Exhibit 4.1


 


CEPHALON, INC.


 


2.50% CONVERTIBLE SENIOR
SUBORDINATED NOTES DUE MAY 1, 2014


 










 


INDENTURE


DATED AS OF MAY 27, 2009


 










 


U.S. BANK NATIONAL ASSOCIATION,


AS TRUSTEE


 





















 


TABLE OF CONTENTS


 






 


	
   

  	
   

  	
  PAGE

  
	
  ARTICLE
  1

  
	
  DEFINITIONS AND INCORPORATION BY REFERENCE

  
	
   

  
	
  Section 1.01
  . Definitions

  	
   

  	
  1

  
	
  Section 1.02
  . Other Definitions

  	
   

  	
  7

  
	
  Section 1.03
  . Trust Indenture Act Provisions

  	
   

  	
  8

  
	
  Section 1.04
  . Rules of Construction

  	
   

  	
  9

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  2

  
	
  THE SECURITIES

  
	
   

  
	
  Section 2.01
  . Form and Dating

  	
   

  	
  9

  
	
  Section 2.02
  . Execution and Authentication

  	
   

  	
  11

  
	
  Section 2.03
  . Registrar, Paying Agent and Conversion Agent

  	
   

  	
  12

  
	
  Section 2.04
  . Paying Agent to Hold Money in Trust

  	
   

  	
  13

  
	
  Section 2.05
  . Holder Lists

  	
   

  	
  13

  
	
  Section 2.06
  . Transfer and Exchange

  	
   

  	
  13

  
	
  Section 2.07
  . Replacement Securities

  	
   

  	
  14

  
	
  Section 2.08
  . Outstanding Securities

  	
   

  	
  15

  
	
  Section 2.09
  . Treasury Securities

  	
   

  	
  16

  
	
  Section 2.10
  . Temporary Securities

  	
   

  	
  16

  
	
  Section 2.11
  . Cancellation

  	
   

  	
  16

  
	
  Section 2.12
  . Additional Transfer Requirements

  	
   

  	
  16

  
	
  Section 2.13
  . CUSIP Numbers

  	
   

  	
  18

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  3

  
	
  PURCHASES OF SECURITIES UPON FUNDAMENTAL CHANGE

  
	
   

  
	
  Section 3.01
  . Purchase of Securities at Option of the Holder
  Upon Fundamental Change

  	
   

  	
  18

  
	
  Section 3.02
  . Effect of Fundamental Change Purchase Notice

  	
   

  	
  22

  
	
  Section 3.03
  . Deposit of Fundamental Change Purchase Price

  	
   

  	
  23

  
	
  Section 3.04
  . Securities Purchased in Part

  	
   

  	
  23

  
	
  Section 3.05
  . Compliance with Securities Laws Upon Purchase of
  Securities

  	
   

  	
  24

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  4

  
	
  PAYMENT OF INTEREST AND MAKE WHOLE ADJUSTMENT EVENTS

  
	
   

  
	
  Section 4.01 . Interest Payments

  	
   

  	
  24

  
	
  Section 4.02 . Increased Conversion Rate Applicable to Certain Securities
  Surrendered in Connection with Make Whole Adjustment Events

  	
   

  	
  25

  
	
  Section 4.03
  . Adjustments Relating to Make Whole Adjustment
  Event

  	
   

  	
  27

  



 


ii

















 


	
  ARTICLE
  5

  
	
  CONVERSION

  
	
   

  	
   

  	
   

  
	
  Section 5.01
  . Conversion Privilege

  	
   

  	
  27

  
	
  Section 5.02
  . Conversion Procedure

  	
   

  	
  29

  
	
  Section 5.03
  . Fractional Shares

  	
   

  	
  31

  
	
  Section 5.04
  . Taxes on Conversion

  	
   

  	
  31

  
	
  Section 5.05
  . Settlement Upon Conversion

  	
   

  	
  31

  
	
  Section 5.06
  . Adjustment of Conversion Price

  	
   

  	
  33

  
	
  Section 5.07
  . No Adjustment

  	
   

  	
  40

  
	
  Section 5.08
  . Adjustment for Tax Purposes

  	
   

  	
  41

  
	
  Section 5.09
  . Notice of Adjustment

  	
   

  	
  41

  
	
  Section 5.10
  . Notice of Certain Transactions

  	
   

  	
  42

  
	
  Section 5.11
  . Stockholder Rights Plans

  	
   

  	
  42

  
	
  Section 5.12
  . Effect of Reclassification, Consolidation, Merger
  or Sale on Conversion Privilege

  	
   

  	
  42

  
	
  Section 5.13
  . Trustee’s Disclaimer

  	
   

  	
  44

  
	
  Section 5.14
  . Voluntary Reduction

  	
   

  	
  45

  
	
  Section 5.15
  . Exchange in Lieu of Conversion

  	
   

  	
  45

  
	
  Section 5.16
  . Compliance with NASDAQ Market Rule 4350

  	
   

  	
  45

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  6

  
	
  SUBORDINATION

  
	
   

  
	
  Section 6.01
  . Agreement of Subordination

  	
   

  	
  46

  
	
  Section 6.02
  . Payments to Holders

  	
   

  	
  46

  
	
  Section 6.03
  . Subrogation of Securities

  	
   

  	
  49

  
	
  Section 6.04
  . Authorization to Effect Subordination

  	
   

  	
  50

  
	
  Section 6.05
  . Notice to Trustee

  	
   

  	
  50

  
	
  Section 6.06
  . Trustee’s Relation to Senior Indebtedness

  	
   

  	
  51

  
	
  Section 6.07
  . No Impairment of Subordination

  	
   

  	
  51

  
	
  Section 6.08
  . Certain Conversions Deemed Payment

  	
   

  	
  52

  
	
  Section 6.09
  . Article Applicable to Paying Agents

  	
   

  	
  52

  
	
  Section 6.10
  . Senior Indebtedness Entitled to Rely

  	
   

  	
  52

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  7

  
	
  COVENANTS

  
	
   

  
	
  Section 7.01
  . Payment of Securities

  	
   

  	
  53

  
	
  Section 7.02
  . Reports

  	
   

  	
  53

  
	
  Section 7.03
  . Compliance Certificates

  	
   

  	
  53

  
	
  Section 7.04
  . Further Instruments and Acts

  	
   

  	
  54

  
	
  Section 7.05
  . Maintenance of Corporate Existence

  	
   

  	
  54

  
	
  Section 7.06
  . Stay, Extension and Usury Laws

  	
   

  	
  54

  
	
  Section 7.07
  . Additional Interest Notice

  	
   

  	
  54

  



 


iii

















 


	
  ARTICLE
  8

  
	
  CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

  
	
   

  
	
  Section 8.01
  . Company May Consolidate, etc., only on
  Certain Terms

  	
   

  	
  55

  
	
  Section 8.02
  . Successor Substituted

  	
   

  	
  55

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  9

  
	
  DEFAULT AND REMEDIES

  
	
   

  
	
  Section 9.01
  . Events of Default

  	
   

  	
  56

  
	
  Section 9.02
  . Acceleration

  	
   

  	
  58

  
	
  Section 9.03
  . Other Remedies

  	
   

  	
  59

  
	
  Section 9.04
  . Waiver of Defaults and Events of Default

  	
   

  	
  59

  
	
  Section 9.05
  . Control by Majority

  	
   

  	
  60

  
	
  Section 9.06
  . Limitations on Suits

  	
   

  	
  60

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

  	
   

  	
  60

  
	
  Section 9.08
  . Collection Suit by Trustee

  	
   

  	
  61

  
	
  Section 9.09
  . Trustee May File Proofs of Claim

  	
   

  	
  61

  
	
  Section 9.10
  . Priorities

  	
   

  	
  61

  
	
  Section 9.11
  . Undertaking for Costs

  	
   

  	
  62

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  10

  
	
  TRUSTEE

  
	
   

  
	
  Section 10.01
  . Duties of Trustee

  	
   

  	
  62

  
	
  Section 10.02
  . Rights of Trustee

  	
   

  	
  63

  
	
  Section 10.03
  . Individual Rights of Trustee

  	
   

  	
  64

  
	
  Section 10.04
  . Trustee’s Disclaimer

  	
   

  	
  64

  
	
  Section 10.05
  . Notice of Default or Events of Default

  	
   

  	
  65

  
	
  Section 10.06
  . Reports by Trustee to Holders

  	
   

  	
  65

  
	
  Section 10.07
  . Compensation and Indemnity

  	
   

  	
  65

  
	
  Section 10.08
  . Replacement of Trustee

  	
   

  	
  66

  
	
  Section 10.09 . Successor Trustee by Merger, etc.

  	
   

  	
  67

  
	
  Section 10.10
  . Eligibility; Disqualification

  	
   

  	
  67

  
	
  Section 10.11
  . Preferential Collection of Claims Against Company

  	
   

  	
  67

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  11

  
	
  SATISFACTION AND DISCHARGE

  
	
   

  
	
  Section 11.01
  . Satisfaction and Discharge

  	
   

  	
  67

  
	
  Section 11.02
  . Application of Trust Money

  	
   

  	
  68

  
	
  Section 11.03
  . Repayment to Company

  	
   

  	
  68

  
	
  Section 11.04
  . Reinstatement

  	
   

  	
  69

  



 


iv

















 


	
  ARTICLE
  12

  
	
  AMENDMENTS, SUPPLEMENTS AND WAIVERS

  
	
   

  
	
  Section 12.01
  . Without Consent of Holders

  	
   

  	
  69

  
	
  Section 12.02
  . With Consent of Holders

  	
   

  	
  70

  
	
  Section 12.03
  . Compliance with Trust Indenture Act

  	
   

  	
  71

  
	
  Section 12.04
  . Revocation and Effect of Consents

  	
   

  	
  71

  
	
  Section 12.05
  . Notation on or Exchange of Securities

  	
   

  	
  71

  
	
  Section 12.06 . Trustee to Sign Amendments, etc.

  	
   

  	
  71

  
	
  Section 12.07
  . Effect of Supplemental Indentures

  	
   

  	
  72

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  13

  
	
  MISCELLANEOUS

  
	
   

  
	
  Section 13.01
  . Trust Indenture Act Controls

  	
   

  	
  72

  
	
  Section 13.02
  . Notices

  	
   

  	
  72

  
	
  Section 13.03
  . Communications by Holders with Other Holders

  	
   

  	
  73

  
	
  Section 13.04
  . Certificate and Opinion as to Conditions
  Precedent

  	
   

  	
  73

  
	
  Section 13.05
  . Record Date for Vote or Consent of Holders

  	
   

  	
  74

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

  	
   

  	
  74

  
	
  Section 13.07
  . Payment Day or Record Date Not A Business Day

  	
   

  	
  74

  
	
  Section 13.08
  . Governing Law

  	
   

  	
  74

  
	
  Section 13.09
  . No Adverse Interpretation of Other Agreements

  	
   

  	
  74

  
	
  Section 13.10
  . No Recourse against Others

  	
   

  	
  75

  
	
  Section 13.11
  . Successors

  	
   

  	
  75

  
	
  Section 13.12
  . Multiple Counterparts

  	
   

  	
  75

  
	
  Section 13.13
  . Separability

  	
   

  	
  75

  
	
  Section 13.14 . Table of Contents, Headings, etc.

  	
   

  	
  75

  
	
  Section 13.15 . Submission to Jurisdiction

  	
   

  	
  75

  
	
   

  	
   

  	
   

  
	
  Exhibit A

  	
   

  	
  A-1

  



 


v

















 


CROSS-REFERENCE TABLE


 


	
  TIA 

  SECTION

  	
   

  	
  INDENTURE

  SECTION

  
	
  Section

  	
   

  	
  310(a)(1)

  	
   

  	
  10.10

  
	
   

  	
   

  	
  (a)(2)

  	
   

  	
  10.10

  
	
   

  	
   

  	
  (a)(3)

  	
   

  	
  N.A.**

  
	
   

  	
   

  	
  (a)(4)

  	
   

  	
  N.A.

  
	
   

  	
   

  	
  (a)(5)

  	
   

  	
  10.10

  
	
   

  	
   

  	
  (b)

  	
   

  	
  10.08;
  10.10

  
	
   

  	
   

  	
  (c)

  	
   

  	
  N.A.

  
	
  Section

  	
   

  	
  311(a)

  	
   

  	
  10.11

  
	
   

  	
   

  	
  (b)

  	
   

  	
  10.11

  
	
   

  	
   

  	
  (c)

  	
   

  	
  N.A.

  
	
  Section

  	
   

  	
  312(a)

  	
   

  	
  2.05

  
	
   

  	
   

  	
  (b)

  	
   

  	
  13.03

  
	
   

  	
   

  	
  (c)

  	
   

  	
  13.03

  
	
  Section

  	
   

  	
  313(a)

  	
   

  	
  10.06

  
	
   

  	
   

  	
  (b)(1)

  	
   

  	
  N.A.

  
	
   

  	
   

  	
  (b)(2)

  	
   

  	
  10.06

  
	
   

  	
   

  	
  (c)

  	
   

  	
  10.06;
  13.02

  
	
   

  	
   

  	
  (d)

  	
   

  	
  10.06

  
	
  Section

  	
   

  	
  314(a)

  	
   

  	
  7.02;
  7.04; 13.02

  
	
   

  	
   

  	
  (b)

  	
   

  	
  N.A.

  
	
   

  	
   

  	
  (c)(1)

  	
   

  	
  13.04(a)

  
	
   

  	
   

  	
  (c)(2)

  	
   

  	
  13.04(a)

  
	
   

  	
   

  	
  (c)(3)

  	
   

  	
  N.A.

  
	
   

  	
   

  	
  (d)

  	
   

  	
  N.A.

  
	
   

  	
   

  	
  (e)

  	
   

  	
  13.04(b)

  
	
   

  	
   

  	
  (f)

  	
   

  	
  N.A.

  
	
  Section

  	
   

  	
  315(a)

  	
   

  	
  10.01(b)

  
	
   

  	
   

  	
  (b)

  	
   

  	
  10.05; 13.02

  
	
   

  	
   

  	
  (c)

  	
   

  	
  10.01(a)

  
	
   

  	
   

  	
  (d)

  	
   

  	
  10.01(c)

  
	
   

  	
   

  	
  (e)

  	
   

  	
  9.11

  
	
  Section

  	
   

  	
  316(a)(last
  sentence)

  	
   

  	
  2.09

  
	
   

  	
   

  	
  (a)(1)(A)

  	
   

  	
  9.05

  
	
   

  	
   

  	
  (a)(1)(B)

  	
   

  	
  9.04

  
	
   

  	
   

  	
  (a)(2)

  	
   

  	
  N.A.

  
	
   

  	
   

  	
  (b)

  	
   

  	
  9.07

  
	
   

  	
   

  	
  (c)

  	
   

  	
  13.05

  
	
  Section

  	
   

  	
  317(a)(1)

  	
   

  	
  9.08

  
	
   

  	
   

  	
  (a)(2)

  	
   

  	
  9.09

  
	
   

  	
   

  	
  (b)

  	
   

  	
  2.04

  



 






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


**                                  N.A. means Not Applicable.


 


vi
















 


THIS INDENTURE dated as of May 27, 2009 is
between Cephalon, Inc., a corporation duly organized under the laws of the
State of Delaware (the “Company”),
and U.S. Bank National Association, a national banking association organized
and existing under the laws of the United States, as Trustee (the “Trustee”).


 


In consideration of the premises and the acquisition
of the Securities by the Holders thereof, both parties agree as follows for the
benefit of the other and for the equal and ratable benefit of the registered
Holders of the Securities.


 


ARTICLE 1

DEFINITIONS AND INCORPORATION BY REFERENCE


 


Section 1.01.  Definitions.


 


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


 


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


 


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


 


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


 


“Business Day”
means any day other than a (x) Saturday, (y) Sunday or (z) day
on which state or federally chartered banking institutions in New York, New
York are not required to be open.


 


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


 


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


 


1

















 


“Certificated
Security” means a Security that is in substantially the form
attached hereto as Exhibit A and that does not include the
information or the schedule called for by footnotes 1 and 2 thereof.


 


“Closing
Sale Price” of the Common Stock
means, as of any date of determination, the closing per share sale price (or,
if no such closing sale price is reported on such day, the average of the bid
and asked prices or, if more than one in either case, the average of the
average bid and the average asked prices) at 4:00 p.m., New York time, on
such date as reported in composite transactions for the principal U.S.
securities exchange on which the Common Stock is traded or, if the Common Stock
is not listed on a U.S. national or regional securities exchange, as reported
by Pink OTC Markets Inc.


 


“Common Stock”
means the common stock of the Company, $0.01 par value, as it exists on the
date of this Indenture and any shares of any class or classes of capital stock
of the Company resulting from any reclassification or reclassifications thereof
and which have no preference in respect of dividends or of amounts payable in
the event of any voluntary or involuntary liquidation, dissolution or
winding-up of the Company and which are not subject to redemption by the
Company; provided, however, that,
if at any time there shall be more than one such resulting class, the shares of
each such class then so issuable on conversion of Securities shall be
substantially in the proportion which the total number of shares of such class
resulting from all such reclassifications bears to the total number of shares
of all such classes resulting from all such reclassifications.


 


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


 


“Conversion Rate”
means, as of any date, an amount equal to $1,000 divided by the then applicable
Conversion Price on such date.  As of the
date hereof and subject to adjustment pursuant to Section 5.06, the
Conversion Rate with respect to the Securities is 14.4928 shares of Common
Stock for each $1,000 principal amount of Securities.


 


“Conversion Value”
of a Security means, as of any date of determination, the product of the last
reported bid price of the Common Stock on that date multiplied by the
Conversion Rate of that Security on that date.


 


“Corporate Trust
Office” means the office of the Trustee at which at any time the
trust created by this Indenture shall be administered, which office at the date
of the execution of this Indenture is located at 225 Asylum Street, 23rd Floor,
Hartford, CT  06103, Attention:  Corporate Trust Services (Cephalon, Inc.
2.50% Convertible Senior Subordinated Notes due May 1, 2014), or at any
other time at such other address as the Trustee may designate from time to time
by notice to the Company.


 


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


 


2

















 


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


 


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


 


“Ex-Dividend Date”
means with respect to any issuance, dividend or distribution, the first date on
which the shares of Common Stock trade, regular way, on the relevant exchange
or in the relevant market for which the sale price was obtained without the
right to receive the issuance, dividend or distribution in question.


 


“Final Maturity
Date” means May 1, 2014.


 


“GAAP”
means generally accepted accounting principles in the United States of America
as in effect as of the date of this Indenture, including those set forth in (1) the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants, (2) the statements and
pronouncements of the Financial Accounting Standards Board, (3) such other
statements by such other entity as approved by a significant segment of the
accounting profession and (4) the rules and regulations of the SEC
governing the inclusion of financial statements (including pro forma financial
statements) in registration statements filed under the Securities Act and
periodic reports required to be filed pursuant to Section 13 of the
Exchange Act, including opinions and pronouncements in staff accounting
bulletins and other official written statements from the accounting staff of
the SEC expressing the views of the SEC therein.


 


“Global Security”
means a permanent Global Security that is in substantially the form attached
hereto as Exhibit A and that includes the information and schedule
called for by footnotes 1, 2 and 3 thereof and which is deposited with the
Depositary or its custodian and registered in the name of the Depositary or its
nominee.


 


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


 


“Indebtedness”
means, with respect to any Person, without duplication, (a) all
indebtedness, obligations and other liabilities (contingent or otherwise) of
such Person (i) for borrowed money (including obligations of such Person
in respect of overdrafts, foreign exchange 


 


3

















 


contracts, currency exchange agreements,
interest rate protection agreements and any loans or advances from banks,
whether or not evidenced by notes or similar instruments) or (ii) evidenced
by credit or loan agreements, bonds, debentures, notes or similar instruments
(whether or not the recourse of the lender is to the whole of the assets of
such Person or to only a portion thereof) (other than any account payable or
other accrued current liability or obligation incurred in the ordinary course
of business in connection with the obtaining of materials or services), (b) all
reimbursement obligations and other liabilities (contingent or otherwise) of
such Person with respect to letters of credit, bank guarantees or bankers’
acceptances, (c) all obligations and liabilities (contingent or otherwise)
of such Person (i) in respect of leases of such Person required, in
conformity with GAAP, to be accounted for as capitalized lease obligations on
the balance sheet of such Person (as determined by such Person, or the Company
in the case of any Subsidiary of the Company), or (ii) under any lease or
related document (including a purchase agreement, conditional sale or other
title retention agreement) in connection with the lease of real property or
improvements thereon (or any personal property included as part of any such
lease) which provides that such Person is contractually obligated to purchase
or cause a third party to purchase the leased property or pay an agreed upon
residual value of the leased property to the lessor (whether or not such lease
transaction is characterized as an operating lease or a capitalized lease in
accordance with GAAP), (d) all obligations (contingent or otherwise) of
such Person with respect to any interest rate or other swap, cap, floor or
collar agreement, hedge agreement, forward contract or other similar instrument
or agreement or foreign currency hedge, exchange, purchase or similar
instrument or agreement; (e) all direct or indirect guaranties, agreements
to be jointly liable or similar agreements by such Person in respect of, and
obligations or liabilities of such Person to purchase or otherwise acquire or
otherwise assure a creditor against loss in respect of, indebtedness, obligations
or liabilities of another Person of the kind described in clauses (a) through
(d), and (f) any and all deferrals, renewals, extensions, refinancings and
refundings of, or amendments, modifications or supplements to, any
indebtedness, obligation or liability of the kind described in clauses (a) through
(e).


 


“Indenture”
means this Indenture as amended or supplemented from time to time pursuant to
the terms of this Indenture.


 


“interest,”
in respect of the Securities, unless the context otherwise requires, refers to
interest payable on the Securities, including any additional interest that may
become payable pursuant to Section 9.02(b).


 


“Issue Date”
means May 27, 2009.


 


“Market Disruption
Event” means (1) a failure by the primary exchange or quotation
system on which the Common Stock trades or is quoted to open for trading during
its regular trading session or (2) the occurrence or existence for more
than one half hour period in the aggregate on any Scheduled Trading Day for the
Common Stock of any suspension or limitation imposed on trading (by reason of
movements in price exceeding limits permitted by The NASDAQ Global Select
Market or otherwise) in the Common Stock or in any options, contracts or future
contracts relating to the Common Stock, and such suspension or limitation
occurs or exists at any time before 1:00 p.m., New York City time, on such
day.


 


4

















 


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


 


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


 


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


 


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


 


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


 


 “Representative” means the (a) indenture
trustee or other trustee, agent or representative for any Senior Indebtedness
or (b) with respect to any Senior Indebtedness that does not have any such
trustee, agent or other representative, (i) in the case of such Senior
Indebtedness issued pursuant to an agreement providing for voting arrangements
as among the holders or owners of such Senior Indebtedness, any holder or owner
of such Senior Indebtedness acting with the consent of the required persons
necessary to bind such holders or owners of such Senior Indebtedness and (ii) in
the case of all other such Senior Indebtedness, the holder or owner of such
Senior Indebtedness.


 


“Scheduled Trading
Day” means any day that is scheduled to be a Trading Day.


 


“SEC”
means the Securities and Exchange Commission.


