Exhibit
4.1


 




 





EPIX MEDICAL, INC.


 


ISSUER


 


AND


 


U.S. BANK NATIONAL
ASSOCIATION,


 


TRUSTEE


 












 


INDENTURE


 


Dated as of
June 7, 2004


 












 


3% CONVERTIBLE
SENIOR NOTES DUE JUNE 15, 2024




 





 

















 


EPIX
MEDICAL, INC.

Reconciliation and tie between the Trust Indenture Act of 1939,

as amended, and the Indenture dated June 7, 2004


 


	
  Trust Indenture

  Act Section

  	
   

  	
  Indenture

  Section

  	
   

  
	
  § 310(a)

  	
  (1)

  	
   

  	
  6.8

  	
   

  
	
  (a)

  	
  (2)

  	
   

  	
  6.8

  	
   

  
	
  (a)

  	
  (3)

  	
   

  	
  N.A.

  	
   

  
	
  (a)

  	
  (4)

  	
   

  	
  N.A.

  	
   

  
	
  (a)

  	
  (5)

  	
   

  	
  6.8, 6.9

  	
   

  
	
  (b)

  	
   

  	
   

  	
  6.8, 6.9, 6.13

  	
   

  
	
  (c)

  	
   

  	
   

  	
  N.A.

  	
   

  
	
  § 311(a)

  	
   

  	
   

  	
  6.14

  	
   

  
	
  (b)

  	
   

  	
   

  	
  6.5

  	
   

  
	
  (c)

  	
   

  	
   

  	
  N.A.

  	
   

  
	
  § 312(a)

  	
   

  	
   

  	
  14.1

  	
   

  
	
  (b)

  	
   

  	
   

  	
  14.2(2)

  	
   

  
	
  (c)

  	
   

  	
   

  	
  14.2(3)

  	
   

  
	
  §313(a)

  	
   

  	
   

  	
  14.3

  	
   

  
	
  (b)

  	
  (1)

  	
   

  	
  N.A.

  	
   

  
	
  (b)

  	
  (2)

  	
   

  	
  14.3

  	
   

  
	
  (c)

  	
   

  	
   

  	
  1.6, 14.3

  	
   

  
	
  (d)

  	
   

  	
   

  	
  14.3(2)

  	
   

  
	
  § 314(a)

  	
   

  	
   

  	
  10.8, 10.9

  	
   

  
	
  (b)

  	
   

  	
   

  	
  N.A.

  	
   

  
	
  (c)

  	
  (1)

  	
   

  	
  1.3

  	
   

  
	
  (c)

  	
  (2)

  	
   

  	
  1.3

  	
   

  
	
  (c)

  	
  (3)

  	
   

  	
  N.A.

  	
   

  
	
  (d)

  	
   

  	
   

  	
  N.A.

  	
   

  
	
  (e)

  	
   

  	
   

  	
  1.3

  	
   

  
	
  (f)

  	
   

  	
   

  	
  N.A.

  	
   

  
	
  § 315(a)

  	
   

  	
   

  	
  6.1, 6.3

  	
   

  
	
  (b)

  	
   

  	
   

  	
  1.6, 6.2

  	
   

  
	
  (c)

  	
   

  	
   

  	
  6.1(2)

  	
   

  
	
  (d)

  	
   

  	
   

  	
  6.1(3)

  	
   

  
	
  (e)

  	
   

  	
   

  	
  5.14

  	
   

  
	
  § 316(a)

  	
  (last sentence)

  	
   

  	
  1.1(“Outstanding”)

  	
   

  
	
  (a)

  	
  (1)(A)

  	
   

  	
  5.12

  	
   

  
	
  (a)

  	
  (1)(B)

  	
   

  	
  5.13

  	
   

  
	
  (a)

  	
  (2)

  	
   

  	
  N.A.

  	
   

  
	
  (b)

  	
   

  	
   

  	
  5.8

  	
   

  
	
  (c)

  	
   

  	
   

  	
  1.4(5)

  	
   

  
	
  § 317(a)

  	
  (1)

  	
   

  	
  5.3

  	
   

  
	
  (a)

  	
  (2)

  	
   

  	
  5.4

  	
   

  
	
  (b)

  	
   

  	
   

  	
  10.3

  	
   

  
	
  § 318(a)

  	
   

  	
   

  	
  1.13

  	
   

  



 












N.A. means Not
Applicable.


NOTE:  This
reconciliation and tie shall not, for any purpose, be deemed to be a part of
the Indenture.


 

















 


TABLE
OF CONTENTS


 


	
   

  	
  Page

  
	
  ARTICLE I
  DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

  	
  1

  
	
  SECTION 1.1 Definitions.

  	
  1

  
	
  SECTION 1.2 Compliance Certificates and Opinions.

  	
  12

  
	
  SECTION 1.3 Form of Documents Delivered to the Trustee.

  	
  12

  
	
  SECTION 1.4 Acts of Holders of Securities.

  	
  13

  
	
  SECTION 1.5 Notices, Etc. to the Trustee and Company.

  	
  15

  
	
  SECTION 1.6 Notice to Holders of Securities; Waiver.

  	
  15

  
	
  SECTION 1.7 Effect of Headings and Table of Contents.

  	
  16

  
	
  SECTION 1.8 Successors and Assigns.

  	
  16

  
	
  SECTION 1.9 Severability Clause.

  	
  16

  
	
  SECTION 1.10
  Benefits of Indenture.

  	
  16

  
	
  SECTION 1.11 Governing Law.

  	
  16

  
	
  SECTION 1.12 Legal Holidays.

  	
  16

  
	
  SECTION 1.13 Conflict With Trust Indenture Act.

  	
  17

  
	
  SECTION 1.14 Execution In Counterparts.

  	
  17

  
	
  SECTION 1.15 Construction and Interpretation.

  	
  17

  
	
  ARTICLE II
  SECURITY FORMS

  	
  18

  
	
  SECTION 2.1 Form Generally.

  	
  18

  
	
  SECTION 2.2 Form of Security.

  	
  19

  
	
  SECTION 2.3 Form of Certificate of Authentication.

  	
  35

  
	
  SECTION 2.4 Form of Conversion Notice.

  	
  35

  
	
  SECTION 2.5 Form of Assignment.

  	
  37

  
	
  ARTICLE III
  THE SECURITIES

  	
  38

  
	
  SECTION 3.1 Title and Terms.

  	
  38

  
	
  SECTION 3.2 Denominations.

  	
  38

  
	
  SECTION 3.3 Execution, Authentication, Delivery and Dating.

  	
  38

  
	
  SECTION 3.4 Global Securities; Non-Global Securities; Book-Entry
  Provisions.

  	
  39

  
	
  SECTION 3.5 Registration; Registration of Transfer and Exchange;
  Restrictions on Transfer.

  	
  40

  
	
  SECTION 3.6 Mutilated, Destroyed, Lost or Stolen Securities.

  	
  44

  



 

















 


	
  SECTION 3.7 Payment of Interest; Interest Rights Preserved.

  	
  45

  
	
  SECTION 3.8 Persons Deemed Owners.

  	
  46

  
	
  SECTION 3.9 Cancellation.

  	
  46

  
	
  SECTION 3.10 Computation of Interest.

  	
  46

  
	
  SECTION 3.11 CUSIP Numbers.

  	
  46

  
	
  SECTION 3.12 Ranking.

  	
  46

  
	
  SECTION 3.13 Company Purchase of Securities.

  	
  47

  
	
  ARTICLE IV
  SATISFACTION AND DISCHARGE

  	
  47

  
	
  SECTION 4.1
  Satisfaction and Discharge of Indenture.

  	
  47

  
	
  SECTION 4.2
  Application of Trust Money.

  	
  48

  
	
  ARTICLE V
  REMEDIES

  	
  48

  
	
  SECTION 5.1
  Events of Default.

  	
  48

  
	
  SECTION 5.2 Acceleration of Maturity; Rescission and Annulment.

  	
  50

  
	
  SECTION 5.3 Collection of Indebtedness and Suits for Enforcement
  by Trustee.

  	
  51

  
	
  SECTION 5.4 Trustee May File Proofs of Claim.

  	
  51

  
	
  SECTION 5.5 Trustee May Enforce Claims Without Possession of
  Securities.

  	
  52

  
	
  SECTION 5.6 Application of Money Collected.

  	
  52

  
	
  SECTION 5.7 Limitation on Suits.

  	
  53

  
	
  SECTION 5.8 Unconditional Right of Holders to Receive Principal
  and Interest and to Convert.

  	
  53

  
	
  SECTION 5.9 Restoration of Rights and Remedies.

  	
  54

  
	
  SECTION 5.10 Rights and Remedies Cumulative.

  	
  54

  
	
  SECTION 5.11 Delay or Omission Not Waiver.

  	
  54

  
	
  SECTION 5.12 Control by Holders of Securities.

  	
  54

  
	
  SECTION 5.13 Waiver of Past Defaults.

  	
  55

  
	
  SECTION 5.14 Undertaking for Costs.

  	
  55

  
	
  SECTION 5.15 Waiver of Stay, Usury or Extension Laws.

  	
  55

  
	
  ARTICLE VI
  THE TRUSTEE

  	
  56

  
	
  SECTION 6.1 Certain Duties and Responsibilities.

  	
  56

  
	
  SECTION 6.2 Notice of Defaults.

  	
  57

  
	
  SECTION 6.3 Certain Rights of Trustee.

  	
  57

  
	
  SECTION 6.4 Not Responsible for Recitals or Issuance of
  Securities.

  	
  58

  
	
  SECTION 6.5 May Hold Securities, Act as Trustee under Other
  Indentures.

  	
  58

  



 


ii

















 


	
  SECTION 6.6 Money Held in Trust.

  	
  59

  
	
  SECTION 6.7 Compensation and Reimbursement.

  	
  59

  
	
  SECTION 6.8 Corporate Trustee Required; Eligibility.

  	
  60

  
	
  SECTION 6.9 Resignation and Removal; Appointment of Successor.

  	
  60

  
	
  SECTION 6.10
  Acceptance of Appointment by Successor.

  	
  61

  
	
  SECTION 6.11
  Merger, Conversion, Consolidation or Succession to Business.

  	
  61

  
	
  SECTION 6.12
  Authenticating Agents.

  	
  62

  
	
  SECTION 6.13
  Disqualification; Conflicting Interests.

  	
  63

  
	
  SECTION 6.14
  Preferential Collection of Claims Against Company.

  	
  63

  
	
  ARTICLE VII
  CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

  	
  63

  
	
  SECTION 7.1 Company May Consolidate, Etc. Only on Certain Terms.

  	
  63

  
	
  SECTION 7.2 Successor Substituted.

  	
  64

  
	
  ARTICLE VIII
  SUPPLEMENTAL INDENTURES

  	
  64

  
	
  SECTION 8.1 Supplemental Indentures Without Consent of Holders
  of Securities.

  	
  64

  
	
  SECTION 8.2 Supplemental Indentures with Consent of Holders of
  Securities.

  	
  65

  
	
  SECTION 8.3 Execution of Supplemental Indentures.

  	
  66

  
	
  SECTION 8.4 Effect of Supplemental Indentures.

  	
  67

  
	
  SECTION 8.5 Reference in Securities to Supplemental Indentures.

  	
  67

  
	
  SECTION 8.6 Notice of Supplemental Indentures.

  	
  67

  
	
  ARTICLE IX
  MEETINGS OF HOLDERS OF SECURITIES

  	
  67

  
	
  SECTION 9.1 Purposes for Which Meetings May Be Called.

  	
  67

  
	
  SECTION 9.2 Call, Notice and Place of Meetings.

  	
  67

  
	
  SECTION 9.3 Persons Entitled to Vote at Meetings.

  	
  68

  
	
  SECTION 9.4 Quorum; Action.

  	
  68

  
	
  SECTION 9.5 Determination of Voting Rights; Conduct and
  Adjournment of Meetings.

  	
  69

  
	
  SECTION 9.6 Counting Votes and Recording Action of Meetings.

  	
  70

  
	
  ARTICLE X
  COVENANTS

  	
  70

  
	
  SECTION 10.1 Payment of Principal and Interest.

  	
  70

  
	
  SECTION 10.2 Maintenance of Offices or Agencies.

  	
  70

  
	
  SECTION 10.3 Money for Security Payments to Be Held in Trust.

  	
  71

  
	
  SECTION 10.4
  Existence.

  	
  72

  
	
  SECTION 10.5 Maintenance of Properties.

  	
  72

  



 


iii

















 


	
  SECTION 10.6 Payment of Taxes and Other Claims.

  	
  72

  
	
  SECTION 10.7 Registration and Listing.

  	
  73

  
	
  SECTION 10.8 Statement by Officers as to Default.

  	
  73

  
	
  SECTION 10.9 Delivery of Certain Information.

  	
  73

  
	
  SECTION 10.10 Resale of Certain Securities.

  	
  74

  
	
  SECTION 10.11 Registration Rights.

  	
  74

  
	
  SECTION 10.12 Waiver of Certain Covenants.

  	
  74

  
	
  ARTICLE XI
  REDEMPTION OF SECURITIES

  	
  75

  
	
  SECTION 11.1 Right of Redemption.

  	
  75

  
	
  SECTION 11.2 Applicability of Article.

  	
  75

  
	
  SECTION 11.3 Election to Redeem; Notice to Trustee.

  	
  75

  
	
  SECTION 11.4 Selection by Trustee of Securities to Be Redeemed.

  	
  75

  
	
  SECTION 11.5 Notice of Redemption.

  	
  76

  
	
  SECTION 11.6 Deposit of Redemption Price.

  	
  77

  
	
  SECTION 11.7 Securities Payable on Redemption Date.

  	
  77

  
	
  SECTION 11.8 Conversion Arrangement on Call for Redemption.

  	
  78

  
	
  ARTICLE XII
  CONVERSION OF SECURITIES

  	
  78

  
	
  SECTION 12.1 Conversion Privilege and Conversion Rate.

  	
  78

  
	
  SECTION 12.2 Exercise of Conversion Privilege.

  	
  81

  
	
  SECTION 12.3 Fractions of Shares.

  	
  83

  
	
  SECTION 12.4 Adjustment of Conversion Rate.

  	
  83

  
	
  SECTION 12.5 Notice of Adjustments of Conversion Rate.

  	
  88

  
	
  SECTION 12.6 Notice of Certain Corporate Action.

  	
  89

  
	
  SECTION 12.7 Company to Reserve Common Stock.

  	
  90

  
	
  SECTION 12.8 Taxes on Conversions.

  	
  90

  
	
  SECTION 12.9 Covenant as to Common Stock.

  	
  90

  
	
  SECTION 12.10 Cancellation of Converted Securities.

  	
  90

  
	
  SECTION 12.11 Provision in Case of Consolidation, Merger or Sale
  of Assets.

  	
  91

  
	
  SECTION 12.12 Rights Issued in Respect of Common Stock.

  	
  92

  
	
  SECTION 12.13 Responsibility of Trustee for Conversion
  Provisions.

  	
  92

  
	
  ARTICLE XIII
  REPURCHASE OF SECURITIES AT THE OPTION OF THE HOLDER

  	
  93

  
	
  SECTION 13.1 Right to Require Repurchase upon a Designated
  Event.

  	
  93

  



 


iv

















 


	
  SECTION 13.2 Company’s Right To Elect Manner Of Payment Of
  Repurchase Price Upon the Occurrence of a Change in Control.

  	
  93

  
	
  SECTION 13.3 Notices; Method of Exercising Repurchase Right,
  Etc.

  	
  96

  
	
  SECTION 13.4 Certain Definitions.

  	
  98

  
	
  SECTION 13.5 Consolidation, Merger, Etc..

  	
  100

  
	
  SECTION 13.6 Repurchase at the Option of the Holder on Specified
  Purchase Dates.

  	
  100

  
	
  ARTICLE XIV
  HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY

  	
  102

  
	
  SECTION 14.1 Company to Furnish Trustee Names and Addresses of
  Holders.

  	
  102

  
	
  SECTION 14.2 Preservation of Information.

  	
  103

  
	
  SECTION 14.3 Reports by Trustee.

  	
  103

  
	
  SECTION 14.4 Reports by Company.

  	
  103

  
	
  ARTICLE XV
  IMMUNITY OF INCORPORATORS, STOCKHOLDERS, 
  OFFICERS AND DIRECTORS

  	
  104

  
	
  SECTION 15.1 Indenture and Securities Solely Corporate
  Obligations.

  	
  104

  
	
  ARTICLE XVI
  SUBORDINATION OF SECURITIES

  	
  104

  
	
  SECTION 16.1 Agreement To Subordinate.

  	
  104

  
	
  SECTION 16.2 Liquidation, Dissolution, Bankruptcy.

  	
  104

  
	
  SECTION 16.3 Default on Schering Indebtedness.

  	
  105

  
	
  SECTION 16.4 Acceleration of Payment of Securities.

  	
  106

  
	
  SECTION 16.5 When Distribution Must Be Paid Over.

  	
  107

  
	
  SECTION 16.6 Subrogation.

  	
  107

  
	
  SECTION 16.7 Relative Rights.

  	
  107

  
	
  SECTION 16.8 Subordination May Not Be Impaired by Company.

  	
  107

  
	
  SECTION 16.9 Notice to Trustee.

  	
  108

  
	
  SECTION 16.10 Distribution or Notice to Representative.

  	
  108

  
	
  SECTION 16.11 Article Sixteen Not To Prevent Events of
  Default or Limit Right To Accelerate.

  	
  108

  
	
  SECTION 16.12 Trust Moneys Not Subordinated.

  	
  108

  
	
  SECTION 16.13 Trustee Entitled To Rely.

  	
  109

  
	
  SECTION 16.14 Trustee To Effectuate Subordination.

  	
  109

  
	
  SECTION 16.15 Trustee Not Fiduciary for Holders of the Schering
  Indebtedness.

  	
  109

  
	
  SECTION 16.16 Reliance by Holders of the Schering Indebtedness
  on Subordination Provisions.

  	
  109

  
	
  SECTION 16.17 Certain Conversions Not Deemed Payment.

  	
  110

  



 


v

















 


INDENTURE, dated as of
June 7, 2004, between EPIX MEDICAL, INC., a corporation duly organized and
existing under the laws of the State of Delaware, having its principal office
at 71 Rogers Avenue, Cambridge, Massachusetts 02142 (herein called the
“Company”), and U.S. BANK NATIONAL ASSOCIATION, a national banking association
organized under the laws of the United States, as Trustee hereunder (herein
called the “Trustee”).


 


RECITALS OF THE COMPANY


 


The Company has duly
authorized the creation of an issue of its 3% Convertible Senior Notes due
June 15, 2024 (herein called the “Securities”) of substantially the tenor
and amount hereinafter set forth, and to provide therefor the Company has duly
authorized the execution and delivery of this Indenture.


 


All things necessary to
make the Securities, when the Securities are executed by the Company and
authenticated and delivered hereunder, the valid obligations of the Company,
and to make this Indenture a valid agreement of the Company, in accordance with
their and its terms, have been done. 
Further, all things necessary to duly authorize the issuance of the Common
Stock of the Company issuable upon the conversion of the Securities, and to
duly reserve for issuance the number of shares of Common Stock initially
issuable upon such conversion, have been done.


 


NOW, THEREFORE, THIS
INDENTURE WITNESSETH:


 


For and in consideration
of the premises and the purchase of the Securities by the Holders thereof, it
is mutually covenanted and agreed, for the equal and proportionate benefit of
all Holders of the Securities, as follows:


 


ARTICLE I


 


DEFINITIONS AND
OTHER PROVISIONS OF GENERAL APPLICATION


 


SECTION 1.1                          Definitions.  For all purposes of this Indenture, except
as otherwise expressly provided or unless the context otherwise requires:


 


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


 


(2)                                  all
accounting terms not otherwise defined herein have the meanings assigned to
them in accordance with generally accepted accounting principles in the United
States, and, except as otherwise herein expressly provided, the term “generally
accepted accounting principles” with respect to any computation required or
permitted hereunder shall mean such accounting principles as are generally
accepted at the date of such computation; and


 


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


 

















 


“Act,” when used with
respect to any Holder of a Security, has the meaning specified in Section 1.4.


 


“Additional Interest” has
the meaning specified in the Registration Rights Agreement.


 


“Affiliate” of any
specified Person means any other Person directly or indirectly controlling or
controlled by or under direct or indirect common control with such specified
Person.  For the purposes of this
definition, “control,” when used with respect to any specified 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 Member” means any
member of, or participant in, the Depositary.


 


“Applicable Procedures”
means, with respect to any transfer or transaction involving a Global Security
or beneficial interest therein, the rules and procedures of DTC or any
successor Depositary, in each case to the extent applicable to such transaction
and as in effect from time to time.


 


“Authenticating Agent”
means any Person authorized pursuant to Section 6.12 to act on behalf of
the Trustee to authenticate Securities.


 


“Blockage Notice” has the
meaning specified in Section 16.3.


 


“Board of Directors”
means either the board of directors of the Company or any duly authorized
committee of that board.


 


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


 


“Business Day,” when used
with respect to any Place of Payment, Place of Conversion or any other place,
as the case may be, means each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in such Place of Payment,
Place of Conversion or other place, as the case may be, are authorized or
obligated by law or executive order to close.


 


“Capital Stock” means any
and all shares, interests, participations, rights or other equivalents (however
designated) of corporate stock, including, without limitation, with respect to
partnerships, partnership interests (whether general or limited) and any other
interest or participation that confers on a Person the right to receive a share
of the profits and losses of, or distributions of assets of, such partnership.


 


“Change in Control” has
the meaning specified in Section 13.4(2).


 


“Closing Sale Price”
means, with respect to the Common Stock, for any day, (i) the last reported
sale price regular way on the Nasdaq National Market or (ii) if the Common
Stock is


 


2

















 


not quoted on the
Nasdaq National Market, the last reported sale price regular way per share or,
in case no such reported sale takes place on such day, the average of the
reported closing bid and asked prices regular way, in either case, on the
principal national securities exchange on which the Common Stock is listed or
admitted to trading, or (iii) if the Common Stock is not quoted on the Nasdaq
National Market or listed or admitted to trading on any national securities
exchange, the average of the closing bid and asked prices in the
over-the-counter market as reported by the National Quotation Bureau.


 


“Code” has the meaning
specified in Section 2.l.


 


“Commission” means the
United States Securities and Exchange Commission, as from time to time
constituted, created under the Exchange Act, or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.


 


“Common Stock” means the
shares of Common Stock, par value $0.01 per share, of the Company as it exists
on the date of this Indenture or any other shares of Capital Stock of the
Company into which the Common Stock shall be reclassified or changed or, in the
event of a merger, consolidation or other similar transaction involving the
Company that is otherwise permitted hereunder in which the Company is not the
surviving corporation, the common stock, common equity interests, ordinary
shares or depositary shares or other certificates representing common equity
interests of such surviving corporation or its direct or indirect parent
corporation.


 


“common stock” includes
any stock of any class of capital stock which has no preference in respect of
dividends or of amounts payable in the event of any voluntary or involuntary
liquidation, dissolution or winding up of the issuer thereof, which has
unrestricted voting rights and which is not subject to redemption by the issuer
thereof.


 


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


 


“Company Notice” has the
meaning specified in Section 13.3.


 


“Company Request” or
“Company Order” means a written request or order (i) signed in the name of the
Company by (A) one of its Chairman of the Board, its Vice Chairman of the
Board, its Chief Executive Officer, its President, an Executive Vice President
or a Vice President, and by (B) one of its principal financial officer,
Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary, provided, however, that with respect to
any Company Order delivered on the date hereof, such Company Order need only
contain the signature of one of the persons referenced in (A) above, and (ii)
delivered to the Trustee.


 


“Constituent Person” has
the meaning specified in Section 12.11.


 


“Conversion Agent” means
any Person authorized by the Company to convert Securities in accordance with
Article XII.  The Company has
initially appointed the Trustee as its Conversion Agent pursuant to
Section 10.2 hereof.


 


3

















 


“Conversion Date” means
the date on which a Holder delivers its Securities and a duly signed and
completed conversion notice pursuant to this Indenture.


 


“Conversion Price” has
the meaning specified in Section 13.4(3).


 


“Conversion Rate” has the
meaning specified in Section 12.1(c).


 


“Conversion Value” has
the meaning specified in Section 12.1(b).


 


“Corporate Trust Office”
means the office of the Trustee at which at any particular time the trust
created by this Indenture shall be principally administered (which at the date
of this Indenture is located at One Federal Street, 3rd Floor,
Boston, MA 02110, Attention: Corporate Trust Services (EPIX Medical, Inc., 3%
Convertible Senior Notes due June 15, 2024)).


 


“Current Market Price”
shall have the meaning specified in Section 12.4(3).


 


“Defaulted Interest” has
the meaning specified in Section 3.7.


 


“Depositary” means, with
respect to any Securities (including any Global Securities), a clearing agency
that is registered as such under the Exchange Act and is designated by the
Company to act as Depositary for such Securities (or any successor securities
clearing agency so registered).


 


“Designated Event” means
a Change in Control or a Termination of Trading.


 


“Distribution Notice” has
the meaning specified in Section 12.1.


 


“Documents” has the
meaning specified in Section 6.3(1).


 


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


 


“DTC” means The
Depository Trust Company, a New York corporation.


 


“Event of Default” has
the meaning specified in Section 5.1.


 


“Exchange Act” means the
United States Securities Exchange Act of 1934 (or any successor statute), as
amended from time to time.


 


“Expiration Date” has the
meaning specified in Section 12.4(1)(v).


 


“Expiration Time” has the
meaning specified in Section 12.4(1)(v).


 


“Global Security” means a
Security that is registered in the Security Register in the name of a
Depositary or a nominee thereof.


 


“Holder” means the Person
in whose name the Security is registered in the Security Register.


 


4

















 


“Indebtedness” means with respect to any Person, without
duplication, any liability of such Person (i) for borrowed money, (ii)
evidenced by bonds, debentures, notes or other similar instruments, (iii)
incurred or assumed as the deferred purchase price of property, or pursuant to
conditional sale obligations and title retention agreements (but excluding
trade accounts payable arising in the ordinary course of business), (iv) for
the reimbursement of any obligor on any letter of credit, banker’s acceptance
or similar credit transaction, (v) for Indebtedness of others guaranteed by
such Person, (vi) for interest rate swap agreements and other hedging
agreements and (vii) for Indebtedness of any other Person of the type referred
to in clauses (i) through (vi) which is secured by any Lien on any property or
asset of such first referred to Person.


 


“Indenture” means this
instrument as originally executed or as it may from time to time be supplemented
or amended by one or more indentures supplemental hereto entered into pursuant
to the applicable provisions hereof, including, for all purposes of this
instrument and any such supplemental indenture, the provisions of the Trust
Indenture Act that are deemed to be a part of and govern this instrument and
any such supplemental indenture, respectively.


 


“Initial Purchasers” mean
SG Cowen & Co., LLC, Needham & Company, Inc., Wells Fargo Securities,
LLC and WR Hambrecht + Co. LLC.


 


“Instrument” has the meaning
specified in Section 5.1.


 


“Interest Payment Date”
means the Stated Maturity of an installment of interest on the Securities.


 


“Issue Date” means the date on which the Securities are
originally issued.


 


“Lien” means, with respect to any asset, any lien, mortgage, deed
of trust, pledge, security interest, charge or encumbrance of any kind
(including any conditional sale or other title retention agreement, any lease
in the nature thereof and any agreement to give any security interest).


 


“Market Price” shall be
calculated by the Company and means the average of the daily volume-weighted
price of the Common Stock for the 20 consecutive trading-day period ending on
the third Business Day prior to the applicable Repurchase Date (or, if such
third Business Day prior to the applicable Repurchase Date is not a Trading
Day, then ending on the last Trading Day prior to such third Business Day),
appropriately adjusted to take into account the occurrence, during the period
commencing on the first Trading Day during the 20 trading-day period and ending
on the Repurchase Date, of any event that would result in an adjustment to the
Conversion Rate, as described in Section 12.4.


 


“Maturity,” when used
with respect to any Security, means the date on which the principal of such
Security becomes due and payable as therein or herein provided, whether at the
Stated Maturity or by declaration of acceleration, call for redemption,
exercise of the purchase or repurchase right set forth in Article XIII or
otherwise.


 


“Measurement Period” has
the meaning specified in Section 12.4(1)(iv).


 


5

















 


“Merger Notice” has the
meaning specified in Section 12.1(a).


 


“Non-electing Share” has
the meaning specified in Section 12.11.


 


“Non-Global Security”
means any Security issued under the conditions set forth in Section 3.4.


 


“Non-Payment Default” has
the meaning specified in Section 16.3.


 


“Notice of Default” has
the meaning specified in Section 5.1.


 


“Notice of Optional
Repurchase” has the meaning specified in Section 13.6(b).


 


“Notice of Withdrawal”
has the meaning specified in Section 13.6(c).


 


“Officers’ Certificate”
means a certificate (i) signed by (A) one of the Chairman of the Board, a Vice
Chairman of the Board, the Chief Executive Officer, the President, an Executive
Vice President, a Senior Vice President or a Vice President and by (B) one of
the principal financial officer, the Treasurer, an Assistant Treasurer, the
Secretary or an Assistant Secretary of the Company, and (ii) delivered to the
Trustee.  One of the Officers signing
any Officers’ Certificate required to be given pursuant to Section 10.8
shall be the principal executive, financial or accounting officer of the
Company.  The officers signing an
Officer’s Certificate may be the same person.


 


“Opinion of Counsel”
means a written opinion of counsel, who may be counsel for the Company and who
shall be acceptable to the Trustee in its reasonable discretion.


 


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


 


(i)                                     Securities
theretofore canceled by the Trustee or delivered to the Trustee for
cancellation;


 


(ii)                                  Securities
the payment or redemption for which money in the necessary amount has been
theretofore deposited with the Trustee or any Paying Agent (other than the
Company) in trust or set aside and segregated in trust by the Company (if the
Company shall act as its own Paying Agent) for the Holders of such Securities,
provided that if such Securities are to be redeemed, notice of such redemption
has been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made;


 


(iii)                               Securities
which have been paid pursuant to Section 3.6 or in exchange for or in lieu
of which other Securities have been authenticated and delivered pursuant to
this Indenture, other than any such Securities in respect of which there shall
have been presented to the Trustee proof satisfactory to it that such
Securities are held by a bona fide purchaser in whose hands such Securities are
valid obligations of the Company; and


 


6

















 


(iv)                              Securities
converted into Common Stock pursuant to Article XII;


 


provided,
however, that in determining
whether the Holders of the requisite principal amount of Outstanding Securities
are present at a meeting of Holders of Securities for quorum purposes or have
given any request, demand, authorization, direction, notice, consent or waiver
hereunder, Securities owned by the Company or any other obligor upon the
Securities or any Affiliate of the Company or such other obligor shall be
disregarded and deemed not to be Outstanding, except that, in determining
whether the Trustee shall be protected in relying upon any such determination
as to the presence of a quorum or upon any such request, demand, authorization,
direction, notice, consent or waiver, only Securities which a Responsible
Officer of the Trustee has been notified in writing to be so owned shall be so
disregarded.  Securities so owned which
have been pledged in good faith may be regarded as Outstanding if the pledgee
is not the Company or any other obligor upon the Securities or any Affiliate of
the Company or such other obligor, and the Trustee shall be protected in
relying upon an Officer’s Certificate to such effect.


 


“Paying Agent” means any
Person authorized by the Company to pay the principal of or interest on any
Securities on behalf of the Company and, except as otherwise specifically set
forth herein, such term shall include the Company if it shall act as its own
Paying Agent.  The Company has initially
appointed the Trustee as its Paying Agent pursuant to Section 10.2 hereof.


 


“Payment Blockage Period”
has the meaning specified in Section 16.3.


 


“Payment Default” has the
meaning specified in Section 16.3.


 


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


 


“Place of Conversion” has
the meaning specified in Section 3.1.


 


“Place of Payment” has
the meaning specified in Section 3.1.


 


“Predecessor Security” of
any particular Security means every previous Security evidencing all or a
portion of the same debt and rights as that evidenced by such particular
Security; and, for the purposes of this definition, any Security authenticated
and delivered under Section 3.6 in exchange for or in lieu of a mutilated,
destroyed, lost or stolen Security shall be deemed to evidence the same debt
and rights as the mutilated, destroyed, lost or stolen Security.


 


“Press Release” means any
press release issued by the Company and disseminated through any two of the
following News Services: Reuters Business News Services, Bloomberg News
Services and Dow Jones & Company Inc. (or any comparable news service if
one or more of the foregoing are not then available).


 


“Purchase Agreement”
means the Purchase Agreement, dated as of June 7, 2004, between the
Company and the Initial Purchasers, in connection with the Securities, as such
agreement may be amended from time to time.


 


“Purchase Date” has the
meaning specified in Section 13.6(a).


 


7

















 


“Purchase Notice” has the
meaning specified in Section 13.6(a).


 


“Purchase Price” has the
meaning specified in Section 13.6(a).


 


“Purchased Shares” has
the meaning specified in Section 12.4(1)(v).


 


“Purchasers” has the
meaning specified in Section 11.8.


 


“Qualified Institutional
Buyer” shall mean a “qualified institutional buyer” as defined in Rule 144A.


 


“Record Date” means any
Regular Record Date or Special Record Date.


 


“Record Date Period”
means the period from the close of business on any Regular Record Date next
preceding any Interest Payment Date to the opening of business on such Interest
Payment Date.


 


“Redemption Date,” when
used with respect to any Security to be redeemed, means the date fixed for such
redemption by or pursuant to this Indenture.


 


“Redemption Price,” when
used with respect to any Security to be redeemed, means the price set forth in
Section 2.2.


 


“Registrable Securities”
has the meaning specified in the Registration Rights Agreement.


 


“Registration Rights
Agreement” means the Registration Rights Agreement, dated as of June 7,
2004, between the Company and the Initial Purchasers, in connection with the
Securities, as such agreement may be amended from time to time.


 


“Regular Record Date” for
interest payable in respect of any Security on any Interest Payment Date means
the June 1 or December 1 (whether or not a Business Day), as the case
may be, next preceding such Interest Payment Date.


