Document:

exv10w2

 

Exhibit 10.2

EXECUTION COPY

Confirmation of OTC Convertible Note Hedge

	 	 	 	 	 
	Date:	 	June 29, 2007
	 
	 	 	 	 
	To:	 	Tektronix, Inc. (“Counterparty”)
	 
	 	 	 	 
	 

	 	Attention:
	 	Treasurer
	 

	 	Telephone No.:
	 	503-627-4622
	 

	 	Facsimile No.:
	 	502-627-6108
	 
	 	 	 	 
	From:	 	Merrill Lynch
International (“Dealer” or “MLI”)

Dealer Reference: 078182396

Dear Sir / Madam:

     The purpose of this letter agreement (this “Confirmation”) is to amend and restate the
terms and conditions of the above-referenced transaction entered into among Counterparty, Dealer
and Merrill Lynch, Pierce, Fenner & Smith Incorporated (the “Agent”) on the Trade Date specified
below (the “Transaction”). This Confirmation amends, restates and supersedes in its
entirety the Confirmation in respect of the Transaction dated as of June 25, 2007. This
Confirmation constitutes a “Confirmation” as referred to in the Agreement specified below.

     The definitions and provisions contained in the 2000 ISDA Definitions (the “Swap
Definitions”) and the 2002 ISDA Equity Derivatives Definitions (the “Equity
Definitions” and, together with the Swap Definitions, the “Definitions”), in each case
as published by the International Swaps and Derivatives Association, Inc. are incorporated into
this Confirmation. In the event of any inconsistency between the Swap Definitions and the Equity
Definitions, the Equity Definitions will govern, and in the event of any inconsistency between the
Definitions and this Confirmation, this Confirmation will govern. References herein to a
“Transaction” shall be deemed to be references to a “Share Option Transaction” for purposes of the
Equity Definitions and a “Swap Transaction” for the purposes of the Swap Definitions.

     This Confirmation evidences a complete binding agreement between you and us as to the terms of
the Transaction to which this Confirmation relates. This Confirmation (notwithstanding anything to
the contrary herein), shall be subject to, and form part of, an agreement in the 1992 form of the
ISDA Master Agreement (Multicurrency Cross Border) (the “Master Agreement” or
“Agreement”) as if we had executed an agreement in such form (but without any Schedule and
with the elections specified in the “ISDA Master Agreement” Section of this Confirmation) on the
Trade Date. In the event of any inconsistency between the provisions of that Agreement and this
Confirmation, this Confirmation will prevail for the purpose of this Transaction. The parties
hereby agree that the Transaction evidenced by this Confirmation shall be the only Transaction
subject to and governed by the Agreement.

     The parties acknowledge that this Confirmation is entered into on the date hereof with the
understanding that the provisions of the Note Indenture (as defined below) that are referred to
herein will conform to the descriptions thereof in the Offering Memorandum dated June 25, 2007 (the
“Offering Memorandum”) relating to the Reference Notes (as defined below). The parties agree that
in the event of any inconsistency between the Note Indenture as of the Effective Date and the
Offering Memorandum, the parties will amend this Confirmation in good faith to preserve the intent
of the parties.

     The terms of the particular Transaction to which this Confirmation relates
are as follows:

 

 

     General Terms: 

	 	 	 
	Trade Date:

	 	June 25, 2007
	 
	 	 
	Effective Date:

	 	The date of issuance of the Reference Notes.
	 
	 	 
	Option Style:

	 	Modified American, as described in “Procedures for Exercise” below.
	 
	 	 
	Option Type:

	 	Call
	 
	 	 
	Seller:

	 	Dealer
	 
	 	 
	Buyer:

	 	Counterparty
	 
	 	 
	Shares:

	 	The shares of common stock, without par value, of
Counterparty (Security Symbol: “TEK”) or such other securities or
property into which the Reference Notes are convertible on the
date of determination.
	 
	 	 
	Premium:

	 	 $59,616,000
	 
	 	 
	Premium Payment Date:

	 	The Effective Date
	 
	 	 
	Exchange:

	 	New York Stock Exchange
	 
	 	 
	Related Exchange(s):

	 	All Exchanges
	 
	 	 
	Reference Notes:

	 	The 100% Senior Convertible Notes in denominations of USD 1,000
principal amount, original principal amount USD 345,000,000.
	 
	 	 
	Applicable Portion of the
Reference Notes:

	 	 80.00%. For the avoidance of doubt, the Calculation Agent shall,
as it deems necessary, take into account the Applicable Portion of
the Reference Notes in determining or calculating any delivery or
payment obligations hereunder, whether upon a Conversion Date (as
defined below) or otherwise.
	 
	 	 
	Note Indenture:

	 	The indenture, dated as of closing of the issuance of the
Reference Notes, between Counterparty and U.S. Bank National
Association, as trustee relating to the Reference Notes, as the
same may be amended, modified or supplemented from time to time;
provided that amendments, modifications or supplements adopted, or
waivers obtained, of the kind specified under “Amendment Event”
below and adopted or obtained, in each case, without Dealer’s
consent, shall not be deemed part of the Note Indenture for
purposes of this Confirmation. Certain defined terms used herein
have the meanings assigned to them in the Note Indenture.
	 
	 	 
	Procedures for Exercise:
	 	 
	 
	 	 
	Potential Exercise Dates:

	 	As specified below under “Exercise Notice”.
	 
	 	 
	Conversion Date:

	 	Each “conversion date” for any Reference Note pursuant to the
terms of the Note Indenture occurring before the Expiration Date.
	 
	 	 
	 

	 	The principal amount of Reference Notes converted on each
Conversion Date shall be the “Conversion Amount” for such
Conversion Date.

Confirmation OTC Convertible Note Hedge (amended)

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	 	If the Conversion Amount for any Conversion Date is less than the
aggregate principal amount of Reference Notes then outstanding,
then the terms of this Transaction shall continue to apply,
subject to the terms and conditions set forth herein, with respect
to the remaining outstanding principal amount of the Reference
Notes.
	 
	 	 
	Exercise Period:

	 	The period from and excluding the Effective Date to and including
the Expiration Date.
	 
	 	 
	Expiration Date:

	 	The earliest of (i) the Final Maturity Date (as defined in the
Note Indenture) of the Reference Notes, (ii) the first day on
which none of such Reference Notes remain outstanding, whether by
virtue of conversion, issuer repurchase or otherwise and (iii) the
occurrence of an Additional Termination Event and designation of
an Early Termination Date hereunder in respect of the termination
of the Transaction in whole but not in part.
	 
	 	 
	Exercise Notice:

	 	Notwithstanding anything to the contrary in the Equity
Definitions, in order to exercise any Options hereunder, Buyer
shall provide Seller with written notice (“Exercise Notice”)
prior to 5:00 p.m. New York City time on the Business Day prior to
the first Trading Day in the Conversion Reference Period (all as
defined in the Note Indenture) relating to the Reference Notes
converted on the relevant Conversion Date of (i) the number of
Reference Notes being converted on the relevant Conversion Date,
(ii) the first Trading Day in the relevant Conversion Reference
Period for the Reference Notes and (iii) the applicable Cash
Percentage (as defined in the Note Indenture), if any;
provided
that with respect to Reference Notes converted during the period
beginning on May 15, 2012 and ending on the second Business Day
immediately preceding the Final Maturity Date (as defined in the
Note Indenture) of the Reference Notes, the related Exercise
Notice need not contain the information specified in clause (i) of
this sentence and, in order to exercise any Options hereunder,
Buyer shall deliver to Seller prior to 5:00 p.m. New York City
time on the Business Day (as defined in the Note Indenture) prior
to such Final Maturity Date a written notice (“Supplemental
Exercise Notice”) setting forth the number of Reference Notes
converted during such period; provided further that the delivery
by Buyer of an Exercise Notice after the Conversion Reference
Period has commenced but prior to the close of business on the
fifth Trading Day of such Conversion Reference Period shall be
effective, in which case the Settlement Method shall be Net Share
Settlement but without regard to subsection (ii) of the definition
of Net Share Settlement and subject to adjustments to the Net
Share Settlement Amount as specified below.
	 
	 	 
	Seller’s Telephone Number and
Telex and/or Facsimile Number
and Contact Details for purpose
of Giving Notice:

	 	Address: Merrill Lynch International

Merrill Lynch Financial Centre

2 King Edward Street

London EC1A 1HQ

Attention: Manager, Fixed Income Settlements Facsimile No.: +44
207 995 2004

Telephone No.: +44 207 995 3769
	 
	 	 
	Settlement Terms:
	 	 
	 
	 	 
	Settlement Method Election:

	 	Net Share Settlement or Net Cash Settlement consistent with
Buyer’s election with respect to the Reference Notes converted on
the applicable Conversion Date; provided that Net Share Settlement
shall apply in the event that Buyer elects to deliver any Shares
in connection with the applicable Conversion Date;

 Confirmation OTC Convertible Note Hedge (amended)

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	 	and provided
further that it shall be a condition for Buyer’s right to elect
Net Cash Settlement or settlement pursuant to clause (ii) of Net
Share Settlement that Buyer delivers to Seller with the related
Exercise Notice a representation signed by Buyer that Buyer has
publicly disclosed all material information necessary for Buyer to
be able to purchase or sell Shares in compliance with applicable
securities laws.
	 
	 	 
	Electing Party:

	 	Buyer
	 
	 	 
	Settlement Date:

	 	Subject to the delivery of an Exercise Notice to the Seller, on
the third (3rd) Business Day (as defined in the Note Indenture)
following the final Trading Day (as defined in the Note Indenture)
in the applicable Conversion Reference Period in respect of the
relevant Conversion Date.
	 
	 	 
	Net Share Settlement:

	 	In lieu of the obligations set forth in Sections 8.1 and 9.1 of
the Equity Definitions, Seller shall deliver to Buyer on the
related Settlement Date (i) a number of Shares equal to the
related Net Share Settlement Amount, provided that in the event
that the number of Shares calculated comprises any fractional
Share, only whole Shares shall be delivered and an amount equal to
the value of such fractional Share shall be payable by Seller to
Buyer in cash and (ii) an amount in cash equal to (x) the cash
amount, if any, paid by Buyer in excess of the principal amount of
the applicable Reference Notes for such Conversion Date pursuant
to Section 4.12 of the Note Indenture multiplied by (y) the
Applicable Portion of the Reference Notes, provided that the
delivery obligation set forth in clause (i) and (ii) of this
paragraph shall be determined excluding any Shares or cash that
Counterparty is obligated to deliver to holders of the applicable
Reference Notes as a result of any adjustments to the Conversion
Rate resulting from (a) a discretionary adjustment to the
Conversion Rate by Counterparty or (b) an adjustment to the
Conversion Rate as a result of a fundamental change as described
in Section 4.01(i) of the Note Indenture. The provisions of
Sections 9.1(c), 9.8, 9.9, 9.10, 9.11 and 9.12 of the Equity
Definitions shall apply to any delivery of Shares hereunder,
provided that the Representation and Agreement 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 Buyer is the issuer of the Shares.
	 
	 	 
	Net Cash Settlement:

	 	In lieu of the obligations set forth in Section 8.1 of the Equity
Definitions, on the Settlement Date Seller shall deliver to Buyer
an amount in cash equal to the related Net Cash Settlement Amount.
	 
	 	 
	Net Share Settlement Amount:

	 	For each Conversion Date, the number of Shares equal to the Shares
delivered by Buyer for such Conversion Date as required under the
Note Indenture multiplied by the Applicable Portion of the
Reference Notes, provided that if an Exercise Notice with respect
to such Conversion Date has not been delivered to the Seller prior
to the first Trading Day of the Conversion Reference Period
applicable to such Conversion Date, the Net Share Settlement
Amount for such Conversion Date shall be adjusted by the
Calculation Agent to account for the consequences of the reduced
number of Trading Days from the delivery of the Exercise Notice to
the end of the applicable Conversion Reference Period with respect
to such Conversion Date. No reduction of the Net Share Settlement
Amount shall reduce the Net Share Settlement Amount below zero.
	 
	 	 
	Net Cash Settlement Amount:

	 	For each Conversion Date, an amount equal to the cash delivered by
the Buyer in excess of the principal amount of the applicable
Reference Notes for such Conversion Date pursuant to Section 4.12
of the Note Indenture multiplied

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	 	by the Applicable Portion of the
Reference Notes, provided that such cash amount shall be
determined excluding any cash that Counterparty is obligated to
deliver to holders of the applicable Reference Notes as a result
of any adjustments to the Conversion Rate resulting from (i) a
discretionary adjustment to the Conversion Rate by Counterparty or
(ii) an adjustment to the Conversion Rate as a result of a
fundamental change as described in Section 4.01(i) of the Note
Indenture.
	 
	 	 
	Adjustments:
	 	 
	 
	 	 
	Method of Adjustment:

	 	Calculation Agent Adjustment; provided that the terms of this
Transaction shall be adjusted in a manner consistent with
adjustments of the Conversion Rate of the Reference Notes as
provided in the Note Indenture; provided further (without
limitation of the provisions set forth above under “Net Share
Settlement” and “Net Cash Settlement Amount”) that no adjustment
in respect of any Potential Adjustment Event or Extraordinary
Event shall be made hereunder as a result of any adjustments to
the Conversion Rate resulting from (i) a discretionary adjustment
to the Conversion Rate by Counterparty or (ii) an adjustment to
the Conversion Rate as a result of a fundamental change as
described in Section 4.01(i) of the Note Indenture.
	 
	 	 
	Potential Adjustment Event:

	 	Notwithstanding Section 11.2(e) of the Equity Definitions, a
“Potential Adjustment Event” means, subject to the preceding
paragraph, the occurrence of an event or condition that would
result in an adjustment of the Conversion Rate of the Reference
Notes pursuant to the Note Indenture.
	 
