Document:

Exhibit 10.3

 

	
 
    	
September 25, 2012
    
	
 
    	
 
    
	
To:
    	
GT Advanced Technologies Inc.
    
	
 
    	
20 Trafalgar Square
    
	
 
    	
Nashua, NH 03063
    
	
 
    	
Attn: Hoil Kim, General Counsel
    
	
 
    	
Telephone: (603) 883-5200
    
	
 
    	
 
    
	
From:
    	
Credit Suisse International
    
	
 
    	
c/o Credit Suisse AG, New York Branch
    
	
 
    	
Eleven Madison Avenue
    
	
 
    	
New York, NY 10010-3629
    
	
 
    	
Attn:
    	
John Carr
    
	
 
    	
Telephone:
    	
212-325-2130
    
	
 
    	
Facsimile:
    	
212-325-5338
    
	
 
    	
 
    
	
Re:
    	
Base Convertible Bond Hedge Transaction
    
	
 
    	
(Transaction   Reference Number:                                           )
    

 

Ladies and Gentlemen:

 

The purpose of this communication (this “Confirmation”) is to set forth the terms and conditions of the above-referenced transaction entered into on the Trade Date specified below (the “Transaction”) between Credit Suisse International (“Dealer”), represented by Credit Suisse AG, New York Branch (“Agent”) and GT Advanced Technologies Inc. (“Counterparty”).  This communication constitutes a “Confirmation” as referred to in the ISDA Master Agreement specified below.

 

1.               This Confirmation is subject to, and incorporates, the definitions and provisions of the 2006 ISDA Definitions (the “2006 Definitions”) and the definitions and provisions of the 2002 ISDA Equity Derivatives Definitions (the “Equity Definitions”, and together with the 2006 Definitions, the “Definitions”), in each case as published by the International Swaps and Derivatives Association, Inc. (“ISDA”).  In the event of any inconsistency between the 2006 Definitions and the Equity Definitions, the Equity Definitions will govern.  Certain defined terms used herein have the meanings assigned to them in the Indenture to be dated as of September 28, 2012 (the “Base Indenture”), as supplemented by a Supplemental Indenture thereto to be dated as of September 28, 2012 (the “Supplemental Indenture”), between Counterparty and U.S. Bank National Association, as trustee (the Base Indenture as so supplemented, the “Indenture”), relating to the USD205,000,000 aggregate principal amount of 3.00% convertible senior notes due 2017 (the “Convertible Notes”).  In the event of any inconsistency between the terms defined in the Indenture and this Confirmation, this Confirmation shall govern.  For the avoidance of doubt, references herein to sections of the Supplemental Indenture are based on the draft of the Supplemental Indenture most recently reviewed by the parties at the time of execution of this Confirmation. If any relevant sections of the Supplemental Indenture are changed, added or renumbered following execution of this Confirmation but prior to the execution of the Supplemental Indenture, the parties will amend this Confirmation in good faith to preserve the economic intent of the parties based on the draft of the Supplemental Indenture so reviewed.  The parties further acknowledge that references to the Supplemental Indenture herein are references to the Supplemental Indenture as in effect on the date of its execution and if the Supplemental Indenture is amended following its execution, any such amendment will be disregarded for purposes of this Confirmation (other than as provided in Section 8(a) below) unless the parties agree otherwise in writing.

 

This Confirmation evidences a complete and binding agreement between Dealer and Counterparty as to the terms of the Transaction to which this Confirmation relates.  This Confirmation shall be subject to an agreement (the “Agreement”) in the form of the ISDA 2002 Master Agreement as if Dealer and Counterparty had executed an agreement in such form (without any Schedule but with the elections set forth in this Confirmation).  For the avoidance of doubt, the Transaction shall be the only transaction under the Agreement.

 

All provisions contained in, or incorporated by reference to, the Agreement will govern this Confirmation except as expressly modified herein.  In the event of any inconsistency between this Confirmation and either the Definitions or the Agreement, this Confirmation shall govern.

 

 

2.               The Transaction constitutes a Share Option Transaction for purposes of the Equity Definitions.  The terms of the particular Transaction to which this Confirmation relates are as follows:

 

	
General Terms:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Trade   Date:
    	
 
    	
September 25,   2012
    
	
 
    	
 
    	
 
    
	
Effective   Date:
    	
 
    	
The   closing date of the initial issuance of the Convertible Notes.
    
	
 
    	
 
    	
 
    
	
Option   Type:
    	
 
    	
Call
    
	
 
    	
 
    	
 
    
	
Seller:
    	
 
    	
Dealer
    
	
 
    	
 
    	
 
    
	
Buyer:
    	
 
    	
Counterparty
    
	
 
    	
 
    	
 
    
	
Shares:
    	
 
    	
The   common stock of Counterparty, par value USD0.01 per share (Ticker Symbol:   “GTAT”).
    
	
 
    	
 
    	
 
    
	
Number   of Options:
    	
 
    	
The   number of Convertible Notes in denominations of USD1,000 principal amount   issued by Counterparty on the closing date for the initial issuance of the   Convertible Notes.
    
	
 
    	
 
    	
 
    
	
Number   of Shares:
    	
 
    	
As   of any date, the product of   (i) the Number of Options, (ii) the Conversion Rate and (iii) the Applicable Percentage.
    
	
 
    	
 
    	
 
    
	
Conversion   Rate:
    	
 
    	
As   of any date, the “Conversion Rate” (as defined in the Indenture) as of such   date, but without regard to any adjustments to the “Conversion Rate” pursuant   to Section 8.03 or 8.04(h) of the Supplemental Indenture.
    
	
 
    	
 
    	
 
    
	
Applicable   Percentage:
    	
 
    	
25%
    
	
 
    	
 
    	
 
    
	
Strike   Price:
    	
 
    	
USD7.7090
    
	
 
    	
 
    	
 
    
	
Premium:
    	
 
    	
As   provided in Annex A to this Confirmation.
    
	
 
    	
 
    	
 
    
	
Premium   Payment Date:
    	
 
    	
The   Effective Date
    
	
 
    	
 
    	
 
    
	
Exchange:
    	
 
    	
The   NASDAQ Global Select Market
    
	
 
    	
 
    	
 
    
	
Related   Exchange:
    	
 
    	
All   Exchanges
    
	
 
    	
 
    	
 
    
	
Procedures for Exercise:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Exercise   Dates:
    	
 
    	
Each   Conversion Date.
    
	
 
    	
 
    	
 
    
	
Conversion   Date:
    	
 
    	
Each   “Conversion Date”, as defined in the Indenture, occurring during the period   from and excluding the Trade Date to but excluding the Expiration Date, for   Convertible Notes, each in denominations of USD1,000 principal amount, that   are submitted for conversion on such Conversion Date in accordance with the   terms of the Indenture (such Convertible Notes, the “Relevant Convertible Notes” for such   Conversion Date).
    
	
 
    	
 
    	
 
    
	
Required   Exercise on Conversion Dates:
    	
 
    	
On   each Conversion Date, a number of Options equal to the number of Relevant   Convertible Notes for such Conversion Date in denominations of USD1,000   principal amount shall be automatically exercised.
    
	
 
    	
 
    	
 
    
	
Expiration   Date:
    	
 
    	
The   Scheduled Valid Day immediately preceding the “Maturity Date” (as defined in   the Indenture).
    
	
 
    	
 
    	
 
    
	
Automatic   Exercise:
    	
 
    	
As   provided above under “Required Exercise on Conversion Dates”.
    

 

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Exercise   Notice Deadline:
    	
 
    	
In   respect of any exercise of Options hereunder on any Conversion Date, the   Exchange Business Day prior to the first Scheduled Valid Day of the   Settlement Averaging Period relating to the Convertible Notes converted on   the Conversion Date occurring on the relevant Exercise Date; provided that in the case of any exercise of Options   hereunder in connection with the conversion of any Relevant Convertible Notes   on any Conversion Date occurring during the period starting on and including   April 1, 2017 and ending on and including the second Scheduled Valid Day   immediately preceding the “Maturity Date” (as defined in the Indenture) (the   “Final Conversion Period”), the   Exercise Notice Deadline shall be the Exchange Business Day immediately   following such Conversion Date.
    
	
 
    	
 
    	
 
    
	
Notice   of Exercise:
    	
 
    	
Notwithstanding   anything to the contrary in the Equity Definitions or under “Automatic   Exercise” above, Dealer shall have no obligation to make any payment or   delivery in respect of any exercise of Options hereunder unless Counterparty   notifies Dealer in writing prior to 4:00 PM, New York City time, on the   Exercise Notice Deadline in respect of such exercise of (i) the number   of Options being exercised on the relevant Exercise Date, (ii) the   scheduled Settlement Date and the first Scheduled Valid Day of the Settlement   Averaging Period, (iii) the Relevant Settlement Method for such Options,   and (iv)  if the settlement method for the Relevant Convertible Notes is   not Settlement in Shares or Settlement in Cash (each as defined below), the fixed   amount of cash per Convertible Note that Counterparty has elected to deliver   to “Holders” (as defined in the Indenture) of the Relevant Convertible Notes   (the “Specified Cash Amount”); provided that in the case of any exercise of Options   hereunder in connection with the conversion of any Relevant Convertible Notes   on any Conversion Date occurring during the Final Conversion Period,   (A) the contents of such notice shall be as set forth in clause   (i) above and (B) if the Relevant Settlement Method for such   Options is (x) Net Share Settlement and the Specified Cash Amount is not   USD1,000, (y) Cash Settlement or (z) Combination Settlement, Dealer   shall have received a separate notice (the “Notice of   Final Settlement Method”) in respect of all such Convertible Notes   before 4:00 PM, New York City time, on April 1, 2017 specifying the   information required in clauses (iii) and (iv) above. Counterparty   acknowledges its responsibilities under applicable securities laws, and in   particular Section 9 and Section 10(b) of the Exchange Act (as   defined below) and the rules and regulations thereunder, in respect of   any election of a settlement method with respect to the Convertible Notes.   For the avoidance of doubt, if Counterparty fails to give such notice when   due in respect of any exercise of Options hereunder, Dealer’s obligation to   make any payment and/or delivery in respect of such exercise shall be   permanently extinguished, and late notice shall not cure such failure; provided that notwithstanding the foregoing, such notice   (and the related exercise of Options) shall be effective if given after the   Exercise Notice Deadline, but prior to 4:00 PM, New York City time, on the   fifth Exchange Business Day following the Exercise Notice Deadline, in which   event the Calculation Agent shall have the right to adjust the Delivery   Obligation as appropriate to reflect the additional costs (including, but not   limited to,
    

 

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hedging   mismatches and market losses) and expenses incurred by Dealer in connection   with its hedging activities (including the unwinding of any hedge position)   as a result of Dealer not having received such notice on or prior to the   Exercise Notice Deadline.
    
	
 
    	
 
    	
 
    
	
Market   Disruption Event:
    	
 
    	
Section 6.3(a) of   the Equity Definitions is hereby replaced in its entirety by the following:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
“‘Market   Disruption Event’ means, in respect of a Share, (i) a failure by the   primary U.S. national or regional securities exchange or market on which the   Shares are listed or admitted for trading to open for trading during its   regular trading session or (ii) the occurrence or existence prior to   1:00 PM, New York City time, on any Scheduled Valid Day for the Shares for   more than one half-hour period in the aggregate during regular trading hours   of any suspension or limitation imposed on trading (by reason of movements in   price exceeding limits permitted by the relevant stock exchange or otherwise)   in the Shares or in any options contracts or futures contracts relating to   the Shares.
    
	
 
    	
 
    	
 
    
	
Dealer’s   Telephone Number and Telex and/or Facsimile Number and Contact Details for   purpose of Giving Notice:
    	
 
    	
To   be provided by Dealer.
    
	
 
    	
 
    	
 
    
	
Settlement   Terms:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Settlement   Method:
    	
 
    	
For   any Option, Net Share Settlement; provided that   if the Relevant Settlement Method set forth below for such Option is not Net   Share Settlement, then the Settlement Method for such Option shall be such   Relevant Settlement Method, but only if Counterparty shall have notified   Dealer of the Relevant Settlement Method in the Notice of Exercise or Notice   of Final Settlement Method, as applicable, for such Option.
    
	
 
    	
 
    	
 
    
	
Relevant   Settlement Method:
    	
 
    	
In   respect of any Option:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(i)                                     if   Counterparty has elected to settle its conversion obligations in respect of   the Relevant Convertible Note (A) entirely in Shares pursuant to   Section 8.02(a)(iv)(A) of the Supplemental Indenture (together with   cash in lieu of fractional Shares) (such settlement method, “Settlement in Shares”), (B) in a combination of cash   and Shares pursuant to Section 8.02(a)(iv)(C) of the Supplemental   Indenture with a Specified Cash Amount less than USD1,000 (such settlement   method, “Low Cash Combination Settlement”)   or (C) in a combination of cash and Shares pursuant to   Section 8.02(a)(iv)(C) of the Supplemental Indenture with a   Specified Cash Amount equal to USD1,000, then, in each case, the Relevant   Settlement Method for such Option shall be Net Share Settlement;
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(ii)                                  if   Counterparty has elected to settle its conversion obligations in respect of   the Relevant Convertible Note in a combination of cash and Shares pursuant to   Section 8.02(a)(iv)(C) of the Supplemental Indenture with a   Specified Cash Amount greater than USD1,000, then the Relevant Settlement   Method for such Option shall be Combination Settlement; and
    

 

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(iii)                               if   Counterparty has elected to settle its conversion obligations in respect of   the Relevant Convertible Note entirely in cash pursuant to   Section 8.02(a)(iv)(B) of the Supplemental Indenture (such   settlement method, “Settlement in Cash”),   then the Relevant Settlement Method for such Option shall be Cash Settlement.
    
	
 
    	
 
    	
 
    
	
Net   Share Settlement:
    	
 
    	
If   Net Share Settlement is applicable to any Option exercised or deemed   exercised hereunder, Dealer will deliver to Counterparty, on the relevant   Settlement Date for each such Option, a number of Shares (the “Net Share Settlement Amount”) equal to the sum, for each   Valid Day during the Settlement Averaging Period for each such Option, of   (i) (a) the Daily Option Value for such Valid Day, divided by (b) the Relevant Price on such Valid Day, divided by (ii) the number of Valid Days in the   Settlement Averaging Period; provided that   in no event shall the Net Share Settlement Amount for any Option exceed a   number of Shares equal to the Applicable Limit for such Option, divided by the Applicable Limit Price on the Settlement   Date for such Option.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Dealer   will pay cash in lieu of any fractional Shares to be delivered with respect   to any Net Share Settlement Share Amount valued at the Relevant Price for the   last Valid Day of the Settlement Averaging Period.
    
