Document:

Exhibit 10.8

 

Exhibit 10.8

EXECUTION COPY

Opening Transaction

	 	 	 
	To:

	 	Horizon Lines, Inc.
	 

	 	4064 Colony Road, Suite 200
	 

	 	Charlotte, North Carolina 28211
	 
	 	 
	From:

	 	Wachovia Capital Markets, LLC, solely as agent of Wachovia Bank, National
Association
	 
	 	 
	Re:

	 	Issuer Warrant Transaction
	 
	 	 
	Date:

	 	August 1, 2007

Dear Sir(s):

     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 Wachovia Capital Markets, LLC (“Agent”), solely as agent of Wachovia Bank,
National Association (“Dealer”) and Horizon Lines, 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
2000 ISDA Definitions (including the Annex thereto) (the “2000 Definitions”) and the definitions
and provisions of the 2002 ISDA Equity Derivatives Definitions (the “Equity Definitions”, and
together with the 2000 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 2000 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.

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

     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 1992 ISDA Master Agreement
(Multicurrency—Cross Border) as if Dealer and Issuer had executed an agreement in such form on the
date hereof (but without any Schedule except for (i) the election of Loss and Second Method, New
York law (without regard to the conflicts of law principles) as the governing law and US Dollars
(“USD”) as the Termination Currency, (ii) the election that the “Cross Default” provisions of
Section 5(a)(vi) shall apply to Issuer with a “Threshold Amount” of USD 15 million) and (iii) the
amendment of Section 5(a)(vi) to delete the words “or becoming capable at such time of being
declared,”.

     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:
	 	August 1, 2007
	 
	 	 
	Effective Date:
	 	August 8, 2007, or such other date as agreed between the parties, subject to Section 8(k) 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: “HRZ”).
	 
	 	 
	Number of Warrants:
	 	For each Component, as provided in Annex A to this Confirmation.
	 
	 	 
	Warrant Entitlement:
	 	One Share per Warrant
	 
	 	 
	Strike Price:
	 	USD51.4080
	 
	 	 
	Premium:
	 	USD3,261,330 (Premium per Warrant USD1.345404862)
	 
	 	 
	Premium Payment Date:
	 	The Effective Date
	 
	 	 
	Exchange:
	 	New York Stock Exchange
	 
	 	 
	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 

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	 	if the Expiration Date has not occurred pursuant to the preceding proviso as of the
Final Disruption Date, 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 ). “Final Disruption Date” means April 19, 2013.  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 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.  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 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.

	 
	 	 
	Automatic Exercise:
	 	Applicable; and means that the Number of Warrants for the corresponding Expiration Date will be deemed to be automatically exercised at the Expiration Time on such Expiration Date unless Dealer notifies Seller (by telephone or in writing) prior to the Expiration Time on such Expiration Date that it does not wish Automatic Exercise to occur, in which case Automatic Exercise will not apply to such Expiration Date.

	 
	 	 
	Issuer’s Telephone Number
and Telex and/or Facsimile Number
and Contact Details for purpose of
Giving Notice:
	 	Attn:  M. Mark Urbania, Senior Vice President and Chief Financial Officer
	 
	 	Telephone:  (704) 973-7049
	 
	 	Facsimile:  (704) 973-7010
	 
	 	 
	 
	 	With a copy to:
	 
	 	 
	 
	 	Attn:  Robert S. Zuckerman, Vice President and General Counsel
	 
	 	Telephone:  (704) 973-7012
	 
	 	Facsimile:  (704) 973-7010
	 
	 	 
	Settlement Terms:
	 	 
	 
	 	 
	In respect of any Component:
	 	 

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	Settlement Currency:
	 	USD
	 
	Settlement Method Election:
	 	Applicable1; provided that (a) Section 7.1 of the Equity Definitions is hereby amended by deleting the word
“Physical” in the sixth line thereof and replacing it with the words “Net Share,” (b) the Electing Party shall make the same
settlement method election with respect to all Components, and (c) the Electing Party may make a settlement method election
only if the Electing Party represents and warrants to Dealer in writing on the date it notifies Dealer of its election that,
as of such date, the representations, warranties and agreements set forth in Section 7(a)(i) are true and correct, and it is electing
the settlement method in good faith and not as part of a plan or scheme to evade compliance with the federal securities laws.

	 
	 	 
	Electing Party:
	 	Issuer
	 
	 	 
	Settlement Method Election Date:
	 	The date falling 30 calendar days prior to the Expiration Date for the first Component.
	 
	 	 
	Default Settlement Method:
	 	Net Share Settlement
	 
	 	 
	Strike Price Differential:
	 	The greater of (i) the excess of the VWAP Price over the Strike Price, and (ii) zero.
	 
	 	 
	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 cash in lieu of any fractional Shares valued at the Relevant Price on the Valuation Date corresponding to such Settlement Date.  If, in the reasonable judgment of Dealer, for any reason, the Shares deliverable upon Net Share
Settlement would not be immediately freely transferable by Dealer under Rule 144(k) under the Securities Act of 1933, as
amended (the “Securities Act”), then Dealer may elect to either (x) accept delivery of such Shares notwithstanding any restriction on transfer or (y) have the provisions set forth in Section 8(b) below apply.

	 
	 	 
	 
	 	The Number of Shares to be Delivered shall be delivered by Issuer to Dealer no later than 12:00 noon (local time in New York City) on the relevant 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 of the VWAP Price on the Valuation Date occurring on 

 

			
	1	 	Subject to continuing credit review by Dealers.

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	 	such Exercise Date over the Strike Price (or, if no such excess, zero) divided by (B) such VWAP Price.
	 
	 	 
	VWAP Price:
	 	For any Valuation Date, the
New York Volume Weighted Average Price per share of Shares for the regular trading
session (including any extensions thereof) of the Exchange on such Valuation Date (without regard to pre-open or after hours trading outside of such regular trading session), as published by Bloomberg at 4:15 P.M. New York City time (or 15 minutes following the end of any extension of the
regular trading session) on such Valuation Date, on Bloomberg page “HRZ.N <Equity> AQR” (or any
successor thereto) (or if such published volume weighted average price is unavailable or is manifestly incorrect, the market value of one Share on such Valuation Date, 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 as a result of the fact that
Seller is the Issuer of the Shares and under Maritime
Laws (as defined below) applicable to Issuer) 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; provided that in respect of an Extraordinary Dividend,  “Calculation Agent
Adjustment” shall be as described in the provision below.  For the avoidance of doubt, Calculation Agent Adjustment (including, without limitation, in respect of Extraordinary Dividends) shall continue to apply until the obligations of the parties (including any obligations of Issuer pursuant to Section 8(e) below) under the Transaction have been satisfied in
full.