	 	 
	Extraordinary Events:
	 	 
	 
	 	 
	Merger Events:

	 	Notwithstanding Section 12.1(b) of the Equity Definitions, a
“Merger Event” means the occurrence of any event or condition to
which Section 4.10 of the Note Indenture applies.
	 
	 	 
	Consequences for Merger Events:
	 	 
	 
	 	 
	           Share-for-Share:

	 	The Transaction will be adjusted consistent with the Reference
Notes as provided in the Note Indenture.
	 
	 	 
	           Share-for-Other:

	 	The Transaction will be adjusted consistent with the Reference
Notes as provided in the Note Indenture.
	 
	 	 
	           Share-for-Combined:

	 	The Transaction will be adjusted consistent with the Reference
Notes as provided in the Note Indenture.
	 
	 	 
	Tender Offer:

	 	Applicable, subject to “Consequences of Tender Offers” below.
Notwithstanding Section 12.1(d) of the Equity Definitions, “Tender
Offer” means the occurrence of any event or condition set forth in
Section 4.06(e) of the Note Indenture.
	 
	 	 
	Consequences of Tender Offers:

	 	The Transaction will be adjusted consistent with the Reference
Notes as provided in the Note Indenture.
	 
	 	 
	Nationalization, Insolvency and
Delisting:

	 	Cancellation and Payment (Calculation Agent Determination),
provided Buyer shall determine whether payment shall be settled in
cash or Shares. In addition to the provisions of Section
12.6(a)(iii) of the Equity Definitions, it will also

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	 	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 Market or the NASDAQ Global Select 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:
	 	 
	 
	 	 
	           Change in Law:

	 	Applicable
	 
	 	 
	           Failure to Deliver:

	 	Applicable. If there is inability in the market to deliver Shares
due to illiquidity on a day that would have been a Settlement
Date, then the Settlement Date shall be the first succeeding
Exchange Business Day on which there is no such inability to
deliver, but in no such event shall the Settlement Date be later
than the date that is two (2) Exchange Business Days immediately
following what would have been the Settlement Date but for such
inability to deliver.
	 
	 	 
	           Insolvency Filing:

	 	Applicable
	 
	 	 
	           Hedging Disruption:

	 	Applicable
	 
	 	 
	           Increased Cost of
Hedging:

	 	Not Applicable
	 
	 	 
	           Loss of Stock Borrow:

	 	Not Applicable
	 
	 	 
	           Increased Cost of
Stock Borrow:

	 	Not Applicable
	 
	 	 
	           Hedging Party:

	 	Seller
	 
	 	 
	           Determining Party:

	 	Seller
	 
	 	 
	Non-Reliance:

	 	Applicable
	 
	 	 
	Agreements and Acknowledgments
Regarding Hedging Activities:

	 	Applicable
	 
	 	 
	Additional Acknowledgments:

	 	Applicable

Additional Agreements, Representations and Covenants of Buyer, Etc.: 

	1.	 	Buyer hereby represents and warrants to Seller, on each day from the Trade Date to and
including the earlier of (i) July 27, 2007 and (ii) the date by which Seller is able to
initially complete a hedge of its position relating to this Transaction, that:

	 	a.	 	it will effect (and cause any “affiliated purchaser” (as defined in Rule 10b-18
promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange
Act”)) to effect) any purchases, direct or indirect (including by means of any
cash-settled or other derivative instrument), of Shares or any security convertible
into or exchangeable or exercisable for Shares solely through Agent

Confirmation OTC Convertible Note Hedge (amended)

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	 	 	 	in a manner that would not cause any purchases by Seller of its hedge in connection
with this Transaction not to comply with applicable securities laws;
	 
	 	b.	 	it will not engage in, or be engaged in, any “distribution,” as such term is
defined in Regulation M promulgated under the Exchange Act, other than a distribution
meeting the requirements of the exceptions set forth in sections 101(b)(10) and
102(b)(7) of Regulation M (it being understood that Buyer makes no representation
pursuant to this clause in respect of any action or inaction taken by Seller or any
initial purchaser of the Reference Notes); and
	 
	 	c.	 	Buyer has publicly disclosed all material information necessary for Buyer to be
able to purchase or sell Shares in compliance with applicable federal securities laws.

	2.	 	If Buyer would be obligated to pay cash (other than payment of the Premium) to, or receive
cash from, Seller pursuant to the terms of this Agreement for any reason without having had
the right (other than pursuant to this paragraph (2)) to elect to deliver or receive Shares in
satisfaction of such payment obligation, then Buyer may elect (by giving notice to Seller no
later than 8 a.m. New York time on the Exchange Business Day immediately following the date of
occurrence of the event giving rise to such payment obligation) that such payment obligation
shall be satisfied by the delivery of a number of Shares (or, if the Shares have been
converted into other securities or property in connection with an Extraordinary Event, a
number or amount of such other securities or property as a holder of Shares would be entitled
to receive upon the consummation or closing of such Extraordinary Event) having a cash value
equal to the amount of such payment obligation. Such number or amount of Shares or other
securities or property to be delivered shall be determined by the Calculation Agent to be the
number of Shares or number or amount of such other securities or property that could be
purchased or sold, as applicable, over a reasonable period of time with the cash equivalent of
such payment obligation). Settlement relating to any delivery of Shares or other securities or
property pursuant to this paragraph (2) shall occur within a reasonable period of time.
Notwithstanding anything herein or in the Agreement to the contrary, the aggregate number of
Shares that Counterparty may be required to deliver to Dealer under this Transaction shall not
exceed 10,413,674 Shares, as adjusted by the Calculation Agent to account for any subdivision,
stock-split, stock combination, reclassification, certain distributions, dividends and
payments to holders of Buyer’s common stock or similar dilutive or anti-dilutive events with
respect to the Shares.
	 
	3.	 	Notwithstanding any provision in the Note Indenture, this Confirmation or the Agreement to
the contrary, each of the “Applicable Conversion Rate” (as such term is defined in the Note
Indenture), the Shares and cash amounts owed pursuant to Net Share Settlement, the Net Cash
Settlement Amount and any other amount hereunder determined by reference to the Applicable
Conversion Rate shall be determined without regard to any provisions in the Note Indenture
allowing Counterparty to unilaterally increase the “Applicable Conversion Rate” or any
adjustments resulting from a fundamental change.
	 
	4.	 	Counterparty is not, and after giving effect to the Transaction contemplated hereby, will not
be, an “investment company” as such term is defined in the Investment Company Act of 1940, as
amended.
	 
	5.	 	As of the Trade Date and each date on which a payment or delivery is made by Counterparty
hereunder, (i) the assets of Counterparty at their fair valuation exceed the liabilities of
Counterparty, including contingent liabilities; (ii) the capital of Counterparty is adequate
to conduct its business; and (iii) Counterparty has the ability to pay its debts and other
obligations as such obligations mature and does not intend to, or believe that it will, incur
debt or other obligations beyond its ability to pay as such obligations mature.
	 
	6.	 	The representations and warranties set forth in Section 1 of the Purchase Agreement (as
defined below) are hereby deemed to be repeated to Dealer as if set forth herein.

Confirmation OTC Convertible Note Hedge (amended)

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Additional Termination Events: 

The occurrence of any of the following shall be an Additional Termination Event for purposes of
this Transaction:

	1.	 	Amendment Event. If an Amendment Event (as defined below) occurs, Dealer shall have the right
to designate an Early Termination Date pursuant to Section 6(b) of the Agreement and,
notwithstanding anything to the contrary herein, no payments shall be required hereunder in
connection with such Amendment Event.
	 
	 	 	“Amendment Event” means that the Counterparty, without Dealer’s consent, amends,
modifies, supplements or obtains a waiver of (a) any term of the Note Indenture (as in
effect prior to such amendment, modification, supplement or waiver) or the Reference Notes
relating to the principal amount, coupon, maturity, repurchase obligation of the
Counterparty or redemption right of the Counterparty, (b) any term relating to conversion of
the Reference Notes, including, without limitation, any changes to the conversion price,
conversion settlement dates or conversion conditions or (c) any term that would require
consent of the holders of 100% of the principal amount of the Reference Notes to amend;
provided, for the avoidance of doubt, that an adjustment to the Conversion Rate in
accordance with the terms of the Note Indenture (as in effect prior to any amendment,
modification, supplement or waiver to which Dealer has not given its consent) shall not
constitute an Amendment Event;
	 
	2.	 	Repayment Event. If a Repayment Event (as defined below) occurs, Dealer shall have the right
to designate an Early Termination Date pursuant to Section 6(b) of the Agreement with respect
to this Transaction only to the extent of the principal amount of Reference Notes that cease
to be outstanding as a result of such Repayment Event and, notwithstanding anything to the
contrary herein, no payments shall be required hereunder in connection with such Repayment
Event.
	 
	 	 	“Repayment Event” means that (a) any Reference Notes are repurchased (whether in
connection with or as a result of a fundamental change or change of control, howsoever
defined, or for any other reason) by the Counterparty, (b) any Reference Notes are delivered
to the Counterparty in exchange for delivery of any property or assets of the Counterparty
or any of its subsidiaries (howsoever described), other than as a result of and in
connection with a Conversion Date, (c) any principal of any of the Reference Notes is repaid
prior to the Final Maturity Date (as defined in the Note Indenture) (whether following
acceleration of the Reference Notes or otherwise), provided that no payments of cash made in
respect of the conversion of a Reference Note shall be deemed a payment of principal under
this clause (c), (d) any Reference Notes are exchanged by or for the benefit of the holders
thereof for any other securities of the Counterparty or any of its Affiliates (or any other
property, or any combination thereof) pursuant to any exchange offer or similar transaction
or (e) any of the Reference Notes is surrendered by Counterparty to the trustee for
cancellation, other than registration of a transfer of such Reference Notes or as a result
of and in connection with a Conversion Date; provided, for the avoidance of doubt, that a
conversion of the Reference Notes pursuant to the Note Indenture shall not constitute a
Repayment Event.
	 
	3.	 	Initial Purchase Event. If an Initial Purchase Event (as defined below) occurs, this
Transaction shall terminate automatically in its entirety and, notwithstanding anything to the
contrary herein, only the payments specified below shall be required hereunder in connection
with such Initial Purchase Event.
	 
	 	 	“Initial Purchase Event” means that the transactions contemplated by the Purchase
Agreement among the Counterparty, Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Goldman, Sachs & Co. and Citigroup Global Markets Inc., dated as of June 25, 2007 (the
“Purchase Agreement”) shall fail to close for any reason by the closing date for the
offering of the Reference Notes as specified in the Purchase Agreement.
	 
	 	 	If an Initial Purchase Event occurs for any reason other than a breach of the Purchase
Agreement by the Initial Purchaser, then all payments previously made hereunder shall be
returned to the person making such payment, including the Premium (if paid), less an amount
equal to the product of (a) 6,942,449 Shares, (b) 0.50 and (c) an amount equal to the
excess, if any, of the closing price of the Shares on the Trade Date over the closing price
of the Shares on the date of the Initial Purchase Event (the “Break 

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	 	 	Expense”); provided that any negative amount shall be replaced by zero and provided
further that to the extent the Premium has not been paid, Buyer shall promptly pay Seller
the Break Expense. Seller and Buyer agree that actual damages would be difficult to
ascertain under these circumstances and that the amount of liquidated damages resulting from
the determination in the preceding sentence is a good faith estimate of such damages and not
a penalty.
	 
	 	 	If an Initial Purchase Event occurs due to a breach of the Purchase Agreement by the Initial
Purchaser, then all payments previously made hereunder, including the Premium, promptly
shall be returned to the person making such payment and no payments shall be required
hereunder in connection with such Initial Purchase Event.

Staggered Settlement: 

If Seller determines reasonably and in good faith that the number of Shares required to be
delivered to Buyer hereunder on any Settlement Date would exceed 8.0% of all outstanding Shares,
then Seller may, by notice to Buyer on or prior to such Settlement Date (a “Nominal Settlement
Date”), elect to deliver the Shares owed by it pursuant to Net Share Settlement (the “Share
Delivery Obligation”) on two or more dates (each, a “Staggered Settlement Date”) or at
two or more times on the Nominal Settlement Date as follows:

	1.	 	in such notice, Seller will specify to Buyer the related Staggered Settlement Dates (the
first of which will be such Nominal Settlement Date and the last of which will be no later
than twenty (20) Trading Days following such Nominal Settlement Date) or delivery times and
how it will allocate the Shares it is required to deliver hereunder among the Staggered
Settlement Dates or delivery times;
	 
	2.	 	the aggregate number of Shares that Seller will deliver to Buyer hereunder on all such
Staggered Settlement Dates or delivery times will equal the number of Shares that Seller would
otherwise be required to deliver on such Nominal Settlement Date; and
	 
	3.	 	the Net Share Settlement terms will apply on each Staggered Settlement Date, except that the
Shares comprising such Share Delivery Obligation will be allocated among such Staggered
Settlement Dates or delivery times as specified by Seller in the notice referred to in clause
(1) above.

Notwithstanding anything herein to the contrary, solely in connection with a Staggered Settlement
Date, Seller shall be entitled to deliver Shares to Buyer from time to time prior to the date on
which Seller would be obligated to deliver them to Buyer pursuant to Net Share Settlement terms set
forth above, and Buyer agrees to credit all such early deliveries against Seller’s obligations
hereunder in the direct order in which such obligations arise. No such early delivery of Shares
will accelerate or otherwise affect any of Buyer’s obligations to Seller hereunder.

