Document:

Exhibit 10.4

 

 

JPMorgan Chase Bank, National Association

P.O. Box 161

60 Victoria Embankment

London EC4Y 0JP

England

 

April 29, 2009

To: Textron Inc.

40 Westminster Street

Providence, RI 02903

Attention: Chief Financial Officer

	
  Telephone No.:

  	
  (401) 421-2800

  
	
  Facsimile No.:

  	
  (401) 457-3533

  

 

Re:                           Issuer
Warrant Transaction

 

The purpose of
this letter agreement (this “Confirmation”)  is to confirm the terms and conditions of the Warrants
issued by Textron Inc. (the “Company”)
to JPMorgan Chase Bank, National Association, London Branch (“Bank”), represented by J.P. Morgan Securities Inc. (“Agent”) as its agent, on the Trade Date specified below (the
“Transaction”).  This letter agreement constitutes a
“Confirmation” as referred to in the ISDA Master Agreement specified below.
This Confirmation shall replace any previous agreements and serve as the final
documentation for the Transaction.

 

The
definitions and provisions contained in the 1996 ISDA Equity Derivatives
Definitions (the “Equity Definitions”), as published
by the International Swaps and Derivatives Association, Inc. (“ISDA”), are incorporated into this Confirmation. In the
event of any inconsistency between the Equity Definitions and this
Confirmation, this Confirmation shall govern. The Transaction shall be deemed
to be a Share Option Transaction within the meaning set forth in the Equity
Definitions.

 

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

 

1.                                     This
Confirmation evidences a complete and binding agreement between Bank and the
Company as to the terms of the Transaction to which this Confirmation relates.
This Confirmation shall supplement, form a part of, and be subject to an
agreement in the form of the 2002 ISDA Master Agreement (the “Agreement”)  as if Bank and the Company had
executed an agreement in such form (but without any Schedule except for the
election of United States dollars as the Termination Currency) on the Trade
Date. In the event of any inconsistency between provisions of that Agreement
and this Confirmation, this Confirmation will prevail for the purpose of the
Transaction to which this Confirmation relates. The parties hereby agree that
no Transaction other than the Transaction to which this Confirmation relates
shall be governed by the Agreement.

 

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

 

	
  General Terms:

  	
   

  
	
   

  	
   

  
	
  Trade Date:

  	
  April 29, 2009

  

 

 

JPMorgan Chase Bank, National Association

Organised under the laws of the United States
as a National Banking Association

Main Office 1111 Polaris Parkway, Columbus,
Ohio 43271

Registered as a branch in England & Wales
branch No. BR000746

Registered Branch Office 125 London Wall,
London EC2Y 5AJ

Authorised and regulated by the Financial
Services Authority

 

 

	
  Warrants:

  	
  Equity call warrants, each giving the holder the right to purchase
  one Share at the Strike Price, subject to the Settlement Terms set forth
  below. For the purposes of the Equity Definitions, each reference to a
  Warrant herein shall be deemed to be a reference to a Call Option.

  
	
   

  	
   

  
	
  Warrant Style:

  	
  European

  
	
   

  	
   

  
	
  Buyer:

  	
  Bank

  
	
   

  	
   

  
	
  Seller:

  	
  The Company

  
	
   

  	
   

  
	
  Shares:

  	
  The common stock of Company, par value USD 0.125 per Share  (Exchange symbol “TXT”)

  
	
   

  	
   

  
	
  Number of Warrants:

  	
  20,571,435, subject to adjustments provided herein

  
	
   

  	
   

  
	
  Daily Number of Warrants:

  	
  For any Expiration Date, as provided in Schedule A to this
  Confirmation, subject to adjustment pursuant to the provisos to “Expiration
  Date(s)”.

  
	
   

  	
   

  
	
  Warrant Entitlement:

  	
  One Share per Warrant 

  
	
   

  	
   

  
	
  Number of Shares:

  	
  The product of the Number of Warrants and the Warrant Entitlement

  
	
   

  	
   

  
	
  Strike Price:

  	
  USD 15.75

  
	
   

  	
   

  
	
  Premium:

  	
  USD 42,336,000

  
	
   

  	
   

  
	
  Premium Payment Date:

  	
  May 5, 2009

  
	
   

  	
   

  
	
  Exchange:

  	
  The New York Stock Exchange

  
	
   

  	
   

  
	
  Related Exchange(s):

  	
  The principal exchange(s) for options contracts or futures
  contracts, if any, with respect to the Shares.

  
	
   

  	
   

  
	
  Exercise and Valuation:

  	
   

  
	
   

  	
   

  
	
  Expiration Time:

  	
  The Valuation Time

  
	
   

  	
   

  
	
  Expiration Date(s):

  	
  Each Exchange Business Day during the period from and including the
  First Expiration Date to and including the 45th Exchange Business Day
  following the First Expiration Date shall be an “Expiration Date” for a
  number of Warrants equal to the Daily Number of Warrants on such date; provided that, notwithstanding the
  foregoing and anything to the contrary in the Equity Definitions, if a Market
  Disruption Event occurs on any Expiration Date (including the First
  Expiration Date), the Calculation Agent shall make adjustments, if
  applicable, to the Daily Number of Warrants or shall reduce such Daily Number
  of Warrants to zero for which such day shall be an Expiration Date and shall
  designate an Exchange Business Day or a number of Exchange Business Days as
  the Expiration Date(s) for the remaining Daily Number of Warrants or a
  portion thereof for the originally scheduled Expiration Date; and provided further that if such Expiration
  Date has not occurred pursuant to this clause as of the eighth Exchange
  Business Day following the last scheduled Expiration Date under the
  Transaction, the Calculation Agent shall have the right to declare such
  Exchange Business Day to be the final Expiration Date and the Calculation
  Agent shall determine its good faith estimate of the fair market value for
  the Shares as of the Valuation Time on that eighth Exchange Business Day or
  on any subsequent Exchange Business Day, as the Calculation Agent shall
  determine using commercially reasonable means.

  
	
   

  	
   

  
	
  First Expiration Date:

  	
  August 1, 2013, subject to Market Disruption Event below.

  
	
   

  	
   

  
	
  Automatic Exercise:

  	
  Applicable; and means that a number of Warrants for each Expiration
  Date equal to the Daily Number of Warrants (as adjusted pursuant to the terms
  

  

 

2

 

	
   

  	
  hereof) for such Expiration Date will be deemed to be automatically exercised.

  
	
   

  	
   

  
	
  Market Disruption Event:

  	
  Section 4.3(a)(ii) is hereby amended by adding after the
  words “or Share Basket Transaction” in the first line thereof a phrase “a
  failure by the Exchange or Related Exchange to open for trading during its
  regular trading session or” and replacing the phrase “during the one-half
  hour period that ends at the relevant Valuation Time” with the phrase “at any
  time during the regular trading session on the Exchange or any Related
  Exchange, without regard to after hours or any other trading outside of the
  regular trading session hours”.

  
	
   

  	
   

  
	
  Valuation applicable to each Warrant:

  
	
   

  
	
  Valuation Time:

  	
  At the close of trading of the regular trading session on the
  Exchange; provided that if the
  principal trading session is extended, the Calculation Agent shall determine
  the Valuation Time in its reasonable discretion.

  
	
   

  	
   

  
	
  Valuation Date:

  	
  Each Exercise Date. Notwithstanding anything to the contrary in the
  Equity Definitions, if there is a Market Disruption Event on any Valuation
  Date, then the Calculation Agent shall determine the Settlement Price for
  such Valuation Date on the basis of its good faith estimate of the market
  value for the relevant Shares on such Valuation Date.

  
	
   

  	
   

  
	
  Settlement Terms applicable to the Transaction:

  	
   

  
	
   

  	
   

  
	
  Method of Settlement:

  	
  Net Share Settlement; provided that
  Cash Settlement shall apply if the Company validly elects Cash Settlement
  pursuant to the provisions of “Cash Settlement Election” below.

  
	
   

  	
   

  
	
  Net Share Settlement:

  	
  On the relevant Settlement Date, Company shall deliver to Bank, the
  Share Delivery Quantity of Shares for such Settlement Date to the account
  specified hereto free of payment through the Clearance System.

  
	
   

  	
   

  
	
  Share Delivery Quantity:

  	
  For any Settlement Date, a number of Shares, as calculated by the
  Calculation Agent, equal to the Net Share Settlement Amount for such
  Settlement Date divided by the
  Settlement Price on the Valuation Date in respect of such Settlement Date
  rounded down to the nearest whole number, plus
  cash in lieu of any fractional Shares (based on such Settlement
  Price).

  
	
   

  	
   

  
	
  Net Share Settlement Amount:

  	
  For any Settlement Date, an amount equal to the product of (i) the
  Number of Warrants exercised or deemed exercised on the relevant Exercise
  Date, (ii) the Strike Price Differential for such Settlement Date and (iii) the
  Warrant Entitlement. 

  
	
   

  	
   

  
	
  Strike Price Differential:

  	
  (a)  If the Settlement Price for any Valuation Date is greater
  than the Strike Price, an amount equal to the excess of such Settlement Price
  over the Strike Price; or

  
	
   

  	
   

  
	
   

  	
  (b)  If such Settlement Price is less than or equal to the
  Strike Price, zero.

  
	
   

  	
   

  
	
  Settlement Price:

  	
  For any Valuation Date, the per Share volume-weighted average price
  for such Valuation Date as displayed under the heading “Bloomberg VWAP” on Bloomberg
  page TXT.N <equity> AQR (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
  Valuation Date or if such price is unavailable, the market value of one Share
  on such Valuation Date, as determined by the Calculation Agent in its
  reasonable discretion (in each case, without regard to pre-open or after
  hours trading outside of any regular trading session for such Valuation
  Date). Notwithstanding anything to the contrary in the Equity Definitions, if
  there is a Market Disruption Event on any Valuation Date, then the
  Calculation Agent shall determine the Settlement Price for such Valuation
  Date on the basis of its good faith estimate of the market value for the
  relevant Shares on such 

  

 

3

 

	
   

  	
  Valuation Date.

  
	
   

  	
   

  
	
  Settlement Date:

  	
  For any Exercise Date, the date defined as such in Section 6.2
  of the Equity Definitions, subject to Section 9(o)(i) hereof.

  
	
   

  	
   

  
	
  Cash Settlement Election:

  	
  With respect to all Warrants to be exercised on the Expiration Dates,
  the Company can elect Cash Settlement by delivering a written notice to Bank
  (the “Cash Settlement Notice”) on or prior to the fifth (5th) scheduled Exchange
  Business Day immediately preceding the First Expiration Date, which Cash
  Settlement Notice shall contain:

  
	
   

  	
   

  
	
   

  	
  (i)  a representation that (x) on the date of such Cash
  Settlement Notice, neither the Company nor any of its affiliates is in
  possession of any material non-public information with respect to the Company
  or its Shares, (y) the Company is electing Cash Settlement in good faith
  and not as part of a plan or scheme to evade the prohibitions of Rule 10b-5
  under the Securities Exchange Act of 1934, as amended (the “Exchange
  Act”)  and (z) the
  Company has not entered into or altered any hedging transaction relating to
  the Shares corresponding to or offsetting the Transaction;

  
	
   

  	
   

  
	
   

  	
  (ii)  a representation that the Company is not electing Cash
  Settlement to create actual or apparent trading activity in the Shares (or
  any security convertible into or exchangeable for the Shares) or to raise or
  depress or otherwise manipulate the price of the Shares (or any security
  convertible into or exchangeable for the Shares);

  
	
   

  	
   

  
	
   

  	
  (iii)  an acknowledgment by the Company that (A) any
  transaction by Bank following the Company’s election of Cash Settlement shall
  be made at Bank’s sole discretion and for Bank’s own account and (B) the
  Company does not have, and shall not attempt to exercise, any influence over
  how, when, whether or at what price to effect such transactions, including,
  without limitation, the price paid or received per Share pursuant to such
  transactions, or whether such transactions are made on any securities
  exchange or privately; 

  
	
   

  	
   

  
	
   

  	
  (iv)  an agreement by the Company that, during the period
  commencing on the date of such Cash Settlement Notice and ending on the
  second Exchange Business Day following the last Settlement Date hereunder,
  without the prior written consent of Bank, the Company shall not, and shall cause
  its affiliates and affiliated purchasers (each as defined in Rule 10b-18
  under the Exchange Act) not to, directly or indirectly (including, without
  limitation, by means of a derivative instrument), purchase, offer to
  purchase, place any bid or limit order that would effect a purchase of, or
  commence any tender offer relating to, any Shares or any security convertible
  into or exchangeable for the Shares in the public markets; and

  
	
   

  	
   

  
	
   

  	
  (v) a representation that the assets of Company at their fair
  valuation exceed the liabilities of Company, including contingent
  liabilities; the capital of Company is adequate to conduct the business of
  Company; and Company has the ability to pay its debts and obligations as such
  debts mature and does not intend to, or does not believe that it will, incur
  debt beyond its ability to pay as such debts mature.

  
	
   

  	
   

  
	
  Cash Settlement: 

  	
  If Cash Settlement is applicable, on each Settlement Date, the
  Company shall deliver to Bank (to an account specified by Bank) the Net Share
  Settlement Amount for such Settlement Date.

  
	
   

  	
   

  
	
   

  	
  In addition to any other requirements set forth herein, the Company
  agrees that it shall not have the right to elect Cash Settlement if Bank
  notifies the Company that, in the reasonable judgment of Bank the election of
  Cash Settlement or any purchases of Shares that Bank (or its affiliates)
  might make 

  

 

4

 

	
   

  	
  in connection therewith based upon the advice of counsel and as a
  result of events occurring after the Trade Date, would raise material risks
  under applicable securities laws.

  
	
   

  	
   

  
	
  Failure to Deliver:

  	
  Inapplicable

  
	
   

  	
   

  
	
  Other Applicable Provisions:

  	
  The provisions of Sections 6.6, 6.7, 6.8, 6.9 and 6.10 of the Equity
  Definitions will be applicable, except that all references in such provisions
  to “Physically-Settled” shall be read as references to “Net Share Settled”. “Net
  Share Settled” in relation to any Warrant means that Net Share Settlement is
  applicable to that Warrant.

  
	
   

  	
   

  
	
  3.     Additional Terms
  applicable to the Transaction:

  
	
   

  
	
  Adjustments applicable to the Warrants:

  	
   

  
	
   

  	
   

  
	
  Method of Adjustment:

  	
  Calculation Agent Adjustment. For the avoidance of doubt, in making
  any adjustments under the Equity Definitions, the Calculation Agent may
  adjust the Strike Price, the Number of Warrants, the Daily Number of Warrants
  and the Warrant Entitlement. Notwithstanding the foregoing, any cash
  dividends or distributions on the Shares, whether or not extraordinary, shall
  be governed by Section 9(j) of this Confirmation and not by Section 9.1(c) of
  the Equity Definitions.

  
	
   

  	
   

  
	
  Extraordinary Events applicable to the Transaction: 

  	
   

  
	
   

  	
   

  
	
  Consequence of Merger Events

  	
   

  
	
   

  	
   

  
	
  (a) Share-for-Share: 

  	
  Alternative Obligation; provided that
  the Calculation Agent will determine if the Merger Event affects the
  theoretical value of the Transaction and if so Bank in its sole discretion
  may elect to make adjustments to any of the Strike Price, the Number of
  Warrants, the Daily Number of Warrants, the Warrant Entitlement and any other
  term necessary to reflect the characteristics (including volatility, dividend
  practice, borrow cost and liquidity) of the New Shares. Notwithstanding the
  foregoing, Cancellation and Payment shall apply in the event the New Shares
  are not publicly traded on a United States national securities exchange or
  quoted on The NASDAQ Global Select Market or The NASDAQ Global Market (or
  their respective successors).

  
	
   

  	
   

  
	
  (b) Share-for-Other:

  	
  Cancellation and Payment

  
	
   

  	
   

  
	
  (c) Share-for-Combined: 

  	
  Cancellation and Payment; provided
  that on or prior to the Merger Date the Bank may elect, in its
  sole discretion, to apply the consequence specified opposite “Share for Share”
  to that portion of the consideration that consists of New Shares (as
  determined by the Calculation Agent) and the consequence specified opposite “Share
  for-Other” to that portion of the consideration that consists of Other
  Consideration (as determined by the Calculation Agent).

