Exhibit 4.4


 


THERAVANCE, INC.


 


% CONVERTIBLE SUBORDINATED NOTES DUE 2015


 


INDENTURE


 


DATED AS OF JANUARY    , 2008


 


THE BANK OF NEW YORK TRUST COMPANY, N.A.


 


AS TRUSTEE


 

















 


TABLE OF CONTENTS


 


	
   

  	
  Page

  
	
  Article 1

  	
   

  
	
  DEFINITIONS AND INCORPORATION BY REFERENCE

  	
   

  
	
   

  	
   

  
	
  Section 1.01.  Definitions

  	
  1

  
	
  Section 1.02.  Other Definitions

  	
  9

  
	
  Section 1.03.  Trust Indenture Act Provisions

  	
  11

  
	
  Section 1.04.  Rules of Construction

  	
  11

  
	
   

  	
   

  
	
  Article 2

  	
   

  
	
  THE SECURITIES

  	
   

  
	
   

  	
   

  
	
  Section 2.01.  Form and Dating

  	
  12

  
	
  Section 2.02.  Execution and Authentication

  	
  13

  
	
  Section 2.03.  Registrar, Paying Agent and Conversion Agent

  	
  14

  
	
  Section 2.04.  Paying Agent to Hold Money in Trust

  	
  15

  
	
  Section 2.05.  Lists of Holders of Securities

  	
  15

  
	
  Section 2.06.  Transfer and Exchange

  	
  15

  
	
  Section 2.07.  Replacement Securities

  	
  16

  
	
  Section 2.08.  Outstanding Securities

  	
  17

  
	
  Section 2.09.  Treasury Securities

  	
  17

  
	
  Section 2.10.  Temporary Securities

  	
  18

  
	
  Section 2.11.  Cancellation

  	
  18

  
	
  Section 2.12.  Additional Transfer and Exchange Requirements

  	
  18

  
	
  Section 2.13.  CUSIP Numbers

  	
  20

  
	
   

  	
   

  
	
  Article 3

  	
   

  
	
  REDEMPTION

  	
   

  
	
   

  	
   

  
	
  Section 3.01.  Right to Redeem; Notices to Trustee

  	
  21

  
	
  Section 3.02.  Selection of Securities to be Redeemed

  	
  21

  
	
  Section 3.03.  Notice of Redemption

  	
  22

  
	
  Section 3.04.  Effect of Notice of Redemption

  	
  23

  
	
  Section 3.05.  Deposit of Redemption Price

  	
  23

  
	
  Section 3.06.  Securities Redeemed in Part

  	
  23

  
	
  Section 3.07.  No Requirement to Register

  	
  23

  
	
   

  	
   

  
	
  Article 4

  	
   

  
	
  PURCHASE

  	
   

  
	
   

  	
   

  
	
  Section 4.01.  Repurchase of Securities at Option of the Holder upon a Fundamental
  Change

  	
  23

  



 


i

















 


	
  Section 4.02.  Effect of Fundamental Change Repurchase Notice

  	
  26

  
	
  Section 4.03.  Deposit of Fundamental Change Repurchase Price

  	
  27

  
	
  Section 4.04.  Repayment to the Company

  	
  27

  
	
  Section 4.05.  Securities Purchased in Part

  	
  27

  
	
  Section 4.06.  Compliance with Securities Laws upon Purchase of Securities

  	
  28

  
	
  Section 4.07.  Purchase of Securities in Open Market

  	
  28

  
	
   

  	
   

  
	
  Article 5

  	
   

  
	
  CONVERSION

  	
   

  
	
   

  	
   

  
	
  Section 5.01.  Conversion Privilege and Conversion Rate

  	
  28

  
	
  Section 5.02.  Conversion Procedure

  	
  30

  
	
  Section 5.03.  Fractional Shares

  	
  31

  
	
  Section 5.04.  Taxes on Conversion

  	
  32

  
	
  Section 5.05.  Company to Provide Stock

  	
  32

  
	
  Section 5.06.  Adjustment of Conversion Rate

  	
  32

  
	
  Section 5.07.  No Adjustment

  	
  40

  
	
  Section 5.08.  Notice of Adjustment

  	
  40

  
	
  Section 5.09.  Notice of Certain Transactions

  	
  40

  
	
  Section 5.10.  Effect of Recapitalization, Reclassification, Consolidation, Merger
  or Sale

  	
  41

  
	
  Section 5.11.  Trustee’s Disclaimer

  	
  42

  
	
  Section 5.12.  Voluntary Increase

  	
  42

  
	
   

  	
   

  
	
  Article 6

  	
   

  
	
  SUBORDINATION

  	
   

  
	
   

  	
   

  
	
  Section 6.01.  Agreement of Subordination

  	
  42

  
	
  Section 6.02.  Payments to Holders

  	
  43

  
	
  Section 6.03.  Subrogation of Securities

  	
  45

  
	
  Section 6.04.  Authorization to Effect Subordination

  	
  46

  
	
  Section 6.05.  Notice to Trustee

  	
  47

  
	
  Section 6.06.  Trustee’s Relation to Senior Indebtedness

  	
  48

  
	
  Section 6.07.  No Impairment of Subordination

  	
  48

  
	
  Section 6.08.  Certain Conversions Deemed Payment

  	
  48

  
	
  Section 6.09.  Article Applicable to Paying Agents

  	
  48

  
	
  Section 6.10.  Senior Indebtedness Entitled to Rely

  	
  49

  
	
  Section 6.11.  Reliance on Judicial Order or Certificate of Liquidating Agent

  	
  49

  
	
  Section 6.12.  Rights of Trustee as Holder of Senior Indebtedness; Preservation of
  Trustee’s Rights

  	
  49

  
	
   

  	
   

  
	
  Article 7

  	
   

  
	
  COVENANTS

  	
   

  
	
   

  	
   

  
	
  Section 7.01.  Payment of Securities

  	
  49

  
	
  Section 7.02.  SEC and Other Reports

  	
  50

  
	
  Section 7.03.  Compliance Certificates

  	
  51

  
	
  Section 7.04.  Further Instruments and Acts

  	
  51

  



 


ii

















 


	
  Section 7.05.  Maintenance of Corporate Existence

  	
  51

  
	
  Section 7.06.  Stay, Extension and Usury Laws

  	
  51

  
	
  Section 7.07.  Maintenance of Office or Agency

  	
  51

  
	
   

  	
   

  
	
  Article 8

  	
   

  
	
  CONSOLIDATION; MERGER; CONVEYANCE; TRANSFER
  OR LEASE

  	
   

  
	
   

  	
   

  
	
  Section 8.01.  Company May Consolidate, Etc., Only on Certain Terms

  	
  52

  
	
  Section 8.02.  Successor Substituted

  	
  52

  
	
   

  	
   

  
	
  Article 9

  	
   

  
	
  DEFAULT AND REMEDIES

  	
   

  
	
   

  	
   

  
	
  Section 9.01.  Events of Default

  	
  53

  
	
  Section 9.02.  Acceleration

  	
  55

  
	
  Section 9.03.  Other Remedies

  	
  56

  
	
  Section 9.04.  Waiver of Defaults and Events of Default

  	
  56

  
	
  Section 9.05.  Control by Majority

  	
  56

  
	
  Section 9.06.  Limitations on Suits

  	
  57

  
	
  Section 9.07.  Rights of Holders to Receive Payment and to Convert

  	
  57

  
	
  Section 9.08.  Collection Suit by Trustee

  	
  57

  
	
  Section 9.09.  Trustee May File Proofs of Claim

  	
  57

  
	
  Section 9.10.  Priorities

  	
  58

  
	
  Section 9.11.  Undertaking for Costs

  	
  58

  
	
   

  	
   

  
	
  Article 10

  	
   

  
	
  TRUSTEE

  	
   

  
	
   

  	
   

  
	
  Section 10.01.  Obligations of Trustee

  	
  59

  
	
  Section 10.02.  Rights of Trustee

  	
  60

  
	
  Section 10.03.  Individual Rights of Trustee

  	
  61

  
	
  Section 10.04.  Trustee’s Disclaimer

  	
  62

  
	
  Section 10.05.  Notice of Default or Events of Default

  	
  62

  
	
  Section 10.06.  Reports by Trustee to Holders

  	
  62

  
	
  Section 10.07.  Compensation and Indemnity

  	
  62

  
	
  Section 10.08.  Replacement of Trustee

  	
  63

  
	
  Section 10.09.  Successor Trustee by Merger, Etc.

  	
  64

  
	
  Section 10.10.  Eligibility; Disqualification

  	
  64

  
	
  Section 10.11.  Preferential Collection of Claims Against Company

  	
  64

  
	
   

  	
   

  
	
  Article 11

  	
   

  
	
  SATISFACTION AND DISCHARGE OF INDENTURE

  	
   

  
	
   

  	
   

  
	
  Section 11.01.  Satisfaction and Discharge of Indenture

  	
  65

  
	
  Section 11.02.  Application of Trust Money

  	
  66

  
	
  Section 11.03.  Repayment to Company

  	
  66

  
	
  Section 11.04.  Reinstatement

  	
  66

  



 


iii

















 


	
  Article 12

  	
   

  
	
  AMENDMENTS; SUPPLEMENTS AND WAIVERS

  	
   

  
	
   

  	
   

  
	
  Section 12.01.  Without Consent of Holders

  	
  66

  
	
  Section 12.02.  With Consent of Holders

  	
  67

  
	
  Section 12.03.  Compliance with Trust Indenture Act

  	
  68

  
	
  Section 12.04.  Revocation and Effect of Consents

  	
  68

  
	
  Section 12.05.  Notation on or Exchange of Securities

  	
  68

  
	
  Section 12.06.  Trustee to Sign Amendments, Etc.

  	
  69

  
	
  Section 12.07.  Effect of Supplemental Indentures

  	
  69

  
	
   

  	
   

  
	
  Article 13

  	
   

  
	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  
	
  Section 13.01.  Trust Indenture Act Controls

  	
  69

  
	
  Section 13.02.  Notices

  	
  69

  
	
  Section 13.03.  Communications by Holders with Other Holders

  	
  71

  
	
  Section 13.04.  Certificate and Opinion as to Conditions Precedent

  	
  71

  
	
  Section 13.05.  Record Date for Vote or Consent of Holders of Securities

  	
  72

  
	
  Section 13.06.  Rules by Trustee, Paying Agent, Registrar and Conversion Agent

  	
  72

  
	
  Section 13.07.  Legal Holidays

  	
  72

  
	
  Section 13.08.  Governing Law

  	
  72

  
	
  Section 13.09.  No Adverse Interpretation of Other Agreements

  	
  72

  
	
  Section 13.10.  No Recourse Against Others

  	
  72

  
	
  Section 13.11.  No Security Interest Created

  	
  72

  
	
  Section 13.12.  Successors

  	
  72

  
	
  Section 13.13.  Multiple Counterparts

  	
  73

  
	
  Section 13.14.  Separability

  	
  73

  
	
  Section 13.15.  Table of Contents, Headings, Etc.

  	
  73

  
	
  Section 13.16.  Waiver of Jury Trial

  	
  73

  
	
  Section 13.17.  Force Majeure

  	
  73

  
	
   

  	
   

  
	
  Exhibit A

  	
  A-1

  



 


iv

















 


CROSS REFERENCE TABLE*


 


	
  TIA Section

  	
   

  	
  Indenture Section

  
	
   

  	
   

  	
   

  
	
  Section 310

  	
   

  	
  13.01

  
	
  310(a)(1)

  	
   

  	
  10.10

  
	
  (a)(2)

  	
   

  	
  10.10

  
	
  (a)(3)

  	
   

  	
  N/A

  
	
  (a)(4)

  	
   

  	
  N/A

  
	
  (a)(5)

  	
   

  	
  10.10

  
	
  (b)

  	
   

  	
  10.10

  
	
  (c)

  	
   

  	
  N/A

  
	
   

  	
   

  	
   

  
	
  Section 311

  	
   

  	
  13.01

  
	
  311(a)

  	
   

  	
  10.11

  
	
  (b)

  	
   

  	
  10.11

  
	
  (c)

  	
   

  	
  N/A

  
	
   

  	
   

  	
   

  
	
  Section 312

  	
   

  	
  13.01

  
	
  312(a)

  	
   

  	
  N/A

  
	
  (b)

  	
   

  	
  13.03

  
	
  (c)

  	
   

  	
  13.03

  
	
   

  	
   

  	
   

  
	
  Section 313

  	
   

  	
  13.01

  
	
  313(a)

  	
   

  	
  10.06(a)

  
	
  (b)(1)

  	
   

  	
  N/A

  
	
  (b)(2)

  	
   

  	
  10.06(a)

  
	
  (c)

  	
   

  	
  10.06(a)

  
	
  (d)

  	
   

  	
  10.06(a)

  
	
   

  	
   

  	
   

  
	
  Section 314

  	
   

  	
  13.01

  
	
  314(a)

  	
   

  	
  7.02(a)

  
	
  (b)

  	
   

  	
  N/A

  
	
  (c)(1)

  	
   

  	
  13.04

  
	
  (c)(2)

  	
   

  	
  13.04

  
	
  (c)(3)

  	
   

  	
  N/A

  
	
  (d)

  	
   

  	
  N/A

  
	
  (e)

  	
   

  	
  13.04

  
	
  (f)

  	
   

  	
  N/A

  
	
   

  	
   

  	
   

  
	
  Section 315

  	
   

  	
  13.01

  
	
  315(a)

  	
   

  	
  10.01(b)

  
	
  (b)

  	
   

  	
  10.05

  
	
  (c)

  	
   

  	
  10.01(a)

  
	
  (d)(1)

  	
   

  	
  10.01(d)

  



 


v

















 


	
  TIA Section

  	
   

  	
  Indenture Section

  
	
   

  	
   

  	
   

  
	
  (d)(2)

  	
   

  	
  10.01(d)

  
	
  (d)(3)

  	
   

  	
  10.01(d)

  
	
  (e)

  	
   

  	
  9.11

  
	
   

  	
   

  	
   

  
	
  Section 316

  	
   

  	
  13.01

  
	
  316(a)

  	
   

  	
  2.09

  
	
  316(a)(1)(A)

  	
   

  	
  9.05

  
	
  316(a)(1)(B)

  	
   

  	
  9.04

  
	
  316(a)(2)

  	
   

  	
  N/A

  
	
  (b)

  	
   

  	
  9.07

  
	
  (c)

  	
   

  	
  13.05

  
	
   

  	
   

  	
   

  
	
  Section 317

  	
   

  	
  13.01

  
	
  317(a)(1)

  	
   

  	
  9.08

  
	
  317(a)(2)

  	
   

  	
  9.09

  
	
  317(b)

  	
   

  	
  2.04

  
	
   

  	
   

  	
   

  
	
  Section 318(a)

  	
   

  	
  13.01

  
	
  318(c)

  	
   

  	
  13.01

  



 






  * This Cross-Reference Table
shall not, for any purpose, be deemed a part of this Indenture.


** N.A.  means Not Applicable


 


vi

















 


THIS INDENTURE dated as of January     , 2008 is between Theravance, Inc., a
corporation duly organized under the laws of the State of Delaware (the
“Company”), and The Bank of New York Trust Company, N.A., a national banking
association duly organized and existing under the laws of the United States of
America, as Trustee (the “Trustee”).


 


In
consideration of the purchase of the Securities (as defined herein) by the
Holders thereof, both parties agree as follows for the benefit of the other and
for the equal and ratable benefit of the Holders of the Company’s      % Convertible Subordinated Notes Due                 , 2015.


ARTICLE
1

DEFINITIONS AND INCORPORATION BY REFERENCE


Section 1.01.  Definitions.


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


“Agent” means
any Registrar, Paying Agent or Conversion Agent.


“Applicable
Procedures” means, with respect to any transfer or exchange of beneficial
ownership interests in a Global Security, the rules and procedures of the
Depositary, to the extent applicable to such transfer or exchange.


“Beneficial
Ownership” means the definition such term is given in accordance with Rule 13d-3
promulgated by the SEC under the Exchange Act.


“Board of
Directors” means either the board of directors of the Company or any committee
of the Board of Directors authorized to act for it with respect to this
Indenture.


“Business Day”
means any weekday that is not a day on which banking institutions in the City of
New York are authorized or obligated to close.


“Capital
Stock” of any Person means any and all shares, interests, rights to purchase,
warrants, options, participations or other equivalents of or interests in
(however designated) equity of such Person, but excluding any debt securities
convertible into such equity.


“Cash” or “cash” means such coin or currency
of the United States as at any time of payment is legal tender for the payment
of public and private debts.


 

















 


“Certificated
Security” means a Security that is in substantially the form attached as Exhibit A
but that does not include the legend or the schedule called for by footnote 1
thereof.


“Change of
Control” means the occurrence of any of the following after the original
issuance of the Securities: (i) the acquisition by any Person of
Beneficial Ownership, directly or indirectly, through a purchase, merger or
other acquisition transaction or series of transactions, of shares of the
Company’s Capital Stock entitling that Person to exercise 50% or more of the
total voting power of all shares of the Company’s Capital Stock entitled to
vote generally in elections of directors, other than any acquisition by the
Company, any of its subsidiaries or any of its employee benefit plans; (ii) the
consolidation or merger of the Company with or into any other Person, any
merger of another Person into the Company, any reclassification or
recapitalization, or any conveyance, transfer, sale, lease or other disposition
of all or substantially all of the Company’s properties and assets to another
Person other than to one or more of the Company’s wholly-owned subsidiaries, provided that this clause (ii) shall not apply to (A) any
transaction (x) that does not result in any reclassification, conversion,
exchange or cancellation of outstanding shares of the Company’s Capital Stock
and (y) pursuant to which holders of the Company’s Capital Stock
immediately prior to the transaction have the entitlement to exercise, directly
or indirectly, 50% or more of the total voting power of all shares of the
Company’s Capital Stock entitled to vote generally in elections of directors of
the continuing or surviving Person immediately after the transaction; or (B) any
merger solely for the purpose of changing the Company’s jurisdiction of
incorporation and resulting in a reclassification, conversion or exchange of
outstanding shares of Common Stock solely into shares of common stock of the
surviving entity; (iii) if, during any consecutive two-year period,
individuals who at the beginning of that two-year period constituted the
Company’s Board of Directors, together with any new directors whose election to
the Company’s Board of Directors, or whose nomination for election by the
Company’s stockholders, was approved by a vote of a majority of the directors
then still in office who were either directors at the beginning of such period
or whose election or nomination for election was previously so approved, cease
for any reason to constitute a majority of the Company’s Board of Directors then
in office; or (iv) the stockholders of the Company pass a resolution
approving a plan of liquidation or dissolution. 
Notwithstanding anything to the contrary set forth herein, it will not
otherwise constitute a Change of Control if at least 90% of the consideration
for the Common Stock (excluding cash payments for fractional shares and cash
payments made in respect of dissenters’ appraisal rights) in the transaction or
transactions constituting a Change of Control consists of common stock or
American Depositary Shares representing shares of common stock, in each case
which are traded on a U.S. national securities exchange, or which will be so
traded or quoted when issued or exchanged in connection with the Change of
Control, and as a result of such transaction or transactions the Securities
become convertible solely into such consideration; provided that, with respect
to an entity organized under the laws of a jurisdiction outside the United
States, such entity has a worldwide total market capitalization (calculated in
U.S. dollars) of its equity securities of at least two times the market
capitalization of the Company before giving effect to the consolidation or
merger.


“Closing Price” means on any Trading Day, the
reported last sale price per share (or if no last sale price is reported, the
average of the bid and ask prices per share or, if more than one in either
case, the average of the average bid and the average ask prices per share) on
such date 


 


2

















 


reported by the Nasdaq Global Market or, if the Common Stock (or the
applicable security) is not quoted on the Nasdaq Global Market, as reported by
the principal national securities exchange on which the Common Stock (or such
other security) is listed, or if no such prices are available, the Closing
Price per share shall be the fair value of a share of Common Stock (or such
other security) as reasonably determined by the Board of Directors (which
determination shall be conclusive and shall be evidenced by an Officers’
Certificate delivered to the Trustee).


“Common Stock”
means the common stock of the Company, par value $0.01, as it exists on the
date of this Indenture and any shares of any class or classes of Capital Stock
of the Company resulting from any reclassification or reclassifications
thereof, or, in the event of a merger, consolidation or other similar
transaction involving the Company that is otherwise permitted hereunder in
which the Company is not the surviving corporation, the common stock, common
equity interests, ordinary shares or depositary shares or other certificates
representing common equity interests of such surviving corporation or its
direct or indirect parent corporation, and which have no preference in respect
of dividends or of amounts payable in the event of any voluntary or involuntary
liquidation, dissolution or winding-up of the Company and which are not subject
to redemption by the Company; provided, however,
that if at any time there shall be more than one such resulting class, the
shares of each such class then so issuable on conversion of Securities shall be
substantially in the proportion which the total number of shares of such class
resulting from all such reclassifications bears to the total number of shares
of all such classes resulting from all such reclassifications.


“Company”
means the party named as such in the first paragraph of this Indenture until a
successor replaces it pursuant to the applicable provisions of this Indenture,
and thereafter “Company” shall mean such successor.


“Conversion
Price” per share of Common Stock as of any day means the result obtained by
dividing (i) $1,000 by (ii) the then applicable Conversion Rate,
rounded to the nearest cent.


“Conversion
Rate” means the rate at which shares of Common Stock shall be delivered upon
conversion, which rate shall be initially              shares of Common Stock for each
$1,000 principal amount of Securities, as adjusted from time to time pursuant
to the provisions of this Indenture.


“Corporate
Trust Office” means the principal office of the Trustee at which at any time
its corporate trust business shall be administered, which office at the date
hereof is located at 700 South Flower Street, Suite 500, Los Angeles, CA
90017, Attention: Corporate Unit, or such other address as the Trustee may
designate from time to time by notice to the Holders and the Company, or the
principal corporate trust office of any successor Trustee (or such other
address as such successor Trustee may designate from time to time by notice to
the Holders and the Company).


“Default” means, when used with respect to
the Securities, any event that is or, after notice or passage of time, or both,
would be, an Event of Default.


 


3

















 


“Designated
Senior Indebtedness” means the Company’s obligations under any particular
Senior Indebtedness in which the instrument creating or evidencing the same or
the assumption or guarantee thereof (or related agreements or documents to
which the Company is a party) expressly provides that such Indebtedness shall
be “Designated Senior Indebtedness” for purposes of this Indenture (provided that such instrument, agreement or other document
may place limitations and conditions on the right of such Senior Indebtedness
to exercise the rights of Designated Senior Indebtedness).  If any payment made to any holder of any
Designated Senior Indebtedness or its representative with respect to such
Designated Senior Indebtedness is rescinded or must otherwise be returned by
such holder or representative of such holder upon the insolvency, bankruptcy or
reorganization of the Company or otherwise, the reinstated Indebtedness of the
Company arising as a result of such rescission or return shall constitute
Designated Senior Indebtedness effective as of the date of such rescission or
return.


“Exchange Act”
means the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder, as in effect from time to time.


“Final
Maturity Date” means January 15, 2015.


“Fundamental
Change” means the occurrence of a Change of Control or a Termination of Trading
following the original issuance of the Securities.


“Fundamental
Change Effective Date” means the date on which any Fundamental Change becomes
effective.


“Fundamental
Change Repurchase Price” of any Security, means 100% of the principal amount of
the Security to be purchased plus accrued and unpaid interest, if any, to, but
excluding, the Fundamental Change Repurchase Date.


“GAAP” means
generally accepted accounting principles in the United States of America as in
effect from time to time, including those set forth in (i) the opinions
and pronouncements of the Accounting Principles Board of the American Institute
of Certified Public Accountants, (ii) the statements and pronouncements of
the Financial Accounting Standards Board, (iii) such other statements by
such other entity as approved by a significant segment of the accounting
profession and (iv) the rules and regulations of the SEC governing
the inclusion of financial statements (including pro forma financial
statements) in registration statements filed under the Securities Act and
periodic reports required to be filed pursuant to Section 13 of the
Exchange Act, including opinions and pronouncements in staff accounting
bulletins and similar written statements from the accounting staff of the SEC.


“Global Security” means a Security in global
form that is in substantially the form attached as Exhibit A and that
includes the legend and schedule called for in footnote 1 thereof and which is
deposited with the Depositary or its custodian and registered in the name of
the Depositary or its nominee.


