EXHIBIT 4.1


 




 





 


 


Protein Design Labs, Inc.



and



J.P. Morgan Trust Company, National Association



as Trustee


 


_________________________________


INDENTURE


Dated as of July 14, 2003


_________________________________


 


 


$250,000,000 Principal Amount


2.75%
Convertible Subordinated Notes due 2023


 


 




 





 


 

















 


CROSS-REFERENCE TABLE


	
  TIA

  Indenture

  	
   

  	
  Indenture

  Section

  
	
  310

  	
  (a)(1)

  	
   

  	
  7.10

  
	
   

  	
  (a)(2)

  	
   

  	
  7.10

  
	
   

  	
  (a)(3)

  	
   

  	
  N.A.

  
	
   

  	
  (a)(4)

  	
   

  	
  N.A.

  
	
   

  	
  (a)(5)

  	
   

  	
  N.A.

  
	
   

  	
  (b)

  	
   

  	
  7.08;
  7.10; 13.02

  
	
   

  	
  (c)

  	
   

  	
  N.A.

  
	
  311

  	
  (a)

  	
   

  	
  7.11

  
	
   

  	
  (b)

  	
   

  	
  7.11

  
	
   

  	
  (c)

  	
   

  	
  N.A.

  
	
  312

  	
  (a)

  	
   

  	
  2.05

  
	
   

  	
  (b)

  	
   

  	
  13.03

  
	
   

  	
  (c)

  	
   

  	
  13.03

  
	
  313

  	
  (a)

  	
   

  	
  7.06

  
	
   

  	
  (b)(1)

  	
   

  	
  N.A.

  
	
   

  	
  (b)(2)

  	
   

  	
  7.06

  
	
   

  	
  (c)

  	
   

  	
  7.06;
  13.02

  
	
   

  	
  (d)

  	
   

  	
  7.06

  
	
  314

  	
  (a)

  	
   

  	
  4.02

  
	
   

  	
  (b)

  	
   

  	
  12.05

  
	
   

  	
  (c)(1)

  	
   

  	
  13.04

  
	
   

  	
  (c)(2)

  	
   

  	
  13.04

  
	
   

  	
  (c)(3)

  	
   

  	
  N.A.

  
	
   

  	
  (d)

  	
   

  	
  12.03

  
	
   

  	
  (e)

  	
   

  	
  13.05

  
	
   

  	
  (f)

  	
   

  	
  N.A.

  
	
  315

  	
  (a)

  	
   

  	
  7.01(B)

  
	
   

  	
  (b)

  	
   

  	
  7.05;
  13.02

  
	
   

  	
  (c)

  	
   

  	
  7.01(A)

  
	
   

  	
  (d)

  	
   

  	
  7.01(C)

  
	
   

  	
  (e)

  	
   

  	
  6.11

  
	
  316

  	
  (a)(last
  sentence)

  	
   

  	
  2.09

  
	
   

  	
  (a)(1)(A)

  	
   

  	
  6.05

  
	
   

  	
  (a)(1)(B)

  	
   

  	
  6.04

  
	
   

  	
  (a)(2)

  	
   

  	
  N.A.

  
	
   

  	
  (b)

  	
   

  	
  6.07

  
	
   

  	
  (c)

  	
   

  	
  N.A.

  
	
   

  	
  317(a)(1)

  	
   

  	
  6.08

  
	
   

  	
  (a)(2)

  	
   

  	
  6.09

  
	
   

  	
  (b)

  	
   

  	
  2.04

  
	
  318

  	
  (a)

  	
   

  	
  13.01

  



 


I

















 


TABLE OF CONTENTS


	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  I.

  	
  DEFINITIONS
  AND INCORPORATION BY REFERENCE

  	
  1

  
	
   

  	
   

  	
   

  
	
   

  	
  1.01 Definitions.

  	
  1

  
	
   

  	
  1.02
  Other Definitions.

  	
  5

  
	
   

  	
  1.03
  Incorporation by Reference of Trust Indenture Act.

  	
  6

  
	
   

  	
  1.04 Rules of Construction.

  	
  7

  
	
   

  	
   

  	
   

  
	
  II.

  	
  THE SECURITIES

  	
  7

  
	
   

  	
   

  	
   

  
	
   

  	
  2.01
  Form and Dating.

  	
  7

  
	
   

  	
  2.02 Execution and
  Authentication.

  	
  7

  
	
   

  	
  2.03
  Registrar, Paying Agent and Conversion Agent.

  	
  8

  
	
   

  	
  2.04 Paying
  Agent To Hold Money in Trust.

  	
  9

  
	
   

  	
  2.05 Securityholder Lists.

  	
  9

  
	
   

  	
  2.06 Transfer and Exchange.

  	
  9

  
	
   

  	
  2.07 Replacement
  Securities.

  	
  10

  
	
   

  	
  2.08 Outstanding
  Securities.

  	
  10

  
	
   

  	
  2.09
  Securities Held by the Company or an Affiliate.

  	
  11

  
	
   

  	
  2.10 Temporary Securities.

  	
  11

  
	
   

  	
  2.11 Cancellation.

  	
  11

  
	
   

  	
  2.12
  Defaulted Interest.

  	
  11

  
	
   

  	
  2.13 CUSIP Numbers.

  	
  12

  
	
   

  	
  2.14
  Deposit of Moneys.

  	
  12

  
	
   

  	
  2.15
  Book-Entry Provisions for Global Securities.

  	
  12

  
	
   

  	
  2.16 Special Transfer
  Provisions.

  	
  13

  
	
   

  	
  2.17
  Restrictive Legends.

  	
  14

  
	
   

  	
   

  	
   

  
	
  III.

  	
  REDEMPTION

  	
  14

  
	
   

  	
   

  	
   

  
	
   

  	
  3.01
  Right of Redemption.

  	
  14

  
	
   

  	
  3.02
  Notices to Trustee.

  	
  15

  
	
   

  	
  3.03
  Selection of Securities to Be Redeemed.

  	
  15

  
	
   

  	
  3.04 Notice of Redemption.

  	
  15

  
	
   

  	
  3.05 Effect of
  Notice of Redemption.

  	
  16

  
	
   

  	
  3.06 Deposit of
  Redemption Price.

  	
  16

  
	
   

  	
  3.07 Securities
  Redeemed in Part.

  	
  17

  
	
   

  	
  3.08
  Purchase of Securities at Option of the Holder.

  	
  17

  
	
   

  	
  3.09
  Repurchase at Option of Holder upon a Repurchase Event.

  	
  24

  
	
   

  	
  3.10
  Conversion Arrangement on Call for Redemption.

  	
  28

  
	
   

  	
   

  	
   

  
	
  IV.

  	
  COVENANTS

  	
  29

  
	
   

  	
   

  	
   

  
	
   

  	
  4.01 Payment of Securities.

  	
  29

  



 


-i-

















 


	
   

  	
  4.02 Maintenance
  of Office or Agency.

  	
  29

  
	
   

  	
  4.03 Reports.

  	
  30

  
	
   

  	
  4.04 Compliance Certificate.

  	
  30

  
	
   

  	
  4.05 Stay,
  Extension and Usury Laws.

  	
  30

  
	
   

  	
  4.06
  Corporate Existence.

  	
  30

  
	
   

  	
  4.07
  Notice of Default.

  	
  31

  
	
   

  	
   

  	
   

  
	
  V.

  	
  SUCCESSORS

  	
  31

  
	
   

  	
   

  	
   

  
	
   

  	
  5.01 When Company May
  Merge, etc.

  	
  31

  
	
   

  	
  5.02 Successor Substituted.

  	
  32

  
	
   

  	
   

  	
   

  
	
  VI.

  	
  DEFAULTS AND REMEDIES

  	
  32

  
	
   

  	
   

  	
   

  
	
   

  	
  6.01
  Events of Default.

  	
  32

  
	
   

  	
  6.02 Acceleration.

  	
  34

  
	
   

  	
  6.03
  Other Remedies.

  	
  35

  
	
   

  	
  6.04 Waiver of Past
  Defaults.

  	
  35

  
	
   

  	
  6.05
  Control by Majority.

  	
  35

  
	
   

  	
  6.06
  Limitation on Suits.

  	
  35

  
	
   

  	
  6.07 Rights
  of Holders to Receive Payment.

  	
  36

  
	
   

  	
  6.08 Collection Suit
  by Trustee.

  	
  36

  
	
   

  	
  6.09 Trustee May
  File Proofs of Claim.

  	
  36

  
	
   

  	
  6.10 Priorities.

  	
  37

  
	
   

  	
  6.11 Undertaking for Costs.

  	
  37

  
	
   

  	
   

  	
   

  
	
  VII.

  	
  TRUSTEE

  	
  37

  
	
   

  	
   

  	
   

  
	
   

  	
  7.01
  Duties of Trustee.

  	
  37

  
	
   

  	
  7.02
  Rights of Trustee.

  	
  38

  
	
   

  	
  7.03 Individual
  Rights of Trustee.

  	
  40

  
	
   

  	
  7.04 Trustee’s Disclaimer.

  	
  40

  
	
   

  	
  7.05
  Notice of Defaults.

  	
  40

  
	
   

  	
  7.06 Reports by
  Trustee to Holders.

  	
  40

  
	
   

  	
  7.07 Compensation and
  Indemnity.

  	
  41

  
	
   

  	
  7.08 Replacement of
  Trustee.

  	
  41

  
	
   

  	
  7.09 Successor
  Trustee by Merger, etc.

  	
  42

  
	
   

  	
  7.10 Eligibility;
  Disqualification.

  	
  42

  
	
   

  	
  7.11
  Preferential Collection of Claims Against Company.

  	
  42

  
	
   

  	
   

  	
   

  
	
  VIII.

  	
  DISCHARGE OF INDENTURE

  	
  43

  
	
   

  	
   

  	
   

  
	
   

  	
  8.01
  Termination of the Obligations of the Company.

  	
  43

  
	
   

  	
  8.02 Application of
  Trust Money.

  	
  43

  
	
   

  	
  8.03 Repayment to Company.

  	
  43

  
	
   

  	
  8.04
  Reinstatement.

  	
  44

  



 


-ii-

















 


	
  IX.

  	
  AMENDMENTS

  	
  44

  
	
   

  	
   

  	
   

  
	
   

  	
  9.01 Without Consent
  of Holders.

  	
  44

  
	
   

  	
  9.02 With Consent of
  Holders.

  	
  45

  
	
   

  	
  9.03
  Compliance with Trust Indenture Act.

  	
  46

  
	
   

  	
  9.04 Revocation
  and Effect of Consents.

  	
  46

  
	
   

  	
  9.05
  Notation on or Exchange of Securities.

  	
  46

  
	
   

  	
  9.06
  Trustee Protected.

  	
  47

  
	
   

  	
   

  	
   

  
	
  X.

  	
  CONVERSION

  	
  47

  
	
   

  	
   

  	
   

  
	
   

  	
  10.01
  Conversion Privilege; Restrictive Legends.

  	
  47

  
	
   

  	
  10.02 Conversion Procedure.

  	
  47

  
	
   

  	
  10.03
  Fractional Shares.

  	
  48

  
	
   

  	
  10.04 Taxes on Conversion.

  	
  48

  
	
   

  	
  10.05 Company to
  Provide Stock.

  	
  48

  
	
   

  	
  10.06 Adjustment
  of Conversion Rate.

  	
  49

  
	
   

  	
  10.07 No
  Adjustment.

  	
  53

  
	
   

  	
  10.08
  Other Adjustments.

  	
  53

  
	
   

  	
  10.09 Adjustments
  for Tax Purposes.

  	
  53

  
	
   

  	
  10.10 Notice of Adjustment.

  	
  54

  
	
   

  	
  10.11 Notice of
  Certain Transactions.

  	
  54

  
	
   

  	
  10.12
  Effect of Reclassifications, Consolidations, Mergers, Binding Share Exchanges
  or Sales on Conversion Privilege.

  	
  54

  
	
   

  	
  10.13 Trustee’s Disclaimer.

  	
  55

  
	
   

  	
   

  	
   

  
	
  XI.

  	
  SUBORDINATION

  	
  56

  
	
   

  	
   

  	
   

  
	
   

  	
  11.01 Agreement to
  Subordinate.

  	
  56

  
	
   

  	
  11.02 Certain Definitions.

  	
  56

  
	
   

  	
  11.03
  Liquidation; Dissolution; Bankruptcy.

  	
  57

  
	
   

  	
  11.04
  Default on Designated Senior Indebtedness

  	
  57

  
	
   

  	
  11.05 Acceleration of
  Securities.

  	
  58

  
	
   

  	
  11.06 When
  Distribution Must Be Paid Over.

  	
  58

  
	
   

  	
  11.07 Notice by the
  Company.

  	
  59

  
	
   

  	
  11.08 Subrogation.

  	
  59

  
	
   

  	
  11.09
  Relative Rights.

  	
  59

  
	
   

  	
  11.10
  Subordination May Not Be Impaired by the Company.

  	
  60

  
	
   

  	
  11.11
  Distribution or Notice to Representative.

  	
  60

  
	
  .

  	
  11.12 Rights
  of Trustee and Paying Agent

  	
  60

  
	
   

  	
   

  	
   

  
	
  XII.

  	
  SECURITY

  	
  61

  
	
   

  	
   

  	
   

  
	
   

  	
  12.01 Security.

  	
  61

  
	
   

  	
  12.02
  Pledge Agreement.

  	
  61

  
	
   

  	
  12.03
  Release of Pledged Financial Assets.

  	
  61

  
	
   

  	
  12.04
  Disbursements From Pledge Account Upon Conversion or Repurchase.

  	
  62

  



 


-iii-

















 


	
   

  	
  12.05 Opinions of Counsel.

  	
  63

  
	
   

  	
  12.06
  Authorization of Actions to be Taken by the Trustee Under the Pledge
  Agreement.

  	
  63

  
	
   

  	
   

  	
   

  
	
  XIII.

  	
  MISCELLANEOUS

  	
  63

  
	
   

  	
   

  	
   

  
	
   

  	
  13.01 Trust
  Indenture Act Controls.

  	
  63

  
	
   

  	
  13.02 Notices.

  	
  63

  
	
   

  	
  13.03
  Communication by Holders with Other Holders.

  	
  64

  
	
   

  	
  13.04
  Certificate and Opinion as to Conditions Precedent.

  	
  64

  
	
   

  	
  13.05
  Statements Required in Certificate or Opinion.

  	
  65

  
	
   

  	
  13.06 Rules by
  Trustee and Agents.

  	
  65

  
	
   

  	
  13.07
  Legal Holidays.

  	
  65

  
	
   

  	
  13.08 Duplicate Originals.

  	
  65

  
	
   

  	
  13.09
  Governing Law.

  	
  66

  
	
   

  	
  13.10
  No Adverse Interpretation of Other Agreements.

  	
  66

  
	
   

  	
  13.11 Successors.

  	
  66

  
	
   

  	
  13.12
  Separability.

  	
  66

  
	
   

  	
  13.13 Table of
  Contents, Headings, etc.

  	
  66

  



 


	
  Exhibit A

  	
  —

  	
  Form of Global Security

  	
   

  
	
  Exhibit B-1

  	
  —

  	
  Form of Private Placement Legend

  	
   

  
	
  Exhibit B-2

  	
  —

  	
  Form of Legend for Global Security

  	
   

  
	
  Exhibit C

  	
  —

  	
  Form of Notice of Transfer Pursuant to
  Registration Statement

  	
   

  
	
  Exhibit D

  	
  —

  	
  Form of Opinion of Counsel in Connection with
  Registration of Securities

  	
   

  



 


 


-iv-

















 


INDENTURE, dated as of
July 14, 2003 between Protein Design Labs, Inc., a Delaware corporation (the “Company”),
and J.P. Morgan Trust Company, National Association, a national banking
association, as trustee (the “Trustee”).


Each
party agrees as follows for the benefit of the other parties and for the equal
and ratable benefit of the Holders of the Company’s 2.75% Convertible
Subordinated Notes due 2023 (the “Securities”).


I.              DEFINITIONS
AND INCORPORATION BY REFERENCE


1.01         Definitions.


“Affiliate”
means any person directly or indirectly controlling or controlled by or under
direct or indirect common control with the Company.  For this purpose, “control” shall mean the power to direct the
management and policies of a person through the ownership of securities, by contract
or otherwise.


“Agent”
means any Registrar, Paying Agent, Conversion Agent or co-registrar or other
co-agent.


“Board of
Directors” means the Board of Directors of the Company or any
committee thereof authorized to act for it hereunder.


“Board
Resolution” means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Company to have been duly adopted by the Board
of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.


“Capital
Stock” means any and all shares, interests, participations or other
equivalents (however designated) of capital stock of the Company and all
warrants or options to acquire such capital stock.


“Closing Sale
Price” means the price of a share of Common Stock on the relevant
date, determined (a) on the basis of the closing per share sale price (or if no
closing sale price is reported, the average of the bid and ask prices or, if
more than one in either case, the average of the average bid and the average
ask prices) on such date on the principal national securities exchange on which
the Common Stock is listed; or (b) if the Common Stock is not listed on a
national securities exchange, as reported by the National Association of
Securities Dealers Automated Quotation System; or (c) if not so quoted, as
reported by National Quotation Bureau, Incorporated or a similar
organization.  In the absence of a
quotation, the Closing Sale Price shall be such price as the Company shall
reasonably determine on the basis of such quotations as most accurately
reflecting the price that a fully informed buyer, acting on his own accord,
would pay to a fully informed seller, acting on his own accord in an
arms-length transaction, for a share of such Common Stock.


“Common Stock”
means the common stock, par value $.01 per share, of the Company, or such other
Capital Stock into which the Company’s common stock is reclassified or changed.


 


-1-

















 


“Company”
means the party named as such above until a successor replaces it pursuant to
the applicable provision hereof and thereafter means the successor.


“Company
Request” or “Company Order” means a written request or
order signed on behalf of the Company by its Chairman of the Board, its Chief
Executive Officer, its President, its Chief Operating Officer, its Chief
Financial Officer, any Executive Vice President or any Vice President and by
its Treasurer or an Assistant Treasurer or its Secretary or an Assistant
Secretary, and delivered to the Trustee.


“Control
Agreement” means that certain Control Agreement, dated as of the
date hereof, by and among the Company, the Trustee and JPMorgan Chase Bank, a
New York banking corporation, as such agreement may be amended, restated,
supplemented or otherwise modified from time to time.


“Conversion
Rate”  means the number of shares of Common Stock
issuable upon conversion of a Security per $1,000 of Principal Amount at
Maturity, which Conversion Rate shall initially be 49.6618 shares of Common Stock
per $1,000 Principal Amount at Maturity.


“Conversion
Price”  means, as of any date of determination, the dollar amount
derived by dividing $1,000 of Principal Amount at Maturity by the Conversion
Rate then in effect.


“Corporate
Trust Office of the Trustee” shall be at the address of the Trustee
specified in Section 13.02 or such other address as the Trustee may
give notice of to the Company.


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


“Depositary”
means The Depository Trust Company, its nominees and successors.


“Exchange Act”
means the Securities Exchange Act of 1934, as amended.


“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.


“Initial
Purchasers” means UBS Securities LLC, Morgan Stanley & Co.
Incorporated and CIBC World Markets Corp.


“Interest”
includes liquidated damages, unless the context otherwise requires.


“Issue Date”
means July 14, 2003.


“Lien,”
with respect to any asset, means any mortgage, lien, pledge, charge, security
interest or encumbrance of any kind in respect of such asset given to secure
Indebtedness, whether or not filed, recorded or otherwise perfected under
applicable law (including any conditional sale or other title retention
agreement, any lease in the nature thereof, any option or other agreement to
sell, give or grant a security interest and any filing of, or agreement to
give, 


 


-2-

















 


any financing statement under the Uniform Commercial Code (or
equivalent statutes) of any jurisdiction with respect to any such lien, pledge,
charge or security interest).


“liquidated
damages” has the meaning ascribed to it in the Registration Rights
Agreement.


“Maturity
Date” means August 16, 2023.


“Officer”
means the Chairman of the Board, the Chief Executive Officer, the President,
the Chief Operating Officer, the Chief Financial Officer, any Executive Vice
President, any Vice President, the Treasurer or the Secretary of the Company.


“Officers’
Certificate” means a certificate signed by two (2) Officers or by an
Officer and an Assistant Treasurer or an Assistant Secretary of the Company.


“Opinion of Counsel”
means a written opinion from legal counsel who may be an employee of or counsel
for the Company, or other counsel reasonably acceptable to the Trustee.


“Option”  means
the Initial Purchasers’ option to acquire up to $50,000,000 of additional
Securities (“Additional Securities”) as provided for in the Purchase
Agreement.


“Permitted
Payments” means any payments on the Securities that are directly or
indirectly derived from the Pledged Financial Assets in accordance with the
terms and provisions of the Pledge Agreement and this Indenture.


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


“Pledge
Account” has the meaning ascribed to it in the Pledge Agreement.


“Pledge
Agreement” means that certain Pledge Agreement, dated as of the date
hereof, by and between the Company and Trustee, relating to, among other
things, the establishment and maintenance of the Pledge Account and the
disbursement of funds or other assets therefrom, as such agreement may be
amended, restated, supplemented or otherwise modified from time to time.


“Pledged
Security Entitlements” has the meaning ascribed to it in the Pledge
Agreement.


“Principal
Amount at Maturity”  of a Security means the principal amount
at maturity as set forth on the face of the Security.


“Purchase
Agreement” means the Purchase Agreement dated as of July 9, 2003
between the Company and the Initial Purchasers.


“Purchase
Notice” means a Purchase Notice in the form set forth in the
Securities.


 


-3-

















 


“QIB”
means a “qualified institutional buyer” within the meaning of Rule 144A under
the Securities Act.


“Redemption
Date” means the date specified for redemption of the Securities in
accordance with the terms of the Securities and this Indenture.


“Redemption
Price” means, with respect to a Security to be redeemed by the
Company in accordance with Article III, one hundred percent
(100%) of the outstanding principal amount of such Security to be redeemed.


“Registration
Rights Agreement” means the Registration Rights Agreement dated as
of the date hereof between the Company and the Initial Purchasers.


“Repurchase
Price” means, with respect to a Security duly tendered for purchase
by the Company in accordance with Section 3.09, one hundred percent
(100%) of the outstanding principal amount of such Security so tendered.


“Responsible
Officer” shall mean, when used with respect to the Trustee, any
officer within the corporate trust department of the Trustee, including any
vice president, assistant vice president, assistant secretary, assistant
treasurer, trust officer or any other officer of the Trustee who customarily
performs functions similar to those performed by the Persons who at the time
shall be such officers, respectively, or to whom any corporate trust matter is
referred because of such person’s knowledge of and familiarity with the particular
subject and who shall have direct responsibility for the administration of this
Indenture.


“Restricted
Security” means a Security that constitutes a “restricted security”
within the meaning of Rule 144(a)(3) under the Securities Act; provided,
however,
that the Trustee shall be entitled to request and conclusively rely on an
Opinion of Counsel with respect to whether any Security constitutes a
Restricted Security.


“Rule 144A”  means
Rule 144A under the Securities Act.


“SEC”
means the Securities and Exchange Commission.


“Securities”
means the 2.75% Convertible Subordinated Notes due 2023 issued by the Company
pursuant to this Indenture.


“Securities
Act” means the Securities Act of 1933, as amended.


“Significant
Subsidiary” with respect to any person means any subsidiary of such
person that constitutes a “significant subsidiary” within the meaning of Rule
1-02 of Regulation S-X under the Securities Act, as such regulation is in
effect on the date of this Indenture.


“Subsidiary”
means (i) a corporation a majority of whose capital stock with voting
power, under ordinary circumstances, to elect directors is at the time,
directly or indirectly, owned by the Company, by one or more subsidiaries of
the Company or by the Company and one or more of its subsidiaries or
(ii) any other person (other than a corporation) in which the 


 


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Company, one or more its subsidiaries or the Company and one or more
its subsidiaries, directly or indirectly, at the date of determination thereof,
have at least majority ownership interest.


“TIA”
means the Trust Indenture Act of 1939 (15 U.S. Code §§ 77aaa-77bbbb) 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
principal national or regional securities exchange on which the Common Stock is
then listed or, if the Common Stock is not listed on a national or regional
securities exchange, on the National Association of Securities Dealers
Automated Quotation System or, if the Common Stock is not quoted on the
National Association of Securities Dealers Automated Quotation System, on the
principal other market on which the Common Stock is then traded.


“Trustee”
means the party named as such in this Indenture until a successor replaces it
in accordance with the provisions hereof and thereafter means the successor.


“Voting Stock”
means the total voting power of all classes of the Company’s Capital Stock
entitled to vote generally in the election of directors.


