Exhibit 4.1


 


EXECUTION COPY


 




 





ADVANCED MEDICAL OPTICS, INC.,


 


To


 


U.S. BANK NATIONAL ASSOCIATION,




as Trustee










 


INDENTURE


 


Dated as of


 


June 22,
2004










 


2.50% Convertible Senior Subordinated Notes Due 2024




 





 

















 


TABLE OF CONTENTS




	
   

  	
   

  	
   

  	
  PAGE

  
	
  ARTICLE
  1

  DEFINITIONS

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 1.01 

  	
  .

  	
  Definitions

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  2

  
	
  ISSUE,
  DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 2.01

  	
  .

  	
  Designation Amount and
  Issue of Notes

  	
  7

  
	
  Section 2.02

  	
  .

  	
  Form of Notes

  	
  7

  
	
  Section 2.03

  	
  .

  	
  Date and Denomination of
  Notes; Payments of Interest

  	
  7

  
	
  Section 2.04

  	
  .

  	
  Execution of Notes

  	
  8

  
	
  Section 2.05

  	
  .

  	
  Exchange and Registration
  of Transfer of Notes; Restrictions on Transfer

  	
  8

  
	
  Section 2.06

  	
  .

  	
  Mutilated, Destroyed, Lost
  or Stolen Notes

  	
  11

  
	
  Section 2.07

  	
  .

  	
  Temporary Notes

  	
  11

  
	
  Section 2.08

  	
  .

  	
  Cancellation of Notes

  	
  11

  
	
  Section 2.09

  	
  .

  	
  CUSIP Numbers

  	
  11

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  3

  
	
  REDEMPTION
  AND REPURCHASE OF NOTES

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 3.01

  	
  .

  	
  Optional Redemption of
  Notes

  	
  12

  
	
  Section 3.02

  	
  .

  	
  Notice of Optional
  Redemption; Selection of Notes

  	
  12

  
	
  Section 3.03

  	
  .

  	
  Payment of Notes Called for
  Redemption by the Company

  	
  13

  
	
  Section 3.04

  	
  .

  	
  Conversion Arrangement on
  Call for Redemption

  	
  13

  
	
  Section 3.05

  	
  .

  	
  Repurchase at Option of
  Holders Upon a Fundamental Change

  	
  13

  
	
  Section 3.06

  	
  .

  	
  Repurchase of Notes by the
  Company at Option of the Holder

  	
  14

  
	
  Section 3.07

  	
  .

  	
  Company’s Right to Elect
  Manner of Payment of Repurchase Price for Payment

  	
  15

  
	
  Section 3.08

  	
  .

  	
  Effect of Repurchase
  Notice; Withdrawal

  	
  17

  
	
  Section 3.09

  	
  .

  	
  Deposit of Repurchase Price

  	
  18

  
	
  Section 3.10

  	
  .

  	
  Notes Repurchased in Part

  	
  18

  
	
  Section 3.11

  	
  .

  	
  Repayment to the Company

  	
  18

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  4

  
	
  SUBORDINATION
  OF NOTES

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 4.01

  	
  .

  	
  Notes Subordinated To
  Senior Indebtedness

  	
  18

  
	
  Section 4.02

  	
  .

  	
  No Payment On Notes In
  Certain Circumstances

  	
  19

  
	
  Section 4.03

  	
  .

  	
  Payment Over Of Proceeds
  Upon Dissolution, Etc.

  	
  19

  
	
  Section 4.04

  	
  .

  	
  Subrogation

  	
  20

  
	
  Section 4.05

  	
  .

  	
  Obligations Of Company
  Unconditional

  	
  20

  
	
  Section 4.06

  	
  .

  	
  Notice To Trustee

  	
  20

  
	
  Section 4.07

  	
  .

  	
  Trustee’s Relation To
  Senior Indebtedness

  	
  21

  
	
  Section 4.08

  	
  .

  	
  Subordination
  Rights Not Impaired By Acts Or Omissions Of The Company Or Holders Of Senior
  Indebtedness

  	
  21

  
	
  Section 4.09

  	
  .

  	
  Holders Authorize Trustee
  To Effectuate Subordination Of Notes

  	
  21

  
	
  Section 4.10

  	
  .

  	
  This Article Not To
  Prevent Events Of Default

  	
  21

  
	
  Section 4.11

  	
  .

  	
  Trustee’s Compensation And
  Rights To Indemnification Not Prejudiced

  	
  21

  
	
  Section 4.12

  	
  .

  	
  No Waiver Of Subordination
  Provisions

  	
  21

  
	
  Section 4.13

  	
  .

  	
  Subordination
  Provisions Not Applicable To Money Held In Trust For Holders; Payments
  May Be Paid Prior To Dissolution

  	
  21

  
	
  Section 4.14

  	
  .

  	
  Acceleration Of Notes

  	
  22

  
	
  Section 4.15

  	
  .

  	
  Certain Conversions and
  Repurchases Not Deemed Payment

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  5

  
	
  CONTINGENT
  INTEREST

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 5.01

  	
  .

  	
  Contingent Interest

  	
  22

  
	
  Section 5.02

  	
  .

  	
  Payment of Contingent
  Interest

  	
  22

  
	
  Section 5.03

  	
  .

  	
  Contingent Interest
  Notification

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  6

  
	
  PARTICULAR
  COVENANTS OF THE COMPANY

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 6.01

  	
  .

  	
  Payment of Principal,
  Premium and Interest

  	
  22

  
	
  Section 6.02

  	
  .

  	
  Maintenance of Office or
  Agency

  	
  22

  
	
  Section 6.03

  	
  .

  	
  Appointments to Fill
  Vacancies in Trustee’s Office

  	
  23

  
	
  Section 6.04

  	
  .

  	
  Provisions as to Paying
  Agent

  	
  23

  
	
  Section 6.05

  	
  .

  	
  Existence

  	
  23

  
	
  Section 6.06

  	
  .

  	
  Payment of Taxes and Other
  Claims

  	
  23

  
	
  Section 6.07

  	
  .

  	
  Rule 144A Information
  Requirement

  	
  24

  
	
  Section 6.08

  	
  .

  	
  Stay, Extension and Usury
  Laws

  	
  24

  
	
  Section 6.09

  	
  .

  	
  Compliance Certificate

  	
  24

  
	
  Section 6.10

  	
  .

  	
  Additional Interest Notice

  	
  24

  
	
  Section 6.11

  	
  .

  	
  Tax Treatment

  	
  24

  
	
  Section 6.12

  	
  .

  	
  Limitation on Layering

  	
  25

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  7

  
	
  NOTEHOLDERS’
  LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 7.01

  	
  .

  	
  Noteholders’ Lists

  	
  25

  
	
  Section 7.02

  	
  .

  	
  Preservation and Disclosure
  of Lists

  	
  25

  
	
  Section 7.03

  	
  .

  	
  Reports by Trustee

  	
  25

  
	
  Section 7.04

  	
  .

  	
  Reports by Company

  	
  25

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  8

  
	
  REMEDIES
  OF THE TRUSTEE AND NOTEHOLDERS ON AN EVENT OF DEFAULT

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 8.01

  	
  .

  	
  Events of Default

  	
  25

  
	
  Section 8.02

  	
  .

  	
  Payments of Notes on
  Default; Suit Therefor

  	
  27

  
	
  Section 8.03

  	
  .

  	
  Application of Monies
  Collected by Trustee

  	
  27

  
	
  Section 8.04

  	
  .

  	
  Proceedings by Noteholder

  	
  28

  
	
  Section 8.05

  	
  .

  	
  Proceedings by Trustee

  	
  28

  
	
  Section 8.06

  	
  .

  	
  Remedies Cumulative and
  Continuing

  	
  28

  
	
  Section 8.07

  	
  .

  	
  Direction of Proceedings
  and Waiver of Defaults by Majority of Noteholders

  	
  28

  



 

















 


	
  Section 8.08

  	
  . 

  	
  Notice of Defaults

  	
  29

  
	
  Section 8.09

  	
  . 

  	
  Undertaking to Pay Costs

  	
  29

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  9

  
	
  THE
  TRUSTEE

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 9.01

  	
  . 

  	
  Duties and Responsibilities
  of Trustee

  	
  29

  
	
  Section 9.02

  	
  . 

  	
  Reliance on Documents,
  Opinions, etc.

  	
  30

  
	
  Section 9.03

  	
  . 

  	
  No Responsibility for
  Recitals, etc.

  	
  30

  
	
  Section 9.04

  	
  . 

  	
  Trustee, Paying Agents,
  Conversion Agents or Registrar May Own Notes

  	
  30

  
	
  Section 9.05

  	
  . 

  	
  Monies to be Held in Trust

  	
  30

  
	
  Section 9.06

  	
  . 

  	
  Compensation and Expenses
  of Trustee

  	
  30

  
	
  Section 9.07

  	
  . 

  	
  Officers’ Certificate as
  Evidence

  	
  31

  
	
  Section 9.08

  	
  . 

  	
  Conflicting Interests of
  Trustee

  	
  31

  
	
  Section 9.09

  	
  . 

  	
  Eligibility of Trustee

  	
  31

  
	
  Section 9.10

  	
  . 

  	
  Resignation or Removal of
  Trustee

  	
  31

  
	
  Section 9.11

  	
  . 

  	
  Acceptance by Successor
  Trustee

  	
  32

  
	
  Section 9.12

  	
  . 

  	
  Succession by Merger

  	
  32

  
	
  Section 9.13

  	
  . 

  	
  Preferential Collection of
  Claims

  	
  32

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  10

  
	
  THE
  NOTEHOLDERS

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 10.01

  	
  . 

  	
  Action by Noteholders

  	
  33

  
	
  Section 10.02

  	
  . 

  	
  Proof of Execution by
  Noteholders

  	
  33

  
	
  Section 10.03

  	
  . 

  	
  Absolute Owners

  	
  33

  
	
  Section 10.04

  	
  . 

  	
  Company-Owned Notes
  Disregarded

  	
  33

  
	
  Section 10.05

  	
  . 

  	
  Revocation of Consents;
  Future Holders Bound

  	
  33

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  11

  
	
  SUPPLEMENTAL
  INDENTURES

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 11.01

  	
  . 

  	
  Supplemental Indentures
  Without Consent of Noteholders

  	
  33

  
	
  Section 11.02

  	
  . 

  	
  Supplemental Indenture With
  Consent of Noteholders

  	
  34

  
	
  Section 11.03

  	
  . 

  	
  Effect of Supplemental
  Indenture

  	
  35

  
	
  Section 11.04

  	
  . 

  	
  Notation on Notes

  	
  35

  
	
  Section 11.05

  	
  . 

  	
  Evidence of Compliance of
  Supplemental Indenture to be Furnished to Trustee

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  12

  
	
  CONSOLIDATION,
  MERGER, SALE, CONVEYANCE AND LEASE

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 12.01

  	
  . 

  	
  Company
  May Consolidate on Certain Terms

  	
  35

  
	
  Section 12.02

  	
  . 

  	
  Successor to be Substituted

  	
  36

  
	
  Section 12.03

  	
  . 

  	
  Opinion of Counsel to be
  Given Trustee

  	
  36

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  13

  
	
  SATISFACTION
  AND DISCHARGE OF INDENTURE

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 13.01

  	
  . 

  	
  Discharge of Indenture

  	
  36

  
	
  Section 13.02

  	
  . 

  	
  Deposited Monies to be Held
  in Trust by Trustee

  	
  36

  
	
  Section 13.03

  	
  . 

  	
  Paying Agent to Repay
  Monies Held

  	
  37

  
	
  Section 13.04

  	
  . 

  	
  Return of Unclaimed Monies

  	
  37

  
	
  Section 13.05

  	
  . 

  	
  Reinstatement

  	
  37

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  14

  
	
  IMMUNITY
  OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 14.01

  	
  . 

  	
  Indenture and Notes Solely
  Corporate Obligations

  	
  37

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  15

  
	
  CONVERSION
  OF NOTES

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 15.01

  	
  . 

  	
  Right to Convert

  	
  37

  
	
  Section 15.02

  	
  . 

  	
  Exercise
  of Conversion Right; Issuance of Common Stock on Conversion; No Adjustment
  for Interest or Dividends

  	
  39

  
	
  Section 15.03

  	
  . 

  	
  Cash Payments in Lieu of
  Fractional Shares

  	
  40

  
	
  Section 15.04

  	
  . 

  	
  Conversion Rate

  	
  40

  
	
  Section 15.05

  	
  . 

  	
  Adjustment of Conversion
  Rate

  	
  40

  
	
  Section 15.06

  	
  . 

  	
  Effect of
  Reclassification, Consolidation, Merger or Sale

  	
  44

  
	
  Section 15.07

  	
  . 

  	
  Taxes on Shares Issued

  	
  45

  
	
  Section 15.08

  	
  . 

  	
  Reservation
  of Shares, Shares to be Fully Paid; Compliance with Governmental Requirements;
  Listing of Common Stock

  	
  45

  
	
  Section 15.09

  	
  . 

  	
  Responsibility of Trustee

  	
  45

  
	
  Section 15.10

  	
  . 

  	
  Notice to Holders Prior to
  Certain Actions

  	
  45

  
	
  Section 15.11

  	
  . 

  	
  Stockholder Rights Plans

  	
  46

  
	
  Section 15.12

  	
  . 

  	
  Option to Satisfy
  Conversion Obligation with Cash, Common Stock or Combination Thereof

  	
  46

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  16

  
	
  MAKE
  WHOLE PREMIUM

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 16.01

  	
  . 

  	
  Make Whole Premium

  	
  47

  
	
  Section 16.02

  	
  . 

  	
  Adjustments Relating To
  Make Whole Premium

  	
  48

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  17

  
	
  MISCELLANEOUS
  PROVISIONS

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 17.01

  	
  . 

  	
  Provisions Binding on
  Company’s Successors

  	
  48

  
	
  Section 17.02

  	
  . 

  	
  Official Acts by Successor
  Corporation

  	
  49

  
	
  Section 17.03

  	
  . 

  	
  Addresses for Notices, etc.

  	
  49

  
	
  Section 17.04

  	
  . 

  	
  Governing Law

  	
  49

  
	
  Section 17.05

  	
  . 

  	
  Evidence of Compliance with
  Conditions Precedent, Certificates to Trustee

  	
  49

  
	
  Section 17.06

  	
  . 

  	
  Legal Holidays

  	
  49

  
	
  Section 17.07

  	
  . 

  	
  Trust Indenture Act

  	
  49

  
	
  Section 17.08

  	
  . 

  	
  No Security Interest
  Created

  	
  49

  
	
  Section 17.09

  	
  . 

  	
  Benefits of Indenture

  	
  49

  
	
  Section 17.10

  	
  . 

  	
  Table of Contents,
  Headings, etc.

  	
  49

  
	
  Section 17.11

  	
  . 

  	
  Authenticating Agent

  	
  50

  
	
  Section 17.12

  	
  . 

  	
  Execution in Counterparts

  	
  50

  
	
  Section 17.13

  	
  . 

  	
  Severability

  	
  50

  



 

















 


	
  Exhibit A

  	
   

  	
  Form of Note

  	
  A-1

  
	
  Exhibit B

  	
   

  	
  Form of Restrictive
  Legend for Common Stock Issued Upon Conversion

  	
  B-1

  



 






 


 


 


 












 


INDENTURE


 


INDENTURE dated as of June 22,
2004 between Advanced Medical Optics, Inc., a Delaware corporation
(hereinafter called the “Company”), having its principal office at 1700 E. St.
Andrew Place, Santa Ana, California 92705, and U.S. Bank National Association,
a national banking association duly organized and existing under the laws of
the United States, as trustee hereunder (hereinafter called the “Trustee”).


WITNESSETH:


 


WHEREAS, for its lawful
corporate purposes, the Company has duly authorized the issue of its 2.50%
Convertible Senior Subordinated Notes Due 2024 (hereinafter called the “Notes”),
in an aggregate principal amount not to exceed $350,000,000 and, to provide the
terms and conditions upon which the Notes are to be authenticated, issued and
delivered, the Company has duly authorized the execution and delivery of this
Indenture; and


 


WHEREAS, the Notes, the
certificate of authentication to be borne by the Notes, a form of assignment, a
form of option to elect repurchase upon a Fundamental Change (as defined
below), a form of repurchase notice and a form of conversion notice to be borne
by the Notes are to be substantially in the forms hereinafter provided for; and


 


WHEREAS, all acts and things
necessary to make the Notes, when executed by the Company and authenticated and
delivered by the Trustee or a duly authorized authenticating agent, as in this
Indenture provided, the valid, binding and legal obligations of the Company,
and to constitute this Indenture a valid agreement according to its terms, have
been done and performed, and the execution of this Indenture and the issue
hereunder of the Notes have in all respects been duly authorized,


 


NOW, THEREFORE, THIS INDENTURE WITNESSETH:


 


That in order to declare the
terms and conditions upon which the Notes are, and are to be, authenticated,
issued and delivered, and in consideration of the premises and of the purchase
and acceptance of the Notes by the holders thereof, the Company covenants and
agrees with the Trustee for the equal and proportionate benefit of the
respective holders from time to time of the Notes (except as otherwise provided
below), as follows:


ARTICLE 1

DEFINITIONS


 


Section 1.01.
Definitions. The terms defined in this Section 1.01 (except as herein
otherwise expressly provided or unless the context otherwise requires) for all
purposes of this Indenture and of any indenture supplemental hereto shall have
the respective meanings specified in this Section 1.01. All other terms
used in this Indenture that are defined in the Trust Indenture Act or which are
by reference therein defined in the Securities Act (except as herein otherwise
expressly provided or unless the context otherwise requires) shall have the
respective meanings assigned to such terms in the Trust Indenture Act and in
the Securities Act as in force at the date of the execution of this Indenture.
The words “herein”, “hereof”, “hereunder” and words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or
other Subdivision. The terms defined in this Article include the plural as
well as the singular.


 


“Additional Interest” has
the meaning specified for Additional Interest Amount in Section 2(e) of
the Registration Rights Agreement.


 


“Additional Interest Notice”
has the meaning specified in Section 6.10.


 


“Adjustment Event” has the
meaning specified in Section 15.05(k).


 


“Affiliate” of any specified
Person means any other Person directly or indirectly controlling or controlled
by or under direct or indirect common control with such specified Person. For
the purposes of this definition, “control”, when used with respect to any
specified Person means the power to direct or cause the direction of the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise, and the terms “controlling”
and “controlled” have meanings correlative to the foregoing.


 


“Agent Members” has the
meaning specified in Section 2.05(b).


 


“Applicable Stock” means in
the event of a Fundamental Change, the common stock, ordinary shares or
American Depositary Shares of such surviving corporation or its direct or
indirect, as applicable, parent corporation.


 


“Applicable Stock Price”
means, in respect of a Conversion Date, the average of the Closing Sale Price
of a share of Common Stock over the Cash Settlement Averaging Period.


 


“Board of Directors” means
the Board of Directors of the Company or a committee of such Board duly
authorized to act for it hereunder.


 


“Business Day” means any day
except a Saturday, Sunday or legal holiday on which banking institutions in The
City of New York are authorized or obligated by law, regulation or executive
order to close.


 


“Calculation Agent” has the
meaning specified in Section 16.01(e).


 

















 


“Cash Amount” has the
meaning specified in Section 15.12(a)(iii).


 


“Cash Settlement Averaging
Period” means the twenty Trading-Day period (a) ending on the second
Trading Day immediately preceding the redemption date, if the Company has
called the Notes for redemption pursuant to Section 3.02, (b) ending
on the second Trading Day immediately preceding the Maturity Date, with respect
to a Conversion Notice received during the period beginning twenty-five Trading
Days immediately preceding the Maturity Date and ending one Trading Day
immediately preceding the Maturity Date (regardless of whether the Company has
irrevocably elected to make a cash payment of principal upon conversion
pursuant to Section 15.12(b)), (c) beginning on the Trading Day
immediately following the Company’s receipt of a holder’s Conversion Notice, if
the Company has irrevocably elected to make a cash payment of principal upon
conversion pursuant to Section 15.12(b); provided, however, that if the
Company has irrevocably elected to make a cash payment of principal upon
conversion and the holder submits a Conversion Notice during the period
beginning twenty-five Trading Days immediately preceding the Maturity Date and
ending one Trading Day immediately preceding the Maturity Date, the Cash
Settlement Averaging Period shall end on the second Trading Day immediately
preceding the Maturity Date and (d) beginning on the Trading Day
immediately following the final Trading Day of the Conversion Retraction
Period, in all other cases.


 


“Closing Sale Price” of any
share of Common Stock or Applicable Stock or any other security on any Trading
Date means the closing sale price of such security (or, if no closing sale
price is reported, the average of the closing bid and ask prices or, if more
than one in either case, the average of the average closing bid and the average
closing ask prices) on such date as reported in composite transactions for the
principal United States securities exchange on which the shares of Common Stock
are traded or, if the shares of Common Stock are not listed on a United States
national or regional securities exchange, as reported by the Nasdaq System or
by the National Quotation Bureau Incorporated. In the absence of such a
quotation, the Company shall be entitled to determine the Closing Sale Price on
the basis it considers appropriate. The Closing Sale Price shall be determined
without reference to extended or after hours trading.


 


“Commission” means the
Securities and Exchange Commission, as from time to time constituted, created
under the Exchange Act, or, if at any time after the execution of this
Indenture such Commission is not existing and performing the duties now
assigned to it under the Trust Indenture Act, then the body performing such
duties at such time.


 


“Common Stock” means any
stock of any class of the Company which has no preference in respect of
dividends or of amounts payable in the event of any voluntary or involuntary
liquidation, dissolution or winding up of the Company and which is not subject
to redemption by the Company. Subject to the provisions of Section 15.06,
however, shares issuable on conversion of Notes shall include only shares of
the class designated as common stock of the Company at the date of this
Indenture (namely, the Common Stock, par value $.01) or shares of any class or
classes resulting from any reclassification or reclassifications thereof and
which have no preference in respect of dividends or of amounts payable in the
event of any voluntary or involuntary liquidation, dissolution or winding up of
the Company and which are not subject to redemption by the Company; provided
that if at any time there shall be more than one such resulting class, the
shares of each such class then so issuable on conversion shall be substantially
in the proportion which the total number of shares of such class resulting from
all such reclassifications bears to the total number of shares of all such
classes resulting from all such reclassifications.


 


“Company” means the
corporation named as the “Company” in the first paragraph of this Indenture,
and, subject to the provisions of Article 12 and Section 15.06, shall
include its successors and assigns.


 


“Company Repurchase Notice”
has the meaning specified in Section 3.07(d).


 


“Company Repurchase Notice
Date” has the meaning specified in Section 3.07(b).


 


“contingent interest” means
interest that accrues and is payable as provided in Article 5.


 


“Conversion Date” has the
meaning specified in Section 15.02.


 


“Conversion Notice” has the
meaning specified in Section 15.02.


 


“Conversion Obligation” has
the meaning specified in Section 15.12(a).


 


“Conversion Price” on any
date of determination means $1,000 divided by the Conversion Rate as of such
date.


 


“Conversion Rate” has the
meaning specified in Section 15.04.


 


“Conversion Retraction
Period” has the meaning specified in Section 15.12(a).


 


“Corporate Trust Office” or
other similar term, means the designated office of the Trustee at which at any
particular time its corporate trust business as it relates to this Indenture
shall be administered, which office is, at the date as of which this Indenture
is dated, located at U.S. Bank National Association, 60 Livingston Avenue, St.
Paul, Minnesota 55107-2292, Attention:

Corporate Trust Office or at any other time at such other address as the
Trustee may designate from time to time by notice to the Company.


 


“Current Market Price” has
the meaning specified in Section 15.05(g)(i).


 


2

















 


“Custodian” means U.S. Bank
National Association, as custodian with respect to the Notes in global form, or
any successor entity thereto.


 


“default” means any event
that is, or after notice or passage of time, or both, would be, an Event of
Default.


 


“Defaulted Interest” has the
meaning specified in Section 2.03.


 


“Depositary” means the
clearing agency registered under the Exchange Act that is designated to act as
the Depositary for the Global Notes. DTC shall be the initial Depositary, until
a successor shall have been appointed and become such pursuant to the applicable
provisions of this Indenture, and thereafter, “Depositary” shall mean or
include such successor.


 


“Designated Senior
Indebtedness” means Indebtedness outstanding under the Senior Credit Facility
and any other Senior Indebtedness of the Company that at the date of
determination has an aggregate principal amount outstanding of at least $25.0
million if the instrument governing such Senior Indebtedness expressly states
that such Indebtedness is “Designated Senior Indebtedness” for purposes of this
Indenture.


 


“Determination Date” has the
meaning specified in Section 15.05(k).


 


“DTC” means The Depository
Trust Company.


 


“Effective Date” has the
meaning specified in Section 16.01(c).


 


“Event of Default” means any
event specified in Section 8.01 as an Event of Default.


 


“Exchange Act” means the
Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder, as in 


effect from time to time.


 


“Ex-Dividend Time” has the
meaning specified in Section 15.01(b).


 


“Expiration Time” has the
meaning specified in Section 15.05(f).


 


“Fair Market Value” has the
meaning specified in Section 15.05(g)(ii).


 


“Fiscal Quarter” means, with
respect to the Company, the fiscal quarter publicly disclosed by the Company.
The Company shall confirm the ending dates of its fiscal quarters for the
current fiscal year to the Trustee upon the Trustee’s request.


 


“Fundamental Change” means
any transaction or event (whether by means of an exchange offer, liquidation,
tender offer, consolidation, merger, combination, reclassification,
recapitalization or otherwise) in connection with which all or substantially
all of the Common Stock is exchanged for, converted into, acquired for or
constitutes solely the right to receive, consideration which is not all or substantially
all common stock that is: (a) listed on, or immediately after such
transaction or event, will be listed on, a United States national securities
exchange or (b) approved, or immediately after such transaction or event
will be approved, for quotation on the Nasdaq National Market or any similar
United States system of automated dissemination of quotations of securities
prices.


 


“Fundamental Change
Repurchase Date” has the meaning specified in Section 3.05(a).


 


“Global Note” has the
meaning specified in Section 2.02.


 


“Indebtedness” means, with
respect to any Person, and without duplication, whether recourse is to all or a
portion of the assets of such Person and whether or not contingent, (a) all
indebtedness, obligations and other liabilities of such Person for borrowed
money (including obligations of the Person in respect of overdrafts, foreign
exchange contracts, currency exchange agreements, interest rate protection
agreements, and any loans or advances from banks, whether or not evidenced by notes
or similar instruments) or evidenced by bonds, debentures, notes or similar
instruments, other than any account payable or other accrued current liability
or obligation incurred in the ordinary course of business in connection with
the obtaining of materials or services; (b) all reimbursement obligations
and other liabilities of such Person with respect to letters of credit, bank
guarantees or bankers’ acceptances; (c) all obligations and liabilities in
respect of leases of such Person required, in conformity with generally
accepted accounting principles, to be accounted for as capitalized lease
obligations on the balance sheet of such Person and all obligations and other
liabilities under any lease or related document (including a purchase
agreement) in connection with the lease of real property which provides that
such Person is contractually obligated to purchase or cause a third party to
purchase the leased property and thereby guarantee a minimum residual value of
the leased property to the lessor and the obligations of such Person under such
lease or related document to purchase or to cause a third party to purchase
such leased property; (d) all net obligations of such Person with respect
to an interest rate or other swap, cap or collar agreement or other similar
instrument or agreement or foreign currency hedge, exchange, purchase or
similar instrument or agreement; (e) all direct or indirect guaranties or
similar agreements by such Person in respect of, and obligations or liabilities
of such Person to purchase or otherwise acquire or otherwise assure a creditor
against loss in respect of, indebtedness, obligations or liabilities of another
Person of the kind described in clauses (a) through (d); (f) any
indebtedness or other obligations described in clauses (a) through (e) secured
by any mortgage, pledge, lien or other encumbrance existing on property which
is owned or held by such Person, regardless of whether the indebtedness or
other obligation 


 


3

















 


secured thereby shall have
been assumed by such Person; and (g) any and all deferrals, renewals,
extensions and refundings of, or amendments, modifications or supplements to,
any indebtedness, obligation or liability of the kind described in clauses (a) through
(f).


 


“Indenture” means this
instrument as originally executed or, if amended or supplemented as herein
provided, as so amended or supplemented.


 


“Initial Purchasers” means
each of Lehman Brothers Inc., Morgan Stanley & Co. Incorporated and
Banc of America Securities LLC (each, an “Initial Purchaser”).


 


“interest” means, when used
with reference to the Notes, any interest payable under the terms of the Notes,
including contingent interest, if any, and Additional Interest, if any, payable
under the terms of the Registration Rights Agreement.


 


“Junior Securities” has the
meaning specified in Section 4.15.


 


“Make Whole Percentage” has
the meaning specified in Section 16.01(c)(iii).


 


“Make Whole Premium” has the
meaning specified in Section 16.01(b).


 


“Make Whole Table” has the
meaning specified in Section 16.01(c)(iii).


 


“Maturity Date” means July 15,
2024.


 


“Moody’s” has the meaning
specified in Section 15.01(a)(v).


 


“non-electing share” has the
meaning specified in Section 15.06.


 


“Note” or “Notes” means any
Note or Notes, as the case may be, authenticated and delivered under this
Indenture, including any Global Note.


 


“Note Register” has the
meaning specified in Section 2.05(a).


 


“Note Registrar” has the
meaning specified in Section 2.05(a).


 


“Noteholder” or “holder” as
applied to any Note, or other similar terms (but excluding the term “beneficial
holder”), means any Person in whose name at the time a particular Note is
registered on the Note Registrar’s books.


 


“Obligations” means any
principal, interest (including, in the case of Senior Indebtedness,
Post-Petition Interest), penalties, fees, indemnifications, reimbursement
obligations, damages and other liabilities payable under the documentation
governing any Indebtedness.


 


“Officer” means any person holding
any of the following positions with the Company: the Chairman of the Board, any
Vice Chairman, the Chief Executive Officer, the President, any Vice President
(whether or not designated by a number or numbers or word or words added before
or after the title “Vice President”), the Chief Financial Officer, the
Treasurer and the Secretary.


 


“Officers’ Certificate”,
when used with respect to the Company, means a certificate signed by any two
Officers or by one such Officer and any Assistant Treasurer or Assistant
Secretary of the Company.


 


“Opinion of Counsel” means
an opinion in writing signed by legal counsel, who may be an employee of or
counsel to the Company, or other counsel reasonably acceptable to the Trustee.


 


“outstanding”, when used
with reference to Notes and subject to the provisions of Section 10.04,
means, as of any particular time, all Notes authenticated and delivered by the
Trustee under this Indenture, except:


 


(a) Notes theretofore
canceled by the Trustee or delivered to the Trustee for cancellation;


 


(b) Notes, or portions
thereof, (i) for the redemption or repurchase of which monies in the
necessary amount shall have been deposited in trust with the Trustee or with
any Paying Agent (other than the Company) or (ii) which shall have been otherwise
discharged in accordance with Article 13;


 


(c) Notes in lieu of
which, or in substitution for which, other Notes shall have been authenticated
and delivered pursuant to the terms of Section 2.06; and


 


(d) Notes converted
into Common Stock pursuant to Article 15 and Notes paid or redeemed or
repurchased pursuant to Article 3.


 


“Paying Agent” has the
meaning specified in Section 2.08.


 


“Payment Blockage Notice”
has the meaning specified in Section 4.02(a).


 


4

















 


“Payment Blockage Period”
has the meaning specified in Section 4.02(a).


 


“Person” means a
corporation, an association, a partnership, a limited liability company, an
individual, a joint venture, a joint stock company, a trust, an unincorporated
organization or a government or an agency or a political subdivision thereof.


 


“PORTAL Market” means The
PORTAL Market operated by the Nasdaq Stock Market or any successor thereto.


 


“Post-Petition Interest”
means, with respect to any Indebtedness of any Person, all interest accrued or
accruing on such Indebtedness after the commencement of any insolvency or
liquidation proceeding against such Person in accordance with and at the
contract rate (including, without limitation, any rate applicable upon default),
specified in the agreement or instrument creating, evidencing or governing such
Indebtedness, whether or not, pursuant to applicable law or otherwise, the
claim for such interest is allowed as a claim in such insolvency or liquidation
proceeding.


 


“Predecessor Note” of any
particular Note means every previous Note evidencing all or a portion of the
same debt as that evidenced by such particular Note, and, for the purposes of
this definition, any Note authenticated and delivered under Section 2.06
in lieu of a lost, destroyed or stolen Note shall be deemed to evidence the
same debt as the lost, destroyed or stolen Note that it replaces.


 


“premium” means any premium
payable under the terms of the Notes.


 


“Purchased Shares” has the
meaning specified in Section 15.05(f).


 


“record date” has the
meaning specified in Section 15.05(g)(iii).


 


“Record Date” has the
meaning specified in Section 2.03.


 


“Registration Rights
Agreement” means the Registration Rights Agreement, dated as of June 22,
2004, between the Company and the Initial Purchasers, as amended from time to
time in accordance with its terms.


 


“representative” means (a) the
indenture trustee or other trustee, agent or representative for holders of
Senior Indebtedness or (b) with respect to any Senior Indebtedness that
does not have any such trustee, agent or other representative, (i) in the
case of such Senior Indebtedness issued pursuant to an agreement providing for
voting arrangements as among the holders or owners of such Senior Indebtedness,
any holder or owner of such Senior Indebtedness acting with the consent of the
required persons necessary to bind such holders or owners of such Senior
Indebtedness and (ii) in the case of all other such Senior Indebtedness,
the holder or owner of such Senior Indebtedness.


 


“Repurchase Date” has the
meaning specified in Section 3.06(a).


 


“Repurchase Notice” has the
meaning specified in Section 3.05(c).


 


“Responsible Officer” shall
mean, when used with respect to the Trustee, any officer within the corporate
trust department of the Trustee with direct responsibility for the
administration of this Indenture and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of such person’s knowledge of or familiarity with the particular
subject.


 


“Restricted Securities” has
the meaning specified in Section 2.05(c).


 


“Rule 144A” means Rule 144A
as promulgated under the Securities Act as it may be amended from time to time
hereafter.


 


“S&P” has the meaning
specified in Section 15.01(a)(v).


 


“Securities” has the meaning
specified in Section 15.05(d).


 


“Securities Act” means the
Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder, as in effect from time to time.


 


“Senior Credit Facility”
means the senior credit facility, under the $100,000,000 Amended and Restated
Credit Agreement dated as of June 17, 2003, as amended, among Advanced
Medical Optics, Inc., as Borrower, General Electric Capital Corporation,
as syndication agent, Bank One, N.A., as documentation agent, and Bank of
America, N.A., as administrative agent, foreign currency fronting lender and
L/C issuer and the other financial institutions from time to time party
thereto, together with the documents now or hereafter related thereto
(including, without limitation, any guarantee agreements and any security
documents executed in connection therewith), in each case as such agreements
may be amended (including any amendment and restatement thereof), supplemented
or otherwise modified from time to time, including any deferral thereof or any
agreement extending the maturity of, refinancing, replacing or otherwise
restructuring (including by way of increasing the amount of commitments
thereunder and adding the Company or any Subsidiaries of the Company as
additional borrowers or guarantors thereunder) all or any portion of the
Indebtedness under such agreement or any successor or replacement agreement and
whether by the same or any other agent, lender or group of lenders (or other institutions).


 


5

















 


“Senior Indebtedness” means,
with respect to any Person, whether outstanding on the date of this Indenture
or thereafter issued, all Obligations of such Person under the Senior Credit
Facility, hedging obligations of such Person and any other Indebtedness of such
Person unless the instrument creating or evidencing such Indebtedness expressly
provides that such Indebtedness is not senior or superior in right of payment
to the Notes, including other obligations, such as fees, expenses,
reimbursement obligations arising from letters of credit, indemnities and other
obligations specified in the documents governing such Senior Indebtedness, all
renewals, extensions, modifications, amendments or refinancings thereof;
provided, that in no event shall Senior Indebtedness include (a) to the
extent that it may constitute Indebtedness, any Obligation for federal, state,
local or other taxes; (b) any Indebtedness among or between the Company
and any Subsidiary, unless and for so long as such Indebtedness has been
pledged to secure Obligations to a third party; (c) to the extent that it
may constitute Indebtedness, any Obligation in respect of any trade payable
incurred for the purchase of goods or materials, or for services obtained in
the ordinary course of business; (d) Indebtedness evidenced by the Notes; (e) Indebtedness
that is expressly subordinate or junior in right of payment to any other
Indebtedness; provided that for the avoidance of doubt, Indebtedness under the
Senior Credit Facility shall not be deemed expressly subordinate or junior to
liens of Indebtedness permitted under the Senior Credit Facility simply by
reason of the fact that such liens or Indebtedness are permitted under the
Senior Credit Facility; (f) to the extent that it may constitute
Indebtedness, any Obligation owing under leases (other than capital lease
obligations) or management agreements; and (g) any Obligation that by
operation of law is subordinate to any general unsecured Obligations.


 


“Settlement Notice Period”
has the meaning specified in Section 15.12(a).


 


“Significant Subsidiary”
means, as of any date of determination, a Subsidiary of the Company that would
constitute a “significant subsidiary” as such term is defined under Rule 1-02(w) of
Regulation S-X of the Commission as in effect on the date of this Indenture.


 


“Stock Price” has the
meaning specified in Section 16.01(c).


 


“Stock Price Cap” has the
meaning specified in Section 16.01(b)(iii).


 


“Stock Price Threshold” has the
meaning specified in Section 16.01(b)(ii).


 


“Subsidiary” means, with
respect to any Person, (i) any corporation, association or other business
entity of which more than 50% of the total voting power of shares of capital
stock or other equity interest entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other subsidiaries of that Person (or a
combination thereof) and (ii) any partnership (a) the sole general
partner or managing general partner of which is such Person or a subsidiary of
such Person or (b) the only general partners of which are such Person or
of one or more subsidiaries of such Person (or any combination thereof).


 


“Tax Original Issue Discount”
means the amount of ordinary interest income on a Note that must be accrued as
original issue discount for United States Federal income tax purposes pursuant
to U.S. Treasury Regulation section 1.1275-4.