 


“Securities”
means the 2.50% Convertible Senior Subordinated Notes due May 1, 2014, or
any of them (each, a “Security”).


 


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


 


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


 


“Senior
Indebtedness” means the principal of, and premium, if any, interest
(including any interest accruing after the commencement of any bankruptcy or
similar proceeding, whether or not a claim for post-petition interest is
allowed as a claim in any such proceeding) and rent payable on or in connection
with, and all fees, costs, expenses and other amounts accrued or due 


 


5

















 


on or in connection with, Indebtedness of the
Company, whether secured or unsecured, absolute or contingent, due or to become
due, outstanding on the date of this Indenture or thereafter created, incurred,
assumed, guaranteed or in effect guaranteed by the Company (including all
deferrals, renewals, extensions or refundings of, or amendments, modifications
or supplements to, the foregoing), unless in the case of any particular
Indebtedness the instrument creating or evidencing the same or the assumption
or guarantee thereof expressly provides that such Indebtedness shall not be
senior in right of payment to the Securities or expressly provides that such
Indebtedness is “pari passu” or “junior” to the Securities.  Notwithstanding the foregoing, the term
Senior Indebtedness shall not include (i) any Indebtedness of the Company
to any Subsidiary of the Company (other than Indebtedness of the Company to
such Subsidiary arising by reason of guarantees by the Company of Indebtedness
of such Subsidiary to a Person that is not a Subsidiary of the Company) or (ii) Indebtedness
for trade payables or the deferred purchase price of assets or services
incurred in the ordinary course of business. 
If any payment made to any holder of any Senior Indebtedness or its
Representative with respect to such Senior Indebtedness is rescinded or must
otherwise be returned by such holder or Representative upon the insolvency,
bankruptcy or reorganization of the Company or otherwise, the reinstated
Indebtedness of the Company arising as a result of such rescission or return
shall constitute Senior Indebtedness effective as of the date of such
rescission or return.


 


“Significant
Subsidiary” means, in respect of any Person, a Subsidiary of such
Person that would constitute a “significant subsidiary” as such term is defined
under Rule 1-02 of Regulation S-X under the Securities Act and the
Exchange Act.


 


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


 


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


 


“Trading Day”
means any day during which (i) there is no Market Disruption Event and (ii) The
NASDAQ Global Select Market, or if the Common Stock is not listed on The NASDAQ
Global Select Market, the principal other U.S. national or regional securities
exchange on which the Common Stock is then listed is open for trading or, if
the Common Stock is not so listed, any Business Day.  A “Trading Day” only includes those days that
have a scheduled closing time of 4:00 p.m., New York City time, or the
then standard closing time for regular trading on the relevant exchange or
trading system.


 


6

















 


“Trading Price”
means, on any date of determination with respect to any Security, the average
of the secondary bid quotations per Security obtained by the Conversion Agent
for $5,000,000 principal amount of Securities at approximately 3:30 p.m.,
New York City time, on such determination date from three independent
nationally recognized securities dealers selected by the Company; provided that, if at least three such bids
cannot reasonably be obtained, but two such bids can reasonably be obtained,
then the average of these two bids shall be used; provided, further, that, if at least two such bids cannot
reasonably be obtained, but one such bid can reasonably be obtained, this one
bid shall be used.  If the Conversion
Agent cannot reasonably obtain at least one bid for $5,000,000 principal amount
of the Securities from an independent nationally recognized securities dealer,
then the Trading Price of such Securities on such determination date will be
deemed to be less than 98% of the Closing Sale Price of the Common Stock on
such Date multiplied by the then current Conversion Rate.


 


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


 


“Trust Officer”
means, with respect to the Trustee, any officer assigned to the Corporate Trust
Office and also, with respect to a particular matter, any other officer to whom
such matter is referred because of such officer’s knowledge of and familiarity
with the particular subject.


 


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


 


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


 


Section 1.02.  Other
Definitions.


 


	
  Term

  	
   

  	
  Defined in Section

  
	
  “Additional
  Shares”

  	
   

  	
  4.02(a)

  
	
  “Agent
  Members”

  	
   

  	
  2.01(b)

  
	
  “Bankruptcy
  Law”

  	
   

  	
  9.01

  
	
  “Change
  in Control”

  	
   

  	
  3.01(a)

  
	
  “Closing
  Sale Price Condition”

  	
   

  	
  5.01(a)

  
	
  “Company
  Order”

  	
   

  	
  2.02

  
	
  “Conversion Agent”

  	
   

  	
  2.03

  
	
  “Conversion Date”

  	
   

  	
  5.02

  
	
  “Conversion Notice”

  	
   

  	
  5.02

  
	
  “Conversion
  Obligation”

  	
   

  	
  5.02

  
	
  “Conversion
  Period”

  	
   

  	
  5.05(a)

  
	
  “Conversion Price”

  	
   

  	
  5.06

  



 


7

















 


	
  “Custodian”

  	
   

  	
  9.01

  
	
  “Daily
  Conversion Value”

  	
   

  	
  5.05(a)

  
	
  “Daily
  Settlement Amount”

  	
   

  	
  5.05(a)

  
	
  “Daily
  VWAP”

  	
   

  	
  5.05(a)

  
	
  “DTC”

  	
   

  	
  2.01(a)

  
	
  “Depositary”

  	
   

  	
  2.01(a)

  
	
  “Designated
  Institution”

  	
   

  	
  5.15

  
	
  “Effective
  Date”

  	
   

  	
  4.02(a)

  
	
  “Event
  of Default”

  	
   

  	
  9.01

  
	
  “Expiration Date”

  	
   

  	
  5.06(e)

  
	
  “Expiration
  Time”

  	
   

  	
  5.06(e)

  
	
  “Fundamental
  Change”

  	
   

  	
  3.01(a)

  
	
  “Fundamental
  Change Purchase Date”

  	
   

  	
  3.01(a)

  
	
  “Fundamental
  Change Purchase Notice”

  	
   

  	
  3.01(c)

  
	
  “Fundamental
  Change Purchase Price”

  	
   

  	
  3.01(a)

  
	
  “Legal
  Holiday”

  	
   

  	
  13.07

  
	
  “Instrument”

  	
   

  	
  9.01(g)

  
	
  “Interest
  Payment Date”

  	
   

  	
  4.01(a)

  
	
  “Make
  Whole Adjustment Event”

  	
   

  	
  4.02(a)

  
	
  “Make
  Whole Adjustment Event Period”

  	
   

  	
  4.02(a)

  
	
  “Merger
  Event”

  	
   

  	
  5.12

  
	
  “Paying
  Agent”

  	
   

  	
  2.03

  
	
  “Payment
  Blockage Notice”

  	
   

  	
  6.02

  
	
  “Primary
  Registrar”

  	
   

  	
  2.03

  
	
  “Principal
  Portion”

  	
   

  	
  5.05(a)

  
	
  “Reference
  Property”

  	
   

  	
  5.12(a)

  
	
  “Registrar”

  	
   

  	
  2.03

  
	
  “Record
  Date”

  	
   

  	
  4.01(a)

  
	
  “Senior
  Subordinated Indebtedness”

  	
   

  	
  6.01

  
	
  “Spin-Off”

  	
   

  	
  5.06(c)

  
	
  “Stock
  Price”

  	
   

  	
  4.02(a)

  
	
  “Subordinated
  Indebtedness”

  	
   

  	
  6.01

  
	
  “Termination
  of Trading”

  	
   

  	
  3.01(a)

  
	
  “Unissued
  Shares”

  	
   

  	
  3.01(a)

  
	
  “Valuation
  Period”

  	
   

  	
  5.06(c)

  
	
  “Weighted
  Average Consideration”

  	
   

  	
  5.12(c)

  



 


Section 1.03.  Trust
Indenture Act Provisions.


 


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


 


8

















 


“indenture securities” means the Securities;


 


“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 indenture securities means the Company or any
other obligor on the Securities.


 


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


 


Section 1.04.  Rules of
Construction.


 


Unless the context otherwise requires:


 


(A)          a
term has the meaning assigned to it herein;


 


(B)           an
accounting term not otherwise defined has the meaning assigned to it in accordance
with GAAP;


 


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


 


(D)          provisions
apply to successive events and transactions;


 


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


 


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


 


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


 


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


 


ARTICLE 2

THE SECURITIES


 


Section 2.01.  Form and
Dating.


 


The Securities and the corresponding Trustee’s
certificate of authentication shall be substantially in the respective forms
set forth in Exhibit A, which Exhibit is incorporated in and
made part of this Indenture.  The
Securities may have notations, legends or endorsements 


 


9

















 


required by law, stock exchange rule or
usage.  The Company shall provide any
such notations, legends or endorsements to the Trustee in writing.  The Securities shall be dated the date of
their authentication.


 


(a)   Global Securities.  Each Security shall be issued initially in
the form of one or more Global Securities, which shall be deposited on behalf
of the acquirers of the Securities represented thereby with the Trustee, at its
Corporate Trust Office, as custodian for the depositary, The Depository Trust
Company (“DTC”) (such depositary, or
any successor thereto, being hereinafter referred to as the “Depositary”), and registered in the name of
its nominee, Cede & Co., duly executed by the Company and
authenticated by the Trustee as hereinafter provided.  The aggregate principal amount of the Global
Securities may from time to time be increased or decreased by adjustments made
on the records of the Securities Custodian as hereinafter provided, subject in
each case to compliance with the Applicable Procedures.


 


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


 


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


 


(c)   Book-Entry Provisions.  The Company shall execute and the Trustee
shall, in accordance with this Section 2.01(c) and Section 2.02,
authenticate and deliver initially one or more Global Securities that (i) shall
be registered in the name of Cede & Co. or as otherwise instructed by
the Depositary, (ii) shall be delivered by the Trustee to the Depositary
or pursuant to the Depositary’s instructions and (iii) shall bear legends
substantially to the following effect:


 


“THIS SECURITY IS A GLOBAL SECURITY
WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED
IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF.


 


10
















 


UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO CEPHALON, INC. (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 SECURITY 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 SECURITY 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. 
THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A
PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE.”


 


Section 2.02.  Execution
and Authentication.


 


An
Officer shall sign the Securities for the Company by manual or facsimile
signature.  Typographic and other minor
errors or defects in any such facsimile signature shall not affect the validity
or enforceability of any Security that has been authenticated and delivered by
the Trustee.


 


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


 


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


 


The
Trustee shall authenticate and make available for delivery Securities for
original issue in the aggregate principal amount of up to $500,000,000 upon
receipt of a written order or orders of the Company signed by two Officers of
the Company (a “Company Order”); provided that additional Securities may be
issued in an unlimited aggregate principal amount so long as such Securities
are part of the same issue, within the meaning of Treasury Regulations Sections
1.1275-1(f) and 1.1275-2(k)(2), as the Securities initially issued
hereunder, and would be fungible with the Securities issued on the Issue Date
for purposes of the Securities Act, the Exchange Act and other applicable U.S.
securities laws.  If any additional
Securities are issued, the Securities issued on the Issue Date and such
additional Securities shall be treated as a single class for all purposes under
this Indenture and shall vote together as one class on all matters with 


 


11

















 


respect
to the Securities.  Each Company Order
shall specify the amount of Securities to be authenticated and the date on
which each original issue of Securities is to be authenticated.


 


The
Trustee shall authenticate the Securities issued on the Issue Date.  Thereafter, the Trustee may appoint an
authenticating agent acceptable to the Company to authenticate Securities.  An authenticating agent may authenticate
Securities whenever the Trustee may do so. 
Each reference in this Indenture to authentication by the Trustee
includes authentication by such agent. 
An authenticating agent shall have the same rights as the Trustee to
deal with the Company or an Affiliate of the Company.


 


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


 


If any
successor that has replaced the Company in accordance with Article 8 has
executed an indenture supplemental hereto with the Trustee pursuant to Section 5.12,
any of the Securities authenticated or delivered prior to such transaction may,
from time to time, at the request of such successor, be exchanged for other
Securities executed in the name of the such successor with such changes in
phraseology and form as may be appropriate, but otherwise identical to the
Securities surrendered for such exchange and of like principal amount; and the
Trustee, upon receipt of a Company Order of such successor, shall authenticate
and deliver Securities as specified in such order for the purpose of such
exchange.  If Securities shall at any
time be authenticated and delivered in any new name of such successor pursuant
to this provision of Section 2.02 in exchange or substitution for or upon
registration of transfer of any Securities, such successor, at the option of
the Holders but without expense to them, shall provide for the exchange of all
Securities then outstanding for Securities authenticated and delivered in such
new name.


 


Section 2.03.  Registrar,
Paying Agent and Conversion Agent.


 


The
Company shall maintain one or more offices or agencies where Securities may be
presented for registration of transfer or for exchange (each, a “Registrar”), one or more offices or
agencies where Securities may be presented for payment (each, a “Paying Agent”), one or more offices or
agencies where Securities may be presented for conversion (each, a “Conversion Agent”) and one or more offices
or agencies where notices and demands to or upon the Company in respect of the
Securities and this Indenture may be served. 
The Company will at all times maintain a Paying Agent, Conversion Agent,
Registrar and an office or agency where notices and demands to or upon the
Company in respect of the Securities and this Indenture may be served in the
Borough of Manhattan, The City of New York. 
One of the Registrars (the “Primary
Registrar”) shall keep a register of the Securities and of their
transfer and exchange.


 


The
Company shall enter into an appropriate agency agreement with any Agent not a
party to this Indenture.  The agreement
shall implement the provisions of this Indenture that relate to such Agent
(including any applicable terms of the TIA). 
The Company shall notify the Trustee of the name and address of any
Agent not a party to this Indenture.  If the
Company fails to maintain a Registrar, Paying Agent, Conversion Agent or agent
for service of notices and demands in any place required by this Indenture, or
fails to give the foregoing notice, the Trustee 


 


12

















 


shall
act as such.  The Company or any
Affiliate of the Company may act as Paying Agent (except for the purposes of Section 7.01
and Article 11); provided, that upon any proceeding under any Bankruptcy
Law with respect to the Company or any such Affiliate, if the Company or such
Affiliate is then acting as Paying Agent, the Trustee shall replace the Company
or such Affiliate, as applicable, as Paying Agent.


 


The
Company hereby initially designates the Trustee as Paying Agent, Registrar,
Custodian and Conversion Agent, and each of the Corporate Trust Office of the
Trustee and the office or agency of the Trustee in the Borough of Manhattan,
The City of New York (which shall initially be U.S. Bank Trust National
Association, an Affiliate of the Trustee), to be such office or agency of the
Company for each of the aforesaid purposes.


 


Section 2.04.  Paying Agent
to Hold Money in Trust.


 


Prior to
11:00 a.m., New York City time, on each due date of the principal of or
interest, if any, on, any Securities, the Company shall deposit with a Paying
Agent a sum sufficient to pay such principal or interest, if any, so becoming
due.  Subject to Section 6.02, a
Paying Agent shall hold in trust for the benefit of Holders or the Trustee all
money held by the Paying Agent for the payment of principal of, and interest,
if any, on, the Securities and shall notify the Trustee of any default by the
Company (or any other obligor on the Securities) in making any such
payment.  If the Company or an Affiliate
of the Company acts as Paying Agent, it shall, before 11:00 a.m., New York
City time, on each due date of the principal of, or interest, if any, on, any
Securities, segregate the money and hold it as a separate trust fund.  The Company at any time may require a Paying
Agent to pay all money held by it to the Trustee, and the Trustee may at any
time during the continuance of any default, upon written request to a Paying
Agent, require such Paying Agent to pay forthwith to the Trustee all sums so
held in trust by such Paying Agent.  Upon
doing so, the Paying Agent (other than the Company) shall have no further
liability for the money.


 


Section 2.05.  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.  If the Trustee is not the Primary Registrar,
the Company shall furnish to the Trustee on or before each semiannual 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.


 


Section 2.06.  Transfer and
Exchange.


 


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


 


13

















 


form
and, if applicable, a transfer certificate, each in the form included in Exhibit A,
and in form satisfactory to the Registrar duly executed by the Holder thereof
or its attorney duly authorized in writing. 
To permit registration of transfers and exchanges, upon surrender of any
Security for transfer or exchange at an office or agency maintained pursuant to
Section 2.03, the Company shall execute and the Trustee shall authenticate
Securities of a like aggregate principal amount at the Registrar’s
request.  Any exchange or transfer shall
be without charge, except that the Company or the Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto; provided
that this sentence shall not apply to any exchange pursuant to Section 2.10,
3.04, 5.02 (third paragraph) or 12.05.


 


None of
the Company, any Registrar or the Trustee shall be required to exchange or
register a transfer of any Securities or portions thereof in respect of which a
Fundamental Change Purchase Notice has been delivered and not withdrawn by the
Holder thereof (except, in the case of the purchase of a Security in part, the
portion thereof not to be purchased).


 


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


 


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


 


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


 


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


 


Section 2.07.  Replacement
Securities.


 


If any
mutilated Security is surrendered to the Company, a Registrar or the Trustee,
or the Company, a Registrar and the Trustee receive evidence to their
satisfaction of the destruction, loss or theft of any Security, and there is
delivered to the Company, the applicable Registrar and the Trustee such
security or indemnity as will be required by them to save each of them
harmless, then, in the absence of notice to the Company, such Registrar or the
Trustee that such Security has been acquired by a bona fide purchaser, the
Company shall execute, and upon its written request the Trustee shall
authenticate and deliver, in exchange for any such mutilated 


 


14

















 


Security
or in lieu of any such destroyed, lost or stolen Security, a new Security of
like tenor and principal amount, bearing a number not contemporaneously outstanding.


 


In case
any such mutilated, destroyed, lost or stolen Security has become or is about
to become due and payable, or is about to be purchased by the Company pursuant
to Article 3, the Company in its discretion may, instead of issuing a new
Security, pay or purchase such Security, as the case may be.


 


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


 


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


 


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


 


Section 2.08.  Outstanding
Securities.


 


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


 


If a
Security is replaced pursuant to Section 2.07, it ceases to be outstanding
unless the Company receives, subsequent to the new Security’s authentication,
proof satisfactory to the Company that the replaced Security is held by a bona
fide purchaser.


 


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


 


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


 


15

















 


Section 2.09.  Treasury
Securities.


 


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


 


Section 2.10.  Temporary
Securities.


 


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


 


Section 2.11. 
Cancellation.


 


The
Company at any time may deliver Securities to the Trustee for
cancellation.  The Registrar, the Paying
Agent and the Conversion Agent shall forward to the Trustee or its agent any
Securities surrendered to them for transfer, exchange, payment or
conversion.  The Trustee and no one else
shall cancel, in accordance with its standard procedures, all Securities
surrendered for transfer, exchange, payment, conversion or cancellation and
shall deliver the canceled Securities to the Company.  No Security shall be authenticated in
exchange for any Security cancelled pursuant to this Section 2.11.


 


The
Company may, to the extent permitted by law, purchase Securities in the open
market or by tender offer at any price or by private agreement.  Any Securities purchased or otherwise
acquired by the Company or any of its Subsidiaries prior to the Final Maturity
Date may, to the extent permitted by law, be reissued or resold or may, at the
option of the Company, be surrendered to the Trustee for cancellation.  Any Securities surrendered for cancellation
may not be reissued or resold and shall be promptly cancelled by the Trustee,
and the Company may not hold or resell such Securities or issue any new
Securities to replace any such Securities or any Securities that any Holder has
converted pursuant to Article 5.


 


Section 2.12.  Additional
Transfer Requirements.


 


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


 


16

















 


such
Security has been registered in the name of such Person.  Notwithstanding any other provisions of this
Indenture or the Securities, transfers of a Global Security, in whole or in
part, shall be made only in accordance with this Section 2.12.


 


(b)                       The provisions of clauses (i) through (v) below
shall apply only to Global Securities:


 


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


 


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


 


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


 


17

















 


(iv)                In the event of the occurrence of any of the events
specified in clause (i) above, the Company will promptly make available to
the Trustee a reasonable supply of Certificated Securities in definitive, fully
registered form, without interest coupons. 
If (A) an event described in Section 2.12(b)(i)(A) or (B) occurs
and definitive Certificated Securities are not issued promptly to all
beneficial owners or (B) the Registrar receives from a beneficial owner
instructions to obtain definitive Certificated Securities due to an event
described in Section 2.12(b)(i)(C) and definitive Certificated
Securities are not issued promptly to any such beneficial owner, the Company
expressly acknowledges, with respect to the right of any Holder to pursue a
remedy pursuant to Section 9.06 hereof, the right of any beneficial owner
of Securities to pursue such remedy with respect to the portion of the Global
Security that represents such beneficial owner’s Securities as if such
definitive certificated Securities had been issued.


 


(v)                   Notwithstanding any provision to the contrary in this
Indenture, so long as a Global Security remains outstanding and is held by or
on behalf of the Depositary, transfers of a Global Security, in whole or in
part, or of any beneficial interest therein, shall only be made in accordance
with Section 2.06, this Section 2.12 and the rules and
procedures of the Depositary for such Global Security to the extent applicable
to such transaction and as in effect from time to time.


 


Section 2.13.  CUSIP
Numbers.


 


The
Company in issuing the Securities may use one or more “CUSIP” numbers (if then
generally in use), and, if so, the Trustee shall use “CUSIP” numbers in notices
of purchase as a convenience to Holders; provided
that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Securities or as contained
in any notice of a purchase and that reliance may be placed only on the other
identification numbers printed on the Securities, and any such purchase shall
not be affected by any defect in or omission of such numbers.  The Company will promptly notify the Trustee
of any change in the “CUSIP” numbers.


 


ARTICLE 3

PURCHASES OF SECURITIES UPON FUNDAMENTAL CHANGE


 


Section 3.01.  Purchase of
Securities at Option of the Holder Upon Fundamental Change.


 


(a)                        If at any time that Securities remain outstanding there
shall occur a Fundamental Change, Securities shall be purchased by the Company
at the option of the Holders, as of a date, determined by the Company in its
sole discretion, that is not less than 20 Business Days and not more than 30
Business Days after the occurrence of the Fundamental Change (the “Fundamental Change Purchase Date”) at a
purchase price equal to 100% of the principal amount of the Securities to be
purchased, together with any accrued and unpaid interest to, but excluding, the
Fundamental Change Purchase Date (the “Fundamental
Change Purchase 


 


18

















 


Price”),
unless the Fundamental Change Purchase Date is after a Record Date and on or
prior to the related Interest Payment Date, in which case interest accrued to
the Interest Payment Date will be paid to Holders of the Securities as of the
preceding Record Date and the Fundamental Change Purchase Price payable to any
Holder surrendering such Holder’s Security for purchase pursuant to this Article 3
shall be equal to the principal amount of Securities subject to purchase and
will not include any accrued and unpaid interest.  The Fundamental Change Purchase Price shall
be payable in cash, subject to satisfaction by or on behalf of any Holder of
the requirements set forth in subsection (c) of this Section 3.01.  Notwithstanding the foregoing, the Company
may not repurchase the Securities upon the occurrence of a Fundamental Change
if the principal amount of the Securities has been accelerated and such
acceleration has not been rescinded on or prior to the Fundamental Change
Purchase Date.


 


A “Fundamental Change” shall mean the
occurrence of a Change in Control or a Termination of Trading.