Disposition of Hedge Shares: 

Counterparty hereby agrees that if, in the reasonable and good faith judgment of Seller based on
the advice of nationally recognized outside counsel, the Shares acquired by Seller for the purpose
of hedging its obligations pursuant to the Transaction (the “Hedge Shares”) cannot be sold
in the U.S. public market by Seller without registration under the Securities Act of 1933, as
amended (the “Securities Act”), Counterparty shall, at its election: (i) in order to allow
Seller to sell the Hedge Shares in a registered offering, make available to Seller an effective
registration statement under the Securities Act to cover the resale of such Hedge Shares and (a)
enter into an agreement, in form and substance satisfactory to Seller, substantially in the form of
an underwriting agreement for a registered offering, (b) provide accountant’s “comfort” letters in
customary form for registered offerings of equity securities, (c) provide disclosure opinions of
nationally recognized outside counsel to Counterparty reasonably acceptable to Seller, (d) provide
other customary opinions, certificates and closing documents customary in form for registered
offerings of equity securities and (e) afford Seller a reasonable opportunity to conduct a “due
diligence” investigation with respect to Counterparty customary in scope for underwritten offerings
of equity securities; provided, however, that if Seller, in its sole reasonable discretion, is not
satisfied with access to due diligence materials, the results of its due diligence investigation,
or the procedures and documentation for the registered offering referred to above, then clause (ii)
or clause (iii) of this Section shall apply at the election of

Confirmation OTC Convertible Note Hedge (amended)

- 9 -

 

Counterparty; (ii) in order to allow Seller to sell the Hedge Shares in a private placement, enter
into a private placement agreement substantially similar to private placement purchase agreements
customary for private placements of equity securities, in form and substance satisfactory to
Seller, including customary representations, covenants, blue sky and other governmental filings
and/or registrations, indemnities to Seller, due diligence rights (for Seller or any designated
buyer of the Hedge Shares from Seller), opinions and certificates and such other documentation as
is customary for private placements agreements, all reasonably acceptable to Seller (in which case,
the Calculation Agent shall make any adjustments to the terms of the Transaction that are necessary
to compensate Seller for any discount from the public market price of the Shares incurred on the
sale of Hedge Shares in a private placement); or (iii) purchase the Hedge Shares from Seller at the
VWAP Price on such Exchange Business Days, and in the amounts, requested by Seller. “VWAP
Price” means, on any Exchange Business Day, the per Share volume-weighted average price as
displayed under the heading “Bloomberg VWAP” on Bloomberg page TEK.N <equity> VAP (or any
successor thereto) in respect of the period from 9:30 a.m. to 4:00 p.m. (New York City time) on
such Exchange Business Day (or if such volume-weighted average price is unavailable, the market
value of one Share on such Exchange Business Day, as determined by the Calculation Agent using a
volume-weighted method).

Repurchase Notices: 

Counterparty shall, on any day on which Counterparty effects any repurchase of Shares, promptly
give Seller a written notice of such repurchase (a “Repurchase Notice”) on such day if
following such repurchase, the Notice Percentage as determined on such day is (i) greater than
8.02% and (ii) greater by 0.5% than the Notice Percentage included in the immediately preceding
Repurchase Notice (or, in the case of the first such Repurchase Notice, greater than the Notice
Percentage as of the date hereof). In the event that Counterparty fails to provide Seller with a
Repurchase Notice on the day and in the manner specified in this section, then Counterparty agrees
to indemnify and hold harmless Seller, its affiliates and their respective directors, officers,
employees, agents and controlling persons (Seller and each such person being an “Indemnified
Party”) from and against any and all losses, claims, damages and liabilities (or actions in
respect thereof), joint or several, to which such Indemnified Party may become subject under
applicable securities laws, including without limitation, Section 16 of the Exchange Act, relating
to or arising out of such failure. If for any reason the foregoing indemnification is unavailable
to any Indemnified Party or insufficient to hold harmless any Indemnified Party, then Counterparty
shall contribute, to the maximum extent permitted by law, to the amount paid or payable by the
Indemnified Party as a result of such loss, claim, damage or liability. In addition, Counterparty
will reimburse any Indemnified Party for all reasonable and documented expenses (including
reasonable counsel fees and expenses) as they are incurred (after notice to Counterparty) in
connection with the investigation of, preparation for or defense or settlement of any pending or
threatened claim or any action, suit or proceeding arising therefrom, whether or not such
Indemnified Party is a party thereto and whether or not such claim, action, suit or proceeding is
initiated or brought by or on behalf of Counterparty. This indemnity shall survive the completion
of the Transaction contemplated by this Confirmation and any assignment and delegation of the
Transaction made pursuant to this Confirmation or the Agreement shall inure to the benefit of any
permitted assignee of Seller. Counterparty will not be liable under this Indemnity provision to the
extent that any loss, claim, damage, liability or expense is found in a final judgment by a court
to have resulted from Dealer’s gross negligence or willful misconduct. The “Notice
Percentage” as of any day is the fraction, expressed as a percentage, (i) the numerator of
which is the product of (a) the Applicable Portion of the Reference Notes, (b) the number of
outstanding Reference Notes and (c) a number of Shares per Reference Note equal to the Conversion
Rate (as defined in the Note Indenture) and (ii) the denominator of which is the number of Shares
outstanding on such day.

Conversion Rate Adjustment Notices

In connection with any adjustments to the Conversion Rate under the terms of the Note Indenture,
Counterparty shall provide to Dealer a copy of the notice of adjustment required to be delivered to
the Trustee pursuant to Section 4.08 of the Note Indenture concurrently with filing of such notice
with the Trustee.

 Confirmation OTC Convertible Note Hedge (amended)

- 10 -

 

	 	 	 
	Compliance with 

Securities Laws:

	 	Each party acknowledges that the offer and sale of the Transaction
to it is intended to be exempt from registration under the
Securities Act by virtue of Section 4(2) thereof. Accordingly,
Buyer represents and warrants to Seller 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
and (iii) the disposition of the Transaction is restricted under
this Confirmation, the Securities Act and state securities laws.
	 
	 	 
	 

	 	Buyer further represents:
	 
	 	 
	 

	 	(a) Buyer is not entering into this Transaction 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);
	 
	 	 
	 

	 	(b) Buyer acknowledges that as of the date hereof and without
limiting the generality of Section 13.1 of the Equity Definitions,
Seller is not making any representations or warranties with
respect to the treatment of the Transaction under FASB Statements
149 or 150, EITF Issue No. 00-19 (or any successor issue
statements) or under FASB’s Liabilities & Equity Project.
	 
	 	 
	Account Details:

	 	Account for payments to Buyer:      To be advised
	 
	 	 
	 

	 	Account for payment to Seller:        To be advised
	 
	 	 
	 

	 	Accounts for deliveries of Shares:   To be advised
	 
	 	 
	Bankruptcy Rights:

	 	In the event of Buyer’s bankruptcy, Seller’s rights in connection
with this Transaction shall not exceed those rights held by common
shareholders. For the avoidance of doubt, the parties acknowledge
and agree that Seller’s rights with respect to any other claim
arising from this Transaction prior to Buyer’s bankruptcy shall
remain in full force and effect and shall not be otherwise
abridged or modified in connection herewith.
	 
	 	 
	Set-Off:

	 	Each party waives any and all rights it may have to set-off,
whether arising under any agreement, applicable law or otherwise.
	 
	 	 
	Collateral:

	 	None.
	 
	 	 
	Transfer:

	 	Buyer shall have the right to assign its rights and delegate its
obligations hereunder with respect to any portion of this
Transaction, subject to Seller’s consent, such consent not to be
unreasonably withheld; provided that such assignment or transfer
shall be subject to receipt by Seller of opinions and documents
reasonably satisfactory to Seller and effected on terms reasonably
satisfactory to the Seller with respect to any legal and
regulatory requirements relevant to the Seller; provided further
that Buyer shall not be released from its obligation to deliver
any Exercise Notice or its obligations pursuant to “Disposition of
Hedge Shares”, “Repurchase Notices” or “Conversion Rate Adjustment
Notices” above.
	 
	 	 
	 

	 	If, as determined in Seller’s sole discretion, the “beneficial
ownership” of it and those of its affiliates which are subject to
aggregation (within the meaning of Section 13 of the Exchange Act
and rules promulgated thereunder) could be deemed to exceed 8% of
Counterparty’s outstanding Shares, Seller may, without
Counterparty’s consent, transfer or assign all or any part of its
rights or obligations under this Transaction to reduce such
“beneficial ownership” to 7.5% to any third party with a rating
for its (or, if applicable, its Credit Support Provider’s) long
term, unsecured and unsubordinated indebtedness of AA or better by
Standard & Poor’s Ratings Service or its successor (“S&P”), or Aa3
or better by Moody’s Investors Service (“Moody’s”) or, if either
S&P or Moody’s ceases to rate such

 Confirmation OTC Convertible Note Hedge (amended)

- 11 -

 

	 	 	 
	 

	 	debt, at least an equivalent
rating or better by a substitute rating agency mutually agreed by
Company and Seller. If after Seller’s commercially reasonable
efforts, Seller is unable to effect such a transfer or assignment
on pricing terms reasonably acceptable to Seller and within a time
period reasonably acceptable to Seller of a sufficient number of
Options to reduce Seller’s “beneficial ownership” (within the
meaning of Section 13 of the Exchange Act and rules promulgated
thereunder) to 7.5% of Counterparty’s outstanding Shares or less,
Seller may designate any Exchange Business Day as an Early
Termination Date with respect to a portion (the “Terminated
Portion”) of this Transaction, such that its “beneficial
ownership” following such partial termination will be equal to or
less than 7.5%. In the event that Seller so designates an Early
Termination Date with respect to a portion of this Transaction, a
payment shall be made pursuant to Section 6 of the Agreement as if
(i) an Early Termination Date had been designated in respect of a
Transaction having terms identical to this Transaction and a
Number of Options equal to the Terminated Portion, (ii)
Counterparty shall be the sole Affected Party with respect to such
partial termination and (iii) such Transaction shall be the only
Terminated Transaction. In circumstances in which the foregoing
provisions relating to Seller’s right to transfer or assign its
rights or obligations under the Transaction are not applicable,
Seller may transfer any of its rights or delegate its obligations
under this Transaction with the prior written consent of Buyer,
which consent shall not be unreasonably withheld.
	 
	 	 
	Regulation:

	 	Seller is regulated by The Securities and Futures Authority Limited

Matters Relating to Agent:

	1.	 	Agent will be responsible for the operational aspects of the Transactions effected through
it, such as record keeping, reporting, and confirming Transactions to Buyer and Seller;
	 
	2.	 	Unless Buyer is a “major U.S. institutional investor,” as defined in Rule 15a-6 of the
Exchange Act, neither Buyer nor Seller will contact the other without the direct involvement
of Agent;
	 
	3.	 	Agent’s sole role under this Agreement and with respect to any Transaction is as an agent of
Buyer and Seller on a disclosed basis and Agent shall have no responsibility or liability to
Buyer or Seller hereunder except for gross negligence or willful misconduct in the performance
of its duties as agent. Agent is authorized to act as agent for Buyer, but only to the extent
expressly required to satisfy the requirements of Rule 15a-6 under the Exchange Act in respect
of the Options described hereunder. Agent shall have no authority to act as agent for Buyer
generally or with respect to transactions or other matters governed by this Agreement, except
to the extent expressly required to satisfy the requirements of Rule 15a-6 or in accordance
with express instructions from Buyer.

ISDA Master Agreement: 

With respect to the Agreement, Seller and Counterparty each agree as follows:

“Specified Entity” means in relation to Seller and in relation to Counterparty for purposes of this
Transaction: Not applicable.

The definition of “Specified Transaction” in Section 14 of this Agreement is hereby amended by
adding the text “commodity transaction, credit derivative transaction, repurchase or reverse
purchase transaction, securities lending transaction, futures transaction, prime brokerage or
margin lending transaction” after the words “foreign exchange transaction” in the sixth line
thereof and by replacing the words “any other similar transaction” in the eighth line thereof with
the text “any other transaction between the parties”. “Specified Transaction” shall exclude any
default

Confirmation OTC Convertible Note Hedge (amended)

- 12 -

 

under a Specified Transaction if caused solely by the general unavailability of the currency in
which payments under such Specified Transaction are denominated due to exchange controls or other
governmental action.

The “Cross Default” provisions of Section 5(a)(vi) of the Agreement will not apply to
Seller and will not apply to Counterparty.

The “Credit Event Upon Merger” provisions of Section 5(b)(iv) of the Agreement will not
apply to Seller and will not apply to Counterparty.

The “Automatic Early Termination” provision of Section 6(a) of the Agreement will not apply
to Seller or to Counterparty.

Payments on Early Termination. For the purpose of Section 6(e) of the Agreement: (i) Loss
shall apply; and (ii) the Second Method shall apply.

“Termination Currency” means USD.

Tax Representations.

	(a)	 	Payer Representations. For the purpose of Section 3(e) of the Agreement, each party
represents to the other party that it is not required by any applicable law, as modified by
the practice of any relevant governmental revenue authority, of any Relevant Jurisdiction to
make any deduction or withholding for or on account of any Tax from any payment (other than
interest under Section 2(e), 6(d)(ii), or 6(e) of the Agreement) to be made by it to the other
party under the Agreement. In making this representation, each party may rely on (i) the
accuracy of any representations made by the other party pursuant to Section 3(f) of the
Agreement, (ii) the satisfaction of the agreement contained in Section 4(a)(i) or 4(a)(iii) of
the Agreement, and the accuracy and effectiveness of any document provided by the other party
pursuant to Section 4(a)(i) or 4(a)(iii) of the Agreement, and (iii) the satisfaction of the
agreement of the other party contained in Section 4(d) of the Agreement; provided that it will
not be a breach of this representation where reliance is placed on clause (ii) above and the
other party does not deliver a form or document under Section 4(a)(iii) of the Agreement by
reason of material prejudice to its legal or commercial position.
	 
