Document:

exv10w8

Exhibit 10.8

EXECUTION VERSION

RBC Capital Markets, LLC

as agent for Royal Bank of Canada

3 World Financial Center — 8th Floor

200 Vesey Street

New York, NY 10006-1404

Attn: Andrew Apthorpe

Telephone: 212-858-7000

Facsimile: 212-428-3053

June 9, 2011

			
	To:	 	Integra LifeSciences Holdings Corporation

311 Enterprise Drive

Plainsboro, NJ 08536

Attention: Treasurer

Telephone No.: (609) 275-0500

Facsimile No.: (609) 750-4264

Re:    Base Call Option Transaction

     The purpose of this letter agreement (this “Confirmation”) is to confirm the terms and
conditions of the call option transaction entered into between Royal Bank of Canada (“Dealer”) and
Integra LifeSciences Holdings Corporation (“Counterparty”) as of 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 2002 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 are based on terms that are defined in the Offering Memorandum dated June 9, 2011 (the
“Offering Memorandum”) relating to the 1.625% Convertible Senior Notes due 2016 (as originally
issued by Counterparty, the “Convertible Notes” and each USD 1,000 principal amount of Convertible
Notes, a “Convertible Note”) issued by Counterparty in an aggregate initial principal amount of USD
200,000,000 (as increased by up to an aggregate principal amount of USD 30,000,000 if and to the
extent that the Representatives (as defined herein) exercise their option to purchase additional
Convertible Notes pursuant to the Purchase Agreement (as defined herein)) pursuant to an Indenture
to be dated June 15, 2011 between Counterparty and Wells Fargo Bank, National Association, as
trustee (the “Indenture”). In the event of any inconsistency between the terms defined in the
Offering Memorandum, 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 that 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 Offering Memorandum. For the avoidance of doubt,
references herein to sections of the Indenture are based on the draft of the Indenture most
recently reviewed by the parties at the time of execution of this Confirmation. If any relevant
sections of the Indenture are changed, added or renumbered following execution of this Confirmation
but prior to the execution of the Indenture, the parties will amend this Confirmation in good faith
to preserve the economic intent of the parties based on the draft of the Indenture so reviewed. The
parties further acknowledge that 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 Dealer and Counterparty 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 Dealer and Counterparty had executed an agreement in such form
(but without any Schedule except for (i) the election of the laws of the State of New York as the
governing law (without reference to choice of law doctrine); (ii) the election that the “Cross
Default” provisions of Section 5(a)(vi) of the Agreement shall apply to both parties, provided that
(a) the phrase “or becoming capable at such time of being declared” shall be deleted from clause
(1) of such Section 5(a)(vi); (b) the following language shall be added to the end thereof:
“Notwithstanding the foregoing, a default under subsection (2) hereof shall not constitute an Event
of Default if (i) the default was caused solely by error or omission of an administrative or
operational nature; (ii) funds were available to enable the party to make the payment when due; and
(iii) the payment is made within two Local Business Days of such party’s receipt of written notice
of its failure to pay.”; (c) “Specified Indebtedness” will have the meaning specified in Section 14
of the Agreement, except that such term shall not include obligations in respect of deposits
received in the ordinary course of a party’s banking business; and (d) “Threshold Amount” means in
relation to Dealer, three percent (3%) of shareholders’ equity of Dealer and in relation to
Counterparty, USD 25 million.)) on the Trade Date. In the event of any inconsistency between
provisions of the 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:

	 	June 9, 2011
	Effective Date:

	 	The third Exchange Business Day immediately prior to
the Premium Payment Date
	Option Style:

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

	 	Call
	Buyer:

	 	Counterparty
	Seller:

	 	Dealer
	Shares:

	 	The common stock of Counterparty, par value USD0.01
per share (Exchange symbol “IART”).
	Number of Options:

	 	200,000. For the avoidance of doubt, the Number of
Options shall be reduced by any Options exercised by
Counterparty. In no event will the Number of Options be
less than zero.
	Applicable Percentage:

	 	40% 
	Option Entitlement:

	 	A number equal to the product of the Applicable
Percentage and 17.4092.
	Strike Price:

	 	USD 57.441
	Premium:

	 	USD 14,920,000
	Premium Payment Date:

	 	June 15, 2011
	Exchange:

	 	The NASDAQ Global Select Market
	Related Exchange(s):

	 	All Exchanges

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	Excluded Provisions:

	 	Section 14.03 and Section 14.04(g) of the Indenture.

     Procedures for Exercise.

	 	 	 

	Conversion Date:

	 	With respect to any conversion of a Convertible Note, the
date on which the Holder (as such term is defined in the
Indenture) of such Convertible Note satisfies all of the
requirements for conversion thereof as set forth in
Sections 14.02(b) and (c) of the Indenture.
	Free Convertibility Date:

	 	June 15, 2016
	Expiration Time:

	 	The Valuation Time
	Expiration Date:

	 	December 15, 2016, subject to earlier exercise.
	Multiple Exercise:

	 	Applicable, as described under “Automatic Exercise”
below.
	Automatic Exercise:

	 	Notwithstanding Section 3.4 of the Equity Definitions, on
each Conversion Date, a number of Options equal to the
number of Convertible Notes in denominations of USD
1,000 as to which such Conversion Date has occurred
shall be deemed to be automatically exercised; provided
that such Options shall be exercised or deemed to be
exercised only if Counterparty has provided a Notice of
Exercise to Dealer in accordance with “Notice of
Exercise” below.
	 

	 	Notwithstanding the foregoing, in no event shall the
number of Options that are exercised or deemed exercised
hereunder exceed the Number of Options.
	Notice of Exercise:

	 	Notwithstanding anything to the contrary in the Equity
Definitions or under “Automatic Exercise” above, in
order to exercise any Options, Counterparty must notify
Dealer in writing before (i) 5:00 p.m. (New York City
time) on the Scheduled Valid Day immediately preceding
the scheduled first day of the Settlement Averaging
Period for the Options being exercised or (ii) 5:00 p.m.
(New York City time) on the fifth Scheduled Valid Day
immediately following the scheduled first day of the
Settlement Averaging Period for the Options being
exercised (in which case the Calculation Agent will
determine the adjustment to be made to any one or more
of the Strike Price, Number of Options, Option
Entitlement and any other variable relevant to the
exercise, settlement or payment for the Transaction in a
commercially reasonable manner as appropriate to reflect
the additional costs (including, but not limited to, hedging
mismatches and market losses) and reasonable expenses
incurred by Dealer in connection with its hedging
activities (including the unwinding of any hedge position)
due to such notification occurring after the time specified
in the immediately preceding clause (i)) of (w) the
number of such Options (without regard to any
adjustments by the Calculation Agent in accordance with

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	 	the immediately preceding clause (ii)) and (x) the
scheduled first day of the Settlement Averaging Period
and the scheduled Settlement Date, (y) the Relevant
Settlement Method for such Options, and (z) if the
Relevant Settlement Method for such Options is not Net
Share Settlement (as defined below), the percentage of
each Share issuable upon conversion in excess of the
principal portion of the Convertible Notes being
converted that will be paid in cash (the “Cash
Percentage”), and such notice shall also include the
information, representations, acknowledgements and
agreements required pursuant to “Settlement Method
Election Conditions” below; provided that in respect of
any Options relating to Convertible Notes with a
Conversion Date occurring on or after the Free
Convertibility Date, (A) such notice may be given on or
prior to the second Scheduled Valid Day immediately
preceding the Expiration Date and need only specify the
information required in clause (w) above, and (B) if the
Relevant Settlement Method for such Options is not Net
Share Settlement, Dealer shall have received a separate
notice (the “Notice of Final Settlement Method”) in
respect of all such Convertible Notes before 5:00 p.m.
(New York City time) on or prior to the Free
Convertibility Date specifying the information required in
clauses (y) and (z) above, as well as the information,
representations, acknowledgements and agreements
required pursuant to “Settlement Method Election
Conditions” below.
	Valuation Time:

	 	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.
	Market Disruption Event:

	 	Section 6.3(a) of the Equity Definitions is hereby replaced
in its entirety by the following:
	 

	 	“Market Disruption Event’ means, in respect of a Share,
(i) a failure by the primary U.S. national or regional
securities exchange or market on which the Shares are
listed or admitted for trading to open for trading during its
regular trading session or (ii) the occurrence or existence
prior to 1:00 p.m., New York City time, on any Scheduled
Valid Day for the Shares for more than one half-hour
period in the aggregate during regular trading hours of
any suspension or limitation imposed on trading (by
reason of movements in price exceeding limits permitted
by the relevant stock exchange or otherwise) in the Shares
or in any options, contracts or future contracts relating to
the Shares.”

     Settlement Terms.

	 	 	 

	Settlement Method:

	 	For any Option, Net Share Settlement; provided that if the
Relevant Settlement Method set forth below for such
Option is not Net Share Settlement, then the Settlement

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	 	Method for such Option shall be such Relevant Settlement
Method, but only if the Settlement Method Election
Conditions have been satisfied and Counterparty shall
have notified Dealer of the Relevant Settlement Method
in the Notice of Exercise or Notice of Final Settlement
Method, as applicable, for such Option.
	Relevant Settlement Method:

	 	In respect of any Option, subject to the Settlement
Method Election Conditions:
	 

	 	(i) if Counterparty has not specified a Cash Percentage
or has specified a Cash Percentage of 0% in respect of
settling its conversion obligations in respect of the related
Convertible Note pursuant to Section 14.02(a)(i) of the
Indenture, then, in either case, the Relevant Settlement
Method for such Option shall be Net Share Settlement;
	 

	 	(ii) if Counterparty has specified a Cash Percentage of
between 0% and 100% in respect of settling its
conversion obligations in respect of the related
Convertible Note pursuant to Section 14.02(a)(i) of the
Indenture, then the Relevant Settlement Method for such
Option shall be Combination Settlement; and
	 

	 	(iii) if Counterparty has specified a Cash Percentage of
100% in respect of settling its conversion obligations in
respect of the related Convertible Note pursuant to
Section 14.02(a)(i) of the Indenture, then the Relevant
Settlement Method for such Option shall be Cash
Settlement.
	Settlement Method Election Conditions:

	 	For any Relevant Settlement Method other than Net Share
Settlement, such Relevant Settlement Method shall apply
to an Option only if the Notice of Exercise or Notice of
Final Settlement Method for such Option, as applicable,
contains:
	 

	 	(i)    a representation that, on the date of such Notice of
Exercise or Notice of Final Settlement Method, as
applicable, Counterparty is not in possession of any
material non-public information with respect to
Counterparty or the Shares;

	 

	 	(ii)   a representation that Counterparty is electing the
settlement method for the related Convertible Note
and such Relevant Settlement Method 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”);

	 

	 	(iii)   a representation that Counterparty has not entered
into or altered any hedging transaction relating to
the Shares corresponding to or offsetting the
Transaction;

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	 	(iv)    a representation that Counterparty is not electing
the settlement method for the related Convertible
Note and such Relevant Settlement Method 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); and

	 

	 	(v)    an acknowledgment by Counterparty that (A) any
transaction by Dealer following Counterparty’s
election of the settlement method for the related
Convertible Note and such Relevant Settlement
Method shall be made at Dealer’s sole discretion
and for Dealer’s own account and (B) Counterparty
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.

	Net Share Settlement:

	 	If Net Share Settlement is applicable to any Option
exercised or deemed exercised hereunder, Dealer will
deliver to Counterparty, on the relevant Settlement Date
for each such Option, a number of Shares (the “Net Share
Settlement Amount”) equal to the sum, for each Valid
Day during the Settlement Averaging Period for each
such Option, of (i) the Daily Option Value for such Valid
Day, divided by (ii) the Relevant Price on such Valid Day,
divided by (iii) the number of Valid Days in the
Settlement Averaging Period.
	 

	 	Dealer will deliver cash in lieu of any fractional Shares to
be delivered with respect to any Net Share Settlement
Share Amount valued at the Relevant Price for the last
Valid Day of the Settlement Averaging Period.
	Combination Settlement:

	 	If Combination Settlement is applicable to any Option
exercised or deemed exercised hereunder, Dealer will pay
or deliver, as the case may be, to Counterparty, on the
relevant Settlement Date for each such Option:
	 

	 	(i)    cash in an amount equal to the sum, for each Valid
Day during the Settlement Averaging Period for
such Option, of (i) the Daily Option Value for such
Valid Day, divided by (ii) the number of Valid
Days in the Settlement Averaging Period,
multiplied by (iii) the Cash Percentage; and

	 

	 	(ii)    a number of Shares (the “Combination Settlement
Share Amount”) equal to the sum, for each Valid
Day during the Settlement Averaging Period for
such Option, of (i) the Daily Option Value for such
Valid Day, divided by (ii) the Relevant Price on

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	 	such Valid Day, divided by (iii) the number of
Valid Days in the Settlement Averaging Period,
multiplied by (iv) (A) 100% minus (B) the Cash
Percentage.