 


A “Change in Control” shall be deemed to have
occurred if any of the following occurs after the date hereof:


 


(i)                       any “person” or “group” (as such terms are defined below)
is or becomes the “beneficial owner” (as defined below), directly or
indirectly, of shares of Voting Stock of the Company representing 50% or more
of the total voting power of all outstanding classes of Voting Stock of the
Company or has the power, directly or indirectly, to elect a majority of the
members of the Board of Directors;


 


(ii)                    the Company consolidates with, enters into a binding share
exchange with, or merges with or into, another Person or the Company sells,
assigns, conveys, transfers, leases or otherwise disposes of all or
substantially all of the assets of the Company, or any Person consolidates
with, or merges with or into, the Company, in any such event other than
pursuant to a transaction (A) in which the Persons that “beneficially
owned” (as defined below), directly or indirectly, shares of Voting Stock of
the Company immediately prior to such transaction “beneficially own” (as
defined below), directly or indirectly, shares of Voting Stock of the Company
representing at least a majority of the total voting power of all outstanding
classes of Voting Stock of the surviving or transferee Person, with such
Holders’ proportional voting power immediately after such transaction vis-à-vis
each other with respect to the securities they receive in such transaction
being in substantially the same proportions as their respective voting power
vis-à-vis each other immediately prior to such transaction, or (B) which
is effected solely to change the jurisdiction of incorporation of the Company
and results in a reclassification, conversion or exchange of outstanding shares
of Common Stock solely into shares of common stock of the surviving Person; or


 


(iii)                 the holders of capital stock of the Company approve any
plan or proposal for the liquidation or dissolution of the Company (whether or
not otherwise in compliance with the terms of this Indenture).


 


19
















 


For the
purpose of the definition of “Change in
Control”, (i) “person” and “group” have the meanings given such
terms under Section 13(d) and 14(d) of the Exchange Act or any
successor provision to either of the foregoing, and the term “group” includes
any group acting for the purpose of acquiring, holding, voting or disposing of
securities within the meaning of Rule 13d-5(b)(1) under the Exchange
Act (or any successor provision thereto), (ii) a “beneficial owner” shall
be determined in accordance with Rule 13d-3 under the Exchange Act, as in
effect on the date of this Indenture, except that the number of shares of
Voting Stock of the Company shall be deemed to include, in addition to all
outstanding shares of Voting Stock of the Company and Unissued Shares deemed to
be held by the “person” or “group” (as such terms are defined above) or other
Person with respect to which the Change in Control determination is being made,
all Unissued Shares deemed to be held by all other Persons, and (iii) the
terms “beneficially owned” and “beneficially own” shall have meanings
correlative to that of “beneficial owner.” 
The term “Unissued Shares”
means shares of Voting Stock not outstanding that are subject to options,
warrants, rights to purchase or conversion privileges exercisable within 60
days of the date of determination of a Change in Control.


 


Notwithstanding
anything to the contrary set forth in this Section 3.01, Holders shall not
have the right to require the Company to purchase any Securities under clauses (i) and
(ii) above, and the Company shall not be required to deliver a written
notice of a Fundamental Change incidental thereto as a result of any
acquisition, consolidation, merger or binding share exchange or a sale,
assignment, conveyance, transfer, lease or other disposition if at least 90% of
the consideration (excluding cash payments for fractional shares and cash
payments pursuant to dissenters’ appraisal rights) paid for the Common Stock in
such transaction or transactions consists of shares of common stock traded on
the New York Stock Exchange, The NASDAQ Global Select Market or The NASDAQ
Global Market (or any of their respective successors) (or which will be so
traded immediately following the transaction or transactions) and as a result
of such transaction or transactions the Securities become convertible into such
shares of such common stock.


 


A “Termination of Trading” means that the
Common Stock or other securities into which the Securities are convertible are
not approved for listing the New York Stock Exchange, The NASDAQ Global Select
Market or The NASDAQ Global Market (or any of their respective successors).


 


If any transaction in which the
Common Stock is replaced by the securities of another entity occurs, following
completion of any related Make Whole Adjustment Event Period and any related
Fundamental Change Purchase Date, references to the Company in the definitions
of “Fundamental Change,” “Change of Control” and “Termination of Trading” above
shall apply to such other entity instead.


 


(b)                       Within 10 Business Days after the occurrence of a
Fundamental Change, the Company shall mail a written notice of the Fundamental
Change to the Trustee and to each Holder (and to beneficial owners as required
by applicable law).  The Company shall
also issue a press release announcing the occurrence of such Fundamental Change
(and make such press 


 


20

















 


release
available on the Company’s website).  The
notice shall include the form of a Fundamental Change Purchase Notice to be
completed by the Holder and shall state:


 


                                      (i)                          briefly,
the events causing such Fundamental Change;


 


                                     (ii)                          the
effective date of such Fundamental Change;


 


                                    (iii)                          whether
the Fundamental Change constitutes a Make Whole Adjustment Event and, if so,
the Effective Date of such Make Whole Adjustment Event;


 


                                    (iv)                        briefly,
the conversion rights of the Securities, the Conversion Price and any
adjustments thereto;


 


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


 


                                    (vi)                        the
Fundamental Change Purchase Date;


 


                                   (vii)                        the
Fundamental Change Purchase Price;


 


                                  (viii)                        the
date by which the Fundamental Change Purchase Notice pursuant to this
Section 3.01 must be given;


 


                                    (ix)                          that
Securities as to which a Fundamental Change Purchase Notice has been given may
be converted into Cash and Common Stock (if any) pursuant to Article 5 of
this Indenture only to the extent that the Fundamental Change Purchase Notice
has been withdrawn in accordance with the terms of this Indenture;


 


                                     (x)                          the
procedures that the Holder must follow to exercise rights under this
Section 3.01;


 


                                    (xi)                          the
procedures for withdrawing a Fundamental Change Purchase Notice, including a
form of notice of withdrawal;


 


                                   (xii)                          that
the Holder must satisfy the requirements set forth in the Securities in order
to convert the Securities; and


 


                                  (xiii)                          the
name and address of each Paying Agent and Conversion Agent.


 


If any of
the Securities is in the form of a Global Security, then the Company shall modify
such notice to the extent necessary to accord with the procedures of the
Depositary applicable to the repurchase of Global Securities.


 


(c)                        A Holder may exercise its rights specified in subsection (a) of
this Section 3.01 upon delivery of a written notice (which shall be in
substantially the form included in Exhibit A hereto and which may
be delivered by letter, overnight courier, hand delivery, facsimile
transmission or in any other written form and, in the case of Global
Securities, may (or, if definitive Certificated Securities have not been
issued, shall) be delivered electronically or by 


 


21

















 


other
means in accordance with the Depositary’s customary procedures) of the exercise
of such rights (a “Fundamental Change
Purchase Notice”) to any Paying Agent at any time during the period
between the date on which notice is given of the Fundamental Change and the
close of business on the second Scheduled Trading Day immediately preceding the
Fundamental Change Purchase Date.  The
Fundamental Change Purchase Notice must specify the Securities for which the
purchase right is being exercised.


 


The
delivery of such Security to any Paying Agent (together with all necessary
endorsements) at the office of such Paying Agent shall be a condition to the
receipt by the Holder of the Fundamental Change Purchase Price therefor.


 


The
Company shall purchase from the Holder thereof, pursuant to this Section 3.01,
a portion of a Security if the principal amount of such portion is $1,000 or an
integral multiple of $1,000.  Provisions
of this Indenture that apply to the purchase of all of a Security pursuant to Section 3.01
through Section 3.04 also apply to the purchase of such portion of such
Security.


 


Notwithstanding
anything herein to the contrary, any Holder delivering to a Paying Agent the
Fundamental Change Purchase Notice contemplated by this subsection (c) shall
have the right to withdraw such Fundamental Change Purchase Notice in whole or
in a portion thereof that is a principal amount of $1,000 or in an integral
multiple thereof at any time prior to 5:00 p.m., New York City time, on
the second Scheduled Trading Day immediately preceding the Fundamental Change
Purchase Date by delivery of a written notice of withdrawal to the Paying Agent
in accordance with Section 3.02.


 


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


 


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


 


Section 3.02.  Effect of
Fundamental Change Purchase Notice.


 


Upon
receipt by any Paying Agent of the Fundamental Change Purchase Notice specified
in Section 3.01(c), the Holder of the Security in respect of which such
Fundamental Change Purchase Notice was given shall (unless such Fundamental
Change Purchase Notice is withdrawn as specified below) thereafter be entitled
to receive the Fundamental Change Purchase Price with respect to such
Security.  Such Fundamental Change
Purchase Price shall be paid to such Holder promptly following the later of (a) the
Fundamental Change Purchase Date with respect to such Security (provided the conditions in Section 3.01(c) have
been satisfied) and (b) the time of delivery of such Security to a Paying
Agent by the Holder thereof in the manner required by Section 3.01(c).  Securities in respect of which a Fundamental
Change Purchase Notice has been given by the Holder thereof may not be
converted into shares of Common Stock pursuant to Article 5 on or after
the date of the delivery of such Fundamental Change Purchase Notice unless such
Fundamental Change Purchase Notice has first been validly withdrawn.


 


22

















 


A
Fundamental Change Purchase Notice may be withdrawn by means of a written
notice (which may be delivered by mail, overnight courier, hand delivery,
facsimile transmission or in any other written form and, in the case of Global
Securities, may be delivered electronically or by other means in accordance
with the Depositary’s customary procedures) of withdrawal delivered by the
Holder to a Paying Agent at any time prior to 5:00 p.m., New York City
time, on the second Scheduled Trading Day immediately preceding the Fundamental
Change Purchase Date, specifying the principal amount of the Security or
portion thereof (which must be a principal amount of $1,000 or an integral
multiple of $1,000 in excess thereof) with respect to which such notice of
withdrawal is being submitted.


 


Section 3.03.  Deposit of
Fundamental Change Purchase Price.


 


On or before
11:00 a.m., New York City time, on the Fundamental Change Purchase Date,
the Company shall deposit with the Trustee or with a Paying Agent (other than
the Company or an Affiliate of the Company) an amount of money (in immediately
available funds if deposited on such Fundamental Change Purchase Date)
sufficient to pay the aggregate Fundamental Change Purchase Price of all the
Securities or portions thereof that are to be purchased as of such Fundamental
Change Purchase Date.  The manner in
which the deposit required by this Section 3.03 is made by the Company
shall be at the option of the Company; provided
that such deposit shall be made in a manner such that the Trustee or a Paying
Agent shall have immediately available funds on the Fundamental Change Purchase
Date.


 


If a
Paying Agent holds, in accordance with the terms hereof, money sufficient to
pay the Fundamental Change Purchase Price of any Security for which a
Fundamental Change Purchase Notice has been tendered and not withdrawn in
accordance with this Indenture, then, on the Fundamental Change Purchase Date, (i) such
Security will cease to be outstanding and interest will cease to accrue
(whether or not book-entry transfer of such Security is made or whether or not
such Security is delivered to the Paying Agent) and (ii) all other rights
of the Holder in respect thereof shall terminate (other than the right to
receive the Fundamental Change Purchase Price and previously accrued and unpaid
interest as aforesaid).  The Company
shall publicly announce the principal amount of Securities purchased as a
result of such Fundamental Change on or as soon as practicable after the
Fundamental Change Purchase Date.


 


To the
extent that the aggregate amount of cash deposited by the Company pursuant to
this Section 3.03 exceeds the aggregate Fundamental Change Purchase Price
of the Securities or portions thereof that the Company is obligated to
purchase, then promptly after the Fundamental Change Purchase Date the Trustee
or a Paying Agent, as the case may be, shall return any such excess cash to the
Company.


 


Section 3.04.  Securities
Purchased in Part.


 


Any
Security that is to be purchased only in part shall be surrendered at the
office of a Paying Agent, and promptly after the Fundamental Change Purchase
Date the Company shall execute and the Trustee shall authenticate and deliver
to the Holder of such Security, without service charge, a new Security or
Securities, of such authorized denomination or denominations 


 


23

















 


as
may be requested by such Holder, in aggregate principal amount equal to, and in
exchange for, the portion of the principal amount of the Security so
surrendered that is not purchased.


 


Section 3.05.  Compliance
with Securities Laws Upon Purchase of Securities.


 


In
connection with any offer to purchase or repurchase Securities under Section 3.01,
the Company shall (a) comply with Rule 13e-4, Rule 14e-1 and any
other tender offer rules under the Exchange Act, to the extent any such rules are
applicable, (b) file a Schedule TO (or any successor or similar schedule,
form or report), if required, under the Exchange Act and (c) otherwise
comply with all federal and state securities laws in connection with such offer
to purchase or repurchase Securities, all so as to permit the rights of the
Holders and obligations of the Company under Section 3.01 through Section 3.04
to be exercised in the time and in the manner specified therein.


 


ARTICLE 4

PAYMENT OF INTEREST AND MAKE WHOLE ADJUSTMENT EVENTS


 


Section 4.01. Interest Payments


 


(a)                        The Company shall pay interest on the Securities at a rate
of 2.50% per annum, payable semi-annually in arrears on May 1 and November 1
of each year (each, an “Interest Payment Date”),
or if any such day is not a Business Day, the immediately following Business
Day, commencing November 1, 2009. 
Interest on a Security shall be paid to the Holder of such Security at
the close of business on April 15 or October 15 (each, a “Record Date”), as the case may be, next
preceding the related Interest Payment Date, and shall be computed on the basis
of a 360-day year comprised of twelve 30-day months.  In the event of the maturity, conversion, or
purchase of a Security by the Company at the option of the Holder, interest
shall cease to accrue on such Security. 
The Company shall pay interest on the Final Maturity Date to Holders of
record of a Security on the Record Date immediately preceding the Final
Maturity Date regardless of whether such Holders convert their Securities.


 


(b)                       Upon conversion of a Security, (i) a Holder shall not
receive any cash payment of interest (unless such conversion occurs between a
Record Date and the Interest Payment Date to which it relates, in which case a
Holder that was the Holder on the Record Date will receive on the Interest
Payment Date accrued and unpaid interest) and the Conversion Rate shall not be
adjusted to account for accrued and unpaid interest and (ii) except as set
forth in clause (c) below, the Company’s delivery to a Holder of cash and
shares, if any, of Common Stock into which the Security is convertible shall be
deemed to satisfy its obligation to pay the principal amount of such Security
and accrued and unpaid interest, if any, to but not including the Conversion
Date with respect to such Security.  Any
accrued but unpaid interest shall be deemed to be paid in full upon conversion,
rather than cancelled, extinguished or forfeited.


 


(c)                        Securities surrendered for conversion by a Holder after the
close of business on any Record Date but prior to the next Interest Payment
Date must be accompanied by payment of an 


 


24

















 


amount
equal to the interest that will be payable on the Securities so converted on
such Record Date; provided,
however, that no such payment need be made (1) if the Company has
specified a Fundamental Change Purchase Date that is after a Record Date and on
or prior to the corresponding Interest Payment Date, (2) with respect to
any Securities surrendered for conversion following the Record Date for the
payment of interest immediately preceding the Final Maturity Date or (3) only
to the extent of overdue interest, if any overdue interest exists at the time
of conversion with respect to such Securities.


 


Section 4.02.  Increased
Conversion Rate Applicable to Certain Securities Surrendered in Connection with
Make Whole Adjustment Events.


 


(a)                        Notwithstanding anything herein to the contrary, in the
event a Holder elects to surrender its Securities for conversion in accordance
with Article 5, at any time from, and including, the Effective Date of a
Make Whole Adjustment Event to, and including, the close of business on the
second Scheduled Trading Day immediately preceding the related purchase date,
or (in the case of a Make Whole Adjustment Event that does not also constitute
a Fundamental Change) the 35th Scheduled Trading Day immediately following the
Effective Date of such Make Whole Adjustment Event (such period, the “Make Whole Adjustment Event Period”), the
Company will increase the Conversion Rate for the Securities surrendered for
conversion by a number of additional shares of Common Stock (the “Additional Shares”), as described in this Section 4.02.


 


As used herein, a “Make Whole Adjustment Event” means (i) any
Change in Control and (ii) any Termination of Trading; provided, however,
that an acquisition, consolidation, merger or binding share exchange or a sale,
assignment, conveyance, transfer, lease or other disposition otherwise
constituting a Change in Control will not constitute a Make Whole Adjustment
Event if at least 90% of the consideration (excluding cash payments for
fractional shares and cash payments pursuant to dissenters’ appraisal rights)
paid for the Common Stock in such transaction or transactions consists of
shares of common stock traded on the New York Stock Exchange, The NASDAQ Global
Select Market or The NASDAQ Global Market (or any of their respective
successors) (or which will be so traded immediately following the transaction
or transactions) and as a result of such transaction or transactions the
Securities become convertible into such shares of such common stock.


 


The number of Additional Shares by
which the Conversion Rate shall be increased for conversions in connection with
a Make Whole Adjustment Event shall be determined by reference to the table
below and is based on the date on which the Make Whole Adjustment Event occurs
or becomes effective (the “Effective Date”)
and  (1) the price paid or deemed
paid per share of Common Stock in the Change in Control in the case of a Make
Whole Adjustment Event described in clause (ii) of the definition of
Change in Control in Section 3.01, in the event that the Common Stock is
acquired for cash, or (2) the average of the Closing Sale Prices of the
Common Stock over the five consecutive Trading Day period ending on, and
including, the Trading Day immediately preceding the Effective Date of such
other Make Whole Adjustment Event, in the case of any other Make Whole
Adjustment Event (such amount determined under the first and second clause of
this sentence, as applicable, the “Stock
Price”).


 


25

















 


	
  Effective 

  	
   

  	
  Stock Price

  	
   

  
	
  Date

  	
   

  	
  $60.00

  	
   

  	
  $61.00

  	
   

  	
  $62.00

  	
   

  	
  $63.00

  	
   

  	
  $65.00

  	
   

  	
  $70.00

  	
   

  	
  $75.00

  	
   

  	
  $80.00

  	
   

  	
  $90.00

  	
   

  	
  $100.00

  	
   

  	
  $125.00

  	
   

  	
  $150.00

  	
   

  	
  $175.00

  	
   

  	
  $200.00

  	
   

  	
  $250.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  May 27, 2009

  	
   

  	
  2.1700

  	
   

  	
  2.0931

  	
   

  	
  2.0147

  	
   

  	
  1.9404

  	
   

  	
  1.8019

  	
   

  	
  1.5086

  	
   

  	
  1.2749

  	
   

  	
  1.0864

  	
   

  	
  0.8055

  	
   

  	
  0.6108

  	
   

  	
  0.3256

  	
   

  	
  0.1807

  	
   

  	
  0.0991

  	
   

  	
  0.0507

  	
   

  	
  0.0000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  May 1, 2010

  	
   

  	
  2.1700

  	
   

  	
  2.1700

  	
   

  	
  2.0835

  	
   

  	
  2.0000

  	
   

  	
  1.8459

  	
   

  	
  1.5215

  	
   

  	
  1.2670

  	
   

  	
  1.0646

  	
   

  	
  0.7695

  	
   

  	
  0.5710

  	
   

  	
  0.2928

  	
   

  	
  0.1582

  	
   

  	
  0.0848

  	
   

  	
  0.0420

  	
   

  	
  0.0000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  May 1, 2011

  	
   

  	
  2.1700

  	
   

  	
  2.1700

  	
   

  	
  2.1468

  	
   

  	
  2.0508

  	
   

  	
  1.8738

  	
   

  	
  1.5070

  	
   

  	
  1.2245

  	
   

  	
  1.0051

  	
   

  	
  0.6956

  	
   

  	
  0.4973

  	
   

  	
  0.2385

  	
   

  	
  0.1238

  	
   

  	
  0.0641

  	
   

  	
  0.0300

  	
   

  	
  0.0000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  May 1,
  2012

  	
   

  	
  2.1700

  	
   

  	
  2.1700

  	
   

  	
  2.1589

  	
   

  	
  2.0460

  	
   

  	
  1.8393

  	
   

  	
  1.4180

  	
   

  	
  1.1035

  	
   

  	
  0.8674

  	
   

  	
  0.5532

  	
   

  	
  0.3684

  	
   

  	
  0.1576

  	
   

  	
  0.0780

  	
   

  	
  0.0389

  	
   

  	
  0.0166

  	
   

  	
  0.0000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  May 1,
  2013

  	
   

  	
  2.1700

  	
   

  	
  2.0966

  	
   

  	
  1.9527

  	
   

  	
  1.8182

  	
   

  	
  1.5754

  	
   

  	
  1.0985

  	
   

  	
  0.7658

  	
   

  	
  0.5361

  	
   

  	
  0.2714

  	
   

  	
  0.1483

  	
   

  	
  0.0514

  	
   

  	
  0.0263

  	
   

  	
  0.0131

  	
   

  	
  0.0042

  	
   

  	
  0.0000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  May 1,
  2014

  	
   

  	
  2.1700

  	
   

  	
  1.8974

  	
   

  	
  1.6331

  	
   

  	
  1.3771

  	
   

  	
  0.8888

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  



 


If
the exact Stock Prices and Effective Dates are not set forth in the table,
then:  (i) if the Stock Price is
between two Stock Price amounts in the table or the Effective Date is between
two Effective Dates in the table, the Additional Shares to be issued upon
conversion of the Securities shall be determined by a straight-line
interpolation between the number of Additional Shares set forth for the higher
and lower Stock Price amounts and the two Effective Dates in the table, based
on a 365-day year; (ii) if the Stock Price exceeds $250.00 per share,
subject to adjustment as set forth herein, no Additional Shares shall be issued
upon conversion of the Securities; and (iii) if the Stock Price is less
than $60.00 per share, subject to adjustment as set forth herein, no Additional
Shares shall be issued upon conversion of the Securities.


 


Notwithstanding
the foregoing, in no event will the total number of shares of Common Stock
issuable upon conversion exceed 16.66 shares per $1,000 principal amount of
Securities, subject to adjustments for the same events for which the Conversion
Rate is adjusted and pursuant to the same adjustment factor applied in such
Conversion Rate adjustment pursuant to Section 5.06.


 


The
Company shall deliver the additional conversion consideration payable pursuant
to this Section 4.02 after the Effective Date of the applicable Make Whole
Adjustment Event, notwithstanding that the Settlement Date in respect of other
conversion consideration payable by the Company may occur earlier.  The Company shall deliver the portion of the
conversion consideration payable on account of the increase in the Conversion
Rate as soon as practicable, but in no event later than the third Business Day
after the later of:  (i) the date a
Holder surrenders its Security for conversion; (ii) the last Trading Day
in the applicable Conversion Period; and (iii) the Effective Date of the
Make Whole Adjustment Event.


 


As
soon as practicable after the Company determines the anticipated Effective Date
of any proposed Make Whole Adjustment Event, the Company shall mail to each
Holder, the Trustee and the Conversion Agent written notice of, and shall use
commercially reasonable efforts to give such notice not more than 70 Scheduled
Trading Days nor less than 35 Scheduled Trading Days in advance of such
anticipated Effective Date.  The Company
shall also issue a press release announcing the anticipated Effective Date (and
make such press release available on the Company’s website).  Each such notice and press release shall also
state that in 


 


26

















 


connection
with such Make Whole Adjustment Event, the Company shall increase, in
accordance herewith, the Conversion Rate applicable to Securities entitled to
such increase as provided herein (along with a description of how such increase
shall be calculated and the time periods during which Securities must be
surrendered in order to be entitled to such increase).


