EX-4.1






Exhibit 4.1




Sipex Corporation, Issuer




Wells Fargo Bank, National Association,




as Trustee




INDENTURE




Dated as of May 16, 2006




5.5% Convertible Senior Notes due 2026




1




CROSS-REFERENCE TABLE*




Provisions of Trust Indenture Act of 1939 and Indenture, dated as of May 16, 2006,
between Sipex Corporation and Wells Fargo Bank, National Association, a national banking
association organized and in good standing under the laws of the United States, as
Trustee, providing for the 5.5% Convertible Senior Notes due 2026:



	 	 	 	 	 
	Section of the Act	 	Section of Indenture
	310(a)(1) and (2)
	 	 	8.9	 
	310(a)(3) and (4)
	 	 	N.A.**	 
	310(b)
	 	8.8 and 8.10(b) and (d)
	310(c)
	 	 	N.A.	 
	311(a)
	 	 	8.13	 
	311(b)
	 	 	8.13	 
	311(c)
	 	 	N.A.	 
	312(a)
	 	6.1 and 6.2(a)
	312(b)
	 	 	6.2	(b)
	312(c)
	 	 	6.2	(c)
	313(a)
	 	 	6.3	(a)
	313(b)(1)
	 	 	N.A.	 
	313(b)(2)
	 	 	6.3	(a)
	313(c)
	 	 	6.3	(a)
	313(d)
	 	 	6.3	(b)
	314(a)
	 	 	6.4	 
	314(b)
	 	 	17.4	 
	314(c)(1) and (2)
	 	 	18.5	 
	314(c)(3)
	 	 	17.6.	 
	314(d)
	 	 	N.A.	 
	314(e)
	 	 	18.5	 
	314(f)
	 	 	N.A.	 
	315(a), (c) and (d)
	 	 	8.1	 
	315(b)
	 	 	7.8	 
	315(e)
	 	 	7.9	 
	316(a)(1)
	 	 	7.7	 
	316(a)(2)
	 	Not required

	316(a) (last sentence).
	 	 	9.4	 
	316(b)
	 	 	11.2	 






2




TABLE OF CONTENTS




Page




	 	 	 	 	 	 	 	 	 	 	 	 	 
	ARTICLE I DEFINITIONS	 	1	 	 
	Section 1.1	 	Definitions	 	1	 	 
	Section 1.2	 	Other Definitions	 	10	 	 
	ARTICLE II ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES	 	11
	Section 2.1	 	Designation, Amount and Issue of Notes	 	11	 	 	 	 
	Section 2.2
	 	Form of Notes
	 	 	12	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 2.3
	 	Date and Denomination of Notes; Payments of Interest
	 	 	13	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 2.4
	 	Execution of Notes
	 	 	15	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 







	 	 	 	Section 2.5 Exchange and Registration of Transfer of Notes; Restrictions on
Transfer 16	 





	 	 	 	 	 	 	 	 	 	 	 	 	 
	Section 2.6
	 	Mutilated, Destroyed, Lost or Stolen Notes
	 	 	29	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 2.7
	 	Temporary Notes
	 	 	30	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 2.8
	 	Cancellation of Notes Paid, Etc.
	 	 	31	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 2.9
	 	CUSIPNumbers
	 	 	31	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	ARTICLE III OPTIONAL REDEMPTION OF NOTES
	 	 	32	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Section 3.1
	 	Redemption Price
	 	 	32	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 3.2
	 	Notice of Redemption; Selection of Notes
	 	 	32	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 3.3
	 	Payment of Notes Called for Redemption
	 	 	33	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 3.4
	 	Conversion Arrangement on Call for Redemption
	 	 	34	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	ARTICLE IV [RESERVED]
	 	 	 	 	 	 	35	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE V PARTICULAR COVENANTS OF THE COMPANY
	 	 	35	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Section 5.1
	 	Payment of Principal, Premium and Interest
	 	 	35	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 5.2
	 	Maintenance of Office or Agency
	 	 	35	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 5.3
	 	Appointments to Fill Vacancies in Trustee’s Office
	 	 	36	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 5.4
	 	Provisions as to Paying Agent
	 	 	36	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 5.5
	 	Existence
	 	 	37	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 5.6
	 	Information Requirement
	 	 	38	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 5.7
	 	Stay, Extension and Usury Laws
	 	 	38	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 5.8
	 	Compliance Certificate
	 	 	38	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 5.9
	 	Further Instruments and Acts
	 	 	39	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 5.10
	 	Notice of Certain Events
	 	 	39	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 5.11
	 	Incurrence of Indebtedness
	 	 	39	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 5.12
	 	Existence of Liens
	 	 	39	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 5.13
	 	Restricted Payments
	 	 	40	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	ARTICLE VI NOTEHOLDERS’ LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE
	 	 	 	 	 	 	40	 
	 
	 	 	 	 
	Section 6.1
	 	Noteholders Lists
	 	 	40	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 6.2
	 	Preservation and Disclosure of Lists
	 	 	40	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 6.3
	 	Reports by Trustee
	 	 	41	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 6.4
	 	Reports by Company
	 	 	41	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	ARTICLE VII DEFAULTS AND REMEDIES
	 	 	 	 	 	 	42	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Section 7.1
	 	Events of Default
	 	 	42	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 7.2
	 	Payments of Notes on Default; Suit Therefor
	 	 	46	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 7.3
	 	Application of Monies Collected by Trustee
	 	 	47	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 7.4
	 	Proceedings by Noteholder
	 	 	48	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 7.5
	 	Proceedings by Trustee
	 	 	48	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Section 7.6
	 	Remedies Cumulative and Continuing
	 	 	49	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 







	 	 	 	Section 7.7 Direction of Proceedings and Waiver of Defaults by 66 2/3% of
Noteholders 49	 





	 	 	 	 	 	 	 	 	 
	Section 7.8
	 	Notice of Defaults
	 	 	50	 
	 
	 	 	 	 	 	 	 	 
	Section 7.9
	 	Undertaking to Pay Costs
	 	 	50	 
	 
	 	 	 	 	 	 	 	 
	Section 7.10
	 	Delay or Omission Not Waiver
	 	 	50	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE VIII CONCERNING THE TRUSTEE
	 	 	51	 
	 
	 	 	 	 
	Section 8.1
	 	Duties and Responsibilities of Trustee
	 	 	51	 
	 
	 	 	 	 	 	 	 	 
	Section 8.2
	 	Reliance on Documents, Opinions, Etc.
	 	 	52	 
	 
	 	 	 	 	 	 	 	 
	Section 8.3
	 	No Responsibility for Recitals, Etc.
	 	 	53	 
	 
	 	 	 	 	 	 	 	 







	 	 	 	Section 8.4 Trustee, Paying Agents, Conversion Agents or Note Registrar
May Own Notes 54	 





	 	 	 	 	 	 	 	 	 
	Section 8.5
	 	Monies to be Held in Trust
	 	 	54	 
	 
	 	 	 	 	 	 	 	 
	Section 8.6
	 	Compensation and Expenses of Trustee
	 	 	54	 
	 
	 	 	 	 	 	 	 	 
	Section 8.7
	 	Officer’s Certificate as Evidence
	 	 	55	 
	 
	 	 	 	 	 	 	 	 
	Section 8.8
	 	Conflicting Interests of Trustee
	 	 	55	 
	 
	 	 	 	 	 	 	 	 
	Section 8.9
	 	Eligibility of Trustee
	 	 	55	 
	 
	 	 	 	 	 	 	 	 
	Section 8.10
	 	Resignation or Removal of Trustee
	 	 	55	 
	 
	 	 	 	 	 	 	 	 
	Section 8.11
	 	Acceptance by Successor Trustee
	 	 	57	 
	 
	 	 	 	 	 	 	 	 
	Section 8.12
	 	Succession by Merger, Etc.
	 	 	57	 
	 
	 	 	 	 	 	 	 	 
	Section 8.13
	 	Limitation on Rights of Trustee as Creditor
	 	 	58	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE IX CONCERNING THE NOTEHOLDERS
	 	 	58	 
	 
	 	 	 	 
	Section 9.1
	 	Action by Noteholders
	 	 	58	 
	 
	 	 	 	 	 	 	 	 
	Section 9.2
	 	Proof of Execution by Noteholders
	 	 	58	 
	 
	 	 	 	 	 	 	 	 
	Section 9.3
	 	Who Are Deemed Absolute Owners
	 	 	59	 
	 
	 	 	 	 	 	 	 	 
	Section 9.4
	 	Company-Owned Notes Disregarded
	 	 	59	 
	 
	 	 	 	 	 	 	 	 
	Section 9.5
	 	Revocation of Consents; Future Holders Bound
	 	 	59	 
	 
	 	 	 	 	 	 	 	 
	Section 9.6
	 	Communications by Holders with Other Holders
	 	 	60	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE X NOTEHOLDERS’ MEETINGS
	 	 	 	 	 	 	60	 
	 
	 	 	 	 
	Section 10.1
	 	Purpose of Meetings
	 	 	60	 
	 
	 	 	 	 	 	 	 	 
	Section 10.2
	 	Call of Meetings by Trustee
	 	 	60	 
	 
	 	 	 	 	 	 	 	 
	Section 10.3
	 	Call of Meetings by Company or Noteholders
	 	 	61	 
	 
	 	 	 	 	 	 	 	 
	Section 10.4
	 	Qualifications for Voting
	 	 	61	 
	 
	 	 	 	 	 	 	 	 
	Section 10.5
	 	Regulations
	 	 	61	 
	 
	 	 	 	 	 	 	 	 
	Section 10.6
	 	Voting
	 	 	62	 
	 
	 	 	 	 	 	 	 	 
	Section 10.7
	 	No Delay of Rights by Meeting
	 	 	62	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE XI AMENDMENTS; SUPPLEMENTAL INDENTURES
	 	 	63	 
	 
	 	 	 	 
	Section 11.1
	 	Amendments; Supplemental Indentures without Consent of Noteholders63
	 	 	 	 
	 	 	 

	Section 11.2
	 	Amendments; Supplemental Indentures with Consent of Noteholders
	 	 	64	 
	 
	 	 	 	 	 	 	 	 
	Section 11.3
	 	Effect of Amendments and Supplemental Indentures
	 	 	65	 
	 
	 	 	 	 	 	 	 	 
	Section 11.4
	 	Notation on Notes
	 	 	65	 
	 
	 	 	 	 	 	 	 	 







	 	 	 	Section 11.5 Evidence of Compliance of Amendment or Supplemental Indenture
to be Furnished to Trustee 65	 





	 	 	 	 	 	 	 	 	 
	ARTICLE XII CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
	 	 	66	 
	 
	 	 	 	 
	Section 12.1
	 	Company May Consolidate, Etc.
	 	 	66	 
	 
	 	 	 	 	 	 	 	 
	Section 12.2
	 	Successor Entity to be Substituted
	 	 	67	 
	 
	 	 	 	 	 	 	 	 
	Section 12.3
	 	Opinion of Counsel to be Given Trustee
	 	 	67	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE XIII SATISFACTION AND DISCHARGE OF INDENTURE
	 	 	67	 
	 
	 	 	 	 
	Section 13.1
	 	Discharge of Indenture
	 	 	67	 
	 
	 	 	 	 	 	 	 	 
	Section 13.2
	 	Deposited Monies to be Held in Trust by Trustee
	 	 	68	 
	 
	 	 	 	 	 	 	 	 
	Section 13.3
	 	Paying Agent to Repay Monies Held
	 	 	68	 
	 
	 	 	 	 	 	 	 	 
	Section 13.4
	 	Return of Unclaimed Monies
	 	 	68	 
	 
	 	 	 	 	 	 	 	 
	Section 13.5
	 	Reinstatement
	 	 	69	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE XIV NO RECOURSE AGAINST OTHERS
	 	 	 	 	 	 	69	 
	 
	 	 	 	 
	Section 14.1
	 	Indenture and Notes Solely Corporate Obligations
	 	 	69	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE XV CONVERSION OF NOTES
	 	 	 	 	 	 	69	 
	 
	 	 	 	 
	Section 15.1
	 	Right to Convert
	 	 	69	 
	 
	 	 	 	 	 	 	 	 







	 	 	 	Section 15.2 Exercise of Conversion Privilege; Issuance of Common Stock on
Conversion 70	 





	 	 	 	 	 	 	 	 	 
	Section 15.3	 	Company Right to Force Automatic Conversion	 	74
	Section 15.4	 	Cash Payments in Lieu of Fractional Shares	 	75
	Section 15.5
	 	Conversion Price
	 	 	76	 
	 
	 	 	 	 	 	 	 	 
	Section 15.6
	 	Adjustment of Conversion Price
	 	 	76	 
	 
	 	 	 	 	 	 	 	 
	Section 15.7
	 	Effect of Reclassification, Consolidation, Merger or Sale
	 	 	84	 
	 
	 	 	 	 	 	 	 	 
	Section 15.8
	 	Taxes on Shares Issued
	 	 	85	 
	 
	 	 	 	 	 	 	 	 







	 	 	 	Section 15.9 Reservation of Shares; Shares to be Fully Paid; Listing of
Common Stock 85	 





	 	 	 	 	 	 	 	 	 
	Section 15.10
	 	Responsibility of Trustee
	 	 	86	 
	 
	 	 	 	 	 	 	 	 
	Section 15.11
	 	Notice to Holders Prior to Certain Actions
	 	 	87	 
	 
	 	 	 	 	 	 	 	 
	Section 15.12
	 	Holder Not Deemed a Shareholder
	 	 	88	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE XVI REPURCHASE RIGHT
	 	 	 	 	 	 	88	 
	 
	 	 	 	 
	Section 16.1
	 	Repurchase Right
	 	 	88	 
	 
	 	 	 	 	 	 	 	 
	Section 16.2
	 	Notices; Method of Exercising Repurchase Right, Etc.
	 	 	89	 
	 
	 	 	 	 	 	 	 	 
	Section 16.3
	 	Certain Definitions
	 	 	91	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE XVII MISCELLANEOUS PROVISIONS
	 	 	92	 
	 
	 	 	 	 
	Section 17.1
	 	Provisions Binding on Company’s Successors
	 	 	92	 
	 
	 	 	 	 	 	 	 	 
	Section 17.2
	 	Official Acts by Successor Corporation
	 	 	93	 
	 
	 	 	 	 	 	 	 	 
	Section 17.3
	 	Addresses for Notices, Etc.
	 	 	93	 
	 
	 	 	 	 	 	 	 	 
	Section 17.4
	 	Governing Law; Jurisdiction; Jury Trial
	 	 	94	 
	 
	 	 	 	 	 	 	 	 







	 	 	 	Section 17.5 Evidence of Compliance with Conditions Precedent; Certificates
to Trustee 94	 





	 	 	 	 	 	 	 	 	 
	Section 17.6
	 	Legal Holidays
	 	 	95	 
	 
	 	 	 	 	 	 	 	 
	Section 17.7
	 	Trust Indenture Act
	 	 	95	 
	 
	 	 	 	 	 	 	 	 
	Section 17.8
	 	Benefits of Indenture
	 	 	95	 
	 
	 	 	 	 	 	 	 	 
	Section 17.9
	 	Table of Contents, Headings, Etc.
	 	 	95	 
	 
	 	 	 	 	 	 	 	 
	Section 17.10
	 	Authenticating Agent
	 	 	96	 
	 
	 	 	 	 	 	 	 	 
	Section 17.11
	 	Execution in Counterparts
	 	 	96	 
	 
	 	 	 	 	 	 	 	 
	Section 17.12
	 	Dispute Resolution.
	 	 	96	 
	 
	 	 	 	 	 	 	 	 
	Section 17.13
	 	No Adverse Interpretation of Other Agreements
	 	 	97	 
	 
	 	 	 	 	 	 	 	 
	Section 17.14
	 	Severability
	 	 	97	 
	 
	 	 	 	 	 	 	 	 
	EXHIBIT A
	 	Form of 5.5% Convertible Senior Note due 2026
	 	 	 	 
	EXHIBIT B
	 	Form of Conversion Notice
	 	 	 	 
	EXHIBIT C
	 	Form of Option to Elect Repayment Upon a Repurchase Date
	 	 	 	 
	EXHIBIT D
	 	Form of Certificate of Transfer
	 	 	 	 
	EXHIBIT E
	 	Form of Certificate of Exchange
	 	 	 	 
	EXHIBIT F
	 	Form of Transfer Letter of Representations
	 	 	 	 






3




INDENTURE dated as of May 16, 2006 between Sipex Corporation, a Delaware
corporation (hereinafter sometimes called the “Company”, as more fully set forth in Section 1.1),
and Wells Fargo Bank, National Association, a national banking association organized and in good
standing under the laws of the United States, as trustee (hereinafter sometimes called the
“Trustee”, as more fully set forth in Section 1.1).



W I T N E S S E T H:




WHEREAS, for its lawful corporate purposes, the Company has duly authorized the issue of its
5.5% Convertible Senior Notes due 2026 (hereinafter sometimes called the “Notes”), initially in an
aggregate principal amount not to exceed Thirty Million United States Dollars ($30,000,000) and to
provide the terms and conditions upon which the Notes are to be authenticated, issued and
delivered, the Company has duly authorized the execution and delivery of this Indenture; and



WHEREAS, the Notes, the certificate of authentication to be borne by the Notes, a form of
assignment, a form of option to elect repayment upon a Repurchase Event, a form of option to elect
repayment on a Repurchase Date (as defined herein), and a form of conversion notice and
transfer to be borne by the Notes are to be substantially in the forms hereinafter provided for;
and



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



NOW, THEREFORE, THIS INDENTURE WITNESSETH:



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



ARTICLE I




DEFINITIONS




Section 1.1 Definitions



144A Global Note: The term “144A Global Note” means the Global Note substantially in
the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement
Legend and deposited with or on behalf of, and registered in the name of, the Depositary or its
nominee that will be issued in a denomination equal to the outstanding principal amount of the
Notes sold in reliance on Rule 144A.



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



Applicable Procedures: The term “Applicable Procedures” shall mean, with respect to
any transfer or exchange of beneficial ownership interests in a Global Note, the rules and
procedures of the Depositary that are applicable to such transfer or exchange.



Average Daily Volume: The term “Average Daily Volume” shall mean the average of the
amount determined for each Trade Day in the Measurement Period equal to the daily trading volume of
the Company’s Common Stock on the Principal Market multiplied by the Average Price of the Common
Stock for such Trading Day.



Board of Directors: The term “Board of Directors” shall mean the Board of Directors
of the Company or a committee of such Board of Directors duly authorized to act for it hereunder
(to the extent permitted by applicable law).



Board Resolution: The term “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.



Business Day: The term “Business Day” means each Monday, Tuesday, Wednesday, Thursday
and Friday which is not a day on which the banking institutions in the City of New York or the city
in which the Corporate Trust Office is located are authorized or obligated by law or executive
order to close or be closed.



Close of business: The term “close of business” means 5 p.m. (New York City time).



Commission: The term “Commission” shall mean the Securities and Exchange Commission.



Common Stock: The term “Common Stock” shall mean any stock of any class of the
Company which has no preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding up of the Company, which is not
subject to redemption by the Company and which entitles the holder thereof to vote generally for
the election of directors. Subject to the provisions of Section 15.6, however, shares issuable on
conversion of Notes shall include only shares of the class designated as common stock of the
Company at the date of this Indenture or shares of any class or classes resulting from any
reclassification or reclassifications thereof and which have no preference in respect of dividends
or of amounts payable in the event of any voluntary or involuntary liquidation, dissolution or
winding up of the Company and which are not subject to redemption by the Company; provided
that if at any time there shall be more than one such resulting class, the shares of each such
class then so issuable shall be substantially in the proportion which the total number of shares of
such class resulting from all such reclassifications bears to the total number of shares of all
such classes resulting from all such reclassifications.



Company: The term “Company” shall mean Sipex Corporation, a Delaware corporation, and
subject to the provisions of Article XII, shall include its successors and assigns.



Contingent Obligation: The term “Contingent Obligation” means, as to any Person, any
liability, contingent or otherwise, of that Person with respect to any indebtedness, lease,
dividend or other obligation of another Person if the primary purpose or intent of the Person
incurring such liability, or the primary effect thereof, is to provide assurance to the obligee of
such liability that such liability will be paid or discharged, or that any agreements relating
thereto will be complied with, or that the holders of such liability will be protected (in whole or
in part) against loss with respect thereto.



Conversion Shares: The term “Conversion Shares” means all shares of Common Stock into
which the Notes are convertible pursuant to Article XV of this Indenture.



Corporate Trust Office: The term “Corporate Trust Office,” or other similar term,
shall mean the office of the Trustee at which at any particular time its corporate trust business
shall be principally administered, which office is, at the date as of which this Indenture is
dated, located at 707 Wilshire Blvd., 17th Floor, Los Angeles, CA 90017, Attention:
Corporate Trust Services.



Custodian: The term “Custodian” shall mean the Trustee, as custodian with respect to
the Notes in global form, or any successor entity thereto.



Debt Limitation: The term “Debt Limitation” shall be defined to mean Indebtedness in
an aggregate principal amount not to exceed $7,500,000, which shall include the principal amount
outstanding under that certain Loan and Security Agreement, dated as of July 21, 2005 by and
between the Company and Silicon Valley Bank, as amended from time to time.



Default: The term “default” shall mean any event that is, or after notice or passage
of time, or both, would be, an Event of Default.



Definitive Note: The term “Definitive Note” shall mean a certificated Note registered
in the name of the holder thereof and issued in accordance with Section 2.5, substantially in the
form of Exhibit A hereto except that such Note shall not bear the Global Note Legend and
shall not have the “Schedule of Exchanges of Interests in the Global Note” attached thereto.



Depositary: The term “Depositary” shall mean, with respect to the Notes issuable or
issued in whole or in part in global form, The Depository Trust Company, its nominees, and their
respective successors.



Eligible Market: The term “Eligible Market” means the Principal Market.



Equity Conditions: The term “Equity Conditions” shall means that each of the
following conditions is satisfied: (i) on each day during the period beginning sixty (60) days
prior to the applicable date of determination and ending on and including the applicable date of
determination (the “Equity Conditions Measuring Period”), either (x) the Registration Statement
filed pursuant to the Registration Rights Agreement shall be effective and available for the resale
of all remaining Registrable Securities in accordance with the terms of the Registration Rights
Agreement and there shall not have been any Grace Periods (as defined in the Registration Rights
Agreement) except any Grace Periods incurred in connection with any amendments required in
connection updating the Company’s Registration Statement on Form S-1 to include information set
forth in the Company’s Exchange Act Reports or (y) all shares of Common Stock issuable upon
conversion of the Notes and exercise of the Warrants shall be eligible for resale by the holder
without restriction and without the need for registration under any applicable federal or state
securities laws; (ii) on each day during the Equity Conditions Measuring Period, the Common Stock
is designated for quotation on the Principal Market and shall not have been suspended from trading
on such exchange or market (other than suspensions of not more than two days and occurring prior to
the applicable date of determination due to business announcements by the Company) nor shall
delisting or suspension by such exchange or market been threatened or pending either (A) in writing
by such exchange or market or (B) by falling below the minimum listing maintenance requirements of
such exchange or market; (iii) during the three (3) month period ending on and including the date
immediately preceding the applicable date of determination, the Company shall have delivered
Conversion Shares upon conversion of the Notes and Warrant Shares upon exercise of the Warrants to
the holders within the time periods required by the Indenture or the Warrant Agreement, as the case
may be; (iv) any applicable shares of Common Stock to be issued in connection with the event
requiring determination may be issued in full without violating the provisions of this Indenture
and the rules or regulations of the Principal Market; (v) during the Equity Conditions Measuring
Period, the Company shall not have failed to timely make any payments within five (5) Business Days
of when such payment is due pursuant to any Transaction Document; (vi) during the Equity Conditions
Measuring Period, there shall not have occurred an Event of Default within the time periods
required by the Indenture; (vii) the Company shall have no knowledge of any fact that would cause
(x) the Registration Statements required pursuant to the Registration Rights Agreement not to be
effective and available for the resale of all remaining Registrable Securities in accordance with
the terms of the Registration Rights Agreement or (y) any shares of Common Stock issuable upon
conversion of the Notes and shares of Common Stock issuable upon exercise of the Warrants not to be
eligible for sale without restriction pursuant to Rule 144(k) and any applicable state securities
laws; and (viii) the Company otherwise shall have been in material compliance with and shall not
have breached any material provision, covenant, representation or warranty of any Transaction
Document.



Equity Conditions Measuring Period: The term “Equity Conditions Measuring Period”
shall have the meaning set forth in the definition of Equity Conditions.



Equity Interests: The term “Equity Interests” shall mean capital stock or warrants,
options or other rights to subscribe for, acquire or receive capital stock (but excluding any debt
security which is convertible into, or exchangeable for, capital stock).



Event of Default: The term “Event of Default” shall mean any event specified in
Section 7.1, continued for the period of time, if any, and after the giving of notice, if any,
therein designated.



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



GAAP: The term “GAAP” means generally accepted accounting principles in the United
States as in effect on the date of this Indenture, applied on a consistent basis.



Global Notes: The term “Global Notes” shall mean, individually and collectively, each
of the Restricted Global Notes and the Unrestricted Global Notes, issued in accordance with Section
2.2, 2.5(c)(iv) or 2.5(e)(ii).



Global Note Legend: The term “Global Note Legend” shall mean the legend set forth in
Section 2.5(h)(iii), which is required to be placed on all Global Notes issued under this
Indenture.



IAI Global Note: The term “IAI Global Note” shall mean the Global Note substantially
in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement
Legend and deposited with or on behalf of and registered in the name of the Depositary or its
nominee that shall be issued in a denomination equal to the outstanding principal amount of the
Notes held by Institutional Accredited Investors or Individual Accredited Investors.



Indebtedness: The term “Indebtedness” means, as to any Person all indebtedness for
borrowed money, whether or not a Contingent Obligation.



Indenture: The term “Indenture” shall mean this instrument as originally executed or,
if amended or supplemented as herein provided, as so amended or supplemented.



Individual Accredited Investor: The term “Individual Accredited Investor” shall mean
an individual “accredited investor” as defined in Rule 501(a) (5) or (6) of Regulation D under the
Securities Act.



Indirect Participant: The term “Indirect Participant” shall mean a Person who holds a
beneficial interest in a Global Note through a Participant.



Issue Date: The term “Issue Date” shall mean May 16, 2006.



Institutional Accredited Investor: The term “Institutional Accredited Investor” shall
mean an institutional “accredited investor” as such term is defined in Rule 501(a)(1), (2), (3) or
(7) under the Securities Act or any entity in which all of the equity owners are accredited
investors within the meaning of Rule 501(a)(1), (2), (3), (5), (6) or (7) under the Securities Act.



Liquidated Damages: The term “Liquidated Damages” means all liquidated damages then
owing pursuant to Section 2(f) of the Registration Rights Agreement.



Note or Notes: The terms “Note” or “Notes” shall mean any Note or Notes, as the case
may be, authenticated and delivered under this Indenture.



Noteholder or holder: The terms “Noteholder” or “holder” as applied to any Note, or
other similar terms (but excluding the term “beneficial holder”), shall mean any Person in whose
name at the time a particular Note is registered on the Note Register.



Officer’s Certificate: The term “Officer’s Certificate”, when used with respect to
the Company, shall mean a certificate signed by one of the President, the Chief Executive Officer,
Chief Financial Officer, Executive or Senior Vice President or any Vice President, that is
delivered to the Trustee. Each such certificate shall include the statements provided for in
Section 17.5 if and to the extent required by the provisions of such Section.



Opinion of Counsel: The term “Opinion of Counsel” shall mean an opinion in writing
signed by legal counsel, who may be an employee of or counsel to the Company, which is delivered to
the Trustee. Each such opinion shall include the statements provided for in Section 17.5 if and to
the extent required by the provisions of such Section.



Outstanding: The term “outstanding,” when used with reference to Notes, shall,
subject to the provisions of Section 9.4, mean, as of any particular time, all Notes authenticated
and delivered by the Trustee under this Indenture, except:




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




(b) Notes, or portions thereof, for the payment, or redemption of which monies in the
necessary amount shall have been deposited in trust with the Trustee or with any paying
agent (other than the Company) or shall have been set aside and segregated in trust by the
Company (if the Company shall act as its own paying agent); provided that if such
Notes are to be redeemed, as the case may be, prior to the maturity thereof, notice of such
redemption shall have been given as provided in Section 3.2, or provision satisfactory to
the Trustee shall have been made for giving such notice;




(c) Notes paid pursuant to Section 2.6 and Notes in lieu of which, or in substitution
for which, other Notes shall have been authenticated and delivered pursuant to the terms of
Section 2.6 unless proof satisfactory to the Trustee is presented that any such Notes are
held by bona fide holders in due course; and




(d) Notes converted into Common Stock pursuant to Article XV and Notes deemed not
outstanding pursuant to Section 3.2.



Participant: The term “Participant” shall mean, with respect to the Depositary, a
Person who has an account with the Depositary.



Permitted Indebtedness: The term “Permitted Indebtedness” means (A) Indebtedness with
respect to that certain Loan and Security Agreement, dated as of July 21, 2005 by and between the
Company and Silicon Valley Bank, as amended from time to time, in an amount not to exceed the Debt
Limitation, taking into account all other Indebtedness, other than as set forth in (b) through (f)
below, (B) the incurrence by the Company of Indebtedness represented by mortgage financings,
capital leases or purchase money obligations, in each case incurred for the purpose of financing
all or any part of the purchase price or cost of construction of improvement of real or personal
property, including, without limitation, equipment leases, used in the business of the Company, in
an aggregate amount not to exceed Three Million United States Dollars ($3,000,000) per fiscal year,
(C) Indebtedness to trade creditors incurred in the ordinary course of business and not outstanding
for more than 120 days after the date such payable was created, (D) Indebtedness existing on the
date hereof and set forth on Schedule 3(z) to the Securities Purchase Agreement, (E) Indebtedness
which may be deemed to exist pursuant to (i) any statutory, appeal or similar obligations incurred
in the ordinary course of business, or (ii) any guaranties, performance, surety or similar
obligations in an aggregate amount not to exceed Six Million United States Dollars ($6,000,000) at
any given time, and (F) provided that with respect to such extensions, refinancings and renewals of
items (B)-(E) above the principal amount is not increased or the terms modified to impose more
burdensome terms upon the Company or its Subsidiary, as the case may be.



Permitted Liens: The term “Permitted Liens” means (a) existing Liens described on
Schedule 3(u) to the Securities Purchase Agreement and any extensions, renewals or refinancings of
any Indebtedness secured by such Liens; (b) encumbrances consisting of easements, zoning
restrictions or other restrictions on the use of real property that do not (individually or in the
aggregate) materially detract from the value of the real property encumbered thereby or materially
impair the ability of the Company or such Subsidiary to use such real property in its business; (c)
Liens for taxes, assessments or other governmental charges (but excluding environmental Liens or
Liens under The Employee Retirement Income Security Act of 1974) that are not delinquent or which
are being contested in good faith and for which adequate reserves have been established in
accordance with GAAP; (d) contractual or statutory Liens of mechanics, materialmen, warehousemen,
carriers, landlords or other similar Liens securing obligations that are not overdue or are being
contested in good faith by appropriate proceedings diligently pursued and for which adequate
reserves have been established in accordance with GAAP and are incurred in the ordinary course of
business; (e) Liens resulting from deposits to secure payments of worker’s compensation,
unemployment insurance or other social security programs or to secure the performance of tenders,
statutory obligations, leases, insurance contracts, surety and appeal bonds, bids and other
contracts incurred in the ordinary course of business (other than for payment of Indebtedness); (f)
Liens for purchase money obligations and Liens securing capital lease obligations; provided
that any such Lien encumbers only the property so purchased or leased and the products, proceeds
(including insurance proceeds), accessions, replacements, substitutions and improvements thereto;
(g) any attachment or judgment Lien not constituting an Event of Default; (h) any interest or title
of a licensor, lessor or sublessor under any license or lease and any interest or title of a
licensee, lessee or sublessee under any license, cross-license or lease in any event entered into
in the ordinary course of business and not otherwise prohibited by the terms hereof; (i) Liens
against equipment arising from precautionary UCC financing statement filings regarding operating
leases entered into by such Person in the ordinary course of business; (j) Liens in favor of
financial institutions arising as a matter of law or otherwise and encumbering deposits of cash or
financial assets (including the right of set-off) held by such financial institutions in the
ordinary course of business in connection with deposit or securities accounts, provided
that no such account is (x) a dedicated cash collateral account and/or is subject to restrictions
against access in excess of those set forth by regulations promulgated by the Federal Reserve Board
and (y) intended by the Company or any Subsidiary to provide collateral to the applicable financial
institution; (k) Liens (including statutory and common law liens) in or against goods, documents or
instruments, including proceeds (including insurance proceeds), products, accessions, substitutions
and replacements related thereto, related to or arising out of commercial or documentary letter of
credit transactions; (l) Liens in favor of customs and revenue authorities arising as a matter of
law to secure payment of customs duties incurred in the ordinary course of business in connection
with the importation of goods, which customs duties are not overdue; and (m) Liens securing
Indebtedness in an aggregate principal amount outstanding at any time not exceeding One Million
United States Dollars ($1,000,000).



Permitted Subordinated Indebtedness: The term “Permitted Subordinated Indebtedness”
shall mean that Permitted Indebtedness the payment of which is subordinated to the Note.



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



Predecessor Note: The term “Predecessor Note” of any particular Note shall mean every
previous Note evidencing all or a portion of the same debt as that evidenced by such particular
Note; and, for the purposes of this definition, any Note authenticated and delivered under
Section 2.6 in lieu of a lost, destroyed or stolen Note shall be deemed to evidence the same debt
as the lost, destroyed or stolen Note that it replaces.



