Exhibit 4.3


 


 


SILICON GRAPHICS, INC.


 


6.50% Senior Convertible Notes Due
2009


 


 


INDENTURE


 


Dated as of           , 2003


 


 


U.S. BANK NATIONAL ASSOCIATION

TRUSTEE


 


 

















 


 


TABLE OF
CONTENTS(1)












 


	
   

  	
   

  	
  PAGE

  
	
  Article 1

  
	
  DEFINITIONS AND INCORPORATION BY REFERENCE

  
	
   

  	
   

  	
   

  
	
  Section 1.01.  Definitions.

  	
   

  	
    1

  
	
  Section 1.02.  Other Definitions.

  	
   

  	
    7

  
	
  Section
  1.03.  Incorporation by Reference of TIA

  	
   

  	
    8

  
	
  Section
  1.04.  Rules of Construction

  	
   

  	
    8

  
	
   

  	
   

  	
   

  
	
  Article 2

  
	
  THE SECURITIES

  
	
   

  	
   

  	
   

  
	
  Section 2.01.  Form and Dating

  	
   

  	
    8

  
	
  Section
  2.02.  Execution And Authentication

  	
   

  	
    9

  
	
  Section
  2.03.  Registrar, Paying Agent and
  Conversion Agent

  	
   

  	
    9

  
	
  Section
  2.04.  Paying Agent to Hold Money and
  Securities in Trust

  	
   

  	
  10

  
	
  Section 2.05.  Securityholder Lists

  	
   

  	
  10

  
	
  Section
  2.06.  Exchange and Registration of Transfer
  of Securities; Depositary

  	
   

  	
  10

  
	
  Section
  2.07.  Replacement Securities

  	
   

  	
  13

  
	
  Section
  2.08.  Outstanding Securities;
  Determinations of Holders’ Action

  	
   

  	
  13

  
	
  Section 2.09.  Temporary Securities

  	
   

  	
  14

  
	
  Section 2.10.  Cancellation

  	
   

  	
  15

  
	
  Section
  2.11.  Persons Deemed Owners

  	
   

  	
  15

  
	
  Section
  2.12.  Payment of Interest; Interest Rights
  Preserved

  	
   

  	
  15

  
	
  Section
  2.13.  Computation of Interest

  	
   

  	
  17

  
	
  Section
  2.14.  Preservation of Information;
  Communications to Holders

  	
   

  	
  17

  
	
   

  	
   

  	
   

  
	
  Article 3

  
	
  REDEMPTION

  
	
   

  	
   

  	
   

  
	
  Section
  3.01.  Right to Redeem; Notices to Trustee

  	
   

  	
  17

  
	
  Section
  3.02.  Selection of Securities to be
  Redeemed

  	
   

  	
  17

  
	
  Section 3.03.  Notice of Redemption

  	
   

  	
  18

  
	
  Section
  3.04.  Effect of Notice of Redemption

  	
   

  	
  19

  
	
  Section
  3.05.  Deposit of Redemption Price

  	
   

  	
  19

  
	
  Section
  3.06.  Securities Redeemed in Part

  	
   

  	
  19

  



 












(1) This Table of Contents shall not, for any
purpose, be deemed to be part of the Indenture.


 


i

















 


 


	
  Section
  3.07.  Conversion Arrangement on Call for
  Redemption

  	
   

  	
  19

  
	
  Section
  3.08.  Redemption at Option of the Holder
  upon a Fundamental Change

  	
   

  	
  20

  
	
   

  	
   

  	
   

  
	
  Article 4

  
	
  COVENANTS

  
	
   

  	
   

  	
   

  
	
  Section
  4.01.  Payment of Securities

  	
   

  	
  23

  
	
  Section 4.02.  SEC Reports

  	
   

  	
  24

  
	
  Section
  4.03.  Compliance Certificate

  	
   

  	
  24

  
	
  Section
  4.04.  Further Instruments and Acts

  	
   

  	
  24

  
	
  Section
  4.05.  Maintenance of Office or Agency

  	
   

  	
  24

  
	
  Section
  4.06.  Restriction on Additional
  Indebtedness

  	
   

  	
  25

  
	
  Section 4.07.  Restricted Payments

  	
   

  	
  26

  
	
   

  	
   

  	
   

  
	
  Article 5

  
	
  SUCCESSOR CORPORATION

  
	
   

  	
   

  	
   

  
	
  Section
  5.01.  When Company May Merge or Transfer
  Assets

  	
   

  	
  26

  
	
   

  	
   

  	
   

  
	
  Article 6

  
	
  DEFAULTS AND REMEDIES

  
	
   

  	
   

  	
   

  
	
  Section 6.01.  Events of Default

  	
   

  	
  27

  
	
  Section 6.02.  Acceleration

  	
   

  	
  28

  
	
  Section 6.03.  Other Remedies

  	
   

  	
  29

  
	
  Section
  6.04.  Waiver of Past Defaults

  	
   

  	
  29

  
	
  Section 6.05.  Control by Majority

  	
   

  	
  29

  
	
  Section 6.06.  Limitation on Suits

  	
   

  	
  29

  
	
  Section
  6.07.  Rights of Holders to Receive Payment

  	
   

  	
  30

  
	
  Section
  6.08.  Collection Suit by Trustee

  	
   

  	
  30

  
	
  Section
  6.09.  Trustee May File Proofs of Claim

  	
   

  	
  30

  
	
  Section 6.10.  Priorities

  	
   

  	
  31

  
	
  Section
  6.11.  Undertaking for Costs

  	
   

  	
  32

  
	
  Section
  6.12.  Waiver of Stay, Extension or Usury
  Laws

  	
   

  	
  32

  
	
   

  	
   

  	
   

  
	
  Article 7

  
	
  TRUSTEE

  
	
   

  	
   

  	
   

  
	
  Section 7.01.  Duties of Trustee

  	
   

  	
  32

  
	
  Section 7.02.  Rights Of Trustee

  	
   

  	
  33

  
	
  Section
  7.03.  Individual Rights of Trustee

  	
   

  	
  33

  
	
  Section 7.04.  Trustee’s Disclaimer

  	
   

  	
  34

  
	
  Section 7.05.  Notice of Defaults

  	
   

  	
  34

  
	
  Section
  7.06.  Disqualification; Conflicting
  Interests

  	
   

  	
  34

  



 


 


ii

















 


 


	
  Section
  7.07.  Compensation and Indemnity

  	
   

  	
  34

  
	
  Section
  7.08.  Replacement of Trustee

  	
   

  	
  35

  
	
  Section
  7.09.  Successor Trustee by Merger

  	
   

  	
  36

  
	
  Section
  7.10.  Eligibility; Disqualification

  	
   

  	
  36

  
	
  Section
  7.11.  Preferential Collection of Claims
  Against Company

  	
   

  	
  36

  
	
  Section 7.12.  Reports By Trustee.

  	
   

  	
  36

  
	
   

  	
   

  	
   

  
	
  Article 8

  
	
  DISCHARGE OF INDENTURE

  
	
   

  	
   

  	
   

  
	
  Section
  8.01.  Discharge of Liability on Securities

  	
   

  	
  36

  
	
  Section
  8.02.  Repayment to the Company

  	
   

  	
  37

  
	
   

  	
   

  	
   

  
	
  Article 9

  
	
  AMENDMENTS

  
	
   

  	
   

  	
   

  
	
  Section
  9.01.  Without Consent Of Holders

  	
   

  	
  37

  
	
  Section
  9.02.  With Consent of Holders

  	
   

  	
  38

  
	
  Section 9.03.  Compliance with TIA

  	
   

  	
  38

  
	
  Section
  9.04.  Revocation and Effect of Consents,
  Waivers and Actions

  	
   

  	
  38

  
	
  Section
  9.05.  Notation on or Exchange of Securities

  	
   

  	
  39

  
	
  Section
  9.06.  Trustee to Sign Supplemental
  Indentures

  	
   

  	
  39

  
	
  Section
  9.07.  Effect of Supplemental Indentures

  	
   

  	
  39

  
	
   

  	
   

  	
   

  
	
  Article 10

  
	
  CONVERSION

  
	
   

  	
   

  	
   

  
	
  Section
  10.01.  Conversion Privilege

  	
   

  	
  39

  
	
  Section
  10.02.  Conversion Procedure

  	
   

  	
  40

  
	
  Section 10.03.  Fractional Shares

  	
   

  	
  41

  
	
  Section
  10.04.  Taxes on Conversion

  	
   

  	
  41

  
	
  Section
  10.05.  Company to Provide Stock

  	
   

  	
  41

  
	
  Section
  10.06.  Adjustment for Change in Capital
  Stock

  	
   

  	
  42

  
	
  Section
  10.07.  Adjustment for Rights Issue

  	
   

  	
  42

  
	
  Section
  10.08.  Adjustment for Other Distributions

  	
   

  	
  43

  
	
  Section
  10.09.  When Adjustment May be Deferred

  	
   

  	
  47

  
	
  Section
  10.10.  When no Adjustment Required

  	
   

  	
  47

  
	
  Section
  10.11.  Notice of Adjustment

  	
   

  	
  47

  
	
  Section 10.12.  Voluntary Decrease

  	
   

  	
  47

  
	
  Section
  10.13.  Notice Of Certain Transactions

  	
   

  	
  48

  
	
  Section
  10.14.  Effect of Reclassification,
  Consolidation, Merger or Sale

  	
   

  	
  48

  
	
  Section
  10.15.  Company Determination Final

  	
   

  	
  49

  
	
  Section
  10.16.  Trustee’s Adjustment Disclaimer

  	
   

  	
  49

  
	
  Section
  10.17.  Simultaneous Adjustment

  	
   

  	
  49

  
	
  Section
  10.18.  Successive Adjustments

  	
   

  	
  49

  



 


 


iii

















 


 


	
  Section
  10.19.  Rights Issued in Respect of Common
  Stock Issued Upon Conversion

  	
   

  	
  49

  
	
  Section
  10.20.  General Considerations

  	
   

  	
  51

  
	
   

  	
   

  	
   

  
	
  Article 11

  
	
  MISCELLANEOUS

  
	
   

  	
   

  	
   

  
	
  Section 11.01.  Conflict with TIA

  	
   

  	
  51

  
	
  Section 11.02.  Notices

  	
   

  	
  51

  
	
  Section
  11.03.  Communication by Holders with Other
  Holders

  	
   

  	
  52

  
	
  Section
  11.04.  Certificate And Opinion as to
  Conditions Precedent

  	
   

  	
  52

  
	
  Section
  11.05.  Statements Required in Certificate or
  Opinion

  	
   

  	
  52

  
	
  Section
  11.06.  Separability Clause

  	
   

  	
  53

  
	
  Section
  11.07.  Rules by Trustee, Paying Agent,
  Conversion Agent and Registrar

  	
   

  	
  53

  
	
  Section 11.08.  Legal Holidays

  	
   

  	
  53

  
	
  Section 11.09.  Governing Law

  	
   

  	
  53

  
	
  Section
  11.10.  No Recourse Against Others

  	
   

  	
  53

  
	
  Section 11.11.  Successors

  	
   

  	
  53

  
	
  Section 11.12.  Multiple Originals

  	
   

  	
  53

  
	
   

  	
   

  	
   

  
	
  Exhibit A — Form of Security

  	
   

  	
  A-1

  



 


 


 


iv

















 


INDENTURE, dated as of          , 2003, between SILICON GRAPHICS, INC., a Delaware
corporation (the “Company”), and U.S. BANK NATIONAL
ASSOCIATION, a national banking association organized and existing under the laws
of the United States of America (the “Trustee”).


Each party agrees as follows for the benefit of the
other party and for the equal and ratable benefit of the Holders of the
Company’s 6.50% Senior Convertible Notes Due 2009 (the “Securities”):


ARTICLE
1

DEFINITIONS AND INCORPORATION BY REFERENCE


Section 1.01.  Definitions.


“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.


“Average Life” means, with respect to any
indebtedness, the quotient obtained by dividing the sum of the products of (1)
the number of years from the date of determination to the dates of each
successive scheduled principal payment on such indebtedness, and (2) the amount
of such principal payment, by the sum of all such principal payments.


“Board of Directors” means either the board
of directors of the Company or any duly authorized committee of such board.


“Business Day” means each day of the year on
which banking institutions are not required or authorized to close in The City
of New York or at the principal corporate trust office of the Trustee.


“Capital Stock” means (1) in the case of a
corporation, corporate stock, (2) in the case of an association or business
entity, any and all shares, interests, participations, rights or other
equivalents (however designated) of corporate stock, (3) in the case of a
partnership, partnership interests (whether general or limited), and (4) any
other interest or participation that confers on a person the right to receive a
share of the profits and losses of, or distribution of assets of, the issuing
person.


 

















 


“Closing Price” means with respect to any
securities on any day the closing sale price regular way on such day or, in
case no such sale takes place on such day, the average of the reported closing
bid and asked prices, regular way, in each case on the New York Stock Exchange,
or, if such security is not listed or admitted to trading on such Exchange, on
the principal national security exchange or quotation system on which such
security is quoted or listed or admitted to trading, or, if not quoted or
listed or admitted to trading on any national securities exchange or quotation
system, the average of the closing bid and asked prices of such security on the
over-the-counter market on the day in question as reported by the National
Quotation Bureau Incorporated, or a similar generally accepted reporting
service, or if not so available, in such manner as furnished by any New York
Stock Exchange member firm selected from time to time by the Board of Directors
for that purpose, or a price determined in good faith by the Board of Directors
or, to the extent permitted by applicable law, a duly authorized committee
thereof, whose determination shall be conclusive.


“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 10.14, however, shares issuable on conversion of the Securities shall
include only shares of Common Stock, par value $.00l per share, of the Company
as it exists on the date of this Indenture 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 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 party named as the “Company”
in the first paragraph of this Indenture until a successor replaces it pursuant
to the applicable provisions of this Indenture and, thereafter, shall mean such
successor.  The foregoing sentence shall
likewise apply to any subsequent such successor or successors.


“Company Request” or “Company Order” means a
written request or order signed in the name of the Company by its Chairman of
the Board, a Vice Chairman, its President, a Senior Vice President or a Vice
President, and by its Treasurer, an Assistant Treasurer, its Secretary or an
Assistant Secretary, and delivered to the Trustee.


 


2

















 


“Conversion Price” has the meaning specified
in Section 10.01.


“Current Market Price” per share of Common
Stock at any date shall be the average of the last reported sale prices for the
ten consecutive Trading Days preceding the day before the record date with
respect to any distribution, issuance or other event requiring such
computation.  The last reported sale
price for each day shall be (i) the last reported sale price of Common Stock on
the New York Stock Exchange, or, if such security is not listed or admitted to
trading on such Exchange, on the principal national security exchange on which
such security is listed, or on the Nasdaq National Market or any similar system
of automated dissemination of quotations of securities prices then in common
use, if so quoted, or (ii) if not quoted as described in clause (i), the mean
between the high bid and low asked quotations for Common Stock as reported by
the National Quotation Bureau Incorporated if at least two securities dealers
have inserted both bid and asked quotations for the Common Stock on at least 5
of the 10 preceding days, or (iii) if the Common Stock is listed or admitted
for trading on any national securities exchange, the last sale price, or the
closing bid price if no sale occurred, of the Common Stock on the principal
securities exchange on which the Common Stock is listed.  If the Common Stock is quoted on a national
securities or central market system, in lieu of a market or quotation system described
above, the last reported sale price shall be determined in the manner set forth
in clause (ii) of the preceding sentence if bid and asked quotations are
reported but actual transactions are not, and in the manner set forth in clause
(iii) of the preceding sentence if actual transactions are reported.  If none of the conditions set forth above is
met, the last reported sale price of Common Stock on any day or the average of
such last reported sale prices for any period shall be the fair market value of
the Common Stock as determined by a member firm of the New York Stock Exchange,
Inc.  selected by the Company.


“Custodian” means U.S. Bank National
Association, as custodian with respect to any Global Security, or any
successor.


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


“Defaulted Interest” has the meaning
specified in Section 2.12.


“Depositary” means, with respect to the
Securities issuable or issued in whole or in part in global form, the person
specified in Section 2.06 as the Depositary with respect to the Securities,
until a successor Depositary shall have been appointed and become such pursuant
to the applicable provisions of this Indenture, and thereafter, “Depositary”
shall mean or include such successor.


 


3

















 


“Disqualified Stock” means Capital Stock
that, by its terms (or the terms of any security into which it is convertible
or for which it is exchangeable), or upon the happening of any event, matures
or is mandatorily redeemable, pursuant to a sinking fund obligation or
otherwise, or is redeemable at the option of the holder, in whole or in part,
on or prior to the date that is the Stated Maturity of the New Notes and the
Securities.


“Event of Default” means any event or condition
specified as such in Section 6.01.


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


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


“Global Security” means a Security that is
registered in the Security Register in the name of the Depository or a nominee
thereof.