	 
	 	 
	Extraordinary Dividend:
	 	Any cash dividend or distribution on the
Shares with an ex-dividend date occurring on or after the Trade Date
and on or prior to the Expiration Date (or, if any Deficit
Shares are owed pursuant to Section 8(e) below, such later
date on which Issuer’s obligations under this
Transaction have been satisfied in full) the
amount of which is greater than the Ordinary Dividend Amount for such dividend or distribution.
	 
	 	 
	Ordinary Dividend Amount:
	 	For any cash dividend or distribution on the Shares, USD0.11 if the ex-dividend date for such dividend or distribution (i) is the first ex-dividend date for a cash 

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	 	dividend or distribution on the Shares that occurs within any given calendar quarter and (ii) occurs on or prior to the originally scheduled Expiration Date, or earlier date of cancellation or early redemption; otherwise, zero.

	 
	 	 
	Extraordinary Dividend Adjustment:
	 	If at any time during the period from and including the Trade Date, to but excluding the last Expiration Date (or, if any Deficit Shares are owed pursuant to Section 8(e) below, such later date on which Issuer's obligations under this Transaction have been satisfied in full), an ex-dividend date for an Extraordinary Dividend occurs, then the Calculation Agent will make adjustments to the Strike Price, the Number of Warrants, the Warrant Entitlement and/or any other variable
 relevant to the exercise, settlement, payment or other terms of the Transaction to preserve the fair value of the Transaction to Dealer after taking into account such Extraordinary Dividend.

	 
	 	 
	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); provided that the Calculation Agent may elect Component Adjustment for all or part of the Transaction.
	 
	 	 
	Tender Offer:
	 	Applicable
	 
	 	 
	Consequences of Tender Offers:
	 	 
	 
	 	 
	(a) Share-for-Share:
	 	Modified Calculation Agent Adjustment
	 
	 	 
	(b) Share-for-Other:
	 	Modified Calculation Agent Adjustment
	 
	 	 
	(c) Share-for-Combined:
	 	Modified Calculation Agent Adjustment
	 
	 	 
	Modified Calculation
Agent Adjustment:
	 	If, in respect of any Merger Event or Tender Offer to
which Modified Calculation Agent Adjustment applies, the adjustments
to be made in accordance with Section 12.2(e)(i) or Section 12.3(d)(i),
as the case may be, of the Equity Definitions would result in Issuer
being different from the issuer of the Shares, then with respect to
such Merger Event or Tender Offer, as a condition precedent to the
adjustments contemplated in Section 12.2(e)(i) or Section 12.3(d)(i), as the case may be, of the Equity Definitions, Issuer and the issuer of the
Shares shall, prior to the Merger Date or Tender Offer, as the case may be, 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 

6

 

	 	 	 
	 
	 	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) or Section 12.3(d)(i), as the case may be, 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, an
d 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) or Section 12.3(d)(i), as the case may be, of the Equity Definitions will produce a commercially reasonable result, then the consequences set forth in Section 12.2(e)(ii) or Section 12.3(d)(ii), as the case may be, of the Equity Definitions shall apply.

	 
	 	 
	Reference Markets:
	 	For the avoidance of doubt, and without limiting the generality of the foregoing provisions, any adjustment effected by the Calculation Agent pursuant to Section 12.2(e) and/or Section 12.3(d) of the Equity Definitions may be determined by reference to the adjustment(s) made in respect of Merger Events or Tender Offers, as the case may be, in the convertible bond market.

	 
	 	 
	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 American Stock Exchange, The NASDAQ Global Select Market or The NASDAQ Global Market (or their respective successors); if the
Shares are immediately re-listed, re-traded or re-quoted on any such exchange or quotation system, such exchange or quotation system shall thereafter be deemed to be the Exchange.

     Additional Disruption Events:

	 	 	 	 	 
	 

	 	(a) Change in Law:
	 	Applicable
	 
	 	 	 	 
	 

	 	(b) Failure to Deliver:
	 	Applicable
	 
	 	 	 	 
	 

	 	(c) Insolvency Filing:
	 	Applicable
	 
	 	 	 	 
	 

	 	(d) Hedging Disruption:
	 	Applicable
	 
	 	 	 	 
	 

	 	(e) Increased Cost of Hedging:
	 	Applicable
	 
	 	 	 	 
	 

	 	(f) Loss of Stock Borrow:
	 	Applicable
	 
	 	 	 	 
	 

	 	     Maximum Stock Loan Rate:
	 	1% per annum
	 
	 	 	 	 
	 

	 	(g) Increased Cost of Stock Borrow:
	 	 Applicable
	 
	 	 	 	 
	 

	 	     Initial Stock Loan Rate:
	 	0.25% per annum

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	 	Hedging Party:
	 	Dealer
	 
	 	 	 	 
	 

	 	Determining Party:
	 	Dealer
	 
	 	 	 	 
	 

	 	Non-Reliance:
	 	Applicable
	 
	 	 	 	 
	 

	 	Agreements and Acknowledgments	 	 
	 

	 	Regarding Hedging Activities:
	 	Applicable
	 
	 	 	 	 
	 

	 	Additional Acknowledgments:
	 	Applicable

     3. Calculation Agent:                                
                      Dealer.

     4. Account Details:

          Dealer Payment Instructions:

ABA: 053-000-219

Wachovia Bank, National Association

Charlotte, NC

A/C: 04659360009768

Attn: Equity Derivatives

Account for delivery of Shares to Dealer: To be provided by Dealer.

          Issuer Payment Instructions: To be provided by Issuer.

     5. Offices:

          The Office of Dealer for the Transaction is:

Wachovia Bank, National Association

375 Park Avenue

New York, NY 10152

          The Office of Issuer for the Transaction is:

Horizon Lines, Inc.

4064 Colony Road, Suite 200

Charlotte, North Carolina 28211

     6. Notices: For purposes of this Confirmation:

     (a) Address for notices or communications to Issuer:

	 	 	 	 	 
	 

	 	To:
	 	Horizon Lines, Inc.
	 