 


“Representative” means the agent or representative in respect of
the Schering Indebtedness; provided, however, that if, and for so
long as, the Schering Indebtedness lacks such a representative, then Schering
shall at all times constitute the Representative for the Schering Indebtedness.


 


“Repurchase Date” has the
meaning specified in Section 13.1.


 


“Repurchase Notice” has
the meaning specified in Section 13.3(2).


 


“Repurchase Price” has
the meaning specified in Section 13.1.


 


“Responsible Officer,”
when used with respect to the Trustee, means any officer within the Corporate
Trust Office of the Trustee with direct responsibility for the administration
of this Indenture and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of his
knowledge and familiarity with the particular subject.


 


8

















 


“Restricted Global
Security” has the meaning specified in Section 2.1.


 


“Restricted Non-Global
Security” means any Non-Global Security bearing the Restricted Securities
Legend.


 


“Restricted Securities”
means all Securities required pursuant to Section 3.5(3) to bear any
Restricted Securities Legend.  Such term
includes the Restricted Global Security.


 


“Restricted Securities
Legend” means, collectively, the legends substantially in the forms of the
legends required in the form of Security set forth in Section 2.2 to be
placed upon each Restricted Security.


 


“Rights” means any common
stock or preferred stock purchase right, as the case may be, that all shares of
Common Stock are entitled to receive under a Rights Plan.


 


“Rights Plan” shall mean
a preferred shares rights plan or any similar plan adopted by the Company.


 


“Rule 144” means Rule 144
under the Securities Act (or any successor provision), as it may be amended
from time to time.


 


“Rule 144A” means Rule 144A
under the Securities Act (or any successor provision), as it may be amended
from time to time.


 


“Rule 144A Information”
has the meaning specified in Section 10.9.


 


“Schering” means Schering
Aktiengesellschaft.


 


“Schering Indebtedness”
means the obligations of the Company pursuant to the Schering Loan Agreement,
not to exceed $15,000,000 in principal amount plus accrued and unpaid interest
(including but not limited to any interest arising after the filing of any
bankruptcy petition or commencement of other insolvency proceedings by or
against the Company), as well as all reasonable costs and expenses of
collection, which obligations are secured by the Schering Security Agreement.


 


“Schering Loan Agreement”
means that certain Loan Agreement by and between the Company and Schering dated
May 26, 2003, as may be amended from time to time, provided however, that no
such amendments shall increase the maximum principal amount of loans available
to the Company.


 


“Schering Security
Agreement” means that certain Security Agreement between the Company and
Schering dated May 26, 2003, as may be amended from time to time.


 


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


 


“Securities Act” means
the United States Securities Act of 1933 (or any successor statute), as amended
from time to time.


 


9

















 


“Security Register” and
“Security Registrar” have the respective meanings specified in
Section 3.5(1).


 


“Senior Indebtedness” means, whether outstanding on the Issue
Date or thereafter issued, all Indebtedness of the Company, including interest
(including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company whether or not a claim
for post-filing interest is allowed in such proceeding) and premium, if any,
thereon, and other monetary amounts (including fees, expenses, reimbursement
obligations under letters of credit and indemnities) owing in respect thereof unless,
in the instrument creating or evidencing the same or pursuant to which the same
is outstanding, it is provided that the obligations in respect of such
Indebtedness are expressly subordinate or junior in right of payment to the
Securities.


 


“Shelf Registration
Statement” has the meaning specified in Section 2(a) of the Registration
Rights Agreement.


 


“Significant Subsidiary”
has the meaning set forth in Rule 1-02(w) of Regulation S-X under the Exchange
Act, except that references therein to income from continuing operations are
changed to revenues.


 


“Special Record Date” for
the payment of any Defaulted Interest means a date fixed by the Company
pursuant to Section 3.7(1).


 


“Spin-off” has the
meaning specified in Section 12.4(1)(iv).


 


“Stated Maturity,” when
used with respect to any Security or any installment of interest thereon, means
the date specified in such Security as the fixed date on which the principal of
such Security or such installment of interest is due and payable.


 


“Subsidiary” means a corporation,
partnership, limited liability corporation or any similar legal entity, more
than 50% of the outstanding voting stock or voting interests of which is owned,
directly or indirectly, by the Company or by one or more other Subsidiaries, or
by the Company and one or more other Subsidiaries.  For the purposes of this definition, “voting stock” means stock
or other similar interests in the corporation, partnership, limited liability
corporation or other entity which ordinarily has or have voting power for the
election of directors, or persons performing similar functions, whether at all
times or only so long as no senior class of stock or other interests has or
have such voting power by reason of any contingency.


 


“Subsidiary Closing
Price” means, with respect to the securities of a Subsidiary distributed in a
Spin-off, for any day, (i) the last reported sale price regular way on the New
York Stock Exchange, or (ii) if such security is not listed on the New York
Stock Exchange, the last reported sale price regular way per share or, in case
no such reported sale takes place on such day, the average of the reported
closing bid and asked prices regular way, in either case, on the principal
national securities exchange on which such security is listed or admitted to
trading or quoted on the Nasdaq National Market or any other system of
automated dissemination of quotation of securities prices, or (iii) if such
security is not listed on the New York Stock Exchange or listed or admitted to
trading on any national securities exchange, the average of the


 


10

















 


closing bid prices
in the over-the-counter market as furnished by any New York Stock Exchange
member firm selected from time to time by the Company for that purpose.


 


“Successor Security” of
any particular Security means every Security issued after, and evidencing all
or a portion of the same debt as that evidenced by, such particular Security;
and, for the purposes of this definition, any Security authenticated and
delivered under Section 3.6 in exchange for or in lieu of a mutilated,
destroyed, lost or stolen Security shall be deemed to evidence the same debt as
the mutilated, destroyed, lost or stolen Security.


 


“Surrender Certificate”
means a certificate substantially in the form set forth in Annex B.


 


“Surrendered Securities”
has the meaning given to such term in Annex B.


 


“Termination of Trading”
means the Common Stock (or other common stock into which the Securities are
convertible) is neither listed for trading on a U.S. national securities
exchange nor approved for listing on the Nasdaq National Market or any similar
U.S. system of automated dissemination of quotations of securities prices, and
no American Depositary Shares or similar instruments for such common stock are
so listed or approved for listing in the U.S.


 


“Trading Day” means (i)
if the Common Stock is quoted on the Nasdaq National Market or any other system
of automated dissemination of quotations of securities prices, days on which
trades may be effected through such system, (ii) if the Common Stock is listed
or admitted for trading on any national or regional securities exchange, days
on which such national or regional securities exchange is open for business, or
(iii) if the Common Stock is not listed on a national or regional securities
exchange or quoted on the Nasdaq National Market or any other system of
automated dissemination of quotation of securities prices, days on which the
Common Stock is traded regular way in the over-the-counter market and for which
a closing bid and a closing asked price for the Common Stock are available.


 


“Trading Price” has the
meaning specified in Section 2.2.


 


“Trigger Event” has the
meaning specified in Section 12.12.


 


“Trust Indenture Act”
means the Trust Indenture Act of 1939, and the rules and regulations
thereunder, as in force at the date as of which this instrument was executed; provided, however, that in the event the
Trust Indenture Act of 1939 is amended after such date, “Trust Indenture Act”
means, to the extent required by any such amendment, the Trust Indenture Act of
1939, and the rules and regulations thereunder, as so amended.


 


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


 


“United States” means the
United States of America (including the 50 States and the District of
Columbia), its territories, its possessions and other areas subject to its
jurisdiction (its “possessions” including Puerto Rico, the U.S. Virgin Islands,
Guam, American Samoa, Wake Island and the Northern Mariana Islands).


 


11

















 


“Unrestricted Securities
Certificate” means a certificate substantially in the form set forth in
Annex A.


 


SECTION 1.2                          Compliance
Certificates and Opinions.


 


Upon any application or
request by the Company to the Trustee to take any action under any provision of
this Indenture, the Company shall furnish to the Trustee an Officers’
Certificate stating that there has been compliance with all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action and an Opinion of Counsel stating that in the opinion of such counsel
there has been compliance with all such conditions precedent, if any, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate
or opinion need be furnished.


 


Every certificate or
opinion with respect to compliance with a condition or covenant provided for in
this Indenture (including certificates provided for in Section 10.8) shall
include:


 


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


 


(2)                                  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;


 


(3)                                  a
statement that, in the opinion of such individual, he has made such examination
or investigation as is necessary to enable him to express an informed opinion
as to whether or not there has been compliance with such covenant or condition;
and


 


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


 


SECTION 1.3                          Form
of Documents Delivered to the Trustee.


 


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


 


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


 


12

















 


exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to such matters are erroneous.


 


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


 


SECTION 1.4                          Acts
of Holders of Securities.


 


(1)                                  Any
request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Indenture to be given or taken by Holders
of Securities may be embodied in and evidenced by (A) one or more instruments
of substantially similar tenor signed by such Holders in person or by an agent
or proxy duly appointed in writing by such Holders or (B) the record of Holders
of Securities voting in favor thereof, either in person or by proxies duly
appointed in writing, at any meeting of Holders of Securities duly called and
held in accordance with the provisions of Article IX.  Such action shall become effective when such
instrument or instruments or record is delivered to the Trustee and, where it
is hereby expressly required, to the Company. 
The Trustee shall be authorized and permitted to deliver to the Company
copies of all such instruments and records delivered to the Trustee.  Such instrument or instruments and records
(and the action embodied therein and evidenced thereby) are herein sometimes
referred to as the “Act” of the Holders of Securities signing such instrument
or instruments and so voting at such meeting. 
Proof of execution of any such instrument or of a writing appointing any
such agent or proxy, or of the holding by any Person of a Security, shall be
sufficient for any purpose of this Indenture and (subject to Section 6.1)
conclusive in favor of the Trustee and the Company if made in the manner
provided in this Section.  The record of
any meeting of Holders of Securities shall be proved in the manner provided in
Section 9.6.


 


(2)                                  The
fact and date of the execution by any Person of any such instrument or writing
may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such
instrument or writing acknowledged to him the execution thereof.  Where such execution is by a signer acting
in a capacity other than his individual capacity, such certificate or affidavit
shall also constitute sufficient proof of his authority.


 


(3)                                  The
principal amount and serial number of any Security held by any Person, and the
date of his holding the same, shall be proved by the Security Register.  As to any matter relating to beneficial
ownership interests in any Global Security, the appropriate depositary’s
records shall be dispositive for purposes of this Indenture.


 


(4)                                  The
fact and date of execution of any such instrument or writing and the authority
of the Person executing the same may also be proved in any other reasonable
manner which the Trustee deems sufficient; and the Trustee may reasonably
require further proof with respect to any of the matters referred to in this
Section 1.4.


 


(5)                                  The
Company may set any day as the record date for the purpose of determining the
Holders entitled to give or take any request, demand, authorization, direction,
notice, consent, waiver or other action, or to vote on any action, authorized
or permitted by this Indenture to be


 


13

















 


given or taken by Holders.  Promptly and in any case not later than 10 days after setting a
record date, the Company shall notify the Trustee and the Holders of such
record date.  If not set by the Company
prior to the first solicitation of a Holder made by any Person in respect of
any such action, or, in the case of any such vote, prior to such vote, the
record date for any such action or vote shall be the 30th day (or, if later,
the date of the most recent list of Holders required to be provided pursuant to
Section 14.1) prior to such first solicitation or vote, as the case may
be.  With regard to any record date, the
Holders on such date (or their duly appointed agents or proxies), and only such
Persons, shall be entitled to give or take, or vote on, the relevant action,
whether or not such Holders remain Holders after such record date.  Notwithstanding the foregoing, the Company
shall not set a record date for, and the provisions of this paragraph shall not
apply with respect to, any notice, declaration or direction referred to in the
next paragraph.


 


Upon receipt by the
Trustee from any Holder of (i) any notice of default or breach referred to in
Section 5.1(6), if such default or breach has occurred and is continuing
and the Trustee shall not have given such a notice to the Company, (ii) any
declaration of acceleration referred to in Section 5.2, if an Event of
Default has occurred and is continuing and the Trustee shall not have given
such a declaration to the Company, or (iii) any direction referred to in
Section 5.12, if the Trustee shall not have taken the action specified in
such direction, then, with respect to clauses (ii) and (iii), a record date
shall automatically and without any action by the Company or the Trustee be set
for determining the Holders entitled to join in such declaration or direction,
which record date shall be the close of business on the tenth day (or, if such
day is not a Business Day, the first Business Day thereafter) following the day
on which the Trustee receives such declaration or direction, and, with respect
to clause (i), the Trustee may set any day as a record date for the purpose of
determining the Holders entitled to join in such notice of default.  Promptly after such receipt by the Trustee
of any such declaration or direction referred to in clause (ii) or (iii), and
promptly after setting any record date with respect to clause (i), and as soon
as practicable thereafter, the Trustee shall notify the Company and the Holders
of any such record date so fixed.  The
Holders on such record date (or their duly appointed agents or proxies), and
only such Persons, shall be entitled to join in such notice, declaration or
direction, whether or not such Holders remain Holders after such record date;
provided that, unless such notice, declaration or direction shall have become
effective by virtue of Holders of the requisite principal amount of Securities
on such record date (or their duly appointed agents or proxies) having joined
therein on or prior to the 90th day after such record date, such notice,
declaration or direction shall automatically and without any action by any
Person be canceled and of no further effect. 
Nothing in this paragraph shall be construed to prevent a Holder (or a
duly appointed agent or proxy thereof) from giving, before or after the
expiration of such 90-day period, a notice, declaration or direction contrary
to or different from, or, after the expiration of such period, identical to,
the notice, declaration or direction to which such record date relates, in
which event a new record date in respect thereof shall be set pursuant to this
paragraph.  In addition, nothing in this
paragraph shall be construed to render ineffective any notice, declaration or
direction of the type referred to in this paragraph given at any time to the
Trustee and the Company by Holders (or their duly appointed agents or proxies)
of the requisite principal amount of Securities on the date such notice,
declaration or direction is so given.


 


(6)                                  Any
request, demand, authorization, direction, notice, consent, election, waiver or
other Act of the Holder of any Security shall bind every future Holder of the
same Security and the Holder of every Security issued upon the registration of
transfer thereof or in exchange


 


14

















 


therefor or in lieu thereof in respect of anything
done, omitted or suffered to be done by the Trustee or the Company in reliance
thereon, whether or not notation of such action is made upon such Security.


 


(7)                                  The
provisions of this Section 1.4 are subject to the provisions of
Section 9.5.


 


SECTION 1.5                          Notices,
Etc. to the Trustee and Company.


 


Any request, demand,
authorization, direction, notice, consent, election, waiver or other Act of
Holders of Securities or other document provided or permitted by this Indenture
to be made upon, given or furnished to, or filed with,


 


(1)                                  the
Trustee by any Holder of Securities or by the Company shall be sufficient for
every purpose hereunder if made, given, furnished or filed in writing, mailed,
first-class postage prepaid, or telecopied and confirmed by mail, first-class
postage prepaid, or delivered by hand or overnight courier, addressed to the
Trustee at U.S. Bank National Association, One Federal Street, 3rd
Floor, Boston, MA 02110, Attention: Corporate Trust Department, or at any other
address previously furnished in writing to the Holders of Securities by the
Trustee to or with a Responsible Officer of the Trustee and received at its
Corporate Trust Office; or


 


(2)                                  the
Company by the Trustee or by any Holder of Securities shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if in
writing, mailed, first-class postage prepaid, or telecopied and confirmed by
mail, first-class postage prepaid, or delivered by hand or overnight courier,
addressed to the Company at 71 Rogers Avenue, Cambridge, Massachusetts 02142,
Attention: Chief Financial Officer, or at any other address previously
furnished in writing to the Trustee by the Company.


 


SECTION 1.6                          Notice
to Holders of Securities; Waiver.


 


Except as otherwise
expressly provided herein, where this Indenture provides for notice to Holders of
Securities of any event, such notice shall be sufficiently given to Holders if
in writing and mailed, first-class postage prepaid or delivered by an overnight
delivery service, to each Holder of a Security affected by such event, at the
address of such Holder as it appears in the Security Register, not earlier than
the earliest date and not later than the latest date prescribed for the giving
of such notice.


 


Neither the failure to
mail such notice, nor any defect in any notice so mailed, to any particular
Holder of a Security shall affect the sufficiency of such notice with respect
to other Holders of Securities.  In case
by reason of the suspension of regular mail service or by reason of any other
cause it shall be impracticable to give such notice by mail, then such
notification to Holders of Securities as shall be made with the approval of the
Trustee, which approval shall not be unreasonably withheld, shall constitute a
sufficient notification to such Holders for every purpose hereunder.


 


Such notice shall be
deemed to have been given when such notice is mailed, whether or not such
Holder actually receives such notice.


 


15

















 


Where this Indenture
provides for notice in any manner, such notice may be waived in writing by the
Person entitled to receive such notice, either before or after the event, and
such waiver shall be the equivalent of such notice.  Waivers of notice by Holders of Securities shall be filed with the
Trustee, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.


 


SECTION 1.7                          Effect
of Headings and Table of Contents.


 


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


 


SECTION 1.8                          Successors
and Assigns.


 


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


 


SECTION 1.9                          Severability
Clause.


 


In case any provision in
this Indenture or 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 1.10                    Benefits
of Indenture.


 


Subject to
Section 3.13, nothing in this Indenture or in the Securities, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder, any Paying Agent, Conversion Agent and the Holders of
Securities, any benefit or legal or equitable right, remedy or claim under this
Indenture.


 


SECTION 1.11                    Governing
Law.


 


THIS
INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, THE UNITED STATES OF AMERICA
INCLUDING, WITHOUT LIMITATION, SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK
GENERAL OBLIGATIONS LAW AND NEW YORK CIVIL PRACTICE LAWS AND RULE 327(B).


 


SECTION 1.12                    Legal
Holidays.


 


In any case where any
Interest Payment Date, Redemption Date, Repurchase Date, Purchase Date or
Stated Maturity of any Security or the last day on which a Holder of a Security
has a right to convert his Security shall not be a Business Day at a Place of
Payment or Place of Conversion, as the case may be, then (notwithstanding any
other provision of this Indenture or of the Securities) payment of principal of
or interest on, or the payment of the Redemption Price, Purchase Price or
Repurchase Price (whether the same is payable in cash or in shares of Common
Stock, as the case may be) with respect to, or delivery for conversion of, such
Security need not be made at such Place of Payment or Place of Conversion, as
the case may be, on or by such day, but may be made on or by the next
succeeding Business Day at such Place of Payment 


 


16

















 


or Place of
Conversion, as the case may be, with the same force and effect as if made on
the Interest Payment Date, Redemption Date, Repurchase Date, Purchase Date or
at the Stated Maturity or by such last day for conversion; provided, however, that in the case that
payment is made on such succeeding Business Day, no interest shall accrue on
the amount so payable for the period from and after such Interest Payment Date,
Redemption Date, Repurchase Date, Purchase Date, Stated Maturity or last day
for conversion, as the case may be.


 


SECTION 1.13                    Conflict
With Trust Indenture Act.


 


If any provision hereof
limits, qualifies or conflicts with a provision of the Trust Indenture Act that
is required under such Act to be a part of and govern this Indenture, the
latter provision shall control.  If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act that may be so modified or excluded, the latter provision shall
be deemed to apply to this Indenture as so modified or to be excluded, as the
case may be.  Until such time as this
Indenture shall be qualified under the Trust Indenture Act, this Indenture, the
Company and the Trustee shall be deemed for all purposes hereof to be subject
to and governed by the Trust Indenture Act to the same extent as would be the
case if this Indenture were so qualified on the date hereof.


 


SECTION 1.14                    Execution In Counterparts.


 


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


 


SECTION 1.15                    Construction and Interpretation.


 


Whenever in this
Indenture there is a reference, in any context, to the payment of interest on,
or in respect of, any Security, such mention shall be deemed to include mention
of the payment of Additional Interest payable as described in the Registration
Rights Agreement and express mention of the payment of Additional Interest (if
applicable) in any provisions of this Indenture shall not be construed as
excluding Additional Interest in those provisions of this Indenture where such
express mention is not made.


 


Whenever in this
Indenture there is a reference, in any context, to the principal of any
Security as of any time, such reference shall be deemed to include reference to
the Repurchase Price or Redemption Price, as applicable, payable in respect of
such Security and express mention of the Repurchase Price or Redemption Price,
as applicable, in any provision of this Indenture shall not be construed as
excluding the Repurchase Price or Redemption Price, as applicable, so payable
in those provisions of this Indenture when such express mention is not made.


 


17

















 


ARTICLE II


 


SECURITY FORMS


 


SECTION 2.1                          Form
Generally.


 


The Securities shall be
in substantially the form set forth in this Article, with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture, and may have such letters, numbers or other marks
of identification and such legends or endorsements placed thereon as may be
required to comply with the rules of any securities exchange, the Internal
Revenue Code of 1986, as amended, and regulations thereunder (the “Code”), or
as may, consistent herewith, be determined by the officers executing such
Securities, as evidenced by their execution thereof.  All Securities shall be in fully registered form.


 


The Trustee’s
certificates of authentication shall be in substantially the form set forth in
Section 2.3.


 


Conversion notices shall
be in substantially the form set forth in Section 2.4.


 


Repurchase notices shall
be substantially in the form set forth in Section 2.2.


 


The Securities shall be
printed, lithographed, typewritten or engraved or produced by any combination
of these methods or may be produced in any other manner permitted by the rules
of any automated quotation system or securities exchange (including on steel
engraved borders if so required by any securities exchange upon which the
Securities may be listed) on which the Securities may be quoted or listed, as
the case may be, all as determined by the officers executing such Securities,
as evidenced by their execution thereof.


 


Upon their original
issuance, Securities issued as contemplated by the Purchase Agreement to
Qualified Institutional Buyers in reliance on Rule 144A shall be issued in the
form of one or more Global Securities in definitive, fully registered form
without interest coupons and bearing the Restricted Securities Legend.  Such Global Security shall be registered in
the name of DTC, as Depositary, or its nominee and deposited with the Trustee,
as custodian for DTC, for credit by DTC to the respective accounts of
beneficial owners of the Securities represented thereby (or such other accounts
as they may direct).  Such Global
Security, together with its Successor Securities that are Global Securities,
are collectively herein called the “Restricted Global Security”.


 


18

















 


SECTION 2.2                          Form
of Security.


 


[FORM
OF FACE]


 


[THE
FOLLOWING LEGEND SHALL APPEAR ON THE FACE OF EACH RESTRICTED SECURITY:  THIS SECURITY (OR ITS PREDECESSOR) WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND THIS
SECURITY AND THE COMMON STOCK ISSUABLE UPON CONVERSION HEREOF MAY NOT BE
OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR
AN APPLICABLE EXEMPTION THEREFROM.  EACH
PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.


 


THE
HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) THIS
SECURITY AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION HEREOF MAY BE
OFFERED, RESOLD, PLEDGED, OR OTHERWISE TRANSFERRED, ONLY (1) IN THE UNITED
STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE UNITED
STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE
SECURITIES ACT, (III) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), (IV) TO AN
INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a)(1), (2),
(3) OR (7) UNDER THE SECURITIES ACT WHO PURCHASES AT LEAST $100,000 PRINCIPAL
AMOUNT OF SECURITIES, OR (V) PURSUANT TO AN EFFECTIVE REGISTRATION UNDER THE
SECURITIES ACT, IN EACH OF CASES (I) THROUGH (V) IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER
WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS
SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.  IN ANY CASE THE HOLDER HEREOF WILL NOT,
DIRECTLY OR INDIRECTLY, ENGAGE IN ANY HEDGING TRANSACTION WITH REGARD TO THE
SECURITIES EXCEPT AS PERMITTED BY THE SECURITIES ACT.


 


THIS
SECURITY, ANY SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION HEREOF AND ANY
RELATED DOCUMENTATION MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME TO
MODIFY THE RESTRICTIONS ON RESALES AND OTHER TRANSFERS OF THIS SECURITY AND ANY
SUCH SHARES TO REFLECT ANY CHANGE IN APPLICABLE LAW OR REGULATION (OR THE
INTERPRETATION THEREOF) OR IN PRACTICES RELATING TO THE RESALE OR TRANSFER OF
RESTRICTED SECURITIES GENERALLY.  THE
HOLDER OF THIS SECURITY AND SUCH SHARES SHALL BE


 


19

















 


DEEMED
BY THE ACCEPTANCE OF THIS SECURITY AND ANY SUCH SHARES TO HAVE AGREED TO SUCH
AMENDMENT OR SUPPLEMENT.]


 


[THE
FOLLOWING LEGEND SHALL APPEAR ON THE FACE OF EACH GLOBAL SECURITY:


 


THIS
SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITARY OR A NOMINEE OF THE
DEPOSITARY, WHICH MAY BE TREATED BY THE COMPANY, THE TRUSTEE AND ANY AGENT THEREOF
AS OWNER AND HOLDER OF THIS SECURITY FOR ALL PURPOSES.


 


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


 


UNLESS
AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE
REGISTERED FORM IN THE LIMITED CIRCUMSTANCES REFERRED TO IN THE INDENTURE, THIS
GLOBAL SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY
OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE
TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.]


 


20

















 


EPIX MEDICAL, INC.


 


3% CONVERTIBLE SENIOR NOTES
DUE JUNE 15, 2024


 


	
  No.                  

  	
   

  	
  $                    

  



 


CUSIP NO.                     


 


EPIX MEDICAL, INC., a
corporation duly organized and existing under the laws of the State of Delaware
(herein called the “Company,” which term includes any successor Person under
the Indenture referred to on the reverse hereof), for value received, hereby
promises to pay to Cede & Co., or registered assigns, the principal sum of
One Hundred Million United States Dollars (U.S. $100,000,000) [if this Security is a Global Security, then insert
— (which original principal amount may from time to time be increased or
decreased to such other principal amounts (which, taken together with the
original principal amounts of all other Outstanding Securities, shall not
exceed $100,000,000) by adjustments made on the records of the Trustee
hereinafter referred to in accordance with the Indenture) on June 15,
2024, and to pay interest thereon, from June 7, 2004, or from the most
recent Interest Payment Date (as defined below) to which interest has been paid
or duly provided for, semi-annually in arrears on June 15 and
December 15 in each year (each, an “Interest Payment Date”), commencing
December 15, 2004, at the rate of 3% per annum, until the principal hereof
is due, and at the rate of 4% per annum on any overdue principal and, to the
extent permitted by law, on any overdue interest.


 


The interest so payable,
and punctually paid or duly provided for, on any Interest Payment Date will, as
provided in the Indenture, be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest, which shall be the June 1 or
December 1 (whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date. 
Except as otherwise provided in the Indenture, any such interest not so
punctually paid or duly provided for will forthwith cease to be payable to the
Holder on such Regular Record Date and may either be paid to the Person in
whose name this Security (or one or more Predecessor Securities) is registered
at the close of business on a Special Record Date for the payment of such
Defaulted Interest to be fixed by the Company, notice whereof shall be given to
Holders of Securities not less than 10 days prior to the Special Record Date,
or be paid at any time in any other lawful manner not inconsistent with the
requirements of any automated quotation system or securities exchange on which
the Securities may be quoted or listed, and upon such notice as may be required
by such exchange, all as more fully provided in the Indenture.


 


Payments of principal
shall be made upon the surrender of this Security at the option of the Holder
at the Corporate Trust Office of the Trustee, or at such other office or agency
of the Company as may be designated by it for such purpose in the Borough of
Manhattan, The City of New York, in such lawful monies of the United States of
America as at the time of payment shall be legal tender for the payment of
public and private debts, or at such other offices or agencies as the Company
may designate, by United States Dollar check drawn on, or wire transfer to, a
United States Dollar account (such a wire transfer to be made only to a Holder
of an aggregate principal amount of Securities in excess of U.S. $2,000,000 and
only if such Holder shall have furnished wire instructions in writing to the
Trustee no later than 15 days prior to the relevant


 


21

















 


payment
date).  Payments to the Depositary will
be made by wire transfer of immediately available funds to the account of the
Depositary or its nominee.


 


Payment of interest on
this Security may be made by United States Dollar check mailed to the address
of the Person entitled thereto as such address shall appear in the Security
Register, or, upon written application by the Holder to the Security Registrar
setting forth wire instructions not later than the relevant Record Date, by
transfer to a United States Dollar account (such a wire transfer to be made
only to a Holder of an aggregate principal amount of Securities in excess of
U.S. $2,000,000 and only if such Holder shall have furnished wire instructions
in writing to the Trustee no later than 15 days prior to the relevant payment
date).  Payments to the Depositary will
be made by wire transfer of immediately available funds to the account of the
Depositary or its nominee.


 


Except as specifically
provided herein and in the Indenture, the Company shall not be required to make
any payment with respect to any tax, assessment or other governmental charge
imposed by any government or any political subdivision or taxing authority
thereof or therein.


 


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


 


Unless the certificate of
authentication hereon has been executed by the Trustee referred to on the
reverse hereof or an Authenticating Agent by the manual signature of one of
their respective authorized signatories, this Security shall not be entitled to
any benefit under the Indenture or be valid or obligatory for any purpose.


 


22

















 


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


 


	
   

  	
  EPIX MEDICAL, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
  Attest:

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  
	
  Title:

  	
   

  
	
   

  	
   

  
	
  TRUSTEE’S CERTIFICATE
  OF AUTHENTICATION

  	
   

  
	
   

  	
   

  
	
  This is one of the
  Securities referred to in the

  within-mentioned Indenture.

  	
   

  
	
   

  	
   

  
	
  Dated:

  	
   

  
	
   

  	
   

  
	
  U.S. BANK NATIONAL
  ASSOCIATION,

  as Trustee

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized
  Signatory

  	
   

  	
   

  
						



 


23

















 


[FORM OF REVERSE]


 


This Security is one of a
duly authorized issue of securities of the Company designated as its “3%
Convertible Senior Notes due June 15, 2024” (herein called the
“Securities”), limited in aggregate principal amount to U.S. $100,000,000,
issued and to be issued under an Indenture, dated as of June 7, 2004
(herein called the “Indenture”), between the Company and U.S. Bank National
Association, as Trustee (herein called the “Trustee,” which term includes any
successor trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Company,
the Trustee and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered.  As provided in the Indenture and subject to
certain limitations therein set forth, Securities are exchangeable for a like
aggregate principal amount of Securities of any authorized denominations as
requested by the Holder surrendering the same upon surrender of the Security or
Securities to be exchanged, at the Corporate Trust Office of the Trustee.  The Trustee upon such surrender by the
Holder will issue the new Securities in the requested denominations.


 


In any case where the due
date for the payment of the principal of, and interest and Additional Interest,
if any, on, any Security or the last day on which a Holder of a Security has a
right to convert his Security shall be, at any Place of Payment or Place of
Conversion as the case may be, a day on which banking institutions at such
Place of Payment or Place of Conversion are authorized or obligated by law or
executive order to close, then payment of principal and interest and Additional
Interest, if any, or delivery for conversion of such Security need not be made
on or by such date at such place but may be made on or by the next succeeding
day at such place which is not a day on which banking institutions are
authorized or obligated by law or executive order to close, with the same force
and effect as if made on the date for such payment or by such last day for
conversion, and no interest or Additional Interest shall accrue on the amount
so payable for the period after such date.


 


No sinking fund is
provided for the Securities.


 


The indebtedness
evidenced by the Securities is, to the extent and in the manner provided in the
Indenture, expressly subordinated and subject in right of payment to the prior
payment in full of all Schering Indebtedness of the Company, whether outstanding
at the date of the Indenture or thereafter incurred, and this Security is
issued subject to the provisions of the Indenture with respect to such
subordination. Each holder of this Security, by accepting the same, agrees to
and shall be bound by such provisions and authorizes the Trustee on its behalf
to take such action as may be necessary or appropriate to effectuate the
subordination so provided and appoints the Trustee his attorney-in-fact for
such purpose.


 


The Securities will rank
pari passu in right of payment to all unsubordinated indebtedness of the
Company (other than the Schering Indebtedness) and senior in right of payment
to all subordinated indebtedness of the Company which by its terms is
subordinate to the Securities.


 


Subject to and in
compliance with the Indenture, the Securities are subject to repurchase by the
Company at the option of the Holder on June 15, of each of 2011, 2014 and
2019, in whole or in part, for cash, at 100% of the principal amount of such
Securities to be repurchased,


 


24

















 


together with
accrued and unpaid interest and Additional Interest, if any, to, but excluding,
the Purchase Date; provided, however,
that installments of interest and Additional Interest, if any, on Securities
with an Interest Payment Date on or prior to such Purchase Date will be payable
to the Holders of such Securities, or one or more Predecessor Securities, of
record at the close of business on the relevant Record Dates.


 


If a Designated Event
occurs at any time prior to the maturity of the Security, the Holder of this
Security, at the Holder’s option, shall have the right, in accordance with the
provisions of the Indenture, to require the Company to repurchase this Security
(or any portion of the principal amount hereof that is at least U.S. $1,000 or
an integral multiple of U.S. $1,000 in excess thereof, provided that the
portion of the principal amount of this Security to be Outstanding after such
repurchase is at least equal to U.S. $1,000), on a repurchase date that is not
less than 30 nor more than 45 Business Days after the date of the Company
Notice of the Designated Event, at a repurchase price equal to 100% of the
principal amount of the Securities to be repurchased plus accrued and unpaid
interest and Additional Interest, if any, to, but excluding, the Repurchase
Date; provided, however, that
installments of interest and Additional Interest, if any, on Securities with an
Interest Payment Date on or prior to such Repurchase Date will be payable to
the Holders of such Securities, or one or more Predecessor Securities, of
record at the close of business on the relevant Record Dates.  If the Designated Event is a Termination of
Trading, the repurchase price shall be paid in cash.  If the Designated Event is a Change in Control, the repurchase
price shall be paid, at the Company’s option, in cash, by issuance and delivery
of shares of Common Stock valued at a discount of 5% from the Market Price of
the Common Stock or in any combination thereof, subject to the terms and
conditions of the Indenture.


