Exhibit 4.1


 




 





INDENTURE


 


Between


 


MINDSPEED TECHNOLOGIES, INC.


 


and


 


WELLS FARGO BANK, N.A., 

as Trustee


 


6.50%
CONVERTIBLE SENIOR NOTES DUE 2013


 


Dated
as of August 1, 2008




 





 

















 


CROSS-REFERENCE
TABLE*


 


	
  Trust Indenture Act Section

  	
   

  	
  Indenture Section

  
	
  310(a)(1)

  	
   

  	
  5.11

  	
   

  
	
        (a)(2)

  	
   

  	
  5.11

  	
   

  
	
        (a)(3)

  	
   

  	
  n/a

  	
   

  
	
        (a)(4)

  	
   

  	
  n/a

  	
   

  
	
        (a)(5)

  	
   

  	
  5.11

  	
   

  
	
        (b)

  	
   

  	
  5.3; 5.11

  	
   

  
	
        (c)

  	
   

  	
  n/a

  	
   

  
	
  311(a)

  	
   

  	
  5.12

  	
   

  
	
        (b)

  	
   

  	
  5.12

  	
   

  
	
        (c)

  	
   

  	
  n/a

  	
   

  
	
  312(a)

  	
   

  	
  2.9

  	
   

  
	
        (b)

  	
   

  	
  14.3

  	
   

  
	
        (c)

  	
   

  	
  14.3

  	
   

  
	
  313(a)

  	
   

  	
  5.7

  	
   

  
	
        (b)(1)

  	
   

  	
  n/a

  	
   

  
	
        (b)(2)

  	
   

  	
  n/a

  	
   

  
	
        (c)

  	
   

  	
  5.7;14.2

  	
   

  
	
        (d)

  	
   

  	
  5.7

  	
   

  
	
  314(a)(1),
  (2) and (3)

  	
   

  	
  9.4

  	
   

  
	
        (a)(4)

  	
   

  	
  9.5

  	
   

  
	
        (b)

  	
   

  	
  n/a

  	
   

  
	
        (c)(1)

  	
   

  	
  14.5

  	
   

  
	
        (c)(2)

  	
   

  	
  14.5

  	
   

  
	
        (c)(3)

  	
   

  	
  n/a

  	
   

  
	
        (d)

  	
   

  	
  n/a

  	
   

  
	
        (e)

  	
   

  	
  14.6

  	
   

  
	
        (f)

  	
   

  	
  n/a

  	
   

  
	
  315(a)

  	
   

  	
  5.2

  	
   

  
	
        (b)

  	
   

  	
  5.6;14.2

  	
   

  
	
        (c)

  	
   

  	
  5.1

  	
   

  
	
        (d)

  	
   

  	
  5.1

  	
   

  
	
        (e)

  	
   

  	
  4.14

  	
   

  
	
  316(a)(last
  sentence)

  	
   

  	
  2.12

  	
   

  
	
        (a)(1)(A)

  	
   

  	
  4.5

  	
   

  
	
        (a)(1)(B)

  	
   

  	
  4.4

  	
   

  
	
        (a)(2)

  	
   

  	
  n/a

  	
   

  
	
        (b)

  	
   

  	
  4.7

  	
   

  
	
        (c)

  	
   

  	
  n/a

  	
   

  
	
  317(a)(1)

  	
   

  	
  4.8

  	
   

  
	
        (a)(2)

  	
   

  	
  4.9

  	
   

  
	
        (b)

  	
   

  	
  2.5

  	
   

  
	
  318(a)

  	
   

  	
  14.1

  	
   

  
	
        (b)

  	
   

  	
  n/a

  	
   

  
	
        (c)

  	
   

  	
  14.l

  	
   

  



 






“n/a” means not applicable.


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


 


i

















 


TABLE OF CONTENTS


 


	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 1

  	
  DEFINITIONS AND INCORPORATION BY
  REFERENCE

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 1.1

  	
   

  	
  Definitions

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 1.2

  	
   

  	
  Incorporation by Reference of Trust Indenture Act

  	
   

  	
  13

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 1.3

  	
   

  	
  Rules of Construction

  	
   

  	
  13

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 2

  	
  THE NOTES

  	
   

  	
  14

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.1

  	
   

  	
  Title and Terms

  	
   

  	
  14

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.2

  	
   

  	
  Form of Notes

  	
   

  	
  15

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.3

  	
   

  	
  Global Note Legend

  	
   

  	
  16

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.4

  	
   

  	
  Execution, Authentication, Delivery and Dating of
  the Notes

  	
   

  	
  16

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.5

  	
   

  	
  Registrar and Paying Agent

  	
   

  	
  17

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.6

  	
   

  	
  Paying Agent to Hold Assets in Trust

  	
   

  	
  18

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.7

  	
   

  	
  General Provisions Relating to Registration,
  Transfer and Exchange

  	
   

  	
  18

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.8

  	
   

  	
  Book-Entry Provisions for the Global Notes

  	
   

  	
  19

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.9

  	
   

  	
  Holder Lists

  	
   

  	
  20

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.10

  	
   

  	
  Persons Deemed Owners

  	
   

  	
  21

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.11

  	
   

  	
  Mutilated, Destroyed, Lost or Stolen Notes

  	
   

  	
  21

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.12

  	
   

  	
  Treasury Notes

  	
   

  	
  22

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.13

  	
   

  	
  Temporary Notes

  	
   

  	
  22

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.14

  	
   

  	
  Cancellation

  	
   

  	
  22

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.15

  	
   

  	
  CUSIP Numbers

  	
   

  	
  22

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.16

  	
   

  	
  Defaulted Interest

  	
   

  	
  23

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.17

  	
   

  	
  Issuance of Additional Notes

  	
   

  	
  23

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 3

  	
  DISCHARGE OF INDENTURE

  	
   

  	
  23

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 3.1

  	
   

  	
  Discharge of Liability on Notes

  	
   

  	
  23

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 3.2

  	
   

  	
  Repayment to the Company

  	
   

  	
  24

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 4

  	
  DEFAULTS AND REMEDIES

  	
   

  	
  24

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.1

  	
   

  	
  Events of Default

  	
   

  	
  24

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.2

  	
   

  	
  Acceleration of Maturity; Rescission and Annulment

  	
   

  	
  26

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.3

  	
   

  	
  Other Remedies

  	
   

  	
  27

  



 


ii

















 


	
  Section 4.4

  	
   

  	
  Waiver of Past Defaults

  	
   

  	
  27

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.5

  	
   

  	
  Control by Majority

  	
   

  	
  27

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.6

  	
   

  	
  Limitation on Suit

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.7

  	
   

  	
  Unconditional Rights of Holders to Receive Payment
  and to Convert

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.8

  	
   

  	
  Collection of Indebtedness and Suits for Enforcement
  by the Trustee

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.9

  	
   

  	
  Trustee May File Proofs of Claim

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.10

  	
   

  	
  Restoration of Rights and Remedies

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.11

  	
   

  	
  Rights and Remedies Cumulative

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.12

  	
   

  	
  Delay or Omission Not Waiver

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.13

  	
   

  	
  Priorities

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.14

  	
   

  	
  Undertaking for Costs

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.15

  	
   

  	
  Waiver of Stay or Extension Laws

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.16

  	
   

  	
  Payment for Consent, Waiver or Amendment

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 5

  	
  THE TRUSTEE

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.1

  	
   

  	
  Certain Duties and Responsibilities

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.2

  	
   

  	
  Certain Rights of Trustee

  	
   

  	
  33

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.3

  	
   

  	
  Individual Rights of Trustee

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.4

  	
   

  	
  Money Held in Trust

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.5

  	
   

  	
  Trustee’s Disclaimer

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.6

  	
   

  	
  Notice of Defaults

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.7

  	
   

  	
  Reports by Trustee to Holders

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.8

  	
   

  	
  Compensation and Indemnification

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.9

  	
   

  	
  Replacement of Trustee

  	
   

  	
  36

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.10

  	
   

  	
  Successor Trustee by Merger, Etc

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.11

  	
   

  	
  Corporate Trustee Required; Eligibility

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.12

  	
   

  	
  Collection of Claims Against the Company

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 6

  	
  CONSOLIDATION, MERGER,
  CONVEYANCE, TRANSFER, SALE, LEASE OR OTHER DISPOSITION

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 6.1

  	
   

  	
  Company May Consolidate, Etc., Only on Certain
  Terms

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 6.2

  	
   

  	
  Successor Corporation Substituted

  	
   

  	
  38

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 7

  	
  AMENDMENTS, SUPPLEMENTS AND
  WAIVERS

  	
   

  	
  38

  



 


iii

















 


	
  Section 7.1

  	
   

  	
  Without Consent of Holders of Notes

  	
   

  	
  38

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 7.2

  	
   

  	
  With Consent of Holders of Notes

  	
   

  	
  39

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 7.3

  	
   

  	
  Compliance with Trust Indenture Act

  	
   

  	
  40

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 7.4

  	
   

  	
  Revocation of Consents and Effect of Consents or
  Votes

  	
   

  	
  40

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 7.5

  	
   

  	
  Notation on or Exchange of Notes

  	
   

  	
  40

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 7.6

  	
   

  	
  Trustee to Sign Amendment, Etc

  	
   

  	
  41

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 7.7

  	
   

  	
  Effect of Amendment

  	
   

  	
  41

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 8

  	
  [INTENTIONALLY OMITTED]

  	
   

  	
  41

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 9

  	
  COVENANTS

  	
   

  	
  41

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.1

  	
   

  	
  Payment of Principal, Repurchase Price and Interest

  	
   

  	
  41

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.2

  	
   

  	
  Maintenance of Offices or Agencies

  	
   

  	
  42

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.3

  	
   

  	
  Corporate Existence

  	
   

  	
  42

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.4

  	
   

  	
  Reports

  	
   

  	
  42

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.5

  	
   

  	
  Compliance Certificate

  	
   

  	
  43

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 10

  	
  [INTENTIONALLY OMITTED]

  	
   

  	
  44

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 11

  	
  PURCHASE AT THE OPTION OF A
  HOLDER

  	
   

  	
  44

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 11.1

  	
   

  	
  Purchase Right

  	
   

  	
  44

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 11.2

  	
   

  	
  Effect of Purchase Notice; Withdrawal

  	
   

  	
  46

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 11.3

  	
   

  	
  Deposit of Put Purchase Price

  	
   

  	
  47

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 11.4

  	
   

  	
  Notes Purchased in Part

  	
   

  	
  47

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 11.5

  	
   

  	
  Covenant to Comply With Securities Laws Upon
  Purchase of Notes

  	
   

  	
  47

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 11.6

  	
   

  	
  Repayment to the Company

  	
   

  	
  48

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 12

  	
  CONVERSION OF NOTES

  	
   

  	
  48

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 12.1

  	
   

  	
  Conversion Right; Expiration of Conversion Right;
  Conversion Price

  	
   

  	
  48

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 12.2

  	
   

  	
  Exercise of Conversion Right

  	
   

  	
  51

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 12.3

  	
   

  	
  Fractions of Shares

  	
   

  	
  52

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 12.4

  	
   

  	
  Adjustment of Conversion Price

  	
   

  	
  52

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 12.5

  	
   

  	
  Consolidation or Merger of the Company

  	
   

  	
  61

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 12.6

  	
   

  	
  Notice of Adjustments of Conversion Price

  	
   

  	
  63

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 12.7

  	
   

  	
  Notice Prior to Certain Actions

  	
   

  	
  63

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 12.8

  	
   

  	
  Company to Reserve Common Stock; Listing

  	
   

  	
  64

  



 


iv

















 


	
  Section 12.9

  	
   

  	
  Common Stock to be Fully Paid and Nonassessable

  	
   

  	
  65

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 12.10

  	
   

  	
  Taxes on Conversions

  	
   

  	
  65

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 12.11

  	
   

  	
  Cancellation of Converted Notes

  	
   

  	
  65

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 12.12

  	
   

  	
  Option to Satisfy Conversion Obligation with Cash,
  Common Stock or Combination Thereof

  	
   

  	
  65

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 12.13

  	
   

  	
  Responsibility of Trustee for Conversion Provisions

  	
   

  	
  69

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 12.14

  	
   

  	
  Withholding Taxes on Adjustments of the Conversion
  Price

  	
   

  	
  69

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 12.15

  	
   

  	
  Limitations on Conversion

  	
   

  	
  69

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 13

  	
  [INTENTIONALLY OMITTED]

  	
   

  	
  71

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 14

  	
  OTHER PROVISIONS OF GENERAL
  APPLICATION

  	
   

  	
  71

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.1

  	
   

  	
  Trust Indenture Act Controls

  	
   

  	
  71

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.2

  	
   

  	
  Notices

  	
   

  	
  71

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.3

  	
   

  	
  Communication by Holders with Other Holders

  	
   

  	
  72

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.4

  	
   

  	
  Acts of Holders of Notes

  	
   

  	
  72

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.5

  	
   

  	
  Certificate and Opinion as to Conditions Precedent

  	
   

  	
  73

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.6

  	
   

  	
  Statements Required in Certificate or Opinion

  	
   

  	
  74

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.7

  	
   

  	
  Effect of Headings and Table of Contents

  	
   

  	
  74

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.8

  	
   

  	
  Successors and Assigns

  	
   

  	
  74

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.9

  	
   

  	
  Separability Clause

  	
   

  	
  74

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.10

  	
   

  	
  Benefits of Indenture

  	
   

  	
  75

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.11

  	
   

  	
  Governing Law

  	
   

  	
  75

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.12

  	
   

  	
  Counterparts

  	
   

  	
  75

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.13

  	
   

  	
  Legal Holidays

  	
   

  	
  75

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.14

  	
   

  	
  Recourse Against Others

  	
   

  	
  75

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.15

  	
   

  	
  Tax Treatment

  	
   

  	
  75

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EXHIBITS

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EXHIBIT
  A

  	
   

  	
  Form of
  Note

  	
   

  	
  A-1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EXHIBIT
  B

  	
   

  	
  Form of
  Purchase Notice

  	
   

  	
  B-1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EXHIBIT
  C

  	
   

  	
  Form of
  Conversion Notice

  	
   

  	
  C-1

  



 


v

















 


INDENTURE,
dated as of August 1, 2008 (this “Indenture”),
between Mindspeed Technologies, Inc., a corporation duly organized and
existing under the laws of the State of Delaware, having its principal office
at 4000 MacArthur Boulevard, East Tower, Newport Beach, California  92660-3095 (the “Company”) and Wells Fargo Bank, N.A., a national banking
association organized under the laws of the United States, as Trustee (the “Trustee”), having its corporate trust
office at 707 Wilshire Boulevard, 17th Floor, Los Angeles,
California 90017.


 


RECITALS
OF THE COMPANY


 


WHEREAS,
pursuant to an Exchange Agreement dated as of July 30, 2008 (the “Exchange Agreement”) between the Company and certain holders
of 3.75% Convertible Senior Notes due 2009 (the “3.75%
Convertible Senior Notes”) issued by the Company, such holders and
the Company have agreed to exchange $15,000,000 of the 3.75% Convertible Senior
Notes held by such holders into an issue of 6.50% Convertible Senior Notes due
2013 (the “Initial  Notes”) issued by the Company on the terms, tenor, amount and
other provisions hereinafter set forth, and, to provide therefor, the Company
has duly authorized the execution and delivery of this Indenture; and


 


WHEREAS,
all things necessary to make the Initial Notes, when the Initial Notes are duly
executed by the Company and authenticated and delivered hereunder and duly
issued by the Company, the valid obligations of the Company, and to make this
Indenture a valid and binding agreement of the Company, in accordance with
their and its terms, have been done.


 


NOW,
THEREFORE, for and in consideration of the premises and the exchange of 3.75%
Convertible Senior Notes by the holders thereof for the Initial Notes, it is
mutually covenanted and agreed, for the equal and proportionate benefit of all
Holders, as follows:


 


ARTICLE 1



DEFINITIONS AND INCORPORATION BY REFERENCE


 


Section 1.1            Definitions.  For all purposes of this Indenture and the Notes, the following terms are
defined as follows:


 


“120% Trading
Price Exception” has the meaning set forth in the definition of
Fundamental Change.


 


“3.75% Convertible Senior
Notes” has the meaning ascribed to it in the first paragraph under
the caption “Recitals of the Company”.


 


“Act”,
when used with respect to any Holder, has the meaning set forth in Section 14.4(a).


 


“Additional Common
Stock” has the meaning set forth in Section 12.1(b).


 


“Additional Interest”
means the additional interest, if any, payable on the Notes pursuant to Section 9.4(c).


 


1

















 


“Additional Notes”
means any Notes (other than the Initial Notes) issued under this Indenture in
accordance with Sections 2.2, 2.4 and 2.17.


 


“Affiliate” of any specified Person
means any other Person directly or indirectly controlling or controlled by or
under direct or indirect common control with such specified Person.  For purposes of this definition, “control,”
as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided that beneficial ownership of 10% or more of
the Voting Stock of a Person will be deemed to be control.  For purposes of this definition, the terms “controlling,”
“controlled by” and “under common control with” have correlative meanings.


 


“Agent Members”
has the meaning set forth in Section 2.8(a).


 


“Applicable Stock
Price” has the
meaning set forth in Section 12.12(d).


 


“Bankruptcy Law”
means Title 11 of the U.S. Code or any similar federal or state law for the
relief of debtors.


 


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


 


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


 


“Business Day”
means, with respect to any Note, any day, other than a Saturday or Sunday, that
is not a legal holiday or a day in which in The City of New York banking
institutions are authorized by law or regulation to close.


 


“Buy-In” has the meaning set forth in Section 12.12(c).


 


“Buy-In Price” has the meaning set forth in Section 12.12(c).


 


“Capital Lease Obligation” means, at the time any determination
is to be made, the amount of the liability in respect of a capital lease that
would at that time be required to be capitalized on a balance sheet prepared in
accordance with GAAP.


 


“Capital Stock”
means:


 


(a)           in the case of a corporation, corporate stock;


 


(b)           in the case of an association or business entity, any and
all shares, interests, participations, rights or other equivalents (however
designated) of corporate stock;


 


2

















 


(c)           in the case of a partnership or limited liability company,
partnership interests (whether general or limited) or membership interests; and


 


(d)           any other interest or participation that confers on a
Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person, but excluding from all of the
foregoing any debt securities convertible into Capital Stock, whether or not
such debt securities include any right of participation with Capital Stock.


 


“Cash Amount”
has the meaning set forth in Section 12.12(a).


 


“Closing Date”
means August 1, 2008.


 


“Closing Time”
means the time at which the closing of the exchange of the Notes is complete
pursuant to the Exchange Agreement on the Closing Date.


 


“Commission”
means the Securities and Exchange Commission or any successor agency.


 


“Common Stock”  means any stock of any class of the Company which
has no preference in respect of dividends or of amounts payable in the event of
any voluntary or involuntary liquidation, dissolution or winding up of the
Company and which is not subject to redemption by the Company.  However, subject to the provisions of
Sections 12.5 and 12.7 hereof, shares issuable on conversion of the Notes shall
include only shares of the class designated as Common Stock, $0.01 par value
per share, of the Company at the date of execution of this Indenture or shares
of any class or classes resulting from any reclassification or
reclassifications thereof and which have no preference in respect of dividends
or of amounts payable in the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Company and which are not subject to
redemption by the Company, provided that if at any time there shall be more
than one such resulting class, the shares of each such class then so issuable
shall be substantially in the proportion which the total number of shares of
such class resulting from all such reclassifications bears to the total number
of shares of all such classes resulting from all such reclassifications.


 


“Company”
means the corporation named as the “Company” in the first paragraph of this
instrument until a successor Person shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter “Company” shall mean
such successor Person.


 


“Company Order”
means a written order signed in the name of the Company by any Officer.


 


“Continuing Director”
means, as of any date of determination, any member of the Board of Directors
who:


 


(a)           was a member of the Board of
Directors of the Company on the date hereof; or


 


3

















 


(b)           was nominated for election, appointed
or elected to the Board of Directors with the approval of a majority of the
Continuing Directors who were members of the Board of Directors at the time of
the new director’s nomination, appointment or election, either by a specific
vote or by approval of the proxy statement issued by the Company on behalf of
the Company’s entire Board of Directors in which such individual is named as a
nominee for director.


 


“Conversion Agent”
means any Person authorized by the Company to convert Notes in accordance with Article
12. Initially, the Conversion Agent shall be Wells Fargo Bank, N.A.  The Company may change the Conversion Agent,
but in no event will the Conversion Agent be an affiliate of the Company.


 


“Conversion Date”
means, with respect to any Holder, the date on which such Holder has satisfied
all the requirements to convert its Notes pursuant to Section 12.2.


 


“Conversion
Obligation” has the meaning set forth in Section 12.12(a).


 


“Conversion Period”
has the meaning set forth in Section 12.12(d).


 


“Conversion Price”
has the meaning set forth in Section 12.1(a).


 


“Conversion Rate”, at any time, shall equal $1,000
divided by the Conversion Price at such time, rounded to three decimal places
(rounded up if the fourth decimal place thereof is 5 or more and otherwise
rounded down).


 


“Conversion 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 shares of any class of Capital Stock of the Company or evidences
of its Indebtedness, cash or other assets, or in which the Common Stock (or
other applicable security) is exchanged for or converted into any combination
of shares of any class of Capital Stock of the Company or evidences of its
Indebtedness, cash or other assets, the date fixed for determination of
stockholders 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).


 


“Conversion
Retraction Period” has the meaning set forth in Section 12.12(a).


 


“Conversion Value”
has the meaning set forth in Section 12.12(d).


 


“Corporate Trust
Office” means, for purposes of presentation or surrender of Notes
for payment, registration, transfer, exchange or conversion or for service of
notices or demands upon the Company or for any other purpose of this Indenture,
the office or agent of the Trustee located at 707 Wilshire Boulevard, 17th
Floor, Los Angeles, California  90017.


 


“corporation”
means any corporation, association, limited liability company, company and
business trust.


 


“Current Market
Price” has the meaning set forth in Section 12.4(g).


 


4
















 


“Custodian”
means any receiver, trustee, assignee, liquidator, sequestrator or similar
official under any Bankruptcy Law.


 


“Default”
means an event which is, or after notice or lapse of time or both would
constitute, an Event of Default.


 


“Defaulted
Payment” has the meaning set forth in Section 4.1(b).


 


“Defaulted
Interest” has the meaning set forth in Section 2.16.


 


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


 


“distributed
assets” has the meaning set forth in Section 12.4(d).


 


“Dollar”
or “$” means a U.S. dollar or
other equivalent unit in such coin or currency of the United States as at the
time shall be legal tender for the payment of public and private debts.


 


“Effective
Date” has the meaning set forth in Section 12.1(b).


 


“Event of
Default” has the meaning set forth in Section 4.1.


 


“Ex-Dividend
Time” means, with respect to any issuance or distribution on shares
of Common Stock, the first date on which the shares of Common Stock trade
regular way on the principal securities market on which the shares of Common
Stock are then traded without the right to receive such issuance or
distribution.


 


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


 


“Exchange
Agreement” has the meaning ascribed to it in the first paragraph
under the caption “Recitals of the Company”.


 


“Expiration
Time” has the meaning set forth in Section 12.4(f).


 


“Fair
Market Value” means, if there is a current market for the asset,
debt or transaction in question, the amount that a willing buyer would pay a
willing seller in an arm’s length transaction or, in the absence of a current
market for such asset, debt or transaction, the amount determined in good faith
by the Board of Directors that represents its determination of the fair market
value of the asset.


 


“Financial Statement
Delivery Default” means any failure to deliver a report required by Section 9.4(a) or
(b) by the 180th day after the Required Delivery Date.


 


“Fundamental
Change” means the occurrence of any of the following events after
the Closing Date:


 


5

















 


(a)           the acquisition by any Person,
directly or indirectly, through a purchase, merger or other acquisition
transaction or series of purchases, mergers or other acquisition transactions
of beneficial ownership of shares of the Capital Stock of the Company entitling
that Person to exercise
50% or more of the total Voting Stock of the Company, other than any
acquisition by the Company, any of its subsidiaries or any of their employee
benefit plans; or


 


(b)           the first day on which a majority of
the members of the board of directors of the Company does not consist of
Continuing Directors; or


 


(c)           the Company consolidates or merges
with or into any other Person, any merger of another Person into the Company,
or any conveyance, transfer, sale, lease or other disposition of all or
substantially all of the Company’s properties and assets to another Person,
other than:  (A) any
transaction:  (1) that does not
result in any reclassification, conversion, exchange or cancellation of
outstanding shares of the Company’s Capital Stock; and (2) pursuant to
which the holders of 50% or more of the total Voting Stock of the Company
immediately prior to the transaction have the right to exercise, directly or
indirectly, 50% or more of the total Voting Stock of the continuing or
surviving Person immediately after giving effect to such transaction; and (B) any
merger primarily for the purpose of changing the Company’s jurisdiction of
incorporation and resulting in a reclassification, conversion or exchange of
outstanding shares of Common Stock, if at all, solely into shares of common
stock of the surviving entity; or


 


(d)           the termination of trading of the
Common Stock, which shall be deemed to have occurred if the Common Stock or
other common stock into which the Notes are convertible is not listed for
trading on a U.S. national securities exchange or any similar U.S. system of
automated dissemination of quotations of securities prices or traded in
over-the-counter securities markets, and no American Depositary Shares or
similar instruments for such common stock are so listed or approved for listing
in the United States.