	 	 	 	4064 Colony Road, Suite 200
	 

	 	 	 	Charlotte, North Carolina 28211
	 

	 	Attn:
	 	M. Mark Urbania, Senior Vice President and Chief Financial Officer
	 

	 	Telephone:
	 	(704) 973-7049
	 

	 	Facsimile:
	 	(704) 973-7010
	 
	 	 	 	 
	 	 	With a copy to:
	 
	 	 	 	 
	 

	 	Attn:
	 	Robert S. Zuckerman, Vice President and General Counsel
	 

	 	Telephone:
	 	(704) 973-7012
	 

	 	Facsimile:
	 	(704) 973-7010

8

 

     (b) Address for notices or communications to Dealer:

	 	 	 	 	 
	 

	 	To:
	 	Wachovia Bank, National Association
	 

	 	 	 	375 Park Avenue
	 

	 	 	 	New York, NY 10152
	 
	 	 	 	 
	 

	 	Attn:
	 	Head of Documentation
	 

	 	Telephone:
	 	212-214-6100
	 

	 	Facsimile:
	 	212-214-5913

     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 follows:

     (i) On the Trade Date, (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
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 with respect to
the treatment of the Transaction under FASB Statements 128, 133 (as amended), 149 or 150,
EITF Issue No. 00-19, 01-6 or 03-6 (or any successor issue statements) or under any
accounting standards including 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 and the Premium Payment 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 1 of the Purchase Agreement dated as of the Trade Date between Issuer
and Goldman, Sachs & Co., as representative of the Initial Purchasers party thereto (the
“Purchase Agreement”) are true and correct as of the Trade Date and the Effective Date and
are hereby deemed to be repeated to Dealer as if set forth herein.

9

 

     (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) (A) 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, are not, and shall not be, subject to a
“restricted period,” as such term is defined in Regulation M under the Exchange Act
(“Regulation M”) and (B) Issuer shall not engage in any “distribution,” as such term is
defined in Regulation M, other than a distribution meeting the requirements of the
exceptions set forth in sections 101(b)(10) and 102(b)(7) of Regulation M, until the second
Exchange Business Day immediately following the Settlement Period.

     (xi) During the Settlement Period, neither Issuer nor any “affiliate” or “affiliated
purchaser” (each as defined in Rule 10b-18 of 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.

     (b) Each of Dealer and Issuer agrees and represents that it is an “eligible contract
participant” as defined in Section 1a(12) of 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 and its investments in and
liabilities in respect of the Transaction, which it understands are not readily marketable, are not
disproportionate to its net worth, and it is able to bear any loss in connection with the
Transaction, including the loss of its entire investment in the Transaction, (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, (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, (v) its financial condition
is such that it has no need for liquidity with respect to its investment in the Transaction and no
need to dispose of any portion thereof to satisfy any existing or contemplated undertaking or
indebtedness and is capable of assessing the merits of and understanding (on its own behalf or
through independent professional advice), and understands and accepts, the terms, conditions and
risks of the Transaction.

     (d) Each of Dealer and 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 (A) that 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 is a “settlement payment,” as such term is defined in Section
741(8) 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 is a
“transfer,” as such term is defined in Section 101(54) of the Bankruptcy Code, and (B) that Dealer
is entitled to the protections afforded by, among other sections, Sections 362(b)(6), 362(b)(17),
546(e), 546(g), 555 and 560 of the Bankruptcy Code.

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

     8. Other Provisions:

     (a) 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

10

 

12.9 of the Equity Definitions (except in the event of a Tender Offer, a Merger Event,
Insolvency or Nationalization in each case, in which the consideration or proceeds to be paid to
holders of Shares consists solely of cash) or pursuant to Section 6(d)(ii) of the Agreement (except
in the event of an Event of Default in which Issuer is the Defaulting Party or a Termination Event
in which Issuer is the Affected Party that resulted from an event or events within Issuer’s
control, other than an Additional Termination Event of the type described in Section 8(e)) (a
“Payment Obligation”), Issuer shall have the right, in its sole discretion, to satisfy any such
Payment Obligation by the Share Termination Alternative (as defined below) by giving irrevocable
telephonic notice to Dealer, confirmed in writing within one Scheduled Trading Day, between the
hours of 9:00 A.M. and 4:00 P.M. New York City time on the Merger Date, Tender Offer Date,
Announcement Date or Early Termination Date, as applicable (“Notice of Share Termination”). Upon
such Notice of Share Termination, the following provisions shall apply on the Scheduled Trading Day
immediately following the Merger Date, the Tender Offer Date, Announcement Date or Early
Termination Date, 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 or Delisting, one Share or, in
the case of an Insolvency,
Nationalization, Merger Event or Tender
Offer, a 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. 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 as a result of the fact that Seller
is the Issuer of the Shares and under
Maritime Laws (as defined below)
applicable to Issuer) and 9.12 of the
Equity Definitions will be applicable as
if “Physical Settlement” applied to the
Transaction, except that all

11

 

	 	 	 
	 

	 	references to “Shares” shall be read as references to “Share
Termination Delivery Units”. If, in the reasonable judgment of
Dealer, for any reason, any securities comprising the Share
Termination Delivery Units deliverable pursuant to this Section
8(a) would not be immediately freely transferable by Dealer under
Rule 144(k) under the Securities Act, then Dealer may elect to
either (x) accept delivery of such securities notwithstanding any
restriction on transfer or (y) have the provisions set forth in
Section 8(b) below apply.

The parties hereby agree that, notwithstanding anything to the contrary herein or in the Agreement,
following the payment of the Premium, in the event that an Early Termination Date (whether as a
result of an Event of Default or a Termination Event) occurs or is designated with respect to the
Transaction or the Transaction is terminated or cancelled pursuant to Article 12 of the Equity
Definitions and, as a result, Dealer would owe to Issuer an amount calculated under Section 6(e) of
the Agreement or Article 12 of the Equity Definitions, such amount shall be deemed to be zero.

     (b) Registration/Private Placement Procedures. (i) With respect to the Transaction, the
following provisions shall apply to the extent provided for above opposite the caption “Net Share
Settlement” in Section 2 or in paragraph (a) of this Section 8. If so applicable, then, at the
election of Issuer by notice to Dealer within one Exchange Business Day after the relevant delivery
obligation arises, but in any event at least one Exchange Business Day prior to the date on which
such delivery obligation is due, either (A) all Shares or Share Termination Delivery Units, as the
case may be, delivered by Issuer to Dealer shall be, at the time of such delivery, covered by an
effective registration statement of Issuer for immediate resale by Dealer (such registration
statement and the corresponding prospectus (the “Prospectus”) (including, without limitation, any
sections describing the plan of distribution) in form and content commercially reasonably
satisfactory to Dealer) or (B) Issuer shall deliver additional Shares or Share Termination Delivery
Units, as the case may be, so that the value of such Shares or Share Termination Delivery Units, as
determined in a commercially reasonable manner by the Calculation Agent to reflect an appropriate
liquidity discount, equals the value of the number of Shares or Share Termination Delivery Units
that would otherwise be deliverable if such Shares or Share Termination Delivery Units were freely
tradeable (without prospectus delivery) upon receipt by Dealer (such value, the “Freely Tradeable
Value”); provided that, if requested by Dealer, Issuer shall make the election described in this
clause (B) with respect to Shares delivered on all Settlement Dates no later than one Exchange
Business Day prior to the first Expiration Date, and the applicable procedures described below
shall apply to all Shares delivered on the Settlement Dates on an aggregate basis. (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) If Issuer makes the election described in clause (b)(i)(A) above:

     (A) Dealer (or an affiliate of Dealer designated by Dealer) shall be afforded a
reasonable opportunity to conduct a due diligence investigation with respect to Issuer that
is customary in scope for underwritten offerings of equity securities and that yields
results that are commercially reasonably satisfactory to Dealer or such affiliate, as the
case may be; and

     (B) Dealer (or an affiliate of Dealer designated by Dealer) and Issuer shall enter
into an agreement (a “Registration Agreement”) on commercially reasonable terms in
connection with the public resale of such Shares or Share Termination Delivery Units, as
the case may be, by Dealer or such affiliate substantially similar to underwriting
agreements customary for underwritten offerings of equity securities, in form and substance
commercially reasonably satisfactory to Dealer or such affiliate and Issuer, which
Registration Agreement shall include, without limitation, provisions substantially similar
to those contained in such underwriting 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 registration costs and all fees and expenses of counsel for Dealer, and shall
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 Prospectus.

12

 

     (iii) If Issuer makes the election described in clause (b)(i)(B) above:

     (A) Dealer (or an affiliate of Dealer designated by Dealer) and any potential
institutional purchaser of any such Shares or Share Termination Delivery Units, as the case
may be, 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), subject to execution by such recipients of
customary confidentiality agreements reasonably acceptable to Issuer;

     (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 Shares or Share Termination Delivery Units,
as the case may be, 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 Shares or Share Termination Delivery Units 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 Shares or any securities issued by Issuer comprising such Share
Termination Delivery Units, 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 Shares or 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 Shares. If Issuer makes the election described in clause (b)(i)(B) of paragraph
(b) of this Section 8, then Dealer or its affiliate may sell (which sale shall be made in a
commercially reasonable manner) such Shares or Share Termination Delivery Units, 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

13

 

be, so that the realized net proceeds of such sales exceed the Freely Tradeable Value. If any
of such delivered Shares or Share Termination Delivery Units remain after such realized net
proceeds exceed the Freely Tradeable Value, Dealer shall return such remaining Shares or Share
Termination Delivery Units to Issuer. If the Freely Tradeable Value exceeds 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 (“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).

     (d) Ownership Limitations. 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 if, immediately upon giving effect to such receipt of such Shares, (i) the Beneficial
Ownership of Dealer Group would be equal to or greater than 8.5% 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, (iii) the
Maritime Law Ownership Percentage of the Maritime Law Dealer Group would be greater than 4.9% of
the outstanding Shares, unless Dealer has established to the reasonable satisfaction of Issuer that
it (or the person designated to take delivery) is a citizen of the United States for purposes of
the U.S. coastwise trade under the Maritime Laws, (iv) such Shares would be “Excess Shares”
(“Excess Shares”) as defined in Issuer’s Amended and Restated Certificate of Incorporation (the
“Certificate”), or (v) the receipt of such Shares would require prior regulatory approval by any
competent regulatory authority, and such prior approval had not been obtained, or would otherwise
be prohibited under applicable state or Federal laws, regulations or regulatory orders applicable
to ownership of Shares (each of clause (i) through (v) 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, Issuer’s obligation to make such delivery shall not be extinguished and Issuer shall
make such delivery as promptly as practicable after, but in no event later, in the case of an
Ownership Limitation of the type described in clause (i) or (ii) above, 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. If any delivery owed to Dealer hereunder is not made, in
whole or in part, as a result of an Ownership Limitation of the type described in clause (iii),
(iv) or (v) above, the number of Shares owed by Issuer shall be increased, on every calendar day
(each, a “calculation day”) following the day on which the Share delivery obligation that was not
so satisfied was due (or would have been due were it not for this Section 8(d)), by an amount equal
to the product of (i) the number of Shares so owed (and not yet delivered) on the calendar day
immediately preceding the calculation day, (ii) 0.02 and (iii) 1/365. “Beneficial Ownership” means
the “beneficial ownership” (within the meaning of Section 13 of the Exchange Act and the rules
promulgated thereunder) of Shares by Dealer or any affiliate of Dealer subject to aggregation with
Dealer under such Section 13 and rules (collectively, “Dealer Group”). “Maritime Law Ownership
Percentage” means the ownership, as construed under the Maritime Laws, of Shares by Dealer or any
person whose ownership would be aggregated with that of Dealer or Dealer’s parent entity under the
Maritime Laws (collectively, the “Maritime Law Dealer Group”). “Maritime Laws” means, collectively
and without duplication, Chapters 121 and 505 of Title 46 of the United States Code and any
successor statute thereto, and the regulations promulgated under such Title or successor statute
or, to the extent remaining in force, under any predecessor statute, in each case as amended or
supplemented from time to time, or any “Maritime Laws” as defined in the Certificate. Issuer
represents and warrants that, assuming the accuracy of any factual information regarding Dealer
that is provided by Dealer to Issuer upon Issuer’s request, any Shares delivered by Issuer to
Dealer pursuant to the Transaction shall not be Excess Shares, and the issuance and delivery of
such Shares shall have been approved by the board of directors of Issuer. If Dealer designates any
person to receive any Shares pursuant to Section 8(p), clauses (iii) and (iv) of this Section 8(d)
shall apply as if such person were Dealer. If Issuer is unable to deliver any Shares to Dealer as a
result of this Section 8(d), Issuer shall use commercially reasonable efforts to enable itself to
so deliver such Shares as promptly as practicable; provided that Issuer may at any time following
the Settlement Date for the Component with the latest Settlement Date, upon one Exchange Business
Day’s prior written notice to

14

 

