EXHIBIT 10.1
EXECUTION COPY+
Goldman Sachs & Co. | 85 Broad Street | New York, New York 10004 |
Tel: 212 902 1000
Opening Transaction
- --------------------------------------------------------------------------------
| CIT Group Inc.
To: | 1211 Avenue of the Americas
| New York, NY 10036
- --------------------------------------------------------------------------------
|
A/C: | [Insert Account Number]
- --------------------------------------------------------------------------------
|
From: | Goldman, Sachs & Co.
- --------------------------------------------------------------------------------
|
Re: | Prepaid Enhanced VWAP Repurchase Transaction
- --------------------------------------------------------------------------------
|
Ref. No: | [Insert Reference Number]
- --------------------------------------------------------------------------------
|
Date: | July 19, 2005
- --------------------------------------------------------------------------------
This master confirmation ("Master Confirmation"), dated as of July 19,
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 CIT Group Inc. ("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
Schedule A hereto and 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 evidence 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.
All provisions contained in or incorporated by reference in the form of
the 1992 ISDA Master Agreement (Multi-Currency Cross Border) (the "ISDA Form" or
the "Agreement") will govern this Master Confirmation and each Supplemental
Confirmation except as expressly modified below. This Master Confirmation and
each Supplemental Confirmation, together with all other documents referring to
the Agreement confirming Transactions entered into between GS&Co. and
Counterparty (notwithstanding anything to the contrary in a Confirmation), 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 for (i)
the election of Loss and Second Method, New York law (without regard to the
conflicts of law principles) as the governing law and US Dollars ("USD") as the
Termination Currency, (ii) the election that subparagraph (ii) of Section 2(c)
will not apply to Transactions and (iii) the replacement of the word "third" in
the last line of Section 5(a)(i) with the word "first". Notwithstanding the
terms of Sections 5 and 6 of the Agreement, if at any time and so long as
Counterparty satisfied its payment obligations
- ----------
+ Confidential portions of this agreement has been omitted and filed
separately with the Securities and Exchange Commission under a
Confidential Treatment Request. The portions of this agreement that has
been omitted and filed separately with the Securities and Exchange
Commission are denoted by the use of an asterisk.
under Section 2(a)(i) of the Agreement in respect of all Transactions and has at
the time no further payment obligations under such Section, then unless GS&Co.
is required pursuant to appropriate proceedings to return to Counterparty, or
otherwise returns to Counterparty upon demand of Counterparty, any portion of
any such payment (a) the occurrence of an event described in Section 5(a)
(excluding Sections 5(a)(ii) and 5(a)(iv)) of the Agreement with respect to
Counterparty shall not constitute an Event of Default or a Potential Event of
Default with respect to Counterparty as the Defaulting Party and (b) GS&Co.
shall be entitled to designate an Early Termination Date pursuant to Section 6
of the Agreement only as a result of the occurrence of a Termination Event set
forth in (i) either Section 5(b)(i), 5(b)(ii) or 5(b)(v) of the Agreement with
respect to GS&Co. as the Affected Party or (ii) Section 5(b)(iii) of the
Agreement with respect to GS&Co. as the Burdened Party.
All provisions contained in the Agreement shall govern this Master
Confirmation and the related Supplemental Confirmation relating to a Transaction
except as expressly modified below 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 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 the relevant Transaction), shall govern each such
Transaction.
General Terms:
Trade Date: For each Transaction, as set forth in the
Supplemental Confirmation.
Buyer: Counterparty
Seller: GS&Co.
Shares: Common stock of Counterparty (Ticker: CIT)
Forward Price: The average of the New York 10b-18 Volume Weighted
Average Price per share of the Shares for the
regular trading session (including any extensions
thereof) for each Exchange Business Day in the
Calculation Period (without regard to pre-open or
after hours trading outside of any regular trading
session for each Exchange Business Day), as
published by Bloomberg at 4:15 New York time on
each Exchange Business Day during the Calculation
Period.
[*]
Calculation Period: Each Exchange Business Day from and
including the Exchange Business Day following the
Initial Hedge Completion Date to and including the
Termination Date (as adjusted in accordance with
Section 6 herein and pursuant to Market Disruption
Event below).
Termination Date: For each Transaction, as set forth in the
Supplemental Confirmation (as the same may be
postponed in accordance with the provisions of
"Calculation Period" and Section 6 herein).