 


Notwithstanding
the foregoing, the Company shall not be required to purchase the Notes of the
Holders upon a Fundamental Change pursuant to Section 11.1 (and a
Fundamental Change shall be deemed not to have occurred) if:


 


(I)            the Market Price per share of Common
Stock for any five Trading Days within:


 


(1)           the period of 10
consecutive Trading Days ending immediately after the later of the Fundamental
Change or the public announcement of the Fundamental Change, in the case of a
Fundamental Change under clause (a) or (b) of the definition of “Fundamental
Change” above, or


 


(2)           the period of 10
consecutive Trading Days ending immediately before the Fundamental Change, in
the case of a Fundamental Change under clause (c) or (d) of the
definition of “Fundamental Change” above,


 


6

















 


equals or exceeds 120% of the Conversion
Price of the Notes in effect on each of those five Trading Days (the “120% Trading Price Exception”); or


 


(II)           more
than 90% of the consideration in the transaction or transactions (other than
cash payments for fractional shares and cash payments made in respect of
dissenters’ appraisal rights) which otherwise would constitute a Fundamental
Change under clause (a), (b) or (c) above consists of shares of
common stock, depositary receipts or other certificates representing common
equity interests traded or to be traded immediately following such transaction
on a national securities exchange, and, as a result of the transaction or
transactions, the Notes become convertible solely into such Common Stock,
depositary receipts or other certificates representing common equity interests
(and any rights attached thereto).


 


For the
purposes of this definition (x) whether a Person is a “beneficial owner”
shall be determined in accordance with Rule 13d-3 and Rule 13d-5 under the
Exchange Act and (y) the term “Person” includes any syndicate or group
that would be deemed to be a “person” under Section 13(d)(3) of the
Exchange Act.


 


“GAAP”
has the meaning set forth in Section 1.3(b).


 


“Global
Note” has the meaning set forth in Section 2.2(a).


 


“Group”
has the same meaning as that used for the purposes of Section 13 under the
Exchange Act.


 


“Guarantee” means a guarantee
other than by endorsement of negotiable instruments for collection in the
ordinary course of business, direct or indirect, in any manner including,
without limitation, by way of a pledge of assets or through letters of credit
or reimbursement agreements in respect thereof, of all or any part of any
Indebtedness (whether arising by virtue of partnership arrangements, or by
agreements to keep-well, to purchase assets, goods, securities or services, to
take or pay or to maintain financial statement conditions or otherwise).


 


“Hedging Obligations” means,
with respect to any specified Person, the obligations of such Person incurred
in the normal course of business and not for speculative purposes under:


 


(a)           interest rate swap agreements
(whether from fixed to floating or from floating to fixed), interest rate cap
agreements and interest rate collar agreements;


 


(b)           other agreements or arrangements
designed to manage interest rates or interest rate risk; and


 


(c)           other agreements or arrangements
designed to protect such Person against fluctuations in currency exchange rates
or commodity prices.


 


7

















 


“Holder”,
when used with respect to any Note, including any Global Note, means the Person
in whose name the Note is registered in the Register.


 


“Holder Adjustable
Conversion Limitation” has the meaning
set forth in Section 12.15(a).


 


“Indebtedness” means, with
respect to any specified Person, any indebtedness of such Person (excluding
accrued expenses and trade payables), whether or not contingent:


 


(a)           in respect of borrowed money;


 


(b)           evidenced by bonds, notes, debentures
or similar instruments or letters of credit (or reimbursement agreements in
respect thereof);


 


(c)           in respect of banker’s acceptances;


 


(d)           representing Capital Lease
Obligations;


 


(e)           representing the balance deferred and
unpaid of the purchase price of any property or services due more than six
months after such property is acquired or such services are completed; or


 


(f)            representing any Hedging
Obligations,


 


if and to the extent any of the preceding items (other
than letters of credit and Hedging Obligations) would appear as a liability
upon a balance sheet of the specified Person prepared in accordance with
GAAP.  In addition, the term “Indebtedness”
includes the Guarantee by the specified Person of any Indebtedness of any other
Person.


 


“Indenture”
means this instrument as originally executed or as it may from time to time be
supplemented or amended by one or more supplemental indentures entered into
pursuant to the applicable provisions hereof.


 


“Initial  Notes” has the meaning ascribed to it in
the first paragraph under the caption “Recitals of the Company”.


 


“Interest”
means, with respect to any Note, the interest payable on such Note based upon
the Interest Rate and, if applicable, any Defaulted Interest.  For the avoidance of doubt, references to “Interest”
herein shall be deemed to also include Additional Interest, if any, regardless
of whether such interest is specifically referenced.


 


“Interest
Payment Date” means each February 1 and August 1, provided, however, that, if any such
date is not a Business Day, the Interest Payment Date shall be the next
succeeding Business Day, and no additional interest shall accrue.


 


“Interest
Rate” has the meaning set forth in Section 2.1(c).


 


8

















 


“Majority Owned” means having “beneficial ownership” (as
defined in Rule 13(d)(3) under the Exchange Act) of more than 50% of
the total Voting Stock of an entity.


 


“Majority
Owner” has the correlative meaning.


 


“Market
Price” of a security on any date of determination means:


 


(a)           the closing sale price (or, if no
closing sale price is reported, the last reported sale price) of such security
(regular way) on The Nasdaq Global Market on such date;


 


(b)           if such security is not listed for
trading on The Nasdaq Global Market on any such date, the closing sale price as
reported in the composite transactions for the principal U.S. securities
exchange on which such security is listed;


 


(c)           if such security is not so reported,
the last price quoted by Interactive Data Corporation for such security on such
date or, if Interactive Data Corporation is not quoting such price, a similar
quotation service selected by the Company;


 


(d)           if such security is not so quoted,
the average of the mid-point of the last bid and ask prices for such security
on such date from at least two dealers recognized as market-makers for such
security selected by the Company for this purpose; or


 


(e)           if such security is not so quoted,
the average of the last bid and ask prices for such security on such date from
a dealer engaged in the trading of such securities selected by the Company for
this purpose.


 


“Maturity”
means the date on which the Principal with respect to any Outstanding Note
becomes due and payable as therein or herein provided, whether at the Stated
Maturity or by acceleration, conversion, exercise of a purchase right or
otherwise.


 


“Nasdaq
Global Market” means the National Association of Securities Dealers
Automated Quotation Global Market or any successor national securities exchange
or automated over-the-counter trading market in the United States.


 


“Notes” means
the Initial Notes and any Additional Notes. 
The Initial Notes and the Additional Notes shall be treated as a single
class for all purposes under this Indenture, except that any Additional Notes
that are Restricted Notes may contain certain redemption provisions not
applicable to the Initial Notes, as contemplated by Section 2.14.  Unless the context otherwise requires, all
references to the Notes shall include the Initial Notes and any Additional
Notes.


 


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


 


9

















 


“Officers’
Certificate” means, with respect to the Company, a certificate
signed by both (1) the Chairman of the Board, the Chief Executive Officer,
the President or a Vice President and (2) so long as not the same as the
officer signing pursuant to clause (1), the Chief Operating Officer, the Chief
Financial Officer, the Treasurer, any Assistant Treasurer, the Secretary or any
Assistant Secretary of the Company and delivered to the Trustee.


 


“Opinion of
Counsel” means a written opinion of counsel, who may be counsel to
the Company (and may include directors or employees of the Company) and in form
and substance acceptable to the Trustee, which acceptance shall not be
unreasonably withheld.


 


“Outstanding”,
when used with respect to Notes, means, as of the date of determination, all
Notes theretofore authenticated and delivered under this Indenture, except
Notes:


 


(i)            previously canceled by the Trustee
or delivered to the Trustee for cancellation; and


 


(ii)           which have been paid in exchange for
or in lieu of other Notes which have been authenticated and delivered pursuant
to this Indenture, other than any such Notes in respect of which there shall
have been presented to the Trustee proof satisfactory to it that such Notes are
held by a bona fide purchaser
in whose hands such Notes are valid obligations of the Company;


 


provided, however, that in determining
whether the Holders of the requisite principal amount of Outstanding Notes have
consented to or voted in favor of any request, demand, authorization,
direction, notice, consent, waiver, amendment or modification hereunder, Notes
held for the account of the Company or of any of its Affiliates shall be
disregarded and deemed not to be Outstanding, except that in determining
whether the Trustee shall be protected in making such a determination or
relying upon any such consent or vote, only Notes which a Responsible Officer
of the Trustee actually knows to be so owned shall be so disregarded.


 


“Paying
Agent” has the meaning set forth in Section 2.5.


 


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


 


“Physical
Notes” means Notes issued in definitive, fully registered form
without interest coupons, substantially in the form of Exhibit A
hereto, with the applicable legends as provided in Section 2.3.


 


“Place of
Conversion” means any city in which any Conversion Agent is located.


 


“Place of
Payment” means any city in which any Paying Agent is located.


 


“Predecessor
Note” of any particular Note, means 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 2.11 in 


 


10

















 


exchange for
or in lieu of a mutilated, destroyed, lost or stolen Note shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Note.


 


“Principal”
means, with respect to any Outstanding Note, the principal amount of that Note,
including the Repurchase Price, if applicable, payable with respect to that
Note.


 


“Purchase Date” has the
meaning set forth in Section 11.1(a).


 


“Purchase Notice” has the
meaning set forth in Section 11.1(c).


 


“Purchase
Rights” has the meaning set forth in Section 11.1(a).


 


“Purchased
Shares” has the meaning set forth in Section 12.4(f).


 


“Put
Purchase Price” has the meaning set forth in Section 11.1(a).


 


“Reference
Period” has the meaning set forth in Section 12.4(d).


 


“Register”
has the meaning set forth in Section 2.5.


 


“Registrar”
has the meaning set forth in Section 2.5.


 


“Regular
Record Date” for the Interest payable on the Notes means the January 15
and the July 15 (whether or not a Business Day), as applicable, next
preceding the corresponding Interest Payment Date.


 


“Required Delivery Date”
means the date the Company is required to deliver to the Trustee Forms 10-K and
10-Q or reports containing substantially the same information pursuant to Section 9.4(a) or
(b).


 


“Responsible
Officer”, when used with respect to the Trustee, means any officer
of the Trustee, including any vice president, any assistant vice president, any
treasurer, any assistant treasurer, any trust officer, or any other officer of
the Trustee having direct responsibility for the administration of this
Indenture and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of such officer’s
knowledge of and familiarity with the particular subject.


 


“Rights Agreement” means that certain Rights Agreement dated
as of June 26, 2003, by and between the Company and Mellon Investor
Services, LLC , as rights agent thereunder, as amended, modified, supplemented
or restated from time to time, including any comparable agreement to which any
Person that is a successor to the Company under Article 6 is a party.


 


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


 


“Settlement
Notice Period” has the meaning set forth in Section 12.12(a).


 


11

















 


“Share Delivery Date”
means the later of (i) the date specified in the third paragraph of Section 12.12(a),
and (ii) the Conversion Date.


 


“Significant
Subsidiary” has the meaning assigned to it under Rule 405 of
the Securities Act.


 


“Stated
Maturity” has the meaning set forth in Section 2.1(b).


 


“Stock Price” has the meaning
set forth in Section 12.1(b).


 


“Subsidiary” means, with
respect to any specified Person:


 


(a)           any corporation, association or other
business entity of which more than 50% of the total voting power of shares of
Capital Stock entitled (without regard to the occurrence of any contingency and
after giving effect to any voting agreement or stockholders’ agreement that
effectively transfers voting power) to vote in the election of directors,
managers or trustees of the corporation, association or other business entity
is at the time owned or controlled, directly or indirectly, by that Person or
one or more of the other Subsidiaries of that Person (or a combination
thereof); and


 


(b)           any partnership (i) the sole
general partner or the managing general partner of which is such Person or a
Subsidiary of such Person or (ii) the only general partners of which are
that Person or one or more Subsidiaries of that Person (or any combination
thereof).


 


“TIA”
means the Trust Indenture Act of 1939, as amended (15 U.S. Code Section 77aaa-77bbbb),
as in effect on the date of this Indenture; provided, however, that in the event the TIA is amended after
such date, “TIA” means, to the extent required by such amendment, the Trust
Indenture Act of 1939, as so amended, or any successor statute.


 


“Trading
Day” means:


 


(a)           if the applicable security is listed
or admitted for trading on The Nasdaq Global Market or The Nasdaq Capital
Market, a day on which The Nasdaq Global Market or The Nasdaq Capital Market,
as applicable, is open for business;


 


(b)           if that security is not so listed or
admitted for trading on The Nasdaq Global Market or The Nasdaq Capital Market,
a day on which the principal U.S. securities exchange on which the securities
are listed is open for business; or


 


(c)           if the applicable security is not so
listed, admitted for trading or quoted, any day other than a Saturday or a
Sunday or a day on which banking institutions in the State of New York are
authorized or obligated by law or executive order to close.


 


“Trigger
Event” has the meaning set forth in Section 12.4(d).


 


12
















 


“Trustee”
means the Person named as the “Trustee” in the first paragraph of this
instrument until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter “Trustee” shall mean
such successor Trustee.


 


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


 


“Voting
Stock” of any specified Person as of any date means the Capital
Stock of such Person that is at the time entitled to vote in the election of
the board of directors of such Person.


 


Section 1.2            Incorporation
by Reference of Trust Indenture Act.


 


Whenever
this Indenture refers to a provision of the TIA, the provision is incorporated
by reference in and made a part of this Indenture.


 


The
following TIA terms used in this Indenture have the following meanings:


 


“indenture
securities” means the Notes;


 


“indenture
security holder” means a Holder;


 


“indenture
to be qualified” means this Indenture;


 


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


 


“obligor”
on the Notes means the Company and any other obligor on the indenture
securities.


 


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


 


Section 1.3            Rules of Construction.


 


For
all purposes of this Indenture, except as otherwise expressly provided or
unless the context otherwise requires:


 


(a)           the
terms defined in this Article have the meanings assigned to them in this Article and
include the plural as well as the singular;


 


(b)           all
accounting terms not otherwise defined herein have the meanings assigned to
them in accordance with generally accepted accounting principles in the United
States prevailing at the time of any relevant computation hereunder (“GAAP”);


 


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


 


13

















 


(d)           all
references to section and article numbers in this Indenture shall refer to
sections and articles hereof, unless otherwise specified.


 


ARTICLE 2



THE NOTES


 


Section 2.1            Title and Terms.


 


(a)           The
Notes shall be designated as the “6.50%
Convertible Senior Notes due 2013” of the Company.  The aggregate principal amount of Notes which
may be authenticated and delivered under this Indenture is limited to
$46,000,000 except for Notes authenticated and delivered upon registration of,
transfer of, or in exchange for, or in lieu of other Notes pursuant to Sections
2.7, 2.8, 7.5, 11.1 or 12.2  hereof.  The Notes shall be issuable in denominations
of $1,000 or integral multiples thereof.


 


(b)           The
Notes shall mature on August 1, 2013 (the “Stated Maturity”).


 


(c)           The
Notes shall bear Interest from the date of their original issuance until the
principal amount thereof is paid or made available for payment, or until such
date on which the Notes are converted or purchased as provided herein at a rate
of 6.50% per annum (including the Default Rate, if applicable, the “Interest Rate”).  Interest shall be payable semi-annually, in
arrears, on each Interest Payment Date.


 


(d)           Interest
on the Notes shall be computed (i) for any full semi-annual period for
which a particular Interest Rate is applicable, on the basis of a 360-day year
comprised of twelve 30-day months and (ii) for any period for which a
particular Interest Rate is applicable for less than a full semi-annual period
for which Interest is calculated, on the basis of a 30-day month and, for such
periods of less than a month, the actual number of days elapsed over a 30-day
month.


 


(e)           Interest
shall be due and payable on a Note as follows:


 


(i)            A registered Holder
as of the close of business on a Regular Record Date shall be entitled to
receive and shall receive (except as otherwise indicated in this Section 2.1(e)),
accrued and unpaid Interest on such Note from the preceding Interest Payment
Date (or such earlier date on which Interest was last paid) to the day prior to
the Interest Payment Date next succeeding such Regular Record Date.


 


(ii)           In the event that a
Note becomes subject to purchase pursuant to Article 11, a Holder who
exercises a Purchase Right with respect to such Note shall be entitled to
receive and shall receive accrued and unpaid Interest on such Note from the
preceding Interest Payment Date (or such earlier date to which Interest was
last paid) to, but excluding the applicable Purchase Date for such Note, which
amount shall be included in the applicable Repurchase Price thereof pursuant to
Article 11.


 


14

















 


(iii)          In the event that a
Note is converted pursuant to Article 12, the Holder who converts such
Note after a Regular Record Date but prior to the corresponding Interest
Payment Date shall not be entitled to receive accrued and unpaid Interest on such
Note from the preceding Interest Payment Date until the Conversion Date, such
amounts being deemed to have been paid by receipt of shares of Common Stock in
full rather than canceled, extinguished or forfeited.  As a result, a Holder which converts a Note
after a Regular Record Date but prior to the next succeeding Interest Payment
Date will receive accrued and unpaid Interest on such Note for such period on
such Interest Payment Date but will be required to remit to the Company an
amount equal to that Interest at the time such Holder surrenders the Note for
conversion pursuant to Article 12.


 


(f)            Payment
of any Principal or Interest, and Additional Interest, if any (in each case, to
the extent paid in cash), on Global Notes shall be payable by the Company to
the Depositary in immediately available funds.


 


(g)           Payment
of any Principal on Physical Notes shall be made at the office or agency of the
Company maintained for such purpose, initially the Corporate Trust Office of
the Trustee.  Interest and Additional
Interest on Physical Notes will be payable by (i) a U.S. Dollar check
drawn on a U.S. bank mailed to the address of the Person entitled thereto as
such address shall appear in the Register, or (ii) upon application to the
Registrar not later than the relevant Regular Record Date by a Holder of an
aggregate Principal amount of Notes in excess of $5,000,000, wire transfer in
immediately available funds, which application shall remain in effect until the
Holder notifies, in writing, the Registrar to the contrary.


 


(h)           The
Notes shall be purchased by the Company at the option of Holders as provided in
and subject to Article 11.


 


(i)            The
Notes shall be convertible at the option of the Holders as provided in and
subject to Article 12.


 


Section 2.2            Form of Notes.


 


(a)           Except
as otherwise provided pursuant to this Section 2.2, the Notes are issuable
in fully registered form, without coupons, in denominations of $1,000 and
integral multiples of $1,000 above that amount with any applicable legend as
provided for in Section 2.3 and in the form of one or more permanent
global securities, except as provided herein (each a “Global Note” and, collectively, the “Global Notes”), the form of which is
contained in Exhibit A hereto. 
The Notes shall not be issuable in bearer form.  The terms and provisions contained in the
form of Note 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)           The
Initial Notes are being exchanged by the Company for certain 3.75% Convertible
Senior Notes pursuant to the Exchange Agreement.  Additional Notes shall be exchanged by the
Company for 3.75% Convertible Senior Notes pursuant to an agreement between the
Company and the holder(s) of such notes being exchanged.  Notes shall be issued 


 


15

















 


initially in the form of one or more permanent global
Notes in fully registered form without interest coupons, substantially in the
form of Exhibit A hereto, with the applicable legend as provided in
Section 2.3.  Each Global Note shall
be duly executed by the Company and authenticated and delivered by the Trustee,
and shall be registered in the name of the Depositary or its nominee and
retained by the Trustee, as custodian. 
The aggregate principal amount of the Global Notes may from time to time
be increased or decreased by adjustments made on the records of the Trustee, as
custodian, and of the Depositary or its nominee, as hereinafter provided.


 


(c)           Physical
Notes may not be exchanged for interests in a Global Note.  Physical Notes shall be duly executed by the
Company and authenticated and delivered by the Trustee.


 


Section 2.3            Global Note Legend.


 


Each
Global Note shall bear the following legend on the face thereof:


 


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


 


TRANSFERS OF THIS GLOBAL NOTE
SHALL BE LIMITED TO TRANSFERS TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR TO
A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN ARTICLE TWO OF THE INDENTURE REFERRED TO ON THE
REVERSE HEREOF.


 


Section 2.4            Execution, Authentication, Delivery
and Dating of the Notes.


 


(a)           One
Officer shall execute the Notes on behalf of the Company by manual or facsimile
signature.  Notes bearing the manual or
facsimile signatures of individuals who were at the time of the execution of
the Notes the proper Officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices 


 


16

















 


prior to the authentication and delivery of such Notes
or did not hold such offices at the date of authentication of such Notes.


 


(b)           At
any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Notes executed by the Company to the Trustee
for authentication, together with a Company Order for the authentication and
delivery of such Notes, and the Trustee in accordance with such Company Order
shall authenticate and deliver such Notes as provided in this Indenture and not
otherwise.  No Note shall be entitled to
any benefit under this Indenture, or be valid or obligatory for any purpose,
unless there appears on such Note a certificate of authentication substantially
in the form provided for herein executed by or on behalf of the Trustee by
manual signature, and such certificate upon any Note shall be conclusive
evidence, and the only evidence, that such Note has been duly authenticated and
delivered hereunder.  The Trustee may
appoint an authenticating agent or agents reasonably acceptable to the Company
with respect to the Notes.  Unless
limited by the terms of such appointment, an authenticating agent may
authenticate Notes whenever the Trustee may do so.  Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent.


 


(c)           Each
Note shall be dated the date of its authentication.  The Trustee shall authenticate and deliver
Initial Notes for original issue in an aggregate principal amount of
$15,000,000 upon one or more Company Orders without any further action by the
Company.  The Trustee shall authenticate
and deliver Additional Notes from time to time for original issue in an
aggregate principal amount of up to $31,000,000 upon one or more Company Orders
without any further action by the Company.


 


Section 2.5            Registrar and Paying Agent.


 


The
Company shall maintain an office or agency where Notes may be presented for
registration of transfer or for exchange (the “Registrar”) and an office or agency where Notes may be
presented for payment (the “Paying Agent”).  The Registrar shall keep a register of the
Notes (the “Register”) and of
their transfer and exchange.  The Company
may appoint one or more co-Registrars and one or more additional Paying Agents
for the Notes.  The term “Paying Agent”
includes any additional paying agent and the term “Registrar” includes any
additional registrar.  The Company may
change any Paying Agent or Registrar without prior notice to any Holder.


 


The
Company will cause each Paying Agent (other than the Trustee) to execute and
deliver to the Trustee an instrument in which such Paying Agent shall agree
with the Trustee, subject to the provisions of this Section, that such Paying
Agent will:


 


(a)           hold all sums of money or Common
Stock held by it for the payment of any amounts due and payable in respect of
the Notes in trust for the benefit of the Persons entitled thereto until such
sums shall be paid to such Persons or otherwise disposed of as provided in this
Indenture;


 


(b)           give the Trustee notice of any
Default by the Company in the making of any such payment; and


 


17

















 


(c)           at any time during the continuance of
any such Default, upon the written request of the Trustee, forthwith pay to the
Trustee all sums so held in trust by such Paying Agent.


 


The Company shall give prompt written notice
to the Trustee of the name and address of any Paying Agent who is not a party
to this Indenture.  If the Company fails
to appoint or maintain another entity as Registrar or Paying Agent, the Trustee
shall act as such.


 


The Company hereby initially appoints the
Trustee, as Registrar and Paying Agent for the Notes.


 


Section 2.6            Paying Agent to Hold Assets in
Trust.


 


Prior to 11:00 a.m., New York City time,
on each due date for any payments in respect of any Note, the Company shall
deposit a sum of money in immediately available funds  sufficient to make such payments when so
becoming due.  The Company at any time
may require a Paying Agent to pay all money held by it to the Trustee.  Upon payment over to the Trustee, the Paying
Agent (if other than the Company) shall have no further liability for the money
so paid over to the Trustee.