 


4

















 


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


“Indebtedness”
means, without duplication:


(i)            all of the Company’s
indebtedness, obligations and other liabilities (contingent or otherwise) for
borrowed money (including obligations in respect of overdrafts, foreign
exchange contracts, currency exchange agreements, interest rate protection
agreements, and any loans or advances from banks, whether or not evidenced by
notes or similar instruments) or evidenced by credit or loan agreements, bonds,
debentures, notes or similar instruments (whether or not the recourse of the
lender is to the whole of the Company’s assets or to only a portion thereof),
other than any trade accounts payable or other accrued current expense incurred
in the ordinary course of business in connection with the obtaining of
materials or services;


(ii)           all of the Company’s
reimbursement obligations and other liabilities (contingent or otherwise) with
respect to letters of credit, bank guarantees or bankers’ acceptances;


(iii)          all of the Company’s
obligations and liabilities (contingent or otherwise)


(A)          in respect of leases
required, in conformity with GAAP, to be accounted for as capitalized lease
obligations on the Company’s balance sheet,


(B)           as lessee under other
leases for facilities equipment (and related assets leased together therewith),
whether or not capitalized, entered into or leased for financing purposes (as
determined by the Company), or


(C)           under any lease or
related document (including a purchase agreement) in connection with the lease
of real property or improvements (or any personal property included as part of
any such lease) that provides that the Company is contractually obligated to
purchase or cause a third party to purchase the leased property and thereby
guarantee a minimum residual value of the leased property to the lessor and all
of the Company’s obligations under such lease or related document to purchase
or to cause a third party to purchase such leased property, (whether or not
such lease transaction is characterized as an operating lease or a capitalized
lease in accordance with GAAP);


(iv)          all of the Company’s
obligations (contingent or otherwise) with respect to an interest rate,
currency or other swap, cap, floor or collar agreement, hedge agreement,
forward contract, or other similar instrument or foreign currency hedge,
exchange, purchase or similar instrument or agreement;


(v)           all of the Company’s
direct or indirect guarantees, agreements to be jointly liable or similar
agreements in respect of, and obligations or liabilities (contingent or 


 


5

















 


otherwise) to purchase or otherwise acquire
or otherwise assure a creditor against loss in respect of, indebtedness,
obligations or liabilities of another person of the kind described in clauses (i) through
(iv);


(vi)          any indebtedness or
other obligations described in clauses (i) through (v) secured by any
mortgage, pledge, lien or other encumbrance existing on property which is owned
or held by the Company, regardless of whether the indebtedness or other
obligation secured thereby shall be assumed by the Company; and


(vii)         any and all deferrals,
renewals, extensions and refundings of, or amendments, modifications or
supplements to, any indebtedness, obligation or liability of the kind described
in clauses (i) through (vi).


“Indenture”
means this Indenture as amended or supplemented from time to time pursuant to
the terms of this Indenture, including the provisions of the TIA that are
automatically deemed to be a part of this Indenture by operation of the TIA.


“Interest
Payment Date” means January 15 and July 15 of each year, commencing July 15,
2008.


“Issue Date”
of any Security means the date on which the Security was originally issued or
deemed issued as set forth on the face of the Security.


“Last Reported
Sale Price” on any date means the closing sale price per share of the Common
Stock (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 asked prices) on that date as reported in composite transactions
for the principal U.S.  national or
regional securities exchange on which the Common Stock is listed for trading.  If the Common Stock is not listed for trading
on a U.S.  national or regional
securities exchange on the relevant date, the “Last Reported Sale Price” will
be the last quoted bid price for the Common Stock in the over-the-counter
market on the relevant date as reported by the National Quotation Bureau or similar
organization.  If the Common Stock is not
so quoted, the “Last Reported Sale Price” will be the average of the mid-point
of the last bid and ask prices for the Common Stock on the relevant date from
each of at least three nationally recognized independent investment banking
firms selected by the Company for this purpose.


“Officer”
means the Chairman of the Board, the Chief Executive Officer, the President,
any Senior Vice President, the Chief Financial Officer, the Controller, the
Secretary, or any Assistant Controller or any Assistant Secretary of the
Company designated by one of the former officers.


“Officers’ Certificate” means a certificate
signed on behalf of the Company by two Officers; provided,
however, that for purposes of Sections 5.11 and 7.03, “Officers’
Certificate” means a certificate signed by (a) the principal executive
officer, principal financial officer or principal accounting officer of the
Company and (b) one other officer.


 


6

















 


“Opinion of
Counsel” means a written opinion from legal counsel.  The counsel may be an employee of or counsel
to the Company.


“Person” or
“person” means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization, government or any agency or political subdivision thereof or any
syndicate or group that would be deemed to be a “person” under Section 13(d)(3) of
the Exchange Act or any other entity.


“Principal” or
“principal” of a debt security, including the Securities, means the principal
of the security plus, when appropriate, the premium, if any, on the security.


“Redemption
Date” shall mean the date specified for redemption of the Securities in
accordance with the terms of the Securities and Article 3 hereof.


“Regular
Record Date” means, with respect to each Interest Payment Date, the January 1
or July 1, as the case may be, next preceding such Interest Payment Date.


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


“SEC” means
the Securities and Exchange Commission.


“Securities”
means the up to $150,000,000 aggregate principal amount ($172,500,000 aggregate
principal amount if the Underwriters exercise their over-allotment option to
purchase up to an additional $22,500,000 aggregate principal amount of notes in
full) of         % Convertible
Subordinated Notes due 2015, or any of them (each a “Security”), as amended or
supplemented from time to time, that are issued under this Indenture.


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


“Securities
Custodian” means the Trustee, as custodian with respect to the Securities in
global form, or any successor thereto.


“Senior Indebtedness” means the principal of,
premium, if any, interest (including all interest accruing subsequent to the
commencement of any bankruptcy or similar proceeding, whether or not a claim
for postpetition interest is allowable as a claim in any such proceeding) and
rent payable on or in connection with, and all fees, costs, expenses and other
amounts accrued or due on or in connection with, Indebtedness of the Company,
whether secured or unsecured, absolute or contingent, due or to become due,
outstanding on the date of this Indenture or thereafter created, incurred, assumed,
guaranteed or in effect guaranteed by the Company, including all deferrals,
renewals, extensions or refundings of, or amendments, 


 


7

















 


modifications or supplements to, the foregoing, unless in the case of
any particular Indebtedness the instrument creating or evidencing the same or
the assumption or guarantee thereof expressly provides that such Indebtedness
shall not be senior in right of payment to the Securities or expressly provides
that such Indebtedness is on the same basis or junior to the Securities.  Senior Indebtedness does not include:


(i)            Indebtedness that
expressly provides that such Indebtedness shall not be senior in right of
payment to the Securities or expressly provides that such Indebtedness is on
the same basis or junior in right of payment to the Securities;


(ii)           Indebtedness that is
expressly subordinated to any Senior Indebtedness;


(iii)          Indebtedness
subordinated by operation of law;


(iv)          trade payables and
accrued expenses of the Company (including, without limitation, accrued
compensation and accrued restructuring charges) or deferred purchase price for
goods, service or materials purchased or provided in the ordinary course of
business;


(v)           lease obligations other
than those described in clause (iii) of the definition of “Indebtedness”
above;


(vi)          any Indebtedness of the
Company to or among any of its subsidiaries; and


(vii)         any obligation for
federal, state, local or other taxes.


“Stock Price”
means the price paid, or deemed to be paid, per share of the Common Stock in
connection with a Fundamental Change as determined pursuant to Section 4.01(e).


“Subsidiary”
means, in respect of any Person, any corporation, association, partnership or
other business entity of which more than 50% of the total voting power of
shares of Capital Stock or other interests (including partnership interests)
entitled (without regard to the occurrence of any contingency) to vote in the
election of directors, managers, general partners or trustees thereof is at the
time owned or controlled, directly or indirectly, by (a) such Person; (b) such
Person and one or more Subsidiaries of such Person; or (c) one or more
Subsidiaries of such Person.


“Termination of Trading” means the
termination (but not the temporary suspension) of trading of the Common Stock,
which will be deemed to have occurred if the Common Stock or other common stock
into which the Securities are convertible is neither listed for trading on a
United States national securities exchange nor approved for listing on any
United States system of automated dissemination of quotations of securities
prices, or traded in over-the-counter securities markets, and no American
Depository Shares or similar instruments for such Common Stock or such other
common stock into which the Securities are convertible are so listed or
approved for listing in the United States.


 


8

















 


“TIA” means
the Trust Indenture Act of 1939, as amended, and the rules and regulations
thereunder as in effect on the date of this Indenture, except to the extent
that the Trust Indenture Act or any amendment thereto expressly provides for
application of the Trust Indenture Act as in effect on another date.


“Trading Day”
means any day on which the Nasdaq Global Market or, if the Common Stock is not
quoted on the Nasdaq Global Market, the principal national securities exchange
on which the Common Stock is listed is open for trading or, if the Common Stock
is not so listed, admitted for trading or quoted, any Business Day.  A Trading Day only includes those days that
have a scheduled closing time of 4:00 p.m. 
(New York City time) or the then standard closing time for regular
trading on the relevant exchange or trading system.


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


“Underwriters”
means Merrill Lynch, Pierce, Fenner & Smith Incorporated and Goldman,
Sachs & Co.


“Vice
President” when used with respect to the Company or the Trustee, means any vice
president, whether or not designated by a number or a word or words added
before or after the title “vice president.”


“Voting Stock”
of a Person means all classes of Capital Stock or other interests (including
partnership interests) of such Person then outstanding and normally entitled
(without regard to the occurrence of any contingency within the control of such
person to satisfy) to vote in the election of directors, managers or trustees
thereof.


Section 1.02.  Other Definitions.


 


	
  Term

  	
   

  	
  Defined in 

  Section

  	
   

  
	
  “Agent Members”

  	
   

  	
  2.01

  	
   

  
	
  “Bankruptcy Law”

  	
   

  	
  9.01

  	
   

  
	
  “Business Combination”

  	
   

  	
  5.10

  	
   

  
	
  “Company Order”

  	
   

  	
  2.02

  	
   

  
	
  “Conversion Agent”

  	
   

  	
  2.03

  	
   

  
	
  “Conversion Date”

  	
   

  	
  5.02

  	
   

  
	
  “Current Market Price”

  	
   

  	
  5.06

  	
   

  
	
  “DTC”

  	
   

  	
  2.01

  	
   

  
	
  “Depositary”

  	
   

  	
  2.01

  	
   

  



 


9

















 


	
  Term

  	
   

  	
  Defined in 

  Section

  	
   

  
	
  “Determination Date”

  	
   

  	
  5.06

  	
   

  
	
  “Distributed Securities”

  	
   

  	
  5.06

  	
   

  
	
  “Event of Default”

  	
   

  	
  9.01

  	
   

  
	
  “Expiration Date”

  	
   

  	
  5.06

  	
   

  
	
  “Expiration Time”

  	
   

  	
  5.06

  	
   

  
	
  “Fundamental Change Company Notice”

  	
   

  	
  4.01

  	
   

  
	
  “Fundamental Change Repurchase Date”

  	
   

  	
  4.01

  	
   

  
	
  “Fundamental Change Repurchase Notice”

  	
   

  	
  4.01

  	
   

  
	
  “Legal Holiday”

  	
   

  	
  13.07

  	
   

  
	
  “Legend”

  	
   

  	
  2.12

  	
   

  
	
  “Make Whole Premium”

  	
   

  	
  5.01

  	
   

  
	
  “Notice of Default”

  	
   

  	
  9.01

  	
   

  
	
  “Paying Agent”

  	
   

  	
  2.03

  	
   

  
	
  “Payment Blockage Notice”

  	
   

  	
  6.02

  	
   

  
	
  “Primary Registrar”

  	
   

  	
  2.03

  	
   

  
	
  “Purchase Agreement”

  	
   

  	
  2.01

  	
   

  
	
  “Purchased Shares”

  	
   

  	
  5.06

  	
   

  
	
  “record date”

  	
   

  	
  5.06

  	
   

  
	
  “Receiver”

  	
   

  	
  9.01

  	
   

  
	
  “Redemption Price”

  	
   

  	
  4.01(b)

  	
   

  
	
  “Registrar”

  	
   

  	
  2.03

  	
   

  
	
  “Resale Restriction Termination Date”

  	
   

  	
  2.12

  	
   

  
	
  “Rights”

  	
   

  	
  5.06

  	
   

  
	
  “Rights Plan”

  	
   

  	
  5.06

  	
   

  
	
  “Spinoff Securities”

  	
   

  	
  5.06

  	
   

  
	
  “Spinoff Valuation Period”

  	
   

  	
  5.06

  	
   

  
	
  “tender offer”

  	
   

  	
  5.06

  	
   

  
	
  “Triggering Distribution”

  	
   

  	
  5.06

  	
   

  



 


10

















 


Section 1.03.  Trust Indenture Act Provisions.


Whenever this
Indenture refers to a provision of the TIA, that provision is incorporated by
reference in and made a part of this Indenture. 
This Indenture shall also include those provisions of the TIA required
to be included herein by the provisions of the Trust Indenture Reform Act of
1990.  The following TIA terms used in
this Indenture have the following meanings:


“indenture
securities” means the Securities;


“indenture
security holder” means a Holder of a Security;


“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 other obligor on the
Securities.


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


Section 1.04.  Rules of Construction.


(a)        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 GAAP;


(iii)          words in the singular
include the plural, and words in the plural include the singular;


(iv)          provisions apply to
successive events and transactions;


(v)           the term “merger”
includes a statutory share exchange and the term “merged” has a correlative
meaning;


(vi)          the masculine gender
includes the feminine and the neuter;


(vii)         references to agreements
and other instruments include subsequent amendments thereto; and


(viii)        all “Article”, “Exhibit”
and “Section” references are to Articles, Exhibits and Sections, respectively,
of or to this Indenture unless otherwise specified herein, and 


 


11

















 


the terms “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.


ARTICLE
2

THE SECURITIES


Section 2.01.  Form and Dating.  The Securities and the Trustee’s
certificate of authentication shall be substantially in the respective forms
set forth in Exhibit A which Exhibit is incorporated in and
made part of this Indenture.  The
Securities may have notations, legends or endorsements required by law, stock
exchange or automated quotation system rule or regulation or usage.  The Company shall provide any such notations,
legends or endorsements to the Trustee in writing.  Each Security shall be dated the date of its
authentication.  The Securities are being
offered and sold by the Company pursuant to a Purchase Agreement dated January        , 2008 (the “Purchase Agreement”)
between the Company and the Underwriters. 
The terms and provisions contained in the Securities shall constitute, and
are hereby expressly made, a part of this Indenture, and the Company and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby.  However, to the extent any provision of any Security
conflicts with the express provisions of this Indenture, the provisions of this
Indenture shall govern and be controlling.


(a)        Global Securities.  All of the Securities shall be issued
initially in the form of one or more Global Securities, which shall be
deposited on behalf of the purchasers of the securities represented thereby
with the Trustee, at its Corporate Trust Office, as custodian for the
depositary, The Depository Trust Company (“DTC”, and such depositary, or any
successor thereto, being hereinafter referred to as the “Depositary”), and
registered in the name of its nominee, Cede & Co.  (or any successor thereto), for the accounts
of participants in the Depositary, duly executed by the Company and
authenticated by the Trustee as hereinafter provided.


(b)        Global Securities in
General.  Each Global Security
shall represent such of the outstanding Securities as shall be specified
therein and each shall provide that it shall represent the aggregate amount of
outstanding Securities from time to time endorsed thereon and that the
aggregate amount of outstanding Securities represented thereby may from time to
time be reduced or increased, as appropriate, to reflect replacements,
exchanges, redemption, purchases or conversions of such Securities.  Any adjustment of the aggregate principal
amount of a Global Security to reflect the amount of any increase or decrease
in the amount of outstanding Securities represented thereby shall be made by
the Trustee in accordance with instructions given by the Holder thereof as
required by Section 2.12 and shall be made on the records of the Trustee
and the Depositary.


Members of, or participants in, the
Depositary (“Agent Members”) shall have no rights under this Indenture with
respect to any Global Security held on their behalf by the Depositary or under
the Global Security, and the Depositary (including, for this purpose, its
nominee) may be treated by the Company, the Trustee and any agent of the
Company or the Trustee as the absolute 


 


12

















 


owner and Holder of such Global Security for all purposes
whatsoever.  Notwithstanding the
foregoing, nothing herein shall (i) 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 (ii) impair,
as between the Depositary and its Agent Members, the operation of customary
practices governing the exercise of the rights of a Holder of any Security.


(c)        Book Entry Provisions.  The Company shall execute and the Trustee
shall, in accordance with this Section 2.01(c), authenticate and deliver
initially one or more Global Securities that (i) shall be registered in
the name of the Depositary or its nominee, (ii) shall be delivered by the
Trustee to the Depositary or pursuant to the Depositary’s instructions and (iii) shall
bear legends substantially to the following effect:


“UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY 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 THE DEPOSITORY TRUST COMPANY (AND
ANY PAYMENT HEREON IS MADE TO CEDE & CO.  OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.  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 THEREOF.  THIS SECURITY IS EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE
ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND, UNLESS AND
UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE
FORM, THIS 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.”


Section 2.02.  Execution and Authentication.


(a)        The aggregate principal amount of Securities
which may be authenticated and delivered under this Indenture is limited,
pursuant to the Purchase Agreement, to $150,000,000 aggregate principal amount
($172,500,000 aggregate principal amount if the Underwriters exercise their
over-allotment option in full).


(b)        An Officer shall sign the
Securities for the Company by manual or facsimile signature.  Typographic and other minor errors or defects
in any such facsimile signature shall 


 


13

















 


not affect the validity or enforceability of any Security that has been
authenticated and delivered by the Trustee.


(c)        If an Officer whose signature is on a Security
no longer holds that office at the time the Trustee authenticates the Security,
the Security shall be valid nevertheless.


(d)        A Security shall not be valid until an
authorized signatory of the Trustee by manual signature signs the certificate
of authentication on the Security.  The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.


(e)        The Trustee shall authenticate and make
available for delivery Securities for original issue in the aggregate principal
amount of up to $150,000,000 aggregate principal amount ($172,500,000 aggregate
principal amount if the Underwriters exercise their over-allotment option in
full by executing an over-allotment exercise notice and delivering such executed
over-allotment exercise notice to the Trustee and the Company) upon receipt of
a written order or orders of the Company signed by an Officer of the Company (a
“Company Order”).  The Company Order
shall specify the amount of Securities to be authenticated, shall provide that
all such Securities will be represented by a Global Security and the date on
which each original issue of Securities is to be authenticated.


(f)         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 shall have the same
rights as an Agent to deal with the Company or an Affiliate of the Company.


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


Section 2.03.  Registrar, Paying Agent and Conversion Agent.


(a)        The Company shall maintain
one or more offices or agencies where Securities may be presented for
registration of transfer or for exchange (each, a “Registrar”), one or more
offices or agencies where Securities may be presented for payment (each, a
“Paying Agent”), one or more offices or agencies where Securities may be
presented for conversion (each, a “Conversion Agent”) and one or more offices
or agencies where notices and demands to or upon the Company in respect of the
Securities and this Indenture may be served. 
The Company will at all times maintain a Paying Agent, Conversion Agent,
Registrar and an office or agency where notices and demands to or upon the
Company in respect of the Securities and this Indenture may be served.  One of the Registrars (the “Primary
Registrar”) shall keep a register of the Securities and of their transfer and
exchange.  The Company shall provide
written notice to the Trustee of any Registrar, Securities Agent, Conversion
Agent or Paying Agent that is not also the Trustee.


 


14














 


(b)                                 The Company shall enter into an appropriate
agency agreement with any Agent not a party to this Indenture, provided that the Agent may be an Affiliate of the
Trustee.  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, Conversion Agent, or agent for service of notices and demands in
any place required by this Indenture, or fails to give the foregoing notice,
the Trustee shall act as such.  The
Company or any Affiliate of the Company may act as Paying Agent (except for the
purposes of Section 7.01 and Article 11).


 


(c)                                  The Company hereby initially designates the
Trustee as Paying Agent, Registrar, Securities Custodian and Conversion Agent,
and designates the Corporate Trust Office of the Trustee as an office or agency
where notices and demands to or upon the Company in respect of the Securities
and this Indenture shall be served.


 


Section 2.04.  Paying Agent to Hold Money in
Trust.  Prior to
12:00 p.m.  (noon), New York City
time, on each due date of the payment of principal of, or interest on, any
Securities, the Company shall deposit with the Paying Agent a sum sufficient to
pay such principal or interest so becoming due. 
Subject to Section 9.02, a Paying Agent shall hold in trust for the
benefit of Holders of Securities or the Trustee all money held by the Paying
Agent for the payment of principal of, or interest on, the Securities, and
shall notify the Trustee of any failure by the Company (or any other obligor on
the Securities) to make any such payment. 
If the Company or an Affiliate of the Company acts as Paying Agent, it
shall, before 12:00 p.m.  (noon),
New York City time, on each due date of the principal of, or interest on, any
Securities, segregate the money and hold it as a separate trust fund.  The Company at any time may require a Paying
Agent to pay all money held by it to the Trustee, and the Trustee may at any
time during the continuance of any Default, upon written request to a Paying
Agent, require such Paying Agent to pay forthwith to the Trustee all sums so
held in trust by such Paying Agent.  Upon
doing so, the Paying Agent (other than the Company) shall have no further
liability for the money.


 


Section 2.05.  Lists of Holders of
Securities.  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 Holders of Securities.  If the Trustee is not the Primary 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 Holders of Securities.


 


Section 2.06.  Transfer and Exchange.


 


(a)                                  Subject to compliance with any applicable
additional requirements contained in Section 2.12, when a Security is
presented to a Registrar with a request to register a transfer thereof or to
exchange such Security for an equal principal amount of Securities of other
authorized denominations, the Registrar shall register the transfer or make the
exchange as requested; provided, however,
that every Security presented or surrendered for registration of transfer or
exchange shall be duly endorsed or accompanied by an assignment form and, if 


 


15

















 


applicable, a transfer
certificate each in the form included in Exhibit A, and completed
in a manner satisfactory to the Registrar and duly executed by the Holder
thereof or its attorney duly authorized in writing.  To permit registration of transfers and
exchanges, upon surrender of any Security for registration of transfer or
exchange at an office or agency maintained pursuant to Section 2.03, the
Company shall execute and the Trustee shall authenticate Securities of a like
aggregate principal amount at the Registrar’s request.  Any exchange or transfer shall be without
charge, except that the Company or the Registrar may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto; provided that this sentence shall
not apply to any exchange pursuant to Section 2.10, 2.12(a), 4.05,
5.02(e) or 12.05.


 


(b)                                 Neither the Company, any Registrar nor the
Trustee shall be required to exchange or register a transfer of any Securities
or portions thereof in respect of which a Fundamental Change Repurchase Notice
has been delivered and not withdrawn by the Holder thereof (except, in the case
of the purchase of a Security in part, the portion thereof not to be
purchased).


 


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


 


(d)                                 Any Registrar appointed pursuant to
Section 2.03 shall provide to the Trustee such information as the Trustee
may reasonably require in connection with the delivery by such Registrar of
Securities upon transfer or exchange of Securities.


 


(e)                                  Each Holder of a Security agrees to indemnify
and hold harmless the Company and the Trustee against any liability that may
result from the transfer, exchange or assignment of such Holder’s Security in
violation of any provision of this Indenture and/or applicable United States
federal or state securities law.


 


(f)                                    The Trustee shall have no obligation or duty
to monitor, determine or inquire as to compliance with any restrictions on
transfer imposed under this Indenture or under applicable law with respect to
any transfer of any interest in any Security (including any transfers between or
among Agent Members or other beneficial owners of interests in any Global
Security) other than to require delivery of such certificates and other
documentation or evidence as are expressly required by, and to do so if and
when expressly required by the terms of, this Indenture, and to examine the
same to determine substantial compliance as to form with the express
requirements hereof.


 


Section 2.07.  Replacement Securities.


 


(a)                                  If any mutilated Security is surrendered to
the Company, a Registrar or the Trustee, and the Company, a Registrar and the
Trustee receive evidence to their satisfaction of the destruction, loss or
theft of any Security, and there is delivered to the Company, the applicable
Registrar and the Trustee such security or indemnity as will be required by
them to save each of them harmless, then, in the absence of notice to the
Company, such Registrar or the Trustee that 


 


16

















 


such Security has been
acquired by a bona fide purchaser, the Company shall execute, and upon its
written request the Trustee shall authenticate and deliver, in exchange for any
such mutilated Security or in lieu of any such destroyed, lost or stolen
Security, a new Security of like tenor and principal amount, bearing a number
not contemporaneously outstanding.


 


(b)                                 If any such mutilated, destroyed, lost or
stolen Security has become or is about to become due and payable, or is about
to be redeemed or purchased by the Company pursuant to Article 3 or 4, or
converted pursuant to Article 5, the Company in its discretion may,
instead of issuing a new Security, pay, redeem, purchase or convert such
Security, as the case may be.


 


(c)                                  Upon the issuance of any new Securities under
this Section 2.07, the Company may require the payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the reasonable fees and
expenses of the Trustee or the Registrar) in connection therewith.


 


(d)                                 Every new Security issued pursuant to this
Section 2.07 in lieu of any mutilated, destroyed, lost or stolen Security
shall constitute an original additional contractual obligation of the Company,
whether or not the mutilated, destroyed, lost or stolen Security shall be at
any time enforceable by anyone, and shall be entitled to all benefits of this
Indenture equally and proportionately with any and all other Securities duly
issued hereunder.


 


(e)                                  The provisions of this Section 2.07 are
(to the extent lawful) exclusive and shall preclude (to the extent lawful) all
other rights and remedies with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities.


 


Section 2.08.  Outstanding Securities.