1.02         Other Definitions.


	
  Term

  	
   

  	
  Defined in Section

  
	
  “Additional Securities”

  	
   

  	
  1.01

  
	
  “Aggregate Amount”

  	
   

  	
  10.06

  
	
  “Bankruptcy Law”

  	
   

  	
  6.01

  
	
  “Business Day”

  	
   

  	
  13.07

  
	
  “Change in Control”

  	
   

  	
  3.09

  
	
  “Conversion Agent”

  	
   

  	
  2.03

  
	
  “Conversion Shares”

  	
   

  	
  10.06

  
	
  “Custodian”

  	
   

  	
  6.01

  
	
  “Designated Senior Indebtedness”

  	
   

  	
  11.02

  
	
  “Determination Date”

  	
   

  	
  10.06

  
	
  “Distribution Date”

  	
   

  	
  10.06

  
	
  “Event of Default”

  	
   

  	
  6.01

  
	
  “Expiration Date”

  	
   

  	
  10.06

  
	
  “Expiration Time”

  	
   

  	
  10.06

  
	
  “Global Security”

  	
   

  	
  2.01

  
	
  “Indebtedness”

  	
   

  	
  11.02

  
	
  “Legal Holiday”

  	
   

  	
  13.07

  
	
  “Market Price”

  	
   

  	
  3.08

  
	
  “Non-Payment Default”

  	
   

  	
  11.04

  
	
  “Notice of Default”

  	
   

  	
  6.01

  
	
  “Option Purchase Date”

  	
   

  	
  3.08

  
	
  “Option Purchase Notice”

  	
   

  	
  3.08

  
	
  “Option Purchase Price”

  	
   

  	
  3.08

  
	
  “Participants”

  	
   

  	
  2.15

  



 


-5-

















 


	
  “Paying Agent”

  	
   

  	
  2.03

  
	
  “Payment Blockage Period”

  	
   

  	
  11.04

  
	
  “Payment Blockage Notice”

  	
   

  	
  11.04

  
	
  “Payment Default”

  	
   

  	
  11.04

  
	
  “Physical Securities”

  	
   

  	
  2.01

  
	
  “Private Placement Legend”

  	
   

  	
  2.17

  
	
  “Purchased Shares”

  	
   

  	
  10.06

  
	
  “Qualifying Foreign Merger”

  	
   

  	
  5.01

  
	
  “Redemption”

  	
   

  	
  3.01

  
	
  “Registrar”

  	
   

  	
  2.03

  
	
  “Release Amount”

  	
   

  	
  12.04

  
	
  “Release Distribution”

  	
   

  	
  12.04

  
	
  “Remaining Securities”

  	
   

  	
  12.04

  
	
  “Representative”

  	
   

  	
  11.02

  
	
  “Repurchase at Holder’s Option”

  	
   

  	
  3.01

  
	
  “Repurchase Date”

  	
   

  	
  3.09

  
	
  “Repurchase Event”

  	
   

  	
  3.09

  
	
  “Repurchase Event Notice”

  	
   

  	
  3.09

  
	
  “Repurchase Right”

  	
   

  	
  3.09

  
	
  “Repurchase Upon Repurchase Event”

  	
   

  	
  3.01

  
	
  “Resale Restriction Termination Date”

  	
   

  	
  2.17

  
	
  “Rights”

  	
   

  	
  10.06

  
	
  “Senior Indebtedness”

  	
   

  	
  11.02

  
	
  “Termination of Trading”

  	
   

  	
  3.09

  
	
   

  	
   

  	
   

  



 


1.03         Incorporation by Reference of Trust Indenture
Act.


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 or a Holder;


“indenture to
be qualified” means this Indenture;


“indenture
trustee” or “institutional trustee” means the Trustee;
and


“obligor”
on the indenture securities means the Company or any successor.


All
other terms used in this Indenture that are defined by the TIA, defined by TIA
reference to another statute or defined by SEC rule under the TIA and not
otherwise defined herein have the meanings so assigned to them.


 


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1.04         Rules of Construction.


Unless
the context otherwise requires:


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


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


(iii)       “or” is not exclusive;


(iv)       words in the singular include the plural
and in the plural include the singular;


(v)        provisions apply to successive events
and transactions; and


(vi)       “herein”, “hereof” and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.


II.            THE
SECURITIES


2.01         Form and Dating.


The
Securities and the Trustee’s certificate of authentication shall be
substantially in the form set forth in Exhibit A, which is incorporated in and
forms a part of this Indenture.  The Securities
may have notations, legends or endorsements required by law, stock exchange
rule or usage.  Each Security shall be
dated the date of its authentication.


Securities
offered and sold in reliance on Rule 144A under the Securities Act shall
be issued initially in the form of one or more Global Securities, substantially
in the form set forth in Exhibit A (the “Global Security”), deposited
with the Trustee, as custodian for the Depositary, duly executed by the Company
and authenticated by the Trustee as hereinafter provided and bearing the legends
set forth in Exhibits B-1 and B-2. 
The aggregate principal amount of the Global Security may from time to
time be increased or decreased by adjustments made on the records of the
Trustee, as custodian for the Depositary, as hereinafter provided; provided,
that in no event shall the aggregate principal amount of the Global Security or
Securities exceed $250,000,000 (or $300,000,000 if the Initial Purchasers elect
to purchase Additional Securities pursuant to the Option).


Securities
issued in exchange for interests in a Global Security pursuant to Section 2.15
may be issued in the form of permanent certificated Securities in
registered form in substantially the form set forth in Exhibit A (the “Physical
Securities”) and, if applicable, bearing any legends required by Section 2.17.


2.02         Execution and Authentication.


One
Officer shall sign the Securities for the Company by manual or facsimile signature.


 


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If
an Officer whose signature is on a Security no longer holds that office at the
time the Security is authenticated, the Security shall nevertheless be valid.


A
Security shall not be valid until authenticated by the manual signature of the
Trustee.  The signature shall be
conclusive evidence that the Security has been authenticated under this
Indenture.


Upon
a written order of the Company signed by one Officer, the Trustee shall
authenticate Securities for original issue in the aggregate principal amount of
$250,000,000 and such additional principal amount, if any, as shall be
determined pursuant to the next sentence of this Section 2.02.  Upon receipt by the Trustee of an Officers’
Certificate stating that the Initial Purchasers have elected to purchase from
the Company a specified principal amount of Additional Securities, not to
exceed $50,000,000, pursuant to the Purchase Agreement, the Trustee shall
authenticate and deliver such specified principal amount of Additional
Securities to or upon the written order of the Company signed as provided in
the immediately preceding sentence. 
Such Officers’ Certificate must be received by the Trustee not later
than the proposed date for delivering of such Additional Securities.  The aggregate principal amount of Securities
outstanding at any time may not exceed $300,000,000.


Upon
a written order of the Company signed by two (2) Officers or by an Officer and
an Assistant Treasurer of the Company, the Trustee shall authenticate
Securities not bearing the Private Placement Legend to be issued to the
transferee when sold pursuant to an effective registration statement under the
Securities Act as set forth in Section 2.16(B).


The
Trustee shall act as the initial authenticating agent.  Thereafter, the Trustee may appoint an
authenticating agent acceptable to the Company to authenticate Securities.  An authenticating agent may authenticate
Securities whenever the Trustee may do so. 
Each reference in this Indenture to authentication by the Trustee
includes authentication by such Agent. 
An authenticating agent has the same rights as an Agent to deal with the
Company and its Affiliates.


If
a written order of the Company pursuant to this Section 2.02 has been, or
simultaneously is, delivered, any instructions by the Company to the Trustee
with respect to endorsement, delivery or redelivery of a Security issued in
global form shall be in writing but need not comply with Section 13.04 hereof and need
not be accompanied by an Opinion of Counsel.


The
Securities shall be issuable only in registered form without interest coupons
and only in denominations of $1,000 principal amount and any integral multiple
thereof.


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 payment (“Paying Agent”) and an office
or agency where Securities may be presented for conversion (“Conversion
Agent”).  The Registrar shall
keep a register of the Securities and of their transfer and exchange.  The Company may appoint or change one or
more co-registrars, one or more additional paying agents and one or more
additional conversion agents 


 


-8-

















 


without notice and may act in any such capacity on its own behalf.  The term “Registrar” includes any
co-registrar; the term “Paying Agent” includes any additional
paying agent; and the term “Conversion Agent” includes any additional
conversion agent.


The
Company shall enter into an appropriate agency agreement with any Agent not a
party to this Indenture.  The agreement
shall implement the provisions of this Indenture that relate to such
Agent.  The Company shall notify the
Trustee of the name and address of any Agent not a party to this
Indenture.  If the Company fails to
maintain a Registrar, Paying Agent or Conversion Agent, the Trustee shall act
as such.


The
Company initially appoints the Trustee as Paying Agent, Registrar and Conversion
Agent.


2.04         Paying Agent To Hold Money in Trust.


Each
Paying Agent shall hold in trust for the benefit of the Securityholders or the
Trustee all moneys held by the Paying Agent for the payment of the Securities,
and shall notify the Trustee of any default by the Company in making any such
payment.  While any such default
continues, the Trustee may require a Paying Agent to pay all money held by it
to the Trustee.  The Company at any time
may require a Paying Agent to pay all money held by it to the Trustee.  Upon payment over to the Trustee, the Paying
Agent shall have no further liability for the money.  If the Company acts as Paying Agent, it shall segregate and hold
as a separate trust fund all money held by it as Paying Agent.


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 furnish to the Trustee on or before each
interest payment date 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.


2.06         Transfer and Exchange.


Subject
to Sections
2.15 and 2.16 hereof, where Securities are presented
to the Registrar with a request to register their transfer or to exchange them
for an equal principal amount of Securities of other authorized denominations,
the Registrar shall register the transfer or make the exchange if its
requirements for such transaction are met. 
To permit registrations of transfer and exchanges, the Trustee shall
authenticate Securities at the Registrar’s request.  The Company or the Trustee, as the case may be, shall not be
required (a) to issue, authenticate, register the transfer of or exchange any
Security during a period beginning at the opening of business fifteen (15) days
before the mailing of a notice of redemption of the Securities selected for
redemption under Section 3.04 and ending at the close of business on
the day of such mailing or (b) to register the transfer of or exchange any
Security that has been selected for redemption or for which a Purchase Notice
has been delivered, and not withdrawn, in accordance with this Indenture,
except the unredeemed or unrepurchased portion of Securities being redeemed or
repurchased in part.


 


-9-

















 


No
service charge shall be made for any transfer, exchange or conversion of
Securities, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection with any
transfer, exchange or conversion of Securities, other than exchanges pursuant
to Sections 2.10, 3.07,
3.08, 3.09, 9.05 or 10.02 not involving any transfer.


2.07         Replacement Securities.


If
the Holder of a Security claims that the Security has been mutilated, lost,
destroyed or wrongfully taken, the Company shall issue and the Trustee shall
authenticate a replacement Security upon surrender to the Trustee of the
mutilated Security, or upon delivery to the Trustee of evidence of the loss,
destruction or theft of the Security satisfactory to the Trustee and the
Company.  In the case of lost, destroyed
or wrongfully taken Securities, if required by the Trustee, an indemnity bond
must be provided by the Holder that is sufficient in the judgment of the
Trustee and the Company to protect the Company, the Trustee or any Agent from
any loss which any of them may suffer if a Security is replaced.  The Trustee may charge for its expenses in
replacing a Security.


In
case any such mutilated, lost, destroyed or wrongfully taken Security has
become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security when due.


Every
replacement Security is an additional obligation of the Company only as
provided in Section 2.08.


2.08         Outstanding Securities.


Securities
outstanding at any time are all the Securities authenticated by the Trustee
except for those converted, those cancelled by it, those delivered to it for
cancellation and those described in this Section 2.08 as not outstanding.  Except to the extent provided in Section 2.09,
a Security does not cease to be outstanding because the Company or one of the
Subsidiaries or Affiliates holds the Security.


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


If
the Paying Agent (other than the Company) holds, on an Option Purchase Date,
money and/or shares of Common Stock, if applicable and as herein provided, or
holds, on the Redemption Date, Repurchase Date or Maturity Date, money,
sufficient to pay, as herein provided, the Option Purchase Price, the
Redemption Price, the Repurchase Price or the principal amount, as the case may
be, plus, if applicable, accrued and unpaid interest, if any, payable as herein
provided in respect of Securities upon Repurchase at Holder’s Option,
Redemption, Repurchase Upon Repurchase Event or maturity, then immediately
after such date such Securities shall be deemed to be no longer outstanding,
and interest on them shall cease to accrue, and such Securities shall be deemed
paid whether or not such Securities are delivered to the Paying Agent.  Thereafter, all other rights of the Holders
of such Securities shall terminate with respect to such Securities, other than
the right to receive the Option Purchase Price, the 


 


-10-

















 


Redemption Price, the Repurchase Price or the principal amount, as the
case may be, plus, if applicable, such accrued and unpaid interest.


If
a Security is converted in accordance with Article X, then, from and after the time of
such conversion on the conversion date, such Security shall cease to be
outstanding, and interest, if any, shall cease to accrue on such Security.


2.09         Securities Held by the Company or an
Affiliate.


In
determining whether the Holders of the required aggregate principal amount of
Securities have concurred in any direction, waiver or consent, Securities owned
by the Company or any of the Subsidiaries or an Affiliate shall be considered
as though not outstanding, except that for the purposes of determining whether
a Responsible Officer of the Trustee shall be protected in relying on any such
direction, waiver or consent, only Securities which the Trustee knows are so
owned shall be so disregarded.


2.10         Temporary Securities.


Until
definitive Securities are ready for delivery, the Company may prepare and the
Trustee shall authenticate temporary Securities.  Temporary Securities shall be substantially in the form of
definitive Securities but may have variations that the Company considers
appropriate for temporary Securities. 
Without unreasonable delay, the Company shall prepare and the Trustee
shall authenticate definitive Securities in exchange for temporary Securities.


2.11         Cancellation.


The
Company at any time may deliver Securities to the Trustee for
cancellation.  The Registrar, Paying
Agent and Conversion Agent shall forward to the Trustee any Securities surrendered
to them for transfer, exchange, payment or conversion.  The Trustee shall cancel all Securities
surrendered for transfer, exchange, payment, conversion or cancellation in
accordance with its customary procedures. 
The Company may not issue new Securities to replace Securities that it
has paid or delivered to the Trustee for cancellation or that any
Securityholder has converted pursuant to Article X.


2.12         Defaulted Interest.


If
and to the extent the Company defaults in a payment of interest on the
Securities, the Company shall pay the defaulted interest in any lawful manner
plus, to the extent not prohibited by applicable statute or case law, interest
payable on the defaulted interest at the rate provided in the Securities.  The Company may pay the defaulted interest
to the persons who are Securityholders on a subsequent special record
date.  The Company shall fix such record
date and payment date.  At least fifteen
(15) days before the record date, the Company shall mail to Securityholders a
notice that states the record date, payment date and amount of interest to be
paid.


 


-11-

















 


2.13         CUSIP
Numbers.


The
Company in issuing the Securities may use one or more “CUSIP” numbers, and if
so, the Trustee shall use the CUSIP numbers in notices of redemption or
exchange as a convenience to Holders; provided, however, that no
representation is hereby deemed to be made by the Trustee as to the correctness
or accuracy of the CUSIP numbers printed in the notice or on the Securities,
and that reliance may be placed only on the other identification numbers
printed on the Securities.  The Company
shall promptly notify the Trustee of any change in the CUSIP numbers.


2.14         Deposit of Moneys.


Prior
to 11:00 A.M., New York City time, on each interest payment date, Maturity
Date, Redemption Date, Option Purchase Date or Repurchase Date, the Company
shall have deposited with the Paying Agent in immediately available funds money
sufficient to make cash payments, if any, due on such interest payment date,
Maturity Date, Redemption Date, Option Purchase Date or Repurchase Date, as the
case may be, in a timely manner which permits the Paying Agent to remit payment
to the Holders on such interest payment date, Maturity Date, Redemption Date,
Option Purchase Date or Repurchase Date, as the case may be; provided,
however,
that, with respect to a Repurchase at Holder’s Option where all or a portion of
the Option Purchase Price is to be paid in shares of Common Stock as provided
in, and in compliance with, Section 3.08, the Company shall similarly
deposit with the Paying Agent the amount of shares of Common Stock payable
under Section
3.08 in respect of such Option Purchase Price.


2.15         Book-Entry Provisions for Global
Securities.


(A)          The Global Securities initially shall
(i) be registered in the name of the Depositary or the nominee of such
Depositary, (ii) be delivered to the Trustee as custodian for such
Depositary and (iii) bear legends as set forth in Section 2.17.


Members
of, or participants in, the Depositary (“Participants”) shall have no rights under
this Indenture with respect to any Global Security held on their behalf by the
Depositary, or the Trustee as its custodian, or under the Global Security, and
the Depositary may be treated by the Company, the Trustee and any agent of the
Company or the Trustee as the absolute owner of the Global Security for all
purposes whatsoever.  Notwithstanding
the foregoing, nothing herein shall prevent the Company, the Trustee or any
agent of the Company or the Trustee from giving effect to any written
certification, proxy or other authorization furnished by the Depositary or
impair, as between the Depositary and Participants, the operation of customary
practices governing the exercise of the rights of a Holder of any Security.


(B)           Transfers of Global Securities shall
be limited to transfers in whole, but not in part, to the Depositary, its
successors or their respective nominees. 
In addition, Physical Securities shall be transferred to all beneficial
owners, as identified by the Depositary, in exchange for their beneficial
interests in Global Securities only if (i) the Depositary notifies the
Company that it is unwilling or unable to continue as depositary for any Global
Security and a successor Depositary is not appointed by the Company within
ninety (90) days of such notice or 


 


-12-

















 


(ii) an Event
of Default has occurred and is continuing and the Registrar has received a
written request from the Depositary to issue Physical Securities.


(C)           In connection with the transfer of a
Global Security in its entirety to beneficial owners pursuant to Section 2.15(B),
such Global Security shall be deemed to be surrendered to the Trustee for
cancellation, and the Company shall execute, and the Trustee shall upon written
instructions from the Company authenticate and deliver, to each beneficial
owner identified by the Depositary in exchange for its beneficial interest in
such Global Security, an equal aggregate principal amount of Physical
Securities of authorized denominations.


(D)          Any Physical Security constituting a
Restricted Security delivered in exchange for an interest in a Global Security
pursuant to Section 2.15(B) shall, except as otherwise provided by Section 2.16,
bear the Private Placement Legend.


(E)           The Holder of any Global Security may
grant proxies and otherwise authorize any Person, including Participants and
Persons that may hold interests through Participants, to take any action which
a Holder is entitled to take under this Indenture or the Securities.


2.16         Special Transfer Provisions.


(A)          Restrictions on Transfer and Exchange of Global
Securities.  Notwithstanding
any other provisions of this Indenture, a Global Security may not be
transferred except as a whole by the Depositary to a nominee of the Depositary
or by a nominee of the Depositary to the Depositary or another nominee of the
Depositary or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary.


(B)           Private Placement Legend.  Upon the transfer, exchange or replacement
of Securities not bearing the Private Placement Legend, the Registrar or
co-Registrar shall deliver Securities that do not bear the Private Placement
Legend.  Upon the transfer, exchange or
replacement of Securities bearing the Private Placement Legend, the Registrar
or co-Registrar shall deliver only Securities that bear the Private Placement
Legend unless (i) the requested transfer is after the Resale Restriction
Termination Date, (ii) there is delivered to the Trustee an Opinion of
Counsel reasonably satisfactory to the Company to the effect that neither such
legend nor the related restrictions on transfer are required in order to
maintain compliance with the provisions of the Securities Act or
(iii) such Security has been sold pursuant to an effective registration
statement under the Securities Act and the Holder selling such Securities has
delivered to the Registrar or co-Registrar a notice in the form of Exhibit C
hereto.  Upon the effectiveness of the
Shelf Registration Statement (as defined in the Registration Rights Agreement),
the Company shall deliver to the Trustee a notice of effectiveness, a Security
or Securities, an authentication order in accordance with Section 2.02 and an
opinion of counsel in the form of Exhibit D hereto and, if required by
the Depositary, the Company shall deliver to the Depositary a letter of
representations in a form reasonably acceptable to the Depositary.


(C)           General. 
By its acceptance of any Security bearing the Private Placement Legend,
each Holder of such a Security acknowledges the restrictions on transfer of
such Security set forth in this Indenture and in the Private Placement Legend
and agrees that it will transfer such Security only as provided in this
Indenture.


 


-13-

















 


The
Registrar shall retain copies of all letters, notices and other written
communications received pursuant to Section 2.15 or this Section 2.16.  The Company shall have the right to inspect
and make copies of all such letters, notices or other written communications at
any reasonable time upon the giving of reasonable written notice to the
Registrar.


(D)          Transfers of Securities Held by Affiliates.  Any certificate (i) evidencing a Security
that has been transferred to an Affiliate within two (2) years after the Issue
Date, as evidenced by a notation on the assignment form for such transfer or in
the representation letter delivered in respect thereof or (ii) evidencing
a Security that has been acquired from an Affiliate (other than by an
Affiliate) in a transaction or a chain of transactions not involving any public
offering, shall, until two (2) years after the last date on which the Company
or any Affiliate was an owner of such Security (or such longer period of time
as may be required under the Securities Act or applicable state securities
laws, as set forth in an Opinion of Counsel), in each case, bear the Private
Placement Legend, unless otherwise agreed by the Company (with written notice
thereof to the Trustee).


2.17         Restrictive Legends.


Each
Global Security and Physical Security that constitutes a Restricted Security
shall bear the legend (the “Private Placement Legend”) as set forth in Exhibit B-1
on the face thereof until after the second anniversary of the later
of (i) the Issue Date and (ii) the last date on which the Company or any
Affiliate was the owner of such Security (or any predecessor security) (or such
shorter period of time as permitted by Rule 144(k) under the Securities Act or
any successor provision thereunder) (or such longer period of time as may be
required under the Securities Act or applicable state securities laws, as set
forth in an Opinion of Counsel, unless otherwise agreed between the Company and
the Holder thereof) (such date, the “Resale Restriction Termination Date”).


Each
Global Security shall also bear the legend as set forth in Exhibit B-2.


III.           REDEMPTION


3.01         Right of Redemption.


Redemption
of the Securities, as permitted by any provision of this Indenture, shall be
made in accordance with paragraphs 6  and 7 (a “Redemption”),
with respect to a repurchase at the Holder’s option, paragraph 8 (a “Repurchase
at Holder’s Option”), and with respect to any repurchase upon a
Repurchase Event, paragraph 9 (a “Repurchase Upon Repurchase Event”)
of the Securities, in each case in accordance with the applicable provisions of
this Article
III.


The
Company will comply with all federal and state securities laws in connection
with any offer to sell or solicitations of offers to buy Securities pursuant to
this Section
3.01.


Prior
to August 16, 2008, the Company will not have the right to redeem any
Securities.  On or after August 16,
2008, the Company will have the right to redeem all or any part of the 


 


-14-

















 


Securities at the Redemption Price plus accrued and unpaid interest, if
any, to, but excluding, the Redemption Date.


3.02         Notices to Trustee.


If
the Company elects to redeem Securities pursuant to paragraph 6 of the
Securities, it shall notify the Trustee at least fifteen (15) days prior to the
mailing of the notice of Redemption (unless a shorter notice period shall be
satisfactory to the Trustee) of the Redemption Date and the aggregate principal
amount of Securities to be redeemed.


3.03         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 by lot, on a pro rata basis or in accordance with any
other method the Trustee considers fair and appropriate.  The Trustee shall make the selection from
Securities outstanding not previously called for Redemption.  The Trustee may select for Redemption
portions of the principal of Securities that have denominations larger than
$1,000 principal amount.  Securities and
portions of them the Trustee selects shall be in amounts of $1,000 principal
amount or integral multiples of $1,000 principal amount.  The Trustee shall promptly notify the
Company in writing of the Securities selected for Redemption and the principal
amount thereof to be redeemed.


The
Registrar need not transfer or exchange any Securities selected for Redemption,
except the unredeemed portion of the Securities redeemed in part.  Also, the Registrar need not transfer or
exchange any Securities for a period of fifteen (15) days before selecting
Securities to be redeemed.


3.04         Notice of Redemption.


At
least thirty (30) days but not more than sixty (60) days before a Redemption
Date, the Company shall mail by first-class mail, overnight delivery or
telecopy a notice of Redemption to each Holder whose Securities are to be redeemed,
at the address of such Holder appearing in the security register.


The
notice shall identify the Securities and the aggregate principal amount thereof
to be redeemed and shall state:


(i)         the Redemption Date;


(ii)        the Redemption Price plus accrued and
unpaid interest, if any, to, but excluding, the Redemption Date;


(iii)       the Conversion Rate and the Conversion
Price;


(iv)       the names and addresses of the Paying Agent
and the Conversion Agent;


 


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(v)        the date on which the right to convert
the principal of the Securities called for Redemption will terminate and the
place or places where such Securities may be surrendered for conversion;


(vi)       that Holders who want to convert
Securities must satisfy the requirements in Article X;


(vii)      the paragraph of the Securities pursuant
to which the Securities are to be redeemed;


(viii)     that Securities called for Redemption must
be surrendered to the Paying Agent to collect the Redemption Price plus accrued
and unpaid interest, if any, payable as herein provided upon Redemption;


(ix)       that unless the Company shall default in
the payment of the Redemption Price, or accrued and unpaid interest, if any,
payable as herein provided upon Redemption, interest on Securities called for
Redemption ceases to accrue on and after the Redemption Date and that the
Securities will cease to be convertible after the close of business on the Business
Day immediately preceding the Redemption Date; and


(x)        the CUSIP number or numbers, as the case
may be, of the Securities.