 


If the Company shall act as a Paying Agent,
it shall, prior to or on each such due date, segregate and hold in trust for
the benefit of the Holders a sum sufficient with monies held by all other
Paying Agents, to pay such amounts so becoming due until such sums shall be
paid to such Persons or otherwise disposed of as provided in this
Indenture.  Upon any bankruptcy or
reorganization of the Company, the Trustee shall act as Paying Agent.


 


Section 2.7            General Provisions Relating to
Registration, Transfer and Exchange.


 


The Notes are issuable only in registered
form.  A Holder may transfer a Note only
by written application to the Registrar stating the name of the proposed
transferee and otherwise complying with the terms of this Indenture.  No such transfer shall be effected until, and
such transferee shall succeed to the rights of a Holder only upon, final
acceptance and registration of the transfer by the Registrar in the
Register.  Furthermore, any Holder of a
Global Note shall, by acceptance of such Global Note, agree that transfers of
beneficial interests in such Global Note may be effected only through a
book-entry system maintained by the Holder of such Global Note (or its agent)
and that ownership of a beneficial interest in the Global Note shall be required
to be reflected in a book-entry.


 


When Notes are presented to the Registrar
with a request to register the transfer or to exchange them for an equal
principal amount of Notes of other authorized denominations, the Registrar
shall register the transfer or make the exchange as requested if the
requirements hereunder for such transactions are met (including that such Notes
are duly endorsed or accompanied by a written instrument of transfer duly
executed by the Holder thereof or by an attorney who is authorized in writing
to act on behalf of the Holder).  Subject
to Section 2.4, to permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Notes at the Registrar’s
request.  No service charge shall be made
for any registration of transfer or exchange of the Notes, but the Company may
require payment of a sum sufficient to cover any transfer tax or similar
governmental charge payable in connection 


 


18

















 


therewith (other
than any such transfer taxes or other similar governmental charge payable upon
exchanges pursuant to Sections 2.13 or 7.5).


 


Neither the Company nor the Registrar shall
be required to exchange or register a transfer of any Notes surrendered for
conversion or, if a portion of any Note is surrendered for conversion, such
portion thereof surrendered for conversion.


 


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 (including any transfers between or
among Agent Members or beneficial owners of interests in any Global 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.


 


Section 2.8            Book-Entry Provisions for the Global
Notes.


 


(a)           The
Global Notes initially shall:


 


(i)            be registered in
the name of the Depositary; and


 


(ii)           be delivered to the
Trustee as custodian for such Depositary, for credit to the accounts of the members
of, and participants in, the Depositary (the “Agent
Members”) holding the Notes evidenced thereby.


 


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


 


(c)           The
registered Holder of a Global Note may grant proxies and otherwise authorize
any Person, including Agent Members and Persons that may hold interests through
Agent Members, to take any action that a Holder is entitled to take under this
Indenture or the Notes.


 


(d)           A
Global Note may not be transferred, in whole or in part, to any Person other
than the Depositary, and no such transfer to any such other Person may be
registered.  Beneficial interests in a
Global Note may be transferred in accordance with the rules and procedures
of the Depositary.


 


(e)           If
at any time:


 


19

















 


(i)            the Depositary
notifies the Company in writing that it is no longer willing or able to
continue to act as Depositary for the Global Notes, or the Depositary ceases to
be a “clearing agency” registered under the Exchange Act and a successor
depositary for the Global Notes is not appointed by the Company within 90 days
of such notice or cessation;


 


(ii)           the Company, at its
option, notifies the Trustee in writing that it elects to cause the issuance of
the Physical Notes under this Indenture in exchange for all or any part of the
Notes represented by a Global Note or Global Notes; or


 


(iii)          an Event of Default
has occurred and is continuing and the Registrar has received a request from
the Depositary for the issuance of Physical Notes in exchange for such Global
Note or Global Notes,


 


then the Depositary shall surrender such Global Note
or Global Notes to the Trustee for cancellation and the Company shall execute,
and the Trustee, upon receipt of an Officers’ Certificate and Company Order for
the authentication and delivery of Notes, shall authenticate and deliver in
exchange for such Global Note or Global Notes, Physical Notes in an aggregate
principal amount equal to the aggregate principal amount of such Global Note or
Global Notes.  Such Physical Notes shall
be registered in such names as the Depositary shall identify in writing as the
beneficial owners of the Notes represented by such Global Note or Global Notes
(or any nominee thereof).


 


(f)            Notwithstanding
the foregoing, in connection with any transfer of beneficial interests in a
Global Note to the beneficial owners thereof pursuant to Section 2.8(d) hereof,
the Registrar shall reflect on its books and records, and the custodian shall
reflect on its books and records and the schedule to the Global Note, the date
and a decrease in the aggregate principal amount of such Global Note in an
amount equal to the aggregate principal amount of the beneficial interest in
such Global Note to be transferred.


 


(g)           The
Registrar shall retain copies of all certifications, letters, notices and other
written communications received pursuant to this Section 2.8 in accordance
with its customary procedures for the retention of records relating to the
transfer of securities.  The Company
shall have the right to inspect and make copies of all such certifications,
letters, notices or other written communications at any reasonable time upon
the giving of reasonable written notice to the Registrar.


 


Section 2.9            Holder Lists.


 


The
Trustee shall preserve in as current a form as is reasonably practicable the most
recent list available to it of the names and addresses of Holders and shall
otherwise comply with Section 312(a) of the TIA.  If the Trustee is not the Registrar, the
Company shall furnish to the Trustee prior to or on each Interest Payment Date
and at such other times as the Trustee may request in writing a list in such
form and as of such date as the Trustee may reasonably require of the names and
addresses of Holders relating to such Interest Payment Date or request, as
applicable.


 


20

















 


Section 2.10         Persons
Deemed Owners.


 


Prior
to due presentment of a Note for registration of transfer, the Company, the
Trustee and any agent of the Company or the Trustee may treat the Person in
whose name such Note is registered as the owner of such Note for the purpose of
receiving payment of principal of the Note or the payment of any Repurchase
Price in respect thereof and any Interest and Additional Interest thereon, for
any purpose under this Indenture, whether or not such Note is overdue, and
neither the Company, the Trustee nor any agent of the Company or the Trustee
shall be affected by notice to the contrary.


 


Section 2.11         Mutilated, Destroyed, Lost or Stolen
Notes.


 


If any
mutilated Note is surrendered to the Trustee, the Company shall execute and the
Trustee shall authenticate and deliver in exchange therefor a new Note with the
same aggregate principal amount and bearing a number not contemporaneously
outstanding.


 


If
there is delivered to the Company and the Trustee:


 


(a)           evidence
to their satisfaction of the destruction, loss or theft of any Note, and


 


(b)           such
security or indemnity as may be required by them to save each of them and any
agent of either of them harmless, then, in the absence of actual notice to the
Company or the Trustee that such Note has been acquired by a bona fide purchaser, the Company
shall execute and, upon request, the Trustee shall authenticate and deliver, in
lieu of any such destroyed, lost or stolen Note, a new Note of like tenor and
principal amount, and bearing a number not contemporaneously outstanding.


 


In
case any such mutilated, destroyed, lost or stolen Note has become or is about
to become due and payable, the Company in its discretion, but subject to any
conversion rights, may, instead of issuing a new Note, pay such Note, upon
satisfaction of the condition set forth in the preceding paragraph.


 


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


 


Every
new Note issued pursuant to this Section 2.11 in lieu of any destroyed,
lost or stolen Note shall constitute an original contractual obligation of the
Company, whether or not the destroyed, lost or stolen Note shall be at any time
enforceable by anyone, and such new Note shall be entitled to all the benefits
of this Indenture equally and proportionately with any and all other Notes duly
issued hereunder.


 


The
provisions of this Section 2.11 are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Notes.


 


21

















 


Section 2.12         Treasury Notes.


 


In
determining whether the Holders of the requisite principal amount of
Outstanding Notes have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, Notes owned by the Company or any
Affiliate of the Company shall be disregarded and deemed not to be Outstanding,
except that, in determining whether the Trustee shall be protected in relying
upon any such request, demand, authorization, direction, notice, consent or
waiver, only such Notes of which the Trustee has received written notice and
are so owned shall be so disregarded.


 


Section 2.13         Temporary Notes.


 


Pending
the preparation of Notes in definitive form, the Company may execute and the
Trustee shall, upon written request of the Company, authenticate and deliver
temporary Notes (printed or lithographed). 
Temporary Notes shall be issuable in minimum denominations of $1,000 and
integral multiples of $1,000 above that amount in accordance with Section 2.2
of this Indenture, and substantially in the form of the Notes in definitive
form 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 upon the same conditions and in
substantially the same manner, and with the same effect, as the Notes in
definitive form. Without unreasonable delay, the Company will execute and
deliver to the Trustee Notes in definitive form (other than in the case of
Notes in global form) and thereupon any or all temporary Notes (other than any
such Notes in global form) may be surrendered in exchange therefor, at each
office or agency maintained by the Company pursuant to Section 9.2 and the
Trustee shall authenticate and deliver in exchange for such temporary Notes an
equal principal amount of Notes in definitive form.  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 Notes in definitive form authenticated and
delivered hereunder.


 


Section 2.14         Cancellation.


 


All
Notes surrendered for payment, purchase, conversion, registration of transfer
or exchange shall, if surrendered to any Person other than the Trustee, be
delivered to the Trustee.  All Notes so
delivered shall be canceled promptly by the Trustee, 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 procedures for the disposition of cancelled securities in
effect as of the date of such disposition. 
If the Company shall acquire any of the Notes, such acquisition shall
not operate as satisfaction of the Indebtedness represented by such Notes
unless the same are delivered to the Trustee for cancellation.


 


Section 2.15         CUSIP Numbers.


 


The
Company in issuing the Notes may use  “CUSIP”
numbers (if then generally in use), and, if CUSIP numbers are used, then the
Trustee shall use CUSIP numbers in notices as a 


 


22

















 


convenience to Holders; provided that any such notice
shall state that no representation is made as to the correctness of such
numbers either as printed on the Notes or as contained in any such notice and
that reliance may be placed only on the other identification numbers printed on
the Notes.  The Company shall promptly
notify the Trustee of any change in the CUSIP numbers.


 


Section 2.16         Defaulted Interest.


 


If the
Company fails to make a payment of Principal of or Interest on any Note when
due and payable, it shall pay Interest and Additional Interest on such amounts
(to the extent lawful), which shall be calculated using the Interest Rate (such
amounts, the “Defaulted Interest”).  It may elect to pay such Defaulted Interest,
plus any other overdue Interest payable on it, to the Persons who are Holders
on which the Interest is due on a subsequent special record date.  The Company shall notify the Trustee in
writing of the amount of Defaulted Interest the Company proposes to pay on each
such Note. The Company shall fix any such special record date and payment date
for such payment.  At least 15 days
before any such special record date, the Company shall mail to Holders affected
thereby a notice that states the special record date, the payment date and
amount to be paid.


 


Section 2.17         Issuance of Additional Notes.


 


The Company shall be entitled from time to time without the consent of
any Holder, to issue Additional Notes under this Indenture with identical terms
as the Initial Notes issued on the Closing Date other than with respect to (i) the
date of issuance, (ii) the issue price, (iii) the amount of interest
payable on the first interest payment date, and (iv) any changes necessary
to conform to and ensure compliance with the Securities Act (or other
applicable securities laws).  The Initial
Notes issued on the Closing Date and any Additional Notes shall be treated as a
single class for all purposes under this Indenture.


 


With
respect to any Additional Notes, the Company shall set forth in an Officers’
Certificate prepared pursuant to a resolution of the Board of Directors of the
Company, a copy of which shall be delivered to the Trustee, the following
information:


 


(a)           the
aggregate principal amount of such Additional Notes to be authenticated and
delivered pursuant to this Indenture; and


 


(b)           the
issue price, the issue date and the CUSIP number of such Additional Notes; provided, however,
that no Additional Notes may be issued at a price that would cause such Additional
Notes to have “original issue discount” within the meaning of Section 1273
of the Internal Revenue Code of 1986, as amended.


 


ARTICLE 3



DISCHARGE OF INDENTURE


 


Section 3.1            Discharge of Liability on Notes.


 


When (a) the Company delivers to the Trustee
all Outstanding Notes (other than Notes replaced pursuant to Section 2.11)
for cancellation, (b) all Outstanding Notes have become due 


 


23

















 


and payable at their Stated Maturity or all
Outstanding Notes converted and the Company deposits with the Trustee cash and,
in the event of possible conversions pursuant to Article 12, Common Stock,
sufficient to pay all amounts due and owing on, and to satisfy all other
obligations of the Company with respect to, all Outstanding Notes on or before
the Stated Maturity (other than Notes replaced pursuant to Section 2.11)
or (c) when no Notes are Outstanding, and if in any such case the Company
pays all other sums payable hereunder by the Company, then this Indenture
shall, subject to Section 5.8, cease to be of further effect.  The Trustee shall join in the execution of a
document prepared by the Company acknowledging satisfaction and discharge of
this Indenture on demand of the Company accompanied by an Officers’ Certificate
and Opinion of Counsel and at the cost and expense of the Company.


 


Section 3.2            Repayment to the Company.


 


The
Trustee and the Paying Agent shall return to the Company upon written request
any money or securities held by them for the payment of any amount with respect
to the Notes that remains unclaimed for two years, subject to applicable
unclaimed property law.  After return to
the Company, Holders entitled to the money or securities must look to the
Company for payment as general creditors unless an applicable abandoned
property law designates another Person and the Trustee and the Paying Agent
shall have no further liability to the Holders with respect to such money or
securities for that period commencing after the return thereof.


 


ARTICLE 4



DEFAULTS AND REMEDIES


 


Section 4.1            Events of Default.


 


An “Event of Default”, wherever used herein, means any one of
the following events (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):


 


(a)           the
Company fails to convert Notes into shares of its Common Stock and/or cash
consistent with the settlement elections made by the Company pursuant to Section 12.12
or as otherwise may be required pursuant to Section 12.1(b) and such
failure continues for 10 days after written notice of default is given to the
Company by the Trustee or to the Company and the Trustee by the Holder of such
Note;


 


(b)           the
Company defaults in the payment of the Principal amount of any Outstanding Note
(a “Defaulted Payment”) when the
same becomes due and payable at its Stated Maturity, upon exercise of a
Purchase Right or otherwise;


 


(c)           the
Company defaults in the payment of Interest or Additional Interest, if any, on
any Note when it becomes due and payable and such default continues for a
period of 30 days;


 


(d)           the
Company fails to provide notice of the occurrence of a Fundamental Change on a
timely basis;


 


24

















 


(e)           the
Company fails to perform or observe any other term, covenant or agreement
contained in the Notes or this Indenture other than the covenants and
agreements set forth in Section 9.4, and the default continues for a
period of 60 days after written notice of such failure, requiring the Company
to remedy the same, shall have been given to the Company by the Trustee or to
the Company and the Trustee by the Holders of at least 25% in aggregate
principal amount of the Outstanding Notes;


 


(f)            a
default occurs under any Indebtedness for money borrowed by the Company or any
of its Subsidiaries that is a Significant Subsidiary or any group of two or
more Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary, the aggregate outstanding principal amount of which is in an amount
in excess of $5  million, for a
period of 30 days after written notice to the Company by the Trustee or to the
Company and the Trustee by Holders of at least 25% in aggregate principal
amount of the Outstanding Notes, which default (i) is caused by a failure
to pay when due principal or interest on such Indebtedness by the end of the
applicable grace period, if any, unless such Indebtedness is discharged or (ii) results
in the acceleration of such Indebtedness because of a default with respect to
such Indebtedness without such Indebtedness having been discharged or such
non-payment or acceleration having been cured, waived, rescinded or annulled;


 


(g)           any
of the following occurs in respect of the Company or any of its Subsidiaries
that is a Significant Subsidiary or any group of two or more Subsidiaries that,
taken as a whole, would constitute a Significant Subsidiary:  (i) the entry by a court having
jurisdiction in the premises of a decree or order for relief, in an involuntary
case or proceeding under any applicable U.S. federal or state bankruptcy,
insolvency, reorganization or other similar law; or (ii) the entry by a
court having jurisdiction in the premises of a decree or order adjudging such
Person or Persons a bankrupt or insolvent, or approving as properly filed a
petition seeking reorganization, arrangement, adjustment or composition of or
in respect of such Person or Persons under any applicable U.S. federal or state
law, or appointing a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of such Person or Persons or of any
substantial part of its or their property, or ordering the winding up or liquidation
of its or their affairs; or


 


(h)           the
Company or any of its Subsidiaries that is a Significant Subsidiary or any
group of two or more Subsidiaries that, taken as a whole, would constitute a
Significant Subsidiary, takes any of the following actions:  (i) commences  a voluntary case or proceeding under any
applicable U.S. federal or state bankruptcy, insolvency, reorganization or
other similar law; (ii) consents to the entry of a decree or order for
relief in respect of itself in an involuntary case or proceeding under any
applicable U.S. federal or state bankruptcy, insolvency, reorganization or
other similar law or to the commencement of any bankruptcy or insolvency case
or proceeding against it of a petition or answer or consent seeking reorganization
or relief under any applicable U.S. federal or state law in the context of a
bankruptcy, insolvency or reorganization proceeding; (iii) consents to the
filing of a petition described in clause (ii) above or to the appointment
of or the taking possession by a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of such Person or Persons or of
any substantial part of its or their property; (iv) the making of an
assignment for the benefit of creditors; (v) the admission in writing by
such Person or Persons of its inability to pay its debts generally as they 


 


25

















 


become due; or (vi) the taking of corporate
action by such Person or Persons expressly in furtherance of any action
described in clause (i) through (v) above.


 


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


 


Section 4.2            Acceleration of Maturity; Rescission
and Annulment.


 


If an
Event of Default with respect to Outstanding Notes (other than an Event of
Default specified in Section 4.1(g) or 4.1(h) hereof) occurs and
is continuing, the Trustee or the Holders of at least 25% in principal amount
of the Outstanding Notes, by written notice to the Company and the Trustee, may
declare due and payable 100% of the principal amount of all Outstanding Notes,
plus any accrued and unpaid Interest and Additional Interest, if any, to the
date of payment.  Upon a declaration of
acceleration, such Principal amount, and accrued and unpaid Interest and
Additional Interest, if any, to the date of payment shall be immediately due
and payable.


 


If an
Event of Default specified in Section 4.1(g) and 4.1(h) occurs,
the Principal and accrued and unpaid Interest and Additional Interest, if any,
on the Outstanding Notes shall become and be immediately due and payable,
without any declaration or other act on the part of the Trustee or any Holder.


 


The
Holders of not less than a majority of the principal amount of the Outstanding
Notes, may, through notice to the Trustee on behalf of the Holders of all of
the Notes, rescind and annul an acceleration and its consequences (including
waiver of any defaults) if:


 


(a)           all existing Events of Default, other
than the nonpayment of a Defaulted Payment on the Notes which has become due
solely because of the acceleration, have been remedied, cured or waived, and


 


(b)           the rescission would not conflict
with any judgment or decree of a court of competent jurisdiction;


 


provided, however, that in the event such declaration
of acceleration has been made based on the existence of an Event of Default
under Section 4.1(f) and the default with respect to Indebtedness for
money borrowed which gave rise to such Event of Default has been remedied,
cured or waived, then, without any further action by the Holders, such
declaration of acceleration shall be rescinded automatically and the
consequences of such declaration shall be annulled.  No such rescission or annulment shall affect
any subsequent Default or impair any right consequent thereon.


 


The sole remedy of
the Holders for any failure by the Company to comply with the requirements of Section 9.4
shall be the right to receive Additional Interest pursuant to Section 9.4(c) and
the Purchase Rights set forth in Article 11.


 


26
















 


Section 4.3            Other
Remedies.


 


If an
Event of Default with respect to Outstanding Notes occurs and is continuing,
the Trustee may pursue any available remedy by proceeding at law or in equity
to collect the Defaulted Payment or Interest and Additional Interest, if any,
due and payable on the Notes or to enforce the performance of any provision of
the Notes.


 


The
Trustee may maintain a proceeding in which it may prosecute and enforce all
rights of action and claims under this Indenture or the Notes, even if it does
not possess any of the Notes or does not produce any of them in the proceeding.


 


Section 4.4            Waiver of Past Defaults.


 


The
Holders, through the written consent of not less than a majority of the
principal amount of the Outstanding Notes, may, on behalf of the Holders of all
of the Notes, waive an existing Default or Event of Default, except a Default
or Event of Default:


 


(a)           set forth in Sections 4.1(b) and
(c), provided, however, that subject to Section 4.7, the Holders of a
majority of the principal amount of the Outstanding Notes may rescind an
acceleration and its consequences, including any related payment default that
resulted from such acceleration; or


 


(b)           in respect of a covenant or provision
hereof which, under Section 7.2 hereof, cannot be modified or amended
without the consent of the Holders of each Outstanding Note affected.


 


Upon
any such waiver, such Default shall cease to exist, and any Event of Default
arising therefrom shall be deemed to have been cured, for every purpose of this
Indenture; provided, however,
that no such waiver shall extend to any subsequent or other Default or impair
any right consequent thereon.


 


Section 4.5            Control by Majority.


 


The
Holders of a majority of the principal amount of the Outstanding Notes 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.  However,
the Trustee may refuse to follow any direction that:


 


(a)           conflicts with any law or with this
Indenture;


 


(b)           the Trustee determines may be unduly
prejudicial to the rights of the Holders not joining therein; or


 


(c)           may expose the Trustee to personal
liability.


 


The
Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction.


 


27

















 


Section 4.6            Limitation on Suit.


 


No
Holder shall have any right to pursue any remedy with respect to this Indenture
or the Notes (including instituting any proceeding, judicial or otherwise, with
respect to this Indenture or for the appointment of a receiver or trustee)
unless:


 


(a)           such Holder has previously given
written notice to the Trustee of an Event of Default that is continuing;


 


(b)           the Holders of at least 25% of the
principal amount of the Outstanding Notes shall have made written request to
the Trustee to pursue the remedy;


 


(c)           such Holder or Holders have offered
to the Trustee indemnity satisfactory to it against any costs, expenses and liabilities
incurred in complying with such request;


 


(d)           the Trustee has failed to comply with
the request for 60 days after its receipt of such notice, request and offer of
indemnity; and


 


(e)           during such 60-day period, no
direction inconsistent with such written request has been given to the Trustee
by the Holders of a majority of the principal amount of the Outstanding Notes;


 


provided, however, that no one or more of such Holders
may use this Indenture to prejudice the rights of another Holder or to obtain
preference or priority over another Holder.


 


Section 4.7            Unconditional Rights of Holders to
Receive Payment and to Convert.


 


Notwithstanding
any other provision in this Indenture, the Holder of any Note shall have the
right, which is absolute and unconditional, to receive payment of the Principal
of and Interest and Additional Interest, if any, in respect of the Notes held
by such Holder, on or after the respective due dates, to convert the Notes in
accordance with Article 12 or to bring suit for the enforcement of any
such payment on or after such respective dates or the right to convert, and
such rights shall not be impaired or affected adversely without the consent of
such Holder.


 


Section 4.8            Collection of Indebtedness and Suits
for Enforcement by the Trustee.


 


The
Company covenants that if:


 


(a)           a Default or Event of Default is made
in the payment of Interest and Additional Interest, if any, on any Note when
such Interest and Additional Interest, if any, becomes due and payable and such
Default or Event of Default continues for a period of 30 days; or


 


(b)           a Default or Event of Default is made
in the payment of  the Principal on any
Note when the same becomes due and payable at its Stated Maturity, upon
declaration when due for purchase by the Company or otherwise,


 


28

















 


then the Company will, upon demand of the Trustee, pay
to it, for the benefit of the Holders of such Notes, the entire Principal then
due and payable (as expressed therein or as a result of any acceleration
effected pursuant to Section 4.2 hereof) on such Notes for any such
amounts and, to the extent legally enforceable, Interest and Additional
Interest, if any, on such Notes, and, in addition thereto, such further amount
as shall be sufficient to cover the costs and expenses of collection, including
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel.


 


If the
Company fails to pay such amounts forthwith upon such demand, the Trustee, in
its own name and as trustee of an express trust, may institute a judicial
proceeding for the collection of the sums so due and unpaid, may prosecute such
proceeding to judgment or final decree and may enforce the same against the
Company and collect the monies adjudged or decreed to be payable in the manner
provided by law out of the property of the Company, wherever situated.


 


If an
Event of Default occurs and is continuing, the Trustee may in its discretion
proceed to protect and enforce its rights and the rights of the Holders by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any such rights, whether for the specific enforcement of
any covenant or agreement in this Indenture or in aid of the exercise of any
power granted herein, or to enforce any other proper remedy.