 


Subject to and in
compliance with the Indenture, the Securities will be redeemable at the option
of the Company at any time on or after June 15, 2009, in whole or in part,
upon not less than 20 nor more than 60 days’ notice to the Holders prior to the
Redemption Date at the following redemption prices (expressed as a percentage
of the principal amount of Securities to be redeemed) (each a “Redemption
Price”) payable in cash, together with accrued and unpaid interest and
Additional Interest, if any, to, but excluding, the Redemption Date:


 


	
  Date

  	
   

  	
  Redemption
  Price

  	
   

  
	
  June 15,
  2009 to June 14, 2010

  	
   

  	
  100.857

  	
  %

  
	
  June 15,
  2010 to June 14, 2011

  	
   

  	
  100.429

  	
  %

  
	
  June 15,
  2011 and thereafter

  	
   

  	
  100

  	
  %

  



 


provided,
however, that (1) installments of interest and Additional
Interest, if any, on Securities with an Interest Payment Date on or prior to
such Redemption Date will be payable to the Holders of such Securities, or one
or more Predecessor Securities, of record at the close of business on the
relevant Record Dates and (2) the Company may not redeem any Securities if the
Company has failed to pay any interest on the Securities and such failure to
pay is continuing, or if the principal amount of the Securities has been
accelerated.


 


If less than all of the
Securities are to be redeemed, the Trustee will select the Securities to be
redeemed in principal amounts of $1,000 or whole multiples of $1,000 by lot, on
a pro rata basis or otherwise in accordance with the applicable procedures of
the Depositary.  If any


 


25

















 


Securities are to
be redeemed in part only, the Company will issue a new Security or Securities
in principal amount equal to the unredeemed principal portion thereof.


 


In the event of a
redemption of the Securities, the Company will not be required (a) to register
the transfer or exchange of Securities for a period of 15 days immediately
preceding the date notice is given identifying the serial numbers of the Securities
called for such redemption or (b) to register the transfer or exchange of any
Security, or portion thereof, called for redemption.


 


Subject to and upon
compliance with the provisions of the Indenture, the Holder of this Security is
entitled, at its option, to convert any Security that is an integral multiple
of $1,000 principal amount or the entire outstanding principal amount of this
Security into fully paid and nonassessable shares (calculated as to each
conversion to the nearest 1/100th of a share) of Common Stock of the Company at
the Conversion Rate in effect at the time of conversion and subject to the
adjustments described below, as follows:


 


(1)                                  if,
on or prior to June 15, 2019, the Closing Sale Price of the Common Stock
for at least 20 Trading Days in the period of the 30 consecutive Trading Days
ending on the eleventh Trading Day of any fiscal quarter is more than 120% of
the then current Conversion Price of the Securities, then the Holder thereof
will be entitled to convert such Security until and including the eleventh
Trading Day of the immediately following fiscal quarter;


 


(2)                                  if,
on any date after June 15, 2019, the Closing Sale Price of the Common
Stock is more than 120% of the then current Conversion Price of the Securities,
then the Holder thereof will be entitled to convert such Security at all times
thereafter;


 


(3)                                  if
the Company elects to call the Securities for redemption, then the Holder
thereof will be entitled to convert such Security (or the portion of the
Security called for redemption, if less than all) until the close of business
on the Business Day prior to the Redemption Date;


 


(4)                                  if
the Company distributes to all or substantially all holders of Common Stock,
rights, options or warrants entitling them to purchase Common Stock at less
than the Closing Sale Price of the Common Stock on the last Trading Day
preceding the declaration for such distribution, then the Holder thereof will
be entitled to convert such Security in the period described below;


 


(5)                                  if
the Company distributes to all or substantially all holders of Common Stock,
cash, assets or debt securities of the Company or any Capital Stock of any
Subsidiary, which distribution has a per share value as determined by the Board
of Directors exceeding 5% of the Closing Sale Price of the Common Stock on the
last Trading Day preceding the declaration of such distribution, then the
Holder thereof will be entitled to convert such Security in the period
described below; or


 


(6)                                  if
the Company becomes a party to a consolidation, merger or sale of all or
substantially all of the Company’s assets where such consolidation, merger or
sale of all or substantially all of the Company’s assets constitutes a Change
in Control or such an event occurs that would have been a Change in Control but
for the occurrence of one or more of the exceptions to the definition of Change
in Control contained in the proviso immediately following


 


26

















 


Section 13.4(2)(iii) of the Indenture, then the
Holder thereof will be entitled to convert such Security in the period
described below.


 


A Security for which a
Holder has delivered a repurchase notice as described herein may be surrendered
for conversion only if such notice is withdrawn in accordance with the Indenture.


 


In the case of a
distribution contemplated in clauses (4) and (5) above, the Company will notify
Holders at least 20 days prior to the ex-dividend date for such distribution
(the “Distribution Notice”).  Once the
Company has given the Distribution Notice, Holders may surrender their
Securities for conversion at any time until the earlier of the close of
business on the last Business Day preceding the ex-dividend date or the
Company’s announcement that such distribution will not take place, in which
event the conversion request will be deemed withdrawn automatically.  If in the future the Company adopts a Rights
Plan, Holders will not have any conversion right pursuant to clause (4) above
or otherwise, solely as a result of the issuance of Rights pursuant to the
Rights Plan.  Notwithstanding the
foregoing, in the event of a distribution contemplated in clauses (4) and (5)
above, Holders may not convert the Securities if the Holders may participate in
such distribution without converting their Securities.  In the event of a consolidation, merger or
sale of all or substantially all of the Company’s assets as contemplated in
clause (6) above, the Company will notify Holders at least 20 days prior to the
anticipated closing date of such transaction (the “Merger Notice”).  Once the Company has given the Merger
Notice, the Holders may, in the event of such consolidation, merger or sale of
all or substantially all of the Company’s assets, as contemplated in clause (6)
above, surrender Securities for conversion at any time from and after the date
which is 15 days prior to the anticipated effective date of such transaction
until the date which is 15 days after the actual effective date of such
transaction.


 


Furthermore, subject to
the provisions of the Indenture, at any time prior to June 15, 2019, the
Holder of a Security is entitled, at its option, to convert the principal
amount of this Security (or any portion thereof equal to $1,000 or any integral
multiple of $1,000 in excess thereof or the entire outstanding principal amount
of this Security) for the five Business Day period after any five consecutive
Trading Day period in which the average of the Trading Price for the Securities
in such period was less than 98% of the average Conversion Value for the Securities
during such period.


 


The “Trading Price” of
this Security on any date of determination means the average of the secondary
market bid quotations per $1,000 principal amount of this Security obtained by
the Trustee for $2,000,000 principal amount of this Security at approximately
3:30 p.m., New York City time, on such determination date from three
independent nationally recognized securities dealers the Company selects;
provided that if three such bids cannot reasonably be obtained by the Trustee,
but two such bids are obtained, then the average of the two bids shall be used,
and if only one such bid can reasonably be obtained by the Trustee, then one
bid shall be used.  If the Trustee
cannot reasonably obtain at least one bid for $2,000,000 principal amount of
this Security from a nationally recognized securities dealer, then the Trading
Price per $1,000 principal amount of this Security will be deemed to be less
than 98% of the product of the closing sale price of the Common Stock and the
number of shares issuable upon conversion of $1,000 principal amount of this
Security.


 


27

















 


In connection with any
conversion upon satisfaction of the above Trading Price condition, the Trustee
shall have no obligation to determine the Trading Price of this Security unless
the Company has requested such determination; and the Company shall have no
obligation to make such request unless the Holder provides the Company with
reasonable evidence that the Trading Price per $1,000 principal amount of this
Security would be less than 98% of the product of the closing sale price of the
Common Stock and the number of shares of Common Stock issuable upon conversion
of $1,000 principal amount of this Security. 
At such time, the Company shall instruct the Trustee to determine the
Trading Price of this Security beginning on the next trading date and on each
successive trading day until the Trading Price per $1,000 principal amount of
this Security is greater than or equal to 98% of the product of the closing
sale price of the Common Stock and the number of shares issuable upon
conversion of $1,000 principal amount of this Security.


 


A Holder may convert this
Security, subject to the terms and conditions provided above and in the Indenture,
at any time on or before the close of business on the date of Maturity (or in
case the Holder hereof has exercised his right to require the Company to
purchase or repurchase this Security or the Company has called this Security
for redemption or such portion hereof, until the Business Day immediately
preceding, but (unless the Company defaults in making the payment due upon
redemption, purchase or repurchase, as the case may be) not after, the close of
business on the Business Day immediately preceding the Redemption Date,
Purchase Date or Repurchase Date as the case may be) to convert this Security
(or any portion of the principal amount hereof that is an integral multiple of
U.S. $1,000, provided that the unconverted portion of such principal amount is
U.S. $1,000 or any integral multiple of U.S. $1,000 in excess thereof) into
fully paid and nonassessable shares of Common Stock of the Company at an
initial Conversion Rate of 33.5909 shares of Common Stock for each U.S. $1,000
principal amount of Securities (or at the then current adjusted Conversion Rate
if an adjustment has been made as provided in the Indenture) by surrender of
this Security, duly endorsed or assigned to the Company or in blank.


 


In order to convert this
Security, the Holder shall deliver a conversion notice hereon duly executed and
completed, to the Company at the Corporate Trust Office of the Trustee, or at
such other office or agency of the Company, subject to any laws or regulations
applicable thereto and subject to the right of the Company to terminate the
appointment of any Conversion Agent (as defined below) as may be designated by
it for such purpose in the Borough of Manhattan, The City of New York, or at
such other offices or agencies as the Company may designate (each a “Conversion
Agent”).


 


In case such surrender
shall be made during the period from the close of business on any Regular
Record Date next preceding any Interest Payment Date to the opening of business
on such Interest Payment Date, the conversion notice shall be accompanied by
payment in New York Clearing House or other funds acceptable to the Company of
an amount equal to the interest payable on such Interest Payment Date on the
principal amount of this Security being surrendered for conversion, less any
previously due interest payment as of the Conversion Date as to which the
Company is in arrears.  Notwithstanding
the foregoing, if this Security or a portion hereof has been called for
redemption on a Redemption Date, is repurchasable on a Repurchase Date or purchasable
on a Purchase Date occurring, in any such case, during the period from the
close of business on any Regular Record Date next preceding any Interest


 


28

















 


Payment Date to
the opening of business on such succeeding Interest Payment Date, and as a
result, the right to convert this Security would otherwise terminate in such
period if not exercised, and this Security is surrendered for conversion during
such period, then the Holder of this Security on such Regular Record Date will
be entitled to receive the amount of interest accruing hereon from the Interest
Payment Date next preceding the date of such conversion to such succeeding
Interest Payment Date plus any previously due interest as to which the Company
is in arrears and the Holder of this Security who converts this Security or a
portion hereof during such period shall not be required to pay such amount upon
surrender of this Security for conversion.


 


Subject to the provisions
of the immediately preceding paragraph and, in the case of a conversion after
the close of business on the Regular Record Date next preceding any Interest
Payment Date and on or before the close of business on such Interest Payment
Date, to the right of the Holder of this Security (or any Predecessor Security
of record as of such Regular Record Date) to receive the related installment of
interest to the extent and under the circumstances provided in the Indenture,
no cash payment or adjustment is to be made on conversion for interest, if any,
accrued hereon from the Interest Payment Date next preceding the date of
conversion, or for dividends on the Common Stock issued on conversion
hereof.  The Company shall thereafter
deliver to the Holder the fixed number of shares of Common Stock into which
this Security is convertible and such delivery will be deemed to satisfy the
Company’s obligation to pay the principal amount of this Security, provided,
however, that such delivery of shares of Common Stock shall not relieve
the Company of its obligations to pay interest as to which the Company is in
arrears at the time of conversion and such interest shall remain payable in
accordance with the terms of the Indenture. 
No fractions of shares or scrip representing fractions of shares will be
issued on conversion, but instead of any fractional interest (calculated to the
nearest 1/100th of a share) the Company shall pay a cash adjustment as provided
in the Indenture.


 


The Conversion Rate is
subject to adjustment as provided in the Indenture.


 


In addition, the
Indenture provides that in case of certain consolidations or mergers to which
the Company is a party or the conveyance, transfer, sale or lease of all or
substantially all of the property and assets of the Company, the Indenture
shall be amended, without the consent of any Holders of Securities, so that
this Security, if then Outstanding, will be convertible thereafter, during the
period this Security shall be convertible as specified above, only into the
kind and amount of securities, cash and other property receivable upon such
consolidation, merger, conveyance, transfer, sale or lease by a holder of the
number of shares of Common Stock of the Company into which this Security could
have been converted immediately prior to such consolidation, merger,
conveyance, transfer, sale or lease (assuming such holder of Common Stock is
not a Constituent Person or an Affiliate of a Constituent Person, failed to
exercise any rights of election and received per share the kind and amount
received per share by a plurality of Non-electing Shares).


 


No adjustment in the
Conversion Rate will be made until such adjustment would require an increase or
decrease of at least one percent of such rate, provided that, any adjustment
that would otherwise be made will be carried forward and taken into account in
the computation of any subsequent adjustment.


 


29

















 


If this Security is a
Registrable Security (as defined in the Indenture), then the Holder of this
Security [if this security is a global
security, then insert — (including any Person that has a beneficial
interest in this Security)] and the Common Stock of the Company issuable upon
conversion hereof is entitled to the benefits of a Registration Rights
Agreement, dated as of June 7, 2004, between the Company and the Initial
Purchasers (the “Registration Rights Agreement”).


 


Whenever in this Security
there is a reference, in any context, to the payment of the principal of or
interest on, or in respect of, any Security, such mention shall be deemed to
include mention of the payment of Additional Interest payable as described in
the Registration Rights Agreement to the extent that, in such context,
Additional Interest is, was or would be payable in respect of such Security to
the Holder hereof and express mention of the payment of Additional Interest (if
applicable) in any provisions of this Security shall not be construed as
excluding Additional Interest in those provisions of this Security where such
express mention is not made.


 


Whenever in this Security
there is a reference, in any context, to the principal of any Security as of
any time, such reference shall be deemed to include reference to the Repurchase
Price or Redemption Price, as applicable, payable in respect of such Security
to the extent that such Repurchase Price or Redemption Price, as applicable,
is, was or would be so payable at such time, and express mention of the
Repurchase Price or Redemption Price, as applicable, in any provision of this
Security shall not be construed as excluding the Repurchase Price or Redemption
Price, as applicable, so payable in those provisions of this Security when such
express mention is not made.


 


[If this Security is a
Registrable Security and the Holder of this Security [if this security is a global security, then insert
— (including any Person that has a beneficial interest in this Security)]
elects to sell this Security pursuant to the Shelf Registration Statement then,
by its acceptance hereof, such Holder of this Security agrees to be bound by
the terms of the Registration Rights Agreement relating to the Registrable
Securities which are the subject of such election.]


 


[The
following paragraph shall appear in each Global Security:


 


In the event of a deposit
or withdrawal of an interest in this Security, including an exchange, transfer,
redemption, repurchase or conversion of this Security in part only, the
Trustee, as custodian of the Depositary, shall make an adjustment on its
records to reflect such deposit or withdrawal in accordance with the Applicable
Procedures.]


 


[The
following paragraph shall appear in each Security that is not a Global
Security:


 


In the event of
redemption, repurchase or conversion of this Security in part only, a new
Security or Securities for the unredeemed, unrepurchased or unconverted portion
hereof will be issued in the name of the Holder hereof.]


 


If an Event of Default
shall occur and be continuing, the principal of all the Securities, together
with interest to the date of declaration, may be declared due and payable in
the manner and with the effect provided in the Indenture.


 


30

















 


The Indenture permits,
with certain exceptions as therein provided, the amendment thereof and the
modification of the rights and obligations of the Company and the rights of the
Holders of the Securities under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of a majority in principal amount
of the Securities at the time Outstanding.  The Indenture also contains provisions permitting the Holders of
specified percentages in principal amount of the Securities at the time
Outstanding, on behalf of the Holders of all the Securities, to waive compliance
by the Company with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences.  Any such consent or waiver by the Holder of this Security shall
be conclusive and binding upon such Holder and upon all future Holders of this
Security and of any Security issued in exchange therefore or in lieu hereof
whether or not notation of such consent or waiver is made upon this Security or
such other Security.  Certain
modifications or amendments to the Indenture require the consent of the Holders
of each Outstanding Security affected.


 


As provided in and
subject to the provisions of the Indenture, the Holder of this Security shall
not have the right to institute any proceeding with respect to the Indenture or
for the appointment of a receiver or trustee or for any other remedy
thereunder, unless such Holder shall have previously given the Trustee written
notice of a continuing Event of Default, the Holders of not less than 25% in
principal amount of the Outstanding Securities shall have made written request
to the Trustee to institute proceedings in respect of such Event of Default as
Trustee and offered the Trustee reasonable indemnity, and the Trustee shall not
have received from the Holders of a majority in principal amount of the
Securities Outstanding a direction inconsistent with such request, and shall
have failed to institute any such proceeding, for 60 days after receipt of such
notice, request and offer of indemnity. 
The foregoing shall not apply to any suit instituted by the Holder of
this Security for the enforcement of any payment of principal hereof or
interest hereon, on or after the respective due dates expressed herein or for
the enforcement of the right to convert this Security as provided in the
Indenture.


 


No reference herein to
the Indenture and no provision of this Security or of the Indenture shall alter
or impair the obligation of the Company, which is absolute and unconditional,
to pay the principal of and interest on this Security at the times, places and
rate, and in the coin or currency, herein prescribed or to convert this
Security as provided in the Indenture.


 


As provided in the
Indenture and subject to certain limitations therein set forth, the transfer of
this Security is registrable on the Security Register upon surrender of this Security
for registration of transfer at the Corporate Trust Office of the Trustee or at
such other office or agency of the Company as may be designated by it for such
purpose in the Borough of Manhattan, The City of New York (which shall
initially be an office or agency of the Trustee), or at such other offices or
agencies as the Company may designate, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder thereof or his attorney duly
authorized in writing, and thereupon one or more new Securities, of authorized
denominations and for the same aggregate principal amount, will be issued to
the designated transferee or transferees by the Registrar.  No service charge shall be made for any such
registration of transfer or exchange, but the Company may require payment of a
sum sufficient to recover any tax or other governmental charge payable in
connection therewith.


 


31

















 


Prior to due presentation
of this Security for registration of transfer, the Company, the Trustee and any
agent of the Company or the Trustee may treat the Person in whose name such
Security is registered, as the owner thereof for all purposes, whether or not
such Security be overdue, and neither the Company, the Trustee nor any such
agent shall be affected by notice to the contrary.


 


No recourse for the
payment of the principal of or interest on this Security and no recourse under
or upon any obligation, covenant or agreement of the Company in the Indenture
or any indenture supplemental thereto or in any Security, or because of the
creation of any indebtedness represented thereby, shall be had against any
incorporator, stockholder, employee, agent, officer or director or subsidiary,
as such, past, present or future, of the Company or of any successor
corporation, either directly or through the Company or 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 consideration for the issue
hereof, expressly waived and released.


 


THE
INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, THE UNITED STATES OF AMERICA
INCLUDING, WITHOUT LIMITATION, SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK
GENERAL OBLIGATIONS LAW AND NEW YORK CIVIL PRACTICE LAWS AND RULE 327(B).


 


All terms used in this
Security that are defined in the Indenture shall have the meanings assigned to
them in the Indenture.


 


32

















 


ABBREVIATIONS


 


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


 


	
  TEN COM

  	
   

  	
  as tenant in common

  	
   

  	
  UNIF
  GIFT MIN ACT

  	
   

  	
   

  	
  Custodian

  	
   

  
	
  TEN ENT

  	
   

  	
  as tenants by the
  entireties (Cust)

  	
   

  	
   

  	
   

  	
  (Cust)

  	
  (Minor)

  
	
  JT TEN

  	
   

  	
  as joint tenants with
  right of survivorship and not as tenants in common

  	
   

  	
   

  	
   

  	
  under Uniform Gifts to
  Minors Act                  

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  (State)

  
										



 


 


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


 


33

















 


ELECTION OF HOLDER TO
REQUIRE REPURCHASE


 


(1)                                  Pursuant
to Section 13.1 of the Indenture, the undersigned hereby elects to have
this Security repurchased by the Company.


 


(2)                                  The
undersigned hereby directs the Trustee or the Company to pay it or                               
an amount equal to 100% of the principal amount to be repurchased (as set forth
below), plus accrued and unpaid interest to, but excluding, the Repurchase
Date, as provided in the Indenture.


 


If the Designated Event
giving rise to the right of the undersigned to require the Company to
repurchase the Securities is a Change in Control and the Company elects to pay,
in whole or in part, the Repurchase Price by the issuance and delivery of
shares of Common Stock, but such portion of the Repurchase Price shall
ultimately be paid to the undersigned in cash because any of the conditions to
the payment of the repurchase price in shares of Common Stock is not satisfied
prior to the close of business on the Repurchase Date, the undersigned elects:


 


o                                    to
withdraw this repurchase election as to $                          
principal amount of the Securities to which this Designated Event repurchase
election relates (Certificate Numbers:                                     ),
or


 


o                                    to
receive cash in respect of $                          principal amount of the Securities to which
this Designated Event repurchase election relates.


 


	
  Dated:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Signature(s)

  	
   

  
	
   

  	
   

  
	
  Signature(s) must be
  guaranteed by an Eligible Guarantor Institution with membership in an
  approved signature guarantee program pursuant to Rule 17Ad-15 under the
  Securities Exchange Act of 1934, as amended.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Signature Guaranteed

  	
   

  
	
   

  	
   

  
	
  Principal amount to be
  repurchased (at least U.S. $1,000 or an integral multiple of U.S. $1,000 in
  excess thereof or the entire outstanding principal amount of this
  Security):                  

  	
   

  
	
   

  	
   

  
	
  Remaining principal
  amount following such repurchase (not less than U.S. $1,000):                   

  	
   

  



 


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.


 


34

















 


SECTION 2.3                          Form
of Certificate of Authentication.


 


The Trustee’s certificate
of authentication shall be in substantially the following form:


 


This is one of the
Securities referred to in the within-mentioned Indenture.  


 


	
  Dated:

  	
   

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  
	
   

  	
  as Trustee

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized Signatory

  	
   

  
							



 


SECTION 2.4                          Form
of Conversion Notice.


 


A Holder’s conversion
notice shall be substantially in the following form:


 


CONVERSION NOTICE


 


The undersigned Holder of
this Security hereby exercises the option to convert this Security, or any
portion of the principal amount hereof (which is U.S. $1,000 or an integral
multiple of U.S. $1,000 in excess thereof or the entire outstanding principal
amount of this Security, provided that the unconverted portion of such
principal amount is U.S. $1,000 or any integral multiple of U.S. $1,000 in excess
thereof) below designated, into shares of Common Stock in accordance with the
terms of the Indenture referred to in this Security, and directs that such
shares, together with a check in payment for any fractional share and any
Securities representing any unconverted principal amount hereof, be delivered
to and be registered in the name of the undersigned unless a different name has
been indicated below.  If shares of
Common Stock or Securities are to be registered in the name of a Person other
than the undersigned, (a) the undersigned will pay all transfer taxes payable
with respect thereto and (b) signature(s) must be guaranteed by an Eligible
Guarantor Institution with membership in an approved signature guarantee
program pursuant to Rule 17Ad-15 under the Securities Exchange Act of 1934, as
amended.  Any amount required to be paid
by the undersigned on account of interest accompanies this Security.


 


	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
  Signature(s)

  



 


35

















 


	
  If shares or Securities
  are to be registered in the name of a Person other than the Holder, please
  print such Person’s name and address:

  	
   

  
	
   

  	
   

  
	
  (Name)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  (Address)

  	
   

  
	
   

  	
   

  
	
  Social Security or
  other Identification Number, if any

  	
   

  
	
   

  	
   

  
	
  Signature Guaranteed

  	
   

  



 


 


If only a portion of the
Securities is to be converted, please indicate:


 


1.                                       Principal
amount to be converted: U.S. $          


 


2.                                       Principal
amount and denomination of Securities representing unconverted principal amount
to be issued:


 


	
  Amount: U.S. $        

  	
  Denominations:
  U.S. $        

  



 


(U.S. $1,000 or any
integral multiple of U.S. $1,000 in excess thereof or the entire outstanding
principal amount of this Security, provided that the unconverted portion of
such principal amount is U.S. $1,000 or any integral multiple of U.S. $1,000 in
excess thereof)


 


36

















 


SECTION 2.5                          Form
of Assignment.


 


A Holder’s assignment
notice shall be substantially in the following form:


 


ASSIGNMENT


 


For value received                  hereby
sell(s), assign(s) and transfer(s) unto                    
(Please insert social security or other identifying number of assignee) the
within Security, and hereby irrevocably constitutes and appoints                  as
attorney to transfer the said Security on the books of the Company, with full
power of substitution in the premises.  


 


	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
  Signature(s)

  
	
   

  	
   

  
	
   

  	
  Signature(s) must be
  guaranteed by an Eligible Guarantor Institution with membership in an
  approved signature guarantee program pursuant to Rule 17Ad – 15 under the
  Securities Exchange Act of 1934, as amended.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature Guaranteed

  



 


37

















 


ARTICLE III


 


THE SECURITIES


 


SECTION 3.1                          Title
and Terms.


 


The aggregate principal
amount of Securities which may be authenticated and delivered under this
Indenture is limited to U.S. $100,000,000, except for Securities authenticated
and delivered pursuant to Sections 3.4, 3.5, 3.6, 8.5, 12.2, 13.3(6) or 13.6 in
exchange for, or in lieu of, other Securities previously authenticated and
delivered under this Indenture.


 


The Securities shall be
known and designated as the “3% Convertible Senior Notes due June 15,
2024” of the Company.  Their Stated
Maturity shall be June 15, 2024 and they shall bear interest on their principal
amount from June 7, 2004, payable semi-annually in arrears on June 15
and December 15 in each year, commencing December 15, 2004, at the
rate of 3% per annum until the principal thereof is due and at the rate of 4%
per annum on any overdue principal and, to the extent permitted by law, on any
overdue interest; provided, however,
that payments shall only be made on a Business Day as provided in
Section 1.12.


 


The principal of and
interest on the Securities shall be payable as provided in the form of Securities
set forth in Section 2.2, and the Repurchase Price shall be payable at
such places as are identified in the Company Notice given pursuant to
Section 13.3 (any city in which any Paying Agent is located being herein
called a “Place of Payment”).


 


The Registrable
Securities are entitled to the benefits of a Registration Rights Agreement as
provided in Section 10.11 and in the form of Security set forth in
Section 2.2.  Holders of the
Securities are entitled to the payment of Additional Interest as provided by
Section 10.11 and in the form of security set forth in Section 2.2.


 


The Securities are
redeemable at the option of the Company at any time on or after June 15,
2009, in whole or in part, subject to the conditions and as otherwise provided
in Article XI and in the form of Security set forth in Section 2.2.


 


The Securities shall be
convertible as provided in Article XII (any city in which any Conversion
Agent is located being herein called a “Place of Conversion”).


 


The Securities shall be
subject to repurchase by the Company at the option of the Holders on
June 15, of each of 2011, 2014 and 2019, as provided in Article XIII.


 


SECTION 3.2                          Denominations.


 


The Securities shall be
issuable only in registered form, without coupons, in denominations of U.S.
$1,000 and integral multiples of U.S. $1,000 in excess thereof.


 


SECTION 3.3  Execution,
Authentication, Delivery and Dating.


 


The Securities shall be
executed on behalf of the Company by its Chairman of the Board, its Vice
Chairman of the Board, its Chief Executive Officer, its President, its Chief
Financial


 


38

















 


Officer, one of
its Executive Vice Presidents, one of its Senior Vice Presidents or one of its
Vice Presidents, and attested by its Chief Financial Officer, Secretary or one
of its Assistant Secretaries.  Any such
signature may be manual or facsimile.


 


Securities bearing the
manual or facsimile signature of individuals who were the proper officers of
the Company at the time of execution shall bind the Company, notwithstanding
that such individuals or any of them have ceased to hold such offices prior to
the authentication and delivery of such Securities or did not hold such offices
at the date of such Securities.


 


At any time and from time
to time after the execution and delivery of this Indenture, the Company may
deliver Securities executed by the Company to the Trustee or to its order for
authentication, together with a Company Order for the authentication and
delivery of such Securities, and the Trustee in accordance with such Company
Order shall authenticate and make available for delivery such Securities as
provided in this Indenture.


 


Each Security shall be
dated the date of its authentication.


 


No Security shall be
entitled to any benefit under this Indenture or be valid or obligatory for any
purpose unless there appears on such Security a certificate of authentication
substantially in the form provided for herein executed by the Trustee by manual
signature of an authorized signatory, and such certificate upon any Security
shall be conclusive evidence, and the only evidence, that such Security has
been duly authenticated and delivered hereunder.


 


SECTION 3.4                          Global
Securities; Non-Global Securities; Book-Entry Provisions.


 


(1)                                  Global
Securities.


 


(i)                                     Each
Global Security authenticated under this Indenture shall be registered in the
name of the Depositary designated by the Company for such Global Security or a
nominee thereof and delivered to such Depositary or a nominee thereof or
custodian therefor, and each such Global Security shall constitute a single
Security for all purposes of this Indenture.


 


(ii)                                  Except
for exchanges of Global Securities for definitive, Non-global Securities at the
sole discretion of the Company, no Global Security may be exchanged in whole or
in part for Securities registered, and no transfer of a Global Security in
whole or in part may be registered, in the name of any Person other than the
Depositary (or a successor to the Depositary) for such Global Security or a nominee
(or a successor to a nominee) thereof unless (A) such Depositary (i) has
notified the Company that it is unwilling or unable to continue as Depositary
for such Global Security or (ii) has ceased to be a clearing agency registered
as such under the Exchange Act and a successor depositary has not been
appointed within 90 days, or (B) the Company, at its option elects to cause the
issuance of the Securities in certificated form.  In such event, the Company will execute, and the Trustee, upon
receipt of an Officers’ Certificate directing the authentication and delivery
of Securities, will authenticate and deliver, Securities, in any authorized
denominations in an aggregate principal amount equal to the principal amount of
such Global Security in exchange for such Global Security.


 


(iii)                               If
any Global Security is to be exchanged for other Securities or canceled in
whole, it shall be surrendered by or on behalf of the Depositary or its nominee
to the Trustee,


 


39

















 


as Security Registrar, for exchange or cancellation,
as provided in this Article III. 
If any Global Security is to be exchanged for other Securities or
canceled in part, or if another Security is to be exchanged in whole or in part
for a beneficial interest in any Global Security, in each case, as provided in
Section 3.5, then either (A) such Global Security shall be so surrendered
for exchange or cancellation, as provided in this Article III, or (B) the
principal amount thereof shall be reduced or increased by an amount equal to
the portion thereof to be so exchanged or canceled, or equal to the principal
amount of such other Security to be so exchanged for a beneficial interest
therein, as the case may be, by means of an appropriate adjustment made on the
records of the Trustee, as Security Registrar, whereupon the Trustee, in
accordance with the Applicable Procedures, shall instruct the Depositary or its
authorized representative to make a corresponding adjustment to its records.  Upon any such surrender or adjustment of a
Global Security, the Trustee shall, subject to Section 3.5(3) and as
otherwise provided in this Article III, authenticate and deliver any
Securities issuable in exchange for such Global Security (or any portion
thereof) to or upon the order of, and registered in such names as may be
directed by, the Depositary or its authorized representative.  Upon the request of the Trustee in
connection with the occurrence of any of the events specified in the preceding
paragraph, the Company shall promptly make available to the Trustee a
reasonable supply of Securities that are not in the form of Global
Securities.  The Trustee shall be
entitled to rely upon any order, direction or request of the Depositary or its
authorized representative which is given or made pursuant to this
Article III if such order, direction or request is given or made in
accordance with the Applicable Procedures.


 


(iv)                              Every
Security authenticated and delivered upon registration of transfer of, or in
exchange for or in lieu of, a Global Security or any portion thereof, whether
pursuant to this Article III or otherwise, shall be authenticated and
delivered in the form of, and shall be, a registered Global Security, unless
such Security is registered in the name of a Person other than the Depositary
for such Global Security or a nominee thereof, in which case such Security
shall be authenticated and delivered in definitive, fully registered form,
without interest coupons.


 


(v)                                 The
Depositary or its nominee, as registered owner of a Global Security, shall be
the Holder of such Global Security for all purposes under the Indenture and the
Securities, and owners of beneficial interests in a Global Security shall hold
such interests pursuant to the Applicable Procedures.  Accordingly, any such owner’s beneficial interest in a Global
Security will be shown only on, and the transfer of such interest shall be
effected only through, records maintained by the Depositary or its nominee or
its Agent Members and such owners of beneficial interests in a Global Security
will not be considered the owners or holders thereof.


 


(2)                                  Non-global
Securities.  Securities issued upon the
events described in Section 3.4(1)(ii) shall be in definitive, fully
registered form, without interest coupons, and shall bear the Restricted
Securities Legend if and as required by this Indenture.


 


SECTION 3.5                          Registration;
Registration of Transfer and Exchange; Restrictions on Transfer.


 


(1)                                  The
Company shall cause to be kept at the Corporate Trust Office of the Trustee a
register (the register maintained in such office referred to as the “Security
Register”) in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the


 


40

















 


registration of Securities and of transfers of
Securities.  The Trustee is hereby
appointed “Security Registrar” for the purpose of registering Securities and
transfers and exchanges of Securities as herein provided.


 


Upon surrender for
registration of transfer of any Security at an office or agency of the Company
designated pursuant to Section 10.2 for such purpose, the Company shall
execute, and the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Securities of any
authorized denominations and of a like aggregate principal amount and bearing
such restrictive legends as may be required by this Indenture.