  
	
   

  	
   

  
	
  In the event of any “Tender Offers” (as defined in the 2002 ISDA
  Equity Derivatives Definitions (the “2002 Definitions”)), the following consequences, each
  as defined in the 2002 Definitions and including any relevant cross
  references, shall apply to such Tender Offers:

  
	
   

  
	
  (a) Share-for-Share:

  	
  Modified Calculation Agent Adjustment (as defined in the 2002 Definitions
  and including any relevant cross references)

  
	
   

  	
   

  
	
  (b) Share-for-Other:

  	
  Modified Calculation Agent Adjustment (as defined in the 2002
  Definitions and including any relevant cross references)

  

 

5

 

	
  (c) Share-for-Combined:

  	
  Modified Calculation Agent Adjustment (as defined in the 2002
  Definitions and including any relevant cross references)

  
	
   

  	
   

  
	
  Nationalization or Insolvency:

  	
  Cancellation and Payment

  
	
   

  	
   

  
	
  4.     Calculation Agent:

  	
  Bank; provided that all determinations
  made by the Calculation Agent shall be made in good faith and in a
  commercially reasonable manner. 
  Following any calculation by the Calculation Agent hereunder and a
  prior written request by Company, the Calculation Agent will provide to
  Company by e-mail to the e-mail address provided by Company in such prior
  written request a report (in a commonly used file format for the storage and
  manipulation of financial data) displaying in reasonable detail the basis for
  such calculation.  For the avoidance of
  doubt, nothing in this provision will require Bank to provide its proprietary
  models to Company.

  

 

5.     Account Details:

 

	
  (a)

  	
  Account for
  payments to Company:

  
	
   

  	
   

  
	
   

  	
  JPMorgan
  Chase

  
	
   

  	
  New York, NY

  
	
   

  	
  Fed Wire:
  021000021

  
	
   

  	
  Swift / BIC:
  CHASUS33

  
	
   

  	
  CHIP No: 0002

  
	
   

  	
  CHIP UID:
  280099

  
	
   

  	
  Account
  name: Textron Inc.

  
	
   

  	
  Account No:
  9101013655

  
	
   

  	
   

  
	
   

  	
  Account for
  delivery of Shares from Company:

  
	
   

  	
   

  
	
   

  	
  To be
  provided by Company

  
	
   

  	
   

  
	
  (b)

  	
  Account for
  payments to Bank:

  
	
   

  	
   

  
	
   

  	
  JPMorgan
  Chase Bank, National Association, New York

  
	
   

  	
  ABA: 021 000
  021

  
	
   

  	
  Favour:
  JPMorgan Chase Bank, National Association — London

  
	
   

  	
  A/C:
  0010962009 CHASUS33

  
	
   

  	
   

  
	
   

  	
  Account for
  delivery of Shares to Bank:

  
	
   

  	
   

  
	
   

  	
  DTC 0060

  

 

6.     Offices:

 

The Office of
Company for the Transaction is: Inapplicable, Company is not a Multibranch
Party.

 

The Office of Bank for the
Transaction is:  London

 

JPMorgan Chase Bank, National Association

London Branch

P.O. Box 161

60 Victoria Embankment

London EC4Y 0JP

England

 

6

 

7.     Notices: For purposes of
this Confirmation:

 

(a)                                  Address
for notices or communications to Company:

 

Textron Inc.

40 Westminster Street

Providence, RI 02903

Attention: Chief Financial Officer

Telephone No.:     (401) 421-2800

Facsimile No.:       (401) 457-3533

 

Address for notices or communications to Bank:

 

JPMorgan Chase
Bank, National Association

277 Park
Avenue, 11th Floor

New York,
NY  10172

Attention: Mariusz
Kwasnik

Title:  Operations Analyst

EDG Corporate Marketing

Telephone No:  (212) 623-7223

Facsimile
No:   (212) 622-8534

 

8.             Representations and
Warranties of the Company

 

The
representations and warranties of the Company set forth in Article VII of
the Textron Inc. Underwriting Agreement Standard Provisions (Debt), dated as of
April 29, 2009, and incorporated by reference into the Underwriting
Agreement (the “Underwriting Agreement”), dated as
of April 29, 2009, between Company and J.P. Morgan Securities Inc. and
Goldman, Sachs & Co., as representatives of the underwriters party
thereto (the “Underwriters”), are true and correct
and are hereby deemed to be repeated to Bank as if set forth herein. The
Company hereby further represents and warrants to Bank that:

 

(a)                                  Company
has all necessary corporate power and authority to execute, deliver and perform
its obligations in respect of the Transaction; such execution, delivery and
performance have been duly authorized by all necessary corporate action on
Company’s part; and this Confirmation has been duly and validly executed and
delivered by Company and constitutes its valid and binding obligation,
enforceable against Company in accordance with its terms, subject to applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
similar laws affecting creditors’ rights and remedies generally and to general
principles of equity, including principles of commercial reasonableness, good
faith and fair dealing (whether considered in a proceeding at law or in equity)
and except that rights to indemnification and contribution hereunder may be
limited by federal or state securities laws or public policy relating thereto.

 

(b)                                 Neither
the execution and delivery of this Confirmation nor the incurrence or
performance of obligations of Company hereunder will conflict with or result in
a breach of the certificate of incorporation or by-laws (or any equivalent
documents) of Company, or any applicable law or regulation, or any order, writ,
injunction or decree of any court or governmental authority or agency, or any
agreement or instrument to which Company or (to the extent such agreement is
material to Company and its subsidiaries taken as a whole) any of its
subsidiaries is a party or by which Company or (to such extent) any of its
subsidiaries is bound or to which Company or (to such extent) any of its
subsidiaries is subject, or constitute a default under, or result in the
creation of any lien under, any such agreement or instrument.

 

(c)                                  No
consent, approval, authorization, or order of, or filing with, any governmental
agency or body or any court is required in connection with the execution,
delivery or performance by Company of this Confirmation, except such as have
been obtained or made and such as may be required under the Securities Act of
1933, as amended (the “Securities Act”)
or state securities laws.

 

7

 

(d)                                 The
Shares initially issuable upon exercise of the Warrant by the net share
settlement method (the “Warrant Shares”)
have been reserved for issuance by all required corporate action of
Company.  The Warrant Shares have been
duly authorized and, when delivered against payment therefor (which may include
Net Share Settlement in lieu of cash) and otherwise as contemplated by the
terms of the Warrant following the exercise of the Warrant in accordance with
the terms and conditions of the Warrant, will be validly issued, fully-paid and
non-assessable, and the issuance of the Warrant Shares will not be subject to
any preemptive or similar rights.

 

(e)                                  The
Company is an “eligible contract participant” (as such term is defined in Section 1(a)(12)
of the Commodity Exchange Act, as amended.

 

(f)                                    The
Company and each of its affiliates is not, on the date hereof, in possession of
any material non-public information with respect to Company.

 

(g)                                 The
Company is a “qualified institutional buyer” as defined in Rule 144A under
the Securities Act.

 

(h)                                 The
assets used by the Company for its obligations under the Transaction (1) are
not assets of any “plan” (as such term is defined in Section 4975 of the
Internal Revenue Code (the “Code”))  subject
to Section 4975 of the Code or any “employee benefit plan” (as such term
is defined in Section 3(3) of the Employee Retirement Income Security
Act of 1974, as amended (“ERISA”)) subject to Title I of
ERISA, and (2) do not constitute “plan assets” within the meaning of
Department of Labor Regulation 2510.3-101, 29 CFR Section 2510-3-101.

 

(i)                                     There
is no law, rule, regulation or regulatory order (collectively, “Adverse Laws”) that, as a result of the ownership or control
(whether direct, beneficial, constructive or otherwise) of Shares by  JPMorgan Chase & Co. (“Bank Parent”) or any person controlled directly or
indirectly by Bank Parent, would give rise to reporting or registration
obligations or a requirement to obtain prior approval from any person or entity
on  Bank Parent or any such controlled
person or would result in a not insignificant adverse effect on Bank Parent or
any such controlled person, other than any Adverse Law that applies to the
ownership of equity positions generally without regard to the nature of the
issuer’s business (such as Sections 13 and 16 of the Exchange Act) or any
Adverse Law that applies solely as a result of the business, identity, place of
business or jurisdiction of organization of the holder of the common stock
(such as the Bank Holding Company Act of 1956, as amended).

 

(j)                                     Other
than Textron Business Credit, Inc., which is a “Rhode Island financial
institution,” and Textron Financial Corporation, which is a “Rhode Island bank
holding company” but is not a bank holding company under the Bank Holding
Company Act of 1956, as amended, Company is not and does not control, directly
or indirectly, a bank or bank holding company or other financial institution
regulated under federal or state banking law.

 

9.             Other Provisions:

 

(a)                                  Opinions. The Company shall deliver an
opinion of counsel (including an in-house lawyer of the Company), dated as of
the Trade Date, to Bank with respect to the matters set forth in Sections 8(a) through
(d) of this Confirmation.

 

(b)                                 No Reliance, etc. Each party
represents that (i) it is entering into the Transaction evidenced hereby
as principal (and not as agent or in any other capacity); (ii) neither the
other party or parties nor any of
its or their agents are acting as a fiduciary for it; (iii) it is not
relying upon any representations except those expressly set forth in the
Agreement or this Confirmation; (iv) it has not relied on the other party
or parties for any legal, regulatory, tax, business, investment, financial, and
accounting advice, and it has made its own investment, hedging, and trading
decisions based upon its own judgment and not upon any view expressed by the
other party or 

 

8

 

parties or any
of its or their agents; and (v) it is entering into the Transaction with a
full understanding of the terms, conditions and risks thereof and it is capable
of and willing to assume those risks.

 

(c)                                  Repurchase Notices. The Company shall,
on any day on which the Company effects any repurchase of Shares, promptly give
Bank a written notice of such repurchase (a “Repurchase Notice”) on
such day if following such repurchase, the quotient of (i) the sum of (A) the
Number of Shares for the Transaction and (B) the aggregate number of
Shares underlying any other warrants purchased by Bank from Company, if any, divided by (ii) the number of the
Company’s outstanding Shares (such quotient expressed as a percentage, the “Warrant
Equity Percentage”)  would
be (x) greater than 9.0% or (y) 0.5% greater than the Warrant Equity
Percentage included in the immediately preceding Repurchase Notice. The Company
agrees to indemnify and hold harmless Bank and its affiliates and their
respective officers, directors, employees, affiliates, advisors, agents and controlling
persons (each, an “Indemnified Person”)  from and against any and all losses
(including losses relating to Bank’s hedging activities as a consequence of
becoming, or of the risk of becoming, a Section 16 “insider”, including
without limitation, any forbearance from hedging activities or cessation of
hedging activities and any losses in connection therewith with respect to the
Transaction), claims, damages, judgments, liabilities and expenses (including
reasonable attorney’s fees), joint or several, which an Indemnified Person
actually may become subject to, as a result of the Company’s failure to provide
Bank with a Repurchase Notice on the day and in the manner specified in this
paragraph, and to reimburse, within 30 days, upon written request, each of such
Indemnified Persons for any reasonable legal or other expenses incurred in
connection with investigating, preparing for, providing testimony or other
evidence in connection with or defending any of the foregoing. If any suit,
action, proceeding (including any governmental or regulatory investigation),
claim or demand shall be brought or asserted against the Indemnified Person,
such Indemnified Person shall promptly notify the Company in writing, and the
Company, upon request of the Indemnified Person, shall retain counsel
reasonably satisfactory to the Indemnified Person to represent the Indemnified
Person and any others the Company may designate in such proceeding and shall
pay the fees and expenses of such counsel related to such proceeding. The Company
shall not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the Company agrees to indemnify any Indemnified
Person from and against any loss or liability by reason of such settlement or
judgment. The Company shall not, without the prior written consent of the
Indemnified Person, effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Person is or could have been a
party and indemnity could have been sought hereunder by such Indemnified
Person, unless such settlement includes an unconditional release of such
Indemnified Person from all liability on claims that are the subject matter of
such proceeding on terms reasonably satisfactory to such Indemnified Person. If
the indemnification provided for in this paragraph is unavailable to an
Indemnified Person or insufficient in respect of any losses, claims, damages or
liabilities referred to therein, then Company under such paragraph, in lieu of
indemnifying such Indemnified Person thereunder, shall contribute to the amount
paid or payable by such Indemnified Person as a result of such losses, claims,
damages or liabilities. The remedies provided for in this paragraph are not
exclusive and shall not limit any rights or remedies which may otherwise be
available to any Indemnified Person at law or in equity. The indemnity and
contribution agreements contained in this paragraph shall remain operative and in
full force and effect regardless of the termination of the Transaction.

 

(d)                                 Regulation M. The Company is not, on
the Trade Date or any Exercise Date, and will not be, on any day during the
period commencing on such Exercise Date and ending on the second Exchange
Business Day following the last Settlement Date with respect to such Exercise
Date, engaged in a distribution, as such term is used in Regulation M under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”),  of any securities of the Company,
other than the concurrent distributions of the USD 540,000,000 principal amount
of 4.50% Convertible Notes due 2013 and Shares being made on the date hereof.
The Company shall not, until the second Exchange Business Day immediately
following the Trade Date, engage in any such distribution.

 

9

 

(e)                                  No
Manipulation. The Company is not entering
into the Transaction to create actual or apparent trading activity in the
Shares (or any security convertible into or exchangeable for the Shares) or to
raise or depress or otherwise manipulate the price of the Shares (or any
security convertible into or exchangeable for the Shares).

 

(f)                                    Board
Authorization. The Company represents that
it is entering into the Transaction, solely for the purposes stated in the
board resolution authorizing the Transaction and in its public disclosure. The
Company further represents that there is no internal policy, whether written or
oral, of the Company that would prohibit the Company from entering into any
aspect of the Transaction, including, but not limited to, the issuances of
Shares to be made pursuant hereto.

 

(g)                                 Transfer
or Assignment. The Company may not transfer
any of its rights or obligations under the Transaction without the prior
written consent of Bank. Bank may transfer or assign all or any portion of its
rights or obligations under the Transaction without consent of the Company to
any third party with a rating for its long term, unsecured and unsubordinated
indebtedness equal to or better than the lesser of (1) the credit rating
of Bank at the time of the transfer and (2) A- by Standard and Poor’s
Rating Group, Inc. or its successor (“S&P”),
or A3 by Moody’s Investor Service, Inc. (“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 agency rating
mutually agreed by Company and Bank. If, however, in Bank’s sole discretion,
Bank is unable to effect a transfer or assignment on pricing terms reasonably
acceptable to Bank and within a time period reasonably acceptable to Bank of a
sufficient number of Warrants to reduce (i) Bank Group’s “beneficial
ownership” (within the meaning of Section 13 or Section 16 of the
Exchange Act and rules promulgated thereunder) to equal to or less than
7.5%, (ii) the Warrant Equity Percentage to equal to or less than 14.5%,
and (iii) the Share Amount to equal to or less than the Post-Effective
Limit (if any applies), Bank may designate any Exchange Business Day as an
Early Termination Date with respect to a portion (the “Terminated Portion”)  of the Transaction, such that (i) Bank
Group’s “beneficial ownership” following such partial termination will be equal
to or less than 7.5%, (ii) the Warrant Equity Percentage following such
partial termination will be equal to or less than 14.5%, and (iii) the
Share Amount following such partial termination will be equal to or less than
such Post-Effective Limit. In the event that Bank so designates an Early
Termination Date with respect to a portion of the 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 the Transaction and a Number of Warrants equal to the Terminated
Portion, (ii) the Company shall be the sole Affected Party with respect to
such partial termination and (iii) such Transaction shall be the only
Terminated Transaction (and, for the avoidance of doubt, the provision of
paragraph 9(n) shall apply to any amount that is payable by the Company to
Bank pursuant to this sentence). Notwithstanding any other provision in this
Confirmation to the contrary requiring or allowing Bank to purchase, sell,
receive or deliver any Shares or other securities to or from the Company, Bank
may designate any of its affiliates to purchase, sell, receive or deliver such
Shares or other securities and otherwise to perform Bank’s obligations in
respect of the Transaction and any such designee may assume such obligations.
Bank shall be discharged of its obligations to the Company to the extent of any
such performance.  “Bank Group”
means Bank and each business unit of its affiliates subject to aggregation with
Bank under Section 13 or Section 16 of the Exchange Act and rules promulgated
thereunder.  The “Share Amount”
as of any day is the number of Shares that Bank and any person whose ownership
position would be aggregated with that of Bank (Bank or any such person, a “Bank Person”) under any law, rule,
regulation or regulatory order that for any reason becomes applicable to
ownership of Shares after the Trade Date (“Applicable
Laws”), owns, beneficially owns, constructively owns, controls,
holds the power to vote or otherwise meets a relevant definition of ownership
of under the Applicable Laws, as determined by Bank in its reasonable
discretion. The “Post-Effective Limit” means (x) the
minimum number of Shares that would give rise to reporting or registration
obligations or other requirements (including obtaining prior approval from any
person or entity) of a Bank Person, or would result in an adverse effect on a
Bank Person, under the Applicable Laws, as determined by Bank in its reasonable
discretion, minus (y) 1% of
the number of Shares outstanding.  If at
any time Bank determines, in its reasonable opinion based upon advice of
counsel, that as a result of Company’s 

 

10

 

direct or indirect interest
in, or direct or indirect control of, either Textron Business Credit, Inc.
or Textron Financial Corporation, any state or federal laws are or have become
applicable to Bank’s ownership of Shares, then the Post-Effective Limit and the
Share Amount shall be determined as set forth above in the definitions of those
terms, irrespective of whether or not such laws have been applicable to
ownership of Shares on or prior to the Trade Date.