“Holder” or “Securityholder” means a
Person in whose name a Security is registered on the Registrar’s books.


“Indenture” means this Indenture, as amended
or supplemented from time to time in accordance with the terms hereof.


“Interest Payment Date” means the Stated
Maturity of an installment of interest on the Securities.


“Interest Period” shall have the meaning set
forth in Section 10.02.


“Maturity” when used with respect to any
Security, means the date on which the principal of such Security becomes due and
payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, call for redemption, redemption upon a Fundamental
Change or otherwise.


“New Indenture” means that certain Indenture
dated as of           , 2003 among the
Company and the Trustee, relating to the New Notes.


“New Notes” means the Company’s 11.75%
Senior Notes Due 2009.


 


4

















 


“Officer” means the Chairman of the Board,
any Vice Chairman, the President, any Senior Vice President, any Vice
President, the Treasurer or the Secretary or any Assistant Treasurer or
Assistant Secretary of the Company.


“Officers’ Certificate” means a written
certificate containing the information specified in Sections 11.04 and 11.05,
signed in the name of the Company by its Chairman of the Board, a Vice
Chairman, its President, a Senior Vice President or a Vice President, and by
its Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary,
and delivered to the Trustee.


“Old Notes” means the Company’s 5 1/4%
Senior Convertible Notes Due 2004.


“Old Notes Indenture” means that certain
Indenture dated as of September 1, 1997 among the Company and the U.S. Bank
National Association, as successor trustee to State Street Bank and Trust
Company of California, N.A., relating to the Old Notes.


“Opinion of Counsel” means a written opinion
signed by legal counsel who may be an employee of or counsel to the Company and
who shall be satisfactory to the Trustee. 
Each such opinion shall comply with Section 314 of the Trust Indenture
Act and include the information specified in Sections 11.04 and 11.05.


“Options” means any warrants, options or
other rights to acquire Capital Stock of the Company (but excluding (i) any
options or other rights issued under a plan maintained by the Company for the
benefit of employees, directors and consultants, and (ii) any debt security
that is convertible into or exchangeable for Capital Stock of the Company).


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


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


“Redemption Date” shall mean a date
specified for redemption of the Securities (other than redemption upon a
Fundamental Change at the option of the Securityholder) in accordance with the
terms of the Securities and Section 3.01 of this Indenture.


 


5

















 


“Redemption Price” shall have the meaning
set forth in paragraph 5 of the Securities.


“Regular Record Date” for the interest
payable on any Interest Payment Date means the December 15 or June 15 (whether
or not a Business Day), as the case may be, next preceding such Interest
Payment Date.


“SEC” means the Securities and Exchange
Commission.


“Secured Credit Facility” means that certain
Amended and Restated Loan and Security Agreement between the Company and
Foothill Capital Corporation and the Bank of America, N.A. dated September 24,
2002, as amended by that certain Amendment Number One to Amended and Restated
Loan Agreement, dated as of April 11, 2003, among the Company and Foothill
Capital Corporation, as the same may be amended from time to time.


“Security” or “Securities” means any of the
Company’s 6.25% Senior Convertible Notes due 2009, as amended or supplemented
from time to time, issued under this Indenture.


“Securities Act” means the Securities Act of
1933, as amended, and the rules and regulations of the SEC promulgated
thereunder.


“Securityholder” or “Holder” means a person in
whose name a Security is registered on the Registrar’s books.


“Security Register” has the meaning
specified in Section 2.05.


“SGI Japan Secured Debt” means that Loan
Agreement between the Company, Silicon Graphics World Trade B.V. and SGI Japan,
Ltd. as of November 9, 2001, as the same may be amended from time to time.


“Special Record Date” for the payment of any
Defaulted Interest means a date fixed by the Trustee pursuant to Section 2.12.


“Stated Maturity” when used with respect to
any Security or any installment of interest thereon, means the date specified
in such Security as the fixed date on which the principal of such Security or
such installment of interest is due and payable, and when used with respect to
any other indebtedness or any installment of interest thereon, the date
specified as the fixed date on which the principal of such debt or such
installment of interest is due and payable as set forth in the documentation
governing that debt, not including any contingent obligation to repay, redeem
or repurchase prior to the regularly scheduled date for payment.


 


6

















 


“Subsidiary” means a corporation of which a
majority of the capital stock (which for purposes of this definition means any
and all shares, interests, rights to purchase, warrants, options,
participations or other equivalents of or interests in (however designated)
stock issued by such corporation) having voting power under ordinary
circumstances to elect a majority of the board of directors of such corporation
is owned directly or indirectly by (i) the Company, (ii) the Company and one or
more Subsidiaries or (iii) one or more Subsidiaries.


“TIA” means the Trust Indenture Act of 1939
as in effect on the date of this Indenture, except as provided in Section 9.03.


“Trading Day” means a day during which
trading in securities generally occurs on the New York Stock Exchange or, if
the applicable security is not listed on the New York Stock Exchange, on the
principal other national or regional securities exchange on which the
applicable security is then listed or, if the applicable security is not listed
on a national or regional securities exchange, on the Nasdaq National Market
or, if the applicable security is not quoted on the Nasdaq National Market, on
the principal other market on which the applicable security is then traded.


“Trust Officer” means any officer of the
Trustee assigned by the Trustee to administer its corporate trust matters.


“Trustee” means the party named as the
“Trustee” in the first paragraph of this Indenture until a successor replaces
it pursuant to the applicable provisions of this Indenture and, thereafter,
shall mean such successor.  The
foregoing sentence shall likewise apply to any subsequent such successor or
successors.


Section 1.02.  Other Definitions.


	
  Term

  	
   

  	
  Defined in

  Section

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Bankruptcy Law

  	
   

  	
  6.01

  	
   

  
	
  Company Notice

  	
   

  	
  3.08

  	
   

  
	
  Conversion Agent

  	
   

  	
  2.03

  	
   

  
	
  Event of Default

  	
   

  	
  6.01

  	
   

  
	
  Fundamental Change Repurchase Date

  	
   

  	
  3.08

  	
  (a)

  
	
  Fundamental Change Redemption Price

  	
   

  	
  3.08

  	
  (a)

  
	
  Incur

  	
   

  	
  4.06

  	
   

  
	
  Legal Holiday

  	
   

  	
  11.08

  	
   

  
	
  Notice of Default

  	
   

  	
  6.01

  	
   

  
	
  Paying Agent

  	
   

  	
  2.03

  	
   

  
	
  Registrar

  	
   

  	
  2.03

  	
   

  



 


 


7

















 


 


Section 1.03.  Incorporation by Reference of TIA. 
Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture.  The following TIA terms used in this
Indenture have the following meanings:


“Commission” means the SEC.


“Indenture Securities” means the Securities.


“Indenture Security Holder” means a
Securityholder.


“Indenture to be Qualified” means this
Indenture.


“Indenture Trustee” or “Institutional Trustee” means
the Trustee.


“Obligor” on the indenture securities means
the Company.


All other TIA terms used in this Indenture that are
defined by the TIA, defined by TIA reference to another statute or defined by
SEC rule have the meanings assigned to them by such definitions.


Section 1.04.  Rules of Construction. 
Unless the context otherwise requires:


(a)   a term has the meaning assigned to it;


(b)   an accounting term not otherwise defined has
the meaning assigned to it in accordance with generally accepted accounting
principles as in effect from time to time;


(c)   “or” is not exclusive;


(d)   “including” means including, without limitation;
and


(e)   words in the singular include the plural, and
words in the plural include the singular.


ARTICLE
2

THE SECURITIES


Section 2.01.  Form and Dating. 
The Securities and the Trustee’s certificate of authentication shall be
substantially in the form of Exhibit A, which is a part of this Indenture.  The Securities may have notations, legends
or endorsements required by law, stock exchange rule or usage (provided that
any such notation, legend or endorsement required by usage is in a form
acceptable to 


 


8

















 


the
Company).  The Company shall provide any
such notations, legends or endorsements to the Trustee in writing.  Each Security shall be dated the date of its
authentication.


Section 2.02.  Execution And Authentication. 
The Securities shall be executed on behalf of the Company by its
Chairman of the Board, one of its Vice Chairman, its President, one of its
Senior Vice Presidents or one of its Vice Presidents, under its corporate seal
reproduced thereon and attested by its Secretary or one of its Assistant
Secretaries.  The signature of any of
these officers on the Securities may be manual or facsimile.


Securities bearing the manual or facsimile
signatures of individuals who were at any time the proper Officers of the
Company shall bind the Company, notwithstanding that such individuals or any of
them have ceased to hold such offices prior to the authentication and delivery
of such Securities or did not hold such offices at the date of authentication of
such Securities.


No Security shall be entitled to any benefit under
this Indenture or be valid or obligatory for any purpose unless there appears
on such Security a certificate of authentication substantially in the form
provided for herein duly executed by the Trustee by manual signature of an
authorized officer, and such certificate upon any Security shall be conclusive
evidence, and the only evidence, that such Security has been duly authenticated
and delivered hereunder.


The Trustee shall authenticate and deliver
Securities for original issue in an aggregate principal amount of up to
$120,000,000 upon a Company Order without any further action by the
Company.  The aggregate principal amount
of Securities outstanding at any time may not exceed the amount set forth in
the foregoing sentence, except as provided in Section 2.07.


Section 2.03.  Registrar, Paying Agent and Conversion
Agent.  The Company shall maintain
an office or agency where Securities may be presented for registration of
transfer or for exchange (“Registrar”), an office or agency where
Securities may be presented for purchase or payment (“Paying Agent”) and an office
or agency where Securities may be presented for conversion (“Conversion
Agent”).  The Registrar shall
keep a register (the “Security Register”) of the Securities and
of their transfer and exchange.  The
Company may have one or more co-registrars, one or more additional paying
agents and one or more additional conversion agents.  The term Paying Agent includes any additional paying agent.  The term Conversion Agent includes any
additional conversion agent.


The Company shall enter into an appropriate agency
agreement with any Registrar, Paying Agent, Conversion Agent or co-registrar
(if not the Trustee).  The agreement
shall implement the provisions of this Indenture that relate to such 


 


9

















 


agent. The Company shall
notify the Trustee of the name and address of any such agent.  If the Company fails to maintain a
Registrar, Paying Agent or Conversion Agent, the Trustee shall act as such and
shall be entitled to appropriate compensation therefor pursuant to Section
7.07. The Company or any Subsidiary or an Affiliate of either of them may act
as Paying Agent, Registrar, Conversion Agent or co-registrar.


The Company initially appoints the Trustee as
Registrar, Conversion Agent and Paying Agent in connection with the Securities.


Section 2.04.  Paying Agent to Hold Money and Securities in
Trust.  Except as otherwise provided
herein, prior to or on each due date of payments in respect of any Security,
the Company shall deposit with the Paying Agent a sum of money or securities
sufficient to make such payments when so becoming due.  The Company shall require each Paying Agent
(other than the Trustee) to agree in writing that the Paying Agent shall hold
in trust for the benefit of Securityholders or the Trustee all money and
securities held by the Paying Agent for the making of payments in respect of
the Securities and shall notify the Trustee of any default by the Company in
making any such payment.  At any time
during the continuance of any such default, the Paying Agent shall, upon the
written request of the Trustee, forthwith pay to the Trustee all money and
securities so held in trust.  If the Company,
a Subsidiary or an Affiliate of either of them acts as Paying Agent, it shall
segregate the money and securities held by it as Paying Agent and hold it as a
separate trust fund.  The Company at any
time may require a Paying Agent to pay all money and securities held by it to
the Trustee and to account for any funds and securities disbursed by it.  Upon doing so, the Paying Agent shall have
no further liability for the money or securities.


Section 2.05.  Securityholder Lists. 
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Securityholders.  If the Trustee is not
the Registrar, the Company shall cause to be furnished to the Trustee at least
semiannually on December 15 and June 15 a listing of Holders dated within 15
days of the date on which the list is furnished and at such other times as the
Trustee may request in writing a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of Securityholders.


Section 2.06.  Exchange and Registration of Transfer of
Securities; Depositary.  Upon surrender
for registration of transfer of any Security at any office or agency of the
Company designated as Registrar or co-registrar pursuant to Section 2.03 and
satisfaction of the requirements for such transfer set forth in this Section
2.06, the Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Securities of any authorized denominations and of a like aggregate
principal amount.


 


10

















 


Securities may be exchanged for a like aggregate
principal amount of Securities of other authorized denominations.  Securities to be exchanged shall be
surrendered at any office or agency to be maintained by the Company designated
as Registrar or co-registrar pursuant to Section 2.03 and the Company shall
execute and register and the Trustee shall authenticate and deliver in exchange
therefor the Security or Securities which the Securityholder making the
exchange shall be entitled to receive, bearing registration numbers not
contemporaneously outstanding.


All Securities presented for registration of
transfer or for exchange, purchase, redemption, conversion or payment shall (if
so required by the Company, the Trustee, the Registrar or any co-registrar) be
duly endorsed by, or be accompanied by a written instrument or instruments of
transfer in form satisfactory to the Company and the Trustee, duly executed by
the Holder or his attorney duly authorized in writing.


No service charge shall be charged to the
Securityholder for any exchange or registration of transfer of Securities, but
the Company may require payment of a sum sufficient to cover any tax,
assessments or other governmental charges that may be imposed in connection
therewith.


None of the Company, the Trustee, the Registrar or
any co-registrar shall be required to exchange or register a transfer of (a)
any Securities for a period of 15 days next preceding any selection of
Securities to be redeemed or (b) any Securities or portions thereof selected or
called for redemption or (c) any Securities or portion thereof surrendered for
conversion or (d) any Securities or portion thereof surrendered for redemption
(and not withdrawn) pursuant to Section 3.08.


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


The provisions of Clauses (a), (b), (c), (d), and
(e) below shall apply only to Global Securities:


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


(b)   Notwithstanding any other provision in this
Indenture, no Global Security may be exchanged in whole or in part for
Securities registered, and no 


 


11

















 


transfer of a Global
Security in whole or in party may be registered, in the name of any Person
other than the Depositary for such Global Security or a nominee thereof unless
(A) such Depositary (i) has notified the Company that it is unwilling or unable
to continue as Depositary for such Global Security or (ii) has ceased to be a
clearing agency registered under the Exchange Act, or (B) there shall have
occurred and be continuing an Event of Default with respect to such Global
Security.


(c)   Subject to 2.06(b) above, any exchange of a Global
Security for other Securities may be made in whole or in part, and all
Securities issued in exchange for a Global Security or any portion thereof
shall be registered in such names as the Depositary for such Global Security
shall direct.


(d)   Every Security authenticated and delivered
upon registration of transfer of, or in exchange for or in lieu of, a Global
Security or any portion thereof whether pursuant to this Article Two or
otherwise, shall be authenticated and delivered in the form of, and shall be, a
Global Security, unless such Security is registered in the name of a Person
other than the Depositary for such Global Security or a nominee thereof.


(e)   The Depositary or its nominee, as registered
own of a Global Security, shall be the Holder of such Global Security for all
purposes under the Indenture and the Securities, and owners of beneficial
interests in a Global Security shall hold such interests pursuant to the
applicable procedures.  Accordingly, any
such owner’s beneficial interest in a Global Security will be shown only on,
and the transfer of such interest shall be effected only through, records
maintained by the Depositary or its nominee or its agent members and such
owners of beneficial interests in a Global Security will not be considered the
owners or holders thereof.


The Depositary shall be a clearing agency registered
under the Exchange Act.  The Company
initially appoints The Depository Trust Company to act as Depositary with
respect to the Securities in global form. 
Initially, the Global Security shall be issued to the Depositary,
registered in the name of Cede & Co., as the nominee of the Depositary, and
deposited with the Trustee as custodian for Cede & Co.


If at any time the Depositary for the Global
Security notifies the Company that it is unwilling or unable to continue as
Depositary for such Global Security, the Company may appoint a successor
Depositary with respect to such Security. 
If a successor Depositary for the Global Security is not appointed by
the Company within 90 days after the Company receives such notice, the Company
will execute, and the Trustee, upon receipt of a Company Order for
authentication and delivery of Securities, will authenticate and deliver,
Securities in definitive 


 


12

















 


form, in an aggregate
principal amount equal to the principal amount of the Global Security, in
exchange for such Security in the global form.


Section 2.07.  Replacement Securities. 
If (i) any mutilated Security is surrendered to the Trustee, or (ii)
the Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Security, and there is delivered to the
Company and the Trustee such security or indemnity as may be required by them
to save each of them harmless, then, in the absence of notice to the Company or
the Trustee that such Security has been acquired by a bona fide purchaser, the
Company shall execute and upon its written request the Trustee shall
authenticate and deliver, in exchange for any such mutilated Security or in
lieu of any such destroyed, lost or stolen Security, a new Security of like
tenor and principal amount, bearing a number not contemporaneously outstanding.