	
 
    	
 
    	
 
    
	
Combination   Settlement:
    	
 
    	
If   Combination Settlement is applicable to any Option exercised or deemed   exercised hereunder, Dealer will deliver to Counterparty, on the relevant   Settlement Date for each such Option:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(i)                                    cash (the “Combination Settlement Cash Amount”) equal to the sum, for   each Valid Day during the Settlement Averaging Period for such Option, of   (A) an amount (the “Daily Combination Settlement   Cash Amount”) equal to the lesser of (1) the product of (x) the Applicable Percentage and   (y) the Specified Cash Amount minus   USD1,000 and (2) the Daily Option Value, divided by   (B) the number of Valid Days in the Settlement Averaging Period; provided that if the calculation in clause (A) above   results in zero or a negative number for any Valid Day, the Daily Combination   Settlement Cash Amount for such Valid Day shall be deemed to be zero; and
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(ii)                                 Shares (the “Combination Settlement Share Amount”) equal to the sum,   for each Valid Day during the Settlement Averaging Period for such Option, of   a number of Shares for such Valid Day (the “Daily   Combination Settlement Share Amount”) equal to   (A) (1) the Daily Option Value on such Valid Day minus the Daily Combination Settlement Cash Amount for   such Valid Day, divided by (2) the   Relevant Price on such Valid Day, divided by   (B) the number of Valid Days in the Settlement Averaging Period; provided that if the calculation in sub-clause   (A)(1) above results in zero or a negative number for any Valid Day, the   Daily Combination Settlement Share Amount for such Valid Day shall be deemed   to be zero;
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
provided that in no   event shall the sum of (x) the Combination Settlement Cash Amount for   any Option and (y) the Combination
    

 

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Settlement   Share Amount for such Option multiplied by   the Applicable Limit Price on the Settlement Date for such Option, exceed the   Applicable Limit for such Option.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Dealer   will pay cash in lieu of any fractional Shares to be delivered with respect   to any Combination Settlement Share Amount valued at the Relevant Price for   the last Valid Day of the Settlement Averaging Period.
    
	
 
    	
 
    	
 
    
	
Cash   Settlement:
    	
 
    	
If   Cash Settlement is applicable to any Option exercised or deemed exercised   hereunder, in lieu of Section 8.1 of the Equity Definitions, Dealer will   pay to Counterparty, on the relevant Settlement Date for each such Option, an   amount of cash (the “Cash Settlement Amount”   and each of the Net Share Settlement Amount, the sum of the Combination   Settlement Cash Amount and the Combination Settlement Share Amount, and the   Cash Settlement Amount, in each case, with respect to any Option exercised or   deemed exercised hereunder, the “Delivery Obligation”)   equal to the sum, for each Valid Day during the Settlement Averaging Period   for such Option, of (i) the Daily Option Value for such Valid Day, divided by (ii) the number of Valid Days in the   Settlement Averaging Period.
    
	
 
    	
 
    	
 
    
	
Daily   Option Value:
    	
 
    	
For   any Valid Day, an amount equal to (i) the Conversion Rate on such Valid   Day, multiplied by (ii) the Applicable   Percentage, multiplied by (iii) the   Relevant Price on such Valid Day less the   Strike Price on such Valid Day; provided that   if the calculation contained in clause (iii) above results in a negative   number, the Daily Option Value for such Valid Day shall be deemed to be zero.   In no event will the Daily Option Value be less than zero.
    
	
 
    	
 
    	
 
    
	
Applicable   Limit:
    	
 
    	
For   any Option, an amount of cash equal to the Applicable Percentage multiplied by the excess of (i) the aggregate of   (A) the amount of cash, if any, delivered to the “Holder” (as defined in   the Indenture) of the Relevant Convertible Note upon conversion of such   Relevant Convertible Note and (B) the number of Shares, if any,   delivered to the “Holder” (as defined in the Indenture) of the Relevant   Convertible Note upon conversion of Relevant Convertible Note multiplied by the Applicable Limit Price on the Settlement   Date for such Option, over (ii) USD1,000.
    
	
 
    	
 
    	
 
    
	
Applicable   Limit Price:
    	
 
    	
On   any day, the opening price as displayed under the heading “Op” on Bloomberg   page GTAT <equity> (or any successor thereto).
    
	
 
    	
 
    	
 
    
	
Valid   Day:
    	
 
    	
A   day on which (i) there is no Market Disruption Event and (ii) trading   in the Shares generally occurs on the Exchange or, if the Shares are not then   listed on the Exchange, on the principal other U.S. national or regional   securities exchange on which the Shares are then listed or, if the Shares are   not then listed on a U.S. national or regional securities exchange, on the   principal other market on which the Shares are then listed or admitted for   trading. If the Shares are not so listed or admitted for trading, “Valid Day”   means a Business Day.
    
	
 
    	
 
    	
 
    
	
Scheduled   Valid Day:
    	
 
    	
A   day that is scheduled to be a Valid Day on the principal U.S. national or   regional securities exchange or market on which the Shares are listed or   admitted for trading. If the Shares are not so
    

 

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listed   or admitted for trading, “Scheduled Valid Day” means a Business Day.
    
	
 
    	
 
    	
 
    
	
Business   Day:
    	
 
    	
Any   day other than a Saturday, a Sunday or a day on which the Federal Reserve   Bank of New York is authorized or required by law or executive order to close   or be closed.
    
	
 
    	
 
    	
 
    
	
Settlement   Date:
    	
 
    	
For   any Option, the third Scheduled Valid Day immediately following the final   Valid Day of the Settlement Averaging Period for such Option.
    
	
 
    	
 
    	
 
    
	
Relevant   Price:
    	
 
    	
On   any Valid Day, the per Share volume-weighted average price as displayed under   the heading “Bloomberg VWAP” on Bloomberg page “GTAT <equity> AQR” (or   its equivalent successor if such page is not available) in respect of the   period from the scheduled open of trading on the Exchange to the Scheduled   Closing Time of the Exchange on such Valid Day (or if such volume-weighted   average price is unavailable, the market value of one Share on such Valid   Day, as determined by the Calculation Agent using, if practicable, a   volume-weighted average method). The Relevant Price will be determined   without regard to after hours trading or any other trading outside of the   regular trading session trading hours.
    
	
 
    	
 
    	
 
    
	
Settlement   Averaging Period:
    	
 
    	
For   any Option and regardless of the Settlement Method applicable to such Option:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(i)                                     if the related Conversion Date occurs prior to April 1, 2017, the 40   consecutive Valid Days commencing on, and including, the third Valid Day   following such Conversion Date; provided that   if the Notice of Exercise for such Option specifies that Settlement in Shares   or Low Cash Combination Settlement applies to the Relevant Convertible Note,   the Settlement Averaging Period shall be the 80 consecutive Valid Day period   commencing on, and including, the third Valid Day immediately following such   Conversion Date; or
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(ii)                                  if the related Conversion Date occurs on or following April 1, 2017,  the 40 consecutive Valid Days   commencing on, and including, the 42nd Scheduled Valid Day   immediately prior to October 1, 2017; provided that   if the Notice of Exercise or Notice of Final Settlement Method, as   applicable, for such Option specifies that Settlement in Shares or Low Cash Combination Settlement applies to   the Relevant Convertible Note, the Settlement Averaging Period shall be the 80 consecutive Valid Days commencing   on, and including, the 82nd Scheduled Valid Day immediately prior to October 1,   2017.
    
	
 
    	
 
    	
 
    
	
Other   Applicable Provisions:
    	
 
    	
To   the extent Dealer is obligated to deliver Shares hereunder, the provisions of   Sections 9.1(c), 9.8, 9.9, 9.10 and 9.11 (except that the Representation and   Agreement contained in Section 9.11 of the Equity Definitions shall be   modified by excluding any representations therein relating to restrictions,   obligations, limitations or requirements under applicable securities laws arising   as a result of the fact that Counterparty is the Issuer of the Shares) of the   Equity Definitions will be applicable as if “Physical
    

 

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Settlement”   applied to the Transaction.
    
	
 
    	
 
    	
 
    
	
Restricted   Certificated Shares:
    	
 
    	
Notwithstanding   anything to the contrary in the Equity Definitions, Dealer may, in whole or   in part, deliver any Shares required to be delivered to Counterparty   hereunder in certificated form in lieu of delivery through the Clearance System.   With respect to such certificated Shares, the Representation and Agreement   contained in Section 9.11 of the Equity Definitions shall be modified by   deleting the remainder of the provision after the word “encumbrance” in the   fourth line thereof.
    
	
 
    	
 
    	
 
    
	
Share   Adjustments:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Method   of Adjustment:
    	
 
    	
Notwithstanding   Section 11.2 of the Equity Definitions, upon the occurrence of any event or   condition set forth in Sections 8.04(a), (b), (c), (d) and (e) of the   Supplemental Indenture that results in an adjustment under the Indenture, the   Calculation Agent shall make a corresponding adjustment to the terms relevant   to the exercise, settlement or payment of the Transaction. Immediately upon   the occurrence of any such event or condition contemplated by Section Sections   8.04(a), (b), (c), (d) and (e) of the Supplemental Indenture, Counterparty   shall notify the Calculation Agent of such event or condition; and once the   adjustments to be made to the terms of the Indenture and the Convertible   Notes in respect of such event or condition have been determined,   Counterparty shall immediately notify the Calculation Agent in writing of the   details of such adjustments; provided   that, notwithstanding the foregoing, if any Potential Adjustment Event occurs   during the Settlement Averaging Period but no adjustment was made to any   Convertible Note under the Indenture because the relevant “Holder” (as   defined in the Indenture) was deemed to be a record owner of the underlying   Shares on the related Conversion Date, then the Calculation Agent shall make   an adjustment, as determined by it, to the terms hereof in order to account   for such Potential Adjustment Event.
    
	
 
    	
 
    	
 
    
	
Extraordinary   Events:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Merger   Events:
    	
 
    	
Notwithstanding   Section 12.1(b) of the Equity Definitions, a “Merger Event” means the   occurrence of any event or condition set forth in Section 8.07(a) of the   Supplemental Indenture.
    
	
 
    	
 
    	
 
    
	
Consequences   of Merger Events:
    	
 
    	
Notwithstanding   Sections 12.2 and 12.3 of the Equity Definitions, upon the occurrence of a   Merger Event that results in an adjustment under the Indenture, the   Calculation Agent shall make a corresponding adjustment to the terms relevant   to the exercise, settlement or payment of the Transaction; provided that such adjustment shall be   made without regard to any adjustment to the Conversion Rate pursuant to   Section 8.03 or 8.04(h)  of the   Supplemental Indenture; and provided   further that the Calculation Agent may limit or alter any such   adjustment referenced in this paragraph so that the fair value of the   Transaction to Dealer (taking into account a commercially reasonable hedge   position) is not adversely affected as a result of such adjustment; and provided further that if, with respect   to a Merger Event, (i) the consideration for the Shares includes (or, at the   option of a holder of Shares, may include) shares of an entity or person that   is not a corporation organized under the laws of the United States, any State   thereof or the District of Columbia or (ii) the Counterparty following such
    

 

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Merger   Event will not be a corporation organized under the laws of the United   States, any State thereof or the District of Columbia or will not be the   Issuer following such Merger Event, Cancellation and Payment (Calculation Agent   Determination) may apply at the sole election of Dealer.
    
	
 
    	
 
    	
 
    
	
Notice   of Merger Consideration:
    	
 
    	
Upon   the occurrence of a Merger Event that causes the Shares to be converted into   the right to receive more than a single type of consideration (determined based   in part upon any form of stockholder election), Counterparty shall reasonably   promptly (but, in any event prior to the effective time of such Merger Event)   notify the Calculation Agent of (i) the weighted average of the types and   amounts of consideration received by the holders of Shares entitled to   receive cash, securities or other property or assets with respect to or in   exchange for such Shares in any Merger Event who affirmatively make such an   election and (ii) the details of the adjustment made under the Indenture in   respect of such Merger Event.
    
	
 
    	
 
    	
 
    
	
Nationalization,   Insolvency or Delisting:
    	
 
    	
Cancellation   and Payment (Calculation Agent Determination); provided that, in addition to the provisions of Section 12.6(a)(iii)   of the Equity Definitions, it 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   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 thereafter be deemed to be the Exchange.
    
	
 
    	
 
    	
 
    
	
Additional   Disruption Events:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
(a)  Change in Law:
    	
 
    	
Applicable;   provided that Section 12.9(a)(ii) is   hereby amended by (x) adding the words “(including, for the avoidance of   doubt and without limitation, adoption or promulgation of new regulations   authorized or mandated by existing statute)” after the word “regulation” in   the second line thereof, (y) adding the words “or any Hedge Positions” after   the word “Shares” in the clause (X) thereof and (z) adding the words “, or   holding, acquiring or disposing of Shares or any Hedge Positions relating,”   after the word “obligations” in clause (Y) thereof.
    
	
 
    	
 
    	
 
    
	
(b)  Failure to Deliver:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
(c)  Insolvency Filing:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
(d)  Hedging Disruption:
    	
 
    	
Applicable;   provided that:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(i)   Section 12.9(a)(v) of the Equity Definitions is hereby modified by inserting   the following two phrases at the end of such Section:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
“For   the avoidance of doubt, the term “equity price risk” shall be deemed to   include, but shall not be limited to, stock price and volatility risk. And,   for the further avoidance of doubt, any such transactions or assets referred   to in phrases (A) or (B) above must be available on commercially reasonable   pricing terms.”; and
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(ii)   Section 12.9(b)(iii) of the Equity Definitions is hereby amended by inserting   in the third line thereof, after the words “to terminate the Transaction”,   the words “or a portion of the
    

 

9

 

	
 
    	
 
    	
Transaction   affected by such Hedging Disruption”.
    
	
 
    	
 
    	
 
    
	
(e)          Increased Cost of Hedging:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
Hedging   Party:
    	
 
    	
For   all applicable Potential Adjustment Events and Extraordinary Events, Dealer
    
	
 
    	
 
    	
 
    
	
Determining   Party:
    	
 
    	
For   all applicable Extraordinary Events, Dealer
    
	
 
    	
 
    	
 
    
	
Non-Reliance:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
Agreements   and Acknowledgments Regarding Hedging Activities:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
Additional   Acknowledgments:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
3.               Calculation Agent:
    	
 
    	
Dealer
    
	
 
    	
 
    	
 
    
	
4.               Account Details:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Dealer   Payment Instructions:
    	
 
    	
To   be provided by Dealer
    
	
 
    	
 
    	
 
    
	
Counterparty Payment Instructions:
    	
 
    	
To be provided by Counterparty.
    
	
 
    	
 
    	
 
    
	
5.               Offices:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
The Office of Dealer for the Transaction is: New   York
    
	
 
    
	
The Office of Counterparty for the Transaction is:   Not applicable
    
	
 
    	
 
    	
 
    
	
6.               Notices:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Address for notices or   communications to Counterparty for purposes of this Confirmation:
    
	
 
    	
 
    	
 
    

 

	
To:
    	
GT   Advanced Technologies Inc.
    
	
 
    	
20   Trafalgar Square
    
	
 
    	
Nashua,   NH 03063
    
	
Attn:
    	
Hoil   Kim, General Counsel
    
	
Telephone:
    	
(603)   883-5200
    

 

Address for notices or communications to Dealer for purposes of this Confirmation:

 

	
To:
    	
Credit Suisse International
    
	
 
    	
c/o Credit Suisse AG, New York Branch
    
	
 
    	
Eleven Madison Avenue
    
	
 
    	
New York, NY 10010-3629
    
	
Attn:
    	
John Carr
    
	
Telephone:
    	
212-325-2130
    
	
Facsimile:
    	
212-325-5338
    

 

7.               Representations, Warranties and Agreements:

 

(a)                                  In addition to the representations and warranties in the Agreement and those contained elsewhere herein, Counterparty represents and warrants to and for the benefit of, and agrees with, Dealer as of the date hereof (unless otherwise specified) that:

 

(i)                                     On the Trade Date, and as of any date on which Counterparty gives Dealer a Notice of Cash Payment Termination under (and as defined in) Section 8(b) below, (A) none of Counterparty and its officers and directors is aware of any material nonpublic information regarding Counterparty or the Shares and (B) all reports and other documents filed by Counterparty with the Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”) when considered as a whole (with the more recent such reports and documents deemed to amend inconsistent statements contained in any earlier such reports and documents), do not contain any untrue statement of a material fact or any omission of a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances in which they were made, not misleading.