 


Section 4.03.  Adjustments
Relating to Make Whole Adjustment Event.


 


Whenever the Conversion Price shall
be adjusted from time to time by the Company pursuant to Section 5.06,
each Stock Price set forth in the table under the row titled “Stock Price” in
the table in Section 4.02(a) shall be adjusted in the same manner in
which, at the same time and for the same events for which, the Conversion Price
is to be so adjusted.  The Stock Prices
in the table in Section 4.02(a) will be adjusted by the same
adjustment factor applied to the Conversion Price pursuant to Section 5.06
and the number of additional shares by which the Conversion Rate will be
increased will be adjusted by the inverse of that adjustment factor.


 


ARTICLE 5

CONVERSION


 


Section 5.01.  Conversion
Privilege.


 


(a)                        Subject to the further provisions of this Article 5
and paragraph 6 of the Securities, a Holder of a Security may convert the
principal amount of such Security (or any portion thereof equal to $1,000 or
any integral multiple of $1,000 in excess thereof) into cash and shares of
Common Stock any time until the close of business on November 1, 2013, at
the Conversion Price then in effect, if, during any calendar quarter commencing
after September 30, 2009, the Closing Sale Price of the Common Stock, for
at least 20 Trading Days in the period of 30 consecutive Trading Days ending on
the last Trading Day of the calendar quarter immediately preceding the calendar
quarter in which the conversion occurs, is more than 130% of the Conversion
Price per share of Common Stock in effect on such last Trading Day (the “Closing Sale Price Condition”), subject to
the additional exceptions provided in Section 5.01(b).


 


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


 


A
Security in respect of which a Holder has delivered a Fundamental Change
Purchase Notice pursuant to Section 3.01(c) exercising the option of
such Holder to require the Company to purchase such Security may be converted
only if such Fundamental Change Purchase Notice is withdrawn by a written
notice of withdrawal delivered to a Paying Agent prior to 5:00 p.m., New
York City time, on the second Scheduled Trading Day immediately preceding the
Fundamental Change Purchase Date in accordance with Section 3.02.


 


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


 


(b)                       Even if the Closing Sale Price Condition is not satisfied,


 


27

















 


(i)                                     if, after any five consecutive Trading Day period in which
the Trading Price for the Securities for each such Trading Day was less than
98% of the Closing Sale Price of the Common Stock on such date multiplied by
the then current Conversion Rate, a Holder may surrender Securities for
conversion at any time during the following 10 Trading Days.  Upon request by the Trustee or any Holder or
beneficial owner of the Securities, the Conversion Agent shall, on behalf of
the Company, determine if the Securities are convertible pursuant to this Section 5.01(b)(i) and
will notify the Company and the Trustee accordingly.  The Conversion Agent shall have no obligation
to determine the Trading Price of the Securities unless the Company requests
such determination in writing, the Company has no obligation to make such
request unless the Trustee provides the Company with reasonable evidence that
the Trading Price of the Securities on any Trading Day would be less than 98%
of the product of the then-current Conversion Rate times the Closing Sale Price
of the Common Stock on such date, and the Trustee has no obligation to provide
such evidence unless directed by the Company or a Holder.  At such time, the Company shall instruct the
Conversion Agent to determine the Trading Price of the Securities beginning on
such Trading Day and on each of the next four Trading Days;


 


(ii)                                  in the event that the Company declares a dividend or
distribution to all or substantially all holders of Common Stock of:


 


(A)                          any rights, options or warrants entitling them to subscribe
for or purchase, for a period expiring within 60 days, shares of Common Stock
at a price per share less than the Closing Sale Price on the record date for
such dividend or distribution, or


 


(B)                            cash, debt securities (or other evidences of indebtedness)
or other assets (excluding dividends or distributions for which Conversion
Price adjustment is required to be made under Section 5.06(a) or Section 5.06(b) of
this Indenture), where the fair market value of such dividend or distribution
per share of Common Stock, as determined in this Indenture, together with all
other such dividends or distributions within the preceding twelve months, has a
per share value exceeding 10% of the Closing Sale Price of the Common Stock as
of the Trading Day immediately preceding the date of declaration for such
dividend or distribution,


 


then
the Securities may be surrendered for conversion beginning on the date the
Company gives notice to the Holders of such right, which notice shall be given
not less than 35 Scheduled Trading Days prior to the Ex-Dividend Date for such
dividend or distribution, until the earlier of the close of business on the
Business Day prior to the Ex-Dividend Date or until the Company announces that
such distribution will not take place;


 


(iii)                               upon the occurrence of a Fundamental Change with respect to
the Company, the Securities may be surrendered for conversion at any time from
or after the 


 


28

















 


effective time of the
Fundamental Change until the close of business on the second Scheduled Trading
Day immediately preceding the related Fundamental Change Purchase Date, or, if
there is no such Fundamental Change Purchase Date, the 35th Scheduled Trading
Day immediately following the effective date of the Fundamental Change;


 


(iv)                              if the Company is a party to a consolidation, merger or
binding share exchange or a sale, assignment, conveyance, transfer, lease or
other disposition of all or substantially all of its property and assets that
does not also constitute a Fundamental Change (including any event that would
be a Fundamental Change but for the existence of an exception specified in the
paragraph immediately preceding the definition of “Termination of Trading” in Section 3.01
hereof), in each case pursuant to which the Common Stock would be converted
into cash, securities or other property, the Securities may be surrendered
conversion at any time from or after the effective date of such transaction as
announced by the Company (with the Company using commercially reasonable
efforts to give such announcement at least 35 Scheduled Trading Days prior to
such anticipated effective date), until the close of business on the 35th
Scheduled Trading Day following the effective date of such transaction; and


 


(v)                                 at any time after November 1, 2013 and until the close
of business on the second Scheduled Trading Day immediately prior to the Final
Maturity Date, the Securities may be surrendered for conversion regardless of
whether any of the foregoing conditions has been satisfied.


 


Section 5.02.  Conversion
Procedure.


 


The right
to convert any Security may be exercised, (a) if such Security is
represented by a Global Security, by book-entry transfer to the Conversion
Agent (which initially shall be the Trustee) through the facilities of the
Depositary in accordance with the Applicable Procedures, and, if required, by
payment of any tax or duty, in accordance with Section 5.04, that may be
payable in respect of any transfer involving the issue or delivery of the
Common Stock in the name of Person other than the Holder of the Security, or (b) if
such Security is represented by a Certificated Security, by delivery of such
Security at the specified office of the Conversion Agent, accompanied by:  (i) a completed and duly signed
conversion notice, in the form as set forth on the reverse of Security attached
hereto as Exhibit A (a “Conversion
Notice”); (ii) if such Certificated Security has been lost,
stolen, destroyed or mutilated, a notice to the Conversion Agent in accordance
with Section 2.07 regarding the loss, theft, destruction or mutilation of
the Security; (iii) appropriate endorsements and transfer documents if
required by the Conversion Agent; and (iv) payment of any tax or duty, in
accordance with Section 5.04, which may be payable in respect of any
transfer involving the issue or delivery of the Common Stock in the name of a
Person other than the Holder of the Security. 
The “Conversion Date” shall
be the Business Day on which the Holder satisfies all of the requirements set
forth in the immediately preceding sentence; provided,
however, if a Holder surrenders
for conversion a Security at any time after the 30th Scheduled Trading Day
prior to the Final Maturity Date, the Conversion Date shall be deemed to be the
30th Trading Day immediately preceding such 


 


29

















 


Security’s
Final Maturity Date.  On the third
Business Day following the last day of the related Conversion Period, subject
to Section 5.05, the Company shall deliver to the Holder through a
Conversion Agent a certificate for the number of whole shares of Common Stock
issuable upon the conversion and cash in an amount payable upon conversion
(including cash in lieu of any fractional shares pursuant to Section 5.03).


 


The
person in whose name the Common Stock certificate is registered shall be deemed
to be a stockholder of record as of the last Trading Day of the related
Conversion Period; provided, however, that if the related Conversion
Date or such last Trading Day of the Conversion Period occurs on any date when
the stock transfer books of the Company shall be closed, such occurrence shall
not be effective to constitute the person or persons entitled to receive any
such shares of Common Stock due upon conversion as the record holder or holders
of such shares of Common Stock on such date, but such occurrence shall be
effective to constitute the person or persons entitled to receive such shares
of Common Stock as the record holder or holders thereof for all purposes at the
close of business on the next succeeding day on which such stock transfer books
are open.  Upon conversion of Securities,
such person shall no longer be a Holder.


 


Upon
surrender of a Security that is converted in part, the Company shall execute,
and the Trustee shall authenticate and deliver to the Holder, a new Security
equal in principal amount to the unconverted portion of the Security
surrendered.


 


No
Conversion Notice with respect to any Securities may be given by a Holder
thereof if such Holder has also delivered a Fundamental Change Purchase Notice
to the Company in respect of such Securities and not validly withdrawn such
Fundamental Change Purchase Notice in accordance with Section 3.01, unless
the Company defaults in the payment of the Fundamental Change Purchase Price.


 


Except as
provided below, the Company shall pay or deliver the cash and shares of Common
Stock, if any, payable or deliverable, as the case may be, upon conversion of a
Security (the “Conversion Obligation”),
through the Conversion Agent on the third Business Day immediately following
the last Trading Day of the Conversion Period; provided,
that if prior to the relevant Conversion Date, the Common Stock has been
replaced by Reference Property consisting solely of cash, pursuant to Section 5.12,
the Company shall pay such cash on the third Trading Day immediately following
the relevant Conversion Date. 
Notwithstanding the foregoing, if any information required to calculate
the Conversion Obligation is not available as of the applicable Settlement
Date, the Company will deliver the Conversion Obligation on the third Trading
Day after the earliest Trading Day on which such calculation can be made (but
in no event later than October 31, 2014). 
If application of the provisions described above would result in
settlement of a conversion during the 10 Trading Days immediately following the
effective date of a Fundamental Change, settlement will instead take place on
the 10th Trading Day following the relevant effective date. If any shares of
Common Stock are due to a converting Holder, the Company shall issue or cause
to be issued, and deliver to the Conversion Agent or to such Holder, or such
Holder’s nominee or nominees, certificates or a book-entry transfer through the
Depositary for the number of full shares of Common Stock to which such Holder
shall be entitled in satisfaction of such Conversion Obligation.


 


30
















 


Section 5.03.  Fractional
Shares.


 


The Company will not issue
fractional shares of Common Stock upon conversion of a Security.  Instead, the Company will pay cash in lieu of
fractional shares by multiplying the Daily VWAP of a full share of Common Stock
on the last Trading Day of such Conversion Period by the fractional amount and
rounding the product to the nearest whole cent. 
Whether fractional shares are issuable upon a conversion will be
determined on the basis of the aggregate principal amount of Securities that
the Holder is then converting into cash and shares of Common Stock, if any, and
the aggregate number of shares, if any, of Common Stock issuable upon such
conversion.


 


Section 5.04.  Taxes on
Conversion.


 


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


 


Section 5.05.  Settlement
Upon Conversion.


 


(a)                        Subject to Section 5.01, a Holder upon conversion will
receive, in respect of each $1,000 aggregate principal amount of such Holder’s
Securities being converted, cash in an amount equal to the sum of the Principal
Portions for each Trading Day during the relevant Conversion Period.  In addition, if the Daily Conversion Value
exceeds $40.00 on any Trading Day during the relevant Conversion Period, the
Company will also deliver shares of Common Stock in an amount equal to (i) the
excess of the Daily Conversion Value over $40.00 divided by (ii) the Daily
VWAP of the Common Stock on such Trading Day.


 


“Conversion Period”, with respect to any
Security, means the 25 consecutive Trading Day period beginning on and
including the third Trading Day immediately following the related Conversion
Date, except that if a Holder surrenders a Security for conversion at any time
after the 30th Scheduled Trading Day prior to the Final Maturity Date and until
the close of business on the second Scheduled Trading Day immediately preceding
the Final Maturity Date, then (i) the Holder will be deemed to have
surrendered such Security as of the 30th Trading Day immediately preceding the
Final Maturity Date, (ii) the Conversion Period for such Security will
commence on the 27th Trading Day immediately preceding the Final Maturity Date,
and (iii) the Settlement Date for the conversion of such Security will be
the Final Maturity Date (assuming no delay in settlement due to Market
Disruption Events).


 


“Daily Conversion Value” means, for each of
the 25 consecutive Trading Days during the Conversion Period, for each $1,000
aggregate principal amount of Securities, one-twenty-


 


31

















 


fifth
(1/25th) of the product of (i) the applicable Conversion Rate and (ii) the
Daily VWAP of the Common Stock (or other Reference Property, if applicable) on
such Trading Day.


 


“Daily Settlement Amount,” for each of the 25 consecutive
Trading Days during the relevant Conversion Period, for each $1,000 aggregate
principal amount of Securities will consist of:


 


(i)                                     cash equal to
the lesser of (a) $40.00 and (b) the Daily Conversion Value for such
Trading Day (the amount determined pursuant to this clause (i) being the “Principal Portion”); and


 


(ii)                                  to the extent
the Daily Conversion Value exceeds $40.00, a number of shares of Common Stock
equal to (a) the difference between the Daily Conversion Value and $40.00,
divided by (b) the Daily
VWAP of the Common Stock for such Trading Day.


 


“Daily
VWAP” for the Common Stock (or any security that is part of the
Reference Property into which the Common Stock has been converted, if
applicable), in respect of any Trading Day, means the per share volume-weighted
average price of the Common Stock (or other security) on The NASDAQ Global
Select Market (or other principal exchange on which such security is then
listed) as displayed under the heading “Bloomberg VWAP” on Bloomberg page “CEPH<equity>AQR”
(or its equivalent successor if such page is not available, or the
Bloomberg page for any security that is part of the Reference Property
into which the Common Stock has been converted, if applicable) in respect of
the period from the scheduled opening of trading until the scheduled close of
trading of the primary trading session on such Trading Day (or if such volume-weighted
average price is unavailable, the market value of one share of the Common Stock
on such Trading Day as determined by the Board of Directors in a commercially
reasonable manner, using a volume-weighted average price method, provided that in making such determination
the Board of Directors may rely conclusively on the determination of Daily VWAP
for such Trading Day made by an independent nationally recognized securities
dealer selected by the Board of Directors) and will be determined without regard
to after hours trading or any other trading outside of the regular trading
session.


 


(b)                       The Daily Settlement Amounts (if applicable) and the Daily
Conversion Values (if applicable) shall be determined by the Company promptly
following the last day of the Conversion Period.  Promptly after such determination of the
Daily Settlement Amounts or the Daily Conversion Values, as the case may be,
and the amount of cash deliverable in lieu of fractional shares (if any), the Company
shall notify the Trustee and the Conversion Agent of the Daily Settlement
Amounts or the Daily Conversion Values, as the case may be, and the amount of
cash deliverable in lieu of fractional shares of Common Stock.  The Trustee and the Conversion Agent shall
have no responsibility for any such determination.


 


(c)                        The Company shall, prior to the issuance of any Securities
hereunder, and from time to time as may be necessary, reserve at all times and
keep available, free from preemptive rights, out of its authorized but unissued
Common Stock, a sufficient number of shares of Common Stock deliverable upon
conversion of all of the Securities.


 


32

















 


(d)                       All shares of Common Stock that may be issued upon conversion of
the Securities shall be newly issued shares, shall be duly authorized, validly
issued, fully paid and nonassessable and shall be free of any preemptive rights
and free of any lien or adverse claim.


 


(e)                        The Company shall endeavor to comply with all applicable
securities laws regulating the offer and delivery of any Common Stock upon
conversion of Securities and shall list or cause to have quoted such shares of
Common Stock on each national securities exchange, including The NASDAQ Global
Select Market, or over-the-counter market or such other market on which the
Common Stock is then listed or quoted; provided, however, that if the rules of
such automated quotation system or exchange permit the Company to defer the
listing of such Common Stock until the first conversion of the Securities into
Common Stock in accordance with the provisions of this Indenture, the Company
covenants to list such Common Stock issuable upon conversion of the Securities
in accordance with the requirements of such automated quotation system or
exchange at such time. Any Common Stock issued upon conversion of a Security
hereunder which at the time of conversion was a “restricted security” (as
defined in Rule 144 under the Securities Act) shall also be a restricted
security.


 


(f)                          Notwithstanding anything herein to the contrary, nothing herein
shall give to any Holder any rights as a creditor in respect of its right to
conversion.


 


Section 5.06.  Adjustment
of Conversion Price.


 


The conversion price as stated in
paragraph 6 of the Securities (the “Conversion
Price”) shall be adjusted from time to time by the Company as
follows:


 


(a)                        If the Company issues solely shares of Common Stock as a dividend
or distribution on all or substantially all of the shares of Common Stock, or
if the Company subdivides or combines the outstanding shares of Common Stock,
the applicable Conversion Price will be adjusted based on the following
formula:


 




	
  CP = CP0 ×

  	
  OS0

  
	
  OS

  






 


where


 


	
  CP0

  	
  =

  	
  the Conversion Price in effect
  immediately prior to the open of business on the Ex-Dividend Date for such dividend
  or distribution, or immediately prior to the open of business on the
  effective date of such subdivision or combination of Common Stock, as the
  case may be;

  
	
   

  	
   

  	
   

  
	
  CP

  	
  =

  	
  the Conversion Price in effect
  immediately after the open of business on the Ex-Dividend Date for such
  dividend or distribution, or immediately after the open of business on the
  effective date of such subdivision or combination of Common Stock, as the
  case may be;

  
	
   

  	
   

  	
   

  
	
  OS0

  	
  =

  	
  the number of shares of Common
  Stock outstanding immediately prior to the open of business on the
  Ex-Dividend Date for such dividend or 

  



 


33

















 


	
   

  	
   

  	
  distribution, or immediately
  prior to the open of business on the effective date of such subdivision or
  combination of Common Stock, as the case may be; and

  
	
   

  	
   

  	
   

  
	
  OS

  	
  =

  	
  the number of shares of Common
  Stock outstanding immediately after such dividend or distribution, or
  immediately after the effective date of such subdivision or combination of
  Common Stock, as the case may be.

  



 


Such adjustment shall become effective
immediately after the opening of business on the Ex-Dividend Date for such
dividend or distribution, or the effective date for such subdivision or
combination of Common Stock.  If any
dividend or distribution of the type described in this Section 5.06(a) is
declared but not so paid or made, or the outstanding shares of Common Stock are
not split or combined, as the case may be, the Conversion Price shall be
immediately readjusted, effective as of the date the Board of Directors
determines not to pay such dividend or distribution, or subdivide or combine
the outstanding shares of Common Stock, as the case may be, to the Conversion
Price that would then be in effect if such dividend, distribution, subdivision
or combination of Common Stock had not been declared or announced.


 


(b)                       If the Company distributes to all or substantially all holders of
its Common Stock any rights, options or warrants entitling them for a period of
not more than 60 calendar days from the record date for such distribution to
subscribe for or purchase shares of the Common Stock (or securities convertible
into Common Stock), at a price per share (or a conversion price per share) less
than the average of the Closing Sale Prices of the Common Stock for the 10
consecutive Trading Day period ending on, and including, the Trading Day
immediately preceding the Ex-Dividend Date for such distribution, the
Conversion Price shall be decreased based on the following formula:


 




	
  CP = CP0 ×

  	
  OS0 + Y

  
	
  OS0 + X

  






 


where


 


	
  CP0

  	
  =

  	
  the Conversion Price in effect
  immediately prior to the open of business on the Ex-Dividend Date for such
  distribution;

  
	
   

  	
   

  	
   

  
	
  CP

  	
  =

  	
  the Conversion Price in effect
  immediately after the open of business on the Ex-Dividend Date for such
  distribution;

  
	
   

  	
   

  	
   

  
	
  OS0

  	
  =

  	
  the number of shares of the
  Common Stock that are outstanding immediately prior to the open of business
  on the Ex-Dividend Date for such distribution;

  
	
   

  	
   

  	
   

  
	
  X

  	
  =

  	
  the total number of shares of the
  Common Stock issuable pursuant to such rights, options or warrants; and

  



 


34

















 


	
  Y

  	
  =

  	
  the number of shares of the
  Common Stock equal to the aggregate price payable to exercise such rights,
  options or warrants, divided by
  the average of the Closing Sale Prices of Common Stock over the 10
  consecutive Trading Day period ending on, and including, the Trading Day
  immediately preceding the Ex-Dividend Date relating to such distribution.

  



 


Such adjustment shall be
successively made whenever any such rights, options or warrants are distributed
and shall become effective immediately after the opening of business on the
Ex-Dividend Date for such distribution. 
To the extent that shares of the Common Stock are not delivered after
the expiration of such rights, options or warrants, the Conversion Price shall
be readjusted to the Conversion Price that would then be in effect had the
adjustments made upon the issuance of such rights, options or warrants been
made on the basis of delivery of only the number of shares of Common Stock actually
delivered.  If such rights, options or
warrants are not so issued, the Conversion Price shall again be adjusted to be
the Conversion Price that would then be in effect if such Ex-Dividend Date for
such distribution had not been fixed.


 


For purposes of this Section 5.06(b),
in determining whether any rights, options or warrants entitle the holders to
subscribe for or purchase shares of the Common Stock at less than the average
of the Closing Sale Prices of the Common Stock for each Trading Day in the applicable
10-consecutive Trading Day period, there shall be taken into account any
consideration received by the Company for such rights, options or warrants and
any amount payable on exercise or conversion thereof, the value of such
consideration, if other than cash, to be determined by the Board of
Directors.  In no event shall the
Conversion Price be increased pursuant to this Section 5.06(b).


 


(c)                        If the Company shall distribute shares of its Capital Stock,
evidences of its indebtedness or other of its assets or property to all or
substantially all holders of its Common Stock other than (i) dividends or
distributions (including subdivision of Common Stock) covered by Section 5.06(a) or
Section 5.06(b), (ii) dividends or distributions paid exclusively in cash
covered by Section 5.06(d), (iii) Spin-Offs to which the provisions
set forth below in this Section 5.06(c) shall apply, and (iv) distributions
of rights to all or substantially all holders of Common Stock pursuant to the
adoption of a shareholder rights plan, then, in each such case the Conversion
Price shall be decreased based on the following formula:


 




	
  CP = CP0 ×

  	
  SP0 - FMV

  
	
  SP0

  






 


where


 


	
  CP0

  	
  =

  	
  the Conversion Price in effect
  immediately prior to the open of business on the Ex-Dividend Date for such distribution;

  
	
   

  	
   

  	
   

  
	
  CP

  	
  =

  	
  the Conversion Price in effect
  immediately after the open of business on the Ex-Dividend Date for such
  distribution.

  
	
   

  	
   

  	
   

  
	
  SP0

  	
  =

  	
  the average of the Closing Sale
  Prices of the Common Stock over the 10 consecutive Trading Day period ending
  on, and including, the Trading

  



 


35

















 


	
   

  	
   

  	
  Day immediately preceding the
  Ex-Dividend Date for such distribution; and

  
	
   

  	
   

  	
   

  
	
  FMV

  	
  =

  	
  the fair market value (as
  determined by the Board of Directors) of the shares of Capital Stock,
  evidences of indebtedness, assets or property distributed with respect to
  each outstanding share of the Common Stock as of the open of business on the
  Ex-Dividend Date for such distribution.