In case any such mutilated, destroyed, lost or
stolen Security has become or is about to become due and payable, or is about
to be redeemed by the Company pursuant to Article 3 hereof, the Company in its
discretion may, instead of issuing a new Security, pay or redeem such Security,
as the case may be.


Upon the issuance of any new Securities under this
Section, the Company may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto and
any other expenses (including the fees and expenses of the Trustee) connected
therewith.


Every new Security issued pursuant to this Section
in lieu of any mutilated, destroyed, lost or stolen Security shall constitute
an original additional contractual obligation of the Company, whether or not
the destroyed, lost or stolen Security shall be at any time enforceable by
anyone, and shall be entitled to all benefits of this Indenture equally and
proportionately with any and all other Securities duly issued hereunder.


The provisions of this Section are exclusive and
shall preclude (to the extent lawful) all other rights and remedies with
respect to the replacement or payment of mutilated, destroyed, lost or stolen
Securities.


Section 2.08.  Outstanding Securities; Determinations of
Holders’ Action.  Securities
outstanding at any time are all the Securities authenticated by the Trustee
except for those canceled by it, those delivered to it for cancellation and
those described in this Section 2.08 as not outstanding.  A Security does not cease to be outstanding
because the Company or an Affiliate thereof holds the Security; provided,
however, that in determining whether the Holders of the requisite principal
amount of Securities have given or concurred in any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or such other obligor shall be disregarded and deemed not to be 


 


13

















 


outstanding,
except that, in determining whether the Trustee shall be protected in relying
upon any such request, demand, authorization, direction, notice, consent or
waiver, only Securities which the Trustee knows to be so owned shall be so
disregarded.  Subject to the foregoing, only
Securities outstanding at the time of such determination shall be considered in
any such determination (including, without limitation, determinations pursuant
to Articles 6 and 9).


If a Security is replaced pursuant to Section 2.07,
it ceases to be outstanding unless the Trustee receives proof satisfactory to
it that the replaced Security is held by a bona fide purchaser.


If the Paying Agent holds, in accordance with this
Indenture, on a Redemption Date, on a Fundamental Change Repurchase Date or on
Stated Maturity, money or securities, if permitted hereunder, sufficient to pay
Securities payable on that date, then on and after that date such Securities
shall cease to be outstanding and interest on such Securities shall cease to
accrue; provided, that if such Securities are to be redeemed, notice of such
redemption has been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made.


If a Security is converted in accordance with
Article 10, then from and after such conversion such Security shall cease to be
outstanding and interest shall cease to accrue on such Security.


Section 2.09.  Temporary Securities. 
Pending the preparation of definitive Securities, the Company may
execute, and upon Company Order the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed, typewritten, mimeographed
or otherwise produced, in any authorized denomination, substantially of the
tenor of the definitive Securities in lieu of which they are issued and with
such appropriate insertions, omissions, substitutions and other variations as
the officers executing such Securities may determine, as conclusively evidenced
by their execution of such Securities.


If temporary Securities are issued, the Company will
cause definitive Securities to be prepared without unreasonable delay.  After the preparation of definitive
Securities, the temporary Securities shall be exchangeable for definitive
Securities upon surrender of the temporary Securities at the office or agency
of the Company designated for such purpose pursuant to Section 2.03, without
charge to the Holder.  Upon surrender
for cancellation of any one or more temporary Securities the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
like principal amount of definitive Securities of authorized
denominations.  Until so exchanged the
temporary Securities shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities.


 


14

















 


Section 2.10.  Cancellation. 
All Securities surrendered for payment, conversion, redemption or
registration of transfer or exchange shall, if surrendered to any Person other
than the Trustee, be delivered to the Trustee and shall be promptly canceled by
it.  The Company may at any time deliver
to the Trustee for cancellation any Securities previously authenticated and
delivered hereunder which the Company may have acquired in any manner
whatsoever, and all Securities so delivered shall be promptly canceled by the
Trustee.  The Company may not issue new
Securities to replace Securities it has paid or delivered to the Trustee for
cancellation or that any Holder has converted pursuant to Article 10.  No Securities shall be authenticated in lieu
of or in exchange for any Securities canceled as provided in this Section,
except as expressly permitted by this Indenture.  All canceled Securities held by the Trustee shall be destroyed by
the Trustee and evidence of their destruction delivered to the Company unless
the Company directs by Company Order that the Trustee deliver canceled
Securities to the Company.


Section 2.11.  Persons Deemed Owners. 
Prior to due presentment of a Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name such Security is registered as the owner of such
Security for the purpose of receiving payment of principal amount, premium, if
any, interest, Redemption Price and Fundamental Change Redemption Price in
respect thereof, for the purpose of conversion and for all other purposes
whatsoever, whether or not such Security be overdue, and none of the Company,
the Trustee or any agent of the Company or the Trustee shall be affected by
notice to the contrary.


Section 2.12.  Payment of Interest; Interest Rights
Preserved.  Interest on any Security
which is payable, and is punctually paid or duly provided for, on any Interest
Payment Date shall be paid to the person in whose name that Security (or one or
more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest.


Any interest on any Security which is payable, but
is not punctually paid or dully provided for, on any Interest Payment Date
(herein called “Defaulted Interest”) shall forthwith cease to be payable to
the Holder on the relevant Regular Record Date by virtue of having been such
Holder, and such Defaulted Interest may be paid by the Company, at its election
in each case, as provided in (a) or (b) below:


(a)   The Company may elect to make payment of any
Defaulted Interest to the Persons in whose names the Securities (or their
respective Predecessor Securities) are registered at the close of business 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 Security and the date of the proposed 


 


15

















 


payment, and at the same
time the Company shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed 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 15 days
and not less than 10 days prior to the date of the proposed payment and not
less than 10 days after the receipt by the Trustee of the notice of the
proposed payment.  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 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
Security Register, not less than 10 days prior to such Special Record
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
Securities (or their respective Predecessor Securities) are registered at the
close of business on such Special Record Date and shall no longer be payable pursuant
to the following Clause (b).


(b)   The Company may make payment of any Defaulted
Interest in any other lawful manner not inconsistent with the requirements of
any securities exchange or market on which the Securities may be listed, and
upon such notice as may be required by such exchange or market, 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.


Subject to the foregoing provisions of this Section,
each Security delivered under this Indenture upon registration of transfer of
or in exchange for or in lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Security.


In the case of any Security which is converted after
any Regular Record Date on or prior to the close of business on the next
succeeding Interest Payment Date (other than any Security whose Maturity is
prior to such Interest Payment Date), interest whose Stated Maturity is on such
Interest Payment Date shall be payable on such Interest Payment Date
notwithstanding such conversion, and such interest (whether or not punctually
paid or dully provided for) shall be paid to the Person whose name that
Security (or one or more Predecessor Securities) is registered at the close of
business on such Regular Record Date. 
Except as otherwise expressly provided in the immediately preceding
sentence, in the case of any Security which is converted, interest whose Stated
Maturity is after the date of conversion of such Security shall not be payable.


 


16

















 


Section 2.13.  Computation of Interest. 
Interest on the Securities shall be computed on the basis of a 360-day
year of twelve 30-day months.


Section 2.14.  Preservation of Information; Communications
to Holders.


(a)   The Trustee shall preserve, in as current a
form as is reasonably practicable, the names and addresses of Holders contained
in the most recent list furnished to the Trustee as provided in Section 2.05
and the names and addresses of Holders received by the Trustee in its capacity
as Security Registrar.  The Trustee may
destroy any list furnished to it as provided in Section 2.05 upon receipt of a
new list so furnished.


(b)   The rights of Holders to communicate with
other Holders with respect to their rights under this Indenture or under the
Securities, and the corresponding right and duties of the Trustee, shall be as
provided in the TIA.


(c)   Every Holder of Securities, by receiving and
holding the same, 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 the disclosure of information as to names and
addresses of the Holders made pursuant to the TIA.


ARTICLE
3

REDEMPTION


Section 3.01.  Right to Redeem; Notices to Trustee. 
The Company, at its option, may redeem the Securities in accordance
with the provisions of paragraph 5 of the Securities.  If the Company elects to redeem Securities pursuant to paragraph
5 of the Securities, it shall notify the Trustee in writing of the Redemption
Date, the principal amount of Securities to be redeemed, the Redemption Price,
and the amount of accrued interest to, but excluding, the Redemption Date.


The Company shall give the notice to the Trustee
provided for in this Section 3.01 (i) in the case of any redemption of fewer
than all of the Securities, at least 45 days before the Redemption Date and
(ii) in the case of a redemption of all of the Securities, no later than the
Company is required to give notice to the Holders pursuant to Section 3.03, in
each case unless a shorter notice shall be satisfactory to the Trustee.


Section 3.02.  Selection of Securities to be Redeemed. 
If less than all the Securities are to be redeemed, the Trustee shall
select the Securities to be redeemed pro rata or by lot or by a method the
Trustee considers fair and appropriate (as long as such method is not
prohibited by the rules of any stock 


 


17

















 


exchange
or automated quotation system on which the Securities are then listed).  The Trustee shall make the selection at
least 10 days, but not more than 60 days, before the Redemption Date from
outstanding Securities not previously called for redemption.  The Trustee may select for redemption
portions of the principal amount of Securities that have denominations larger
than $1,000.  Securities and portions of
Securities selected by the Trustee shall be in principal amounts of $1,000 or a
multiple of $1,000.  Provisions of this
Indenture that apply to Securities called for redemption also apply to portions
of Securities called for redemption. 
The Trustee shall notify the Company promptly of the Securities or
portions of Securities to be redeemed.


If any Security selected for partial redemption is
converted in part before termination of the conversion right with respect to
the portion of the Security so selected, the converted portion of such Security
shall be deemed (so far as may be) to be the portion selected for
redemption.  Securities which have been
converted during a selection of Securities to be redeemed may be treated by the
Trustee as outstanding for the purpose of such selection.


Section 3.03.  Notice of Redemption. 
At least 30 days but not more than 60 days before a Redemption Date,
the Company shall mail a notice of redemption by first-class mail, postage
prepaid, to each Holder of Securities to be redeemed.


The notice shall identify the Securities to be redeemed
and shall state:


(a)   the Redemption Date;


(b)   the Redemption Price, together with the
amount of accrued interest to, but excluding, the Redemption Date;


(c)   the Conversion Price;


(d)   the name and address of the Paying Agent and
Conversion Agent;


(e)   that Securities called for redemption may be
converted at any time before the close of business on the last Trading Day
prior to the Redemption Date;


(f)    that Holders who want to convert Securities
must satisfy the requirements set forth in paragraph 7 of the Securities;


(g)   that Securities called for redemption must be
surrendered to the Paying Agent to collect the Redemption Price and accrued
interest to, but excluding, the Redemption Date;


 


18

















 


(h)   if fewer than all the outstanding Securities
are to be redeemed, the certificate number and principal amounts of the
particular Securities to be redeemed; and


(i)    that interest on Securities called for
redemption will cease to accrue on and after the Redemption Date.


At the Company’s request, the Trustee shall give the
notice of redemption in the Company’s name and at the Company’s expense.


Section 3.04.  Effect of Notice of Redemption. 
Once notice of redemption is given, Securities called for redemption
become due and payable on the Redemption Date and at the Redemption Price,
together with accrued interest to, but excluding, the Redemption Date, stated
in the notice except for Securities which are converted in accordance with the
terms of this Indenture.


Upon the later of the Redemption Date or the date
such Securities are surrendered to the Paying Agent, such Securities shall be
paid at the Redemption Price, together with accrued interest to, but excluding,
the Redemption Date, stated in the notice.


Section 3.05.  Deposit of Redemption Price. 
Prior to or on the Redemption Date, the Company shall deposit with the
Paying Agent (or if the Company or a Subsidiary or an Affiliate of either of
them is the Paying Agent, shall segregate and hold in trust) money sufficient
to pay the Redemption Price and accrued interest to, but excluding, the
Redemption Date of all Securities to be redeemed on that date other than
Securities or portions of Securities called for redemption which prior thereto
have been delivered by the Company to the Trustee for cancellation or have been
converted; provided that if such payment is made on the Redemption Date it must
be received by the Trustee or Paying Agent, as the case may be, by 10:00
a.m.  New York City time, on such
Redemption Date.  The Paying Agent shall
as promptly as practicable return to the Company any money, with interest, if
any, thereon (subject to the provisions of Section 7.01(f)), not required for
that purpose because of conversion of Securities.  If such money is then held by the Company in trust and is not
required for such purpose it shall be discharged from such trust.


Section 3.06.  Securities Redeemed in Part. 
Upon surrender of a Security that is redeemed in part, the Company
shall execute and the Trustee shall authenticate and deliver to the Holder a
new Security in an authorized denomination equal in principal amount to the
unredeemed portion of the Security surrendered.


Section 3.07.  Conversion Arrangement on Call for
Redemption.  In connection with any
redemption of Securities, the Company may arrange for the 


 


19

















 


purchase
and conversion of any Securities called for redemption by an agreement with one
or more investment bankers or other purchasers to purchase such Securities by
paying to the Paying Agent in trust for the Securityholders, on or before the
close of business on the Redemption Date, an amount that, together with any
amounts deposited with the Paying Agent by the Company for the redemption of
the Securities, is not less than the Redemption Price, together with interest,
if any, accrued to the Redemption Date, of such Securities.  Notwithstanding anything to the contrary
contained in this Article 3, the obligation of the Company to pay the
Redemption Price of such Securities, including all accrued interest, 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, any Securities 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 10) surrendered
by such purchasers for conversion, all immediately prior to the close of
business on the Redemption Date, subject to payment of the above amount as
aforesaid.


The Paying Agent shall hold and pay to the Holders
whose Securities are selected for redemption any such amount paid to it in the
same manner as it would moneys deposited with it by the Company for the
redemption of Securities.  Without the
Paying Agent’s prior written consent, no arrangement between the Company and
such purchasers for the purchase and conversion of any Securities shall
increase or otherwise affect any of the powers, duties, responsibilities or
obligations of the Paying Agent as set forth in this Indenture, and the Company
agrees to indemnify the Paying Agent from, and hold it harmless against, any
loss, liability or expense arising out of or in connection with any such
arrangement for the purchase and conversion of any Securities between the
Company and such purchasers, including the costs and expenses incurred by the
Paying Agent in the defense of any claim or liability arising out of or in
connection with the exercise or performance of any of its powers, duties,
responsibilities or obligations under this Indenture.


Section 3.08.  Redemption at Option of the Holder upon a
Fundamental Change.  (a)  If
a Fundamental Change shall occur at any time prior to July 1, 2009, each Holder
of Securities shall have the right, at such Holder’s option, to require the
Company to redeem such Holder’s Securities on the date (the “Fundamental
Change Repurchase Date”) (or if such date is not a Business Day, the
next succeeding Business Day) that is 45 days after the date of the Company’s
notice of such Fundamental Change.  The
Securities will be redeemable in part in multiples of $1,000 of principal
amount.  Such repayment shall be made at
100% of the principal amount (the “Fundamental Change Redemption Price”)
thereof. In each case, the Company shall also pay to such Holders accrued
interest to, but excluding, the Fundamental Change Repurchase Date on the
redeemed Securities; provided that if such Fundamental Change 


 


20

















 


Repurchase
Date is an Interest Payment Date, then the interest payable on such date shall
be paid to the Holder of the Security on the next preceding the Regular Record
Date.


(b)   On or before the tenth day after the
occurrence of a Fundamental Change, the Company, or, at its written request
(which must be received by the Trustee at least five Business Days prior to the
date the Trustee is requested to give notice as described below), the Trustee
in the name of and at the expense of the Company, shall mail or cause to be
mailed to all Holders of record on the date of the Fundamental Change a notice
(the “Company
Notice”) of the occurrence of such Fundamental Change and of the
redemption right at the option of the Holders arising as a result thereof.  Such notice shall be mailed in the manner
and with the effect set forth in Section 3.03. 
The Company shall also deliver a copy of the Company Notice to the
Trustee at such time as it is mailed to the Holders.


Each Company Notice shall specify the circumstances
constituting the Fundamental Change, the Fundamental Change Repurchase Date,
the Fundamental Change Redemption Price at which the Company shall be obligated
to redeem the Securities, the amount of interest accrued on each Security to,
but excluding, the Fundamental Change Repurchase Date, the latest time by which
the Holder must exercise the redemption right (the “Fundamental Change Expiration Time”),
that the Holder shall have the right to withdraw any Notes prior to the
Fundamental Change Expiration Time, a description of the procedure which a
Holder must follow to exercise such redemption right and to withdraw any
surrendered Notes and the place or places where the Holder is to surrender such
Holder’s Securities.


No failure of the Company to give the foregoing
notices and no defect therein shall limit the Holders’ redemption rights or
affect the validity of the proceedings for the repurchase of the Securities
pursuant to this Section 3.08.