	(b)	 	Payee Representations. For the purpose of Section 3(f) of the Agreement, each party makes the
following representations to the other party:

(i) Dealer represents that it is a company organized under the laws of England and Wales.

(ii) Dealer represents that it is a “non-withholding foreign partnership” for United States
Federal income tax purposes and each partner of Dealer is a “non-U.S. branch of a foreign
person” for purposes of section 1.1441-4(a)(3)(ii) of the United States Treasury Regulations
and a “foreign person” for purposes of section 1.6041-4(a)(4) of the United States Treasury
Regulations.

(iii) Dealer represents that no partner of Dealer is (i) a bank that has entered into this
Agreement in the ordinary course of its trade or business of making loans, as described in
section 881(c)(3)(A) of the Internal Revenue Code of 1986, as amended (the “Code”), (ii) a
10% shareholder of Counterparty within the meaning of Code section 871(h)(3)(B), or (iii) a
controlled foreign corporation with respect to Counterparty within the meaning of Code
section 881(c)(3)(C).

(iv) Counterparty represents that it is a corporation incorporated in Oregon.

Delivery Requirements. For the purpose of Sections 4(a)(i) and (ii) of the
Agreement, each party agrees to deliver the following documents:

	(a)	 	Tax forms, documents or certificates to be delivered are:

Confirmation OTC Convertible Note Hedge (amended)

- 13 -

 

	 	 	Dealer agrees to complete (accurately and in a manner reasonably satisfactory to
Counterparty), execute, and deliver to Counterparty, United States Internal Revenue Service
Form W-8 IMY and all required attachments, or any successor of such form(s): (i) before the
first payment date under this agreement; (ii) promptly upon reasonable demand by
Counterparty; and (iii) promptly upon learning that any such Form previously provided by
Dealer has become obsolete or incorrect.
	 
	 	 	Counterparty agrees to complete (accurately and in a manner reasonably satisfactory to
Dealer), execute, and deliver to Dealer, United States Internal Revenue Service Form W-9 or
W-8 BEN, or any successor of such form(s): (i) before the first payment date under this
agreement; (ii) promptly upon reasonable demand by Dealer; and (iii) promptly upon learning
that any such form(s) previously provided by Counterparty has become obsolete or incorrect.
	 
	(b)	 	Other documents to be delivered:

	 	 	 	 	 	 	 
	 	 	 	 	 	 	Covered by
	Party Required to	 	 	 	 	 	Section 3(d)
	Deliver Document	 	Document Required to be Delivered	 	When Required	 	Representation
	Counterparty

	 	Evidence of the authority and
true signatures of each official
or representative signing this
Confirmation
	 	Upon or before
execution and
delivery of this
Confirmation
	 	Yes
	 
	 	 	 	 	 	 
	Counterparty

	 	Certified copy of the resolution
of the Board of Directors or
equivalent document authorizing
the execution and delivery of
this Confirmation and such other
certificates as Seller shall
reasonably request
	 	Upon or before
execution and
delivery of this
Confirmation
	 	Yes
	 
	 	 	 	 	 	 
	Seller

	 	Guarantee of its Credit Support
Provider, substantially in the
form of Exhibit A attached
hereto
	 	Upon or before
execution and
delivery of this
Confirmation
	 	No

Additional Notice Requirements. Counterparty hereby agrees to promptly deliver to Seller a copy of
all notices and other communications required or permitted to be given to the holders of any
Reference Notes pursuant to the terms of the Note Indenture on the dates so required or permitted
in the Note Indenture and all other notices given and other communications made by Counterparty in
respect of the Reference Notes to holders of any Reference Notes. Counterparty further covenants to
Seller that it shall promptly notify Seller of each Conversion Date, Amendment Event (including in
such notice a detailed description of any such amendment) and Repayment Event (identifying in such
notice the nature of such Repayment Event and the principal amount at maturity of Reference Notes
being paid).

Addresses for Notices. For the purpose of Section 12(a)
of the Agreement:

Address for notices or communications to
Seller for all purposes:

	 	 	 	 	 
	 

	 	Address:
	 	Merrill Lynch International
	 

	 	 	 	Merrill Lynch Financial Centre
	 

	 	 	 	2 King Edward Street
	 

	 	 	 	London EC1A 1HQ
	 
	 	 	 	 
	 

	 	Attention:
	 	Manager, Fixed Income Settlements
	 

	 	Facsimile No.:
	 	44 207 995 2004
	 

	 	Telephone No.:
	 	44 207 995 3769

Confirmation OTC Convertible Note Hedge (amended)

- 14 -

 

Additionally, a copy of all notices pursuant to Sections 5, 6, and 7 as
well as any changes to Counterparty’s address, telephone number or facsimile number should be sent
to:

	 	 	 	 	 
	 

	 	Address:
	 	GMI Counsel
	 

	 	 	 	Merrill Lynch World Headquarters
	 

	 	 	 	4 World Financial Center
	 

	 	 	 	New York, New York 10080
	 
	 	 	 	 
	 

	 	Attention:
	 	Global Equity Derivatives
	 

	 	Facsimile No.:
	 	212-449-6576
	 

	 	Telephone No.:
	 	212-449-6309

Address for notices or communications to Counterparty for all purposes:

	 	 	 	 	 
	 

	 	Address:
	 	14200 SW Karl Braun Drive
	 

	 	 	 	Beaverton, OR 97077
	 
	 	 	 	 
	 

	 	Attention:
	 	Treasurer
	 

	 	Facsimile No.:
	 	503-627-6108
	 

	 	Telephone No.:
	 	503-627-4622

In addition, in the case of notices or communications relating to Section 5, 6,
11 or 13 of this Agreement, a second copy of any such notice or communication shall
be addressed to the attention of Counterparty’ General Counsel as follows:

	 	 	 	 	 
	 

	 	Address:
	 	14200 SW Karl Braun Drive
	 

	 	 	 	Beaverton, OR 97077
	 
	 	 	 	 
	 

	 	Attention:
	 	General Counsel
	 

	 	Facsimile No.:
	 	503-627-7474
	 

	 	Telephone No.:
	 	503-627-6777

Process Agent. For the purpose of Section 13(c) of the Agreement, Seller appoints as its Process
Agent:

	 	 	 	 	 
	 

	 	Address:
	 	Merrill Lynch, Pierce, Fenner & Smith Incorporated
	 

	 	 	 	222 Broadway, 16th Floor
	 

	 	 	 	New York, New York 10038
	 
	 	 	 	 
	 

	 	Attention:
	 	Litigation Department
	 
	 	 	 	 
	 	 	Counterparty does not appoint a Process Agent.

	 	 	 
	Multibranch Party.

	 	For the purpose of
Section 10(c) of the Agreement: Neither Seller nor Counterparty is a Multibranch Party.
	 
	 	 
	Calculation Agent.

	 	“Calculation Agent” means Dealer, acting in good
faith and in a commercially reasonable manner.

Credit Support Document.

Seller: Guarantee of Merrill Lynch & Co., Inc. in the form attached hereto as
Exhibit A.

Counterparty: Not Applicable

Credit Support Provider.

Confirmation OTC Convertible Note Hedge (amended)

- 15 -

 

With respect to Seller: Merrill Lynch & Co., Inc.

With respect to Counterparty: Not Applicable.

Governing Law. This Confirmation will be governed by, and construed in accordance with, the laws of
the State of New York.

Submission to Jurisdiction. 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 the
Transaction to which it is a party, 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.

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 this
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 this Transaction, as applicable, by, among other
things, the mutual waivers and certifications provided herein.

Netting of Payments. The provisions of Section 2(c) of the Agreement shall not be
applicable to this Transaction.

Basic Representations. Section 3(a) of the Agreement is hereby amended by the deletion of
“and” at the end of Section 3(a)(iv); the substitution of a semicolon for the period at the
end of Section 3(a)(v) and the addition of Sections 3(a)(vi), as follows:

Eligible Contract Participant; Line of Business. Each party 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 (“CEA”), this Agreement and the Transaction thereunder are subject to individual
negotiation by the parties and have not been executed or traded on a “trading facility” as defined
in Section 1a(33) of the CEA, and it has entered into this Confirmation and this Transaction in
connection with its business or a line of business (including financial intermediation), or the
financing of its business.

Acknowledgements:

	(a)	 	The parties acknowledge and agree that there are no other representations, agreements or
other undertakings of the parties in relation to this Transaction, except as set forth in the
Agreement or this Confirmation.
	 
	(b)	 	The parties hereto intend for:

	 	(i)	 	Seller to be a “financial institution” as defined in Section 101(22) of Title
11 of the United States Code (the “Bankruptcy Code”) and this Transaction to be
a “securities contract” as defined in Section 741(7) of the Bankruptcy Code and a “swap
agreement” as defined in Section 101(53C) of the Bankruptcy Code, qualifying for the
protections of, among other sections, Sections 362(b)(6), 362 (b)(17), 546(e), 546(g),
555 and 560 of the Bankruptcy Code;
	 
	 	(ii)	 	a party’s right to liquidate this Transaction and to exercise any other
remedies upon the occurrence of any Event of Default under the Agreement with respect
to the other party to constitute a “contractual right” as defined in the Bankruptcy
Code;
	 
	 	(iii)	 	all payments for, under or in connection with this Transaction, all payments
for the Shares and the
transfer of such Shares to constitute “settlement payments” as defined in the
Bankruptcy Code.

Amendment of Section 6(d)(ii). Section 6(d)(ii) of the Agreement is modified by deleting
the words “on the day”

Confirmation OTC Convertible Note Hedge (amended)

- 16 -

 

in the second line thereof and substituting therefore “on the day that is three Local Business Days
after the day.” Section 6(d)(ii) is further modified by deleting the words “two Local
Business Days” in the fourth line thereof and substituting therefore “three Local Business Days.”

Consent to Recording. Each party consents to the recording of the telephone conversations of
trading and marketing personnel of the parties and their Affiliates in connection with this
Confirmation. To the extent that one party records telephone conversations (the “Recording Party”)
and the other party does not (the “Non-Recording  Party”), the Recording Party shall in the
event of any dispute, make a complete and unedited copy of such party’s tape of the entire day’s
conversations with the Non-Recording Party’s personnel available to the Non-Recording Party. The
Recording Party’s tapes may be used by either party in any forum in which a dispute is sought to be
resolved and the Recording Party will retain tapes for a consistent period of time in accordance
with the Recording Party’s policy unless one party notifies the other that a particular transaction
is under review and warrants further retention.

Disclosure. Each party hereby acknowledges and agrees that Seller has authorized Counterparty to
disclose this Transaction and any related hedging transaction between the parties if and to the
extent that Counterparty reasonably determines (after consultation with Seller) that such
disclosure is required by law or by the rules of the New York Stock Exchange or any securities
exchange. Notwithstanding the foregoing, effective from the date of commencement of discussions
concerning the Transaction, Counterparty and each of its employees, representatives, or other
agents may disclose to any and all persons, without limitation of any kind, the tax treatment and
tax structure of the Transaction and all materials of any kind (including opinions or other tax
analyses) that are provided to Counterparty relating to such tax treatment and tax structure.

Severability. If any term, provision, covenant or condition of this Confirmation, or the
application thereof to any party or circumstance, shall be held to be invalid or unenforceable in
whole or in part for any reason, the remaining terms, provisions, covenants, and conditions hereof
shall continue in full force and effect as if this Confirmation had been executed with the invalid
or unenforceable provision eliminated, so long as this Confirmation as so modified continues to
express, without material change, the original intentions of the parties as to the subject matter
of this Confirmation and the deletion of such portion of this Confirmation will not substantially
impair the respective benefits or expectations of parties to this Agreement; provided, however,
that this severability provision shall not be applicable if any provision of Section 2,
5, 6 or 13 of the Agreement (or any definition or provision in Section
14 to the extent that it relates to, or is used in or in connection with any such Section)
shall be so held to be invalid or unenforceable.

Affected Parties. For purposes of Section 6(e) of the Agreement, each party shall be deemed
to be an Affected Party in connection with Illegality and any Tax Event.

[Signatures follow on separate page]

Confirmation OTC Convertible Note Hedge (amended)

- 17 -

 

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

	 	 	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	MERRILL LYNCH INTERNATIONAL	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ RHONDA GARGUILO	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Rhonda Garguilo	 	 
	 	 	Title:	 	Vice President	 	 
	 	 	 	 	Structured Products Documentation	 	 

Confirmed as of the date first above written:

	 	 	 	 	 	 	 
	TEKTRONIX, INC.	 	 
	 
	 	 	 	 	 	 
	By:	 	/s/ JAMES F. DALTON	 	 
	 	 	 	 	 
	Name:	 	James F. Dalton	 	 
	Title:	 	Senior Vice President,	 	 
	 

	 	 	 	General Counsel, and Secretary	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 

Acknowledged and agreed as to matters to the Agent:

	 	 	 	 	 	 	 
	MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATE,	 	  
	Solely in its capacity as Agent hereunder	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	By:	 	/s/ ANGELINA LOPES	 	 
	 	 	 	 	 
	Name:	 	Angelina Lopes	 	 
	Title:	 	Derivatives Documentation	 	 

Confirmation
OTC Convertible Note Hedge (amended)

 

EXHIBIT A

GUARANTEE OF MERRILL LYNCH & CO., INC.