	 

	 	Dealer will deliver cash in lieu of any fractional Shares to
be delivered with respect to any Combination Settlement
Share Amount valued at the Relevant Price for the last
Valid Day of the Settlement Averaging Period.
	Cash Settlement:

	 	If Cash Settlement is applicable to any Option exercised
or deemed exercised hereunder, in lieu of Section 8.1 of
the Equity Definitions, Dealer will pay to Counterparty,
on the relevant Settlement Date for each such Option, an
amount of cash equal to the sum, for each Valid Day
during the Settlement Averaging Period for such Option,
of (i) the Daily Option Value for such Valid Day, divided
by (ii) the number of Valid Days in the Settlement
Averaging Period.
	Daily Option Value:

	 	For any Valid Day, an amount equal to (i) the Option
Entitlement on such Valid Day, multiplied by (ii) the
Relevant Price on such Valid Day less the Strike Price on
such Valid Day; provided that if the calculation contained
in clause (ii) above results in a negative number, the Daily
Option Value for such Valid Day shall be deemed to be
zero. In no event will the Daily Option Value be less than
zero.
	Valid Day:

	 	A day on which (i) there is no Market Disruption Event
and (ii) trading in the Shares generally occurs on the
Exchange or, if the Shares are not then listed on the
Exchange, on the principal other U.S. national or regional
securities exchange on which the Shares are then listed or,
if the Shares are not then listed on a U.S. national or
regional securities exchange, on the principal other
market on which the Shares are then listed or admitted for
trading. If the Shares are not so listed or admitted for
trading, “Valid Day” means a Business Day.
	Scheduled Valid Day:

	 	A day that is scheduled to be a Valid Day on the principal
U.S. national or regional securities exchange or market on
which the Shares are listed or admitted for trading. If the
Shares are not so listed or admitted for trading,
“Scheduled Valid Day” means a Business Day.
	Business Day:

	 	Any day other than a Saturday, a Sunday or a day on
which the Federal Reserve Bank of New York is
authorized or required by law or executive order to close
or be closed.
	Relevant Price:

	 	For each of the 50 consecutive Valid Days during the
applicable Settlement Averaging Period, the per Share
volume-weighted average price as displayed under the
heading “Bloomberg VWAP” on Bloomberg page “IART
<equity> AQR” (or its equivalent successor if such page
is not available) in respect of the period from the

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	 	scheduled open of trading until the scheduled clos of
trading of the primary trading session on such Valid Day
(or if such volume-weighted average price is unavailable,
the market value of one Share on such Valid Day
determined, using a volume-weighted average method, by
the Calculation Agent). The Relevant Price shall be
determined without regard to after hours trading or any
other trading outside of the regular trading session trading
hours.
	Settlement Averaging Period:

	 	For any Option and regardless of the Settlement Method
applicable to such Option:
	 

	 	(i)    if the relevant Conversion Date occurs prior to the
Free Convertibility Date, the 50 consecutive
Valid-Day period beginning on, and including, the
second Valid Day after such Conversion Date; and

	 

	 	(ii)    if the relevant Conversion Date occurs on or
following the Free Convertibility Date, the 50
consecutive Valid Days beginning on, and
including, the 52nd Scheduled Valid Day
immediately preceding the Expiration Date.

	Settlement Date:

	 	For any Option, the date Shares and/or cash are delivered
with respect to the Convertible Note related to such
Option pursuant to Section 14.02(a) of the Indenture;
provided that the Settlement Date will not be prior to the
later of (i) the third Business Day immediately following
the final Valid Day of the Settlement Averaging Period
for such Option and (ii) the Exchange Business Day
immediately following the date Counterparty provides
written notice to Dealer of such date of delivery under the
Indenture prior to 4:00 PM, New York City time.
	Settlement Currency:

	 	USD
	Other Applicable Provisions:

	 	The provisions of Sections 9.1(c), 9.8, 9.9 and 9.11 (as
modified below) of the Equity Definitions will be
applicable as if Physical Settlement were applicable.
	Representation and Agreement:

	 	Notwithstanding anything to the contrary in Equity
Definitions (including, but not limited to, Section 9.11
thereof), the parties acknowledge that (i) any Shares
delivered to Counterparty shall be, upon delivery, subject
to restrictions and limitations arising from Counterparty’s
status as issuer of the Shares under applicable securities
laws, (ii) Dealer may deliver any Shares required to be
delivered hereunder in certificated form in lieu of delivery
through the Clearance System and (iii) any Shares
delivered to Counterparty may be “restricted securities”
(as defined in Rule 144 under the Securities Act of 1933,
as amended (the “Securities Act”)).

3. Additional Terms applicable to the Transaction.

	 	 	 

	Adjustments applicable to
the Transaction:
	 	 

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	Potential Adjustment Events:

	 	Notwithstanding Section 11.2(e) of the Equity
Definitions, a “Potential Adjustment Event” means an
occurrence of any event or condition, as set forth in any
Dilution Adjustment Provision, that would result in an
adjustment to the Conversion Rate (as defined in the
Indenture) of the Convertible Notes.
	Method of Adjustment:

	 	Calculation Agent Adjustment, which means that,
notwithstanding Section 11.2(c) of the Equity Definitions,
upon any Potential Adjustment Event, the Calculation
Agent shall make a corresponding adjustment to any one
or more of the Strike Price, Number of Options, Option
Entitlement and any other variable relevant to the
exercise, settlement or payment for the Transaction;
provided that, notwithstanding the foregoing, if any
Potential Adjustment Event occurs during the Settlement
Averaging Period but no adjustment was made to any
Convertible Note under the Indenture because the relevant
Holder (as such term is defined in the Indenture) was
deemed to be a record owner of the underlying Shares on
the related Conversion Date, then the Calculation Agent
shall make an adjustment, as determined by it, to the
terms hereof in order to account for such Potential
Adjustment Event.
	Dilution Adjustment Provisions:

	 	Section 14.04(a), (b), (c), (d) and (e) and Section 14.05 of
the Indenture.

     Extraordinary Events applicable to the Transaction:

	 	 	 

	Merger Events:

	 	Applicable; provided that notwithstanding Section 12.1(b)
of the Equity Definitions, a “Merger Event” means the
occurrence of any event or condition set forth in the
definition of “Merger Event” in Section 14.07(a) of the
Indenture.
	Tender Offers:

	 	Applicable; provided that notwithstanding Section 12.1(d)
of the Equity Definitions, a “Tender Offer” means the
occurrence of any event or condition set forth in Section
14.04(e) of the Indenture.
	Consequence of Merger Events / Tender
Offers:

	 	Notwithstanding Section 12.2 and Section 12.3 of the
Equity Definitions, upon the occurrence of a Merger
Event or a Tender Offer, 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 (in the case of a Merger Event),
Strike Price, Number of Options, Option 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 pursuant to any
Excluded Provision; provided further that if, with respect
to a Merger Event or a Tender Offer, (i) the consideration
for the Shares includes (or, at the option of a holder of
Shares, may include) shares of an entity or person that is

9

 

	 	 	 	 	 

	 

	 	 	 	not a corporation or is not organized under the laws of the
United States, any State thereof or the District of
Columbia or (ii) the Counterparty to the Transaction
following such Merger Event or Tender Offer, will not be
a corporation or will not be the Issuer following such
Merger Event or Tender Offer, then Cancellation and
Payment (Calculation Agent Determination) shall apply.
	 

	 	Nationalization, Insolvency or Delisting:

	 	Cancellation and Payment (Calculation Agent
Determination); provided that, in addition to the
provisions of Section 12.6(a)(iii) of the Equity
Definitions, it will also constitute a Delisting if the
Exchange is located in the United States and the Shares
are not immediately re-listed, re-traded or re-quoted on
any of the New York Stock Exchange, The NASDAQ
Global Select Market or The NASDAQ Global Market (or
their respective successors); if the Shares are immediately
re-listed, re-traded or re-quoted on any of the New York
Stock Exchange, The NASDAQ Global Select Market or
The NASDAQ Global Market (or their respective
successors), such exchange or quotation system shall
thereafter be deemed to be the Exchange.
	 

	 	Additional Disruption Events:
	 	 
	 

	 	     Change in Law:
	 	Applicable; provided that (i) Section 12.9(a)(ii) of the
Equity Definitions is hereby amended by replacing the
parenthetical beginning after the word “regulation” in the
second line thereof with the words “(including, for the
avoidance of doubt and without limitation, (x) any tax law
or (y) adoption or promulgation of new regulations
authorized or mandated by existing statute)” and (ii)
Section 12.9(a)(ii)(X) of the Equity Definitions is hereby
amended by replacing the word “Shares” with the phrase
“Hedge Positions.”
	 

	 	     Failure to Deliver:
	 	Applicable
	 

	 	     Hedging Disruption:
	 	Applicable
	 

	 	     Increased Cost of Hedging:
	 	Applicable
	 

	 	     Hedging Party:
	 	For all applicable Additional Disruption Events, Dealer.
	 

	 	Determining Party:
	 	For all applicable Extraordinary Events, Dealer.
	 

	 	Non-Reliance:
	 	Applicable
	 

	 	Agreements and Acknowledgements	 	 
	 

	 	Regarding Hedging Activities:
	 	Applicable
	 

	 	Additional Acknowledgments:
	 	Applicable
	4.  Calculation Agent.

	 	Dealer, whose judgments, determinations and calculations
shall be made in good faith and in a commercially
reasonable manner. Following any determination or
calculation by the Calculation Agent hereunder, upon a
written request by Counterparty, the Calculation Agent

10

 

	 	 	 	 	 

	 

	 	 	 	will provide to Counterparty by e-mail to the e-mail
address provided by Counterparty in such 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, it being understood
that the Calculation Agent shall not be obligated to
disclose any proprietary models used by it for such
calculation.

5. Account Details.

	 	(a)	 	Account for payments to Counterparty:
	 
	 	 	 	Bank Name: Wells Fargo Bank

ABA #: 121000248

Beneficiary: First Clearing, LLC 

Account #: 4122023377

FFC Account Name: Integra LifeSciences Holdings Corp

FFC Account Number: 8595-0713

	 
	 	 	 	Account for delivery of Shares to Counterparty:
	 
	 	 	 	American Stock Transfer & Trust Co LLC

Transfer Agent # 2941

Account # 10249
	 
	 	(b)	 	Account for payments to Dealer:
	 
	 	 	 	Royal Bank of Canada

JP Morgan Chase NY (CHASUS33)

ABA # 021-000-021

Royal Bank of Canada (ROYCUS3X)

A/C # 920-1-033363

Ref: US Transit

A/C 204-1499
	 
	 	 	 	Account for delivery of Shares from Dealer:
	 
	 	 	 	To be provided by Dealer.

6. Offices.

	 	(a)	 	The Office of Counterparty for the Transaction is: Inapplicable, Counterparty
is not a Multibranch Party.
	 
	 	(b)	 	The Office of Dealer for the Transaction is: New York
	 
	 	 	 	RBC Capital Markets, LLC

as agent for Royal Bank of Canada

3 World Financial Center — 8th Floor

200 Vesey Street

New York, New York 10281-8098

Telephone: 212-858-7000

7. Notices.

	 	(a)	 	Address for notices or communications to Counterparty:

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	 	 	 	Integra LifeSciences Holdings Corporation

311 Enterprise Drive

Plainsboro, NJ 08536

Attention: Treasurer

Telephone No.: (609) 275-0500

Facsimile No.: (609) 750-4264

	 
	 	(b)	 	Address for notices or communications to Dealer:
	 
	 	 	 	Trade Affirmations and Settlements:

RBC Capital Markets, LLC

Attn: Structured Derivatives Documentation

Three World Financial Center

200 Vesey Street

New York, NY 10006-1404 USA

Facsimile Number: +1-212-858-7033

e-Mail Address: geda@rbccm.com

	 
	 	 	 	Trade Confirmations:

RBC Capital Markets, LLC

Attn: Structured Derivatives Documentation 

Three World Financial Center

200 Vesey Street

New York, NY 10281-1021 USA

Facsimile Number: +1-212-428-3053

e-Mail Address: SDD@rbccm.com

8. Representations and Warranties of Counterparty.

	 	 	Each of the representations and warranties of Counterparty set forth in Section 3 of the
Purchase Agreement (the “Purchase Agreement”), dated as of June 9, 2011, between
Counterparty and the representatives of the Initial Purchasers party thereto (the
“Representatives”), is true and correct and is hereby deemed to be repeated to Dealer as if
set forth herein; provided that no such representation or warranty, other than the
representations and warranties set forth in Sections 3(a), (b), (d) and (e) of the Purchase
Agreement, may be the basis of an Event of Default under Section 5(a)(iv) of the Agreement.
Counterparty hereby further represents and warrants to Dealer on the date hereof and on
and as of the Premium Payment Date 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 subject, as to enforceability, to general principles of
equity, including principles of commercial reasonableness, good faith and fair dealing
(regardless of whether enforcement is sought 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 any of its subsidiaries is a party or by which Counterparty or any of its
subsidiaries is bound or to which Counterparty or 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.

12

 

	 	(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 or state securities laws.
	 
	 	(d)	 	Counterparty is not and will not be required to register as an “investment company” as
such term is defined in the Investment Company Act of 1940, as amended.
	 