(c)   For a Security to be so redeemed at the
option of the Holder, the Paying Agent must receive such Security with the form
entitled “Option to Elect Redemption Upon a Fundamental Change” on the reverse
thereof duly completed (a “Fundamental Change Redemption Notice”),
together with such Security duly endorsed for transfer, on or before the 30th
day after the date of such Company Notice (or if such 30th day is not a
Business Day, the immediately preceding Business Day).  All questions as to the validity,
eligibility (including time of receipt) and acceptance of any Security for
redemption shall be determined by the Company, whose determination shall be
final and binding.


(d)   Upon receipt by the Company of the
Fundamental Change Redemption Notice specified in Section 3.08(c), the Holder
of the Security in respect of which such Fundamental Change Redemption Notice
was given shall (unless such Fundamental Change Redemption Notice is withdrawn
as specified 


 


21

















 


in the following two
paragraphs) thereafter be entitled to receive solely the Fundamental Change
Redemption Price, together with accrued interest to, but excluding, the
Fundamental Change Repurchase Date, with respect to such Security.  Such Fundamental Change Redemption Price
together with accrued interest to, but excluding, the Fundamental Change
Repurchase Date, shall be paid to such Holder promptly following the
Fundamental Change Repurchase Date. 
Securities in respect of which a Fundamental Change Redemption Notice
has been given by the Holder thereof may not be converted into shares of Common
Stock on or after the date of the delivery of such Fundamental Change
Redemption Notice, unless such Fundamental Change Redemption Notice has first
been validly withdrawn as specified in the following two paragraphs.


A Fundamental Change Redemption Notice may be
withdrawn by the Holder by means of a written notice of withdrawal delivered to
the office of the Paying Agent at any time prior to the close of business on
the Fundamental Change Repurchase Date to which it relates specifying:


(i)    the certificate number of
the Security in respect of which such notice of withdrawal is being submitted,


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


(iii)  the principal amount, if
any, of such Security which remains subject to the original Fundamental Change
Redemption Notice and which has been or will be delivered for purchase by the
Company.


There shall be no redemption pursuant to Section
3.08 if there has occurred prior to, on or after, as the case may be, the
giving, by the Holders of such Securities, of the required Fundamental Change
Redemption Notice and is continuing an Event of Default (other than a default
in the payment of the Fundamental Change Redemption Price, together with
accrued interest to, but excluding, the Fundamental Change Repurchase Date,
with respect to such Securities).


(e)   On or before the Fundamental Change
Repurchase Date the Company shall deposit with the Trustee or with the Paying
Agent (or, if the Company or a Subsidiary or an Affiliate of either of them is
acting as the Paying Agent, shall segregate and hold in trust as provided in
Section 2.04) an amount of money and/or securities, if permitted hereunder,
sufficient to pay the aggregate Fundamental Change Redemption Price, together
with accrued interest to, but excluding, the Fundamental Change Repurchase
Date, of all the Securities or portions thereof which are to be redeemed as of
such Fundamental Change Repurchase Date; provided that if such payment is made
on the Fundamental Change Repurchase Date it must be received by the Trustee or
Paying Agent, as 


 


22

















 


the case may be, by 10:00
a.m.  New York City time, on such
Fundamental Change Repurchase Date.


(f)    Any Security that is to be redeemed upon a
Fundamental Change only in part shall be surrendered at the office of the
Paying Agent (with, if the Company or the Trustee so requires, due endorsement
by, or a written instrument of transfer in form satisfactory to the Company and
the Trustee duly executed by, the Holder thereof or such Holder’s attorney duly
authorized in writing) and the Company shall execute and, upon the Company’s
written direction to the Trustee, the Trustee shall authenticate and deliver to
the Holder of such Security, without service charge, a new Security or
Securities, of any authorized denomination as requested by such Holder in
aggregate principal amount equal to, and in exchange for, the portion of the
principal amount of the Security so surrendered which is not redeemed.


(g)   In connection with any offer to redeem
Securities under Section 3.08 hereof the Company shall comply with all Federal
and state securities laws so as to permit the rights and obligations under
Section 3.08 to be exercised in the time and in the manner specified in Section
3.08.


(h)   The Trustee and the Paying Agent shall return
to the Company any cash that remains unclaimed as provided in paragraph 11 of
the Securities, together with interest or dividends, if any (subject to the
provisions of Section 7.01(f)), thereon, held by them for the payment of a
Fundamental Change Redemption Price, together with accrued interest to, but
excluding, the Fundamental Change Repurchase Date; provided, however that to
the extent that the aggregate amount of cash deposited by the Company pursuant
to Section 3.08 exceeds the aggregate Fundamental Change Redemption Price,
together with accrued interest to, but excluding, the Fundamental Change
Repurchase Date, of the Securities or portions thereof which the Company is
obligated to purchase as of the Fundamental Change Repurchase Date then
promptly after the Business Day following the Fundamental Change Repurchase
Date the Trustee and the Paying Agent shall return any such excess to the
Company together with interest or dividends, if any, thereon.


ARTICLE
4

COVENANTS


Section 4.01.  Payment of Securities. 
The Company shall promptly make all payments in respect of the
Securities on the dates and in the manner provided in the Securities or
pursuant to this Indenture.  The
principal amount, premium, if any, accrued interest, Redemption Price and
Fundamental Change Redemption Price shall be considered paid on the applicable
date due if on such date the Trustee or the Paying Agent holds on or before
10:00 a.m.  New York City time 


 


23

















 


on such date, in accordance
with this Indenture, money or securities, if permitted hereunder, sufficient to
pay all such amount then due.


The Company shall pay interest at the rate set forth
in paragraph 1 of the Securities and it shall pay interest on overdue interest
at the same rate compounded semiannually (to the extent that the payment of
such interest shall be legally enforceable), which interest on overdue interest
shall accrue from the date such amounts became overdue.


Section 4.02.  SEC Reports. 
The Company shall file with the Trustee, within 15 days after it files
such annual and quarterly reports, information, documents and other reports
with the SEC, copies of its annual report and of the information, documents and
other reports (or copies of such portions of any of the foregoing as the SEC
may by rules and regulations prescribe) which the Company is required to file
with the SEC pursuant to Section 13 or 15(d) of the Exchange Act.


Section 4.03.  Compliance Certificate. 
The Company shall deliver to the Trustee within 120 days after the end
of each fiscal year of the Company (beginning with the fiscal year ending in
June 2004) an Officers’ Certificate stating whether or not the signers know of
any Default that occurred during such period. 
If they do, such Officers’ Certificate shall describe the Default and
its status.


Section 4.04.  Further Instruments and Acts. 
Upon request of the Trustee, the Company will execute and deliver such
further instruments and do such further acts as may be reasonably necessary or
proper to carry out more effectively the purposes of this Indenture.


Section 4.05.  Maintenance of Office or Agency. 
The Company will maintain in the Borough of Manhattan, The City of New
York, an office or agency where Securities may be presented or surrendered for
payment, where Securities may be surrendered for registration of transfer,
exchange, redemption or conversion and where notices and demands to or upon the
Company in respect of the Securities and this Indenture may be served.  The office of U.S. Bank Trust National
Association, an Affiliate of the Trustee, at 100 Wall Street, Suite 1600, New
York, NY 10005, shall be such office or agency for all of the aforesaid
purposes unless the Company shall maintain some other office or agency for such
purposes and shall give prompt written notice to the Trustee of the location,
and any change in the location, of such other office or agency.  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 address of the Trustee set forth in
Section 11.02.


 


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The Company may also from time to time designate one
or more other offices or agencies where the Securities may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission shall
in any manner relieve the Company of its obligation to maintain an office or
agency in the Borough of Manhattan, The City of New York, for such purposes.


Section 4.06.  Restriction on Additional Indebtedness. 
The Company shall not, nor shall it permit any Subsidiary to, directly
or indirectly (including by means of a merger or an acquisition involving a
company with outstanding indebtedness), create, incur, assume, guaranty or
otherwise become directly or indirectly liable for (“Incur”) any additional
indebtedness for borrowed money (other than additional indebtedness that is (i)
in an aggregate principal amount no greater than $35,000,000, (ii) is
subordinate in right of payment to all amounts payable under the Securities and
New Convertible Notes, (iii) does not have a final Stated Maturity prior to the
Stated Maturity of the Securities and the New Convertible Notes, and (iv) has
an Average Life at least equal to the remaining Average Life of the Securities
and the New Convertible Notes) or issue any Disqualified Stock, except that the
Company may, and may permit any Subsidiary to Incur additional indebtedness


(a)   pursuant to any interest rate swap agreement,
interest rate cap agreement or other agreement designed to protect against
fluctuations in interest rates, any foreign exchange forward contract, currency
swap agreement or other agreement designed to protect against fluctuations in
foreign exchange rates, or any commodity or raw material futures contract or
any other agreement designed to protect against fluctuations in raw material
prices, entered into in the ordinary course of business for the purpose of
limiting risks associated with our business and not for speculation;


(b)   with respect to letters of credit and
bankers’ acceptances issued in the ordinary course of business and not
supporting indebtedness for borrowed money, including letters of credit
supporting performance, surety or appeal bonds, indemnification obligations,
lease or other contractual deposits, or other similar obligations;


(c)   the proceeds of which, less fees and
expenses, are used to repay, redeem or repurchase, at the option of the
Company, Securities, New Notes, or Old Notes, provided that if any Securities
or New Convertible Notes will remain outstanding, the Stated Maturity of the
indebtedness incurred must be at least 120 days after the Stated Maturity of
the Securities and New Convertible Notes;


(d)   indebtedness incurred to refinance, renew or
replace the SGI Japan Secured Debt, or any extensions or amendments of the SGI
Japan Secured Debt, in each case that do not increase the principal amount
thereof; or


(e)   other indebtedness to banks or other
institutional lenders in the form of revolving credit loans or term loans or
the issuance of letters of credit or bankers’ acceptances or the like,
including the Secured Credit Facility as it may be extended, refinanced,
renewed 


 


25

















 


or replaced, provided that
the aggregate principal amount of such other indebtedness at any time
outstanding does not exceed $100 million.


Section 4.07.  Restricted Payments. 
The Company shall not


(a)   declare or pay any dividend or make any
distribution on its Capital Stock, other than dividends or distributions paid
in its or its Subsidiaries’ Capital Stock other than Disqualified Stock;


(b)   purchase, redeem or otherwise acquire or
retire for value any of its Capital Stock or Options, other than (1) the
repurchase of unvested restricted stock in connection with voluntary or
involuntary terminations of employment with an aggregate purchase price less
than $100,000 per fiscal year, or (2) repurchases, redemptions, acquisitions or
retirements paid for with its Capital Stock other than Disqualified Stock or
Options to buy Capital Stock other than Disqualified Stock;


(c)   pay any funds to or for the account of, make
any investment in, lease, sell, transfer or otherwise dispose of any assets,
tangible or intangible, to, or participate in, or effect, any transaction with,
any Affiliate except on an arms-length basis on terms at least as favorable to
the Company as could have been obtained from a third party that was not an
Affiliate (except that the Company may enter into compensatory arrangements
with and pay such salary, bonus or other compensation to employees, officers
and directors as have been approved by a committee of the Company's Board of
Directors comprised of independent directors); or


(d)   repay, redeem, repurchase, defease or
otherwise acquire or retire for value, any indebtedness subordinated in right
of payment to the Securities or the New Convertible Notes except a payment of
interest or principal when due.


 


ARTICLE
5

SUCCESSOR CORPORATION


Section 5.01.  When Company May Merge or Transfer Assets. 
Company shall not consolidate with or merge with or into any other
Person (other than in a merger or consolidation in which the Company is the
surviving Person) or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, unless:


(a)   the Person (if other than the Company) formed
by such consolidation or into which the Company is merged or the Person which
acquires by conveyance, transfer or lease the properties and assets of the
Company substantially as an entirety (i) shall be a corporation, partnership or
trust organized and validly existing under the laws of the United States or any
State thereof or the District of Columbia and (ii) shall expressly assume, by
an indenture supplemental hereto, executed and delivered to the Trustee, in
form satisfactory to the Trustee, all of the obligations of the Company under
the Securities and this Indenture;


(b)   immediately after giving effect to such
transaction, no Default shall have occurred and be continuing; and


(c)   the Company shall have delivered to the
Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that
such consolidation, 


 


26

















 


merger, conveyance, transfer
or lease and, if a supplemental indenture is required in connection with such
transaction, such supplemental indenture, comply with this Article and that all
conditions precedent herein provided for relating to such transaction have been
satisfied.


The successor Person formed by such consolidation or
into which the Company is merged or the successor Person to which such
conveyance, transfer or lease is made shall succeed to, and be substituted for,
and may exercise every right and power of, the Company under this Indenture
with the same effect as if such successor had been named as the Company herein;
and thereafter, except in the case of (i) a lease of its properties and assets
substantially as an entirety and (ii) obligations the Company may have under a
supplemental indenture pursuant to Section 10.14, the Company shall be
discharged from all obligations and covenants under this Indenture and the
Securities.


ARTICLE
6

DEFAULTS AND REMEDIES


Section 6.01.  Events of Default. 
“Event
of Default” occurs if:


(a)   the Company defaults in the payment of the
principal amount of, premium, if any, Redemption Price or Fundamental Change
Redemption Price on any Security when the same becomes due and payable at its
Stated Maturity, upon redemption, upon declaration or otherwise;


(b)   the Company defaults in the payment of any
installment of interest upon any of the Securities as and when the same shall
become due and payable, and continuance of such default for 30 days;


(c)   the Company fails to comply with any of its
agreements in the Securities or this Indenture (other than those referred to in
clause (1) or (2) above) and such failure continues for 60 days after receipt
by the Company of a Notice of Default;


(d)   a decree or order by a court having
jurisdiction in the premises shall have been entered adjudging the Company a
bankrupt or insolvent, or approving as properly filed a petition seeking
reorganization of the Company under any Bankruptcy Law, and such decree or
order shall have continued undischarged and unstayed for a period of 60
consecutive days; or a decree or order of a court having jurisdiction in the
premises of the appointment of a receiver or liquidator or trustee or assignee
in bankruptcy or insolvency of the Company or of its property, or for the
winding-up or liquidation of its affairs, shall have been entered, and such
decree or order shall have remained in force undischarged and unstayed of a
period of 60 consecutive days; or


 


27

















 


(e)   the Company shall institute proceedings to be
adjudicated a voluntary bankrupt, or shall consent to the filing of a
bankruptcy proceeding against it, or shall file a petition or answer or consent
seeking reorganization under any Bankruptcy Law, or shall consent to the filing
of any such petition, or shall consent to the appointment of a receiver or
liquidator or trustee or assignee in bankruptcy or insolvency of it or of its
property or shall make an assignment for the benefit of creditors, or shall
admit in writing its inability to pay its debts generally as they become due.


(f)    an event of default under the Secured Credit
Facility, the Old Notes Indenture or the New Convertible Indenture shall have
occurred which results in the principal amount and accrued interest on that
debt becoming immediately due and payable.


“Bankruptcy Law” means Title 11, United
States Code, or any similar Federal or state law for the relief of debtors.


A Default under (c) above is not an Event of Default
until the Trustee notifies the Company, or the Holders of at least 25% in
aggregate principal amount of the Securities at the time outstanding notify the
Company and the Trustee, of the Default and the Company does not cure such
Default (and such Default is not waived) within the time specified in clause
(3) above after actual receipt of such notice (a “Notice of Default”).  Any such notice must specify the Default,
demand that it be remedied and state that such notice is a Notice of Default.


Section 6.02.  Acceleration. 
If an Event of Default (other than an Event of Default specified in
Section 6.01(d) or (e)) occurs and is continuing, the Trustee by notice to the
Company, or the Holders of at least 25% in aggregate principal amount of the
Securities at the time outstanding by notice to the Company and the Trustee,
may declare the principal amount and premium, if any, on all the Securities and
the interest accrued thereon to be immediately due and payable.  Upon such a declaration, such principal
amount, premium, if any, and interest accrued thereon shall be due and payable
immediately.  If an Event of Default
specified in Section 6.01(d) or (e) occurs and is continuing, the principal
amount and premium, if any, on all the Securities and the interest accrued
thereon shall become and be immediately due and payable without any declaration
or other act on the part of the Trustee or any Securityholders.  The Holders of a majority in aggregate
principal amount of the Securities at the time outstanding, by notice to the
Trustee (and without notice to any other Securityholder) may rescind an
acceleration and its consequences if the rescission would not conflict with any
judgment or decree and if all existing Events of Default have been cured or
waived except nonpayment of the principal amount, premium, if any, and interest
accrued thereon that has become due solely as a result of acceleration and if
all amounts due to the Trustee under Section 7.07 have been paid.  No such 


 


28

















 


rescission
shall affect any subsequent Default or impair any right consequent thereto.


Section 6.03.  Other Remedies. 
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of the principal amount and
premium, if any, on the Securities and interest accrued thereon or to enforce
the performance of any provision of the Securities or this Indenture.