Private Placement Legend: The term “Private Placement Legend” shall mean the legend
set forth in Section 2.5(h)(i) to be placed on all Notes issued under this Indenture except where
otherwise permitted by the provisions of this Indenture.



Principal Market: The term “Principal Market” shall have the meaning assigned thereto
in the Securities Purchase Agreement.



QIB: The term “QIB” shall mean a “qualified institutional buyer” as defined in Rule
144A.



Registration Rights Agreement: The term “Registration Rights Agreement” means that
certain Registration Rights Agreement, dated as of May 16, 2006, among the Company and
the Buyers as defined therein, as such agreement may be amended from time to time.



Responsible Officer: The term “Responsible Officer” shall mean, when used with
respect to the Trustee, any officer within the corporate trust department of the Trustee, including
any vice president, assistant vice president, assistant 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 Definitive Note: The term “Restricted Definitive Note” means a Definitive
Note bearing the Private Placement Legend.



Restricted Global Note: The term “Restricted Global Note” shall mean a permanent
Global Note substantially in the form of Exhibit A attached hereto that bears the Global
Note Legend and that has the “Schedule of Exchanges of Interests in the Global Note” attached
thereto, and that is deposited with or on behalf of and registered in the name of the Depositary,
that bears the Private Placement Legend.



Rule 144: The term “Rule 144” shall mean Rule 144 promulgated under the Securities
Act.



Rule 144A: The term “Rule 144A” shall mean Rule 144A promulgated under the Securities
Act.



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



Securities Purchase Agreement: The term “Securities Purchase Agreement” means that
certain Securities Purchase Agreement, dated as of May 16, 2006, among the Company and
the parties listed on the Schedule of Buyers attached thereto as Exhibit A, as such agreement may
be amended from time to time.



Share Delivery Damages: The term “Share Delivery Damages” shall have the meaning set
forth in Section 15.2.



Shelf Registration Statement: The term “Shelf Registration Statement” means the Shelf
Registration Statement contemplated by the Registration Rights Agreement.



Significant Subsidiary: The term “Significant Subsidiary” shall have the meaning
assigned to that term in Rule 1-02(w) of Regulation S-X promulgated under the Securities Exchange
Act of 1934, as amended, and shall also mean any Subsidiary, including its subsidiaries, having
liabilities exceeding 10% of the total liabilities of the Company and its Subsidiaries on a
consolidated basis for the most recently completed fiscal year.



Subsidiary: The term “Subsidiary” means a Person more than 50% of the outstanding
voting stock or Equity Interests of which is owned, directly or indirectly, by the Company or by
one or more other Subsidiaries, or by the Company and one or more other Subsidiaries. For the
purposes of this definition, “voting stock” means stock which ordinarily has voting power for the
election of directors, whether at all times or only so long as no senior class of stock has such
voting power by reason of any contingency.



Transaction Documents: The term “Transaction Documents” shall mean the Securities
Purchase Agreement, the Registration Rights Agreement, the Notes, the Warrant Agent Agreement, the
Warrant and the Indenture.



Trust Indenture Act: The term “Trust Indenture Act” shall mean the Trust Indenture
Act of 1939, as amended, as it was in force at the date of execution of this Indenture, except as
provided in Sections 11.3 and 15.7; provided, however, that in the event the Trust
Indenture Act of 1939 is amended after the date hereof, the term “Trust Indenture Act” shall mean,
to the extent required by such amendment, the Trust Indenture Act of 1939 as so amended.



Trustee: The term “Trustee” shall mean Wells Fargo Bank, National Association and its
successors and any entity resulting from or surviving any consolidation or merger to which it or
its successors may be a party and any successor trustee at the time serving as successor trustee
hereunder.



Unrestricted Global Note: The term “Unrestricted Global Note” shall mean a permanent
Global Note substantially in the form of Exhibit A attached hereto that bears the Global
Note Legend and that has the “Schedule of Exchanges of Interests in the Global Note” attached
thereto, and that is deposited with or on behalf of and registered in the name of the Depositary,
that does not bear and is not required to bear the Private Placement Legend.



Unrestricted Definitive Note: The term “Unrestricted Definitive Note” shall mean one
or more Definitive Notes that do not bear and are not required to bear the Private Placement
Legend.



Warrants: The term “Warrants” shall mean the warrants to purchase shares of Common
Stock issued pursuant to the Securities Purchase Agreement and all warrants issued in exchange,
transfer or replacement thereof.



Section 1.2 Other Definitions



	 	 	 	 	 
	 	 	Defined in
	Term	 	Section
	“Additional Securities”
	 	 	15.6	(d)
	“Agent Members”
	 	 	2.2(b) 	 
	“Average Price”
	 	 	15.6	(h)(1)
	“Authentication Order”
	 	 	2.1	 
	“Automatic Conversion Date”
	 	 	15.3	 
	“Change in Control”
	 	 	16.3	(e)
	“Closing Price”
	 	 	15.6	(h)(2)
	“Company Notice”
	 	 	16.2	(a)
	“Continuing Director”
	 	 	16.3	(c)
	“Conversion Date”
	 	 	15.2	 
	“Conversion Notice”
	 	 	15.2	 
	“Conversion Price”
	 	 	15.5	 
	“Current Market Price”
	 	 	15.6	(h)(3)
	“Exchange Act Filing Deadline”
	 	 	2.3	 
	“Exchange Act Reports”
	 	 	2.3	 
	“fair market value”
	 	 	15.6	(h)(5)
	“Interest Payment Date”
	 	 	2.3	 
	“Measurement Period”
	 	 	15.3	 
	“non-electing share”
	 	 	15.7	 
	“Note Register”
	 	 	2.5	(a)
	“Note Registrar”
	 	 	2.5	(a)
	“Principal Market Listing Deadline”
	 	 	2.3	 
	“record date”
	 	 	2.3	 
	“Record Date”
	 	 	15.6	(h)(5)
	“Reference Period”
	 	 	15.6	(d)
	“Repurchase Date”
	 	 	16.1	 
	“Repurchase Event”
	 	 	16.3	(d)
	“Repurchase Price”
	 	 	16.1	 
	“Restricted Securities”
	 	 	2.5	(h)(i)
	“Statutory Exchange”
	 	 	15.7	 
	“Termination of Trading”
	 	 	16.3	(f)
	“Trading Day”
	 	 	15.6	(h)(6)
	“Trigger Event”
	 	 	15.6	(d)
	“Vice President”
	 	 	2.1	 
	“Voting Stock”
	 	 	16.3	(e)






Section 1.3 Rules of Construction



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



ARTICLE II




ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES




Section 2.1 Designation, Amount and Issue of Notes



The Notes shall be designated as “5.5% Convertible Senior Notes due 2026.” Notes not to
exceed the aggregate principal amount of Thirty Million United States Dollars ($30,000,000) upon
the execution of this Indenture, or (except pursuant to Sections 2.5, 2.6, 3.3, 15.2 and 16.2) from
time to time thereafter, may be executed by the Company and delivered to the Trustee for
authentication, and the Trustee shall thereupon authenticate and deliver said Notes upon the
written order of the Company (the “Authentication Order”), signed by the Company’s (a) President,
Chief Executive Officer, Executive or Senior Vice President or any Vice President (whether or not
designated by a number or numbers or word or words added before or after the title, a “Vice
President”) and (b) Chief Financial Officer, Treasurer or Assistant Treasurer or its Secretary or
any Assistant Secretary, without any further action by the Company hereunder provided,
however, that additional Notes may be issued in an unlimited aggregate principal amount so long as
such Notes are executed, delivered or authenticated at a price that would not cause such Notes to
have “original issue discount” within the meaning of Section 1273 of the Internal Revenue Code of
1986, as amended.



Section 2.2 Form of Notes




(a) Notes issued in global form shall be substantially in the form of Exhibit A
attached hereto (including the Global Note Legend thereon and the “Schedule of Exchanges of
Interests in the Global Note” attached thereto), which is incorporated in and made a part of
this Indenture. Notes issued in definitive form shall be substantially in the form of
Exhibit A attached hereto (but without the Global Note Legend thereon and without
the “Schedule of Exchanges of Interests in the Global Note” attached thereto). Each Global
Note shall represent such of the outstanding Notes as shall be specified therein and each
shall provide that it shall represent the aggregate principal amount of outstanding Notes
from time to time endorsed thereon and that the aggregate principal amount of outstanding
Notes represented thereby may from time to time be reduced or increased, as appropriate, to
reflect purchases, conversions and redemptions. Any endorsement of a Global Note to reflect
the amount of any decrease or increase in the aggregate principal amount of outstanding
Notes represented thereby shall be made by the Trustee or the Custodian, at the direction of
the Trustee, in accordance with instructions given by the holder thereof as required by
Section 2.5.




The Trustee’s certificate of authentication to be borne by such Notes shall be
substantially in the form set forth in Exhibit A.




Any of the Notes may have such letters, numbers or other marks of identification and
such notations, legends and endorsements as the officers executing the same may approve
(execution thereof to be conclusive evidence of such approval) and as are not inconsistent
with the provisions of this Indenture, or as may be required to comply with any law or with
any rule or regulation made pursuant thereto or with any rule or regulation of any
securities exchange or automated quotation system on which the Notes may be listed or
designated for issuance, or to conform to usage.




The terms and provisions contained in the form of Note attached as Exhibit A
hereto shall constitute, and are hereby expressly made, a part of this Indenture and to the
extent applicable, the Company and the Trustee, by their execution and delivery of this
Indenture, expressly agree to such terms and provisions and to be bound thereby.




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



Section 2.3 Date and Denomination of Notes; Payments of Interest




(a) The Notes shall be issuable in registered form without coupons in denominations of
One Thousand United States Dollars ($1,000) principal amount and integral multiples thereof.
Every Note shall be dated the date of its authentication, and shall bear interest on the
principal sum outstanding from time to time under the Note, initially at the rate per annum
specified in the title of the form of Note attached as Exhibit A hereto, which rate may be
increased as provided herein, accrued from the most recent date to which interest has been
paid or, if no interest has been paid, the date of issuance of the Note and payable
semi-annually on May 15 and November 15 of each year (each, an “Interest Payment Date”),
commencing November 15, 2006, as specified on the face of the form of Note attached as
Exhibit A hereto.




(b) If by August 15, 2006 (the “Exchange Act Filing Deadline”), the Company has not
filed with the Commission all reports then required to be filed by the Company in accordance
with Section 13 or 15(d) under the Exchange Act (the “Exchange Act Reports”), including,
without limitation, an Annual Report on Form 10-K for the year ended January 1, 2005 and
Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2005, June 30,
2005, September 30, 2005 and March 31, 2006 (the “Exchange Act Filing Condition”), the
then-applicable per annum interest rate of the Notes shall be increased by 1.5% for the
period beginning on August 16, 2006 and ending on the date on which all the Company has made
all such filings with the Commission.




(c) If by December 31, 2006 (the “Principal Market Listing Deadline”), the Common Stock
is not listed for trading on the Principal Market (the “Principal Market Condition”), the
then-applicable per annum interest rate of the Notes shall be increased by 1.5% for the
period beginning on January 1, 2007 and ending on the date on which all the Common Stock is
listed for trading on a Principal Market.




(d) The interest rate on the Notes shall be increased pursuant to this Section 2.3 up
to a maximum of 3% per annum in the event that the Company fails to meet both the Exchange
Act Filing Deadline and the Principal Market Listing Deadline until such time as either the
Company has filed all such Exchange Act Reports or listed the Common Stock on a Principal
Market.




(e) Interest on the Notes shall be deemed to have commenced accruing on May 16,
2006.




(f) The Person in whose name any Note, or portion thereof (or its Predecessor Note) is
registered at the close of business on any record date with respect to any Interest Payment
Date (including any Note that is converted after the record date and on or before the
Interest Payment Date) shall be entitled to receive the interest payable on such Interest
Payment Date notwithstanding the cancellation of such Note upon any transfer, exchange or
conversion subsequent to the record date and on or prior to such Interest Payment Date;
provided that, in the case of any Note, or portion thereof, called for redemption or
converted pursuant to Article III or Article XV on a redemption date or conversion date, as
applicable, or repurchased by the Company pursuant to Article XVI on a Repurchase Date,
during the period from the close of business on the record date to the close of business on
the Business Day next preceding the following Interest Payment Date, interest shall not be
paid to the Person in whose name the Note, or portion thereof, is registered on the close of
business on such record date, and the Company shall have no obligation to pay interest on
such Note or portion thereof except to the extent required to be paid upon such redemption,
conversion or repurchase in accordance with Article III, Article XV or Article XVI.
Interest payable in cash may, at the option of the Company, be paid by check mailed to the
address of such Person on the Note Register; provided that, with respect to any
holder of Notes with an aggregate principal amount equal to or in excess of Five Hundred
Thousand United States Dollars ($500,000) and if requested by such holder, interest on such
holder’s Notes shall be paid by wire transfer in immediately available funds to any bank
located in the United States in accordance with the wire transfer instruction supplied by
such holder from time to time to the Trustee and paying agent (if different from Trustee) in
writing at least five (5) Business Days prior to the applicable record date. The term
“record date” with respect to any Interest Payment Date shall mean each May 1 and November 1
immediately preceding the relevant Interest Payment Date, whether or not such date is a
Business Day. Interest on the Notes shall be computed on the basis of a 360-day year
comprised of twelve 30-day months. Any accrued and unpaid interest which is not paid within
five (5) Business Days of the Interest Payment Date on which such payment of interest was
due shall bear interest at the rate of 12% per annum from such Interest Payment Date until
the same is paid in full (or, if less, the maximum interest rate then permitted by
applicable law) (the “Default Interest”).




(g) Provided that the Equity Conditions are satisfied (or waived by 66 2/3% of the
holders of Notes on the Record Date (the “Required Holders”)) during the period commencing
five (5) Business Days prior to the Interest Payment Date through such Interest Payment
Date, interest shall be payable in shares of Common Stock (“Interest Payment Shares”) or, at
the option of the Company, in whole or in part, in cash, provided that the Interest Payments
which accrued during any period shall be payable in cash only if the Company indicates that
the Interest will be paid, in whole or in part, in cash in the Interest Payment Notice (as
defined below). At least fifteen (15) Trading Days prior to the applicable Interest Payment
Date (the “Interest Payment Notice Date”), the Company shall provide written notice (the
“Interest Payment Notice”) to the Trustee and the holders of Notes either indicating that
the Interest Payment is to be paid in cash or confirming that the Interest Payment shall be
paid in Interest Payment Shares and the Interest Payment Notice shall contain a
certification that the Equity Conditions have been satisfied as of the Interest Payment
Notice Date. If the Equity Conditions were satisfied as of the Interest Payment Notice Date
but the Equity Conditions are no longer satisfied at any time prior to the Interest Payment
Date, the Company shall provide the Trustee and the holders of Notes a subsequent notice to
that effect indicating that unless the Trustee waives the Equity Conditions, the Interest
Payment shall be paid in cash. If any Interest Payment Shares are to be issued on a
Interest Payment Date, then the Company shall on the applicable Interest Payment Date, (X)
provided that the Company’s designated transfer agent (the “Transfer Agent”) is
participating in The Depository Trust Company (“DTC”) Fast Automated Securities Transfer
Program, credit such aggregate number of shares of Common Stock to which the holder shall be
entitled to the holder’s or its designee’s balance account with DTC through its Deposit
Withdrawal Agent Commission system, or (Y) if the Transfer Agent is not participating in
the DTC Fast Automated Securities Transfer Program, issue and deliver to such holder, a
certificate, registered in the name of the holder or its designee, for the number of shares
of Common Stock to which the holder shall be entitled. Common Stock used to pay any such
Interest payment shall be valued at ninety percent (90%) of the Current Market Price of the
Common Stock as of the date two (2) Business Days prior to the applicable Interest Payment
Date. If any fractional share of Common Stock otherwise would be issuable as a result of
the issuance of Common Stock to pay interest due on the Notes, the Company shall calculate
and pay a cash adjustment in lieu of such fractional share at the Current Market Price
thereof to the holder of Notes.




(h) If the Company defaults in a payment of interest on the Notes, it shall pay the
defaulted interest in any lawful manner plus, to the extent lawful, the Default Interest, to
the Persons who are holders on a subsequent special record date. The Company shall promptly
notify the Trustee in writing of the amount of defaulted interest proposed to be paid on
each Note and the date of the proposed payment. The Company shall fix or cause to be fixed
each such special record date and payment date, provided that no such special record date
shall be less than ten (10) days prior to the related payment date for such defaulted
interest. At least fifteen (15) days (unless a shorter period is satisfactory to the
Trustee) before the special record date, the Company (or, upon the written request of the
Company, the Trustee in the name and at the expense of the Company) shall send or cause to
be sent to holders a notice that states the special record date, the related payment date
and the amount of such interest to be paid. Interest shall accrue from the Issue Date in
the manner set forth in this Indenture and the form of Note attached hereto as Exhibit
A.



Section 2.4 Execution of Notes



The Notes shall be signed in the name and on behalf of the Company by the manual or facsimile
signature of its President, its Chief Executive Officer, or any of its Vice Presidents, and
attested by the manual or facsimile signature of its Chief Financial Officer, Treasurer or its
Assistant Treasurer, or Secretary or any of its Assistant Secretaries (which may be printed,
engraved or otherwise reproduced thereon, by facsimile or otherwise). Only such Notes as shall
bear thereon a certificate of authentication substantially in the form set forth on the form of
Note attached as Exhibit A hereto, manually executed by the Trustee (or an authenticating
agent appointed by the Trustee as provided by Section 17.10), shall be entitled to the benefits of
this Indenture or be valid or obligatory for any purpose. Such certificate by the Trustee (or such
authenticating agent) upon any Note executed by the Company shall be conclusive evidence that the
Note so authenticated has been duly authenticated and delivered hereunder and that the holder
thereof is entitled to the benefits of this Indenture.



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



Section 2.5 Exchange and Registration of Transfer of Notes; Restrictions on Transfer




(a) Note Register. The Company shall cause to be kept at the Corporate Trust Office a
register (the register maintained in such office and in any other office or agency of the
Company designated pursuant to Section 5.2 being herein sometimes collectively referred to
as the “Note Register”) in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the registration of Notes and of transfers of
Notes. Such register shall be in written form or in any form capable of being converted
into written form within a reasonable period of time. The Trustee is hereby appointed “Note
Registrar” for the purpose of registering Notes and transfers of Notes as herein provided.
The Company may appoint one or more co-registrars in accordance with Section 5.2.




(b) Transfer and Exchange of Global Notes. A Global Note may not be transferred as a
whole except by the Depositary to a nominee of the Depositary, by a nominee of the
Depositary to the Depositary or to another nominee of the Depositary, or by the Depositary
or any such nominee to a successor Depositary or a nominee of such successor Depositary.
All Global Notes will be exchanged by the Company for Definitive Notes if (i) the Company
delivers to the Trustee notice from the Depositary that it is unwilling or unable to
continue to act as Depositary or that it is no longer a clearing agency registered under the
Exchange Act and, in either case, a successor Depositary is not appointed by the Company
within 120 days after the date of such notice from the Depositary or (ii) the Company in its
sole discretion determines that the Global Notes (in whole but not in part) should be
exchanged for Definitive Notes and delivers a written notice to such effect to the Trustee.
Upon the occurrence of either of the preceding events in (i) or (ii) above, Definitive Notes
shall be issued in such names as the Depositary shall instruct the Trustee. Global Notes
also may be exchanged or replaced, in whole or in part, as provided in Sections 2.6 and 2.7.
Every Note authenticated and delivered in exchange for, or in lieu of, a Global Note or any
portion thereof, pursuant to this Section 2.5(b) or Section 2.6 or 2.7, shall be
authenticated and delivered in the form of, and shall be, a Global Note. A Global Note may
not be exchanged for another Note other than as provided in this Section 2.5(b), however,
beneficial interests in a Global Note may be transferred and exchanged as provided in
Section 2.5(c) or (d).




(c) Transfer and Exchange of Beneficial Interests in the Global Notes. The transfer
and exchange of beneficial interests in the Global Notes shall be effected through the
Depositary, in accordance with the provisions of this Indenture and the Applicable
Procedures. Beneficial interests in the Restricted Global Notes shall be subject to
restrictions on transfer comparable to those set forth herein to the extent required by the
Securities Act. Transfers of beneficial interests in the Global Notes also shall require
compliance with either subparagraph (i) or (ii) below, as applicable, as well as one or more
of the other following subparagraphs, as applicable:




(i) Transfer of Beneficial Interests in the Same Global Note. Beneficial
interests in any Restricted Global Note may be transferred to Persons who take
delivery thereof in the form of a beneficial interest in the same Restricted Global
Note in accordance with the transfer restrictions set forth in the Private Placement
Legend. Beneficial interests in any Unrestricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note. No written orders or instructions shall be required to be
delivered to the Note Registrar to effect the transfers described in this Section
2.5(c)(i).




(ii) All Other Transfers and Exchanges of Beneficial Interests in Global Notes.
In connection with all transfers and exchanges of beneficial interests that are not
subject to Section 2.5(c)(i) above, the transferor of such beneficial interest must
deliver to the Note Registrar either (A) (1) a written order from a Participant or
an Indirect Participant given to the Depositary in accordance with the Applicable
Procedures directing the Depositary to credit or cause to be credited a beneficial
interest in another Global Note in an amount equal to the beneficial interest to be
transferred or exchanged and (2) instructions given in accordance with the
Applicable Procedures containing information regarding the Participant account to be
credited with such increase or (B) (1) a written order from a Participant or an
Indirect Participant given to the Depositary in accordance with the Applicable
Procedures directing the Depositary to cause to be issued a Definitive Note in an
amount equal to the beneficial interest to be transferred or exchanged and (2)
instructions given by the Depositary to the Note Registrar containing information
regarding the Person in whose name such Definitive Note shall be registered to
effect the transfer or exchange referred to in (1) above. Upon satisfaction of all
of the requirements for transfer or exchange of beneficial interests in Global Notes
contained in this Indenture and the Notes or otherwise applicable under the
Securities Act, the Trustee shall adjust the principal amount of the relevant Global
Note(s) pursuant to Section 2.5(l).




(iii) Transfer of Beneficial Interests to Another Restricted Global Note. A
beneficial interest in any Restricted Global Note may be transferred to a Person who
takes delivery thereof in the form of a beneficial interest in another Restricted
Global Note if the transfer complies with the requirements of Section 2.5(c)(ii)
above and the Note Registrar receives the following:




(A) if the transferee will take delivery in the form of a beneficial
interest in the 144A Global Note, then the transferor must deliver a
certificate in the form of Exhibit D hereto, including the
certifications in item (1) thereof; and




(B) if the transferee will take delivery in the form of a beneficial
interest in the IAI Global Note, then the transferor must deliver a
certificate in the form of Exhibit D hereto, including the
certifications and certificates and Opinion of Counsel required by item (2)
thereof, if applicable.




(iv) Transfer of Beneficial Interests in a Restricted Global Note for
Beneficial Interests in the Unrestricted Global Note. A beneficial interest in any
Restricted Global Note may be transferred to a Person who takes delivery thereof in
the form of a beneficial interest in an Unrestricted Global Note if the transfer
complies with the requirements of Section 2.5(c)(ii) above and




(A) such transfer is effected pursuant to a registration statement
filed in accordance with the Registration Rights Agreement; or




(B) the Note Registrar receives the following:




(1) if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a
beneficial interest in an Unrestricted Global Note, a certificate
from such holder in the form of Exhibit E hereto, including
the certifications in item (1)(a) thereof; or




(2) if the holder of such beneficial interest in a Restricted
Global Note proposes to transfer such beneficial interest to a Person
who shall take delivery thereof in the form of a beneficial interest
in an Unrestricted Global Note, a certificate from such holder in the
form of Exhibit D hereto, including one of the certifications
in item (3) thereof;




and, in each such case set forth in this subparagraph (B), if the Note
Registrar so requests or if the Applicable Procedures so require, an Opinion
of Counsel in form reasonably acceptable to the Note Registrar to the effect
that such exchange or transfer is in compliance with the Securities Act and
that the restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain compliance with
the Securities Act.




If any such transfer is effected pursuant to subparagraph (B) above at a time
when an Unrestricted Global Note has not yet been issued, the Company shall issue
and, upon receipt of an Authentication Order in accordance with Section 2.1, the
Trustee shall authenticate one or more Unrestricted Global Notes in an aggregate
principal amount equal to the aggregate principal amount of beneficial interests
transferred pursuant to subparagraph (B) above.




Beneficial interests in an Unrestricted Global Note cannot be exchanged for, or
transferred to Persons who take delivery thereof in the form of, a beneficial
interest in a Restricted Global Note.




(d) Transfer or Exchange of Beneficial Interests for Definitive Notes.




(i) Beneficial Interests in Restricted Global Notes to Restricted Definitive
Notes. If any holder of a beneficial interest in a Restricted Global Note proposes
to exchange such beneficial interest for a Restricted Definitive Note or to transfer
such beneficial interest to a Person who takes delivery thereof in the form of a
Restricted Definitive Note, then, upon receipt by the Note Registrar of the
following documentation:




(A) if the holder of such beneficial interest in a Restricted Global
Note proposes to exchange such beneficial interest for a Restricted
Definitive Note, a certificate from such holder in the form of Exhibit
E hereto, including the certifications in item (2)(a) thereof;




(B) if such beneficial interest is being transferred to a QIB in
accordance with Rule 144A under the Securities Act, a certificate to the
effect set forth in Exhibit D hereto, including the certifications
in item (1) thereof;




(C) if such beneficial interest is being transferred pursuant to an
exemption from the registration requirements of the Securities Act in
accordance with Rule 144 under the Securities Act, a certificate to the
effect set forth in Exhibit D hereto, including the certifications
in item (2)(a) thereof;




(D) if such beneficial interest is being transferred to an
Institutional Accredited Investor in reliance on an exemption from the
registration requirements of the Securities Act other than those listed in
subparagraphs (B) and (C) above, a certificate to the effect set forth in
Exhibit D hereto, including the certifications, certificates and
Opinion of Counsel required by item (2) thereof, if applicable;




(E) if such beneficial interest is being transferred to the Company or
any of its Subsidiaries, a certificate to the effect set forth in
Exhibit D hereto, including the certifications in item (2)(b)
thereof; or




(F) if such beneficial interest is being transferred pursuant to an
effective registration statement under the Securities Act, a certificate to
the effect set forth in Exhibit D hereto, including the
certifications in item (2)(c) thereof;




the Trustee shall cause the aggregate principal amount of the applicable Global Note to be
reduced accordingly pursuant to Section 2.5(l), and the Company shall execute and the
Trustee shall authenticate and deliver to the Person designated in the instructions a
Definitive Note in the appropriate principal amount. Any Definitive Note issued in exchange
for a beneficial interest in a Restricted Global Note pursuant to this Section 2.5(d) shall
be registered in such name or names and in such authorized denomination or denominations as
the holder of such beneficial interest shall instruct the Note Registrar through
instructions from the Depositary and the Participant or Indirect Participant. The Trustee
shall deliver such Definitive Notes to the Persons in whose names such Notes are so
registered. Any Definitive Note issued in exchange for a beneficial interest in a
Restricted Global Note pursuant to this Section 2.5(d)(i) shall bear the Private Placement
Legend and shall be subject to all restrictions on transfer contained therein.




(ii) Beneficial Interests in Restricted Global Notes to Unrestricted Definitive
Notes. A holder of a beneficial interest in a Restricted Global Note may exchange
such beneficial interest for an Unrestricted Definitive Note or may transfer such
beneficial interest to a Person who takes delivery thereof in the form of an
Unrestricted Definitive Note only if:




(A) such transfer is effected pursuant to a registration statement
filed in accordance with the Registration Rights Agreement; or




(B) the Note Registrar receives the following:




(1) if the holder of such beneficial interest in a Restricted
Global Notes proposes to exchange such beneficial interest for an
Unrestricted Definitive Note, a certificate from such holder in the
form of Exhibit E hereto, including the certifications in
item (1)(b) thereof; or




(2) if the holder of such beneficial interest in a Restricted
Global Notes proposes to transfer such beneficial interest to a
Person who shall take delivery thereof in the form of an Unrestricted
Definitive Note, a certificate from such holder in the form of
Exhibit D hereto, including the certifications in item (3)
thereof;




and, in each such case set forth in this subparagraph (B), if the Note Registrar so
requests or if the Applicable Procedures so require, an Opinion of Counsel in form
reasonably acceptable to the Note Registrar to the effect that such exchange or
transfer is in compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no longer required
in order to maintain compliance with the Securities Act.




(iii) Beneficial Interests in Unrestricted Global Notes to Unrestricted
Definitive Notes. If any holder of a beneficial interest in an Unrestricted Global
Note proposes to exchange such beneficial interest for an Unrestricted Definitive
Note or to transfer such beneficial interest to a Person who takes delivery thereof
in the form of an Unrestricted Definitive Note, then, upon satisfaction of the
conditions set forth in Section 2.5(c)(ii), the Trustee shall cause the aggregate
principal amount of the applicable Global Note to be reduced accordingly pursuant to
Section 2.5(l), and the Company shall execute and the Trustee shall authenticate and
deliver to the Person designated in the instructions an Unrestricted Definitive Note
in the appropriate principal amount. Any Definitive Note issued in exchange for a
beneficial interest pursuant to this Section 2.5(d)(iii) shall be registered in such
name or names and in such authorized denomination or denominations as the holder of
such beneficial interest shall instruct the Note Registrar through instructions from
the Depositary and the Participant or Indirect Participant. The Trustee shall
deliver such Unrestricted Definitive Notes to the Persons in whose names such Notes
are so registered. Any Unrestricted Definitive Note issued in exchange for a
beneficial interest pursuant to this Section 2.5(d)(iii) shall not bear the Private
Placement Legend.




(e) Transfer and Exchange of Definitive Notes for Beneficial Interests.




(i) Restricted Definitive Notes to Beneficial Interests in Restricted Global
Notes. If any holder of a Restricted Definitive Note proposes to exchange such Note
for a beneficial interest in a Restricted Global Note or to transfer such Restricted
Definitive Notes to a Person who takes delivery thereof in the form of a beneficial
interest in a Restricted Global Note, then, upon receipt by the Note Registrar of
the following documentation:




(A) if the holder of such Restricted Definitive Note proposes to
exchange such Note for a beneficial interest in a Restricted Global Note, a
certificate from such holder in the form of Exhibit E hereto,
including the certifications in item (2)(b) thereof;




(B) if such Restricted Definitive Note is being transferred to a QIB in
accordance with Rule 144A under the Securities Act, a certificate to the
effect set forth in Exhibit D hereto, including the certifications
in item (1) thereof;




(C) if such Restricted Definitive Note is being transferred pursuant to
an exemption from the registration requirements of the Securities Act in
accordance with Rule 144 under the Securities Act, a certificate to the
effect set forth in Exhibit D hereto, including the certifications
in item (2)(a) thereof;




(D) if such Restricted Definitive Note is being transferred to an
Institutional Accredited Investor in reliance on an exemption from the
registration requirements of the Securities Act other than those listed in
subparagraphs (B) and (C) above, a certificate to the effect set forth in
Exhibit D hereto, including the certifications, certificates and
Opinion of Counsel required by item (2) thereof, if applicable;




(E) if such Restricted Definitive Note is being transferred to the
Company or any of its Subsidiaries, a certificate to the effect set forth in
Exhibit D hereto, including the certifications in item (2)(b)
thereof; or




(F) if such Restricted Definitive Note is being transferred pursuant to
an effective registration statement under the Securities Act, a certificate
to the effect set forth in Exhibit D hereto, including the
certifications in item (2)(c) thereof;




the Trustee shall cancel the Restricted Definitive Note, increase or cause to be
increased the aggregate principal amount of, in the case of clause (A) above, the
appropriate Restricted Global Note, in the case of clause (B) above, the 144A Global
Note, and in all other cases, the IAI Global Note.




(ii) Restricted Definitive Notes to Beneficial Interests in Unrestricted Global
Notes. A holder of a Restricted Definitive Note may exchange such Note for a
beneficial interest in an Unrestricted Global Note or transfer such Restricted
Definitive Note to a Person who takes delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note only if:




(A) such transfer is effected pursuant to a registration statement
filed in accordance with the Registration Rights Agreement; or




(B) the Note Registrar receives the following:




(1) if the holder of such Restricted Definitive Notes proposes
to exchange such Notes for a beneficial interest in the Unrestricted
Global Note, a certificate from such holder in the form of
Exhibit E hereto, including the certifications in item (1)(c)
thereof; or




(2) if the holder of such Restricted Definitive Notes proposes
to transfer such Notes to a Person who shall take delivery thereof in
the form of a beneficial interest in the Unrestricted Global Note, a
certificate from such holder in the form of Exhibit D hereto,
including the certifications in item (3) thereof;




and, in each such case set forth in this subparagraph (B), if the Note Registrar so
requests or if the Applicable Procedures so require, an Opinion of Counsel in form
reasonably acceptable to the Note Registrar to the effect that such exchange or
transfer is in compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no longer required
in order to maintain compliance with the Securities Act.




Upon satisfaction of the conditions of any of the subparagraphs in this Section
2.5(e)(ii), the Trustee shall cancel the Restricted Definitive Notes and increase or
cause to be increased the aggregate principal amount of the Unrestricted Global
Note.