	 	(e)	 	Counterparty is an “eligible contract participant” (as such term is defined in Section
1a(12) of the Commodity Exchange Act, as amended, other than a person that is an eligible
contract participant under Section 1a(12)(C) of the Commodity Exchange Act).
	 
	 	(f)	 	Each of Counterparty and its officers and directors is not, on the date hereof, in
possession of any material non-public information with respect to Counterparty or the
Shares.

9. Other Provisions.

	 	(a)	 	Opinions. Counterparty shall deliver to Dealer an opinion of counsel, dated as
of the Trade Date, with respect to the matters set forth in Sections 8(a) through (c) of
this Confirmation. Delivery of such opinion to Dealer shall be a condition precedent for
the purpose of Section 2(a)(iii) of the Agreement with respect to each obligation of Dealer
under Section 2(a)(i) of the Agreement.
	 
	 	(b)	 	Repurchase Notices. Counterparty shall, on any day on which Counterparty
effects any repurchase of Shares or consummates or otherwise executes or engages in any
transaction or event (a “Conversion Rate Adjustment Event”) that would lead to an increase
in the Conversion Rate (as such term is defined in the Indenture), promptly give Dealer a
written notice of such repurchase or Conversion Rate Adjustment Event (a “Repurchase
Notice”) on such day if following such repurchase or Conversion Rate Adjustment Event, the
number of outstanding Shares as determined on such day is (i) less than 26,253,195 (in the
case of the first such notice) or (ii) thereafter more than 1,988,648 less than the number
of Shares included in the immediately preceding Repurchase Notice. Counterparty agrees to
indemnify and hold harmless Dealer 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
Dealer’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, that an Indemnified Person may become
subject to, as a result of Counterparty’s failure to provide Dealer 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 Dealer 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 contemplated by this paragraph that is 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 contemplated by this paragraph that is 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

13

 

	 	 	 	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 hereunder, 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 (b) are not exclusive and shall not limit
any rights or remedies that 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.
	 
	 	(c)	 	Regulation M. Counterparty is not on the Trade Date engaged in a distribution,
as such term is used in Regulation M under the Exchange Act, of any securities of
Counterparty, other than a distribution meeting the requirements of the exception set forth
in Rules 101(b)(10) and 102(b)(7) of Regulation M. Counterparty shall not, until the second
Scheduled Trading Day immediately following the Effective Date, engage in any such
distribution.
	 
	 	(d)	 	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) or otherwise
in violation of the Exchange Act.
	 
	 	(e)	 	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 Dealer 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(b) or any
obligations under Section 9(m) or 9(r) of this Confirmation;
	 
	 	(B)	 	Any Transfer Options shall only be transferred or assigned to a third party
that is a United States 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 Dealer, will not expose Dealer to material
risks under applicable securities
laws) and execution of any documentation and delivery of legal opinions with
respect to securities laws and other matters by such third party and Counterparty,
as are requested and reasonably satisfactory to Dealer;
	 
	 	(D)	 	Dealer 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 Dealer 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

14

 

	 	 	 	documentation as may be reasonably requested by Dealer to permit Dealer 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 Dealer in connection with such transfer or assignment.

	 	(ii)	 	Dealer may not, without Counterparty’s consent, transfer or assign all or any part of its
rights or obligations under the Transaction except to any affiliate of Dealer (A) that has a rating
for its long term, unsecured and unsubordinated indebtedness that is equal to or better than
Dealer’s credit rating at the time of such transfer or assignment, or (B) whose obligations
hereunder will be guaranteed, pursuant to the terms of a customary guarantee in a form used by
Dealer generally for similar transactions, by Dealer. If at any time at which (A) the Section 16
Percentage exceeds 7.5%, (B) the Option Equity Percentage exceeds 14.5%, or (C) the Share Amount
exceeds the Applicable Share Limit (if any applies) (any such condition described in clauses (A),
(B) or (C), an “Excess Ownership Position”), Dealer is unable after using its commercially
reasonable efforts to effect a transfer or assignment of Options to a third party on pricing terms
reasonably acceptable to Dealer and within a time period reasonably acceptable to Dealer such that
no Excess Ownership Position exists, then Dealer may designate any Exchange Business Day as an
Early Termination Date with respect to a portion of the Transaction (the “Terminated Portion”),
such that following such partial termination no Excess Ownership Position exists. In the event that
Dealer 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 number of Options underlying the Terminated Portion, (2)
Counterparty were the sole Affected Party with respect to such partial termination and (3) the
Terminated Portion were the sole Affected Transaction (and, for the avoidance of doubt, the
provisions of Section 9(k) shall apply to any amount that is payable by Dealer to Counterparty
pursuant to this sentence as if Counterparty was not the Affected Party). The “Section 16
Percentage” as of any day is the fraction, expressed as a percentage, (A) the numerator of which is
the number of Shares that Dealer and each person subject to aggregation of Shares with Dealer under
Section 13 or Section 16 of the Exchange Act and rules promulgated thereunder directly or
indirectly beneficially own (as defined under Section 13 or Section 16 of the Exchange Act and
rules promulgated thereunder) and (B) the denominator of which is the number of Shares outstanding.
The “Option Equity Percentage” as of any day is the fraction, expressed as a percentage, (A) the
numerator of which is the sum of (1) the product of the Number of Options and the Option
Entitlement and (2) the aggregate number of Shares underlying any other call option transaction
sold by Dealer to Counterparty, and (B) the denominator of which is the number of Shares
outstanding. The “Share Amount” as of any day is the number of Shares that Dealer and any person
whose ownership position would be aggregated with that of Dealer (Dealer or any such person, a
“Dealer Person”) under any law, rule, regulation, regulatory order or organizational documents or
contracts of Counterparty that are, in each case, applicable to ownership of Shares
(“Applicable Restrictions”), owns, beneficially owns, constructively owns, controls, holds the
power to vote or otherwise meets a relevant definition of ownership under any Applicable
Restriction, as determined by Dealer in its reasonable discretion. The “Applicable Share Limit”
means a number of Shares equal to (A) the minimum number of Shares that could give rise to
reporting or registration obligations (except for any filings of Schedule 13D or Schedule 13G under
the Exchange Act or any other filing obligations applicable as of the date hereof) or other
requirements (including obtaining prior approval from any person or entity) of a Dealer Person, or
could result in an adverse effect on a Dealer Person, under any Applicable Restriction, as
determined by Dealer in its reasonable discretion, minus (B) 1% of the number of Shares
outstanding.

15

 

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

	 	(f)	 	Staggered Settlement. If upon advice of counsel with respect to applicable
legal and regulatory requirements, including any requirements relating to Dealer’s hedging
activities hereunder, Dealer reasonably determines that it would not be advisable to
deliver, or to acquire Shares to deliver, any or all of the Shares to be delivered by
Dealer on the Settlement Date for the Transaction, Dealer 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:

	 	(i)	 	in such notice, Dealer will specify to Counterparty the related Staggered Settlement
Dates (each of which will be on or prior to such Nominal Settlement Date) and the number of
Shares that it will deliver on each Staggered Settlement Date;
	 
	 	(ii)	 	the aggregate number of Shares that Dealer will deliver to Counterparty hereunder on
all such Staggered Settlement Dates will equal the number of Shares that Dealer would
otherwise be required to deliver on such Nominal Settlement Date; and
	 
	 	(iii)	 	if the Net Share Settlement terms set forth above were to apply on the Nominal
Settlement Date, then the Net Share Settlement terms will apply on each Staggered
Settlement Date, except that the Net Shares will be allocated among such Staggered
Settlement Dates as specified by Dealer in the notice referred to in clause (i) above.

	 	(g)	 	Disclosure of Agency Relationship. Dealer has appointed, as its agent, its indirect
wholly-owned subsidiary, RBC Capital Markets, LLC (“RBCCM”), for purposes of conducting, on
Dealer’s behalf, a business in privately negotiated transactions in options and other derivatives.
Counterparty hereby is advised that Dealer, the principal and stated counterparty
in such transactions, duly has authorized RBCCM to market, structure, negotiate,
document, price, execute and hedge transactions in over-the-counter derivative
products.
	 
	 	(h)	 	Additional Termination Events.

	 	(i)	 	Notwithstanding anything to the contrary in this Confirmation if (i) an event
of default with respect to Counterparty occurs under the terms of the Convertible
Notes as set forth in Section 6.01 of the Indenture or (ii) Counterparty gives
Dealer the notice required pursuant to the last sentence of this paragraph, then
such occurrence or the giving of such notice, as applicable, shall constitute an
Additional Termination Event
applicable to the Transaction and, with respect to such Additional Termination
Event, (A) Counterparty shall be deemed to be the sole Affected Party, (B) the
Transaction shall be the sole Affected Transaction and (C) Dealer shall be the
party entitled to designate an Early Termination Date pursuant to Section 6(b) of
the Agreement (which Early Termination Date shall correspond in the case of a
Repurchase Event (as defined below), if applicable, to a payment date under Section
6(d)(ii) of the Agreement occurring within a commercially reasonable period of time
(as determined by Dealer in a commercially reasonable manner in consultation with
counsel with regard to legal, regulatory or commercial issues arising in connection
with any related hedging or hedge unwind activities) after the date of payment with
respect to the Convertible Notes, if applicable, for such Repurchase Event) and
determine the amount payable pursuant to Section 6(e) of the Agreement; provided
that in the case of a Repurchase Event, the Transaction shall be subject to
termination only in respect of a number of Options (the “Affected Number

16

 

	 	 	 	of Options”), equal to the lesser of (A) the number of Convertible Notes that cease to be
outstanding in connection with or as a result of such Repurchase Event, as the case may be,
and (B) the number of Options then outstanding. For the avoidance of doubt, in determining
the amount payable in respect of such Affected Transaction pursuant to Section 6 of the
Agreement in connection with a Repurchase Event, the Calculation Agent shall assume that
the Convertible Notes subject to such Repurchase Event shall not have been repurchased and
remain outstanding. Counterparty shall notify Dealer promptly following the occurrence of
any Repurchase Event; provided that Counterparty agrees to initiate a Repurchase Event only
if Counterparty represents to Dealer at the time it takes action to so initiate such
Repurchase Event that it is not in possession of any material nonpublic information with
respect to Counterparty or the Shares.
	 
	 	 	 	“Repurchase Event” means that (i) any Convertible Notes are repurchased (whether in
connection with or as a result of a fundamental change, howsoever defined, a tender offer
or similar transaction or for any other reason) by Counterparty, (ii) any Convertible Notes
are delivered to Counterparty in exchange for delivery of any property or assets of
Counterparty (howsoever described), (iii) any principal of any of the Convertible Notes is
repaid prior to the final maturity date of the Convertible Notes (whether following
acceleration of the Convertible Notes or otherwise), or (iv) any Convertible Notes are
exchanged by or for the benefit of the holders thereof for any other securities of
Counterparty (or any other property, or any combination thereof) pursuant to any exchange
offer or similar transaction. For the avoidance of doubt, any conversion of Convertible
Notes pursuant to the terms of the Indenture shall not constitute a Repurchase Event.
	 
	 	(ii)	 	Notwithstanding anything to the contrary in this Confirmation, the receipt by Dealer from
Counterparty, within the applicable time period set forth under “Notice of Exercise” above, of any
Notice of Exercise in respect of Options that relate to Convertible Notes as to which additional
Shares would be added to the Conversion Rate pursuant to Section 14.03 of the Indenture in
connection with a “Make-Whole Fundamental Change” (as defined in the Indenture) shall constitute an
Additional Termination Event as provided in this Section 9(h)(ii). Upon receipt of any such Notice
of Exercise, Dealer shall designate an Exchange Business Day following such Additional Termination
Event (which Exchange Business Day shall in no event be earlier than the related settlement date
for such Convertible Notes) as an Early Termination Date with respect to the portion of this
Transaction corresponding to a number of Options (the “Make-Whole Conversion Options”) equal to the
lesser of (A) the number of such Options specified in such Notice of Exercise and (B) the Number of
Options as of the date Dealer designates such Early Termination Date and, as of such date, the
Number of Options shall be reduced by the number of Make-Whole Conversion Options. Any payment
hereunder with respect to such termination shall be calculated pursuant to Section 6 of the
Agreement as if (1) an Early Termination Date had been designated in respect of a Transaction
having terms identical to this Transaction and a Number of Options equal to the number of
Make-Whole Conversion Options, (2) Counterparty were the sole Affected Party with respect to such
Additional Termination Event and (3) the terminated portion of the Transaction were the sole
Affected Transaction (and, for the avoidance of doubt, in determining the amount payable pursuant
to Section 6 of
the Agreement, the Calculation Agent shall not take into account any adjustments to the Option
Entitlement that result from corresponding adjustments to the Conversion Rate pursuant to Section
14.03 of the Indenture); provided that the amount of cash deliverable in respect of such early
termination by Dealer to Counterparty shall not be greater than the product of (x) the Applicable
Percentage and (y) the excess of (I) (1) the number of Make-Whole Conversion Options multiplied by
(2) the Conversion Rate (after taking into account any applicable adjustments to the Conversion
Rate pursuant to Section 14.03 of the Indenture) multiplied by (3) a price per Share determined by
the Calculation Agent over (II) the aggregate principal amount of such Convertible Notes, as
determined by the Calculation Agent in a commercially reasonable manner.