 

10

 

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

 

(iii)                               Without limiting the generality of Section 13.1 of the Equity Definitions, Counterparty acknowledges that Dealer is not making any representations or warranties or taking any position or expressing any view with respect to the treatment of the 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 (or any successor issue statements) or under FASB’s Liabilities & Equity Project.

 

(iv)                              Without limiting the generality of Section 3(a)(iii) of the Agreement, the Transaction will not violate Rule 13e-1 or Rule 13e-4 under the Exchange Act.

 

(v)                                 Prior to the Trade Date, Counterparty shall deliver to Dealer a resolution of Counterparty’s board of directors authorizing the Transaction and such other certificate or certificates as Dealer shall reasonably request.

 

(vi)                              Counterparty is not entering into this Confirmation to create actual or apparent trading activity in the Shares (or any security convertible into or exchangeable for Shares) or to raise or depress or otherwise manipulate the price of the Shares (or any security convertible into or exchangeable for Shares) or otherwise in violation of the Exchange Act.

 

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

 

(viii)                        On each of the Trade Date and the Premium Payment Date, Counterparty is not, or will not be, “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 the Shares hereunder in compliance with the laws of the jurisdiction of its incorporation.

 

(ix)                                No state law, rule, regulation or regulatory order applicable to the Shares would give rise to any reporting, consent, registration or other requirement (including without limitation a requirement to obtain prior approval from any person or entity) as a result of Dealer or its affiliates owning or holding (however defined) Shares, other than any reporting requirement imposed by Section 13 or 16 of the Exchange Act.

 

(x)                                   The representations and warranties of Counterparty set forth in Section 3 of the Agreement and Section 3 of the Underwriting Agreement, dated September 24, 2012 (the “Underwriting Agreement”), among the Counterparty, UBS Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representatives of the Underwriters party thereto, are true and correct and are hereby deemed to be repeated to Dealer as if set forth herein.

 

(xi)                                Counterparty understands no obligations of Dealer to it hereunder will be entitled to the benefit of deposit insurance and that such obligations will not be guaranteed by any affiliate of Dealer or any governmental agency.

 

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

 

(b)                                 Each of Dealer and Counterparty agrees and represents that it is an “eligible contract participant” as defined in the U.S. Commodity Exchange Act, as amended.

 

(c)                                  Each of Dealer and Counterparty acknowledges that the offer and sale of the Transaction to it is intended to be exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”), by virtue of Section 4(2) thereof.  Accordingly, Counterparty represents and warrants to Dealer that (i) it has the financial ability

 

11

 

to bear the economic risk of its investment in the Transaction and is able to bear a total loss of its investment, (ii) it is an “accredited investor” as that term is defined in Regulation D as promulgated under the Securities Act, (iii) it is entering into the Transaction for its own account and without a view to the distribution or resale thereof and (iv) the assignment, transfer or other disposition of the Transaction has not been and will not be registered under the Securities Act and is restricted under this Confirmation, the Securities Act and state securities laws.

 

(d)                                 Counterparty agrees and acknowledges that Dealer is a “financial institution,”  “swap participant” and “financial participant” within the meaning of Sections 101(22), 101(53C) and 101(22A) of the Bankruptcy Code.  The parties hereto further agree and acknowledge that it is the intent of the parties that (A) this Confirmation is (i) a “securities contract,” as such term is defined in Section 741(7) of the Bankruptcy Code, with respect to which each payment and delivery hereunder or in connection herewith is a “termination value,” “payment amount” or “other transfer obligation” within the meaning of Section 362 of the Bankruptcy Code and a “settlement payment,” within the meaning of Section 546 of the Bankruptcy Code and (ii) a “swap agreement,” as such term is defined in Section 101(53B) of the Bankruptcy Code, with respect to which each payment and delivery hereunder or in connection herewith is a “termination value,” “payment amount” or “other transfer obligation” within the meaning of Section 362 of the Bankruptcy Code and a “transfer,” as such term is defined in Section 101(54) of the Bankruptcy Code and a “payment or other transfer of property” within the meaning of Sections 362 and 546 of the Bankruptcy Code, and (B) Dealer is entitled to the protections afforded by, among other sections, Sections 362(b)(6), 362(b)(17), 362(o), 546(e), 546(g), 548(d)(2), 555, 560 and 561 of the Bankruptcy Code.

 

(e)                                  Counterparty shall deliver to Dealer an opinion of counsel, dated as of the Effective Date and reasonably acceptable to Dealer in form and substance, with respect to the matters set forth in Section 3(a) of the Agreement.

 

8.               Other Provisions:

 

(a)                                  Additional Termination Events.  The occurrence of (i) an “Event of Default” with respect to Counterparty under the terms of the Convertible Notes as set forth in Section 5.02 of the Supplemental Indenture or (ii) an Amendment Event shall be an Additional Termination Event with respect to which the Transaction is the sole Affected Transaction and Counterparty is the sole Affected Party and Dealer shall be the party entitled to designate an Early Termination Date pursuant to Section 6(b) of the Agreement.

 

“Amendment Event” means that Counterparty amends, modifies, supplements, waives or obtains a waiver in respect of any term of the Indenture or the Convertible Notes governing the principal amount, coupon, maturity, repurchase obligation of Counterparty, redemption right of Counterparty, any term relating to conversion of the Convertible Notes (including changes to the conversion price, conversion settlement dates or conversion conditions), or any term that would require consent of the holders of not less than 100% of the principal amount of the Convertible Notes to amend, in each case without the consent of Dealer.

 

(b)                                 Alternative Calculations and Payment on Early Termination and on Certain Extraordinary Events.  If Dealer shall owe Counterparty any amount pursuant to “Consequences of Merger Events” above or Sections 12.6, 12.7 or 12.9 of the Equity Definitions or pursuant to Section 6(d)(ii) of the Agreement (a “Payment Obligation”), Dealer shall satisfy any such Payment Obligation by the Share Termination Alternative (as defined below), unless (a) Counterparty gives irrevocable telephonic notice to Dealer, confirmed in writing within one Scheduled Trading Day, no later than 9:30 A.M., New York City time, on the Scheduled Trading Day immediately following the relevant merger date, Announcement Date, Early Termination Date or date of cancellation or termination in respect of an Extraordinary Event, as applicable, of its election that the Share Termination Alternative shall not apply (“Notice of Cash Payment Termination”) and (b) Dealer agrees, in its sole discretion, to such election, in which case the provisions of “Consequences of Merger Events” above, Sections 12.6, 12.7 or 12.9 of the Equity Definitions or Section 6(d)(ii) of the Agreement, as the case may be, shall apply.  If the Share Termination Alternative applies, the following provisions shall apply on the Scheduled Trading Day immediately following the relevant merger date, Announcement Date, Early Termination Date or date of cancellation or termination in respect of an Extraordinary Event, as applicable:

 

	
Share Termination Alternative:
    	
Applicable   and means that Dealer shall deliver to Counterparty the Share Termination   Delivery Property on the date on which the Payment Obligation would otherwise   be due pursuant to “Consequences of Merger Events” above, Section 12.7 or   12.9 of the Equity Definitions or Section 6(d)(ii) of the Agreement, as   applicable, or such later date as the Calculation Agent may reasonably   determine (the “Share Termination   Payment Date”), in satisfaction of the Payment Obligation.
    

 

12

 

	
Share   Termination Delivery Property:
    	
A   number of Share Termination Delivery Units, as calculated by the Calculation   Agent, equal to the Payment Obligation divided by   the Share Termination Unit Price. The Calculation Agent shall adjust the   Share Termination Delivery Property by replacing any fractional portion of   the aggregate amount of a security therein with an amount of cash equal to   the value of such fractional security based on the values used to calculate   the Share Termination Unit Price.
    
	
 
    	
 
    
	
Share   Termination Unit Price:
    	
The   value of property contained in one Share Termination Delivery Unit on the   date such Share Termination Delivery Units are to be delivered as Share   Termination Delivery Property, as determined by the Calculation Agent in its   discretion by commercially reasonable means and notified by the Calculation   Agent to Dealer at the time of notification of the Payment Obligation.
    
	
 
    	
 
    
	
Share   Termination Delivery Unit:
    	
In   the case of a Termination Event, Event of Default, Delisting or Additional   Disruption Event, one Share or, in the case of an Insolvency, Nationalization   or Merger Event, one Share or a unit consisting of the number or amount of   each type of property received by a holder of one Share (without   consideration of any requirement to pay cash or other consideration in lieu   of fractional amounts of any securities) in such Insolvency, Nationalization   or Merger Event, as applicable. If such Insolvency, Nationalization or 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.
    
	
 
    	
 
    
	
Failure   to Deliver:
    	
Applicable
    
	
 
    	
 
    
	
Other   applicable provisions:
    	
If   Share Termination Alternative is applicable, the provisions of Sections 9.8,   9.9, 9.10 and 9.11 (except that the Representation and Agreement contained in   Section 9.11 of the Equity Definitions shall be modified by excluding any   representations therein relating to restrictions, obligations, limitations or   requirements under applicable securities laws arising as a result of the fact   that Counterparty is the issuer of the Shares or any portion of the Share   Termination Delivery Units) of the Equity Definitions will be applicable as   if “Physical Settlement” applied to the Transaction, except that all   references to “Shares” shall be read as references to “Share Termination   Delivery Units.”
    

 

(c)                                  Disposition of Hedge Shares.  Counterparty hereby agrees that if, in the good faith reasonable judgment of Dealer, any Shares (the “Hedge Shares”) acquired by Dealer for the purpose of hedging its obligations pursuant to the Transaction cannot be sold in the public market by Dealer without registration under the Securities Act, Counterparty shall, at its election: (i) in order to allow Dealer to sell the Hedge Shares in a registered offering, make available to Dealer an effective registration statement under the Securities Act to cover the resale of such Hedge Shares and (A) enter into an agreement, in form and substance satisfactory to Dealer, substantially in the form of an underwriting agreement for a registered offering, (B) provide accountant’s “comfort” letters in customary form for registered offerings of equity securities, (C) provide disclosure opinions of nationally recognized outside counsel to Counterparty reasonably acceptable to Dealer, (D) provide other customary opinions, certificates and closing documents customary in form for registered offerings of equity securities and (E) afford Dealer a reasonable opportunity to conduct a “due diligence” investigation with respect to Counterparty customary in scope for underwritten offerings of equity securities (provided, however, that if Dealer, in its sole reasonable discretion, is not satisfied with access to due diligence materials, the results of its due diligence investigation, or the procedures and documentation for the registered offering referred to above, then clause (ii) or clause (iii) of this Section 8(c) shall apply at the election of Counterparty); (ii) in order to allow Dealer to sell the Hedge Shares in a private placement, enter into a private placement agreement substantially similar to private placement purchase agreements customary for private placements of equity securities, in form and substance satisfactory to Dealer, including customary representations, covenants, blue sky and other governmental filings and/or registrations, indemnities to Dealer, due diligence rights (for Dealer or any designated buyer of the Hedge Shares from Dealer), opinions and certificates and such other documentation as is customary for private placements agreements, all reasonably acceptable to Dealer (in which case, the Calculation Agent shall make any adjustments to the terms of the Transaction that are necessary, in its reasonable judgment, to compensate Dealer for any discount from the public market price of the Shares incurred on the sale of Hedge Shares in a private placement); or (iii)

 

13

 

purchase the Hedge Shares from Dealer at the Relevant Price on such Exchange Business Days, and in the amounts, requested by Dealer.

 

(d)                                 Amendment to Equity Definitions.  The following amendment shall be made to the Equity Definitions:

 

Section 12.6(a)(ii) of the Equity Definitions is hereby amended by (1) deleting from the fourth line thereof the word “or” after the word “official” and inserting a comma therefor, and (2) deleting the semi-colon at the end of subsection (B) thereof and inserting the following words therefor “or (C) at Dealer’s option, the occurrence of any of the events specified in Section 5(a)(vii)(1) through (9) of the ISDA Master Agreement with respect to that Issuer.”

 

(e)                                  Repurchase and Conversion Rate Adjustment Notices.  Counterparty shall, at least 10 Scheduled Trading Days prior to effecting any repurchase of Shares or consummating or otherwise executing or engaging in any transaction or event (a “Conversion Rate Adjustment Event”) that would lead to an increase in the Conversion Rate (as such term is defined in the Indenture), give Dealer a written notice of such repurchase or Conversion Rate Adjustment Event (a “Repurchase Notice”) if, following such repurchase or Conversion Rate Adjustment Event, the Notice Percentage as determined on the date of such Repurchase Notice is (i) greater than 4.5% and (ii) greater by 0.5% than the Notice Percentage included in the immediately preceding Repurchase Notice (or, in the case of the first such Repurchase Notice, greater than the Notice Percentage as of the date hereof), and, if such repurchase or Conversion Rate Adjustment Event, or the intention to effect the same, would constitute material non-public information with respect to Counterparty or the Shares, Counterparty shall make public disclosure thereof at or prior to delivery of such Repurchase Notice.  The “Notice Percentage” as of any day is the fraction, expressed as a percentage, the numerator of which is the Number of Shares and the denominator of which is the number of Shares outstanding on such day.  In the event that Counterparty fails to provide Dealer with a Repurchase Notice on the day and in the manner specified in this Section 8(e) then Counterparty agrees to indemnify and hold harmless Dealer, its affiliates and their respective directors, officers, employees, agents and controlling persons (Dealer and each such person being an “Indemnified Party”) from and against any and all losses, claims, damages and liabilities (or actions in respect thereof), joint or several, to which such Indemnified Party may become subject under applicable securities laws, including without limitation, Section 16 of the Exchange Act, relating to or arising out of such failure.  If for any reason the foregoing indemnification is unavailable to any Indemnified Party or insufficient to hold harmless any Indemnified Party, then Counterparty shall contribute, to the maximum extent permitted by law, to the amount paid or payable by the Indemnified Party as a result of such loss, claim, damage or liability.  In addition, Counterparty will reimburse any Indemnified Party for all expenses (including reasonable counsel fees and expenses) as they are incurred (after notice to Counterparty) in connection with the investigation of, preparation for or defense or settlement of any pending or threatened claim or any action, suit or proceeding arising therefrom, whether or not such Indemnified Party is a party thereto and whether or not such claim, action, suit or proceeding is initiated or brought by or on behalf of Counterparty.  This indemnity shall survive the completion of the Transaction contemplated by this Confirmation and any assignment and delegation of the Transaction made pursuant to this Confirmation or the Agreement shall inure to the benefit of any permitted assignee of Dealer.

