exv10w1






Exhibit 10.1


EXECUTION
COPY




SHARE LENDING AGREEMENT




Dated as of June 18, 2008




Among




ENERGY CONVERSION DEVICES, INC. (“Lender”),




and




CREDIT SUISSE INTERNATIONAL (“Borrower”), through CREDIT SUISSE SECURITIES

(USA) LLC, as agent for Borrower (“Borrowing Agent”).




and




     CREDIT SUISSE SECURITIES (USA) LLC, in its capacity as Collateral Agent (as hereinafter
defined). This Agreement sets forth the terms and conditions under which Borrower may borrow from
Lender shares of Common Stock.



     The parties hereto agree as follows:



     Section 1. Certain Definitions.  The following capitalized terms shall have the
following meanings:



     “Affiliate” has the meaning within Section 203 of the Delaware General Corporation
Law.



     “Beneficial Ownership” has the meaning within Section 13 of the Exchange Act and the
rules promulgated thereunder.



     “Business Day” means, with respect to any Loan hereunder, a day on which regular
trading occurs in the principal trading market for the Common Stock.



     “Cash” means any coin or currency of the United States as at the time shall be legal
tender for payment of public and private debts.



     “Clearing Organization” means The Depository Trust Company, or, if agreed to by
Borrower and Lender, such other securities intermediary at which Borrower (or Borrowing Agent) and
Lender maintain accounts.



     “Closing Price” on any day means, with respect to the Common Stock (i) if the Common
Stock is listed or admitted to trading on a U.S. securities exchange registered under the Exchange
Act or is included in the OTC Bulletin Board Service (operated by the National Association of
Securities Dealers, Inc.), the last reported sale price, regular way, in the principal trading
session on such day on such market on which the Common Stock is then listed or is admitted to
trading



 









 




(or, if the day of determination is not a Business Day, the last preceding Business Day) and
(ii) if the Common Stock is not so listed or admitted to trading or if the last reported sale price
is not obtainable (even if the Common Stock is listed or admitted to trading on such market), the
average of the bid prices for the Common Stock obtained from as many dealers in the Common Stock
(which may include Borrower or its Affiliates), but not exceeding three, as shall furnish bid
prices available to the Lender.




     “Collateral” means any Cash or Non-Cash Collateral.  Each of the parties to this
Agreement hereby agrees that Cash and each item within the definition of Non-Cash Collateral shall
be treated as a “financial asset” as defined by Section 8-102(a)(9) of the UCC.



     “Collateral Account” means the securities account of the Collateral Agent maintained
on the books of Credit Suisse Securities (USA) LLC, as securities intermediary, and designated
“Credit Suisse Securities (USA) LLC, as Collateral Agent of Lender, as pledgee of Credit Suisse
International, as Borrower of Loaned Shares.”  Any Collateral deposited in the Collateral Account
shall be segregated from all other assets and property of the Collateral Agent, which segregation
may be accomplished by appropriate identification on the books and records of the Collateral Agent,
as a “securities intermediary” within the meaning of the UCC. The securities intermediary
acknowledges that the Collateral Account is maintained for the Collateral Agent and undertakes to
treat the Collateral Agent as entitled to exercise the rights that comprise the Collateral credited
to the Collateral Account. For purposes of UCC Section 9-301(2), the Collateral Account and the
Collateral will reside in New York, New York.



     “Collateral Agent” means Credit Suisse Securities (USA) LLC, in its capacity as
collateral agent for Lender hereunder, or any successor thereto under Section 20.



     “Collateral Percentage” means 100%.



     “Common Stock” means shares of Common Stock, par value $0.01 per share, of Lender, or
any other security into which the Common Stock shall be exchanged or converted as the result of any
merger, consolidation, other business combination, reorganization, reclassification,
recapitalization or other corporate action (including, without limitation, a reorganization in
bankruptcy), in each case not involving an Unaffiliated Third Party.



     “Convertible Notes” means the $275,000,000 aggregate principal amount of 3.0% Senior
Convertible Notes due 2013 issued by Lender, or up to $316,250,000 aggregate principal amount to
the extent the option to purchase additional 3.0% Senior Convertible Notes due 2013 is exercised in
full as set forth in the underwriting agreement relating to the initial purchase of the Convertible
Notes.



     “Credit Downgrade” occurs when the Borrower receives a rating for its long term,
unsecured and unsubordinated indebtedness that is below A- by Standard and Poor’s Ratings Group, or
its successor (“S&P”), or below A3 by Moody’s Investors Service, Inc., or its successor
(“Moody’s”), or, if either S&P or Moody’s ceases to rate such debt, an equivalent or lower
rating by a substitute rating agency mutually agreed upon by the Lender and the Borrower.



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     “Credit Upgrade” occurs when the Borrower receives a rating for its long term,
unsecured and unsubordinated indebtedness that is A- or better by S&P or A3 or better by Moody’s,
or, if either S&P or Moody’s ceases to rate such debt, an equivalent or higher rating by a
substitute rating agency mutually agreed upon by the Lender and the Borrower.



     “Cutoff Time” shall mean 10:00 a.m. in the jurisdiction of the Clearing Organization,
or such other time on a Business Day by which a transfer of Loaned Shares must be made by Borrower
or Lender to the other, as shall be determined in accordance with market practice.



     “Exchange Act” means the Securities Exchange Act of 1934, as amended.



     “Indenture” means the Indenture dated as of June 24, 2008, between the Lender and The
Bank of New York Trust Company, N.A., as trustee, as supplemented by the first supplemental
indenture to be dated as of June 24, 2008, pursuant to which the Convertible Notes will be issued
(the “First Supplemental Indenture”).



     “Interested Stockholder” has the meaning as set forth in Section 203 of the Delaware
General Corporation Law.



     “Loan Availability Period” means the period beginning with the date of issuance of the
Convertible Notes and ending on the earliest of (i) June 15, 2013, (ii) the date as of which the
Lender has notified the Borrower in writing of its intention to terminate this Agreement at any
time after the latest of (y) the date on which the entire principal amount of the Convertible Notes
ceases to be outstanding and (z) the date on which the entire principal amount of any additional
convertible securities of the Lender which the Lender has in writing consented to permit the
Borrower to hedge under this Agreement ceases to be outstanding, in each case, whether as a result
of conversion, redemption, repurchase, cancellation or otherwise and (iii) the date on which this
Agreement shall terminate in accordance with the terms of this Agreement.



