Document:

Exhibit 10.13

 

	
 
    	
September 25, 2012
    
	
 
    	
 
    
	
To:
    	
GT Advanced Technologies Inc.
    
	
 
    	
20 Trafalgar Square
    
	
 
    	
Nashua, NH 03063
    
	
 
    	
Attn: Hoil Kim, General Counsel
    
	
 
    	
Telephone: (603) 883-5200
    
	
 
    	
 
    
	
From:
    	
UBS AG, London Branch
    
	
 
    	
c/o UBS AG, Stamford Branch
    
	
 
    	
677 Washington Blvd
    
	
 
    	
Stamford, CT 06901
    
	
 
    	
Attn:
    	
Tracy Johnson / Tim Clary
    
	
 
    	
Facsimile:
    	
203-719-0538
    
	
 
    	
 
    
	
Re:
    	
Additional Issuer Warrant 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 UBS AG, London Branch (“Dealer”), represented by UBS AG, Stamford Branch (“Agent”) as its agent, and GT Advanced Technologies Inc. (“Issuer”).  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.  For purposes of the Equity Definitions, each reference herein to a Warrant shall be deemed to be a reference to a Call Option or an Option, as context requires.

 

This Confirmation evidences a complete and binding agreement between Dealer and Issuer 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 Issuer 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 is a Warrant Transaction, which shall be considered 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:
    	
September 28,   2012, or such other date as agreed between the parties, subject to   Section 8(o) below.
    
	
 
    	
 
    	
 
    
	
 
    	
Components:
    	
The   Transaction will be divided into individual Components, each with the terms   set forth in this Confirmation, and, in particular,
    

 

 

	
 
    	
 
    	
with   the Number of Warrants and Expiration Date set forth in this Confirmation.   The payments and deliveries to be made upon settlement of the Transaction   will be determined separately for each Component as if each Component were a   separate Transaction under the Agreement.
    
	
 
    	
 
    	
 
    
	
 
    	
Warrant   Style:
    	
European
    
	
 
    	
 
    	
 
    
	
 
    	
Warrant   Type:
    	
Call
    
	
 
    	
 
    	
 
    
	
 
    	
Seller:
    	
Issuer
    
	
 
    	
 
    	
 
    
	
 
    	
Buyer:
    	
Dealer
    
	
 
    	
 
    	
 
    
	
 
    	
Shares:
    	
The   common stock of Issuer, par value USD0.01 per share (Ticker Symbol: “GTAT”).
    
	
 
    	
 
    	
 
    
	
 
    	
Number   of Warrants:
    	
For   each Component, as provided in Annex A to this Confirmation.
    
	
 
    	
 
    	
 
    
	
 
    	
Warrant Entitlement:
    	
One Share per Warrant
    
	
 
    	
 
    	
 
    
	
 
    	
Strike   Price:
    	
As   provided in Annex A to this Confirmation.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Notwithstanding anything to the contrary in the   Agreement, this Confirmation or the Equity Definitions, in no event shall the   Strike Price be subject to adjustment to the extent that, after giving effect   to such adjustment, the Strike Price would be less than USD5.92, except for   any adjustment pursuant to the terms of this Confirmation and the Equity   Definitions in connection with stock splits or similar changes to Issuer’s   capitalization.
    
	
 
    	
 
    	
 
    
	
 
    	
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:
    
	
 
    	
 
    	
 
    
	
In respect of any Component:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Expiration   Time:
    	
Valuation   Time
    
	
 
    	
 
    	
 
    
	
 
    	
Expiration   Date:
    	
As   provided in Annex A to this Confirmation (or, if such date is not a   Scheduled Trading Day, the next following Scheduled Trading Day that is not   already an Expiration Date for another Component); provided that if that date is a Disrupted Day, the   Expiration Date for such Component shall be the first succeeding Scheduled   Trading Day that is not a Disrupted Day and is not or is not deemed to be an   Expiration Date in respect of any other Component of the Transaction   hereunder; and provided further   that if the Expiration Date has not occurred pursuant to the preceding   proviso as of the Final Disruption Date, Dealer may elect in its discretion   that the Final Disruption Date shall be the Expiration Date (irrespective of   whether such date is an Expiration Date in respect of any other Component for   the Transaction) and, notwithstanding anything to the contrary in this   Confirmation or the Definitions, the Relevant Price for such Expiration Date   shall be the prevailing market value per Share determined by the Calculation   Agent in a commercially reasonable manner. “Final Disruption Date” means May 8, 2018. Notwithstanding   the
    

 

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foregoing and anything to the contrary in the   Equity Definitions, if a Market Disruption Event occurs on any Expiration   Date, the Calculation Agent may determine that such Expiration Date is a   Disrupted Day only in part, in which case (i) the Calculation Agent   shall make adjustments to the Number of Warrants for the relevant Component   for which such day shall be the Expiration Date and shall designate the   Scheduled Trading Day determined in the manner described in the immediately   preceding sentence as the Expiration Date for the remaining Warrants for such   Component, and (ii) the VWAP Price for such Disrupted Day shall   be determined by the Calculation Agent based on transactions in the Shares on   such Disrupted Day taking into account the nature and duration of such Market   Disruption Event on such day. Any   Scheduled Trading Day on which, as of the date hereof, the Exchange is   scheduled to close prior to its normal close of trading shall be deemed not   to be a Scheduled Trading Day; if a closure of the Exchange prior to its   normal close of trading on any Scheduled Trading Day is scheduled following   the date hereof, then such Scheduled Trading Day shall be deemed to be a   Disrupted Day in full. Section 6.6 of the Equity Definitions shall not   apply to any Valuation Date occurring on an Expiration Date.
    
	
 
    	
 
    	
 
    
	
 
    	
Market   Disruption Event:
    	
Section 6.3(a) of   the Equity Definitions is hereby amended (A) by deleting the words   “during the one hour period that ends at the relevant Valuation Time, Latest   Exercise Time, Knock-in Valuation Time or Knock-out Valuation Time, as the   case may be,” in clause (ii) thereof and (B) by replacing the words   “or (iii) an Early Closure.” therein with “(iii) an Early Closure,   or (iv) a Regulatory Disruption.”
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Section 6.3(d) of   the Equity Definitions is hereby amended by deleting the remainder of the   provision following the term “Scheduled Closing Time” in the fourth line   thereof.
    
	
 
    	
 
    	
 
    
	
 
    	
Regulatory   Disruption:
    	
Any   event that Dealer, in its discretion, determines makes it appropriate with   regard to any legal, regulatory or self-regulatory requirements or related   policies and procedures, for Dealer to refrain from or decrease any market   activity in connection with the Transaction. Dealer shall notify Issuer as   soon as reasonably practicable that a Regulatory Disruption has occurred and   the Expiration Dates affected by it.
    
	
 
    	
 
    	
 
    
	
 
    	
Automatic   Exercise:
    	
Applicable;   and means that the Number of Warrants for each Component will be deemed to be   automatically exercised at the   Expiration Time on the Expiration Date for such Component unless Dealer   notifies Seller (by telephone or in writing) prior to the Expiration Time on   the Expiration Date that it does not wish Automatic Exercise to occur, in   which case Automatic Exercise will not apply.
    
	
 
    	
 
    	
 
    
	
 
    	
Issuer’s   Telephone Number and Telex and/or Facsimile Number and Contact Details for   purpose of Giving Notice:
    	
To   be provided by Issuer.
    
	
 
    	
 
    	
 
    
	
Settlement   Terms:
    
	
 
    	
 
    	
 
    
	
In respect of any Component:
    

 

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Settlement   Currency:
    	
USD
    
	
 
    	
 
    	
 
    
	
 
    	
Net   Share Settlement:
    	
On   each Settlement Date, Issuer shall deliver to Dealer a number of Shares   equal to the Number of Shares to be Delivered for such Settlement Date to the   account specified by Dealer and pay cash to Dealer in lieu of any fractional   shares valued at the Relevant Price on the Valuation Date corresponding to   such Settlement Date.
    
	
 
    	
 
    	
 
    
	
 
    	
Number   of Shares to be Delivered:
    	
In   respect of any Exercise Date, subject to the last sentence of   Section 9.5 of the Equity Definitions, the product of   (i) the number of Warrants exercised or deemed exercised on such   Exercise Date, (ii) the Warrant Entitlement and   (iii)(A) the excess, if any, of the VWAP Price on the Valuation Date   occurring on such Exercise Date over the Strike Price, divided by   (B) such VWAP Price.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The   Number of Shares to be Delivered shall be delivered by Issuer to Dealer no   later than 4:00 P.M. (local time in New York City) on the relevant   Settlement Date.
    
	
 
    	
 
    	
 
    
	
 
    	
VWAP   Price:
    	
For   any Valuation Date, the Rule 10b-18 dollar volume weighted average price   per Share for such Valuation Date based on transactions executed during such   Valuation Date, as reported on Bloomberg Page “GTAT <Equity> AQR   SEC” (or any successor thereto) or, in the event such price is not so reported   on such Valuation Date for any reason or is manifestly incorrect, as   reasonably determined by the Calculation Agent using a volume weighted   method.
    
	
 
    	
 
    	
 
    
	
 
    	
Other   Applicable Provisions:
    	
The   provisions of Sections 9.1(c), 9.8, 9.9, 9.10, 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 Seller is the Issuer of   the Shares) and 9.12 of the Equity Definitions will be applicable as if   “Physical Settlement” applied to the Transaction.
    
	
 
    	
 
    	
 
    
	
Adjustments:
    
	
 
    	
 
    	
 
    
	
In respect of any Component:
    
	
 
    	
 
    	
 
    
	
 
    	
Method   of Adjustment:
    	
Calculation   Agent Adjustment
    
	
 
    	
 
    	
 
    
	
 
    	
Extraordinary   Dividend:
    	
Any   Dividend that has an ex-dividend date occurring on or after the Trade Date   and on or prior to the date on which Issuer satisfies all of its delivery   obligations hereunder.
    
	
 
    	
 
    	
 
    
	
 
    	
Dividend:
    	
Any   dividend or distribution on the Shares (other than any dividend or   distribution of the type described in Sections 11.2(e)(i),   11.2(e)(ii)(A) or 11.2(e)(ii)(B) of the Equity Definitions).
    
	
 
    	
 
    	
 
    
	
Extraordinary   Events:
    
	
 
    	
 
    	
 
    
	
 
    	
Consequences   of Merger Events:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
(a)
    	
Share-for-Share:
    	
Modified   Calculation Agent Adjustment
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
(b)
    	
Share-for-Other:
    	
Cancellation   and Payment (Calculation Agent Determination)
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
(c)
    	
Share-for-Combined:
    	
Cancellation   and Payment (Calculation Agent Determination)
    
	
 
    	
 
    	
 
    
	
 
    	
Tender   Offer:
    	
Applicable
    

 

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Consequences   of Tender Offers:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
(a)
    	
Share-for-Share:
    	
Modified   Calculation Agent Adjustment
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
(b)
    	
Share-for-Other:
    	
Cancellation   and Payment (Calculation Agent Determination) on that portion of the Other   Consideration that consists of cash; Modified Calculation Agent Adjustment on   the remainder of the Other Consideration.
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
(c)
    	
Share-for-Combined:
    	
Modified   Calculation Agent Adjustment
    
	
 
    	
 
    	
 
    
	
 
    	
Modified   Calculation Agent Adjustment:
    	
If,   in respect of any Merger Event to which Modified Calculation Agent Adjustment   applies, the adjustments to be made in accordance with   Section 12.2(e)(i) of the Equity Definitions would result in Issuer   being different from the issuer of the Shares, then with respect to such   Merger Event, as a condition precedent to the adjustments contemplated in   Section 12.2(e)(i) of the Equity Definitions, Dealer, the Issuer of   the Affected Shares and the entity that will be the Issuer of the New Shares   shall, prior to the Merger Date, have entered into such documentation   containing representations, warranties and agreements relating to securities   law and other issues as requested by Dealer that Dealer has determined, in   its reasonable discretion, to be reasonably necessary or appropriate to allow   Dealer to continue as a party to the Transaction, as adjusted under   Section 12.2(e)(i) of the Equity Definitions, and to preserve its   hedging or hedge unwind activities in connection with the Transaction in a   manner compliant with applicable legal, regulatory or self-regulatory   requirements, or with related policies and procedures applicable to Dealer,   and if such conditions are not met or if the Calculation Agent determines   that no adjustment that it could make under Section 12.2(e)(i) of   the Equity Definitions will produce a commercially reasonable result, then   the consequences set forth in Section 12.2(e)(ii) of the Equity   Definitions shall apply.
    
