EX-10.42 Indenture



 





Exhibit 10.42




Execution Copy




TERREMARK WORLDWIDE, INC.




and




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




 






INDENTURE




Dated as of January 5, 2007




 






$4,000,000 PRINCIPAL AMOUNT




0.50% SENIOR SUBORDINATED CONVERTIBLE NOTES DUE 2009




 









 





TABLE OF CONTENTS




	 	 	 	 	 
	ARTICLE I. DEFINITIONS AND INCORPORATION BY REFERENCE
	 	 	1	 
	 
	 	 	 	 
	1.1 Definitions
	 	 	1	 
	1.2 Other Definitions
	 	 	5	 
	1.3 Incorporation by Reference of Trust Indenture Act
	 	 	5	 
	1.4 Rules of Construction
	 	 	6	 
	 
	 	 	 	 
	ARTICLE II. THE SECURITIES
	 	 	7	 
	 
	 	 	 	 
	2.1 Form and Dating
	 	 	7	 
	2.2 Execution And Authentication.
	 	 	8	 
	2.3 Registrar, Paying Agent and Conversion Agent
	 	 	8	 
	2.4 Paying Agent to Hold Money in Trust
	 	 	9	 
	2.5 Securityholder Lists
	 	 	9	 
	2.6 Transfer and Exchange
	 	 	9	 
	2.7 Replacement Securities
	 	 	10	 
	2.8 Outstanding Securities
	 	 	10	 
	2.9 Securities Held by the Company or An Affiliate
	 	 	11	 
	2.10 Temporary Securities
	 	 	11	 
	2.11 Cancellation
	 	 	12	 
	2.12 Defaulted Interest
	 	 	12	 
	2.13 CUSIP Numbers
	 	 	12	 
	2.14 Deposit of Moneys
	 	 	12	 
	2.15 Book-Entry Provisions for Global Securities
	 	 	12	 
	2.16 Special Transfer Provisions
	 	 	13	 
	2.17 Restrictive Legends
	 	 	15	 
	 
	 	 	 	 
	ARTICLE III. REDEMPTION; REPURCHASE
	 	 	15	 
	 
	 	 	 	 
	3.1 Right of Redemption, Repurchase
	 	 	15	 
	3.2 Notices to Trustee
	 	 	16	 
	3.3 Securities to be Redeemed
	 	 	16	 
	3.4 Notice of Redemption
	 	 	16	 
	3.5 Effect of Notice of Redemption
	 	 	17	 
	3.6 Deposit of Redemption Price
	 	 	18	 
	3.7 Intentionally Omitted
	 	 	18	 
	3.8 Repurchase at Option of Holder Upon a Change in Control
	 	 	18	 
	 
	 	 	 	 
	ARTICLE IV. COVENANTS
	 	 	23	 
	 
	 	 	 	 
	4.1 Payment of Securities
	 	 	23	 
	4.2 Maintenance of Office or Agency
	 	 	24	 
	4.3 Rule 144A Information and Annual Reports
	 	 	24	 
	4.4 Compliance Certificate; Statement by Officers as to Default
	 	 	25	 
	4.5 Stay, Extension and Usury Laws
	 	 	25	 
	4.6 Corporate Existence
	 	 	25	 






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	4.7 Notice of Default
	 	 	26	 
	4.8 Further Instruments and Acts
	 	 	26	 
	 
	 	 	 	 
	ARTICLE V. SUCCESSORS
	 	 	26	 
	 
	 	 	 	 
	5.1 When Company May Merge, Etc.
	 	 	26	 
	5.2 Successor Substituted
	 	 	26	 
	 
	 	 	 	 
	ARTICLE VI. DEFAULTS AND REMEDIES
	 	 	27	 
	 
	 	 	 	 
	6.1 Events of Default
	 	 	27	 
	6.2 Acceleration
	 	 	28	 
	6.3 Other Remedies
	 	 	29	 
	6.4 Waiver of Past Defaults
	 	 	29	 
	6.5 Control by Majority
	 	 	29	 
	6.6 Limitation on Suits
	 	 	30	 
	6.7 Rights of Holders to Receive Payment
	 	 	30	 
	6.8 Collection Suit by Trustee
	 	 	30	 
	6.9 Trustee May File Proofs of Claim
	 	 	31	 
	6.10 Priorities
	 	 	31	 
	6.11 Undertaking For Costs
	 	 	31	 
	 
	 	 	 	 
	ARTICLE VII. TRUSTEE
	 	 	32	 
	 
	 	 	 	 
	7.1 Duties of Trustee
	 	 	32	 
	7.2 Rights of Trustee
	 	 	33	 
	7.3 Individual Rights of Trustee
	 	 	34	 
	7.4 Trustee’s Disclaimer
	 	 	34	 
	7.5 Notice of Defaults
	 	 	34	 
	7.6 Reports by Trustee to Holder of the Securities
	 	 	35	 
	7.7 Compensation, Reimbursement and Indemnity
	 	 	35	 
	7.8 Replacement of Trustee
	 	 	36	 
	7.9 Successor Trustee by Merger, Etc.
	 	 	37	 
	7.10 Eligibility; Disqualification
	 	 	37	 
	7.11 Preferential Collection of Claims Against Company
	 	 	38	 
	 
	 	 	 	 
	ARTICLE VIII. DISCHARGE OF INDENTURE
	 	 	38	 
	 
	 	 	 	 
	8.1 Termination of the Obligations of the Company
	 	 	38	 
	8.2 Application of Trust Money
	 	 	38	 
	8.3 Repayment to Company
	 	 	38	 
	8.4 Reinstatement
	 	 	39	 
	 
	 	 	 	 
	ARTICLE IX. AMENDMENTS
	 	 	39	 
	 
	 	 	 	 
	9.1 Without Consent of Holders
	 	 	39	 
	9.2 With Consent of Holders
	 	 	40	 
	9.3 Compliance with Trust Indenture Act
	 	 	41	 






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	9.4 Revocation and Effect of Consents
	 	 	41	 
	9.5 Notation on or Exchange of Securities
	 	 	41	 
	9.6 Trustee Protected
	 	 	42	 
	 
	 	 	 	 
	ARTICLE X. CONVERSION
	 	 	42	 
	 
	 	 	 	 
	10.1 Conversion Privilege; Restrictive Legends
	 	 	42	 
	10.2 INTENTIONALLY OMITTED
	 	 	43	 
	10.3 Conversion Procedure.
	 	 	43	 
	10.4 Fractional Shares
	 	 	44	 
	10.5 Taxes on Conversion
	 	 	44	 
	10.6 Company to Provide Stock
	 	 	44	 
	10.7 Adjustment of Conversion Price
	 	 	44	 
	10.8 No Adjustment
	 	 	47	 
	10.9 Adjustments For Tax Purposes
	 	 	48	 
	10.10 Notice of Adjustment
	 	 	48	 
	10.11 Notice of Certain Transactions
	 	 	48	 
	10.12 Effect of Reclassifications, Consolidations, Mergers,
Binding Share Exchanges or Sales on Conversion Privilege
	 	 	49	 
	10.13 Trustee’s Disclaimer
	 	 	50	 
	 
	 	 	 	 
	ARTICLE XI. SUBORDINATION
	 	 	50	 
	 
	 	 	 	 
	ARTICLE XII. MISCELLANEOUS
	 	 	50	 
	 
	 	 	 	 
	12.1 Trust Indenture Act Controls
	 	 	50	 
	12.2 Notices
	 	 	50	 
	12.3 Communication by Holders with Other Holders.
	 	 	51	 
	12.4 Certificate and Opinion as to Conditions Precedent.
	 	 	51	 
	12.5 Statements Required in Certificate or Opinion
	 	 	52	 
	12.6 Rules by Trustee and Agents
	 	 	52	 
	12.7 Legal Holidays
	 	 	52	 
	12.8 Duplicate Originals
	 	 	52	 
	12.9 Governing Law
	 	 	52	 
	12.10 No Adverse Interpretation of Other Agreements
	 	 	53	 
	12.11 Successors
	 	 	53	 
	12.12 Separability
	 	 	53	 
	12.13 Table of Contents, Headings, Etc.
	 	 	53	 
	12.14 Calculations in Respect of The Securities
	 	 	53	 
	12.15 Force Majeure
	 	 	53	 
	12.16 Waiver of Jury Trial
	 	 	53	 
	 
	 	 	 	 
	Exhibit A – Form of Global Security
	 	 	 	 
	 
	 	 	 	 
	Exhibit B-1  —  Form of Private Placement Legend
	 	 	 	 
	 
	 	 	 	 
	Exhibit B-2  —  Form of Legend for Global Security
	 	 	 	 






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	Exhibit B-3  —  Form of Legend Regarding Registration Rights Agreement
	 	 	 	 
	 
	 	 	 	 
	Exhibit C  —  Form of Notice of Transfer Pursuant to Registration Statement
	 	 	 	 
	 
	 	 	 	 
	Exhibit D  —  Form of Certificate
	 	 	 	 






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     INDENTURE, dated as of January 5, 2007, between Terremark Worldwide, Inc., a Delaware
corporation (the “Company”), and The Bank of New York Trust Company, N.A., a national
banking association, as trustee (the “Trustee”).



     Each party agrees as follows for the benefit of the other party and for the equal and ratable
benefit of the Holders of the Company’s 0.50% Senior Subordinated Convertible Notes due 2009 (the
“Securities” or the “Notes”).



ARTICLE I.

DEFINITIONS AND INCORPORATION BY REFERENCE




     1.1 Definitions.



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




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




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




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




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




          “Common Stock” means the common stock, $0.001 par value per share, of the Company, or
such other Capital Stock of the Company into which the Company’s common stock is reclassified or
changed.




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




 









 








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




          “Conversion Price” means $8.14, subject to adjustment as provided in Article
X.




          “Corporate Trust Office” means the office of the Trustee at which at any time its
corporate trust business shall be administered, which office at the dated hereof is located at
10161 Centurion Parkway, Jacksonville, Florida 32256, Attention: Corporate Trust Administration,
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 any event which is, or after notice or passage of time or both would
be, an Event of Default.




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




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




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




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

2









 








extensions, refundings, deferrals, restructurings, amendments and modifications of any
indebtedness, obligation, guarantee or liability of the kind described in clauses (a) through (g).




          “Indenture” means this Indenture as amended or supplemented from time to time.




          “Initial Purchaser” means Credit Suisse International.




          “Interest” means an amount per annum equal to 0.50% for the first 24 months that
Securities are outstanding, and thereafter at a rate of 1.50% per annum until maturity.




          “Issue Date” means January 5, 2007.




          “Lien” means any lien, mortgage, deed of trust, pledge, security interest, charge or
encumbrance of any kind.




          “Maturity Date” means June 30, 2009.




          “Note Register” a register maintained by the Company for the registration or transfer
of the Securities.




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




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




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




          “Permitted Holder” means (i) Manuel D. Medina, (ii) Francis Lee and (iii) any
“controlled” (as such term is defined in the definition of Affiliate) Affiliate of Manuel D. Medina
and/or Francis Lee.




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




          “Purchase Agreement” means the Purchase Agreement dated January 5, 2007 between the
Company and the Initial Purchaser.




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




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




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




3









 








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




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




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




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




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




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




          “SEC” means the Securities and Exchange Commission.




          “Securities” means the 0.50% Senior Subordinated Convertible Notes due 2009 issued by
the Company pursuant to this Indenture.




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




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




          “Subsidiary” means (i) a corporation a majority of whose Capital Stock with voting
power, under ordinary circumstances, to elect directors is at the time, directly or indirectly,
owned by the Company, by one or more subsidiaries of the Company or by the Company and one or more
of its subsidiaries or (ii) any other person (other than a corporation) in which the Company, one
or more its subsidiaries or the Company and one or more its subsidiaries, directly or indirectly,
at the date of determination thereof, have at least majority ownership interest.




          “TIA” means the Trust Indenture Act of 1939, as amended and in effect from time to
time.




          “Trading Day” means a day during which trading in securities generally occurs on the
principal national or regional securities exchange in the United States on which the Common

4









 








Stock
is then listed or, if the Common Stock is not listed on a national or regional securities exchange
in the United States, on the National Association of Securities Dealers Automated Quotation System
or, if the Common Stock is not quoted on the National Association of Securities Dealers Automated
Quotation System, on the principal other market on which the Common Stock is then traded.




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




          “Voting Stock” of any Person means the total voting power of all classes of the
Capital Stock of such Person entitled to vote generally in the election of directors of such
Person.




     1.2 Other Definitions.



	 	 	 	 	 
	TERM
	 	DEFINED IN SECTION
	“Bankruptcy Law”
	 	 	6.1	 
	“Business Day”
	 	 	12.7	 
	“Change in Control Notice”
	 	 	3.8	 
	“Conversion Agent”
	 	 	2.3	 
	“Conversion Date”
	 	 	10.3	 
	“Custodian”
	 	 	6.1	 
	“Determination Date”
	 	 	10.7	 
	“Event of Default”
	 	 	6.1	 
	“Global Security”
	 	 	2.1	 
	“Legal Holiday”
	 	 	12.7	 
	“Participants”
	 	 	2.15	 
	“Paying Agent”
	 	 	2.3	 
	“Physical Securities”
	 	 	2.1	 
	“Private Placement Legend”
	 	 	2.17	 
	“Redemption”
	 	 	3.1	 
	“Redemption Payment”
	 	 	3.1	 
	“Redemption Price”
	 	 	3.1	 
	“Registrar”
	 	 	2.3	 
	“Repurchase Upon a Change in Control”
	 	 	3.1	 
	“Repurchase Date”
	 	 	3.8	 
	“Repurchase Price”
	 	 	3.8	 
	“Repurchase Right”
	 	 	3.8	 
	“Resale Restriction Termination Date”
	 	 	2.17	 






     1.3 Incorporation by Reference of Trust Indenture Act.



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




          “Commission” means the SEC;




          “Indenture Securities” means the Securities;

5









 









          “Indenture Security Holder” means a Securityholder or a Holder;




          “Indenture to be Qualified” means this Indenture;




          “Indenture Trustee” or “Institutional Trustee” means the Trustee; and




          “Obligor” on the Indenture Securities means the Company (or any successor).




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



     1.4 Rules of Construction.



          Unless the context otherwise requires:





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




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




     (iii) “or” is not exclusive;




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




     (v) provisions apply to successive events and transactions;




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




     (vii) references to currency shall mean the lawful currency of the United States of
America, unless the context requires otherwise.



     1.5 Acts of Holders. Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by Holders may be embodied
in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in
person or by an agent duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments are delivered to
the Trustee and, where it is hereby expressly required, to the Company. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred
to as the “Act” of Holders signing such instrument or instruments. Proof of execution of
any such instrument or of a writing appointing any such agent shall be sufficient for any purpose
of this Indenture and (subject to Section 7.1) conclusive in favor of the Trustee and the Company,
if made in the manner provided in this Section.



6









 





          The fact and date of the execution by any Person of any such instrument or writing may be
proved by the affidavit of a witness of such execution or by the certificate of any notary public
or other officer authorized by law to take acknowledgments of deeds, certifying that the individual
signing such instrument or writing acknowledged to him or her the execution thereof. Where such
execution is by an officer of a corporation or a member of a partnership, on behalf of such
corporation or partnership, such certificate or affidavit shall also constitute sufficient proof of
his or her authority. The fact and date of the execution of any such instrument or writing, or the
authority of the Person executing the same, may also be proved in any other manner which the
Trustee deems sufficient.




          The ownership of Securities shall be proved by the register maintained by the Registrar.




          Any request, demand, authorization, direction, notice, consent, waiver or other Act of the
Holder of any Security shall bind every future Holder of the same Security and the Holder of every
Security issued upon the registration of transfer thereof or in exchange therefor or in lieu
thereof in respect of anything done or suffered to be done by the Trustee or the Company in
reliance thereon, whether or not notation of such action is made upon such Security.