 


“Trading Day” has the
meaning specified in Section 15.05(g)(iv).


 


“Trading Price” means, with
respect to a Note on any date of determination, the average of the secondary
market bid quotations per $1,000 principal amount of Notes obtained by the
Trustee for $10,000,000 principal amount of Notes at approximately 3:30 p.m.,
New York City time, on such determination date from three independent
nationally recognized securities dealers selected by the Company; provided that
if three such bids cannot reasonably be obtained by the Trustee, but two such
bids are obtained, then the average of the two bids shall be used, and if only
one such bid can reasonably be obtained by the Trustee, this one bid shall be
used; and provided further that, if the Trustee cannot reasonably obtain at
least one bid for $10,000,000 principal amount of Notes from a nationally
recognized securities dealer, then the Trading Price per $1,000 principal
amount of Notes shall be deemed to be less than 95% of the product of (a) the
Conversion Rate on such determination date and (b) the Closing Sale Price
of a share of Common Stock on such determination date; provided, however, that
for purposes of determining the “Trading Price” as used in Article 5 only,
if the Trustee cannot reasonably obtain at least one bid for $10,000,000
principal amount of the Notes from a nationally recognized securities dealer,
then the Trading Price of a Note will be deemed to equal the product of (1) the
Conversion Rate on such determination date and (2) the average Closing
Sale Price of a share of Common Stock over the five Trading- Day period ending
on such determination date.


 


“Trigger Event” has the
meaning specified in Section 15.05(d).


 


“Trust Indenture Act” means
the Trust Indenture Act of 1939, as amended, as it was in force at the date of
this Indenture, except as provided in Section 12.03; provided that if the
Trust Indenture Act of 1939 is amended after the date hereof, the term “Trust
Indenture Act” shall mean, to the extent required by such amendment, the Trust
Indenture Act of 1939 as so amended.


 


“Trustee” means U.S. Bank
National Association and its successors and any corporation resulting from or
surviving any consolidation or merger to which it or its successors may be a
party and any successor trustee at the time serving as successor trustee
hereunder.


 


6

















 


ARTICLE 2

ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES


 


Section 2.01 .
Designation Amount and Issue of Notes. The Notes shall be designated as “2.50%
Convertible Senior Subordinated Notes Due 2024”. Notes not to exceed the
aggregate principal amount of $350,000,000 (except pursuant to Sections 2.05,
2.06, 3.03, 3.05, 3.06 and 15.02 hereof) upon the execution of this Indenture,
or from time to time thereafter, may be executed by the Company and delivered
to the Trustee for authentication, and the Trustee shall thereupon authenticate
and deliver Notes upon a written order of the Company, such order signed by an Officer
or by any Assistant Treasurer of the Company or any Assistant Secretary of the
Company, without any further action by the Company hereunder.


 


Section 2.02 . Form of
Notes. The Notes and the Trustee’s certificate of authentication to be borne by
such Notes shall be substantially in the form set forth in Exhibit A
hereto. The terms and provisions contained in the form of Note attached as Exhibit A
hereto shall constitute, and are hereby expressly made, a part of this
Indenture and, to the extent applicable, the Company and the Trustee, by their
execution and delivery of this Indenture, expressly agree to such terms and
provisions and to be bound thereby.


 


Any of the Notes may have
such letters, numbers or other marks of identification and such notations,
legends, endorsements or changes as the officers executing the same may approve
(execution thereof to be conclusive evidence of such approval) and as are not
inconsistent with the provisions of this Indenture, or as may be required by
the Custodian, the Depositary or by the National Association of Securities
Dealers, Inc. in order for the Notes to be tradable on The PORTAL Market
or as may be required for the Notes to be tradable on any other market
developed for trading of securities pursuant to Rule 144A or as may be
required to comply with any applicable law or with any rule or regulation
made pursuant thereto or with any rule or regulation of any securities
exchange or automated quotation system on which the Notes may be listed, or to
conform to usage, or to indicate any special limitations or restrictions to
which any particular Notes are subject.


 


So long as the Notes are
eligible for book-entry settlement with the Depositary, or unless otherwise
required by law, or otherwise contemplated by Section 2.05(b), all of the
Notes will be represented by one or more Notes in global form registered in the
name of the Depositary or the nominee of the Depositary (a “Global Note”). The
transfer and exchange of beneficial interests in any such Global Note shall be effected
through the Depositary in accordance with this Indenture and the applicable
procedures of the Depositary. Except as provided in Section 2.05(b),
beneficial owners of a Global Note shall not be entitled to have certificates
registered in their names, will not receive or be entitled to receive physical
delivery of certificates in definitive form and will not be considered holders
of such Global Note.


 


Any Global Note shall
represent such of the outstanding Notes as shall be specified therein and shall
provide that it shall represent the aggregate amount of outstanding Notes from
time to time endorsed thereon and that the aggregate amount of outstanding
Notes represented thereby may from time to time be increased or reduced to
reflect redemptions, repurchases, conversions, transfers or exchanges permitted
hereby. Any endorsement of a Global Note to reflect the amount of any increase
or decrease in the amount of outstanding Notes represented thereby shall be
made by the Trustee or the Custodian, at the direction of the Trustee, in such
manner and upon instructions given by the holder of such Notes in accordance
with this Indenture. Payment of principal of, interest on and premium, if any,
on any Global Note shall be made to the holder of such Note.


 


Section 2.03 . Date and
Denomination of Notes; Payments of Interest. The Notes shall be issuable in
registered form without coupons in denominations of $1,000 principal amount and
integral multiples thereof. Each Note shall be dated the date of its
authentication and shall bear interest from the date specified on the face of
the form of Note attached as Exhibit A hereto. Interest on the Notes shall
be computed on the basis of a 360-day year comprised of twelve 30-day months.


 


The Person in whose name any
Note (or its Predecessor Note) is registered on the Note Register at 5:00 p.m.,
New York City time, on any Record Date with respect to any interest payment
date shall be entitled to receive the interest payable on such interest payment
date, except that the interest payable upon maturity, redemption or repurchase
following a Fundamental Change will be payable to the Person to whom principal
is payable upon maturity or pursuant to such redemption or repurchase following
a Fundamental Change (unless the redemption date or the Fundamental Change
Repurchase Date, as the case may be, is after a Record Date and on or prior to
the corresponding interest payment date, in which case the semi-annual payment
of interest becoming due on such interest payment date shall be payable to the
holder of such Note registered as such on the applicable Record Date).
Notwithstanding the foregoing, any Note or portion thereof surrendered for
conversion during the period from 5:00 p.m., New York City time, on the
Record Date for any interest payment date to 5:00 p.m., New York City
time, on the Business Day preceding the applicable interest payment date shall
be accompanied by payment, in immediately available funds or other funds
acceptable to the Company, of an amount equal to the interest otherwise payable
on such interest payment date on the principal amount being converted; provided
that no such payment need be made (1) if a holder converts its Notes in
connection with a redemption and the Company has specified a redemption date
that is after a Record Date and on or prior to the next interest payment date, (2) if
a holder converts its Notes in connection with a Fundamental Change and the
Company has specified a Fundamental Change Repurchase Date that is after a
Record Date and on or prior to the next interest payment date or (3) to
the extent of any overdue interest, if any exists at the time of conversion
with respect to such Note. Interest shall be payable at the office of the
Company maintained by the Company for such purposes in the Borough of
Manhattan, The City of New York, which shall initially be an office or agency
of the Trustee. The Company shall pay interest (i) on any Notes in
certificated form by check mailed to the address of the Person entitled thereto
as it appears in the Note Register or (ii) on any Global Note by wire
transfer of immediately available funds to the account of the Depositary or its
nominee. If a payment date is not a Business Day, payment shall be made on the
next succeeding Business Day, and no additional interest shall accrue thereon.
The term “Record Date” with respect to any interest payment date shall mean the
January 1 or July 1 preceding the applicable January 15 or July 15
interest payment date, respectively.


 


7

















 


Any interest on any Note
which is payable, but is not punctually paid or duly provided for, on any January 15
or July 15 (herein called “Defaulted Interest”) shall forthwith cease to
be payable to the Noteholder registered as such on the relevant Record Date,
and such Defaulted Interest shall be paid by the Company, at its election in
each case, as provided in clause (1) or (2) below:


 


(1) The Company may
elect to make payment of any Defaulted Interest to the Persons in whose names
the Notes (or their respective Predecessor Notes) are registered at 5:00 p.m.,
New York City time, on a special record date for the payment of such Defaulted
Interest, which shall be fixed in the following manner. The Company shall
notify the Trustee in writing of the amount of Defaulted Interest proposed to
be paid on each Note and the date of the proposed payment (which shall be not
less than twenty-five calendar days after the receipt by the Trustee of such
notice, unless the Trustee shall consent to an earlier date), and at the same
time the Company shall deposit with the Trustee an amount of money equal to the
aggregate amount to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit on or prior to the date
of the proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this clause
provided. Thereupon the Trustee shall fix a special record date for the payment
of such Defaulted Interest which shall be not more than fifteen calendar days
and not less than ten calendar days prior to the date of the proposed payment,
and not less than ten calendar days after the receipt by the Trustee of the
notice of the proposed payment (unless, the Trustee shall consent to an earlier
date). The Trustee shall promptly notify the Company of such special record
date and, in the name and at the expense of the Company, shall cause notice of
the proposed payment of such Defaulted Interest and the special record date
therefor to be mailed, first-class postage prepaid, to each holder at his
address as it appears in the Note Register, not less than ten calendar days
prior to such special record date (unless, the Trustee shall consent to an
earlier date). Notice of the proposed payment of such Defaulted Interest and
the special record date therefor having been so mailed, such Defaulted Interest
shall be paid to the Persons in whose names the Notes (or their respective
Predecessor Notes) are registered at 5:00 p.m., New York City time, on
such special record date and shall no longer be payable pursuant to the
following clause (2) of this Section 2.03.


 


(2) The Company may
make payment of any Defaulted Interest in any other lawful manner not
inconsistent with the requirements of any securities exchange or automated
quotation system on which the Notes may be listed or designated for issuance,
and upon such notice as may be required by such exchange or automated quotation
system, if, after notice given by the Company to the Trustee of the proposed
payment pursuant to this clause, such manner of payment shall be deemed
practicable by the Trustee.


 


Section 2.04 .
Execution of Notes. The Notes shall be signed in the name and on behalf of the
Company by the manual or facsimile signature of an Officer. Only such Notes as
shall bear thereon a certificate of authentication substantially in the form
set forth on the form of Note attached as Exhibit A hereto, manually
executed by the Trustee (or an authenticating agent appointed by the Trustee as
provided by Section 17.11), shall be entitled to the benefits of this
Indenture or be valid or obligatory for any purpose. Such certificate by the
Trustee (or such an authenticating agent) upon any Note executed by the Company
shall be conclusive evidence that the Note so authenticated has been duly
authenticated and delivered hereunder and that the holder is entitled to the
benefits of this Indenture.


 


In case any officer of the
Company who shall have signed any of the Notes shall cease to be such officer
before the Notes so signed shall have been authenticated and delivered by the
Trustee, or disposed of by the Company, such Notes nevertheless may be
authenticated and delivered or disposed of as though the person who signed such
Notes had not ceased to be such officer of the Company, and any Note may be
signed on behalf of the Company by such persons as, at the actual date of the
execution of such Note, shall be the proper officers of the Company, although
at the date of the execution of this Indenture any such person was not such an
officer.


 


Section 2.05 . Exchange
and Registration of Transfer of Notes; Restrictions on Transfer. The Company
shall cause to be kept at the Corporate Trust Office a register (the register
maintained in such office and in any other office or agency of the Company
designated pursuant to Section 6.02 being herein sometimes collectively
referred to as the “Note Register”) in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the registration
of Notes and of transfers of Notes. The Note Register shall be in written form
or in any form capable of being converted into written form within a reasonably
prompt period of time. The Trustee is hereby appointed “Note Registrar” for the
purpose of registering Notes and transfers of Notes as herein provided. The
Company may appoint one or more co-registrars in accordance with Section 6.02.


 


Upon surrender for
registration of transfer of any Note to the Note Registrar or any co-registrar,
and satisfaction of the requirements for such transfer set forth in this Section 2.05,
the Company shall execute, and the Trustee shall authenticate and deliver, in
the name of the designated transferee or transferees, one or more new Notes of
any authorized denominations and of a like aggregate principal amount and
bearing such restrictive legends as may be required by this Indenture.


 


Notes may be exchanged for
other Notes of any authorized denominations and of a like aggregate principal
amount, upon surrender of the Notes to be exchanged at any such office or
agency maintained by the Company pursuant to Section 6.02. Whenever any
Notes are so surrendered for exchange, the Company shall execute, and the
Trustee shall authenticate and deliver, the Notes which the Noteholder making
the exchange is entitled to receive bearing registration numbers not
contemporaneously outstanding.


 


All Notes issued upon any
registration of transfer or exchange of Notes shall be the valid obligations of
the Company, evidencing the same debt, and entitled to the same benefits under
this Indenture, as the Notes surrendered upon such registration of transfer or
exchange.


 


All Notes presented or
surrendered for registration of transfer or for exchange, redemption, repurchase
or conversion shall (if so required by the Company or the Note Registrar) be
duly endorsed, or be accompanied by a written instrument or instruments of
transfer in form satisfactory to the Company, and the Notes shall be duly
executed by the Noteholder thereof or his attorney duly authorized in writing.


 


8

















 


No service charge shall be
made to any holder for any registration of, transfer or exchange of Notes, but
the Company may require payment by the holder of a sum sufficient to cover any
tax, assessment or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Notes.


 


Neither the Company nor the
Trustee nor any Note Registrar shall be required to exchange or register a
transfer of (a) any Notes for a period of fifteen calendar days next
preceding any selection of Notes to be redeemed, (b) any Notes or portions
thereof called for redemption pursuant to Section 3.02, (c) any Notes
or portions thereof surrendered for conversion pursuant to Article 15, (d) any
Notes or portions thereof tendered for repurchase (and not withdrawn) pursuant
to Section 3.05 or (e) any Notes or portions thereof tendered for
repurchase (and not withdrawn) pursuant to Section 3.06.


 


(b) The following
provisions shall apply only to Global Notes:


 


(i) Each Global Note
authenticated under this Indenture shall be registered in the name of the
Depositary or a nominee thereof and delivered to such Depositary or a nominee
thereof or Custodian therefor, and each such Global Note shall constitute a
single Note for all purposes of this Indenture.


 


(ii) Notwithstanding
any other provision in this Indenture, no Global Note may be exchanged in whole
or in part for Notes registered, and no transfer of a Global Note in whole or
in part may be registered, in the name of any Person other than the Depositary
or a nominee thereof unless the Depositary (x) has notified the Company
that it is unwilling or unable to continue as Depositary for such Global Note
or (y) has ceased to be a clearing agency registered under the Exchange
Act, and a successor depositary has not been appointed by the Company within
ninety calendar days, an Event of Default has occurred and is continuing or the
Company, in its sole discretion, notifies the Trustee in writing that it no
longer wishes to have all the Notes represented by Global Notes. Any Global
Note exchanged pursuant to clause (A) or (B) above shall be so
exchanged in whole and not in part and any Global Note exchanged pursuant to
clause (C) above may be exchanged in whole or from time to time in part as
directed by the Company. Any Note issued in exchange for a Global Note or any
portion thereof shall be a Global Note; provided that any such Note so issued
that is registered in the name of a Person other than the Depositary or a
nominee thereof shall not be a Global Note.


 


(iii) Securities issued
in exchange for a Global Note or any portion thereof pursuant to clause (ii) above
shall be issued in definitive, fully registered form, without interest coupons,
shall have an aggregate principal amount equal to that of such Global Note or
portion thereof to be so exchanged, shall be registered in such names and be in
such authorized denominations as the Depositary shall designate and shall bear
any legends required hereunder. Any Global Note to be exchanged in whole shall
be surrendered by the Depositary to the Trustee, as Note Registrar. With regard
to any Global Note to be exchanged in part, either such Global Note shall be so
surrendered for exchange or, if the Trustee is acting as Custodian for the
Depositary or its nominee with respect to such Global Note, the principal
amount thereof shall be reduced, by an amount equal to the portion thereof to
be so exchanged, by means of an appropriate adjustment made on the records of
the Trustee. Upon any such surrender or adjustment, the Trustee shall
authenticate and make available for delivery the Note issuable on such exchange
to or upon the written order of the Depositary or an authorized representative
thereof.


 


(iv) In the event of
the occurrence of any of the events specified in clause (ii) above, the
Company will promptly make available to the Trustee a reasonable supply of
certificated Notes in definitive, fully registered form, without interest
coupons.


 


(v) Neither any members
of, or participants in, the Depositary (“Agent Members”) nor any other Persons
on whose behalf Agent Members may act shall have any rights under this
Indenture with respect to any Global Note registered in the name of the
Depositary or any nominee thereof, and the Depositary or such nominee, as the
case may be, may be treated by the Company, the Trustee and any agent of the
Company or the Trustee as the absolute owner and holder of such Global Note for
all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Company, the Trustee or any agent of the Company or the Trustee
from giving effect to any written certification, proxy or other authorization
furnished by the Depositary or such nominee, as the case may be, or impair, as
between the Depositary, its Agent Members and any other Person on whose behalf
an Agent Member may act, the operation of customary practices of such Persons
governing the exercise of the rights of a holder of any Note.


 


(vi) At such time as
all interests in a Global Note have been redeemed, repurchased, converted,
canceled or exchanged for Notes in certificated form, such Global Note shall,
upon receipt thereof, be canceled by the Trustee in accordance with standing
procedures and instructions existing between the Depositary and the Custodian.
At any time prior to such cancellation, if any interest in a Global Note is
redeemed, repurchased, converted, canceled or exchanged for Notes in
certificated form, the principal amount of such Global Note shall, in
accordance with the standing procedures and instructions existing between the
Depositary and the Custodian, be appropriately reduced, and an endorsement
shall be made on such Global Note, by the Trustee or the Custodian, at the
direction of the Trustee, to reflect such reduction.


 


(c) Every Note (and all
securities issued in exchange therefor or in substitution thereof) that bears
or is required under this Section 2.05(c) to bear the legend set
forth in this Section 2.05(c) (together with any Common Stock issued
upon conversion of the Notes and required to bear the legend set forth in Exhibit B,
collectively, the “Restricted Securities”) shall be subject to the restrictions
on transfer set forth in this Section 2.05(c) (including those set
forth in the legend below and the legend set forth in Exhibit B) unless
such restrictions on transfer shall be waived by written consent of the
Company, and the holder of each such Restricted Security, by such Note holder’s
acceptance thereof, agrees to be bound by all such 


 


9

















 


restrictions on transfer. As
used in this Section 2.05(c), the term “transfer” means any sale, pledge,
loan, transfer or other disposition whatsoever of any Restricted Security or
any interest therein.


 


Until the expiration of the
holding period applicable to sales of Restricted Securities under Rule 144(k) under
the Securities Act (or any successor provision), any certificate evidencing
Restricted Security shall bear a legend in substantially the following form (or
as set forth in Exhibit B, in the case of Common Stock issued upon
conversion of the Notes), unless such Restricted Security has been sold
pursuant to a registration statement that has been declared effective under the
Securities Act (and which continues to be effective at the time of such
transfer) or sold pursuant to Rule 144 under the Securities Act or any
similar provision then in force, or unless otherwise agreed by the Company in
writing, with written notice thereof to the Trustee:


 


THE SECURITY EVIDENCED BY
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS, AND MAY NOT
BE OFFERED OR SOLD EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS
ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER: (1) REPRESENTS
THAT IT IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT AND IS PURCHASING IN COMPLIANCE WITH RULE 144A UNDER THE
SECURITIES ACT; (2) AGREES THAT IT WILL NOT WITHIN TWO YEARS AFTER THE
ORIGINAL ISSUANCE OF THIS SECURITY RESELL OR OTHERWISE TRANSFER THE SECURITY
EVIDENCED HEREBY OR THE COMMON STOCK ISSUABLE UPON CONVERSION OF SUCH SECURITY
EXCEPT (A) TO ADVANCED MEDICAL OPTICS, INC. (“THE COMPANY”) OR ANY
SUBSIDIARY THEREOF, (B) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE
WITH RULE 144A UNDER THE SECURITIES ACT, (C) PURSUANT TO THE EXEMPTION
FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE),
OR (D) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT AND WHICH CONTINUES TO BE EFFECTIVE AT THE
TIME OF SUCH TRANSFER; AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON
TO WHOM THE SECURITY EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN A TRANSFER
PURSUANT TO CLAUSE 2(C) OR 2(D) ABOVE) A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND.


 


IN CONNECTION WITH ANY
TRANSFER OF THE SECURITY EVIDENCED HEREBY WITHIN TWO YEARS AFTER THE ORIGINAL
ISSUANCE OF SUCH SECURITY (OTHER THAN A TRANSFER PURSUANT TO CLAUSE 2(D) ABOVE),
THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF
RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE
TRUSTEE (OR ANY SUCCESSOR TRUSTEE, AS APPLICABLE). IF THE PROPOSED TRANSFER IS
PURSUANT TO CLAUSE 2(C) ABOVE, THE HOLDER MUST, PRIOR TO SUCH TRANSFER,
FURNISH TO THE TRUSTEE (OR ANY SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH
CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS THE COMPANY OR THE
TRUSTEE MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE
PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED
UPON THE EARLIER OF THE TRANSFER OF THE SECURITY EVIDENCED HEREBY PURSUANT TO
CLAUSE 2(C) OR 2(D) ABOVE OR THE EXPIRATION OF TWO YEARS FROM THE
ORIGINAL ISSUANCE OF THE SECURITY EVIDENCED HEREBY.


 


Any Notes that are
Restricted Securities and as to which such restrictions on transfer shall have
expired in accordance with their terms or as to conditions for removal of the
foregoing legend set forth therein have been satisfied may, upon surrender of
such Note for exchange to the Note Registrar in accordance with the provisions
of this Section 2.05, be exchanged for a new Note or Notes, of like tenor
and aggregate principal amount, which shall not bear the restrictive legend
required by this Section 2.05(c). If such Restricted Security surrendered
for exchange is represented by a Global Note bearing the legend set forth in
this Section 2.05(c), the principal amount of the legended Global Note
shall be reduced by the appropriate principal amount and the principal amount
of a Global Note without the legend set forth in this Section 2.05(c) shall
be increased by an equal principal amount. If a Global Note without the legend
set forth in this Section 2.05(c) is not then outstanding, the
Company shall execute and the Trustee shall authenticate and deliver an
unlegended Global Note to the Depositary.


 


(d) Any Restricted
Securities, prior to the expiration of the holding period applicable to sales
thereof under Rule 144(k) under the Securities Act (or any successor
provision), purchased or owned by the Company or any Affiliate thereof may not
be resold by the Company or such Affiliate unless registered under the
Securities Act or resold pursuant to an exemption from the registration
requirements of the Securities Act in a transaction which results in such Notes
or Common Stock, as the case may be, no longer being “restricted securities”
(as defined under Rule 144).


 


(e) The Trustee shall
have no responsibility or obligation to any Agent Members or any other Person
with respect to the accuracy of the books or records, or the acts or omissions,
of the Depositary or its nominee or of any participant or member thereof, with
respect to any ownership interest in the Notes or with respect to the delivery
to any Agent Member or other Person (other than the Depositary) of any notice
(including any notice of redemption) or the payment of any amount, under or
with respect to such Notes. All notices and communications to be given to the
Noteholders and all payments to be made to Noteholders under the Notes shall be
given or made only to or upon the order of the registered Noteholders (which
shall be the Depositary or its nominee in the case of a Global Note). The
rights of beneficial owners in any Global Note shall be exercised only through
the Depositary subject to the customary procedures of the Depository. The
Trustee may rely and shall be fully protected in relying upon information
furnished by the Depositary with respect to its Agent Members.


 


The Trustee shall have no
obligation or duty to monitor, determine or inquire as to compliance with any
restrictions on transfer imposed under this Indenture or under applicable law
with respect to any transfer of any interest in any Note (including any
transfers between or among Agent Members in any Global Indenture) other than to
require delivery of such certificates and other documentation or evidence as
are expressly 


 


10

















 


required by, and to do so if
and when expressly required by, the terms of this Indenture, and to examine the
same to determine substantial compliance as to form with the express
requirements hereof.


 


Section 2.06 .
Mutilated, Destroyed, Lost or Stolen Notes. In case any Note shall become
mutilated or be destroyed, lost or stolen, the Company in its discretion may
execute, and upon its written request the Trustee or an authenticating agent
appointed by the Trustee shall authenticate and make available for delivery, a
new Note, bearing a number not contemporaneously outstanding, in exchange and
substitution for the mutilated Note, or in lieu of and in substitution for the
Note so destroyed, lost or stolen. In every case, the applicant for a
substituted Note shall furnish to the Company, to the Trustee and, if
applicable, to such authenticating agent such security or indemnity as may be
required by them to save each of them harmless for any loss, liability, cost or
expense caused by or connected with such substitution, and, in every case of
destruction, loss or theft, the applicant shall also furnish to the Company, to
the Trustee and, if applicable, to such authenticating agent evidence to their
satisfaction of the destruction, loss or theft of such Note and of the
ownership thereof.


 


Following receipt by the
Trustee or such authenticating agent, as the case may be, of satisfactory
security or indemnity and evidence, as described in the preceding paragraph,
the Trustee or such authenticating agent may authenticate any such substituted
Note and make available for delivery such Note. Upon the issuance of any
substituted Note, the Company may require the payment by the holder of a sum
sufficient to cover any tax, assessment or other governmental charge that may
be imposed in relation thereto and any other expenses connected therewith. In
case any Note which has matured or is about to mature or has been called for
redemption or has been properly tendered for repurchase on a Fundamental Change
Repurchase Date (and not withdrawn) or has been tendered for repurchase on a
Repurchase Date (and not withdrawn), as the case may be, or is to be converted
into Common Stock, shall become mutilated or be destroyed, lost or stolen, the
Company may, instead of issuing a substitute Note, pay or authorize the payment
of or convert or authorize the conversion of the same (without surrender
thereof except in the case of a mutilated Note), as the case may be, if the
applicant for such payment or conversion shall furnish to the Company, to the
Trustee and, if applicable, to such authenticating agent such security or
indemnity as may be required by them to save each of them harmless for any
loss, liability, cost or expense caused by or in connection with such
substitution, and, in every case of destruction, loss or theft, the applicant
shall also furnish to the Company, the Trustee and, if applicable, any Paying
Agent or conversion agent evidence to their satisfaction of the destruction,
loss or theft of such Note and of the ownership thereof.


 


Every substitute Note issued
pursuant to the provisions of this Section 2.06 by virtue of the fact that
any Note is destroyed, lost or stolen shall constitute an additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Note shall be found at any time, and shall be entitled to all the
benefits of (but shall be subject to all the limitations set forth in) this Indenture
equally and proportionately with any and all other Notes duly issued hereunder.
To the extent permitted by law, all Notes shall be held and owned upon the
express condition that the foregoing provisions are exclusive with respect to
the replacement or payment or conversion or redemption or repurchase of
mutilated, destroyed, lost or stolen Notes and shall preclude any and all other
rights or remedies notwithstanding any law or statute existing or hereafter
enacted to the contrary with respect to the replacement or payment or
conversion or redemption or repurchase of negotiable instruments or other
securities without their surrender.


 


Section 2.07 .
Temporary Notes. Pending the preparation of Notes in certificated form, the
Company may execute and the Trustee or an authenticating agent appointed by the
Trustee shall, upon the written request of the Company, authenticate and
deliver temporary Notes (printed or lithographed). Temporary Notes shall be
issuable in any authorized denomination, and substantially in the form of the
Notes in certificated form, but with such omissions, insertions and variations
as may be appropriate for temporary Notes, all as may be determined by the
Company. Every such temporary Note shall be executed by the Company and authenticated
by the Trustee or such authenticating agent upon the same conditions and in
substantially the same manner, and with the same effect, as the Notes in
certificated form. Without unreasonable delay, the Company will execute and
deliver to the Trustee or such authenticating agent Notes in certificated form
and thereupon any or all temporary Notes may be surrendered in exchange
therefor, at each office or agency maintained by the Company pursuant to Section 6.02
and the Trustee or such authenticating agent shall authenticate and make
available for delivery in exchange for such temporary Notes an equal aggregate
principal amount of Notes in certificated form. Such exchange shall be made by
the Company at its own expense and without any charge therefor. Until so
exchanged, the temporary Notes shall in all respects be entitled to the same
benefits and subject to the same limitations under this Indenture as Notes in
certificated form authenticated and delivered hereunder.


 


Section 2.08 .
Cancellation of Notes. All Notes surrendered for the purpose of payment,
redemption, repurchase, conversion, exchange or registration of transfer shall,
if surrendered to the Company or any paying agent to whom Notes may be
presented for payment (the “Paying Agent”) or any conversion agent, which shall
initially be the Trustee, or any Note Registrar, be surrendered to the Trustee
and promptly canceled by it or, if surrendered to the Trustee, shall be
promptly canceled by it and no Notes shall be issued in lieu thereof except as
expressly permitted by any of the provisions of this Indenture. The Trustee
shall dispose of such canceled Notes in accordance with its customary
procedures. If the Company shall acquire any of the Notes, such acquisition
shall not operate as a redemption, repurchase or satisfaction of the
indebtedness represented by such Notes unless and until the same are delivered
to the Trustee for cancellation.


 


Section 2.09 . CUSIP
Numbers. The Company in issuing the Notes may use “CUSIP” numbers (if then
generally in use), and, if so, the Trustee shall use “CUSIP” numbers in notices
of redemption as a convenience to Noteholders; provided that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Notes or as contained in any notice of a redemption
and that reliance may be placed only on the other identification numbers
printed on the Notes, and any such redemption shall not be affected by any
defect in or omission of such numbers. The Company will promptly notify the
Trustee of any change in the “CUSIP” numbers.


 


11
















 


ARTICLE 3

REDEMPTION AND REPURCHASE OF NOTES


 


Section 3.01 . Optional
Redemption of Notes. At any time on or after January 20, 2010 and prior to
maturity, the Notes may be redeemed at the option of the Company, in whole or
in part, upon notice as set forth in Section 3.02, in cash at a redemption
price equal to the principal amount of the Notes, plus accrued and unpaid
interest to, but excluding, the date fixed for redemption.


 


Section 3.02 . Notice
of Optional Redemption; Selection of Notes. In case the Company shall desire to
exercise the right to redeem all or, as the case may be, any part of the Notes
pursuant to Section 3.01, it shall fix a date for redemption and it or, at
its written request received by the Trustee not fewer than five Business Days prior
(or such shorter period of time as may be acceptable to the Trustee) to the
date the notice of redemption is to be mailed, the Trustee in the name of and
at the expense of the Company, shall mail or cause to be mailed a notice of
such redemption not fewer than thirty calendar days nor more than sixty
calendar days prior to the redemption date to each holder of Notes so to be
redeemed in whole or in part at its last address as the same appears on the
Note Register; provided that if the Company makes such request of the Trustee,
it shall, together with such request, also give written notice of the
redemption date to the Trustee, provided that the text of the notice shall be
prepared by the Company. Such mailing shall be by first class mail. The notice,
if mailed in the manner herein provided, shall be conclusively presumed to have
been duly given, whether or not the holder receives such notice. In any case,
failure to give such notice by mail or any defect in the notice to the holder
of any Note designated for redemption as a whole or in part shall not affect
the validity of the proceedings for the redemption of any other Note.
Concurrently with the mailing of any such notice of redemption, the Company
shall issue a press release announcing such redemption, the form and content of
which press release shall be determined by the Company in its sole discretion.
The failure to issue any such press release or any defect therein shall not
affect the validity of the redemption notice or any of the proceedings for the
redemption of any Note called for redemption.


 


Each such notice of
redemption shall specify: (i) the aggregate principal amount of Notes to
be redeemed, (ii) the CUSIP number or numbers of the Notes being redeemed,
(iii) the date fixed for redemption (which shall be a Business Day), (iv) the
redemption price at which Notes are to be redeemed, (v) the place or
places of payment and that payment will be made upon presentation and surrender
of such Notes, (iv) that interest accrued and unpaid to, but excluding,
the date fixed for redemption will be paid as specified in said notice, and
that on and after said date interest thereon or on the portion thereof to be
redeemed will cease to accrue, (vii) that the holder has a right to
convert the Notes called for redemption, (viii) the Conversion Rate on the
date of such notice, (ix) the time and date on which the right to convert
such Notes or portions thereof into Common Stock will expire, (x) whether
the Company has elected to pay upon such conversion cash or a combination of
cash and shares of Common Stock in lieu of delivery of shares of Common Stock
only and, if so, the portion of the Conversion Obligation to be so paid in cash
(specified as a percentage of the Conversion Obligation or a fixed dollar
amount) and the date on which the Cash Settlement Averaging Period will begin,
(xi) the formula for determining the number of shares and/or the amount of cash
to be delivered to the holder upon conversion pursuant to Section 15.12
and (xii) that the Company will pay cash for fractional interests in shares of
Common Stock, if any, as provided in this Indenture. If fewer than all the
Notes are to be redeemed, the notice of redemption shall identify the Notes to
be redeemed (including CUSIP numbers, if any). In case any Note is to be
redeemed in part only, the notice of redemption shall state the portion of the
principal amount thereof to be redeemed and shall state that, on and after the
redemption date, upon surrender of such Note, a new Note or Notes in principal
amount equal to the unredeemed portion thereof will be issued.


 


Whenever any Notes are to be
redeemed, the Company will give the Trustee written notice of the redemption
date, together with an Officers’ Certificate as to the aggregate principal
amount of Notes to be redeemed not fewer than thirty calendar days (or such
shorter period of time as may be acceptable to the Trustee) prior to the
redemption date.


 


On or prior to the
redemption date specified in the notice of redemption given as provided in this
Section 3.02, the Company will deposit with the Paying Agent (or, if the
Company is acting as its own Paying Agent, set aside, segregate and hold in
trust as provided in Section 6.04) an amount of money in immediately
available funds sufficient to redeem on the redemption date all the Notes (or
portions thereof) so called for redemption (other than those theretofore
surrendered for conversion into Common Stock) at the appropriate redemption
price, together with accrued interest to, but excluding, the redemption date;
provided that if such payment is made on the redemption date, it must be
received by the Paying Agent, by 11:00 a.m., New York City time, on such
date. The Company shall be entitled to retain any interest, yield or gain on
amounts deposited with the Paying Agent pursuant to this Section 3.02 in
excess of amounts required hereunder to pay the redemption price and accrued
interest to, but excluding, the redemption date. If any Note called for
redemption is converted pursuant hereto prior to such redemption date, any
money deposited with the Paying Agent or so segregated and held in trust for
the redemption of such Note shall be paid to the Company or, if then held by
the Company, shall be discharged from such trust.


 


If less than all of the
outstanding Notes are to be redeemed, the Trustee shall select the Notes or
portions thereof of the Global Note or the Notes in certificated form to be
redeemed (in principal amounts of $1,000 or multiples thereof) by lot, on a pro
rata basis or by another method the Trustee deems fair and appropriate. If any
Note selected for redemption is submitted for conversion in part after such
selection, the portion of such Note submitted for conversion shall be deemed
(so far as may be possible) to be the portion to be selected for redemption.
The Notes (or portions thereof) so selected for redemption shall be deemed duly
selected for redemption for all purposes hereof, notwithstanding that any such
Note is submitted for conversion in part before the mailing of the notice of redemption.


 


Upon any redemption of less
than all of the outstanding Notes, the Company and the Trustee may (but need
not), solely for purposes of determining the pro rata allocation among such
Notes that are unconverted and outstanding at the time of redemption, treat as
outstanding any Notes surrendered for conversion during the period of fifteen
calendar days preceding the mailing of a notice of redemption and may (but need
not)


 


12

















 


treat as outstanding any
Note authenticated and delivered during such period in exchange for the
unconverted portion of any Note converted in part during such period.


 


Section 3.03 . Payment
of Notes Called for Redemption by the Company. If notice of redemption has been
given as provided in Section 3.02, the Notes or portion of Notes with
respect to which such notice has been given shall, unless converted into Common
Stock pursuant to the terms hereof, become due and payable on the date fixed
for redemption and at the place or places stated in such notice at the
redemption price, plus interest accrued to, but excluding, the redemption date,
and unless the Company shall default in the payment of such Notes at the
redemption price, plus interest, if any, accrued to, but excluding, such date,
interest on the Notes or portion of Notes so called for redemption shall cease
to accrue on and after such date and, after 5:00 p.m., New York City time,
on the Trading Day immediately preceding the redemption date (unless the
Company shall default in the payment of such Notes at the redemption price,
together with interest accrued to such date) such Notes shall cease to be
convertible into Common Stock and, except as provided in Section 9.05 and Section 13.02,
to be entitled to any benefit or security under this Indenture, and the holders
thereof shall have no right in respect of such Notes except the right to
receive the redemption price thereof plus accrued and unpaid interest to, but
excluding, the redemption date. On presentation and surrender of such Notes at
a place of payment in said notice specified, the said Notes or the specified
portions thereof shall be paid and redeemed by the Company at the redemption
price, together with interest accrued thereon to, but excluding, the redemption
date; provided that if the applicable redemption date is after the applicable
Record Date and on or before an interest payment date, the interest payable on
such interest payment date shall be paid on such interest payment date to the
holders of record of such Notes on the applicable Record Date instead of the
holders surrendering such Notes for redemption on such date.


 


Upon presentation of any
Note redeemed in part only, the Company shall execute and the Trustee shall
authenticate and make available for delivery to the holder thereof, at the
expense of the Company, a new Note or Notes, of authorized denominations, in
principal amount equal to the unredeemed portion of the Notes so presented.


 


Notwithstanding the
foregoing, the Trustee shall not redeem any Notes or mail any notice of
redemption during the continuance of a default in payment of interest on the
Notes. If any Note called for redemption shall not be so paid upon surrender
thereof for redemption on the redemption date, as provided in this Section 3.03,
the principal shall, until paid or duly provided for, bear interest from and
including the redemption date at a rate equal to 1% per annum above the rate
borne by the Notes and such Note shall remain convertible into Common Stock
until the redemption price and interest shall have been paid or duly provided
for.


