Document:

Development, License and Commercialization Agreement

 Exhibit 10.1 
  
 Redacted portions are indicated by [****]. 
  
  
 DEVELOPMENT, LICENSE AND COMMERCIALIZATION
AGREEMENT 
  
 Dated May 13, 2005 
  
 By and Between 
  
 BioMarin Pharmaceutical Inc. 
  
 And 
  
 Ares Trading S.A., 

 Table of Contents 
  

			
	 1.        DEFINITIONS
	  	1
	 2.        DEVELOPMENT COLLABORATION
	  	11
	 2.1        Development Plans
	  	11
	 2.2        Payment for Development Activities
	  	11
	 2.3        Opt-Out Option
	  	12
	 2.4        Independent Development.
	  	12
	 2.5        Cost Reports.
	  	13
	 2.6        Opt-In Rights.
	  	14
	 3.        DEVELOPMENT OF LICENSED PRODUCTS
	  	14
	 3.1        Development Governance.
	  	14
	 3.2        Steering Committee.
	  	15
	 3.3        Development Team and Development Team Leaders Roles and Responsibilities
	  	17
	 3.4        Commercial Team
	  	18
	 3.5        Removal of Members of Steering Committee, Development Team and Commercial
Team
	  	19
	 3.6        Efforts and Standards
	  	19
	 3.7        Development Outside of Development Plan for Phenoptin in PKU
	  	19
	 3.8        Books and Records
	  	19
	 3.9        Regulatory Obligations and Approvals.
	  	20
	 3.10      Regulatory Meetings and Communication
	  	20
	 3.11      Compliance with Law and Safety Reporting
	  	21
	 4.        INTELLECTUAL PROPERTY; LICENSES
	  	21
	 4.1        Ownership of Intellectual Properties
	  	21
	 4.2        Development Project License
	  	21
	 4.3        License to Serono in the Territory
	  	21
	 4.4        Sublicenses as to Licensed Products
	  	22
	 4.5        License to BioMarin Outside the Territory
	  	22
	 4.6        Sublicensees
	  	22
	 4.7        Patent Marking; Designations
	  	23
	 4.8        Trademarks
	  	23
	 4.9        Technology Transfer
	  	23
	 5.        SUPPLY OF LICENSED PRODUCT
	  	23
	 5.1        Supply of Licensed Product
	  	23
	 5.2        Forecasts the filing of the MAA for such Licensed Product.
	  	24
	 5.3        Purchase Orders.
	  	24
	 5.4        Supply Price and Standard Supply Price
	  	25
	 5.5        Manufacture
	  	25
	 5.6        Compliance with Forecasts; Shipping Dates
	  	26
	 5.7        Technology Transfer
	  	26
	 5.8        Delivery of Supplied Product
	  	27
	 5.9        Shelf Life
	  	27
	 5.10      Safety Stock
	  	27
	 5.11      Payment Procedures
	  	27
	 5.12      Documentation Associated with Shipments
	  	28
	 5.13      Direct Shipment to Customers
	  	28
	 5.14      Risk of Loss
	  	28
	 5.15      Rejection
	  	28

  

 i 

			
	 5.16      Supply in Excess of Forecast
	  	29
	 5.17      Suppliers
	  	29
	 5.18      Quality Agreement
	  	30
	 5.19      Audit
	  	30
	 6.        DISTRIBUTION OF LICENSED PRODUCT
	  	30
	 6.1        Marketing and Distribution of Licensed Product
	  	30
	 6.2        Post-Marketing Clinical Studies and Surveillance
	  	30
	 6.3        Regulatory Diligence, Compliance with Laws
	  	30
	 6.4        Commercial Diligence
	  	31
	 6.5        Changes to Licensed Products
	  	31
	 6.6        Complaints
	  	31
	 6.7        Recalls
	  	32
	 7.        FINANCIAL TERMS
	  	32
	 7.1        License Fee
	  	32
	 7.2        Milestone Payments
	  	32
	 7.3        Royalties
	  	32
	 8.           RECORDS, REPORTING, PAYMENT AND AUDITS
	  	34
	 8.1        Form of Payment; Currency Conversion
	  	34
	 8.2        Late Payment
	  	34
	 8.3        Records of Development Costs and Derivation of Royalties
	  	35
	 8.4        Audits
	  	35
	 8.5        Taxes
	  	35
	 9.        PATENT AND TRADEMARK PROSECUTION AND ENFORCEMENT
	  	35
	 9.1        Disclosure by Employees, Agents or Contractors
	  	35
	 9.2        Patent Committee
	  	36
	 9.3        Patent Prosecution and Related Activities
	  	36
	 9.4        Election Not to Prosecute
	  	37
	 9.5        Permitted Disclosures
	  	37
	 9.6        Third Party Infringement
	  	38
	 9.7        Third Party Actions Claiming Infringement
	  	39
	 10.      TERM AND TERMINATION
	  	40
	 10.1      Term
	  	40
	 10.2      Rights of Termination
	  	40
	 10.3      Termination For Cause
	  	41
	 10.4      Effect of Termination
	  	41
	 10.5      Accrued Rights
	  	41
	 10.6      Sublicensees
	  	42
	 10.7      Survival
	  	42
	 11.      REPRESENTATIONS AND WARRANTIES
	  	42
	 11.1      Representations, Warranties and Covenants of Serono
	  	42
	 11.2      Representations, Warranties and Covenants of BioMarin
	  	43
	 11.3      Disclaimer
	  	45
	 11.4      Limited Liability
	  	45
	 12.      INDEMNIFICATION; INSURANCE
	  	45
	 12.1      Serono Indemnification
	  	45
	 12.2      BioMarin Indemnification
	  	46
	 12.3      Indemnification Procedures
	  	46
	 12.4      Insurance
	  	47
	 13.      CONFIDENTIALITY
	  	47
	 13.1      Confidentiality
	  	47
	 13.2      Authorized Disclosure
	  	48

  

 ii 

			
	 13.3      Employees; Agents
	  	48
	 13.4      Injunctive Relief
	  	48
	 14.      MISCELLANEOUS
	  	49
	 14.1      Entire Agreement
	  	49
	 14.2      Controlling Law; Venue
	  	49
	 14.3      Notices
	  	49
	 14.4      Publicity
	  	50
	 14.5      Use of Names, Trade Names and Trademarks
	  	51
	 14.6      Accounting Procedures
	  	51
	 14.7      Force Majeure
	  	51
	 14.8      Assignment
	  	51
	 14.9      Amendments and Waivers
	  	52
	 14.10    Severability
	  	52
	 14.11    Undertakings of Affiliated Companies
	  	52
	 14.12    Approvals
	  	52
	 14.13    Counterparts
	  	52
	 14.14    Independent Contractor
	  	52
	 14.15    Interpretation
	  	52

  

 iii 

 DEVELOPMENT, LICENSE AND COMMERCIALIZATION AGREEMENT 
  
 This DEVELOPMENT, LICENSE AND COMMERCIALIZATION AGREEMENT
(“Agreement”) is made effective as of the 13th day of May, 2005 (the “Effective Date”) by and between BioMarin Pharmaceutical Inc., a corporation organized under the laws of Delaware and having its
principal place of business at 105 Digital Drive, Novato, California 94949 (“BioMarin”) and Ares Trading S.A., a corporation organized under the laws of Switzerland and having a principal place of business at Zone
Industrielle de l’Ouriettaz, 1170 Aubonne, Switzerland (“Serono”). BioMarin and Serono are each referred to herein as a “Party” and collectively as the
“Parties”. 
  
 RECITALS

  
 WHEREAS, BioMarin is engaged generally in the
research and development of biopharmaceutical products and has developed, licensed or acquired certain intellectual property relating to those certain investigational therapies currently referred to by BioMarin as Phenoptin and Phenylase (each
hereinafter defined in greater detail); 
  
 WHEREAS,
BioMarin is developing Phenoptin and Phenylase for the treatment of genetic disorders that are characterized by an inability of the body to metabolize the essential amino acid, phenylalanine (“PKU”), including, without limitation,
phenylketonuria, and is also developing Phenoptin and Phenylase for the treatment of other disorders; 
  
 WHEREAS, Serono is engaged generally in the research, development, manufacture, marketing, distribution and sales of biopharmaceutical products;
and 
  
 WHEREAS, Serono has expressed a desire to
collaborate with BioMarin on further development of Phenoptin and Phenylase and to obtain an exclusive license to commercialize pharmaceutical products containing Phenoptin and Phenylase for PKU and other indications. 
  
 NOW, THEREFORE, in consideration of the mutual covenants,
representations, warranties and promises contained herein, the Parties hereby agree as follows: 
  

	1.	DEFINITIONS 

  
 In addition to the terms defined in the text of this Agreement, for purposes of this Agreement, the following terms shall have the following respective
definitions: 
  

	1.1	“Acceptance of MAA” means the receipt of notice from the relevant Regulatory Agency that an MAA has met all the criteria for filing acceptance.

  

	1.2	“Affiliate” means any Entity, which, at the time in question, is directly or indirectly owned by or controlled by, or under common control with, BioMarin or
Serono, as the case may be. For the purposes of this definition, a Party shall be deemed to have “control” if such Party (a) owns, directly or indirectly, 50% or more of (i) the voting stock or shareholders’ equity of a corporation,
(ii) the partnership interests in a partnership, or (iii) the membership interests in a limited liability company, or (b) possesses, directly or indirectly, the power to direct or cause the direction of the management and policies of the Entity or
the power to elect more than 50% of the members of the governing body of the Entity. 

  

	1.3	“Allocable Overhead” means [****] 

  

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	1.4	“Audit Report” shall have the meaning set forth in Section 8.4. 

  

	1.5	“Bankruptcy Code” has the meaning set forth in Section 10.2(c)(i). 

  

	1.6	“BioMarin Background Technology” means: (a) all inventions, discoveries, know-how, methods, processes, data, information, technology, research tools,
compositions, formulas and tangible materials Controlled by BioMarin or its Affiliates that (i) as of the Effective Date, BioMarin knows or should know (based on at least preliminary data) to be necessary for BioMarin’s development or
manufacturing obligations under this Agreement, (ii) are necessary for Serono, its Affiliates or Sublicensees to develop, use, sell, offer to sell, or import Licensed Products, (iii) are used by BioMarin in connection with any Licensed Products, or
(iv) other than Project Technology, are actually used by BioMarin or its Affiliates, during and in the course of BioMarin’s development or manufacturing obligations under this Agreement (collectively, the “BioMarin
Technology”); (b) other than Project Technology, any and all improvements to the BioMarin Technology, to the extent invented, discovered, developed or otherwise generated or Controlled by BioMarin or its Affiliates directly through
BioMarin’s development or manufacturing obligations hereunder; and (c) all Patents, trade secrets, and other intellectual property rights Controlled by BioMarin anywhere in the world in and to any of the BioMarin Technology and improvements
thereto described in subsections (a) and (b), above. 

  

	1.7	“BioMarin Indemnitees” has the meaning set forth in Section 12.1. 

  

	1.8	“BioMarin IP” means the BioMarin Project Technology and the BioMarin Background Technology. 

  

	1.9	“BioMarin Losses” has the meaning set forth in Section 12.1. 

  

	1.10	“BioMarin Patent” means any Patent (a) listed on Schedule 1.10 hereto or (b) otherwise included in the BioMarin IP. 

  

	1.11	“BioMarin Project Technology” means Project Technology invented, discovered, developed or otherwise generated by BioMarin and its Affiliates (and not Serono
or its Affiliates). 

  

	1.12	“BioMarin’s Knowledge” means [****] 

  

	1.13	“Business Day” means any day excluding Saturday, Sunday and any day which shall be in the State of New York, Novato, California, or in Aubonne, Switzerland,
a legal holiday or a day on which banking institutions are authorized by law to close. 

  

	1.14	“Calendar Quarter” means each three (3) month period commencing January 1, April 1, July 1, or October 1. 

  

	1.15	“Cause” shall have the meaning set forth in Section 10.3. 

  

	1.16	“CEO” means, with respect to a Party, the Chief Executive Officer of such Party. 

  

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	1.17	“cGCP” means the current standards, practices and procedures set forth in the International Conference on Harmonization (ICH) guidelines entitled
“Guidance for Industry E6 Good Clinical Practice: Consolidated Guidance,” including related requirements imposed by the FDA, and equivalent foreign regulations or standards, as applicable, as such standards, practices, procedures,
requirements and regulations may be amended from time to time. 

  

	1.18	“cGLP” means the current good laboratory practices regulations promulgated by the FDA, published at 21 C.F.R. § 58, and equivalent foreign regulations
or standards, as applicable, as such current good laboratory practices, regulations and equivalent foreign regulations or standards may be amended from time to time. 

  

	1.19	“cGMP” means, as applicable, those current practices, as amended from time to time, related to the manufacture of pharmaceutical products and any precursors
thereto promulgated in guidelines and regulations of standard compilations including the GMP Rules of the World Health Organization, the United States Code of Federal Regulations, the Guide to Inspection of Bulk Pharmaceutical Chemicals (established
by the United States Department of Health and Human Services), the Pharmaceutical Inspection Convention, and the European Community Guide to Good Manufacturing Practice in the production of pharmaceutical products. 

  

	1.20	“Claim” has the meaning set forth in Section 12.3. 

  

	1.21	“Clinical Proof of Concept” means a Phase II Clinical Trial in patients, showing a difference of efficacy between a Licensed Product and an appropriate
control, as evidenced by results showing a statistically significant difference in one or more clinical or validated surrogate endpoint(s) that are suitable as the primary endpoint(s) for a Phase III Clinical Trial.

  

	1.22	“Combination Product” means a product containing a Licensed Product together with one or more other active ingredients, devices, equipment or
components that are themselves not Licensed Products. 

  

	1.23	“Commercial Team” means the working group to be established for each Licensed Product upon completion of the development of such Licensed
Product as provided in Section 3.4. 

  

	1.24	“Commercial Team Leader” means the persons appointed by each Party pursuant to Section 3.4 to serve as contact person between the
Parties in relation to the commercialization of the Licensed Products. 

  

	1.25	“Commercially Reasonable Efforts” means, a Party’s use of those efforts and resources, consistent with the exercise of prudent scientific and business
judgment that it, considered in consolidation with its Affiliates, would apply with respect to its own products at a similar stage of development or commercialization, with similar commercial potential. 

  

	1.26	“Common Technical Document” means a common information format for regulatory submission in the European Union, the United States, and Japan, as defined by
the International Conference on Harmonization. 

  

	1.27	“Completion of Phase II” occurs for a Licensed Product in an Indication with the first administration of such Licensed Product to a patient in a Phase III
Clinical Trial of such a Licensed Product for such Indication.  

  

 3 

	1.28	“Confidential Information” means (a) all unpublished scientific and technical information received by a Receiving Party from a Disclosing Party pursuant to
this Agreement or so received prior to the Effective Date but in contemplation of this Agreement; and (b) all trade secrets or information relating to the business affairs or finances of a Disclosing Party or its Affiliates, or of their suppliers,
agents, distributors, licensees or customers, maintained as confidential by such Disclosing Party and disclosed by such Disclosing Party to a Receiving Party pursuant to this Agreement, or in contemplation of this Agreement.

  

	1.29	“Contractors” means a Third Party or an Affiliate of a Party to which such Party desires to subcontract any portion of its contractual obligations hereunder,
to the extent permitted pursuant to the terms of this Agreement. 

  

	1.30	“Controls” or “Controlled” mean that the Person referenced has the right to exploit and to license or sublicense the right to exploit
the referenced technology or rights, as provided for in this Agreement, without (assuming the timely payment of all applicable royalties and otherwise complying with the restrictions of any applicable license or sublicense) violating any
intellectual property rights of a Third Party or the terms of any agreement or other arrangement with any Third Party. 

  

	1.31	“Cost of Goods” means [****] 

  

	1.32	“Development Activities” means the activities performed by a Party as required under a Development Plan. 

  

	1.33	“Development Collaboration” means the Parties’ collaborative efforts (including each Party’s development obligations) with respect to the
development of Licensed Products pursuant to this Agreement. 

  

	1.34	“Development Costs” means [****] 

  

 4 

	1.35	“Development Plan” means the development plan and budget for a Licensed Product, including, at a minimum, specific details regarding Development Costs, and
assignment of responsibilities to the Parties for the development of such Licensed Product. In the event that a Licensed Product is being developed for multiple unrelated Indications, a separate Development Plan will be created and applicable for
each such Indication or group of related Indications, provided that a separate Development Plan will be created for each Indication within the group of related Indications prior to Completion of Phase II. 

  

	1.36	“Development Team” shall mean a working group to be established for each Licensed Product for an Indication prior to Completion of Phase II for such Licensed
Product for such Indication as are otherwise provided in Section 3.3. 

  

	1.37	“Development Team Leader” means the persons appointed by each Party pursuant to Section 3.3 to serve as contact persons between the Parties, as well
as the liaison between the Steering Committee and each Development Team in relation to the Development Collaboration. 

  

	1.38	“Disclosing Party” has the meaning set forth in Section 13.1. 

  

	1.39	“EMEA” means the European Medicines Agency or any successor agency. 

  

	1.40	“Entity” means any corporation (including any non-profit corporation), general partnership, limited partnership, limited liability partnership, joint
venture, estate, trust, cooperative, foundation, company (including any limited liability company or joint stock company), firm or other enterprise, association, organization or entity. 

  

	1.41	“Existing Third Party Agreements” means: (a) the License Agreement between BioMarin and Merck Eprova AG dated October 15, 2004, amended as of January 25,
2005; (b) the License Agreement between BioMarin and Daiichi Suntory Pharma Co., Ltd. dated as of July 30, 2004, amended as of November 19, 2004; (c) the Supply Agreement dated July 30, 2004 among BioMarin, Daiichi Suntory Pharma Co., Ltd. and
Shiratori Pharmaceutical Co., Ltd; (d) the Research Funding and Option Agreement between BioMarin and The Scripps Research Institute dated as of December 17, 2004; (e) the License Agreement between BioMarin and the Scripps Research Institute dated
December 17, 2004; and (f) the License Agreement between BioMarin and Daiichi Suntory Pharma Co., Ltd. dated as of May 2, 2005. 

  

	1.42	“FDA” means the United States Food and Drug Administration or any successor agency vested with administrative and regulatory authority to approve testing and
marketing of human pharmaceutical or biological therapeutic or diagnostic products in the United States. 

  

 5 

	1.43	“Field” means all therapeutic, diagnostic or preventative uses. 

  

	1.44	“Financial Difficulty” means the occurrence with respect to any Party of such Party: (a) filing in any court pursuant to any statute, a petition in
bankruptcy or insolvency or for reorganization in bankruptcy or for an arrangement or for the appointment of a receiver or trustee for such Party or of its assets; (b) being served with an involuntary petition against it, filed in any insolvency
proceeding, and where such petition has not been dismissed within sixty (60) days after the filing thereof; (c) proposing or being a party to any dissolution; or (d) making an assignment for the benefit of creditors. 

  

	1.45	“First Indication” means the first Indication for which a Licensed Product achieves a milestone set forth in Schedule 7.2(b)(i). [****]

  

	1.46	“GAAP” means generally accepted accounting principles in effect in the United States, as consistently applied by a Party in the preparation of its financial
statements. 

  

	1.47	“Governmental Body” means any: (a) nation, principality, state, commonwealth, province, territory, county, municipality, district or other jurisdiction of
any nature; (b) federal, state, local, municipal, foreign or other government; (c) governmental or quasi-governmental authority of any nature (including any governmental division, subdivision, department, agency, bureau, branch, office, commission,
council, board, instrumentality, officer, official, representative, organization, unit, body or Entity and any court or other tribunal); (d) multi-national or supranational organization or body; or (e) individual, Entity or body exercising, or
entitled to exercise, any executive, legislative, judicial, administrative, regulatory, police, military or taxing authority or power of any nature. 

  

	1.48	“Indemnitee” has the meaning set forth in Section 12.3. 

  

	1.49	“Indication” means the treatment or prevention of a generally acknowledged disease or medical condition, a significant manifestation of a disease or medical
condition, or symptoms associated with a disease or medical condition. For the avoidance of doubt, the treatment of different medical conditions in patients having the same underlying disease shall not be treated as the same Indication (for example
the treatment of cardiac disease and retinopathy in patients with diabetes), while the treatment of the same condition in variants of a single disease shall be treated as the same Indication (for example the treatment of elevated blood phenylalanine
in classical PKU, moderate PKU, and hyperphenylalaninemia (HPA) are all one Indication). 

  

	1.50	“Joint Patents” means Patents in or to any Joint Project Technology. 

  

	1.51	“Joint Project Technology” means Project Technology that is jointly invented, discovered, developed or otherwise generated by BioMarin and Serono or their
respective Affiliates. 

  

	1.52	“Law” or “Laws” means all applicable laws, statutes, rules, regulations, ordinances and other pronouncements having the binding effect of law of
any Governmental Body. For purposes of this Agreement, “Laws” shall include cGCP, cGLP and cGMP. 

  

	1.53	“Licensed Product” means any product incorporating Phenoptin or Phenylase as an active pharmaceutical ingredient, either alone or with one or more other
pharmaceutical ingredients, 

  

 6 

	 	including all additions, mutations, post-translational modifications (e.g., PEGylation), rearrangements, and other modifications thereto and any other pharmaceutical product that:
(a) the manufacture, use, sale, offer to sell or import thereof, would infringe one or more Patent Claims under any Patents in or to any BioMarin IP; or (b) the research, development, formulation, composition or manufacture of which was performed
with the use of or incorporates any BioMarin IP; or (c) the development of which was in part funded by BioMarin under this Agreement. The term Licensed Product shall include Supplied Product. 

  

	1.54	“MAA” means the marketing authorization application filed with the requisite Regulatory Agency of any country in the Territory requesting Regulatory Approval
for commercial sale of a Licensed Product for a particular Indication in such country. 

  

	1.55	“Major Indication” means each of the following Indications: (a) peripheral vascular insufficiency or related complications such as leg ulcers, distal limb
infections or risk for amputation in diabetes; (b) congestive heart failure; (c) coronary artery disease, including chronic or acute treatment of angina pectoris in diabetics or other similar sized populations; and (d) atherosclerosis, including in
diabetics, hypercholesterolemics or similar sized populations. 

  

	1.56	“Milestone Fees” has the meaning set forth in Section 7.2. 

  

	1.57	“Minor Indication” means each Indication, excluding PKU that is not a Major Indication. 

  

	1.58	“Multiple Products Sale” means the sale of a Licensed Product for an Indication by Serono that is associated, by contract or course of dealing, with the use
or sale of one or more other products or services. 

  

	1.59	“Net Sales” means [****] 

  

 7 

	1.60	“Orphan Drug Status” means an award of marketing exclusivity under the Orphan Drug Act of 1983 in the United States or any comparable Law in an applicable
jurisdiction that provides a period of marketing exclusivity, which designation has not been revoked or expired. 

  

	1.61	“Patent Claim” means a claim of any unexpired granted Patent that has not: (a) lapsed, expired, been disclaimed, or canceled; (b) been finally rejected or
held or admitted to be invalid or unenforceable by a decision of a patent-granting authority of a Governmental Body from which no appeal is or can be taken; or (c) been held invalid or unenforceable in an unappealable decision of a court or other
competent Governmental Body having jurisdiction (including a decision which was appealable, but which was not timely appealed). 

  

	1.62	“Patent Committee” has the meaning set forth in Section 9.2. 

  

	1.63	“Patent Country” means, with respect to any particular Patent, the country in which such Patent is pending or granted. 

  

	1.64	“Patents” means (a) patent applications filed in any country; (b) all provisional, divisional, continuation (in whole or in part) or substitute applications
with respect to any of the applications described in (a); (c) all issued or granted patents resulting from any of the applications described above; and (d) all issued or granted reissue, re-examination, renewal or extension patents, supplementary
protection certificates, and confirmation or registration patents or patents of addition based on any of the patents described in (c). 

  

	1.65	“Person” means any individual, Entity or Governmental Body. 

  

 8 

	1.66	“Phase II Clinical Trial” means a human clinical trial conducted for inclusion in (a) that portion of the FDA submission and approval process which provides
for trials of a pharmaceutical product on a limited number of patients for the purposes of collecting data on dosages, evaluating safety and/or collecting preliminary information regarding efficacy in the proposed Indication, as more fully defined
in 21 C.F.R. § 312.21(b), and (b) equivalent submissions with similar requirements to the EMEA or to similar Regulatory Agencies in countries in the Territory. 

  

	1.67	“Phase III Clinical Trial” means a human clinical trial which, when considered either alone or together with one or more clinical trials of comparable design
and end-points, is intended to generate efficacy data sufficient to obtain Regulatory Approval in the proposed therapeutic Indication, as more fully defined in 21 C.F.R. § 312.21(c). 

  

	1.68	“Phenoptin” means tetrahydrobiopterin (6R-BH4). 

  

	1.69	“Phenylase” means phenylalanine ammonia lyase. 

  

	1.70	“PKU” has the meaning set forth in the Recitals. 

  

	1.71	“Proceeding” means any claim, action, suit, litigation, arbitration, proceeding (including any civil, criminal, administrative, investigative or appellate
proceeding), or investigation commenced, brought, conducted or heard by or before, or otherwise involving, any Governmental Body or any arbitrator or arbitration panel. 

  

	1.72	“Project Technology” means all inventions, discoveries, know-how, methods, processes, data, information, technology, research tools, compositions, tangible
materials (including, without limitation, vectors, proteins, assays and the like) and formulas that are invented, discovered, developed or otherwise generated by either Party, their respective Affiliates or both Parties jointly pursuant to the
Development Collaboration, and all Patents, trade secrets, and other intellectual property rights therein and thereto anywhere in the world. The Parties shall follow the principles of inventorship under United States patent law in order to determine
the Party that invented, discovered, developed or otherwise generated any item of Project Technology. 

  

	1.73	“Quality Agreement” means the agreement to be entered into between the Parties setting out the responsibilities between the Parties for the
technical and quality assurance aspects (including cGMP) of the supply of Supplied Product provided by BioMarin to Serono. 

  

	1.74	“Recall Costs” means [****] 

  

	1.75	“Receiving Party” has the meaning set forth in Section 13.1. 

  

	1.76	“Regulatory Agency” means (a) the FDA, (b) the EMEA, or (c) any other Governmental Body with regulatory authority comparable to the FDA or the EMEA in any
other jurisdiction anywhere in the world. 

  

	1.77	“Regulatory Approval” means the authorization by an appropriate Regulatory Agency to market and sell a Licensed Product for an Indication in a jurisdiction.

  

 9 

	1.78	“Royalty Term” means with respect to each Licensed Product in each country in the Territory, on a country-by-country basis, the period from the Effective
Date until the later of (a) the expiration of the last to expire Patent Claim of a BioMarin Patent or a Joint Patent in such country covering such Licensed Product or (b) ten (10) years after the first commercial sale of such Licensed Product after
receipt of Regulatory Approval for such Licensed Product in such country. Sales of Licensed Products under limited access, named patient programs shall not be considered a commercial sale commencing the ten (10) year period.

  

	1.79	“Second Indication” means the second Indication for which a Licensed Product achieves a milestone set forth in Schedule 7.2(b)(ii). [****]

  

	1.80	“Serono Background Technology” means (a) all inventions, discoveries, know-how, methods, processes, data, information, technology, research tools,
compositions, formulas and tangible materials Controlled by Serono or its Affiliates that (i) as of the Effective Date, Serono knows or should know (based on at least preliminary data) to be necessary for Serono’s development obligations under
this Agreement, (ii) are necessary for BioMarin, its Affiliates and Sublicensees to develop, use, sell, offer to sell, or import Licensed Products, (iii) is used by Serono in connection with any Licensed Products, or (iv) other than Project
Technology, are actually used by Serono or its Affiliates, during and in the course of Serono’s development obligations under this Agreement (collectively, the “Serono Technology”); (b) other than Project Technology, any
and all improvements to the Serono Technology, to the extent invented, discovered, developed or otherwise generated by Serono or its Affiliates directly through Serono’s development obligations hereunder; and (c) all Patents, trade secrets, and
other intellectual property rights anywhere in the world in and to any of the Serono Technology and improvements thereto described in subsections (a) and (b), above. 

  

	1.81	“Serono Indemnitees” has the meaning set forth in Section 12.2. 

  

	1.82	“Serono IP” means the Serono Project Technology and the Serono Background Technology. 

  

	1.83	“Serono Losses” has the meaning set forth in Section 12.2. 

  

	1.84	“Serono Patents” means Patents in or to Serono IP. 

  

	1.85	“Serono Project Technology” means Project Technology invented, discovered, developed or otherwise generated by Serono and its Affiliates (and not BioMarin or
its Affiliates). 

  

	1.86	“Specifications” has the meaning set forth in Section 5.15(a). 

  

	1.87	“Steering Committee” means the committee described in Section 3.2. 

  

	1.88	“Sublicensee” means a Third Party to whom Serono or BioMarin has extended a sublicense consistent with Section 4. 

  

	1.89	“Supplied Product” means the formulated form of a Licensed Product in bulk, or at Serono’s option, primary, packaging. 

  

 10 

	1.90	“Term” has the meaning set forth in Section 10.1. 

  

	1.91	“Term Sheet” means that certain term sheet dated December 9, 2004 and executed by a duly authorized representative of each of the Parties.

  

	1.92	“Territory” means all countries of the world excluding Japan and the United States, and all of their respective territories, possessions and protectorates,
provided, however that for the purpose of Serono’s development of Licensed Products jointly with BioMarin pursuant to a Development Plan, the Territory shall include the United States. 

  

	1.93	“Third Party” means any Person other than BioMarin, Serono, or their respective Affiliates. 

  

	1.94	“Third Party Agreement” means any agreement, other than an Existing Third Party Agreement, entered into with a Third Party by either Party, or their
respective Affiliates or Sublicensees, or any amendment or supplement thereto, whereby royalties, fees or other payments are to be made to the Third Party based on the exploitation of, or obtaining of rights under, intellectual property rights of
the Third Party related to a Licensed Product. 

  

	2.	DEVELOPMENT COLLABORATION 

  

	2.1	Development Plans. The Parties wish to collaborate in the development of the Licensed Products pursuant to mutually agreed upon Development Plans. The Parties
agree to discuss, prepare and negotiate in good faith a Development Plan for each Indication or group of related Indications. By way of example and not of limitation, the Parties may create Development Plans for: (i) Phenylase for the treatment of
PKU; (ii) Phenoptin for the treatment of Indications other than PKU; and (iii) Phenylase for the treatment of Indications other than PKU. Neither Party will be obligated to collaborate with the other Party in developing any Licensed Product until
and unless both Parties approve the applicable Development Plan for such License Product, including the budget for the Development Plan. The Parties hereby approve the Development Plan for Phenoptin in PKU attached hereto as Exhibit 2.1. Upon
approval of each Development Plan, subject to this Section 2.1 and Section 2.3, the Parties will use Commercially Reasonable Efforts to develop a Licensed Product pursuant to the Development Plan. Subject to Section 2.4, through
the Completion of Phase II, unless otherwise agreed by the Parties as provided in a Development Plan, BioMarin will be solely responsible for conducting all Development Activities with respect to such Development Plan, and Serono shall have no
responsibility for such Development Activities. For any Licensed Product to be jointly developed under a Development Plan, disputes will be settled pursuant to the decision making process set forth in Section 3.2(c). 

 

	2.2	Payment for Development Activities. Except as otherwise provided in this Section 2, through the Completion of Phase II, unless otherwise agreed by the Parties
as provided in a Development Plan, BioMarin will be solely responsible for all Development Costs incurred in connection with the Development Activities and Serono shall have no responsibility for payment of such Development Costs. Except as
otherwise provided in this Section 2, upon Completion of Phase II, the Parties will share equally the Development Costs incurred in connection with the Development Activities. Further, no party shall be entitled to earn a profit margin on
such Development Costs. [****] 

  

 11 

	2.3	Opt-Out Option. At any time, subject to the process described below, if the Parties cannot agree to a Development Plan or a proposed change to a Development
Plan, or a Party does not elect to continue a Development Plan for any reason, either Party may decline to participate or decline to continue to participate in the development pursuant to the Development Plan going forward (“Opt-Out
Option”). To exercise the Opt-Out Option, the exercising Party must provide written notice to that effect to the other Party (“Opt-Out Notice”). The Opt-Out Notice will be effective ninety (90) days after the
date of the Opt-Out Notice if: (i) the approved annual budget for the Development Plan for the year in which the Opt-Out Notice would be effective is [****]; (ii) the Opt-Out Notice is delivered within sixty (60) days after data from a Phase III
Clinical Trial under the Development Plan is unblinded and made generally available to the Parties; or (iii) the Opt-Out Notice is delivered within ten (10) Business Days after the approval of an annual budget by the Steering Committee, if such
approval occurs after the September 20th immediately prior to the calendar year to which such annual budget pertains. If none of the foregoing applies, the Opt-Out Notice will be effective on the next January 1st that occurs not less than ninety
(90) days after delivery of the Opt-Out Notice. Until the effective date of such Opt-Out Notice, the Parties will attempt to develop a mutually agreeable Development Plan and, until the effective date of the Opt-Out Notice, the Party exercising the
Opt-Out Option will continue to perform its obligations under the last Development Plan approved prior to the Opt-Out Notice, including any payment obligations. 

  

	2.4	Independent Development. 

  

	 	(a)	Development Prior to Completion of Phase II. If either Party exercises an Opt-Out Option prior to the Completion of Phase II for a Licensed Product for an Indication
under a Development Plan, such Party may independently, at is sole cost, continue development of such Licensed Product for such Indication. 

  

	 	(b)	Development After Completion of Phase II. If a Party exercises the Opt-Out Option after Completion of Phase II, except as provided below, the other Party shall have the
right, but not the obligation, to continue the development of the Licensed Product for the Indication contemplated by the Development Plan, at its sole cost. For so long as the developing Party is using Commercially Reasonable Efforts to continue
development of such Licensed Product for such Indication through Regulatory Approval by the EMEA or FDA, as applicable, until such Regulatory Approval is obtained, the Party exercising the Opt-Out Option shall not independently develop such Licensed
Product for such Indication. Subject to the foregoing limitation, a Party exercising an Opt-Out Option shall have the right, but not the obligation, to develop the Licensed Product for the Indication contemplated by the Development Plan, at its sole
cost. 

  

	 	(c)	Limitations on Independent Development for Safety Concerns. [****] 

  

 12 

	 	(d)	Payment of Milestones on Independent Development. [****]. 

  

	 	(e)	Use of Independently Developed Data. Any data developed independently by or on behalf of BioMarin or Serono pursuant to Section 2.4 shall be fully disclosed to the
other Party but may only be utilized by the other Party to the limited extent necessary in connection with providing Regulatory Agencies safety information as required in connection with Regulatory Approvals related to a Licensed Product. Without
limiting the foregoing, such other Party shall not be entitled to use any data developed pursuant to Section 2.4 for any other purpose, except pursuant to an Opt-In Notice as described below. 

  

	2.5	Cost Reports. 

  

	 	(a)	Development Costs under a Development Plan. Within thirty (30) days after the end of each Calendar Quarter, the Parties shall compile and exchange accurate and complete
information concerning their respective Development Cost expenditures for each Licensed Product under development pursuant to a Development Plan. Such exchanged information shall include a comparison of each Party’s actual Development Cost
expenditures against the Development Cost expenditures that were budgeted in the applicable Development Plan. Unbudgeted Development Costs that were reasonably incurred under the circumstances shall be subject to each Party’s
obligation to share the Development Costs equally, as set forth in Section 2.2, so long as such expenses do not [****]. No later than thirty (30) days after the exchange of the Parties’ respective Development Cost expenditure
information, the Parties shall reconcile all Development Cost expenditure amounts through a net payment to the Party incurring greater Development Cost expenditures in such Calendar Quarter. 

  

	 	(b)	Reports for Independent Development of a Licensed Product. If one Party has exercised the Opt-Out Option for a Development Plan and one or both Parties are independently
developing a Licensed Product which would have been jointly developed under the Development Plan, within thirty (30) days after the end of each Calendar Quarter, each Party developing the Licensed Product will provide to the other Party a report
containing a detailed account of the costs incurred by the Party developing the Licensed Product during the previous Calendar Quarter that would have been Development Costs if they had been incurred pursuant to a Development Plan, along with an
executive summary of the status of the development effort including (i) the basis for such costs, (ii) whether any clinical trial is being planned or being performed, and (iii) regulatory status. 

  

 13 

	 	(c)	Right to Audit Development Costs. Pursuant to the procedures set forth in Section 8.4, each Party will have the right to audit appropriate records of the other Party
to verify Development Cost expenditures related to the other Party’s activities under the Development Plans. 

  

	2.6	Opt-In Rights. 

  

	 	(a)	Opt-In Procedure. If one Party has exercised the Opt-Out Option for a Development Plan under Section 2.3 and either Party has elected to independently develop a
Licensed Product (“Developing Party”) as permitted under Section 2.4, the other Party (“Opting-In Party”) will have the option to elect at any time to participate in future development and
commercialization of the Licensed Product under a Development Plan to be prepared by the Developing Party as provided in Section 2.6(b) (“Opt-In Option”). To exercise the Opt-In Option, the Opting-In Party must provide
written notice to that effect to the Developing Party (“Opt-In Notice”) and reimburse the Developing Party the following amounts (“Opt-In Amount”): [****]. Within twenty (20) days after receiving the
Opt-in Notice, the Developing Party will provide the Opting-In Party a statement setting forth the costs payable to the Developing Party under this Section 2.6. 

