Exhibit 10.1
EXECUTION COPY
GOLDMAN SACHS & CO. | 85 BROAD STREET | NEW YORK, NEW
YORK 10004 | TEL: 212-902-1000
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To:
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PG&E Corporation
One Market Spear Tower
Suite 2400
San Francisco, CA 94105
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From:
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Goldman, Sachs & Co.
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Subject:
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Accelerated Share Repurchase Transaction - VWAP Pricing
(Non-Collared)
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Ref. No:
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EN50BJ000000000
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Date:
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March 4, 2005
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This
master confirmation (“Master Confirmation”) dated as of
March 4, 2005, is intended to supplement the terms and provisions
of certain Transactions (each, a “Transaction”) entered
into from time to time between Goldman, Sachs & Co.
(“GS&Co.”) and PG&E Corporation
(“Counterparty”). This Master Confirmation, taken
alone, is neither a commitment by either party to enter into any
Transaction nor evidence of a Transaction. The terms of any
particular Transaction shall be set forth in a Supplemental
Confirmation in the form of Annex A, which references this Master
Confirmation, in which event the terms and provisions of this
Master Confirmation shall be deemed to be incorporated into and
made a part of each such Supplemental Confirmation. This
Master Confirmation and each Supplemental Confirmation together
shall constitute a “Confirmation” as referred to in the
Agreement specified below.
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., are incorporated into this Master Confirmation. This
Master Confirmation and each Supplemental Confirmation evidences a
complete binding agreement between the Counterparty and GS&Co.
as to the terms of each Transaction to which this Master
Confirmation and the related Supplemental Confirmation relates.
This
Master Confirmation and each Supplemental
Confirmation, together with all other documents referring to the
1992 ISDA Master Agreement
(Multicurrency-Cross Border) (the “ISDA Form” or the
“Agreement), confirming Transactions
entered into between GS&Co. and Counterparty, shall supplement,
form a part of, and be subject to the ISDA Form as if GS&Co.
and Counterparty had executed the Agreement (but without any
Schedule) except that
the following elections and modifications shall be made: (i) the election of Loss and Second Method, New
York law (without regard to conflicts of law principles) as the
governing law and US Dollars (“USD”) as the Termination
Currency, (ii) the election that subparagraph (ii) of
Section 2(c) will not apply to Transactions, (iii) the
replacement of the word “third” in the last line of
Section 5(a)(i) with the word “first”, (iv) the
election that the “Cross Default” provisions of Section
5(a)(vi) shall apply to Counterparty, with a “Threshold
Amount” of USD
75 million, and (v) the replacement of clause (1) in Section
6(d)(i) with the clause “(1) showing in reasonable detail
such calculations and specifying any amount payable under Section
6(e) (including, without limitation, providing all relevant
quotations and assumptions and specifying the methodologies used in
sufficient detail so as to enable the other party to replicate the
calculation)”. Further, for purposes of determining
whether an Event of Default pursuant to Section 5(a)(vi) of the
Agreement has occurred, notwithstanding
anything to the contrary stated in that
provision, clause (1) of Section 5(a)(vi) will apply only to
Specified Indebtedness that is actually declared to be due and
payable before it would otherwise be due and payable under the
relevant agreement or instrument, and not to Specified Indebtedness
that is merely “capable at such time of being declared”
so due and payable.
All
provisions contained in the Agreement shall govern this Master
Confirmation and the related Supplemental Confirmation relating to
a Transaction except as expressly modified
herein or in the related Supplemental
Confirmation. With respect to any relevant Transaction, the
Agreement, this Master Confirmation and the related Supplemental
Confirmation shall represent the entire agreement and understanding
of the parties with respect to the subject matter and terms of such
Transaction and shall supersede all prior or contemporaneous
written or oral communications with respect thereto.
If,
in relation to any Transaction to which this Master Confirmation
and related Supplemental Confirmation relate, there is any
inconsistency between the Agreement, this Master Confirmation, any
Supplemental Confirmation and the Equity Definitions that are
incorporated into this Master Confirmation
or any Supplemental Confirmation, the
following will prevail for purposes of such Transaction in the
order of precedence indicated: (i) such Supplemental Confirmation;
(ii) this Master Confirmation; (iii) the Agreement; and (iv) the
Equity Definitions.