The Trustee may maintain a proceeding even if the Trustee
does not possess any of the Securities or does not produce any of the
Securities in the proceeding.  A delay
or omission by the Trustee or any Securityholder in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of, or acquiescence in, the Event of Default.  No remedy is exclusive of any other
remedy.  All available remedies are
cumulative.


Section 6.04.  Waiver of Past Defaults. 
The Holders of a majority in aggregate principal amount of the
Securities at the time outstanding, by notice to the Trustee (and without
notice to any other Securityholder), may waive an existing Default and its
consequences except (1) an Event of Default described in Section 6.01(a) or
6.01(b), (2) a Default in respect of a provision that under Section 9.02 cannot
be amended without the consent of each Securityholder affected, or (3) a
Default that constitutes a failure to convert any Security in accordance with
the terms of Article 10.  When a Default
is waived, it is deemed cured, but no such waiver shall extend to any
subsequent or other Default or impair any consequent right.


Section 6.05.  Control by Majority. 
The Holders of a majority in aggregate principal amount of the
Securities at the time outstanding may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or of
exercising any trust or power conferred on the Trustee.  However, the Trustee may refuse to follow
any direction that conflicts with law or this Indenture or that the Trustee
determines in good faith is unduly prejudicial to the rights of other
Securityholders or would involve the Trustee in personal liability unless the
Trustee is offered indemnity satisfactory to it.


Section 6.06.  Limitation on Suits. 
A Securityholder may not pursue any remedy with respect to this
Indenture or the Securities unless:


(a)   the Holder gives to the Trustee written
notice stating that an Event of Default is continuing;


 


29

















 


(b)   the Holders of at least 25% in aggregate
principal amount of the Securities at the time outstanding make a written
request to the Trustee to pursue the remedy;


(c)   such Holder or Holders offer to the Trustee
reasonable security or indemnity against any loss, liability or expense
satisfactory to the Trustee;


(d)   the Trustee does not comply with the request
within 60 days after receipt of the notice, the request and the offer of
security or indemnity; and


(e)   the Holders of a majority in aggregate
principal amount of the Securities at the time outstanding do not give the
Trustee a direction inconsistent with the request during such 60-day period.


A Securityholder may not use this Indenture to
prejudice the rights of any other Securityholder or to obtain a preference or
priority over any other Securityholder.


Section 6.07.  Rights of Holders to Receive Payment. 
Notwithstanding any other provision of this Indenture, the right of any
Holder to receive payment of the principal amount, premium, if any, accrued
interest, Redemption Price or Fundamental Change Redemption Price in respect of
the Securities held by such Holder, on or after the respective due dates
expressed in the Securities or any Redemption Date or Fundamental Change
Repurchase Date, as the case may be, and to convert the Securities in
accordance with Article 10, or to bring suit for the enforcement of any such
payment on or after such respective dates or the right to convert, shall, not
be impaired or affected adversely without the consent of each such Holder.


Section 6.08.  Collection Suit by Trustee. 
If an Event of Default described in Section 6.01(a) or Section 6.01(b)
occurs and is continuing, the Trustee may recover judgment in its own name and
as trustee of an express trust against the Company for the whole amount owing
with respect to the Securities and the amounts provided for in Section 7.07.


Section 6.09.  Trustee May File Proofs of Claim. 
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal amount, premium,
if any, accrued interest, Redemption Price or Fundamental Change Redemption
Price in respect of the Securities 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 on the Company 


 


30

















 


for
the payment of any such amount) shall be entitled and empowered, by
intervention in such proceeding or otherwise,


(a)   to file and prove a claim for the whole
amount of the principal amount, premium, if any, accrued interest, Redemption
Price or Fundamental Change Redemption Price and to file such other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and of the
Holders allowed in such judicial proceeding, and


(b)   to collect and receive any moneys or other
property payable or deliverable on any such claims and to distribute the same;


and any custodian, receiver,
assignee, trustee, liquidator, sequestrator or similar official in any such
judicial proceeding is hereby authorized by each Holder 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 Holders, to pay the Trustee any amount due it
for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07.


Nothing herein contained shall be deemed to
authorize the Trustee to authorize or consent to or accept or adopt on behalf
of any Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Securities or the rights of any Holder thereof, or to authorize
the Trustee to vote in respect of the claims of any Holder in any such
proceeding.


Section 6.10.  Priorities. 
If the Trustee collects any money pursuant to this Article 6, it shall
pay out the money in the following order:


First:  to the Trustee for amounts due under Section 7.07;


Second:  to Securityholders for amounts due and unpaid on the Securities
for the principal amount, premium, if any, accrued interest, Redemption Price
or Fundamental Change Redemption Price, as the case may be, ratably, without
preference or priority of any kind, according to such amounts due and payable
on the Securities; and


Third:  the balance, if any, to the Company.


The Trustee may fix a record date and payment date
for any payment to Securityholders pursuant to this Section 6.10.  At least 15 days before such record date,
the Company shall mail to each Securityholder and the Trustee a notice that
states the record date, the payment date and amount to be paid.


 


31



















 


Section 6.11.  Undertaking for Costs. 
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, a court in its discretion may require the filing by any party
litigant (other than the Trustee) in the suit of an undertaking to pay the
costs of the suit, and the court in its discretion may assess reasonable costs,
including reasonable attorneys’ fees, against any party litigant in the suit,
having due regard to the merits and good faith of the claims or defenses made
by the party litigant.  This Section
6.11 does not apply to a suit by the Trustee, a suit by a Holder pursuant to
Section 6.07 or a suit by Holders of more than 10% in aggregate principal amount
of the Securities at the time outstanding.


Section 6.12.  Waiver of Stay, Extension or Usury Laws. 
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay or extension law or any
usury or other law wherever enacted, now or at any time hereafter in force,
which would prohibit or forgive the Company from paying all or any portion of
the principal amount, premium, if any, accrued interest, Redemption Price or
Fundamental Change Redemption Price in respect of Securities as contemplated
herein, or which may affect the covenants or the performance of this Indenture;
and the Company (to the extent that it may lawfully do so) hereby expressly
waives all benefit or advantage of any such laws and covenants that it will not
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.


ARTICLE
7

TRUSTEE


Section 7.01.  Duties of Trustee. 
(a) If an Event of
Default has occurred and is continuing, the Trustee shall exercise the rights
and powers vested in it by this Indenture and use the same degree of care and
skill in its exercise as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs.


(b)   Except during the continuance of an Event of
Default:


(i)    the Trustee need perform
only those duties that are specifically set forth in this Indenture and no
others; and


(ii)   in the absence of bad faith
on its part, the Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and conforming to the
requirements of this Indenture. However, the Trustee shall examine the
certificates and opinions to 


 


32

















 




determine whether or not they conform to the requirements of this Indenture.


(c)   The Trustee may not be relieved from
liability for its own negligent action, its own negligent failure to act or its
own willful misconduct, except that:


(i)    this paragraph (c) does not
limit the effect of paragraph (b) of this Section 7.01;


(ii)   the Trustee shall not be
liable for any error of judgment made in good faith by a Trust Officer unless
it is proved that the Trustee was negligent in ascertaining the pertinent
facts; and


(iii)  the Trustee shall not be
liable with respect to any action it takes or omits to take in good faith in
accordance with a direction received by it pursuant to Section 6.05.


(d)   Every provision of this Indenture that in any
way relates to the Trustee is subject to paragraphs (a), (b), (c) and (e) of
this Section 7.01.


(e)   The Trustee may refuse to perform any duty or
exercise any right or power or extend or risk its own funds or otherwise incur
any financial liability unless it receives indemnity satisfactory to it against
any loss, liability or expense.


(f)    Money held by the Trustee in trust hereunder
need not be segregated from other funds except to the extent required by law.


Section 7.02.  Rights of Trustee. 
(a) The Trustee may rely on any document believed by it to be genuine
and to have been signed or presented by the proper person.  The Trustee need not investigate any fact or
matter stated in the document.


(b)   Before the Trustee acts or refrains from
acting, it may require a Company Order, an Officers’ Certificate or an Opinion
of Counsel.  The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Company Order, Officers’ Certificate or Opinion of Counsel.


(c)   The Trustee may act through agents and shall
not be responsible for the misconduct or negligence of any agent appointed with
due care.


(d)   Subject to the provisions of Section 7.01(c),
the Trustee shall not be liable for any action it takes or omits to take in
good faith which it believes to be authorized or within its rights or powers.


Section 7.03.  Individual Rights of Trustee. 
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may 


 


33

















 


otherwise
deal with the Company or its Affiliates with the same rights it would have if
it were not Trustee.  Any Paying Agent,
Registrar, Conversion Agent or co-registrar may do the same with the like
rights.  However, the Trustee must
comply with Section 7.10.


Section 7.04.  Trustee’s Disclaimer. 
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the Company’s
use of the proceeds from the Securities, it shall not be responsible for any
statement in the Prospectus for the Securities or in the Indenture of the
Securities (other than its certificate of authentication), the acts of an prior
Trustee hereunder, or the determination as to which beneficial owners are
entitled to receive any notices hereunder.


Section 7.05.  Notice of Defaults. 
If a Default occurs and is continuing and if it is known to the
Trustee, the Trustee shall give to each Securityholder notice of the Default
within 90 days after it occurs.  Except
in the case of a Default described in Section 6.01(a) or Section 6.01(b), the Trustee
may withhold the notice if and so long as a committee of its Trust Officers in
good faith determines that withholding the notice is in the interests of
Securityholders.  The Trustee shall not
give notice of a Default pursuant to Section 6.01(c) until at least sixty (60)
days have passed since its occurrence.


Section 7.06.  Disqualification; Conflicting Interests. 
If the Trustee has or shall acquire any conflicting interest within the
meaning of the TIA, it shall either eliminate such conflicting interest or
resign, to the extent and in the. 
manner provided by, and subject to the provisions of the TIA and this
Indenture.


Section 7.07.  Compensation and Indemnity. 
The Company agrees:


(a)   to pay to the Trustee from time to time
reasonable compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust);


(b)   to reimburse the Trustee upon its request for
all reasonable expenses, disbursements and advances incurred or made by the
Trustee in accordance with any provision of this Indenture (including the
reasonable compensation and the expense, advances and disbursements of its
agents and counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or bad faith; and


(c)   to indemnify the Trustee for, and to hold it
harmless against, any loss, liability or expense incurred without negligence or
bad faith on its part, arising out of or in connection with the acceptance or
administration of this trust, including the costs and expenses of defending
itself against any claim or liability 


 


34

















 


in connection with the
exercise or performance of any of its powers or duties hereunder.


To secure the Company’s payment obligations in this
Section 7.07, the Trustee shall have a lien prior to the Securities on all
money or property held or collected by the Trustee, except that held in trust
to pay the principal amount, premium, if any, accrued interest, Redemption
Price or Fundamental Change Redemption Price, as the case may be, on particular
Securities.


The Company’s payment obligations pursuant to this
Section 7.07 shall survive the discharge of this Indenture.  When the Trustee incurs expenses after the
occurrence of a Default specified in Section 6.01(d) or (e), the expenses are
intended to constitute expenses of administration under any Bankruptcy Law.


Section 7.08.  Replacement of Trustee. 
The Trustee may resign by so notifying the Company; provided, however,
no such resignation shall be effective until a successor Trustee has accepted
its appointment pursuant to this Section 7.08. 
The Holders of a majority in aggregate principal amount of the
Securities at the time outstanding may remove the Trustee by so notifying the
Trustee and may appoint a successor Trustee. 
The Company shall remove the Trustee if:


(a)   the Trustee fails to comply with, or ceases
to be eligible under, Section 7.10;


(b)   the Trustee is adjudged bankrupt or
insolvent;


(c)   a receiver or public officer takes charge of
the Trustee or its property; or


(d)   the Trustee otherwise becomes incapable of
acting.


If the Trustee resigns or is removed or if a vacancy
exists in the office of Trustee for any reason, the Company shall promptly
appoint, by resolution of its Board of Directors, a successor Trustee.


A successor Trustee shall deliver a written
acceptance of its appointment to the retiring Trustee and to the Company.  Thereupon the resignation or removal of the
retiring Trustee shall become effective, and the successor Trustee shall have
all the rights, powers and duties of the Trustee under this Indenture.  The successor Trustee shall mail a notice of
its succession to Securityholders.  The
retiring Trustee shall promptly transfer all property held by it as Trustee to
the successor Trustee, subject to the lien provided for in Section 7.07.


If a successor Trustee does not take office within
30 days after the retiring Trustee resigns or is removed, the retiring Trustee,
the Company or the Holders of a majority in aggregate principal amount of the
Securities at the time outstanding 


 


35

















 


may petition any court of
competent jurisdiction for the appointment of a successor Trustee.


If the Trustee fails to comply with Section 7.10,
any Securityholder may petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.


Section 7.09.  Successor Trustee by Merger. 
If the Trustee consolidates with, merges or converts into, or transfers
all or substantially all its corporate trustee business or assets (including
the administration of the trust created by this Indenture) to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall be the successor Trustee.


Section 7.10.  Eligibility; Disqualification. 
The Trustee (or if a Trustee is a member of a bank holding company, its
bank holding company) shall have a combined capital and surplus of at least
$50,000,000 as set forth in its most recent published annual report of
conditions.  If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section,
it shall resign immediately in the manner and with the effect hereinafter
specified in this Article.


Section 7.11.  Preferential Collection of Claims Against
Company.  If and when the Trustee
shall be or become a creditor of the Company (or any other obligor upon the
Securities), the Trustee shall be subject to the provisions of the TIA
regarding the collection of claims against the Company (or any such other
obligor).


Section 7.12.  Reports by Trustee.


(a)   The Trustee shall transmit to Holders such
reports concerning the Trustee and its actions under this Indenture as may be
required pursuant to the TIA at the times and in the manner provided pursuant
thereto.


(b)   A copy of each such report shall, at the time
of such transmission to Holders, be filed by the Trustee with each stock
exchange or market upon which the Securities are listed, with the Commission
and with the Company.  The Company will
notify the Trustee when the Securities are listed on any stock exchange or
market.


ARTICLE
8

DISCHARGE OF INDENTURE


Section 8.01.  Discharge of Liability on Securities. 
When (i) the Company delivers to the Trustee all outstanding Securities
(other than Securities replaced pursuant to Section 2.07) for cancellation or
(ii) all outstanding Securities have become due and payable and the Company
deposits with the Trustee cash and/or 


 


36

















 


securities,
as permitted by the terms hereof, sufficient to pay at Stated Maturity the
principal amount of all outstanding Securities (other than Securities replaced
pursuant to Section 2.07), and if in either case the Company pays all other
sums payable hereunder by the Company, then this Indenture shall, subject to
Section 7.07, cease to be of further effect. 
The Trustee shall join in the execution of a document prepared by the
Company acknowledging satisfaction and discharge of this Indenture on demand of
the Company accompanied by an Officers’ Certificate and Opinion of Counsel and
at the cost and expense of the Company.


Section 8.02.  Repayment to the Company. 
The Trustee and the Paying Agent shall return to the Company upon
written request any money or securities held by them for the payment of any
amount with respect to the Securities that remains unclaimed for two years,
provided, however, that the Trustee or such Paying Agent, before being required
to make any such return, shall at the expense of the Company cause to be
published once in a newspaper of general circulation in The City of New York or
mail to each such Holder notice that such money or securities remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such publication or mailing, any unclaimed money or securities
then remaining will be returned to the Company.  After return to the Company, Holders entitled to the money or
securities must look to the Company for payment as general creditors unless an
applicable abandoned property law designates another person.


ARTICLE
9

AMENDMENTS


Section 9.01.  Without Consent Of Holders. 
The Company and the Trustee may amend this Indenture or the Securities
without the consent of any Securityholder:


(a)   to cure any ambiguity, defect or
inconsistency;


(b)   to comply with Article 5 or Section 10.14;


(c)   to provide for uncertificated Securities in
addition to certificated Securities so long as such uncertificated Securities
are in registered form for purposes of the Internal Revenue Code of 1986, as
amended;


(d)   to make any change that does not adversely
affect the right of any Securityholder; or


(e)   to make any change to comply with the TIA, or
any amendment thereto, or to comply with any requirement of the SEC in
connection with the qualification, if any, of the Indenture under the TIA.


 


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Section 9.02.  With Consent of Holders.  With the written consent of the Holders of at least
a majority in aggregate principal amount of the Securities at the time
outstanding, the Company and the Trustee may amend this Indenture or the
Securities.  However, without the
consent of each Securityholder affected, an amendment or supplement to this
Indenture or the Securities may not:


(a)   make any change to the manner or rate of
accrual in connection with interest, reduce the rate of interest referred to in
paragraph 1 of the Securities or extend the time for payment of interest on any
Security;


(b)   reduce the Redemption Price or extend the
Stated Maturity;


(c)   reduce the Redemption Price or Fundamental
Change Redemption -Price of any Security;


(d)   make any Security payable in money or
securities other than that stated in the Security;


(e)   make any change in Section 6.04, Section 6.07
or this Section 9.02, except to increase any such percentage;


(f)    make any change that adversely affects the
right to convert any Security; or


(g)   make any change that adversely affects the
right to require the Company to redeem the Securities upon a Fundamental Change
in accordance with the terms thereof and this Indenture;


and no such amendment or
supplement to this Indenture may reduce the aforesaid percentage of Securities
whose Holders must consent to any such amendment or supplemental indenture,
without the consent of the Holders of all the Securities then outstanding.