(iii) Unrestricted Definitive Notes to Beneficial Interests in Unrestricted
Global Notes. A holder of an Unrestricted Definitive Note may exchange such Note
for a beneficial interest in an Unrestricted Global Note or transfer such
Unrestricted Definitive Notes to a Person who takes delivery thereof in the form of
a beneficial interest in an Unrestricted Global Note at any time. Upon receipt of a
request for such an exchange or transfer, the Trustee shall cancel the applicable
Unrestricted Definitive Note and increase or cause to be increased the aggregate
principal amount of one of the Unrestricted Global Notes.




If any such exchange or transfer from an Unrestricted Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (ii)(A), (ii)(B) or (iii)
above at a time when an Unrestricted Global Note has not yet been issued, the
Company shall issue and, upon receipt of an Authentication Order in accordance with
Section 2.1, the Trustee shall authenticate one or more Unrestricted Global Notes in
an aggregate principal amount equal to the principal amount of Unrestricted
Definitive Notes so transferred.




(f) Transfer and Exchange of Definitive Notes for Definitive Notes. Upon request by a
holder of Definitive Notes and such holder’s compliance with the provisions of this Section
2.5(f), the Note Registrar shall register the transfer or exchange of Definitive Notes.
Prior to such registration of transfer or exchange, the requesting holder shall present or
surrender to the Note Registrar the Definitive Notes duly endorsed or accompanied by a
written instruction of transfer in form satisfactory to the Note Registrar duly executed by
such holder or by its attorney, duly authorized in writing. In addition, the requesting
holder shall provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section 2.5(f).




(i) Restricted Definitive Notes to Restricted Definitive Notes. Any Restricted
Definitive Note may be transferred to and registered in the name of Persons who take
delivery thereof in the form of a Restricted Definitive Note if the Note Registrar
receives the following:




(A) if the transfer will be made pursuant to Rule 144A under the
Securities Act, then the transferor must deliver a certificate in the form
of Exhibit D hereto, including the certifications in item (1)
thereof; and




(B) if the transfer will be made pursuant to any other exemption from
the registration requirements of the Securities Act, then the transferor
must deliver a certificate in the form of Exhibit D hereto,
including the certifications, certificates and Opinion of Counsel required
by item (2) thereof, if applicable.




(ii) Restricted Definitive Notes to Unrestricted Definitive Notes. Any
Restricted Definitive Note may be exchanged by the holder thereof for an
Unrestricted Definitive Note or transferred to a Person or Persons who take delivery
thereof in the form of an Unrestricted Definitive Note if:




(A) any such transfer is effected pursuant to a registration statement
filed in accordance with the Registration Rights Agreement; or




(B) the Note Registrar receives the following:




(1) if the holder of such Restricted Definitive Notes proposes
to exchange such Notes for an Unrestricted Definitive Note, a
certificate from such holder in the form of Exhibit E hereto,
including the certifications in item (1)(d) thereof; or




(2) if the holder of such Restricted Definitive Notes proposes
to transfer such Notes to a Person who shall take delivery thereof in
the form of an Unrestricted Definitive Note, a certificate from such
holder in the form of Exhibit D hereto, including the
certifications in item (3) thereof;




and, in each such case set forth in this subparagraph (B), if the Note
Registrar so requests, an Opinion of Counsel in form reasonably acceptable
to the Company to the effect that such exchange or transfer is in compliance
with the Securities Act and that the restrictions on transfer contained
herein and in the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act.




(iii) Unrestricted Definitive Notes to Unrestricted Definitive Notes. A holder
of Unrestricted Definitive Notes may transfer such Notes to a Person who takes
delivery thereof in the form of an Unrestricted Definitive Note. Upon receipt of a
request to register such a transfer, the Note Registrar shall register the
Unrestricted Definitive Notes pursuant to the instructions from the holder thereof.




(g) General Provisions Relating to Transfers and Exchanges.




Upon surrender for registration of transfer of any Note to the Note Registrar or any
co-registrar, and satisfaction of the requirements for such transfer set forth in this
Section 2.5, the Company shall execute, and the Trustee shall authenticate and deliver, in
the name of the designated transferee or transferees, one or more new Notes of any
authorized denominations and of a like aggregate principal amount and bearing such
restrictive legends as may be required by this Indenture.




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




None of the Company, the Trustee, the Note Registrar or any co-registrar shall be
required to exchange or register a transfer of (a) any Notes for a period of fifteen (15)
days next preceding the sending of the notice of redemption or (b) any Notes called for
redemption or, if a portion of any Note is selected or called for redemption, such portion
thereof selected or called for redemption or (c) any Notes surrendered for conversion or, if
a portion of any Note is surrendered for conversion, such portion thereof surrendered for
conversion or (d) any Notes, or a portion of any Note, surrendered for repurchase (and not
withdrawn) in connection with a Repurchase Event or (e) any Notes, or a portion of any Note,
tendered for repurchase (and not withdrawn) pursuant to Section 16.1.




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




Prior to due presentment for the registration of a transfer of any Note, the Trustee,
any agent and the Company may deem and treat the Person in whose name any Note is registered
as the absolute owner of such Note for the purpose of receiving payment of principal of and
interest on such Notes and for all other purposes, and none of the Trustee, any agent or the
Company shall be affected by notice to the contrary.




The Trustee shall authenticate Global Notes and Definitive Notes in accordance with the
provisions of Section 2.1.




(h) Legends.




(i) Private Placement Legend on the Notes. Every Note that bears or is
required under this Section 2.5(h)(i) to bear the legend set forth in this
Section 2.5(h)(i) (together with any Common Stock issued upon conversion of the
Notes and required to bear the legend set forth in Section 2.5(h)(ii), collectively,
the “Restricted Securities”) shall be subject to the restrictions on transfer set
forth in this Section 2.5(h)(i) (including the legend set forth below), unless such
restrictions on transfer shall be waived by written consent of the Company, and the
holder of each such Restricted Security, by such holder’s acceptance thereof, agrees
to be bound by all such restrictions on transfer. As used in Sections 2.5(h)(i)
and 2.5(h)(ii), the term “transfer” encompasses any sale, transfer or other
disposition (excluding any pledge unless or until any foreclosure on such pledge)
whatsoever of any Restricted Security.




Subject to Section 5 of the Securities Purchase Agreement, until two (2) years
after the original issuance date of any Note, any certificate evidencing such Note
(and all securities issued in exchange therefor or substitution thereof, other than
Common Stock, if any, issued upon conversion thereof which shall bear the legend set
forth in Section 2.5(h)(ii), if applicable) shall bear a legend in substantially the
following form (unless such Note has been registered pursuant to a registration
statement that has been declared effective under the Securities Act, or the Note has
been transferred pursuant to the exemption from registration provided by Rule 144
under the Securities Act, or unless otherwise agreed by the Company in writing, with
notice thereof to the Trustee):




THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR APPLICABLE STATE
SECURITIES LAWS. THIS SECURITY MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR
ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN
EXEMPTION FROM THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS. THIS
SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN
SECURED BY THIS SECURITY.




The Company may, but is not obligated to, instruct the Trustee to place the
following legend on any Note held by or transferred to an “affiliate” (as defined in
Rule 501(b) of Regulation D under the Securities Act):




THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE HELD BY A PERSON WHO MAY BE
DEEMED TO BE AN AFFILIATE OF THE ISSUER FOR PURPOSES OF RULE 144 PROMULGATED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND MAY BE SOLD ONLY
IN COMPLIANCE WITH RULE 144 OR PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT. THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE
MARGIN ACCOUNT OR OTHER LOAN SECURED BY THE SECURITIES.




Any Note (or security issued in exchange or substitution therefor) as to which
such restrictions on transfer shall have expired in accordance with their terms may,
upon surrender of such Note for exchange to the Note Registrar in accordance with
the provisions of this Section 2.5, be exchanged for a new Note or Notes, of like
tenor and aggregate principal amount, which shall not bear the restrictive legend
required by this Section 2.5(h)(i).




(ii) Private Placement Legend on Stock Certificate. Until two (2) years after
the original issuance date of any Note, any stock certificate representing Common
Stock issued upon conversion of such Note shall bear a legend in substantially the
following form (unless such Common Stock has been registered pursuant to a
registration statement that has been declared effective under the Securities, or the
Notes from which such Common Stock was converted were registered pursuant to a
registration statement that has been declared effective under the Securities Act and
which was effective at the time of such transfer, or the Common Stock has been
transferred pursuant to an exemption from registration provided by Rule 144 under
the Securities Act, or unless otherwise agreed by the Company in writing with
written notice thereof to the Trustee and any transfer agent for the Common Stock):




THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR APPLICABLE STATE
SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR
ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN
EXEMPTION FROM THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS. THE
SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
LOAN SECURED BY THE SECURITIES.




The Company may, but is not obligated to, instruct the transfer agent for the
Company’s Common Stock to place the following legend on any certificate evidencing
 shares of Common Stock held by or transferred to an “affiliate” (as defined in
Rule 501(b) of Regulation D under the Securities Act) of the Company:




THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE HELD BY A PERSON WHO MAY BE
DEEMED TO BE AN AFFILIATE OF THE ISSUER FOR PURPOSES OF RULE 144 PROMULGATED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND MAY BE SOLD ONLY
IN COMPLIANCE WITH RULE 144 OR PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT. THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE
MARGIN ACCOUNT OR OTHER LOAN SECURED BY THE SECURITIES.




Any such Common Stock as to which such restrictions on transfer shall have
expired in accordance with their terms may, upon surrender of the certificates
representing such shares of Common Stock for exchange in accordance with the
procedures of the transfer agent for the Common Stock, be exchanged for a new
certificate or certificates for a like aggregate number of shares of Common Stock,
which shall not bear the restrictive legend required by this Section 2.5(h)(ii).




(iii) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:




THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING
THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS
HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT
(I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO
SECTION 2.6 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT
NOT IN PART PURSUANT TO SECTION 2.5(b) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY
BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.8 OF THE
INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY
WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.




(i) Resale of Notes Purchased by the Company or an Affiliate. Any Note or Common Stock
issued upon the conversion or exchange of a Note that, prior to the expiration of the
holding period applicable to sales thereof under Rule 144(k) under the Securities Act (or
any successor rule), is purchased or owned by the Company or any Affiliate thereof may not
be resold by the Company or such Affiliate unless registered under the Securities Act or
resold pursuant to an exemption from the registration requirements of the Securities Act in
a transaction that results in such Notes or Common Stock, as the case may be, no longer
being “restricted securities” (as defined under Rule 144).




(j) Changes in Law. Notwithstanding any provision of Section 2.5 to the contrary, in
the event Rule 144(k) as promulgated under the Securities Act (or any successor rule) is
amended to change the two-year period under Rule 144(k) (or the corresponding period under
any successor rule), from and after receipt by the Trustee of the Officer’s Certificate and
Opinion of Counsel provided for in this Section 2.5(j), (i) each reference in
Section 2.5(h)(i) to “two (2) years” shall be deemed for all purposes hereof to be
references to such changed period, (ii) each reference in Section 2.5(h)(ii) to “two (2)
years” shall be deemed for all purposes hereof to be references to such changed period and
(iii) all corresponding references in the Notes shall be deemed for all purposes hereof to
be references to such changed period, provided that such changes shall not become effective
if they are otherwise prohibited by, or would otherwise cause a violation of, the
then-applicable federal securities laws. As soon as practicable after the Company has
knowledge of the effectiveness of any such amendment to change the two-year period under
Rule 144(k) (or the corresponding period under any successor rule), unless such changes
would otherwise be prohibited by, or would otherwise cause a violation of, the
then-applicable securities law, the Company shall provide to the Trustee an Officer’s
Certificate and Opinion of Counsel informing the Trustee of the effectiveness of such
amendment and the effectiveness of the foregoing changes to Sections 2.5(h)(i)
and 2.5(h)(ii) and the Notes. The provisions of this Section 2.5(j) will not be effective
until such time as the Opinion of Counsel and Officer’s Certificate have been received by
the Trustee hereunder. This Section 2.5(j) shall apply to successive amendments to
Rule 144(k) (or any successor rule) changing the holding period thereunder.




(k) Limitation on Trustee’s Duties. The Trustee shall have no obligation or duty to
monitor, determine or inquire as to compliance with any restrictions on transfer imposed
under this Indenture or under applicable law with respect to any transfer of any interest in
any Note 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.




(l) Cancellation and/or Adjustment of Global Notes. At such time as all beneficial
interests in a particular Global Note have been exchanged for Definitive Notes or a
particular Global Note has been redeemed, repurchased or canceled in whole and not in part,
each such Global Note shall be returned to or retained and canceled by the Trustee in
accordance with Section 2.8. At any time prior to such cancellation, if any beneficial
interest in a Global Note is exchanged for or transferred to a Person who will take delivery
thereof in the form of a beneficial interest in another Global Note or for Definitive Notes,
the principal amount of Notes represented by such Global Note shall be reduced accordingly
and an endorsement shall be made on such Global Note by the Trustee or by the Depositary at
the direction of the Trustee to reflect such reduction; and if the beneficial interest is
being exchanged for or transferred to a Person who will take delivery thereof in the form of
a beneficial interest in another Global Note, such other Global Note shall be increased
accordingly and an endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.



Section 2.6 Mutilated, Destroyed, Lost or Stolen Notes



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



The Trustee or such authenticating agent may authenticate any such substituted Note and
deliver the same upon the receipt of such security or indemnity as the Trustee, the Company and, if
applicable, such authenticating agent may reasonably require. Upon the issuance of any substituted
Note, the Company may require the payment by the holder of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other expenses connected
therewith. Once any substitute Note has been issued pursuant to this Section 2.6, the original
Note being replaced by such substitute Note shall automatically be deemed canceled. In case any
Note which has matured or is about to mature or has been called for redemption or is about to be
converted into Common Stock shall become mutilated or be destroyed, lost or stolen, the Company
may, instead of issuing a substitute Note, pay or authorize the payment of or convert or authorize
the conversion of the same (without surrender thereof except in the case of a mutilated Note), as
the case may be, if the applicant for such payment or conversion shall furnish to the Company, to
the Trustee and, if applicable, to such authenticating agent such security or indemnity as will be
required by them to save each of them harmless for any loss, liability, cost or expense caused by
or connected with such substitution, and, in case of destruction, loss or theft, evidence
reasonably satisfactory to the Company, the Trustee and, if applicable, any paying agent or
conversion agent of the destruction, loss or theft of such Note and of the ownership thereof.



Every substitute Note issued pursuant to the provisions of this Section 2.6 by virtue of the
fact that any Note is destroyed, lost or stolen shall constitute an additional contractual
obligation of the Company, whether or not the destroyed, lost or stolen Note shall be found at any
time, and shall be entitled to all the benefits of (but shall be subject to all the limitations set
forth in) this Indenture equally and proportionately with any and all other Notes duly issued
hereunder. To the extent permitted by law, all Notes shall be held and owned upon the express
condition that the foregoing provisions are exclusive with respect to the replacement or payment or
conversion of mutilated, destroyed, lost or stolen Notes and shall preclude any and all other
rights or remedies notwithstanding any law or statute existing or hereafter enacted to the contrary
with respect to the replacement or payment or conversion of negotiable instruments or other
securities without their surrender.



Section 2.7 Temporary Notes



Pending the preparation of definitive Notes, the Company may execute and the Trustee or an
authenticating agent appointed by the Trustee shall, upon written request of the Company,
authenticate and deliver temporary Notes (printed or lithographed). Temporary Notes shall be
issuable in any authorized denomination, and substantially in the form of the Global Notes or the
Definitive Notes, as the case may be, but with such omissions, insertions and variations as may be
appropriate for temporary Notes, all as may be determined by the Company. Every such temporary
Note shall be executed by the Company and authenticated by the Trustee or such authenticating agent
upon the same conditions and in substantially the same manner, and with the same effect, as the
Definitive Notes or Global Notes. Without unreasonable delay the Company will execute and deliver
to the Trustee or such authenticating agent Definitive Notes and Global Notes and thereupon any or
all temporary Notes may be surrendered in exchange for the applicable replacement Note, at each
office or agency maintained by the Company pursuant to Section 5.2 and the Trustee or such
authenticating agent shall authenticate and deliver in exchange for such temporary Notes an equal
aggregate principal amount of Definitive Notes or Global Notes, as the case may be. Such exchange
shall be made by the Company at its own expense and without any charge therefor. Until so
exchanged, the temporary Notes shall in all respects be entitled to the same benefits and subject
to the same limitations under this Indenture as Definitive Notes or Global Notes, as the case may
be, authenticated and delivered hereunder.



Section 2.8 Cancellation of Notes Paid, Etc.



All Notes surrendered for the purpose of payment, redemption, repurchase, conversion, exchange
or registration of transfer, shall, if surrendered to the Company or any paying agent or any Note
Registrar or any conversion agent, be surrendered to the Trustee and promptly canceled by it, or,
if surrendered to the Trustee, shall be promptly canceled by it, and no Notes shall be issued in
lieu thereof except as expressly permitted by any of the provisions of this Indenture. Upon
written instructions of the Company, the Trustee shall dispose of canceled Notes in accordance with
its customary procedures. If the Company shall acquire any of the Notes, such acquisition shall
not operate as a redemption or satisfaction of the indebtedness represented by such Notes unless
and until the same are delivered to the Trustee for cancellation.



Section 2.9 CUSIP Numbers



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



Section 2.10 Calculation of Original Issue Discount



The Company shall file with the Trustee promptly at the end of each calendar year (i) a
written notice specifying the amount of original issue discount (including daily rates and accrual
periods) accrued on the Notes as of the end of such year and (ii) such other specific information
relating to such original issue discount as may then be relevant under the Internal Revenue Code of
1986, as amended from time to time.



ARTICLE III




OPTIONAL REDEMPTION OF NOTES




Section 3.1 Redemption Price



From and after May 21, 2009, the Company may, at its option, redeem all or any part of the
Notes, upon notice as set forth in Section 3.2, and the Company shall pay each holder of Notes
redeemed a redemption price equal to the principal amount of such Notes, plus accrued and unpaid
interest, Default Interest and Liquidated Damages, if any, accrued thereon, if any, to, but
excluding, the date of redemption (the “Redemption Price”); provided that the Equity Conditions
shall have been satisfied as of the date of the Redemption Notice. Notwithstanding anything herein
to the contrary, if at any time prior to the date of such redemption (the “Redemption Date”) with
respect to a Redemption Notice (as defined below) the Equity Conditions are no longer satisfied,
the Company shall provide a notice to the Trustee and each holder of Notes of such failure and,
unless the Required Holders waive such failure, the Company shall be required to withdraw the
Redemption Notice.



Section 3.2 Notice of Redemption; Selection of Notes



In case the Company shall desire to exercise the right to redeem (all or, as the case may be,
any part of the Notes pursuant to Section 3.1, it shall fix a Redemption Date, and it, or at its
request (which must be received by the Trustee at least ten (10) Business Days prior to the date
the Trustee is requested to give notice (the “Redemption Notice”) as described below unless a
shorter period is agreed to by the Trustee), the Trustee in the name of and at the expense of the
Company, shall send or cause to be sent the Redemption Notice at least thirty (30) and not more
than sixty (60) days prior to the Redemption Date to the holders of Notes so to be redeemed as a
whole or in part at their last addresses as the same appear on the Note Register (provided
that if the Company shall give a Redemption Notice, it shall also give a Redemption Notice, and
notice of the aggregate amount of Notes to be redeemed, to the Trustee). Subject to Section 3.1
hereof, such Redemption Notice shall be irrevocable. The Redemption Notice, if sent in the manner
herein provided shall be deemed given upon the holder’s actual receipt of such Redemption Notice.
Concurrently with the mailing of any such Redemption Notice (or any withdraw of such Redemption
Notice or notice of an Equity Conditions Failure), the Company shall issue a press release
announcing such redemption, the form and content of which press release shall be determined by the
Company in its sole discretion and in accordance with applicable securities laws.



Each such Redemption Notice shall specify the aggregate principal amount of Notes to be
redeemed, the “CUSIP” number or numbers of such Notes, the Redemption Date, the redemption price at
which Notes are to be redeemed, the place or places of payment, that payment will be made upon
presentation and surrender of such Notes, that the Redemption Price will be paid as specified in
said notice, and that on and after the Redemption Date (unless the Company shall default in the
deposit of the amount of money sufficient to redeem such Notes) interest thereon or on the portion
thereof to be redeemed will cease to accrue. Such Redemption Notice shall also state the current
Conversion Price and the date on which the right to convert such Notes or portions thereof into
Common Stock will expire, which shall be the close of business on the Business Day immediately
preceding the Redemption Date. If fewer than all the Notes are to be redeemed, the Redemption
Notice shall identify the Notes to be redeemed. In case any Note is to be redeemed in part only,
the Redemption Notice shall state the portion of the principal amount thereof to be redeemed and
shall state that on and after the date fixed for redemption, upon surrender of such Note, a new
Note or Notes in principal amount equal to the unredeemed portion thereof will be issued.



On or prior to the Redemption Date specified in the Redemption Notice given as provided in
this Section, the Company will deposit with the Trustee or with one or more paying agents (or, if
the Company is acting as its own paying agent, set aside, segregate and hold in trust as provided
in Section 5.4) an amount of money sufficient to redeem on the redemption date all the Notes (or
portions thereof) so called for redemption (other than those theretofore surrendered for conversion
into Common Stock) at the Redemption Price; provided that if such payment is made on the
Redemption Date it must be received by the Trustee or paying agent, as the case may be, by 1:00
p.m. New York City time, on such date. If any Note called for redemption is converted pursuant
hereto, any money deposited with the Trustee or any paying agent or so segregated and held in trust
for the redemption of such Note shall be paid to the Company upon its request, or, if then held by
the Company shall be discharged from such trust.



If fewer than all the Notes are to be redeemed, the Company will give the Trustee written
notice in the form of an Officer’s Certificate not fewer than forty-five (45) days (or such shorter
period of time as may be acceptable to the Trustee) prior to the Redemption Date as to the
aggregate principal amount of Notes to be redeemed, and the Company, or at its request, the Trustee
in the name of and at the expense of the Company, shall give the holders at least twenty (20) days’
notice in advance of the date fixed for redemption as to the aggregate principal amount of Notes to
be redeemed. If fewer than all the Notes are to be redeemed, the Trustee, subject to any
applicable rules of the Depositary, shall select the Notes or portions thereof to be redeemed (in
principal amounts of One Thousand United States Dollars ($1,000) or integral multiples thereof),
solely on a pro rata basis. If any Note selected for partial redemption is converted in part after
such selection, the converted portion of such Note shall be deemed (so far as is possible) to be
the portion to be selected for redemption. The Notes (or portions thereof) so selected shall be
deemed duly selected for redemption for all purposes hereof, notwithstanding that any such Note is
converted as a whole or in part before the sending of the Redemption Notice.



Upon any redemption of less than all Notes, the Company and the Trustee may (but need not)
treat as outstanding any Notes surrendered for conversion during the period of fifteen (15) days
next preceding the sending of a Redemption Notice and may (but need not) treat as not outstanding
any Note authenticated and delivered during such period in exchange for the unconverted portion of
any Note converted in part during such period.



Section 3.3 Payment of Notes Called for Redemption



If notice of redemption has been given as above provided, the Notes or portion of Notes with
respect to which such notice has been given shall, unless converted into Common Stock pursuant to
the terms hereof, become due and payable on the date and at the place or places stated in such
notice at the Redemption Price, and on and after said date (unless the Company shall default in the
deposit of the amount of money sufficient to redeem such Notes) interest on the Notes or portion of
Notes so called for redemption shall cease to accrue and such Notes shall cease at the close of
business on the Business Day immediately preceding the date fixed for redemption to be convertible
into Common Stock and, except as provided in Sections 8.5 and 13.4, to be entitled to any benefit
or security under this Indenture, and the holders thereof shall have no right in respect of such
Notes except the right to receive the Redemption Price. On presentation and surrender of such
Notes at a place of payment specified in said Redemption Notice, the said Notes or the specified
portions thereof to be redeemed shall be paid and redeemed by the Company at the Redemption Price;
provided that, if the applicable redemption date is an Interest Payment Date, the
semi-annual payment of interest becoming due on such date shall be payable to the holders of such
Notes registered as such on the relevant record date subject to the terms and provisions of Section
2.3.



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



Notwithstanding the foregoing, the Company shall not redeem any Notes or send any notice of
optional redemption during the continuance of a default in payment of interest or premium on the
Notes or of any Event of Default. If any Note called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and premium, if any, shall, until paid or duly
provided for, bear interest from the date fixed for redemption at the rate borne by the Note and
such Note shall remain convertible into Common Stock until the principal and premium, if any, shall
have been paid or duly provided for.



Section 3.4 Conversion Arrangement on Call for Redemption



In connection with any redemption of Notes, the Company may arrange for the purchase and
conversion of any Notes not converted prior to the expiration of such conversion right by an
agreement with one or more investment bankers or other purchasers to purchase such Notes by paying
to the Trustee in trust for the Noteholders, on or before the date fixed for redemption, an amount
not less than the applicable redemption price and interest accrued to the date fixed for
redemption, of such Notes. Notwithstanding anything to the contrary contained in this Article III,
the obligation of the Company to pay the redemption price of such Notes and interest accrued to,
but excluding, the date fixed for redemption, shall be deemed to be satisfied and discharged to the
extent such amount is so paid by such purchasers to such Noteholders. If such an agreement is
entered into, a copy of which, certified as true and correct by the Secretary or Assistant
Secretary of the Company will be filed with the Trustee prior to the date fixed for redemption, any
Notes not duly surrendered for conversion by the holders thereof may, at the option of the Company,
be deemed, to the fullest extent permitted by law, acquired by such purchasers from such holders
and (notwithstanding anything to the contrary contained in Article XV) surrendered by such
purchasers for conversion, all as of immediately prior to the close of business on the date fixed
for redemption (and the right to convert any such Notes shall be deemed to have been extended
through such time), subject to payment of the above amount as aforesaid. At the written direction
of the Company, the Trustee shall hold and dispose of any such amount paid to it in the same manner
as it would monies deposited with it by the Company for the redemption of Notes. Without the
Trustee’s prior written consent, no arrangement between the Company and such purchasers for the
purchase and conversion of any Notes shall increase or otherwise affect any of the powers, duties,
responsibilities or obligations of the Trustee as set forth in this Indenture, and the Company
agrees to indemnify the Trustee from, and hold it harmless against, any loss, liability or expense
arising out of or in connection with any such arrangement for the purchase and conversion of any
Notes between the Company and such purchasers, including the costs and expenses incurred by the
Trustee in the defense of any claim or liability arising out of or in connection with the exercise
or performance of any of its powers, duties, responsibilities or obligations under this Indenture.



ARTICLE IV




[RESERVED]




ARTICLE V




PARTICULAR COVENANTS OF THE COMPANY




Section 5.1 Payment of Principal, Premium and Interest



The Company covenants and agrees that it will duly and punctually pay or cause to be paid the
principal of and premium, if any, and interest on each of the Notes at the places, at the
respective times and in the manner provided herein and in the Notes. Share Delivery Damages paid
pursuant to Section 15.2, if any, shall be paid within ten (10) Business Days of the date from
which such Share Delivery Damages accrued pursuant to Section 15.2. Liquidated Damages on the
Notes paid pursuant to Section 2(f) of the Registration Rights Agreement, if any, shall be paid at
the times and in the manner provided therein. All payments shall be considered made on the date
due if on such date the Company has deposited (in the manner provided in Section 3.2 and Section
5.4(a)) with the Trustee or with one or more paying agents (or, if the Company is acting as its own
paying agent, has set aside, segregated and is holding in trust as provided in Section 5.4) an
amount of money sufficient to make such payment.



Section 5.2 Maintenance of Office or Agency



The Company will maintain in the City of Minneapolis, Minnesota, an office or agency where the
Notes may be presented for registration of transfer or exchange or for presentation for payment or
for conversion, redemption or repurchase and where notices and demands to or upon the Company in
respect of the Notes and this Indenture may be served, which may be the Corporate Trust Office of
the Trustee. The Company will give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency not designated or appointed by the Trustee. If at
any time the Company shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the Corporate Trust Office of the Trustee.



The Company may also from time to time designate one or more other offices or agencies where
the Notes may be presented or surrendered for any or all such purposes and may from time to time
rescind such designations; provided that no such designation or rescission shall in any
manner relieve the Company of its obligation to maintain an office or agency in Minneapolis,
Minnesota, 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 initially designates the Trustee as paying agent, Note Registrar, Custodian
and conversion agent and the office or agency of the Trustee in Minneapolis, Minnesota, Attention:
Corporate Trust Services, as one such office or agency of the Company for each of the aforesaid
purposes.



So long as the Trustee is the Note Registrar, the Trustee agrees to send, or cause to be sent,
the notices set forth in Section 8.10(a) and the third paragraph of Section 8.11.



Section 5.3 Appointments to Fill Vacancies in Trustee’s OfficeThe Company, whenever
necessary to avoid or fill a vacancy in the office of Trustee, will appoint, in the manner provided
in Section 8.10, a Trustee, so that there shall at all times be a Trustee hereunder.



Section 5.4 Provisions as to Paying Agent




(a) If the Company shall appoint a paying agent other than the Trustee or if the
Trustee shall appoint such a paying agent, it will cause such paying agent to execute and
deliver to the Trustee an instrument in which such agent shall agree with the Trustee,
subject to the provisions of this Section 5.4:




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




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




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




The Company shall, on or before each due date of the principal of, premium, if any, or
interest on the Notes, deposit with the paying agent a sum sufficient to pay such principal,
premium, if any, or interest, and (unless such paying agent is the Trustee) the Company will
promptly notify the Trustee of any failure to take such action, provided that if such
deposit is made on the due date, such deposit must be received by the paying agent by
10:00 a.m., New York City time, on such date.




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




(c) Anything in this Section 5.4 to the contrary notwithstanding, the Company may, at
any time, for the purpose of obtaining a satisfaction and discharge of this Indenture, or
for any other reason, pay or cause to be paid to the Trustee all sums held in trust by the
Company or any paying agent hereunder as required by this Section 5.4, such sums to be held
by the Trustee upon the trusts herein contained and upon such payment by the Company or any
paying agent to the Trustee, the Company or such paying agent shall be released from all
further liability with respect to such sums.




(d) Anything in this Section 5.4 to the contrary notwithstanding, the agreement to hold
sums in trust as provided in this Section 5.4 is subject to Sections 13.3 and 13.4.



Section 5.5 Existence




(a) Subject to Article XII, the Company will do or cause to be done all things
necessary to preserve and keep in full force and effect its corporate existence.




(b) The Company will cause all properties used or useful in the conduct of its business
to be maintained and kept in good condition, repair and working order (normal wear and tear
excepted) and supplied with all necessary equipment and will cause to be made all necessary
repairs, renewals, replacements, betterments and improvements thereof, all as in the
judgment of the Company may be necessary so that the business carried on in connection
therewith may be properly conducted at all times; provided that nothing in this Section
shall prevent the Company from discontinuing the operation or maintenance of any of such
properties if such discontinuance is, in the judgment of the Company, desirable in the
conduct of its business or the business of any subsidiary and not disadvantageous in any
material respect to the Noteholders.




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



Section 5.6 Information Requirement




(a) On or after the Exchange Act Filing Deadline and within the period prior to the
expiration of the holding period applicable to sales thereof under Rule 144(k) under the
Securities Act (or any successor provision), the Company covenants and agrees that it shall,
during any period in which it is not subject to Section 13 or 15(d) under the Exchange Act,
make available to any holder or beneficial holder of Notes, in each case which continue to
be Restricted Securities, in connection with any sale thereof and any prospective purchaser
of Notes from such holder or beneficial holder, the information required pursuant to
Rule 144A(d)(4) under the Securities Act upon the request of any holder or beneficial holder
of the Notes and it will take such further action as any holder or beneficial holder of such
Notes may reasonably request in connection with qualification of such sale for exemption
from registration under Rule 144A.




(b) From and after the date upon which the Company has filed the Exchange Act Reports,
during any period in which it is subject to Section 13 or 15(d) under the Exchange Act, the
Company shall file with the Commission all reports required to be filed by the Company in
accordance with Section 13, 14 or 15(d) under the Exchange Act at the times and in the
manner provided pursuant to such Act.



Section 5.7 Stay, Extension and Usury Laws



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



Section 5.8 Compliance Certificate



The Company shall deliver to the Trustee within one hundred twenty (120) days after the end of
each fiscal year of the Company (beginning with the fiscal year ending on December 31, 2006) an
Officer’s Certificate, signed by the principal executive, principal financial officer or principal
accounting officer of the Company, stating whether or not to the best of such person’s knowledge
the signers know of any default or Event of Default that occurred during such period. Such
Officer’s Certificate shall describe in reasonable detail the default or Event of Default, if any,
and its status.



The Company shall deliver to the Trustee, as soon as possible and in any event within three
(3) Business Days after the Company becomes aware of the occurrence of any Event of Default or an
event which, with notice or the lapse of time or both, would constitute an Event of Default, an
Officer’s Certificate setting forth the details of such Event of Default or default and the action
which the Company proposes to take with respect thereto.



Section 5.9 Further Instruments and Acts



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



Section 5.10 Notice of Certain Events




(a) The Company will promptly notify the Trustee as soon as practicable (i) of any
failure of the Company to meet the requirements of Section 2.3(b) or Section 2.3(c) and the
resulting interest rate adjustment pursuant to Section 2.3(d) and (ii) when the Notes are
listed on any stock exchange or automated quotation system and when any such listing is
discontinued.




(b) The Company shall deliver to the Trustee, as soon as possible and in any event
within ten (10) Business Days after the Company becomes aware of the occurrence of any Event
of Default, an Officer’s Certificate setting forth the details of such Event of Default and
the action which the Company proposes to take with respect thereto.