  

	 	(b)	Effect of Opt-In. Upon receipt of the Opt-In Notice, the Developing Party shall deliver its present development plan for such Licensed Product, which shall be the Development
Plan in effect following the receipt of the Opt-In Notice, subject to such changes as the Developing Party may agree to and the results of all research and development by the Developing Party undertaken by the Developing Party with respect to the
Licensed Product for such Indication shall be considered Project Technology, and the development of such Licensed Product by the Developing Party shall thereupon be deemed to have been conducted by the Parties as part of the Development
Collaboration, and all provisions of this Agreement relating thereto (other than the sharing of Development Costs up to the date of the Opt-In Notice) shall apply. 

  

	 	(c)	Audit of Opt-In Amount. Pursuant to the procedures set forth in Section 8.4, the Opting-In Party will have the right to audit the Developing Party to verify the
accuracy of the Opt-In Amount. 

  

	3.	DEVELOPMENT OF LICENSED PRODUCTS 

  

	3.1	Development Governance. 

  

	 	(a)	For Licensed Products under development pursuant to a Development Plan, BioMarin shall exclusively manage the development of Licensed Products under the supervision of the Steering
Committee, until the Completion of Phase II. 

  

	 	(b)	For Licensed Products under development pursuant to a Development Plan, following Completion of Phase II for a Licensed Product for an Indication, upon formation of the Development
Team, the Development Team shall manage the day-to-day development of such Licensed Product based upon the Development Plan. Each Development Plan shall allocate functional management of each activity under the Development Plan to the Parties with
due regard for each Party’s legitimate concerns and interests as well as the completion of the Development Plan as a whole. 

  

 14 

	 	(c)	Upon Regulatory Approval of a Licensed Product for an Indication by both the FDA and the EMEA, all further development, including any post marketing approvals required by a
Regulatory Agency, shall be exclusively managed in the Territory by Serono and shall be exclusively managed outside the Territory by BioMarin. Notwithstanding the foregoing, the Parties will endeavor in good faith to coordinate any overlapping post
marketing commitments and to equitably allocate any expenses. 

  

	3.2	Steering Committee. 

  

	 	(a)	Role and Responsibilities. The Steering Committee will consist of six (6) members in total, with an equal number of members from each of the Parties. The members of the
Steering Committee shall be senior personnel of their respective designating Parties. Each of the Parties shall notify the other as to its designees within thirty (30) days following the Effective Date. The Steering Committee will be deemed to be
established on the date by which each Party shall have notified the other Party as to their respective initial designees. One member of the Steering Committee will be designated as the “Chairperson.” The Chairperson of the Steering
Committee shall rotate on an annual basis, and the Steering Committee member designated by Serono shall be the first Chairperson. The Steering Committee shall oversee, review, and direct the Development Collaboration. The responsibilities of the
Steering Committee shall include: 

  

	 	(i)	monitoring the progress of the Development Collaboration and ensuring open and frequent exchange between the Parties; 

  

	 	(ii)	administering the Development Collaboration and approving Development Plans, including any updates or amendments thereto; 

  

	 	(iii)	monitoring the Parties’ respective activities with respect to each Development Plan; 

  

	 	(iv)	monitoring and reviewing the activities of the Patent Committee; 

  

	 	(v)	approving annual and overall budgets for each Development Plan submitted by the Development Team(s), and any updates or amendments thereto; 

  

	 	(vi)	attempting to resolve any disputes arising within the Development Team(s); and 

  

	 	(vii)	performing such other functions as appropriate to further the purposes of this Agreement as determined by the Parties. 

  

	 	(b)	Steering Committee Meetings. 

  

	 	(i)	Either Party may call at anytime a meeting of the Steering Committee by the delivery of not less than five (5) business days advance written notice thereof to the other Party. The
first meeting of the Steering Committee shall occur within sixty (60) days after the Effective Date. The Steering Committee shall meet in person at least semi-annually at mutually agreed upon times and locations, and telephonically at least
quarterly between in-person meetings, at mutually agreed 

  

 15 

	 	 	upon times. Unless otherwise agreed, such meetings shall not be consistently held at the offices of either Party. The Steering Committee may also hold meetings via telephone
conference, video conference or other remote access system. Additional representatives of a Party may attend any Steering Committee meeting as nonvoting observers with the consent of the other Party, not to be unreasonably withheld. Each Party shall
be responsible for all of the expenses associated with the attendance of its representatives at such meetings. The Steering Committee shall also address issues as they arise in the interim via special meetings or electronic mail.

  

	 	(ii)	The Chairperson will prepare a written agenda for each meeting, provided that either Party may request that specific items be included in the agenda. The Chairperson will send to
the other members of the Steering Committee notice of the meetings including the agenda for the meeting. The Chairperson will prepare written minutes of each meeting including the issues discussed, formal actions taken by the Steering Committee, and
action items, if any, arising from the meeting. Meeting minutes and written summaries of any action taken by way of interim communications shall be promptly submitted (i) to all members of the Steering Committee, and (ii) to such other Persons as
the Steering Committee may direct from time to time. No actions or decisions shall be effective unless approved by the Steering Committee in writing (including by email or facsimile) or by vote at a meeting of the Steering Committee followed by the
entry of such action or decision into the minutes of such meeting followed by the approval of such minutes by the members of the Steering Committee of both Parties. 

  

	 	(c)	Decision Making. Decisions of the Steering Committee shall be made by unanimous agreement, and the members of the Steering Committee designated by a Party shall collectively
have a single vote. If unanimity is not achieved on any action considered by the Steering Committee, such matter may be referred by either Party to the Chief Executive Officer of BioMarin and the Chief Executive Officer of Serono, by the delivery of
written notice to such effect to such individuals, and such individuals shall promptly meet and endeavor in good faith to resolve such matters in a timely manner, taking into account the reasonable interests and opinions of both Parties. All
proceedings involving disputes between the Parties shall be conducted exclusively in the English language. If such individuals do not resolve such matter within thirty (30) Business Days from the receipt of the written notice described in the second
sentence of this Section 3.2(c) then: 

  

 16 

	 	 	[****] provided that any such decision by either Party shall be made taking into account the reasonable interests and opinions of both Parties. 

  

	 	(d)	Replacement of Steering Committee Members. Members of the Steering Committee may be removed or replaced from time to time by the Party that so designated such personnel and
each Party shall promptly notify the other Party in writing of any substitution of such designating Party’s personnel. 

  

	3.3	Development Team and Development Team Leaders Roles and Responsibilities. At the first meeting of the Steering Committee, the Steering Committee shall establish
a Development Team for Phenoptin in PKU. No later than forty-five (45) days after the Completion of Phase II for Phenoptin for any non-PKU Indication or for any other Licensed Product for any Indication, as applicable, or upon such earlier date as
the Steering Committee may deem appropriate, the Steering Committee shall establish a Development Team for such Licensed Product in such Indication. Each Development Team shall consist of a Development Team Leader from each Party and a number of
members to be agreed upon by the Steering Committee from time to time, with an equal number of members to be designated by each Party. At least two-thirds of the members of the Development Team shall constitute a quorum. Each Party’s designees
shall be employees of their respective Parties in the areas of program management, research and development, manufacturing, commercial, regulatory affairs, finance or such other functional area as deemed appropriate by such Party, and each Party
shall designate its initial Development Team Leader. The Development Team Leaders shall co-lead the Development Team. The Development Team Leaders will alternate serving as the Chairperson of the Development Team, with each Development Team Leader
acting as Chairperson of the Development Team for a period of one (1) year. BioMarin shall designate the first Chairperson of the Development Team. Each Party shall have the right to replace its Development Team Leader at any time by prior written
notice to the other Party. 

  

	 	(a)	The first meeting of each Development Team shall occur within thirty (30) days of the establishment of such Development Team. Thereafter, unless otherwise agreed to by the
Development Team Leaders, each Development Team shall meet in person at least quarterly and telephonically at least monthly between in-person meetings, and as often as is deemed necessary by the Development Team Leaders on such Development Team.
There shall be an agenda for each meeting of each Development Team and minutes of 

  

 17 

	 	 	each meeting shall be taken by the Chairperson and shall include the issues discussed and action items, if any, arising from such meeting. Meeting minutes shall be submitted to the
members of such Development Team and the Steering Committee. Each Party shall be responsible for all of the expenses associated with the attendance of its representatives at such meetings. All formal actions of a Development Team must receive the
approval of both Development Team Leaders on such Development Team, in writing (including by email or facsimile) or by vote at a meeting of such Development Team followed by the entry of such action or decision into the minutes of such meeting
followed by the approval of such minutes by the Development Team Leaders. In the absence of such mutual approval, either Development Team Leader may, by formal written notice to the Steering Committee, declare the existence of a dispute at the
Development Team level, and thereby request that such dispute be resolved by the Steering Committee pursuant to the dispute resolution process set forth in Section 3.2(c). 

  

	 	(b)	The responsibilities of each Development Team shall include: 

  

	 	(i)	developing and submitting to the Steering Committee for approval each Development Plan and the associated overall budget for such Development Plan; 

  

	 	(ii)	developing and submitting to the Steering Committee for approval an annual budget for each Development Plan; 

  

	 	(iii)	developing and submitting to the Steering Committee for approval any appropriate updates or amendments to the Development Plan or its accompanying budgets; 

 

	 	(iv)	coordinating the activities undertaken by the Parties pursuant to the Development Plan; 

  

	 	(v)	reviewing clinical study reports and regulatory filings for Licensed Products; and 

  

	 	(vi)	taking such other actions as are expressly delegated to Development Team by the Steering Committee. 

  

	 	(c)	Members of a Development Team and the Development Team Leaders may be removed or replaced from time to time by the Party that so designated such personnel and each Party shall
promptly notify the other Party in writing of any substitution of such designating Party’s personnel. 

  

	 	(d)	Publications. The Development Team shall discuss and review proposed publications describing the specific scientific results of the Development Collaboration. BioMarin and
Serono shall treat matters of authorship of scientific abstracts, manuscripts or other publications (or presentations) in a proper collaborative spirit, giving credit where it is due. With respect to each Party’s publications and presentations,
such Party shall not submit or present any written or oral publication, any manuscript, abstract or the like which includes data or other information related to the Project Technology or Confidential Information of the other Party without first
obtaining the prior written consent of such other Party. 

  

	3.4	Commercial Team. Within sixty (60) days of the filing of an MAA, for a Licensed Product, the Steering Committee shall establish a Commercial Team for the
Licensed Product. Each 

  

 18 

	 	Commercial Team shall consist of a Commercial Team Leader from each Party and a number of members to be agreed upon by the Steering Committee. The Commercial Team will serve as a
venue for the Parties to harmonize their strategies for product positioning, to share information concerning their respective commercialization efforts with respect to the Licensed Product, to coordinate their activities in connection with medical
meetings, and to otherwise share information and coordinate strategies and activities in a manner and with a scope as may be determined by the Steering Committee. The Commercial Team shall determine the format, timing, agenda and conduct of its
meetings. The Commercial Team may, but is not required to, keep minutes of its meetings. 

  

	3.5	Removal of Members of Steering Committee, Development Team and Commercial Team. Members of the Steering Committee, a Development Team or a Commercial Team and
the Steering Committee Chairperson, Development Team Leaders or the Commercial Team Leaders may be removed or replaced from time to time by the Party that so designated such personnel and each Party shall promptly notify the other Party in writing
of any substitution of such designating Party’s personnel. 

  

	3.6	Efforts and Standards. Each Party shall use Commercially Reasonable Efforts to conduct its activities under the Development Collaboration and use personnel with
sufficient skills and experience as are required to accomplish efficiently and expeditiously activities assigned to it under the Development Plan, in compliance in all material respects with all Laws. 

  

	3.7	Development Outside of Development Plan for Phenoptin in PKU. In the event the FDA or EMEA imposes a requirement that must be completed prior to the issuance of
Regulatory Approval for Phenoptin in the treatment of PKU that is not part of an approved Development Plan and a Party is unwilling to modify the Development Plan to include such requirement, then, notwithstanding the limitations imposed by
Section 2.4, the other Party may undertake such activities at its own expense and under its own control. Upon request, the other Party will provide reasonable assistance in such efforts, at no cost to such Party. All data generated through
such development shall be Project Technology, provided, however, that any such data developed by BioMarin may only be utilized by Serono to the extent required by Regulatory Agencies. Without limiting the foregoing, Serono shall not be entitled to
use any data developed pursuant to this Section 3.7 for any other purpose. To the extent that the costs incurred by Serono related to such independent development by Serono would have been Development Costs had they been included in the
applicable Development Plan, then [****] 

  

	3.8	Books and Records. BioMarin and Serono shall maintain or cause to be maintained records in sufficient detail and in a manner that will completely and accurately
reflect all work done and results achieved in the performance of the Development Collaboration (including all data required, and in the form required under any applicable Governmental Body regulations and as directed by the Steering Committee). Each
Party shall make such records available to the other Party for inspection during regular business hours upon reasonable advance written notice of not less than three (3) Business Days. Each Party shall maintain the records of the other Party and the
information contained therein in confidence in accordance with Section 13. 

  

 19 

	3.9	Regulatory Obligations and Approvals. 

  

	 	(a)	BioMarin shall be responsible, at its own expense, for all filings with Regulatory Agencies related to a Licensed Product for an Indication prior to the Completion of Phase II for
such Licensed Product for such Indication. Following Completion of Phase II, BioMarin will be responsible for all filings with any Regulatory Agency outside the Territory and Serono will be responsible for all filings with any Regulatory Agency in
the Territory. After Completion of Phase II but prior to the issuance of Regulatory Approval by the FDA and EMEA, other than costs incurred in preparing Common Technical Documents, which will be included as Development Costs, all expenses relating
to filings with Regulatory Agencies will be borne by the Party with responsibility for such filings. For all filings following such Regulatory Approval by the FDA and EMEA, all regulatory filings will be at the sole expense of the Party responsible
for such filing. 

  

	 	(b)	The Party responsible for each filing with any Regulatory Agency shall prepare and timely file all submissions for approvals required by the applicable Regulatory Agencies for such
Licensed Product for such Indication. All regulatory submissions and approvals in the Territory shall be held by and in the name of Serono or its designees, and shall be owned by Serono, and all such regulatory documents shall be centralized and
held by Serono. All such regulatory submissions and approvals outside the Territory shall be held by and in the name of BioMarin or its designees, and shall be owned by BioMarin, and all such regulatory documents shall be centralized and held by
BioMarin. 

  

	 	(c)	Prior to submitting any MAA, the Parties, through the Development Team, shall consult and cooperate in preparing and reviewing such MAA and its content and scope. Notwithstanding
any other provision of this Agreement, whether development of a Licensed Product is under a Development Plan or conducted by either Party independently, BioMarin shall have final decision making authority for all regulatory submissions outside of
the Territory and Serono shall have final decision making authority for all regulatory submissions in the Territory. Promptly after filing, each Party shall provide the other Party with an electronic copy, if available, or a paper copy if an
electronic copy is not available, of any MAA filed by such Party. 

  

	3.10	Regulatory Meetings and Communication. For each jurisdiction in the Territory, except as provided in Section 3.9(a), Serono shall be primarily responsible for
conducting meetings and discussions related to Licensed Products with the Regulatory Agency in such jurisdiction. For each jurisdiction outside of the Territory, BioMarin shall be primarily responsible for conducting meetings and discussions related
to Licensed Products with Regulatory Agency in such jurisdiction. To the extent practicable, at least one representative of the other Party shall be given the opportunity to participate in substantive discussions and attend meetings with Regulatory
Agencies that relate to Licensed Products. The Parties shall cooperate in good faith with respect to the conduct of any inspections by any Regulatory Agency of a Party’s site and facilities related to Licensed Products, and each Party shall at
a minimum be given the opportunity to attend the summary meeting related to Licensed Products with such Regulatory Agency at the conclusion of such site inspection. Each Party shall consider the attendance of the other Party at any such regulatory
inspections, but shall not be obligated to accept the other Party’s attendance at such inspections if such attendance would result in the disclosure to the other Party of confidential information or trade secrets unrelated to the Licensed
Products. To the extent either Party has substantive written or oral communication with any Regulatory Agency relating to any Licensed Product, the Party participating in such communication shall notify the other Party and provide a copy to the
other Party of any written communication, or notes of any oral communication, as soon as reasonably practicable. Such communications shall be deemed Confidential Information of the Party responsible for such communications, subject to the terms and
conditions set forth in Section 13. 

  

 20 

	3.11	Compliance with Law and Safety Reporting. Each Party shall conduct clinical studies hereunder, and shall use, sell and distribute Licensed Products in its
respective territories in accordance with all applicable Laws. The Parties shall comply with the terms and conditions set forth in a safety reporting and data exchange agreement specifying worldwide safety reporting requirements and methods for
exchange of important safety information regarding the Licensed Product. Such safety reporting and data exchange agreement will be executed and delivered by the Parties within six (6) months of the Effective Date. The Parties shall each maintain a
safety database for the Licensed Product and any clinical studies conducted with the Licensed Product by such Party and shall submit to applicable Regulatory Agencies all required safety reports. Each Party shall also be responsible for providing
product, medical and clinical information regarding the Licensed Product to its customers. 

  

	4.	INTELLECTUAL PROPERTY; LICENSES 

  

	4.1	Ownership of Intellectual Properties. BioMarin shall own any and all intellectual property covering BioMarin IP, Serono shall own any and all intellectual
property covering Serono IP, and BioMarin and Serono shall jointly own any and all intellectual property covering Joint Project Technology, in each case subject to the licenses granted hereunder. The Parties agree that the laws and rights applicable
under United States law with respect to joint ownership of patents and inventions shall be exclusively applied to the rights and obligations arising under this Agreement. Except for the rights expressly granted in this Section 4, no right,
option or license is granted or implied to Serono or BioMarin, under any Patent or other intellectual property or to any other product, in any field, or in any geographic territory. Neither Party makes any grant of rights by implication.

  

	4.2	Development Project License. Serono hereby grants to BioMarin a worldwide, non-exclusive, royalty-free license, with right to sublicense to BioMarin’s
Affiliates and Contractors in accordance with Section 4.6, to practice and use the Serono IP solely in connection with the development of Licensed Products and to fulfill its supply obligations set forth herein. 

  

	4.3	License to Serono in the Territory. 

  

	 	(a)	Subject to the terms and conditions of this Agreement, BioMarin hereby grants to Serono a royalty-bearing license under the BioMarin IP and BioMarin’s interest in Joint Project
Technology to use, sell, offer to sell, and import each Licensed Product for each Indication solely within the Field and the Territory during the Royalty Term. 

  

	 	(b)	Serono expressly acknowledges that (i) the license granted in Section 4.3(a) includes a sublicense of certain rights licensed to BioMarin pursuant to the Existing Third Party
Agreements, and (ii) any sublicense of such rights must comply with the requirements set forth in the respective Existing Third Party Agreements regarding sublicenses granted pursuant to such Existing Third Party Agreement; provided, however, that
such acknowledgments shall not create any obligations or direct liability of Serono to the Third Party under such Existing Third Party Agreements, and BioMarin and shall use Commercially Reasonable Efforts to cause such agreements to be amended to
provide that in the event that such agreements terminate for any reason, Serono shall have the right to assume BioMarin’s rights and responsibilities thereunder. 

  

 21 

	 	(c)	Subject to BioMarin’s retained rights to practice and use the BioMarin IP and BioMarin’s interest in the Joint Project Technology solely within the scope of the
Development Collaboration and BioMarin’s supply obligations hereunder, the license set forth in Section 4.3(a) shall be exclusive (even as against BioMarin) in each country of the Territory. 

  

	4.4	Sublicenses as to Licensed Products. Subject to the terms and conditions of this Agreement, Serono shall have the right to grant sublicenses under the license
granted in Section 4.3 as to a Licensed Product for an Indication solely within the Field and the Territory during the Royalty Term of such Licensed Product; provided, however, that: 

  

	 	(a)	any such Sublicensee shall (i) affirmatively agree in writing that it is subject to and shall be governed by this Agreement, except with respect to Sections 2, 3.1-3.8, 4.2, 4.5,
4.6, 4.9, 5, 6 (with respect to portions of the Territory not included within such sublicense), 7, 8.1, 8.2, 8.5, 10, 11, 12, and 14 and that the Sublicensee shall comply with all of Serono’s obligations hereunder in
accordance herewith except with respect to Sections 2, 3.1-3.8, 4.2, 4.5, 4.6, 4.9, 5, 6 (with respect to portions of the Territory not included within such sublicense), 7, 8.1, 8.2, 8.5, 10, 11, 12, and 14, (ii) be immediately
disclosed to BioMarin in its entirety, and (iii) be subject to BioMarin’s prior written approval, such approval not to be unreasonably withheld or delayed; 

  

	 	(b)	no sublicense shall relieve Serono of any duty or obligation under this Agreement and Serono shall be fully liable to BioMarin for all failures by any Sublicensee to comply with the
terms and conditions set forth in this Agreement that apply to Sublicensees as provided in (a) above; and 

  

	 	(c)	[****] 

  

	4.5	License to BioMarin Outside the Territory. Serono hereby grants to BioMarin a royalty-free license under the Serono Project Technology and Serono’s
interest in the Joint Project Technology to make, have made, use, sell, offer to sell, and import each Licensed Product solely within the Field and outside the Territory during the Royalty Term applicable to such Licensed Product. Subject to
Serono’s development obligations hereunder, such license shall be exclusive (even as against Serono) in each country outside the Territory. 

  

	4.6	Sublicensees. Subject to the terms and conditions of this Agreement, BioMarin shall have the right to grant sublicenses under the license granted in Section
4.5; provided, however, that: 

  

	 	(a)	any such Sublicensee shall affirmatively agree in writing that it is subject to and shall be governed by this Agreement except with respect to Sections 2, 3.1-3.8, 4.3, 4.4, 4.9,
5, 6 (other than Section 6.6), 7, 8, 11, and 14, and that the Sublicensee shall comply with all of BioMarin’s obligations hereunder in accordance herewith; and 

  

	 	(b)	no Sublicensee shall relieve BioMarin of any duty or obligation under this Agreement and BioMarin shall be fully liable to Serono for all failures by any Sublicensee to comply with
the terms and conditions set forth in this Agreement. 

  

 22 

	4.7	Patent Marking; Designations. Each Party agrees to mark with notices of Patent, and to have so marked by its Affiliates and Sublicensees, each marketed Licensed
Product and all related packaging, advertising and promotional materials, in accordance with the laws of the United States or other applicable countries relating to the marketing of patented articles. Serono agrees that it will in no way alter,
deface, remove, cover up or mutilate in any manner whatsoever, any BioMarin serial or model number, the word “patent” and/or the patent number, copyright symbol, brand or name which BioMarin may attach or affix to or make a part of (or
require be attached or affixed to, or made a part of) Licensed Product packaging or advertising and promotional materials therefor, nor shall Serono permit any of its Affiliates or Sublicensees to do any of the foregoing. Subject to Laws and the
availability of sufficient space on the applicable material, Serono shall indicate on such promotional and packaging materials as reasonably requested by BioMarin: (a) for Phenoptin, that such Licensed Product is “Developed and manufactured in
collaboration with BioMarin Pharmaceutical Inc., Novato, California and Daiichi Suntory Pharma Co., Ltd., Tokyo, Japan and distributed under license” and (b) for Phenylase, that such Licensed Product is “Developed and manufactured in
collaboration with BioMarin Pharmaceutical Inc., Novato, California and distributed under license,” or such similar notices, in the case of (a) or (b) as BioMarin may reasonably request, and in such format and placement as Serono shall
reasonably determine. 

  

	4.8	Trademarks. Subject to BioMarin’s licensors’ rights in such Licensed Products, Serono shall have the right to select, register and own (and bear all
costs associated with), any and all trademarks associated with the Licensed Products within the Territory. As between the Parties, BioMarin shall have the right to select, register and own (and bear all costs associated with), any and all trademarks
associated with the Licensed Products outside the Territory. BioMarin shall transfer to Serono, at BioMarin’s expense, any and all trademarks associated with the Licensed Products that have been filed by BioMarin within the Territory, including
but not limited to “Phenoptin.” The Parties shall cooperate reasonably with each other to develop, implement and maintain a complementary trademark strategy and reasonably endeavor to select a single trademark for each Licensed Product on
a worldwide basis. If the Parties use a single trademark for a Licensed Product, they shall cooperate reasonably with each other to develop a suitable website homepage for the Licensed Product on top level domain(s), with the content and format of
any top level domain website homepage for the Licensed Product to be approved by the Parties. 

  

	4.9	Technology Transfer. Within sixty (60) days after the Effective Date, the Development Team shall prepare a plan to effectuate the transfer to Serono of BioMarin
IP (including, without limitation, and regulatory filings and clinical protocols and results) that is necessary for Serono to conduct the activities contemplated hereunder and as may be required for Serono to seek Regulatory Approvals for any
Licensed Product, and such transfer of BioMarin IP shall be completed within one hundred and twenty (120) days of the Effective Date. During the Term, BioMarin shall provide to Serono full and prompt disclosure of any new BioMarin IP, and Serono
shall provide to BioMarin full and prompt disclosure of any new Serono IP. In addition, the Parties may effect a manufacturing technology transfer as provided in Section 5.7. 

  

	5.	SUPPLY OF LICENSED PRODUCT 

  

	5.1	Supply of Licensed Product. BioMarin shall supply Supplied Product exclusively to Serono for development and commercialization in the Territory as provided in
this Section 5. BioMarin or its Contractors shall manufacture Supplied Product and sell Supplied Product to Serono and Serono shall purchase Supplied Product from BioMarin based upon firm purchase orders consistent with the terms set
forth in this Section 5. Serono shall satisfy all of its and its 

  

 23 

	 	Affiliates’ and Sublicensees’ requirements in or for the Territory for Supplied Products solely through purchases of Supplied Products from BioMarin pursuant to this
Section 5. In addition, BioMarin shall supply placebo needed by Serono and its Affiliates and Sublicensees (if any) for the conduct of Phase II and/ or Phase III Clinical Trials of the Licensed Product in any Indication. BioMarin shall also
supply Serono and its Affiliates or Sublicensees (if any) with any samples of Supplied Product required by any Regulatory Agency. 

  

	5.2	Forecasts. At the beginning of each month, Serono shall provide BioMarin with a rolling forecast for Supplied Products for the fifteen (15) month period
commencing three (3) months after the delivery of such forecast (the “Rolling Forecast”). For instance, the forecast delivered in January 2006 shall cover the period of April 2006 through June 2007. The amount
for the first month included in each Rolling Forecast shall be firm and binding on Serono and the monthly amounts for the remaining period shall be non-binding; provided that such amounts shall represent Serono’s best estimate of its
requirements for such periods, and provided, further, that BioMarin shall take into account such monthly amounts to maintain safety stocks of Supplied Product as required in Section 5.10 and use its Commercially Reasonable Efforts to ensure
that sufficient manufacturing capacity is available at BioMarin’s Contractor’s facility, such as to comply with its obligations hereunder. The first Rolling Forecast for each Licensed Product shall be provided no later than ninety
(90) days after the filing of the MAA for such Licensed Product. 

  
  

	5.3	Purchase Orders. 

  

	 	(a)	Concurrent with the delivery of each Rolling Forecast, Serono shall issue a binding purchase order (a “Purchase Order”) for the supply of Supplied Product in
quantities specified in the first month of each Rolling Forecast, and such purchase order shall specify reasonable delivery dates, and instructions for shipping and packaging the Supplied Products. If there is any inconsistency between any of the
terms and conditions of a Serono Purchase Order and the terms and conditions of this Agreement, the terms and conditions of this Agreement shall prevail. 

  

	 	(b)	Within three (3) Business Days of receiving a Purchase Order from Serono, BioMarin shall give written notice to Serono specifying the acceptance of such Purchase Order, unless the
terms of such Purchase Order are not in accordance with the provisions of Sections 5.2 and 5.3. In the event that BioMarin does not accept a Purchase Order, the Parties will promptly consult with each other to resolve the issues as
promptly as feasible and such Purchase Order will be modified accordingly. 

  

	 	(c)	If Serono requests a change to a Purchase Order (a “Change Order”) after such Purchase Order is acknowledged by BioMarin, BioMarin shall use Commercially Reasonable
Efforts to accommodate such Change Order. Notwithstanding the foregoing, Serono, by providing written notice to BioMarin, may cancel or modify any of its outstanding Purchasing Orders for Supplied Product if a recall of Supplied Product is deemed
necessary in the Territory (unless such recall results solely from an act or omission of Serono) and Serono may then modify the related forecast accordingly. In addition, Serono may cancel any outstanding Purchase Order in the event of a termination
of this Agreement. Unless such recall is due to BioMarin’s breach of this Agreement, including without limitation a breach of Section 5.5, in the event Serono cancels any Purchase Order as permitted under this Section 5.3(c),
Serono will pay BioMarin all non-cancelable Cost of Goods incurred by BioMarin in connection with such Purchase Order, provided that BioMarin will use Commercially Reasonable Efforts to mitigate such costs. 

  

 24 

	5.4	Supply Price and Standard Supply Price. 

  

	 	(a)	BioMarin shall supply Serono with requirements of Supplied Product for development and commercial purposes for all countries in the Territory and shall obtain authorization from the
FDA or other applicable Regulatory Agencies to manufacture, have manufactured, ship and export from the United States Supplied Product for all purposes in and to the European Union or Switzerland; provided that Serono shall be solely responsible for
re-exportation of Supplied Product to any other jurisdiction in the Territory. The supply price paid by Serono for Supplied Product shall be equal to [****]. BioMarin’s Cost of Goods (a) shall not [****] amounts actually paid by BioMarin
to Contractors to acquire Supplied Product and (b) shall not include any costs, including without limitation royalty or other payments due under Existing Third Party Agreements, associated with licenses or other intellectual property rights that may
be due by BioMarin to Third Parties. The Cost of Goods shall not exceed costs incurred by BioMarin (including amounts paid to Contractors) in the manufacture and supply of its own Supplied Product plus or minus incremental, documented costs incurred
in connection with the implementation of any special requirements required inside or outside the Territory, such as different packaging configurations or requirements of a Regulatory Agency. During the Term, BioMarin shall evaluate on a regular
basis the efficiency of its manufacturing, procurement and supply chain processes, and those of its Contractors, and shall use Commercially Reasonable Efforts to reduce the Cost of Goods. If Serono provides information to BioMarin that it believes
could lead to a reduction in the Cost of Goods, the Steering Committee shall consider (and if appropriate, act upon) that information within a reasonable period of time. If either Party can demonstrate that it can produce Supplied Product
internally, or that a third party can produce Supplied Product, for a savings over the current Cost of Goods of such Supplied Product, whether for backup or second sourcing purposes or for any other purposes, the Parties shall discuss such
possibility in good faith, subject to the manufacturing rights retained by Daiichi Suntory Pharma Co., Ltd. and Shiratori Pharmaceutical Co., Ltd. under the Existing Third Party Agreements. 

  

	 	(b)	Prior to December 1st of each year, BioMarin and
Serono shall agree in writing on the standard cost of goods for Supplied Product for the following calendar year. For such calendar year, BioMarin will invoice Serono, and Serono will pay BioMarin, for Supplied Product [****] for Supplied
Product shipped to Serono and its Affiliates or Sublicensees in such calendar year. Within forty-five (45) days after the end of each calendar year BioMarin shall send to Serono a report comparing its aggregate actual Cost of Goods for all Supplied
Product shipped to Serono and its Affiliates or Sublicensees and the aggregate standard cost of goods for such Supplied Product. If the aggregate actual Cost of Goods is greater than the aggregate standard cost of goods, Serono shall pay to BioMarin
[****] and if the aggregate standard cost of goods is greater than the aggregate actual Cost of Goods, BioMarin shall pay to Serono [****], in each case not later than thirty (30) days from the approval by Serono of such report.

  

	5.5	Manufacture. BioMarin shall be responsible for the manufacture of the Supplied Product and shall cause the Supplied Product to be manufactured or supplied in
accordance with the Specifications, the written manufacturing procedures, the Quality Agreement and the Laws (including regulations for shipment of the Supplied Product into the European Union and Switzerland). BioMarin and/or its Contractor(s)
shall manufacture and supply Supplied Product and Serono shall perform and be responsible for all costs associated with all labeling, secondary packaging, final release testing and similar activities required by Regulatory Agencies in the

  

 25 

	 	Territory. Unless otherwise agreed by the Parties, if Supplied Product is delivered in primary packaging, BioMarin shall not be obligated to provide more than one configuration of
primary packaging for each Licensed Product. Serono shall promptly advise BioMarin in writing of any new standards, procedures or specifications required by the applicable Regulatory Agencies in the Territory and the Parties shall confer with
respect to the best mode of compliance with such requirements. If any changes to the Specifications for the Supplied Product are required by the EMEA prior to Regulatory Approval, BioMarin shall, in supplying such Supplied Product to Serono, comply
with such changes and any costs of the Parties in making such changes shall be included as a Development Cost. If any changes to the Specifications for the Supplied Product are required by the EMEA after Regulatory Approval, BioMarin will use its
best efforts to comply with such changes and BioMarin and Serono shall each be responsible for [****] incurred by BioMarin in complying with such changes [****] and all additional costs will be the responsibility of Serono, including
all of BioMarin’s costs [****] and all costs of filings with Regulatory Agencies. BioMarin shall maintain and shall use Commercially Reasonable Efforts to cause its Contractors’ to maintain during the Term any license required by
the FDA or any other applicable Regulatory Agencies to permit the manufacture and supply of the Supplied Product hereunder in accordance with Law. BioMarin shall promptly notify Serono of, and consult with Serono regarding, any request BioMarin
receives from any government or Regulatory Agency to change the Specifications in any manner that could affect Regulatory Approvals for the Licensed Product in the Territory. BioMarin shall consult with Serono and, unless required by Law or to
address serious safety issues, receive Serono’s written approval, not to be unreasonably withheld, before applying to the FDA or any other Regulatory Agency to change the Specifications in any manner that could affect Regulatory Approvals for
the Supplied Product in the Territory. 

  

	5.6	Compliance with Forecasts; Shipping Dates. BioMarin shall ship Supplied Product on the delivery dates provided in Serono’s firm purchase orders, and Serono
shall package label and release Supplied Product promptly and efficiently so as to ensure that a sufficient supply of Licensed Product is available to commence and continue distribution of the Licensed Product in the Territory following receipt of
Regulatory Approvals. If BioMarin anticipates any delay that would result in a change to the scheduled delivery date, BioMarin will notify Serono as soon as possible, shall take all reasonable measures to deliver Supplied Product not later than the
scheduled delivery date or as soon as possible thereafter and if such delay is caused by events or circumstances beyond BioMarin’s reasonable control, all expenses associated with such measures shall be included within Cost of Goods. The
Parties agree, in the event of a shortage of Supplied Product, to apportion available Supplied Product including BioMarin’s safety stock, between Serono and its Affiliates and Sublicensees, and BioMarin and its Affiliate and Sublicensees, in
accordance with the total requirements for Supplied Product set forth in such Parties’ purchase orders and forecast, or equivalent. The Parties acknowledge that the Parties’ commercial requirements have priority over development
requirements unless otherwise determined by the Steering Committee; provided that until Serono has completed the necessary clinical trials required for the approval of the Supplied Product for PKU from the EMEA, Serono’s development
requirements related to the corresponding EMEA filing shall have equal priority with the Parties’ commercial requirements. 

  

	5.7	Technology Transfer. Upon the occurrence of any of the following events, Serono shall have the right to require BioMarin to effect a transfer of manufacturing
know-how sufficient to enable Serono, or a third party designated by Serono, to manufacture the Supplied Product in accordance with the Specifications: 

  

	 	(a)	material breach by BioMarin under this Section 5 that has not been cured within sixty (60) days after written notice of such breach is provided by Serono to BioMarin;

  

 26 

	 	(b)	if BioMarin suffers Financial Difficulty; or 

  

	 	(c)	any event that has prevented BioMarin’s or BioMarin’s Contractor(s) from shipping Supplied Products in accordance with Serono orders for three (3) months.

  

	5.8	Delivery of Supplied Product. Subject to the terms and conditions of this Agreement, BioMarin shall fill (by full or partial shipment) Serono’s orders for
Supplied Products for the Territory, F.C.A. (IncoTerms 2000) BioMarin’s or its Contractor’s facility as previously noticed to Serono, provided that notwithstanding the foregoing, title will not transfer until Supplied Products are one (1)
mile outside of United States territorial waters. To the extent BioMarin incurs any shipping charges, premiums for freight insurance, customs duties or other import or export fees, or other transportation costs in connection with shipments of
Supplied Product to Serono, BioMarin shall invoice Serono for all such charges and Serono shall promptly reimburse BioMarin for such amounts consistent with the payment terms of this Agreement. 

  

	5.9	Shelf Life. BioMarin shall deliver Supplied Product to Serono having not less than [****] of its shelf life remaining upon delivery to Serono. In addition, the Parties
acknowledge that the Development Plan for Phenoptin for PKU shall include an undertaking by BioMarin to obtain a shelf–life for Supplied Product of at least [****], and conduct related stability studies for Supplied Product packaged in its
primary packaging. 