     “Loaned Shares” means shares of Common Stock initially transferred to the Borrower in
a Loan hereunder until such Loan or portion thereof is terminated and a corresponding number of
Loaned Shares is transferred to Lender pursuant to this Agreement; provided that in respect of any
such shares of Common Stock initially transferred to the Borrower by Lender and subsequently
transferred by the Borrower to another transferee, “Loaned Shares” means an equivalent number of
shares of identical Common Stock.  If, as the result of a stock dividend, stock split or reverse
stock split, the number of outstanding shares of Common Stock is increased or decreased, then the
number of outstanding Loaned Shares shall be proportionately increased or decreased, as the case
may be.  If any new or different security (or two or more securities) shall be exchanged for the
outstanding shares of Common Stock as the result of any reorganization, merger, consolidation,
reclassification, recapitalization or other corporate action (including, without limitation, a
reorganization in bankruptcy) not involving an Unaffiliated Third Party, such new or different
security (or such two or more securities collectively) shall, effective upon such exchange, be
deemed to become a Loaned Share in substitution for the former Loaned Share for which such exchange
is made.



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     “Market Value” on any day means (i) with respect to Common Stock, the most recent
Closing Price of the Common Stock prior to such day and (ii) with respect to any Collateral that is
(a) Cash, the face amount thereof, (b) a letter of credit, the undrawn amount thereof and (c) any
other security or property, the market value thereof, as determined by the Collateral Agent, in
accordance with market practice for such securities or property, based on the price for such
security or property as of the most recent close of trading obtained from a generally recognized
source or the closing bid quotation at the most recent close of trading obtained from such source,
plus accrued interest to the extent not included therein, unless market practice with respect to
the valuation of such securities or property in connection is to the contrary.



     “Maximum Number of Shares” means 3,444,975 shares of Common Stock, subject to the
following adjustments:



     (a) If, as the result of any change in nominal value or par value, or any stock dividend,
stock split or reverse stock split, the number of outstanding shares of Common Stock is increased
or decreased, the Maximum Number of Shares shall, effective as of the payment or delivery date of
any such event, be proportionally increased or decreased, as the case may be.



     (b) If, pursuant to a merger, consolidation, other business combination, reorganization,
reclassification, recapitalization or other corporate action (including, without limitation, a
reorganization in bankruptcy) involving an Unaffiliated Third Party, the Common Stock is exchanged
for or converted into cash, securities or other property, the Maximum Number of Shares shall be
reduced to zero on the effective date of such event.



     (c) Upon the termination of any Loan pursuant to Section 5(a), the Maximum Number of Shares
shall be reduced by the number of Loaned Shares surrendered by Borrower to Lender.



     (d) Notwithstanding the foregoing, in no event shall the Maximum Number of Shares at any time
exceed the sum of (y) the product of (i) the aggregate principal amount of Convertible Notes
outstanding at such time, divided by $1,000 and (ii) the Conversion Rate (as defined in the
First Supplemental Indenture) of the Convertible Notes plus (z) the product of (i) the
aggregate principal amount outstanding at such time of any additional convertible securities of the
Lender which the Lender has in writing consented to permit the Borrower to hedge under this
Agreement, divided by $1,000 and (ii) the conversion rate (as defined in an indenture or a
supplemental indenture relating to such additional convertible securities) of such additional
convertible securities.



     “Non-Cash Collateral” means (i) any evidence of indebtedness issued, or directly and
fully guaranteed or insured, by the United States of America or any agency or instrumentality
thereof; (ii) any deposits, certificates of deposit or acceptances of any institution which is a
member of the Federal Reserve System having combined capital and surplus and undivided profits of
not less than $500 million at the time of deposit (and which may include the Collateral Agent or
any Affiliate of the Collateral Agent so long as the Collateral Agent is other than Borrower or an
Affiliate of Borrower); (iii) any investments of any Person that is fully and unconditionally
guaranteed by a bank referred to in clause (ii); (iv) any repurchase agreements



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and reverse repurchase agreements relating to marketable direct obligations issued or
unconditionally guaranteed by the United States of America or issued by any agency thereof and
backed as to timely payment by the full faith and credit of the United States of America;
(v) commercial paper of any corporation incorporated under the laws of the United States or any
State thereof that is rated “investment grade” A-1 by Standard & Poor’s Rating Group, a division of
McGraw Hill Inc., or any successor thereto, or P-1 by Moody’s Investors Services, Inc., or any
successor thereto; (vi) any money market funds (including, but not limited to, money market funds
managed by the Collateral Agent or an Affiliate of the Collateral Agent) registered under the
Investment Company Act of 1940, as amended; (vii) any letter of credit issued by a bank referred to
in clause (ii); and (viii) all proceeds of the foregoing; provided that in no event shall Non-Cash
Collateral include “margin stock” as defined by Regulation U of the Board of Governors of the
Federal Reserve System.



     “Pledge Date” has the meaning set forth in Section 3(a).



     “Pledge Period” means any period beginning on a Pledge Date and, to the extent such
Pledge Date occurred as a result of a Credit Downgrade, ending on the earlier of (i) the Business
Day immediately following the day on which Borrower notifies Lender and Collateral Agent that a
Credit Upgrade has occurred and (ii) the date on which this Agreement shall terminate in accordance
with the terms of this Agreement.



     “UCC” means the Uniform Commercial Code as in effect in the State of New York on the
date hereof and as it may be amended from time to time.



     “Unaffiliated Third Party” shall mean, with respect to any transaction by the Lender,
any person that the Lender does not “control” (as that term is defined by Rule 12b-2 under the
Exchange Act) immediately prior to the transaction.



     Section 2. Loans of Shares; Transfers of Loaned Shares.



     (a) Subject to the terms and conditions of this Agreement, Lender hereby agrees to make
available for borrowing by Borrower during the Loan Availability Period, shares of Common Stock up
to, in the aggregate, the Maximum Number of Shares.