Hedge Period: For each Transaction, as set forth in the
Supplemental Confirmation.
- ----------
* Confidential Treatment Requested and the Redacted Material has been
separately filed with the Commission.
-2-
Initial Hedge
Completion Date: For each Transaction, as set forth in the
Supplemental Confirmation.
Hedge Period Reference
Price: The average of the New York 10b-18 Volume Weighted
Average Price per share of the Shares for the
regular trading session (including any extensions
thereof) for each Exchange Business Day in the
Hedge Period (without regard to pre-open or after
hours trading outside of any regular trading
session for each Exchange Business Day), as
published by Bloomberg.
Market Disruption Event: 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 Hedge Period or
Calculation Period or" after the word "material,"
in the third line thereof.
Notwithstanding anything to the contrary in the
Equity Definitions, to the extent that any
Scheduled Trading Day in the Hedge Period or
Calculation Period is a Disrupted Day, the
Calculation Agent shall have the option in its
sole discretion to either (i) determine the
weighting of each Rule 10b-18 eligible transaction
in the Shares on the relevant Disrupted Day using
its commercially reasonable judgment for purposes
of calculating the Hedge Period Reference Price or
Forward Price, as applicable, or (ii) elect to
extend the Hedge Period or Calculation Period, or
both in the event of a Disrupted Day in the Hedge
Period, as applicable, by one Scheduled Trading
Day.
Exchange: NYSE
Prepayment\Variable
Obligation: Applicable
Prepayment Amount: For each Transaction, as set forth in the
Supplemental Confirmation.
Prepayment Date: Three (3) Exchange Business Days following the
first day of the Hedge Period.
Seller Payment Amount: Not Applicable.
Seller Payment Date: Not Applicable.
Counterparty Additional
Payment Amount: Not Applicable.
Counterparty Additional
Payment Date: Not Applicable.
Settlement Terms:
Physical Settlement: Applicable
[*]
Settlement Date: Three (3) Exchange Business Days following the
Termination Date.
Settlement Currency: USD (all amounts shall be converted to the
Settlement Currency by the Calculation Agent).
- ----------
* Confidential Treatment Requested and the Redacted Material has been
separately filed with the Commission.
-3-
Initial Shares: For each Transaction, as set forth in the
Supplemental Confirmation.
Initial Share Delivery: GS&Co. shall deliver a number of shares equal to
the Initial Shares to Counterparty on the Initial
Share Delivery Date in accordance with Section 9.4
of the Equity Definitions, with the Initial Share
Delivery Date deemed to be a "Settlement Date" for
purposes of such Section 9.4.
Initial Share Delivery
Date: Three (3) Exchange Business Days following the
first day of the Hedge Period.
Minimum Shares: For each Transaction, as set forth in the
Supplemental Confirmation.
Minimum Share Delivery: GS&Co. shall deliver a number of shares equal to
the excess, if any, of the Minimum Shares over the
Initial Shares on the Minimum Share Delivery Date
in accordance with Section 9.4 of the Equity
Definitions, with the Minimum Share Delivery Date
deemed to be a "Settlement Date" for purposes of
such Section 9.4.
Minimum Share Delivery
Date: Three (3) Exchange Business Days following the
Initial Hedge Completion Date.
Maximum Shares: For each Transaction, as set forth in the
Supplemental Confirmation.
Share Adjustments:
Method of Adjustment: Calculation Agent Adjustment. Notwithstanding
anything to the contrary in the Equity
Definitions, the declaration of an Extraordinary
Dividend by Counterparty shall not constitute a
Potential Adjustment Event for purposes of Section
11.2(e) of the Equity Definitions.
Extraordinary Events:
Consequences of
Merger Events and
Tender Offers:
(a) Share-for-Share: Modified Calculation Agent Adjustment; provided
that upon the occurrence of any such Extraordinary
Event, the Calculation Agent shall adjust the
Transaction to preserve the economic condition of
the parties prior to such event by compensating
the parties for the Adjustment Value of the
Transaction as determined in accordance with
Section 12.7(b)(i) of the Equity Definitions;
provided that the Calculation Agent shall
determine such amount in accordance with the
method of calculation in Section 12.7(b)(i) of the
Equity Definitions as if (i) the Transaction were
an Option Transaction and (ii) the "Expiration
Date" was the Termination Date. For purposes of
any such calculation, GS&Co. shall determine the
inputs used in such calculation after consultation
with Counterparty.