 


(a)                                  Securities outstanding at any time are all
Securities authenticated by the Trustee, except for those canceled by it, those
redeemed or purchased pursuant to Article 3 or 4, those converted pursuant
to Article 5, those delivered to the Trustee for cancellation or
surrendered for transfer or exchange and those described in this
Section 2.08 as not outstanding.


 


(b)                                 If a Paying Agent (other than the Company or
an Affiliate of the Company) holds in respect of the outstanding Securities on
a Redemption Date, a Fundamental Change Repurchase Date or the Final Maturity
Date money sufficient to pay the principal of (including premium, if any) and
accrued interest on Securities (or portions thereof) payable on that date, then
on and after such Redemption Date, Fundamental Change Repurchase Date or Final
Maturity Date, as the case may be, such Securities (or portions thereof, as the
case may be) shall cease to be outstanding and cash interest on them shall
cease to accrue.


 


(c)                                  Subject to the restrictions contained in
Section 2.09, a Security does not cease to be outstanding because the
Company or an Affiliate of the Company holds the Security.


 


Section 2.09.  Treasury Securities.  In determining whether the Holders
of the required principal amount of Securities have concurred in any notice,
direction, waiver or consent, 


 


17

















 


Securities owned by the Company or any other
obligor on the Securities or by any Affiliate of the Company or of such other
obligor shall be disregarded, except that, for purposes of determining whether
the Trustee shall be protected in relying on any such notice, direction, waiver
or consent, only Securities which a Responsible Officer of the Trustee with
responsibility for this Indenture actually knows are so owned shall be so
disregarded.  Securities so owned which
have been pledged in good faith shall not be disregarded if the pledgee
establishes to the satisfaction of the Trustee the pledgee’s right so to act
with respect to the Securities and that the pledgee is not the Company or any other
obligor on the Securities or any Affiliate of the Company or of such other
obligor.


 


Section 2.10.  Temporary Securities.  Until definitive Securities are
ready for delivery, the Company may prepare and execute, and, upon receipt of a
Company Order, the Trustee shall authenticate and deliver, temporary
Securities.  Temporary Securities shall
be substantially in the form of definitive securities but may have variations
that the Company with the consent of the Trustee considers appropriate for
temporary Securities.  Without
unreasonable delay, the Company shall prepare and the Trustee shall
authenticate and deliver definitive Securities in exchange for temporary
Securities.


 


Section 2.11.  Cancellation.  The Company at any time may
deliver Securities to the Trustee for cancellation.  The Registrar, the Paying Agent and the
Conversion Agent shall forward to the Trustee or its agent any Securities
surrendered to them for transfer, exchange, redemption, purchase, payment or
conversion.  The Trustee and no one else
shall promptly cancel, in accordance with its standard procedures, all
Securities surrendered for transfer, exchange, redemption, purchase, payment,
conversion or cancellation and shall dispose of the cancelled Securities in
accordance with its customary procedures or deliver the canceled Securities to
the Company upon its request therefor. 
All Securities which are redeemed, purchased or otherwise acquired by
the Company or any of its Subsidiaries prior to the Final Maturity Date
pursuant to Article 3 or 4 shall be delivered to the Trustee for
cancellation, and the Company may not hold or resell such Securities or issue
any new Securities to replace any such Securities or any Securities that any
Holder has converted pursuant to Article 5.


 


Section 2.12.  Additional Transfer and
Exchange Requirements.


 


(a)                                  A Global Security may not be transferred, in
whole or in part, to any Person other than the Depositary or a nominee or any
successor thereof, and no such transfer to any such other Person may be registered;
provided that the foregoing shall not
prohibit any transfer of a Security that is issued in exchange for a Global
Security but is not itself a Global Security. 
No transfer of a Security to any Person shall be effective under this
Indenture or the Securities unless and until such Security has been registered
in the name of such Person. 
Notwithstanding any other provisions of this Indenture or the
Securities, transfers of a Global Security, in whole or in part, shall be made
only in accordance with this Section 2.12.


 


18

















 


(b)                       The provisions of clauses (i), (ii),
(iii) and (iv) below shall apply only to Global Securities:


 


(i)                                     Notwithstanding any other provisions of this
Indenture or the Securities, a Global Security shall not be exchanged in whole
or in part for a Security registered in the name of any Person other than the
Depositary or one or more nominees thereof; provided that a
Global Security may be exchanged for Securities registered in the names of any
person designated by the Depositary in the event that (A) the Depositary
has notified the Company that it is unwilling or unable to continue as
Depositary for such Global Security or such Depositary has ceased to be a “clearing agency” registered under the Exchange Act, and a
successor Depositary is not appointed by the Company within 90 days,
(B) the Company has provided the Depositary with written notice that it
has decided to discontinue use of the system of book-entry transfer through the
Depositary or any successor Depositary or (C) an Event of Default has
occurred and is continuing.  Any Global
Security exchanged pursuant to clauses (A) or (B) above shall be so
exchanged in whole and not in part, and any Global Security exchanged pursuant
to clause (C) above may be exchanged in whole or from time to time in part
as directed by the Depositary.  Any
Security issued in exchange for a Global Security or any portion thereof shall
be a Global Security; provided that
any such Security so issued that is registered in the name of a Person other
than the Depositary or a nominee thereof shall not be a Global Security.


 


(ii)                                  Securities issued in exchange for a Global
Security or any portion thereof shall be issued in definitive, fully-registered
book entry form, without interest coupons, shall have an aggregate principal
amount equal to that of such Global Security or portion thereof to be so
exchanged, shall be registered in such names and be in such authorized
denominations as the Depositary shall designate and shall bear any applicable
legend provided for herein.  Any Global
Security to be exchanged in whole shall be surrendered by the Depositary to the
Trustee, as Registrar.  With regard to
any Global Security to be exchanged in part, either such Global Security shall
be so surrendered for exchange or, if the Trustee is acting as custodian for
the Depositary or its nominee with respect to such Global Security, the
principal amount thereof shall be reduced, by an amount equal to the portion
thereof to be so exchanged, by means of an appropriate adjustment made on the
records of the Trustee.  Upon any such
surrender or adjustment, the Trustee shall authenticate and deliver the
Security issuable on such exchange to or upon the order of the Depositary or an
authorized representative thereof; provided, however,
that any Global Security surrendered for exchange shall be duly endorsed or
accompanied by a written instrument of transfer in accordance with the proviso
to the first paragraph of Section 2.06(a).


 


(iii)                               Subject to the provisions of clause (v) below, the registered
Holder may grant proxies and otherwise authorize any Person, including Agent
Members and persons that may hold interests through Agent Members, to take any
action which a Holder is entitled to take under this Indenture or the
Securities.


 


19

















 


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


 


(v)                                 Neither Agent Members nor any other Persons
on whose behalf Agent Members may act shall have any rights under this
Indenture with respect to any Global Security registered in the name of the
Depositary or any nominee thereof, or under any such Global Security, and the
Depositary or such nominee, as the case may be, may be treated by the Company,
the Trustee and any agent of the Company or the Trustee as the absolute owner
and holder of such Global 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 such nominee, as the case may be,
or impair, as between the Depositary, its Agent Members and any other person on
whose behalf an Agent Member may act, the operation of customary practices of
such Persons governing the exercise of the rights of a holder of any Security.


 


(c)                        In the event that Certificated Securities are
issued in exchange for beneficial interests in Global Securities and,
thereafter, the events or conditions specified in Section 2.12(b)(i) which
required such exchange shall cease to exist, the Company shall deliver notice
to the Trustee and to the Holders stating that Holders may exchange
Certificated Securities for interests in Global Securities by complying with
the procedures set forth in this Indenture and briefly describing such
procedures and the events or circumstances requiring that such notice be
given.  Thereafter, if Certificated
Securities are presented by a Holder to a Registrar with a request:


 


(i)                                     to register the transfer of such Certificated
Securities to a person who will take delivery thereof in the form of a
beneficial interest in a Global Security; or


 


(ii)                                  to exchange such Certificated Securities for
an equal principal amount of beneficial interests in a Global Security, which
beneficial interests will be owned by the Holder transferring such Certificated
Securities,


 


the Registrar shall register the transfer or
make the exchange as requested by canceling such Certificated Securities and
causing, or directing the Custodian to cause, the aggregate principal amount of
the applicable Global Security to be increased accordingly and, if no such
Global Security is then outstanding, the Company shall issue and the Trustee,
upon receipt of a Company Order, shall authenticate and deliver a new Global
Security; provided, however, that the Certificated
Securities presented or surrendered for registration of transfer or exchange
shall be duly endorsed or accompanied by a written instrument of transfer in
accordance with the proviso to the first paragraph of Section 2.06(a).


 


Section 2.13.  CUSIP Numbers.  The Company in issuing the
Securities may use one or more “CUSIP” numbers (if then generally in use), and,
if so, the Trustee shall use “CUSIP” numbers in notices of redemption or
purchase as a convenience to Holders; provided that
any 


 


20

















 


such notice may state that no representation
is made as to the correctness of such numbers either as printed on the
Securities or as contained in any notice of a redemption or purchase and that
reliance may be placed only on the other identification numbers printed on the
Securities, and any such redemption or purchase shall not be affected by any
defect in or omission of such numbers. 
The Company will promptly notify the Trustee of any change in the
“CUSIP” numbers.


 


ARTICLE 3


REDEMPTION


 


Section 3.01.  Right to Redeem; Notices to
Trustee.  (a) The
Securities may be redeemed in whole or in part at the option of the Company on
or after January 15, 2012 and prior to the Final Maturity Date, if the
Last Reported Sale Price of the Common Stock has been greater than or equal to
130% of the Conversion Price then in effect for at least 20 Trading Days during
any 30 consecutive Trading Day period prior to the date on which the Company
provides notice of redemption.


 


(b)                                 The redemption price at which the Securities
are redeemable (the “Redemption Price”) shall be payable in cash and shall be
equal to 100% of the principal amount of Securities being redeemed, together
with accrued and unpaid interest to, but excluding, the Redemption Date; provided, however, that if Securities are redeemed on a date
that is after the record date for an interest payment and on or prior to the
corresponding Interest Payment Date, the Company shall pay, on the
corresponding Interest Payment date, accrued and unpaid interest, if any, to
the Holder as of the close of business on the record date, and not to the
Holder submitting the Securities for redemption.


 


(c)                                  The Company may not redeem any Securities
unless all accrued and unpaid interest thereon has been or is simultaneously
paid for all semiannual periods or portions thereof terminating prior to the
Redemption Date.


 


(d)                                 Except as provided in this Section 3.01,
the Securities shall not be redeemable by the Company.


 


Section 3.02.  Selection of Securities to be
Redeemed.  If less than all
the Securities are to be redeemed, the Trustee shall select the Securities to
be redeemed pro rata or by lot or by any other method the Trustee considers
fair and appropriate (so long as such method is not prohibited by the
rules of the Nasdaq Global Select Market or any stock exchange on which
the Securities are then listed, as applicable). 
The Trustee shall make the selection within 7 days from its receipt of
the notice from the Company delivered pursuant to Section 3.03 from
outstanding Securities not previously called for redemption.


 


Securities and portions of them the Trustee selects
shall be in principal amounts of $1,000 or integral multiples of $1,000.  Provisions of this Indenture that apply to
Securities called for redemption in whole also apply to Securities called for
redemption in part.  The 


 


21

















 


 


Trustee shall notify the
Company promptly of the Securities or portions of Securities to be redeemed.


 


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


 


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


 


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


 


(i)                                     the
Redemption Date;


 


(ii)                                  the
Redemption Price;


 


(iii)                               the
Conversion Price;


 


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


 


(v)                                 that
Securities called for redemption may be converted at any time before the close
of business on the Business Day immediately preceding the Redemption Date;


 


(vi)                              that
Holders who want to convert Securities must satisfy the requirements set forth
therein and in this Indenture;


 


(vii)                           that
Securities called for redemption must be surrendered to the Paying Agent for
cancellation to collect the Redemption Price;


 


(viii)                        if fewer
than all the outstanding Securities are to be redeemed, the certificate numbers
(if such Securities are held other than in global form) and Principal Amounts
of the particular Securities to be redeemed;


 


(ix)                                that,
unless the Company defaults in making payment of such Redemption Price,
Interest will cease to accrue on and after the Redemption Date; and


 


(x)                                   the
CUSIP number of the Securities.


 


At the Company’s written request delivered at
least 45 days prior to the date such notice is to be given (unless a shorter
time period shall be acceptable to the Trustee), the Trustee shall give the notice
of redemption to each Holder of Securities to be redeemed in the Company’s name
and at the Company’s expense.


 


22

















 


Section 3.04.  Effect of Notice of
Redemption.  Once notice of
redemption is given, Securities called for redemption become due and payable on
the Redemption Date and at the Redemption Price stated in the notice except for
Securities that are converted in accordance with the terms of this
Indenture.  Upon surrender to the Paying
Agent, such Securities shall be paid at the Redemption Price stated in the
notice.


 


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


 


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


 


Section 3.07.  No Requirement to
Register.  Unless the Company
defaults in the payment of the Redemption Price, the Company shall not be
required to issue, register the transfer of, or convert any Securities after
the close of business on the Business Day immediately preceding the Redemption
Date or register the transfer or conversion of any Securities so selected for
redemption, in whole or in part, except the unredeemed portion of any Security
being redeemed in part.


 


ARTICLE
4


PURCHASE


 


Section 4.01.  Repurchase of Securities at Option of the
Holder upon a Fundamental Change.


 


(a)                                  If a Fundamental Change occurs prior to the
Final Maturity Date, each Holder of a Security shall have the right, at the
option of the Holder, to require the Company to repurchase for cash all or any
portion of the Securities of such Holder equal to $1,000 principal amount (or
an integral multiple thereof) at the Fundamental Change Repurchase Price, on
the date that is not less than 30 days nor more than 45 days after the date of
the Fundamental Change Company Notice pursuant to subsection 4.01(b) (the
“Fundamental Change Repurchase Date”); provided that,
if the Fundamental Change Repurchase Date is after the Regular Record Date for
an interest payment and on or prior to the corresponding Interest Payment Date,
the Company shall pay, on the corresponding Interest Payment date, accrued and
unpaid interest, if any, to the Holder as of 


 


23

















 


the close of
business on the Regular Record date, and not to the Holder submitting the
Securities for repurchase.


 


(b)                                 At least twenty (20) days prior to the
anticipated effective date of a Fundamental Change, if practicable, but in any
case as promptly as practicable, the Company shall mail a written notice of the
Fundamental Change and of the resulting repurchase right to the Trustee, Paying
Agent and to each Holder (and to beneficial owners as required by applicable
law) (the “Fundamental Change Company Notice”). 
The Fundamental Change Company Notice shall include the form of a
Fundamental Change Repurchase Notice to be completed by the Holder and shall
state:


 


(i)                                     the
events causing such Fundamental Change;


 


(ii)                                  the
date (or expected date) of such Fundamental Change;


 


(iii)                               the
last date by which the Fundamental Change Repurchase Notice must be delivered
to elect the repurchase option pursuant to this Section 4.01;


 


(iv)                              the
Fundamental Change Repurchase Date;


 


(v)                                 the
Fundamental Change Repurchase Price;


 


(vi)                              the
Holder’s right to require the Company to purchase the Securities;


 


(vii)                           the
name and address of each Paying Agent and Conversion Agent;


 


(viii)                        the then
effective Conversion Rate and any adjustments to the Conversion Rate resulting
from such Fundamental Change;


 


(ix)                                the
procedures that the Holder must follow to exercise conversion rights under Article 5
and that Securities as to which a Fundamental Change Repurchase Notice has been
given may be converted into Common Stock pursuant to Article 5 of this
Indenture only to the extent that the Fundamental Change Repurchase Notice has
been withdrawn in accordance with the terms of this Indenture;


 


(x)                                   the
procedures that the Holder must follow to exercise rights under this Section 4.01;


 


(xi)                                the
procedures for withdrawing a Fundamental Change Repurchase Notice;


 


(xii)                             that,
unless the Company fails to pay such Fundamental Change Repurchase Price,
Securities covered by any Fundamental Change Repurchase Notice will cease to be
outstanding and interest will cease to accrue on and after the Fundamental
Change Repurchase Date; and


 


(xiii)                          the
CUSIP number of the Securities.


 


24

















 


At the Company’s request, the Trustee shall
give such Fundamental Change Company Notice in the Company’s name and at the
Company’s expense; provided, that, in all cases, the text of such Fundamental
Change Company Notice shall be prepared by the Company.  If any of the Securities is in the form of a
Global Security, then the Company shall modify such notice to the extent
necessary to accord with the Applicable Procedures relating to the purchase of
Global Securities.


 


(c)                                  A Holder may exercise its rights specified in
Section 4.01(a) upon delivery of a written notice (which shall be in
substantially the form attached as Exhibit A under the heading
“Fundamental Change Repurchase Notice” and which may be delivered by letter,
overnight courier, hand delivery, facsimile transmission or in any other
written form and, in the case of Global Securities, may be delivered
electronically or by other means in accordance with the Depositary’s Applicable
Procedures) of the exercise of such rights (a “Fundamental Change Repurchase
Notice”) to the Company or any Paying Agent at any time prior to the close of
business on the Business Day next preceding the Fundamental Change Repurchase
Date, subject to extension to comply with applicable law.


 


(i)                                     The
Fundamental Change Repurchase Notice shall state:  (A) the certificate number (if such
Security is held other than in global form) of the Security which the Holder
will deliver to be purchased (or, if the Security is held in global form, any
other items required to comply with the Applicable Procedures), (B) the
portion of the principal amount of the Security which the Holder will deliver
to be purchased, in integral multiples of $1,000, and (C) that such
Security shall be purchased as of the Fundamental Change Repurchase Date
pursuant to the terms and conditions specified in the Securities and in this
Indenture.


 


(ii)                                  The
delivery of a Security for which a Fundamental Change Repurchase Notice has
been timely delivered to any Paying Agent and not validly withdrawn prior to,
on or after the Fundamental Change Repurchase Date (together with all necessary
endorsements) at the office of such Paying Agent shall be a condition to the
receipt by the Holder of the Fundamental Change Repurchase Price therefor.


 


(iii)                               The
Company shall only be obliged to purchase, pursuant to this Section 4.01,
a portion of a Security if the principal amount of such portion is $1,000 or an
integral multiple of $1,000 (provisions of this Indenture that apply to the
purchase of all of a Security also apply to the purchase of such portion of
such Security).


 


(iv)                              Notwithstanding
anything herein to the contrary, any Holder delivering to a Paying Agent the
Fundamental Change Repurchase Notice contemplated by this Section 4.01(c) shall
have the right to withdraw such Fundamental Change Repurchase Notice in whole
or in a portion thereof that is a principal amount of $1,000 or in an integral
multiple thereof at any time prior to the close of business on the Business Day
prior to the Fundamental Change Repurchase Date by delivery of a written notice
of withdrawal to the Paying Agent in accordance with Section 4.02.


 


25

















 


(v)                                 A
Paying Agent shall promptly notify the Company of the receipt by it of any
Fundamental Change Repurchase Notice or written withdrawal thereof.


 


(vi)                              Anything
herein to the contrary notwithstanding, in the case of Global Securities, any
Fundamental Change Repurchase Notice may be delivered or withdrawn and such
Securities may be surrendered or delivered for purchase in accordance with the
Applicable Procedures as in effect from time to time.


 


Section 4.02.  Effect of Fundamental Change Repurchase
Notice.


 


(a)                        Upon
receipt by any Paying Agent of a properly completed Fundamental Change
Repurchase Notice from a Holder, the Holder of the Security in respect of which
such Fundamental Change Repurchase Notice was given shall (unless such
Fundamental Change Repurchase Notice is withdrawn as specified in Section 4.02(b))
thereafter be entitled to receive the Fundamental Change Repurchase Price with
respect to such Security, subject to the occurrence of the Fundamental Change
Effective Date and an absence of an Event of Default, or a continuation thereof
(other than a Default in the payment of the Fundamental Change Repurchase
Price).  Such Fundamental Change
Repurchase Price shall be paid to such Holder promptly following the later of (i) the
Fundamental Change Repurchase Date (provided that
the conditions in Section 4.01 have been satisfied) and (ii) the time
of delivery of such Security to a Paying Agent by the Holder thereof in the
manner required by Section 4.01(c). 
Securities in respect of which a Fundamental Change Repurchase Notice
has been given by the Holder thereof may not be converted into shares of Common
Stock pursuant to Article 5 on or after the date of the delivery of such
Fundamental Change Repurchase Notice unless such Fundamental Change Repurchase
Notice has first been validly withdrawn in accordance with Section 4.02(b) with
respect to the Securities to be converted.


 


(b)                       A
Fundamental Change Repurchase Notice may be withdrawn by means of a written
notice (which may be delivered by mail, overnight courier, hand delivery,
facsimile transmission or in any other written form and, in the case of Global
Securities, may be delivered by other means in accordance with the Applicable
Procedures) of withdrawal delivered by the Holder to a Paying Agent at any time
prior to the close of business on the Business Day immediately prior to the
Fundamental Change Repurchase Date, specifying (i) the principal amount of
the Security or portion thereof (which must be a principal amount of $1,000 or
an integral multiple of $1,000 in excess thereof) with respect to which such
notice of withdrawal is being submitted, (ii) if certificated Securities
have been issued, the certificate number of the Security being withdrawn in
whole or in withdrawable part (or if the Securities are not certificated, such
written notice must comply with the Applicable Procedures) and (iii) the
portion of the principal amount of the Security that will remain subject to the
Fundamental Change Repurchase Notice, which portion must be a principal amount
of $1,000 or an integral multiple thereof.


 


26

















 


Section 4.03.  Deposit of Fundamental Change Repurchase
Price.


 


(a)                        On or
before 12:00 p.m.  (noon) New York
City time on the Business Day following the applicable Fundamental Change
Repurchase Date, the Company shall deposit with the Trustee or with a Paying
Agent (or if the Company or an Affiliate of the Company is acting as the Paying
Agent, shall segregate and hold in trust as provided in Section 2.04) an
amount of money (in immediately available funds if deposited on or after such
Fundamental Change Repurchase Date), sufficient to pay the aggregate
Fundamental Change Repurchase Price of all the Securities or portions thereof
that are to be purchased as of such Fundamental Change Repurchase Date.


 


(b)                       If a Paying
Agent or the Trustee holds, in accordance with the terms hereof, money
sufficient to pay the Fundamental Change Repurchase Price of any Security for
which a Fundamental Change Repurchase Notice has been tendered and not
withdrawn in accordance with this Indenture then, on the Business Day following
the applicable Fundamental Change Repurchase Date, such Security will cease to
be outstanding, whether or not the Security is delivered to the Paying Agent or
the Trustee, and interest and, shall cease to accrue, and the rights of the
Holder in respect of the Security shall terminate (other than the right to
receive the Fundamental Change Repurchase Price as aforesaid).  The Company shall publicly announce the
principal amount of Securities repurchased on or as soon as practicable after
the Fundamental Change Repurchase Date.


 


(c)                        The Paying
Agent will promptly return to the respective Holders thereof any Securities
with respect to which a Fundamental Change Repurchase Notice has been withdrawn
in compliance with this Indenture.


 


(d)                       If a
Fundamental Change Repurchase Date falls after a Regular Record Date and on or
before the related Interest Payment Date, then interest on the Securities
payable on such Interest Payment Date will be payable to the Holders in whose
names the Securities are registered at the close of business on such Regular
Record Date.


 


Section 4.04.  Repayment to the Company.  To the extent that the aggregate
amount of cash deposited by the Company pursuant to Section 4.03 exceeds
the aggregate Fundamental Change Repurchase Price of the Securities or portions
thereof that the Company is obligated to purchase, then promptly after the
Fundamental Change Repurchase Date the Trustee or a Paying Agent, as the case
may be, shall return any such excess cash to the Company.


 


Section 4.05.  Securities Purchased in
Part.  Any Security that is to
be purchased only in part shall be surrendered at the office of a Paying Agent,
and promptly after the Fundamental Change Repurchase Date, the Company shall
execute and the Trustee shall authenticate and deliver to the Holder of such
Security, without service charge, a new Security or Securities, of such
authorized denomination or denominations as may be requested by such Holder
(which must be equal to $1,000 principal amount or any integral thereof), in
aggregate principal amount equal to, and in exchange for, the portion of the
principal amount of the Security so surrendered that is not purchased.


 


27

















 


Section 4.06.  Compliance with Securities
Laws upon Purchase of Securities.  In
connection with any offer to purchase of Securities under Section 4.01,
the Company shall (a) comply with Rule 13e-4 and Rule 14e-1 (or
any successor to either such Rule), and any other tender offer rules, if
applicable, under the Exchange Act, (b) file the related Schedule TO (or
any successor or similar schedule, form or report) if required under the
Exchange Act, and (c) otherwise comply with all federal and state
securities laws in connection with such offer to purchase or purchase of
Securities, all so as to permit the rights of the Holders and obligations of
the Company under Sections 4.01 through 4.04 to be exercised in the time and in
the manner specified therein.  To the
extent that compliance with any such laws, rules and regulations would
result in a conflict with any of the terms hereof, this Indenture is hereby
modified to the extent required for the Company to comply with such laws, rules and
regulations.