 

(h)                                 Damages.
Neither party shall be liable under Section 6.10 of the Equity
Definitions for special, indirect or consequential damages, even if informed of
the possibility thereof, except as specifically set forth otherwise herein.

 

(i)                                     Early
Unwind. In the event the sale of
Convertible Notes is not consummated with the Underwriters for any reason or
the Company fails to deliver to Bank opinions of counsel as required pursuant
to Section 9(a) by the close of business in New York on May 5,
2009 (or such later date as agreed upon by the parties, May 5, 2009 or
such later date the “Early Unwind Date”),  the Transaction shall automatically
terminate (the “Early Unwind”),  on
the Early Unwind Date and (i) the Transaction and all of the respective
rights and obligations of Bank and the Company under the Transaction shall be
cancelled and terminated and (ii) each party shall be released and
discharged by the other party from and agrees not to make any claim against the
other party with respect to any obligations or liabilities of the other party
arising out of and to be performed in connection with the Transaction either
prior to or after the Early Unwind Date; provided
that, other than to the extent the Early Unwind Date occurred as a
result of the breach of the Underwriting Agreement by the Underwriters, the
Company shall reimburse Bank, in cash or Shares, for any costs or expenses
(including market losses) relating to the unwinding of its or its affiliate’s
hedging activities in connection with the Transaction (including any loss or
cost incurred as a result of its terminating, liquidating, obtaining or
reestablishing any hedge or related trading position). The amount of any such
reimbursement shall be determined by Bank in its sole good faith discretion.
Bank shall notify the Company of such amount and the Company shall pay such
amount in immediately available funds or deliver Shares on the Early Unwind
Date. Bank and the Company represent and acknowledge to the other that, subject
to the proviso included in this paragraph, upon an Early Unwind, all
obligations with respect to the Transaction shall be deemed fully and finally
discharged.

 

(j)                                     Dividends.
If at any time during the period from but excluding the Trade Date, to
and including the final Expiration Date, an ex-dividend date for a cash
dividend occurs with respect to the Shares (an “Ex-Dividend Date”),  and that dividend is greater than
the Regular Dividend on a per Share basis then the Calculation Agent shall
adjust the Strike Price, the Number of Warrants, the Daily Number of Warrants
and the Warrant Entitlement to preserve the fair value of the Warrants to Bank
after taking into account such dividend. “Regular Dividend”  shall mean USD 0.02 per Share per
quarter.

 

(k)                                  Role  of
Agent.  Each party agrees and acknowledges that (i) J.P. Morgan Securities
Inc. (“JPMSI”), an affiliate of JPMorgan Chase
Bank, National Association,
has acted solely as agent and not as principal with respect to this Transaction
and (ii) JPMSI has no obligation or liability, by way of guaranty,
endorsement or otherwise, in any manner in respect of the Transaction
(including, if applicable, in respect of the settlement thereof). Each party
agrees it will look solely to the other party (or any guarantor in respect
thereof) for performance of such other party’s obligations under the
Transaction.

 

(l)                                     Additional
Provisions.

 

(i)                                     The first
paragraph of Section 9.1(c) of the Equity Definitions is hereby
amended to read as follows: “(c) If “Calculation Agent Adjustment” is
specified as the method of adjustment in the Confirmation of a Share Option
Transaction, then following the declaration by the Issuer of the terms of any
Potential Adjustment Event, the Calculation Agent will determine whether such
Potential Adjustment Event has a material effect on the theoretical value of
the relevant Shares or Warrants and, if so, will (i) make 

 

11

 

appropriate adjustment(s),
if any, to any one or more of:’ and, the sentence immediately preceding Section 9.1(c)(ii) is
hereby amended by deleting the words “diluting or concentrative”.

 

(ii)                                Section 9.1(e)(vi) of
the Equity Definitions is hereby amended by deleting the words “other similar”
between “any” and “event”; deleting the words “diluting or concentrative” and
replacing them with “material”; and adding the following words at the end of
the sentence “or Warrants”.

 

(iii)                            Section 9.6(a)(ii) of
the Equity Definitions is hereby amended by (1) deleting from the third
line thereof the word “or” after the word “official” and inserting a comma
therefor, and (2) deleting the period at the end of subsection (ii) thereof
and inserting the following words therefor “or (C) at Bank’s option, the
occurrence of any of the events specified in Section 5(a)(vii)(1) through
(9) of the Agreement with respect to that Issuer.”

 

(iv)                              Notwithstanding
Section 9.7 of the Equity Definitions, everything in the first paragraph
of Section 9.7(b) of the Equity Definitions after the words “Calculation
Agent” in the third line through the remainder of such Section 9.7 shall
be deleted and replaced with the following:

 

“based on an amount
representing the Calculation Agent’s determination of the fair value to Buyer
of an option with terms that would preserve for Buyer the economic equivalent
of any payment or delivery (assuming satisfaction of each applicable condition
precedent) by the parties in respect of the relevant Transaction that would
have been required after that date but for the occurrence of the Option Value
Event.”

 

(v)                                 Notwithstanding
anything to the contrary in this Confirmation, upon the occurrence of one of
the following events, with respect to the Transaction or any portion of the
Transaction, (1) Bank shall have the right to designate such event as an
Additional Termination Event and designate an Early Termination Date pursuant
to Section 6(b) of the Agreement, and (2) the Company shall be
deemed the sole Affected Party and the Transaction or such portion of the
Transaction shall be deemed the sole Affected Transaction:

 

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

 

(B)                                Consummation of
(A) any recapitalization,
reclassification or change of the Shares (other than changes resulting from a
subdivision or combination) as a result of which the Shares would be converted
into, or exchanged for, stock, other securities, other property or assets or (B) any share
exchange, consolidation or merger of the Company pursuant to which the Shares
will be converted into cash, securities or other property or any conveyance,
transfer, sale, lease or other disposition in one transaction or a series of
transactions of all or substantially all of the consolidated assets of the
Company and its subsidiaries, taken as a whole, to any person other than one of
its subsidiaries; provided, however, that
a transaction where the holders of more than 50% of all classes of common
equity of the Company immediately prior to such transaction own, directly or
indirectly, more than 50% of all classes of common equity of the continuing or
surviving corporation or transferee immediately after such event shall not be an
Additional Termination Event;

 

12

 

(C)                                If (I) the
directors who were members of Company’s board of directors on the Trade Date or
(II) the directors who become members of Company’s board of directors
subsequent to that date and whose election, appointment or nomination for
election by Company stockholders is duly approved by a majority of the
continuing directors on Company’s board of directors at the time of such
approval, either by a specific vote or by approval of the proxy statement
issued by Company on behalf of its entire board of directors in which such
individual is named as nominee for director, cease to constitute at least a
majority of Company’s board of directors.

 

(D)                               The Company
defaults on any indebtedness with an original aggregate principal amount of at
least USD 125 million and such default results in any principal and interest on
such indebtedness becoming, or becoming capable at such time of being declared,
immediately due and payable.

 

(E)                                At any time
during the period from and including the Trade Date, to and including the final
Expiration Date, the Shares cease to be listed or quoted on the Exchange for
any reason (other than a Merger Event as a result of which the shares of common
stock underlying the Warrants are listed or quoted on the New York Stock
Exchange, the NASDAQ Global Market or the NASDAQ Global Select Market (or their
respective successors) (each, a “Successor Exchange”))  and are not immediately re-listed
or quoted as of the date of such de-listing on a Successor Exchange.

 

(F)                               On or after the
Trade Date, a Change in Law (as defined in the 2002 Equity Derivatives
Definitions as published by ISDA (the “2002 Definitions”),
with any reference in such definition to “Shares” being replaced with
references to “Hedge Position(s)” and without regard to clause (Y) of such
definition) shall have occurred.

 

Notwithstanding the
forgoing, a transaction set forth in clauses (A) or (B) above will
not constitute an Additional Termination Event if at least 90% of the
consideration, excluding cash payments for fractional shares, in such
transaction or transactions consists of shares of common stock listed on a
national securities exchange, including the New York Stock Exchange, which will
be so listed when issued or exchanged in connection with such transaction or
transactions.

 

For the avoidance of doubt, in determining the Close-out Amount
pursuant to Section 6(e) of the Agreement, the Determining Party
shall act in good faith and a commercially reasonable manner, and, upon
request, the Determining Party shall provide to the other party a statement
showing in reasonable detail, such calculations (including any quotations,
market data or information from internal sources used in making such calculation);
provided that the Determining Party
shall not be obligated to disclose any proprietary model used for such
calculation.

 

(m)                               No
Collateral or Setoff. Notwithstanding
any provision of the Agreement or any other agreement between the parties to
the contrary, the obligations of the Company hereunder are not secured by any
collateral. Each party waives any and all rights it may have to set-off
delivery or payment obligations it owes to the other party under the
Transaction against any delivery or payment obligations owed to it by the other
party, whether arising under the Agreement, under any other agreement between
the parties hereto, by operation of law or otherwise. Notwithstanding anything
to the contrary in the Equity Definitions, Bank shall have no obligation
hereunder or under the Agreement to make any delivery or payment to the
Company.

 

(n)                                 Alternative
Calculations and Payment on Early Termination and on Certain Extraordinary
Events. If, in respect of the Transaction, an amount is
payable by the Company to Bank, (i) pursuant to Section 9.7 of the
Equity Definitions or Section 12.3 of the 2002 Definitions (except in 

 

13

 

the event of a
Nationalization, Insolvency, Tender Offer or Merger Event, in each case, in
which the consideration to be paid to holders of Shares consists solely of
cash) or (ii) pursuant to Sections 6(d) and 6(e) of the
Agreement (except in the event of an Event of Default in which the Company is
the Defaulting Party or a Termination Event in which the Company is the
Affected Party, other than an Event of Default of the type described in Section 5(a)(iii),
(v), (vi), (vii) or (viii) of the Agreement or a Termination Event of
the type described in Section 5(b)(i), (ii), (iii), (iv), (v) or (vi) of
the Agreement in each case that resulted from an event or events outside the
Company’s control) (a “Payment Obligation”),  the Company may, in its sole
discretion, satisfy any such Payment Obligation by the Share Termination
Alternative (as defined below) and shall give irrevocable telephonic notice to
Bank, confirmed in writing within one Currency Business Day, no later than
12:00 p.m. New York local time on the Merger Date, the Tender Offer Date,
the date of the occurrence of the Nationalization or Insolvency, or Early
Termination Date, as applicable; provided that
if the Company does not validly elect to satisfy its Payment Obligation by the
Share Termination Alternative, Bank shall have the right to require the Company
to satisfy its Payment Obligation by the Share Termination Alternative,
notwithstanding the Company’s election to the contrary.

 

	
  Share
  Termination Alternative:

  	
   

  	
  Applicable
  and means that the Company shall deliver to Bank the Share Termination
  Delivery Property on the date (the “Share Termination Payment Date”)  when the Payment Obligation would
  otherwise be due, subject to paragraph (p)(i) below, in satisfaction,
  subject to paragraph (p)(ii) below, of the Payment Obligation in the
  manner reasonably requested by Bank free of payment.

  
	
   

  	
   

  	
   

  
	
  Share
  Termination Delivery Property:

  	
   

  	
  A
  number of Share Termination Delivery Units, as calculated by the Calculation
  Agent, equal to the Payment Obligation divided by the Share Termination Unit
  Price. The Calculation Agent shall adjust the Share Termination Delivery
  Property by replacing any fractional portion of a security therein with an
  amount of cash equal to the value of such fractional security based on the
  values used to calculate the Share Termination Unit Price.

  
	
   

  	
   

  	
   

  
	
  Share
  Termination Unit Price:

  	
   

  	
  The
  value to Bank of property contained in one Share Termination Delivery Unit on
  the date such Share Termination Delivery Units are to be delivered as Share
  Termination Delivery Property, as determined by the Calculation Agent in its
  discretion by commercially reasonable means and notified by the Calculation
  Agent to the Company at the time of notification of the Payment Obligation.
  In the case of a Private Placement of Share Termination Delivery Units that
  are Restricted Shares (as defined below) as set forth in paragraph
  (p)(i) below, the Share Termination Unit Price shall be determined by
  the discounted price applicable to such Share Termination Delivery Units. In
  the case of a Registration Settlement of Share Termination Delivery Units that
  are Restricted Shares (as defined below) as set forth in paragraph
  (p)(ii) below, the Share Termination Unit Price shall be the Settlement
  Price on the Merger Date, the Tender Offer Date, the date of the occurrence
  of the Nationalization or Insolvency, or Early Termination Date, as
  applicable.

  
	
   

  	
   

  	
   

  
	
  Share
  Termination Delivery Unit:

  	
   

  	
  In
  the case of a Termination Event or Event of Default, one Share or, in the
  case of Nationalization, Insolvency,

  

 

14

 

	
   

  	
   

  	
  Tender
  Offer or Merger Event, a unit consisting of the number or amount of each type
  of property received by a holder of one Share (without consideration of any
  requirement to pay cash or other consideration in lieu of fractional amounts
  of any securities) in such Nationalization, Insolvency, Tender Offer or
  Merger Event. If such Merger Event involves a choice of consideration to be
  received by holders, such holder shall be deemed to have elected to receive
  the maximum possible amount of cash.

  
	
   

  	
   

  	
   

  
	
  Failure
  to Deliver:

  	
   

  	
  Inapplicable

  
	
   

  	
   

  	
   

  
	
  Other
  applicable provisions:

  	
   

  	
  If
  Share Termination Alternative is applicable, the provisions of Sections 6.6,
  6.7, 6.8, 6.9 and 6.10 (as modified above) of the Equity Definitions will be
  applicable, except that all references in such provisions to
  “Physically-Settled” shall be read as references to “Share Termination
  Settled” and all references to “Shares” shall be read as references to “Share
  Termination Delivery Units”. “Share Termination Settled” in relation to the
  Transaction means that Share Termination Alternative is applicable to the
  Transaction.

  

 

(o)                                 Registration/Private
Placement Procedures. If, in the
reasonable opinion of Bank based upon advice of counsel, following any delivery
of Shares or Share Termination Delivery Property to Bank hereunder, such Shares
or Share Termination Delivery Property would be in the hands of Bank subject to
any applicable restrictions with respect to any registration or qualification
requirement or prospectus delivery requirement for such Shares or Share
Termination Delivery Property pursuant to any applicable federal or state
securities law (including, without limitation, any such requirement arising
under Section 5 of the Securities Act as a result of such Shares or Share
Termination Delivery Property being “restricted securities”, as such term is
defined in Rule 144 under the Securities Act, or as a result of the sale
of such Shares or Share Termination Delivery Property being subject to
paragraph (c) of Rule 145 under the Securities Act) (such Shares or
Share Termination Delivery Property, “Restricted Shares”),  then delivery of such Restricted
Shares shall be effected pursuant to either clause (i) or (ii) below
at the election of the Company, unless waived by Bank. Notwithstanding the
foregoing, solely in respect of any Daily Number of Warrants exercised or
deemed exercised on any Expiration Date, the Company shall elect, prior to the
first Settlement Date for the First Expiration Date, a Private Placement
Settlement or Registration Settlement for all deliveries of Restricted Shares
for all such Expiration Dates which election shall be applicable to all
Settlement Dates for such Daily Number of Warrants and the procedures in clause
(i) or clause (ii) below shall apply for all such delivered
Restricted Shares on an aggregate basis commencing after the final Settlement
Date for such Daily Number of Warrants. The Calculation Agent shall make
reasonable adjustments to settlement terms and provisions under this
Confirmation to reflect a single Private Placement or Registration Settlement
for such aggregate Restricted Shares delivered hereunder.