Dealer, elect to deliver cash in lieu of any or all such Shares, in which case the Shares for
which cash delivery has been so elected shall be valued by the Calculation Agent using a valuation
period reasonably designed to allow Dealer to unwind its hedging position in connection with the
Transaction in compliance with applicable law, including Rule 10b-18. Issuer’s right to elect cash
pursuant to the foregoing sentence shall be subject to Issuer giving representations, warranties
and covenants customary for transactions under Rule 10b5-1 under the Exchange Act and satisfactory
to Dealer. Issuer shall promptly notify Dealer if at any time either (i) any purported transfer of
any shares of any class or series of capital stock of Issuer is void and ineffective pursuant to
paragraph 4(a) of Article V of the Certificate or (ii) any shares of any class or series of capital
stock of Issuer are “Excess Shares” pursuant to paragraph 5 of Article V of the Certificate. Issuer
shall provide Dealer with a copy of any filings submitted to any regulatory authority relating to
Issuer’s or Issuer’s stockholders’ citizenship under the Maritime Laws so long as Dealer (or any
assignee of Dealer) has agreed to keep any such filings and the information contained therein
confidential on terms reasonably acceptable to Issuer and Dealer. Dealer acknowledges that Dealer
will not have any rights as a holder of Issuer’s common stock with respect to Shares, prior to the
delivery thereof hereunder, that Issuer is unable to deliver as a result of this Section 8(d).
Issuer acknowledges that, as a result of this Section 8(d), it will not treat Dealer (or any
affiliate or designee of Dealer) as the owner, for any purpose (including, without limitation, for
purposes of the Maritime Laws or Article V of the Certificate), of Shares, prior to the delivery of
such Shares hereunder, that Issuer is unable to deliver as a result of 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 1,380,000 Shares (as such number may be adjusted from time to time in
accordance with the provisions hereof) (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”). Following the Trade
Date, Issuer agrees to use best efforts to obtain approval from its shareholders (including,
without limitation, to seek such approval at its next annual meeting of shareholders and, if
needed, the annual meeting for each following calendar year) to increase the number of authorized
but unissued Shares such that the number of Available Shares shall be equal to at least two times
the aggregate Number of Shares for all Components. Upon Issuer obtaining such approval for such an
increase, the Capped Number shall automatically increase to two times the aggregate Number of
Shares for all Components. If Issuer does not succeed in obtaining such approval for such an
increase within 24 months following the Trade Date, then an Additional Termination Event shall
occur and be continuing with respect to which the Transaction (or a portion of the Transaction, at
the reasonable discretion of the Calculation Agent) shall be the sole Affected Transaction and
Issuer shall be the sole Affected Party. For the avoidance of doubt, such Additional Termination
Event shall be continuing, and Dealer shall have the right to designate an Early Termination Date
in respect thereof, from the date 24 months following the Trade Date until Issuer succeeds in
getting such approval. 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 obligated to deliver, from time to time until the obligations set forth
in this paragraph have been satisfied in full, the Deficit Shares when, and to the extent that, (A)
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), (B)
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 and (C) Issuer additionally
authorizes any unissued Shares (such events as set forth in clauses (A), (B) and (C) above,
collectively, the “Share Issuance Events”). Issuer shall promptly notify Dealer of the occurrence
of any of the Share Issuance Events (including the number of Shares subject to clause (A), (B) or
(C) and the corresponding number of Shares to be delivered) and, as promptly as reasonably
practicable, deliver such Shares thereafter. Issuer shall not, until Issuer’s obligations to
Dealer under the Transaction have been satisfied in full, use any Shares that become available for
potential delivery to Dealer as a result of any Share Issuance Event for the settlement or
satisfaction of any transaction or obligation other than the Transaction or reserve any such Shares
for future issuance for any purpose other than to satisfy Issuer’s obligations to Dealer under the
Transaction, except

15

 

that Issuer may satisfy its obligations in respect of the Transaction out of any such Shares
on a pro rata basis with its obligations to any other dealers to whom Issuer has issued
substantially identical warrants on the same date as the issuance of the Warrants issued hereunder.

     (f) 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.

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

     (i) 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 a
material 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)”; and

     (ii) Section 11.2(e)(vii) of the Equity Definitions is hereby amended by deleting the
words “diluting or concentrative” and replacing them with “material”.

     (h) 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 without the consent of Issuer.

     (i) 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.

     (j) 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;

     (ii) any Person (as defined below) acquires beneficial ownership (determined in
accordance with Rule 13d-3 under the Exchange Act), directly or indirectly, through a
purchase, merger or other acquisition transaction or series of transactions, of shares of
Issuer’s capital stock entitling the Person to exercise 50% or more of the total voting
power of all shares of Issuer’s capital stock entitled to vote generally in elections of
directors, other than an acquisition by Issuer, any of Issuer’s subsidiaries or any of
Issuer’s employee benefit plans;

16

 

     (iii) Issuer (x) merges or consolidates with or into any other Person, other than a
subsidiary of Issuer, another Person merges with or into Issuer, or Issuer conveys, sells,
transfers or leases all or substantially all of its assets to another Person or (y) engages
in any recapitalization, reclassification or other transaction in which all or
substantially all Shares are exchanged for or converted into cash, securities or other
property, in each case, other than any merger or consolidation:

	 	(A)	 	that does not result in a reclassification, conversion,
exchange or cancellation of the outstanding Shares; or
	 
	 	(B)	 	which is effected solely to change Issuer’s jurisdiction of
incorporation and results in a reclassification, conversion or exchange of
outstanding Shares solely into shares of common stock of the surviving entity;

     (iv) Issuer is liquidated or dissolved or holders of Issuer’s common stock approve any
plan or proposal for Issuer’s liquidation or dissolution;

     (v) at any time Issuer’s Continuing Directors (as defined below) do not constitute a
majority of Issuer’s board of directors (or, if applicable, a successor Person to Issuer);
or

     (vi) at any time at which any Excess Ownership Position (as defined below) occurs,
Dealer, in its discretion, is unable to effect a transfer or assignment to a third party of
the Transaction or any other transaction between the parties after using its commercially
reasonable efforts on pricing terms reasonably acceptable to Dealer such that an Excess
Ownership Position no longer exists; provided that Dealer shall treat only that portion of
the Transaction as the Affected Transaction as necessary so that such Excess Ownership
Position no longer exists.

Notwithstanding the foregoing, a transaction set forth in clause (ii), (iii) or (v) above will not
constitute an Additional Termination Event if at least 95% of the consideration paid for the Shares
(excluding cash payments for fractional shares and cash payments made pursuant to dissenters’
appraisal rights and cash dividends) in a merger or consolidation or such other transaction
otherwise constituting an Additional Termination Event under clauses (ii) or (iii) above consists
of shares of common stock traded 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 traded or
quoted immediately following the completion of the merger or consolidation or such other
transaction) (“Listed Shares”).

     “Person” includes any syndicate or group that would be deemed to be a “person” under Section
13(d)(3) of the Exchange Act.

     “Continuing Directors” means (i) individuals who on the date hereof constituted Issuer’s board
of directors and (ii) any new directors whose election to Issuer’s board of directors or whose
nomination for election by Issuer’s stockholders was approved by at least a majority of Issuer’s
directors then still in office (or a duly constituted committee thereof), either who were directors
on the date hereof or whose election or nomination for election was previously so approved.

     “Excess Ownership Position” means any of the following: (i) the Beneficial Ownership of Dealer
Group is equal to or greater than 8.5% of the outstanding Shares, (ii) Dealer or any “affiliate” or
“associate” of Dealer would own in excess of 13% of the outstanding Shares for purposes of Section
203 of the Delaware General Corporation Law, (iii) the Maritime Law Ownership Percentage of the
Maritime Law Dealer Group would be equal to or greater than 4% of the outstanding Shares, or (iv)
the aggregate percentage of non-U.S. citizen owners (as determined pursuant to the Certificate) of
Shares shall equal or exceed 18% of the outstanding Shares.