 


Section 3.04 .
Conversion Arrangement on Call for Redemption. In connection with any
redemption of Notes, the Company may arrange for the purchase and conversion of
any Notes by an agreement with one or more investment banks or other purchasers
to purchase such Notes by paying to the Trustee in trust for the Noteholders,
on or before the date fixed for redemption, an amount not less than the
applicable redemption price, together with interest accrued to, but excluding,
the date fixed for redemption, of such Notes. Notwithstanding anything to the
contrary contained in this Article 3, the obligation of the Company to pay
the redemption price of such Notes, together with interest accrued to, but
excluding, the date fixed for redemption, shall be deemed to be satisfied and
discharged to the extent such amount is so paid by such purchasers. If such an
agreement is entered into, a copy of which will be filed with the Trustee prior
to the date fixed for redemption, any Notes not duly surrendered for conversion
by the holders thereof may, at the option of the Company, be deemed, to the
fullest extent permitted by law, acquired by such purchasers from such holders
and (notwithstanding anything to the contrary contained in Article 15)
surrendered by such purchasers for conversion, all as of immediately prior to
5:00 p.m., New York City time, on the date fixed for redemption (and the
right to convert any such Notes shall be extended through such time), subject to
payment of the above amount as aforesaid. At the direction of the Company, the
Trustee shall hold and dispose of any such amount paid to it in the same manner
as it would monies deposited with it by the Company for the redemption of
Notes. Without the Trustee’s prior written consent, no arrangement between the
Company and such purchasers for the purchase and conversion of any Notes shall
increase or otherwise affect any of the powers, duties, responsibilities or
obligations of the Trustee as set forth in this Indenture.


 


Section 3.05 .
Repurchase at Option of Holders Upon a Fundamental Change. If there shall occur
a Fundamental Change at any time prior to maturity of the Notes, then each
Noteholder shall have the right, at such holder’s option, to require the
Company to repurchase all of such holder’s Notes, or any portion thereof that
is a multiple of $1,000 principal amount, on a date (the “Fundamental Change
Repurchase Date”) specified by the Company, that is not less than 20 Business
Days nor more than 35 Business Days after the date of the Company Repurchase
Notice related to such Fundamental Change (or, if such day is not a Business
Day, the next succeeding Business Day) at a repurchase price equal to 100% of
the principal amount of the Notes being repurchased, plus accrued and unpaid
interest to, but excluding, the Fundamental Change Repurchase Date, subject to
the provisions of Section 3.07, and a Make Whole Premium, if any, subject
to the provisions of Section 16.01, in each case, subject to the satisfaction
by the holder of the requirements set forth in Section 3.05(c); provided
that if such Fundamental Change Repurchase Date falls after a Record Date and
on or prior to the corresponding interest payment date, then the interest
payable on such interest payment date shall be paid to the holders of record of
the Notes on the applicable Record Date instead of the holders surrendering the
Notes for repurchase on such date.


 


(b) On or before the
tenth Business Day after the occurrence of a Fundamental Change, the Company
shall mail or cause to be mailed to all holders of record on the date of the
Fundamental Change (and to beneficial owners as required by applicable law) a
Company Repurchase Notice as set forth in Section 3.07(d) with
respect to such Fundamental Change. The Company shall also deliver a copy of
the Company Repurchase Notice to the Trustee and the Paying Agent at such time
as it is mailed to Noteholders. Concurrently with the mailing of such Company
Repurchase Notice, the Company shall issue a press release announcing such
Fundamental Change referred to in the Company Repurchase Notice, the form and
content of which press release shall be determined by the Company in its sole
discretion. The failure to issue any such press release or any defect therein
shall not affect the validity of the Company Repurchase Notice or any
proceedings for the repurchase of any Note which any Noteholder may elect to
have the Company redeem as provided in this Section 3.05.


 


13

















 


No failure of the Company to
give the foregoing notices and no defect therein shall limit the Noteholders’
repurchase rights or affect the validity of the proceedings for the repurchase
of the Notes pursuant to this Section 3.05.


 


(c) For a Note to be so
repurchased at the option of the holder, the holder must deliver to the Paying
Agent, prior to 5:00 p.m., New York City time, on the Business Day
immediately preceding the Fundamental Change Repurchase Date, (i) a
written notice of repurchase (the “Repurchase Notice”) in the form set forth on
the reverse of the Note duly completed (if the Note is certificated) or stating
the following (if the Note is represented by a Global Note): (A) the
certificate number of the Note which the holder will deliver to be repurchased
or the appropriate Depositary procedures, (B) the portion of the principal
amount of the Note which the holder will deliver to be repurchased, which
portion must be in principal amounts of $1,000 or an integral multiple of
$1,000, (C) that such Note shall be repurchased as of the Fundamental
Change Repurchase Date pursuant to the terms and conditions specified in the
Note and in this Indenture and (D) in the event the Company elects
pursuant to Section 3.07 to pay the repurchase price, in whole or in part,
in shares of Applicable Stock but such portion of the Repurchase Price shall
ultimately be paid to such holder entirely in cash because any one of the
conditions to payment of the repurchase price in shares of Applicable Stock is
not satisfied prior to the Fundamental Change Repurchase Date, whether such
holder elects to (x) withdraw such Repurchase Notice as to some or all of
the Notes to which such Repurchase Notice relates (stating the principal amount
and certificate numbers, if any, or the appropriate Depositary procedures, if
applicable, of the Notes as to which such withdrawal shall relate) or (y) receive
cash in respect of the entire repurchase price for all Notes (or portions
thereof) to which such Repurchase Notice relates, together with (ii) such
Notes duly endorsed for transfer (if the Note is certificated) or book-entry
transfer of such Note (if such Note is represented by a Global Note). The
delivery of such Note to the Paying Agent with, or at any time after delivery
of, the Repurchase Notice (together with all necessary endorsements) at the
office of the Paying Agent shall be a condition to the receipt by the holder of
the repurchase price therefore; provided, however, that such repurchase price
shall be so paid pursuant to this Section 3.05 only if the Notes so
delivered to the Paying Agent shall conform in all respects to the description
thereof in the Repurchase Notice. All questions as to the validity, eligibility
(including time of receipt) and acceptance of any Note for repurchase shall be
determined by the Company, whose determination shall be final and binding
absent manifest error.


 


(d) The Company shall
repurchase from the holder thereof, pursuant to this Section 3.05, a
portion of a Note, if the principal amount of such portion is $1,000 or a whole
multiple of $1,000. Provisions of this Indenture that apply to the repurchase
of all of a Note also apply to the repurchase of such portion of such Note.


 


(e) If the Company has
elected to pay the repurchase price in whole or in part in shares of Applicable
Stock pursuant to Section 3.07, but the repurchase price is ultimately
paid to the holder entirely in cash because any one of the conditions set forth
in Section 3.07(c) is not satisfied prior to 5:00 p.m., New York
City time, on the Business Day immediately proceeding the applicable
Fundamental Change Repurchase Date, a holder, in such holder’s Repurchase
Notice and in any written notice of withdrawal delivered by such holder
pursuant to the terms of Section 3.08, may elect to withdraw the
Repurchase Notice as to some or all of the Notes to which it relates, or to
receive cash in respect of the entire repurchase price for all Notes or
portions of Notes subject to such Repurchase Notice. If a holder fails to
indicate in its Repurchase Notice its election to receive cash or withdraw, the
holder shall be deemed to have elected to receive cash in respect of the entire
repurchase price for all Notes subject to such Repurchase Notice.


 


(f) The Paying Agent
shall promptly notify the Company of the receipt by it of any Repurchase Notice
or written notice of withdrawal thereof.


 


Any repurchase by the
Company contemplated pursuant to the provisions of this Section 3.05 shall
be consummated by the delivery of the consideration to be received by the
holder promptly following the later of the Fundamental Change Repurchase Date
and the time of the book-entry transfer or delivery of the Note. Payment of the
repurchase price for a Note for which a Repurchase Notice has been delivered
and not withdrawn is conditioned upon book-entry transfer or delivery of the
Notes, together with necessary endorsements, to the Paying Agent.


 


Section 3.06 .
Repurchase of Notes by the Company at Option of the Holder. (a) Each
Noteholder shall have the right, at such holder’s option, to require the
Company to repurchase all of such holder’s Notes, or any portion thereof that
is a multiple of $1,000 principal amount, on January 15, 2010, July 15,
2014 and July 15, 2019 (each, a “Repurchase Date”), at a repurchase price
of 100% of the principal amount of the Notes being repurchased, plus accrued
and unpaid interest to, but excluding, the Repurchase Date, subject to the
provisions of Section 3.07 and subject to the satisfaction by the holder
of the requirements set forth in Section 3.06(c). Payment of interest will
be paid to the holder of record as of 5:00 p.m., New York City time, on
the applicable Record Date.


 


(b) On or before the
twentieth Business Day prior to each Repurchase Date, the Company shall mail or
cause to be mailed to all holders of record on such date (and to beneficial
owners as required by applicable law) a Company Repurchase Notice as set forth
in Section 3.07(d). The Company shall also deliver a copy of the Company
Repurchase Notice to the Trustee and the Paying Agent at such time as it is
mailed to Noteholders.


 


No failure of the Company to
give the foregoing notices and no defect therein shall limit the Noteholders’
repurchase rights or affect the validity of the proceedings for the repurchase
of the Notes pursuant to this Section 3.06.


 


(c) For a Note to be so
repurchased at the option of the holder, the holder must deliver to the Paying
Agent, during the period beginning at 9:00 a.m., New York City Time, on the
date that is 20 Business Days prior to the applicable Repurchase Date and
ending at 5:00 p.m., New York City Time, on the Business Day immediately
preceding the applicable Repurchase Date, (i) a Repurchase Notice in the
form set forth on the reverse of the Note duly completed (if the Note is
certificated) or stating the following (if the Note is represented by a Global
Note): (A) the certificate number of the Note which the holder will
deliver to be repurchased or the appropriate Depositary procedures, (B) the
portion of the principal amount of the Note which the holder will deliver to be
repurchased, which portion must be in principal amounts of $1,000 or an
integral multiple


 


14

















 


of $1,000, (C) that
such Note shall be repurchased as of the Repurchase Date pursuant to the terms
and conditions specified in the Note and in this Indenture and (D) in the
event the Company elects pursuant to Section 3.07 to pay the repurchase
price, in whole or in part, in shares of Common Stock but such portion of the
Repurchase Price shall ultimately be paid to such holder entirely in cash
because any one of the conditions to payment of the repurchase price in shares
of Common Stock is not satisfied prior to the Repurchase Date, whether such
holder elects to (x) withdraw such Repurchase Notice as to some or all of
the Notes to which such Repurchase Notice relates (stating the principal amount
and certificate numbers, if any, or the appropriate Depositary procedures, if
applicable, of the Notes as to which such withdrawal shall relate) or (y) receive
cash in respect of the entire repurchase price for all Notes (or portions
thereof) to which such Repurchase Notice relates, together with (ii) such
Notes duly endorsed for transfer (if the Note is certificated) or book-entry
transfer of such Note (if such Note is represented by a Global Note). The
delivery of such Note to the Paying Agent with, or at any time after delivery
of, the Repurchase Notice (together with all necessary endorsements) at the
office of the Paying Agent shall be a condition to the receipt by the holder of
the repurchase price therefore; provided, however, that such repurchase price
shall be so paid pursuant to this Section 3.06 only if the Notes so
delivered to the Paying Agent shall conform in all respects to the description
thereof in the Repurchase Notice. All questions as to the validity, eligibility
(including time of receipt) and acceptance of any Note for repurchase shall be
determined by the Company, whose determination shall be final and binding
absent manifest error.


 


(d) The Company shall
repurchase from the holder thereof, pursuant to this Section 3.06, a
portion of a Note, if the principal amount of such portion is $1,000 or a whole
multiple of $1,000. Provisions of this Indenture that apply to the repurchase
of all of a Note also apply to the repurchase of such portion of such Note.


 


(e) If the Company has
elected to pay the repurchase price in whole or in part in shares of Common
Stock pursuant to Section 3.07, but the repurchase price is ultimately
paid to the holder entirely in cash because any one of the conditions set forth
in Section 3.07(a) is not satisfied prior to 5:00 p.m., New York
City time, on the Business Day immediately proceeding the applicable Repurchase
Date, a holder, in such holder’s Repurchase Notice and in any written notice of
withdrawal delivered by such holder pursuant to the terms of Section 3.08,
may elect to withdraw the Repurchase Notice as to some or all of the Notes to
which it relates, or to receive cash in respect of the entire repurchase price
for all Notes or portions of Notes subject to such Repurchase Notice. If a
holder fails to indicate in its Repurchase Notice its election to receive cash
or withdraw, the holder shall be deemed to have elected to receive cash in
respect of the entire repurchase price for all Notes subject to such Repurchase
Notice.


 


(f) The Paying Agent
shall promptly notify the Company of the receipt by it of any Repurchase Notice
or written notice of withdrawal thereof.


 


Any repurchase by the
Company contemplated pursuant to the provisions of this Section 3.06 shall
be consummated by the delivery of the consideration to be received by the
holder promptly following the later of the Repurchase Date and the time of the
book-entry transfer or delivery of the Note. Payment of the repurchase price
for a Note for which a Repurchase Notice has been delivered and not withdrawn
is conditioned upon book-entry transfer or delivery of the Notes, together with
necessary endorsements, to the Paying Agent.


 


Section 3.07 . Company’s
Right to Elect Manner of Payment of Repurchase Price for Payment.


 


(a) The Notes to be
repurchased on any Fundamental Change Repurchase Date pursuant to Section 3.05
or Repurchase Date pursuant to Section 3.06 may be paid for, in whole or
in part, at the election of the Company, (i) in cash or shares of
Applicable Stock, or a combination thereof, in the case of a repurchase
pursuant to Section 3.05 or (ii) in cash or shares of Common Stock,
or a combination thereof, in the case of a repurchase pursuant to Section 3.06,
in either case, subject to the conditions set forth in Section 3.07(c) and
(d). However, the Company may not make such an election pursuant to a
repurchase pursuant to Section 3.06 if the Company has irrevocably elected
to make a cash payment of principal upon conversion pursuant to Section 15.12(b);
in such event, the Company must pay the repurchase price in cash. The Company
may not change its election with respect to the consideration (or components or
percentages of components thereof) to be paid once the Company has given its
Company Repurchase Notice to holders; except pursuant to Section 3.07(c) in
the event of a failure to satisfy, prior to 5:00 p.m., New York City time,
on the Business Day immediately preceding the Fundamental Change Repurchase
Date or the Repurchase Date, as applicable, any condition to the payment of the
repurchase price, in whole or in part, in shares of Applicable Stock or Common
Stock, as the case may be.


 


At least three Business Days
(or such shorter period of time as may be acceptable to the Trustee) before
each Company Repurchase Notice Date, the Company shall deliver an Officers’
Certificate to the Trustee specifying:


 


(i) the manner of
payment selected by the Company,


 


(ii) the information
required by Section 3.07(d) in the Company Repurchase Notice,


 


(iii) if the Company
elects to pay the repurchase price, or a specified percentage thereof, in
shares of Applicable Stock or Common Stock, as the case may be, that the
conditions to such manner of payment set forth in clauses (i) through (iv) of
Section 3.07(c) have been or will be complied with,


 


(iv) whether the
Company desires the Trustee to give the Company Repurchase Notice required by Section 3.07(d) and


 


(v) the other
information required by Section 3.07(c) to be included in the
Officers’ Certificate.


 


15

















 


(b) The Company
Repurchase Notice, as provided in Section 3.07(d), shall be given to
holders in the event of a Fundamental Change, on or before the tenth Business
Day after the occurrence of such a Fundamental Change or not less than 20
Business Days prior to the Repurchase Date (in either case, the “Company
Repurchase Notice Date”).


 


(c) If the Company
elects, pursuant to Section 3.07(a), to pay the repurchase price of Notes
in respect of which a Repurchase Notice pursuant to Section 3.05 or Section 3.06
has been given, or a specified percentage thereof, by the delivery of a number
of shares of Applicable Stock, in the case of a repurchase pursuant to Section 3.05,
or Common Stock, in the case of a repurchase pursuant to Section 3.06, the
number of shares of Applicable Stock or Common Stock, as the case may be, to be
delivered shall equal the quotient obtained by dividing (i) the portion of
the repurchase price to be paid in shares of Applicable Stock or Common Stock,
as the case may be, by (ii) 98.0% of the average of the Closing Sale Price
of one share of Applicable Stock or Common Stock, as the case may be, for the
five Trading-Day period ending on the third Trading Day immediately preceding
the applicable Fundamental Change Repurchase Date or the Repurchase Date (in
each case appropriately adjusted to take into account the occurrence, during
the period commencing on the first Trading Day of the five Trading-Day period
and ending on the Fundamental Change Repurchase Date or the Repurchase Date, as
applicable, of any event described in Section 15.06), subject to the next
succeeding paragraph.


 


The Company will not issue
fractional shares of Applicable Stock or Common Stock, as the case may be, in
payment of the repurchase price. Instead, the Company will pay cash based on
the Closing Sale Price of a share of Applicable Stock or Common Stock, as the
case may be, on the applicable Fundamental Change Repurchase Date or Repurchase
Date for all fractional shares. It is understood that if a holder elects to
have more than one Note repurchased, the number of shares of Applicable Stock
or Common Stock, as the case may be, shall be based on the aggregate amount of
Notes to be repurchased.


 


For purposes of determining
the existence of potential fractional interests, all Notes subject to
repurchase by the Company held by a holder shall be considered together (no
matter how many separate certificates are to be presented). Each holder whose
Notes are repurchased pursuant to Section 3.05 or Section 3.06 shall
receive the same percentage of cash or shares of Common Stock or Applicable
Stock, as the case may be, in payment of the repurchase price for such Notes,
except with regard to the payment of cash in lieu of fractional shares of
Common Stock or Applicable Stock, as the case may be.


 


The Company’s right to
exercise its election to repurchase Notes through the issuance of shares of
Applicable Stock or Common Stock, as the case may be, shall be conditioned
upon:


 


(i) the Company’s
giving a timely Company Repurchase Notice containing an election to repurchase
all or a specified percentage of the Notes with shares of Applicable Stock or
Common Stock, as the case may be, as provided herein;


 


(ii) the registration
of such shares of Applicable Stock or Common Stock, as the case may be, under
the Securities Act and the Exchange Act, if required;


 


(iii) the listing of
such shares of Applicable Stock or Common Stock, as the case may be, on a
United States national securities exchange or the quotation of such shares of
Applicable Stock or Common Stock, as the case may be, in an inter-dealer
quotation system of any registered United States national securities association;


 


(iv) any necessary
qualification or registration of such shares of Applicable Stock or Common
Stock, as the case may be, under applicable state securities laws or the
availability of an exemption from such qualification and registration; and


 


(v) the receipt by the
Trustee of (a) the Officers’ Certificate described in Section 3.07(a) and
stating that the terms of the issuance of the shares of Applicable Stock or
Common Stock, as the case may be, are in conformity with this Indenture and
that the conditions to the issuance of the shares of Applicable Stock or Common
Stock, as the case may be, have been satisfied and (b) upon the Trustee’s
written request, an Opinion of Counsel to the effect that the shares of
Applicable Stock or Common Stock, as the case may be, to be issued in payment
of the repurchase price in respect of the Notes have been duly authorized and,
when issued and delivered pursuant to the terms of this Indenture in payment of
the repurchase price in respect of the Notes, will be validly issued, fully
paid and non-assessable.


 


Such Officers’ Certificate
shall also set forth the number of shares of Applicable Stock or Common Stock,
as the case may be, to be issued for each $1,000 principal amount of Notes and
the Closing Sale Price of a share of Applicable Stock or Common Stock, as the
case may be, on each Trading Day during the five Trading-Day period ending on
the third Trading Day prior to the applicable Fundamental Change Repurchase
Date or Repurchase Date. If the foregoing conditions are not satisfied prior to
5:00 p.m., New York City time, on the Business Day immediately preceding
the applicable Fundamental Change Repurchase Date or Repurchase Date, as
applicable, and the Company has elected to repurchase the Notes through the
issuance of shares of Applicable Stock or Common Stock, as the case may be, the
Company shall pay the entire repurchase price of the Notes in cash.


 


Promptly after determination
of the actual number of shares of Applicable Stock or Common Stock, as the case
may be, to be issued upon repurchase of Notes, the Company shall be required to
disseminate a press release through Dow Jones & Company, Inc. or
Bloomberg Business News containing this information or publish the information
on the Company’s web site or through such other public medium as the Company
may use at that time.


 


16

















 


(d) In connection with
any repurchase of Notes, the Company shall, in the case of a Fundamental
Change, on or before the tenth Business Day after the Effective Date of such
Fundamental Change or no less than 20 Business Days prior to each Repurchase
Date, give notice to holders (with a copy to the Trustee) setting forth
information specified in this Section 3.07(d) (in either case, the “Company
Repurchase Notice”).


 


Each Company Repurchase
Notice shall:


 


(1) state the
repurchase price and the Fundamental Change Repurchase Date or the Repurchase
Date to which the Company Repurchase Notice relates;


 


(2) state, if
applicable, the circumstances constituting the Fundamental Change;


 


(3) state whether the
repurchase price will be paid in cash, shares of Applicable Stock or Common
Stock, as the case may be, or a combination thereof, specifying the percentages
of each;


 


(4) state that holders
must exercise their right to elect repurchase prior to 5:00 p.m., New York
City time, on the Business Day immediately preceding the Fundamental Change
Repurchase Date or Repurchase Date, as the case may be;


 


(5) if shares of
Applicable Stock or Common Stock, as the case may be, will be used to pay all
or part of the repurchase price, state:


 


(a) the method for
calculating the number of shares of Applicable Stock or Common Stock, as the
case may be, to be delivered in connection with the repurchase; and


 


(b) that holders of the
Notes will bear the market risk with respect to the value of the shares of
Applicable Stock or Common Stock, as the case may be, to be delivered from the
date the number of shares is determined;


 


(6) include a form of
Repurchase Notice;


 


(7) state the name and
address of the Paying Agent;


 


(8) state that Notes
must be surrendered to the Paying Agent to collect the repurchase price;


 


(9) state that a holder
may withdraw its Repurchase Notice at any time prior to 5:00 p.m., New
York City time, on the Business Day immediately preceding the Fundamental
Change Repurchase Date or the Repurchase Date, as the case may be, by
delivering a valid written notice of withdrawal in accordance with Section 3.08;


 


(10) if the Notes are
then convertible, state that Notes as to which a Repurchase Notice has been
given may be converted only if the Repurchase Notice is withdrawn in accordance
with the terms of this Indenture;


 


(11) state the amount of
interest accrued and unpaid per $1,000 principal amount of Notes to, but
excluding, the Fundamental Change Repurchase Date and Repurchase Date, as the
case may be; and


 


(12) state the CUSIP number
of the Notes.


 


A Company Repurchase Notice
may be given by the Company or, at the Company’s request, the Trustee shall
give such Company Repurchase Notice in the Company’s name and at the Company’s
expense; provided, that the text of the Company Repurchase Notice shall be
prepared by the Company.


 


(e) All shares of
Applicable Stock or Common Stock, as the case may be, delivered upon repurchase
of the Notes shall be duly authorized, validly issued, fully paid and
nonassessable.


 


(f) If a holder of a
repurchased Note is paid in shares of Applicable Stock or Common Stock, as the
case may be, the Company shall pay any documentary, stamp or similar issue or
transfer tax due on such issue of Applicable Stock or Common Stock, as the case
may be. However, the holder shall pay any such tax which is due because the
holder requests the Applicable Stock or Common Stock, as the case may be, to be
issued in a name other than the holder’s name. The Paying Agent may refuse to
deliver the certificates representing the shares of Common Stock being issued
in a name other than the holder’s name until the Paying Agent receives a sum
sufficient to pay any tax which will be due because the shares of Applicable
Stock or Common Stock, as the case may be, are to be issued in a name other
than the holder’s name. Nothing herein shall preclude any income tax
withholding required by law or regulations.


 


(g) The Company will,
to the extent applicable, comply with the provisions of Rule 13e-4 and Rule 14e-1
(or any successor provision) under the Exchange Act that may be applicable at
the time of the repurchase of the Notes, file the related Schedule TO (or any
successor schedule, form or report) under the Exchange Act and comply with all
other federal and state securities laws in connection with the repurchase of
the Notes.


 


Section 3.08 . Effect
of Repurchase Notice; Withdrawal. Upon receipt by the Paying Agent of the Repurchase
Notice specified in Section 3.05 or Section 3.06, the holder of the
Note in respect of which such Repurchase Notice was given shall (unless such
Repurchase Notice is validly


 


17

















 


withdrawn in accordance with
the following paragraph) thereafter be entitled to receive solely the
repurchase price with respect to such Note. Such repurchase price shall be paid
to such holder, subject to receipt of funds and/or Notes by the Paying Agent,
promptly following the later of (x) the Fundamental Change Repurchase Date
or the Repurchase Date with respect to such Note (provided the holder has
satisfied the conditions in Section 3.05 or Section 3.06) and (y) the
time of book-entry transfer or delivery of such Note to the Paying Agent by the
holder thereof in the manner required by Section 3.05 or Section 3.06.
Notes in respect of which a Repurchase Notice has been given by the holder
thereof may not be converted pursuant to Article 15 hereof on or after the
date of the delivery of such Repurchase Notice unless such Repurchase Notice
has first been validly withdrawn.


 


A Repurchase Notice may be
withdrawn by means of a written notice of withdrawal delivered to the office of
the Paying Agent in accordance with the Repurchase Notice at any time prior to
5:00 p.m., New York City time, on the Business Day immediately preceding
the Fundamental Change Repurchase Date or Repurchase Date, as the case may be,
specifying:


 


(a) the certificate
number, if any, of the Note in respect of which such notice of withdrawal is
being submitted, or the appropriate Depositary information, in accordance with
appropriate Depositary procedures, if the Note in respect of which such notice
of withdrawal is being submitted is represented by a Global Note,


 


(b) the principal
amount of the Note with respect to which such notice of withdrawal is being
submitted, and


 


(c) the principal
amount, if any, of such Note which remains subject to the original Repurchase
Notice and which has been or will be delivered for repurchase by the Company.


 


If a Repuchase Notice is
properly withdrawn, the Company shall not be obligated to repurchase the Notes
listed in such Repurchase Notice.


 


Section 3.09 . Deposit
of Repurchase Price. (a) Prior to 11:00 a.m., New York City Time, on
the Fundamental Change Repurchase Date or the Repurchase Date, the Company
shall deposit with the Paying Agent or, if the Company is acting as the Paying
Agent, shall segregate and hold in trust as provided in Section 6.04) an
amount of cash (in immediately available funds if deposited on the Fundamental
Change Repurchase Date or the Repurchase Date, as the case may be), sufficient
to pay the aggregate repurchase price of all the Notes or portions thereof that
are to be repurchased for cash as of the Fundamental Change Repurchase Date or
the Repurchase Date, as the case may be.


 


As soon as practicable after
the Fundamental Change Repurchase Date or the Repurchase Date, as the case may
be, the Company shall deliver to each holder entitled to receive shares of
Applicable Stock or Common Stock, as the case may be, through the Paying Agent,
a certificate for the number of full shares of Applicable Stock or Common
Stock, as the case may be, issuable in payment of the repurchase price and cash
in lieu of any fractional interests. The person in whose name the certificate
for the shares of Applicable Stock or Common Stock, as the case may be, is
registered shall be treated as a holder of record of Applicable Stock or Common
Stock, as the case may be, on the Business Day following the applicable
Fundamental Change Repurchase Date or the Repurchase Date. No payment or
adjustment in the repurchase price will be made for dividends on the shares of
Applicable Stock or Common Stock, as the case may be, the Record Date for which
occurred on or prior to the Fundamental Change Repurchase Date or the
Repurchase Date, as applicable.


 


If on the Fundamental Change
Repurchase Date or the Repurchase Date the Paying Agent holds money or shares
of Applicable Stock or Common Stock, as the case may be, sufficient to pay the
repurchase price of the Notes that holders have elected to require the Company
to repurchase in accordance with Section 3.05 or 3.06, as the case may be,
then, on the Fundamental Change Repurchase Date or the Repurchase Date, as the
case may be, such Notes will cease to be outstanding, interest will cease to
accrue and all other rights of the holders of such Notes will terminate, other
than the right to receive the repurchase price upon delivery or book-entry transfer
of the Note. This will be the case whether or not book-entry transfer of the
Note has been made or the Note has been delivered to the Paying Agent.


 


Section 3.10 . Notes
Repurchased in Part. Upon presentation of any Note repurchased only in part, the
Company shall execute and the Trustee shall authenticate and make available for
delivery to the holder thereof, at the expense of the Company, a new Note or
Notes, of any authorized denomination, in aggregate principal amount equal to
the unrepurchased portion of the Notes presented.


 


Section 3.11 .
Repayment to the Company. The Paying Agent shall return to the Company any cash
or shares of Applicable Stock or Common Stock, as the case may be, that remain
unclaimed, together with interest or dividends, if any, thereon, held by them
for the payment of the repurchase price; provided that to the extent that the
aggregate amount of cash or shares of Applicable Stock or Common Stock, as the
case may be, by the Company pursuant to Section 3.09 exceeds the aggregate
repurchase price of the Notes or portions thereof which the Company is
obligated to repurchase as of the Fundamental Change Repurchase Date or the
Repurchase Date, as the case may be, then, unless otherwise agreed in writing
with the Company, promptly after the Business Day following the Fundamental
Change Repurchase Date or the Repurchase Date, as the case may be, the Trustee
shall return any such excess to the Company together with interest or
dividends, if any, thereon.


 


ARTICLE 4

SUBORDINATION OF NOTES


 


Section 4.01 . Notes
Subordinated To Senior Indebtedness. The Company covenants and agrees, and the
Trustee and each holder of the Notes by the acceptance thereof likewise
covenant and agree, that all Notes shall be issued subject to the provisions of
this Article 4; and each person


 


18

















 


holding any Note, whether
upon original issue or upon transfer, assignment or exchange thereof, accepts
and agrees that all payments of the principal of, premium, if any, and interest
on (and other obligations, if any, with respect to) the Notes by the Company
shall, to the extent and in the manner set forth in this Article 4, be
subordinated and junior in right of payment to the prior payment in full in
cash of all obligations arising under Senior Indebtedness. The Notes will be
contractually equal in right of payment to the Company’s other existing and
future senior subordinated indebtedness, including the Company’s 9 1/4% Senior
Subordinated Notes due 2010 and the Company’s 3 1/2% Convertible Senior
Subordinated Notes due April 15, 2023.


 


Section 4.02 . No
Payment On Notes In Certain Circumstances.


 


(a) No direct or
indirect payment (other than in Junior Securities) by or on behalf of the
Company of principal of, premium, if any, or interest on (and other
obligations, if any, with respect to) the Notes, whether pursuant to the terms
of the Notes, upon acceleration, pursuant to an offer to repurchase, redemption
or otherwise, will be made, if, at the time of such payment, there exists a
default in the payment of all or any portion of the obligations on any
Designated Senior Indebtedness, whether at maturity, on account of mandatory
redemption or prepayment, acceleration or otherwise, and such default shall not
have been cured or waived in writing or the benefits of this sentence waived in
writing by or on behalf of the holders of such Designated Senior Indebtedness.
In addition, during the continuance of any non-payment event of default with
respect to any Designated Senior Indebtedness pursuant to which the maturity
thereof may be immediately accelerated by the holder or holders of such
Designated Senior Indebtedness or may be accelerated by the holder or holders
of such Designated Senior Indebtedness with the giving of notice or the passage
of time or both, and upon receipt by the Trustee of written notice (a “Payment
Blockage Notice”) from the holder or holders of such Designated Senior
Indebtedness or the trustee or agent acting on behalf of the holders of such
Designated Senior Indebtedness, then, unless and until such event of default
has been cured or waived in writing or has ceased to exist or such Designated
Senior Indebtedness has been discharged or repaid in full in cash (or such
payment shall be duly provided for in a manner satisfactory to holders of
Senior Indebtedness) or otherwise to the extent holders of Senior Indebtedness
in their sole discretion accept satisfaction of amounts due by settlement in
other than cash or the benefits of these provisions have been waived in writing
by the holders of such Designated Senior Indebtedness, no direct or indirect
payment (other than in Junior Securities) will be made by or on behalf of the
Company of principal of, premium, if any, or interest on (and other
obligations, if any, with respect to) the Notes, whether pursuant to the terms
of the Notes, upon acceleration, pursuant to an offer to repurchase, redemption
or otherwise to such holders during a period (a “Payment Blockage Period”)
commencing on the date of receipt of the Payment Blockage Notice by the Trustee
and ending 179 days thereafter. The Trustee shall deliver a copy of the Payment
Blockage Notice to the Company promptly upon receipt thereof.


 


Notwithstanding anything in
the subordination provisions of this Indenture or the Notes to the contrary, (1) in
no event will a Payment Blockage Period extend beyond 179 days from the date
the Payment Blockage Notice in respect thereof was given and (2) not more
than one Payment Blockage Period may exist with respect to the Notes during any
period of 360 consecutive calendar days. No default that existed or was
continuing on the date of delivery of any Payment Blockage Notice (whether or
not such event is with respect to the same issue of Designated Senior
Indebtedness) may be, or be made, the basis for a subsequent Payment Blockage
Notice, unless such default has been cured or waived for a period of not less
than 90 consecutive calendar days.


 


(b) In the event that,
notwithstanding the foregoing, any payment shall be received by the Trustee or
any holder at a time when such payment is prohibited by Section 4.02(a),
such payment shall be received and held in trust for the benefit of, and shall
be paid over or delivered to, the holders of Designated Senior Indebtedness or
their respective representatives, or to the trustee or trustees or agent or
agents under any indenture or agreement pursuant to which any of such
Designated Senior Indebtedness may have been issued or incurred, as their
respective interests may appear, but only to the extent that, upon notice from
the Trustee to the holders of Designated Senior Indebtedness that such
prohibited payment has been made, the holders of the Designated Senior
Indebtedness (or their representative or representatives or a trustee or trustees)
notify the Trustee in writing of the amounts then due and owing on the
Designated Senior Indebtedness, if any, and only the amounts specified in such
notice to the Trustee shall be paid to the holders of Designated Senior
Indebtedness.


 


Section 4.03. Payment
Over Of Proceeds Upon Dissolution, Etc.


 


(a) Upon any payment or
distribution of assets or securities of the Company of any kind or character,
whether in cash, property or securities, to the creditors of the Company upon
any dissolution or winding-up or total liquidation or reorganization of the
Company, whether voluntary or involuntary, or in bankruptcy, insolvency,
receivership or other similar proceedings relating to the Company, any
assignment for the benefit of creditors or any marshalling of the Company’s
assets and liabilities, the holders of Senior Indebtedness shall be entitled to
receive payment in full in cash of all obligations due in respect of such
Senior Indebtedness (including interest accruing after, or which would accrue
but for, the commencement of any proceeding at the rate specified in the
applicable Senior Indebtedness, whether or not a claim for such interest would
be allowed), or have provision made for such payment in a manner acceptable to
holders of such Senior Indebtedness, before the holders of the Notes or the
Trustee on behalf of such holders shall be entitled to receive any payment by
the Company of the principal of, premium, if any, or interest on (and other
obligations, if any, with respect to) the Notes, or any payment by the Company
to acquire any of the Notes for cash, property or securities, or any
distribution by the Company with respect to the Notes of any cash, property or
securities (in each case, other than payments in Junior Securities).


 


(b) In the event that,
notwithstanding the foregoing provision prohibiting such payment or
distribution, any payment or distribution of assets or securities of the
Company of any kind or character, whether in cash, property or securities (in
each case, other than Junior Securities), shall be received by the Trustee or
any Paying Agent or any holder of Notes at a time when such payment or
distribution is prohibited by Section 4.03(a) and before all
obligations in respect of Senior Indebtedness are paid in full in cash (or such
payment shall be duly provided for in a manner satisfactory to the holders of
Senior Indebtedness) or otherwise to the extent holders of Senior Indebtedness
in their sole discretion accept


 


19

















 


satisfaction of amounts due
by settlement in other than cash, such payment or distribution shall be
received and held in trust for the benefit of, and shall be paid over or
delivered to, the holders of Senior Indebtedness (pro rata to such holders on
the basis of the respective amounts of Senior Indebtedness held by such
holders) or their respective representatives, or to the trustee or trustees or
agent or agents under any indenture or agreement pursuant to which any of such
Senior Indebtedness may have been issued or incurred, as their respective
interests may appear, for application to the payment of Senior Indebtedness
remaining unpaid until all such Senior Indebtedness has been paid in full in
cash (or such payment shall be duly provided for in a manner satisfactory to
the holders of Senior Indebtedness) or otherwise to the extent holders of
Senior Indebtedness in their sole discretion accept satisfaction of amounts due
by settlement in other than cash after giving effect to any prior or concurrent
payment, distribution or provision therefor to or for the holders of such
Senior Indebtedness.


 


The consolidation of the
Company with, or the merger of the Company with or into, another corporation or
limited liability company or the liquidation or dissolution of the Company
following the sale, conveyance, transfer or lease of the Company’s and its
subsidiaries’ property as an entirety, or substantially as an entirety, to
another corporation upon the terms and conditions provided in Article 12
shall not be deemed a dissolution, winding-up, liquidation or reorganization
for the purposes of this Article 4 if such other corporation shall, as a
part of such consolidation, merger, sale, conveyance, transfer or lease, comply
with the conditions stated in Article 12.