(b) Share-for-Other: Cancellation and Payment (Agreed Model); provided
that the Calculation Agent shall determine such
amount in accordance with the method of
calculation in Section 12.7(b)(i) of the Equity
Definitions as if (i) the Transaction were an
Option Transaction and (ii) the "Expiration Date"
was the Termination Date. For purposes of any such
calculation, GS&Co. shall determine the inputs
used in such calculation after consultation with
Counterparty, except to the extent GS&Co. needs to
calculate a price of the underlying stock in
connection with such calculation (including the
calculation of the "Settlement Price"), GS&Co.
shall determine such price by reference to the
volume weighted average price per Share over a
reasonable time period after consulting with
Counterparty regarding the length of such time
period.
(c) Share-for-
Combined: Component Adjustment
Determining Party: GS&Co.
Tender Offer: Applicable
Nationalization,
Insolvency or Delisting: Negotiated Close-out; provided that Section
12.6(c)(i) of the Equity Definitions shall be
amended by inserting a ";" after the word "effect"
in the fourth line thereof by and deleting the
remainder of the provision; provided further 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.
Additional Disruption Events:
(a) Change in Law: Applicable
(b) [*]
Hedging Party: GS&Co.
- ----------
* Confidential Treatment Requested and the Redacted Material has been
separately filed with the Commission.
-4-
Determining Party: GS&Co.
Non-Reliance/Agreements
and Acknowledgements
Regarding Hedging
Activities/Additional
Acknowledgements: Applicable
Transfer: 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 this
Transaction, in whole or in part, to an affiliate
of GS&Co. that is guaranteed by The Goldman Sachs
Group, Inc. without the consent of Counterparty,
provided, however, that GS&Co. may not assign its
rights or delegate its obligations under this
Transaction if such assignment or delegation shall
result in (A) an Event of Default with respect to
which GS&Co. is the Defaulting Party, a
Termination Event, a Potential Event of Default
with respect to which GS&Co. would be the
Defaulting Party or a potential Termination Event,
(B) Counterparty being required to pay to the
transferee an amount in respect of an
Indemnifiable Tax under Section 2(d)(i)(4) (except
in respect of interest under Section 2(e),
6(d)(ii) or 6(e)) greater than the amount that
Counterparty would have been required to pay
GS&Co. in the absence of such transfer, or (C)
Counterparty receiving a payment from which an
amount has been withheld or deducted, on account
of a Tax under Section 2(d)(i) (except in respect
of interest under Section 2(e), 6(d)(ii) or 6(e)),
in excess of the amount that GS&Co. would have
been required to so withhold or deduct in the
absence of such transfer, unless the transferee
would be required to make additional payments
pursuant to Section 2(d)(i)(4) corresponding to
such withholding or deduction.
GS&Co. Payment
Instructions: Chase Manhattan Bank New York For A/C Goldman,
Sachs & Co. A/C #930-1-011483 ABA: 021-000021
2. Calculation Agent. GS&Co.
3. Additional Mutual Representations, Warranties and Covenants. In addition to
the representations and warranties in the Agreement, each party represents,
warrants and covenants to the other party that:
(a) Eligible Contract Participant. It is an "eligible contract
participant", as defined in the U.S. Commodity Exchange Act (as amended), and is
entering into each Transaction hereunder as principal and not for the benefit of
any third party;
(b) Accredited Investor. Each party acknowledges that the offer and sale
of each 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 thereunder ("Regulation D").
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
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 Transaction for investment and not with a view to the distribution
or resale thereof, and (iv) the disposition of each Transaction is restricted
under this Master Confirmation, the Securities Act and state securities laws;
4. Additional Representations, Warranties and Covenants of GS&Co. In
addition to the representations, warranties and covenants in the Agreement and
those contained herein, as of (i) the date hereof, (ii) the Trade Date and (iii)
to the extent indicated below, each day during the Hedge Period and Calculation
Period, GS&Co. represents, warrants and covenants to Counterparty that:
-5-
(a) (i) during all relevant times beginning the first day of the Hedge
Period through and including the Initial Hedge Completion Date, all purchases of
Shares in connection with its Hedge Positions related to this Transaction, and
(ii) in connection with purchases made during the Calculation Period up to the
Maximum Shares, it will comply with the provisions of Rule 10b-18(b)(2), (3) and
(4) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
subject to any delays between the execution and reporting of a trade of the
Shares on the Exchange and other circumstances beyond its reasonable control;
and
(b) 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.