 


Section 4.07.  Purchase of Securities in Open
Market.  The Company may, to
the extent permitted by applicable law, at any time, repurchase Securities in
the open market, by tender at any price or by negotiated transactions.  The Company may, to the extent permitted by
applicable law, surrender any Security purchased by the Company pursuant to
this Article 4 to the Trustee for cancellation or reissue or resell any
Security.  Any securities surrendered to
the Trustee for cancellation may not be reissued or resold by the Company and
will be canceled promptly in accordance with Section 2.11.


 


ARTICLE
5


CONVERSION


 


Section 5.01.  Conversion Privilege and Conversion Rate.


 


(a)                        Subject to
and upon compliance with the provisions of this Article 5, at the option
of the Holder thereof, any Security or portion thereof that is an integral
multiple of $1,000 principal amount may be converted into fully paid and
non-assessable shares (calculated as to each conversion to the nearest
1/10,000th of a share) of Common Stock prior to the close of business on the Business
Day immediately preceding the Final Maturity Date or such earlier date set
forth in this Article 5, unless redeemed or purchased by the Company at
the Holder’s option, at the Conversion Rate in effect at such time, determined
as hereinafter provided.  When a Holder
receives Common Stock upon conversion, such Holder will also receive the
associated preferred stock purchase right under the Company’s rights agreement
adopted in 2004 (as amended in 2007) related to its series A junior
participating preferred stock, unless, prior to conversion, the rights have
expired, terminated or been exchanged.


 


(b)                       Provisions
of this Indenture that apply to conversion of all of a Security also apply to
conversion of a portion of a Security.


 


(c)                        A Holder
of Securities is not entitled to any rights of a holder of Common Stock until
such Holder has converted its Securities into Common Stock, and only to the
extent such Securities are deemed to have been converted into Common Stock
pursuant to this Article 5.


 


28

















 


(d)                       The
Conversion Rate shall be adjusted in certain instances as provided in Section 5.01(e) and
Section 5.06.


 


(e)                        If there
shall have occurred an event specified in clauses (i) or (ii) of the
definition of Change of Control, the Company shall pay a “Make Whole Premium”
to the Holders of the Securities whose conversion notice is received by the
conversion agent on or subsequent to the date 10 Trading Days before the date
the Company announces as the anticipated Fundamental Change Effective Date but
before the close of business on the Business Day immediately preceding the
Fundamental Change Repurchase Date or 10 Trading Days after the actual
effective date of the Fundamental Change, if later, by increasing the Conversion
Rate for such Securities.  The number of
additional shares of Common Stock per $1,000 principal amount of Securities
constituting the Make Whole Premium shall be determined by the Company by
reference to the table below, based on the Fundamental Change Effective Date
and the Stock Price of such Fundamental Change; provided
that if the Stock Price or Fundamental Change Effective Date are not set forth
on the table: (i) if the actual Stock Price on the Fundamental Change
Effective Date is between two Stock Prices on the table or the actual
Fundamental Change Effective Date is between two Fundamental Change Effective
Dates on the table, the Make Whole Premium will be determined by a
straight-line interpolation between the Make Whole Premiums set forth for the
two Stock Prices and the two Fundamental Change Effective Dates on the table
based on a 365-day year, as applicable, (ii) if the Stock Price on the
Fundamental Change Effective Date exceeds $         per share, subject to adjustment as
set forth herein, no Make Whole Premium will be paid, and (iii) if the
Stock Price on the Fundamental Change Effective Date is less than $        per share, subject to adjustment as set
forth herein, no Make Whole Premium will be paid.  If Holders of the Common Stock receive only
cash in the Fundamental Change, the Stock Price shall be the cash amount paid
per share of the Common Stock in connection with the Fundamental Change.  Otherwise, the Stock Price shall be equal to
the average Closing Prices of the Common Stock for each of the 10 Trading Days
immediately preceding, but not including, the applicable Fundamental Change
Effective Date.


 


Make Whole Premium upon Certain Fundamental Changes


(Number of Additional Shares)


 


	
  Effective Date

  	
   

  
	
  Stock

  Price

  	
   

  	
  January   ,

  2008

  	
   

  	
  January 15,

  2009

  	
   

  	
  January 15,

  2010

  	
   

  	
  January 15,

  2011

  	
   

  	
  January 15,

  2012

  	
   

  	
  January 15,

  2013

  	
   

  	
  January 15,

  2014

  	
   

  	
  January 15,

  2015

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


The Stock Prices set forth in the first
column of the table above will be adjusted as of any date on which the
Conversion Rate of the Securities is adjusted. 
The adjusted Stock Prices will equal the Stock Prices applicable
immediately prior to such adjustment multiplied by a fraction, the numerator of
which is the Conversion Rate immediately prior to the adjustment giving rise to
the Stock Price adjustment and the denominator of which is the Conversion Rate
as so adjusted.  The number of additional
shares set forth in the table above will be adjusted in the same manner 


 


29

















 


as the Conversion Rate as set
forth in Section 5.06 hereof, other than as a result of an adjustment of
the Conversion Rate by adding the Make Whole Premium as described above.


 


Notwithstanding the foregoing paragraph, in
no event will the total number of shares of Common Stock issuable upon
conversion of a Security exceed             
per $1,000 principal amount, subject to adjustment in the same manner as
the Conversion Rate as set forth in clauses (i) through (vii) of Section 5.06(a) hereof.


 


The additional shares issuable pursuant to
this Section 5.01(e) shall be delivered upon the later of (i) the
settlement date for the conversion and (ii) promptly following the
Fundamental Change Effective Date.


 


(f)                          By
delivering the number of shares of Common Stock issuable on conversion to the
Trustee, or to the Conversion Agent, if the Conversion Agent is other than the
Trustee, the Company will be deemed to have satisfied its obligation to pay the
principal amount of the Securities so converted and its obligation to pay
accrued and unpaid interest attributable to the period from the most recent
Interest Payment Date through the Conversion Date (which amount will be deemed
paid in full rather than cancelled, extinguished or forfeited).


 


(g)                       The Trustee
may conclusively rely on the Company’s calculations of the Make Whole Premium.


 


Section 5.02.  Conversion Procedure.


 


(a)                        To convert
a Security, a Holder must (i) complete and manually sign the conversion
notice on the back of the Security and deliver such notice to a Conversion
Agent, (ii) surrender the Security to a Conversion Agent, (iii) furnish
appropriate endorsements and transfer documents if required by a Registrar or a
Conversion Agent, and (iv) pay all transfer or similar taxes, if required
pursuant to Section 5.04.  The date
on which the Holder satisfies all of those requirements is the “Conversion
Date.” Upon the conversion of a Security, the Company will deliver the shares
of Common Stock (and cash in lieu of fractional shares), to the Trustee (or to
the Conversion Agent, if the Conversion Agent is other than the Trustee), as
applicable, no later than three (3) Business Days after the Conversion
Date.  Anything herein to the contrary
notwithstanding, in the case of Global Securities, conversion notices may be
delivered and such Securities may be surrendered for conversion in accordance
with the Applicable Procedures as in effect from time to time.


 


(b)                       The person
in whose name the shares of Common Stock are issuable upon conversion shall be
deemed to be a holder of record of such Common Stock on the Conversion Date; provided, however, that no surrender of a Security on any
Conversion Date when the stock transfer books of the Company shall be closed
shall be effective to constitute the person or persons entitled to receive the
shares of Common Stock upon conversion as the record holder or holders of such
shares of Common Stock on such date, but such surrender shall be effective to
constitute the person or persons entitled to receive such shares of Common
Stock as the record holder or holders thereof for all purposes at the close of
business on the next succeeding day on 


 


30

















 


which such
stock transfer books are open; provided further that such conversion shall be
at the Conversion Rate in effect on the Conversion Date as if the stock
transfer books of the Company had not been closed.  Upon conversion of a Security, such person
shall no longer be a Holder of such Security. 
Except as set forth in this Indenture, no payment or adjustment will be
made for dividends or distributions declared or made on shares of Common Stock
issued upon conversion of a Security prior to the issuance of such shares.


 


(c)                        If a
holder surrenders a Security for conversion during the period from the close of
business on any Regular Record Date next preceding any Interest Payment Date to
the opening of business on such Interest Payment Date, then, despite the
conversion, the Company shall, on the Interest Payment Date, pay the semiannual
interest payable on such Security to the Person who was the Holder at the close
of business on the Regular Record Date. 
Such Security, upon surrender to the Company for conversion, must be
accompanied by funds equal to the amount of interest payable on the Security so
converted, provided that no such payment need be
made (i) in connection with any conversion following the Regular Record
Date immediately preceding the final Interest Payment Date, (ii) if the
Company had specified a Fundamental Change Purchase Date that is after a
Regular Record Date and on or prior to the Business Day following the
corresponding Interest Payment Date, (iii) in connection with any
conversion of Securities that have been called by the Company for redemption
and in respect of which the Company had specified a Redemption Date that is
after a Regular Record Date but on or prior to the corresponding Interest
Payment Date, or (iv) to the extent of any overdue interest, if any
overdue interest exists at the time of conversion with respect to such
Security.


 


(d)                       Subject to Section 5.02(c),
nothing in this Section shall affect the right of a Holder in whose name
any Security is registered at the close of business on a Regular Record Date to
receive the interest payable on such Security on the related Interest Payment
Date in accordance with the terms of this Indenture and the Securities.  If a Holder converts more than one Security
at the same time, the number of shares of Common Stock issuable upon the
conversion, if any, (and the amount of any cash in lieu of fractional shares
pursuant to Section 5.03) shall be based on the aggregate principal amount
of all Securities so converted.


 


(e)                        In the
case of any Security which is converted in part only, upon such conversion the
Company shall execute and the Trustee shall authenticate and deliver to the
Holder thereof, without service charge, a new Security or Securities of
authorized denominations in an aggregate principal amount equal to, and in exchange
for, the unconverted portion of the principal amount of such Security.  A Security may be converted in part, but only
if the principal amount of such part is an integral multiple of $1,000 and the
principal amount of such Security to remain outstanding after such conversion
is equal to $1,000 or any integral multiple of $1,000 in excess thereof.


 


Section 5.03.  Fractional Shares.  The Company will not issue
fractional shares of Common Stock upon conversion of Securities.  If more than one Security shall be
surrendered for conversion at one time by the same Holder, the number of full
shares that shall be issuable upon conversion shall be computed on the basis of
the aggregate principal amount of the Securities (or specified portions thereof
to the extent permitted hereby) so surrendered. 
In lieu of 


 


31

















 


any fractional share, the
Company will pay an amount in cash for the current market value of the
fractional share.  The current market
value of a fractional share shall be determined (calculated to the nearest
1/100th of a share) by multiplying the average of the Closing Price of the
Common Stock on the Trading Day immediately preceding the Conversion Date by
such fractional share and rounding the product to the nearest whole cent.


 


Section 5.04.  Taxes on Conversion.  If a Holder converts a Security,
the Holder shall pay any transfer, stamp or similar taxes or duties related to
the issue or delivery of shares of Common Stock upon such conversion.  The Holder shall also pay any such tax with
respect to cash received in lieu of fractional shares.  In addition, the Holder shall pay any such
tax which is due because the Holder requests the shares to be issued in a name
other than the Holder’s name.  The
Conversion Agent may refuse to deliver the certificate representing the Common
Stock being issued in a name other than the Holder’s name until the Conversion
Agent receives a sum sufficient to pay any tax which will be due because the
shares are to be issued in a name other than the Holder’s name.  Nothing herein shall preclude any tax
withholding required by law or regulation.


 


Section 5.05.  Company to Provide Stock.


 


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


 


(b)                       All shares
of Common Stock delivered upon conversion of the Securities shall be newly
issued shares, shall be duly authorized, validly issued, fully paid and
nonassessable and shall be free from preemptive or similar rights and free of
any lien or adverse claim as the result of any action by the Company.


 


(c)                        The
Company will endeavor promptly to comply with all federal and state securities
laws regulating the offer and delivery of shares of Common Stock upon
conversion of Securities.


 


Section 5.06.  Adjustment of Conversion Rate.


 


(a)                        The
Conversion Rate shall be adjusted from time to time by the Company as follows:


 


(i)                                     If
the Company shall pay a dividend or make a distribution on outstanding Common
Stock in shares of Common Stock, the Conversion Rate in effect immediately
prior to the record date for the determination of shareholders entitled to
receive such dividend or other distribution shall be increased so that the same
shall equal the rate determined by the Company by multiplying the Conversion
Rate in effect immediately prior to such record date by a fraction of which the
numerator shall be the sum of the number of shares of Common Stock outstanding
at the close of business on such record 


 


32

















 


date plus the total number of shares of
Common Stock constituting such dividend or other distribution and of which the
denominator shall be the number of shares of Common Stock outstanding at the
close of business on such record date. 
Such adjustment shall be made successively whenever any such dividend or
distribution is made and shall become effective immediately after such record
date.  For the purpose of this clause
(i), the number of shares of Common Stock at any time outstanding shall not
include shares held in the treasury of the Company.  The Company will not pay any dividend or make
any distribution on Common Stock held in the treasury of the Company.  If any dividend or distribution of the type
described in this clause is declared but not so paid or made, the Conversion
Rate shall again be adjusted to the Conversion Rate that would then be in
effect if such dividend or distribution had not been declared.


 


(ii)                                  If
the Company shall subdivide its outstanding Common Stock into a greater number
of shares, or combine its outstanding Common Stock into a smaller number of
shares, the Conversion Rate in effect immediately prior to the day upon which
such subdivision or combination becomes effective shall be, in the case of a
subdivision of Common Stock, proportionately increased and, in the case of a
combination of Common Stock, proportionately reduced.  Such adjustment shall be made successively
whenever any such subdivision or combination of the Common Stock occurs and
shall become effective immediately after the date upon which such subdivision
or combination becomes effective.


 


(iii)                               If
the Company shall issue certain rights or warrants to all or substantially all
holders of its outstanding Common Stock entitling them (for a period expiring
within 45 days after such issuance) to subscribe for or purchase shares of
Common Stock (or securities convertible into Common Stock) at a price per share
(or having a conversion price per share) less than the Current Market Price per
share of Common Stock (as determined in accordance with clause (ix) of
this Section 5.06(a)) on the record date for the determination of
shareholders entitled to receive such rights or warrants, the Conversion Rate
in effect immediately prior thereto shall be adjusted so that the same shall
equal the rate determined 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 at the close of
business on such record date plus the number of additional shares of Common
Stock that such rights or warrants entitle holders thereof to subscribe for or
purchase (or into which such convertible securities are convertible) and of
which the denominator shall be the number of shares of Common Stock outstanding
at the close of business on such record date plus the number of shares which
the aggregate offering price of the total number of shares of Common Stock so
offered for subscription or purchase (or the aggregate conversion price of the
convertible securities so offered for subscription or purchase, which shall be
determined by multiplying the number of shares of Common Stock issuable upon
conversion of such convertible securities by the conversion price per share of
Common Stock pursuant to the terms of such convertible securities) would purchase
at the Current Market Price per share of Common Stock on such record date.  Such adjustment shall be made successively
whenever any such rights or warrants (or convertible securities) are issued, 


 


33

















 


and shall become effective immediately after
such record date.  To the extent that
shares of Common Stock (or securities convertible into Common Stock) are not
delivered after the expiration of such rights or warrants, the Conversion Rate
shall be readjusted to the Conversion Rate that would then be in effect had the
adjustments made upon the issuance of such rights or warrants been made on the
basis of delivery of only the number of shares of Common Stock (or securities
convertible into Common Stock) actually delivered.  If such rights or warrants are not so issued,
the Conversion Rate shall again be adjusted to be the Conversion Rate that
would then be in effect if the record date for the determination of
shareholders entitled to receive such rights or warrants had not been
fixed.  In determining whether any rights
or warrants entitle the shareholders to subscribe for or purchase shares of
Common Stock at a price less than the Current Market Price per share of Common
Stock and in determining the aggregate offering price of the total number of
shares of Common Stock so offered, there shall be taken into account any
consideration received by the Company for such rights or warrants and any
amount payable on exercise or conversion thereof, the value of such consideration,
if other than cash, to be determined by the Board of Directors.


 


(iv)                              If
the Company shall make a dividend or other distribution to all or substantially
all holders of its Common Stock of Capital Stock, other than Common Stock, or
evidences of indebtedness or other assets of the Company, including securities
(excluding (x) any issuance of rights or warrants for which an adjustment
was made pursuant to Section 5.06(a)(iii), (y) dividends or
distributions in connection with a reclassification, consolidation, merger,
combination, sale or conveyance resulting in a change in the conversion
consideration pursuant to Section 5.10, or pursuant to any Rights Plan or (z) any
dividend or distribution paid exclusively in cash for which an adjustment was
made pursuant to Section 5.06(a)(vi)) (the “Distributed Securities”), then
in each such case (unless the Company distributes such Distributed Securities
for distribution to the Holders of Securities on such dividend or distribution
date as if each Holder had converted such Security into Common Stock
immediately prior to the record date with respect to such distribution) the
Conversion Rate in effect immediately prior to the record date fixed for the
determination of shareholders entitled to receive such dividend or distribution
shall be adjusted so that the same shall equal the rate determined by
multiplying the Conversion Rate in effect immediately prior to such record date
by a fraction of which the numerator shall be the Current Market Price per
share of the Common Stock on such record date and of which the denominator
shall be Current Market Price per share on such record date less the fair
market value (as determined in good faith by the Board of Directors, whose
determination shall be conclusive evidence of such fair market value and which
shall be evidenced by an Officers’ Certificate delivered to the Trustee) on
such record date of the portion of the Distributed Securities so distributed
applicable to one share of Common Stock (determined on the basis of the number
of shares of Common Stock outstanding at the close of business on such record
date).  Such adjustment shall be made
successively whenever any such distribution is made and shall become effective
immediately after the record date for the determination of shareholders
entitled to receive such distribution. 
In the event that such dividend or 


 


34

















 


distribution is not so paid or made, the
Conversion Rate shall again be adjusted to be the Conversion Rate that would
then be in effect if such dividend or distribution had not been declared.


 


If the fair market value (as so
determined) of the portion of the Distributed Securities so distributed
applicable to one share of Common Stock is equal to or greater than the Current
Market Price per share of the Common Stock on such record date, in lieu of the
foregoing adjustment, adequate provision shall be made so that each holder of a
Security shall have the right to receive upon conversion the amount of
Distributed Securities so distributed that such Holder would have received had
such Holder converted each Security on such record date.  If the Board of Directors determines the fair
market value of any distribution for purposes of this Section 5.06(a)(iv) by
reference to the actual or when issued trading market for any securities, it
must in doing so consider the prices in such market over the same period used
in computing the Current Market Price of the Common Stock.


 


Notwithstanding the foregoing,
if the securities distributed by the Company to all holders of its Common Stock
consist of Capital Stock of, or similar equity interests in, a Subsidiary or
other business unit of the Company (the “Spinoff Securities”), the Conversion
Rate shall be adjusted, unless the Company makes an equivalent distribution to
the Holders of the Securities, so that the same shall be equal to the rate
determined by multiplying the Conversion Rate in effect on the record date
fixed for the determination of shareholders entitled to receive such
distribution by a fraction, the numerator of which shall be the sum of (A) the
average Closing Price of one share of Common Stock over the ten consecutive
Trading Day period (the “Spinoff Valuation Period”) commencing on and including
the Trading Day on which ex-dividend trading commences for such distribution on
the Nasdaq Global Market or such other U.S. 
national or regional exchange or market on which the Common Stock is
then listed or quoted and (B) the average of the Closing Prices over the
Spinoff Valuation Period of the Spinoff Securities multiplied by the number of
Spinoff Securities distributed in respect of one share of Common Stock and the
denominator of which shall be the average Closing Price of one share of Common
Stock over the Spinoff Valuation Period, such adjustment to become effective
immediately prior to the opening of business on the tenth Trading Day after the
date on which ex-dividend trading commences; provided,
however, that the Company may in lieu of the foregoing adjustment
elect to make adequate provision so that each Holder of Securities shall have
the right to receive upon conversion thereof the amount of such Spinoff
Securities that such Holder of Securities would have received if such
Securities had been converted on the record date with respect to such
distribution.


 


(v)                                 With
respect to any rights or warrants (the “Rights”) that may be issued or
distributed pursuant to any rights plan of the Company currently in effect or
that the Company implements after the date of this Indenture (a “Rights Plan”),
or if the Company’s current Rights Plan is still in effect, in lieu of any
adjustment required by any other provision of this Section 5.06 upon
conversion of the Securities into Common 


 


35

















 


Stock, to the extent that such Rights Plan is
in effect upon such conversion, the Holders of Securities will receive, with
respect to the shares of Common Stock issued upon conversion, the Rights
described therein (whether or not the Rights have separated from the Common
Stock at the time of conversion), subject to the limitations set forth in and
in accordance with any such Rights Plan; provided that
in the case of the Company’s current Rights Plan or a future Rights Plan to the
extent applicable, if, at the time of conversion, the Rights have separated
from the shares of Common Stock in accordance with the provisions of the Rights
Plan so that Holders would not be entitled to receive any rights in respect of
the shares of Common Stock issuable upon conversion of the Securities as a
result of the timing of the Conversion Date, the Conversion Rate will be
adjusted as if the Company distributed to all holders of Common Stock
Distributed Securities constituting such rights as provided in the first paragraph
of clause (iv) of this Section 5.06(a), subject to appropriate
readjustment in the event of the expiration, termination, repurchase or
redemption of the Rights.  Any
distribution of rights or warrants pursuant to a Rights Plan complying with the
requirements set forth in the immediately preceding sentence of this paragraph
shall not constitute a distribution of rights or warrants pursuant to this Section 5.06(a).  Other than as specified in this clause (v) of
this Section 5.06(a), there will not be any adjustment to the Conversion
Rate as the result of the issuance of any Rights, the distribution of separate
certificates representing such Rights, the exercise or redemption of such
Rights in accordance with any Rights Plan or the termination or invalidation of
any Rights.


 


(vi)                              If
the Company shall, by dividend or otherwise, at any time distribute (a
“Triggering Distribution”) to all holders of its Common Stock a payment
consisting exclusively of cash (excluding any dividend or distribution in
connection with the liquidation, dissolution or winding up of the Company,
whether voluntary or involuntary) the Conversion Rate shall be increased so
that the same shall equal the rate determined by multiplying such Conversion
Rate in effect at the opening of business on the date on which ex-dividend
trading commences for such Triggering Distribution (a “Determination Date”) by
a fraction of which the numerator shall be the average of the Last Reported
Sale Price for the ten Trading Days prior to the date on which ex-dividend
trading commences for such dividend or distribution and the denominator of
which shall be the difference between (A) such average price of the Common
Stock and (B) the amount in cash per share of such dividend or
distribution, such increase to become effective immediately prior to the
opening of business on the day following the Determination Date.  If the amount of cash dividend or
distribution applicable to one share of Common Stock is equal to or greater than
the Last Reported Sale Price per share of the Common Stock on the Determination
Date, in lieu of the foregoing adjustment, adequate provision shall be made so
that each Holder of a Security shall have the right to receive upon conversion
the amount of cash so distributed that such Holder would have received had such
Holder converted each Security on such Determination Date.  In the event that such dividend or
distribution is not so paid or made, the Conversion Rate shall again be
adjusted to be the Conversion Rate that would then be in effect if such divided
or distribution had not been declared.


 


36

















 


(vii)                           If any
tender offer made by the Company or any of its Subsidiaries for all or any
portion of Common Stock shall expire, then, if the tender offer shall require
the payment to shareholders of consideration per share of Common Stock having a
fair market value (determined as provided below) that exceeds Closing Price per
share of Common Stock on the Trading Day next succeeding the last date (the “Expiration
Date”) tenders could have been made pursuant to such tender offer (as it may be
amended) (the last time at which such tenders could have been made on the
Expiration Date is hereinafter sometimes called the “Expiration Time”), the
Conversion Rate shall be increased so that the same shall equal the rate
determined by multiplying the Conversion Rate in effect immediately prior to
the close of business on the Expiration Date by a fraction of which the
numerator shall be the sum of (A) the fair market value of the aggregate
consideration (the fair market value as determined in good faith by the Board
of Directors, whose determination shall be conclusive evidence of such fair
market value and which shall be evidenced by an Officer’s Certificate delivered
to the Trustee) payable to shareholders based on the acceptance (up to any
maximum specified in the terms of the tender offer) of all shares validly
tendered and not withdrawn as of the Expiration Time (the shares deemed so
accepted, up to any such maximum, being referred to as the “Purchased Shares”)
and (B) the product of the number of shares of Common Stock outstanding
(less any Purchased Shares and excluding any shares held in the treasury of the
Company) at the Expiration Time and the Closing Price per share of Common Stock
on the Trading Day next succeeding the Expiration Date and the denominator of
which shall be the product of the number of shares of Common Stock outstanding
(including Purchased Shares but excluding any shares held in the treasury of
the Company) at the Expiration Time multiplied by the Closing Price per share
of the Common Stock on the Trading Day next succeeding the Expiration Date,
such increase to become effective immediately prior to the opening of business
on the day following the Expiration Date. 
In the event that the Company is obligated to purchase shares pursuant
to any such tender offer, but the Company is permanently prevented by
applicable law from effecting any or all such purchases or any or all such
purchases are rescinded, the Conversion Rate shall again be adjusted to be the
Conversion Rate which would have been in effect based upon the number of shares
actually purchased, if any.  If the
application of this clause (vii) of Section 5.06(a) to any
tender offer would result in a decrease in the Conversion Rate, no adjustment
shall be made for such tender offer under this clause (vii).