 


At the option of the
Holder, and subject to the other provisions of this Section 3.5,
Securities may be exchanged for other Securities of any authorized denomination
and of a like aggregate principal amount, upon surrender of the Securities to
be exchanged at any such office or agency. 
Whenever any Securities are so surrendered for exchange, and subject to
the other provisions of this Section 3.5, the Company shall execute, and
the Trustee shall authenticate and deliver, the Securities that the Holder
making the exchange is entitled to receive. 
Every Security presented or surrendered for registration of transfer or
for exchange shall (if so required by the Company or the Security Registrar) be
duly endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company, the Trustee and the Security Registrar duly
executed, by the Holder thereof or his attorney duly authorized in writing.


 


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


 


No service charge shall
be made to a Holder for any registration of transfer or exchange of Securities
except as provided in Section 3.6, but the Company may require payment of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any registration of transfer or exchange of
Securities, other than exchanges pursuant to Sections 3.4, 8.5, 12.2, 13.3(6)
or 13.6 (other than where the shares of Common Stock are to be issued or
delivered in a name other than that of the Holder of the Security) not
involving any transfer and other than any stamp and other duties, if any, which
may be imposed in connection with any such transfer or exchange by the United
States or any political subdivision thereof or therein, which shall be paid by
the Company.


 


In the event of a
redemption of the Securities, neither the Company nor the Securities Registrar
will be required (a) to register the transfer of or exchange Securities for a
period of 15 days immediately preceding the date notice is given identifying
the serial numbers of the Securities called for such redemption or (b) to
register the transfer of or exchange any Security, or portion thereof, called
for redemption.


 


(2)                                  Certain
Transfers and Exchanges. 
Notwithstanding any other provision of this Indenture or the Securities,
transfers and exchanges of Securities and beneficial interests in a Global
Security of the kinds specified in this Section 3.5(2) shall be made only
in accordance with this Section 3.5(2).


 


41

















 


(i)                                     Restricted
Global Security to Restricted Non-Global Security.  In the event that Non-Global Securities are
to be issued pursuant to Section 3.4(1)(ii) in connection with any
transfer of Securities, such transfer may be effected only in accordance with
the provisions of this clause (2)(i) and subject to the Applicable
Procedures.  Upon receipt by the
Trustee, as Security Registrar, of (A) a Company Order from the Company
directing the Trustee, as Security Registrar, to (x) authenticate and deliver
one or more Securities of the same aggregate principal amount as the beneficial
interest in the Restricted Global Security to be transferred, such instructions
to contain the name or names of the designated transferee or transferees, the
authorized denomination or denominations of the Securities to be so issued and
appropriate delivery instructions and (y) decrease the beneficial interest of a
specified Agent Member’s account in a Restricted Global Security by a specified
principal amount not greater than the principal amount of such Restricted
Global Security, and (B) such other certifications, legal opinions or other
information as the Company may reasonably require to confirm that such transfer
is being made pursuant to an exemption from, or in a transaction not subject
to, the registration requirements of the Securities Act, then the Trustee, as
Security Registrar, shall decrease the principal amount of the Restricted
Global Security by the specified amount and authenticate and deliver Securities
in accordance with such instructions from the Company as provided in
Section 3.4(1)(iii).


 


(ii)                                  Restricted
Non-Global Security to Restricted Global Security.  If the Holder of a Restricted Security
(other than a Global Security) wishes at any time to transfer all or any
portion of such Restricted Security to a Person who wishes to take delivery
thereof in the form of a beneficial interest in the Restricted Global Security,
such transfer may be effected only in accordance with the provisions of this
clause (2)(ii) and subject to the Applicable Procedures.  Upon receipt by the Trustee, as Security
Registrar, of such Restricted Security as provided in Section 3.5(1) and
instructions from the Company directing that a beneficial interest in the
Restricted Global Security in a specified principal amount not greater than the
principal amount of such Security be credited to a specified Agent Member’s account,
then the Trustee, as Security Registrar, shall cancel such Restricted Security
(and issue a new Restricted Security in respect of any untransferred portion
thereof) as provided in Section 3.5(1) and increase the principal amount
of the Restricted Global Security by the specified principal amount as provided
in Section 3.4(1)(iii).


 


(iii)                               Exchanges
Between Global Security and Non-Global Security.  A beneficial interest in a Global Security may be exchanged for a
Security that is not a Global Security only as provided in Section 3.4 or
only if such exchange occurs in connection with a transfer effected in
accordance with clause 2(i) above, provided that, if such interest is a
beneficial interest in the Restricted Global Security, then such interest shall
be exchanged for a Restricted Security (subject in each case to
Section 3.5(3)).  A Security that
is not a Global Security may be exchanged for a beneficial interest in a Global
Security only if such exchange occurs in connection with a transfer effected in
accordance with clause (2)(ii) above.


 


(3)                                  Securities
Act Legends.  All Securities issued
pursuant to this Indenture, and all Successor Securities, shall bear the
Restricted Securities Legend and shall be subject to the restrictions on
transfer specified therein, subject to the following:


 


42

















 


(i)                                     subject
to the following clauses of this Section 3.5(3), a Security or any portion
thereof that is exchanged, upon transfer or otherwise, for a Global Security or
any portion thereof shall bear the Restricted Securities Legend borne by such
Global Security for which the Security was exchanged;


 


(ii)                                  subject
to the following clauses of this Section 3.5(3), a new Security that is
not a Global Security and is issued in exchange for another Security (including
a Global Security) or any portion thereof, upon transfer or otherwise, shall
bear the Restricted Securities Legend borne by the Security for which the new
Security was exchanged;


 


(iii)                               any
Securities that are sold or otherwise disposed of pursuant to an effective
registration statement under the Securities Act (including the Shelf
Registration Statement), together with their Successor Securities shall not
bear a Restricted Securities Legend; the Company shall inform the Trustee in
writing of the effective date of any such registration statement registering
the Securities under the Securities Act and shall notify the Trustee, in
writing, at any time when prospectuses must be delivered with respect to
Securities to be sold pursuant to such registration statement.  The Trustee shall not be liable for any
action taken or omitted to be taken by it in good faith in accordance with the
aforementioned registration statement;


 


(iv)                              at
any time after the Securities may be freely transferred without registration
under the Securities Act or without being subject to transfer restrictions
pursuant to the Securities Act, a new Security that does not bear a Restricted
Securities Legend may be issued in exchange for or in lieu of a Security (other
than a Global Security) or any portion thereof that bears such a legend if the
Trustee has received an Unrestricted Securities Certificate duly executed by
the Holder of such Security bearing a Restricted Securities Legend or his
attorney duly authorized in writing, and after such date and receipt of such
certificate, the Trustee shall authenticate and deliver such new Security in
exchange for or in lieu of such other Security as provided in this
Article III;


 


(v)                                 a
new Security that does not bear a Restricted Securities Legend may be issued in
exchange for or in lieu of a Security or any portion thereof that bears such a
legend if, in the Company’s judgment, placing such a legend upon such new
Security is not necessary to ensure compliance with the registration
requirements of the Securities Act, and the Trustee, at the direction of the
Company, shall authenticate and deliver such a new Security as provided in this
Article III; and


 


(vi)                              notwithstanding
the foregoing provisions of this Section 3.5(3), a Successor Security of a
Security that does not bear a Restricted Securities Legend shall not bear such
legend unless the Company has reasonable cause to believe that such Successor
Security is a “restricted security” within the meaning of Rule 144, in which
case the Trustee, at the written direction of the Company, shall authenticate
and deliver a new Security bearing a Restricted Securities Legend in exchange
for such Successor Security as provided in this Article III.


 


(4)                                  Any
stock certificate representing shares of Common Stock issued upon conversion of
the Securities shall bear the Restricted Securities Legend borne by such
Securities, to the extent required by this Indenture, unless such shares of
Common Stock have been sold


 


43

















 


pursuant to a registration statement that has been
declared effective under the Securities Act (and that continues to be effective
at the time of such transfer) or sold pursuant to Rule 144(k) of the Securities
Act, or unless otherwise agreed by the Company in writing with written notice
thereof to the transfer agent for the Common Stock.  With respect to the transfer of shares of Common Stock issued
upon conversion of the Securities that are restricted hereunder, any deliveries
of certificates, legal opinions or other instruments that would be required to
be made to the Security Registrar in the case of a transfer of Securities, as
described above, shall instead be made to the transfer agent for the Common
Stock.


 


(5)                                  Neither
the Trustee, the Paying Agent nor any of their agents shall (i) have any duty
to monitor compliance with or with respect to any Federal or state or other
securities or tax laws or (ii) have any duty to obtain documentation on any
transfers or exchanges other than as specifically required hereunder.


 


SECTION 3.6                          Mutilated,
Destroyed, Lost or Stolen Securities.


 


If any mutilated Security
is surrendered to the Trustee, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a new Security of like tenor and
principal amount and bearing a number not contemporaneously outstanding.


 


If there be delivered to
the Company and to the Trustee:


 


(1)                                  evidence
to their satisfaction of the destruction, loss or theft of any Security, and


 


(2)                                  such
security or indemnity as may be satisfactory to the Company and the Trustee to
save each of them and any agent of either of them harmless, then, in the
absence of actual notice to the Company or the Trustee that such Security has
been acquired by a bona fide purchaser, the Company shall execute and the
Trustee shall authenticate and deliver, in lieu of any such destroyed, lost or
stolen Security, a new Security of like tenor and principal amount and 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, the Company in its discretion, but subject to any conversion
rights, may, instead of issuing a new Security, pay such Security, upon
satisfaction of the conditions set forth in the preceding paragraph.


 


Upon the issuance of any
new Security under this Section 3.6, 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 (other than any stamp and other duties, if any,
which may be imposed in connection therewith by the United States or any
political subdivision thereof or therein, which shall be paid by the Company)
and any other expenses (including the fees and expenses of the Trustee)
connected therewith.


 


Every new Security issued
pursuant to this Section 3.6 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 such new Security
shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Securities duly issued hereunder.


 


44

















 


The provisions of this
Section 3.6 are exclusive and shall preclude (to the extent lawful) all
other rights and remedies of any Holder with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.


 


SECTION 3.7                          Payment
of Interest; Interest Rights Preserved.


 


Subject to the last
paragraph of this Section 3.7, interest or Additional Interest on any
Security that is payable, and is punctually paid or duly provided for, on any
Interest Payment Date shall be paid to the Person in whose name that Security
(or one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest.


 


Any interest or
Additional Interest on any Security that is payable, but is not punctually paid
or duly provided for, on any Interest Payment Date (herein called “Defaulted
Interest”) shall forthwith cease to be payable to the Holder on the relevant
Regular Record Date by virtue of having been such Holder, and such Defaulted
Interest may be paid by the Company, at its election in each case, as provided
in clause (1) or (2) below:


 


(1)                                  The
Company may elect to make payment of any Defaulted Interest to the Persons in
whose names the Securities (or their respective Predecessor Securities) are
registered at the close of business on a “Special Record Date” for the payment
of such Defaulted Interest, which shall be fixed in the following manner.  The Company shall notify the Trustee in
writing of the amount of Defaulted Interest proposed to be paid on each
Security, the date of the proposed payment and the Special Record Date, and at
the same time the Company shall deposit with the Trustee an amount of money
equal to the aggregate amount proposed to be paid in respect of such Defaulted
Interest or shall make arrangements satisfactory to the Trustee for such
deposit prior to the date of the proposed payment, such money when deposited to
be held in trust for the benefit of the Persons entitled to such Defaulted
Interest as in this clause provided. 
The Special Record Date for the payment of such Defaulted Interest shall
be not more than 15 days and not less than 10 days prior to the date of the
proposed payment and not less than 10 days after the receipt by the Trustee of
the notice of the proposed payment.  The
Trustee, in the name and at the expense of the Company, shall cause notice of
the proposed payment of such Defaulted Interest and the Special Record Date therefor
to be mailed, first-class postage prepaid, to each Holder at such Holder’s
address as it appears in the Security Register, not less than 10 days prior to
such Special Record Date.  Notice of the
proposed payment of such Defaulted Interest and the Special Record Date
therefor having been so mailed, such Defaulted Interest shall be paid to the
Persons in whose names the Securities (or their respective Predecessor
Securities) are registered at the close of business on such Special Record Date
and shall no longer be payable pursuant to the following clause (2).


 


(2)                                  The
Company may make payment of any Defaulted Interest in any other lawful manner
not inconsistent with the requirements of any securities exchange on which the
Securities may be listed, and upon such notice as may be required by such
exchange, if, after notice given by the Company to the Trustee of the proposed
payment pursuant to this clause, such manner of payment shall be deemed
practicable by the Trustee.


 


Subject to the provisions
of this Section 3.7 and Section 3.5, each Security delivered under
this Indenture upon registration of transfer of or in exchange for or in lieu
of any other


 


45

















 


Security shall
carry the rights to interest accrued and unpaid, and to accrue, which were carried
by such other Security.


 


Interest on any Security
that is converted in accordance with Section 12.2 during a Record Date
Period shall be payable in accordance with the provisions of Section 12.2.


 


SECTION 3.8                          Persons
Deemed Owners.


 


Prior to due presentment
of a Security for registration of transfer, the Company, the Trustee, any
Paying Agent and any agent of the Company, the Trustee or any Paying Agent may
treat the Person in whose name such Security is registered as the owner of such
Security for the purpose of receiving payment of principal of and interest
(subject to Section 3.7) and Additional Interest, if any on such Security
and for all other purposes whatsoever, whether or not such Security be overdue,
and neither the Company, the Trustee, any Paying Agent nor any agent of the
Company, the Trustee or any Paying Agent shall be affected by notice to the
contrary.


 


SECTION 3.9                          Cancellation.


 


All Securities
surrendered for payment, purchase, repurchase, redemption, registration of
transfer or exchange or conversion shall, if surrendered to any Person other
than the Trustee, be delivered to the Trustee. 
All Securities so delivered to the Trustee shall be canceled promptly by
the Trustee (or its agent).  No
Securities shall be authenticated in lieu of or in exchange for any Securities
canceled as provided in this Section 3.9. 
The Trustee shall dispose of all canceled Securities in accordance with
applicable law and its customary practices in effect from time to time.


 


SECTION 3.10                    Computation
of Interest.


 


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


 


SECTION 3.11                    CUSIP
Numbers.


 


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


 


SECTION 3.12                    Ranking.


 


The indebtedness of the
Company arising under or in connection with this Indenture and every
outstanding Security issued under this Indenture from time to time is, to the
extent and in the manner provided in this Indenture, expressly subordinated and
subject in right of payment to the prior payment in full of all Schering
Indebtedness of the Company, whether outstanding at


 


46

















 


the date of this
Indenture or thereafter incurred, and the Securities are being issued subject
to the provisions of Article XVI with respect to such subordination. Other
than the subordination described in the preceding sentence, the indebtedness of
the Company arising under or in connection with this Indenture and every
outstanding Security issued under this Indenture from time to time constitutes
and will constitute a senior unsecured general obligation of the Company,
ranking on parity in right of payment with other existing and future Senior
Indebtedness of the Company (other than the Schering Indebtedness) and ranking
senior in right of payment to any future subordinated Indebtedness of the
Company which by its terms is subordinate to the Securities.


 


SECTION 3.13                    Company
Purchase of Securities.


 


The Company may from time
to time repurchase the Securities in open market purchases or negotiated
transactions without prior notice to Holders.


 


ARTICLE IV


 


SATISFACTION AND
DISCHARGE


 


SECTION 4.1                          Satisfaction
and Discharge of Indenture.


 


This Indenture shall upon
Company Request cease to be of further effect, and the Trustee, at the expense
of the Company, shall execute proper instruments in form and substance
satisfactory to the Trustee acknowledging satisfaction and discharge of this
Indenture, when


 


(1)                                  either


 


(i)                                     all
Securities theretofore authenticated and delivered (other than (A) Securities
which have been destroyed, lost or stolen and that have been replaced or paid
as provided in Section 3.6 and (B) Securities for whose payment money has
theretofore been deposited in trust or segregated and held in trust by the
Company and thereafter repaid to the Company or discharged from such trust as
described in the last paragraph of Section 10.3) have been delivered to
the Trustee for cancellation; or


 


(ii)                                  all
such Securities not theretofore delivered to the Trustee or its agent for
cancellation (other than Securities referred to in clauses (A) and (B) of
clause (1)(i) above)


 


(a)                                  have
become due and payable, or


 


(b)                                 will
have become due and payable at their Stated Maturity within one year, or


 


(c)                                  are
to be called for redemption within one year under arrangements satisfactory to
the Trustee for the giving of notice of redemption by the Trustee in the name
and at the expense of the Company, and the Company, in the case of clause (i)
or (ii) above, has deposited or caused to be deposited with the Trustee funds
(immediately available to the Holders in the case of clause (ii)(a) above) in
trust in an amount in cash sufficient to pay and discharge the entire
indebtedness on such Securities not theretofore delivered to the Trustee for


 


47

















 


cancellation, for
principal and interest and Additional Interest, if any to the date of such
deposit (in the case of Securities which have become due and payable) or to the
Stated Maturity or Redemption Date, as the case may be;


 


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


 


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


 


Notwithstanding the
satisfaction and discharge of this Indenture, any surviving rights of
conversion, or registration of transfer or exchange, or replacement of
Securities expressly provided for herein or in the form of Securities set forth
in Section 2.2, the obligations of the Company to the Trustee under
Section 6.7, the obligations of the Company to any Authenticating Agent
under Section 6.12, the obligation of the Company to pay Additional
Interest, if any, the obligations of the Trustee under Section 4.2 and the
last paragraph of Section 10.3 and the obligations of the Company and the
Trustee under Section 3.5 and Article XII shall survive such
satisfaction and discharge.


 


SECTION 4.2                          Application
of Trust Money.


 


Subject to the provisions
of the last paragraph of Section 10.3, all money deposited with the
Trustee pursuant to Section 4.1 and in accordance with the provisions of
Article XIII shall be held in trust for the sole benefit of the Holders
and such monies shall be applied by the Trustee, in accordance with the
provisions of the Securities and this Indenture, to the payment, either
directly or through any Paying Agent, to the Persons entitled thereto, of the
principal and interest, for whose payment such money has been deposited with
the Trustee.


 


All money deposited with
the Trustee pursuant to Section 4.1 (and held by it or any Paying Agent)
for the payment of Securities subsequently converted shall be returned to the
Company upon Company Request.


 


The Company shall pay and
indemnify the Trustee against any tax, fee or other charge imposed or assessed
against all money deposited with the Trustee pursuant to Section 4.1
(other than income taxes and franchise taxes incurred or payable by the Trustee
and such other taxes, fees or charges incurred or payable by the Trustee that
are not directly the result of the deposit of such money with the Trustee).


 


ARTICLE V


 


REMEDIES


 


SECTION 5.1                          Events
of Default.


 


“Event of Default,”
wherever used herein, means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary


 


48

















 


or be effected by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):


 


(1)                                  default
in the payment of any interest and Additional Interest, if any, upon any
Security when it becomes due and payable, and continuance of such default for a
period of 30 consecutive days; or


 


(2)                                  default
in the payment of the principal on any Security at its Maturity (including any
Redemption Price, Repurchase Price or Purchase Price); or


 


(3)                                  any
indebtedness under any bonds, debentures, notes or other evidences of
indebtedness for money borrowed (or guarantee thereof) by the Company (an
“Instrument”) in an aggregate principal amount in excess of U.S. $10,000,000,
whether such indebtedness now exists or shall hereafter be created, is not paid
when due under any Instrument (either at its stated maturity or upon
acceleration thereof) and such payment default is continuing after any
applicable grace periods, and such indebtedness is not discharged, or such
acceleration is not rescinded or annulled, within a period of 10 days; or


 


(4)                                  default
or breach in the performance of any covenant of the Company in this Indenture
(other than a covenant a default in the performance of which is specifically
dealt with elsewhere in this Section 5.1), and continuance of such default
for a period of 60 consecutive days after there has 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 principal amount of the Outstanding
Securities a written notice specifying such default or breach and requiring it
to be remedied and stating that such notice is a “Notice of Default” hereunder;
or


 


(5)                                  the
entry by a court having jurisdiction in the premises of (A) a decree or order
for relief in respect of the Company or any Significant Subsidiary in an involuntary
case or proceeding under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar law or (B) a decree or order
adjudging the Company or any Significant Subsidiary a bankrupt or insolvent, or
approving as properly filed a petition seeking reorganization, arrangement,
adjustment or composition of or in respect of the Company or any Significant
Subsidiary under any applicable Federal or State law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or any Significant Subsidiary or of any
substantial part of the property of either, or ordering the winding up or
liquidation of the affairs of either of them, and the continuance of any such
decree or order for relief or any such other decree or order unstayed and in
effect for a period of 60 consecutive days; or


 


(6)                                  the
commencement by the Company or any Significant Subsidiary of a voluntary case
or proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to be
adjudicated a bankrupt or insolvent, or the consent by either to the entry of a
decree or order for relief in respect of the Company or such Significant
Subsidiary in an involuntary case or proceeding under any applicable Federal or
State bankruptcy, insolvency, reorganization or other similar law or to the
commencement of any bankruptcy or insolvency case or proceeding against the
Company or any Significant Subsidiary, or the filing by either of a petition or
answer or consent seeking reorganization or similar relief


 


49

















 


under any applicable Federal or State law, or the
consent by either to the filing of such petition or to the appointment of or
taking possession by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Company or any Significant
Subsidiary or of any substantial part of the property of either, or the making
by the Company or any Significant Subsidiary of an assignment for the benefit
of creditors, or the admission by the Company or any Significant Subsidiary in
writing of its inability to pay its debts generally as they become due, or the
taking of corporate action by the Company or any Significant Subsidiary in
furtherance of any such action.


 


SECTION 5.2                          Acceleration
of Maturity; Rescission and Annulment.


 


If an Event of Default
(other than an Event of Default specified in Section 5.1(5) or 5.1(6) with
respect to the Company) occurs and is continuing, then in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities may declare the principal of, and any accrued interest
on, all the Securities to be due and payable immediately, by a notice in
writing to the Company (and to the Trustee if given by the Holders), and upon
any such declaration such principal and accrued interest thereon shall become
immediately due and payable.  If an
Event of Default specified in Section 5.1(5) or 5.1(6) with respect to the
Company occurs, the principal of and accrued interest on all the Securities
shall, ipso facto, become
immediately due and payable without any declaration or other Act of the Holders
or any act on the part of the Trustee.


 


At any time after such
declaration of acceleration has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in
this Article V provided, the Holders of a majority in principal amount of
the Outstanding Securities, by written notice to the Company and the Trustee,
may, on behalf of all Holders, rescind and annul such declaration and its
consequences if:


 


(1)                                  the
Company has paid or deposited with the Trustee a sum sufficient to pay


 


(i)                                     all
overdue interest, including overdue Additional Interest, if any, on all
Securities;


 


(ii)                                  the
principal of any Securities that have become due other than by such declaration
of acceleration and any accrued and unpaid interest thereon at the rate borne
by the Securities;


 


(iii)                               to
the extent permitted by applicable law, interest upon overdue interest at a
rate of 4% per annum; and


 


(iv)                              all
sums paid or advanced by the Trustee hereunder and the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel;


 


(2)                                  all
Events of Default, other than the nonpayment of the principal of and interest
on Securities which have become due solely by such declaration of acceleration,
have been cured or waived as provided in Section 5.13; and


 


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(3)                                  such
rescission and annulment would not conflict with any judgment or decree issued
in appropriate judicial proceedings regarding the payment by the Trustee to the
Holders of the amounts referred to in 5.2(1).


 


No rescission or
annulment referred to above shall affect any subsequent default or impair any
right consequent thereon.


 


SECTION 5.3                          Collection
of Indebtedness and Suits for Enforcement by Trustee.


 


The Company covenants
that if:


 


(1)                                  default
is made in the payment of interest and Additional Interest, if any, on any
Security when it becomes due and payable and such default continues for a
period of 30 consecutive days, or


 


(2)                                  default
is made in the payment of the principal of any Security at the Maturity
thereof,


 


the Company will, upon
demand of the Trustee pay to it, for the benefit of the Holders of such
Securities, the whole amount then due and payable on such Securities for
principal and interest (including any Additional Interest), interest on any
overdue principal, and to the extent permitted by applicable law, interest upon
overdue interest and Additional Interest, if any, at a rate of 4% per annum and
such further amount as shall be sufficient to cover the reasonable costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.


 


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


 


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


 


SECTION 5.4                          Trustee
May File Proofs of Claim.


 


In case of the pendency
of any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial proceeding relative to
the Company or any other obligor upon the Securities or the property of the
Company or of such other obligor or the creditors of either, the Trustee
(irrespective of whether the principal or interest of the Securities shall then
be due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Trustee shall have made any demand on the Company


 


51

















 


for the payment of
overdue principal or interest) shall be entitled and empowered, by intervention
in such proceeding or otherwise,


 


(1)                                  to
file a proof of claim for the whole amount of principal and interest owing and
unpaid in respect of the Securities and take such other actions, including
participating as a member, voting or otherwise, of any official committee of
creditors appointed in such matter, and to file such other papers or documents,
in each of the foregoing cases, as may be necessary or advisable in order to
have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel) and of the Holders of Securities allowed in such judicial
proceeding, and


 


(2)                                  to
collect and receive any moneys or other property payable or deliverable on any
such claim and to distribute the same; and any custodian, receiver, assignee,
trustee, liquidator, sequestrator or other similar official in any such
judicial proceeding is hereby authorized by each Holder of Securities 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 of Securities 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 6.7.


 


Nothing herein contained
shall be deemed to authorize the Trustee to authorize or consent to or accept
or adopt on behalf of any Holder of a Security 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 of a Security in any such proceeding; provided, however, that the Trustee may,
on behalf of such Holders, vote for the election of a trustee in bankruptcy or
similar official.


 


SECTION 5.5                          Trustee
May Enforce Claims Without Possession of Securities.


 


All rights of action and
claims under this Indenture or the Securities may be prosecuted and enforced by
the Trustee without the possession of any of the Securities or the production
thereof in any proceeding relating thereto, and any such proceeding instituted
by the Trustee shall be brought in its own name as trustee of an express trust,
and any recovery of judgment shall, after provision for the payment of the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, be for the ratable benefit of the Holders of the
Securities in respect of which judgment has been recovered.


 


SECTION 5.6                          Application
of Money Collected.


 


Any money or property
collected by the Trustee pursuant to this Article V shall be applied in
the following order, at the date or dates fixed by the Trustee and, in case of
the distribution of such money on account of principal or interest, upon
presentation of the Securities and the notation thereon of the payment if only
partially paid and upon surrender thereof if fully paid:


 


FIRST:  To the payment of all amounts due the
Trustee under Section 6.7;


 


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SECOND:  To the payment of the amounts then due and
unpaid for principal of, Redemption Price for or interest and Additional
Interest, if any, on the Securities in respect of which or for the benefit of
which such money or property has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such
Securities for principal and interest and Additional Interest, if any,
respectively; and


 


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


 


SECTION 5.7                          Limitation
on Suits.


 


No Holder of any Security
shall have any right to institute any proceeding, judicial or otherwise, with
respect to this Indenture, or for the appointment of a receiver or trustee, or
for any other remedy hereunder, unless:


 


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


 


(2)                                  the
Holders of not less than 25% in principal amount of the Outstanding Securities
shall have made written request to the Trustee to institute proceedings in
respect of such Event of Default in its own name as Trustee hereunder;


 


(3)                                  such
Holder or Holders have offered to the Trustee, and if requested, shall have
provided, reasonable indemnity against the costs, expenses and liabilities to
be incurred in compliance with such request;


 


(4)                                  the
Trustee for 60 days after its receipt of such notice, request and offer of
indemnity (or if requested, receipt of indemnity) has failed to institute any
such proceeding; and


 


(5)                                  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 principal amount of
the Outstanding Securities.


 


Notwithstanding any of
the foregoing, no one or more of such Holders shall have any right in any
manner whatever by virtue of, or by availing of, any provision of this Indenture
to affect, disturb or prejudice the rights of any other of such Holders, or to
obtain or seek to obtain priority or preference over any other of such Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all such Holders.


 


SECTION 5.8                          Unconditional
Right of Holders to Receive Principal and Interest and to Convert.


 


Notwithstanding any other
provision in this Indenture, the Holder of any Security shall have the right,
which is absolute and unconditional, to receive payment of the principal of and
(subject to Section 3.7) interest and Additional Interest, if any, on such
Security on the respective Stated Maturities expressed in such Security (or, in
the case of redemption, repurchase or purchase on the Redemption Date,
Repurchase Date or Purchase Date, as the case may be), and to convert such
Security in accordance with Article XII, and to institute suit for the
enforcement of any such payment and right to convert, and such rights shall not
be impaired without the consent of such Holder.


 


53

















 


SECTION 5.9                          Restoration
of Rights and Remedies.


 


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


 


SECTION 5.10                    Rights
and Remedies Cumulative.


 


Except as otherwise
provided with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Securities in the last paragraph of Section 3.6, no right
or remedy herein conferred upon or reserved to the Trustee or to the Holders of
Securities is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. 
The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.


 


SECTION 5.11                    Delay
or Omission Not Waiver.


 


No delay or omission of
the Trustee or of any Holder of any Security to exercise any right or remedy
accruing upon any Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or any acquiescence
therein.  Every right and remedy given
by this Article V or by law to the Trustee or to the Holders of Securities
may be exercised from time to time, and as often as may be deemed expedient, by
the Trustee or (subject to the limitations contained in this Indenture) by the
Holders of Securities as the case may be.


 


SECTION 5.12                    Control
by Holders of Securities.


 


Subject to
Section 6.3, the Holders of a majority in principal amount of the
Outstanding Securities shall have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred on the Trustee, provided that


 


(1)                                  such
direction shall not be in conflict with any rule of law or with this Indenture,


 


(2)                                  the
Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction, and


 


(3)                                  the
Trustee need not take any action that might involve it in personal liability or
be unjustly prejudicial to the Holders of Securities not consenting.


 


54

















 


SECTION 5.13                    Waiver
of Past Defaults.


 


Certain Holders, through
the written consent of not less than a majority in principal amount of the
Outstanding Securities, may on behalf of the Holders of all the Securities
waive any past default hereunder and its consequences, except a default (A) in
the payment of the principal of or interest and Additional Interest, if any, on
any Security, (B) in respect of a covenant or provision hereof which under
Article VIII cannot be modified or amended without the consent of the
Holder of each Outstanding Security affected, or (C) in respect of a provision
or covenant hereof for the personal protection or benefit of the Trustee, without
the Trustee’s consent.


 


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


 


SECTION 5.14                    Undertaking
for Costs.


 


All parties to this
Indenture agree, and each Holder of any Security by his acceptance thereof
shall be deemed to have agreed, that any court may in its discretion require,
in any suit for the enforcement of any right or remedy under this Indenture, or
any suit against the Trustee for any action taken, suffered or omitted by it as
Trustee, the filing by any party litigant in such suit of an undertaking to pay
the costs of such suit, and that such court may in its discretion assess
reasonable costs, including reasonable attorneys’ fees, against any party
litigant in such suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant; but the provisions of this
Section 5.14 shall not apply to any suit instituted by Trustee, to any
suit instituted by any Holder, or group of Holders, holding in the aggregate
more than 10% in principal amount of the Outstanding Securities, or to any suit
instituted by any Holder of any Security for the enforcement of the payment of
the principal of or interest on any Security on or after the respective Stated
Maturity or Maturities expressed in such Security (or, in the case of
redemption or repurchase, on or after the Redemption Date, Repurchase Date or
Purchase Date, as the case may be) or for the enforcement of the right to
convert any Security in accordance with Article XII.


 


SECTION 5.15                    Waiver
of Stay, Usury or Extension Laws.


 


The Company covenants (to
the extent that it may lawfully do so) that it will not at any time insist
upon, or plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay, usury or extension law wherever enacted, now or at any
time hereafter in force, that may affect the covenants or the performance of
this Indenture; and the Company (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law and covenants
that it will not hinder, delay or impede by reason of such law 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.


 


55



















ARTICLE VI


 


THE TRUSTEE


 


SECTION 6.1         Certain
Duties and Responsibilities.


 


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


 


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


 


(ii)           in the absence of bad
faith on its part, the Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and conforming to the
requirements of this Indenture, but in the case of any such certificates or
opinions which by any provision hereof are specifically required to be
furnished to the Trustee, the Trustee shall be under a duty to examine the same
to determine whether or not they conform to the requirements of this Indenture,
but not to verify the contents thereof.


 


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


 


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


 


(i)            this paragraph (3)
shall not be construed to limit the effect of paragraph (1) of this Section;


 


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


 


(iii)          the Trustee shall not be
liable with respect to any action taken or omitted to be taken by it in good
faith in accordance with the direction of the Holders of a majority in
principal amount of the Outstanding Securities relating to the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this Indenture;
and


 


(iv)          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, if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.


 


56

















 


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


 


SECTION 6.2         Notice
of Defaults.


 


Within 90 days after the
occurrence of any default hereunder as to which the Trustee has received
written notice, the Trustee shall give to all Holders of Securities, in the
manner provided in Section 1.6, notice of such default, unless such
default shall have been cured or waived; provided,
however, that, except in the case of a default in the payment of the
principal of or interest on any Security the Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee or a trust committee of directors or Responsible Officers of the
Trustee in good faith determines that the withholding of such notice is in the
interest of the Holders; and provided, further, that in the case of any default
of the character specified in Section 5.1(4), no such notice to Holders of
Securities shall be given until at least 60 days after the occurrence thereof
or, if applicable, the expiration of the cure period specified therein.  For the purpose of this Section, the term
“default” means any event that is, or after notice or lapse of time or both
would become, an Event of Default.


 


SECTION 6.3         Certain
Rights of Trustee.