 


Section 4.04 . Subrogation.
Upon the payment in full in cash (or such payment shall be duly provided for in
a manner satisfactory to the holders of Senior Indebtedness) or otherwise to
the extent holders of Senior Indebtedness in their sole discretion accept
satisfaction of amounts due by settlement in other than cash of all Senior
Indebtedness, the holders of the Notes shall be subrogated to the rights of the
holders of Senior Indebtedness to receive payments or distributions of cash,
cash equivalents, property or securities of the Company made on such Senior
Indebtedness until the principal of, premium, if any, and interest on the Notes
shall be paid in full in cash or the Notes are no longer outstanding; and, for
the purposes of such subrogation, no payments or distributions to the holders
of the Senior Indebtedness of any cash, cash equivalents, property or
securities to which the holders of the Notes or the Trustee on their behalf
would be entitled except for the provisions of this Article 4, and no
payment over pursuant to the provisions of this Article 4 to the holders
of Senior Indebtedness by holders of the Notes or the Trustee on their behalf
shall, as between the Company, its creditors other than holders of Senior
Indebtedness, and the holders of the Notes, be deemed to be a payment by the
Company to or on account of the Senior Indebtedness. It is understood that the
provisions of this Article 4 are and are intended solely for the purpose
of defining the relative rights of the holders of the Notes, on the one hand,
and the holders of the Senior Indebtedness, on the other hand.


 


If any payment or
distribution to which the holders of the Notes would otherwise have been
entitled but for the provisions of this Article 4 shall have been applied,
pursuant to the provisions of this Article 4, to the payment of all
amounts payable under Senior Indebtedness, then and in such case, the holders
of the Notes shall be entitled to receive from the holders of such Senior
Indebtedness any payments or distributions received by such holders of Senior
Indebtedness in excess of the amount required to make payment in full in cash
of such Senior Indebtedness (or to duly provide for such payment in a manner
satisfactory to the holders of Senior Indebtedness) or otherwise to the extent
holders of Senior Indebtedness in their sole discretion accept satisfaction of
amounts due by settlement in other than cash.


 


Section 4.05 .
Obligations Of Company Unconditional. Nothing contained in this Article 4
or elsewhere in this Indenture or in the Notes is intended to or shall impair,
as among the Company and the holders of the Notes, the obligation of the
Company, which is absolute and unconditional, to pay to the holders of the
Notes the principal of, premium on and interest on the Notes as and when the
same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the holders of the Notes and
creditors of the Company other than the holders of the Senior Indebtedness, nor
shall anything herein or therein prevent the holder of any Note or the Trustee
on their behalf from exercising all remedies otherwise permitted by applicable
law upon default under this Indenture, subject to the rights, if any, under
this Article 4 of the holders of the Senior Indebtedness in respect of
cash, cash equivalents, property or securities of the Company received upon the
exercise of any such remedy.


 


Without limiting the
generality of the foregoing, nothing contained in this Article 4 shall
restrict the right of the Trustee or the holders of Notes to take any action to
declare the Notes to be due and payable prior to their stated maturity pursuant
to Section 8.01 or to pursue any rights or remedies hereunder; provided,
however, that all Senior Indebtedness then due and payable shall first be paid
in full in cash (including Post-Petition Interest), or have provision made for
such payment in a manner satisfactory to the holders of such Senior
Indebtedness, before the holders of the Notes or the Trustee are entitled to receive
any direct or indirect payment from the Company of principal of, premium and
interest on (and other obligations, if any, with respect to) the Notes.


 


Section 4.06 . Notice
To Trustee. The Company shall give prompt written notice to the Trustee of any fact
known to the Company which would prohibit the making of any payment to or by
the Trustee in respect of the Notes pursuant to the provisions of this Article 4.
Unless the Trustee has failed to give notice of its change of address pursuant
to Section 17.03 hereof, the Trustee shall not be charged with knowledge
of the existence of any event of default with respect to any Senior
Indebtedness or of any other facts which would prohibit the making of any
payment to or by the Trustee unless and until the Trustee shall have received
notice in writing at its Corporate Trust Office to that effect signed by an
Officer of the Company, or by a holder of Senior Indebtedness or trustee or
agent therefor; and prior to the receipt of any such written notice, the Trustee
subject to the provisions of Article 9 shall, be entitled to assume that
no such facts exist; provided, however, that if the Trustee shall not have
received the notice provided for in this Section 4.06 at least one
Business Day prior to the date upon which by the terms of this Indenture any
moneys shall become payable for any purpose (including, without limitation, the
payment of the principal of, premium, if any, or interest on any Note), then,
regardless of anything herein to the contrary, the Trustee shall have full
power and authority to receive any moneys from the Company and to apply the
same to the purpose for which they were received, and shall not be affected by
any notice to the contrary which may be received by it on or after such prior
date. Nothing contained in this Section 4.06 shall limit the right of the
holders of Senior Indebtedness to recover payments as 


 


20

















 


contemplated by Section 4.03
or from any holder under Section 4.02(b). The Trustee shall be entitled to
conclusively rely on the delivery to it of a written notice by a Person
representing himself or itself to be a holder of any Senior Indebtedness (or a
trustee on behalf of, or agent or other representative of, such holder) to
establish that such notice has been given by a holder of such Senior
Indebtedness or a trustee or agent or representative on behalf of any such
holder. A holder of Senior Indebtedness and any trustee, agent or other
representative on behalf of such holder shall be entitled to deliver all
notices required by this Section 4.06 or otherwise pursuant to this Article 4
to the address of the Trustee set forth herein unless such holder or the
trustee, agent or representative of such holder shall have received actual
written notice of a change of address of the Trustee.


 


In the event that the
Trustee determines in good faith that any evidence is required with respect to
the right of any Person as a holder of Senior Indebtedness to participate in
any payment or distribution pursuant to this Article 4, the Trustee may
request such Person to furnish evidence to the reasonable satisfaction of the
Trustee as to the amount of Senior Indebtedness held by such Person, the extent
to which such Person is entitled to participate in such payment or distribution
and any other facts pertinent to the rights of such Person under this Article 4,
and if such evidence is not furnished, the Trustee may defer any payment to
such Person pending judicial determination as to the right of such Person to
receive such payment.


 


Section 4.07 . Trustee’s
Relation To Senior Indebtedness. The Trustee and any Paying Agent shall be
entitled to all the rights set forth in this Article 4 with respect to any
Senior Indebtedness which may at any time be held by it in its individual or
any other capacity to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee or any
Paying Agent of any of its rights as such holder.


 


With respect to the holders
of Senior Indebtedness, the Trustee undertakes to perform or to observe only
such of its covenants and obligations as are specifically set forth in this Article 4,
and no implied covenants or obligations with respect to the holders of Senior
Indebtedness shall be read into this Indenture against the Trustee. The Trustee
shall not be deemed to owe any fiduciary duty to the holders of Senior
Indebtedness (except as provided in Section 4.02(b) and 4.03(b)). The
Trustee shall not be liable to any such holders if the Trustee shall in good
faith mistakenly pay over or distribute to holders of Notes or to the Company
or to any other person cash, property or securities to which any holders of
Senior Indebtedness shall be entitled by virtue of this Article 4 or
otherwise.


 


Section 4.08 .
Subordination Rights Not Impaired By Acts Or Omissions Of The Company Or
Holders Of Senior Indebtedness. No right of any present or future holders of
any Senior Indebtedness to enforce subordination as provided herein shall at
any time in any way be prejudiced or impaired by any act or failure to act on
the part of the Company or by any act or failure to act, in good faith, by any
such holder, or by any noncompliance by the Company with the terms of this
Indenture, regardless of any knowledge thereof which any such holder may have
or otherwise be charged with. The provisions of this Article 4 are
intended to be for the benefit of, and shall be enforceable directly by, the
holders of Senior Indebtedness.


 


Section 4.09 . Holders
Authorize Trustee To Effectuate Subordination Of Notes. Each holder of Notes by
his acceptance of such Notes authorizes and expressly directs the Trustee on
his behalf to take such action as may be necessary or appropriate to effectuate
the subordination provided in this Article 4, and appoints the Trustee his
attorney-in-fact for such purposes, including, in the event of any dissolution,
winding-up, total liquidation or reorganization of the Company (whether in
bankruptcy, insolvency, receivership, reorganization or similar proceedings or
upon an assignment for the benefit of creditors or otherwise) tending towards
liquidation of the business and assets of the Company, the filing of a claim
for the unpaid balance of its or his Notes in the form required in those
proceedings.


 


Section 4.10 . This Article Not
To Prevent Events Of Default. The failure to make a payment on account of
principal of, or premium, if any, or interest on the Notes by reason of any
provision of this Article 4 shall not be construed as preventing the occurrence
of an Event of Default specified in clauses (a) or (b) of Section 8.01.


 


Section 4.11 . Trustee’s
Compensation And Rights To Indemnification Not Prejudiced. Nothing in this Article 4
shall apply to amounts due to the Trustee, or its rights to indemnification,
pursuant to other sections in this Indenture.


 


Section 4.12 . No
Waiver Of Subordination Provisions. Without in any way limiting the generality
of Section 4.08, the holders of Senior Indebtedness may, at any time and
from time to time, without the consent of or notice to the Trustee or the
holders of the Notes, without incurring responsibility to the holders of the
Notes and without impairing or releasing the subordination provided in this Article 4
or the obligations hereunder of the holders of the Notes to the holders of
Senior Indebtedness, do any one or more of the following: (a) change the
manner, place or terms of payment or extend the time of payment of, or renew,
alter or amend, Senior Indebtedness or any instrument evidencing the same or any
agreement under which Senior Indebtedness is outstanding or secured; (b) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing Senior Indebtedness; (c) release any Person liable in
any manner for the collection of Senior Indebtedness; and (d) exercise or
refrain from exercising any rights against the Company and any other Person.


 


Section 4.13 .
Subordination Provisions Not Applicable To Money Held In Trust For Holders;
Payments May Be Paid Prior To Dissolution. All funds deposited in trust
with the Paying Agent pursuant to and in accordance with Article 13 when
permitted pursuant to Article 4 shall be for the sole benefit of the
holders and shall not be subject to this Article 4.


 


21
















 


Nothing contained in this Article 4
or elsewhere in this Indenture shall prevent (i) the Company, except under
the conditions described in this Article 4, from making payments of
principal of, premium, if any, and interest on the Notes or from depositing with
the Paying Agent any moneys for such payments or from effecting a termination
of the Company’s obligations under the Notes and this Indenture as provided in Article 13,
or (ii) the application by the Trustee of any moneys deposited with it or
any Paying Agent for the purpose of making such payments of principal of,
premium, if any, and interest on the Notes, to the holders entitled thereto
unless at least one Business Day prior to the date upon which such payment
becomes due and payable, the Trustee shall have received the written notice
provided for in Section 4.02(b) or in Section 4.06. The Company
shall give prompt written notice to the Trustee of any dissolution, winding-up,
liquidation or reorganization of the Company.


 


Section 4.14 .
Acceleration Of Notes. If payment of the Notes is accelerated because of an
Event of Default, the Company shall promptly notify holders of the Senior
Indebtedness of the acceleration.


 


Section 4.15 . Certain
Conversions and Repurchases Not Deemed Payment. For the purposes of this Article 4
only, (1) (x) the issuance and delivery of Junior Securities upon
conversion of Notes in accordance with, and (y) the payment, issuance or
delivery of cash, property or securities upon conversion of a Note as a result
of any transaction pursuant to, Section 15.01 or (2) the issuance and
delivery of Junior Securities made in connection with repurchases of Notes in
accordance with Sections 3.05 and 3.06, shall not be deemed to constitute a
payment or distribution on account of the principal of, premium, if any, or
interest on Notes or on account of the purchase or other acquisition of Notes.
For the purposes of this Article 4, the term “Junior Securities” means (a) Common
Stock of the Company or Applicable Stock, as the case may be, or (b) securities
of the Company that are subordinated in right of payment to all Senior
Indebtedness that may be outstanding at the time of issuance or delivery of
such securities to at least the same extent as, or to a greater extent than,
the Notes are so subordinated as provided in this Article 4. Nothing
contained in this Article 4 or elsewhere in this Indenture or in the Notes
is intended to or shall impair, as among the Company, its creditors (other than
holders of Senior Indebtedness) and the Noteholders, the right, which is
absolute and unconditional, of the holder of any Note to convert such Note in
accordance with Section 15.01.


 


ARTICLE 5

CONTINGENT INTEREST


 


Section 5.01
.. Contingent Interest. Beginning
with the six-month interest period commencing January 15, 2010, the
Company will pay contingent interest during any six-month interest period if
the Trading Price of the Notes for each of the five Trading Days ending on the
second Trading Day immediately preceding the first day of the applicable six-month
interest period equals or exceeds 120% of the principal amount of the Notes.
During any six-month interest period when contingent interest is payable, the
contingent interest payable on each $1,000 principal amount of Notes shall
equal 0.25% of the average Trading Price of $1,000 principal amount of Notes
during the five Trading Days immediately preceding the first day of the
applicable six-month interest period used to determine whether contingent
interest must be paid.


 


The Trustee’s sole
responsibility pursuant to Section 5.01 hereof shall be to obtain the
Trading Price of the Notes for each of the five Trading Days immediately
preceding the first day of the applicable six-month interest period and to
provide such information to the Company. The Company shall determine whether
holders are entitled to receive contingent interest, and if so, provide notice
pursuant to Section 5.03. Notwithstanding any term contained in this
Indenture or any other document to the contrary, the Trustee shall have no
responsibilities, duties or obligations for or with respect to (i) determining
whether the Company must pay contingent interest or (ii) determining the
amount of contingent interest, if any, payable by the Company.


 


Section 5.02 . Payment
of Contingent Interest. Contingent interest for any six-month interest period
shall be paid on the applicable interest payment date to the Person in whose
name any Note (or its Predecessor Note) is registered on the Note Register at
the corresponding Record Date. Contingent interest due under this Article 5
shall be treated for all purposes of this Indenture like any other interest
accruing on the Notes.


 


Section 5.03 .
Contingent Interest Notification. On or before the first Business Day of a
six-month interest period during which contingent interest will be paid, the
Company will disseminate a press release through Dow Jones & Company, Inc.
or Bloomberg Business News stating that contingent interest will be paid on the
Notes and identifying the six-month interest period.


 


ARTICLE 6

PARTICULAR COVENANTS OF THE COMPANY


 


Section 6.01 . Payment
of Principal, Premium and Interest. The Company covenants and agrees that it
will duly and punctually pay or cause to be paid when due the principal of
(including the redemption price upon redemption or the repurchase price upon
repurchase, in each case pursuant to Article 3), and premium, if any, and
interest on each of the Notes at the places, at the respective times and in the
manner provided herein and in the Notes. 


 


Section 6.02 . Maintenance
of Office or Agency. The Company will maintain an office or agency in the
Borough of Manhattan, The City of New York, where the Notes may be surrendered
for registration of transfer or exchange or for presentation for payment or for
conversion, redemption or repurchase and where notices and demands to or upon
the Company in respect of the Notes and this Indenture may be served. As of the
date of this Indenture, such office is located at U.S. Bank National
Association, 100 Wall Street, New York, NY 10005, Attention: Corporate Trust
Office and, at any other time, at such other address as the Trustee may
designate from time to time by notice to the Company. The Company will give
prompt written notice to the Trustee of the location, and any change in the location,
of such office or agency not designated or appointed by


 


22

















 


the Trustee. If at any time
the Company shall fail to maintain any such required office or agency or shall
fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office.


 


The Company may also from
time to time designate co-registrars and one or more offices or agencies where
the Notes may be presented or surrendered for any or all such purposes and may
from time to time rescind such designations. The Company will give prompt
written notice to the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency.


 


The Company hereby initially
designates the Trustee as Paying Agent, Note Registrar, Custodian and
conversion agent and the Corporate Trust Office shall be considered as one such
office or agency of the Company for each of the aforesaid purposes.


 


So long as the Trustee is
the Note Registrar, the Trustee agrees to mail, or cause to be mailed, the
notices set forth in Section 9.10(a) and the third paragraph of Section 9.11.
If co-registrars have been appointed in accordance with this Section, the
Trustee shall mail such notices only to the Company and the holders of Notes it
can identify from its records.


 


Section 6.03 .
Appointments to Fill Vacancies in Trustee’s Office. The Company, whenever
necessary to avoid or fill a vacancy in the office of Trustee, will appoint,
upon the terms and conditions and otherwise as provided in Section 9.10, a
Trustee, so that there shall at all times be a Trustee hereunder.


 


Section 6.04 .
Provisions as to Paying Agent. (a) If the Company shall appoint a Paying
Agent other than the Trustee, or if the Trustee shall appoint such a Paying
Agent, the Company will cause such Paying Agent to execute and deliver to the
Trustee an instrument in which such agent shall agree with the Trustee, subject
to the provisions of this Section 6.04:


 


(1) that it will hold
all sums held by it as such agent for the payment of the principal of and
premium, if any, or interest on the Notes (whether such sums have been paid to
it by the Company or by any other obligor on the Notes) in trust for the
benefit of the holders of the Notes;


 


(2) that it will give
the Trustee notice of any failure by the Company (or by any other obligor on
the Notes) to make any payment of the principal of and premium, if any, or
interest on the Notes when the same shall be due and payable; and


 


(3) that at any time
during the continuance of an Event of Default, upon request of the Trustee, it
will forthwith pay to the Trustee all sums so held in trust.


 


The Company shall, on or
before each due date of the principal of, premium, if any, or interest on the
Notes, deposit with the Paying Agent a sum (in funds which are immediately
available on the due date for such payment) sufficient to pay such principal,
premium, if any, or interest and (unless such Paying Agent is the Trustee) the
Company will promptly notify the Trustee of any failure to take such action;
provided that if such deposit is made on the due date, such deposit shall be
received by the Paying Agent by 11:00 a.m. New York City time, on such
date.


 


(b) If the Company
shall act as its own Paying Agent, it will, on or before each due date of the
principal of, premium, if any, or interest on the Notes, set aside, segregate
and hold in trust for the benefit of the holders of the Notes a sum sufficient
to pay such principal, premium, if any, and interest so becoming due and will
promptly notify the Trustee of any failure to take such action and of any
failure by the Company (or any other obligor under the Notes) to make any
payment of the principal of, premium, if any, or interest on the Notes when the
same shall become due and payable.


 


(c) Anything in this Section 6.04
to the contrary notwithstanding, the Company may, at any time, for the purpose
of obtaining a satisfaction and discharge of this Indenture, or for any other
reason, pay or cause to be paid to the Trustee all sums held in trust by the
Company or any Paying Agent hereunder as required by this Section 6.04,
such sums to be held by the Trustee upon the trusts herein contained and upon
such payment by the Company or any Paying Agent to the Trustee, the Company or
such Paying Agent shall be released from all further liability with respect to
such sums.


 


(d) Anything in this Section 6.04
to the contrary notwithstanding, the agreement to hold sums in trust as
provided in this Section 6.04 is subject to Section 13.02 and Section 13.03.


 


The Trustee shall not be
responsible for the actions of any other Paying Agents (including the Company
if acting as its own Paying Agent) and shall have no control of any funds held
by such other Paying Agents.


 


Section 6.05 .
Existence. Subject to Article 12, the Company will do or cause to be done
all things necessary to preserve and keep in full force and effect its
existence and rights (charter and statutory); provided that the Company shall
not be required to preserve any such right if the Company shall determine that
the preservation thereof is no longer desirable in the conduct of the business
of the Company and that the loss thereof is not disadvantageous in any material
respect to the Noteholders.


 


Section 6.06 . Payment
of Taxes and Other Claims. The Company will pay or discharge, or cause to be
paid or discharged, before the same may become delinquent, (i) all taxes,
assessments and governmental charges levied or imposed upon the Company or any
Significant Subsidiary or upon the income, profits or property of the Company
or any Significant Subsidiary, (ii) all claims for labor, materials and
supplies which, if


 


23

















 


unpaid, might by law become
a lien or charge upon the property of the Company or any Significant Subsidiary
and (iii) all stamp taxes and other duties, if any, which may be imposed
by the United States or any political subdivision thereof or therein in connection
with the issuance, transfer, exchange, conversion, redemption or repurchase of
any Notes or with respect to this Indenture; provided that, in the case of
clauses (i) and (ii), the Company shall not be required to pay or
discharge or cause to be paid or discharged any such tax, assessment, charge or
claim (A) if the failure to do so will not, in the aggregate, have a
material adverse impact on the Company, or (B) if the amount,
applicability or validity is being contested in good faith by appropriate proceedings.


 


Section 6.07 . Rule 144A
Information Requirement. Within the period prior to the expiration of the
holding period applicable to sales thereof under Rule 144(k) under
the Securities Act (or any successor provision), the Company covenants and agrees
that it shall, during any period in which it is not subject to Section 13
or 15(d) under the Exchange Act, make available to any holder or
beneficial holder of Notes or any Common Stock issued upon conversion thereof
which continue to be Restricted Securities in connection with any sale thereof
and any prospective purchaser of Notes or such Common Stock designated by such
holder or beneficial holder, the information required pursuant to Rule 144A(d)(4) under
the Securities Act upon the request of any holder or beneficial holder of the
Notes or such Common Stock, all to the extent required to enable such holder or
beneficial holder to sell its Notes or Common Stock without registration under
the Securities Act within the limitation of the exemption provided by Rule 144A.


 


Section 6.08 . Stay,
Extension and Usury Laws. The Company covenants (to the extent that it may
lawfully do so) that it shall not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay,
extension or usury law or other law which would prohibit or forgive the Company
from paying all or any portion of the principal, premium, if any, or interest
on the Notes as contemplated herein, wherever enacted, now or at any time
hereafter in force, or which may affect the covenants or the performance of
this Indenture and the Company (to the extent it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that
it will not, by resort to any such law, hinder, delay or impede the execution
of any power herein granted to the Trustee, but will suffer and permit the
execution of every such power as though no such law had been enacted.


 


Section 6.09 .
Compliance Certificate. The Company shall deliver to the Trustee, within one
hundred twenty calendar days after the end of each fiscal year of the Company,
a certificate signed by either the principal executive officer, principal
financial officer or principal accounting officer of the Company, stating
whether or not to the knowledge of the signer thereof the Company is in default
in the performance and observance of any of the terms, provisions and
conditions of this Indenture (without regard to any period of grace or
requirement of notice provided hereunder) and, if the Company shall be in
default, specifying all such defaults and the nature and the status thereof of
which the signer may have knowledge.


 


The Company will deliver to
the Trustee, promptly upon becoming aware of (i) any default in the
performance or observance of any covenant, agreement or condition contained in
this Indenture, or (ii) any Event of Default, an Officers’ Certificate
specifying with particularity such default or Event of Default and further
stating what action the Company has taken, is taking or proposes to take with
respect thereto.


 


Any notice required to be
given under this Section 6.09 shall be delivered to a Responsible Officer
of the Trustee at its Corporate Trust Office.


 


Section 6.10 Additional
Interest Notice. In the event that the Company is required to pay Additional
Interest to holders of Notes pursuant to the Registration Rights Agreement, the
Company will provide written notice (“Additional Interest Notice”) to the
Trustee of its obligation to pay Additional Interest no later than fifteen
calendar days prior to the proposed payment date for Additional Interest, and
the Additional Interest Notice shall set forth the amount of Additional
Interest to be paid by the Company on such payment date. The Trustee shall not
at any time be under any duty or responsibility to any holder of Notes to
determine the Additional Interest, or with respect to the nature, extent or
calculation of the amount of Additional Interest when made, or with respect to
the method employed in such calculation of the Additional Interest.


 


Section 6.11 . Tax
Treatment.


 


(a) The parties hereto
hereby agree, and each holder and any beneficial holder of a Note by its
purchase of a Note hereby agrees (in the absence of administrative
pronouncement or judicial ruling to the contrary):


 


(i) to treat the Notes
as indebtedness of the Company for all United States federal income tax
purposes;


 


(ii) to treat the Notes
as debt instruments that are subject to Treasury Regulation section
1.1275-4(b); and


 


(iii) to treat the delivery
of Common Stock or cash (including cash delivered in lieu of a fractional
share) to a holder of a Notes upon conversion of such Notes, or upon a
repurchase or redemption, as a contingent payment (in an amount equal to the
sum of the Fair Market Value of such Common Stock and any cash received) under
Treasury Regulation section 1.1275-4(b).


 


(b) Solely for purposes
of applying Treasury Regulation section 1.1275-4 to the Notes:


 


(i) for United States
federal income tax purposes, the Company shall accrue interest with respect to
outstanding Notes as original issue discount according to the “noncontingent
bond method,” as set forth in Treasury Regulation section 1.1275-4(b) using
a comparable yield of 7.79% compounded semi-annually and a projected payment schedule,
which a holder may obtain by telephoning Advanced Medical Optics, Inc.,
Investor Relations Department at (714) 247-8200 or submitting a written request
for it to the Company at the following address: Advanced Medical Optics, Inc.,
1700 E. St. Andrew Place, Santa Ana, California 92705; and


 


24

















 


(ii) the Company
acknowledges and agrees, and each holder and any beneficial holder of a Note,
by its purchase of a Note shall be deemed to acknowledge and agree, that (A) the
comparable yield and the projected payment schedule are determined on the basis
of an assumption of linear growth of stock price, (B) the comparable yield
and the projected payment schedule are not determined for any purpose other
than for the purpose of applying Treasury Regulation section 1.1275-4(b)(4) to
the Note, (C) the comparable yield and the projected payment schedule do
not constitute a projection or representation regarding the actual amounts
payable on the Notes, and (D) the Company’s application of Treasury
Regulation section 1.1275-4(b) shall be binding on each holder and any
beneficial holder of a Note, including the Company’s determination of the
comparable yield and the projected payment schedule.


 


Section 6.12 .
Limitation on Layering. The Company shall not incur any Indebtedness that is
contractually senior in right of payment to the Notes and contractually
subordinate in right of payment to any other Indebtedness of the Company.


 


ARTICLE 7

NOTEHOLDERS’ LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE


 


Section 7.01 .
Noteholders’ Lists. The Company covenants and agrees that it will furnish or
cause to be furnished to the Trustee, semi-annually, not more than fifteen
calendar days after each January 1 and July 1 in each year beginning
with January 1, 2005, and at such other times as the Trustee may
reasonably request in writing, within thirty calendar days after receipt by the
Company of any such request (or such lesser time as the Trustee may reasonably
request in order to enable it to timely provide any notice to be provided by it
hereunder), a list in such form as the Trustee may reasonably require of the
names and addresses of the holders of Notes as of a date not more than fifteen
calendar days (or such other date as the Trustee may reasonably request in
order to so provide any such notices) prior to the time such information is
furnished, except that no such list need be furnished by the Company to the
Trustee so long as the Trustee is acting as the sole Note Registrar.


 


Section 7.02 .
Preservation and Disclosure of Lists. (a) The Trustee shall preserve, in
as current a form as is reasonably practicable, all information as to the names
and addresses of the holders of Notes contained in the most recent list
furnished to it as provided in Section 7.01 or maintained by the Trustee
in its capacity as Note Registrar or co-registrar in respect of the Notes, if
so acting. The Trustee may destroy any list furnished to it as provided in Section 7.01
upon receipt of a new list so furnished.


 


(b) The rights of
Noteholders to communicate with other holders of Notes with respect to their
rights under this Indenture or under the Notes, and the corresponding rights
and duties of the Trustee, shall be as provided by the Trust Indenture Act.


 


(c) Every Noteholder
agrees with the Company and the Trustee that neither the Company nor the
Trustee nor any agent of either of them shall be held accountable by reason of
any disclosure of information as to names and addresses of holders of Notes
made pursuant to the Trust Indenture Act.


 


Section 7.03 . Reports
by Trustee. (a) Within sixty calendar days after May 15 of each year
commencing with the year 2005, the Trustee shall transmit to holders of Notes
such reports dated as of May 15 of the year in which such reports are made
concerning the Trustee and its actions under this Indenture as may be required
pursuant to the Trust Indenture Act at the times and in the manner provided
pursuant thereto. In the event that no events have occurred under the applicable
sections of the Trust Indenture Act the Trustee shall be under no duty or
obligation to provide such reports.


 


(b) A copy of such
report shall, at the time of such transmission to holders of Notes, be filed by
the Trustee with each stock exchange and automated quotation system, if any,
upon which the Notes are listed and with the Company. The Company will promptly
notify the Trustee in writing if the Notes are listed on any stock exchange or
automated quotation system or delisted therefrom.


 


Section 7.04 . Reports
by Company. The Company shall deliver to the Trustee (and the Commission if at
any time after the Indenture becomes qualified under the Trust Indenture Act),
and the Trustee shall deliver to holders of Notes, such information, documents
and other reports and such summaries thereof, as may be required pursuant to
the Trust Indenture Act at the times and in the manner provided pursuant to the
Trust Indenture Act, whether or not the Notes are governed by such Act;
provided that any such information, documents or reports required to be filed
with the Commission pursuant to Section 13 or 15(d) of the Exchange
Act shall be delivered to the Trustee within fifteen calendar days after the
same is so required to be filed with the Commission. Delivery of such reports,
information and documents to the Trustee is for informational purposes only and
the Trustee’s receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including the Company’s compliance with any of its covenants hereunder
(as to which the Trustee is entitled to rely exclusively on an Officers’
Certificates).


 


ARTICLE 8

REMEDIES OF THE TRUSTEE AND NOTEHOLDERS ON AN EVENT OF DEFAULT


 


Section 8.01 . Events
of Default. In case one or more of the following Events of Default (whatever
the reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body) shall have occurred and be continuing:


 


(a) default in the
payment of any installment of interest upon any of the Notes as and when the
same shall be due and payable, and continuance of such default for a period of
thirty calendar days, whether or not the payment is prohibited by Article 4;
or


 


25

















 


(b) default in the
payment of the principal of any of the Notes as and when the same shall be due
and payable at maturity, by acceleration or otherwise, or default in the
payment of the redemption price or the repurchase price in connection with any
redemption or repurchase pursuant to Article 3, or default in the payment
of the Make Whole Premium, if any, upon repurchase pursuant to Section 3.05
or conversion pursuant to Section 15.01(a)(vi), in each case, whether or
not the payment is prohibited by Article 4; or


 


(c) the Company fails
to provide on a timely basis a Company Repurchase Notice after the occurrence
of a Fundamental Change as provided in Section 3.07(d); or


 


(d) failure on the part
of the Company to observe or perform any other of the covenants or agreements
on the part of the Company in the Notes or in this Indenture (other than a covenant
or agreement a default in whose performance or whose breach is elsewhere in
this Section 8.01 specifically dealt with) and such failure continues for
a period of sixty calendar days after the date on which written notice of such
failure, requiring the Company to remedy the same, shall have been given to the
Company by the Trustee, or to the Company and a Responsible Officer of the
Trustee by the holders of at least twenty-five percent (25%) in aggregate
principal amount of the Notes at the time outstanding; or


 


(e) the Company shall
default in the payment of principal when due upon acceleration of other
Indebtedness of the Company for borrowed money where the aggregate principal
amount with respect to which the acceleration has occurred exceeds $25.0
million and such other Indebtedness has not been discharged, or such
acceleration has not been rescinded, stayed or annulled within a period of 30
calendar days after written notice of such failure, requiring the Company to
remedy the same, shall have been given to the Company by the Trustee, or to the
Company and a Responsible Officer of the Trustee by the holders of at least
twenty-five percent (25%) in aggregate principal amount of the Notes at the
time outstanding;


 


(f) the Company shall
commence a voluntary case or other proceeding seeking liquidation,
reorganization or other relief with respect to the Company or its debts under
any bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or other
similar official of the Company or any substantial part of the property of the
Company, or shall consent to any such relief or to the appointment of or taking
possession by any such official in an involuntary case or other proceeding
commenced against the Company, or shall make a general assignment for the
benefit of creditors, or shall fail generally to pay its debts as they become
due; or


 


(g) an involuntary case
or other proceeding shall be commenced against the Company seeking liquidation,
reorganization or other relief with respect to the Company or its debts under
any bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or other
similar official of the Company or any substantial part of the property of the
Company, and such involuntary case or other proceeding shall remain undismissed
and unstayed for a period of sixty consecutive calendar days;


 


then, and in each and every
such case (other than an Event of Default specified in Section 8.01 (f) and
(g)), unless the principal of all of the Notes shall have already become due
and payable, either the Trustee or the holders of at least than twenty-five
percent (25%) in aggregate principal amount of the Notes then outstanding, by
notice in writing to the Company (and to the Trustee if given by Noteholders),
may declare the principal of and premium, if any, and interest accrued and
unpaid on all the Notes to be due and payable, and upon any such declaration
the same shall be due and payable (i) immediately if there shall no longer
be a Senior Credit Facility or, (ii) if the Senior Credit Facility is in
effect, immediately upon the earlier to occur of (A) the date Indebtedness
under the Senior Credit Facility is declared accelerated and (B) the fifth
Business Day after written notice of the declaration of such acceleration has
been given to the agents under the Senior Credit Facility, anything in this
Indenture or in the Notes contained to the contrary notwithstanding. If an
Event of Default specified in Section 8.01(f) or Section 8.01(g) occurs,
the principal of and premium, if any, and interest accrued and unpaid on all
the Notes shall be immediately and automatically due and payable without
necessity of further action. If, at any time after the principal of and
premium, if any, and interest on the Notes shall have been so declared due and
payable, and before any judgment or decree for the payment of the monies due
shall have been obtained or entered as hereinafter provided, (a) the
Company shall pay or shall deposit with the Trustee a sum sufficient to pay (i) all
matured installments of interest upon all the Notes, (ii) the principal of
and premium, if any, on all the Notes which shall have become due otherwise
than by acceleration, (iii) interest on overdue installments of accrued
and unpaid interest (to the extent that payment of such interest is enforceable
under applicable law) and on such principal of and premium, if any, as provided
in Section 8.02, to the date of such payment or deposit and (iv) amounts
due to the Trustee pursuant to Section 9.06, and (b) any and all
defaults under this Indenture, other than the nonpayment of principal of and
premium, if any, and accrued and unpaid interest on the Notes which shall have
become due by such declaration of acceleration, shall have been cured or waived
pursuant to Section 8.07, then and in every such case the holders of a
majority in aggregate principal amount of the Notes then outstanding on behalf
of the holders of all of the Notes then outstanding, by written notice to the
Company and to the Trustee, may waive all defaults or Events of Default and
rescind and annul such declaration and its consequences subject to Section 8.07;
but no such waiver or rescission and annulment shall extend to or shall affect
any subsequent default or Event of Default, or shall impair any right
consequent thereon. The Company shall notify in writing a Responsible Officer
of the Trustee, promptly upon becoming aware thereof, of any Event of Default,
as provided in Section 6.09.


 


In case the Trustee shall
have proceeded to enforce any right under this Indenture and such proceedings
shall have been discontinued or abandoned because of such waiver or rescission
and annulment or for any other reason or shall have been determined adversely
to the Trustee, then and in every such case the Company, the holders of Notes,
and the Trustee shall be restored respectively to their several positions and
rights hereunder, and all rights, remedies and powers of the Company, the
holders of Notes, and the Trustee shall continue as though no such proceeding
had been taken.


 


26

















 


Section 8.02 . Payments
of Notes on Default; Suit Therefor. The Company covenants that in the case of
an Event of Default pursuant to Section 8.01(a) or 8.01(b), upon
demand of the Trustee, the Company will pay to the Trustee, for the benefit of
the holders of the Notes, (i) the whole amount that then shall be due and
payable on all such Notes for principal and premium, if any, or interest, as
the case may be, with interest upon the overdue principal and premium, if any,
and (to the extent that payment of such interest is enforceable under
applicable law) upon the overdue installments of accrued and unpaid interest at
the rate borne by the Notes, plus 1%, from the required payment date and, (ii) in
addition thereto, any amounts due the Trustee under Section 9.06. Until
such demand by the Trustee, the Company may pay the principal of and premium,
if any, and interest on the Notes to the registered holders, whether or not the
Notes are overdue.


 


In case the Company shall
fail forthwith to pay such amounts upon such demand, the Trustee, in its own
name and as trustee of an express trust, shall be entitled and empowered to
institute any actions or proceedings at law or in equity for the collection of
the sums so due and unpaid, and may prosecute any such action or proceeding to
judgment or final decree, and may enforce any such judgment or final decree
against the Company or any other obligor on the Notes and collect in the manner
provided by law out of the property of the Company or any other obligor on the
Notes wherever situated the monies adjudged or decreed to be payable.


 


In case there shall be
pending proceedings for the bankruptcy or for the reorganization of the Company
or any other obligor on the Notes under Title 11 of the United States Code, or
any other applicable law, or in case a receiver, assignee or trustee in
bankruptcy or reorganization, liquidator, sequestrator or similar official
shall have been appointed for or taken possession of the Company or such other
obligor, the property of the Company or such other obligor, or in the case of
any other judicial proceedings relative to the Company or such other obligor
upon the Notes, or to the creditors or property of the Company or such other
obligor, the Trustee, irrespective of whether the principal of the Notes shall
then be due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Trustee shall have made any demand pursuant to the
provisions of this Section 8.02, shall be entitled and empowered, by
intervention in such proceedings or otherwise, to file and prove a claim or
claims for the whole amount of principal, premium, if any, accrued and unpaid
interest in respect of the Notes, and, in case of any judicial proceedings, to
file such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and of the Noteholders
allowed in such judicial proceedings relative to the Company or any other
obligor on the Notes, its or their creditors, or its or their property, and to
collect and receive any monies or other property payable or deliverable on any
such claims, and to distribute the same after the deduction of any amounts due
the Trustee under Section 9.06, and to take any other action with respect
to such claims, including participating as a member of any official committee
of creditors, as it reasonably deems necessary or advisable, unless prohibited
by law or applicable regulations, and any receiver, assignee or trustee in
bankruptcy or reorganization, liquidator, custodian or similar official is
hereby authorized by each of the Noteholders to make such payments to the
Trustee, and, in the event that the Trustee shall consent to the making of such
payments directly to the Noteholders, to pay to the Trustee any amount due it
for reasonable compensation, expenses, advances and disbursements, including
counsel fees and expenses incurred by it up to the date of such distribution.
To the extent that such payment of reasonable compensation, expenses, advances
and disbursements out of the estate in any such proceedings shall be denied for
any reason, payment of the same shall be secured by a lien on, and shall be
paid out of, any and all distributions, dividends, monies, securities and other
property which the holders of the Notes may be entitled to receive in such
proceedings, whether in liquidation or under any plan of reorganization or
arrangement or otherwise.