1. Each
Transaction constitutes a Share Forward Transaction for the
purposes of the Equity Definitions. Set forth below are the
terms and conditions which, together with the terms and conditions
set forth in each Supplemental Confirmation (in respect of each
relevant Transaction), shall govern each such Transaction.
General Terms:
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Trade Date:
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For each Transaction, as set forth in the Supplemental
Confirmation.
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Seller:
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Counterparty
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Buyer:
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GS&Co.
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Shares:
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Common Stock of PG&E Corp. (Ticker:
PCG)
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Number of Shares:
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For each Transaction, as set forth in the Supplemental
Confirmation.
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Forward Price:
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For each Transaction, as set forth in the Supplemental
Confirmation.
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Prepayment:
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Not
Applicable
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Variable Obligation:
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Not
Applicable
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Exchange:
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New York Stock
Exchange
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Related Exchange(s):
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All
Exchanges
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Market Disruption Event:
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The definition of “Market Disruption Event” in
Section 6.3(a) of the Equity Definitions is hereby amended by
inserting the words “at any time on any Scheduled Trading Day
during the Valuation Period or” after the word
“material,” in the third line thereof.
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Valuation:
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Valuation Period:
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Each Scheduled Trading Day during the period commencing on and
including the Valuation Period Start Date to and including the
Valuation Date (but excluding any day(s) on which the Valuation
Period is suspended in accordance with Section 5 herein and
including any day(s) by which the Valuation Period is extended
pursuant to the provision
below).
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Notwithstanding anything to the contrary in the Equity
Definitions, to the extent that any Scheduled Trading Day in the
Valuation Period is a Disrupted Day, the Valuation Date shall be
postponed and the Calculation Agent in its sole discretion shall
extend the Valuation Period and make adjustments to the weighting
of each Relevant Price for purposes of determining the Settlement
Price, with such adjustments based on, among other factors, the
duration of any Market Disruption Event and the volume, historical
trading patterns and price of the Shares. To the extent that
there are 9 consecutive Disrupted Days during the Valuation Period,
then notwithstanding the occurrence of a Disrupted Day, the
Calculation Agent shall have the option in its sole discretion to
either determine the Relevant Price using its good faith estimate
of the value for the Share on such 9 th consecutive day
or elect to further extend the Valuation Period as it deems
necessary.
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Valuation Period Start Date:
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For each Transaction, as set forth in the Supplemental
Confirmation.
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Valuation Date:
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For each Transaction, as set forth in the Supplemental
Confirmation (as the same may be postponed in accordance with the
provisions of “Valuation Period” and Section 5
herein).
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Settlement Terms:
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Settlement Currency:
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USD (all amounts shall be converted to the Settlement Currency
in good faith and in a commercially reasonable manner by the
Calculation
Agent).
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Settlement Method Election:
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Applicable; provided that (a) Section 7.1 of the Equity
Definitions is hereby amended by deleting the word
“Physical” in the sixth line thereof and replacing it
with the words “Net Share” and deleting the word
“Physical” in the last line thereof and replacing it
with word “Cash” and (b) in the event that GS&Co.
would deliver to the Counterparty an amount of Shares under Net
Share Settlement, Cash Settlement shall be applicable in lieu of
Net Share
Settlement.
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Electing Party:
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Counterparty
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Settlement Method Election Date:
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10 Scheduled Trading Days prior to the originally scheduled
Valuation Date.
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Defau lt Settlement Method:
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Cash
Settlement
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Forward Cash Settlement Amount:
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An amount in the Settlement Currency equal to the product of
(a) the Number of Shares multiplied by (b) an amount equal to
(i) the Settlement Price minus (ii) the Forward
Price.
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Settlement Price:
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The arithmetic mean of the Relevant Prices of the Shares for
each Exchange Business Day in the Valuation
Period.