 


(viii)                        For
purposes of this Section 5.06, the term “tender offer” shall mean and
include both tender offers and exchange offers, all references to “purchases”
of shares in tender offers (and all similar references) shall mean and include
both the purchase of shares in tender offers and the acquisition of shares
pursuant to exchange offers, and all references to “tendered shares” (and all
similar references) shall mean and include shares tendered in both tender
offers and exchange offers.


 


(ix)                                For
purposes of any computation under this Section 5.06, “Current Market
Price” shall mean the average of the daily Closing Prices per share of Common
Stock for each of the ten consecutive Trading Days immediately prior to the
date in question; provided, however, that if:


 


37














 


(A)       the “ex” date (as
hereinafter defined) for any event (other than the issuance or distribution
requiring such computation) that requires an adjustment to the Conversion Rate
pursuant to Section 5.06(a) (i), (ii), (iii), (iv), (v), (vi) or
(vii) occurs during such ten consecutive Trading Days, the Closing Price
for each Trading Day prior to the “ex” date for such other event shall be
adjusted by dividing such Closing Price by the same fraction by which the
Conversion Rate is so required to be adjusted as a result of such other event;


 


(B)        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 Section 5.06(a) (i),
(ii), (iii), (iv), (v), (vi) or (vii) occurs on or after the “ex”
date for the issuance or distribution requiring such computation and prior to
the day in question, the Closing Price for each Trading Day on and after the
“ex” date for such other event shall be adjusted by dividing such Closing 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; and


 


(C)        the “ex” date for the
issuance or distribution requiring such computation is prior to the day in
question, after taking into account any adjustment required pursuant to the
immediately preceding clause (A) or (B) of this Section 5.06(a)(ix),
the Closing Price for each Trading Day on or after such “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 purposes of Section 5.06(a)(iv) or
(vii), whose determination shall be conclusive and set forth in a Board
Resolution) of the evidences of indebtedness, shares of capital stock or assets
being distributed applicable to one share of Common Stock as of the close of
business on the day before such “ex” date.


 


For purposes
of any computation under Section 5.06(a), if the “ex” date for any event
(other than the tender offer that is the subject of the adjustment pursuant to Section 5.06(a)(vii))
that requires an adjustment to the Conversion Rate pursuant to Section 5.06(a)(i),
(ii), (iii), (iv), (v) or (vi) occurs on the date of the Expiration
Time for the tender or exchange offer requiring such computation or on the
Trading Day next following the Expiration Time, the Closing Price for each
Trading Day on and after the “ex” date for such other event shall be adjusted
by dividing such Closing 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.  For purposes of this Section 5.06(a)(ix) the
term “ex” date, when used:


 


(A)       with respect to any issuance or distribution, means the first
date on which the Common Stock trades regular way on the relevant exchange or
in the relevant market from which the Closing Price was obtained without the
right to receive such issuance or distribution;


 


38

















 


(B)        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


 


(C)        with respect to any tender or exchange 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 offer.


 


Notwithstanding
the foregoing, whenever successive adjustments to the Conversion Rate are
called for pursuant to this Section 5.06, such adjustments shall be made
to the Current Market Price as may be necessary or appropriate to effectuate
the intent of this Section 5.06 and to avoid unjust or inequitable results
as determined in good faith by the Board of Directors and evidenced by an
Officers’ Certificate delivered to the Trustee.


 


(b)        In any case in which this Section 5.06
shall require that an adjustment be made following a record date, a
Determination Date or Expiration Date, as the case may be, established for the
purposes specified in this Section 5.06, the Company may elect to defer
(but only until three Business Days following the filing by the Company with
the Trustee of the certificate described in Section 5.08) issuing to the
Holder of any Security converted after such record date, Determination Date or
Expiration Date the shares of Common Stock and other Capital Stock of the
Company issuable upon such conversion over and above the shares of Common Stock
and other Capital Stock of the Company (or other cash, property or securities,
as applicable) issuable upon such conversion only on the basis of the
Conversion Rate prior to adjustment; and, in lieu of any cash, property or
securities the issuance of which is so deferred, the Company shall issue or
cause its transfer agents to issue due bills or other appropriate evidence
prepared by the Company of the right to receive such cash, property or
securities.  If any distribution in
respect of which an adjustment to the Conversion Rate is required to be made as
of the record date, Determination Date or Expiration Date therefore is not
thereafter made or paid by the Company for any reason, the Conversion Rate
shall be readjusted to the Conversion Rate which would then be in effect if
such record date had not been fixed or such record date, Determination Date or
Expiration Date had not occurred.


 


(c)        For purposes of this Section 5.06,
“record date” shall mean, with respect to any dividend, distribution or other
transaction or event in which the holders of Common Stock have the right to
receive any cash, securities or other property or in which the Common Stock (or
other applicable security) is exchanged or converted into any combination of
cash, securities or other property, the date fixed for determination of
shareholders entitled to receive such cash, security or other property (whether
or not such date is fixed by the Board of Directors or by statute, contract or
otherwise).


 


(d)        If one or more events occur requiring an
adjustment be made to the Conversion Rate for a particular period, adjustments
to the Conversion Rate shall be determined by the Company’s Board of Directors
to reflect the combined impact of such Conversion Rate adjustment events, as
set out in this Section 5.06, during such period.


 


39

















 


(e)        Notwithstanding the provisions set forth
in Section 5.06(a), in no event shall the total number of shares of Common
Stock issuable upon conversion of a Security exceed       shares per $1,000 principal amount of
Securities, subject to adjustments in the same manner as the Conversion Rate as
set forth in clauses (i) through (vii) of Section 5.06(a).


 


Section 5.07.  No Adjustment.


 


(a)        No adjustment in the Conversion Rate
shall be required if Holders may, by virtue of their ownership of the
Securities, participate in the transactions set forth in Section 5.06
above (to the same extent as if the Securities had been converted into Common Stock
immediately prior to such transactions) without converting the Securities held
by such Holders.


 


(b)        No adjustment in the Conversion Rate
shall be required unless such adjustment would require an increase or decrease
of at least 1% in the Conversion Rate as last adjusted; provided,
however, that any adjustments which would be required to be made but
for this Section 5.07(b) shall be carried forward and taken into
account in any subsequent adjustment. 
The Company shall adjust for any carry forward amount upon conversion
regardless of the 1% threshold.  All
calculations under this Article 5 shall be made to the nearest cent or to
the nearest one-ten thousandth of a share, as the case may be, with one half
cent and 0.00005 of a share, respectively, being rounded upward.


 


(c)        No adjustment in the Conversion Rate
shall be required for issuances of Common Stock pursuant to a Company plan for
reinvestment of dividends, the issuance of Common Stock or options to purchase
shares of Common Stock pursuant to any present or future employee, director or
consultant benefit plan or program of or assumed by the Company, upon the
issuance of Common Stock pursuant to any option, warrant or right, or exercise
of any exchangeable or convertible security outstanding as of the Issue Date,
repurchases by the Company of Common Stock not expressly discussed in this Article 5
or interest or for a change to a par value of the Common Stock.


 


(d)        To the extent that the Securities become
convertible into the right to receive cash, no adjustment need be made
thereafter as to the cash.


 


Section 5.08.  Notice of Adjustment.  Whenever the Conversion Rate or
conversion privilege is required to be adjusted pursuant to this Indenture, the
Company shall promptly mail to Holders 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. 
Failure to mail such notice or any defect therein shall not affect the
validity of any such adjustment.  Unless
and until the Trustee shall receive an Officers’ Certificate setting forth an
adjustment of the Conversion Rate, the Trustee may assume without inquiry that
the Conversion Rate has not been adjusted and that the last Conversion Rate of
which it has knowledge remains in effect.


 


Section 5.09.  Notice of Certain
Transactions.  In the event
that there is a dissolution or liquidation of the Company, the Company shall
mail to Holders and file with the Trustee a notice stating the proposed
effective date.  The Company shall mail
such notice at least 10 days before 


 


40

















 


such proposed
effective date.  Failure to mail such
notice or any defect therein shall not affect the validity of any transaction
referred to in this Section 5.09.


 


Section 5.10.  Effect of Recapitalization,
Reclassification, Consolidation, Merger or Sale.  If any of following events occur
(each, a “Business Combination”):


 


(i)        any recapitalization, reclassification or change of the
Common Stock, other than changes resulting from a subdivision or a combination,


 


(ii)       a consolidation, merger or combination
involving the Company,


 


(iii)      a sale, conveyance or lease to another
corporation of all or substantially all of the property and assets of the Company,
other than to one or more of the Company’s subsidiaries, or


 


(iv)     any statutory share exchange,


 


in each case as a result of
which holders of Common Stock are entitled to receive stock, other securities,
other property or assets (including cash or any combination thereof) with
respect to or in exchange for Common Stock, the Company or the successor or
purchasing corporation, as the case may be, shall execute with the Trustee a
supplemental indenture (which shall comply with the TIA as in force at the date
of execution of such supplemental indenture if such supplemental indenture is
then required to so comply) providing that the Holders of the Securities then
outstanding will be entitled thereafter to convert such Securities into the
kind and amount of shares of stock, other securities or other property or
assets (including cash or any combination thereof) which they would have owned
or been entitled to receive upon such Business Combination had such Securities
been converted into Common Stock immediately prior to such Business
Combination, except that such Holders will not receive the Make Whole Premium
if such Holder does not convert its Securities “in connection with” the
relevant Fundamental Change.  A conversion
of the Securities by a Holder will be deemed for these purposes to be “in
connection with” a Fundamental Change if the notice of such conversion is
provided in compliance with Section 5.02(a) to the Conversion Agent
on or subsequent to the date 10 Trading Days prior to the date announced by the
Company as the anticipated Fundamental Change Effective Date but before the
close of business on the Business Day immediately preceding the related
Fundamental Change Repurchase Date.  In
the event holders of Common Stock have the opportunity to elect the form of
consideration to be received in such Business Combination, the Securities will
be convertible into the weighted average of the kind and amount of
consideration received by the holders of the Common Stock that affirmatively
make such an election.  The Company may
not become a party to any such transaction unless its terms are consistent with
this Section 5.10.  Such
supplemental indenture shall provide for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Article 5.  If, in the case of any such Business
Combination, the stock or other securities and assets receivable thereupon by a
holder of shares of Common Stock includes shares of stock or other securities
and assets of a corporation other than the successor or purchasing corporation,
as the case may be, in such Business Combination, then such supplemental
indenture shall also be 


 


41

















 


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, including to the
extent practicable the provisions providing for the Repurchase Rights set forth
in Article 4 hereof. 
Notwithstanding anything contained in this Section, and for the
avoidance of doubt, this Section shall not affect the right of a Holder to
convert its Securities into shares of Common Stock prior to the effective date
of the Business Combination.


 


Section 5.11.  Trustee’s Disclaimer.


 


(a)        The Trustee shall have no duty to
determine when an adjustment under this Article 5 should be made, how it
should be made or what such adjustment should be, but may accept as conclusive
evidence of that fact or the correctness of any such adjustment, and shall be
protected in relying upon, an Officers Certificate and/or an Opinion of
Counsel, including the Officers’ Certificate with respect thereto which the
Company is obligated to file with the Trustee pursuant to Section 5.08.  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 Company’s failure
to comply with any provisions of this Article 5.


 


(b)        The Trustee shall not be under any
responsibility to determine the correctness of any provisions contained in any
supplemental indenture executed pursuant to Section 5.10, but may accept
as conclusive evidence of the correctness thereof, and shall be fully protected
in relying upon, the officers, Certificate and Opinion of Counsel, with respect
thereto which the Company is obligated to file with the Trustee pursuant to Section 13.04.


 


Section 5.12.  Voluntary Increase.  The Company from time to time may
increase the Conversion Rate, to the extent permitted by law, by any amount for
any period of time if the period is at least 20 days, and the Company provides
15 days prior written notice to any increase in the Conversion Rate to the
Trustee and Holders.  The Company may
also make such an increase to the Conversion Rate as the Board of Directors
deems advisable to avoid or diminish U.S. 
federal income tax to holders of shares of Common Stock in connection
with a dividend or distribution of stock (or rights to acquire stock) or from
any event treated as such for U.S. 
federal income tax purposes.


 


Notwithstanding
the foregoing paragraph, in no event will the total number of shares of Common
Stock issuable upon conversion of a Security exceed            shares per $1,000 principal amount,
subject to adjustment in the same manner as the Conversion Rate as set forth in
clauses (i) through (vii) of Section 5.06(a) hereof.


 


ARTICLE 6

SUBORDINATION


 


Section 6.01.  Agreement of Subordination.  The Company covenants and agrees,
and each Holder of Securities issued hereunder by its acceptance thereof
likewise covenants and 


 


42

















 


agrees, that
all Securities shall be issued subject to the provisions of this Article 6;
and each Person holding any Security, whether upon original issue or upon
transfer, assignment or exchange thereof, accepts and agrees to be bound by
such provisions.


 


The payment of
the principal of, premium, if any, and interest on, all Securities (including,
but not limited to, the Fundamental Change Repurchase Price with respect to the
Securities subject to purchase in accordance with Article 4 as provided in
this Indenture) issued hereunder shall, to the extent and in the manner
hereinafter set forth, be subordinated and subject in right of payment to the
prior payment in full in cash, or other payment satisfactory to the holders of
Senior Indebtedness, of all Senior Indebtedness, whether outstanding at the
date of this Indenture or thereafter incurred.


 


No provision
of this Article 6 shall prevent the occurrence of any default or Event of
Default hereunder.


 


Section 6.02.  Payments to Holders.  The Company shall not make any
payment with respect to the principal of, or premium, if any, or interest on
the Securities (including, but not limited to, the Fundamental Change
Repurchase Price with respect to the Securities subject to purchase in
accordance with Article 4 as provided in this Indenture), except payments
and distributions made by the Trustee as permitted by the first or second
paragraph of Section 6.05, and shall not purchase or otherwise acquire for
value any Securities if:


 


(a)        a default in the payment of principal,
premium, interest, rent or other obligations due on any Senior Indebtedness
occurs and is continuing (or, in the case of Senior Indebtedness for which
there is a period of grace, in the event of such a default that continues
beyond the period of grace, if any, specified in the instrument or lease
evidencing such Senior Indebtedness), unless and until such default shall have
been cured or waived or shall have ceased to exist and notice thereof has been
given to the Trustee; or


 


(b)        a default, other than a payment default,
on Designated Senior Indebtedness occurs and is continuing that then permits
holders of such Designated Senior Indebtedness to accelerate its maturity and
the Trustee receives a notice of the default (a “Payment Blockage Notice”) from
the Company or a holder of Designated Senior Indebtedness or a representative
of such holder.


 


The Company
may and shall resume payments on and distributions in respect of the Securities
upon:


 


(i)        in the case of a payment default of Senior Indebtedness, upon
the date on which such default is cured or waived or otherwise ceases to exist;
and


 


(ii)       in the case of a non-payment default on Designated Senior
Indebtedness referred to in clause (b) above, the earlier of (A) 179
days after the date on which a Payment Blockage Notice is received, and (B) the
date on which the non-payment default is cured or waived or otherwise ceases to
exist, unless this Article 6 otherwise prohibits the payment or
distribution at the time of such payment or distribution.


 


43

















 


Subject to the
provisions of Section 6.05, no subsequent Payment Blockage pursuant to
this Section 6.02 may be commenced unless (i) at least 365 days shall
have elapsed since the Company’s receipt of the immediately prior Payment
Blockage Notice and (ii) all scheduled payments of principal, premium or
interest on the Securities that have come due have been paid in full in
cash.  No nonpayment default that existed
or was continuing on the date of delivery of any Payment Blockage Notice to the
Trustee (unless such default was waived, cured or otherwise ceased to exist and
thereafter subsequently reoccurred) shall be, or be made, the basis for a
subsequent Payment Blockage Notice.


 


Upon any
payment by the Company, or distribution of assets of the Company of any kind or
character, whether in cash, property or securities, to creditors upon any
dissolution or winding-up or liquidation or reorganization of the Company
(whether voluntary or involuntary) or in bankruptcy, insolvency, receivership
or similar proceedings, all amounts due or to become due upon all Senior
Indebtedness shall first be paid in full in cash, or other payment satisfactory
to the holders of Senior Indebtedness (except payments made pursuant to Article 11
from monies deposited with the Trustee pursuant thereto prior to commencement
of proceedings for such dissolution, winding-up, liquidation or
reorganization); and upon any such dissolution or winding-up or liquidation or
reorganization of the Company or bankruptcy, insolvency, receivership or other
similar proceeding, any payment by the Company, or distribution of assets of
the Company of any kind or character, whether in cash, property or securities,
to which the Holders of the Securities or the Trustee would be entitled, except
for the provision of this Article 6, shall (except as aforesaid) be paid
by the Company or by any receiver, trustee in bankruptcy, liquidating trustee,
agent or other Person making such payment or distribution, or by the Holders of
the Securities or by the Trustee under this Indenture if received by them or
it, directly to the holders of Senior Indebtedness (pro rata to such holders on
the basis of the respective amounts of Senior Indebtedness held by such
holders, or as otherwise required by law or a court order) or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any Senior Indebtedness
may have been issued, as their respective interests may appear, to the extent
necessary to pay all Senior Indebtedness in full in cash, or other payment
satisfactory to the holders of Senior Indebtedness, after giving effect to any
concurrent payment or distribution to or for the holders of Senior
Indebtedness, before any payment or distribution is made to the Holders of the
Securities or to the Trustee.


 


In the event
of the acceleration of the Securities because of an Event of Default, no
payment or distribution shall be made to the Trustee or any Holder of
Securities in respect of the principal of, premium, if any, or interest on the
Securities (including, but not limited to, the Fundamental Change Repurchase
Price with respect to the Securities subject to purchase in accordance with Article 4
as provided in this Indenture), except payments and distributions made by the Trustee
as permitted by the first or second paragraph of Section 6.05, until all
Senior Indebtedness has been paid in full in cash or other payment satisfactory
to the holders of Senior Indebtedness or such acceleration is rescinded in
accordance with the terms of this Indenture. 
If payment of the Securities is accelerated because of an Event of
Default, the Company shall promptly notify holders of Senior Indebtedness of
such acceleration.


 


44

















 


In the event that,
notwithstanding the foregoing provisions, any payment or distribution of assets
of the Company of any kind or character, whether in cash, property or
securities (including, without limitation, by way of setoff or otherwise),
prohibited by the foregoing, shall be received by the Trustee or the Holders of
the Securities before all Senior Indebtedness is paid in full, in cash or other
payment satisfactory to the holders of Senior Indebtedness, or provision is
made for such payment thereof in accordance with its terms in cash or other
payment satisfactory to the holders of Senior Indebtedness, such payment or
distribution shall be held in trust for the benefit of and shall be paid over
or delivered to the holders of Senior Indebtedness or their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing any Senior Indebtedness may have been issued,
as their respective interests may appear, as calculated by the Company, for
application to the payment of all Senior Indebtedness remaining unpaid to the
extent necessary to pay all Senior Indebtedness in full, in cash or other
payment satisfactory to the holders of Senior Indebtedness, after giving effect
to any concurrent payment or distribution to or for the holders of such Senior
Indebtedness.


 


Nothing in
this Section 6.02 shall apply to claims of, or payments to, the Trustee
under or pursuant to Section 10.07. 
This Section 6.02 shall be subject to the further provisions of Section 6.05.


 


For purposes
of this Article 6, the words, “cash, property or securities” shall not be
deemed to include shares of stock of the Company as reorganized or readjusted,
or securities of the Company or any other corporation provided for by a plan of
reorganization or readjustment, the payment of which is subordinated at least
to the extent provided in this Article 6 with respect to the Securities to
the payment of all Senior Indebtedness which may at the time be outstanding; provided that (i) the Senior Indebtedness is assumed by
the new corporation, if any, resulting from any reorganization or readjustment,
and (ii) the rights of the holders of Senior Indebtedness (other than
leases which are not assumed by the Company or the new corporation, as the case
may be) are not, without the consent of such Holders, altered by such
reorganization or readjustment.  The
consolidation of the Company with, or the merger of the Company into, another
corporation or the liquidation or dissolution of the Company following the
conveyance or transfer of its property as an entirety, or substantially as an
entirety, to another corporation upon the terms and conditions provided for in Article 8
shall not be deemed a dissolution, winding-up, liquidation or reorganization
for the purposes of this Section 6.02 if such other corporation shall, as
a part of such consolidation, merger, conveyance or transfer, comply with the
conditions stated in Article 8.


 


Section 6.03.  Subrogation of
Securities.  Subject to the
payment in full, in cash or other payment satisfactory to the holders of Senior
Indebtedness, of all Senior Indebtedness, the rights of the Holders of the
Securities shall be subrogated to the extent of the payments or distributions
made to the holders of such Senior Indebtedness pursuant to the provisions of
this Article 6 (equally and ratably with the holders of all indebtedness
of the Company which by its express terms is subordinated to other indebtedness
of the Company to substantially the same extent as the Securities are subordinated
and is entitled to like rights of subrogation) to the rights of the holders of
Senior Indebtedness to receive payments or distributions of cash, property or 


 


45

















 


securities of
the Company applicable to the Senior Indebtedness until the principal, premium,
if any, and interest on the Securities shall be paid in full in cash or other
payment satisfactory to the holders of Senior Indebtedness.  For the purposes of such subrogation, no
payments or distributions to the holders of the Senior Indebtedness of any
cash, property or securities to which the Holders of the Securities or the
Trustee would be entitled except for the provisions of this Article 6, and
no payment pursuant to the provisions of this Article 6, to or for the
benefit of the holders of Senior Indebtedness by Holders of the Securities or
the Trustee, shall, as between the Company, its creditors other than holders of
Senior Indebtedness, and the Holders of the Securities, be deemed to be a payment
by the Company to or on account of the Senior Indebtedness.  No payments or distributions of cash,
property or securities to or for the benefit of the Holders of the Securities,
pursuant to the subrogation provisions of this Article 6, which would
otherwise have been paid to the holders of Senior Indebtedness shall be deemed
to be a payment by the Company to or for the account of the Securities.  It is understood that the provisions of this Article 6
are and are intended solely for the purposes of defining the relative rights of
the Holders of the Securities, on the one hand, and the holders of the Senior
Indebtedness, on the other hand.


 


Nothing
contained in this Article 6 or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as among the Company, its creditors
other than the holders of Senior Indebtedness, and the Holders of the
Securities, the obligation of the Company, which is absolute and unconditional,
to pay to the Holders of the Securities the principal of, and premium, if any,
and interest on the Securities as and when the same shall become due and
payable in accordance with their terms, or is intended to or shall affect the
relative rights of the Holders of the Securities and creditors of the Company
other than the holders of the Senior Indebtedness, nor shall anything herein or
therein prevent the Trustee or the Holder of any Security from exercising all
remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article 6 of the
holders of Senior Indebtedness in respect of cash, property or securities of
the Company received upon the exercise of any such remedy.


 


Upon any
payment or distribution of assets of the Company referred to in this Article 6,
the Trustee, subject to the provisions of Section 10.01, and the Holders
of the Securities shall be entitled to rely upon any order or decree made by
any court of competent jurisdiction in which such bankruptcy, dissolution,
winding-up, liquidation or reorganization proceedings are pending, or a
certificate of the receiver, trustee in bankruptcy, liquidating trustee, agent
or other person making such payment or distribution, delivered to the Trustee
or to the Holders of the Securities, for the purpose of ascertaining the
persons entitled to participate in such distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon and all other facts pertinent thereto or to this Article 6.


 


Section 6.04.  Authorization to Effect
Subordination.  Each Holder of
a Security by the Holder’s acceptance thereof authorizes and directs the
Trustee on the Holder’s behalf to take such action as may be necessary or
appropriate to effectuate the subordination as provided in this Article 6
and appoints the Trustee to act as the Holder’s attorney-in-fact for any and
all such purposes.  If the Trustee does
not file a proper proof of claim or proof of debt in the form required in any
proceeding referred to in Section 6.03 hereof at least 30 days before the 


 


46

















 


expiration of
the time to file such claim, the holders of any Senior Indebtedness or their
representatives are hereby authorized to file an appropriate claim for and on
behalf of the Holders of the Securities.