 


Section 4.9            Trustee May File Proofs of
Claim.


 


In
case of the pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Company or the property of the Company or its
creditors, the Trustee (irrespective of whether the Principal, Interest and
Additional Interest, if any, shall then be due and payable as therein expressed
or by declaration or otherwise and irrespective of whether the Trustee shall
have made any demand on the Company for the payment of any such amount) shall
be entitled and empowered, by intervention in such proceeding or otherwise:


 


(a)           to file and prove a claim for the whole
amount of the Principal, Interest  and
Additional Interest, if any, owing and unpaid in respect of the Notes and to
file such other papers or documents as may be necessary or advisable in order
to have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel) and of the Holders allowed in such judicial proceeding; and


 


(b)           to collect and receive any monies,
Common Stock or other property payable or deliverable on any such claim and to
distribute the same,


 


and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceedings is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due to it
for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel and any other amounts due the Trustee under Section 5.8.


 


29

















 


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


 


Section 4.10         Restoration of Rights and Remedies.


 


If the
Trustee or any Holder has instituted any proceeding to enforce any right or
remedy under this Indenture and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Trustee or to
such Holder, then and in every such case, subject to any determination in such
proceeding, the Company, the Trustee and the Holders shall be restored
severally and respectively to their former positions hereunder and thereafter
all rights and remedies of the Trustee and the Holders shall continue as though
no such proceeding had been instituted.


 


Section 4.11         Rights and Remedies Cumulative.


 


Except
as otherwise provided with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Notes in the last paragraph of Section 2.11, no
right or remedy conferred in this Indenture upon or reserved to the Trustee or
to the Holders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by applicable law, be
cumulative and in addition to every other right and remedy given hereunder or
hereafter existing at law or in equity or otherwise.  The assertion or employment of any right or
remedy hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.


 


Section 4.12         Delay or Omission Not Waiver.


 


No
delay or omission of the Trustee or of any Holder 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 or by law to the Trustee or to the Holders may be exercised
from time to time, and as often as may be deemed expedient, by the Trustee or
by the Holders, as applicable.


 


Section 4.13         Priorities.


 


Any
money and property collected by the Trustee pursuant to this Article shall
be applied in the following order, at the date or dates fixed by the Trustee:


 


FIRST: to the
payment of all amounts due to the Trustee under Section 5.8;


 


SECOND: to
Holders for amounts due and unpaid on the Notes for the Principal or Interest,
or Additional Interest, if any, as applicable, ratably, without preference or
priority of any kind, according to such amounts due and payable on the Notes
(including, without limitation, amounts due and property deliverable in
relation to conversions of the Notes); and


 


THIRD: any
remaining amounts shall be repaid to the Company.


 


30

















 


The
Trustee may fix a special record date and payment date for any payment to
Holders pursuant to this Section 4.13. 
At least 15 days before such special record date, the Trustee shall mail
to each Holder and the Company a notice that states the special record date,
the payment date and the amount to be paid.


 


Section 4.14         Undertaking for Costs.


 


All
parties to this Indenture agree, and each Holder of any Note by such Holder’s
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,
suffered 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, 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; but the
provisions of this Section shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Holder, or group of Holders, holding in
the aggregate more than 10% of the principal amount of the Outstanding Notes,
or to any suit instituted by any Holder for the enforcement of (i) payments
pursuant to Section 4.7, (ii) Purchase Rights in accordance with Article 11
or (iii) conversion rights in accordance with Article 12.  This Section 4.14 shall be in lieu of Section 315(e) of
the TIA and such Section 315(e) is hereby expressly excluded from
this Indenture, as permitted by the TIA.


 


Section 4.15         Waiver of Stay or Extension Laws.


 


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


 


Section 4.16         Payment for Consent, Waiver or
Amendment.


 


The
Company shall not, and shall not permit any of its Subsidiaries to, directly or
indirectly, pay or cause to be paid any consideration to or for the benefit of
any Holder of Notes for or as an inducement to any consent, waiver or amendment
of any of their terms or provisions of this Indenture or the Notes unless such
consideration is offered to be paid and is paid to all Holders of the Notes
that consent, waiver or agree to amend in the time frame set forth in the
solicitation documents relating to such consent, waiver or agreement.


 


31

















 


ARTICLE 5


 


THE TRUSTEE


 


Section 5.1            Certain Duties and Responsibilities.


 


(a)           Except
during the continuance of an Event of Default,


 


(i)            The Trustee
undertakes to perform such duties and only such duties as are specifically set
forth in this Indenture or the TIA, and no implied covenants or obligations
shall be read into this Indenture against the Trustee; and


 


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


 


(b)           In
case an Event of Default actually known to a Responsible Officer of the Trustee
has occurred and is continuing, the Trustee shall exercise such of the rights
and powers vested in it by this Indenture, and use the same degree of care and
skill in their exercise, as a prudent person would exercise or use under the
circumstances in the conduct of such person’s own affairs.


 


(c)           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:


 


(i)            This paragraph (c) shall
not be construed to limit the effect of paragraph (a) of this Section 5.1;


 


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


 


(iii)          The Trustee shall
not be liable with respect to any action taken or omitted to be taken by it in
good faith in accordance with a direction received by it of the Holders of a
majority of the principal amount of the Outstanding Notes 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.


 


32

















 


(d)           Whether
or not herein expressly so 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 5.1.


 


(e)           No
provision of this Indenture shall require the Trustee to expend or risk its own
funds or otherwise incur any liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers.  The Trustee may refuse to perform any duty or
exercise any right or power unless it receives indemnity reasonably
satisfactory to it against any loss, liability, cost or expense (including,
without limitation, reasonable fees and expenses of counsel).


 


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


 


(g)           The
Trustee shall not be deemed to have notice or actual knowledge of any 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 a Default is
received by the Trustee pursuant to Section 14.2 hereof, and such notice
references the Notes and this Indenture.


 


(h)           The
rights, privileges, protections, immunities and benefits given to the Trustee
hereunder, including, without limitation, its right to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and each Paying Agent, authenticating agent, Conversion Agent or
Registrar acting hereunder.


 


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


 


Section 5.2            Certain Rights of Trustee.


 


Subject
to the provisions of Section 5.1 hereof and subject to Section 315(a) through
(d) of the TIA:


 


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


 


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


 


33

















 


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


 


(d)           The
Trustee shall not be liable for any action taken or omitted to be taken by it
in good faith that it believed to be authorized or within the discretion or
rights or powers conferred upon it by this Indenture, unless the Trustee’s
conduct constitutes negligence.


 


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


 


(f)            Unless
otherwise specifically provided in this Indenture, any demand, request,
direction or notice from the Company shall be sufficient if signed by an
Officer of the Company.


 


(g)           The
permissive rights of the Trustee to do things enumerated in this Indenture
shall not be construed as a duty unless so specified herein.


 


Section 5.3            Individual Rights of Trustee.


 


The
Trustee in its individual or any other capacity may become the owner or pledgee
of Notes and may otherwise deal with the Company or any Affiliate of the
Company with the same rights it would have if it were not Trustee.  However, in the event that the Trustee
acquires any conflicting interest (as such term is defined in Section 310(b) of
the TIA), it must eliminate such conflict within 90 days, apply to the
Commission for permission to continue as trustee (to the extent permitted under
Section 310(b) of the TIA) or resign. 
Any agent may do the same with like rights and duties.  The Trustee is also subject to Sections 5.11
and 5.12 hereof.


 


Section 5.4            Money Held in Trust.


 


Money
held by the Trustee in trust hereunder shall 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 otherwise expressly agreed with the Company.


 


Section 5.5            Trustee’s Disclaimer.


 


The
recitals contained herein and in the Notes (except for those in the certificate
of authentication) shall be taken as the statements of the Company, and the
Trustee assumes no responsibility for their correctness.  The Trustee makes no representation as to the
validity or adequacy of this Indenture or the Notes.  The Trustee shall not be accountable for the
use or application by the Company of the Notes or the proceeds thereof.


 


Section 5.6            Notice of Defaults.


 


Within
90 days after a Responsible Officer of the Trustee has received written notice
of the occurrence of any Default or Event of Default hereunder, the Trustee
shall give notice to Holders, unless such Default or Event of Default shall
have been cured or waived; provided,
however, that, except in the case of a Default or Event of Default
described in Sections 4.1(b) or 


 


34

















 


(c),
the Trustee shall be protected in withholding such notice if and so long as
Responsible Officers of the Trustee in good faith determine that the
withholding of such notice is in the interest of the Holders.  This Section 5.6 shall be in lieu of the
proviso to Section 315(b) of the TIA and such proviso is hereby
expressly excluded from this Indenture, as permitted by the TIA.


 


Section 5.7            Reports by Trustee to Holders.


 


Within
60 days after each May 31st, beginning with the May 31st
following the date of this Indenture, the Trustee shall transmit to Holders
such reports concerning the Trustee and its actions under this Indenture as may
be required by Section 313 of the TIA and in the manner provided by the
TIA.


 


A copy
of each report at the time of its mailing to Holders shall be filed with the
Commission, if required, and each stock exchange, if any, on which the Notes
and the Common Stock are listed.  The
Company shall promptly notify the Trustee when the Notes or the Common Stock
become listed on any stock exchange.


 


Section 5.8            Compensation and Indemnification.


 


The
Company covenants and agrees to pay to the Trustee from time to time, and the
Trustee shall be entitled to, such compensation as agreed to in writing by the
Trustee and the Company (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
covenants and agrees to pay or reimburse the Trustee upon its request for all
expenses, disbursements and advances incurred or made by or on behalf of it in
accordance with any of the provisions of this Indenture (including the
reasonable compensation and the expenses and disbursements of its counsel and
of all agents and other persons not regularly in its employ), except to the
extent that any such expense, disbursement or advance is due to its negligence
or bad faith.  When the Trustee incurs
expenses or renders services in connection with an Event of Default specified
in Section 4.1, the expenses (including the charges and expenses of its
counsel) and the compensation for the services are intended to constitute
expenses of administration under any bankruptcy law.  The Company also covenants to indemnify the
Trustee and its officers, directors, employees and agents for, and to hold such
Persons harmless against, any loss, liability or expense incurred by them,
arising out of or in connection with the acceptance or administration of this
Indenture or the trusts hereunder or the performance of their duties hereunder,
including the reasonable costs and expenses of defending themselves against or
investigating any claim of liability in the premises, except to the extent that
any such loss, liability or expense was due to the negligence or willful
misconduct of such Persons.  The
obligations of the Company under this Section 5.8 to compensate and
indemnify the Trustee and its officers, directors, employees and agents and to
pay or reimburse such Persons for expenses, disbursements and advances shall
constitute additional Indebtedness hereunder and shall survive the satisfaction
and discharge of this Indenture or the earlier resignation or removal of the
Trustee.  Such additional Indebtedness
shall be a lien prior to that of the Notes upon all property and funds held or
collected by the Trustee as such, except such money or property held in trust
for the benefit of the Holders of particular Notes, and the Notes are hereby
subordinated to such senior claim.  “Trustee” for purposes of this Section 5.8
shall include any predecessor Trustee, in its capacity as Trustee, but the
negligence or willful misconduct of any Trustee shall not affect the
indemnification of any other Trustee.


 


35

















 


Section 5.9            Replacement of Trustee.


 


A resignation
or removal of the Trustee and appointment of a successor Trustee shall become
effective only upon the successor Trustee’s acceptance of appointment as
provided in this Section 5.9.


 


The
Trustee may resign and be discharged from the trust hereby created by so
notifying the Company in writing.  The
Holders of at least a majority of the principal amount of Outstanding Notes may
remove the Trustee by so notifying the Trustee and the Company in writing.  The Company must remove the Trustee if:


 


(a)           the Trustee fails to comply with Section 5.11
hereof or Section 310 of the TIA;


 


(b)           the Trustee becomes incapable of
acting;


 


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


 


(d)           a Custodian or public officer takes
charge of the Trustee or its property.


 


If the
Trustee resigns or is removed or if a vacancy exists in the office of the
Trustee for any reason, the Company shall promptly appoint a successor Trustee.  The Trustee shall be entitled to payment of
its fees and reimbursement of its expenses while acting as Trustee.


 


Any
Holder may petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor Trustee if the Trustee fails to
comply with Section 5.11.


 


If an
instrument of acceptance by a successor Trustee shall not have been delivered
to the Trustee within 30 days after the giving of such notice of resignation or
removal, the resigning or removed Trustee, as applicable, may petition, at the
expense of the Company, any court of competent jurisdiction for the appointment
of a successor Trustee.


 


A
successor Trustee shall deliver a written acceptance of its appointment to the
retiring Trustee and to the Company.  Thereupon
the resignation or removal of the retiring Trustee shall become effective, and
the successor Trustee shall have all the rights, powers and duties of the
Trustee under this Indenture.  The
Company shall issue a notice of the successor Trustee’s succession to the
Holders.  Upon payment of its charges,
the retiring Trustee shall promptly transfer all property held by it as Trustee
to the successor Trustee, subject nevertheless to its lien, if any, provided
for in Section 5.8 hereof. 
Notwithstanding replacement of the Trustee pursuant to this Section 5.9
hereof, the Company’s obligations under Section 5.8 hereof shall continue
for the benefit of the retiring Trustee with respect to expenses, losses and
liabilities incurred by it prior to such replacement.


 


36
















 


Section 5.10         Successor Trustee by Merger, Etc.


 


Subject
to Section 5.11 hereof, if the Trustee consolidates with, merges or
converts into, or transfers all or substantially all of its corporate trust
business to, another corporation or national banking association, the successor
entity without any further act shall be the successor Trustee as to the Notes.


 


Section 5.11         Corporate Trustee Required;
Eligibility.


 


The
Trustee shall at all times satisfy the requirements of Section 310(a)(1), (2) and
(5) of the TIA.  The Trustee shall
at all times have (or, in the case of a corporation included in a bank holding
company system, the related bank holding company shall at all times have), a
combined capital and surplus of at least $50 million as set forth in its (or
its related bank holding company’s) most recent published annual report of
condition.  The Trustee is subject to Section 310(b) of
the TIA.


 


Section 5.12         Collection of Claims Against the
Company.


 


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


 


ARTICLE 6


 


CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER, 

SALE, LEASE OR OTHER DISPOSITION


 


Section 6.1            Company May Consolidate, Etc.,
Only on Certain Terms.


 


The
Company shall not consolidate with or merge into any other Person or convey,
transfer, sell, lease or otherwise dispose of all or substantially all of the
properties and assets of the Company and its Subsidiaries taken as a whole, to
any Person, unless:


 


(a)           the resulting, surviving or
transferee Person is organized and validly existing under the laws of the
United States of America, any State thereof or the District of Columbia;


 


(b)           such surviving or transferee entity
shall expressly assume, by an indenture supplemental hereto, executed and
delivered to the Trustee, in form reasonably satisfactory to the Trustee, the
due and punctual payment of all and any amounts when due on all the Notes and
the performance of every covenant of this Indenture and the Notes on the part
of the Company to be performed or observed and shall have provided for
conversion rights provided in Article 12;


 


(c)           immediately after giving effect to
such transaction, no Default or Event of Default shall have occurred and be
continuing; and


 


37

















 


(d)           The Company shall have delivered to
the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating
that such consolidation, merger or transfer and such supplemental indenture, if
any, comply with this Indenture.


 


This Section 6.1
will not apply to a merger of the Company with an Affiliate solely for the
purpose of reincorporating the Company in another jurisdiction.


 


Section 6.2            Successor Corporation Substituted.


 


Upon
any consolidation or merger by the Company with or into any other Person or any
conveyance, transfer, sale, lease or other disposition of all or substantially
all of the properties and assets of the Company to any Person, in accordance
with Section 6.1 hereof, the successor Person formed by such consolidation
or into which the Company is merged or to which such conveyance, transfer,
sale, lease or disposition is made shall succeed to, and be substituted for,
and may exercise every right and power of, the Company under this Indenture
with the same effect as if such successor Person had been named as the Company
herein.  In the event of any such
conveyance, transfer, sale or disposition to the Company (which term shall for
this purpose mean the Person named as the “Company” in the first paragraph of
this Indenture or any successor Person which shall theretofore become such in
the manner described in Section 6.1 hereof), except in the case of a lease
to another Person, the predecessor Person shall be relieved of all obligations
and covenants under this Indenture and the Notes and may be dissolved and
liquidated.


 


ARTICLE 7



AMENDMENTS, SUPPLEMENTS AND WAIVERS


 


Section 7.1            Without Consent of Holders of Notes.


 


Without
the consent of any Holders, the Company, when authorized by a Board Resolution,
and the Trustee, at any time and from time to time, may amend this Indenture
and the Notes to:


 


(a)           add to the covenants of the Company
for the benefit of the Holders;


 


(b)           surrender any right or power herein
conferred upon the Company;


 


(c)           provide for conversion rights of
Holders if any reclassification or change of the Company’s Common Stock or any
consolidation, merger or sale of all or substantially all of the Company’s
assets occurs;


 


(d)           provide for the assumption of the
Company’s obligations to the Holders in the case of a merger, consolidation or
conveyance, sale, transfer or lease pursuant to Article 6 hereof;


 


(e)           reduce the Conversion Price or
increasing the Conversion Rate; provided, however, that such reduction in the
Conversion Price or increase in the Conversion Rate 


 


38

















 


shall not
adversely affect the interest of the Holders (after taking into account tax and
other consequences of such reduction or increase);


 


(f)            comply with the requirements of the
Commission in order to effect or maintain the qualification of this Indenture
under the TIA;


 


(g)           cure any ambiguity or correct or
supplement any provision herein which may be inconsistent with any other
provision herein or which is otherwise defective; provided, however, that such action pursuant to this clause (g) does
not, in the good faith opinion of the Board of Directors (as evidenced by a
Board Resolution) and the Trustee, adversely affect the interests of the
Holders in any material respect;


 


(h)           add guarantees with respect to the
Notes;


 


(i)            to provide for the issuance of
Additional Notes in accordance with the limitations set forth in this Indenture
as of the date hereof; or


 


(j)            add or modify any other provisions
herein with respect to matters or questions arising hereunder which the Company
and the Trustee may deem necessary or desirable and which will not adversely
affect the interests of the Holders in any material respect.


 


Section 7.2            With Consent of Holders of Notes.


 


Except
as provided below in this Section 7.2, this Indenture or the Notes may be
amended, modified or supplemented, and noncompliance in any particular instance
with any provision of this Indenture or the Notes may be waived, with the
written consent of the Holders of at least a majority of the principal amount
of the Outstanding Notes.


 


Without
the written consent or the affirmative vote of each Holder of Notes affected
thereby, an amendment or waiver under this Section 7.2 may not:


 


(a)           change the Stated Maturity of the
Principal of or the date any installment of Interest or Additional Interest, if
any, is due on any Note;


 


(b)           reduce the Principal, Repurchase
Price or Interest or Additional Interest, if any, on any Note;


 


(c)           change the place of payment or the
currency of any amount owed or owing under the Note from U.S. Dollars;


 


(d)           alter the manner of calculation or
rate of accrual of Interest or Additional Interest, if any, on any Note or
extend the payment of any such amount;


 


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


 


39

















 


(f)            except as otherwise permitted or
contemplated by the Indenture, adversely affect the right of the Holders to
convert any Note as provided in Article 12;


 


(g)           modify the provisions of Article 11
in a manner adverse to the Holders or to provide for redemption of the Notes;


 


(h)           reduce the percentage of the
principal amount of the Outstanding Notes the consent of whose Holders is
required for any supplemental indenture or the consent of whose Holders is
required for any waiver provided for in this Indenture; or


 


(i)            modify any of the provisions of this
Section, except to provide that certain other provisions of this Indenture
cannot be modified or waived without the consent of the Holder of each
Outstanding Note affected thereby.


 


It
shall not be necessary for any Act of Holders under this Section 7.2 to
approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such Act shall approve the substance thereof.


 


Section 7.3            Compliance with Trust Indenture Act.


 


Every
amendment to this Indenture or the Notes shall be set forth in a supplemental
indenture that complies with the TIA as then in effect.


 


Section 7.4            Revocation of Consents and Effect of
Consents or Votes.


 


Until
an amendment, supplement or waiver becomes effective, a written consent to it
by a Holder is a continuing consent by the Holder and every subsequent Holder
of a Note or portion of a Note that evidences the same debt as the consenting
Holder’s Note, even if notation of the consent is not made on any Note; provided, however, that unless a
record date shall have been established, any such Holder or subsequent Holder
may revoke the consent as to its Note or portion of a Note if the Trustee
receives written notice of revocation before the date the amendment, supplement
or waiver becomes effective.


 


An
amendment, supplement or waiver becomes effective on receipt by the Trustee of
written consents from or affirmative votes by, as applicable, the Holders of
the requisite percentage of the principal amount of the Outstanding Notes, and
thereafter shall bind every Holder; provided,
however, if the amendment, supplement or waiver makes a change described
in any of the clauses (a) through (i) of Section 7.2, the
amendment, supplement or waiver shall bind only each Holder which has consented
to it or voted for it, as applicable, and every subsequent Holder of a Note or
portion of a Note that evidences the same Indebtedness as the Note of the
consenting or affirmatively voting Holder, as applicable.


 


Section 7.5            Notation on or Exchange of Notes.


 


If an
amendment, supplement or waiver changes the terms of a Note:


 


(a)           the Trustee may require the Holder of
a Note to deliver such Notes to the Trustee, the Trustee may place an
appropriate notation on the Note about the changed 


 


40

















 


terms and
return it to the Holder and the Trustee may place an appropriate notation on
any Note thereafter authenticated; or


 


(b)           if the Company or the Trustee so
determines, the Company in exchange for the Note shall issue and the Trustee
shall authenticate a new Note that reflects the changed terms.


 


Failure to make the appropriate notation or issue a
new Note shall not affect the validity and effect of such amendment, supplement
or waiver.


 


Section 7.6            Trustee to Sign Amendment, Etc.


 


The
Trustee shall sign any amendment authorized pursuant to this Article 7 if
the Trustee reasonably determines the amendment does not adversely affect the
rights, duties, liabilities or immunities of the Trustee.  If the Trustee reasonably determines the
amendment does adversely affect the rights, duties, liabilities or immunities
of the Trustee, the Trustee may but need not sign it.  In signing or refusing to sign any amendment
hereunder, the Trustee shall be entitled to receive and shall be fully
protected in relying upon an Officers’ Certificate and an Opinion of Counsel as
conclusive evidence that such amendment is authorized or permitted by this
Indenture and that all conditions precedent relating thereto have been complied
with.


 


Section 7.7            Effect of Amendment.


 


Upon
the execution of any supplemental amendment under this Article, this Indenture
shall be modified in accordance therewith, and such amendment shall form a part
of this Indenture for all purposes; and, except as otherwise provided herein,
every Holder of a Note theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.


 


ARTICLE 8



[INTENTIONALLY OMITTED]


 


ARTICLE 9



COVENANTS


 


Section 9.1            Payment of Principal, Repurchase
Price and Interest.


 


The
Company will duly and punctually pay the Principal of and the Interest and
Additional Interest, if any, on, and any other payments due with respect to,
the Notes when and if at any time any such foregoing amounts are due and
payable in accordance with the terms of the Notes and this Indenture.  The Company will deposit or cause to be
deposited with the Trustee as directed by the Trustee, no later than the day of
the Stated Maturity, the date of any installment of Interest and Additional
Interest, if any, or any other date such payment is otherwise due, the amount
necessary to pay the amounts due.  If
Additional Interest is payable by the Company, the Company shall deliver to the
Trustee a certificate to such effect stating (i) the amount of 


 


41

















 


Additional Interest so payable and (ii) the date
on which such Additional Interest is payable. 
Unless and until a Responsible Officer of the Trustee receives such a
certificate, the Trustee may assume without inquiry that no Additional Interest
is payable.


 


Section 9.2            Maintenance of Offices or Agencies.


 


The
Company hereby appoints the Trustee’s Corporate Trust Office as its office or
agency in the Borough of Manhattan, The City of New York, where Notes may be:


 


(a)           presented or surrendered for payment;


 


(b)           surrendered for registration of
transfer or exchange; and


 


(c)           surrendered for conversion;


 


and where notices and demands to or upon the Company
in respect of the Notes and this Indenture may be served.


 


The
Company will maintain an office or agency where Notes may be presented or
surrendered for payment, where Notes may be surrendered for registration of
transfer or exchange, where Notes may be surrendered for conversion and where
notices and demands to or upon the Company in respect of the Notes and this
Indenture may be served.  The Company
will give prompt written notice to the Trustee, and notice to the Holders in
accordance with Section 14.2 hereof, of the appointment or termination of
any such agents and of the location and any change in the location of any such
office or agency.