17

 

	 	(i)	 	Amendments to Equity Definitions.

	 	(i)	 	Section 12.6(a)(ii) of the Equity Definitions is hereby amended by (1) deleting from
the fourth line thereof the word “or” after the word “official” and inserting a comma
therefor, and (2) deleting the semi-colon at the end of subsection (B) thereof and
inserting the following words therefor “or (C) at Dealer’s option, the occurrence of any of
the events specified in Section 5(a)(vii)(1) through (9) of the ISDA Master Agreement with
respect to that Issuer.”
	 
	 	(ii)	 	Section 12.9(b)(i) of the Equity Definitions is hereby amended by (1) replacing
“either party may elect” with “Dealer may elect” and (2) replacing “notice to the other
party” with “notice to Counterparty” in the first sentence of such section.

	 	(j)	 	No Set-off. Each party waives any and all rights it may have to set off obligations
arising under the Agreement and the Transaction against other obligations between the parties,
whether arising under any other agreement, applicable law or otherwise.
	 
	 	(k)	 	Alternative Calculations and Payment on Early Termination and on Certain Extraordinary
Events. If in respect of the Transaction, an amount is payable by Dealer to Counterparty (i)
pursuant to Section 12.7 or Section 12.9 of the Equity Definitions or (ii) pursuant to Section
6(d)(ii) of the Agreement (any such amount, a “Payment Obligation”), Counterparty may request
Dealer to satisfy the Payment Obligation by the Share Termination Alternative (as defined below)
(except that Counterparty shall not have the right to make such an election in the event of (I) a
Nationalization, Insolvency, Merger Event or Tender Offer, in each case, in which the consideration
to be paid to holders of Shares consists solely of cash, (II) a Merger Event or Tender Offer that
is within Counterparty’s control, or (III) 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 Dealer, confirmed in writing within one Scheduled Trading Day, no
later than 12:00 p.m. (New York City time) on the Merger Date, the Tender Offer Date, the
Announcement Date (in the case of Nationalization, Insolvency or Delisting), the Early Termination
Date or date of cancellation, as applicable; provided that if Counterparty does not validly request
Dealer to satisfy the Payment Obligation by the Share Termination Alternative, Dealer 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:

	 	If applicable, Dealer shall deliver to Counterparty the
Share Termination Delivery Property on, or within a
commercially reasonable period of time after, the
date when the relevant Payment Obligation would
otherwise be due pursuant to Section 12.7 or 12.9 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
such 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

18

 

	 	 	 

	 

	 	fractional security based on the values used to
calculate the Share Termination Unit Price.
	Share Termination Unit Price:

	 	The value to Dealer of property contained in one
Share Termination Delivery Unit, as determined by
the Calculation Agent in its discretion by
commercially reasonable means and notified by the
Calculation Agent to Dealer at the time of
notification of the Payment Obligation. 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 9.8, 9.9 and 9.11 (as modified
above) of the Equity Definitions and the provisions
set forth opposite the caption “Representation and
Agreement” in Section 2 will be applicable as if
Physical Settlement were applicable.

	 	(l)	 	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.
	 
	 	(m)	 	Registration. Counterparty hereby agrees that if, in the good faith reasonable judgment
of Dealer based on the advice of counsel, the Shares (“Hedge Shares”) acquired by Dealer for the
purpose of hedging its obligations pursuant to the Transaction cannot be sold in the public market
by Dealer without registration under the Securities Act, Counterparty shall, at its election,
either (i) in order to allow Dealer to sell the Hedge Shares in a registered offering, make
available to Dealer an effective registration statement under the Securities Act and enter into an
agreement, in form and substance satisfactory to Dealer, substantially in the form of an
underwriting agreement for a registered secondary offering of substantially similar size; provided,
however, that if Dealer, in its sole reasonable discretion, is not satisfied with access to due
diligence materials, the results of its due diligence investigation, or the procedures and
documentation for the registered offering referred to above, then clause (ii) or clause (iii) of
this paragraph shall apply at the election of Counterparty, (ii) in order to allow Dealer to sell
the Hedge Shares in a private placement, enter into a private placement agreement substantially
similar to private placement purchase agreements customary for private placements of equity
securities of substantially similar size, in form and substance satisfactory to Dealer (in which
case, the Calculation Agent shall make any adjustments to the terms of the Transaction that are
necessary, in its reasonable judgment, to compensate

19

 

	 	 	 	Dealer for any discount from the public market price of the Shares incurred on the sale of
Hedge Shares in a private placement), or (iii) purchase the Hedge Shares from Dealer at the
Relevant Price on such Exchange Business Days, and in the amounts, requested by Dealer.
	 
	 	(n)	 	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.
	 
	 	(o)	 	Right to Extend. Dealer may postpone or add, in whole or in part, any Valid Day or
Valid Days during the Settlement Averaging Period or any other date of valuation, payment or
delivery by Dealer, with respect to some or all of the Options hereunder, if Dealer reasonably
determines based on the advice of counsel, in its discretion, that such action is reasonably
necessary or advisable to preserve Dealer’s hedging or hedge unwind activity hereunder in light of
existing liquidity conditions or to enable Dealer to effect purchases of Shares in connection with
its hedging, hedge unwind or settlement activity hereunder in a manner that would, if Dealer were
Counterparty or an affiliated purchaser of Counterparty, be in compliance with applicable legal,
regulatory or self-regulatory requirements, or with related policies and procedures applicable to
Dealer.
	 
	 	(p)	 	Status of Claims in Bankruptcy. Dealer acknowledges and agrees that this Confirmation
is not intended to convey to Dealer rights against Counterparty with respect to the Transaction
that are senior to the claims of common stockholders of Counterparty in any United States
bankruptcy proceedings of Counterparty; provided that nothing herein shall limit or shall be deemed
to limit Dealer’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 Dealer’s rights in respect of any transactions other than
the Transaction.
	 
	 	(q)	 	Securities Contract; Swap Agreement. The parties hereto intend for (i) the Transaction
to be a “securities contract” and a “swap agreement” 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)(17), 546(e), 546(g), 555
and 560 of the Bankruptcy Code, (ii) a party’s right to liquidate the Transaction and to exercise
any other remedies upon the occurrence of any Event of Default under the Agreement with respect to
the other party to constitute a “contractual right” as described in the Bankruptcy Code, and (iii)
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.
	 
	 	(r)	 	Notice of Certain Other Events. Counterparty covenants and agrees that:

	 	(i)	 	promptly following the public announcement of the results of any election by the
holders of Shares with respect to the consideration due upon consummation 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
give Dealer written notice 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; and
	 
	 	(ii)	 	promptly following any adjustment to the Convertible Notes in connection with any
Potential Adjustment Event, Merger Event or Tender Offer, Counterparty shall give Dealer
written notice of the details of such adjustment.

20

 

	 	(s)	 	Wall Street Transparency and Accountability Act. In connection with Section
739 of the Wall Street Transparency and Accountability Act of 2010 (“WSTAA”), the parties
hereby agree that neither the enactment of WSTAA or any regulation under the WSTAA, nor any
requirement under WSTAA or an amendment made by WSTAA, shall limit or otherwise impair
either party’s otherwise applicable rights to terminate, renegotiate, modify, amend or
supplement this Confirmation or the Agreement, as applicable, arising from a termination
event, force majeure, illegality, increased costs, regulatory change or similar event under
this Confirmation, the Equity Definitions incorporated herein, or the Agreement (including,
but not limited to, rights arising from Change in Law, Hedging Disruption, Increased Cost
of Hedging, an Excess Ownership Position, or Illegality (as defined in the Agreement)).
	 
	 	(t)	 	Early Unwind. In the event the sale of the “Underwritten Securities” (as
defined in the Purchase Agreement) is not consummated with the Representatives for any
reason, or Counterparty fails to deliver to Dealer opinions of counsel as required pursuant
to Section 9(a), in each case by 5:00 p.m. (New York City time) on the Premium Payment
Date, or such later date as agreed upon by the parties (the Premium Payment Date 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 Dealer 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 in
cases involving a breach of the Purchase Agreement by Dealer, Counterparty shall purchase
from Dealer on the Early Unwind Date all Shares purchased by Dealer or one or more of its
affiliates in connection with the Transaction at the then prevailing market price. Each of
Dealer and Counterparty represents and acknowledges to the other that, subject to the
proviso included in this Section 9(r), upon an Early Unwind, all obligations with respect
to the Transaction shall be deemed fully and finally discharged.
	 
	 	(u)	 	Payment by Counterparty. In the event that (i) an Early Termination Date occurs
or is designated with respect to the Transaction as a result of a Termination Event or an
Event of Default (other than an Event of Default arising under Section 5(a)(ii) or 5(a)(iv)
of the Agreement) and, as a result, Counterparty owes to Dealer an amount calculated under
Section 6(e) of the Agreement, or (ii) Counterparty owes to Dealer, pursuant to Section
12.7 or Section 12.9 of the Equity Definitions, an amount calculated under Section 12.8 of
the Equity Definitions, such amount shall be deemed to be zero.

[Remainder of Page Intentionally Blank]

21

 

     Please confirm that the foregoing correctly sets forth the terms of our agreement by
executing this Confirmation and returning it to RBC Capital Markets,
LLC, Attn: Structured
Derivatives Documentation, Three World Financial Center, 200 Vesey Street, New York, NY 10281-1021,
or by fax to (212) 428-3053, or by email to SDD@rbccm.com.

Very truly yours,

	 	 	 	 	 	 	 

	 	 	RBC Capital Markets, LLC, as agent for Royal
Bank of Canada	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Brian Ward
 

Authorized Signatory 

Name: Brian Ward
	 	 

Accepted and
confirmed as of the Trade Date:

Integra LifeSciences Holdings Corporation

By: /s/ Stuart M. Essig, CEO                    

Authorized Signatory

Name: Stuart M. Essig, CEO

[RBC Bond Hedge Confirmation]exv10w9

Exhibit 10.9

EXECUTION VERSION

Deutsche Bank AG, London Branch

Winchester House

1 Great Winchester Street

London EC2N 2DB

Telephone: 44 20 7545 8000

c/o Deutsche Bank Securities Inc.

60 Wall Street

New York, NY 10005

Telephone: 1-212-250-2500

Internal Reference Nr.: 440007

June 14, 2011

	 	 	 	 	 

	To:

	 	Integra LifeSciences Holdings Corporation
	 	 
	 

	 	311 Enterprise Drive	 	 
	 

	 	Plainsboro, NJ 08536	 	 
	 

	 	Attention: Treasurer	 	 
	 

	 	Telephone No.: (609) 275-0500	 	 
	 

	 	Facsimile No.: (609) 750-4264	 	 

Re:            Additional Call Option Transaction

     DEUTSCHE BANK AG IS NOT REGISTERED AS A BROKER DEALER UNDER THE U.S. SECURITIES EXCHANGE ACT
OF 1934. DEUTSCHE BANK SECURITIES INC. (“DBSI”) HAS ACTED SOLELY AS AGENT IN CONNECTION WITH THIS
TRANSACTION AND HAS NO OBLIGATION, BY WAY OF ISSUANCE, ENDORSEMENT, GUARANTEE OR OTHERWISE WITH
RESPECT TO THE PERFORMANCE OF EITHER PARTY UNDER THE TRANSACTION. AS SUCH, ALL DELIVERY OF FUNDS,
ASSETS, NOTICES, DEMANDS AND COMMUNICATIONS OF ANY KIND RELATING TO THIS TRANSACTION BETWEEN
DEUTSCHE BANK AG AND COUNTERPARTY SHALL BE TRANSMITTED THROUGH DBSI. DEUTSCHE BANK AG ACTING
THROUGH ITS LONDON BRANCH IS NOT A MEMBER OF THE SECURITIES INVESTOR PROTECTION CORPORATION (SIPC).