Section 5.11 Incurrence of Indebtedness



Unless and until the aggregate principal amount of the Notes outstanding is less than One
Million United States Dollars ($1,000,000), neither the Company, nor any of its Subsidiaries, shall
incur, guarantee, assume or suffer to exist any Indebtedness that is senior to or pari passu with
the Notes in excess of the Debt Limitation, without the prior written consent of 66 2/3% in
aggregate principal amount of Notes then outstanding, other than (i) the incurrence by the Company
of Indebtedness represented by the Notes and (ii) Permitted Indebtedness.



Section 5.12 Existence of Liens



Unless and until the aggregate principal amount of the Notes outstanding is less than One
Million United States Dollars ($1,000,000), the Company shall not, and the Company shall not permit
any of its Subsidiaries to allow or suffer to exist any mortgage, lien, pledge, charge, security
interest or other encumbrance upon or in any property or assets (including accounts and contract
rights) owned by the Company or any of its Subsidiaries (collectively, “Liens”) other than
Permitted Liens.



Section 5.13 Restricted Payments



Unless and until the aggregate principal amount of the Notes is less than One Million United
States Dollars ($1,000,000), the Company shall not, and the Company shall not permit any of its
Subsidiaries to, redeem, defease, repurchase, repay or make any payments in respect of, by the
payment of cash or cash equivalents any Permitted Subordinated Indebtedness if at the time such
payment is due or is otherwise made or, after giving effect to such payment, an Event of Default
has occurred and is continuing under the Notes.



ARTICLE VI




NOTEHOLDERS’ LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE




Section 6.1 Noteholders Lists



The Company covenants and agrees that it will furnish or cause to be furnished to the Trustee,
semi-annually, not more than fifteen (15) days after each May 1 and November 1 in each year
beginning with November 1, 2006 and at such other times as the Trustee may request in writing,
within thirty (30) days after receipt by the Company of any such request (or such lesser time as
the Trustee may reasonably request in order to enable it to timely provide any notice to be
provided by it hereunder), a list in such form as the Trustee may reasonably require of the names
and addresses of the holders of Notes as of a date not more than fifteen (15) days (or such other
date as the Trustee may reasonably request in order to so provide any such notices) prior to the
time such information is furnished, except that no such list need be furnished so long as the
Trustee is acting as Note Registrar.



Section 6.2 Preservation and Disclosure of Lists




(a) The Trustee shall preserve, in as current a form as is reasonably practicable, all
information as to the names and addresses of the holders of Notes contained in the most
recent list furnished to it as provided in Section 6.1 or maintained by the Trustee in its
capacity as Note Registrar, if so acting. The Trustee may destroy any list furnished to it
as provided in Section 6.1 upon receipt of a new list so furnished.




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




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



Section 6.3 Reports by Trustee




(a) After this Indenture has been qualified under the Trust Indenture Act, the Trustee
shall transmit to holders of Notes such reports concerning the Trustee and its actions under
this Indenture as may be required pursuant to the Trust Indenture Act at the times and in
the manner provided pursuant thereto. If required by Section 313(a) of the Trust Indenture
Act, the Trustee shall, within sixty (60) days after each May 15 following the date of this
Indenture deliver to holders a brief report, dated as of such May 15 which complies with the
provisions of such Section 313(a).




(b) A copy of such report shall, at the time of such transmission to holders of Notes,
be filed by the Trustee with each stock exchange and automated quotation system upon which
the Notes are listed, if any, and with the Company. The Company will promptly notify the
Trustee as soon as practicable when the Notes are listed on any stock exchange or automated
quotation system and when any such listing is discontinued.



Section 6.4 Reports by Company




(a) After this Indenture has been qualified under the Trust Indenture Act, the Company
shall file with the Trustee and the Commission, and transmit to holders of Notes, such
information, documents and other reports and such summaries thereof, as may be required
pursuant to the Trust Indenture Act at the times and in the manner provided pursuant to such
Act; provided that any such information, documents or reports required to be filed
with the Commission pursuant to Section 13 or 15(d) of the Exchange Act shall be filed with
the Trustee within fifteen (15) days after the same is so required to be filed with the
Commission.




(b) During any period in which the Company is not subject to Section 13 or 15(d) under
the Exchange Act on or after the Exchange Act Filing Deadline, the Company will deliver to
the Trustee (a) as soon as available and in any event within ninety (90) days after the end
of each fiscal year of the Company (i) a consolidated balance sheet of the Company and its
Subsidiaries as of the end of such fiscal year and the related consolidated statements of
operations, shareholders’ equity and cash flows for such fiscal year, all reported on by an
independent public accountant of nationally recognized standing and (ii) a report containing
a management’s discussion and analysis of the financial condition and results of operations
and a description of the business and properties of the Company and (b) as soon as available
and in any event within forty-five (45) days after the end of each of the first three
quarters of each fiscal year of the Company (i) an unaudited consolidated balance sheet of
the Company and its Subsidiaries as of the end of such fiscal quarter and the related
consolidated statements of operations, shareholders’ equity and cash flows for such fiscal
quarter and (ii) a report containing a management’s discussion and analysis of the financial
condition and results of operations of the Company for such quarter; provided that the
foregoing statements and reports shall not be required for any fiscal year or quarter, as
the case may be, with respect to which the Company files or expects to file with the Trustee
an annual report or quarterly report, as the case may be, pursuant to the preceding
paragraph of this Section 6.4. 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 Officer’s
Certificates).



ARTICLE VII




DEFAULTS AND REMEDIES




Section 7.1 Events of Default



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




(a) the Company shall default in the payment when due of (i) any installment of
interest, Default Interest, Share Delivery Damages or Liquidated Damages, and such default
shall continue for twenty (20) calendar days after the due date thereof, (ii) the principal
of and premium, if any, on any of the Notes either at maturity or in connection with any
conversion, redemption, by declaration or otherwise, or (iii) the Repurchase Price in
respect of any Note on the Repurchase Date therefor in accordance with the provisions of
Article XVI; or




(b) failure on the part of the Company duly to observe or perform any other of the
covenants on the part of the Company in the Notes or in this Indenture (other than default
in performance of a covenant that is specifically dealt with elsewhere in this Section)
including, without limitation, (i) failure by the Company to deliver shares of Common Stock
required to be delivered upon conversion of a Note in accordance with Article XV, or (ii)
failure on the part of the Company to provide a written notice of a Repurchase Event in
accordance with Section 16.2, and in any such case the continuance of such failure for a
period of twenty (20) days after the date on which written notice of such failure,
specifying such default and requiring the Company to remedy the same and stating that such
notice is a “Notice of Default” hereunder, shall have been given to the Company by the
Trustee, or to the Company and a Responsible Officer of the Trustee by the holders of not
less than 20% in aggregate principal amount of the Notes at the time outstanding determined
in accordance with Section 9.4; or




(c) failure on the part of the Company or any Significant Subsidiary to make any
payment at maturity, including any applicable grace period, in respect of indebtedness of,
or guaranteed or assumed by, the Company or any Significant Subsidiary, in a principal
amount then outstanding in excess of Two Million Five Hundred Thousand United States Dollars
($2,500,000), and the continuance of such failure for a period of fifteen (15) days after
there shall have been given, by registered or certified mail, to the Company by the Trustee
(provided, however, that the Trustee will not be deemed to have knowledge of such nonpayment
unless either (1) a Responsible Officer of the Trustee has actual knowledge of such
nonpayment or (2) the Trustee has received written notice thereof from the Company, from any
holder of the Notes, from the holder of any such indebtedness or from the trustee under the
agreement or instrument relating to such indebtedness) or to the Company and a Responsible
Officer of the Trustee by the holders of not less than 20% in aggregate principal amount of
the Notes then outstanding, a written notice specifying such default and requiring the
Company to cause such default to be cured or waived and stating that such notice is a
“Notice of Default” hereunder; or




(d) default on the part of the Company or any Significant Subsidiary with respect to
any Indebtedness of, or guaranteed or assumed by, the Company or any Significant Subsidiary,
which default results in the acceleration of indebtedness in a principal amount then
outstanding in excess of Two Million Five Hundred Thousand United States Dollars
($2,500,000), and such indebtedness shall not have been discharged or such acceleration
shall not have been rescinded or annulled for a period of fifteen (15) days after there
shall have been given, by registered or certified mail, to the Company by the Trustee
(provided, however, that the Trustee will not be deemed to have knowledge of such default
unless either (1) a Responsible Officer of the Trustee has actual knowledge of such default
or (2) the Trustee has received written notice thereof from the Company, from any holder of
the Notes, from the holder of any such Indebtedness or from the trustee under the agreement
or instrument relating to such Indebtedness) or to the Company and a Responsible Officer of
the Trustee by the holders of not less than 20% in aggregate principal amount of the Notes
then outstanding, a written notice specifying such default and requiring the Company to
cause such indebtedness to be discharged or cause such default to be cured or waived or such
acceleration to be rescinded or annulled and stating that such notice is a “Notice of
Default” hereunder; or




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




(f) an involuntary case or other proceeding shall be commenced against the Company or
any Significant Subsidiary seeking liquidation, reorganization or other relief with respect
to it or its debts under any bankruptcy, insolvency or other similar law now or hereafter in
effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other
similar official of it or any substantial part of its property, and such involuntary case or
other proceeding shall remain undismissed and unstayed for a period of sixty (60)
consecutive days; or




(g) any of the representations or warranties made by the Company herein or in the
Transaction Documents shall be false or misleading in any material respect at the time made
and such condition (to the extent capable of being cured) shall continue uncured for a
period of ten (10) Business Days after there shall have been given, by registered or
certified mail, to the Company and a Responsible Officer of the Trustee by the holders of
not less than 20% in aggregate principal amount of the Notes then outstanding, a written
notice specifying such default and requiring the Company to cause such default to be cured
or waived and stating that such notice is a “Notice of Default” hereunder; or




(h) the Company shall fail to duly observe or perform any of the covenants on the part
of the Company in the Transaction Documents (other than the Notes and this Indenture), and
such failure shall continue for twenty (20) days after there shall have been given, by
registered or certified mail, to the Company and a Responsible Officer of the Trustee by the
holders of not less than 20% in aggregate principal amount of the Notes then outstanding, a
written notice specifying such default and requiring the Company to cause such default to be
cured or waived and stating that such notice is a “Notice of Default” hereunder; or




(i) one or more final judgments or final arbitration awards involving, individually or
in the aggregate, liability (to the extent not covered by independent third-party insurance)
of the Company or Significant Subsidiary in excess of Two Million Five Hundred Thousand
United States Dollars ($2,500,000) shall have been entered against the Company or
Significant Subsidiary and shall remain outstanding at any one time unsatisfied, unvacated,
unwaived, undischarged and unstayed for a period of sixty (60) days after entry thereof; or




(j) at any time following the tenth (10th) consecutive Trading Day that the
percentage equal to (x) the number of shares of Common Stock authorized and reserved for
issuance by the Company, divided by (y) the number of shares of Common Stock issuable upon
conversion of the Notes in full (without regard to any limitations on conversion set forth
herein or otherwise) shall fail to be greater than or equal to 110%; or




(k) from and after the date on which the Registration Statement required under the
Registration Rights Agreement becomes effective, the suspension from trading or failure of
the Common Stock to be listed on the Principal Market or on an Eligible Market for a period
of five (5) consecutive Trading Days or for more than an aggregate of ten (10) Trading Days
in any 365-day period;



then, and in each and every such case (other than an Event of Default specified in Section 7.1(e)
or (f) with respect to the Company), unless the principal of all of the Notes shall have already
become due and payable, and unless the Event of Default shall have been waived in writing in
accordance with the provisions of Section 7.7, either the Trustee or the holders of not less than
20% in aggregate principal amount of the Notes then outstanding hereunder determined in accordance
with Section 9.4, by notice in writing to the Company (and to the Trustee if given by Noteholders),
may declare the principal of and premium, if any, on all the Notes and the interest accrued thereon
(including Liquidated Damages to the extent accrued and unpaid) to be due and payable immediately,
and upon any such declaration the same shall become and shall be immediately due and payable,
anything in this Indenture or in the Notes contained to the contrary notwithstanding. If an Event
of Default specified in Sections 7.1(e) or (f) occurs and is continuing with respect to the
Company, the principal of all the Notes and the interest accrued thereon (including Liquidated
Damages to the extent accrued and unpaid) shall be immediately due and payable. In addition to the
foregoing, upon an Event of Default and only for so long as such Event of Default is continuing,
the rate of interest on the Notes shall, be increased by five percent (5%) per annum (i.e., from
5.5% to 10.5% per annum), or if less, increased to the maximum interest rate then permitted by
applicable law. Any such interest which is not paid when due shall, to the maximum extent
permitted by law, accrue interest until paid at the rate from time to time applicable to the
interest on the Notes. Notwithstanding the foregoing if, at any time after the principal of the
Notes shall have been so declared due and payable, and before any judgment or decree for the
payment of the monies due shall have been obtained or entered as hereinafter provided, the Company
shall pay or shall deposit with the Trustee a sum sufficient to pay all matured installments of
interest upon all Notes and the principal of and premium, if any, on any and all Notes which shall
have become due otherwise than by acceleration (with interest on overdue installments of interest
(to the extent that payment of such interest is enforceable under applicable law) and on such
principal and premium, if any, at the rate borne by the Notes, to the date of such payment or
deposit) and amounts due to the Trustee pursuant to Section 8.6, and if any and all defaults under
this Indenture, other than the nonpayment of principal of and premium, if any, and accrued interest
on Notes which shall have become due by acceleration, shall have been cured or waived pursuant to
Section 7.7, then and in every such case the holders of 66 2/3% in aggregate principal amount of
the Notes then outstanding, by written notice to the Company and to the Trustee, may waive all
defaults or Events of Default and rescind and annul such acceleration and its consequences; but no
such waiver or rescission and annulment shall extend to or shall affect any subsequent default or
Event of Default, or shall impair any right consequent thereon. The Company shall notify the
Responsible Officer of the Trustee, within three (3) Business Days of becoming aware thereof, of
any default or Event of Default and shall deliver to the Trustee a statement specifying such
default or Event of Default and the action the Company has taken, is taking or proposes to take
with respect thereto.



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



Section 7.2 Payments of Notes on Default; Suit Therefor



The Company covenants that (a) in case default shall be made in the payment by the Company of
any installment of interest upon any of the Notes as and when the same shall become due and
payable, and such default shall have continued for a period of thirty (30) days, or (b) in case
default shall be made in the payment of the principal of or premium, if any, on any of the Notes as
and when the same shall have become due and payable, whether at maturity of the Notes or in
connection with any redemption or repurchase, by declaration under this Indenture or otherwise,
then, upon written demand of the Trustee, the Company will pay to the Trustee, for the benefit of
the holders of the Notes, the whole amount that then shall have become due and payable on all such
Notes for principal and premium, if any, or interest, or both, as the case may be, with interest
upon the overdue principal and premium, if any, and (to the extent that payment of such interest is
enforceable under applicable law) upon the overdue installments of interest at the rate borne by
the Notes; and, in addition thereto, such further amount as shall be sufficient to cover the costs
and expenses of collection, including reasonable compensation to the Trustee, its agents, attorneys
and counsel, and any expenses or liabilities incurred by the Trustee hereunder other than through
its negligence or bad faith. Until such demand by the Trustee, the Company may pay the principal
of and premium, if any, and interest on the Notes to the registered holders, whether or not the
Notes are overdue.



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



In case there shall be pending proceedings for the bankruptcy or for the reorganization of the
Company under Title 11 of the United States Code, or any other applicable law, or in case a
receiver, assignee or trustee in bankruptcy or reorganization, liquidator, sequestrator or similar
official shall have been appointed for or taken possession of the Company, the property of the
Company, the Trustee, irrespective of whether the principal of the Notes shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand pursuant to the provisions of this Section 7.2, shall be entitled and
empowered, by intervention in such proceedings or otherwise, to file and prove a claim or claims
for the whole amount of principal, premium, if any, and interest (including Liquidated Damages, if
any) owing and unpaid in respect of the Notes, and, in case of any judicial proceedings, to file
such proofs of claim and other papers or documents and to take such other actions as it may deem
necessary or advisable in order to have the claims of the Trustee and of the Noteholders allowed in
such judicial proceedings relative to the Company, its creditors, or its property, and to collect
and receive any monies or other property payable or deliverable on any such claims, and to
distribute the same after the deduction of any amounts due the Trustee under Section 8.6; and any
receiver, assignee or trustee in bankruptcy or reorganization, liquidator, custodian or similar
official is hereby authorized by each of the Noteholders to make such payments to the Trustee, and,
in the event that the Trustee shall consent to the making of such payments directly to the
Noteholders, to pay to the Trustee any amount due it for reasonable compensation, expenses,
advances and disbursements, including agents and counsel fees incurred by it up to the date of such
distribution. To the extent that such payment of reasonable compensation, expenses, advances and
disbursements out of the estate in any such proceedings shall be denied for any reason, payment of
the same shall be secured by a lien on, and shall be paid out of, any and all distributions,
dividends, monies, securities and other property which the holders of the Notes may be entitled to
receive in such proceedings, whether in liquidation or under any plan of reorganization or
arrangement or otherwise.



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



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



Section 7.3 Application of Monies Collected by Trustee



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




First: To the payment of all amounts due the Trustee under Section 8.6;




Second: In case the principal of the outstanding Notes shall not have become due and be
unpaid, to the payment of interest on the Notes in default in the order of the maturity of
the installments of such interest, with interest (to the extent that such interest has been
collected by the Trustee) upon the overdue installments of interest at the rate borne by the
Notes, such payments to be made ratably to the Persons entitled thereto;




Third: In case the principal of the outstanding Notes shall have become due, by
declaration or otherwise, and be unpaid, to the payment of the whole amount then owing and
unpaid upon the Notes for principal and premium, if any, and interest, with interest on the
overdue principal and premium, if any, and (to the extent that such interest has been
collected by the Trustee) upon overdue installments of interest at the rate borne by the
Notes; and in case such monies shall be insufficient to pay in full the whole amounts so due
and unpaid upon the Notes, then to the payment of such principal and premium, if any, and
interest without preference or priority of principal and premium, if any, over interest, or
of interest over principal and premium, if any, or of any installment of interest over any
other installment of interest, or of any Note over any other Note, ratably to the aggregate
of such principal and premium, if any, and accrued and unpaid interest; and



	 	 	 
	Fourth:

Section 7.4

	 	To the payment of the remainder, if any, to the Company.

Proceedings by Noteholder
	
 
	 	 






Subject to the last two paragraphs of this Section 7.4, no holder of any Note shall have any
right by virtue of or by availing of any provision of this Indenture to institute any suit, action
or proceeding in equity or at law upon or under or with respect to this Indenture, or for the
appointment of a receiver, trustee, liquidator, custodian or other similar official, or for any
other remedy hereunder, unless such holder previously shall have given to the Trustee written
notice of an Event of Default and of the continuance thereof, as hereinbefore provided, and unless
also the holders of not less than 20% in aggregate principal amount of the Notes then outstanding
shall have made written request upon the Trustee to institute such action, suit or proceeding in
its own name as Trustee hereunder and shall have offered to the Trustee such indemnity as may be
reasonably satisfactory to the Trustee against the costs, expenses and liabilities to be incurred
therein or thereby, and the Trustee for sixty (60) days after its receipt of such notice, request
and offer of indemnity, shall have neglected or refused to institute any such action, suit or
proceeding and no direction inconsistent with such written request shall have been given to the
Trustee pursuant to Section 7.7; it being understood and intended, and being expressly covenanted
by the taker and holder of every Note with every other taker and holder and the Trustee, that no
one or more holders of Notes shall have any right in any manner whatever by virtue of or by
availing of any provision of this Indenture to affect, disturb or prejudice the rights of any other
holder of Notes, or to obtain or seek to obtain priority over or preference to any other such
holder, or to enforce any right under this Indenture, except in the manner herein provided and for
the equal, ratable and common benefit of all holders of Notes (except as otherwise provided
herein). For the protection and enforcement of this Section 7.4, each and every Noteholder and the
Trustee shall be entitled to such relief as can be given either at law or in equity.



Notwithstanding any other provision of this Indenture and any provision of any Note, the right
of any holder of any Note to receive payment of the principal of and premium, if any, and interest
(including Liquidated Damages to the extent accrued but unpaid) on such Note, on or after the
respective due dates expressed in such Note, or to institute suit for the enforcement of any such
payment on or after such respective dates against the Company shall not be impaired or affected
without the consent of such holder.



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



Section 7.5 Proceedings by Trustee



If an Event of Default occurs and is continuing, the Trustee may in its discretion proceed to
protect and enforce the rights vested in it by this Indenture by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and enforce any of such rights,
either by suit in equity or by action at law or by proceeding in bankruptcy or otherwise, whether
for the specific enforcement of any covenant or agreement contained in this Indenture or in aid of
the exercise of any power granted in this Indenture, or to enforce any other legal or equitable
right vested in the Trustee by this Indenture or by law.



Section 7.6 Remedies Cumulative and Continuing



Except as provided in the last paragraph of Section 2.6, all powers and remedies given by this
Article VII to the Trustee or to the Noteholders shall, to the extent permitted by law, be deemed
cumulative and not exclusive of any thereof or of any other powers and remedies available to the
Trustee or the holders of the Notes, by judicial proceedings or otherwise, to enforce the
performance or observance of the covenants and agreements contained in this Indenture, and no delay
or omission of the Trustee or of any holder of any of the Notes to exercise any right or power
accruing upon any default or Event of Default occurring and continuing as aforesaid shall impair
any such right or power, or shall be construed to be a waiver of any such default or any
acquiescence therein; and, subject to the provisions of Section 7.4, every power and remedy given
by this Article VII or by law to the Trustee or to the Noteholders may be exercised from time to
time, and as often as shall be deemed expedient, by the Trustee or by the Noteholders.



Section 7.7 Direction of Proceedings and Waiver of Defaults by 66 2/3% of Noteholders



The holders of 66 2/3% in aggregate principal amount of the Notes at the time outstanding
determined in accordance with Section 9.4 shall have the right to direct the time, method, and
place of conducting any proceeding for any remedy available to the Trustee or exercising any trust
or power conferred on the Trustee; provided, however, that (a) such direction shall
not be in conflict with any rule of law or with this Indenture, and (b) the Trustee may take any
other action deemed proper by the Trustee which is not inconsistent with such direction. The
holders of not less than 66 2/3% in aggregate principal amount of the Notes at the time outstanding
determined in accordance with Section 9.4 may on behalf of the holders of all of the Notes waive
any past or existing default or Event of Default hereunder and its consequences except (i) a
default in the payment of interest or premium, if any, on, or the principal of, the Notes when due,
(ii) a failure by the Company to convert any Notes into Common Stock or (iii) a default in respect
of a covenant or provisions hereof which under Article XI cannot be modified or amended without the
consent of all affected holders of Notes then outstanding. Upon any such waiver the Company, the
Trustee and the holders of the Notes shall be restored to their former positions and rights
hereunder; said default or Event of Default shall for all purposes of the Notes and this Indenture
be deemed to have been cured and to be not continuing; but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent thereon.



Section 7.8 Notice of Defaults



The Trustee shall, within ninety (90) days after the Trustee obtains knowledge of the
occurrence of a default under this Indenture, send to all Noteholders, as the names and addresses
of such holders appear upon the Note Register, notice of all defaults actually known to a
Responsible Officer, unless such defaults shall have been cured or waived before the giving of such
notice; and provided that, except in the case of default in the payment of the principal of, or
premium, if any, or interest (including Liquidated Damages to the extent accrued but unpaid) on any
of the Notes, including without limiting the generality of the foregoing any default in the payment
of any Repurchase Price or in the payment of any amount due in connection with any redemption of
Notes, then in any such event the Trustee shall be protected in withholding such notice if and so
long as a trust committee of directors and/or Responsible Officers of the Trustee in good faith
determines that the withholding of such notice is in the interests of the Noteholders.



Section 7.9 Undertaking to Pay Costs



All parties to this Indenture agree, and each holder of any Note by his acceptance thereof
shall be deemed to have agreed, that any court may, in its discretion, require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any
action taken or omitted by it as Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit and that such court may in its discretion assess
reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in
such suit, having due regard to the merits and good faith of the claims or defenses made by such
party litigant; provided that the provisions of this Section 7.9 shall not apply to any
suit instituted by the Trustee, to any suit instituted by any Noteholder, or group of Noteholders,
holding in the aggregate more than 20% in principal amount of the Notes at the time outstanding
determined in accordance with Section 9.4, or to any suit instituted by any Noteholder for the
enforcement of the payment of the principal of or premium, if any, or interest (including
Liquidated Damages to the extent accrued but unpaid) on any Note (including, but not limited to,
the redemption price or Repurchase Price with respect to the Notes being redeemed or repurchased as
provided in this Indenture) on or after the due date expressed in such Note or to any suit for the
enforcement of the right to convert any Note in accordance with the provisions of Article XV.



Section 7.10 Delay or Omission Not Waiver



No delay or omission of the Trustee or of any holder of any Note to exercise any right or
remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a
waiver of any such Event of Default or any acquiescence therein. Every right and remedy given by
this Article VII or by law to the Trustee or to the holders of Notes may be exercised from time to
time, and as often as may be deemed expedient, by the Trustee or by the holders of Notes, as the
case may be.



ARTICLE VIII




CONCERNING THE TRUSTEE




Section 8.1 Duties and Responsibilities of Trustee



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



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




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




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




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




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




(c) the Trustee shall not be liable to any Noteholder with respect to any action taken
or omitted to be taken by it in good faith in accordance with the direction of the holders
of not less than 66 2/3% in principal amount of the Notes at the time outstanding determined
as provided in Section 9.4 relating to the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or power
conferred upon the Trustee, under this Indenture; and




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



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



Section 8.2 Reliance on Documents, Opinions, Etc.



Except as otherwise provided in Section 8.1:




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




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




(c) the Trustee may consult with counsel of its selection, and any advice of such
counsel or Opinion of Counsel as to matters of law shall be full and complete authorization
and protection in respect of any action taken or omitted by it hereunder in good faith and
in accordance with such advice or Opinion of Counsel if such counsel was selected with due
care;




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




(e) the Trustee shall not be bound to make any investigation into the facts or matters
stated in any resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture or other paper or document, but the
Trustee, in its reasonable discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled to examine the books, records and
premises of the Company, personally or by agent or attorney; provided,
however, that if the payment within a reasonable time to the Trustee of the costs,
expenses or liabilities likely to be incurred by it in the making of such investigation is,
in the opinion of the Trustee, not reasonably assured to the Trustee by the security
afforded to it by the terms of this Indenture, the Trustee may require indemnity reasonably
satisfactory to the Trustee from the Noteholders against such expenses or liability as a
condition to so proceeding; the reasonable expenses of every such examination shall be paid
by the Company or, if paid by the Trustee or any predecessor Trustee, shall be repaid by the
Company upon demand;




(f) the Trustee may execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents or attorneys and the Trustee shall not be
responsible for any misconduct or negligence on the part of any agent or attorney appointed
by it with due care hereunder;




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




(h) the Trustee shall not be deemed to have notice of any default or Event of Default
unless a Responsible Officer of the Trustee has actual knowledge thereof or unless written
notice of any event which is in fact such a default or Event of Default is received by the
Trustee at the Corporate Trust Office of the Trustee, and such notice references the Notes
and this Indenture and states that it is a “Notice of Default” hereunder;




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




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



In no event shall the Trustee be liable for any consequential loss or damage of any kind whatsoever
(including but not limited to lost profits), even if the Trustee has been advised of the likelihood
of such loss or damage and regardless of the form of action.



Section 8.3 No Responsibility for Recitals, Etc.



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



Section 8.4 Trustee, Paying Agents, Conversion Agents or Note Registrar May Own Notes



The Trustee, any paying agent, any conversion agent or Note Registrar, in its individual or
any other capacity, may become the owner or pledgee of Notes with the same rights it would have if
it were not Trustee, paying agent, conversion agent or Note Registrar.



Section 8.5 Monies to be Held in Trust



Subject to the provisions of Section 13.4, all monies received by the Trustee shall, until
used or applied as herein provided, be held in trust for the purposes for which they were received.
Money held by the Trustee in trust hereunder need not be segregated from other funds except to the
extent required by law. The Trustee shall be under no liability for interest on any money received
by it hereunder except as may be agreed in writing from time to time by the Company and the
Trustee.



Section 8.6 Compensation and Expenses of Trustee



The Company covenants and agrees to pay to the Trustee from time to time, and the Trustee
shall be entitled to, such compensation as the Company and the Trustee shall from time to time
agree in writing for all services rendered by it hereunder in any capacity (which shall not be
limited by any provision of law in regard to the compensation of a trustee of an express trust),
and the Company will pay or reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances reasonably incurred or made by the Trustee in accordance with any of the
provisions of this Indenture (including the reasonable compensation and the expenses and
disbursements of its agents and counsel and of all Persons not regularly in its employ) except any
such expense, disbursement or advance as may arise from its negligence, willful misconduct or bad
faith. The Company also covenants to indemnify the Trustee or any predecessor Trustee in any
capacity under this Indenture and its agents and any authenticating agent for, and to hold them
harmless against, any and all loss, damages, claims, liability or expense, including taxes (other
than those based upon, measured by or determined by the income of the Trustee), incurred without
negligence, willful misconduct or bad faith on the part of the Trustee or such agent or
authenticating agent, as the case may be, and arising out of or in connection with the acceptance
or administration of this trust or in any other capacity hereunder, including the costs and
expenses of defending themselves against any claim (whether asserted by the Company, a holder or
any other Person) of liability in the premises. The obligations of the Company under this
Section 8.6 to compensate or indemnify the Trustee and to pay or reimburse the Trustee for
expenses, disbursements and advances shall be secured by a lien upon all property and funds held or
collected by the Trustee as such, except, subject to the effect of Sections 4.3 and 7.5, funds held
in trust herewith for the benefit of the holders of particular Notes prior to the date of the
accrual of such unpaid compensation or indemnifiable claim. The obligation of the Company under
this Section 8.6 shall survive the satisfaction and discharge of this Indenture and the resignation
or removal of the Trustee. The indemnification provided in this Section 8.6 shall extend to the
officers, directors, agents and employees of the Trustee.



When the Trustee and its agents and any authenticating agent incur expenses or render services
after an Event of Default specified in Sections 7.1(e) or (f) occurs, the expenses and the
compensation for the services are intended to constitute expenses of administration under any
bankruptcy, insolvency or similar laws.



Section 8.7 Officer’s Certificate as Evidence



Except as otherwise provided in Section 8.1, whenever in the administration of the provisions
of this Indenture the Trustee shall deem it necessary or desirable that a matter be proved or
established prior to taking or omitting any action hereunder, such matter (unless other evidence in
respect thereof be herein specifically prescribed) may, in the absence of negligence, willful
misconduct or bad faith on the part of the Trustee, be deemed to be conclusively proved and
established by an Officer’s Certificate delivered to the Trustee, and such Officer’s Certificate,
in the absence of negligence, willful misconduct or bad faith on the part of the Trustee, shall be
full warrant to the Trustee for any action taken or omitted by it under the provisions of this
Indenture upon the faith thereof.



Section 8.8 Conflicting Interests of Trustee



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



Section 8.9 Eligibility of Trustee



There shall at all times be a Trustee hereunder that shall be a Person that is eligible
pursuant to the Trust Indenture Act to act as such and has a combined capital and surplus (together
with its corporate parent) of at least Fifty Million United States Dollars ($50,000,000). If such
Person publishes reports of condition at least annually, pursuant to law or to the requirements of
any supervising or examining authority, then for the purposes of this Section 8.9, the combined
capital and surplus of such Person shall be deemed to be its combined capital and surplus as set
forth in its most recent report of condition so published. If at any time the Trustee shall cease
to be eligible in accordance with the provisions of this Section 8.9, it shall resign immediately
in the manner and with the effect hereinafter specified in this Article VIII.



Section 8.10 Resignation or Removal of Trustee




(a) The Trustee may at any time resign by giving written notice of such resignation to
the Company and by sending notice thereof to the holders of Notes at their addresses as they
shall appear on the Note Register. Upon receiving such notice of resignation, the Company
shall promptly appoint a successor trustee by written instrument, in duplicate, executed by
order of the Board of Directors, one copy of which instrument shall be delivered to the
resigning Trustee and one copy to the successor trustee. If no successor trustee shall have
been so appointed and have accepted appointment sixty (60) days after the sending of such
notice of resignation to the Noteholders, the resigning Trustee may, at the expense of the
Company, petition any court of competent jurisdiction for the appointment of a successor
trustee, or any Noteholder who has been a bona fide holder of a Note or Notes for at least
six months may, subject to the provisions of Section 7.9, on behalf of himself and all
others similarly situated, petition any such court for the appointment of a successor
trustee. Such court may thereupon, after such notice, if any, as it may deem proper and
prescribe, appoint a successor trustee.




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




(1) the Trustee shall fail to comply with Section 8.8 within a reasonable time
after written request therefor by the Company or by any Noteholder who has been a
bona fide holder of a Note or Notes for at least six months, or




(2) the Trustee shall cease to be eligible in accordance with the provisions of
Section 8.9 and shall fail to resign after written request therefor by the Company
or by any such Noteholder, or




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




then, in any such case, the Company may by a Board Resolution remove the Trustee and appoint
a successor trustee by written instrument, in duplicate, executed by order of the Board of
Directors, one copy of which instrument shall be delivered to the Trustee so removed and one
copy to the successor trustee, or, subject to the provisions of Section 7.9, any Noteholder
who has been a bona fide holder of a Note or Notes for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent jurisdiction for
the removal of the Trustee and the appointment of a successor trustee. Such court may
thereupon, after such notice, if any, as it may deem proper and prescribe, remove the
Trustee and appoint a successor trustee.