     (k) Effectiveness. If, prior to the Effective Date, Dealer reasonably determines 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.

17

 

     (l) Extension of Settlement. Dealer may divide any Component into additional Components and
designate the Expiration Date and the Number of Warrants for each such Component if Dealer
determines, in its reasonable discretion, that such further division is necessary or advisable to
preserve Dealer’s hedging activity hereunder in light of existing liquidity conditions in the cash
market or stock loan market or to enable Dealer to effect purchases of Shares in connection with
its hedging activity hereunder in a manner that would, if Dealer were Issuer or an affiliated
purchaser of Issuer, be in compliance with applicable legal and regulatory requirements.

     (m) No Netting and Set-off. The provisions of Section 2(c) of the Agreement shall not apply
to the Transaction. Each party waives any and all rights it may have to set-off delivery or
payment obligations it owes to the other party under the Transaction against any delivery or
payment obligations owed to it by the other party, whether arising under the Agreement, under any
other agreement between parties hereto, by operation of law or otherwise.

     (n) Amendment. If the Initial Purchasers party to the Purchase Agreement exercise their right
to purchase additional convertible notes as set forth therein, then, at the discretion of Issuer,
Dealer and Issuer will either enter into a new confirmation evidencing additional warrants to be
issued by Issuer to Dealer or amend this Confirmation to evidence such additional warrants (in each
case on pricing terms acceptable to Dealer and Issuer) (such additional confirmation or amendment
to this Confirmation to provide for the payment by Dealer to Issuer of the additional premium
related thereto in an amount to be agreed between the parties).

     (o) Lock Up. Prior to the first anniversary of the Trade Date, if the Initial Purchasers
party to the Purchase Agreement exercise their right to purchase additional convertible notes set
forth therein and Issuer does not elect to issue the maximum number of Additional Warrants as
provided in paragraph (n) above, Issuer shall not issue or enter into any warrant, a call option, a
variable forward or other derivative linked to the Shares (collectively, “Warrants”), whether cash
settled and/or physically settled and/or net share settled, without a prior written consent of
Dealer which shall not be unreasonably withheld, unless such Warrants are issued (i) pursuant to
any present or future employee, director or consultant benefit plan or program of Issuer or any
hedging arrangements in respect thereof, (ii) to all Issuer’s stockholders as a free distribution
or a distribution for less than the fair market value of such Warrants (as determined by the
Calculation Agent), (iii) as part of mandatorily convertible units in a bona fide capital raising
transaction unrelated to the convertible notes sold pursuant to the Purchase Agreement, or (iv) as
part of a bona fide Share repurchase transaction unrelated to the convertible notes sold pursuant
to the Purchase Agreement. “Additional Warrants” shall equal the product of (i) the Warrant
Entitlement, (ii) the initial conversion rate of the convertible notes and (iii) the aggregate
principal amount of the additional convertible notes purchased by the Initial Purchasers divided by
USD1,000.

     (p) 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’s 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. In addition, Dealer may assign
its right to receive and Shares or other securities from Issuer to any person or designate any
person to receive such Shares or other securities (subject to Section 8(d)).

     (q) Termination Amounts. Notwithstanding anything to the contrary in the Agreement or the
Equity Definitions, any determination of Loss or any amount payable upon cancellation or
termination of the Transaction pursuant to Article 12 of the Equity Definitions shall, in a
commercially reasonable manner, take into account any costs or losses incurred by Dealer or any of
its affiliates in connection with Dealer’s (or such affiliate’s) hedging activities in respect of
the Transaction as a result of the provisions of Article V of the Certificate (whether before or in
connection with the termination or cancellation of the Transaction).

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

18

 

     (s) Waiver of Jury Trial. Each party waives, to the fullest extent permitted by applicable
law, any right it may have to a trial by jury in respect of any suit, action or proceeding relating
to the Transaction. Each party (i) certifies that no representative, agent or attorney of the
other party has represented, expressly or otherwise, that such other party would not, in the event
of such a suit, action or proceeding, seek to enforce the foregoing waiver and (ii) acknowledges
that it and the other party have been induced to enter into the Transaction by, among other things,
the mutual waivers and certifications provided herein.

     (t) Submission to Jurisdiction. Section 13(b) of the Agreement is deleted in its entirety and
replaced by the following: “Each party hereby irrevocably and unconditionally submits for itself
and its property in any legal action or proceeding by the other party against it relating to this
Agreement and/or any Transaction, or for recognition and enforcement of any judgment in respect
thereof, to the exclusive jurisdiction of the Supreme Court of the State of New York, sitting in
New York County, the courts of the United States of America for the Southern District of New York
and appellate courts from any thereof. Nothing in any Confirmation or this Agreement precludes
either party from bringing Proceedings in any other jurisdiction if (A) the courts of the State of
New York or the United States of America for the Southern District of New York lack jurisdiction
over the parties or the subject matter of the Proceedings or declines to accept the Proceedings on
the grounds of lacking such jurisdiction; (B) the Proceedings are commenced by a party for the
purpose of enforcing against the other party’s property, assets or estate any decision or judgment
rendered by any court in which Proceedings may be brought as provided hereunder; (C) the
Proceedings are commenced to appeal any such court’s decision or judgment to any higher court with
competent appellate jurisdiction over that court’s decisions or judgments if that higher court is
located outside the State of New York or Borough of Manhattan, such as a federal court of appeals
or the U.S. Supreme Court; or (D) any suit, action or proceeding has been commenced in another
jurisdiction by or against the other party or against its property, assets or estate and, in order
to exercise or protect its rights, interests or remedies under this Agreement or any Confirmation,
the party (1) joins, files a claim, or takes any other action, in any such suit, action or
proceeding, or (2) otherwise commences any Proceeding in that other jurisdiction as the result of
that other suit, action or proceeding having commenced in that other jurisdiction.”

     (u) Counterparts. This Confirmation may be executed in several counterparts, each of which
shall be deemed an original but all of which together shall constitute one and the same instrument.

     9. Terms Relating to the Agent:

     (a) The Agent is registered as a broker-dealer with the U.S. Securities and Exchange
Commission and the National Association of Securities Dealers, Inc., is acting hereunder for and on
behalf of Dealer solely in its capacity as agent for Dealer pursuant to instructions from Dealer,
and is not and will not be acting as the Issuer’s agent, broker, advisor or fiduciary in any
respect under or in connection with the Transaction.