     (b) Subject to the terms and conditions of this Agreement, Borrower may, by written notice to
Lender delivered on or before July 8, 2008 (a “Borrowing Notice”), seek to initiate a
transaction in which Lender will lend Loaned Shares to Borrower through the issuance by Lender of
such Loaned Shares to Borrower upon the terms, and subject to the conditions, set forth in this
Agreement (each such issuance and loan, a “Loan”).  Such Loan shall be confirmed by a
schedule and receipt listing the Loaned Shares provided by Lender to Borrower (the
“Confirmation”).  Such Confirmation shall constitute conclusive evidence with respect to
the Loan, including the number of shares of Common Stock that are the subject of the Loan, to which
the Confirmation relates, unless a written objection to the Confirmation specifying the reasons for
the objection is received by Lender within five Business Days after the delivery of the
Confirmation to Borrower; provided that in no event shall the delivery of the Confirmation or



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any such objection thereto delay the transfer of Loaned Shares to which a Borrowing Notice
relates pursuant to clause (d) below.



     (c) Notwithstanding anything to the contrary in this Agreement, Borrower shall not be
permitted to borrow, and may not initiate a Loan hereunder with respect to, any shares of Common
Stock at any time to the extent that Borrower determines (i) that any Loan of such shares of Common
Stock shall cause Borrower or any Affiliate of Borrower subject to aggregation with Borrower under
Section 13 of the Exchange Act and the rules promulgated thereunder or any “group” (within the
meaning of such Section 13 and rules) of which Borrower is a member (collectively, “Borrower
Group”) to directly or indirectly have Beneficial Ownership of more than 9.0% of the shares of
Common Stock outstanding at such time or (ii) Borrower or any Affiliate of Borrower, would be an
Interested Stockholder of Lender. If any delivery owed to Borrower hereunder is not made, in whole
or in part, as a result of this provision, Lender’s obligation to make such delivery shall not be
extinguished during the Loan Availability Period and Lender shall make such delivery as promptly as
practicable after, but in no event later than one Business Day after, Borrower gives notice to
Lender that such delivery would not (i) result in Borrower Group directly or indirectly having
Beneficial Ownership of more than 9.0% of the shares of Common Stock outstanding at such time or
(ii) result in Borrower or any Affiliate of Borrower becoming an Interested Stockholder of Lender.
Under no circumstances shall Lender be liable to Borrower for any Loan in contravention of this
Section 2(c).



     (d) Lender shall transfer Loaned Shares to Borrower on or before the Cutoff Time on the date
specified in the related Borrowing Notice provided that no Loans will be made after July 8, 2008.
Delivery of the Loaned Shares to Borrower shall be made in the manner set forth under Section 13
below.



     Section 3. Collateral. 



     (a) Unless otherwise agreed by Borrower and Lender, Borrower shall, no later than 10:00 a.m.
New York time on the second Business Day immediately following any day on which a Credit Downgrade
has occurred, transfer to Collateral Agent, for deposit to the Collateral Account, Collateral with
a Market Value at least equal to the Collateral Percentage of the Market Value of the Loaned Shares
as of the close of business on the Business Day immediately preceding such transfer (any such date,
a “Pledge Date”).



     (b) During any Pledge Period, any Collateral transferred by Borrower to Collateral Agent shall
be security for Borrower’s obligations in respect of the Loaned Shares and for any other
obligations of Borrower to Lender hereunder.  Borrower on the Pledge Date pledges with, assigns to,
and grants Collateral Agent for the benefit of Lender a continuing first priority security interest
in, and a lien upon, the Collateral, which shall attach upon the transfer of the Loaned Shares by
Lender to Borrower and which shall cease upon the transfer of the Loaned Shares by Borrower to
Lender, a Credit Upgrade or upon the transfer of such Collateral to Borrower in accordance with the
terms of this Agreement.  In addition to the rights and remedies given to Lender hereunder, Lender
shall have all the rights and remedies of a secured party under



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the UCC.  To provide for the effectiveness, validity, perfection and priority of Lender’s
rights as a secured party, Borrower acknowledges that Collateral Agent has obtained control of any
financial assets included in the Collateral (or shall have obtained control upon posting of such
Collateral pursuant to the terms contained herein) within the meaning of Sections 8-106 and 9-106
of the UCC.  Collateral Agent acknowledges that it has control of the Collateral (or shall have
control upon posting of such collateral pursuant to the terms contained herein) on behalf of Lender
within the meaning of Section 8-106(d)(1) of the UCC.  Notwithstanding anything to the contrary
herein, Lender may not use or invest the Collateral and Collateral Agent shall take no instruction
from Lender regarding the use or investment of Collateral.  Promptly upon the termination of any
Pledge Period, the Collateral Agent shall release to the Borrower all of the Collateral.



     (c) The Borrower further agrees that if so requested by the Collateral Agent at any time, to
promptly execute all documents (including any security agreements and transfers) and do all things
(including the delivery, transfer, assignment or payment of all or part of the Collateral to the
Collateral Agent or its nominee(s)) that the Collateral Agent may reasonably specify for the
purpose of (a) exercising the rights to the Collateral or (b) securing and perfecting its security
over or title to all or any part of the Collateral (including transferring the Collateral into the
name of the Collateral Agent or its nominee(s)).



     (d) Except as otherwise provided herein, upon the transfer to Lender of Loaned Shares pursuant
to Section 6, Collateral Agent shall release to Borrower Collateral with a Market Value equal to
the Collateral Percentage of the Market Value of the Loaned Shares so transferred but only to the
extent that immediately following such transfer of Collateral, no Collateral Deficit would exist. 
Such transfer of Collateral shall be made no later than the Cutoff Time on the day the Loaned
Shares are transferred, or if such day is not a day on which a transfer of such Collateral may be
effected under Section 13, or if the transfer of Loaned Shares by Lender to Borrower occurs after
the Cutoff Time on such day, then in each case the next day on which such a transfer may be
effected.



     (e) If Borrower transfers Collateral to Collateral Agent, as provided in this Section 3, and
Lender does not transfer (or has not transferred) the Loaned Shares to Borrower, Borrower shall
have the absolute right to the return of the Collateral; and if Lender transfers Loaned Shares to
Borrower and Borrower does not transfer Collateral to Collateral Agent as provided in this
Section 3, Lender shall have the absolute right to the return of the Loaned Shares.