 


Section 6.05.  Notice to Trustee.  The Company shall give prompt
written notice in the form of an Officers’ Certificate to a Responsible Officer
of the Trustee and to any Paying Agent of (a) all Senior Indebtedness
incurred by the Company, including the names of representatives of such holders
(if actually known by the Company) of holders of Senior Indebtedness and (b) any
fact known to the Company which would prohibit the making of any payment of
monies to or by the Trustee or any Paying Agent in respect of the Securities
pursuant to the provisions of this Article 6.  Notwithstanding the provisions of this Article 6
or any other provision of this Indenture, the Trustee shall not be charged with
knowledge of the existence of any facts which would prohibit the making of any
payment of monies to or by the Trustee in respect of the Securities pursuant to
the provisions of this Article 6, unless and until a Responsible Officer
of the Trustee shall have received written notice thereof at the Corporate
Trust Office from the Company (in the form of an Officers’ Certificate) or a
holder or holders of Senior Indebtedness (or a representative of such holder or
holders) or from any trustee thereof; and before the receipt of any such
written notice, the Trustee, subject to the provisions of Section 10.01,
shall be entitled in all respects to assume that no such facts exist; provided that if on a date not fewer than one Business Day
prior to the date upon which by the terms hereof any such monies may become
payable for any purpose (including, without limitation, the payment of the
principal of, or premium, if any, or interest on any Security) the Trustee
shall not have received, with respect to such monies, the notice provided for in
this Section 6.05, then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive
such monies and to apply the same to the purpose for which they were received,
and shall not be affected by any notice to the contrary which may be received
by it on or after such prior date. 
Notwithstanding anything in this Article 6 to the contrary, nothing
shall prevent any payment by the Trustee to the Holders of monies deposited
with it pursuant to Article 11, and any such payment shall not be subject
to the provisions of Article 6.


 


The Trustee,
subject to the provisions of Section 10.01, shall be entitled to rely on
the delivery to it of a written notice by a representative of such a holder of
Senior Indebtedness or a person representing himself to be a holder of Senior
Indebtedness (or a trustee on behalf of such holder) to establish that such
notice has been given by a representative of a holder of Senior Indebtedness or
a trustee on behalf of any such holder or holders.  In the event that the Trustee determines in
good faith that further evidence is required with respect to the right of any
person as a holder of Senior Indebtedness to participate in any payment or distribution
pursuant to this Article 6, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of
Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article 6, and if such
evidence is not furnished the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.


 


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Section 6.06.  Trustee’s Relation to Senior
Indebtedness.  The Trustee in
its individual capacity shall be entitled to all the rights set forth in this Article 6
in respect of any Senior Indebtedness at any time held by it, to the same
extent as any other holder of Senior Indebtedness, and nothing in Section 10.11
or elsewhere in this Indenture shall deprive the Trustee of any of its rights
as such holder.


 


With respect
to the holders of Senior Indebtedness, the Trustee undertakes to perform or to
observe only such of its covenants and obligations as are specifically set
forth in this Article 6, 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, subject to the provisions of Section 10.01, the Trustee shall not be
liable to any holder of Senior Indebtedness if it shall, mistakenly or
otherwise, pay over or deliver to Holders of Securities, the Company or any
other person money or assets to which any holder of Senior Indebtedness shall
be entitled by virtue of this Article 6 or otherwise.


 


Section 6.07.  No Impairment of Subordination.  No right of any present or future
holder of any Senior Indebtedness to enforce subordination as herein provided
shall at any time in any way be prejudiced or impaired by any act or failure to
act on the part of the Company or by any act or failure to act, in good faith,
by any such holder, or by any noncompliance by the Company with the terms,
provisions and covenants of this Indenture, regardless of any knowledge thereof
which any such holder may have or otherwise be charged with.


 


Section 6.08.  Certain Conversions Deemed
Payment.  For the purposes of
this Article 6 only, (a)  the issuance and delivery of junior
securities upon conversion of Securities in accordance with Article 5
shall not be deemed to constitute a payment or distribution on account of the
principal of (or premium, if any) or interest on Securities or on account of
the purchase or other acquisition of Securities, and (b)  the payment,
issuance or delivery of cash (except in satisfaction of fractional shares
pursuant to Section 5.03), property or securities (other than junior
securities) upon conversion of a Security shall be deemed to constitute payment
on account of the principal of such Security. 
For the purposes of this Section 6.08, the term “junior securities”
means (i) shares of any Capital Stock of any class of the Company, or (ii) securities
of the Company which are subordinated in right of payment to all Senior
Indebtedness which may be outstanding at the time of issuance or delivery of
such securities to substantially the same extent as, or to a greater extent
than, the Securities are so subordinated as provided in this Article.  Nothing contained in this Article 6 or
elsewhere in this Indenture or in the Securities is intended to or shall
impair, as among the Company, its creditors other than holders of Senior
Indebtedness and the Holders, the right, which is absolute and unconditional,
of the Holder of any Security to convert such Security in accordance with Article 5.


 


Section 6.09.  Article Applicable to
Paying Agents.  If at any time
any Paying Agent other than the Trustee shall have been appointed by the
Company and be then acting hereunder, the term “Trustee” as used in this Article shall
(unless the context otherwise requires) be construed as extending to and including
such Paying Agent within its meaning as fully for all intents and purposes as
if such Paying Agent were named in this Article in addition to or in place
of the 


 


48

















 


Trustee; provided, however, that the first paragraph of Section 6.05
shall not apply to the Company or any Affiliate of the Company if it or such
Affiliate acts as Paying Agent.


 


Section 6.10.  Senior Indebtedness Entitled
to Rely.  The holders of
Senior Indebtedness (including, without limitation, Designated Senior
Indebtedness) shall have the right to rely upon this Article 6, and no
amendment or modification of the provisions contained herein shall diminish the
rights of such holders unless such holders shall have agreed in writing thereto.


 


Section 6.11.  Reliance on Judicial Order or
Certificate of Liquidating Agent.  Upon
any payment or distribution of assets of the Company referred to in this
Article, the Trustee, subject to the provisions of Section 7.01, and the
Holders of the Securities shall be entitled to conclusively rely upon any order
or decree entered by any court of competent jurisdiction in which such
insolvency, bankruptcy, receivership, liquidation, reorganization, dissolution,
winding up or similar case or proceeding is pending, or a certificate of the
trustee in bankruptcy, liquidating trustee, Securities Custodian, receiver,
assignee for the benefit of creditors, agent or other person making such
payment or distribution, delivered to the Trustee or to the Holders of Securities,
for the purpose of ascertaining the persons entitled to participate in such
payment or distribution, the holders of 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.


 


Section 6.12.  Rights of Trustee as Holder of
Senior Indebtedness; Preservation of Trustee’s Rights.  The Trustee or any authenticating
agent in its individual capacity shall be entitled to all the rights set forth
in this Article with respect to any Senior Indebtedness which may at any
time be held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee or any authenticating
agent of any of its rights as such holder.


 


Nothing in
this Article shall apply to claims of, or payments to, the Trustee under
or pursuant to Section 10.07.


 


ARTICLE 7

COVENANTS


 


Section 7.01.  Payment of Securities.


 


(a)        The Company shall promptly make all
payments in respect of the Securities on the dates and in the manner provided
in the Securities and this Indenture.  A
payment of principal or interest shall be considered paid on the date it is due
if the Paying Agent (other than the Company) holds by 12:00 p.m.  (noon), New York City time, on that date
money, deposited by or on behalf of the Company sufficient to make the
payment.  Subject to Section 5.02,
accrued and unpaid interest on any Security that is payable, and is punctually
paid or duly provided for, on any Interest Payment Date shall be paid to the
Person in whose name that Security is registered at the close of business on
the Regular Record Date for such interest at the office or 


 


49

















 


agency of the
Company maintained for such purpose. 
Principal, Fundamental Change Repurchase Price, and interest, if
payable, shall be considered paid on the applicable date due if on such date
(or, in the case of Fundamental Change Repurchase Price, on the Business Day
following the applicable Fundamental Change Repurchase Date) the Trustee or the
Paying Agent holds, in accordance with this Indenture, money sufficient to pay
all such amounts then due.  The Company
shall, to the fullest extent permitted by law, pay interest in immediately
available funds on overdue principal amount and interest at the annual rate
borne by the Securities compounded semiannually, which interest shall accrue
from the date such overdue amount was originally due to the date payment of
such amount, including interest thereon, has been made or duly provided
for.  All such interest shall be payable
on demand.


 


(b)        Payment of the principal of and
interest, if any, on the Securities shall be made at the office or agency of
the Company maintained for that purpose (which shall initially be at the
address set forth in Section 2.03(c)) in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts; provided, however,
that at the option of the Company payment of interest may be made by check
mailed to the address of the Person entitled thereto as such address appears in
the Register; provided further that a Holder with an aggregate principal amount
in excess of $2,000,000 will be paid by wire transfer in immediately available
funds at the election of such Holder if such Holder has provided wire transfer
instructions to the Trustee at least 10 Business Days prior to the payment
date.  Any wire transfer instructions
received by the Trustee will remain in effect until revoked by the Holder.  Notwithstanding the foregoing, so long as
this Security is registered in the name of a Depositary or its nominee, all
payments hereon shall be made by wire transfer of immediately available funds
to the account of the Depositary or its nominee.


 


Section 7.02.  SEC and Other Reports.


 


(a)        The Company shall deliver to the Trustee
all reports and other information and documents which it is required to file
with the SEC pursuant to Section 13 or 15(d) of the Exchange Act
(including its Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q),
within 15 days after it files them with the SEC; provided
that any such reports, information and documents filed with the SEC pursuant to
its Electronic Data Gathering, Analysis and Retrieval (or EDGAR) system shall
be deemed to be filed with the Trustee. 
In the event that the Company is no longer subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act, the Company
shall continue to provide the Trustee with reports containing substantially the
same information as would be required to be filed with the SEC had the Company
continued to have been subject to such reporting requirements.  In such event, such reports will be provided
at the times the Company would have been required to provide reports had it
continued to be subject to such reporting requirements.  The Company also shall comply with the
provisions of TIA Section 314(a).


 


(b)        Delivery of such reports, information
and documents to the Trustee is for informational purposes only and the
Trustee’s receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, 


 


50

















 


including the
Company’s compliance with any of its covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers’ Certificates).


 


Section 7.03.  Compliance Certificates.  The Company shall deliver to the
Trustee, within 90 days after the end of each fiscal year of the Company
(beginning with the fiscal year ending December 31, 2007), an Officers’
Certificate as to the signer’s knowledge of the Company’s compliance with all
conditions and covenants on its part contained in this Indenture and stating
whether or not the signer knows of any Default or Event of Default.  If such signer knows of such a Default or
Event of Default, the Officers’ Certificate shall describe the Default or Event
of Default and the efforts to remedy the same. 
For the purposes of this Section 7.03, compliance shall be
determined without regard to any grace period or requirement of notice provided
pursuant to the terms of this Indenture.


 


Section 7.04.  Further Instruments and
Acts.  The Company will
execute and deliver such further instruments and do such further acts as may be
reasonably necessary or proper to carry out more effectively the purposes of
this Indenture.


 


Section 7.05.  Maintenance of Corporate
Existence.  Subject to Article 8,
the Company will do or cause to be done all things necessary to preserve and
keep in full force and effect its corporate existence.


 


Section 7.06.  Stay, Extension and Usury
Laws.  The Company covenants
(to the extent that it may lawfully do so) that it shall not at any time insist
upon, plead, or in any manner whatsoever claim or take the benefit or advantage
of, any stay, extension or usury law or other law which would prohibit or
forgive the Company from paying all or any portion of the principal of or
accrued but unpaid interest on the Securities as contemplated herein, wherever
enacted, now or at any time hereafter in force, or which may affect the
covenants or the performance of this Indenture, and the Company (to the extent
it may lawfully do so) hereby expressly waives all benefit or advantage of any
such law and covenants that it will not, by resort to any such law, hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law
had been enacted.


 


Section 7.07.  Maintenance of Office or
Agency.  The Company will
maintain an office or agency of the Trustee, Registrar and Paying Agent where
securities may be presented or surrendered for payment, where Securities may be
surrendered for registration of transfer or purchase and where notices and
demands to or upon the company in respect of the Securities and this Indenture
may be served.  The Corporate Trust
Office shall initially be one such office or agency for all of the aforesaid
purposes.  The Company shall give prompt
written notice to the Trustee of the location, and of any change in the
location, of any such office or agency (other than a change in the location of
the office of the Trustee).  If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the address of the Trustee
set forth in Section 13.02.


 


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


 


ARTICLE 8

CONSOLIDATION; MERGER; CONVEYANCE; TRANSFER OR LEASE


 


Section 8.01.  Company May Consolidate,
Etc., Only on Certain Terms.  The
Company may not consolidate with or merge into any Person (unless the Company
is the surviving corporation) or convey, transfer or lease the property and
assets, substantially as an entirety, of the Company to another Person, other
than to one or more of the Company’s wholly-owned subsidiaries, unless:


 


(a)        the Person (if other than the Company)
formed by such consolidation or into which the Company is merged, or the Person
which acquires by conveyance, transfer or lease all or substantially all of the
properties and assets of the Company, shall (i) be a corporation, limited
liability company, partnership, trust or other business entity organized and
existing under the laws of the United States of America, any State thereof or
the District of Columbia and (ii) such Person (if other than the Company)
expressly assumes, by an indenture supplemental hereto, executed and delivered
to the Trustee, in form satisfactory to the Trustee, the obligations of the
Company under the Securities and this Indenture and the performance or
observance of every covenant and provision of this Indenture and the Securities
required on the part of the Company to be performed or observed and the conversion
rights shall be provided for in accordance with Article 5, by supplemental
indenture satisfactory in form to the Trustee, executed and delivered to the
Trustee, by the Person (if other than the Company) formed by such consolidation
or into which the Company shall have been merged or by the Person which shall
have acquired the Company’s assets;


 


(b)        after giving effect to such transaction,
no Event of Default, and no event which, after notice or lapse of time or both,
would become an Event of Default, shall have occurred and be continuing; and


 


(c)        if the Company will not be the resulting
or surviving corporation, the Company shall have, at or prior to the effective
date of such consolidation, merger or transfer, delivered to the Trustee an
Officers’ Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer complies with this Section 8.01 and, if
a supplemental indenture is required in connection with such transaction, such
supplemental indenture complies with this Article, and that all conditions
precedent herein provided for relating to such transaction have been complied
with.


 


Section 8.02.  Successor Substituted.  Upon any consolidation of the
Company with, or merger of the Company into, any other Person or any conveyance,
transfer or lease substantially as an entirety, of the properties and assets of
the Company and its Subsidiaries, taken as a whole, 


 


52

















 


in accordance
with Section 8.01, the successor Person formed by such consolidation or
into which the Company is merged or to which such conveyance, transfer or lease
is made shall succeed to, and be substituted for, and may exercise every right
and power of, the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein, and thereafter, except
in the case of a lease, and except for obligations the predecessor Person may
have under a supplemental indenture, the predecessor Person shall be relieved
of all obligations and covenants under this Indenture and the Securities.


 


ARTICLE 9

DEFAULT AND REMEDIES


 


Section 9.01.  Events of Default.


 


(a)        An “Event of Default” shall occur if:


 


(i)            the Company shall fail to pay when due the Principal,
Redemption Price or any Fundamental Change Repurchase Price of any Security,
when the same becomes due and payable, whether or not such payment is
prohibited by the subordination provisions hereunder; or


 


(ii)           the Company shall fail to pay an installment of interest,
on any of the Securities, which failure continues for 30 days after the date
when due whether or not such payment is prohibited by the subordination
provisions hereunder; or


 


(iii)          the Company shall fail to deliver when due all shares of
Common Stock, including any Make-Whole Premium, if any, and any cash
deliverable upon conversion of the Securities, which failure continues for 10
days; or


 


(iv)          the Company shall fail to perform or observe (or obtain a
waiver with respect to) any other term, covenant or agreement contained in the
Securities or this Indenture for a period of 75 days after receipt by the
Company of a Notice of Default specifying such failure; or


 


(v)           the Company shall fail to pay any principal by the end of
any applicable grace period or resulting in acceleration of other Indebtedness
of the Company for borrowed money where the aggregate principal amount with
respect to which the default or acceleration has occurred exceeds $15 million, provided that if any such default is cured, waived,
rescinded or annulled, then the Event of Default by reason thereof would be
deemed not to have occurred;


 


(vi)          the Company pursuant to or within the meaning of any
Bankruptcy Law:


 


(A)         commences as a debtor a voluntary case or proceeding; or


 


53

















 


(B)         consents to the entry of an order for relief against it in
an involuntary case or proceeding or the commencement of any case against it;


 


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


 


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


 


(E)          files a petition in bankruptcy or answer or consent seeking
reorganization or relief; or


 


(F)          consents to the filing of such a petition or the
appointment of or taking possession by a Receiver; or


 


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


 


(A)         grants relief against the Company in an involuntary case or
proceeding or adjudicates the Company insolvent or bankrupt;


 


(B)         appoints a Receiver of the Company or for all or
substantially all of the property of the Company; or


 


(C)         orders the winding up or liquidation of the Company;


 


and in each
case the order or decree remains unstayed and in effect for 60 consecutive
days.


 


The term
“Bankruptcy Law” means Title 11 of the United States Code (or any successor
thereto) or any similar federal or state law for the relief of debtors.  The term “Receiver” means any receiver,
trustee, assignee, liquidator, sequestrator or similar official under any
Bankruptcy Law.


 


(b)        Notwithstanding Section 9.01(a), no
Event of Default under clause (iv) of Section 9.01(a) shall
occur until the Trustee notifies the Company in writing upon the written
direction of the Holders of at least 25% in aggregate principal amount of the
Securities then outstanding, or the Holders of at least 25% in aggregate
principal amount of the Securities then outstanding notify the Company and the
Trustee in writing, of the Default (a “Notice of Default”), and the Company
does not cure the Default within the time specified in clauses (iv) of Section 9.01(a) after
receipt of such notice.  A notice given
pursuant to this Section 9.01 shall be given by registered or certified
mail, must specify the Default, demand that it be remedied and state that the
notice is a Notice of Default.  When any
Default under this Section 9.01 is cured, it ceases.


 


(c)        The Company will deliver to the Trustee,
within five Business Days after becoming aware of the occurrence of a Default
or Event of Default, written notice thereof.


 


54

















 


The Trustee
shall not be charged with knowledge of any Event of Default unless written
notice thereof shall have been given to a Responsible Officer with
responsibility for this Indenture at the Corporate Trust Office of the Trustee
by the Company, a Paying Agent, any Holder or any agent of any Holder or unless
a Responsible Officer with responsibility for this Indenture acquires actual
knowledge of such Event of Default in the course of performing other duties
pursuant to this Indenture.


 


Section 9.02.  Acceleration.  If an Event of Default (other than
an Event of Default specified in clause (vi) or (vii) of Section 9.01(a))
occurs and is continuing with respect to the Company, the Trustee may, by
notice to the Company, and shall upon the written direction of the Holders of
at least 25% in aggregate principal amount of the Securities then outstanding,
or the Holders of at least 25% in aggregate principal amount of the Securities
then outstanding may, by notice to the Company and the Trustee, declare the
principal amount and accrued and unpaid interest, if any, through the date of
declaration on all the Securities to be immediately due and payable; provided, however, that so long as any Designated Senior
Indebtedness is outstanding, such acceleration of the Securities shall not be
effective until the earlier of (x) an acceleration of such Designated
Senior Indebtedness or (y) five (5) Business Days after receipt by
the Trustee of written notice of such acceleration of the Securities.  Upon such a declaration, such principal
amount and such accrued and unpaid interest, if any, shall be due and payable
immediately.  If an Event of Default
specified in Section 9.01(a)(vi) or (vii) occurs in respect of
the Company and is continuing, the principal amount and accrued but unpaid
interest, if any, on all the Securities shall become and be immediately due and
payable without any declaration or other act on the part of the Trustee or any
Holders of Securities.  The Holders of a
majority in aggregate principal amount of the Securities then outstanding by
notice to the Trustee may rescind an acceleration and its consequences if (a) all
existing Events of Default, other than the nonpayment of the principal of the
Securities which have become due solely by such declaration of acceleration,
have been cured or waived; (b) to the extent the payment of such interest
is lawful, interest (calculated at the rate per annum borne by the Securities)
on overdue installments of interest and overdue principal, which has become due
otherwise than by such declaration of acceleration, has been paid; (c) the
rescission would not conflict with any judgment or decree of a court of
competent jurisdiction; and (d) all payments due to the Trustee and any
predecessor Trustee under Section 10.07 have been made.  No such rescission shall affect any
subsequent Default or impair any right consequent thereto.


 


Notwithstanding
the acceleration provision above, to the extent elected by the Company, the
sole remedy for an Event of Default relating to the failure to comply with the
reporting obligations in the indenture with respect to SEC filings that are
described above under Section 7.02(a), and for any failure to comply with
the requirements of Section 314(a)(1) of the Trust Indenture Act,
will for the first 180 days after the occurrence of such an Event of Default
consist exclusively of the right to receive special interest on the Securities
at an annual rate equal to 1.0% of the outstanding principal amount of the
Securities.  This special interest will
be paid semi-annually in arrears, with the first semi-annual payment due on the
first Interest Payment Date following the date on which the special interest
began to accrue on any Securities.  The
special interest will accrue on all outstanding Securities from and including
the date on which an Event of Default relating to a failure to comply with the
reporting obligations hereunder first 


 


55

















 


occurs to but
not including the 180th day (or earlier, if the Event of Default relating to
the reporting obligations is cured or waived prior to such 180th day),
whereupon such special interest will cease to accrue and, if the Event of
Default relating to reporting obligations has not been cured or waived prior to
such 180th day, the Securities will be subject to acceleration as provided
above.  In the event the Company does not
elect to pay special interest upon an Event of Default in accordance with this
paragraph, the Securities will be subject to acceleration as provided above.


 


Section 9.03.  Other Remedies.


 


(a)        If an Event of Default occurs and is
continuing, the Trustee may, but shall not be obligated to, pursue any
available remedy by proceeding at law or in equity to collect payment of the
principal amount and accrued and unpaid interest, if any, on the Securities or
to enforce the performance of any provision of the Securities or this
Indenture.


 


(b)        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 Holder in exercising any right or remedy accruing upon an
Event of Default shall not impair the right or remedy or constitute a waiver of
or acquiescence in the Event of Default. 
No remedy is exclusive of any other remedy.  All available remedies are cumulative to the
extent permitted by applicable law.


 


Section 9.04.  Waiver of Defaults and Events
of Default.  Subject to
Sections 9.02, 9.07 and 12.02, the Holders of a majority in aggregate principal
amount of the Securities then outstanding by notice to the Trustee may waive an
existing Default or Event of Default and its consequences, except an uncured
Default or Event of Default in the payment of the principal of, premium, if
any, or any accrued but unpaid interest on any Security, an uncured failure by
the Company to convert any Securities into Common Stock or any Default or Event
of Default in respect of any provision of this Indenture or the Securities
which, under Section 12.02, cannot be modified or amended without the
consent of the Holder of each Security affected.  When a Default or Event of Default is waived,
it is cured and ceases to exist.


 


Section 9.05.  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, that the Trustee
determines may be unduly prejudicial to the rights of another Holder or the
Trustee, or that may involve the Trustee in personal liability unless the
Trustee is offered security or indemnity satisfactory to it; provided, however, that the Trustee may take any other
action deemed proper by the Trustee which is not inconsistent with such
direction.


 


56

















 


Section 9.06.  Limitations on Suits.


 


(a)        A Holder may not pursue any remedy with
respect to this Indenture or the Securities (except actions for payment of
overdue principal, premium, if any, or interest or for the conversion of the Securities
pursuant to Article 5) unless:


 


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


 


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


 


(iii)          such Holder or Holders offer to the Trustee security or
indemnity acceptable to the Trustee against any loss, liability or expense;


 


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


 


(v)           no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of a
majority in aggregate principal amount of the Securities then outstanding.


 


(b)        No Holder of a Security shall have any
right under any provision of this Indenture or the Securities to affect,
disturb, or prejudice the rights of another Holder of a Security or to obtain a
preference or priority over another Holder of a Security.


 


Section 9.07.  Rights of Holders to Receive
Payment and to Convert.  Notwithstanding
any other provision of this Indenture, the right of any Holder of a Security to
receive payment of the principal amount, Fundamental Change Repurchase Price,
or Make-Whole Premium and interest, if any in respect of the Securities held by
such Holder, on or after the respective due dates expressed in the Securities
and this Indenture, (whether upon repurchase or otherwise), and to convert such
Security in accordance with Article 5, and to bring suit for the
enforcement of any such payment on or after such respective due dates or for
the right to convert in accordance with Article 5, is, subject to
compliance with the provisions of Section 9.06, absolute and unconditional
and shall not be impaired or affected without the consent of the Holder.


 


Section 9.08.  Collection Suit by
Trustee.  If an Event of
Default described in clause (i) or (ii) of Section 9.01(a) occurs
and is continuing, the Trustee may recover judgment in its own name and as
trustee of an express trust against the Company or another obligor on the
Securities for the whole amount owing with respect to the Securities and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.


