Form of 2.90 Percent Note Due 2008



 



Exhibit 4.1



FORM OF



2.90% NOTE



CUSIP NO. 532457AW8

ISIN US532457AW85

Common Code 016534480



			
	 	UNLESS THIS GLOBAL NOTE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (“DTC”)
TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC AND ANY PAYMENT IS MADE TO CEDE & CO., 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.




			
	 	UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART
FOR NOTES IN DEFINITIVE FORM, THIS GLOBAL NOTE MAY NOT
BE TRANSFERRED EXCEPT AS A WHOLE BY DTC TO A NOMINEE
OF DTC, OR BY A NOMINEE OF DTC TO DTC OR ANOTHER
NOMINEE OF DTC, OR BY DTC OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY.



ELI LILLY AND COMPANY






2.90 % Note due 2008







	 	 
	REGISTERED

NO. R-1	
$300,000,000.00



     ELI LILLY AND COMPANY, an Indiana corporation (herein called the
“Company”), for value received, hereby promises to pay to CEDE & CO. or
registered assigns, the principal sum of THREE HUNDRED MILLION DOLLARS
($300,000,000.00) on March 15, 2008, upon surrender of this Global Note at the
office or agency of the Company for such payment in The City of New York, in
such coin or currency of the United States of America as at the time of payment
shall be legal tender for the payment of public and private debts, and to pay
interest on said principal sum until maturity at the rate of 2.90% per annum,
at such office or agency, in like coin or currency, semi-annually on March 15
and September 15 of each year, commencing September 15, 2003, until the date on
which payment of said principal sum has




 








 



been made or duly provided for; 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 shall appear in the Note Register.
Such interest shall be payable from the March 15 or the September 15, as the
case may be, next preceding the date hereof to which interest has been paid,
unless the date hereof is a March 15 or September 15 to which interest has been
paid, in which case from the date hereof, or unless the date hereof is prior to
the payment of any interest on the Notes, in which case from March 17, 2003;
provided, however, that if the Company shall default in payment of the interest
due on such March 15 or September 15 then from the March 15 or September 15 to
which interest has been paid or, if no interest has been paid on the Notes,
from March 17, 2003. The interest payable hereon on any interest payment date
shall be payable to the person in whose name this Note is registered at the
close of business on the last day of the calendar month preceding the month in
which such interest payment is due, except as otherwise provided in the
Indenture hereinafter referred to.





     The provisions of this Note are continued on the reverse hereof and such
continued provisions shall for all purposes have the same effect as though
fully set forth at this place.





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





[THIS SPACE INTENTIONALLY LEFT BLANK]






 








 



     IN WITNESS WHEREOF, ELI LILLY AND COMPANY has caused this Instrument to be
signed manually or by facsimile signature of its President or one of its Vice
Presidents and by its Secretary or one of its Assistant Secretaries, and a
facsimile of its corporate seal to be affixed hereto or imprinted hereon.






	 	 	 	 	 
	Dated:   March 17, 2003	 	 	 
	 
	 	 	ELI LILLY AND COMPANY
	 
	 
	 	 	By:	 
	 	 	 	

	 	 	 	Name:  Thomas W. Grein
	
	 	 	 	Title:  Vice President and Treasurer
	 
	 
	 	 	By:	 
	 	 	 	

	 	 	 	Name:  James B. Lootens
	
	 	 	 	Title:  Assistant Secretary





 








 



     This is one of the Notes of the series designated herein issued under the
Indenture described herein.






	 	 	 
	 	CITIBANK, N.A.,
	 	    as Trustee
	 
	 	By:	 
	 	 	


	 	 	
Authorized Officer



 








 



REVERSE OF NOTE






     This Note is one of a duly authorized issue of a series of debt securities
(the “Securities”) of the Company, designated as its 2.90% Notes due 2008 (the
“Notes”). The Notes are initially limited to $300,000,000 aggregate principal
amount and the Securities, including the Notes, are all issued or to be issued
under and pursuant to the Indenture dated as of February 1, 1991 (herein called
the “Indenture”), duly executed and delivered by the Company to Citibank, N.A.,
as Trustee (herein called the “Trustee”), to which Indenture and all Board
Resolutions (as defined in the Indenture) as provided therein, reference is
hereby made for a description of the rights, limitation of rights, obligations,
duties and immunities thereunder of the Trustee, the Company and holders of the
Notes. The Company may at any time issue additional notes under the Indenture
in unlimited amounts having the same terms as and treated as a single class
with the Notes for all purposes under the Indenture and will vote together as
one class with respect to the Notes.





     In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing with respect to the Notes, the principal hereof may
be declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the
Indenture. The Indenture provides that the holders of at least a majority in
aggregate principal amount of the Notes at the time outstanding may on behalf
of the holders of all of the Notes waive any past default under the Indenture
and its consequences, except a default in the payment of the principal of or
interest on any of the Notes, in the manner and to the extent provided in the
Indenture.