     The purpose of this letter agreement (this “Confirmation”) is to confirm the terms and
conditions of the call option transaction entered into between Deutsche Bank AG, London Branch
(“Dealer”) and Integra LifeSciences Holdings Corporation (“Counterparty”) as of 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 2002 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 are based on terms that are defined in the Offering Memorandum dated June 9, 2011 (the
"Offering Memorandum”) relating to the 1.625% Convertible Senior Notes

	 	 	 

	Chairman of the Supervisory Board: Clemens Börsig
Management Board: Josef Ackermann (Chairman), Hugo
Bänziger, Jürgen Fitschen, Anshuman Jain, Stefan
Krause, Hermann-Josef Lamberti, Rainer Neske

	 	Deutsche Bank AG is
authorized under German
Banking Law (competent
authority: BaFin – Federal
Financial Supervising
Authority) and regulated by
the Financial Services
Authority for the conduct of
UK business; a member of the
London Stock Exchange.
Deutsche Bank AG is a joint
stock corporation with
limited liability
incorporated in the Federal
Republic of Germany HRB No.
30 000 District Court of
Frankfurt am Main; Branch
Registration in England and
Wales BR000005; Registered
address: Winchester House, 1
Great Winchester Street,
London EC2N 2DB. Deutsche
Bank Group online:
	 

	 	http://www.deutsche-bank.com

 

 

due 2016 (as originally
issued by Counterparty, the “Convertible Notes” and each USD 1,000 principal amount of
Convertible Notes, a “Convertible Note”) issued by Counterparty in an aggregate initial
principal amount of USD 230,000,000 pursuant to an Indenture to be dated June 15, 2011 between
Counterparty and Wells Fargo Bank, National Association, as trustee (the “Indenture”). In the
event of any inconsistency between the terms defined in the Offering Memorandum, 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 that 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 Offering
Memorandum. For the avoidance of doubt, references herein to sections of the Indenture are based
on the draft of the Indenture most recently reviewed by the parties at the time of execution of
this Confirmation. If any relevant sections of the Indenture are changed, added or renumbered
following execution of this Confirmation but prior to the execution of the Indenture, the parties
will amend this Confirmation in good faith to preserve the economic intent of the parties based on
the draft of the Indenture so reviewed. The parties further acknowledge that 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 Dealer and Counterparty 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 Dealer and Counterparty had executed an agreement in such form
(but without any Schedule except for (i) the election of the laws of the State of New York as the
governing law (without reference to choice of law doctrine); (ii) the election that the “Cross
Default” provisions of Section 5(a)(vi) of the Agreement shall apply to both parties, provided that
(a) the phrase “or becoming capable at such time of being declared” shall be deleted from clause
(1) of such Section 5(a)(vi); (b) the following language shall be added to the end thereof:
“Notwithstanding the foregoing, a default under subsection (2) hereof shall not constitute an Event
of Default if (i) the default was caused solely by error or omission of an administrative or
operational nature; (ii) funds were available to enable the party to make the payment when due; and
(iii) the payment is made within two Local Business Days of such party’s receipt of written notice
of its failure to pay.”; (c) “Specified Indebtedness” will have the meaning specified in Section 14
of the Agreement, except that such term shall not include obligations in respect of deposits
received in the ordinary course of a party’s banking business; and (d) “Threshold Amount” means in
relation to Dealer, three percent (3%) of shareholders’ equity of Deutsche Bank AG (the “Dealer
Parent”) and in relation to Counterparty, USD 25 million.)) on the Trade Date. In the event of any
inconsistency between provisions of the 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:

	 	June 14, 2011
	 
	 	 
	     Effective Date:

	 	The third Exchange Business Day immediately prior to the Premium Payment
Date
	 
	 	 
	     Option Style:

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

	 	Call
	 
	 	 
	     Buyer:

	 	Counterparty
	 
	 	 
	     Seller:

	 	Dealer

2

 

	 	 	 

	     Shares:

	 	The common stock of Counterparty, par value USD0.01 per share (Exchange symbol
“IART”).
	 
	 	 
	     Number of Options:

	 	30,000. For the avoidance of doubt, the Number of Options shall be
reduced by any Options exercised by Counterparty. In no event will the Number of
Options be less than zero.
	 
	 	 
	     Applicable Percentage:

	 	20%
	 
	 	 
	     Option Entitlement:

	 	A number equal to the product of the Applicable Percentage and 17.4092.
	 
	 	 
	     Strike Price:

	 	USD 57.441
	 
	 	 
	     Premium:

	 	USD 1,119,000
	 
	 	 
	     Premium Payment Date:

	 	June 15, 2011
	 
	 	 
	     Exchange:

	 	The NASDAQ Global Select Market
	 
	 	 
	     Related Exchange(s):

	 	All Exchanges
	 
	 	 
	     Excluded Provisions:

	 	Section 14.03 and Section 14.04(g) of the Indenture.
	 
	 	 
	Procedures for Exercise.
	 	 
	 
	 	 
	     Conversion Date:

	 	With respect to any conversion of a Convertible Note, the date on which
the Holder (as such term is defined in the Indenture) of such Convertible Note
satisfies all of the requirements for conversion thereof as set forth in Sections
14.02(b) and (c) of the Indenture.
	 
	 	 
	     Free Convertibility Date:

	 	June 15, 2016
	 
	 	 
	     Expiration Time:

	 	The Valuation Time
	 
	 	 
	     Expiration Date:

	 	December 15, 2016, subject to earlier exercise.
	 
	 	 
	     Multiple Exercise:

	 	Applicable, as described under “Automatic Exercise” below.
	 
	 	 
	     Automatic Exercise:

	 	Notwithstanding Section 3.4 of the Equity Definitions, on each
Conversion Date, a number of Options equal to (i) the number of Convertible Notes
in denominations of USD 1,000 as to which such Conversion Date has occurred minus
(ii) the number of Options that are or are deemed to be automatically exercised on
such Conversion Date under the Base Call Option Transaction Confirmation letter
agreement dated June 9, 2011 between Dealer and Counterparty (the “Base Call
Option Confirmation”), shall be deemed to be automatically exercised; provided that
such Options shall be exercised or deemed to be exercised only if Counterparty has
provided a Notice of Exercise to Dealer in accordance with “Notice of Exercise”
below.

3

 

	 	 	 

	 

	 	Notwithstanding the foregoing, in no event shall
the number of Options that are exercised or
deemed exercised hereunder exceed the Number of
Options.
	 
	 	 
	     Notice of Exercise:

	 	Notwithstanding anything to the contrary in the Equity Definitions
or under “Automatic Exercise” above, in order to exercise any Options, Counterparty
must notify Dealer in writing before (i) 5:00 p.m. (New York City time) on the
Scheduled Valid Day immediately preceding the scheduled first day of the Settlement
Averaging Period for the Options being exercised or (ii) 5:00 p.m. (New York City
time) on the fifth Scheduled Valid Day immediately following the scheduled first
day of the Settlement Averaging Period for the Options being exercised (in which
case the Calculation Agent will determine the adjustment to be made to any one or
more of the Strike Price, Number of Options, Option Entitlement and any other
variable relevant to the exercise, settlement or payment for the Transaction in a
commercially reasonable manner as appropriate to reflect the additional costs
(including, but not limited to, hedging mismatches and market losses) and
reasonable expenses incurred by Dealer in connection with its hedging activities
(including the unwinding of any hedge position) due to such notification occurring
after the time specified in the immediately preceding clause (i)) of (w) the number
of such Options (without regard to any adjustments by the Calculation Agent in
accordance with the immediately preceding clause (ii)) and (x) the scheduled first
day of the Settlement Averaging Period and the scheduled Settlement Date, (y) the
Relevant Settlement Method for such Options, and (z) if the Relevant Settlement
Method for such Options is not Net Share Settlement (as defined below), the
percentage of each Share issuable upon conversion in excess of the principal
portion of the Convertible Notes being converted that will be paid in cash (the
"Cash Percentage”), and such notice shall also include the information,
representations, acknowledgements and agreements required pursuant to “Settlement
Method Election Conditions” below; provided that in respect of any Options relating
to Convertible Notes with a Conversion Date occurring on or after the Free
Convertibility Date, (A) such notice may be given on or prior to the second
Scheduled Valid Day immediately preceding the Expiration Date and need only specify
the information required in clause (w) above, and (B) if the Relevant Settlement
Method for such Options is not Net Share Settlement, Dealer shall have received a
separate notice (the “Notice of Final Settlement Method”) in respect of all such
Convertible Notes before 5:00 p.m. (New York City time) on or prior to the Free
Convertibility Date specifying the information required in clauses (y) and (z)
above, as well as the information, representations, acknowledgements and agreements
required pursuant to “Settlement Method Election Conditions” below.

4

 

	 	 	 

	     Valuation Time:

	 	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.
	 
	 	 
	     Market Disruption Event:

	 	Section 6.3(a) of the Equity Definitions is hereby replaced in
its entirety by the following:
	 
	 	 
	 

	 	‘Market Disruption Event’ means, in respect of a
Share, (i) a failure by the primary U.S. national
or regional securities exchange or market on
which the Shares are listed or admitted for
trading to open for trading during its regular
trading session or (ii) the occurrence or
existence prior to 1:00 p.m., New York City time,
on any Scheduled Valid Day for the Shares for
more than one half-hour period in the aggregate
during regular trading hours of any suspension or
limitation imposed on trading (by reason of
movements in price exceeding limits permitted by
the relevant stock exchange or otherwise) in the
Shares or in any options, contracts or future
contracts relating to the Shares.”
	 
	 	 
	Settlement Terms.
	 	 
	 
	 	 
	     Settlement Method:

	 	For any Option, Net Share Settlement; provided that if the Relevant
Settlement Method set forth below for such Option is not Net Share Settlement, then
the Settlement Method for such Option shall be such Relevant Settlement Method, but
only if the Settlement Method Election Conditions have been satisfied and
Counterparty shall have notified Dealer of the Relevant Settlement Method in the
Notice of Exercise or Notice of Final Settlement Method, as applicable, for such
Option.
	 
	 	 
	     Relevant Settlement Method:

	 	In respect of any Option, subject to the Settlement Method
Election Conditions:
	 
	 	 
	 

	 	(i) if Counterparty has not specified a Cash
Percentage or has specified a Cash Percentage of
0% in respect of settling its conversion
obligations in respect of the related Convertible
Note pursuant to Section 14.02(a)(i) of the
Indenture, then, in either case, the Relevant
Settlement Method for such Option shall be Net
Share Settlement;
	 
	 	 
	 

	 	(ii) if Counterparty has specified a Cash
Percentage of between 0% and 100% in respect of
settling its conversion obligations in respect of
the related Convertible Note pursuant to Section
14.02(a)(i) of the Indenture, then the Relevant
Settlement Method for such Option shall be
Combination Settlement; and
	 
	 	 
	 

	 	(iii) if Counterparty has specified a Cash
Percentage of 100% in respect of settling its
conversion obligations in respect of the related
Convertible Note pursuant to Section 14.02(a)(i)
of the Indenture, then the Relevant Settlement
Method for such Option shall be Cash Settlement.

5

 

	 	 	 

	     Settlement Method Election Conditions:

	 	For any Relevant Settlement Method other than Net
Share Settlement, such Relevant Settlement Method shall apply to an Option only if
the Notice of Exercise or Notice of Final Settlement Method for such Option, as
applicable, contains:

	 	(i)	 	a representation that, on the date of such
Notice of Exercise or Notice of Final
Settlement Method, as applicable,
Counterparty is not in possession of any
material non-public information with respect
to Counterparty or the Shares;
	 
	 	(ii)	 	a representation that Counterparty is
electing the settlement method for the
related Convertible Note and such Relevant
Settlement Method 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”);
	 
	 	(iii)	 	a representation that Counterparty has not
entered into or altered any hedging
transaction relating to the Shares
corresponding to or offsetting the
Transaction;
	 
	 	(iv)	 	a representation that Counterparty is not
electing the settlement method for the
related Convertible Note and such Relevant
Settlement Method 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); and
	 
	 	(v)	 	an acknowledgment by Counterparty that (A)
any transaction by Dealer following
Counterparty’s election of the settlement
method for the related Convertible Note and
such Relevant Settlement Method shall be
made at Dealer’s sole discretion and for
Dealer’s own account and (B) Counterparty
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.

	 	 	 

	     Net Share Settlement:

	 	If Net Share Settlement is applicable to any Option
exercised or deemed exercised hereunder, Dealer will deliver to Counterparty, on
the relevant Settlement Date for each such Option, a number of Shares (the “Net
Share Settlement Amount”) equal to the sum, for each Valid Day during the
Settlement Averaging Period for each such Option, of (i) the Daily Option Value for
such Valid Day, divided by (ii) the Relevant Price on such Valid Day,

6

 

	 	 	 

	 

	 	divided by (iii) the number of Valid Days in the
Settlement Averaging Period.
	 
	 	 
	 

	 	Dealer will deliver cash in lieu of any
fractional Shares to be delivered with respect to
any Net Share Settlement Share Amount valued at
the Relevant Price for the last Valid Day of the
Settlement Averaging Period.

	 	 	 

	     Combination Settlement:

	 	If Combination Settlement is applicable to any Option exercised
or deemed exercised hereunder, Dealer will pay or deliver, as the case may be, to
Counterparty, on the relevant Settlement Date for each such Option:

	 	(i)	 	cash in an amount equal to the sum, for
each Valid Day during the Settlement
Averaging Period for such Option, of (i) the
Daily Option Value for such Valid Day,
divided by (ii) the number of Valid Days in
the Settlement Averaging Period, multiplied
by (iii) the Cash Percentage; and
	 
	 	(ii)	 	a number of Shares (the “Combination
Settlement Share Amount”) equal to the sum,
for each Valid Day during the Settlement
Averaging Period for such Option, of (i) the
Daily Option Value for such Valid Day,
divided by (ii) the Relevant Price on such
Valid Day, divided by (iii) the number of
Valid Days in the Settlement Averaging
Period, multiplied by (iv) (A) 100% minus
(B) the Cash Percentage.
	 
	 	Dealer will deliver cash in lieu of any
fractional Shares to be delivered with respect to
any Combination Settlement Share Amount valued at
the Relevant Price for the last Valid Day of the
Settlement Averaging Period.

