self-regulatory policies and procedures (whether or not such requirements,
policies or procedures are imposed by law or have been voluntarily adopted by
GS&Co., but provided that such requirements, policies or procedures are
generally applicable in similar situations and applied to the relevant
Transaction in a non-discriminatory manner), for it to refrain from or decrease
any activity in the U.S. securities markets in which it would have otherwise
engaged in connection with any Transaction on any Scheduled Trading Day or Days
during the Calculation Period or, if applicable, the Settlement Valuation
Period, GS&Co. may by written notice to Counterparty elect to deem that a Market
Disruption Event has occurred and will be continuing on such Scheduled Trading
Day or Days.

 

10

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

(a) Counterparty is entering into this Master Confirmation and each Transaction
hereunder in good faith and not as part of a plan or scheme to evade the
prohibitions of Rule 10b5-1 under the Exchange Act (“Rule 10b5-1”) or any other
antifraud or anti-manipulation provisions of the federal or applicable state
securities laws and that it has not entered into or altered and will not enter
into or alter any corresponding or hedging transaction or position with respect
to the Shares. Counterparty acknowledges that it is the intent of the parties
that each Transaction entered into under this Master Confirmation comply with
the requirements of paragraphs (c)(1)(i)(A) and (B) of Rule 10b5-1 and each
Transaction entered into under this Master Confirmation shall be interpreted to
comply with the requirements of Rule 10b5-1(c).

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

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

7. Counterparty Purchases. (a) Counterparty (or any “affiliated purchaser” as
defined in Rule 10b-18 under the Exchange Act (“Rule 10b-18”)) shall not,
without the prior written consent of GS&Co., directly or indirectly purchase any
Shares (including by means of a derivative instrument), listed contracts on the
Shares or securities that are convertible into, or exchangeable or exercisable
for Shares (including, without limitation, any Rule 10b-18 purchases of blocks
(as defined in Rule 10b-18)) during any Relevant Period or, if applicable,
Settlement Valuation Period, except through GS&Co.; provided that Counterparty
may, without the prior written consent of GS&Co., purchase Shares (i) from
participants in Counterparty’s equity compensation plans that occur or are
deemed to occur in connection with the payment of any exercise price or in
satisfaction of tax withholding obligations or otherwise in connection with the
vesting and/or exercise of any equity awards and (ii) from one or more existing
holders of Shares, in bilateral, privately-negotiated transactions that do not,
directly or indirectly, involve purchases of Shares on the Exchange (and, for
the avoidance of doubt, do not constitute a block purchase (within the meaning
of Rule 10b-18)).

(b) GS&Co. covenants to Counterparty that with respect to purchases of Shares by
GS&Co. or any of its affiliates in connection with its hedging activities in
relation to any Transaction GS&Co. or such affiliate will use good faith efforts
to effect such purchases in a manner so that, if such purchases were made by
Counterparty, they would meet the requirements of paragraphs (b)(2), (3) and
(4) of Rule 10b-18 (taking into account any applicable Securities and Exchange
Commission or staff no-action letters or interpretations as appropriate and
subject to any delays between execution and reporting of a trade of the Shares
on the Exchange and other circumstances reasonably beyond GS&Co.’s or such
affiliate’s control); provided that, GS&Co. and its affiliates shall not be
responsible for any failure to comply with Rule 10b-18(b)(3) to the extent any
transaction that was executed (or deemed to be executed) by or on behalf of
Counterparty or an affiliated purchaser pursuant to a separate agreement is not
deemed to be an “independent bid” or an “independent transaction” for purposes
of Rule 10b-18(b)(3); and provided further that such covenant shall not apply to
any purchases of Shares made by GS&Co. or any of its affiliates during or
following the Calculation Period that are dynamic hedging adjustments
(including, without limitation, dynamic hedging adjustments in respect of timing
options embedded in any Transaction) made by GS&Co. or its affiliate in respect
of the embedded optionality in such Transaction (which, for the avoidance of
doubt shall include, without limitation, dynamic hedging adjustments that are
purchases in connection with, or to hedge GS&Co.’s equity price risk upon,
exercise of GS&Co.’s option to shorten the Calculation Period).