          If the Company shall solicit from the Holders any request, demand, authorization, direction,
notice, consent, waiver or other Act, the Company may, at its option, by or pursuant to a Board
Resolution, fix in advance a record date for the determination of Holders entitled to give such
request, demand, authorization, direction, notice, consent, waiver or other Act, but the Company
shall have no obligation to do so. If such a record date is fixed, such request, demand,
authorization, direction, notice, consent, waiver or other Act may be given before or after such
record date, but only the Holders of record at the close of business on such record date shall be
deemed to be Holders for the purposes of determining whether Holders of the requisite proportion of
outstanding Securities have authorized or agreed or consented to such request, demand,
authorization, direction, notice, consent, waiver or other Act, and for that purpose the
outstanding Securities shall be computed as of such record date; provided that no such
authorization, agreement or consent by the Holders on such record date shall be deemed effective
unless it shall become effective pursuant to the provisions of this Indenture not later than six
months after the record date.




ARTICLE II.

THE SECURITIES




     2.1 Form and Dating.



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




          Securities offered and sold in reliance on Rule 144A shall be issued either (a) in definitive
form or (b) in the form of one or more Global Securities, substantially in the form set

7









 








forth in
Exhibit A (the “Global Security”), deposited with the Trustee, as custodian for the
Depositary, duly executed by the Company and authenticated by the Trustee as hereinafter provided
and bearing the legends set forth in Exhibits B-1 and B-2. The aggregate principal
amount of the Global Security may from time to time be increased or decreased by adjustments made
on the records of the Trustee, as custodian for the Depositary, as hereinafter provided; provided,
that in no event shall the aggregate principal amount of the Global Security or Securities exceed
$4,000,000.




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



          The Securities shall bear the legends set forth in Exhibit B-3.




     2.2 Execution And Authentication.



          One Officer shall sign the Securities for the Company by manual or facsimile signature. If an
Officer whose signature is on a Security no longer holds that office at the time the Security is
authenticated, the Security shall nevertheless be valid. A Security shall not be valid until
authenticated by the manual signature of the Trustee. The signature shall be conclusive evidence
that the Security has been authenticated under this Indenture. Upon the Trustee’s receipt of a
Company Order and the other documents required by Section 12.4 and 12.5 hereof, the Trustee shall
authenticate Securities for original issue in the aggregate principal amount of $4,000,000 and such
additional principal amount, if any, as shall be determined pursuant to the next sentence of this
Section 2.2. The aggregate principal amount of Securities outstanding at any time may not
exceed $4,000,000 except as provided in this Section 2.2.




     The Trustee shall act as the initial authenticating agent. Thereafter, the Trustee may
appoint an authenticating agent reasonably 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 authenticating
agent. An authenticating agent has the same rights as a Security Agent to deal with the Company
and its Affiliates.



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



     2.3 Registrar, Paying Agent and Conversion Agent.



          The Company shall maintain an office or agency where Securities may be presented for
registration of transfer or for exchange (“Registrar”), an office or agency where
Securities may be presented for payment (“Paying Agent”) and an office or agency where
Securities may be presented for conversion (“Conversion Agent”). The Registrar shall keep
a register of the Securities and of their transfer and exchange. The Company may appoint or change
one or more co-registrars, one or more additional paying agents and one or more additional
conversion agents without notice and may act in any such capacity on its own behalf.

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The term
“Registrar” includes any co-Registrar; the term “Paying Agent” includes any additional paying
agent; and the term “Conversion Agent” includes any additional conversion agent.




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



     The Company initially appoints the Trustee as Paying Agent, Registrar and Conversion Agent.
The Securities may be presented for the registration or transfer and exchange at the offices of the
Register which initially will be the Corporate Trust Office of the Trustee.



     2.4 Paying Agent to Hold Money in Trust.



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




     2.5 Securityholder Lists.



          The Trustee shall preserve in as current a form as is reasonably practicable the most recent
list available to it of the names and addresses of Securityholders. If the Trustee is not the
Registrar, the Company shall furnish to the Trustee on or before each July 1 and January 1 (of if
such date is not a Business Day, the immediately succeeding Business Day, such dates,
the “Interest Payment Date”) and at such other times as the Trustee may request in
writing a list, in such form and as of such date as the Trustee may reasonably require, of the
names and addresses of Securityholders as set forth in the Note Register.




     2.6 Transfer and Exchange.



          Subject to Sections 2.15 and 2.16 hereof, when Securities are presented to the
Registrar with a request to register their transfer or to exchange them for an equal principal
amount of Securities of other authorized denominations, the Registrar shall register the transfer
or make the exchange if its requirements for such transaction are met. The Company shall execute
and the Trustee shall authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Securities of any authorized denomination and of a like aggregate
principal amount and bearing such restricted legends as may be required by this Indenture.
Securities may be exchanged for other Securities of any authorized denominations and of a like
aggregate principal amount, upon surrender of the Securities to be exchanged at any such office or
agency maintained by the Registrar pursuant to Section 2.3. Whenever any Securities are so
surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange is entitled to receive bearing

9









 








registration numbers not contemporaneously outstanding. All Securities presented or surrendered
for registration of transfer or exchange shall be duly endorsed, or be accompanied by a written
instrument or instruments of transfer in form satisfactory to the Company and the Registrar, and
the Securities shall be duly executed by the Holder thereof or his attorney duly authorized in
writing. The Company, the Trustee and the Registrar shall not be required to register the transfer
of or exchange any Security (i) during a period beginning at the opening of business fifteen (15)
days before the mailing of a notice of redemption of the Securities selected for Redemption under
Section 3.4 and ending at the close of business on the day of such mailing or (ii) that has
been selected for repurchase or for which a Purchase Notice has been delivered, and not withdrawn,
in accordance with this Indenture, except the unredeemed or unrepurchased portion of Securities
being redeemed or repurchased in part.




     No service charge shall be made for any transfer, exchange or conversion of Securities, but
the Company may require payment of a sum sufficient to cover any transfer tax or similar
governmental charge that may be imposed in connection with any transfer, exchange or conversion of
Securities, other than exchanges pursuant to Sections 2.10, 9.5 or 10.3, or
Article III, not involving any transfer.



     2.7 Replacement Securities.



          If the Holder of a Security claims that the Security has been mutilated, lost, destroyed or
wrongfully taken, the Company shall issue and the Trustee upon receipt of a Company Order in
accordance with Section 2.2 shall authenticate a replacement Security upon surrender to the Trustee
of the mutilated Security, or upon delivery to the Trustee of evidence of the loss, destruction or
theft of the Security satisfactory to the Trustee and the Company. In the
case of lost, destroyed or wrongfully taken Securities, an indemnity bond must be provided by
the Holder that is reasonably satisfactory to the Trustee and the Company to protect the Company,
the Trustee or any Security Agent from any loss which any of them may suffer if a Security is
replaced. The Trustee may charge for its expenses in replacing a Security.




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




          Every replacement Security is an additional obligation of the Company only as provided in
Section 2.8.




     2.8 Outstanding Securities.



          Securities outstanding at any time are all the Securities authenticated by the Trustee except
for those converted, those cancelled by it, those delivered to it for cancellation, those paid
pursuant to Section 2.7 and those described in this Section 2.8 as not outstanding.
Except to the extent provided in Section 2.9, a Security does not cease to be outstanding
because the Company or one of its Subsidiaries or Affiliates holds the Security.




     If a Security is replaced pursuant to Section 2.7, it ceases to be outstanding unless
the Trustee receives proof satisfactory to it, or a court holds, that the replaced Security is held
by a protected purchaser.



10









 





     If the Paying Agent (other than the Company) holds on a Redemption Date, Repurchase Date or
Maturity Date, money (and, if applicable as provided herein and in accordance herewith, shares of
Common Stock) sufficient to pay the aggregate Redemption Price, Repurchase Price or principal
amount, as the case may be, with respect to all Securities to be redeemed, purchased or paid upon
Redemption, Repurchase Upon Change in Control or maturity, as the case may be, in each case plus,
if applicable, accrued and unpaid interest, if any, payable as herein provided upon Redemption,
Repurchase Upon Change in Control or maturity, then (unless there shall be a Default in the payment
of such aggregate Redemption Price, Repurchase Price or principal amount, or of such accrued and
unpaid interest, interest on such Securities shall cease to accrue, and such Securities shall be
deemed paid whether or not such Securities are delivered to the Paying Agent.



     Thereafter, all rights of the Holders of such Securities shall terminate with respect to such
Securities, other than the right to receive the Redemption Price, Repurchase Price or principal
amount, as the case may be, plus, if applicable, such accrued and unpaid interest, in accordance
with this Indenture.



     If a Security is converted in accordance with Article X, then, from and after the time
of such conversion on the Conversion Date, such Security shall cease to be outstanding, and
interest, if any, shall cease to accrue on such Security; provided, however, that nothing in this
paragraph shall affect the provision in the Registration Rights Agreement for additional interest
on shares of Common Stock issued upon conversion of such Security.



     2.9 Securities Held by the Company or An Affiliate.



          In determining whether the Holders of the required aggregate principal amount of Securities
have concurred in any direction, waiver or consent, Securities owned by the Company or any of its
Subsidiaries or Affiliates shall be considered as though not outstanding, except that, for the
purposes of determining whether a Responsible Officer of the Trustee shall be protected in relying
on any such direction, waiver or consent, only Securities which a Responsible Officer of the
Trustee actually knows are so owned shall be so disregarded. Securities so owned which have been
pledged in good faith may be considered to be outstanding for purposes of this Section 2.9
if the pledgee establishes, to the satisfaction of the Trustee, the pledgee’s right so to concur
with respect to such Securities and that the pledgee is not, and is not acting at the direction or
on behalf of, the Company, any other obligor on the Securities, an Affiliate of the Company or any
such other obligor. In the event of a dispute as to whether the pledgee has established the
foregoing, the Trustee may conclusively rely on the advice of counsel of its selection or on an
Officers’ Certificate.




     2.10 Temporary Securities.



          Until definitive Securities are ready for delivery, the Company may prepare and, upon receipt
of a Company Order in accordance with Section 2.2, the Trustee shall authenticate temporary
Securities. Temporary Securities shall be substantially in the form of definitive Securities but
may have variations that the Company considers appropriate for temporary Securities and as shall be
reasonably acceptable to the Trustee. Without unreasonable delay, the



11









 







Company shall prepare and
the Trustee shall, as soon as practicable upon its receipt of a Company Order, authenticate
definitive Securities in exchange for such temporary Securities.




     2.11 Cancellation.



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




     2.12 Defaulted Interest.



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




     2.13 CUSIP Numbers.



          The Company in issuing the Securities may use one or more “CUSIP” numbers, and, if so, the
Trustee shall use the CUSIP numbers in notices of redemption or exchange as a convenience to
Holders; provided, however, that no representation is hereby deemed to be made by the Trustee as to
the correctness or accuracy of the CUSIP numbers printed on the notice or on the Securities;
provided further, that reliance may be placed only on the other identification numbers printed on
the Securities, and the effectiveness of any such notice shall not be affected by any defect in, or
omission of, such CUSIP numbers. The Company shall promptly notify the Trustee in writing of any
change in the CUSIP numbers.




     2.14 Deposit of Moneys.



          Prior to 10:00 A.M., New York City time, on each interest payment date, Maturity Date,
Redemption Date, or Repurchase Date, the Company shall deposit with a Paying Agent (or, if the
Company is acting as its own Paying Agent, segregate and hold in trust in accordance with
Section 2.4) money, in funds immediately available on such date, (and, if applicable as
provided herein and in accordance herewith, shares of Common Stock) sufficient to make cash
payments, if any, due on such interest payment date, Maturity Date, Redemption Date, or Repurchase
Date, as the case may be, in a timely manner which permits the Paying Agent to remit payment to the
Holders on such interest payment date, Maturity Date, Redemption Date or Repurchase Date, as the
case may be.





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     2.15 Book-Entry Provisions for Global Securities.



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




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



          (b) Transfers of Global Securities shall be limited to transfers in whole, but not in part, to
the Depositary, its successors or their respective nominees. In addition, Physical Securities
shall be transferred to all beneficial owners, as identified by the Depositary, in exchange for
their beneficial interests in Global Securities only if (i) the Depositary notifies the Company
that the Depositary is unwilling or unable to continue as depositary for any Global Security (or
the Depositary ceases to be a “clearing agency” registered under Section 17A of the Exchange Act)
and a successor Depositary is not appointed by the Company within ninety (90) days of such notice
or cessation or (ii) an Event of Default has occurred and is continuing and the Registrar has
received a written request from the Depositary to issue Physical Securities.




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




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




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




     2.16 Special Transfer Provisions.



          (a) Restrictions on Transfer and Exchange of Global Securities. Notwithstanding any
other provisions of this Indenture, but except as provided in Section 2.15(b), a Global
Security may not be transferred except as a whole by the Depositary to a nominee of the Depositary
or by a nominee of the Depositary to the Depositary or another


13









 







nominee of the Depositary or by the
Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary.




          (b) Private Placement Legend. Upon the transfer, exchange or replacement of
Securities not bearing the Private Placement Legend, the Registrar or co-registrar shall deliver
Securities that do not bear the Private Placement Legend. Upon the transfer, exchange or
replacement of Securities bearing the Private Placement Legend, the Registrar or co-Registrar shall
deliver only Securities that bear the Private Placement Legend unless (i) the requested transfer is
after the Resale Restriction Termination Date, (ii) there is delivered to the Trustee and the
Company an Opinion of Counsel reasonably satisfactory to the Trustee and the Company and
addressed to the Trustee and the Company to the effect that neither such legend nor the
related restrictions on transfer are required in order to maintain compliance with the provisions
of the Securities Act or (iii) such Security has been sold pursuant to an effective Registration
Statement under the Securities Act and the Holder that sold such Securities has delivered to the
Registrar or co-Registrar a notice in the form of Exhibit C hereto. Upon the
effectiveness, under the Securities Act, of a Registration Statement, the Company shall deliver to
the Trustee a notice of effectiveness, a Global Security or Global Securities, which do not bear
the Private Placement Legend, a Company Order in accordance with Section 2.2 and an Opinion
of Counsel in a form reasonably satisfactory to the Trustee, and, if required by the Depositary,
the Company shall deliver to the Depositary a letter of representations in a form reasonably
acceptable to the Depositary. Upon the effectiveness of any post-effective amendment to the
Registration Statement and upon the effectiveness, under the Securities Act, of any subsequent
Registration Statement, the Company shall deliver to the Trustee a notice of effectiveness and an
Opinion of Counsel in a form reasonably satisfactory to the Trustee. Upon any sale, pursuant to a
Registration Statement, of a beneficial interest in a Global Security that theretofore constituted
a Restricted Security and delivery of evidence thereof acceptable to the Trustee, and upon any sale
or transfer of a beneficial interest in connection with which the Private Placement Legend will be
removed in accordance with this Indenture, the Trustee shall increase the principal amount of the
Global Security that does not constitute a Restricted Security by the principal amount of such sale
or transfer and likewise reduce the principal amount of the Global Security that does constitute a
Restricted Security.




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




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



     Each Holder of a Security agrees to indemnify 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.



14









 





     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
Participants or 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.



     Neither the Trustee nor any Security Agent shall have any responsibility for any actions taken
or not taken by the Depositary.



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




     2.17 Restrictive Legends.



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




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



ARTICLE III.

REDEMPTION; REPURCHASE




     3.1 Right of Redemption, Repurchase.



          (a) Redemption or repurchase of the Securities, as permitted by any provision of this
Indenture, shall be made (i) with respect to a Redemption at the Company’s option, in accordance
with PARAGRAPH 6 of the Securities and (ii) with respect to a repurchase at the Holder’s option, in
accordance with PARAGRAPH 8 of the Securities (a “Repurchase At Holder’s Option Upon A Change
In Control”), in each case in accordance with the applicable provisions of this Article
III.