The
date on which the right to convert the principal of the Securities called for
Redemption will terminate shall be at the close of business on the Business Day
immediately preceding the Redemption Date.


At
the Company’s request, upon reasonable prior notice, the Trustee shall give the
notice of Redemption in the Company’s name and at the Company’s expense; provided
that the form and content of such notice shall be prepared by the Company.


3.05         Effect of Notice of Redemption.


Once
notice of Redemption is mailed, Securities called for Redemption become due and
payable on the Redemption Date at the Redemption Price plus accrued and unpaid
interest to, but excluding, the Redemption Date, and, on and after such
Redemption Date (unless the Company shall default in the payment of the Redemption
Price or such accrued and unpaid interest), such Securities shall cease to bear
interest.  Upon surrender to the Paying
Agent, such Securities shall be paid at the Redemption Price plus accrued
interest to, but excluding, the Redemption Date, unless the Redemption Date is
an interest payment date, in which case the accrued interest will be paid in the
ordinary course.


3.06         Deposit of Redemption Price.


On
or before the Redemption Date, the Company shall deposit with the Paying Agent
money in funds immediately available on the Redemption Date sufficient to pay
the Redemption Price, plus accrued and unpaid interest to, but excluding, the
Redemption Date, of all Securities to be redeemed on that date.  The Paying Agent shall return to the
Company, as soon as practicable, any money not required for that purpose.


 


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3.07         Securities Redeemed in Part.


Upon
surrender of a Security that is redeemed in part, the Company shall execute and
the Trustee shall authenticate for the Holder a new Security or Securities in
an aggregate principal amount equal to the unredeemed portion of the Security
surrendered.


If
any Security selected for partial Redemption is converted in part, the
converted portion of such Security shall be deemed to be the portion selected
for Redemption.


3.08         Purchase of Securities at Option of the
Holder.


(A)          At the option of the Holder thereof,
Securities shall be purchased by the Company pursuant to paragraph 8 of the Securities
on August 16, 2010, August 16, 2013 and August 16, 2018 (each, an “Option
Purchase Date”), at one hundred percent (100%) of the principal
amount of the Securities (the “Option Purchase Price”), plus accrued and
unpaid interest, if any, to, but excluding, the Option Purchase Date, upon:


(i)            delivery to the
Paying Agent, by the Holder, of a Purchase Notice, in the form set forth in the
Securities, or any other form of written notice substantially similar thereto,
at any time from the opening of business on the date that is twenty (20)
Business Days prior to the applicable Option Purchase Date until the close of
business on the Business Day immediately preceding the applicable Option
Purchase Date, stating:


(I)            the certificate
number of the Securities which the Holder will deliver to be purchased;


(II)           the principal
amount of Securities to be purchased, which must be $1,000 or an integral
multiple thereof;


(III)          that such Principal
amount of Securities shall be purchased as of the applicable Option Purchase
Date pursuant to the terms and conditions specified in paragraph 8 of the Securities
and in this Indenture; and


(IV)          if the applicable
Option Purchase Date is August 16, 2013 or August 16, 2018, whether, in the
event the Company shall elect, pursuant to Section 3.08(C), to pay the Option Purchase
Price, in whole or in part, in shares of Common Stock, and such portion of the
Option Purchase Price shall ultimately be paid to such Holder entirely in cash
because any of the conditions, as provided in this Section 3.08, to payment of
the Option Purchase Price in shares of Common Stock is not satisfied prior to
the close of business on the Business Day immediately preceding the applicable
Option Purchase Date, such Holder elects (i) to withdraw such Purchase Notice
as to some or all of the Securities to which such Purchase Notice relates
(stating the principal amount and certificate numbers, if any, of the
Securities to be so withdrawn, which amount must be $1,000 or an integral
multiple thereof) or (ii) to receive cash in respect of the entire Option
Purchase Price for the Securities (or portions thereof) to which such Purchase
Notice relates; and


 


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(ii)           delivery of such
Securities (together with all necessary endorsements) to the Paying Agent after
delivery of the Purchase Notice at the offices of the Paying Agent, such
delivery being a condition to receipt by the Holder of the Option Purchase
Price therefor plus accrued and unpaid interest thereon, if any, to, but
excluding, the applicable Option Purchase Date; provided, however, that such
Option Purchase Price and such accrued and unpaid interest shall be so paid
pursuant to this Section 3.08 only if the Securities so delivered to the Paying
Agent shall conform in all respects to the description thereof in the related
Purchase Notice, as determined by the Company.


Any
purchase by the Company contemplated pursuant to the provisions of this Section 3.08
shall be consummated by the delivery of the consideration to be received by the
Holder (together with accrued and unpaid interest, if any,) as promptly as
practicable following the later of the applicable Option Purchase Date and the
time of delivery of the Security, but in no event more than three (3) Business
Days following the later of the applicable Option Purchase Date or the time of
delivery of the Security.  In accordance
with the preceding sentence, if all or a portion of the Option Purchase Price
is to be paid in shares of Common Stock pursuant to and in accordance with this
Section
3.08, the Company shall deliver to each Holder entitled to receive
shares of Common Stock through the Paying Agent, a certificate for the number
of full shares of Common Stock issuable in full or partial payment of the
Option Purchase Price as herein provided and cash in lieu of any fractional
interests.  The person in whose name the
certificate for the shares of Common Stock is registered shall be treated as a
holder of record of Common Stock on the Business Day following the date of
delivery of such certificate as described in the previous sentence.  Except as otherwise provided in this Section 3.08,
no payment or adjustment will be made for dividends on the shares of Common
Stock the record date for which occurred on or prior to the applicable Option
Purchase Date.


If
a Holder, in such Holder’s Purchase Notice, fails to indicate such Holder’s
choice with respect to the election set forth in Section 3.08(A)(i)(IV),
such Holder shall be deemed to have elected to receive, in the circumstances
set forth in such Section 3.08(A)(i)(IV), cash in
respect of the entire Option Purchase Price for all Securities (or portions
thereof) subject to such Purchase Notice.


Notwithstanding
anything herein to the contrary, any Holder delivering to the Paying Agent the
Purchase Notice contemplated by this Section 3.08(A) shall have the right to
withdraw such Purchase Notice by delivery, at any time prior to the close of
business on the Business Day prior to the applicable Option Purchase Date, of a
written notice of withdrawal to the Paying Agent, which notice shall contain
the information specified in Section 3.08(E)(viii).


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


(B)           The Option Purchase Price, plus
accrued and unpaid interest, if any, payable as herein provided in respect of
Securities upon a Repurchase at Holder’s Option, shall be paid in cash if the
applicable Option Purchase Date is August 16, 2010.


(C)           Upon a Repurchase at Holder’s Option
where the applicable Option Purchase Date is August 16, 2013 or August 16,
2018, the Option Purchase Price may be paid for, in 


 


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whole or in part, at the
election of the Company, in cash or shares of Common Stock or in any
combination of cash and shares of Common Stock; provided, however,
that:


(i)      no portion of the Option
Purchase Price shall be paid in shares of Common Stock unless the conditions
set forth in Section 3.08(D) are satisfied;


(ii)     nothing in this Section
3.08
shall permit the Company to pay accrued and unpaid interest, if any, payable as
herein provided in respect of Securities upon a Repurchase at Holder’s Option
in shares of Common Stock; the Company shall pay such accrued and unpaid in
interest, if any, in cash; and


(iii)    the Company shall not
issue fractional shares of Common Stock in payment of the Option Purchase Price
and shall instead pay cash for all fractional shares, which cash shall be in an
amount equal to the Market Price of such fractional shares; for purposes of
determining the existence of potential fractional interests, all Securities
subject to such Repurchase at Holder’s Option held by a Holder shall be
considered together without regard to the number of separate certificates
representing such Securities.


Except as provided in this Section 3.08,
once the Company has given the Option Purchase Notice to Holders, the Company
shall not change its election set forth in such Option Purchase Notice pursuant
Section 3.08(E)(xi)(I)
with respect to the portion of the Option Purchase Price to be paid in cash or
shares of Common Stock.


 


Except as otherwise provided
in this Section 3.08,
each Holder whose Securities are purchased pursuant to this Section 3.08(C)
shall receive the same percentage of cash or shares of Common Stock in payment
of the Option Purchase Price for such Securities.


 


The portion of the Option
Purchase Price to be paid in shares of Common Stock, if payment in shares of
Common Stock is permitted pursuant to this Section 3.08, shall be paid by the issuance
of a number of shares of Common Stock equal to a fraction whose numerator is
such portion of the Option Purchase Price to be paid in shares of Common Stock
and whose denominator is the Market Price per share of Common Stock as
determined by the Company, except that (i) accrued and unpaid interest, if any,
payable as herein provided in respect of Securities upon a Repurchase at
Holder’s Option shall be paid in cash and (ii) fractional shares of Common
Stock shall be paid in cash as provided in Section 3.08(C)(iii).


 


All shares of Common Stock
delivered as full or partial payment of the Option Purchase Price pursuant to
this Section
3.08 shall be newly issued shares or treasury shares, shall be duly
authorized, validly issued, fully paid and nonassessable and shall be free from
preemptive rights and free of any lien or adverse claim.


 


If a Holder is paid in
shares of Common Stock as full or partial payment of the Option Purchase Price
pursuant to this Section 3.08, the Company shall pay any documentary, stamp or
similar issue or transfer tax due on such issue of Common Stock.  However, the Holder shall pay any such tax
which is due because the Holder requests the Common Stock to be issued in a
name other than the Holder’s name.  The Paying
Agent may refuse to deliver the certificates representing the shares of Common
Stock being issued in a name other than the Holder’s name 


 


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until the Paying Agent receives a sum
sufficient to pay any tax which will be due because the shares of Common Stock
are to be issued in a name other than the Holder’s name. Nothing herein shall
preclude any income tax withholding required by law or regulations.


 


“Market Price” means the
average of the Closing Sale Price for each Trading Day in the period of ten
(10) consecutive Trading Days ending on, and including, the third Business Day
prior to the applicable Option Purchase Date (if the third Business Day prior
to the applicable Option Purchase Date is not a Trading Day, then ending on,
and including, the last Trading Day prior to such third Business Day),
appropriately adjusted to take into account the occurrence, during such ten
(10) Trading Day period, of any event described in Section 10.06, subject,
however, to the provisions of Section 10.07.


 


(D)          The Company shall not be entitled to
pay any portion of the Option Purchase Price in shares of Common Stock pursuant
to Section
3.08(C) unless all of the following conditions are satisfied:


(i)      The Company shall have
specified, in the Option Purchase Notice timely given to all Holders in
accordance with Section 3.08(E), that the Company will pay all or a portion of
the Option Purchase Price in shares of Common Stock and shall have specified in
such Option Purchase Notice the percentages of the Option Purchase Price in
respect of which the Company will pay in cash or shares of Common Stock;


(ii)     At least three (3)
Business Days before an Option Purchase Notice is given to Holders pursuant to Section
3.08(E), the Company shall have delivered an Officers’ Certificate
to the Trustee specifying (I) the manner of payment selected by the Company,
(II) the information required by Section 3.08(E) to be included in the
Option Purchase Notice and (III) if the Company elects to pay all or a portion
of the Option Purchase Price in shares of Common Stock, that the conditions to
such manner of payment set forth in this Section 3.08 have been, or will be,
complied with;


(iii)    the information necessary
to calculate the Market Price is published in a daily newspaper of national
circulation;


(iv)    the shares of Common Stock
to be delivered as payment, in whole or in part, of the Option Purchase Price
shall be registered under the Securities Act;


(v)     the shares of Common Stock
to be delivered as payment, in whole or in part, of the Option Purchase Price
shall be duly qualified or registered under applicable state securities laws or
shall be qualified for an available exemption from such qualification and
registration;


(vi)    the shares of Common Stock
to be delivered as payment, in whole or in part, of the Option Purchase Price
shall be listed on a U.S. national securities exchange or qualified for
quotation on The Nasdaq National Market;


(vii)   before the close of
business on the Business Day immediately preceding the applicable Option
Purchase Date, the Trustee shall have received an Officers’ Certificate
stating:


 


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(I)            that the conditions
in clauses (i), (iii), (iv), (v) and (vi) above have been satisfied; and


(II)           the number of
shares of Common Stock to be issued for each $1,000 principal amount of
Securities and the Closing Sale Price per share of Common Stock on each Trading
Day in the period during which the Market Price is calculated pursuant to this Section 3.08;


(viii)  before the close of
business on the Business Day immediately preceding the applicable Option
Purchase Date, the Trustee shall have received an Opinion of Counsel stating
that:


(I)            the shares of
Common Stock to be issued by the Company in full or partial payment of the
Option Purchase Price have been duly authorized and, when issued and delivered
pursuant to the terms of this Indenture in payment of the Option Purchase
Price, will be validly issued, fully paid and non-assessable and, to the best
of such counsel’s knowledge, free from preemptive rights;


(II)           the shares of
Common Stock to be delivered as payment, in whole or in part, of the Option
Purchase Price are registered under the Securities Act;


(III)          the shares of
Common Stock to be delivered as payment, in whole or in part, of the Option Purchase
Price are duly qualified or registered under applicable state securities laws
or are qualified for an available exemption from such qualification and
registration; and


(IV)          the shares of Common
Stock to be delivered as payment, in whole or in part, of the Option Purchase
Price are qualified for listing on a U.S. national securities exchange or for
quotation on The Nasdaq National Market; and


(ix)     upon determination of the
actual number of shares of Common Stock to be delivered as provided in this Section 3.08
in full or partial payment of the Option Purchase Price, the Company shall have
disseminated a press release through PR Newswire containing this information or
shall have published the information on the Company’s web site or through such
other public medium as the Company may use at that time.


If, as of the Business Day
immediately preceding the applicable Option Purchase Date, any of the foregoing
conditions are not satisfied, with respect to a Holder of Securities subject to
the Repurchase at Holder’s Option and the Company has elected, pursuant to this
Section
3.08, to pay all or a portion of the Option Purchase Price in shares
of Common Stock, the Company shall pay the entire Option Purchase Price of such
Securities in cash.


 


(E)           The Company shall give notice (“Option
Purchase Notice”) on a date not less than twenty (20) Business Days
prior to the applicable Option Purchase Date to all Holders at their addresses
shown in the register and to beneficial owners as required by applicable
law.  Such notice shall state:


 


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(i)            the Option Purchase
Price plus accrued and unpaid interest, if any, to, but excluding, the
applicable Option Purchase Date and the Conversion Rate;


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


(iii)          that Securities as
to which a Purchase Notice has been given may be converted pursuant to Article X
only if the applicable Purchase Notice has been withdrawn in accordance with
the terms of this Indenture;


(iv)          that Securities must
be surrendered to the Paying Agent to collect payment of the Option Purchase
Price plus accrued and unpaid interest, if any, to, but excluding, the
applicable Option Purchase Date;


(v)           that the Option
Purchase Price, plus accrued and unpaid interest, if any, to, but excluding,
the applicable Option Purchase Date, for any Security as to which a Purchase
Notice has been given and not withdrawn will be paid as promptly as practicable
following the later of the applicable Option Purchase Date or the time of
delivery of the Security, but in no event more than three (3) Business Days
following the later of the applicable Option Purchase Date or the time of
delivery of the Security as described in (iv);


(vi)          the procedures the
Holder must follow to exercise rights under this Section 3.08 and a brief
description of those rights;


(vii)         briefly, the
conversion rights of the Securities and that Holders who want to convert
Securities must satisfy the requirements set forth in paragraph 10 of the
Securities;


(viii)        that a Holder will
be entitled to withdraw its election if the Company (if acting as its own
Paying Agent), or the Paying Agent receives, at any time prior to the close of
business on the Business Day prior to the applicable Option Purchase Date, or
such longer period as may be required by law, a letter or telegram, telex or
facsimile transmission (receipt of which is confirmed and promptly followed by
a letter) setting forth (I) the name of such Holder, (II) statement that such
Holder is withdrawing his election to have Securities repurchased, (III) the
principal amount of Securities of such Holder to be so withdrawn, which amount
must be $1,000 or an integral multiple thereof, (IV) the certificate number of
such Securities to be so withdrawn, (V) the principal amount, if any, of
Securities of such Holder that remain subject to the Purchase Notice delivered
by such Holder in accordance with this Section 3.08, which amount must be $1,000
or an integral multiple thereof, and (VI) that Securities with respect to which
a Purchase Notice is given by such Holder may be converted, if otherwise
convertible, only if the Purchase Notice has been withdrawn in accordance with
the terms hereof;


(ix)          that, unless the
Company defaults in making payment of such Option Purchase Price or such
accrued and unpaid interest, interest on Securities surrendered for purchase
will cease to accrue, and such Securities shall cease to be convertible on and
after the applicable Option Purchase Date;


 


-22-

















 


(x)           the CUSIP number of
the Securities; and


(xi)          if the applicable
Option Purchase Date is August 16, 2013 or August 16, 2018:


(I)            whether the Company
will pay the Option Purchase Price in cash or shares of Common Stock or in a
combination thereof, in each case specifying the percentages of the Option
Purchase Price in respect of which the Company will pay in cash or shares of
Common Stock;


(II)           if applicable, that
each Holder will receive shares of Common Stock, the Market Price (determined
as of a specified date prior to the applicable Option Purchase Date) of which
shares will be equal to a specified percentage of the Option Purchase Price of
the Securities held by such Holder (except any cash amount to be paid in lieu
of fractional shares);


(III)          if applicable, the
method of calculating the Market Price of the shares of Common Stock to be
delivered as payment, in whole or in part, of the Option Purchase Price; and


(IV)          if applicable, that
because the Market Price of shares of Common Stock will be determined prior to
the applicable Option Purchase Date, Holders of the Securities will bear the
market risk that the Common Stock will decline in value between the date such
Market Price is determined and the applicable Option Purchase Date.


At
the Company’s request, the Trustee shall give such notice in the Company’s name
and at the Company’s expense; provided, however, that, in all cases, the
text of such notice shall be prepared by the Company.


There
shall be no purchase of any Securities pursuant to this 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 Purchase Notice) and is continuing an Event
of Default (other than a default in the payment of the Option Purchase Price or
accrued and unpaid interest, if any, payable as herein provided upon Repurchase
at Holder’s Option).  The Paying Agent
will promptly return to the respective Holders thereof any Securities held by
it during the continuance of an Event of Default (other than a default in the
payment of the Option Purchase Price or such accrued and unpaid interest) in
which case, upon such return, the Purchase Notice with respect thereto shall be
deemed to have been withdrawn.


Notwithstanding
anything herein to the contrary, if the option granted to Securityholders to
require the repurchase of the Securities on an Option Purchase Date is determined
to constitute a tender offer, the Company will comply with all applicable
tender offer rules under the Exchange Act, including Rules 13e-4 and 14e-1, and
file Schedule a TO or any other schedules required under the Exchange Act.


 


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3.09         Repurchase at Option of Holder upon a
Repurchase Event.


Upon
any Repurchase Event (as defined below) of the Company, each Holder of
Securities shall have the right (the “Repurchase Right”), at the Holder’s option,
subject to the rights of the holders of Senior Indebtedness under Article XI,
to require the Company to repurchase all of such Holder’s Securities, or a
portion thereof which is $1,000 in principal amount or any integral multiple
thereof, on a date (the “Repurchase Date”) no later than thirty (30)
days after the date the Repurchase Event Notice (as defined below) is mailed in
accordance with the immediately succeeding paragraph, at the Repurchase Price
plus accrued and unpaid interest, if any, to, but excluding, the Repurchase
Date.


Within
fifteen (15) days after the occurrence of a Repurchase Event of the Company,
the Company shall mail to all Holders of record of the Securities at their
addresses shown in the register of the Registrar, and to beneficial owners as
required by applicable law, a notice (the “Repurchase Event Notice”) of the occurrence
of such Repurchase Event and the Repurchase Right arising as a result
thereof.  The Company shall deliver a
copy of the Repurchase Event Notice to the Trustee and shall cause a copy to be
published at the expense of the Company in The New York Times
or The Wall Street Journal  or another newspaper of national circulation.


Each
Repurchase Event Notice shall state:


(i)         the events causing the Repurchase
Event;


(ii)        the date of such Repurchase Event;


(iii)       the Repurchase Date;


(iv)       the date by which the Repurchase Right
must be exercised;


(v)        the Repurchase Price plus accrued and
unpaid interest, if any, to, but excluding, the Repurchase Date;


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


(vii)      a description of the procedure which a
Holder must follow to exercise a Repurchase Right;


(viii)     that, in order to exercise the Repurchase
Right, the Securities must be surrendered for payment of the Repurchase Price
plus accrued and unpaid interest, if any, payable as herein provided upon
Repurchase Upon Repurchase Event;


(ix)       that a Holder will be entitled to
withdraw its election if the Company (if acting as its own Paying Agent), or
the Paying Agent receives, prior to the close of business on the Business Day
immediately preceding the Repurchase Date, or such longer period as may be
required by law, a letter or telegram, telex or facsimile transmission (receipt
of which is confirmed and promptly followed by a letter) setting forth (I) the
name of such Holder, (II) statement that such Holder is withdrawing his 


 


-24-

















 


election to have
Securities repurchased, (III) the principal amount of Securities of such Holder
to be so withdrawn, which amount must be $1,000 or an integral multiple
thereof, (IV) the certificate number of such Securities to be so withdrawn, (V)
the principal amount, if any, of Securities of such Holder that remains subject
to the Purchase Notice delivered by such Holder in accordance with this Section 3.09,
which amount must be $1,000 or an integral multiple thereof, and (VI) that
Securities with respect to which a Purchase Notice is given by such Holder may
be converted, if otherwise convertible, only if the Purchase Notice has been
withdrawn in accordance with the terms hereof;


(x)        the Conversion Rate and any adjustments
to the Conversion Rate that will result from the Repurchase Event;


(xi)       that Securities with respect to which a
Purchase Notice is given by a Holder may be converted, if otherwise convertible
in accordance with Article X, only if such Purchase Notice has
been withdrawn in accordance with this Section 3.09;


(xii)      the place or places where such Securities
may be surrendered for conversion; and


(xiii)     the CUSIP number or numbers, as the case
may be, of the Securities.


No
failure of the Company to give the foregoing notice shall limit any Holder’s
right to exercise a Repurchase Right.


To
exercise a Repurchase Right, a Holder shall deliver to the Company (if it is
acting as its own Paying Agent), or to a Paying Agent designated by the Company
for such purpose in the Repurchase Event Notice, (i) no later than the close of
business on the Business Day immediately preceding the Repurchase Date, a
Purchase Notice, in the form set forth in the Securities or any other form of
written notice substantially similar thereto, in each case, duly completed and
signed, with appropriate signature guarantee, and stating (A) the certificate
number of the Security which the Holder will deliver to be repurchased, (B) the
principal amount of Securities to be repurchased, which must be $1,000 or an
integral multiple thereof, and (C) that such Security is being tendered for
repurchase pursuant to the terms and conditions specified in paragraph 9 of
the Securities and in this Indenture; and (ii) at any time after the delivery
of such Purchase Notice, such Securities with respect to which the Repurchase
Right is being exercised, duly endorsed for transfer to the Company.  Upon such delivery of Securities to the Company
(if it is acting as its own Paying Agent) or such Paying Agent, such Holder
shall be entitled to receive from the Company or such Paying Agent, as the case
may be, a nontransferable receipt of deposit evidencing such delivery.


In
the event a Repurchase Right shall be exercised in accordance with the terms
hereof, the Company shall pay or cause to be paid the Repurchase Price, plus
accrued and unpaid interest, if any, to, but excluding, the Repurchase Date,
with respect to the Securities as to which the Repurchase Right shall have been
exercised to the Holder thereof promptly following the later of the Repurchase
Date or the time of delivery of the Security, subject to the provisions of the
immediately preceding paragraph.


 


-25-

















 


On
or prior to a Repurchase Date, the Company shall deposit with the Trustee or
with a Paying Agent (or, if the Company is acting as its own Paying Agent,
segregate and hold in trust in accordance with Section 2.04) an amount
of money (to be available on the Repurchase Date) sufficient to pay the
Repurchase Price, plus accrued and unpaid interest, if any, to, but excluding,
the Repurchase Date, of all of the Securities which are to be repurchased on
that date.


Both
the Repurchase Event Notice and the Purchase Notice having been duly given as
specified in this Section 3.09, the Securities to be so
repurchased shall, on the Repurchase Date, become due and payable at the
Repurchase Price (plus accrued and unpaid interest, if any, to, but excluding,
the Repurchase Date) applicable thereto and from and after such date (unless
there shall be a default in the payment of the Repurchase Price or such accrued
and unpaid interest) such Securities shall cease to bear interest and shall
cease to be convertible.  Upon surrender
of any such Security for repurchase in accordance with such Purchase Notice,
such Security shall be paid by the Company at the Repurchase Price plus such
accrued and unpaid interest.