     FOR VALUE RECEIVED, receipt of which is hereby acknowledged, MERRILL LYNCH & CO., INC., a
corporation duly organized and existing under the laws of the State of Delaware (“ML & Co.”),
hereby unconditionally guarantees to Tektronix, Inc. (the “Company”), the due and punctual payment
of any and all amounts payable by Merrill Lynch International, a company organized under the laws
of England and Wales (“ML”), under the terms of the Confirmation of OTC Convertible Note Hedge
between the Company and ML (ML as Seller), amended and restated as of June 29, 2007 (the
“Confirmation”), including, in case of default, interest on any amount due, when and as the same
shall become due and payable, whether on the scheduled payment dates, at maturity, upon declaration
of termination or otherwise, according to the terms thereof. In case of the failure of ML
punctually to make any such payment, ML & Co. hereby agrees to make such payment, or cause such
payment to be made, promptly upon demand made by the Company to ML & Co.; provided, however that
delay by the Company in giving such demand shall in no event affect ML & Co.’s obligations under
this Guarantee. This Guarantee shall remain in full force and effect or shall be reinstated (as
the case may be) if at any time any payment guaranteed hereunder, in whole or in part, is rescinded
or must otherwise be returned by the Company upon the insolvency, bankruptcy or reorganization of
ML or otherwise, all as though such payment had not been made.

     ML & Co. hereby agrees that its obligations hereunder shall be unconditional, irrespective of
the validity, regularity or enforceability of the Confirmation; the absence of any action to
enforce the same; any waiver or consent by the Company concerning any provisions thereof; the
rendering of any judgment against ML or any action to enforce the same; or any other circumstances
that might otherwise constitute a legal or equitable discharge of a guarantor or a defense of a
guarantor. ML covenants that this guarantee will not be discharged except by complete payment of
the amounts payable under the Confirmation. This Guarantee shall continue to be effective if ML
merges or consolidates with or into another entity, loses its separate legal identity or ceases to
exist.

     ML & Co. hereby waives diligence; presentment; protest; notice of protest, acceleration, and
dishonor; filing of claims with a court in the event of insolvency or bankruptcy of ML; all demands
whatsoever, except as noted in the first paragraph hereof; and any right to require a proceeding
first against ML.

     ML & Co. hereby certifies and warrants that this Guarantee constitutes the valid obligation of
ML & Co. and complies with all applicable laws.

     This Guarantee shall be governed by, and construed in accordance with, the laws of the State
of New York.

     This Guarantee may be terminated at any time by notice by ML & Co. to the Company given in
accordance with the notice provisions of the Confirmation, effective upon receipt of such notice by
the Company or such later date as may be specified in such notice; provided, however, that this
Guarantee shall continue in full force and effect with respect to any obligation of ML under the
Confirmation.

     This Guarantee becomes effective concurrent with the effectiveness of the Confirmation,
according to its terms.

Confirmation OTC Convertible Note Hedge Guarantee (amended)

 

     IN WITNESS WHEREOF, ML & Co. has caused this Guarantee to be executed in its corporate
name by its duly authorized representative.

	 	 	 	 	 	 	 	 	 
	 	 	MERRILL LYNCH & CO., INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ JOAN E. TIMOLDI	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Joan E. Timoldi	 	 
	 	 	Title:	 	Designated Signatory	 	 
	 	 	Date:	 	June 28, 2007exv10w3

 

  

Exhibit 10.3

EXECUTION COPY

Confirmation of OTC Convertible Note Hedge

	 	 	 	 	 
	Date:	 	June 29, 2007
	 
	 	 	 	 
	To:	 	Tektronix, Inc. (“Counterparty”)
	 

	 	Attention:
	 	Treasurer
	 

	 	Telephone No.:
	 	503-627-4622
	 

	 	Facsimile No.:
	 	502-627-6108
	 
	 	 	 	 
	From:	 	Citibank, N.A. (“Dealer”)

Dealer Reference:

Dear Sir / Madam:

     The purpose of this letter agreement (this “Confirmation”) is to amend and restate the
terms and conditions of the above-referenced transaction entered into among Counterparty and Dealer
on the Trade Date specified below (the “Transaction”). This Confirmation amends, restates
and supersedes in its entirety the Confirmation in respect of the Transaction dated as of June 25,
2007. This Confirmation constitutes a “Confirmation” as referred to in the Agreement specified
below.

     The definitions and provisions contained in the 2000 ISDA Definitions (the “Swap
Definitions”) and the 2002 ISDA Equity Derivatives Definitions (the “Equity
Definitions” and, together with the Swap Definitions, the “Definitions”), in each case
as published by the International Swaps and Derivatives Association, Inc. are incorporated into
this Confirmation. In the event of any inconsistency between the Swap Definitions and the Equity
Definitions, the Equity Definitions will govern, and in the event of any inconsistency between the
Definitions and this Confirmation, this Confirmation will govern. References herein to a
“Transaction” shall be deemed to be references to a “Share Option Transaction” for purposes of the
Equity Definitions and a “Swap Transaction” for the purposes of the Swap Definitions.

     This Confirmation evidences a complete binding agreement between you and us as to the terms of
the Transaction to which this Confirmation relates. This Confirmation (notwithstanding anything to
the contrary herein), shall be subject to, and form part of, an agreement in the 1992 form of the
ISDA Master Agreement (Multicurrency Cross Border) (the “Master Agreement” or
“Agreement”) as if we had executed an agreement in such form (but without any Schedule and
with the elections specified in the “ISDA Master Agreement” Section of this Confirmation) on the
Trade Date. In the event of any inconsistency between the provisions of that Agreement and this
Confirmation, this Confirmation will prevail for the purpose of this Transaction. The parties
hereby agree that the Transaction evidenced by this Confirmation shall be the only Transaction
subject to and governed by the Agreement.

     The parties acknowledge that this Confirmation is entered into on the date hereof with the
understanding that the provisions of the Note Indenture (as defined below) that are referred to
herein will conform to the descriptions thereof in the Offering Memorandum dated June 25, 2007 (the
“Offering Memorandum”) relating to the Reference Notes (as defined below). The parties agree that
in the event of any inconsistency between the Note Indenture as of the Effective Date and the
Offering Memorandum, the parties will amend this Confirmation in good faith to preserve the intent
of the parties.

     The terms of the particular Transaction to which this Confirmation relates
are as follows:

 

 

     General Terms: 

	 	 	 
	Trade Date:

	 	June 25, 2007
	 
	 	 
	Effective Date:

	 	The date of issuance of the Reference Notes.
	 
	 	 
	Option Style:

	 	Modified American, as described in “Procedures for Exercise” below.
	 
	 	 
	Option Type:

	 	Call
	 
	 	 
	Seller:

	 	Dealer
	 
	 	 
	Buyer:

	 	Counterparty
	 
	 	 
	Shares:

	 	The shares of common stock, without par value, of
Counterparty (Security Symbol: “TEK”) or such other securities or
property into which the Reference Notes are convertible on the
date of determination.
	 
	 	 
	Premium:

	 	 $14,904,000.00
	 
	 	 
	Premium Payment Date:

	 	The Effective Date
	 
	 	 
	Exchange:

	 	New York Stock Exchange
	 
	 	 
	Related Exchange(s):

	 	All Exchanges
	 
	 	 
	Reference Notes:

	 	The 100% Senior Convertible Notes in denominations of USD 1,000
principal amount, original principal amount USD 345,000,000.
	 
	 	 
	Applicable Portion of the
Reference Notes:

	 	 20.00%. For the avoidance of doubt, the Calculation Agent shall,
as it deems necessary, take into account the Applicable Portion of
the Reference Notes in determining or calculating any delivery or
payment obligations hereunder, whether upon a Conversion Date (as
defined below) or otherwise.
	 
	 	 
	Note Indenture:

	 	The indenture, dated as of closing of the issuance of the
Reference Notes, between Counterparty and U.S. Bank National
Association, as trustee relating to the Reference Notes, as the
same may be amended, modified or supplemented from time to time;
provided that amendments, modifications or supplements adopted, or
waivers obtained, of the kind specified under “Amendment Event”
below and adopted or obtained, in each case, without Dealer’s
consent, shall not be deemed part of the Note Indenture for
purposes of this Confirmation. Certain defined terms used herein
have the meanings assigned to them in the Note Indenture.
	 
	 	 
	Procedures for Exercise:
	 	 
	 
	 	 
	Potential Exercise Dates:

	 	As specified below under “Exercise Notice”.
	 
	 	 
	Conversion Date:

	 	Each “conversion date” for any Reference Note pursuant to the
terms of the

Confirmation OTC Convertible Note Hedge (amended)

- 2 -

 

	 	 	 
	 

	 	Note Indenture occurring before the Expiration Date.
	 
	 	 
	 

	 	The principal amount of Reference Notes converted on each
Conversion Date shall be the “Conversion Amount” for such
Conversion Date.
	 
	 	 
	 

	 	If the Conversion Amount for any Conversion Date is less than the
aggregate principal amount of Reference Notes then outstanding,
then the terms of this Transaction shall continue to apply,
subject to the terms and conditions set forth herein, with respect
to the remaining outstanding principal amount of the Reference
Notes.
	 
	 	 
	Exercise Period:

	 	The period from and excluding the Effective Date to and including
the Expiration Date.
	 
	 	 
	Expiration Date:

	 	The earliest of (i) the Final Maturity Date (as defined in the
Note Indenture) of the Reference Notes, (ii) the first day on
which none of such Reference Notes remain outstanding, whether by
virtue of conversion, issuer repurchase or otherwise and (iii) the
occurrence of an Additional Termination Event and designation of
an Early Termination Date hereunder in respect of the termination
of the Transaction in whole but not in part.
	 
	 	 
	Exercise Notice:

	 	Notwithstanding anything to the contrary in the Equity
Definitions, in order to exercise any Options hereunder, Buyer
shall provide Seller with written notice (“Exercise Notice”)
prior to 5:00 p.m. New York City time on the Business Day prior
to the first Trading Day in the Conversion Reference Period (all
as defined in the Note Indenture) relating to the Reference Notes
converted on the relevant Conversion Date of (i) the number of
Reference Notes being converted on the relevant Conversion Date,
(ii) the first Trading Day in the relevant Conversion Reference
Period for the Reference Notes and (iii) the applicable Cash
Percentage (as defined in the Note Indenture), if any; provided
that with respect to Reference Notes converted during the period
beginning on May 15, 2012 and ending on the second Business Day
immediately preceding the Final Maturity Date (as defined in the
Note Indenture) of the Reference Notes, the related Exercise
Notice need not contain the information specified in clause (i) of
this sentence and, in order to exercise any Options hereunder,
Buyer shall deliver to Seller prior to 5:00 p.m. New York City
time on the Business Day (as defined in the Note Indenture) prior
to such Final Maturity Date a written notice (“Supplemental
Exercise Notice”) setting forth the number of Reference Notes
converted during such period; provided further that the delivery
by Buyer of an Exercise Notice after the Conversion Reference
Period has commenced but prior to the close of business on the
fifth Trading Day of such Conversion Reference Period shall be
effective, in which case the Settlement Method shall be Net Share
Settlement but without regard to subsection (ii) of the definition
of Net Share Settlement and subject to adjustments to the Net
Share Settlement Amount as specified below.
	 
	 	 
	Seller’s Telephone Number and
Telex and/or Facsimile Number
and Contact Details for purpose
of Giving Notice:

	 	Citibank, N.A.

250 West Street

10th Floor

New York, New York 10013

Attention: Director Derivatives Operations

Facsimile No.: 212 723 2956
	 
	 	 
	Settlement Terms:
	 	 
	 
	Settlement Method Election:

	 	Net Share Settlement or Net Cash Settlement consistent with Buyer’s election

Confirmation OTC Convertible Note Hedge (amended)

- 3 -

 

	 	 	 
	 

	 	with respect to the Reference Notes converted on
the applicable Conversion Date; provided that Net Share Settlement
shall apply in the event that Buyer elects to deliver any Shares
in connection with the applicable Conversion Date; and provided
further that it shall be a condition for Buyer’s right to elect
Net Cash Settlement or settlement pursuant to clause (ii) of Net
Share Settlement that Buyer delivers to Seller with the related
Exercise Notice a representation signed by Buyer that Buyer has
publicly disclosed all material information necessary for Buyer to
be able to purchase or sell Shares in compliance with applicable
securities laws.
	 
	 	 
	Electing Party:

	 	Buyer
	 
	 	 
	Settlement Date:

	 	Subject to the delivery of an Exercise Notice to the Seller, on
the third (3rd) Business Day (as defined in the Note Indenture)
following the final Trading Day (as defined in the Note Indenture)
in the applicable Conversion Reference Period in respect of the
relevant Conversion Date.
	 
	 	 
	Net Share Settlement:

	 	In lieu of the obligations set forth in Sections 8.1 and 9.1 of
the Equity Definitions, Seller shall deliver to Buyer on the
related Settlement Date (i) a number of Shares equal to the
related Net Share Settlement Amount, provided that in the event
that the number of Shares calculated comprises any fractional
Share, only whole Shares shall be delivered and an amount equal to
the value of such fractional Share shall be payable by Seller to
Buyer in cash and (ii) an amount in cash equal to(x) the cash
amount, if any, paid by Buyer in excess of the principal amount of
the applicable Reference Notes for such Conversion Date pursuant
to Section 4.12 of the Note Indenture multiplied by (y) the
Applicable Portion of the Reference Notes, provided that the
delivery obligation set forth in clause (i) and (ii) of this
paragraph shall be determined excluding any Shares or cash that
Counterparty is obligated to deliver to holders of the applicable
Reference Notes as a result of any adjustments to the Conversion
Rate resulting from (a) a discretionary adjustment to the
Conversion Rate by Counterparty or (b) an adjustment to the
Conversion Rate as a result of a fundamental change as described
in Section 4.01(i) of the Note Indenture. The provisions of
Sections 9.1(c), 9.8, 9.9, 9.10, 9.11 and 9.12 of the Equity
Definitions shall apply to any delivery of Shares hereunder,
provided that the Representation and Agreement 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 Buyer is the issuer of the Shares.
	 