15









 








          (b) The Company will comply with all federal and state securities laws, and the applicable
laws of any foreign jurisdiction, in connection with any offer to sell or solicitations of offers
to buy Securities pursuant to this Article III.




          (c) The Company shall have the right, at the Company’s option, on any Interest Payment Date
that is six months following the date of this Indenture, upon no less than fifteen (15) days prior
written notice to the Trustee and the Initial Purchaser, to redeem (the “Redemption”) all
of the Securities at a redemption price equal to (i) the amount set forth below (expressed as
percentages of the principal amount outstanding on the date of redemption), plus (ii) the amount
(if any) by which the fair market value of on such date of the Common Stock into which the Security
is then convertible exceeds the principal amount of the Security on such date, plus (iii) accrued,
but unpaid Interest (the “Redemption Payment” or “Redemption Price”), if redeemed
during the following monthly periods following the closing date:




	 	 	 	 	 
	Monthly Period	 	Percentage
	After Month Six and Before Month Twelve
	 	 	113.00	%
	On or After Month Twelve and Before Month Eighteen 
	 	 	112.40	%
	On or After Month Eighteen and Before Month Twenty Four
	 	 	111.30	%
	On or After Month Twenty Four
	 	 	108.80	%






     3.2  Notices to Trustee.



          If the Company elects to redeem Securities pursuant to Paragraph 6 of the Securities, it shall
notify the Trustee in writing at least fifteen (15) days prior to the mailing, in accordance with
Section 3.4, of the Redemption (unless a shorter notice period shall be satisfactory to the
Trustee), the Redemption Date, the applicable provision of this Indenture pursuant to which the
Redemption is to be made and the aggregate principal amount of Securities to be redeemed.




     3.3 Securities to be Redeemed.



     The Company, the Trustee and the Registrar need not register the transfer of or exchange of
any Securities that have been selected for Redemption, except the unredeemed portion of Securities
being redeemed in part. The Company, the Trustee and the Registrar need not issue, authenticate,
register the transfer of or exchange any Security for a period of fifteen (15) days before the
mailing of a notice of Redemption, pursuant to this Article III, of Securities to be
redeemed.



     3.4 Notice of Redemption.



          At least twenty (20) days but not more than sixty (60) days before a Redemption Date, the
Company shall mail, or cause to be mailed, a notice of Redemption to the Initial Purchaser and each
Holder whose Securities are to be redeemed, at the address of such Holder appearing in the Note
Register.




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



16








 






          (i) the Redemption Date;




          (ii) the Redemption Payment;




          (iii) the Conversion Price;




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




          (v) that the right to convert the Securities called for Redemption will terminate at
the close of business on the Redemption Date, unless there shall be a Default in the payment
of the Redemption Payment;




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




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




          (viii) that Securities called for Redemption must be surrendered to the Paying Agent to
collect the Redemption Payment;




          (ix) that, unless there shall be a Default in the payment of the Redemption Payment,
interest on Securities called for Redemption ceases to accrue on and after the Redemption
Date, such Securities will cease to be convertible after the close of business on the
Redemption Date, and all rights of the Holders of such Securities shall terminate on and
after the Redemption Date, other than the right to receive, upon surrender of such
Securities and in accordance with the Indenture, the Redemption Payment; and




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



     The right, pursuant to Article X, to convert Securities called for Redemption shall
terminate at the close of business on the Redemption Date, unless there shall be a Default in the
payment of the Redemption Payment.



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



     3.5 Effect of Notice of Redemption.



          Once notice of Redemption is mailed, Securities called for Redemption become due and payable
on the Redemption Date at the Redemption Payment, and, on and after such Redemption Date (unless
there shall be a Default in the payment of the Redemption Payment Amount), such Securities shall
cease to bear interest, and all rights of the Holders of such Securities shall terminate, other
than the right to receive, upon surrender of such Securities and



17









 







in accordance with the next
sentence, the Redemption Payment. Upon surrender to the Paying Agent of a Security subject to
Redemption, such Security shall be paid, to the Holder surrendering such Security, at the
Redemption Payment. If the Redemption Date is an interest payment date, the Company shall pay, on
such Redemption Date, the accrued and unpaid interest, if any, to, but excluding, the Redemption
Date to the Holder of record of such Security at the close of business on the record date for such
interest payment, and such accrued and unpaid interest shall not be paid to the Holder submitting
such Security for Redemption (unless such Holder was the Holder of record of such Security at the
close of business on the record date for such interest payment).




     If any Security shall not be fully and duly paid upon surrender thereof for Redemption, the
principal of, and accrued and unpaid interest on, such Security shall, until paid, bear interest
from the Redemption Date at the rate borne by such Security on the principal amount of such
Security, and such Security shall continue to be convertible pursuant to Article X.



     Notwithstanding anything herein to the contrary, there shall be no purchase of any Securities
pursuant to a Redemption if there has occurred (prior to, on or after, as the case may be, the
mailing of the notice of Redemption specified in Section 3.4) and is continuing an Event of
Default (other than a Default in the payment of the Redemption Payment). The Paying Agent will
promptly return to the respective Holders thereof any Securities held by it during the continuance
of such an Event of Default.



     3.6 Deposit of Redemption Price.



          Prior to 10:00 A.M., New York City time on the Redemption Date, the Company shall deposit with
a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust
in accordance with Section 2.4) money, in funds immediately available on the Redemption
Date, and, if applicable as provided herein and in accordance herewith, shares of Common Stock,
sufficient to pay the Redemption Payment. The Paying Agent shall return to the Company, as soon as
practicable, any money not required for that purpose.




     3.7 Intentionally Omitted.



     3.8 Repurchase at Option of Holder Upon a Change in Control.



          (a) In the event any Change in Control (as defined below) shall occur, each Holder of
Securities shall have the right (the “Repurchase Right”), at the Holder’s option, to
require the Company to repurchase all of such Holder’s Securities (or portions thereof that are
integral multiples of $1,000 in principal amount), on a date selected by the Company (the
“Repurchase Date”), which Repurchase Date shall be no later than forty five (45) days after
the date of the Change in Control (as defined below), at a price, payable in cash, equal to one
hundred percent (100%) of the principal amount of the Securities (or portions thereof) to be so
repurchased (the “Repurchase Price”), plus accrued and unpaid interest, if any, to, and
including, the Repurchase Date, upon:





          (i) delivery to the Company (if it is acting as its own Paying Agent), or to a Paying
Agent designated by the Company for such purpose in the Change in



18









 






Control Notice (as defined
below), no later than the close of business on the Business Day immediately preceding the
Repurchase Date, of a Purchase Notice, in the form set forth in the Securities or any other
form of written notice substantially similar thereto, in each case, duly completed and
signed, with appropriate signature guarantee, stating:




          (a) the certificate number(s) of the Securities which the Holder will deliver
to be repurchased;




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




          (c) that such principal amount of Securities are to be repurchased pursuant to
the terms and conditions specified in Paragraph 8 of the Securities and in this
Indenture; and




          (ii) delivery to the Company (if it is acting as its own Paying Agent), or to a Paying
Agent designated by the Company for such purpose in the Change in Control Notice, at any
time after the delivery of such Purchase Notice, of such Securities (together with all
necessary endorsements) with respect to which the Repurchase Right is being exercised, such
delivery being a condition to receipt by the Holder of the Repurchase Price therefor plus
accrued and unpaid interest, if any, payable as herein provided upon Repurchase Upon Change
in Control.



     If such Securities are held in book-entry form through the Depositary, the Purchase Notice
shall comply with applicable procedures of the Depositary.



     Upon such delivery of Securities to the Company (if it is acting as its own Paying Agent) or
such Paying Agent, such Holder shall be entitled to receive from the Company or such Paying Agent,
as the case may be, a nontransferable receipt of deposit evidencing such delivery.



     Notwithstanding anything herein to the contrary, any Holder delivering the Purchase Notice
contemplated by this Section 3.8(a) to the Company (if it is acting as its own Paying
Agent) or to a Paying Agent designated by the Company for such purpose in the Change in Control
Notice shall have the right to withdraw such Purchase Notice by delivery, at any time prior to the
close of business on the Business Day immediately preceding the Repurchase Date or such longer
period as may be required by law, of a written notice of withdrawal to the Company
(if acting as its own Paying Agent) or the Paying Agent, which notice shall contain the
information specified in Section 3.8(c)(xii).



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



          (b) INTENTIONALLY OMITTED




          (c) Within twenty five (25) days after the occurrence of a Change in Control, the Company
shall mail, or cause to be mailed, to all Holders of record of the Securities at their addresses
shown in the Registrar, and to beneficial owners as required by applicable law, a notice (the
“Change In Control Notice”) of the occurrence of such Change in Control and the


19









 







Repurchase
Right arising as a result thereof. The Company shall deliver a copy of the Change in Control
Notice to the Trustee and shall cause a copy to be published at the expense of the Company in The
New York Times or The Wall Street Journal or another newspaper of national circulation.




          Each Change in Control Notice shall state:





          (i) the events causing the Change in Control;




          (ii) the date of such Change in Control;




          (iii) the Repurchase Date;




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




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




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




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




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




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




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




          (xi) that, on and after the Repurchase Date (unless there shall be a Default in the
payment of such Repurchase Price or such accrued and unpaid interest), interest on
Securities subject to Repurchase Upon Change in Control will cease to accrue, and all rights
of the Holders of such Securities shall terminate, other than the right to receive, upon
surrender of such Securities, the Repurchase Price and such accrued and unpaid interest;




          (xii) that a Holder will be entitled to withdraw its election in the Purchase Notice if
the Company (if acting as its own Paying Agent), or the Paying Agent



20









 




receives, prior to the
close of business on the Business Day immediately preceding the Repurchase Date, or such
longer period as may be required by law, a letter or facsimile transmission (receipt of
which is confirmed and promptly followed by a letter) setting forth (i) the name of such
Holder, (ii) a statement that such Holder is withdrawing its election to have Securities
repurchased, (iii) the principal amount of the Securities of such Holder to be so withdrawn,
which amount must be $1,000 or an integral multiple thereof, (iv) the certificate number of
such Securities to be so withdrawn, and (v) the principal amount, if any, of the Securities
of such Holder that remain subject to the Purchase Notice delivered by such Holder in
accordance with this Section 3.8, which amount must be $1,000 or an integral
multiple thereof;





          (xiii) the Conversion Price and any adjustments to the Conversion Price that will
result from the Change in Control;




          (xiv) that Securities with respect to which a Purchase Notice is given by a Holder may
be converted pursuant to Article X, if otherwise convertible in accordance with
Article X, only if such Purchase Notice has been withdrawn in accordance with this
Section 3.8; and




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



          At the Company’s written request, the Trustee shall mail such Change in Control Notice in the
Company’s name and at the Company’s expense; provided, however, that, in all cases, the text of
such Change in Control Notice shall be prepared by the Company.




          No failure of the Company to give a Change in Control Notice shall limit any Holder’s right to
exercise a Repurchase Right.




          (d) Subject to the provisions of this Section 3.8, the Company shall pay, or cause to
be paid, the Repurchase Price, plus accrued and unpaid interest, if any, to, and including, the
Repurchase Date, with respect to each Security as to which the Repurchase Right shall have been
exercised to the Holder thereof as promptly as practicable, but in no event more than three (3)
Business Days, following the later of the Repurchase Date and the time such Security is surrendered
to the Paying Agent.




          (e) Prior to 10:00 A.M., New York City time on a Repurchase Date, the Company shall deposit
with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in
trust in accordance with Section 2.4) money, in funds immediately available on the
Repurchase Date, sufficient to pay the Repurchase Price, plus accrued and unpaid interest, if any,
to, and including, the Repurchase Date, of all of the Securities that are to be repurchased by the
Company on such Repurchase Date pursuant to a Repurchase Upon Change in Control. The Paying Agent
shall return to the Company, as soon as practicable, any money not required for that purpose.




          (f) Once the Change in Control Notice and the Purchase Notice have been duly given in
accordance with this Section 3.8, the Securities to be repurchased pursuant to a Repurchase
Upon Change in Control shall, on the Repurchase Date, become due and payable at


21









 







the Repurchase
Price (plus accrued and unpaid interest, if any, to, and including, the Repurchase Date) applicable
thereto, and, on and after such date (unless there shall be a Default in the payment of the
Repurchase Price or such accrued and unpaid interest), such Securities shall cease to bear interest
and shall cease to be convertible pursuant to Article X, and all rights of the Holders of
such Securities shall terminate, other than the right to receive, in accordance with this
Section 3.8, the Repurchase Price and such accrued and unpaid interest.




          (g) Securities with respect to which a Purchase Notice has been duly delivered in accordance
with this Section 3.8 may be converted pursuant to Article X, if otherwise
convertible in accordance with Article X, only if such Purchase Notice has been withdrawn
in accordance with this Section 3.8 or if there shall be a Default in the payment of the
Repurchase Price or in the accrued and unpaid interest, if any, payable as herein provided upon
Repurchase Upon Change in Control.




          (h) If any Security shall not be paid upon surrender thereof for Repurchase Upon Change in
Control, the principal of, and accrued and unpaid interest on, such Security shall, until paid,
bear interest from the Repurchase Date at the rate borne by such Security on the principal amount
of such Security, and such Security shall continue to be convertible pursuant to Article X.




          (i) Any Security which is to be submitted for Repurchase Upon Change in Control only in part
shall be delivered pursuant to this Section 3.8 (with, if the Company or the Trustee so
requires, due endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or its attorney duly authorized in
writing), and the Company shall execute, and the Trustee shall authenticate and make available for
delivery to the Holder of such Security without service charge, a new Security or Securities, of
any authorized denomination as requested by such Holder, of the same tenor and in aggregate
principal amount equal to the portion of such Security not submitted for Repurchase Upon Change in
Control.




          (j) Notwithstanding anything herein to the contrary, there shall be no purchase of any
Securities pursuant to this Section 3.8 if there has occurred (prior to, on or after, as
the case may be, the giving, by the Holders of such Securities, of the required Purchase Notice)
and is continuing an Event of Default (other than a Default in the payment of the Repurchase Price
or accrued and unpaid interest, if any, payable as herein provided upon
Repurchase Upon Change in Control). The Paying Agent will promptly return to the respective
Holders thereof any Securities held by it during the continuance of an Event of Default (other than
a Default in the payment of the Repurchase Price or such accrued and unpaid interest), in which
case, upon such return, the Purchase Notice with respect to the Repurchase Upon Change in Control
shall be deemed to have been withdrawn.




          (k) Notwithstanding anything herein to the contrary, if the option granted to Holders to
require the repurchase of the Securities upon the occurrence of a Change in Control is determined
to constitute a tender offer, the Company shall comply with all applicable tender offer rules under
the Exchange Act, including Rule 13e-4 and Regulation 14E, and with all other applicable laws, and
will file a Schedule TO or any other schedules required under the Exchange Act or any other
applicable laws.




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          (l) As used herein and in the Securities:




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





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




          (ii) the Company consolidates with, or merges with or into, another Person or any
Person consolidates with, or merges with or into, the Company, in any such event other than
pursuant to a transaction where the Persons that “beneficially owned,” directly or
indirectly, the shares of the Company’s Voting Stock immediately prior to such transaction,
“beneficially own,” directly or indirectly, immediately after such transaction, shares of
the continuing, surviving or acquiring corporation’s Voting Stock representing at least a
majority of the total voting power of all outstanding classes of the Voting Stock of the
continuing, surviving or acquiring corporation; or




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


provided, however, that a Change in Control will not be deemed to have occurred if at least eighty
percent (80%) of the consideration (other than cash payments for fractional shares or pursuant to
statutory appraisal rights) in the merger or consolidation otherwise constituting the Change in
Control consists of Common Stock, depositary receipts or other certificates representing common
equity interests and any associated rights traded on a U.S. national securities exchange or quoted
on The Nasdaq National Market (or which will be so traded or quoted when issued or exchanged in
connection with such Change in Control), and, as a result of such transaction or transactions, the
Securities become convertible solely into such common
stock, depositary receipts or other certificates representing common equity interests and
associated rights.