 


Subject to the provisions
of Section 6.1:


 


(1)           the Trustee may rely,
and shall be protected in acting or refraining from acting, upon any
resolution, Officers’ Certificate, other certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, coupon, other evidence of indebtedness or other paper or document
(collectively, the “Documents”) believed by it to be genuine and to have been
signed or presented by the proper party or parties, and the Trustee need not
investigate any fact or matter stated in such Documents;


 


(2)           any request or
direction of the Company mentioned herein shall be sufficiently evidenced by a
Company Request or Company Order and any resolution of the Board of Directors
shall be sufficiently evidenced by a Board Resolution;


 


(3)           whenever in the
administration of this Indenture the Trustee shall deem it desirable that a
matter be proved or established prior to taking, suffering or omitting any
action hereunder, the Trustee (unless other evidence be the one specifically
prescribed) may, in the absence of bad faith on its part, request and rely upon
an Officers’ Certificate or Opinion of Counsel;


 


(4)           the Trustee may consult
with counsel of its selection and the advice of such counsel or any Opinion of
Counsel shall be full and complete authorization and protection in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon;


 


(5)           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 of Securities
pursuant to this Indenture, unless such Holders shall have offered, and, if
requested by the


 


57

















 


Trustee, delivered to the Trustee reasonable security
or indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;


 


(6)           the Trustee shall not
be bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, coupon, other
evidence of indebtedness or other paper or document, but the Trustee 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;


 


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


 


(8)           except with respect to
Section 10.1 hereof, the Trustee shall have no duty to inquire as to the
performance of the Company’s covenants in Article X hereof.  In addition, the Trustee shall not be deemed
to have knowledge of any default or Event of Default except (i) any Event of
Default occurring pursuant to Sections 5.1(1), 5.1(2) and 10.1 hereof or (ii)
any default or Event of Default of which the Trustee shall have received
written notification in the manner set forth in this Indenture or an officer in
the corporate trust administration of the Trustee shall have obtained actual
knowledge.  Delivery of reports, information
and documents to the Trustee under Section 10.9 hereof is for
informational purposes only and the Trustee’s receipt of the foregoing 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 thereunder (as to which the Trustee is entitled to
rely exclusively on an Officers’ Certificate); and


 


(9)           the grant of a
permissive power to the Trustee shall not be construed to be a mandatory
requirement to act (unless otherwise so provided herein).


 


SECTION 6.4         Not
Responsible for Recitals or Issuance of Securities.


 


The recitals contained
herein and in the Securities (except the Trustee’s certificates of
authentication) shall be taken as the statements of the Company, and the
Trustee assumes no responsibility for their correctness.  The Trustee makes no representations as to
the validity or sufficiency of this Indenture, of the Securities or of the
Common Stock issuable upon the conversion of the Securities.  The Trustee shall not be accountable for the
use or application by the Company of Securities or the proceeds thereof.


 


SECTION 6.5         May
Hold Securities, Act as Trustee under Other Indentures.


 


The Trustee, any
Authenticating Agent, any Paying Agent, any Conversion Agent or any other agent
of the Company or the Trustee, in its individual or any other capacity, may
become the owner or pledgee of Securities and may otherwise deal with the
Company with the same rights it would have if it were not Trustee,
Authenticating Agent, Paying Agent, Conversion Agent or such other agent.


 


58

















 


The Trustee may become
and act as trustee under other indentures under which other securities, or
certificates of interest or participation in other securities, of the Company
are outstanding in the same manner as if it were not Trustee hereunder.


 


SECTION 6.6         Money
Held in Trust.


 


Money or property held by
the Trustee in trust hereunder need not be segregated from other funds except
to the extent required by law.  The
Trustee shall be under no liability for interest on any money received by it
hereunder except as otherwise agreed in writing with the Company.


 


SECTION 6.7         Compensation
and Reimbursement.


 


The Company agrees:


 


(1)           to pay the Trustee from
time to time such reasonable compensation as the Company and the Trustee shall
from time to time agree in writing for its acceptance of this Indenture and for
all services rendered by it hereunder (which compensation shall not be limited
by any provision of law in regard to the compensation of a trustee of an
express trust);


 


(2)           except as otherwise
expressly provided herein, to reimburse the Trustee upon its request for all
reasonable expenses, disbursements and advances incurred or made by the Trustee
(including reasonable costs and expenses of enforcing this Indenture and
defending itself against any claim (whether asserted by the Company, any Holder
of Securities or any other Person) or liability in connection with the exercise
of any of its powers or duties hereunder) in accordance with any provision of
this Indenture (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense, disbursement
or advance as may be attributable to its negligence, willful misconduct or bad
faith; and


 


(3)           to indemnify the
Trustee (and its directors, officers, employees and agents) for, and to hold it
harmless against, any loss, liability or expense incurred without negligence,
willful misconduct or bad faith on its part, arising out of or in connection
with the acceptance or administration of this trust, including the reasonable
costs, expenses and reasonable attorneys’ fees of defending itself against any
claim or liability in connection with the exercise or performance of any of its
powers or duties hereunder.


 


To secure the Company’s
payment obligations to the Trustee in this Section 6.7, the Trustee shall
have a claim prior to the Securities on all money or property held or
controlled by the Trustee, other than money or property held in trust to pay
principal and interest and Additional Interest, if any, on the Securities.


 


When the Trustee incurs
expenses or renders services in connection with an Event of Default specified
in Section 5.1(5) or Section 5.1(6), the expenses (including the
reasonable charges of its counsel) and the compensation for the services are
intended to constitute expenses of the administration under any applicable
Federal or state bankruptcy, insolvency or other similar law.


 


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The provisions of this
Section shall survive the termination of this Indenture or the earlier
resignation or removal of the Trustee.


 


SECTION 6.8         Corporate
Trustee Required; Eligibility.


 


There shall at all times
be a Trustee hereunder which shall be a Person that is eligible pursuant to the
Trust Indenture Act to act as such, having (or be part of a holding company
group with) a combined capital and surplus of at least U.S. $50,000,000,
subject to supervision or examination by Federal or state authority, and in
good standing.  The Trustee or an
Affiliate of the Trustee shall maintain an office or agency in the Borough of
Manhattan, The City of New York.  If
such corporation publishes reports of condition at least annually, pursuant to
law or to the requirements of said supervising or examining authority, then for
the purposes of this Section, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published.  If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article and a
successor shall be appointed pursuant to Section 6.9.


 


SECTION 6.9         Resignation
and Removal; Appointment of Successor.


 


(1)           No resignation or
removal of the Trustee and no appointment of a successor Trustee pursuant to
this Article shall become effective until the acceptance of appointment by
the successor Trustee in accordance with the applicable requirements of
Section 6.10.


 


(2)           The Trustee may resign
at any time by giving written notice thereof to the Company.  If the instrument of acceptance by a
successor Trustee required by Section 6.10 shall not have been delivered
to the Trustee within 30 days after the giving of such notice of resignation,
the resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor Trustee.


 


(3)           The Trustee may be
removed at any time by an Act of the Holders of a majority in principal amount
of the Outstanding Securities, delivered to the Trustee and the Company.  If the instrument of acceptance by a successor
Trustee required by Section 6.10 shall not have been delivered to the
Trustee within 30 days after the giving of such notice of removal, the removed
Trustee may petition any court of competent jurisdiction for the appointment of
a successor Trustee.


 


(4)           If at any time:


 


(i)            the Trustee shall
cease to be eligible under Section 6.8 and shall fail to resign after
written request therefor by the Company or by any Holder of a Security who has
been a bona fide Holder of a Security for at least six months, or


 


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


 


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then, in any such case
(i) the Company by a Board Resolution may remove the Trustee, or (ii) subject
to Section 5.14, any Holder of a Security who has been a bona fide Holder
of a Security for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.


 


(5)           If the Trustee shall
resign, be removed or become incapable of acting, or if a vacancy shall occur
in the office of Trustee for any cause, the Company, by a Board Resolution,
shall promptly appoint a successor Trustee and shall comply with the applicable
requirements of this Section 6.9 and Section 6.10.  If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor Trustee
shall be appointed by Act of the Holders of a majority in principal amount of
the Outstanding Securities delivered to the Company and the retiring Trustee,
the successor Trustee so appointed shall, forthwith upon its acceptance of such
appointment in accordance with the applicable requirements of
Section 6.10, become the successor Trustee and supersede the successor
Trustee appointed by the Company.  If no
successor Trustee shall have been so appointed by the Company or the Holders of
Securities and accepted appointment in the manner required by this Section 6.9
and Section 6.10, any Holder of a Security who has been a bona fide Holder
of a Security for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee.


 


(6)           The Company shall give
notice of each resignation and each removal of the Trustee and each appointment
of a successor Trustee to all Holders of Securities in the manner provided in
Section 1.6.  Each notice shall
include the name of the successor Trustee and the address of its Corporate
Trust Office.


 


SECTION 6.10       Acceptance
of Appointment by Successor.


 


Every successor Trustee
appointed hereunder shall execute, acknowledge and deliver to the Company and
to the retiring Trustee an instrument accepting such appointment, and thereupon
the resignation or removal of the retiring Trustee shall become effective and
such successor Trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of the retiring
Trustee; but, on the request of the Company or the successor Trustee, such
retiring Trustee shall, upon payment of its charges, execute and deliver an
instrument transferring to such successor Trustee all the rights, powers and
trusts of the retiring Trustee and shall duly assign, transfer and deliver to
such successor Trustee all property and money held by such retiring Trustee
hereunder.  Upon request of any such
successor Trustee, the Company shall execute any and all instruments for more fully
and certainly vesting in and confirming to such successor Trustee all such
rights, powers and trusts.


 


No successor Trustee
shall accept its appointment unless at the time of such acceptance such
successor Trustee shall be eligible under this Article.


 


SECTION 6.11       Merger,
Conversion, Consolidation or Succession to Business.


 


Any corporation into
which the Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation


 


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to which the
Trustee shall be a party, or any corporation succeeding to all or substantially
all of the corporate trust business of the Trustee (including the trust created
by this Indenture), shall be the successor of the Trustee hereunder, provided
such corporation shall be otherwise eligible under this Article, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto.  In case any Securities
shall have been authenticated, but not delivered, by the Trustee then in
office, any successor by merger, conversion or consolidation to such
authenticating Trustee may adopt such authentication and deliver the Securities
so authenticated with the same effect as if such successor Trustee had itself
authenticated such Securities.


 


SECTION 6.12       Authenticating
Agents.


 


The Trustee may, with the
consent of the Company, appoint an Authenticating Agent or Agents acceptable to
the Company with respect to the Securities, which Authenticating Agent shall be
authorized to act on behalf of the Trustee to authenticate Securities issued
upon exchange or substitution pursuant to this Indenture.


 


Securities authenticated
by an Authenticating Agent shall be entitled to the benefits of this Indenture
and shall be valid and obligatory for all purposes as if authenticated by the
Trustee hereunder, and every reference in this Indenture to the authentication
and delivery of Securities by the Trustee or the Trustee’s certificate of
authentication shall be deemed to include authentication and delivery on behalf
of the Trustee by an Authenticating Agent and a certificate of authentication
executed on behalf of the Trustee by an Authenticating Agent.  Each Authenticating Agent shall be subject
to acceptance by the Company and shall at all times be a corporation organized
and doing business under the laws of the United States of America, any State
thereof or the District of Columbia, authorized under such laws to act as
Authenticating Agent and subject to supervision or examination by government or
other fiscal authority.  If at any time
an Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section 6.12, such Authenticating Agent shall resign
immediately in the manner and with the effect specified in this
Section 6.12.


 


Any corporation into
which an Authenticating Agent may be merged or converted or with which it may
be consolidated, or any corporation resulting from any merger, conversion or
consolidation to which such Authenticating Agent shall be a party, or any
corporation succeeding to the corporate agency or corporate trust business of
an Authenticating Agent, shall continue to be an Authenticating Agent, provided
such corporation shall be otherwise eligible under this Section 6.12,
without the execution or filing of any paper or any further act on the part of
the Trustee or the Authenticating Agent.


 


An Authenticating Agent
may resign at any time by giving written notice thereof to the Trustee and to
the Company.  The Trustee may at any
time terminate the agency of an Authenticating Agent by giving written notice
thereof to such Authenticating Agent and to the Company.  Upon receiving such a notice of resignation
or upon such a termination, or in case at any time such Authenticating Agent
shall cease to be eligible in accordance with the provisions of this
Section 6.12, the Trustee may appoint a successor Authenticating Agent
which shall be subject to acceptance by the Company.  Any successor Authenticating Agent upon acceptance of its
appointment hereunder shall become vested with all the rights, powers and
duties of its predecessor hereunder, with like effect as if originally named as
an Authenticating Agent.  No


 


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successor
Authenticating Agent shall be appointed unless eligible under the provisions of
this Section 6.12.


 


The Company agrees to pay
to each Authenticating Agent from time to time reasonable compensation for its
services under this Section 6.12. 
If an Authenticating Agent is appointed with respect to the Securities
pursuant to this Section 6.12, the Securities may have endorsed thereon,
in addition to or in lieu of the Trustee’s certification of authentication, an
alternative certificate of authentication in the following form:


 


This is one of the
Securities referred to in the within-mentioned Indenture.


 


	
   

  	
  U.S. BANK NATIONAL
  ASSOCIATION

  as Trustee

  
	
   

  	
   

  
	
   

  	
  By:

  
	
   

  	
   

  
	
   

  	
  as Authenticating Agent

  
	
   

  	
   

  
	
   

  	
  By:

  
	
   

  	
   

  
	
   

  	
  Authorized Signatory

  



 


 


SECTION 6.13       Disqualification;
Conflicting Interests.


 


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


 


SECTION 6.14       Preferential
Collection of Claims Against Company.


 


If and when the Trustee
shall be or become a creditor of the Company (or any other obligor upon the
Securities), the Trustee shall be subject to the provisions of the Trust
Indenture Act regarding the collection of claims against the Company (or any
such other obligor).


 


ARTICLE VII


 


CONSOLIDATION,
MERGER, CONVEYANCE, TRANSFER OR LEASE


 


SECTION 7.1         Company
May Consolidate, Etc. Only on Certain Terms.


 


The Company shall not
consolidate with or merge with or into any other Person or convey, transfer or
lease all or substantially all of its properties or assets to another Person,
unless:


 


(1)           the Company is the
surviving Person, or the resulting, surviving or transferee Person, if other
than the Company is organized and existing under the laws of the United States
of America, any State thereof or the District of Columbia;


 


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(2)           the successor Person,
if other than the Company, assumes, by supplemental indenture satisfactory in
form to the Trustee, all of the Company’s obligations under the Securities and
the Indenture;


 


(3)           after giving effect to
such transaction, there is no Event of Default, and no event which, after
notice or passage of time or both, would become an Event of Default; and


 


(4)           the Company has
delivered to the Trustee an Officers’ Certificate stating that such
consolidation, merger, conveyance, transfer or lease complies with these
requirements and an Opinion of Counsel as to clauses (1) and (2) above.


 


SECTION 7.2         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 all or substantially all the properties and
assets of the Company in accordance with Section 7.1, the successor Person
formed by such consolidation or into or with 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 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 VIII


 


SUPPLEMENTAL
INDENTURES


 


SECTION 8.1         Supplemental
Indentures Without Consent of Holders of Securities.


 


Without the consent of
any Holders of Securities the Company, when authorized by a Board Resolution,
and the Trustee, at any time and from time to time, may enter into one or more
indentures supplemental hereto for any of the following purposes:


 


(1)           to evidence the
succession of another Person to the Company and the assumption by any such
successor of the covenants and obligations of the Company herein and in the
Securities as permitted by Article VII of this Indenture; or


 


(2)           to add to the covenants
of the Company for the benefit of the Holders of Securities or to surrender any
right or power herein conferred upon the Company; or


 


(3)           to provide security or
additional security for, or provide for a guaranty of, the Securities; or


 


(4)           to make provision with
respect to the conversion rights of Holders of Securities pursuant to Section 12.11
or to make provision with respect to the repurchase rights of Holders of
Securities pursuant to Section 13.5; or


 


(5)           to make any changes or
modifications to this Indenture necessary in connection with the registration
of any Registrable Securities under the Securities Act as contemplated by


 


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Section 10.11, provided such action pursuant to
this clause (5) shall not adversely affect the interests of the Holders of
Securities in any material respect; or


 


(6)           to comply with the
requirements of the Trust Indenture Act or the rules and regulations of the
Commission thereunder in order to effect or maintain the qualification of this
Indenture under the Trust Indenture Act, as contemplated by this Indenture or
otherwise; or


 


(7)           to evidence and provide
for the acceptance of appointment hereunder by a successor Trustee; or


 


(8)           to cure any ambiguity,
to correct or supplement any provision herein that may be inconsistent with any
other provision herein or that is otherwise defective, or to make any other
provisions with respect to matters or questions arising under this Indenture as
the Company and the Trustee may deem necessary or desirable, provided such
action pursuant to this clause (8) shall not adversely affect the interests of
the Holders of Securities in any material respect nor make any modification as
to which the consent of each Holder is required under Section 8.2 hereof.


 


Upon Company Request,
accompanied by a Board Resolution authorizing the execution of any such
supplemental indenture, and subject to and upon receipt by the Trustee of the
documents described in Section 8.3 hereof, the Trustee shall join with the
Company in the execution of any supplemental indenture authorized or permitted
by the terms of this Indenture and to make any further appropriate agreements
and stipulations that may be therein contained.


 


Notwithstanding any other
provision of the Indenture or the Securities, the Registration Rights Agreement
and the obligation to pay Additional Interest thereunder may be amended,
modified or waived in accordance with the provisions of the Registration Rights
Agreement.


 


SECTION 8.2         Supplemental
Indentures with Consent of Holders of Securities.


 


With the consent of the
Holders of not less than a majority in aggregate principal amount of the
Outstanding Securities, by the Act of said Holders delivered to the Company and
the Trustee, the Company, when authorized by a Board Resolution, and the
Trustee may enter into an indenture or indentures supplemental hereto for the
purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Indenture or of modifying in any manner the
rights of the Holders of Securities under this Indenture; provided, however, that no such
supplemental indenture shall, without the consent or affirmative vote of the
Holder of each Outstanding Security affected thereby,


 


(1)           change the Stated
Maturity of the principal of or any installment of interest on any Security, or
reduce the principal amount of or the rate of interest payable thereon or
reduce the amount payable upon a redemption, purchase or repurchase, or change
the place or currency of payment of the principal of or interest on any
Securities (including Additional Interest, if any, except as may be effected
through an amendment with the Registration Rights Agreement in accordance with
its terms, or Redemption Price, Repurchase Price or Purchase Price in respect
of such Security), extend the time for payment of interest or Additional
Interest, if any, on any Security or impair the right to institute suit for the
enforcement of any payment in respect of any Security on or after the Stated
Maturity thereof (or, in the case of redemption or any repurchase,


 


65

















 


on or after the Redemption Date, Repurchase Date or
Purchase Date as the case may be) or, except as permitted by
Section 12.11, adversely affect the right of Holders to convert any
Security as provided in Article XII; or


 


(2)           after the occurrence of
a Designated Event, adversely change the Company’s obligation to repurchase any
Security upon a Designated Event; or


 


(3)           impair the right of a
Holder to convert any Security or reduce the number of shares of Common Stock
or the amount of any other property received upon conversion; or


 


(4)           reduce the requirements
of Section 9.4 for quorum or voting, or reduce the percentage in principal
amount of the Outstanding Securities the consent of whose Holders is required
for any such supplemental indenture or the consent of whose Holders is required
for any waiver of compliance with certain provisions of this Indenture or
certain defaults hereunder and their consequences provided for in this
Indenture; or


 


(5)           modify any of the
provisions of this Section 8.2 or Sections 5.13 or 10.12, except to
increase any percentage contained herein or therein or to provide that certain
other provisions of this Indenture cannot be modified or waived without the
consent of the Holder of each Outstanding Security affected thereby; or


 


(6)           modify the provisions
of Article XIII in a manner adverse to the Holders; or


 


(7)           modify the provisions
of Article XI in a manner adverse to the Holders; or


 


(8)           modify any of the
provisions of Section 10.9.


 


In addition, a
modification or amendment that would, prior to the occurrence of a Designated
Event, adversely change the Company’s obligation to repurchase any Security
upon a Designated Event requires the consent of the Holders of two-thirds in
aggregate principal amount of Outstanding Securities.


 


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


 


SECTION 8.3         Execution
of Supplemental Indentures.


 


In executing, or
accepting the additional trusts created by, any supplemental indenture
permitted by this Article or the modifications thereby of the trusts
created by this Indenture, the Trustee shall be entitled to receive, and
(subject to Sections 6.1 and 6.3) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture, and that such supplemental indenture
has been duly authorized, executed and delivered by the Company and constitutes
a valid and legally binding obligation of the Company enforceable against the
Company in accordance with its terms. 
The Trustee may, but shall not be obligated to, enter into any such
supplemental indenture which affects the Trustee’s own rights, duties or
immunities under this Indenture or otherwise.


 


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SECTION 8.4         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 appertaining thereto shall be
bound thereby.


 


SECTION 8.5         Reference
in Securities to Supplemental Indentures.


 


Securities authenticated
and delivered after the execution of any supplemental indenture pursuant to this
Article may, and shall if required by the Trustee, bear a notation in form
approved by the Trustee as to any matter provided for in such supplemental
indenture.  If the Company shall so
determine, new Securities so modified as to conform, in the opinion of the
Company and the Trustee, to any such supplemental indenture may be prepared and
executed by the Company and authenticated and delivered by the Trustee in
exchange for Outstanding Securities.


 


SECTION 8.6         Notice
of Supplemental Indentures.


 


Promptly after the
execution by the Company and the Trustee of any supplemental indenture pursuant
to the provisions of Section 8.2, the Company shall give notice to all
Holders of Securities of such fact, setting forth in general terms the
substance of such supplemental indenture, in the manner provided in
Section 1.6.  Any failure of the
Company to give such notice, or any defect therein, shall not in any way impair
or affect the validity of any such supplemental indenture.


 


ARTICLE IX


 


MEETINGS OF
HOLDERS OF SECURITIES


 


SECTION 9.1         Purposes
for Which Meetings May Be Called.


 


A meeting of Holders of
Securities may be called at any time and from time to time pursuant to this
Article to make, give or take any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this Indenture
to be made, given or taken by Holders of Securities.  Nothing in this Article IX shall be construed (i) to prevent
or preclude the Trustee from otherwise calling or conducting any meeting of
Holders of Securities at which a formal vote shall not be conducted (such as
but not limited to an informational meeting), in any alternative manner that
the Trustee shall deem appropriate, or (ii) to require that a meeting be called
or conducted in order to obtain, or in connection with, any particular request,
demand, authorization, direction, notice, consent, waiver or other action
provided in this Indenture to be made, given or taken by Holders of Securities.


 


SECTION 9.2         Call,
Notice and Place of Meetings.


 


(1)           The Trustee may at any
time call a meeting of Holders of Securities for any purpose specified in
Section 9.1, to be held at such time and at such place in the Borough of
Manhattan, The City of New York, or such other location as the Trustee shall
determine;


 


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provided, however, that any
such meeting may in the alternative be conducted by telephone conference in a
manner reasonably designed to be substantially consistent with the procedures
set forth in this Article IX. 
Notice of every meeting of Holders of Securities, setting forth the time
and the place of such meeting and in general terms the action proposed to be
taken at such meeting, shall be given, in the manner provided in
Section 1.6, not less than 21 nor more than 180 days prior to the date
fixed for the meeting.


 


(2)           In case at any time the
Company, pursuant to a Board Resolution, or the Holders of at least 10% in
principal amount of the Outstanding Securities shall have requested the Trustee
to call a meeting of the Holders of Securities for any purpose specified in
Section 9.1, by written request setting forth in reasonable detail the
action proposed to be taken at the meeting, and the Trustee shall not have
mailed the notice of such meeting within 21 days after receipt of such request
or shall not thereafter proceed to cause the meeting to be held as provided
herein, then the Company or the Holders of Securities in the amount specified,
as the case may be, may determine the time and the place in the Borough of
Manhattan, The City of New York, for such meeting and may call such meeting for
such purposes by giving notice thereof as provided in paragraph (1) of this
Section (provided that such notice shall also be sent to the Trustee).


 


SECTION 9.3         Persons
Entitled to Vote at Meetings.


 


To be entitled to vote at
any meeting of Holders of Securities, a Person shall be (i) a Holder of one or
more of the Outstanding Securities, or (ii) a Person appointed by an instrument
in writing as proxy for a Holder or Holders of one or more of the Outstanding
Securities by such Holder or Holders. 
The only Persons who shall be entitled to be present or to speak at any
meeting of Holders shall be the Persons entitled to vote at such meeting and
their counsel, any representatives of the Trustee and its counsel and any
representatives of the Company and its counsel.  Notwithstanding the foregoing or any other term to the contrary
in this Article IX, nothing in this Article IX shall preclude or
prevent the Trustee from calling or conducting a meeting of Holders of
Securities (whether pursuant to this Article IX or otherwise) at which the
Company is not allowed or entitled to be present.


 


SECTION 9.4         Quorum;
Action.


 


The Persons entitled to
vote a majority in principal amount of the Outstanding Securities shall
constitute a quorum.  In the absence of
a quorum within 30 minutes of the time appointed for any such meeting, the
meeting shall, if convened at the request of Holders of Securities, be
dissolved.  In any other case, the
meeting may be adjourned for a period of not less than 10 days as determined by
the chairman of the meeting prior to the adjournment of such meeting.  In the absence of a quorum at any such
adjourned meeting, such adjourned meeting may be further adjourned for a period
not less than 10 days as determined by the chairman of the meeting prior to the
adjournment of such adjourned meeting (subject to repeated applications of this
sentence).  Notice of the reconvening of
any adjourned meeting shall be given as provided in Section 9.2(1), except
that such notice need be given only once not less than five days prior to the
date on which the meeting is scheduled to be reconvened.  Notice of the reconvening of an adjourned
meeting shall state expressly the percentage of the principal amount of the
Outstanding Securities that shall constitute a quorum.


 


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Subject to the foregoing,
at the reconvening of any meeting adjourned for a lack of a quorum, the Persons
entitled to vote 25% in principal amount of the Outstanding Securities at the
time shall constitute a quorum for any subsequent adjournment of such meeting.


 


At a meeting or an
adjourned meeting duly reconvened and at which a quorum is present as
aforesaid, any resolution and all matters (except as limited by the proviso to
Section 8.2 and except to the extent Section 10.12 requires a
different vote) shall be effectively passed and decided if passed or decided by
the Holders of not less than a majority in principal amount of the Outstanding
Securities represented at such meeting.


 


Any resolution passed or
decisions taken at any meeting of Holders of Securities duly held in accordance
with this Section shall be binding on all the Holders of Securities
whether or not present or represented at the meeting.  The Trustee shall, in the name and at the expense of the Company,
notify all the Holders of Securities of any such resolutions or decisions
pursuant to Section 1.6.


 


SECTION 9.5         Determination
of Voting Rights; Conduct and Adjournment of Meetings.


 


(1)           Notwithstanding any
other provisions of this Indenture, the Trustee may make such reasonable
regulations as it may deem advisable for any meeting of Holders of Securities
in regard to proof of the holding of Securities and of the appointment of
proxies and in regard to the appointment and duties of inspectors of votes, the
submission and examination of proxies, certificates and other evidence of the
right to vote, and such other matters concerning the conduct of the meeting as
it shall deem appropriate.  Except as
otherwise permitted or required by any such regulations, the holding of
Securities shall be proved in the manner specified in Section 1.4 and the
appointment of any proxy shall be proved in the manner specified in
Section 1.4 or by having the signature of the Person executing the proxy
guaranteed by any bank, broker or other eligible institution participating in a
recognized medallion signature guarantee program.


 


(2)           The Trustee shall, by
an instrument in writing, appoint a temporary chairman (which may be the
Trustee) of the meeting, unless the meeting shall have been called by the
Company or by Holders of Securities as provided in Section 9.2(1), in
which case the Company or the Holders of Securities calling the meeting, as the
case may be, shall in like manner appoint a temporary chairman.  A permanent chairman and a permanent
secretary of the meeting shall be elected by vote of the Persons entitled to
vote a majority in principal amount of the Outstanding Securities represented
at the meeting.


 


(3)           At any meeting, each
Holder of a Security or proxy shall be entitled to one vote for each U.S.
$1,000 principal amount of Securities held or represented by him; provided, however, that no vote shall be
cast or counted at any meeting in respect of any Security challenged as not
Outstanding and ruled by the chairman of the meeting to be not
Outstanding.  The chairman of the
meeting shall have no right to vote, except as a Holder of a Security or proxy.


 


(4)           Any meeting of Holders
of Securities duly called pursuant to Section 9.2 at which a quorum is
present may be adjourned from time to time by Persons entitled to vote a
majority in


 


69

















 


principal amount of the Outstanding Securities
represented at the meeting, and the meeting may be held as so adjourned without
further notice.


 


SECTION 9.6         Counting
Votes and Recording Action of Meetings.


 


The vote upon any
resolution submitted to any meeting of Holders of Securities shall be by
written ballots on which shall be subscribed the signatures of the Holders of
Securities or of their representatives by proxy and the principal amounts at
Stated Maturity and serial numbers of the Outstanding Securities held or
represented by them.  The permanent
chairman of the meeting shall appoint two inspectors of votes who shall count
all votes cast at the meeting for or against any resolution and who shall make
and file with the secretary of the meeting their verified written reports in
duplicate of all votes cast at the meeting. 
A record, at least in duplicate, of the proceedings of each meeting of
Holders of Securities shall be prepared by the secretary of the meeting and
there shall be attached to said record the original reports of the inspectors
of votes on any vote by ballot taken thereat and affidavits by one or more
Persons having knowledge of the facts setting forth a copy of the notice of the
meeting and showing that said notice was given as provided in Section 9.2
and, if applicable, Section 9.4. 
Each copy shall be signed and verified by the affidavits of the
permanent chairman and secretary of the meeting and one such copy shall be
delivered to the Company (except in the case of any meeting at which the
Company was not allowed to be present) and another to the Trustee to be
preserved by the Trustee, the latter to have attached thereto the ballots voted
at the meeting.  Any record so signed
and verified shall be conclusive evidence of the matters therein stated.


 


ARTICLE X


 


COVENANTS


 


SECTION 10.1       Payment
of Principal and Interest.


 


The Company covenants and
agrees that it will duly and punctually pay the principal of and interest and
Additional Interest, if any, on the Securities in accordance with the terms of
the Securities and this Indenture.  The
Company will deposit or cause to be deposited with the Trustee or its nominee,
no later than the opening of business on the date of the Stated Maturity of any
Security or no later than the opening of business on the due date for any
installment of interest, all payments so due, which payments shall be in
immediately available funds on the date of such Stated Maturity or due date as
the case may be.


 


SECTION 10.2       Maintenance
of Offices or Agencies.


 


The Company will maintain
in the Borough of Manhattan, The City of New York, an office or agency (which
may include the Trustee) where the Securities may be surrendered for
registration of transfer or exchange or for presentation for payment or for
conversion, redemption or repurchase and where notices and demands to or upon
the Company in respect of the Securities and this Indenture may be served.  The Company will give prompt written notice
to the Trustee of the location, and any change in the location, of such office
or agency not designated or appointed by the Trustee.  If at any time the Company shall fail to maintain any such
required office or agency or shall fail to furnish the Trustee with the address
thereof, such


 


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presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office or the office or agency of the Trustee in the Borough of Manhattan, The
City of New York.


 


The Company may at any
time and from time to time vary or terminate the appointment of any such agent
or appoint any additional agents for any or all of such purposes; provided, however, that until all of the
Securities have been delivered to the Trustee for cancellation, or moneys
sufficient to pay the principal of and interest and Additional Interest, if
any, on the Securities have been made available for payment and either paid or
returned to the Company pursuant to the provisions of Section 10.3, the
Company will maintain in the Borough of Manhattan, The City of New York, an
office or agency where Securities may be presented or surrendered for payment
and conversion, which shall initially be the Corporate Trust Office of the
Trustee, where Securities may be surrendered for registration of transfer or
exchange and where notices and demands to or upon the Company in respect of the
Securities and this Indenture may be served. 
The Company will give prompt written notice to the Trustee, and notice
to the Holders in accordance with Section 1.6, of the appointment or
termination of any such agents and of the location and any change in the
location of any such office or agency.


 


The Company hereby
initially designates the Trustee as Paying Agent, Security Registrar 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, as one such office or agency of the Company for each of the aforesaid
purposes.


 


SECTION 10.3       Money
for Security Payments to Be Held in Trust.


 


If the Company shall act
as its own Paying Agent, it will, on or before each due date of the principal
of or interest, on any of the Securities, segregate and hold in trust for the
benefit of the Persons entitled thereto a sum sufficient to pay the principal
and interest, so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and the Company will promptly notify
the Trustee, in writing, of its action or failure so to act.


 


Whenever the Company
shall have one or more Paying Agents, it will, no later than the opening of
business on each due date of the principal of or interest on any Securities,
deposit with the Trustee a sum in funds immediately payable on the payment date
sufficient to pay the principal or interest, so becoming due, such sum to be
held for the benefit of the Persons entitled to such principal or interest, and
(unless such Paying Agent is the Trustee) the Company will promptly notify the
Trustee, in writing, of any failure so to act.


 


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


 


(1)           hold all sums held by
it for the payment of the principal of or interest on Securities for the
benefit of the Persons entitled thereto until such sums shall be paid to such
Persons or otherwise disposed of as herein provided;


 


(2)           give the Trustee
written notice of any default by the Company (or any other obligor upon the
Securities) in the making of any payment of principal or interest; and


 


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


 


The Company may at any
time, for the purpose of obtaining the satisfaction and discharge of this
Indenture or for any other purpose, pay, or by Company Order direct any Paying
Agent to pay, to the Trustee all sums held in trust by the Company or such
Paying Agent, such sums to be held by the Trustee upon the same trusts as those
upon which such sums were held by the Company or such Paying Agent; and, upon
such payment by any Paying Agent to the Trustee, such Paying Agent shall be
released from all further liability with respect to such money.


 


Any money deposited with
the Trustee or any Paying Agent, or then held by the Company, in trust for the
payment of the principal of or interest on any Security and remaining unclaimed
for two years after such principal or interest and Additional Interest, if any,
has become due and payable shall be paid to the Company on Company Request, or
(if then held by the Company) shall be discharged from such trust; and the
Holder of such Security shall thereafter, as an unsecured general creditor,
look only to the Company for payment thereof, and all liability of the Trustee
or such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease.