 

(f)                                    Transfer and Assignment.  Either party may transfer any of its rights or obligations under the Transaction with the prior written consent of the non-transferring party, such consent not to be unreasonably withheld or delayed. For the avoidance of doubt, Dealer may condition its consent on any of the following, without limitation: (i) the receipt by Dealer of opinions and documents reasonably satisfactory to Dealer in connection with such assignment, (ii) such assignment being effected on terms reasonably satisfactory to Dealer with respect to any legal and regulatory requirements relevant to Dealer, and (iii) Counterparty continuing to be obligated to provide notices hereunder relating to the Convertible Notes and continuing to be obligated with respect to “Disposition of Hedge Shares” and “Repurchase Notices” above.  In addition, Dealer may transfer or assign without any consent of the Counterparty its rights and obligations hereunder and under the Agreement, in whole or in part, to (i) any of its affiliates, (ii) any entities sponsored or organized by, or on behalf of or for the benefit of Dealer or (iii) any person of credit quality equivalent to Dealer.  At any time at which any Excess Ownership Position or a Hedging Disruption exists, if Dealer, in its discretion, is unable to effect a transfer or assignment to a third party in accordance with the requirements set forth above after using its commercially reasonable efforts on pricing terms and within a time period reasonably acceptable to Dealer such that an Excess Ownership Position or a Hedging Disruption, as the case may be, no longer exists, Dealer may designate any Scheduled Trading Day as an Early Termination Date with respect to a portion (the “Terminated Portion”) of the Transaction, such that such Excess Ownership Position or Hedging Disruption, as the case may be, no longer exists. In the event that Dealer so designates an Early Termination Date with respect to a portion of the Transaction, a payment or delivery shall be made pursuant to Section 6 of the Agreement and Section 8(b) of this Confirmation as if (i) an Early Termination Date had been designated in respect of a Transaction having terms identical to the Terminated Portion of the

 

14

 

Transaction, (ii) Counterparty shall be the sole Affected Party with respect to such partial termination and (iii) such portion of the Transaction shall be the only Terminated Transaction. “Excess Ownership Position” means any of the following: (i) the Equity Percentage exceeds 7.5%, (ii) Dealer or any “affiliate” or “associate” of Dealer would own in excess of 13% of the outstanding Shares for purposes of Section 203 of the Delaware General Corporation Law or (iii) Dealer, Dealer Group (as defined below) or any person whose ownership position would be aggregated with that of Dealer or Dealer Group (Dealer, Dealer Group or any such person, a “Dealer Person”) under any federal, state or local laws, regulations, regulatory orders or organizational documents or contracts of Counterparty that are, in each case, applicable to ownership of Shares (“Applicable Laws”), owns, beneficially owns, constructively owns, controls, holds the power to vote or otherwise meets a relevant definition of ownership in excess of a number of Shares equal to (x) the number of Shares that would give rise to reporting or registration obligations or other requirements (including obtaining prior approval by a state or federal regulator) of a Dealer Person, or could result in an adverse effect on a Dealer Person, under Applicable Laws, as determined by Dealer in its reasonable discretion, and with respect to which such requirements have not been met or the relevant approval has not been received or that would give rise to any consequences under the constitutive documents of Counterparty or any contract or agreement to which Counterparty is a party, in each case minus (y) 1% of the number of Shares outstanding on the date of determination.  The “Equity Percentage” as of any day is the fraction, expressed as a percentage, (A) the numerator of which is the number of Shares that Dealer and any of its affiliates or any other person subject to aggregation with Dealer, for purposes of the “beneficial ownership” test under Section 13 of the Exchange Act, or any “group” (within the meaning of Section 13) of which Dealer is or may be deemed to be a part (Dealer and any such affiliates, persons and groups, collectively, “Dealer Group”) beneficially owns (within the meaning of Section 13 of the Exchange Act), without duplication, on such day (or, to the extent that, as a result of a change in law, regulation or interpretation after the date hereof, the equivalent calculation under Section 16 of the Exchange Act and the rules and regulations thereunder results in a higher number, such number) and (B) the denominator of which is the number of Shares outstanding on such day.

 

(g)                                 Staggered Settlement.  Dealer may, by notice to Counterparty on or prior to any Settlement Date (a “Nominal Settlement Date”), elect to deliver any Shares deliverable hereunder on two or more dates (each, a “Staggered Settlement Date”) or at two or more times on the Nominal Settlement Date as follows:

 

(i)                                     in such notice, Dealer will specify to Counterparty the related Staggered Settlement Dates (each of which will be on or prior to such Nominal Settlement Date, but not prior to the beginning of the related Settlement Averaging Period) or delivery times and how it will allocate the Shares it is required to deliver hereunder among the Staggered Settlement Dates or delivery times;

 

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

 

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

 

(h)                                 Right to Extend.  Dealer may postpone any Exercise Date or Settlement Date or any other date of valuation or delivery by Dealer, with respect to some or all of the relevant Options (in which event the Calculation Agent shall make appropriate adjustments to the Delivery Obligation), if Dealer determines, in its reasonable discretion, that such extension is reasonably necessary or appropriate to (i) preserve Dealer’s hedging or hedge unwind activity hereunder in light of existing liquidity conditions in the cash market, the stock loan market or any other relevant market or (ii) to enable Dealer to effect purchases of Shares in connection with its hedging, hedge unwind or settlement activity hereunder in a manner that would, if Dealer were Counterparty or an affiliated purchaser of Counterparty, be in compliance with applicable legal, regulatory or self-regulatory requirements, or with related policies and procedures applicable to Dealer.

 

(i)                                     Adjustments.  For the avoidance of doubt, whenever the Calculation Agent is called upon to make an adjustment pursuant to the terms of this Confirmation or the Definitions to take into account the effect of an event, the Calculation Agent shall make such adjustment by reference to the effect of such event on the Hedging Party, assuming that the Hedging Party maintains a commercially reasonable hedge position.

 

(j)                                     Disclosure.  Effective from the date of commencement of discussions concerning the Transaction,

 

15

 

Counterparty and each of its employees, representatives, or other agents may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the Transaction and all materials of any kind (including opinions or other tax analyses) that are provided to Counterparty relating to such tax treatment and tax structure.

 

(k)                                  Designation by Dealer.  Notwithstanding any other provision in this Confirmation to the contrary requiring or allowing Dealer to purchase, sell, receive or deliver any Shares or other securities to or from Counterparty, Dealer may designate any of its affiliates to purchase, sell, receive or deliver such shares or other securities and otherwise to perform Dealer obligations in respect of the Transaction and any such designee may assume such obligations.  Dealer shall be discharged of its obligations to Counterparty to the extent of any such performance.

 

(l)                                     No Netting and Set-off.  Each party waives any and all rights it may have to set off obligations arising under the Agreement and the Transaction against other obligations between the parties, whether arising under any other agreement, applicable law or otherwise.

 

(m)                               Equity Rights.  Dealer acknowledges and agrees that this Confirmation is not intended to convey to it rights with respect to the Transaction that are senior to the claims of common stockholders in the event of Counterparty’s bankruptcy.  For the avoidance of doubt, the parties agree that the preceding sentence shall not apply at any time other than during Counterparty’s bankruptcy to any claim arising as a result of a breach by Counterparty of any of its obligations under this Confirmation or the Agreement.  For the avoidance of doubt, the parties acknowledge that this Confirmation is not secured by any collateral that would otherwise secure the obligations of Counterparty herein under or pursuant to any other agreement.

 

(n)                                 Early Unwind.  In the event the sale by Counterparty of the Convertible Notes is not consummated with the initial purchasers pursuant to the Underwriting Agreement for any reason by the close of business in New York on September 28, 2012 (or such later date as agreed upon by the parties) (September 28, 2012 or such later date being the “Early Unwind Date”), the Transaction shall automatically terminate (the “Early Unwind”), on the Early Unwind Date and (i) the Transaction and all of the respective rights and obligations of Dealer and Counterparty thereunder shall be cancelled and terminated and (ii) Counterparty shall pay to Dealer an amount in cash equal to the aggregate amount of costs and expenses relating to the unwinding of Dealer’s hedging activities in respect of the Transaction (including market losses incurred in reselling any Shares purchased by Dealer or its affiliates in connection with such hedging activities).  Following such termination, cancellation and payment, each party shall be released and discharged by the other party from and agrees not to make any claim against the other party with respect to any obligations or liabilities of either party arising out of and to be performed in connection with the Transaction either prior to or after the Early Unwind Date.  Dealer and Counterparty represent and acknowledge to the other that upon an Early Unwind and following the payment referred to above, all obligations with respect to the Transaction shall be deemed fully and finally discharged.

 

(o)                                 Wall Street Transparency and Accountability Act of 2010.  The parties hereby agree that none of (v) Section 739 of the Wall Street Transparency and Accountability Act of 2010 (“WSTAA”), (w) any similar legal certainty provision in any legislation enacted, or rule or regulation promulgated, on or after the Trade Date, (x) the enactment of WSTAA or any regulation under the WSTAA, (y) any requirement under WSTAA nor (z) an amendment made by WSTAA, shall limit or otherwise impair either party’s rights to terminate, renegotiate, modify, amend or supplement this Confirmation or the Agreement, as applicable, arising from a termination event, force majeure, illegality, increased costs, regulatory change or similar event under this Confirmation, the Equity Definitions incorporated herein, or the Agreement (including, but not limited to, rights arising from Change in Law, Hedging Disruption, Increased Cost of Hedging, an Excess Ownership Position or Illegality (as defined in the Agreement)).

 

(p)                                 Waiver of Trial by Jury.  EACH OF COUNTERPARTY AND DEALER 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 TRANSACTION OR THE ACTIONS OF DEALER OR ITS AFFILIATES IN THE NEGOTIATION, PERFORMANCE OR ENFORCEMENT HEREOF.

 

(q)                                 Governing Law; Jurisdiction.  THIS CONFIRMATION AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO THIS CONFIRMATION SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.  THE PARTIES HERETO IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND THE UNITED STATES COURT FOR THE SOUTHERN DISTRICT OF NEW YORK IN CONNECTION WITH ALL

 

16

 

MATTERS RELATING HERETO AND WAIVE ANY OBJECTION TO THE LAYING OF VENUE IN, AND ANY CLAIM OF INCONVENIENT FORUM WITH RESPECT TO, THESE COURTS.

 

(r)                                    Role of Agent.  Credit Suisse AG, New York branch, in its capacity as Agent will be responsible for (A) effecting the Transaction, (B) issuing all required confirmations and statements to Dealer and Counterparty, (C) maintaining books and records relating to the Transaction in accordance with its standard practices and procedures and in accordance with applicable law and (D) unless otherwise requested by Counterparty, receiving, delivering, and safeguarding Counterparty’s funds and any securities in connection with the Transaction, in accordance with its standard practices and procedures and in accordance with applicable law.

 

(i)             Agent is acting in connection with the Transaction solely in its capacity as Agent for CSI and Counterparty pursuant to instructions from Dealer and Counterparty.  Agent shall have no responsibility or personal liability to Dealer or Counterparty arising from any failure by Dealer or Counterparty to pay or perform any obligations hereunder, or to monitor or enforce compliance by Dealer or Counterparty with any obligation hereunder, including, without limitation, any obligations to maintain collateral.  Each of Dealer and Counterparty agrees to proceed solely against the other to collect or recover any securities or monies owing to it in connection with or as a result of the Transaction.  Agent shall otherwise have no liability in respect of the Transaction, except for its gross negligence or willful misconduct in performing its duties as Agent.

 

(ii)          Any and all notices, demands, or communications of any kind relating to the Transaction between Dealer and Counterparty shall be transmitted exclusively through Agent at the following address:

 

Credit Suisse AG, New York branch
 Eleven Madison Avenue
 New York, NY 10010-3629

 

For payments and deliveries:
 Facsimile No.: (212) 325 8175
 Telephone No.: (212) 325 8678 / (212) 325 3213

 

For all other communications:
 Facsimile No.: (212) 325 8173
 Telephone No.: (212) 325 8676 / (212) 538 5306 / (212) 538 1193 / (212) 538 6886

 

(iii)       The date and time of the Transaction evidenced hereby will be furnished by the Agent to Dealer and Counterparty upon written request.

 

(iv)       The Agent will furnish to Counterparty upon written request a statement as to the source and amount of any remuneration received or to be received by the Agent in connection with the Transaction evidenced hereby.

 

(v)         Dealer and Counterparty each represents and agrees (A) that the Transaction is not unsuitable for it in the light of such party’s financial situation, investment objectives and needs and (B) that it is entering into the Transaction in reliance upon such tax, accounting, regulatory, legal and financial advice as it deems necessary and not upon any view expressed by the other or the Agent.

 

(vi)       Dealer is regulated by The Securities and Futures Authority and has entered into the Transaction as principal. The time at which the Transaction was executed will be notified to Counterparty (through the Agent) on request.

 

(s)                                  Agreements and Acknowledgements Regarding Hedging.  Counterparty understands, acknowledges and agrees that: (A) at any time on and prior to the last Valid Day of the last Settlement Averaging Period, Dealer and its affiliates may buy or sell Shares or other securities or buy or sell options or futures contracts or enter into swaps or other derivative securities in order to adjust its hedge position with respect to the Transaction; (B) Dealer and its affiliates also may be active in the market for Shares other than in connection with hedging activities in relation to the Transaction; (C) Dealer shall make its own determination as to whether, when or in what manner any hedging or market activities in securities of Counterparty shall be conducted and shall do so in a manner that it deems appropriate to hedge its price and

 

17

 

market risk with respect to the Relevant Prices; and (D) any market activities of Dealer and its affiliates with respect to Shares may affect the market price and volatility of Shares, as well as the Relevant Prices, each in a manner that may be adverse to Counterparty.

 

(t)                                    Additional Termination Event for Conversions in Connection with a Make-Whole Fundamental Change.  Notwithstanding anything to the contrary in this Confirmation, the receipt by Dealer from Counterparty, within the applicable time period set forth under “Notice of Exercise” above, of any Notice of Exercise in respect of Options that relate to Convertible Notes as to which additional Shares would be added to the Conversion Rate pursuant to Section 8.03 of the Supplemental Indenture in connection with a “Make-Whole Fundamental Change” (as defined in the Indenture) shall constitute an Additional Termination Event hereunder.  Upon receipt of any such Notice of Exercise, Dealer shall designate an Exchange Business Day following such Additional Termination Event (which Exchange Business Day shall in no event be earlier than the related settlement date for such Convertible Notes) as an Early Termination Date with respect to the portion of this Transaction corresponding to a number of Options (the “Make-Whole Conversion Options”) equal to the lesser of (A) the number of such Options specified in such Notice of Exercise and (B) the Number of Options as of the date Dealer designates such Early Termination Date and, as of such date, the Number of Options shall be reduced by the number of Make-Whole Conversion Options.  Any payment hereunder with respect to such termination shall be calculated pursuant to Section 6 of the Agreement as if (1) an Early Termination Date had been designated in respect of a Transaction having terms identical to this Transaction and a Number of Options equal to the number of Make-Whole Conversion Options, (2) Counterparty were the sole Affected Party with respect to such Additional Termination Event and (3) the terminated portion of the Transaction were the sole Affected Transaction (and, for the avoidance of doubt, in determining the amount payable pursuant to Section 6 of the Agreement, the Calculation Agent shall not take into account any adjustments to the Option Entitlement that result from corresponding adjustments to the Conversion Rate pursuant to Section 8.03 of the Supplemental Indenture); provided that the amount of cash deliverable in respect of such early termination by Dealer to Counterparty shall not be greater than the product of (x) the Applicable Percentage and (y) the excess of (I) (1) the number of Make-Whole Conversion Options, multiplied by (2) the Conversion Rate (after taking into account any applicable adjustments to the Conversion Rate pursuant to Section 8.03 of the Supplemental Indenture), multiplied by (3) a price per Share determined by the Calculation Agent over (II) the aggregate principal amount of such Convertible Notes, as determined by the Calculation Agent in a commercially reasonable manner.

 

(u)                                 For the avoidance of doubt, any performance by Counterparty of its obligations (including notice obligations) through or by means of Agent shall constitute good performance of Counterparty’s obligations hereunder to Dealer when Counterparty has taken the action necessary to allow Agent to perform or satisfy such obligation on its behalf, notwithstanding whether Dealer actually receives the benefit of such performance; however, for the avoidance of doubt, performance by Dealer of its obligations hereunder (including notice obligations) to Counterparty through or by means of Agent shall only constitute good performance of Dealer’s obligations hereunder to the extent Agent actually performs such obligations.

 

18

 

Please confirm that the foregoing correctly sets forth the terms of our agreement by executing this Confirmation and returning it to us.