     (b) In addition to acting as Dealer’s agent in executing the Transaction, the Agent is
authorized from time to time to give written payment and/or delivery instructions to the Issuer
directing it to make its payments and/or deliveries under the Transaction to an account of the
Agent for remittance to Dealer (or its designee), and for that purpose any such payment or delivery
by the Issuer to the Agent shall be treated as a payment or delivery to Dealer.

     (c) Except as otherwise provided herein, any and all notices, demands, or communications of
any kind transmitted in writing by either Dealer or the Issuer under or in connection with the
Transaction will be transmitted exclusively by such party to the other party through the Agent at
the following address:

Wachovia Capital Markets, LLC

201 South College Street, 6th Floor

Charlotte, NC 28288-0601

Facsimile No.: (704) 383-8425

Telephone No.: (704) 715-8086

19

 

     Attention: Equity Derivatives

     (d) The Agent shall have no responsibility or liability to Dealer or the Issuer for or arising
from (i) any failure by either Dealer or the Issuer to perform any of their respective obligations
under or in connection with the Transaction, (ii) the collection or enforcement of any such
obligations, or (iii) the exercise of any of the rights and remedies of either Dealer or the Issuer
under or in connection with the Transaction. Each of Dealer and the Issuer agrees to proceed
solely against the other to collect or enforce any such obligations, and the Agent shall have no
liability in respect of the Transaction except for its gross negligence or willful misconduct in
performing its duties as the agent of Dealer.

     (e) Upon written request, the Agent will furnish to Dealer and the Issuer the date and time of
the execution of the Transaction and a statement as to the source and amount of any remuneration
received or to be received by the Agent in connection with the Transaction.

20

 

     Issuer hereby agrees (a) to check this Confirmation carefully and immediately upon receipt so
that errors or discrepancies can be promptly identified and rectified and (b) to confirm that the
foregoing (in the exact form provided by Dealer) correctly sets forth the terms of the agreement
between Dealer and Issuer with respect to the Transaction, by manually signing this Confirmation or
this page hereof as evidence of agreement to such terms and providing the other information
requested herein and immediately returning an executed copy to Dealer, Equity Derivatives
Documentation Unit, Facsimile No. (212) 214-5913 or by email to
equity.confirms@wachovia.com.

	 	 	 	 	 
	 	 	Yours faithfully,
	 
	 	 	 	 
	 	 	WACHOVIA BANK, NATIONAL ASSOCIATION
	 
	 	 	 	 
	 	 	By: Wachovia Capital Markets, LLC, acting solely in its

capacity as its Agent
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Cathleen Burke
	 

	 	 	 	 
	 

	 	Name:
	 	Cathleen Burke
	 

	 	Title:
	 	Managing Director
	 
	 	 	 	 
	 	 	WACHOVIA CAPITAL MARKETS, LLC, acting solely in its
capacity as Agent of Wachovia Bank, National Association
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Cathleen Burke
	 

	 	 	 	 
	 

	 	Name:
	 	Cathleen Burke
	 

	 	Title:
	 	Managing Director

Agreed and Accepted By:

HORIZON LINES, INC.

	 	 	 	 	 
	By:

	 	/s/ Robert S. Zuckerman
 

Name: Robert S. Zuckerman
	 	 
	 

	 	Title: Secretary	 	 

 

 

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
	 	 	24,240
	 	 	11/13/2012	 
	 	2
	 	 	24,240
	 	 	11/14/2012	 
	 	3
	 	 	24,240
	 	 	11/15/2012	 
	 	4
	 	 	24,240
	 	 	11/16/2012	 
	 	5
	 	 	24,240
	 	 	11/19/2012	 
	 	6
	 	 	24,240
	 	 	11/20/2012	 
	 	7
	 	 	24,240
	 	 	11/21/2012	 
	 	8
	 	 	24,240
	 	 	11/23/2012	 
	 	9
	 	 	24,240
	 	 	11/26/2012	 
	 	10
	 	 	24,240
	 	 	11/27/2012	 
	 	11
	 	 	24,240
	 	 	11/28/2012	 
	 	12
	 	 	24,240
	 	 	11/29/2012	 
	 	13
	 	 	24,240
	 	 	11/30/2012	 
	 	14
	 	 	24,240
	 	 	12/3/2012	 
	 	15
	 	 	24,240
	 	 	12/4/2012	 
	 	16
	 	 	24,240
	 	 	12/5/2012	 
	 	17
	 	 	24,240
	 	 	12/6/2012	 
	 	18
	 	 	24,240
	 	 	12/7/2012	 
	 	19
	 	 	24,240
	 	 	12/10/2012	 
	 	20
	 	 	24,240
	 	 	12/11/2012	 
	 	21
	 	 	24,240
	 	 	12/12/2012	 
	 	22
	 	 	24,240
	 	 	12/13/2012	 
	 	23
	 	 	24,240
	 	 	12/14/2012	 
	 	24
	 	 	24,240
	 	 	12/17/2012	 
	 	25
	 	 	24,240
	 	 	12/18/2012	 
	 	26
	 	 	24,240
	 	 	12/19/2012	 
	 	27
	 	 	24,240
	 	 	12/20/2012	 
	 	28
	 	 	24,240
	 	 	12/21/2012	 
	 	29
	 	 	24,240
	 	 	12/24/2012	 
	 	30
	 	 	24,240
	 	 	12/26/2012	 
	 	31
	 	 	24,240
	 	 	12/27/2012	 
	 	32
	 	 	24,240
	 	 	12/28/2012	 
	 	33
	 	 	24,240
	 	 	12/31/2012	 
	 	34
	 	 	24,240
	 	 	1/2/2013	 
	 	35
	 	 	24,240
	 	 	1/3/2013	 
	 	36
	 	 	24,240
	 	 	1/4/2013	 
	 	37
	 	 	24,240
	 	 	1/7/2013	 
	 	38
	 	 	24,240
	 	 	1/8/2013	 
	 	39
	 	 	24,240
	 	 	1/9/2013	 
	 	40
	 	 	24,240
	 	 	1/10/2013	 
	 	41
	 	 	24,240
	 	 	1/11/2013	 
	 	42
	 	 	24,240
	 	 	1/14/2013	 
	 	43
	 	 	24,240
	 	 	1/15/2013	 
	 	44
	 	 	24,240
	 	 	1/16/2013	 
	 	45
	 	 	24,240
	 	 	1/17/2013	 
	 	46
	 	 	24,240
	 	 	1/18/2013	 
	 	47
	 	 	24,240
	 	 	1/22/2013	 
	 	48
	 	 	24,240
	 	 	1/23/2013	 
	 	49
	 	 	24,240
	 	 	1/24/2013	 
	 	50
	 	 	24,240
	 	 	1/25/2013	 
	 	51
	 	 	24,240
	 	 	1/28/2013	 