	 	 	 

	     Cash Settlement:

	 	If Cash Settlement is applicable to any Option exercised or
deemed exercised hereunder, in lieu of Section 8.1 of the Equity Definitions,
Dealer will pay to Counterparty, on the relevant Settlement Date for each such
Option, an amount of cash equal to the sum, for each Valid Day during the
Settlement Averaging Period for such Option, of (i) the Daily Option Value for such
Valid Day, divided by (ii) the number of Valid Days in the Settlement Averaging
Period.
	 
	 	 
	     Daily Option Value:

	 	For any Valid Day, an amount equal to (i) the Option
Entitlement on such Valid Day, multiplied by (ii) the Relevant Price on such Valid
Day less the Strike Price on such Valid Day; provided that if the calculation
contained in clause (ii) above results in a negative number, the Daily Option Value
for such Valid Day shall be deemed to be zero. In no event will the Daily Option
Value be less than zero.
	 
	 	 
	     Valid Day:

	 	A day on which (i) there is no Market Disruption Event and (ii)
trading in the Shares generally occurs on the Exchange or, if the Shares are not
then listed on the Exchange, on the principal other U.S. national or regional

7

 

	 	 	 

	 

	 	securities exchange on which the Shares are then
listed or, if the Shares are not then listed on a
U.S. national or regional securities exchange, on
the principal other market on which the Shares
are then listed or admitted for trading. If the
Shares are not so listed or admitted for trading,
“Valid Day” means a Business Day.
	 
	 	 
	     Scheduled Valid Day:

	 	A day that is scheduled to be a Valid Day on the principal U.S.
national or regional securities exchange or market on which the Shares are listed
or admitted for trading. If the Shares are not so listed or admitted for trading,
“Scheduled Valid Day” means a Business Day.
	 
	 	 
	     Business Day:

	 	Any day other than a Saturday, a Sunday or a day on which the Federal
Reserve Bank of New York is authorized or required by law or executive order to
close or be closed.
	 
	 	 
	     Relevant Price:

	 	For each of the 50 consecutive Valid Days during the applicable
Settlement Averaging Period, the per Share volume-weighted average price as
displayed under the heading “Bloomberg VWAP” on Bloomberg page “IART <equity>
AQR” (or its equivalent successor if such page is not available) in respect of the
period from the scheduled open of trading until the scheduled clos of trading of
the primary trading session on such Valid Day (or if such volume-weighted average
price is unavailable, the market value of one Share on such Valid Day determined,
using a volume-weighted average method, by the Calculation Agent). The Relevant
Price shall be determined without regard to after hours trading or any other
trading outside of the regular trading session trading hours.
	 
	 	 
	     Settlement Averaging Period:

	 	For any Option and regardless of the Settlement Method
applicable to such Option:

	 	(i)	 	if the relevant Conversion Date occurs
prior to the Free Convertibility Date, the
50 consecutive Valid-Day period beginning
on, and including, the second Valid Day
after such Conversion Date; and
	 
	 	(ii)	 	if the relevant Conversion Date occurs on
or following the Free Convertibility Date,
the 50 consecutive Valid Days beginning on,
and including, the 52nd Scheduled Valid Day
immediately preceding the Expiration Date.

	 	 	 

	     Settlement Date:

	 	For any Option, the date Shares and/or cash are delivered with respect
to the Convertible Note related to such Option pursuant to Section 14.02(a) of the
Indenture; provided that the Settlement Date will not be prior to the later of (i)
the third Business Day immediately following the final Valid Day of the Settlement
Averaging Period for such Option and (ii) the Exchange Business Day immediately
following the date Counterparty provides written notice to Dealer of such date of
delivery under the Indenture prior to 4:00 PM, New York City time.

8

 

	 	 	 

	     Settlement Currency:

	 	USD
	 
	 	 
	Other Applicable Provisions:

	 	The provisions of Sections 9.1(c), 9.8, 9.9 and 9.11 (as modified below) of the Equity Definitions will be applicable as if
Physical Settlement were applicable.
	 
	 	 
	Representation and Agreement:

	 	Notwithstanding anything to the contrary in Equity
Definitions (including, but not limited to, Section 9.11 thereof), the parties
acknowledge that (i) any Shares delivered to Counterparty shall be, upon delivery,
subject to restrictions and limitations arising from Counterparty’s status as
issuer of the Shares under applicable securities laws, (ii) Dealer may deliver any
Shares required to be delivered hereunder in certificated form in lieu of delivery
through the Clearance System and (iii) any Shares delivered to Counterparty may be
“restricted securities” (as defined in Rule 144 under the Securities Act of 1933,
as amended (the “Securities Act”)).

	3.	 	Additional Terms applicable to the Transaction.
	 
	 	 	Adjustments applicable to the Transaction:

	 	 	 

	     Potential Adjustment Events:

	 	Notwithstanding Section 11.2(e) of the Equity Definitions,
a “Potential Adjustment Event” means an occurrence of any event or condition, as
set forth in any Dilution Adjustment Provision, that would result in an adjustment
to the Conversion Rate (as defined in the Indenture) of the Convertible Notes.
	 
	 	 
	     Method of Adjustment:

	 	Calculation Agent Adjustment, which means that, notwithstanding
Section 11.2(c) of the Equity Definitions, upon any Potential Adjustment Event, the
Calculation Agent shall make a corresponding adjustment to any one or more of the
Strike Price, Number of Options, Option Entitlement and any other variable relevant
to the exercise, settlement or payment for the Transaction; provided that,
notwithstanding the foregoing, if any Potential Adjustment Event occurs during the
Settlement Averaging Period but no adjustment was made to any Convertible Note
under the Indenture because the relevant Holder (as such term is defined in the
Indenture) was deemed to be a record owner of the underlying Shares on the related
Conversion Date, then the Calculation Agent shall make an adjustment, as determined
by it, to the terms hereof in order to account for such Potential Adjustment Event.
	 
	 	 
	Dilution Adjustment Provisions:

	 	Section 14.04(a), (b), (c), (d) and (e) and Section 14.05 of the Indenture.

Extraordinary Events applicable to the Transaction:

	 	 	 

	     Merger Events:

	 	Applicable; provided that notwithstanding Section 12.1(b) of the Equity
Definitions, a “Merger Event” means the occurrence of any event or condition set
forth in the definition of “Merger Event” in Section 14.07(a) of the Indenture.

9

 

	 	 	 

	     Tender Offers:

	 	Applicable; provided that notwithstanding Section 12.1(d) of the Equity
Definitions, a “Tender Offer” means the occurrence of any event or condition set
forth in Section 14.04(e) of the Indenture.
	 
	 	 
	     Consequence of Merger Events / Tender
Offers:

	 	Notwithstanding Section 12.2 and Section 12.3 of the Equity Definitions,
upon the occurrence of a Merger Event or a Tender Offer, 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 (in the case of a Merger
Event), Strike Price, Number of Options, Option 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 pursuant to any Excluded Provision; provided further that if, with
respect to a Merger Event or a Tender Offer, (i) the consideration for the Shares
includes (or, at the option of a holder of Shares, may include) shares of an entity
or person that is not a corporation or is not organized under the laws of the
United States, any State thereof or the District of Columbia or (ii) the
Counterparty to the Transaction following such Merger Event or Tender Offer, will
not be a corporation or will not be the Issuer following such Merger Event or
Tender Offer, then Cancellation and Payment (Calculation Agent Determination) shall
apply.
	 
	 	 
	     Nationalization, Insolvency or Delisting:

	 	Cancellation and Payment (Calculation Agent
Determination); provided that, in addition to the provisions of Section
12.6(a)(iii) of the Equity Definitions, it will also constitute a Delisting if the
Exchange is located in the United States and the Shares are not immediately
re-listed, re-traded or re-quoted on any of the New York Stock Exchange, The NASDAQ
Global Select Market or The NASDAQ Global Market (or their respective successors);
if the Shares are immediately re-listed, re-traded or re-quoted on any of the New
York Stock Exchange, The NASDAQ Global Select Market or The NASDAQ Global Market
(or their respective successors), such exchange or quotation system shall
thereafter be deemed to be the Exchange.
	 
	 	 
	     Additional Disruption Events:
	 	 
	 
	 	 
	          Change in Law:

	 	Applicable; provided that (i) Section 12.9(a)(ii) of the Equity
Definitions is hereby amended by replacing the parenthetical beginning after
the word “regulation” in the second line thereof with the words “(including,
for the avoidance of doubt and without limitation, (x) any tax law or (y)
adoption or promulgation of new regulations authorized or mandated by existing
statute)” and (ii) Section 12.9(a)(ii)(X) of the Equity Definitions is hereby
amended by replacing the word “Shares” with the phrase “Hedge Positions.”
	 
	 	 
	          Failure to Deliver:

	 	Applicable

10

 

	 	 	 

	          Hedging Disruption:

	 	Applicable
	 
	 	 
	          Increased Cost of Hedging:

	 	Applicable
	 
	 	 
	          Hedging Party:

	 	For all applicable Additional Disruption Events, Dealer.
	 
	 	 
	     Determining Party:

	 	For all applicable Extraordinary Events, Dealer.
	 
	 	 
	     Non-Reliance:

	 	Applicable
	 
	 	 
	     Agreements and Acknowledgements 

     Regarding Hedging Activities:

	 	

Applicable
	 
	 	 
	     Additional Acknowledgments:

	 	Applicable
	 
	 	 
	4.           Calculation Agent.

	 	Dealer, whose judgments, determinations and calculations shall be made in good faith
and in a commercially reasonable manner. Following any determination or calculation
by the Calculation Agent hereunder, upon a written request by Counterparty, the
Calculation Agent will provide to Counterparty by e-mail to the e-mail address
provided by Counterparty in such 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, it being understood that the Calculation
Agent shall not be obligated to disclose any proprietary models used by it for such
calculation.
	 
	 	 

	5.	 	Account Details.

	 	(a)	 	Account for payments to Counterparty:
	 
	 	 	 	Bank Name: Wells Fargo Bank

ABA #: 121000248

Beneficiary: First Clearing, LLC

Account #: 4122023377

FFC Account Name: Integra LifeSciences Holdings Corp

FFC Account Number: 8595-0713
	 
	 	 	 	Account for delivery of Shares to Counterparty:

American Stock Transfer & Trust Co LLC

Transfer Agent # 2941

Account # 10249
	 
	 	(b)	 	Account for payments to Dealer:
	 
	 	 	 	To be provided by Dealer.
	 
	 	 	 	Account for delivery of Shares from Dealer:
	 
	 	 	 	To be provided by Dealer.

	6.	 	Offices.

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

11

 

	 	(b)	 	The Office of Dealer for the Transaction is: London

	7.	 	Notices.

	 	(a)	 	Address for notices or communications to Counterparty:
	 
	 	 	 	Integra LifeSciences Holdings Corporation

311 Enterprise Drive

Plainsboro, NJ 08536

Attention:            Treasurer

Telephone No.:    (609) 275-0500

Facsimile No.:      (609) 750-4264

	 	(b)	 	Address for notices or communications to Dealer:

	 	 	 	 	 

	 

	 	To:
	 	Deutsche Bank AG, London Branch
	 

	 	 	 	c/o Deutsche Bank Securities Inc.
	 

	 	Attn:
	 	Faiz Khan / Andrew Yaeger
	 

	 	Group:
	 	Equity-Linked Capital Markets
	 

	 	 	 	60 Wall Street, 4th Floor
	 

	 	 	 	New York, NY 10005
	 

	 	Faiz Tel:
	 	212-250-0668
	 

	 	Faiz Email:
	 	faiz.khan@db.com
	 

	 	Andrew Tel:
	 	212-250-2717
	 

	 	Andrew Email:
	 	Andrew.yaeger@db.com
	 

	 	Facsimile:
	 	732-460-7499

	 

	 	With a copy to:

	 	 
	 

	 	Attn:
	 	Lars Kestner / Dushyant Chadha
	 

	 	Group:
	 	Corporate Derivatives
	 

	 	 	 	60 Wall Street, 4th Floor
	 

	 	 	 	New York, NY 10005
	 

	 	Lars Tel:
	 	212-250-6043
	 

	 	Lars Email:
	 	lars.kestner@db.com
	 

	 	Dushyant Tel:
	 	212-250-4980
	 

	 	Dushyant Email:
	 	dushyant.chadha@db.com

	8.	 	Representations and Warranties of Counterparty.
	 
	 	 	Each of the representations and warranties of Counterparty set forth in Section 3 of the
Purchase Agreement (the “Purchase Agreement”), dated as of June 9, 2011, between
Counterparty and the representatives of the Initial Purchasers party thereto (the
“Representatives”), is true and correct and is hereby deemed to be repeated to Dealer as if
set forth herein; provided that no such representation or warranty, other than the
representations and warranties set forth in Sections 3(a), (b), (d) and (e) of the Purchase
Agreement, may be the basis of an Event of Default under Section 5(a)(iv) of the Agreement.
Counterparty hereby further represents and warrants to Dealer on the date hereof and on and
as of the Premium Payment Date 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 subject, as to enforceability,
to general principles of equity, including principles of commercial reasonableness,
good faith and fair dealing (regardless of whether enforcement is sought in a
proceeding at law or in equity) and

12

 

	 	 	 	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 any of its subsidiaries is a party or by which Counterparty or
any of its subsidiaries is bound or to which Counterparty or 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 or state
securities laws.
	 