  



 


If the
then-fair market value of the portion of the shares of Capital Stock, evidences
of indebtedness or other assets or property so distributed applicable to one
share of Common Stock is equal to or greater than the average of the Closing
Sale Prices of the Common Stock over the 10 consecutive Trading Day period
ending on the Trading Day immediately preceding the Ex-Dividend Date for such
distribution, in lieu of the foregoing adjustment, adequate provisions shall be
made so that each Holder of a Security shall have the right to receive on
conversion in respect of each Security held by such Holder, in addition to the
number of shares of Common Stock to which such Holder is entitled to receive,
the amount and kind of securities and assets such Holder would have received
had such Holder already owned a number of shares of Common Stock equal to the
Conversion Rate immediately prior to the record date for the distribution of
the securities or assets.


 


With
respect to an adjustment pursuant to this Section 5.06(c) where there
has been a dividend or other distribution on the Common Stock of shares of
Capital Stock of any class or series, or similar equity interest, of or
relating to a Subsidiary or other business unit of the Company (a “Spin-Off”), the Conversion Price will be
decreased based on the following formula:


 




	
  CP = CP0 ×

  	
  MP0

  
	
  FMV + MP0

  






 


where


 


	
  CP0

  	
  =

  	
  the Conversion Price in effect
  immediately prior to the open of business on the Ex-Dividend Date for the
  Spin-Off;

  
	
   

  	
   

  	
   

  
	
  CP

  	
  =

  	
  the Conversion Price in effect
  immediately after the open of business on the Ex-Dividend Date for the
  Spin-Off;

  
	
   

  	
   

  	
   

  
	
  FMV

  	
  =

  	
  the average of the Closing Sale
  Prices of the Capital Stock or similar equity interests distributed to
  holders of the Common Stock applicable to one share of the Common Stock over
  the first 10 consecutive Trading Day period immediately following, and
  including, the Ex-Dividend Date for the Spin-Off (such period, the “Valuation Period”), and

  
	
   

  	
   

  	
   

  
	
  MP0

  	
  =

  	
  the average of the Closing Sale
  Prices of the Common Stock over the Valuation Period.

  



 


36

















 


The
adjustment to the Conversion Price under the preceding paragraph of this Section 5.06(c) shall
be made immediately after the open of business on the day after the last day of
the Valuation Period, but shall become effective as of the open of business on
the Ex-Dividend Date for the Spin-Off. 
If the Ex-Dividend Date for the Spin-Off is less than 10 Trading Days
prior to, and including, the end of the Conversion Period in respect of any conversion,
references within this Section 5.06(c) to 10 Trading Days shall be
deemed replaced, for purposes of calculating the affected daily Conversion
Prices in respect of that conversion, with such lesser number of Trading Days
as have elapsed from, and including, the Ex-Dividend Date for the Spin-Off to,
and including, the last Trading Day of such Conversion Period.  For purposes of determining the Conversion
Price, in respect of any conversion during the 10 Trading Days commencing on
the Ex-Dividend Date of any Spin-Off, references in the portion of this Section 5.06(c) related
to Spin-Offs to 10 Trading Days shall be deemed replaced with such lesser
number of Trading Days as have elapsed from, and including, the Ex-Dividend
Date for such Spin-Off to, but excluding, the Conversion Date for such
conversion.


 


For purposes of this Section 5.06(c),
Section 5.06(a) and Section 5.06(b), any dividend or
distribution to which this Section 5.06(c) is applicable that also
includes shares of Common Stock, or rights, options or warrants to subscribe
for or purchase shares of Common Stock to which Section 5.06(a) or Section 5.06(b) applies
(or both), shall be deemed instead to be (1) a dividend or distribution of
the evidences of indebtedness, assets or shares of Capital Stock other than
such shares of Common Stock or rights, options or warrants to which this Section 5.06(c) applies
(and any Conversion Price adjustment required by this Section 5.06(c) with
respect to such dividend or distribution shall then be made) immediately
followed by (2) a dividend or distribution of such shares of Common Stock
or such rights, options or warrants (and any further Conversion Price
adjustment required by Section 5.06(a) and Section 5.06(b) with
respect to such dividend or distribution shall then be made), except (A) the
Ex-Dividend Date of such dividend or distribution shall be substituted as “the
Ex-Dividend Date,” “the Ex-Dividend Date relating to such distribution of such
rights, options or warrants” and “the Ex-Dividend Date for such distribution”
within the meaning of Section 5.06(a) and Section 5.06(b) and
(B) any shares of Common Stock included in such dividend or distribution
shall not be deemed “outstanding immediately prior to the Ex-Dividend Date for
such dividend or distribution, or the effective date of such share split or
share combination, as the case may be” within the meaning of Section 5.06(a) or
“outstanding immediately prior to the Ex-Dividend Date for such dividend or
distribution” within the meaning of Section 5.06(b).


 


In no event shall the Conversion Price be
increased pursuant to this Section 5.06(c).


 


(d)                       If the Company makes or pays any cash dividend or distribution to
all or substantially all holders of its outstanding Common Stock (other than
distributions pursuant to Section 5.06(e) and any dividend or
distribution in connection with the liquidation, dissolution or winding up on
the Company), the applicable Conversion Price shall be decreased based on the
following formula:


 


37

















 




	
  CP = CP0 ×

  	
  SP0 - C

  
	
  SP0

  






 


where


 


	
  CP0

  	
  =

  	
  the Conversion Price in effect
  immediately prior to the open of business on the Ex-Dividend Date for such
  dividend or distribution;

  
	
   

  	
   

  	
   

  
	
  CP

  	
  =

  	
  the Conversion Rate in effect
  immediately after the open of business on the Ex-Dividend Date for such
  dividend or distribution;

  
	
   

  	
   

  	
   

  
	
  SP0

  	
  =

  	
  the average of the Closing Sale
  Prices of the Common Stock over the 10 consecutive Trading Day period ending
  on, and including, the Trading Day immediately preceding the Ex-Dividend Date
  for such dividend or distribution; and

  
	
   

  	
   

  	
   

  
	
  C

  	
  =

  	
  the amount in cash per share the
  Company pays or distributes to holders of its Common Stock.

  



 


If any
dividend or distribution described in this Section 5.06(d) is
declared but 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.


 


For the
avoidance of doubt, for purposes of this Section 5.06(d), in the event of
any reclassification of the Common Stock, as a result of which the Securities
become convertible into more than one class of Common Stock, if an adjustment
to the Conversion Price is required pursuant to this Section 5.06(d),
references in this Section to one share of Common Stock or Closing Sale
Prices of one share of Common Stock shall be deemed to refer to a unit or to
the price of a unit consisting of the number of shares of each class of Common
Stock into which the Securities are then convertible equal to the number of
shares of such class issued in respect of one share of Common Stock in such
reclassification.  The above provisions
of this paragraph shall similarly apply to successive reclassifications.


 


In no
event shall the Conversion Price be increased pursuant to this Section 5.06(d).


 


(e)                        If the Company or any of its Subsidiaries makes a payment in
respect of a tender offer or exchange offer for the Common Stock and if the
cash and value of any other consideration included in the payment per share of
the Common Stock exceeds the average of the Closing Sale Prices of the Common
Stock over the 10 consecutive Trading-Day period commencing on, and including,
the Trading Day next succeeding the last date on which tenders or exchanges may
be made pursuant to such tender or exchange offer (the “Expiration Date”), the Conversion Price
shall be decreased based on the following formula:


 




	
  CP = CP0 ×

  	
  OS0 x SP

  
	
  AC + (OS x SP)

  






 


where


 


38

















 


	
  CP0

  	
  =

  	
  the Conversion Price in effect
  immediately prior to the open of business on the Trading Day next succeeding
  the Expiration Date;

  
	
   

  	
   

  	
   

  
	
  CP

  	
  =

  	
  the Conversion Price in effect
  immediately after the open of business on the Trading Day next succeeding the
  Expiration Date;

  
	
   

  	
   

  	
   

  
	
  AC

  	
  =

  	
  the aggregate value of all cash
  and any other consideration (as determined by the Board of Directors) paid or
  payable for shares of Common Stock purchased in such tender or exchange
  offer;

  
	
   

  	
   

  	
   

  
	
  OS0

  	
  =

  	
  the number of shares of Common
  Stock outstanding immediately prior to the time (the “Expiration Time”) such tender or exchange
  offer expires (prior to giving effect to such tender offer or exchange
  offer);

  
	
   

  	
   

  	
   

  
	
  OS

  	
  =

  	
  the number of shares of Common
  Stock outstanding immediately after the Expiration Time (after giving effect
  to such tender offer or exchange offer); and

  
	
   

  	
   

  	
   

  
	
  SP

  	
  =

  	
  the average of the Closing Sale
  Prices of Common Stock over the 10 consecutive Trading Day period commencing
  on, and including, the Trading Day next succeeding the Expiration Date.

  



 


Such adjustment under this Section 5.06(e) shall
become effective at the opening of business on the Trading Day next succeeding
the Expiration Date.  If the Trading Day
next succeeding the Expiration Date is less than 10 Trading Days prior to, and
including, the end of the Conversion Period in respect of any conversion,
references within this Section 5.06(e) to 10 Trading Days shall be
deemed replaced, for purposes of calculating the affected daily Conversion
Prices in respect of that conversion, with such lesser number of Trading Days
as have elapsed from, and including, the Trading Day next succeeding the
Expiration Date to, and including, the last Trading Day of such Conversion
Period.  For purposes of determining the
Conversion Price, in respect of any conversion during the 10 Trading Days
commencing on the Trading Day next succeeding the Expiration Date, references
within this Section 5.06(e) to 10 Trading Days shall be deemed
replaced with such lesser number of Trading Days as have elapsed from, and
including, the Trading Day next succeeding the Expiration Date to, but
excluding, the Conversion Date for such conversion.  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 or all or any
portion of such purchases or all such purchases are rescinded, the Conversion
Rate shall again be adjusted to be the Conversion Rate that would then be in
effect if such tender or exchange offer had not been made or had been made only
in respect of the purchases that had been effected.  In no event shall the Conversion Price be
increased pursuant to this Section 5.06(e).


 


(f)                          Notwithstanding this Section 5.06 or any other provision of
this Indenture or the Securities, if any Conversion Price adjustment becomes
effective, or any Ex-Dividend Date for any issuance, dividend or distribution
(relating to a required Conversion Price adjustment) occurs, during the period
beginning on, and including, the open of business on a Conversion


 


39

















 


Date
and ending on, and including, the close of business on the last Trading Day of
a related Conversion Period, the Board of Directors shall make adjustments to
the Conversion Price and the amount of cash or number of shares of Common Stock
issuable upon conversion of the Securities, as the case may be, as are
necessary or appropriate to effect the intent of this Section 5.06 and the
other provisions of this Article 5 and to avoid unjust or inequitable
results, as determined in good faith by the Board of Directors.  Any adjustment made pursuant to this Section 5.06(f) shall
apply in lieu of the adjustment or other term that would otherwise be
applicable.


 


(g)                       If, in respect of any Trading Day within the Conversion Period for
a converted Security:


 


(i)                                     any event that requires an adjustment to the Conversion Price
under any of clauses (a), (b), (c), (d) and (e) of this Section 5.06
has not resulted in an adjustment to the Conversion Price as of such Trading
Day; and


 


(ii)                                  the shares of Common Stock the Holder of such Security shall
receive in respect of such Trading Day are not entitled to participate in the
distribution or transaction giving rise to such adjustment event because,
pursuant to the terms of the second paragraph of Section 5.02, such shares
were not held by such Holder on the record date corresponding to such
distribution or transaction,


 


then the Company will adjust the number of
shares of Common Stock deliverable with respect to the Daily Settlement Amount
for such Trading Day to reflect the relevant distribution or transaction.


 


Section 5.07.  No
Adjustment.


 


All calculations and other determinations
under this Article 5 shall be made by the Company and shall be made to the
nearest one-ten thousandth (1/10,000) of a share.  No adjustment in the Conversion Price shall
be required unless the adjustment would require an increase or decrease of at
least 1% in the Conversion Price as last adjusted; provided, however, the Company shall carry forward any
adjustments that are less than 1% of the Conversion Rate and make such carried
forward adjustment, regardless of whether the aggregate adjustment is less than
1%, (i) upon any conversion of Securities, (ii) upon any required
repurchase of Securities in connection with a Fundamental Change, and (iii) on
each of the 27 Scheduled Trading Days immediately preceding the Final Maturity
Date.


 


Except as otherwise provided herein, no
adjustment need be made:


 


(a)                                  upon the issuance of any shares of the Common Stock pursuant to
any present or future plan providing for the reinvestment of dividends or
interest payable on the Company’s securities and the investment of additional
optional amounts in shares of the Common Stock under any plan;


 


40
















 


(b)                                upon the issuance of any shares of the Common Stock or options or
rights to purchase those shares pursuant to any present or future employee,
director or consultant benefit plan or program of, or assumed by, the Company
or any of the Company’s Subsidiaries;


 


(c)                                 upon the issuance of any shares of the Common Stock pursuant to
any option, warrant, right or exercisable, exchangeable or convertible security
not described in clause (b) of this subsection and outstanding as of the
date the Securities were first issued; or


 


(d)                                for accrued and unpaid interest, if any.


 


Except as set
forth in this Article 5, the Company shall not adjust the Conversion
Price.  The Company shall not be
obligated to adjust the Conversion Price in transactions in which Holders participate
without conversion of the Securities.


 


To the extent that the Securities become
convertible into the right to receive cash, no adjustment need be made
thereafter as to the cash.  Interest will
not accrue on the cash.


 


Section 5.08.  Adjustment
for Tax Purposes.


 


The Company shall be entitled to (but is
not required to) make such reductions in the Conversion Price, in addition to
those required by Section 5.06, as it in its discretion shall determine to
be advisable in order to avoid or diminish any tax to holders of Common Stock
(or holders of rights to purchase Common Stock) in connection with any stock
dividends, subdivisions of shares, distributions of rights to purchase stock or
securities or distributions of securities convertible into or exchangeable for
stock (or rights to acquire such securities) hereafter made by the Company to
its stockholders; provided the Company shall not take any action that
would result in an adjustment to the Conversion Price in such a manner as to
result in the reduction of the Conversion Price to less than the par value per
share of the Common Stock.


 


Section 5.09.  Notice of
Adjustment.


 


Whenever the Conversion Price or
conversion privilege is adjusted, the Company shall promptly mail to Holders a
notice of the adjustment and file with the Trustee and the Conversion Agent an
Officers’ Certificate setting forth the Conversion Price, detailing the
calculation of the Conversion Price and briefly stating the facts upon which
the adjustment is based.  In addition,
the Company will issue a press release containing such information and make
such press release available on its website.


 


Unless and until the Trustee shall receive
an Officers’ Certificate setting forth an adjustment of the Conversion Price,
the Trustee may assume without inquiry that the Conversion Price has not been
adjusted and that the last Conversion Price of which it has knowledge remains
in effect.


 


41

















 


Section 5.10.  Notice of
Certain Transactions.


 


In the event that:


 


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


 


(2)                                  the Company consolidates or merges with, or transfers all or
substantially all of its property and assets to, another corporation and
shareholders of the Company must approve the transaction; or


 


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


 


the Company shall mail to Holders and file
with the Trustee and the Conversion Agent a notice stating the proposed record
or effective date, as the case may be. 
The Company shall use commercially reasonable efforts to mail the notice
at least 30 Business Days before such date and, in any event, as promptly as
practicable thereafter and in no event less than 10 days prior to such
event.  Failure to mail such notice or
any defect therein shall not affect the validity of any transaction referred to
in clause (1), (2) or (3) of this Section 5.10.


 


Section 5.11.
Stockholder Rights Plans.


 


To the extent that the Company has a
stockholder rights plan or other “poison pill” in effect upon conversion of the
Securities, each share of Common Stock, if any, issued upon such conversion
shall be entitled to receive the appropriate number of rights, if any, and the
certificates representing the Common Stock issued upon such conversion shall
bear such legends, if any, in each case as may be provided by the terms of any
such stockholder rights plan or poison pill, as the same may be amended from
time to time.  If, however, prior to the
time of conversion, the rights provided by such stockholder rights plan or
poison pill have separated from the shares of Common Stock in accordance with
the provisions of the applicable stockholder rights agreement so that the
holders of the Securities would not be entitled to receive any rights in
respect of Common Stock, if any, issuable upon conversion of the Securities,
the Conversion Rate will be adjusted at the time of separation as if the
Company has distributed to all holders of Common Stock, shares of Capital Stock
of the Company, evidences of indebtedness or assets as provided in Section 5.04(c),
subject to readjustment in the event of the expiration, termination or
redemption of such rights.


 


Section 5.12. Effect of Reclassification, Consolidation, Merger
or Sale on Conversion Privilege.


 


If any of the following shall occur,
namely:  (i) any reclassification or
change of shares of Common Stock issuable upon conversion of the Securities
(other than a change in par value, or from par value to no par value, or from
no par value to par value, or as a result of a subdivision or combination, or
any other change for which an adjustment is provided in Section 5.06); (ii) any
consolidation, merger or binding share exchange involving the Company; or (iii) any
sale, assignment, conveyance, transfer, lease or other disposition to another
person of the Company’s property and assets as an entirety or substantially as
an entirety, in each case as a result of which


 


42

















 


holders of Common Stock shall be
entitled to receive cash, securities or other property with respect to or in
exchange for such Common Stock (any such event a “Merger Event”), then:


 


(a)                  the
Company, or such successor purchasing Person, as the case may be, shall, as a
condition precedent to such Merger Event, execute and deliver to the Trustee a
supplemental indenture (which shall comply with the TIA as in force at the date
of execution of such supplemental indenture if such supplemental indenture is
then required to so comply) providing that Holders shall be entitled thereafter
to convert their Securities into the type and amount of shares of stock, other
securities or other property or assets (including cash or any combination
thereof) that a holder of a number of shares of the Common Stock equal to the
Conversion Rate immediately prior to such Merger Event would have owned or been
entitled to receive (the “Reference Property”)
upon such Merger Event; provided
that, at and after the effective time of any such Merger Event, any amount otherwise
payable in cash upon conversion of the Securities shall continue to be payable
as provided in Section 5.05.


 


(b)                 In
the event the Company shall execute a supplemental indenture pursuant to this Section 5.12,
the Company shall promptly file with the Trustee (x) an Officers’
Certificate briefly describing the Merger Event, the kind or amount of shares
of stock or other securities or property (including cash) that will comprise
the Reference Property after any such Merger Event, any adjustment to be made
with respect thereto and stating that all conditions precedent have been
complied with and (y) an Opinion of Counsel that all conditions precedent
have been complied with.  Any failure to
deliver such Officers’ Certificate shall not affect the legality or validity of
such supplemental indenture.


 


(c)                  With
respect to each $1,000 principal amount of Securities surrendered for
conversion after the effective date of any such Merger Event in lieu of cash
and shares of Common Stock, if any, otherwise provided for hereunder, the
Company shall deliver to the converting Holder a number of units of Reference
Property (each such unit comprised of the kind and amount of shares of stock,
securities or other property or assets (including cash or any combination thereof)
that a holder of one share of Common Stock immediately prior to such Merger
Event would have owned or been entitled to receive based on the Weighted
Average Consideration) equal to (1) the aggregate principal amount of
Securities to be converted, divided by $1,000, multiplied by (2) the
then-applicable Conversion Rate.


 


(i)                                                    The Company will deliver the cash in lieu of fractional units of
Reference Property as set forth pursuant to Section 5.03 (provided that the amount of such cash
shall be determined as if references in such Section to “the Closing Sale
Price” were instead a reference to “the Closing Sale Price of a unit of
Reference Property” composed of the type and amount of shares of stock,
securities or other property or assets (including cash or any combination
thereof) that a holder of one share of Common Stock immediately prior to such
Merger Event would have owned or been entitled to receive based on the Weighted
Average Consideration).


 


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(ii)                                                 The Daily Settlement Amounts (if applicable) and Daily Conversion
Values (if applicable) shall be determined by the Company promptly following
the last day of the applicable Conversion Period.


 


(iii)                                              For purposes of this Section 5.12, the “Weighted Average Consideration” means the
weighted average of the types and amounts of consideration received by the
holders of the Common Stock entitled to receive cash, securities or other
property or assets with respect to or in exchange for such Common Stock in any
Merger Event who affirmatively make such an election; provided that, if the types and amounts of
consideration that holders of the Common Stock would be entitled to receive
with respect to or in exchange for such Common Stock is based in part upon any
form of stockholder election, the “Weighted Average Consideration” will be
deemed to be (A) if holders of the majority of the shares of Common Stock
affirmatively make such an election, the weighted average of the types and
amounts of consideration received by the holders of the Common Stock that
affirmatively make such an election or (B) if the holders of a majority of
the shares of Common Stock do not affirmatively make such an election, the
types and amount of consideration actually received by such holders.


 


(iv)                                             The Company shall notify the holders and the Trustee of the
Weighted Average Consideration as soon as practicable after the Weighted
Average Consideration is determined.


 


(v)                                                The above provisions of this Section shall similarly apply to
successive Merger Events.


 


Promptly
following the effective time of any such Merger Event, the Company shall notify
the Trustee and the Conversion Agent and issue a press release describing the
type or amount of cash, securities, property or other assets that will comprise
the Reference Property after any such Merger Event (and shall make the press
release available on its website).


 


Section 5.13.  Trustee’s
Disclaimer.


 


The Trustee and the Conversion Agent shall
have no duty to determine when an adjustment under this Article 5 should
be made, how it should be made or what such adjustment should be, but may
accept as conclusive evidence of that fact or the correctness of any such
adjustment, and shall be protected in relying upon, an Officers’ Certificate,
including the Officers’ Certificate with respect thereto which the Company is
obligated to file with the Trustee pursuant to Section 5.09.  Neither the Trustee nor the Conversion Agent
makes any representation as to the validity or value of any securities or
assets issued upon conversion of Securities, and the Trustee and the Conversion
Agent shall not be responsible for the Company’s failure to comply with any
provisions of this Article 5.


 


The Trustee shall not be under any
responsibility to determine the correctness of any provisions contained in any
supplemental indenture executed pursuant to Section 5.12, but may 


 


44

















 


accept as conclusive evidence of
the correctness thereof, and shall be fully protected in relying upon, the
Officers’ Certificate with respect thereto which the Company is obligated to
file with the Trustee pursuant to Section 5.12.


 


Section 5.14.  Voluntary Reduction.


 


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 Business Days and if the reduction is irrevocable during the period if
the Board of Directors determines that such reduction would be in the best
interest of the Company or to avoid or diminish income tax to holders of shares
of Common Stock or rights to purchase shares of Common Stock in connection with
a dividend or distribution of shares (or rights to acquire shares) or similar
event, and the Company provides at least 15 days’ prior notice of any reduction
in the Conversion Price; provided, however,
that in no event may the Company reduce the Conversion Price to be less than
the par value of a share of Common Stock.


 


Section 5.15.  Exchange in Lieu of Conversion.