 


If at
any time the Company shall fail to maintain any such required office or agency
or shall fail to furnish the Trustee with the address thereof, presentations
and surrenders may be made at, and notices and demands may be served on, the
Corporate Trust Office of the Trustee.


 


Section 9.3            Corporate Existence.


 


Subject
to Article 6 hereof, the Company will do or cause to be done all things
necessary to preserve and keep in full force and effect its corporate
existence, rights (charter and statutory) and franchises of the Company and
each Subsidiary; provided, however, that the Company shall not be required to
preserve any such right or franchise if the Board of Directors shall determine
in good faith that the preservation thereof is no longer desirable in the
conduct of the business of the Company and its Subsidiaries as a whole and that
the loss thereof is not disadvantageous in any material respect to the Holders.


 


Section 9.4            Reports.


 


(a)           The Company shall deliver to the
Trustee within 15 days after the Company is required to file them with the
Commission (including any applicable extensions of time to file) copies of
Forms 10-K and 10-Q which the Company is required to file with the Commission
pursuant to Section 13 or 15(d) of the Exchange Act; provided, however, the Company shall
not be required to deliver to the Trustee any materials for which the Company
has sought and received confidential treatment by the Commission.


 


42

















 


(b)           In the event the Company is at any
time no longer subject to the reporting requirements of Section 13 or 15(d) of
the Exchange Act, it shall continue to provide the Trustee and shall provide
the Holders with reports containing substantially the same information as would
have been required to be filed with the Commission had the Company continued to
have been subject to such reporting requirements.  In such event, such reports shall be provided
at the times the Company would have been required to provide reports had it
continued to have been subject to such reporting requirements.  The Company also shall comply with the other
provisions of Section 314(a) of the TIA.


 


(c)           Notwithstanding the foregoing, the
Company may deliver the reports required by Sections 9.4(a) and (b) up
to 180 days after the Required Delivery Date provided that the Company pays
Additional Interest on the Notes until the first date on which the reports
required by Section 9.4(a) or (b) have been delivered as
follows:


 


(i)            at
a per annum rate of 0.25% in excess of the rate otherwise payable for each day
from and after the 90th day after the Required Delivery Date to but
excluding the 120th day after the Required Delivery Date; and


 


(ii)           at
a per annum rate of 0.50% in excess of the rate otherwise payable for each day
from and after the 120th day after the Required Delivery Date to but
excluding the 180th day after the Required Delivery Date.


 


(d)           When any Additional Interest is
payable, the Company shall deliver to the Trustee on each Interest Payment Date
on which Additional Interest has accrued, an Officers’ Certificate specifying
the Additional Interest which has accrued and which is then owing pursuant to Section 9.4(c).


 


(e)           If the Company has not delivered the
reports required by Sections 9.4(a) and (b) by the 180th
day after the Required Delivery Date, then the Holders shall have the Purchase
Rights set forth in Article 11.


 


Section 9.5            Compliance Certificate.


 


The
Company shall deliver to the Trustee, within 120 days after the end of each
fiscal year of the Company, an Officers’ Certificate signed by two Officers of
the Company stating that, in the course of the performance by the signers of
their duties as Officers of the Company, they would normally have knowledge of
any failure by the Company to comply with all conditions, or Default by the
Company with respect to any covenants, under this Indenture, and further
stating whether or not they have knowledge of any such failure or Default and,
if so, specifying each such failure or Default and the nature thereof.  In the event an Officer of the Company comes
to have actual knowledge of a Default, regardless of the date, the Company
shall deliver an Officers’ Certificate to the Trustee within five Business Days
of obtaining such actual knowledge specifying such Default and the nature and
status thereof.


 


43

















 


ARTICLE 10



[INTENTIONALLY OMITTED]


 


ARTICLE 11



PURCHASE AT THE OPTION OF A HOLDER


 


Section 11.1         Purchase Right.


 


(a)           If (i) a
Fundamental Change occurs, or (ii) a Financial Statement Delivery Default
occurs, in each case at any time prior to the Stated Maturity, the Notes not
previously converted or  purchased by the
Company shall be purchased by the Company for cash, at the option of the Holder
thereof upon exercise of its rights under this Article 11 (“Purchase Rights”), at a repurchase price equal to 100% of the Principal amount of the
Notes being repurchased, plus accrued and unpaid Interest and Additional
Interest, if any, to, but not including, the Purchase Date (the “Put Purchase Price”).  The “Purchase Date”
shall be:  (x) in the case of a
Fundamental Change, a date that is between 30 and 60 days after the date of a
notice of Fundamental Change delivered by the Company pursuant to Section 11.1(b),
and (y) in the case of a Financial Statement Delivery Default, a date that
is between 30 and 60 days after the date of a notice of the Financial Statement
Delivery Default described in Section 11.1(b), in each case subject to
satisfaction by or on behalf of the Holder of the requirements set forth in Section 11.1(c).


 


(b)           No
later than 30 days after the occurrence of a Fundamental Change and no later
than 10 days after the occurrence of a Financial Statement Delivery Default,
the Company shall mail a written notice of a Fundamental Change or Financial
Statement Delivery Default, as the case may be, detailing the Purchase Rights
by first class mail to the Trustee and to each Holder (and to beneficial owners
as required by applicable law).  The
notice shall include a form of notice Purchase Notice to be completed by the
Holder and shall state:


 


(i)            in the case of a
Fundamental Change, briefly, the events causing a Fundamental Change and the
date of such Fundamental Change;


 


(ii)           in the case of a
Financial Statement Delivery Default, that such default has occurred and the
date of such default;


 


(iii)          the date by which
the Purchase Notice pursuant to this Section 11.1 must be delivered to the
Paying Agent in order for a Holder to exercise the Purchase Rights;


 


(iv)          the Purchase Date;


 


(v)           the Put Purchase
Price;


 


44

















 


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


 


(vii)         the Conversion Price
and any adjustments thereto and, in the case of a Fundamental Change, whether
Notes surrendered for conversion within 30 days of the notice of the
Fundamental Change will be settled in cash, shares of Common Stock or a
combination of cash and shares of Common Stock;


 


(viii)        in the case of a
Fundamental Change, the date by which Holders must convert their Notes in order
to receive any Additional Common Stock or additional cash payment pursuant to Section 12.1(b);


 


(ix)           that the Notes as to
which a Purchase Notice has been given may be converted only if the Purchase
Notice has been withdrawn in accordance with the terms of this Indenture;


 


(x)            that the Notes must
be surrendered to the Paying Agent to collect payment;


 


(xi)           that the Put Purchase
Price for any Note as to which a Purchase Notice has been duly given and not
withdrawn will be paid promptly following the later of the Purchase Date and
the time of surrender of such Note as described in clause (ix) above;


 


(xii)          briefly, the
procedures the Holder must follow to exercise rights under this Section 11.1;


 


(xiii)         briefly, the
conversion rights of the Notes;


 


(xiv)        the procedures for
withdrawing a Purchase Notice;


 


(xv)         that, unless the
Company defaults in making payment of such Put Purchase Price, interest on
Notes surrendered for purchase by the Company will cease to accrue on and after
the Purchase Date; and


 


(xvi)        the CUSIP number(s) of
the Notes.


 


Without
otherwise limiting the Company’s obligations pursuant to this Section 11.1
in any way, the Company shall also issue a press release through Dow Jones &
Company, Inc. containing the relevant information and otherwise make this
information available on the Company’s web site or through another public
medium as the Company may use at that time.


 


(c)           A
Holder may exercise its rights specified in Section 11.1(a) upon
delivery of a written notice of purchase (a “Purchase
Notice”) to the Paying Agent at any time on or prior to the close of
business on the second Business Day preceding the Purchase Date (unless the
Company shall specify a later date), specifying:


 


45

















 


(i)            the certificate
number of the Note, if certificated, which the Holder will deliver to be
purchased or, if not certificated, the notice must comply with the appropriate
depositary procedures;


 


(ii)           the portion of the
principal amount of the Note to be purchased, which portion must be $1,000 or
an integral multiple of $1,000; and


 


(iii)          that such Note
shall be purchased pursuant to the terms and conditions specified in this
Indenture and the Notes.


 


The
delivery of such Note with the Purchase Notice (together with all necessary
endorsements) to the Paying Agent at the offices of the Paying Agent shall be a
condition to the receipt by the Holder of the Put Purchase Price therefor;
provided, however, that such Put Purchase Price shall be so paid pursuant to
this Section 11.1 and Section 11.2 only if the Note so delivered to
the Paying Agent shall conform in all respects to the description thereof set
forth in the related Purchase Notice.


 


The
Company shall purchase from the Holder thereof, pursuant to this Section 11.1
and Section 11.2, a portion of a Note if the principal amount of such
portion is $1,000 or an integral multiple of $1,000.  Provisions of this Indenture that apply to
the purchase of all of a Note also apply to the purchase of such portion of
such Note.


 


Any
purchase by the Company contemplated pursuant to the provisions of this Section 11.1
and Section 11.2 shall be consummated by the delivery to the Conversion
Agent and/or the Paying Agent of the consideration to be received by the
Holder.


 


Notwithstanding
anything herein to the contrary, any Holder delivering to the Paying Agent the
Purchase Notice contemplated by this Section 11.1(c) shall have the
right to withdraw such Purchase Notice, in whole or in part, at any time prior
to the close of business on the Purchase Date by delivery of a written notice
of withdrawal to the Paying Agent in accordance with Section 11.2.


 


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


 


All
Notes purchased by the Company pursuant to this Section 11.1 shall be
canceled by the Trustee.


 


Upon
completion of any repurchase pursuant to this Article 11, the aggregate
principal amount of the Global Notes shall be decreased by adjustments made on
the records of the Trustee, as custodian, and of the Depositary or its nominee,
to reflect the reduction in the outstanding Principal following such
repurchase.


 


Section 11.2         Effect of Purchase Notice; Withdrawal.


 


Upon
receipt by the Paying Agent of the Purchase Notice specified in Section 11.1,
the Holder of the Note in respect of which such Purchase Notice was given shall
(unless such Purchase Notice is withdrawn as specified in the following two
paragraphs) thereafter be entitled 


 


46

















 


to
receive solely the Put Purchase Price with respect to such Note.  Such Put Purchase Price shall be paid to such
Holder, subject to the receipt of funds by the Paying Agent, promptly following
the later of (x) the Purchase Date (provided the conditions in Section 11.1(c) have
been satisfied) and (y) the time of delivery of such Note to the Paying
Agent by the Holder thereof in the manner required by Section 11.1(c).  Notes in respect of which a Purchase Notice
has been given by the Holder thereof may not be converted pursuant to Article 12
hereof on or after the date of the delivery of such Purchase Notice unless such
Purchase Notice has first been validly withdrawn as specified in the following
paragraph.


 


A
Purchase Notice may be withdrawn by means of a written notice of withdrawal
delivered to the office of the Paying Agent in accordance with the Purchase
Notice, at any time prior to the close of business on the Purchase Date,
specifying:


 


(i)            the principal amount of the Note
with respect to which such notice of withdrawal is being submitted;


 


(ii)           the certificate number, if any, of
the Note in respect of which such notice of withdrawal is being submitted, or,
if not certificated, the notice must comply with the appropriate depositary
procedures; and


 


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


 


Section 11.3         Deposit of Put Purchase Price.


 


Prior
to 10:00 a.m., New York City time, on the Business Day following the
Purchase Date, the Company shall deposit with the Trustee or with the Paying
Agent (or, if the Company or a Subsidiary or an Affiliate of either of them is
acting as the Paying Agent, shall segregate and hold in trust as provided in Section 2.6)
an amount of cash (in immediately available funds if deposited on such Business
Day) sufficient to pay the aggregate Put Purchase Price of all the Notes or
portions thereof which are to be purchased as of the Purchase Date.


 


Section 11.4         Notes Purchased in Part.


 


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


 


Section 11.5         Covenant to Comply With Securities Laws
Upon Purchase of Notes.


 


When
complying with the provisions of Section 11.1 (provided that such offer or
purchase constitutes an “issuer tender offer” for purposes of Rule 13e-4
(which term, as used 


 


47

















 


herein,
includes any successor provision thereto) under the Exchange Act at the time of
such offer or purchase), and subject to any exemptions available under
applicable law, the Company shall (i) comply with Rule 13e-4 and Rule 14e-1 (or any
successor provision) under the Exchange Act, (ii) file the related
Schedule TO (or any successor schedule, form or report) under the Exchange Act,
and (iii) otherwise comply with all federal and state securities laws so
as to permit the rights and obligations under Section 11.1 to be exercised
in the time and in the manner specified in Section 11.1.


 


Section 11.6         Repayment to the Company.


 


The
Trustee and the Paying Agent shall return to the Company any cash that remains
unclaimed as provided in Section 22 of the Notes, together with interest
or dividends, if any, thereon (subject to the provisions of Section 5.4),
held by them for the payment of the Put Purchase Price; provided, however, that
to the extent that the aggregate amount of cash deposited by the Company
pursuant to Section 11.3 exceeds the aggregate Put Purchase Price of the
Notes or portions thereof which the Company is obligated to purchase as of the
Purchase Date, then, unless otherwise agreed in writing with the Company, on
the Business Day following the Purchase Date, the Trustee shall return any such
excess to the Company together with interest thereon (subject to the provisions
of Section 5.4).


 


ARTICLE 12



CONVERSION OF NOTES


 


Section 12.1         Conversion Right; Expiration of
Conversion Right; Conversion Price.


 


(a)           Subject
to and upon compliance with the provisions of this Article, at the option of
the Holder at any time and from time to time prior to the close of business on
the Business Day preceding the Stated Maturity, any Note or any portion of the
principal amount thereof which is an integral multiple of $1,000 may be
converted at the principal amount thereof, or of such portion thereof, into
duly authorized, fully paid and nonassessable shares of Common Stock (or, at
our election pursuant to Section 12.12, cash or a combination of cash and
shares of Common Stock), at the Conversion Price, determined as hereinafter
provided, in effect at the time of conversion. 
The price at which shares of Common Stock shall be delivered upon
conversion (the “Conversion Price”)
shall be initially equal to $4.74 per share of Common Stock, subject to
adjustment, in certain instances, as provided in this Section 12.1 and in Section 12.4.


 


(b)           Subject
to Section 12.1(b)(ii), Section 12.1(c), and Section 12.5, if a
Holder elects to convert a Note within 30 days after notice is given with respect
to a Fundamental Change of the type specified in connection clauses (a) or
(c) of the definition of Fundamental Change (or in connection with a
transaction that would have been a Fundamental Change under such clause (a) or
(c) of the definition of Fundamental Change but for the existence of the
120% Trading Price Exception), the Company will increase the number of shares
of Common Stock issuable upon conversion of the Note by a number of additional
shares of Common Stock (the “Additional
Common Stock”) as set forth below. 
Subject to Section 12.1(c), the number of shares of Additional
Common Stock will be determined by reference to the table below, based on the
date 


 


48

















 


on which such Fundamental Change becomes effective
(the “Effective Date”) and the
price (the “Stock Price”) paid per
share for the Common Stock in such Fundamental Change.  If Holders of Common Stock receive only cash
in such Fundamental Change, the Stock Price shall be the cash amount paid per
share.  Otherwise, the Stock Price shall
be the average of the Market Prices of the Common Stock on the five Trading
Days prior to but not including the Effective Date of such Fundamental Change.


 


The
Stock Prices and number of shares of Additional Common Stock set forth in the
table below will be adjusted as of any date on which the Conversion Price is
adjusted.  On such date, the Stock Prices
shall be adjusted by multiplying:


 


(i)            the Stock Prices applicable
immediately prior to such adjustment, by


 


(ii)           a fraction, of which


 


(A)                              the
numerator shall be the Conversion Price as so adjusted, and


 


(B)                                the
denominator shall be the Conversion Price immediately prior to the adjustment
giving rise to the Stock Price adjustment.


 


On such date, the number of shares of Additional
Common Stock shall be adjusted by multiplying:


 


(i)                                     the
Additional Common Stock applicable immediately prior to such adjustment, by


 


(ii)                                  a
fraction, of which


 


(A)                              the
numerator shall be the Conversion Price immediately prior to the adjustment
giving rise to the Stock Price adjustment, and


 


(B)                                the
denominator shall be the Conversion Price as so adjusted.


 


49
















 


The
following table sets forth the Stock Price and number of shares of Additional
Common Stock issuable per $1,000 aggregate principal amount of Notes:


 


	
   

  	
   

  	
  Stock Price

  	
   

  
	
  Effective Date

  	
   

  	
  $3.95

  	
   

  	
  $4.00

  	
   

  	
  $4.50

  	
   

  	
  $5.00

  	
   

  	
  $5.50

  	
   

  	
  $6.00

  	
   

  	
  $7.00

  	
   

  
	
  August 1, 2008

  	
   

  	
  42.19

  	
   

  	
  42.19

  	
   

  	
  42.19

  	
   

  	
  37.73

  	
   

  	
  30.82

  	
   

  	
  25.36

  	
   

  	
  17.43

  	
   

  
	
  August 1, 2009

  	
   

  	
  42.19

  	
   

  	
  42.19

  	
   

  	
  42.19

  	
   

  	
  37.96

  	
   

  	
  30.78

  	
   

  	
  25.15

  	
   

  	
  17.07

  	
   

  
	
  August 1, 2010

  	
   

  	
  42.19

  	
   

  	
  42.19

  	
   

  	
  42.19

  	
   

  	
  37.05

  	
   

  	
  29.62

  	
   

  	
  23.88

  	
   

  	
  15.78

  	
   

  
	
  August 1, 2011

  	
   

  	
  42.19

  	
   

  	
  42.19

  	
   

  	
  42.19

  	
   

  	
  34.17

  	
   

  	
  26.54

  	
   

  	
  20.79

  	
   

  	
  12.98

  	
   

  
	
  August 1, 2012

  	
   

  	
  42.19

  	
   

  	
  42.19

  	
   

  	
  37.12

  	
   

  	
  26.31

  	
   

  	
  18.78

  	
   

  	
  13.49

  	
   

  	
  7.02

  	
   

  
	
  August 1, 2013

  	
   

  	
  41.85

  	
   

  	
  38.70

  	
   

  	
  11.59

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  



 


	
   

  	
   

  	
  Stock Price

  	
   

  
	
  Effective Date

  	
   

  	
  $8.00

  	
   

  	
  $9.00

  	
   

  	
  $10.00

  	
   

  	
  $11.00

  	
   

  	
  $12.00

  	
   

  	
  $13.00

  	
   

  	
  $14.00

  	
   

  	
  $15.00

  	
   

  
	
  August 1, 2008

  	
   

  	
  12.10

  	
   

  	
  8.40

  	
   

  	
  5.76

  	
   

  	
  3.85

  	
   

  	
  2.46

  	
   

  	
  1.46

  	
   

  	
  0.75

  	
   

  	
  0.00

  	
   

  
	
  August 1, 2009

  	
   

  	
  11.71

  	
   

  	
  8.03

  	
   

  	
  5.44

  	
   

  	
  3.59

  	
   

  	
  2.25

  	
   

  	
  1.30

  	
   

  	
  0.65

  	
   

  	
  0.00

  	
   

  
	
  August 1, 2010

  	
   

  	
  10.54

  	
   

  	
  7.03

  	
   

  	
  4.61

  	
   

  	
  2.92

  	
   

  	
  1.73

  	
   

  	
  0.91

  	
   

  	
  0.38

  	
   

  	
  0.00

  	
   

  
	
  August 1, 2011

  	
   

  	
  8.18

  	
   

  	
  5.11

  	
   

  	
  3.09

  	
   

  	
  1.75

  	
   

  	
  0.87

  	
   

  	
  0.33

  	
   

  	
  0.05

  	
   

  	
  0.00

  	
   

  
	
  August 1, 2012

  	
   

  	
  3.61

  	
   

  	
  1.75

  	
   

  	
  0.71

  	
   

  	
  0.18

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  
	
  August 1, 2013

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  



 


If the
Stock Price and Effective Date are not set forth on the table above and the
Stock Price is:


 


(I)                                    between
two Stock Prices on the table or the Effective Date is between two dates on the
table, the number of shares of Additional Common Stock will be determined by
straight-line interpolation between the number of shares of Additional Common
Stock set forth for the higher and lower Stock Price and the two Effective
Dates, as applicable, based on a 360-day year;


 


(II)                                in
excess of $15.00 per share (subject to adjustment), no shares of Additional
Common Stock will be issued upon conversion; or


 


(III)                            less
than $3.95 per share (subject to adjustment), no shares of Additional Common
Stock will be issued upon conversion.


 


(c)                                  Notwithstanding
any other provision of this Indenture to the contrary including the option of
the Company to satisfy its conversion obligations with cash as described in Section 12.12,
in no event shall the number of shares of Common Stock issuable upon conversion
for each $1,000 principal amount of Notes, taking into account all Additional
Common Stock required to be issued with respect thereto, exceed 253 shares of
Common Stock (with the effect that the number of shares of Common Stock
issuable upon conversion of any Note shall not exceed the number of shares of
Common Stock that could have been purchased for the corresponding principal
amount of such Note based on the closing bid price of the Common Stock
immediately prior to entering into the Exchange Agreement); provided, however,
that if any adjustment is made to the Conversion Price pursuant to Section 12.4(b),
then the number of 


 


50

















 


shares of Common Stock in the
foregoing clause shall be adjusted as follows: 
253 shares of Common Stock multiplied by the Conversion Rate immediately
after any adjustment made by reason of Section 12.4(b) divided by the
Conversion Rate immediately prior to any such adjustment made by reason of Section 12.4(b).  If successive adjustments are made pursuant
to Section 12.4(b), successive adjustments shall be made pursuant to the
preceding sentence.


 


Subject
to this Section 12.1(c), the Company may, at its election, issue the
Additional Common Stock upon the conversion of Notes within 30 days after
notice is given with respect to a Fundamental Change or make an additional cash
payment in lieu thereof in an amount equal to the product of the Additional
Common Stock otherwise issuable multiplied by the average of Applicable Stock
Prices for the 20 Trading Days following the Conversion Date, or a combination
of cash and Additional Common Stock, with the cash payment being determined on
the basis described in the preceding clause with respect to any Additional
Common Stock that is not delivered; provided, however, that if the number of
shares of Additional Common Stock issuable in relation to a Fundamental Change
would result in the Company issuing shares of Additional Common Stock in an
amount resulting in the total number of shares of Common Stock issuable upon
conversion of the Notes exceeding 19.99% of the Common Stock outstanding at the
time of the initial issuance of the Notes at a time when such conversion
limitation set forth in Section 12.15(c) is in effect, then the
Company shall be deemed to have elected to pay cash in respect of those shares
of Additional Common Stock as a result of which we would otherwise exceed the
19.99% threshold, which cash payment shall be made on the same basis as the
other cash payments pursuant to this paragraph.


 


Section 12.2                            Exercise of
Conversion Right.


 


(a)                                  To
exercise the conversion right with respect to a Physical Note, a Holder must (1) complete
a conversion notice, the form of which is provided in Exhibit C, to
the Depositary stating that the Holder elects to convert such Physical Note or,
if less than the entire principal amount thereof is to be converted, the
portion thereof to be converted, (2) deliver a duly signed completed
conversion notice and the Physical Note duly endorsed or assigned to the
Company or in blank, at the office of any Conversion Agent, (3) pay all
Interest to which the Holder is not entitled, if any, pursuant to Section 2.1(e) and
(4) pay any transfer taxes or other applicable taxes or duties, if
required.


 


(b)                                 To
the extent provided in Section 2.1(e), Notes surrendered for conversion
during the period from the close of business on any Regular Record Date to the
opening of business on the next succeeding Interest Payment Date shall be
accompanied by payment by such Holder in immediately available funds to the
Company of an amount equal to the Interest to be received on such Interest
Payment Date on principal amount of Notes being surrendered for conversion.


 


(c)                                  Notes
shall be deemed to have been converted immediately prior to the close of
business on the day of surrender of such Notes for conversion and completion of
the other conversion requirements in accordance with the foregoing provisions,
and at such time the rights of the Holders of such Notes as Holders shall
cease, and the Person or Persons entitled to receive the shares of Common Stock
issuable (or, at our election pursuant to Section 12.12, cash or a
combination of cash and shares of Common Stock), upon conversion shall be
treated for all purposes as the record holder or holders of any such shares of
Common Stock at such time.