 


Section 9.09.  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 (including any claim for
the reasonable compensation, expenses, 


 


57

















 


disbursements
and advances of the Trustee, its agents and counsel) and the Holders allowed in
any judicial proceedings relative to the Company (or any other obligor on the
Securities), its creditors or its property and shall be entitled and empowered
to collect and receive any money or other property payable or deliverable on
any such claims and to distribute the same, and any Receiver in any such
judicial proceeding is hereby authorized by each Holder to make such payments
to the Trustee and, in the event that the Trustee shall consent to the making
of such payments directly to the Holders, to pay to the Trustee any amount due
to it for the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel, and any other amounts due the Trustee
under Section 10.07, and to the extent that such payment of the reasonable
compensation, expenses, disbursements and advances in any such proceedings
shall be denied for any reason, payment of the same shall be secured by a lien
on, and shall be paid out of, any and all distributions, dividends, money,
securities and other property which the Holders may be entitled to receive in
such proceedings, whether in liquidation or under any plan of reorganization or
arrangement or otherwise.  Nothing herein
contained shall be deemed to authorize the Trustee to authorize or consent to,
or, on behalf of any Holder, to authorize, accept or adopt 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.


 


Section 9.10.  Priorities.


 


(a)        If the Trustee collects any money
pursuant to this Article 9, it shall pay out the money in the following
order:


 


(i)            First, to the Trustee for amounts due under Section 10.07;


 


(ii)           Second, to the Holders of Senior Indebtedness to the
extent required by Article 6;


 


(iii)          Third, to Holders for amounts due and unpaid on the
Securities for the principal amount and interest, as applicable, ratably,
without preference or priority of any kind, according to such respective
amounts due and payable on the Holders’ Securities; and


 


(iv)          Fourth, the balance, if any, to the Company.


 


(b)        The Trustee may fix a record date and
payment date for any payment to Holders pursuant to this Section 9.10.


 


Section 9.11.  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 of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys’ fees and expenses (whether incurred
before trial, at trial, on appeal or in any bankruptcy or arbitration or other
administrative proceeding), against any 


 


58

















 


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 9.11 does not apply to a suit made by the Trustee, a suit by a
Holder pursuant to Section 9.07, or a suit by Holders of more than 10% in
aggregate principal amount of the Securities then outstanding.  This Section 9.11 shall be in lieu of Section 315(e) of
the TIA and such Section 315(e) is hereby expressly excluded from
this Indenture, as permitted by the TIA.


 


ARTICLE 10

TRUSTEE


 


Section 10.01.  Obligations of Trustee.


 


(a)        If an Event of Default of which a
Responsible Officer of the Trustee shall have actual knowledge has occurred and
is continuing, the Trustee may (and shall upon the written direction of the
Holders of at least 25% in aggregate principal amount of the Securities then
outstanding and being furnished with indemnity acceptable to it) exercise such
of the rights and powers vested in it by this Indenture.  If an Event of Default of which a Responsible
Officer of the Trustee shall have actual knowledge has occurred and is
continuing, the Trustee shall use the same degree of care and skill in its
exercise as a prudent person would exercise or use under the circumstances in
the conduct of his or her own affairs.


 


(b)        Except during the continuance of an
Event of Default of which a Responsible Officer of the Trustee shall have
actual knowledge, the Trustee need perform only those duties as are
specifically set forth in this Indenture and no others.


 


This Section 10.01(b) shall
be in lieu of Section 315(a) of the TIA and such Section 315(a) is
hereby expressly excluded from this Indenture, as permitted by the TIA.


 


(c)        In the absence of bad faith on its part,
the Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or opinions
furnished to the Trustee and conforming to the requirements of this
Indenture.  The Trustee, however, shall
examine any certificates and opinions which by any provision hereof are
specifically required to be delivered to the Trustee to determine whether or
not they conform on their face to the requirements of this Indenture, but need
not confirm or investigate the accuracy of mathematical calculations or other
facts stated therein


 


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


 


(i)            this paragraph does not limit the effect of Section 10.01(b);


 


(ii)           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 grossly negligent in ascertaining the pertinent facts; and


 


59

















 


(iii)          the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with this Indenture or a
direction received by it pursuant to Section 9.05.


 


This Section 10.01(d) shall
be in lieu of Sections 315(d)(1), 315(d)(2) and 315(d)(3) of the TIA
and such Sections are hereby expressly excluded from this Indenture as
permitted by the TIA.


 


(e)        No provision of this Indenture shall
require the Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder or in the
exercise of any of its rights or powers unless the Trustee shall have received
adequate security or indemnity in its opinion against potential costs and
liabilities incurred by it relating thereto.


 


(f)         Every provision of this Indenture that
in any way relates to the Trustee is subject to subsections (a), (b), (c), (d) and
(e) of this Section 10.01.


 


(g)        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.


 


(h)        The Trustee shall not be liable for any
delays occurring as a result of force majeure.


 


Section 10.02.  Rights of Trustee.


 


(a)        Subject to Section 10.01:


 


(i)            The Trustee may rely conclusively and shall be protected
in acting or refraining from acting upon 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.


 


(ii)           Before the Trustee acts or refrains from acting, it may
require an Officers’ Certificate or an Opinion of Counsel, which shall conform
to Section 13.04(b).  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.


 


(iii)          The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents, attorneys or custodians, and the Trustee shall not be responsible for
any misconduct or negligence on the part of any such agent, attorney or
custodian appointed by the Trustee with due care.


 


(iv)          The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers.


 


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(v)           The Trustee may consult with counsel of its selection, and
the advice or opinion of such counsel as to matters of law shall be full and
complete authorization and protection in respect of any such action taken,
omitted or suffered by it hereunder in good faith and in accordance with the
advice or opinion of such counsel.


 


(vi)          The Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Indenture or to institute, conduct or
defend any litigation hereunder or in relation hereto 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 satisfactory to the Trustee
against the costs, expenses and liabilities which might be incurred by it in
compliance with such request or direction.


 


(vii)         The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document, but
the Trustee, in its discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit, and, if the Trustee shall
determine to make such further inquiry or investigation, it shall be entitled
to examine the books, records and premises of the Company, personally or by
agent or attorney at the sole cost of the Company, and shall incur no liability
or additional liability of any kind by reason of such inquiry or investigation.


 


(viii)        The Trustee shall not be deemed to have notice or knowledge
of any Default or Event of Default, or Fundamental Change unless a Responsible
Officer of the Trustee has actual knowledge thereof or unless written notice of
any event which is in fact such a Default is received by the Trustee at the
Corporate Trust Office, and such notice references the Securities and this
Indenture.  In the absence of receipt of
such notice or actual knowledge, the Trustee may conclusively assume that there
is no Default, Event of Default, or Fundamental Change.


 


(ix)           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, including, without limitation as Paying Agent,
Registrar and Conversion Agent, and to each agent, custodian and other Person
employed to act hereunder.


 


(x)            In no event shall the Trustee be responsible or liable
for special, indirect, or consequential loss or damage of any kind whatsoever
(including, but not limited to, loss of profit) irrespective of whether the
Trustee has been advised of the likelihood of such loss or damage and
regardless of the form of action.


 


Section 10.03.  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 an Affiliate of the Company with the
same rights it would have if it were not 


 


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Trustee.  Any Agent may do the same with like
rights.  However, the Trustee is subject
to Sections 10.10 and 10.11.


 


Section 10.04.  Trustee’s Disclaimer.  The Trustee makes no
representation as to the validity or adequacy of this Indenture or the
Securities.  It shall not be accountable
for the Company’s use of the proceeds from the Securities and it shall not be
responsible for any statement in the Securities other than its certificate of
authentication.


 


Section 10.05.  Notice of Default or Events of
Default.  If a Default or an
Event of Default occurs and is continuing and if it is known to a Responsible
Officer of the Trustee, the Trustee shall mail to each Holder of a Security
notice of all uncured Defaults or Events of Default known to it within 90 days
after it occurs or, if later, within 15 days after it becomes known to the Trustee.  However, the Trustee may withhold the notice
if and for so long as a committee of its Responsible Officers in good faith
determines that withholding notice is in the interests of Holders of
Securities, except in the case of a Default or an Event of Default in payment
of the principal of, or premium, if any, or interest on any Security when due
or in the payment of any purchase obligation, or the Company’s failure to
convert Securities when obligated to convert them.  This Section 10.05 is in lieu of section
315(b) of the TIA and such provision is expressly excluded from this
Indenture as permitted by the TIA.


 


Section 10.06.  Reports by Trustee to Holders.


 


(a)        If a report is required by TIA Section 313,
within 60 days after each May 15, beginning with the May 15 following
the date of this Indenture, the Trustee shall mail to each Holder of Securities
a brief report dated as of such May 15 that complies with TIA Section 313(a).  If required by TIA Section 313, the
Trustee also shall comply with TIA Sections 313(b)(2), (c) and (d).


 


(b)        A copy of each report at the time of its
mailing to Holders of Securities shall be mailed to the Company and, to the
extent required by the TIA, filed with the SEC, and each stock exchange, if
any, on which the Securities are listed. 
The Company shall notify the Trustee whenever the Securities become
listed on any stock exchange or listed or admitted to trading on any quotation
system and any changes in the stock exchanges or quotation systems on which the
Securities are listed or admitted to trading and of any delisting thereof.


 


Section 10.07.  Compensation and Indemnity.


 


(a)        The Company shall pay to the Trustee
from time to time such compensation (as agreed to from time to time by the
Company and the Trustee in writing) for its services (which compensation shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust).  The
Company shall reimburse the Trustee upon request for all reasonable
disbursements, expenses and advances incurred or made by it.  Such expenses may include the reasonable
compensation, disbursements and expenses of the Trustee’s agents and counsel.


 


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(b)        The Company shall indemnify and hold
harmless the Trustee or any predecessor Trustee (which for purposes of this Section 10.07
shall include its officers, directors, employees and agents) for, and hold it
harmless against, any and all loss, liability, claim, damage or expense
including taxes (other than franchise taxes and taxes based upon, measured by
or determined by the income of the Trustee), incurred by it in connection with
the acceptance or administration of its duties under this Indenture or any
action or failure to act as authorized or within the discretion or rights or
powers conferred upon the Trustee hereunder including the reasonable costs and
expenses of the Trustee and its counsel in defending (including reasonable
legal fees and expenses whether incurred before trial, at trial, on appeal or
in any bankruptcy or arbitration or other administrative proceeding) itself
against any claim or liability in connection with the exercise or performance
of any of its powers or duties hereunder. 
The Trustee shall notify the Company promptly of any claim asserted
against the Trustee of which it has received written notice for which it may
seek indemnity.  The Company need not pay
for any settlement effected without its prior written consent, which shall not
be unreasonably withheld.


 


(c)        The Company need not reimburse the
Trustee for any expense or indemnify it against any loss or liability
determined to have been caused by its own gross negligence, willful misconduct
or bad faith.


 


(d)        To secure the Company’s payment
obligations in this Section 10.07, the Trustee shall have a senior claim
to which the Securities are hereby made subordinate on all money or property
held or collected by the Trustee.  The
obligations of the Company under this Section 10.07 shall survive the
satisfaction and discharge of this Indenture or the resignation or removal of
the Trustee.


 


(e)        When the Trustee incurs expenses or
renders services after an Event of Default specified in clause (vi) or (vii) of
Section 9.01(a) occurs, the expenses and the compensation for the
services are intended to constitute expenses of administration under any
Bankruptcy Law.  The provisions of this Section shall
survive the termination of this Indenture.


 


Section 10.08.  Replacement of Trustee.


 


(a)        The Trustee may resign by so notifying
the Company.  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 and may, with the Company’s
written consent, appoint a successor Trustee. 
The Company may remove the Trustee at any time, so long as no Default or
Event of Default has occurred and is continuing, and appoint a Successor
Trustee in accordance with this Section 10.08.


 


(b)        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. 
The resignation or removal of a Trustee shall not be effective until a
successor Trustee shall have delivered the written acceptance of its
appointment as described below.


 


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(c)        If a successor Trustee does not take
office within 45 days after the retiring Trustee resigns or is removed, the
retiring Trustee, the Company or the Holders of 10% in principal amount of the
Securities then outstanding may petition any court of competent jurisdiction at
the expense of the Company for the appointment of a successor Trustee at the
expense of the Company.


 


(d)        If the Trustee fails to comply with Section 10.10,
any Holder may petition any court of competent jurisdiction for the removal of
the Trustee and the appointment of a successor Trustee.


 


(e)        A successor Trustee shall deliver a
written acceptance of its appointment to the retiring Trustee and to the
Company.  Promptly thereafter, the retiring
Trustee shall (upon payment of its charges hereunder) transfer all property
held by it as Trustee to the successor Trustee and be released from its
obligations (exclusive of any liabilities that the retiring Trustee may have
incurred while acting as Trustee) hereunder, 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.  A successor Trustee shall mail notice of its
succession to each Holder.


 


(f)         A retiring Trustee shall not be liable
for the acts or omissions of any successor Trustee after its succession.


 


(g)        Notwithstanding replacement of the
Trustee pursuant to this Section 10.08, the Company’s obligations under Section 10.07
shall continue for the benefit of the retiring Trustee.


 


Section 10.09.  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 (including the administration of this
Indenture) to, another corporation, the resulting, surviving or transferee
corporation, without any further act, shall be the successor Trustee; provided
such transferee corporation shall qualify and be eligible under Section 10.10.  Such successor Trustee shall promptly mail
notice of its succession to the Company and each Holder.


 


Section 10.10.  Eligibility;
Disqualification.  The Trustee
shall always satisfy the requirements of paragraphs (1), (2) and (5) of
TIA Section 310(a).  The Trustee (or
its parent holding company) shall have a combined capital and surplus of at
least $50,000,000 as set forth in its most recent published annual report of
condition.  If at any time the Trustee
shall cease to satisfy any such requirements, it shall resign immediately in
the manner and with the effect specified in this Article 10.  The Trustee shall be subject to the
provisions of TIA Section 310(b). 
Nothing herein shall prevent the Trustee from filing with the SEC the
application referred to in the penultimate paragraph of TIA Section 310(b).


 


Section 10.11.  Preferential Collection of
Claims Against Company.  The
Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). 
A Trustee who has resigned or been removed shall be subject to TIA Section 311(a) to
the extent indicated therein.


 


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ARTICLE 11

SATISFACTION AND DISCHARGE OF INDENTURE


 


Section 11.01.  Satisfaction and Discharge of
Indenture.


 


(a)        This Indenture shall cease to be of
further force and effect (except as to any surviving rights of conversion,
registration of transfer or exchange of Securities herein expressly provided
for and except as further provided below), and the Trustee, on demand of and at
the expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when either:


 


(i)            all Securities theretofore authenticated and delivered
(other than (A) Securities which have been destroyed, lost or stolen and
which have been replaced or paid as provided in Section 2.07 and (B) Securities
for whose payment money has theretofore been deposited in trust and thereafter
repaid to the Company as provided in Section 11.03) have been delivered to
the Trustee for cancellation; or


 


(ii)           all such Securities not theretofore delivered to the
Trustee for cancellation,


 


(A)         have become due and payable, or


 


(B)         will become due and payable at the Final Maturity Date
within one year; provided in the case of clause (ii), that


 


(1)          the Company has deposited with the Trustee or a Paying
Agent (other than the Company or any of its Affiliates) as trust funds in trust
for the purpose of and in an amount sufficient to pay and discharge all
indebtedness related to such Securities not theretofore delivered to the
Trustee for cancellation, for principal and interest to the date of such
deposit (in the case of Securities which have become due and payable) or to the
Final Maturity Date, as the case may be;


 


(2)          the Company has paid or caused to be paid all other sums
payable hereunder by the Company; and


 


(3)          the Company has delivered to the Trustee an Officers’
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein relating to the satisfaction and discharge of this Indenture
have been complied with.


 


(b)        Notwithstanding the satisfaction and
discharge of this Indenture, the obligations of the Company with respect to the
conversion privilege and the Conversion Rate of the Securities pursuant to Article 5,
the obligations of the Company to the Trustee under Section 10.07 and, if
money shall have been deposited with the Trustee pursuant to clause (ii) of
Section 11.01(a), the provisions of Sections 2.03, 2.04, 2.05, 2.06, 2.07,
2.12, 7.01 and 13.05, Article 5, and this Article 11, shall survive
such satisfaction and discharge until the Securities have been paid in full.


 


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Section 11.02.  Application of Trust
Money.  Subject to the provisions
of Section 11.03, the Trustee or a Paying Agent shall hold in trust, for
the benefit of the Holders, all money deposited with it pursuant to Section 11.01
and shall apply the deposited money in accordance with this Indenture and the
Securities to the payment of the principal of and interest on the Securities.


 


Section 11.03.  Repayment to Company.


 


(a)        The Trustee and each Paying Agent shall
promptly pay to the Company upon request any excess money (i) deposited
with them pursuant to Section 11.01 and (ii) held by them at any
time.


 


(b)        The Trustee and each Paying Agent shall,
subject to applicable abandonment property laws, pay to the Company upon
request any money held by them for the payment of principal or interest that
remains unclaimed for two years after a right to such money has matured; provided, however, that the Trustee or such Paying Agent,
before being required to make any such payment, may at the expense of the
Company cause to be mailed to each Holder entitled to such money notice that such
money remains unclaimed and that after a date specified therein, which shall be
at least 30 days from the date of such mailing, any unclaimed balance of such
money then remaining will be repaid to the Company.  After payment to the Company, Holders entitled
to money must look to the Company for payment as general creditors unless an
applicable abandoned property law designates another person.


 


Section 11.04.  Reinstatement.  If the Trustee or any Paying Agent
is unable to apply any money in accordance with Section 11.02 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, then the Company’s obligations under this Indenture and the Securities
shall be revived and reinstated as though no deposit had occurred pursuant to Section 11.01
until such time as the Trustee or such Paying Agent is permitted to apply all
such money in accordance with Section 11.02; provided,
however, that if the Company has made any payment of the principal
of or interest on 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 any such payment from the money held by the Trustee
or such Paying Agent.


 


ARTICLE 12

AMENDMENTS; SUPPLEMENTS AND WAIVERS


 


Section 12.01.  Without Consent of Holders.


 


(a)        The Company and the Trustee may amend or
supplement this Indenture or the Securities without notice to or consent of any
Holder of a Security for the purpose of:


 


(i)            evidencing a successor to the Company and the assumption
by that successor of the Company’s obligations under this Indenture and the
Securities;


 


66

















 


(ii)           adding to the Company’s covenants for the benefit of the
Holders or surrendering any right or power conferred upon the Company;


 


(iii)          securing the Company’s obligations in respect of the
Securities;


 


(iv)          evidencing and providing for the acceptance of the appointment
of a successor trustee in accordance with Article 10;


 


(v)           complying with the requirements of the SEC in order to
maintain the qualification of this Indenture under the TIA, as contemplated by
this Indenture or otherwise;


 


(vi)          to conform the provisions of this Indenture to the
“Description of the Notes” section contained in the final prospectus of the
Company dated January      , 2008;


 


(vii)         curing any ambiguity, omission, inconsistency or correcting
or supplementing any defective provision contained in this Indenture; or


 


(viii)        making any other changes to the Indenture that do not
adversely affect the rights of the Holders in any material respect.


 


Section 12.02.  With Consent of Holders.


 


(a)        The Company and the Trustee may amend or
supplement this Indenture or the Securities with the written consent of the
Holders of at least a majority in aggregate principal amount of the Securities
then outstanding.  However, subject to Section 12.04,
without the written consent of each Holder affected, an amendment, supplement
or waiver may not:


 


(i)            alter the manner of calculation or rate of accrual of
interest on any Security or change the time of payment of any installment of
interest on, any Security;


 


(ii)           make any of the Securities payable in money or securities
other than that stated in the Securities;


 


(iii)          change the stated maturity of any Security;


 


(iv)          reduce the principal amount or Fundamental Change
Repurchase Price (as applicable) with respect to any of the Securities;


 


(v)           make any change that adversely affects the rights of
Holders to require the Company to purchase Securities at the option of Holders;


 


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


 


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(vii)         change the currency of payment of principal of, or interest
on, the Securities;


 


(viii)        except as otherwise permitted or contemplated by Section 5.10,
adversely affect the conversion rights (including any Make-Whole Premium) of
the Securities; or


 


(ix)           change the percentage in aggregate principal amount of
Securities outstanding necessary to modify or amend this Indenture or to waive
any past Default.


 


(b)        Without limiting the provisions of Section 12.02(a) hereof,
the Holders of a majority in aggregate principal amount of the Securities then
outstanding may, on behalf of all the Holders of all Securities, (i) waive
compliance by the Company with the restrictive provisions of this Indenture,
and (ii) waive any past Default or Event of Default under this Indenture
and its consequences, except an uncured failure to pay when due the principal
amount, accrued and unpaid interest or Fundamental Change Repurchase Price, or
in the obligation to deliver Common Stock, if any and as applicable, or in
respect of any provision which under this Indenture cannot be modified or
amended without the consent of the Holder of each outstanding Security
affected.


 


(c)        After an amendment, supplement or waiver
under this Section 12.02 becomes effective, the Company shall promptly
mail to the Holders affected thereby a notice briefly describing the amendment,
supplement or waiver.  Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such amendment, supplement or waiver.


 


Section 12.03.  Compliance with Trust
Indenture Act.  Every
amendment to or supplement of this Indenture or the Securities shall comply
with the TIA as in effect at the date of such amendment or supplement.


 


Section 12.04.  Revocation and Effect of
Consents.


 


(a)        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.


 


(b)        After an amendment, supplement or waiver
becomes effective, it shall bind every Holder of a Security.


 


Section 12.05.  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 about the changed terms and return it to the Holder.  Alternatively, if the Company or the Trustee
so 


 


68

















 


determines,
the Company in exchange for the Security shall issue and the Trustee shall
authenticate a new Security that reflects the changed terms.


 


Section 12.06.  Trustee to Sign Amendments,
Etc.  The Trustee shall sign
any amendment or supplemental indenture authorized pursuant to this Article 12
if the amendment or supplemental indenture does not adversely affect the
rights, duties, liabilities or immunities of the Trustee.  If it does, the Trustee may, in its sole
discretion, but need not sign it.  In
signing or refusing to sign such amendment or supplemental indenture, the
Trustee shall be provided with and, subject to Section 10.01, shall be
fully protected in relying upon, an Opinion of Counsel and an Officers’
Certificate stating that such amendment or supplemental indenture is authorized
or permitted by this Indenture.  The
Company may not sign an amendment or supplemental indenture until the Board of
Directors approves it.


 


Section 12.07.  Effect of Supplemental
Indentures.  Upon the
execution of any supplemental indenture under this Article 12, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every
Holder of Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.


 


ARTICLE 13

MISCELLANEOUS


 


Section 13.01.  Trust Indenture Act
Controls.  If any provision of
this Indenture limits, qualifies or conflicts with the duties imposed by any of
Sections 310 to 317, inclusive, of the TIA through operation of Section 318(c) thereof,
such imposed duties shall control.


 


Section 13.02.  Notices.  Any demand, authorization notice,
request, consent or communication shall be given in writing and delivered in
person or mailed by first-class mail, postage prepaid, addressed as follows or
transmitted by facsimile transmission (confirmed by delivery in person or mail
by first-class mail, postage prepaid, or by guaranteed overnight courier) to
the following facsimile numbers:


 


If to the
Company, to:


 


Theravance, Inc.


901
Gateway  Boulevard


South San
Francisco, CA  94080


Attn:  General Counsel


Fax:  650-808-6019


 


69

















 


with a copy
to:


 


Gunderson
Dettmer Stough Villeneuve Franklin & Hachigian LLP


155
Constitution Avenue


Menlo Park,
CA  94025


Attn:  David Young


Fax:  650-321-2800


 


and


 


Shearman &
Sterling LLP


525 Market
Street


San Francisco,
CA  94105


Attn:  Mark Hyland


Fax:  415-616-1381


 


if to the
Trustee, to:


 


The Bank of
New York Trust Company, N.A.


700 South
Flower Street


Suite 500


Los Angeles,
CA 90017


Attn:
Corporate Unit


Fax:
213-630-6298


 


Such notices
or communications shall be effective when received.


 


The Company or
the Trustee by notice to the other may designate additional or different
addresses for subsequent notices or communications.  Notice to or from the Trustee shall not be
via electronic mail.  Notices to the
Trustee via facsimile shall promptly be followed by the original written
notice.


 


Any notice or
communication mailed to a Holder of a Security shall be mailed by first-class
mail or delivered by an overnight delivery service to it at its address shown
on the register kept by the Primary Registrar.


 


The Trustee
agrees to accept and act upon facsimile transmission of written instructions
and/or directions pursuant to this Indenture given by the Company, provided, however that: (i) the Company, subsequent to
such facsimile transmission of written instructions and/or directions, shall
provide the originally executed instructions and/or directions to the Trustee
in a timely manner and (ii) such originally executed instructions and/or
directions shall be signed by an “Officer” of the Company


 


Failure to
mail a notice or communication to a Holder of a Security or any defect in it
shall not affect its sufficiency with respect to other Holders of
Securities.  If a notice or 


 


70

















 


communication
to a Holder of a Security is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.


 


If the Company
mails any notice to a Holder of a Security, it shall mail a copy to the Trustee
and each Registrar, Paying Agent and Conversion Agent.