     (f) Borrower may, upon notice to Lender and Collateral Agent, substitute Collateral for
Collateral securing any Loan or Loans; provided that such substituted Collateral shall have a
Market Value such that the aggregate Market Value of such substituted Collateral, together with all
other Collateral, shall equal or exceed the Collateral Percentage of the Market Value of the Loaned
Shares as of the date of such substitution.




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     Section 4. Mark to Market.



     (a) During any Pledge Period, if at the close of trading on any Business Day during the Loan
Availability Period the aggregate Market Value of all Collateral shall be less than the Collateral
Percentage of the Market Value of all the outstanding Loaned Shares (a “Collateral
Deficit”), Lender may, by notice to Borrower and Collateral Agent, demand that Borrower
transfer to Collateral Agent, for deposit to the Collateral Account, no later than the following
Business Day, additional Collateral so that the Market Value of such additional Collateral, when
added to the Market Value of all other Collateral, shall equal or exceed the Collateral Percentage
of the Market Value of the Loaned Shares on such Business Day of determination.



     (b) During any Pledge Period, if at the close of trading on any Business Day during the Loan
Availability Period the aggregate Market Value of all Collateral shall be greater than the
Collateral Percentage of the Market Value of all the outstanding Loaned Shares (a “Collateral
Excess”), Borrower may, by notice to Lender and Collateral Agent, demand that Collateral Agent
transfer to Borrower such amount of the Collateral selected by Borrower so that the Market Value of
the Collateral, after deduction of such amounts, shall thereupon be at least equal to the
Collateral Percentage of the Market Value of the Loaned Shares on such Business Day of
determination; provided however that with respect to clauses (a) and (b), the Collateral Agent will
promptly give Lender a statement setting forth the Market Value of all Collateral upon Lender’s
request and Lender shall have the right to audit the Market Value of all Collateral.



     (c) Notwithstanding the foregoing, with respect to any outstanding Loans secured by
Collateral, the respective rights of Lender and Borrower under Section 4(a) and Section 4(b) may be
exercised only where a Collateral Excess or Collateral Deficit exceeds 5% of the Market Value of
the Loaned Shares.



     Section 5. Loan Fee.  Borrower agrees to pay Lender a single loan fee per Loan (a
“Loan Fee”) equal to $0.01 per Loaned Share.  The Loan Fee shall be paid by Borrower on or
before the time of a transfer of the Loaned Shares pursuant to Section 2(d) on a
delivery-versus-payment basis through the facilities of the Clearing Organization.



     Section 6. Loan Terminations.



     (a) Borrower may terminate all or any portion of a Loan on any Business Day by giving written
notice thereof to Lender and transferring the corresponding number of Loaned Shares to Lender,
without any consideration being payable in respect thereof by Lender to Borrower.



     (b) All outstanding Loans, if any, on the last day of the Loan Availability Period shall
terminate on the first Business Day following the last day of the Loan Availability Period (the
“Facility Termination Date”) and all outstanding Loaned Shares shall be delivered by
Borrower to Lender, without any consideration being payable in respect thereof by Lender to
Borrower, no later than the fifth Business Day following the Facility Termination Date.



     (c) If on any date, the number of Loaned Shares exceeds the Maximum Number of Shares, the
number of Loaned Shares in excess of the Maximum Number of Shares shall be delivered by Borrower to
Lender, without any consideration being payable in respect thereof by



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Lender to Borrower, no later than the third Business Day following such date (the “Delivery
Due Date”). If as a result of complying with this Section 6(c), Borrower Group would become a
Beneficial Owner of more than 9.0% of the shares of Common Stock outstanding at such time, or an
Interested Stockholder of Lender, then Borrower shall be permitted to extend the Delivery Due Date
for all or a portion of the corresponding delivery obligation and in no event no longer than such
time to allow Borrower to return, as promptly as reasonably practicable (but subject to applicable
law, regulation or policy), such Loaned Shares, through one transaction or a series of
transactions, without causing Borrower Group to become, directly or indirectly a Beneficial Owner
of more than 9.0% of the shares of Common Stock outstanding at such time, or an Interested
Stockholder of Lender.



     (d) If a Loan is terminated upon the occurrence of a Default as set forth in Section 11, the
Loaned Shares shall be delivered by Borrower to Lender, without any consideration being payable in
respect thereof by Lender to Borrower, no later than the third Business Day following the
termination date of such Loan as provided in Section 11.



     Section 7. Distributions.



     (a) If at any time when there are Loaned Shares outstanding under this Agreement, Lender pays
a cash dividend or makes a cash distribution in respect of all of its outstanding Common Stock,
Borrower shall pay to Lender (whether or not Borrower is a holder of any or all of the outstanding
Loaned Shares), within one Business Day after the payment of such dividend or distribution, an
amount in cash equal to the product of (i) the amount per share of such dividend or distribution
and (ii) the number of Loaned Shares outstanding on the record date for such dividend or
distribution.



     (b) If at any time when there are Loaned Shares outstanding under this Agreement, Lender makes
a distribution in respect of all of its outstanding Common Stock in property or securities,
including any options, warrants, rights or privileges in respect of securities (other than a
distribution of Common Stock, but including any options, warrants, rights or privileges exercisable
for, convertible into or exchangeable for Common Stock) (a “Non-Cash Distribution”),
Borrower shall deliver to Lender (whether or not Borrower is a holder of any or all of the
outstanding Loaned Shares) in kind, within one Business Day after the date of such Non-Cash
Distribution, the property or securities distributed in an amount equal to the product of (i) the
amount per share of Common Stock of such Non-Cash Distribution and (ii) the number of Loaned Shares
outstanding on the record date for such distribution.



     (c) Any interest, cash distribution or cash dividend made on or in respect of any Collateral
for any Loan hereunder, shall, subject to (e) below, be delivered by the Collateral Agent to
Borrower, on the date such interest, cash distribution or cash dividend is received by the
Collateral Agent.



     (d) Any non-cash distributions or dividend made on or in respect of any Collateral for any
Loan hereunder shall, subject to (e) below, be delivered by the Collateral Agent to Borrower on the
date such non-cash distribution or dividend is received by the Collateral Agent.