(c) The holders of 66 2/3% in aggregate principal amount of the Notes at the time
outstanding may at any time remove the Trustee and nominate a successor trustee which shall
be deemed appointed as successor trustee unless within ten (10) days after notice to the
Company of such nomination the Company objects thereto, in which case the Trustee so removed
or any Noteholder, upon the terms and conditions and otherwise as in Section 8.10(a)
provided, may, at the expense of the Company, petition any court of competent jurisdiction
for an appointment of a successor trustee.




(d) Any resignation or removal of the Trustee and appointment of a successor trustee
pursuant to any of the provisions of this Section 8.10 shall become effective upon
acceptance of appointment by the successor trustee as provided in Section 8.11.




(e) If an instrument of acceptance by a successor Trustee shall not have been delivered
to the Trustee within thirty (30) days after the giving of such notice of removal, the
Trustee being removed may petition, at the expense of the Company, any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the Securities of
such series.



Section 8.11 Acceptance by Successor Trustee



Any successor trustee appointed as provided in Section 8.10 shall execute, acknowledge and
deliver to the Company and to its predecessor trustee an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the predecessor trustee shall become
effective and such successor trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, duties and obligations of its predecessor hereunder, with like
effect as if originally named as trustee herein; but, nevertheless, on the written request of the
Company or of the successor trustee, the trustee ceasing to act shall, upon payment of any amounts
then due it pursuant to the provisions of Section 8.6, execute and deliver an instrument
transferring to such successor trustee all the rights and powers of the trustee so ceasing to act.
Upon request of any such successor trustee, the Company shall execute any and all instruments in
writing for more fully and certainly vesting in and confirming to such successor trustee all such
rights and powers. Any trustee ceasing to act shall, nevertheless, retain a lien upon all property
and funds held or collected by such trustee as such, except for funds held in trust for the benefit
of holders of particular Notes, to secure any amounts then due it pursuant to the provisions of
Section 8.6.



No successor trustee shall accept appointment as provided in this Section 8.11 unless at the
time of such acceptance such successor trustee shall be qualified under the provisions of
Section 8.8 and be eligible under the provisions of Section 8.9.



Upon acceptance of appointment by a successor trustee as provided in this Section 8.11, the
Company shall send or cause to be sent notice of the succession of such trustee hereunder to the
holders of Notes at their addresses as they shall appear on the Note Register. If the Company
fails to send such notice within ten (10) days after acceptance of appointment by the successor
trustee, the successor trustee shall cause such notice to be sent at the expense of the Company.



Section 8.12 Succession by Merger, Etc.



Any corporation or other entity into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any corporation or other entity succeeding
to all or substantially all of the corporate trust business of the Trustee (including the trust
created by this Indenture), shall be the successor to the Trustee hereunder without the execution
or filing of any paper or any further act on the part of any of the parties hereto, provided that
in the case of any corporation succeeding to all or substantially all of the corporate trust
business of the Trustee such corporation shall be qualified under the provisions of Section 8.8 and
eligible under the provisions of Section 8.9.



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



Section 8.13 Limitation on Rights of Trustee as Creditor



If and when the Trustee shall be or become a creditor of the Company, the Trustee shall be
subject to the provisions of the Trust Indenture Act regarding the collection of the claims against
the Company.



ARTICLE IX




CONCERNING THE NOTEHOLDERS




Section 9.1 Action by Noteholders



Whenever in this Indenture it is provided that the holders of a specified percentage in
aggregate principal amount of the Notes may take any action (including the making of any demand or
request, the giving of any notice, consent or waiver or the taking of any other action), the fact
that at the time of taking any such action, the holders of such specified percentage have joined
therein may be evidenced (a) by any instrument or any number of instruments of similar tenor
executed by Noteholders in person or by agent or proxy appointed in writing, or (b) by the record
of the holders of Notes voting in favor thereof at any meeting of Noteholders duly called and held
in accordance with the provisions of Article X, or (c) by a combination of such instrument or
instruments and any such record of such a meeting of Noteholders. Whenever the Company or the
Trustee solicits the taking of any action by the holders of the Notes, the Company or the Trustee
may fix in advance of such solicitation, a date as the record date for determining holders entitled
to take such action. The record date shall be not more than fifteen (15) days prior to the date of
commencement of solicitation of such action.



Section 9.2 Proof of Execution by Noteholders



Subject to the provisions of Sections 8.1, 8.2 and 10.5, proof of the execution of any
instrument by a Noteholder or his agent or proxy shall be sufficient if made in accordance with
such reasonable rules and regulations as may be prescribed by the Trustee or in such manner as
shall be satisfactory to the Trustee. The holding of Notes shall be proved by the Note Register or
by a certificate of the Note Registrar. The record of any Noteholders’ meeting shall be proved in
the manner provided in Section 10.6.



Section 9.3 Who Are Deemed Absolute Owners



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



Section 9.4 Company-Owned Notes Disregarded



In determining whether the holders of the requisite aggregate principal amount of Notes have
concurred in any direction, consent, waiver or other action under this Indenture, Notes that are
owned by the Company or by any Person directly or indirectly controlling or controlled by or under
direct or indirect common control with the Company shall be disregarded and deemed not to be
outstanding for the purpose of any such determination; provided that for the purposes of
determining whether the Trustee shall be protected in relying on any such direction, consent,
waiver or other action only Notes which a Responsible Officer actually knows are so owned shall be
so disregarded. Notes so owned which have been pledged in good faith may be regarded as
outstanding for the purposes of this Section 9.4 if the pledgee shall establish to the satisfaction
of the Trustee the pledgee’s right to vote such Notes and that the pledgee is not the Company, or a
Person directly or indirectly controlling or controlled by or under direct or indirect common
control with the Company. In the case of a dispute as to such right, any decision by the Trustee
taken upon the advice of counsel shall be full protection to the Trustee. Upon request of the
Trustee, the Company shall furnish to the Trustee promptly an Officer’s Certificate listing and
identifying all Notes, if any, known by the Company to be owned or held by or for the account of
any of the above described Persons; and, subject to Section 8.1, the Trustee shall be entitled to
accept such Officer’s Certificate as conclusive evidence of the facts therein set forth and of the
fact that all Notes listed therein are not outstanding for the purpose of any such determination.



Section 9.5 Revocation of Consents; Future Holders Bound



At any time prior to (but not after) the evidencing to the Trustee, as provided in
Section 9.1, of the taking of any action by the holders of the percentage in aggregate principal
amount of the Notes specified in this Indenture in connection with such action, any holder of a
Note which is shown by the evidence to be included in the Notes the holders of which have consented
to such action may, by filing written notice with the Trustee at its Corporate Trust Office and
upon proof of holding as provided in Section 9.2, revoke such action so far as concerns such Note.
Except as aforesaid, any such action taken by the holder of any Note shall be conclusive and
binding upon such holder and upon all future holders and owners of such Note and of any Notes
issued in exchange or substitution therefor, irrespective of whether any notation in regard thereto
is made upon such Note or any Note issued in exchange or substitution therefor.



Section 9.6 Communications by Holders with Other Holders



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



ARTICLE X




NOTEHOLDERS’ MEETINGS




Section 10.1 Purpose of Meetings



A meeting of Noteholders may be called at any time and from time to time pursuant to the
provisions of this Article X for any of the following purposes:




(1) to give any notice to the Company or to the Trustee or to give any directions to
the Trustee permitted under this Indenture, or to consent to the waiving of any default or
Event of Default hereunder and its consequences, or to take any other action authorized to
be taken by Noteholders pursuant to any of the provisions of Article VII;




(2) to remove the Trustee and nominate a successor trustee pursuant to the provisions
of Article VIII;




(3) to consent to the execution of an indenture or indentures supplemental hereto
pursuant to the provisions of Section 11.2;




(4) to take any other action authorized to be taken by or on behalf of the holders of
any specified aggregate principal amount of the Notes under any other provision of this
Indenture or under applicable law; or




(5) to take any other action authorized by this Indenture or under applicable law.



Section 10.2 Call of Meetings by Trustee



The Trustee may at any time call a meeting of Noteholders to take any action specified in
Section 10.1, to be held at such time and at such place as the Trustee shall determine. Notice of
every meeting of the Noteholders, setting forth the time and the place of such meeting and in
general terms the action proposed to be taken at such meeting and the establishment of any record
date pursuant to Section 9.1, shall be sent to holders of Notes at their addresses as they shall
appear on the Note Register. Such notice shall also be sent to the Company. Such notices shall be
sent not less than twenty (20) nor more than ninety (90) days prior to the date fixed for the
meeting.



Any meeting of Noteholders shall be valid without notice if the holders of all Notes then
outstanding are present in person or by proxy or if notice is waived before or after the meeting by
the holders of all Notes outstanding, and if the Company and the Trustee are either present by duly
authorized representatives or have, before or after the meeting, waived notice.



Section 10.3 Call of Meetings by Company or Noteholders



In case at any time the Company, pursuant to a resolution of its Board of Directors, or the
holders of at least 10% in aggregate principal amount of the Notes then outstanding, shall have
requested the Trustee to call a meeting of Noteholders, by written request setting forth in
reasonable detail the action proposed to be taken at the meeting, and the Trustee shall not have
sent the notice of such meeting within twenty (20) days after receipt of such request, then the
Company or such Noteholders may determine the time and the place for such meeting and may call such
meeting to take any action authorized in Section 10.1, by sending notice thereof as provided in
Section 10.2.



Section 10.4 Qualifications for Voting



To be entitled to vote at any meeting of Noteholders a Person shall (a) be a holder of one or
more Notes on the record date pertaining to such meeting or (b) be a Person appointed by an
instrument in writing as proxy by a holder of one or more Notes. The only Persons who shall be
entitled to be present or to speak at any meeting of Noteholders shall be the Persons entitled to
vote at such meeting and their counsel and any representatives of the Trustee and its counsel and
any representatives of the Company and its counsel.



Section 10.5 Regulations



Notwithstanding any other provisions of this Indenture, the Trustee may make such reasonable
regulations as it may deem advisable for any meeting of Noteholders, in regard to proof of the
holding of Notes and of the appointment of proxies, and in regard to the appointment and duties of
inspectors of votes, the submission and examination of proxies, certificates and other evidence of
the right to vote, and such other matters concerning the conduct of the meeting as it shall think
fit.



The Trustee shall, by an instrument in writing, appoint a temporary chairman of the meeting,
unless the meeting shall have been called by the Company or by Noteholders as provided in
Section 10.3, in which case the Company or the Noteholders calling the meeting, as the case may be,
shall in like manner appoint a temporary chairman. A permanent chairman and a permanent secretary
of the meeting shall be elected by vote of the holders of 66 2/3% in principal amount of the Notes
represented at the meeting and entitled to vote at the meeting.



Subject to the provisions of Section 9.4, at any meeting each Noteholder or proxyholder shall
be entitled to one vote for each One Thousand United States Dollars ($1,000) principal amount of
Notes held or represented by such Noteholder; provided, however, that no vote shall
be cast or counted at any meeting in respect of any Note challenged as not outstanding and ruled by
the chairman of the meeting to be not outstanding. The chairman of the meeting shall have no right
to vote other than by virtue of Notes held by him or instruments in writing as aforesaid duly
designating him as the proxy to vote on behalf of other Noteholders. Any meeting of Noteholders
duly called pursuant to the provisions of Section 10.2 or 10.3 may be adjourned from time to time
by the holders of 66 2/3% of the aggregate principal amount of Notes represented at the meeting,
whether or not constituting a quorum, and the meeting may be held as so adjourned without further
notice.



Section 10.6 Voting



The vote upon any resolution submitted to any meeting of Noteholders shall be by written
ballot on which shall be subscribed the signatures of the holders of Notes or of their
representatives by proxy and the principal amount of the Notes held or represented by them. The
permanent chairman of the meeting shall appoint two inspectors of votes who shall count all votes
cast at the meeting for or against any resolution and who shall make and file with the secretary of
the meeting their verified written reports in duplicate of all votes cast at the meeting. A record
in duplicate of the proceedings of each meeting of Noteholders shall be prepared by the secretary
of the meeting and there shall be attached to said record the original reports of the inspectors of
votes on any vote by ballot taken thereat and affidavits by one or more persons having knowledge of
the facts setting forth a copy of the notice of the meeting and showing that said notice was sent
as provided in Section 10.2. The record shall show the principal amount of the Notes voting in
favor of or against any resolution. The record shall be signed and verified by the affidavits of
the permanent chairman and secretary of the meeting and one of the duplicates shall be delivered to
the Company and the other to the Trustee to be preserved by the Trustee, the latter to have
attached thereto the ballots voted at the meeting.



Any record so signed and verified shall be conclusive evidence of the matters therein stated.



Section 10.7 No Delay of Rights by Meeting



Nothing contained in this Article X shall be deemed or construed to authorize or permit, by
reason of any call of a meeting of Noteholders or any rights expressly or implicitly conferred
hereunder to make such call, any hindrance or delay in the exercise of any right or rights
conferred upon or reserved to the Trustee or to the Noteholders under any of the provisions of this
Indenture or of the Notes.



ARTICLE XI




AMENDMENTS; SUPPLEMENTAL INDENTURES




Section 11.1 Amendments; Supplemental Indentures without Consent of Noteholders



The Company, when authorized by the resolutions of the Board of Directors, and the Trustee may
from time to time and at any time amend or supplement this Indenture or the Notes without notice to
or the consent of any Holder for one or more of the following purposes:




(a) to make provision with respect to the conversion rights of the holders of Notes
pursuant to the requirements of Section 15.6;




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




(c) to evidence the succession of another corporation, limited liability company,
partnership or trust to the Company, or successive successions, and the assumption by the
successor corporation, limited liability company, partnership or trust of the covenants,
agreements and obligations of the Company pursuant to Article XII;




(d) to add to the covenants of the Company such further covenants, restrictions or
conditions as the Company shall consider to be for the benefit of the holders of Notes,
including without limitation any reduction of the Conversion Price, and to make the
occurrence, or the occurrence and continuance, of a default in any such additional
covenants, restrictions or conditions a default or an Event of Default permitting the
enforcement of all or any of the several remedies provided in this Indenture as herein set
forth; provided, however, that in respect of any such additional covenant,
restriction or condition such supplemental indenture may provide for a particular period of
grace after default (which period may be shorter or longer than that allowed in the case of
other defaults) or may provide for an immediate enforcement upon such default or may limit
the remedies available to the Trustee upon such default;




(e) to provide for the issuance under this Indenture of Notes in coupon form (including
Notes registrable as to principal only) and to provide for exchangeability of such Notes
with the Notes issued hereunder in fully registered form and to make all appropriate changes
for such purpose;




(f) to cure any ambiguity or defect or to correct or supplement any provision contained
herein or in any supplemental indenture which may be defective or inconsistent with any
other provision contained herein or in any supplemental indenture, or to make such other
provisions in regard to matters or questions arising under this Indenture which shall not
adversely affect the interests of the holders of the Notes;




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




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



The Trustee is hereby authorized and directed to join with the Company in the execution of any
such supplemental indenture, to make any further appropriate agreements and stipulations which may
be therein contained and to accept the conveyance, transfer and assignment of any property
thereunder; provided, however, the Trustee shall not be obligated to but may, in
its discretion, enter into any supplemental indenture that affects the Trustee’s own rights, duties
or immunities under this Indenture or otherwise.



Any amendment or supplemental indenture authorized by the provisions of this Section 11.1 may
be executed by the Company and the Trustee without the consent of the holders of any of the Notes
at the time outstanding, notwithstanding any of the provisions of Section 11.2.



Section 11.2 Amendments; Supplemental Indentures with Consent of Noteholders



With the consent (evidenced as provided in Article IX) of the holders of not less than 66 2/3%
in aggregate principal amount of the Notes at the time outstanding (determined in accordance with
Section 9.4), the Company, when authorized by the resolutions of the Board of Directors, and the
Trustee may from time to time and at any time amend or supplement, the Notes or this Indenture for
the purpose of adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or any supplemental indenture or of modifying in any manner the rights
of the holders of the Notes; provided, however, that no such amendment or
supplemental indenture shall (i) extend the fixed maturity of any Note, or reduce the rate or
extend the time of payment of interest thereon, or reduce the principal amount thereof or premium,
if any, thereon, or reduce any amount payable on redemption or repurchase thereof, impair, or
change in any respect adverse to the holder of Notes, the obligation of the Company to repurchase
any Note at the option of the holder upon the happening of a Repurchase Event or any Repurchase
Date, or impair or adversely affect the right of any Noteholder to institute suit for the payment
thereof, or change the currency in which the Notes are payable, or impair or change in any respect
adverse to the Noteholders the right to convert the Notes into Common Stock subject to the terms
set forth herein, including Section 15.6, or subordinate the Notes in right of payment to other
indebtedness, in each such case without the consent of the holder of each Note so affected, or
(ii) reduce the aforesaid percentage of Notes, the holders of which are required to consent to any
such supplemental indenture, or modify this paragraph, without the consent of the holders of all
Notes then outstanding (determined in accordance with Section 9.4); provided,
further, however, that any amendment or supplemental indenture that
disproportionately affects the rights of a Noteholder or a class of Noteholder shall require the
prior consent of such Noteholder or the prior consent of Noteholders holding 66 2/3% of the
principal amount of Notes then held by such class, as applicable.



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



It shall not be necessary for the consent of the Noteholders under this Section 11.2 to
approve the particular form of any proposed amendment or supplemental indenture, but it shall be
sufficient if such consent shall approve the substance thereof.



Section 11.3 Effect of Amendments and Supplemental Indentures



Any amendment or supplemental indenture executed pursuant to the provisions of this Article XI
shall comply with the Trust Indenture Act, as then in effect; provided that this Section 11.3 shall
not require such amendment or supplemental indenture or the Trustee to be qualified under the Trust
Indenture Act prior to the time such qualification is in fact required under the terms of the Trust
Indenture Act or the Indenture has been qualified under the Trust Indenture Act, nor shall it
constitute any admission or acknowledgement by any party to such amendment or supplemental
indenture that any such qualification is required prior to the time such qualification is in fact
required under the terms of the Trust Indenture Act or the Indenture has been qualified under the
Trust Indenture Act. Upon the execution of any amendment or supplemental indenture pursuant to the
provisions of this Article XI, this Indenture shall be and be deemed to be modified and amended in
accordance therewith and the respective rights, limitation of rights, obligations, duties and
immunities under this Indenture of the Trustee, the Company and the holders of Notes shall
thereafter be determined, exercised and enforced hereunder subject in all respects to such
modifications and amendments and all the terms and conditions of any such supplemental indenture
shall be and be deemed to be part of the terms and conditions of this Indenture for any and all
purposes.



Section 11.4 Notation on Notes



Notes authenticated and delivered after the execution of any amendment or supplemental
indenture pursuant to the provisions of this Article XI may bear a notation in form approved by the
Trustee as to any matter provided for in such amendment or supplemental indenture. If the Company
or the Trustee shall so determine, new Notes so modified as to conform, in the opinion of the
Trustee and the Company, to any modification of this Indenture contained in any such amendment or
supplemental indenture may, at the Company’s expense, be prepared and executed by the Company,
authenticated by the Trustee (or an authenticating agent duly appointed by the Trustee pursuant to
Section 17.10) and delivered in exchange for the Notes then outstanding, upon surrender of such
Notes then outstanding.



Section 11.5 Evidence of Compliance of Amendment or Supplemental Indenture to be Furnished
to Trustee



The Trustee, subject to the provisions of Sections 8.1 and 8.2, shall be entitled to receive
an Officer’s Certificate and an Opinion of Counsel as conclusive evidence that any amendment or
supplemental indenture executed pursuant hereto complies with the requirements of this Article XI.



ARTICLE XII




CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE




Section 12.1 Company May Consolidate, Etc. 



The Company shall not, directly or indirectly, consolidate with or merge with or into any
other Person or sell, lease, convey or transfer all or substantially all its assets, whether in a
single transaction or a series of related transactions, to any Person or group of affiliated
Persons (other than a wholly-owned subsidiary of the Company) unless:




(a) either (i) in the case of a merger or consolidation that does not involve a
transfer of all or substantially all of the Company’s properties and assets, the Company is
the surviving entity or (ii) in case the Company shall consolidate with or merge into
another Person or sell, lease, convey or transfer all or substantially all of its properties
and assets, whether in a single transaction or a series of related transactions, to any
Person, the Person formed by such consolidation or into which the Company is merged (if
other than the Company), or the Person which acquires by sale, conveyance or transfer, or
which leases the properties and assets of the Company substantially as an entirety, shall be
a corporation, limited liability company, partnership, trust or other business entity, shall
be organized and validly existing under the laws of the United States of America, any state
thereof or the District of Columbia and shall expressly assume, by an indenture supplemental
hereto, executed and delivered to the Trustee, in form satisfactory to the Trustee, the due
and punctual payment of the principal of, premium, if any, and interest (including
Liquidated Damages, if any) on all of the Notes as applicable, and the performance or
observance of every covenant of this Indenture on the part of the Company to be performed or
observed and shall have provided for the applicable conversion rights set forth in
Section 15.6 and the repurchase rights set forth in Article XVI;




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




(c) the Company has delivered to the Trustee an Officer’s Certificate and an Opinion of
Counsel, each stating that such consolidation, merger, conveyance, transfer or lease and, if
a supplemental indenture is required in connection with such transaction, such supplemental
indenture complies with this Article XII and that all conditions precedent herein provided
for relating to such transaction have been complied with, together with any documents
required under Article IX.



Section 12.2 Successor Entity to be Substituted



In case of any such consolidation, merger, sale, conveyance or lease in accordance with
Section 12.1, and, where required in accordance with Section 12.1(a) upon the assumption by the
successor entity, by supplemental indenture, executed and delivered to the Trustee and satisfactory
in form to the Trustee, of the due and punctual payment of the principal of and premium, if any,
and interest (including Liquidated Damages, if any) on all of the Notes and the punctual
performance of all of the covenants of this Indenture to be performed by the Company, such
successor entity shall succeed to and be substituted for the Company, with the same effect as if it
had been named herein as the party of the first part. Such successor entity thereupon may cause to
be signed, and may issue either in its own name or in the name of Sipex Corporation any or all of
the Notes issuable hereunder which theretofore shall not have been signed by the Company and
delivered to the Trustee; and, upon the order of such successor entity instead of the Company and
subject to all the terms, conditions and limitations in this Indenture prescribed, the Trustee
shall authenticate and shall deliver, or cause to be authenticated and delivered, any Notes which
previously shall have been signed and delivered by the officers of the Company to the Trustee for
authentication, and any Notes which such successor entity thereafter shall cause to be signed and
delivered to the Trustee for that purpose. All the Notes so issued shall in all respects have the
same legal rank and benefit under this Indenture as the Notes theretofore or thereafter issued in
accordance with the terms of this Indenture. In the event of any such consolidation, merger, sale,
conveyance or lease, the Person named as the “Company” in the first paragraph of this Indenture or
any successor which shall thereafter have become such in the manner prescribed in this Article XII
may be dissolved, wound up and liquidated at any time thereafter and such Person shall be released
from its liabilities as obligor and maker of the Notes and from its obligations under this
Indenture.



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



Section 12.3 Opinion of Counsel to be Given Trustee



The Trustee, subject to Sections 8.1 and 8.2, shall receive an Officer’s Certificate and an
Opinion of Counsel as conclusive evidence that any such consolidation, merger, sale, conveyance or
lease and any such assumption complies with the provisions of this Article XII.



ARTICLE XIII




SATISFACTION AND DISCHARGE OF INDENTURE




Section 13.1 Discharge of Indenture



When (a) the Company shall deliver to the Trustee for cancellation all Notes theretofore
authenticated (other than any Notes that have been destroyed, lost or stolen and in lieu of or in
substitution for which other Notes shall have been authenticated and delivered) and not theretofore
canceled, or (b) all the Notes not theretofore canceled or delivered to the Trustee for
cancellation shall have become due and payable, and the Company shall deposit with the Trustee, in
trust, funds sufficient to pay at maturity of all of the Notes (other than any Notes which shall
have been mutilated, destroyed, lost or stolen and in lieu of or in substitution for which other
Notes shall have been authenticated and delivered) not theretofore canceled or delivered to the
Trustee for cancellation, including principal and premium, if any, and interest (including Default
Interest and Liquidated Damages, if any) due, and if in either case the Company shall also pay or
cause to be paid all other sums payable hereunder by the Company, then this Indenture shall cease
to be of further effect, and the Trustee, on demand of the Company accompanied by an Officers’
Certificate and an Opinion of Counsel if required by the Trustee pursuant to Section 17.5 and at
the cost and expense of the Company, shall execute proper instruments acknowledging satisfaction of
and discharging this Indenture. Notwithstanding the satisfaction and discharge of this Indenture,
the Company’s obligations to the Trustee under Section 8.6 and, if money shall have been deposited
with the Trustee, the following shall survive until the Notes have been paid in full: (i) the
remaining rights of registration of transfer, substitution and exchange and conversion of Notes,
(ii) the rights hereunder of Noteholders to receive payments of principal of and premium, if any,
and interest on, the Notes and the other rights, duties and obligations of Noteholders, as
beneficiaries hereof with respect to the amounts, if any, so deposited with the Trustee and (iii)
the rights, obligations and immunities of the Trustee hereunder (other than the rights of the
Trustee under Section 8.6, which shall survive as provided above).



Section 13.2 Deposited Monies to be Held in Trust by Trustee



Subject to Section 13.4, all monies deposited with the Trustee pursuant to Section 13.1 shall
be held in trust and applied by it to the payment, either directly or through any paying agent
(including the Company if acting as its own paying agent), to the holders of the particular Notes
for the payment or redemption of which such monies have been deposited with the Trustee, of all
sums due and to become due thereon for principal and interest and premium, if any.



Section 13.3 Paying Agent to Repay Monies Held



Upon the satisfaction and discharge of this Indenture, all monies then held by any paying
agent of the Notes (other than the Trustee) shall, upon demand of the Company, be repaid to it or
paid to the Trustee, and thereupon such paying agent shall be released from all further liability
with respect to such monies.



Section 13.4 Return of Unclaimed Monies



Subject to the requirements of applicable law, any monies deposited with or paid to the
Trustee or any paying agent of the Notes for payment of the principal of, premium, if any, or
interest (including Liquidated Damages, if any) on Notes and not applied but remaining unclaimed by
the holders of Notes for two (2) years after the date upon which the principal of, premium, if any,
or interest (including Liquidated Damages, if any) on such Notes, as the case may be, shall have
become due and payable, shall be repaid to the Company by the Trustee or paying agent on written
demand and all liability of the Trustee or paying agent shall thereupon cease with respect to such
monies; and the holder of any of the Notes shall thereafter look only to the Company for any
payment which such holder may be entitled to collect unless an applicable abandoned property law
designates another Person.



Section 13.5 Reinstatement



If (i) the Trustee or the paying agent is unable to apply any money in accordance with
Section 13.2 by reason of any order or judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application and (ii) the holders of at least 66 2/3% in
principal amount of the then outstanding Notes so request by written notice to the Trustee, the
Company’s obligations under this Indenture and the Notes shall be revived and reinstated as though
no deposit had occurred pursuant to Section 13.1 until such time as the Trustee or the paying agent
is permitted to apply all such money in accordance with Section 13.2; provided,
however, that if the Company makes any payment of interest on or principal of any Note
following the reinstatement of its obligations, the Company shall be subrogated to the rights of
the holders of such Notes to receive such payment from the money held by the Trustee or paying
agent.



ARTICLE XIV




NO RECOURSE AGAINST OTHERS




Section 14.1 Indenture and Notes Solely Corporate Obligations



No direct or indirect partner, employee, incorporator, shareholder, director or officer, as
such, past, present or future of the Company or any successor Person or any Subsidiary or any of
the Company’s Affiliates, shall have any personal liability in respect of the obligations of the
Company under the Notes or this Indenture by reason of his, her or its status as such partner,
employee, incorporator, shareholder, director or officer. Each Noteholder by accepting a Note
waives and releases all such liability. Such waiver and release are part of the consideration for
the issuance of the Notes.



ARTICLE XV




CONVERSION OF NOTES




Section 15.1 Right to Convert



Subject to and upon compliance with the provisions of this Indenture, the holder of any Note
shall have the right, at the holder’s option, at any time following the date of original issuance
of the Notes and prior to the close of business on May 16, 2026 (except that, with respect to any
Note or portion of a Note that shall be called for redemption, such right shall terminate, except
as provided Section 3.4, at the close of business on the last Business Day prior to the date fixed
for redemption of such Note or portion of a Note unless the Company shall default in payment due
upon redemption thereof), to convert the principal amount of any such Note, or any portion of such
principal amount which is One Thousand United States Dollars ($1,000) or an integral multiple
thereof, into that number of fully paid and non-assessable shares of Common Stock (as such shares
shall then be constituted) obtained by dividing the principal amount of the Note or portion thereof
surrendered for conversion by the Conversion Price in effect at such time, by surrender of the Note
so to be converted in whole or in part in the manner provided in Section 15.2. A holder of Notes
is not entitled to any rights of a holder of Common Stock until such holder has converted his Notes
to Common Stock, and only to the extent such Notes are deemed to have been converted to Common
Stock under this Article XV. A Note with respect to which a holder has delivered a notice in
accordance with Section 16.2 regarding such holder’s election to require the Company to repurchase
such holder’s Notes may be converted in accordance with this Article XV only if such holder
withdraws such repurchase notice by delivering a written notice of withdrawal to the Company prior
to the close of business on the last Business Day prior to the day fixed for repurchase.



Section 15.2 Exercise of Conversion Privilege; Issuance of Common Stock on Conversion



In order to exercise the conversion privilege with respect to any Definitive Note, the holder
of such Definitive Note then registered on the books of the Company shall (i) deliver a written
notice, in the form of the conversion notice attached hereto as Exhibit B, or a facsimile
thereof (the “Conversion Notice”), to the Trustee, the Company (with a copy to the Company’s legal
counsel) and the transfer agent at Computershare Investor Services, 250 Royall Street, Canton, MA
02021, telephone (781) 575-3390, facsimile (781) 575-2549, Attention: Novette Lee, of such holder’s
election to convert, which notice shall specify that all of such Note shall be converted or the
portion thereof to be converted (which shall be One Thousand United States Dollars ($1,000) or an
integral multiple thereof) and the name or names (with address) in which the shares of Common Stock
which shall be issuable on such conversion shall be issued, (ii) if such Note or portion thereof is
surrendered for conversion during the period from the close of business on the record date for any
Interest Payment Date through the close of business on the Business Day next preceding such
Interest Payment Date, pay by wire transfer of immediately available funds or other method
acceptable to the Company, an amount equal to the interest otherwise payable on such Interest
Payment Date on the principal amount being converted (unless such Note or portion thereof being
converted shall have been called for redemption pursuant to a redemption notice sent to the
Noteholders in accordance with Section 3.2 or shall have become due prior to such Interest Payment
Date as a result of exercise of the repurchase right set forth in Article XVI); provided,
however, that no such payment need be made if there shall exist at the time of conversion a
default in the payment of interest on the Notes (except that if a special record date for payment
of such defaulted interest has been set as provided in Section 2.3 and the Note or portion thereof
is surrendered for conversion during the period from the close of business on such special record
date through the close of business on the Business Day next preceding the special interest payment
date then the holder shall pay an amount equal to that portion, if any, of the interest payable on
such special interest payment date that does not relate to past due interest), (iii) pay by wire
transfer of immediately available funds or other method acceptable to the Company the transfer
taxes, if any, required pursuant to Section 15.8, and (iv) surrender the Definitive Note to be
converted in whole or in part to a common carrier for overnight delivery to the Company as soon as
practicable following such date (or an indemnification undertaking or other form of security
reasonably satisfactory to the Company with respect to the Definitive Note in the case of its loss,
theft or destruction). Anything herein to the contrary notwithstanding, in the case of Global
Securities, conversion notices may be delivered and a Participant’s interest in a Global Note may
be surrendered for conversion in accordance with the Applicable Procedures as in effect from time
to time. Each Note surrendered for conversion shall, unless the shares issuable on conversion are
to be issued in the same name as the registration of such Note, be duly endorsed by, or be
accompanied by instruments of transfer (including a broker’s letter regarding compliance with the
prospectus delivery requirement, if applicable) in form satisfactory to the Company duly executed
by, the holder or his duly authorized attorney.



The Company shall use its best efforts to, within three (3) Business Days after receipt of the
Conversion Notice from a Holder with respect to any Note, subject to compliance with any
restrictions on transfer if shares issuable on conversion are to be issued in a name other than
that of the Noteholder (as if such transfer were a transfer of the Note or Notes (or portion
thereof) so converted) (a)(i) in the case of shares of the Common Stock issuable upon such
conversion that will not, following issuance, be Restricted Securities, at the holder’s request,
credit such aggregate number of shares of Common Stock to which the holder shall be entitled to the
holder’s or its designee’s balance account with The Depository Trust Company through its
Deposit/Withdrawal At Custodian system or (ii) issue and deliver to the address as specified in the
Conversion Notice, a certificate, registered in the name of the holder or its designee, for the
number of full shares of Common Stock to which the holder shall be entitled upon such conversion,
and (b) deliver to such holder a check or cash in respect of any fractional interest in respect of
a share of Common Stock arising upon such conversion, as provided in Section 15.4 (which payment,
if any, shall be paid no later than five (5) Business Days after the Conversion Date). In case any
Note of a denomination greater than One Thousand United States Dollars ($1,000) shall be
surrendered for partial conversion, and subject to Section 2.3, the Company shall execute and the
Trustee shall authenticate and deliver to the holder of the Note so surrendered, without charge to
such holder, a new Note or Notes in authorized denominations in an aggregate principal amount equal
to the unconverted portion of the surrendered Note.