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Relevant Price:
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The New York 10b-18 Volume Weighted Average Price per share of
the Shares for the regular trading session (including any
extensions thereof) of the Exchange on the related Exchange
Business Day (without regard to pre-open or after hours trading
outside of such regular trading session) as published by Bloomberg
at 4:15 p.m. New York time on such date.
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Cash Settlement Payment Date:
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3 Currency Business Days after the Valuation
Date.
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Counterparty’s Contact Details for Purpose of Giving
Notice:
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Nicholas Bijur
Assistant Treasurer
PG&E Corporation
One Market Street, Spear Tower
Suite 2400
San Francisco, CA 94105
Telephone No.: (415) 817-8199
Facsimile No.: (415) 267-7265
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With a copy to:
Gary Encinas
Chief Counsel-Corporate
PG&E Corporation
One Market Street, Spear Tower
Suite 2400
San Francisco, CA 94105
Telephone No.: (415) 817-8201
Facsimile No.: (415) 817-8225
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GS&Co.’s Contact Details for Purpose of Giving Notice:
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Telephone No.: (212) 902-8996
Facsimile No.: (212) 902-0112
Attention: Equity Operations: Options and
Derivatives
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With a copy to:
Kelly Coffey
Equity Capital Markets
One New York Plaza
New York, NY 10004
Telephone No.:
(212) 902-1037
Facsimile No.:
(212) 346-2126
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Net Share Settlement:
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Net Share Settlement Procedures:
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Net Share Settlement shall be made in accordance with the
procedures attached hereto as Annex
B.
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Net Share Settlement Price:
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The Net Share
Settlement Price shall be the price per Share as of the Valuation
Time on the Net Share Valuation Date as reported in the official
real-time price dissemination mechanism for
the Exchange. The Net Share Settlement
Price shall be reduced by the per Share amount of the underwriting
discount and/or commissions agreed to pursuant to the equity
underwriting or agency agreement contemplated by the Net Share Settlement
Procedures.
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Valuation Time:
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As provided in Section 6.1 of the Equity Definitions; provided
that Section 6.1 of the Equity Definitions is hereby amended by
inserting the words “Net Share,”
before the words “Valuation Date” in the first and
third lines
thereof.
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Net Share Valuation Date:
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The Exchange Business Day immediately following the Valuation
Date.
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Net Share Settlement Date:
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The third Exchange Business Day immediately following the
Valuation Date.
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Reserved Shares:
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For each Transaction, as set forth in the Supplemental
Confirmation.
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Fixed, Floating and Counterparty
Additional Payment Amounts Payable:
Floating Amount Payable by GS&Co.:
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Floating Amount Payment Date:
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The Cash Settlement Payment
Date
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Floating Amount:
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For each Transaction, an amount equal to the sum of the
applicable Federal Funds Rate multiplied by (i) the Daily Notional
Amount multiplied by (ii) 1/360 for each day from and including the
Floating Amount Accrual Date to and including the Valuation
Date.
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Floating Amount Accrual Date:
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Trade Date
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Federal Funds Rate:
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For any date of determination, the “Fed Funds Open
Rate,” which shall be the interest rate reported on Bloomberg
under the symbol “FEDSOPEN <index>” on such
date. For the avoidance of doubt, for any day which is not a
Currency Business Day the “Federal Funds Open Rate” for
the immediately preceding Currency Business Day shall
apply.
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Daily Notional Amount:
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Commencing with the Floating Amount Accrual Date, for any date
of determination, the Daily Notional Amount shall be an amount
equal to the product of the Initial Notional Amount (as set forth
in the Supplemental Confirmation) multiplied by a fraction with a
numerator equal to the Originally Scheduled Number of Scheduled
Trading Days in the Valuation Period minus the number of Exchange
Business Days in the Valuation Period that have elapsed (other than
any days during which the Valuation Period is suspended pursuant to
Section 5 herein) as of such date of determination and a
denominator equal to the Originally Scheduled Number of Scheduled
Trading Days in the Valuation Period (such fraction, the
“Remaining
Percentage”).
