CONVERSION PRICE; PROVIDED THAT FOR PURPOSES OF AN
INTEREST CONVERSION PURSUANT TO SECTION 8, THE CONVERSION PRICE SHALL MEAN 93%
OF THE WEIGHTED AVERAGE PRICE OF THE COMMON STOCK ON EACH OF THE FIVE
(5) TRADING DAYS ENDING ON THE TRADING DAY IMMEDIATELY PRECEDING THE INTEREST
CONVERSION DATE APPLICABLE TO ANY SUCH INTEREST CONVERSION FOR WHICH SUCH
DETERMINATION IS BEING MADE.
"CONVERTIBLE SECURITIES" MEANS ANY STOCK OR SECURITIES (OTHER THAN OPTIONS)
DIRECTLY OR INDIRECTLY CONVERTIBLE INTO OR EXCHANGEABLE OR EXERCISABLE FOR
SHARES.
"DEFAULT" MEANS ANY EVENT OR CIRCUMSTANCE THAT IS, OR WITH THE GIVING OF NOTICE
OR LAPSE OF TIME OR BOTH, WOULD BE AN EVENT OF DEFAULT.
"DOLLARS" OR "$" MEANS UNITED STATES DOLLARS.
4
"EUROSILICONE AGREEMENT" MEANS THAT CERTAIN AGREEMENT FOR THE SALE AND PURCHASE
OF THE SHARES OF LABORATORIES EUROSILICONE SA, DATED MAY 17, 2004, BY AND AMONG
THE COMPANY AND THE SELLERS NAMED THEREIN, WHICH AGREEMENT HAS NOT BEEN AMENDED,
SUPPLEMENTED OR OTHERWISE MODIFIED SINCE SUCH DATE.
"EXCLUDED TAXES" MEANS, WITH RESPECT TO THE HOLDER, OR ANY OTHER RECIPIENT OF
PAYMENT TO BE MADE BY OR ON ACCOUNT OF ANY OBLIGATIONS OF THE COMPANY OR ANY OF
ITS SUBSIDIARIES UNDER THE NOTES, THE SECURITIES PURCHASE AGREEMENT OR UNDER ANY
OTHER TRANSACTION DOCUMENT, (A) INCOME OR FRANCHISE TAXES IMPOSED ON (OR
MEASURED BY) ITS NET INCOME BY THE UNITED STATES OF AMERICA OR ANY OTHER
JURISDICTION UNDER THE LAWS OF WHICH SUCH RECIPIENT IS ORGANIZED, ITS PRINCIPAL
OFFICES ARE LOCATED, IT IS RESIDENT FOR TAX PURPOSES OR TO WHICH IT HAS A
CONNECTION GIVING RISE TO SUCH TAXES OTHER THAN BY REASON OF THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT, INCLUDING THE HOLDING OF THE NOTES, AND
ENFORCING ITS RIGHTS THEREUNDER (B) ANY BRANCH PROFITS TAXES IMPOSED BY THE
UNITED STATES OF AMERICA OR ANY SIMILAR TAX IMPOSED BY ANY OTHER JURISDICTION IN
WHICH THE HOLDER OR RECIPIENT IS TREATED AS DOING BUSINESS, (C) ANY TAXES
IMPOSED BY REASON OF A HOLDER OR RECIPIENT FAILING TO PROVIDE FORMS OR
CERTIFICATIONS IT IS LEGALLY ABLE TO PROVIDE THAT WOULD REDUCE OR ELIMINATE SUCH
TAXES AND THAT ARE REASONABLY REQUESTED BY THE COMPANY.
"EXEMPTED ISSUANCES" MEANS (A) SHARES ISSUED OR DEEMED TO HAVE BEEN ISSUED BY
THE COMPANY PURSUANT TO AN APPROVED STOCK PLAN; (B) SHARES ISSUED OR DEEMED TO
HAVE BEEN ISSUED UPON THE CONVERSION, EXCHANGE OR EXERCISE OF ANY OPTION OR
CONVERTIBLE SECURITY OUTSTANDING ON THE DATE PRIOR TO THE ISSUANCE DATE AND SET
FORTH IN SCHEDULE 3(C) TO THE SECURITIES PURCHASE AGREEMENT, PROVIDED THAT THE
TERMS OF SUCH OPTION OR CONVERTIBLE SECURITY ARE NOT AMENDED OR OTHERWISE
MODIFIED ON OR AFTER THE DATE OF THE SECURITIES PURCHASE AGREEMENT, AND PROVIDED
THAT THE CONVERSION PRICE, EXCHANGE PRICE, EXERCISE PRICE OR OTHER PURCHASE
PRICE IS NOT REDUCED, ADJUSTED OR OTHERWISE MODIFIED AND THE NUMBER OF SHARES
ISSUED OR ISSUABLE IS NOT INCREASED (WHETHER BY OPERATION OF, OR IN ACCORDANCE
WITH, THE RELEVANT GOVERNING DOCUMENTS OR OTHERWISE) ON OR AFTER THE DATE OF THE
SECURITIES PURCHASE AGREEMENT; AND (C)