If a holder has elected to be governed by Section 2(k)(A) of the Securities Purchase
Agreement, such holder shall have not the right to convert any portion of any Note, to the extent
that after giving effect to such conversion, such holder would beneficially own in excess of 9.99%
of the number of shares of Common Stock outstanding immediately after giving effect to such
conversion (the “Conversion Limitation”). For purposes of the foregoing sentence, the number of
shares of Common Stock beneficially owned by such holder shall include the number of shares of
Common Stock issuable upon conversion of a Note with respect to which the determination of such
sentence is being made, but shall exclude the number of shares of Common Stock which would be
issuable upon (A) conversion of the remaining, nonconverted portion of any Note beneficially owned
by such holder and (B) exercise or conversion of the unexercised or nonconverted portion of any
other securities of the Company subject to a limitation on conversion or exercise analogous to the
limitation contained herein beneficially owned by such holder. Except as set forth in the
preceding sentence, for purposes of this Section, beneficial ownership shall be calculated in
accordance with Section 13(d) of the Exchange Act. For purposes of this Section 15.2, in
determining the number of outstanding shares of Common Stock, such holder may rely on the number of
outstanding shares of Common Stock as reflected in (x) the Company’s most recent annual, quarterly
or current report on Form 10-K, 10-Q or Form 8-K, respectively, as the case may be; (y) a more
recent public announcement by the Company or (z) any other notice by the Company setting forth the
number of shares of Common Stock outstanding. In any case, the number of outstanding shares of
Common Stock shall be determined after giving effect to the conversion or exercise of securities of
the Company, including any Note, by such holder since the date as of which such number of
outstanding shares of Common Stock was reported. By written notice to the Trustee and the Company,
any holder may increase or decrease the Conversion Limitation to any other percentage not in excess
of 9.99% specified in such notice; provided that (i) any such increase will not be effective until
the 61st day after such notice is delivered to the Trustee and the Company, and (ii) any such
increase or decrease will apply only to the holder sending such notice and not to any other holder
of Note. Notwithstanding the foregoing, the Conversion Limitation shall not be applicable (I) on
any of the ten Trading Days up to and including the maturity date or (II) during the Repurchase
Period.



If a holder has elected to be governed by Section 2(k)(B) of the Securities Purchase
Agreement, such holder shall have not the right to convert any portion of any Note, to the extent
that after giving effect to such conversion, such holder would beneficially own in excess of 4.99%
of the number of shares of Common Stock outstanding immediately after giving effect to such
conversion (the “Conversion Limitation”). For purposes of the foregoing sentence, the number of
shares of Common Stock beneficially owned by such holder shall include the number of shares of
Common Stock issuable upon conversion of a Note with respect to which the determination of such
sentence is being made, but shall exclude the number of shares of Common Stock which would be
issuable upon (A) conversion of the remaining, nonconverted portion of any Note beneficially owned
by such holder and (B) exercise or conversion of the unexercised or nonconverted portion of any
other securities of the Company subject to a limitation on conversion or exercise analogous to the
limitation contained herein beneficially owned by such holder. Except as set forth in the
preceding sentence, for purposes of this Section, beneficial ownership shall be calculated in
accordance with Section 13(d) of the Exchange Act. For purposes of this Section 15.2, in
determining the number of outstanding shares of Common Stock, such holder may rely on the number of
outstanding shares of Common Stock as reflected in (x) the Company’s most recent annual, quarterly
or current report on Form 10-K, 10-Q or Form 8-K, respectively, as the case may be; (y) a more
recent public announcement by the Company or (z) any other notice by the Company setting forth the
number of shares of Common Stock outstanding. In any case, the number of outstanding shares of
Common Stock shall be determined after giving effect to the conversion or exercise of securities of
the Company, including any Note, by such holder since the date as of which such number of
outstanding shares of Common Stock was reported. By written notice to the Trustee and the Company,
any holder may increase or decrease the Conversion Limitation to any other percentage not in excess
of 4.99% specified in such notice; provided that (i) any such increase will not be effective until
the 61st day after such notice is delivered to the Trustee and the Company, and (ii) any such
increase or decrease will apply only to the holder sending such notice and not to any other holder
of Note. Notwithstanding the foregoing, the Conversion Limitation shall not be applicable (I) on
any of the ten Trading Days up to and including the maturity date or (II) during the Repurchase
Period.



If the Company shall not have delivered the number of shares of Common Stock issued upon
conversion of Notes by any holder within three (3) Business Days after the Conversion Date with
respect to such Notes, the Company shall pay liquidated damages (“Share Delivery Damages”) to such
holder at the rate of one-half percent (0.5%) per month of the outstanding principal amount of
Notes so converted by such holder.



The conversion shall be deemed to have been effected as to any such Note (or portion thereof)
on the date on which the requirements set forth above in this Section 15.2 have been satisfied as
to such Note (or portion thereof) (such date, the “Conversion Date”), and the Person in whose name
any shares of Common Stock shall be issuable upon such conversion shall be deemed to have become on
the Conversion Date the holder of record of the shares represented thereby; provided,
however, that any such surrender on any date when the stock transfer books of the Company
shall be closed shall constitute the Person in whose name the certificates are to be issued as the
record holder thereof for all purposes on the next succeeding day on which such stock transfer
books are open, but such conversion shall be at the Conversion Price in effect on the date upon
which such Note shall be surrendered. For purposes of determining satisfaction of the requirement
set forth above with respect to the Conversion Date for any Note, any facsimile required to be sent
shall be deemed to have been sent on a given day if such facsimile was received before 1:00 p.m.,
New York City time, on such date, to the number listed above (unless a different number is
specified in a notice filed with the Trustee and sent by the Trustee, at the Company’s expense, to
each holder of the Notes at such holder’s address appearing in the Note Register, as provided for
in Section 2.5 of this Indenture) and a confirmation of transmission of such facsimile is obtained.



The Company shall pay in cash, on any Note or portion thereof surrendered for conversion
during the period from the close of business on any Interest Payment Date to which interest has
been fully paid through the close of business on the Business Day preceding the record date for the
next such Interest Payment Date, accrued and unpaid interest, if any, on the Note or portion
thereof surrendered for conversion to, but excluding, the date of conversion, and Liquidated
Damages, if any. Any such payment of interest shall be made with respect to such Note within ten
(10) Business Days after the Conversion Date. Notwithstanding the foregoing, any Note or portion
thereof surrendered for conversion during the period from the close of business on the record date
for any Interest Payment Date through the close of business on the Business Day next preceding such
Interest Payment Date shall (unless such Note or portion thereof being converted shall have been
called for redemption pursuant to a redemption notice sent to the Noteholders in accordance with
Section 3.2 or shall have become due prior to such Interest Payment Date as a result of exercise of
the repurchase right set forth in Article XVI) be accompanied by payment, in immediately available
funds or other funds acceptable to the Company, of an amount equal to the interest otherwise
payable on such Interest Payment Date on the principal amount being converted; provided,
however, that no such payment need be made if there shall exist at the time of conversion a
default in the payment of interest on the Notes. Nothing in this Section 15.2 shall affect the
right of a holder in whose name any Note is registered at the close of business on a record date to
receive the interest payable on such Note on the related Interest Payment Date in accordance with
the terms of this Indenture and the Note. Except as provided in this Section 15.2, no adjustment
shall be made for interest accrued on any Note converted or for dividends on any shares issued upon
the conversion of such Note as provided in this Article. Except where a Note (or portion thereof)
is surrendered for conversion on or after the day immediately following a record date or special
record date and prior to the related Interest Payment Date or special interest payment date, in
which case interest shall be paid as provided in Section 2.3 to the holder of record at the close
of business on such record date or special record date, accrued and unpaid interest on a Note (or
portion thereof) surrendered for conversion will be deemed paid by delivery of the shares of Common
Stock issuable on conversion.



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



Section 15.3 Company Right to Force Automatic Conversion



The Company may, at its option, automatically convert all or a portion of the Notes
(an “Automatic Conversion”) at any time prior to May 26, 2026 if (a) the Average Price (as defined
in Section 15.6(h)) per share of the Common Stock has exceeded One Hundred Fifty percent (150%) of
the Conversion Price then in effect for at least twenty (20) Trading Days within a period of thirty
(30) consecutive Trading Days ending within five (5) Trading Days of the Automatic Conversion
Notice (defined below) (the “Measurement Period”)specifying the date (the “Automatic Conversion
Date”) on which an Automatic Conversion will become effective is sent to all holders of Notes, (b)
the Average Daily Volume for the Common Stock shall be not less than Three Hundred Seventy Five
Thousand ($375,000) during such period, and (c) the Equity Conditions shall have been satisfied as
of the date of the Automatic Conversion Notice. Notwithstanding anything herein to the contrary,
if at any time prior to the Automatic Conversion Date the Equity Conditions are no longer
satisfied, the Company shall provide a notice to the Trustee and each holder of Notes of such
failure and, unless the Required Holders waive such failure, the Company shall be required to
withdraw the Automatic Conversion Notice.



Unless the Company shall have theretofore called for redemption all of the Notes then
outstanding, if the Company elects to convert all or a portion of the Notes pursuant to this
Section 15.3, the Company, or at its request (which must be received by the Trustee at least five
(5) Business Days prior to the date the Trustee is requested to give notice as described below
unless a shorter period is agreed to by the Trustee), the Trustee in the name of and at the expense
of the Company, shall send or cause to be sent a notice (the “Automatic Conversion Notice”) of the
Automatic Conversion not more than thirty (30) days but not less than five (5) days before the
Automatic Conversion Date to such holders at their last addresses as they shall appear upon the
Notes Register. Such notice shall be irrevocable. Any notice that is sent in the manner herein
provided shall be deemed given upon such holder of Notes actual receipt of the notice.



Each Automatic Conversion Notice shall state:




(a) The Automatic Conversion Date;




(b) the CUSIP number(s) of the Note(s) to be automatically converted;




(c) the place or places where such Notes are to be surrendered for conversion; and




(d) the Conversion Price then in effect.



In case the Notes are to be converted in part only, the Automatic Conversion Notice shall
state the portion of the principal amount thereof to be converted and shall state that on and after
the Automatic Conversion Date, upon surrender of such Note, a new Note or Notes in principal amount
equal to the unconverted portion thereof will be issued.



If any of the foregoing provisions or other provisions of this Section are inconsistent with
applicable law, such law shall govern.



In the event of an Automatic Conversion, the Company shall issue and deliver a certificate or
certificates for the number of full shares of Common Stock issuable upon conversion of the Notes
or, at the holder’s request, credit such aggregate number of shares of Common Stock to which the
holder shall be entitled to the holder’s balance account with the Depositary through its Deposit
Withdrawal At Custodian system, along with any cash in respect of any fractional shares of Common
Stock otherwise issuable upon conversion (as provided in Section 15.4) for payment to the holder as
promptly after the Automatic Conversion Date as practicable in accordance with the provisions of
this Section 15.3.



During the period beginning on the Automatic Conversion Date and ending on the date Thirty
(30) days thereafter, the Company shall not publicly offer to sell any shares of Common Stock or
securities convertible into or exchangeable for Common Stock (other than the Common Stock and
shares issued pursuant to employee benefit plans, qualified stock option plans or other employee
compensation plans existing prior to such Automatic Conversion Date or pursuant to then outstanding
options, warrants or rights), or publicly offer to sell or grant options, rights or warrants with
respect to any shares of Common Stock or securities convertible into or exchangeable for Common
Stock (other than the grant of options pursuant to option plans existing prior to such Automatic
Conversion Date).



All Notes subject to the Automatic Conversion shall be delivered to the Company to be
canceled. Failure to deliver such Notes shall not affect their automatic cancellation.



Section 15.4 Cash Payments in Lieu of Fractional Shares



No fractional shares of Common Stock or scrip representing fractional shares shall be issued
upon conversion of Notes. If more than one Note shall be surrendered for conversion at one time by
the same holder, the number of full shares which shall be issuable upon conversion thereof shall be
computed on the basis of the aggregate principal amount of the Notes (or specified portions thereof
to the extent permitted hereby) so surrendered for conversion. If any fractional share of stock
otherwise would be issuable upon the conversion of any Note or Notes, the Company shall calculate
and pay a cash adjustment in lieu of such fractional share at the current market value thereof to
the holder of Notes. For purposes of this Section 15.4, the current market value of a share of
Common Stock shall be the Average Price (determined as provided in Section 15.6(h)) on the first
Trading Day immediately preceding the day on which the Notes (or specified portions thereof) are
deemed to have been converted.



Section 15.5 Conversion Price



The conversion price shall be as specified in the form of Note (herein called the “Conversion
Price”) attached as Exhibit A hereto, subject to adjustment as provided in this Article XV.



Section 15.6 Adjustment of Conversion Price



The Conversion Price shall be adjusted from time to time by the Company as follows:




(a) In case the Company shall hereafter pay a dividend or make a distribution to all
holders of the outstanding Common Stock in shares of Common Stock, the Conversion Price in
effect at the opening of business on the Business Day following the date fixed for the
determination of shareholders entitled to receive such dividend or other distribution shall
be reduced by multiplying such Conversion Price by a fraction of which (i) the numerator
shall be the number of shares of Common Stock outstanding at the close of business on the
Record Date (as defined in Section 15.6(h)) fixed for such determination and (ii) the
denominator shall be the sum of such number of shares and the total number of shares
constituting such dividend or other distribution, such reduction in the Conversion Price to
become effective immediately after the opening of business on the Business Day following the
Record Date. If any dividend or distribution of the type described in this Section 15.6(a)
is declared but not so paid or made, the Conversion Price shall again be adjusted to the
Conversion Price which would then be in effect if such dividend or distribution had not been
declared.




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




(c) In case the Company shall issue rights, options or warrants to all or substantially
all holders of its outstanding shares of Common Stock entitling them to subscribe for or
purchase shares of Common Stock at a price per share less than the Current Market Price (as
defined in Section 15.6(h)) on the Record Date fixed for the determination of shareholders
entitled to receive such rights or warrants, the Conversion Price shall be adjusted so that
the same shall equal the price determined by multiplying the Conversion Price in effect at
the opening of business on the date after such Record Date by a fraction of which (i) the
numerator shall be the sum of the number of shares of Common Stock outstanding at the close
of business on the Record Date plus the number of shares that the aggregate offering price
of the total number of shares so offered for subscription or purchase would purchase at such
Current Market Price, and of which (ii) the denominator shall be the sum of the number of
 shares of Common Stock outstanding at the close of business on the Record Date plus the
total number of additional shares of Common Stock so offered for subscription or purchase.
Such adjustment shall be successively made whenever any such rights, options or warrants are
issued and shall become effective immediately after the opening of business on the Business
Day following the Record Date fixed for determination of shareholders entitled to receive
such rights, options or warrants. To the extent that shares of Common Stock are not
delivered pursuant to such rights, options or warrants, upon the expiration or termination
of such rights or warrants the Conversion Price shall be readjusted to the Conversion Price
that would then be in effect had the adjustments made upon the issuance of such rights,
options or warrants been made on the basis of delivery of only the number of shares of
Common Stock actually delivered. In the event that such rights, options or warrants are not
so issued, the Conversion Price shall again be adjusted to be the Conversion Price that
would then be in effect if the Record Date for the determination of shareholders entitled to
receive such rights, options or warrants had not been fixed. In determining whether any
rights, options or warrants entitle the holders to subscribe for or purchase shares of
Common Stock at less than such Current Market Price, and in determining the aggregate
offering price of such shares of Common Stock, there shall be taken into account any
consideration received for such rights, options or warrants, the value of such
consideration, if other than cash, to be determined in good faith by the Board of Directors.




(d) In case the Company shall, by dividend or otherwise, distribute to all or
substantially all holders of its Common Stock shares of any class of capital stock of the
Company (other than any dividends or distributions to which Section 15.6(a) applies) or
evidences of its indebtedness or other assets (including securities, but excluding (1) any
rights, options or warrants referred to in Section 15.6(c) and (2) dividends and
distributions paid exclusively in cash, (the foregoing hereinafter in this Section 15.6(d)
called the “Additional Securities”)), unless the Company elects to reserve such Additional
Securities for distribution to the Noteholders upon conversion of the Notes so that any such
holder converting Notes will receive upon such conversion, in addition to the shares of
Common Stock to which such holder is entitled, the amount and kind of such Additional
Securities which such holder would have received if such holder had converted its Notes into
Common Stock immediately prior to the Record Date (as defined in Section 15.6(h)) for such
distribution of the Additional Securities then, in each such case, the Conversion Price
shall be reduced so that the same shall be equal to the price determined by multiplying the
Conversion Price in effect immediately prior to the close of business on the Record Date
with respect to such distribution by a fraction of which (i) the numerator shall be the
Current Market Price (determined as provided in Section 15.6(h)) on such date less the fair
market value (as determined in good faith by the Board of Directors, whose determination
shall be conclusive and described in a Board Resolution) on such date of the portion of the
Additional Securities so distributed applicable to one share of Common Stock and (ii) the
denominator shall be such Current Market Price, such reduction to become effective
immediately prior to the opening of business on the Business Day following the Record Date;
provided, however, that in the event the then fair market value (as so
determined) of the portion of the Additional Securities so distributed applicable to one
share of Common Stock is equal to or greater than the Current Market Price on the Record
Date, in lieu of the foregoing adjustment, adequate provision shall be made so that each
Noteholder shall have the right to receive upon conversion of a Note (or any portion
thereof) the amount of Common Stock, other capital stock, evidences of indebtedness and
other assets that such holder would have received had such holder converted such Note (or
portion thereof) immediately prior to such Record Date and immediately thereafter received
such cash distribution. In the event that such dividend or distribution is not so paid or
made, the Conversion Price shall again be adjusted to be the Conversion Price which would
then be in effect if such dividend or distribution had not been declared. If the Board of
Directors determines the fair market value of any distribution for purposes of this
Section 15.6(d) by reference to the actual or when issued trading market for any securities
comprising all or part of such distribution, it must in doing so consider the prices in such
market over the same period (the “Reference Period”) used in computing the Current Market
Price pursuant to Section 15.6(h) to the extent possible, unless the Board of Directors in a
Board Resolution determines in good faith that determining the fair market value during the
Reference Period would not be in the best interest of the Noteholders.




In the event that the Company implements a new shareholder rights plan, such rights
plan shall provide that upon conversion of the Notes the holders will receive, in addition
to the Common Stock issuable upon such conversion, the rights issued under such rights plan
as if the holders had converted the Notes prior to implementing the rights plan and
notwithstanding the occurrence of an event causing such rights to separate from the Common
Stock at or prior to the time of conversion. Any distribution of rights, options or
warrants pursuant to a shareholder rights plan complying with the requirements set forth in
the immediately preceding sentence of this paragraph shall not constitute a distribution of
rights, options or warrants for the purposes of Section 15.6(c) or this Section 15.6(d).




Rights, options or warrants distributed by the Company to all holders of Common Stock
entitling the holders thereof to subscribe for or purchase shares of the Company’s capital
stock (either initially or under certain circumstances), which rights, options or warrants,
until the occurrence of a specified event or events (“Trigger Event”): (i) are deemed to be
transferred with such shares of Common Stock; (ii) are not exercisable; and (iii) are also
issued in respect of future issuances of Common Stock, shall be deemed not to have been
distributed for purposes of this Section 15.6(d) (and no adjustment to the Conversion Price
under this Section 15.6(d) will be required) until the occurrence of the earliest Trigger
Event. If such right, option or warrant is subject to subsequent events, upon the
occurrence of which such right, option or warrant shall become exercisable to purchase
different securities, evidences of indebtedness or other assets or entitles the holder to
purchase a different number or amount of the foregoing or to purchase any of the foregoing
at a different purchase price, then the occurrence of each such event shall be deemed to be
the date of issuance and record date with respect to a new right, option or warrant (and a
termination or expiration of the existing right or warrant without exercise by the holder
thereof). In addition, in the event of any distribution (or deemed distribution) of rights,
options or warrants, or any Trigger Event or other event (of the type described in the
preceding sentence) with respect thereto, that resulted in an adjustment to the Conversion
Price under this Section 15.6(d), (1) in the case of any such rights, options or warrants
that shall all have been redeemed or repurchased without exercise by any holders thereof,
the Conversion Price shall be readjusted upon such final redemption or repurchase to give
effect to such distribution or Trigger Event, as the case may be, as though it were a cash
distribution, equal to the per share redemption or repurchase price received by a holder of
Common Stock with respect to such rights, options or warrants (assuming such holder had
retained such rights, options or warrants), made to all holders of Common Stock as of the
date of such redemption or repurchase, and (2) in the case of such rights, options or
warrants all of which shall have expired or been terminated without exercise, the Conversion
Price shall be readjusted as if such rights, options and warrants had never been issued.




For purposes of this Section 15.6(d) and Sections 15.6(a) and (c), any dividend or
distribution to which this Section 15.6(d) is applicable that also includes shares of Common
Stock, or rights, options or warrants to subscribe for or purchase shares of Common Stock to
which Section 15.6(a) or 15.6(c) applies (or both), shall be deemed instead to be (1) a
dividend or distribution of the evidences of indebtedness, assets, shares of capital stock,
rights, options or warrants other than such shares of Common Stock or rights or warrants to
which Section 15.6(c) applies (and any Conversion Price reduction required by this Section
15.6(d) with respect to such dividend or distribution shall then be made) immediately
followed by (2) a dividend or distribution of such shares of Common Stock or such rights,
options or warrants (and any further Conversion Price reduction required by Sections 15.6(a)
and (c) with respect to such dividend or distribution shall then be made, except (A) the
Record Date of such dividend or distribution shall be substituted as “the date fixed for the
determination of shareholders entitled to receive such dividend or other distribution”,
“Record Date fixed for such determination” and “Record Date” within the meaning of
Section 15.6(a) and as “the date fixed for the determination of shareholders entitled to
receive such rights, options or warrants”, “the Record Date fixed for the determination of
the shareholders entitled to receive such rights, options or warrants” and “such Record
Date” within the meaning of Section 15.6(c) and (B) any shares of Common Stock included in
such dividend or distribution shall not be deemed “outstanding at the close of business on
the date fixed for such determination” within the meaning of Section 15.6(a).




(e) In case the Company shall, by dividend or otherwise, distribute to all holders of
its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation
to which Section 15.7 applies or as part of a distribution referred to in Section 15.6),
then immediately after the close of business on the Record Date for the distribution, the
Conversion Price shall be reduced so that the same shall equal the price determined by
multiplying the Conversion Price in effect immediately prior to the close of business on
such Record Date by a fraction (i) the numerator of which shall be equal to the Current
Market Price on the Record Date less the portion of the cash so distributed to one (1) share
of Common Stock and (ii) the denominator of which shall be equal to the Current Market Price
on such date; provided, however, that in the event the portion of the cash so distributed
applicable to one (1) share of Common Stock is equal to or greater than the Current Market
Price of the Common Stock on the Record Date, in lieu of the foregoing adjustment, adequate
provision shall be made so that each holder shall have the right to receive upon conversion
of a Note (or any portion thereof) the amount of cash such holder would have received had
such holder converted such Note (or portion thereof) immediately prior to such Record Date.
In the event that such dividend or distribution is not so paid or made, the Conversion Price
shall again be adjusted to be the Conversion Price that would then be in effect if such
dividend or distribution had not been declared.




(f) In case a tender offer made by the Company or any Subsidiary of the Company for all
or any portion of the Common Stock shall expire and such tender offer (as amended upon the
expiration thereof) shall require the payment to all or substantially all holders of its
Common Stock (based on the acceptance (up to any maximum specified in the terms of the
tender offer) of Purchased Shares (as defined below)) of consideration having a fair market
value (as determined by the Board of Directors of the Company, whose determination shall be
conclusive and described in a Board Resolution) that as of the last time (the “Expiration
Time”) tenders could have been made pursuant to such tender offer (as it may be amended)
exceeds the Current Market Price (determined as provided in Section 15.6(h)) on the Trading
Day next succeeding the Expiration Time, then, and in each such case, immediately prior to
the opening of business on the day after the date of the Expiration Time, the Conversion
Price shall be adjusted so that the same shall equal the price determined by multiplying the
Conversion Price in effect immediately prior to close of business on the date of the
Expiration Time by a fraction of which the numerator shall be the number of shares of Common
Stock outstanding (including any tendered shares) on the Expiration Time multiplied by the
Current Market Price of the Common Stock on the Trading Day next succeeding the Expiration
Time and the denominator shall be the sum of (x) the fair market value (determined as
aforesaid) of the aggregate consideration payable to stockholders based on the acceptance
(up to any maximum specified in the terms of the tender offer) of all shares validly
tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted, up to
any such maximum, being referred to as the “Purchased Shares”) and (y) the product of the
number of shares of Common Stock outstanding (less any Purchased Shares) on the Expiration
Time and the Current Market Price of the Common Stock on the Trading Day next succeeding the
Expiration Time, such reduction (if any) to become effective immediately prior to the
opening of business on the day following the Expiration Time. In the event that the Company
is obligated to purchase shares pursuant to any such tender offer, but the Company is
permanently prevented by applicable law from effecting any such purchases or all such
purchases are rescinded, the Conversion Price shall again be adjusted to be the Conversion
Price which would then be in effect if such tender offer had not been made. If the
application of this Section 15.6(f) to any tender offer would result in an increase in the
Conversion Price, no adjustment shall be made for such tender offer under this Section
15.6(f).




(g) The Conversion Price shall be as specified in the form of Convertible Senior Note
attached as Exhibit A hereto, subject to adjustment as provided in this Article XV.




(h) For purposes of this Section 15.6, the following terms shall have the meaning
indicated:




(1) “Average Price” with respect to any security on any day shall mean the
daily volume weighted average price of such security for all sales reported on such
day by the principal national security exchange or quotation system on which such
security is quoted or listed or admitted to trading or, if not quoted or listed or
admitted to trading on any national securities exchange or quotation system, as
reported by the National Quotation Bureau Incorporated, Pink Sheets LLC or a similar
generally accepted reporting service, or, in case no sales of such security take
place on such day, the Average Price for such security on such day shall be the
Closing Price.




(2) “Closing Price” with respect to any security on any day shall mean the
closing sale price regular way on such day or, in case no such sale takes place on
such day, the average of the reported closing bid and asked prices, regular way, in
each case on the Nasdaq National Market or New York Stock Exchange, as applicable,
or, if such security is not listed or admitted to trading on such National Market or
Exchange, on the principal national security exchange or quotation system on which
such security is quoted or listed or admitted to trading, or, if not quoted or
listed or admitted to trading on any national securities exchange or quotation
system, the average of the closing bid and asked prices of such security on the
over-the-counter market on the day in question as reported by the National Quotation
Bureau Incorporated, Pink Sheets LLC or a similar generally accepted reporting
service. If the Average Price cannot be calculated for a security on a particular
date on any of the foregoing bases, the Average Price of such security on such date
shall be the fair market value as mutually determined by the Company and the
Trustee. If the Company and the Trustee are unable to agree upon the fair market
value of such security, then such dispute shall be resolved pursuant to Section
17.12. All such determinations to be appropriately adjusted for any stock dividend,
stock split, stock combination or other similar transaction during the applicable
calculation period.




(3) “Current Market Price” shall mean the arithmetic average of the daily
Average Prices per share of Common Stock for the ten (10) consecutive Trading Days
immediately prior to the date in question; provided, however, that
(1) if the “ex” date (as hereinafter defined) for any event (other than the issuance
or distribution requiring such computation) that requires an adjustment to the
Conversion Price pursuant to Section 15.6(a), (b), (c) or (d) occurs during such ten
(10) consecutive Trading Days, the Average Price for each Trading Day prior to the
“ex” date for such other event shall be adjusted by multiplying such Average Price
by the same fraction by which the Conversion Price is so required to be adjusted as
a result of such other event, (2) if the “ex” date for any event (other than the
issuance or distribution requiring such computation) that requires an adjustment to
the Conversion Price pursuant to Section 15.6(a), (b), (c) or (d) occurs on or after
the “ex” date for the issuance or distribution requiring such computation and prior
to the day in question, the Average Price for each Trading Day on and after the “ex”
date for such other event shall be adjusted by multiplying such Average 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, and (3) if the “ex” date for the issuance
or distribution requiring such computation is prior to the day in question, after
taking into account any adjustment required pursuant to clause (1) or (2) of this
proviso, the Average Price for each Trading Day on or after such “ex” date shall be
adjusted by adding thereto the amount of any cash and the fair market value (as
determined in good faith by the Company’s Board of Directors in a manner consistent
with any determination of such value for purposes of Section 15.6(d), whose
determination shall be conclusive and described in a Board Resolution) of the
evidences of indebtedness, shares of capital stock or assets being distributed
applicable to one share of Common Stock as of the close of business on the day
before such “ex” date. For purposes of this paragraph, the term “ex” date, (1) when
used with respect to any issuance or distribution, means the first date on which the
Common Stock trades regular way on the relevant exchange or in the relevant market
from which the Average Price was obtained without the right to receive such issuance
or distribution and (2) when used with respect to any subdivision or combination of
 shares of Common Stock, means the first date on which the Common Stock trades
regular way on such exchange or in such market after the time at which such
subdivision or combination becomes effective. Notwithstanding the foregoing,
whenever successive adjustments to the Conversion Price are called for pursuant to
this Section 15.6, such adjustments shall be made to the Current Market Price as may
be necessary or appropriate to effectuate the intent of this Section 15.6 and to
avoid unjust or inequitable results as determined in good faith by the Board of
Directors.




(4) “fair market value” shall mean the amount which a willing buyer would pay a
willing seller in an arm’s length transaction.




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




(6) “Trading Day” shall mean (x) if the applicable security is listed or
admitted for trading on the New York Stock Exchange or another national security
exchange, a day on which the New York Stock Exchange or such other national security
exchange, as applicable, is open for business or (y) if the applicable security is
quoted on the Nasdaq National Market, a day on which trades may be made thereon or
(z) if the applicable security is not so listed, admitted for trading or quoted, a
Business Day.




(i) No adjustment in the Conversion Price shall be required under this Section 15.6
unless such adjustment would require an increase or decrease of at least one percent (1%) in
such price; provided, however, that any adjustments which by reason of this
Section 15.6(i) are not required to be made shall be carried forward and taken into account
in any subsequent adjustment. All calculations under this Article XV shall be made by the
Company and shall be made to the nearest cent or to the nearest one hundredth of a share, as
the case may be. No adjustment need be made for a change in the par value or no par value
of the Common Stock.




(j) Subject to Section 15.6(i), whenever the Conversion Price is adjusted as provided
in this Section 15.6, the Company shall promptly file with the Trustee and any conversion
agent other than the Trustee an Officer’s Certificate setting forth the Conversion Price
after such adjustment and setting forth a brief statement of the facts requiring such
adjustment. Promptly after delivery of such certificate, the Company shall prepare a notice
of such adjustment of the Conversion Price setting forth the adjusted Conversion Price and
the date on which each adjustment becomes effective and shall send such notice of such
adjustment of the Conversion Price to the holder of each Note at his last address appearing
on the Note Register provided for in Section 2.5, within twenty (20) days of the effective
date of such adjustment. Failure to deliver such notice shall not effect the legality or
validity of any such adjustment.




(k) In any case in which this Section 15.6 provides that an adjustment shall become
effective immediately after a Record Date for an event, the Company may defer until the
occurrence of such event (i) issuing to the holder of any Note converted after such Record
Date and before the occurrence of such event the additional shares of Common Stock issuable
upon such conversion by reason of the adjustment required by such event over and above the
Common Stock issuable upon such conversion before giving effect to such adjustment and
(ii) paying to such holder any amount in cash in lieu of any fraction pursuant to
Section 15.4.




(l) For purposes of this Section 15.6, the number of shares of Common Stock at any time
outstanding shall not include shares held in the treasury of the Company but shall include
 shares issuable in respect of scrip certificates issued in lieu of fractions of shares of
Common Stock. The Company will not pay any dividend or make any distribution on shares of
Common Stock held in the treasury of the Company.