	 	 
	Net Cash Settlement:

	 	In lieu of the obligations set forth in Section 8.1 of the Equity
Definitions, on the Settlement Date Seller shall deliver to Buyer
an amount in cash equal to the related Net Cash Settlement Amount.
	 
	 	 
	Net Share Settlement Amount:

	 	For each Conversion Date, the number of Shares equal to the Shares
delivered by Buyer for such Conversion Date as required under the
Note Indenture multiplied by the Applicable Portion of the
Reference Notes, provided that if an Exercise Notice with respect
to such Conversion Date has not been delivered to the Seller prior
to the first Trading Day of the Conversion Reference Period
applicable to such Conversion Date, the Net Share Settlement
Amount for such Conversion Date shall be adjusted by the
Calculation Agent to account for the consequences of the reduced
number of Trading Days from the delivery of the Exercise Notice to
the end of the applicable Conversion Reference Period with respect
to such Conversion Date. No reduction of the Net Share Settlement
Amount shall reduce the Net Share Settlement Amount below zero.

Confirmation OTC Convertible Note Hedge (amended)

- 4 -

 

	 	 	 
	Net Cash Settlement Amount:

	 	For each Conversion Date, an amount equal to the cash delivered by
the Buyer in excess of the principal amount of the applicable
Reference Notes for such Conversion Date pursuant to Section 4.12
of the Note Indenture multiplied by the Applicable Portion of the
Reference Notes, provided that such cash amount shall be
determined excluding any cash that Counterparty is obligated to
deliver to holders of the applicable Reference Notes as a result
of any adjustments to the Conversion Rate resulting from (i) a
discretionary adjustment to the Conversion Rate by Counterparty or
(ii) an adjustment to the Conversion Rate as a result of a
fundamental change as described in Section 4.01(i) of the Note
Indenture.
	 
	 	 
	Adjustments:
	 	 
	 
	 	 
	Method of Adjustment:

	 	Calculation Agent Adjustment; provided that the terms of this
Transaction shall be adjusted in a manner consistent with
adjustments of the Conversion Rate of the Reference Notes as
provided in the Note Indenture; provided further (without
limitation of the provisions set forth above under “Net Share
Settlement” and “Net Cash Settlement Amount”) that no adjustment
in respect of any Potential Adjustment Event or Extraordinary
Event shall be made hereunder as a result of any adjustments to
the Conversion Rate resulting from (i) a discretionary adjustment
to the Conversion Rate by Counterparty or (ii) an adjustment to
the Conversion Rate as a result of a fundamental change as
described in Section 4.01(i) of the Note Indenture.
	 
	 	 
	Potential Adjustment Event:

	 	Notwithstanding Section 11.2(e) of the Equity Definitions, a
“Potential Adjustment Event” means, subject to the preceding
paragraph, the occurrence of an event or condition that would
result in an adjustment of the Conversion Rate of the Reference
Notes pursuant to the Note Indenture.
	 
	 	 
	Extraordinary Events:
	 	 
	 
	 	 
	Merger Events:

	 	Notwithstanding Section 12.1(b) of the Equity Definitions, a
“Merger Event” means the occurrence of any event or condition to
which Section 4.10 of the Note Indenture applies.
	 
	 	 
	Consequences for Merger Events:
	 	 
	 
	 	 
	           Share-for-Share:

	 	The Transaction will be adjusted consistent with the Reference
Notes as provided in the Note Indenture.
	 
	 	 
	           Share-for-Other:

	 	The Transaction will be adjusted consistent with the Reference
Notes as provided in the Note Indenture.
	 
	 	 
	           Share-for-Combined:

	 	The Transaction will be adjusted consistent with the Reference
Notes as provided in the Note Indenture.
	 
	 	 
	Tender Offer:

	 	Applicable, subject to “Consequences of Tender Offers” below.
Notwithstanding Section 12.1(d) of the Equity Definitions, “Tender
Offer” means the occurrence of any event or condition set forth in
Section 4.06(e) of the Note Indenture.
	 
	 	 
	Consequences of Tender Offers:

	 	The Transaction will be adjusted consistent with the Reference
Notes as provided in the Note Indenture.

Confirmation OTC Convertible Note Hedge (amended)

- 5 -

 

	 	 	 
	Nationalization, Insolvency and
Delisting:

	 	Cancellation and Payment (Calculation Agent Determination),
provided Buyer shall determine whether payment shall be settled in
cash or Shares. In addition to the provisions of Section
12.6(a)(iii) of the Equity Definitions, it will 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 Market or the NASDAQ Global Select 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:
	 	 
	 
	 	 
	           Change in Law:

	 	Applicable
	 
	 	 
	           Failure to Deliver:

	 	Applicable. If there is inability in the market to deliver Shares
due to illiquidity on a day that would have been a Settlement
Date, then the Settlement Date shall be the first succeeding
Exchange Business Day on which there is no such inability to
deliver, but in no such event shall the Settlement Date be later
than the date that is two (2) Exchange Business Days immediately
following what would have been the Settlement Date but for such
inability to deliver.
	 
	 	 
	           Insolvency Filing:

	 	Applicable
	 
	 	 
	           Hedging Disruption:

	 	Applicable
	 
	 	 
	           Increased Cost of
Hedging:

	 	Not Applicable
	 
	 	 
	           Loss of Stock Borrow:

	 	Not Applicable
	 
	 	 
	           Increased Cost of
Stock Borrow:

	 	Not Applicable
	 
	 	 
	           Hedging Party:

	 	Seller
	 
	 	 
	           Determining Party:

	 	Seller
	 
	 	 
	Non-Reliance:

	 	Applicable
	 
	 	 
	Agreements and Acknowledgments
Regarding Hedging Activities:

	 	Applicable
	 
	 	 
	Additional Acknowledgments:

	 	Applicable

Additional Agreements, Representations and Covenants of Buyer, Etc.:

	1.	 	Buyer hereby represents and warrants to Seller, on each day from the Trade Date to and including the

Confirmation OTC Convertible Note Hedge (amended)

- 6 -

 

	 	 	earlier of (i) July 27, 2007 and (ii) the date by which Seller is able to initially complete
a hedge of its position relating to this Transaction, that:

	 	a.	 	it will effect (and cause any “affiliated purchaser” (as defined in Rule 10b-18
promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange
Act”)) to effect) any purchases, direct or indirect (including by means of any
cash-settled or other derivative instrument), of Shares or any security convertible
into or exchangeable or exercisable for Shares solely through Dealer in a manner that
would not cause any purchases by Seller of its hedge in connection with this
Transaction not to comply with applicable securities laws;
	 
	 	b.	 	it will not engage in, or be engaged in, any “distribution,” as such term is
defined in Regulation M promulgated under the Exchange Act, other than a distribution
meeting the requirements of the exceptions set forth in sections 101(b)(10) and
102(b)(7) of Regulation M (it being understood that Buyer makes no representation
pursuant to this clause in respect of any action or inaction taken by Seller or any
initial purchaser of the Reference Notes); and
	 
	 	c.	 	Buyer has publicly disclosed all material information necessary for Buyer to be
able to purchase or sell Shares in compliance with applicable federal securities laws.

	2.	 	If Buyer would be obligated to pay cash (other than payment of the Premium) to, or receive
cash from, Seller pursuant to the terms of this Agreement for any reason without having had
the right (other than pursuant to this paragraph (2)) to elect to deliver or receive Shares in
satisfaction of such payment obligation, then Buyer may elect (by giving notice to Seller no
later than 8 a.m. New York time on the Exchange Business Day immediately following the date
of occurrence of the event giving rise to such payment obligation) that such payment
obligation shall be satisfied by the delivery of a number of Shares (or, if the Shares have
been converted into other securities or property in connection with an Extraordinary Event, a
number or amount of such other securities or property as a holder of Shares would be entitled
to receive upon the consummation or closing of such Extraordinary Event) having a cash value
equal to the amount of such payment obligation. Such number or amount of Shares or other
securities or property to be delivered shall be determined by the Calculation Agent to be the
number of Shares or number or amount of such other securities or property that could be
purchased or sold, as applicable, over a reasonable period of time with the cash equivalent of
such payment obligation). Settlement relating to any delivery of Shares or other securities
or property pursuant to this paragraph (2) shall occur within a reasonable period of time.
Notwithstanding anything herein or in the Agreement to the contrary, the aggregate number of
Shares that Counterparty may be required to deliver to Dealer under this Transaction shall not
exceed 2,603,418 Shares, as adjusted by the Calculation Agent to account for any subdivision,
stock-split, stock combination, reclassification, certain distributions, dividends and
payments to holders of Buyer’s common stock or similar dilutive or anti-dilutive events with
respect to the Shares.
	 
	3.	 	Notwithstanding any provision in the Note Indenture, this Confirmation or the Agreement to
the contrary, each of the “Applicable Conversion Rate” (as such term is defined in the Note
Indenture), the Shares and cash amounts owed pursuant to Net Share Settlement, the Net Cash
Settlement Amount and any other amount hereunder determined by reference to the Applicable
Conversion Rate shall be determined without regard to any provisions in the Note Indenture
allowing Counterparty to unilaterally increase the “Applicable Conversion Rate” or any
adjustments resulting from a fundamental change.
	 
	4.	 	Counterparty is not, and after giving effect to the Transaction contemplated hereby, will not
be, an “investment company” as such term is defined in the Investment Company Act of 1940, as
amended.
	 
	5.	 	As of the Trade Date and each date on which a payment or delivery is made by Counterparty
hereunder, (i) the assets of Counterparty at their fair valuation exceed the liabilities of
Counterparty, including contingent liabilities; (ii) the capital of Counterparty is adequate
to conduct its business; and (iii) Counterparty has the ability to pay its debts and other
obligations as such obligations mature and does not intend to, or believe that it will, incur
debt or other obligations beyond its ability to pay as such obligations mature.

Confirmation OTC Convertible Note Hedge (amended)

- 7 -

 

	6.	 	The representations and warranties set forth in Section 1 of the Purchase Agreement (as
defined below) are hereby deemed to be repeated to Dealer as if set forth herein.

Additional Termination Events: 

The occurrence of any of the following shall be an Additional Termination Event for purposes of
this Transaction:

	1.	 	Amendment Event. If an Amendment Event (as defined below) occurs, Dealer shall have the
right to designate an Early Termination Date pursuant to Section 6(b) of the Agreement and,
notwithstanding anything to the contrary herein, no payments shall be required hereunder in
connection with such Amendment Event.
	 
	 	 	“Amendment Event” means that the Counterparty, without Dealer’s consent, amends,
modifies, supplements or obtains a waiver of (a) any term of the Note Indenture (as in
effect prior to such amendment, modification, supplement or waiver) or the Reference Notes
relating to the principal amount, coupon, maturity, repurchase obligation of the
Counterparty or redemption right of the Counterparty, (b) any term relating to conversion of
the Reference Notes, including, without limitation, any changes to the conversion price,
conversion settlement dates or conversion conditions or (c) any term that would require
consent of the holders of 100% of the principal amount of the Reference Notes to amend;
provided, for the avoidance of doubt, that an adjustment to the Conversion Rate in
accordance with the terms of the Note Indenture (as in effect prior to any amendment,
modification, supplement or waiver to which Dealer has not given its consent) shall not
constitute an Amendment Event;
	 
	2.	 	Repayment Event. If a Repayment Event (as defined below) occurs, Dealer shall have the right
to designate an Early Termination Date pursuant to Section 6(b) of the Agreement with respect
to this Transaction only to the extent of the principal amount of Reference Notes that cease
to be outstanding as a result of such Repayment Event and, notwithstanding anything to the
contrary herein, no payments shall be required hereunder in connection with such Repayment
Event.
	 
	 	 	“Repayment Event” means that (a) any Reference Notes are repurchased (whether in
connection with or as a result of a fundamental change or change of control, howsoever
defined, or for any other reason) by the Counterparty, (b) any Reference Notes are delivered
to the Counterparty in exchange for delivery of any property or assets of the Counterparty
or any of its subsidiaries (howsoever described), other than as a result of and in
connection with a Conversion Date, (c) any principal of any of the Reference Notes is repaid
prior to the Final Maturity Date (as defined in the Note Indenture) (whether following
acceleration of the Reference Notes or otherwise), provided that no payments of cash made in
respect of the conversion of a Reference Note shall be deemed a payment of principal under
this clause (c), (d) any Reference Notes are exchanged by or for the benefit of the holders
thereof for any other securities of the Counterparty or any of its Affiliates (or any other
property, or any combination thereof) pursuant to any exchange offer or similar transaction
or (e) any of the Reference Notes is surrendered by Counterparty to the trustee for
cancellation, other than registration of a transfer of such Reference Notes or as a result
of and in connection with a Conversion Date; provided, for the avoidance of doubt, that a
conversion of the Reference Notes pursuant to the Note Indenture shall not constitute a
Repayment Event.
	 
	3.	 	Initial Purchase Event. If an Initial Purchase Event (as defined below) occurs, this
Transaction shall terminate automatically in its entirety and, notwithstanding anything to the
contrary herein, only the payments specified below shall be required hereunder in connection
with such Initial Purchase Event.
	 
	 	 	“Initial Purchase Event” means that the transactions contemplated by the Purchase
Agreement among the Counterparty, Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Goldman, Sachs & Co. and Citigroup Global Markets Inc., dated as of June 25, 2007 (the
“Purchase Agreement”) shall fail to close for any reason by the closing date for the
offering of the Reference Notes as specified in the Purchase Agreement.