 

11

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

(a) Counterparty agrees that it:

(i) will not during the period commencing on the Trade Date through the end of
the Relevant Period or, if applicable, the Settlement Valuation Period for any
Transaction make, or permit to be made, any public announcement (as defined in
Rule 165(f) under the Securities Act) of any Merger Transaction or potential
Merger Transaction (a “Public Announcement”) unless such Public Announcement is
made prior to the opening or after the close of the regular trading session on
the Exchange for the Shares;

(ii) shall promptly (but in any event prior to the next opening of the regular
trading session on the Exchange) notify GS&Co. following any such Public
Announcement that such Public Announcement has been made; and

(iii) shall promptly (but in any event prior to the next opening of the regular
trading session on the Exchange) provide GS&Co. with written notice specifying
(i) Counterparty’s average daily Rule 10b-18 Purchases (as defined in Rule
10b-18) during the three full calendar months immediately preceding the
announcement date that were not effected through GS&Co. or its affiliates and
(ii) the number of Shares purchased pursuant to the proviso in Rule 10b-18(b)(4)
under the Exchange Act for the three full calendar months preceding the date of
such Public Announcement. Such written notice shall be deemed to be a
certification by Counterparty to GS&Co. that such information is true and
correct. In addition, Counterparty shall promptly notify GS&Co. of the earlier
to occur of the completion of the relevant Merger Transaction and the completion
of the vote by target shareholders.

(b) Counterparty acknowledges that a Public Announcement may cause the terms of
any Transaction to be adjusted in a commercially reasonable manner or such
Transaction to be terminated; accordingly, Counterparty acknowledges that in
making any Public Announcement, it must comply with the standards set forth in
Section 6 above.

(c) Upon the occurrence of any Public Announcement (whether made by Counterparty
or a third party), GS&Co. in its sole discretion may (i) in a good faith and
commercially reasonable manner, to the extent no corresponding adjustments are
being made in connection with such Public Announcement pursuant to Section 9
hereof, make adjustments in a good faith and commercially reasonable manner to
the terms of any Transaction, including, without limitation, the Scheduled
Termination Date or the Forward Price Adjustment Amount, and/or suspend the
Calculation Period and/or any Settlement Valuation Period to account for the
economic effect of such Public Announcement on such Transaction or (ii) treat
the occurrence of such Public Announcement as an Additional Termination Event
with Counterparty as the sole Affected Party and the Transactions hereunder as
the Affected Transactions and with the amount under Section 6(e) of the
Agreement determined taking into account the fact that the Calculation Period or
Settlement Valuation Period, as the case may be, had fewer Scheduled Trading
Days than originally anticipated.

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

9. Special Provisions for Acquisition Transaction Announcements. (a) If an
Acquisition Transaction Announcement occurs on or prior to the Settlement Date
for any Transaction, then the Calculation Agent shall make such adjustments in a
commercially reasonable manner, to the exercise, settlement, payment or any
other terms of such Transaction (including, without limitation, the Forward
Price Adjustment Amount) as the Calculation Agent determines appropriate, at
such time or at multiple times as the Calculation Agent determines appropriate,
to account for the economic effect on such Transaction of such Acquisition
Transaction Announcement (such adjustments which are limited to account for
changes in volatility, stock loan rate and liquidity relevant to the Shares or
to such Transaction).

 

12

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(b) “Acquisition Transaction Announcement” means (i) the announcement of an
Acquisition Transaction, (ii) an announcement that Counterparty or any of its
subsidiaries has entered into an agreement, a letter of intent or an
understanding designed to result in an Acquisition Transaction, (iii) the
announcement of the intention to solicit or enter into, or to explore strategic
alternatives or other similar undertaking that may include, an Acquisition
Transaction, (iv) any other announcement that in the reasonable judgment of the
Calculation Agent may result in an Acquisition Transaction or (v) any
announcement of any change or amendment to any previous Acquisition Transaction
Announcement (including any announcement of the abandonment of any such
previously announced Acquisition Transaction, agreement, letter of intent,
understanding or intention). For the avoidance of doubt, announcements as used
in the definition of Acquisition Transaction Announcement refer to any public
announcement whether made by the Issuer or a third party.

(c) “Acquisition Transaction” means (i) any Merger Event (for purposes of this
definition the definition of Merger Event shall be read with the references
therein to “100%” being replaced by “20%” and to “50%” by “75%” and without
reference to the clause beginning immediately following the definition of
Reverse Merger therein to the end of such definition), Tender Offer or Merger
Transaction or any other transaction involving the merger of Counterparty with
or into any third party, (ii) the sale or transfer of all or substantially all
of the assets of Counterparty, (iii) a recapitalization, reclassification,
binding share exchange or other similar transaction with respect to
Counterparty, (iv) any acquisition, lease, exchange, transfer, disposition
(including by way of spin-off or distribution) of assets (including any capital
stock or other ownership interests in subsidiaries) or other similar event by
Counterparty or any of its subsidiaries where the aggregate consideration
transferable or receivable by or to Counterparty or its subsidiaries exceeds 25%
of the market capitalization of Counterparty and (v) any transaction in which
Counterparty or its board of directors has a legal obligation to make a
recommendation to its shareholders in respect of such transaction (whether
pursuant to Rule 14e-2 under the Exchange Act or otherwise).