 


51

















 


(d)                                 In
the case of any Note which is converted in part only, or a Holder converts less
than the principal amount it owns at such time, upon such conversion 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 unconverted portion
of the principal amount of such Note.


 


(e)                                  Subject
to Section 12.12, as promptly as practicable on or after the Conversion
Date, the Company shall cause to be issued and delivered to such Conversion
Agent a certificate or certificates for the number of full shares of Common
Stock issuable upon conversion of such Notes, together with payment in lieu of
any fraction of a share as provided in Section 12.3 hereof.  The Company hereby initially appoints the
Trustee as the Conversion Agent.


 


(f)                                    A
Note in respect of which a Holder has delivered a Purchase Notice exercising
the option of such Holder to require the Company to purchase such Note may be
converted only if such notice of exercise is withdrawn in accordance with Section 11.2.


 


(g)                                 A
Holder of Notes is not entitled to any rights of a holder of Common Stock until
such Holder has converted its Notes to Common Stock, and only to the extent
such Notes are deemed to have been converted into Common Stock pursuant to this
Article 12.


 


Section 12.3                            Fractions of
Shares.


 


No
fractional shares of Common Stock shall be issued upon conversion of any Note
or Notes.  If more than one Note shall be
surrendered for conversion at one time by the same Holder, the number of full
shares of Common Stock which shall be issued upon conversion thereof shall be
computed on the basis of the principal amount of the Notes (or specified
portions thereof) so surrendered. 
Instead of any fractional shares of Common Stock which would otherwise
be issued upon conversion of any Note or Notes (or specified portions thereof),
the Company shall pay a cash adjustment in respect of such fraction (calculated
to the nearest 1/100th of a share) in an amount equal to the same fraction of
the Market Price of the shares of Common Stock as of the Trading Day preceding
the Conversion Date.


 


Section 12.4                            Adjustment
of Conversion Price.


 


The
Conversion Price shall be subject to adjustment, calculated in good faith by
the Company, from time to time as follows:


 


(a)                                  In
case the Company shall hereafter pay a dividend or make a distribution to all
or substantially all holders of the outstanding Common Stock in shares of
Common Stock, the Conversion Price in effect at the opening of business on the
date following the date fixed for the determination of stockholders entitled to
receive such dividend or other distribution shall be reduced by multiplying
such Conversion Price by a fraction:


 


(i)                                     the
numerator of which shall be the number of shares of Common Stock outstanding at
the close of business on the Conversion Record Date fixed for such
determination; and


 


52

















 


(ii)                                  the
denominator of which shall be the sum of such number of shares and the total
number of shares constituting such dividend or other distribution.


 


Such
reduction shall become effective immediately after the opening of business on
the day following the Conversion Record Date. 
If any dividend or distribution of the type described in this Section 12.4(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 or reclassified
into a greater number of shares of Common Stock, the Conversion Price in effect
at the opening of business on the day following the day upon which such
subdivision or reclassification becomes effective shall be proportionately
reduced, and conversely, in case outstanding shares of Common Stock shall be
combined or reclassified into a smaller number of shares of Common Stock, the
Conversion Price in effect at the opening of business on the day following the
day upon which such combination or reclassification becomes effective shall be
proportionately increased.


 


Such
reduction or increase, as applicable, shall become effective immediately after
the opening of business on the day following the day upon which such
subdivision or combination or reclassification becomes effective.


 


(c)                                  In
case the Company shall issue rights or warrants (other than any rights or
warrants issued pursuant to a rights plan referred to in Section 12.4(d))
to all or substantially all holders of its outstanding shares of Common Stock
entitling them to subscribe for or purchase shares of Common Stock (or
securities convertible into shares of Common Stock) at a price per share (or having
a conversion price per share) less than the Current Market Price on the
Conversion Record Date fixed for the determination of stockholders 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 Conversion Record
Date by a fraction:


 


(i)                                     the
numerator of which shall be the number of shares of Common Stock outstanding at
the close of business on the Conversion Record Date, plus the number of shares
which the aggregate offering price of the total number of shares so offered for
subscription or purchase (or the aggregate conversion price of the convertible
securities so offered) would purchase at such Current Market Price; and


 


(ii)                                  the
denominator of which shall be the number of shares of Common Stock outstanding
on the close of business on the Conversion Record Date, plus the total number
of additional shares of Common Stock so offered for subscription or purchase
(or into which the convertible securities so offered are convertible).


 


53

















 


Such adjustment
shall become effective immediately after the opening of business on the day
following the Conversion Record Date fixed for determination of stockholders
entitled to receive such rights or warrants. 
To the extent that shares of Common Stock (or securities convertible
into Common Stock) are not delivered pursuant to such rights or warrants, upon
the expiration or termination of such rights or warrants, the Conversion Price
shall be readjusted to the Conversion Price which would then be in effect had
the adjustments made upon the issuance of such rights or warrants been made on
the basis of the delivery of only the number of shares of Common Stock (or
securities convertible into Common Stock) actually delivered.  In the event that such rights or warrants are
not so issued, the Conversion Price shall again be adjusted to be the
Conversion Price which would then be in effect if such date fixed for the
determination of stockholders entitled to receive such rights or warrants had
not been fixed.  In determining whether
any rights or warrants entitle the Holders to subscribe for or purchase 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 or warrants, the value of
such consideration if other than cash, to be determined 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 12.4(a) applies)
or evidences of its Indebtedness, cash or other assets, including securities,
but excluding:


 


(i)                                     any
rights or warrants referred to in Section 12.4(c);


 


(ii)                                  dividends
or distributions of stock, securities or other property or assets (including
cash) in connection with a reclassification, change, merger, consolidation,
statutory share exchange, combination, sale or conveyance to which Section 12.5
applies;


 


(iii)                               dividends
and distributions paid exclusively in cash; and


 


(iv)                              distributions
of Common Stock referred to in Section 12.4(a) (such Capital Stock,
evidence of its Indebtedness, cash, other assets or securities being
distributed hereinafter in this Section 12.4(d) called the “distributed
assets”),


 


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 Conversion Record Date with respect to such distribution by a fraction:


 


(i)                                     the
numerator of which shall be the Current Market Price on such date, less the
Fair Market Value (as determined by the Board of Directors, whose good faith
determination shall be conclusive and set forth in a Board Resolution) on such
date of the portion of the distributed assets so distributed applicable to one
share of Common Stock (determined on the basis of the number of shares of
Common Stock outstanding on the Conversion Record Date); and


 


(i)                                     the denominator of
which shall be such Current Market Price on such Conversion Record Date.


 


54

















 


Such reduction shall become effective immediately
prior to the opening of business on the day following the Conversion Record
Date.  However, in the event that the
then Fair Market Value (as so determined) of the portion of the distributed
assets so distributed applicable to one share of Common Stock is equal to or
greater than the Current Market Price on the Conversion 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 distributed assets such Holder would have received had
such Holder converted such Note (or portion thereof) immediately prior to such
Conversion 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.


 


If the
Board of Directors determines the Fair Market Value of any distribution for
purposes of this Section 12.4(d) by reference to the actual or when
issued trading market for any distributed assets 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 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 Holders.


 


Rights
or warrants distributed by the Company to all holders of Common Stock entitling
the holders thereof to subscribe for or purchase shares of the Company’s
Capital Stock (either initially or under certain circumstances), which rights
or warrants, until the occurrence of a specified event or events specified in
such rights or warrants or related instruments or agreements governing the same
(a “Trigger Event”):


 


(A)                              are
deemed to be transferred with such shares of Common Stock;


 


(B)                                are
not exercisable; and


 


(C)                                are
also issued in respect of future issuances of Common Stock;


 


shall be deemed not to have been distributed for
purposes of this Section 12.4(d) (and no adjustment to the Conversion
Price under this Section 12.4(d) will be required) until the
occurrence of the earliest Trigger Event. 
If such right or warrant is subject to subsequent events, upon the
occurrence of which such right or warrant shall become exercisable to purchase
different distributed assets, shares of Capital Stock, evidences of
Indebtedness or other assets or entitle 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 the Conversion Record Date with respect
to a new right 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 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 12.4(d):


 


55

















 


(i)                                     in
the case of any such rights or warrants which shall all have been redeemed or
purchased without exercise by any Holders thereof, the Conversion Price shall
be readjusted upon such final redemption or purchase to give effect to such
distribution or Trigger Event, as applicable, as though it were a cash
distribution, equal to the per share redemption or purchase price received by a
holder of Common Stock with respect to such rights or warrants (assuming such
holder had retained such rights or warrants), made to all holders of Common
Stock as of the date of such redemption or purchase; and


 


(ii)                                  in
the case of such rights or warrants which shall have expired or been terminated
without exercise, the Conversion Price shall be readjusted as if such rights
and warrants had never been issued.


 


For
purposes of this Section 12.4(d) and Sections 12.4(a), 12.4(b) and
12.4(c), any dividend or distribution to which this Section 12.4(d) is
applicable that also includes shares of Common Stock, a subdivision or
combination of Common Stock to which Section 12.4(b) applies, or
rights or warrants to subscribe for or purchase shares of Common Stock to which
Section 12.4(c) applies (or any combination thereof), shall be deemed
instead to be:


 


(1)                                  a
dividend or distribution of the evidences of Indebtedness, assets, shares of
Capital Stock, rights or warrants, other than such shares of Common Stock, such
subdivision or combination or such rights or warrants to which Sections
12.4(a), 12.4(b) and 12.4(c) apply, respectively (and any Conversion
Price reduction required by this Section 12.4(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, such subdivision or
combination or such rights or warrants (and any further Conversion Price
reduction required by Sections 12.4(a), 12.4(b) and 12.4(c) with
respect to such dividend or distribution shall then be made), except:


 


(A)                              the
Conversion Record Date of such dividend or distribution shall be substituted as
(x) “the date fixed for the determination of stockholders entitled to
receive such dividend or other distribution”, “Conversion Record Date fixed for
such determinations” and “Conversion Record Date” within the meaning of Section 12.4(a),
(y) “the day upon which such subdivision becomes effective” and “the day
upon which such combination becomes effective” within the meaning of Section 12.4(b),
and (z) as “the date fixed for the determination of stockholders entitled
to receive such rights or warrants”, “the Conversion Record Date fixed for the
determination of the stockholders entitled to receive such rights or warrants”
and such “Conversion Record Date” within the meaning of Section 12.4(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 12.4(a) and any 


 


56

















 


reduction or increase in the
number of shares of Common Stock resulting from such subdivision or combination
shall be disregarded in connection with such dividend or distribution.


 


In the
event of any distribution referred to in Section 12.4(c) or 12.4(d),
the Company will be required to give notice to the Holders at least 20 days
prior to the Ex-Dividend Time for the distribution.  No adjustment to the Conversion Price or the
ability of a Holder to convert will be made if the Holder will otherwise
participate in such distribution without conversion.


 


(e)                                  In
case the Company shall, by dividend or otherwise, make a distribution to all or
substantially all holders of its Common Stock consisting exclusively of cash,
other than any dividend or distribution made in connection with the
liquidation, dissolution or winding-up of the Company, whether voluntary or
involuntary, then, in such case, unless the Company elects to reserve such cash
for distribution to the Holders of the Notes upon the 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 of cash which such Holder would have received if such Holder had,
immediately prior to the record date for such distribution of cash, converted
its Notes into Common Stock, the Conversion Price shall be adjusted so that the
same shall equal the rate determined by multiplying the Conversion Price in
effect immediately prior to the close of business on such Conversion Record
Date by a fraction of which the numerator shall be such Current Market Price of
the Common Stock on the record date less the amount of cash so distributed (and
not excluded as provided above) applicable to one share of Common Stock and the
denominator of which shall be the Current Market Price of the Common Stock on
such Conversion Record Date; such adjustment to be effective immediately prior
to the opening of business on the Business Day following the record date;
provided, however, that in the event the portion of the cash so distributed
applicable to one share of Common Stock is equal to or greater than the Current
Market Price of the Common Stock on the Conversion Record Date, in lieu of the
foregoing adjustment, adequate provision shall be made so that each Holder of a
Note shall have the right to receive upon conversion the amount of cash such
Holder would have received had such Holder converted each Note on the
Conversion Record Date.  If such dividend
or distribution is not so paid or made, the Conversion Price shall again be
adjusted to be the Conversion Price that would then be in effect if such
dividend or distribution had not been declared.


 


(f)                                    In
case a tender or exchange offer made by the Company or any Subsidiary for all
or any portion of the Common Stock shall expire and such tender or exchange
offer (as amended upon the expiration thereof) shall require the payment to
stockholders of consideration per share of Common Stock having a Fair Market
Value (as determined by the Board of Directors, whose good faith determination
shall be conclusive and described in a resolution of the Board of Directors)
that as of the last time (the “Expiration
Time”) tenders or exchanges may be made pursuant to such tender or
exchange offer (as it may be amended) exceeds the Current Market Price of a
share of Common Stock on the Trading Day next succeeding the Expiration Time,
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 Expiration Time by a fraction,


 


57

















 


(i)                                     the
numerator of which shall be the number of shares of Common Stock Outstanding
(including any tendered or exchanged shares) at the Expiration Time multiplied
by the Current Market Price of a share of Common Stock on the Trading Day next
succeeding the Expiration Time; and


 


(ii)                                  the
denominator of which shall be the sum of (x) the Fair Market Value
(determined as aforesaid) of the aggregate consideration payable to
stockholders based on the acceptance (up to any maximum specified in the terms
of the tender or exchange offer) of all shares validly tendered or exchanged
and not withdrawn as of the Expiration Time (the shares deemed so accepted, up
to 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) at the
Expiration Time and the Current Market Price of a share of Common Stock on the
Trading Day next succeeding the Expiration Time.


 


Such
reduction (if any) shall become effective immediately after the opening of
business on the day following the Expiration Time.  If the Company is obligated to purchase
shares pursuant to any such tender or exchange offer, but the Company is
permanently prevented by applicable law from effecting any such purchases or
all such purchases are rescinded, the Conversion Price shall again be adjusted
to be the Conversion Price that would then be in effect if such tender or
exchange offer had not been made.


 


For
purposes of any computation under this Section 12.4(f), if the “ex” date
for any event (other than the tender offer requiring such computation) that
requires an adjustment to the Conversion Price pursuant to Section 12.4(a),
(b), (c), (d), (e) or (f) occurs on the Trading Day next succeeding
the Expiration Time for the tender or exchange offer requiring such
computation, the Current Market Price for such Trading Day shall be adjusted by
multiplying such Current Market Price by the reciprocal of the fraction by
which the Conversion Price is so required to be multiplied as a result of such
other event. If the application of this Section 12.4(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 12.4(f).


 


(g)                                 For
purposes of this Section 12.4, the following terms shall have the meanings
indicated:


 


“Current Market Price” shall mean the
average of the daily Market Prices per share of Common Stock (or such other
security as specified herein) for the 10 consecutive Trading Days immediately
prior to the date in question; provided,
however, that if:


 


(A)                              the “ex”
date (as hereinafter defined) for any event (other than the issuance or
distribution requiring such computation) that requires an adjustment to the
Conversion Price pursuant to Section 12.4(a), (b), (c), (d), (e) or (f) occurs
during such 10 consecutive Trading Days, the Market Price for each Trading Day
prior to the “ex” date for such other event shall be adjusted by multiplying
such Market Price by the same fraction by which the Conversion Price is so
required to be adjusted as a result of such other event;


 


58

















 


(B)                                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 12.4(a),
(b), (c), (d), (e) or (f) occurs on or after the “ex” date for the
issuance or distribution requiring such computation and prior to the day in
question, the Market Price for each Trading Day on and after the “ex” date for
such other event shall be adjusted by multiplying such Market 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


 


(C)                                the
“ex” date for the issuance or distribution requiring such computation is prior
to the day in question, after taking into account any adjustment required
pursuant to clause (A) or (B) of this proviso, the Market 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 by the Board of
Directors in a manner consistent with any determination of such value for
purposes of Section 12.4(d) or (f), whose determination shall be
conclusive and set forth in a Board Resolution) of the evidences of
Indebtedness, shares of Capital Stock or assets being distributed applicable to
one share of Common Stock as of the close of business on the day before such “ex”
date.


 


For
purposes of any computation under Section 12.4(f), the Current Market
Price of the Common Stock on any date shall be deemed to be the average of the
daily Market Prices per share of Common Stock for such day and the next two
succeeding Trading Days; provided, however, that  if the “ex” date for any event (other than the tender offer
requiring such computation) that requires an adjustment to the Conversion Price
pursuant to Section 12.4(a), (b), (c), (d), (e) or (f) occurs on
or after the Expiration Time for the tender or exchange offer requiring such
computation and prior to the day in question, the Market Price for each Trading
Day on and after the “ex” date for such other event shall be adjusted by
multiplying such Market 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.  For purposes of this paragraph,
the term “ex” date, when used:


 


(1)                                  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 Market Price was obtained without the right to receive
such issuance or distribution;


 


(2)                                  with
respect to any subdivision or combination of shares of Common Stock, means the
first date on which the shares of Common Stock trade regular way on such
exchange or in such market after the time at which such subdivision or
combination becomes effective; and


 


(3)                                  with
respect to any tender or exchange offer, means the first date on which the
Common Stock trades regular way on such exchange or in such market after the
Expiration Time of such offer.


 


Notwithstanding
the foregoing, whenever successive adjustments to the Conversion Price are
called for pursuant to this Section 12.4, such adjustments shall be made
to the Current Market Price as may be necessary or appropriate to effectuate
the intent of this Section 12.4 and to avoid unjust or inequitable results
as determined in good faith by the Board of Directors.


 


59
















 


The
Company may make such reductions in the Conversion Price, in addition to those
required by Sections 12.4(a), (b), (c), (d), (e) or (f), as the Board of
Directors considers to be advisable to avoid or diminish any income tax to
holders of Common Stock or rights to purchase Common Stock resulting from any
dividend or distribution of stock (or rights to acquire stock) or from any
event treated as such for income tax purposes or otherwise.


 


(h)           No
adjustment need be made for (i) a transaction referred to in Sections 12.4
or 12.5 if Holders participate in the transaction without conversion on a basis
and with notice that the Board of Directors determines to be fair and
appropriate in light of the basis and notice on which holders of shares of
Common Stock participate in the transaction; (ii) the issuance and
distribution of rights to purchase shares of Common Stock pursuant to (A) a
Company plan for reinvestment of dividends or interest, (B) a change in
the par value or no par value of the shares of Common Stock or (C) to the
extent the Notes become convertible pursuant to this Article 12 in whole
or in part into cash, with respect to such cash after such cash is distributed
to the Holders in satisfaction of such conversion right.


 


(i)            Subject
to Section 12.1(c), to the extent permitted by applicable law, the Company
from time to time may reduce the Conversion Price by any amount for any period
of time if the period is at least 20 days and the reduction is irrevocable
during the period and the Board of Directors determines in good faith that such
reduction would be in the best interests of the Holders, which determination
shall be conclusive and set forth in a Board Resolution; provided, however, the Board of Directors may
not exercise such right to reduce the Conversion Price in such a manner that
will violate Nasdaq Marketplace Rule 4350(i) or any similar or
successor rule as then in effect. 
Whenever the Conversion Price is reduced pursuant to the preceding
sentence, the Company shall mail to the Trustee and the Conversion Agent a
notice of the reduction at least 15 days prior to the date the reduced
Conversion Price takes effect, and such notice shall state the reduced
Conversion Price and the period during which it will be in effect.


 


(j)            No
adjustment in the Conversion Price shall be required unless such adjustment
would require an increase or decrease of at least 1% in such Conversion Price; provided, however, that any
adjustments which by reason of this Section 12.4(k) are not required
to be made shall be carried forward and taken into account in any subsequent
adjustment, regardless of whether the aggregate adjustment is less than 1%,
annually on the anniversary of the first date of original issuance of Notes or
if a Fundamental Change occurs.  All
calculations under this Article 12 shall be made by the Company in good
faith and shall be made to the nearest cent or to the nearest one hundredth of
a share, as applicable.


 


(k)           No
adjustment in Conversion Price shall be required if the Fair Market Value of
any assets, debt securities or rights, warrants or options to purchase the
securities of the Company, including but not limited to Common Stock, in each
case applicable to each share of Common Stock are distributed to the Company’s
stockholders and such Fair Market Value either equals or exceeds the Current
Market Price or such Current Market Price exceeds the such Fair Market Price
Value by an amount not exceeding $1.00; provided, however, that in lieu of the
adjustment foregone which by reason of this Section 12.4(l), adequate provision shall be made so that each
Holder shall have the right to receive upon conversion of a Note, in addition
to shares of Common Stock, the kind and amount of such distribution such Holder
would have received 


 


60

















 


had such Holder converted
such Note immediately prior to the Record Date for determining the shareholders
entitled to receive the distribution.


 


(l)            In
any case in which this Section 12.4 shall require that any adjustment be
made effective as of or retroactively immediately following a Conversion Record
Date, the Company may elect to defer (but only for five Trading Days following
the filing of the statement referred to in Section 12.6) issuing to the
Holder of any Notes converted after such Conversion Record Date the shares of
Common Stock issuable upon such conversion over and above the shares of Common
Stock issuable upon such conversion on the basis of the Conversion Price prior
to adjustment; provided, however, that the Company shall deliver to such Holder
a due bill or other appropriate instrument evidencing such Holder’s right to
receive such additional shares upon the occurrence of the event requiring such
adjustment.


 


(m)          For
purposes of this Section 12.4, 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.


 


(n)           If
the distribution date for the rights provided in the Company’s rights agreement
occurs prior to the date a Note is converted, the Holder of the Note who
converts such Note after the distribution date is not entitled to receive the
rights that would otherwise be attached (but for the date of conversion) to the
shares of Common Stock received upon such conversion; provided, however, that an adjustment shall be made to the
Conversion Price pursuant to Section 12.4(d) as if the rights were
being distributed to the common stockholders of the Company immediately prior
to such conversion.  If such an
adjustment is made and the rights are later redeemed, invalidated or
terminated, then a corresponding reversing adjustment shall be made to the
Conversion Price, on an equitable basis, to take account of such event.


 


(o)           In
case the Company shall, by dividend or otherwise, distribute to all holders of
its Common Stock shares of any class of Capital Stock of a Subsidiary, then 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 Conversion Record Date with respect to such
distribution by a fraction:


 


(i)            the numerator of
which shall be the Current Market Price less the Fair Market Value of the
shares of Capital Stock of such Subsidiary (as determined by the Board of
Directors, whose good faith determination shall be conclusive and set forth in
a Board Resolution) distributed per share of Common Stock, measured from the
date of such distribution; and


 


(ii)           the denominator of
which shall be the Current Market Price of the Company’s Common Stock, measured
from the date of such distribution.


 


Section 12.5         Consolidation or Merger of the Company.


 


If any
of the following events occurs, namely:


 


61

















 


(a)           any reclassification or change of the
outstanding 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) as a result of which holders of Common Stock shall
be entitled to receive Capital Stock, securities or other property or assets
(including cash) with respect to or in exchange for such Common Stock;


 


(b)           any merger, consolidation, statutory
share exchange 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 or any combination thereof) with
respect to or in exchange for such Common Stock; or


 


(c)           any sale or conveyance of all or
substantially all of the properties and assets of the Company 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 or any
combination thereof) with respect to or in exchange for such Common Stock,


 


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 Notes shall be convertible into the kind and
amount of shares of stock and other securities or property or assets (including
cash) which such Holder would have been entitled to receive upon such
reclassification, change, merger, consolidation, statutory share exchange,
combination, sale or conveyance had such Notes been converted into Common Stock
immediately prior to such reclassification, change, merger, consolidation,
statutory share exchange, combination, sale or conveyance.  For purposes of the foregoing, if holders of
Common Stock have the option to receive more than a single type of
consideration (determined based in part upon any form of stockholder election),
the type and amount of consideration that a Holder would have been entitled to
receive will be deemed to be the weighted average of the types and amounts of
consideration received by the holders of Common Stock that affirmatively make
such an election.  Such supplemental
indenture shall provide for adjustments that shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Article 12.  If, in the case of any such reclassification,
change, merger, consolidation, statutory share exchange, combination, sale or
conveyance, the stock or other securities and assets receivable thereupon by a
holder of Common Stock includes 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, merger, consolidation, statutory share
exchange, combination, 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 as the Board of Directors
shall reasonably consider necessary by reason of the foregoing, including to
the extent practicable the provisions providing for the Purchase Rights set
forth in Article 11 hereof.  The Company
covenants that it will not become a party to any such transaction unless its
terms are consistent with the foregoing and that the Company will not become a
party to any transaction unless any securities issuable to Holders upon
conversion of Notes are freely transferable or will be freely transferable
following completion of registration by the issuer thereof.