	
 
    	
 
    	
 
    
	
 
    	
Consequences   of Announcement Events:
    	
Modified   Calculation Agent Adjustment as set forth in Section 12.3(d) of the   Equity Definitions; provided that   references to “Tender Offer” shall be replaced by references to “Announcement   Event” and references to “Tender Offer Date” shall be replaced by references   to “date of such Announcement Event”. An Announcement Event shall be an   “Extraordinary Event” for purposes of the Equity Definitions, to which   Article 12 of the Equity Definitions is applicable.
    
	
 
    	
 
    	
 
    
	
 
    	
Announcement   Event:
    	
(i) The   public announcement of any Merger Event or Tender Offer or the intention to   enter into a Merger Event or Tender Offer, (ii) the public announcement   by Issuer of an intention to solicit or enter into, or to explore strategic   alternatives or other similar undertaking that may include, a Merger Event or   Tender Offer or (iii) any subsequent public announcement of a change to   a transaction or intention that is the subject of an announcement of the type   described in clause (i) or (ii) of this sentence (in each case,   whether such announcement is made by Issuer or a third party).
    
	
 
    	
 
    	
 
    
	
 
    	
Announcement   Date:
    	
The   definition of “Announcement Date” in Section 12.1 of the Equity   Definitions is hereby amended by (i) replacing the words “a
    

 

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firm”   with the word “any” in the second and fourth lines thereof,   (ii) replacing the word “leads to the” with the words “, if completed,   would lead to a” in the third and the fifth lines thereof,   (iii) replacing the words “voting shares” with the word “Shares” in the   fifth line thereof, and (iv) inserting the words “by any entity” after   the word “announcement” in the second and the fourth lines thereof.
    
	
 
    	
 
    	
 
    
	
 
    	
New   Shares:
    	
In   the definition of New Shares in Section 12.1(i) of the Equity   Definitions, (a) the text in clause (i) thereof shall be deleted in its   entirety (including the word “and” following such clause (i)) and replaced   with “publicly quoted, traded or listed on any of the New York Stock   Exchange, The NASDAQ Global Select Market or The NASDAQ Global Market (or   their respective successors),” and (b) the phrase “and (iii) issued   by a corporation organized under the laws of the United States, any State   thereof or the District of Columbia” shall be inserted immediately prior to   the period.
    
	
 
    	
 
    	
 
    
	
 
    	
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
    

 

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terminate   the Transaction”, the words “or a portion of the Transaction affected by such   Hedging Disruption”.
    
	
 
    	
 
    	
 
    
	
 
    	
(e)
    	
Increased   Cost of Hedging:
    	
Applicable
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
(f)
    	
Loss   of Stock Borrow:
    	
Applicable
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Maximum   Stock Loan Rate:
    	
As   provided in Annex A to this Confirmation.
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
(g)
    	
Increased   Cost of Stock Borrow:
    	
Applicable
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Initial   Stock Loan Rate:
    	
As   provided in Annex A to this Confirmation.
    
	
 
    	
 
    	
 
    
	
 
    	
Hedging   Party:
    	
Dealer   for all applicable Potential Adjustment Events and Extraordinary Events
    
	
 
    	
 
    	
 
    
	
 
    	
Determining   Party:
    	
Dealer   for all applicable Extraordinary Events
    
	
 
    	
 
    	
 
    
	
 
    	
Non-Reliance:
    	
Applicable
    
	
 
    	
 
    	
 
    
	
 
    	
Agreements   and Acknowledgments Regarding Hedging Activities:
    	
Applicable
    
	
 
    	
 
    	
 
    
	
 
    	
Additional   Acknowledgments:
    	
Applicable
    
	
 
    	
 
    	
 
    
	
 
    	
3.
    	
Calculation Agent:
    	
Dealer
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
4.
    	
Account Details:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Dealer Payment Instructions:
    	
UBS AG Stamford
    
	
 
    	
 
    	
ABA# 026-007-993
    
	
 
    	
 
    	
F/O UBS AG London Branch
    
	
 
    	
 
    	
A/C#   101-WA-140007-000
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Issuer Payment Instructions:
    	
To be provided by Issuer.
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
5.
    	
Offices:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Office of Dealer for the Transaction is: New York
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The   Office of Issuer for the Transaction is: Not applicable
    
	
 
    	
 
    
	
 
    	
6.
    	
Notices:
    
	
 
    	
 
    	
 
    
	
 
    	
(a)
    	
Address   for notices or communications to Issuer 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
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
(b)
    	
Address   for notices or communications to Dealer for purposes of this Confirmation:
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
To:
    	
UBS   AG, London Branch
    
	
 
    	
 
    	
 
    	
c/o   UBS AG, Stamford Branch
    
	
 
    	
 
    	
 
    	
677   Washington Boulevard
    
	
 
    	
 
    	
 
    	
Stamford,   CT 06901
    
	
 
    	
 
    	
Attn:
    	
Tracy Johnson / Tim Clary
    
	
 
    	
 
    	
Facsimile:
    	
203-719-0538
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
with   copies to:
    	
Equities   Legal Department
    
	
 
    	
 
    	
 
    	
677   Washington Boulevard
    
	
 
    	
 
    	
 
    	
Stamford,   CT 06901
    
	
 
    	
 
    	
Attn:
    	
Gordon   Kiesling and Hina Mehta
    
	
 
    	
 
    	
Telephone:
    	
(203)   719-0268
    
						

 

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Facsimile:
    	
(203)   719-5627
    

 

7.     Representations, Warranties and Agreements:

 

(a)           In addition to the representations and warranties in the Agreement and those contained elsewhere herein, Issuer 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 Issuer gives Dealer a Notice of Cash Payment Termination under (and as defined in) Section 8(a) below, (A) none of Issuer and its officers and directors is aware of any material nonpublic information regarding Issuer or the Shares and (B) all reports and other documents filed by Issuer 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.

 

(ii)           Without limiting the generality of Section 13.1 of the Equity Definitions, Issuer 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.

 

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

 

(iv)          Issuer 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.

 

(v)           Issuer 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.

 

(vi)          On the Trade Date, (A) the assets of Issuer at their fair valuation exceed the liabilities of Issuer, including contingent liabilities, (B) the capital of Issuer is adequate to conduct the business of Issuer and (C) Issuer has the ability to pay its debts and obligations as such debts mature and does not intend to, or does not believe that it will, incur debt beyond its ability to pay as such debts mature.

 

(vii)         Issuer shall not take any action to decrease the number of Available Shares below the Capped Number (each as defined below).

 

(viii)        The representations and warranties of Issuer set forth in Section 3 of the Agreement and Section 3 of the Underwriting Agreement (the “Underwriting Agreement”) dated September 24, 2012 among Issuer, 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.

 

(ix)           Issuer 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.

 

(x)            During the period starting on the first Expiration Date and ending on the last Expiration Date (the “Settlement Period”), the Shares or securities that are convertible into, or exchangeable or exercisable for, Shares will not be subject to a “restricted period,” as such term is defined in Regulation M under the Exchange Act (“Regulation M”).

 

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(xi)           On each day during the Settlement Period, neither Issuer nor any “affiliate” or “affiliated purchaser” (each as defined in Rule 10b-18 under the Exchange Act (“Rule 10b-18”)) 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.

 

(xii)          On the Trade Date and at all times until termination or earlier expiration of the Transaction, (A) a number of Shares equal to the Capped Number have been reserved for issuance by all required corporate action of Issuer, (B) the Shares issuable upon exercise of the Warrants (the “Warrant Shares”) have been duly authorized and, when delivered against payment therefor (which may include Net Share Settlement in lieu of cash) and otherwise as contemplated by the terms of the Warrant following the exercise of the Warrant in accordance with the terms and conditions of the Warrant, will be validly issued, fully-paid and non-assessable and (C) the issuance of the Warrant Shares will not be subject to any preemptive or similar rights.

 

(xiii)         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.

 

(xiv)        Issuer (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 Issuer 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 Issuer 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, Dealer represents and warrants to Issuer 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 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)           Issuer 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 Title 11 of the United States Code (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)           Issuer 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 and Section 7(a)(xii) of this Confirmation (replacing, solely for these purposes, the words “On the Trade Date and at all times until termination or earlier expiration of the Transaction” with the words “On the Effective Date”).

 

(f)            Issuer and Dealer agree and acknowledge that Shares delivered by the Issuer to Dealer pursuant to the terms of the Transaction may not have been registered under the Securities Act.

 

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8.  Other Provisions:

 

(a)           Alternative Calculations and Payment on Early Termination and on Certain Extraordinary Events.  If Issuer shall owe Dealer any amount pursuant to Sections 12.2, 12.3, 12.6, 12.7 or 12.9 of the Equity Definitions or pursuant to Section 6(d)(ii) of the Agreement (a “Payment Obligation”), Issuer shall satisfy any such Payment Obligation by the Share Termination Alternative (as defined below), unless (a) Issuer 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 Merger Date, Tender Offer 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 Sections 12.2, 12.3, 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 Merger Date, the Tender Offer 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 Issuer shall deliver to Dealer the Share Termination Delivery   Property on the date on which the Payment Obligation would otherwise be due   pursuant to Section 12.7 or 12.9 of the Equity Definitions or   Section 6(d)(ii) of the Agreement, as applicable (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 Issuer 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, Merger Event or Tender Offer, 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, Merger Event or Tender Offer, as applicable. If such   Insolvency, Nationalization, Merger Event or Tender Offer 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, 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 Seller is the issuer of the Shares or any portion of   the Share Termination Delivery Units) and 9.12 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”.
    

 

(b)           Private Placement Procedures.  (i)  If, in the reasonable judgment of Dealer, for any reason, any Shares or any securities of Issuer or its affiliates comprising any Share Termination Delivery Units deliverable to Dealer

 

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hereunder (any such Shares or securities, “Delivered Securities”) would not be immediately freely transferable by Dealer under Rule 144 under the Securities Act, then the provisions set forth in this Section 8(b) shall apply.  In such event, Issuer shall deliver additional Delivered Securities so that the value of such Delivered Securities, as determined by the Calculation Agent to reflect an appropriate liquidity discount, equals the value of the number of Delivered Securities that would otherwise be deliverable if such Delivered Securities were freely tradeable (without prospectus delivery) upon receipt by Dealer (such value, the “Freely Tradeable Value”).  (For the avoidance of doubt, as used in this paragraph (b) only, the term “Issuer” shall mean the issuer of the relevant securities, as the context shall require.)