10. Acknowledgments. (a) The parties hereto intend for:

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

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

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

(iv) all payments for, under or in connection with each Transaction, all
payments for the Shares (including, for the avoidance of doubt, payment of the
Prepayment Amount) and the transfer of such Shares to constitute “settlement
payments” and “transfers” (as defined in the Bankruptcy Code).

(b) Counterparty acknowledges that:

(i) during the term of any Transaction, GS&Co. 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 establish, adjust or
unwind its hedge position with respect to such Transaction;

(ii) GS&Co. and its affiliates may also be active in the market for the Shares
and derivatives linked to the Shares other than in connection with hedging
activities in relation to any Transaction, including acting as agent or as
principal and for its own account or on behalf of customers;

 

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(iii) GS&Co. shall make its own determination as to whether, when or in what
manner any hedging or market activities in Counterparty’s securities 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 Forward Price and the VWAP Price;

(iv) any market activities of GS&Co. and its affiliates with respect to the
Shares may affect the market price and volatility of the Shares, as well as the
Forward Price and VWAP Price, each in a manner that may be adverse to
Counterparty; and

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

(c) Counterparty:

(a) is an “institutional account” as defined in FINRA Rule 4512(c);

(b) is capable of evaluating investment risks independently, both in general and
with regard to all transactions and investment strategies involving a security
or securities, and will exercise independent judgment in evaluating the
recommendations of GS&Co. or its associated persons, unless it has otherwise
notified GS&Co. in writing; and

(c) will notify GS&Co. if any of the statements contained in clause (i) or
(ii) of this Section 12(c) ceases to be true.

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

12. No Set-off. The parties hereto acknowledge that all payments to be made
under any Transaction hereunder shall be calculated and be made without (and
free and clear of any deduction for) set-off.

13. Delivery of Shares. Notwithstanding anything to the contrary herein, GS&Co.
may, by prior notice to Counterparty, satisfy its obligation to deliver any
Shares or other securities on any date due (an “Original Delivery Date”) by
making separate deliveries of Shares or such securities, as the case may be, at
more than one time on or prior to such Original Delivery Date, so long as the
aggregate number of Shares and other securities so delivered on or prior to such
Original Delivery Date is equal to the number required to be delivered on such
Original Delivery Date.

14. Early Termination. In the event that an Early Termination Date (whether as a
result of an Event of Default or a Termination Event) occurs or is designated
with respect to any Transaction (except as a result of a Merger Event in which
the consideration or proceeds to be paid to holders of Shares consists solely of
cash), if either party would owe any amount to the other party pursuant to
Section 6(d)(ii) of the Agreement (any such amount, a “Payment Amount”), then,
in lieu of any payment of such Payment Amount, Counterparty may, no later than
the Early Termination Date or the date on which such Transaction is terminated,
elect to deliver or for GS&Co. to deliver, as the case may be, to the other
party a number of Shares (or, in the case of a Merger Event, a number of units,
each comprising the number or amount of the securities or property that a
hypothetical holder of one Share would receive in such Merger Event (each such
unit, an “Alternative Delivery Unit” and, the securities or property comprising
such unit, “Alternative Delivery Property”)) with a value equal to the Payment
Amount, as determined by the Calculation Agent in its commercially reasonable
judgment (and the parties agree that, in making such determination of value, the
Calculation Agent may, acting in good faith, take into account a number of
factors, including the market price of the Shares or Alternative Delivery
Property on the date of early termination and, if such delivery is made by
GS&Co., the prices at which GS&Co. purchases Shares or Alternative Delivery
Property in a commercially reasonable manner and within a commercially
reasonable time period to fulfill its delivery obligations under this
Section 14); provided that in determining the composition of any Alternative
Delivery Unit, if the relevant Merger Event involves a choice of consideration
to be received by holders, such holder shall be deemed to have elected to
receive the maximum possible amount of cash; and provided further that
Counterparty may make

 

14

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such election only if Counterparty represents and warrants to GS&Co. in writing
on the date it notifies GS&Co. of such election that, as of such date,
Counterparty is not aware of any material non-public information concerning the
Shares and is making such election in good faith and not as part of a plan or
scheme to evade compliance with the federal securities laws. If such delivery is
made by Counterparty, paragraphs 2 through 7 of Annex A shall apply as if such
delivery were a settlement of the Transaction to which Net Share Settlement
applied, the Cash Settlement Payment Date were the Early Termination Date and
the Forward Cash Settlement Amount were zero (0) minus the Payment Amount owed
by Counterparty.