  

	5.10	Safety Stock. At all times, BioMarin shall maintain an inventory of either unformulated active pharmaceutical ingredients or formulated Supplied Product in quantities,
reasonably established by BioMarin, that are sufficient to meet the anticipated worldwide demand for a period of no less than [****]. Serono shall maintain an inventory of Licensed Product in quantities, reasonably established by Serono, that are
sufficient to meet the anticipated demands in the Territory for a period of no less than [****]. BioMarin shall report to Serono on a quarterly basis such inventory status for Supplied Product. Such status shall include as a minimum the quantity
available of such Supplied Product. If any ingredient used to manufacture the Supplied Product has a lead time greater than [****], BioMarin shall maintain at any time an inventory of, at its option, either (i) such ingredient or (ii) unformulated
active pharmaceutical ingredient, but only if such ingredient is an ingredient involved in the manufacture of the active pharmaceutical ingredient, or (iii) Supplied Product sufficient to cover the anticipated worldwide demand for the Licensed
Product for a period of no less than [****]. In the event that the inventory required to be maintained hereunder is not maintained due to excess purchase orders by Serono pursuant to Section 5.16 or replacement of defective Supplied Product
pursuant to Section 5.15, BioMarin shall use Commercially Reasonable Efforts to restore such inventory as soon as reasonably possible; provided that such temporary reduced stock shall not be a breach of this Agreement. In the event that the
restock is due to orders pursuant to Section 5.16 or replacement of Supplied Product that is defective due to events or circumstances beyond BioMarin’s reasonable control, any additional costs associated with such restock shall be
included in Cost of Goods. In the event that the restock is due to replacement of Supplied Product that is defective due to events or circumstances within BioMarin’s reasonable control, any additional costs associated with such restock shall be
excluded from Cost of Goods. 

  

	5.11	Payment Procedures. Serono’s payment to BioMarin for the Supplied Product supplied by BioMarin shall be due in United States currency by wire transfer to a
bank account designated by BioMarin no later than thirty (30) days after the date of the invoice for such Supplied Product. Late payments arising under this Section 5 shall be subject to the late charge set forth in Section 8.2.

  

 27 

	5.12	Documentation Associated with Shipments. BioMarin (or its Contractors) will prepare comprehensive batch documentation for the production of each lot of Supplied
Product under this Agreement, in accordance with the Quality Agreement, cGMP and other instructions and Specifications that are agreed upon by the Parties and will retain such documentation pursuant to an appropriate document retention schedule that
complies with FDA and EMEA requirements. The batch documentation will be available to Serono for inspection and review. Upon Serono’s request, BioMarin will supply Serono with copies of such batch documentation, and if any batch
documentation is not provided in English, BioMarin shall provide to Serono copies of such batch documentation translated into English. Five (5) days prior to each shipment of Supplied Product, BioMarin shall send to Serono by facsimile a copy
of the detailed packing list indicating gross and net weights, invoice, airway bill number and flights details. BioMarin shall send with each shipment of Supplied Product a pro forma invoice or comparable document to be agreed with Serono containing
at least Serono’s material description and code, Serono’s purchase order number, Supplied Product batch number, manufacturing date, unit of measure and total quantity delivered. 

  

	5.13	Direct Shipment to Customers. BioMarin shall not be required to ship Supplied Product directly to a customer of Serono unless Serono first seeks and obtains
BioMarin’s prior written approval for such a shipment. 

  

	5.14	Risk of Loss. BioMarin’s obligation to ship Supplied Product shall be fully and completely discharged, and all risk of loss or damage shall immediately
pass to Serono at the time that a shipment of Supplied Product is delivered to Serono’s designated carrier consistent with Section 5.8. 

  

	5.15	Rejection. 

  

	 	(a)	Promptly upon receipt of each delivery of Supplied Product, Serono shall perform appropriate inspection procedures designed to determine whether such Supplied Product conforms at
the time of delivery to the applicable specifications therefor (such specifications to be consistent with those contained in the Regulatory Approvals in the Territory and mutually agreed upon in writing prior to the first shipment of a Supplied
Product (for each Supplied Product, the “Specifications”)). If the Supplied Product supplied by BioMarin under this Agreement fails to conform to the Specifications, Serono shall so notify BioMarin promptly after its
discovery of such non-conformity, and in any event within sixty (60) days after Serono’s receipt of the subject shipment, and Serono shall concurrently present reasonable evidence to BioMarin of such non-conformity. If Serono notifies BioMarin
that Supplied Product is non-conforming and BioMarin does not dispute such determination, BioMarin shall promptly supply Serono with replacement Supplied Product at BioMarin’s cost and expense. If subsequently, BioMarin demonstrates that any
such Supplied Product alleged to be non-conforming by Serono is confirming, Serono shall be responsible for the costs of the replacement Supplied Product. 

  

	 	(b)	In the event that BioMarin disputes the findings alleging non-conformity provided by Serono, BioMarin shall provide Serono with notice thereof within fifteen (15) days after
BioMarin’s receipt of Serono’s notice and presentation of evidence described in Section 5.15(a). BioMarin shall thereafter have an additional twenty (20) days after Serono’s receipt of such notice to perform such testing and
analysis of the Supplied Product that Serono claims to be non-conforming as BioMarin shall determine to be appropriate. Based on such testing the Parties will negotiate in good faith for a period of not more than twenty (20) days to reach a
resolution of the issue. 

  

 28 

	 	(c)	If the Parties are unable to reach a resolution within such twenty-day period, they shall agree to submit the allegedly non-conforming Supplied Product to an independent testing
laboratory acceptable to both Parties that shall be charged with determining whether or not the Supplied Product meets the Specifications. Such laboratory’s findings shall be final and binding on the Parties. If the Supplied Product meets the
Specifications, Serono shall pay for such laboratory’s costs and expenses for such testing and if the Supplied Product does not meet the Specifications, BioMarin shall pay for such costs and expenses. 

  

	 	In the event that it is determined, based on the above procedures, that the allegedly non-conforming Supplied Product was conforming, then Serono shall be responsible for payment
for any such Supplied Product. In the event that it is determined, based on the above procedures, that any Supplied Product delivered to Serono does not meet the Specifications, BioMarin shall replace promptly, at no additional expense to Serono,
such non-conforming Supplied Product with new Supplied Product that does conform with the Specifications thereof, and shall bear all costs of shipment of such new Supplied Product. BioMarin shall give Serono written instructions as to how Serono
should, at BioMarin’s expense, dispose of any non-conforming Supplied Product, and such instructions shall comply with all appropriate governmental requirements. Serono shall have no right to replacement of allegedly non-conforming Supplied
Product if such non-conformity would have been detected upon reasonable inspection when first delivered and Serono fails to identify and notify BioMarin of the non-conformity within sixty (60) days after receipt by Serono of the subject shipment.
Serono’s sole remedy resulting from BioMarin’s delivery of non-conforming Supplied Product, and BioMarin’s sole obligations with respect thereof, shall be as set forth in this Section 5.15, provided however, if any
non-conforming Supplied Product identified by Serono after such sixty (60) day period would not have been reasonably expected to have been identified upon reasonable inspection to be non-conforming, then BioMarin shall replace, promptly and at no
additional expense to Serono, any non-conforming Supplied Product with new Supplied Product that conforms to the Specifications therefor, and shall bear all of the costs of shipment of such new Supplied Product. 

  

	5.16	Supply in Excess of Forecast. Should, at any future time during the Term, Serono’s requirements for Supplied Product exceed the Rolling Forecasts, Serono
shall provide BioMarin, as soon as reasonably practicable, with written notice to this effect with a good faith indication of the total amount of such excess requirements. BioMarin shall, within thirty (30) days from the receipt of such notice,
advise Serono in writing as to BioMarin’s ability to provide such supply and shall use its Commercially Reasonable Efforts to supply such excess requirements pursuant to any firm Purchase Orders which Serono may place pursuant to Section
5.3; provided that BioMarin will not be obligated to use more than one half of the safety stock maintained by BioMarin pursuant to Section 5.10 to satisfy such additional orders. 

  

	5.17	Suppliers. Without limiting BioMarin’s responsibility under this Agreement, BioMarin shall have the right at any time to satisfy its supply obligations to
Serono hereunder, either in whole or in part, through arrangements with Contractors engaged to perform services or supply facilities or goods in connection with the manufacture, testing, and/or packaging of Supplied Product. BioMarin shall ensure
that all facilities processes and procedures of such Contractors comply with applicable regulations and cGMP standards and will give Serono written notice sufficiently in advance of any proposed arrangement or change to any arrangement to determine
whether such arrangement would require changes to an MAA filed in the Territory, and in any event, any such 

  

 29 

	 	proposal or change shall be subject to the change control procedures required by cGMP and as set forth in the Quality Agreement. BioMarin shall not make any arrangements with
Contractors that could reasonably be expected to result in an interruption in the supply of the Licensed Products to the Territory. To the extent that any such arrangements with Contractors would require any authorizations to be sought with
Regulatory Agencies in the Territory or otherwise require that changes be made to the Regulatory Approvals, then BioMarin shall not proceed with such arrangements without the prior written approval of Serono, such approval not to be unreasonably
withheld or delayed. Serono shall be responsible, at its expense, for preparing and making any requisite filings with Regulatory Agencies in the Territory and diligently seeking approvals for such change. 

  

	5.18	Quality Agreement. Within four (4) months after the Effective Date, BioMarin and Serono will enter into a Quality Agreement for Phenoptin for PKU. In the event
of a conflict between the Quality Agreement and this Agreement, this Agreement shall govern and control, unless otherwise expressly provided in the Quality Agreement. Within two (2) months prior to the anticipated initiation of a clinical trial of
any other Licensed Product, BioMarin and Serono will enter into a Quality Agreement for such other Licensed Product (or amend the existing Quality Agreement to cover such other Licensed Product). 

  

	5.19	Audit. Serono will have the right to be present when BioMarin is conducting an audit of any Contractor facility where Supplied Product is manufactured, packaged
and/or stored, provided however such right to be present shall be limited to once per Calendar Year. During normal business hours and upon reasonable advance notice, Serono will have the right to audit the facilities of BioMarin where Supplied
Products are manufactured, packaged, and/or stored, for purposes of monitoring the conditions and processes under which Supplied Product is manufactured, packaged and stored, provided, however, that any such audits of BioMarin may be performed only
once per calendar year with respect to a given facility. 

  

	6.	DISTRIBUTION OF LICENSED PRODUCT 

  

	6.1	Marketing and Distribution of Licensed Product. 

  

	 	(a)	Serono shall have sole responsibility and shall bear all costs and expenses for the promotion and distribution of Licensed Product in the Territory. 

  

	 	(b)	BioMarin shall have sole responsibility and shall bear all costs and expenses for the promotion and distribution of Licensed Product outside the Territory. 

 

	6.2	Post-Marketing Clinical Studies and Surveillance. No later than thirty (30) days after the first submission of an MAA for a Licensed Product for an Indication, the
Parties shall establish mutually acceptable liaisons, venues and processes for the coordination of their respective activities in the planning and conduct of post-marketing clinical studies and surveillance for such Licensed Product for such
Indication. Serono shall be responsible for all costs associated with the planning and conduct of post-marketing clinical studies and surveillance, and filing and maintenance of marketing authorizations in the Territory, and BioMarin shall be
responsible for all costs associated with the planning and conduct of post-marketing clinical studies and surveillance, and filing and maintenance of marketing authorizations outside the Territory. 

  

	6.3	Regulatory Diligence, Compliance with Laws. For each Licensed Product, Serono will use Commercially Reasonable Efforts to: 

  

	 	(a)	obtain Regulatory Approvals in the Territory for Licensed Products; 

  

 30 

	 	(b)	maintain appropriate quality control and quality assurance systems for the distribution of Licensed Product in the Territory; 

  

	 	(c)	comply with Laws in each jurisdiction where Licensed Products are sold; 

  

	 	(d)	comply with all applicable export laws and restrictions and regulations of the Department of Commerce or other Governmental Body, and not to export any Confidential Information or
Licensed Products in violation of any such restrictions, laws or regulations; 

  

	 	(e)	not make any claims, representations or warranties directly or indirectly to any Third Party about the Licensed Products except as permitted by Law; 

  

	 	(f)	keep records of all Licensed Product sales and customers sufficient to adequately administer a recall of any Licensed Product for five (5) years after the sale; and

  

	 	(g)	market and sell the Licensed Products on their own merits and not with the intent of promoting or encouraging the purchase or use of any other product or service.

  

	6.4	Commercial Diligence. With respect to each Licensed Product for each Indication, Serono shall use Commercially Reasonable Efforts (a) to [****]

  

	6.5	Changes to Licensed Products. Either BioMarin or Serono may propose changes to the Specifications of a Licensed Product and the Parties will discuss any such
proposed change in good faith. If the Parties are unable to agree on whether or not to implement such change: (a) BioMarin may, if it so elects, make such change, at its own expense, for such Licensed Product for sale outside the Territory; and (b)
Serono may, if it so elects request such change to such Licensed Product for sale in the Territory and, except as otherwise provided under Section 5.5, BioMarin shall use its best efforts, at Serono’s expense, to implement such change
and Serono shall have sole responsibility, at its expense, for all filings with any Regulatory Agency required by such change. 

  

	6.6	 Complaints. Serono and BioMarin shall develop a protocol for exchanging information on product complaints concerning each of the Licensed Products of
which either Party becomes aware, so as to allow each of Serono and BioMarin to comply with its regulatory obligations in the Territory and outside the Territory, respectively. At a minimum, such protocol shall provide that if a Party receives a
complaint or information regarding a Licensed Product which it would be required under Law to disclose to a Regulatory Agency, it shall promptly, but in any event not later than twenty-four (24) hours after receipt, advise the other Party in writing
of the details of such complaint or information. Promptly thereafter, each of Serono and BioMarin shall report such complaint or information to the appropriate Regulatory Agencies in the countries in the Territory and outside the Territory,
respectively, in which such Licensed Product is being commercialized, each as may be required by, and in accordance with, the appropriate laws and regulations of the relevant countries and Regulatory Agencies. Such reporting activities within

  

 31 

	 	 
the Territory shall be coordinated between the Parties where time and law permit. The Party initially receiving the complaint or information shall provide
the other Party with all available follow-up information related to such incident (including any information in such Party’s possession as may be reasonably required by the other Party to satisfy its regulatory filing obligations).

  

	6.7	Recalls. Recalls, to the extent they occur solely in the Territory shall be directed by Serono, to the extent they occur solely outside of the Territory shall
be directed by BioMarin, and to the extent that they occur both in and outside of the Territory, shall be directed by Serono and BioMarin together, and each Party shall assist the other Party promptly in any recall. If (a) a recall in the Territory
is mandated by any Regulatory Agency and not as a result of any matter covered under (b) or (c) below, then Serono shall pay its own Recall Costs, (b) a recall in the Territory is mandated by any Regulatory Agency or made by Serono and is due to the
acts or omissions of BioMarin or its Affiliates or any Third Party performing on behalf of BioMarin, or the breach by BioMarin or its Affiliates or any Third Party performing on behalf of BioMarin, of any of BioMarin’s obligations under this
Agreement, then BioMarin shall pay to Serono one hundred percent (100%) of Serono’s Recall Costs, and (c) a recall in the Territory is due to the acts or omissions of Serono or its Affiliates or any Third Party performing on behalf of Serono,
or the breach by Serono or its Affiliates or any Third Party performing on behalf of Serono, of any of Serono’s obligations under this Agreement, then Serono shall pay its own Recall Costs. In all other recall cases, each Party shall pay its
own costs and expenses incurred in connection with such recall. 

  

	7.	FINANCIAL TERMS 

  

	7.1	License Fee. As partial consideration for the rights granted to Serono under this Agreement, within ten (10) Business Days after the Effective Date, Serono
shall pay BioMarin [****]. 

  

	7.2	Milestone Payments. As partial consideration for the rights granted to Serono under this Agreement, Serono shall pay to BioMarin the following amounts (the
“Milestone Fees”) for the achievement of each applicable event: 

  

	 	(a)	PKU. For each Licensed Product for PKU, Serono shall pay to BioMarin the fees set forth in Schedule 7.2(a) hereof for each milestone described therein no later than
thirty (30) days following the first occurrence of such milestone for such Licensed Product. 

  

	 	(b)	Non-PKU Indications. For each Licensed Product for an Indication other than PKU, Serono shall pay to BioMarin [****] no later than thirty (30) days following the occurrence
of each applicable milestone event. Serono shall have no milestone payment obligations to BioMarin with respect to any additional Indications in either of the Major Indication or Minor Indication categories. 

  

	7.3	Royalties. 

  

	 	(a)	BioMarin Patent Covered Licensed Product. Subject to Section 7.3(c), for each Licensed Product that would, but for the license granted under Section 4.3,
infringe a Patent Claim of any Patent included in BioMarin IP and/or is protected by Orphan Drug Status, Serono 

  

 32 

	 	 	shall pay royalties to BioMarin on Net Sales of such Licensed Product during the applicable Royalty Term on an Indication-by-Indication and country-by-country basis at the
incremental rates (calculated pursuant to Section 7.3(d)) set forth in Schedule 7.3(a). 

  

	 	(b)	Joint Project Technology Patent Covered Licensed Product and Uncovered Licensed Product. Subject to Section 7.3(c), for each Licensed Product that does not infringe a
Patent Claim of any Patent included in BioMarin IP and is not protected by Orphan Drug Status, Serono shall pay royalties to BioMarin on Net Sales of such Licensed Product during the applicable Royalty Term on a country-by-country basis at the
incremental rates (calculated pursuant to Section 7.3(d)) set forth in Schedule 7.3(b). 

  

	 	(c)	Payments to Third Parties for Licensed Products. 

	

  

	 	(i)	In the event that either Party reasonably determines that a Third Party Agreement is required, it shall promptly notify the other Party and one Party shall be designated the lead
Party to negotiate such Third Party Agreement under the following rules: (1) if the Third Party Agreement is expected to apply (x) only outside of the Territory or (y) both within and outside the Territory, then BioMarin shall be the lead
negotiating party and if the Third Party Agreement is expected to apply only within the Territory, then Serono shall be the lead negotiating party, (2) the Party which is the lead negotiating party shall, as between the Parties, be the Party which
executes the Third Party Agreement, and (3) the Party which is the lead negotiating party shall include the other Party in the negotiations for such Third Party Agreement, if requested by the other Party. Any Third Party Agreement, negotiated by a
Party shall be subject to the prior consent of other Party, which consent shall not be unreasonably withheld or delayed, unless such Third Party Agreement applies only outside of the Territory, in which case no consent will be required.
Notwithstanding the foregoing, [****] 

  

	 	(ii)	If BioMarin is required to pay any royalty on net sales of Licensed Products in the Territory under any Existing Third Party Agreement or to pay any royalties related to net sales,
license payments, milestones or similar payments to any Third Party under any Third Party Agreement entered into by BioMarin and covering the Territory, then, [****] 

  

 33 

	 	(iii)	Serono shall pay all amounts due to any Third Party under any Third Party Agreement entered into by Serono related to the Territory. 

  

	 	(iv)	[****] all amounts that are (A) paid by Serono to BioMarin to compensate for amounts paid to a Third Party pursuant to subsection (ii) and (B) paid by Serono pursuant to subsection
(iii) shall be deducted from the royalties due BioMarin under Sections 7.3(a) and/or (b), provided that in no event shall the royalty due BioMarin be reduced, taking into account the effect of any other deduction under this Agreement,
to [****]. In the event that Serono is not able to deduct the full amount of such permitted deduction due to the [****] royalty due to BioMarin, subject at all times to BioMarin receiving a [****] royalty as described above, Serono shall be
entitled to deduct any undeducted excess amount in subsequent Calendar Quarters. 

  

	 	(d)	Calculation of Royalties; Payment Schedule. The royalty rates set forth in the attached schedules shall be calculated as a percentage of Net Sales. Although the royalties
will be payable on a country-by-country basis, for purposes of determining the applicable royalty rate, the Net Sales will be the total annual Net Sales for the entire Territory and for all Licensed Products. Within ten (10) days after the end of
each Calendar Quarter, Serono shall provide BioMarin with an estimate of the royalty payable for the preceding Calendar Quarter. All royalties payable under this Section 7.3 shall be due quarterly and no later than thirty (30) days after the
end of each Calendar Quarter in which such Net Sales occurred. Each such payment shall be accompanied by a written statement of Net Sales for the applicable Calendar Quarter on a per Licensed Product and country-by-country basis, the basis for, and
calculation of, the royalties payable hereunder, and such other information relating to Net Sales as BioMarin may reasonably request from time to time as may be necessary to comply with any reasonable request of BioMarin’s auditor, or
reasonably necessary to prepare BioMarin’s financial statements. 

  

	8.	RECORDS, REPORTING, PAYMENT AND AUDITS 

  

	8.1	Form of Payment; Currency Conversion. All monies due to BioMarin hereunder shall be paid by wire transfer or other method designated from time to time by BioMarin, in
United States Dollars to BioMarin in Novato, California, United States of America. The rate of exchange to be used shall be the applicable monthly exchange rate for converting such local currency to United States Dollars as quoted by Reuters Ltd.
prevailing on the last Business Day of the month at 3:00 p.m. C.E.T. prior to the month in which Serono records such sales and expenses in local currencies or, for those countries for which such average exchange rate is not quoted by Reuters Ltd.,
the exchange rate used by Serono for its own corporate consolidation purposes. Serono represents and covenants that such corporate consolidation exchange rate shall at all times be reasonable. 

  

	8.2	Late Payment. Without limitation on other available rights or remedies, all amounts payable under this Agreement will be subject to a late charge at the rate of
[****] not to exceed the maximum legal rate in the State of New York, from the date due through the date of payment. 

  

 34 

	8.3	Records of Development Costs and Derivation of Royalties. Both Serono and BioMarin shall keep true, accurate and complete records of revenues, deductions from
revenue, expenditures and employees’ time devoted to the collaborative effort undertaken pursuant to this Agreement and the Development Plans, such that their Development Costs shall be accurately accounted for and determined hereunder. Records
of Development Costs shall be detailed by category and by the location where such Development Costs were incurred. Serono shall keep and shall cause its Affiliates and Sublicensees to keep complete, true and accurate records for the purpose of
showing Development Costs and the derivation of all royalties payable to BioMarin under this Agreement. All such records shall be retained for a period of not less than five (5) years following the end of the calendar year to which they relate.

  

	8.4	Audits. 

  

	 	(a)	At the other Party’s request, Serono and BioMarin shall permit such records kept and maintained pursuant hereto to be audited under generally accepted auditing standards at any
time during regular business hours and upon reasonable notice, but not more often than once per calendar year for the same purposed permitted under this Section 8.4, by an independent public accountant, appointed by the auditing Party for
this purpose and reasonably acceptable to the audited Party. Such audit shall be limited to the purpose of verifying the accuracy of (i) any Development Costs paid by the other Party, or Net Sales, (ii) the Opt-In Amount, or (iii) royalties payable
under this Agreement. The independent public accountant shall report to the auditing Party and the Party under audit only its conclusions regarding the amount of the allowed costs or deductions and/or the payments due hereunder, together with
specific details regarding any discrepancies found (the “Audit Report”). Any such audit shall be at the expense of the Party requesting the same, unless the audit concludes that, with respect to the period under audit, the
Party under audit under-reported or under-paid any amounts due to, or over-reported any amounts due from, the other Party under this Agreement, or the Opt-In Amount is inaccurate, in each case by [****], in which event the Party under audit shall
pay or reimburse the auditing Party for the reasonable expenses of such audit. 

  

	 	(b)	If the independent public accountant makes a determination that any amounts to be paid or reimbursed hereunder have been incorrectly reported by the audited Party, the Party under
audit shall, within fifteen (15) days of its receipt of the Audit Report, make a payment to the other Party such that all amounts paid hereunder shall conform to the amounts so determined to be payable, together with all applicable late charges. The
Parties agree that the determination by the independent public accountant shall be final and nonnegotiable. 

  

	8.5	Taxes. If a law or governmental regulation requires withholding of taxes, said taxes shall be calculated by the Party receiving the amount on which such taxes
are levied and such taxes shall be (a) deducted from such remitted amount and (b) timely reported to the Parties and the taxing authority, and paid to the proper taxing authority, and proof of payment shall be secured and sent to the Party receiving
the amount as evidence of such payment in such form as required by the tax authorities having jurisdiction. 

  

	9.	PATENT AND TRADEMARK PROSECUTION AND ENFORCEMENT 

  

	9.1	Disclosure by Employees, Agents or Contractors. BioMarin and Serono agree that as to any employees, agents or Contractors of BioMarin and Serono presently in
their respective employ or who are hired or retained by BioMarin or Serono to perform, manage the performance of, or 

  

 35 

	 	participate in the development obligations set forth herein, BioMarin and Serono shall ensure that such employees, agents or Contractors shall promptly disclose and assign to the
Party engaging them all rights, title and interest in and to inventions, developments or improvements (whether patentable or not), conceived or reduced to practice during the performance of the Development Collaboration. Each Party shall notify the
other Party promptly of any sole or joint inventions within the Project Technology. For purposes of this Agreement, inventorship of any invention, discovery, innovation, improvement, material or information shall be determined in accordance with the
principles of United States patent law. 

  

	9.2	Patent Committee. The Parties shall form a patent committee (the “Patent Committee”) as a means to cooperate with each other in the
preparation, review, filing, prosecution, maintenance, defense and enforcement of Joint Patents as contemplated in Section 9. The Parties will endeavor to agree on a common worldwide prosecution strategy. The Patent Committee shall consist of
one representative of each Party, designated from time to time by written notice to the other Party. Each representative of the Patent Committee may be removed or replaced from time to time by the Party that so designated such representative and
each Party shall promptly notify the other Party in writing of any substitution of such designating Party’s personnel. The Patent Committee shall meet with such frequency and at such times and locations as the Patent Committee shall agree. Each
Party shall bear its own expenses associated with such meetings and the activities of the Patent Committee and each Party shall bear its own expenses incurred in providing the other Party with copies of all substantive correspondence with the U.S.
and foreign patent offices as may be required under Section 9. 

  

	9.3	Patent Prosecution and Related Activities. 

  

	 	(a)	BioMarin IP. BioMarin shall be responsible, at its sole discretion and expense, for (1) preparing, filing, prosecuting, maintaining and defending BioMarin Patents, and (2)
conducting any interference, re-examination, reissue and opposition proceedings relating to BioMarin Patents. 

  

	 	(b)	Serono IP. Serono shall be responsible, at its sole discretion and expense, for (1) preparing, filing, prosecuting, maintaining and defending Serono Patents, and (2)
conducting any interference, re-examination, reissue and opposition proceedings relating to Serono Patents. 

  

	 	(c)	Joint Project Technology. Outside the Territory, BioMarin shall be responsible, at its sole discretion and expense, for (1) preparing, filing, prosecuting, maintaining and
defending Joint Patents, and (2) conducting any interference, re-examination, reissue and opposition proceedings relating to Joint Patents. Inside the Territory, Serono shall be responsible, at its sole discretion and expense, for (1) preparing,
filing, prosecuting, maintaining and defending Joint Patents, and (2) conducting any interference, re-examination, reissue and opposition proceedings relating to such Joint Patents. Notwithstanding the foregoing, the Parties may elect to appoint
outside counsel jointly for the prosecution of Joint Patents both inside and outside the Territory, and shall in all events endeavor to establish a worldwide strategy for the prosecution, enforcement and defense of Joint Patents, and to coordinate
and harmonize their respective activities in connection therewith. 

  

	 	(d)	BioMarin’s Obligation to Keep Serono Informed. BioMarin shall regularly consult with Serono and keep Serono advised of the status of the BioMarin Patents filed inside
the Territory or Joint Patents filed outside the Territory. BioMarin specifically agrees to 

  

 36 

	 	 	provide Serono with copies of, and with sufficient time and opportunity, but in no event less than thirty (30) days, to review, comment and consult on all such Patents, all
correspondence to and from the patent offices examining such Patents, including proposed responses, interferences and oppositions. Notwithstanding anything to the contrary herein, BioMarin shall be solely responsible, at its sole discretion and
expense, for preparing, filing, prosecuting, maintaining and defending in such countries where it deems appropriate Patents within BioMarin Background Technology, and for conducting any interference, re-examination, reissue and opposition
proceedings relating to such Patents. 

  

	 	(e)	Serono’s Obligation to Keep BioMarin Informed. Serono shall regularly consult with BioMarin and keep BioMarin advised of the status of the Serono Patents filed outside
the Territory or included in Joint Patents filed inside the Territory. Serono specifically agrees to provide BioMarin with copies of, and with sufficient time and opportunity, but in no event less than thirty (30) days, to review, comment and
consult on all such Patents, all correspondence to and from the patent offices examining such Patents, including proposed responses, interferences and oppositions. Notwithstanding anything to the contrary herein, Serono shall be solely responsible,
at its sole discretion and expense, for preparing, filing, prosecuting, maintaining and defending in such countries where it deems appropriate Patents within Serono Background Technology, and for conducting any interference, re-examination, reissue
and opposition proceedings relating to such Patents. 

  

	9.4	Election Not to Prosecute. 

  

	 	(a)	Upon ninety (90) days written notice to BioMarin, Serono may elect to discontinue the prosecution of any Serono Patent filed in any country outside the Territory pursuant to
Section 9.3(b) or Joint Patent filed in any country inside the Territory pursuant to Section 9.3(c) or not to file or conduct any further activities with respect to such Patent. If Serono declines to file or, having filed, fails to
further prosecute or maintain any such Patent, or to conduct any interference, re-examination, re-issue or opposition proceedings with respect thereto, BioMarin shall have the right, but not the obligation, at its sole expense, to prepare, file,
prosecute and maintain such Patent in such country, and conduct any interference, re-examination, re-issue or opposition proceedings with respect thereto. Serono agrees to cooperate in any manner reasonably requested in connection with any such
actions by BioMarin, at the expense of BioMarin. 

  

	 	(b)	Upon ninety (90) days written notice to Serono, BioMarin may elect to discontinue the prosecution of any BioMarin Patent filed in any country inside the Territory pursuant to
Section 9.3(a) or Joint Patent filed in any country outside the Territory pursuant to Section 9.3(c) or not to file or conduct any further activities with respect to such Patent. If BioMarin declines to file or, having filed, fails to
further prosecute or maintain any such Patent, or to conduct any interference, re-examination, re-issue or opposition proceedings with respect thereto, Serono shall have the right, but not the obligation, at its sole expense, to prepare, file,
prosecute and maintain such Patent in such country, and conduct any interference, re-examination, re-issue or opposition proceedings with respect thereto. BioMarin agrees to cooperate in any manner reasonably requested in connection with any such
actions by Serono, at the expense of Serono. 

  

	9.5	Permitted Disclosures. Following a written notice from a Party hereto, the Parties shall in good faith grant each other permission, not to be unreasonably
withheld, to disclose in the specification of Joint Patents filed by such Party pursuant to this Agreement, any BioMarin IP or Serono IP necessary to support and enable claims in such Joint Patents. 

  

 37 

	9.6	Third Party Infringement. 

  

	 	(a)	Within the Territory. In the Territory, for so long as Serono’s exclusive license rights have not been terminated hereunder and subject to the rights of BioMarin’s
licensors, if any, Serono shall have the right, at its sole expense, but not the obligation, to initiate and conduct legal proceedings to enforce (i) BioMarin Patents solely against a Third Party infringing such BioMarin Patents by the manufacture,
use, sale or importation of a Licensed Product, or (ii) Joint Patents; in addition, Serono shall have the sole right, but not the obligation, to initiate and conduct legal proceedings to enforce Serono Patents. Serono shall have exclusive control
over the conduct of any such patent infringement proceedings, including the right to settle or compromise such proceedings consistent with Serono’s licenses hereunder. All expenses relating to any such proceedings, including lawyers’ fees
and costs, shall be solely borne by Serono. If Serono elects to commence an action for infringement, and BioMarin is a legally indispensable party to such action, BioMarin shall have the right to assign to Serono its right, title and interest in the
subject patent(s) or patent application(s) in lieu of joining as an indispensable party, should that be sufficient for purposes of commencing and maintaining the action. During the Term, BioMarin will endeavor to ensure that any BioMarin personnel
(as might reasonably be requested for assistance by Serono for any Third Party infringement action) shall be available to cooperate with Serono, at Serono’s request and sole expense. If Serono elects not to pursue any such legal proceeding with
respect to BioMarin Patents or Joint Patents, Serono shall notify BioMarin of Serono’s election not to pursue such legal proceeding promptly, but no later than one hundred twenty (120) days with respect to BioMarin Patents and one hundred
eighty (180) days with respect to Joint Patents after Serono becomes aware of the Third Party’s infringement and BioMarin may pursue such proceeding and shall be entitled to any recovery resulting therefrom. 

  

	 	(b)	Outside the Territory or Products Unrelated to Licensed Products. Outside the Territory, BioMarin shall have the right, at its sole expense, but not the obligation, to
initiate and conduct legal proceedings to enforce (i) Serono Patents covering the Project Technology solely against a Third Party infringing such Patents by the manufacture, use, sale or importation of a Licensed Product, or (ii) Joint Patents or
BioMarin Patents. BioMarin shall have exclusive control over the conduct of any such patent infringement proceedings, including the right to settle or compromise such proceedings. All expenses relating to any such proceedings, including
lawyers’ fees and costs, shall be solely borne by BioMarin. If BioMarin elects to commence an action for infringement, and Serono is a legally indispensable party to such action, Serono shall have the right to assign to BioMarin its right,
title and interest in the subject patent(s) or patent application(s) in lieu of joining as an indispensable party, should that be sufficient for purposes of commencing and maintaining the action. During the Term, Serono will endeavor to ensure that
any Serono personnel (as might reasonably be requested for assistance by BioMarin for any Third Party infringement action) shall be available to cooperate with BioMarin, at BioMarin’s request and sole expense. Notwithstanding the foregoing, to
the extent a Third Party is infringing any Joint Patent, Serono Patent covering the Project Technology or BioMarin Patent by the manufacture of a Licensed Product outside the Territory, and subsequently importing such Licensed Product into the
Territory, Serono will have the right, at its sole expense, to initiate and conduct legal proceeding to enforce such Patent against such Third Party infringer outside the Territory. 

  

 38 

	 	(c)	Notice. If a Party becomes aware of any suspected infringement of any Patent or learns that any Patent is infringed or misappropriated by a Third Party, or is subject to a
declaratory judgment action arising from such infringement or misappropriation, such Party shall promptly notify the other Party of all available details regarding such infringement or misappropriation. 

  

	 	(d)	Division of Recoveries. 

  

	 	(i)	Any recovery received in connection with a suit brought by Serono pursuant to Section 9.6(a)(i) shall be used first to reimburse Serono for expenses (including reasonable
attorneys’ fees) incurred by Serono. Any recovery remaining after reimbursement of Serono’s expenses shall be retained by Serono and deemed to be Net Sales, subject to the royalty fees set forth in Section 7.3. Serono shall pay the
applicable royalty fees on such amount as if such amounts had been earned during such calendar quarter. 

  

	 	(ii)	Any recovery received in connection with a suit brought by Serono or BioMarin pursuant to Section 9.6(a)(ii) or 9.6(b) shall be retained by the Party initiating such
suit. 

  

	 	(e)	No Settlement Without Consent. Neither Party shall, without the prior written consent of the other Party, enter into any settlement of any Proceeding under Sections
9.6(a), 9.6(b) or 9.6(d) above which (i) admits or concedes that any aspect of the Project Technology, the other Party’s Background Technology is invalid or unenforceable, or (ii) adversely affects the other Party’s
rights under this Agreement. 

  

	 	(f)	Cooperation. Each Party shall keep the other Party reasonably informed of the progress of any Proceeding subject to this Section 9.6 and shall cooperate reasonably
with the other Party in connection with such activities at the request and expenses of the Party involved in such Proceeding. 

  

	9.7	Third Party Actions Claiming Infringement. 

  

	 	(a)	Notice. If a Party becomes aware of any claim or action by a Third Party against either Party that claims that the Licensed Product, or its use, development, manufacture or
sale infringes such Third Party’s intellectual property rights, such Party shall promptly notify the other Party of all available details regarding such claim or action. 

  

	 	(b)	Responsible Party. To the extent that the action or claim arises in the Territory, Serono shall have the right, at its sole expense, but not the obligation, to defend such
action. To the extent that the action or claim arises outside the Territory, BioMarin shall the right, at its sole expense, but not the obligation, to defend such action. The Party with the right to defend such action shall be the
“Controlling Party.” If a Controlling Party declines or fails to assert its intention to assume such role within forty five (45) days of receipt of such notice under Section 9.7(a), then the non-Controlling
Party shall be entitled to assume such role and shall become the Controlling Party. The Controlling Party shall have the right to choose its counsel. 

  

	 	(c)	Consultation. The Controlling Party shall consult with the non-Controlling Party on all material aspects of the defense. The Parties shall reasonably cooperate with each
other in all such actions or proceedings. To the extent permitted by Law, the non-Controlling Party shall have the right to be represented in such action or proceeding by counsel of its choice. 

  

 39 

	 	(d)	Costs and Expenses. All of a Party’s expenses relating to any proceedings under this Section 9.7, including lawyers’ fees and costs, shall be solely borne by
such Party, subject to the indemnification procedures set forth in Section 12, as applicable. 

  

	 	(e)	No Settlement Without Consent. No Controlling Party shall, without the prior written consent of the non-Controlling Party, enter into any settlement of any Proceeding under
this Section 9.7 that adversely affects a Party’s rights under this Agreement. 