 

(ii) (A)    Dealer (or an Affiliate of Dealer designated by Dealer) and any potential institutional purchaser of any such Delivered Securities from Dealer or such Affiliate identified by Dealer shall be afforded a commercially reasonable opportunity to conduct a due diligence investigation in compliance with applicable law with respect to Issuer customary in scope for private placements of equity securities (including, without limitation, the right to have made available to them for inspection all financial and other records, pertinent corporate documents and other information reasonably requested by them);

 

(B)           Dealer (or an Affiliate of Dealer designated by Dealer) and Issuer shall enter into an agreement (a “Private Placement Agreement”) on commercially reasonable terms in connection with the private placement of such Delivered Securities by Issuer to Dealer or such Affiliate and the private resale of such shares by Dealer or such Affiliate, substantially similar to private placement purchase agreements customary for private placements of equity securities, in form and substance commercially reasonably satisfactory to Dealer and Issuer, which Private Placement Agreement shall include, without limitation, provisions substantially similar to those contained in such private placement purchase agreements relating to the indemnification of, and contribution in connection with the liability of, Dealer and its Affiliates and Issuer, shall provide for the payment by Issuer of all expenses in connection with such resale, including all fees and expenses of counsel for Dealer, shall contain representations, warranties and agreements of Issuer reasonably necessary or advisable to establish and maintain the availability of an exemption from the registration requirements of the Securities Act for such resales, and shall use best efforts to provide for the delivery of accountants’ “comfort letters” to Dealer or such Affiliate with respect to the financial statements and certain financial information contained in or incorporated by reference into the offering memorandum prepared for the resale of such Shares; and

 

(C)           Issuer agrees that any Delivered Securities so delivered to Dealer, (i) may be transferred by and among Dealer and its Affiliates, and Issuer shall effect such transfer without any further action by Dealer and (ii) after the minimum “holding period” within the meaning of Rule 144(d) under the Securities Act has elapsed with respect to such Delivered Securities, Issuer shall promptly remove, or cause the transfer agent for such Shares or securities to remove, any legends referring to any such restrictions or requirements from such Delivered Securities upon delivery by Dealer (or such Affiliate of Dealer) to Issuer or such transfer agent of seller’s and broker’s representation letters customarily delivered by Dealer in connection with resales of restricted securities pursuant to Rule 144 under the Securities Act, without any further requirement for the delivery of any certificate, consent, agreement, opinion of counsel, notice or any other document, any transfer tax stamps or payment of any other amount or any other action by Dealer (or such affiliate of Dealer).

 

(D)          Issuer shall not take, or cause to be taken, any action that would make unavailable either the exemption pursuant to Section 4(2) of the Securities Act for the sale by Issuer to Dealer (or any affiliate designated by Dealer) of the Shares or Share Termination Delivery Units, as the case may be, or the exemption pursuant to Section 4(1) or Section 4(3) of the Securities Act for resales of the Shares or Share Termination Delivery Units, as the case may be, by Dealer (or any such affiliate of Dealer).

 

(c)           Make-whole. Dealer or its affiliate may sell such Shares or Share Termination Delivery Units delivered in satisfaction of a Payment Obligation, as the case may be, during a period (the “Resale Period”) commencing on the Exchange Business Day following delivery of such Shares or Share Termination Delivery Units, as the case may be, and ending on the Exchange Business Day on which Dealer completes the sale of all such Shares or Share Termination Delivery Units, as the case may be, or a sufficient number of Shares or Share Termination Delivery Units, as the case may be, so that the realized net proceeds of such sales exceed the Freely Tradeable Value (such amount of the Freely Tradeable Value, the “Required Proceeds”).  If any of such delivered Shares or Share Termination Delivery Units remain after such realized net proceeds exceed the Required Proceeds, Dealer shall return such remaining Shares or Share Termination Delivery Units to Issuer.  If the Required Proceeds exceed the realized net proceeds from such resale, Issuer shall transfer to Dealer by the open of the regular trading session on the Exchange on the Exchange Trading Day

 

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immediately following the last day of the Resale Period the amount of such excess (the “Additional Amount”) in cash or in a number of additional Shares or Share Termination Delivery Units, as the case may be, (“Make-whole Shares”) in an amount that, based on the Relevant Price on the last day of the Resale Period (as if such day was the “Valuation Date” for purposes of computing such Relevant Price), has a dollar value equal to the Additional Amount.  The Resale Period shall continue to enable the sale of the Make-whole Shares in the manner contemplated by this Section 8(c).  This provision shall be applied successively until the Additional Amount is equal to zero, subject to Section 8(e).  For the avoidance of doubt, the Dealer will use commercially reasonable efforts to sell such Shares or Share Termination Delivery Units, as the case may be, for a price equal to their fair market value.

 

(d)                                 Beneficial Ownership. Notwithstanding anything to the contrary in the Agreement or this Confirmation, in no event shall Dealer be entitled to receive, or shall be deemed to receive, any Shares in connection with the Transaction if, immediately upon giving effect to such receipt of such Shares, (i) Dealer’s Beneficial Ownership would be equal to or greater than 7.5% of the outstanding Shares, (ii) Dealer, or any “affiliate” or “associate” of Dealer, would be an “interested stockholder” of Issuer, as all such terms are defined in 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 Issuer 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 Issuer or any contract or agreement to which Issuer is a party, in each case minus (y) 1% of the number of Shares outstanding on the date of determination (each of clause (i), (ii) and (iii) above, an “Ownership Limitation”). If any delivery owed to Dealer hereunder is not made, in whole or in part, as a result of an Ownership Limitation, Dealer’s right to receive such delivery shall not be extinguished and Issuer shall make such delivery as promptly as practicable after, but in no event later than one Exchange Business Day after, Dealer gives notice to Issuer that such delivery would not result in any of such Ownership Limitations being breached.  “Dealer’s Beneficial Ownership” means the “beneficial ownership” (within the meaning of Section 13 of the Exchange Act and the rules promulgated thereunder (collectively, “Section 13”)) of Shares, without duplication, by Dealer, together with any of its affiliates or other person subject to aggregation with Dealer under Section 13 for purposes of “beneficial ownership”, or by 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”) (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).  Notwithstanding anything in the Agreement or this Confirmation to the contrary, Dealer (or the affiliate designated by Dealer pursuant to Section 8(l) below) shall not become the record or beneficial owner, or otherwise have any rights as a holder, of any Shares that Dealer (or such affiliate) is not entitled to receive at any time pursuant to this Section 8(d), until such time as such Shares are delivered pursuant to this Section 8(d).

 

(e)                                  Limitations on Settlement by Issuer.  Notwithstanding anything herein or in the Agreement to the contrary, in no event shall Issuer be required to deliver Shares in connection with the Transaction in excess of the Capped Number of Shares (as provided in Annex A to this Confirmation), subject to adjustment from time to time in accordance with the provisions of this Confirmation or the Definitions resulting from actions of Issuer or events within Issuer’s control (the “Capped Number”).  Issuer represents and warrants to Dealer (which representation and warranty shall be deemed to be repeated on each day that the Transaction is outstanding) that the Capped Number is equal to or less than the number of authorized but unissued Shares of the Issuer that are not reserved for future issuance in connection with transactions in the Shares (other than the Transaction) on the date of the determination of the Capped Number (such Shares, the “Available Shares”).  In the event Issuer shall not have delivered the full number of Shares otherwise deliverable as a result of this Section 8(e) (the resulting deficit, the “Deficit Shares”), Issuer shall be continually obligated to deliver, from time to time until the full number of Deficit Shares have been delivered pursuant to this paragraph, Shares when, and to the extent, that (i) Shares are repurchased, acquired or otherwise received by Issuer or any of its subsidiaries after the Trade Date (whether or not in exchange for cash, fair value or any other consideration), (ii) authorized and unissued Shares reserved for issuance in respect of other transactions prior to such date which prior to the relevant date become no longer so reserved or (iii) Issuer additionally authorizes any unissued Shares that are not reserved for other transactions.  Issuer shall immediately notify Dealer of the occurrence of any of the foregoing events

 

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(including the number of Shares subject to clause (i), (ii) or (iii) and the corresponding number of Shares to be delivered) and promptly deliver such Shares thereafter.

 

(f)                                    Right to Extend.  Dealer may postpone any Exercise Date or Settlement Date or any other date of valuation or delivery with respect to some or all of the relevant Warrants (in which event the Calculation Agent shall make appropriate adjustments to the Number of Shares to be Delivered with respect to one or more Components), 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 Issuer or an affiliated purchaser of Issuer, be in compliance with applicable legal, regulatory or self-regulatory requirements, or with related policies and procedures applicable to Dealer.

 

(g)                                 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 Issuer’s bankruptcy.  For the avoidance of doubt, the parties agree that the preceding sentence shall not apply at any time other than during Issuer’s bankruptcy to any claim arising as a result of a breach by Issuer 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 Issuer herein under or pursuant to any other agreement.

 

(h)                                 Amendments to Equity Definitions.  The following amendments shall be made to the Equity Definitions:

 

(i)                                     Section 11.2(a) of the Equity Definitions is hereby amended by deleting the words “a diluting or concentrative” and replacing them with the words “an”; and adding the phrase “or Warrants” at the end of the sentence.

 

(ii)                                  The first sentence of Section 11.2(c) of the Equity Definitions, prior to clause (A) thereof, is hereby amended to read as follows: ‘(c) If “Calculation Agent Adjustment” is specified as the Method of Adjustment in the related Confirmation of a Share Option Transaction, then following the announcement or occurrence of any Potential Adjustment Event, the Calculation Agent will determine whether such Potential Adjustment Event has an effect on the theoretical value of the relevant Shares or options on the Shares and, if so, will (i) make appropriate adjustment(s), if any, to any one or more of:’ and, the portion of such sentence immediately preceding clause (ii) thereof is hereby amended by deleting the words “diluting or concentrative” and the words “(provided that no adjustments will be made to account solely for changes in volatility, expected dividends, stock loan rate or liquidity relative to the relevant Shares)” and replacing such latter phrase with the words “(and, for the avoidance of doubt, adjustments may be made to account solely for changes in volatility, expected dividends, stock loan rate or liquidity relative to the relevant Shares)”;

 

(iii)                               Section 11.2(e)(vii) of the Equity Definitions is hereby amended by deleting the words “diluting or concentrative” and replacing them with “a material” and adding the phrase “or Warrants” at the end of the sentence;

 

(iv)                              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.”;

 

(v)                                 Section 12.9(b)(iv) of the Equity Definitions is hereby amended by (A) deleting (1) subsection (A) in its entirety, (2) the phrase “or (B)” following subsection (A) and (3) the phrase “in each case” in subsection (B); and (B) deleting the phrase “neither the Non-Hedging Party nor the Lending Party lends Shares in the amount of the Hedging Shares or” in the penultimate sentence; and

 

(vi)                              Section 12.9(b)(v) of the Equity Definitions is hereby amended by (A) adding the word “or” immediately before subsection “(B)” and deleting the comma at the end of subsection (A); and (B)(1) deleting subsection (C) in its entirety, (2) deleting the word “or” immediately preceding subsection (C) and (3) replacing in the penultimate sentence the words “either party” with “the Hedging Party” and (4) deleting clause (X) in the final sentence.

 

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(i)                                     Transfer and Assignment.  Dealer may transfer or assign its rights and obligations hereunder and under the Agreement, in whole or in part, at any time to any person or entity whatsoever without the consent of Issuer; provided, however, that the transferee or assignee shall not be entitled to receive any greater payment of additional amounts under Section 2(d)(i)(4) of the Agreement than Dealer would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Tax Law that occurs after the date of the transfer or assignment.  At any time at which any Ownership Limitation or a Hedging Disruption exists, if Dealer, in its discretion, is unable to effect a transfer or assignment to a third party after using its commercially reasonable efforts on pricing terms and within a time period reasonably acceptable to Dealer such that an Ownership Limitation 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 Ownership Limitation 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) Issuer 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.

 

(j)                                     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.

 

(k)                                  Disclosure.  Effective from the date of commencement of discussions concerning the Transaction, Issuer 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 Issuer relating to such tax treatment and tax structure.

 

(l)                                     Designation by Dealer.  Dealer has the right to assign any or all of its rights and obligations under the Transaction to purchase, sell, receive or deliver any Shares to any of its affiliates; provided that such assignment shall only occur when it has become obligatory that the Transaction be settled by the transfer of Shares; and provided  further that Issuer shall have recourse to Dealer in the event of failure by the assignee to perform any of such obligations hereunder.  Notwithstanding the foregoing, the recourse to Dealer shall be limited to recoupment of Issuer’s monetary damages and Issuer hereby waives any right to seek specific performance by Dealer of its obligations hereunder.  Such failure after any applicable grace period shall be deemed to be an Additional Termination Event, such Transaction shall be the only Affected Transaction and Dealer shall be the only Affected Party.