 

(i)                                     If the Company
elects to settle the Transaction pursuant to this clause (i) (a “Private
Placement Settlement”),  then
delivery of Restricted Shares by the Company shall be effected pursuant to
customary private placement procedures with respect to such Restricted Shares
of similar size in form and substance reasonably acceptable to Bank; provided that the Company may not elect a
Private Placement Settlement if, on the date of its election, it has taken, or
caused to be taken, any action that would make unavailable either the exemption
pursuant to Section 4(2) of the Securities Act for the sale by the
Company to Bank (or any affiliate designated by Bank) of the Restricted Shares
or the exemption pursuant to Section 4(1) or Section 4(3) of
the Securities Act for resales of the 

 

15

 

Restricted Shares by Bank
(or any such affiliate of Bank). The Private Placement Settlement of such
Restricted Shares shall include customary representations, covenants, blue sky
and other governmental filings and/or registrations, indemnities to Bank, due
diligence rights (for Bank or any designated buyer of the Restricted Shares by
Bank), opinions and certificates, and such other documentation as is customary
for private placement agreements with respect to companies of comparable size,
maturity and line of business, all reasonably acceptable to Bank. In the case
of a Private Placement Settlement, Bank shall determine the appropriate
discount to the Share Termination Unit Price (in the case of settlement of
Share Termination Delivery Units pursuant to paragraph (o) above) or any
Settlement Price (in the case of settlement of Shares pursuant to Section 2
above) applicable to such Restricted Shares in a commercially reasonable manner
and appropriately adjust the amount of such Restricted Shares to be delivered
to Bank hereunder; provided that
in no event such number shall be greater than 1.8 times the Number of Shares
(the “Maximum
Amount”).  Notwithstanding
the Agreement or this Confirmation, the date of delivery of such Restricted
Shares shall be the Exchange Business Day following notice by Bank to the
Company, of such applicable discount and the number of Restricted Shares to be
delivered pursuant to this clause (i). For the avoidance of doubt, delivery of
Restricted Shares shall be due as set forth in the previous sentence and not be
due on the Share Termination Payment Date (in the case of settlement of Share
Termination Delivery Units pursuant to paragraph (o) above) or on the
Settlement Date for such Restricted Shares (in the case of settlement in Shares
pursuant to Section 2 above).

 

(ii)                                If the Company
elects to settle the Transaction pursuant to this clause (ii) (a “Registration
Settlement”),  then
the Company shall promptly (but in any event no later than the beginning of the
Resale Period) file and use its reasonable best efforts to make effective under
the Securities Act a registration statement or supplement or amend an
outstanding registration statement in form and substance reasonably
satisfactory to Bank, to cover the resale of such Restricted Shares in
accordance with customary resale registration procedures, including covenants,
conditions, representations, underwriting discounts (if applicable),
commissions (if applicable), indemnities due diligence rights, opinions and
certificates, and such other documentation as is customary for equity resale
underwriting agreements with respect to companies of comparable size, maturity
and line of business, all reasonably acceptable to Bank. If Bank, in its sole
reasonable discretion, is not satisfied with such procedures and documentation
Private Placement Settlement shall apply. If Bank is satisfied with such
procedures and documentation, it shall sell the Restricted Shares pursuant to
such registration statement during a period (the “Resale Period”)  commencing on the Exchange Business
Day following delivery of such Restricted Shares (which, for the avoidance of
doubt, shall be (x) any Settlement Date in the case of an exercise of
Warrants prior to the First Expiration Date pursuant to Section 2 above, (y) the
Share Termination Payment Date in case of settlement in Share Termination
Delivery Units pursuant to paragraph (o) above or (z) the Settlement
Date in respect of the final Expiration Date for all Daily Number of Warrants)
and ending on the earliest of (i) the Exchange Business Day on which Bank
completes the sale of all Restricted Shares or, in the case of settlement of
Share Termination Delivery Units, a sufficient number of Restricted Shares so
that the realized net proceeds of such sales exceed the Payment Obligation (as
defined above), (ii) the date upon which all Restricted Shares have been
sold or transferred pursuant to Rule 144 (or similar provisions then in
force) or Rule 145(d)(2) (or any similar provision then in force)
under the Securities Act and (iii) the date upon which all Restricted
Shares may be sold or transferred by a non-affiliate pursuant to Rule 144
(or any similar provision then in force) or Rule 145(d)(2) (or any
similar provision then in force) under the Securities Act. If the Payment
Obligation exceeds the realized net proceeds from such resale, the Company
shall transfer to Bank by the open of the regular trading session on the
Exchange on the Exchange Trading Day immediately following the last day of the
Resale Period the amount of such excess (the “Additional Amount”)  in cash or in a number of Shares 

 

16

 

(“Make-whole Shares”)  in an amount that, based on
the Settlement Price on the last day of the Resale Period (as if such day was
the “Valuation Date” for purposes of computing such Settlement Price), has a
dollar value equal to the Additional Amount. The Resale Period shall continue
to enable the sale of the Make-whole Shares. If the Company elects to pay the
Additional Amount in Shares, the requirements and provisions for Registration
Settlement shall apply. This provision shall be applied successively until the
Additional Amount is equal to zero. In no event shall the Company deliver a
number of Restricted Shares greater than the Maximum Amount.

 

(iii)                             Without
limiting the generality of the foregoing, the Company agrees that any
Restricted Shares delivered to Bank, as purchaser of such Restricted Shares, (i) may
be transferred by and among Bank and its affiliates and the Company shall
effect such transfer without any further action by Bank and (ii) after the
period of 6 months from the Trade Date (or 1 year from the Trade Date if, at
such time, informational requirements of Rule 144(c) are not
satisfied with respect to the Company) has elapsed after any Settlement Date
for such Restricted Shares, the Company shall promptly remove, or cause the
transfer agent for such Restricted Shares to remove, any legends referring to
any such restrictions or requirements from such Restricted Shares upon request
by Bank (or such affiliate of Bank) to the Company or such transfer agent, without
any requirement for the delivery of any certificate, consent, agreement,
opinion of counsel, notice or any other document, any transfer tax stamps or
payment of any other amount or any other action by Bank (or such affiliate of
Bank).

 

If (x) the Company shall fail to
effectuate the Private Placement Settlement as set forth in clause (i) or (y) the
Company shall fail to effectuate the Registration Settlement as set forth in
clause (ii) and the Company shall fail to effectuate the Private Placement
Settlement following its failure to effectuate the Registration Settlement,
then either the failure set forth in clause (x) or the failure set forth
in clause (y) shall constitute an Event of Default with respect to which
the Company shall be the Defaulting Party.

 

(p)                                 Limit
on Beneficial Ownership. Notwithstanding
anything to the contrary in the Agreement or this Confirmation, Bank may not exercise any Warrant hereunder, have the “right
to acquire” (within the meaning of NYSE Rule 312.04(g)) Shares upon exercise
of any Warrant hereunder or be entitled to take delivery of any Shares
deliverable hereunder, and Automatic Exercise shall not apply with respect to
any Warrant hereunder if, upon receipt of such Shares, (i) the Share Amount would
exceed the Post-Effective Limit, or (ii) the “beneficial ownership” (within the meaning of Section 13 or Section 16
of the Exchange Act and the rules promulgated thereunder) of Shares by
Bank Group would be equal to or greater than the lesser of (A) 4.5% of the
then outstanding Shares and (B) 12,013,276 Shares (the “Threshold Number of Shares”).  Any
purported delivery hereunder shall be void and have no effect to the extent
(but only to the extent) that, after such delivery, (i) the Share Amount
would exceed the Post-Effective Limit, or (ii) Bank Group would directly
or indirectly so beneficially own in excess of the Threshold Number of
Shares.  If any delivery owed to Bank
hereunder is not made, in whole or in part, as a result of this provision, the
Company’s obligation to make such delivery shall not be extinguished and the
Company shall make such delivery as promptly as practicable after, but in no
event later than one Exchange Business Day after, Bank gives notice to the
Company that such delivery would not result in (i) the Share Amount
exceeding the Post-Effective Limit, or (ii) Bank Group directly or
indirectly beneficially owning in excess of the Threshold Number of Shares.

 

(q)                                 Share
Deliveries. The Company acknowledges and
agrees that, to the extent the holder of this Warrant is not then an affiliate
and has not been an affiliate for 90 days (it being understood that Bank will
not be considered an affiliate under this paragraph solely by reason of its
receipt of Shares pursuant to the Transaction), and otherwise satisfies all
holding period and other requirements of Rule 144 of the Securities Act
applicable to it, any delivery of Shares or Share Termination Delivery Property
hereunder at any time after 6 months from the Trade Date (or 1 year from the
Trade Date if, at such time, informational requirements of Rule 144(c) are
not 

 

17

 

satisfied with respect to
the Company) shall be eligible for resale under Rule 144 of the Securities
Act and the Company agrees to promptly remove, or cause the transfer agent for
such Shares or Share Termination Delivery Property, to remove, any legends
referring to any restrictions on resale under the Securities Act from the
Shares or Share Termination Property. The Company further agrees that any
delivery of Shares or Share Termination Delivery Property prior to the date
that is 6 months from the Trade Date (or 1 year from the Trade Date if, at such
time, informational requirements of Rule 144(c) are not satisfied
with respect to the Company), may be transferred by and among Bank and its
affiliates and the Company shall effect such transfer without any further
action by Bank. Notwithstanding anything to the contrary herein, the Company
agrees that any delivery of Shares or Share Termination Delivery Property shall
be effected by book-entry transfer through the facilities of DTC, or any
successor depositary, if at the time of delivery, such class of Shares or class
of Share Termination Delivery Property is in book-entry form at DTC or such
successor depositary. Notwithstanding anything to the contrary herein, to the
extent the provisions of Rule 144 of the Securities Act or any successor rule are
amended, or the applicable interpretation thereof by the Securities and
Exchange Commission or any court change after the Trade Date, the agreements of
the Company herein shall be deemed modified to the extent necessary, in the
opinion of outside counsel of the Company, to comply with Rule 144 of the
Securities Act, as in effect at the time of delivery of the relevant Shares or
Share Termination Property.

 

(r)                                    Hedging
Disruption Event. The occurrence
of a Hedging Disruption Event will constitute an Additional Termination Event
under the Agreement permitting Bank to terminate the Transaction or any portion
of the Transaction, with the Company as the sole Affected Party and the
Transaction or such portion of the Transaction as the sole Affected
Transaction.

 

“Hedging Disruption Event”  means with respect to Bank,
as determined in its reasonable discretion, the inability or impracticality,
due to market illiquidity, illegality, lack of hedging transactions or credit
worthy market participants or other similar events, to establish, re-establish
or maintain any transactions necessary or advisable to hedge, directly or
indirectly, the equity price risk of entering into and performing under the
Transaction on terms including costs reasonable to Bank or an affiliate in its
reasonable discretion, including (x) the event that at any time Bank
reasonably concludes that it or any of its affiliates are unable to establish,
re-establish or maintain a full hedge of its position in respect of the
Transaction through share borrowing arrangements on terms including costs
deemed reasonable to Bank in its reasonable discretion and (y) the event
where upon Bank or its affiliate would incur a materially increased cost in
establishing, re-establishing or maintaining a full hedge of the equity price
risk (including without limitation the volatility risk) in respect of the
Transaction directly or indirectly as a result of actions taken by the Company.
For the avoidance of doubt, the parties hereto agree that if (i) Bank
reasonably determines that it is unable to borrow Shares to hedge its exposure
with respect to the Transaction at a rate of borrowing that is less than 100
basis points or (ii) Bank, in its good faith reasonable judgment,
determines that it cannot hedge its obligations pursuant to the Transaction in
the public market without registration under the Securities Act or as a result
of any legal, regulatory or self-regulatory requirements or related policies
and procedures (whether or not such requirements, policies or procedures are
imposed by law or have been voluntarily adopted by Bank), an Additional
Termination Event under the Agreement shall occur with the Company as the sole
Affected Party and the Transaction as the sole Affected Transaction.

 

(s)                                  Maximum
Share Delivery. Notwithstanding
any other provision of this Confirmation, the Agreement or the Equity
Definitions, in no event will the Company be required to deliver more than the
Maximum Amount of Shares in the aggregate to Bank in connection with the
Transaction, subject to the provisions below regarding Deficit Shares.  In the event the Company shall not have
delivered the full number of Shares otherwise due in connection with the
Transaction as a result of the first sentence of this paragraph relating to the
Maximum Amount (such deficit, the “Deficit Shares”),
the Company shall be continually obligated to deliver, from time to time until
the full number of Deficit Shares have been delivered pursuant to this
paragraph, Shares when, and to the extent, that (i) Shares are
repurchased, acquired or otherwise received by the Company or any of 

 

18

 

its subsidiaries after the
Trade Date (whether or not in exchange for cash, fair value or any other
consideration), (ii) authorized and unissued Shares reserved for issuance
in respect of other transactions prior to such date which prior to the relevant
delivery date become no longer so reserved and (iii) the Company
additionally authorizes any unissued Shares that are not reserved for other
transactions. The Company shall immediately notify Bank of the occurrence of
any of the foregoing events (including the aggregate number of Shares subject
to clause (i), (ii) or (iii) and the corresponding number of Shares
to be delivered) and promptly deliver the Applicable Percentage of such
aggregate number of Shares thereafter.

 

(t)                                    Right
to Extend. Bank may postpone, in whole
or in part, any Expiration Date or any other date of valuation or delivery with
respect to some or all of the relevant Warrants (in which event the Calculation
Agent shall make appropriate adjustments to the Daily Number of Warrants with
respect to one or more Expiration Dates) if Bank determines, in its
commercially reasonable judgment, that such extension is reasonably necessary
or appropriate to preserve Bank’s hedging or hedge unwind activity hereunder in
light of existing liquidity conditions or to enable Bank to effect purchases of
Shares in connection with its hedging, hedge unwind or settlement activity
hereunder in a manner that would, if Bank were Issuer or an affiliated
purchaser of Issuer, be in compliance with applicable legal, regulatory or
self-regulatory requirements, or with related policies and procedures
applicable to Bank.

 

(u)                                 Status
of Claims in Bankruptcy. Bank
acknowledges and agrees that this Confirmation is not intended to convey to
Bank rights with respect to the Transaction that are senior to the claims of
common stockholders of the Company in any U.S. bankruptcy proceedings of the
Company; provided that nothing
herein shall limit or shall be deemed to limit Bank’s right to pursue remedies
in the event of a breach by the Company of its obligations and agreements with
respect to the Transaction; provided,
further, that nothing herein shall limit or shall be deemed to limit
Bank’s rights in respect of any transactions other than the Transaction.

 

(v)                                 Governing
Law; Exclusive Jurisdiction. For the Agreement and this
Confirmation, New York law (without reference to choice of law doctrine to the
extent inconsistent with choice of New York law).  Section 13(b) of the Agreement is
hereby amended by (i) deleting the words “non-exclusive” in Section 13(b)(i)(2) and
replacing them with the word “exclusive”, and (ii)  inserting after the
word “law” in Section 13(b)(iii) the words “and subject to Section 13(b)(i)(2)”.

 

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

 

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

 

(y)                                 Securities
Contract; Swap Agreement. The parties
hereto intend for:  (a) the
Transaction to be a “securities contract” and a “swap agreement” and the
Agreement to be a “master netting agreement”, in each case as defined in the
Bankruptcy Code (Title 11 of the United States Code) (the “Bankruptcy
Code”), and the parties hereto to be entitled to the protections
afforded by, among other Sections, Sections 362(b)(6), 362(b)(7), 362(b)(27),
362(o), 546(e), 546(g), 555 and546(j), 548(d)(2), 555, 560 and 561 of the
Bankruptcy Code; (b) a party’s right to liquidate the Transaction and to
exercise any other remedies upon the occurrence of any Event of Default or
Termination Event under the Agreement with respect to the other party or any
Extraordinary Event 

 

19

 

that results in the
termination or cancellation of any Transaction to constitute a “contractual
right” as described in the Bankruptcy Code; and (c) each payment and
delivery of cash, securities or other property hereunder to constitute a “margin
payment” or “settlement payment” and a “transfer” as defined in the Bankruptcy
Code.

 

20

 

Please confirm that
the foregoing correctly sets forth the terms of our agreement by executing this
Confirmation and returning it to EDG Confirmation Group, J.P. Morgan Securities
Inc., 277 Park Avenue, 11th Floor, New York, NY 10172-3401, or by fax to (212) 622 8519.