  

	 	(f)	Cooperation. Each Party shall keep the other Party reasonably informed of the progress of any proceeding subject to this Section 9.7 and shall cooperate reasonably
with the other Party in connection with such activities at the request and expenses of the Party involved in such proceeding. 

  

	10.	TERM AND TERMINATION 

  

	10.1	Term. This Agreement shall become effective as of the Effective Date and shall continue in full force and effect until [****] (such period hereinafter, the
“Term”). 

  

	10.2	Rights of Termination. 

  

	 	(a)	Serono’s Right of Termination. Serono may terminate this Agreement at any time, with respect to one or more of the Licensed Products by giving (i) at least prior [****]
written notice if such termination occurs prior to the commercialization of a Licensed Product, or (ii) [****] prior written notice if such termination occurs after commercialization of a Licensed Product. Upon any such termination, all existing
BioMarin Confidential Information and all other information, data, and authorizations with respect to the Licensed Product(s) shall be promptly returned or provided to BioMarin at no cost to BioMarin. 

  

	 	(b)	Material Breach. Except as set forth in this Section 10.2(b), BioMarin and Serono shall have the right to terminate this Agreement, including the licenses granted
herein, in the event that any material term or condition of this Agreement is breached by the other Party, and such breach is not remedied within a period of [****] after the non-breaching Party transmits written notice of such breach. If such
material breach is corrected within the applicable [****] period, this Agreement and the rights granted hereunder shall continue in full force and effect. If such material breach is curable but not within such [****] period, the non-breaching Party
may not terminate this Agreement for so long as the breaching Party has commenced and is proceeding with reasonable diligence to complete the curing of such breach. 

  

	 	(c)	Termination for Financial Difficulty. 

  

	 	(i)	Serono’s Financial Difficulty. All rights and licenses granted under or pursuant to this Agreement to Serono shall automatically terminate if Serono suffers Financial
Difficulty, and all rights and licenses granted under or pursuant to this Agreement by Serono to BioMarin shall remain in effect (pending BioMarin’s 

  

 40 

 election as licensee) and are, and shall otherwise be deemed to be, for purposes of Section 365(n) of
the United States Bankruptcy Code, as amended from time to time (the “Bankruptcy Code”), licenses of rights to “intellectual property” as defined under Section 101 of the Bankruptcy Code. The Parties agree that
BioMarin, as a licensee of such rights under this Agreement, shall retain and may fully exercise all of its rights and elections under the Bankruptcy Code. 
  

	 	(ii)	BioMarin’s Financial Difficulty. All rights and licenses granted under or pursuant to this Agreement to BioMarin shall automatically terminate if BioMarin suffers
Financial Difficulty, and all rights and licenses granted under or pursuant to this Agreement by BioMarin to Serono shall remain in effect (pending Serono’s election as licensee) and are, and shall otherwise be deemed to be, for purposes of
Section 365(n) of the Bankruptcy Code, licenses of rights to “intellectual property” as defined under Section 101 of the Bankruptcy Code. The Parties agree that Serono, as a licensee of such rights under this Agreement, shall retain and
may fully exercise all of its rights and elections under the Bankruptcy Code. 

  

	10.3	Termination For Cause. Any termination pursuant to Sections 10.2(b) or 10.2(c) shall be deemed a termination for
“Cause”. 

  

	10.4	Effect of Termination. 

  

	 	(a)	Except if this Agreement is terminated by Serono pursuant to Section 10.2(a), for Cause by BioMarin or upon Serono’s Financial Difficulty pursuant to Section
10.2(c), upon expiration of the Royalty Term of a Licensed Product in a country in the Territory, all rights licensed hereunder solely as to such Licensed Product and country shall become irrevocable and fully-paid upon payment of any amounts
due that have accrued hereunder prior to expiration, except (i) in such countries where restricted by applicable law or (ii) for all intellectual property that BioMarin does not own and to which it does not have a royalty-free license.

  

	 	(b)	If this Agreement is terminated, except upon BioMarin’s Financial Difficulty pursuant to Section 10.2(c) or by Serono for Cause, all rights licensed hereunder to
BioMarin shall become, irrevocable, and fully-paid, except (i) in such countries where restricted by applicable law or (ii) for all intellectual property that Serono does not own. 

  

	 	(c)	Serono shall ensure that all registration, regulatory and reimbursement approvals for each country in the Territory and all trademarks that are substantially similar to
BioMarin’s trademarks associated with the Licensed Products are assigned back and sole ownership transferred to BioMarin promptly upon termination of Serono’s distribution rights with respect to any Licensed Product in such country to the
extent permitted by applicable laws. If such assignment and transfer of particular approvals and trademarks to BioMarin is not permitted by applicable laws, Serono shall automatically and without any action on the part of either Party grant an
exclusive (even as against Serono), royalty-free license to BioMarin to use such approvals for any purpose and such trademarks in connection with the marketing and distribution of the Licensed Products. 

  

	10.5	Accrued Rights. Expiration or termination of this Agreement shall not affect the Parties’ rights and obligations that have accrued as of the expiration or
termination date, including the Parties’ obligations to bear Development Costs incurred prior to the effectiveness of the expiration or 

  

 41 

 termination and their obligations with respect to royalties or Milestone Fees hereunder that have accrued
prior to the effectiveness of the expiration or termination. Any right to terminate this Agreement shall be in addition to and not in lieu of all other rights or remedies that the Party giving notice of termination may have at law, in equity or
otherwise, including rights under the Bankruptcy Code. 
  

	10.6	Sublicensees. From time to time, Serono may request that a sublicense granted to a Sublicensee under Section 4.4 survive termination of this Agreement.
BioMarin may approve or reject such request in its sole and absolute discretion. 

  

	10.7	Survival. Sections 1, 4.1, 4.7, 8, 10.4, 10.5, 10.6, 10.7, 11.3, 11.4, 12.1, 12.2, 12.3, 13 and 14, and all then-outstanding payment and
reimbursement obligations shall survive any termination or expiration of this Agreement. 

  

	11.	REPRESENTATIONS AND WARRANTIES 

  

	11.1	Representations, Warranties and Covenants of Serono. Serono represents and warrants to BioMarin as follows: 

  

	 	(a)	it is a corporation duly organized, validly existing and in good standing under the laws of Switzerland; 

  

	 	(b)	it has full corporate power and authority to execute and deliver this Agreement and to perform its obligations and consummate the transactions contemplated hereby. All corporate
acts and other proceedings required to be taken to authorize such execution, delivery, performance and consummation have been duly and properly taken and obtained; 

  

	 	(c)	this Agreement has been duly executed and delivered by Serono and constitutes the legal, valid and binding obligations of Serono enforceable against Serono in accordance with its
terms; 

  

	 	(d)	no approval, authorization, consent or other order or action of or filing with any Governmental Body is required for the execution and delivery by Serono of this Agreement, the
performance by Serono of its obligations hereunder or the consummation by Serono of the transactions contemplated hereby (other than Regulatory Approvals as contemplated hereby); 

  

	 	(e)	none of the execution, delivery or performance of this Agreement by Serono (i) conflicts with or results in a breach under the charter documents of Serono, (ii) conflicts with or
results in a violation of any of the laws of the jurisdiction of incorporation of Serono, or (iii) conflicts with any agreement, instrument or understanding to which it is a party or by which it is bound; 

  

	 	(f)	the granting by Serono of the licenses set forth herein and the performance by Serono of the activities contemplated herein shall not infringe any registered trademark or copyright,
or issued patent that is registered or issued on or before the Effective Date, or any trade secret right of any Third Party; and 

  

	 	(g)	Serono specifically disclaims any guarantee that the Development Collaboration will be successful, in whole or in part. Serono does not make any representation or warranty or
guaranty that the Development Collaboration will be sufficient for the successful completion of the research. 

  

 42 

	 	(h)	EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, SERONO MAKES NO REPRESENTATIONS AND EXTENDS NO WARRANTIES OR CONDITIONS OF ANY KIND, EITHER EXPRESS OR IMPLIED, WITH
RESPECT TO THE LICENSED PRODUCTS INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, VALIDITY OF SERONO IP, WHETHER PATENTED OR UNPATENTED, OR NON-INFRINGEMENT OF THE INTELLECTUAL PROPERTY RIGHTS OF THIRD
PARTIES. 

  

	11.2	Representations, Warranties and Covenants of BioMarin. BioMarin represents and warrants to Serono as follows: 

  

	 	(a)	it is a corporation duly organized, validly existing and in good standing under the laws of Delaware; 

  

	 	(b)	it has full corporate power and authority to execute and deliver this Agreement and to perform its obligations and consummate the transactions contemplated hereby. All corporate
acts and other proceedings required to be taken to authorize such execution, delivery, performance and consummation have been duly and properly taken and obtained; 

  

	 	(c)	this Agreement has been duly executed and delivered by BioMarin and constitutes the legal, valid and binding obligation of BioMarin enforceable against BioMarin in accordance with
its terms; 

  

	 	(d)	no approval, authorization, consent or other order or action of or filing with any Governmental Body is required for the execution and delivery by BioMarin of this Agreement, the
performance by BioMarin of its obligations hereunder or the consummation by BioMarin of the transactions contemplated hereby (other than Regulatory Approvals as contemplated hereby); 

  

	 	(e)	none of the execution, delivery or performance of this Agreement by BioMarin (i) conflicts with or results in a breach under the charter documents of BioMarin, (ii) conflicts with
or results in a violation of any of the laws of the jurisdiction of incorporation of BioMarin, or (iii) conflicts with any agreement, instrument or understanding to which it is a party or by which it is bound; 

  

	 	(f)	the granting by BioMarin of the licenses set forth herein and, to BioMarin’s Knowledge, the performance by BioMarin of the activities contemplated herein shall not infringe any
registered trademark or copyright, or issued patent that is registered or issued on or before the Effective Date, or any trade secret right of any Third Party; 

  

	 	(g)	as of the Effective Date, BioMarin has not conveyed or licensed, and will not convey or license during the term of this Agreement, to a Third Party any right, title, or interest in,
to or under any BioMarin IP which conflicts with any rights and licenses granted to Serono under this Agreement; 

  

 43 

	 	(h)	to BioMarin’s Knowledge, as of the Effective Date: 

  

	 	(i)	except as provided on Schedule 11.2(h)(i), there are no pending or granted patent claims of any Third Party that could cover the use, manufacture, sale, or importation of
Phenoptin for PKU within the Territory; 

  

	 	(ii)	except as provided on Schedule 11.2(h)(ii), there are no pending or granted patent claims of any Third Party that could cover the use, manufacture, sale, or importation of
Phenylase for PKU within the Territory; 

  

	 	(iii)	except as provided on Schedule 11.2(h)(iii), there are no pending or granted patent claims of any Third Party that could cover the use, manufacture, sale, or importation of
Phenoptin for an Indication other than PKU within the Territory; and 

  

	 	(iv)	except as provided on Schedule 11.2(h)(iv), there are no pending or granted patent claims of any Third Party that could cover the use, manufacture, sale, or importation of
Phenylase for an Indication other than PKU or HPA within the Territory; 

  

	 	(i)	as of the Effective Date, BioMarin has not received any written notice of a Claim that an issued patent or other intellectual property of a Third Party would be infringed or
misappropriated by the manufacture of a Licensed Product or the development or commercialization of a Licensed Product; 

  

	 	(j)	as of the Effective Date and to BioMarin’s Knowledge, BioMarin’s Patents licensed under this Agreement are not subject to any pending or threatened reexamination,
opposition, interference, or litigation proceeding; 

  

	 	(k)	BioMarin has the right to grant the licenses provided in this Agreement and the BioMarin IP is free and clear of any liens, charges, or encumbrances which would conflict with any
rights granted to Serono under this Agreement, subject to liens in the ordinary course on all of BioMarin’s assets and properties held by BioMarin’s existing debt holders; 

  

	 	(l)	the Existing Third Party Agreements are the only agreements entered into before the Effective Date between BioMarin and a Third Party under which BioMarin is granted a license under
or is assigned any of such Third Party’s Patents that claim, or Know-How that is actually used in connection with, a Licensed Product or the manufacture thereof; 

  

	 	(m)	as of the Effective Date, the Existing Third Party Agreements are, to BioMarin’s Knowledge, in full force and effect in accordance with their terms, and BioMarin is not in
breach of any of the Existing Third Party Agreements and has not received notice from any party to any of the Existing Third Party Agreements that it is in breach of any such Existing Third Party Agreement and to BioMarin’s Knowledge, no other
party to any of the Existing Third Party Agreements is in breach thereof; 

  

	 	(n)	BioMarin has provided Serono with a true, correct, and complete copy of each of the Existing Third Party Agreements; 

  

 44 

	 	(o)	as of the Effective Date and to BioMarin’s Knowledge, the BioMarin Patents have been filed, prosecuted and maintained at the respective patent offices in all material respects
in accordance with Law; 

  

	 	(p)	to BioMarin’s Knowledge, other than projections, estimates and other forward looking information or data (which at the time delivered represented BioMarin’s good faith
estimates), no information or data, whether written, visual or oral, that was provided by BioMarin to Serono prior to the Effective Date in contemplation of this Agreement, contained any untrue statement of a material fact (whether material
individually or in the aggregate taking into account other facts), nor omitted to state any material fact necessary to make such information or data not misleading (whether material individually or in the aggregate taking into account other facts)
except for such information as was subsequently updated or corrected prior to the Effective Date by further disclosure by BioMarin to Serono; and 

  

	 	(q)	BioMarin shall not amend or waive any of its rights under any of the Existing Third Party Agreements in any manner that would materially and adversely affect Serono’s rights
and benefits under this Agreement. 

  

	11.3	Disclaimer. 

  

	 	(a)	BioMarin specifically disclaims any guarantee that the Development Collaboration will be successful, in whole or in part. BioMarin does not make any representation or warranty or
guaranty that the Development Collaboration will be sufficient for the successful completion of the research. 

  

	 	(b)	EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, BIOMARIN MAKES NO REPRESENTATIONS AND EXTENDS NO WARRANTIES OR CONDITIONS OF ANY KIND, EITHER EXPRESS OR IMPLIED, WITH
RESPECT TO THE LICENSED PRODUCTS INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, VALIDITY OF BIOMARIN IP, WHETHER PATENTED OR UNPATENTED, OR NON-INFRINGEMENT OF THE INTELLECTUAL PROPERTY RIGHTS OF
THIRD PARTIES. 

  

	11.4	Limited Liability. IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF ITS
PERFORMANCE OR NON-PERFORMANCE OF THIS AGREEMENT OR THE DEVELOPMENT OR USE OF, INABILITY TO USE, OR RESULTS OF SUCH DEVELOPMENT OR USE OF ANY LICENSED PRODUCT, OR OTHERWISE RELATING TO THE LICENSED PRODUCTS, OR FOR ANY MATTER BEYOND SUCH
PARTY’S REASONABLE CONTROL. THESE LIMITATIONS SHALL (A) APPLY NOTWITHSTANDING ANY FAILURE OF THE ESSENTIAL PURPOSE OF ANY REMEDY ARISING UNDER THIS AGREEMENT AND (B) NOT APPLY TO EITHER PARTY’S OBLIGATIONS UNDER SECTION 12 AND ANY
BREACH OF A PARTY’S OBLIGATIONS UNDER SECTION 13. 

  

	12.	INDEMNIFICATION; INSURANCE 

  

	12.1	Serono Indemnification. Serono shall indemnify and hold harmless, pursuant to the provisions of this Section 12, BioMarin and each of its officers,
directors, employees, agents and Affiliates 

  

 45 

 (collectively, the “BioMarin Indemnitees”), from and against, and will reimburse
each such BioMarin Indemnitee with respect to, any and all Third Party claims, actions, demands, losses, damages, liabilities, costs and expenses to which such BioMarin Indemnitee may become subject, including reasonable fees and disbursements of
counsel and expenses of reasonable investigation (collectively, “BioMarin Losses”), arising out of, based upon or caused by: [****] 
  

	12.2	BioMarin Indemnification. BioMarin shall indemnify and hold harmless, pursuant to the provisions of this Section 12, Serono and each of its officers,
directors, employees, agents and Affiliates (collectively, the “Serono Indemnitees”), from and against, and will reimburse each such Serono Indemnitee with respect to, any and all Third Party claims, actions, demands, losses,
damages, liabilities, costs and expenses to which such BioMarin Indemnitee may become subject, including reasonable fees and disbursements of counsel and expenses of reasonable investigation (collectively, “Serono Losses”),
arising out of, based upon or caused by: [****] 

  

	12.3	Indemnification Procedures. Each Party, on behalf of itself and its respective BioMarin Indemnitees or Serono Indemnitees (each such Person, an
“Indemnitee”), agrees to provide the indemnifying Party prompt written notice of any action, claim, demand, discovery of fact, proceeding or suit (collectively, a “Claim”) for which such Indemnitee
intends to assert a right to indemnification under this Agreement; provided, however, that failure to give such notification shall not affect each applicable Indemnitee’s entitlement to indemnification (or the corresponding
indemnifying Party’s indemnification obligations) hereunder except to the extent that the indemnifying Party shall have been prejudiced as a result of such failure. The indemnifying Party shall have the initial right (but not obligation) to
defend, settle or otherwise dispose of any Claim for which an Indemnitee intends to assert a right to indemnification under this Agreement as contemplated in the preceding sentence if, and for so long as, the indemnifying Party has recognized in a
written notice to the Indemnitee provided within thirty (30) days of such written notice its obligation to indemnify the Indemnitee for any BioMarin Losses or Serono Losses (as the case may be) relating to such Claim; provided,
however, that if the indemnifying Party assumes control of the defense, settlement or disposition of a Claim, the indemnifying Party shall obtain the written consent of each applicable Indemnitee prior to ceasing to defend, settling or
otherwise disposing of the Claim. If the indemnifying Party fails to state in a written notice during such thirty (30) day period its willingness to assume the defense of such a Claim, the BioMarin Indemnitee(s) or Serono Indemnitee(s), as the case
may be, shall have the right to defend, settle or otherwise dispose of such Claim, subject to the applicable provides of Sections 12.1 and 12.2. 

  

 46 

	12.4	Insurance. 

  

	 	(a)	From and after the commencement of Phase III Clinical Trials for any Licensed Product, each of BioMarin and Serono shall obtain and maintain in effect, in a form and with insurers
reasonably acceptable to the other Party hereto (or if self-insured, to the other Party’s reasonable satisfaction with such self insurance), and which shall name the other Party as an additional insured: 

  

	 	(i)	commercial general liability insurance with a minimum limit of indemnity of Ten Million U.S. Dollars (US$10,000,000) per occurrence and in the aggregate; 

 

	 	(ii)	clinical trial liability insurance with a minimum limit of indemnity of Ten Million U.S. Dollars (US$10,000,000) per occurrence and in the aggregate, which insurance must meet all
regulations of the countries where the clinical trials will take place, including with respect to the coverage limits if greater than the one set above; and 

  

	 	(iii)	product liability insurance with a minimum limit of liability of Twenty Million U.S. Dollars (US$20,000,000) per occurrence and in the aggregate. 

  
 It is understood that such insurance shall not be construed to limit a
Party’s liability with respect to such indemnification obligations. 
  

	 	(b)	Each Party shall provide to the other Party upon request a certificate evidencing the insurance such Party is required to obtain and keep in force under this Section 12.4.
Such certificate shall provide that such insurance shall not expire or be cancelled or modified without at least thirty (30) days’ prior written notice to the other Party. 

  

	13.	CONFIDENTIALITY 

  

	13.1	Confidentiality. Except to the extent expressly authorized by this Agreement, each Party (a “Receiving Party”) agrees that, for the
duration of this Agreement and for five (5) years thereafter, it shall keep confidential and shall not publish or otherwise disclose and shall not use for any purpose other than as provided for in this Agreement any Confidential Information
furnished to it by or on behalf of the other Party (the “Disclosing Party”) pursuant to this Agreement or the Confidentiality Agreement entered into by the Parties dated April 19, 2004, unless the Receiving Party can
demonstrate by written evidence that such Confidential Information: 

  

	 	(a)	was already known to the Receiving Party, other than under an obligation of confidentiality, at the time of disclosure by the Disclosing Party; 

  

	 	(b)	was generally available to the public or otherwise part of the public domain at the time of its disclosure to the Receiving Party; 

  

	 	(c)	became generally available to the public or otherwise part of the public domain after its disclosure and other than through any act or omission of the Receiving Party or any agent,
employee or representative thereof in breach of this Agreement, or any Third Party in breach of any obligation of confidentiality; or 

  

 47 

	 	(d)	was disclosed to the Receiving Party, other than under an obligation of confidentiality to a Third Party, by a Third Party. 

  

	13.2	Authorized Disclosure. Each Party may disclose Confidential Information belonging to the other Party to the extent such disclosure is reasonably necessary in
the following situations: 

  

	 	(a)	regulatory filings, including filings with the Securities and Exchange Commission; 

  

	 	(b)	prosecuting or defending litigation between the Parties; 

  

	 	(c)	complying with applicable governmental regulations in accordance with this Agreement; 

  

	 	(d)	conducting pre-clinical or clinical trials of a Licensed Product in accordance with this Agreement; and 

  

	 	(e)	any filing of patent applications relating to a Licensed Product. 

  
 Notwithstanding the foregoing, the Party disclosing the Confidential Information of the other Party hereunder shall make reasonable efforts to obtain
agreement in writing that such Parties to whom said information is disclosed shall maintain the information in strict confidence. In the event a Party is required to make a disclosure of the other Party’s Confidential Information pursuant to
this Section 13.2, it will, except where impracticable, give reasonable advance notice to the other Party of such disclosure and use its reasonable commercial efforts to secure confidential treatment of such information. In any event, the
Parties agree to take all reasonable action to avoid disclosure of Confidential Information hereunder. 
  

	13.3	Employees; Agents. The Parties shall ensure that each of its and its Affiliates’ respective employees, consultants or other agents who has access to
Confidential Information is bound to obligations of confidentiality and non-use at least equivalent in scope and protection to those set forth in Sections 13.1 and 13.2. Each Party shall be responsible for the breach of any and all
obligations of its employees, agents and representatives as contemplated by the preceding sentence. 

  

	13.4	Injunctive Relief. The Receiving Party hereby agrees that in the event of any breach of any of the provisions of this Agreement by the Receiving Party, the Disclosing
Party may suffer irreparable harm and that monetary damages would not be a sufficient remedy for such breach, and without prejudice to any rights and remedies otherwise available to the Disclosing Party at law or in equity, the Disclosing Party
shall be entitled to equitable relief, including an injunction and specific performance without the need to prove actual damages and without the requirement to provide any bond or other security in connection with any such injunction. Each Party
hereby irrevocably and unconditionally consents to submit to the exclusive jurisdiction of the courts of the United States of America located in the borough of Manhattan, New York, New York for any actions, suits or proceedings arising out of or
relating to this Section 13; and each Party further agrees not to commence any action, suit or proceeding related thereto except in such courts. Each Party hereby irrevocably and unconditionally waives any objection to the laying of venue of
any action, suit or proceeding arising out of or relating to this Section 13 in the courts of the United States of America located in the borough of Manhattan, New York, New York, and hereby further irrevocably and unconditionally waives and
agrees not to plead or claim in any such court that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum. 

  

 48 

	14.	MISCELLANEOUS 

  

	14.1	Entire Agreement. This Agreement, together with all of the Exhibits and Schedules hereto, constitutes the entire agreement between the Parties and supersedes
all prior and contemporaneous oral and written agreements, understandings or arrangements relating to the subject matter hereof, including, without limitation, the Term Sheet and all other proposal materials. 

  

	14.2	Controlling Law; Venue. 

  

	 	(a)	This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to the doctrine of conflict of laws, except that the
issues of patentability, validity, enforceability and scope of any Patents shall be determined according to the patent laws of the Patent Country of such Patents. 

  

	 	(b)	Any legal action or other legal proceeding relating to this Agreement or the enforcement of any provision of this Agreement must be brought or otherwise commenced solely and
exclusively in courts of competent jurisdiction located in the borough of Manhattan, New York, New York. Consistent with the preceding sentence, each of the Parties: 

  

	 	(i)	expressly and irrevocably consents and submits to the jurisdiction of the courts of competent jurisdiction in the borough of Manhattan, New York, New York (and each appellate court
located in the State of New York) in connection with any such legal proceeding; 

  

	 	(ii)	expressly agrees that the courts of competent jurisdiction in the borough of Manhattan, New York, New York shall be deemed to be a convenient forum; and 

  

	 	(iii)	expressly agrees not to assert (by way of motion, as a defense or otherwise), in any such legal proceeding commenced in the courts of competent jurisdiction in the borough of
Manhattan, New York, New York, any claim that such Party is not subject personally to the jurisdiction of such Court, that such legal proceeding has been brought in an inconvenient forum, that the venue of such proceeding is improper or that this
Agreement or the subject matter of this Agreement may not be enforced in or by such Court. 

  

	14.3	Notices. All notices, reports and other communications by BioMarin or Serono to the other shall be (a) in writing and (b) sent by facsimile transmission for
which a confirmation of delivery is obtained or by express courier services providing evidence of delivery, in each case to the respective address specified below (or to such updated address as may be specified in writing in accordance herewith to
the other Party from time to time). 

  
 If to
Serono: 
  
 Ares Trading S.A. 
 Zone Industrielle de l’Ouriettaz 
 1170
Aubonne 
 Switzerland 
 Facsimile: 41 22 345 5081 
 Attention: General Manager 
  
  

 49 

 with a copy (which shall not constitute notice): 
  
 Serono International S.A. 
 15bis, chemin des Mines 
 Case postale 54

 1211 Genève 20 
 Switzerland 
 Facsimile: 41 22 739 3070 
 Attention: General Counsel 
  
 If to BioMarin: 
  
 BioMarin Pharmaceutical Inc.

 105 Digital Drive 
 Novato,
California 94949 
 Facsimile: (415) 382-7889 
 Attention: Chief Executive Officer 
  
 with copies (which copies shall not constitute notice) to: 
  
 BioMarin Pharmaceutical Inc. 
 105 Digital Drive 
 Novato, California 94949 
 Facsimile: (415) 382-7889 
 Attention: Corporate Counsel 
  
 Paul, Hastings, Janofsky & Walker LLP 
 515 South Flower Street, 25th Floor 
 Los Angeles, California 90071 
 Facsimile: (213) 627-0705 
 Attention:
Siobhan McBreen Burke, Esq. 
  
 Such notice, report or other
communication will be deemed effective as of the date so delivered either by courier service or by electronic or facsimile transmission. 
  

	14.4	Publicity. The Parties agree to keep the existence of this Agreement, the terms and conditions hereof, the transactions contemplated hereby, and any proposed
termination hereof strictly confidential; provided, however, that: 

  

	 	(a)	the Parties shall make an initial public announcement as to the Agreement in a form mutually agreed by them, and, except for any disclosure under (b) or (c), prior to making any
subsequent public announcements regarding this Agreement or the transactions contemplated herein, each Party agrees to provide the other Party with a reasonable opportunity to review and comment upon such proposed announcement;

  

	 	(b)	BioMarin and Serono may disclose the terms and conditions of this Agreement to assert or enforce such Party’s rights under this Agreement, or to the extent that such disclosure

  

 50 

 is required by Law or legal process, including without limitation the securities and antitrust laws of
the United States, and the Parties acknowledge and agree that the determination that a disclosure is required by Law shall be made in the sole, but reasonably exercised, discretion of the Party making such disclosure; and 
  

	 	(c)	if reasonably required in connection with the conduct of their respective businesses, BioMarin and Serono may disclose the existence or terms of this Agreement to bankers, other
business associates and potential investors if such persons have agreed in writing to keep the information confidential, and upon the request of either Party, the other Party shall identify those Third Parties to whom such disclosure has been made.

  

	14.5	Use of Names, Trade Names and Trademarks. Except as provided herein, nothing contained in this Agreement shall be construed as conferring any right on either
Party to use in advertising, publicity or other promotional activities any name, trade name, trademark or other designation of the other Party hereto or of any of its licensors under any Third Party Agreement or Existing Third Party Agreement,
including any contraction, abbreviation or simulation of any of the foregoing, unless the prior written consent of such other Party is obtained. 

  

	14.6	Accounting Procedures. Each Party shall calculate all amounts hereunder and perform other accounting procedures required hereunder and applicable to it in
accordance with either (a) GAAP or (b) the conventions, rules and procedures promulgated by the International Accounting Standards Committee (International Accounting Standards), whichever is normally used by such Party to calculate its financial
position, and in each case consistently applied, including consistently applied throughout the organization and across all products of such Party. To the extent necessary, any statement prepared in accordance with International Accounting Standards
shall contain a reconciliation of all material line items to the most comparable GAAP presentation. In calculating the Cost of Goods, Development Costs, or Allocable Overhead under this Agreement, all costs and expensed relating to stock options or
stock grants shall be excluded. 

  

	14.7	Force Majeure. If either Party hereto is prevented from carrying out its obligations under this Agreement by events beyond its reasonable control, including
acts or omissions of the other Party, acts of God or government, natural disasters or storms, fire, political strife, terrorism, failure of delay or transportation, default by suppliers or unavailability of raw materials, then such Party’s
performance of its obligations hereunder shall be excused during the period of such events and for a reasonable period of recovery thereafter, and the time for performance of such obligations shall be automatically extended for a period of time
equal to the duration of such events; provided, however, that the Party claiming force majeure shall promptly notify the other Party of the existence of such force majeure, shall use commercially reasonable efforts to avoid or remedy such force
majeure and shall continue performance hereunder with the utmost dispatch whenever such force majeure is avoided or remedied. When such circumstances arise, the Parties shall discuss what, if any, modification of the terms of this Agreement may be
required in order to arrive at an equitable solution. 

  

	14.8	Assignment. Except as provided below, neither Party may transfer or assign this Agreement or any part thereof, directly, by operation of law, or otherwise, without the
other Party’s prior written consent. Either Party may assign or transfer this Agreement or any of its rights or obligations under this Agreement, in whole or in part, without the consent of the other Party (a) to any Affiliate, or (b) to any
Third Party with which it merges or consolidates, or to which it transfers all or substantially all of its assets to which this Agreement relates. This Agreement shall be binding upon and shall inure to the benefit of the Parties’ respective
successors and permitted assigns. Any attempted transfer or assignment in violation of the foregoing will be null and void. 

  

 51 

	14.9	Amendments and Waivers. No terms or provisions of this Agreement shall be varied or modified by any prior, contemporaneous or subsequent statement, conduct or
act of either of the Parties, whether oral or written, except that the Parties may amend this Agreement by written instrument specifically referring to this Agreement. No waiver of any right or remedy hereunder shall be effective unless in a writing
signed by the Party to be bound, nor shall any waiver in one instance constitute a waiver of the same or any other right or remedy in any other instance. 

  

	14.10	Severability. If any provision of this Agreement is held by a court of competent jurisdiction to be invalid or unenforceable, it shall be modified, if possible,
to the minimum extent necessary to make it valid and enforceable or, if such modification is not possible, it shall be stricken and the remaining provisions shall remain in full force and effect. 

  

	14.11	Undertakings of Affiliated Companies. Serono shall have the right to have any of its obligations hereunder performed by any of its Affiliates and the
performance of such obligations by any such Affiliate(s) shall be deemed to be performance by Serono; provided, however, Serono shall be responsible for ensuring the performance of its obligations under this Agreement and that any failure of any
Affiliate performing obligations of Serono hereunder shall be deemed to be a failure by Serono to perform such obligations. Serono shall ensure, to the extent Commercially Reasonable Efforts to complete any of its obligations hereunder require such
obligation be performed by an Affiliate, that Serono delegate such obligations to such Affiliate. 

  

	14.12	Approvals. Unless expressly required not to be withheld unreasonably, it is understood that when approval of either Party is required, such approval may be
given or withheld in such Party’s sole and absolute discretion, without regard to the reason or basis for granting or withholding such consent. 

  

	14.13	Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, and all of such counterparts taken together shall
constitute one and the same instrument. 

  

	14.14	Independent Contractor. The Parties acknowledge and agree that Serono is an independent contractor and not an agent, employee, franchisee or partner of
BioMarin. Nothing in this Agreement shall constitute or be deemed to constitute either Party as the legal representative or agent of the other, nor shall either Party have any authority to incur, create or assume any liability or any other
obligation, express or implied, in the name of or on behalf of the other Party. Each Party shall be responsible for all taxes and payments concerning such Party, its employees or its sales representatives. This Agreement does not create or evidence
any joint venture or partnership of the Parties. 

  

	14.15	Interpretation. 

  

	 	(a)	The English language of this Agreement shall govern any interpretation of or dispute regarding this Agreement. 

  

	 	(b)	Any reference in this Agreement to a Section or Exhibit is a reference to the Sections and Exhibits of this Agreement unless the context requires otherwise. Any reference to a
Section shall be deemed to include a reference to any subsidiary Sections. 

  

 52 

	 	(c)	The captions of the Sections are included for reference purposes only and are not intended to be a part of the Agreement or in any way to define, limit or describe the scope or
intent of the particular provision to which they refer. 

  

	 	(d)	Whenever the context requires: the singular number shall include the plural and vice versa; the masculine gender shall include the feminine and neuter gender; the feminine gender
shall include the masculine and neuter gender; and the neuter gender shall include the feminine and masculine gender. 

  

	 	(e)	The Parties agree that any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be applied in the construction or
interpretation of this Agreement. 

  

	 	(f)	As used in this agreement “include” and “including” and variations thereof shall not be deemed to be terms of limitation, but rather shall be deemed to be
followed by the words “without limitation.” 

  
 [Signature Page Follows] 
  

 53 

 IN WITNESS WHEREOF, each of the Parties hereto has caused this Agreement to be executed and delivered by
its duly authorized representative as of the day and year first above written. 
  

							
	ARES TRADING S.A.	 	BIOMARIN PHARMACEUTICAL INC.
				
	By:	 	 /s/ Leon Bushara

	 	By:	 	 /s/ Emil Kakkis

	Name:	 	Leon Bushara	 	Name:	 	Emil Kakkis
	Title:	 	Senior Executive Vice President	 	Title:	 	Senior Vice President, Business Operations
				
	By:	 	 /s/ Frank Latrille

	 	 	 	 
	Name:	 	Frank Latrille	 	 	 	 
	Title:	 	Senior Executive Vice President	 	 	 	 

  

 Schedules - 1 

 Schedules to Development, License and Commercialization Agreement 
  
 SCHEDULE 1.10 
  
 BioMarin Patents 
  

					
	 Title / Inventors
 Appln/Patent
No.

	  	Filing
Issue
Expiration

	  	Assignee

	 PHENOPTIN
	  	 	  	 
			
	 Methods and Compositions for the Treatment of
 Phenylketonuria
  
 Dan Oppenheimer, Emil D. Kakkis, Fredric D. Price, Alejandro
 Dorenbaum
	  	 	  	BioMarin
Pharmaceutical Inc.  
 Merck Eprova

			
	 60/520,767
 United States
	  	11/17/03
Expired
11/17/04	  	 
			
	 PCT/US2004/038296
	  	11/17/04
Pending	  	 
			
	 10/991,573
 United States
	  	11/17/04
Pending
11/17/24	  	 
			
	 Crystalline Forms of (6R)-L-erythro-tetrahydrtobiopterin
 dihydrochloride
  
 Rudolf Moser, Viola Groehn, Thomas Egger, Fritz Blatter
	  	 	  	Merck Eprova
			
	 60/520,377
 United States
	  	11/17/03
Expired	  	 
			
	 PCT claiming priority to US Provl Appln 60/520,377
	  	11/17/04
Pending	  	 
			
	 10/990,316
 United States
	  	11/17/04
Pending
11/17/24	  	 
			
	 Methods for Preparing Tetrahydrobiopterin
	  	 	  	Merck Eprova
			
	 Rudolf Moser, Viola Groehn, Andreas Schumacher, Pierre Martin
	  	 	  	BioMarin
Pharmaceutical Inc.  

			
	 60/520,367
  
 United States
	  	11/17/03
Expired	  	 
			
	 60/520,368
  
 United States
	  	11/17/03
Expired	  	 
			
	 PCT/US2004/038313
	  	11/17/04
Pending	  	 

  

 Schedules - 2 

					
	 Title / Inventors
 Appln/Patent
No.

	  	 Filing
 Issue
Expiration

	  	Assignee

	 PHENOPTIN
	  	 	  	 
			
	 Stable Tablet Formulations
  
 Steven Jungles, Victoria Sluzky, Mark Henderson, Robert Baffi,
 Dan Oppenheimer, Emil D. Kakkis, Fredric D. Price, Alejandro
 Dorenbaum
	  	 	  	BioMarin
Pharmaceutical Inc.
			
	 60/629,189
 United States
	  	11/17/04
Pending
11/17/05	  	.
			
	 Methods and Compositions for the Treatment of Pulmonary
 Hypertension
 Emil D. Kakkis
	  	 	  	BioMarin
Pharmaceutical Inc.
			
	 60/634,147
 United States
	  	12/08/04
Pending
12/08/05	  	 
			
	 [****]
	  	 	  	 
			
	 Preparation Process of (6R)-Tetrahydro-L-Biopterin
  
 Hideaki Sakai, Tadashi Kanai
	  	 	  	Shiratori
Pharmaceutical Co.
Ltd.
Daiichi Suntory
Pharma Co., Ltd
			
	 4,713,454
 U.S.A.
	  	01/23/86
12/15/87
01/23/06	  	 
			
	 581052
 Australia
	  	01/24/86
05/24/89
01/24/06	  	 

  

 Schedules - 3 

					
	 Title / Inventors
 Appln/Patent
No.