ARTICLE IV.

COVENANTS




     4.1 Payment of Securities.



          The Company shall pay all amounts due with respect to the Securities on the dates and in the
manner provided in the Securities. All such amounts shall be considered paid on the date due if
the Paying Agent holds (or, if the Company is acting as Paying Agent, the Company has segregated
and holds in trust in accordance with Section 2.4) on that date money (and, if


23









 







applicable
as provided herein and in accordance herewith, shares of Common Stock) sufficient to pay the amount
then due with respect to the Securities (unless there shall be a Default in the payment of such
amounts to the respective Holder(s)). The Company shall pay interest on any overdue amount
(including, to the extent permitted by applicable law, overdue interest) at the rate borne by the
Securities.




     4.2 Maintenance of Office or Agency.



          The Company will maintain an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee, Registrar or co-Registrar) where Securities may be surrendered for
registration of transfer or exchange or conversion and where notices and demands to or upon the
Company in respect of the Securities and this Indenture may be served. The Company will give
prompt written notice to the Trustee of the location, and any change in the location, of such
office or agency. If at any time the Company shall fail to maintain any such required office or
agency or shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the designated Corporate Trust Office of
the Trustee.




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




          The Company hereby designates the designated Corporate Trust Office of the Trustee as an
agency of the Company in accordance with Section 2.3.




     4.3 Rule 144A Information and Annual Reports



          (a) At any time when the Company is not subject to Sections 13 or 15(d) of the Exchange Act,
the Company shall promptly provide to the Trustee and shall, upon request, provide to any Holder,
beneficial owner or prospective purchaser of Securities or shares of Common Stock issued upon
conversion of any Securities or issued pursuant to Article III, the information required to
be delivered pursuant to Rule 144A(d)(4) under the Securities Act to facilitate the resale of such
Securities or shares of Common Stock pursuant to Rule 144A. The Company shall take such further
action as any Holder or beneficial holder of such Securities or shares of Common Stock may
reasonably request to the extent required from time to time to enable such Holder or beneficial
holder to sell its Securities or shares of Common Stock in accordance with Rule 144A, as such rule
may be amended from time to time.




          (b) The Company shall, in accordance with TIA Section 314(a), deliver to the Trustee, within
thirty (30) calendar days after the Company files such annual reports, information, documents and
other reports with the SEC, copies of the Company’s annual reports (which shall contain audited
financial statements of the Company) and of the information, documents and other reports (or copies
of such portions of any of the foregoing as the SEC may


24









 







by rules and regulations prescribe) which
the Company is required to file with the SEC pursuant to Section 13 or Section 15(d) of the
Exchange Act; provided, however, that the Company shall not be required to deliver to the Trustee
any material for which the Company has sought and received confidential treatment by the SEC. In
the event the Company is at any time no longer subject to the reporting requirements of Section 13
or Section 15(d) of the Exchange Act, the Company shall continue to provide the Trustee and to each
Holder, within thirty (30) calendar days after the Company would have been required to file such
reports with the SEC, annual and quarterly consolidated financial statements substantially
equivalent to financial statements that would have been included in reports filed with the SEC if
the Company were subject to the reporting requirements of Section 13 or Section 15(d) of the
Exchange Act, including, with respect to annual information only, a report thereon by the Company’s
certified independent public accountants as such would be required in such reports filed with the
SEC and, in each case, together with a management’s discussion and analysis of financial condition
and results of operations which would be so required. The Company also shall comply with the other
provisions of TIA Section 314(a).




          (c) Delivery of such reports, information and documents to the Trustee is for informational
purposes only and the Trustee’s receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained therein, including the
Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to
rely exclusively on Officers’ Certificates).




     4.4 Compliance Certificate; Statement by Officers as to Default.



          The Company shall deliver to the Trustee, within ninety (90) calendar days after the end of
each fiscal year of the Company, or, if earlier, by the date the Company is, or would be, required
to file with the SEC the Company’s annual report (whether on Form 10-K under the
Exchange Act or another appropriate form) for such fiscal year, an Officers’ Certificate, one
of the signers of which shall be the principal executive officer, principal financial officer or
principal accounting officer of the Company, stating whether or not the signers know of any Default
or Event of Default by the Company in performing any of its obligations under this Indenture or the
Securities. If such signers do know of any such Default or Event of Default, the certificate shall
describe the Default or Event of Default and its status.




     4.5 Stay, Extension and Usury Laws.



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





25









 





     4.6 Corporate Existence.



          The Company will do or cause to be done all things necessary to preserve and keep in full
force and effect its corporate existence and the rights (charter and statutory), licenses and
franchises of the Company; provided, however, that the Company shall not be required to preserve
any such right, license or franchise, if in the good faith judgment of the Board of Directors the
loss of such right, license or franchise does not have a material adverse impact on the Holders.




     4.7 Notice of Default.



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




     4.8 Further Instruments and Acts.



          Upon request of the Trustee, the Company shall 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.




ARTICLE V.

SUCCESSORS




5.1 When Company May Merge, Etc.




          The Company shall not consolidate with, or merge with or into, or sell, transfer, lease,
convey or otherwise dispose of all or substantially all of the property or assets of the Company
to, another person, whether in a single transaction or series of related transactions, unless: (i)
the Company is the surviving person, or the resulting surviving person is organized and existing
under the laws of the United States, any State thereof or the District of Columbia; or (ii) such
person assumes by supplemental indenture all the obligations of the Company under the Securities
and this Indenture; and (iii) immediately after giving effect to the transaction, no Default or
Event of Default shall exist.




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




     5.2 Successor Substituted.



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




26









 








ARTICLE VI.

DEFAULTS AND REMEDIES




     6.1 Events of Default.



          An “Event of Default” occurs if:




               (i) the Company fails to pay the principal of any Security when the same becomes due
and payable, whether at maturity, upon Redemption, on a Repurchase Date with respect to a
Repurchase Upon Change in Control or otherwise;



               (ii) the Company fails to pay Interest on any Security when due, if such failure
continues for thirty (30) days after the date when due;



               (iii) the Company fails to timely provide a Change in Control Notice, as required by
the provisions of this Indenture;



               (iv) the Company defaults in its obligation to convert the Securities into shares of
Common Stock, cash or a combination of cash and Common Stock upon exercise of a Holder’s
conversion right and such default continues for ten (10) days;



               (v) the Company defaults in its obligation to repurchase any Security on a Repurchase
Date with respect to a Repurchase Upon Change in Control or otherwise;



               (vi) the Company defaults in its obligation to redeem any Security after exercise of
its option to redeem;



               (vii) the Company fails to perform or observe any of the covenants in Article
IV for sixty (60) days after written notice to the Company by the Trustee or to the
Company and the Trustee by Holders of at least fifty percent (50%) in the aggregate
principal amount of the Securities then outstanding;



               (viii) there occurs an event of default with respect to the Company’s or any of its
Subsidiaries’ Indebtedness having a principal amount then outstanding, individually or in
the aggregate, of at least fifteen million dollars ($15,000,000), whether such Indebtedness
now exists or is hereafter incurred, which default or defaults: (a) shall have resulted in
such Indebtedness becoming or being declared due and payable prior to the date on which it
would otherwise have become due and payable; or (b) shall constitute the failure to pay such
Indebtedness at the final stated maturity thereof (after expiration of any applicable grace
period);



               (ix) any final judgment or judgments for the payment of money in excess of fifteen
million dollars ($15,000,000) shall be rendered against the Company and shall not be
discharged for any period of sixty (60) consecutive days during which time a stay of
enforcement shall not be in effect or during which time an appeal has not been filed; or



27









 





               (x) the Company pursuant to, or within the meaning of, any Bankruptcy Law, insolvency
law, or other similar law now or hereafter in effect or otherwise:




               (a) commences a voluntary case,




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




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




               (d) makes a general assignment for the benefit of its creditors, or




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




               (1) is for relief against the Company in an involuntary case or
proceeding, or adjudicates the Company insolvent or bankrupt,




               (2) appoints a Custodian of the Company for all or substantially all of
the property or assets of the Company, or




               (3) orders the winding up or liquidation of the Company and, in the
case of each of the foregoing clauses (1), (2) and (3) of this Section
6.1(x), the order or decree remains unstayed and in effect for at least
ninety (90) consecutive days.



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




          When a Default is cured, it ceases.




     6.2 Acceleration.



          If an Event of Default (excluding an Event of Default specified in Section 6.1(x) with
respect to the Company (but including an Event of Default specified in Section 6.1(ix))
occurs and is continuing, the Trustee by notice to the Company, or the Holders of at least fifty
percent (50%) in aggregate principal amount of the Securities then outstanding by notice to the
Company and the Trustee, may declare the Securities to be immediately due and payable in full. The
notice must specify the Default, demand that it be remedied and state that the notice is a
“Notice of Default”. If the Holders of at least fifty percent (50%) in aggregate principal
amount of the outstanding Securities request in writing the Trustee to give such notice on their
behalf,

28









 








the Trustee shall do so. Upon such declaration, the principal of, premium, if any, and any
accrued and unpaid interest on, all Securities shall be due and payable immediately. If an Event
of Default specified in Section 6.1(x) occurs, the principal of, and accrued and unpaid
interest on, all the Securities shall ipso facto become and be immediately due and payable without
any declaration or other act on the part of the Trustee or any Holder. The Holders of a majority
in aggregate principal amount of the Securities then outstanding by written notice to the Trustee
may rescind or annul an acceleration and its consequences if (A) the rescission would not conflict
with any order or decree, (B) all existing Events of Default, except the nonpayment of principal or
interest that has become due solely because of the acceleration, have been cured or waived and (C)
all amounts due to the Trustee under Section 7.7 have been paid.




     6.3 Other Remedies.



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




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




     6.4 Waiver of Past Defaults.



          Subject to Sections 6.7 and 9.2, the Holders of a majority in aggregate
principal amount of the Securities then outstanding may, by written notice to the Trustee, waive
any past Default or Event of Default and its consequences, other than (A) a Default or Event of
Default in the payment of the principal of, or premium, if any, or interest or additional interest
on, any Security, or in the payment of the Redemption Price or Repurchase Price (or accrued and
unpaid interest, if any, payable as herein provided upon Redemption or Repurchase Upon Change in
Control), (B) a Default or Event of Default arising from a failure by the Company to convert any
Securities into shares of Common Stock in accordance with this Indenture or (C) any Default or
Event of Default in respect of any provision of this Indenture or the Securities which, under
Section 9.2, cannot be modified or amended without the consent of the Holder of each
outstanding Security affected. When a Default or an Event of Default is waived, it is cured and
ceases. This Section 6.4 shall be in lieu of TIA Section 316(a)(1)(B), and TIA Section
316(a)(1)(B) is hereby expressly excluded from this Indenture, as permitted by the TIA.




     6.5 Control by Majority.



          The Holders of a majority in aggregate principal amount of the Securities then outstanding may
direct the time, method and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred on it. However, the Trustee may refuse to
follow any direction that conflicts with law or this Indenture, is unduly prejudicial to the rights
of other Holders or would involve the Trustee in personal liability unless the Trustee

29









 








is offered
indemnity reasonably satisfactory to it; provided, that the Trustee may take any other action
deemed proper by the Trustee which is not inconsistent with such direction. This Section
6.5 shall be in lieu of TIA Section 316(a)(1)(A), and TIA Section 316(a)(1)(A) is hereby
expressly excluded from this Indenture, as permitted by the TIA.




     6.6 Limitation on Suits.



          Except as provided in Section 6.7, a Securityholder may not institute any proceeding
under this Indenture, or for the appointment of a receiver or a trustee, or for any other remedy
under this Indenture unless:





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




          (ii) the Holders of at least fifty percent (50%) in aggregate principal amount of the
Securities then outstanding make a written request to the Trustee to pursue the remedy;




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




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




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



          A Securityholder may not use this Indenture to prejudice the rights of another Securityholder
or to obtain a preference or priority over another Securityholder (it being understood that the
Trustee does not have an affirmative duty to ascertain whether or not such actions or forbearances
are unduly prejudicial to such Holders).




     6.7 Rights of Holders to Receive Payment.



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




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




30









 








     6.8 Collection Suit by Trustee.



          If an Event of Default specified in Section 6.1(i) or (ii) occurs and is
continuing, the Trustee may recover judgment in its own name and as trustee of an express trust
against the Company for the whole amount due with respect to the Securities, including any unpaid
and accrued interest.




     6.9 Trustee May File Proofs of Claim.



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




          The Trustee may collect and receive any moneys or other property payable or deliverable on any
such claims and to distribute the same, and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or similar official in any judicial proceeding is hereby authorized by each Holder to
make such payments to the Trustee and, in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any
other amounts due the Trustee under Section 7.7.




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




     6.10 Priorities.




          If the Trustee collects any money pursuant to this Article VI, it shall pay out the
money in the following order:




          First: to the Trustee for amounts due under Section 7.7;




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




          Third: to the Company.




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



     6.11 Undertaking For Costs.



          In any suit for the enforcement of any right or remedy under this Indenture or in any suit
against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant in the suit other than the Trustee of an
undertaking to pay the costs of the suit, and the court in its discretion may assess
reasonable

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costs, including reasonable attorneys’ fees and expenses, against any party litigant in
the suit, having due regard to the merits and good faith of the claims or defenses made by the
party litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a
Holder pursuant to Section 6.7 or a suit by Holders of more than ten percent (10%) in
aggregate principal amount of the outstanding Securities.




ARTICLE VII.

TRUSTEE




     7.1 Duties of Trustee.



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




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





          (i) the duties of the Trustee shall be determined solely by the express provisions of
this Indenture and the TIA and the Trustee need perform only those duties that are
specifically set forth in this Indenture and no others, and no implied covenants or
obligations shall be read into this Indenture or the TIA against the Trustee; and




          (ii) in the absence of bad faith on its part, the Trustee may conclusively rely,
without investigation, as to the truth or the statements and the correctness of the opinions
expressed therein, upon and statements, certificates or opinions furnished to the Trustee
and conforming to the requirements of this Indenture but need not verify the contents
thereof.



     However, in the case of any such certificates or opinions which by any provision hereof are
specifically required to be furnished to the Trustee, the Trustee shall examine the certificates
and opinions to determine whether or not they conform 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).



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




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




          (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 negligent in ascertaining the
pertinent facts; and




          (iii) the Trustee shall not be liable with respect to any action it takes or omits to
take in good faith in accordance with a direction received by it pursuant to Section
6.2, 6.4 or 6.5.



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          (d) Whether or not therein expressly so provided, every provision of this Indenture that in
any way relates to the Trustee is subject to this paragraphs (a), (b) and (c) of Section
7.1 and Section 7.2.




          (e) No provision of this Indenture shall require the Trustee to expend or risk its own funds
or otherwise incur any liability. The Trustee shall be under no obligation to exercise any of its
rights and powers under this Indenture at the request of any Holders, pursuant to the provisions of
this Indenture, including, without limitation, Section 6.5, unless such Holder’s shall have
offered to the Trustee security and indemnity satisfactory to it against any loss, liability or
expense which might be incurred by it in compliance with such request or direction.




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




     7.2 Rights of Trustee.



          (a) The Trustee may conclusively rely 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.




          (b) Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate
or an Opinion of Counsel or both. 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. The Trustee
may consult with counsel of its own selection and the advice of such counsel and Opinions of
Counsel with respect to legal matters relating to this Indenture and the Securities shall be full
and complete authorization and protection from liability in respect of any action taken, suffered
or omitted by it hereunder in good faith and in reliance thereon.