 


All rights of action and of
asserting claims under this Indenture, or under any of the Notes, may be
enforced by the Trustee without the possession of any of the Notes, or the
production thereof at any trial or other proceeding relative thereto, and any
such suit or proceeding instituted by the Trustee shall be brought in its own
name as trustee of an express trust, and any recovery of judgment shall, after
provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the holders of the Notes.


 


In any proceedings brought
by the Trustee (and in any proceedings involving the interpretation of any
provision of this Indenture to which the Trustee shall be a party) the Trustee
shall be held to represent all the holders of the Notes, and it shall not be
necessary to make any holders of the Notes parties to any such proceedings.


 


Section 8.03 .
Application of Monies Collected by Trustee. Any monies collected by the Trustee
pursuant to this Article 8, shall be applied, subject to Article 4,
in the following order, at the date or dates fixed by the Trustee for the
distribution of such monies, upon presentation of the several Notes, and
stamping thereon the payment, if only partially paid, and upon surrender
thereof, if fully paid:


 


FIRST: To the payment of all
amounts due the Trustee under Section 9.06;


 


SECOND: In case the principal
of the outstanding Notes shall not have become due and be unpaid, to the
payment of accrued and unpaid interest, if any, on the Notes in default in the
order of the maturity of the installments of such interest, with interest (to
the extent that such interest has been collected by the Trustee) as provided in
Section 8.02 upon the overdue installments of interest at the annual rate
of 1% above the then applicable interest rate, such payments to be made ratably
to the Persons entitled thereto;


 


THIRD: In case the principal
of the outstanding Notes shall have become due, by declaration or otherwise,
and be unpaid to the payment of the whole amount then owing and unpaid upon the
Notes for principal and premium, if any, and interest, with interest on the overdue
principal and premium, if any, and (to the extent that such interest has been
collected by the Trustee) upon overdue installments of accrued and unpaid
interest, as provided in Section 8.02, and in case such monies shall be
insufficient to pay in full the whole amounts so due and unpaid upon the Notes,
then to the payment of such principal and premium, if any, and interest without
preference or priority of principal and premium, if any, over interest, or


 


27

















 


of interest over principal
and premium, if any, or of any installment of interest over any other
installment of interest, or of any Note over any other Note, ratably to the
aggregate of such principal and premium, if any, and accrued and unpaid interest;
and


 


FOURTH: To the payment of
the remainder, if any, to the Company or any other Person lawfully entitled
thereto.


 


Section 8.04 .
Proceedings by Noteholder. No holder of any Note shall have any right by virtue
of or by reference to any provision of this Indenture to institute any suit,
action or proceeding in equity or at law upon or under or with respect to this
Indenture, or for the appointment of a receiver, trustee, liquidator, custodian
or other similar official, or for any other remedy hereunder, except in the
case of a default in the payment of principal, premium, if any, or interest on
the Notes, unless (a) such holder previously shall have given to the
Trustee written notice of an Event of Default and of the continuance thereof,
as hereinbefore provided, (b) the holders of at least twenty-five percent
(25%) in aggregate principal amount of the Notes then outstanding shall have
made written request upon the Trustee to institute such action, suit or
proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable security or indemnity as it may require against the
costs, liabilities or expenses to be incurred therein or thereby, (c) the
Trustee for sixty calendar days after its receipt of such notice, request and
offer of indemnity, shall have neglected or refused to institute any such
action, suit or proceeding and (d) no direction inconsistent with such
written request shall have been given to the Trustee pursuant to Section 8.07;
it being understood and intended, and being expressly covenanted by the taker
and holder of every Note with every other taker and holder and the Trustee,
that no one or more holders of Notes shall have any right in any manner
whatever by virtue of or by reference to any provision of this Indenture to
affect, disturb or prejudice the rights of any other holder of Notes, or to
obtain or seek to obtain priority over or preference to any other such holder,
or to enforce any right under this Indenture, except in the manner herein provided
and for the equal, ratable and common benefit of all holders of Notes (except
as otherwise provided herein). For the protection and enforcement of this Section 8.04,
each and every Noteholder and the Trustee shall be entitled to such relief as
can be given either at law or in equity.


 


Notwithstanding any other
provision of this Indenture and any provision of any Note, the right of any
holder of any Note to receive payment of the principal of (including the
redemption price or repurchase price upon redemption or repurchase pursuant to Article 3)
and premium, if any, and accrued interest on such Note, on or after the
respective due dates expressed in such Note or in the event of redemption or
repurchase, or to institute suit for the enforcement of any such payment on or
after such respective dates against the Company shall not be impaired or
affected without the consent of such holder.


 


Anything contained in this
Indenture or the Notes to the contrary notwithstanding, the holder of any Note,
without the consent of either the Trustee or the holder of any other Note, in
its own behalf and for its own benefit, may enforce, and may institute and
maintain any proceeding suitable to enforce, its rights of conversion as
provided herein.


 


Section 8.05 .
Proceedings by Trustee. In case of an Event of Default, the Trustee may, in its
discretion, proceed to protect and enforce the rights vested in it by this
Indenture by such appropriate judicial proceedings as are necessary to protect
and enforce any of such rights, either by suit in equity or by action at law or
by proceeding in bankruptcy or otherwise, whether for the specific enforcement
of any covenant or agreement contained in this Indenture or in aid of the
exercise of any power granted in this Indenture, or to enforce any other legal
or equitable right vested in the Trustee by this Indenture or by law.


 


Section 8.06 . Remedies
Cumulative and Continuing. Except as provided in Section 2.06, all powers
and remedies given by this Article 8 to the Trustee or to the Noteholders
shall, to the extent permitted by law, be deemed cumulative and not exclusive
of any thereof or of any other powers and remedies available to the Trustee or
the holders of the Notes, by judicial proceedings or otherwise, to enforce the
performance or observance of the covenants and agreements contained in this
Indenture, and no delay or omission of the Trustee or of any holder of any of
the Notes to exercise any right or power accruing upon any default or Event of
Default occurring and continuing as aforesaid shall impair any such right or
power, or shall be construed to be a waiver of any such default or any
acquiescence therein, and, subject to the provisions of Section 8.04,
every power and remedy given by this Article 8 or by law to the Trustee or
to the Noteholders may be exercised from time to time, and as often as shall be
deemed expedient, by the Trustee or by the Noteholders.


 


Section 8.07 .
Direction of Proceedings and Waiver of Defaults by Majority of Noteholders. The
holders of a majority in aggregate principal amount of the Notes at the time
outstanding shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee; provided that (a) such
direction shall not be in conflict with any rule of law or with this
Indenture, (b) the Trustee may take any other action which is not
inconsistent with such direction, (c) the Trustee may decline to take any
action that would benefit some Noteholder to the detriment of other Noteholders
and (d) the Trustee may decline to take any action that would involve the
Trustee in personal liability. The holders of a majority in aggregate principal
amount of the Notes at the time outstanding may, on behalf of the holders of
all of the Notes, waive any past default or Event of Default hereunder and its
consequences except (i) a default in the payment of the principal of,
premium, if any, or interest on the Notes, (ii) a failure by the Company
to convert any Notes into Common Stock (or cash or a combination of Common
Stock and cash, if the Company so elects) as required by this Indenture, (iii) a
default in the payment of the redemption price on the redemption date pursuant
to Article 3, (iv) a default in the payment of the repurchase price
on the Fundamental Change Repurchase Date or the Repurchase Date pursuant to Article 3
or (v) a default in respect of a covenant or provisions hereof which under
Article 11 cannot be modified or amended without the consent of the
holders of all Notes then outstanding or each Note affected thereby. Upon any
such waiver, the Company, the Trustee and the holders of the Notes shall be
restored to their former positions and rights hereunder; but no such waiver
shall extend to any subsequent or other default or Event of Default or impair
any right consequent thereon. Whenever any default or Event of Default
hereunder shall have been waived as permitted by this Section 8.07, said


 


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default or Event of Default
shall for all purposes of the Notes and this Indenture be deemed to have been
cured and to be not continuing; but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.


 


Section 8.08 . Notice
of Defaults. The Trustee shall, within ninety calendar days after a Responsible
Officer of the Trustee has knowledge of the occurrence of a default, mail to
all Noteholders, as the names and addresses of such holders appear upon the
Note Register, notice of all defaults known to a Responsible Officer, unless
such defaults shall have been cured or waived before the giving of such notice;
provided that except in the case of default in the payment of the principal of,
or premium, if any, or interest on any of the Notes, the Trustee shall be
protected in withholding such notice if and so long as a trust committee of
directors and/or Responsible Officers of the Trustee in good faith determines
that the withholding of such notice is in the interests of the Noteholders.


 


Section 8.09 .
Undertaking to Pay Costs. All parties to this Indenture agree, and each holder
of any Note by his acceptance thereof shall be deemed to have agreed, that any
court may, in its discretion, require, in any suit for the enforcement of any
right or remedy under this Indenture, or in any suit against the Trustee for
any action taken or omitted by it as Trustee, the filing by any party litigant
in such suit of an undertaking to pay the costs of such suit and that such
court may in its discretion assess reasonable costs, including reasonable
attorneys’ fees and expenses, against any party litigant in such suit, having
due regard to the merits and good faith of the claims or defenses made by such
party litigant; provided that the provisions of this Section 8.09 (to the
extent permitted by law) shall not apply to any suit instituted by the Trustee,
to any suit instituted by any Noteholder, or group of Noteholders, holding in
the aggregate more than ten percent in principal amount of the Notes at the
time outstanding determined in accordance with Section 10.04, or to any
suit instituted by any Noteholder for the enforcement of the payment of the
principal of, or premium, if any, or interest on any Note on or after the due
date expressed in such Note or to any suit for the enforcement of the right to
convert any Note in accordance with the provisions of Article 15.


 


ARTICLE 9

THE TRUSTEE


 


Section 9.01 . Duties
and Responsibilities of Trustee. The Trustee, prior to the occurrence of an
Event of Default and after the curing of all Events of Default which may have
occurred, undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture. In case an Event of Default has
occurred (which has not been cured or waived), the Trustee shall exercise such
of the rights and powers vested in it by this Indenture, and use the same
degree of care and skill in their exercise, as a prudent person would exercise
or use under the circumstances in the conduct of his own affairs.


 


No provision of this
Indenture shall be construed to relieve the Trustee from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:


 


(a) prior to the
occurrence of an Event of Default and after the curing or waiving of all Events
of Default which may have occurred:


 


(i) the duties and
obligations of the Trustee shall be determined solely by the express provisions
of this Indenture and the Trust Indenture Act, and the Trustee shall not be
liable except for the performance of such duties and obligations as are
specifically set forth in this Indenture and no implied covenants or
obligations shall be read into this Indenture and the Trust Indenture Act
against the Trustee; and


 


(ii) in the absence of
bad faith and willful misconduct on the part of the Trustee, the Trustee may
conclusively rely as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture; but, in the case
of any such certificates or opinions which by any provisions hereof are
specifically required to be furnished to the Trustee, the Trustee shall be
under a duty to examine the same to determine whether or not they conform to
the requirements of this Indenture;


 


(b) the Trustee shall
not be liable for any error of judgment made in good faith by a Responsible
Officer or Officers of the Trustee, unless the Trustee was negligent in
ascertaining the pertinent facts;


 


(c) the Trustee shall
not be liable with respect to any action taken or omitted to be taken by it in
good faith in accordance with the written direction of the holders of not less
than a majority in principal amount of the Notes at the time outstanding
determined as provided in Section 10.04 relating to the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this Indenture;


 


(d) whether or not
therein provided, every provision of this Indenture relating to the conduct or
affecting the liability of, or affording protection to, the Trustee shall be
subject to the provisions of this Section;


 


(e) the Trustee shall
not be liable in respect of any payment (as to the correctness of amount,
entitlement to receive or any other matters relating to payment) or notice
effected by the Company or any Paying Agent (other than the Trustee) or any
records maintained by any co-registrar (other than the Trustee) with respect to
the Notes;


 


(f) if any party fails
to deliver a notice relating to an event the fact of which, pursuant to this
Indenture, requires notice to be sent to the Trustee, the Trustee may
conclusively rely on its failure to receive such notice as reason to act as if
no such event occurred unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless the Trustee has otherwise received written notice
thereof; and


 


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(g) the Trustee shall
not be deemed to have knowledge of any Event of Default hereunder unless a
Responsible Officer of the Trustee has actual knowledge thereof or unless the
Trustee shall have been notified in writing of such Event of Default by the
Company or a holder of Notes.


 


None of the provisions
contained in this Indenture shall require the Trustee to expend or risk its own
funds or otherwise incur personal financial liability in the performance of any
of its duties or in the exercise of any of its rights or powers, if there is
reasonable ground for believing that the repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.


 


Section 9.02
.. Reliance on Documents, Opinions, etc. Except as otherwise provided in Section 9.01:


 


(a) the Trustee may
conclusively rely and shall be protected in acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request, consent,
order, bond, debenture, note, coupon or other paper or document (whether in its
original or facsimile form) believed by it in good faith to be genuine and to
have been signed or presented by the proper party or parties;


 


(b) any request,
direction, order or demand of the Company mentioned herein shall be
sufficiently evidenced by an Officers’ Certificate (unless other evidence in
respect thereof be herein specifically prescribed); and any resolution of the
Board of Directors may be evidenced to the Trustee by a copy thereof certified
by the Secretary or an Assistant Secretary of the Company;


 


(c) the Trustee may
consult with counsel of its own selection and any advice or Opinion of Counsel
shall be full and complete authorization and protection in respect of any
action taken or omitted by it hereunder in good faith and in reliance on and in
accordance with such advice or Opinion of Counsel;


 


(d) the Trustee shall
be under no obligation to exercise any of the rights or powers vested in it by
this Indenture at the request, order or direction of any of the Noteholders
pursuant to the provisions of this Indenture, unless such Noteholders shall
have offered to the Trustee reasonable security or indemnity reasonably
satisfactory to it against the costs, expenses and liabilities which may be
incurred therein or thereby;


 


(e) the Trustee shall
not be bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture or other paper or document,
but the Trustee may make such further inquiry or investigation into such facts
or matters as it may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled to examine the books,
records and premises of the Company, personally or by agent or attorney; (f) the
Trustee may execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents or attorneys and the Trustee
shall not be responsible for any misconduct or negligence on the part of any
agent or attorney appointed by it with due care hereunder;


 


(g) the Trustee shall
not be liable for any action taken, suffered or omitted to be taken by it in
good faith and reasonably believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Indenture;


 


(h) the rights,
privileges, protections, immunities and benefits given to the Trustee,
including, without limitation, its right to be indemnified, are extended to,
and shall be enforceable by, the Trustee in each of its capacities hereunder,
and each agent, custodian and other Person employed to act hereunder;


 


(i) the Trustee may
request that the Company deliver an Officers’ Certificate setting forth the
names of individuals and/or titles of officers authorized at such time to take
specified actions pursuant to this Indenture, which Officers’ Certificate may
be signed by any person authorized to sign an Officers’ Certificate, including
any person specified as so authorized in any such certificate previously
delivered and not superseded; and


 


(j) any permissive
right or authority granted to the Trustee shall not be construed as a mandatory
duty.


 


Section 9.03 . No
Responsibility for Recitals, etc. The recitals contained herein and in the
Notes (except in the Trustee’s certificate of authentication) shall be taken as
the statements of the Company, and the Trustee assumes no responsibility for
the correctness of the same. The Trustee makes no representations as to the
validity or sufficiency of this Indenture or of the Notes. The Trustee shall
not be accountable for the use or application by the Company of any Notes or
the proceeds of any Notes authenticated and delivered by the Trustee in
conformity with the provisions of this Indenture.


 


Section 9.04 . Trustee,
Paying Agents, Conversion Agents or Registrar May Own Notes. The Trustee,
any Paying Agent, any conversion agent or Note Registrar, in its individual or
any other capacity, may become the owner or pledgee of Notes with the same
rights it would have if it were not Trustee, Paying Agent, conversion agent or
Note Registrar.


 


Section 9.05 . Monies
to be Held in Trust. Subject to the provisions of Section 13.02, all
monies received by the Trustee shall, until used or applied as herein provided,
be held in trust for the purposes for which they were received. Money held by
the Trustee in trust hereunder need not be segregated from other funds except
to the extent required by law. Except as otherwise provided herein, the Trustee
shall be under no liability for interest on any money received by it hereunder
except as may be agreed in writing from time to time by the Company and the
Trustee.


 


Section 9.06 .
Compensation and Expenses of Trustee. The Company covenants and agrees to pay
to the Trustee from time to time, and the Trustee shall be entitled to, such
compensation for all services rendered by it hereunder in any capacity (which
shall not be limited by any


 


30

















 


provision of law in regard
to the compensation of a trustee of an express trust) as mutually agreed to
from time to time in writing between the Company and the Trustee, and the
Company will pay or reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances reasonably incurred or made by the Trustee in
accordance with any of the provisions of this Indenture (including the
reasonable compensation and the reasonable expenses and disbursements of its
counsel and of all Persons not regularly in its employ) except any such
expense, disbursement or advance as may arise from its negligence, willful
misconduct, recklessness or bad faith. The Company also covenants to indemnify
the Trustee and any predecessor Trustee (or any officer, director or employee
of the Trustee), in any capacity under this Indenture and any authenticating
agent for, and to hold them harmless against, any and all loss, liability,
damage, claim or reasonable expense including taxes (other than taxes based on the
income of the Trustee) incurred without negligence, willful misconduct,
recklessness or bad faith on the part of the Trustee or such officers,
directors, employees or authenticating agent, as the case may be, and arising
out of or in connection with the acceptance or administration of this trust or
in any other capacity hereunder, including the reasonable costs and expenses of
defending themselves against any claim (whether asserted by the Company, any
holder or any other Person) of liability in the premises. The obligations of
the Company under this Section 9.06 to compensate or indemnify the Trustee
and to pay or reimburse the Trustee for reasonable expenses, disbursements and
advances shall be secured by a lien prior to that of the Notes upon all property
and funds held or collected by the Trustee as such, except funds held in trust
for the benefit of the holders of particular Notes. The obligation of the
Company under this Section shall survive the satisfaction and discharge of
this Indenture.


 


When the Trustee and its
agents and any authenticating agent incur expenses or render services after an
Event of Default specified in Section 8.01(d) or (e) with
respect to the Company occurs, the expenses and the compensation for the
services are intended to constitute reasonable expenses of administration under
any bankruptcy, insolvency or similar laws.


 


Section 9.07 . Officers’
Certificate as Evidence. Except as otherwise provided in Section 9.01,
whenever in the administration of the provisions of this Indenture the Trustee
shall deem it necessary or desirable that a matter be proved or established
prior to taking or omitting any action hereunder, such matter (unless other
evidence in respect thereof be herein specifically prescribed) may, in the
absence of gross negligence, bad faith, recklessness or willful misconduct on
the part of the Trustee, be deemed to be conclusively proved and established by
an Officers’ Certificate delivered to the Trustee.


 


Section 9.08 .
Conflicting Interests of Trustee. If the Trustee has or shall acquire a
conflicting interest within the meaning of the Trust Indenture Act, the Trustee
shall either eliminate such interest or resign, to the extent and in the manner
provided by, and subject to the provisions of, the Trust Indenture Act and this
Indenture.


 


Section 9.09 .
Eligibility of Trustee. There shall at all times be a Trustee hereunder which
shall be a Person that is eligible pursuant to the Trust Indenture Act to act
as such and has a combined capital and surplus of at least $50,000,000 (or if
such Person is a member of a bank holding company system, its bank holding
company shall have a combined capital and surplus of at least $50,000,000). If
such Person publishes reports of condition at least annually, pursuant to law
or to the requirements of any supervising or examining authority, then for the
purposes of this Section the combined capital and surplus of such Person
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. If at any time the Trustee shall cease
to be eligible in accordance with the provisions of this Section 9.09, it
shall resign immediately in the manner and with the effect hereinafter
specified in this Article.


 


Section 9.10 .
Resignation or Removal of Trustee.


 


(a) The Trustee may at
any time resign by giving written notice of such resignation to the Company and
to the holders of Notes. Upon receiving such notice of resignation, the Company
shall promptly appoint a successor trustee by written instrument, in duplicate,
executed by order of the Board of Directors, one copy of which instrument shall
be delivered to the resigning Trustee and one copy to the successor trustee. If
no successor trustee shall have been so appointed and have accepted appointment
sixty calendar days after the mailing of such notice of resignation to the
Noteholders, the resigning Trustee may, upon ten Business Days’ notice to the
Company and the Noteholders, appoint a successor identified in such notice or
may petition, at the expense of the Company, any court of competent
jurisdiction for the appointment of a successor trustee, or, if any Noteholder
who has been a bona fide holder of a Note or Notes for at least six months may,
subject to the provisions of Section 8.09, on behalf of itself and all
others similarly situated, petition any such court for the appointment of a
successor trustee. Such court may thereupon, after such notice, if any, as it
may deem proper and prescribe, appoint a successor trustee.


 


(b) In case at any time
any of the following shall occur:


 


(i) the Trustee shall
fail to comply with Section 9.08 after written request therefor by the
Company or by any Noteholder who has been a bona fide holder of a Note or Notes
for at least six months; or


 


(ii) the Trustee shall
cease to be eligible in accordance with the provisions of Section 9.09 and
shall fail to resign after written request therefor by the Company or by any
such Noteholder; or


 


(iii) the Trustee shall
become incapable of acting, or shall be adjudged a bankrupt or insolvent, or a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation;


 


31
















 


then, in any such case, the
Company may remove the Trustee and appoint a successor trustee by written
instrument, in duplicate, executed by order of the Board of Directors, one copy
of which instrument shall be delivered to the Trustee so removed and one copy
to the successor trustee, or, subject to the provisions of Section 8.09,
any Noteholder who has been a bona fide holder of a Note or Notes for at least
six months may, on behalf of itself and all others similarly situated, petition
any court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor trustee; provided that if no successor Trustee shall
have been appointed and have accepted appointment sixty calendar days after
either the Company or the Noteholders has removed the Trustee, or the Trustee
resigns, the Trustee so removed may petition, at the expense of the Company,
any court of competent jurisdiction for an appointment of a successor trustee.
Such court may thereupon, after such notice, if any, as it may deem proper and
prescribe, remove the Trustee and appoint a successor trustee.


 


(c) The holders of a
majority in aggregate principal amount of the Notes at the time outstanding may
at any time remove the Trustee and nominate a successor trustee which shall be
deemed appointed as successor trustee unless, within ten calendar days after
notice to the Company of such nomination, the Company objects thereto, in which
case the Trustee so removed or any Noteholder, or if such Trustee so removed or
any Noteholder fails to act, the Company, upon the terms and conditions and
otherwise as in Section 9.10(a) provided, may petition any court of
competent jurisdiction for an appointment of a successor trustee.


 


(d) Any resignation or
removal of the Trustee and appointment of a successor trustee pursuant to any
of the provisions of this Section 9.10 shall become effective upon
acceptance of appointment by the successor trustee as provided in Section 9.11.


 


(e) Notwithstanding the
replacement of the Trustee pursuant to this Section, the Company’s obligations
under Section 9.06 shall continue for the benefit of the retiring Trustee.


 


Section 9.11 .
Acceptance by Successor Trustee. Any successor trustee appointed as provided in
Section 9.10 shall execute, acknowledge and deliver to the Company and to
its predecessor trustee an instrument accepting such appointment hereunder, and
thereupon the resignation or removal of the predecessor trustee shall become
effective and such successor trustee, without any further act, deed or conveyance,
shall become vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with like effect as if originally named as trustee
herein; but, nevertheless, on the written request of the Company or of the
successor trustee, the trustee ceasing to act shall, upon payment of any amount
then due it pursuant to the provisions of Section 9.06, execute and
deliver an instrument transferring to such successor trustee all the rights and
powers of the trustee so ceasing to act. Upon request of any such successor
trustee, the Company shall execute any and all instruments in writing for more
fully and certainly vesting in and confirming to such successor trustee all
such rights and powers. Any trustee ceasing to act shall, nevertheless, retain
a lien upon all property and funds held or collected by such trustee as such,
except for funds held in trust for the benefit of holders of particular Notes,
to secure any amounts then due it pursuant to the provisions of Section 9.06.


 


No successor trustee shall
accept appointment as provided in this Section 9.11 unless, at the time of
such acceptance, such successor trustee shall be qualified under the provisions
of Section 9.08 and be eligible under the provisions of Section 9.09.


 


Upon acceptance of appointment
by a successor trustee as provided in this Section 9.11, the Company (or
the former trustee, at the written direction of the Company) shall mail or
cause to be mailed notice of the succession of such trustee hereunder to the
holders of Notes at their addresses as they shall appear on the Note Register.
If the Company fails to mail such notice within ten

(10) calendar days after acceptance of appointment by the successor
trustee, the successor trustee shall cause such notice to be mailed at the expense
of the Company.


 


Section 9.12 .
Succession by Merger. Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to all or substantially all of the
corporate trust business of the Trustee (including any trust created by this
Indenture), shall be the successor to the Trustee hereunder without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, provided that in the case of any corporation succeeding to all
or substantially all of the corporate trust business of the Trustee, such
corporation shall be qualified under the provisions of Section 9.08 and
eligible under the provisions of Section 9.09.


 


In case at the time such
successor to the Trustee shall succeed to the trusts created by this Indenture,
any of the Notes shall have been authenticated but not delivered, any such successor
to the Trustee may adopt the certificate of authentication of any predecessor
trustee or authenticating agent appointed by such predecessor trustee, and
deliver such Notes so authenticated; and in case at that time any of the Notes
shall not have been authenticated, any successor to the Trustee or any
authenticating agent appointed by such successor trustee may authenticate such
Notes in the name of the successor trustee; and in all such cases such
certificates shall have the full force that is provided in the Notes or in this
Indenture; provided that the right to adopt the certificate of authentication
of any predecessor Trustee or authenticate Notes in the name of any predecessor
Trustee shall apply only to its successor or successors by merger, conversion
or consolidation.


 


Section 9.13 .
Preferential Collection of Claims. If and when the Trustee shall be or become a
creditor of the Company (or any other obligor upon the Notes), the Trustee
shall be subject to the provisions of the Trust Indenture Act regarding the
collection of the claims against the Company (or any such other obligor).


 


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ARTICLE 10

THE NOTEHOLDERS


 


Section 10.01 . Action
by Noteholders. Whenever in this Indenture it is provided that the holders of a
specified percentage in aggregate principal amount of the Notes may take any
action (including the making of any demand or request, the giving of any
notice, consent or waiver or the taking of any other action), the fact that at the
time of taking any such action, the holders of such specified percentage have
joined therein may be evidenced (a) by any instrument or any number of
instruments of similar tenor executed by Noteholders in person or by agent or
proxy appointed in writing, or (b) by the record of the holders of Notes
voting in favor thereof at any meeting of Noteholders, or (c) by a
combination of such instrument or instruments and any such record of such a
meeting of Noteholders. Whenever the Company or the Trustee solicits the taking
of any action by the holders of the Notes, the Company or the Trustee may fix
in advance of such solicitation a date as the record date for determining
holders entitled to take such action. The record date shall be not more than
fifteen calendar days prior to the date of commencement of solicitation of such
action.


 


Section 10.02 . Proof
of Execution by Noteholders. Subject to the provisions of Sections 9.01 and
9.02, proof of the execution of any instrument by a Noteholder or its agent or
proxy shall be sufficient if made in accordance with such reasonable rules and
regulations as may be prescribed by the Trustee or in such manner as shall be
satisfactory to the Trustee. The holding of Notes shall be proved by the
registry of such Notes or by a certificate of the Note Registrar.


 


Section 10.03 .
Absolute Owners. The Company, the Trustee, any Paying Agent, any conversion
agent and any Note Registrar may deem the Person in whose name such Note shall
be registered upon the Note Register to be, and may treat it as, the absolute
owner of such Note (whether or not such Note shall be overdue and
notwithstanding any notation of ownership or other writing thereon made by any
Person other than the Company or any Note Registrar) for the purpose of receiving
payment of or on account of the principal of, premium, if any, and interest on
such Note, for conversion of such Note and for all other purposes; and neither
the Company nor the Trustee nor any Paying Agent nor any conversion agent nor
any Note Registrar shall be affected by any notice to the contrary. All such
payments so made to any holder for the time being, or upon his order, shall be
valid, and, to the extent of the sum or sums so paid, effectual to satisfy and
discharge the liability for monies payable upon any such Note.


 


Section 10.04 .
Company-Owned Notes Disregarded. In determining whether the holders of the
requisite aggregate principal amount of Notes have concurred in any direction,
consent, waiver or other action under this Indenture, Notes which are owned by
the Company or any other obligor on the Notes or any Affiliate of the Company
or any other obligor on the Notes shall be disregarded and deemed not to be
outstanding for the purpose of any such determination; provided that for the
purposes of determining whether the Trustee shall be protected in relying on
any such direction, consent, waiver or other action, only Notes which a
Responsible Officer knows are so owned shall be so disregarded. Notes so owned
which have been pledged in good faith may be regarded as outstanding for the
purposes of this Section 10.04 if the pledgee shall establish to the
satisfaction of the Trustee the pledgee’s right to vote such Notes and that the
pledgee is not the Company, any other obligor on the Notes or any Affiliate of
the Company or any such other obligor. In the case of a dispute as to such
right, any decision by the Trustee taken upon the advice of counsel shall be
full protection to the Trustee. Upon request of the Trustee, the Company shall
furnish to the Trustee promptly an Officers’ Certificate listing and
identifying all Notes, if any, known by the Company to be owned or held by or
for the account of any of the above described Persons, and, subject to Section 9.01,
the Trustee shall be entitled to accept such Officers’ Certificate as
conclusive evidence of the facts therein set forth and of the fact that all
Notes not listed therein are outstanding for the purpose of any such
determination.


 


Section 10.05 .
Revocation of Consents; Future Holders Bound. At any time prior to (but not
after) the evidencing to the Trustee, as provided in Section 10.01, of the
taking of any action by the holders of the percentage in aggregate principal
amount of the Notes specified in this Indenture in connection with such action,
any holder of a Note which is shown by the evidence to be included in the Notes
the holders of which have consented to such action may, by filing written
notice with the Trustee at its Corporate Trust Office and upon proof of holding
as provided in Section 10.02, revoke such action so far as concerns such
Note. Except as aforesaid, any such action taken by the holder of any Note
shall be conclusive and binding upon such holder and upon all future holders
and owners of such Note and of any Notes issued in exchange or substitution
therefor, irrespective of whether any notation in regard thereto is made upon
such Note or any Note issued in exchange or substitution therefor.


 


ARTICLE 11

SUPPLEMENTAL INDENTURES


 


Section 11.01 .
Supplemental Indentures Without Consent of Noteholders. The Company, when
authorized by the resolutions of the Board of Directors, and the Trustee may,
from time to time, and at any time enter into an indenture or indentures
supplemental without the consent of the holders of the Notes hereto for one or
more of the following purposes:


 


(a) make provision with
respect to the conversion rights of the holders of Notes and the repurchase
obligations of the Company in connection with a Fundamental Change pursuant to
the requirements of Section 15.06;


 


(b) to convey,
transfer, assign, mortgage or pledge to the Trustee, as security for the Notes,
any property or assets;


 


(c) to evidence the
succession of another Person to the Company, or successive successions, and the
assumption by the successor Person of the covenants, agreements and obligations
of the Company pursuant to Article 12;


 


(d) to add to the
covenants of the Company such further covenants, restrictions or conditions as
the Board of Directors and the Trustee shall consider to be for the benefit of
the holders of Notes, and to make the occurrence, or the occurrence and
continuance, of a default in any such additional covenants, restrictions or
conditions a default or an Event of Default permitting the enforcement of all
or any of the several remedies


 


33

















 


provided in this Indenture
as herein set forth; provided that in respect of any such additional covenant,
restriction or condition, such supplemental indenture may provide for a
particular period of grace after default (which period may be shorter or longer
than that allowed in the case of other defaults) or may provide for an
immediate enforcement upon such default or may limit the remedies available to
the Trustee upon such default;


 


(e) surrender any right
or power herein conferred upon the Company;


 


(f) to cure any
ambiguity or to correct or supplement any provision contained herein or in any
supplemental indenture that may be defective or inconsistent with any other
provision contained herein or in any supplemental indenture provided that such
action does not adversely affect the interests of the holders of the Notes in
any material respect;


 


(g) add or modify any
provisions herein with respect to matters or questions arising hereunder which
the Company may deem necessary or desirable and that shall not be inconsistent
with the provisions of this Indenture; provided, that such change or
modification pursuant to this clause (g) does not, in the good faith
determination of the Board of Directors (as evidenced by a resolution of the
Board of Directors), adversely affect the interests of the holders of the Notes
in any material respect;


 


(h) increase the
Conversion Rate; provided, however, that such increase in the Conversion Rate
shall not adversely affect the interests of the holders of the Notes (after
taking into account tax and other consequences of such increase);


 


(i) make any changes or
modifications necessary in connection with the registration of the Notes under
the Securities Act as contemplated in the Registration Rights Agreement;
provided that such change or modification pursuant to this clause (i) does
not adversely affect the interests of the holders of the Notes in any material
respect;


 


(j) to evidence and
provide for the acceptance of appointment hereunder by a successor Trustee with
respect to the Notes; or


 


(k) to modify,
eliminate or add to the provisions of this Indenture to such extent as shall be
necessary to effect or maintain the qualification of this Indenture under the
Trust Indenture Act, or under any similar federal statute hereafter enacted.


 


Upon the written request of
the Company, accompanied by a copy of the resolutions of the Board of Directors
certified by its Secretary or Assistant Secretary authorizing the execution of
any supplemental indenture, the Trustee is hereby authorized to join with the
Company in the execution of any such supplemental indenture, to make any
further appropriate agreements and stipulations that may be therein contained
and to accept the conveyance, transfer and assignment of any property
thereunder, but the Trustee shall not be obligated to, but may in its
discretion, enter into any supplemental indenture that affects the Trustee’s
own rights, duties or immunities under this Indenture or otherwise.


 


Any supplemental indenture
authorized by the provisions of this Section 11.01 may be executed by the
Company and the Trustee without the consent of the holders of any of the Notes
at the time outstanding, notwithstanding any of the provisions of Section 11.02.


 


Section 11.02 .
Supplemental Indenture With Consent of Noteholders. With the consent (evidenced
as provided in Article 10) of the holders of a majority in aggregate
principal amount of the Notes at the time outstanding, the Company, when
authorized by the resolutions of the Board of Directors, and the Trustee may,
from time to time and at any time, enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or any
supplemental indenture or modifying in any manner the rights of the holders of
the Notes; provided that no such supplemental indenture shall, without the
consent of the holder of each Note so affected:


 


(i) extend the fixed
maturity of any Note;


 


(ii) reduce the rate or
extend the time for payment of interest on any Note;


 


(iii) reduce the
principal amount of any Note or premium, if any, on any Note;


 


(iv) reduce any amount
payable on redemption or repurchase of any Note;


 


(v) impair the right of
any holder to institute suit for the payment of any Note;


 


(vi) make the principal
of any Note, premium, if any, on any Note or interest on any Note payable in
any coin or currency other than that provided in the Notes;


 


(vii) change the
obligation of the Company to redeem any Note called for redemption on a
redemption date in a manner adverse to the holders of Notes;


 


(viii) change the
obligation of the Company to repurchase any Note upon a Fundamental Change in a
manner adverse to the holders of Notes;


 


(ix) change the
obligation of the Company to repurchase any Note at the option of a holder on a
Repurchase Date in a manner adverse to the holders of Notes;


 


34

















 


(x) affect the right of
a holder to convert any Notes into Common Stock (or, if the Company so elects,
cash or a combination of cash and Common Stock) or to reduce the number of
shares of Common Stock or any other property receivable upon conversion
pursuant to the terms set forth herein, including Section 15.06;


 


(xi) modify any of the
provisions of this Section 11.02 or Section 8.07, except to increase
any such percentage or to provide that certain other provisions of this
Indenture cannot be modified or waived without the consent of the holder of
each Note so affected;


 


(xii) change any obligation
of the Company to maintain an office or agency in New York City as set forth in
Section 6.02;


 


(xiii) modify in any
material respect the subordination provisions in Article 4 in a manner
adverse to the holders; or


 


(xiv) reduce the aforesaid
percentage of Notes, the holders of which are required to consent to any such
supplemental indenture, without the consent of each holder of Notes so
affected.


 


Upon the written request of
the Company, accompanied by a copy of the resolutions of the Board of Directors
certified by the Company’s Secretary or Assistant Secretary authorizing the
execution of any such supplemental indenture, and upon the filing with the
Trustee of evidence of the consent of Noteholders as aforesaid, the Trustee
shall join with the Company in the execution of such supplemental indenture
unless such supplemental indenture affects the Trustee’s own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee may in
its discretion, but shall not be obligated to, enter into such supplemental
indenture.


 


It shall not be necessary
for the consent of the Noteholders under this Section 11.02 to approve the
particular form of any proposed supplemental indenture, but it shall be
sufficient if such consent shall approve the substance thereof.


 


Section 11.03 . Effect
of Supplemental Indenture. Any supplemental indenture executed pursuant to the
provisions of this Article 11 shall comply with the Trust Indenture Act,
as then in effect, provided that this Section 11.03 shall not require such
supplemental indenture or the Trustee to be qualified under the Trust Indenture
Act prior to the time, if ever, such qualification is in fact required under
the terms of the Trust Indenture Act or the Indenture has been qualified under
the Trust Indenture Act, nor shall it constitute any admission or
acknowledgment by any party to such supplemental indenture that any such
qualification is required prior to the time, if ever, such qualification is in
fact required under the terms of the Trust Indenture Act or the Indenture has
been qualified under the Trust Indenture Act. Upon the execution of any
supplemental indenture pursuant to the provisions of this Article 11, this
Indenture shall be and be deemed to be modified and amended in accordance
therewith and the respective rights, limitation of rights, obligations, duties
and immunities under this Indenture of the Trustee, the Company and the holders
of Notes shall thereafter be determined, exercised and enforced hereunder,
subject in all respects to such modifications and amendments and all the terms
and conditions of any such supplemental indenture shall be and be deemed to be
part of the terms and conditions of this Indenture for any and all purposes.