	  	 Filing
 Issue
Expiration

	  	Assignee

	 PHENOPTIN
	  	 	  	 
			
	 1,262,347
 Canada
	  	01/23/86
10/17/89
01/24/06	  	 
			
	 E66229
 Austria
	  	01/24/86
08/14/91
01/24/06	  	 
			
	 0191335
 Belgium
	  	01/24/86
08/14/91
01/24/06	  	 
			
	 0191335
 Switzerland
	  	01/24/86
08/14/91
01/24/06	  	 
			
	 P3680800.8
 Germany
	  	01/24/86
08/14/91
01/24/06	  	 
			
	 0191335
 France
	  	01/24/86
08/14/91
01/24/06	  	 
			
	 0191335
 Great Britain
	  	01/24/86
08/14/91
01/24/06	  	 
			
	 0191335
 Italy
	  	01/24/86
08/14/91
01/24/06	  	 
			
	 0191335
 Luxembourg
	  	01/24/86
08/14/91
01/24/06	  	 
			
	 0191335
 Netherlands
	  	01/24/86
08/14/91
01/24/06	  	 
			
	 0191335
 Sweden
	  	01/24/86
08/14/91
01/24/06	  	 
			
	 Method for producing L-Biopterin
  
 Shinnosuke Tazawa, Takahiro Morita
	  	 	  	Shiratori
Pharmaceutical Co.
Ltd.
Daiichi Suntory
Pharma Co., Ltd

  

 Schedules - 4 

					
	 Title / Inventors
 Appln/Patent
No.

	  	 Filing
 Issue
Expiration

	  	Assignee

	 PHENOPTIN
	  	 	  	 
			
	 United States
	  	02/28/05
Pending
02/28/25	  	 
			
	 [****]
	  	 	  	 
			
	 Medicine for BH4-Responsive Hyperphenylalaninemia
  
 (Granule Formulation)
  
 Susumu Sugita, Masako Matsumoto, Tomokazu Nakai
	  	 	  	Daiichi Suntory
Pharma Co., Ltd
			
	 JP Appln No. 2004-141615
 Ref. No. DSP441
 Japan
	  	05/11/04
Pending
05/11/24	  	 
	 Preventives or Remedies for Diseases Induced by
 Hypofunction of Nitric Oxide Synthase (NOS)
  
 Takafumi Ishihara,
Mikio Okamura, Yoshiharu Kanayama, Haruo
 Shintaku, Junichi Yoshikawa
	  	 	  	Daiichi Suntory
Pharma Co., Ltd.
			
	 10/408571
 U.S.A.
	  	08/29/97
Pending
08/29/17	  	 
			
	 0908182
 Europe
	  	08/29/97
10/22/03
08/29/17	  	 
			
	 0908182 (E252385)
 Austria
	  	08/29/97
10/22/03
08/29/17	  	 
			
	 0908182
 Switzerland
	  	08/29/97
10/22/03
08/29/17	  	 
			
	 0908182 (69725721.5)
 Germany
	  	08/29/97
10/22/03
08/29/17	  	 

  

 Schedules - 5 

					
	 Title / Inventors
 Appln/Patent
No.

	  	 Filing
 Issue
Expiration

	  	Assignee

	 PHENOPTIN
	  	 	  	 
			
	 0908182
 Spain
	  	08/29/97
10/22/03
08/29/17	  	 
			
	 0908182
 France
	  	08/29/97
10/22/03
08/29/17	  	 
			
	 0908182
 Great Britain
	  	08/29/97
10/22/03
08/29/17	  	 
			
	 0908182
 Italy
	  	08/29/97
10/22/03
08/29/17	  	 
			
	 Appln. No.2236078
 Canada
	  	08/29/97
Pending
08/29/17	  	 
			
	 Appln. No.
 97191338.2
 China
	  	08/29/97
Pending
08/29/17	  	 
			
	 Appln. No.
 98-703140
 Korea
	  	08/29/97
Pending
08/29/17	  	 
			
	 Prophylactic or Therapeutic Agents for Diseases having
 Vascular Dysfunction Associated with Insulin Resistance
  
 Atsunori Kashiwagi, NoboruToda, Yoshihiko Nishio,
 Kazuya Shinozaki, TomioOkamura, Ryuichi Kikkawa
	  	 	  	Daiichi Suntory
Pharma Co., Ltd.
			
	 6,410,535
 U.S.A.
	  	02/26/99
06/25/02
02/27/18	  	 
			
	 Appln. No. 99906501.4
 Europe
	  	02/26/99
Pending
02/26/19	  	 
			
	 Prophylactic or therapeutic agents for drug-induced renal
 injury
  
 Mikio Okamura, Yoshiharu Kanayama, Junichi Yoshikawa, Haruo
 Shintaku,
	  	 	  	Daiichi Suntory
Pharma Co., Ltd.
			
	 6,288,067
 U.S.A.
	  	02/26/99
09/11/01
02/27/18	  	 

  

 Schedules - 6 

					
	 Title / Inventors
 Appln/Patent
No.

	  	 Filing
 Issue
Expiration

	  	Assignee

	 PHENOPTIN
	  	 	  	 
			
	 Appln. No. 99906500.6
 Europe
	  	02/26/99
Pending
02/26/19	  	 
			
	 Preventatives or Remedies for Diseases Caused by eNOS
 Expression
  
 Seinosuke Kawashima, Mitsuhiro Yokoyama
	  	 	  	Daiichi Suntory
Pharma Co., Ltd.
			
	 481385
 U.S.A.
	  	03/20/03
Pending
03/22/22	  	 
			
	 03715388.9
 Europe
	  	03/20/03
Pending
03/20/23	  	 
			
	 2451516
 Canada
	  	03/20/03
Pending
03/20/23	  	 
			
	 PI0303571
 Brazil
	  	03/20/03
Pending
03/20/23	  	 
			
	 03800566.2
 China
	  	03/20/03
Pending
03/20/23	  	 
			
	 10-2003-7017283
 Korea
	  	03/20/03
Pending
03/20/23	  	 
			
	 Pharmaceutical composition for the treatment of infantile
 autism
  
 Hiroshi Naruse, Masashi Takesada, Osamu Hayaishi,
 Yasuyoshi Watanabe
	  	 	  	Daiichi Suntory
Pharma Co., Ltd.
			
	 4,778,794
 U.S.A.
	  	06/04/86
10/18/88
10/18/05	  	 
			
	 4,920,122
 U.S.A.
	  	06/04/86
04/24/90
04/24/07	  	 
			
	 0209689
 Europe
	  	06/04/86
03/11/92
06/04/06	  	 

  

 Schedules - 7 

					
	 Title / Inventors
 Appln/Patent
No.

	  	 Filing
 Issue
Expiration

	  	Assignee

	 PHENOPTIN
	  	 	  	 
			
	 0209689
 Switzerland
	  	06/04/86
03/11/92
06/04/06	  	 
			
	 0209689(P3684190.0)
 Germany
	  	06/04/86
03/11/92
06/04/06	  	 
			
	 0209689
 France
	  	06/04/86
03/11/92
06/04/06	  	 
			
	 0209689
 Great Britain
	  	06/04/86
03/11/92
06/04/06	  	 
			
	 0209689
 Italy
	  	06/04/86
03/11/92
06/04/06	  	 
			
	 0209689
 Sweden
	  	06/04/86
03/11/92
06/04/06	  	 
			
	 Method for treating spinocerebellar degeneration
  
 Sakai, Tetsuo Toyojiro Matsuishi, Yasunobu
Antoku
	  	 	  	Daiichi Suntory
Pharma Co., Ltd.
			
	 5,753,656
 U.S.A.
	  	08/04/95
05/19/98
08/05/14	  	 
			
	 0722731
 Europe
	  	08/04/95
06/05/02
08/04/15	  	 
			
	 0722731
 (69526918.6)
 Germany
	  	08/04/95
06/05/02
08/04/15	  	 
			
	 0722731
 Spain
	  	08/04/95
06/05/02
08/04/15	  	 
			
	 0722731
 France
	  	08/04/95
06/05/02
08/04/15	  	 
			
	 0722731
 Great Britain
	  	08/04/95
06/05/02
08/04/15	  	 
			
	 0722731
 Italy
	  	08/04/95
06/05/02
08/04/15	  	 

  
  

 Schedules - 8 

					
	 PHENYLASE

	  	 	  	 
	 Production of Phenylalanine Ammonia Lyase
  
 Anson, J.G., Gilbert, H.J., Oram, J.D., Minton,
N.P
	  	 	  	The Health
Protection Agency
(CAMR)
			
	 87905772.7
 0321488
 Austria
	  	09/08/87
07/14/93
09/08/07	  	 
			
	 87905772.7
 0321488
 Belgium
	  	09/08/87
07/14/93
09/08/07	  	 
			
	 87905772.7
 0321488
 CH
	  	09/08/87
07/14/93
09/08/07	  	 
			
	 87905772.7
 P3786556.0
 Germany
	  	09/08/87
07/14/93
09/08/07	  	 
			
	 87905772.7
 0321488
 Europe
	  	09/08/87
07/14/93
09/08/07	  	 
			
	 87905772.7
 0321488
 France
	  	09/08/87
07/14/93
09/08/07	  	 
			
	 87905772.7
 0321488
 United Kingdom
	  	09/08/87
07/14/93
09/08/07	  	 
			
	 87905772.7
 0321488
 Italy
	  	09/08/87
07/14/93
09/08/07	  	 
			
	 505183/87
 2647883
 Japan
	  	09/08/87
07/14/93
09/08/07	  	 
			
	 87905772.7
 0321488
 Luxembourg
	  	09/08/87
07/14/93
09/08/07	  	 
			
	 87905772.7
 0321488
 Netherlands
	  	09/08/87
07/14/93
09/08/07	  	 
			
	 87905772.7
 0321488 SE
	  	09/08/87
07/14/93
09/08/07	  	 

  

 Schedules - 9 

					
	 GB87/00628
 PC
	  	09/08/87
Pending
09/08/07	  	 
			
	 2542/88
 DK
	  	09/08/87
Pending
09/08/07	  	 
			
	 02748341.1
 Europe
 Based on WO 02/070646
	  	02/15/02
Published
1/1/04
1372703
02/15/22	  	 
			
	 Variants and Chemically-Modified Variants of
 Phenylalanine Ammonia Lyase
  
 Alejandra Gamez, Lin Wang, Woomi Kim, Mary Straub,
 Marianne G. Patch, Emil Kakkis, Dan Oppenheimer, Paul
 Fitzpatrick, Robert Heft, and Raymond C. Stevens
	  	 	  	The Scripps
Research Institute
BioMarin
Pharmaceutical Inc.
			
	 Provisional Application 60/610,770
 United States
	  	09/17/04
Pending
09/17/05	  	 
			
	 Provisional Application 60/651,950
 United States
	  	02/09/05
Pending
02/09/06	  	 
			
	 [****]
	  	 	  	 

  
  

 Schedules - 10 

 SCHEDULE 1.12 
  
 [****] 
  

 Schedules - 11 

 Schedule 7.2(a) 
  
 [****] 
  
 Schedule 7.2(b)(i) 
  
 [****] 
  
 Schedule 7.2(b)(ii) 
  
 [****]

  
  

 Schedules - 12 

 Schedule 7.3(a) 
  
 [****] 
  
 Schedule 7.3(b) 
  
 [****] 
  
  

 Schedules - 13 

 Schedule 7.3(c)(i) 
 Payments to Third Parties for Licensed Products: Examples of Payment Calculations: 
  
 [****] 
  
 Schedule 7.3(c)(ii) 
 Payments to Third Parties for Licensed
Products: Examples of Payment Calculations 
  
 [****]

  

 Schedules - 14 

 Schedule 11.2(h)(i) 
  
 [****] 
  

 Schedules - 15 

 Schedule 11.2(h)(ii) 
  
 [****] 
  

 Schedules - 16 

 Schedule 11.2(h)(iii) 
  
 [****] 
  

 Schedules - 17 

 Schedule 11.2(h)(iv) 
  
 [****] 
  

 Schedules - 18 

 Exhibit 2.1 
 [****] 
  

 Schedules - 19Indenture, between CV Therapeutics and Wells Fargo Bank, National Association

 Exhibit 4.1 
  

CV THERAPEUTICS, INC. 
 as Issuer

  
 and 
  
 WELLS FARGO BANK, NATIONAL ASSOCIATION 
 as Trustee 
  
  
 INDENTURE 
  
 Dated as of July 1, 2005 
  
  
 31⁄4% SENIOR SUBORDINATED CONVERTIBLE NOTES DUE 2013 
  
  
  

 CROSS-REFERENCE TABLE 
  

				
	TIA Section	  	Indenture
Section

	 
	 310 (a)(1)
	  	5.11	 
	 (a)(2)
	  	5.11	 
	 (a)(3)
	  	n/a	 
	 (a)(4)
	  	n/a	 
	 (a)(5)
	  	5.11	 
	 (b)
	  	5.3;
5.11	 
 
	 (c)
	  	n/a	 
	 311 (a)
	  	5.12	 
	 (b)
	  	5.12	 
	 (c)
	  	n/a	 
	 312 (a)
	  	2.10	 
	 (b)
	  	14.3	 
	 (c)
	  	14.3	 
	 313 (a)
	  	5.7	 
	 (b)(1)
	  	n/a	 
	 (b)(2)
	  	5.7	 
	 (c)
	  	5.7;
14.2	 
 
	 (d)
	  	5.7	 
	 314 (a)(1),(2),(3)
	  	9.6;
14.6	 
 
	 (a)(4)
	  	9.6;
9.7;
14.6	 
 
 
	 (b)
	  	n/a	 
	 (c)(1)
	  	14.5	 
	 (c)(2)
	  	14.5	 
	 (c)(3)
	  	n/a	 
	 (d)
	  	n/a	 
	 (e)
	  	14.6	 
	 (f)
	  	n/a	 
	 315 (a)
	  	5.1	(a)
	 (b)
	  	5.6;
14.2	 
 
	 (c)
	  	5.1	(b)
	 (d)
	  	5.1	(c)
	 (e)
	  	4.14	 
	 316 (a)(last sentence)
	  	2.13	 
	 (a)(1)(A)
	  	4.5	 
	 (a)(1)(B)
	  	4.4	 
	 (a)(2)
	  	n/a	 
	 (b)
	  	4.7	 
	 (c)
	  	7.4	 
	 317 (a)(1)
	  	4.8	 
	 (a)(2)
	  	4.9	 
	 (b)
	  	2.5	 
	 318 (a)
	  	14.1	 
	 (b)
	  	n/a	 
	 (c)
	  	14.1	 

  
 “n/a” means
not applicable 
 This Cross-Reference Table shall not, for any purpose, be deemed to be a part of the Indenture. 
  
  

 TABLE OF CONTENTS 
  
 Page 

			
	 	  	

	 ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE
	  	1
	 SECTION 1.1. Definitions
	  	1
	 SECTION 1.2. Incorporation by Reference of Trust Indenture Act
	  	10
	 SECTION 1.3. Rules of Construction
	  	11
	 ARTICLE 2 THE SECURITIES
	  	11
	 SECTION 2.1. Title and Terms
	  	11
	 SECTION 2.2. Form of Securities
	  	12
	 SECTION 2.3. Legend
	  	13
	 SECTION 2.4. Execution, Authentication, Delivery and Dating
	  	14
	 SECTION 2.5. Registrar and Paying Agent
	  	14
	 SECTION 2.6. Paying Agent to Hold Assets in Trust
	  	15
	 SECTION 2.7. General Provisions Relating to Transfer and Exchange
	  	15
	 SECTION 2.8. Book-Entry Provisions for the Global Securities
	  	16
	 SECTION 2.9. [Reserved]
	  	17
	 SECTION 2.10. Holder Lists
	  	17
	 SECTION 2.11. Persons Deemed Owners
	  	17
	 SECTION 2.12. Mutilated, Destroyed, Lost or Stolen Securities
	  	18
	 SECTION 2.13. Treasury Securities
	  	18
	 SECTION 2.14. Temporary Securities
	  	19
	 SECTION 2.15. Cancellation
	  	19
	 SECTION 2.16. CUSIP Numbers
	  	19
	 SECTION 2.17. Defaulted Interest
	  	19
	 ARTICLE 3 SATISFACTION AND DISCHARGE
	  	20
	 SECTION 3.1. Satisfaction and Discharge of Indenture
	  	20
	 SECTION 3.2. Deposited Monies To Be Held in Trust
	  	21
	 SECTION 3.3. Return of Unclaimed Monies
	  	21
	 ARTICLE 4 DEFAULTS AND REMEDIES
	  	21
	 SECTION 4.1. Events of Default
	  	21
	 SECTION 4.2. Acceleration of Maturity; Rescission and Annulment
	  	23
	 SECTION 4.3. Other Remedies
	  	23
	 SECTION 4.4. Waiver of Past Defaults
	  	23
	 SECTION 4.5. Control by Majority
	  	24
	 SECTION 4.6. Limitation on Suit
	  	24
	 SECTION 4.7. Unconditional Rights of Holders to Receive Payment and to Convert
	  	25
	 SECTION 4.8. Collection of Indebtedness and Suits for Enforcement by the Trustee
	  	25
	 SECTION 4.9. Trustee May File Proofs of Claim
	  	26
	 SECTION 4.10. Restoration of Rights and Remedies
	  	26
	 SECTION 4.11. Rights and Remedies Cumulative
	  	26
	 SECTION 4.12. Delay or Omission Not Waiver
	  	26
	 SECTION 4.13. Application of Money Collected
	  	27
	 SECTION 4.14. Undertaking for Costs
	  	27
	 SECTION 4.15. Waiver of Stay or Extension Laws
	  	27

			
	 ARTICLE 5 THE TRUSTEE
	  	28
	 SECTION 5.1. Certain Duties and Responsibilities
	  	28
	 SECTION 5.2. Certain Rights of Trustee
	  	29
	 SECTION 5.3. Individual Rights of Trustee
	  	30
	 SECTION 5.4. Money Held in Trust
	  	30
	 SECTION 5.5. Trustee’s Disclaimer
	  	30
	 SECTION 5.6. Notice of Defaults
	  	30
	 SECTION 5.7. Reports by Trustee to Holders
	  	31
	 SECTION 5.8. Compensation and Indemnification
	  	31
	 SECTION 5.9. Replacement of Trustee
	  	31
	 SECTION 5.10. Successor Trustee by Merger, Etc
	  	32
	 SECTION 5.11. Corporate Trustee Required; Eligibility
	  	32
	 SECTION 5.12. Collection of Claims Against the Company
	  	32
	 ARTICLE 6 CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
	  	33
	 SECTION 6.1. Company May Consolidate, Etc. Only on Certain Terms
	  	33
	 SECTION 6.2. Successor Substituted
	  	33
	 ARTICLE 7 AMENDMENTS, SUPPLEMENTS AND WAIVERS
	  	34
	 SECTION 7.1. Without Consent of Holders of Securities
	  	34
	 SECTION 7.2. With Consent of Holders of Securities
	  	34
	 SECTION 7.3. Compliance with Trust Indenture Act
	  	35
	 SECTION 7.4. Revocation of Consents and Effect of Consents or Votes
	  	35
	 SECTION 7.5. Notation on or Exchange of Securities
	  	36
	 SECTION 7.6. Trustee to Sign Amendment, Etc
	  	36
	 ARTICLE 8 MEETING OF HOLDERS OF SECURITIES
	  	36
	 SECTION 8.1. Purposes for Which Meetings May Be Called
	  	36
	 SECTION 8.2. Call Notice and Place of Meetings
	  	37
	 SECTION 8.3. Persons Entitled to Vote at Meetings
	  	37
	 SECTION 8.4. Quorum; Action
	  	37
	 SECTION 8.5. Determination of Voting Rights; Conduct and Adjournment of Meetings
	  	38
	 SECTION 8.6. Counting Votes and Recording Action of Meetings
	  	38
	 ARTICLE 9 COVENANTS
	  	39
	 SECTION 9.1. Payment of Principal, Premium and Interest
	  	39
	 SECTION 9.2. Maintenance of Offices or Agencies
	  	39
	 SECTION 9.3. Corporate Existence
	  	39
	 SECTION 9.4. Maintenance of Properties
	  	40
	 SECTION 9.5. Payment of Taxes and Other Claims
	  	40
	 SECTION 9.6. Reports
	  	40
	 SECTION 9.7. Compliance Certificate
	  	40
	 SECTION 9.8. [Reserved]
	  	41
	 SECTION 9.9. Pledge and Escrow Agreement Deposit
	  	41
	 ARTICLE 10 REDEMPTION OF SECURITIES
	  	41
	 SECTION 10.1. Optional Redemption
	  	41
	 SECTION 10.2. Notice to Trustee
	  	41
	 SECTION 10.3. Selection of Securities to Be Redeemed
	  	41
	 SECTION 10.4. Notice of Redemption
	  	42
	 SECTION 10.5. Effect of Notice of Redemption
	  	43
	 SECTION 10.6. Deposit of Redemption Price
	  	43
	 SECTION 10.7. Securities Redeemed in Part
	  	43

			
	 ARTICLE 11 REPURCHASE OF SECURITIES
	  	43
	 SECTION 11.1. Repurchase Right Upon Fundamental Change
	  	43
	 SECTION 11.2. Conditions to the Company’s Election to Pay the Repurchase Price in Common Stock
	  	44
	 SECTION 11.3. Notices; Method of Exercising Repurchase Right, Etc
	  	45
	 ARTICLE 12 CONVERSION OF SECURITIES
	  	47
	 SECTION 12.1. Conversion Right and Conversion Rate
	  	47
	 SECTION 12.2. Exercise of Conversion Right
	  	48
	 SECTION 12.3. Fractions of Shares
	  	49
	 SECTION 12.4. Adjustment of Conversion Rate
	  	49
	 SECTION 12.5. Notice of Adjustments of Conversion Rate
	  	57
	 SECTION 12.6. Notice Prior to Certain Actions
	  	57
	 SECTION 12.7. Company to Reserve Common Stock
	  	58
	 SECTION 12.8. Taxes on Conversions
	  	58
	 SECTION 12.9. Covenant as to Common Stock
	  	58
	 SECTION 12.10. Cancellation of Converted Securities
	  	58
	 SECTION 12.11. Effect of Recapitalization, Reclassification, Consolidation, Merger or Sale
	  	58
	 SECTION 12.12. Responsibility of Trustee for Conversion Provisions
	  	59
	 SECTION 12.13. Make-Whole Premium
	  	60
	 ARTICLE 13 SUBORDINATION
	  	62
	 SECTION 13.1. Securities Subordinated to Senior Debt
	  	62
	 SECTION 13.2. Subrogation
	  	64
	 SECTION 13.3. Obligation of the Company Is Absolute and Unconditional
	  	64
	 SECTION 13.4. Maturity of or Default on Senior Debt
	  	64
	 SECTION 13.5. Payments on Securities Permitted
	  	64
	 SECTION 13.6. Effectuation of Subordination by Trustee
	  	64
	 SECTION 13.7. Knowledge of Trustee
	  	65
	 SECTION 13.8. Trustee’s Relation to Senior Debt
	  	65
	 SECTION 13.9. Rights of Holders of Senior Debt Not Impaired
	  	66
	 SECTION 13.10. Modification of Terms of Senior Debt
	  	66
	 SECTION 13.11. Certain Conversions Not Deemed Payment
	  	66
	 SECTION 13.12. Relation to Other Indebtedness
	  	66
	 ARTICLE 14 OTHER PROVISIONS OF GENERAL APPLICATION
	  	67
	 SECTION 14.1. Trust Indenture Act Controls
	  	67
	 SECTION 14.2. Notices
	  	67
	 SECTION 14.3. Communication by Holders with Other Holders
	  	68
	 SECTION 14.4. Acts of Holders of Securities
	  	68
	 SECTION 14.5. Certificate and Opinion as to Conditions Precedent
	  	69
	 SECTION 14.6. Statements Required in Certificate or Opinion
	  	69
	 SECTION 14.7. Effect of Headings and Table of Contents
	  	70
	 SECTION 14.8. Successors and Assigns
	  	70
	 SECTION 14.9. Separability Clause
	  	70
	 SECTION 14.10. Benefits of Indenture
	  	70
	 SECTION 14.11. Governing Law
	  	70
	 SECTION 14.12. Counterparts
	  	70
	 SECTION 14.13. Legal Holidays
	  	70
	 SECTION 14.14. Recourse Against Others
	  	70

  
  

 INDENTURE, dated as of July 1, 2005, between CV THERAPEUTICS, INC., a corporation duly organized and
existing under the laws of the State of Delaware, having its principal office at 3172 Porter Drive, Palo Alto, California 94304 (the “Issuer” or the “Company”), and WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee
(the “Trustee”), having its principal corporate trust office at Sixth & Marquette, MAC N9303-120, Minneapolis, MN 55479. 
  
 RECITALS OF THE COMPANY 
  
 The Company has duly authorized the creation of an issue of its 31⁄4% Senior Subordinated Convertible Notes due 2013 (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 and duly issued by the Company, 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.

  
 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 1 
 DEFINITIONS AND
INCORPORATION BY REFERENCE 
  
 SECTION 1.1.
Definitions. For all purposes of this Indenture and the Securities, the following terms are defined as follows: 
  
 “Act”, when used with respect to any Holder of a Security, has the meaning specified in Section 14.4(a) hereof. 
  
 “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. 
  
 “Bankruptcy Law” means Title
11 of the U.S. Code or any similar federal or state law for the relief of debtors. 
  
 “Board of Directors” means either the board of directors of the Company or any committee of that board empowered to act for it with respect to this Indenture. 
  

 1 

 “Board Resolution” means a resolution duly adopted by the Board of Directors, a copy of
which, certified by the Secretary or an Assistant Secretary of the Company to be in full force and effect on the date of such certification, shall have been delivered to the Trustee. 
  
 “Business Day”, when used with respect to any Place of Payment or Place of Conversion, means each Monday,
Tuesday, Wednesday, Thursday and Friday which is not a day on which banking institutions in that Place of Payment or Place of Conversion, as the case may be, are authorized or obligated by law to close. 
  
 “Change of Control” means the occurrence of any of the
following after the original issuance of the Securities: 
  
 (1)
the acquisition by any person, including any syndicate or group deemed to be a “person” under Section 13(d)(3) of the Exchange Act, 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 elections of
directors, other than any such acquisition by the Company, any subsidiary of the Company or any employee benefit plan of the Company; 
  
 (2) any consolidation or merger of the Company with or into any other person, any merger of another person into the Company, or any conveyance, transfer,
sale, lease or other disposition of all or substantially all of the properties and assets of the Company to another person, other than (a) any such transaction (x) that does not result in any reclassification, conversion, exchange or cancellation of
outstanding shares of capital stock of the Company and (y) pursuant to which holders of capital stock of the Company 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 of the Company entitled to vote generally in the election of directors of the continuing or surviving person immediately after such transaction or (b) any merger which is effected solely to change the
jurisdiction of incorporation of the Company and results in a reclassification, conversion or exchange of outstanding shares of Common Stock solely into shares of common stock of the surviving entity; 
  
 (3) during any consecutive two-year period, individuals who at the beginning
of that two-year period constituted the Board of Directors (together with any new directors whose election to the Board of Directors, or whose nomination for election by the stockholders of the Company, was approved by a vote of a majority of the
directors then still in office who were either directors at the beginning of such period or whose elections or nominations for election were previously so approved) cease for any reason to constitute a majority of the Board of Directors then in
office; or 
  
 (4) the Company is liquidated or dissolved or a
resolution is passed by the Company’s stockholders approving a plan of liquidation or dissolution of the Company other than in a transaction which complies with the provisions described in Article 6 of this Indenture. 
  
 Beneficial ownership shall be determined in accordance with Rule 13d-3
promulgated by the SEC under the Exchange Act. 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. 
  
 “Chief Executive Officer” means the chief executive officer
of the Company. 
  
 “Closing Price” of any
security on any date of determination means: 
  
 (1) the closing
sale price (or, if no closing sale price is reported, the last reported sale price) of such security (regular way) on the New York Stock Exchange on such date; 
  

 2 

 (2) if such security is not listed for trading on the New York Stock Exchange on any such date, the
closing sale price as reported in the composite transactions for the principal U.S. securities exchange on which such security is so listed; 
  
 (3) if such security is not so listed on a U.S. national or regional securities exchange, the closing sale price as reported by the Nasdaq National Market
or Nasdaq SmallCap Market; 
  
 (4) if such security is not so
reported, the last quoted bid price for such security in the over-the-counter market as reported by the National Quotation Bureau or similar organization; or 
  
 (5) if such bid price is not available, the average of the mid-point of the last bid and ask prices of such security on such date from at least three
nationally recognized independent investment banking firms retained for this purpose by the Company. 
  
 “Common Stock” means any stock of any class of the Company which has no preference in respect of dividends or of amounts payable in the
event of any voluntary or involuntary liquidation, dissolution or winding up of the Company and which is not subject to redemption by the Company. However, subject to the provisions of Section 12.11 hereof, shares issuable on conversion of
Securities shall include only shares of the class designated as Common Stock, par value $0.001 per share, of the Company at the date of this Indenture or shares of any class or classes resulting from any reclassification or reclassifications thereof
and which have no preference in respect of dividends or of amounts payable in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company and which are not subject to redemption by the Company, provided,
however, that if at any time there shall be more than one such resulting class, the shares of each such class then so issuable shall be substantially in the proportion which the total number of shares of such class resulting from all such
reclassifications bears to the total number of shares of all such classes resulting from all such reclassifications. 
  
 “Company” means the corporation named as the “Company” in the first paragraph of this instrument until a successor corporation
shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Company” shall mean such successor corporation. 
  
 “Company Notice” has the meaning specified in Section 11.3 hereof. 
  
 “Company Order” means a written order signed in the name of the Company by both (1) the Chief Executive
Officer, the President or a Vice President and (2) so long as not the same as the officer signing pursuant to clause (1), the Chief Financial Officer, the Treasurer, the Secretary or any Assistant Secretary of the Company, and delivered to the
Trustee. 
  
 “Conversion Agent” means any Person
authorized by the Company to convert Securities in accordance with Article 12 hereof. 
  
 “Conversion Price” shall equal (i) $1,000 divided by (ii) the Conversion Rate for $1,000 principal amount of Securities. 
  
 “Conversion Rate” has the meaning specified in Section 12.1 hereof. 
  
 “Corporate Trust Office” means for purposes of presentation
or surrender of Securities for payment, registration, transfer, exchange or conversion or for service of notices or demands upon the Company, the office of the Trustee located in the City of New York (which at the date of this Indenture is located
at Wells Fargo Corporate Trust, c/o The Depository Trust Company, 1st Floor, TADS Dept., 55 Water Street, New York, NY 10041), and for all other purposes, the office of the Trustee located in the City of Minneapolis, Minnesota (which at the date of
this Indenture is located at Sixth & Marquette, MAC N9303-120, Minneapolis, MN 55479). 
  

 3 

 “Corporation” means corporations, associations, limited liability companies, companies
and business trusts. 
  
 “Current Market Price”
has the meaning set forth in Section 12.4(g). 
  
 “Custodian” means any receiver, trustee, assignee, liquidator, sequestrator or similar official under any Bankruptcy Law. 
  
 “Default” means an event which is, or after notice or lapse of time or both would be, an Event of Default. 
  
 “Defaulted Interest” has the meaning specified in Section
2.17 hereof. 
  
 “Depositary” means The
Depository Trust Company, its nominees and their respective successors. 
  
 “Designated Senior Debt” means Senior Debt of the Company which, at the date of determination, has an aggregate amount outstanding of, or under which, at the date of determination, the holders thereof are committed to lend
up to, at least $12.5 million and is specifically designated in the instrument, agreement or other document evidencing or governing that Senior Debt as “Designated Senior Debt” for purposes of this Indenture (provided,
however, that such instrument, agreement or other document may place limitations and conditions on the right of such Senior Debt to exercise the rights of Designated Senior Debt). 
  
 “Dollar,” “U.S. 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 Participants” has the meaning specified in Section 2.8 hereof. 
  
 “Escrow Account” means the escrow account provided for under the Pledge and Escrow Agreement. 

 
 “Escrow Agent” means Wells Fargo Bank, National
Association, in its capacity as escrow agent under the Pledge and Escrow Agreement, and any permitted successors thereto. 
  
 “Event of Default” has the meaning specified in Section 4.1 hereof. 
  
 “Exchange Act” means the Securities Exchange Act of 1934, as amended. 
  
 “Expiration Time” has the meaning specified in Section
12.4(f) hereof. 
  
 “fair market value” has the
meaning set forth in Section 12.4(g) hereof. 
  
 “Fundamental Change” means the occurrence of either a Change of Control or a Termination of Trading. 
  
 “Fundamental Change Effective Date” means the date on which any Fundamental Change becomes effective. 
  
 “Global Security” has the meaning specified in Section 2.2
hereof. 
  

 4 

 “Guarantee” means any obligation, contingent or otherwise, of any Person, directly or
indirectly guaranteeing any Indebtedness of any other Person and any obligation, direct or indirect, contingent or otherwise, of such Person: 
  
 (1) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness of such other Person (whether arising by virtue of
partnership arrangements, or by agreement to keep-well, to purchase assets, goods, securities or services, to take-or-pay, or maintain financial statement conditions or otherwise); or 
  
 (2) entered into for purposes of assuring in any other manner the obligee of such Indebtedness of the payment thereof or to
protect such obligee against loss in respect thereof (in whole or in part); 
  
 provided, however, that the term “guarantee” will not include endorsements for collection or deposit in the ordinary course of business. The term “guarantee” used as a verb has a
corresponding meaning. 
  
 “Holder,” when used
with respect to any Security, means the Person in whose name the Security is registered in the Register. 
  
 “Indebtedness,” when used with respect to any Person, and without duplication means: 
  
 (1) all indebtedness, obligations and other liabilities (contingent or
otherwise) of such Person for borrowed money (including obligations of the Company in respect of overdrafts, foreign exchange contracts, currency exchange agreements, Interest Rate Protection Agreements, and any loans or advances from banks, whether
or not evidenced by notes or similar instruments) or evidenced by bonds, debentures, notes or other instruments for the payment of money, or incurred in connection with the acquisition of any property, services or assets (whether or not the recourse
of the lender is to the whole of the assets of such Person or to only a portion thereof), other than any account payable or other accrued current liability or obligation to trade creditors incurred in the ordinary course of business in connection
with the obtaining of materials or services; 
  
 (2) all
reimbursement obligations and other liabilities (contingent or otherwise) of such Person with respect to letters of credit, bank guarantees, bankers’ acceptances, surety bonds, performance bonds or other guaranty of contractual performance;

  
 (3) all obligations and liabilities (contingent or otherwise)
in respect of (a) leases of such Person required, in conformity with generally accepted accounting principles, to be accounted for as capitalized lease obligations on the balance sheet of such Person and (b) any lease or related documents (including
a purchase agreement) in connection with the lease of real property which provides that such Person is contractually obligated to purchase or cause a third party to purchase the leased property and thereby guarantee a minimum residual value of the
leased property to the landlord and the obligations of such Person under such lease or related document to purchase or to cause a third party to purchase the leased property; 
  
 (4) all obligations of such Person (contingent or otherwise) with respect to an interest rate or other swap, cap or collar
agreement or other similar instrument or agreement or foreign currency hedge, exchange, purchase or similar instrument or agreement; 
  
 (5) all direct or indirect guaranties or similar agreements by such Person in respect of, and obligations or liabilities (contingent or otherwise) of such
Person to purchase or otherwise acquire or otherwise assure a creditor against loss in respect of, indebtedness, obligations or liabilities of another Person of the kind described in clauses (1) through (4); 
  

 5 

 (6) any indebtedness or other obligations described in clauses (1) through (4) secured by any mortgage,
pledge, lien or other encumbrance existing on property which is owned or held by such Person, regardless of whether the indebtedness or other obligation secured thereby shall have been assumed by such Person; and 
  
 (7) any and all deferrals, renewals, extensions, refinancings, replacements,
restatements and refundings of, or amendments, modifications or supplements to, any indebtedness, obligation or liability of the kind described in clauses (1) through (6). 
  
 “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. 
  
 “Interest Payment Date” means each February 16 and August 16. 
  
 “Interest Rate” means 31⁄4% per annum. 
  
 “Interest Rate Protection Agreement” means, with respect to any Person, any interest rate swap agreement,
interest rate cap or collar agreement or other financial agreement or arrangement designed to protect such Person against fluctuations in interest rates, as in effect from time to time. 
  
 “Make-Whole Premium” has the meaning specified in Section 12.13 hereof. 
  
 “Maturity” 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 acceleration, conversion, call for redemption, exercise of a Repurchase Right or otherwise. 
  
 “Measurement Period” has the meaning specified in Section
12.4(d) hereof. 
  
 “Nasdaq National Market”
means the National Association of Securities Dealers Automated Quotation National Market or any successor national securities exchange or automated over-the-counter trading market in the United States. 
  
 “Non-Electing Share” has the meaning specified in Section
12.11 hereof. 
  
 “Officer” of the Company means
the Chief Executive Officer, the President, the Chief Financial Officer, the Treasurer, any Vice President, the Secretary or any Assistant Secretary of the Company. 
  