 


62

















 


The
Company shall cause notice of the execution of such supplemental indenture to
be mailed to each Holder, at the address of such Holder as it appears on the
register of the Notes maintained by the Registrar, within 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 12.5 shall similarly apply to successive
reclassifications, mergers, consolidations, statutory share exchanges,
combinations, sales and conveyances.  If
this Section 12.5 applies to any event or occurrence, Section 12.4
shall not apply.


 


Any
Additional Common Stock which a Holder is entitled to receive upon conversion
pursuant to Section 12.1(b), if applicable, shall not be payable in shares
of Common Stock, but will represent a right to receive the aggregate amount of
cash, securities or other property into which the Additional Common Stock would
convert as a result of such recapitalization, consolidation, merger, share
transfer, acquisition or share exchange.


 


Section 12.6         Notice of Adjustments of Conversion Price.


 


Whenever
the Conversion Price is adjusted as herein provided, the Company shall promptly
file with the Trustee and any Conversion Agent other than the Trustee an
Officers’ Certificate setting forth the adjusted Conversion Price and showing
in reasonable detail the facts upon which such adjustment is based.  Promptly after delivery of such Officers’
Certificate, the Company shall prepare a notice or press release stating that
the Conversion Price has been adjusted and setting forth the adjusted Conversion
Price and the date on which each adjustment becomes effective, shall issue such
notice or press release through Dow Jones & Company, Inc.,
Business Wire or Bloomberg Business News (or, if such organizations are not in
existence at the time of issuance of such press release, such other news or
press organization as is reasonably calculated to broadly disseminate the
relevant information to the public) and shall make the information available on
the Company’s website or through another public medium as the Company may use
at such time.  Failure to deliver such
notice shall not affect the legality or validity of any such adjustment.


 


Section 12.7         Notice Prior to Certain Actions.


 


In
case at any time after the date hereof:


 


(a)           the Company shall become party to a
consolidation or merger for which approval of any stockholders of the Company
is required, or enters into the sale or conveyance to another Person or entity
or group of Persons or entities acting in concert as a partnership, limited
partnership, syndicate or other group (within the meaning of Rule 13d-3
under the Exchange Act) of all or substantially all of the property and assets
of the Company;


 


(b)           the Company shall declare a dividend
(or any other distribution) on its Common Stock payable otherwise than in cash
out of its capital surplus or its consolidated retained earnings;


 


63

















 


(c)           the Company shall authorize the
granting to the holders of its Common Stock of rights or warrants to subscribe
for or purchase any shares of Capital Stock of any class (or of securities
convertible into shares of Capital Stock of any class) or of any other rights;


 


(d)           there shall occur any
reclassification of the Common Stock of the Company (other than a subdivision
or combination of its outstanding Common Stock, a change in par value, a change
from par value to no par value or a change from no par value to par value), or
any merger, consolidation, statutory share exchange or combination to which the
Company is a party and for which approval of any stockholders of the Company is
required, or the sale, transfer or conveyance of all or substantially all of
the assets of the Company; or


 


(e)           there shall occur the voluntary or
involuntary dissolution, liquidation or winding up of the Company;


 


the Company
shall cause to be filed at each office or agency maintained for the purpose of
conversion of securities pursuant to Section 9.2, and shall cause to be
provided to the Trustee and all Holders in accordance with Section 14.2, at
least 20 days (or 10 days in any case specified in clause (a) or (b) above)
prior to the applicable record or effective date hereinafter specified, a
notice stating:


 


(i)            the
date on which a record is to be taken for the purpose of such dividend, distribution,
rights or warrants, or, if a record is not to be taken, the date as of which
the holders of shares of Common Stock of record to be entitled to such
dividend, distribution, rights or warrants are to be determined; or


 


(ii)           the
date on which such reclassification, merger, consolidation, statutory share
exchange, combination, sale, transfer, conveyance, dissolution, liquidation or
winding up is expected to become effective, and the date as of which it is
expected that holders of shares of Common Stock of record shall be entitled to
exchange their shares of Common Stock for securities, cash or other property
deliverable upon such reclassification, merger, consolidation, statutory share
exchange, sale, transfer, dissolution, liquidation or winding up.


 


Neither
the failure to give such notice nor any defect therein shall affect the
legality or validity of the proceedings or actions described in clauses (a) through
(e) of this Section 12.7.


 


Section 12.8         Company to Reserve Common Stock;
Listing.


 


(a)           The
Company shall, in accordance with the laws of the State of Delaware, at all
times reserve and keep available, free from preemptive rights, out of its
authorized but unissued shares of Common Stock, for the purpose of effecting
the conversion of the Notes, such number of its duly authorized shares of
Common Stock as shall from time to time be sufficient to effect the conversion
of all Notes then outstanding into such Common Stock at any time (assuming
that, at the time of the computation of such number of shares or securities,
all such Notes would be held by a single Holder); provided, however, that
nothing contained herein shall preclude the 


 


64

















 


Company from satisfying its obligations in respect of
the conversion of the Notes by delivery of purchased shares of Common Stock
which are then held in the treasury of the Company.


 


(b)           If
any shares of Common Stock which would be issuable upon conversion of Notes
hereunder require registration with or approval of any governmental authority
before such shares or securities may be issued upon such conversion, the
Company will in good faith and as expeditiously as possible endeavor to cause
such shares or securities to be duly registered or approved, as the case may
be.  The Company further covenants that
so long as the Common Stock shall be listed on The Nasdaq Stock Market, Inc.,
the Company will, if permitted by the rules of such exchange, list and
keep listed all Common Stock issuable upon conversion of the Notes, and the
Company will endeavor to list the shares of Common Stock required to be
delivered upon conversion of the Notes prior to such delivery upon any other
national securities exchange upon which the outstanding Common Stock is listed
at the time of such delivery.


 


Section 12.9         Common Stock to be Fully Paid and
Nonassessable.


 


The
Company covenants that all Common Stock which may be issued upon conversion of
Notes will upon issue be fully paid and nonassessable and, except as provided
in Section 12.10, the Company will pay all taxes, liens and charges with
respect to the issue thereof.


 


Section 12.10       Taxes on Conversions.


 


Except
as provided in the next sentence, the Company will pay any and all taxes (other
than taxes on income) and duties that may be payable in respect of the issue or
delivery of shares of Common Stock on conversion of Notes pursuant to Article 12.  A Holder delivering a Note for conversion
shall be liable for and will be required to pay any tax or duty which may be
payable in respect of any transfer involved in the issue and delivery of shares
of Common Stock in a name other than that of the Holder of the Note or Notes to
be converted, and no such issue or delivery shall be made unless the Person
requesting such issue has paid to the Company the amount of any such tax or
duty, or has established to the satisfaction of the Company that such tax or
duty has been paid.


 


Section 12.11       Cancellation of Converted Notes.


 


All
Notes delivered for conversion shall be delivered to the Trustee to be canceled
by or at the direction of the Trustee.


 


Section 12.12       Option to Satisfy Conversion Obligation
with Cash, Common Stock or Combination Thereof.


 


(a)           Subject
to Section 12.1(c), except to the extent that the Company has irrevocably
elected to make a cash payment of principal upon conversion pursuant to Section 12.12(b),
the Company may elect to deliver either shares of its Common Stock, cash or a
combination of cash and shares of Common Stock in satisfaction of the Company’s
obligation upon conversion of the Notes (the “Conversion
Obligation”).  The Company
shall notify the Holder or Holders, as the case may be, through the Trustee, of
the method the Company chooses to satisfy its Conversion Obligation, (i) in
the Company’s notice of Fundamental Change, if a Fundamental Change occurs, (ii) 26
Trading Days immediately preceding the Stated Maturity in respect of Notes to
be 


 


65

















 


converted during the period beginning 25 Trading Days
immediately preceding the Stated Maturity and ending one Trading Day
immediately preceding the Stated Maturity, and (iii) no later than two
Trading Days immediately following the Conversion Date in all other cases (such
period, the “Settlement Notice Period”).  If the Company elects to satisfy any portion
of its Conversion Obligation by delivering cash, the Company shall specify in
such notice the portion to be paid in cash either as a percentage of the
Conversion Obligation or as the lesser of (a) a fixed dollar amount and (b) the
Conversion Value.  The Company shall
treat all Holders converting on the same Trading Day in the same manner.  The Company shall not have any obligation to
satisfy Conversion Obligations arising on different Trading Days in the same
manner.


 


If the
Company elects to satisfy any portion of the Conversion Obligation in cash
(other than cash in lieu of fractional shares, if applicable), a Holder may
retract its conversion notice at any time during the two Trading-Day period
beginning on the Trading Day after the last Trading Day of the Settlement
Notice Period  (the “Conversion Retraction Period”); provided
that no such retraction can be made (and a conversion notice shall be
irrevocable) (x) if the Holder delivers the conversion notice in
connection with a Fundamental Change, (y) if the Holder delivers the
conversion notice during the period beginning 25 Trading Days immediately
preceding the Stated Maturity and ending one Trading Day immediately preceding
the Stated Maturity or (z) if the Company has irrevocably elected pursuant
to Section 12.12(b) to make a cash payment of principal upon
conversion before such Holder delivers its conversion notice.  No retraction can be made and a conversion
notice shall be irrevocable if the Company does not elect to deliver cash upon
conversion.


 


With
respect to each Holder that exercises its conversion right in accordance with
the Indenture, if such Holder’s conversion notice has not been retracted,
assuming all of the other requirements have been satisfied by such Holder, then
settlement (x) in Common Stock only shall occur as soon as practicable
after the Company notifies the Holder or Holders that settlement shall be in
Common Stock only, but in no event later than three Trading Days following the
Conversion Date and (y) in cash or in a combination of cash and Common
Stock shall occur on the second Trading Day following the final Trading Day of
the Conversion Period.


 


Subject
to Section 12.1(c), settlement amounts shall be computed as follows:


 


(i)            if the Company
elects to satisfy the entire Conversion Obligation in Common Stock, the Company
shall deliver to such Holder, for each $1,000 Principal amount of Notes
converted, a number of shares of Common Stock equal to the Conversion Rate in effect on the
Conversion Date (plus cash in lieu of fractional shares, if applicable,
calculated as provided in Section 12.3);


 


(ii)           if the Company
elects to satisfy the entire Conversion Obligation in cash, the Company shall
deliver to such holder for each $1,000 principal amount of Notes converted cash
in an amount equal to the Conversion Value; and


 


(iii)          if the Company
elects to satisfy the Conversion Obligation in a combination of cash (excluding
any cash paid for fractional shares, if applicable) 


 


66

















 


and Common Stock
(including pursuant to Section 12.12(b) hereof), the Company shall
deliver to such Holder for each $1,000 principal amount of Notes converted:


 


(A)                              an
amount in cash (the “Cash Amount”)
equal to (x) the fixed dollar amount per $1,000 principal amount of Notes
of the Conversion Obligation to be satisfied in cash specified in the notice
regarding the Company’s chosen method of settlement or, if lower, the
Conversion Value in cash, or (y) the percentage of the Conversion
Obligation to be satisfied in cash specified in the notice regarding the
Company’s chosen method of settlement multiplied by the Conversion Value, as
the case may be; and


 


(B)                                a
number of shares of Common Stock for each of the 20 trading days in the
Conversion Period equal to 1/20th of (x) the Conversion Rate in
effect on that day minus (y) the quotient of the Cash Amount divided by
the Applicable Stock Price for that day (plus cash in lieu of fractional
shares, if applicable, calculated as provided in Section 12.3).


 


(b)           Notwithstanding
anything to the contrary in this Indenture, at any time prior to the 26th
Trading Day preceding the Stated Maturity, the Company may irrevocably elect,
in its sole discretion without the consent of the Holders of the Notes, by
written notice to the Trustee and the Holders of the Notes, to satisfy in cash
the Conversion Obligation with respect to the Principal amount of Notes to be
converted after the date of such election, with any remaining amount of the
Conversion Obligation to be satisfied in shares of Common Stock.  The settlement amount will be computed as
described under clause (a)(iii) above, using the $1,000 as the fixed
dollar amount per $1,000 principal amount of Notes of the Conversion Obligation
to be satisfied in cash.


 


(c)           If,
on or after the applicable Share Delivery Date (i) the certificate for
shares of Common Stock has not been delivered by the Company to a Holder and (ii) such
Holder purchases (in an open market transaction or otherwise) shares of Common
Stock to deliver in satisfaction of a sale by such Holder of shares of Common
Stock issuable upon such conversion that the Holder anticipated receiving from
the Company (a “Buy-In”), then the Company shall, within three (3) Trading
Days after the Holder’s written request (which request shall include evidence
of the purchase and a breakdown of the purchase price) and in such Holder’s
discretion, either (x) pay cash to such Holder in an amount equal to such
Holder’s total purchase price (including brokerage commissions and other out-of-pocket
expenses, if any) for the shares of Common Stock so purchased (the “Buy-In Price”), at which point the Company’s
obligation to deliver such certificate (and to issue such shares of Common
Stock) shall terminate, or (y) promptly honor its obligation to deliver to
such Holder a certificate or certificates representing such Common Stock and
pay cash to such Holder in an amount equal to the excess (if any) of the Buy-In
Price over the product of (A) such number of shares of Common Stock, times
(B) the Market Price on the Conversion Date.


 


67
















 


(d)           For
purposes of this Section 12.12, the following terms shall have the
meanings indicated:


 


(i)            “Applicable
Stock Price” on any Trading Day means (i) the
volume-weighted average price per share of the Common Stock on such Trading Day
as displayed under the heading “Bloomberg VWAP” on Bloomberg (or any successor
service) page MSPD <equity> AQR (or any successor page) in respect
of the period from 9:30 a.m. to 4:00 p.m., New York City time, on
that Trading Day or (ii), if such price is not available, the Market Price per
share of Common Stock on that day or (iii), if neither the price contemplated
by clause (i) nor (ii) is available, the market value per share of
Common Stock on that day as determined by a nationally recognized independent
investment banking firm retained for this purpose by the Company.


 


(ii)           “Conversion Period” means the 20 Trading Day
period:


 


(A)                              beginning
on the Stated Maturity, if the Holder delivers the conversion notice during the
period beginning 25 Trading Days immediately preceding the Stated Maturity and
ending one Trading Day immediately preceding the Stated Maturity (whether or
not the Company has irrevocably elected to make a cash payment of principal
upon conversion);


 


(B)                                beginning
on the Trading Day following the Company’s receipt of the Holder’s conversion
notice, if the Company has irrevocably elected pursuant to Section 12.12(b) to
make a cash payment of principal upon conversion, provided that if the Holder
submits its conversion notice during the period beginning 25 Trading Days
immediately preceding the Stated Maturity and ending one Trading Day
immediately preceding the Stated Maturity, the Conversion Period shall begin on
the Stated Maturity;


 


(C)                                beginning
on the Trading Day following the Company’s receipt of the Holder’s conversion
notice, if the Holder is exercising its conversion right within 30 days
following a Fundamental Change; and


 


(D)                               beginning
on the Trading Day following the final Trading Day of the Conversion Retraction
Period, in all other cases.


 


(iii)          “Conversion Value” for every $1,000
principal amount of a Note being converted means an amount equal to the sum of
the daily conversion values for each of the 20 Trading Days in the Conversion
Period, where the “daily conversion value” for any Trading Day equals 1/20th
of:


 


(A)                              the
Conversion Rate in effect on that day multiplied by


 


(B)                                the
Applicable Stock Price on that day,


 


provided that, with
respect any conversion (i) during the period beginning 25 Trading Days
immediately preceding the Stated Maturity and ending one Trading 


 


68

















 


Day immediately preceding
the Stated Maturity or (ii) of a Note converted in the period 30 days
after notice of a Fundamental Change is given, if the Applicable Stock Price on
the Conversion Date exceeds the then applicable Conversion Price, the
Conversion Value shall not be less than $1,000.


 


Section 12.13       Responsibility of Trustee for Conversion
Provisions.


 


The Trustee and any Conversion Agent shall not at any
time be under any duty or responsibility to any Holder to determine whether any
facts exist which may require any adjustment of the Conversion Price, or with
respect to the nature or intent of any such adjustments when made, or with
respect to the method employed, or herein or in any supplemental indenture
provided to be employed, in making the same. 
Neither the Trustee nor any Conversion Agent shall be accountable with
respect to the validity or value (of the kind or amount) of any Common Stock or
of any other securities or property, which may at any time be issued or
delivered upon the conversion of any Note; and it or they do not make any
representation with respect thereto. 
Neither the Trustee nor any Conversion Agent shall be responsible for
any failure of the Company to make any cash payment or to issue, transfer or
deliver any shares of stock or share certificates or other securities or
property upon the surrender of any Note for the purpose of conversion; and the
Trustee and any Conversion Agent shall not be responsible or liable for any
failure of the Company to comply with any of the covenants of the Company
contained in this Article.


 


Section 12.14       Withholding Taxes on Adjustments of the
Conversion Price.


 


If a
taxable distribution to holders of the Company’s Common Stock or other
transaction occurs which results in any adjustment of the Conversion Price,
Holders of Notes may, in certain circumstances, be deemed to have received a
distribution subject to U.S. income tax as a dividend.  Because a constructive dividend deemed
received by a holder that is not a U.S. person (as defined by Section 7701(a)(30)
of the Internal Revenue Code of 1986, as amended) would not give rise to any
cash from which any applicable withholding tax could be satisfied, the Company
may set-off any such withholding tax against cash payments payable on the
Notes.


 


Section 12.15       Limitations on Conversion.


 


(a)           The Company shall not effect any
conversion of a Note, and no Holder shall have the right to convert any portion
of such Note, to the extent that after giving effect to such conversion, such
Holder (together with such Holder’s affiliates) 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 “Holder
Adjustable  Conversion Limitation”).  For purposes of the foregoing sentence, the
number of shares of Common Stock beneficially owned by such Holder and its
affiliates 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 that
would be issuable upon (A) conversion of the remaining, nonconverted
portion of any Note beneficially owned by such Holder or any of its affiliates
and (B) exercise or conversion of the unexercised or nonconverted portion
of any other securities of the Company beneficially owned by such Holder or any
of its affiliates that is subject to a limitation on conversion or exercise
analogous to the limitation 


 


69

















 


contained herein. 
Except as set forth in the preceding sentence, for purposes of this Section 12.15(a),
beneficial ownership shall be calculated in accordance with Section 13(d) of
the Exchange Act.  For purposes of this Section 12.15(a),
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.  For any reason at any time, upon the written
or oral request of a Holder, the Company shall within two Business Days confirm
orally and in writing to such Holder the number of shares of Common Stock then
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 or its affiliates since the date as of which such number of
outstanding shares of Common Stock was reported.  By written notice to the Company, any Holder
may increase or decrease the Holder Adjustable 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 Company, and (ii) any such increase or decrease
will apply only to the Holder sending such notice and not to any other Holder
of Notes.  Notwithstanding the foregoing,
the Holder Adjustable Conversion Limitation shall not be applicable (i) on
any of the ten Trading Days up to and including the Stated Maturity, or (ii) on
any of the ten Trading Days up to and including the effective date of a
Fundamental Change or (iii) during the period between the date that any
notice of Fundamental Change is sent pursuant to Section 11.1 and the
applicable Purchase Date.


 


(b)           A Holder of Notes may only convert
Notes to the extent that such Holder and any Group in which it is a member will
not beneficially own immediately following such conversion, outstanding shares
constituting (i) more than 14.9% of the outstanding shares of Common Stock
so long as the Rights Agreement is in effect, and (ii) thereafter, more
than 19.99% of the outstanding shares of Common Stock.  When a Holder delivers any Note for
conversion, such Holder will be deemed to represent that, immediately following
conversion, such Holder and any such Group will not beneficially own
outstanding shares constituting more than the percentage of outstanding shares
of Common Stock permitted by the preceding sentence.  To the extent a Holder attempts to convert
Notes which would result in such Holder and any such Group beneficially owning
outstanding shares constituting more than the percentage of the outstanding
shares of Common Stock permitted by this Section 12.15(b), the purported
conversion will be void and such Holder will not acquire any rights in the
shares of Common Stock that would result in such Holder and any such Group
beneficially owning outstanding shares constituting more than the percentage of
the outstanding shares of Common Stock permitted by this Section 12.15(b).  As used in this Section 12.15(b), the
term beneficial ownership shall have the meaning given to such term in the
Rights Agreement.


 


(c)           Notwithstanding any other provision
of this Indenture, in no event will the aggregate number of shares of Common
Stock issued upon conversion of the Notes exceed 19.99% of the aggregate number
of shares of Common Stock outstanding at the time of the initial issuance of
the Notes (as adjusted for any stock split, stock dividend, stock combination
or other similar transaction that proportionately decreases or increases the
Common Stock following the initial issuance of the Notes), except that such limitation
shall not apply in the 


 


70

















 


event that the Company obtains the approval of its
stockholders as required by the applicable rules of The Nasdaq Global
Market for issuances of Common Stock in excess of such amount.


 


(d)           For purposes of all conversion
limitations set forth in this Indenture, except:


 


(i)            under the circumstance described in Section 12.12(b) where
the Company has made an irrevocable election to satisfy its Conversion
Obligation with respect to the principal amount of Notes converted after the
date of such election in cash, and


 


(ii)           if Additional Common Stock to be
issued as described in the last paragraph of Section 12.1 would result in
the total number of shares of Common Stock issuable upon conversion of the
Notes to exceed 19.99% of the Common Stock outstanding at the time of the
initial issuance of the Notes (as adjusted for any stock split, stock dividend,
stock combination or other similar transaction that proportionately decreases or
increases the Common Stock following the initial issuance of the Notes) and the
Company has not obtained the approval of its stockholders as described in Section 12.15(c),


 


a Holder must assume that the Conversion Obligation
will be satisfied solely in Common Stock for purposes of determining the
maximum amount of Notes that can be converted by such Holder from time to time.


 


ARTICLE 13



[INTENTIONALLY OMITTED]


 


ARTICLE 14



OTHER PROVISIONS OF GENERAL APPLICATION


 


Section 14.1         Trust Indenture Act Controls.


 


This
Indenture is subject to the provisions of the TIA which are required to be part
of this Indenture, and shall, to the extent applicable, be governed by such
provisions.


 


Section 14.2         Notices.


 


Any
notice or communication to the Company or the Trustee is duly given if in
writing (which may be by facsimile with the original to follow) and delivered
in person or mailed by first-class mail to the address set forth below:


 


(a)           if to the Company:


 


Mindspeed Technologies, Inc.


4000 MacArthur Boulevard


East Tower


 


71

















 


Newport Beach,
California  92660-3095


Attention: Brandi Steege, Esq.


Fax:  (949) 579-3439


Telephone:  (949) 579-3010


 


With a copy to:


 


Morrison &
Foerster LLP


425 Market Street


San Francisco, California  94105-2482


Attention:  Robert M. Mattson, Jr.


Fax:  (415) 268-7522


Telephone:  (415) 268-6621


 


(b)           if to the Trustee:


 


Wells Fargo Bank, N.A.


Corporate Trust Services


707 Wilshire Boulevard, 17th Floor


Los Angeles, CA 
90017


Attention: 
Mindspeed Administrator


Fax: 
213-614-2588


Telephone:  213-614-3355


 


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


 


Any notice or communication to
a Holder shall be mailed by first class mail to his address shown on the
Register kept by the Registrar.  Failure
to mail a notice or communication to a Holder or any defect in such notice or
communication shall not affect its sufficiency with respect to other
Holders.  If the Company mails a notice
or communication to Holders, it shall mail a copy to the Trustee at the same
time.


 


If a notice or communication is
mailed or sent in the manner provided above within the time prescribed it is
duly given as of the date it is mailed, whether or not the addressee receives
it, except that notice to the Trustee shall only be effective upon receipt
thereof by the Trustee.


 


Section 14.3         Communication by Holders with Other
Holders.


 


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


 


Section 14.4         Acts of Holders of Notes.


 


(a)           Any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Indenture to be given or taken by Holders may be
embodied in and 


 


72

















 


evidenced by one or more instruments of substantially
similar tenor signed by such Holders in person or by agent or proxy duly
appointed in writing.


 


Except
as herein otherwise expressly provided, such action shall become effective when
such instrument or instruments or record or both are delivered to the Trustee
and, where it is hereby expressly required, to the Company.  Such instrument or instruments and record
(and the action embodied therein and evidenced thereby) are herein sometimes
referred to as the “Act” of the
Holders signing such instrument or instruments. 
Proof of execution of any such instrument or of a writing appointing any
such agent or proxy, or of the holding by any Person of a Note, shall be
sufficient for any purpose of this Indenture and (subject to Section 5.1)
conclusive in favor of the Trustee and the Company if made in the manner
provided in this Section.