 

 

	
   

  	
   

  	
  Very truly yours,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  J.P.
  MORGAN SECURITIES INC., as agent for JPMORGAN CHASE BANK, NATIONAL
  ASSOCIATION

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Michael O’Donovan

  
	
   

  	
   

  	
   

  	
  Authorized
  Signatory

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Accepted and confirmed

  	
   

  	
   

  
	
  as of the Trade Date:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  TEXTRON INC.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By: 

  	
  /s/ Mary F. Lovejoy

  	
   

  	
   

  
	
  Authorized Signatory

  	
   

  	
   

  
	
  Name: Mary F. Lovejoy

  	
   

  	
   

  
						

 

 

JPMorgan Chase Bank, National Association

Organised under the laws of the United States as a National Banking
Association

Main Office 1111 Polaris Parkway, Columbus, Ohio 43271

Registered as a branch in England & Wales branch No. BR000746

Registered Branch Office 125 London Wall, London EC2Y 5AJ

Authorised and regulated by the Financial Services Authority

 

 

Schedule A

 

For each Expiration Date, the Daily Number of
Warrants is set forth below.

 

	
  Expiration Date

  	
   

  	
  Daily Number of Warrants

  	
   

  
	
  August 1, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 2, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 5, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 6, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 7, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 8, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 9, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 12, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 13, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 14, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 15, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 16, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 19, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 20, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 21, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 22, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 23, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 26, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 27, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 28, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 29, 2013

  	
   

  	
  457,143

  	
   

  
	
  August 30, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 3, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 4, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 5, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 6, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 9, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 10, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 11, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 12, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 13, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 16, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 17, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 18, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 19, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 20, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 23, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 24, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 25, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 26, 2013

  	
   

  	
  457,143

  	
   

  
	
  September 27, 2013

  	
   

  	
  457,143

  	
   

  

 

A-1

 

	
  Expiration Date

  	
   

  	
  Daily Number of Warrants

  	
   

  
	
  September 30, 2013

  	
   

  	
  457,143

  	
   

  
	
  October 1, 2013

  	
   

  	
  457,143

  	
   

  
	
  October 2, 2013

  	
   

  	
  457,143

  	
   

  
	
  October 3, 2013

  	
   

  	
  457,143

  	
   

  

 

A-2Exhibit 10.5

 

Goldman,
Sachs & Co.

One
New York Plaza

New
York, NY 10004

 

April 30,
2009

To: Textron Inc.

40
Westminster Street

Providence,
RI 02903

Attention:
Chief Financial Officer

Telephone No.:     (401) 421-2800

Facsimile
No.:       (401) 457-3533

 

 

	
  Re:

  	
   

  	
  Additional Convertible Bond
  Hedge Transaction

  
	
  A/C:

  	
   

  	
  028320281

  
	
  Ref. No.:

  	
   

  	
  SDB1630442183

  

 

The purpose of this letter agreement (this “Confirmation”) is to confirm the terms and conditions of the
Transaction entered into between Goldman, Sachs & Co. (“Bank”) and Textron Inc. (“Counterparty”)
on the Trade Date specified below (the “Transaction”).
This letter agreement constitutes a “Confirmation”
as referred to in the ISDA Master Agreement specified below. This Confirmation
shall replace any previous agreements and serve as the final documentation for
the Transaction.

 

The definitions and provisions contained in
the 1996 ISDA Equity Derivatives Definitions (the “Equity
Definitions”), as
published by the International Swaps and Derivatives Association, Inc. (“ISDA”), are incorporated into this Confirmation. In the
event of any inconsistency between the Equity Definitions and this
Confirmation, this Confirmation shall govern. Certain defined terms used herein
have the meanings assigned to them in the Prospectus dated July 28, 2008,
as supplemented by the Prospectus Supplement dated April 29, 2009 (as so
supplemented, the “Prospectus”),
relating to the USD 540,000,000 principal amount of 4.50% Convertible Senior
Notes due 2013, (the “Convertible Notes”
and each USD 1,000 principal amount of Convertible Notes, a “Convertible Note”) issued by Counterparty pursuant to an
Indenture dated as of September 10, 1999, as supplemented by the
Supplemental Indenture (the “Supplemental Indenture”)
thereto to be dated May 5, 2009, between Counterparty and The Bank of New
York Mellon Trust Company, N.A., as trustee (as so supplemented, the “Indenture”). In the event of any inconsistency between the
terms defined in the Prospectus, the Indenture and this Confirmation, this
Confirmation shall govern. The parties acknowledge that this Confirmation is
entered into on the date hereof with the understanding that (i) definitions
set forth in the Indenture which are also defined herein by reference to the
Indenture and (ii) sections of the Indenture that are referred to herein
will conform to the descriptions thereof in the Prospectus. If any such
definitions in the Indenture or any such sections of the Indenture differ from
the descriptions thereof in the Prospectus, the descriptions thereof in the
Prospectus will govern for purposes of this Confirmation. The parties further
acknowledge that the Supplemental Indenture section numbers used herein are
based on the draft of the Supplemental Indenture last reviewed by Bank as of
the date of this Confirmation, and if any such section numbers are changed in
the Supplemental Indenture as executed, the parties will amend this
Confirmation in good faith to preserve the intent of the parties. For the
avoidance of doubt, references to the Indenture herein are references to the
Indenture as in effect on the date of its execution and if the Indenture is
amended following its execution, any such amendment will be disregarded for
purposes of this Confirmation unless the parties agree otherwise in writing.

 

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

 

1.               This
Confirmation evidences a complete and binding agreement between Bank and
Counterparty as to the terms of the Transaction to which this Confirmation
relates. This Confirmation shall supplement, form a part of, and 

 

1

 

be
subject to an agreement in the form of the 2002 ISDA Master Agreement (the “Agreement”) as if Bank and Counterparty had
executed an agreement in such form (but without any Schedule) on the Trade
Date. In the event of any inconsistency between provisions of that Agreement
and this Confirmation, this Confirmation will prevail for the purpose of the
Transaction to which this Confirmation relates. The parties hereby agree that
no Transaction other than the Transaction to which this Confirmation relates
shall be governed by the Agreement.

 

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

 

	
  General
  Terms:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Trade Date:

  	
   

  	
  April 30, 2009

  
	
   

  	
   

  	
   

  
	
  Option Style:

  	
   

  	
  “Modified American”, as
  set forth under “Exercise and Valuation” below

  
	
   

  	
   

  	
   

  
	
  Option Type:

  	
   

  	
  Call

  
	
   

  	
   

  	
   

  
	
  Buyer:

  	
   

  	
  Counterparty

  
	
   

  	
   

  	
   

  
	
  Seller:

  	
   

  	
  Bank

  
	
   

  	
   

  	
   

  
	
  Shares:

  	
   

  	
  The common stock of Counterparty, par value USD
  0.125 per Share (Exchange symbol “TXT”)

  
	
   

  	
   

  	
   

  
	
  Number of Options:

  	
   

  	
  The number of “Option
  Securities” (as defined in the Underwriting Agreement (as defined below)) in
  denominations of USD 1,000 principal amount purchased by the
  Underwriters pursuant to the Underwriting Agreement on the “Option Closing
  Date” (as defined in the Underwriting Agreement) for such Option Securities
  (the “Option Closing Date”). For the
  avoidance of doubt, the Number of Options outstanding shall be reduced by
  each exercise of Options hereunder. In no event will the Number of Options be
  less than zero.

  
	
   

  	
   

  	
   

  
	
  Option Entitlement:

  	
   

  	
  As of any date, a number
  of Shares per Option equal to the Conversion Rate (as defined in the
  Supplemental Indenture, but without regard to any adjustments to the Conversion
  Rate pursuant to Section 9.03 or to Section 9.04(g) or
  (h) of the Supplemental Indenture), for each Convertible Note.

  
	
   

  	
   

  	
   

  
	
  Strike Price:

  	
   

  	
  As of any date, an amount
  in USD, rounded to the nearest cent (with 0.5 cents being rounded upwards),
  equal to USD 1,000 divided by
  the Option Entitlement.

  
	
   

  	
   

  	
   

  
	
  Applicable Percentage:

  	
   

  	
  50%

  
	
   

  	
   

  	
   

  
	
  Number of Shares:

  	
   

  	
  The product of the Number
  of Options and the Option Entitlement and the Applicable Percentage.

  
	
   

  	
   

  	
   

  
	
  Premium:

  	
   

  	
  USD 7,400,400

  
	
   

  	
   

  	
   

  
	
  Premium Payment Date:

  	
   

  	
  May 5, 2009

  

 

2

 

	
  Exchange:

  	
   

  	
  The New York Stock
  Exchange

  
	
   

  	
   

  	
   

  
	
  Related Exchange(s):

  	
   

  	
  The principal
  exchange(s) for options contracts or futures contracts, if any, with
  respect to the Shares

  
	
   

  	
   

  	
   

  
	
  Exercise
  and Valuation:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Exercise Date:

  	
   

  	
  Each Conversion Date.

  
	
   

  	
   

  	
   

  
	
  Conversion Date:

  	
   

  	
  Each “Conversion Date” (as
  defined in the Supplemental Indenture) for Convertible Notes.

  
	
   

  	
   

  	
   

  
	
  Relevant Convertible Notes:

  	
   

  	
  For any Conversion Date, a
  number of Convertible Notes equal to (i) the number of Convertible Notes
  in denominations of USD 1,000 principal amount submitted for conversion
  on such Conversion Date in accordance with the terms of the Indenture, minus (ii) the number of “Relevant Convertible Notes”
  (as defined in the Convertible Bond Hedge Transaction Confirmation dated
  April 29, 2009 between Bank and Counterparty (the “Initial
  Convertible Bond Hedge Confirmation”)) for such Conversion Date,
  if any; provided that if such number is less
  than zero, the number of Relevant Convertible Notes for such Conversion Date
  shall be zero.

  
	
   

  	
   

  	
   

  
	
  Required Exercise on Conversion Dates:

  	
   

  	
  On each Conversion Date
  for Convertible Notes, a number of Options (the “Exercisable
  Options”) equal to the number of Relevant Convertible Notes for
  such Conversion Date shall be automatically exercised, subject to Notice of
  Exercise and Notice of Settlement Method below.

  
	
   

  	
   

  	
   

  
	
  Exercise Period:

  	
   

  	
  The period from and
  excluding the Trade Date to and including the Expiration Date.

  
	
   

  	
   

  	
   

  
	
  Expiration Date:

  	
   

  	
  The earlier of
  (x) the last day on which any Convertible Notes remain outstanding and
  (y) the maturity date of the Convertible Notes (the “Convertible Maturity Date”).

  
	
   

  	
   

  	
   

  
	
  Scheduled Trading Day:

  	
   

  	
  As such term is defined in
  Section 1.02 of the Supplemental Indenture.

  
	
   

  	
   

  	
   

  
	
  Notice of Exercise:

  	
   

  	
  Notwithstanding anything
  to the contrary in the Equity Definitions, in order to exercise any Options,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (a)  if Physical
  Settlement applies, Counterparty must notify Bank in writing before
  5:00 p.m. (New York City time) on the second Scheduled Trading Day
  immediately following the Conversion Date for the Relevant Convertible Notes,
  which notice shall specify (i) the number of Exercisable Options and
  (ii) the Conversion Date; and

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (b)  if Low Cash
  Combination Settlement, High Cash Combination Settlement or Cash Settlement
  applies, Counterparty must notify Bank in writing before 5:00 p.m. (New
  York City time) on the Scheduled Trading Day immediately preceding the
  scheduled first day of the 

  

 

3

 

	
   

  	
   

  	
  Settlement Period (as
  defined in the Supplemental Indenture) for the Relevant Convertible Notes,
  which notice shall specify (i) the number of Exercisable Options,
  (ii) the scheduled first day of the Settlement Period, and (iii) if
  Low Cash Combination Settlement or High Cash Combination Settlement applies,
  the fixed dollar amount per USD 1,000 of the principal amount of the Notes
  specified by Counterparty pursuant to Section 9.02(b)(3)(A) of the
  Supplemental Indenture (the “Specified Cash Amount”);

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  provided that with
  respect to Options relating to Relevant Convertible Notes with a Conversion
  Date on or following the fiftieth (50th) Scheduled Trading Day prior to the
  Convertible Maturity Date (the “Final Conversion Period”),
  such Notice of Exercise need only specify the number of Options being
  exercised and the Specified Cash Amount, if applicable.

  
	
   

  	
   

  	
   

  
	
  Settlement
  Terms:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Physical Settlement:

  	
   

  	
  Notwithstanding anything
  to the contrary in the Equity Definitions, means that Counterparty has
  elected to deliver only Shares to satisfy the Conversion Obligation (as
  defined in the Supplemental Indenture) in connection with the conversion of
  the Relevant Convertible Notes.

  
	
   

  	
   

  	
   

  
	
  Low Cash Combination Settlement:

  	
   

  	
  Means that (i) Counterparty
  has elected to deliver a combination of Shares and cash to satisfy the
  Conversion Obligation in connection with the conversion of the Relevant
  Convertible Notes and (ii) the Specified Cash Amount with respect to
  such conversion is equal to or less than USD 1,000.

  
	
   

  	
   

  	
   

  
	
  High Cash Combination Settlement:

  	
   

  	
  Means that
  (i) Counterparty has elected to deliver a combination of Shares and cash
  to satisfy the Conversion Obligation in connection with the conversion of the
  Relevant Convertible Notes and (ii) the Specified Cash Amount with
  respect to such conversion is greater than USD 1,000.

  
	
   

  	
   

  	
   

  
	
  Cash Settlement:

  	
   

  	
  Notwithstanding anything
  to the contrary in the Equity Definitions, means that Counterparty has
  elected to deliver only cash to satisfy the Conversion Obligation in
  connection with the conversion of the Relevant Convertible Notes.

  
	
   

  	
   

  	
   

  
	
  Notice of Settlement Method:

  	
   

  	
  Counterparty initially
  elects Low Cash Combination Settlement to settle its Conversion Obligation
  (as defined in the Supplemental Indenture). If Counterparty chooses to elect
  a different method of settlement, Counterparty must notify Bank of the newly
  chosen settlement method no later than the earlier of (i) 5:00 p.m.
  (New York City time) on the second Scheduled Trading Day immediately following
  the Conversion Date for the Relevant Convertible Notes to which the newly
  chosen settlement method is going to apply and (ii) 5:00 p.m. (New
  York City time) on the Scheduled Trading Day immediately preceding the Final
  Conversion Period; provided that
  it shall be a condition to Counterparty’s election of any such newly chosen
  settlement method that at the time of such election each

  

 

4

 

	
   

  	
   

  	
  of Counterparty and its
  affiliates is not, and Counterparty hereby represents and covenants that at
  such time neither of them will be, in possession of any material non-public
  information with respect to Counterparty or the Shares.

  
	
   

  	
   

  	
   

  
	
  Settlement Date:

  	
   

  	
  Subject to the delivery of
  a Notice of Exercise and, to the extent applicable, a Notice of Settlement
  Method, to Bank, the date Shares and/or cash are required to be delivered
  with respect to the Relevant Convertible Notes under the terms of the
  Indenture.