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     (e) If the cash or other property received by the Collateral Agent under the provisions of
paragraph (c) or (d) of this Section 7 qualifies as Collateral, to the extent that a transfer of
such cash or other property to Borrower by the Collateral Agent would give rise to a Collateral
Deficit, the Collateral Agent shall (only to the extent of any such Collateral Deficit) not make
such transfer of cash or other property in accordance with this Section 7, but shall in lieu of
such transfer immediately credit the amounts that would otherwise have been transferable under this
Section 7 to the Collateral Account.



     Section 8. Rights in Respect of Loaned Shares. Subject to the terms of this
Agreement, Borrower, insofar as it is the record owner of Loaned Shares, shall have all of the
incidents of ownership in respect of any such Loaned Shares until such Loaned Shares are required
to be delivered to Lender in accordance with this Agreement including the right to transfer the
Loaned Shares to others. Borrower agrees that it or any of its Affiliates that are the record
owner of any Loaned Shares will not vote such Loaned Shares on any matter submitted to a vote of
Lender’s shareholders.



     Section 9. Representations and Warranties.



     (a) Each of Borrower and Lender represent and warrant to the other that:




     (i) it has full power to execute and deliver this Agreement, to enter into the
Loans contemplated hereby and to perform its obligations hereunder;




     (ii) it has taken all necessary action to authorize such execution, delivery
and performance;




     (iii) this Agreement constitutes its legal, valid and binding obligation
enforceable against it in accordance with its terms; and




     (iv) the execution, delivery and performance of this Agreement does not and
will not violate, contravene, or constitute a default under, (A) its certificate of
incorporation, bylaws or other governing documents, (B) any laws, rules or
regulations of any governmental authority to which it is subject, (C) any contracts,
agreements or instrument to which it is a party or (D) any judgment, injunction,
order or decree by which it is bound.



     (b) Lender represents and warrants to Borrower, as of the date hereof, and as of the date any
Loaned Shares are transferred to Borrower in respect of any Loan hereunder, that the Loaned Shares
and all other outstanding shares of Common Stock of the Lender have been duly authorized and, upon
the issuance and delivery of the Loaned Shares to Borrower in accordance with the terms and
conditions hereof, and subject to the contemporaneous or prior receipt of the applicable Loan Fee
by Lender, will be duly authorized, validly issued, fully paid nonassessible shares of Common
Stock; and the stockholders of Lender have no preemptive rights with respect to the Loaned Shares.




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     (c) Lender represents and warrants to Borrower, as of the date hereof, and as of the date any
Loaned Shares are transferred to Borrower in respect of any Loan hereunder, that the outstanding
shares of Common Stock are listed on NASDAQ Global Market (“NASDAQ”) and the Loaned Shares
have been approved for listing on NASDAQ, subject to official notice of issuance.



     (d) Lender represents and warrants to Borrower, as of the date any Loaned Shares are
transferred to Borrower in respect of any Loan hereunder, Lender is not “insolvent” (as such term
is defined under Section 101(32) of Title 11 of the United States Code (the “Bankruptcy
Code”)).



     (e) Lender represents to Borrower that for United States tax purposes it is a resident of the
United States.



     (f) The representations and warranties of Borrower and Lender under this Section 9 shall
remain in full force and effect at all times during the term of this Agreement and shall survive
the termination for any reason of this Agreement.



     Section 10. Covenants.



     (a) The parties hereto acknowledge that Borrower has informed Lender that Borrower is a
“financial institution” within the meaning of Section 101(22) of the Bankruptcy Code. The parties
hereto further acknowledge and agree that (i) each Loan hereunder is intended to be a “securities
contract,” as such term is defined in Section 741(7) of the Bankruptcy Code; (ii) each and every
transfer of funds, securities and other property under this Agreement is intended to be a
“settlement payment” or a “margin payment,” as such terms are used in Sections 362(b)(6) and
546(e) of the Bankruptcy Code; and (iii) the rights given to Lender hereunder upon a Default by
Borrower are intended to constitute the rights to cause the liquidation of a securities contract
and to set off mutual debts and claims in connection with a securities contract, as such terms are
used in Sections 555 and 362(b)(6) of the Bankruptcy Code.



     (b) Borrower covenants and agrees with Lender that insofar as it is the record owner of any
Loaned Shares, such Loaned Shares will be used, if at all, solely for the purpose of directly or
indirectly (y) facilitating the sale and the hedging of the Convertible Notes by the holders
thereof or, (z) with the prior written consent of the Lender, facilitating the sale and the hedging
of any additional convertible securities which the Lender may issue from time to time by the
holders thereof.



     (c) Lender shall, no later than five Business Days prior to any day on which Lender effects a
repurchase of Common Stock, give Borrower a written notice of such repurchase (a “Repurchase
Notice”) if, following such repurchase, the Maximum Borrow Percentage (as defined below) after
giving effect to such repurchase would be greater by 0.5% than the Maximum Borrow Percentage
included in the immediately preceding Repurchase Notice (or, in the case of the first such
Repurchase Notice, greater than the Maximum Borrow Percentage as of the date hereof). The
“Maximum Borrow Percentage” as of any day is the fraction, the



11









 







numerator of which is the Maximum Number of Shares on such day, and the denominator of which
is the number of shares of Common Stock outstanding on such day, including all outstanding Loaned
Shares.



     Section 11. Events of Default.