 

(m)                               Additional Termination Events.  The occurrence of any of the following shall constitute an Additional Termination Event with respect to which the Transaction shall be the sole Affected Transaction and Issuer shall be the sole Affected Party; provided that with respect to any Additional Termination Event, Dealer may choose to treat part of the Transaction as the sole Affected Transaction, and, upon the termination of the Affected Transaction, a Transaction with terms identical to those set forth herein except with a Number of Warrants equal to the unaffected number of Warrants shall be treated for all purposes as the Transaction, which shall remain in full force and effect:

 

(i)                                      Dealer reasonably determines that it is advisable to terminate a portion of the Transaction so that Dealer’s related hedging activities will comply with applicable securities laws, rules or regulations or related policies and procedures of Dealer (whether or not such requirements, policies or procedures are imposed by law or have been voluntarily adopted by Dealer, so long as such requirements, policies and procedures are generally applicable to transactions similar to the Transaction);

 

(ii)                                   a “person” or “group” within the meaning of Section 13(d) of the Exchange Act, other than Issuer, its subsidiaries and the employee benefit plans of Issuer or its subsidiaries, files a Schedule TO or any schedule, form or report under the Exchange Act disclosing that such person or group has become the direct or indirect “beneficial owner,” as defined in Rule 13d-3 under the Exchange Act, of the common equity of Issuer representing more than 50% of the voting power the common equity of Issuer;

 

(iii)                                the consummation of (A) any recapitalization, reclassification or change of the Shares (other than changes resulting from a subdivision or combination) as a result of which the Shares would be converted

 

14

 

into, or exchanged for, stock, other securities, other property or assets; (B) any share exchange, consolidation or merger of Issuer pursuant to which the Shares will be converted into cash, securities or other property; or (C) any sale, lease or other transfer in one transaction or a series of transactions of all or substantially all of the consolidated assets of Issuer and its subsidiaries, taken as a whole, to any person other than one of Issuer’s subsidiaries;

 

(iv)                               the stockholders of Issuer approve any plan or proposal for the liquidation or dissolution of Issuer; or

 

(v)                                  the Shares cease to be listed or quoted on any of The NASDAQ Global Select Market, The NASDAQ Global Market or the New York Stock Exchange (or any of their respective successors).

 

Notwithstanding the foregoing, any transaction set forth in clauses (ii), (iii) or (v) above will not constitute an Additional Termination Event if at least 90% of the consideration received or to be received by the holders of the Shares, excluding cash payments for fractional shares and cash payments made pursuant to dissenters’ appraisal rights, in connection with such transaction or transactions consists of shares of common stock that are listed or quoted on any of the New York Stock Exchange, The NASDAQ Global Select Market or The NASDAQ Global Market (or any of their respective successors) or will be so listed or quoted when issued or exchanged in connection with such transaction or transactions and as a result of such transaction or transactions the Shares will consist of such consideration, excluding cash payments for fractional Shares.

 

(n)                                 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.

 

(o)                                 Effectiveness.  If, prior to the Effective Date, Dealer reasonably determines, based on the advice of counsel, that it is advisable to cancel the Transaction because of concerns that Dealer’s related hedging activities could be viewed as not complying with applicable securities laws, rules or regulations, the Transaction shall be cancelled and shall not become effective, and neither party shall have any obligation to the other party in respect of the Transaction.

 

(p)                                 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, Loss of Stock Borrow, Increased Cost of Stock Borrow, an Excess Ownership Position or Illegality (as defined in the Agreement)).

 

(q)                                 Waiver of Trial by Jury.  EACH OF ISSUER 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.

 

(r)                                    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.

 

15

 

(s)                                  Role of Agent.  Each party agrees and acknowledges that Agent is acting as agent for both parties but does not guarantee the performance of either party and neither Dealer nor Issuer shall contact the other with respect to any matter relating to the Transaction without the direct involvement of Agent; (ii) Agent is not a member of the Securities Investor Protection Corporation; (iii) Agent, Dealer and Issuer each hereby acknowledges that any transactions by Dealer or Agent in the Shares will be undertaken by Dealer or Agent, as the case may, as principal for its own account; and (iv) all of the actions to be taken by Dealer and Agent in connection with the Transaction, including but not limited to any exercise of any rights with respect to the Transactions, shall be taken by Dealer or Agent independently and without any advance or subsequent consultation with Issuer; and (iv) Agent is hereby authorized to act as agent for Issuer only to the extent required to satisfy the requirements of Rule 15a-6 under the Exchange Act in respect of the Transactions described hereunder.  For the avoidance of doubt, any performance by Issuer of its obligations (including notice obligations) through or by means of Agent shall constitute good performance of Issuer’s obligations hereunder to Dealer when Issuer 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 Issuer through or by means of Agent shall only constitute good performance of Dealer’s obligations hereunder to the extent Agent actually performs such obligations.

 

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

 

16

 

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

 

	
 
    	
Yours   faithfully,
    
	
 
    	
 
    
	
 
    	
UBS AG, LONDON BRANCH
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Tracy Johnson
    
	
 
    	
 
    	
Name:   Tracy Johnson
    
	
 
    	
 
    	
Title:   Managing Director
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Lisa Woo
    
	
 
    	
 
    	
Name:   Lisa Woo
    
	
 
    	
 
    	
Title:   Associate Director
    
	
 
    	
 
    
	
 
    	
UBS   AG, STAMFORD BRANCH, as agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Tracy Johnson
    
	
 
    	
 
    	
Name:   Tracy Johnson
    
	
 
    	
 
    	
Title:   Managing Director
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Lisa Woo
    
	
 
    	
 
    	
Name:   Lisa Woo
    
	
 
    	
 
    	
Title:   Associate 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 Additional Issuer Warrant Transaction

 

 

 

Annex A

 

For each Component of the Transaction, the Number of Warrants and Expiration Date is set forth below.

 

	
Component Number
    	
 
    	
Number of Warrants
    	
 
    	
Expiration Date
    
	
1
    	
 
    	
8,512
    	
 
    	
January 2, 2018
    
	
2
    	
 
    	
8,512
    	
 
    	
January 3, 2018
    
	
3
    	
 
    	
8,512
    	
 
    	
January 4, 2018
    
	
4
    	
 
    	
8,512
    	
 
    	
January 5, 2018
    
	
5
    	
 
    	
8,512
    	
 
    	
January 8, 2018
    
	
6
    	
 
    	
8,512
    	
 
    	
January 9, 2018
    
	
7
    	
 
    	
8,512
    	
 
    	
January 10, 2018
    
	
8
    	
 
    	
8,512
    	
 
    	
January 11, 2018
    
	
9
    	
 
    	
8,512
    	
 
    	
January 12, 2018
    
	
10
    	
 
    	
8,512
    	
 
    	
January 16, 2018
    
	
11
    	
 
    	
8,512
    	
 
    	
January 17, 2018
    
	
12
    	
 
    	
8,512
    	
 
    	
January 18, 2018
    
	
13
    	
 
    	
8,512
    	
 
    	
January 19, 2018
    
	
14
    	
 
    	
8,512
    	
 
    	
January 22, 2018
    
	
15
    	
 
    	
8,512
    	
 
    	
January 23, 2018
    
	
16
    	
 
    	
8,512
    	
 
    	
January 24, 2018
    
	
17
    	
 
    	
8,512
    	
 
    	
January 25, 2018
    
	
18
    	
 
    	
8,512
    	
 
    	
January 26, 2018
    
	
19
    	
 
    	
8,512
    	
 
    	
January 29, 2018
    
	
20
    	
 
    	
8,512
    	
 
    	
January 30, 2018
    
	
21
    	
 
    	
8,512
    	
 
    	
January 31, 2018
    
	
22
    	
 
    	
8,512
    	
 
    	
February 1, 2018
    
	
23
    	
 
    	
8,512
    	
 
    	
February 2, 2018
    
	
24
    	
 
    	
8,512
    	
 
    	
February 5, 2018
    
	
25
    	
 
    	
8,512
    	
 
    	
February 6, 2018
    
	
26
    	
 
    	
8,512
    	
 
    	
February 7, 2018
    
	
27
    	
 
    	
8,512
    	
 
    	
February 8, 2018
    
	
28
    	
 
    	
8,512
    	
 
    	
February 9, 2018
    
	
29
    	
 
    	
8,512
    	
 
    	
February 12, 2018
    
	
30
    	
 
    	
8,512
    	
 
    	
February 13, 2018
    
	
31
    	
 
    	
8,512
    	
 
    	
February 14, 2018
    
	
32
    	
 
    	
8,512
    	
 
    	
February 15, 2018
    
	
33
    	
 
    	
8,512
    	
 
    	
February 16, 2018
    
	
34
    	
 
    	
8,512
    	
 
    	
February 20, 2018
    
	
35
    	
 
    	
8,512
    	
 
    	
February 21, 2018
    
	
36
    	
 
    	
8,512
    	
 
    	
February 22, 2018
    
	
37
    	
 
    	
8,512
    	
 
    	
February 23, 2018
    
	
38
    	
 
    	
8,512
    	
 
    	
February 26, 2018
    
	
39
    	
 
    	
8,512
    	
 
    	
February 27, 2018
    
	
40
    	
 
    	
8,512
    	
 
    	
February 28, 2018
    
	
41
    	
 
    	
8,512
    	
 
    	
March 1, 2018
    
	
42
    	
 
    	
8,512
    	
 
    	
March 2, 2018
    
	
43
    	
 
    	
8,512
    	
 
    	
March 5, 2018
    
	
44
    	
 
    	
8,512
    	
 
    	
March 6, 2018
    
	
45
    	
 
    	
8,512
    	
 
    	
March 7, 2018
    
	
46
    	
 
    	
8,512
    	
 
    	
March 8, 2018
    
	
47
    	
 
    	
8,512
    	
 
    	
March 9, 2018
    
	
48
    	
 
    	
8,512
    	
 
    	
March 12, 2018
    
	
49
    	
 
    	
8,512
    	
 
    	
March 13, 2018
    
	
50
    	
 
    	
8,512
    	
 
    	
March 14, 2018
    
	
51
    	
 
    	
8,512
    	
 
    	
March 15, 2018
    

 

Annex A-1

 

	
52
    	
 
    	
8,512
    	
 
    	
March 16, 2018
    
	
53
    	
 
    	
8,512
    	
 
    	
March 19, 2018
    
	
54
    	
 
    	
8,512
    	
 
    	
March 20, 2018
    
	
55
    	
 
    	
8,512
    	
 
    	
March 21, 2018
    
	
56
    	
 
    	
8,512
    	
 
    	
March 22, 2018
    
	
57
    	
 
    	
8,512
    	
 
    	
March 23, 2018
    
	
58
    	
 
    	
8,512
    	
 
    	
March 26, 2018
    
	
59
    	
 
    	
8,512
    	
 
    	
March 27, 2018
    
	
60
    	
 
    	
8,512
    	
 
    	
March 28, 2018
    
	
61
    	
 
    	
8,512
    	
 
    	
March 29, 2018
    
	
62
    	
 
    	
8,512
    	
 
    	
April 2, 2018
    
	
63
    	
 
    	
8,512
    	
 
    	
April 3, 2018
    
	
64
    	
 
    	
8,512
    	
 
    	
April 4, 2018
    
	
65
    	
 
    	
8,512
    	
 
    	
April 5, 2018
    
	
66
    	
 
    	
8,512
    	
 
    	
April 6, 2018
    
	
67
    	
 
    	
8,512
    	
 
    	
April 9, 2018
    
	
68
    	
 
    	
8,512
    	
 
    	
April 10, 2018
    
	
69
    	
 
    	
8,512
    	
 
    	
April 11, 2018
    
	
70
    	
 
    	
8,512
    	
 
    	
April 12, 2018
    
	
71
    	
 
    	
8,512
    	
 
    	
April 13, 2018
    
	
72
    	
 
    	
8,512
    	
 
    	
April 16, 2018
    
	
73
    	
 
    	
8,512
    	
 
    	
April 17, 2018
    
	
74
    	
 
    	
8,512
    	
 
    	
April 18, 2018
    
	
75
    	
 
    	
8,512
    	
 
    	
April 19, 2018
    
	
76
    	
 
    	
8,512
    	
 
    	
April 20, 2018
    
	
77
    	
 
    	
8,512
    	
 
    	
April 23, 2018
    
	
78
    	
 
    	
8,512
    	
 
    	
April 24, 2018
    
	
79
    	
 
    	
8,512
    	
 
    	
April 25, 2018
    
	
80
    	
 
    	
8,574
    	
 
    	
April 26, 2018
    

 

	
Strike Price:
    	
USD9.9328
    
	
 
    	
 
    
	
Premium:
    	
USD993,267
    
	
 
    	
 
    
	
Maximum Stock Loan Rate:
    	
200   basis points
    
	
 
    	
 
    
	
Initial Stock Loan Rate:
    	
25   basis points
    
	
 
    	
 
    
	
Capped Number of Shares:
    	
1,362,044
    

 

2Exhibit 10.14

 

	
 
    	
September 25, 2012
    
	
 
    	
 
    
	
To:
    	
GT Advanced Technologies Inc.
    