	 	(d)	 	Counterparty is not and will not be required to register as an “investment
company” as such term is defined in the Investment Company Act of 1940, as amended.
	 
	 	(e)	 	Counterparty is an “eligible contract participant” (as such term is defined in
Section 1a(12) of the Commodity Exchange Act, as amended, other than a person that is
an eligible contract participant under Section 1a(12)(C) of the Commodity Exchange
Act).
	 
	 	(f)	 	Each of Counterparty and its officers and directors is not, on the date hereof,
in possession of any material non-public information with respect to Counterparty or
the Shares.

	9.	 	Other Provisions.

	 	(a)	 	Opinions. Counterparty shall deliver to Dealer an opinion of counsel,
dated as of the Trade Date, with respect to the matters set forth in Sections 8(a)
through (c) of this Confirmation. Delivery of such opinion to Dealer shall be a
condition precedent for the purpose of Section 2(a)(iii) of the Agreement with respect
to each obligation of Dealer under Section 2(a)(i) of the Agreement.
	 
	 	(b)	 	Repurchase Notices. Counterparty shall, on any day on which
Counterparty effects any repurchase of Shares or consummates or otherwise executes or
engages in any transaction or event (a “Conversion Rate Adjustment Event”) that would
lead to an increase in the Conversion Rate (as such term is defined in the Indenture),
promptly give Dealer a written notice of such repurchase or Conversion Rate Adjustment
Event (a “Repurchase Notice”) on such day if following such repurchase or Conversion
Rate Adjustment Event, the number of outstanding Shares as determined on such day is
(i) less than 26,749,873 (in the case of the first such notice) or (ii) thereafter more
than 1,622,916 less than the number of Shares included in the immediately preceding
Repurchase Notice. Counterparty agrees to indemnify and hold harmless Dealer 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 Dealer’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, that an Indemnified Person may become subject to, as a result of
Counterparty’s failure to provide Dealer 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 Dealer with a Repurchase Notice in accordance with
this paragraph, such Indemnified Person shall promptly notify Counterparty in

13

 

	 	 	 	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 contemplated
by this paragraph that is 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 contemplated by this paragraph that is 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 Counterparty hereunder, 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 (b) are
not exclusive and shall not limit any rights or remedies that 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.
	 
	 	(c)	 	Regulation M. Counterparty is not on the Trade Date engaged in a
distribution, as such term is used in Regulation M under the Exchange Act, of any
securities of Counterparty, other than a distribution meeting the requirements of the
exception set forth in Rules 101(b)(10) and 102(b)(7) of Regulation M. Counterparty
shall not, until the second Scheduled Trading Day immediately following the Effective
Date, engage in any such distribution.
	 
	 	(d)	 	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)
or otherwise in violation of the Exchange Act.
	 
	 	(e)	 	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
Dealer 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(b) or any obligations under Section
9(m) or 9(r) of this Confirmation;
	 
	 	(B)	 	Any Transfer Options shall only be transferred
or assigned to a third party that is a United States 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 Dealer, will not expose Dealer to material risks
under applicable securities laws) and execution of any documentation
and delivery of legal opinions with respect to securities laws and
other matters by such third party and Counterparty, as are requested
and reasonably satisfactory to Dealer;

14

 

	 	(D)	 	Dealer 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 Dealer 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 Dealer to permit Dealer 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 Dealer in connection with such transfer or assignment.

	 	(ii)	 	Dealer may not, without Counterparty’s consent, transfer or
assign all or any part of its rights or obligations under the Transaction
except to any affiliate of Dealer (A) that has a rating for its long term,
unsecured and unsubordinated indebtedness that is equal to or better than
Dealer’s credit rating at the time of such transfer or assignment, or (B) whose
obligations hereunder will be guaranteed, pursuant to the terms of a customary
guarantee in a form used by Dealer generally for similar transactions, by
Dealer or the Dealer Parent. If at any time at which (A) the Section 16
Percentage exceeds 7.5%, (B) the Option Equity Percentage exceeds 14.5%, or (C)
the Share Amount exceeds the Applicable Share Limit (if any applies) (any such
condition described in clauses (A), (B) or (C), an “Excess Ownership
Position”), Dealer is unable after using its commercially reasonable efforts to
effect a transfer or assignment of Options to a third party on pricing terms
reasonably acceptable to Dealer and within a time period reasonably acceptable
to Dealer such that no Excess Ownership Position exists, then Dealer may
designate any Exchange Business Day as an Early Termination Date with respect
to a portion of the Transaction (the “Terminated Portion”), such that following
such partial termination no Excess Ownership Position exists. In the event
that Dealer 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 number of Options underlying the Terminated Portion, (2)
Counterparty were the sole Affected Party with respect to such partial
termination and (3) the Terminated Portion were the sole Affected Transaction
(and, for the avoidance of doubt, the provisions of Section 9(k) shall apply to
any amount that is payable by Dealer to Counterparty pursuant to this sentence
as if Counterparty was not the Affected Party). The “Section 16 Percentage” as
of any day is the fraction, expressed as a percentage, (A) the numerator of
which is the number of Shares that Dealer and each person subject to
aggregation of Shares with Dealer under Section 13 or Section 16 of the
Exchange Act and rules promulgated thereunder directly or indirectly
beneficially own (as defined under Section 13 or Section 16 of the Exchange Act
and rules promulgated thereunder) and (B) the denominator of which is the
number of Shares outstanding. The “Option Equity Percentage” as of any day is
the fraction, expressed as a percentage, (A) the numerator of which is the sum
of (1) the product of the Number of Options and the Option Entitlement and (2)
the aggregate number of Shares underlying any other call option transaction
sold by Dealer to Counterparty, and (B) the denominator of which is the number
of Shares outstanding. The “Share Amount” as of any day is the number of
Shares that Dealer and any person whose ownership position would be aggregated
with that of Dealer (Dealer or any such person, a “Dealer Person”) under any
law, rule, regulation, regulatory order or organizational documents or
contracts of Counterparty that are, in each case, applicable to ownership of
Shares (“Applicable Restrictions”), owns, beneficially owns, constructively
owns, controls, holds the power to vote or otherwise

15

 

	 	 	 	meets a relevant definition of ownership under any Applicable Restriction,
as determined by Dealer in its reasonable discretion. The “Applicable Share
Limit” means a number of Shares equal to (A) the minimum number of Shares
that could give rise to reporting or registration obligations (except for
any filings of Schedule 13D or Schedule 13G under the Exchange Act or any
other filing obligations applicable as of the date hereof) or other
requirements (including obtaining prior approval from any person or entity)
of a Dealer Person, or could result in an adverse effect on a Dealer Person,
under any Applicable Restriction, as determined by Dealer in its reasonable
discretion, minus (B) 1% of the number of Shares outstanding.
	 
	 	(iii)	 	Notwithstanding any other provision in this Confirmation to
the contrary requiring or allowing Dealer to purchase, sell, receive or deliver
any Shares or other securities, or make or receive any payment in cash, to or
from Counterparty, Dealer may designate any of its affiliates to purchase,
sell, receive or deliver such Shares or other securities, or to make or receive
such payment in cash, and otherwise to perform Dealer’s obligations in respect
of the Transaction and any such designee may assume such obligations. Dealer
shall be discharged of its obligations to Counterparty to the extent of any
such performance.

	 	(f)	 	Staggered Settlement. If upon advice of counsel with respect to
applicable legal and regulatory requirements, including any requirements relating to
Dealer’s hedging activities hereunder, Dealer reasonably determines that it would not
be advisable to deliver, or to acquire Shares to deliver, any or all of the Shares to
be delivered by Dealer on the Settlement Date for the Transaction, Dealer 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:

	 	(i)	 	in such notice, Dealer will specify to Counterparty the related
Staggered Settlement Dates (each of which will be on or prior to such Nominal
Settlement Date) and the number of Shares that it will deliver on each
Staggered Settlement Date;
	 
	 	(ii)	 	the aggregate number of Shares that Dealer will deliver to
Counterparty hereunder on all such Staggered Settlement Dates will equal the
number of Shares that Dealer would otherwise be required to deliver on such
Nominal Settlement Date; and
	 
	 	(iii)	 	if the Net Share Settlement terms set forth above were to
apply on the Nominal Settlement Date, then the Net Share Settlement terms will
apply on each Staggered Settlement Date, except that the Net Shares will be
allocated among such Staggered Settlement Dates as specified by Dealer in the
notice referred to in clause (i) above.

	 	(g)	 	Role of Agent. Whenever delivery of funds or other assets is required
hereunder by or to Counterparty, such delivery shall be effected through DBSI. In
addition, all notices, demands and communications of any kind relating to the
Transaction between Dealer and Counterparty shall be transmitted exclusively through
DBSI.
	 
	 	(h)	 	Additional Termination Events.

	 	(i)	 	Notwithstanding anything to the contrary in this Confirmation
if (i) an event of default with respect to Counterparty occurs under the terms
of the Convertible Notes as set forth in Section 6.01 of the Indenture or (ii)
Counterparty gives Dealer the notice required pursuant to the last sentence of
this paragraph, then such occurrence or the giving of such notice, as
applicable, shall constitute an Additional Termination Event applicable to the
Transaction and, with respect to such Additional Termination Event, (A)
Counterparty shall be deemed to be the sole Affected Party, (B) the Transaction
shall be the sole Affected Transaction and (C) Dealer shall be the party
entitled to designate an Early Termination Date pursuant to Section 6(b) of the
Agreement (which Early Termination Date shall correspond in the case of a
Repurchase Event (as defined below), if applicable, to a payment date under
Section 6(d)(ii) of the Agreement occurring within a

16

 

	 	 	 	commercially reasonable period of time (as determined by Dealer in a
commercially reasonable manner in consultation with counsel with regard to
legal, regulatory or commercial issues arising in connection with any
related hedging or hedge unwind activities) after the date of payment with
respect to the Convertible Notes, if applicable, for such Repurchase Event)
and determine the amount payable pursuant to Section 6(e) of the Agreement;
provided that in the case of a Repurchase Event, the Transaction shall be
subject to termination only in respect of a number of Options (the “Affected
Number of Options”), equal to the lesser of (A) the number of Convertible
Notes that cease to be outstanding in connection with or as a result of such
Repurchase Event, as the case may be, minus the “Affected Number of Options”
(as defined in the Base Call Option Transaction Confirmation), if any, that
relate to such Repurchase Event, as the case may be (and, for the purposes
of determining whether any Options under this Confirmation or under the Base
Call Option Transaction Confirmation will be among the Affected Number of
Options hereunder or among the “Affected Number of Options” under, and as
defined in, the Base Call Option Transaction Confirmation, the Affected
Number of Options shall be allocated first to the Base Call Option
Transaction Confirmation until all Options thereunder are exercised or
terminated), and (B) the number of Options then outstanding. For the
avoidance of doubt, in determining the amount payable in respect of such
Affected Transaction pursuant to Section 6 of the Agreement in connection
with a Repurchase Event, the Calculation Agent shall assume that the
Convertible Notes subject to such Repurchase Event shall not have been
repurchased and remain outstanding. Counterparty shall notify Dealer
promptly following the occurrence of any Repurchase Event; provided that
Counterparty agrees to initiate a Repurchase Event only if Counterparty
represents to Dealer at the time it takes action to so initiate such
Repurchase Event that it is not in possession of any material nonpublic
information with respect to Counterparty or the Shares.
	 
	 	 	 	“Repurchase Event” means that (i) any Convertible Notes are repurchased
(whether in connection with or as a result of a fundamental change,
howsoever defined, a tender offer or similar transaction or for any other
reason) by Counterparty, (ii) any Convertible Notes are delivered to
Counterparty in exchange for delivery of any property or assets of
Counterparty (howsoever described), (iii) any principal of any of the
Convertible Notes is repaid prior to the final maturity date of the
Convertible Notes (whether following acceleration of the Convertible Notes
or otherwise), or (iv) any Convertible Notes are exchanged by or for the
benefit of the holders thereof for any other securities of Counterparty (or
any other property, or any combination thereof) pursuant to any exchange
offer or similar transaction. For the avoidance of doubt, any conversion of
Convertible Notes pursuant to the terms of the Indenture shall not
constitute a Repurchase Event.
	 