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To the extent that the Valuation Period is extended pursuant to
the terms of this Master Confirmation, the Calculation Agent shall
adjust the Daily Notional Amount commencing with the first Exchange
Business Day after such extension (the “Valuation Period
Extension Date”). The notional amount deemed to be
remaining at the end of the Exchange Business Day before the
Valuation Period Extension Date (the “Remaining Notional
Value”) shall be the Initial Notional Value multiplied by the
Remaining Percentage at the end of such day. Commencing with
the Valuation Period Extension Date, for any date of determination,
the Daily Notional Amount shall be equal to the product of the
Remaining Notional Value multiplied by a fraction with (a) a
numerator equal to (i) the number of Scheduled Trading Days
remaining from and including the Valuation Period Extension Date to
the Valuation Date after extension (the “Remaining Scheduled
Trading Days”) minus (ii) the number of Exchange Business
Days in the Valuation Period after extension from and including the
Valuation Period Extension Date that have elapsed (other than any
days during which the Valuation Period after extension is suspended
pursuant to Section 5 herein) as of such date of determination and
(b) a denominator equal to the Remaining Scheduled Trading
Days.
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Fixed Amount Payable by Counterparty:
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Fixed Amount Payment Date:
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The Cash Settlement Payment
Date
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Fixed Amount:
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For each Transaction, an amount equal to the sum of (I) the applicable Daily
Additional Spread multiplied by (i) the
Daily Notional Amount multiplied by (ii) 1/360 for each day from and including the Floating Amount
Accrual Date to and including the Valuation Date plus (II) an amount equal
to the sum of the applicable Fixed Rate
multiplied by (i) the Notional Amount multiplied by (ii)
1/360 for each day
from and including the Floating Amount Accrual Date to and
including the Valuation
Date.
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Fixed Rate:
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For each Transaction, as set forth in the Supplemental
Confirmation.
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Daily Additional Spread:
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The Additional Spread shall be 25 basis
points
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Notional Amount:
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For any date of determination, 105% of the Daily Notional
Amount.
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Counterparty Additional Amount
Payable by Company:
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Counterparty Additional Payment Amount:
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For each Transaction, as set forth in the Supplemental
Confirmation.
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Counterparty Additional Payment Date:
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The Cash Settlement Payment
Date.
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Settlement Terms for Fixed Amount and
Counterparty Additional Payment Amount:
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Settlement Currency
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USD (all amounts shall be converted to the Settlement Currency
in good faith and in a commercially reasonable manner by the
Calculation
Agent).
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Settlement Method Election:
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Applicable; provided that Section 7.1 of the Equity
Definitions is hereby amended by deleting the word
“Physical” in the sixth line thereof and replacing it
with the words “Net Share” and deleting the word
“Physical” in the last line thereof and replacing it
with the word
“Cash”.
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Electing Party:
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Counterparty
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Settlement Method Election Date:
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10 Scheduled Trading Days prior to the originally scheduled
Valuation Date.
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Default Settlement Method:
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Cash
Settlement
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Share Adjustments:
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Method of Adjustment:
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Calculation Agent
Adjustment
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Extraordinary Events:
Consequences of Merger
Events: Subject
to Section 7(b) of the Master Confirmation:
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(a) Share-for-Share:
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Modified Calculation Agent Adjustment
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(b) Share-for-Other:
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Cancellation and Payment on that portion of the Other
Consideration that consists of cash; Modified Calculation Agent
Adjustment on the remainder of the Other Consideration.
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(c) Share-for-Combined:
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Component
Adjustment
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Determining Party:
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GS&Co.
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Tender
Offer: Applicable
Consequences of Tender
Offers: Subject
to Section 7(b) of the Master Confirmation:
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(a) Share-for-Share:
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Modified Calculation Agent
Adjustment
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(b) Sha
re-for-Other:
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Cancellation and Payment on that portion of the Other
Consideration that consists of cash; Modified Calculation Agent
Adjustment on the remainder of the Other
Consideration.
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(c) Share-for-Combined:
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Component
Adjustment
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Determining Party:
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GS&Co.