It shall not be necessary for the consent of the
Holders under this Section 9.02 to approve the particular form of any proposed
amendment or supplemental indenture, but it shall be sufficient if such consent
approves the substance thereof.


After an amendment under this Section 9.02 becomes
effective, the Company shall mail to each Holder a notice briefly describing
the amendment.


Section 9.03.  Compliance with TIA. 
Every supplemental indenture executed pursuant to this Article shall
comply with the TIA as then in effect.


Section 9.04.  Revocation and Effect of Consents, Waivers
and Actions.  Until an amendment,
supplemental indenture, waiver or other action becomes effective, a consent to
it or any other action by a Holder of a Security hereunder is 


 


38

















 


a
continuing consent by the Holder and every subsequent Holder of that Security
or portion of the Security that evidences the same obligation as the consenting
Holder’s Security, even if notation of the consent, waiver or action is not
made on the Security.  However, any such
Holder or subsequent Holder may revoke the consent, waiver or action as to such
Holder’s Security or portion of the Security if the Trustee receives the notice
or revocation before the date the amendment, supplemental indenture, waiver or
action becomes effective.  After an
amendment, supplemental indenture, waiver or action becomes effective, it shall
bind every Securityholder.


Section 9.05.  Notation on or Exchange of Securities. 
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. 
If the Company shall so determine, new Securities so modified as to
conform, in the opinion of the Trustee and the Board of Directors, to any such
supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for outstanding
Securities,


Section 9.06.  Trustee to Sign Supplemental Indentures. 
The Trustee shall sign any supplemental indenture authorized pursuant
to this Article 9 if the amendment does not adversely affect the rights,
duties, liabilities or immunities of the Trustee.  If it does, the Trustee may, but need not, sign such supplemental
indenture.  In signing such supplemental
indenture the Trustee shall be entitled to receive, and (subject to the
provisions of Section 7.01) shall be fully protected in relying upon, an
Officers’ Certificate and an Opinion of Counsel stating that such supplemental
indenture is authorized or permitted by this Indenture.


Section 9.07.  Effect of Supplemental Indentures. 
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every
Holder of Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.


ARTICLE
10

CONVERSION


Section 10.01.  Conversion Privilege. 
A Holder of a Security may convert such Security into Common Stock at
any time during the period stated in paragraph 7 of the Securities.  The conversion price per share of Common
Stock (the “Conversion Price”) shall be that set forth in paragraph 7 in
the Securities, subject to adjustment as herein set forth.


 


39

















 


A Holder may convert a portion of the principal
amount of a Security if the portion is $1,000 or a multiple of $1,000.  Provisions of this Indenture that apply to
conversion of all of a Security also apply to conversion of a portion of a
Security.


Section 10.02.  Conversion Procedure. 
To convert a Security a Holder must satisfy the requirements in
paragraph 7 of the Securities.  The date
on which the Holder satisfies all those requirements is the conversion date
(the “Conversion
Date”).  Securities
surrendered for conversion during the period from the close of business on any
Regular Record Date to the close of business on the Trading Day immediately
prior to the next succeeding Interest Payment Date (the “Interest Period”) shall
(except in the case of Securities or portions thereof which have been called
for redemption on a Redemption Date within such Interest Period) be accompanied
by payment in New York Clearing House funds or other funds acceptable to the
Company of an amount equal to the interest payable on such Interest Payment
Date on the principal amount of Securities being surrendered for conversion.  Subject to the provisions of Section 3.07
relating to the payment of Defaulted Interest by the Company, the interest
payment with respect to a Security surrendered for conversion during the
Interest Period (except in the case of Securities or portions thereof which
have been called for redemption on a Redemption Date within the Interest
Period) shall be payable on such Interest Payment Date to the Holder of such
Securities at the close of business on such Regular Record Date notwithstanding
the conversion of such Securities during such Interest Period.


As soon as practicable after the Conversion Date,
the Company shall deliver to the Holder, through the Conversion Agent, a
certificate for the number of full shares of Common Stock issuable upon the
conversion and cash in lieu of any fractional share determined pursuant to
Section 10.03.  The person in whose name
the certificate is registered shall be treated as a stockholder of record on
and after the Conversion Date; provided, however, that no surrender of a
Security on any date when the stock transfer books of the Company shall be
closed shall be effective to constitute the person or persons entitled to
receive the shares of Common Stock upon such conversion as the record holder or
holders of such shares of Common Stock on such date, but such surrender shall
be effective to constitute the person or persons entitled to receive such
shares of Common Stock as the record holder or holders thereof for all purposes
at the close of business on the next succeeding day on which such stock
transfer books are open; such conversion shall be at the Conversion Price in
effect on the date that such Security shall have been surrendered for
conversion, as if the stock transfer books of the Company had not been
closed.  Upon conversion of a Security,
such person shall no longer be a Holder of such Security.


 


40

















 


No payment or adjustment will be made for dividends
on or other distribution with respect to any Common Stock except as provided in
this Article 10.


If the Holder converts more than one Security at the
same time, the number of shares of Common Stock issuable upon the conversion
shall be based on the total principal amount of the Securities converted.


Upon surrender of a Security that is converted in
part, the Company shall execute, and the Trustee shall authenticate and deliver
to the Holder, a new Security in an authorized denomination equal in principal
amount to the unconverted portion of the Security surrendered.


If the last day on which a Security may be converted
is a Legal Holiday in a place where a Conversion Agent is located, the Security
may be surrendered to that Conversion Agent on the next succeeding day that it
is not a Legal Holiday.


Section 10.03.  Fractional Shares. 
The Company will not issue a fractional share of Common Stock upon
conversion of a Security.  Instead, the
Company will deliver cash for the current market value of the fractional
share.  The current market value of a
fractional share shall be determined to the nearest 1/10,000th of a share by
multiplying the last reported sale price (determined as set forth in the
definition of Current Market Price), on the last Trading Day prior to the
Conversion Date, of a full share by the fractional amount and rounding the
product to the nearest whole cent.


Section 10.04.  Taxes on Conversion. 
If a Holder converts a Security, the Company shall pay any documentary,
stamp or similar issue or transfer tax due on the issue of shares of Common
Stock upon the conversion.  However, the
Holder shall pay any such tax which is due because the Holder requests the
shares to be issued in a name other than the Holder’s name.  The Conversion Agent may refuse to deliver
the certificates representing the Common Stock being issued in a name other
than the Holder’s name until the Conversion Agent receives a sum sufficient to
pay any tax which will be due because the shares are to be issued in a name
other than the Holder’s name.  Nothing
herein shall preclude any tax withholding required by law or regulations.


Section 10.05.  Company to Provide Stock. 
The Company shall, prior to issuance of any Securities hereunder, and
from time to time as may be necessary, reserve out of its authorized but
unissued Common Stock a sufficient number of shares of Common Stock to permit
the conversion of the Securities.


All shares of Common Stock delivered upon conversion
of the Securities shall be newly issued shares or treasury shares, shall be
duly and validly issued 


 


41

















 


and fully paid and
nonassessable and shall be free from preemptive rights and free of any lien or
adverse claim.


The Company will endeavor promptly to comply with
all Federal and state securities laws regulating the offer and delivery of
shares of Common Stock upon conversion of Securities, if any, and will endeavor
promptly, if permitted by the rules of such exchange, over-the-counter market
or other market, to list or cause to have quoted such shares of Common Stock on
each national Securities exchange or in the over-the-counter market or such
other market on which the Common Stock is then listed or quoted.


Section 10.06.  Adjustment for Change in Capital Stock. 
In case the Company shall (i) pay a dividend, or make a distribution,
in shares of its Common Stock, on its Common Stock, (ii) subdivide its
outstanding Common Stock into a greater number of shares, or (iii) combine its
outstanding Common Stock into a smaller number of shares, the Conversion Price
in effect immediately prior thereto shall be adjusted so that the holder of any
Security thereafter surrendered for conversion shall be entitled to receive the
number of shares of Common Stock of the Company which he would have owned or
have been entitled to receive after the happening of any of the events described
above had such Security been converted immediately prior to the happening of
such event.  If any dividend or
distribution of the type described in clause (i) above is not so paid or made,
the Conversion Price shall again be adjusted to the Conversion Price which
would then be in effect if such dividend or distribution had not been
declared.  An adjustment made pursuant
to this Section 10.06 shall become effective immediately after the record date
in the case of a dividend and shall become effective immediately after the
effective date in the case of subdivision or combination.


Section 10.07.  Adjustment for Rights Issue. 
In case the Company shall issue rights or warrants to all holders of
its Common Stock entitling them (for a period expiring within 45 days after the
record date mentioned below) to subscribe for or purchase Common Stock at a
price per share less than the Current Market Price per share of Common Stock at
the record date for the determination of stockholders entitled to receive such
rights or warrants, the Conversion Price in effect immediately prior thereto
shall be adjusted so that the same shall equal the Conversion Price determined
by multiplying the Conversion Price in effect immediately prior to the date of
issuance of such rights or warrants by a fraction of which the numerator shall
be the number of shares of Common Stock outstanding on the date of issuance of
such rights or warrants plus the number of shares which the aggregate offering
price of the total number of shares so offered would purchase at such Current
Market Price, and of which the denominator shall be the number of shares of
Common Stock outstanding on the date of issuance of such rights or warrants
plus the number of additional shares of Common Stock offered for subscription
or purchase.  Such adjustment shall be
made successively 


 


42

















 


whenever
any such rights or warrants are issued, and shall become effective immediately
after the opening of business on the day following the record date for the
determination of the stockholders entitled to receive such rights or
warrants.  To the extent that shares of
Common Stock are not delivered after the expiration of such rights or warrants,
the Conversion Price shall be readjusted to the Conversion Price which 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 Price shall again be
adjusted to be the Conversion Price which would then be in effect if such
record date 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, the value of such consideration, if
other than cash, to be determined by the Board of Directors.


Section 10.08.  Adjustment for Other Distributions. 
(a) In case the Company shall distribute to all holders of its Common
Stock (excluding any distribution in connection with the liquidation,
dissolution or winding up of the Company, whether voluntary or involuntary) any
shares of any class of capital stock of the Company (other than Common Stock)
or evidences of its indebtedness or assets (other than cash) or rights or
warrants to subscribe for or purchase any of its securities (excluding those
referred to in Section 10.07 hereof) (any of the foregoing hereinafter in this
Section 10.08(a) called the “Distributed Securities”), then, in each
case, the Conversion Price shall be adjusted so that the same shall equal the
Conversion Price determined by multiplying the Conversion Price in effect
immediately prior to the date of such distribution by a fraction of which the
numerator shall be the Current Market Price per share of the Common Stock on
the record date mentioned below less the fair market value on such record date
(as determined by the Board of Directors of the Company, whose determination shall
be conclusive, and described in a certificate filed with the Trustee) of the
Distributed Securities so distributed applicable to one share of Common Stock,
and the denominator shall be the Current Market Price per share of the Common
Stock on such record date.  Such
adjustment shall become effective immediately after the record date for the
determination of stockholders entitled to receive such distribution.  Notwithstanding the foregoing, in the event
the then fair market value (as so determined) of the portion of the Distributed
Securities so distributed applicable to one share of Common Stock is equal to
or greater than the Current Market Price of the Common Stock on the relevant
record date, in lieu of the foregoing adjustment, adequate provision shall be
made so that each Securityholder shall have the right to receive upon
conversion the amount of Distributed Securities such Holder would have received
had such 


 


43

















 


Holder
converted each Security on such record date. 
In the event that such distribution is not so paid or made, the
Conversion Price shall again be adjusted to the Conversion Price which would
then be in effect if such distribution had not been declared.  If the Board of Director determines the fair
market value of any distribution for purposes of this Section 10.08(a) 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 of the Common Stock.


Notwithstanding the foregoing provisions of this
Section 10.08(a), no adjustment shall be made thereunder for any distribution
of Distributed Securities if the Company makes proper provision so that each
Holder of a Security who converts such Security (or any portion thereof) after
the record date for such distribution shall be entitled to receive upon such
conversion, in addition to the shares of Common Stock issuable upon such
conversion, the amount and kind of Distributed Securities that such Holder
would have been entitled to receive if such Holder had, immediately prior to
such record date, converted such Security into Common Stock, provided that,
with respect to any Distributed Securities that are convertible, exchangeable
or exercisable, the foregoing provision shall only apply to the extent (and so
long as) the Distributed Securities receivable upon conversion of such Security
would be convertible, exchangeable or exercisable, as applicable, without any
loss of rights or privileges for a period of at least 60 days following
conversion of such Security.


(b)   In case the Company shall, by dividend or
otherwise, distribute to all holders of its Common Stock cash (excluding (x)
any quarterly cash dividend 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 such preceding
quarterly dividend did not require any adjustment of the Conversion Price
pursuant to this Section 10.08(b) (as adjusted to reflect subdivisions or
combinations of the Common Stock), and (B) 3.75% of the average of the last
reported sales prices of the Common Stock (determined as provided in the
definition of Current Market Price) during the ten Trading Days next preceding
the date of declaration of such dividend and (y) any dividend or distribution
in connection with the liquidation, dissolution or winding up of the Company,
whether voluntary or involuntary), then, in such case, unless the Company
elects to reserve such cash for distribution to the holders of the Securities
upon the conversion of the Securities so that any such holder converting
Securities will receive upon such conversion, in addition to the shares of
Common Stock to which such holder is entitled, the amount of cash which such
holder would have received if such holder had, immediately prior to the record
date for such distribution of cash, converted its Securities into Common Stock,
the Conversion Price shall be decreased so that the same shall equal the
Conversion Price determined by multiplying the Conversion Price in effect
immediately prior 


 


44

















 


to the record date by a
fraction of which the numerator shall be the Current Market Price of the Common
Stock on the record date less the amount of cash so distributed (and not
excluded as provided above) applicable to one share of Common Stock, and the
denominator shall be such Current Market Price of the Common Stock, such
decrease to be effective immediately prior to the opening of business on, the
day following the record date; provided, however, that in the event the portion
of the cash so distributed applicable to one share of Common Stock is equal to
or greater than the Current Market Price of the Common Stock on the record
date, in lieu of the foregoing adjustment, adequate provision shall be made so
that each Securityholder shall have the right to receive upon conversion the
amount of cash such holder would have received had such holder converted each
Security on the record date.  If such
dividend or distribution is not so paid or made, the Conversion Price shall
again be adjusted to be the Conversion Price which 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 10.08(b) 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 10.08(b) 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.


(c)   In case a tender or exchange offer made by
the Company or any Subsidiary of the Company for all or any portion of the Common
Stock shall expire and such tender or exchange offer shall involve the payment
by the Company or such Subsidiary of consideration per share of Common Stock
having a fair market value (as determined by the Board of Directors or, to the
extent permitted by applicable law, a duly authorized committee thereof, whose
determination shall be conclusive, and described in a resolution of the Board
of Directors or such duly authorized committee thereof, as the case may be, at
the last time (the “Expiration Time”) tenders or exchanges may
be made pursuant to such tender or exchange offer (as it shall have been
amended)) that exceeds the Current Market Price of the Common Stock on the
Trading Day next succeeding the Expiration Time, the Conversion Price shall be
decreased so that the same shall equal the Conversion Price determined by
multiplying the Conversion Price in effect immediately prior to the Expiration
Time by a fraction of which the numerator shall be the number of shares of
Common Stock outstanding (including any tendered or exchanged shares) on the
Expiration Time multiplied by the Current Market Price of the Common Stock on
the Trading Day next succeeding the Expiration Time, and the denominator 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 


 


45

















 


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) on
the Expiration Time and the Current Market Price of the Common Stock on the
Trading Day next succeeding the Expiration Time, such decrease to become
effective immediately prior to the opening of business on the day following the
Expiration Time.  In the event that 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 Price shall again be adjusted to be the Conversion Price which would
then be effect if such tender or exchange offer had not been made.