 


SECTION 10.4       Existence.


 


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


 


SECTION 10.5       Maintenance
of Properties.


 


The Company will cause
all properties used or useful in the conduct of its business and the business
of its Subsidiaries to be maintained and kept in good condition, repair and
working order and supplied with all necessary equipment and will cause to be
made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in the judgment of the Company may be necessary so
that the business carried on in connection therewith may be properly and
advantageously conducted at all times, except where the failure to do so would
not, individually or in the aggregate, have a material adverse effect on the
Company and its Subsidiaries, taken as a whole; provided, however, that nothing in this Section shall
prevent the Company from discontinuing the operation or maintenance of any of
such properties if such discontinuance is, in the judgment of the Company,
desirable in the conduct of its business and not disadvantageous in any
material respect to the Holders.


 


SECTION 10.6       Payment
of Taxes and Other Claims.


 


The Company will pay or
discharge, or cause to be paid or discharged, before the same may become
delinquent, (i) all taxes, assessments and governmental charges levied or
imposed upon the Company or any subsidiary or upon the income, profits or property
of the Company, or any subsidiary (ii) all claims for labor, materials and
supplies which, if unpaid, might by law become a lien or charge upon the
property of the Company, and (iii) subject to Section 12.8, all stamps and
other duties, if any, which may be imposed by the United States or any
political subdivision thereof or therein in connection with the issuance,
transfer, exchange or conversion


 


72

















 


of any Securities
or with respect to this Indenture; provided,
however, that, in the case of clauses (i) and (ii), the Company
shall not be required to pay or discharge or cause to be paid or discharged any
such tax, assessment, charge or claim (A) if the failure to do so will not, in
the aggregate, have a material adverse effect on the Company and its
Subsidiaries, taken as a whole, or (B) if the amount, applicability or validity
is being contested in good faith by appropriate proceedings.


 


SECTION 10.7       Registration
and Listing.


 


The Company will cause, subject
to notice of issuance, the Common Stock issuable upon conversion of the
Securities to be quoted on the Nasdaq National Market.


 


SECTION 10.8       Statement
by Officers as to Default.


 


The Company shall deliver
to the Trustee, within 120 days after the end of each fiscal year of the
Company ending after the date hereof, an Officers’ Certificate, stating whether
or not to the best knowledge of the signers thereof the Company is in default
in the performance and observance of any of the terms, provisions and
conditions of this Indenture (without regard to any period of grace or
requirement of notice provided hereunder) and, if the Company shall be in
default, specifying all such defaults and the nature and status thereof of
which they may have knowledge.


 


The Company will deliver
to the Trustee, as promptly as reasonably practicable upon becoming aware of
any default or any Event of Default under the Indenture, an Officers’
Certificate specifying with particularity such default or Event of Default and
further stating what action the Company has taken, is taking or proposes to
take with respect thereto.  For the
purpose of this Section, the term “default” means any event that is, or after
notice or lapse of time or both would become, an Event of Default.


 


Any notice required to be
given under this Section 10.8 shall be delivered to the Trustee at its
Corporate Trust Office.


 


SECTION 10.9       Delivery
of Certain Information.


 


At any time when the
Company is not subject to Section 13 or 15(d) of the Exchange Act, upon the
written request of a Holder of a Restricted Security or the holder of shares of
Common Stock issued upon conversion thereof, the Company will promptly furnish
or cause to be furnished Rule 144A Information (as defined below) to such
Holder of Restricted Securities or such holder of shares of Common Stock issued
upon conversion of Restricted Securities, or to a prospective purchaser of any
such security designated by any such Holder or holder, as the case may be, to
the extent required to permit compliance by such Holder or holder with Rule
144A under the Securities Act (or any successor provision thereto) in
connection with the resale of any such security; provided, however, that the Company shall not be required to
furnish such information in connection with any request made on or after the
date that is two years from the later of (i) the date such a security (or any
such predecessor security) was last acquired from the Company or (ii) the date
such a security (or any such predecessor security) was last acquired from an
“affiliate” of the Company within the meaning of Rule 144 under the Securities
Act (or any successor provision thereto). 
“Rule 144A Information” shall be such information as is


 


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specified pursuant
to Rule 144A(d)(4) under the Securities Act (or any successor provision
thereto).


 


SECTION 10.10     Resale
of Certain Securities.


 


During the period
beginning on the last date of original issuance of the Securities and ending on
the date that is two years from such date (or such shortened period under Rule
144(k) under the Securities Act or any successor rule), the Company will not,
will not permit any of its Subsidiaries, and will use its reasonable efforts to
not permit any other of its “affiliates” (as defined under Rule 144 under the
Securities Act or any successor provision thereto) to, resell (i) any
Securities that constitute “restricted securities” under Rule 144 or (ii) any
securities into which the Securities have been converted under this Indenture
that constitute “restricted securities” under Rule 144, that in either case
have been reacquired by any of them. 
The Trustee shall have no responsibility in respect of the Company’s
performance of its agreement in the preceding sentence.


 


SECTION 10.11     Registration
Rights.


 


If Additional Interest is
payable under the Registration Rights Agreement to any Holder, the Company
shall deliver to the Trustee a certificate to that effect stating (i) the
amount of Additional Interest that is payable to such Holder and (ii) the date
on which Additional Interest is payable. 
Unless and until a Responsible Officer of the Trustee receives at the
Corporate Trust Office such a certificate, the Trustee may assume without inquiry
that no Additional Interest is payable. 
If Additional Interest has been paid by the Company directly to the
persons entitled to them, the Company shall deliver to the Trustee a
certificate setting forth the particulars of such payment.


 


SECTION 10.12     Waiver
of Certain Covenants.


 


The Company may omit in
any particular instance to comply with any covenant or condition set forth in
Sections 10.5 and 10.6 (other than a covenant or condition which under
Section 8.2 cannot be modified or amended without the consent of the
Holder of each Outstanding Security affected), if before the time for such
compliance the Holders shall, through the consent of not less than a majority
in principal amount of the Outstanding Securities represented at such meeting,
either waive such compliance in such instance or generally waive compliance
with such covenant or condition, but no such waiver shall extend to or affect
such covenant or condition except to the extent so expressly waived, and, until
such waiver shall become effective, the obligations of the Company and the
duties of the Trustee or any Paying or Conversion Agent in respect of any such
covenant or condition shall remain in full force and effect.  Nothing in this Section is intended to
limit the application of Sections 5.13, 8.1 and 8.2.


 


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ARTICLE XI


 


REDEMPTION OF
SECURITIES


 


SECTION 11.1       Right
of Redemption.


 


The Securities may be
redeemed at the option of the Company at any time on or after June 15,
2009, in whole or in part, upon not less than 20 nor more than 60 days’ notice
to the Holders prior to the Redemption Date at the following Redemption Prices
(expressed as a percentage of the principal amount of Securities to be
redeemed) payable in cash, together with accrued and unpaid interest and Additional
Interest, if any, to, but excluding, the Redemption Date:


 




	
  Date

  	
   

  	
  Redemption
  Price

  	
   

  
	
  June 15,
  2009 to June 14, 2010

  	
   

  	
  100.857

  	
  %

  
	
  June 15,
  2010 to June 14, 2011

  	
   

  	
  100.429

  	
  %

  
	
  June 15,
  2011 and thereafter

  	
   

  	
  100

  	
  %

  






 


provided,
however, that (1) installments of interest, if any, on
Securities with an Interest Payment Date on or prior to such Redemption Date
will be payable to the Holders of such Securities, or one or more Predecessor
Securities, of record at the close of business on the relevant Record Dates and
(2) the Company may not redeem any Securities if the Company has failed to pay
any interest on the Securities and such failure to pay is continuing, or if the
principal amount of the Securities has been accelerated.


 


SECTION 11.2       Applicability
of Article.


 


Redemption of Securities
at the election of the Company or otherwise, as permitted or required by any
provision of the Securities or this Indenture, shall be made in accordance with
such provision and this Article XI.


 


SECTION 11.3       Election
to Redeem; Notice to Trustee.


 


The election of the
Company to redeem any Securities shall be evidenced by a Board Resolution.  In case of any redemption at the election of
the Company of any of the Securities, the Company shall, at least 45 days prior
to the Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee in writing of such Redemption
Date.


 


SECTION 11.4       Selection
by Trustee of Securities to Be Redeemed.


 


If less than all the
Securities are to be redeemed, the particular Securities to be redeemed shall
be selected by the Trustee within five Business Days after it receives the
notice described in Section 11.3, from the Outstanding Securities not
previously called for redemption, by pro rata selection, by lot or otherwise in
accordance with the procedures of the Depositary.


 


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If any Security selected
for partial redemption is converted in part before termination of the
conversion right with respect to the portion of the Security so selected, the
converted portion of such Security shall be deemed (so far as may be) to be the
portion selected for redemption. 
Securities that have been converted during a selection of Securities to
be redeemed may be treated by the Trustee as Outstanding for the purpose of
such selection.  The Trustee shall
promptly notify the Company and each Security Registrar in writing of the
securities selected for redemption and, in the case of any Securities selected
for partial redemption, the principal amount thereof to be redeemed.


 


For all purposes of this
Indenture, unless the context otherwise requires, all provisions relating to
the redemption of Securities shall relate, in the case of any Securities
redeemed or to be redeemed only in part, to the portion of the principal amount
of such Securities which has been or is to be redeemed.


 


SECTION 11.5       Notice
of Redemption.


 


Notice of redemption
shall be given in the manner provided in Section 1.6 to the Holders of
Securities to be redeemed not less than 20 nor more than 60 days prior to the
Redemption Date, and such notice shall be irrevocable.  The Company shall, concurrently with the
giving of such notice, publish a Press Release including the information
required to be included in such notice of redemption hereunder.


 


All notices of redemption
shall state:


 


(1)           the Redemption Date,


 


(2)           the Redemption Price
and accrued interest thereon and Additional Interest, if any, to, but
excluding, the Redemption Date,


 


(3)           if less than all Outstanding
Securities are to be redeemed, the aggregate principal amount of Securities to
be redeemed and the aggregate principal amount of Securities which will be
outstanding after such partial redemption,


 


(4)           that on the Redemption
Date the Redemption Price and interest and Additional Interest, if any, to, but
excluding, the Redemption Date, will become due and payable upon each such
Security to be redeemed, and that interest and Additional Interest, if any,
thereon shall cease to accrue on and after said date,


 


(5)           the Conversion Rate,
the date on which the right to convert the Securities to be redeemed will
terminate and the places where such Securities may be surrendered for
conversion, and


 


(6)           the place or places
where such Securities are to be surrendered for payment of the Redemption Price
and accrued interest and Additional Interest, if any, to, but excluding, the
Redemption Date.


 


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In case of a partial
redemption, the notice shall specify the serial and CUSIP numbers (if any) and
the portions thereof called for redemption and that transfers and exchanges may
occur on or prior to the Redemption Date.


 


Notice of redemption of
Securities to be redeemed at the election of the Company shall be given by the
Company or, at the Company’s written request, by the Trustee in the name of and
at the expense of the Company.  Notice
of redemption of Securities to be redeemed at the election of the Company
received by the Trustee shall be given by the Trustee to each Paying Agent in
the name of and at the expense of the Company.


 


SECTION 11.6       Deposit
of Redemption Price.


 


On or prior to the
Redemption Date, the Company shall deposit with the Trustee (or, if the Company
is acting as its own Paying Agent, segregate and hold in trust as provided in
Section 10.3) an amount of money (which shall be in immediately available
funds on such Redemption Date) sufficient to pay the Redemption Price of, and
accrued interest and Additional Interest, if any, to, but excluding, the
Redemption Date on all the Securities which are to be redeemed on that date.


 


If any Security called
for redemption is converted, any money deposited with the Trustee or so
segregated and held in trust for the redemption of such Security shall (subject
to any right of the Holder of such Security or any Predecessor Security to
receive interest as provided in the last paragraph of Section 3.7 and
Section 12.2) be paid to the Company on Company Request or, if then held
by the Company, shall be discharged from such trust.


 


SECTION 11.7       Securities
Payable on Redemption Date.


 


Notice of redemption
having been given as aforesaid, the Securities so to be redeemed shall, on the
Redemption Date, become due and payable at the Redemption Price therein
specified and from and after such date (unless the Company shall default in the
payment of the Redemption Price) such Securities shall cease to bear interest
and Additional Interest, if any.  Upon
surrender of any Security for redemption in accordance with said notice such
Security shall be paid by the Company at the Redemption Price together with
accrued and unpaid interest and Additional Interest, if any to, but excluding,
the Redemption Date; provided, however,
that installments of interest on Securities with an Interest Payment Date on or
prior to the Redemption Date shall be payable to Holders of such Securities, or
one or more Predecessor Securities, registered as such on the relevant Record
Date according to their terms and the provisions of Section 3.7.


 


If any Security called
for redemption shall not be so paid upon surrender thereof for redemption, the
principal amount of and, to the extent permitted by applicable law, accrued
interest on such Security shall, until paid bear interest from the Redemption
Date at a rate of 4% per annum, and such Security shall remain convertible
until the Redemption Price of such Security (or portion thereof, as the case
may be) shall have been paid or duly provided for.


 


Any Security that is to
be redeemed only in part shall be surrendered at the Corporate Trust Office or
an office or agency of the Company designated for that purpose pursuant to
Section 10.2 (with, if the Company or the Trustee so requires, due
endorsement by, or a written


 


77

















 


instrument of
transfer in form satisfactory to the Company and the Trustee duly executed by,
the Holder thereof or his attorney duly authorized in writing), and the Company
shall execute, and the Trustee shall authenticate and make available for delivery
to the Holder of such Security without service charge, a new Security or
Securities, of any authorized denomination as requested by such Holder, in
aggregate principal amount equal to and in exchange for the unredeemed portion
of the principal of the Security so surrendered.


 


SECTION 11.8       Conversion
Arrangement on Call for Redemption.


 


In connection with any
redemption of Securities, the Company may arrange for the purchase and
conversion of any such Securities called for redemption by entering into an
agreement with one or more investment banks or other purchasers (the
“Purchasers”) to purchase all or a portion of such Securities by paying to the
Trustee in trust for the Holders, on or before the Redemption Date, an amount
not less than the applicable Redemption Price (together with accrued interest
to the Redemption Date, including Additional Interest, if any) of such
Securities.  Notwithstanding anything to
the contrary contained in this Article XI, the obligation of the Company
to pay the Redemption Price (together with accrued interest to the Redemption
Date, including Additional Interest, if any) shall be deemed to be satisfied
and discharged to the extent such amount is so paid by such Purchasers.  If such an agreement is entered into (a copy
of which shall be filed with the Trustee prior to the close of business on the
Business Day immediately prior to the Redemption Date), any Securities called
for redemption that are not duly surrendered for conversion by the Holders
thereof may, at the option of the Company, be deemed, to the fullest extent
permitted by law, and consistent with any such agreement or agreements with
such Purchasers, to be acquired by such Purchasers from such Holders and
(notwithstanding anything to the contrary contained in Article XII)
surrendered by such Purchasers for conversion, all as of immediately prior to
the close of business on the Redemption Date (and the right to convert any such
Securities shall be extended through such time), subject to payment of the
above amount as aforesaid.  At the
direction of the Company, the Trustee shall hold and dispose of any such amount
paid to it by the Purchasers to the Holders in the same manner as it would
monies deposited with it by the Company for the redemption of Securities.  Without the Trustee’s prior written consent,
no arrangement between the Company and such Purchasers for the purchase and
conversion of any Securities shall increase or otherwise affect any of the
powers, duties, responsibilities or obligations of the Trustee as set forth in
this Indenture, and the Company agrees to indemnify the Trustee from, and hold
it harmless against, any loss, liability or expense arising out of or in
connection with any such arrangement for the purchase and conversion of any
Securities between the Company and such Purchasers, including the reasonable
costs and expenses, including reasonable legal fees, incurred by the Trustee in
the defense of such claim or liability.


 


ARTICLE XII


 


CONVERSION OF
SECURITIES


 


SECTION 12.1       Conversion
Privilege and Conversion Rate.


 


(a)           Subject to and upon
compliance with the provisions of this Article, at the option of the Holder
thereof, any portion of a Security that is an integral multiple of $1,000
principal


 


78

















 


amount may be
converted into fully paid and nonassessable shares (calculated as to each
conversion to the nearest 1/100th of a share) of Common Stock of the Company at
the Conversion Rate, determined as hereinafter provided, in effect at the time
of conversion and subject to adjustment as described below, as follows:


 


(1)           if, on or prior to
June 15, 2019, the Closing Sale Price of the Common Stock, for at least 20
Trading Days in the period of the 30 consecutive Trading Days ending on the
eleventh Trading Day of any fiscal quarter, is more than 120% of the then
current Conversion Price of the Securities, then the Holder thereof will be
entitled to convert such Security until and including the eleventh Trading Day
of the immediately following fiscal quarter;


 


(2)           if, on any date after
June 15, 2019, the Closing Sale Price of the Common Stock is more than
120% of the then current Conversion Price of the Securities, then the Holder
thereof will be entitled to convert such Security at all times thereafter;


 


(3)           if the Company elects
to call the Securities for redemption, then the Holder thereof will be entitled
to convert such Security (or the portion of the Security called for redemption,
if less than all), until the close of business on the Business Day prior to the
Redemption Date;


 


(4)           if the Company
distributes to all or substantially all holders of Common Stock, rights,
options or warrants (other than with respect to a Rights Plan) entitling them
to purchase Common Stock at less than the Closing Sale Price of the Common
Stock on the last Trading Day preceding the declaration for such distribution,
then the Holder thereof will be entitled to convert such Security in the period
described below;


 


(5)           if the Company
distributes to all or substantially all holders of Common Stock, cash, assets,
debt securities or Capital Stock of any Subsidiary, which distribution has a
per share value as determined by the Board of Directors exceeding 5% of the
Closing Sale Price of the Common Stock on the last Trading Day preceding the
declaration for such distribution, then the Holder thereof will be entitled to
convert such Security in the period described below; or


 


(6)           if the Company becomes
a party to a consolidation, merger or sale of all or substantially all of the
Company’s assets where such consolidation, merger or sale of all or
substantially all of the Company’s assets constitutes a Change in Control or
such event occurs that would have been a Change in Control but for the
occurrence of one or both of the exceptions to the definition of a Change in
Control contained in the proviso immediately following
Section 13.4(2)(iii), then the Holder thereof will be entitled to convert
such Security in the period described below.


 


A Security for which a
Holder has delivered a Repurchase Notice pursuant to Section 13.3 may be
surrendered for conversion only if such Repurchase Notice is withdrawn under
the terms of this Indenture.


 


In the case of a
distribution contemplated in clauses (4) and (5) of this Section 12.1(a),
the Company will notify Holders (and the Trustee) at least 20 days prior to the
ex-dividend date for such distribution (the “Distribution Notice”).  Once the Company has given the Distribution
Notice, Holders may surrender their Securities for conversion at any time until
the earlier of the


 


79

















 


close of business
on the last Business Day preceding the ex-dividend date or the Company’s
announcement that such distribution will not take place, in which event the
conversion request shall be deemed withdrawn automatically.  If in the future the Company adopts a Rights
Plan, Holders will not have any conversion right pursuant to clause (4) above
or otherwise, solely as a result of the issuance of Rights pursuant to the
Rights Plan.  Notwithstanding the
foregoing, in the event of a distribution contemplated in clauses (4) and (5)
of this Section 12.1(a), Holders may not convert the Securities if the
Holders may participate in such distribution without converting their Securities.


 


In the event of a
consolidation, merger or sale of all or substantially all of the Company’s
assets as contemplated in clause (6) of this Section 12.1(a), the Company
will notify Holders (and the Trustee) at least 20 days prior to the anticipated
closing date of such transaction (the “Merger Notice”).  Once the Company has given the Merger
Notice, the Holders may, in the event of such consolidation, merger or sale of
all or substantially all of the Company’s assets, as contemplated in clause (6)
above, surrender Securities for conversion at any time from and after the date
which is 15 days prior to the anticipated effective date of such transaction
until the date which is 15 days after the actual effective date of such
transaction.


 


With respect to clause
(1) of this Section 12.1(a), the Conversion Agent will determine, on
behalf of the Company, on the first Business Day succeeding the first day of
the fiscal quarter on which the Securities would be convertible, whether the
Securities are convertible as set forth in such clause (1) based upon the
Closing Sale Price of the Common Stock and the then current Conversion Price
and, if so, will notify the Company. 
With respect to clause (2) of this section 12.1(a), the Conversion
Agent will determine, on behalf of the Company, daily on any date after
June 15, 2019, whether the Securities are convertible as set forth in such
clause (2) based upon the Closing Sale Price of the Common Stock and the then
current Conversion Price and, if so, will notify the Company.


 


(b)           Subject to the further
provisions of this Article XII, at any time prior to June 15, 2019, a
Holder of a Security may also 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) for the five Business Day period after any five consecutive Trading
Day period in which the average of the Trading Price for the Securities in such
period was less than 98% of the average Conversion Value for the Securities
during such period.


 


The “Conversion Value”
for the Securities is equal to the product of (i) the Closing Sale Price of the
Common Stock on a given day and (ii) the then current Conversion Rate.


 


If, for purposes of
determining the Trading Price, the Trustee cannot reasonably obtain at least
one bid for $2,000,000 principal amount of this Security from a nationally
recognized securities dealer, then the Trading Price per $1,000 principal
amount of this Security will be deemed to be less than 98% of the product of
the Closing Sale Price of the Common Stock and the number of shares issuable
upon conversion of $1,000 principal amount of this Security.


 


In connection with any
conversion upon satisfaction of the above Trading Price condition, the Trustee
shall have no obligation to determine the Trading Price of this Security unless
the Company has requested such determination; and the Company shall have no


 


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obligation to make
such request unless the Holder provides the Company with reasonable evidence
that the Trading Price per $1,000 principal amount of this Security would be
less than 98% of the product of the closing sale price of the Common Stock and
the number of shares of Common Stock issuable upon conversion of $1,000 principal
amount of this Security.  At such time,
the Company shall instruct the Trustee to determine the Trading Price of this
Security beginning on the next Trading Day and on each successive Trading Day
until the Trading Price per $1,000 principal amount of this Security is greater
than or equal to 98% of the product of the Closing Sale Price of the Common
Stock and the number of shares issuable upon conversion of $1,000 principal
amount of this Security.


 


(c)           The conversion right,
subject to the conditions described in clauses (a) and (b) of this
Section 12.1, shall commence on the initial issuance date of the
Securities and expire at the close of business on the date of Maturity,
subject, in the case of conversion of any Global Security, to any Applicable
Procedures.  In case a Holder of a
Security exercises his right to require the Company to repurchase the Security,
such conversion right in respect of the Security, or portion thereof so called,
shall expire at the close of business on the Business Day immediately preceding
the Repurchase Date unless the Company defaults in making the payment due upon
repurchase (subject as aforesaid to any Applicable Procedures with respect to
any Global Security).


 


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


 


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


 


The rate at which shares
of Common Stock shall be delivered upon conversion (herein called the
“Conversion Rate”) shall be initially 33.5909 shares of Common Stock for each U.S.
$1,000 principal amount of Securities. 
The Conversion Rate shall be adjusted in certain instances as provided
in this Article XII.


 


SECTION 12.2       Exercise
of Conversion Privilege.


 


In order to exercise the
conversion privilege, the Holder of any Security to be converted shall
surrender such Security that is an integral multiple of $1,000 as permitted
above, duly endorsed in blank, at the Corporate Trust Office of the Trustee in
the Borough of Manhattan, The City of New York, or at such other office or agency
of the Company, maintained for that purpose pursuant to Section 10.2,
accompanied by a duly signed and completed conversion notice substantially in
the form set forth in Section 2.4 stating that the Holder elects to
convert such Security or, if less than the entire principal amount thereof is
to be converted, the portion thereof (which shall be in integral multiples of
$1,000) to be converted, and payments in respect of taxes, if any, as described
in Section 12.8 hereto.


 


Each Security surrendered
for conversion (in whole or in part) during the Record Date Period shall
(except in the case of any Security or portion thereof which has been called
for redemption on a Redemption Date, is repurchasable on a Repurchase Date or
purchasable on a


 


81

















 


Purchase Date,
occurring, in any such case, within such Record Date Period and, as a result,
the right to convert such Security would otherwise terminate in such period if
not exercised) be accompanied by payment in New York Clearing House funds or
other funds acceptable to the Company of an amount equal to the interest, if
any, payable on the Interest Payment Date ending such Record Date Period on the
principal amount of such Security (or part thereof, as the case may be) being
surrendered for conversion, less any previously due interest payment as of the
Conversion Date as to which the Company is in arrears.  The interest so payable on such Interest
Payment Date with respect to any Security (or portion thereof, if applicable)
that is surrendered for conversion during the Record Date Period shall be paid
to the Holder of such Security as of such Record Date in an amount equal to the
interest that would have been payable on such Security if such Security had
been converted as of the close of business on such Interest Payment Date.  Interest payable on any Interest Payment
Date in respect of any Security surrendered for conversion on or after such
Interest Payment Date shall be paid to the Holder of such Security as of the
Record Date next preceding such Interest Payment Date, notwithstanding the
exercise of the right of conversion.


 


Except as provided in the
preceding paragraph, no cash payment or adjustment shall be made upon any
conversion on account of any interest accrued from the Interest Payment Date
next preceding the conversion date, in respect of any Security (or part
thereof, as the case may be) surrendered for conversion, or on account of any
dividends on the Common Stock issued upon conversion.  The Company’s delivery to the Holder of the number of shares of
Common Stock (and cash in lieu of fractions thereof, as provided in this
Indenture) into which a Security is convertible will be deemed to satisfy the
Company’s obligation to pay the principal amount of the Security, provided,
however, that such delivery of shares of Common Stock shall not relieve
the Company of its obligation to pay interest as to which the Company is in
arrears at the time of conversion and such interest shall remain payable in
accordance with the terms of this Indenture .


 


Securities shall be
deemed to have been converted immediately prior to the close of business on the
day of surrender of such Securities for conversion in accordance with the
foregoing provisions, and at such time the rights of the Holders of such
Securities as Holders shall cease, and the Person or Persons entitled to
receive the Common Stock issuable upon conversion shall be treated for all
purposes as the record holder or holders of such Common Stock at such time.  As promptly as practicable on or after the
Conversion Date, the Company shall issue and deliver to the Trustee, for
delivery to the Conversion Agent who will in turn deliver to the Holder (unless
a different Person is indicated on the Conversion Notice), a certificate or
certificates for the number of full shares of Common Stock issuable upon
conversion, together with payment in lieu of any fraction of a share, as
provided in Section 12.3 (the Conversion Agent having been provided with
such certificates and funds by the Company and/or its transfer agent).


 


All shares of Common
Stock delivered upon such conversion of Restricted Securities shall bear
restrictive legends substantially in the form of the legends required to be set
forth on the Restricted Securities pursuant to Section 3.5 and shall be
subject to the restrictions on transfer provided in such legends.  Neither the Trustee nor any agent maintained
for the purpose of such conversion shall have any responsibility for the
inclusion or content of any such restrictive legends on such Common Stock; provided, however, that the Trustee or any
agent maintained for the purpose of such conversion shall have provided, to the
Company or to the 


 


82

















 


Company’s transfer
agent for such Common Stock, prior to or concurrently with a request to the
Company to deliver such Common Stock, written notice that the Securities
delivered for conversion are Restricted Securities.


 


In the case of any
Security which is converted in part only, upon such conversion the Company
shall execute and the Trustee shall authenticate and deliver to the Holder
thereof, at the expense of the Company, a new Security or Securities of
authorized denominations in an aggregate principal amount equal to the
unconverted portion of the principal amount of such Security.  A Security may be converted in part, but
only if the principal amount of such Security to be converted is any integral
multiple of U.S. $1,000 and the principal amount of such security to remain
Outstanding after such conversion is equal to U.S. $1,000 or any integral
multiple of $1,000 in excess thereof.


 


If shares of Common Stock
to be issued upon conversion of a Restricted Security, or Securities to be
issued upon conversion of a Restricted Security in part only, are to be
registered in a name other than that of the beneficial owner of such Restricted
Security, then such Holder must deliver to the Conversion Agent a Surrender
Certificate, dated the date of surrender of such Restricted Security and signed
by such beneficial owner, as to compliance with the restrictions on transfer
applicable to such Restricted Security. 
Neither the Trustee nor any Conversion Agent, Registrar or Transfer
Agent shall be required to register in a name other than that of the beneficial
owner, shares of Common Stock or Securities issued upon conversion of any such
Restricted Security not so accompanied by a properly completed Surrender
Certificate.


 


SECTION 12.3       Fractions
of Shares.


 


No fractional shares of
Common Stock shall be issued upon conversion of any Security or
Securities.  If more than one Security
shall be surrendered for conversion at one time by the same Holder, the number
of full shares which shall be issuable upon conversion thereof shall be
computed on the basis of the aggregate principal amount of the Securities (or
specified portions thereof) so surrendered. 
Instead of any fractional share of Common Stock that would otherwise be
issuable upon conversion of any Security or Securities (or specified portions
thereof), the Company shall calculate and pay a cash adjustment in respect of
such fraction (calculated to the nearest 1/100th of a share) in an amount equal
to the same fraction of the Closing Sale Price at the close of business on the
day of conversion.


 


SECTION 12.4       Adjustment
of Conversion Rate.


 


(1)           The Conversion Rate
shall be subject to adjustments from time to time as follows:


 


(i)            In case the Company
shall pay or make a dividend or other distribution on shares of Common Stock
payable in shares of Common Stock, the Conversion Rate in effect at the opening
of business on the day following the date fixed for the determination of
stockholders entitled to receive such dividend or other distribution shall be
increased by dividing such Conversion Rate by a fraction of which the numerator
shall be the number of shares of Common Stock outstanding at the close of
business on the date fixed for such determination and the denominator shall be
the sum of such number of shares and the total number of shares constituting
such dividend or other distribution, such increase to become effective
immediately


 


83

















 


after the opening of business on the day following the
date fixed for such determination.  If,
after any such date fixed for determination, any dividend or distribution is
not in fact paid, the Conversion Rate shall be immediately readjusted,
effective as of the date the Board of Directors determines not to pay such
dividend or distribution, to the Conversion Rate that would have been in effect
if such determination date had not been fixed. 
For the purposes of this paragraph (i), the number of shares of Common
Stock at any time outstanding shall not include shares held in the treasury of
the Company but shall include shares issuable in respect of scrip certificates
issued in lieu of fractions of shares of Common Stock.  The Company will not pay any dividend or
make any distribution on shares of Common Stock held in the treasury of the
Company.


 


(ii)           In case the Company
shall issue rights, options or warrants (in any case other than in connection
with a Rights Plan) to all holders of its Common Stock entitling them to
subscribe for or purchase shares of Common Stock at a price per share less than
the Current Market Price per share (determined as provided in paragraph (3) of
this Section 12.4) of the Common Stock on the date fixed for the
determination of stockholders entitled to receive such rights, options or
warrants (other than any rights, options or warrants that by their terms will
also be issued to any Holder upon conversion of a Security into shares of
Common Stock without any action required by the Company or any other Person),
the Conversion Rate in effect at the opening of business on the day following the
date fixed for such determination shall be increased by dividing such
Conversion Rate by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding at the close of business on the date fixed
for such determination plus the number of shares of Common Stock that the
aggregate of the offering price of the total number of shares of Common Stock
so offered for subscription or purchase would purchase at such Current Market
Price and the denominator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such determination
plus the number of shares of Common Stock so offered for subscription or
purchase, such increase to become effective immediately after the opening of
business on the day following the date fixed for such determination.  If, after any such date fixed for
determination, any such rights, options or warrants are not in fact issued, or
are not exercised prior to the expiration thereof, the Conversion Rate shall be
immediately readjusted, effective as of the date such rights, options or
warrants expire, or the date the Board of Directors determines not to issue
such rights, options or warrants, to the Conversion Rate that would have been
in effect if the unexercised rights, options or warrants had never been granted
or such determination date had not been fixed, as the case may be.  For the purposes of this paragraph (ii), the
number of shares of Common Stock at any time outstanding shall not include
shares held in the treasury of the Company but shall include shares issuable in
respect of scrip certificates issued in lieu of fractions of shares of Common
Stock.  The Company will not issue any
rights, options or warrants in respect of shares of Common Stock held in the
treasury of the Company.


 


(iii)          In case outstanding
shares of Common Stock shall be subdivided into a greater number of shares of
Common Stock, the Conversion Rate in effect at the opening of business on the
day following the day upon which such subdivision becomes effective shall be
proportionately increased, and, conversely, in case outstanding shares of
Common Stock shall be combined into a smaller number of shares of Common Stock,
the Conversion Rate in effect at the opening of business on the day following
the day upon which such subdivision or combination becomes effective shall be
proportionately reduced, such increase or reduction, as 


 


84

















 


the case may be, to become effective immediately after
the opening of business on the day following the day upon which such
subdivision or combination becomes effective.


 


(iv)          In case the Company
shall, by dividend or otherwise, distribute to all holders of its Common Stock
evidences of its indebtedness, shares of any class of capital stock or other
property (including cash or assets or securities (other than rights pursuant to
a Rights Plan)), but excluding (A) any rights, options or warrants referred to
in paragraph 1(ii) of this Section, (B) any dividend or distribution paid
exclusively in cash, (C) any dividend or distribution referred to in paragraph
1(i) of this Section and (D) any consideration distributed in any merger
or consolidation to which Section 12.11 applies), the Conversion Rate
shall be adjusted so that the same shall equal the rate determined by dividing
the Conversion Rate in effect immediately prior to the close of business on the
date fixed for the determination of stockholders entitled to receive such
distribution by a fraction of which the numerator shall be the Current Market
Price per share (determined as provided in paragraph (3) of this
Section 12.4) of the Common Stock on the date fixed for such determination
less the then fair market value of the portion of the assets, shares or
evidences of indebtedness so distributed applicable to one share of Common
Stock and the denominator shall be such Current Market Price per share of the
Common Stock, such adjustment to become effective immediately prior to the
opening of business on the day following the date fixed for the determination
of stockholders entitled to receive such distribution, or in the case of a Spin
Off, immediately prior to the opening of business on the day following the last
Trading Day of the Measurement Period. 
If after any such date fixed for determination, any such distribution is
not in fact made, the Conversion Rate shall be immediately readjusted,
effective as of the date of the Board of Directors determines not to make such
distribution, to the Conversion Rate that would have been in effect if such
determination date had not been fixed.


