November 11, 2020
To: Q2 Holdings, Inc.
13785 Research Blvd., Suite 150
Austin, TX 78750
Re: 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 [_______] (Dealer) and Q2 Holdings, Inc., a Delaware 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. Each party further agrees that this Confirmation together with the Agreement evidence a complete binding agreement between Counterparty and Dealer as to the subject matter and terms of the Transaction to which this Confirmation relates, and shall supersede all prior or contemporaneous written or oral communications with respect thereto.
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 Indenture, to be dated November 18, 2020, between Counterparty and Wilmington Trust, National Association, as trustee (the Indenture) governing the 0.125% Convertible Senior Notes due 2025 (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 350,000,000. In the event of any inconsistency between the terms defined in the Indenture and this Confirmation, this Confirmation shall govern. The parties further acknowledge that the Indenture section numbers used herein are based on the draft of the Indenture last reviewed by Dealer and Counterparty as of the date of this Confirmation, and if any such section numbers are changed in the Indenture as executed, the parties will amend this Confirmation in good faith to preserve the intent of the parties. Subject to the foregoing, 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 or supplemented following such date (other than any amendment or supplement pursuant to Section 14.07 of the Indenture, subject to the second paragraph under Method of Adjustment in Section 3), any such amendment or supplement will be disregarded for purposes of this Confirmation (other than as provided in Section 9(i)(iii) below) unless the parties agree otherwise in writing. For the purposes of the Equity Definitions, the Transaction shall be deemed to be a Share Option Transaction.
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 ISDA 2002 Master Agreement (the Agreement) as if Dealer and Counterparty had executed an agreement in such form but without any Schedule except for (a) the election of the laws of the State of New York as the governing law (without reference to choice of law doctrine) and the election of USD as the Termination Currency; and (b) (i) the election that the Cross Default provisions of Section 5(a)(vi) of the Agreement shall apply to Dealer with a Threshold Amount of three percent of Dealers shareholders equity; provided that Specified Indebtedness shall not include obligations in respect of deposits received in the ordinary course of Dealers banking business, (ii) the phrase or becoming capable at such time of being declared shall be