  
	
   

  	
   

  	
   

  
	
  Delivery Obligation:

  	
   

  	
  In lieu of the obligations
  set forth in Sections 5.1 and 6.1 of the Equity Definitions, and subject to
  Notice of Exercise and Notice of Settlement Method above, in respect of an
  Exercise Date, Bank will deliver to Counterparty, on the related Settlement
  Date,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (a)  if Physical
  Settlement or Low Cash Combination Settlement applies, a number of Shares
  equal to the product of the Applicable Percentage and the aggregate number of
  Shares (and cash in lieu of fractional Shares, if any, resulting from
  rounding of such aggregate number of Shares based on the VWAP (as defined in
  the Supplemental Indenture) on the Conversion Date) that Counterparty would
  have been obligated to deliver to the holder(s) of the Relevant
  Convertible Notes had Counterparty elected to deliver a combination of Shares
  and cash to satisfy the Conversion Obligation pursuant to
  Section 9.02(b) of the Supplemental Indenture and with a Specified
  Cash Amount of USD 1,000, as determined by the Calculation Agent; provided that, in the case of Physical Settlement, the
  number of Shares delivered by Bank to Counterparty on the related Settlement
  Date shall not be greater than the product of (i) the Applicable
  Percentage and (ii) the excess of (x) the aggregate number of
  Shares that Counterparty is obligated to deliver to the holder(s) of the
  Relevant Convertible Notes pursuant to Section 9.02(b)(1) of the
  Supplemental Indenture over (y) the number of Shares equal to
  (a) the aggregate principal amount of the Relevant Convertible Notes divided by (b) the Last Reported Sale Price (as
  defined in the Supplemental Indenture) on the final Settlement Period Trading
  Day (as defined in the Supplemental Indenture) of the applicable Settlement
  Period as if Counterparty elected Low Cash Combination Settlement;

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (b)  if High Cash
  Combination Settlement applies, (i) a number of Shares equal to the
  product of the Applicable Percentage and the aggregate number of Shares that
  Counterparty is obligated to deliver to the holder(s) of the Relevant
  Convertible Notes pursuant to Section 9.02(b)(3) of the Supplemental
  Indenture and (ii) an amount of cash equal to the product of the
  Applicable Percentage and the excess, if any, of (A) the amount of cash
  (including cash in lieu of fractional Shares, if any, resulting from rounding
  of such aggregate number of Shares based on the VWAP (as defined in the
  Supplemental Indenture and subject to the third immediately 

  

 

5

 

	
   

  	
   

  	
  following paragraph) on
  the last day of the relevant Settlement Period) that Counterparty is
  obligated to deliver to the holder(s) of the Relevant Convertible Notes
  pursuant to Section 9.02(b)(3) of the Supplemental Indenture over
  (B) the principal amount of the Relevant Convertible Notes being
  converted on such Conversion Date; and

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (c)  if Cash Settlement
  Applies, an amount equal to the product of the Applicable Percentage and the
  excess, if any, of (i) the cash that Counterparty is obligated to
  deliver to the holder(s) of the Relevant Convertible Notes pursuant to
  Section 9.02(b)(2) of the Supplemental Indenture over (ii) the
  principal amount of the Relevant Convertible Notes being converted on such
  Conversion Date (in each case, such Shares and/or cash collectively, the “Convertible Obligation”);

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  provided that, in all
  cases, the Delivery Obligation shall be determined excluding any Shares or
  cash (including cash in lieu of fractional Shares) that Counterparty is
  obligated to deliver to holder(s) of the Relevant Convertible Notes as a
  direct or indirect result of any adjustments to the Conversion Rate pursuant
  to Section 9.03 or Section 9.04(g) or (h) of the
  Supplemental Indenture and any interest payment that Counterparty is
  obligated to deliver to holder(s) of the Relevant Convertible Notes. For
  the avoidance of doubt, in connection with each Exercise Date, if the Daily
  Conversion Value (as defined in the Supplemental Indenture) for each of the
  Settlement Period Trading Days (as defined in the Supplemental Indenture)
  occurring in the relevant Settlement Period that would be applicable if cash settlement
  applied, is less than or equal to 1/45th of USD 1,000, Bank will have no
  delivery obligation hereunder in respect of such Exercise Date.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Counterparty agrees that
  if, with respect to any Settlement Period Trading Day during any relevant Settlement
  Period, the per share volume-weighted average price as displayed under the
  heading “Bloomberg VWAP” on Bloomberg page TXT.N <equity> AQR is
  unavailable, Counterparty and the nationally recognized independent
  investment banking firm retained by Counterparty pursuant to the definition
  of VWAP in the Indenture shall consult with the Calculation Agent to
  determine the VWAP on such Settlement Period Trading Day.

  
	
   

  	
   

  	
   

  
	
  Notice of Delivery Obligation:

  	
   

  	
  As applicable and no later
  than the later of (a) the relevant Exercise Date and (b) the
  Exchange Business Day immediately following the last day of the Settlement
  Period, Counterparty shall give Bank notice of the final number of Shares
  and/or the amount of cash comprising the relevant Convertible Obligation; provided that, with respect to any Exercise Date occurring
  during the Final Conversion Period, Counterparty may provide Bank with a
  single notice of the aggregate number of Shares and/or the amount of cash
  comprising the Convertible Obligations for all such Exercise Dates (it being
  understood, for the avoidance of doubt, that the requirement of Counterparty
  to deliver such notice shall not limit 

  

 

6

 

	
   

  	
   

  	
  Counterparty’s obligations
  with respect to Notice of Exercise, as set forth above, in any way).

  
	
   

  	
   

  	
   

  
	
  Settlement Currency:

  	
   

  	
  USD

  
	
   

  	
   

  	
   

  
	
  Other Applicable Provisions:

  	
   

  	
  The provisions of Sections
  6.6, 6.7, 6.8, 6.9 and 6.10 of the Equity Definitions will be applicable,
  except that all references in such provisions to “Physically-Settled” shall
  be read as references to “Low Cash Combination Settled” or “High Cash
  Combination Settled” to the extent Low Cash Combination Settlement or High
  Cash Combination Settlement is applicable. “Low Cash Combination Settled” or
  “High Cash Combination Settled” in relation to any Option means that Low Cash
  Combination Settlement or High Cash Combination Settlement is applicable to
  that Option.

  
	
   

  	
   

  	
   

  
	
  Failure to Deliver:

  	
   

  	
  Applicable

  
	
   

  	
   

  	
   

  
	
  3.   Additional Terms applicable to the Transaction:

  
	
   

  	
   

  	
   

  
	
  Adjustments applicable to the Transaction:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Potential Adjustment Events:

  	
   

  	
  Notwithstanding
  Section 9.1(e) of the Equity Definitions, a “Potential
  Adjustment Event” means any occurrence of any event or condition,
  as set forth in Section 9.04 of the Supplemental Indenture that would
  result in an adjustment to the Conversion Rate of the Convertible Notes; provided that in no event shall there be any adjustment
  hereunder as a result of an adjustment to the Conversion Rate pursuant to
  Section 9.03 or Section 9.04(g) or (h) of the
  Supplemental Indenture.

  
	
   

  	
   

  	
   

  
	
  Method of Adjustment:

  	
   

  	
  Calculation Agent
  Adjustment, and means that, notwithstanding Section 9.1(c) of the
  Equity Definitions, upon any adjustment to the Conversion Rate of the
  Convertible Notes pursuant to the Indenture (other than Section 9.03 and
  Sections 9.04(g) and (h) of the Supplemental Indenture), the
  Calculation Agent will make a corresponding adjustment to any one or more of
  the Strike Price, Number of Options, the Option Entitlement and any other
  variable relevant to the exercise, settlement or payment for the Transaction.

  
	
   

  	
   

  	
   

  
	
  Extraordinary
  Events applicable to the Transaction:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Merger Events:

  	
   

  	
  Notwithstanding
  Section 9.2(a) of the Equity Definitions, a “Merger
  Event” means the occurrence of any event or condition set forth in
  Section 9.05 of the Supplemental Indenture.

  
	
   

  	
   

  	
   

  
	
  Consequence of Merger Events:

  	
   

  	
  Notwithstanding
  Section 9.3 of the Equity Definitions, upon the occurrence of a Merger
  Event, the Calculation Agent shall make a corresponding adjustment in respect
  of any adjustment under the Indenture to any one or more of the nature of the
  Shares, Strike Price, Number of Options, the Option

  

 

7

 

	
   

  	
   

  	
  Entitlement and any other
  variable relevant to the exercise, settlement or payment for the Transaction;
  provided however that such adjustment
  shall be made without regard to any adjustment to the Conversion Rate for the
  issuance of additional shares as set forth in Section 9.03 of the
  Supplemental Indenture.

  
	
   

  	
   

  	
   

  
	
  Nationalization and Insolvency:

  	
   

  	
  Cancellation and Payment

  
	
   

  	
   

  	
   

  
	
  4.   Calculation
  Agent:

  	
   

  	
  Bank; provided
  that all determinations made by the Calculation Agent shall be made in good
  faith and in a commercially reasonable manner. Following any calculation by
  the Calculation Agent hereunder and a prior written request by Counterparty,
  the Calculation Agent will provide to Counterparty by e-mail to the e-mail
  address provided by Counterparty in such prior written request a report (in a
  commonly used file format for the storage and manipulation of financial data)
  displaying in reasonable detail the basis for such calculation. For the
  avoidance of doubt, nothing in this provision will require Bank to provide
  its proprietary models to Counterparty.

  

 

5.               Account Details

 

(a)                                  Account for
payments to Counterparty:

 

JPMorgan
Chase

New
York, NY

Fed
Wire:  021000021

Swift
/ BIC:  CHASUS33

CHIP
No:  0002

CHIP
UID:  280099

Account
name:  Textron Inc.

Account
No:  9101013655

 

Account for delivery of
Shares to Counterparty:

 

To be provided by
Counterparty

 

(b)                                 Account for
payments to Bank:

 

Chase Manhattan Bank New York

For A/C Goldman, Sachs & Co.

A/C #930-1-011483

ABA:  021-000021

 

Account for delivery of
Shares from Bank:

 

To be provided by Bank

 

6.               Offices:

 

The Office of Counterparty for the
Transaction is:  Inapplicable,
Counterparty is not a Multibranch Party.

 

8

 

The Office of Bank for the
Transaction is:  New York

 

Goldman, Sachs & Co.

One
New York Plaza

New
York, New York 10004

 

7.     Notices:  For purposes of this Confirmation:

 

(a)           Address for notices or
communications to Counterparty:

 

Textron Inc.

40
Westminster Street

Providence,
RI 02903

Attention:
Chief Financial Officer

	
  Telephone
  No.:

  	
  (401)
  421-2800

  
	
  Facsimile No.:

  	
  (401) 457-3533

  

 

(b)           Address for notices or
communications to Bank:

 

	
  To:

  	
  Goldman,
  Sachs & Co.

  
	
   

  	
  One New York
  Plaza

  
	
   

  	
  New York, NY
  10004

  
	
  Attn:

  	
  Serge Marquié,

  
	
   

  	
  Equity Capital
  Markets

  
	
  Telephone:

  	
  (212) 902-9779

  
	
  Facsimile:

  	
  (917) 977-4253

  
	
  Email:

  	
  marqse@am.ibd.gs.com

  

 

With a copy to:

 

	
  Attn:

  	
  Vijay Culas

  
	
   

  	
  Equity Capital
  Markets

  
	
  Telephone:

  	
  (212) 902-6247

  
	
  Facsimile:

  	
  (212) 428-1898

  
	
  Email:

  	
  vijay.culas@gs.com

  

 

And email notification to the following address:

Eq-derivs-notifications@am.ibd.gs.com

 

8.     Representations and
Warranties of Counterparty

 

The representations and
warranties made by Counterparty pursuant to the Underwriting Agreement (the “Underwriting Agreement”), dated as of April 29, 2009,
between Counterparty and J.P. Morgan Securities Inc. and Goldman, Sachs &
Co., as representatives of the underwriters party thereto (the “Underwriters”) on the “Option Closing Date” (as defined in
the Underwriting Agreement), are true and correct and are hereby deemed to be
repeated to Bank as if set forth herein. Counterparty hereby further represents
and warrants to Bank that:

 

(a)           Counterparty
has all necessary corporate power and authority to execute, deliver and perform
its obligations in respect of the Transaction; such execution, delivery and
performance have been duly authorized by all necessary corporate action on
Counterparty’s part; and this Confirmation has been duly and validly executed
and delivered by Counterparty and constitutes its valid and binding obligation,
enforceable against Counterparty in accordance with its terms, subject to
applicable bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and similar laws affecting creditors’ rights and remedies generally
and to general principles of equity, 

 

9

 

including principles of
commercial reasonableness, good faith and fair dealing (whether considered in a
proceeding at law or in equity) and except that rights to indemnification and
contribution hereunder may be limited by federal or state securities laws or
public policy relating thereto.

 

(b)           Neither the execution and delivery of this
Confirmation nor the incurrence or performance of obligations of Counterparty
hereunder will conflict with or result in a breach of the certificate of
incorporation or by-laws (or any equivalent documents) of Counterparty, or any
applicable law or regulation, or any order, writ, injunction or decree of any
court or governmental authority or agency, or any agreement or instrument to
which Counterparty or (to the extent such agreement is material to Counterparty
and its subsidiaries taken as a whole) any of its subsidiaries is a party or by
which Counterparty or (to such extent) any of its subsidiaries is bound or to
which Counterparty or (to such extent) any of its subsidiaries is subject, or
constitute a default under, or result in the creation of any lien under, any
such agreement or instrument.

 

(c)           No consent,
approval, authorization, or order of, or filing with, any governmental agency
or body or any court is required in connection with the execution, delivery or
performance by Counterparty of this Confirmation, except such as have been
obtained or made and such as may be required under the Securities Act of 1933,
as amended (the “Securities Act”)
or state securities laws.

 

(d)           It is an “eligible contract participant” (as such term
is defined in Section 1(a)(12) of the Commodity Exchange Act, as amended.

 

(e)           It is a “qualified institutional buyer” as defined in Rule 144A
under the Securities Act, or an “accredited investor” as defined under the
Securities Act.

 

(f)            Each of it and its affiliates is not, on the date
hereof, in possession of any material non-public information with respect to
Counterparty.

 

(g)           Counterparty represents that it is not subject to the
Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and the assets used in the
Transaction (1) are not assets of any “plan” (as such term is defined in Section 4975
of the Internal Revenue Code (the “Code”))
subject to Section 4975 of the Code or any “employee benefit plan” (as
such term is defined in Section 3(3) of ERISA) subject to Title I of
ERISA, and (2) do not constitute “plan assets” within the meaning of
Department of Labor Regulation 2510.3-101, 29 CFR Section 2510-3-101.

 

(h)           There is no law, rule, regulation or regulatory order
(collectively, “Adverse Laws”)
that, as a result of the ownership or control (whether direct, beneficial,
constructive or otherwise) of Shares by 
The Goldman Sachs Group, Inc. (“Bank
Parent”) or any person controlled directly or indirectly by Bank
Parent, would give rise to reporting or registration obligations or a
requirement to obtain prior approval from any person or entity on  Bank Parent or any such controlled person or
would result in a not insignificant adverse effect on Bank Parent or any such
controlled person, other than any Adverse Law that applies to the ownership of
equity positions generally without regard to the nature of the issuer’s
business (such as Sections 13 and 16 of the Exchange Act) or any Adverse Law
that applies solely as a result of the business, identity, place of business or
jurisdiction of organization of the holder of the common stock (such as the
Bank Holding Company Act of 1956, as amended).

 

(i)            Other than Textron Business Credit, Inc., which
is a “Rhode Island financial institution,” and Textron Financial Corporation,
which is a “Rhode Island bank holding company” but is not a bank holding
company under the Bank Holding Company Act of 1956, as amended, Counterparty is
not and does not control, directly or indirectly, a bank or bank holding
company or other financial institution regulated under federal or state banking
law.

 

10

 

(j)            It has received, read and understands the OTC Options
Risk Disclosure Statement and a copy of the most recent disclosure pamphlet
prepared by The Options Clearing Corporation entitled “Characteristics and
Risks of Standardized Options”.  Each
party acknowledges and agrees to be bound by the Conduct Rules of the
Financial Industry Regulatory Authority, Inc. applicable to transactions
in options, and further agrees not to violate the position and exercise limits
set forth therein.

 

9.     Other Provisions:

 

(a)           Opinions. Counterparty shall deliver to Bank an
opinion of counsel (including an in-house lawyer of Counterparty), dated as of
the Trade Date, with respect to the matters set forth in Sections 8(a) through
(c) of this Confirmation.

 

(b)           No Reliance, etc. Each party represents that (i) it
is entering into the Transaction evidenced hereby as principal (and not as
agent or in any other capacity); (ii) neither the other party nor any of its
agents are acting as a fiduciary for it; (iii) it is not relying upon any
representations except those expressly set forth in the Agreement or this
Confirmation; (iv) it has not relied on the other party for any legal,
regulatory, tax, business, investment, financial, and accounting advice, and it
has made its own investment, hedging, and trading decisions based upon its own
judgment and upon any view expressed by the other party or any of its agents;
and (v) it is entering into the Transaction with a full understanding of
the terms, conditions and risks thereof and it is capable of and willing to
assume those risks.