 


In the event the Company
distributes shares of capital stock of a Subsidiary, the Conversion Rate will
be adjusted, if at all, based on the market value of the Subsidiary stock so
distributed relative to the market value of the Common Stock, as described
below.


 


The Board of Directors
shall determine fair market values for the purposes of this
Section 12.4(1)(iv), whose determination shall be conclusive and described
in a Board Resolution filed with the Trustee; provided,
however, that in respect of a dividend or other distribution of
shares of capital stock of a class or series, or similar equity interest, of or
relating to a Subsidiary or other business unit of the Company which has a
Subsidiary Closing Price (a “Spin-off”), the fair market value of the
securities to be distributed shall equal the average of the daily Subsidiary
Closing Price of such securities for the five consecutive Trading Days
commencing on and including the sixth Trading Day of such securities after the
effectiveness of the Spin-off (the “Measurement Period”); provided, further,
that in the event that an underwritten initial public offering of the
securities in the Spin-off occurs simultaneously with the Spin-off, fair market
value of the securities distributed in the Spin-off shall be the initial public
offering price of such securities and the market price per share of the Common
Stock shall mean the Closing Sale Price for the Common Stock on the same
Trading Day.


 


(v)           In case the Company or
any of its Subsidiaries shall make a tender or exchange offer for Common Stock
(for the avoidance of doubt, excluding options, warrants, purchase rights and
other securities convertible, exchangeable or exercisable for Common


 


85

















 


Stock), to the extent that the cash and value of any
other consideration included in the payment per share of Common Stock in such
offer exceeds the Closing Sale Price of the Common Stock on the Trading Day
next succeeding the last date on which tenders or exchanges may be made
pursuant to such tender or exchange offer, and such tender or exchange offer
shall expire, then, immediately prior to the opening of business on the day
after the last date (the “Expiration Date”) tenders could have been made
pursuant to such tender offer (as such offer may have been amended), the
Conversion Rate shall be increased so that the Conversion Rate shall equal the
rate determined by multiplying the Conversion Rate in effect immediately prior
to close of business on the Expiration Date by a fraction of which the
numerator shall be the sum of (x) the aggregate consideration (determined as
the sum of the aggregate amount of cash consideration and the aggregate fair
market value (as determined by the Board of Directors, whose determination
shall be conclusive evidence thereof and which shall be evidenced by an
Officers’ Certificate delivered to the Trustee thereof) of any other
consideration) payable to stockholders based on the acceptance (up to any
maximum specified in the terms of the tender offer) of all shares validly
tendered and not withdrawn as of the last time at which such tenders could have
been made on the Expiration Date (the “Expiration Time”) (the shares deemed so
accepted, up to any such maximum, being referred to as the “Purchased Shares”)
and (y) the product of the number of shares of Common Stock outstanding (less
any Purchased Shares and excluding any shares held in the treasury of the
Company) at the Expiration Time and the Current Market Price per share of
Common Stock (as determined in accordance with subsection (3) of this
Section 12.4) on the Trading Day next succeeding the Expiration Date, and
the denominator shall be the product of the number of shares of Common Stock
outstanding (including tendered shares but excluding any shares held in the
treasury of the Company) at the Expiration Time multiplied by the Current
Market Price per share of the Common Stock (as determined in accordance with
subsection (3) of this Section 12.4) on the Trading Day next
succeeding the Expiration Date, such increase to become effective immediately
prior to the opening of business on the day following the Expiration Date.  In the event that the Company is obligated
to purchase shares pursuant to any such tender offer, but the Company is
permanently prevented by applicable law from effecting any or all such
purchases or any or all such purchases are rescinded, the Conversion Rate shall
again be adjusted to be the Conversion Rate which would have been in effect
based upon the number of shares actually purchased.  If the application of this Section 12.4(1)(v) to any tender
offer would result in a decrease in the Conversion Rate, no adjustment shall be
made for such tender offer under this Section 12.4(1)(v).


 


For purposes of this
Section 12.4(1)(v), the term “tender offer” shall mean and include both
tender offers and exchange offers, all references to “purchases” of shares in
tender offers (and all similar references) shall mean and include both the
purchase of shares in tender offers and the acquisition of shares pursuant to
exchange offers, and all references to “tendered shares” (and all similar
references) shall mean and include shares tendered in both tender offers and
exchange offers.


 


(vi)          In case the Company
shall, by dividend or otherwise, distribute cash to all holders of its
outstanding Common Stock (excluding any cash that is distributed as part of a
distribution referred to in paragraph 1(iv) of this Section or cash
distributed upon a merger or consolidation to which Section 12.11 applies)
then, and in each such case, immediately after the close of business on such
date for determination, the Conversion Rate shall be adjusted to the rate
determined by multiplying the Conversion Rate in effect immediately prior to
the close of


 


86

















 


business on the date fixed for determination of the
stockholders entitled to receive such distribution by a fraction (X) the
numerator of which shall be equal to the Current Market Price per share
(determined as provided in paragraph (3) of this Section) of the Common Stock
on the date fixed for such determination plus the amount per share of such
dividend or distribution and (Y) the denominator of which shall be equal to the
Current Market Price per share (determined as provided in paragraph (3) of this
Section 12.4) of the Common Stock on such date fixed for determination.


 


(2)           The reclassification of
Common Stock into securities other than Common Stock (other than any
reclassification upon a consolidation or merger to which Section 12.11
applies) shall be deemed to involve (a) a distribution of such securities other
than Common Stock to all holders of Common Stock (and the effective date of
such reclassification shall be deemed to be “the date fixed for the
determination of stockholders entitled to receive such distribution” and “the
date fixed for such determination” within the meaning of paragraph 1(iv) of
this Section), and (b) a subdivision or combination, as the case may be, of the
number of shares of Common Stock outstanding immediately prior to such
reclassification into the number of shares of Common Stock outstanding
immediately thereafter (and the effective date of such reclassification shall
be deemed to be “the day upon which such subdivision becomes effective” or “the
day upon which such combination becomes effective,” as the case may be, and
“the day upon which such subdivision or combination becomes effective” within
the meaning of paragraph 1(iii) of this Section 12.4).


 


(3)           For the purpose of (A)
any computation under paragraphs 1(ii), (iv) or (v) of this Section 12.4,
the “Current Market Price” per share of Common Stock on any date shall be
calculated by the Company and be the average of the daily Closing Sale Prices
for the 10 consecutive Trading Days selected by the Company commencing not more
than 20 Trading Days before, and (I) in the case of paragraphs (1)(ii) or (iv)
of this Section 12.4, ending not later than, the earlier of the date fixed
for determination and the day before the “ex-date” with respect to the issuance
or distribution requiring such computation or (II) in the case of paragraph
(1)(v) of this Section 12.4, ending not later than, the Expiration Date
with respect to the tender offer requiring such computation; and (B) any
computation under paragraph (1)(vi) of this Section 12.4, the “Current
Market Price” per share of Common Stock on any date shall be calculated by the
Company and be the average of the daily Closing Sale Prices for the first 10
consecutive Trading Days from and including the first “ex-date” with respect to
the dividend or other distribution requiring such computation.  For purposes of this paragraph, the term
“ex-date,” when used with respect to any issuance or distribution, means the
first date on which the Common Stock trades regular way in the applicable
securities market or on the applicable securities exchange without the right to
receive such issuance or distribution.


 


(4)           All calculations under
this Article shall be made to the nearest U.S. $0.01 or to the nearest
one-one-hundredth (1/100th) of a share, as the case may be.


 


(5)           The Company may make
such increases in the Conversion Rate, for the remaining term of the Securities
or any shorter term, in addition to those required by paragraphs (1)(i), (ii),
(iii), (iv), (v) and (vi) of this Section 12.4, as it considers to be
advisable in order to avoid or diminish any income tax to any holders of shares
of Common Stock resulting from any dividend or distribution of stock or
issuance of rights or warrants to purchase or subscribe for stock or


 


87

















 


from any event treated as such for income tax
purposes.  The Company shall have the
power to resolve any ambiguity or correct any error in the calculations
contemplated by this paragraph (5) and its actions in so doing shall, absent
manifest error, be final and conclusive.


 


(6)           Notwithstanding the
foregoing provisions of this Section, no adjustment of the Conversion Rate shall
be required to be made (a) upon the issuance of shares of Common Stock pursuant
to any present or future plan for the reinvestment of dividends or (b) because
of a tender or exchange offer of the character described in Rule 13e-4(h)(5)
under the Exchange Act or any successor rule thereto.


 


(7)           To the extent permitted
by applicable law, the Company from time to time may increase the Conversion
Rate by any amount and for any amount of time if the Board of Directors shall
have made a determination that such increase would be in the best interests of
the Company, which determination shall be conclusive; provided, however, that no such increase
shall be taken into account for purposes of determining whether the Closing
Sale Price of the Common Stock equals or exceeds 105% of the Conversion Price
in connection with an event which would otherwise be a Change in Control
pursuant to Section 13.4.  Whenever
the Conversion Rate is increased pursuant to the preceding sentence, the
Company shall give notice of the increase to the Holders in the manner provided
in Section 1.6, and such notice shall state the increased Conversion Rate
and the period during which it will be in effect.  The Company will comply with the rules and regulations
promulgated under the Exchange Act, to the extent applicable in connection with
such notice.


 


(8)           To the extent that the
Company has a Rights Plan in effect upon conversion of the Securities pursuant
to this Article XII: (i) if such Rights have not separated from the Common
Stock prior to the conversion of the Securities, each share of Common Stock
issued upon conversion of the Securities pursuant to this Article XII
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
Rights Plan; and (ii) if such Rights have separated from the Common Stock prior
to the conversion of the Securities, the Conversion Rate will be adjusted as
though the Rights were being distributed to all holders of Common Stock on the
date of such separation.  If such an
adjustment is made and the Rights are later redeemed, invalidated or
terminated, then a corresponding reversing adjustment will be made to the
Conversion Rate on an equitable basis.


 


(9)           Notwithstanding the
foregoing provisions of this Section, no adjustment of the Conversion Rate
shall be required to be made until the cumulative adjustments amount to 1.0% or
more of the Conversion Rate; provided,
however, that any adjustments which by reason of this paragraph (9)
are not required to be made shall be carried forward and taken into account in
any subsequent adjustment.


 


SECTION 12.5       Notice
of Adjustments of Conversion Rate.


 


Whenever the Conversion
Rate is adjusted as herein provided:


 


(1)           the Company shall
compute the adjusted Conversion Rate in accordance with Section 12.4 and
shall prepare a certificate signed by the Chief Financial Officer of the
Company


 


88

















 


setting forth the adjusted Conversion Rate and showing
in reasonable detail the facts upon which such adjustment is based, and such
certificate shall promptly be filed with the Trustee and with each Conversion
Agent; and


 


(2)           upon each such
adjustment, a notice stating that the Conversion Rate has been adjusted and
setting forth the adjusted Conversion Rate shall be required, and as soon as
practicable after it is required, such notice shall be provided by the Company
to all Holders in accordance with Section 1.6.


 


Neither the Trustee nor
any Conversion Agent shall be under any duty or responsibility with respect to
any such certificate or the information and calculations contained therein,
except to exhibit the same to any Holder of Securities desiring inspection
thereof at its office during normal business hours, and shall not be deemed to
have knowledge of any adjustment in the Conversion Rate unless and until a
Responsible Officer of the Trustee shall have received such a certificate.  Until a Responsible Officer of the Trustee
receives such a certificate, the Trustee and each Conversion Agent may assume
without inquiry that the last Conversion Rate of which the Trustee has
knowledge of remains in effect.


 


SECTION 12.6       Notice
of Certain Corporate Action.


 


In case:


 


(1)           the Company shall
declare a dividend (or any other distribution) on its Common Stock payable (i)
otherwise than exclusively in cash or (ii) exclusively in cash in an amount
that would require any adjustment pursuant to Section 12.4; or


 


(2)           the Company shall
authorize the granting to all or substantially all of the holders of its Common
Stock of rights, options or warrants to subscribe for or purchase any shares of
capital stock of any class or of any other rights; or


 


(3)           of any reclassification
of the Common Stock, or of any consolidation, merger or share exchange to which
the Company is a party and for which approval of any stockholders of the
Company is required, or of the conveyance, sale, transfer or lease of all or
substantially all of the assets of the Company; or


 


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


 


then the Company shall
cause to be filed at each office or agency maintained for the purpose of
conversion of Securities pursuant to Section 10.2, and shall cause to be
provided to all Holders in accordance with Section 1.6, at least 20 days
(or 10 days in any case specified in clause (1) or (2) above) prior to the
applicable record or effective date hereinafter specified, a notice stating (x)
the date on which a record is to be taken for the purpose of such dividend,
distribution, rights, options or warrants, or, if a record is not to be taken,
the date as of which the holders of Common Stock of record to be entitled to
such dividend, distribution, rights, options or warrants are to be determined
or (y) the date on which such reclassification, consolidation, merger,
conveyance, transfer, sale, lease, dissolution, liquidation or winding up is
expected to become effective, and the date as of which it is expected that
holders of Common Stock of record shall be entitled to


 


89

















 


exchange their shares of
Common Stock for securities, cash or other property deliverable upon such
reclassification, consolidation, merger, conveyance, transfer, sale, lease,
dissolution, liquidation or winding up. 
Neither the failure to give such notice or the notice referred to in the
following paragraph nor any defect therein shall affect the legality or
validity of the proceedings described in clauses (1) through (4) of this
Section 12.6.  If at the time the
Trustee shall not be the conversion agent, a copy of such notice shall also
forthwith be filed by the Company with the Trustee.


 


The Company shall cause
to be filed at the Corporate Trust Office and each office or agency maintained
for the purpose of conversion of Securities pursuant to Section 10.2, and
shall cause to be provided to all Holders in accordance with Section 1.6,
notice of any tender offer by the Company or any Subsidiary for all or any
portion of the Common Stock at or about the time that such notice of tender
offer is provided to the public generally.


 


SECTION 12.7       Company
to Reserve Common Stock.


 


The Company shall at all
times reserve and keep available, free from preemptive rights, out of its
authorized but unissued Common Stock, for the purpose of effecting the
conversion of Securities, the full number of shares of Common Stock then
issuable upon the conversion of all Outstanding Securities.


 


SECTION 12.8       Taxes
on Conversions.


 


Except as provided in the
next sentence, the Company will pay any and all taxes and duties that may be
payable in respect of the issue or delivery of shares of Common Stock on
conversion of Securities pursuant hereto. 
The Company shall not, however, be required to pay any tax or duty that
may be payable in respect of (i) income of the Holder (including cash received
in lieu of fractional shares of Common Stock), or (ii) any transfer involved in
the issue and delivery of shares of Common Stock in a name other than that of
the Holder of the Security or Securities to be converted, and no such issue or
delivery shall be made unless and until the Person requesting such issue has
paid to the Company the amount of any such tax or duty, or has established to
the satisfaction of the Company that such tax or duty has been paid.


 


SECTION 12.9       Covenant
as to Common Stock.


 


The Company agrees that
all shares of Common Stock that may be delivered upon conversion of Securities,
upon such delivery, will have been duly authorized and validly issued and will
be fully paid and nonassessable and will rank equally with the other shares of
the Company’s Common Stock and, except as provided in Section 12.8, the
Company will pay all taxes, liens and charges with respect to the issue
thereof.


 


SECTION 12.10     Cancellation
of Converted Securities.


 


All Securities delivered
for conversion shall be delivered to the Trustee or its agent to be canceled by
or at the direction of the Trustee, which shall dispose of the same as provided
in Section 3.9.


 


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SECTION 12.11     Provision
in Case of Consolidation, Merger or Sale of Assets.


 


In case of any
consolidation or merger of the Company with or into any other Person, any
merger of another Person with or into the Company (other than a consolidation
or merger that does not result in any reclassification, conversion, exchange or
cancellation of outstanding shares of Common Stock of the Company) or any
conveyance, sale, transfer or lease of all or substantially all of the assets
of the Company (other than a conveyance, sale, transfer or lease of all or
substantially all of the assets of the Company that does not result in any
reclassification, conversion, exchange or cancellation of outstanding shares of
Common Stock of the Company), the Person formed by such consolidation or
resulting from such merger or which acquires such assets, as the case may be,
shall execute and deliver to the Trustee a supplemental indenture providing
that the Holder of each Security then Outstanding shall have the right
thereafter, during the period such Security shall be convertible as specified
in Section 12.1, to convert such Security only into the kind and amount of
securities, cash and other property receivable upon such consolidation, merger,
conveyance, sale, transfer or lease by a holder of the number of shares of
Common Stock of the Company into which such Security might have been converted
immediately prior to such consolidation, merger, conveyance, sale, transfer or
lease, assuming such holder of Common Stock of the Company (i) is not (A) a
Person with which the Company consolidated or merged with or into or which
merged into or with the Company or to which such conveyance, sale, transfer or
lease was made, as the case may be (a “Constituent Person”), or (B) an
Affiliate of a Constituent Person and (ii) failed to exercise his rights of
election, if any, as to the kind or amount of securities, cash and other property
receivable upon such consolidation, merger, conveyance, sale, transfer or lease
(provided that if the kind or amount of securities, cash and other property
receivable upon such consolidation, merger, conveyance, sale, transfer, or
lease is not the same for each share of Common Stock of the Company held
immediately prior to such consolidation, merger, conveyance, sale, transfer or
lease by others than a Constituent Person or an Affiliate thereof and in
respect of which such rights of election shall not have been exercised
(“Non-electing Share”), then for the purpose of this Section 12.11 the
kind and amount of securities, cash and other property receivable upon such
consolidation, merger, conveyance, sale, transfer or lease by the holders of
each Non-electing Share shall be deemed to be the kind and amount so receivable
per share by a plurality of the Non-electing Shares).  Such supplemental indenture shall provide for adjustments that,
for events subsequent to the effective date of such supplemental indenture,
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Article XII.  The above
provisions of this Section 12.11 shall similarly apply to successive
consolidations, mergers, conveyances, sales, transfers or leases.  Notice of the execution of such a
supplemental indenture shall be given by the Company to the Holder of each
Security as provided in Section 1.6 promptly upon such execution.


 


Neither the Trustee nor
any Conversion Agent shall be under any responsibility to determine the
correctness of any provisions contained in any such supplemental indenture
relating either to the kind or amount of shares of stock or other securities or
property or cash receivable by Holders of Securities upon the conversion of
their Securities after any such consolidation, merger, conveyance, transfer,
sale or lease or to any such adjustment, but may accept as conclusive evidence
of the correctness of any such provisions, and shall be protected in relying
upon, an Opinion of Counsel with respect thereto, which the Company shall cause
to be furnished to the Trustee upon request.


 


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SECTION 12.12     Rights
Issued in Respect of Common Stock.


 


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


 


(i)            are deemed to be
transferred with such shares of Common Stock,


 


(ii)           are not exercisable,
and


 


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


 


shall not be deemed
distributed for purposes of Section 12.4(1)(ii) until the occurrence of
the earliest Trigger Event.  In
addition, in the event of any distribution of rights or warrants, or any
Trigger Event with respect thereto, that shall have resulted in an adjustment
to the Conversion Rate under Section 12.4(1)(ii), (1) in the case of any
such rights or warrants that shall all have been redeemed or repurchased
without exercise by any holders thereof, the Conversion Rate shall be
readjusted upon such final redemption or repurchase to give effect to such
distribution or Trigger Event, as the case may be, as though it were a cash
distribution, equal to the per share redemption or repurchase price received by
a holder of Common Stock with respect to such rights or warrants (assuming such
holder had retained such rights or warrants), made to all holders of Common
Stock as of the date of such redemption or repurchase, and (2) in the case of
any such rights or warrants all of which shall have expired without exercise by
any holder thereof, the Conversion Price shall be readjusted as if such
issuance had not occurred.


 


SECTION 12.13     Responsibility
of Trustee for Conversion Provisions.


 


The Trustee, subject to
the provisions of Section 6.1, and any Conversion Agent shall not at any
time be under any duty or responsibility to any Holder of Securities to
determine whether any facts exist which may require any adjustment of the
Conversion Rate, or with respect to the nature or extent of any such adjustment
when made, or with respect to the method employed, herein or in any
supplemental indenture provided to be employed, in making the same, or whether
a supplemental indenture need be entered into. 
Neither the Trustee, subject to the provisions of Section 6.1, nor
any Conversion Agent shall be accountable with respect to the validity or value
(or the kind or amount) of any Common Stock, or of any other securities or
property or cash, which may at any time be issued or delivered upon the
conversion of any Security; and it or they do not make any representation with
respect thereto.  Neither the Trustee,
subject to the provisions of Section 6.1, nor any Conversion Agent shall
be responsible for any failure of the Company to make or calculate any cash
payment or to issue, transfer or deliver any shares of Common Stock or share
certificates or other securities or property or cash upon the surrender of any
Security for the purpose of conversion; and the Trustee, subject to the
provisions of Section 6.1, and any Conversion Agent shall not be
responsible for any failure of the Company to comply with any of the covenants
of the Company contained in this Article.


 


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ARTICLE XIII


 


REPURCHASE OF
SECURITIES AT THE OPTION OF THE HOLDER


 


SECTION 13.1       Right
to Require Repurchase upon a Designated Event.


 


In the event that a
Designated Event shall occur at any time prior to the maturity of the
Securities, then each Holder shall have the right, at the Holder’s option to
require the Company to repurchase, and upon the exercise of such right the
Company shall repurchase such Holder’s Securities, in whole or in part, that is
equal to U.S. $1,000 or any integral multiple of U.S. $1,000 in excess thereof
or the entire principal amount of the Securities held by any Holder (provided
that no single Security may be repurchased in part unless the portion of the
principal amount of such Security to be Outstanding after such repurchase is
equal to U.S. $1,000 or integral multiples of U.S. $1,000 in excess thereof),
on the date (the “Repurchase Date”) that is not less than 30 nor more than 45
Business Days after the date of the Company Notice (as defined in
Section 13.3) at a purchase price equal to 100% of the principal amount of
the Securities to be repurchased plus accrued and unpaid interest and
Additional Interest, if any, to, but excluding, the Repurchase Date (the
“Repurchase Price”); provided, however,
that installments of interest, if any, on Securities with an Interest Payment
Date is on or prior to the Repurchase Date shall be payable to the Holders of
such Securities, or one or more Predecessor Securities, registered as such on
the relevant Record Date according to their terms and the provisions of
Section 3.7.  If the Designated
Event is a Termination of Trading, the Repurchase Price will be paid in
cash.  If the Designated Event is a
Change in Control, the Company shall pay the Repurchase Price in accordance
with Sections 13.2 and 13.3 herein.


 


SECTION 13.2      Company’s Right To Elect
Manner Of Payment Of Repurchase Price Upon the Occurrence of a Change in
Control.


 


(1)           The Securities to be
repurchased by the Company on any Repurchase Date pursuant to Section 13.1
upon the occurrence of a Change in Control may be paid for, in whole or in
part, at the election of the Company, in cash or shares of Common Stock, or in
any combination of cash and shares of Common Stock, subject to the conditions
set forth in Section 13.2(5).  The
Company shall designate in its Company Notice whether the Company will purchase
the Securities for cash or shares of Common Stock, or, if a combination
thereof, the percentage of the Repurchase Price that it will pay in cash and
the percentage that it will pay in shares of Common Stock; provided that the
Company will pay cash for accrued and unpaid interest and for fractional
interests in shares of Common Stock in an amount based upon 95% of the Market
Price of such fractional shares. For purposes of determining the amount of any
fractional interests, all Securities subject to repurchase held by a Holder
shall be considered together (no matter how many separate certificates are to
be presented).


 


(2)           Each Holder whose
Securities are repurchased upon the occurrence of a Designated Event which
constitutes a Change in Control shall receive the same percentage of cash or
shares of Common Stock in payment of the Repurchase Price for such Securities
as any other Holder whose Securities are repurchased, except (i) as provided in
Section 13.2(1) with regard to the payment of cash in lieu of fractional
shares of Common Stock and (ii) in the event that the Company is unable to
purchase the Securities of a Holder or Holders for shares of


 


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Common Stock because any necessary qualifications or
registrations of the shares of Common Stock under applicable state securities
laws cannot be obtained, or because the conditions to purchasing the Securities
for shares of Common Stock set forth in Section 13.2(5) have not been
satisfied, the Company may purchase the Securities of such Holder or Holders
for cash.


 


(3)           At least three Business
Days before the date of any Company Notice, the Company shall deliver an
Officers’ Certificate to the Trustee specifying:


 


(i)            the manner of payment
selected by the Company;


 


(ii)           the information
required to be included in the Company Notice;


 


(iii)          if the Company elects to
pay the Repurchase Price, or a specified percentage thereof, in shares of
Common Stock, that the conditions to such manner of payment set forth in
Section 13.2(5) have been or will be complied with; and


 


(iv)          whether the Company
desires the Trustee to give the Company Notice required.


 


(4)           If the Company elects
to pay the Repurchase Price, or any percentage thereof, with respect to a
Repurchase Date in shares of Common Stock, the number of shares of Common Stock
to be delivered with respect to each $1,000 principal amount of Securities
shall be equal to the quotient obtained by dividing (i) the dollar amount of
the Repurchase Price (not including any accrued and unpaid interest) to be paid
in shares of Common Stock by (ii) 95% of the Market Price with respect to such
Repurchase Date, provided that no fractional shares will be delivered.


 


(5)           The Company’s right to
elect to pay some or all of the Repurchase Price with respect to a Repurchase
Date by delivering shares of Common Stock shall be conditioned upon:


 


(i)            the Company giving
timely notice of its election and not having previously given notice of an
election to pay the Repurchase Price with respect to such Repurchase Date
entirely in cash;


 


(ii)           the listing of such
shares of Common Stock on the principal United States securities exchange on
which the Common Stock is then listed or, if not so listed, on Nasdaq or any
similar U.S. system of automated dissemination of quotations of securities
prices;


 


(iii)          such shares of Common
Stock being eligible for immediate resale in the public market by
non-affiliates of the Company;


 


(iv)          information necessary to
calculated the Market Price being published in a daily newspaper of national
circulation or being otherwise readily publicly available;


 


(v)           the registration of
such shares of Common Stock under the Exchange Act, if required;


 


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(vi)          any necessary
qualification or registration under applicable state securities laws or the
availability of an exemption from such qualification and registration;


 


(vii)         the receipt by the
Trustee of an Officers’ Certificate stating that (A) the terms of the issuance
of the shares of Common Stock are in conformity with this Indenture, (B) the
shares of Common Stock to be issued by the Company in payment of the Repurchase
Price in respect of Securities have been duly authorized and, when issued and
delivered pursuant to the terms of this Indenture in payment of the Repurchase
Price, will be validly issued, fully paid and non-assessable and free from
preemptive rights and free of any lien or adverse claim, (C) each of the
conditions in clauses (i) through (vi) above has been satisfied and a Press
Release has been issued stating the actual number of shares of Common Stock to
be issued upon the payment of the Repurchase Price.  Such Officers’ Certificate shall also set forth the number of
shares of Common Stock to be issued for each $1,000 principal amount of
Securities and the Closing Price on each Trading Day during the period during
which the Market Price with respect to such Repurchase Date is to be
calculated; and


 


(viii)        the receipt by the Trustee
of an Opinion of Counsel stating that (A) the terms of the issuance of the
shares of Common Stock are in conformity with this Indenture, (B) the shares of
Common Stock to be issued by the Company in payment of the Repurchase Price in
respect of Securities have been duly authorized and, when issued and delivered
pursuant to the terms of this Indenture in payment of the Repurchase Price,
will be validly issued, fully paid and non-assessable and free from preemptive
rights under the Company’s Certificate of Incorporation and By-laws and the
Delaware General Corporation Law, and (C) 
the conditions in clauses (iii), (v) and (vi) above has been satisfied.


 


If the foregoing
conditions are not satisfied with respect to a Holder or Holders prior to the
close of business on the Repurchase Date, the Company shall pay the entire
Repurchase Price of the Securities of such Holder or Holders in cash.  The Company may not change its election with
respect to the consideration (or components or percentages of components
thereof) to be paid once the Company has given its Company Notice to Holders
except as set forth in the preceding sentence.


 


Upon determination of the
actual number of shares of Common Stock to be issued upon repurchase of
Securities, the Company shall be required to disseminate a Press Release
containing this information.


 


(6)           All shares of Common
Stock delivered upon purchase of the Securities shall be newly issued shares or
treasury shares, shall be duly authorized, validly issued, fully paid and
non-assessable, and shall be free from preemptive rights and free of any lien
or adverse claim.


 


(7)           If a Holder is paid
some or all of the Repurchase Price with respect to such Holder’s Securities in
shares of Common Stock, the Company shall pay any documentary, stamp or similar
issue or transfer tax due on such issue of Common Stock; provided that the
Holder shall pay any such tax which is due because the Holder requests the
Common Stock to be issued in a name other than that of the Holder.  The Paying Agent may refuse to deliver the
certificates representing the shares of Common Stock being issued in a name
other than the Holder’s name until the Paying Agent receives a sum sufficient
to pay any tax which will be due because the 


 


95

















 


shares of Common Stock are to be issued in a name
other than the Holder’s name. Nothing herein shall preclude any income tax
withholding required by law or regulations.


 


SECTION 13.3       Notices;
Method of Exercising Repurchase Right, Etc.


 


(1)           Unless the Company
shall have theretofore called for redemption all of the Outstanding Securities,
on or before the 20th day after the occurrence of a Designated Event, the
Company shall give to all Holders of Securities and to the Trustee, in the
manner provided in Section 1.6, notice (the “Company Notice”) of the
occurrence of the Designated Event and of the repurchase right set forth herein
arising as a result thereof and the Company shall issue a Press Release
including the information required to be included in such Company Notice
hereunder.


 


Each Company Notice shall
state:


 


(i)            the Repurchase Date,


 


(ii)           the date by which the
repurchase right must be exercised,


 


(iii)          whether the Designated
Event is a Termination of Trading or a Change in Control,


 


(iv)          the Repurchase Price,


 


(v)           if the Designated Event
is a Change in Control, whether the Company elects to pay the Repurchase Price
in cash, in shares of Common Stock or a combination thereof, specifying the
percentage amounts of each,


 


(vi)          if the Designated Event
is a Change in Control and the Company elects to pay all or a portion of the
Repurchase Price in shares of Common Stock, the method of calculating the
Market Price of such Common Stock,


 


(vii)         a description of the
procedure that a Holder must follow to exercise a repurchase right, and the
place or places where such Securities are to be surrendered for payment of the
Repurchase Price and accrued interest and Additional Interest, if any,


 


(viii)        that on the Repurchase
Date the Repurchase Price will become due and payable upon each such Security
designated by the Holder to be repurchased, and that interest thereon will
cease to accrue on and after such date,


 


(ix)           the Conversion Rate
then in effect, whether the conversion rights are then exercisable, the date on
which the right to convert the principal amount of the Securities to be
repurchased will terminate and the place or places where such Securities may be
surrendered for conversion, and


 


(x)            the place or places
that the Security certificate with the Election of Holder to Require Repurchase
as specified in Section 2.2 shall be delivered.


 


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


 


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


 


(2)           To exercise a
repurchase right, a Holder shall deliver to the Trustee on or before the date
specified in the Company Notice (i) written notice of the Holder’s exercise of
such right, which notice shall set forth the name of the Holder, the principal
amount of the Securities to be repurchased (and, if any Security is to
repurchased in part, the serial number thereof, the portion of the principal
amount thereof to be repurchased and the name of the Person in which the
portion thereof to remain Outstanding after such repurchase is to be
registered) and a statement that an election to exercise the repurchase right
is being made thereby (the “Repurchase Notice”), and (ii) the Securities with
respect to which the repurchase right is being exercised duly endorsed for
transfer.


 


(3)           A Holder may withdraw
any Repurchase Notice by delivering a written notice of withdrawal to the
Paying Agent prior to the close of business on the Repurchase Date (“Withdrawal
Notice”).  The Withdrawal Notice must
state:


 


(i)            the principal amount
of the withdrawn Securities;


 


(ii)           if certificated
Securities have been issued, the certificate number of the withdrawn Securities
(or, if the Securities are not certificated, the Withdrawal Notice must comply
with appropriate DTC procedures); and


 


(iii)          the principal amount, if
any, which remains subject to the Repurchase Notice.


 


(4)           Payment of the
Repurchase Price for a Security for which a Repurchase Notice has been
delivered and not withdrawn is conditioned upon book-entry transfer or delivery
of the Security, together with necessary endorsements, to the Paying Agent at
its corporate trust office in the Borough of Manhattan, The City of New York,
or any other office of the Paying Agent, at any time after delivery of the
Repurchase Notice.  Payment of the
Repurchase Price for the Security will be made promptly following the later of
the Repurchase Date and the time of book-entry transfer or delivery of the
Security.  If the Paying Agent holds
money and/or Common Stock sufficient to pay the Repurchase Price of the
Security on the Repurchase Date, then, on and after the business day following
the Repurchase Date:


 


(i)            the Security will
cease to be outstanding;


 


(ii)           interest will cease to
accrue in respect of any date from and after the Repurchase Date; and


 


(iii)          all other rights of the
Holder will terminate, other than the right to receive the Repurchase Price
upon delivery of the Security.


 


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This will be the case
whether or not book-entry transfer to the Security has been made or the
Security has been delivered to the Paying Agent.  Installments of interest that mature on or prior to the
Repurchase Date shall be payable in cash to the Holders of such Securities, or
one or more Predecessor Securities, registered as such at the close of business
on the relevant Regular Record Date.