If
any Security shall not be paid upon surrender thereof for repurchase, the
principal shall, until paid, bear interest from the Repurchase Date at the rate
borne by such Security on the principal amount of such Security and shall
continue to be convertible.


Any
Security which is to be submitted for Repurchase Upon Repurchase Event only in
part shall be delivered pursuant to this Section 3.09 (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 its attorney duly authorized in writing), and the Company
shall execute, and the Trustee shall authenticate and make available for
delivery to the Holder of such Security without service charge, a new Security
or Securities, of any authorized denomination as requested by such Holder, of
the same tenor and in aggregate principal amount equal to the portion of such
Security not submitted for repurchase.


There
shall be no purchase of any Securities pursuant to this Section 3.09 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 Repurchase Event Notice) and is continuing
an Event of Default (other than a default in the payment of the Repurchase
Price or accrued and unpaid interest, if any, payable as herein provided upon
Repurchase Upon Repurchase Event).  The
Paying Agent will promptly return to the respective Holders thereof any Securities
held by it during the continuance of an Event of Default (other than a default
in the payment of the Repurchase Price or such accrued and unpaid interest) in
which case, upon such return, the Repurchase Event Notice with respect thereto
shall be deemed to have been withdrawn.


Notwithstanding
anything herein to the contrary, if the option granted to Securityholders to
require the repurchase of the Securities upon the occurrence of a Repurchase
Event is determined to constitute a tender offer, the Company will comply with
all applicable tender offer rules under the Exchange Act, including Rules 13e-4
and 14e-1, and file a Schedule TO or any other schedules required under the
Exchange Act .


As
used in this Section 3.09 and in the Securities:


 


-26-

















 


A
“Repurchase
Event” of the Company shall be deemed to have occurred upon the
occurrence of either a “Change in Control” or a “Termination of Trading.”


A
“Change
in Control” of the Company shall be deemed to have occurred at such
time as:


(i)            any “person” or “group” (as such
terms are used for purposes of Sections 13(d) and 14(d) of the Exchange Act) is
or becomes the “beneficial owner” (as such term is used in Rule 13d-3 under the
Exchange Act), directly or indirectly, of fifty percent (50%) or more of the
total voting power of all classes of the Company’s Capital Stock entitled to
vote generally in the election of directors; or


(ii)           at any time the following persons
cease for any reason to constitute a majority of the Company’s Board of
Directors:


(1)           individuals who on the Issue Date
constituted the Company’s Board of Directors; and


 


(2)           any new directors whose election to
the Company’s Board of Directors or whose nomination for election to the
Company’s stockholders was approved by at least a majority of the directors
then still in office who were either directors on the Issue Date or whose
election or nomination for election was previously so approved; or


 


(iii)           The Company consolidates with, or
merges with or into, another person or any person consolidates with, or merges
with or into, the Company, in any such event other than pursuant to a
transaction in which the persons that “beneficially owned,” directly or
indirectly, the shares of the Company’s Voting Stock immediately prior to such
transaction, “beneficially own,” directly or indirectly, immediately after such
transaction, shares of the Company’s Voting Stock representing at least a
majority of the total voting power of all outstanding classes of Voting Stock
of the continuing or surviving corporation in substantially the same proportion
as such ownership prior to the transaction; or


(iv)       the sale, lease, transfer or other
conveyance or disposition of all or substantially all of the assets or property
of the Company to any “person” or “group” (as such terms are used in Sections
13(d) and 14(d) of the Exchange Act), including any group acting for the
purpose of acquiring, holding, or disposing of securities within the meaning of
Rule 13d-5(b)(1) under the Exchange Act; or


(v)           the Company is liquidated or
dissolved or the holders of the Company’s Capital Stock approve any plan or
proposal for the liquidation or dissolution of the Company;


 


provided, however,
that a Change in Control shall not be deemed to occur if either:


 


-27-

















 


(A)          the Closing Sale Price for each of any
five (5) Trading Days during the ten (10) Trading Days immediately preceding
the Change in Control is equal to at least one hundred and five percent (105%)
of the Conversion Price in effect on such Trading Day;


 


(B)           in the case of a merger or
consolidation, all of the consideration (excluding cash payments for fractional
shares and cash payments pursuant to dissenters’ appraisal rights) in the
merger or consolidation constituting the Change in Control consists of common
stock traded on a U.S. national securities exchange or quoted on The Nasdaq
National Market (or which will be so traded or quoted when issued or exchanged
in connection with such Change in Control) and as a result of such transaction
or transactions the Securities become convertible solely into such common
stock; or


 


(C)           in the case of a Qualifying Foreign
Merger, all of the consideration (excluding cash payments for fractional shares
and cash payments pursuant to dissenters’ or appraisal rights) in the
Qualifying Foreign Merger constituting the Change in Control consists of common
stock or American Depositary Shares representing such common stock traded on a
U.S. national securities exchange or quoted on The Nasdaq National Market (or
which will be so traded or quoted when issued or exchanged in connection with
such Change in Control) and as a result of such transaction or transactions the
Securities become convertible solely into such common stock or American
Depositary Shares.


 


A
“Termination
of Trading” shall occur if the Common Stock of the Company (or other
common stock into which the Securities are then convertible) is neither listed
for trading on a U.S. national securities exchange nor approved for trading on
an established automated over-the-counter trading market in the United States; provided,
however,
that a Termination of Trading shall not be deemed to have occurred solely by
reason of the Company having engaged in a Qualifying Foreign Merger, so long
as, immediately after such Qualifying Foreign Merger, the Holders shall have
the right to convert their Securities solely into common stock or American
Depositary Shares representing such common stock traded on a U.S. national
securities exchange or quoted on The Nasdaq National Market, until such time as
the common stock or American Depositary Shares on such common stock into which
the Securities are solely convertible are no longer so traded or quoted.


 


3.10         Conversion Arrangement on Call for
Redemption.


In connection with any
redemption of Securities, the Company may arrange, in lieu of redemption, for
the purchase and conversion of any Securities called for redemption by an
agreement with one or more investment bankers or other purchasers to purchase
all or a portion of such Securities by paying to the Paying Agent in trust for
the Holders whose Securities are to be so purchased, 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 redemption of such
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 III, the obligation of the Company
to pay the Redemption Price of such Securities, 


 


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including all accrued
interest, if any, shall be deemed to be satisfied and discharged to the extent
such amount is so paid by such purchasers, but no such agreement shall relieve
the Company of its obligation to pay such Redemption Price or such accrued
interest, if any.  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 X) surrendered by
such purchasers for conversion, all as of 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 for purchase and conversion in the same manner as it would
moneys deposited with it by the Company for the redemption of Securities.  Without the prior written consent of the
Trustee and the Paying Agent, 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, rights, immunities,
responsibilities or obligations of the Trustee or Paying Agent as set forth in
this Indenture, and the Company agrees to indemnify the Trustee and Paying
Agent from, and hold them harmless against, any and all 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 (including counsel fees and
expenses) incurred by the Trustee or Paying Agent in the defense of any claim
or liability arising out of or in connection with the exercise or performance
of any of their powers, duties, responsibilities or obligations under this
Indenture except to the extent arising from its bad faith, willful misconduct
or negligence.


IV.           COVENANTS


4.01         Payment of Securities.


The
Company shall pay all amounts due with respect to the Securities on the dates
and in the manner provided in the Securities. 
All such amounts shall be considered paid on the date due if the Paying
Agent holds (or, if the Company is acting as Paying Agent, if the Company has
segregated and holds in trust in accordance with Section 2.04) on that
date money sufficient to pay the amount then due with respect to the
Securities.


The
Company shall pay interest on any overdue amount (including, to the extent
permitted by applicable law, overdue interest) at the rate borne by the
Securities.


4.02         Maintenance of Office or Agency.


The
Company will maintain in the Borough of Manhattan, the City of New York, an
office or agency (which may be an office of the Trustee or an affiliate of the
Trustee, Registrar or co-Registrar) where Securities may be surrendered for
registration of transfer or exchange or conversion and where notices and
demands to or upon the Company in respect of the Securities and this Indenture
may be served.  The Company will give
prompt written notice to the Trustee of the location, and any change in the
location, of such 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
Corporate Trust Office of the Trustee.


 


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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. 
The Company will give prompt written notice to the Trustee of any such
designation or rescission and of any change in the location of any such other
office or agency.


The
Company hereby designates the Corporate Trust Office of the Trustee as an
agency of the Company in accordance with Section 2.03.


4.03         Reports.


(A)          The Company will promptly provide to
the Trustee and shall, upon request, provide to any Holder or beneficial owner
of Securities or prospective purchaser of Securities that so requests, the
information required to be delivered pursuant to Rule 144A(d)(4) until such
time as the Securities and the underlying Common Stock have been registered by
the Company for resale under the Securities Act pursuant to the Registration
Rights Agreement.  In addition, the
Company will furnish such Rule 144A(d)(4) information if, at any time while the
Securities or the Common Stock issuable upon conversion of the Securities are
restricted securities within the meaning of the Securities Act, the Company is
not subject to the informational requirements of the Exchange Act.


(B)           The Company will comply with the
provisions of TIA § 314(a).


4.04         Compliance Certificate.


The
Company shall deliver to the Trustee, within 90 days after the end of each
fiscal year of the Company, an Officers’ Certificate stating whether or not the
signers know of any Default or Event of Default by the Company in performing
any of its obligations under this Indenture or the Securities.  If they do know of any such Default or Event
of Default, the certificate shall describe the Default or Event of Default and
its status.


4.05         Stay, Extension and Usury Laws.


The
Company covenants (to the extent that it may lawfully do so) that it will not
at any time insist upon, plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay, extension or usury law wherever enacted, now
or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (in each case, to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law, and covenants that it will not, by resort to any such law,
hinder, delay or impede the execution of any power herein granted to the Trustee,
but will suffer and permit the execution of every such power as though no such
law has been enacted.


4.06         Corporate Existence.


Subject
to Article V,
the Company will do or cause to be done all things necessary to preserve and
keep in full force and effect its corporate existence and the corporate
existence of 


 


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each of the Subsidiaries in accordance with the respective
organizational documents of each Subsidiary and the rights (charter and
statutory), licenses and franchises of the Company and the Subsidiaries; provided,
however,
that the Company shall not be required to preserve any such right, license or
franchise, or the corporate existence of any Subsidiary, if in the judgment of
the Board of Directors (i) such preservation or existence is not material to
the conduct of business of the Company and (ii) the loss of such right, license
or franchise or the dissolution of such Subsidiary does not have a material
adverse impact on the Holders.


4.07         Notice of Default.


In
the event that any Default or Event of Default shall occur, the Company will
give prompt written notice of such Default or Event of Default to the Trustee,
and any remedial action proposed to be taken.


V.            SUCCESSORS


5.01         When Company May Merge, etc.


The
Company shall not consolidate with, or merge with or into, or sell, convey,
transfer, lease or otherwise dispose of all or substantially all of its
properties and assets to, another person (whether in a single or series of
related transactions) unless:


(A)          the resulting, surviving or transferee
person is either (i) a corporation, limited liability company, partnership or
trust organized and existing under the laws of the United States, any State
thereof or the District of Columbia or (ii) a corporation, limited liability
company, partnership or trust organized and existing under the laws of a
jurisdiction outside the United States; provided, however, that in the case of
a transaction where the resulting, surviving or transferee person is organized
under the laws of a jurisdiction outside the United States, the Company shall
not consummate the transaction unless (I) such person has common stock or
American Depository Shares representing such common stock traded on a national
securities exchange in the United States or quoted on The Nasdaq National
Market; (II) such person has a worldwide total market capitalization of its
equity securities (before giving effect to such consolidation, merger or
disposition) of at least US$5 billion; (III) such person has consented to
service of process in the United States; (IV) the Company shall have made
provision for the satisfaction of the Company’s obligations, if any, to
repurchase Securities upon a Repurchase Upon Repurchase Event; and (V) the
Company shall have obtained an opinion of tax counsel experienced in such
matters to the effect that, under the then-existing U.S. federal tax laws,
there would be no material adverse tax consequences to holders of the
Securities resulting from such transaction (a transaction that satisfies the
above conditions, a “Qualifying Foreign Merger”);


(B)           the resulting, surviving or
transferee person assumes by supplemental indenture all the obligations of the
Company under the Securities and this Indenture; and


(C)           immediately after giving effect to
such transaction, no Default or Event of Default shall exist.


 


-31-

















 


The
Company shall deliver to the Trustee prior to the consummation of the proposed
transaction an Officers’ Certificate to the foregoing effect and an Opinion of
Counsel, which may rely upon such Officers’ Certificate as to the absence of
Defaults and Events of Default, stating that the proposed transaction and such
supplemental indenture will, upon consummation of the proposed transaction,
comply with this Indenture.


5.02         Successor Substituted.


Upon
any consolidation or merger or sale, conveyance, transfer, lease, or other
disposition of all or substantially all of the assets of the Company in accordance
with Section 5.01,
the successor person formed by such consolidation or into which the Company is
merged or to which such sale, conveyance, transfer, lease, or other disposition
is made shall succeed to, and, except in the case of a lease, be substituted
for, and may exercise every right and power of, and shall assume every duty and
obligation of, the Company under this Indenture with the same effect as if such
successor had been named as the Company herein.  When the successor assumes all obligations of the Company
hereunder, except in the case of a lease, all obligations of the predecessor
shall terminate.


VI.           DEFAULTS
AND REMEDIES


6.01         Events of Default.


An
“Event of
Default” occurs if:


(i)         the Company fails to pay the principal
of or premium, if any, of any Security when the same becomes due and payable,
whether at maturity, upon Redemption, on an Option Purchase Date with respect
to a Repurchase at Holder’s Option, on a Repurchase Date with respect to a
Repurchase Upon Repurchase Event or otherwise, whether or not such payment
shall be prohibited by the provisions of Article XI hereof;


(ii)        the Company fails to pay an installment
of interest or liquidated damages, if any, on the Securities when due, if such
failure continues for thirty (30) days after the date when due, whether or not
such payment shall be prohibited by the provisions of Article XI hereof; provided, that a
failure to make any of the first six (6) scheduled interest payments on any
Security within three (3) Business Days after the applicable interest payment
dates will constitute an Event of Default with no additional grace or cure
period;


(iii)       the Company fails to provide a timely
Repurchase Event Notice, or a notice required under Section 3.08(E), as required
by the provisions of this Indenture;


(iv)       the Company fails to comply with any
other term, covenant, or agreement set forth in the Securities or this
Indenture and such failure continues for the period, and after the notice,
specified below;


 


-32-

















 


(v)        the Company fails to perform or observe
any of its obligations under the Pledge Agreement (including any supplement
thereto) or the Control Agreement or the Company’s representations and
warranties set forth in such agreements fail to be true and correct, in all
material respects, when deemed made;


(vi)       the Pledge Agreement shall cease to be in
full force and effect or enforceable in accordance with its terms;


(vii)      the Company or any of the Subsidiaries
defaults in the payment when due, after the expiration of any applicable grace
period, of principal of, or premium, if any, or interest on Indebtedness for
money borrowed, in the aggregate principal amount then outstanding of
$15,000,000 or more, or the acceleration of Indebtedness for money borrowed in
such aggregate principal amount so that it becomes due and payable prior to the
date on which it would otherwise become due and payable and such acceleration
is not rescinded or such default is not cured within thirty (30) days after notice
to the Company by the Trustee or to the Company and the Trustee by holders of
not less than twenty five percent (25%) in the aggregate principal amount of
the Securities then outstanding, each in accordance with this Indenture;


(viii)     the Company or any of the Subsidiaries
fails to pay final judgments, the uninsured portion of which aggregates in
excess of $10,000,000, and such judgments are not paid, discharged or stayed
for a period of thirty (30) days;


(ix)       the Company or any of its Significant
Subsidiaries or any group of Subsidiaries that in the aggregate would
constitute a Significant Subsidiary of the Company pursuant to, or within the
meaning of, any Bankruptcy Law:


(A)          commences a voluntary case,


(B)           consents to the entry of an order for
relief against it in an involuntary case,


(C)           consents to the appointment of a
Custodian of it or for all or substantially all of its property, or


(D)          makes a general assignment for the
benefit of its creditors; or


(x)        a court of competent jurisdiction enters
an order or decree under any Bankruptcy Law that:


(A)                                is for relief against the Company or any
of its Significant Subsidiaries or any group of Subsidiaries that in the
aggregate would constitute a Significant Subsidiary of the Company in an
involuntary case or proceeding, or adjudicates the Company or any of its
Significant Subsidiaries or any group of Subsidiaries that in the aggregate
would constitute a Significant Subsidiary of the Company insolvent or bankrupt,


 


-33-

















 


(B)                                  appoints a Custodian of the Company or
any of its Significant Subsidiaries or any group of Subsidiaries that in the
aggregate would constitute a Significant Subsidiary of the Company for all or
substantially all of the property of the Company or any such Significant
Subsidiary or any group of Subsidiaries that in the aggregate constitute a
Significant Subsidiary of the Company, as the case may be, or


(C)                                  orders the winding up or liquidation of
the Company or any of its Significant Subsidiaries or any group of Subsidiaries
that in the aggregate constitute a Significant Subsidiary of the Company, and
the order or decree remains unstayed and in effect for ninety (90) consecutive
days.


The
term “Bankruptcy
Law” means Title 11, U.S. Code or any similar Federal or State law
for the relief of debtors.  The term “Custodian”
means any receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.


A
default under clause (iv) is not an Event of Default until (I) the Trustee
notifies the Company or the Holders of at least twenty five percent (25%) in
aggregate principal amount of the Securities then outstanding notify the
Company and the Trustee in writing of the default and (II) the default is not
cured within sixty (60) days after receipt of the notice.  The notice must specify the default, demand
that it be remedied and state that the notice is a “Notice of Default”.  If the Holders of twenty five percent (25%)
in aggregate principal amount of the outstanding Securities request the Trustee
to give such notice on their behalf, the Trustee shall do so at the expense of
the Company.  When a default is cured,
it ceases.


6.02         Acceleration.


If
an Event of Default (other than an Event of Default specified in Section 6.01(ix)
or (x) with respect to the Company) as to which the Trustee has
received written notice pursuant to the provisions of this Indenture occurs and
is continuing, the Trustee by notice to the Company or the Holders of at least
twenty five percent (25%) in principal amount of the Securities then outstanding
by notice in writing to the Company and the Trustee may declare the Securities
to be due and payable.  Upon such
declaration such principal and interest shall be due and payable immediately.  If an Event of Default specified in Section 6.01(ix)
or (x) with respect to the Company occurs, the principal of and
accrued interest on all the Securities shall ipso facto become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Securityholder.  The
Holders of a majority in aggregate principal amount of the Securities then
outstanding by written notice to the Trustee may rescind or annul an
acceleration and its consequences if the rescission would not conflict with any
order or decree and if all existing Events of Default have been cured or waived
except nonpayment of principal or interest that has become due solely because
of the acceleration and if all amounts due to the Trustee under Section 7.07
have been paid.


 


-34-

















 


6.03         Other Remedies.


Notwithstanding
any other provision of this Indenture, if an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy by proceeding at law or
in equity to collect the payment of amounts due with respect to the Securities
or to enforce the performance of any provision of the Securities or this
Indenture.


The
Trustee may maintain a proceeding even if it does not possess any of the Securities
or does not produce any of them 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.  All remedies are
cumulative.


6.04         Waiver of Past Defaults.


Subject
to Sections 6.07
and 9.02, the Holders of a majority in aggregate principal amount
of the Securities then outstanding by written notice to the Trustee may waive
any past Default or Event of Default and its consequences, other than (A) a
Default or Event of Default in the payment of the principal of, premium, if
any, or interest on any Security, or in the payment of the Redemption Price,
the Option Purchase Price or the Repurchase Price (or accrued and unpaid
interest, if any, payable as herein provided upon Redemption, Repurchase at
Holder’s Option or Repurchase Upon Repurchase Event), (B) a Default or Event of
Default arising from a failure by the Company to convert any Securities into
Common Stock or (C) any Default or Event of Default in respect of any provision
of this Indenture or the Securities which, under Section 9.02, cannot be
modified or amended without the consent of the Holder of each Security
affected.  When a Default or an Event of
Default is waived, it is cured and ceases for every purpose of this Indenture.


6.05         Control by Majority.


The
Holders of a majority in aggregate principal amount of the Securities then
outstanding may direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or power
conferred on it.  However, the Trustee
may refuse to follow any direction that conflicts with law or this Indenture,
is unduly prejudicial to the rights of other Securityholders or would involve
the Trustee in personal liability unless the Trustee is offered indemnity
reasonably satisfactory to it; provided that the Trustee may take any
other action deemed proper by the Trustee which is not inconsistent with such
direction.


6.06         Limitation on Suits.


Except
as provided in Section 6.07, a Securityholder may not pursue a remedy
with respect to this Indenture or the Securities unless:


(i)         the Holder gives to the Trustee written
notice of a continuing Event of Default;


 


-35-

















 


(ii)        the Holders of at least twenty five
percent (25%) in aggregate principal amount of the Securities then outstanding
make a written request to the Trustee to pursue the remedy;


(iii)       such Holder or Holders offer and, if
requested, provide to the Trustee indemnity reasonably satisfactory to the Trustee
against any loss, liability or expense;


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


(v)        during such sixty (60) day period, the
Holders of a majority in aggregate principal amount of the Securities then
outstanding do not give the Trustee a direction inconsistent with the request.


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


6.07         Rights of Holders to Receive Payment.


Notwithstanding
any other provision of this Indenture, the right of any Holder to receive payment
of all amounts due with respect to the Securities, on or after the respective
due dates expressed in the Securities, or to bring suit for the enforcement of
any such payment on or after such respective dates, shall not be impaired or
affected without the consent of the Holder.


Notwithstanding
any other provision of this Indenture, the right of any Holder to bring suit
for the enforcement of the right to convert the Security in accordance with
this Indenture shall not be impaired or affected without the consent of the
Holder.


6.08         Collection Suit by Trustee.


If
an Event of Default specified in Section 6.01(i) or (ii)
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 due
with respect to the Securities, including any unpaid and accrued interest.


6.09         Trustee May File Proofs of Claim.


The
Trustee may file such proofs of claim and other papers or documents as may be
necessary or advisable in order to have the claims of the Trustee, any
predecessor Trustee and the Securityholders allowed in any judicial proceedings
relative to the Company or its creditors or properties.


The
Trustee may 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 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 


 


-36-

















 


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 claim of any Holder in any such proceeding.


6.10         Priorities.


Subject
to the provisions of the Pledge Agreement and Article XII, if the Trustee
collects any money pursuant to this Article VI, it shall pay out the money in
the following order:


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


Second:                              to holders of Senior Indebtedness to the extent required
by Article XI;


Third:                                         to Securityholders for all amounts due and unpaid on
the Securities, without preference or priority of any kind, according to the
amounts due and payable on the Securities;


Fourth:                                  to such other Person or
Persons, if any, to the extent entitled thereto; and


Fifth:                                             to the Company.


The
Trustee, upon prior written notice to the Company may fix a record date and
payment date for any payment by it to Securityholders pursuant to this Section 6.10.


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 in the
suit other than the Trustee 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 ten percent (10%) in aggregate principal
amount of the outstanding Securities.


VII.          TRUSTEE


7.01         Duties of Trustee.


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


 


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(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 implied
covenants or obligations shall be read into this Indenture against the Trustee;
and


(ii)        in the absence of bad faith, willful
misconduct or negligence 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; but in the case of any such certificates
or opinions which by any provision hereof are specifically required to be
furnished to the Trustee, the Trustee shall examine the certificates and
opinions to determine whether or not they conform to the requirements of this
Indenture (but need not confirm or investigate the accuracy of mathematical
calculations or other facts stated therein).


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


(ii)        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 the provisions of this Section 7.01.


(E)           The Trustee shall not be liable for
interest on any money received by it except as the Trustee may agree in writing
with the Company.  Money held in trust
by the Trustee need not be segregated from other funds except to the extent
required by law.


7.02         Rights of Trustee.


(A)          Subject to Section 7.01, the Trustee may
conclusively 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; if, however, the Trustee shall determine to make such further inquiry
or investigation, it shall be entitled during normal business hours to examine
the relevant books, records and premises of the Company, personally or by agent
or attorney upon reasonable prior notice.


(B)           Before the Trustee acts or refrains
from acting, it may require an Officers’ Certificate and/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 Officers’ Certificate or Opinion of Counsel.


 


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(C)           Any request or direction of the
Company mentioned herein shall be sufficiently evidenced by a Company Request
or Company Order and any resolution of the Board of Directors shall be sufficiently
evidenced by a Board Resolution.


(D)          The Trustee may consult with counsel
(such counsel to be reasonably acceptable to the Company) and the advice of
such counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon.


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


(F)           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 discretion, rights or powers conferred upon it by this
Indenture.