     The Indenture contains provisions permitting the Company and the Trustee,
with consent of the holders of not less than a majority of the aggregate
principal amount of the Notes at the time outstanding, evidenced as in the
Indenture provided, to execute supplemental indentures adding any provisions to
or changing in any manner or eliminating any of the provisions of the Indenture
or of any supplemental indenture with respect to the Notes, or modifying in any
manner the rights of the holders of the Notes; provided, however, that no
supplemental indenture shall (i) extend the maturity of any Note, or reduce the
principal amount thereof, or reduce the rate or extend the time of payment of
interest thereon, or make the principal thereof or interest thereon payable in
any coin or currency other than that in the Notes provided, without the consent
of the holder of each Note so affected, or (ii) reduce the aforesaid percentage
of Notes, the holders of which are required to consent to any such supplemental
indenture, without the consent of the holders of all Notes then outstanding.





     The Notes do not have a sinking fund.





     The Securities of this series are subject to redemption upon not less than
30 nor more than 60 days’ notice by mail, in whole or in part, at the election
of the Issuer at any time or from time to time, at a redemption price equal to
the greater of the following amounts:






	 	(i)	 	100% of the principal amount of the Securities
being redeemed on the redemption date; and





 








 




	 	(ii)	 	the sum of the present values of the remaining
scheduled payments of principal and interest on the Securities
being redeemed on the redemption date (not including the
amount, if any, of accrued and unpaid interest to the
redemption date) discounted to the redemption date on a
semiannual basis at the Treasury Rate (as defined below), as
determined by the Reference Treasury Dealer (as defined below)
plus 10 basis points;



plus, in each case, accrued and unpaid interest on the Securities to the
redemption date.





     Notwithstanding the foregoing, installments of interest on Securities that
are due and payable on interest payment dates falling on or prior to a
redemption date will be payable on the interest payment date to the registered
holders as of the close of business on the relevant record date according to
the Securities and the Indenture. The redemption price will be calculated on
the basis of a 360-day year consisting of twelve 30-day months.





     Once notice of redemption is mailed, the Securities called for redemption
will become due and payable on the redemption date at the applicable redemption
price, plus accrued and unpaid interest to the redemption date.





     “Treasury Rate” means, with respect to any redemption date, the rate per
annum equal to the semiannual equivalent yield to maturity of the Comparable
Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed
as a percentage of its principal amount) equal to the Comparable Treasury Price
for such redemption date.





     “Comparable Treasury Issue” means the United States Treasury security
selected by the Reference Treasury Dealer as having a maturity comparable to
the remaining term of the Securities to be redeemed that would be utilized, at
the time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable maturity to the
remaining term of the Securities.





     “Comparable Treasury Price” means, with respect to any redemption date,
(A) the average of the Reference Treasury Dealer Quotations for such redemption
date, after excluding the highest and lowest such Reference Treasury Dealer
Quotations, or (B) if the Trustee obtains two such Reference Treasury Dealer
Quotations, the average of both such Quotations, or (C) if only one Reference
Treasury Dealer Quotation is received, such Quotation.





     “Reference Treasury Dealer” means (A) Goldman, Sachs & Co., Credit Suisse
First Boston LLC and UBS Warburg LLC (or their respective affiliates which are
Primary Treasury Dealers), and their respective successors; provided, however,
that if any of the foregoing shall cease to be a primary U.S. Government
securities dealer in the United States (a “Primary Treasury Dealer”), the
Company will substitute therefor another Primary Treasury Dealer; and (B) any
other Primary Treasury Dealer(s) selected by the Company.





     “Reference Treasury Dealer Quotation” means, with respect to each
Reference Treasury Dealer and any redemption date, the average, as determined
by the Trustee, of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in
writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m. (New York
City time) on the third business day preceding such redemption date.







 







 



     No reference herein to the Indenture and no provision of this Note or of
the Indenture or of any Board Resolution shall alter or impair the obligation
of the Company, which is absolute and unconditional, to pay the principal of
and interest on this Note at the time and place and at the rate and in the coin
or currency herein prescribed.





     This Note is transferable by the registered holder hereof in person or by
his attorney duly authorized in writing on the books of the Company at the
office or agency to be maintained by the Company for that purpose in The City
of New York, but only in the manner, subject to the limitations and upon
payment of any tax or governmental charge for which the Company may require
reimbursement as provided in the Indenture, and upon surrender and cancellation
of this Note. Upon any registration of transfer, a new registered Note or
Notes, of authorized denomination or denominations, and in the same aggregate
principal amount, will be issued to the transferee in exchange therefor.





     The Company, the Trustee, any paying agent and any Note registrar may deem
and treat the registered holder hereof as the absolute owner of this Note
(whether or not this Note shall be overdue and notwithstanding any notations of
ownership or other writing hereon made by anyone other than the Note registrar)
for the purpose of receiving payment of or on account of the principal hereof
and interest due hereon as herein provided and for all other purposes, and
neither the Company nor the Trustee nor any paying agent nor any Note registrar
shall be affected by any notice to the contrary.





     No recourse shall be had for the payment of the principal of or interest
on this Note, or for any claim based hereon, or otherwise in respect hereof, or
based on or in respect of the Indenture or any indenture supplemental thereto
or any Board Resolution, against an incorporator, stockholder, officer or
director, as such, past, present or future, of the Company or of any successor
corporation, whether by virtue of any constitution, statute or rule of law, or
by the enforcement of any assessment or penalty or otherwise, all such
liability being, by the acceptance hereof and as part of the consideration for
the issue hereof, expressly waived and released.





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