Confirmation OTC Convertible Note Hedge (amended)

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	 	 	If an Initial Purchase Event occurs for any reason other than a breach of the Purchase
Agreement by the Initial Purchaser, then all payments previously made hereunder shall be
returned to the person making such payment, including the Premium (if paid), less an amount
equal the product of (a) 1,735,612 Shares, (b) 0.50 and (c) an amount equal to the excess,
if any, of the closing price of the Shares on the Trade Date over the closing price of the
Shares on the date of the Initial Purchase Event (the “Break Expense”); provided
that any negative amount shall be replaced by zero and provided further that to the extent
the Premium has not been paid, Buyer shall promptly pay Seller the Break Expense. Seller and
Buyer agree that actual damages would be difficult to ascertain under these circumstances
and that the amount of liquidated damages resulting from the determination in the preceding
sentence is a good faith estimate of such damages and not a penalty.
	 
	 	 	If an Initial Purchase Event occurs due to a breach of the Purchase Agreement by the Initial
Purchaser, then all payments previously made hereunder, including the Premium, promptly
shall be returned to the person making such payment and no payments shall be required
hereunder in connection with such Initial Purchase Event.

Staggered Settlement: 

If Seller determines reasonably and in good faith that the number of Shares required to be
delivered to Buyer hereunder on any Settlement Date would exceed 8.0% of all outstanding Shares,
then Seller may, by notice to Buyer on or prior to such Settlement Date (a “Nominal Settlement
Date”), elect to deliver the Shares owed by it pursuant to Net Share Settlement (the “Share
Delivery Obligation”) on two or more dates (each, a “Staggered Settlement Date”) or at
two or more times on the Nominal Settlement Date as follows:

	1.	 	in such notice, Seller will specify to Buyer the related Staggered Settlement Dates (the
first of which will be such Nominal Settlement Date and the last of which will be no later
than twenty (20) Trading Days following such Nominal Settlement Date) or delivery times and
how it will allocate the Shares it is required to deliver hereunder among the Staggered
Settlement Dates or delivery times;
	 
	2.	 	the aggregate number of Shares that Seller will deliver to Buyer hereunder on all such
Staggered Settlement Dates or delivery times will equal the number of Shares that Seller would
otherwise be required to deliver on such Nominal Settlement Date; and
	 
	3.	 	the Net Share Settlement terms will apply on each Staggered Settlement Date, except that the
Shares comprising such Share Delivery Obligation will be allocated among such Staggered
Settlement Dates or delivery times as specified by Seller in the notice referred to in clause
(1) above.

Notwithstanding anything herein to the contrary, solely in connection with a Staggered Settlement
Date, Seller shall be entitled to deliver Shares to Buyer from time to time prior to the date on
which Seller would be obligated to deliver them to Buyer pursuant to Net Share Settlement terms set
forth above, and Buyer agrees to credit all such early deliveries against Seller’s obligations
hereunder in the direct order in which such obligations arise. No such early delivery of Shares
will accelerate or otherwise affect any of Buyer’s obligations to Seller hereunder.

Disposition of Hedge Shares: 

Counterparty hereby agrees that if, in the reasonable and good faith judgment of Seller based on
the advice of nationally recognized outside counsel, the Shares acquired by Seller for the purpose
of hedging its obligations pursuant to the Transaction (the “Hedge Shares”) cannot be sold
in the U.S. public market by Seller without registration under the Securities Act of 1933, as
amended (the “Securities Act”), Counterparty shall, at its election: (i) in order to allow
Seller to sell the Hedge Shares in a registered offering, make available to Seller an effective
registration statement under the Securities Act to cover the resale of such Hedge Shares and (a)
enter into an agreement, in form and substance satisfactory to Seller, substantially in the form of
an underwriting agreement for a registered offering, (b) provide accountant’s “comfort” letters in
customary form for registered offerings of equity securities, (c) provide disclosure opinions of
nationally recognized outside counsel to Counterparty

Confirmation OTC Convertible Note Hedge (amended)

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reasonably acceptable to Seller, (d) provide other customary opinions, certificates and closing
documents customary in form for registered offerings of equity securities and (e) afford Seller a
reasonable opportunity to conduct a “due diligence” investigation with respect to Counterparty
customary in scope for underwritten offerings of equity securities; provided, however, that if
Seller, in its sole reasonable discretion, is not satisfied with access to due diligence materials,
the results of its due diligence investigation, or the procedures and documentation for the
registered offering referred to above, then clause (ii) or clause (iii) of this Section shall apply
at the election of Counterparty; (ii) in order to allow Seller to sell the Hedge Shares in a
private placement, enter into a private placement agreement substantially similar to private
placement purchase agreements customary for private placements of equity securities, in form and
substance satisfactory to Seller, including customary representations, covenants, blue sky and
other governmental filings and/or registrations, indemnities to Seller, due diligence rights (for
Seller or any designated buyer of the Hedge Shares from Seller), opinions and certificates and such
other documentation as is customary for private placements agreements, all reasonably acceptable to
Seller (in which case, the Calculation Agent shall make any adjustments to the terms of the
Transaction that are necessary to compensate Seller for any discount from the public market price
of the Shares incurred on the sale of Hedge Shares in a private placement); or (iii) purchase the
Hedge Shares from Seller at the VWAP Price on such Exchange Business Days, and in the amounts,
requested by Seller. “VWAP Price” means, on any Exchange Business Day, the per Share
volume-weighted average price as displayed under the heading “Bloomberg VWAP” on Bloomberg page
TEK.N <equity> VAP (or any successor thereto) in respect of the period from 9:30 a.m. to 4:00
p.m. (New York City time) on such Exchange Business Day (or if such volume-weighted average price
is unavailable, the market value of one Share on such Exchange Business Day, as determined by the
Calculation Agent using a volume-weighted method).

Repurchase Notices: 

Counterparty shall, on any day on which Counterparty effects any repurchase of Shares, promptly
give Seller a written notice of such repurchase (a “Repurchase Notice”) on such day if
following such repurchase, the Notice Percentage as determined on such day is (i) greater than 6%
and (ii) greater by 0.5% than the Notice Percentage included in the immediately preceding
Repurchase Notice (or, in the case of the first such Repurchase Notice, greater than the Notice
Percentage as of the date hereof). In the event that Counterparty fails to provide Seller with a
Repurchase Notice on the day and in the manner specified in this section, then Counterparty agrees
to indemnify and hold harmless Seller, its affiliates and their respective directors, officers,
employees, agents and controlling persons (Seller and each such person being an “Indemnified
Party”) from and against any and all losses, claims, damages and liabilities (or actions in
respect thereof), joint or several, to which such Indemnified Party may become subject under
applicable securities laws, including without limitation, Section 16 of the Exchange Act, relating
to or arising out of such failure. If for any reason the foregoing indemnification is unavailable
to any Indemnified Party or insufficient to hold harmless any Indemnified Party, then Counterparty
shall contribute, to the maximum extent permitted by law, to the amount paid or payable by the
Indemnified Party as a result of such loss, claim, damage or liability. In addition, Counterparty
will reimburse any Indemnified Party for all reasonable and documented expenses (including
reasonable counsel fees and expenses) as they are incurred (after notice to Counterparty) in
connection with the investigation of, preparation for or defense or settlement of any pending or
threatened claim or any action, suit or proceeding arising therefrom, whether or not such
Indemnified Party is a party thereto and whether or not such claim, action, suit or proceeding is
initiated or brought by or on behalf of Counterparty. This indemnity shall survive the completion
of the Transaction contemplated by this Confirmation and any assignment and delegation of the
Transaction made pursuant to this Confirmation or the Agreement shall inure to the benefit of any
permitted assignee of Seller. Counterparty will not be liable under this Indemnity provision to
the extent that any loss, claim, damage, liability or expense is found in a final judgment by a
court to have resulted from Dealer’s gross negligence or willful misconduct. The “Notice
Percentage” as of any day is the fraction, expressed as a percentage, (i) the numerator of
which is the product of (a) the Applicable Portion of the Reference Notes, (b) the number of
outstanding Reference Notes and (c) a number of Shares per Reference Note equal to the Conversion
Rate (as defined in the Note Indenture) and (ii) the denominator of which is the number of Shares
outstanding on such day.

Conversion Rate Adjustment Notices

In connection with any adjustments to the Conversion Rate under the terms of the Note Indenture,
Counterparty

Confirmation OTC Convertible Note Hedge (amended)

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shall provide to Dealer a copy of the notice of adjustment required to be delivered to the Trustee
pursuant to Section 4.08 of the Note Indenture concurrently with filing of such notice with the
Trustee.

	 	 	 
	Compliance with 

Securities Laws:

	 	Each party acknowledges that the offer and sale of
the Transaction to it is intended to be exempt from
registration under the Securities Act by virtue of
Section 4(2) thereof. Accordingly, Buyer represents
and warrants to Seller 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 and (iii) the
disposition of the Transaction is restricted under
this Confirmation, the Securities Act and state
securities laws.
	 
	 	 
	 

	 	Buyer further represents:
	 
	 	 
	 

	 	(a) Buyer is not entering into this Transaction 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);
	 
	 	 
	 

	 	(b) Buyer acknowledges that as of the date hereof
and without limiting the generality of Section 13.1
of the Equity Definitions, Seller is not making any
representations or warranties with respect to the
treatment of the Transaction under FASB Statements
149 or 150, EITF Issue No. 00-19 (or any successor
issue statements) or under FASB’s Liabilities &
Equity Project.
	 
	 	 
	Account Details:

	 	Account for payments to Buyer:      To be advised
	 
	 	 
	 

	 	Account for payment to Seller:
	 
	 	 
	 

	 	Citibank N.A., New York
	 

	 	Swift Code: CITIUS33 ABA: 021000089
	 

	 	A/C 00167679
	 
	 	 
	 

	 	Accounts for deliveries of Shares: To be advised
	 
	 	 
	Bankruptcy Rights:

	 	In the event of Buyer’s bankruptcy, Seller’s rights
in connection with this Transaction shall not exceed
those rights held by common shareholders. For the
avoidance of doubt, the parties acknowledge and
agree that Seller’s rights with respect to any other
claim arising from this Transaction prior to Buyer’s
bankruptcy shall remain in full force and effect and
shall not be otherwise abridged or modified in
connection herewith.
	 
	 	 
	Set-Off:

	 	Each party waives any and all rights it may have to
set-off, whether arising under any agreement,
applicable law or otherwise.
	 
	 	 
	Collateral:

	 	None.
	 
	 	 
	Transfer:

	 	Buyer shall have the right to assign its rights and
delegate its obligations hereunder with respect to
any portion of this Transaction, subject to Seller’s
consent, such consent not to be unreasonably
withheld; provided that such assignment or transfer
shall be subject to receipt by Seller of opinions
and documents reasonably satisfactory to Seller and
effected on terms

Confirmation OTC Convertible Note Hedge (amended)

- 11 -

 

	 	 	 
	 

	 	reasonably satisfactory to the
Seller with respect to any legal and regulatory
requirements relevant to the Seller; provided
further that Buyer shall not be released from its
obligation to deliver any Exercise Notice or its
obligations pursuant to “Disposition of Hedge
Shares”, “Repurchase Notices” or “Conversion Rate
Adjustment Notices” above.
	 
	 	 
	 

	 	If, as determined in Seller’s sole discretion, the
“beneficial ownership” of it and those of its
affiliates which are subject to aggregation (within
the meaning of Section 13 of the Exchange Act and
rules promulgated thereunder) could be deemed to
exceed 8% of Counterparty’s outstanding Shares,
Seller may, without Counterparty’s consent, transfer
or assign all or any part of its rights or
obligations under this Transaction to reduce such
“beneficial ownership” to 7.5% to any third party
with a rating for its (or, if applicable, its Credit
Support Provider’s) long term, unsecured and
unsubordinated indebtedness of AA or better by
Standard & Poor’s Ratings Service or its successor
(“S&P”), or Aa3 or better by Moody’s Investors
Service (“Moody’s”) or, if either S&P or Moody’s
ceases to rate such debt, at least an equivalent
rating or better by a substitute rating agency
mutually agreed by Company and Seller. If after
Seller’s commercially reasonable efforts, Seller is
unable to effect such a transfer or assignment on
pricing terms reasonably acceptable to Seller and
within a time period reasonably acceptable to Seller
of a sufficient number of Options to reduce Seller’s
“beneficial ownership” (within the meaning of
Section 13 of the Exchange Act and rules promulgated
thereunder) to 7.5% of Counterparty’s outstanding
Shares or less, Seller may designate any Exchange
Business Day as an Early Termination Date with
respect to a portion (the “Terminated Portion”) of
this Transaction, such that its “beneficial
ownership” following such partial termination will
be equal to or less than 7.5%. In the event that
Seller so designates an Early Termination Date with
respect to a portion of this Transaction, a payment
shall be made pursuant to Section 6 of the Agreement
as if (i) an Early Termination Date had been
designated in respect of a Transaction having terms
identical to this Transaction and a Number of
Options equal to the Terminated Portion, (ii)
Counterparty shall be the sole Affected Party with
respect to such partial termination and (iii) such
Transaction shall be the only Terminated
Transaction. In circumstances in which the foregoing
provisions relating to Seller’s right to transfer or
assign its rights or obligations under the
Transaction are not applicable, Seller may transfer
any of its rights or delegate its obligations under
this Transaction with the prior written consent of
Buyer, which consent shall not be unreasonably
withheld.
	 
	 	 
	 

	 	Notwithstanding any provision of the Agreement to
the contrary, Seller shall be entitled to assign its
rights and obligations hereunder to make or receive
cash payments and transfer of Shares and other
related rights to one or more entities that are
wholly-owned, directly or indirectly, by Citigroup
Inc., or any successor thereto (each, a “Citibank
Affiliate”); provided that Buyer shall have recourse
to Seller in the event of the failure by a Citibank
Affiliate to perform any of such obligations
hereunder. Notwithstanding the foregoing, recourse
to Seller shall be limited to recoupment of Buyer’s
monetary damages and Buyer hereby waives any right
to seek specific performance by Seller of its
obligations hereunder. Such failure after any
applicable grace period shall be an Additional
Termination Event with the Transaction to which the
failure relates as the sole Affected Transaction and
Seller as the sole Affected Party.