	
 
    	
20 Trafalgar Square
    
	
 
    	
Nashua, NH 03063
    
	
 
    	
Attn: Hoil Kim, General Counsel
    
	
 
    	
Telephone: (603) 883-5200
    
	
 
    	
 
    
	
From:
    	
Morgan Stanley & Co. International plc
    
	
 
    	
c/o Morgan Stanley Bank, N.A.
    
	
 
    	
c/o Morgan Stanley
    
	
 
    	
750 Seventh Avenue, 29th Floor
    
	
 
    	
New York, NY 10019
    
	
 
    	
Attn:
    	
Robert Poselle
    
	
 
    	
Telephone:
    	
212-276-2427
    
	
 
    	
Facsimile:
    	
212-507-0724
    
	
 
    	
 
    
	
Re:
    	
Additional Issuer Warrant 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 Morgan Stanley & Co. International plc (“Dealer”) and GT Advanced Technologies Inc. (“Issuer”).  Dealer is acting as principal and Morgan Stanley, N.A. (“Agent”), its affiliate, is acting as agent for Dealer and Issuer for the Transaction under this Confirmation.  This communication constitutes a “Confirmation” as referred to in the ISDA Master Agreement specified below.  Dealer is not a member of the Securities Investor Protection Corporation.

 

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.  For purposes of the Equity Definitions, each reference herein to a Warrant shall be deemed to be a reference to a Call Option or an Option, as context requires.

 

This Confirmation evidences a complete and binding agreement between Dealer and Issuer 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 Issuer 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 is a Warrant Transaction, which shall be considered 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:
    	
 
    	
September 28, 2012, or such other date as   agreed between the parties, subject to Section 8(o) below.
    

 

 

	
Components:
    	
 
    	
The   Transaction will be divided into individual Components, each with the terms   set forth in this Confirmation, and, in particular, with the Number of   Warrants and Expiration Date set forth in this Confirmation. The payments and   deliveries to be made upon settlement of the Transaction will be determined   separately for each Component as if each Component were a separate   Transaction under the Agreement.
    
	
 
    	
 
    	
 
    
	
Warrant   Style:
    	
 
    	
European
    
	
 
    	
 
    	
 
    
	
Warrant   Type:
    	
 
    	
Call
    
	
 
    	
 
    	
 
    
	
Seller:
    	
 
    	
Issuer
    
	
 
    	
 
    	
 
    
	
Buyer:
    	
 
    	
Dealer
    
	
 
    	
 
    	
 
    
	
Shares:
    	
 
    	
The   common stock of Issuer, par value USD0.01 per share (Ticker Symbol: “GTAT”).
    
	
 
    	
 
    	
 
    
	
Number   of Warrants:
    	
 
    	
For   each Component, as provided in Annex A to this Confirmation.
    
	
 
    	
 
    	
 
    
	
Warrant Entitlement:
    	
 
    	
One Share per Warrant
    
	
 
    	
 
    	
 
    
	
Strike   Price:
    	
 
    	
As   provided in Annex A to this Confirmation.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Notwithstanding anything to the contrary in the   Agreement, this Confirmation or the Equity Definitions, in no event shall the   Strike Price be subject to adjustment to the extent that, after giving effect   to such adjustment, the Strike Price would be less than USD 5.92, except for   any adjustment pursuant to the terms of this Confirmation and the Equity   Definitions in connection with stock splits or similar changes to Issuer’s   capitalization.
    
	
 
    	
 
    	
 
    
	
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:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
In respect of any Component:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Expiration   Time:
    	
 
    	
Valuation   Time
    
	
 
    	
 
    	
 
    
	
Expiration   Date:
    	
 
    	
As   provided in Annex A to this Confirmation (or, if such date is not a   Scheduled Trading Day, the next following Scheduled Trading Day that is not   already an Expiration Date for another Component); provided that if that date is a Disrupted Day, the   Expiration Date for such Component shall be the first succeeding Scheduled   Trading Day that is not a Disrupted Day and is not or is not deemed to be an   Expiration Date in respect of any other Component of the Transaction   hereunder; and provided further   that if the Expiration Date has not occurred pursuant to the preceding   proviso as of the Final Disruption Date, Dealer may elect in its discretion   that the Final Disruption Date shall be the Expiration Date (irrespective of   whether such date is an Expiration Date in respect of any other Component for   the Transaction) and, notwithstanding anything to the contrary in this   Confirmation or the Definitions, the Relevant Price for such Expiration Date   shall be the prevailing market value per Share determined by the
    

 

2

 

	
 
    	
 
    	
Calculation   Agent in a commercially reasonable manner. “Final Disruption Date” means May 8, 2018. Notwithstanding   the foregoing and anything to the contrary in the Equity Definitions, if a   Market Disruption Event occurs on any Expiration Date, the Calculation Agent   may determine that such Expiration Date is a Disrupted Day only in part, in   which case (i) the Calculation Agent shall make adjustments to the   Number of Warrants for the relevant Component for which such day shall be the   Expiration Date and shall designate the Scheduled Trading Day determined in   the manner described in the immediately preceding sentence as the Expiration   Date for the remaining Warrants for such Component, and (ii) the   VWAP Price for such Disrupted Day shall be determined by the Calculation   Agent based on transactions in the Shares on such Disrupted Day taking into   account the nature and duration of such Market Disruption Event on such day. Any Scheduled Trading Day on which, as of   the date hereof, the Exchange is scheduled to close prior to its normal close   of trading shall be deemed not to be a Scheduled Trading Day; if a closure of   the Exchange prior to its normal close of trading on any Scheduled Trading   Day is scheduled following the date hereof, then such Scheduled Trading Day   shall be deemed to be a Disrupted Day in full. Section 6.6 of the Equity   Definitions shall not apply to any Valuation Date occurring on an Expiration   Date.
    
	
 
    	
 
    	
 
    
	
Market   Disruption Event:
    	
 
    	
Section 6.3(a) of   the Equity Definitions is hereby amended (A) by deleting the words   “during the one hour period that ends at the relevant Valuation Time, Latest   Exercise Time, Knock-in Valuation Time or Knock-out Valuation Time, as the   case may be,” in clause (ii) thereof and (B) by replacing the words   “or (iii) an Early Closure.” therein with “(iii) an Early Closure,   or (iv) a Regulatory Disruption.”
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Section 6.3(d) of   the Equity Definitions is hereby amended by deleting the remainder of the   provision following the term “Scheduled Closing Time” in the fourth line   thereof.
    
	
 
    	
 
    	
 
    
	
Regulatory   Disruption:
    	
 
    	
Any   event that Dealer, in its discretion, determines makes it appropriate with regard   to any legal, regulatory or self-regulatory requirements or related policies   and procedures, for Dealer to refrain from or decrease any market activity in   connection with the Transaction. Dealer shall notify Issuer as soon as   reasonably practicable that a Regulatory Disruption has occurred and the   Expiration Dates affected by it.
    
	
 
    	
 
    	
 
    
	
Automatic   Exercise:
    	
 
    	
Applicable;   and means that the Number of Warrants for each Component will be deemed to be   automatically exercised at the   Expiration Time on the Expiration Date for such Component unless Dealer   notifies Seller (by telephone or in writing) prior to the Expiration Time on   the Expiration Date that it does not wish Automatic Exercise to occur, in   which case Automatic Exercise will not apply.
    
	
 
    	
 
    	
 
    
	
Issuer’s   Telephone Number and Telex and/or Facsimile Number and Contact Details for   purpose of Giving Notice:
    	
 
    	
To   be provided by Issuer.
    

 

3

 

	
Settlement   Terms:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
In respect of any Component:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Settlement   Currency:
    	
 
    	
USD
    
	
 
    	
 
    	
 
    
	
Net   Share Settlement:
    	
 
    	
On   each Settlement Date, Issuer shall deliver to Dealer a number of Shares   equal to the Number of Shares to be Delivered for such Settlement Date to the   account specified by Dealer and pay cash to Dealer in lieu of any fractional   shares valued at the Relevant Price on the Valuation Date corresponding to   such Settlement Date.
    
	
 
    	
 
    	
 
    
	
Number   of Shares to be Delivered:
    	
 
    	
In   respect of any Exercise Date, subject to the last sentence of   Section 9.5 of the Equity Definitions, the product of   (i) the number of Warrants exercised or deemed exercised on such   Exercise Date, (ii) the Warrant Entitlement and   (iii)(A) the excess, if any, of the VWAP Price on the Valuation Date   occurring on such Exercise Date over the Strike Price, divided by   (B) such VWAP Price.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The   Number of Shares to be Delivered shall be delivered by Issuer to Dealer no   later than 4:00 P.M. (local time in New York City) on the relevant   Settlement Date.
    
	
 
    	
 
    	
 
    
	
VWAP   Price:
    	
 
    	
For   any Valuation Date, the Rule 10b-18 dollar volume weighted average price   per Share for such Valuation Date based on transactions executed during such   Valuation Date, as reported on Bloomberg Page “GTAT <Equity> AQR   SEC” (or any successor thereto) or, in the event such price is not so   reported on such Valuation Date for any reason or is manifestly incorrect, as   reasonably determined by the Calculation Agent using a volume weighted   method.
    
	
 
    	
 
    	
 
    
	
Other   Applicable Provisions:
    	
 
    	
The   provisions of Sections 9.1(c), 9.8, 9.9, 9.10, 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 Seller is the Issuer of   the Shares) and 9.12 of the Equity Definitions will be applicable as if   “Physical Settlement” applied to the Transaction.
    
	
 
    	
 
    	
 
    
	
Adjustments:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
In respect of any Component:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Method   of Adjustment:
    	
 
    	
Calculation   Agent Adjustment
    
	
 
    	
 
    	
 
    
	
Extraordinary   Dividend:
    	
 
    	
Any   Dividend that has an ex-dividend date occurring on or after the Trade Date   and on or prior to the date on which Issuer satisfies all of its delivery   obligations hereunder.
    
	
 
    	
 
    	
 
    
	
Dividend:
    	
 
    	
Any   dividend or distribution on the Shares (other than any dividend or   distribution of the type described in Sections 11.2(e)(i),   11.2(e)(ii)(A) or 11.2(e)(ii)(B) of the Equity Definitions).
    
	
 
    	
 
    	
 
    
	
Extraordinary   Events:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Consequences   of Merger Events:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
(a)          Share-for-Share:
    	
 
    	
Modified   Calculation Agent Adjustment
    
	
 
    	
 
    	
 
    
	
(b)         Share-for-Other:
    	
 
    	
Cancellation   and Payment (Calculation Agent Determination)
    

 

4

 

	
(c)          Share-for-Combined:
    	
 
    	
Cancellation   and Payment (Calculation Agent Determination)
    
	
 
    	
 
    	
 
    
	
Tender   Offer:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
Consequences   of Tender Offers:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
(a)          Share-for-Share:
    	
 
    	
Modified   Calculation Agent Adjustment
    
	
 
    	
 
    	
 
    
	
(b)         Share-for-Other:
    	
 
    	
Cancellation   and Payment (Calculation Agent Determination) on that portion of the Other   Consideration that consists of cash; Modified Calculation Agent Adjustment on   the remainder of the Other Consideration.
    