 

	
 
    	
Yours   faithfully,
    
	
 
    	
 
    	
 
    
	
 
    	
CREDIT SUISSE INTERNATIONAL
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Shui Wong
    
	
 
    	
 
    	
Name:   Shui Wong
    
	
 
    	
 
    	
Title:   Authorized Signatory
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Bik Kwan Chung
    
	
 
    	
 
    	
Name:   Bik Kwan Chung
    
	
 
    	
 
    	
Title:   Authorized Signatory
    
	
 
    	
 
    	
 
    
	
 
    	
CREDIT   SUISSE AG, NEW YORK BRANCH, as agent
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Michael G. Clark
    
	
 
    	
 
    	
Name:   Michael G. Clark
    
	
 
    	
 
    	
Title:   Managing Director
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Gregory Usherovich
    
	
 
    	
 
    	
Name:   Gregory Usherovich
    
	
 
    	
 
    	
Title:   Director
    

 

 

Agreed and Accepted By:

 

GT ADVANCED TECHNOLOGIES INC.

 

 

	
By:
    	
/s/   Hoil Kim
    	
 
    	
 
    
	
 
    	
Name:   Hoil Kim
    	
 
    	
 
    
	
 
    	
Title:   Vice President, General Counsel & Secretary
    	
 
    	
 
    

 

Signature page to Base Convertible Bond Hedge Transaction

 

 

Annex A

 

Premium:                                                USD13,493,393 (Premium per Option approximately USD65.82).

 

Annex A-1Exhibit 10.4

 

	
 
    	
September 25, 2012
    
	
 
    	
 
    
	
To:
    	
GT Advanced Technologies Inc.
    
	
 
    	
20 Trafalgar Square
    
	
 
    	
Nashua, NH 03063
    
	
 
    	
Attn: Hoil Kim, General Counsel
    
	
 
    	
Telephone: (603) 883-5200
    
	
 
    	
 
    
	
From:
    	
Bank of America, N.A.
    
	
 
    	
c/o Merrill Lynch, Pierce, Fenner & Smith   Incorporated
    
	
 
    	
One Bryant Park
    
	
 
    	
New York, NY 10036
    
	
 
    	
Attn:
    	
John Servidio
    
	
 
    	
Telephone:
    	
646-855-6770
    
	
 
    	
Facsimile:
    	
704-208-2869
    
	
 
    	
 
    
	
Re:
    	
Base Convertible Bond Hedge Transaction
    
	
 
    	
(Transaction   Reference Number:                                         )
    

 

Ladies and Gentlemen:

 

The purpose of this communication (this “Confirmation”) is to set forth the terms and conditions of the above-referenced transaction entered into on the Trade Date specified below (the “Transaction”) between Bank of America, N.A. (“Dealer”) and GT Advanced Technologies Inc. (“Counterparty”).  This communication constitutes a “Confirmation” as referred to in the ISDA Master Agreement specified below.

 

1.               This Confirmation is subject to, and incorporates, the definitions and provisions of the 2006 ISDA Definitions (the “2006 Definitions”) and the definitions and provisions of the 2002 ISDA Equity Derivatives Definitions (the “Equity Definitions”, and together with the 2006 Definitions, the “Definitions”), in each case as published by the International Swaps and Derivatives Association, Inc. (“ISDA”).  In the event of any inconsistency between the 2006 Definitions and the Equity Definitions, the Equity Definitions will govern.  Certain defined terms used herein have the meanings assigned to them in the Indenture to be dated as of September 28, 2012 (the “Base Indenture”), as supplemented by a Supplemental Indenture thereto to be dated as of September 28, 2012 (the “Supplemental Indenture”), between Counterparty and U.S. Bank National Association, as trustee (the Base Indenture as so supplemented, the “Indenture”), relating to the USD205,000,000 aggregate principal amount of 3.00% convertible senior notes due 2017 (the “Convertible Notes”).  In the event of any inconsistency between the terms defined in the Indenture and this Confirmation, this Confirmation shall govern.  For the avoidance of doubt, references herein to sections of the Supplemental Indenture are based on the draft of the Supplemental Indenture most recently reviewed by the parties at the time of execution of this Confirmation. If any relevant sections of the Supplemental Indenture are changed, added or renumbered following execution of this Confirmation but prior to the execution of the Supplemental Indenture, the parties will amend this Confirmation in good faith to preserve the economic intent of the parties based on the draft of the Supplemental Indenture so reviewed.  The parties further acknowledge that references to the Supplemental Indenture herein are references to the Supplemental Indenture as in effect on the date of its execution and if the Supplemental Indenture is amended following its execution, any such amendment will be disregarded for purposes of this Confirmation (other than as provided in Section 8(a) below) unless the parties agree otherwise in writing.

 

This Confirmation evidences a complete and binding agreement between Dealer and Counterparty as to the terms of the Transaction to which this Confirmation relates.  This Confirmation shall be subject to an agreement (the “Agreement”) in the form of the ISDA 2002 Master Agreement as if Dealer and Counterparty had executed an agreement in such form (without any Schedule but with the elections set forth in this Confirmation).  For the avoidance of doubt, the Transaction shall be the only transaction under the Agreement.

 

All provisions contained in, or incorporated by reference to, the Agreement will govern this Confirmation except as expressly modified herein.  In the event of any inconsistency between this Confirmation and either the Definitions or the Agreement, this Confirmation shall govern.

 

 

2.               The Transaction constitutes a Share Option Transaction for purposes of the Equity Definitions.  The terms of the particular Transaction to which this Confirmation relates are as follows:

 

	
General Terms:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Trade   Date:
    	
 
    	
September   25, 2012
    
	
 
    	
 
    	
 
    
	
Effective   Date:
    	
 
    	
The   closing date of the initial issuance of the Convertible Notes.
    
	
 
    	
 
    	
 
    
	
Option   Type:
    	
 
    	
Call
    
	
 
    	
 
    	
 
    
	
Seller:
    	
 
    	
Dealer
    
	
 
    	
 
    	
 
    
	
Buyer:
    	
 
    	
Counterparty
    
	
 
    	
 
    	
 
    
	
Shares:
    	
 
    	
The   common stock of Counterparty, par value USD0.01 per share (Ticker Symbol:   “GTAT”).
    
	
 
    	
 
    	
 
    
	
Number   of Options:
    	
 
    	
The   number of Convertible Notes in denominations of USD1,000 principal amount   issued by Counterparty on the closing date for the initial issuance of the   Convertible Notes.
    
	
 
    	
 
    	
 
    
	
Number   of Shares:
    	
 
    	
As   of any date, the product of   (i) the Number of Options, (ii) the Conversion Rate and   (iii) the Applicable Percentage.
    
	
 
    	
 
    	
 
    
	
Conversion   Rate:
    	
 
    	
As   of any date, the “Conversion Rate” (as defined in the Indenture) as of such   date, but without regard to any adjustments to the “Conversion Rate” pursuant   to Section 8.03 or 8.04(h) of the Supplemental Indenture.
    
	
 
    	
 
    	
 
    
	
Applicable   Percentage:
    	
 
    	
20%
    
	
 
    	
 
    	
 
    
	
Strike   Price:
    	
 
    	
USD7.7090
    
	
 
    	
 
    	
 
    
	
Premium:
    	
 
    	
As   provided in Annex A to this Confirmation.
    
	
 
    	
 
    	
 
    
	
Premium   Payment Date:
    	
 
    	
The   Effective Date
    
	
 
    	
 
    	
 
    
	
Exchange:
    	
 
    	
The   NASDAQ Global Select Market
    
	
 
    	
 
    	
 
    
	
Related   Exchange:
    	
 
    	
All   Exchanges
    
	
 
    	
 
    	
 
    
	
Procedures for Exercise:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Exercise   Dates:
    	
 
    	
Each   Conversion Date.
    
	
 
    	
 
    	
 
    
	
Conversion   Date:
    	
 
    	
Each   “Conversion Date”, as defined in the Indenture, occurring during the period   from and excluding the Trade Date to but excluding the Expiration Date, for   Convertible Notes, each in denominations of USD1,000 principal amount, that   are submitted for conversion on such Conversion Date in accordance with the   terms of the Indenture (such Convertible Notes, the “Relevant Convertible Notes” for such   Conversion Date).
    
	
 
    	
 
    	
 
    
	
Required   Exercise on Conversion Dates:
    	
 
    	
On   each Conversion Date, a number of Options equal to the number of Relevant   Convertible Notes for such Conversion Date in denominations of USD1,000   principal amount shall be automatically exercised.
    
	
 
    	
 
    	
 
    
	
Expiration   Date:
    	
 
    	
The   Scheduled Valid Day immediately preceding the “Maturity Date” (as defined in   the Indenture).
    
	
 
    	
 
    	
 
    
	
Automatic   Exercise:
    	
 
    	
As   provided above under “Required Exercise on Conversion Dates”.
    

 

2

 

	
Exercise   Notice Deadline:
    	
 
    	
In   respect of any exercise of Options hereunder on any Conversion Date, the   Exchange Business Day prior to the first Scheduled Valid Day of the   Settlement Averaging Period relating to the Convertible Notes converted on   the Conversion Date occurring on the relevant Exercise Date; provided that in the case of any exercise of Options   hereunder in connection with the conversion of any Relevant Convertible Notes   on any Conversion Date occurring during the period starting on and including   April 1, 2017 and ending on and including the second Scheduled Valid Day   immediately preceding the “Maturity Date” (as defined in the Indenture) (the   “Final Conversion Period”), the   Exercise Notice Deadline shall be the Exchange Business Day immediately   following such Conversion Date.
    
	
 
    	
 
    	
 
    
	
Notice   of Exercise:
    	
 
    	
Notwithstanding   anything to the contrary in the Equity Definitions or under “Automatic   Exercise” above, Dealer shall have no obligation to make any payment or   delivery in respect of any exercise of Options hereunder unless Counterparty   notifies Dealer in writing prior to 4:00 PM, New York City time, on the Exercise   Notice Deadline in respect of such exercise of (i) the number of Options   being exercised on the relevant Exercise Date, (ii) the scheduled Settlement   Date and the first Scheduled Valid Day of the Settlement Averaging Period,   (iii) the Relevant Settlement Method for such Options, and (iv)  if the settlement method for the Relevant   Convertible Notes is not Settlement in Shares or Settlement in Cash (each as   defined below), the fixed amount of cash per Convertible Note that   Counterparty has elected to deliver to “Holders” (as defined in the   Indenture) of the Relevant Convertible Notes (the “Specified   Cash Amount”); provided that   in the case of any exercise of Options hereunder in connection with the   conversion of any Relevant Convertible Notes on any Conversion Date occurring   during the Final Conversion Period, (A) the contents of such notice shall be   as set forth in clause (i) above and (B) if the Relevant Settlement Method   for such Options is (x) Net Share Settlement and the Specified Cash Amount is   not USD1,000, (y) Cash Settlement or (z) Combination Settlement, Dealer shall   have received a separate notice (the “Notice of Final   Settlement Method”) in respect of all such Convertible Notes   before 4:00 PM, New York City time, on April 1, 2017 specifying the   information required in clauses (iii) and (iv) above. Counterparty   acknowledges its responsibilities under applicable securities laws, and in   particular Section 9 and Section 10(b) of the Exchange Act (as defined below)   and the rules and regulations thereunder, in respect of any election of a   settlement method with respect to the Convertible Notes. For the avoidance of   doubt, if Counterparty fails to give such notice when due in respect of any   exercise of Options hereunder, Dealer’s obligation to make any payment and/or   delivery in respect of such exercise shall be permanently extinguished, and   late notice shall not cure such failure; provided that   notwithstanding the foregoing, such notice (and the related exercise of   Options) shall be effective if given after the Exercise Notice Deadline, but   prior to 4:00 PM, New York City time, on the fifth Exchange Business Day   following the Exercise Notice Deadline, in which event the Calculation Agent   shall have the right to adjust the Delivery Obligation as appropriate to   reflect the additional costs (including, but not limited to,
    

 

3

 

	
 
    	
 
    	
hedging   mismatches and market losses) and expenses incurred by Dealer in connection   with its hedging activities (including the unwinding of any hedge position)   as a result of Dealer not having received such notice on or prior to the   Exercise Notice Deadline.
    
	
 
    	
 
    	
 
    
	
Market   Disruption Event:
    	
 
    	
Section   6.3(a) of the Equity Definitions is hereby replaced in its entirety by the   following:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
“‘Market   Disruption Event’ means, in respect of a Share, (i) a failure by the primary   U.S. national or regional securities exchange or market on which the Shares   are listed or admitted for trading to open for trading during its regular   trading session or (ii) the occurrence or existence prior to 1:00 PM, New   York City time, on any Scheduled Valid Day for the Shares for more than one   half-hour period in the aggregate during regular trading hours of any   suspension or limitation imposed on trading (by reason of movements in price   exceeding limits permitted by the relevant stock exchange or otherwise) in   the Shares or in any options contracts or futures contracts relating to the   Shares.
    
	
 
    	
 
    	
 
    
	
Dealer’s   Telephone Number and Telex and/or Facsimile Number and Contact Details for   purpose of Giving Notice:
    	
 
    	
To   be provided by Dealer.
    
	
 
    	
 
    	
 
    
	
Settlement Terms:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Settlement   Method:
    	
 
    	
For   any Option, Net Share Settlement; provided that   if the Relevant Settlement Method set forth below for such Option is not Net   Share Settlement, then the Settlement Method for such Option shall be such   Relevant Settlement Method, but only if Counterparty shall have notified   Dealer of the Relevant Settlement Method in the Notice of Exercise or Notice   of Final Settlement Method, as applicable, for such Option.
    
	
 
    	
 
    	
 
    
	
Relevant   Settlement Method:
    	
 
    	
In   respect of any Option:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(i)                                     if   Counterparty has elected to settle its conversion obligations in respect of   the Relevant Convertible Note (A) entirely in Shares pursuant to Section 8.02(a)(iv)(A)   of the Supplemental Indenture (together with cash in lieu of fractional   Shares) (such settlement method, “Settlement in Shares”),   (B) in a combination of cash and Shares pursuant to Section 8.02(a)(iv)(C) of   the Supplemental Indenture with a Specified Cash Amount less than USD1,000   (such settlement method, “Low Cash Combination   Settlement”) or (C) in a combination of cash and Shares pursuant   to Section 8.02(a)(iv)(C) of the Supplemental Indenture with a Specified Cash   Amount equal to USD1,000, then, in each case, the Relevant Settlement Method   for such Option shall be Net Share Settlement;
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(ii)                                  if   Counterparty has elected to settle its conversion obligations in respect of   the Relevant Convertible Note in a combination of cash and Shares pursuant to   Section 8.02(a)(iv)(C) of the Supplemental Indenture with a Specified Cash   Amount greater than USD1,000, then the Relevant Settlement Method for such   Option shall be Combination Settlement; and
    

 

4

 

	
 
    	
 
    	
(iii)                               if   Counterparty has elected to settle its conversion obligations in respect of   the Relevant Convertible Note entirely in cash pursuant to Section 8.02(a)(iv)(B)   of the Supplemental Indenture (such settlement method, “Settlement   in Cash”), then the Relevant Settlement Method for such Option   shall be Cash Settlement.
    