          (c) The Trustee may act through its attorneys, accountants, experts and such other
professionals as the Trustee deems necessary, advisable or appropriate and shall not be responsible
for the misconduct or negligence of any attorney, accountant, expert or other such professional
appointed with due care.




          (d) The Trustee shall not be liable for any action it takes or omits to take in good faith
that it believes to be authorized or within the rights or powers conferred upon it by this
Indenture.




          (e) Unless otherwise specifically provided in this Indenture, any demand, request, direction
or notice from the Company shall be sufficiently evidenced by a Company Order or a Company Request.




          (f) The Trustee shall not be charged with knowledge of any Default or Event of Default under
Section 6.1 (other than under Section 6.1(a) (subject to the following sentence) or
Section 6.1(b)) unless either (i) a Responsible Officer shall have actual knowledge
thereof, or

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(ii) the Trustee shall have received notice thereof in accordance with Section
12.2 from the Company or any Holder of the Securities.




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




          (h) 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.




          (i) The Trustee may request that the Company deliver a certificate substantially in the form
of Exhibit D setting forth the names of individuals and/or titles of officers authorized at
such time to take specified actions pursuant to this Indenture, which certificate may be signed by
any person specified as so authorized in any such certificate previously delivered and not
superseded.




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




     7.3 Individual Rights of Trustee.



          The Trustee may become the owner or pledgee of Securities and may otherwise deal with the
Company or any Affiliate of the Company with the same rights it would have if it were not Trustee.
However, in the event that the Trustee acquires any conflicting interest within the meaning of the
TIA it must eliminate such conflict within ninety (90) days, or apply (subject to the consent of
the Company) to the Commission for permission to continue as trustee or resign. Any Agent may do
the same with like rights and duties. The Trustee is also subject to Sections 7.10 and
7.11.




     7.4 Trustee’s Disclaimer.



          The Trustee shall not be responsible for and 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 or any money paid to the Company or upon the
Company’s direction under any provision of this Indenture, it shall not be responsible for the use
or application of any money received by any Paying Agent other than the Trustee, and it shall not
be responsible for any statement or recital herein or any statement in the Securities or any other
document in connection with the sale of the Securities or pursuant to this Indenture other than its
certificate of authentication.




     7.5 Notice of Defaults.



          If a Default or Event of Default occurs and is continuing, the Trustee shall mail to Holders
of Securities a notice of the Default or Event of Default within ninety (90) days after

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such Event
of Default becomes known to the Trustee. Except in the case of a Default in payment on any
Security (including the failure to make a mandatory repurchase pursuant hereto), the Trustee may
withhold the notice if and so long as a committee of its Responsible Officers in good faith
determines that withholding the notice is in the interests of the Holders of the Securities.




     7.6 Reports by Trustee to Holder of the Securities.



          Within sixty (60) days after each May 15 beginning with the May 15 following the date of this
Indenture, and for so long as Securities remain outstanding, the Trustee shall mail to the Holders
of the Securities a brief report dated as of such reporting date that complies with TIA Section
313(a) (but if no event described in TIA Section 313(a) has occurred within the twelve (12) months
preceding the reporting date, no report need be transmitted). The Trustee also shall comply with
TIA Section 313(b). The Trustee shall also transmit by mail all reports as required by TIA Section
313(c).




          A copy of each report at the time of its mailing to the Holders of Securities shall be mailed
to the Company and filed with the Commission and each stock exchange on which the Securities are
listed in accordance with TIA Section 313(d). The Company shall promptly notify the Trustee in
writing when the Securities are listed on any stock exchange or of any delisting thereof.




     7.7 Compensation, Reimbursement and Indemnity.



          The Company shall pay to the Trustee from time to time such compensation for its acceptance of
this Indenture and the rendering by it of the services required hereunder as shall be agreed upon
in writing by the Company and the Trustee. The Trustee’s compensation shall not be limited by any
law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee
promptly upon request for all reasonable disbursements, advances and expenses incurred or made by
or on behalf of it in addition to the compensation for its services. Such expenses shall include
the reasonable compensation, disbursements and expenses of the
Trustee’s attorneys, accountants, experts and such other professionals as the Trustee deems
necessary, advisable or appropriate.




          The Company shall indemnify the Trustee and any predecessor Trustee (which for purposes of
this Section 7.7 shall include its officers, directors, employees, agents and
shareholders), and hold it harmless against, any and all losses, liabilities, claims, damages or
expenses, including taxes (other than taxes based upon, measured by or determined by the income of
the Trustee) and reasonable attorneys’ fees and expenses, incurred by it arising out of or in
connection with the acceptance or administration of its duties under this Indenture (including its
duties under Section 9.6), including the costs and expenses of enforcing this Indenture
against the Company (including this Section 7.7) and defending itself against or
investigating any claim (whether asserted by the Company, any Holder or any other Person) or
liability in connection with the exercise or performance of any of its powers or duties hereunder,
except to the extent any such loss, damage, claim, liability or expense shall have been determined
by a court of competent jurisdiction to have been caused by its gross negligence or willful
misconduct. The Trustee shall notify the Company promptly of any claim for which it

35









 








may seek
indemnity. Failure by the Trustee to so notify the Company shall not relieve the Company of its
obligations hereunder. At the Trustee’s sole discretion, the Company shall defend any claim or
threatened claim asserted against the Trustee, with counsel satisfactory to the Trustee, and the
Trustee shall cooperate in the defense at the Company’s expense. The Trustee may have separate
counsel and the Company shall pay the reasonable fees and expenses of such counsel. The Company
need not pay for any settlement made without its consent, which consent shall not be unreasonably
withheld.




          The obligations of the Company under this Section 7.7 shall survive the resignation or
removal of the Trustee, the satisfaction and discharge of this Indenture and the termination of
this Indenture.




          To secure the Company’s payment obligations in this Section 7.7, the Trustee shall
have a Lien prior to the Securities on all money or property held or collected by the Trustee,
except that held in trust to pay principal, Redemption Price of, or interest on, particular
Securities. Such Lien shall survive the resignation or removal of the Trustee, the satisfaction
and discharge of this Indenture and the termination of this Indenture.




          When the Trustee incurs expenses or renders services after an Event of Default specified in
Section 6.1(x) occurs, the expenses and the compensation for the services (including the
fees and expenses of its agents and counsel) are intended to constitute expenses of administration
under any Bankruptcy Law.




     7.8 Replacement of Trustee.



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




          The Trustee may resign in writing at any time and be discharged from the trust hereby created
by so notifying the Company. The Holders of Securities of a majority in principal amount of the
then outstanding Securities may remove the Trustee by so notifying the Trustee and the Company in
writing. The Company may remove the Trustee if:





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




          (b) the Trustee is adjudged a bankrupt or an insolvent or an order for relief is
entered with respect to the Trustee under any Bankruptcy Law;




          (c) a custodian, receiver or public officer takes charge of the Trustee or its
property for the purpose of rehabilitation, conversation or liquidation; or




          (d) the Trustee becomes incapable of acting.



          If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any
reason, the Company shall promptly appoint a successor Trustee. Within one year after the date on
which the successor Trustee takes office, the Holders of a majority in principal

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amount of the then
outstanding Securities may appoint a successor Trustee to replace the successor Trustee appointed
by the Company.




          If a successor Trustee does not take office within thirty (30) days after the retiring trustee
resigns or is removed, the retiring Trustee, the Company, or the Securityholders of at least 10% in
principal amount of the then outstanding Securities may petition any court of competent
jurisdiction, in the case of the Trustee, at the expense of the Company, for the appointment of a
successor Trustee.




          If the Trustee, after written request by any Securityholder who has been a bona fide holder of
a Security or Securities for at least six (6) months, fails to comply with Section 7.10,
such Securityholder may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.




          A successor Trustee shall deliver a written acceptance of its appointment to the retiring
Trustee and to the Company. Thereupon, the resignation or removal of the retiring Trustee shall
become effective, and the successor Trustee shall have all the rights, powers and duties of the
Trustee under this Indenture. The Company shall mail a notice of its succession to each Holder of
a Security. The retiring Trustee shall promptly transfer all property held by it as Trustee to the
successor Trustee; provided all sums owing to the Trustee hereunder have been paid and
subject to the Lien provided for in Section 7.7. Notwithstanding replacement of the
Trustee pursuant to this Section 7.8, the Company’s obligations under Section 7.7
shall continue for the benefit of the retiring Trustee.




     7.9 Successor Trustee by Merger, Etc.



          If the Trustee consolidates, merges or converts into, or transfers all or substantially all of
its corporate trust business to, another corporation that is eligible under Section 7.10,
the successor corporation without any further act shall be the successor Trustee.




     7.10 Eligibility; Disqualification.



          There shall at all times be a Trustee hereunder that is a corporation organized and doing
business under the laws of the United States of America or of any state thereof (including the
District of Columbia) that is authorized under such laws to exercise corporate trust power, that is
subject to supervision or examination by federal or state authorities and that has (or, in the case
of a corporation included in a bank holding company system, the related bank holding company shall
have) a combined capital and surplus of at least fifty million dollars ($50,000,000) as set forth
in its (or its related bank holding company’s) most recent published annual report of condition.




          This Indenture shall always have a Trustee who satisfies the requirements of TIA Section
310(a)(1), (2) and (5). The Trustee is subject to TIA Section 310(b).




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     7.11 Preferential Collection of Claims Against Company.



          The Trustee is subject to 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.




ARTICLE VIII.

DISCHARGE OF INDENTURE




     8.1 Termination of the Obligations of the Company.



          This Indenture shall cease to be of further effect if (a) either (i) all outstanding
Securities (other than Securities replaced pursuant to Section 2.7 hereof) have been
delivered to the Trustee for cancellation or (ii) all outstanding Securities have become due and
payable at their scheduled maturity or upon Redemption or Repurchase Upon Change in Control, and in
any case the Company irrevocably deposits, prior to the applicable due date, with the Trustee or
the Paying Agent (if the Paying Agent is not the Company or any of its Affiliates) cash sufficient
to pay all amounts due and owing on all outstanding Securities (other than Securities replaced
pursuant to Section 2.7 hereof) on the Maturity Date or Redemption Date, or Repurchase
Date, as the case may be; (b) the Company pays to the Trustee all other sums payable hereunder by
the Company and the Company has otherwise satisfied in full all of its obligations under this
Indenture; (c) no Default or Event of Default with respect to the Securities shall exist on the
date of such deposit; (d) such deposit will not result in a breach or violation of, or constitute a
Default or Event of Default under, this Indenture or any other agreement or instrument to which the
Company is a party or by which it is bound; and (e) the Company has delivered to the Trustee an
Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent
provided for herein relating to the satisfaction and discharge of this Indenture have been complied
with; provided, however, that Sections 2.3, 2.4, 2.5, 2.6,
2.7, 2.8, 2.15, 2.16, 2.17, 3.5, 3.8,
4.1, 4.2, 4.5, 7.7 and 7.8 and Articles VIII and
X and Sections 12.2, 12.3 and 12.4 shall survive any discharge of
this Indenture until such time as the Securities have been paid in full and there are no Securities
outstanding. Thereafter only the Company’s obligations in Section 7.7 shall survive such
satisfaction and discharge




     8.2 Application of Trust Money.



          The Trustee shall hold in trust money deposited with it pursuant to Section 8.1. It
shall apply the deposited money through the Paying Agent and in accordance with this Indenture to
the payment of the principal of and any unpaid and accrued interest on the Securities.




     8.3 Repayment to Company.



          The Trustee and the Paying Agent shall promptly notify the Company of, and pay to the Company
upon the written request of the Company, any excess money held by them at any time. The Trustee
and the Paying Agent shall pay to the Company upon the written request of the Company any money
held by them for the payment of the principal of, premium, if any, or any accrued and unpaid
interest or additional interest on, the notes that remains unclaimed for two (2) years; provided,
however, that the Trustee or such Paying Agent, before being required to make any such repayment,
shall at the expense of the Company, cause to be published once in

38









 








a newspaper of general
circulation in the City of New York or cause to be mailed to each Holder, notice stating that such
money remains unclaimed and that, after a date specified therein, which shall not be less than
thirty (30) days from the date of such publication or mailing, any unclaimed balance of such money
then remaining will be repaid to the Company. After payment to the Company, Securityholders
entitled to the money must look to the Company for payment as
general creditors, subject to applicable law, and all liability of the Trustee and the Paying
Agent with respect to such money and payment shall, subject to applicable law, cease.




     8.4 Reinstatement.



          If the Trustee or Paying Agent is unable to apply any money in accordance with Sections
8.1 and 8.2 by reason of any legal proceeding or by reason of any order or judgment of
any court or governmental authority enjoining, restraining or otherwise prohibiting such
application, the obligations of the Company under this Indenture and the Securities shall be
revived and reinstated as though no deposit had occurred pursuant to Sections 8.1 and
8.2 until such time as the Trustee or Paying Agent is permitted to apply all such money in
accordance with Sections 8.1 and 8.2; provided, however, that if the Company has
made any payment of amounts due with respect to any Securities because of the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of such Securities to
receive such payment from the money held by the Trustee or Paying Agent.




ARTICLE IX.

AMENDMENTS




     9.1 Without Consent of Holders.



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





          (a) to evidence the assumption of the Company’s obligations by a successor;




          (b) to evidence the acceptance of appointment by a successor trustee;




          (c) to make any changes or modifications to this Indenture necessary to cure and
ambiguity or correct any error in this Indenture, so long as such action will not adversely
affect the interests of the Holders;




          (d) to qualify or maintain the qualification of this Indenture under the TIA;




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




          (f) to establish the forms or terms of the Securities;




          (g) to add to the covenants of the Company described in this Indenture for the benefit
of Securityholders; or



39









 






          (h) to make other changes to this Indenture or forms or terms of the Securities,
provided no such change individually or in the aggregate with all other such changes has or
will have a material adverse effect on the interests of the Holders.



     9.2 With Consent of Holders.



          The Company, with the consent of the Trustee, may amend or supplement this Indenture or the
Securities without notice to any Securityholder but with the written consent of the Holders of at
least a majority in aggregate principal amount of the outstanding Securities. Subject to
Sections 6.4 and 6.7, the Holders of a majority in aggregate principal amount of
the outstanding Securities may, by notice to the Trustee, waive compliance by the Company with any
provision of this Indenture or the Securities without notice to any other Securityholder.
Notwithstanding anything herein to the contrary, without the consent of each Holder of each
outstanding Security affected, an amendment, supplement or waiver, including a waiver pursuant to
Section 6.4, may not:





          (a) extend the Maturity Date of the principal of, or the payment date of any
installment of interest on, any Security;




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




          (c) change the currency in which any Security is payable;




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




          (e) reduce any amount payable upon Redemption or repurchase of any Security;




          (f) change the Company’s obligation to maintain an office or agency in the places and
for the purposes specified in this Indenture;




          (g) affect the Company’s obligation to redeem any Securities upon a Redemption Date in
a manner adverse to the Holders;




          (h) affect the Company’s obligation to repurchase any Securities upon a Change in
Control in a manner adverse to the Holders;




          (i) impair the right of Holders to convert Securities or reduce the number of shares
of Common Stock, the amount of cash or the amount of any other property receivable upon
conversion;




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




          (k) reduce the quorum or voting requirements under this Indenture;



40









 






          (l) reduce the percentage of the aggregate principal amount of the outstanding
Securities whose Holders must consent to a waiver of compliance with any provision of this
Indenture or a waiver of any Default or Event of Default; or




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



          Promptly after an amendment, supplement or waiver under Section 9.1 or this
Section 9.2 becomes effective, the Company shall mail, or cause to be mailed, to
Securityholders a notice briefly describing such amendment, supplement or waiver. Any failure of
the Company to mail such notice shall not in any way impair or affect the validity of such
amendment, supplement or waiver.