(d)   In case of a tender or exchange offer made by
a Person other than the Company or any Subsidiary for an amount which increases
the offeror’s ownership of Common Stock to more than 25% of the Common Stock
outstanding and shall involve the payment by such person 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) at the last time (the “Offer
Expiration Time”) tenders or exchanges may be made pursuant to such
tender or exchange offer (as it shall have been amended) that exceeds the
Current Market Price of the Common Stock on the Trading Day next succeeding the
Offer Expiration Time, and in which, as of the Offer Expiration Time the Board
of Directors is not recommending rejection of the offer, the Conversion Price
shall be decreased so that the same shall equal the Conversion Price determined
by multiplying the Conversion Price in effect immediately prior to the Offer
Expiration Time by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding (including any tendered or exchanged shares)
on the Offer Expiration Time multiplied by the Current Market Price of the
Common Stock on the Trading Day next succeeding the Offer Expiration Time, and
the denominator 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
Offer Expiration Time (the shares deemed so accepted, up to any such maximum,
being referred to as the “Accepted Purchased Shares”) and (y) the
product of the number of shares of Common Stock outstanding (less any Accepted
Purchased Shares) on the Offer Expiration Time and the Current Market Price of
the Common Stock on the Trading Day next succeeding the Expiration Time, such
decrease to become effective immediately prior to the opening of business on
the day following the Offer Expiration Time. 
In the event that such Person is obligated to purchase shares pursuant
to any such tender or exchange offer, but such Person is permanently prevented
by applicable law from effecting any such purchases or all such purchases are
rescinded, the Conversion Price shall again be adjusted to be 


 


46

















 


the Conversion Price which
would then be in effect if such tender or exchange offer had not been
made.  Notwithstanding the foregoing,
the adjustment described in this Section 10.08(d) shall not be made if as of
the Offer Expiration Time, the offering documents with respect to such offer
disclose a plan or intention to cause the Company to engage in any transaction
described in Article 5.


Section 10.09.  When Adjustment May be Deferred. 
No adjustment in the Conversion Price need be made unless the
adjustment would require an increase or decrease of at least 1% in the
Conversion Price.  Any adjustments that
are not made shall be carried forward and taken into account in any subsequent
adjustment.


All calculations under this Article 10 shall be made
to the nearest cent or to the nearest 1/10,000th of a share, as the case may
be.


Section 10.10.  When no Adjustment Required. 
No adjustment need be made for rights to purchase Common Stock pursuant
to a Company plan for reinvestment of dividends or interest.


No adjustment need be made for a change in the par
value or no par value of the Common Stock.


To the extent the Securities 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
the cash.


Section 10.11.  Notice of Adjustment. 
Whenever the Conversion Price is adjusted, the Company shall promptly
mail to Securityholders a notice of the adjustment.  The Company shall file with the Trustee and the Conversion Agent
such notice.  The certificate shall,
absent manifest error, be conclusive evidence that the adjustment is correct.  Neither the Trustee nor any Conversion Agent
shall be under any duty or responsibility with respect to any such certificate
except to exhibit the same to any Holder desiring inspection thereof.


Section 10.12.  Voluntary Decrease. 
The Company may make such decreases in the Conversion Price, in
addition to those required by Sections 10.06, 10.07 and 10.08, 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 decrease the Conversion Price by any amount for any period of time if the
period is at least 20 days, the decrease is irrevocable during the period and
the Board of Directors 


 


47

















 


shall
have made a determination that such decrease would be in the best interests of
the Company, which determination shall be conclusive.  Whenever the Conversion Price is so decreased, the Company shall
mail to Securityholders and file with the Trustee and the Conversion Agent a
notice of the decrease.  The Company shall
mail the notice at least 15 days before the date the decreased Conversion Price
takes effect.  The notice shall state
the decreased Conversion Price and the period it will be in effect.


Section 10.13.  Notice Of Certain Transactions. 
If:


(a)   the Company makes any distribution or
dividend that would require an adjustment in the Conversion Price pursuant to
Section 10.06, 10.07 or 10.08; or


(b)   the Company takes any action that would
require a supplemental indenture pursuant to Section 10.14; or


(c)   there is a liquidation or dissolution of the
Company;


then the Company shall mail
to Securityholders and file with the Trustee and the Conversion Agent a notice
referencing this Section 10.13 and stating the proposed record date for a
dividend or distribution or the proposed effective date of a subdivision,
combination, reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding-up, and if applicable, the new Conversion
Price.  The Company shall file and mail
the notice at least 15 days before such date. 
Failure to file or mail the notice or any defect in it shall not affect
the validity of the transaction.  Unless
and until the Trustee shall receive a notice pursuant to this Section 10.13, it
shall not be deemed to have knowledge of any event required to be described in
a notice pursuant to this Section 10.13.


Section 10.14.  Effect of Reclassification, Consolidation,
Merger or Sale.  If any of the following
events occur, namely (i) any reclassification or change of outstanding shares
of Common Stock (other than a change in par value, or from par value to no par
value, or from no par value to par value, or as a result of a subdivision or
combination), (ii) any consolidation, merger or combination of the Company with
another corporation as a result of which holders of Common Stock shall be
entitled to receive stock, 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 the properties and assets of the Company as, or substantially
as, an entirety to any other corporation as a result of which holders of Common
Stock shall be entitled to receive stock, 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 corporation, as the case may
be, shall execute with the Trustee a supplemental indenture providing that each
Security shall be convertible into the kind and amount of shares of stock and
other securities or property or assets (including cash) receivable upon such
reclassification, change, consolidation, merger, combination, sale or
conveyance by a holder of a number of shares of Common Stock issuable upon
conversion of such Securities 


 


48

















 


immediately
prior to such reclassification, change, consolidation, merger, combination,
sale or conveyance.  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.


The Company shall cause notice of the execution of
such supplemental indenture to be mailed to each holder of Securities at his
address appearing on the Security register provided for in Section 2.03 of this
Indenture.


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


If this Section applies, neither Section 10.06,
10.07 nor 10.08 applies.


Section 10.15.  Company Determination Final. 
Any determination that the Company or the Board of Directors must make
pursuant to Section 10.03, 10.06, 10.07, 10.08, 10.09, 10.10, 10.14 or 10.17 is
conclusive.


Section 10.16.  Trustee’s Adjustment Disclaimer. 
The Trustee has no duty to determine when an adjustment under this
Article 10 should be made, how it should be made or what it should be.  The Trustee has no duty to determine whether
a supplemental indenture under Section 10.14 need be entered into or whether
any provisions of any supplemental indenture are correct.  The Trustee shall not be accountable for and
makes no representation as to the validity or value of any securities or assets
issued upon conversion of Securities. 
The Trustee shall not be responsible for the Company’s failure to comply
with this Article 10.  Each Conversion
Agent shall have the same protection under this Section 10.16 as the Trustee.


Section 10.17.  Simultaneous Adjustment. 
In the event that this Article 10 requires adjustments to the Conversion
Price under more than one of Sections 10.06, 10.07, 10.08(a) or 10.08(b), and
the record dates for the distributions giving rise to such adjustments shall
occur on the same date, then such adjustments shall be made by applying, first,
the provisions of Section 10.08(a), second, the provisions of Section 10.08(b),
third the provisions of Section 10.06 and, fourth, the provisions of Section
10.07.


Section 10.18.  Successive Adjustments. 
After an adjustment to the Conversion Price under this Article 10, any
subsequent event requiring an adjustment under this Article 10 shall cause an
adjustment to the Conversion Price as so adjusted.


Section 10.19.  Rights Issued in Respect of Common Stock
Issued Upon Conversion.  Each share of
Common Stock issued upon conversion of Securities pursuant to this Article 10
shall be entitled to receive the appropriate number of 


 


49

















 


Rights
(as defined below), if any, and the certificates representing the Common Stock
issued upon such conversion shall bear such legends, if any, in each case as
provided by and subject to the terms of the agreement governing such Rights
(the “Rights
Agreement”) as in effect at the time of such conversion.  If the Rights are separated from the Common
Stock in accordance with the provisions of the Rights Agreement such that the
Holders of Securities would thereafter not be entitled to receive any such
Rights in respect to the Common Stock issuable upon conversion of such
Securities, the Conversion Price will be adjusted as provided in Section
10.08(a) on the separation date; provided that if such Rights expire, terminate
or are redeemed by the Company, the Conversion Price shall again be adjusted to
be the Conversion Price which would then be in effect if such separation had
not occurred.  In lieu of any such
adjustment, the Company may amend the Rights Agreement to provide that upon
conversion of the Securities the Holders will receive, in addition to the Common
Stock issuable upon such conversion, the Rights which would have attached to
such shares of Common Stock if the Rights had not become separated from the
Common Stock pursuant to the provisions of the Rights Agreement.


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”):


(a)   are deemed to be transferred with such shares
of Common Stock,


(b)   are not exercisable, and


(c)   are also issued in respect of future
issuances of Common Stock,


(“Rights”) shall not be deemed
distributed for purposes of Section 10.08(a) until the occurrence of the
earliest Trigger Event.  In addition, in
the event of any distribution of rights or warrants, or any Trigger Event with
respect thereto, that shall have resulted in an adjustment to the Conversion
Price under Section 10.08(a), (1) in the case of any such rights or warrants
which shall all have been redeemed or repurchased without exercise by any
holders thereof, the Conversion Price 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 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 any such rights or warrants
all of which shall have expired without exercise by any holder thereof, the
Conversion Price shall be readjusted as if such issuance had not occurred.


 


50

















 


Section 10.20.  General Considerations. 
Whenever successive adjustments to the Conversion Price are called for
pursuant to this Article 10, such adjustments shall be made to the Current
Market Price as may be necessary or appropriate to effectuate the intent of
this Article and to avoid unjust or inequitable results as determined in good
faith by the Board of Directors.


ARTICLE
11

MISCELLANEOUS


Section 11.01.  Conflict with TIA. 
If any provision hereof limits, qualifies or conflicts with a provision
of the TIA that is required under the TIA to be a part of and govern this
Indenture, the latter provision shall control. 
If any provision of this Indenture modifies or excludes any provision of
the TIA that may be so modified or excluded, the latter provision shall be
deemed to apply to this Indenture as so modified or excluded, as the case may
be.


Section 11.02.  Notices. 
Any request, demand, authorization, notice, waiver, consent or communication
shall be in writing and delivered in person or mailed by first class mail,
postage prepaid, addressed as follows or transmitted by facsimile transmission
(confirmed by overnight courier) to the following facsimile numbers:


if
to the Company:


Silicon Graphics, Inc.

1600 Amphitheatre Parkway

Mountain View, California 94043

Attn:  General Counsel

Telephone Number:  (415) 960-1980

Facsimile Number:  (415) 969-6289


if
to the Trustee:


U.S. Bank National
Association

550 South Hope Street, 5th Floor

Los Angeles, California 90071

Attention:  Corporate Trust Services
(Silicon Graphics, Inc.)

Telephone Number:  (213) 533-8418

Telefax Number:  (213) 533-8729


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


 


51

















 


Any notice or communication given to a
Securityholder shall be mailed to the Securityholder, by first class mail,
postage prepaid, at the Securityholder’s address as it appears on the
registration books of the Registrar and shall be sufficiently given if so
mailed within the time prescribed.


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


If the Company mails a notice or communication to
the Securityholders, it shall mail a copy to the Trustee and each Registrar,
Paying Agent, Conversion Agent or co-registrar.


Section 11.03.  Communication by Holders with Other Holders. 
Securityholders may communicate pursuant to TIA Section 312(b) with
other Securityholders with respect to their rights under this Indenture or the
Securities.  The Company, the Trustee,
the Registrar, the Paying Agent, the Conversion Agent and anyone else shall
have the protection of TIA Section 312(c).


Section 11.04.  Certificate And Opinion as to Conditions
Precedent.  Upon any request or
application by the Company to the Trustee to take any action under this
Indenture, the Company shall furnish to the Trustee:


(a)   an Officers’ Certificate stating that, in the
opinion of the signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and


(b)   an Opinion of Counsel stating that, in the
opinion of such counsel, all such conditions precedent have been complied with.


Section 11.05.  Statements Required in Certificate or
Opinion.  Each Officers’ Certificate
or Opinion of Counsel with respect to compliance with a covenant or condition
provided for in this Indenture shall include:


(a)   a statement that each person making such
Officers’ Certificate or Opinion of Counsel has read such covenant or
condition,


(b)   a brief statement as to the nature and scope
of the examination or investigation upon which the statements or opinions
contained in such Officers’ Certificate or Opinion of Counsel are based;


(c)   a statement that, in the opinion of each such
person, he 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


 


52

















 


(d)   a statement that, in the opinion of such
person, such covenant or condition has been complied with.


Section 11.06.  Separability Clause. 
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.


Section 11.07.  Rules by Trustee, Paying Agent, Conversion
Agent and Registrar.  The Trustee may
make reasonable rules for action by or a meeting of Securityholders.  The Registrar, Conversion Agent and the
Paying Agent may make reasonable rules for their functions.


Section 11.08.  Legal Holidays. 
A “Legal Holiday” is any day other than a Business Day.  If any specified date (including a date for
giving notice) is a Legal Holiday, the action shall be taken on the next
succeeding day that is not a Legal Holiday, and, to the extent applicable, no
interest, if any, shall accrue for the intervening period.


Section 11.09.  Governing Law. 
THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN THIS INDENTURE AND THE
SECURITIES.


Section 11.10.  No Recourse Against Others. 
A director, officer, employee or stockholder, as such, of the Company
shall not have any liability for any obligations of the Company under the
Securities or this Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. 
By accepting a Security, each Securityholder shall waive and release all
such liability.  The waiver and release
shall be part of the consideration for the issue of the Securities.


Section 11.11.  Successors. 
All agreements of the Company in this Indenture and the Securities
shall bind its successor.  All
agreements of the Trustee in this Indenture shall bind its successor.


Section 11.12.  Multiple Originals. 
The parties may sign any number of copies of this Indenture.  Each signed copy shall be an original, but
all of them together represent the same agreement.  One signed copy is enough to prove this Indenture.


 


53

















 


 


IN WITNESS WHEREOF, the undersigned, being duly
authorized, have executed this Indenture on behalf of the respective parties
hereto as of the date first written above.


	
   

  	
  SILICON GRAPHICS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:  Jeffrey Zellmer

  
	
   

  	
   

  	
  Title:  Chief Financial Officer

  



 


 


	
  Attest:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Title:

  	
   

  



 


[SEAL]


 


 


	
   

  	
  U.S. BANK NATIONAL
  ASSOCIATION

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:  Paula M. Oswald

  
	
   

  	
   

  	
  Title:  Vice President

  



 


 


54

















 


 


EXHIBIT A


[FORM OF FACE OF SECURITY]


[FORM OF LEGEND FOR GLOBAL
SECURITY:


UNLESS THIS CERTIFICATE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A
NEW YORK CORPORATION (“DTC”), 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 IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR
TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
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.]


SILICON GRAPHICS, INC.


6.50% SENIOR CONVERTIBLE
NOTE DUE 2009


	
  No.

  	
  $

  	
   

  
	
   

  	
  CUSIP

  	
   

  



 


Silicon Graphics, Inc., a Delaware corporation,
promises to pay to or registered assigns, the principal amount of_____________
Dollars ($) on July 1, 2009 and to pay interest thereon from  [the date after expiration of the exchange
offer], 2003 or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, semi-annually on January 1 and July 1 in
each year, commencing January 1, 2004, at the rate of 6.50% per annum until the
principal hereof is paid or made available for payment.  The interest so payable, and punctually paid
or duly provided for, on any Interest Payment Date will, as provided in such
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the December 15 or June  15 (whether or not a Business Day), as the
case may be, next preceding such Interest Payment Date. Any such interest not
so punctually paid or duly provided for will forthwith cease to be payable to
the Holder on such Regular Record Date and may either be paid to the Person in
whose name this Security (or one or more Predecessor Securities) is registered
at the close of business on a Special Record Date for the payment of such
Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to
Holders of Securities not less than 10 days prior to such Special Record Date,
or be paid at any time in any other lawful manner not 


 


A-1

















 


inconsistent with the
requirements of any securities exchange or other market on which the Securities
may be listed, and upon such notice as may be required by such exchange or
market, all as more fully provided in said Indenture.  Payment of the principal of (and premium, if any) and interest on
this Security will be made at the Corporate Trust Office or the office or
agency of the Company maintained for that purposes in the Borough of Manhattan,
The City of New York, New York in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts; provided, however, that at the option of the Company payment of
interest may be made by check mailed to the address of, or by wire transfer to
the account of, the Person entitled thereto as such address shall appear in the
Security Register.


Additional provisions of this Security are set forth
on the other side of this Security.


 


 


A-2

















 


 


IN WITNESS WHEREOF, Silicon Graphics, Inc.  has caused this instrument to be duly
executed under its corporate seal.


	
   

  	
  SILICON GRAPHICS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  



 


[SEAL]


 


 


	
  Attest:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  TRUSTEE’S CERTIFICATE OF
  AUTHENTICATION

  	
   

  
	
   

  	
   

  	
   

  
	
  This is one of the
  Securities referred to in the within mentioned Indenture.

  	
   

  
	
   

  	
   

  	
   

  
	
  U.S. BANK NATIONAL
  ASSOCIATION, as Trustee,

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  



 


 


A-3

















 


 


[FORM OF REVERSE SIDE OF
SECURITY]


SILICON GRAPHICS, INC.