Section 15.7 Effect of Reclassification, Consolidation, Merger or Sale



Subject to the provisions of Article XVI, if any of the following events occur, namely (i) any
reclassification or change of the outstanding shares of Common Stock (other than a change in par
value, or from par value to no par value, or from no par value to par value, or as a result of a
subdivision or combination), (ii) any consolidation, merger or combination of the Company with
another Person as a result of which holders of Common Stock shall be entitled to receive stock,
securities or other property or assets (including cash) with respect to or in exchange for such
Common Stock (other than as a result of a change in name, a change in par value or a change in the
jurisdiction of incorporation), (iii) any statutory exchange as a result of which holders of Common
Stock generally shall be entitled to receive stock, securities or other property or assets
(including cash) with respect to or in exchange for such Common Stock (such transaction, a
“Statutory Exchange”), or (iv) any sale or conveyance of the properties and assets of the Company
as, or substantially as, an entirety to any other Person as a result of which holders of Common
Stock shall be entitled to receive stock, securities or other property or assets (including cash)
with respect to or in exchange for such Common Stock, then the Company or the successor or
purchasing Person, as the case may be, shall execute with the Trustee a supplemental indenture
(which shall comply with the Trust Indenture Act as in force at the date of execution of such
supplemental indenture if such supplemental indenture is then required to so comply) providing that
such Note shall be convertible into the kind and amount of shares of stock and other securities or
property or assets (including cash) receivable upon such reclassification, change, consolidation,
merger, combination, Statutory Exchange, sale or conveyance by a holder of a number of shares of
Common Stock issuable upon conversion of such Notes (assuming, for such purposes, a sufficient
number of authorized shares of Common Stock available to convert all such Notes) immediately prior
to such reclassification, change, consolidation, merger, combination, Statutory Exchange, sale or
conveyance assuming such holder of Common Stock did not exercise his rights of election, if any,
that holders of Common Stock who were entitled to vote or consent to such transaction had as to the
kind or amount of securities, cash or other property receivable upon such consolidation, merger,
combination, Statutory Exchange, sale or conveyance (provided that, if the kind or amount of
securities, cash or other property receivable upon such consolidation, merger, combination,
Statutory Exchange, sale or conveyance is not the same for each share of Common Stock in respect of
which such rights of election shall not have been exercised (“non-electing share”), then for the
purposes of this Section 15.7 the kind and amount of securities, cash or other property receivable
upon such consolidation, merger, combination, Statutory Exchange, sale or conveyance for each
non-electing share shall be deemed to be the kind and amount so receivable per share by a plurality
of the non-electing shares). Such supplemental indenture shall provide for adjustments which shall
be as nearly equivalent as may be practicable to the adjustments provided for in this Article XV.
If, in the case of any such reclassification, change, consolidation, merger, combination, Statutory
Exchange, sale or conveyance, the stock or other securities and assets receivable thereupon by a
holder of shares of Common Stock include shares of stock or other securities and assets of a Person
other than the successor or purchasing Person, as the case may be, in such reclassification,
change, consolidation, merger, combination, Statutory Exchange, sale or conveyance, 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 Notes as the Company’s Board
of Directors shall reasonably consider necessary by reason of the foregoing, including to the
extent practicable the provisions providing for the repurchase rights set forth in Article XVI
herein.



The Company shall cause notice of the execution of such supplemental indenture to be sent to
each holder of Notes, at his address appearing on the Note Register provided for in Section 2.5 of
this Indenture, within twenty (20) days after execution thereof. Failure to deliver such notice
shall not affect the legality or validity of such supplemental indenture.



The above provisions of this Section 15.7 shall similarly apply to successive
reclassifications, changes, consolidations, mergers, combinations, sales and conveyances.



	 	 	 	 	 
	If this Section 15.7 applies to any event or occurrence, Section 15.6 shall not apply.
	Section 15.8	 	Taxes on Shares Issued






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



Section 15.9 Reservation of Shares; Shares to be Fully Paid; Listing of Common Stock



The Company shall provide, free from preemptive rights, out of its authorized but unissued
shares or shares held in treasury, reserved for the purpose of issuance, no less than one hundred
ten percent (110%) of the number of shares of Common Stock needed to provide for the issuance of
Common Stock upon conversion of all of the Notes or exercise of all of the Warrants without regard
to any limitations on conversions or exercise (but not including any Additional Shares).



The Company (i) will not increase the par value of any shares of Common Stock issuable upon
conversion of the Notes above the Conversion Price then in effect, (ii) will take all such actions
as may be necessary or appropriate in order that the Company may validly and legally issue fully
paid and non-assessable shares of Common Stock upon conversion of the Notes and (iii) will not take
any action which results in any adjustment of the Conversion Price if the total number of shares of
Common Stock issuable after the conversion of all of the Notes would exceed the total number of
shares of Common Stock then authorized by the Company’s articles of incorporation and available for
the purpose of issue upon such exercise.



The Company (i) will not increase the par value of any shares of Common Stock issuable upon
conversion of the Notes above the Conversion Price then in effect, (ii) will take all such actions
as may be necessary or appropriate in order that the Company may validly and legally issue fully
paid and non-assessable shares of Common Stock upon conversion of the Notes and (iii) will not take
any action which results in any adjustment of the Conversion Price if the total number of shares of
Common Stock issuable after the conversion of all of the Notes and the exercise of all of the
Warrants would exceed the total number of shares of Common Stock then authorized by the Company’s
articles of incorporation and available for the purpose of issue upon such exercise.



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



The Company is obligated to register the Notes and the shares of Common Stock issuable upon
conversion of the Notes for resale under the Securities Act pursuant to the Registration Rights
Agreement. The Notes and the shares of Common Stock issuable upon conversion of the Notes shall
constitute Registrable Securities (as such term is defined in the Registration Rights Agreement).
Each holder of Notes shall be entitled to all of the benefits afforded to a holder of Registrable
Securities under the Registration Rights Agreement and such holder, by its acceptance of a Note,
agrees and shall agree to be bound by and to comply with the terms and conditions of the
Registration Rights Agreement applicable to such holder as a holder of such Registrable Securities.



Upon the filing of a registration statement pursuant to the terms of the Registration Rights
Agreement, the Company shall use commercially reasonable efforts to promptly secure the listing of
the shares of Common Stock issuable upon conversion of a Note upon the Principal Market no later
than the Principal Market Listing Deadline and shall use its reasonable best efforts to maintain,
so long as any Notes remain outstanding, such listing on the Principal Market of all shares of
Common Stock from time to time issuable upon the conversion of all then outstanding Notes; and the
Company shall use its reasonable best efforts to list on the Principal Market and shall maintain
such listing of, any other shares of capital stock of the Company issuable upon conversion of the
Notes so long as any Notes remain outstanding. The Company shall pay all fees and expenses in
connection with satisfying its obligations under this Section 15.9.



Section 15.10 Responsibility of Trustee



The Trustee and any other conversion agent shall not at any time be under any duty or
responsibility to any holder of Notes to determine whether any facts exist which may require any
adjustment of the Conversion Price, or with respect to the nature or extent or calculation of any
such adjustment when made, or with respect to the method employed, or herein or in any supplemental
indenture provided to be employed, in making the same. The Trustee and any other conversion agent
shall not be accountable with respect to the validity or value (or the kind or amount) of any
shares of Common Stock, or of any securities or property, which may at any time be issued or
delivered upon the conversion of any Note; and the Trustee and any other conversion agent make no
representations with respect thereto. Subject to the provisions of Section 8.1, neither the
Trustee nor any conversion agent shall be responsible for any failure of the Company to issue,
transfer or deliver any shares of Common Stock or stock certificates or other securities or
property or cash upon the surrender of any Note for the purpose of conversion or to comply with any
of the duties, responsibilities or covenants of the Company contained in this Article XV.
Without limiting the generality of the foregoing, neither the Trustee nor any conversion agent
shall be under any responsibility to determine whether a supplemental indenture need be entered
into under Section 15.7 or the correctness of any provisions contained in any supplemental
indenture entered into pursuant to such section relating either to the kind or amount of shares of
stock or securities or property (including cash) receivable by Noteholders upon the conversion of
their Notes after any event referred to in such Section 15.7 or to any adjustment to be made with
respect thereto, but, subject to the provisions of Section 8.1, may accept as conclusive evidence
of the correctness of any such provisions, and shall be protected in relying upon, the Officer’s
Certificate (which the Company shall be obligated to file with the Trustee prior to the execution
of any such supplemental indenture) with respect thereto.



Section 15.11 Notice to Holders Prior to Certain Actions



In case:




(a) the Company shall declare a dividend (or any other distribution) on its Common
Stock; or




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




(c) of any reclassification of the Common Stock of the Company (other than a
subdivision or combination of its outstanding Common Stock, or a change in par value, or
from par value to no par value, or from no par value to par value), or of any consolidation
or merger to which the Company is a party and for which approval of any shareholders of the
Company is required (other than a merger that only serves to change the Company’s name or
jurisdiction of incorporation), or of the sale or transfer of all or substantially all of
the assets of the Company; or




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



the Company shall cause to be filed with the Trustee and to be sent to each holder of Notes at his
address appearing on the Note Register, provided for in Section 2.5 of this Indenture, as promptly
as possible but in any event at least fifteen (15) days prior to the applicable date hereinafter
specified, a notice stating (x) the date on which a record is to be taken for the purpose of such
dividend, distribution or granting of rights or warrants, or, if a record is not to be taken, the
date as of which the holders of Common Stock of record to be entitled to such dividend,
distribution or rights or warrants are to be determined, or (y) the date on which such
reclassification, consolidation, merger, sale, transfer, dissolution, liquidation or winding-up is
expected to become effective or occur, and the date as of which it is expected that holders of
Common Stock of record shall be entitled to exchange their Common Stock for securities or other
property deliverable upon such reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding-up. Failure to give such notice, or any defect therein, shall
not affect the legality or validity of such dividend, distribution, reclassification,
consolidation, merger, sale, transfer, dissolution, liquidation or winding-up.



Section 15.12 Holder Not Deemed a Shareholder



Except as otherwise specifically provided herein, prior to a Noteholder’s receipt of Common
Stock upon conversion of a Note, the Noteholder shall not be entitled, as such, to any rights of a
shareholder of the Company, including, without limitation, the right to vote or to consent to any
action of the shareholders of the Company, to receive dividends or other distributions, to exercise
any preemptive right or to receive dividends or other distributions, or to receive any notice of
meetings of shareholders of the Company, and shall not be entitled to receive any notice of any
proceedings of the Company. In addition, nothing contained in this Indenture shall be construed as
imposing any liabilities on such holder to purchase any securities (upon conversion of a Note or
otherwise) or as a shareholder of the Company, whether such liabilities are asserted by the Company
or by creditors of the Company.



ARTICLE XVI




REPURCHASE RIGHT




Section 16.1 Repurchase Right 




(a) If, at any time prior to May 16, 2026 there shall occur a Repurchase Event (as
defined in Section 16.3), then each holder shall have the right, at such holder’s option, to
require the Company to repurchase all of such holder’s Notes, or any portion thereof (in
principal amounts of One Thousand United States Dollars ($1,000) or integral multiples
thereof), on the date set by the Company (a “Repurchase Date”) that is no less than thirty
(30) and no more than forty (40) calendar days after the date of the Company Notice (as
defined in Section 16.2(a) below) delivered following the occurrence of such Repurchase
Event (or, if such 40th day is not a Business Day, the next succeeding Business Day). Such
repurchase shall be made in cash at a price equal to 100% of the principal amount of Notes
such holder elects to require the Company to repurchase together, in each case, with accrued
interest, if any, to, but excluding, the applicable Repurchase Date (the “Repurchase
Price”).




(b) In addition, Notes shall be purchased by the Company at the option of the holder on
May 15, 2011, May 15, 2016 and May 15, 2021 (each, also a “Repurchase Date”), at the
Repurchase Price.




(c) Notwithstanding anything in this Article XVI to the contrary, if a redemption date
pursuant to Article III shall occur prior to any Repurchase Date established pursuant to a
Company Notice under Section 16.2, provided that the Company shall have deposited or set
aside an amount of money sufficient to redeem such Notes as set forth in Section 3.2 on or
before such Repurchase Date, all such Notes shall be redeemed pursuant to Article III and
the repurchase rights hereunder shall have no effect.



Section 16.2 Notices; Method of Exercising Repurchase Right, Etc.




(a) Unless the Company shall have theretofore called for redemption all of the
outstanding Notes and deposited or set aside an amount of money sufficient to redeem such
Notes on the redemption date as set forth in Section 3.2, on or before (x) the tenth (10th)
calendar day following the occurrence of a Repurchase Event or (y) June 15, 2011, June 15,
2016, and June 15, 2021 (unless, in each case, a shorter time shall be satisfactory to the
Trustee), the Company or, at the written request of the Company, the Trustee, shall send to
all holders of record of the Notes a notice (the “Company Notice”) in the form as prepared
by the Company of the repurchase right set forth herein arising as of the result of the
occurrence of a Repurchase Event or on June 15, 2011, June 15, 2016, or June 15, 2021, as
applicable. The Company shall also deliver a copy of such notice to the Trustee. The
Company Notice shall contain the following information:




(1) a brief description of the Repurchase Event, if applicable;




(2) the Repurchase Date;




(3) the CUSIP number(s) of the Note(s) subject to the repurchase right;




(4) the date by which the repurchase right must be exercised;




(5) the last date by which the election to require repurchase, if submitted,
must be revoked;




(6) the Repurchase Price;




(7) a description of the procedure which a holder must follow to exercise a
repurchase right; and




(8) the Conversion Price then in effect, the date on which the right to convert
the principal amount of the Notes to be repurchased will terminate and the place or
places where Notes may be surrendered for conversion.



No failure of the Company to give the foregoing notices or defect therein shall limit any
holder’s right to exercise a repurchase right or affect the validity of the proceedings for the
repurchase of Notes.



If any of the foregoing provisions are inconsistent with applicable law, such law shall
govern.




(b) To exercise a repurchase right, a holder shall deliver to the Trustee on or before
the close of business on the Business Day immediately preceding the Repurchase Date
(i) written notice to the Company (or agent designated by the Company for such purpose) of
the holder’s exercise of such right in substantially the form attached hereto as Exhibit
C (the “Repurchase Notice”), which Repurchase Notice shall set forth the name of the
holder, the principal amount of the Notes to be repurchased, and a statement that an
election to exercise the repurchase right is being made thereby, and (ii) the Notes with
respect to which the repurchase right is being exercised, duly endorsed for transfer to the
Company. Election of repurchase by a holder shall be revocable at any time prior to the
close of business on the last Business Day prior to the Repurchase Date, by delivering
written notice to that effect to the Trustee prior to the close of business on the Business
Day prior to the Repurchase Date.




(c) If the Company fails to repurchase on the Repurchase Date any Notes (or portions
thereof) as to which the repurchase right has been properly exercised, then the principal of
such Notes shall, until paid, bear interest to the extent permitted by applicable law from
the Repurchase Date at the rate borne by the Note and each such Note shall be convertible
into Common Stock in accordance with this Indenture (without giving effect to
Section 16.2(b)) until the principal of such Note shall have been paid or duly provided for.




(d) Any Note that is to be repurchased only in part shall be surrendered to the Trustee
duly endorsed for transfer to the Company and accompanied by appropriate evidence of
genuineness and authority satisfactory to the Company and the Trustee duly executed by, the
holder thereof (or his attorney duly authorized in writing), and the Company shall execute,
and the Trustee shall authenticate and deliver to the holder of such Note without service
charge, a new Note or Notes, containing identical terms and conditions, of any authorized
denomination as requested by such holder in aggregate principal amount equal to and in
exchange for the unrepurchased portion of the principal of the Note so surrendered.




(e) On or prior to 1:00 p.m., New York City time on the Repurchase Date, the Company
shall deposit with the Trustee or with a paying agent (or, if the Company is acting as its
own paying agent, segregate and hold in trust as provided in Section 5.4) the Repurchase
Price in cash for payment to the holder on the Repurchase Date. If on or after the date of
repurchase the Company shall have deposited (or segregated and be holding in trust) funds
sufficient to pay the Repurchase Price of all Notes (or portions thereof) as to which the
holders have duly exercised their repurchase rights pursuant to this Section 16.2, then on
and after such date interest on such Notes (or portions thereof) shall cease to accrue and
such Notes shall cease at the close of business on such date to be convertible into Common
Stock and, except as provided in Section 8.5 and Section 13.4, to be entitled to any benefit
or security under this Indenture and the holders thereof shall have no right in respect of
such Notes except the right to receive the Repurchase Price of such Notes (or portions
thereof), without interest thereon from the date of repurchase.




(f) If the Company is unable to repurchase on the Repurchase Date all of the Notes (or
portions thereof) as to which the repurchase right has been properly exercised, the
aggregate amount of Notes the Company may repurchase shall be allocated pro rata among each
Note (or portion thereof) surrendered for repurchase, based on the principal amount of such
Note, in proportion to the aggregate amount of Notes surrendered for repurchase.




(g) All Notes delivered for repurchase shall be delivered to the Trustee to be canceled
in accordance with the provisions of Section 2.8.




(h) If any of the foregoing provisions are inconsistent with applicable law, such law
shall govern.




(i) When complying with the requirements of this Article XVI, the Company shall comply
with the requirements of Rules 13e 4 and 14e 1 (or any successor rules) under the Exchange
Act and any other federal or state securities laws to the extent such laws are applicable at
the time to such actions under this Article XVI.



Section 16.3 Certain Definitions



For purposes of this Article XVI:




(a) The term “beneficial owner” shall be determined in accordance with Rule 13d-3
and 13d-5, as in effect on the date of the original execution of this Indenture, promulgated
by the Commission pursuant to the Exchange Act.




(b) The term “person” or “group” shall include any syndicate or group which would be
deemed to be a “person” under Section 13(e) and 14(d) of the Exchange Act as in effect on
the date of the original execution of this Indenture.




(c) The term “Continuing Director” means at any date a member of the Company’s Board of
Directors (i) who was a member of such board on the date of the Securities Purchase
Agreement or (ii) who was nominated or elected by at least a majority of the directors who
were Continuing Directors at the time of such nomination or election or whose election to
the Company’s Board of Directors was recommended or endorsed by at least a majority of the
directors who were Continuing Directors at the time of such nomination or election or such
lesser number comprising a majority of a nominating committee if authority for such
nominations or elections has been delegated to a nominating committee whose authority and
composition have been approved by at least a majority of the directors who were Continuing
Directors at the time such committee was formed. (Under this definition, if the Board of
Directors of the Company as of the date of this Indenture were to approve a new director or
directors and then resign, no Change in Control would occur even though all of the current
members of the Board of Directors would thereafter cease to be in office).




(d) The term “Repurchase Event” means a Change in Control or a Termination of Trading.




(e) A “Change in Control” shall be deemed to have occurred when (i) any“person” or
“group” (as such terms are used in Sections 13(e) and 14(d) of the Exchange Act) other than
Alonim Investments, Inc., together with its affiliates, is or becomes the beneficial owner
of shares representing more than 50% of the combined voting power of the then outstanding
securities entitled to vote generally in elections of directors of the Company (the “Voting
Stock”); (ii) Alonim Investments, Inc., together with its affiliates, is or becomes the
beneficial owner of shares representing more than 65% of the combined voting power of the
then outstanding securities entitled to vote generally in elections of directors the Voting
Stock; (iii) approval by the shareholders of the Company of any plan or proposal for the
liquidation, dissolution or winding up of the Company; (iv) the Company (A) consolidates
with or merges into any other corporation or any other corporation merges into the Company,
and in the case of any such transaction, the outstanding Common Stock of the Company is
changed or exchanged into other assets or securities as a result or (B) conveys, transfers
or leases all or substantially all of its assets to any Person (other than a wholly-owned
subsidiary as a result of which the Company becomes a holding company), unless in either
such case the shareholders of the Company immediately before such transaction own, directly
or indirectly immediately following such transaction, at least a majority of the combined
voting power of the outstanding voting securities of the corporation resulting from such
transaction in substantially the same proportion as their ownership of the Voting Stock
immediately before such transaction; or (v) any time Continuing Directors do not constitute
a majority of the Board of Directors of the Company (or, if applicable, a successor
corporation to the Company); provided that a Change in Control shall not be deemed to have
occurred if at least ninety percent (90%) of the consideration (excluding cash payments for
fractional shares) in the transaction or transactions constituting the Change in Control
consists of (and the capital stock into which the Notes would be convertible consists of)
 shares of capital stock that are, or upon issuance will be, traded on a United States
national securities exchange or approved for trading on an established automated
over-the-counter trading market in the United States.




(f) A “Termination of Trading” shall have occurred if, after the time, if any, that the
Common Stock is authorized for quotation or listing on The New York Stock Exchange, Inc.
(the “NYSE”), the American Stock Exchange, Inc. (“AMEX”) or The Nasdaq National Market or
Capital Market (“NASDAQ”), the Common Stock of the Company shall thereafter not be
authorized for such quotation or listing.



ARTICLE XVII




MISCELLANEOUS PROVISIONS




Section 17.1 Provisions Binding on Company’s Successors



All the covenants, stipulations, promises and agreements of the Company contained in this
Indenture shall bind its successors and assigns whether so expressed or not.



Section 17.2 Official Acts by Successor Corporation



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



Section 17.3 Addresses for Notices, Etc.



Any notice or demand which by any provision of this Indenture is required or permitted to be
given or served by the Trustee or by the holders of Notes on the Company and any notice, direction,
request or demand hereunder to or upon the Trustee or to or upon any Noteholder shall be deemed to
have been sufficiently given or made, for all purposes (i) upon receipt, when delivered personally;
(ii) upon receipt, when sent by facsimile (evidence by mechanically or electronically generated
receipt by the sender’s facsimile machine); (iii) one (1) Business Day after deposit with a
nationally recognized overnight delivery service; or (iv) three (3) Business Days after deposit in
the United States mail, with first-class postage pre-paid, mailed by registered or certified mail;
in each case properly addressed to the party to receive the same. The addresses and facsimile
numbers of such communications shall be:



	 	 	 	 	 
	If to the Company:
	 	 	 	 
	Sipex Corporation
233 South Hillview Drive
Milpitas, California 95035
Telephone:
	 	 	(408) 934-7500	 
	Facsimile:
	 	 	(408) 934-7600	 
	Attention:
	 	Ray Wallin








If to the Trustee:



Wells Fargo Bank, National Association



707 Wilshire Blvd, 17th Floor



Los Angeles, CA 90017



Attention: Corporate Trust Services



Facsimile:  (213) 614-3355




If to a Noteholder:




At the address and facsimile number of such Noteholder, as
set forth on the Note Register, which shall initially include
the information set forth in the Securities Purchase
Agreement regarding notices.



The Trustee, by notice to the Company, may designate additional or different addresses for
subsequent notices or communications. The Trustee shall use reasonable commercial efforts to
provide any notice of default, notice of redemption and notice of conversion to each holder by
facsimile, if and to the extent such holder’s facsimile number is set forth in the Note Register.



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



Section 17.4 Governing Law; Jurisdiction; Jury Trial



This Indenture and each Note shall be deemed to be a contract made under the laws of the State
of New York and for all purposes shall be construed in accordance with the internal laws of the
State of New York without giving effect to any choice of law or conflict of law provision or rule
(whether of the State of New York or any other jurisdictions) that would cause the application of
the laws of any jurisdictions other than the State of New York. Each party hereby irrevocably
submits to the non-exclusive jurisdiction of the state and federal courts sitting in New York City,
for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in
any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is brought in an inconvenient forum or that
the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives
personal service of process and consents to process being served in any such suit, action or
proceeding by mailing a copy thereof to such party at the address for such notices to it under this
Indenture and agrees that such service shall constitute good and sufficient service of process and
notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law. If any provision of this Indenture shall be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the
validity or enforceability of the remainder of this Indenture in that jurisdiction or the validity
or enforceability of any provision of this Indenture in any other jurisdiction. EACH PARTY HEREBY
IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR
ANY TRANSACTION CONTEMPLATED HEREBY.



Section 17.5 Evidence of Compliance with Conditions Precedent; Certificates to Trustee



Upon any application or demand by the Company to the Trustee to take any action under any of
the provisions of this Indenture, the Company shall furnish to the Trustee an Officer’s Certificate
stating that in the opinion of the person executing such Officer’s Certificate all conditions
precedent, if any, provided for in this Indenture relating to the proposed action have been
complied with, and an Opinion of Counsel stating that, in the opinion of such counsel, all such
conditions precedent have been complied with.



Each certificate or opinion provided for by or on behalf of the Company in this Indenture and
delivered to the Trustee with respect to compliance with a condition or covenant provided for in
this Indenture shall include (1) a statement that the person making such certificate or opinion has
read such covenant or condition; (2) a brief statement as to the nature and scope of the
examination or investigation upon which the statement or opinion contained in such certificate or
opinion is based; (3) a statement that, in the opinion of such person, he has made such examination
or investigation as is necessary to enable him to express an informed opinion as to whether or not
such covenant or condition has been complied with; and (4) a statement as to whether or not, in the
opinion of such person, such condition or covenant has been satisfied or waived.



Section 17.6 Legal Holidays



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



Section 17.7 Trust Indenture Act



This Indenture is hereby made subject to, and shall be governed by, the provisions of the
Trust Indenture Act required to be part of and to govern indentures qualified under the Trust
Indenture Act; provided, however, that this Section 17.7 shall not require that
this Indenture or the Trustee be qualified under the Trust Indenture Act prior to the time such
qualification is in fact required under the terms of the Trust Indenture Act, nor shall it
constitute any admission or acknowledgment by any party hereto that any such qualification is
required prior to the time such qualification is in fact required under the terms of the Trust
Indenture Act. If any provision hereof limits, qualifies or conflicts with another provision
hereof that is required to be included in an indenture qualified under the Trust Indenture Act,
such required provision shall control.



Section 17.8 Benefits of Indenture



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



Section 17.9 Table of Contents, Headings, Etc.



The table of contents and the titles and headings of the articles and sections of this
Indenture have been inserted for convenience of reference only, are not to be considered a part
hereof, and shall in no way modify or restrict any of the terms or provisions hereof.



Section 17.10 Authenticating Agent



The Trustee may appoint an authenticating agent which shall be authorized to act on its behalf
and subject to its direction in the authentication and delivery of Notes in connection with the
original issuance thereof and transfers and exchanges of Notes hereunder, including under
Sections 2.4, 2.5, 2.6, 2.7, 3.3, 15.2, 15.3 and 16.2, as fully for all intents and purposes as
though the authenticating agent had been expressly authorized by this Indenture and those Sections
to authenticate and deliver Notes. For all purposes of this Indenture, the authentication and
delivery of Notes by the authenticating agent shall be deemed to be authentication and delivery of
such Notes “by the Trustee” and a certificate of authentication executed on behalf of the Trustee
by an authenticating agent shall be deemed to satisfy any requirement hereunder or in the Notes for
the Trustee’s certificate of authentication. Such authenticating agent shall at all times be a
Person eligible to serve as trustee hereunder pursuant to Section 8.9.



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



Any authenticating agent may at any time resign by giving written notice of resignation to the
Trustee and to the Company. The Trustee may at any time terminate the agency of any authenticating
agent by giving written notice of termination to such authenticating agent and to the Company.
Upon receiving such a notice of resignation or upon such a termination, or in case at any time any
authenticating agent shall cease to be eligible under this Section, the Trustee shall promptly
appoint a successor authenticating agent (which may be the Trustee), shall give written notice of
such appointment to the Company and shall send notice of such appointment to all holders of Notes
as the names and addresses of such holders appear on the Note Register.



The Company agrees to pay to the authenticating agent from time to time reasonable
compensation for its services.



The provisions of Sections 8.2, 8.3, 8.4, 9.3 and this Section 17.10 shall be applicable to
any authenticating agent.



Section 17.11 Execution in Counterparts



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



Section 17.12 Dispute Resolution.



In the case of a dispute as to the determination of the Closing Price, Market Price or the
arithmetic calculation of any conversion price, the Company shall submit the disputed
determinations or arithmetic calculations via facsimile within three (3) Business Days of receipt
of the Conversion Notice or other event giving rise to such dispute, as the case may be, to the
Trustee. If the Trustee and the Company are unable to agree upon such determination or calculation
within three (3) Business Days of such disputed determination or arithmetic calculation being
submitted to the Trustee, then the Company shall, within three (3) Business Days submit via
facsimile (a) the disputed determination of the Closing Price, or Market Price to an independent,
reputable investment bank selected by the Company and approved by the Trustee or (b) the disputed
arithmetic calculation of the conversion price to the Company’s independent, outside accountant.
The Company, at the Company’s expense, shall cause the investment bank or the accountant, as the
case may be, to perform the determinations or calculations and notify the Company and the Trustee
of the results no later than ten (10) Business Days from the time it receives the disputed
determinations or calculations. Such investment bank’s or accountant’s determination or
calculation, as the case may be, shall be binding upon all parties absent demonstrable error.



Section 17.13 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 Subsidiary of the Company. Any such indenture, loan or debt agreement may not be
used to interpret this Indenture.



Section 17.14 Severability



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



4




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



	 	 	 
	SIPEX CORPORATION

By:

	 	

/s/ Ralph Schmitt
	
 
	 	 







	 	 	Name: Ralph Schmitt

Title: CEO





Attest:



/s/ Clyde R. Wallin



Name:



Title: Sr. VP Finance & CFO




	 	 	 	WELLS
FARGO BANK, NATIONAL ASSOCIATION





	 	 	 
	as Trustee

By:

	 	

/s/ Maddy Hall
	
 
	 	 







	 	 	Name: Maddy Hall

Title: Assistant Vice President





[SIGNATURE PAGE TO INDENTURE]




5




EXHIBIT A




FORM OF 5.5% CONVERTIBLE SENIOR NOTE DUE 2026














SIPEX CORPORATION




[FORM OF FACE OF NOTE]




[THE FOLLOWING PARAGRAPH SHALL APPEAR ON THE FACE OF EACH RESTRICTED NOTE.]



THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”) OR APPLICABLE STATE SECURITIES LAWS. THIS SECURITY MAY NOT
BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS OR
PURSUANT TO AN EXEMPTION FROM THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS. THIS
SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY THIS
SECURITY.



[THE COMPANY MAY, BUT IS NOT OBLIGATED TO, INSTRUCT THE TRUSTEE TO PLACE THE FOLLOWING PARAGRAPH ON
THE FACE OF EACH NOTE HELD BY OR TRANSFERRED TO AN “AFFILIATE” (AS DEFINED IN RULE 501(B) OF
REGULATION D UNDER THE SECURITIES ACT) OF THE COMPANY:]



THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE HELD BY A PERSON WHO MAY BE DEEMED TO BE AN
AFFILIATE OF THE ISSUER FOR PURPOSES OF RULE 144 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), AND MAY BE SOLD ONLY IN COMPLIANCE WITH RULE 144 OR PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT. THE SECURITIES MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY THE SECURITIES.



[THE FOLLOWING PARAGRAPH SHALL APPEAR ON THE FACE OF EACH GLOBAL NOTE.]



THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS
NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY
PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE
REQUIRED PURSUANT TO SECTION 2.6 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE
BUT NOT IN PART PURSUANT TO SECTION 2.5(b) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE
DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.8 OF THE INDENTURE AND (IV) THIS
GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE
COMPANY.



[THE FOLLOWING PARAGRAPH SHALL APPEAR ON THE FACE OF EACH NOTE ISSUED WITH ORIGINAL ISSUE
DISCOUNT.]



FOR PURPOSES OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, THIS
NOTE IS BEING ISSUED WITH ORIGINAL ISSUE DISCOUNT. THE ISSUE DATE OF THIS NOTE IS MAY 16, 2006.
THE COMPANY AGREES TO PROVIDE PROMPTLY TO THE HOLDER OF THIS NOTE, UPON WRITTEN REQUEST, THE ISSUE
PRICE, AMOUNT OF ORIGINAL ISSUE DISCOUNT, ISSUE DATE AND YIELD TO MATURITY. ANY SUCH WRITTEN
REQUEST SHOULD BE SENT TO THE COMPANY AT THE FOLLOWING ADDRESS: SIPEX CORPORATION, 233 SOUTH
HILLVIEW DRIVE, MILPITAS, CA 95035, ATTENTION: CHIEF FINANCIAL OFFICER.



SIPEX CORPORATION




5.5% Convertible Senior Note due 2026




No.      $     



CUSIP No. [     ]



Sipex Corporation, a corporation duly organized and validly existing under the laws of the
State of Delaware (herein called the “Company”, which term includes any successor corporation under
the Indenture referred to on the reverse hereof), for value received hereby promises to pay to
     , or registered assigns, the principal sum of      United States Dollars
on May 16, 2026 and to pay interest on said principal sum semi-annually on May 15 and November 15
of each year (each, an “Interest Payment Date”), commencing November 15, 2006, at the rate per
annum specified in the title of this Note, accrued from the most recent date to which interest has
been paid or, if no interest has been paid, from May 16, 2006. The interest so payable
on any May 15 and November 15 will be paid to the person in whose name this Note, or portion
thereof (or one or more Predecessor Notes) is registered at the close of business on the record
date, which shall be the 4th day of the month in which the Interest Payment Date shall occur,
whether or not such date is a Business Day; provided that any such interest not punctually paid or
duly provided for shall be payable as provided in the Indenture. Payment of the principal of and
interest accrued on this Note (including Liquidated Damages, if any) shall be made at the office or
agency of the Company maintained for that purpose, which shall initially be the Corporate Trust
Office of the Trustee, or at any other office or agency permitted by the Indenture, in such lawful
money of the United States of America as at the time of payment shall be legal tender for the
payment of public and private debts; provided further, however, that, with respect to any holder of
Notes with an aggregate principal amount equal to or in excess of Five Hundred Thousand United
States Dollars ($500,000), interest on such holder’s Notes shall be paid by wire transfer in
immediately available funds to any bank located in the United States in accordance with the written
wire transfer instruction supplied by such holder from time to time to the Trustee and paying agent
(if different from the Trustee) in writing at least five (5) Business Days prior to the applicable
record date.



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



This Note shall be deemed to be a contract made under the laws of the State of New York, and
for all purposes shall be construed in accordance with and governed by the laws of said state.



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



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



** N.A. means Not Applicable.



6



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



SIPEX CORPORATION




[Name, Title]



Attest:



[Name, Title]



TRUSTEE’S CERTIFICATE OF AUTHENTICATION



Wells Fargo Bank, National Association,



as Trustee, certifies that this is one of the Notes described



in the within-named Indenture.