 “Officers’ Certificate” means a certificate signed by both (1) the Chief Executive Officer, the
President or a Vice President and (2) so long as not the same as the officer signing pursuant to clause (1), the Chief Financial Officer, the Treasurer or the Secretary of the Company, and delivered to the Trustee. 
  
 “Opinion of Counsel” means a written opinion of counsel, who
may be counsel to the Company (and may include directors or employees of the Company) and which opinion is acceptable to the Trustee, which acceptance shall not be unreasonably withheld. 
  
 “Outstanding,” when used with respect to Securities, means, as of the date of determination, all Securities
theretofore authenticated and delivered under this Indenture, except Securities: 
  
 (1) previously canceled by the Trustee or delivered to the Trustee for cancellation; 
  

 6 

 (2) for the payment or redemption of which money in the necessary amount has been previously 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, however, that
if such Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture; and 
  
 (3) which have been paid, 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.

  
 “Paying Agent” has the meaning specified in
Section 2.5 hereof. 
  
 “Payment Blockage Notice”
has the meaning specified in Section 13.1(d) hereof. 
  
 “Person” means any individual, corporation, limited liability company, partnership, joint venture, association, joint-stock company, trust, estate, unincorporated organization or government or any agency or political
subdivision thereof. 
  
 “Physical Securities”
has the meaning specified in Section 2.2 hereof. 
  
 “Place of Conversion” means any city in which any Conversion Agent is located. 
  
 “Place of Payment” means any city in which any Paying Agent is located. 
  
 “Pledge and Escrow Agreement” means the Pledge and Escrow Agreement, dated as of July 1, 2005, between the
Company and the Escrow Agent. 
  
 “Predecessor
Security” of any particular Security means every previous Security 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 2.12 hereof 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. 
  
 “Purchase Agreement” means the Purchase Agreement with
respect to the Securities, dated June 29, 2005, between the Company and the Underwriters. 
  
 “Quoted Price” of the Common Stock means the last reported sale price of the Common Stock on the Nasdaq National Market or, if the Common Stock is listed on a national securities exchange, then on
such exchange, or if the Common Stock is not quoted on Nasdaq National Market or listed on an exchange, the average of the last bid and asked price on the National Association of Securities Dealers Automated Quotation System. 
  
 “Record Date” means either a Regular Record Date or a
Special Record Date, as the case may be, provided that, for purposes of Section 12.4 hereof, Record Date has the meaning specified in Section 12.4(g) hereof. 
  
 “Redemption Date,” when used with respect to any Security to be redeemed, means the date fixed for such redemption pursuant to this
Indenture. 
  
 “Redemption Price” has the meaning
specified in Section 10.1 hereof. 
  

 7 

 “Reference Period” has the meaning set forth in Section 12.4(d) hereof. 
  
 “Register” has the meaning specified in Section 2.5 hereof.

  
 “Registrar” has the meaning specified in
Section 2.5 hereof. 
  
 “Regular Record Date” for
the interest on the Securities payable means the February 1 (whether or not a Business Day) next preceding a February 16 Interest Payment Date and the August 1 (whether or not a Business Day) next preceding an August 16 Interest Payment Date.

  
 “Repurchase Date” has the meaning specified
in Section 11.1 hereof. 
  
 “Repurchase Price”
has the meaning specified in Section 11.1 hereof. 
  
 “Repurchase Right” has the meaning specified in Section 11.1 hereof. 
  
 “Responsible Officer,” when used with respect to the Trustee, means any officer of the Trustee, including any vice president, assistant vice president, secretary, assistant secretary, the treasurer,
any assistant treasurer, the managing director or any other officer of the Trustee customarily performing functions similar to those performed by any of the above designated officers and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of such officer’s knowledge of and familiarity with the particular subject. 
  
 “Rights” means any common stock or preferred stock purchase right, as the case may be, that all or substantially all shares of Common
Stock are entitled to receive under a Rights Plan. 
  
 “Rights Plan” means the Company’s preferred shares rights plan in connection with the First Amended and Restated Rights Agreement, dated as of July 19, 2000, by and between the Company and Wells Fargo Bank, National
Association, as successor to Wells Fargo Bank Minnesota, N.A., and any preferred shares rights plan or any similar plan adopted by the Company after the date hereof. 
  
 “SEC” means the Securities and Exchange Commission. 
  
 “Securities” has the meaning ascribed to it in the first
paragraph under the caption “Recitals of the Company.” 
  
 “Securities Act” means the Securities Act of 1933, as amended. 
  
 “Senior Debt” means the principal of, premium, if any, interest (including all interest accruing subsequent to the commencement of any bankruptcy or similar proceeding, whether or not a claim for
post-petition interest is allowable as a claim in any such proceeding) and rent payable on or termination payment with respect to or in connection with, and all fees, costs, expenses and other amounts accrued or due on or in connection with,
Indebtedness of the Company, whether outstanding on the date of this Indenture or thereafter created, incurred, assumed, guaranteed or in effect guaranteed by the Company (including all deferrals, renewals, extensions or refundings of, or
amendments, modifications or supplements to, the foregoing), except for (a) any particular Indebtedness in respect of which the instrument creating or evidencing the same or the assumption or guarantee thereof expressly provides that such
Indebtedness shall not be senior in right of payment to the Securities or expressly provides that such Indebtedness is pari passu or junior to the Securities and (b) any Indebtedness between or among the Company and/or any of its subsidiaries, or
any of the Company’s Affiliates. The term “Senior Debt” shall include, without limitation, all Designated Senior Debt. 
  

 8 

 “Significant Subsidiary” means any Subsidiary which is a “significant
subsidiary” within the meaning of Rule 405 under the Securities Act. 
  
 “Special Record Date” for the payment of any Defaulted Interest means a date fixed by the Trustee pursuant to Section 2.17 hereof. 
  
 “Spin-off” has the meaning specified in Section 12.4(d) hereof. 
  
 “Stated Maturity” means the date specified in any Security
as the fixed date for the payment of principal on such Security or on which an installment of interest on such Security is due and payable. 
  
 “Stock Price” means (i) in connection with a Fundamental Change in which the Holders receive only cash, the amount of cash paid per share
of Common Stock in connection with the Fundamental Change, and (ii) in all other cases means the average of the Closing Price of the Common Stock for the 20 Trading Days ending on the Trading Day immediately preceding the Fundamental Change
Effective Date for such Fundamental Change. 
  
 “Subsidiary” means a corporation more than 50% of the outstanding voting stock 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 only, “voting stock” means stock which ordinarily has voting power for the election of directors, whether at all times or only so long as no senior class of stock has such voting power by
reason of any contingency. 
  
 “Termination of
Trading” means the occurrence of the Common Stock or any other common stock into which the Securities are then convertible being neither listed for trading on a United States national securities exchange nor approved for listing on Nasdaq
National Market or any similar United States system of automated dissemination of quotations of securities prices or traded in over-the-counter securities markets, and no American Depositary Shares or similar instruments for such common stock are so
listed or approved for listing in the United States. 
  
 “TIA” means the Trust Indenture Act of 1939 (15 U.S. Code §§ 77aaa-77bbbb), as in effect on the date of this Indenture; provided, however, that in the event the TIA is amended after such date,
“TIA” means, to the extent required by such amendment, the Trust Indenture Act of 1939, as so amended, or any successor statute. 
  
 “Trading Day” means a day during which trading in securities generally occurs on The New York Stock Exchange or, if the Common Stock is
not then listed on The New York Stock Exchange, on the principal other national or regional securities exchange on which the Common Stock is then listed or, if the Common Stock is not then listed on a national or regional securities exchange, on the
Nasdaq National Market or, if the Common Stock is not then quoted on the Nasdaq National Market, on the principal other market on which the Common Stock is traded. 
  
 “Transfer Agent” means any Person, which may be the Company, authorized by the Company to exchange or
register the transfer of Securities. 
  
 “Trigger
Event” has the meaning specified in Section 12.4(d) hereof. 
  
 “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. 
  

 9 

 “Underwriters” means Lehman Brothers Inc., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Citigroup Global Markets Inc. and Deutsche Bank Securities Inc. 
  
 “U.S. Government Obligations” means: (1) direct obligations of the United States of America for the payment of which the full faith and credit of the United States of America is pledged or (2)
obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America, the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America
and which, in either case, are non-callable at the option of the issuer thereof. 
  
 “Vice President,” when used with respect to the Company, means any vice president, whether or not designated by a number or a word or words added before or after the title “vice president.”

  
 SECTION 1.2. Incorporation by Reference of Trust Indenture
Act. Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture. 
  
 The following TIA terms used in this Indenture have the following meanings: 
  
 (i) “indenture securities” means the Securities; 
  
 (ii) “indenture security holder” means a Holder; 
  
 (iii) “indenture to be qualified” means this Indenture; 
  
 (iv) “indenture trustee” or “institutional trustee” means
the Trustee; and 
  
 (v) “obligor” on the Securities
means the Company and any other obligor on the indenture securities. 
  
 All other TIA terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by SEC rule have the meanings assigned to them by such definitions. 
  
 SECTION 1.3. Rules of Construction. For all purposes of this Indenture,
except as otherwise expressly provided or unless the context otherwise requires: 
  
 (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 accounting
principles generally accepted in the United States prevailing at the time of any relevant computation hereunder; 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. 
  
 ARTICLE 2 
 THE SECURITIES 
  
 SECTION 2.1. Title and Terms. The Securities shall be known and designated as the “31⁄4% Senior Subordinated Convertible Notes due
2013” of the Company. The aggregate principal amount of Securities which may be authenticated and delivered under this Indenture is limited to $130,000,000 (or $149,500,000 if the option set forth in Section 2(b) of the Purchase Agreement is
exercised in full), except for securities 

  

 10 

 
authenticated and delivered upon registration of, transfer of, or in exchange for, or in lieu of other Securities pursuant to Section 2.7, 2.8, 2.12, 7.5,
10.7, 11.1 or 12.2 hereof. The Securities shall be issuable in denominations of $1,000 or integral multiples thereof. 
  
 The Securities shall mature on August 16, 2013. 
  
 Interest shall accrue from July 1, 2005 at the Interest Rate until the principal thereof is paid or made available for payment. Interest shall be payable
semiannually in arrears on February 16 and August 16 of each year, commencing February 16, 2006. 
  
 Interest on the Securities shall be computed on the basis of a 360-day year of twelve 30-day months, and for any period shorter than a full semiannual
period for which interest is calculated, on the basis of a 30-day month, and for such periods of less than a month, the actual number of days elapsed over a 30-day month. 
  
 A Holder of any Security at the close of business on a Regular Record Date shall be entitled to receive interest on such
Security on the corresponding Interest Payment Date. If the Company is required by law to withhold any taxes with respect to a deemed distribution to a Holder resulting from a Conversion Rate adjustment, such taxes may be withheld from interest
payments made to such Holder on or after the date of such Conversion Price adjustment. 
  
 A Holder of any Security which is converted after the close of business on a Regular Record Date and prior to the corresponding Interest Payment Date (other than any Security whose Maturity is prior to such Interest
Payment Date) shall be entitled to receive interest on the principal amount of such Security on such Interest Payment Date, notwithstanding the conversion of such Security prior to such Interest Payment Date. However, any such Holder which
surrenders any such Security for conversion during the period between the close of business on such Regular Record Date and ending with the opening of business on the corresponding Interest Payment Date shall be required to pay the Company an amount
equal to the interest on the principal amount of such Security so converted (but excluding any overdue interest on the principal amount of such Security so converted that exists at the time such Holder surrenders such Security for conversion), which
is payable by the Company to such Holder on such Interest Payment Date, at the time such Holder surrenders such Security for conversion. Notwithstanding the foregoing, any such Holder which surrenders for conversion any Security (a) which has been
called for redemption by the Company in a notice of redemption given by the Company pursuant to Section 10.4 hereof on a Redemption Date after such Regular Record Date and on or prior to the next succeeding Interest Payment Date or (b) with respect
to which the Company has specified a Repurchase Date that is after such Regular Record Date and on or prior to the next succeeding Interest Payment Date, in either case, shall be entitled to receive (and retain) such interest and need not pay the
Company an amount equal to the interest on the principal amount of such Security so converted at the time such Holder surrenders such Security for conversion. 
  

Principal of, and premium, if any, and interest on, Global Securities shall be payable to the Depositary in immediately available funds. 
  
 Principal and premium, if any, on Physical Securities shall be payable at the
office or agency of the Company maintained for such purpose, initially the Corporate Trust Office of the Trustee. Interest on Physical Securities will be payable by (i) U.S. Dollar check drawn on a bank located in the city where the Corporate Trust
Office of the Trustee is located mailed to the address of the Person entitled thereto as such address shall appear in the Register, or (ii) upon application to the Registrar not later than the relevant Record Date by a Holder of an aggregate
principal amount in excess of $5,000,000, wire transfer in immediately available funds. 
  
 The Securities shall be redeemable at the option of the Company as provided in Article 10 hereof. 
  

 11 

 The Securities shall have the repurchase rights exercisable at the option of Holders as provided in
Article 11 hereof. 
  
 The Securities shall be convertible as
provided in Article 12 hereof. 
  
 The Securities shall be
subordinated in right of payment to Senior Debt of the Company as provided in Article 13 hereof. 
  
 SECTION 2.2. Form of Securities. The Securities and the Trustee’s certificate of authentication to be borne by such Securities shall be substantially
in the form annexed hereto as Exhibit A, which is incorporated in and made a part of this Indenture. The terms and provisions contained in the form of Security shall constitute, and are hereby expressly made, a part of this Indenture and to
the extent applicable, the Company and the Trustee, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby. 
  
 Any of the Securities may have such letters, numbers or other marks of identification and such notations, legends and
endorsements as the Officers executing the same may approve (execution thereof to be conclusive evidence of such approval) and as are not inconsistent with the provisions of this Indenture, or as may be required to comply with any law or with any
rule or regulation made pursuant thereto or with any rule or regulation of any securities exchange or automated quotation system on which the Securities may be listed or designated for issuance, or to conform to usage. 
  
 The Securities shall be issued initially only in the form of one or more
permanent Global Securities (each, a “Global Security”) in registered form without interest coupons. The Global Securities shall be: 
  
 (1) duly executed by the Company and authenticated by the Trustee as hereinafter provided; 
  
 (2) registered in the name of the Depositary (or its nominee) for credit to the respective accounts of the Holders at the
Depositary; and 
  
 (3) deposited with the Trustee, as custodian
for the Depositary. 
  
 The Global Securities shall be
substantially in the form of Security set forth in Exhibit A annexed hereto (including the text and schedule called for by footnotes 1 and 2 thereto). The aggregate principal amount of the Global Securities may from time to time be increased
or decreased by adjustments made on the records of the Trustee, as custodian for the Depositary (or its nominee), in accordance with the instructions given by the Holder thereof, as hereinafter provided. 
  
 Securities issued in exchange for interests in the Global Securities pursuant
to Section 2.8(d) hereof shall be issued in the form of permanent definitive Securities (the “Physical Securities”) in registered form without interest coupons. The Physical Securities shall be substantially in the form set forth in
Exhibit A annexed hereto. 
  
 The Securities shall be
typed, printed, lithographed or engraved or produced by any combination of these methods or may be produced in any other manner permitted by the rules of any securities exchange on which the Securities may be listed, all as determined by the
Officers executing such Securities, as evidenced by their execution of such Securities. 
  

 12 

 SECTION 2.3. Legend. Each Global Security shall bear the following legend on the face thereof:

  
 UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (“DTC”) TO CV THERAPEUTICS, INC. (OR ITS SUCCESSOR) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, CONVERSION OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF CEDE & CO. OR IN SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON 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 SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. 
  
 SECTION 2.4. Execution, Authentication, Delivery and Dating. Two Officers shall execute the Securities on behalf of the Company by manual or facsimile
signature. If an Officer whose signature is on a Security no longer holds that office at the time the Security is authenticated, the Security shall be valid nevertheless. 
  
 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 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 deliver such Securities as
in this Indenture provided and not otherwise. 
  
 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 or on behalf of the
Trustee by manual signature, and such certificate upon any Security shall be conclusive evidence, and the only evidence, that such Security has been duly authenticated and delivered hereunder. 
  
 The Trustee may appoint an authenticating agent or agents reasonably
acceptable to the Company with respect to the Securities. Unless limited by the terms of such appointment, an authenticating agent may authenticate Securities whenever the Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. 
  
 SECTION 2.5.
Registrar and Paying Agent. The Company shall maintain an office or agency where Securities may be presented for registration of transfer or for exchange (the “Registrar”) and an office or agency where Securities may be presented
for payment (the “Paying Agent”). The Registrar shall keep a register of the Securities (the “Register”) and of their transfer and exchange. The Company may appoint one or more co-Registrars and one or more
additional Paying Agents for the Securities. The term “Paying Agent” includes any additional paying agent and the term “Registrar” includes any additional registrar. The Company may change any Paying Agent or Registrar without
prior notice to any Holder. 
  
 The Company will cause each Paying
Agent (other than the Trustee) to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will: 
  
 (1) hold all sums held by it for the payment of the principal of and premium,
if any, or interest on Securities in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as provided in this Indenture; 
  

 13 

 (2) give the Trustee notice of any Default by the Company in the making of any payment of principal and
premium, if any, or interest; and 
  
 (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 in trust by such Paying Agent. 
  
 The Company shall give prompt written notice to the Trustee of the name and address of any Agent who is not a party to this Indenture. If the Company
fails to appoint or maintain another entity as Registrar or Paying Agent, the Trustee shall act as such. The Company or any Affiliate of the Company may act as Paying Agent or Registrar; provided, however, that none of the Company, its
Subsidiaries or the Affiliates of the foregoing shall act: 
  
 (i)
as Paying Agent in connection with redemptions, offers to purchase and discharges, as otherwise specified in this Indenture, and 
  
 (ii) as Paying Agent or Registrar if a Default or Event of Default has occurred and is continuing. 
  
 The Company hereby initially appoints the Trustee as Registrar and Paying
Agent for the Securities. 
  
 SECTION 2.6. Paying Agent to Hold
Assets in Trust. Not later than 11:00 a.m. (New York City time) on each due date of the principal, premium, if any, and interest on any Securities, the Company shall deposit with one or more Paying Agents money in immediately available funds
sufficient to pay such principal, premium, if any, and interest so becoming due. The Company at any time may require a Paying Agent to pay all money held by it to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the
Company) shall have no further liability for the money so paid over to the Trustee. 
  
 If the Company shall act as a Paying Agent, it shall, prior to or on each due date of the principal of and premium, if any, or interest on any of the Securities, segregate and hold in trust for the benefit of the
Holders a sum sufficient with monies held by all other Paying Agents, to pay the principal and premium, if any, or interest so becoming due until such sums shall be paid to such Persons or otherwise disposed of as provided in this Indenture, and
shall promptly notify the Trustee of its action or failure to act. 
  
 SECTION 2.7. General Provisions Relating to Transfer and Exchange. The Securities are issuable only in registered form. A Holder may transfer a Security only by written application to the Registrar stating the name of the proposed
transferee and otherwise complying with the terms of this Indenture. No such transfer shall be effected until, and such transferee shall succeed to the rights of a Holder only upon, final acceptance and registration of the transfer by the Registrar
in the Register. Furthermore, any Holder of a Global Security shall, by acceptance of such Global Security, agree that transfers of beneficial interests in such Global Security may be effected only through a book-entry system maintained by the
Holder of such Global Security (or its agent) and that ownership of a beneficial interest in the Security shall be required to be reflected in a book-entry. 
  
 When Securities are presented to the Registrar with a request to register the transfer or to exchange them for an equal aggregate principal amount of
Securities of other authorized denominations, the Registrar shall register the transfer or make the exchange as requested if its requirements for such transactions are met (including that such Securities are duly endorsed or accompanied by a written
instrument of transfer duly executed by the Holder thereof or by an attorney who is authorized in writing to act on behalf of the Holder). Subject to Section 2.4 hereof, to permit registrations of transfers and exchanges, the Company shall execute
and the Trustee shall authenticate Securities at the Registrar’s request. No service charge shall be made for any registration of transfer or exchange or redemption of the Securities, but the Company may require 

  

 14 

 
payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith (other than any such transfer taxes or
other similar governmental charge payable upon exchanges pursuant to Section 2.14, 7.5 or 10.7 hereof). 
  
 Neither the Company nor the Registrar shall be required to exchange or register a transfer of any Securities: 
  
 (1) for a period of 15 Business Days prior to the day of any selection of
Securities for redemption under Article 10 hereof; 
  
 (2) so
selected for redemption or, if a portion of any Security is selected for redemption, such portion thereof selected for redemption; or 
  
 (3) surrendered for conversion or, if a portion of any Security is surrendered for conversion, such portion thereof surrendered for conversion.

  
 SECTION 2.8. Book-Entry Provisions for the Global Securities.

  
 (a) The Global Securities initially shall 
  
 (i) be registered in the name of the Depositary (or a nominee thereof);

  
 (ii) be delivered to the Trustee as custodian for such
Depositary; and 
  
 (iii) bear the Restricted Securities Legend as
set forth in Section 2.3(a)(i) hereof. 
  
 Members of, or
participants in, the Depositary (“DTC Participants”) shall have no rights under this Indenture with respect to any Global Security held on their behalf by the Depositary, or the Trustee as its custodian, or under such Global
Security, and the Depositary may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of such Global Security for all purposes whatsoever. Notwithstanding the foregoing, nothing contained herein
shall prevent the Company, the Trustee or any agent of the Company or Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depositary or impair, as between the Depositary and the DTC Participants,
the operation of customary practices governing the exercise of the rights of a Holder of any Security. 
  
 (b) The registered Holder of a Global Security may grant proxies and otherwise authorize any Person, including DTC Participants and Persons that may hold
interests through DTC Participants, to take any action which a Holder is entitled to take under this Indenture or the Securities. 
  
 (c) A Global Security may not be transferred, in whole or in part, to any Person other than the Depositary (or a nominee thereof), and no such transfer to
any such other Person may be registered. Beneficial interests in a Global Security may be transferred in accordance with the rules and procedures of the Depositary and the provisions of Section 2.9 hereof. 
  
 (d) If at any time: 
  
 (i) the Depositary notifies the Company in writing that it is no longer
willing or able to continue to act as Depositary for the Global Securities, or the Depositary ceases to be a “clearing agency” registered under the Exchange Act, and a successor depositary for the Global Securities is not appointed by the
Company within 90 days of such notice or cessation; 
  

 15 

 (ii) the Company, at its option, notifies the Trustee in writing that it elects to cause the issuance of
the Securities in definitive form under this Indenture in exchange for all or any part of the Securities represented by a Global Security or Global Securities; or 
  
 (iii) an Event of Default has occurred and is continuing and the Registrar has received a request from the Depositary for
the issuance of Physical Securities in exchange for such Global Security or Global Securities, 
  
 the Depositary shall surrender such Global Security or Global Securities to the Trustee for cancellation and the Company shall execute, and the Trustee, upon receipt of an Officers’ Certificate and Company Order
for the authentication and delivery of Securities, shall authenticate and deliver in exchange for such Global Security or Global Securities, Physical Securities of like tenor as that of the Global Securities in an aggregate principal amount equal to
the aggregate principal amount of such Global Security or Global Securities. Such Physical Securities shall be registered in such names as the Depositary shall identify in writing as the beneficial owners of the Securities represented by such Global
Security or Global Securities (or any nominees thereof). 
  
 Notwithstanding the foregoing, in connection with any transfer of beneficial interests in a Global Security to beneficial owners pursuant to Section 2.8(d) hereof, the Registrar shall reflect on its books and records the date and a decrease
in the principal amount of such Global Security in an amount equal to the principal amount of the beneficial interest in such Global Security to be transferred. 
  

SECTION 2.9. [Reserved]. 
  
 SECTION 2.10. Holder Lists. The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of
the names and addresses of Holders and shall otherwise comply with Section 312(a) of the TIA. If the Trustee is not the Registrar, the Company shall furnish to the Trustee prior to or on each Interest Payment Date and at such other times as the
Trustee may request in writing a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Holders relating to such Interest Payment Date or request, as the case may be. 
  
 SECTION 2.11. Persons Deemed Owners. The Company, the Trustee and any agent
of the Company or the Trustee may treat the registered Holder of a Global Security as the absolute owner of such Global Security for the purpose of receiving payment thereof or on account thereof and for all other purposes whatsoever, whether or not
such Security be overdue, and notwithstanding any notice of ownership or writing thereon, or any notice of previous loss or theft or other interest therein. The Company, the Trustee and any agent of the Company or the Trustee may treat the Person in
whose name any Security is registered as the owner of such Security for the purpose of receiving payment of principal of and premium, if any, and interest on such Security and for all other purposes whatsoever, whether or not such Security be
overdue, and notwithstanding any notice of ownership or writing thereon, or any notice of previous loss or theft or other interest therein. 
  
 SECTION 2.12. 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 is delivered to the Company and the Trustee 
  
 (1) evidence to their satisfaction of the destruction, loss or theft of any Security, and 
  

 16 

 (2) such security or indemnity as may be required by them to save each of them and any agent of either of
them harmless, 
  
 then, in the absence of notice to the Company
or the Trustee that such Security has been acquired by a bona fide purchaser, the Company shall execute and, upon request, the Trustee shall authenticate and deliver, in lieu of any such destroyed, lost or stolen 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 condition set forth in the preceding paragraph. 
  
 Upon the issuance of any new Security under this Section, the Company may require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) connected therewith. 
  
 Every new Security issued pursuant to this Section in lieu of any destroyed, lost or stolen Security shall constitute an original additional contractual
obligation of the Company, whether or not the 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. 
  
 The provisions of this
Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities. 
  
 SECTION 2.13. Treasury Securities. In determining whether the Holders of the
requisite principal amount of Outstanding Securities are present at a meeting of Holders for quorum purposes or have given any request, demand, authorization, direction, notice, consent or waiver hereunder, Securities owned by the Company or any
Affiliate of the Company shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee shall be protected in relying upon any such determination as to the presence of a quorum or upon any such request,
demand, authorization, direction, notice, consent or waiver, only such Securities of which the Trustee has received written notice and are so owned shall be so disregarded. 
  
 SECTION 2.14. Temporary Securities. Pending the preparation of Securities in definitive form, the Company may execute and
the Trustee shall, upon written request of the Company, authenticate and deliver temporary Securities (printed or lithographed). Temporary Securities shall be issuable in any authorized denomination, and substantially in the form of the Securities
in definitive form but with such omissions, insertions and variations as may be appropriate for temporary Securities, all as may be determined by the Company. Every such temporary Security shall be executed by the Company and authenticated by the
Trustee upon the same conditions and in substantially the same manner, and with the same effect, as the Securities in definitive form. Without unreasonable delay, the Company will execute and deliver to the Trustee Securities in definitive form
(other than in the case of Securities in global form) and thereupon any or all temporary Securities (other than any such Securities in global form) may be surrendered in exchange therefor, at each office or agency maintained by the Company pursuant
to Section 9.2 and the Trustee shall authenticate and deliver in exchange for such temporary Securities an equal aggregate principal amount of Securities in definitive form. Such exchange shall be made by the Company at its own expense and without
any charge therefor. Until so exchanged, the temporary Securities shall in all respects be entitled to the same benefits and subject to the same limitations under this Indenture as Securities in definitive form authenticated and delivered hereunder.

  

 17 

 SECTION 2.15. Cancellation. All securities surrendered for payment, redemption, repurchase,
conversion, registration of transfer or exchange shall, if surrendered to any Person other than the Trustee, be delivered to the Trustee. All Securities so delivered shall be canceled promptly by the Trustee, and no Securities shall be issued in
lieu thereof except as expressly permitted by any of the provisions of this Indenture. Upon written instructions of the Company, the Trustee shall dispose of the Securities in accordance with its usual and customary policies and procedures and,
thereafter, shall deliver a certificate of such cancellation to the Company. If the Company shall acquire any of the Securities, such acquisition shall not operate as a redemption or satisfaction of the indebtedness represented by such Securities
unless the same are delivered to the Trustee for cancellation. 
  
 SECTION 2.16. CUSIP Numbers. The Company in issuing the Securities may use “CUSIP” numbers (if then generally in use), and the Trustee shall use CUSIP numbers in notices of redemption or exchange as a convenience to
Holders; provided, however, that any such notice shall state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any such notice and that reliance may be placed
only on the other identification numbers printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such numbers. The Company shall promptly notify the Trustee of any change in the CUSIP numbers.

  
 SECTION 2.17. Defaulted Interest. If the Company fails to make
a payment of interest on any Security when due and payable (“Defaulted Interest”), it shall pay such Defaulted Interest plus (to the extent lawful) any interest payable on the Defaulted Interest, in any lawful manner. It may elect
to pay such Defaulted Interest, plus any such interest payable on it, to the Persons who are Holders of such Securities on which the interest is due on a subsequent Special Record Date. The Company shall notify the Trustee in writing of the amount
of Defaulted Interest proposed to be paid on each such Security. The Company shall fix any such Special Record Date and payment date for such payment. At least 15 days before any such Special Record Date, the Company shall mail to Holders affected
thereby a notice that states the Special Record Date, the Interest Payment Date, and amount of such interest to be paid. 
  
 ARTICLE 3 
 SATISFACTION AND DISCHARGE

  
 SECTION 3.1. Satisfaction and Discharge of Indenture.
When: 
  
 (1) The Company shall deliver to the Trustee for
cancellation all Securities previously authenticated (other than any Securities which have been destroyed, lost or stolen and in lieu of or in substitution for which other Securities shall have been authenticated and delivered) and not previously
canceled, or 
  
 (2) (A) All the securities not previously
canceled or delivered to the Trustee for cancellation shall have become due and payable, or are by their terms to become due and payable within one year or are to be called for redemption within one year under arrangements satisfactory to the
Trustee for the giving of notice of redemption, 
  

	(B)	The Company shall deposit with the Trustee, in trust, cash in U.S. dollars and/or U.S. Government Obligations which through the payment of interest and principal in respect thereof,
in accordance with their terms, will provide (and without reinvestment and assuming no tax liability will be imposed on the Trustee), not later than one day before the due date of any payment of money, an amount in cash, sufficient, in the opinion
of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, to pay principal of, premium, if any, or interest on all of the Securities (other than any Securities which
shall have been mutilated, destroyed, lost or stolen and in lieu of 

  

 18 

 or in substitution for which other Securities shall have been authenticated and delivered) not previously
canceled or delivered to the Trustee for cancellation, on the dates such payments of principal, premium, if any, or interest are due to such date of maturity or redemption, as the case may be, and 
  
 (C) The Company shall have delivered to the Trustee an Officers’
Certificate and an Opinion of Counsel to the effect that (x) the Company has received from, or there has been published by, the Internal Revenue Service a ruling or (y) since the date of execution of this Indenture, there has been a change in the
applicable federal income tax law, in the case of either clause (x) or (y) to the effect that, and based thereon such Opinion of Counsel shall confirm that, the Holders will not recognize income, gain or loss for federal income tax purposes as a
result of such deposit and discharge and will be subject to federal income tax on the same amount and in the same manner and at the same times as would have been the case if such deposit and discharge had not occurred, 
  
 and if, in the case of either clause (1) or (2), the Company shall also pay
or cause to be paid all other sums payable hereunder by the Company, then this Indenture shall cease to be of further effect (except as to: (i) remaining rights of registration of transfer, substitution and exchange and conversion of Securities,
(ii) rights hereunder of Holders to receive payments of principal of and premium, if any, and interest on the Securities and the other rights, duties and obligations of Holders, as beneficiaries hereof with respect to the amounts, if any, so
deposited with the Trustee, and (iii) the rights, obligations and immunities of the Trustee hereunder), and the Trustee, on demand of the Company accompanied by an Officers’ Certificate and an Opinion of Counsel and at the cost and expense of
the Company, shall execute proper instruments acknowledging satisfaction of and discharging this Indenture; provided, however, that the Company shall reimburse the Trustee for all amounts due the Trustee under Section 5.8 hereof and
for any costs or expenses thereafter reasonably and properly incurred by the Trustee and to compensate the Trustee for any services thereafter reasonably and properly rendered by the Trustee in connection with this Indenture or the Securities.

  
 SECTION 3.2. Deposited Monies To Be Held in Trust. Subject to
Section 3.3 hereof, all monies deposited with the Trustee pursuant to Section 3.1 hereof shall be held in trust and applied by it to the payment, notwithstanding the provisions of Article 13 hereof, either directly or through any Paying Agent
(including the Company if acting as its own Paying Agent), to the Holders of the particular Securities for the payment or redemption of which such monies have been deposited with the Trustee, of all sums due and to become due thereon for principal,
premium, if any, and interest. All monies deposited with the Trustee pursuant to Section 3.1 hereof (and held by it or any Paying Agent) for the payment of Securities subsequently converted shall be returned to the Company upon request of the
Company. 
  
 SECTION 3.3. Return of Unclaimed Monies. The Trustee
and the Paying Agent shall pay to the Company any money held by them for the payment of principal or premium, if any, or interest that remains unclaimed for two years after the date upon which such payment shall have become due. After payment to the
Company, Holders entitled to the money must look to the Company for payment as general creditors unless an applicable abandoned property law designates another Person, and all liability of the Trustee and the Paying Agent with respect to such money
shall cease. 
  
 ARTICLE 4 
 DEFAULTS AND REMEDIES 
  
 SECTION 4.1. Events of Default. An “Event of Default” with respect to the Securities occurs when any of the following occurs (whatever
the reason for such Event of Default and whether it shall be occasioned by the provisions of Article 13 hereof or be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order,
rule or regulation of any administrative or governmental body): 
  
 (a) the Company defaults in the payment of the principal of or premium, if any, on any of the Securities when it becomes due and payable, at Maturity, upon redemption or exercise of a Repurchase Right or otherwise, whether or not such
payment is prohibited by Article 13 hereof; or 
  

 19 

 (b) the Company defaults in the payment of interest on any of the Securities when it becomes due and
payable and such default continues for a period of 30 days, whether or not such payment is prohibited by Article 13 hereof; provided, however, that the Company’s failure to pay interest on any of the Securities within five
Business Days of any Interest Payment Date prior to and including August 16, 2008 shall constitute an immediate Event of Default; or 
  
 (c) the Company fails to deliver shares of Common Stock, together with cash instead of fractional shares, when those shares of Common Stock or cash
instead of fractional shares is required to be delivered following conversion of a Security in accordance with Article 12, and that failure continues for 10 days; or 
  
 (d) the Company fails to perform or observe any other term, covenant or agreement contained in the Securities or this
Indenture and the failure continues for a period of 60 days after written notice of such failure, requiring the Company to remedy the same, shall have been given to the Company by the Trustee or to the Company and the Trustee by the Holders of at
least 25% in aggregate principal amount of the Outstanding Securities; or 
  
 (e) (i) the Company fails to make any payment by the end of the applicable grace period, if any, after the maturity of any Indebtedness for borrowed money in an amount in excess of $5,000,000 or (ii) there is an
acceleration of any Indebtedness for borrowed money in an amount in excess of $5,000,000 because of a default with respect to such Indebtedness without such Indebtedness having been discharged or such acceleration having been cured, waived,
rescinded or annulled, in the case of either (i) or (ii) above, for a period of 30 days after written notice to the Company by the Trustee or to the Company and the Trustee by Holders of at least 25% in aggregate principal amount of the Outstanding
Securities; or 
  
 (f) the Company fails to provide the Company
Notice in accordance with the terms of Section 11.3(a) hereof; or 
  
 (g) the entry by a court having jurisdiction in the premises of (i) a decree or order for relief in respect of the Company in an involuntary case or proceeding under any applicable U.S. federal or state bankruptcy, insolvency,
reorganization or other similar law or (ii) a decree or order adjudging the Company a bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment or composition of or in respect of the Company
under any applicable U.S. federal or state law, or appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company or of any substantial part of its property, or ordering the winding up or
liquidation of its affairs, 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 
  

	(h)	the commencement by the Company of a voluntary case or proceeding under any applicable U.S. 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 the Company to the entry of a decree or order for relief in respect of the Company in an involuntary case or proceeding under any applicable U.S. federal or state
bankruptcy, insolvency, reorganization or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against the Company, or the filing by the Company of a petition or answer or consent seeking reorganization or
relief under any applicable U.S. federal or state law, or the consent by the Company to the filing of such petition or to the appointment of or the taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or 

  

 20 

 of any substantial part of its property, or the making by the Company of an assignment for the benefit of
creditors, or the admission by the Company in writing of its inability to pay its debts generally as they become due, or the taking of corporate action by the Company expressly in furtherance of any such action; or 
  
 (i) the Pledge and Escrow Agreement ceases to be in full force and effect or
enforceable prior to its expiration in accordance with its terms. 
  
 SECTION 4.2. Acceleration of Maturity; Rescission and Annulment. If an Event of Default with respect to Outstanding Securities (other than an Event of Default specified in Section 4.1(g) or 4.1(h) hereof) occurs and is continuing, the
Trustee or the Holders of at least 25% in aggregate principal amount of the Outstanding Securities, by written notice to the Company and the Trustee, may declare due and payable 100% of the principal amount of all Outstanding Securities plus any
accrued and unpaid interest to the date of payment. Upon a declaration of acceleration, such principal and accrued and unpaid interest to the date of payment shall be immediately due and payable. 
  