 


When
a Holder surrenders its Securities for conversion, the Company may, at its
election, direct the Conversion Agent to surrender, on or prior to the second
Business Day following the relevant Conversion Date, such Securities to a
financial institution designated by the Company (the “Designated Institution”) for exchange in
lieu of conversion.  In order to accept
any Securities surrendered for conversion for exchange in lieu of conversion,
the Designated Institution must agree to timely deliver, in exchange for such
Securities, the cash and shares of Common Stock, if any, that would otherwise
be due upon conversion pursuant to Section 5.01 and in respect of which
the Company has notified converting Holders. 
If the Company makes the election provided for in this Section 5.15,
the Company shall, by the close of business on the second Business Day
following the relevant Conversion Date as part of its Settlement Notice, notify
the Holder surrendering its Securities for conversion that it has made such
election.  Any Securities exchanged by
the Designated Institution will remain outstanding.


 


If
the Designated Institution agrees to accept any Securities for exchange but
does not timely deliver the related consideration due upon conversion to the
Conversion Agent, or if the Designated Institution does not accept such
Securities for exchange, the Company shall, within the time period specified in
Section 5.02, pay or deliver the cash and shares of Common Stock, if any,
due upon such conversion in accordance with the provisions of Section 5.02.


 


For
the avoidance of doubt, in no event will the Company’s designation of a
Designated Institution pursuant to this Section 5.15 require the
Designated Institution to accept any Securities for exchange.


 


Section 5.16.  Compliance with NASDAQ Market Rule 4350.


 


The
Company shall not take any action that would result in an adjustment pursuant
to the provisions described in this Article 5 without complying with
NASDAQ Market Rule 4350, 


 


45

















 


requiring
stockholder approval of certain issuances of stock, or any similar rule of
any other stock exchange on which the Common Stock may be listed, if
applicable.


 


ARTICLE 6


SUBORDINATION


 


Section 6.01.  Agreement of
Subordination.


 


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


 


The payment of the principal of, any cash
portion of the Conversion Obligation in respect of, and interest on, all
Securities (including, but not limited to, the Fundamental Change Purchase Price
with respect to the Securities subject to purchase in accordance with Article 3
as provided in this Indenture) issued hereunder shall, to the extent and in the
manner hereinafter set forth, be subordinated and subject in right of payment
to the prior payment in full, in cash or other payment satisfactory to the
holders of Senior Indebtedness, of all Senior Indebtedness, whether outstanding
at the date of this Indenture or thereafter incurred. The Securities shall rank
senior to all Subordinated Indebtedness and equal in right of payment to all
Senior Subordinated Indebtedness.  “Senior Subordinated Indebtedness” means,
with respect to the Company, the Securities and any other Indebtedness that
specifically provides that such Indebtedness is to have the same rank as the
Securities in right of payment and is not subordinated by its terms in right of
payment to any Indebtedness of other obligations of the Company that is not
Senior Indebtedness, including, but not limited to, the Company’s 2.00%
Convertible Senior Subordinated Notes due June 1, 2015.  “Subordinated
Indebtedness” means, with respect to the Company, any Indebtedness
that provides pursuant to the terms of the instruments creating such
Indebtedness that such Indebtedness is subordinated to the Securities,
including, but not limited to, the Company’s Zero Coupon Convertible
Subordinated Notes due 2033, first putable 2010.


 


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


 


Section 6.02.  Payments to
Holders.


 


No payment shall be made with respect to
the principal of the cash portion of the Conversion Obligation, if any, or
interest on, the Securities (including, but not limited to, the Fundamental
Change Purchase Price with respect to the Securities subject to purchase in
accordance with Article 3 as provided in this Indenture), except payments
and distributions made by the Trustee as permitted by the first or second
paragraph of Section 6.05, if:


 


(i)             a
default in the payment of principal, interest, rent or other obligations due on
any Senior Indebtedness occurs and is continuing (or, in the case of Senior


 


46

















 


Indebtedness for which there is a period
of grace, in the event of such a default that continues beyond the period of
grace, if any, specified in the agreement, indenture, instrument, lease or
other document evidencing such Senior Indebtedness), unless and until such
default shall have been cured or waived or shall have ceased to exist; or


 


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


 


Subject to the provisions of Section 6.05,
if the Trustee receives any Payment Blockage Notice pursuant to clause (ii) above,
no subsequent Payment Blockage Notice shall be effective for purposes of this Section unless
and until at least 365 days shall have elapsed since the initial effectiveness
of the immediately prior Payment Blockage Notice and all scheduled payments on
the Securities that have come due have been paid in full in cash.  No nonpayment default that existed or was
continuing on the date of delivery of any Payment Blockage Notice to the
Trustee (unless such default was waived, cured or otherwise ceased to exist and
thereafter subsequently reoccurred) shall be, or be made, the basis for a
subsequent Payment Blockage Notice, unless such default shall have been cured
or waived for a period of not less than 180 days.


 


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


 


(a)                                  in the case of a default referred to in clause (i) above, the
date upon which the default is cured or waived or ceases to exist, or


 


(b)                                 in the case of a default referred to in clause (ii) above, the
earlier of the date on which such default is cured or waived or ceases to exist
or 179 days pass after the date on which the applicable Payment Blockage Notice
is received, if the maturity of such Designated Senior Indebtedness has not
been accelerated, unless this Article 6 otherwise prohibits the payment or
distribution at the time of such payment or distribution.


 


Upon any payment by the Company, or
distribution of assets of the Company of any kind or character, whether in
cash, property or securities, to creditors upon any dissolution or winding-up
or liquidation or reorganization of the Company (whether voluntary or
involuntary) or in bankruptcy, insolvency, receivership or similar proceedings,
all amounts due or to become due upon all Senior Indebtedness shall first be
paid in full, in cash or other payment satisfactory to the holders of Senior
Indebtedness, before any payment is made on account of the principal of, the
cash portion of the Conversion Obligation, if any, or interest on, the Securities
(except payments made pursuant to Article 11 from monies deposited with
the Trustee pursuant thereto prior to commencement of proceedings for such
dissolution, winding-up, liquidation or reorganization); and upon any such
dissolution or winding-up or liquidation or reorganization of the Company or
bankruptcy, insolvency, receivership or other proceeding, any payment by the
Company, or distribution of assets of the Company of any kind or character,
whether in cash, property or securities, to which the Holders of the Securities
or the Trustee would be entitled,


 


47

















 


except for the provision of this Article 6,
shall (except as aforesaid) be paid by the Company or by any receiver, trustee
in bankruptcy, liquidating trustee, agent or other Person making such payment
or distribution, or by the Holders of the Securities or by the Trustee under
this Indenture, if received by them or it, directly to the holders of Senior
Indebtedness (pro rata to such holders on the basis of the respective amounts
of Senior Indebtedness held by such holders, or as otherwise required by law or
a court order) or their representative or representatives, or to the trustee or
trustees under any indenture pursuant to which any instruments evidencing any
Senior Indebtedness may have been issued, as their respective interests may
appear, to the extent necessary to pay all Senior Indebtedness in full, in cash
or other payment satisfactory to the holders of Senior Indebtedness, after
giving effect to any concurrent payment or distribution to or for the holders
of Senior Indebtedness, before any payment or distribution is made to the
Holders of the Securities or to the Trustee.


 


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


 


In the event of the acceleration of the
Securities because of an Event of Default, no payment or distribution shall be
made to the Trustee or any Holder of Securities in respect of the principal of,
the cash portion of the Conversion Obligation, if any, or interest on, the
Securities by the Company (including, but not limited to, the Fundamental
Change Purchase Price with respect to the Securities subject to purchase in
accordance with Article 3 as provided in this Indenture), except payments
and distributions made by the Trustee as permitted by Section 6.05, until
all Senior Indebtedness has been paid in full in cash or other payment
satisfactory to the holders of Senior Indebtedness or such acceleration is
rescinded in accordance with the terms of this Indenture.  If payment of Securities is accelerated
because of an Event of Default, the Company shall promptly notify holders of
Senior Indebtedness of such acceleration.


 


In the event that, notwithstanding the
foregoing provisions, any payment or distribution of assets of the Company of
any kind or character, whether in cash, property or securities (including,
without limitation, by way of setoff or otherwise), prohibited by the
foregoing, shall be received by the Trustee or the Holders of the Securities
before all Senior Indebtedness is paid


 


48

















 


in full, in cash or other payment
satisfactory to the holders of Senior Indebtedness, or provision is made for
such payment thereof in accordance with its terms in cash or other payment
satisfactory to the holders of Senior Indebtedness, such payment or
distribution shall be held in trust for the benefit of and shall be paid over
or delivered to the holders of Senior Indebtedness or their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing any Senior Indebtedness may have been issued,
as their respective interests may appear, as calculated by the Company, for
application to the payment of all Senior Indebtedness remaining unpaid to the
extent necessary to pay all Senior Indebtedness in full, in cash or other
payment satisfactory to the holders of Senior Indebtedness, after giving effect
to any concurrent payment or distribution to or for the holders of such Senior
Indebtedness.


 


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


 


Section 6.03.  Subrogation
of Securities.


 


Subject to the payment in full, in cash or
other payment satisfactory to the holders of Senior Indebtedness, of all Senior
Indebtedness, the rights of the Holders of the Securities shall be subrogated
to the extent of the payments or distributions made to the holders of such
Senior Indebtedness pursuant to the provisions of this Article 6 (equally
and ratably with the holders of all indebtedness of the Company which by its
express terms is subordinated to other indebtedness of the Company to
substantially the same extent as the Securities are subordinated and is
entitled to like rights of subrogation) to the rights of the holders of Senior
Indebtedness to receive payments or distributions of cash, property or
securities of the Company applicable to the Senior Indebtedness until the
principal of, the cash portion of the Conversion Obligation, if any, and
interest on, the Securities shall be paid in full, in cash or other payment
satisfactory to the holders of Senior Indebtedness; and, for the purposes of
such subrogation, no payments or distributions to the holders of the Senior
Indebtedness of any cash, property or securities to which the Holders of the
Securities or the Trustee would be entitled except for the provisions of this Article 6,
and no payment over, pursuant to the provisions of this Article 6, to or
for the benefit of the holders of Senior Indebtedness by Holders of the
Securities or the Trustee shall, as between the Company, its creditors other
than holders of Senior Indebtedness and the Holders of the Securities, be
deemed to be a payment by the Company to or on account of the Senior
Indebtedness; and no payments or distributions of cash, property or securities
to or for the benefit of the Holders of the Securities pursuant to the
subrogation provisions of this Article 6, which would otherwise have been
paid to the holders of Senior Indebtedness, shall be deemed to be a payment by
the Company to or for the account of the Securities.  It is understood that the provisions of this Article 6
are and are intended solely for the purposes of defining the relative rights of
the Holders of the Securities, on the one hand, and the holders of the Senior
Indebtedness, on the other hand.


 


Nothing contained in this Article 6
or elsewhere in this Indenture or in the Securities is intended to or shall
impair, as among the Company, its creditors other than the holders of Senior


 


49

















 


Indebtedness and the Holders of the
Securities, the obligation of the Company, which is absolute and unconditional,
to pay to the Holders of the Securities the principal of, the cash portion of
the Conversion Obligation, if any, and any interest on the Securities as and
when the same shall become due and payable in accordance with their terms, or
is intended to or shall affect the relative rights of the Holders of the
Securities and creditors of the Company other than the holders of the Senior
Indebtedness, nor shall anything herein or therein prevent the Trustee or the
Holder of any Security from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture, subject to the rights, if
any, under this Article 6 of the holders of Senior Indebtedness in respect
of cash, property or securities of the Company received upon the exercise of
any such remedy.


 


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


 


Section 6.04. 
Authorization to Effect Subordination.


 


Each Holder of a Security by the Holder’s
acceptance thereof authorizes and directs the Trustee on the Holder’s behalf to
take such action as may be necessary or appropriate to effectuate the
subordination as provided in this Article 6 and appoints the Trustee to
act as the Holder’s attorney-in-fact for any and all such purposes.  If the Trustee does not file a proper proof
of claim or proof of debt in the form required in any proceeding referred to in
Section 6.03 hereof at least 30 days before the expiration of the time to
file such claim, the holders of any Senior Indebtedness or their
representatives are hereby authorized to file an appropriate claim for and on
behalf of the Holders of the Securities.


 


Section 6.05.  Notice to
Trustee.


 


The Company shall give prompt written
notice in the form of an Officers’ Certificate to a Trust Officer of the
Trustee and to any Paying Agent of any fact known to the Company which would
prohibit the making of any payment of monies to or by the Trustee or any Paying
Agent in respect of the Securities pursuant to the provisions of this Article 6.  Notwithstanding the provisions of this Article 6
or any other provision of this Indenture, the Trustee shall not be charged with
knowledge of the existence of any facts which would prohibit the making of any
payment of monies to or by the Trustee in respect of the Securities pursuant to
the provisions of this Article 6, unless and until a Trust Officer of the
Trustee shall have received written notice thereof at the Corporate Trust
Office from the Company (in the form of an Officers’ Certificate) or a
Representative or a holder or holders of Senior Indebtedness or from any
trustee thereof; and before the receipt of any such written notice, the
Trustee, subject to the provisions of Section 10.01,


 


50

















 


shall be entitled in all respects
to assume that no such facts exist; provided
that, if on a date not less than one Business Day prior to the date upon which
by the terms hereof any such monies may become payable for any purpose
(including, without limitation, the payment of the principal of, or interest
on, any Security) the Trustee shall not have received, with respect to such
monies, the notice provided for in this Section 6.05, then, anything
herein contained to the contrary notwithstanding, the Trustee shall have full
power and authority to receive such monies and to apply the same to the purpose
for which they were received and shall not be affected by any notice to the
contrary which may be received by it on or after such prior date.  Notwithstanding anything in this Article 6
to the contrary, nothing shall prevent any payment by the Trustee to the
Holders of monies deposited with it pursuant to Article 11, and any such
payment shall not be subject to the provisions of Article 6.


 


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


 


Section 6.06.  Trustee’s
Relation to Senior Indebtedness.


 


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


 


With respect to the holders of Senior
Indebtedness, the Trustee undertakes to perform or to observe only such of its
covenants and obligations as are specifically set forth in this Article 6,
and no implied covenants or obligations with respect to the holders of Senior
Indebtedness shall be read into this Indenture against the Trustee.  The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Indebtedness, and, subject to the
provisions of Section 10.01, the Trustee shall not be liable to any holder
of Senior Indebtedness if it shall pay over or deliver to Holders of
Securities, the Company or any other person money or assets to which any holder
of Senior Indebtedness shall be entitled by virtue of this Article 6 or
otherwise.


 


Section 6.07.  No
Impairment of Subordination.


 


No right of any present or future holder
of any Senior Indebtedness to enforce subordination as herein provided shall at
any time in any way be prejudiced or impaired by any


 


51

















 


act or failure to act on the part
of the Company or by any act or failure to act, in good faith, by any such
holder or by any noncompliance by the Company with the terms, provisions and
covenants of this Indenture, regardless of any knowledge thereof which any such
holder may have or otherwise be charged with.


 


Section 6.08.  Certain
Conversions Deemed Payment.


 


For the purposes of this Article 6
only, (1) the issuance and delivery of junior securities upon conversion
of Securities in accordance with Article 5 shall not be deemed to
constitute a payment or distribution on account of the principal of, the cash
portion of the Conversion Obligation, if any, or interest on, Securities or on
account of the purchase or other acquisition of Securities, and (2) the
payment, issuance or delivery of cash (except in satisfaction of fractional
shares pursuant to Section 5.03), property or securities (other than
junior securities) upon conversion of a Security shall be deemed to constitute
payment on account of the principal of such Security.  For the purposes of this Section 6.08,
the term “junior securities” means (a) shares of any stock of any class of
the Company or (b) securities of the Company which are subordinated in
right of payment to all Senior Indebtedness which may be outstanding at the
time of issuance or delivery of such securities to substantially the same
extent as, or to a greater extent than, the Securities are so subordinated as
provided in this Article.  Nothing
contained in this Article 6 or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as among the Company, its creditors
other than holders of Senior Indebtedness and the Holders, the right, which is
absolute and unconditional, of the Holder of any Security to convert such
Security in accordance with Article 5.


 


Section 6.09.  Article Applicable
to Paying Agents.


 


If at any time any Paying Agent other than
the Trustee shall have been appointed by the Company and be then acting
hereunder, the term “Trustee” as
used in this Article shall (unless the context otherwise requires) be
construed as extending to and including such Paying Agent within its meaning as
fully for all intents and purposes as if such Paying Agent were named in this Article in
addition to or in place of the Trustee; provided,
however, that the first paragraph of Section 6.05 shall not
apply to the Company or any Affiliate of the Company if it or such Affiliate
acts as Paying Agent.


 


Section 6.10.  Senior
Indebtedness Entitled to Rely.


 


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


 


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ARTICLE 7

COVENANTS


 


Section 7.01.  Payment of
Securities.


 


The Company
shall promptly make all payments in respect of the Securities on the dates and
in the manner provided in the Securities and this Indenture.  The installment of principal or interest shall
be considered paid on the date it is due if the Paying Agent (other than the
Company) holds by 11:00 a.m., New York City time, on that date money,
deposited by the Company or an Affiliate thereof, sufficient to pay such
installment.  The Company shall (in
immediately available funds), to the fullest extent permitted by law, pay
interest on overdue principal and overdue installments of interest at the rate
borne by the Securities per annum.


 


Payment of the
principal of and interest on the Securities shall be made at the office or
agency of the Company maintained for that purpose in the Borough of Manhattan,
The City of New York (which shall initially be U.S. Bank Trust National
Association, an Affiliate of the Trustee), or at the Corporate Trust Office of
the Trustee in such coin or currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts; provided, however, that at the option of
the Company payment of interest may be made by check mailed to the address of
the Person entitled thereto as such address appears in the Register; provided, further, that a Holder with an
aggregate principal amount in excess of $1,000,000 will be paid by wire
transfer in immediately available funds at the election of such Holder if such
Holder has provided wire transfer instructions to the Company at least 10
Business Days prior to the payment date.


 


Section 7.02.  Reports.


 


So long as any Securities are outstanding,
the Company shall (i) file with the SEC within the time periods prescribed
by its rules and regulations and (ii) furnish to the Trustee and the
Holders of the Securities within 15 days after the date on which the Company
would be required to file the same with the SEC pursuant to its rules and
regulations (giving effect to any grace period provided by Rule 12b-25
under the Exchange Act), all quarterly and annual financial information
required to be contained in Forms 10-Q and 10-K and, with respect to the annual
consolidated financial statements only, a report thereon by the Company’s
independent auditors.


 


Delivery of such reports, information and
documents to the Trustee is for informational purposes only, and the Trustee’s
receipt of such shall not constitute constructive notice of any information
contained therein or determinable from information contained therein, including
the Company’s compliance with any of its covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers’ Certificates).  The Company shall not be required to file any
report or other information with the SEC if the SEC does not permit such
filing, although such reports shall be furnished to the Trustee.  Documents filed by the Company with the SEC
via the SEC’s EDGAR system (or any successor thereto) will be deemed furnished
to the Trustee and the Holders of the Securities as of the time such documents
are filed via EDGAR (or such successor).


 


Section 7.03.  Compliance
Certificates.


 


The Company
shall deliver to the Trustee, within 120 days after the end of each fiscal year
of the Company (beginning with the fiscal year ending December 31, 2009),
an Officers’


 


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Certificate
as to the signer’s knowledge of the Company’s compliance with all conditions
and covenants on its part contained in this Indenture and stating whether or
not the signer knows of any default or Event of Default.  If such signer knows of such a default or
Event of Default, the Officers’ Certificate shall describe the default or Event
of Default and the efforts to remedy the same. 
For the purposes of this Section 7.03, compliance shall be
determined without regard to any grace period or requirement of notice provided
pursuant to the terms of this Indenture.


 


Section 7.04.  Further
Instruments and Acts.


 


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


 


Section 7.05.  Maintenance
of Corporate Existence.


 


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


 


Section 7.06.  Stay,
Extension and Usury Laws.


 


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


 


Section 7.07.  Additional
Interest Notice.


 


In the event that the Company is required
to pay additional interest to Holders of Securities pursuant to Section 9.02(b) hereof,
the Company shall provide a direction or order in the form of a written notice
to the Trustee (and if the Trustee is not the Paying Agent, the Paying Agent)
of the Company’s obligation to pay such additional
interest no later than three Business Days prior to date on which any such
additional interest is scheduled to be paid. 
Such notice shall set forth the amount of additional interest to be paid
by the Company on such payment date and direct the Trustee (or, if the Trustee
is not the Paying Agent, the Paying Agent) to make payment to the extent it
receives funds from the Company to do so. 
The Trustee shall not at any time be under any duty or responsibility to
any Holder to determine whether additional interest is payable, or with respect
to the nature, extent, or calculation of the amount of additional interest
owed, or with respect to the method employed in such calculation of additional
interest.


 


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ARTICLE
8

CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE


 


Section 8.01.  Company May Consolidate,
etc., only on Certain Terms.


 


The Company shall
not consolidate with, enter into a binding share exchange with, or merge into
any other Person (in a transaction in which the Company is not the surviving
corporation) or sell, assign, convey, transfer, lease or otherwise dispose of
its properties and assets substantially as an entirety to any Person, unless:


 


(1)           in
case the Company shall consolidate with, enter into a binding share exchange
with, or merge into another Person (in a transaction in which the Company is
not the surviving corporation) or convey, transfer or lease its properties and
assets substantially as an entirety to any Person, the Person formed by such
consolidation or into which the Company is merged or the Person which acquires
by conveyance or transfer, or which leases, the properties and assets of the
Company substantially as an entirety shall be a corporation organized and
validly existing under the laws of the United States of America, any State
thereof or the District of Columbia and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the principal of,
and any interest on, all the Securities and the performance or observance of
every covenant of this Indenture on the part of the Company to be performed or
observed, and the conversion rights shall be provided for in accordance with Article 5,
by supplemental indenture satisfactory in form to the Trustee, executed and
delivered to the Trustee, by the Person (if other than the Company) formed by
such consolidation or into which the Company shall have been merged or by the
Person which shall have acquired the Company’s assets;


 


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


 


(3)           the
Company has delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel, each stating that such consolidation, merger, conveyance, transfer or
lease and, if a supplemental indenture is required in connection with such
transaction, such supplemental indenture comply with this Article and that
all conditions precedent herein provided for relating to such transaction have
been complied with.


 


Section 8.02.  Successor
Substituted.


 


Upon any
consolidation of the Company with, or merger of the Company into, any other
Person or any conveyance, transfer or lease of the properties and assets of the
Company substantially as an entirety in accordance with Section 8.01, the
successor Person formed by such consolidation or into which the Company is
merged or to which such conveyance, transfer or lease is made shall succeed to,
and be substituted for, and may exercise every right and power of, the Company
under this Indenture with the same effect as if such successor Person had been


 


55

















 


named as the
Company herein, and thereafter, except in the case of a lease, the predecessor
Person shall be relieved of all obligations and covenants under this Indenture
and the Securities.


 


ARTICLE
9

DEFAULT AND REMEDIES


 


Section 9.01.  Events of
Default.