Dated:



By:



Authorized Signatory



7



[FORM OF REVERSE OF NOTE]




SIPEX CORPORATION




5.5% Convertible Senior Note due 2026




This Note is one of a duly authorized issue of Notes of the Company, designated as its 5.5%
Convertible Senior Notes due 2026 (herein called the “Notes”), limited except as otherwise provided
in the Indenture to the aggregate principal amount of Thirty Million United States Dollars,
($30,000,000) all issued or to be issued under and pursuant to an Indenture dated as of May
16, 2006 (herein called the “Indenture”), between the Company and Wells Fargo Bank, National
Association (herein called the “Trustee”), to which the Indenture and all indentures supplemental
thereto reference is hereby made for a description of the rights, limitations of rights,
obligations, duties and immunities thereunder of the Trustee, the Company and the holders of the
Notes. Additional Notes may be issued in an unlimited aggregate principal amount, subject to
certain conditions specified in the Indenture. All capitalized terms used herein without
definition shall have the meaning set forth in the Indenture.



In case an Event of Default, as defined in the Indenture, shall have occurred and be
continuing, the principal of, premium, if any, and accrued interest on all Notes may be declared,
and upon said declaration shall become, due and payable, in the manner, with the effect and subject
to the conditions provided in the Indenture. Share Delivery Damages paid pursuant to Section 15.2
of the Indenture, if any, shall be paid within ten (10) Business Days of the date from which such
Share Delivery Damages accrued pursuant to Section 15.2. Liquidated Damages on the Notes paid
pursuant to Section 2(f) of the Registration Rights Agreement, if any, shall be paid at the times
and in the manner provided therein.



The Indenture contains provisions permitting the Company and the Trustee in certain limited
circumstances, without the consent of the holders of the Notes, and in other circumstances, with
the consent of the holders of not less than 66 2/3% in aggregate principal amount of the Notes at
the time outstanding, evidenced as in the Indenture provided, to execute amendments to the
Indenture or supplemental indentures adding any provisions to or changing in any manner or
eliminating any of the provisions of the Indenture or of any supplemental indenture or modifying in
any manner the rights of the holders of the Notes; provided, however, that no such amendment or
supplemental indenture shall (i) extend the fixed maturity of any Note, or reduce the rate or
extend the time of payment of interest thereon, or reduce the principal amount thereof or premium,
if any, thereon, or reduce any amount payable on redemption or repurchase thereof, impair, or
change in any respect adverse to the holder of Notes, the obligation of the Company to repurchase
any Note at the option of the holder in accordance with Article XVI of the Indenture, or impair or
adversely affect the right of any Noteholder to institute suit for the payment thereof, or change
the currency in which the Notes are payable, or impair or change in any respect adverse to the
Noteholders the right to convert the Notes into Common Stock subject to the terms set forth in the
Indenture, including Section 15.6, or subordinate the Notes in right of payment to other
indebtedness, in each such case without the consent of the holder of each Note so affected, or
(ii) reduce the aforesaid percentage of Notes, the holders of which are required to consent to any
such supplemental indenture, without the consent of the holders of all Notes then outstanding.



It is also provided in the Indenture that the holders of not less than 66 2/3% in aggregate
principal amount of the Notes at the time outstanding may on behalf of the holders of all of the
Notes waive any past or existing default or Event of Default under the Indenture and its
consequences except (i) a default in the payment of interest or premium, if any, on, or the
principal of, the Notes when due, (ii) a failure by the Company to convert any Notes into Common
Stock or (iii) a default in respect of a covenant or provisions of the Indenture which under
Article XI thereof cannot be modified or amended without the consent of the holders of all Notes
then outstanding. Any such consent or waiver by a holder of this Note (unless revoked as provided
in the Indenture) shall be conclusive and binding upon such holder and upon all future holders and
owners of this Note and any Notes which may be issued in exchange or substitution hereof,
irrespective of whether any notation thereof is made upon this Note or such other Notes.



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



If by August 15, 2006, the Company has not filed with the Securities and Exchange Commission
all reports then required to be filed by the Company in accordance with Section 13 or 15(d) under
the Exchange Act, including, without limitation, an Annual Report on Form 10-K for the year ended
January 1, 2005 and Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2005,
June 30, 2005, September 30, 2005 and March 31, 2006, the then-applicable per annum interest rate
of the Notes shall be increased by 1.5% for the period beginning on August 16, 2006 and ending on
the date on which all the Company has made all such filings with the Commission.



If by December 31, 2006, the Common Stock is not listed for trading on the Principal Market,
the then-applicable per annum interest rate of the Notes shall be increased by 1.5% for the period
beginning on January 1, 2007 and ending on the date on which all the Common Stock is listed for
trading on a Principal Market.



The interest rate on the Notes shall be increased pursuant to the immediately preceding two
paragraphs up to a maximum of 3% per annum in the event that the Company fails to meet both the
Exchange Act Filing Deadline and the Principal Market Listing Deadline until such time as either
the Company has filed all such Exchange Act Reports or listed the Common Stock on a Principal
Market.



It is also provided in the Indenture that the Company may pay any interest due on the Notes
(but not including any Liquidated Damages) in whole or in part in cash and/or through the issuance
of Common Stock; provided that the Equity Conditions are satisfied (or waived by 66 2/3% of the
Required Holders) during the period commencing five (5) Business Days prior to the Interest Payment
Date through such Interest Payment Date. Common Stock used to pay any such Interest payment shall
be valued at ninety percent (90%) of the Current Market Price of the Common Stock as of the date
two (2) Business Days prior to the applicable Interest Payment Date. If any fractional share of
Common Stock otherwise would be issuable as a result of the issuance of Common Stock to pay
interest due on the Notes, the Company shall calculate and pay a cash adjustment in lieu of such
fractional share at the Current Market Price thereof to the holder of Notes.



The Notes are issuable in registered form without coupons in denominations of One Thousand
United States Dollars ($1,000) principal amount and integral multiples thereof. At the office of
Trustee or the Company referred to on the face hereof, and in the manner and subject to the
limitations provided in the Indenture, without payment of any service charge but with payment of a
sum sufficient to cover any tax, assessments or other governmental charges that may be imposed in
connection with any registration or exchange of Notes, Notes may be exchanged for a like aggregate
principal amount of Notes of other authorized denominations.



From and after May 21, 2009, the Company may, at its option, redeem all or any part of the
Notes, upon notice as set forth in the Indenture, and the Company shall pay each holder of Notes
redeemed a redemption price equal to the principal amount of such Notes, plus accrued and unpaid
interest thereon, if any, to, but excluding, the date of redemption.



If such notice of redemption has been given as provided in the Indenture, the Notes or portion
of Notes called for redemption shall, unless converted into Common Stock pursuant to the terms of
the Indenture, become due and payable on the date and at the place or places stated in such notice
at the Redemption Price, and on and after such date (unless the Company shall default in the
deposit of the amount of money sufficient to redeem such Notes) interest on the Notes or portion of
Notes so called for redemption shall cease to accrue and such Notes shall cease after the close of
business on the Business Day next preceding the date fixed for redemption to be convertible into
Common Stock and, except as provided in Sections 8.5 and 13.4 of the Indenture, to be entitled to
any benefit or security under the Indenture, and the holders of such Notes shall have no right in
respect of such Notes except the right to receive the Redemption Price. On presentation and
surrender of such Notes at a place of payment specified in such Redemption Notice, such Notes or
the specified portions thereof to be redeemed shall be paid and redeemed by the Company at the
Redemption Price; provided that, if the applicable redemption date is an Interest Payment Date,
then the semi-annual payment of interest becoming due on such date shall be payable to the holders
of such Notes registered as such on the relevant record date subject to the terms and provisions of
Section 2.3 of the Indenture.



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



Upon the occurrence of a “Repurchase Event,” the Noteholder has the right, at such holder’s
option, to require the Company to repurchase all or any portion of such holder’s Notes or any
portion thereof (in the principal amounts of One Thousand United States Dollars ($1,000) or
integral multiples thereof) on the date set by the Company that is no less than thirty (30) and no
more than forty (40) calendar days (or, if such 40th day is not a Business Day, the next succeeding
Business Day) after notice delivered following the occurrence of such Repurchase Event at a price
equal to 100% of the principal amount of the Notes such holder elects to require the Company to
repurchase, plus accrued interest to but not including the date fixed for repurchase (the
‘Repurchase Price”); provided that if such Repurchase Date is an Interest Payment Date, then the
semi-annual payment of interest becoming due on such date shall be payable to the holders of such
Notes registered as such on the relevant record date subject to the terms and provisions of Section
2.3 of the Indenture. If a redemption date pursuant to Article III of the Indenture shall occur
prior to any Repurchase Date established pursuant to a Company Notice under Section 16.2 of the
Indenture, provided that the Company shall have deposited or set aside an amount of money
sufficient to redeem such Notes as set forth in Section 3.2 of the Indenture on or before such
Repurchase Date, all such Notes shall be redeemed pursuant to Article III of the Indenture and the
repurchase rights under Article XVI of the Indenture shall have no effect.



In addition, Notes shall be purchased by the Company at the option of the holder on May 15,
2011, May 15, 2016 and May 15, 2021 at the Repurchase Price.



Subject to the provisions of the Indenture, the holder hereof has the right, at its option, at
any time following the date of original issuance of the Notes and prior to the close of business on
May 16, 2026 (except that, with respect to any Note or portion of a Note that shall be called for
redemption, such right shall terminate, except as otherwise provided in the Indenture, at the close
of business on the Business Day next preceding the date fixed for redemption unless the Company
shall default in payment due upon redemption), to convert the principal hereof or any portion of
such principal which is One Thousand United States Dollars ($1,000) or an integral multiple
thereof, into that number of fully paid and non-assessable shares of the Company’s Common Stock, as
said shares shall be constituted at the date of conversion, obtained by dividing the principal
amount of this Note or portion thereof to be converted by the conversion price of $2.68 or such
conversion price as adjusted from time to time as provided in the Indenture, upon surrender of this
Note, together with a conversion notice as provided in the Indenture and this Note, to the Company
at the office or agency of the Company maintained for that purpose, which shall initially be the
Corporate Trust Office of the Trustee, or at any other office or agency permitted by the Indenture,
and, unless the shares issuable on conversion are to be issued in the same name as this Note, duly
endorsed by, or accompanied by instruments of transfer in form satisfactory to the Company duly
executed by, the holder or by his duly authorized attorney. The Company shall pay in cash, on this
Note or portion thereof surrendered for conversion during the period from the close of business on
any Interest Payment Date to which interest has been fully paid through the close of business on
the Business Day preceding the record date for the next such Interest Payment Date, accrued and
unpaid interest, if any, to, but excluding, the date of conversion. Any such payment of interest
shall be made with ten (10) Business Days after the Conversion Date. Notwithstanding the
foregoing, if this Note shall be surrendered for conversion during the period from the close of
business on any record date for any Interest Payment Date through the close of business on the
Business Day next preceding such Interest Payment Date, the holder (unless the Note or the portion
thereof being converted shall have been called for redemption pursuant to a redemption notice sent
to the Noteholders in accordance with Section 3.2 of the Indenture or shall have become due prior
to such Interest Payment Date as a result of exercise of the repurchase right set forth in Article
XVI of the Indenture) must, at the time of conversion of the Note, pay by wire transfer of
immediately available funds or other funds acceptable to the Company, an amount equal to the
interest otherwise payable on such Interest Payment Date on the principal amount being converted;
provided, however, that no such payment need be made if there shall exist at the time of conversion
a default in the payment of interest on the Notes (subject to certain exceptions in the Indenture).
No fractional shares of Common Stock will be issued upon any conversion, but an adjustment in cash
will be paid to the holder, as provided in the Indenture, in respect of any fraction of a share
which would otherwise be issuable upon the surrender of any Note or Notes for conversion.



The Conversion Price shall equal $2.68. subject to such adjustment from time to time as
provided in the Indenture.



The Company may, at its option, automatically convert all or a portion of the Notes (an
“Automatic Conversion”) at any time prior to May 16, 2026, if (a) the Closing Price (as defined in
the Indenture) per share of the Common Stock has exceeded One Hundred Fifty percent (150%) of the
Conversion Price then in effect for at least twenty (20) Trading Days within a period of thirty
(30) consecutive Trading Days ending within five (5) Trading Days of the date the Company gives to
all holders of Notes a notice specifying the date on which an Automatic Conversion will become
effective is sent to all holders of Notes, and (b) the Equity Conditions shall have been satisfied
as of the date of the Automatic Conversion Notice. Notwithstanding anything herein to the
contrary, if at any time prior to the Automatic Conversion Date the Equity Conditions are no longer
satisfied, the Company shall provide a notice to the Trustee and each holder of Notes of such
failure and, unless the Required Holders waive such failure, the Company shall be required to
withdraw the Automatic Conversion Notice.



Unless the Company shall have theretofore called for redemption all of the Notes then
outstanding, if the Company elects to convert all or a portion of the Notes pursuant to its
Automatic Conversion right, the Company, or at its request (which must be received by the Trustee
at least five (5) Business Days prior to the date the Trustee is requested to give notice as
described below unless a shorter period is agreed to by the Trustee), the Trustee in the name of
and at the expense of the Company, shall send or cause to be sent a notice of the Automatic
Conversion not more than thirty (30) days but not less than five (5) days before the date of
effectiveness of the Automatic Conversion as set forth in the Indenture. In case the Notes are to
be converted in part only, the notice shall state the portion of the principal amount thereof to be
converted and shall state that on and after the effective date of the Automatic Conversion, upon
surrender of such Note, a new Note or Notes in principal amount equal to the unconverted portion
thereof will be issued.



In connection with any redemption of Notes, the Company may arrange for the purchase and
conversion of any Notes not converted prior to the expiration of such conversion right by an
agreement with one or more investment bankers or other purchasers to purchase such Notes by paying
to the Trustee in trust for the Noteholders, on or before the date fixed for redemption, an amount
not less than the applicable redemption price and interest accrued to the date fixed for
redemption, of such Notes.



Upon due presentment for registration of transfer of this Note and any other documents as may
be required to be delivered by the Indenture at the office or agency of the Company which shall be
the Corporate Trust Office of the Trustee, or at any other office or agency permitted by the
Indenture, a new Note or Notes of authorized denominations for an equal aggregate principal amount
will be issued to the transferee in exchange thereof, subject to the requirements and limitations
provided in the Indenture, without charge except for any tax or other governmental charge imposed
in connection therewith.



The Company, the Trustee, any authenticating agent, any paying agent, any conversion agent and
any Note Registrar may deem and treat a registered holder hereof as the absolute owner of this Note
(whether or not this Note shall be overdue and notwithstanding any notation of ownership or other
writing hereon), for the purpose of receiving payment hereof (including Liquidated Damages to the
extent accrued but unpaid), or on account hereof, for the conversion hereof and for all other
purposes; and neither the Company nor the Trustee nor any other authenticating agent nor any paying
agent nor any other conversion agent nor any Note Registrar shall be affected by any notice to the
contrary. All such payments so made to, or upon the order of, such registered holder for the time
being shall be valid, and, to the extent of the sum or sums so paid, effectual to satisfy and
discharge the liability for monies payable on this Note.



No direct or indirect partner, employee, incorporator, stockholder, director or officer, as
such, past, present or future of the Company or any successor Person or any Subsidiary or any of
the Company’s Affiliates, shall have any personal liability in respect of the obligations of the
Company under this Note or the Indenture by reason of his, her or its status as such partner,
employee, incorporator, stockholder, director or officer. The holder hereof by accepting this Note
waives and releases all such liability. Such waiver and release are part of the consideration for
the issuance of this Note.



8



ABBREVIATIONS




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



	 	 	 	 	 
	TEN COM - as tenants in common	 	UNIF GIFT MIN ACT -
	 	 	_____________________________ Custodian
	 	 	(Cust)
	TEN ENT — as tenants by the entireties
	 	 	—	 
	 
	 	(Minor)

	JT TEN — as joint tenants with right
of survivorship and not as tenants
	 	Uniform Gifts to Minors Act ___________

	in common
	 	(State)







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



9



SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE




The following exchanges of a part of this Global Note for an interest in another Global Note or for
a Definitive Note, or exchanges of a part of another Global Note or Definitive Note for an interest
in this Global Note, have been made:



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	Principal Amount	 	 
	 	 	 	 	Amount of decrease	 	Amount of increase	 	of this Global Note	 	Signature of
	 	 	 	 	in Principal Amount	 	in Principal Amount	 	following such	 	authorized officer
	 	 	 	 	of	 	of	 	decrease (or	 	of Trustee or Note
	Date of Exchange	 	this Global Note	 	this Global Note	 	increase)	 	Custodian






10




EXHIBIT B




[FORM OF CONVERSION NOTICE]




Sipex Corporation


233 South Hillview Drive


Milpitas, California 95035


Attention: Chief Financial Officer



Wells Fargo Bank, National Association


707 Wilshire Blvd, 17th Floor


Los Angeles, CA 90017


Attention: Corporate Trust Services


Fax:  (213) 614-3355



The undersigned registered owner of this Note hereby irrevocably exercises the option to
convert this Note, or the portion hereof (which is One Thousand United States Dollars ($1,000)
principal amount or an integral multiple thereof) below designated, into shares of Common Stock in
accordance with the terms of the Indenture referred to in this Note, and directs that the shares
issuable and deliverable upon such conversion, together with any check in payment for fractional
shares and any Notes representing any unconverted principal amount hereof, be issued and delivered
to the registered holder hereof unless a different name has been indicated below. If shares or any
portion of this Note not converted are to be issued in the name of a person other than the
undersigned, the undersigned will pay all transfer taxes payable with respect thereto and, if
applicable, deliver a Certificate of Transfer. Any amount required to be paid by the undersigned
on account of interest accompanies this Note.



If you want the shares issuable on conversion of this Note credited to your balance account
with The Depositary Trust Company through its Deposit Withdrawal At Custodian system, check the
box: o



Dated:      



     




     




Signature(s)



     



Signature Guarantee



Signature(s) must be guaranteed by an
eligible Guarantor Institution (banks,
stock brokers, savings and loan
associations and credit unions) with
membership in an approved signature
guarantee medallion program pursuant to
Securities and Exchange Commission
Rule 17Ad-15 if shares of Common Stock are
to be issued, or Notes to be delivered,
other than to and in the name of the
registered holder.



11



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



     



(Name)



     



(Street Address)



     



(City, State and Zip Code)



Please print name and address




Principal amount to be converted (if less
than all): $     ,000




Social Security or Other Taxpayer
Identification Number



12




EXHIBIT C




[FORM OF OPTION TO ELECT REPAYMENT




UPON A REPURCHASE DATE]




Sipex Corporation


233 South Hillview Drive


Milpitas, California 95035


Attention: Chief Financial Officer



Wells Fargo Bank, National Association


707 Wilshire Blvd, 17th Floor


Los Angeles, CA 90017


Attention: Corporate Trust Services


Fax:  (213) 614-3355



The undersigned registered owner of this Note hereby acknowledges receipt of a notice from
Sipex Corporation (the “Company”) as to the occurrence of a Repurchase Date and requests and
instructs the Company to repay the entire principal amount of this Note, or the portion thereof
(which is One Thousand United States Dollars ($1,000) principal amount or an integral multiple
thereof) below designated, in accordance with the terms of the Indenture referred to in this Note,
together with accrued interest (including Liquidated Damages, if any) to, but excluding, such date
(unless otherwise provided in the Indenture), to the registered holder hereof.



Dated:      




Signature(s)




Social Security or Other Taxpayer
Identification Number




Principal amount to be repaid (if less than
all): $     ,000



13




NOTICE: The above signatures of the holder(s) hereof must correspond with the name as written upon

the face of the Note in every particular without alteration or enlargement or any change

whatever.EXHIBIT D




FORM OF CERTIFICATE OF TRANSFER




Sipex Corporation


233 South Hillview Drive


Milpitas, California 95035


Attention: Chief Financial Officer



Wells Fargo Bank, National Association


707 Wilshire Blvd, 17th Floor


Los Angeles, CA 90017


Attention: Corporate Trust Services


Fax:  (213) 614-3355




	 	 	 	Re: 5.5% Convertible Senior Notes due 2026





Reference is hereby made to the Indenture, dated as of May 16, 2006 (the
“Indenture”), among Sipex Corporation, as issuer (the “Company”), and Wells Fargo, National
Association (the “Trustee”). Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.



     , (the “Transferor”) owns and proposes to transfer the Note[s] or interest
in such Note[s] specified in Annex A hereto, in the principal amount of $     in such
Note[s] or interests (the “Transfer”), to      (the “Transferee”), as
further specified in Annex A hereto. In connection with the Transfer, the Transferor hereby
certifies that:



[CHECK ALL THAT APPLY]




1.  ̈ Check if Transferee will take delivery of a beneficial interest in the
144A Global Note or a Definitive Note Pursuant to Rule 144A. 



The Transfer is being effected pursuant to and in accordance with Rule 144A under the United
States Securities Act of 1933, as amended (the “Securities Act”), and, accordingly, the Transferor
hereby further certifies that the beneficial interest or Definitive Note is being transferred to a
Person that the Transferor reasonably believed and believes is purchasing the beneficial interest
or Definitive Note for its own account, or for one or more accounts with respect to which such
Person exercises sole investment discretion, and such Person and each such account is a “qualified
institutional buyer” within the meaning of Rule 144A in a transaction meeting the requirements of
Rule 144A and such Transfer is in compliance with any applicable blue sky securities laws of any
state of the United States. Upon consummation of the proposed Transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to
the restrictions on transfer enumerated in the Private Placement Legend printed on the 144A Global
Note and/or the Definitive Note and in the Indenture and the Securities Act.



2.  ̈ Check and complete if Transferee will take delivery of a beneficial interest
in the IAI Global Note or a Definitive Note pursuant to any provision of the Securities Act other
than Rule 144A or Rule 144.



The Transfer is being effected in compliance with the transfer restrictions applicable to
beneficial interests in Restricted Global Notes and Restricted Definitive Notes and pursuant to and
in accordance with the Securities Act and any applicable blue sky securities laws of any state of
the United States, and accordingly the Transferor hereby further certifies that (check one):




(a)  ̈ such Transfer is being effected pursuant to and in accordance with Rule
144 under the Securities Act;



or





(b)  ̈ such Transfer is being effected to the Company or a subsidiary
thereof;



or





(c)  ̈such Transfer is being effected pursuant to an effective registration
statement under the Securities Act and in compliance with the prospectus delivery
requirements of the Securities Act;



or





(d)  ̈such Transfer is being effected to an Institutional Accredited
Investor and pursuant to an exemption from the registration requirements of the Securities
Act other than Rule 144A or Rule 144, and the Transferor hereby further certifies that it
has not engaged in any general solicitation within the meaning of Regulation D under the
Securities Act and the Transfer complies with the transfer restrictions applicable to
beneficial interests in a Restricted Global Note or Restricted Definitive Notes and the
requirements of the exemption claimed, which certification is supported by (1) a
certificate executed by the Transferee in the form of Exhibit F to the Indenture
and (2) an Opinion of Counsel provided by the Transferor or the Transferee (a copy of
which the Transferor has attached to this certification), to the effect that such Transfer
is in compliance with the Securities Act. Upon consummation of the proposed transfer in
accordance with the terms of the Indenture, the transferred beneficial interest or
Definitive Note will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the IAI Global Note and/or the Definitive Notes and in the
Indenture and the Securities Act.



3.  ̈ Check if Transferee will take delivery of a beneficial interest in the
Unrestricted Global Note or of an Unrestricted Definitive Note.




(a)  ̈ Check if Transfer is pursuant to Rule 144. (i) The Transfer is being
effected pursuant to and in accordance with Rule 144 under the Securities Act and in
compliance with the transfer restrictions contained in the Indenture and any applicable
blue sky securities laws of any state of the United States and (ii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act. Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will no longer be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global Notes, on
Restricted Definitive Notes and in the Indenture.




(b)  ̈ Check if Transfer is Pursuant to Other Exemption. (i) The Transfer is
being effected pursuant to and in compliance with an exemption from the registration
requirements of the Securities Act other than Rule 144, and in compliance with the
transfer restrictions contained in the Indenture and any applicable blue sky securities
laws of any State of the United States and (ii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer in
accordance with the terms of the Indenture, the transferred beneficial interest or
Definitive Note will not be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Notes or Restricted Definitive
Notes and in the Indenture.



This certificate and the statements contained herein are made for your benefit and the benefit
of the Company.




[Insert Name of Transferor]




By:

Name:

Title:




Dated:      



Signature Guarantee



Signature(s) must be guaranteed by an
eligible Guarantor Institution (banks,
stock brokers, savings and loan
associations and credit unions) with
membership in an approved signature
guarantee medallion program pursuant to
Securities and Exchange Commission
Rule 17Ad-15 if shares of Common Stock are
to be issued, or Notes to be delivered,
other than to and in the name of the
registered holder.



14



ANNEX A TO CERTIFICATE OF TRANSFER





1. The Transferor owns and proposes to transfer the following:



[CHECK ONE OF (a) OR (b)]




(a)  ̈ a beneficial interest in the:



(i)  ̈ 144A Global Note (CUSIP      ), or



(ii)  ̈ IAI Global Note (CUSIP      ); or



(b)  ̈ a Restricted Definitive Note.



2. After the Transfer the Transferee will hold:



[CHECK ONE]




(a)  ̈ a beneficial interest in the:



(i)  ̈ 144A Global Note (CUSIP      ), or



(ii)  ̈ IAI Global Note (CUSIP      ); or



(iii)  ̈ Unrestricted Global Note (CUSIP      ); or



(b)  ̈ a Restricted Definitive Note; or



(c)  ̈ an Unrestricted Definitive Note,



in accordance with the terms of the Indenture.



15




EXHIBIT E




FORM OF CERTIFICATE OF EXCHANGE




Sipex Corporation


233 South Hillview Drive


Milpitas, California 95035


Attention: Chief Financial Officer



Wells Fargo Bank, National Association


707 Wilshire Blvd, 17th Floor


Los Angeles, CA 90017


Attention: Corporate Trust Services


Fax:  (213) 614-3355




	 	 	 	Re: 5.5% Convertible Senior Notes due 2026





(CUSIP [__________])




Reference is hereby made to the Indenture, dated as of May 16, 2006 (the “Indenture”),
among Sipex Corporation, as issuer (the “Company”), and Wells Fargo Bank, National Association (the
“Trustee”). Capitalized terms used but not defined herein shall have the meanings given to them in
the Indenture.



     , (the “Owner”) owns and proposes to exchange the Note[s] or
interest in such Note[s] specified herein, in the principal amount of $     in such Note[s]
or interests (the “Exchange”). In connection with the Exchange, the Owner hereby certifies that:



1. Exchange of Restricted Definitive Notes or Beneficial Interests in a Restricted Global
Note for Unrestricted Definitive Notes or Beneficial Interests in an Unrestricted Global Note.




(a)  ̈ Check if Exchange is from beneficial interest in a Restricted Global Note
to beneficial interest in an Unrestricted Global Note. In connection with the Exchange of
the Owner’s beneficial interest in a Restricted Global Note for a beneficial interest in an
Unrestricted Global Note in an equal principal amount, the Owner hereby certifies (i) the
beneficial interest is being acquired for the Owner’s own account without transfer, (ii)
such Exchange has been effected in compliance with the transfer restrictions applicable to
the Global Notes and pursuant to and in accordance with the United States Securities Act of
1933, as amended (the “Securities Act”), (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain compliance
with the Securities Act and (iv) the beneficial interest in an Unrestricted Global Note is
being acquired in compliance with any applicable blue sky securities laws of any state of
the United States.




(b)  ̈ Check if Exchange is from beneficial interest in a Restricted Global Note
to Unrestricted Definitive Note. In connection with the Exchange of the Owner’s beneficial
interest in a Restricted Global Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Definitive Note is being acquired for the Owner’s own account without
transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance with the
Securities Act, (iii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the Definitive Note is being acquired in compliance with any
applicable blue sky securities laws of any state of the United States.




(c)  ̈ Check if Exchange is from Restricted Definitive Note to beneficial
interest in an Unrestricted Global Note. In connection with the Owner’s Exchange of a
Restricted Definitive Note for a beneficial interest in an Unrestricted Global Note, the
Owner hereby certifies (i) the beneficial interest is being acquired for the Owner’s own
account without transfer, (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in
accordance with the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain compliance
with the Securities Act and (iv) the beneficial interest is being acquired in compliance
with any applicable blue sky securities laws of any state of the United States.




(d)  ̈ Check if Exchange is from Restricted Definitive Note to Unrestricted
Definitive Note. In connection with the Owner’s Exchange of a Restricted Definitive Note
for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Unrestricted
Definitive Note is being acquired for the Owner’s own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions applicable to
Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii)
the restrictions on transfer contained in the Indenture and the Private Placement Legend are
not required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable blue sky
securities laws of any state of the United States.



2. Exchange of Restricted Definitive Notes or Beneficial Interests in Restricted Global
Notes for Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes.




(a)  ̈ Check if Exchange is from beneficial interest in a Restricted Global Note
to Restricted Definitive Note. In connection with the Exchange of the Owner’s beneficial
interest in a Restricted Global Note for a Restricted Definitive Note with an equal
principal amount, the Owner hereby certifies that the Restricted Definitive Note is being
acquired for the Owner’s own account without transfer. Upon consummation of the proposed
Exchange in accordance with the terms of the Indenture, the Restricted Definitive Note
issued will continue to be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Definitive Note and in the Indenture and the
Securities Act.




(b)  ̈ Check if Exchange is from Restricted Definitive Note to beneficial
interest in a Restricted Global Note. In connection with the Exchange of the Owner’s
Restricted Definitive Note for a beneficial interest in the [CHECK ONE]  ̈144A Global
Note,  ̈IAI Global Note with an equal principal amount, the Owner hereby certifies (i)
the beneficial interest is being acquired for the Owner’s own account without transfer and
(ii) such Exchange has been effected in compliance with the transfer restrictions applicable
to the Restricted Global Notes and pursuant to and in accordance with the Securities Act,
and in compliance with any applicable blue sky securities laws of any state of the United
States. Upon consummation of the proposed Exchange in accordance with the terms of the
Indenture, the beneficial interest issued will be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the relevant Restricted Global Note
and in the Indenture and the Securities Act.



This certificate and the statements contained herein are made for your benefit and the benefit
of the Company.




[Insert Name of Transferor]




By:

Name:

Title:




Dated:      



Signature Guarantee



Signature(s) must be guaranteed by an
eligible Guarantor Institution (banks, stock
brokers, savings and loan associations and
credit unions) with membership in an approved
signature guarantee medallion program
pursuant to Securities and Exchange
Commission Rule 17Ad-15 if shares of Common
Stock are to be issued, or Notes to be
delivered, other than to and in the name of
the registered holder.



16




EXHIBIT F




FORM OF TRANSFER LETTER OF REPRESENTATIONS




(TO BE DELIVERED BY HOLDER




UPON CERTAIN TRANSFERS OF NOTES WITHOUT




EFFECTIVE REGISTRATION STATEMENT)




We are delivering this letter in connection with the sale or transfer to us of Notes (as
defined in the Indenture, dated as of May 16, 2006, between Sipex Corporation, a
Delaware corporation (the “Company”) and Wells Fargo Bank, National Asociation, a national banking
corporation (the “Trustee”)) other than pursuant to a registration statement that has been declared
effective under the Securities Act of 1933, as amended (the “Securities Act”).



We hereby confirm that:




	 	(i)	 	we are an “accredited investor” within the meaning of Rule 501(a)(1),(2), (3),
(5), (6), (7) or (8) under the Securities Act;






	 	(ii)	 	any purchase or receipt of the Notes by us will be for investment purposes and
for our own account, not as a nominee or agent;






	 	(iii)	 	we have such knowledge and experience in financial and business matters that
we are capable of evaluating the merits and risks of purchasing or receiving the Notes;






	 	(iv)	 	we do not have need for liquidity in our investment in the Notes, we have the
ability to bear the economic risks of our investment in the Notes for an indefinite
period of time and we are able to afford the complete loss of our investment in the
Notes;






	 	(v)	 	we are not acquiring the Notes with a view to any distribution thereof in a
transaction that would violate the Securities Act or the securities laws of any State
of the United States or any other applicable jurisdiction, and we have no present
intention of selling, granting any participation in, or otherwise distributing the
same;






	 	(vi)	 	we have had access to such information regarding the Company necessary in order
for us to make an informed decision and any such information which we have requested
have been made available for us or our attorney, accountant, or advisor; and






	 	(vii)	 	we or our attorney, accountant, or advisor have had a reasonable opportunity
to ask questions of and receive answers from a person or persons acting on behalf of
the Company concerning the business, management and financial affairs of the Company
and the terms and conditions of the acquisition by us of the Notes and all such
questions have been answered to our full satisfaction, and we have acquired sufficient
information about the Company to make an informed and knowledgeable decision to acquire
the Notes.





We understand that the Notes have not been registered under the Securities Act, and we agree,
on our own behalf and on behalf of each account for which we acquire any Notes, that such Notes may
be offered, resold, pledged or otherwise transferred only (i) in accordance with an exemption from
the registration requirements of the Securities Act, (ii) to the Company or (iii) pursuant to an
effective registration statement, and, in each case, in accordance with any applicable securities
laws of any State of the United States or any other applicable jurisdiction. We agree that we will
furnish the Company and the Trustee an opinion of counsel, if the Company so requests, that the
foregoing restrictions on transfer have been complied with. We understand that the Trustee will
not be required to accept for registration of transfer any Notes, except upon presentation of
evidence satisfactory to the Company, including an opinion of counsel if the Company so requests,
that the foregoing restrictions on transfer have been complied with.



We acknowledge that the Company and others will rely upon our confirmations, acknowledgements
and agreements set forth herein, and we agree to notify you promptly in writing if any of our
representations or warranties herein ceases to be accurate and complete.



	 	 	 
	RODFRE HOLDING LLC

(Name)

By: /s/ Joe Prudente

Name: Joe Prudente

Title: Manager

Address:

	 	









41 Main Street

Bolton Massachusetts

01740
	 
	 	 







17