ISDA Master Agreement: 

With respect to the Agreement, Seller and Counterparty each agree as follows:

“Specified Entity” means in relation to Seller and in relation to Counterparty for purposes of this
Transaction: Not applicable.

Confirmation OTC Convertible Note Hedge (amended)

- 12 -

 

The definition of “Specified Transaction” in Section 14 of this Agreement is hereby amended by
adding the text “commodity transaction, credit derivative transaction, repurchase or reverse
purchase transaction, securities lending transaction, futures transaction, prime brokerage or
margin lending transaction” after the words “foreign exchange transaction” in the sixth line
thereof and by replacing the words “any other similar transaction” in the eighth line thereof with
the text “any other transaction between the parties”. “Specified Transaction” shall exclude any
default under a Specified Transaction if caused solely by the general unavailability of the
currency in which payments under such Specified Transaction are denominated due to exchange
controls or other governmental action.

The “Cross Default” provisions of Section 5(a)(vi) of the Agreement will not apply to
Seller and will not apply to Counterparty.

The “Credit Event Upon Merger” provisions of Section 5(b)(iv) of the Agreement will not
apply to Seller and will not apply to Counterparty.

The “Automatic Early Termination” provision of Section 6(a) of the Agreement will not apply
to Seller or to Counterparty.

Payments on Early Termination. For the purpose of Section 6(e) of the Agreement: (i) Loss
shall apply; and (ii) the Second Method shall apply.

“Termination Currency” means USD.

Tax Representations.

	(a)	 	Payer Representations. For the purpose of Section 3(e) of the Agreement, each party
represents to the other party that it is not required by any applicable law, as modified by
the practice of any relevant governmental revenue authority, of any Relevant Jurisdiction to
make any deduction or withholding for or on account of any Tax from any payment (other than
interest under Section 2(e), 6(d)(ii), or 6(e) of the Agreement) to be made by it to the other
party under the Agreement. In making this representation, each party may rely on (i) the
accuracy of any representations made by the other party pursuant to Section 3(f) of the
Agreement, (ii) the satisfaction of the agreement contained in Section 4(a)(i) or 4(a)(iii) of
the Agreement, and the accuracy and effectiveness of any document provided by the other party
pursuant to Section 4(a)(i) or 4(a)(iii) of the Agreement, and (iii) the satisfaction of the
agreement of the other party contained in Section 4(d) of the Agreement; provided that it will
not be a breach of this representation where reliance is placed on clause (ii) above and the
other party does not deliver a form or document under Section 4(a)(iii) of the Agreement by
reason of material prejudice to its legal or commercial position.
	 
	(b)	 	Payee Representations. For the purpose of Section 3(f) of the Agreement, each party makes
the following representations to the other party:

(i) It is a national banking association organized under the laws of the United States and
its U.S. taxpayer identification number is 13-5266470. It is “exempt” within the meaning of
Treasury Regulation sections 1.6041-3(p) and 1.6049-4(c) from information reporting on Form
1099 and backup withholding.

(ii) Counterparty represents that it is a corporation incorporated in Oregon.

Delivery Requirements. For the purpose of Sections 4(a)(i) and (ii) of the
Agreement, each party agrees to deliver the following documents:

	(a)	 	Tax forms, documents or certificates to be delivered are:
	 
	 	 	Dealer agrees to complete (accurately and in a manner reasonably satisfactory to
Counterparty), execute,

Confirmation OTC Convertible Note Hedge (amended)

- 13 -

 

	 	 	and deliver to Counterparty, United States Internal Revenue Service Form W-8 IMY and all
required attachments, or any successor of such form(s): (i) before the first payment date
under this agreement; (ii) promptly upon reasonable demand by Counterparty; and (iii)
promptly upon learning that any such Form previously provided by Dealer has become obsolete
or incorrect.
	 
	 	 	Counterparty agrees to complete (accurately and in a manner reasonably satisfactory to
Dealer), execute, and deliver to Dealer, United States Internal Revenue Service Form W-9 or
W-8 BEN, or any successor of such form(s): (i) before the first payment date under this
agreement; (ii) promptly upon reasonable demand by Dealer; and (iii) promptly upon learning
that any such form(s) previously provided by Counterparty has become obsolete or incorrect.
	 
	(b)	 	Other documents to be delivered:

	 	 	 	 	 	 	 
	 	 	 	 	 	 	Covered by
	Party Required to	 	 	 	 	 	Section 3(d)
	Deliver Document	 	Document Required to be Delivered	 	When Required	 	Representation
	Counterparty

	 	Evidence of the authority and
true signatures of each official
or representative signing this
Confirmation
	 	Upon or before
execution and
delivery of this
Confirmation
	 	Yes
	 
	 	 	 	 	 	 
	Counterparty

	 	Certified copy of the resolution
of the Board of Directors or
equivalent document authorizing
the execution and delivery of
this Confirmation and such other
certificates as Seller shall
reasonably request
	 	Upon or before
execution and
delivery of this
Confirmation
	 	Yes

Additional Notice Requirements. Counterparty hereby agrees to promptly deliver to Seller a copy of
all notices and other communications required or permitted to be given to the holders of any
Reference Notes pursuant to the terms of the Note Indenture on the dates so required or permitted
in the Note Indenture and all other notices given and other communications made by Counterparty in
respect of the Reference Notes to holders of any Reference Notes. Counterparty further covenants
to Seller that it shall promptly notify Seller of each Conversion Date, Amendment Event (including
in such notice a detailed description of any such amendment) and Repayment Event (identifying in
such notice the nature of such Repayment Event and the principal amount at maturity of Reference
Notes being paid).

Addresses for Notices. For the purpose of Section 12(a)
of the Agreement:

Address for notices or communications to
Seller for all purposes:

	 	 	 	 	 
	 

	 	Address:
	 	Citibank
	 

	 	 	 	250 West Street
	 

	 	 	 	10th Floor
	 

	 	 	 	New York, New York 10013
	 

	 	Attention:
	 	Director Derivatives Operations
	 

	 	Facsimile No.:
	 	212-723-2956

Additionally, a copy of all notices pursuant to Sections 5, 6, and 7 as
well as any changes to Counterparty’s address, telephone number or facsimile number should be sent
to:

	 	 	 	 	 
	 

	 	Address:
	 	Legal Department
	 

	 	 	 	77 Water Street
	 

	 	 	 	9th Floor
	 

	 	 	 	New York, New York 10004

Confirmation OTC Convertible Note Hedge (amended)

- 14 -

 

	 	 	 	 	 
	 

	 	Attention:
	 	Department Head
	 

	 	Facsimile No.:
	 	212-657-1452

Address for notices or communications to Counterparty for all purposes:

	 	 	 	 	 
	 

	 	Address:
	 	14200 SW Karl Braun Drive
	 

	 	 	 	Beaverton, OR 97077
	 

	 	Attention:
	 	Treasurer
	 

	 	Facsimile No.:
	 	503-627-6108
	 

	 	Telephone No.:
	 	503-627-4622

In addition, in the case of notices or communications relating to Section 5, 6,
11 or 13 of this Agreement, a second copy of any such notice or communication shall
be addressed to the attention of Counterparty’ General Counsel as follows:

	 	 	 	 	 
	 

	 	Address:
	 	14200 SW Karl Braun Drive
	 

	 	 	 	Beaverton, OR 97077
	 

	 	Attention:
	 	General Counsel
	 

	 	Facsimile No.:
	 	503-627-7474
	 

	 	Telephone No.:
	 	503-627-6777

	 	 	 
	Multibranch Party.

	 	For the purpose of Section 10(c) of the Agreement: Neither Seller nor Counterparty is a Multibranch
Party.
	 
	 	 
	Calculation Agent.

	 	“Calculation Agent” means Dealer, acting in good faith and in a commercially reasonable manner.

Credit Support Document.

Seller: Not Applicable

Counterparty: Not Applicable

Credit Support Provider.

With respect to Seller: Not Applicable

With respect to Counterparty: Not Applicable.

Governing Law. This Confirmation will be governed by, and construed in accordance with, the laws of
the State of New York.

Submission to Jurisdiction. 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 the
Transaction to which it is a party, 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.

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 this
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)

Confirmation OTC Convertible Note Hedge (amended)

- 15 -

 

acknowledges that it and the other party have been induced to enter into this Transaction, as
applicable, by, among other things, the mutual waivers and certifications provided herein.

Netting of Payments. The provisions of Section 2(c) of the Agreement shall not be
applicable to this Transaction.

Basic Representations. Section 3(a) of the Agreement is hereby amended by the deletion of
“and” at the end of Section 3(a)(iv); the substitution of a semicolon for the period at the
end of Section 3(a)(v) and the addition of Sections 3(a)(vi), as follows:

Eligible Contract Participant; Line of Business. Each party 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 (“CEA”), this Agreement and the Transaction thereunder are subject to individual
negotiation by the parties and have not been executed or traded on a “trading facility” as defined
in Section 1a(33) of the CEA, and it has entered into this Confirmation and this Transaction in
connection with its business or a line of business (including financial intermediation), or the
financing of its business.

Acknowledgements:

	(a)	 	The parties acknowledge and agree that there are no other representations, agreements or
other undertakings of the parties in relation to this Transaction, except as set forth in the
Agreement or this Confirmation.
	 
	(b)	 	The parties hereto intend for:

	 	(i)	 	Seller to be a “financial institution” as defined in Section 101(22) of Title
11 of the United States Code (the “Bankruptcy Code”) and this Transaction to be
a “securities contract” as defined in Section 741(7) of the Bankruptcy Code and a “swap
agreement” as defined in Section 101(53C) of the Bankruptcy Code, qualifying for the
protections of, among other sections, Sections 362(b)(6), 362 (b)(17), 546(e), 546(g),
555 and 560 of the Bankruptcy Code;
	 
	 	(ii)	 	a party’s right to liquidate this Transaction and to exercise any other
remedies upon the occurrence of any Event of Default under the Agreement with respect
to the other party to constitute a “contractual right” as defined in the Bankruptcy
Code;
	 
	 	(iii)	 	all payments for, under or in connection with this Transaction, all payments
for the Shares and the
transfer of such Shares to constitute “settlement payments” as defined in the
Bankruptcy Code.

Amendment of Section 6(d)(ii). Section 6(d)(ii) of the Agreement is modified by deleting
the words “on the day” in the second line thereof and substituting therefore “on the day that is
three Local Business Days after the day.” Section 6(d)(ii) is further modified by deleting
the words “two Local Business Days” in the fourth line thereof and substituting therefore “three
Local Business Days.”

Consent to Recording. Each party consents to the recording of the telephone conversations of
trading and marketing personnel of the parties and their Affiliates in connection with this
Confirmation. To the extent that one party records telephone conversations (the “Recording Party”)
and the other party does not (the “Non-Recording  Party”), the Recording Party shall in the
event of any dispute, make a complete and unedited copy of such party’s tape of the entire day’s
conversations with the Non-Recording Party’s personnel available to the Non-Recording Party. The
Recording Party’s tapes may be used by either party in any forum in which a dispute is sought to be
resolved and the Recording Party will retain tapes for a consistent period of time in accordance
with the Recording Party’s policy unless one party notifies the other that a particular transaction
is under review and warrants further retention.

Disclosure. Each party hereby acknowledges and agrees that Seller has authorized Counterparty to
disclose this Transaction and any related hedging transaction between the parties if and to the
extent that Counterparty reasonably

Confirmation OTC Convertible Note Hedge (amended)

- 16 -

 

determines (after consultation with Seller) that such disclosure is required by law or by the rules
of the New York Stock Exchange or any securities exchange. Notwithstanding the foregoing,
effective from the date of commencement of discussions concerning the Transaction, Counterparty and
each of its employees, representatives, or other agents may disclose to any and all persons,
without limitation of any kind, the tax treatment and tax structure of the Transaction and all
materials of any kind (including opinions or other tax analyses) that are provided to Counterparty
relating to such tax treatment and tax structure.

Severability. If any term, provision, covenant or condition of this Confirmation, or the
application thereof to any party or circumstance, shall be held to be invalid or unenforceable in
whole or in part for any reason, the remaining terms, provisions, covenants, and conditions hereof
shall continue in full force and effect as if this Confirmation had been executed with the invalid
or unenforceable provision eliminated, so long as this Confirmation as so modified continues to
express, without material change, the original intentions of the parties as to the subject matter
of this Confirmation and the deletion of such portion of this Confirmation will not substantially
impair the respective benefits or expectations of parties to this Agreement; provided, however,
that this severability provision shall not be applicable if any provision of Section 2,
5, 6 or 13 of the Agreement (or any definition or provision in Section
14 to the extent that it relates to, or is used in or in connection with any such Section)
shall be so held to be invalid or unenforceable.

Affected Parties. For purposes of Section 6(e) of the Agreement, each party shall be
deemed to be an Affected Party in connection with Illegality and any Tax Event.

[Signatures follow on separate page]

Confirmation OTC Convertible Note Hedge (amended)

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

	 	 	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	 	 	CITIBANK, N.A.	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	By:	 	/s/ JASON SHREDNICK	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Jason Shrednick	 	 
	 	 	Title:	 	Authorized Signatory	 	 

Confirmed as of the date first above written:

	 	 	 	 	 	 	 
	TEKTRONIX, INC.	 	 
	 
	 	 	 	 	 	 
	By:	 	/s/ JAMES F. DALTON	 	 
	 	 	 	 	 
	Name:	 	James F. Dalton	 	 
	Title:	 	Senior Vice President,	 	 
	 

	 	 	 	General Counsel, and Secretary	 	 

Confirmation
OTC Convertible Note Hedge (amended)

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00125-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00125-of-00352.parquet"}]]