 

(c)           Repurchase Notices. Counterparty shall, on any day on which
Counterparty effects any repurchase of Shares, promptly give Bank a written
notice of such repurchase (a “Repurchase
Notice”) on such day if following such repurchase, the quotient of (i) the
sum of (A) the Number of Shares for the Transaction and (B) the
aggregate number of Shares underlying any other convertible bond hedge transactions
between Bank and Counterparty, if any, divided
by (ii) the number of Counterparty’s outstanding Shares (such
quotient expressed as a percentage, the “Option
Equity Percentage”) would be (x) greater than 9.0% or (y) 0.5%
greater than the Option Equity Percentage included in the immediately preceding
Repurchase Notice. Counterparty agrees to indemnify and hold harmless Bank and
its affiliates and their respective officers, directors, employees, affiliates,
advisors, agents and controlling persons (each, an “Indemnified Person”) from and against any and all losses
(including losses relating to Bank’s hedging activities as a consequence of
becoming, or of the risk of becoming, a Section 16 “insider”, including
without limitation, any forbearance from hedging activities or cessation of
hedging activities and any losses in connection therewith with respect to the
Transaction), claims, damages, judgments, liabilities and expenses (including
reasonable attorney’s fees), joint or several, which an Indemnified Person may
become subject to, as a result of Counterparty’s failure to provide Bank with a
Repurchase Notice on the day and in the manner specified in this paragraph, and
to reimburse, within 30 days, upon written request, each of such Indemnified
Persons for any reasonable legal or other expenses incurred in connection with
investigating, preparing for, providing testimony or other evidence in
connection with or defending any of the foregoing. If any suit, action,
proceeding (including any governmental or regulatory investigation), claim or
demand shall be brought or asserted against the Indemnified Person as a result
of Counterparty’s failure to provide Bank with a Repurchase Notice in
accordance with this paragraph, such Indemnified Person shall promptly notify
Counterparty in writing, and Counterparty, upon request of the Indemnified
Person, shall retain counsel reasonably satisfactory to the Indemnified Person
to represent the Indemnified Person and any others Counterparty may designate
in such proceeding and shall pay the fees and expenses of such counsel related
to such proceeding. Counterparty shall not be liable for any settlement of any
proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, Counterparty agrees
to indemnify any Indemnified Person from and against any loss or liability by
reason of such settlement or judgment. Counterparty shall not, without the
prior written consent of the Indemnified Person, effect any settlement of any
pending or threatened proceeding in respect of 

 

11

 

which any Indemnified
Person is or could have been a party and indemnity could have been sought
hereunder by such Indemnified Person, unless such settlement includes an
unconditional release of such Indemnified Person from all liability on claims
that are the subject matter of such proceeding on terms reasonably satisfactory
to such Indemnified Person. If the indemnification provided for in this
paragraph is unavailable to an Indemnified Person or insufficient in respect of
any losses, claims, damages or liabilities referred to therein, then
Counterparty under such paragraph, in lieu of indemnifying such Indemnified
Person thereunder, shall contribute to the amount paid or payable by such
Indemnified Person as a result of such losses, claims, damages or liabilities.
The remedies provided for in this paragraph are not exclusive and shall not
limit any rights or remedies which may otherwise be available to any
Indemnified Party at law or in equity. The indemnity and contribution
agreements contained in this paragraph shall remain operative and in full force
and effect regardless of the termination of the Transaction.

 

(d)           Regulation M. Counterparty is not on the Trade Date
engaged in a distribution, as such term is used in Regulation M under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), of any securities of Counterparty.  Counterparty shall not, until the second
Exchange Business Day immediately following the Trade Date, engage in any such
distribution.

 

(e)           No Manipulation. Counterparty is not entering into the
Transaction to create actual or apparent trading activity in the Shares (or any
security convertible into or exchangeable for the Shares) or to raise or
depress or otherwise manipulate the price of the Shares (or any security
convertible into or exchangeable for the Shares).

 

(f)            Number of Repurchased Shares. Counterparty represents that it could
have purchased Shares, in an amount equal to the product of the Number of
Options and the Option Entitlement, on the Exchange or otherwise, in compliance
with applicable law, its organizational documents and any orders, decrees and
contractual agreements binding upon Counterparty, on the Trade Date and the
Premium Payment Date.

 

(g)           Board Authorization. Each of the Transaction and the
issuance of the Convertible Notes was approved by its board of directors and
publicly announced, solely for the purposes stated in such board resolution and
public disclosure and, prior to any exercise of Options hereunder, Counterparty’s
board of directors will have duly authorized any repurchase of Shares pursuant
to the Transaction. Counterparty further represents that there is no internal
policy, whether written or oral, of Counterparty that would prohibit
Counterparty from entering into any aspect of the Transaction, including, but
not limited to, the purchases of Shares to be made pursuant hereto.

 

(h)           Transfer or Assignment. (i) Counterparty shall have the
right to transfer or assign its rights and obligations hereunder with respect
to all, but not less than all, of the Options hereunder (such Options, the “Transfer Options”); provided that such transfer or assignment
shall be subject to reasonable conditions that Bank may impose, including but
not limited, to the following conditions:

 

(A)          With respect to any Transfer Options, Counterparty
shall not be released from its notice and indemnification obligations pursuant
to Section 9(c) or any obligations under Section 9(r) or 9(v) of
this Confirmation;

 

(B)           Any Transfer Options shall only be transferred or
assigned to a third party that is a U.S. person (as defined in the Internal
Revenue Code of 1986, as amended);

 

(C)           Such transfer or assignment shall be effected on
terms, including any reasonable undertakings by such third party (including,
but not limited to, an undertaking with respect to compliance with applicable
securities laws in a manner that, in the reasonable judgment of Bank, will not
expose Bank to material risks under applicable securities laws) and execution
of any documentation and delivery of 

 

12

 

legal opinions with
respect to securities laws and other matters by such third party and Counterparty,
as are requested and reasonably satisfactory to Bank;

 

(D)          Bank will not, as a result of such transfer and
assignment, be required to pay the transferee on any payment date an amount
under Section 2(d)(i)(4) of the Agreement greater than an amount that
Bank would have been required to pay to Counterparty in the absence of such
transfer and assignment;

 

(E)           An Event of Default, Potential Event of Default or
Termination Event will not occur as a result of such transfer and assignment;

 

(F)           Without limiting the generality of clause (B),
Counterparty shall cause the transferee to make such Payee Tax Representations
and to provide such tax documentation as may be reasonably requested by Bank to
permit Bank to determine that results described in clauses (D) and (E) will
not occur upon or after such transfer and assignment; and

 

(G)           Counterparty shall be responsible for all reasonable
costs and expenses, including reasonable counsel fees, incurred by Bank in
connection with such transfer or assignment.

 

(ii)           Bank may transfer or assign without any consent of
Counterparty its rights and obligations hereunder, in whole or in part, to any
of its affiliates whose obligations hereunder would be guaranteed by The
Goldman Sachs Group, Inc.; provided further
that Bank may transfer or assign all or any portion of its rights or
obligations under the Transaction without consent of Counterparty to any third
party with a rating for its long term, unsecured and unsubordinated
indebtedness equal to or better than the lesser of (1) the credit rating
of Bank at the time of the transfer and (2) A- by Standard and Poor’s
Rating Group, Inc. or its successor (“S&P”),
or A3 by Moody’s Investor Service, Inc. (“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 agency rating
mutually agreed by Counterparty and Bank. If after Bank’s commercially
reasonable efforts, Bank is unable to effect a transfer or assignment on
pricing terms reasonably acceptable to Bank and within a time period reasonably
acceptable to Bank of a sufficient number of Options to reduce (1) Bank
Group’s “beneficial ownership” (within the meaning of Section 13 or Section 16
of the Exchange Act and rules promulgated thereunder) to 7.5% of Counterparty’s
outstanding Shares or less, (2) the Option Equity Percentage to 14.5% or
less, and (3) the Share Amount to the Post-Effective Limit (if any
applies) or less, Bank may designate any Exchange Business Day as an Early
Termination Date with respect to a portion (the “Terminated Portion”) of the Transaction, such that (1) Bank
Group’s “beneficial ownership” following such partial termination will be equal
to or less than 7.5%, (2) the Option Equity Percentage following such
partial termination will be equal to or less than 14.5%, and (3) the Share
Amount following such partial termination will be equal to or less than such
Post-Effective Limit. In the event that Bank so designates an Early Termination
Date with respect to a portion of the Transaction, a payment shall be made
pursuant to Section 6 of the Agreement as if (1) an Early Termination
Date had been designated in respect of a Transaction having terms identical to
the Transaction and a Number of Options equal to the Terminated Portion, (2) Counterparty
shall be the sole Affected Party with respect to such partial termination and (3) such
Transaction shall be the only Terminated Transaction (and, for the avoidance of
doubt, the provisions of paragraph 9(o) shall apply to any amount that is
payable by Bank to Counterparty pursuant to this sentence).  “Bank Group”
means Bank and each business unit of its affiliates subject to aggregation with
Bank under Section 13 or Section 16 of the Exchange Act and rules promulgated
thereunder.  The “Share Amount” as of any day is the number
of Shares that Bank and any person whose ownership position would be 

 

13

 

aggregated
with that of Bank (Bank or any such person, a “Bank
Person”) under any law, rule, regulation or regulatory order that for any
reason becomes applicable to ownership of Shares after the Trade Date (“Applicable
Laws”), owns, beneficially owns, constructively owns, controls, holds the
power to vote or otherwise meets a relevant definition of ownership of under
the Applicable Laws, as determined by Bank in its reasonable discretion. The “Post-Effective Limit” means (x) the
minimum number of Shares that would give rise to reporting or registration
obligations or other requirements (including obtaining prior approval from any
person or entity) of a Bank Person, or would result in an adverse effect on a
Bank Person, under the Applicable Laws, as determined by Bank in its reasonable
discretion, minus (y) 1% of
the number of Shares outstanding.  If at
any time Bank determines, in its reasonable opinion based upon advice of
counsel, that as a result of Counterparty’s direct or indirect interest in, or
direct or indirect control of, either Textron Business Credit, Inc. or
Textron Financial Corporation, any state or federal laws are or have become
applicable to Bank’s ownership of Shares, then the Post-Effective Limit and the
Share Amount shall be determined as set forth above in the definitions of those
terms, irrespective of whether or not such laws have been applicable to
ownership of Shares on or prior to the Trade Date.

 

(i)            Staggered
Settlement. If upon advice of counsel with respect to
applicable legal and regulatory requirements, including any requirements
relating to Bank’s hedging activities hereunder, or due to inability to borrow
Shares to deliver to Counterparty at a rate of borrowing less than 35 basis
points, Bank reasonably determines that it would not be practicable or
advisable to deliver, or to acquire Shares to deliver, any or all of the Shares
to be delivered by Bank on the Settlement Date for the Transaction, Bank may,
by notice to Counterparty on or prior to any Settlement Date (a “Nominal Settlement Date”), elect to deliver
the Shares on two or more dates (each, a “Staggered
Settlement Date”) as follows:

 

(a)           in such notice,
Bank will specify to Counterparty the related Staggered Settlement Dates, which
Bank shall choose in a commercially reasonable manner, (the first of which will
be such Nominal Settlement Date and the last of which will be no later than the
twentieth (20th) Exchange Business Day following such Nominal Settlement Date)
and the number of Shares that it will deliver on each Staggered Settlement Date
on a payment versus delivery basis;

 

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

 

(c)           if the Physical
Settlement terms, the Low Cash Combination Settlement terms or the High Cash
Combination Settlement terms set forth above were to apply on the Nominal
Settlement Date, then the Physical Settlement terms, the Low Cash Combination
Settlement terms or the High Cash Combination Settlement terms, as the case may
be, will apply on each Staggered Settlement Date, except that the Shares will
be allocated among such Staggered Settlement Dates as specified by Bank in the
notice referred to in clause (a) above.

 

(j)            Damages. Neither party
shall be liable under Section 6.10 of the Equity Definitions for special,
indirect or consequential damages, even if informed of the possibility thereof,
except as specifically set forth otherwise herein.

 

(k)           Early
Unwind. In the event the sale of “Option Securities” (as defined
in the Underwriting Agreement) is not consummated with the Underwriters for any
reason or Counterparty fails to deliver to Bank opinions of counsel to
Counterparty as required pursuant to Section 9(a) by the close of
business in New York on May 5, 2009 or such later date as agreed upon by
the parties (May 5, 2009 or such later date the “Early Unwind Date”), the Transaction shall
automatically 

 

14

 

terminate
(the “Early Unwind”), on the Early
Unwind Date and (i) the Transaction and all of the respective rights and
obligations of Bank and Counterparty under the Transaction shall be cancelled
and terminated and (ii) each party shall be released and discharged by the
other party from and agrees not to make any claim against the other party with
respect to any obligations or liabilities of the other party arising out of and
to be performed in connection with the Transaction either prior to or after the
Early Unwind Date; provided that,
other than to the extent the Early Unwind Date occurred as a result of the
breach of the Underwriting Agreement by the Underwriters, Counterparty shall
reimburse Bank, in cash or Shares, for any costs or expenses (including market
losses) relating to the unwinding of its or its affiliate’s hedging activities
in connection with the Transaction (including any loss or cost incurred as a
result of its terminating, liquidating, obtaining or reestablishing any hedge
or related trading position). Bank shall notify Counterparty of such amount and
Counterparty shall pay such amount in immediately available funds or deliver
Shares on the Early Unwind Date. Bank and Counterparty represent and
acknowledge to the other that, subject to the proviso included in this
paragraph, upon an Early Unwind, all obligations with respect to the
Transaction shall be deemed fully and finally discharged.

 

(l)            Reserved.

 

(m)          Additional
Provisions.

 

(i)            Section 9.6(a)(ii) of
the Equity Definitions is hereby amended by (1) deleting from the third
line thereof the word “or” after the word “official” and inserting a comma
therefor, and (2) deleting the period at the end of subsection (ii) thereof
and inserting the following words therefor “ or (C) at Bank’s option, the
occurrence of any of the events specified in Section 5(a)(vii) (1) through
(9) of the Agreement with respect to that Issuer.”

 

(ii)           Notwithstanding
Section 9.7 of the Equity Definitions, everything in the first paragraph
of Section 9.7(b) of the Equity Definitions after the words “Calculation
Agent” in the third line through the remainder of such Section 9.7 shall
be deleted and replaced with the following:

 

“based
on an amount representing the Calculation Agent’s determination of the fair
value to Counterparty of an option with terms that would preserve for
Counterparty the economic equivalent of any payment or delivery (assuming
satisfaction of each applicable condition precedent) by the parties in respect
of the relevant Transaction that would have been required after that date but
for the occurrence of the Option Value Event.”

 

(iii)          Notwithstanding
anything to the contrary in this Confirmation, if any of the following events
occurs, (1) Bank shall have the right to designate such an event an
Additional Termination Event and designate an Early Termination Date pursuant
to Section 6(b) of the Agreement, and (2) Counterparty shall be
deemed the sole Affected Party and the Transaction shall be deemed the sole
Affected Transaction:

 

(a)           At any time
during the period from and including the Trade Date, to and including the
Expiration Date, the Shares cease to be listed or quoted on the Exchange for
any reason (other than a Merger Event as a result of which the shares of common
stock underlying the Options are listed or quoted on the New York Stock
Exchange, the NASDAQ Global Market or the NASDAQ Global Select Market (or their
respective successors) (each, a “Successor
Exchange”)) and are not immediately re-listed or quoted as of the
date of such de-listing on a Successor Exchange.

 

15

 

(b)           Counterparty
amends, modifies, supplements or waives any term of the Indenture or the
Convertible Notes governing the principal amount, coupon, maturity, repurchase
obligation of Counterparty, redemption right of Counterparty, any term relating
to conversion of the Convertible Notes (including changes to the conversion
price, conversion settlement dates or conversion conditions), or any term that
would require consent of the holders of not less than 100% of the principal
amount of the Convertible Notes to amend, in each case without the prior
consent of Bank.

 

(c)           On or after the
Trade Date, a Change in Law (as defined in the 2002 Equity Derivatives
Definitions as published by ISDA (the “2002
Definitions”), with any reference in such definition to “Shares”
being replaced with references to “Hedge Position(s)” and without regard to
clause (Y) of such definition) shall have occurred.

 

(iv)          Notwithstanding
anything to the contrary in this Confirmation, the giving of any Notice of
Exercise shall constitute an Additional Termination Event hereunder with
respect to the number, if any, of Exercisable Options specified in such Notice
of Exercise as corresponding to a conversion of Relevant Convertible Notes in
compliance with Section 9.03 of the Supplemental Indenture. Upon receipt
of any such notice, Bank shall designate an Exchange Business Day as an Early
Termination Date (such day to occur as close as practicable, in Bank’s
commercially reasonable judgment, to the settlement date of the Relevant
Convertible Notes), with respect to the portion of the Transaction
corresponding to number of such Exercisable Options so specified. In lieu of
the provisions of “Delivery Obligation”, any payment and/or delivery hereunder
with respect to such conversion shall be calculated pursuant to Section 6
of the Agreement; where, for the purposes of such calculation, (A) Counterparty
shall be the sole Affected Party with respect to such Additional Termination
Event, (B) Bank shall be the party entitled to designate an Early Termination
Date pursuant to Section 6(b) of the Agreement; and (C) for the
avoidance of doubt, in determining the amount payable pursuant to Section 6
of the Agreement, the Calculation Agent (i) shall take into account the
time value of the Transaction with respect to the Expiration Date and (ii) shall
not take into account any adjustments to the Option Entitlement that result
from corresponding adjustments to the Conversion Rate pursuant to Section 9.03
of the Supplemental Indenture; provided
further that (A) in case of a partial termination, an Early Termination
Date shall be designated in respect of a Transaction having terms identical to
the Transaction and a Number of Options equal to the terminated portion and
such Transaction shall be the only Terminated Transaction; (B) any amount
payable by Bank to Counterparty shall be satisfied solely by delivery by Bank
to Counterparty of a number of Shares and cash in lieu of a fractional share
equal to such amount calculated pursuant to Section 6 divided by
a price per Share determined by the Calculation Agent; and (C) the number
of Shares deliverable in respect of such early termination by Bank to
Counterparty shall not be greater than the product of (x) the Applicable
Percentage and (y) the excess of (a) the total number of Shares
underlying the corresponding Relevant Convertible Notes (including the number
of Additional Shares (as defined in the Supplemental Indenture) resulting from
any adjustment set forth in Section 9.03 of the Supplemental Indenture)
over (b) the number of Shares equal in value to the aggregate principal
amount of the corresponding Relevant Convertible Notes, as determined by the
Calculation Agent in its sole reasonable discretion.