          It shall not be necessary for the consent of the Holders under this Section 9.2 to
approve the particular form of any proposed amendment, supplement or waiver, but it shall be
sufficient if such consent approves the substance thereof.




     9.3 Compliance with Trust Indenture Act.



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




     9.4 Revocation and Effect of Consents.



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




          After an amendment, supplement or waiver becomes effective with respect to the Securities, it
shall bind every Holder unless it makes a change that requires, pursuant to Section 9.2,
the consent of each Holder affected. In that case, the amendment, supplement or waiver shall bind
each Holder of a Security who has consented to it and, provided that notice of such amendment,
supplement or waiver is reflected on a Security that evidences the same debt as the consenting
Holder’s Security, every subsequent Holder of a Security or portion of a Security that evidences
the same debt as the consenting Holder’s Security.




     9.5 Notation on or Exchange of Securities.



          If an amendment, supplement or waiver changes the terms of a Security, the Trustee may require
the Holder of the Security to deliver it to the Trustee. The Trustee may place an appropriate
notation on the Security as directed and prepared by the Company about the

41









 








changed terms and return
it to the Holder. Alternatively, if the Company so determines, the Company in exchange for the
Security shall issue and the Trustee, upon receipt of a Company Order, shall authenticate a new
Security that reflects the changed terms.




     9.6 Trustee Protected.



          The Trustee shall sign any amended or supplemental indenture authorized pursuant to this
Article IX if the amendment or supplement does not affect the rights, duties, liabilities
or immunities of the Trustee. The Company may not sign an amended or supplemental indenture until
the Board of Directors approves such amended or supplemental indenture. In executing any amended
or supplemental indenture, the Trustee shall be provided with an Opinion of Counsel and an
Officers’ Certificate, and, subject to Section 7.1, shall be fully protected in
conclusively relying upon such documents.




ARTICLE X.

CONVERSION




     10.1 Conversion Privilege; Restrictive Legends.



          (a) Subject to the provisions of Sections 3.4 and 3.8, the Securities shall be
convertible into shares of Common Stock at any time on or after the earlier of (x) the Registration
Date or (y) two hundred seventy (270) days following the Issue Date but prior to the close of
business on the Maturity Date, in accordance with this Article X and as set forth below. A
Security, or portion of a Security, which has been called for Redemption pursuant to Paragraph 6 of
the Securities may be surrendered for conversion into shares of Common Stock; provided, however,
that such Security or portion thereof may be surrendered for conversion pursuant to this paragraph
only until the close of business on the Redemption Date.




          (b) The initial Conversion Price shall be $8.14 per share of Common Stock. The Conversion
Price shall be subject to adjustment in accordance with Sections 10.7 through
10.12.




          (c) Whenever any event described in Section 10.1 shall occur which shall cause the
Securities to become convertible into shares of Common Stock, the Company shall promptly deliver,
in accordance with Section 12.2, written notice of the convertibility of the Securities to
the Trustee and each Holder. Such written notice and public announcement shall include a
description of such event, a description of the periods during which the Securities shall
be convertible and the procedures by which a Holder may convert its Securities. At the
Company’s request, upon reasonable prior written notice agreed to by the Trustee, the Trustee
shall, in the Company’s name and at the Company’s expense, deliver to each Holder the written
notice of the convertibility of the Securities required by this Section 10.1(c); provided,
that the form and content of such notice shall be prepared by the Company.




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




42









 








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




     10.2 INTENTIONALLY OMITTED.



     10.3 Conversion Procedure.



          To convert a Security, a Holder must satisfy the requirements of paragraph 9 of the
Securities. As soon as practicable following the date (the “Conversion Date”) on which the
Holder satisfies all those requirements, the Company shall deliver to the Holder through the
Conversion Agent a certificate for the number of full shares of Common Stock issuable upon the
conversion, as provided in Paragraph 9 of the Securities, and a check for the amount of cash
payable in lieu of any fractional share. On and after the Conversion Date, the person in whose
name such certificate is to be registered shall be treated as a shareholder of record of the
Company, and all rights of the Holder of the Security to be converted shall terminate, other than
the right to receive the shares of Common Stock and cash deliverable as provided in the preceding
sentence. A Holder of Securities is not entitled to any rights of a holder of Common Stock until
such Holder has converted its Securities into shares of Common Stock, or is deemed to be a
shareholder of record of the Company, as provided in this paragraph, and then only to the extent
such Securities are deemed to have been so converted or such Holder is so deemed to be a
shareholder of record.




          Except as provided in the Securities or in this Article X or in Article III,
no payment or adjustment will be made for accrued interest on, or additional interest with respect
to, a converted Security or for dividends on any Common Stock issued on or prior to conversion. If
any Holder surrenders a Security for conversion after the close of business on the record date for
the payment of an installment of interest and prior to the related interest payment date, then,
notwithstanding such conversion, the interest payable with respect to such Security on such
interest payment date shall be paid on such interest payment date to the Holder of record of such
Security at the close of business on such record date; provided, however, that such Security, when
surrendered for conversion, must be accompanied by payment to the Conversion Agent on behalf of the
Company of an amount equal to the interest payable on such interest payment date on the portion so
converted; provided further, however, that such payment to the Conversion Agent described in the
immediately preceding proviso in respect of a Security surrendered for conversion shall not be
required if such Security is called for Redemption pursuant to Section 3.4 and paragraphs 6
of the Securities; provided further, that, if the Company shall have, prior to the Conversion Date
with respect to a Security, defaulted in a payment of interest on such Security, then in no event
shall the Holder of such Security who surrenders such Security for conversion be required to pay
such defaulted interest or the interest that shall have accrued on such defaulted

43









 








interest pursuant
to Section 2.12 (it being understood that nothing in this Section 10.3 shall affect
the Company’s obligations under Section 2.12).




          If a Holder converts more than one Security at the same time, the number of full shares of
Common Stock issuable upon such conversion shall be based on the total principal amount of all
Securities converted. Upon surrender of a Security that is converted in part, the Trustee shall
authenticate for the Holder a new Security equal in principal amount to the unconverted portion of
the Security surrendered.




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




     10.4 Fractional Shares.



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




     10.5 Taxes on Conversion.



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




     10.6 Company to Provide Stock.



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




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




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




44









 








     10.7 Adjustment of Conversion Price.



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




          (a) In case the Company shall (1) pay a dividend in shares of Common Stock to all
holders of Common Stock, (2) make a distribution in shares of Common Stock to all holders
of Common Stock, (3) subdivide the outstanding shares of Common Stock into a greater number
of shares of Common Stock or (4) combine the outstanding shares of Common Stock into a
smaller number of shares of Common Stock, the Conversion Price in effect immediately prior
to such action shall be adjusted so that the Holder of any Security thereafter surrendered
for conversion shall be entitled to receive the number of shares of Common Stock which such
Holder would have owned immediately following such action had such Securities been
converted immediately prior thereto. Any adjustment made pursuant to this Section
10.7(a) shall become effective immediately after the record date in the case of a
dividend or distribution and shall become effective immediately after the effective date in
the case of a subdivision or combination.




          (b) In case the Company shall issue rights or warrants to all holders of Common Stock,
entitling them, for a period expiring not more than sixty (60) days immediately following
the record date for the determination of holders of Common Stock entitled to receive such
rights or warrants, to subscribe for or purchase shares of Common Stock (or securities
convertible into or exchangeable or exercisable for Common Stock), at a price per share (or
having a conversion, exchange or exercise price per share) that is less than the current
market price (as determined pursuant to Section 10.7(e)) of Common Stock on the
record date for the determination of holders of Common Stock entitled to receive such
rights or warrants, the Conversion Price shall be increased by multiplying the Conversion
Price in effect immediately prior to such record date by a fraction of which (A) the
numerator shall be the sum of (i) the number of shares of Common Stock outstanding at the
close of business on such record date and (ii) the number of shares of Common Stock which
the aggregate exercise, conversion,
exchange or other price at which the Underlying Shares (as defined below) may be
subscribed for or purchased pursuant to such rights or warrants would purchase at such
current market price and (B) the denominator shall be the sum of (i) number of shares of
Common Stock outstanding at the close of business on such record date and (ii) the
aggregate number of shares (the “Underlying Shares”) of Common Stock underlying all
such issued rights or warrants (whether by exercise, conversion, exchange or otherwise).
Such increase shall become effective immediately prior to the opening of business on the
day following such record date. In no event shall the Conversion Price be increased
pursuant to this Section 10.7(b).




          (c) In case the Company shall dividend or distribute to all holders of Common Stock
shares of Capital Stock of the Company (other than Common Stock), evidences of Indebtedness
or other assets, or shall dividend or distribute to all holders of Common Stock rights or
warrants to subscribe for or purchase securities (other than those referred to in
Section 10.7(b)), if these distributions, aggregated on a rolling twelve (12) month
basis, have a per share value exceeding fifteen percent (15%) of the market price of the
Company’s Common Stock on the Trading Day immediately preceding the declaration of the
distribution, then in each such case the Conversion



45









 







Price shall be decreased by multiplying
the Conversion Price in effect immediately prior to the close of business on the record
date for the determination of shareholders entitled to such dividend or distribution by a
fraction of which (A) the numerator shall be the current market price of Common Stock (as
determined pursuant to Section 10.7(e)) on such record date and (B) the denominator
shall be an amount equal to (i) such current market price plus (ii) the fair market value
(as determined in good faith by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution), on such record date, of the portion of the
shares of Capital Stock, evidences of Indebtedness, assets, rights and warrants to be
dividended or distributed applicable to one share of Common Stock, such increase to become
effective immediately prior to the opening of business on the day following such record
date; provided, however, that if such denominator is equal to or less than one, then, in
lieu of the foregoing adjustment to the Conversion Price, adequate provision shall be made
so that each Holder shall have the right to receive upon conversion of its Securities, in
addition to the shares of Common Stock issuable (and cash, if any, payable) upon such
conversion, an amount of shares of Capital Stock, evidences of Indebtedness, assets, rights
and/or warrants that such Holder would have received had such Holder converted all of its
Securities on such record date.




          (d) In addition to the foregoing adjustments in Subsections (a), (b) and (c) above,
the Company, from time to time and to the extent permitted by law, may decrease the
Conversion Price by any amount for a period of at least twenty (20) days or such longer
period as may be required by law, if the Board of Directors has made a determination, which
determination shall be conclusive, that such decrease would be in the best interests of the
Company. Such Conversion Price decrease shall be irrevocable during such period. The
Company shall give notice to the Trustee and cause notice of such decrease to be mailed to
each Holder of Securities at such Holder’s address as the same appears on the registry
books of the Registrar, at least fifteen (15) days prior to the date on which such decrease
commences.




          (e) For the purpose of any computation under Subsections (a), (b) or (c) above of this
Section 10.7, the current market price per share of Common Stock on the date fixed
for determination of the shareholders entitled to receive the issuance or distribution
requiring such computation (the “Determination Date”) shall be deemed to be the
average of the Closing Sale Prices for the ten (10) consecutive Trading Days immediately
preceding the Determination Date; provided, however, that (i) if the “ex” date for any
event (other than the event requiring such computation) that requires an adjustment to the
Conversion Price pursuant to subsection (a), (b), or (c), above occurs on or after the
tenth (10th) Trading Day prior to the Determination Date, and prior to the “ex” date for
the issuance or distribution requiring such computation, the Closing Sale Price for each
Trading Day prior to the “ex” date for such other event shall be adjusted by multiplying
such Closing Sale Price by the reciprocal of the fraction by which the Conversion Price is
so required to be adjusted as a result of such other event, (ii) if the “ex” date for any
event (other than the event requiring such computation) that requires an adjustment to the
Conversion Price pursuant to Subsection (a), (b), or (c), above occurs on or after the “ex”
date for the issuance or distribution requiring such computation and on or prior to the
Determination Date, the Closing Sale Price for each



46









 







Trading Day on and after the “ex” date
for such other event shall be adjusted by multiplying such Closing Sale Price by the same
fraction by which the Conversion Price is so required to be adjusted as a result of such
other event, and




          (f) if the “ex” date for the event requiring such computation is on or prior to the
Determination Date, after taking into account any adjustment required pursuant to this
proviso, the Closing Sale Price for each Trading Day on and 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 the purposes of this Section 10.7, whose determination shall be
conclusive and described in a Resolution of the Board of Directors) of the evidences of
Indebtedness, shares of Capital Stock or other securities or assets or cash being
distributed (in the event requiring such computation) applicable to one share of Common
Stock as of the close of business on the day before such “ex” date.



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




     10.8 No Adjustment.



          No adjustment in the Conversion Price shall be required if Holders may participate in a
transaction that would otherwise give rise to an adjustment under Section 10.7, so long as
the distributed assets or securities the Holders would receive upon conversion of the Securities,
if convertible, exchangeable, or exercisable, are convertible, exchangeable, or exercisable, as
applicable, without any loss of rights or privileges for a period of at least sixty (60) days
following the Conversion Date.




          No adjustment in the Conversion Price shall be required:





          (a) upon the issuance of shares of Common Stock or any securities exchangeable into
Common Stock or carrying the right to purchase any of the foregoing, except as stated
above;




          (b) for a change in the par value or no par value of the Common Stock; or




          (c) for accrued and unpaid interest.



47









 





          No adjustment in the Conversion Price shall be required unless the adjustment would require an
increase or decrease of at least one percent (1%) of the Conversion Price as last adjusted (or, if
never adjusted, the initial Conversion Price); provided, however, that any adjustments which by
reason of this Section 10.8 are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. All calculations under this Article X shall be
made to the nearest cent or to the nearest one-millionth of a share, as the case may be.




     10.9 Adjustments For Tax Purposes.



          The Company may make such increases in the Conversion Price, in addition to those required by
Section 10.7 hereof, as it determines to be advisable in order that any stock dividend,
subdivision of shares, distribution or rights to purchase stock or securities or distribution of
securities convertible into or exchangeable for stock made by the Company or to its shareholders
will not be taxable to the recipients thereof.




     10.10 Notice of Adjustment.



          Whenever the Conversion Price is adjusted, the Company shall promptly mail to Holders at the
addresses appearing on the Registrar’s books a notice of the adjustment and file with the Trustee
an Officers’ Certificate briefly stating the facts requiring the adjustment and the manner of
computing it. The certificate shall be conclusive evidence of the correctness of such adjustment.
At the Company’s request, upon reasonable prior written notice agreed to by the Trustee, the
Trustee shall, in the Company’s name and at the Company’s expense, mail to Holders at the addresses
appearing on the Registrar’s books such notice of adjustment required
by this Section 10.10; provided, that the form and content of such notice shall be
prepared by the Company.




     10.11 Notice of Certain Transactions.



          In the event that:





     (1) the Company takes any action, or becomes aware of any event, which would
require an adjustment in the Conversion Price,




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




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


the Company shall mail to Holders at the addresses appearing on the Registrar’s books and the
Trustee a written notice stating the proposed record, effective or expiration date, as the case may
be, of any transaction referred to in clause (1), (2) or (3) of this Section 10.11. The
Company shall mail such notice at least twenty (20) days before such date; however, failure to mail
such notice or any defect therein shall not affect the validity of any transaction referred to in
clause (1), (2) or (3) of this Section 10.11. At the Company’s request, upon reasonable
prior written notice agreed to by the Trustee, the Trustee shall, in the Company’s name and at the
Company’s expense, mail to Holders at the addresses appearing on the Registrar’s books such written
notice

48









 








required by this Section 10.11; provided, that the form and content of such notice
shall be prepared by the Company.