5. Additional Representations, Warranties and Covenants of Counterparty. In
addition to the representations, warranties and covenants in the Agreement and
those contained herein, as of (i) the date hereof, (ii) the Trade Date and (iii)
to the extent indicated below, each day during the Hedge Period and Calculation
Period, 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 Exchange Act;
(b) it 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) 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 derivatives to effect the Share buy-back program;
(e) notwithstanding the generality of Section 13.1 of the Equity
Definitions, it acknowledges that GS&Co. is not making any representations or
warranties with respect to the treatment of any Transaction under FASB
Statements 133 as amended or 150, EITF 00-19 (or any successor issue statements)
or under FASB's Liabilities & Equity Project;
(f) 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;
(g) Counterparty shall report each Transaction as required under
Regulation S-K and/or Regulation S-B under the Exchange Act, as applicable;
(h) On the Trade Date the Shares or securities that are convertible into,
or exchangeable or exercisable for Shares are not subject to a "restricted
period" as such term is defined in Regulation M promulgated under the Exchange
Act and Counterparty agrees to provide written notice to GS&Co. to the extent
the Shares or securities that are convertible into, or exchangeable or
exercisable for Shares become subject to a "restricted period"; and
(i) Counterparty acknowledges that each Transaction is a derivatives
transaction in which it has granted GS&Co. an option. GS&Co. may purchase shares
for its own account at an average price that may be greater than, or less than,
the price paid by Counterparty under the terms of the related Transaction.
-6-
6. Suspension of Hedge Period and/or Calculation Period.
(a) If Counterparty concludes that it will be engaged in a distribution of
the Shares for purposes of 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
Calculation Period or the Hedge Period, as the case may be, as of such
Notification Time. In the event that Counterparty delivers notice and/or
confirms by telephone after the Notification Time, then the Calculation Period
or the Hedge Period, or both, as the case may be, 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
Calculation Period or the Hedge Period, as the case may be, shall be suspended
and the Termination Date or the Initial Hedge Completion Date, as the case may
be, extended for each Scheduled Trading Day in such restricted period.
(b) In the event that GS&Co. concludes upon the advice of reputable
counsel that is required with respect to any legal, regulatory or
self-regulatory requirements for it to refrain from purchasing Shares on any
Scheduled Trading Day during the Hedge Period or the Calculation Period due to
events outside the control of both parties, GS&Co. may by written notice to
Counterparty elect to suspend the Hedge Period or the Calculation 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 Hedge Period or the Calculation
Period. The Calculation Period or the Hedge Period or both, as the case may be,
shall be suspended and the Termination Date or the Initial Hedge Completion
Date, as the case may be, extended for each Scheduled Trading Day in such
period.
(c) In the event that the Calculation Period or the Hedge Period, as the
case may be, is suspended pursuant to Section 6(a) above during the regular
trading session on the Exchange then the Calculation Agent in its good faith
commercially reasonable discretion and after consultation with Counterparty
shall, in calculating the Forward Price, extend the Calculation Period or the
Hedge Period, or both, as the case may be, or make adjustments to the weighting
of each Rule 10b-18 eligible transaction in the Shares on the relevant Exchange
Business Days during the Calculation Period or the Hedge Period, as the case may
be, for purposes of determining the Forward 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.
7. Counterparty Purchases. Counterparty represents, warrants and covenants to
GS&Co. that for each Transaction:
(a) Counterparty is entering into this Master Confirmation and each
Transaction hereunder in good faith and not as part of a plan or scheme to evade
the prohibitions of Rule 10b5-1 under the Exchange Act ("Rule 10b5-1"). It is
the intent of the parties that each Transaction entered into under this Master
Confirmation comply with the requirements of Rule 10b5-1(c)(1)(i)(A) and (B) and
each Transaction entered into under this Master Confirmation shall be
interpreted to comply with the requirements of Rule 10b5-1(c). Counterparty will
not seek to control or influence GS&Co. to make "purchases or sales" (within the
meaning of Rule 10b5-1(c)(1)(i)(B)(3)) under any Transaction entered into under
this Master Confirmation, including, without limitation, GS&Co.'s decision to
enter into any hedging transactions. Counterparty represents and warrants that
it has consulted with its own advisors as to the legal aspects of its adoption
and implementation of this Master Confirmation, each Supplemental Confirmation
and each Trade Notification under Rule 10b5-1.