15. Calculations and Payment Date upon Early Termination. The parties
acknowledge and agree that in calculating Loss pursuant to Section 6 of the
Agreement GS&Co., acting in good faith and in a commercially reasonable manner,
may (but need not) determine losses (or gains) without reference to actual
losses (or gains) incurred but based on expected losses (or gains) assuming a
commercially reasonable (including without limitation with regard to reasonable
legal and regulatory guidelines) risk bid were used to determine loss (or gain)
to avoid awaiting the delay associated with closing out any commercially
reasonable hedge or related trading position in a commercially reasonable manner
prior to or sooner following the designation of an Early Termination Date.
Notwithstanding anything to the contrary in Section 6(d)(ii) of the Agreement,
all amounts calculated as being due in respect of an Early Termination Date
under Section 6(e) of the Agreement will be payable on the day that notice of
the amount payable is effective; provided that if Counterparty elects to receive
Shares or Alternative Delivery Property in accordance with Section 14, such
Shares or Alternative Delivery Property shall be delivered on a date selected by
GS&Co in a commercially reasonable manner and as promptly as practicable.

16. Automatic Termination Provisions. Notwithstanding anything to the contrary
in Section 6 of the Agreement, if a Termination Price is specified in any
Supplemental Confirmation, then an Additional Termination Event with
Counterparty as the sole Affected Party and the Transaction to which such
Supplemental Confirmation relates as the Affected Transaction will automatically
occur without any notice or action by GS&Co. or Counterparty if the price of the
Shares on the Exchange at any time closes below such Termination Price, and the
Exchange Business Day that the price of the Shares on the Exchange at any time
closes below the Termination Price will be the “Early Termination Date” for
purposes of the Agreement.

17. Delivery of Cash. For the avoidance of doubt, nothing in this Master
Confirmation shall be interpreted as requiring Counterparty to deliver cash or
other assets in respect of the settlement of the Transactions contemplated by
this Master Confirmation following payment by Counterparty of the relevant
Prepayment Amount, except in circumstances where the required cash settlement
(or settlement in other assets) thereof is permitted for classification of the
contract as equity by ASC 815-40, Derivatives and Hedging – Contracts in
Entity’s Own Equity, as in effect on the relevant Trade Date (including, without
limitation, where Counterparty so elects to deliver cash (or other assets) or
fails timely to elect to deliver Shares or Alternative Delivery Property in
respect of the settlement of such Transactions).

18. Agreement Regarding Dividends. Notwithstanding any other provision of this
Confirmation, the Equity Definitions or the Agreement to the contrary, in
calculating any adjustment pursuant to Article 11 of the Equity Definitions or
any amount payable in respect of any termination or cancellation of the
Transaction pursuant to Article 12 of the Equity Definitions or Section 6 of the
Agreement, the Calculation Agent shall not take into account changes to any
dividends since the Trade Date. For the avoidance of doubt, if an Early
Termination Date occurs in respect of the Transaction, the amount payable
pursuant to Section 6 of the Agreement in respect of such Early Termination Date
shall be determined without regard to the difference between actual dividends
declared (including Extraordinary Dividends) and expected dividends as of the
Trade Date.

19. GS&Co. Share Delivery Cap. Notwithstanding any other provision of this
Master Confirmation, any Supplemental Confirmation or the Agreement to the
contrary, in no event shall GS&Co be required to deliver to Counterparty in
connection with any Transaction a number of Shares that exceeds the GS&Co. Share
Delivery Cap set forth in the Supplemental Confirmation relating to such
Transaction.

20. Claim in Bankruptcy. GS&Co. acknowledges and agrees that this Confirmation
is not intended to convey to it rights with respect to the Transactions that are
senior to the claims of common stockholders in the event of Counterparty’s
bankruptcy.

 

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21. Governing Law. The Agreement, this Master Confirmation, each Supplemental
Confirmation and all matters arising in connection with the Agreement, this
Master Confirmation and each Supplemental Confirmation shall be governed by, and
construed and enforced in accordance with, the laws of the State of New York
(without reference to its choice of laws doctrine other than Title 14 of Article
5 of the New York General Obligations Law).

22. Illegality. The parties agree that, for the avoidance of doubt, for purposes
of Section 5(b)(i) of the Agreement, “any applicable law” shall include the
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, any rules and
regulations promulgated thereunder and any similar law or regulation, without
regard to Section 739 of the Dodd-Frank Wall Street Reform and Consumer
Protection Act of 2010 or any similar legal certainty provision in any
legislation enacted, or rule or regulation promulgated, on or after the Trade
Date, and the consequences specified in the Agreement, including without
limitation, the consequences specified in Section 6 of the Agreement, shall
apply to any Illegality arising from any such act, rule or regulation.

23. Offices.

(a) The Office of GS&Co. for each Transaction is: 200 West Street, New York, New
York 10282-2198.

(b) The Office of Counterparty for each Transaction is: 3333 Susan Street, Costa
Mesa, California 92626.