(G)          Except with respect to Section 6.01,
the Trustee shall have no duty to inquire as to the performance of the Company
with respect to the covenants contained in Article IV.  In addition, the Trustee shall not be deemed to have knowledge of
an Event of Default except (i) any Default or Event of Default occurring
pursuant to Sections 6.01(i) and (ii) or (ii) any Default or Event of
Default of which a Responsible Officer of the Trustee shall have received
written notification or obtained actual knowledge.  Delivery of reports, information and documents to the Trustee
under Article IV
(other than Sections 4.04 and 4.07) is for informational purposes only
and the Trustee’s receipt of the foregoing shall not constitute constructive
notice of any information contained therein or determinable from information
contained therein, including the Company’s compliance with any of its covenants
hereunder (as to which the Trustee is entitled to rely exclusively on Officers’
Certificates).


 


(H)          The Trustee shall be under no
obligation to exercise any of the rights or powers vested by this Indenture at
the request or direction of any of the Holders pursuant to this Indenture
unless such Holders shall have offered to the Trustee security or indemnity
reasonably satisfactory to the Trustee against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction.


 


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


 


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


 


(K)          The Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders pursuant to Section 6.05 


 


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relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee, under this Indenture.


 


(L)           No permissive power, right or remedy
conferred on the Trustee hereunder shall be construed to impose a duty to
exercise such power, right or remedy.


 


(M)         None of the provisions of this
Indenture shall be deemed to require the Trustee to expend or risk its own
funds or otherwise incur financial liability in the performance of any of its
duties or in the exercise of any of its rights or powers hereunder.


 


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 otherwise deal with the Company or any of its Affiliates
with the same rights it would have if it were not Trustee.  Any Agent may do the same with like rights.  The Trustee, however, must comply with Sections 7.10
and 7.11.


7.04         Trustee’s Disclaimer.


The
Trustee makes no representation as to the validity, adequacy or priority of
this Indenture or the Securities; it shall not be accountable for the Company’s
use of the proceeds from the Securities; and it shall not be responsible for
any statement in the Securities or in offering materials related to the sale of
the Securities, other than its certificate of authentication.


7.05         Notice of Defaults.


If
a Default or Event of Default occurs and is continuing as to which the Trustee
has received notice pursuant to the provisions of this Indenture, the Trustee
shall mail to each Securityholder a notice of the Default or Event of Default
within thirty (30) days after it occurs unless such Default or Event of Default
has been cured or waived.  Except in the
case of a Default or Event of Default in payment of any amounts due with
respect to any Security, the Trustee may withhold the notice if, and so long as
it in good faith determines that, withholding the notice is in the interests of
Securityholders.


7.06         Reports by Trustee to Holders.


Within
sixty (60) days after each May 15 beginning with May 15, 2004, the Trustee
shall mail to each Securityholder if required by TIA § 313(a) a brief
report dated as of such May 15 that complies with TIA § 313(c).  In such event, the Trustee also shall comply
with TIA § 313(b).


A
copy of each report at the time of its mailing to Securityholders shall be
mailed to the Company and filed by the Trustee with the SEC and each stock
exchange, if any, on which the Securities are listed.  The Company shall promptly notify the Trustee when the Securities
are listed on any stock exchange.


 


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7.07         Compensation and Indemnity.


The
Company shall pay to the Trustee from time to time such compensation for its
services as shall be agreed upon in writing. 
The Trustee’s compensation shall not be limited by any law on
compensation of a trustee of an express trust. 
The Company shall reimburse the Trustee upon request for all reasonable
out-of-pocket expenses incurred by it. 
Such expenses shall include the reasonable compensation and
out-of-pocket expenses of the Trustee’s agents and counsel.


The
Company shall indemnify the Trustee against any and all loss, liability,
damage, claim or expense (including the reasonable fees and expenses of counsel
and taxes other than those based upon the income of the Trustee) incurred by it
in connection with the acceptance or administration of this trust and the
performance of its duties hereunder, including the reasonable costs and
expenses of defending itself against any claim (whether asserted by the
Company, any Holder or any other Person) or liability in connection with the
exercise or performance of any of its powers and duties hereunder.  The Company need not pay for any settlement
made without its consent.  The Trustee
shall notify the Company promptly of any claim for which it may seek
indemnification.  The Company need not
reimburse any expense or indemnify against any loss or liability incurred by
the Trustee through the Trustee’s negligence, bad faith or willful misconduct.


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 amounts due on
particular Securities.


The
indemnity obligations of the Company with respect to the Trustee provided for
in this Section 7.07
shall survive any resignation or removal of the Trustee.


When
the Trustee incurs expenses or renders services after an Event of Default specified
in Section 6.01(ix)
or (x) occurs, the expenses and the compensation for the
services are intended to constitute expenses of administration under any
Bankruptcy Law.


7.08         Replacement of Trustee.


A
resignation or removal of the Trustee and appointment of a successor Trustee
shall become effective only upon the successor Trustee’s acceptance of
appointment as provided in this Section 7.08.


The
Trustee may resign by so notifying the Company in writing thirty (30) Business
Days prior to such resignation.  The
Holders of a majority in aggregate principal amount of the Securities then
outstanding may remove the Trustee by so notifying the Trustee and the Company
in writing and may appoint a successor Trustee with the Company’s consent.  The Company may remove the Trustee if:


(i)         the Trustee fails to comply with Section 7.10;


(ii)        the Trustee is adjudged a bankrupt or an
insolvent;


 


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


(iv)       the Trustee 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 a successor Trustee.


If
a successor Trustee does not take office within thirty (30) days after the
retiring Trustee resigns or is removed, the retiring Trustee (at the Company’s
expense), the Company or the Holders of at least ten percent (10%) in aggregate
principal amount of the outstanding Securities 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 Holder may petition
any court of competent jurisdiction for the removal of the Trustee and the
appointment of 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.


7.09         Successor Trustee by Merger, etc.


If
the Trustee consolidates with, merges or converts into, or transfers all or substantially
all of its corporate trust business to, another corporation, the successor
corporation without any further act shall be the successor Trustee, if such
successor corporation is otherwise eligible hereunder.


7.10         Eligibility; Disqualification.


           There shall at all
times be a Trustee hereunder that is a corporation organized and doing business
under the laws of the United States of America or of any state thereof that is
authorized under such laws to exercise corporate trustee power, that is subject
to supervision or examination by federal or state authorities and that has, or
whose parent bank holding company has, a combined capital and surplus of at
least $100 million as set forth in its most recent published annual report of
condition.  The Trustee shall comply
with TIA § 310(b).


7.11         Preferential Collection of Claims
Against Company.


The
Trustee shall comply with TIA § 311(a), excluding any creditor
relationship listed in TIA § 311(b). 
A Trustee who has resigned or been removed shall be subject to TIA
§ 311(a) to the extent indicated.


 


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VIII.        DISCHARGE
OF INDENTURE


8.01         Termination of the Obligations of the
Company.


This
Indenture shall cease to be of further effect if (a) either (i) all outstanding
Securities (other than Securities replaced pursuant to Section 2.07 hereof) have
been delivered to the Trustee for cancellation or (ii) all outstanding
Securities have become due and payable at their scheduled maturity or upon
Repurchase at Holder’s Option, Redemption or Repurchase Upon Repurchase Event,
and in either case the Company irrevocably deposits with the Trustee or the
Paying Agent (if the Paying Agent is not the Company or any of its Affiliates)
cash (and/or, to the extent permitted by Section 3.08, shares of Common Stock)
sufficient to pay all amounts due and owing on all outstanding Securities
(other than Securities replaced pursuant to Section 2.07 hereof) on the
Maturity Date, Option Purchase Date, Redemption Date or Repurchase Date, as the
case may be; (b) the Company pays to the Trustee all other sums payable
hereunder by the Company; (c) such deposit will not result in a breach or
violation of, or constitute a Default under, Article XI; and (d) the
Company has delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel, each stating that all conditions precedent provided for herein
relating to the satisfaction and discharge of this Indenture have been complied
with; provided,
however,
that Sections
2.02, 2.03, 2.04, 2.05, 2.06, 2.07, 2.08, 2.15, 2.16, 2.17, 3.05, 3.08, 3.09, 4.01, 4.02, 4.05, 7.07 and 7.08 and Articles
VIII,
X
and XII
shall survive any discharge of this Indenture until such time as the Securities
have been paid in full and there are no Securities outstanding.


8.02         Application of Trust Money.


The
Trustee shall hold in trust money deposited with it pursuant to Section 8.01.  It shall apply the deposited money through
the Paying Agent and in accordance with this Indenture to the payment of the
principal of and any unpaid and accrued interest on the Securities.  Money and securities so held in trust are not
subject to the subordination provisions of Article XI.


8.03         Repayment to Company.


The
Trustee and the Paying Agent shall promptly notify the Company of, and pay to
the Company upon the request of the Company, any excess money or securities
held by them at any time.  The Trustee
and the Paying Agent shall pay to the Company upon the written request of the
Company any money held by them for the payment of the principal of and any
unpaid and accrued interest that remains unclaimed for two (2) years; provided,
however,
that the Trustee or such Paying Agent, before being required to make any such
repayment, may, at the expense and request of the Company, cause to be
published once in a newspaper of general circulation in the City of New York or
cause to be mailed to each Holder, notice stating that such money remains and
that, after a date specified therein, which shall not be less than thirty (30)
days from the date of such publication or mailing, any unclaimed balance of
such money then remaining will be repaid to the Company.  After payment to the Company,
Securityholders entitled to the money must look to the Company for payment as
general creditors unless an applicable abandoned property law designates
another person and all liability of the Trustee and the Paying Agent shall
cease.  In the absence of a written
request from the Company to return to the Company funds that are unclaimed
pursuant to this Section 8.03, the Trustee shall, from time to time deliver all
unclaimed funds to, or as directed by, applicable escheat authorities, as
determined by the 


 


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Trustee in its sole discretion, in accordance with the customary
practices and procedures of the Trustee and in accordance with any applicable
law.  Except as otherwise provided by
law or by an agreement to which the Company is a party, the Company shall not
be regarded as a trustee of any such moneys received by the Company pursuant to
this Section
8.03.


8.04         Reinstatement.


If
the Trustee or Paying Agent is unable to apply any money in accordance with Sections 8.01
and 8.02
by reason of any legal proceeding or by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, the obligations of the Company under this Indenture and the
Securities shall be revived and reinstated as though no deposit had occurred
pursuant to Sections 8.01 and 8.02 until such time as the Trustee or
Paying Agent is permitted to apply all such money in accordance with Sections 8.01
and 8.02; provided, however, that if the Company
has made any payment of amounts due with respect to any Securities because of
the reinstatement of its obligations, the Company shall be subrogated to the
rights of the Holders of such Securities to receive such payment from the money
held by the Trustee or Paying Agent.


IX.           AMENDMENTS


9.01         Without Consent of Holders.


The
Company, with the consent of the Trustee, may amend or supplement this Indenture
or the Securities without notice to or the consent of any Securityholder:


(i)         to comply with Sections 5.01 and 10.12;


(ii)        to add to the covenants of the Company
described in this Indenture for the benefit of Securityholders or to surrender
any right or power conferred upon the Company;


(iii)       to secure the obligations of the Company
in respect of the Securities;


(iv)       to make provisions with respect to
adjustments to the Conversion Rate as required by this Indenture or to increase
the Conversion Rate in accordance with this Indenture;


(v)        to make any changes or modifications to
this Indenture necessary in connection with the registration of the Securities
under the Securities Act pursuant to the Registration Rights Agreement and the
qualification of the Indenture under the TIA;


(vi)       to cure any ambiguity, defect, omission
or inconsistency in this Indenture in a manner that does not adversely affect
the rights of any Holder; and


(vii)      to add or modify any other provisions of
the Indenture which the Company and the Trustee jointly deem necessary or
desirable and which shall not adversely affect any Holder’s rights.


 


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9.02         With Consent of Holders.


The
Company, with the consent of the Trustee, may amend or supplement this Indenture
or the Securities without notice to any Securityholder but with the written
consent of the Holders of at least a majority in aggregate principal amount of
the outstanding Securities.  Subject to Section 6.07,
the Holders of a majority in aggregate principal amount of the outstanding
Securities may waive compliance by the Company with any provision of this
Indenture or the Securities without notice to any other Securityholder.  However, without the consent of each
Securityholder affected, an amendment, supplement or waiver, including a waiver
pursuant to Section 6.04, may not:


(a)           change the stated maturity of the
principal of, or the payment date of any installment of interest or liquidated
damages payable on, any Security;


(b)           reduce the principal amount of, or any
premium or interest or liquidated damages on, any Security;


(c)           reduce the amount of principal
payable upon acceleration of the maturity of any Security;


(d)           change the place or currency of
payment of principal of, or any premium or interest or liquidated damages on,
any Security;


(e)           impair the right to institute suit
for the enforcement of any payment on, or with respect to, any Security;


(f)            modify the provisions with respect
to the right of Holders pursuant to Article III to require the Company to purchase
Securities on an Option Purchase Date or to repurchase Securities upon the
occurrence of Repurchase Event in a manner adverse to Holders;


(g)           modify the provisions of Article XI
in a manner adverse to Holders;


(h)           adversely affect the right of Holders
to convert Securities other than as provided in or under Article X;


(i)            reduce the percentage of the
aggregate principal amount of the outstanding Securities whose Holders must
consent to a modification or amendment of any provision of this Indenture;


(j)            reduce the percentage of the
aggregate principal amount of the outstanding Securities necessary for the
waiver of compliance with certain provisions of this Indenture or the waiver of
certain Defaults or Events of Default; and


(k)           modify the provisions of this
Indenture with respect to modification and waiver (including waiver of Events
of Default), except to increase the percentage required for modification or
waiver or to provide for consent of each affected Holder.


 


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An
amendment under this Section 9.02 may not make any change
that adversely affects the rights under Article XI of any holder of Senior
Indebtedness unless the holders of such Senior Indebtedness pursuant to its
terms consent to the change.


Promptly
after an amendment, supplement or waiver under Section 9.01 or this Section 9.02
becomes effective, the Company shall mail to Securityholders a notice briefly
describing such amendment, supplement or waiver.  Any failure of the Company to mail such notice shall not in any
way impair or affect the validity of such amendment, supplement or waiver.


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, supplement or waiver,
but it shall be sufficient if such consent approves the substance thereof.


9.03         Compliance with Trust Indenture Act.


Every
amendment, waiver or supplement to this Indenture or the Securities shall comply
with the TIA as then in effect.


9.04         Revocation and Effect of Consents.


Until
an amendment, supplement or waiver becomes effective, a consent to it by a
Holder is a continuing consent by the Holder and every subsequent Holder of a
Security or portion of a Security that evidences the same debt as the
consenting Holder’s Security, even if notation of the consent is not made on
any Security.  However, any such Holder
or subsequent Holder may revoke the consent as to its Security or portion of a
Security if the Trustee receives the notice of revocation before the date the
amendment, supplement or waiver becomes effective.  An amendment, supplement or waiver becomes effective in
accordance with its terms and thereafter binds every Securityholder.


After
an amendment, supplement or waiver becomes effective with respect to the Securities,
it shall bind every Securityholder unless it makes a change described in Section 9.02.  In that case, the amendment, supplement or
waiver shall bind each Holder of a Security who has consented to it and,
provided that notice of such amendment, supplement or waiver is reflected on a
Security that evidences the same debt as the consenting Holder’s Security,
every subsequent Holder of a Security or portion of a Security that evidences
the same debt as the consenting Holder’s Security.


9.05         Notation on or Exchange of Securities.


If
an amendment, supplement or waiver changes the terms of a Security, the Trustee
may require the Holder of the Security to deliver it to the Trustee.  The Trustee may place an appropriate
notation on the Security as directed and prepared by the Company about the
changed terms and return it to the Holder. 
Alternatively, if the Company so determines, the Company in exchange for
the Security shall issue and the Trustee shall authenticate a new Security that
reflects the changed terms.


 


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9.06         Trustee Protected.


The
Trustee need not sign any amendment, supplement or waiver authorized pursuant
to this Article IX
that adversely affects the Trustee’s rights, duties, liabilities or
immunities.  The Trustee shall be
entitled to receive and conclusively rely upon an Opinion of Counsel and an
Officers’ Certificate that any supplemental indenture, amendment or waiver is
permitted or authorized pursuant to the Indenture.


X.            CONVERSION


10.01       Conversion Privilege; Restrictive
Legends.


A
Holder of a Security may convert such Security into Common Stock at any time
during the period stated in paragraph 10 of the Securities upon the
satisfaction of the requirements set forth in paragraph 10 of the
Securities.  The initial Conversion Rate
is 49.6618 shares of Common Stock per $1,000 Principal Amount at Maturity.  The Conversion Rate is subject to adjustment
in accordance with Sections 10.06 through 10.12.


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


Any
shares issued upon conversion of a Security shall bear the Private Placement Legend
until after the second anniversary of the later of the Issue Date and the last
date on which the Company or any Affiliate was the owner of such shares or the
Security (or any predecessor security) from which such shares were converted
(or such shorter period of time as permitted by Rule 144(k) under the
Securities Act or any successor provision thereunder) (or such longer period of
time as may be required under the Securities Act or applicable state securities
laws in the Opinion of Counsel, unless otherwise agreed by the Company and the
Holder thereof).


10.02       Conversion Procedure.


To
convert a Security, a Holder must satisfy the requirements of paragraph 10
of the Securities.  The date on which
the Holder satisfies all those requirements is the conversion date.  As soon as practicable following 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 a check in lieu of any fractional share.  The person in whose name the certificate is
registered shall be treated as a stockholder of record on and after the
conversion date.


Except
as described below, no payment or adjustment will be made for accrued interest
on, or liquidated damages with respect to, a converted Security or for
dividends on any Common Stock issued on or prior to conversion.  If any Holder surrenders a Security for
conversion after the close of business on the record date for the payment of an
installment of interest and prior to the next succeeding interest payment date,
then, notwithstanding such conversion, the interest payable on such interest
payment date shall be paid to the Holder of such Security on such record date; provided,
however, that such Security, when surrendered for conversion, must
be 


 


-47-

















 


accompanied by payment to the Trustee on behalf of the Company of an
amount equal to the interest payable on such interest payment date on the
portion so converted; provided, further, however, that such
payment to the Trustee described in the immediately preceding proviso shall not
be required in connection with any conversion of a Security called for
Redemption pursuant to Section 3.04 hereof.


If
a Holder converts more than one Security at the same time, the number of full
shares 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 Trustee shall
authenticate for the Holder a new Security 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 is not a Legal Holiday.


10.03       Fractional Shares.


The
Company will not issue fractional shares of Common Stock upon conversion of
Securities and instead will deliver a check in an amount equal to the value of
such fraction computed on the basis of the Closing Sale Price.


10.04       Taxes on Conversion.


If
a Holder converts its 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 shares are issued in a name other
than the Holder’s name.


10.05       Company to Provide Stock.


The
Company shall reserve out of its authorized but unissued Common Stock or Common
Stock held in its treasury enough shares of Common Stock to permit the
conversion of all of the Securities.


All
shares of Common Stock which may be issued upon conversion of the Securities
shall be validly issued, fully paid and non-assessable and shall be free of
preemptive rights and free of any lien or adverse claim created by the Company.


The
Company shall comply with all securities laws regulating the offer and delivery
of shares of Common Stock upon conversion of Securities and shall list such
shares on each national securities exchange or automated quotation system on
which the Common Stock is listed.


 


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10.06       Adjustment of Conversion Rate.


The
Conversion Rate shall be subject to adjustment from time to time as follows:


(a)           In case the Company shall (1) pay a
dividend in shares of Common Stock to all holders of Common Stock, (2) make a
distribution in shares of Common Stock to all holders of Common Stock, (3)
subdivide the outstanding shares of Common Stock into a greater number of
shares of Common Stock or (4) combine the outstanding shares of Common Stock
into a smaller number of shares of Common Stock, the Conversion Rate in effect
immediately prior to such action 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 which he would have owned immediately
following such action had such Securities been converted immediately prior
thereto.  Any adjustment made pursuant
to this Section 10.06(a)
shall become effective immediately after the record date in the case of a
dividend or distribution and shall become effective immediately after the
effective date in the case of a subdivision or combination.


(b)           In case the Company shall issue
rights or warrants to all or substantially all holders of Common Stock, as the
case may be, entitling them, for a period commencing on the record date for the
determination of holders of Common Stock entitled to receive such rights or
warrants and expiring not more than sixty (60) days after such record date, to
subscribe for or purchase shares of Common Stock (or securities convertible
into Common Stock), at a price per share less than the then current market
price (as determined pursuant to Section 10.06(g)) of Common Stock on
such record date, the Conversion Rate shall be increased by multiplying the
Conversion Rate in effect immediately prior to such record date by a fraction
of which the numerator shall be the number of shares of Common Stock
outstanding on such record date, plus the
number of shares of Common Stock so offered for subscription or purchase, and
the denominator of which shall be the number of shares of Common Stock
outstanding at the close of business on such record date plus the number of
shares of Common Stock which the aggregate of the offering price of the total
number of shares of Common Stock so offered for subscription or purchase would
purchase at such current market price. 
Such adjustments shall become effective immediately after such record
date.


(c)           In case the Company shall dividend or
distribute to all or substantially all holders of Common Stock shares of
Capital Stock of the Company (other than Common Stock), evidences of
Indebtedness or other assets (other than cash dividends), or shall dividend or
distribute to all or substantially all holders of Common Stock rights or
warrants to subscribe for securities (other than those referred to in Section 10.06(b)),
then in each such case the Conversion Rate shall be increased by multiplying the Conversion Rate in effect immediately
prior to the close of business on the record date for the determination of
stockholders entitled to such distribution by a fraction of which the numerator
shall be the current market price of Common Stock (as determined pursuant to Section 10.06(g)), on such date and the denominator shall be such
current market price less the fair market value (as determined in good faith by
the Board of Directors whose determination shall be conclusive and described in
a Board Resolution) on such date of the portion of the evidences of
Indebtedness, shares of Capital Stock, cash and other assets to be


 


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distributed or of such subscription rights or warrants applicable to
one share of Common Stock, such increase to become effective immediately prior
to the opening of business on the day following such record date. 
Notwithstanding the foregoing, in the event that the Company shall
distribute rights or warrants (other than those referred to in Section 10.06(b))
(“Rights”)
pro rata
to holders of Common Stock, the Company may, in lieu of making any adjustment
pursuant to this Section 10.06(c), make proper provision so that each
Holder of a Security who converts such Security (or any portion thereof) after
the record date for such distribution and prior to the expiration or redemption
of the Rights shall be entitled to receive upon such conversion, in addition to
the shares of Common Stock issuable upon such conversion (the “Conversion
Shares”), a number of Rights to be determined as follows:  (i) if such conversion occurs on or prior to
the date for the distribution to the holders of Rights of separate certificates
evidencing such Rights (the “Distribution Date”), the same number of
Rights to which a holder of a number of shares of Common Stock equal to the
number of shares of Conversion Shares is entitled at the time of such
conversion in accordance with the terms and provisions of and applicable to the
Rights; and (ii) if such conversion occurs after the Distribution Date, the
same number of Rights to which a holder of the number of shares of Common Stock
into which the principal amount of the Security so converted was convertible
immediately prior to the Distribution Date would have been entitled on the
Distribution Date in accordance with the terms and provisions of and applicable
to the Rights.  In the event that the
Company implements a stockholders’ rights plan after the date hereof, the
Company shall provide that the Holders will receive, in addition to Common
Stock, the rights described therein upon conversion of the Securities (whether
or not the rights have separated from the Common Stock prior to the time of
conversion), subject to the limitations set forth in the stockholders’ rights
plan.  Any distribution of rights or
warrants pursuant to a stockholders’ rights plan complying with the requirements
set forth in the two preceding sentences shall not constitute a distribution of
rights or warrants pursuant to this Section 10.06(c).


(d)           In case the Company shall, by
dividend or otherwise, at any time make a distribution of cash (excluding any
cash that is distributed as part of a distribution requiring a Conversion Rate
adjustment pursuant to subsection (e) below) to all or
substantially all holders of Common Stock, the Conversion Rate shall be
increased by multiplying the Conversion Rate in effect immediately prior to the close of business on the record date for the
determination of holders of Common Stock entitled to such distribution by a fraction (A)
whose numerator shall be the current market price per share of Common Stock (as
determined pursuant to Section 10.06(g)) on such record date
and (B) whose denominator shall be an amount equal to (a) such current market
price per share of Common Stock less (b) the lesser of (i) the amount of the distribution per share of
Common Stock and (ii) such current market price per share of Common
Stock; provided,
however,
that the Conversion Rate shall not be adjusted pursuant to this Section
10.06(d) to the extent, and only to the extent, such adjustment
would cause the Conversion Price to be less than one cent ($0.01); provided
further that, if the denominator of such fraction shall be zero, the
Conversion Rate shall be instead adjusted so that the Conversion Price is equal
to one cent ($0.01).  An adjustment to
the Conversion Rate pursuant to this Section 10.06(d) shall become effective immediately prior to the opening of business on
the day immediately following such record date.