(b) During the Hedge Period and Calculation Period, Counterparty (or any
"affiliated purchaser" as defined in Rule 10b-18 under the Exchange Act ("Rule
10b-18")) shall not without the prior written consent of GS&Co. directly or
indirectly purchase any Shares, listed contracts on the Shares or securities
that are convertible into, or exchangeable or exercisable for Shares (including,
without limitation, any Rule 10b-18 purchases of blocks (as defined in Rule
10b-18)) during any Hedge Period or Calculation Period, except through GS&Co.
and in compliance with Rule 10b-18 or otherwise in a manner that Counterparty
and GS&Co. believe is in compliance with applicable requirements;
-7-
8. Additional Termination Events. Additional Termination Event will apply. The
following will constitute Additional Termination Events, in each case with
Counterparty as the sole Affected Party:
(a) Notwithstanding anything to the contrary in the Equity Definitions,
the occurrence of a Nationalization, Insolvency or a Delisting (in each case
effective on the Announcement Date as determined by the Calculation Agent); and
(b) Notwithstanding anything to the contrary in the Equity Definitions, an
Extraordinary Dividend is declared by the Issuer. "Extraordinary Dividend" means
the dividend amount per Share (declared by Counterparty to holders of record of
a Share on any record date occurring during the period from and including the
first day of the Hedge Period to and including the Termination Date) in excess
of USD 0.16 per Share per quarter.
9. Certain Payments and Deliveries. Notwithstanding anything to the contrary
herein, or in the Equity Definitions, if at any time (i) an Early Termination
Date occurs and GS&Co. would be required to make a payment pursuant to Sections
6(d) and 6(e) of the Agreement, (ii) a Tender Offer occurs and GS&Co. would be
required to make a payment pursuant to Sections 12.3 and 12.7 of the Equity
Definitions, (iii) a Merger Event occurs and GS&Co. would be required to make a
payment pursuant to Sections 12.2 and 12.7 of the Equity Definitions or (iv) an
Additional Disruption Event occurs and GS&Co. would be required to make a
payment pursuant to Sections 12.8 and 12.9 of the Equity Definitions, then in
lieu of such payment, GS&Co. shall deliver to Counterparty, at the time such
payment would have been due and in the manner provided under "Physical
Settlement" in the Equity Definitions, a number of Shares (or, in the case of a
Merger Event, common equity securities of the surviving entity) equal to the
quotient obtained by dividing (A) the amount that would have been so payable by
(B) the fair market value per Share (or per unit of such common equity security)
of the Shares (or units) so delivered at the time of such delivery, as
determined by the Calculation Agent in a commercially reasonable manner.
For purposes of calculating any amount due under (i) Section 6(d) and 6(e)
of the Agreement in connection with an Early Termination Date or (ii) pursuant
to Section 12.8 of the Equity Definitions upon the occurrence of any Additional
Disruption Event listed herein, the Calculation Agent shall determine such
amount in accordance with the method of calculation in Section 12.7(b)(i)(A) of
the Equity Definitions as if (i) the Transaction were an Option Transaction (ii)
the "Closing Date" was the Early Termination Date or the date of such Additional
Disruption Event and (iii) the "Expiration Date" was the Termination Date. The
Calculation Agent hereby agrees to provide the parties with a statement of its
calculation hereunder, and both parties agree to keep such statement
confidential.
For purposes of the valuation of any amounts due in connection with any
Early Termination Date or Additional Disruption Event. GS&Co. shall determine
the inputs used in such calculation after consultation with Counterparty, except
to the extent GS&Co. needs to calculate a price of the underlying stock in order
to value its Hedge Positions (including the calculation of the "Settlement
Price"), GS&Co. shall determine such price by reference to the volume weighted
average price per Share over a reasonable time period after consulting with
Counterparty regarding the length of such time period.