	
 
    	
 
    	
 
    
	
Net   Share Settlement:
    	
 
    	
If   Net Share Settlement is applicable to any Option exercised or deemed   exercised hereunder, Dealer will deliver to Counterparty, on the relevant   Settlement Date for each such Option, a number of Shares (the “Net Share Settlement Amount”) equal to the sum, for each   Valid Day during the Settlement Averaging Period for each such Option, of (i)   (a) the Daily Option Value for such Valid Day, divided by   (b) the Relevant Price on such Valid Day, divided by   (ii) the number of Valid Days in the Settlement Averaging Period; provided that in no event shall the Net Share Settlement   Amount for any Option exceed a number of Shares equal to the Applicable Limit   for such Option, divided by   the Applicable Limit Price on the Settlement Date for such Option.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Dealer   will pay cash in lieu of any fractional Shares to be delivered with respect   to any Net Share Settlement Share Amount valued at the Relevant Price for the   last Valid Day of the Settlement Averaging Period.
    
	
 
    	
 
    	
 
    
	
Combination   Settlement:
    	
 
    	
If   Combination Settlement is applicable to any Option exercised or deemed   exercised hereunder, Dealer will deliver to Counterparty, on the relevant   Settlement Date for each such Option:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(i)                                     cash (the “Combination Settlement Cash Amount”) equal to the sum, for   each Valid Day during the Settlement Averaging Period for such Option, of (A)   an amount (the “Daily Combination   Settlement Cash Amount”) equal to the lesser of (1) the product of (x) the Applicable Percentage and (y) the   Specified Cash Amount minus   USD1,000 and (2) the Daily Option Value, divided by   (B) the number of Valid Days in the Settlement Averaging Period; provided that if the calculation in clause (A) above   results in zero or a negative number for any Valid Day, the Daily Combination   Settlement Cash Amount for such Valid Day shall be deemed to be zero; and
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(ii)                                  Shares (the “Combination Settlement Share Amount”) equal to the sum,   for each Valid Day during the Settlement Averaging Period for such Option, of   a number of Shares for such Valid Day (the “Daily   Combination Settlement Share Amount”) equal to (A) (1) the Daily   Option Value on such Valid Day minus the   Daily Combination Settlement Cash Amount for such Valid Day, divided by (2) the Relevant Price on such Valid Day, divided by (B) the number of Valid Days in the Settlement   Averaging Period; provided that   if the calculation in sub-clause (A)(1) above results in zero or a negative   number for any Valid Day, the Daily Combination Settlement Share Amount for   such Valid Day shall be deemed to be zero;
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
provided that in no   event shall the sum of (x) the Combination Settlement Cash Amount for any   Option and (y) the Combination
    

 

5

 

	
 
    	
 
    	
Settlement   Share Amount for such Option multiplied by   the Applicable Limit Price on the Settlement Date for such Option, exceed the   Applicable Limit for such Option.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Dealer   will pay cash in lieu of any fractional Shares to be delivered with respect   to any Combination Settlement Share Amount valued at the Relevant Price for   the last Valid Day of the Settlement Averaging Period.
    
	
 
    	
 
    	
 
    
	
Cash   Settlement:
    	
 
    	
If   Cash Settlement is applicable to any Option exercised or deemed exercised   hereunder, in lieu of Section 8.1 of the Equity Definitions, Dealer will pay   to Counterparty, on the relevant Settlement Date for each such Option, an   amount of cash (the “Cash Settlement Amount”   and each of the Net Share Settlement Amount, the sum of the Combination Settlement   Cash Amount and the Combination Settlement Share Amount, and the Cash   Settlement Amount, in each case, with respect to any Option exercised or   deemed exercised hereunder, the “Delivery Obligation”)   equal to the sum, for each Valid Day during the Settlement Averaging Period   for such Option, of (i) the Daily Option Value for such Valid Day, divided by (ii) the number of Valid Days in the Settlement   Averaging Period.
    
	
 
    	
 
    	
 
    
	
Daily   Option Value:
    	
 
    	
For   any Valid Day, an amount equal to (i) the Conversion Rate on such Valid Day, multiplied by (ii) the Applicable Percentage, multiplied by (iii) the Relevant Price on such Valid Day less the Strike Price on such Valid Day; provided that if the calculation contained in clause (iii)   above results in a negative number, the Daily Option Value for such Valid Day   shall be deemed to be zero. In no event will the Daily Option Value be less   than zero.
    
	
 
    	
 
    	
 
    
	
Applicable   Limit:
    	
 
    	
For   any Option, an amount of cash equal to the Applicable Percentage multiplied by the excess of (i) the aggregate of (A) the   amount of cash, if any, delivered to the “Holder” (as defined in the   Indenture) of the Relevant Convertible Note upon conversion of such Relevant   Convertible Note and (B) the number of Shares, if any, delivered to the   “Holder” (as defined in the Indenture) of the Relevant Convertible Note upon   conversion of Relevant Convertible Note multiplied by   the Applicable Limit Price on the Settlement Date for such Option, over (ii) USD1,000.
    
	
 
    	
 
    	
 
    
	
Applicable   Limit Price:
    	
 
    	
On   any day, the opening price as displayed under the heading “Op” on Bloomberg   page GTAT <equity> (or any successor thereto).
    
	
 
    	
 
    	
 
    
	
Valid   Day:
    	
 
    	
A   day on which (i) there is no Market Disruption Event and (ii) trading in the   Shares generally occurs on the Exchange or, if the Shares are not then listed   on the Exchange, on the principal other U.S. national or regional securities   exchange on which the Shares are then listed or, if the Shares are not then   listed on a U.S. national or regional securities exchange, on the principal other   market on which the Shares are then listed or admitted for trading. If the   Shares are not so listed or admitted for trading, “Valid Day” means a   Business Day.
    
	
 
    	
 
    	
 
    
	
Scheduled   Valid Day:
    	
 
    	
A   day that is scheduled to be a Valid Day on the principal U.S. national or   regional securities exchange or market on which the Shares are listed or   admitted for trading. If the Shares are not so
    

 

6

 

	
 
    	
 
    	
listed   or admitted for trading, “Scheduled Valid Day” means a Business Day.
    
	
 
    	
 
    	
 
    
	
Business   Day:
    	
 
    	
Any   day other than a Saturday, a Sunday or a day on which the Federal Reserve   Bank of New York is authorized or required by law or executive order to close   or be closed.
    
	
 
    	
 
    	
 
    
	
Settlement   Date:
    	
 
    	
For   any Option, the third Scheduled Valid Day immediately following the final   Valid Day of the Settlement Averaging Period for such Option.
    
	
 
    	
 
    	
 
    
	
Relevant   Price:
    	
 
    	
On   any Valid Day, the per Share volume-weighted average price as displayed under   the heading “Bloomberg VWAP” on Bloomberg page “GTAT <equity> AQR” (or   its equivalent successor if such page is not available) in respect of the   period from the scheduled open of trading on the Exchange to the Scheduled   Closing Time of the Exchange on such Valid Day (or if such volume-weighted   average price is unavailable, the market value of one Share on such Valid   Day, as determined by the Calculation Agent using, if practicable, a   volume-weighted average method). The Relevant Price will be determined   without regard to after hours trading or any other trading outside of the   regular trading session trading hours.
    
	
 
    	
 
    	
 
    
	
Settlement   Averaging Period:
    	
 
    	
For   any Option and regardless of the Settlement Method applicable to such Option:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(i)                                     if the related Conversion Date occurs prior to April 1, 2017, the 40   consecutive Valid Days commencing on, and including, the third Valid Day   following such Conversion Date; provided that   if the Notice of Exercise for such Option specifies that Settlement in Shares   or Low Cash Combination Settlement applies to the Relevant Convertible Note,   the Settlement Averaging Period shall be the 80 consecutive Valid Day period   commencing on, and including, the third Valid Day immediately following such   Conversion Date; or
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(ii)                                  if the related Conversion Date occurs on or following April 1, 2017,  the 40 consecutive Valid Days   commencing on, and including, the 42nd Scheduled Valid Day   immediately prior to October 1, 2017; provided that   if the Notice of Exercise or Notice of Final Settlement Method, as   applicable, for such Option specifies that Settlement in Shares or Low Cash Combination Settlement applies to   the Relevant Convertible Note, the Settlement Averaging Period shall be the 80 consecutive Valid Days commencing   on, and including, the 82nd Scheduled Valid Day immediately prior to October 1,   2017.
    
	
 
    	
 
    	
 
    
	
Other   Applicable Provisions:
    	
 
    	
To   the extent Dealer is obligated to deliver Shares hereunder, the provisions of   Sections 9.1(c), 9.8, 9.9, 9.10 and 9.11 (except that the Representation and   Agreement contained in Section 9.11 of the Equity Definitions shall be   modified by excluding any representations therein relating to restrictions,   obligations, limitations or requirements under applicable securities laws arising   as a result of the fact that Counterparty is the Issuer of the Shares) of the   Equity Definitions will be applicable as if “Physical
    

 

7

 

	
 
    	
 
    	
Settlement”   applied to the Transaction.
    
	
 
    	
 
    	
 
    
	
Restricted   Certificated Shares:
    	
 
    	
Notwithstanding   anything to the contrary in the Equity Definitions, Dealer may, in whole or   in part, deliver any Shares required to be delivered to Counterparty   hereunder in certificated form in lieu of delivery through the Clearance System.   With respect to such certificated Shares, the Representation and Agreement   contained in Section 9.11 of the Equity Definitions shall be modified by   deleting the remainder of the provision after the word “encumbrance” in the   fourth line thereof.
    
	
 
    	
 
    	
 
    
	
Share   Adjustments:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Method   of Adjustment:
    	
 
    	
Notwithstanding   Section 11.2 of the Equity Definitions, upon the occurrence of any event or   condition set forth in Sections 8.04(a), (b), (c), (d) and (e) of the   Supplemental Indenture that results in an adjustment under the Indenture, the   Calculation Agent shall make a corresponding adjustment to the terms relevant   to the exercise, settlement or payment of the Transaction. Immediately upon   the occurrence of any such event or condition contemplated by Section Sections   8.04(a), (b), (c), (d) and (e) of the Supplemental Indenture, Counterparty   shall notify the Calculation Agent of such event or condition; and once the   adjustments to be made to the terms of the Indenture and the Convertible   Notes in respect of such event or condition have been determined,   Counterparty shall immediately notify the Calculation Agent in writing of the   details of such adjustments; provided   that, notwithstanding the foregoing, if any Potential Adjustment Event occurs   during the Settlement Averaging Period but no adjustment was made to any   Convertible Note under the Indenture because the relevant “Holder” (as   defined in the Indenture) was deemed to be a record owner of the underlying   Shares on the related Conversion Date, then the Calculation Agent shall make   an adjustment, as determined by it, to the terms hereof in order to account   for such Potential Adjustment Event.
    
	
 
    	
 
    	
 
    
	
Extraordinary   Events:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Merger   Events:
    	
 
    	
Notwithstanding   Section 12.1(b) of the Equity Definitions, a “Merger Event” means the   occurrence of any event or condition set forth in Section 8.07(a) of the   Supplemental Indenture.
    
	
 
    	
 
    	
 
    
	
Consequences   of Merger Events:
    	
 
    	
Notwithstanding   Sections 12.2 and 12.3 of the Equity Definitions, upon the occurrence of a   Merger Event that results in an adjustment under the Indenture, the   Calculation Agent shall make a corresponding adjustment to the terms relevant   to the exercise, settlement or payment of the Transaction; provided that such adjustment shall be   made without regard to any adjustment to the Conversion Rate pursuant to   Section 8.03 or 8.04(h)  of the   Supplemental Indenture; and provided   further that the Calculation Agent may limit or alter any such   adjustment referenced in this paragraph so that the fair value of the   Transaction to Dealer (taking into account a commercially reasonable hedge   position) is not adversely affected as a result of such adjustment; and provided further that if, with respect   to a Merger Event, (i) the consideration for the Shares includes (or, at the   option of a holder of Shares, may include) shares of an entity or person that   is not a corporation organized under the laws of the United States, any State   thereof or the District of Columbia or (ii) the Counterparty following such
    

 

8

 

	
 
    	
 
    	
Merger   Event will not be a corporation organized under the laws of the United   States, any State thereof or the District of Columbia or will not be the   Issuer following such Merger Event, Cancellation and Payment (Calculation Agent   Determination) may apply at the sole election of Dealer.
    
	
 
    	
 
    	
 
    
	
Notice   of Merger Consideration:
    	
 
    	
Upon   the occurrence of a Merger Event that causes the Shares to be converted into   the right to receive more than a single type of consideration (determined based   in part upon any form of stockholder election), Counterparty shall reasonably   promptly (but, in any event prior to the effective time of such Merger Event)   notify the Calculation Agent of (i) the weighted average of the types and   amounts of consideration received by the holders of Shares entitled to   receive cash, securities or other property or assets with respect to or in   exchange for such Shares in any Merger Event who affirmatively make such an   election and (ii) the details of the adjustment made under the Indenture in   respect of such Merger Event.
    
	
 
    	
 
    	
 
    
	
Nationalization,   Insolvency or Delisting:
    	
 
    	
Cancellation   and Payment (Calculation Agent Determination); provided that, in addition to the provisions of Section 12.6(a)(iii)   of the Equity Definitions, it 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   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 thereafter be deemed to be the Exchange.
    
	
 
    	
 
    	
 
    
	
Additional   Disruption Events:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
(a)          Change in Law:
    	
 
    	
Applicable;   provided that Section 12.9(a)(ii) is   hereby amended by (x) adding the words “(including, for the avoidance of   doubt and without limitation, adoption or promulgation of new regulations   authorized or mandated by existing statute)” after the word “regulation” in   the second line thereof, (y) adding the words “or any Hedge Positions” after   the word “Shares” in the clause (X) thereof and (z) adding the words “, or   holding, acquiring or disposing of Shares or any Hedge Positions relating,”   after the word “obligations” in clause (Y) thereof.
    
	
 
    	
 
    	
 
    
	
(b)         Failure to Deliver:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
(c)          Insolvency Filing:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
(d)         Hedging Disruption:
    	
 
    	
Applicable;   provided that:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(i)   Section 12.9(a)(v) of the Equity Definitions is hereby modified by inserting   the following two phrases at the end of such Section:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
“For   the avoidance of doubt, the term “equity price risk” shall be deemed to   include, but shall not be limited to, stock price and volatility risk. And,   for the further avoidance of doubt, any such transactions or assets referred   to in phrases (A) or (B) above must be available on commercially reasonable   pricing terms.”; and
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(ii)   Section 12.9(b)(iii) of the Equity Definitions is hereby amended by inserting   in the third line thereof, after the words “to terminate the Transaction”,   the words “or a portion of the
    

 

9

 

	
 
    	
 
    	
Transaction   affected by such Hedging Disruption”.
    
	
 
    	
 
    	
 
    
	
(e)          Increased Cost of Hedging:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
Hedging   Party:
    	
 
    	
For   all applicable Potential Adjustment Events and Extraordinary Events, Dealer
    
	
 
    	
 
    	
 
    
	
Determining   Party:
    	
 
    	
For   all applicable Extraordinary Events, Dealer
    
	
 
    	
 
    	
 
    
	
Non-Reliance:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
Agreements   and Acknowledgments Regarding Hedging Activities:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
Additional   Acknowledgments:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
3.               Calculation Agent:
    	
 
    	
Dealer
    
	
 
    	
 
    	
 
    
	
4.               Account Details:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Dealer   Payment Instructions:
    	
 
    	
Bank   of America, N.A.
    
	
 
    	
 
    	
New   York, NY
    
	
 
    	
 
    	
SWIFT:   BOFAUS3N
    
	
 
    	
 
    	
Bank   Routing: 026-009-593
    
	
 
    	
 
    	
Account   Name: Bank of America
    
	
 
    	
 
    	
Account   No. : 0012334-61892
    
	
 
    	
 
    	
 
    
	
Counterparty   Payment Instructions:
    	
 
    	
To be provided by Counterparty.
    