 


An “Event of Default” with respect to
Securities shall occur if:


 


(a)        the Company defaults in the payment of
any principal of any Security when the same becomes due and payable (whether at
maturity, upon required repurchase, following a Fundamental Change or otherwise),
whether or not such payment shall be prohibited by the provisions of Article 6
hereof;


 


(b)        the Company fails to pay the cash and
deliver the shares of Common Stock, if any, representing the Conversion
Obligation upon conversion of any Security (including any Additional Shares)
within the time period required by the provisions of this Indenture, whether or
not such payment shall be prohibited by the provisions of Article 6
hereof;


 


(c)        the Company defaults in the payment of
interest when the same becomes due and payable and the default continues for a
period of 30 days, whether or not such payment shall be prohibited by the
provisions of Article 6 hereof;


 


(d)        the Company fails to perform or comply
with any of its other covenants or agreements contained in the Securities or in
this Indenture (other than a covenant or agreement a default in whose
performance or whose breach is specifically dealt with in clauses (a), (b) or
(c) of this Section 9.01) and the default continues for 60 days after
notice is given as specified below;


 


(e)        the Company defaults in the payment of
the purchase price of any Security when the same becomes due and payable,
whether or not such payment shall be prohibited by the provisions of Article 6
hereof;


 


(f)         the Company fails to provide a
Fundamental Change Purchase Notice when required by Section 3.01;


 


(g)        any indebtedness under any bond,
debenture, note or other evidence of indebtedness for money borrowed by the
Company or any Significant Subsidiary (or group of Subsidiaries that, taken as
a whole, would constitute a Significant Subsidiary) or under any mortgage,
indenture or instrument under which there may be issued or by which there may
be secured or evidenced any indebtedness for money borrowed by, or any other
payment obligation of, the Company or any Significant Subsidiary (or group of
Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary)
(an “Instrument”) with a principal
amount then, individually or in the aggregate, outstanding in excess of
$10,000,000, whether such


 


56

















 


indebtedness
now exists or shall hereafter be created, is not paid at final maturity of the
Instrument (either at its stated maturity or upon acceleration thereof) or when
otherwise due or is accelerated, and such indebtedness is not discharged, or
such default in payment or acceleration is not cured or rescinded, within a
period of 30 days after there shall have been given, by registered or certified
mail, 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
Securities a written notice specifying such default and requiring the Company
to cause such indebtedness to be discharged or cause such default to be cured
or waived or such acceleration to be rescinded or annulled and stating that
such notice is a “Notice of Default”
hereunder;


 


(h)        the Company or any Significant
Subsidiary (or any group of Subsidiaries that, taken as a whole, would constitute
a Significant Subsidiary) fails to pay one or more final and non-appealable
judgments entered by a court or courts of competent jurisdiction, the aggregate
uninsured or unbonded portion of which is in excess of $10,000,000, if the
judgments are not paid, discharged, waived or stayed within 30 days;


 


(i)         the Company or any Significant
Subsidiary (or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary) of the Company, pursuant to or within the
meaning of any Bankruptcy Law:


 


(i)            commences a voluntary case or
proceeding;


 


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


 


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


 


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


 


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


 


(i)            is for relief against the Company or
any Significant Subsidiary (or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary) of the Company in an
involuntary case or proceeding;


 


(ii)           appoints a Custodian of the Company
or any Significant Subsidiary (or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary) of the Company for all or
substantially all of the property of the Company or any such Significant
Subsidiary (or such group of Subsidiaries); or


 


(iii)          orders the liquidation of the Company
or any Significant Subsidiary (or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary) of the Company;


 


57

















 


and the case
of each of clause (i), (ii) and (iii), the order or decree remains
unstayed and in effect for 60 consecutive days.


 


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


 


A default under
clause (d) above is not an Event of Default until the Trustee notifies the
Company, or the Holders of at least 25% in aggregate principal amount of the
Securities then outstanding notify the Company and the Trustee, in writing of
the default, and the Company does not cure the default within 60 days after
receipt of such notice.  The notice given
pursuant to this Section 9.01 must specify the default, demand that it be
remedied and state that the notice is a “Notice of Default.”  When any default under this Section 9.01
is cured, it ceases.


 


The Trustee shall
not be charged with knowledge of any Event of Default unless written notice
thereof shall have been given to a Trust Officer at the Corporate Trust Office
of the Trustee by the Company, a Paying Agent, any Holder or any agent of any
Holder.  The Company shall deliver to the
Trustee, within 30 days after the occurrence thereof, written notice in the
form of an Officers’ Certificate of any Event of Default described in clause
(g), (h), (i) or (j) above and any event of which it becomes aware
that with the giving of notice or the lapse of time would become such an Event
of Default, its status and what action the Company is taking or proposes to
take with respect thereto.


 


Section 9.02. 
Acceleration.


 


(a)           If an Event of Default (other than an
Event of Default specified in clause (i) or (j) of Section 9.01)
occurs and is continuing with respect to any Securities, the Trustee may, by
notice to the Company, or the Holders of at least 25% in aggregate principal
amount of the Securities then outstanding may, by notice to the Company and the
Trustee, declare all unpaid principal to the date of acceleration on the
Securities then outstanding (if not then due and payable) to be due and payable
upon any such declaration, and the same shall become and be immediately due and
payable.  If an Event of Default
specified in clause (i) or (j) of Section 9.01 occurs, all unpaid
principal of the Securities then outstanding shall ipso facto become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holder.  The Holders
of a majority in aggregate principal amount of the Securities then outstanding
by notice to the Trustee may rescind an acceleration of Securities and its
consequences if (a) all
existing Events of Default, other than the nonpayment of the principal of the
Securities which has become due solely by such declaration of acceleration,
have been cured or waived; (b) to
the extent the payment of such interest is lawful, interest (calculated at the
rate of 21⁄2% per annum) on overdue installments of interest and overdue
principal, which has become due otherwise than by such declaration of
acceleration, has been paid; (c) the
rescission would not conflict with any judgment or decree of a court of
competent jurisdiction; and (d) all
payments due to the Trustee and any predecessor Trustee under Section 10.07
have been made.  No such rescission shall
affect any subsequent default or impair any right consequent thereto.


 


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(b)           Notwithstanding any of provision of
this Article 9, at the election of the Company in its sole discretion, the
sole remedy under this Indenture for an Event of Default relating to the
failure to comply with Section 7.02, and for any failure to comply with
the requirements of Section 314(a)(1) of the TIA, will consist, for
the 180 days after the occurrence of such an Event of Default, exclusively of
the right to receive additional interest on the Securities at a rate equal to
0.50% per annum of the aggregate principal amount of the Securities then
outstanding up to, but not including, the 181st day thereafter (or, if
applicable, the earlier date on which the Event of Default relating to Section 7.02
is cured or waived).  Any such additional
interest will be payable in the same manner and on the same dates as the stated
interest payable on the Securities.  In
no event shall additional interest accrue under the terms of this Indenture at
a rate in excess of 0.50% per annum, in the aggregate, for any violation or
default caused by the failure of the Company to be current in respect of its
Exchange Act reporting obligations.  If
the Event of Default is continuing on the 181st day after an Event of Default
relating to a failure to comply with Section 7.02, the Securities will be
subject to acceleration as provided in this Section 9.02.  The provisions of this Section 9.02(b) will
not affect the rights of Holders in the event of the occurrence of any other
Events of Default.


 


In order to elect
to pay additional interest as the sole remedy during the first 180 days after
the occurrence of an Event of Default relating to the failure to comply with Section 7.02
in accordance with the immediately preceding paragraph, the Company shall
notify all Holders and the Trustee and Paying Agent of such election on or
before the close of business on the fifth Business Day after the date on which
such Event of Default otherwise would occur. 
Upon a failure by the Company to timely give such notice or pay
additional interest, the Securities will be immediately subject to acceleration
as otherwise provided in this Section 9.02.


 


Section 9.03.  Other
Remedies.


 


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


 


The Trustee may
maintain a proceeding even if it does not possess any of the Securities or does
not produce any of them in the proceeding. 
A delay or omission by the Trustee or any Holder in exercising any right
or remedy accruing upon an Event of Default shall not impair the right or
remedy or constitute a waiver of or acquiescence in the Event of Default.  No remedy is exclusive of any other
remedy.  All available remedies are
cumulative to the extent permitted by law.


 


Section 9.04.  Waiver of
Defaults and Events of Default.


 


Subject to Section 9.07
and 12.02, the Holders of a majority in aggregate principal amount of the
Securities then outstanding by notice to the Trustee may waive an existing
default or Event of Default and its consequence, except a default or Event of
Default in the payment of the principal of, or interest on any Security, a
failure by the Company to deliver cash and shares of Common Stock, if any, upon
conversion of the Securities or any default or Event of Default in


 


59

















 


respect of
any provision of this Indenture or the Securities which, under Section 12.02,
cannot be modified or amended without the consent of the Holder of each
Security affected.  When a default or
Event of Default is waived, it is cured and ceases.


 


Section 9.05.  Control by Majority.


 


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


 


Section 9.06.  Limitations on Suits.


 


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


 


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


 


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


 


(c)        such Holder or Holders offer to the
Trustee reasonable indemnity to the Trustee against any loss, liability or
expense;


 


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


 


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


 


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


 


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


 


Notwithstanding any
other provision of this Indenture, the right of any Holder of a Security to
receive payment of the principal of, and interest on, if any, on, the Security,
on or after the respective due dates expressed in the Security and this
Indenture, to convert such Security in accordance with Article 5 and to
bring suit for the enforcement of any such payment


 


60

















 


on or after
such respective dates or the right to convert, is absolute and unconditional
and shall not be impaired or affected without the consent of the Holder.


 


Section 9.08.  Collection
Suit by Trustee.


 


If an Event of
Default in the payment of principal, interest, if any, specified in clause (a) or
(c) of Section 9.01 occurs and is continuing, the Trustee may recover
judgment in its own name and as trustee of an express trust against the Company
or another obligor on the Securities for the whole amount of principal, and
accrued interest remaining unpaid, if any, together with, to the extent that
payment of such interest is lawful, interest on overdue principal, on overdue
installments of interest, if any, in each case at the rate of 21⁄2% per annum,
and such further amount as shall be sufficient to cover the costs and expenses
of collection, including the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel.


 


Section 9.09.  Trustee May File
Proofs of Claim.


 


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


 


Section 9.10.  Priorities.


 


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


 


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


 


Second, to the holders of Senior Indebtedness to the extent required by Article 6;


 


61

















 


Third, to Holders for amounts due and unpaid on the Securities for
principal, interest, if any, ratably, without preference or priority of any
kind, according to the amounts due and payable on the Securities for principal,
interest, if any, respectively; and


 


Fourth, the balance, if any, to the Company.


 


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


 


Section 9.11.  Undertaking
for Costs.


 


In any suit for the
enforcement of any right or remedy under this Indenture or in any suit against
the Trustee for any action taken or omitted by it as Trustee, a court in its
discretion may require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorneys’ fees and expenses,
against any party litigant in the suit, having due regard to the merits and
good faith of the claims or defenses made by the party litigant.  This Section 9.11 does not apply to a
suit made by the Trustee, a suit by a Holder pursuant to Section 9.07 or a
suit by Holders of more than 10% in aggregate principal amount of the
Securities then outstanding.


 


ARTICLE
10

TRUSTEE


 


Section 10.01.  Duties of
Trustee.


 


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


 


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


 


(i)            the Trustee need perform only those
duties as are specifically set forth in this Indenture and no others; 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.  The Trustee, however, shall
examine any certificates and opinions which by any provision hereof are specifically
required to be delivered to the Trustee to determine whether or not they
conform to the requirements of this Indenture.


 


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


 


62
















 


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


 


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


 


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


 


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


 


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


 


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


 


(g)        At 5:00 p.m., New York City time,
on each Trading Day, the Trustee shall print and retain, for a period of 30
Business Days, the Daily VWAP for such Trading Day, to the extent such Daily
VWAP is available on Bloomberg.


 


Section 10.02.  Rights of
Trustee.


 


Subject to Section 10.01:


 


(a)        The Trustee may rely conclusively 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, which
shall conform to Section 13.04(b). 
The Trustee shall not be liable for any action it takes or omits to take
in good faith in reliance on such Officers’ Certificate or Opinion of Counsel.


 


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


 


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


 


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


 


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


 


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


 


(h)        The Trustee shall not be deemed to have
notice of any Default or Event of Default unless a Trust Officer of the Trustee
has actual knowledge thereof or unless written notice of any event which is in
fact such a default is received by the Trustee at the Corporate Trust Office,
and such notice references the Securities and this Indenture.


 


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


 


Section 10.03.  Individual Rights of Trustee.


 


The
Trustee in its individual or any other capacity may become the owner or pledgee
of Securities and may otherwise deal with the Company or an Affiliate of the
Company with the same rights it would have if it were not Trustee.  Any Agent may do the same with like
rights.  However, the Trustee is subject
to Section 10.10 and 10.11.


 


Section 10.04.  Trustee’s
Disclaimer.


 


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


 


64

















 


Section 10.05.  Notice of
Default or Events of Default.


 


If a default or an
Event of Default occurs and is continuing and if it is known to the Trustee,
the Trustee shall mail to each Holder notice of the default or Event of Default
within 90 days after it occurs.  However,
the Trustee may withhold the notice if and so long as a committee of its Trust
Officers in good faith determines that withholding notice is in the interests
of Holders, except in the case of a default or an Event of Default in payment
of the principal of, or interest on any Security.


 


Section 10.06.  Reports by
Trustee to Holders.


 


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


 


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


 


Section 10.07.  Compensation
and Indemnity.


 


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


 


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


 


The Company need
not reimburse the Trustee for any expense or indemnify it against any loss or
liability incurred by it resulting from its gross negligence or bad faith.


 


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


 


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


 


Section 10.08.  Replacement
of Trustee.


 


The Trustee may
resign by so notifying the Company.  The
Holders of a majority in aggregate principal amount of the Securities then
outstanding may remove the Trustee by so notifying the Trustee and may, with
the Company’s written consent, appoint a successor Trustee.  The Company may remove the Trustee if:


 


(a)        the Trustee fails to comply with Section 10.10;


 


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


 


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


 


(d)        the Trustee becomes incapable of acting.


 


If
the Trustee resigns or is removed or if a vacancy exists in the office of
Trustee for any reason, the Company shall promptly appoint a successor
Trustee.  The resignation or removal of a
Trustee shall not be effective until a successor Trustee shall have delivered
the written acceptance of its appointment as described below.


 


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


 


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


 


A successor Trustee
shall deliver a written acceptance of its appointment to the retiring Trustee
and to the Company.  Immediately after
that, the retiring Trustee shall transfer all property held by it as Trustee to
the successor Trustee and be released from its obligations (exclusive of any
liabilities that the retiring Trustee may have incurred while acting as
Trustee) hereunder, the resignation or removal of the retiring Trustee shall
become effective, and the


 


66

















 


successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture.  A successor Trustee shall
mail notice of its succession to each Holder.


 


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


 


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


 


Section 10.09.  Successor
Trustee by Merger, etc.


 


If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all of its corporate trust assets (including the administration of this
Indenture) to, another corporation, the resulting, surviving or transferee
corporation, without any further act, shall be the successor Trustee, provided
such transferee corporation shall qualify and be eligible under Section 10.10.  Such successor Trustee shall promptly mail
notice of its succession to the Company and each Holder.


 


Section 10.10.  Eligibility;
Disqualification.


 


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


 


Section 10.11.  Preferential
Collection of Claims Against Company.


 


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


 


ARTICLE
11

SATISFACTION AND DISCHARGE


 


Section 11.01.  Satisfaction
and Discharge.


 


(a)        This Indenture shall cease to be of
further effect, and the Trustee, on demand of and at the expense of the
Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when


 


(i)            all Securities theretofore authenticated
and delivered (other than (i) Securities which have been destroyed, lost
or stolen and which have been replaced or


 


67

















 


paid as provided in Section 2.07
and (ii) Securities for whose payment money has theretofore been deposited
in trust and thereafter repaid to the Company as provided in Section 11.03)
have been delivered to the Trustee for cancellation;


 


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


 


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


 


Notwithstanding the
satisfaction and discharge of this Indenture, the obligations of the Company to
the Trustee under Section 10.07 shall survive.


 


(b)        The Company may discharge its
obligations to pay principal of, and interest, if any, on, the Securities when all
Securities not theretofore delivered to the Trustee for cancellation


 


(i)            have become due and payable, or


 


(ii)           will become due and payable at the
Final Maturity Date within one year,


 


and the
Company, in the case of clause (i) or (ii) above, has delivered to
Holders or irrevocably deposited or caused to be irrevocably deposited with the
Trustee or a Paying Agent (other than the Company or any of its Affiliates) as
trust funds in trust for the purpose cash in an amount sufficient to pay and
discharge the entire indebtedness on such Securities not theretofore delivered
to the Trustee for cancellation, for principal and interest, to the date of
such delivery or deposit (in the case of Securities which have become due and
payable) or to the Final Maturity Date.


 


Section 11.02.  Application
of Trust Money.


 


Subject to the
provisions of Section 11.03, the Trustee or a Paying Agent shall hold in
trust, for the benefit of the Holders of Securities, all money deposited with
it pursuant to Section 11.01(b) with respect to Securities and shall
apply the deposited money in accordance with this Indenture and the Securities
to the payment of the principal of, and any interest on, the Securities.  Money so held in trust shall not be subject
to the subordination provisions of Article 6.


 


Section 11.03.  Repayment to
Company.


 


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


 


The Trustee and
each Paying Agent shall pay to the Company upon request any money held by them
for the payment of principal or interest that remains unclaimed for two years
after a 


 


68

















 


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


 


Section 11.04. 
Reinstatement.


 


If the Trustee or
any Paying Agent is unable to apply any money in accordance with Section 11.02
by reason of any legal proceeding or by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, then the Company’s obligations under this Indenture and the
Securities shall be revived and reinstated as though no deposit had occurred
pursuant to Section 11.01(b) until such time as the Trustee or such
Paying Agent is permitted to apply all such money in accordance with Section 11.02;
provided, however, that, if the Company has made any payment of the principal
of, or interest on, any Securities because of the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of
such Securities to receive any such payment from the money held by the Trustee
or such Paying Agent.


 


ARTICLE
12

AMENDMENTS, SUPPLEMENTS AND WAIVERS


 


Section 12.01.  Without
Consent of Holders.


 


The Company and the
Trustee may amend or supplement this Indenture or the Securities without notice
to or consent of any Holder:


 


(a)        to comply with Section 5.12 and
8.01;


 


(b)        to cure any ambiguity, defect or
inconsistency;


 


(c)        to make any other change that does not
adversely affect the rights of any Holder;


 


(d)        to comply with the provisions of the
TIA;


 


(e)        to add to the covenants of the Company
for the equal and ratable benefit of the Holders or to surrender any right,
power or option conferred upon the Company; or


 


(f)         to appoint a successor Trustee.


 


Any amendment or
supplement made solely to conform the provisions of this Indenture or the
Securities to the description thereof contained in the final prospectus
relating to the Securities will be deemed not to adversely affect the rights of
any Holder.


 


69

















 


Section 12.02.  With Consent
of Holders.


 


The Company and the
Trustee may amend or supplement the Securities or this Indenture with the
written consent of the Holders of at least a majority in aggregate principal
amount of the Securities then outstanding. 
The Holders of at least a majority in aggregate principal amount of the
Securities then outstanding may waive compliance in a particular instance by
the Company with any provision of the Securities or this Indenture without
notice to any Holder.  However,
notwithstanding the foregoing but subject to Section 12.04, without the
written consent of each Holder affected, an amendment, supplement or waiver,
including a waiver pursuant to Section 9.04, may not:


 


(a)        change the stated maturity of the
principal of, or the date any installment of interest is due on, any Security;


 


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


 


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


 


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


 


(e)        impair the right of any Holder to
receive payment of principal of, or interest on, the Securities of such Holder
on or after the due dates therefor;


 


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


 


(g)        modify the provisions with respect to
the purchase right of Holders pursuant to Article 3 upon a Fundamental
Change in a manner adverse to Holders;


 


(h)        modify the subordination provisions of Article 6
in a manner materially adverse to the Holders of Securities;


 


(i)         change the ranking of the Securities;


 


(j)         adversely affect the right of Holders
to convert Securities other than as provided in or under Article 5 of this
Indenture; and


 


(k)        modify any of the provisions of this Section or
Section 9.04, except to increase any such percentage or to provide that
certain provisions of this Indenture cannot be modified, amended or waived
without the consent of the Holder of each outstanding Security affected
thereby.


 


It shall not be
necessary for the consent of the Holders under this Section 12.02 to
approve the particular form of any proposed amendment, supplement or waiver,
but it shall be sufficient if such consent approves the substance thereof.


 


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After an amendment,
supplement or waiver under this Section 12.02 becomes effective, the
Company shall mail to the Holders affected thereby a notice briefly describing
the amendment, supplement or waiver.  Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such amendment,
supplement or waiver.  An amendment or
supplement under this Section 12.02 or under Section 12.01 may not
make any change that adversely affects the rights under Article 6 of any
holder of an issue of Senior Indebtedness unless the holders of that issue,
pursuant to its terms, consent to the change.


 


Section 12.03.  Compliance
with Trust Indenture Act.


 


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


 


Section 12.04.  Revocation
and Effect of Consents.


 


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


 


After an amendment,
supplement or waiver becomes effective, it shall bind every applicable Holder,
unless it makes a change described in any of clauses (a) through (k) of
Section 12.02.  In that case the
amendment, supplement or waiver shall bind each Holder of a Security who has
consented to it and every subsequent Holder of a Security or portion of a
Security that evidences the same debt as the consenting Holder’s Security.


 


Section 12.05.  Notation on
or Exchange of Securities.


 


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


 


Section 12.06.  Trustee to
Sign Amendments, etc.


 


The Trustee shall
sign any amendment or supplemental indenture authorized pursuant to this Article 12
if the amendment or supplemental indenture does not adversely affect the
rights, duties, liabilities or immunities of the Trustee.  If it does, the Trustee may, in its sole
discretion, but need not sign it.  In
signing or refusing to sign such amendment or supplemental indenture, the
Trustee shall be entitled to receive, and, subject to Section 10.01, shall
be fully protected in relying upon, an Opinion of Counsel stating that such
amendment or supplemental indenture is


 


71

















 


authorized
or permitted by this Indenture.  The
Company may not sign an amendment or supplement indenture until the Board of
Directors approves it.


 


Section 12.07.  Effect of
Supplemental Indentures.


 


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


 


ARTICLE
13

MISCELLANEOUS


 


Section 13.01.  Trust
Indenture Act Controls.


 


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


 


Section 13.02.  Notices.


 


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


 


If to the Company, to:


Cephalon, Inc.


41 Moores Road,


Frazer, PA 19355


Attention: 
Chief Financial Officer


Facsimile No.:  (610) 738-6258


 


if to the Trustee, to:


 


U.S. Bank National Association


225 Asylum Street, 23rd Floor


Hartford, Connecticut 06103


Attention: 
Corporate Trust Services (Cephalon, Inc.


2.50% Convertible Senior Subordinated Notes
due


May 1, 2014)


Facsimile
No.:  (860) 241-6881


 


Such notices or
communications shall be effective when received.