 


(5)           If any Security (or
portion thereof) surrendered for repurchase shall not be so paid on the
Repurchase Date the principal amount of such Security (or portion thereof, as
the case may be) shall, until paid, bear interest to the extent permitted by
applicable law from the Repurchase Date at the rate of 4% per annum, and each
such Security shall remain convertible into Common Stock until the principal of
such Security (or portion thereof, as the case may be) shall have been paid or
duly provided for.


 


(6)           Any Security that is to
be repurchased only in part shall be surrendered to the Trustee (with, if the
Company or the Trustee so requires, due endorsement by, or a written instrument
of transfer in form satisfactory to the Company and the Trustee duly executed
by, the Holder thereof or his attorney duly authorized in writing), and the
Company shall execute, and the Trustee shall authenticate and make available
for delivery to the Holder of such Security without service charge, a new
Security or Securities, containing identical terms and conditions, each in an
authorized denomination in aggregate principal amount equal to and in exchange
for the unrepurchased portion of the principal of the Security so surrendered.


 


(7)           All Securities
delivered for repurchase shall be delivered to the Trustee to be canceled at
the direction of the Trustee, which shall dispose of the same as provided in
Section 3.9.


 


(8)           The Company will comply
with the Exchange Act and the rules and regulations promulgated under the
Exchange Act, to the extent applicable, in connection with the Company Notice.


 


SECTION 13.4       Certain
Definitions.


 


For purposes of the
foregoing sections of this Article XIII,


 


(1)           the term “beneficial
owner” shall be determined in accordance with Rule 13d-3, as in effect on the
date of the original execution of this Indenture, promulgated by the Commission
pursuant to the Exchange Act; provided that the Company and the Trustee may
rely on filings under Sections 13D and 13G under the Exchange Act for purposes
of this Article XIII;


 


(2)           a “Change in Control”
shall be deemed to have occurred at the time, after the original issuance of
the Securities, that any of the following occurs:


 


(i)            the acquisition by any
Person of beneficial ownership, directly or indirectly, through a purchase,
merger or other acquisition transaction or series of transactions, of shares of
capital stock of the Company entitling such person to exercise 50% or more of
the total voting power of all shares of capital stock of the Company entitled
to vote generally in the elections of directors, other than any such
acquisition by the Company, any Subsidiary of the Company or any employee
benefit plan of the Company; or


 


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(ii)           any consolidation of
the Company with, or merger of the Company into, any other Person, any merger
of another Person into the Company, or any conveyance, sale, transfer or lease
of all or substantially all of the assets of the Company to another Person,
other than:


 


(a)           any such transaction
pursuant to which the holders of 50% or more of the total voting power of all
shares of the Company’s capital stock entitled to vote generally in the
election of directors immediately prior to such transaction have the
entitlement to exercise, directly or indirectly, 50% or more of the total
voting power of all shares of capital stock entitled to vote generally in the
election of directors of the continuing or surviving corporation immediately
after such transaction; or


 


(b)           any such transaction
which is effected solely to change the jurisdiction of incorporation of the
Company.


 


(iii)          any transaction or event
(whether by means of an exchange offer, liquidation, tender offer,
consolidation, merger, binding share exchange, combination, reclassification,
recapitalization or otherwise) in connection with which all or substantially
all of the Common Stock is exchanged for, converted into, acquired for or
constitutes solely the right to receive, consideration which is not all or
substantially all common stock that:


 


(a)           is listed on, or
immediately after the transaction or event will be listed on, a United States
national securities exchange, or


 


(b)           is approved, or
immediately after the transaction or event will be approved, for quotation on
the Nasdaq National Market or any similar United States system of automated
dissemination of quotations of securities prices.


 


Provided,
however, that a Change in Control shall not be deemed to have
occurred if: (I) the Closing Sale Price of the Common Stock for any five
Trading Days within the period of 10 consecutive Trading Days ending
immediately after the later of the Change in Control and the public
announcement of the Change in Control (in the case of a Change in Control under
clause (i) above) or the period of 10 consecutive Trading Days ending
immediately before the Change in Control (in the case of a Change in Control
under clause (ii) or (iii) above) shall, in the case of each of such five
Trading Days, equal or exceed 105% of the Conversion Price of the Securities in
effect on each of such five Trading Days; or (II) all of the consideration
(excluding cash payments for fractional shares and cash payments made pursuant
to dissenters’ appraisal rights) in a merger or consolidation otherwise
constituting a Change in Control under clause (i) or (ii) above, consists of
shares of common stock, depositary receipts or other certificates representing
common equity interests traded on a national securities exchange or quoted on
the Nasdaq National Market (or will be so traded or quoted immediately
following such merger or consolidation) and as a result of such merger or
consolidation the notes become convertible solely into such common stock,
depositary receipts or other certificates representing common equity interests.


 


(3)           the term “Conversion
Price” shall equal U.S. $1,000 divided by the Conversion Rate (rounded to the
nearest U.S. $0.01); and


 


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(4)           for purposes of
Section 13.4(2)(i), the term “Person” shall include any syndicate or group
which would be deemed to be a “person” under Section 13(d)(3) of the
Exchange Act, as in effect on the date of the original execution of this
Indenture.


 


SECTION 13.5       Consolidation,
Merger, Etc..


 


In the case of any
merger, consolidation, conveyance, transfer or lease of all or substantially
all of the assets of the Company to which Section 12.11 applies, in which
the Common Stock of the Company is changed or exchanged as a result into the
right to receive shares of stock and other securities or property or assets
(including cash) which includes shares of common stock of another Person that
are, or upon issuance will be, traded on a United States national securities
exchange or approved for trading on an established automated over-the-counter
trading market in the United States, the Person formed by such consolidation or
resulting from such merger or combination or which acquires the properties or
assets (including cash) of the Company, as the case may be, shall execute and
deliver to the Trustee a supplemental indenture (which shall comply with the
Trust Indenture Act as in force at the date of execution of such supplemental
indenture) modifying the provisions of this Indenture relating to the right of
Holders to cause the Company to repurchase the Securities following a
Designated Event, including without limitation the applicable provisions of
this Article XIII and the definitions of the Common Stock and Designated
Event, as appropriate, and such other related definitions set forth herein as
determined in good faith by the Company (which determination shall be
conclusive and binding), to make such provisions apply in the event of a
subsequent Designated Event to the common stock and the issuer thereof if
different from the Company and Common Stock of the Company (in lieu of the
Company and the Common Stock of the Company).


 


SECTION 13.6       Repurchase
at the Option of the Holder on Specified Purchase Dates.


 


(a)           General.  At the option of the Holder, the Securities
shall be purchased by the Company on June 15, of each of 2011, 2014 and
2019 (each a “Purchase Date”), in whole or in part, at 100% of the principal
amount in cash, on the Purchase Date, of such Securities to be purchased,
together with accrued and unpaid interest and Additional Interest, if any, to,
but excluding, the Purchase Date (the “Purchase Price”) upon delivery to the
Paying Agent by the Holder, of a written notice of purchase (a “Purchase
Notice”) at any time from the opening of business on the date that is 20
Business Days prior to the Purchase Date until the close of business on the
Purchase Date.  The Purchase Notice
shall include the following information:


 


(1)           if certificated
Securities have been issued, the certificate number of the Securities that the
Holder will deliver to be purchased, or if no certificated Securities have been
issued, such information as may be required under the applicable procedures of
the Depositary and the Indenture;


 


(2)           the portion of the
principal amount of the Securities that the Holder will deliver to be
purchased, which portion must be $1,000 or an integral multiple thereof (or the
entire principal amount of the Securities held by such Holder); and


 


(3)           that such Securities
shall be purchased by the Company as of the Purchase Date pursuant to the terms
and conditions specified in the Securities and this Indenture;


 


100

















 


Delivery of such Security
to the Paying Agent prior to, on or after the Purchase Date (together with all
necessary endorsements) (at the offices of the Paying Agent in the case of
certificated Securities or otherwise by book-entry transfer) is a condition to
receipt by the Holder of the Purchase Price therefor; provided, however, that such Purchase
Price shall be so paid pursuant to this Section 13.6 only if the Security
so delivered to the Paying Agent shall conform in all respects to the
description thereof in the related Purchase Notice.


 


The Paying Agent shall
promptly notify the Company of the receipt by it of a Purchase Notice.


 


Any purchase by the
Company contemplated pursuant to the provisions of this Section 13.6 shall
be consummated by the delivery of the consideration from the Company to the
Paying Agent, to be received by the Holder promptly following the later of the
Purchase Date and the date of delivery of the Security.


 


If the Paying Agent holds
money or securities sufficient to pay the Purchase Price of the Securities on
the Business Day following the Purchase Date in accordance with the terms of
this Indenture, then, immediately after the Purchase Date, the Securities will
cease to be Outstanding whether or not the Securities have been delivered to
the Paying Agent and interest will cease to accrue in respect of any date from
and after the Purchase Date. 
Thereafter, all other rights of the Holders shall terminate, other than
the right to receive the Purchase Price upon delivery of the Securities.


 


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


 


(b)           Notice of Optional
Repurchase.  The Company is required
to give notice (the “Notice of Optional Repurchase”) to the Holders on a date
that is no less than 20 Business Days prior to the Purchase Date.  The Notice of Optional Repurchase shall be
mailed to all Holders at their respective addresses shown in the Register, and
shall include the following information:


 


(1)           the name and address of
the Paying Agent;


 


(2)           that the Purchase
Notice must be delivered by each Holder electing to have the Company repurchase
such Holder’s Securities (or a portion thereof) as of the Purchase Date, to the
Paying Agent (the Notice of Optional Repurchase shall include a form of
Purchase Notice), which Purchase Notice must be delivered prior to the close of
business on the Purchase Date;


 


(3)           that the Securities
must be surrendered (by physical delivery at the office of the Paying Agent in
the case of certificated Securities, or otherwise by book-entry transfer) to
the Paying Agent to collect payment;


 


(4)           that the Purchase Price
for any security as to which a Purchase Notice has been given and not withdrawn
will be paid promptly following the later of the Purchase Date and the date of
surrender of such Security;


 


(5)           a brief summary of the
conversion rights of the Securities;


 


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(6)           the procedures for
withdrawing a Purchase Notice and a sample form of Notice of Withdrawal; and


 


(7)           the CUSIP number or
numbers of the Securities being purchased.


 


At the Company’s request
(given to the Trustee not less than three Business Days prior to the required
mailing date, with the required form of notice), the Trustee shall give the
Notice of Optional Repurchase in the Company’s name and at the Company’s
expense; provided, however, that,
in all cases, the text of such Notice of Optional Repurchase shall be prepared
by the Company.


 


The Company will comply
with the Exchange Act and the rules and regulations promulgated under the
Exchange Act, to the extent applicable, in connection with the Notice of
Optional Repurchase.


 


(c)           Notice of Withdrawal.  Notwithstanding anything herein to the
contrary, any Holder delivering to the Paying Agent the Purchase Notice
contemplated by this Section 13.6 shall have the right to withdraw such
Purchase Notice at any time prior to the close of business on the Purchase Date
by delivery of a written notice of withdrawal (a “Notice of Withdrawal”) to the
Paying Agent.  The Notice of Withdrawal
shall indicate the following:


 


(1)           the principal amount of
Securities being withdrawn;


 


(2)           if certificated
Securities have been issued, the certificate numbers of the Securities being
withdrawn or if certificated Securities have not been issued, such information
as may be required under the applicable procedures of the Depositary and the
Indenture; and


 


(3)           the principal amount,
if any, that remains subject to the Purchase Notice.


 


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


 


ARTICLE XIV


 


HOLDERS LISTS AND
REPORTS BY TRUSTEE AND COMPANY


 


SECTION 14.1       Company
to Furnish Trustee Names and Addresses of Holders.


 


The Company will furnish
or cause to be furnished to the Trustee:


 


(1)           semi-annually, not more
than 15 days after the Regular Record Date, a list, in such form as the Trustee
may reasonably require, of the names and addresses of the Holders of Securities
as of such date as the Trustee may reasonably request, and


 


(2)           at such other times as
the Trustee may reasonably request in writing, within 30 days after the receipt
by the Company of any such request, a list of similar form and content as of a
date not more than 15 days prior to the time such list is furnished;


 


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provided,
however, that no such list need be furnished so long as the
Trustee is acting as Security Registrar.


 


SECTION 14.2       Preservation
of Information.


 


(1)           The Trustee shall
preserve, in as current a form as is reasonably practicable, the names and
addresses of Holders contained in the most recent list furnished to the Trustee
as provided in Section 14.1 and the names and addresses of Holders
received by the Trustee in its capacity as Security Registrar.  The Trustee may destroy any list, if any, furnished
to it as provided in Section 14.1 upon receipt of a new list so furnished.


 


(2)           After this Indenture
has been qualified under the Trust Indenture Act, the rights of Holders to
communicate with other Holders with respect to their rights under this Indenture
or under the Securities, and the corresponding rights, and duties of the
Trustee, shall be as provided by the Trust Indenture Act.


 


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


 


SECTION 14.3       Reports
by Trustee.


 


(1)           After this Indenture
has been qualified under the Trust Indenture Act, the Trustee shall transmit to
Holders such reports concerning the Trustee and its actions under this
Indenture as may be required pursuant to the Trust Indenture Act at the times
and in the manner provided pursuant thereto.


 


(2)           After this Indenture
has been qualified under the Trust Indenture Act, a copy of each such report
shall, at the time of such transmission to Holders, be filed by the Trustee
with each stock exchange upon which the Securities are listed, with the
Commission and with the Company.  The
Company will notify the Trustee when the Securities are listed on any stock
exchange.


 


SECTION 14.4       Reports
by Company.


 


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


 


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ARTICLE XV


 


IMMUNITY OF
INCORPORATORS, STOCKHOLDERS, 

OFFICERS AND DIRECTORS


 


SECTION 15.1       Indenture
and Securities Solely Corporate Obligations.


 


No recourse for the payment
of the principal of, or interest and Additional Interest, if any, on any
Security and no recourse under or upon any obligation, covenant or agreement of
the Company in this Indenture or in any supplemental indenture or in any
Security, or because of the creation of any indebtedness represented thereby,
shall be had against any incorporator, stockholder, employee, agent, officer,
or director or subsidiary, 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;
it being expressly understood that all such liability is hereby waived and
released as a condition of, and as a consideration for, the execution of this
Indenture and the issue of the Securities.


 


ARTICLE XVI


 


SUBORDINATION OF
SECURITIES


 


SECTION 16.1       Agreement
To Subordinate.


 


The Company agrees, and
each Holder by accepting any Security agrees, that the Indebtedness evidenced
by the Securities is subordinated in right of payment, to the extent and in the
manner provided in this Article XVI, to the payment when due of all
Schering Indebtedness of the Company and that such subordination is for the
benefit of and enforceable by the holders of Schering Indebtedness.  The Securities shall in all respects rank pari passu with
all other Senior Indebtedness of the Company (other than the Schering
Indebtedness), and only the Schering Indebtedness of the Company will rank
senior to the Securities in accordance with the provisions set forth
herein.  All provisions of this
Article XVI shall be subject to Section 16.12.


 


SECTION 16.2       Liquidation, Dissolution, Bankruptcy.


 


Upon any payment or
distribution of the assets of the Company upon a total or partial liquidation
or dissolution or reorganization or bankruptcy of or similar proceeding
relating to the Company or its property:


 


(1)           holders of Schering
Indebtedness of the Company shall be entitled to receive payment in full in
cash or cash equivalents of all Schering Indebtedness of the Company before
holders of Securities shall be entitled to receive any payment of principal of
or interest on or other amounts with respect to the Securities from the
Company; and


 


(2)           until the Schering
Indebtedness of the Company is paid in full, in cash or cash equivalents, any
payment or distribution to which Holders would be entitled but for the


 


104

















 


provisions of this Article XVI shall be made to
holders of Schering Indebtedness as their interests may appear,


 


provided,
that the restrictions of this Section 16.2 shall not apply to the
distribution of shares of Common 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 XVI with
respect to the Securities to the payment of Schering Indebtedness which may at
the time be outstanding.


 


SECTION 16.3       Default on Schering Indebtedness.


 


Except for payments or
distributions made by the Trustee as permitted by Section 16.9 and 16.12
herein, no payments shall be made with respect to the principal of or interest
on, and other obligations with respect to, the Securities or repurchase, redeem
or otherwise retire any Securities (collectively, “pay the Securities”)
if (i) any Schering Indebtedness is not paid when due or (ii) any
other default on Schering Indebtedness occurs and the maturity of such Schering
Indebtedness is accelerated in accordance with its terms (clauses (i) and (ii)
collectively, a “Payment Default”) (and, in either case, as applicable
to the Trustee, the Trustee has received written notice from the Representative
of the Schering Indebtedness that a Payment Default exists and that the Company
may not pay the Securities, as defined herein, which notice has not been
rescinded or revoked by the Representative) unless, in either case,
(x) the default has been cured or waived or is no longer continuing and/or
any such acceleration has been rescinded or (y) such Schering Indebtedness
has been paid in full; provided, however, that the Company may
pay the Securities, subject to the provisions of Section 16.2, without
regard to the foregoing if the Company and the Trustee receive written notice
approving such payment from the Representatives of the Schering Indebtedness
notwithstanding the occurrence or continuance of a Payment Default.  During the continuance of any default (other
than a Payment Default) with respect to the Schering Indebtedness pursuant to
which the maturity thereof may be accelerated immediately (i) without further
notice (except such notice as may be required to effect such acceleration), and
(ii) without the further passage of any applicable grace periods (a
“Non-Payment Default”), the Company may not pay the Securities for a period (a
“Payment
Blockage Period”) commencing upon the receipt by the Trustee
(with a copy to the Company) of written notice (a “Blockage Notice”) of
such default from the Representative of the holders of the Schering
Indebtedness specifying an election to effect a Payment Blockage Period and
ending 179 days thereafter (or earlier if such Payment Blockage Period is
terminated (i) by written notice to the Trustee and the Company from the
Representative who gave such Blockage Notice, (ii) because the default
giving rise to such Blockage Notice has been cured, waived or is no longer
continuing or (iii) because the Schering Indebtedness has been repaid in
full).  Not more than one Blockage
Notice may be given, and not more than one Payment Blockage Period may occur,
in any consecutive 360-day period, irrespective of the number of defaults with
respect to the Schering Indebtedness during such period.  No Non-Payment Default that existed or was
continuing on the date of delivery of any Blockage Notice to the Trustee shall
be, or be made, the basis for a subsequent Blockage Notice unless such default
shall have been cured or waived for a period of not less than 90 consecutive
days.


 


105

















 


The Company may and shall
resume payments on and distributions in respect of the Securities (including,
but not limited to, the Redemption Price with respect to the Securities to be
redeemed):


 


(1)           in the case of a
Payment Default, the date upon which any such Payment Default is cured or
waived or ceases to exist, or


 


(2)           in the case of a
Non-Payment Default, the earlier of (a) the date upon which such default is
cured or waived or ceases to exist or (b) 179 days after the applicable
Blockage Notice is received by the Trustee if the maturity of the Schering
Indebtedness has not been accelerated and there is no Payment Default, unless
this Article XVI otherwise prohibits the payment or distribution at the
time of such payment or distribution. 
In the case of any of the foregoing, the Trustee shall be entitled (but
not obligated) to request and receive, and conclusively rely upon, an Officer’s
Certificate of the Company or a certificate from the Representative of the
Schering Indebtedness, as to the fact of the cure, waiver or non-existence of
any such default, acceleration or Payment Default, as the case may be.


 


No subsequent Payment
Blockage Period shall commence until all payments on and distributions in
respect of the Securities which were blocked during any prior Payment Blockage
Period have been paid or distributed to the Holders.


 


Nothing herein shall be
deemed to prohibit the holders of the Schering Indebtedness from accelerating
the Schering Indebtedness during the Blockage Period in accordance with the
terms of the Schering Loan Agreement.


 


SECTION 16.4       Acceleration of Payment of Securities.


 


If payment of the
Securities is accelerated because of an Event of Default, the Company and the
Trustee shall promptly notify the Representative of the Schering Indebtedness
which is then outstanding (provided, however, that the Trustee shall have no
liability for any delay in giving or failure to give such notice).  If a notice is required pursuant to the
immediately preceding sentence, neither the Company nor the Trustee may pay the
Securities until seven Business Days after the Representative of the Schering
Indebtedness receives notice of such acceleration and thereafter may pay the
Securities only if the provisions of this Article XVI otherwise permit
payment at that time.


 


Notice given by the
Trustee pursuant to this Section 16.4 shall be effective if given in
writing (including by telecopy), and shall be deemed to have been duly given or
made upon the earlier of delivery by hand, or three Business Days after
delivery by the Trustee to a nationally recognized overnight courier service
(against a signed receipt) or, in the case of telecopy notice, when sent and
confirmed as received, addressed to the Representative at: Schering  Aktiengesellschaft, 13342 Berlin, Germany,
Attention: Finance Department; with a copy to: Schering  Aktiengesellschaft, 13342 Berlin, Germany,
Attention: Legal Department, or at any other address previously furnished in writing
to the Trustee by the Representative.


 


106

















 


SECTION 16.5       When Distribution Must Be Paid Over.


 


In the event that any
payment on account of principal or interest and Additional Interest, if any, on
the Securities shall be made in violation of this Article XVI by or on
behalf of the Company and received by the Trustee, by any Holder or by any
Paying Agent, such payment (subject, in each case, to the provisions of
Section 16.9 hereof) shall be held in trust for the benefit of, and shall
be immediately paid over to, the holders of the Schering Indebtedness as their
interests may appear; provided, however,
that the liabilities and obligations of the Trustee under this Article XVI
(including this Section 16.5) are limited by Section 16.9,
Section 16.13 and Section 16.15.


 


SECTION 16.6       Subrogation.


 


Subject to the payment in
full of the Schering Indebtedness, until the Securities are paid in full,
Holders shall be subrogated to the rights of holders of the Schering
Indebtedness to receive distributions applicable to the Schering Indebtedness
to the extent of payments or distributions, otherwise payable to the Holders,
that have been made to the holders of the Schering Indebtedness pursuant to
this Article XVI.  A distribution
made under this Article XVI to holders of the Schering Indebtedness which
otherwise would have been made to Holders is not, as between the Company and
the Holders, a payment by the Company of the Schering Indebtedness.


 


SECTION 16.7       Relative Rights.


 


This Article XVI
defines the relative rights of Holders of the Securities on the one hand and
holders of the Schering Indebtedness on the other hand.  Nothing in this Indenture shall:


 


(1)           impair, as between the
Company and the Holders, the obligation of the Company, which is absolute and
unconditional, to pay principal of and interest on the Securities in accordance
with their terms;


 


(2)           prevent the Trustee or
any Holder from exercising its available remedies upon a Default or Event of
Default, subject to the rights of holders of the Schering Indebtedness to
receive distributions otherwise payable to Holders, including any distributions
from the proceeds of any settlements or judgments resulting from the exercise
of such remedies; or


 


(3)           impair the rights and
remedies of Schering, or the obligations of the Company, under the Schering
Loan Agreement.


 


SECTION 16.8       Subordination May Not Be Impaired by Company.


 


No right of any holder of
the Schering Indebtedness to enforce the subordination of the Indebtedness
evidenced by the Securities shall be impaired by any act or failure to act by
the Company or by the failure of the Company to comply with this Indenture.


 


107

















 


SECTION 16.9       Notice to Trustee.


 


The Company shall give
prompt written notice in the form of an Officers’ Certificate to a Responsible
Officer of the Trustee and to any paying agent of any fact known to the Company
that 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 XVI.  Notwithstanding
the provisions of this Article XVI or any other provision of this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts that 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 XVI, unless and until a Responsible 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 the Schering Indebtedness, and before the receipt of any
such written notice, the Trustee, subject to the provisions of
Section 6.1, shall be entitled in all respects to assume that no such
facts exist.  If not less than two
Business Days 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 16.9, then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to apply
monies received to the purpose for which they were received, and shall not be
affected by any notice to the contrary that may be received by it on or after
such prior date.


 


Nothing in this
Article XVI shall apply to claims of, or payments to, the Trustee under or
pursuant to Section 6.7.


 


SECTION 16.10     Distribution or Notice to Representative.


 


Whenever a distribution
is to be made or a notice given to holders of the Schering Indebtedness, the
distribution may be made and the notice given to their Representative (if any).


 


SECTION 16.11     Article Sixteen Not To Prevent Events
of Default or Limit Right To Accelerate.


 


The failure to make a
payment in respect of the Securities by reason of any provision in this Article XVI
shall not be construed as preventing the occurrence of a Default or Event of
Default.  Nothing in this
Article XVI shall have any effect on the right of the Holders or the
Trustee to accelerate the maturity of the Securities.


 


SECTION 16.12     Trust Moneys Not Subordinated.


 


Notwithstanding anything
contained herein to the contrary, payments from money held in trust by the
Trustee for the payment of principal of and interest on the Securities in
accordance with Article IV hereof shall not be subordinated to the prior
payment of the Schering Indebtedness or subject to the restrictions set forth
in this Article XVI, and none of the Holders shall be obligated to pay
over any such amount to the Company, any holder of the Schering Indebtedness,
or any other creditor of the Company.


 


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SECTION 16.13     Trustee Entitled To Rely.


 


Upon any payment or
distribution pursuant to this Article XVI, the Trustee and the Holders
shall be entitled to rely (i) upon any order or decree of a court of
competent jurisdiction in which any proceedings of the nature referred to in
Section 16.2 are pending, (ii) upon a certificate of the liquidating
trustee or agent or other Person making such payment or distribution to the Trustee
or to the Holders or (iii) upon the Representatives for the holders of the
Schering Indebtedness for the purpose of ascertaining the Persons entitled to
participate in such payment or distribution, the holders of the Schering
Indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to this Article XVI.  In the event
that the Trustee determines, in good faith, that evidence is required with
respect to the right of any Person as a holder of the Schering Indebtedness to
participate in any payment or distribution pursuant to this Article XVI,
the Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of the Schering Indebtedness held
by such Person, the extent to which such Person is entitled to participate in
such payment or distribution and other facts pertinent to the rights of such Person
under this Article XVI, 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.  The Trustee shall have the right to seek a declaratory judgment
as to any right of such Person to receive such payment.  The provisions of Sections 6.1 and 6.3 shall
be applicable to all actions or omissions of actions by the Trustee pursuant to
this Article XVI.


 


SECTION 16.14     Trustee To Effectuate Subordination.


 


Each Holder by accepting
a Security authorizes and directs the Trustee on his behalf to take such action
as may be necessary or appropriate to acknowledge or effectuate the
subordination between the Holder and the holders of the Schering Indebtedness
as provided in this Article XVI and appoints the Trustee as attorney-in-fact
for any and all such purposes.


 


SECTION 16.15     Trustee Not Fiduciary for Holders of the
Schering Indebtedness.


 


With respect to the
holders of Schering Indebtedness, the Trustee undertakes to perform or to
observe only such of its covenants and obligations as are specifically set
forth in this Article XVI, and no implied covenants or obligations with
respect to the holders of the Schering Indebtedness shall be read into this
Article XVI against the Trustee. 
The Trustee shall not be deemed to owe any fiduciary duty to the holders
of the Schering Indebtedness and shall not be liable to any such holders if it
shall mistakenly (absent willful misconduct) pay over or distribute to Holders
or the Company, or any other Person, money or assets to which any holders of
the Schering Indebtedness shall be entitled by virtue of this Article XVI
or otherwise.


 


SECTION 16.16     Reliance by Holders of the Schering
Indebtedness on Subordination Provisions.


 


Each Holder by accepting
a Security acknowledges and agrees that the foregoing subordination provisions
are, and are intended to be, an inducement and a consideration to each holder
of the Schering Indebtedness, whether the Schering Indebtedness was created or
acquired


 


109

















 


before or after
the issuance of the Securities, to acquire and continue to hold, or to continue
to hold, the Schering Indebtedness and such holder of the Schering Indebtedness
shall be deemed conclusively to have relied on such subordination provisions in
acquiring and continuing to hold, or in continuing to hold, the Schering
Indebtedness.


 


SECTION 16.17     Certain
Conversions Not Deemed Payment.


 


For the purposes of this
Article XVI only, (1) the issuance and delivery of Junior Securities upon
conversion of the Securities in accordance with Article XII and (2) the
payment, issuance or delivery of cash, property or securities as a result of
any transaction specified in Section 12.11 shall not be deemed to
constitute a payment or distribution on account of the principal of or interest
on the Securities or on account of the purchase or other acquisition of the
Securities (or otherwise to “pay the Securities” as defined in
Section 16.3). For the purposes of this Section 16.17, the term “Junior Securities” means (a) Common Stock
of the Company or (b) securities of the Company that are subordinated in right
of payment to the Schering Indebtedness that 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 XVI.  Nothing
contained in this Article XVI or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as among the Company, its creditors
and the Holders of the Securities, the right, which is absolute and
unconditional, of the Holder of any Security to convert such Security in
accordance with Article XII.


 


110

















 


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


 


	
   

  	
  EPIX MEDICAL, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Peyton J. Marshall

  
	
   

  	
  Name:  Peyton J. Marshall

  
	
   

  	
  Title:    CFO

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  U.S. BANK NATIONAL
  ASSOCIATION,

  as Trustee

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Chi Ma

  
	
   

  	
  Name:  Chi Ma

  
	
   

  	
  Title:    Vice President

  



 

















 


 


ANNEX A — Form of
Unrestricted Securities Certificate


 


UNRESTRICTED SECURITIES
CERTIFICATE


 


(For removal of
Restricted Securities Legend pursuant to Section 3.5(3))


 


U.S. BANK NATIONAL ASSOCIATION


                                                                    


                                                                    


 


Attention:  Corporate Trust Services


 


RE:  3% CONVERTIBLE SENIOR NOTES DUE
JUNE 15, 2024, OF EPIX MEDICAL, INC. (THE “SECURITIES”)


 


Reference is made to the
Indenture, dated as of June 7, 2004 (the “Indenture”), from EPIX MEDICAL,
INC. (the “Company”) to U.S. BANK NATIONAL ASSOCIATION, as Trustee.  Terms used herein and defined in the Indenture
or in Rule 144 under the U.S. Securities Act of 1933 (the “Securities Act”) are
used herein as so defined.


 


This certificate relates
to U.S.$
                             principal
amount of Securities, which are evidenced by the following certificate(s) (the
“Specified Securities”):


 


CUSIP No.                           


 


CERTIFICATE No(s).                                  


 


The person in whose name
this certificate is executed below (the “Undersigned”) hereby certifies that
either (i) it is the sole beneficial owner of the Specified Securities or (ii)
it is acting on behalf of all the beneficial owners of the Specified Securities
and is duly authorized by them to do so. 
Such beneficial owner or owners are referred to herein collectively as
the “Owner”.  If the Specified Securities
are represented by a Global Security, they are held through the Depositary or
an Agent Member in the name of the Undersigned, as or on behalf of the
Owner.  If the Specified Securities are
not represented by a Global Security, they are registered in the name of the
Undersigned, as or on behalf of the Owner.


 


The Owner has requested
that the Specified Securities be exchanged for Securities bearing no Restricted
Securities Legend pursuant to Section 3.5(3) of the Indenture.  In connection with such exchange, the Owner
hereby certifies that the exchange is occurring after a period of at least two
years has elapsed since the date the Specified Securities were acquired from
the Company or from an “affiliate” (as such term is defined in Rule 144) of the
Company, whichever is later, and the Owner is not, and during the preceding
three months has not been, an affiliate of the Company.  The Owner also acknowledges that any future
transfers of the Specified Securities must comply with all applicable
securities laws of the states of the United States and other jurisdictions.


 

















 


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


 


	
  Dated:

  	
   

  	
   

  



 


(Print the name of the
Undersigned, as such term is defined in the second paragraph of this
certificate.)


 


 


	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  



 


 


(If the Undersigned is a
corporation, partnership or fiduciary, the title of the person signing on
behalf of the Undersigned must be stated.)


 


2

















 


ANNEX B — Form of
Surrender Certificate


 


In connection with the
certification relating to compliance with certain restrictions relating to
transfers of Restricted Securities, such certification shall be provided
substantially in the form of the following certificate, with only such changes
thereto as shall be approved by the Company and SG Cowen & Co., LLC:


 


CERTIFICATE


 


EPIX MEDICAL, INC.


 


3% CONVERTIBLE SENIOR
NOTES DUE JUNE 15, 2024


 


This is to certify that
as of the date hereof with respect to U.S. $                 principal
amount of the above-captioned securities surrendered on the date hereof (the
“Surrendered Securities”) for registration of transfer, or for conversion or
repurchase where the securities issuable upon such conversion or repurchase are
to be registered in a name other than that of the undersigned Holder (each such
transaction being a “transfer”), the undersigned Holder (as defined in the
Indenture) certifies that the transfer of Surrendered Securities associated
with such transfer complies with the restrictive legend set forth on the face
of the Surrendered Securities for the reason checked below: 


 


	
  o

  	
   

  	
  The transfer of the
  Surrendered Securities complies with Rule 144A under the Securities Act; or

  
	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  The transfer of the
  Surrendered Securities complies with Rule 144 under the United States
  Securities Act of 1933, as amended (the “Securities Act”); or

  
	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  The transfer of the
  Surrendered Securities has been made to an institution that is an “accredited
  investor” within the meaning of Rule 501(a)(1), (2), or (7) under the
  Securities Act who purchases at least $100,000 principal amount in a
  transaction exempt from the registration requirements of the Securities Act
  and a signed letter containing certain representations and agreements
  relating to restrictions on transfer of the Securities (and an opinion of
  counsel acceptable to the Company if requested by the Company, that such
  transfer is exempt from registration); or

  
	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  The transfer of the Surrendered Securities has been
  made pursuant to an exemption from registration under the Securities Act and
  an opinion of counsel has been delivered to the Company with respect to such
  transfer.

  



 


 


[Name of Holder]


 


	
  Dated:

  	
   

  	
   

  



 












	
  *To be dated the date
  of surrender