 

5.               Offices:

 

The Office of Dealer for the Transaction is: New York

 

The Office of Counterparty for the Transaction is: Not applicable

 

6.               Notices:

 

Address for notices or communications to Counterparty for purposes of this Confirmation:

 

	
To:
    	
GT   Advanced Technologies Inc.
    
	
 
    	
20   Trafalgar Square
    
	
 
    	
Nashua,   NH 03063
    
	
Attn:
    	
Hoil   Kim, General Counsel
    
	
Telephone:
    	
(603)   883-5200
    

 

Address for notices or communications to Dealer for purposes of this Confirmation:

 

	
To:
    	
Bank of America, N.A.
    
	
 
    	
c/o Merrill Lynch, Pierce, Fenner & Smith Incorporated
    
	
 
    	
One Bryant Park
    
	
 
    	
New York, NY 10036
    
	
Attn:
    	
John Servidio
    
	
Telephone:
    	
646-855-7127
    
	
Facsimile:
    	
704-208-2869
    

 

7.               Representations, Warranties and Agreements:

 

(a)                                  In addition to the representations and warranties in the Agreement and those contained elsewhere herein, Counterparty represents and warrants to and for the benefit of, and agrees with, Dealer as of the date hereof (unless otherwise specified) that:

 

(i)                                     On the Trade Date, and as of any date on which Counterparty gives Dealer a Notice of Cash Payment Termination under (and as defined in) Section 8(b) below, (A) none of Counterparty and its officers and directors is aware of any material nonpublic information regarding Counterparty or the Shares and (B) all reports and other documents filed by Counterparty with the Securities and Exchange Commission pursuant to

 

10

 

the Securities Exchange Act of 1934, as amended (the “Exchange Act”) when considered as a whole (with the more recent such reports and documents deemed to amend inconsistent statements contained in any earlier such reports and documents), do not contain any untrue statement of a material fact or any omission of a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances in which they were made, not misleading.

 

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

 

(iii)                               Without limiting the generality of Section 13.1 of the Equity Definitions, Counterparty acknowledges that Dealer is not making any representations or warranties or taking any position or expressing any view with respect to the treatment of the 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 (or any successor issue statements) or under FASB’s Liabilities & Equity Project.

 

(iv)                              Without limiting the generality of Section 3(a)(iii) of the Agreement, the Transaction will not violate Rule 13e-1 or Rule 13e-4 under the Exchange Act.

 

(v)                                 Prior to the Trade Date, Counterparty shall deliver to Dealer a resolution of Counterparty’s board of directors authorizing the Transaction and such other certificate or certificates as Dealer shall reasonably request.

 

(vi)                              Counterparty is not entering into this Confirmation to create actual or apparent trading activity in the Shares (or any security convertible into or exchangeable for Shares) or to raise or depress or otherwise manipulate the price of the Shares (or any security convertible into or exchangeable for Shares) or otherwise in violation of the Exchange Act.

 

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

 

(viii)                        On each of the Trade Date and the Premium Payment Date, Counterparty is not, or will not be, “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 the Shares hereunder in compliance with the laws of the jurisdiction of its incorporation.

 

(ix)                                No state law, rule, regulation or regulatory order applicable to the Shares would give rise to any reporting, consent, registration or other requirement (including without limitation a requirement to obtain prior approval from any person or entity) as a result of Dealer or its affiliates owning or holding (however defined) Shares, other than any reporting requirement imposed by Section 13 or 16 of the Exchange Act.

 

(x)                                   The representations and warranties of Counterparty set forth in Section 3 of the Agreement and Section 3 of the Underwriting Agreement, dated September 24, 2012 (the “Underwriting Agreement”), among the Counterparty, UBS Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representatives of the Underwriters party thereto, are true and correct and are hereby deemed to be repeated to Dealer as if set forth herein.

 

(xi)                                Counterparty understands no obligations of Dealer to it hereunder will be entitled to the benefit of deposit insurance and that such obligations will not be guaranteed by any affiliate of Dealer or any governmental agency.

 

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

 

11

 

(b)                                 Each of Dealer and Counterparty agrees and represents that it is an “eligible contract participant” as defined in the U.S. Commodity Exchange Act, as amended.

 

(c)                                  Each of Dealer and Counterparty acknowledges that the offer and sale of the Transaction to it is intended to be exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”), by virtue of Section 4(2) thereof.  Accordingly, Counterparty represents and warrants to Dealer that (i) it has the financial ability to bear the economic risk of its investment in the Transaction and is able to bear a total loss of its investment, (ii) it is an “accredited investor” as that term is defined in Regulation D as promulgated under the Securities Act, (iii) it is entering into the Transaction for its own account and without a view to the distribution or resale thereof and (iv) the assignment, transfer or other disposition of the Transaction has not been and will not be registered under the Securities Act and is restricted under this Confirmation, the Securities Act and state securities laws.

 

(d)                                 Counterparty agrees and acknowledges that Dealer is a “financial institution,”  “swap participant” and “financial participant” within the meaning of Sections 101(22), 101(53C) and 101(22A) of the Bankruptcy Code.  The parties hereto further agree and acknowledge that it is the intent of the parties that (A) this Confirmation is (i) a “securities contract,” as such term is defined in Section 741(7) of the Bankruptcy Code, with respect to which each payment and delivery hereunder or in connection herewith is a “termination value,” “payment amount” or “other transfer obligation” within the meaning of Section 362 of the Bankruptcy Code and a “settlement payment,” within the meaning of Section 546 of the Bankruptcy Code and (ii) a “swap agreement,” as such term is defined in Section 101(53B) of the Bankruptcy Code, with respect to which each payment and delivery hereunder or in connection herewith is a “termination value,” “payment amount” or “other transfer obligation” within the meaning of Section 362 of the Bankruptcy Code and a “transfer,” as such term is defined in Section 101(54) of the Bankruptcy Code and a “payment or other transfer of property” within the meaning of Sections 362 and 546 of the Bankruptcy Code, and (B) Dealer is entitled to the protections afforded by, among other sections, Sections 362(b)(6), 362(b)(17), 362(o), 546(e), 546(g), 548(d)(2), 555, 560 and 561 of the Bankruptcy Code.

 

(e)                                  Counterparty shall deliver to Dealer an opinion of counsel, dated as of the Effective Date and reasonably acceptable to Dealer in form and substance, with respect to the matters set forth in Section 3(a) of the Agreement.

 

8.  Other Provisions:

 

(a)                                  Additional Termination Events.  The occurrence of (i) an “Event of Default” with respect to Counterparty under the terms of the Convertible Notes as set forth in Section 5.02 of the Supplemental Indenture or (ii) an Amendment Event shall be an Additional Termination Event with respect to which the Transaction is the sole Affected Transaction and Counterparty is the sole Affected Party and Dealer shall be the party entitled to designate an Early Termination Date pursuant to Section 6(b) of the Agreement.

 

“Amendment Event” means that Counterparty amends, modifies, supplements, waives or obtains a waiver in respect of any term of the Indenture or the Convertible Notes governing the principal amount, coupon, maturity, repurchase obligation of Counterparty, redemption right of Counterparty, any term relating to conversion of the Convertible Notes (including changes to the conversion price, conversion settlement dates or conversion conditions), or any term that would require consent of the holders of not less than 100% of the principal amount of the Convertible Notes to amend, in each case without the consent of Dealer.

 

(b)                                 Alternative Calculations and Payment on Early Termination and on Certain Extraordinary Events.  If Dealer shall owe Counterparty any amount pursuant to “Consequences of Merger Events” above or Sections 12.6, 12.7 or 12.9 of the Equity Definitions or pursuant to Section 6(d)(ii) of the Agreement (a “Payment Obligation”), Dealer shall satisfy any such Payment Obligation by the Share Termination Alternative (as defined below), unless (a) Counterparty gives irrevocable telephonic notice to Dealer, confirmed in writing within one Scheduled Trading Day, no later than 9:30 A.M., New York City time, on the Scheduled Trading Day immediately following the relevant merger date, Announcement Date, Early Termination Date or date of cancellation or termination in respect of an Extraordinary Event, as applicable, of its election that the Share Termination Alternative shall not apply (“Notice of Cash Payment Termination”) and (b) Dealer agrees, in its sole discretion, to such election, in which case the provisions of “Consequences of Merger Events” above, Sections 12.6, 12.7 or 12.9 of the Equity Definitions or Section 6(d)(ii) of the Agreement, as the case may be, shall apply.  If the Share Termination Alternative applies, the following provisions shall apply on the Scheduled Trading Day immediately following the relevant merger date, Announcement Date, Early Termination Date or date of cancellation or termination in respect of an Extraordinary Event, as applicable:

 

	
Share Termination Alternative:
    	
Applicable   and means that Dealer shall deliver to Counterparty the Share
    

 

12

 

	
 
    	
Termination   Delivery Property on the date on which the Payment Obligation would otherwise   be due pursuant to “Consequences of Merger Events” above, Section 12.7 or   12.9 of the Equity Definitions or Section 6(d)(ii) of the Agreement, as   applicable, or such later date as the Calculation Agent may reasonably   determine (the “Share Termination   Payment Date”), in satisfaction of the Payment Obligation.
    
	
 
    	
 
    
	
Share Termination Delivery Property:
    	
A   number of Share Termination Delivery Units, as calculated by the Calculation   Agent, equal to the Payment Obligation divided by   the Share Termination Unit Price. The Calculation Agent shall adjust the   Share Termination Delivery Property by replacing any fractional portion of   the aggregate amount of a security therein with an amount of cash equal to   the value of such fractional security based on the values used to calculate   the Share Termination Unit Price.
    
	
 
    	
 
    
	
Share Termination Unit Price:
    	
The   value of property contained in one Share Termination Delivery Unit on the   date such Share Termination Delivery Units are to be delivered as Share   Termination Delivery Property, as determined by the Calculation Agent in its   discretion by commercially reasonable means and notified by the Calculation   Agent to Dealer at the time of notification of the Payment Obligation.
    
	
 
    	
 
    
	
Share Termination Delivery Unit:
    	
In   the case of a Termination Event, Event of Default, Delisting or Additional   Disruption Event, one Share or, in the case of an Insolvency, Nationalization   or Merger Event, one Share or a unit consisting of the number or amount of   each type of property received by a holder of one Share (without   consideration of any requirement to pay cash or other consideration in lieu   of fractional amounts of any securities) in such Insolvency, Nationalization   or Merger Event, as applicable. If such Insolvency, Nationalization or 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.
    
	
 
    	
 
    
	
Failure to Deliver:
    	
Applicable
    
	
 
    	
 
    
	
Other applicable provisions:
    	
If   Share Termination Alternative is applicable, the provisions of Sections 9.8,   9.9, 9.10 and 9.11 (except that the Representation and Agreement contained in   Section 9.11 of the Equity Definitions shall be modified by excluding any   representations therein relating to restrictions, obligations, limitations or   requirements under applicable securities laws arising as a result of the fact   that Counterparty is the issuer of the Shares or any portion of the Share   Termination Delivery Units) of the Equity Definitions will be applicable as   if “Physical Settlement” applied to the Transaction, except that all   references to “Shares” shall be read as references to “Share Termination   Delivery Units.”
    

 

(c)                                  Disposition of Hedge Shares.  Counterparty hereby agrees that if, in the good faith reasonable judgment of Dealer, any Shares (the “Hedge Shares”) acquired by Dealer for the purpose of hedging its obligations pursuant to the Transaction cannot be sold in the public market by Dealer without registration under the Securities Act, Counterparty shall, at its election: (i) in order to allow Dealer to sell the Hedge Shares in a registered offering, make available to Dealer an effective registration statement under the Securities Act to cover the resale of such Hedge Shares and (A) enter into an agreement, in form and substance satisfactory to Dealer, substantially in the form of an underwriting agreement for a registered offering, (B) provide accountant’s “comfort” letters in customary form for registered offerings of equity securities, (C) provide disclosure opinions of nationally recognized outside counsel to Counterparty reasonably acceptable to Dealer, (D) provide other customary opinions, certificates and closing documents customary in form for registered offerings of equity securities and (E) afford Dealer a reasonable opportunity to conduct a “due diligence” investigation with respect to Counterparty customary in scope for underwritten offerings of equity securities (provided, however, that if Dealer, in its sole reasonable discretion, is not satisfied with access to due diligence materials, the results of its due diligence investigation, or the procedures and documentation for the registered offering referred to above, then clause (ii) or clause (iii) of this Section 8(c) shall apply at the election of Counterparty); (ii) in order to allow Dealer to sell the Hedge Shares in a private placement, enter into a private placement agreement substantially similar to private placement purchase agreements customary for private placements of equity securities, in form and substance satisfactory to Dealer, including customary representations, covenants, blue sky and other

 

13

 

governmental filings and/or registrations, indemnities to Dealer, due diligence rights (for Dealer or any designated buyer of the Hedge Shares from Dealer), opinions and certificates and such other documentation as is customary for private placements agreements, all reasonably acceptable to Dealer (in which case, the Calculation Agent shall make any adjustments to the terms of the Transaction that are necessary, in its reasonable judgment, to compensate Dealer for any discount from the public market price of the Shares incurred on the sale of Hedge Shares in a private placement); or (iii) purchase the Hedge Shares from Dealer at the Relevant Price on such Exchange Business Days, and in the amounts, requested by Dealer.

 

(d)                                 Amendment to Equity Definitions.  The following amendment shall be made to the Equity Definitions:

 

Section 12.6(a)(ii) of the Equity Definitions is hereby amended by (1) deleting from the fourth line thereof the word “or” after the word “official” and inserting a comma therefor, and (2) deleting the semi-colon at the end of subsection (B) thereof and inserting the following words therefor “or (C) at Dealer’s option, the occurrence of any of the events specified in Section 5(a)(vii)(1) through (9) of the ISDA Master Agreement with respect to that Issuer.”

 

(e)                                  Repurchase and Conversion Rate Adjustment Notices.  Counterparty shall, at least 10 Scheduled Trading Days prior to effecting any repurchase of Shares or consummating or otherwise executing or engaging in any transaction or event (a “Conversion Rate Adjustment Event”) that would lead to an increase in the Conversion Rate (as such term is defined in the Indenture), give Dealer a written notice of such repurchase or Conversion Rate Adjustment Event (a “Repurchase Notice”) if, following such repurchase or Conversion Rate Adjustment Event, the Notice Percentage as determined on the date of such Repurchase Notice is (i) greater than 4.5% and (ii) greater by 0.5% than the Notice Percentage included in the immediately preceding Repurchase Notice (or, in the case of the first such Repurchase Notice, greater than the Notice Percentage as of the date hereof), and, if such repurchase or Conversion Rate Adjustment Event, or the intention to effect the same, would constitute material non-public information with respect to Counterparty or the Shares, Counterparty shall make public disclosure thereof at or prior to delivery of such Repurchase Notice.  The “Notice Percentage” as of any day is the fraction, expressed as a percentage, the numerator of which is the Number of Shares and the denominator of which is the number of Shares outstanding on such day.  In the event that Counterparty fails to provide Dealer with a Repurchase Notice on the day and in the manner specified in this Section 8(e) then Counterparty agrees to indemnify and hold harmless Dealer, its affiliates and their respective directors, officers, employees, agents and controlling persons (Dealer and each such person being an “Indemnified Party”) from and against any and all losses, claims, damages and liabilities (or actions in respect thereof), joint or several, to which such Indemnified Party may become subject under applicable securities laws, including without limitation, Section 16 of the Exchange Act, relating to or arising out of such failure.  If for any reason the foregoing indemnification is unavailable to any Indemnified Party or insufficient to hold harmless any Indemnified Party, then Counterparty shall contribute, to the maximum extent permitted by law, to the amount paid or payable by the Indemnified Party as a result of such loss, claim, damage or liability.  In addition, Counterparty will reimburse any Indemnified Party for all expenses (including reasonable counsel fees and expenses) as they are incurred (after notice to Counterparty) in connection with the investigation of, preparation for or defense or settlement of any pending or threatened claim or any action, suit or proceeding arising therefrom, whether or not such Indemnified Party is a party thereto and whether or not such claim, action, suit or proceeding is initiated or brought by or on behalf of Counterparty.  This indemnity shall survive the completion of the Transaction contemplated by this Confirmation and any assignment and delegation of the Transaction made pursuant to this Confirmation or the Agreement shall inure to the benefit of any permitted assignee of Dealer.