A-1 

 

	 	 	 	 	 	 	 	 	 
	Component Number	 	Number of Warrants	 	Expiration Date
	 	52
	 	 	24,240
	 	 	1/29/2013	 
	 	53
	 	 	24,240
	 	 	1/30/2013	 
	 	54
	 	 	24,240
	 	 	1/31/2013	 
	 	55
	 	 	24,240
	 	 	2/1/2013	 
	 	56
	 	 	24,240
	 	 	2/4/2013	 
	 	57
	 	 	24,240
	 	 	2/5/2013	 
	 	58
	 	 	24,240
	 	 	2/6/2013	 
	 	59
	 	 	24,240
	 	 	2/7/2013	 
	 	60
	 	 	24,240
	 	 	2/8/2013	 
	 	61
	 	 	24,240
	 	 	2/11/2013	 
	 	62
	 	 	24,240
	 	 	2/12/2013	 
	 	63
	 	 	24,240
	 	 	2/13/2013	 
	 	64
	 	 	24,240
	 	 	2/14/2013	 
	 	65
	 	 	24,240
	 	 	2/15/2013	 
	 	66
	 	 	24,240
	 	 	2/19/2013	 
	 	67
	 	 	24,240
	 	 	2/20/2013	 
	 	68
	 	 	24,240
	 	 	2/21/2013	 
	 	69
	 	 	24,240
	 	 	2/22/2013	 
	 	70
	 	 	24,240
	 	 	2/25/2013	 
	 	71
	 	 	24,240
	 	 	2/26/2013	 
	 	72
	 	 	24,240
	 	 	2/27/2013	 
	 	73
	 	 	24,240
	 	 	2/28/2013	 
	 	74
	 	 	24,240
	 	 	3/1/2013	 
	 	75
	 	 	24,240
	 	 	3/4/2013	 
	 	76
	 	 	24,240
	 	 	3/5/2013	 
	 	77
	 	 	24,240
	 	 	3/6/2013	 
	 	78
	 	 	24,240
	 	 	3/7/2013	 
	 	79
	 	 	24,240
	 	 	3/8/2013	 
	 	80
	 	 	24,240
	 	 	3/11/2013	 
	 	81
	 	 	24,240
	 	 	3/12/2013	 
	 	82
	 	 	24,240
	 	 	3/13/2013	 
	 	83
	 	 	24,240
	 	 	3/14/2013	 
	 	84
	 	 	24,240
	 	 	3/15/2013	 
	 	85
	 	 	24,240
	 	 	3/18/2013	 
	 	86
	 	 	24,240
	 	 	3/19/2013	 
	 	87
	 	 	24,240
	 	 	3/20/2013	 
	 	88
	 	 	24,240
	 	 	3/21/2013	 
	 	89
	 	 	24,240
	 	 	3/22/2013	 
	 	90
	 	 	24,240
	 	 	3/25/2013	 
	 	91
	 	 	24,240
	 	 	3/26/2013	 
	 	92
	 	 	24,240
	 	 	3/27/2013	 
	 	93
	 	 	24,240
	 	 	3/28/2013	 
	 	94
	 	 	24,240
	 	 	4/1/2013	 
	 	95
	 	 	24,240
	 	 	4/2/2013	 
	 	96
	 	 	24,240
	 	 	4/3/2013	 
	 	97
	 	 	24,240
	 	 	4/4/2013	 
	 	98
	 	 	24,240
	 	 	4/5/2013	 
	 	99
	 	 	24,240
	 	 	4/8/2013	 
	 	100
	 	 	24,291
	 	 	4/9/2013	 

A-2Exhibit 10.9

 

Exhibit 10.9

AMENDMENT TO CONFIRMATION

     THIS AMENDMENT (this “Amendment”) is made as of August 3, 2007, between Goldman, Sachs & Co.
(“Dealer”) and Horizon Lines, Inc. (“Issuer”).

     WHEREAS, Dealer and Issuer are parties to a Confirmation dated as of August 1, 2007 (the
“Confirmation”) evidencing an Issuer Warrant Transaction (Ref. No. SDB506480203);

     WHEREAS, the parties wish to amend the Confirmation on the terms and conditions set forth in
this Amendment;

     NOW, THEREFORE, in consideration of their mutual covenants herein contained, the parties
hereto agree as follows:

     Section 1. Terms Used but Not Defined Herein. Terms used but not defined herein shall have
the respective meanings given to them in the Confirmation.

     Section 2. Amendment to the Confirmation.

	 	(a)	 	The “Premium” under the Confirmation shall be USD 4,783,284.00. For the
avoidance of doubt, the Premium per Warrant set forth in the Confirmation shall remain
unchanged.
	 
	 	(b)	 	The “Number of Warrants” under Annex A shall be 35,552 for Components 1 through
26, 35,553 for Components 27 through 99, and 35,553.8 for Component 100.

     Section 3. Representations and Warranties.

     Issuer represents and warrants to Dealer as follows:

	 	(a)	 	On the date of this Amendment, (A) none of Issuer and its officers and
directors is aware of any material nonpublic information regarding Issuer or the Shares
and (B) the registration statement filed by Issuer with the Securities and Exchange
Commission (“SEC”) and became effective in accordance with the Securities Act of 1933,
as amended (the “Securities Act”), including all the documents filed by Issuer pursuant
to the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and
incorporated by reference therein, does 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.
	 
	 	(b)	 	Issuer is not entering into this Amendment 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.
	 
	 	(c)	 	The representations and warranties of Issuer set forth in Section 3 of the
Agreement and Section 7 of the Confirmation are true and correct and are hereby deemed
to be repeated to Dealer as if set forth herein.

     Section 4. Effectiveness. This Amendment shall become effective upon execution by the
parties hereto.

     Section 5. Counterparts. This Amendment may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if all of the signatures thereto and hereto
were upon the same instrument.

 

 

     Section 6. Governing Law. This Amendment shall be governed by and construed in accordance
with the laws of the State of New York.

     Section 7. Effectiveness of Confirmation. Except as amended hereby, all the terms of the
Confirmation shall remain and continue in full force and effect and are hereby confirmed in all
respects.

2

 

     IN WITNESS WHEREOF, the parties have signed this Amendment as of the date and year first above
written.

	 	 	 	 	 
	 	GOLDMAN, SACHS & CO.

 	 
	 	By:  	 	 
	 	 	Authorized Signatory 	 
	 	 	 	 
	 

Agreed and accepted by:

HORIZON LINES, INC.

	 	 	 	 	 
	By:

	 	/s/ Robert S. Zuckerman
 

	 	 
	Name:

	 	Robert S. Zuckerman	 	 
	Title:

	 	Secretary

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