24. Submission to Jurisdiction. Section 13(b) of the Agreement is hereby deleted
in its entirety and replaced by the following:

“Each party hereby irrevocably and unconditionally submits for itself and its
property in any suit, legal action or proceeding relating to this Agreement
and/or any Transaction, or for recognition and enforcement of any judgment in
respect thereof, (each, “Proceedings”) to the exclusive jurisdiction of the
Supreme Court of the State of New York, sitting in New York Country, the courts
of the United States of America for the Southern District of New York and
appellate courts from any thereof. Nothing in the Master Confirmation or any
Supplemental Confirmation or this Agreement precludes either party from bringing
Proceedings in any other jurisdiction if (A) the courts of the State of New York
or the United States of America for the Southern District of New York lack
jurisdiction over the parties or the subject matter of the Proceedings or
declines to accept the Proceedings on the grounds of lacking such jurisdiction;
(B) the Proceedings are commenced by a party for the purpose of enforcing
against the other party’s property, assets or estate any decision or judgment
rendered by any court in which Proceedings may be brought as provided hereunder;
(C) the Proceedings are commenced to appeal any such court’s decision or
judgment to any higher court with competent appellate jurisdiction over that
court’s decisions or judgments if that higher court is located outside the State
of New York or Borough of Manhattan, such as a federal court of appeals or the
U.S. Supreme Court; or (D) any suit, action or proceeding has been commenced in
another jurisdiction by or against the other party or against its property,
assets or estate and, in order to exercise or protect its rights, interests or
remedies under this Agreement, the Master Confirmation or any Supplemental
Confirmation, the party (1) joints, files a claim, or takes any other action, in
any such suit, action or proceeding or (2) otherwise commences any Proceeding in
that other jurisdiction as the result of that other suit, action or proceeding
having commenced in that other jurisdiction.”

25. Waiver of Trial by Jury. EACH OF COUNTERPARTY AND GS& CO. HEREBY IRREVOCABLY
WAIVES (ON ITS OWN BEHALF AND, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ON
BEHALF OF ITS STOCKHOLDERS) ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING
OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO THE AGREEMENT, THIS MASTER CONFIRMATION, EACH SUPPLEMENTAL
CONFIRMATION AND EACH TRANSACTION OR THE ACTIONS OF GS&CO. OR ITS AFFILIATES IN
THE NEGOTIATION, PERFORMANCE OR ENFORCEMENT HEREOF.

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

 

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Counterparty hereby agrees (a) to check this Master Confirmation carefully and
immediately upon receipt so that errors or discrepancies can be promptly
identified and rectified and (b) to confirm that the foregoing (in the exact
form provided by GS&Co.) correctly sets forth the terms of the agreement between
GS&Co. and Counterparty with respect to any particular Transaction to which this
Master Confirmation relates, by manually signing this Master Confirmation or
this page hereof as evidence of agreement to such terms and providing the other
information requested herein.

 

Yours faithfully, GOLDMAN, SACHS & CO. By:  

/s/ Daniel Kopper

  Authorized Signatory

 

Agreed and Accepted By: EMULEX CORPORATION By:  

/s/ Jeffrey W. Benck

  Name:   Title:

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SCHEDULE A

SUPPLEMENTAL CONFIRMATION

 

To:   

Emulex Corporation

3333 Susan Street

Costa Mesa, California 92626

From:    Goldman, Sachs & Co. Subject:    Accelerated Stock Buyback Ref. No:   
[Insert Reference No.] Date:    [Insert Date]1

 

 

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

1. This Supplemental Confirmation supplements, forms part of, and is subject to
the Master Confirmation dated as of November 13, 2013 (the “Master
Confirmation”) between the Contracting Parties, as amended and supplemented from
time to time. All provisions contained in the Master Confirmation govern this
Supplemental Confirmation except as expressly modified below.

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

 

Trade Date:    [                    ]2 Forward Price Adjustment Amount:    [An
amount equal to the product of (i) the Forward Price Percentage and (ii) the
closing price per Share, as published by Bloomberg on page “ELX.N <Equity>HP”
(or any successor thereto), on the Prepayment Date for such Transaction (the
“Closing Price Per Share”).]

Forward Price Percentage:

 

Calculation Period Start Date:

  

[    ]%

 

[The first Scheduled Trading Day immediately following the Prepayment Date]3

Scheduled Termination Date:    [                    ] First Acceleration Date:
   [                    ] Prepayment Amount:    USD [            ]

 

1  For the initial Transaction, to be: November 13, 2013.

2  For the initial Transaction, to be: November 13, 2013.

3  For the initial Transaction, to be: November 19, 2013.

 