6.50% SENIOR CONVERTIBLE
NOTE DUE 2009


1.             Interest


This Security shall bear interest at 6.50% per annum
in the manner set forth in the Indenture and the face of this Security.  In the event that principal hereof or any
portion of such principal is not paid when due (whether upon acceleration
pursuant to Section 6.02 of the Indenture, upon the date set for payment of the
Redemption Price pursuant to paragraph 5 hereof, upon the date set for payment
of a Fundamental Change Redemption Price pursuant to paragraph 6 hereof or upon
the Stated Maturity of this Security), then in each such case the overdue
amount shall bear interest at the rate of 6.50% per annum, compounded semiannually
(to the extent that the payment of such interest shall be legally enforceable),
which interest shall accrue from the date such overdue amount was due to the
date payment of such amount, including interest thereon, has been made or duly
provided for.  All such interest shall
be payable on demand.


2.             Method of Payment


Subject to the terms and conditions of the
Indenture, the Company will make payments in respect of the Securities to the
persons who are registered Holders of Securities at the close of business on
the Redemption Date, Fundamental Change Repurchase Date or Stated Maturity, as
the case may be.  Holders must surrender
Securities to a Paying Agent to collect such payments in respect of the
Securities.  The Company will pay cash
amounts in money of the United States that at the time of payment is legal
tender for payment of public and private debts.  However, the Company may make such cash payments by check mailed
to the address of, or by wire transfer to the account of, the person entitled
to such payment.


3.             Paying Agent,
Conversion Agent and Registrar


Initially, U.S. Bank National Association, a
national banking association (the “Trustee”), will act as Paying Agent,
Conversion Agent and Registrar.  The
Company may appoint and change any Paying Agent, Conversion Agent, Registrar or
co-registrar without notice, other than notice to the Trustee.  The Company or any of its Subsidiaries or
any of their Affiliates may act as Paying Agent, Conversion Agent, Registrar or
co-registrar.


 


A-4

















 


4.             Indenture


The Company issued the Securities under an Indenture
dated as of           , 2003 (the “Indenture”),
between the Company and the Trustee. 
Capitalized terms used herein and not defined herein have the meanings
ascribed thereto in the Indenture.  The
Securities are subject to all such terms, and Securityholders are referred to
the Indenture for a statement of those terms.


The Securities are general unsecured obligations of
the Company limited to $120,000,000 aggregate principal amount (subject to
Sections 2.02 and 2.07 of the Indenture).


5.             Redemption at the
Option of the Company


Prior to the second anniversary of the original
issuance of the Securities, the Securities will not be redeemable at the option
of the Company.  Beginning on the second
anniversary of the original issuance of the Securities, the Company may redeem
the Securities for cash as a whole at any time, or from time to time in part,
upon not less than 10 days’ nor more than 60 days’ notice at a price equal to
100% of the principal amount (the “Redemption Price”) thereof, together with
accrued and unpaid interest to, but excluding, the Redemption Date, provided
that during the year beginning on the second anniversary of the original
issuance of the Securities, the Company may only redeem the Securities if the
Closing Price of the Company’s Common Stock has been at least 150% of the
then-applicable Conversion Price for the 20 consecutive Trading Days ending two
Trading Days prior to the notice of redemption.


If any Redemption Date is an
Interest Payment Date, then the interest payable on such date shall be paid to
the Holder of the Security on the next preceding Regular Record Date.  No Securities may be redeemed by the Company
if an Event of Default with respect to the payment of interest on the
Securities has occurred and is continuing.


No sinking fund is provided for the Securities.


Notice of redemption at the option of the Company
will be mailed at least 30 days but not more than 60 days before the Redemption
Date to each Holder of Securities to be redeemed at the Holder’s registered
address.  If money sufficient to pay the
Redemption Price, together with accrued interest to, but excluding, the
Redemption Date, of all Securities (or portions thereof) to be redeemed on the
Redemption Date is deposited with the Paying Agent prior to or on the
Redemption Date, on and after such date interest ceases to accrue on such
Securities or portions thereof. 
Securities in denominations larger than $1,000 of principal amount may
be redeemed in part but only in multiples of $1,000 of principal amount.


 


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6.             Redemption at the
Option of the Holder Upon a Fundamental Change


(a)           At the option of the Holder and
subject to the terms and conditions of the Indenture, the Company shall become
obligated to redeem the Securities held by such Holder on the date (the “Fundamental
Change Repurchase Date”) (or if such date is not a Business Day, the
next succeeding Business Day) that is 45 days after the date of the Company’s
notice of such Fundamental Change (as defined in the Indenture) occurring on or
prior to July 1, 2009 at 100% of the principal amount.  In each case, the Company shall also pay
accrued but unpaid interest, if any, on such Securities to, but excluding, the
Fundamental Change Repurchase Date; provided that if such Fundamental Change
Repurchase Date is an Interest Payment Date, then the interest payable on such
date shall be paid to the Holder of the Security on the next preceding Regular
Record Date.  Securities in
denominations larger than $1,000 of principal amount may be redeemed in part in
connection with a Fundamental Change, but only in multiples of $1,000 of
principal amount.


(b)           Holders have the right to withdraw
any Fundamental Change Redemption Notice by delivering to the Paying Agent a
written notice of withdrawal in accordance with the provisions of the
Indenture.


(c)           If cash sufficient to pay the
Fundamental Change Redemption Price, together with accrued interest to, but
excluding, the Fundamental Change Repurchase Date, of all Securities or
portions thereof to be purchased as of the Fundamental Change Repurchase Date
is deposited with the Paying Agent on or prior to the Fundamental Change
Repurchase Date, interest ceases to accrue on such Securities (or portions
thereof) on and after the Fundamental Change Repurchase Date, and the Holder
thereof shall have no other rights as such (other than the right to receive the
Fundamental Change Redemption Price, together with accrued interest to, but
excluding, the Fundamental Change Repurchase Date, upon surrender of such
Security).


7.             Conversion


Subject to the next two succeeding sentences, a
Holder of a Security may convert it into Common Stock of the Company at any
time after issuance and before the close of business on July 1, 2009.  If the Security is called for redemption,
the Holder may convert it at any time before the close of the last Trading Day
prior to the Redemption Date.  In the
event the Security is surrendered during the period from the close of business
on any Regular Record Date next preceding any Interest Payment Date to the
close of business on the Trading Day immediately preceding the next succeeding
Interest Payment Date (except in the case of Security to be redeemed within
such period), such Securities must be accompanied by payment in New York
Clearing House funds or other funds acceptable to the Company of an amount
equal to the interest payable on 


 


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such Interest Payment Date
on the principal amount of this Security then being converted.  Subject to the aforesaid requirement for
payment and, in the case of a conversion after the Regular Record Date next
preceding any Interest Payment Date and on or before such Interest Payment
Date, to the right of the Holder of this Security (or any Predecessor Security)
of record at such Regular Record Date to receive an installment of interest
payable on such Interest Payment Date (except in the case of Securities whose
Maturity is prior to such Interest Payment Date), no payment or adjustment is
to be made on conversion for interest accrued hereon or for dividends on the
Common Stock issued on conversion.  A Security
in respect of which a Holder has delivered a notice of exercise of the option
to redeem such Security in the event of a Fundamental Change may be converted
only if the notice of exercise is withdrawn in accordance with the terms of the
Indenture.


The initial Conversion Price is $3.00 per share of
Common Stock, subject to adjustment in certain events described in the
Indenture.  The Company will deliver
cash or a check in lieu of any fractional share of Common Stock.


To convert a Security a Holder must (1) complete and
manually sign the conversion notice on the back of the Security (or complete
and manually sign a facsimile of such notice) and deliver such notice to the
Conversion Agent, (2) surrender the Security to a Conversion Agent, (3) furnish
appropriate endorsements and transfer documents if required by the Conversion
Agent, the Company or the Trustee and (4) pay any transfer or similar tax, if
required.


A Holder may convert a portion of a Security if the
principal amount of such portion is $1,000 or a multiple of $1,000.  No payment or adjustment will be made for
dividends on the Common Stock except as provided in the indenture.


The Conversion Price is subject to adjustment as
provided in the Indenture.  In addition,
in the case of (i) any reclassification of the Common Stock, or (ii) a
consolidation or merger involving the Company or a sale or conveyance to another corporation of the property and assets of
the Company as an entirety (or substantially as an entirety), in each case as a
result of which holders of Common Stock shall be entitled to receive stock, securities, other property or assets
(including cash) with respect to or in exchange for such Common Stock, as set
forth in the Indenture, or upon certain distributions described in the
Indenture, the right to convert a Security into Common Stock may be changed; as
set forth in the Indenture, into a right to convert it into securities, cash or
other assets of the Company or another person.


8.             Conversion
Arrangement on Call for Redemption


Any Securities called for redemption, unless surrendered
for conversion before the close of business on the last Trading Day prior to
the Redemption Date, 


 


A-7

















 


may be deemed to be
purchased from the Holders of such Securities at an amount not less than the
Redemption Price, together with accrued interest to, but excluding the
Redemption Date, by one or more investment bankers or other purchasers who may
agree with the Company to purchase such Securities from the Holders, to convert
them into Common Stock of the Company and to make payment for such Securities
to the Trustee in trust for such Holders.


9.             Denominations;
Transfer; Exchange


The Securities are in registered form, without
coupons, in denominations of $1,000 of principal amount and multiples of
$1,000.  A Holder may transfer or
exchange Securities in accordance with the Indenture.  The Registrar may require a Holder, among other things, to
furnish appropriate endorsements and transfer documents and to pay any taxes
and fees required by law or permitted by the Indenture.  The Registrar need not transfer or exchange
any Securities selected for redemption (except, in the case of a Security to be
redeemed in part, the portion of the Security not to be redeemed) or any
Securities in respect of which a Fundamental Change Redemption Notice has been
given and not withdrawn (except, in the case of a Security to be purchased in
part, the portion of the Security not to be purchased) or any Securities for a
period of 15 days before a selection of Securities to be redeemed.


10.          Persons Deemed Owners


The registered Holder of this Security may be
treated as the owner of this Security for all purposes.


11.          Unclaimed Money or
Securities


The Trustee and the Paying Agent shall return to the
Company upon written request any money or securities held by them for the
payment of any amount with respect to the Securities that remains unclaimed for
two years, provided, however, that the Trustee or such Paying Agent, before
being required to make any such return, shall at the expense of the Company
cause to be published once in a newspaper of general circulation in The City of
New York or mail to each such Holder notice that such money or securities
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such publication or mailing, any unclaimed
money or securities then remaining will be returned to the Company.  After return to the Company, Holders
entitled to the money or securities must look to the Company for payment as
general creditors unless an applicable abandoned property law designates
another person.


 


A-8

















 


12.          Amendment; Waiver


Subject to certain exceptions set forth in the
Indenture, (i) the Indenture or the Securities may be amended with the written
consent of the Holders of at least a majority in aggregate principal amount of
the Securities at the time outstanding and (ii) certain defaults or
noncompliance with certain provisions may be waived with the written consent of
the Holders of a majority in aggregate principal amount of the Securities at
the time outstanding.  Subject to
certain exceptions set forth in the Indenture, without the consent of any
Securityholder, the Company and the Trustee may amend the Indenture or the
Securities to cure any ambiguity, defect or inconsistency, or to comply with
Article 5 or Section 10.14 of the Indenture, to provide for uncertificated
Securities in addition to or in place of certificated Securities or to make any
change that does not adversely affect the rights of any Securityholder or to
comply with any requirement of the SEC in connection with the qualification of
the Indenture under the TIA.


13.          Defaults and Remedies


Under the Indenture, Events of Default include (i)
default in payment of the principal amount, Redemption Price or Fundamental
Change Redemption Price, as the case may be, in respect of the Securities when
the same becomes due and payable; (ii) default for 30 days in the payment of
any installment of interest on the Securities; (iii) failure by the Company to
comply with other agreements in the Indenture or the Securities, subject to
notice and lapse of time; (iv) an event of default under the Secured Credit
Facility, the Old Notes Indenture or the New Indenture shall have occurred that
results in the principal amount of and accrued interest on that debt becoming
immediately due and payable, and (v) certain events of bankruptcy or
insolvency.  If an Event of Default occurs
and is continuing, the Trustee, or the Holders of at least 25% in aggregate
principal amount of the Securities at the time outstanding, may declare all the
Securities to be due and payable immediately. 
Certain events of bankruptcy or insolvency are Events of Default which
will result in the Securities being declared due and payable immediately upon
the occurrence of such Events of Default.


Securityholders may not enforce the Indenture or the
Securities except as provided in the Indenture.  The Trustee may refuse to enforce the Indenture or the Securities
unless it receives reasonable indemnity or security.  Subject to certain limitations, Holders of a majority in
aggregate principal amount of the Securities at the time outstanding may direct
the Trustee in its exercise of any trust or power.  The Trustee may withhold from Securityholders notice of any
continuing Default (except a Default in payment of amounts specified in clause
(i) or (ii) above) if it determines that withholding notice is in their
interests.


 


A-9

















 


14.          Trustee Dealings with
the Company


The Trustee under the Indenture, in its individual
or any other capacity, may become the owner or pledgee of Securities and may
otherwise deal with and collect obligations owed to it by the Company or its
Affiliates and may otherwise deal with the Company or its Affiliates with the
same rights it would have if it were not Trustee.


15.          No Recourse Against
Others


A director, officer, employee or stockholder, as
such, of the Company shall not have any liability for any obligations of the
Company under the Securities or the Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation.  By accepting a Security, each Securityholder
waives and releases all such liability. 
The waiver and release are part of the consideration for the issue of
the Securities.


16.          Authentication


This Security shall not be valid until an authorized
officer of the Trustee manually signs the Trustee’s Certificate of
Authentication on the other side of this Security.


17.          Abbreviations


Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT
(=tenants by the entireties), JT TEN (=joint tenants with right of survivorship
and not as tenants in common), CUST (=custodian), and U/G/M/A (Uniform Gift to
Minors Act).


18.          Governing Law


THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN THE
INDENTURE AND THIS SECURITY.












The Company will furnish to any Securityholder upon
written request and without charge a copy of the Indenture which has in it the
text of this Security in larger type. 
Requests may be made to:


Silicon Graphics, Inc.

1600 Amphitheatre Parkway

Mountain View, California 94043

Attn:  General Counsel


 


 


A-10

















 


[FORM OF CONVERSION NOTICE]


CONVERSION NOTICE


To:  Silicon Graphics, Inc.


The undersigned registered holder of this Security
hereby irrevocably exercises the option to convert this Security, or portion
hereof (which is $1,000 principal amount or a multiple thereof) below
designated, into shares of Common Stock of Silicon Graphics, Inc.  in accordance with the terms of the
Indenture referred to in this Security, and directs that the shares issuable
and deliverable upon such conversion, together with any check in payment for
fractional shares and any Securities representing any unconverted principal
amount hereof, be issued and delivered to the registered holder hereof unless a
different name has been indicated below. 
If shares or any portion of this Security not converted are to be issued
in the name of a person other than the undersigned, the undersigned will pay
all transfer taxes payable with respect thereto.


Dated:


	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature(s)

  



 


 


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  Fill in for registration
  of shares if to be delivered, and Securities if to be issued other than to
  and in the name of the registered bolder:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  (Name)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  (Street
  Address)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  (City,
  State and zip code)

  	
   

  
	
   

  	
   

  
	
  Please
  print name and address

  	
   

  
	
   

  	
   

  



 


	
   

  	
  principal
  amount to be converted

  (if less than all):

  
	
   

  	
   

  
	
   

  	
  $_____,000

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Social
  Security or Other

  Taxpayer Identification Number

  



 


 


A-12

















 


 


[FORM OF OPTION TO ELECT
REDEMPTION

UPON A FUNDAMENTAL CHANGE]


To:          Silicon Graphics, Inc.


The undersigned registered holder of this Security
hereby acknowledges receipt of a notice from Silicon Graphics, Inc.  (the “Company”) as to the occurrence of a
Fundamental Change with respect to the Company and requests and instructs the
Company to redeem this Security, or the portion hereof (which is $1,000
principal amount or a multiple thereof) below designated, in accordance with
the terms of the Indenture referred to in this Security.


	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Signature(s)

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  principal
  amount to be redeemed

  (if less than all):

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  $__________

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Social
  Security or Other

  Taxpayer Identification Number

  



 


 


A-13

















 


 


[FORM OF 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 Security and hereby irrevocably
constitutes and appoints ____________________ attorney to transfer the said
Security on the books of the Company, with full power of substitution in the
premises.


 


	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Signature(s)

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Signature(s)
  must be guaranteed by a

  commercial bank or trust company or a

  member firm of a major stock exchange.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Signature
  Guarantee

  



 


 


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


 


 


A-14