 

(vi)          For the avoidance of doubt, in determining the
Close-out Amount pursuant to Section 6(e) of the Agreement, the
Determining Party shall act in good faith and a commercially reasonable manner,
and, upon request, the Determining Party shall provide to the other party a
statement showing in reasonable detail, such calculations (including any
quotations, market data or information from internal sources used in making
such 

 

16

 

calculation);
provided that the Determining Party
shall not be obligated to disclose any proprietary model used for such
calculation.

 

(n)           No
Collateral or Setoff. 
Notwithstanding any provision of the Agreement or any other agreement
between the parties to the contrary, the obligations of the Counterparty
hereunder are not secured by any collateral. Each party waives any and all
rights it may have to set-off delivery or payment obligations it owes to the
other party under the Transaction against any delivery or payment obligations
owed to it by the other party, whether arising under the Agreement, under any
other agreement between parties hereto, by operation of law or otherwise.
Notwithstanding anything to the contrary in the Equity Definitions,
Counterparty shall have no obligation to make any delivery or payment to Bank (i) pursuant
to Section 9.7 of the Equity Definitions or (ii) pursuant to Section 6(d)(ii) of
the Agreement.

 

(o)           Alternative
Calculations and Payment on Early Termination and on Certain Extraordinary
Events. If in respect of the Transaction, an amount is
payable by Bank to Counterparty (i) pursuant to Section 9.7 of the
Equity Definitions or (ii) pursuant to Sections 6(d) and 6(e) of
the Agreement (a “Payment Obligation”),
Counterparty may request Bank to satisfy any such Payment Obligation by the
Share Termination Alternative (as defined below) (except that Counterparty
shall not make such an election in a Merger Event, in which the consideration
to be paid to holders of Shares consists solely of cash, or an Event of Default
in which Counterparty is the Defaulting Party or a Termination Event in which
Counterparty is the Affected Party, other than an Event of Default of the type
described in Section 5(a)(iii), (v), (vi), (vii) or (viii) of
the Agreement or a Termination Event of the type described in Section 5(b) of
the Agreement in each case that resulted from an event or events outside
Counterparty’s control) and shall give irrevocable telephonic notice to Bank,
confirmed in writing within one Currency Business Day, no later than 12:00 p.m.
New York local time on the Merger Date or the Early Termination Date, as
applicable; provided that if
Counterparty does not validly request Bank to satisfy its Payment Obligation by
the Share Termination Alternative, Bank shall have the right, in its sole
discretion, to satisfy its Payment Obligation by the Share Termination
Alternative, notwithstanding Counterparty’s election to the contrary.

 

	
  Share Termination
  Alternative:

  	
   

  	
  Applicable and means that
  Bank shall deliver to Counterparty the Share Termination Delivery Property on
  the date when the Payment Obligation would otherwise be due pursuant to
  Section 9.7 of the Equity Definitions or Section 6(d)(ii) and
  6(e) of the Agreement, as applicable (the “Share
  Termination Payment Date”), in satisfaction of the Payment
  Obligation in the manner reasonably requested by Counterparty free of
  payment.

  
	
   

  	
   

  	
   

  
	
  Share Termination Delivery
  Property:

  	
   

  	
  A number of Share
  Termination Delivery Units, as calculated by the Calculation Agent, equal to
  the Payment Obligation divided by
  the Share Termination Unit Price. The Calculation Agent shall adjust the
  Share Termination Delivery Property by replacing any fractional portion of a
  security therein with an amount of cash equal to the value of such fractional
  security based on the values used to calculate the Share Termination Unit
  Price.

  
	
   

  	
   

  	
   

  
	
  Share Termination Unit
  Price:

  	
   

  	
  The value to Bank of
  property contained in one Share Termination Delivery Unit on the date such
  Share Termination Delivery Units are to be delivered as Share Termination
  Delivery Property, as determined by the Calculation Agent in its discretion
  by commercially reasonable means and notified by the Calculation Agent to
  Bank at the time of notification of

  

 

17

 

	
   

  	
   

  	
  the Payment Obligation.
  For the avoidance of doubt, the parties agree that in determining the Share
  Termination Delivery Unit Price the Calculation Agent may consider the
  purchase price paid in connection with the purchase of Share Termination
  Delivery Property.

  
	
   

  	
   

  	
   

  
	
  Share Termination Delivery
  Unit:

  	
   

  	
  One Share or, if a Merger
  Event has occurred and a corresponding adjustment to the Transaction has been
  made, a unit consisting of the number or amount of each type of property
  received by a holder of one Share (without consideration of any requirement
  to pay cash or other consideration in lieu of fractional amounts of any
  securities) in such Merger Event, as determined by the Calculation Agent.

  
	
   

  	
   

  	
   

  
	
  Failure to Deliver:

  	
   

  	
  Applicable

  
	
   

  	
   

  	
   

  
	
  Other applicable
  provisions:

  	
   

  	
  If Share Termination
  Alternative is applicable, the provisions of Sections 6.6, 6.7, 6.8, 6.9 and
  6.10 (as modified above) of the Equity Definitions will be applicable, except
  that all references in such provisions to “Physically-Settled” shall be read
  as references to “Share Termination Settled” and all references to “Shares”
  shall be read as references to “Share Termination Delivery Units”. “Share
  Termination Settled” in relation to the Transaction means that Share
  Termination Alternative is applicable to the Transaction.

  

 

(p)           Governing
Law; Exclusive Jurisdiction. For the Agreement and this
Confirmation, New York law (without reference to choice of law doctrine to the
extent inconsistent with choice of New York law).  Section 13(b) of the Agreement is
hereby amended by (i) deleting the words “non-exclusive” in Section 13(b)(i)(2) and
replacing them with the word “exclusive”, and (ii)  inserting after the
word “law” in Section 13(b)(iii) the words “and subject to Section 13(b)(i)(2)”.

 

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

 

(r)            Registration. Counterparty
hereby agrees that if, in the good faith reasonable judgment of Bank, the
Shares (“Hedge Shares”) acquired
by Bank for the purpose of hedging its obligations pursuant to the Transaction
cannot be sold in the public market by Bank without registration under the
Securities Act, Counterparty shall, at its election, either (i) in order
to allow Bank to sell the Hedge Shares in a registered offering, make available
to Bank an effective registration statement under the Securities Act and enter
into an agreement, in form and substance satisfactory to Bank, substantially in
the form of an underwriting agreement for a registered secondary offering; provided however, that if Bank, 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 paragraph shall apply at the election of
Counterparty, (ii) in order to allow Bank 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 of similar size, in form and substance
satisfactory to Bank (in which case, the Calculation Agent shall make any
adjustments to the terms of the Transaction which are necessary, in its
reasonable 

 

18

 

judgment,
to compensate Bank 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 Bank at the Last Reported Sale Price on such Trading
Days, and in the amounts, requested by Bank.

 

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

 

(t)            Status
of Claims in Bankruptcy. Bank acknowledges and
agrees that this Confirmation is not intended to convey to Bank rights with
respect to the Transaction that are senior to the claims of common stockholders
of Counterparty in any U.S. bankruptcy proceedings of Counterparty; provided that nothing herein shall limit
or shall be deemed to limit Bank’s right to pursue remedies in the event of a
breach by Counterparty of its obligations and agreements with respect to the
Transaction; provided, further,
that nothing herein shall limit or shall be deemed to limit Bank’s rights in
respect of any transactions other than the Transaction.

 

(u)           Securities
Contract; Swap Agreement. The parties hereto intend
for:  (a) the Transaction to be a “securities
contract” and a “swap agreement” and the Agreement to be a “master netting
agreement”, in each case as defined in the Bankruptcy Code (Title 11 of the
United States Code) (the “Bankruptcy Code”),
and the parties hereto to be entitled to the protections afforded by, among
other Sections, Sections 362(b)(6), 362(b)(7), 362(b)(27), 362(o), 546(e),
546(g), 546(j), 548(d)(2), 555, 560 and 561 of the Bankruptcy Code; (b) a
party’s right to liquidate the Transaction and to exercise any other remedies
upon the occurrence of any Event of Default or Termination Event under the
Agreement with respect to the other party or any Extraordinary Event that
results in the termination or cancellation of any Transaction to constitute a “contractual
right” as described in the Bankruptcy Code; and (c) each payment and
delivery of cash, securities or other property hereunder to constitute a “margin
payment” or “settlement payment” and a “transfer” as defined in the Bankruptcy
Code.

 

(v)           Additional
Provisions. Counterparty covenants and agrees that, as
promptly as practicable following the public announcement of any consolidation,
merger and binding share exchange to which Counterparty is a party, or any sale
of all or substantially all of Counterparty’s assets, in each case pursuant to
which the Shares will be converted into cash, securities or other property,
Counterparty shall notify Bank in writing of the types and amounts of
consideration that holders of Shares have elected to receive upon consummation
of such transaction or event (the date of such notification, the “Consideration Notification Date”); provided that in no event shall the
Consideration Notification Date be later than the date on which such
transaction or event is consummated.

 

(w)          Private
Placement Procedures. If, in the reasonable opinion of Bank based
upon advice of counsel, following any delivery of Shares to Bank pursuant to Section 9(k) “
Early Unwind”, such Shares would be in the hands of Bank subject to any
applicable restrictions with respect to any registration or qualification
requirement or prospectus delivery requirement for such Shares pursuant to any
applicable federal or state securities law (including, without limitation, any
such requirement arising under Section 5 of the Securities Act as a result
of such Shares being “restricted securities”, as such term is defined in Rule 144
under the Securities Act, or as a result of the sale of such Shares or Share
Termination Delivery Property being subject to paragraph (c) of Rule 145
under the Securities Act) (such Shares, “Restricted
Shares”), then delivery of such Restricted Shares shall be effected
pursuant to clause (i) below.

 

(i)            Delivery of
Restricted Shares by Counterparty shall be effected in customary private
placement procedures with respect to such Restricted Shares of similar size in
form and 

 

19

 

substance
reasonably acceptable to Bank (a “Private
Placement Settlement”). The Private Placement Settlement of such
Restricted Shares shall include customary representations, covenants, blue sky
and other governmental filings and/or registrations, indemnities to Bank, due
diligence rights (for Bank or any designated buyer of the Restricted Shares by
Bank), opinions and certificates, and such other documentation as is customary
for private placement agreements, all reasonably acceptable to Bank. Bank shall
determine the appropriate discount applicable to such Restricted Shares in a
commercially reasonable manner and appropriately adjust the amount of such
Restricted Shares to be delivered to Bank hereunder; provided
that in no event such number shall be greater than 0.9 times the Number of
Shares (the “Maximum Amount”).
Notwithstanding the Agreement or this Confirmation, the date of delivery of
such Restricted Shares shall be the Exchange Business Day following notice by
Bank to Counterparty, of such applicable discount and the number of Restricted
Shares to be delivered pursuant to this clause (i).

 

(ii)           In the event
Counterparty shall not have delivered the full number of Restricted Shares
otherwise applicable as a result of the proviso above relating to the Maximum
Amount (such deficit, the “Deficit Restricted
Shares”), Counterparty shall be continually obligated to deliver,
from time to time until the full number of Deficit Restricted Shares have been
delivered pursuant to this paragraph, Restricted Shares when, and to the
extent, that (i) Shares are repurchased, acquired or otherwise received by
Counterparty or any of its subsidiaries after the Trade Date (whether or not in
exchange for cash, fair value or any other consideration), (ii) authorized
and unissued Shares reserved for issuance in respect of other transactions
prior to the Trade Date which prior to such date become no longer so reserved
and (iii) Counterparty additionally authorizes any unissued Shares that
are not reserved for other transactions. Counterparty shall immediately notify
Bank of the occurrence of any of the foregoing events (including the number of
Shares subject to clause (i), (ii) or (iii) and the corresponding
number of Restricted Shares to be delivered) and promptly deliver the
Applicable Percentage of the aggregate number of such Restricted Shares
thereafter.

 

(iii)          Without
limiting the generality of the foregoing, Counterparty agrees that any
Restricted Shares delivered to Bank, as purchaser of such Restricted Shares, (i) may
be transferred by and among Bank and its affiliates and Counterparty shall
effect such transfer without any further action by Bank and (ii) after the
period of 6 months from the Trade Date (or 1 year from the Trade Date if, at
such time, informational requirements of Rule 144(c) are not
satisfied with respect to Counterparty) has elapsed after any Settlement Date
for such Restricted Shares, Counterparty shall promptly remove, or cause the
transfer agent for such Restricted Shares to remove, any legends referring to
any such restrictions or requirements from such Restricted Shares upon request
by Bank (or such affiliate of Bank) to Counterparty or such transfer agent,
without any requirement for the delivery of any certificate, consent,
agreement, opinion of counsel, notice or any other document, any transfer tax
stamps or payment of any other amount or any other action by Bank (or such affiliate
of Bank).

 

If Counterparty shall fail to effectuate the
Private Placement Settlement as set forth in clause (i), then such failure
shall constitute an Event of Default with respect to which Counterparty shall
be the Defaulting Party.

 

(x)            Right to
Extend.  Bank may postpone any Exercise
Date or Settlement Date or any other date of valuation or delivery by Bank,
with respect to some or all of the relevant Options (in which event the
Calculation Agent shall make appropriate adjustments to the Delivery Obligation),
if Bank determines, in its reasonable discretion based on advice of counsel,
that such extension is reasonably necessary to preserve Bank’s hedging or hedge
unwind activity hereunder in light of existing liquidity conditions or to
enable Bank to effect purchases of Shares or Share Termination 

 

20

 

Delivery Units in connection
with its hedging, hedge unwind or settlement activity hereunder in a manner
that would, if Bank were Counterparty or an affiliated purchaser of
Counterparty, be in compliance with applicable legal, regulatory or
self-regulatory requirements.

 

(y)           Dividends.  If at any time during the period from and
including the Trade Date, to but excluding the Expiration Date, (i) an
ex-dividend date for a regular quarterly cash dividend occurs with respect to
the Shares (an “Ex-Dividend Date”),
and that dividend is less than the Regular Dividend on a per Share basis or (ii) if
no Ex-Dividend date for a regular quarterly cash dividend occurs with respect
to the Shares in any quarterly dividend period of Counterparty, then the
Calculation Agent will make a corresponding adjustment to any one or more of
the Strike Price, Number of Options, Option Entitlement and/or any other
variable relevant to the exercise, settlement or payment for the Transaction to
preserve the fair value of the Options to Bank after taking into account such
dividend or lack thereof.  “Regular Dividend” shall mean USD 0.02 per
Share per quarter.

 

21

 

Counterparty hereby agrees (a) to check this
Confirmation carefully and immediately upon receipt so that errors or
discrepancies can be promptly identified and rectified and (b) to confirm
that the foregoing (in the exact form provided by Bank) correctly sets forth
the terms of the agreement between Bank and Counterparty with respect to the
Transaction, by manually signing this Confirmation or this page hereof as
evidence of agreement to such terms and providing the other information
requested herein and immediately returning an executed copy to Equity
Derivatives Documentation Department, Facsimile No. (212) 428-1980/83.

 

	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Very truly yours,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  GOLDMAN,
  SACHS & CO.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Daniel W. Kopper

  
	
   

  	
   

  	
   

  	
  Authorized Signatory

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Accepted and confirmed

  	
   

  	
   

  	
   

  
	
  as of the Trade Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  TEXTRON INC.

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Mary F. Lovejoy

  	
   

  	
   

  	
   

  
	
  Authorized Signatory

  	
   

  	
   

  	
   

  
	
  Name: Mary F. Lovejoy

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00158-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00158-of-00352.parquet"}]]