	
 
    	
 
    	
 
    
	
(c)          Share-for-Combined:
    	
 
    	
Modified   Calculation Agent Adjustment
    
	
 
    	
 
    	
 
    
	
Modified   Calculation Agent Adjustment:
    	
 
    	
If,   in respect of any Merger Event to which Modified Calculation Agent Adjustment   applies, the adjustments to be made in accordance with   Section 12.2(e)(i) of the Equity Definitions would result in Issuer   being different from the issuer of the Shares, then with respect to such   Merger Event, as a condition precedent to the adjustments contemplated in   Section 12.2(e)(i) of the Equity Definitions, Dealer, the Issuer of   the Affected Shares and the entity that will be the Issuer of the New Shares   shall, prior to the Merger Date, have entered into such documentation   containing representations, warranties and agreements relating to securities   law and other issues as requested by Dealer that Dealer has determined, in   its reasonable discretion, to be reasonably necessary or appropriate to allow   Dealer to continue as a party to the Transaction, as adjusted under   Section 12.2(e)(i) of the Equity Definitions, and to preserve its   hedging or hedge unwind activities in connection with the Transaction in a   manner compliant with applicable legal, regulatory or self-regulatory   requirements, or with related policies and procedures applicable to Dealer,   and if such conditions are not met or if the Calculation Agent determines   that no adjustment that it could make under Section 12.2(e)(i) of   the Equity Definitions will produce a commercially reasonable result, then   the consequences set forth in Section 12.2(e)(ii) of the Equity   Definitions shall apply.
    
	
 
    	
 
    	
 
    
	
Consequences   of Announcement Events:
    	
 
    	
Modified   Calculation Agent Adjustment as set forth in Section 12.3(d) of the   Equity Definitions; provided that   references to “Tender Offer” shall be replaced by references to “Announcement   Event” and references to “Tender Offer Date” shall be replaced by references   to “date of such Announcement Event”. An Announcement Event shall be an   “Extraordinary Event” for purposes of the Equity Definitions, to which   Article 12 of the Equity Definitions is applicable.
    
	
 
    	
 
    	
 
    
	
Announcement   Event:
    	
 
    	
(i) The   public announcement of any Merger Event or Tender Offer or the intention to   enter into a Merger Event or Tender Offer, (ii) the public announcement   by Issuer of an intention to solicit or enter into, or to explore strategic   alternatives or other similar undertaking that may include, a Merger Event or   Tender Offer or (iii) any subsequent public announcement of a change to   a transaction or intention that is the subject of an announcement of the type   described in clause (i) or (ii) of this sentence (in each case,   whether such announcement is made by Issuer or a third party).
    

 

5

 

	
Announcement   Date:
    	
 
    	
The   definition of “Announcement Date” in Section 12.1 of the Equity   Definitions is hereby amended by (i) replacing the words “a firm” with   the word “any” in the second and fourth lines thereof, (ii) replacing   the word “leads to the” with the words “, if completed, would lead to a” in   the third and the fifth lines thereof, (iii) replacing the words “voting   shares” with the word “Shares” in the fifth line thereof, and (iv) inserting   the words “by any entity” after the word “announcement” in the second and the   fourth lines thereof.
    
	
 
    	
 
    	
 
    
	
New   Shares:
    	
 
    	
In   the definition of New Shares in Section 12.1(i) of the Equity   Definitions, (a) the text in clause (i) thereof shall be deleted in   its entirety (including the word “and” following such clause (i)) and   replaced with “publicly quoted, traded or listed on any of the New York Stock   Exchange, The NASDAQ Global Select Market or The NASDAQ Global Market (or   their respective successors),” and (b) the phrase “and (iii) issued   by a corporation organized under the laws of the United States, any State   thereof or the District of Columbia” shall be inserted immediately prior to   the period.
    
	
 
    	
 
    	
 
    
	
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
    

 

6

 

	
 
    	
 
    	
(ii) Section 12.9(b)(iii) of   the Equity Definitions is hereby amended by inserting in the third line   thereof, after the words “to terminate the Transaction”, the words “or a   portion of the Transaction affected by such Hedging Disruption”.
    
	
 
    	
 
    	
 
    
	
(e)          Increased Cost of Hedging:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
(f)            Loss of Stock Borrow:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
Maximum   Stock Loan Rate:
    	
 
    	
As   provided in Annex A to this Confirmation.
    
	
 
    	
 
    	
 
    
	
(g)         Increased Cost of Stock Borrow:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
Initial   Stock Loan Rate:
    	
 
    	
As   provided in Annex A to this Confirmation.
    
	
 
    	
 
    	
 
    
	
Hedging   Party:
    	
 
    	
Dealer   for all applicable Potential Adjustment Events and Extraordinary Events
    
	
 
    	
 
    	
 
    
	
Determining   Party:
    	
 
    	
Dealer   for all applicable Extraordinary Events
    
	
 
    	
 
    	
 
    
	
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.
    
	
 
    	
 
    	
 
    
	
Issuer   Payment Instructions:
    	
 
    	
To be provided by Issuer.
    
	
 
    	
 
    	
 
    
	
5.               Offices:
    	
 
    	
 
    
	
 
    
	
The Office of Dealer for the Transaction is: 1585 Broadway, 4th Floor, New York, New York 10036
    
	
 
    
	
The   Office of Issuer for the Transaction is: Not applicable
    
	
 
    	
 
    	
 
    
	
6.                                       Notices:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
(a)                                  Address for   notices or communications to Issuer 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
    
	
 
    	
 
    
	
(b)                                 Address for   notices or communications to Dealer for purposes of this Confirmation:
    
	
 
    	
 
    
	
To: 
    	
Morgan Stanley & Co. International plc
    
	
 
    	
c/o Morgan Stanley Bank, N.A.
    
	
 
    	
c/o Morgan Stanley
    
	
 
    	
750 Seventh Avenue, 29th Floor
    
	
 
    	
New York, NY 10019
    
	
Attn:
    	
Robert Poselle
    
	
Telephone:
    	
212-276-2427
    
	
Facsimile:
    	
212-507-0724
    
	
 
    	
 
    
	
with a copy to:
    	
Morgan Stanley & Co. International plc
    
	
 
    	
c/o Morgan Stanley Bank, N.A.
    
	
 
    	
c/o Morgan Stanley
    
				

 

7

 

	
 
    	
750 Seventh Avenue, 29th Floor 
    
	
 
    	
New York, NY 10019
    
	
Attn:
    	
Anthony Cicia
    
	
Telephone:
    	
212-276-2427
    
	
Facsimile:
    	
212-507-0724
    

 

7.               Representations, Warranties and Agreements:

 

(a)                                  In addition to the representations and warranties in the Agreement and those contained elsewhere herein, Issuer 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 Issuer gives Dealer a Notice of Cash Payment Termination under (and as defined in) Section 8(a) below, (A) none of Issuer and its officers and directors is aware of any material nonpublic information regarding Issuer or the Shares and (B) all reports and other documents filed by Issuer 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.

 

(ii)                                  Without limiting the generality of Section 13.1 of the Equity Definitions, Issuer 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.

 

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

 

(iv)                              Issuer 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.

 

(v)                                 Issuer 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.

 

(vi)                              On the Trade Date, (A) the assets of Issuer at their fair valuation exceed the liabilities of Issuer, including contingent liabilities, (B) the capital of Issuer is adequate to conduct the business of Issuer and (C) Issuer has the ability to pay its debts and obligations as such debts mature and does not intend to, or does not believe that it will, incur debt beyond its ability to pay as such debts mature.

 

(vii)                           Issuer shall not take any action to decrease the number of Available Shares below the Capped Number (each as defined below).

 

(viii)                        The representations and warranties of Issuer set forth in Section 3 of the Agreement and Section 3 of the Underwriting Agreement (the “Underwriting Agreement”) dated September 24, 2012 among Issuer, 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.

 

(ix)                                Issuer 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.

 

(x)                                   During the period starting on the first Expiration Date and ending on the last Expiration Date (the “Settlement Period”), the Shares or securities that are convertible into, or exchangeable or exercisable for,

 

8

 

Shares will not be subject to a “restricted period,” as such term is defined in Regulation M under the Exchange Act (“Regulation M”).

 

(xi)                                On each day during the Settlement Period, neither Issuer nor any “affiliate” or “affiliated purchaser” (each as defined in Rule 10b-18 under the Exchange Act (“Rule 10b-18”)) 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.

 

(xii)                             On the Trade Date and at all times until termination or earlier expiration of the Transaction, (A) a number of Shares equal to the Capped Number have been reserved for issuance by all required corporate action of Issuer, (B) the Shares issuable upon exercise of the Warrants (the “Warrant Shares”) have been duly authorized and, when delivered against payment therefor (which may include Net Share Settlement in lieu of cash) and otherwise as contemplated by the terms of the Warrant following the exercise of the Warrant in accordance with the terms and conditions of the Warrant, will be validly issued, fully-paid and non-assessable and (C) the issuance of the Warrant Shares will not be subject to any preemptive or similar rights.

 

(xiii)                          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.

 

(xiv)                         Issuer (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 Issuer 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 Issuer 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, Dealer represents and warrants to Issuer 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 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)                                 Issuer 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 Title 11 of the United States Code (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)                                  Issuer 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 and Section 7(a)(xii) of this Confirmation (replacing, solely for these purposes, the words “On the Trade Date and at all times until termination or earlier expiration of the Transaction” with the words “On the Effective Date”).

 

9

 

(f)                                    Issuer and Dealer agree and acknowledge that Shares delivered by the Issuer to Dealer pursuant to the terms of the Transaction may not have been registered under the Securities Act.

 

8.  Other Provisions:

 

(a)                                  Alternative Calculations and Payment on Early Termination and on Certain Extraordinary Events.  If Issuer shall owe Dealer any amount pursuant to Sections 12.2, 12.3, 12.6, 12.7 or 12.9 of the Equity Definitions or pursuant to Section 6(d)(ii) of the Agreement (a “Payment Obligation”), Issuer shall satisfy any such Payment Obligation by the Share Termination Alternative (as defined below), unless (a) Issuer 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 Merger Date, Tender Offer 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 Sections 12.2, 12.3, 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 Merger Date, the Tender Offer 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 Issuer shall deliver to Dealer the Share Termination Delivery   Property on the date on which the Payment Obligation would otherwise be due   pursuant to Section 12.7 or 12.9 of the Equity Definitions or   Section 6(d)(ii) of the Agreement, as applicable (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 Issuer 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, Merger Event or Tender Offer, 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, Merger Event or Tender Offer, as applicable. If   such Insolvency, Nationalization, Merger Event or Tender Offer 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, 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 Seller is the issuer of the Shares or any portion of   the Share Termination Delivery Units) and 9.12 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”.
    

 

10

 

(b)           Private Placement Procedures.  (i)  If, in the reasonable judgment of Dealer, for any reason, any Shares or any securities of Issuer or its affiliates comprising any Share Termination Delivery Units deliverable to Dealer hereunder (any such Shares or securities, “Delivered Securities”) would not be immediately freely transferable by Dealer under Rule 144 under the Securities Act, then the provisions set forth in this Section 8(b) shall apply.  In such event, Issuer shall deliver additional Delivered Securities so that the value of such Delivered Securities, as determined by the Calculation Agent to reflect an appropriate liquidity discount, equals the value of the number of Delivered Securities that would otherwise be deliverable if such Delivered Securities were freely tradeable (without prospectus delivery) upon receipt by Dealer (such value, the “Freely Tradeable Value”).  (For the avoidance of doubt, as used in this paragraph (b) only, the term “Issuer” shall mean the issuer of the relevant securities, as the context shall require.)