 


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(e)           In case the Company or any Subsidiary
shall distribute cash or other consideration in respect of a tender offer or
exchange offer made by the Company or any Subsidiary for all or any portion of
the Common Stock where the sum of the aggregate amount of such cash distributed
and the aggregate fair market value (as determined in good faith by the Board
of Directors, whose determination shall be conclusive and set forth in a Board
Resolution), as of the Expiration Date (as defined below), of such other
consideration distributed (such sum, the “Aggregate Amount”) expressed as an amount
per share of Common Stock validly tendered or exchanged, and not withdrawn,
pursuant to such tender offer or exchange offer as of the Expiration Time (as
defined below) (such tendered or exchanged shares of Common Stock, the “Purchased
Shares”) exceeds the current market price per share of Common Stock
(as determined pursuant to Section 10.06(g)) on the trading day
next succeeding the last date (such last date, the “Expiration Date”) on which
tenders or exchanges could have been made pursuant to such tender offer or
exchange offer (as the same may be amended through the Expiration Date), then
the Conversion Rate shall be increased by multiplying the Conversion Rate in
effect immediately prior to the close of business on the Expiration Date by a fraction
(A) whose numerator is equal to the sum of (I) the Aggregate Amount and (II)
the product of (a) the current market price per share of Common Stock on the
Expiration Date and (b) an amount equal to (i) the number of shares of Common
Stock outstanding as of last time (the “Expiration Time”) at which tenders or
exchanges could have been made pursuant to such tender offer or exchange offer
less (ii) the Purchased Shares and (B) whose denominator is equal to the
product of (I) the number of shares of Common Stock outstanding as of the
Expiration Time (including all Purchased Shares) and (II) the current market
price per share of Common Stock on the Expiration Date.


An
adjustment, if any, to the Conversion Rate pursuant to this Section
10.06(e) shall become effective immediately prior to the opening of
business on the Business Day following the Expiration Date.  In the event that the Company or a
Subsidiary is obligated to purchase shares of Common Stock pursuant to any such
tender offer or exchange offer, but the Company or such Subsidiary is
permanently prevented by applicable law from effecting any such purchases, or
all such purchases are rescinded, then the Conversion Rate shall again be
adjusted to be the Conversion Rate which would then be in effect if such tender
offer or exchange offer had not been made. 
If the application of this Section 10.06(e) to any tender offer
or exchange offer would result in a decrease in the Conversion Rate, no
adjustment shall be made for such tender offer or exchange offer under this Section 10.06(e).


 


(f)            In addition to the foregoing
adjustments in subsections (a), (b), (c), (d)  and  (e) above, the Company, from time to time
and to the extent permitted by law, may increase the Conversion Rate by any
amount for at least twenty (20) days or such longer period as may be required
by law, if the Board of Directors has made a determination, which determination
shall be conclusive, that such increase would be in the best interests of the
Company, provided that the then effective Conversion Price is not less than the
par value of a share of Common Stock. 
The Company shall give notice to the Trustee and cause notice of such
increase to be mailed to each Holder of Securities at such Holder’s address as
the same appears on the registry books of the Registrar, at least fifteen (15) 


 


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days prior to the date on
which such increase commences.  Such
Conversion Rate increase shall be irrevocable during such period.


(g)           For the purpose of any computation
under subsections
(a), (b), (c), (d)  and  (e) above, the current market price per
share of Common Stock on the date fixed for determination of the stockholders
entitled to receive the issuance or distribution requiring such computation
(the “Determination
Date”) shall be deemed to be the average of the Closing Sale Prices
for the ten (10) consecutive Trading Days immediately preceding the
Determination Date; provided, however, that (i) if
the “ex” date for any event (other than the issuance or distribution requiring
such computation) that requires an adjustment to the Conversion Rate pursuant
to subsection
(a), (b), (c), (d)  or  (e) above occurs on or after the tenth
(10th) Trading Day prior to the Determination Date and prior to the “ex” date
for the issuance or distribution requiring such computation, the Closing Sale
Price for each Trading Day prior to the “ex” date for such other event shall be
adjusted by multiplying such Closing Sale Price by the reciprocal of the
fraction by which the Conversion Rate is so required to be adjusted as a result
of such other event, (ii) if the “ex” date for any event (other than the
issuance or distribution requiring such computation) that requires an
adjustment to the Conversion Rate pursuant to subsection (a), (b),
(c),
(d)
or
(e)
above occurs on or after the “ex” date for the issuance or distribution
requiring such computation and on or prior to the Determination Date, the
Closing Sale Price for each Business Day on and after the “ex” date for such
other event shall be adjusted by multiplying such Closing Sale Price by the
same fraction by which the Conversion Rate is so required to be adjusted as a
result of such other event, and (iii) if the “ex” date for the issuance or
distribution requiring such computation is on or prior to the Determination
Date, after taking into account any adjustment required pursuant to clause (i)
or (ii) of this proviso, the Closing Sale Price for each Trading Day
on and after the “ex” date shall be adjusted by adding thereto the amount of
any cash and the fair market value (as determined in good faith by the Board of
Directors in a manner consistent with any determination of such value for the
purposes of this Section 10.06, whose determination shall be conclusive and
described in a Resolution of the Board of Directors) of the evidences of
Indebtedness, shares of Capital Stock or other securities or assets being
distributed (in the distribution requiring such computation) applicable to one
share of Common Stock as of the close of business on the day before such “ex”
date.  For the purpose of any
computation under subsection (e) of this Section
10.06, the current market price per share of Common Stock at the
expiration date for the tender offer or exchange offer requiring such computation
shall be deemed to be the average of the Closing Sale Price for the ten (10)
consecutive Trading Days immediately preceding the Expiration Date; provided,
however,
that if the “ex” date for any event (other than the tender offer requiring such
computation) that requires an adjustment to the Conversion Rate pursuant to subsection
(a), (b), (c), (d)  or  (e) above occurs on or after the expiration
time for the tender offer or exchange offer requiring such computation and
prior to the day in question, the Closing Sale Price for each Trading Day on or
after to the “ex” date for such other event shall be adjusted by multiplying
such Closing Sale Price by the same fraction by which the Conversion Rate is so
required to be adjusted as a result of such other event.  For purposes of this subsection, the term
“ex” date, (i) when used with respect to any issuance or distribution,
means the first date on which the Common Stock trades regular way on the
relevant exchange or in the relevant market from which the 


 


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Closing Sale Price
was obtained without the right to receive such issuance or distribution,
(ii) when used with respect to any subdivision or combination of shares of
Common Stock, means the first date on which the Common Stock trades regular way
on such exchange or in such market after the time at which such subdivision or
combination becomes effective, and (iii) when used with respect to any
tender offer means the first date on which the Common Stock trades regular way
on such exchange or in such market after the expiration time of such tender
offer (as it may be amended or extended).


10.07       No Adjustment.


No
adjustment in the Conversion Rate shall be required until cumulative
adjustments amount to one percent (1%) or more of the Conversion Price as last
adjusted; provided,
however, that any adjustments which by reason of this Section 10.07
are not required to be made shall be carried forward and taken into account in
any subsequent adjustment.  All calculations
under this Article X shall be made to the nearest cent or to the
nearest one-hundredth of a share, as the case may be.


If
any rights, options or warrants issued by the Company as described in Section
10.06 are only exercisable upon the occurrence of certain triggering
events, then the Conversion Rate will not be adjusted as provided in Section
10.06 until the earliest of such triggering event occurs.  Upon the expiration or termination of any
rights, options or warrants without the exercise of such rights, options or
warrants, the Conversion Rate then in effect shall be adjusted immediately to
the Conversion Rate which would have been in effect at the time of such
expiration or termination had such rights, options or warrants, to the extent
outstanding immediately prior to such expiration or termination, never been
issued.


No
adjustment need be made for a transaction referred to in this Article X
if Securityholders are to participate in the transaction without conversion on
a basis and with notice that the Board of Directors determines to be fair and
appropriate in light of the basis and notice on which holders of Common Stock
participate in the transaction.


10.08       Other Adjustments.


In
the event that, as a result of an adjustment made pursuant to Section 10.06
hereof, the Holder of any Security thereafter surrendered for conversion shall
become entitled to receive any shares of Capital Stock other than shares of
Common Stock, thereafter the Conversion Rate of such other shares so receivable
upon conversion of any Security shall be subject to adjustment from time to
time in a manner and on terms as nearly equivalent as practicable to the
provisions with respect to Common Stock contained in this Article X.


10.09       Adjustments for Tax Purposes.


The
Company may make such increases in the Conversion Rate, in addition to those
required by Section 10.06 hereof, as it determines to be advisable in
order that any stock dividend, subdivision of shares, distribution or rights to
purchase stock or securities or distribution of securities convertible into or
exchangeable for stock made by the Company to its stockholders will not be
taxable to the recipients thereof.


 


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10.10       Notice of Adjustment.


Whenever
the Conversion Rate is adjusted, the Company shall promptly mail to Holders at
the addresses appearing on the Registrar’s books a notice of the adjustment and
file with the Trustee an Officers’ Certificate briefly stating the facts
requiring the adjustment and the manner of computing it.  The certificate shall be conclusive evidence
of the correctness of such adjustment.


10.11       Notice of Certain Transactions.


In
the event that:


(1)           the
Company takes any action which would require an adjustment in the Conversion
Rate;


(2)           the Company takes any action that
would require a supplemental indenture pursuant to Section 10.12; or


(3)           there is a dissolution or liquidation
of the Company,


a
Holder of a Security may wish to convert such Security into shares of Common
Stock prior to the record date for or the effective date of the transaction so
that such Holder may receive the rights, warrants, securities or assets which a
holder of shares of Common Stock on that date may receive.  Therefore, the Company shall mail to Holders
at the addresses appearing on the Registrar’s books and the Trustee a notice
stating the proposed record or effective date, as the case may be, of any
transaction referred to in clause (1), (2) or (3) of this Section 10.11.  The Company shall mail such notice at least
fifteen (15) days before such date; however, failure to mail such notice or any
defect therein shall not affect the validity of any transaction referred to in clause (1),
(2)
or (3)
of this Section 10.11.


10.12       Effect of Reclassifications,
Consolidations, Mergers, Binding Share Exchanges or Sales on Conversion
Privilege.


If
any of the following shall occur, namely: (i) any reclassification or change in
the Common Stock issuable upon conversion of Securities (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 binding share exchange to which the Company is a party other than a
merger in which the Company is the continuing corporation and which does not
result in any reclassification of, or change (other than a change in name, or
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) in, the Common Stock, or (iii)
any sale or conveyance of all or substantially all of the property or business
of the Company, then the Company or such successor or purchasing corporation,
as the case may be, shall, as a condition precedent to such reclassification,
change, consolidation, merger, binding share exchange, sale or conveyance,
execute and deliver to the Trustee a supplemental indenture in form reasonably
satisfactory to the Trustee providing that the Holder of each Security then
outstanding shall have the right to convert such Security into the kind and
amount of shares of stock and other securities and property (including cash)
receivable upon such reclassification, change, consolidation, merger, binding
share exchange, sale or 


 


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conveyance by a holder of the number of shares of Common Stock,
deliverable upon conversion of such Security immediately prior to such
reclassification, change, consolidation, merger, binding share exchange, sale
or conveyance, assuming that such Holder would not have exercised any rights of
election that the Holder would have had as a holder of Common Stock to select a
particular type of consideration.  Such
supplemental indenture shall provide for adjustments of the Conversion Rate
which shall be as nearly equivalent as may be practicable to the adjustments of
the Conversion Rate provided for in this Article X.  The foregoing, however, shall not in any way affect the right a
Holder of a Security may otherwise have, pursuant to clause (ii) of the last
sentence of the first paragraph of Section 10.06(c) hereof, to receive
Rights upon conversion of a Security. 
If, in the case of any such consolidation, merger, binding share
exchange, sale or conveyance, the stock or other securities and property
(including cash) receivable thereupon by a holder of Common Stock includes
shares of stock or other securities and property of a corporation other than
the successor or purchasing corporation, as the case may be, in such
consolidation, merger, binding share exchange, sale or conveyance, then such
supplemental indenture shall also be executed by such other corporation and
shall contain such additional provisions to protect the interests of the Holders
of the Securities as the Board of Directors shall reasonably consider necessary
by reason of the foregoing.  The
provision of this Section 10.12 shall similarly apply to
successive consolidations, mergers, binding share exchanges, sales or conveyances.


In
the event the Company shall execute a supplemental indenture pursuant to this Section 10.12,
the Company shall promptly file with the Trustee an Officers’ Certificate
briefly stating the reasons therefor, the kind or amount of shares of stock or
securities or property (including cash) receivable by Holders of the Securities
upon the conversion of their Securities after any such reclassification,
change, consolidation, merger, binding share exchange, sale or conveyance and
any adjustment to be made with respect thereto.


10.13       Trustee’s Disclaimer.


The
Trustee has no duty to determine when an adjustment under this Article X
should be made, how it should be made or what such adjustment should be, but
may accept as conclusive evidence of the correctness of any such adjustment,
and shall be protected in relying upon the Officers’ Certificate with respect
thereto which the Company is obligated to file with the Trustee pursuant to Section 10.10
hereof.  The Trustee makes no
representation as to the validity or value of any securities or assets issued
upon conversion of Securities, and the Trustee shall not be responsible for the
failure by the Company to comply with any provisions of this Article X.


The
Trustee shall not be under any responsibility to determine the correctness of
any provisions contained in any supplemental indenture executed pursuant to Section 10.12,
but may accept as conclusive evidence of the correctness thereof, and shall be
protected in relying upon, the Officers’ Certificate with respect thereto which
the Company is obligated to file with the Trustee pursuant to Section 10.12
hereof.


 


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XI.           SUBORDINATION


11.01       Agreement to Subordinate.


The
Company agrees, and each Securityholder by accepting a Security agrees, that
the payment of all amounts due with respect to the Securities (except as set
forth in this Article XI with respect to Permitted Payments) is subordinated
in right of payment, to the extent and in the manner provided in this Article XI,
to the prior payment in full in cash or cash equivalents of all Senior
Indebtedness (whether outstanding on the date hereof or hereafter created,
incurred, assumed or guaranteed) and that the subordination is for the benefit
of the holders of Senior Indebtedness.


11.02       Certain Definitions.


“Designated
Senior Indebtedness” means any Senior Indebtedness in which the
instrument creating or evidencing the Indebtedness expressly provides that such
Indebtedness is “designated senior indebtedness.”


“Indebtedness”
means, with respect to any person, the principal of, and premium, if any, and
interest on and all other obligations in respect of (a) all indebtedness of
such person for borrowed money (including all indebtedness evidenced by notes,
bonds, debentures or other securities), (b) all obligations (other than trade
payables) incurred by such person in the acquisition (whether by way of
purchase, merger, consolidation or otherwise and whether by such person or
another person) of any business, real property or other assets, (c) all
reimbursement obligations of such person with respect to letters of credit,
bankers’ acceptances or similar facilities issued for the account of such
person, (d) all of such person’s capital lease obligations and obligations under
facility leases between such person as lessee and a subsidiary of such person
as lessor, (e) all net obligations of such person under interest rate swap,
currency exchange or similar agreements to which such person is a party, (f)
all obligations and other liabilities, contingent or otherwise, under any lease
or related document, including a purchase agreement, conditional sale or other
title retention agreement, in connection with the lease of real property or
improvements thereon (or any personal property included as part of any such
lease) which provides that such person is contractually obligated to purchase
or cause a third party to purchase the leased property or pay an agreed-upon
residual value of the leased property, including such person’s obligations
under such lease or related document to purchase or cause a third party to
purchase such leased property or pay an agreed-upon residual value of the
leased property to the lessor, (g) guarantees by such person of indebtedness
described in clauses (a) through (f) of another person and pledges of any of such person’s assets as security for another person’s
indebtedness, and (h) all renewals, extensions, refundings,
deferrals, restructurings, amendments and modifications of any indebtedness,
obligation, guarantee, pledge or liability of the kind described in clauses (a)
through (g).


“Representative”
means the indenture trustee or other trustee, agent or representative for an
issue of Senior Indebtedness.


“Senior
Indebtedness” means all Indebtedness of the Company outstanding at
any time, except the Securities, Indebtedness that by its terms provides that
it shall not be “senior” in right 


 


 


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of payment to the Securities or Indebtedness that by its terms provides
that it shall be “pari passu” or “junior” in right of payment to the
Securities.  Senior Indebtedness does
not include Indebtedness for trade payables or any account payable or other
accrued current liability or obligation incurred in the ordinary course of
business in connection with the obtaining of materials or services.  In addition, Senior Indebtedness does not
include Indebtedness of the Company to any of the Subsidiaries, except for
amounts due by the Company to Fremont Holding L.L.C., a Delaware limited
liability company, under that certain Lease between the Company and Fremont
Holding L.L.C., dated September 9, 1999.


11.03       Liquidation; Dissolution; Bankruptcy.


In
the event of any insolvency or bankruptcy case or proceeding, or any receivership,
liquidation, reorganization or other similar case or proceeding in connection
therewith, relating to the Company or to its assets, or any liquidation,
dissolution or other winding-up of the Company, whether voluntary or
involuntary, or any assignment for the benefit of creditors or other marshaling
of assets or liabilities of the Company (except in connection with the
consolidation or merger of the Company or its liquidation or dissolution
following the conveyance, transfer or lease of its properties and assets
substantially upon the terms and conditions described in Article V),
the holders of Senior Indebtedness will be entitled to receive payment in full
in cash or cash equivalents of all Senior Indebtedness, or provision shall be
made for such payment in full, before the Securityholders will be entitled to
receive any payment or distribution of any kind or character on account of
principal of, or premium, if any, or interest or liquidated damages on the
Securities (except for Permitted Payments); and any payment or distribution of
assets of the Company of any kind or character, whether in cash, property or
securities, by set-off or otherwise, to which the Securityholders or the
Trustee would be entitled but for the provisions of this Article XI (except for
Permitted Payments) shall be paid by the liquidating trustee or agent or other
person making such payment or distribution, whether a trustee in bankruptcy, a
receiver or liquidating trustee or otherwise, directly to the holders of Senior
Indebtedness or their Representative or Representatives ratably according to
the aggregate amounts remaining unpaid on account of the Senior Indebtedness to
the extent necessary to make payment in full of all Senior Indebtedness
remaining unpaid, after giving effect to any concurrent payment or distribution
to the holders of such Senior Indebtedness.


11.04       Default on Designated Senior Indebtedness


No
payment or distribution, other than Permitted Payments, of any assets of the
Company of any kind or character, whether in cash, property or securities, may
be made by or on behalf of the Company on account of the principal of, or
premium, if any, or interest on the Securities or on account of the purchase,
redemption or other acquisition of Securities, upon the occurrence of any
Payment Default in respect of Designated Senior Indebtedness until such Payment
Default shall have been cured or waived in writing or shall have ceased to
exist or such Designated Senior Indebtedness shall have been discharged or paid
in full in cash or cash equivalents.  A
“Payment
Default” shall mean a default in payment, whether at scheduled
maturity, upon a scheduled installment, by acceleration or otherwise, of
principal of, or premium, if any, or interest on Designated Senior Indebtedness
beyond any applicable grace period.


 


 


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No payment or distribution, other than Permitted Payments, of any
assets of the Company of any kind or character, whether in cash, property or
securities, may be made by or on behalf of the Company on account of principal
of, or premium, if any, or interest on the Securities or on account of the
purchase, redemption or other acquisition of Securities for the period
specified below (a “Payment Blockage Period”), upon the occurrence
of any default or event of default with respect to any Designated Senior
Indebtedness, other than a Payment Default, pursuant to which the maturity
thereof may be accelerated (a “Non-Payment Default”) and receipt by the Trustee
of written notice thereof from the Company or a Representative with respect to
such Designated Senior Indebtedness (a “Payment Blockage Notice”).


The
Payment Blockage Period shall mean the period (each a “Payment Blockage Period”)
that shall commence upon receipt by the Trustee of the Payment Blockage Notice,
and shall end on the earliest of:


(i)
one hundred seventy nine (179) days thereafter, (provided that any Designated
Senior Indebtedness to which the Non-Payment Default relates shall not
theretofore have been accelerated);


(ii)
the date on which such Non-Payment Default is cured, waived or ceases to exist;


(iii)
the date on which such Designated Senior Indebtedness is discharged or paid in
full; or


(iv)
the date on which such Payment Blockage Period shall have been terminated by
written notice to the Trustee from the Representative initiating such Payment
Blockage Period, after which the Company will resume making any and all
required payments in respect of the Securities, including any missed payments.  In any event, not more than one Payment
Blockage Period may be commenced during any period of three hundred and sixty
five (365) consecutive days.  No
Non-Payment Default that existed or was continuing on the date of the
commencement of any Payment Blockage Period will be, or can be made, the basis
for the commencement of a subsequent Payment Blockage Period, unless such
Non-Payment Default has been cured or waived for a period of not less than
ninety (90) consecutive days subsequent to the commencement of such initial Payment
Blockage Period.


                Notwithstanding anything to the
contrary contained herein, nothing shall prevent any payment to Securityholders
permitted by the Pledge Agreement from the Pledge Account or or permitted by Article XII.


11.05       Acceleration of Securities.


If
payment of the Securities is accelerated because of an Event of Default, the
Company shall promptly notify holders of Senior Indebtedness of the
acceleration.


11.06       When Distribution Must Be Paid Over.


In
the event that, notwithstanding the provisions of Sections 11.03 and 11.04, any
payment or distribution of any kind or character, whether in cash, property or
securities, shall be received by the Trustee or any Holder which is prohibited
by such provisions, then and in such 


 


 


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event such payment shall be held in trust for the benefit of, and shall
be paid over and delivered by such Trustee or Holder to, the trustee or
Representative with respect to holders of Senior Indebtedness, as their
interest may appear, for application to Senior Indebtedness remaining unpaid
until all such Senior Indebtedness has been paid in full in cash or cash
equivalents after giving effect to any concurrent distribution to or for the
holders of Senior Indebtedness.


With
respect to the holders of Senior Indebtedness, the Trustee undertakes to
perform only such obligations on the part of the Trustee as are specifically
set forth in this Article XI, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. 
The Trustee shall not be deemed to owe any fiduciary duty to the holders
of Senior Indebtedness, and shall not be liable to any such holders if the
Trustee shall pay over or distribute to or on behalf of Holders or the Company
or any other person money or assets to which any holders of Senior Indebtedness
shall be entitled by virtue of this Article XI, except if such payment is made
as a result of the willful misconduct or negligence of the Trustee.


11.07       Notice by the Company.


The
Company shall promptly notify the Trustee and the Paying Agent of any facts
known to the Company that would cause a payment of any obligations with respect
to the Securities to violate this Article XI, but failure to give such notice
shall not affect the subordination of the Securities to the Senior Indebtedness
as provided in this Article XI.


11.08       Subrogation.


After
all Senior Indebtedness is paid in full and until the Securities are paid in
full, Securityholders shall be subrogated (equally and ratably with all other
Indebtedness that is equal in right of payment to the Securities) to the rights
of holders of Senior Indebtedness to receive distributions applicable to Senior
Indebtedness to the extent that distributions otherwise payable to the
Securityholders have been applied to the payment of Senior Indebtedness.  A distribution made under this Article XI,
to holders of Senior Indebtedness that otherwise would have been made to
Securityholders is not, as between the Company and Securityholders a payment by
the Company of the Securities.


11.09       Relative Rights.


This
Article
XI, defines the relative rights of Holders and holders of Senior
Indebtedness.  Nothing in this Indenture
shall:  (i) impair, as between the Company
and Holders, the obligation of the Company, which is absolute and
unconditional, to pay principal of and interest on the Securities in accordance
with their terms; (ii) affect the relative rights of Holders and creditors of
Holders other than their rights in relation to holders of Senior Indebtedness;
or (iii) prevent the Trustee or any Holder from exercising its available
remedies upon a Default or Event of Default, subject to the rights of holders
and owners of Senior Indebtedness to receive distributions and payments
otherwise payable to Holders of Securities. 
If the Company fails because of this Article XI, to pay principal
of or interest on a Security on the Maturity Date, the failure is still a
Default or Event of Default.


 


 


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11.10       Subordination May Not Be Impaired by the
Company.


No
right of any holder of Senior Indebtedness to enforce the subordination of the
Indebtedness evidenced by the Securities shall be impaired by any act or
failure to act by the Company or any Holder or by the failure of the Company or
any Holder to comply with this Indenture.


Without
in any way limiting the generality of this Section 11.10, the holders of Senior
Indebtedness may, at any time and from time to time, without the consent of or
notice to the Trustee or the Holders, without incurring responsibility to the
Trustee or the Holders and without impairing or releasing the subordination
provided in this Article XI, or the obligations hereunder of the Holders to the
holders of Senior Indebtedness, do any one or more of the following: (a) change
the manner, place or terms of payment or extend the time of payment of, or
renew or alter, Senior Indebtedness, or any instrument evidencing the same or
any agreement under which Senior Indebtedness is outstanding or secured; (b)
sell, exchange, release, foreclose against or otherwise deal with any property
pledged, mortgaged or otherwise securing Senior Indebtedness; (c) release any
person liable in any manner for the collection of Senior Indebtedness; and (d)
exercise or refrain from exercising any rights against the Company, and
Subsidiary thereof or any other person.


11.11       Distribution or Notice to Representative.


Whenever
a distribution is to be made or a notice given to holders of any Senior
Indebtedness, the distribution may be made and the notice given to their
trustee or Representative.