A-1

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Prepayment Date:    [The “closing date” with respect to the sale by Counterparty
of the USD 175,000,000 principal amount of 1.75% Convertible Senior Notes due
2018 (the “Convertible Notes Offering”) determined in accordance with the
Purchase Agreement, dated as of November 12, 2018, between the Initial Purchaser
(as defined therein) and Counterparty (the “Purchase Agreement”).]4 Initial
Share Delivery Date:    [The first Scheduled Trading Day immediately following
the Prepayment Date]5 [Initial Share Delivery Percentage: ]    [    ]%6] Initial
Shares:    An amount equal to the product of (i)(A) the Prepayment Amount for
such Transaction, divided by (B) the Closing Price Per Share, and (ii) the
Initial Delivery Percentage for such Transaction; provided that, if in
connection with the Transaction GS&Co. is unable after using good faith and
commercially reasonable efforts to borrow or otherwise acquire a number of
Shares equal to the Initial Shares for delivery to Counterparty on the Initial
Share Delivery Date, the Initial Shares delivered on the Initial Share Delivery
Date shall be reduced to such number of Shares that GS&Co. is able to so borrow
or otherwise acquire, and thereafter GS&Co. shall continue to use commercially
reasonable efforts to borrow or otherwise acquire a number of Shares, at a stock
borrow cost no greater than the Initial Stock Loan Rate, equal to the shortfall
in such Initial Share Delivery and to deliver such additional Shares as soon as
reasonably practicable and in no event later than the fifth Exchange Business
Day following the Initial Share Delivery Date, but only to the extent such
delivery of additional Shares would not cause a Hedging Disruption, an Increased
Cost of Hedging, a Loss of Stock Borrow or an Increased Cost of Stock Borrow to
occur (it being understood, for the avoidance of doubt, that in using such
commercially reasonable efforts GS&Co. shall act in good faith and in accordance
with its then current policies, practices and procedures (including without
limitation any policies, practices or procedures relating to counterparty risk,
market risk, reputational risk, credit, documentation, legal, regulatory
capital, compliance and collateral), and shall not be required to enter into any
securities lending transaction or transact with any potential securities lender
if such transaction would not be in accordance with such policies, practices and
procedures). GS&Co. Share Delivery Cap:    [                ]7 Shares
Termination Price:    USD 4 per Share Additional Relevant Days:    The 10
Exchange Business Days immediately following the Calculation Period.

 

4  For the initial Transaction, to be: November 18, 2013.

5  For the initial Transaction, to be: November 19, 2013.

6  For the initial Transaction, to be: 80%.

7  For the initial Transaction, to be: 25,740,026.

 

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

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

 

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Counterparty hereby agrees (a) to check this Supplemental Confirmation carefully
and immediately upon receipt so that errors or discrepancies can be promptly
identified and rectified and (b) to confirm that the foregoing (in the exact
form provided by GS&Co.) correctly sets forth the terms of the agreement between
GS&Co. and Counterparty with respect to the Transaction to which this
Supplemental Confirmation relates, by manually signing this Supplemental
Confirmation or this page hereof as evidence of agreement to such terms and
providing the other information requested herein.

 

Yours sincerely, GOLDMAN, SACHS & CO. By:  

 

  Authorized Signatory

 

Agreed and Accepted By: EMULEX CORPORATION By:  

 

  Name:   Title:

 

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ANNEX A

COUNTERPARTY SETTLEMENT PROVISIONS

1. The following Counterparty Settlement Provisions shall apply to the extent
indicated under the Master Confirmation:

 

Settlement Currency:    USD Settlement Method Election:    Applicable; provided
that (i) Section 7.1 of the Equity Definitions is hereby amended by deleting the
word “Physical” in the sixth line thereof and replacing it with the words “Net
Share” and (ii) the Electing Party may make a settlement method election only if
the Electing Party represents and warrants to GS&Co. in writing on the date it
notifies GS&Co. of its election that, as of such date, the Electing Party is not
aware of any material non-public information concerning Counterparty or the
Shares and is electing the settlement method in good faith and not as part of a
plan or scheme to evade compliance with the federal securities laws. Electing
Party:    Counterparty Settlement Method Election Date:   

 

The earlier of (i) the Scheduled Termination Date and (ii) the second Exchange
Business Day immediately following the Accelerated Termination Date (in which
case the election under Section 7.1 of the Equity Definitions shall be made no
later than 10 minutes prior to the open of trading on the Exchange on such
second Exchange Business Day), as the case may be.

Default Settlement Method:    Cash Settlement Forward Cash Settlement Amount:   

 

The Number of Shares to be Delivered multiplied by the Settlement Price.

Settlement Price:    The average of the VWAP Prices for the Exchange Business
Days in the Settlement Valuation Period, subject to Valuation Disruption as
specified in the Master Confirmation. Settlement Valuation Period:    A number
of Scheduled Trading Days selected by GS&Co. in its commercially reasonable
discretion, based on the number of Trading Days that is required to unwind a
commercially reasonable hedge position, taking into account market conditions at
the time (including, but not limited to, liquidity), beginning on the Scheduled
Trading Day immediately following the earlier of (i) the Scheduled Termination
Date or (ii) the Exchange Business Day immediately following the Termination
Date.