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



          If any of the following shall occur, namely: (i) any reclassification or change in the Common
Stock issuable upon conversion of Securities (other than a change in par value, or from par value
to no par value, or from no par value to par value, or as a result of a subdivision or
combination), (ii) any consolidation, merger or binding share exchange to which the Company is a
party other than a merger in which the Company is the continuing Person and which does not result
in any reclassification of, or change (other than a change in name, or par value, or from par value
to no par value, or from no par value to par value or as a result of a subdivision or combination)
in, the Common Stock or (iii) any sale, transfer, lease, conveyance or other disposition of all or
substantially all of the property or assets of the Company, then the Company or such successor or
purchasing Person, as the case may be, shall, as a condition precedent to such reclassification,
change, consolidation, merger, binding share exchange, sale, transfer, lease, conveyance or
disposition, execute and deliver to the Trustee, together with the documents required by Section
12.4 hereof, a supplemental indenture in form reasonably satisfactory to the Trustee providing
that, at and after the effective time of such reclassification, change, consolidation, merger,
binding share exchange, sale, transfer, lease, conveyance or disposition,
the Holder of each Security then outstanding shall have the right to convert such Security
into the kind and amount of shares of stock and other securities and property (including cash)
receivable upon such reclassification, change, consolidation, merger, binding share exchange, sale,
transfer, lease, conveyance or disposition by a holder of the number of shares of Common Stock
deliverable upon conversion of such Security immediately prior to such reclassification, change,
consolidation, merger, binding share exchange, sale, transfer, lease, conveyance or disposition,
assuming that such Holder would not have exercised any rights of election that such Holder would
have had as a holder of Common Stock to select a particular type of consideration. Such
supplemental indenture shall provide for adjustments of the Conversion Price which shall be as
nearly equivalent as may be practicable to the adjustments of the Conversion Price provided for in
this Article X. If, in the case of any such consolidation, merger, binding share exchange,
sale, transfer, lease, conveyance or disposition, the stock or other securities and property
(including cash) receivable thereupon by a holder of Common Stock includes shares of stock or other
securities and property of a Person other than the successor or purchasing Person, as the case may
be, in such consolidation, merger, binding share exchange, sale, transfer, lease, conveyance or
disposition, then such supplemental indenture shall also be executed by such other Person and shall
contain such additional provisions to protect the interests of the Holders of the Securities as the
Board of Directors in good faith shall reasonably determine necessary by reason of the foregoing
(which determination shall be described in a Board Resolution). The provision of this Section
10.12 shall similarly apply to successive consolidations, mergers, binding share exchanges,
sales, transfers, leases, conveyances or dispositions.




          In the event a supplemental indenture shall have been executed pursuant to this Section
10.12, the Company shall promptly file with the Trustee an Officers’ Certificate briefly
stating the reasons therefor, the kind or amount of shares of stock or securities or property
(including cash) receivable by Holders of the Securities upon the conversion of their Securities

49









 








after any such reclassification, change, consolidation, merger, binding share exchange, sale,
transfer, lease, conveyance or disposition and any adjustment to be made with respect thereto.




     10.13 Trustee’s Disclaimer.



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




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




ARTICLE XI.

SUBORDINATION




     All obligations under the Notes will be subordinate to the extent set forth in the
Subordination and Intercreditor Agreement, dated the date hereof, among the Company, the Trustee,
FMP Agency Services, LLC, as Agent to the Senior Creditors named therein and Credit Suisse
International, as the Subordinated Creditor (the “Subordination Agreement”). A Holder by its
acceptance of a Security agrees to be bound by this Article XI and the terms and provisions of the
Subordination Agreement and authorizes and expressly directs the Trustee, on its behalf, to take
such action as may be necessary or appropriate to effectuate the subordination between the Holders
and the holders of Senior Indebtedness (as defined in the Subordination Agreement) of the Company
(including, but not limited to, the execution of the Subordination Agreement) and appoints the
Trustee as attorney-in-fact for any and all such purposes.



ARTICLE XII.

MISCELLANEOUS




     12.1 Trust Indenture Act Controls.



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




     12.2 Notices.



          Any notice or communication by the Company or the Trustee to the other is duly given if in
writing and delivered in person, mailed by first-class mail or by express delivery to

50









 








the other
party’s address stated in this Section 12.2. The Company or the Trustee by notice to the
other may designate additional or different addresses for subsequent notices or communications.




          Any notice or communication to a Holder shall be mailed to its address shown on the register
kept by the Note Registrar. Failure to mail a notice or communication to a Holder or any defect in
it shall not affect its sufficiency with respect to other Holders.




          If a notice or communication is mailed in the manner provided above, it is duly given, whether
or not the addressee receives it.




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




          All notices or communications shall be in writing.





			
	     The Company’s address is:	 	Terremark Worldwide, Inc.

2601 South Bayshore Drive

Miami, Florida 33133

Attn: Chief Financial Officer






			
	     The Trustee’s address is:	 	The Bank of New York Trust Company, N.A.
10161 Centurion Parkway

Jacksonville, Florida 32256

Attention: Corporate Trust Administration





     12.3 Communication by Holders with Other Holders.



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




     12.4 Certificate and Opinion as to Conditions Precedent.



          Upon any request or application by the Company to the Trustee to take any action under this
Indenture, the Company shall furnish to the Trustee:





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




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



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




51









 








     12.5 Statements Required in Certificate or Opinion.



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





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




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




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




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



     12.6 Rules by Trustee and Agents.



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




     12.7 Legal Holidays.



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




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




     12.8  Duplicate Originals.



          The parties may sign any number of copies of this Indenture. Each signed copy shall be an
original, but all of them together represent the same agreement. Delivery of an executed
counterpart by facsimile shall be effective as delivery of a manually executed counterpart thereof.




     12.9 Governing Law.



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




52









 








     12.10 No Adverse Interpretation of Other Agreements.



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




     12.11 Successors.



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




     12.12 Separability.



          In case any provision in this Indenture or in the Securities shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby and a Holder shall have no claim therefor against any party
hereto.




     12.13 Table of Contents, Headings, Etc.



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




     12.14 Calculations in Respect of The Securities.



          The Company and its agents shall make all calculations under this Indenture and the Securities
in good faith. In the absence of manifest error, such calculations shall be final and binding on
all Holders. The Company shall provide a copy of such calculations to the Trustee as required
hereunder, and, absent such manifest error, the Trustee shall be entitled to conclusively rely on
the accuracy of any such calculation without independent verification.




     12.15 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.




     12.16 Waiver of Jury Trial.



     EACH OF THE COMPANY AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, ANY AND



53









 




ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR
RELATING TO THIS INDENTURE, THE SECURITIES OR THE TRANSACTION CONTEMPLATED HEREBY.




***THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK;

SIGNATURE PAGE FOLLOWS***




54









 





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




	 	 	 	 	 	 	 
	 	 	TERREMARK WORLDWIDE, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Jose A. Segrera 	 	 
	 

	 	Name:
	 	 

Jose A. Segrera
	 	 
	 

	 	Title:
	 	Executive Vice President and
Chief Financial Officer	 	 
	 
	 	 	 	 	 	 
	 	 	THE BANK OF NEW YORK TRUST COMPANY, N.A., as Trustee	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Geraldine Creswell 	 	 
	 

	 	Name:
	 	 

Geraldine Creswell
	 	 
	 

	 	Title:
	 	Assistant Treasurer	 	 








55









 








EXHIBIT A




FORM OF SECURITY

TERREMARK WORLDWIDE, INC.

0.50% SENIOR SUBORDINATED CONVERTIBLE NOTE DUE 2009



THIS NOTE AND THE INDEBTEDNESS EVIDENCED HEREBY ARE SUBORDINATE IN THE MANNER AND TO THE EXTENT SET
FORTH IN THAT CERTAIN SUBORDINATION AND INTERCREDITOR AGREEMENT (THE “SUBORDINATION AGREEMENT”)
DATED AS OF JANUARY 5, 2007 AMONG TERREMARK WORLDWIDE, INC. AS THE ISSUER, THE TRUSTEE, FMP AGENCY
SERVICES, LLC, AS THE AGENT TO THE SENIOR CREDITORS NAMED THEREIN, AND CREDIT SUISSE,
INTERNATIONAL, AS THE SUBORDINATED CREDITOR NAMED THEREIN, AND EACH HOLDER OF THIS NOTE, BY ITS
ACCEPTANCE HEREOF, SHALL BE BOUND BY THE PROVISIONS OF THE SUBORDINATION AND INTERCREDITOR
AGREEMENT.




1. INTEREST.



          Terremark Worldwide, Inc., a Delaware corporation (the “Company”), promises to pay
interest on the principal amount of this Security at 0.50% per annum for the first 24 months that
the Note is outstanding, and therafter at a rate of 1.50% per annum until maturity. The Company
will pay interest upon the maturity of the Securities. All interest payable hereunder shall be
payable in kind by adding such amount to the aggregate principal amount of the Securities.
Interest on the Securities will accrue on the principal amount from, and including, January 5,
2007, to, but excluding, the Maturity Date. Interest will be computed on the basis of a 360-day
year of twelve 30-day months, and accrued interest shall compound and be added to outstanding
principal on each July 1 and January 1 (of if such date is not a Business Day, the immediately
succeeding Business Day, such dates, the “Interest Payment Date”), as well as on June 30,
2009.




2. MATURITY.



          The Securities will mature on June 30, 2009.




3. METHOD OF PAYMENT.



          Except as provided in the Indenture (as defined below), the Company will pay interest on the
Securities to the persons who are Holders of record of Securities at the close of business on June
30, 2009. Holders must surrender Securities to a Paying Agent to collect the principal amount,
Redemption Price, Repurchase Price of the Securities, plus, if applicable, accrued and unpaid
interest, if any, payable as herein provided upon Redemption or Repurchase Upon Change in Control,
as the case may be. The Company will pay, in money of the United States that at the time of
payment is legal tender for payment of public and private debts, all amounts due in cash with
respect to the Securities, which amounts shall be paid (A) in the case this Security is in global
form, by wire transfer of immediately available funds to the account specified by the Holder hereof
and (B) in the case this Security is held in other than global form, by wire transfer of
immediately available funds to the account specified by the Holder hereof or,




 









 







if no such account is specified, by mailing a check to such Holder’s address shown in the Note
Register.




4. PAYING AGENT, REGISTRAR, CONVERSION AGENT.



          Initially, The Bank of New York Trust Company, N.A., a national banking association (the
“Trustee”), will act as Paying Agent, Registrar and Conversion Agent. The Company may
change any Paying Agent, Registrar or Conversion Agent without notice.




5. INDENTURE.



          The Company issued the Securities under an Indenture dated as of January 5, 2007 (the
“Indenture”) between the Company and the Trustee. The terms of the Securities include
those stated in the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 as amended and in effect from time to time (the “TIA”). The
Securities are subject to all such terms, and Holders are referred to the Indenture and the TIA for
a statement of such terms. The Securities are general unsecured senior subordinated obligations of
the Company limited to $4,000,000 aggregate principal amount, except as otherwise provided in the
Indenture (except for Securities issued in substitution for destroyed, mutilated, lost or stolen
Securities). Terms used herein without definition and which are defined in the Indenture have the
meanings assigned to them in the Indenture.




6. OPTIONAL REDEMPTION.



          The Company shall have the right, at the Company’s option, on any Interest Payment Date that
is six months following the date of this Indenture, upon no less than fifteen (15) days prior
written notice to the Trustee and the Initial Purchaser, to redeem (the “Redemption”) all
of the Securities at a redemption price equal to (i) the amount set forth below (expressed as
percentages of the principal amount outstanding on the date of redemption), plus (ii) the amount
(if any) by which the fair market value of on such date of the Common Stock into which the Security
is then convertible exceeds the principal amount of the Security on such date, plus (iii) accrued,
but unpaid Interest (the “Redemption Payment” or “Redemption Price”), if redeemed
during the following monthly periods following the closing date:




	 	 	 	 	 
	Monthly Period	 	Percentage
	After Month Six and Before Month Twelve
	 	 	113.00	%
	On or After Month Twelve and Before Month Eighteen
	 	 	112.40	%
	On or After Month Eighteen and Before Month Twenty Four
	 	 	111.30	%
	On or After Month Twenty Four
	 	 	108.80	%






7. NOTICE OF REDEMPTION.



          Notice of Redemption will be mailed at least twenty (20) days but not more than sixty (60)
days before the Redemption Date to each Holder of Securities to be redeemed at its address
appearing in the Note Register. Securities in denominations larger than $1,000 principal amount
may be redeemed in part but only in integral multiples of $1,000 principal amount.




A-2









 








8. REPURCHASE AT OPTION OF HOLDER UPON A CHANGE IN CONTROL.



          Subject to the terms and conditions of the Indenture, in the event of a Change in Control,
each Holder of the Securities shall have the right, at the Holder’s option, to require the Company
to repurchase such Holder’s Securities including any portion thereof which is $1,000 in principal
amount or any integral multiple thereof on a date selected by the Company (the “Repurchase
Date”), which date is no later than forty five (45) days after the date of the Change in
Control, at a price payable in cash equal to one hundred percent (100%) of the principal amount of
such Security, plus accrued and unpaid interest to, and including, the Repurchase Date.




          Within twenty five (25) days after the occurrence of the Change in Control, the Company must
mail, or cause to be mailed, notice of the occurrence of such Change in Control to each Holder.
Such notice shall include, among other things, a description of the procedure which a Holder must
follow to exercise the Repurchase Right. To exercise the Repurchase Right, a Holder of Securities
must, in accordance with the provisions of the Indenture, (i) deliver, no later than the close of
business on the Business Day immediately preceding the Repurchase Date, a Purchase Notice to the
Company (if it is acting as its own Paying Agent) or to the Paying Agent; and (ii) deliver, at any
time after the delivery of such Purchase Notice, the Securities with respect to which the Holder is
exercising its Repurchase Right (together with all necessary endorsements).




          A “Change In Control” shall be deemed to have occurred at such time as:





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




          (ii) the Company consolidates with, or merges with or into, another Person or any
Person consolidates with, or merges with or into, the Company, in any such event other than
pursuant to a transaction where the Persons that “beneficially owned,” directly or
indirectly, the shares of the Company’s Voting Stock immediately prior to such transaction,
“beneficially own,” directly or indirectly, immediately after such transaction, shares of
the continuing, surviving or acquiring corporation’s Voting Stock representing at least a
majority of the total voting power of all outstanding classes of the Voting Stock of the
continuing, surviving or acquiring corporation; or




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



A-3









 





provided, however, that a Change in Control will not be deemed to have occurred if at least eighty
percent (80%) of the consideration (other than cash payments for fractional shares or pursuant to
statutory appraisal rights) in the merger or consolidation otherwise constituting the Change in
Control consists of common stock, depositary receipts or other certificates representing common
equity interests and any associated rights traded on a U.S. national securities exchange or quoted
on The Nasdaq National Market (or which will be so traded or quoted when issued or exchanged in
connection with such Change in Control), and, as a result of such transaction or transactions, the
Securities become convertible solely into such common stock, depositary receipts or other
certificates representing common equity interests and associated rights.




9. CONVERSION.



          The Securities shall be convertible into shares of Common Stock at any time on or after the
earlier of (x) the Registration Date or (y) 270 days following the Issue Date but prior to the
close of business on the Maturity Date, in accordance with the terms of the Indenture and as set
forth below.




          The initial Conversion Price is $8.14 per share, subject to adjustment in the event of certain
circumstances as specified in the Indenture. The Company will deliver a check in lieu of any
fractional share. On conversion, no payment or adjustment for any unpaid and accrued interest on,
or additional interest with respect to, the Securities will be made, except as specified in the
Indenture.




          To convert a Security, a Holder must (1) complete and sign the Conversion Notice attached to
this Note, with appropriate signature guarantee, on the back of the Security, (2) surrender the
Security to a Conversion Agent, (3) furnish appropriate endorsements and transfer documents if
required by the Registrar or Conversion Agent and (4) pay any tax or duty if required pursuant to
the Indenture. A Holder may convert a portion of a Security if the portion is $1,000 principal
amount or an integral multiple of $1,000 principal amount.