 


Section 11.04 .
Notation on Notes. Notes authenticated and delivered after the execution of any
supplemental indenture pursuant to the provisions of this Article 11 may
bear a notation in form approved by the Trustee as to any matter provided for
in such supplemental indenture. If the Company or the Trustee shall so
determine, new Notes so modified as to conform, in the opinion of the Trustee
and the Board of Directors, to any modification of this Indenture contained in
any such supplemental indenture may, at the Company’s expense, be prepared and
executed by the Company, authenticated by the Trustee (or an authenticating
agent duly appointed by the Trustee pursuant to Section 17.11) and
delivered in exchange for the Notes then outstanding, upon surrender of such
Notes then outstanding.


 


Section 11.05 .
Evidence of Compliance of Supplemental Indenture to be Furnished to Trustee.
Prior to entering into any supplemental indenture pursuant to this Article 11,
the Trustee shall be provided with an Officers’ Certificate and an Opinion of
Counsel as conclusive evidence that any supplemental indenture executed
pursuant hereto complies with the requirements of this Article 11 and is
otherwise authorized or permitted by this Indenture.


 


ARTICLE 12

CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE


 


Section 12.01 . Company
May Consolidate on Certain Terms. Subject to the provisions of Section 12.02,
the Company shall not, in a single transaction or a series of related
transactions, consolidate or merge with or into any other Person or Persons
(whether or not affiliated with the Company), nor shall the Company sell,
convey, transfer or lease the property and assets of the Company substantially
as an entirety, to any other Person (whether or not affiliated with the
Company), unless: (i) the Company is the continuing corporation, or the
resulting, surviving or transferee Person (if other than the Company) is a
corporation or limited liability company organized and existing under the laws
of the United States of America, any state thereof or the District of Columbia;

(ii) upon any such consolidation, merger, sale, conveyance, transfer or
lease, the due and punctual payment of the principal of, and premium, if any,
and interest on all of the Notes, and the due and punctual performance and
observance of all of the covenants and conditions of this Indenture to be
performed or satisfied by the Company, shall be expressly assumed by a
supplemental indenture reasonably satisfactory in form to the Trustee and all
of the obligations of the Company under the Registration Rights Agreement shall
be expressly assumed by a supplemental agreement, in each case, executed and
delivered to the Trustee by the Person (if other than the Company) formed by such
consolidation, or into


 


35

















 


which the Company shall have
been merged, or by the Person that shall have acquired or leased such property,
and such supplemental indenture shall provide for the applicable conversion
rights set forth in Section 15.06; (iii) immediately after giving
effect to the transaction described above, no default or Event of Default, has
occurred and is continuing; and (iv) the Company has delivered to the
Trustee the Officers’ Certificate and Opinion of Counsel, if any, requested
pursuant to Section 12.03.


 


Section 12.02 .
Successor to be Substituted. In case of any such consolidation, merger, sale,
conveyance, transfer or lease in which the Company is not the continuing
corporation and upon the assumption by the successor Person, by supplemental
indenture, executed and delivered to the Trustee and reasonably satisfactory in
form to the Trustee, of the due and punctual payment of the principal of, and
premium, if any, and interest on all of the Notes, and the due and punctual
performance and observance of all of the covenants and conditions of this
Indenture to be performed or satisfied by the Company, and by supplemental
agreement, executed and delivered to the Trustee and reasonably satisfactory in
form to the Trustee, of all of the obligations of the Company under the
Registration Rights Agreement, such successor Person shall succeed to and be
substituted for the Company, with the same effect as if it had been named
herein as the party of this first part, and Advanced Medical Optics, Inc.
shall be discharged from its obligations under the Notes, this Indenture and
the Registration Rights Agreement. Such successor Person thereupon may cause to
be signed, and may issue either in its own name or in the name of Advanced
Medical Optics, Inc. any or all of the Notes, issuable hereunder that
theretofore shall not have been signed by the Company and delivered to the
Trustee; and, upon the order of such successor Person instead of the Company
and subject to all the terms, conditions and limitations in this Indenture
prescribed, the Trustee shall authenticate and shall deliver, or cause to be
authenticated and delivered, any Notes that previously shall have been signed
and delivered by the officers of the Company to the Trustee for authentication,
and any Notes that such successor Person thereafter shall cause to be signed
and delivered to the Trustee for that purpose. All the Notes so issued shall in
all respects have the same legal rank and benefit under this Indenture as the
Notes theretofore or thereafter issued in accordance with the terms of this
Indenture as though all of such Notes had been issued at the date of the
execution hereof. In the event of any such consolidation, merger, sale, conveyance,
transfer or lease, upon compliance with this Article 12 the Person named
as the “Company” in the first paragraph of this Indenture or any successor that
shall thereafter have become such in the manner prescribed in this Article 12
may be dissolved, wound up and liquidated at any time thereafter and such
Person shall be discharged from its liabilities as obligor and maker of the
Notes and from its obligations under this Indenture.


 


In case of any such
consolidation, merger, sale, conveyance, transfer or lease, such changes in
phraseology and form (but not in substance) may be made in the Notes thereafter
to be issued as may be appropriate.


 


Section 12.03 . Opinion
of Counsel to be Given Trustee. Prior to execution of any supplemental
indenture pursuant to this Article 12, if so requested by the Trustee, the
Trustee shall receive an Officers’ Certificate and an Opinion of Counsel as
conclusive evidence that any such consolidation, merger, sale, conveyance,
transfer or lease and any such assumption complies with the provisions of this Article 12.


 


ARTICLE 13

SATISFACTION AND DISCHARGE OF INDENTURE


 


Section 13.01 .
Discharge of Indenture. When (a) the Company shall deliver to the Trustee
for cancellation all Notes theretofore authenticated (other than any Notes that
have been destroyed, lost or stolen and in lieu of or in substitution for which
other Notes shall have been authenticated and delivered) and not theretofore
canceled, or (b) all the Notes not theretofore canceled or delivered to
the Trustee for cancellation shall have become due and payable, or are by their
terms to become due and payable within one year or are to be called for
redemption within one year under arrangements satisfactory to the Trustee for
the giving of notice of redemption, and the Company shall deposit with the
Trustee, in trust, funds sufficient to pay at maturity or upon redemption all
of the Notes (other than any Notes that shall have been mutilated, destroyed,
lost or stolen and in lieu of or in substitution for which other Notes shall
have been authenticated and delivered) not theretofore canceled or delivered to
the Trustee for cancellation, including principal and premium, if any, and
interest due or to become due to such date of maturity or redemption date, as
the case may be, accompanied by a verification report, as to the sufficiency of
the deposited amount, from an independent certified accountant or other
financial professional satisfactory to the Trustee, and if the Company shall
also pay or cause to be paid all other sums payable hereunder by the Company,
then this Indenture shall cease to be of further effect (except as to remaining
rights of registration of transfer, substitution and exchange and conversion of
Notes, rights hereunder of Noteholders to receive payments of principal of and
premium, if any, and interest on the Notes and the other rights, duties and
obligations of Noteholders, as beneficiaries hereof with respect to the
amounts, if any, so deposited with the Trustee and (iii) the rights,
obligations and immunities of the Trustee hereunder), and the Trustee, on
written demand of the Company accompanied by an Officers’ Certificate and an
Opinion of Counsel as required by Section 17.05 and at the cost and
expense of the Company, shall execute proper instruments acknowledging
satisfaction of and discharging this Indenture; the Company, however, hereby
agrees to reimburse the Trustee for any costs or expenses thereafter reasonably
and properly incurred by the Trustee and to compensate the Trustee for any
services thereafter reasonably and properly rendered by the Trustee in
connection with this Indenture or the Notes.


 


Section 13.02 .
Deposited Monies to be Held in Trust by Trustee. Subject to Section 13.04,
all monies deposited with the Trustee pursuant to Section 9.05, shall be
held in trust for the sole benefit of the Noteholders, and such monies shall be
applied by the Trustee to the payment, either directly or through any Paying
Agent (including the Company if acting as its own Paying Agent), to the holders
of the particular Notes for the payment or redemption of which such monies have
been deposited with the Trustee, of all sums due and to become due thereon for
principal, premium, if any, and interest. Moneys so held in trust shall not be
subject to the provisions of Article 4. All moneys deposited with the
Trustee pursuant to Section 9.05 (and held by it or any Paying Agent) for
the payment of Notes subsequently converted shall be returned to the Company
upon request. The Trustee is not responsible to anyone for interest on any
deposited funds except as agreed in writing.


 


36

















 


Section 13.03 . Paying
Agent to Repay Monies Held. Upon the satisfaction and discharge of this
Indenture, all monies then held by any Paying Agent (other than the Trustee)
shall, upon written request of the Company, be repaid to it or paid to the
Trustee, and thereupon such Paying Agent shall be released from all further
liability with respect to such monies.


 


Section 13.04 . Return
of Unclaimed Monies. Subject to the requirements of applicable law, any monies
deposited with or paid to the Trustee for payment of the principal of, premium,
if any, or interest on Notes and not applied but remaining unclaimed by the
holders of Notes for two years after the date upon which the principal of,
premium, if any, or interest on such Notes, as the case may be, shall have
become due and payable, shall be repaid to the Company by the Trustee on demand
and all liability of the Trustee shall thereupon cease with respect to such
monies; and the holder of any of the Notes shall thereafter look only to the
Company for any payment that such holder may be entitled to collect unless an
applicable abandoned property law designates another Person.


 


Section 13.05 . Reinstatement.
If the Trustee or the Paying Agent is unable to apply any money in accordance
with Section 13.02 by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company’s obligations under this Indenture and the Notes shall
be revived and reinstated as though no deposit had occurred pursuant to Section 13.01
until such time as the Trustee or the Paying Agent is permitted to apply all
such money in accordance with Section 13.02; provided that if the Company
makes any payment of principal of or premium, if any, or interest on any Note
following the reinstatement of its obligations, the Company shall be subrogated
to the rights of the holders of such Notes to receive such payment from the
money held by the Trustee or Paying Agent.


 


ARTICLE 14

IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS


 


Section 14.01 .
Indenture and Notes Solely Corporate Obligations. No recourse for the payment
of the principal of or, premium, if any, or interest on any Note, or for any
claim based thereon or otherwise in respect thereof, and no recourse under or
upon any obligation, covenant or agreement of the Company in this Indenture or
in any supplemental indenture or in any Note, or because of the creation of any
indebtedness represented thereby, shall be had against any incorporator,
stockholder, member, manager, employee, agent, officer, director or subsidiary,
as such, past, present or future, of the Company or any of the Company’s
subsidiaries or of any successor thereto, either directly or through the
Company or any of the Company’s subsidiaries or any successor thereto, whether
by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise; it being expressly
understood that all such liability is hereby expressly waived and released as a
condition of, and as a consideration for, the execution of this Indenture and
the issue of the Notes.


 


ARTICLE 15

CONVERSION OF NOTES


 


Section 15.01 . Right
to Convert. Subject to and upon compliance with the provisions of this
Indenture, on or prior to the Trading Day immediately preceding July 15,
2024, the holder of any Note not previously redeemed or repurchased shall have
the right, at such holder’s option, to convert the principal amount of the
Note, or any portion of such principal amount which is a multiple of $1,000,
into fully paid and non-assessable shares of Common Stock (as such shares shall
then be constituted) (or cash or a combination of cash and Common Stock, if the
Company so elects) at the Conversion Rate in effect at such time, by surrender
of the Note so to be converted in whole or in part, together with any required
funds, under the circumstances described in this Section 15.01 and in the
manner provided in Section 15.02. The Notes shall be convertible only upon
the occurrence of one of the following events:


 


(i) during any Fiscal
Quarter commencing after September 24, 2004, if the Closing Sale Price of
a share of Common Stock for at least 20 Trading Days in the 30 consecutive
Trading-Day period ending on the last Trading Day of the immediately preceding
Fiscal Quarter exceeds 130% of the Conversion Price in effect on that 30th
Trading Day;


 


(ii) during the five
Business Days immediately following any five consecutive Trading-Day period in
which the Trading Price per $1,000 principal amount of the Notes for each day
of such five Trading-Day period was less than 95% of the product of the Closing
Sale Price of a share of Common Stock and the Conversion Rate in effect on each
such Trading Day; provided that a holder may not convert Notes in reliance on
this Section 15.01(a)(ii) after July 15, 2019, if, on any
Trading Day during such five Trading-Day period, the Closing Sale Price of a
share of Common Stock is between 100% and 130% of the Conversion Price in
effect on each such Trading Day;


 


(iii) if such Note has
been called for redemption, at any time on or after the date the Company
Repurchase Notice has been given until 5:00 p.m., New York City time, on
the Trading Day immediately preceding the redemption date;


 


(iv) as provided in Section (b) of
this Section 15.01;


 


(v) after the earlier
of (x) the date the Notes are rated by both Standard & Poor’s
Ratings Services, a division of The McGraw-Hill Companies, Inc., and its
successors (“S&P”) and Moody’s Investor Services and its successors (“Moody’s”)
and (y) 30 Business Days from the date the Notes are issued, during any
period in which the credit rating assigned to the Notes by S&P or Moody’s
is below CCC+ or Caa2, respectively, or if either or both of S&P or Moody’s
does not rate or no longer rates the Notes, or if either S&P or Moody’s
suspends or withdraws the rating assigned to the Notes; or


 


37

















 


(vi) if a Fundamental
Change occurs, at any time beginning 15 calendar days prior to the date
announced by the Company as the anticipated effective date of the Fundamental
Change and until and including the date which is 15 calendar days after the
date that is the Effective Date.


 


The Trustee (or other
conversion agent appointed by the Company) shall, on behalf of the Company,
determine on a daily basis during the time period specified in Section 15.01(a)(i) whether
the Notes shall be convertible as a result of the occurrence of an event
specified in clause (i) above and, if the Notes shall be so convertible,
the Trustee (or other conversion agent appointed by the Company) shall promptly
deliver to the Company and the Trustee (if the Trustee is not the conversion
agent) written notice thereof.


 


The Trustee (or other
conversion agent appointed by the Company) shall have no obligation to
determine the Trading Price under this Section 15.01(a)(ii) unless
the Company has requested that the Trustee make such a determination; and the
Company shall have no obligation to make such request unless so requested in
writing by a holder. If a holder submits such a request, the Company shall
instruct the Trustee (or other conversion agent) to determine the Trading Price
of the Notes beginning on the next Trading Day and on each successive Trading
Day until the Trading Price per $1,000 principal amount of Notes is greater
than or equal to 95% of the product of the Closing Sale Price of a share of
Common Stock and the Conversion Rate then in effect for five consecutive
Trading Days; provided that the Trustee shall be under no duty or obligation to
make the calculations described in Section 15.01(a)(ii) hereof or to
determine whether the Notes are convertible pursuant to such section. For the
avoidance of doubt, the Company shall make the calculations described in Section 15.01(a)(ii) using
the Trading Price provided by the Trustee.


 


The Trustee shall be
entitled at its sole discretion to consult with the Company and to request the
assistance of the Company in connection with the Trustee’s duties and
obligations pursuant to Section 15.01(a)(i) and Section 15.01(a)(ii) hereof
(including without limitation the calculation or determination of the
Conversion Price, the Closing Sale Price and the Trading Price), and the
Company agrees, if requested by the Trustee, to cooperate with, and provide
assistance to, the Trustee in carrying out its duties under this

Section 15.01; provided, however, that nothing contained herein shall be
construed to relieve the Trustee of its duties pursuant to Section 15.01(a)(i) and
Section 15.01(a)(ii) hereof.


 


(b) In addition, if:


 


(i) the Company
distributes to all holders of Common Stock rights or warrants entitling them
(for a period expiring within 45 calendar days of the record date for the
determination of the stockholders entitled to receive such distribution) to
subscribe for or purchase shares of Common Stock, at a price per share less
than the average of the Closing Sale Price of a share of Common Stock for the
ten Trading Days immediately preceding, but not including, the declaration date
for such distribution, or (B) the Company distributes to all holders of
Common Stock, cash or other assets, debt securities or rights to purchase its
securities, where the Fair Market Value of such distribution per share of
Common Stock exceeds 5% of the Closing Sale Price of a share of Common Stock on
the Trading Day immediately preceding the declaration date for such
distribution, then, in either case, the holders shall have the right to convert
Notes at any time on and after the date that the Company gives notice to the
holders of such distribution, which shall be not less than 20 calendar days
prior to the Ex-Dividend Time for such distribution, until the earlier of 5:00 p.m.,
New York City time, on the Business Day immediately preceding, but not
including, the Ex-Dividend Time or the date the Company publicly announces that
such distribution will not take place; provided that a holder of a Note may not
convert its Notes pursuant to this Section 15.01(b)(i) if the holder
will otherwise participate in such distribution without conversion as a result
of holding the Notes; or


 


(ii) the Company
consolidates with or merges with or into another Person or is a party to a
binding share exchange or conveys, transfers, sells, leases or otherwise
disposes of all or substantially all of its properties and assets in each case
pursuant to which the Common Stock would be converted into cash, securities
and/or other property, then the holders shall have the right to convert Notes
at any time beginning fifteen calendar days prior to the date announced by the
Company as the anticipated effective date of the transaction and until and
including the date that is fifteen calendar days after the date that is the
actual effective date of such transaction. The Board of Directors shall
determine the anticipated effective date of the transaction, and such
determination shall be conclusive and binding on the holders and shall be
publicly announced by the Company and posted on its web site not later than two
Business Day prior to such 15th day.


 


“Ex-Dividend Time” means,
with respect to any distribution on shares of Common Stock, the first date on
which the shares of Common Stock trade regular way on the principal securities
market on which the shares of Common Stock are then traded without the right to
receive such distribution.


 


(c) Whenever the Notes
shall become convertible pursuant to this Section 15.01, the Company or,
at the Company’s request, the Trustee in the name and at the expense of the
Company, shall notify the holders of the event triggering such convertibility
in the manner provided in Section 17.03, and the Company shall also
publicly announce such information and publish it on the Company’s web site.
Any notice so given shall be conclusively presumed to have been duly given,
whether or not the holder receives such notice.


 


(d) A Note in respect
of which a holder has delivered a Repurchase Notice exercising such holder’s
right to require the Company to repurchase such Note pursuant to Section 3.05
or 3.06 may be converted only if such Repurchase Notice is withdrawn in
accordance with Section 3.08 prior to 5:00 p.m., New York City time,
on the Business Day immediately preceding the Repurchase Date or the
Fundamental Change Repurchase Date, as applicable.


 


38

















 


(e) A holder of Notes
is not entitled to any rights of a holder of Common Stock until such holder has
converted his Notes to Common Stock, and only to the extent such Notes are
deemed to have been converted to Common Stock under this Article 15.


 


Section 15.02 .
Exercise of Conversion Right; Issuance of Common Stock on Conversion; No
Adjustment for Interest or Dividends. In order to exercise the conversion right
with respect to any Note in certificated form, the Company must receive at the
office or agency of the Company maintained for that purpose in the City of New
York or, at the option of such holder, the Corporate Trust Office, such Note
with the original or facsimile of the form entitled “Conversion Notice” on the
reverse thereof, duly completed and manually signed, together with such Notes
duly endorsed for transfer, accompanied by the funds, if any, required by this Section 15.02.
Such notice shall also state the name or names (with address or addresses) in
which the certificate or certificates for shares of Common Stock which shall be
issuable on such conversion shall be issued, and shall be accompanied by transfer
or similar taxes, if required pursuant to Section 15.07.


 


In order to exercise the
conversion right with respect to any interest in a Global Note, the beneficial
holder must complete, or cause to be completed, the appropriate instruction
form for conversion pursuant to the Depositary’s book-entry conversion program;
deliver, or cause to be delivered, by book-entry delivery an interest in such
Global Note; furnish appropriate endorsements and transfer documents if
required by the Company or the Trustee or conversion agent; and pay the funds,
if any, required by this Section 15.02 and any transfer taxes if required
pursuant to Section 15.07.


 


If the Company elects to
settle in Common Stock only, as promptly as practicable after satisfaction of
the requirements for conversion set forth above, subject to compliance with any
restrictions on transfer if shares issuable on conversion are to be issued in a
name other than that of the Noteholder (as if such transfer were a transfer of
the Note or Notes (or portion thereof) so converted), the Company shall issue
and shall deliver to such Noteholder at the office or agency maintained by the
Company for such purpose pursuant to Section 6.02, (i) a certificate
or certificates for the number of full shares of Common Stock issuable upon the
conversion of such Note or portion thereof as determined by the Company in
accordance with the provisions of Section 15.12 (or in the case of Notes
submitted for conversion in connection with a Fundamental Change pursuant to Section 15.01(a)(vi) on
or after the record date for receiving distributions in connection with the
Fundamental Change, or if earlier, the Effective Date, the kind and amount of
cash, securities and other assets or property which the holder would have
received if it had held the number of shares of Common Stock issuable upon
conversion of such Note or portion thereof prior to such record date or the
Effective Date; provided that if the determination date is the record date, the
holder shall receive the cash, securities or other assets or property on the
Effective Date), (ii) in the case of Notes submitted for conversion in
connection with a Fundamental Change pursuant to Section 15.01(a)(vi), if
the Make Whole Premium is greater than zero, cash in respect of any accrued but
unpaid interest to, but excluding, the Conversion Date, payable on the date the
shares of Common Stock or other consideration, as the case may be, are
delivered and (iii) cash or a check or cash in respect of any fractional
interest in respect of a share of Common Stock arising upon such conversion,
calculated by the Company as provided in Section 15.03. If the Company
elects to settle in cash or a combination of cash and Common Stock, the cash
and, if applicable, a certificate or certificates for the number of full shares
of Common Stock into which the Notes are converted (and cash in lieu of
fractional shares) will be delivered to such holder after satisfaction of the
requirements for conversion set forth above, in accordance with Section 15.12.
In case any Note of a denomination greater than $1,000 shall be surrendered for
partial conversion, and subject to Section 2.03, the Company shall execute
and the Trustee shall authenticate and deliver to the holder of the Note so
surrendered, without charge to the holder, a new Note or Notes in authorized
denominations in an aggregate principal amount equal to the unconverted portion
of the surrendered Note.


 


Each conversion shall be
deemed to have been effected as to any such Note (or portion thereof) on the
date on which the requirements set forth above in this Section 15.02 have
been satisfied as to such Note (or portion thereof) (the “Conversion Date”),
and the Person in whose name any certificate or certificates for shares of
Common Stock shall be issuable upon such conversion shall be deemed to have
become on said date the holder of record of the shares represented thereby;
provided that any such surrender on any date when the stock transfer books of
the Company shall be closed shall constitute the Person in whose name the
certificates are to be issued as the record holder thereof for all purposes on
the next succeeding day on which such stock transfer books are open, but such
conversion shall be at the Conversion Rate in effect on the Conversion Date.


 


Any Note or portion thereof
surrendered for conversion during the period from 5:00 p.m., New York City
time, on the Record Date for any interest payment date to 5:00 p.m., New
York City time, on the Business Day preceding the applicable interest payment
date shall be accompanied by payment, in immediately available funds or other
funds acceptable to the Company, of an amount equal to the interest otherwise
payable on such interest payment date on the principal amount being converted;
provided that no such payment need be made (1) if a holder converts its
Notes in connection with a redemption and the Company has specified a
redemption date that is after a Record Date and on or prior to the
corresponding interest payment date, (2) if a holder converts its Notes in
connection with a Fundamental Change and the Company has specified a
Fundamental Change Repurchase Date that is after a Record Date and on or prior
to the corresponding interest payment date or (3) to the extent of any
overdue interest, if any overdue interest exists at the time of conversion with
respect to such Note. Except as provided above in this Section 15.02 and Section 16.01,
no payment or other adjustment shall be made for interest accrued on any Note
converted or for dividends on any shares issued upon the conversion of such
Note as provided in this Article 15. If a holder exercises its conversion
right pursuant to Section 15.01(a)(vi) and the Make Whole Premium is
greater than zero, such holder shall be entitled to accrued and unpaid interest
on the converted Notes to, but excluding, the Conversion Date, which interest
shall be payable in cash. In addition, notwithstanding the foregoing, in the
case of Notes submitted for conversion in connection with a Fundamental Change,
such Notes shall continue to represent the right to receive the Make Whole
Premium, if any, payable pursuant to Article 16 until such Make Whole
Premium is so paid.


 


39

















 


Upon the conversion of an
interest in a Global Note, the Trustee (or other conversion agent appointed by
the Company), or the Custodian at the direction of the Trustee (or other
conversion agent appointed by the Company), shall make a notation on such
Global Note as to the reduction in the principal amount represented thereby.
The Company shall notify the Trustee in writing of any conversions of Notes
effected through any conversion agent other than the Trustee.


 


Except with respect to a
conversion of a Note in connection with a Fundamental Change pursuant to which a
Make Whole Premium will be payable, upon the conversion of a Note, the accrued
but unpaid interest and accrued Tax Original Issue Discount attributable to the
period from the issue date of the Note to the Conversion Date, with respect to
the converted Note, shall not be cancelled, extinguished or forfeited, but
rather shall be deemed to be paid in full to the holder thereof through
delivery of the Common Stock (together with the cash payment, if any in lieu of
fractional shares) in exchange for the Note being converted pursuant to the
provisions hereof; and the Fair Market Value of such shares of Common Stock
(together with any such cash payment in lieu of fractional shares) shall be
treated as issued, to the extent thereof, first in exchange for and in satisfaction
of our obligation to pay the principal amount of the converted Note, the
accrued but unpaid interest, and accrued Tax Original Issue Discount through
the Conversion Date from the issue date, and the balance, if any, of such fair
market value of such Common Stock (and any such cash payment) shall be treated
as issued in exchange for and in satisfaction of the right to convert the Note
being converted pursuant to the provisions hereof.


 


Section 15.03 . Cash
Payments in Lieu of Fractional Shares. No fractional shares of Common Stock or
scrip certificates representing fractional shares shall be issued upon
conversion of Notes. If more than one Note shall be surrendered for conversion
at one time by the same holder, the number of full shares that shall be
issuable upon conversion shall be computed on the basis of the aggregate
principal amount of the Notes (or specified portions thereof to the extent
permitted hereby) so surrendered. If any fractional share of stock would be
issuable upon the conversion of any Note or Notes, the Company shall make an
adjustment and payment therefor in cash to the holder of Notes at a price equal
to the Closing Sale Price on the last Trading Day immediately preceding the
Conversion Date.


 


Section 15.04 .
Conversion Rate. Each $1,000 principal amount of the Notes shall be convertible
into the number of shares of Common Stock specified in the form of Note (herein
called the “Conversion Rate”) attached as Exhibit A hereto, subject to
adjustment as provided in this Section 15.05.


 


Section 15.05 .
Adjustment of Conversion Rate. The Conversion Rate shall be adjusted from time
to time by the Company as follows:


 


(a) In case the Company
shall hereafter pay a dividend or make a distribution to all holders of the
outstanding Common Stock in shares of Common Stock, the Conversion Rate shall
be increased so that the same shall equal the rate determined by multiplying
the Conversion Rate in effect at the opening of business on the date following
the date fixed for the determination of stockholders entitled to receive such
dividend or other distribution by a fraction,


 


(i) the numerator of
which shall be the sum of the number of shares of Common Stock outstanding at
the close of business on the date fixed for the determination of stockholders
entitled to receive such dividend or other distribution plus the total number
of shares of Common Stock constituting such dividend or other distribution; and


 


(ii) the denominator of
which shall be the number of shares of Common Stock outstanding at the close of
business on the date fixed for such determination,


 


such increase to become
effective immediately after the opening of business on the day following the
date fixed for such determination. For the purpose of this paragraph (a), the
number of shares of Common Stock at any time outstanding shall not include
shares held in the treasury of the Company. The Company will not pay any
dividend or make any distribution on shares of Common Stock held in the
treasury of the Company. If any dividend or distribution of the type described
in this Section 15.05(a) is declared but not so paid or made, the
Conversion Rate shall again be adjusted to the Conversion Rate that would then
be in effect if such dividend or distribution had not been declared.


 


(b) In case the Company
shall issue rights or warrants to all holders of its outstanding shares of
Common Stock entitling them (for a period expiring within forty-five calendar
days after the date fixed for determination of stockholders entitled to receive
such rights or warrants) to subscribe for or purchase shares of Common Stock at
a price per share less than the Closing Sale Price on the Business Day
immediately preceding the date of announcement of such issuance of such rights
or warrants, the Conversion Rate shall be increased so that the same shall
equal the rate determined by multiplying the Conversion Rate in effect
immediately prior to the date fixed for determination of stockholders entitled
to receive such rights or warrants by a fraction,


 


(i) the numerator of
which shall be the number of shares of Common Stock outstanding on the date
fixed for determination of stockholders entitled to receive such rights or
warrants plus the total number of additional shares of Common Stock offered for
subscription or purchase, and


 


(ii) the denominator of
which shall be the sum of the number of shares of Common Stock outstanding at
the close of business on the date fixed for determination of stockholders
entitled to receive such rights or warrants plus the number of shares that the
aggregate offering price of the total number of shares so offered would
purchase at such Current Market Price.


 


Such adjustment shall be
successively made whenever any such rights or warrants are issued, and shall
become effective immediately after the opening of business on the day following
the date fixed for determination of stockholders entitled to receive such
rights or warrants; provided, that


 


40

















 


no adjustment to the
Conversion Rate shall be made if the holder will otherwise participate in such
distribution without conversion as a result of holding the Notes. To the extent
that shares of Common Stock are not delivered after the expiration of such
rights or warrants, the Conversion Rate shall be readjusted to the Conversion
Rate that would then be in effect had the adjustments made upon the issuance of
such rights or warrants been made on the basis of delivery of only the number
of shares of Common Stock actually delivered. If such rights or warrants are
not so issued, the Conversion Rate shall again be adjusted to be the Conversion
Rate that would then be in effect if such date fixed for the determination of
stockholders entitled to receive such rights or warrants had not been fixed. In
determining whether any rights or warrants entitle the holders to subscribe for
or purchase shares of Common Stock at less than such Current Market Price, and
in determining the aggregate offering price of such shares of Common Stock,
there shall be taken into account any consideration received by the Company for
such rights or warrants and any amount payable on exercise or conversion
thereof, the value of such consideration, if other than cash, to be determined
by the Board of Directors.


 


(c) In case outstanding
shares of Common Stock shall be subdivided into a greater number of shares of
Common Stock, the Conversion Rate in effect at the opening of business on the
day following the day upon which such subdivision becomes effective shall be
proportionately increased, and conversely, in case outstanding shares of Common
Stock shall be combined into a smaller number of shares of Common Stock, the
Conversion Rate in effect at the opening of business on the day following the
day upon which such combination becomes effective shall be proportionately
reduced, such increase or reduction, as the case may be, to become effective
immediately after the opening of business on the day following the day upon
which such subdivision or combination becomes effective.


 


(d) In case the Company
shall, by dividend or otherwise, distribute to all holders of Common Stock
shares of any class of capital stock of the Company or evidences of its
indebtedness or assets (including securities, but excluding (i) any rights
or warrants referred to in Section 15.05(b), (ii) any dividends or
distributions paid exclusively in cash, (iii) any dividends or
distributions referred to in Section 15.05(a) or (iv) any
dividends or distributions in connection with a reclassification,
consolidation, merger, binding share exchange or sale to which Section 15.06
applies (any of the foregoing hereinafter in this Section 15.05(d)) called
the “Securities”)), then, in each such case (unless the Company elects to
reserve such Securities for distribution to the Noteholders upon the conversion
of the Notes so that any such holder converting Notes will receive upon such
conversion, in addition to the shares of Common Stock to which such holder is
entitled, the amount and kind of such Securities which such holder would have received
if such holder had converted its Notes into Common Stock immediately prior to
the record date) the Conversion Rate shall be increased so that the same shall
be equal to the rate determined by multiplying the Conversion Rate in effect on
the record date with respect to such distribution by a fraction,


 


(i) the numerator of
which shall be the Current Market Price on such Record Date; and


 


(ii) the denominator of
which shall be the Current Market Price on such record date less the Fair
Market Value (as determined by the Board of Directors, whose determination
shall be conclusive, and described in a resolution of the Board of Directors)
on the record date of the portion of the Securities so distributed applicable
to one share of Common Stock,


 


such adjustment to become
effective immediately prior to the opening of business on the day following
such record date; provided that if the then Fair Market Value (as so
determined) of the portion of the Securities so distributed applicable to one
share of Common Stock is equal to or greater than the Current Market Price on
the record date, in lieu of the foregoing adjustment, adequate provision shall
be made so that each Noteholder shall have the right to receive upon conversion
the amount of Securities such holder would have received had such holder
converted each Note on the record date. If such dividend or distribution is not
so paid or made, the Conversion Rate shall again be adjusted to be the
Conversion Rate that would then be in effect if such dividend or distribution
had not been declared. If the Board of Directors determines the Fair Market
Value of any distribution for purposes of this Section 15.05(d) by
reference to the actual or when issued trading market for any securities, it
must in doing so consider the prices in such market over the same period used
in computing the Current Market Price on the applicable record date.


 


If the dividend or
distribution requiring an adjustment pursuant to this clause (d) consists
of capital stock of any class or series, or similar equity interests, of a
Subsidiary or other business unit of the Company, for purposes of making such
adjustment, (i) the Current Market Price shall be based on the average of
the Closing Sale Prices of such securities for the ten Trading Days commencing
on and including the fifth Trading Day after the date on which “ex-dividend
trading” commences for such distribution on The New York Stock Exchange or such
other national or regional exchange or market on which such securities are then
listed or quoted, and (ii) the Fair Market Value of such securities shall
be determined as provided herein, measured for the same period.


 


Rights or warrants
distributed by the Company to all holders of Common Stock entitling the holders
thereof to subscribe for or purchase shares of the Company’s capital stock
(either initially or under certain circumstances), which rights or warrants,
until the occurrence of a specified event or events (“Trigger Event”): (i) are
deemed to be transferred with such shares of Common Stock; (ii) are not
exercisable; and (iii) are also issued in respect of future issuances of
Common Stock, shall be deemed not to have been distributed for purposes of this
Section 15.05 (and no adjustment to the Conversion Rate under this Section 15.05
will be required) until the occurrence of the earliest Trigger Event, whereupon
such rights and warrants shall be deemed to have been distributed and an
appropriate adjustment (if any is required) to the Conversion Rate shall be
made under this Section 15.05(d). If any such right or warrant, including
any such existing rights or warrants distributed prior to the date of this
Indenture, are subject to events, upon the occurrence of which such rights or
warrants become exercisable to purchase different securities, evidences of
indebtedness or other assets, then the date of the occurrence of any and each
such event shall be deemed to be the date of distribution and record date with
respect to new rights or warrants with such rights (and a termination or
expiration of the existing rights or warrants without exercise by any of the
holders thereof). In addition, in the event of any distribution (or deemed
distribution) of rights or warrants, or any Trigger Event or other event (of
the type described in the preceding sentence) with respect thereto that was
counted for purposes of calculating a distribution amount for which an
adjustment to the Conversion Rate under this Section 15.05 was made, (1) in
the case of any such rights or warrants that shall


 


41

















 


all have been redeemed or
repurchased without exercise by any holders thereof, the Conversion Rate shall
be readjusted upon such final redemption or repurchase to give effect to such
distribution or Trigger Event, as the case may be, as though it were a cash
distribution, equal to the per share redemption or repurchase price received by
a holder or holders of Common Stock with respect to such rights or warrants
(assuming such holder had retained such rights or warrants), made to all
holders of Common Stock as of the date of such redemption or repurchase, and (2) in
the case of such rights or warrants that shall have expired or been terminated
without exercise by any holders thereof, the Conversion Rate shall be
readjusted as if such rights and warrants had not been issued.


 


No adjustment of the
Conversion Rate shall be made pursuant to this Section 15.05(d) in
respect of rights or warrants distributed or deemed distributed on any Trigger
Event to the extent that such rights or warrants are actually distributed, or
reserved by the Company for distribution to holders of Notes upon conversion by
such holders of Notes to Common Stock.


 


For purposes of this Section 15.05(d) and
Section 15.05(a) and (b), any dividend or distribution to which this Section 15.05(d) is
applicable that also includes shares of Common Stock, or rights or warrants to
subscribe for or purchase shares of Common Stock (or both), shall be deemed
instead to be (1) a dividend or distribution of the evidences of indebtedness,
assets or shares of capital stock other than such shares of Common Stock or
rights or warrants (and any Conversion Rate adjustment required by this Section 15.05(d) with
respect to such dividend or distribution shall then be made) immediately followed
by (2) a dividend or distribution of such shares of Common Stock or such
rights or warrants (and any further Conversion Rate adjustment required by
Sections 15.05(a) and 15.05(b) with respect to such dividend or
distribution shall then be made), except (A) the record date of such
dividend or distribution shall be substituted as “the date fixed for the
determination of stockholders entitled to receive such dividend or other
distribution”, “the date fixed for the determination of stockholders entitled
to receive such rights or warrants” and “the date fixed for such determination”
within the meaning of Section 15.05(a) and 15.05(b) and (B) any
shares of Common Stock included in such dividend or distribution shall not be
deemed “outstanding at the close of business on the date fixed for such
determination” within the meaning of Section 15.05(a).