 


(b)           The
fact and date of the execution by any Person of any such instrument or writing
may be provided in any manner that the Trustee reasonably deems sufficient.


 


(c)           The
principal amount and serial numbers of Notes held by any Person, and the date
of such Person holding the same, shall be proved by the Register.


 


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


 


Section 14.5         Certificate and Opinion as to
Conditions Precedent.


 


In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may
certify or give an opinion with respect to some matters and one or more other
such Persons as to other matters, and any such Person may certify or give an
opinion as to such matters in one or several documents.


 


Any
certificate or opinion of an Officer of the Company may be based, insofar as it
relates to legal matters, upon an Opinion of Counsel, unless such Officer
knows, or in the exercise of reasonable care should know, that the Opinion of
Counsel with respect to the matters upon which such certificate or opinion is
based is erroneous.  Any such Opinion of
Counsel may be based, insofar as it relates to factual matters, upon a
certificate or representations by, an Officer or Officers of the Company
stating that the information with respect to such factual matters is in the
possession of the Company unless such counsel knows, or in the exercise of
reasonable care should know, that the certificate or representations with
respect to such matters are erroneous.


 


Where
any Person is required to make, give or execute two or more applications,
requests, consents, certificates, statements, opinions or other instruments
under this Indenture, they may, but need not, be consolidated and form one
instrument.


 


73

















 


Upon
any application or request by the Company to the Trustee to take any action
under any provision of this Indenture, the Company shall furnish to the Trustee
an Officers’ Certificate stating that 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, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate
or opinion need be furnished; provided, however, that, at any time that an
Opinion of Counsel is required to be delivered hereunder, the opining counsel
may, with the consent of the Trustee, deliver to the Trustee the Opinion of
Counsel in question addressed to a party other than the Trustee with text to
the effect that the Trustee may rely on such opinion rather than by delivering
a separate Opinion of Counsel to the Trustee directly.


 


Section 14.6         Statements Required in Certificate or
Opinion.


 


Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture shall include:


 


(a)           a statement that each individual
signing such certificate or opinion on behalf of the Company has read such
covenant or condition and the definitions herein relating thereto;


 


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


 


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


 


(d)           a statement as to whether, in the
opinion of each such individual, such condition or covenant has been complied
with.


 


Section 14.7         Effect of Headings and Table of
Contents.


 


The Article and
Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof.


 


Section 14.8         Successors and Assigns.


 


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


 


Section 14.9         Separability Clause.


 


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


 


74

















 


Section 14.10       Benefits of Indenture.


 


Nothing
contained in this Indenture or in the Notes, express or implied, shall give to
any Person, other than the parties hereto and their successors hereunder and
the Holders, any benefit or legal or equitable right, remedy or claim under
this Indenture.


 


Section 14.11       Governing Law.


 


This
Indenture and the Notes shall be governed by, and construed in accordance with,
the laws of the State of New York (including Section 5-1401 of the General
Obligations Law of the State of New York but otherwise without regard to
conflict of laws principles).


 


Section 14.12       Counterparts.


 


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


 


Section 14.13       Legal Holidays.


 


In any
case where any Interest Payment Date, Purchase Date or Stated Maturity of any
Note or the last day on which a Holder has a right to convert such Note shall
not be a Business Day at any Place of Payment or Place of Conversion, then
(notwithstanding any other provision of this Indenture or of the Notes) payment
of Principal on, or Interest or Additional Interest, if any, on, conversion of
the Notes, need not be made at such Place of Payment or Place of Conversion on
such day, but may be made on the next succeeding Business Day at such Place of
Payment or Place of Conversion with the same force and effect as if made on the
Interest Payment Date, Purchase Date or at the Stated Maturity or on such last
day for conversion; provided, however,
that in the case that payment is made on such succeeding Business Day, no
Interest shall accrue on the amount so payable for the period from and after
such Interest Payment Date, Purchase Date or Stated Maturity, as applicable.


 


Section 14.14       Recourse Against Others.


 


No
recourse for the payment of the Principal of or Interest or Additional
Interest, if any, on any Notes, or for any claim based thereon or otherwise in
respect thereof, shall be had against any incorporator, stockholder, officer or
director or manager, as such, past, present or future, of the Company or any
successor entity to either the Company or such successor entity, whether by
virtue of any constitution, statute or rule of law or by the enforcement
of any assessment or penalty or otherwise, all such liability being, by the
acceptance thereof and as part of the consideration for the issue thereof,
expressly waived and released.


 


Section 14.15       Tax Treatment.


 


The Company agrees, and by acceptance of
beneficial ownership interest in the Notes each beneficial holder of the Notes
will be deemed to have agreed, for United States federal income tax purposes to
treat the Notes as indebtedness that is not subject to the contingent payment
debt instrument regulations under Treas. Reg. Sec. 1.1275-4.


 


75

















 


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


 


 


	
   

  	
  MINDSPEED
  TECHNOLOGIES, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Bret W.
  Johnsen

  
	
   

  	
   

  	
  Name: Bret
  W. Johnsen

  
	
   

  	
   

  	
  Title: Senior
  Vice President, Chief Financial

  
	
   

  	
   

  	
  Officer and
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  WELLS FARGO BANK, N.A.,

  
	
   

  	
  AS TRUSTEE AND NOT IN ITS INDIVIDUAL

  CAPACITY

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Maddy
  Hall

  
	
   

  	
   

  	
  Name: Maddy
  Hall

  
	
   

  	
   

  	
  Title: Vice
  President

  



 

















 


EXHIBIT A


 


FORM OF
NOTE


 


[If a Global Note, insert:


 


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


 


TRANSFERS OF
THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS TO NOMINEES OF THE DEPOSITORY
TRUST COMPANY OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND
TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN ARTICLE TWO OF THE INDENTURE
REFERRED TO ON THE REVERSE HEREOF.]


 


A-1
















 


MINDSPEED
TECHNOLOGIES, INC.


 


6.50%
Convertible Senior Notes due 2013


 


	
  CUSIP NO.

  	
   

  
	
   

  	
   

  
	
  No.

  	
  Principal Amount  $

  
	
   

  	
  [if a Global Note, insert: as such amount

  may be revised by the Schedule of Increases

  and Decreases in Global Note attached

  hereto]

  



 


Mindspeed Technologies, Inc., a Delaware
corporation (including any successor corporation under the Indenture
hereinafter referred to, the “Company”),
for value received, hereby promises to pay to
                          ,
or its registered assigns, the principal sum of
                        
U.S. Dollars
($                          ),
[if a Global Note, insert:   as revised
by the Schedule of Increases and Decreases in Global Note attached hereto,] on August 1,
2013.


 


Interest Payment Dates:  February 1 and August 1, commencing
February 1, 2009.


 


Regular Record Dates:  January 15 and July 15.


 


Reference is hereby made to the further
provisions of this Note set forth below, which further provisions shall for all
purposes have the same effect as if set forth at this place.


 


IN WITNESS WHEREOF, the Company has caused
this Note to be duly executed manually or by facsimile by its duly authorized
officers.


 


	
   

  	
   

  	
  Mindspeed Technologies, Inc.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Dated:
            
      , 20    

  



 


A-2

















 


Trustee’s Certificate of Authentication


 


This is one of the 6.50% Convertible Senior Notes due 2013 described in
the within-named Indenture.


 


	
  Wells Fargo Bank, N.A., as TRUSTEE

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Authorized
  Signatory

  
	
   

  	
   

  
	
  Dated:

  	
                ,
  20

  
				



 


A-3

















 


MINDSPEED
TECHNOLOGIES, INC.


 


6.50%
Convertible Senior Note due 2013


 


SECTION 1    Indenture; Notes.


 


This Note is one of a duly authorized series
of the 6.50% Convertible Senior Notes due 2013 (the “Notes”) of Mindspeed Technologies, Inc., a Delaware
corporation (including any successor Person under the Indenture hereinafter
referred to, the “Company”),
issued under an Indenture, dated as of August 1, 2008 (the “Indenture”), between the Company and Wells
Fargo Bank, N.A., as trustee (the “Trustee”).  The terms of the Note include those stated in
the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (“TIA”).  This Note is subject to all such terms, and
Holders are referred to the Indenture and the TIA for a statement of all such
terms.  To the extent permitted by
applicable law, in the event of any inconsistency or difference between the
terms of this Note and the terms of the Indenture, the terms of the Indenture
shall control.  Capitalized terms used
but not defined herein have the meanings assigned to them in the Indenture.


 


SECTION 2    Principal and Interest.


 


The Company promises to pay Interest, and
Additional Interest, if any, on the principal amount of the Notes at the
Interest Rate from the date of issuance until repayment in full at Stated
Maturity or repurchase.  The Company will
pay Interest and Additional Interest, if any, on this Note semi-annually, in arrears,
on February 1 and August 1 of each year (each, an “Interest Payment Date”), commencing February 1,
2009.


 


The Notes shall bear Interest from August 1,
2008 until the Principal thereof is paid or made available for payment, or
until such date on which the Notes are converted or purchased as provided
herein, at a rate of 6.50% per annum.


 


Interest and Additional Interest, if any, on
the Notes shall be computed (i) for any full semi-annual period for which
a particular Interest Rate is applicable, on the basis of a 360-day year
comprised of twelve 30-day months and (ii) for any period for which a
particular Interest Rate is applicable for less than a full semiannual period
for which Interest is calculated, on the basis of a 30-day month and, for such
periods of less than a month, the actual number of days elapsed over a 30-day
month.


 


Further reference is made to Sections 2.1 of
the Indenture for other provisions of the Notes relating to the payment of
Interest.


 


If the Company fails to make a payment of
Principal of or Interest or Additional Interest, if any, on any Note when due
and payable, it shall pay such Interest on such amounts (to the extent lawful),
which shall be calculated using the applicable Interest Rate (such amounts, the
“Defaulted Interest”).  It may elect to pay such Defaulted Interest,
plus any other Interest and Additional Interest, if any, payable on it, to the
Persons who are Holders on which the Interest is due on a subsequent special
record date.  The Company shall notify
the Trustee in writing of the amount of Defaulted Interest proposed to be paid
on each such Note.  The Company shall fix
any such special record date and payment date for such payment.  At least 15 days before any such 


 


A-4

















 


special record
date, the Company shall mail to Holders affected thereby a notice that states
the special record date, the Interest Payment Date and amount to be paid.


 


SECTION 3    Method of Payment.


 


Interest and Additional Interest, if any, on
this Note which is payable, and is punctually paid or duly provided for, on any
Interest Payment Date shall be paid to the Person in whose name that Note (or
one or more Predecessor Notes) is registered at the close of business on the
Regular Record Date for such Interest.


 


Principal of, and Interest and Additional
Interest, if any, on, Global Notes will be payable, for the benefit of the
Holders of this Note, to the Depositary in immediately available funds.


 


Principal on Physical Notes will be payable
at the office or agency of the Company maintained for such purpose, initially
the Corporate Trust Office of the Trustee. 
Interest and Additional Interest, if any, on Physical Notes will be
payable by (i) a U.S. Dollar check drawn on a U.S. bank mailed to the address
of the Person entitled thereto as such address shall appear in the Register, or
(ii) upon application to the Registrar not later than the 5 Business Days
prior to the date of Stated Maturity by a Holder of an aggregate Principal
amount of Notes in excess of $5,000,000, wire transfer in immediately available
funds.


 


SECTION 4    Paying Agent and Registrar.


 


Initially, the Trustee will act as Paying
Agent and Registrar.  The Company may
change the Paying Agent or Registrar without notice to any Holder.


 


SECTION 5    Optional Redemption.


 


The Notes may not be redeemed by the Company
prior to maturity.


 


SECTION 6    Purchase Right.


 


Reference is made to Article 11 of the
Indenture regarding the Company’s obligations to the Holders upon a Fundamental
Change and upon a Financial Statement Delivery Default and the Holders’ rights
to require the Company to repurchase their Notes upon a Fundamental Change and
upon a Financial Statement Delivery Default, which is incorporated into this
Note by reference as if stated herein in its entirety.


 


SECTION 7    Conversion Right and Limitation on
Conversion Right.


 


Reference is made to Article 12 of the
Indenture regarding the Holders’ right to convert their Notes and related
matters, which is incorporated into this Note by reference as if stated herein
in its entirety.


 


A Holder of Notes may only convert Notes to
the extent that such Holder and any Group of which it is a member will not
beneficially own immediately following such conversion, outstanding shares
constituting (i) more than 14.9% of the outstanding shares of Common Stock



 


A-5

















 


so long as the
Rights Agreement is in effect, and (ii) thereafter more than 19.99% of the
outstanding shares of Common Stock.  When
a Holder delivers any Note for conversion, such Holder will be deemed to
represent that, immediately following conversion, such Holder and any such
Group will not beneficially own outstanding shares constituting more than the
percentage of the outstanding shares of Common Stock permitted by this
paragraph.  To the extent a Holder
attempts to convert Notes which would result in such Holder and any such Group
beneficially owning outstanding shares constituting more than the percentage of
the outstanding shares of Common Stock permitted by this paragraph, the
purported conversion will be void and such Holder will not acquire any rights
in the shares of Common Stock that would result in such Holder and any such
Group beneficially owning outstanding shares constituting more than the
percentage of the outstanding shares of Common Stock permitted by this
paragraph.


 


The Company shall not effect any conversion
of a Note, and no Holder shall have the right to convert any portion of such
Note, to the extent that after giving effect to such conversion, such Holder
(together with such Holder’s affiliates) would beneficially own in excess of
the applicable Holder Adjustable Conversion Limitation.  By written notice to the Company, any Holder
may increase or decrease the Holder Adjustable 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 Company, and (ii) any such increase or decrease
will apply only to the Holder sending such notice and not to any other Holder
of Notes.  Notwithstanding the foregoing,
the Holder Adjustable Conversion Limitation shall not be applicable (i) on
any of the ten Trading Days up to and including the Stated Maturity, or (ii) on
any of the ten Trading Days up to and including the effective date of a
Fundamental Change or (iii) during the period between the date that any
notice of Fundamental Change is sent pursuant to Section 11.1 of the
Indenture and the applicable Purchase Date.


 


Notwithstanding any other provision of this
Note or the Indenture, in no event will the aggregate number of shares of
Common Stock issued upon conversion of the Notes exceed 19.99% of the aggregate
number of shares of Common Stock outstanding at the time of the initial
issuance of the Notes (as adjusted for any stock split, stock dividend, stock
combination or other similar transaction that proportionately decreases or
increases the Common Stock following the initial issuance of the Notes), except
that such limitation shall not apply in the event that the Company obtains the
approval of its stockholders as required by the applicable rules of The
Nasdaq Global Market for issuances of Common Stock in excess of such amount.


 


SECTION 8    No Sinking Fund.


 


The Notes are not subject to a sinking fund.


 


SECTION 9    Absolute Obligation.


 


No reference herein to the Indenture and no
provision of this Note or of the Indenture shall alter or impair the obligation
of the Company under the Indenture and this Note which is absolute and
unconditional, to pay the Principal of or Interest on this Note at the place
and time and in the coin or currency herein prescribed.


 


A-6

















 


SECTION 10    Denominations; Transfer; Exchange.


 


The Notes are issuable in registered form,
without coupons, in denominations of $1,000 and integral multiples of $1,000 in
excess thereof.  A Holder may transfer
and register the transfer or exchange of Notes in accordance with the
Indenture.


 


Pursuant to the Indenture, when this Note (or
any portion thereof in integral multiples of $1,000 in principle amount) is
presented to the Registrar with a request to register the transfer or to
exchange it for an equal principal amount of other authorized denominations,
the Registrar shall register the transfer or make the exchange as requested if
the requirements hereunder for such transactions are met (including that such
portions thereof are duly endorsed or accompanied by a written instrument of
transfer duly executed by the Holder thereof or by an attorney who is
authorized in writing to act on behalf of the Holder).  Subject to Section 2.4 of the Indenture,
to permit registrations of transfers and exchanges, the Company shall execute
and the Trustee shall authenticate Notes at the Registrar’s request.  No service charge shall be made for any
registration of transfer or exchange of the Notes, but the Company may require
payment of a sum sufficient to cover any transfer tax or similar governmental
charge payable in connection therewith (other than any such transfer taxes or
other similar governmental charge payable upon exchanges pursuant to Sections
2.14 or 7.5 of the Indenture).


 


Pursuant to the Indenture, neither the
Company nor the Registrar shall be required to exchange or register a transfer
of this Note (or any portion thereof) surrendered for conversion or, if a
portion of this Note is surrendered for conversion, such portion thereof
surrendered for conversion.


 


In the event of conversion or purchase of the
Notes in part only, a new Note or Notes for the unconverted or unpurchased
portion thereof will be issued in the name of the Holder hereof.


 


SECTION 11    Persons Deemed Owners.


 


The registered Holder of this Note shall be
treated as its owner for all purposes.


 


SECTION 12    Discharge Prior to Stated Maturity.


 


Subject to certain conditions contained in
the Indenture, the Company may discharge its obligations under the Notes and
the Indenture if (1)(A) all of the Outstanding Notes shall become due and
payable at their scheduled Stated Maturity or (B) all of the Outstanding
Notes have all been converted, and (2) the Company shall have deposited
with the Trustee cash or, in the event of a conversion pursuant to the terms of
the Indenture, cash and/or Common Stock, sufficient to pay all amounts due and
owing on all Outstanding Notes on the date of their scheduled maturity or
delivery of the converted Note.


 


A-7

















 


SECTION 13    Amendment; Supplement; Waiver.


 


The Indenture permits, with certain
exceptions as therein provided, the amendment thereof and the modification of
the rights and obligations of the Company and the rights of the Holders of the
Notes under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of a majority of the aggregate principal amount of the
Outstanding Notes.  The Indenture also
contains provisions permitting the Holders of specified percentages in
principal amount of the Notes at the time Outstanding, on behalf of the Holders
of all the Notes, to waive compliance by the Company with certain provisions of
the Indenture and certain past defaults under the Indenture and their
consequences.


 


No reference herein to the Indenture and no
provision of this Note or of the Indenture shall alter or impair the obligation
of the Company, which is absolute and unconditional, to pay the Principal of
and Interest on this Note at the times, places and rate, and in the coin or
currency, herein prescribed or to convert this Note (or pay cash in lieu of
conversion) as provided in the Indenture.


 


SECTION 14    Defaults and Remedies.


 


Reference is
made to the Indenture for the Events of Default, remedies and related
provisions with respect to the Notes, which is incorporated into this Note by
reference as if stated herein in its entirety.


 


SECTION 15    Authentication.


 


This Note shall not be valid until the
Trustee executes the certificate of authentication in the space provided
therefor on the Note.


 


SECTION 16    Abbreviations.


 


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


 


SECTION 17    CUSIP Numbers.


 


Pursuant to a recommendation promulgated by
the Committee on Uniform Note Identification Procedures, the Company has caused
one or more CUSIP numbers, as appropriate, to be printed on this Note and the
Trustee may use CUSIP numbers in notices as a convenience to Holders.  No representation is made as to the accuracy
of such numbers either as printed on this Note or as contained in any notice
and reliance may be placed only on the other identification numbers placed
thereon.


 


A-8

















 


SECTION 18    Governing Law.


 


The Indenture and this Note shall be governed
by, and construed in accordance with, the laws of the State of New York
(including Section 5-1401 of the General Obligations Law of the State of
New York but otherwise without regard to conflict of laws principles).


 


SECTION 19    Successor Corporation.


 


In the event a successor Person assumes all
the obligations of the Company under this Note pursuant to the terms hereof and
of the Indenture, the Company will be released from all such obligations.


 


SECTION 20    Tax Treatment.


 


The Company agrees, and by acceptance of
beneficial ownership interest in the Notes each beneficial holder of the Notes
will be deemed to have agreed, for United States federal income tax purposes to
treat the Notes as indebtedness that is not subject to the contingent payment
debt instrument regulations under Treas. Reg. Sec. 1.1275-4.


 


SECTION 21    Unclaimed Money or Securities.


 


The Trustee and the Paying Agent shall return to the
Company upon written request any money held by them for the payment of any
amount with respect to the Notes that remains unclaimed for two years, subject to
applicable unclaimed property law.  After
return to the Company, Holders entitled to the money or securities must look to
the Company for payment as general creditors unless an applicable abandoned
property law designates another Person.


 


A-9

















 


ASSIGNMENT
FORM


 


To assign this Note,
fill in the form below and have your signature guaranteed: (I) or (we)
assign and transfer this Note to:


 


	
   

  
	
  (Insert assignee’s social security or tax I.D.
  number)

  
	
   

  
	
   

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

  
	
   

  
	
  and
  irrevocably appoint
                          
  to transfer this Note on the books of the Company. The agent may substitute
  another to act for him.

  
	
   

  
	
  Your Name:

  	
   

  
	
  (Print your name exactly as it appears on the face
  of this Note)

  
	
   

  
	
  Dated:

  	
   

  
	
   

  
	
  Your Signature:

  	
   

  
	
  (Sign exactly as your name appears on the face of
  this Note)

  
	
   

  
	
  Signature Guarantee*:

  	
   

  
					



 






*              Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).


 


A-10

















 


[TO BE ATTACHED TO GLOBAL
NOTES]


 


SCHEDULE
OF INCREASES AND DECREASES IN GLOBAL NOTE


 


The following increases or decreases in this
Global Note have been made:


 


	
  Date

  	
   

  	
  Amount of decrease in Principal

  Amount of this Global Note

  	
   

  	
  Amount of increase in Principal

  Amount of this Global Note

  	
   

  	
  Principal Amount of this Global

  Note following such decrease or

  increase

  	
   

  	
  Signature of authorized

  signatory of Trustee or

  Securities Custodian

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


A-11

















 


EXHIBIT B


 


FORM OF PURCHASE NOTICE


 


TO:                           Mindspeed
Technologies, Inc.


4000 MacArthur
Boulevard


East Tower


Newport Beach,
California  92660-3095


 


The undersigned registered owner of this Note
hereby irrevocably [acknowledges receipt of a notice from Mindspeed
Technologies, Inc. (the “Company”)
as to the occurrence of a Fundamental Change with respect to the Company and](1) requests
and instructs the Company to repay the entire principal amount of this Note, or
the portion thereof (which is $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 Interest, if any, accrued and unpaid to,
but excluding, such date, to the registered Holder hereof.


 


 


	
  Your Name:

  	
   

  
	
   

  	
  (Print your name exactly as it appears on the face
  of this Note)

  
	
   

  
	
  Dated:

  	
   

  
	
   

  
	
  Your Signature:

  	
   

  
	
   

  	
  (Sign exactly
  as your name appears on the face of this Note)

  
	
   

  
	
  Signature Guarantee*:

  	
   

  
	
   

  
	
  Social Security or other Taxpayer Identification Number:

  	
   

  
	
   

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

  	
   

  
	
   

  
	
  Certificate number (if applicable):

  	
   

  
								



 






(1)  Include bracketed text if the Purchase Notice is given in
connection with a Fundamental Change.


 


*                                         Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).


 


B-1

















 


EXHIBIT C


 


FORM OF
CONVERSION NOTICE


 


TO:                           Mindspeed
Technologies, Inc.


4000 MacArthur
Boulevard


East Tower


Newport Beach, California  92660-3095


 


The
undersigned registered owner of this Note hereby irrevocably exercises the
option to convert this Note, or the portion hereof (which is $1,000 principal
amount or an integral multiple thereof) below designated, in accordance with
the terms of the Indenture referred to in this Note, and directs that any
shares issuable and deliverable upon such conversion, together with any check
in payment for fractional shares or cash conversion option 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 any shares, or payment 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.  To the extent
provided in the Indenture, any amount required to be paid to the undersigned on
account of Interest, if any, accompanies this Note.


 


The
undersigned represents that, immediately following conversion described above,
the undersigned and any Group of which the undersigned is a member will not own
outstanding shares constituting more than 9.9% of the outstanding shares of
Common Stock.


 


	
  Your Name:

  	
   

  
	
   

  	
  (Print your name exactly as it appears on the face
  of this Note)

  
	
   

  	
   

  
	
  Dated:

  	
   

  
	
   

  	
   

  
	
  Your Signature:

  	
   

  
	
   

  	
  (Sign exactly as your name appears on the face of
  this Note)

  
	
   

  	
   

  
	
  Signature Guarantee*:

  	
   

  
	
   

  	
   

  
	
  Social Security or other Taxpayer
  Identification Number:

  	
   

  
	
   

  	
   

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

  	
   

  
								



 


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)


 






*                                         Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).


 


C-1