 

(ii) (A)    Dealer (or an Affiliate of Dealer designated by Dealer) and any potential institutional purchaser of any such Delivered Securities from Dealer or such Affiliate identified by Dealer shall be afforded a commercially reasonable opportunity to conduct a due diligence investigation in compliance with applicable law with respect to Issuer customary in scope for private placements of equity securities (including, without limitation, the right to have made available to them for inspection all financial and other records, pertinent corporate documents and other information reasonably requested by them);

 

(B)           Dealer (or an Affiliate of Dealer designated by Dealer) and Issuer shall enter into an agreement (a “Private Placement Agreement”) on commercially reasonable terms in connection with the private placement of such Delivered Securities by Issuer to Dealer or such Affiliate and the private resale of such shares by Dealer or such Affiliate, substantially similar to private placement purchase agreements customary for private placements of equity securities, in form and substance commercially reasonably satisfactory to Dealer and Issuer, which Private Placement Agreement shall include, without limitation, provisions substantially similar to those contained in such private placement purchase agreements relating to the indemnification of, and contribution in connection with the liability of, Dealer and its Affiliates and Issuer, shall provide for the payment by Issuer of all expenses in connection with such resale, including all fees and expenses of counsel for Dealer, shall contain representations, warranties and agreements of Issuer reasonably necessary or advisable to establish and maintain the availability of an exemption from the registration requirements of the Securities Act for such resales, and shall use best efforts to provide for the delivery of accountants’ “comfort letters” to Dealer or such Affiliate with respect to the financial statements and certain financial information contained in or incorporated by reference into the offering memorandum prepared for the resale of such Shares; and

 

(C)           Issuer agrees that any Delivered Securities so delivered to Dealer, (i) may be transferred by and among Dealer and its Affiliates, and Issuer shall effect such transfer without any further action by Dealer and (ii) after the minimum “holding period” within the meaning of Rule 144(d) under the Securities Act has elapsed with respect to such Delivered Securities, Issuer shall promptly remove, or cause the transfer agent for such Shares or securities to remove, any legends referring to any such restrictions or requirements from such Delivered Securities upon delivery by Dealer (or such Affiliate of Dealer) to Issuer or such transfer agent of seller’s and broker’s representation letters customarily delivered by Dealer in connection with resales of restricted securities pursuant to Rule 144 under the Securities Act, without any further requirement for the delivery of any certificate, consent, agreement, opinion of counsel, notice or any other document, any transfer tax stamps or payment of any other amount or any other action by Dealer (or such affiliate of Dealer).

 

(D)          Issuer shall not take, or cause to be taken, any action that would make unavailable either the exemption pursuant to Section 4(2) of the Securities Act for the sale by Issuer to Dealer (or any affiliate designated by Dealer) of the Shares or Share Termination Delivery Units, as the case may be, or the exemption pursuant to Section 4(1) or Section 4(3) of the Securities Act for resales of the Shares or Share Termination Delivery Units, as the case may be, by Dealer (or any such affiliate of Dealer).

 

(c)           Make-whole. Dealer or its affiliate may sell such Shares or Share Termination Delivery Units delivered in satisfaction of a Payment Obligation, as the case may be, during a period (the “Resale Period”) commencing on the Exchange Business Day following delivery of such Shares or Share Termination Delivery Units, as the case may be, and ending on the Exchange Business Day on which Dealer completes the sale of all such Shares or Share Termination Delivery Units, as the case may be, or a sufficient number of Shares or Share Termination Delivery Units, as the case may be, so that the realized net proceeds of such sales exceed the Freely Tradeable Value (such amount of the Freely Tradeable Value, the “Required Proceeds”).  If any of such delivered Shares or Share Termination Delivery Units remain after such realized net proceeds exceed the Required Proceeds, Dealer shall return such remaining Shares or

 

11

 

Share Termination Delivery Units to Issuer.  If the Required Proceeds exceed the realized net proceeds from such resale, Issuer shall transfer to Dealer by the open of the regular trading session on the Exchange on the Exchange Trading Day immediately following the last day of the Resale Period the amount of such excess (the “Additional Amount”) in cash or in a number of additional Shares or Share Termination Delivery Units, as the case may be, (“Make-whole Shares”) in an amount that, based on the Relevant Price on the last day of the Resale Period (as if such day was the “Valuation Date” for purposes of computing such Relevant Price), has a dollar value equal to the Additional Amount.  The Resale Period shall continue to enable the sale of the Make-whole Shares in the manner contemplated by this Section 8(c).  This provision shall be applied successively until the Additional Amount is equal to zero, subject to Section 8(e).  For the avoidance of doubt, the Dealer will use commercially reasonable efforts to sell such Shares or Share Termination Delivery Units, as the case may be, for a price equal to their fair market value.

 

(d)           Beneficial Ownership. Notwithstanding anything to the contrary in the Agreement or this Confirmation, in no event shall Dealer be entitled to receive, or shall be deemed to receive, any Shares in connection with the Transaction if, immediately upon giving effect to such receipt of such Shares, (i) Dealer’s Beneficial Ownership would be equal to or greater than 7.5% of the outstanding Shares, (ii) Dealer, or any “affiliate” or “associate” of Dealer, would be an “interested stockholder” of Issuer, as all such terms are defined in 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 Issuer 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 Issuer or any contract or agreement to which Issuer is a party, in each case minus (y) 1% of the number of Shares outstanding on the date of determination (each of clause (i), (ii) and (iii) above, an “Ownership Limitation”). If any delivery owed to Dealer hereunder is not made, in whole or in part, as a result of an Ownership Limitation, Dealer’s right to receive such delivery shall not be extinguished and Issuer shall make such delivery as promptly as practicable after, but in no event later than one Exchange Business Day after, Dealer gives notice to Issuer that such delivery would not result in any of such Ownership Limitations being breached.  “Dealer’s Beneficial Ownership” means the “beneficial ownership” (within the meaning of Section 13 of the Exchange Act and the rules promulgated thereunder (collectively, “Section 13”)) of Shares, without duplication, by Dealer, together with any of its affiliates or other person subject to aggregation with Dealer under Section 13 for purposes of “beneficial ownership”, or by 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”) (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).  Notwithstanding anything in the Agreement or this Confirmation to the contrary, Dealer (or the affiliate designated by Dealer pursuant to Section 8(l) below) shall not become the record or beneficial owner, or otherwise have any rights as a holder, of any Shares that Dealer (or such affiliate) is not entitled to receive at any time pursuant to this Section 8(d), until such time as such Shares are delivered pursuant to this Section 8(d).

 

(e)           Limitations on Settlement by Issuer.  Notwithstanding anything herein or in the Agreement to the contrary, in no event shall Issuer be required to deliver Shares in connection with the Transaction in excess of the Capped Number of Shares (as provided in Annex A to this Confirmation), subject to adjustment from time to time in accordance with the provisions of this Confirmation or the Definitions resulting from actions of Issuer or events within Issuer’s control (the “Capped Number”).  Issuer represents and warrants to Dealer (which representation and warranty shall be deemed to be repeated on each day that the Transaction is outstanding) that the Capped Number is equal to or less than the number of authorized but unissued Shares of the Issuer that are not reserved for future issuance in connection with transactions in the Shares (other than the Transaction) on the date of the determination of the Capped Number (such Shares, the “Available Shares”).  In the event Issuer shall not have delivered the full number of Shares otherwise deliverable as a result of this Section 8(e) (the resulting deficit, the “Deficit Shares”), Issuer shall be continually obligated to deliver, from time to time until the full number of Deficit Shares have been delivered pursuant to this paragraph, Shares when, and to the extent, that (i) Shares are repurchased, acquired or otherwise received by Issuer or any of its subsidiaries after the Trade Date (whether or not in exchange for cash, fair value or any other consideration), (ii) authorized and unissued Shares reserved for issuance in respect of other transactions prior to such date which prior to

 

12

 

the relevant date become no longer so reserved or (iii) Issuer additionally authorizes any unissued Shares that are not reserved for other transactions.  Issuer shall immediately notify Dealer of the occurrence of any of the foregoing events (including the number of Shares subject to clause (i), (ii) or (iii) and the corresponding number of Shares to be delivered) and promptly deliver such Shares thereafter.

 

(f)            Right to Extend.  Dealer may postpone any Exercise Date or Settlement Date or any other date of valuation or delivery with respect to some or all of the relevant Warrants (in which event the Calculation Agent shall make appropriate adjustments to the Number of Shares to be Delivered with respect to one or more Components), 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 Issuer or an affiliated purchaser of Issuer, be in compliance with applicable legal, regulatory or self-regulatory requirements, or with related policies and procedures applicable to Dealer.

 

(g)           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 Issuer’s bankruptcy.  For the avoidance of doubt, the parties agree that the preceding sentence shall not apply at any time other than during Issuer’s bankruptcy to any claim arising as a result of a breach by Issuer 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 Issuer herein under or pursuant to any other agreement.

 

(h)           Amendments to Equity Definitions.  The following amendments shall be made to the Equity Definitions:

 

(i)            Section 11.2(a) of the Equity Definitions is hereby amended by deleting the words “a diluting or concentrative” and replacing them with the words “an”; and adding the phrase “or Warrants” at the end of the sentence.

 

(ii)           The first sentence of Section 11.2(c) of the Equity Definitions, prior to clause (A) thereof, is hereby amended to read as follows: ‘(c) If “Calculation Agent Adjustment” is specified as the Method of Adjustment in the related Confirmation of a Share Option Transaction, then following the announcement or occurrence of any Potential Adjustment Event, the Calculation Agent will determine whether such Potential Adjustment Event has an effect on the theoretical value of the relevant Shares or options on the Shares and, if so, will (i) make appropriate adjustment(s), if any, to any one or more of:’ and, the portion of such sentence immediately preceding clause (ii) thereof is hereby amended by deleting the words “diluting or concentrative” and the words “(provided that no adjustments will be made to account solely for changes in volatility, expected dividends, stock loan rate or liquidity relative to the relevant Shares)” and replacing such latter phrase with the words “(and, for the avoidance of doubt, adjustments may be made to account solely for changes in volatility, expected dividends, stock loan rate or liquidity relative to the relevant Shares)”;

 

(iii)          Section 11.2(e)(vii) of the Equity Definitions is hereby amended by deleting the words “diluting or concentrative” and replacing them with “a material” and adding the phrase “or Warrants” at the end of the sentence;

 

(iv)          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.”;

 

(v)           Section 12.9(b)(iv) of the Equity Definitions is hereby amended by (A) deleting (1) subsection (A) in its entirety, (2) the phrase “or (B)” following subsection (A) and (3) the phrase “in each case” in subsection (B); and (B) deleting the phrase “neither the Non-Hedging Party nor the Lending Party lends Shares in the amount of the Hedging Shares or” in the penultimate sentence; and

 

(vi)          Section 12.9(b)(v) of the Equity Definitions is hereby amended by (A) adding the word “or” immediately before subsection “(B)” and deleting the comma at the end of subsection (A); and (B)(1) deleting subsection (C) in its entirety, (2) deleting the word “or” immediately preceding subsection (C) and (3) replacing

 

13

 

in the penultimate sentence the words “either party” with “the Hedging Party” and (4) deleting clause (X) in the final sentence.

 

(i)            Transfer and Assignment.  Dealer may transfer or assign its rights and obligations hereunder and under the Agreement, in whole or in part, at any time to any person or entity whatsoever without the consent of Issuer; provided, however, that the transferee or assignee shall not be entitled to receive any greater payment of additional amounts under Section 2(d)(i)(4) of the Agreement than Dealer would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Tax Law that occurs after the date of the transfer or assignment.  At any time at which any Ownership Limitation or a Hedging Disruption exists, if Dealer, in its discretion, is unable to effect a transfer or assignment to a third party after using its commercially reasonable efforts on pricing terms and within a time period reasonably acceptable to Dealer such that an Ownership Limitation 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 Ownership Limitation 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) Issuer 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.

 

(j)            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.

 

(k)           Disclosure.  Effective from the date of commencement of discussions concerning the Transaction, Issuer 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 Issuer relating to such tax treatment and tax structure.

 

(l)            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 Issuer, 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 Issuer to the extent of any such performance.