 


(e) In case the Company
shall, by dividend or otherwise, distribute to all holders of its Common Stock
cash (including any quarterly cash dividend, but excluding (x) any
quarterly cash dividend distributed on or after January 20, 2010 on the
Common Stock to the extent the aggregate cash dividend per share of Common
Stock in any Fiscal Quarter does not exceed the greater of (A) the amount
per share of Common Stock of the next preceding quarterly cash dividend on the
Common Stock to the extent that such preceding quarterly dividend did not
require any adjustment of the Conversion Rate pursuant to this Section 15.05(e) (as
adjusted to reflect subdivisions or combinations of the Common Stock), and (B) 1.25%
of the average of the Closing Sale Price of a share of Common Stock over the
ten consecutive Trading Days immediately preceding the date of declaration of
such dividend calculated at the time of the declaration of each distribution
during such quarter, (y) any dividend or distribution in connection with
the liquidation, dissolution or winding up of the Company, whether voluntary or
involuntary, and (z) any dividend or distribution in connection with a
reclassification, consolidation, merger, binding share exchange or sale to
which Section 15.06 applies), then, in such case, the Conversion Rate
shall be increased so that the same shall equal the rate determined by
multiplying the Conversion Rate in effect on the applicable record date by a
fraction,


 


(i) the numerator of
which shall be the Current Market Price on such record date; and


 


(ii) the denominator of
which shall be the Current Market Price on such record date less (x) the
amount of the excess distribution in the case of a quarterly dividend on or
after January 20, 2010 or (y) the full amount of cash so distributed
(and not excluded as provided above) in all other cases, in each of (x) and
(y), as applicable to one share of Common Stock,


 


such adjustment to be effective
immediately prior to the opening of business on the day following the record
date; provided that if the portion of the cash so distributed applicable to one
share of Common Stock is equal to or greater than the Current Market Price on
the record date, in lieu of the foregoing adjustment, adequate provision shall
be made so that each Noteholder shall have the right to receive upon conversion
the amount of cash such holder would have received had such holder converted
each Note on the record date. If such dividend or distribution is not so paid
or made, the Conversion Rate shall again be adjusted to be the Conversion Rate
that would then be in effect if such dividend or distribution had not been
declared. If any adjustment is required to be made as set forth in this Section 15.05(e) as
a result of a distribution that is a quarterly dividend, such adjustment shall
be based upon the amount by which such distribution exceeds the amount of the
quarterly cash dividend permitted to be excluded pursuant hereto. If an
adjustment is required to be made as set forth in this Section 15.05(e) above
as a result of a distribution that is not a quarterly dividend, such adjustment
shall be based upon the full amount of the distribution.


 


Notwithstanding the
foregoing, adjustments to the Conversion Rate resulting from any quarterly cash
dividends may not cause the Conversion Rate (as adjusted for any other
adjustment in this Section 15.05) to exceed the quotient obtained by
dividing the principal amount of a Note by $37.49.


 


(f) In case a tender or
exchange offer made by the Company or any Subsidiary for all or any portion of
the Common Stock shall expire and such tender or exchange offer (as amended
upon the expiration thereof) shall require the payment to stockholders of consideration
per share of Common Stock having a Fair Market Value (as determined by the
Board of Directors, whose determination shall be conclusive and described in a
resolution of the Board of Directors) that as of the last time (the “Expiration
Time”) tenders or exchanges may be made pursuant to such tender or exchange
offer (as it may be amended) exceeds the Closing Sale Price of a share of
Common Stock on the Trading Day next succeeding the Expiration Time, the
Conversion Rate shall be increased so that the same shall equal the rate
determined by multiplying the Conversion Rate in effect immediately prior to
the Expiration Time by a fraction,


 


42
















 


(i) the numerator of
which shall be the sum of (x) the Fair Market Value (determined as
aforesaid) of the aggregate consideration payable to stockholders based on the
acceptance (up to any maximum specified in the terms of the tender or exchange
offer) of all shares validly tendered or exchanged and not withdrawn as of the
Expiration Time (the shares deemed so accepted up to any such maximum, being
referred to as the “Purchased Shares”) and (y) the product of the number
of shares of Common Stock outstanding (less any Purchased Shares) at the
Expiration Time and the Closing Sale Price of a share of Common Stock on the
Trading Day next succeeding the Expiration Time, and


 


(ii) the denominator of
which shall be the number of shares of Common Stock outstanding (including any
tendered or exchanged shares) at the Expiration Time multiplied by the Closing
Sale Price of a share of Common Stock on the Trading Day next succeeding the
Expiration Time,


 


such adjustment to become
effective immediately prior to the opening of business on the day following the
Expiration Time. If the Company is obligated to purchase shares pursuant to any
such tender or exchange offer, but the Company is permanently prevented by
applicable law from effecting any such purchases or all such purchases are
rescinded, the Conversion Rate shall again be adjusted to be the Conversion
Rate that would then be in effect if such tender or exchange offer had not been
made.


 


(g) For purposes of
this Section 15.05, the following terms shall have the meaning indicated:


 


(i) “Current Market
Price” shall mean the average of the daily Closing Sale Prices per share of
Common Stock over the ten consecutive Trading Days ending on the earlier of
such date of determination and the day before the “ex” date with respect to the
issuance, distribution, subdivision or combination requiring such computation.
For purpose of this paragraph, the term “ex” date, (1) when used with
respect to any issuance or distribution, means the first date on which the
Common Stock trades, regular way, on the relevant exchange or in the relevant
market from which the Closing Sale Price was obtained without the right to
receive such issuance or distribution, and (2) when used with respect to
any subdivision or combination of shares of Common Stock, means the first date
on which the Common Stock trades, regular way, on such exchange or in such
market after the time at which such subdivision or combination becomes
effective.


 


If another issuance,
distribution, subdivision or combination to which Section 15.05 applies
occurs during the period applicable for calculating “Current Market Price”
pursuant to the definition in the preceding paragraph, “Current Market Price”
shall be calculated for such period in a manner determined by the Board of
Directors to reflect the impact of such issuance, distribution, subdivision or
combination on the Closing Sale Price of the Common Stock during such period.


 


(ii) “Fair Market Value”
shall mean the amount which a willing buyer would pay a willing seller in an arm’s-length
transaction.


 


(iii) “record date”
shall mean, with respect to any dividend, distribution or other transaction or
event in which the holders of Common Stock have the right to receive any cash,
securities or other property or in which the Common Stock (or other applicable
security) is exchanged for or converted into any combination of cash,
securities or other property, the date fixed for determination of stockholders
entitled to receive such cash, securities or other property (whether such date
is fixed by the Board of Directors or by statute, contract or otherwise).


 


(iv) “Trading Day”
shall mean (x) if the applicable security is quoted on the Nasdaq National
Market, a day on which trades may be made thereon or (y) if the applicable
security is listed or admitted for trading on the New York Stock Exchange or
another national securities exchange, a day on which the New York Stock
Exchange or another national securities exchange is open for business or (z) if
the applicable security is not so listed, admitted for trading or quoted, any
day other than a Saturday or Sunday or a day on which banking institutions in
the State of New York are authorized or obligated by law or executive order to
close.


 


(h) The Company may
make such increases in the Conversion Rate, in addition to those required by Section 15.05(a)-(f) as
the Board of Directors considers to be advisable to avoid or diminish any
income tax to holders of Common Stock or rights to purchase Common Stock
resulting from any dividend or distribution of stock (or rights to acquire
stock) or from any event treated as such for income tax purposes.


 


To the extent permitted by
applicable law, the Company from time to time may increase the Conversion Rate
by any amount for any period of time if the period is at least twenty (20)
Business Days, the increase is irrevocable during the period and the Board of
Directors shall have made a determination that such increase would be in the
best interests of the Company, which determination shall be conclusive. Whenever
the Conversion Rate is increased pursuant to the preceding sentence, the
Company shall mail to holders of record of the Notes a notice of the increase,
and such notice shall state the increased Conversion Rate and the period during
which it will be in effect.


 


(i) No adjustment in
the Conversion Rate shall be required unless such adjustment would require an
increase or decrease of at least one percent (1%) in such rate; provided that
any adjustments that by reason of this Section 15.05(i) are not required
to be made shall be carried forward and the Company shall make such carry
forward adjustments, regardless of whether the aggregate adjustment is less
than 1%, within one year of the first such adjustment carry forward, upon
redemption, upon a Fundamental Change or at maturity. All calculations under
this Article 15 shall be made by the Company and shall be made to the
nearest cent or to the nearest one-ten thousandth (1/10,000) of a share, as the
case may be. No adjustment need be made for rights to purchase Common Stock
pursuant to a Company plan for reinvestment of dividends or interest or for any
issuance of Common Stock or convertible or exchangeable securities or rights to
purchase Common Stock or convertible or exchangeable securities. To the extent
the Notes become convertible into cash, assets, property or securities (other
than capital stock of the Company), no adjustment need be made thereafter as to
the cash, assets, property or such securities. Interest will not accrue on any
cash into which the Notes are convertible.


 


43

















 


(j) Whenever the
Conversion Rate is adjusted as herein provided, the Company shall promptly file
with the Trustee and any conversion agent other than the Trustee an Officers’
Certificate setting forth the Conversion Rate after such adjustment and setting
forth a brief statement of the facts requiring such adjustment. Unless and
until a Responsible Officer of the Trustee shall have received such Officers’
Certificate, the Trustee shall not be deemed to have knowledge of any
adjustment of the Conversion Rate and may assume that the last Conversion Rate
of which it has knowledge is still in effect. Promptly after delivery of such
certificate, the Company shall prepare a notice of such adjustment of the
Conversion Rate setting forth the adjusted Conversion Rate and the date on
which each adjustment becomes effective and shall mail such notice of such
adjustment of the Conversion Rate to the holder of each Note at his last address
appearing on the Note Register provided for in Section 2.05 of this
Indenture, within twenty (20) calendar days after execution thereof. Failure to
deliver such notice shall not affect the legality or validity of any such
adjustment.


 


(k) In any case in which
this Section 15.05 provides that an adjustment shall become effective
immediately after (1) a record date for an event, (2) the date fixed
for the determination of stockholders entitled to receive a dividend or
distribution pursuant to Section 15.05(a), (3) a date fixed for the
determination of stockholders entitled to receive rights or warrants pursuant
to Section 15.05(b), or (4) the Expiration Time for any tender or
exchange offer pursuant to Section 15.05(f), (each a “Determination Date”),
the Company may elect to defer until the occurrence of the applicable
Adjustment Event (as hereinafter defined) (x) issuing to the holder of any
Note converted after such Determination Date and before the occurrence of such
Adjustment Event, the additional shares of Common Stock or other securities
issuable upon such conversion by reason of the adjustment required by such
Adjustment Event over and above the Common Stock issuable upon such conversion
before giving effect to such adjustment and (y) paying to such holder any
amount in cash in lieu of any fraction pursuant to Section 15.03. For
purposes of this Section 15.05(k), the term “Adjustment Event” shall mean:


 


(i) in any case
referred to in clause (1) hereof, the occurrence of such event,


 


(ii) in any case referred
to in clause (2) hereof, the date any such dividend or distribution is
paid or made,


 


(iii) in any case
referred to in clause (3) hereof, the date of expiration of such rights or
warrants, and


 


(iv) in any case
referred to in clause (4) hereof, the date a sale or exchange of Common
Stock pursuant to such tender or exchange offer is consummated and becomes
irrevocable.


 


(l) For purposes of
this Section 15.05, the number of shares of Common Stock at any time
outstanding shall not include shares held in the treasury of the Company but
shall include shares issuable in respect of scrip certificates issued in lieu
of fractions of shares of Common Stock. The Company will not pay any dividend
or make any distribution on shares of Common Stock held in the treasury of the
Company.


 


(m) No adjustment to
the Conversion Rate shall be made pursuant to this Section 15.05 if the
holders of the Notes may participate in the transaction that would otherwise
give rise to adjustment pursuant to this Section 15.05.


 


Section 15.06. Effect
of Reclassification, Consolidation, Merger or Sale. If any of the following
events occur, namely (i) any reclassification or change of the outstanding
shares of Common Stock (other than a subdivision or combination to which Section 15.05(c) applies),
(ii) any consolidation, merger, binding share exchange or combination of
the Company with another Person as a result of which holders of Common Stock
shall be entitled to receive capital stock, other securities or other property
or assets (including cash) with respect to or in exchange for such Common
Stock, or (iii) any sale or conveyance of all or substantially all of the
properties and assets of the Company to any other Person as a result of which
holders of Common Stock shall be entitled to receive capital stock, other
securities or other property or assets (including cash) with respect to or in
exchange for such Common Stock, then the Company or the successor or purchasing
Person, as the case may be, shall execute with the Trustee a supplemental indenture
(which shall comply with the Trust Indenture Act as in force at the date of
execution of such supplemental indenture) providing that each Note shall be
convertible into the kind and amount of shares of capital stock, other
securities or other property or assets (including cash) receivable upon such
reclassification, change, consolidation, merger, binding share exchange,
combination, sale or conveyance by a holder of a number of shares of Common
Stock issuable upon conversion of such Notes (assuming, for such purposes, a
sufficient number of authorized shares of Common Stock are available to convert
all such Notes) immediately prior to such reclassification, change,
consolidation, merger, binding share exchange, combination, sale or conveyance
assuming such holder of Common Stock did not exercise his rights of election,
if any, as to the kind or amount of capital stock, other securities or other
property or assets (including cash) receivable upon such reclassification,
change, consolidation, merger, binding share exchange, combination, sale or
conveyance (provided that, if the kind or amount of capital stock, other
securities or other property or assets (including cash) receivable upon such
reclassification, change, consolidation, merger, binding share exchange,
combination, sale or conveyance is not the same for each share of Common Stock
in respect of which such rights of election shall not have been exercised (“non-electing
share”), then for the purposes of this Section 15.06 the kind and amount
of stock, other securities or other property or assets (including cash)
receivable upon such reclassification, change, consolidation, merger,
combination, sale or conveyance for each non-electing share shall be deemed to
be the kind and amount so receivable per share by a plurality of the
non-electing shares). Such supplemental indenture shall provide for adjustments
which shall be as nearly equivalent as may be practicable to the adjustments
provided for in this Article 15.


 


The Company shall cause
notice of the execution of such supplemental indenture to be mailed to each
holder of Notes, at its address appearing on the Note Register provided for in Section 2.05
of this Indenture, within twenty (20) calendar days after execution thereof.
Failure to deliver such notice shall not affect the legality or validity of
such supplemental indenture.


 


44

















 


The above provisions of this
Section shall similarly apply to successive reclassifications, changes,
consolidations, mergers, combinations, sales and conveyances.


 


If this Section 15.06
applies to any event or occurrence, Section 15.05 shall not apply.


 


Section 15.07 . Taxes
on Shares Issued. The issue of stock certificates on conversions of Notes shall
be made without charge to the converting Noteholder for any documentary, stamp
or similar issue or transfer tax in respect of the issue thereof. The Company
shall not, however, be required to pay any such tax which may be payable in
respect of any transfer involved in the issue and delivery of stock in any name
other than that of the holder of any Note converted, and the Company shall not
be required to issue or deliver any such stock certificate unless and until the
Person or Persons requesting the issue thereof shall have paid to the Company
the amount of such tax or shall have established to the satisfaction of the
Company that such tax has been paid.


 


Section 15.08 .
Reservation of Shares, Shares to be Fully Paid; Compliance with Governmental
Requirements; Listing of Common Stock. The Company shall provide, free from
preemptive rights, out of its authorized but unissued shares or shares held in
treasury, sufficient shares of Common Stock to provide for the conversion of
the Notes from time to time as such Notes are presented for conversion.


 


Before taking any action
which would cause an adjustment increasing the Conversion Rate to an amount
that would cause the Conversion Price to be reduced below the then par value,
if any, of the shares of Common Stock issuable upon conversion of the Notes,
the Company will take all corporate action which may, in the opinion of its
counsel, be necessary in order that the Company may validly and legally issue
shares of such Common Stock at such adjusted Conversion Rate.


 


The Company covenants that
all shares of Common Stock which may be issued upon conversion of Notes will
upon issue be fully paid and non-assessable by the Company and free from all
taxes, liens and charges with respect to the issue thereof.


 


The Company covenants that,
if any shares of Common Stock to be provided for the purpose of conversion of
Notes hereunder require registration with or approval of any governmental
authority under any federal or state law before such shares may be validly
issued upon conversion, the Company will in good faith and as expeditiously as
possible, to the extent then permitted by the rules and interpretations of
the Commission (or any successor thereto), endeavor to secure such registration
or approval, as the case may be.


 


The Company further covenants
that, if at any time the Common Stock shall be listed on The New York Stock
Exchange or any other national securities exchange or automated quotation
system, the Company will, if permitted by the rules of such exchange or
automated quotation system, list and keep listed, so long as the Common Stock
shall be so listed on such exchange or automated quotation system, all Common
Stock issuable upon conversion of the Note; provided that if the rules of
such exchange or automated quotation system permit the Company to defer the
listing of such Common Stock until the first conversion of the Notes into
Common Stock in accordance with the provisions of this Indenture, the Company
covenants to list such Common Stock issuable upon conversion of the Notes in accordance
with the requirements of such exchange or automated quotation system at such
time.


 


Section 15.09.
Responsibility of Trustee. The Trustee and any other conversion agent shall not
at any time be under any duty or responsibility to any holder of Notes to
determine the Conversion Rate or whether any facts exist which may require any
adjustment of the Conversion Rate, or with respect to the nature or extent or
calculation of any such adjustment when made, or with respect to the method
employed, or herein or in any supplemental indenture provided to be employed,
in making the same. The Trustee and any other conversion agent shall not be
accountable with respect to the validity or value (or the kind or amount) of
any shares of Common Stock, or of any capital stock, other securities or other
assets or property, which may at any time be issued or delivered upon the
conversion of any Note; and the Trustee and any other conversion agent make no
representations with respect thereto. Neither the Trustee nor any conversion
agent shall be responsible for any failure of the Company to issue, transfer or
deliver any shares of Common Stock or stock certificates or other securities or
property or cash upon the surrender of any Note for the purpose of conversion
or to comply with any of the duties, responsibilities or covenants of the
Company contained in this Article 15. Without limiting the generality of
the foregoing, neither the Trustee nor any conversion agent shall be under any
responsibility to determine the correctness of any provisions contained in any
supplemental indenture entered into pursuant to Section 15.06 relating
either to the kind or amount of shares of capital stock or other securities or
other assets or property (including cash) receivable by Noteholders upon the
conversion of their Notes after any event referred to in such Section 15.06
or to any adjustment to be made with respect thereto, but, subject to the
provisions of Section 9.01, may accept as conclusive evidence of the
correctness of any such provisions, and shall be protected in relying upon, the
Officers’ Certificate (which the Company shall be obligated to file with the
Trustee prior to the execution of any such supplemental indenture) with respect
thereto.


 


Section 15.10. Notice
to Holders Prior to Certain Actions. In case:


 


(a) the Company shall
declare a dividend (or any other distribution) on its Common Stock that would
require an adjustment in the Conversion Rate pursuant to Section 15.05; or


 


(b) the Company shall
authorize the granting to the holders of all or substantially all of its Common
Stock of rights or warrants to subscribe for or purchase any share of any class
or any other rights or warrants; or


 


45

















 


(c) of any
reclassification or reorganization of the Common Stock of the Company (other
than a subdivision or combination of its outstanding Common Stock, or a change
in par value, or from par value to no par value, or from no par value to par
value), or of any consolidation or merger to which the Company is a party and
for which approval of any stockholders of the Company is required, or of the
sale or transfer of all or substantially all of the assets of the Company; or


 


(d) of the voluntary or
involuntary dissolution, liquidation or winding up of the Company;


 


the Company shall cause to
be filed with the Trustee and to be mailed to each holder of Notes at his
address appearing on the Note Register provided for in Section 2.05 of
this Indenture, as promptly as possible but in any event at least ten calendar
days prior to the applicable date hereinafter specified, a notice stating (x) the
date on which a record is to be taken for the purpose of such dividend,
distribution or rights or warrants, or, if a record is not to be taken, the
date as of which the holders of Common Stock of record to be entitled to such
dividend, distribution or rights are to be determined, or (y) the date on
which such reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding up is expected to become effective or
occur, and the date as of which it is expected that holders of Common Stock of
record shall be entitled to exchange their Common Stock for securities or other
property deliverable upon such reclassification, consolidation, merger, sale,
transfer, dissolution, liquidation or winding up. Failure to give such notice,
or any defect therein, shall not affect the legality or validity of such
dividend, distribution, reclassification, consolidation, merger, sale,
transfer, dissolution, liquidation or winding up.


 


Section 15.11.
Stockholder Rights Plans. If the rights provided for in the Company’s
stockholder rights agreement dated June 24, 2002 or in any future rights
plan adopted by the Company have separated from the shares of Common Stock in
accordance with the provisions of the applicable stockholder rights agreement
so that the holders of the Notes would not be entitled to receive any rights in
respect of Common Stock issuable upon conversion of the Notes, the Conversion
Rate will be adjusted as provided in Section 15.05(d).


 


Section 15.12. Option
to Satisfy Conversion Obligation with Cash, Common Stock or Combination
Thereof.


 


(a) Except to the
extent that the Company has irrevocably elected to make a cash payment of
principal upon conversion pursuant to Section 15.12(b), in lieu of
delivery of shares of Common Stock in satisfaction of the Company’s obligation
upon conversion of the Notes, the Company may elect to deliver cash or a
combination of cash and shares of Common Stock. The Company shall notify the
holder or holders, as the case may be, through the Trustee of the method the
Company chooses to satisfy its obligation upon conversion (the “Conversion
Obligation”), (i) in the Company’s notice of redemption, if the Company
has called the Notes for redemption, (ii) twenty-six Trading Days
immediately preceding the Maturity Date in respect of Notes to be converted
during the period beginning twenty-five Trading Days immediately preceding the
Maturity Date and ending one Trading Day immediately preceding the Maturity
Date, and (iii) no later than two Trading Days immediately following the
Conversion Date in all other cases (such period, the “Settlement Notice Period”).
If the Company elects to satisfy any portion of its Conversion Obligation in
cash, the Company shall specify in such notice the amount to be satisfied in
cash as a percentage of the Conversion Obligation or a fixed dollar amount. The
Company shall treat all holders converting on the same Trading Day in the same
manner. The Company shall not have any obligation to satisfy Conversion
Obligations arising on different Trading Days in the same manner.


 


If the Company elects to
satisfy any portion of the Conversion Obligation in cash (other than cash in
lieu of fractional shares), a holder may retract its Conversion Notice at any
time during the two Trading-Day period beginning on the Trading Day after the
last Trading Day of the Settlement Notice Period (the “Conversion Retraction
Period”); provided, that no such retraction can be made (and a Conversion
Notice shall be irrevocable) (x) if the holder delivers the Conversion
Notice in connection with a redemption pursuant to

Section 15.01(a)(iii); (y) if the holder delivers the Conversion
Notice during the period beginning twenty-five Trading Days immediately
preceding the Maturity Date and ending one Trading Day immediately preceding
the Maturity Date; or (z) if the Company has irrevocably elected pursuant
to Section 15.12(b) to make a cash payment of principal upon
conversion before such holder delivers its Conversion Notice. No retraction can
be made and a Conversion Notice shall be irrevocable if the Company does not
elect to deliver cash in lieu of shares of Common Stock.


 


With respect to each holder
that exercises its conversion right in accordance with this Indenture, if such
holder’s Conversion Notice has not been retracted, assuming all of the other
requirements have been satisfied by such holder, then settlement (a) in
Common Stock only shall occur as soon as practicable after the Company notifies
the holder or holders that settlement shall be in Common Stock only, and (b) in
cash or in a combination of cash and Common Stock shall occur on the second
Trading Day following the final Trading Day of the Cash Settlement Averaging
Period.


 


Settlement amounts will be
computed as follows:


 


(i) if the Company
elects to satisfy the entire Conversion Obligation in Common Stock, the Company
will deliver to such holder a number of shares of Common Stock equal to (1) the
aggregate principal amount of the Notes to be converted divided by 1,000,
multiplied by (2) the Conversion Rate in effect on the Conversion Date
(plus cash in lieu of fractional shares calculated as provided in Section 15.03);


 


(ii) if the Company
elects to satisfy the entire Conversion Obligation in cash, the Company will
deliver to such holder cash in an amount equal to the product of:


 


46

















 


(1) a number equal to (x) the
aggregate principal amount of the Notes to be converted divided by 1,000 and
multiplied by

(y) the Conversion Rate in effect on the Conversion Date, and


 


(2) the Applicable
Stock Price; and


 


(iii) if the Company
elects to satisfy the Conversion Obligation in a combination of cash (the “Cash
Amount”) (excluding any cash paid for fractional shares) and Common Stock, the
Company will deliver to such holder:


 


(1) a Cash Amount equal
to (x) the fixed dollar amount per $1,000 principal amount of Notes
specified in the notice regarding the Company’s chosen method of settlement
multiplied by the quotient of the aggregate principal amount of Notes to be
converted divided by 1,000 or (y) the percentage of the Conversion
Obligation specified in the notice regarding the Company’s chosen method of
settlement, multiplied by the amount of cash that would be paid pursuant to the
clause (ii) above, as the case may be; and


 


(2) a number of shares
of Common Stock equal to (x) the aggregate principal amount of Notes to be
converted divided by 1,000 and multiplied by (y) (a) the Conversion
Rate in effect on the Conversion Date minus (b) the Cash Amount per $1,000
principal amount of Notes divided by the Applicable Stock Price (plus cash in
lieu of fractional shares calculated as provided in Section 15.03).


 


(b) Notwithstanding
anything to the contrary in this Indenture, at any time prior to the
twenty-sixth Trading Day preceding the Maturity Date, the Company may
irrevocably elect, in its sole discretion without the consent of the holders of
the Notes, by written notice to the Trustee and the holders of the Notes to
satisfy in cash the Conversion Obligation with respect to the principal amount
of Notes to be converted after the date of such election, with any remaining
amount of the Conversion Obligation to be satisfied in shares of Common Stock.
The settlement amount will be computed as follows: (i) a cash amount equal
to the aggregate principal amount of Notes to be converted and (ii) a
number of shares equal to (x) the aggregate principal amount of Notes to
be converted divided by 1,000 and multiplied by (y) (1) the
Conversion Rate minus (2) $1,000 divided by the Applicable Stock Price
(plus cash in lieu of fractional shares calculated as provided in Section 15.03).


 


ARTICLE 16

MAKE WHOLE PREMIUM


 


Section 16.01. Make
Whole Premium.


 


(a) On or prior to January 15,
2010, upon the occurrence of a Fundamental Change, the Company will pay, on the
Fundamental Change Repurchase Date, the Make Whole Premium, if any, to holders
of the Notes who surrender their Notes for repurchase in connection with such
Fundamental Change pursuant to Section 3.05 or convert their Notes
pursuant to Section 15.01(a)(vi).


 


(b) The “Make Whole
Premium” will be determined as follows:


 


(i) if the Effective
Date is after January 15, 2010, no Make Whole Premium shall be paid;


 


(ii) if the Stock Price
is less than $37.49 (subject to adjustment pursuant to Section 16.02) (the
“Stock Price Threshold”), no Make Whole Premium shall be paid;


 


(iii) if the Stock
Price is more than $100.00 per share (subject to adjustment pursuant to Section 16.02)
(the “Stock Price Cap”), no Make Whole Premium shall be paid; and


 


(iv) in all other
cases, the Make Whole Premium shall equal the applicable Make Whole Percentage
multiplied by $1,000.


 


(c) For purposes of
this Section 16.01(c), the following terms shall have the respective
meanings indicated:


 


(i) “Effective Date”
means the date that a Fundamental Change becomes effective.


 


(ii) “Stock Price”
means the price paid per share of Common Stock in the transaction constituting
the Fundamental Change, determined as follows:


 


(A) if holders of
Common Stock receive only cash in the transaction constituting the Fundamental
Change, the Stock Price shall equal the cash amount paid per share of Common
Stock;


 


(B) in all other cases,
the Stock Price shall equal the average Closing Sale Price of a share of Common
Stock over the ten Trading-Day period ending on the Trading Day immediately
preceding the Effective Date; and


 


(iii) “Make Whole
Percentage” means the percentage set forth on the table below (the “Make Whole
Table”) for the Stock Price and the Effective Date:


 


47

















 


	
   

  	
   

  	
  Stock Price

  	
   

  
	
  Effective Date

  	
   

  	
  $37.49

  	
   

  	
  $40.99

  	
   

  	
  $44.49

  	
   

  	
  $47.99

  	
   

  	
  $50.24

  	
   

  	
  $55.00

  	
   

  	
  $60.00

  	
   

  	
  $70.00

  	
   

  	
  $80.00

  	
   

  	
  $90.00

  	
   

  	
  $100.00

  	
   

  
	
  6/22/2004

  	
   

  	
  0.00

  	
   

  	
  4.54

  	
   

  	
  9.60

  	
   

  	
  14.97

  	
   

  	
  18.41

  	
   

  	
  16.73

  	
   

  	
  15.08

  	
   

  	
  12.62

  	
   

  	
  10.78

  	
   

  	
  9.28

  	
   

  	
  8.07

  	
   

  
	
  1/15/2005

  	
   

  	
  0.00

  	
   

  	
  3.70

  	
   

  	
  8.69

  	
   

  	
  14.01

  	
   

  	
  17.42

  	
   

  	
  15.71

  	
   

  	
  14.05

  	
   

  	
  11.55

  	
   

  	
  9.80

  	
   

  	
  8.37

  	
   

  	
  7.23

  	
   

  
	
  7/15/2005

  	
   

  	
  0.00

  	
   

  	
  3.08

  	
   

  	
  7.99

  	
   

  	
  13.26

  	
   

  	
  16.68

  	
   

  	
  14.87

  	
   

  	
  13.17

  	
   

  	
  10.67

  	
   

  	
  8.96

  	
   

  	
  7.59

  	
   

  	
  6.51

  	
   

  
	
  7/15/2006

  	
   

  	
  0.00

  	
   

  	
  2.20

  	
   

  	
  6.81

  	
   

  	
  11.91

  	
   

  	
  15.30

  	
   

  	
  13.24

  	
   

  	
  11.51

  	
   

  	
  8.97

  	
   

  	
  7.30

  	
   

  	
  6.03

  	
   

  	
  5.09

  	
   

  
	
  7/15/2007

  	
   

  	
  0.00

  	
   

  	
  1.36

  	
   

  	
  5.63

  	
   

  	
  10.36

  	
   

  	
  13.67

  	
   

  	
  11.33

  	
   

  	
  9.57

  	
   

  	
  6.99

  	
   

  	
  5.38

  	
   

  	
  4.30

  	
   

  	
  3.57

  	
   

  
	
  7/15/2008

  	
   

  	
  0.00

  	
   

  	
  0.56

  	
   

  	
  4.28

  	
   

  	
  8.31

  	
   

  	
  11.43

  	
   

  	
  8.73

  	
   

  	
  6.96

  	
   

  	
  4.47

  	
   

  	
  3.13

  	
   

  	
  2.39

  	
   

  	
  1.97

  	
   

  
	
  7/15/2009

  	
   

  	
  0.00

  	
   

  	
  0.13

  	
   

  	
  1.57

  	
   

  	
  4.71

  	
   

  	
  7.24

  	
   

  	
  4.58

  	
   

  	
  2.55

  	
   

  	
  0.99

  	
   

  	
  0.61

  	
   

  	
  0.53

  	
   

  	
  0.48

  	
   

  
	
  1/15/2010

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  



 


If the Stock Price is
between two “Stock Price” amounts on the Make Whole Table or the Effective Date
is between two Effective Dates on the Make Whole Table, the Make Whole
Percentage will be determined by straight-line interpolation between Make Whole
Percentage amounts set forth for the higher and lower Stock Price amounts and
the two Effective Dates, as applicable, based on a 365 day year.


 


(d) The Company will
pay the Make Whole Premium in the same form of consideration into which all or
substantially all of the Common Stock has been converted or exchanged in
connection with the transaction constituting the Fundamental Change. If holders
of the Common Stock have the right to elect the form of consideration received
in the transaction constituting a Fundamental Change, then for purposes of determining
the form of consideration to be delivered in respect of the Make Whole Premium,
the consideration into which a share of Common Stock has been converted or
exchanged shall be deemed to equal (x) the aggregate consideration
distributed in respect of all shares of Common Stock divided by (y) the
total number of shares of Common Stock participating in the distribution.


 


(e) For purposes of
determining the value of the consideration to be delivered in respect of the
Make Whole Premium, the value will be calculated as follows:


 


(i) securities that are
traded on a United States national securities exchange or approved for
quotation on the Nasdaq National Market or any similar system of automated
dissemination of quotations of securities prices will be valued based on the
average Closing Sale Price or last sale price, as applicable, over the ten
Trading- Day period ending on the Trading Day immediately preceding the
Fundamental Change Repurchase Date,


 


(ii) other securities,
assets or property (other than cash) will be valued based on 98% of the average
of the fair market value of such securities, assets or property (other than
cash) as determined by two independent nationally recognized investment banks
selected by the Trustee, and


 


(iii) 100% of any cash.


 


A calculation agent (the “Calculation
Agent”) appointed from time to time by the Company shall, on behalf of and on
request by the Company or the Trustee, calculate (A) the Stock Price and (B) the
Make Whole Premium with respect to such Stock Price, based on the Effective
Date specified by the Company or the Trustee, and shall deliver its calculation
of the Stock Price and Make Whole Premium to the Company and the Trustee within
three Business Days of the request by the Company or the Trustee. In addition, the
Calculation Agent shall, on behalf of and upon request by the Company or the
Trustee made no less than three Business Days prior to a Fundamental Change
Repurchase Date, make the determinations described in Section 16.01(e)(i) above
and deliver its calculations to the Company or the Trustee by 9:00 p.m.,
New York City time, on the Trading Day preceding the Fundamental Change
Repurchase Date. The Company, or at the Company’s request, the Trustee in the
name and at the expense of the Company, (X) shall notify the holders of
the Stock Price and Make Whole Premium per $1,000 principal amount of Notes
with respect to a Fundamental Change as part of the Company Repurchase Notice
in connection with the Fundamental Change and (Y) shall notify the holders
prior to 9:00 a.m., New York City time, on the Fundamental Change
Repurchase Date of the number or amount of such securities, assets or property
to be paid in respect of the Make Whole Premium in connection with such
Fundamental Change, in the manner provided in Section 17.03, and the
Company shall also publicly announce such information and publish it on the
Company’s web site. Any notice so given shall be conclusively presumed to have
been duly given, whether or not the holder receives such notice.


 


(f) On or prior to the
Fundamental Change Repurchase Date, the Company shall deposit with the Paying
Agent a number or an amount of securities, assets or property sufficient to pay
the Make Whole Premium with respect to all the Notes to be repurchased on such
date and all the Notes converted in connection with such Fundamental Change;
provided that if such payment is made on the Fundamental Change Repurchase
Date, it must be received by the Paying Agent by 11:00 a.m., New York City
time, on such date.


 


Section 16.02. Adjustments
Relating To Make Whole Premium. Whenever the Conversion Rate shall be adjusted
from time to time by the Company pursuant to Section 15.05, the Stock
Price Threshold and the Stock Price Cap shall be adjusted and each of the Stock
Prices set forth in the Make Whole Table will be adjusted by multiplying each
such amount by a fraction, the numerator of which is the Conversion Rate
immediately prior to such adjustment and the denominator of which is the
Conversation Rate as so adjusted.


 


ARTICLE 17

MISCELLANEOUS PROVISIONS


 


Section 17.01.
Provisions Binding on Company’s Successors. All the covenants, stipulations,
promises and agreements by the Company contained in this Indenture shall bind
their respective successors and assigns whether so expressed or not.


 


48

















 


Section 17.02. Official
Acts by Successor Corporation. Any act or proceeding by any provision of this
Indenture authorized or required to be done or performed by any board,
committee or officer of the Company shall and may be done and performed with
like force and effect by the like board, committee or officer of any Person
that shall at the time be the lawful sole successor of the Company.


 


Section 17.03.
Addresses for Notices, etc. Any notice or demand which by any provision of this
Indenture is required or permitted to be given or served by the Trustee or by
the holders of Notes on the Company shall be in writing and shall be deemed to
have been sufficiently given or made, for all purposes, if given or served by
being deposited postage prepaid by registered or certified mail in a post
office letter box, or sent by overnight courier, or sent by telecopier
transmission addressed as follows: to Advanced Medical Optics, Inc., 1700
E. St. Andrew Place, Santa Ana, CA 92705, Telecopier No.: (714) 247-8679,
Attention: Aimee S. Weiner, Esq. Any notice, direction, request or demand
hereunder to or upon the Trustee shall be deemed to have been sufficiently
given or made, for all purposes, if given or served by being deposited, postage
prepaid, by registered or certified mail in a post office letter box, or sent
by overnight courier, or sent by telecopier transmission addressed as follows:
U.S. Bank National Association, 60 Livingston Avenue, St. Paul, Minnesota 55107-2292,
Telecopier No.: (651) 495-8097, Attention: Corporate Trust Department.


 


The Trustee, by notice to
the Company, may designate additional or different addresses for subsequent
notices or communications.


 


Any notice or communication
mailed to a Noteholder shall be mailed by first class mail, postage prepaid, at
such Noteholder’s address as it appears on the Note Register and shall be
sufficiently given to such Noteholder if so mailed within the time prescribed.


 


Failure to mail a notice or
communication to a Noteholder or any defect in it shall not affect its
sufficiency with respect to other Noteholders. If a notice or communication is
mailed in the manner provided above, it is duly given, whether or not the
addressee receives it.


 


Section 17.04. Governing
Law. This Indenture shall be governed by, and construed in accordance with, the
laws of the State of New York.


 


Section 17.05 .
Evidence of Compliance with Conditions Precedent, Certificates to Trustee. Upon
any application or demand by the Company to the Trustee to take any action
under any of the provisions of this Indenture, the Company shall furnish to the
Trustee an Officers’ Certificate stating that all conditions precedent, if any,
provided for in this Indenture relating to the proposed action have been
complied with, and an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.


 


Each certificate or opinion
provided for in this Indenture and delivered to the Trustee with respect to
compliance with a condition or covenant provided for in this Indenture shall
include: (1) a statement that the person making such certificate or
opinion has read such covenant or condition; (2) a brief statement as to
the nature and scope of the examination or investigation upon which the
statement or opinion contained in such certificate or opinion is based; (3) a
statement that, in the opinion of such person, such person has made such
examination or investigation as is necessary to enable such person to express
an informed opinion as to whether or not such covenant or condition has been
complied with; and (4) a statement as to whether or not, in the opinion of
such person, such condition or covenant has been complied with; provided,
however, that with respect to matters of fact an Opinion of Counsel may rely on
an Officers’ Certificate or certificates of public officials.