10. Special Provisions for Merger Events. Notwithstanding anything to the
contrary herein or in the Equity Definitions, to the extent that an Announcement
Date for a potential Merger Transaction occurs during any Hedge Period:
(a) Promptly after request from GS&Co., Counterparty shall provide GS&Co.
with written notice specifying (i) Counterparty's average daily Rule 10b-18
Purchases (as defined in Rule 10b-18) during the three full calendar months
immediately preceding the Announcement Date that were not effected through
GS&Co. or its affiliates and (ii) the number of Shares purchased pursuant to the
proviso in Rule 10b-18(b)(4) under the Exchange Act for the three full calendar
months preceding the Announcement Date. Such written notice shall be deemed to
be a certification by Counterparty to GS&Co. that such information is true and
correct. Counterparty understands that GS&Co. will use this information in
calculating the trading volume for purposes of Rule 10b-18; and
(b) GS&Co. in its sole discretion may extend the Initial Hedge Completion
Date and the Termination Date to account for the number of Shares that could be
purchased on each day during the Hedge Period in compliance with Rule 10b-18
following the Announcement Date.
-8-
"Merger Transaction" means any merger, acquisition or similar transaction
involving a recapitalization as contemplated by Rule 10b-18(a)(13)(iv) under the
Exchange Act.
11. Governing Law. The Agreement, this Master Confirmation, each Supplemental
Confirmation and all matters arising in connection with the Agreement, this
Master Confirmation and each Supplemental Confirmation shall be governed by, and
construed and enforced in accordance with, the laws of the State of New York.
12. Waiver of Trial by Jury. Each party waives, to the fullest extent permitted
by applicable law, any right it may have to a trial by jury in respect of any
suit, action or proceeding relating to this Master Confirmation.
13. Counterparts. This Master Confirmation may be executed in any number of
counterparts, all of which shall constitute one and the same instrument, and any
party hereto may execute this Master Confirmation by signing and delivering one
or more counterparts.
-9-
14. Counterparty hereby agrees (a) to check this Master Confirmation carefully
and immediately upon receipt so that errors or discrepancies can be promptly
identified and rectified and (b) to confirm that the foregoing (in the exact
form provided by GS&Co.) correctly sets forth the terms of the agreement between
GS&Co. and Counterparty with respect to any particular Transaction to which this
Master Confirmation relates, by manually signing this Master Confirmation or
this page hereof as evidence of agreement to such terms and providing the other
information requested herein and immediately returning an executed copy to
Equity Derivatives Documentation Department, Facsimile No. 212-428-1980/83.
Yours faithfully,
GOLDMAN, SACHS & CO.
By: /s/ Kelly C. Coffey
-------------------------------------
Authorized Signatory
Agreed and Accepted By:
CIT GROUP INC.
By: /s/ Christopher Grimes
----------------------------------------------------
Name: Christopher Grimes
Title: Senior Vice President and Assistant Treasurer
SCHEDULE A
SUPPLEMENTAL CONFIRMATION
CIT Group Inc.
To: 1211 Avenue of the Americas
New York, NY 10036
From: Goldman, Sachs & Co.
Subject: Issuer VWAP Prepaid Share Forward Transaction
Ref. No: [Insert Reference No.]
Date: July 19, 2005
- --------------------------------------------------------------------------------
The purpose of this Supplemental Confirmation is to confirm the terms and
conditions of the Transaction entered into between Goldman, Sachs & Co.
("GS&Co.") and CIT Group Inc. ("Counterparty") (together, the "Contracting
Parties") on the Trade Date specified below. This Supplemental Confirmation is a
binding contract between GS&Co. and Counterparty as of the relevant Trade Date
for the Transaction referenced below.
The definitions and provisions contained in the Master Confirmation
specified below are incorporated into this Supplemental Confirmation. In the
event of any inconsistency between those definitions and provisions and this
Supplemental Confirmation, this Supplemental Confirmation will govern.
1. This Supplemental Confirmation supplements, forms part of, and is subject to
the Master Confirmation dated as of July 19, 2005 (the "Master Confirmation")
between the Contracting Parties, as amended and supplemented from time to time.
All provisions contained in the Master Confirmation govern this Supplemental
Confirmation except as expressly modified below.