Upon
any payment or distribution of assets of the Company referred to in this Article XI,
the Trustee and the Holders the Securities shall be entitled to rely upon any
order or decree made by any court of competent jurisdiction or upon any
certificate of such representative(s) or of the liquidating trustee or agent or
other Person making any distribution to the Trustee or to the Holders for the
purpose of ascertaining the Persons entitled to participate in such
distribution, all holders of the Senior Indebtedness and other Indebtedness of
the Company, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to this Article XI.


11.12       Rights of Trustee and Paying Agent.


Notwithstanding
the provisions of this Article XI, or any other provision of this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts that would prohibit the making of any payment or distribution by the
Trustee, and the Trustee and the Paying Agent may continue to make payments on
the Securities, unless a Responsible Officer of the Trustee shall have received
at its Corporate Trust Office of the Trustee at least three (3) Business Days
prior to the date of such payment written notice of facts that would cause the
payment of any obligations with respect to the Securities to violate this Article XI.  Only the Company or a trustee or
Representative with respect to Senior Indebtedness may give the notice.  Nothing in this Article XI, shall impair the
claims of, or payments to, the Trustee under or pursuant to Section 7.07.


 


 


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The Trustee in its individual or any other capacity may hold Senior
Indebtedness with the same rights it would have if it were not Trustee.


XII.         SECURITY


12.01       Security.


On
the date hereof, the Company shall (i) duly execute and deliver the Pledge
Agreement and comply with the terms and provisions thereof; and (ii) purchase
the Pledged Security Entitlements to be pledged to the Trustee for the benefit
of the Holders in such amount as will be sufficient upon receipt of scheduled
interest and/or principal payments on such Pledged Security Entitlements to
provide for payment in full of the first six (6) scheduled interest payments on
the Securities when due.  The Pledged
Security Entitlements shall be pledged by the Company to the Trustee for the
ratable benefit of the Holders and shall be held by the Trustee in the Pledge
Account pending disposition pursuant to the Pledge Agreement.


12.02       Pledge Agreement.


Each
Holder, by its acceptance of a Security, consents and agrees to the terms of
the Pledge Agreement (including, without limitation, the provisions providing
for foreclosure and release of the Pledged Financial Assets) as the same may be
in effect or may be amended from time to time in accordance with its terms, and
each Holder authorizes and directs the Trustee to enter into the Pledge
Agreement and to perform its respective obligations and exercise its respective
rights thereunder in accordance therewith. 
The Company shall do or cause to be done all such acts and things as may
be necessary or reasonably requested by the Trustee, or as may be required by
the provisions of the Pledge Agreement, to assure and confirm to the Trustee
the security interest in the Pledged Financial Assets contemplated hereby, or
by the Pledge Agreement, as the same may be in effect from time to time, so as
to render the Pledged Financial Assets available for the security and benefit
of this Indenture and of the Securities secured thereby, according to the
intent and purposes herein and therein expressed.  The Company shall take, or shall cause to be taken, upon request
of the Trustee, any and all actions reasonably required to cause the Pledge
Agreement to create and maintain, as security for the obligations of the
Company under this Indenture and the Securities, valid and enforceable
first-priority liens in and on all the Pledged Financial Assets, in favor of
the Trustee, superior and prior to the rights of third Persons and subject to
no other Liens.


12.03       Release of Pledged Financial Assets.


The
release of any Pledged Financial Assets pursuant to the Pledge Agreement shall
not be deemed to impair the security under this Indenture in contravention of
the provisions hereof if and to the extent such Pledged Financial Assets are
released in accordance with this Indenture and the Pledge Agreement.  To the extent applicable, the Company shall
cause TIA § 314(d) relating to the release of property or securities from
the Lien and security interest of the Pledge Agreement and relating to the substitution
therefor of any property or securities to be subjected to the Lien and security
interest of the Pledge Agreement to be complied with.  Any certificate or opinion required by TIA § 314(d) may be
made by an Officer, except in cases where TIA 


 


-61-

















§ 314(d) requires that such certificate or opinion be made by an
independent Person, which Person shall be an independent engineer, appraiser or
other expert selected by the Company.


12.04       Disbursements From Pledge Account Upon
Conversion or Repurchase.


If,
prior to the payment of the sixth (6th) scheduled interest payment due on the
Securities, any Securities are converted in accordance with this Indenture or
any Securities are repurchased by the Company, then, upon the written request
of the Company to the Trustee and satisfaction of the conditions precedent
specified in this Section 12.04, the Trustee shall promptly
instruct the Account Intermediary (as defined in the Pledge Agreement) to
liquidate Collateral (as defined in the Pledge Agreement) to the extent (but
only to the extent) necessary to generate an amount of cash proceeds equal to
the Release Amount (as defined below) and shall distribute to the Company (such
distribution, a “Release Distribution”) such amount in immediately available
funds.  Upon each Release Distribution,
the Trustee shall release the security interest and continuing lien in that
portion of the Collateral, and proceeds derived therefrom, distributed to the
Company pursuant to such Release Distribution, and shall execute such documents
as the Company may reasonably request to evidence such release.  No Release Distribution or liquidation to
facilitate a Release Distribution shall occur unless all of the following shall
have been satisfied:


(A)          the Company has delivered to the Trustee
an Opinion of Counsel to the effect that (i) the Securities referred to in the
above paragraph have been duly converted or repurchased by the Company and (ii)
all conditions precedent to the Release Distribution have been satisfied;


(B)           the Company has delivered to the
Trustee an Officers’ Certificate that (i) identifies the Securities that have
been so converted or so repurchased, (ii) affirms that such Securities have
been duly converted or repurchased, (iii) states that all conditions precedent
relating to the Release Distribution have been satisfied and (iv) states the
Release Amount;


(C)           the Company has delivered to the
Trustee a Written Independent Accountant Report (as defined in the Pledge
Agreement) stating that the Collateral to be remaining after the proposed
Release Distribution and related liquidation of Collateral will be sufficient,
upon receipt of the scheduled interest and principal payments on the remaining
Pledged Financial Assets, to provide for payment in full of the remaining first
six (6) scheduled interest payments on the Remaining Securities (as defined
below) when due;


(D)          no Event of Default has occurred and
is continuing;


(E)           no Event (as defined in the
Registration Rights Agreement) has occurred and is continuing; and


(F)           no Securities that have been
repurchased by the Company have subsequently been resold.


“Release Amount” shall mean an
amount equal to the net proceeds (after deducting expenses related in any way
to the related Release Distribution and liquidation of Collateral) from the
liquidation of that portion of the Collateral not necessary to remain in the
Pledge Account in order to provide, from the receipt of the scheduled interest
and principal payments on


 


-62-

















 


the
remaining Pledged Financial Assets, for payment in full of the remaining first
six (6) scheduled interest payments on the Remaining Securities when due.


“Remaining
Securities” shall mean the Securities other than the Securities
specified in the Officers’ Certificate referred to in this Section 12.04 as having been
converted or repurchased.


12.05       Opinions of Counsel.


The
Company shall cause TIA § 314(b), relating to opinions of counsel
regarding the Lien under the Pledge Agreement, to be complied with.  The Trustee may accept, to the extent
permitted by Sections 4.04 and 7.06 as conclusive evidence of compliance
with the foregoing provisions, the appropriate statements contained in such
opinions.


12.06       Authorization of Actions to be Taken by
the Trustee Under the Pledge Agreement.


On
behalf of the Holders, the Trustee may, in its sole discretion and without the
consent of the Holders, take all reasonable actions in accordance with the
Pledge Agreement necessary or appropriate in order to (A) enforce any of the
terms of the Pledge Agreement or (B) collect and receive any and all amounts
payable in respect of the obligations of the Company thereunder.  The Trustee shall have the power to
institute and to maintain such suits and proceedings as the Trustee may reasonably
deem expedient to preserve or protect its interests and the interests of the
Holders in the Pledged Financial Assets (including the power to institute and
maintain suits or proceedings to restrain the enforcement of, or compliance
with, any legislative or other governmental enactment, rule or order that may
be unconstitutional or otherwise invalid if the enforcement of, or compliance
with, such enactment, rule or order would impair the security interest
hereunder or be prejudicial to the interests of the Holders or of the Trustee).


XIII.        MISCELLANEOUS


13.01       Trust Indenture Act Controls.


If
any provision of this Indenture limits, qualifies or conflicts with another
provision which is required to be included in this Indenture by the TIA, the
required provision of the TIA shall control.


13.02       Notices.


Any
notice or communication by the Company or the Trustee to one or both of the
others is duly given if in writing and delivered in person, mailed by
first-class mail or by express delivery or by telecopy, with written
confirmation of transmittal, to the other parties’ addresses stated in this Section 13.02.  The Company or the Trustee by notice to the
others may designate additional or different addresses for subsequent notices
or communications.


 


-63-

















Any notice or communication to a Securityholder shall be mailed to its
address shown on the register kept by the Registrar.  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 the addressee receives it.


If
the Company mails a notice or communication to Securityholders, it shall mail a
copy to the other and to the Trustee and each Agent at the same time.


All
notices or communications shall be in writing.


The Company’s address is:


Protein Design Labs, Inc.


34801 Campus Drive


Fremont, California 94555


 


For
purposes of Section 4.02 only, the Trustee’s address is:


c/o JPMorgan Chase Bank


Institutional Trust Services


4 New York Plaza


1st Floor


New
York, New York 10004


For
all purposes other than Section 4.02, the Trustee’s address is:


J.P.
Morgan Trust Company, National Association


560
Mission Street, 13th Floor


San
Francisco, CA 94105


Attention: Mitch Gardner


13.03       Communication by Holders with Other
Holders.


Securityholders
may communicate pursuant to TIA § 312(b) with other Securityholders with
respect to their rights under this Indenture or the Securities.  The Company, the Trustee, the Registrar and
anyone else shall have the protection of TIA § 312(c).


13.04       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:


(i)         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


 


-64-

















 


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


Each
signer of an Officers’ Certificate or an Opinion of Counsel may (if so stated)
rely, effectively, upon an Opinion of Counsel as to legal matters and an
Officers’ Certificate as to factual matters if such signer reasonably and in
good faith believes in the accuracy of the document relied upon.


13.05       Statements Required in Certificate or
Opinion.


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


(i)         a statement that the person making such
certificate or opinion has read such covenant or condition;


(ii)        a brief statement as to the nature and
scope of the examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;


(iii)       a statement that, in the opinion of such
person, he or she has made such examination or investigation as is necessary to
enable him or her to express an informed opinion as to whether or not such
covenant or condition has been complied with; and


(iv)       a statement as to whether or not, in the
opinion of such person, such condition or covenant has been complied with.


13.06       Rules by Trustee and Agents.


The
Trustee may make reasonable rules for action by or at a meeting of Securityholders.  The Registrar, Paying Agent or Conversion
Agent may make reasonable rules and set reasonable requirements for their
respective functions.


13.07       Legal Holidays.


A
“Legal
Holiday” is a Saturday, a Sunday or a day on which banking
institutions are not required to be open in the City of New York, in the State
of New York or in the city in which the Trustee administers its corporate trust
business.  If a payment date is a Legal
Holiday at a place of payment, payment may be made at that place on the next
succeeding day that is not a Legal Holiday, and no interest shall accrue on
that payment for the intervening period.


A
“Business
Day” is a day other than a Legal Holiday.


13.08       Duplicate 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. 
Delivery of an executed 


 


-65-

















counterpart by facsimile shall be effective as delivery of a manually
executed counterpart thereof.


13.09       Governing Law.


The
laws of the State of New York, without regard to principles of conflicts of
law, shall govern this Indenture and the Securities.


13.10       No Adverse Interpretation of Other
Agreements.


This
Indenture may not be used to interpret another indenture, loan or debt
agreement of the Company or any of the Subsidiaries.  Any such indenture, loan or debt agreement may not be used to interpret
this Indenture.


13.11       Successors.


All
agreements of the Company in this Indenture and the Securities shall bind their
respective successors.  All agreements
of the Trustee in this Indenture shall bind its successors.


13.12       Separability.


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 and a
Holder shall have no claim therefor against any party hereto.


13.13       Table of Contents, Headings, etc.


The
Table of Contents, Cross-Reference Table and headings of the Articles and Sections
of this Indenture have been inserted for convenience of reference only, are not
to be considered a part hereof and shall in no way modify or restrict any of
the terms or provisions hereof.


 


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IN WITNESS WHEREOF, the parties hereto have
caused this Indenture to be duly executed as of the date first above written.


 


	
   

  	
  PROTEIN
  DESIGN LABS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/  MARK MCDADE

  
	
   

  	
   

  	
  Name:  Mark McDade

  
	
   

  	
   

  	
  Title:  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  J.P.
  MORGAN TRUST COMPANY, NATIONAL ASSOCIATION

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/  MITCH GARDNER

  
	
   

  	
   

  	
  Name:  Mitch Gardner

  
	
   

  	
   

  	
  Title:  Vice President

  
	
   

  	
   

  	
   

  



 


 


 























 


EXHIBIT A


[Face
of Security]


Protein Design Labs, Inc.


Certificate
No. _______


[INSERT
PRIVATE PLACEMENT LEGEND AND GLOBAL SECURITY LEGEND AS REQUIRED]


2.75% Convertible
Subordinated Note due 2023

CUSIP No. ____________


Protein
Design Labs, Inc., a Delaware corporation (herein called the “Company”),
for value received, hereby promises to pay to Cede & Co., or registered
assigns, the principal sum of two hundred and fifty million dollars
($250,000,000) on August 16, 2023 and to pay interest thereon, as provided on
the reverse hereof, until the principal and any unpaid and accrued interest is
paid or duly provided for.  The right to
payment of the principal and all other amounts due with respect hereto is
subordinated to the rights of Senior Indebtedness as set forth in the Indenture
referred to on the reverse side hereof.


Interest
Payment Dates: February 16 and August 16, with the first payment to be made on
February 16, 2004.


Record
Dates: February 1 and August 1.


The
provisions on the back of this certificate are incorporated as if set forth on
the face hereof.


IN WITNESS WHEREOF, PROTEIN
DESIGN LABS, INC. has caused this instrument to be duly signed.


Protein
Design Labs, Inc.


 


By:                                                                                              

Name:

Title:


Dated: ________________


 


 


A-1

















 


TRUSTEE’S
CERTIFICATE OF AUTHENTICATION


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


J.P.
Morgan Trust Company, National Association,  as Trustee


By:                                                                                                               


Authorized
Signatory


Dated: ________________


 


A-2

















 


 


[REVERSE OF SECURITY]


 


PROTEIN DESIGN LABS, INC.


 


2.75% Convertible
Subordinated Note due 2023


1.             Interest.  Protein Design Labs, Inc., a Delaware
corporation (the “Company”), promises to pay interest on the
principal amount of this Security at the rate per annum shown above.  The Company will pay interest semi-annually
on February 16 and August 16 of each year, with the first payment to be made on
February16, 2004.  Interest on the
Securities will accrue on the principal amount from the most recent date to
which interest has been paid or provided for or, if no interest has been paid,
from July 14, 2003.  Interest will be
computed on the basis of a 360-day year of twelve 30-day months.


The Holder of this Security is entitled to the benefits of the Pledge
Agreement, dated July 14, 2003, between the Company and the Trustee,
pursuant to which, among other things, the Company has placed in the Pledge
Account Pledged Financial Assets sufficient to provide for the payment in full
of the first six (6) interest payments on this Security.  The terms capitalized but undefined in this
paragraph have the meanings ascribed to them in the Pledge Agreement.


2.             Maturity.  The Securities will mature on August 16,
2023.


3.             Method of
Payment.  The Company will
pay interest on the Securities (except defaulted interest) to the persons who
are registered Holders of Securities at the close of business on the record
date set forth on the face of this Security next preceding the applicable
interest payment date.  Holders must
surrender Securities to a Paying Agent to collect the principal, Redemption
Price, Option Purchase Price or Repurchase Price of the Securities, plus, if
applicable, accrued and unpaid interest, if any, payable as herein provided
upon Redemption, Repurchase at Holder’s Option or Repurchase Upon Repurchase
Event, as the case may be.  The Company
will pay all amounts due with respect to the Securities in money of the United
States that at the time of payment is legal tender for payment of public and private
debts.  If this Security is in global
form, the Company will pay interest on the Securities by wire transfer of
immediately available funds to the account specified by the Holder.  With respect to securities held other than
in global form, the Company will make payments by wire transfer of immediately
available funds to the account specified by the Holders thereof or, if no such
account is specified with respect to a Holder, by mailing a check to the
Holder’s registered address.


4.             Paying
Agent, Registrar, Conversion Agent. 
Initially, J.P. Morgan Trust Company, National Association (the “Trustee”),
will act as Paying Agent, Registrar and Conversion Agent.  The Company may change any Paying Agent,
Registrar or Conversion Agent without notice.


5.             Indenture.  The Company issued the Securities under an
Indenture, dated as of July 14, 2003 (the “Indenture”), between the Company and the
Trustee.  The terms of the Securities
include those stated in the Indenture and those made part of the Indenture by
reference 


A-3

















to
the Trust Indenture Act of 1939 (15 U.S. Code §§ 77aaa-77bbbb) (the “Act”)
as in effect on the date of the Indenture. 
The Securities are subject to all such terms, and Securityholders are
referred to the Indenture and the Act for a statement of such terms.  Except for Permitted Payments, the
Securities are general unsecured subordinated obligations of the Company
limited to $250,000,000 aggregate principal amount ($300,000,000 if the Initial
Purchasers have elected to exercise the Option to purchase the $50,000,000 of
Additional Securities), except as otherwise provided in the Indenture (except
for Securities issued in substitution for destroyed, mutilated, lost or stolen
Securities).  Terms used herein which
are defined in the Indenture have the meanings assigned to them in the
Indenture.


6.             Optional
Redemption.  The Securities
will be redeemable prior to maturity at the option of the Company, in whole or
in part, at any time on or after August 16, 2008 (the date of such time, the “Redemption
Date”), at a redemption price equal to one hundred percent (100%) of
the principal amount of the Securities to be redeemed, plus any accrued and
unpaid interest to, but excluding, the Redemption Date; provided that if such
Redemption Date is also an interest payment date, such accrued and unpaid
interest will be payable in the ordinary course to the Holder of record on the
relevant record date.


7.             Notice of
Redemption.  Notice of redemption
will be mailed at least thirty (30) days but not more than sixty (60) days
before the Redemption Date to each Holder of Securities to be redeemed at its
registered address.  Securities in
denominations larger than $1,000 principal amount may be redeemed in part but
only in integral multiples of $1,000 principal amount.  On and after the Redemption Date, interest
will cease to accrue on Securities or portions of them called for redemption
(except to the extent the Company defaults in the payment of the Redemption
Price or accrued and unpaid interest, if any, to, but excluding, the Redemption
Date).


8.             Purchase by
the Company at the Option of the Holder.  Subject to the terms and conditions of the Indenture, the Company
shall become obligated to purchase, at the option of the Holder, the Securities
held by such Holder on August 16, 2010, August 16, 2013 and August 16, 2018
(each, an “Option Purchase Date”) at an Option Purchase Price of one
hundred percent (100%) of the Principal Amount at Maturity of Securities to be
purchased, plus accrued and unpaid interest, if any, to, but excluding,
applicable Option Purchase Date, upon delivery of a Purchase Notice containing
the information set forth in the Indenture, at any time from the opening of
business on the date that is twenty (20) Business Days prior to applicable
Option Purchase Date until the close of business on the Business Day
immediately preceding the applicable Option Purchase Date and upon delivery of
the Securities to the Paying Agent by the Holder as set forth in the
Indenture.  The Option Purchase Price,
plus accrued and unpaid interest, if any, payable, as provided in the
Indenture, in respect of Securities upon a Repurchase at Holder’s Option, shall
be paid in cash if the applicable Option Purchase Date is August 16, 2010.  Subject to certain conditions and exceptions
set forth in the Indenture, upon a Repurchase at Holder’s Option where the
applicable Option Purchase Date is August 16, 2013 or August 16, 2018, the
Option Purchase Price may be paid for, in whole or in part, at the election of
the Company, in cash or shares of Common Stock or in any combination of cash
and shares of Common Stock.


 


A-4

















 Holders have the right to
withdraw any Purchase Notice by delivering to the Paying Agent a written notice
of withdrawal in accordance with the provisions of the Indenture.


If the Paying Agent (other than the Company) holds on the applicable
Option Purchase Date money and/or Common stock, if applicable and as provided
in the Indenture, sufficient to pay the aggregate Option Purchase Price, and
accrued and unpaid interest, if any, to, but excluding, the applicable Option
Purchase Date, payable in respect of Securities on the applicable Option Purchase
Date, then immediately after the applicable Option Purchase Date such Securities
shall be deemed to be no longer outstanding and interest on them shall cease to
accrue, and such Securities shall be deemed paid whether or not such Securities
are delivered to the Paying Agent. 
Thereafter, all other rights of the Holders of such Securities shall
terminate with respect to such Securities, other than the right to receive the
Option Purchase Price plus such accrued and unpaid interest.


9.             Repurchase
at Option of Holder Upon a Repurchase Event.  In the event of a Repurchase Event, then
each Holder of the Securities shall have the right, at the Holder’s option,
subject to the rights of the holders of Senior Indebtedness under Article XI
of the Indenture, to require the Company to repurchase such Holder’s
Securities including any portion thereof which is $1,000 in principal amount or
any integral multiple thereof on a date (the “Repurchase Date”) no later
than thirty (30) days after the date on which notice of such Repurchase Event
is mailed in accordance with the immediately succeeding paragraph, at a price
equal to one hundred percent (100%) of the outstanding principal amount of such
Security, plus accrued and unpaid interest to, but excluding, the Repurchase
Date.


Within
fifteen (15) days after the occurrence of the Repurchase Event, the Company is
obligated to give notice of the occurrence of such Repurchase Event to each
Holder.  Such notice shall include,
among other things, the date by which Holder must notify the Company of such
Holder’s intention to exercise the Repurchase Right and of the procedure which
such Holder must follow to exercise such right.  To exercise the Repurchase Right, a Holder of Securities must, in
accordance with the provisions of the Indenture, (i) deliver, no later than the
close of business on the Business Day immediately preceding the Repurchase
Date, written notice to the Paying Agent of the Holder’s exercise of such
right; and (ii) deliver, at any time after the delivery of such written notice,
the Securities with respect to which the Holder is exercising its Repurchase
Right, duly endorsed for transfer to the Company.


A
“Repurchase
Event” of the Company shall be deemed to have occurred upon the
occurrence of either a “Change in Control” or a “Termination of Trading.”


A
“Change
in Control” of the Company shall be deemed to have occurred at such
time as:


(i) any “person” or “group” (as
such terms are used for purposes of Sections 13(d) and 14(d) of the Exchange
Act) is or becomes the “beneficial owner” (as such term is used in Rule 13d-3
under the Exchange Act), directly or indirectly, of 50% or more of the total
voting power of all classes of the Company’s Capital Stock entitled to vote
generally in the election of directors; or


 


A-5

















 


(ii) at any time the following
persons cease for any reason to constitute a majority of the Company’s Board of
Directors:


(1) individuals who on the Issue Date constituted
the Company’s Board of Directors; and


(2) any new directors whose election by the
Company’s Board of Directors or whose nomination for election by the Company’s
stockholders was approved by at least a majority of the directors then still in
office who were either directors on the Issue Date or whose election or
nomination for election was previously so approved; or


(iii) The Company consolidates
with, or merges with or into, another person or any person consolidates with,
or merges with or into, the Company, in any such event other than pursuant to a
transaction in which the persons that “beneficially owned,” directly or
indirectly, the shares of the Company’s Voting Stock immediately prior to such
transaction, “beneficially own,” directly or indirectly, immediately after such
transaction, shares of the Company’s Voting Stock representing at least a
majority of the total voting power of all outstanding classes of Voting Stock
of the continuing or surviving corporation in substantially the same proportion
as such ownership prior to the transaction; or


(iv) the sale, lease, transfer or
other conveyance or disposition of all or substantially all of the assets or
property of the Company to any “person” or “group” (as such terms are used in
Sections 13(d) and 14(d) of the Exchange Act), including any group acting for
the purpose of acquiring, holding, or disposing of securities within the
meaning of Rule 13d-5(b)(1) under the Exchange Act; or


(v) the Company is liquidated or
dissolved or the holders of the Company’s Capital Stock approve any plan or proposal
for the liquidation or dissolution of the Company;


provided, however,
that a Change in Control shall not be deemed to occur if either:


 


(A) the Closing Sale Price for each of any five (5)
Trading Days during the ten (10) Trading Days immediately preceding the Change
in Control is equal to at least one hundred and five percent (105%) of the
Conversion Price in effect on such Trading Day;


 


(B) in the case of a merger or consolidation, all
of the consideration (excluding cash payments for fractional shares and cash
payments pursuant to dissenters’ appraisal rights) in the merger or
consolidation constituting the Change in Control consists of common stock
traded on a U.S. national securities exchange or quoted on The Nasdaq National
Market (or which will be so traded or quoted when issued or exchanged in
connection with such Change in Control) and as a result of such transaction or
transactions the Securities become convertible solely into such common stock;
or


 


 


A-6

















 


(C) in the case of a Qualifying Foreign Merger, all
of the consideration (excluding cash payments for fractional shares and cash
payments pursuant to dissenters’ or appraisal rights) in the Qualifying Foreign
Merger constituting the Change in Control consists of common stock or American
Depositary Shares representing such common stock traded on a U.S. national
securities exchange or quoted on The Nasdaq National Market (or which will be
so traded or quoted when issued or exchanged in connection with such Change in
Control) and as a result of such transaction or transactions the Securities
become convertible solely into such common stock or American Depositary Shares.