 


72

















 


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


 


Failure to mail a
notice or communication to a Holder or any defect in it shall not affect its
sufficiency with respect to other Holders. 
If a notice or communication to a Holder is mailed in the manner
provided above or delivered electronically, it is duly given, whether or not
the addressee receives it.


 


In the event the
Company is required pursuant to this Indenture to deliver any notice, such
notice may be given by the Trustee on behalf of the Company.  The Company shall make any notice it is
required to deliver to Holders available on its website.


 


Section 13.03. 
Communications by Holders with Other Holders.


 


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


 


Section 13.04.  Certificate
and Opinion as to Conditions Precedent.


 


(a)        Upon any request or application by the
Company to the Trustee to take any action under this Indenture, the Company
shall furnish to the Trustee at the request of the Trustee:


 


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


 


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


 


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


 


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


 


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


 


73

















 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


Section 13.07.  Payment Day
or Record Date Not A Business Day.


 


If a payment date
is not a Business Day, payment shall be made on the next succeeding day that is
a Business Day, and no interest shall accrue for the intervening period.  If a regular record date is not a Business
Day, the record date shall not be affected.


 


Section 13.08.  Governing
Law.


 


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


 


Section 13.09.  No Adverse
Interpretation of Other Agreements.


 


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


 


74

















 


Section 13.10.  No Recourse
against Others.


 


All liability
described in paragraph 18 of the Securities of any director, officer, employee
or shareholder, as such, of the Company is waived and released.


 


Section 13.11.  Successors.


 


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


 


Section 13.12.  Multiple
Counterparts.


 


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


 


Section 13.13. 
Separability.


 


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


 


Section 13.14.  Table of
Contents, Headings, etc.


 


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


 


Section 13.15.  Submission
to Jurisdiction.


 


The Company (i) agrees
that any suit, action or proceeding against it arising out of or relating to
this Indenture or the Securities, as the case may be, may be instituted in any
federal or state court sitting in The City of New York; (ii) waives to the
fullest extent permitted by applicable law, any objection which it may now or
hereafter have to the laying of venue of any such suit, action or proceeding,
and any claim that any suit, action or proceeding in such a court has been
brought in an inconvenient forum; and (iii) submits to the non-exclusive
jurisdiction of such courts in any suit, action or proceeding.


 


[SIGNATURE
PAGE FOLLOWS]


 


75

















 


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


 


	
   

  	
  CEPHALON, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. Kevin Buchi

  
	
   

  	
   

  	
  Name:

  	
  J. Kevin Buchi

  
	
   

  	
   

  	
  Title:

  	
  Executive Vice President and

  Chief Financial Officer

  



 


 


	
   

  	
  U.S. BANK NATIONAL ASSOCIATION, as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Arthur L. Blakeslee

  
	
   

  	
   

  	
  Name:

  	
  Arthur L. Blakeslee

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  



 


INDENTURE
SIGNATURE PAGE


 
















 


EXHIBIT A


 


[THIS
SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF.


 


UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO CEPHALON, INC. (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 SECURITY 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 SECURITY 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. 
THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A
PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE.](1)


 






(1) Include
for Global Security.


 


A-1

















 


CEPHALON, INC.


 


	
  CUSIP: 156708AR0

  	
  No.

  



 


2.50% CONVERTIBLE SENIOR SUBORDINATED NOTES DUE MAY 1,
2014


 


Cephalon, Inc.,
a Delaware corporation (the “Company”, which term shall include any successor
corporation under the Indenture referred to on the reverse hereof), promises to
pay to [Cede & Co.]  (2), or registered assigns, the
principal sum of           [million]
dollars ($                  ) on May 1,
2014 or such greater or lesser amount as is indicated on the Schedule of
Exchanges of Securities on the other side of this Security.


 


This
Security is convertible as specified on the other side of this Security.
Additional provisions of this Security are set forth on the other side of this
Security.


 


[Signature
Page Follows]


 






(2) Include
for Global Security.


 


A-2

















 


IN WITNESS
WHEREOF, the Company has caused this instrument to be duly executed on the date
written below.


 


	
   

  	
   

  	
  CEPHALON, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Trustee’s Certificate of Authentication: This is one of the Securities
  referred to in the within-mentioned Indenture.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  U.S.BANK NATIONAL ASSOCIATION,

  	
   

  	
   

  
	
  as Trustee

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Authorized Signatory

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated: May 27, 2009(3)

  	
   

  	
   

  
					



 


 






(3) [Note
for form of security: Or such other date on which additional Securities may be
issued pursuant to the terms of the Indenture.]


 


A-3

















 


CEPHALON, INC.


 


2.50% CONVERTIBLE SENIOR
SUBORDINATED NOTES DUE MAY 1, 2014


 


1.             INTEREST AMOUNTS


 


Cephalon, Inc.,
a Delaware corporation (the “Company,” which term shall include any successor
corporation under the Indenture hereinafter referred to), will pay interest at
a rate of 2.50% per annum, on the principal amount of this Security payable as
provided in the Indenture.


 


2.             METHOD OF PAYMENT


 


The Company
shall pay any interest on this Security to the person who is the Holder of this
Security at the close of business on April 15 or October 15, as the
case may be, next preceding the related interest payment date. The Holder must
surrender this Security to a Paying Agent to collect payment of principal and
interest, if any.  Interest on the
Security will be paid at a rate of 2.50% per annum, payable semi-annually in
arrears on May 1 and November 1 of each year, or if any such day is
not a Business Day, the immediately following Business Day, commencing November 1,
2009.  Interest is computed on the basis
of a 360-day year comprised of twelve 30-day months.  In the event of the maturity, conversion or
purchase of the Security by the Company at the option of the Holder, interest
shall cease to accrue on the Security. 
However, the Company will pay interest on the maturity date to a Holder
of record of the Security on the record date immediately preceding the stated
maturity date regardless of whether such Holder converts the Security.


 


The Company
will make all payments in respect of a Global Security registered in the name
of the Depositary or its nominee to the Depositary or its nominee, as the case
may be, by wire transfer of immediately available funds to the account of the
Depositary or its nominee.  The Company
will make all payments in respect of a Certificated Security (including
principal and interest) in U.S. dollars at the office of the Trustee.  At the Company’s option, the Company may make
such payments by mailing a check to the registered address of each Holder
thereof as such address shall appear on the register or, if requested by a
Holder of more than $1,000,000 in aggregate principal amount of Securities, by
wire transfer of immediately available funds to the account specified by such
Holder.


 


3.             PAYING AGENT, REGISTRAR AND
CONVERSION AGENT


 


Initially,
U.S. Bank National Association (the “Trustee,” which term shall include any
successor trustee under the Indenture hereinafter referred to) will act as
Paying Agent, Registrar and Conversion Agent. The Company may appoint and
change any Paying Agent, Conversion Agent or Registrar without notice, other
than notice to the Trustee; provided
that the Company will maintain at least one Paying Agent in the United States
of America, which shall initially be an office or agency of the Trustee.  The Company or any of its Subsidiaries may,
subject to certain limitations set forth in the Indenture, act as Paying Agent
or Registrar.


 


A-4

















 


4.             INDENTURE, LIMITATIONS


 


This
Security is one of a duly authorized issue of Securities of the Company
designated as its 2.50% Convertible Senior Subordinated Notes due May 1,
2014 (the “Securities”), issued under an Indenture, dated as of May 27,
2009 (together with any supplemental indentures thereto, the “Indenture”),
between the Company and the Trustee. The terms of this Security include those
stated in the Indenture and those required by or made part of the Indenture by
reference to the Trust Indenture Act of 1939, as amended, as in effect on the
date of the Indenture. This Security is subject to all such terms, and the
Holder of this Security is referred to the Indenture and said Act for a
statement of them.


 


The
Securities are senior subordinated unsecured obligations of the Company
limited, except as set forth in the Indenture, to up to $500,000,000 aggregate
principal amount. The Indenture does not limit other debt of the Company,
secured or unsecured, including Senior Indebtedness.


 


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


 


At the
option of the Holder and subject to the terms and conditions of the Indenture,
the Company shall become obligated to purchase all or any part specified by the
Holder (so long as the principal amount of such part is $1,000 or an integral
multiple of $1,000 in excess thereof) of the Securities held by such Holder on
a date, determined by the Company in its sole discretion, that is not less than
20 Business Days and not more than 30 Business Days after the occurrence of a
Fundamental Change, at a purchase price equal to 100% of the principal amount
thereof, together with any accrued interest up to, but excluding, the
Fundamental Change Purchase Date, unless the Fundamental Change Purchase Date
is after a Record Date and on or prior to the related Interest Payment Date, in
which case interest accrued to the Interest Payment Date will be paid to Holders
of the Securities as of the preceding Record Date and the Fundamental Change
Purchase Price payable to any Holder surrendering such Holder’s Security for
purchase pursuant to Article 3 of the Indenture shall be equal to the
principal amount of Securities subject to purchase and will not include any
accrued and unpaid interest.  The
Fundamental Change Purchase Price shall be payable in cash. The Holder shall
have the right to withdraw any Fundamental Change Purchase Notice (in whole or
in a portion thereof that is $1,000 or an integral multiple of $1,000 in excess
thereof) at any time prior to 5:00 p.m., New York City time, on the second
Scheduled Trading Day immediately preceding the Fundamental Change Purchase
Date by delivering a written notice of withdrawal to the Paying Agent in
accordance with the terms of the Indenture.


 


6.             CONVERSION


 


A Holder of
a Security may convert the principal amount of such Security (or any portion
thereof equal to $1,000 or any integral multiple of $1,000 in excess thereof)
into cash and shares of Common Stock, if any, at any time prior to the close of
business on November 1, 2013, subject to the conditions, if any, set forth
in Section 5.01 of the Indenture; provided,
however, that, if the Security is subject to purchase upon a
Fundamental Change, the conversion right will terminate at the close of
business on the second Trading Day immediately preceding the Fundamental Change
Purchase Date for such Security or such earlier date as the Holder presents


 


A-5

















 


such
Security for purchase (unless the Company shall default in making the
Fundamental Change Purchase Price when due, in which case the conversion right
shall terminate at the close of business on the date such default is cured and
such Security is purchased).


 


The initial
Conversion Price is $69.00 per share, and the initial Conversion Rate is
14.4928 shares of Common Stock, in each case subject to adjustment under
certain circumstances as provided in the Indenture. No fractional shares will
be issued upon conversion; in lieu thereof, the Company will pay cash in an
amount determined by multiplying the Daily VWAP of a full share of Common Stock
on the last Trading Day of such Conversion Period by the fractional amount and
rounding the product to the nearest whole cent. 
Whether fractional shares are issuable upon a conversion will be
determined on the basis of the total number of Securities that the Holder is
then converting into cash and Common Stock, if any, and the aggregate number of
shares, if any, of Common Stock issuable upon such conversion.


 


To convert a
Security, a Holder must (a) complete and manually sign the conversion
notice set forth below and deliver such notice to a Conversion Agent, (b) surrender
the Security to a Conversion Agent, (c) furnish appropriate endorsements
and transfer documents if required by a Registrar or a Conversion Agent and (d) pay
any transfer or similar tax, if required. A Holder may convert a portion of a
Security equal to $1,000 or any integral multiple thereof.  In the case of a Security held by the
Depositary, such conversion shall be done in accordance with the applicable rules and
procedures of the Depositary.


 


A Security
in respect of which a Holder had delivered a Fundamental Change Purchase Notice
exercising the option of such Holder to require the Company to purchase such
Security may be converted only if the Fundamental Change Purchase Notice is
withdrawn in accordance with the terms of the Indenture.


 


7.             SUBORDINATION


 


The
indebtedness evidenced by the Securities is, to the extent and in the manner
provided in the Indenture, subordinate and junior in right of payment to the
prior payment in full of all Senior Indebtedness of the Company. Any Holder by
accepting this Security agrees to and shall be bound by such subordination
provisions and authorizes the Trustee to give them effect. In addition to all
other rights of Senior Indebtedness described in the Indenture, the Senior
Indebtedness shall continue to be Senior Indebtedness and entitled to the
benefits of the subordination provisions irrespective of any amendment,
modification or waiver of any terms of any instrument relating to the Senior
Indebtedness or any extension or renewal of the Senior Indebtedness.


 


8.             DENOMINATIONS, TRANSFER, EXCHANGE


 


The
Securities are in registered form, without coupons, in denominations of $1,000
and integral multiples of $1,000. A Holder may transfer or exchange Securities
in accordance with the Indenture. The Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents and to
pay any taxes or other governmental charges that may be imposed in relation
thereto by law or permitted by the Indenture.


 


A-6
















 


9.             PERSONS DEEMED OWNERS


 


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


 


10.           UNCLAIMED MONEY


 


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


 


11.           AMENDMENT, SUPPLEMENT AND WAIVER


 


Subject to
certain exceptions set forth in the Indenture, the Securities and the Indenture
may be amended or supplemented with the consent of the Holders of at least a
majority in aggregate principal amount of the Securities then outstanding, and
an existing default or Event of Default with respect to the Securities and its
consequence or compliance with any provision of the Securities or the Indenture
may be waived in a particular instance with the consent of the Holders of a
majority in aggregate principal amount of the Securities then outstanding.
Without the consent of or notice to any Holder, the Company and the Trustee may
amend or supplement the Indenture or the Securities to, among other things,
cure any ambiguity, defect or inconsistency or make any other change that does
not adversely affect the rights of any Holder.


 


12.          CALCULATIONS IN RESPECT OF SECURITIES


 


Except to
the extent provided therein, the Company will be responsible for making all
calculations called for under the Indenture and the Securities.  These calculations include, but are not
limited to, determinations of the Closing Sale Price of the Common Stock, adjustments
to the Conversion Price, any accrued interest payable on the Securities, the
Conversion Price and the Conversion Rate. 
The Company will make these calculations in good faith and, absent
manifest error, the calculations will be final and binding on Holders of the
Securities.  The Company will provide to
each of the Trustee and the Conversion Agent a schedule of its calculations,
and the Trustee and the Conversion Agent are entitled to rely conclusively upon
the accuracy of such calculations without independent verification.  The Trustee will forward the Company’s
calculations to any Holder of the Securities upon the request of such Holder.


 


13.           SUCCESSOR ENTITY


 


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


 


14.           DEFAULTS AND REMEDIES


 


Under the
Indenture, an “Event of Default” with respect to Securities shall occur if: (i) the
Company defaults in the payment of any principal of any Security when the same
becomes


 


A-7

















 


due and
payable (whether at maturity, upon required repurchase, following a Fundamental
Change or otherwise), whether or not such payment shall be prohibited by the
provisions of Article 6 of the Indenture; (ii) the Company fails to
pay the cash and deliver the shares of Common Stock, if any, representing the
Conversion Obligation upon conversion of any Security (including any Additional
Shares) within the time period required by the provisions of the Indenture,
whether or not such payment shall be prohibited by the provisions of Article 6
of the Indenture; (iii) the Company defaults in the payment of interest
when the same becomes due and payable and the default continues for a period of
30 days, whether or not such payment shall be prohibited by the provisions of Article 6
of the Indenture; (iv) the Company fails to perform or comply with any of
its other covenants or agreements contained in the Securities or in the
Indenture (other than a covenant or agreement a default in whose performance or
whose breach is specifically dealt with in clauses (i), (ii) or (iii) above)
and the default continues for 60 days after notice is given in accordance with
the Indenture; (v) the Company defaults in the payment of the purchase
price of any Security when the same becomes due and payable, whether or not
such payment shall be prohibited by the provisions of Article 6 of the
Indenture; (vi) the Company fails to provide a Fundamental Change Purchase
Notice when required by Section 3.01 of the Indenture; (vii) any
indebtedness under any bond, debenture, note or other evidence of indebtedness
for money borrowed by the Company or any Significant Subsidiary (or group of
Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary)
or under any mortgage, indenture or instrument under which there may be issued
or by which there may be secured or evidenced any indebtedness for money
borrowed by, or any other payment obligation of, the Company or any Significant
Subsidiary (or group of Subsidiaries that, taken as a whole, would constitute a
Significant Subsidiary) (an “Instrument”) with a principal amount then,
individually or in the aggregate, outstanding in excess of $10,000,000, whether
such indebtedness now exists or shall hereafter be created, is not paid at
final maturity of the Instrument (either at its stated maturity or upon
acceleration thereof) or when otherwise due or is accelerated, and such
indebtedness is not discharged, or such default in payment or acceleration is
not cured or rescinded, within a period of 30 days after there shall have been
given, by registered or certified mail, 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 Securities a written notice specifying such default
and requiring the Company to cause such indebtedness to be discharged or cause
such default to be cured or waived or such acceleration to be rescinded or
annulled and stating that such notice is a “Notice of Default” under the
Indenture; (viii) the Company or any Significant Subsidiary (or any group
of Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary) fails to pay one or more final and non-appealable judgments entered
by a court or courts of competent jurisdiction, the aggregate uninsured or
unbonded portion of which is in excess of $10,000,000, if the judgments are not
paid, discharged, waived or stayed within 30 days; or (ix) the Company or
any Significant Subsidiary (or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary) of the Company, pursuant to
or within the meaning of any Bankruptcy Law (as defined in the Indenture): (a) commences
a voluntary case or proceeding; (b) consents to the entry of an order for
relief against it in an involuntary case or proceeding; (c) consents to
the appointment of a Custodian of it or for all or substantially all of its
property; or (d) makes a general assignment for the benefit of its
creditors; or (x) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that: (a) is for relief against the
Company or any Significant Subsidiary (or any group of Subsidiaries that, taken
as a whole, would constitute a Significant Subsidiary) of the Company in an
involuntary case or proceeding; (b) appoints a Custodian of


 


A-8

















 


the Company
or any Significant Subsidiary (or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary) of the Company for all or
substantially all of the property of the Company or any such Significant
Subsidiary (or such group of Subsidiaries); or (c) orders the liquidation
of the Company or any Significant Subsidiary (or any group of Subsidiaries
that, taken as a whole, would constitute a Significant Subsidiary) of the
Company; and the case of each of clause (a), (b) and (c), the order or
decree remains unstayed and in effect for 60 consecutive days.


 


If an Event
of Default with respect to the Securities (other than as a result of certain
events of bankruptcy, insolvency or reorganization specified in the Indenture)
occurs and is continuing, the Trustee or the Holders of at least 25% in
aggregate principal amount of the Securities then outstanding may declare all
unpaid principal to the date of acceleration on the Securities then outstanding
to be due and payable immediately, all as and to the extent provided in the
Indenture. If an Event of Default occurs as a result of certain events of
bankruptcy, insolvency or reorganization specified in the Indenture, unpaid
principal of the Securities then outstanding shall become due and payable
immediately without any declaration or other act on the part of the Trustee or
any Holder, all as and to the extent provided in the Indenture. Holders may not
enforce the Indenture or the Securities except as provided in the Indenture.
The Trustee may require indemnity satisfactory to it before it enforces the
Indenture or the Securities. Subject to certain limitations, Holders of a
majority in aggregate principal amount of the Securities then outstanding may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders notice of any continuing default (except a default in
payment of principal or any interest) if it determines that withholding notice
is in their interests. The Company is required to file periodic reports with
the Trustee as to the absence of default.


 


Under the terms of
the Indenture, at the election of the Company in its sole discretion, the sole
remedy for an Event of Default relating to the failure to comply with Section 7.02
of the Indenture, and for any failure to comply with the requirements of Section 314(a)(1) of
the TIA, will consist, for the 180 days after the occurrence of such an Event
of Default, exclusively of the right to receive additional interest on the
notes at a rate equal to 0.50% per annum of the aggregate principal amount of
the Securities then outstanding up to, but not including, the 181st day
thereafter (or, if applicable, the earlier date on which the Event of Default relating
to the reporting obligations is cured or waived).  Any such additional interest will be paid and
calculated in the manner set forth in the Indenture.


 


15.           TRUSTEE DEALINGS WITH THE COMPANY


 


U.S. Bank
National Association, the Trustee under the Indenture, in its individual or any
other capacity, may make loans to, accept deposits from and perform services
for the Company or an Affiliate of the Company and may otherwise deal with the
Company or an Affiliate of the Company, as if it were not the Trustee.


 


16.           NO RECOURSE AGAINST OTHERS


 


A director,
officer, employee or shareholder, as such, of the Company shall not have any
liability for any obligations of the Company under the Securities or the
Indenture or for any claim based on, in respect of or by reason of such
obligations or their creation. The Holder of this


 


A-9

















 


Security by
accepting this Security waives and releases all such liability. The waiver and
release are part of the consideration for the issuance of this Security.


 


17.           AUTHENTICATION


 


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


 


18.           ABBREVIATIONS AND DEFINITIONS


 


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


 


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


 


19.           INDENTURE TO CONTROL; GOVERNING LAW


 


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


 


The Company
will furnish to any Holder, upon written request and without charge, a copy of
the Indenture. Requests may be made to: Cephalon, Inc., 41 Moores Road,
Frazer, PA 19355, (610) 344-0200, Attention: General Counsel.


 


A-10

















 


ASSIGNMENT FORM


 


To assign this Security, fill in the form
below:


 


I or we assign and transfer this Security to


 


	
   

  	
   

  
	
   

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

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

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

  
	
   

  	
   

  
	
   

  	
  and irrevocably appoint

  
	
   

  	
   

  
	
   

  	
   

  
	
   

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

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Your Signature:

  
	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

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

  
	
   

  	
   

  
	
   

  	
  *Signature guaranteed by:

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  



 






	
   

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

  



 


A-11

















 


CONVERSION NOTICE


 


	
   

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

  
	
   

  	
   

  
	
   

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

  
	
   

  	
   

  
	
   

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

  
	
   

  	
   

  
	
   

  	
   

  
	
   

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

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

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

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Your Signature:

  
	
  Date:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

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

  
	
   

  	
   

  
	
   

  	
  *Signature guaranteed by:

  
	
   

  	
   

  
	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  



 






	
   

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

  



 


A-12

















 


OPTION TO ELECT
REPURCHASE UPON A FUNDAMENTAL CHANGE


 


To: Cephalon, Inc.


 


The undersigned registered owner of this
Security hereby irrevocably acknowledges receipt of a notice from Cephalon, Inc.
(the “Company”) as to the occurrence of a Fundamental Change with respect to
the Company and requests and instructs the Company to redeem the entire
principal amount of this Security, or the portion thereof (which is $1,000 or
an integral multiple thereof) below designated, in accordance with the terms of
the Indenture referred to in this Security at a purchase price equal to the
Fundamental Change Purchase Price, payable in Cash.


 


	
  Dated:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

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

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Signature Guaranty

  
	
   

  	
   

  	
   

  
	
  Principal amount to be redeemed

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

  	
   

  	
   

  
				



 


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


 


A-13

















 


SCHEDULE OF EXCHANGES OF NOTES


 


The following exchanges, redemptions,
repurchases or conversions of a part of this global Security have been made:


 


	
  Principal
  Amount

  of this Global Security

  Following Such

  Decrease Date

  of Exchange (or Increase)

  	
   

  	
  Authorized

  Signatory of

  Securities

  Custodian

  	
   

  	
  Amount
  of Decrease in

  Principal Amount

  of this Global Security

  	
   

  	
  Amount
  of

  Increase in

  Principal Amount

  of this Global Security

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


A-14