     (a) All Loans, and any further obligation to make Loans under this Agreement, may, at the
option of Lender by a written notice to Borrower (which option shall be deemed exercised, even if
no notice is given, immediately on the occurrence of an event specified in Section 11(a)(iv)
below), be terminated (i) immediately on the occurrence of any of the events set forth in Section
11(a)(iv) below and (ii) two Business Days following such notice on the occurrence of any of the
other events set forth below, (each, a “Default”):




     (i) Borrower fails to deliver Loaned Shares to Lender as required by Section 6;




     (ii) Borrower fails to deliver or pay to Lender when due any cash, securities
or other property as required by Section 7;




     (iii) Borrower fails to transfer Collateral when due as required by Section 3
and Section 4;




     (iv) the occurrence of any of the following:




          (A) the Borrower is unable or admits its inability to pay its debts as they
fall due, suspends making payments (whether principal or interest) on any of its
debts or announces an intention to do so or, by reason of actual or anticipated
financial difficulties, commences negotiations with one or more of its creditors
with a view to rescheduling any of its indebtedness or is otherwise deemed unable to
pay its debts within the meaning of section 123(a), (b), or (2) of the Insolvency
Act 1986 (United Kingdom); and/or




          (B) any corporate action, legal proceedings or other procedure or step is taken
in relation to:




          (a) the suspension of its payments, a moratorium of any of its
indebtedness, its winding-up, its dissolution, its administration or
reorganization (by way of voluntary arrangement, scheme of
arrangement or otherwise) other than a solvent liquidation or
reorganization with another entity with which it forms a group or an
order is made or a resolution passed for its winding up;




          (b) a composition, compromise, assignment or arrangement with
any of its creditors;



12









 






          (c) the appointment of a liquidator, receiver, administrative
receiver administrator, compulsory manager or other similar officer
in respect of it or of its assets; or




          (d) enforcement of any security interests created over any of
its assets;




          or any analogous procedure or step is taken in respect of it in any jurisdiction;




     (v) Borrower fails to provide any indemnity as required by Section 14;




     (vi) Borrower notifies Lender of its inability to or intention not to perform
Borrower’s obligations hereunder or otherwise disaffirms, rejects or repudiates any
of its obligations hereunder; or




     (vii) Any representation made by Borrower under this Agreement in connection
with any Loan or Loans hereunder shall be incorrect or untrue in any material
respect during the term of any Loan hereunder or Borrower fails to comply in any
material respect with any of its covenants under this Agreement.



     Section 12. Lender’s Remedies.



     (a) Upon the termination of any Loan by Lender under Section 11, Borrower may, with the prior
written consent of Lender (which consent may be withheld at Lender’s sole discretion; provided
however that, Lender shall not withhold such request if Borrower as a result would unavoidably
become, directly or indirectly, a Beneficial Owner of more than 9.0% of the shares of Common Stock
outstanding at such time), in lieu of the delivery of Loaned Shares to Lender in accordance with
Section 6, pay to Lender, no later than one Business Day following notice of such Default to
Borrower, an amount in immediately available funds (the “Replacement Cash”) equal to the
product of the Closing Price as of the date of such notice of Default and the number of Loaned
Shares otherwise required to be delivered; provided that if Lender consents to the delivery of
Replacement Cash, Borrower may direct the Collateral Agent to deliver to Lender any Collateral held
by the Collateral Agent in respect of the Loan so terminated and, to the extent the Market Value of
any such Collateral delivered to Lender is less than the required amount of Replacement Cash, pay
to Lender such difference in immediately available funds. Any Collateral in respect of the Loan so
terminated that is not so delivered to Lender pursuant to this clause shall, upon payment in full
of the Replacement Cash to Lender, be immediately delivered by Collateral Agent to Borrower.



     (b) Notwithstanding anything to the contrary herein, if on any date on which Borrower is
required to return Loaned Shares to Lender, the purchase of Common Stock in an amount equal to all
or any portion of the number of Loaned Shares to be delivered to Lender in accordance with Section
6 shall (A) be prohibited by any law, rules or regulation of any governmental authority to which it
is or would be subject, (B) violate, or would upon such purchase likely violate, any order or
prohibition of any court, tribunal or other governmental authority, (C) require the prior consent
of any court, tribunal or governmental authority prior to any such



13









 







repurchase, (D) subject Borrower, in the reasonable judgment of Borrower, to any liability or
potential liability under any applicable federal securities laws, or (E) be commercially
impracticable, in the reasonable judgment of Borrower, in the time period required by Section 6
(each of (A), (B), (C), (D) and (E), a “Redelivery Obstacle”), then, in each case, Borrower
shall immediately notify Lender of the Redelivery Obstacle and the basis therefor, whereupon
Borrower’s obligations under Section 6 as to such Loaned Shares shall be suspended until such time
as no Redelivery Obstacle with respect to such obligations shall exist (a “Redelivery
Suspension”). Following the occurrence of and during the continuation of any Redelivery
Suspension, Borrower shall use commercially reasonable efforts to remove or cure the Redelivery
Obstacle as promptly as reasonably practicable. If Borrower is unable to remove or cure the
Redelivery Obstacle within thirty Business Days of the date on which Borrower is required to return
Loaned Shares pursuant to Section 6, Borrower shall pay to Lender, in lieu of the delivery of
Loaned Shares in accordance with Section 6, Replacement Cash equal to the product of the Closing
Price as of the Business Day immediately preceding the date Borrower makes such payment and the
number of Loaned Shares otherwise required to be delivered. If Borrower does not pay such
Replacement Cash during any Pledge Period, Lender shall have the right, exercisable in it sole
discretion, to direct the Collateral Agent to, and the Collateral Agent upon receipt of the written
request of Lender (with a copy to Borrower) shall, release to Lender an amount of Collateral with a
Market Value equal to the Market Value of all (or such fewer number as Lender may specify) of the
Loaned Shares that are the subject of the Redelivery Suspension, whereupon the Borrower’s
obligation to return the specified number of Loaned Shares to the Lender shall be automatically
extinguished.



     (c) If Borrower shall fail to deliver Loaned Shares to Lender pursuant to Section 6 when due
or shall fail to pay the Replacement Cash to Lender when due in accordance with Section 12(a) or
(b) above (to the extent Borrower is permitted and elects to pay Replacement Cash), then, in either
case, in addition to any other remedies available to Lender under this Agreement or under
applicable law, Lender shall have the right (without further notice to Borrower) to (i) purchase a
like amount of Loaned Shares (“Replacement Shares”) in the principal market for such securities in
a commercially reasonable manner, (ii) sell any Collateral in the principal market for such
Collateral in a commercially reasonable manner and (iii) apply and set off the Collateral, if any,
and any proceeds thereof against the payment of the purchase price for such Replacement Shares and
any amount due to Lender hereunder; provided that Lender may not proceed under (ii) or (iii) until
20 days has elapsed since the failure to deliver such Loaned Shares or pay such Replacement Cash
and Borrower has not delivered such Loaned Shares or paid such Replacement Cash since such failure.
To the extent Lender shall exercise such right, Borrower’s obligation to return a like amount of
Loaned Shares or to pay the Replacement Cash, as applicable, shall terminate and Borrower shall be
liable to Lender for the purchase price of Replacement Shares (plus all other amounts, if any, due
to Lender hereunder). In the event that the purchase price of Replacement Shares (plus all other
amounts, if any, due to Lender hereunder) exceeds the amount of Collateral, if any, Borrower shall
be liable to Lender for the amount of such excess. The purchase price of Replacement Shares
purchased under this Section 12 shall include, and the proceeds of any sale of Collateral shall be
determined after deduction of, broker’s fees and commissions and all other reasonable costs, fees
and expenses related to