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




10. INTENTIONALLY OMITTED.



11. SUBORDINATION.



          All obligations under the Notes will be subordinate to the extent set forth in the
Subordination Agreement. A Holder by its acceptance of a Security agrees to be bound by the terms
and provisions of Article XI of the Indenture and the terms and provisions of the


A-4









 







Subordination Agreement and authorizes and expressly directs the Trustee, on its behalf, to
take such action as may be necessary or appropriate to effectuate the subordination between the
Holders and the holders of Senior Indebtedness (as defined in the Subordination Agreement) of the
Company (including, but not limited to, the execution of the Subordination Agreement) and appoints
the Trustee as attorney-in-fact for any and all such purposes.




12. DENOMINATIONS, TRANSFER, EXCHANGE.



          The Securities are in registered form, without coupons, in denominations of $1,000 principal
amount and integral multiples of $1,000 principal amount. The transfer of Securities may be
registered and Securities may be exchanged as provided in the Indenture. The Registrar may require
a Holder, among other things, to furnish appropriate endorsements and transfer documents. No
service charge shall be made for any such registration of transfer or exchange, but the Company may
require payment of a sum sufficient to cover any tax or similar governmental charge that may be
imposed in connection with certain transfers or exchanges. The Company, the Trustee and the
Registrar shall not be required to register the transfer of or exchange any Security (i) during a
period beginning at the opening of business fifteen (15) days before the mailing of a notice of
redemption of the Securities selected for Redemption under Section 3.4 of the Indenture and ending
at the close of business on the day of such mailing or (ii) that has been selected for Redemption
or for which a Purchase Notice has been delivered, and not withdrawn, in accordance with the
Indenture, except the unredeemed or unrepurchased portion of Securities being redeemed or
repurchased in part.




13. PERSONS DEEMED OWNERS.



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




14. MERGER OR CONSOLIDATION.



          The Company shall not consolidate with, or merge with or into, or sell, transfer, lease,
convey or otherwise dispose of all or substantially all of the property or assets of the Company
to, another person, whether in a single transaction or series of related transactions, unless (i)
such other person is a corporation organized under the laws of the United States, any State thereof
or the District of Columbia; (ii) such person assumes by supplemental indenture all the obligations
of the Company under the Securities and the Indenture; and (iii) immediately after giving effect to
the transaction, no Default or Event of Default shall exist.




15. AMENDMENTS, SUPPLEMENTS AND WAIVERS.



          Subject to certain exceptions and to the provisions of the Indenture, the Indenture and the
Securities may be amended or supplemented with the consent of the Holders of at least a majority in
aggregate principal amount of the outstanding Securities, and certain existing Defaults or Events
of Default may be waived with the consent of the Holders of a majority in aggregate principal
amount of the Securities then outstanding. In accordance with the terms of the Indenture, the
Company, with the consent of the Trustee, may amend or supplement the Indenture or the Securities
without notice to or the consent of any Securityholder: (i) to evidence


A-5









 







the assumption of the Company’s obligations by a successor; (ii) to evidence the acceptance of
appointment by a successor trustee; (iii) to make any changes or modifications to the Indenture
necessary to cure and ambiguity or correct any error in the Indenture, so long as such action will
not adversely affect the interests of the Holders; (iv) to qualify or maintain the qualification of
the Indenture under the TIA; (v) to secure the obligations of the Company in respect of the
Securities; (vi) to establish the forms or terms of the Securities; (vii) to add to the covenants
of the Company described in the Indenture for the benefit of Securityholders; or (viii) to make
other changes to the Indenture or forms or terms of the Securities, provided no such change
individually or in the aggregate with all other such changes has or will have a material adverse
effect on the interests of the Holders. In accordance with the terms of the Indenture, certain
amendments, supplements and waivers cannot be made without the consent of each Holder of each
outstanding Security affected.




16. DEFAULTS AND REMEDIES.



          Subject to the provisions of the Indenture, an “Event of Default” occurs if: (i) the
Company fails to pay the principal of any Security when the same becomes due and payable, whether
at maturity, upon Redemption, on a Repurchase Date with respect to a Repurchase Upon Change in
Control or otherwise; (ii) the Company fails to pay Interest on any Security when due, if such
failure continues for thirty (30) days after the date when due; (iii) the Company fails to timely
provide a Change in Control Notice, as required by the provisions of this Indenture; (iv) the
Company defaults in its obligation to convert the Securities into shares of Common Stock, cash or a
combination of cash and Common Stock upon exercise of a Holder’s conversion right and such default
continues for ten (10) days; (v) the Company defaults in its obligation to repurchase any Security
on a Repurchase Date with respect to a Repurchase Upon Change in Control or otherwise; (vi) the
Company defaults in its obligation to redeem any Security after exercise of its option to redeem;
(vii) the Company fails to perform or observe any of the covenants in Article IV of the
Indenture for sixty (60) days after written notice to the Company by the Trustee or to the Company
and the Trustee by Holders of at least fifty percent (50%) in the aggregate principal amount of the
Securities then outstanding; (viii) there occurs an event of default with respect to the Company’s
or any of its Subsidiaries’ Indebtedness having a principal amount then outstanding, individually
or in the aggregate, of at least fifteen million ($15,000,000), whether such Indebtedness now
exists or is hereafter incurred, which default or defaults: (a) shall have resulted in such
Indebtedness becoming or being declared due and payable prior to the date on which it would
otherwise have become due and payable; or (b) shall constitute the failure to pay such Indebtedness
at the final stated maturity thereof (after expiration of any applicable grace period); (ix) any
final judgment or judgments for the payment of money in excess of fifteen million ($15,000,000)
shall be rendered against the Company and shall not be discharged for any period of sixty (60)
consecutive days during which time a stay of enforcement shall not be in effect or during which
time an appeal has not been filed; or (x) certain events of bankruptcy, insolvency or
reorganization involving the Company.




          If an Event of Default (excluding an Event of Default specified in Section 6.1(x) of the
Indenture (but including an Event of Default specified in Section 6.1(ix) of the Indenture)) occurs
and is continuing, the Trustee by notice to the Company or the Holders of at least fifty percent
(50%) in aggregate principal amount of the Securities then outstanding by notice to the Company and
the Trustee, may declare the Securities to be immediately due and payable in full.




A-6









 







Upon such declaration, the principal of, premium, if any, and any accrued and unpaid interest
on, all Securities shall be due and payable immediately. If an Event of Default specified in
Section 6.1(x) of the Indenture occurs, the principal of, and accrued and unpaid interest on, all
the Securities shall ipso facto become and be immediately due and payable without any declaration
or other act on the part of the Trustee or any Holder. The Holders of a majority in aggregate
principal amount of the Securities then outstanding by written notice to the Trustee may rescind or
annul an acceleration and its consequences if (A) the rescission would not conflict with any order
or decree, (B) all existing Events of Default, except the nonpayment of principal or interest that
has become due solely because of the acceleration, have been cured or waived and (C) all amounts
due to the Trustee under Section 7.7 if the Indenture have been paid.




          Holders may not enforce the Indenture or the Securities except as provided in the Indenture.
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 the Indenture, is unduly prejudicial to the rights
of other Holders or would involve the Trustee in personal liability unless the Trustee is offered
indemnity reasonably satisfactory to it; provided, that the Trustee may take any other action
deemed proper by the Trustee which is not inconsistent with such direction.




          If a Default or Event of Default occurs and is continuing, the Trustee shall mail to Holders
of Securities a notice of the Default or Event of Default within ninety (90) days after such Event
of Default becomes known to the Trustee. Except in the case of a Default in payment on any
Security (including the failure to make a mandatory repurchase pursuant hereto), the Trustee may
withhold the notice if and so long as a committee of its Responsible Officers in good faith
determines that withholding the notice is in the interests of the Holders of the Securities.




17. REGISTRATION RIGHTS.



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




18. TRUSTEE DEALINGS WITH THE COMPANY.



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




19. NO RECOURSE AGAINST OTHERS.



          No past, present or future director, officer, employee or shareholder, as such, of the Company
shall have any liability for any obligations of the Company under the Securities or the Indenture
or for any claim based on, in respect of, or by reason of, such obligations or their creation.
Each Holder, by accepting a Security, waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Securities.




A-7









 








20. AUTHENTICATION.



          This Security shall not be valid until authenticated by the manual signature of the Trustee or
an authenticating agent in accordance with the Indenture.




21. ABBREVIATIONS.



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



The company will furnish to any holder upon written request and without charge a copy of the
indenture. Requests may be made to:




Terremark Worldwide, Inc.




2601 South Bayshore Drive




Miami, Florida 33133




Attn: Chief Financial Officer




A-8









 






[FORM OF ASSIGNMENT]




I or we assign to




PLEASE INSERT SOCIAL SECURITY OR

OTHER IDENTIFYING NUMBER




 




(please print or type name and address)




 





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




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




	 	 	 
	Dated:
	 	 
	 
	 	 
	 


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


	 	 






A-9









 





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




[Check One]



(1)
___ to the Company or any Subsidiary thereof, or



(2)
___ pursuant to, and in compliance with, the exemption from registration provided by Rule 144A
under the Securities Act of 1933, as amended, or



(3)
___ pursuant to, and in compliance with, the exemption from registration provided by Rule 144
under the Securities Act of 1933, as amended, or



(4) ___pursuant to, and in compliance with, an exemption from registration under the Securities
Act of 1933, as amended, other than Rule 144A or Rule 144, or



(5)
___ pursuant to an effective registration statement under the Securities Act of 1933, as
amended,



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



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




          Unless one of the items (1) through (5) is checked, the Trustee will refuse to register any of
the Securities evidenced by this certificate in the name of any person other than the registered
Holder thereof; provided, however, that if item (3) or (4) is checked, the Company or the Trustee
may require, prior to registering any such transfer of the Securities, in their sole discretion,
such written legal opinions, certifications and other information as the Trustee or the Company
have reasonably requested to confirm that such transfer is being made pursuant to an exemption
from, or in a transaction not subject to, the registration requirements of the Securities Act of
1933, as amended. If item (2) is checked, the purchaser must complete the certification below.




A-10









 








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




	 	 	 	 	 
	Dated:
	 	 	 	 
	 

	 	 

	 	 
	Signed:
	 	 	 	 
	 

	 	 

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





A-11









 





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




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




Dated:                                         




NOTICE: To be executed by an executive officer




A-12









 





CONVERSION NOTICE




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



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




$                                        



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




	 	 	 
	 


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


	 	 
	 
	 	 
	 


	 	 
	 
	 	 
	 


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






	 	 	 	 	 
	Dated:
	 	 	 	 
	 

	 	 

	 	 
	Signature(s):
	 	 	 	 
	 

	 	 

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




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




A-13









 








PURCHASE NOTICE



Certificate No. of Security:                                         



If you want to elect to have this Security purchased by the Company pursuant to Section 3.8 of the
Indenture, check the box: [ ]



If you want to elect to have only part of this Security purchased by the Company pursuant to
Section 3.8 of the Indenture, state the principal amount to be so purchased by the Company:




	 	 	 	 	 	 	 
	$
	 	 	 	 	 	 
	 	 	 	 	 
	(in an integral multiple of $1,000)	 	 
	 
	 	 	 	 	 	 
	Date:	 	 	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 	 
	 	 	 
	 
	 	 	 
	Signature(s):	 	 
	 
	 	 	 	 	 	 
	 	 	 
	 
	 	 	 
	(Sign exactly as your name(s) appear(s)
on the other side of this Security)	 	 
	 
	 	 	 	 	 	 
	Signature(s) guaranteed by:	 	 
	 
	 	 	 	 	 	 
	 	 	 
	(All signatures must be guaranteed by
a guarantor institution participating
in the Securities Transfer Agents
Medallion Program or in such other
guarantee program acceptable to the
Trustee.)	 	 






A-14









 





SCHEDULE A




SCHEDULE OF EXCHANGES OF INTERESTS

IN THE GLOBAL SECURITY (a)




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



(a) This is included in Global Securities only.





 









 








EXHIBIT B-1




FORM OF PRIVATE PLACEMENT LEGEND




          THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
EXCEPT AS SET FORTH IN THE NEXT SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST
HEREIN, THE HOLDER: (2) REPRESENTS THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) (A “QIB”) OR (B) IT IS AN INSTITUTIONAL “ACCREDITED INVESTOR”
(AS DEFINED IN RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT (AN “IAI”);
(3) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE COMPANY OR ANY
OF ITS SUBSIDIARIES, (B) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QIB PURCHASING FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A,
(C) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (D) TO AN IAI
THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATION AND AGREEMENTS RELATING TO THE TRANSFER OF THE NOTES (THE FORM OF WHICH CAN BE
OBTAINED FROM THE TRUSTEE) AND IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF
NOTES LESS THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN
COMPLIANCE WITH THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE
COMPANY), (E) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY) OR (F) PURSUANT TO
AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION, AND (4) AGREES THAT IT
WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THE INDENTURE CONTAINS A PROVISION REQUIRING THE
TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING.




B-1-1









 





EXHIBIT B-2




FORM OF LEGEND FOR GLOBAL SECURITY




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




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




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




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





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EXHIBIT B-3




FORM OF LEGEND REGARDING

REGISTRATION RIGHTS AGREEMENT



THIS SECURITY SHALL BE ENTITLED TO THE BENEFITS OF THAT CERTAIN REGISTRATION RIGHTS AGREEMENT,
DATED JANUARY 5, 2007, AMONG TERREMARK WORLDWIDE, INC., CREDIT SUISSE INTERNATIONAL AND THE OTHER
PARTIES NAMED THEREIN.




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EXHIBIT C




FORM OF NOTICE OF TRANSFER PURSUANT TO REGISTRATION STATEMENT




Terremark Worldwide, Inc.

2601 South Bayshore Drive

Miami, Florida 33133

Attn: Chief Financial Officer




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

10161 Centurion Parkway

Jacksonville, Florida 32256

Attention: Corporate Trust Administration





			
	     Re:	 	Terremark Worldwide, Inc. (the “Company”) 0.50% Senior Subordinated
Convertible Notes due 2009 (the “Securities”)





Ladies and Gentlemen:




          Please be advised that                      has transferred $                      aggregate principal amount of
the Securities and                     shares of the Common Stock, $0.001 par value per share, of the Company
issued on conversion of the Securities (“Stock”) pursuant to an effective Registration Statement on
Form ___(File No. 333-___).




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




Very truly yours,




	 	 	 
	 

(Name)

	 	 







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EXHIBIT D




FORM OF CERTIFICATE

TERREMARK WORLDWIDE, INC.

INCUMBENCY CERTIFICATE




          The undersigned, ___, being the ___of Terremark Worldwide, Inc. (the
“Company”) does hereby certify that the individuals listed below are qualified and acting
officers of the Company as set forth in the right column opposite their respective names and the
signatures appearing in the extreme right column opposite the name of each such officer is a true
specimen of the genuine signature of such officer and such individuals have the authority to
execute documents to be delivered to, or upon the request of, The Bank of New York Trust Company,
N.A., as Trustee under the Indenture dated as of January 5, 2007, by and between the Company and
The Bank of New York Trust Company, N.A..




	 	 	 	 	 
	Name	 	Title	 	Signature
	 
	 	 	 	 
	 


	 	 

	 	 

	 


	 	 

	 	 

	 


	 	 

	 	 







     IN WITNESS WHEREOF, the undersigned has duly executed and delivered this Certificate as of the
___day of ___, 20___.



	 	 	 
	 

	 	 
	 

	 	Name:
	 

	 	Title:






     The above is the true signature of the above-named                      of the Company.



	 	 	 
	 

	 	 
	 

	 	Name:
	 

	 	Title:







D-1