	 	(ii)	 	Notwithstanding anything to the contrary in this Confirmation,
the receipt by Dealer from Counterparty, within the applicable time period set
forth under “Notice of Exercise” above, of any Notice of Exercise in respect of
Options that relate to Convertible Notes as to which additional Shares would be
added to the Conversion Rate pursuant to Section 14.03 of the Indenture in
connection with a “Make-Whole Fundamental Change” (as defined in the Indenture)
shall constitute an Additional Termination Event as provided in this Section
9(h)(ii). Upon receipt of any such Notice of Exercise, Dealer shall designate
an Exchange Business Day following such Additional Termination Event (which
Exchange Business Day shall in no event be earlier than the related settlement
date for such Convertible Notes) as an Early Termination Date with respect to
the portion of this Transaction corresponding to a number of Options (the
“Make-Whole Conversion Options”) equal to the lesser of (A) the number of such
Options specified in such Notice of Exercise minus the number of “Make-Whole
Conversion Options” (as defined in the Base Call Option Confirmation), if any,
that relate to such Convertible Notes and (B) the Number of Options as of the
date Dealer designates such Early Termination Date and, as of such date, the
Number of Options shall be reduced by the number of Make-Whole Conversion
Options. Any payment hereunder with respect to such termination shall be

17

 

	 	 	 	calculated pursuant to Section 6 of the Agreement as if (1) an Early
Termination Date had been designated in respect of a Transaction having
terms identical to this Transaction and a Number of Options equal to the
number of Make-Whole Conversion Options, (2) Counterparty were the sole
Affected Party with respect to such Additional Termination Event and (3) the
terminated portion of the Transaction were the sole Affected Transaction
(and, for the avoidance of doubt, in determining the amount payable pursuant
to Section 6 of the Agreement, the Calculation Agent shall not take into
account any adjustments to the Option Entitlement that result from
corresponding adjustments to the Conversion Rate pursuant to Section 14.03
of the Indenture); provided that the amount of cash deliverable in respect
of such early termination by Dealer to Counterparty shall not be greater
than the product of (x) the Applicable Percentage and (y) the excess of (I)
(1) the number of Make-Whole Conversion Options multiplied by (2) the
Conversion Rate (after taking into account any applicable adjustments to the
Conversion Rate pursuant to Section 14.03 of the Indenture) multiplied by
(3) a price per Share determined by the Calculation Agent over (II) the
aggregate principal amount of such Convertible Notes, as determined by the
Calculation Agent in a commercially reasonable manner.

	 	(i)	 	Amendments to Equity Definitions.

	 	(i)	 	Section 12.6(a)(ii) of the Equity Definitions is hereby amended
by (1) deleting from the fourth line thereof the word “or” after the word
“official” and inserting a comma therefor, and (2) deleting the semi-colon at
the end of subsection (B) thereof and inserting the following words therefor
“or (C) at Dealer’s option, the occurrence of any of the events specified in
Section 5(a)(vii)(1) through (9) of the ISDA Master Agreement with respect to
that Issuer.”
	 
	 	(ii)	 	Section 12.9(b)(i) of the Equity Definitions is hereby amended
by (1) replacing “either party may elect” with “Dealer may elect” and (2)
replacing “notice to the other party” with “notice to Counterparty” in the
first sentence of such section.

	 	(j)	 	No Set-off. Each party waives any and all rights it may have to set
off obligations arising under the Agreement and the Transaction against other
obligations between the parties, whether arising under any other agreement, applicable
law or otherwise.
	 
	 	(k)	 	Alternative Calculations and Payment on Early Termination and on Certain
Extraordinary Events. If in respect of the Transaction, an amount is payable by
Dealer to Counterparty (i) pursuant to Section 12.7 or Section 12.9 of the Equity
Definitions or (ii) pursuant to Section 6(d)(ii) of the Agreement (any such amount, a
“Payment Obligation”), Counterparty may request Dealer to satisfy the Payment
Obligation by the Share Termination Alternative (as defined below) (except that
Counterparty shall not have the right to make such an election in the event of (I) a
Nationalization, Insolvency, Merger Event or Tender Offer, in each case, in which the
consideration to be paid to holders of Shares consists solely of cash, (II) a Merger
Event or Tender Offer that is within Counterparty’s control, or (III) 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 Dealer, confirmed in writing within one Scheduled
Trading Day, no later than 12:00 p.m. (New York City time) on the Merger Date, the
Tender Offer Date, the Announcement Date (in the case of Nationalization, Insolvency or
Delisting), the Early Termination Date or date of cancellation, as applicable; provided
that if Counterparty does not validly request Dealer to satisfy the Payment Obligation
by the Share Termination Alternative, Dealer 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:

	 	If applicable, Dealer shall deliver
to Counterparty the Share Termination Delivery Property on, or within a
commercially reasonable period of time after, the

18

 

	 	 	 

	 

	 	date when the relevant Payment Obligation
would otherwise be due pursuant to Section
12.7 or 12.9 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 such 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 Dealer of property
contained in one Share Termination Delivery Unit, as determined by the
Calculation Agent in its discretion by commercially reasonable means and
notified by the Calculation Agent to Dealer at the time of notification of the
Payment Obligation. 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 9.8, 9.9 and 9.11 (as modified above) of
the Equity Definitions and the provisions set forth opposite the caption
“Representation and Agreement” in Section 2 will be applicable as if Physical
Settlement were applicable.

	 	(l)	 	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.
	 
	 	(m)	 	Registration. Counterparty hereby agrees that if, in the good faith
reasonable judgment of Dealer based on the advice of counsel, the Shares (“Hedge
Shares”) acquired by Dealer for the purpose

19

 

	 	 	 	of hedging its obligations pursuant to the Transaction cannot be sold in the public
market by Dealer without registration under the Securities Act, Counterparty shall,
at its election, either (i) in order to allow Dealer to sell the Hedge Shares in a
registered offering, make available to Dealer an effective registration statement
under the Securities Act and enter into an agreement, in form and substance
satisfactory to Dealer, substantially in the form of an underwriting agreement for a
registered secondary offering of substantially similar size; provided, however, that
if Dealer, in its sole reasonable discretion, is not satisfied with access to due
diligence materials, the results of its due diligence investigation, or the
procedures and documentation for the registered offering referred to above, then
clause (ii) or clause (iii) of this paragraph shall apply at the election of
Counterparty, (ii) in order to allow Dealer to sell the Hedge Shares in a private
placement, enter into a private placement agreement substantially similar to private
placement purchase agreements customary for private placements of equity securities
of substantially similar size, in form and substance satisfactory to Dealer (in
which case, the Calculation Agent shall make any adjustments to the terms of the
Transaction that are necessary, in its reasonable judgment, to compensate Dealer for
any discount from the public market price of the Shares incurred on the sale of
Hedge Shares in a private placement), or (iii) purchase the Hedge Shares from Dealer
at the Relevant Price on such Exchange Business Days, and in the amounts, requested
by Dealer.
	 
	 	(n)	 	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.
	 
	 	(o)	 	Right to Extend. Dealer may postpone or add, in whole or in part, any
Valid Day or Valid Days during the Settlement Averaging Period or any other date of
valuation, payment or delivery by Dealer, with respect to some or all of the Options
hereunder, if Dealer reasonably determines based on the advice of counsel, in its
discretion, that such action is reasonably necessary or advisable to preserve Dealer’s
hedging or hedge unwind activity hereunder in light of existing liquidity conditions or
to enable Dealer to effect purchases of Shares in connection with its hedging, hedge
unwind or settlement activity hereunder in a manner that would, if Dealer were
Counterparty or an affiliated purchaser of Counterparty, be in compliance with
applicable legal, regulatory or self-regulatory requirements, or with related policies
and procedures applicable to Dealer.
	 
	 	(p)	 	Status of Claims in Bankruptcy. Dealer acknowledges and agrees that
this Confirmation is not intended to convey to Dealer rights against Counterparty with
respect to the Transaction that are senior to the claims of common stockholders of
Counterparty in any United States bankruptcy proceedings of Counterparty; provided that
nothing herein shall limit or shall be deemed to limit Dealer’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 Dealer’s rights in respect of any transactions other than the
Transaction.
	 
	 	(q)	 	Securities Contract; Swap Agreement. The parties hereto intend for (i)
the Transaction to be a “securities contract” and a “swap agreement” 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)(17), 546(e), 546(g), 555 and 560 of the Bankruptcy Code,
(ii) a party’s right to liquidate the Transaction and to exercise any other remedies
upon the occurrence of any Event of Default under the Agreement with respect to the
other party to constitute a “contractual right” as described in the Bankruptcy Code,
and (iii) 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.
	 
	 	(r)	 	Notice of Certain Other Events. Counterparty covenants and agrees that:

	 
	 	(i)	 	promptly following the public announcement of the results of
any election by the holders of Shares with respect to the consideration due
upon consummation of any consolidation, merger and binding share exchange to
which Counterparty is a party, or any sale of all or

20

 

	 	 	 	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 give Dealer written notice 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; and
	 
	 	(ii)	 	promptly following any adjustment to the Convertible Notes in
connection with any Potential Adjustment Event, Merger Event or Tender Offer,
Counterparty shall give Dealer written notice of the details of such
adjustment.

	 	(s)	 	Wall Street Transparency and Accountability Act. In connection with
Section 739 of the Wall Street Transparency and Accountability Act of 2010 (“WSTAA”),
the parties hereby agree that neither the enactment of WSTAA or any regulation under
the WSTAA, nor any requirement under WSTAA or an amendment made by WSTAA, shall limit
or otherwise impair either party’s otherwise applicable rights to terminate,
renegotiate, modify, amend or supplement this Confirmation or the Agreement, as
applicable, arising from a termination event, force majeure, illegality, increased
costs, regulatory change or similar event under this Confirmation, the Equity
Definitions incorporated herein, or the Agreement (including, but not limited to,
rights arising from Change in Law, Hedging Disruption, Increased Cost of Hedging, an
Excess Ownership Position, or Illegality (as defined in the Agreement)).
	 
	 	(t)	 	Early Unwind. In the event the sale of the “Option Securities” (as
defined in the Purchase Agreement) is not consummated with the Representatives for any
reason, or Counterparty fails to deliver to Dealer opinions of counsel as required
pursuant to Section 9(a), in each case by 5:00 p.m. (New York City time) on the Premium
Payment Date, or such later date as agreed upon by the parties (the Premium Payment
Date 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 Dealer 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 in cases involving a breach of the
Purchase Agreement by Dealer, Counterparty shall purchase from Dealer on the Early
Unwind Date all Shares purchased by Dealer or one or more of its affiliates in
connection with the Transaction at the then prevailing market price. Each of Dealer
and Counterparty represents and acknowledges to the other that, subject to the proviso
included in this Section 9(r), upon an Early Unwind, all obligations with respect to
the Transaction shall be deemed fully and finally discharged.
	 
	 	(u)	 	Payment by Counterparty. In the event that (i) an Early Termination
Date occurs or is designated with respect to the Transaction as a result of a
Termination Event or an Event of Default (other than an Event of Default arising under
Section 5(a)(ii) or 5(a)(iv) of the Agreement) and, as a result, Counterparty owes to
Dealer an amount calculated under Section 6(e) of the Agreement, or (ii) Counterparty
owes to Dealer, pursuant to Section 12.7 or Section 12.9 of the Equity Definitions, an
amount calculated under Section 12.8 of the Equity Definitions, such amount shall be
deemed to be zero.

[Remainder of Page Intentionally Blank]

21

 

     Please confirm that the foregoing correctly sets forth the terms of our agreement by executing
this Confirmation and returning it to Deutsche Bank Securities Inc., 60 Wall Street, New York, NY
10005, or by fax to (212) 797 8974.

Very truly yours,

	 	 	 	 	 	 	 

	 	 	Deutsche Bank AG, London Branch	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Lars Kestner	 	 
	 

	 	 	 	 

	 	 
	 	 	Authorized Signatory	 	 
	 

	 	Name:	 	Lars Kestner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Natalie Heaton	 	 
	 

	 	 	 	 

	 	 
	 	 	Authorized Signatory	 	 
	 

	 	Name:	 	Natalie Heaton	 	 
	 
	 	 	 	 	 	 
	 	 	Deutsche Bank Securities Inc., acting solely as
Agent in connection with the Transaction	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Lars Kestner	 	 
	 

	 	 	 	 

	 	 
	 	 	Authorized Signatory	 	 
	 

	 	Name:	 	Lars Kestner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Natalie Heaton	 	 
	 

	 	 	 	 

	 	 
	 	 	Authorized Signatory	 	 
	 

	 	Name:	 	Natalie Heaton	 	 

	 	 	 	 	 

	Accepted and confirmed

as of the Trade Date:	 	 
	 
	 	 	 	 
	Integra LifeSciences Holdings Corporation	 	 
	 
	 	 	 	 
	By:
	 	/s/ Nora Brennan	 	 
	 

	 	 

	 	 
	Authorized Signatory	 	 
	Name:
	 	Nora Brennan	 	 

[DB Additional Bond Hedge Confirmation]

	 	 	 

	Chairman of the Supervisory Board: Clemens Börsig
Management Board: Josef Ackermann (Chairman), Hugo
Bänziger, Jürgen Fitschen, Anshuman Jain, Stefan
Krause, Hermann-Josef Lamberti, Rainer Neske

	 	Deutsche Bank AG is
authorized under German
Banking Law (competent
authority: BaFin – Federal
Financial Supervising
Authority) and regulated by
the Financial Services
Authority for the conduct of
UK business; a member of the
London Stock Exchange.
Deutsche Bank AG is a joint
stock corporation with
limited liability
incorporated in the Federal
Republic of Germany HRB No.
30 000 District Court of
Frankfurt am Main; Branch
Registration in England and
Wales BR000005; Registered
address: Winchester House, 1
Great Winchester Street,
London EC2N 2DB. Deutsche
Bank Group online: http://www.deutsche-bank.com

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