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Nationalization, Insolvency or Delisting:
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Subject to Section 7(a) of this Master Confirmation, Negotiated
Close-out; provided that in addition to the provisions of Section
12.6(a)(iii) of the Equity Definitions, it shall also constitute a
Delisting if the Exchange is located in the United States and the
Shares are not immediately re-listed, re-traded or re-quoted on any
of the New York Stock Exchange, the American Stock Exchange or The
NASDAQ National Market (or their respective successors); if the
Shares are immediately re-listed, re-traded or re-quoted on any
such exchange or quotation system, such exchange or quotation
system shall be deemed to be the
Exchange.
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Additional Disruption Events:
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(a) Change in Law:
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Applicable; provided that Section 12.9(a)(ii)(Y) of the Equity
Definitions is hereby
deleted.
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(b) Failure to Deliver:
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Not
Applicable
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(c)
Insolvency Filing:
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Applicable
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(d) Loss of Stock Borrow:
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Applicable; provided that Loss of Stock Borrow shall not
constitute an Additional Disruption Event so long as Counterparty
agrees to pay the Hedging Party the amount by which the stock loan
rate necessary to maintain a borrowing of Shares by GS&Co.
(“Hedge Position”) in connection with the Transaction
exceeds the Maximum Stock Loan
Rate.
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Maximum Stock Loan Rate
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30 basis
points
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(e) Hedging Disruption:
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Not
Applicable.
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(f) Increased Cost of Hedging:
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Not
Applicable.
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(g) Increased Cost of Stock
Borrow:
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Not
Applicable.
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Hedging Party:
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GS&Co.
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Determining Party:
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GS&Co.
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Non-Reliance:
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Applicable
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Agreements and Acknowledgements Regarding Hedging Activities:
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Applicable
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Additional Acknowledgements:
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Applicable
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Net Share Settlement following Extraordinary Event:
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Counterparty shall have the right, in its sole discretion, to
make any payment required to be made by it pursuant to
Sections 12.7 or 12.9 of the Equity Definitions (except with
respect to any portion of the consideration for the Shares
consisting of cash in the event of a Merger Event or Tender Offer)
following the occurrence of an Extraordinary Event by electing to
Net Share Settle the Transactions under this Master Confirmation in
accordance with the terms, and subject to the conditions, for Net
Share Settlement herein by giving written notice to GS&Co. of
such election on the day that the notice fixing the date that the
Transactions are terminated or cancelled, as the case may be, (the
“Cancellation Date”) pursuant to the applicable
provisions of Section 12 of the Equity Definitions is
effective. If Counterparty elects Net Share Settlement:
(a) the Net Share Valuation Date shall be the date specified
in the notice fixing the date that the Transactions are terminated
or cancelled, as the case may be; provided that the Net Share
Valuation Date shall be either the Exchange Business Day that
such notice is effective or the first Exchange Business Day
immediately following the Exchange Business Day that such notice is
effective, (b) the Net Share Settlement Date shall be deemed to be
the Exchange Business Day immediately following the Cancellation
Date and (c) all references to the Forward Cash Settlement Amount
, the Fixed Amount and the Counterparty
Additional Payment Amount, as the case may be, in Annex B hereto
shall be deemed to be references to the Cancellation Amount.
The
definition of “Cancellation Amount” in Section 12.8 of
the Equity Definitions is hereby amended by inserting the following
paragraph: “(h) The Determining Party shall show the other
party in reasonable detail its calculation of the Cancellation
Amount, including without limitation providing all relevant
quotations and assumptions and specifying the methodologies used in
sufficient detail so as to enable the other party to replicate the
calculation”.
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Net Share Settlement Upon Early Termination:
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Counterparty shall have the right, in its sole discretion, to
make any payment required to be made by it (the “Early
Termination Amount”) pursuant to Sections 6(d) and 6(e)
of the Agreement following the occurrence of an Early Termination
Date in respect of the Agreement by electing to Net Share Settle
all the Transactions under this Master Confirmation in accordance
with the terms, and subject to the conditions, for Net Share
Settlement herein by giving written notice to GS&Co. of such
election on the day that the notice fixing an Early Termination
Date is effective. If Counterparty elects Net Share
Settlement: (a) the Net Share Valuation Date shall be the date
specified in the notice fixing an Early Termination Date; provided
that the Net Share Valuation Date shall be either the Exchange
Business Day that such notice is effective or the first Exchange
Business Day immediately following the Exchange Business Day that
such notice is effective, (b) the Net Share Settlement Date shall
be deemed to be the Exchange Business Day immediately following the
Early Termination Date (except for an Early
Termination as a result of Section 7(d), in which event the Net
Share Settlement Date shall be deemed to be the tenth Exchange
Business Day following the Early Termination Date) and (c) all references to Forward Cash Settlement
Amount , the Fixed
Amount and the Counterparty Additional Payment Amount, as the case
may be, in Annex B hereto shall be deemed references to the Early
Termination Amount.