 


Section 17.06. Legal
Holidays. In any case in which the date of maturity of interest on or principal
or premium, if any, of the Notes or the redemption date or repurchase date of
any Note will not be a Business Day, then payment of such interest on or
principal or premium, if any, of the Notes need not be made on such date, but
may be made on the next succeeding Business Day with the same force and effect
as if made on the date of maturity or the redemption or repurchase date, and no
interest shall accrue for the period from and after such date.


 


Section 17.07. Trust
Indenture Act. This Indenture is hereby made subject to, and shall be governed
by, the provisions of the Trust Indenture Act required to be part of and to
govern indentures qualified under the Trust Indenture Act; provided that unless
otherwise required by law, notwithstanding the foregoing, this Indenture and
the Notes issued hereunder shall not be subject to the provisions of
subsections (a)(1), (a)(2), and (a)(3) of Section 314 of the Trust
Indenture Act as now in effect or as hereafter amended or modified; provided
further that this Section 17.07 shall not require this Indenture or the
Trustee to be qualified under the Trust Indenture Act prior to the time such
qualification is in fact required under the terms of the Trust Indenture Act,
nor shall it constitute any admission or acknowledgment by any party to the
Indenture that any such qualification is required prior to the time such
qualification is in fact required under the terms of the Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with another provision
hereof which is required to be included in an indenture qualified under the
Trust Indenture Act, such required provision shall control.


 


Section 17.08. No
Security Interest Created. Nothing in this Indenture or in the Notes, expressed
or implied, shall be construed to constitute a security interest under the
Uniform Commercial Code or similar legislation, as now or hereafter enacted and
in effect, in any jurisdiction in which property of the Company or its
subsidiaries is located.


 


Section 17.09. Benefits
of Indenture. Nothing in this Indenture or in the Notes, express or implied,
shall give to any Person, other than the parties hereto, any Paying Agent, any
authenticating agent, any Note Registrar and their successors hereunder and the
holders of Notes any benefit or any legal or equitable right, remedy or claim
under this Indenture.


 


Section 17.10. Table of
Contents, Headings, etc. The table of contents and the titles and headings of
the Articles and Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.


 


49

















 


Section 17.11.
Authenticating Agent. The Trustee may appoint an authenticating agent that
shall be authorized to act on its behalf, and subject to its direction, in the
authentication and delivery of Notes in connection with the original issuance
thereof and transfers and exchanges of Notes hereunder, including under
Sections 2.04, 2.05, 2.06, 2.07, 3.03, 3.05 and 3.06, as fully to all intents
and purposes as though the authenticating agent had been expressly authorized
by this Indenture and those Sections to authenticate and deliver Notes. For all
purposes of this Indenture, the authentication and delivery of Notes by the
authenticating agent shall be deemed to be authentication and delivery of such
Notes “by the Trustee” and a certificate of authentication executed on behalf
of the Trustee by an authenticating agent shall be deemed to satisfy any requirement
hereunder or in the Notes for the Trustee’s certificate of authentication. Such
authenticating agent shall at all times be a Person eligible to serve as
trustee hereunder pursuant to Section 9.09.


 


Any corporation into which
any authenticating agent may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, consolidation or
conversion to which any authenticating agent shall be a party, or any
corporation succeeding to the corporate trust business of any authenticating
agent, shall be the successor of the authenticating agent hereunder, if such
successor corporation is otherwise eligible under this Section 17.11,
without the execution or filing of any paper or any further act on the part of
the parties hereto or the authenticating agent or such successor corporation.


 


Any authenticating agent may
at any time resign by giving written notice of resignation to the Trustee and
to the Company. The Trustee may at any time terminate the agency of any
authenticating agent by giving written notice of termination to such
authenticating agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time any
authenticating agent shall cease to be eligible under this Section, the Trustee
shall either promptly appoint a successor authenticating agent or itself assume
the duties and obligations of the former authenticating agent under this
Indenture and, upon such appointment of a successor authenticating agent, if made,
shall give written notice of such appointment of a successor authenticating
agent to the Company and shall mail notice of such appointment of a successor
authenticating agent to all holders of Notes as the names and addresses of such
holders appear on the Note Register.


 


The Company agrees to pay to
the authenticating agent from time to time such reasonable compensation for its
services as shall be agreed upon in writing between the Company and the
authenticating agent.


 


The provisions of Sections
9.02, 9.03, 9.04 and 10.03 and this Section 17.11 shall be applicable to
any authenticating agent.


 


Section 17.12.
Execution in Counterparts. This Indenture may be executed in any number of
counterparts, each of which shall be an original, but such counterparts shall
together constitute but one and the same instrument.


 


Section 17.13.
Severability. In case any provision in this Indenture or in the Notes shall be
invalid, illegal or unenforceable, then (to the extent permitted by law) the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.


 


U.S. Bank National
Association hereby accepts the trusts in this Indenture declared and provided,
upon the terms and conditions herein above set forth.


 


50

















 


IN WITNESS WHEREOF, the
parties hereto have caused this Indenture to be duly executed.


 


	
   

  	
     ADVANCED
  MEDICAL OPTICS, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
            /s/
  Aimee S. Weisner

  
	
   

  	
   

  	
  Name:

  	
  Aimee S. Weisner

  
	
   

  	
   

  	
  Title:

  	
  Corporate Vice President,

  
	
   

  	
   

  	
   

  	
  General Counsel, Secretary

  
	
   

  	
   

  	
   

  	
  and Chief Ethics Officer

  



 


 


	
   

  	
  U.S. BANK NATIONAL
        ASSOCIATION, as Trustee By:

  
	
   

  	
   

  
	
   

  	
  By:

  	
            /s/
  Frank Leslie

  
	
   

  	
   

  	
  Name:

  	
  Frank Leslie III

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  



 


51
















 


EXHIBIT A


 


THIS NOTE HAS BEEN ISSUED
WITH ORIGINAL ISSUE DISCOUNT, FOR PURPOSES OF SECTIONS 1272, 1273, AND 1275 OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. UPON THE REQUEST OF THE HOLDER
OF THIS NOTE, THE COMPANY WILL PROMPTLY MAKE AVAILABLE TO THE HOLDER OF THIS
NOTE, (1) THE ISSUE PRICE OF THE NOTE, (II) THE AMOUNT OF ORIGINAL
ISSUE DISCOUNT IN RESPECT THEREOF, (III) THE ISSUE DATE OF THE NOTE, (IV) THE
COMPARABLE YIELD OF THE NOTE, AND (V) THE PROJECTED PAYMENT SCHEDULE OF
THE NOTE, IN EACH CASE AS DETERMINED UNDER THE ORIGINAL ISSUE DISCOUNT RULES OF
THE U.S. INTERNAL REVENUE CODE. PLEASE CONTACT: ADVANCED MEDICAL OPTICS, INC.,
ATTN: INVESTOR RELATIONS DEPARTMENT, 1700 E. ST. ANDREW PLACE, SANTA ANA, CA
92705.


 


[Include only for Global
Notes]


 


[UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) (THE “DEPOSITARY”, WHICH TERM INCLUDES ANY
SUCCESSOR DEPOSITARY FOR THE CERTIFICATES) TO THE COMPANY OR ITS AGENT FOR REGISTRATION
OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN
THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT HEREIN IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]


 


[Include only for Notes that
are Restricted Securities]


 


THE SECURITY EVIDENCED BY
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS, AND MAY NOT
BE OFFERED OR SOLD EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS
ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER: (1) REPRESENTS
THAT IT IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT AND IS PURCHASING IN COMPLIANCE WITH RULE 144A UNDER THE
SECURITIES ACT; (2) AGREES THAT IT WILL NOT WITHIN TWO YEARS AFTER THE
ORIGINAL ISSUANCE OF THIS SECURITY RESELL OR OTHERWISE TRANSFER THE SECURITY
EVIDENCED HEREBY OR THE COMMON STOCK ISSUABLE UPON CONVERSION OF SUCH SECURITY
EXCEPT (A) TO ADVANCED MEDICAL OPTICS, INC. (“THE COMPANY”) OR ANY
SUBSIDIARY THEREOF, (B) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE
WITH RULE 144A UNDER THE SECURITIES ACT, (C) PURSUANT TO THE EXEMPTION
FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE),
OR (D) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT AND WHICH CONTINUES TO BE EFFECTIVE AT THE
TIME OF SUCH TRANSFER; AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO
WHOM THE SECURITY EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN A TRANSFER
PURSUANT TO CLAUSE 2(C) OR 2(D) ABOVE) A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND.


 


IN CONNECTION WITH ANY
TRANSFER OF THE SECURITY EVIDENCED HEREBY WITHIN TWO YEARS AFTER THE ORIGINAL
ISSUANCE OF SUCH SECURITY (OTHER THAN A TRANSFER PURSUANT TO CLAUSE 2(D) ABOVE),
THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF
RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE
TRUSTEE (OR ANY SUCCESSOR TRUSTEE, AS APPLICABLE). IF THE PROPOSED TRANSFER IS
PURSUANT TO CLAUSE 2(C) ABOVE, THE HOLDER MUST, PRIOR TO SUCH TRANSFER,
FURNISH TO THE TRUSTEE (OR ANY SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH
CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS THE COMPANY OR THE
TRUSTEE MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE
PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED
UPON THE EARLIER OF THE TRANSFER OF THE SECURITY EVIDENCED HEREBY PURSUANT TO
CLAUSE 2(C) OR 2(D) ABOVE OR THE EXPIRATION OF TWO YEARS FROM THE
ORIGINAL ISSUANCE OF THE SECURITY EVIDENCED HEREBY.


 


THE HOLDER OF THIS SECURITY
IS ENTITLED TO THE BENEFITS OF A REGISTRATION RIGHTS AGREEMENT (AS SUCH TERM IS
DEFINED IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF) AND, BY ITS
ACCEPTANCE HEREOF, AGREES TO BE BOUND BY AND TO COMPLY WITH THE PROVISIONS OF
SUCH REGISTRATION RIGHTS AGREEMENT.


 

















 


ADVANCED MEDICAL OPTICS, INC.


 


2.50% CONVERTIBLE SENIOR SUBORDINATED NOTES DUE 2024


 


CUSIP:


 


No. $


 


Advanced Medical Optics, Inc.,
a Delaware corporation (herein called the “Company”, which term includes any
successor corporation under the Indenture referred to on the reverse hereof),
for value received hereby promises to pay to                  
or its registered assigns, [the principal sum of                    
DOLLARS] [or, such amount as is indicated in the records of the Trustee and the
Depositary](1) on July 15, 2024 at the office or agency of the
Company maintained for that purpose in accordance with the terms of the
Indenture, in such coin or currency of the United States of America as at the
time of payment shall be legal tender for the payment of public and private debts,
and to pay interest, semi-annually on January 15 and July 15 of each
year, commencing January 15, 2005, on said principal sum at said office or
agency, in like coin or currency, at the rate per annum of 2.50%, from the January 15
or July 15, as the case may be, next preceding the date of this Note to
which interest has been paid or duly provided for, unless the date hereof is a
date to which interest has been paid or duly provided for, in which case from
the date of this Note, or unless no interest has been paid or duly provided for
on the Notes, in which case from June 22, 2004 until payment of said
principal sum has been made or duly provided for. Notwithstanding the
foregoing, if the date hereof is after any January 1 or July 1, as
the case may be, and before the following January 15 or July 15, this
Note shall bear interest from such January 15 or July 15; provided
that if the Company shall default in the payment of interest due on such January 15
or July 15, then this Note shall bear interest from the next preceding January 15
or July 15 to which interest has been paid or duly provided for or, if no
interest has been paid or duly provided for on such Note, from June 22,
2004. Beginning with the six-month interest period commencing January 15,
2010, the Notes may accrue contingent interest. Contingent interest, if any,
for any six-month interest period will be payable on the applicable January 15
or July 15 interest payment date. Except as otherwise provided in the
Indenture, the interest payable on the Note pursuant to the Indenture on any January 15
or July 15 will be paid to the Person entitled thereto as it appears in
the Note Register at 5:00 p.m., New York City time, on the applicable
record date, which shall be the January 1 or July 1 (whether or not a
Business Day) next preceding such January 15 or July 15, as provided
in the Indenture; provided that any such interest not punctually paid or duly
provided for shall be payable as provided in the Indenture. The Company shall
pay interest on any Notes in certificated form by check mailed to the address
of the Person entitled thereto as it appears in the Note Register. Payments to
The Depository Trust Company will be made by wire transfer in immediately
available funds to the account of the DTC or its nominee.


 






(1) For
Global Notes only.


 


The Company promises to pay
interest on overdue principal, premium, if any, and (to the extent that payment
of such interest is enforceable under applicable law) interest at the rate of
1% per annum above the rate borne by the Notes.


 


Reference is made to the
further provisions of this Note set forth on the reverse hereof, including,
without limitation, provisions giving the holder of this Note the right to
convert this Note into Common Stock on the terms and subject to the limitations
referred to on the reverse hereof and as more fully specified in the Indenture.
Such further provisions shall for all purposes have the same effect as though
fully set forth at this place.


 


IN THE CASE OF ANY CONFLICT
BETWEEN THE PROVISIONS OF THIS NOTE AND THE INDENTURE, THE PROVISIONS OF THE
INDENTURE SHALL CONTROL. THE INDENTURE AND THIS NOTE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.


 


This Note shall not be valid
or become obligatory for any purpose until the certificate of authentication
hereon shall have been manually signed by the Trustee or a duly authorized
authenticating agent under the Indenture.


 


A-2

















 


IN WITNESS WHEREOF, the
Company has caused this Note to be duly executed.


 


	
   

  	
  ADVANCED
  MEDICAL OPTICS, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  



 


A-3

















 


TRUSTEE’S CERTIFICATE OF AUTHENTICATION


 


This is one of the Notes
described in the within-named Indenture.


 


U.S. BANK
NATIONAL ASSOCIATION, as Trustee


 


By:


 


Authorized Signatory


 


A-4

















 


FORM OF REVERSE OF NOTE


 


ADVANCED MEDICAL OPTICS, INC.


 


2.50% CONVERTIBLE SENIOR SUBORDINATED NOTE DUE 2024


 


This note is one of a duly
authorized issue of notes of the Company, designated as its 2.50% Convertible
Senior Subordinated Notes Due 2024 (herein called the “Notes”), limited in
aggregate principal amount to $350,000,000, issued and to be issued under and
pursuant to an Indenture dated as of June 22, 2004 (herein called the “Indenture”),
between the Company and U.S. Bank National Association, as trustee (herein
called the “Trustee”), to which Indenture and all indentures supplemental
thereto reference is hereby made for a description of the rights, limitations
of rights, obligations, duties and immunities thereunder of the Trustee, the
Company and the holders of the Notes. Defined terms used but not otherwise
defined in this Note shall have the respective meanings ascribed thereto in the
Indenture.


 


If an Event of Default
occurs and is continuing, the principal of, premium, if any, and accrued and
unpaid interest on all Notes may be declared to be due and payable by either
the Trustee or the holders of at least 25% in aggregate principal amount of the
Notes then outstanding, and, upon said declaration the same shall be due and
payable, (a) immediately if there shall no longer be a Senior Credit
Facility or (b) if the Senior Credit Facility is in effect, immediately
upon the earlier to occur of (i) the date indebtedness under the Senior
Credit Facility is declared accelerated and (ii) the fifth Business Day
after written notice of the declaration of such acceleration has been given to
the agents under the Senior Credit Facility, in the manner, with the effect and
subject to the conditions provided in the Indenture.


 


The Indenture contains
provisions permitting the Company and the Trustee, with the consent of the
holders of a majority in aggregate principal amount of the Notes at the time
outstanding, to execute supplemental indentures adding any provisions to or
changing in any manner or eliminating any of the provisions of the Indenture or
of any supplemental indenture or modifying in any manner the rights of the
holders of the Notes, subject to exceptions set forth in Section 11.02 of
the Indenture. Subject to the provisions of the Indenture, the holders of a
majority in aggregate principal amount of the Notes at the time outstanding
may, on behalf of the holders of all of the Notes, waive any past default or
Event of Default, subject to exceptions set forth in the Indenture. Upon any
such waiver, said default shall for all purposes of this Note and the Indenture
be deemed to have been cured and to be not continuing, but no such waiver shall
extend to any subsequent or other default or impair any right consequent
thereon.


 


The indebtedness evidenced
by the Notes is, to the extent and in the manner provided in the Indenture,
contractually subordinated in right of payment or satisfaction to the prior
payment or satisfaction in full in cash of all Senior Indebtedness of the
Company, whether outstanding at the date of the Indenture or thereafter
incurred, and this Note is issued subject to the provisions of the Indenture
with respect to such subordination. Each holder of this Note, by accepting the
same, agrees to and shall be bound by such provisions and authorizes the
Trustee on its behalf to take such action as may be necessary or appropriate to
effectuate the subordination so provided and appoints the Trustee his
attorney-in-fact for such purpose.


 


No reference herein to the
Indenture and no provision of this Note or of the Indenture shall impair, as
among the Company and the holder of the Notes, the obligation of the Company,
which is absolute and unconditional, to pay the principal of, premium, if any,
on and interest on this Note at the place, at the respective times, at the rate
and in the coin or currency herein and in the Indenture prescribed.


 


Interest on the Notes shall
be computed on the basis of a 360-day year of twelve 30-day months.


 


The Notes are issuable in
fully registered form, without coupons, in denominations of $1,000 principal
amount and any multiple of $1,000. At the office or agency of the Company
referred to on the face hereof, and in the manner and subject to the
limitations provided in the Indenture, without payment of any service charge
but with payment of a sum sufficient to cover any tax, assessment or other
governmental charge that may be imposed in connection with any registration or
exchange of Notes, Notes may be exchanged for a like aggregate principal amount
of Notes of any other authorized denominations.


 


At any time on or after January 20,
2010 and prior to maturity, the Notes may be redeemed at the option of the Company,
in whole or in part, upon mailing a notice of such redemption not less than 30
calendar days but not more than 60 calendar days before the redemption date to
each holder of Notes, all as provided in the Indenture, in cash at a redemption
price equal to 100% of the principal amount of Notes being redeemed and accrued
and unpaid interest to, but excluding, the redemption date; provided that if
the redemption date is after a record date and on or prior to the corresponding
interest payment date, the accrued and unpaid interest shall be payable to the
holder of record of this Note on the preceding January 1 or July 1,
as the case may be. The Company may not redeem any Notes if a default in the
payment of interest on the Notes has occurred and is continuing.


 


The Notes are not subject to
redemption through the operation of any sinking fund.


 


If a Fundamental Change
occurs at any time prior to maturity of the Notes, this Note will be subject to
a repurchase, at the option of the holder, on a Fundamental Change Repurchase
Date, specified by the Company, that is not less than 20 Business Days nor more
than 35 Business Days after notice thereof, at a repurchase price equal to 100%
of the principal amount hereof, together with accrued and unpaid interest on this
Note to, but excluding, the Fundamental Change Repurchase Date, plus the
applicable Make Whole Premium, if any; provided that if such Fundamental Change
Repurchase Date falls after a record date and on or prior the corresponding
interest payment date, the accrued and unpaid interest shall be 


 


A-5

















 


payable to the holder of
record of this Note on the preceding January 1 or July 1, as the case
may be. The Notes submitted for repurchase must be $1,000 in principal amount
or whole multiples thereof. The Company shall mail to all holders of record of
the Notes (and to beneficial owners as required by applicable law) a notice of
the occurrence of a Fundamental Change and of the repurchase right arising as a
result thereof on or before the 10th Business Day after the occurrence of such
Fundamental Change. For a Note to be so redeemed at the option of the holder,
the holder must deliver to the Paying Agent in accordance with the terms of the
Indenture, the Repurchase Notice containing the information specified by the
Indenture, together with such Note, duly endorsed for transfer, or (if the
Notes are Global Notes) book-entry transfer of the Note, prior to 5:00 p.m.,
New York City time, on the Business Day immediately preceding the Fundamental
Change Repurchase Date. The repurchase price may be paid, at the option of the
Company, in cash or by the issuance and delivery of shares of Applicable Stock,
or in any combination thereof, subject to the terms and conditions of the
Indenture.


 


Subject to the terms and
conditions of the Indenture, each holder shall have the right, at such holder’s
option, to require the Company to repurchase all or any portion of the Notes
held by such holder, on January 15, 2010, July 15, 2014 and July 15,
2019 at a repurchase price equal to 100% of the principal amount of this Note,
together with any accrued and unpaid interest on this Note to, but excluding,
the Repurchase Date. The accrued and unpaid interest shall be payable to the
holder of record of this Note on the preceding January 1 or July 1,
as the case may be. To exercise such right, a holder shall deliver to the
Paying Agent the Repurchase Notice containing the information specified by the
Indenture, together with the Note, duly endorsed for transfer, or (if the Notes
are Global Notes) book-entry transfer of the Note, at any time from 9:00 a.m.,
New York City time, on the date that is 20 Business Days prior to the
applicable Repurchase Date to 5:00 p.m., New York City time, on the
Business Day immediately preceding the applicable Repurchase Date. Except if
the Company has irrevocably elected to make a cash payment of principal upon
conversion pursuant to Section 15.12(b) of the Indenture, the Company
may elect to pay the repurchase price in cash or by the issuance and delivery
of shares of Common Stock, or in any combination thereof, subject to the terms
and conditions of the Indenture. If the Company has irrevocably elected to make
a cash payment of principal upon conversion pursuant to Section 15.12(b) of
the Indenture, then the repurchase price must be paid in cash.


 


Holders have the right to
withdraw any Repurchase Notice by delivering to the Paying Agent a written
notice of withdrawal at any time prior to 5:00 p.m., New York City time, on the
Business Day immediately preceding the Fundamental Change Repurchase Date or
the Repurchase Date, as applicable, all as provided in the Indenture.


 


If cash, shares of
Applicable Stock or Common Stock, as the case may be, or any combination
thereof, as permitted under the Indenture, sufficient to pay the repurchase
price of and accrued and unpaid interest and in the case of a Fundamental
Change, the applicable Make Whole Premium, if any, on all Notes or portions
thereof to be repurchased as of the Fundamental Change Repurchase Date or
Repurchase Date, as the case may be, is deposited with the Paying Agent, on the
Fundamental Change Repurchase Date or on the Repurchase Date, as the case may
be, then such Notes will cease to be outstanding and interest will cease to
accrue on such Notes immediately thereafter, and the holder thereof shall have
no other rights as such other than the right to receive the repurchase price
upon surrender of such Note.


 


Subject to the occurrence of
certain events specified in the Indenture and in compliance with the provisions
of the Indenture, on or prior to the Trading Day immediately preceding the
Maturity Date of this Note, the holder hereof has the right, at its option, to
convert each $1,000 principal amount of this Note into 19.9045 shares of Common
Stock (a conversion price of approximately $50.24 per share), as such shares
shall be constituted at the date of conversion and subject to adjustment from
time to time as provided in the Indenture, upon surrender of this Note (if in
certificated form) with the form entitled “Conversion Notice” on the reverse
hereof duly completed and manually signed, to the Company at the office or
agency of the Company maintained for that purpose in the City of New York in
accordance with the terms of the Indenture, or at the option of such holder,
the Corporate Trust Office, together with any funds required pursuant to the
terms of the Indenture, and, unless the shares issuable on conversion are to be
issued in the same name as this Note, duly endorsed by, or accompanied by
instruments of transfer in form satisfactory to the Company duly executed by,
the holder or by such holder’s duly authorized attorney. The Company will
notify the holder thereof of any event triggering the right to convert the
Notes as specified above in accordance with the Indenture. In order to exercise
the conversion right with respect to any interest in a Global Note, the holder
must complete the appropriate instruction form pursuant to the Depositary’s
book-entry conversion program, deliver by book-entry delivery an interest in
such Global Note, furnish appropriate endorsements and transfer documents if
required by the Company or the Trustee or conversion agent, and pay the funds,
if any, required pursuant to the terms of the Indenture. The Company may elect
to deliver, in lieu of shares of Common Stock, cash or a combination of cash
and shares of Common Stock to satisfy its Conversion Obligation. At any time on
or prior to the twenty-sixth Trading Day preceding the Maturity Date, the
Company may irrevocably elect to satisfy its Conversion Obligation with respect
to the principal amount of the Notes to be converted in cash, with any
remaining amount to be satisfied in shares of Common Stock, subject to the
terms and conditions of the Indenture.


 


On or prior to January 15,
2010, upon the occurrence of a Fundamental Change, the Company will pay, on the
Fundamental Change Repurchase Date, the applicable Make Whole Premium, if any,
to the holder hereof who surrenders this Note for conversion, or who tenders
this Note for repurchase, in connection with such Fundamental Change. In the
event the holder surrenders this Note for conversion in connection with such
Fundamental Change and the applicable Make Whole Premium is greater than zero,
accrued and unpaid interest on this Note to, but excluding, the Conversion Date
will also be paid in cash to such holder on the date the shares of Common Stock
or other consideration are delivered.


 


No adjustment in respect of
interest on any Note converted or dividends on any shares issued upon
conversion of such Note will be made upon any conversion except as set forth in
the next sentence. If this Note (or portion hereof) is surrendered for
conversion during the period from the 5:00 p.m., New York City time, on
any applicable Record Date for the payment of interest to 5:00 p.m., New
York City time, on the Business Day preceding the corresponding interest
payment date, this Note (or portion hereof being converted) must be accompanied
by payment, in 


 


A-6

















 


immediately available funds
or other funds acceptable to the Company, of an amount equal to the interest
otherwise payable on such interest payment date on the principal amount being
converted; provided that no such payment shall be required (1) if the
holder surrenders this Note for conversion in connection with a redemption and
the Company has specified a redemption date that is after a Record Date and on
or prior to the corresponding interest payment date, (2) if the holder
surrenders this Note in connection with a Fundamental Change and the Company
has specified a Fundamental Change Repurchase Date that is after a Record Date
and on or prior to the corresponding interest payment date or (3) to the
extent of any overdue interest, if any exists at the time of conversion with
respect to this Note. Notwithstanding the foregoing, in the case of Notes
submitted for conversion or exchange in connection with a Fundamental Change as
set forth in the Indenture, such Notes shall continue to represent the right to
receive the Make Whole Premium, if any, payable pursuant to the Indenture until
such Make Whole Premium is so paid.


 


No fractional shares will be
issued upon any conversion, but an adjustment and payment in cash will be made,
as provided in the Indenture, in respect of any fraction of a share which would
otherwise be issuable upon the surrender of any Note or Notes for conversion.


 


A Note in respect of which a
holder is exercising its right to require repurchase may be converted only if
such holder validly withdraws its election to exercise such right to require
repurchase in accordance with the terms of the Indenture.


 


Any Notes called for
redemption, unless surrendered for conversion by the holders thereof on or
before 5:00 p.m., New York City time, on the Trading Day preceding the
redemption date, may be deemed, to the fullest extent required by law, to be
redeemed from the holders of such Notes for an amount equal to the applicable
redemption price, together with accrued but unpaid interest to, but excluding,
the date fixed for redemption, by one or more investment banks or other
purchasers who may agree with the Company (i) to purchase such Notes from
the holders thereof and convert them into shares of the Common Stock and (ii) to
make payment for such Notes as aforesaid to the Trustee in trust for the
holders.


 


Upon surrender for
registration of transfer of any Note to the Note Registrar or any co-registrar,
and satisfaction of the requirements for such transfer set forth in the
Indenture, the Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Notes of any authorized denominations and of a like aggregate principal
amount and bearing such restrictive legends as may be required by this
Indenture. No service charge shall be made to any holder for any registration
of, transfer or exchange of Notes, but the Company may require payment by the
holder of a sum sufficient to cover any tax, assessment or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Notes.


 


The Company, the Trustee,
any Paying Agent, any conversion agent and any Note Registrar may deem the
Person in whose name this Note shall be registered upon the Note Register to
be, and may treat it as, the absolute owner of this Note (whether or not this
Note shall be overdue and notwithstanding any notation of ownership or other
writing thereon made by any Person other than the Company or any Note
Registrar) for the purpose of receiving payment of or on account of the
principal of, premium, if any, and interest on this Note, for conversion of
this Note and for all other purposes; and neither the Company nor the Trustee
nor any Paying Agent nor any conversion agent nor any Note Registrar shall be
affected by any notice to the contrary. All such payments so made to any holder
for the time being, or upon his order, shall be valid, and, to the extent of
the sum or sums so paid, effectual to satisfy and discharge the liability for
monies payable upon any this Note.


 


No recourse for the payment
of the principal of or any premium or interest on this Note, or for any claim
based hereon or otherwise in respect hereof, and no recourse under or upon any
obligation, covenant or agreement of the Company in the Indenture or any
supplemental indenture or in any Note, or because of the creation of any
indebtedness represented thereby, shall be had against any incorporator, stockholder,
member, manager, employee, agent, officer, director or subsidiary, as such,
past, present or future, of the Company or of any successor thereto, either
directly or through the Company or any of the Company’s subsidiaries or of any
successor thereto, whether by virtue of any constitution, statute or rule of
law or by the enforcement of any assessment or penalty or otherwise; it being
expressly understood that all such liability is hereby expressly waived and
released as a condition of, and as consideration for, the execution of the
Indenture and the issue of this Note.


 


In addition to the rights
provided to holders of Notes under the Indenture, holders shall have all the
rights set forth in the Registration Rights Agreement dated as of June 22,
2004 between the Company and the Initial Purchasers named therein (the “Registration
Rights Agreement”).


 


A-7

















 


ABBREVIATIONS


 


The following abbreviations,
when used in the inscription of the face of this Note, shall be construed as
though they were written out in full according to applicable laws or
regulations.


 


	
  TEN COM -

  	
  as tenants in common

  	
  UNIF GIFT MIN ACT -     
  Custodian       

  
	
  TEN ENT -

  	
  as tenant by the
  entireties

  	
   (Cust)      (Minor)

  
	
  JT TEN -

  	
  as joint tenants with
  right of

  	
  under Uniform Gifts to
  Minors Act

  
	
   

  	
  survivorship and not as
  tenants in common

  	
   

  
	
   

  	
   

  	
                      (State)

  



 


Additional abbreviations may also be used though not in the above list.


 


A-8
















 


CONVERSION NOTICE


 


TO:
ADVANCED MEDICAL OPTICS, INC.


 


U.S. BANK NATIONAL ASSOCIATION, as Trustee


 


The undersigned registered
owner of this Note hereby irrevocably exercises the option to convert this
Note, or the portion thereof (which is $1,000 or a multiple thereof) below
designated, into shares of Common Stock of Advanced Medical Optics, Inc.
(or cash or a combination of cash and shares of Common Stock, as Advanced
Medical Optics, Inc. may so elect) in accordance with the terms of the
Indenture referred to in this Note, and directs that the shares, if any,
issuable and deliverable upon such conversion, together with any check in
payment for cash, if any, payable upon conversion or for fractional shares and
any Notes representing any unconverted principal amount hereof, be issued and
delivered to the registered holder hereof unless a different name has been
indicated below. Capitalized terms used herein but not defined shall have the
meanings ascribed to such terms in the Indenture. If shares or any portion of
this Note not converted are to be issued in the name of a person other than the
undersigned, the undersigned will provide the appropriate information below and
pay all transfer taxes payable with respect thereto. Any amount required to be
paid by the undersigned on account of interest accompanies this Note.


Dated:
______________________


 


 


Signature(s)


 


Signature(s) must
be guaranteed by an “eligible guarantor institution” meeting the requirements
of the Note Registrar, which requirements include membership or participation in
the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature
guarantee program” as may be determined by the Note Registrar in addition to, or
in substitution for, STAMP, all in accordance with the Securities Exchange Act
of 1934, as amended.


 


__________________________________________


 


Signature Guarantee


 


A-9

















 


Fill in the registration of
shares of Common Stock, if any, if to be issued, and Notes if to be delivered,
and the person to whom cash, if any, and payment for fractional shares is to be
made, if to be made, other than to and in the name of the registered holder:


 


	
  Please print name and
  address

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  (Name)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  (Street Address)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  (City, State and Zip Code)

  	
   

  
	
   

  	
   

  
	
  Principal amount to be
  converted

  	
   

  
	
  (if less than all):

  	
   

  
	
   

  	
   

  
	
  $_______________________

  	
   

  
	
   

  	
   

  
	
  Social Security or Other
  Taxpayer

  	
   

  
	
  Identification Number:

  	
   

  
	
   

  	
   

  



 


NOTICE: The signature on
this Conversion Notice must correspond with the name as written upon the face
of the Note in every particular without alteration or enlargement or any change
whatever.


 


A-10

















 


REPURCHASE NOTICE


 


TO:
ADVANCED MEDICAL OPTICS, INC.


 


U.S. BANK NATIONAL ASSOCIATION


 


The undersigned registered
owner of this Note hereby irrevocably acknowledges receipt of a notice from
Advanced Medical Optics, Inc. (the “Company”) regarding the right of
holders to elect to require the Company to repurchase the Notes and requests
and instructs the Company to repay the entire principal amount of this Note, or
the portion thereof (which is $1,000 or an integral multiple thereof) below
designated, in accordance with the terms of the Indenture at the price of 100%
of such entire principal amount or portion thereof, together with accrued and
unpaid interest to, but excluding, the Repurchase Date or the Fundamental
Change Repurchase Date, as the case may be, to the registered holder hereof.
Capitalized terms used herein but not defined shall have the meanings ascribed
to such terms in the Indenture. The Notes shall be repurchased by the Company
as of the Repurchase Date or the Fundamental Change Repurchase Date, as the
case may be, pursuant to the terms and conditions specified in the Indenture.
If the Company elects to pay the repurchase price, in whole or in part, in
shares of Common Stock or Applicable Stock, as the case may be, but is unable
to deliver the shares prior to 5:00 p.m., New York City time, on the
applicable Repurchase Date or the Fundamental Change Repurchase Date, as the
case may be, the undersigned registered owner elects:


 


o to withdraw this Repurchase Notice as to $[
] principal amount of the Notes to which this Repurchase Notice relates
(Certificate Numbers: ), or


 


o to receive cash in respect of $[ ] principal
amount of the Notes to which this Repurchase Notice relates.


 


	
   

  	
  Dated:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Signature(s):

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  



 


If no choice is indicated,
the holder will be deemed to have elected to receive cash in respect of the
entire repurchase price for all Notes subject to this repurchase notice.


 


NOTICE: The above signatures
of the holder(s) hereof must correspond with the name as written upon the
face of the Note in every particular without alteration or enlargement or any
change whatever.


 


Note Certificate Number (if
applicable):


 


Principal amount to be
repurchased (if less than all, must be $1,000 or whole multiples thereof):


 


Social Security or Other Taxpayer Identification Number 


 


A-11

















 


ASSIGNMENT


 


For value received                                                
hereby sell(s) assign(s) and transfer(s) unto                                                         
(Please insert social security or other Taxpayer Identification Number of assignee)
the within Note, and hereby irrevocably constitutes and appoints                                                                 
attorney to transfer said Note on the books of the Company, with full power of
substitution in the premises.


 


In connection with any
transfer of the Note prior to the expiration of the holding period applicable
to sales thereof under Rule 144(k) under the Securities Act (or any
successor provision) (other than any transfer pursuant to a registration
statement that has been declared effective under the Securities Act), the
undersigned confirms that such Note is being transferred:


 


o To Advanced Medical Optics, Inc. or a
subsidiary thereof; or


 


o To a “qualified institutional buyer” in
compliance with Rule 144A under the Securities Act of 1933, as amended; or


 


o Pursuant to and in compliance with Rule 144
under the Securities Act of 1933, as amended; or


 


o Pursuant to a Registration Statement which
has been declared effective under the Securities Act of 1933, as amended, and
which continues to be effective at the time of transfer;


 


and unless the Note has been
transferred to Advanced Medical Optics, Inc. or a subsidiary thereof, the
undersigned confirms that such Note is not being transferred to an “affiliate”
of the Company as defined in Rule 144 under the Securities Act of 1933, as
amended.


 


Unless one of the boxes is
checked, the Trustee will refuse to register any of the Notes evidenced by this
certificate in the name of any person other than the registered holder thereof.


 


A-12

















 


	
  Dated:

  	
   

  	
   

  



 


 


Signature(s)


 


Signature(s) must
be guaranteed by an “eligible guarantor institution” meeting the requirements
of the Note Registrar, which requirements include membership or participation in
the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature
guarantee program” as may be determined by the Note Registrar in addition to, or
in substitution for, STAMP, all in accordance with the Securities Exchange Act
of 1934, as amended.


 


________________________________________


 


Signature Guarantee


 


NOTICE: The signature on
this Assignment must correspond with the name as written upon the face of the
Note in every particular without alteration or enlargement or any change whatever.


 


A-13

















 


EXHIBIT B


 


FORM OF RESTRICTIVE LEGEND FOR

COMMON STOCK ISSUED UPON CONVERSION(2)


 


THE SECURITY EVIDENCED BY
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT OF 1933”), OR ANY STATE SECURITIES LAWS, AND MAY NOT
BE OFFERED OR SOLD EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE BY ACQUISITION
HEREOF. THE HOLDER:


 


(1) REPRESENTS THAT IT
IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT OF 1933; AND


 


(2) AGREES THAT IT WILL
NOT, WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THE SECURITY UPON THE
CONVERSION OF WHICH THE COMMON STOCK EVIDENCED HEREBY WAS ISSUED, RESELL OR
OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY EXCEPT (A) TO ADVANCED
MEDICAL OPTICS, INC. (THE “COMPANY”) OR ANY SUBSIDIARY THEREOF, (B) PURSUANT
TO THE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT OF 1933 (IF AVAILABLE), (C) PURSUANT
TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT OF 1933 AND WHICH CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH
TRANSFER.


 


THE HOLDER OF THIS SECURITY
IS ENTITLED TO THE BENEFITS OF A REGISTRATION RIGHTS AGREEMENT (AS SUCH TERM IS
DEFINED IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF) AND, BY ITS
ACCEPTANCE HEREOF, AGREES TO BE BOUND BY AND TO COMPLY WITH THE PROVISIONS OF
SUCH REGISTRATION RIGHTS AGREEMENT.


 






(2) This legend should be
included only if the Security is a Transfer Restricted Security.


 


A-14