 

(f)                                    Transfer and Assignment.  Either party may transfer any of its rights or obligations under the Transaction with the prior written consent of the non-transferring party, such consent not to be unreasonably withheld or delayed. For the avoidance of doubt, Dealer may condition its consent on any of the following, without limitation: (i) the receipt by Dealer of opinions and documents reasonably satisfactory to Dealer in connection with such assignment, (ii) such assignment being effected on terms reasonably satisfactory to Dealer with respect to any legal and regulatory requirements relevant to Dealer, and (iii) Counterparty continuing to be obligated to provide notices hereunder relating to the Convertible Notes and continuing to be obligated with respect to “Disposition of Hedge Shares” and “Repurchase Notices” above.  In addition, Dealer may transfer or assign without any consent of the Counterparty its rights and obligations hereunder and under the Agreement, in whole or in part, to (i) any of its affiliates, (ii) any entities sponsored or organized by, or on behalf of or for the benefit of Dealer or (iii) any person of credit quality equivalent to Dealer.  At any time at which any Excess Ownership Position or a Hedging Disruption exists, if Dealer, in its discretion, is unable to effect a transfer or assignment to a third party in accordance with the requirements set forth above after using its commercially reasonable efforts on pricing terms and within a time period reasonably acceptable to Dealer such that an Excess Ownership Position or a Hedging Disruption, as the case may be, no longer exists, Dealer may designate any

 

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Scheduled Trading Day as an Early Termination Date with respect to a portion (the “Terminated Portion”) of the Transaction, such that such Excess Ownership Position or Hedging Disruption, as the case may be, no longer exists. In the event that Dealer so designates an Early Termination Date with respect to a portion of the Transaction, a payment or delivery shall be made pursuant to Section 6 of the Agreement and Section 8(b) of this Confirmation as if (i) an Early Termination Date had been designated in respect of a Transaction having terms identical to the Terminated Portion of the Transaction, (ii) Counterparty shall be the sole Affected Party with respect to such partial termination and (iii) such portion of the Transaction shall be the only Terminated Transaction. “Excess Ownership Position” means any of the following: (i) the Equity Percentage exceeds 7.5%, (ii) Dealer or any “affiliate” or “associate” of Dealer would own in excess of 13% of the outstanding Shares for purposes of Section 203 of the Delaware General Corporation Law or (iii) Dealer, Dealer Group (as defined below) or any person whose ownership position would be aggregated with that of Dealer or Dealer Group (Dealer, Dealer Group or any such person, a “Dealer Person”) under any federal, state or local laws, regulations, regulatory orders or organizational documents or contracts of Counterparty that are, in each case, applicable to ownership of Shares (“Applicable Laws”), owns, beneficially owns, constructively owns, controls, holds the power to vote or otherwise meets a relevant definition of ownership in excess of a number of Shares equal to (x) the number of Shares that would give rise to reporting or registration obligations or other requirements (including obtaining prior approval by a state or federal regulator) of a Dealer Person, or could result in an adverse effect on a Dealer Person, under Applicable Laws, as determined by Dealer in its reasonable discretion, and with respect to which such requirements have not been met or the relevant approval has not been received or that would give rise to any consequences under the constitutive documents of Counterparty or any contract or agreement to which Counterparty is a party, in each case minus (y) 1% of the number of Shares outstanding on the date of determination.  The “Equity Percentage” as of any day is the fraction, expressed as a percentage, (A) the numerator of which is the number of Shares that Dealer and any of its affiliates or any other person subject to aggregation with Dealer, for purposes of the “beneficial ownership” test under Section 13 of the Exchange Act, or any “group” (within the meaning of Section 13) of which Dealer is or may be deemed to be a part (Dealer and any such affiliates, persons and groups, collectively, “Dealer Group”) beneficially owns (within the meaning of Section 13 of the Exchange Act), without duplication, on such day (or, to the extent that, as a result of a change in law, regulation or interpretation after the date hereof, the equivalent calculation under Section 16 of the Exchange Act and the rules and regulations thereunder results in a higher number, such number) and (B) the denominator of which is the number of Shares outstanding on such day.

 

(g)                                 Staggered Settlement.  Dealer may, by notice to Counterparty on or prior to any Settlement Date (a “Nominal Settlement Date”), elect to deliver any Shares deliverable hereunder on two or more dates (each, a “Staggered Settlement Date”) or at two or more times on the Nominal Settlement Date as follows:

 

(i)                                     in such notice, Dealer will specify to Counterparty the related Staggered Settlement Dates (each of which will be on or prior to such Nominal Settlement Date, but not prior to the beginning of the related Settlement Averaging Period) or delivery times and how it will allocate the Shares it is required to deliver hereunder among the Staggered Settlement Dates or delivery times;

 

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

 

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

 

(h)                                 Right to Extend.  Dealer may postpone any Exercise Date or Settlement Date or any other date of valuation or delivery by Dealer, with respect to some or all of the relevant Options (in which event the Calculation Agent shall make appropriate adjustments to the Delivery Obligation), if Dealer determines, in its reasonable discretion, that such extension is reasonably necessary or appropriate to (i) preserve Dealer’s hedging or hedge unwind activity hereunder in light of existing liquidity conditions in the cash market, the stock loan market or any other relevant market or (ii) to enable Dealer to effect purchases of Shares in connection with its hedging, hedge unwind or settlement activity hereunder in a manner that would, if Dealer were Counterparty or an affiliated purchaser of Counterparty, be in compliance with applicable legal, regulatory or self-regulatory requirements, or with related policies and procedures applicable to Dealer.

 

(i)                                     Adjustments.  For the avoidance of doubt, whenever the Calculation Agent is called upon to make an

 

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adjustment pursuant to the terms of this Confirmation or the Definitions to take into account the effect of an event, the Calculation Agent shall make such adjustment by reference to the effect of such event on the Hedging Party, assuming that the Hedging Party maintains a commercially reasonable hedge position.

 

(j)                                     Disclosure.  Effective from the date of commencement of discussions concerning the Transaction, Counterparty and each of its employees, representatives, or other agents may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the Transaction and all materials of any kind (including opinions or other tax analyses) that are provided to Counterparty relating to such tax treatment and tax structure.

 

(k)                                  Designation by Dealer.  Notwithstanding any other provision in this Confirmation to the contrary requiring or allowing Dealer to purchase, sell, receive or deliver any Shares or other securities to or from Counterparty, Dealer may designate any of its affiliates to purchase, sell, receive or deliver such shares or other securities and otherwise to perform Dealer obligations in respect of the Transaction and any such designee may assume such obligations.  Dealer shall be discharged of its obligations to Counterparty to the extent of any such performance.

 

(l)                                     No Netting and Set-off.  Each party waives any and all rights it may have to set off obligations arising under the Agreement and the Transaction against other obligations between the parties, whether arising under any other agreement, applicable law or otherwise.

 

(m)                               Equity Rights.  Dealer acknowledges and agrees that this Confirmation is not intended to convey to it rights with respect to the Transaction that are senior to the claims of common stockholders in the event of Counterparty’s bankruptcy.  For the avoidance of doubt, the parties agree that the preceding sentence shall not apply at any time other than during Counterparty’s bankruptcy to any claim arising as a result of a breach by Counterparty of any of its obligations under this Confirmation or the Agreement.  For the avoidance of doubt, the parties acknowledge that this Confirmation is not secured by any collateral that would otherwise secure the obligations of Counterparty herein under or pursuant to any other agreement.

 

(n)                                 Early Unwind.  In the event the sale by Counterparty of the Convertible Notes is not consummated with the initial purchasers pursuant to the Underwriting Agreement for any reason by the close of business in New York on September 28, 2012 (or such later date as agreed upon by the parties) (September 28, 2012 or such later date being the “Early Unwind Date”), the Transaction shall automatically terminate (the “Early Unwind”), on the Early Unwind Date and (i) the Transaction and all of the respective rights and obligations of Dealer and Counterparty thereunder shall be cancelled and terminated and (ii) Counterparty shall pay to Dealer an amount in cash equal to the aggregate amount of costs and expenses relating to the unwinding of Dealer’s hedging activities in respect of the Transaction (including market losses incurred in reselling any Shares purchased by Dealer or its affiliates in connection with such hedging activities).  Following such termination, cancellation and payment, each party shall be released and discharged by the other party from and agrees not to make any claim against the other party with respect to any obligations or liabilities of either party arising out of and to be performed in connection with the Transaction either prior to or after the Early Unwind Date.  Dealer and Counterparty represent and acknowledge to the other that upon an Early Unwind and following the payment referred to above, all obligations with respect to the Transaction shall be deemed fully and finally discharged.

 

(o)                                 Wall Street Transparency and Accountability Act of 2010.  The parties hereby agree that none of (v) Section 739 of the Wall Street Transparency and Accountability Act of 2010 (“WSTAA”), (w) any similar legal certainty provision in any legislation enacted, or rule or regulation promulgated, on or after the Trade Date, (x) the enactment of WSTAA or any regulation under the WSTAA, (y) any requirement under WSTAA nor (z) an amendment made by WSTAA, shall limit or otherwise impair either party’s rights to terminate, renegotiate, modify, amend or supplement this Confirmation or the Agreement, as applicable, arising from a termination event, force majeure, illegality, increased costs, regulatory change or similar event under this Confirmation, the Equity Definitions incorporated herein, or the Agreement (including, but not limited to, rights arising from Change in Law, Hedging Disruption, Increased Cost of Hedging, an Excess Ownership Position or Illegality (as defined in the Agreement)).

 

(p)                                 Waiver of Trial by Jury.  EACH OF COUNTERPARTY AND DEALER 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 TRANSACTION OR THE ACTIONS OF DEALER OR ITS AFFILIATES IN THE NEGOTIATION, PERFORMANCE OR ENFORCEMENT HEREOF.

 

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(q)                                 Governing Law; Jurisdiction.  THIS CONFIRMATION AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO THIS CONFIRMATION SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.  THE PARTIES HERETO IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND THE UNITED STATES COURT FOR THE SOUTHERN DISTRICT OF NEW YORK IN CONNECTION WITH ALL MATTERS RELATING HERETO AND WAIVE ANY OBJECTION TO THE LAYING OF VENUE IN, AND ANY CLAIM OF INCONVENIENT FORUM WITH RESPECT TO, THESE COURTS.

 

(r)                                    [Reserved.]

 

(s)                                  Agreements and Acknowledgements Regarding Hedging.  Counterparty understands, acknowledges and agrees that: (A) at any time on and prior to the last Valid Day of the last Settlement Averaging Period, Dealer and its affiliates may buy or sell Shares or other securities or buy or sell options or futures contracts or enter into swaps or other derivative securities in order to adjust its hedge position with respect to the Transaction; (B) Dealer and its affiliates also may be active in the market for Shares other than in connection with hedging activities in relation to the Transaction; (C) Dealer shall make its own determination as to whether, when or in what manner any hedging or market activities in securities of Counterparty shall be conducted and shall do so in a manner that it deems appropriate to hedge its price and market risk with respect to the Relevant Prices; and (D) any market activities of Dealer and its affiliates with respect to Shares may affect the market price and volatility of Shares, as well as the Relevant Prices, each in a manner that may be adverse to Counterparty.

 

(t)                                    Additional Termination Event for Conversions in Connection with a Make-Whole Fundamental Change.  Notwithstanding anything to the contrary in this Confirmation, the receipt by Dealer from Counterparty, within the applicable time period set forth under “Notice of Exercise” above, of any Notice of Exercise in respect of Options that relate to Convertible Notes as to which additional Shares would be added to the Conversion Rate pursuant to Section 8.03 of the Supplemental Indenture in connection with a “Make-Whole Fundamental Change” (as defined in the Indenture) shall constitute an Additional Termination Event hereunder.  Upon receipt of any such Notice of Exercise, Dealer shall designate an Exchange Business Day following such Additional Termination Event (which Exchange Business Day shall in no event be earlier than the related settlement date for such Convertible Notes) as an Early Termination Date with respect to the portion of this Transaction corresponding to a number of Options (the “Make-Whole Conversion Options”) equal to the lesser of (A) the number of such Options specified in such Notice of Exercise and (B) the Number of Options as of the date Dealer designates such Early Termination Date and, as of such date, the Number of Options shall be reduced by the number of Make-Whole Conversion Options.  Any payment hereunder with respect to such termination shall be calculated pursuant to Section 6 of the Agreement as if (1) an Early Termination Date had been designated in respect of a Transaction having terms identical to this Transaction and a Number of Options equal to the number of Make-Whole Conversion Options, (2) Counterparty were the sole Affected Party with respect to such Additional Termination Event and (3) the terminated portion of the Transaction were the sole Affected Transaction (and, for the avoidance of doubt, in determining the amount payable pursuant to Section 6 of the Agreement, the Calculation Agent shall not take into account any adjustments to the Option Entitlement that result from corresponding adjustments to the Conversion Rate pursuant to Section 8.03 of the Supplemental Indenture); provided that the amount of cash deliverable in respect of such early termination by Dealer to Counterparty shall not be greater than the product of (x) the Applicable Percentage and (y) the excess of (I) (1) the number of Make-Whole Conversion Options, multiplied by (2) the Conversion Rate (after taking into account any applicable adjustments to the Conversion Rate pursuant to Section 8.03 of the Supplemental Indenture), multiplied by (3) a price per Share determined by the Calculation Agent over (II) the aggregate principal amount of such Convertible Notes, as determined by the Calculation Agent in a commercially reasonable manner.

 

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Counterparty hereby agrees (a) to check this Confirmation carefully and immediately upon receipt so that errors or discrepancies can be promptly identified and rectified and (b) to confirm that the foregoing (in the exact form provided by Dealer) correctly sets forth the terms of the agreement between Dealer and Counterparty with respect to the Transaction, by manually signing this Confirmation or this page hereof as evidence of agreement to such terms and providing the other information requested herein and immediately returning an executed copy to John Servidio, Facsimile No. 704-208-2869.

 

	
 
    	
Yours   faithfully,
    
	
 
    	
 
    
	
 
    	
BANK OF AMERICA, N.A.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Christopher A. Hutmaker
    
	
 
    	
 
    	
Name:   Christopher A. Hutmaker
    
	
 
    	
 
    	
Title:   Managing Director
    

 

 

Agreed and Accepted By:

 

GT ADVANCED TECHNOLOGIES INC.

 

 

	
By:
    	
/s/   Hoil Kim
    	
 
    
	
 
    	
Name:   Hoil Kim
    	
 
    
	
 
    	
Title:   Vice President, General Counsel and Secretary
    	
 
    

 

Signature page to Base Convertible Bond Hedge Transaction

 

 

Annex A

 

Premium:                                                USD10,794,714 (Premium per Option approximately USD52.66).

 

Annex A-1

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