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Transfer:
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Notwithstanding anything to the contrary in the Agreement,
GS&Co. may assign, transfer and set over all rights, title and
interest, powers, privileges and remedies of GS&Co. under any
Transaction, in whole or in part, to an affiliate of GS&Co.
that is fully and unconditionally guaranteed by The Goldman Sachs
Group, Inc. without the consent of Counterparty, provided that
Counterparty is not required to make a payment to GS&Co. in
respect of an Indemnifiable Tax as a result of such
transfer.
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GS&Co. Payment Instructions:
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Chase Manhattan Bank New York
For A/C Goldman, Sachs & Co.
A/C # 930-1-011483
ABA: 021-000021
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Counterparty Payment Instructions:
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PG&E Corporation Master Account No. 099023
Mellon Trust of New England, N.A.
Boston, MA
ABA Routing No: 011001234
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2.
Calculation Agent : GS&Co.
3.
Representations, Warranties and Covenants of GS&Co. and
Counterparty .
(a) Each
party represents and warrants that it (i) is an “eligible
contract participant”, as defined in the U.S. Commodity
Exchange Act, as amended and (ii) is entering into each Transaction
hereunder as principal (and not as agent or in any other capacity,
fiduciary or otherwise) and not for the benefit of any third
party.
(b) Each
party acknowledges that the offer and sale of each Share Forward Transaction
to it is intended to be exempt from registration under the
Securities Act of 1933, as amended (the “Securities
Act”), by virtue of Section 4(2) thereof and the provisions
of Regulation D promulgated thereunder (“Regulation
D”); and this acknowledgement shall not be deemed to extend
to Settlement Shares or Early Settlement Shares. Accordingly,
each party represents and warrants to the other that (i) it has the
financial ability to bear the economic risk of its investment in
each Share Forward
Transaction and is able to bear a total loss of its investment,
(ii) it is an “accredited investor” as that term
is defined under Regulation D, (iii) it will purchase each Share Forward Transaction
for investment and not with a view to the distribution or resale
thereof, and (iv) the disposition of each
Share Forward Transaction is restricted
under this Master Confirmation and each Supplemental Confirmation,
the Securities Act and state securities laws.
4.
Additional Representations, Warranties and Covenants of
Counterparty.