 If an Event of Default specified in Section 4.1(g) or 4.1(h) hereof occurs,
all unpaid principal of and accrued and unpaid interest on the Outstanding Securities shall become and be immediately due and payable, without any declaration or other act on the part of the Trustee or any Holder. 
  
 The Holders of a majority in aggregate principal amount of the Outstanding
Securities by written notice to the Trustee may rescind and annul an acceleration and its consequences if: 
  
 (1) all existing Events of Default, other than the nonpayment of principal of or interest on the Securities which has become due solely because of the
acceleration, have been remedied, cured or waived, and 
  
 (2) the
rescission would not conflict with any judgment or decree of a court of competent jurisdiction; 
  
 provided, however, that in the event such declaration of acceleration has been made based on the existence of an Event of Default under
Section 4.1(e) hereof and such Event of Default has been remedied, cured or waived in accordance with Section 4.1(e) hereof, then, without any further action by the Holders, such declaration of acceleration shall be rescinded automatically and the
consequences of such declaration shall be annulled. No such rescission or annulment shall affect any subsequent Default or impair any right consequent thereon. 
  

SECTION 4.3. Other Remedies. If an Event of Default with respect to Outstanding Securities occurs and is continuing, the Trustee may pursue any
available remedy by proceeding at law or in equity to collect the payment of principal of or interest on the Securities or to enforce the performance of any provision of the Securities. 
  
 The Trustee may maintain a proceeding in which it may prosecute and enforce all rights of action and claims under this
Indenture or the Securities, even if it does not possess any of the Securities or does not produce any of them in the proceeding. 
  
 SECTION 4.4. Waiver of Past Defaults. The Holders, either (a) through the written consent of not less than a majority in aggregate principal amount of the
Outstanding Securities or (b) by the adoption of a resolution, at a meeting of Holders of the Outstanding Securities at which a quorum is present, by the Holders of at least a majority in aggregate principal amount of the Outstanding Securities
represented at such meeting, may, on behalf of the Holders of all of the Securities, waive an existing Default or Event of Default, except a Default or Event of Default: 
  
 (1) in the payment of the principal of or premium, if any, or interest on any Security (provided, however,
that subject to Section 4.7 hereof, the Holders of a majority in aggregate principal amount of the Outstanding Securities may rescind an acceleration and its consequences, including any related payment default that resulted from such acceleration);

  

 21 

 (2) in respect of the right to convert any Security in accordance with Article 12; or 
  
 (3) in respect of a covenant or provision hereof which, under Section 7.2
hereof, cannot be modified or amended without the consent of the Holder of each Outstanding Security affected. 
  
 Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; provided, however, that no such waiver shall extend to any subsequent or other Default or impair any right consequent thereon. 
  

SECTION 4.5. Control by Majority. The Holders, either (a) through the written consent of not less than a majority in aggregate principal amount of the
Outstanding Securities, or (b) by the adoption of a resolution, at a meeting of Holders of the Outstanding Securities at which a quorum is present, by the Holders of at least a majority in aggregate principal amount of the Outstanding Securities
represented at such meeting, shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee. However, the Trustee may refuse to
follow any direction that: 
  
 (1) conflicts with any law or with
this Indenture, 
  
 (2) the Trustee determines may be unduly
prejudicial to the rights of the Holders not joining therein, or 
  
 (3) may expose the Trustee to personal liability. 
  
 The
Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction. 
  
 SECTION 4.6. Limitation on Suit. No Holder of any Security shall have any right to pursue any remedy with respect to this Indenture or the Securities
(including instituting any proceeding, judicial or otherwise, with respect to this Indenture or for the appointment of a receiver or trustee) unless: 
  
 (1) such Holder has previously given written notice to the Trustee of an Event of Default that is continuing; 
  
 (2) the Holders of at least 25% in aggregate principal amount of the
Outstanding Securities shall have made written request to the Trustee to pursue the remedy; 
  
 (3) such Holder or Holders have offered to the Trustee indemnity satisfactory to it against any costs, expenses and liabilities incurred in complying with such request; 
  
 (4) the Trustee has failed to comply with the request for 60 days after its
receipt of such notice, request and offer of indemnity; and 
  
 (5) during such 60-day period, no direction inconsistent with such written request has been given to the Trustee by the Holders of a majority in aggregate principal amount of the Outstanding Securities (or such amount as shall have acted at
a meeting pursuant to the provisions of this Indenture); 
  

 22 

 provided, however, that no one or more of such Holders may use this Indenture to prejudice
the rights of another Holder or to obtain preference or priority over another Holder. 
  
 SECTION 4.7. Unconditional Rights of Holders to Receive Payment and to Convert. Notwithstanding any other provision in this Indenture, the Holder of any Security shall have the right, which is absolute and
unconditional, to receive payment of the principal of and premium, if any, and interest on such Security on the Stated Maturity expressed in such Security (or, in the case of redemption, on the Redemption Date, or in the case of the exercise of a
Repurchase Right on the Repurchase Date) and to convert such Security in accordance with Article 12, and to bring suit for the enforcement of any such payment on or after such respective dates and right to convert, and such rights shall not be
impaired or affected without the consent of such Holder. 
  
 SECTION 4.8. Collection of Indebtedness and Suits for Enforcement by the Trustee. The Company covenants that if: 
  
 (1) a Default or Event of Default occurs in the payment of any interest on any Security when such interest becomes due and payable and such Default or
Event of Default continues for a period of 30 days, or 
  
 (2) a
Default or Event of Default occurs in the payment of the principal of or premium, if any, on any Security at the Maturity thereof, the Company shall, upon demand of the Trustee, pay to it, for the benefit of the Holders of such Securities, the whole
amount then due and payable (as expressed therein or as a result of any acceleration effected pursuant to Section 4.2 hereof) on such Securities for principal and premium, if any, and interest and, to the extent that payment of such interest shall
be legally enforceable, interest on any overdue principal and premium, if any, and on any overdue interest, in each case at the Interest Rate, and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel. 
  
 If the Company fails to pay such amounts forthwith upon such demand, the Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against the Company and collect the moneys adjudged or decreed to be payable in the manner
provided by law out of the property of the Company, wherever situated. 
  
 If an Event of Default occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Holders 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 4.9. Trustee May File Proofs of Claim. In case of the pendency of any
receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to the Company or the property of the Company or its creditors, the Trustee (irrespective of whether the
principal 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 for the payment of overdue principal or interest) shall
be entitled and empowered, by intervention in such proceeding or otherwise, (1) to file and prove a claim for the whole amount of principal and premium, if any, and interest owing and unpaid in respect of the Securities and to file such other papers
or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and of the Holders of
Securities 

  

 23 

 
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 proceedings 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 5.8. 
  
 Nothing contained herein 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. 
  

SECTION 4.10. 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 the Holders shall continue as though no such proceeding had
been instituted. 
  
 SECTION 4.11. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities in the last paragraph of Section 2.12, no right or remedy conferred in this Indenture 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 hereafter existing
at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy. 
  
 SECTION 4.12. Delay or Omission Not Waiver. No delay or omission of the
Trustee or of any Holder 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 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 by the Holders of Securities, as the case may be. 
  
 SECTION 4.13. Application of Money Collected. Subject to Article 13, any
money and property collected by the Trustee pursuant to this Article shall be applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of such money and property on account of principal or premium,
if any, 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; 
  
 SECOND: To the payment of the amounts then due and unpaid for principal of and premium, if any, and interest on the
Securities and coupons in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Securities for principal and premium, if any,
and interest, respectively; and 
  
 THIRD: Any remaining amounts
shall be repaid to the Company. 
  

 24 

 SECTION 4.14. Undertaking for Costs. All parties to this Indenture agree, and each Holder of any Security
by such Holder’s acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any action
taken, suffered or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys’ fees,
against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section shall not apply to any suit instituted by the Company, to any suit
instituted by the Trustee, to any suit instituted by any Holder, or group of Holders, holding in the aggregate more than 10% in aggregate 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 premium, if any, or interest on any Security on or after the Stated Maturity expressed in such Security (or, in the case of redemption or exercise of a repurchase right, on or after the Redemption
Date) or for the enforcement of the right to convert any Security in accordance with Article 12. 
  
 SECTION 4.15. Waiver of Stay or Extension Laws. The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon,
or plead, or in any manner whatsoever claim to take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Indenture; and the Company
(to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted. 
  
 ARTICLE 5 
 THE TRUSTEE 
  
 SECTION 5.1. Certain Duties and Responsibilities. 
  
 (a) Except during the continuance of an Event of Default, 
  
 (1) The Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture or
the TIA, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and 
  
 (2) In the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; provided, however, that in the case of any such certificates or opinions which by any provision hereof are
specifically required to be furnished to the Trustee, the Trustee shall examine the certificates or opinions to determine whether or not, on their face, they conform to the requirements of this Indenture (but need not investigate or confirm the
accuracy of any facts stated therein). 
  
 (b) In case an Event of
Default actually known to a Responsible Officer of the Trustee has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a
prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs. 
  
 (c) No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to
act, or its own willful misconduct, except that: 
  
 (1) This
paragraph (c) shall not be construed to limit the effect of paragraph (a) of this Section 5.1; 
  

 25 

 (2) The Trustee shall not be liable for any error of judgment made in good faith by a Responsible
Officer, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts; and 
  
 (3) The Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with a direction received by
it of the Holders of a majority in principal amount of the Outstanding Securities (or such lesser amount as shall have acted at a meeting pursuant to the provisions of this Indenture) 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. 
  
 (d) Whether or not herein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section 5.1. 
  
 (e) No provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any liability in the performance of any of its duties hereunder, or in the exercise of any of its rights
or powers. The Trustee may refuse to perform any duty or exercise any right or power unless it receives indemnity satisfactory to it against any loss, liability, cost or expense (including, without limitation, reasonable fees of counsel).

  
 (f) The Trustee shall not be obligated to pay interest on any
money or other assets received by it unless otherwise agreed in writing with the Company. Assets held in trust by the Trustee need not be segregated from other funds except to the extent required by law. 
  
 (g) The Trustee shall not be bound to make any investigation into the facts
or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, coupon, other evidence of indebtedness or other paper or document, but the Trustee, in its
discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and
premises of the Company, personally or by agent or attorney at the sole cost of the Company, and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation. 
  
 (h) The Trustee shall not be deemed to have notice or actual knowledge of any
Default or Event of Default unless a Responsible Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact a Default or Event of Default is received by the Trustee pursuant to Section 14.2 hereof, and
such notice is received from the Company or the Holders of not less than 25% in aggregate principal amount of the Securities then outstanding and such notice references the Securities and this Indenture. 
  
 (i) The rights, privileges, protections, immunities and benefits given to the
Trustee hereunder, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and each Paying Agent, authenticating agent, Conversion Agent or Registrar
acting hereunder. 
  
 SECTION 5.2. Certain Rights of Trustee.
Subject to the provisions of Section 5.1 hereof and subject to Sections 315(a) through (d) of the TIA: 
  
 (1) The Trustee may rely on any document believed by it to be genuine and to have been signed or presented by the proper person. The Trustee need not
investigate any fact or matter stated in the document. 
  

 26 

 (2) Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate or an
Opinion of Counsel, or both. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on the Officers’ Certificate or Opinion of Counsel 
  
 (3) The Trustee may act through attorneys and agents and shall not be responsible for the misconduct or negligence of any
attorney or agent appointed with due care. 
  
 (4) The Trustee
shall not be liable for any action taken or omitted to be taken by it in good faith which it believed to be authorized or within the discretion or rights or powers conferred upon it by this Indenture, unless the Trustee’s conduct constitutes
negligence. 
  
 (5) The Trustee may consult with counsel of its
selection and the advice of such counsel as to matters of law shall be full and complete authorization and protection in respect of any action taken, omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion of
such counsel. 
  
 (6) Unless otherwise specifically provided in
this Indenture, any demand, request, direction or notice from the Company shall be sufficient if signed by an Officer of the Company. 
  
 (7) The permissive rights of the Trustee to do things enumerated in this Indenture shall not be construed as a duty unless so specified herein.

  
 SECTION 5.3. Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or any Affiliate of the Company with the same rights it would have if it were not Trustee. However, in the event that the Trustee
acquires any conflicting interest (as such term is defined in Section 310(b) of the TIA), it must eliminate such conflict within 90 days, apply to the SEC for permission to continue as trustee (to the extent permitted under Section 310(b) of the
TIA) or resign. Any agent may do the same with like rights and duties. The Trustee is also subject to Sections 5.11 and 5.12 hereof. 
  
 SECTION 5.4. Money Held in Trust. Money held by the Trustee in trust hereunder 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 expressly agreed with the Company. 
  
 SECTION 5.5. Trustee’s Disclaimer. The recitals contained herein and in the Securities (except for those in the certificate of authentication) shall
be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity, sufficiency or priority of this Indenture or of the Securities. The Trustee shall
not be accountable for the use or application by the Company of Securities or the proceeds thereof. 
  
 SECTION 5.6. Notice of Defaults. Within 90 days after the occurrence of any Default or Event of Default hereunder of which the Trustee has received
written notice, the Trustee shall give notice to Holders pursuant to Section 14.2 hereof, unless such Default or Event of Default shall have been cured or waived; provided, however, that, except in the case of a Default or Event of
Default in the payment of the principal of or premium, if any, or interest, or in the payment of any redemption or repurchase obligation, on any Security, the Trustee shall be protected in withholding such notice if and so long as Responsible
Officers of the Trustee in good faith determine that the withholding of such notice is in the interest of the Holders. 
  

 27 

 SECTION 5.7. Reports by Trustee to Holders. The Trustee shall transmit to Holders such reports concerning
the Trustee and its actions under this Indenture as may be required by Section 313 of the TIA at the times and in the manner provided by the TIA. 
  
 A copy of each report at the time of its mailing to Holders shall be filed with the SEC, if required, and each stock exchange, if any, on which the
Securities are listed. The Company shall promptly notify the Trustee when the Securities become listed on any stock exchange. 
  
 SECTION 5.8. Compensation and Indemnification. The Company covenants and agrees to pay to the Trustee from time to time, and the Trustee shall be entitled
to, reasonable compensation (which shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust) and the Company covenants and agrees to pay or reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by it or on its behalf in accordance with any of the provisions of this Indenture (including the reasonable compensation and the expenses and disbursements of its counsel and of all agents and
other persons not regularly in its employ), except to the extent that any such expense, disbursement or advance is due to its negligence or bad faith. When the Trustee incurs expenses or renders services in connection with an Event of Default
specified in Section 4.1 hereof, the expenses (including the reasonable charges and expenses of its counsel) and the compensation for the services are intended to constitute expenses of administration under any Bankruptcy Law. The Company also
covenants to indemnify the Trustee and its officers, directors, employees and agents for, and to hold such Persons harmless against, any loss, liability or expense incurred by them, arising out of or in connection with the acceptance or
administration of this Indenture or the trusts hereunder or the performance of their duties hereunder, including the costs and expenses of defending themselves against or investigating any claim of liability in the premises, except to the extent
that any such loss, liability or expense was due to the negligence or willful misconduct of such Persons. The obligations of the Company under this Section 5.8 to compensate and indemnify the Trustee and its officers, directors, employees and agents
and to pay or reimburse such Persons for expenses, disbursements and advances shall constitute additional indebtedness hereunder and shall survive the satisfaction and discharge of this Indenture or the earlier resignation or removal of the Trustee.
Such additional indebtedness shall be a senior claim to that of the Securities upon all property and funds held or collected by the Trustee as such, except funds held in trust for the benefit of the Holders of particular Securities, and the
Securities are hereby subordinated to such senior claim. “Trustee” for purposes of this Section 5.8 shall include any predecessor Trustee, but the negligence or willful misconduct of any Trustee shall not affect the indemnification of any
other Trustee. 
  
 SECTION 5.9. Replacement of Trustee. A
resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee’s acceptance of appointment as provided in this Section 5.9. 
  
 The Trustee may resign and be discharged from the trust hereby created by so
notifying the Company in writing. The Holders of at least a majority in aggregate principal amount of Outstanding Securities may remove the Trustee by so notifying the Trustee and the Company in writing. The Company must remove the Trustee if:

  
 (i) the Trustee fails to comply with Section 5.11 hereof or
Section 310 of the TIA; 
  
 (ii) the Trustee becomes incapable of
acting; 
  
 (iii) the Trustee is adjudged a bankrupt or an
insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law; or 
  
 (iv) a Custodian or public officer takes charge of the Trustee or its property. 
  

 28 

 If the Trustee resigns or is removed or if a vacancy exists in the office of the Trustee for any reason,
the Company shall promptly appoint a successor Trustee. The Trustee shall be entitled to payment of its fees and reimbursement of its expenses while acting as Trustee. Within one year after the successor Trustee takes office, the Holders of at least
a majority in aggregate principal amount of Outstanding Securities may appoint a successor Trustee to replace the successor Trustee appointed by the Company. 
  
 Any Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee if the Trustee fails
to comply with Section 5.11 hereof. 
  
 If an instrument of
acceptance by a successor Trustee shall not have been delivered to the Trustee within 30 days after the giving of such notice of resignation or removal, the resigning or removed Trustee, as the case may be, may petition, at the expense of the
Company, any court of competent jurisdiction for the appointment of a successor Trustee. 
  
 A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon the resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. The Company shall mail a notice of the successor Trustee’s succession to the Holders. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee. Notwithstanding replacement of the Trustee pursuant to this Section 5.9, the Company’s obligations under Section 5.8 hereof shall continue for the benefit of the retiring Trustee with respect to
expenses, losses and liabilities incurred by it prior to such replacement. 
  
 SECTION 5.10. Successor Trustee by Merger, Etc. Subject to Section 5.11 hereof, if the Trustee consolidates with, merges or converts into, or transfers or sells all or substantially all of its corporate trust business
to, another corporation or national banking association, the successor entity without any further act shall be the successor Trustee as to the Securities. 
  
 SECTION 5.11. Corporate Trustee Required; Eligibility. The Trustee shall at all times satisfy the requirements of Sections 310(a)(1), (2) and (5) of the
TIA. The Trustee shall at all times have (or, in the case of a corporation included in a bank holding company system, the related bank holding company shall at all times have) a combined capital and surplus of at least $100 million as set forth in
its (or its related bank holding company’s) most recent published annual report of condition. The Trustee is subject to Section 310(b) of the TIA. 
  
 SECTION 5.12. Collection of Claims Against the Company. The Trustee is subject to Section 311(a) of the TIA, excluding any creditor relationship listed in
Section 311(b) of the TIA. A Trustee who has resigned or been removed shall be subject to Section 311(a) of the TIA to the extent indicated therein. 
  
 ARTICLE 6 
 CONSOLIDATION, MERGER,
CONVEYANCE, TRANSFER OR LEASE 
  
 SECTION 6.1. Company May
Consolidate, Etc. Only on Certain Terms. The Company shall not consolidate with or merge into any other Person or convey, transfer or lease its properties and assets substantially as an entirety to any Person, and the Company shall not permit any
Person to consolidate with or merge into the Company or convey, transfer or lease its properties and assets substantially as an entirety to the Company, unless: 
  

 29 

 (1) in the event that the Company shall consolidate with or merge into another Person or convey, transfer
or lease its properties and assets substantially as an entirety to any Person, the Person formed by such consolidation or into which the Company is merged or the Person which acquires by conveyance or transfer, or which leases, the properties and
assets of the Company substantially as an entirety shall be a corporation, limited liability company, partnership or trust organized and validly existing under the laws of the United States of America, any State thereof or the District of Columbia
and, if the entity surviving such transaction or transferee entity is not the Company, then such surviving or transferee entity shall expressly assume, by an indenture supplemental hereto, executed and delivered to the Trustee, in form satisfactory
to the Trustee, the due and punctual payment of the principal of and premium, if any and interest on all the Securities and the performance of every covenant of this Indenture on the party of the Company to be performed or observed and shall have
provided for conversion rights in accordance with Section 12.11 hereof; 
  
 (2) at the time of consummation of such transaction, no Event of Default, and no event which, after notice or lapse of time or both, would become an Event of Default, shall have happened and be continuing; 
  
 (3) if as a result of such transaction the Securities become convertible into
common stock or other securities issued by any Person other than the Company, such Person fully and unconditionally guarantees all obligations of the Company or the surviving or transferee entity under the Securities and this Indenture; and

  
 (4) the Company shall have delivered to the Trustee an
Officers’ Certificate and an Opinion of Counsel, each stating that such consolidation, merger, conveyance, transfer or lease and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture comply
with this Article and that all conditions precedent herein provided for relating to such transaction have been complied with. 
  
 SECTION 6.2. Successor Substituted. Upon any consolidation or merger by the Company with or into any other Person or any conveyance, transfer or lease of
the properties and assets of the Company substantially as an entirety to any Person, in accordance with Section 6.1 hereof, the successor Person formed by such consolidation or into which the Company is merged or to which such conveyance, transfer
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 to another Person, the predecessor Person shall be relieved of all obligations and covenants under this Indenture and the Securities. 
  
 ARTICLE 7 
 AMENDMENTS, SUPPLEMENTS
AND WAIVERS 
  
 SECTION 7.1. 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 amend this Indenture and the Securities to: 
  
 (a) add to the covenants of the Company for the benefit of the Holders of
Securities; 
  
 (b) surrender any right or power herein conferred
upon the Company; 
  
 (c) make provision with respect to the
conversion rights of Holders of Securities pursuant to Section 12.11 hereof; 
  

 30 

 (d) provide for the assumption of the Company’s obligations to the Holders of Securities in the case
of a merger, consolidation, conveyance, transfer or lease pursuant to Article 6 hereof; 
  
 (e) increase the Conversion Rate; provided, however, that such increase in the Conversion Rate shall not adversely affect the interest of the Holders of Securities (after taking into account tax and
other consequences of such increase) in any material respect; 
  
 (f) comply with the requirements of the SEC in order to effect or maintain the qualification of this Indenture under the TIA; 
  
 (g) cure any ambiguity, correct or supplement any provision herein which may be inconsistent with any other provision herein or which is otherwise
defective, or make any other provisions with respect to matters or questions arising under this Indenture which the Company and the Trustee may deem necessary or desirable and which shall not be inconsistent with the provisions of this Indenture;
provided, however, that such action pursuant to this clause (g) does not, in the good faith opinion of the Board of Directors and the Trustee, adversely affect the interests of the Holders of Securities in any material respect; or

  
 (h) add or modify any other provisions with respect to matters
or questions arising under this Indenture which the Company and the Trustee may deem necessary or desirable and which shall not be inconsistent with the provisions of this Indenture, provided, however, that such action pursuant to this
clause (h) does not adversely affect the interests of the Holders of Securities in any material respect. 
  
 SECTION 7.2. With Consent of Holders of Securities. Except as provided below in this Section 7.2, this Indenture or the Securities may be amended or
supplemented, and noncompliance by the Company in any particular instance with any provision of this Indenture or the Securities may be waived, in each case (i) with the written consent of the Holders of at least a majority in aggregate principal
amount of the Outstanding Securities or (ii) by the adoption of a resolution, at a meeting of Holders of the Outstanding Securities at which a quorum is present, by the Holders of a majority in aggregate principal amount of the Outstanding
Securities represented at such meeting. 
  
 Without the written
consent or the affirmative vote of each Holder of Securities affected, an amendment or waiver under this Section 7.2 may not: 
  
 (a) change the Stated Maturity of the principal of, or any installment of interest on, any Security; 
  
 (b) reduce the principal amount of or premium, if any, on any Security;

  
 (c) reduce the Interest Rate or interest on any Security;

  
 (d) change the currency of payment of principal of, premium,
if any, or interest on any Security; 
  
 (e) impair the right of
any Holder to institute suit for the enforcement of any payment on or with respect to, or the conversion of, any Security; 
  
 (f) modify the obligation of the Company to maintain an office or agency in The City of New York pursuant to Section 9.2 hereof; 
  

 31 

 (g) except as permitted by Section 12.11 hereof, adversely affect the right to convert any Security as
provided in Article 12 hereof; 
  
 (h) adversely affect the
Repurchase Right; 
  
 (i) modify the subordination provisions of
the Securities in a manner adverse to the Holders of Securities; 
  
 (j) modify any of the provisions of this Section, Section 4.4 or Section 14.11, 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 
  
 (k) reduce the requirements of Section 8.4 hereof for quorum or voting, or reduce the percentage in aggregate 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 provided for in this Indenture. 
  
 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 7.3. Compliance with Trust Indenture Act. Every amendment to this Indenture or the Securities shall be set forth in a supplemental indenture that complies with the TIA as then in effect. 
  
 SECTION 7.4. Revocation of Consents and Effect of Consents or Votes. Until an
amendment, supplement or waiver becomes effective, a written consent to it by a Holder is a continuing consent by the Holder and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting
Holder’s Security, even if notation of the consent is not made on any Security; provided, however, that unless a record date shall have been established, any such Holder or subsequent Holder may revoke the consent as to its
Security or portion of a Security if the Trustee receives written notice of revocation before the date the amendment, supplement or waiver becomes effective. 
  
 An amendment, supplement or waiver becomes effective on receipt by the Trustee of written consents from or affirmative votes by, as the case may be, the
Holders of the requisite percentage of aggregate principal amount of the Outstanding Securities, and thereafter shall bind every Holder of Securities; provided, however, if the amendment, supplement or waiver makes a change described
in any of clauses (a) through (k) of Section 7.2 hereof, the amendment, supplement or waiver shall bind only each Holder of a Security which has consented to it or voted for it, as the case may be, and every subsequent Holder of a Security or
portion of a Security that evidences the same indebtedness as the Security of the consenting or affirmatively voting, as the case may be, Holder. 
  
 SECTION 7.5. Notation on or Exchange of Securities. If an amendment, supplement or waiver changes the terms of a Security: 
  
 (a) the Trustee may require the Holder of a Security to deliver such Security
to the Trustee, the Trustee may place an appropriate notation on the Security about the changed terms and return it to the Holder and the Trustee may place an appropriate notation on any Security thereafter authenticated; or 
  
 (b) if the Company or the Trustee so determines, the Company in exchange for
the Security shall issue and the Trustee shall authenticate a new Security that reflects the changed terms. 
  

 32 

 Failure to make the appropriate notation or issue a new Security shall not affect the validity and effect
of such amendment, supplement or waiver. 
  
 SECTION 7.6. Trustee
to Sign Amendment, Etc. The Trustee shall sign any amendment authorized pursuant to this Article 7 if the amendment does not adversely affect the rights, duties, liabilities or immunities of the Trustee. If the amendment does adversely affect the
rights, duties, liabilities or immunities of the Trustee, the Trustee may but need not sign it. In signing or refusing to sign such amendment, the Trustee shall be entitled to receive and shall be fully protected in relying upon an Officers’
Certificate and an Opinion of Counsel as conclusive evidence that such amendment is authorized or permitted by this Indenture. 
  
 ARTICLE 8 
 MEETING OF HOLDERS OF
SECURITIES 
  
 SECTION 8.1. 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. 
  
 Notwithstanding anything contained in this Article 8, the Trustee may, during the pendency of a Default or an Event of Default, call a meeting of Holders of Securities in accordance with its standard practices. 
  
 SECTION 8.2. Call Notice and Place of Meetings. 
  
 (a) The Trustee may at any time call a meeting of Holders of Securities for
any purpose specified in Section 8.1 hereof, to be held at such time and at such place in The City of New York. Notice of every meeting of Holders of Securities, setting forth the time and the place of such meeting, in general terms the action
proposed to be taken at such meeting and the percentage of the principal amount of the Outstanding Securities which shall constitute a quorum at such meeting, shall be given, in the manner provided in Section 14.2 hereof, not less than 21 nor more
than 180 days prior to the date fixed for the meeting. 
  
 (b) 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 8.1 hereof, by written request setting forth in reasonable detail the action proposed to be taken at the meeting, and the Trustee shall not have made the first publication of 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 City of New York for
such meeting and may call such meeting for such purposes by giving notice thereof as provided in paragraph (a) of this Section. 
  
 SECTION 8.3. Persons Entitled to Vote at Meetings. To be entitled to vote at any meeting of Holders of Securities, a Person shall be (a) a Holder of one
or more Outstanding Securities or (b) a Person appointed by an instrument in writing as proxy for a Holder or Holders of one or more 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. 
  
 SECTION 8.4. 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 

  

 33 

 
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 of not less than 10 days as determined by the chairman of the meeting prior to the adjournment of such adjourned meeting. Notice of the reconvening of any adjourned meeting shall be given as provided in Section 8.2(a) hereof, except that such
notice need be given only once and not less than five days prior to the date on which the meeting is scheduled to be reconvened. 
  
 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 second paragraph of Section 7.2 hereof) shall be effectively passed and decided if passed or decided by the Persons entitled to vote not less than a majority in principal amount of Outstanding Securities represented and voting 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. 
  
 SECTION 8.5. Determination of Voting Rights; Conduct and Adjournment of Meetings. 
  
 (a) 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. 
  
 (b) 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 8.2(b) hereof, 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. 
  
 (c) At any meeting, each Holder of a Security or proxy shall be entitled to
one vote for each $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. 
  
 (d) Any meeting of Holders of Securities duly called pursuant to Section 8.2 hereof at which a quorum is present may be adjourned from time to time by
Persons entitled to vote a majority in principal amount of the Outstanding Securities represented at the meeting, and the meeting may be held as so adjourned without further notice. 
  
 SECTION 8.6. 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 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 
  

 34 

 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 8.2 hereof and, if applicable, Section 8.4 hereof. 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 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 9 
 COVENANTS 
  
 SECTION 9.1. Payment of Principal, Premium and Interest. The Company will duly and punctually pay the principal of and premium, if any, and interest 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 as directed by the Trustee, no later than the day of the Stated Maturity of any Security or installment of interest, all payments so due. 
  
 SECTION 9.2. Maintenance of Offices or Agencies. The Company hereby appoints
the Trustee’s Corporate Trust Office as its office in The City of New York where Securities may be: 
  
 (i) presented or surrendered for payment; 
  
 (ii) surrendered for registration of transfer or exchange; 
  
 (iii) surrendered for conversion; 
  
 and where notices and demands to or upon the Company in respect of the Securities and this Indenture may be served. 
  
 The Company may at any time and from time to time vary or terminate the
appointment of any such office or appoint any additional offices 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 premium, if any, and interest on the Securities have been made available for payment and either paid or returned to the Company pursuant to the provisions of Section 9.3 hereof, the Company will maintain in The City of New York, an
office or agency where Securities may be presented or surrendered for payment, where Securities may be surrendered for registration of transfer or exchange, where Securities may be surrendered for conversion 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 14.2 hereof, of the appointment or termination of any such
agents and of the location and any change in the location of any such office or agency. 
  
 If at any time the Company shall fail to maintain any such required office or agency in The City of New York, or shall fail to furnish the Trustee with the address thereof, presentations and surrenders may be made at,
and notices and demands may be served on, the Corporate Trust Office of the Trustee. 
  
 SECTION 9.3. Corporate Existence. Subject to Article 6 hereof, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence, rights (charter and
statutory) and franchises; provided, however, that the Company shall not be required to preserve any such right or franchise if the Company determines that the preservation thereof is no longer desirable in the conduct of the business
of the Company and that the loss thereof is not disadvantageous in any material respect to the Holders. 
  

 35 

 SECTION 9.4. Maintenance of Properties. The Company will maintain and keep its properties and every part
thereof in such repair, working order and condition, and make or cause to be made all such needful and proper repairs, renewals and replacements thereof, as in the judgment of the Company are necessary in the interests of the Company;
provided, however, that nothing contained in this Section shall prevent the Company from selling, abandoning or otherwise disposing of any of its properties or discontinuing a part of its business from time to time if, in the judgment
of the Company, such sale, abandonment, disposition or discontinuance is advisable and does not materially adversely affect the interests or business of the Company. 
  
 SECTION 9.5. Payment of Taxes and Other Claims. The Company will, and will cause any Significant Subsidiary to, promptly pay
and discharge or cause to be paid and discharged all material taxes, assessments and governmental charges or levies lawfully imposed upon it or upon its income or profits or upon any of its property, real or personal, or upon any part thereof, as
well as all material claims for labor, materials and supplies which, if unpaid, might by law become a lien or charge upon its property; provided, however, that neither the Company nor any Significant Subsidiary shall be required to pay
or discharge or cause to be paid or discharged any such tax, assessment, charge, levy or claim if the amount, applicability or validity thereof shall currently be contested in good faith by appropriate proceedings and if the Company or such
Significant Subsidiary, as the case may be, shall have set aside on its books reserves deemed by it adequate with respect thereto. 
  
 SECTION 9.6. Reports. The Company shall deliver to the Trustee within 15 days after it files them with the SEC copies of the annual reports and of
the information, documents and other reports (or copies of such portions of any of the foregoing as the SEC may by rules and regulations prescribe) which the Company is required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange
Act; provided, however, that the Company shall not be required to deliver to the Trustee any materials for which the Company has sought and received confidential treatment by the SEC. The Company also shall comply with the other
provisions of Section 314(a) of the TIA. 
  
 SECTION 9.7.
Compliance Certificate. The Company shall deliver to the Trustee, within 90 days after the end of each fiscal year of the Company, an Officers’ Certificate stating that in the course of the performance by the signers of their duties as Officers
of the Company, they would normally have knowledge of any failure by the Company to comply with all conditions, or Default by the Company with respect to any covenants, under this Indenture, and further stating whether or not they have knowledge of
any such failure or Default and, if so, specifying each such failure or Default and the nature thereof. Within five Business Days of an Officer of the Company coming to have actual knowledge of a Default, regardless of the date, the Company shall
deliver an Officers’ Certificate to the Trustee specifying such Default and the nature and status thereof. 
  
 SECTION 9.8. [Reserved] 
 . 
  
 SECTION 9.9. Pledge and Escrow Agreement Deposit. Upon consummation of the
initial sale of the Securities, the Company shall deposit approximately $13,200,000 (and proportionately up to approximately $15,197,000 if the option set forth in Section 2(b) of the Purchase Agreement is exercised) of the net proceeds from the
initial sale of the Securities in the Escrow Account with the Escrow Agent. 
  

 36 

 ARTICLE 10 
 REDEMPTION OF SECURITIES 
  
 SECTION 10.1. Optional Redemption. The Securities are not redeemable prior to August 20, 2010. On and after August 20, 2010, the Company may, at its option, redeem the Securities in whole at any time or in part from time to time, on any
date prior to maturity, upon notice as set forth in Section 10.4, at the redemption prices (expressed as a percentage of the principal amount) set forth below (the “Optional Redemption Price”) if redeemed during the period as
described below: 
  

				
	Period	  	Redemption
Price

	 
	 Beginning on August 20, 2010 and ending on August 19, 2011
	  	101.219	%
	 Beginning on August 20, 2011 and ending on August 19, 2012
	  	100.813	%
	 August 20, 2012 and thereafter
	  	100.406	%

  
 in each case, plus any
interest accrued but not paid prior to, but excluding, the Redemption Date. 
  
 SECTION 10.2. Notice to Trustee. If the Company elects to redeem Securities pursuant to the redemption provisions of Section 10.1 hereof, it shall notify the Trustee at least 30 days prior to the Redemption Date of
such intended Redemption Date, the principal amount of Securities to be redeemed and the CUSIP numbers of the Securities to be redeemed. 
  
 SECTION 10.3. Selection of Securities to Be Redeemed. If fewer than all the Securities are to be redeemed, the Trustee, subject to the procedures of the
Depository, shall select the particular Securities to be redeemed from the Outstanding Securities by a method that complies with the requirements of any exchange on which the Securities are listed, or, if the Securities are not listed on an
exchange, on a pro rata basis or by lot or in accordance with any other method the Trustee considers fair and appropriate. Securities and portions thereof that the Trustee selects shall be in amounts equal to the minimum authorized denominations for
Securities to be redeemed or any integral multiple thereof. 
  
 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 to be the portion selected
for redemption (provided, however, that the Holder of such Security so converted and deemed redeemed shall not be entitled to any additional interest payment as a result of such deemed redemption than such Holder would have otherwise
been entitled to receive upon conversion of such Security). Securities which 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 the 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 10.4. Notice of Redemption. Notice of redemption shall be given in the manner provided in Section 14.2 hereof to the Holders of Securities to
be redeemed. Such notice shall be given not less than 20 nor more than 60 days prior to the Redemption Date. All notices of redemption shall state: 
  
 (1) the Redemption Date; 
  

 37 

 (2) the Redemption Price and interest accrued and unpaid to the Redemption Date, if any; 
  
 (3) if fewer than all the 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 accrued and unpaid to the Redemption Date, if any, will
become due and payable upon each such Security to be redeemed, and that interest thereon shall cease to accrue on and after such date; 
  
 (5) the Conversion Rate, the date on which the right to convert the principal of the Securities to be redeemed will terminate and the places where such
Securities may be surrendered for conversion; 
  
 (6) the place or
places where such Securities are to be surrendered for payment of the Redemption Price and accrued and unpaid interest, if any; and 
  
 (7) the CUSIP number of the Securities. 
  
 The notice given shall specify the last date on which exchanges or transfers of Securities may be made pursuant to Section 2.7 hereof, and shall specify
the serial numbers of Securities and the portions thereof called for redemption. 
  
 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 request, by the Trustee in the name of and at the expense of the Company.

  
 If the Company requests the Trustee to give such notice, it
shall set forth the information required by this Section 10.4 in an Officers’ Certificate and will deliver such Officers’ Certificate to the Trustee 45 days prior to the Redemption Date (unless the Trustee consents to a shorter period).