 


Section 13.03.  Communications by Holders with
Other Holders.  Holders of
Securities may communicate pursuant to TIA Section 312(b) with other
Holders of Securities with respect to their rights under this Indenture or the
Securities.  The Company, the Trustee,
the Registrar and any other person shall have the protection of TIA Section 312(c).


 


Section 13.04.  Certificate and Opinion as to
Conditions Precedent.


 


(a)        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 at the request of the Trustee:


 


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


 


(ii)           an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent (including any covenants, compliance
with which constitutes a condition precedent) have been complied with.


 


(b)        Each Officers’ Certificate and 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;


 


provided,
however, that with respect to matters of fact an
Opinion of Counsel may rely on an Officers’ Certificate or certificates of
public officials.


 


71

















 


Section 13.05.  Record Date for Vote or
Consent of Holders of Securities.  The
Company (or, in the event deposits have been made pursuant to Section 11.01,
the Trustee) may set a record date for purposes of determining the identity of
Holders entitled to vote or consent to any action by vote or consent authorized
or permitted under this Indenture, which record date shall not be more than 30
days prior to the date of the commencement of solicitation of such action.  Notwithstanding the provisions of Section 12.04,
if a record date is fixed, those persons who were Holders of Securities at the
close of business on such record date (or their duly designated proxies), and
only those persons, shall be entitled to take such action by vote or consent or
to revoke any vote or consent previously given, whether or not such persons
continue to be Holders after such record date.


 


Section 13.06.  Rules by Trustee, Paying
Agent, Registrar and Conversion Agent.  The
Trustee may make reasonable rules (not inconsistent with the terms of this
Indenture) for action by or at a meeting of Holders.  Any Registrar, Paying Agent or Conversion
Agent may make reasonable rules for its functions.


 


Section 13.07.  Legal Holidays.  A “Legal Holiday” is a Saturday,
Sunday or a day on which state or federally chartered banking institutions in
New York, New York or Los Angeles, California are authorized or obligated to
close.  If a payment date is a Legal
Holiday, payment shall be made on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue for the intervening period.  If a Regular Record Date is a Legal Holiday,
the record date shall not be affected.


 


Section 13.08.  Governing Law.  This Indenture and the Securities
shall be governed by, and construed in accordance with, the laws of the State
of New York.


 


Section 13.09.  No Adverse Interpretation of
Other Agreements.  This
Indenture may not be used to interpret another indenture, loan or debt
agreement of the Company or a Subsidiary of the Company.  Any such indenture, loan or debt agreement
may not be used to interpret this Indenture.


 


Section 13.10.  No Recourse Against
Others.  All liability
described in paragraph 17 of the Securities of any director, officer, employee
or shareholder, as such, of the Company hereby is waived and released by each
of the Holders.


 


Section 13.11.  No Security Interest
Created.  Nothing in this
Indenture or in the Securities, express or implied, shall be construed to
constitute a security interest under the Uniform Commercial Code or similar
legislation, now in effect or hereafter enacted and made effective, in any
jurisdiction.


 


Section 13.12.  Successors.  All agreements of the Company in
this Indenture and the Securities shall bind its successor.  All agreements of the Trustee in this
Indenture shall bind its successor.


 


72

















 


Section 13.13.  Multiple Counterparts.  The parties may sign multiple
counterparts of this Indenture.  Each
signed counterpart shall be deemed an original, but all of them together
represent the same agreement.


 


Section 13.14.  Separability.  If any provisions in this
Indenture or in the Securities shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.


 


Section 13.15.  Table of Contents, Headings,
Etc.  The table of contents,
cross-reference sheet 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.


 


Section 13.16.  Waiver of Jury Trial.  EACH OF THE COMPANY AND THE
TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS INDENTURE, THE NOTES OR THE TRANSACTION
CONTEMPLATED HEREBY.


 


Section 13.17.  Force Majeure.  In no event shall the Trustee be
responsible or liable for any failure or delay in the performance of its
obligations hereunder arising out of or caused by, directly or indirectly,
forces beyond its control, including, without limitation, strikes, work
stoppages, accidents, acts of war or terrorism, civil or military disturbances,
nuclear or natural catastrophes or acts of God, and interruptions, loss or
malfunctions of utilities, communications or computer (software and hardware)
services; it being understood that the Trustee shall use reasonable efforts
which are consistent with accepted practices in the banking industry to resume
performance as soon as practicable under the circumstances.


 


[SIGNATURE PAGE FOLLOWS]


 


73

















 


IN WITNESS
WHEREOF, the parties hereto have hereunto set their hands as of the date and
year first above written.


 


	
   

  	
  THERAVANCE,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


 


	
   

  	
  THE BANK OF
  NEW YORK TRUST

  COMPANY, N.A., as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 

















 


EXHIBIT A


 


[FORM OF FACE OF SECURITY]


 


UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY 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 THE DEPOSITORY TRUST
COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO.  OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.  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 THEREOF.  THIS SECURITY IS EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE
ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND, UNLESS AND
UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE
FORM, THIS 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.(1)


 






(1) This
paragraph should be included if the Security is a Global Security.


 


A-1

















 


THERAVANCE, INC.


% Convertible Subordinated Notes due 2015


 


	
  No.

  	
  CUSIP: 88338T
  AA2

  



 


Theravance, Inc.,
a Delaware corporation, promises to pay to Cede & Co.  or registered assigns the principal amount
of                      
($          ) on January 15,
2015.


 


This Security
shall bear interest as specified on the other side of this Security.  This Security is convertible as specified on
the other side of this Security.


 


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


 


Dated: January       , 2008


 


[SIGNATURE PAGE FOLLOWS]


 


A-2

















 


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


 


	
   

  	
  THERAVANCE,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


 


Dated: January     , 2008


 


Trustee’s
Certificate of Authentication:


This is one of
the Securities referred to in


the
within-mentioned Indenture.


 


THE BANK OF
NEW YORK 


TRUST COMPANY,
N.A., as Trustee


 


 


	
  By:

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  



 


A-3

















 


[FORM OF
REVERSE SIDE OF SECURITY]


 


THERAVANCE, INC.


% CONVERTIBLE SUBORDINATED NOTES DUE 2015


 


1.             INTEREST


 


Theravance, Inc.,
a Delaware corporation (the “Company”, which term shall include any successor
corporation under the Indenture hereinafter referred to), promises to pay
interest on the principal amount of this Security at the rate of         % per annum.  The Company shall pay interest semiannually
on January 15 and July 15 of each year (each an “Interest Payment
Date”), commencing July 15, 2008. 
Each payment of interest will include interest accrued for the period
commencing on and including the immediately preceding Interest Payment Date, provided that the first interest payment on July 15,
2008, will include interest from January      , 2008 through the day before the relevant
Interest Payment Date (or purchase date, as the case may be).  Cash interest will be computed on the basis
of a 360-day year comprised of twelve 30-day months.  Any payment required to be made on a day that
is not a Business Day shall be made on the next succeeding Business Day.


 


No sinking
fund is provided for the Securities.


 


2.             METHOD OF PAYMENT


 


The Company
shall pay interest on this Security (except defaulted interest) to the person
who is the Holder of this Security at the close of business on January 1
or July 1, as the case may be, (each, a “Regular Record Date”) next
preceding the related Interest Payment Date. 
The Holder must surrender this Security to a Paying Agent to collect
payment of principal.  The Company will
pay principal and interest in money of the United States that at the time of
payment is legal tender for payment of public and private debts.  The Company may pay principal and interest in
respect of any Certificated Security by check or wire payable in such money; provided, however, that a Holder with an aggregate principal
amount in excess of $2,000,000 will be paid by wire transfer in immediately
available funds at the election of such Holder if such Holder has provided wire
transfer instructions to the Trustee at least 10 Business Days prior to the
Payment Date.  The Company may mail an
interest check to the Holder’s registered address.  Notwithstanding the foregoing, so long as
this Security is registered in the name of a Depositary or its nominee, all
payments hereon shall be made by wire transfer of immediately available funds
to the account of the Depositary or its nominee.


 


Any wire
transfer instructions received by the Trustee will remain in effect until
revoked by the Holder.


 


3.             PAYING AGENT,
REGISTRAR AND CONVERSION AGENT


 


Initially, The
Bank of New York Trust Company, N.A. (the “Trustee”, which term shall include
any successor trustee under the Indenture hereinafter referred to) will act as
Paying 


 


A-4

















 


Agent,
Registrar and Conversion Agent.  The Company
may change any Paying Agent, Registrar or Conversion Agent without notice to
the Holder.  The Company or any of its
Subsidiaries may, subject to certain limitations set forth in the Indenture,
act as Paying Agent or Registrar.


 


4.             INDENTURE,
LIMITATIONS


 


This Security
is one of a duly authorized issue of Securities of the Company designated as
its       % Convertible Subordinated
Notes Due 2015 (the “Securities”), issued under an Indenture dated as of January     , 2008 (together with any supplemental indentures
thereto, the “Indenture”), between the Company and the Trustee.  The terms of this Security include those
stated in the Indenture and those required by or made part of the Indenture by
reference to the Trust Indenture Act of 1939, as amended, as in effect on the
date of the Indenture.  This Security is
subject to all such terms, and the Holder of this security is referred to the
Indenture and said Act for a statement of them. 
Capitalized terms not defined herein have the meaning ascribed to such terms
in the Indenture.


 


The Securities
are unsecured, subordinated obligations of the Company limited to $150,000,000
aggregate principal amount ($172,500,000 aggregate principal amount if the
Underwriters exercise their over-allotment option in full, except as provided
for in the Indenture).  The Indenture
does not limit other debt of the Company, secured or unsecured.


 


5.             REDEMPTION


 


Prior to January 15,
2012, the notes will not be redeemable. 
On or after January 15, 2012 and prior to the Final Maturity Date,
the Company may redeem for cash all or part of the notes if the Last Reported
Sale Price of the Company’s common stock has been at least 130% of the
Conversion Price then in effect for at least 20 Trading Days during any 30
consecutive Trading Day period prior to the date on which we provide notice of
redemption.  The Redemption Price will
equal 100% of the principal amount of the Securities being redeemed, plus
accrued and unpaid interest to but excluding the Redemption Date, except as
described below.


 


6.             PURCHASE OF
SECURITIES AT OPTION OF HOLDER UPON A FUNDAMENTAL CHANGE


 


If a
Fundamental Change occurs prior to the Final Maturity Date, at the option of
the Holder and subject to the terms and conditions of the Indenture, the
Company shall become obligated to purchase for cash, subject to certain
exceptions described in the Indenture all or any part specified by the Holder
(so long as the principal amount of such part is $1,000 or an integral multiple
of $1,000) of the Securities held by such Holder on a date specified by the
Company that is not less than 30 nor more than 45 days after the date of the
Fundamental Change Company Notice, at a purchase price equal to 100% of the
principal amount thereof together with accrued and unpaid interest, if any, to,
but excluding, the Fundamental Change Repurchase Date.  The Holder shall have the right to withdraw
any Fundamental Change Repurchase Notice (in whole or in a portion thereof that
is $1,000 or an integral multiple of $1,000) at any time prior to the close of
business on the Business Day next preceding the Fundamental Change 


 


A-5

















 


Repurchase
Date by delivering a written notice of withdrawal to the Paying Agent in
accordance with the terms of the Indenture.


 


7.             CONVERSION


 


Subject to and
upon compliance with the provisions of the Indenture, a Holder may surrender
for conversion any Security that is $1,000 principal amount or integral
multiples thereof.


 


8.             SUBORDINATION


 


To the extent
provided in the Indenture, the Securities are subordinated to Senior
Indebtedness, as defined in the Indenture, of the Company.  To the extent provided in the Indenture,
Senior Indebtedness must be paid in full before the Securities may be
paid.  The Company agrees, and each Security
holder by accepting a Security agrees, to the subordination provisions
contained in the Indenture and authorizes the Trustee to give it effect and
appoints the Trustee as attorney-in-fact for such purpose.


 


9.             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.  A Holder may register the transfer of or
exchange Securities in accordance with the Indenture.  The Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents and to
pay any taxes or other governmental charges that may be imposed in relation
thereto by law or permitted by the Indenture.


 


10.           PERSONS DEEMED OWNERS


 


The Holder of
a Security may be treated as the owner of it for all purposes.


 


11.           UNCLAIMED MONEY


 


If money for
the payment of principal or interest remains unclaimed for two years, the
Trustee and any Paying Agent will pay the money back to the Company at its
written request, subject to applicable unclaimed property law and the
provisions of the Indenture.  After that,
Holders entitled to money must look to the Company for payment as general
creditors unless an applicable abandoned property law designates another
person.


 


12.           AMENDMENT,
SUPPLEMENT AND WAIVER


 


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 an existing
Default or Event of Default and its consequence or compliance with any
provision of the Indenture or the Securities may be waived in a particular
instance with the consent of the Holders of a majority in aggregate principal 


 


A-6

















 


amount of the
Securities then outstanding.  Without the
consent of or notice to any Holder, the Company and the Trustee may amend or
supplement the Indenture or the Securities as provided in the Indenture.


 


13.           SUCCESSOR ENTITY


 


When a
successor corporation assumes all the obligations of its predecessor under the
Securities and the Indenture in accordance with the terms and conditions of the
Indenture, the predecessor corporation (except in certain circumstances
specified in the Indenture) shall be released from those obligations.


 


14.           DEFAULTS AND
REMEDIES


 


Under the
Indenture, an Event of Default shall occur if:


 


(1)           the Company shall fail to pay when
due the Principal, Redemption Price or any Fundamental Change Repurchase Price
of any Security, when the same becomes due and payable, whether or not such
payment is prohibited by the subordination provisions under the Indenture; or


 


(2)           the Company shall fail to pay an
installment of interest, on any of the Securities, which failure continues for
30 days after the date when due, whether or not such payment is prohibited by
the subordination provisions under the Indenture; or


 


(3)           the Company shall fail to deliver
when due all shares of Common Stock, including any Make-Whole Premium, if any,
and any cash deliverable upon conversion of the Securities, which failure
continues for 10 days; or


 


(4)           the Company shall fail to perform or
observe (or obtain a waiver with respect to) any other term, covenant or agreement
contained in the Securities or the Indenture for a period of 75 days after
receipt by the Company of a Notice of Default specifying such failure; or


 


(5)           the Company shall fail to pay any
principal by the end of any applicable grace period or resulting in
acceleration of other Indebtedness of the Company for borrowed money where the
aggregate principal amount with respect to which the default or acceleration
has occurred exceeds $15 million, provided that
if any such default is cured, waived, rescinded or annulled, then the Event of
Default by reason thereof would be deemed not to have occurred; or


 


(6)           the Company pursuant to or within the
meaning of any Bankruptcy Law:


 


(A)          commences as a debtor
a voluntary case or proceeding; or


 


(B)           consents to the
entry of an order for relief against it in an involuntary case or proceeding or
the commencement of any case against it;


 


A-7

















 


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


 


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


 


(E)           files a petition in
bankruptcy or answer or consent seeking reorganization or relief; or


 


(F)           consents to the
filing of such a petition or the appointment of or taking possession by a
Receiver; or


 


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


 


(A)          grants relief against
the Company in an involuntary case or proceeding or adjudicates the Company
insolvent or bankrupt;


 


(B)           appoints a Receiver
of the Company or for all or substantially all of the property of the Company;
or


 


(C)           orders the winding
up or liquidation of the Company;


 


and in each
case the order or decree remains unstayed and in effect for 60 consecutive days.  The term “Bankruptcy Law” means Title 11 of
the United States Code (or any successor thereto) or any similar federal or
state law for the relief of debtors.  The
term “Receiver” means any receiver, trustee, assignee, liquidator, sequestrator
or similar official under any Bankruptcy Law.


 


Notwithstanding
the above, no Event of Default under clauses (4) or (5) above shall
occur until the Trustee notifies the Company in writing upon the written
direction of the Holders of at least 25% in aggregate principal amount of the
Securities then outstanding, or the Holders of at least 25% in aggregate
principal amount of the Securities then outstanding notify the Company and the
Trustee in writing, of the Default (a “Notice of Default”), and the Company
does not cure the Default within the time specified in clause (4) or (5),
as applicable, after receipt of such notice.


 


If an Event of
Default (other than an Event of Default specified in clause (6) or (7) above)
occurs and is continuing with respect to the Company, the Trustee may, by
notice to the Company, and shall upon the written direction of the Holders of
at least 25% in aggregate principal amount of the Securities then outstanding,
or the Holders of at least 25% in aggregate principal amount of the Securities
then outstanding may, by notice to the Company and the Trustee, declare the
principal amount and accrued and unpaid interest, if any, through the date of
declaration on all the Securities to be immediately due and payable; provided, however, that so long as any Designated Senior
Indebtedness is outstanding, such acceleration of the Securities shall not be
effective until the earlier of (x) an acceleration of such Designated
Senior Indebtedness or (y) five (5) Business Days after receipt by
the Trustee of written notice of such 


 


A-8

















 


acceleration
of the Securities.  Upon such a
declaration, such principal amount and such accrued and unpaid interest, if
any, shall be due and payable immediately. 
If an Event of Default specified in clauses (6) or (7) occurs
in respect of the Company and is continuing, the principal amount and accrued
but unpaid interest, if any, on all the Securities shall become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holders of Securities. 
The Holders of a majority in aggregate principal amount of the
Securities then outstanding by notice to the Trustee may rescind an
acceleration and its consequences if (a) all existing Events of Default,
other than the nonpayment of the principal of the Securities which have become
due solely by such declaration of acceleration, have been cured or waived; (b) to
the extent the payment of such interest is lawful, interest (calculated at the
rate per annum borne by the Securities) on overdue installments of interest and
overdue principal, which has become due otherwise than by such declaration of
acceleration, has been paid; (c) the rescission would not conflict with
any judgment or decree of a court of competent jurisdiction; and (d) all
payments due to the Trustee and any predecessor Trustee under the Indenture
have been made.  No such rescission shall
affect any subsequent Default or impair any right consequent thereto.


 


Notwithstanding
the acceleration provision above, to the extent elected by the Company, the
sole remedy for an Event of Default relating to the failure to comply with the
reporting obligations in the indenture with respect to SEC filings that are
described under Section 6.02(a) of the Indenture, and for any failure
to comply with the requirements of Section 314(a)(1) of the Trust
Indenture Act, will for the first 180 days after the occurrence of such an
Event of Default consist exclusively of the right to receive special interest on
the Securities at an annual rate equal to 1.0% of the outstanding principal
amount of the Securities.  This special
interest will be paid semi-annually in arrears, with the first semi-annual
payment due on the first Interest Payment Date following the date on which the
special interest began to accrue on any Securities.  The special interest will accrue on all
outstanding Securities from and including the date on which an Event of Default
relating to a failure to comply with the reporting obligations hereunder first
occurs to but not including the 180th day (or earlier, if the Event of Default
relating to the reporting obligations is cured or waived prior to such 180th
day), such special interest will cease to accrue and, if the Event of Default
relating to reporting obligations has not been cured or waived prior to such
180th day, the Securities will be subject to acceleration as provided
above.  In the event the Company does not
elect to pay special interest upon an Event of Default in accordance with this
paragraph, the Securities will be subject to acceleration as provided
above.  Holders may not enforce the
Indenture or the Securities except as provided in the Indenture.  The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Securities.  Subject to certain limitations, Holders of a
majority in aggregate principal amount of the Securities then outstanding may
direct the Trustee in its exercise of any trust or power.  The Trustee may withhold from Holders notice
of any continuing Default (except a Default in payment of principal or
interest) if and so long as it determines that withholding notice is in their
interests.  The Company is required to
file periodic certificates with the Trustee as to the Company’s compliance with
the Indenture and knowledge or status of any Default.


 


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15.           TRUSTEE DEALINGS
WITH THE COMPANY


 


The Bank of
New York Trust Company, N.A., the initial Trustee under the Indenture, in its
individual or any other capacity, may make loans to, accept deposits from and
perform services for the Company or an Affiliate of the Company, and may
otherwise deal with the Company or an Affiliate of the Company, as if it were
not the Trustee.


 


16.           NO RECOURSE AGAINST
OTHERS


 


A director,
officer, employee or shareholder, as such, of the Company shall not have any
liability for any obligations of the Company under the Securities or the
Indenture nor for any claim based on, in respect of or by reason of such
obligations or their creation.  The
Holder of this Security by accepting this Security waives and releases all such
liability.  The waiver and release are
part of the consideration for the issuance of this Security.


 


17.           AUTHENTICATION


 


This Security
shall not be valid until the Trustee or an authenticating agent manually signs
the certificate of authentication on the other side of this Security.


 


18.           ABBREVIATIONS AND
DEFINITIONS


 


Customary
abbreviations may be used in the name of the Holder or an assignee, such as:
TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (=
joint tenants with right of survivorship and not as tenants in common), CUST (=
Custodian) and UGMA (= Uniform Gifts to Minors Act).


 


All terms
defined in the Indenture and used in this Security but not specifically defined
herein are defined in the Indenture and are used herein as so defined.


 


19.           INDENTURE TO
CONTROL; GOVERNING LAW


 


In the case of
any conflict between the provisions of this Security and the Indenture, the provisions
of the Indenture shall control.  This
Security and the Indenture shall be governed by, and construed in accordance
with, the laws of the State of New York.


 


The Company
will furnish to any Holder, upon written request and without charge, a copy of
the Indenture.  Requests may be made
to:  Theravance, Inc.,
901 Gateway Boulevard, South San Francisco, California 94080,
Attention:  General Counsel (Fax:  650-827-8690).


 


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ASSIGNMENT FORM


 


	
  To assign this Security, fill in the form below:

  	
   

  
	
   

  	
   

  
	
  I or we
  assign and transfer this Security to

  	
   

  



 


	
  (Insert assignee’s
  soc  sec. or tax I.D. no.):

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

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

  



 


 


	
  and
  irrevocably appoint

  	
   

  



 


 


agent to transfer this Security
on the books of the Company.  The agent
may substitute another to act for him or her.


 


	
   

  	
  Your Signature

  
	
   

  	
   

  
	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  
	
   

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

  
				



 


*Signature guaranteed by:


 


	
  By:

  	
   

  	
   

  



 






*                                         The signature
must be guaranteed by an institution which is a member of one of the following
recognized signature guaranty programs: (i) the Securities Transfer Agent
Medallion Program (STAMP); (ii) the New York Stock Exchange Medallion
Program (MSP); (iii) the Stock Exchange Medallion Program (SEMP); or (iv) such
other guaranty program acceptable to the Trustee.


 


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CONVERSION NOTICE


 


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


 


To convert
only part of this Security, state the principal amount to be converted (must be
$1,000 or a integral multiple of $1,000): $                      .


 


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


 


	
  (Insert assignee’s soc.  sec. 
  or tax I.D.  no.):

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

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

  



 


 


	
  and
  irrevocably appoint

  	
   

  



 


agent to transfer this Security
on the books of the Company.  The agent
may substitute another to act for him or her.


 


 


	
   

  	
  Your Signature

  
	
   

  	
   

  
	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  
	
   

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

  
				



 


*Signature guaranteed by:


 


	
  By:

  	
   

  	
   

  



 






*                                         The signature
must be guaranteed by an institution which is a member of one of the following
recognized signature guaranty programs: (i) the Securities Transfer Agent
Medallion Program (STAMP); (ii) the New York Stock Exchange Medallion
Program (MSP); (iii) the Stock Exchange Medallion Program (SEMP); or (iv) such
other guaranty program acceptable to the Trustee.


 


A-12

















 


FUNDAMENTAL CHANGE REPURCHASE NOTICE


 


To: Theravance, Inc.


 


The
undersigned registered owner of this Security hereby irrevocably acknowledges
receipt of a notice from Theravance, Inc. 
(the “Company”) as to the occurrence of a Fundamental Change with
respect to the Company and requests and instructs the Company to purchase the
entire principal amount of this Security, or the portion thereof (which is
$1,000 or an integral multiple thereof) below designated, in accordance with
the terms of the Security and the Indenture referred to in the Security at the
Fundamental Change Repurchase Price, together with accrued and unpaid interest,
to, but excluding, such date, to the registered Holder hereof.


 


	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
  Signature
  (s)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature(s) must be guaranteed by a
  qualified guarantor institution with membership in an approved signature
  guarantee program pursuant to Rule 17Ad-15 under the Securities Exchange
  Act of 1934.

  
	
   

  	
   

  
	
   

  	
  Signature Guaranty

  



 


Principal amount to be redeemed (in an


integral multiple of $1,000, if less than all): $                  


 


NOTICE: The signature to the
foregoing Election must correspond to the Name as written upon the face of this
Security in every particular, without any alteration or change whatsoever.


 


A-13

















 


SCHEDULE OF EXCHANGES OF SECURITIES(1)


 


The following
exchanges, purchases or conversions of a part of this Global Security have been
made:


 


	
  Principal Amount of this

  Global Note Following

  Such Decrease Date of

  Exchange (or Increase)

  	
   

  	
  Authorized Signatory

  of Securities

  Custodian

  	
   

  	
  Amount of Decrease in

  Principal Amount of this Global

  Note

  	
   

  	
  Amount of increase

  in Principal

  Amount of this

  Global Note

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 






(1)           This schedule should be included only
if the Security is a Global Security.


 


A-14