 

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Cash Settlement:    If Cash Settlement is applicable, then Buyer shall pay to
Seller the absolute value of the Forward Cash Settlement Amount on the Cash
Settlement Payment Date. Cash Settlement Payment Date:   

 

The date one Settlement Cycle following the last day of the Settlement Valuation
Period.

Net Share Settlement Procedures:   

 

If Net Share Settlement is applicable, Net Share Settlement shall be made in
accordance with paragraphs 2 through 7 below.

2. Net Share Settlement shall be made by delivery on the Cash Settlement Payment
Date of a number of Shares satisfying the conditions set forth in paragraph 3
below (the “Registered Settlement Shares”), or a number of Shares not satisfying
such conditions (the “Unregistered Settlement Shares”), in either case with a
value equal to the absolute value of the Forward Cash Settlement Amount, with
such Shares’ value determined by the Calculation Agent in a commercially
reasonable manner (which value shall, in the case of Unregistered Settlement
Shares, take into account a commercially reasonable illiquidity discount), in
each case as determined by the Calculation Agent.

3. Counterparty may only deliver Registered Settlement Shares pursuant to
paragraph 2 above if:

(a) a registration statement covering public resale of the Registered Settlement
Shares by GS&Co. (the “Registration Statement”) shall have been filed with the
Securities and Exchange Commission under the Securities Act and been declared or
otherwise become effective on or prior to the date of delivery, and no stop
order shall be in effect with respect to the Registration Statement; a printed
prospectus relating to the Registered Settlement Shares (including any
prospectus supplement thereto, the “Prospectus”) shall have been delivered to
GS&Co., in such quantities as GS&Co. shall reasonably have requested, on or
prior to the date of delivery;

(b) the form and content of the Registration Statement and the Prospectus
(including, without limitation, any sections describing the plan of
distribution) shall be satisfactory to GS&Co.;

(c) as of or prior to the date of delivery, GS&Co. and its agents shall have
been afforded a reasonable opportunity to conduct a due diligence investigation
with respect to Counterparty customary in scope for underwritten offerings of
equity securities and the results of such investigation are satisfactory to
GS&Co., in its discretion; and

(d) as of the date of delivery, an agreement (the “Underwriting Agreement”)
shall have been entered into with GS&Co. in connection with the public resale of
the Registered Settlement Shares by GS&Co. substantially similar to underwriting
agreements customary for underwritten offerings of equity securities of a
similar size by companies similar to Counterparty, in form and substance
commercially reasonably satisfactory to GS&Co., which Underwriting Agreement
shall include, without limitation, provisions substantially similar to those
contained in such underwriting agreements relating, without limitation, to the
indemnification of, and contribution in connection with the liability of, GS&Co.
and its affiliates and the provision of customary opinions, accountants’ comfort
letters and lawyers’ negative assurance letters.

 

2

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4. If Counterparty delivers Unregistered Settlement Shares pursuant to paragraph
2 above:

(a) all Unregistered Settlement Shares shall be delivered to GS&Co. (or any
affiliate of GS&Co. designated by GS&Co.) pursuant to the exemption from the
registration requirements of the Securities Act provided by Section 4(2)
thereof;

(b) as of or prior to the date of delivery, GS&Co. and any potential purchaser
of any such shares from GS&Co. (or any affiliate of GS&Co. designated by GS&Co.)
identified by GS&Co. shall be afforded a commercially reasonable opportunity to
conduct a due diligence investigation with respect to Counterparty customary in
scope for private placements of equity securities of a similar size by companies
similar to Counterparty (including, without limitation, the right to have made
available to them for inspection all financial and other records, pertinent
corporate documents and other information reasonably requested by them);

(c) as of the date of delivery, Counterparty shall enter into an agreement (a
“Private Placement Agreement”) with GS&Co. (or any affiliate of GS&Co.
designated by GS&Co.) in connection with the private placement of such shares by
Counterparty to GS&Co. (or any such affiliate) and the private resale of such
shares by GS&Co. (or any such affiliate), substantially similar to private
placement purchase agreements customary for private placements of equity
securities of a similar size by companies similar to Counterparty, in form and
substance commercially reasonably satisfactory to GS&Co., which Private
Placement Agreement shall include, without limitation, provisions substantially
similar to those contained in such private placement purchase agreements
relating, without limitation, to the indemnification of, and contribution in
connection with the liability of, GS&Co. and its affiliates and provide for
Counterparty using best efforts to deliver documentation appropriate for a
private placement of similar size, and shall provide for the payment by
Counterparty of all commercially reasonable fees and expenses in connection with
such resale, including all commercially reasonable fees and expenses of counsel
for GS&Co., and shall contain representations, warranties, covenants and
agreements of Counterparty reasonably necessary or advisable to establish and
maintain the availability of an exemption from the registration requirements of
the Securities Act for such resales; and

(d) in connection with the private placement of such shares by Counterparty to
GS&Co. (or any such affiliate) and the private resale of such shares by GS&Co.
(or any such affiliate), Counterparty shall, if so requested by GS&Co., prepare,
in cooperation with GS&Co., a private placement memorandum in form and substance
commercially reasonably satisfactory to GS&Co and customary for private
placements of equity securities of similar size by companies similar to
Counterparty.