 

(m)          Additional Termination Events.  The occurrence of any of the following shall constitute an Additional Termination Event with respect to which the Transaction shall be the sole Affected Transaction and Issuer shall be the sole Affected Party; provided that with respect to any Additional Termination Event, Dealer may choose to treat part of the Transaction as the sole Affected Transaction, and, upon the termination of the Affected Transaction, a Transaction with terms identical to those set forth herein except with a Number of Warrants equal to the unaffected number of Warrants shall be treated for all purposes as the Transaction, which shall remain in full force and effect:

 

(i)             Dealer reasonably determines that it is advisable to terminate a portion of the Transaction so that Dealer’s related hedging activities will comply with applicable securities laws, rules or regulations or related policies and procedures of Dealer (whether or not such requirements, policies or procedures are imposed by law or have been voluntarily adopted by Dealer, so long as such requirements, policies and procedures are generally applicable to transactions similar to the Transaction);

 

(ii)            a “person” or “group” within the meaning of Section 13(d) of the Exchange Act, other than Issuer, its subsidiaries and the employee benefit plans of Issuer or its subsidiaries, files a Schedule TO or any schedule, form or report under the Exchange Act disclosing that such person or group has become the direct or indirect “beneficial owner,” as defined in Rule 13d-3 under the Exchange Act, of the common equity of Issuer representing more than 50% of the voting power the common equity of Issuer;

 

(iii)           the consummation of (A) any recapitalization, reclassification or change of the Shares (other than changes resulting from a subdivision or combination) as a result of which the Shares would be converted

 

14

 

into, or exchanged for, stock, other securities, other property or assets; (B) any share exchange, consolidation or merger of Issuer pursuant to which the Shares will be converted into cash, securities or other property; or (C) any sale, lease or other transfer in one transaction or a series of transactions of all or substantially all of the consolidated assets of Issuer and its subsidiaries, taken as a whole, to any person other than one of Issuer’s subsidiaries;

 

(iv)          the stockholders of Issuer approve any plan or proposal for the liquidation or dissolution of Issuer; or

 

(v)           the Shares cease to be listed or quoted on any of The NASDAQ Global Select Market, The NASDAQ Global Market or the New York Stock Exchange (or any of their respective successors).

 

Notwithstanding the foregoing, any transaction set forth in clauses (ii), (iii) or (v) above will not constitute an Additional Termination Event if at least 90% of the consideration received or to be received by the holders of the Shares, excluding cash payments for fractional shares and cash payments made pursuant to dissenters’ appraisal rights, in connection with such transaction or transactions consists of shares of common stock that are listed or quoted on any of the New York Stock Exchange, The NASDAQ Global Select Market or The NASDAQ Global Market (or any of their respective successors) or will be so listed or quoted when issued or exchanged in connection with such transaction or transactions and as a result of such transaction or transactions the Shares will consist of such consideration, excluding cash payments for fractional Shares.

 

(n)           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.

 

(o)           Effectiveness.  If, prior to the Effective Date, Dealer reasonably determines, based on the advice of counsel, that it is advisable to cancel the Transaction because of concerns that Dealer’s related hedging activities could be viewed as not complying with applicable securities laws, rules or regulations, the Transaction shall be cancelled and shall not become effective, and neither party shall have any obligation to the other party in respect of the Transaction.

 

(p)           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, Loss of Stock Borrow, Increased Cost of Stock Borrow, an Excess Ownership Position or Illegality (as defined in the Agreement)).

 

(q)           Waiver of Trial by Jury.  EACH OF ISSUER 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.

 

(r)            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.

 

15

 

(s)           Role of Agent.  (i) Agent is acting as agent for Dealer but does not guarantee the performance of Dealer or Issuer; (ii) Dealer is not a member of the Securities Investor Protection Corporation; (iii) Agent, Dealer and Issuer each hereby acknowledges that any transactions by Dealer or Agent in the Shares will be undertaken by Dealer as principal for its own account; (iv) all of the actions to be taken by Dealer and Agent in connection with the Transaction shall be taken by Dealer or Agent independently and without any advance or subsequent consultation with Issuer; and (v) Agent is hereby authorized to act as agent for Issuer only to the extent required to satisfy the requirements of Rule 15a-6 under the Exchange Act in respect of the Transaction described hereby.

 

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

 

(u)           For the avoidance of doubt, any performance by Issuer of its obligations (including notice obligations) through or by means of Agent shall constitute good performance of Issuer’s obligations hereunder to Dealer when Issuer 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 Issuer through or by means of Agent shall only constitute good performance of Dealer’s obligations hereunder to the extent Agent actually performs such obligations.

 

16

 

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

 

	
 
    	
Yours   faithfully,
    
	
 
    	
 
    
	
 
    	
MORGAN STANLEY & CO. INTERNATIONAL PLC
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Joseba Dicaza
    
	
 
    	
 
    	
Name:   Joseba Dicaza
    
	
 
    	
 
    	
Title:   Executive Director
    
	
 
    	
 
    	
 
    
	
 
    	
MORGAN STANLEY BANK, N.A., as agent
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Serkan Savasoglu
    
	
 
    	
 
    	
Name:   Serkan Savasoglu
    
	
 
    	
 
    	
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 Additional Issuer Warrant Transaction

 

 

Annex A

 

For each Component of the Transaction, the Number of Warrants and Expiration Date is set forth below.

 

	
Component Number
    	
 
    	
Number of Warrants
    	
 
    	
Expiration Date
    
	
1
    	
 
    	
4,865
    	
 
    	
January 2, 2018
    
	
2
    	
 
    	
4,865
    	
 
    	
January 3, 2018
    
	
3
    	
 
    	
4,865
    	
 
    	
January 4, 2018
    
	
4
    	
 
    	
4,865
    	
 
    	
January 5, 2018
    
	
5
    	
 
    	
4,865
    	
 
    	
January 8, 2018
    
	
6
    	
 
    	
4,865
    	
 
    	
January 9, 2018
    
	
7
    	
 
    	
4,865
    	
 
    	
January 10, 2018
    
	
8
    	
 
    	
4,865
    	
 
    	
January 11, 2018
    
	
9
    	
 
    	
4,865
    	
 
    	
January 12, 2018
    
	
10
    	
 
    	
4,865
    	
 
    	
January 16, 2018
    
	
11
    	
 
    	
4,865
    	
 
    	
January 17, 2018
    
	
12
    	
 
    	
4,865
    	
 
    	
January 18, 2018
    
	
13
    	
 
    	
4,865
    	
 
    	
January 19, 2018
    
	
14
    	
 
    	
4,865
    	
 
    	
January 22, 2018
    
	
15
    	
 
    	
4,865
    	
 
    	
January 23, 2018
    
	
16
    	
 
    	
4,865
    	
 
    	
January 24, 2018
    
	
17
    	
 
    	
4,865
    	
 
    	
January 25, 2018
    
	
18
    	
 
    	
4,865
    	
 
    	
January 26, 2018
    
	
19
    	
 
    	
4,865
    	
 
    	
January 29, 2018
    
	
20
    	
 
    	
4,865
    	
 
    	
January 30, 2018
    
	
21
    	
 
    	
4,865
    	
 
    	
January 31, 2018
    
	
22
    	
 
    	
4,865
    	
 
    	
February 1, 2018
    
	
23
    	
 
    	
4,865
    	
 
    	
February 2, 2018
    
	
24
    	
 
    	
4,865
    	
 
    	
February 5, 2018
    
	
25
    	
 
    	
4,865
    	
 
    	
February 6, 2018
    
	
26
    	
 
    	
4,865
    	
 
    	
February 7, 2018
    
	
27
    	
 
    	
4,865
    	
 
    	
February 8, 2018
    
	
28
    	
 
    	
4,865
    	
 
    	
February 9, 2018
    
	
29
    	
 
    	
4,865
    	
 
    	
February 12, 2018
    
	
30
    	
 
    	
4,865
    	
 
    	
February 13, 2018
    
	
31
    	
 
    	
4,865
    	
 
    	
February 14, 2018
    
	
32
    	
 
    	
4,865
    	
 
    	
February 15, 2018
    
	
33
    	
 
    	
4,865
    	
 
    	
February 16, 2018
    
	
34
    	
 
    	
4,865
    	
 
    	
February 20, 2018
    
	
35
    	
 
    	
4,865
    	
 
    	
February 21, 2018
    
	
36
    	
 
    	
4,865
    	
 
    	
February 22, 2018
    
	
37
    	
 
    	
4,865
    	
 
    	
February 23, 2018
    
	
38
    	
 
    	
4,865
    	
 
    	
February 26, 2018
    
	
39
    	
 
    	
4,865
    	
 
    	
February 27, 2018
    
	
40
    	
 
    	
4,865
    	
 
    	
February 28, 2018
    
	
41
    	
 
    	
4,865
    	
 
    	
March 1, 2018
    
	
42
    	
 
    	
4,865
    	
 
    	
March 2, 2018
    
	
43
    	
 
    	
4,865
    	
 
    	
March 5, 2018
    
	
44
    	
 
    	
4,865
    	
 
    	
March 6, 2018
    
	
45
    	
 
    	
4,865
    	
 
    	
March 7, 2018
    
	
46
    	
 
    	
4,865
    	
 
    	
March 8, 2018
    
	
47
    	
 
    	
4,865
    	
 
    	
March 9, 2018
    
	
48
    	
 
    	
4,865
    	
 
    	
March 12, 2018
    
	
49
    	
 
    	
4,865
    	
 
    	
March 13, 2018
    
	
50
    	
 
    	
4,865
    	
 
    	
March 14, 2018
    
	
51
    	
 
    	
4,865
    	
 
    	
March 15, 2018
    

 

Annex A-1

 

	
52
    	
 
    	
4,865
    	
 
    	
March 16, 2018
    
	
53
    	
 
    	
4,865
    	
 
    	
March 19, 2018
    
	
54
    	
 
    	
4,865
    	
 
    	
March 20, 2018
    
	
55
    	
 
    	
4,865
    	
 
    	
March 21, 2018
    
	
56
    	
 
    	
4,865
    	
 
    	
March 22, 2018
    
	
57
    	
 
    	
4,865
    	
 
    	
March 23, 2018
    
	
58
    	
 
    	
4,865
    	
 
    	
March 26, 2018
    
	
59
    	
 
    	
4,865
    	
 
    	
March 27, 2018
    
	
60
    	
 
    	
4,865
    	
 
    	
March 28, 2018
    
	
61
    	
 
    	
4,865
    	
 
    	
March 29, 2018
    
	
62
    	
 
    	
4,865
    	
 
    	
April 2, 2018
    
	
63
    	
 
    	
4,865
    	
 
    	
April 3, 2018
    
	
64
    	
 
    	
4,865
    	
 
    	
April 4, 2018
    
	
65
    	
 
    	
4,865
    	
 
    	
April 5, 2018
    
	
66
    	
 
    	
4,865
    	
 
    	
April 6, 2018
    
	
67
    	
 
    	
4,865
    	
 
    	
April 9, 2018
    
	
68
    	
 
    	
4,865
    	
 
    	
April 10, 2018
    
	
69
    	
 
    	
4,865
    	
 
    	
April 11, 2018
    
	
70
    	
 
    	
4,865
    	
 
    	
April 12, 2018
    
	
71
    	
 
    	
4,865
    	
 
    	
April 13, 2018
    
	
72
    	
 
    	
4,865
    	
 
    	
April 16, 2018
    
	
73
    	
 
    	
4,865
    	
 
    	
April 17, 2018
    
	
74
    	
 
    	
4,865
    	
 
    	
April 18, 2018
    
	
75
    	
 
    	
4,865
    	
 
    	
April 19, 2018
    
	
76
    	
 
    	
4,865
    	
 
    	
April 20, 2018
    
	
77
    	
 
    	
4,865
    	
 
    	
April 23, 2018
    
	
78
    	
 
    	
4,865
    	
 
    	
April 24, 2018
    
	
79
    	
 
    	
4,865
    	
 
    	
April 25, 2018
    
	
80
    	
 
    	
4,821
    	
 
    	
April 26, 2018
    

 

	
Strike   Price:
    	
USD9.9328
    
	
 
    	
 
    
	
Premium:
    	
USD567,581
    
	
 
    	
 
    
	
Maximum   Stock Loan Rate:
    	
200   basis points
    
	
 
    	
 
    
	
Initial   Stock Loan Rate:
    	
25   basis points
    
	
 
    	
 
    
	
Capped   Number of Shares:
    	
778,312
    

 

2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00208-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00208-of-00352.parquet"}]]