14









 







such purchase and sale. In the event Lender exercises its rights under this Section 12,
Lender may elect in its sole discretion, in lieu of purchasing all or a portion of the Replacement
Shares or selling all or a portion of the Collateral, to be deemed to have made such purchase of
Replacement Shares or sale of Collateral, as applicable, for an amount equal to the Closing Price
of the Common Stock on the date Lender elects to exercise this remedy. Upon the satisfaction of all
Borrower’s obligations hereunder, any remaining Collateral shall be returned to Borrower.



     Section 13. Transfers.



     (a) All transfers of Loaned Shares to Borrower or to Lender hereunder shall be made through
the Clearing Organization. All transfers of Collateral to the Collateral Agent by Borrower shall
be made by crediting the Collateral Account. All transfers of Collateral to Lender by the
Collateral Agent shall be made in the manner directed by Lender. In every transfer of “financial
assets” (within the meaning of Section 8-102 of the UCC) hereunder, the transferor shall take all
steps necessary (a) to effect a delivery to the transferee under Section 8-301 of the UCC, or to
cause the creation of a security entitlement in favor of the transferee under Section 8-501 of the
UCC, (b) to enable the transferee to obtain “control” (within the meaning of Section 8-106 of the
UCC), and (c) to provide the transferee with comparable rights under any applicable foreign law or
regulation.



     (b) All transfers of cash hereunder to Borrower or Lender shall be by wire transfer in
immediately available, freely transferable funds.



     (c) A transfer of securities or cash may be effected under this Section 13 on any day except
(i) a day on which the transferee is closed for business at its address set forth in Section 18 or
(ii) a day on which the Clearing Organization or wire transfer system is closed, if the facilities
of the Clearing Organization or wire transfer system are required to effect such transfer.



     (d) The rights and duties of Borrower under this Agreement may not be assigned or transferred
by Borrower without the prior written consent of Lender, such consent not to be unreasonably
withheld; provided that Borrower may assign or transfer any of its rights or duties hereunder to
Borrower’s ultimate parent entity or any directly or indirectly wholly-owned subsidiary or
Affiliate of Borrower’s ultimate parent entity (a “Permitted Transferee”) without the prior
written consent of Lender as long as such Permitted Transferee is of equal or better credit rating
as the borrower or is guaranteed by the Borrower or an entity of equal or better credit rating as
the Borrower.



     Section 14. Indemnities.



     (a) Lender hereby agrees to indemnify and hold harmless Borrower and its Affiliates and its
former, present and future directors, officers, employees and other agents and representatives from
and against any and all liabilities, judgments, claims, settlements, losses, damages, fees, liens,
taxes, penalties, obligations and expenses incurred or suffered by any such person or entity
directly or indirectly arising from, by reason of, or in connection with, (i) any breach by Lender



15









 







of any of its representations or warranties contained in Section 9 or (ii) any breach by
Lender of any of its covenants or agreements in this Agreement.



     (b) Borrower hereby agrees to indemnify and hold harmless Lender and its Affiliates and its
former, present and future directors, officers, employees and other agents and representatives from
and against any and all liabilities, judgments, claims, settlements, losses, damages, fees, liens,
taxes, penalties, obligations and expenses , including without limitation any of the foregoing
incurred pursuant to indemnification or other provisions of other agreements, incurred or suffered
by any such person or entity directly or indirectly arising from, by reason of, or in connection
with (i) any breach by Borrower of any of its representations or warranties contained in Section 9
or (ii) any breach by Borrower of any of its covenants or agreements in this Agreement.



     (c) In case any claim or litigation which might give rise to any obligation of a party under
this Section 14 (each an “Indemnifying Party”) shall come to the attention of the party
seeking indemnification hereunder (the “Indemnified Party”), the Indemnified Party shall
promptly notify the Indemnifying Party in writing of the existence and amount thereof; provided
that the failure of the Indemnified Party to give such notice shall not adversely affect the right
of the Indemnified Party to indemnification under this Agreement, except to the extent the
Indemnifying Party is materially prejudiced thereby. The Indemnifying Party shall promptly notify
the Indemnified Party in writing if it accepts such claim or litigation as being within its
indemnification obligations under this Section 14. Such response shall be delivered no later than
30 days after the initial notification from the Indemnified Party; provided that, if the
Indemnifying Party reasonably cannot respond to such notice within 30 days, the Indemnifying Party
shall respond to the Indemnified Party as soon thereafter as reasonably possible.



     (d) An Indemnifying Party shall be entitled to participate in and, if (i) in the judgment of
the Indemnified Party such claim can properly be resolved by money damages alone and the
Indemnifying Party has the financial resources to pay such damages and (ii) the Indemnifying Party
admits that this indemnity fully covers the claim or litigation, the Indemnifying Party shall be
entitled to direct the defense of any claim at its expense, but such defense shall be conducted by
legal counsel reasonably satisfactory to the Indemnified Party. An Indemnified Party shall not
make any settlement of any claim or litigation under this Section 14 without the written consent of
the Indemnifying Party.



     Section 15. Termination of Agreement.



     (a) This Agreement may be terminated (i) at any time by the written agreement of Lender and
Borrower, (ii) by Lender upon the occurrence of a Default or (iii) upon the earlier of (A) June 15,
2013 and (B) the date on which the Lender has notified the Borrower in writing of its intention to
terminate this Agreement at any time after the latest of (y) the date on which the entire principal
amount of Convertible Notes ceases to be outstanding and (z) the date on which the entire principal
amount of any additional convertible securities of the Lender which the Lender has in writing
consented to permit the Borrower to hedge under this Agreement ceases to



16









 







be outstanding, in each case, whether as a result of conversion, redemption, repurchase,
cancellation or otherwise.