 


A
“Termination
of Trading” shall occur if the Common Stock of the Company (or other
common stock into which the Securities are then convertible) is neither listed
for trading on a U.S. national securities exchange nor approved for trading on
an established automated over-the-counter trading market in the United States; provided,
however,
that a Termination of Trading shall not be deemed to have occurred solely by
reason of the Company having engaged in a Qualifying Foreign Merger, so long
as, immediately after such Qualifying Foreign Merger, the Holders shall have
the right to convert their Securities solely into common stock or American
Depositary Shares representing such common stock traded on a U.S. national
securities exchange or quoted on The Nasdaq National Market, until such time as
the common stock or American Depositary Shares on such common stock into which
the Securities are solely convertible are no longer so traded or quoted.


10.           Conversion.


A Holder may convert his or her Security into Common Stock of the
Company at any time prior to the close of business on the earlier of (i) August
16, 2023, (ii) if the Security is called for Redemption by the Company, the
Business Day immediately preceding the Redemption Date, (iii) if the Security
is to be repurchased by the Company pursuant to a Repurchase Event, the
Repurchase Date (provided that the holder has timely withdrawn, in accordance
with the indenture, any Purchase Notice delivered with respect to the Security)
or (iv) if the Security is to be purchased by the Company pursuant to a
Repurchase at Holder’s Option, the applicable Option Purchase Date (provided
that the holder has timely withdrawn, in accordance with the indenture, any
Purchase Notice delivered with respect to the Security).  The initial Conversion Rate is 49.6618
shares of Common Stock per $1,000 principal amount of Securities, or an
effective initial Conversion Price of approximately $20.14 per share, subject
to adjustment in the event of certain circumstances as specified in the
Indenture.  The Company will deliver a
check in lieu of any fractional share. 
On conversion no payment or adjustment for any unpaid and accrued
interest, or liquidated damages with respect to, the Securities will be
made.  If a Holder surrenders a Security
for conversion between the record date for the payment of interest and prior to
the next interest payment date, such Security, when surrendered for conversion,
must be accompanied by payment of an amount equal to the interest thereon which
the registered Holder on such record date is to receive, unless the Securities
have been called for redemption as described in the Indenture.


To
convert a Security, a Holder must (1) complete and sign the Conversion Notice,
with appropriate signature guarantee, on the back of the Security, (2)
surrender the Security to a Conversion Agent, (3) furnish appropriate
endorsements and transfer documents if required by 


 


A-7

















 


the Registrar or Conversion Agent, (4) pay the amount of interest, if
any, the Holder may be paid as provided in the last sentence of the above
paragraph and (5) pay any transfer or similar tax if required.  A Holder may convert a portion of a Security
if the portion is $1,000 principal amount or an integral multiple of $1,000
principal amount.


Any
shares issued upon conversion of a Security shall bear the Private Placement Legend
until after the second anniversary of the later of the Issue Date and the last
date on which the Company or any Affiliate was the owner of such shares or the
Security (or any predecessor security) from which such shares were converted
(or such shorter period of time as permitted by Rule 144(k) under the
Securities Act or any successor provision thereunder) (or such longer period of
time as may be required under the Securities Act or applicable state securities
laws, as set forth in an the Opinion of Counsel, unless otherwise agreed by the
Company and the Holder thereof).


11.           Subordination.  The Securities are subordinated in right of
payment, in the manner and to the extent set forth in the Indenture, to the
prior payment in full of all Senior Indebtedness.  Each Holder by accepting a Security agrees to such subordination
and authorizes the Trustee to give it effect.


12.           Denominations,
Transfer, Exchange.  The
Securities are in registered form without coupons in denominations of $1,000
principal amount and integral multiples of $1,000 principal amount.  The transfer of Securities may be registered
and Securities may be exchanged as provided in the Indenture.  The Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents.  No service charge shall be made for any such
registration of transfer or exchange, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge payable in connection
therewith.  The Registrar need not
exchange or register the transfer of any Security selected for redemption in
whole or in part, except the unredeemed portion of Securities to be redeemed in
part.  Also, it need not exchange or
register the transfer of any Securities for a period of fifteen (15) days
before the mailing of a notice of redemption of the Securities selected to be
redeemed and in certain other circumstances provided in the Indenture.


13.           Persons
Deemed Owners.  The
registered Holder of a Security may be treated as the owner of such Security
for all purposes.


14.           Merger or
Consolidation.  The Company
shall not consolidate with, or merge with or into, or sell, convey, transfer,
lease or otherwise dispose of all or substantially all of its properties and
assets to, another person (whether in a single or series of related
transactions) unless (i) the resulting, surviving or transferee person is
either (A) a corporation, limited liability company, partnership or trust
organized and existing under the laws of the United States, any State thereof
or the District of Columbia or (B) a corporation, limited liability company,
partnership or trust organized and existing under the laws of a jurisdiction
outside the United States, where the transaction is a Qualifying Foreign
Merger, as described in, and subject to the provisions of, the Indenture; (ii)
the resulting, surviving or transferee person assumes by supplemental indenture
all the obligations of the Company under the Securities and the Indenture; and
(iii) immediately after giving effect to such transaction, no Default or Event
of Default shall exist.


 


A-8

















 


15.           Amendments,
Supplements and Waivers. 
Subject to certain exceptions, the Indenture or the Securities may be
amended or supplemented with the consent of the Holders of at least a majority
in aggregate principal amount of the Securities then outstanding, and any existing
Default or Event of Default may be waived with the consent of the Holders of a
majority in aggregate principal amount of the Securities then outstanding.  Subject to certain exceptions, without
notice to or the consent of any Securityholder, the Indenture or the Securities
may be amended or supplemented, among other things, to cure any ambiguity,
defect or inconsistency, to comply with Sections 5.01 and 10.12 of the Indenture, to
make any changes or modifications to the Indenture necessary in connection with
the registration of the Securities under the Securities Act pursuant to the
Registration Rights Agreement and the qualification of the Indenture under the
TIA, to secure the obligations of the Company in respect of the Securities, or
to add to covenants of the Company described in the Indenture for the benefit
of Securityholders, to surrender any right or power conferred upon the Company
or to make provisions with respect to adjustments to the Conversion Rate as
required by the Indenture or to increase the Conversion Rate in accordance with
the Indenture or to add or modify any other provisions of the Indenture which
the Company and the Trustee jointly deem necessary or desirable and which do
not adversely affect any Holder’s rights.


16.           Defaults and
Remedies.  Subject to the
provisions of the Indenture, an Event of Default includes the occurrence of any
of the following: (i) default in payment of principal or premium, whether at
maturity, upon Redemption, on an Option Purchase Date with respect to a
Repurchase at Holder’s Option, on a Repurchase Date with respect to a Repurchase
Upon Repurchase Event or otherwise; (ii) default for thirty (30) days in
payment of interest or liquidated damages (provided, that a failure to make any of
the first six (6) scheduled interest payments on any Security within three (3)
Business Days after the applicable interest payment dates will constitute an
Event of Default with no additional grace or cure period); (iii) failure to
timely provide, as required, an Option Purchase Notice or a Repurchase Event
Notice; (iv) failure by the Company for sixty (60) days after notice is given,
as specified in the Indenture, to it to comply with any of the Company’s other
agreements in the Indenture or the Securities; (v) the Company’s failure to
perform or observe any of its obligations under the Pledge Agreement (including
any supplement thereto) or the Control Agreement or the failure of the
Company’s representations and warranties set forth in such agreements to be
true and correct, in all material respects, when deemed made; (vi) the Pledge
Agreement ceasing to be in full force and effect or enforceable in accordance
with its terms; (vii) certain payment defaults or the acceleration of other
Indebtedness of the Company and the Subsidiaries or certain payment defaults on
final judgments; and (viii) certain events of bankruptcy or insolvency
involving Company or any of its Significant Subsidiaries or any group of
Subsidiaries that in the aggregate would constitute a Significant Subsidiary of
the Company.  If any Event of Default
occurs and is continuing, the Trustee or the Holders of at least 25% in
aggregate principal amount of the Securities then outstanding may declare all
the Securities to be due and payable immediately, except as provided in the
Indenture.  If an Event of Default
specified in Section 6.01(ix) or (x) of the Indenture with respect to the
Company occurs, the principal of and accrued interest on all the Securities
shall ipso
facto become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any Securityholder.  Securityholders may not enforce the
Indenture or the Securities except as provided in the Indenture.  The Trustee may require indemnity reasonably
satisfactory to it before it enforces the Indenture or the Securities.  Subject to certain limitations, Holders of a
majority in principal amount of the Securities then outstanding may 


 


A-9

















 


direct the Trustee in its exercise of any trust or power.  The Trustee may withhold from
Securityholders notice of any continuing Default or Event of Default (except a
Default or Event of Default in payment) if it determines that withholding
notice is in the interests of the Securityholders.  The Company must furnish an annual compliance certificate to the
Trustee.


17.           Registration
Rights.  The Holders are
entitled to registration rights as set forth in the Registration Rights
Agreement.  The Holders shall be entitled
to receive liquidated damages in certain circumstances, all as set forth in the
Registration Rights Agreement.


18.           Trustee
Dealings with the Company. 
The Trustee under the Indenture, or any banking institution serving as
successor Trustee thereunder, in its individual or any other capacity, may make
loans to, accept deposits from, and perform services for the Company or its
Affiliates, and may otherwise deal with the Company or its Affiliates, as if it
were not Trustee.


19.           No Recourse
Against Others.  No past,
present or future director, officer, employee or stockholder, as such, of the
Company shall 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. 
Each Securityholder by accepting a Security waives and releases all such
liability.  The waiver and release are
part of the consideration for the issue of the Securities.


20.           Authentication.  This Security shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.


21.           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 entirety), JT TEN (= joint tenants with
right of survivorship and not as tenants in common), CUST (= Custodian), and
U/G/M/A (Uniform Gifts to Minors Act).


THE
COMPANY WILL FURNISH TO ANY SECURITYHOLDER UPON WRITTEN REQUEST AND WITHOUT
CHARGE A COPY OF THE INDENTURE. 
REQUESTS MAY BE MADE TO:


Protein Design Labs, Inc.


34801 Campus Drive


Fremont, California 94555


 


A-10

















 


	
  [FORM
  OF ASSIGNMENT]

  
	
  I
  or we assign to

  	
   

  
	
  PLEASE INSERT SOCIAL
  SECURITY OR OTHER IDENTIFYING NUMBER

  	
   

  
	
   

  	
   

  
	
  (please print or type name and address)

  
	
   

  
	
  the within Security and all rights thereunder, and hereby irrevocably
  constitutes and appoints

  



Attorney to transfer the Security on the books of the Company with full
power of substitution in the premises. 


 


 


	
  Dated:

  	
   

  	
   

  



 


	
   

  	
  NOTICE:  The signature on this assignment must
  correspond with the name as it appears upon the face of the within Security
  in every particular without alteration or enlargement or any change
  whatsoever and be guaranteed by a guarantor institution participating in the
  Securities Transfer Agents Medallion Program or in such other guarantee
  program acceptable to the Trustee.

  



 


	
    Signature Guarantee:

  	
   

  



 


	
  In
  connection with any transfer of this Security occurring prior to the date
  which is the earlier of (i) the date of the declaration by the Commission of
  the effectiveness of a registration statement under the Securities Act of
  1933, as amended (the “Securities Act”) covering resales of this
  Security (which effectiveness shall not have been suspended or terminated at
  the date of the transfer) and (ii) the Resale Restriction Termination Date,
  the undersigned confirms that it has not utilized any general solicitation or
  general advertising in connection with transfer:

  



 


A-11

















[Check One]


 


	
  (1)

  	
   

  	
   

  	
  to the Company or any Subsidiary thereof; or

  
	
   

  	
   

  	
   

  	
   

  
	
  (2)

  	
   

  	
   

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

  
	
   

  	
   

  	
   

  	
   

  
	
  (3)

  	
   

  	
   

  	
  pursuant
  to the exemption from registration provided by Rule  144 under the Securities
  Act of 1933, as amended; or

  
	
   

  	
   

  	
   

  	
   

  
	
  (4)

  	
   

  	
   

  	
  pursuant
  to the exemption from registration under the Securities Act of 1933, as
  amended, other than under Rule 144A or Rule 144;

  
	
   

  	
   

  	
   

  	
   

  
	
  (5)

  	
   

  	
   

  	
  pursuant
  to an effective registration statement under the Securities Act of 1933, as
  amended.

  



 


and unless the box below is checked, the undersigned confirms that such
Security is not being transferred to an “affiliate” of the Company as defined
in Rule 144 under the Securities Act of 1933, as amended (an “Affiliate”):


o The transferee is an Affiliate of the
Company.  (If the Security is
transferred to an Affiliate, the restrictive legend must remain on the Security
for two (2) years following the date of the transfer).


Unless
one of the items is checked, the Trustee will refuse to register any of the Securities
evidenced by this certificate in the name of any person other than the
registered Holder thereof; provided, however, that if item (3)
or (4) is checked, the Company or the Trustee may require, prior to registering
any such transfer of the Securities, in their sole discretion, such written
legal opinions, certifications and other information as the Trustee or the
Company have reasonably requested to confirm that such transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act of 1933, as amended.


 


If
none of the foregoing items are checked, the Trustee or Registrar shall not be
obligated to register this Security in the name of any person other than the
Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in the Indenture shall have been satisfied.


 


	
  Dated:

  	
   

  	
   

  	
  Signed

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (Sign
  exactly as name appears on the other side of this Security)

  



 


	
   Signature Guarantee:

  	
   

  



 


 


A-12

















 


TO BE COMPLETED BY PURCHASER
IF (2) ABOVE IS CHECKED


 


The undersigned represents
and warrants that it is purchasing this Security for its own account or an
account with respect to which it exercises sole investment discretion and that
it and any such account is a “qualified institutional buyer” within the meaning
of Rule 144A under the Securities Act of 1933, as amended, and is aware that
the sale to it is being made in reliance on Rule 144A and acknowledges that it
has received such information regarding the Company as the undersigned has
requested pursuant to Rule 144A and acknowledges that the transferor is relying
upon the undersigned’s foregoing representations in order to claim the
exemption from registration provided by Rule 144A.


 


	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  NOTICE:  To
  be executed by an executive officer

  
					



 


 


A-13

















CONVERSION NOTICE


 


To
convert this Security into Common Stock of the, check the box: o


 


To convert only part of this Security, state the principal amount to be
converted (must be in multiples of $1,000):


 


	
  $

  	
   

  	
   

  



 


If
you want the stock certificate made out in another person’s name, fill in the
form below:


 


	
   

  
	
  (Insert
  other person’s soc. sec. or tax I.D. no.)

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
  (Print or type other person’s name, address and zip code)

  
	
   

  



 


	
  Date:

  	
   

  	
   

  	
   Signature(s):

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (Sign
  exactly as your name(s) appear(s) on the other side of this Security)

  



 


	
  Signature(s)
  guaranteed by:

  	
   

  	
   

  
	
   

  	
   

  	
  (All
  signatures must be guaranteed by a guarantor institution participating in the
  Securities Transfer Agents Medallion Program or in such other guarantee
  program acceptable to the Trustee.)

  
	
   

  	
   

  
	
   

  	
   

  



 


 


A-14

















PURCHASE NOTICE


 


	
   

  	
  Certificate
  No. of Security:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  



Check
the appropriate box:


o                                     I elect to have
the following principal amount of this Security purchased by the Company
pursuant to Section 3.08 of the Indenture:


	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (in an integral multiple of $1,000)

  	
   

  



 


If
you checked the above box, then check the box below corresponding to the date
on which you elect to have all or part of this Security purchased by the
Company:


August 16, 2010:  o


 


August 16, 2013:  o


 


August
16, 2018:  o


If
you checked the box next to August 16, 2013 or August 16, 2018, then check the
appropriate box:


In
the event the Company elects to pay the Option Purchase Price, in whole or in
part, in shares of Common Stock, but the Option Purchase Price is ultimately to
be paid entirely in cash because any of the conditions to payment of the Option
Purchase Price in shares of Common Stock is not satisfied before the close of
business on the Business Day immediately preceding the Option Purchase Date,
you elect:


o                                   to withdraw
this Purchase Notice as to the following principal amount of this Security:


	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (in an integral multiple of $1,000)

  	
   

  



 


or


o                                   to receive cash
in respect of the Option Purchase Price for that portion of the principal
amount of this Security which I have elected above to be purchased by the
Company pursuant to Section 3.08 of the Indenture


o                                     I elect to have
the following principal amount of this Security purchased by the Company
pursuant to Section 3.09 of the Indenture:


	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (in an integral multiple of $1,000)

  	
   

  



 


 


A-15

















 


	
  Date:

  	
   

  	
   

  	
   Signature(s):

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (Sign
  exactly as your name(s) appear(s) on the other side of this Security)

  



 


	
  Signature(s)
  guaranteed by:

  	
   

  	
   

  
	
   

  	
   

  	
  (All
  signatures must be guaranteed by a guarantor institution participating in the
  Securities Transfer Agents Medallion Program or in such other guarantee
  program acceptable to the Trustee.)

  
	
   

  	
   

  
	
   

  	
   

  



 


 


A-16

















 


SCHEDULE A


 


SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL SECURITYa.


 


 The following exchanges of a part of this
Global Security for an interest in another Global Security or for Securities in
certificated form, have been made:


 


	
   

   

   

   

  Date of Exchange

  	
   

   

  Amount of decrease in

  Principal amount of

  this Global Security

  	
   

   

  Amount of increase in

  Principal amount of 

  this Global Security

  	
  Principal amount of 

  this Global

  Security following

  such decrease

   (or increase)

  	
   

  Signature or authorized signatory of Trustee or Note Custodian

  



 


 












a   This is included in Global Securities only.


 


 


 

















EXHIBIT
B-1


FORM OF PRIVATE PLACEMENT LEGEND


THIS SECURITY AND THE COMMON STOCK ISSUABLE UPON
CONVERSION OF THIS SECURITY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH THE FOLLOWING
SENTENCE.  BY ITS ACQUISITION HEREOF OR
OF A BENEFICIAL INTEREST HEREIN, THE ACQUIRER


(1)  REPRESENTS
THAT IT AND ANY ACCOUNT FOR WHICH IT IS ACTING IS A “QUALIFIED INSTITUTIONAL
BUYER” (WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT) AND THAT IT
EXERCISES SOLE INVESTMENT DISCRETION WITH RESPECT TO EACH SUCH ACCOUNT, AND


(2) AGREES THAT
IT WILL NOT DIRECTLY OR INDIRECTLY ENGAGE IN ANY HEDGING TRANSACTIONS INVOLVING
THIS SECURITY OR THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY
UNLESS IN COMPLIANCE WITH THE SECURITIES ACT, AND


(3)  AGREES FOR
THE BENEFIT OF THE COMPANY THAT IT WILL NOT OFFER, SELL, PLEDGE OR OTHERWISE
TRANSFER THIS SECURITY OR ANY BENEFICIAL INTEREST HEREIN, PRIOR TO THE DATE
THAT IS THE LATER OF (X) TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE
HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY
WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF THIS SECURITY) OR SUCH
SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(K) UNDER THE SECURITIES ACT OR
ANY SUCCESSOR PROVISION THEREUNDER, AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE
REQUIRED BY APPLICABLE LAW, EXCEPT ONLY


(A)  TO THE
COMPANY OR ANY SUBSIDIARY THEREOF,


(B)  PURSUANT TO
A REGISTRATION STATEMENT WHICH HAS BECOME EFFECTIVE UNDER THE SECURITIES ACT,


(C)  TO A
QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES
ACT, OR


(D)  PURSUANT TO
AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT OR
ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT.


PRIOR TO THE REGISTRATION OF ANY TRANSFER IN
ACCORDANCE WITH (3)(C) ABOVE, A DULY COMPLETED AND SIGNED CERTIFICATE (THE FORM
OF WHICH MAY BE OBTAINED FROM THE TRUSTEE) MUST BE DELIVERED TO THE
TRUSTEE.  PRIOR TO THE REGISTRATION OF
ANY TRANSFER IN ACCORDANCE WITH (3)(D) ABOVE, THE COMPANY AND THE TRUSTEE
RESERVE THE RIGHT TO REQUIRE THE DELIVERY OF SUCH LEGAL OPINIONS,
CERTIFICATIONS OR OTHER EVIDENCE AS MAY REASONABLY BE REQUIRED IN ORDER TO
DETERMINE THAT THE PROPOSED TRANSFER IS BEING MADE IN COMPLIANCE WITH THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS.  NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF ANY EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.


 


B-1-1

















 


EXHIBIT B-2


FORM OF LEGEND FOR GLOBAL SECURITY


Any
Global Security authenticated and delivered hereunder shall bear a legend
(which would be in addition to any other legends required in the case of a
Restricted Security) in substantially the following form:


THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING
OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A
DEPOSITARY OR A NOMINEE OF A DEPOSITARY OR A SUCCESSOR DEPOSITARY.  THIS SECURITY IS NOT EXCHANGEABLE FOR
SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS
NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO
TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY
THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY
TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.


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.


TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS
SET FORTH IN SECTION 2.16 OF THE INDENTURE.


 


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EXHIBIT C


Form of Notice of Transfer
Pursuant to Registration Statement


Protein Design Labs, Inc.


34801 Campus Drive


Fremont, California 94555


Attention:
General Counsel


 


J.P. Morgan Trust Company, National
Association


560 Mission Street, 13th Floor


San Francisco, CA 94105


Attention:
Corporate Trust Administration


 


Re:                               Protein Design
Labs, Inc. (the “Company”) 2.75% Convertible Subordinated Notes due 2023 (the “Securities”)


Ladies
and Gentlemen:


Please
be advised that _____________ has transferred $___________ aggregate principal
amount of the Securities or ________ shares of the Common Stock, $.01 par value
per share, of the Company issuable on conversion of the Securities (“Stock”)
pursuant to an effective Shelf Registration Statement on Form S-3 (File No.
333-________).


We
hereby certify that the prospectus delivery requirements, if any, of the
Securities Act of 1933 as amended, have been satisfied with respect to the
transfer described above and that the above-named beneficial owner of the Securities
or Stock is named as a “Selling Security Holder” in the Prospectus
dated _________, or in amendments or supplements thereto, and that the
aggregate principal amount of the Securities, or number of shares of Stock
transferred are [a portion of] the Securities or Stock listed in such
Prospectus, as amended or supplemented, opposite such owner’s name.


	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  (Name)

  



 


 


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EXHIBIT
D


Form of Opinion of Counsel
in Connection with Registration of Securities


J.P. Morgan Trust Company, National
Association


560 Mission Street, 13th Floor


San Francisco, CA 94105


Attention:
Corporate Trust Administration


 


Re:                               Protein Design
Labs, Inc. (the “Company”) 2.75% Convertible Subordinated Notes due 2023 (the “Securities”)


Ladies and Gentlemen:


Reference
is made to the Securities issued pursuant to the Indenture dated as of July 14,
2003 by and between the Company and J.P. Morgan Trust Company, National
Association, as trustee (the “Trustee”). 
The Company issued $250,000,000 principal amount of Securities on July
14, 2003 [and an additional $__________________ on ______________, 2003 [IF THE
INITIAL PURCHASERS’ OPTION IS EXERCISED]] in transactions exempt from
registration under the Securities Act of 1933, as amended (the “Securities
Act”).  The Company has filed
with the Securities and Exchange Commission (the “SEC”) a registration
statement on Form S-3 (File No. 333-______) (the “Registration Statement”)
relating to the registration under the Securities Act of $______________
principal amount of the Securities and the shares of Common Stock of the
Company (the “Shares”) issuable upon conversion of the Securities being
registered.  The Registration Statement
was declared effective by order of the SEC dated _____________.


We
have acted as counsel for the Company in connection with the issuance of the
Securities and the preparation and filing of the Registration Statement and are
familiar with the Securities, the Indenture, the Registration Statement, the
above-mentioned SEC order and such other documents as are necessary to render
this opinion.


Based
on the foregoing, it is our opinion that (1) the Registration Statement
has become effective under the Securities Act and, to our knowledge, no stop
order suspending the effectiveness of the Registration Statement has been
issued, (2) assuming that the Securities covered by the Registration
Statement and the Shares issuable upon conversion of such Securities are sold
by a relevant Holder specified in the Registration Statement in a manner
specified in the Registration Statement, such sale of the Securities and Shares
issuable upon conversion of the Securities will have been duly registered under
the Securities Act and (3) the Indenture has been duly qualified
under the Trust Indenture Act of 1939, as amended.


Yours
truly,


 


 


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