2. The terms of the Transaction to which this Supplemental Confirmation relates
are as follows:
Trade Date: July 19, 2005
Hedge Period: Each Exchange Business Day from and including July
25, 2005 to and including the Initial Hedge
Completion Date.
Initial Hedge Completion
Date: [*] (as the same may be postponed in accordance
with the provisions of "Market Disruption Event"
and Section 6 of the Master Confirmation)
Termination Date: [*]
Prepayment Amount: USD $500,000,000
Counterparty Additional
Payment Amount: Not Applicable
Seller Payment Amount: Not Applicable
[*]
Initial Shares: The number of Shares equal to the product of (i)
[*]% and (ii) the Prepayment Amount divided by
[*]% of the Closing Price.
- ----------
* Confidential Treatment Requested and the Redacted Material has been
separately filed with the Commission.
A-1
Closing Price: The price per Share determined by the Calculation
Agent as of the Valuation Time on the Exchange
Business Day immediately preceding the first day
of the Hedge Period, as reported in the official
real-time price dissemination mechanism for the
Exchange.
Minimum Shares: A number of shares equal to (a) the Prepayment
Amount divided by (b) [*]% of the Hedge Period
Reference Price, or, if greater, the Initial
Shares.
Maximum Shares: A number of shares equal to (a) the Prepayment
Amount divided by (b) [*]% of the Hedge Period
Reference Price, or, if greater, the Initial
Shares.
3. Counterparty represents and warrants to GS&Co. that neither it nor any
"affiliated purchaser" (as defined in Rule 10b-18 under the Exchange Act) has
made any purchases of blocks pursuant to the proviso in Rule 10b-18(b)(4) under
the Exchange Act during the four full calendar weeks immediately preceding the
Trade Date.
4. Counterparts. This Supplemental Confirmation may be executed in any number of
counterparts, all of which shall constitute one and the same instrument, and any
party hereto may execute this Supplemental Confirmation by signing and
delivering one or more counterparts.
Counterparty hereby agrees (a) to check this Supplemental Confirmation
carefully and immediately upon receipt so that errors or discrepancies can be
promptly identified and rectified and (b) to confirm that the foregoing (in the
exact form provided by GS&Co.) correctly sets forth the terms of the agreement
between GS&Co. and Counterparty with respect to this Transaction, by manually
signing this Supplemental Confirmation or this page hereof as evidence of
agreement to such terms and providing the other information requested herein and
immediately returning an executed copy to Equity Derivatives Documentation
Department, facsimile No. 212-428-1980/83.
Yours sincerely,
GOLDMAN, SACHS & CO.
By: /s/ Kelly C. Coffey
---------------------------------------
Authorized Signatory
Agreed and Accepted By:
CIT GROUP INC.
By: /s/ Christopher Grimes
----------------------------------------------------
Name: Christopher Grimes
Title: Senior Vice President and Assistant Treasurer
- ----------
* Confidential Treatment Requested and the Redacted Material has been
separately filed with the Commission.
A-2
SCHEDULE B
TRADE NOTIFICATION
CIT Group Inc.
To: 1211 Avenue of the Americas
New York, NY 10036
From: Goldman, Sachs & Co.
Subject: Issuer VWAP Prepaid Share Forward Transaction
Ref. No: [Insert Reference No.]
Date: [Insert Date]
- --------------------------------------------------------------------------------
The purpose of this Trade Notification is to notify you of certain terms
in the Transaction entered into between Goldman, Sachs & Co. ("GS&Co.") and CIT
Group Inc. ("Counterparty") (together, the "Contracting Parties") on the Trade
Date specified below.
The definitions and provisions contained in the Supplemental Confirmation
specified below are incorporated into this Trade Notification. In the event of
any inconsistency between those definitions and provisions and this Trade
Notification, this Trade Notification will govern.
This Trade Notification supplements, forms part of, and is subject to the
Supplemental Confirmation dated as of July 19, 2005 (the "Supplemental
Confirmation") between the Contracting Parties, as amended and supplemented from
time to time. All provisions contained in the Supplemental Confirmation govern
this Trade Notification.
Trade Date: July 19, 2005
Minimum Shares: [ ]
Maximum Shares: [ ]
Yours sincerely,
GOLDMAN, SACHS & CO.
By:
-------------------------------------
Authorized Signatory
B-1