     (b) Unless otherwise agreed by Borrower and Lender, the provisions of Section 14 shall survive
the termination of this Agreement.



     Section 16. Registration Provisions. If, following the initial Loan hereunder and
registration of the initial Loaned Shares in respect of such Loan, any subsequent Loan and public
sale of the Loaned Shares in respect of such subsequent Loan, in the reasonable opinion of counsel
to Borrower, would require registration under the Securities Act of 1933, as amended, Lender shall
register such sale in a form and manner reasonably satisfactory to Borrower, and shall enter into
an underwriting agreement substantially in the form of the Underwriting Agreement dated as of June
18, 2008 relating to the issuance and sale of such initial Loaned Shares and shall afford Borrower
and its representatives and agents an opportunity to conduct an appropriate “due diligence”
investigation to Borrower’s reasonable satisfaction, all at the expense of Lender. In no event
shall this Section 16 require Lender to register shares of Common Stock in excess of the Maximum
Number of Shares.



     Section 17. Delivery of Shares. Notwithstanding anything to the contrary herein,
Borrower may, by prior notice to Lender, satisfy its obligation to deliver any shares of Common
Stock on any date due under the terms of this Agreement (an “Original Delivery Date”) by
making separate deliveries of shares of Common Stock at more than one time on or prior to such
Original Delivery Date, so long as the aggregate number of shares of Common Stock so delivered on
or prior to such Original Delivery Date is equal to the number required to be delivered on such
Original Delivery Date.



     Section 18. Notices.



     (a) All notices and other communications hereunder shall be in writing and shall be deemed to
have been duly given when received.



     (b) All such notices and other communications shall be directed to the following address:




	 	(i)	 	If to Borrower or Borrowing Agent to:
	 
	 	 	 	Credit Suisse Securities (USA) LLC

Eleven Madison Avenue

New York, NY 10010

	 
	 	(ii)	 	If to Collateral Agent to:

	 
	 	 	 	Credit Suisse Securities (USA) LLC, as Collateral Agent,

Eleven Madison Avenue

New York, NY 10010




17









 






	 	(iii)	 	If to Lender to:
	 
	 	 	 	Energy Conversion Devices, Inc.

2956 Waterview Drive

Rochester Hills, Michigan 48309

Facsimile: (248) 844-1214

Attention: General Counsel
	 
	 	 	 	With a copy to:
	 
	 	 	 	W. Andrew Jack

Covington & Burling LLP

1201 Pennsylvania Ave., NW

Washington, DC 20004

(202) 778-5232





     (c) In the case of any party, at such other address as may be designated by written notice to
the other parties.



     Section 19. Governing Law; Submission To Jurisdiction; Severability.



     (a) This Agreement shall be governed by and construed in accordance with the laws of the State
of New York, but excluding any choice of law provisions that would require the application of the
laws of a jurisdiction other than New York.



     (b) EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY (A) SUBMITS TO THE NON-EXCLUSIVE
JURISDICTION OF ANY UNITED STATES FEDERAL OR NEW YORK STATE COURT SITTING IN NEW YORK CITY, AND ANY
APPELLATE COURT FROM ANY SUCH COURT, SOLELY FOR THE PURPOSE OF ANY SUIT, ACTION OR PROCEEDING
BROUGHT TO ENFORCE ITS OBLIGATIONS HEREUNDER OR RELATING IN ANY WAY TO THIS AGREEMENT OR ANY LOAN
HEREUNDER AND (B) WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, ANY DEFENSE OF AN
INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT AND ANY RIGHT
OF JURISDICTION ON ACCOUNT OF ITS PLACE OF RESIDENCE OR DOMICILE.



     (c) EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES ANY RIGHT THAT IT MAY HAVE TO TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.



     (d) To the extent permitted by law, the unenforceability or invalidity of any provision or
provisions of this Agreement shall not render any other provision or provisions herein contained
unenforceable or invalid.



18









 





     Section 20. Designation of Replacement Collateral Agent. If at any time while this
Agreement is in effect (i) Credit Suisse Securities (USA) LLC ceases to be a securities
intermediary or (ii) Lender shall determine, in its sole discretion, that any of the relationships
by or among the parties hereto are reasonably likely to prevent Lender from acquiring, or
jeopardize the continuation and enforceability of, Lender’s continuing first priority security
interest in the Collateral as contemplated under Section 3(b), Lender shall be entitled to
designate a bank or trust company reasonably satisfactory to Borrower as a successor Collateral
Agent. In the event of a designation of a successor Collateral Agent, each of the parties to this
Agreement agrees to take all such actions as are reasonably necessary to effect the transfer of
rights and obligations of Credit Suisse Securities (USA) LLC as Collateral Agent hereunder to such
successor Collateral Agent, including the execution and delivery of amendments to this Agreement as
shall be necessary to effect such designation and transfer.



     Section 21. Counterparts. This Agreement may be executed in any number of
counterparts, and all such counterparts taken together shall be deemed to constitute one and the
same agreement.



19









 





     IN WITNESS WHEREOF, the parties hereto to have executed this Share Lending Agreement as of the
date and year first above written.



	 	 	 	 	 	 	 
	Energy Conversion Devices, Inc.


as Lender	 	Credit Suisse International

as Borrower
	 
	 	 	 	 	 	 
	By:

	 	/s/ Kelly R. Baker	 	By:	 	/s/ Tobias Schraven
	 

	 	 
	 	 	 	 
	Name:

	 	Kelly R. Baker	 	Name:	 	Tobias Schraven
	Title:

	 	VP and Treasurer	 	Title:	 	Director
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Steven Winnert
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	Steven Winnert
	 

	 	 	 	Title:	 	Managing Director
	 
	 	 	 	 	 	 
	 	 	 	 	Credit Suisse Securities (USA) LLC

as Collateral Agent
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Barry Dixon
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	Barry Dixon
	 

	 	 	 	Title:	 	Vice President
	 
	 	 	 	 	 	 
	 	 	 	 	Credit Suisse Securities (USA) LLC

as Borrowing Agent
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Marisa Scauzillo
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	Marisa Scauzillo
	 

	 	 	 	Title:	 	Vice President