As of the date hereof and the date
of each Supplemental Confirmation, Counterparty represents,
warrants and covenants to GS&Co. that:
(a) the
purchase or writing of each Transaction will not violate
Rule 13e-1 or Rule 13e-4 under the Securities Exchange
Act of 1934, as amended (the “Exchange Act”);
(b) is
not entering into any Transaction on the basis of, and is not aware
of, any material non-public information with respect to the Shares
or in anticipation of, in connection with, or to facilitate, a
distribution of its securities, a self tender offer or a
third-party tender offer;
(c) it
is not entering into any Transaction to create, and will not engage
in any other securities or derivative transaction to create, a
false or misleading appearance of active trading or market activity
in the Shares (or any security convertible into or exchangeable for
the Shares), or which would otherwise violate the Exchange Act;
(d) Counterparty
is in compliance with its reporting obligations under the Exchange
Act and its most recent Annual Report on Form 10-K, together with
all reports subsequently filed by it pursuant to the Exchange Act,
taken together and as amended and supplemented to the date of this
representation, do not, as of their respective filing dates,
contain any untrue statement of a material fact or omit any
material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances in which
they were made, not misleading;
(e) each
Transaction is being entered into pursuant to a publicly disclosed
Share buy-back program and its Board of Directors has approved the
use of the Transaction to effect the Share buy-back program;
(f) notwithstanding
the generality of Section 13.1 of the Equity Definitions,
GS&Co. is not making any representations or warranties with
respect to the treatment of any Transaction under FASB Statements
149 or 150, EITF 00-19 (or any successor issue statements) or under
FASB’s Liabilities & Equity Project;
(g) it
has not, and during any Valuation Period (as extended pursuant to
the provisions of Section 5 and
“Valuation Period” herein) will not, enter into
agreements similar to the Transactions described herein except with GS&Co. or an entity affiliated with
GS&Co. where the valuation period in
such other transaction will overlap at any time (including as a
result of extensions in such valuation period as provided in the
relevant agreements) with any Valuation Period (as extended
pursuant to the provisions of Section 5 and “Valuation
Period” herein) under this Master Confirmation. In the
event that the valuation period in any other similar transaction
with an entity other than GS&Co. or an
entity affiliated with GS&Co. overlaps
with any Valuation Period under this Master Confirmation as a
result of any extension made pursuant to the provisions of Section
5 and “Valuation Period” herein, Counterparty shall
promptly amend such transaction to avoid any such overlap; and
(h) it
shall report each Transaction as required under the Exchange Act and the
regulations promulgated thereunder.
5.
Suspension of Valuation Period; Extension of Valuation
Period .
(a) If
Counterparty concludes that it will be engaged in a distribution of
the Shares for purposes of Regulation M promulgated under the
Exchange Act (“Regulation M”), Counterparty agrees that
it will, on one Scheduled Trading Day’s written notice,
direct GS&Co. not to purchase Shares in connection with hedging
any Transaction during the “restricted period” (as
defined in Regulation M). If on any Scheduled Trading Day
Counterparty delivers written notice (and confirms by telephone) by
8:30 a.m. New York Time (the “Notification Time”), then
such notice shall be effective to suspend the Valuation Period as
of such Notification Time. In the event that Counterparty
delivers notice and/or confirms by telephone after the Notification
Time, then the Valuation Period shall be suspended effective as of
8:30 a.m. New York Time on the following Scheduled Trading Day or
as otherwise required by law or agreed between Counterparty and
GS&Co. The Valuation Period shall be suspended and the
Valuation Date extended for each Scheduled Trading Day in such
restricted period.
(b) In
the event that GS&Co. concludes, in its reasonable discretion,
that it is appropriate with respect to any legal, regulatory or
self-regulatory requirements or related policies and procedures
(whether or not such requirements, policies or procedures are
imposed by law or have been voluntarily adopted by GS&Co.), for
it to refrain from purchasing Shares on any Scheduled Trading Day
during the Valuation Period, GS&Co. may by written notice to
Counterparty elect to suspend the Valuation Period for such number
of Scheduled Trading Days as is specified in the notice. The
notice shall not specify, and GS&Co. shall not otherwise
communicate to Counterparty, the reason for GS&Co.’s
election to suspend the Valuation Period. The Valuation
Period shall be suspended and the Valuation Date extended for each
Scheduled Trading Day occurring during any such suspension.
(c) In
the event that the Valuation Period is suspended pursuant to
Sections 5(a) or (b) above during the regular trading session on
the Exchange, then the Calculation Agent in
its sole discretion shall, in calculating the Forward Cash
Settlement Amount, extend the Valuation Period and make adjustments
to the weighting of each Relevant Price for purposes of determining
the Settlement Price, with such adjustments based on, among other
factors, the duration of any such suspension and the volume,
historical trading patterns and price of the Shares.
(d) On
the first Exchange Business Day of each calendar week during the
Valuation Period, to the extent that the Number of Daily Reference
Shares exceeds 25% of the ADTV (as defined in Rule 10b-18 under the
Exchange Act (“Rule 10b-18”)) for the Shares on such
day, the Calculation Agent will (i) adjust the Number of Daily
Reference Shares to equal an amount equal to 15% of ADTV for the
Shares determined and effective on such Exchange Busines