5. GS&Co., itself or through an affiliate (the “Selling Agent”) or any
underwriter(s), will sell, in a commercially reasonable manner and over a
commercially reasonable period, all, or such lesser portion as may be required
hereunder, of the Registered Settlement Shares or Unregistered Settlement Shares
and any Makewhole Shares (as defined below) (together, the “Settlement Shares”)
delivered by Counterparty to GS&Co. pursuant to paragraph 6 below in a
commercially reasonable manner commencing on the Cash Settlement Payment Date
and continuing until the date on which the aggregate Net Proceeds (as such term
is defined below) of such sales, as determined by GS&Co. in a commercially
reasonable manner, is equal to the absolute value of the Forward Cash Settlement
Amount (such date, the “Final Resale Date”). If the proceeds of any sale(s) made
by GS&Co., the Selling Agent or any underwriter(s), net of any commercially
reasonable fees and commissions (including, without limitation, commercially
reasonable underwriting or placement fees) customary for similar transactions of
a similar size under the circumstances at the time of the offering, together
with commercially reasonable carrying charges and expenses incurred in
connection with the offer and sale of the Shares (including, but without
limitation to, the covering of any over-allotment or short position (syndicate
or otherwise)) (the “Net Proceeds”) exceed the absolute value of the Forward
Cash Settlement Amount, GS&Co. will refund, in USD or in additional Shares, at
Counterparty’s election, such excess to Counterparty on the date that is three
(3) Currency Business Days following the Final Resale Date, and, if any portion
of the Settlement Shares remains unsold, GS&Co. shall return to Counterparty on
that date such unsold Shares.

6. If the Calculation Agent determines that the Net Proceeds received from the
sale of the Registered Settlement Shares or Unregistered Settlement Shares or
any Makewhole Shares, if any, pursuant to this paragraph 6 are less than the
absolute value of the Forward Cash Settlement Amount (the amount in USD by which
the Net Proceeds are less than the absolute value of the Forward Cash Settlement
Amount being the “Shortfall” and

 

3

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the date on which such determination is made, the “Deficiency Determination
Date”), Counterparty shall on the Exchange Business Day next succeeding the
Deficiency Determination Date (the “Makewhole Notice Date”) deliver to GS&Co.,
through the Selling Agent, a notice of Counterparty’s election that Counterparty
shall either (i) pay an amount in cash equal to the Shortfall on the day that is
one (1) Currency Business Day after the Makewhole Notice Date, or (ii) deliver
additional Shares. If Counterparty elects to deliver to GS&Co. additional
Shares, then Counterparty shall deliver additional Shares in compliance with the
terms and conditions of paragraph 3 or paragraph 4 above, as the case may be
(the “Makewhole Shares”), on the first Clearance System Business Day which is
also an Exchange Business Day following the Makewhole Notice Date in such number
as the Calculation Agent reasonably believes would have a market value on that
Exchange Business Day equal to the Shortfall. Such Makewhole Shares shall be
sold by GS&Co. in accordance with the provisions above; provided that if the sum
of the Net Proceeds from the sale of the originally delivered Shares and the Net
Proceeds from the sale of any Makewhole Shares is less than the absolute value
of the Forward Cash Settlement Amount then Counterparty shall, at its election,
either make such cash payment or deliver to GS&Co. further Makewhole Shares
until such Shortfall has been reduced to zero.

7. Notwithstanding the foregoing, in no event shall the aggregate number of
Settlement Shares and Makewhole Shares be greater than the Reserved Shares minus
the amount of any Shares actually delivered by Counterparty under any other
Transaction(s) under this Master Confirmation (the result of such calculation,
the “Capped Number”). Counterparty represents and warrants (which shall be
deemed to be repeated on each day that a Transaction is outstanding) that the
Capped Number is equal to or less than the number of Shares determined according
to the following formula:

A – B

 

  Where A = the number of authorized but unissued shares of the Counterparty
that are not reserved for future issuance on the date of the determination of
the Capped Number; and

B = the maximum number of Shares required to be delivered to third parties if
Counterparty elected Net Share Settlement of all transactions in the Shares
(other than Transactions in the Shares under this Master Confirmation) with all
third parties that are then currently outstanding and unexercised.

“Reserved Shares” means initially, 25,740,026 Shares. The Reserved Shares may be
increased or decreased in a Supplemental Confirmation.

 

4