  
 SECTION 10.5. Effect of Notice of Redemption. Notice of
redemption having been given as provided in Section 10.4 hereof, 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 and accrued and unpaid interest) such Securities shall cease to bear interest. Upon surrender of any such Security for redemption in accordance with such notice, such Security shall be paid by the
Company at the Redemption Price plus accrued and unpaid interest, if any; provided, however, that the installments of interest on Securities whose Stated Maturity is prior to or on the Redemption 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 2.1 hereof. 
  
 If any Security called for redemption shall not be so paid upon surrender thereof for redemption, the principal and premium,
if any, shall, until paid, bear interest from the Redemption Date at the Interest Rate. 
  
 SECTION 10.6. Deposit of Redemption Price. Prior to or on any Redemption Date before 11 a.m. New York City time, the Company shall deposit with the Trustee or with a Paying Agent an amount of money sufficient to pay
the Redemption Price of all the Securities to be redeemed on that Redemption Date, other than any Securities called for redemption on that date which have been converted prior to the date of such deposit, and accrued and unpaid interest, if any, on
such Securities. 
  
 If any Security called for redemption is
converted, any money deposited with the Trustee or with a Paying Agent 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 fourth to last paragraph of Section 2.1 hereof) be paid to the Company on Company Request or, if then held by the Company, shall be discharged from such trust. 
  

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 SECTION 10.7. Securities Redeemed in Part. Any Security which is to be redeemed only in part shall be
surrendered at an office or agency of the Company designated for that purpose pursuant to Section 9.2 hereof (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 the Holder’s attorney duly authorized in writing), and the Company shall execute, and the Trustee shall authenticate and deliver to the Holder of such Security without service
charge, a new Security or Securities of 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. 
  
 ARTICLE 11 
 REPURCHASE OF SECURITIES 
  
 SECTION 11.1. Repurchase Right Upon Fundamental Change 
 . 
  
 (a) In the event that a Fundamental Change shall occur, each Holder shall have the right (the “Repurchase
Right”), at the Holder’s option, but subject to the provisions of Section 11.3 hereof, to require the Company to repurchase, and upon the exercise of such right the Company shall repurchase, all of such Holder’s Securities not
theretofore called for redemption, or any portion of the principal amount thereof that is equal to $1,000 or any integral multiple thereof (provided, however, 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 $1,000 or integral multiples thereof), on the date (the “Repurchase Date”) that is 45 days after the date of the Company Notice at a purchase
price equal to 100% of the principal amount of the Securities to be repurchased (the “Repurchase Price”), plus interest accrued and unpaid to, but excluding, the Repurchase Date; provided, however, that installments of
interest on Securities whose Stated Maturity is prior to or on 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 2.1 hereof. 
  
 (b) Subject to the
fulfillment by the Company of the conditions set forth in Section 11.2 hereof, the Company may elect to pay the Repurchase Price by delivering that number of shares of Common Stock equal to (i) the Repurchase Price divided by (ii) 95% of the average
of the daily volume-weighted average price of the Common Stock for the twenty (20) consecutive Trading Days immediately preceding and including the third Business Day prior to the Repurchase Date (if the third Business Day prior to the Repurchase
Date is a Trading Day, or if not, then on the last Trading Day prior to the third Business Day), appropriately adjusted to take into account the occurrence, during the period commencing on the first Trading Day during the twenty Trading-Day period
and ending on the Repurchase Date of any event that would result in an adjustment to the conversion rate set forth in Section 12.1(c). 
  
 (c) Whenever in this Indenture (including Sections 2.2, 4.1(a) and 4.7 hereof) or Exhibit A annexed hereto 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, payable in respect to such Security to the extent that such Repurchase Price is, was or would be so payable at such time, and
express mention of the Repurchase Price in any provision of this Indenture shall not be construed as excluding the Repurchase Price in those provisions of this Indenture when such express mention is not made; provided, however, that
for the purposes of Article 13 hereof, such reference shall be deemed to include reference to the Repurchase Price only to the extent the Repurchase Price is payable in cash. 
  

 39 

 SECTION 11.2. Conditions to the Company’s Election to Pay the Repurchase Price in Common Stock

 . 
  
 (a) The shares of Common Stock to be issued upon repurchase of Securities hereunder: 
  
 (i) shall not require registration under any federal securities law before such shares may be freely transferable without
being subject to any transfer restrictions under the Securities Act upon repurchase or, if such registration is required, such registration shall be completed and shall become effective prior to the Repurchase Date; and 
  
 (ii) shall not require registration with, or approval of, any governmental
authority under any state law or any other federal law before shares may be validly issued or delivered upon repurchase or if such registration is required or such approval must be obtained, such registration shall be completed or such approval
shall be obtained prior to the Repurchase Date. 
  
 (b) The shares
of Common Stock to be listed upon repurchase of Securities hereunder are, or shall have been, approved for listing on the Nasdaq National Market or the New York Stock Exchange or listed on another national securities exchange, in any case, prior to
the Repurchase Date. 
  
 (c) All shares of Common Stock which may
be issued upon repurchase of Securities will be issued out of the Company’s authorized but unissued Common Stock and will, upon issue, be duly and validly issued and fully paid and nonassessable and free of any preemptive or similar rights.

  
 (d) If any of the conditions set forth in clauses (a) through
(c) of this Section 11.2 are not satisfied in accordance with the terms thereof, the Repurchase Price shall be paid by the Company only in cash. 
  
 SECTION 11.3. Notices; Method of Exercising Repurchase Right, Etc 
 . 
  
 (a) Unless the Company shall have theretofore
called for redemption all of the Outstanding Securities, prior to or on the 30th day after the occurrence of a Fundamental Change, the Company, or, at the written request and expense of the Company prior to or on the 30th day after such occurrence,
the Trustee shall give to all Holders of Securities notice, in the manner provided in Section 14.2 hereof, of the occurrence of the Fundamental Change and of the Repurchase Right set forth herein arising as a result thereof (the “Company
Notice”). The Company shall also deliver a copy of such notice of a Repurchase Right to the Trustee. Each notice of a Repurchase Right shall state: 
  
 (1) the Repurchase Date; 
  
 (2) the date by which the Repurchase Right must be exercised; 
  
 (3) the Repurchase Price and accrued and unpaid interest, if any, and whether the Repurchase Price shall be paid by the Company in cash or by delivery of
shares of Common Stock; 
  
 (4) a description of the procedure
which 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 and unpaid interest, if any; 
  

 40 

 (5) that on the Repurchase Date the Repurchase Price and accrued and unpaid interest, if any, will become
due and payable upon each such Security designated by the Holder to be repurchased, and that interest thereon shall cease to accrue on and after said date; 
  
 (6) the Conversion Rate then in effect, the date on which the right to convert the principal amount of the Securities to be repurchased will terminate and
the place where such Securities may be surrendered for conversion; 
  
 (7) the place or places where such Securities, together with the Option to Elect Repayment Upon a Change of Control certificate included in Exhibit A annexed hereto are to be delivered for payment of the Repurchase Price and accrued
and unpaid interest, if any; and 
  
 (8) whether a Make-Whole
Premium shall be payable by the Company upon conversion. 
  
 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 11 are
inconsistent with applicable law, such law shall govern. 
  
 (b)
To exercise a Repurchase Right, a Holder shall deliver to the Trustee prior to or on the 30th day after the date of the Company Notice: 
  
 (1) 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 be repurchased in part, the serial number thereof, the portion of the principal amount thereof to be repurchased) and a statement that an election to exercise the Repurchase Right is being
made thereby, and, in the event that the Repurchase Price shall be paid in shares of Common Stock, the name or names (with addresses) in which the certificate or certificates for shares of Common Stock shall be issued, and 
  
 (2) the Securities with respect to which the Repurchase Right is being
exercised. 
  
 Such written notice shall be irrevocable, except
that the right of the Holder to convert the Securities with respect to which the Repurchase Right is being exercised shall continue until the close of business on the Business Day immediately preceding the Repurchase Date. 
  
 (c) In the event a Repurchase Right shall be exercised in accordance with the
terms hereof, the Company shall pay or cause to be paid to the Trustee the Repurchase Price in cash for payment to the Holder on the Repurchase Date or, if shares of Common Stock are to be paid, shares of Common Stock, as provided above, as promptly
after the Repurchase Date as practicable, together with accrued and unpaid interest to the Repurchase Date payable in cash with respect to the Securities as to which the Repurchase Right has been exercised; provided, however, that
installments of interest that mature prior to or on 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. 
  
 (d) 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
Interest Rate, and each 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. 
  

 41 

 (e) Any Security which 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. 
  
 (f) Any issuance of shares of Common Stock in respect of the Repurchase Price shall be deemed to have been effected immediately prior to the close of
business on the Repurchase Date and the Person or Persons in whose name or names any certificate or certificates for shares of Common Stock shall be issuable upon such repurchase shall be deemed to have become on the Repurchase Date the holder or
holders of record of the shares represented thereby; provided, however, that any surrender for repurchase on a date when the stock transfer books of the Company shall be closed shall constitute the Person or Persons in whose name or
names the certificate or certificates for such shares are to be issued as the record holder or holders thereof for all purposes at the opening of business on the next succeeding day on which such stock transfer books are open. No payment or
adjustment shall be made for dividends or distributions on any Common Stock issued upon repurchase of any Security declared prior to the Repurchase Date. 
  
 (g) No fractions of shares of Common Stock shall be issued upon repurchase of any Security or Securities. If more than one Security shall be repurchased
from the same Holder and the Repurchase Price shall be payable in shares of Common Stock, the number of full shares which shall be issued upon such repurchase shall be computed on the basis of the aggregate principal amount of the Securities (or
specified portions thereof) to be so repurchased. Instead of any fractional share of Common Stock which would otherwise be issued on the repurchase of any Security or Securities (or specified portions thereof), the Company shall pay a cash
adjustment in respect of such fraction (calculated to the nearest one-100th of a share) in an amount equal to the same fraction of the Quoted Price of the Common Stock as of the Trading Day preceding the Repurchase Date. 
  
 (h) Any issuance and delivery of certificates for shares of Common Stock on
repurchase of Securities shall be made without charge to the Holder of Securities being repurchased for such certificates or for any tax or duty in respect of the issuance or delivery of such certificates or the Securities represented thereby;
provided, however, that the Company shall not be required to pay any tax or duty which may be payable in respect of (i) income of the Holder or (ii) any transfer involved in the issuance or delivery of certificates for shares of Common
Stock in a name other than that of the Holder of the Securities being repurchased, and no such issuance or delivery shall be made unless the Persons requesting such issuance or delivery 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. 
  
 (i) 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 2.15 hereof. 
  
 ARTICLE 12 
 CONVERSION OF SECURITIES 
  
 SECTION 12.1. Conversion Right and Conversion Rate. 
  
 (a) Subject to and upon compliance with the provisions of this Article, at the option of the Holder thereof, any Security or any portion of the principal amount thereof which is $1,000 or an integral 
  

 42 

 multiple of $1,000 may be converted at the principal amount thereof, or of such portion thereof, into the
number of duly authorized, fully paid and nonassessable shares of Common Stock at the Conversion Rate, determined as hereinafter provided, in effect at the time of conversion. Such conversion right shall expire at the close of business on August 16,
2013. 
  
 (b) In case a Security or portion thereof is called for
redemption, such conversion right in respect of the Security or the portion so called, shall expire at the close of business on the Business Day immediately preceding the Redemption Date, unless the Company defaults in making the payment due upon
redemption. In the case of a Fundamental Change for which the Holder exercises its Repurchase Right with respect to a Security or portion thereof, such conversion right in respect of the Security or portion thereof shall expire at the close of
business on the Business Day preceding the Repurchase Date. 
  
 (c) The rate at which shares of Common Stock shall be delivered upon conversion (the “Conversion Rate”) shall be initially equal to 37.0370 shares of Common Stock per $1,000 principal amount of Securities. The Conversion
Rate shall be adjusted in certain instances as provided in paragraphs (a), (b), (c), (d), (e), (f), (h) and (l) of Section 12.4 hereof. 
  
 (d) If a Holder converts its Securities in connection with a Fundamental Change, such Holder will be entitled to receive an amount, payable in Common
Stock equal to the Make-Whole Premium pursuant to Section 12.13, in addition to the shares of Common Stock deliverable upon conversion of the Securities. 
  
 SECTION 12.2. Exercise of Conversion Right. To exercise the conversion right, the Holder of any Security to be converted shall surrender such Security
duly endorsed or assigned to the Company or in blank, at the office of any Conversion Agent, accompanied by a duly signed conversion notice substantially in the form attached to the Security to the Company 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 to be converted. 
  
 Any Holder which surrenders any Security for conversion during the period between the close of business on any Regular Record Date and ending with the
opening of business on the corresponding Interest Payment Date (except in the case of any Security whose Maturity is prior to such Interest Payment Date) shall be accompanied by payment in New York Clearing House funds or other funds acceptable to
the Company of an amount equal to the interest to be received on such Interest Payment Date on the principal amount of the Security being surrendered for conversion (but excluding any overdue interest on the principal amount of such Security so
converted that exists at the time such Holder surrenders such Security for conversion). Notwithstanding the foregoing, any such Holder which surrenders for conversion any Security (a) which has been called for redemption by the Company in a notice
of redemption given by the Company pursuant to Section 10.4 hereof on a Redemption Date after such Regular Record Date and on or prior to the next succeeding Interest Payment Date or (b) with respect to which the Company has specified a Repurchase
Date that is after such Regular Record Date and on or prior to the next succeeding Interest Payment Date, in either case, need not pay the Company an amount equal to the interest in the principal amount of such Security so converted at the time such
Holder surrenders such Security for conversion. 
  
 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 cause to be issued and delivered to such Conversion Agent a certificate or certificates for the number of full shares of Common Stock issuable upon conversion, together with payment in lieu of any fraction of a
share as provided in Section 12.3 hereof. 
  

 43 

 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 aggregate principal amount equal to the unconverted portion of the principal
amount of such Securities. 
  
 The Company hereby initially
appoints the Trustee as the Conversion Agent. 
  
 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 issued 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 which would otherwise be
issued upon conversion of any Security or Securities (or specified portions thereof), the Company shall pay a cash adjustment in respect of such fraction (calculated to the nearest one-100th of a share) in an amount equal to the same fraction of the
Quoted Price of the Common Stock as of the Trading Day preceding the date of conversion. 
  
 SECTION 12.4. Adjustment of Conversion Rate 
 . The Conversion Rate shall be subject to adjustments, calculated by the
Company, from time to time as follows: 
  
 (a) In case the Company
shall hereafter pay a dividend or make a distribution to all holders of the outstanding Common Stock in shares of Common Stock, the Conversion Rate in effect at the opening of business on the date following the date fixed for the determination of
stockholders entitled to receive such dividend or other distribution shall be increased by multiplying such Conversion Rate by a fraction: 
  
 (i) the numerator of which shall be the number of shares of Common Stock outstanding at the close of business on the Record Date (as defined in Section
12.4(g)) fixed for such determination and the total number of shares constituting such dividend or other distribution, and 
  
 (ii) the denominator of which shall be the number of shares of Common Stock outstanding at the close of business on the Record Date (as defined in Section
12.4(g)) fixed for such determination. 
  
 Such increase shall
become effective immediately after the opening of business on the day following the Record Date. If any dividend or distribution of the type described in this Section 12.4(a) is declared but not so paid or made, the Conversion Rate shall again be
adjusted to the Conversion Rate which would then be in effect if such dividend or distribution had not been declared. 
  
 (b) In case the outstanding shares of Common Stock shall be subdivided 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 combination becomes effective shall be proportionately reduced, such increase or reduction, as 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. 
  
 (c) In case the Company shall issue rights or warrants (other than any rights or warrants referred to in Section 12.4(d)) to all or substantially all
holders of its outstanding shares of Common Stock entitling them to subscribe for or purchase shares of Common Stock (or securities convertible into Common 
  

 44 

 Stock) at a price per share (or having a conversion price per share) less than the Current Market Price
(as defined in Section 12.4(g)) on the Record Date fixed for the determination of stockholders entitled to receive such rights or warrants, the Conversion Rate shall be increased so that the same shall equal the rate determined by multiplying the
Conversion Rate in effect at the opening of business on the date after such Record Date by a fraction: 
  
 (i) the numerator of which shall be the number of shares of Common Stock outstanding on the close of business on the Record Date plus the total number of
additional shares of Common Stock so offered for subscription or purchase (or into which the convertible securities so offered are convertible), and 
  
 (ii) the denominator of which shall be the number of shares of Common Stock outstanding at the close of business on the Record Date plus the number of
shares which the aggregate offering price of the total number of shares so offered for subscription or purchase (or the aggregate conversion price of the convertible securities so offered) would purchase at such Current Market Price. 
  
 Such adjustment shall become effective immediately after the opening of
business on the day following the Record Date fixed for determination of stockholders entitled to receive such rights or warrants. To the extent that shares of Common Stock (or securities convertible into Common Stock) are not delivered pursuant to
such rights or warrants, upon the expiration or termination of such rights or warrants the Conversion Rate shall be readjusted to the Conversion Rate which would then be in effect had the adjustments made upon the issuance of such rights or warrants
been made on the basis of the delivery of only the number of shares of Common Stock (or securities convertible into Common Stock) actually delivered. In the event that such rights or warrants are not so issued, the Conversion Rate shall again be
adjusted to be the Conversion Rate which would then be in effect if such date fixed for the determination of stockholders entitled to receive such rights or warrants had not been fixed. In determining whether any rights or warrants entitle the
holders to subscribe for or purchase shares of Common Stock at less than such Current Market Price, and in determining the aggregate offering price of such shares of Common Stock, there shall be taken into account any consideration received for such
rights or warrants, the value of such consideration if other than cash, to be determined by the Board of Directors. 
  
 (d) In case the Company shall, by dividend or otherwise, distribute to all or substantially all holders of its Common Stock shares of any class of capital
stock of the Company (other than any dividends or distributions to which Section 12.4(a) applies) or evidences of its indebtedness, cash or other assets, including securities, but excluding (1) any rights or warrants referred to in Section 12.4(c),
(2) any stock, securities or other property or assets (including cash) distributed in connection with a reclassification, change, merger, consolidation, statutory share exchange, combination, sale or conveyance to which Section 12.11 hereof applies
and (3) dividends and distributions paid exclusively in cash (the securities described in foregoing clauses (1), (2) and (3) hereinafter in this Section 12.4(d) called the “securities”), then, in each such case, subject to the second
succeeding paragraph of this Section 12.4(d), the Conversion Rate shall be increased so that the same shall be equal to the rate determined by multiplying the Conversion Rate in effect immediately prior to the close of business on the Record Date
(as defined in Section 12.4(g)) with respect to such distribution by a fraction: 
  
 (i) the numerator of which shall be the Current Market Price (determined as provided in Section 12.4(g)) on such date, and 
  
 (ii) the denominator of which shall be such Current Market Price on such date less the fair market value (as determined by the Board of Directors (except
as described below), whose determination shall be conclusive and set forth in a Board Resolution) on such date of the portion of the shares of capital stock, evidences of indebtedness, cash or other assets, including securities, so distributed
applicable to one share of Common Stock (determined on the basis of the number of shares of the Common Stock outstanding on the Record Date). 
  

 45 

 Such increase shall become effective immediately prior to the opening of business on the day following
the Record Date, 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. However, in the event that the then fair market value (as so determined) of the portion
of the securities so distributed applicable to one share of Common Stock is equal to or greater than the Current Market Price on the Record Date, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have
the right to receive upon conversion of a Security (or any portion thereof) the amount of shares of capital stock, evidences of indebtedness, cash or other assets, including securities, such Holder would have received had such Holder converted such
Security (or portion thereof) immediately prior to such Record Date. In the event that such dividend or distribution is not so paid or made, the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such
dividend or distribution had not been declared. 
  
 If the Board
of Directors determines the fair market value of any distribution for purposes of this Section 12.4(d) by reference to the actual or when issued trading market for any securities comprising all or part of such distribution, it must in doing so
consider the prices in such market over the same period (the “Reference Period”) used in computing the Current Market Price pursuant to Section 12.4(g) to the extent possible, unless the Board of Directors in a Board Resolution determines
in good faith that determining the fair market value during the Reference Period would not be in the best interest of the Holder. 
  
 In the event the Company distributes shares of capital stock of a Subsidiary or other business unit of the Company, the Conversion Rate will be adjusted,
if at all, so that the same shall be equal to the rate determined by multiplying the Conversion Rate in effect immediately prior to the close of business on the Record Date (as defined in Section 12.4(g)) with respect to such distribution by a
fraction: 
  
 (i) the numerator of which shall be the Current
Market Price (determined as described below) on such date plus the fair market value on such date of the portion of the shares of capital stock of such Subsidiary or other business unit of the Company so distributed applicable to one share of Common
Stock (determined on the basis of the number of shares of the Common Stock outstanding on the Record Date), and 
  
 (ii) the denominator of which shall be such Current Market Price on such date (determined as described below). 
  
 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 ten (10) consecutive Trading Days commencing on and including the fifth Trading Day of such securities after the effectiveness of the Spin-off (the
“Measurement Period”) and the Current Market Price shall be calculated over the same Measurement Period; provided, however, 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
Price for the Common Stock on the same Trading Day. 
  
 Rights or
warrants distributed by the Company to all holders of Common Stock entitling the holders thereof to subscribe for or purchase shares of the Company’s capital stock (either initially or under certain circumstances), which rights or warrants,
until the occurrence of a specified event or events (“Trigger Event”): 
  
 (i) are deemed to be transferred with such shares of Common Stock, 
  

 46 

 (ii) are not exercisable, and 
  
 (iii) are also issued in respect of future issuances of Common Stock 
  
 shall be deemed not to have been distributed for purposes of this Section
12.4(d) (and no adjustment to the Conversion Rate under this Section 12.4(d) will be required) until the occurrence of the earliest Trigger Event. If such right or warrant is subject to subsequent events, upon the occurrence of which such right or
warrant shall become exercisable to purchase different securities, evidences of indebtedness or other assets or entitle the holder to purchase a different number or amount of the foregoing or to purchase any of the foregoing at a different purchase
price, then the occurrence of each such event shall be deemed to be the date of issuance and record date with respect to a new right or warrant (and a termination or expiration of the existing right or warrant without exercise by the holder
thereof). In addition, in the event of any distribution (or deemed distribution) of rights or warrants, or any Trigger Event or other event (of the type described in the preceding sentence) with respect thereto, that resulted in an adjustment to the
Conversion Rate under this Section 12.4(d): 
  
 (1) in the case of
any such rights or warrants which 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 warrant (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 such rights or warrants all of which shall have expired or been terminated without exercise, the Conversion Rate shall be readjusted as
if such rights and warrants had never been issued. 
  
 For
purposes of this Section 12.4(d) and Sections 12.4(a), 12.4(b) and 12.4(c), any dividend or distribution to which this Section 12.4(d) is applicable that also includes shares of Common Stock, a subdivision or combination of Common Stock to which
Section 12.4(b) applies, or rights or warrants to subscribe for or purchase shares of Common Stock to which Section 12.4(c) applies (or any combination thereof), shall be deemed instead to be: 
  
 (1) a dividend or distribution of the evidences of indebtedness, assets,
shares of capital stock, rights or warrants other than such shares of Common Stock, such subdivision or combination or such rights or warrants to which Sections 12.4(a), 12.4(b) and 12.4(c) apply, respectively (and any Conversion Rate increase
required by this Section 12.4(d) with respect to such dividend or distribution shall then be made), immediately followed by 
  
 (2) a dividend or distribution of such shares of Common Stock, such subdivision or combination or such rights or warrants (and any further Conversion Rate
increase required by Sections 12.4(a), 12.4(b) and 12.4(c) with respect to such dividend or distribution shall then be made), except: 
  
 (A) the Record Date of such dividend or distribution shall be substituted as (x) ”the date fixed for the determination of stockholders entitled to
receive such dividend or other distribution”, “Record Date fixed for such determination” and “Record Date” within the meaning of Section 12.4(a), (y) ”the day upon which such subdivision becomes effective” and
“the day upon which such combination becomes effective” within the meaning of Section 12.4(b), and (z) ”the Record Date fixed for the determination of stockholders entitled to receive such rights or warrants,” such “Record
Date,” “the Record 

  

 47 

 
Date fixed for the determination of stockholders entitled to receive such rights or warrants” and “such date fixed for the determination of
stockholders entitled to receive such rights or warrants” within the meaning of Section 12.4(c), and 
  
 (B) any shares of Common Stock included in such dividend or distribution shall not be deemed “outstanding at the close of business on the Record Date
fixed for such determination” within the meaning of Section 12.4(a) and any reduction or increase in the number of shares of Common Stock resulting from such subdivision or combination shall be disregarded in connection with such dividend or
distribution. 
  
 (e) In case the Company shall, by dividend or
otherwise, distribute to all or substantially all holders of its Common Stock cash (excluding any cash that is distributed upon a reclassification, change, merger, consolidation, statutory share exchange, combination, sale or conveyance to which
Section 12.11 hereof applies or as part of a distribution referred to in Section 12.4(d) hereof), then and in each such case, immediately after the close of business on such date, the Conversion Rate shall be increased so that the same shall equal
the rate determined by multiplying the Conversion Rate in effect immediately prior to the close of business on such Record Date by a fraction: 
  
 (i) the numerator of which shall be equal to the Current Market Price on the Record Date, and 
  
 (ii) the denominator of which shall be equal to the Current Market Price on
such date less an amount equal to the quotient of (x) the sum of the aggregate amount of cash so distributed and (y) the number of shares of Common Stock outstanding on the Record Date. 
  
 In the event that such dividend or distribution is not so paid or made, the Conversion Rate shall again be adjusted to be
the Conversion Rate which would then be in effect if such dividend or distribution had not been declared. 
  
 (f) In case a tender or exchange offer made by the Company or any of its subsidiaries for all or any portion of the Common Stock shall expire, then, and
in each such case, immediately prior to the opening of business on the day after the date of the last time (the “Expiration Time”) tenders could have been made pursuant to such tender or exchange offer, the Conversion Rate shall be
adjusted so that the same shall equal the rate determined by multiplying the Conversion Rate in effect immediately prior to close of business on the date of the Expiration Time by a fraction: 
  
 (i) the numerator of which shall be the sum of (x) the fair market value
(determined as aforesaid) of the aggregate consideration payable to stockholders based on the acceptance (up to any maximum specified in the terms of the tender or exchange offer) of all shares validly tendered or exchanged and not withdrawn as of
the Expiration Time (the shares deemed so accepted, up to any such maximum, being referred to as the “Purchased Shares”) and (y) the product of the number of shares of Common Stock outstanding (less any Purchased Shares) on the
Expiration Time and the Current Market Price of the Common Stock on the Trading Day next succeeding the Expiration Time, and 
  
 (ii) the denominator shall be (x) the number of shares of Common Stock outstanding (including any tendered or exchanged shares) at the Expiration Time
multiplied by the Current Market Price of the Common Stock on the Trading Day next succeeding the Expiration Time. 
  
 Such increase (if any) shall become effective immediately prior to the opening of business on the day following the Expiration Time. 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 such 
  

 48 

 purchases or all such purchases are rescinded, the Conversion Rate shall again be adjusted to be the
Conversion Rate which would then be in effect if such tender or exchange offer had not been made. If the application of this Section 12.4(f) to any tender or exchange offer would result in an decrease in the Conversion Rate, no adjustment shall be
made for such tender or exchange offer under this Section 12.4(f). 
  
 (g) For purposes of this Section 12.4, the following terms shall have the meanings indicated: 
  
 (1) “Current Market Price” shall mean the average of the daily Closing Prices per share of Common Stock for the ten (10) consecutive
Trading Days immediately prior to the date in question; provided, however, that if: 
  
 (i) the “ex” date (as hereinafter defined) for any event (other than the issuance or distribution requiring such computation) that requires an
adjustment to the Conversion Rate pursuant to Section 12.4(a), (b), (c), (d), (e) or (f) occurs during such ten consecutive Trading Days, the Closing Price for each Trading Day prior to the “ex” date for such other event shall be adjusted
by dividing such Closing Price by the same fraction by which the Conversion Rate is so required to be adjusted as a result of such other event; 
  
 (ii) the “ex” date for any event (other than the issuance or distribution requiring such computation) that requires an adjustment to the
Conversion Rate pursuant to Section 12.4(a), (b), (c), (d), (e) or (f) occurs on or after the “ex” date for the issuance or distribution requiring such computation and prior to the day in question, the Closing Price for each Trading Day on
and after the “ex” date for such other event shall be adjusted by dividing such Closing Price by the reciprocal of the fraction by which the Conversion Rate is so required to be adjusted as a result of such other event; and 
  
 (iii) the “ex” date for the issuance or distribution requiring such
computation is prior to the day in question, after taking into account any adjustment required pursuant to clause (i) or (ii) of this proviso, the Closing Price for each Trading Day on or after such “ex” date shall be adjusted by adding
thereto the amount of any cash and the fair market value (as determined by the Board of Directors in a manner consistent with any determination of such value for purposes of Section 12.4(d) or (f), whose determination shall be conclusive and set
forth in a Board Resolution) of the evidences of indebtedness, shares of capital stock or assets being distributed applicable to one share of Common Stock as of the close of business on the day before such “ex” date. 
  
 For purposes of any computation under Section 12.4(f), the Current Market
Price of the Common Stock on any date shall be deemed to be the average of the daily Closing Prices per share of Common Stock for such day and the next two succeeding Trading Days; provided, however, that if the “ex” date for
any event (other than the tender offer requiring such computation) that requires an adjustment to the Conversion Rate pursuant to Section 12.4(a), (b), (c), (d), (e) or (f) occurs on or after the Expiration Time for the tender or exchange offer
requiring such computation and prior to the day in question, the Closing Price for each Trading Day on and after the “ex” date for such other event shall be adjusted by dividing such Closing Price by the reciprocal of the fraction by which
the Conversion Rate is so required to be adjusted as a result of such other event. For purposes of this paragraph, the term “ex” date, when used: 
  
 (A) with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the relevant exchange or in the
relevant market from which the Closing Price was obtained without the right to receive such issuance or distribution; 
  

 49 

 (B) with respect to any subdivision or combination of shares of Common Stock, means the first date on
which the Common Stock trades regular way on such exchange or in such market after the time at which such subdivision or combination becomes effective, and 
  
 (C) with respect to any tender or exchange offer, means the first date on which the Common Stock trades regular way on such exchange or in such market
after the Expiration Time of such offer. 
  
 Notwithstanding the
foregoing, whenever successive adjustments to the Conversion Rate are called for pursuant to this Section 12.4, such adjustments shall be made to the Current Market Price as may be necessary or appropriate to effectuate the intent of this Section
12.4 and to avoid unjust or inequitable results as determined in good faith by the Board of Directors. 
  
 (1) “fair market value” shall mean the amount which a willing buyer would pay a willing seller in an arm’s length transaction.

  
 (2) “Record Date” shall mean, with respect to
any dividend, distribution or other transaction or event in which the holders of Common Stock have the right to receive any cash, securities or other property or in which the Common Stock (or other applicable security) is exchanged for or converted
into any combination of cash, securities or other property, the date fixed for determination of stockholders entitled to receive such cash, securities or other property (whether such date is fixed by the Board of Directors or by statute, contract or
otherwise). 
  
 (h) The Company may make such increases in the
Conversion Rate, in addition to those required by Section 12.4(a), (b), (c), (d), (e) or (f), as the Board of Directors considers to be advisable to avoid or diminish any income tax to holders of Common Stock or rights to purchase Common Stock
resulting from any dividend or distribution of stock (or rights to acquire stock) or from any event treated as such for income tax purposes. 
  
 To the extent permitted by applicable law, the Company from time to time may increase the Conversion Rate by any amount for any period of time if the
period is at least 20 days and the increase is irrevocable during the period and the Board of Directors determines in good faith that such increase would be in the best interests of the Company, which determination shall be conclusive and set forth
in a Board Resolution; provided, however, that in no event may the Company increase the Conversion Rate such that it causes the Conversion Price to be less than the par value of a share of Common Stock. Whenever the Conversion Rate is
increased pursuant to the preceding sentence, the Company shall mail to the Trustee and each Holder at the address of such Holder as it appears in the Register a notice of the increase at least 15 days prior to the date the increased Conversion Rate
takes effect, and such notice shall state the increased Conversion Rate and the period during which it will be in effect. 
  
 (i) All calculations under this Article 12 shall be made by the Company and shall be made to the nearest cent or to the nearest one-ten-thousandth
(1/10,000) of a share, as the case may be. No adjustment need be made for a change in the par value or no par value of the Common Stock. 
  
 (j) In any case in which this Section 12.4 provides that an adjustment shall become effective immediately after a Record Date for an event, the Company
may defer until the occurrence of such event (i) issuing to the Holder of any Security converted after such Record Date and before the occurrence of such event the additional shares of Common Stock issuable upon such conversion by reason of the
adjustment required by such event over and above the Common Stock issuable upon such conversion before giving effect to such adjustment and (ii) paying to such holder any amount in cash in lieu of any fraction pursuant to Section 12.3 hereof.

  

 50 

 (k) For purposes of this Section 12.4, the number of shares of Common Stock at any time outstanding shall
not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not pay any dividend or make any distribution on shares
of Common Stock held in the treasury of the Company. 
  
 (l) To
the extent the Company has a Rights Plan in effect upon conversion of the Securities pursuant to this Article 12: (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 12 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; or (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. 
  
 SECTION 12.5. Notice of Adjustments of
Conversion Rate. Whenever the Conversion Rate is adjusted as herein provided (other than in the case of an adjustment pursuant to the second paragraph of Section 12.4(h) for which the notice required by such paragraph has been provided), the Company
shall promptly file with the Trustee and any Conversion Agent other than the Trustee an Officers’ Certificate setting forth the adjusted Conversion Rate and showing in reasonable detail the facts upon which such adjustment is based. Promptly
after delivery of such Officers’ Certificate, the Company shall prepare a notice stating that the Conversion Rate has been adjusted and setting forth the adjusted Conversion Rate and the date on which each adjustment becomes effective, and
shall mail such notice to each Holder at the address of such Holder as it appears in the Register within 20 days of the effective date of such adjustment. Failure to deliver such notice shall not affect the legality or validity of any such
adjustment. 
  
 SECTION 12.6. Notice Prior to Certain Actions. In
case at any time after the date hereof: 
  
 (1) the Company shall
declare a dividend (or any other distribution) on its Common Stock payable otherwise than in cash out of its capital surplus or its consolidated retained earnings; 
  
 (2) the Company shall authorize the granting to the holders of its Common Stock of rights or warrants to subscribe for or
purchase any shares of capital stock of any class (or of securities convertible into shares of capital stock of any class) or of any other rights; 
  
 (3) there shall occur any reclassification of the Common Stock of the Company (other than a subdivision or combination of its outstanding Common Stock, a
change in par value, a change from par value to no par value or a change from no par value to par value), or any merger, consolidation, statutory share exchange or combination to which the Company is a party and for which approval of any
shareholders of the Company is required, or the sale, transfer or conveyance of all or substantially all of the assets of the Company; or 
  
 (4) there shall occur the voluntary or involuntary dissolution, liquidation or winding up of the Company; 
  
 the Company shall cause to be filed at each office or agency maintained for
the purpose of conversion of securities pursuant to Section 9.2 hereof, and shall cause to be provided to the Trustee and all Holders in accordance with Section 14.2 hereof, 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: 
  

 51 

 (A) the date on which a record is to be taken for the purpose of such dividend, distribution, rights or
warrants, or, if a record is not to be taken, the date as of which the holders of Common Stock of record to be entitled to such dividend, distribution, rights or warrants are to be determined, or 
  
 (B) the date on which such reclassification, merger, consolidation, statutory
share exchange, combination, sale, transfer, conveyance, dissolution, liquidation or winding up is expected to become effective, and the date as of which it is expected that holders of Common Stock of record shall be entitled to exchange their
shares of Common Stock for securities, cash or other property deliverable upon such reclassification, merger, consolidation, statutory share exchange, sale, transfer, dissolution, liquidation or winding up. 
  
 Neither the failure to give such notice nor any defect therein shall affect
the legality or validity of the proceedings or actions described in clauses (1) through (4) of this Section 12.6. 
  
 SECTION 12.7. Company to Reserve Common Stock. The Company shall at all times use its best efforts to 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 fully paid and nonassessable Common Stock then issuable upon the conversion of all Outstanding
Securities, including pursuant to any Make-Whole Premium. 
  
 SECTION 12.8. Taxes on Conversions. Except as provided in the next sentence, the Company will pay any and all taxes (other than taxes on income) and duties that may be payable in respect of the issue or delivery of shares of Common Stock on
conversion of Securities pursuant hereto. A Holder delivering a Security for conversion shall be liable for and will be required to pay any tax or duty which may be payable in respect of any transfer involved in the issue and delivery of shares of
Common Stock in a name other than that of the Holder of the Security or Securities to be converted, and no such issue or delivery shall be made unless the Person requesting such issue has paid to the Company the amount of any such tax or duty, or
has established to the satisfaction of the Company that such tax or duty has been paid. 
  
 SECTION 12.9. Covenant as to Common Stock. The Company covenants that all shares of Common Stock which may be issued upon conversion of Securities will upon issue be fully paid and nonassessable 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 to be canceled by or at the
direction of the Trustee, which shall dispose of the same as provided in Section 2.15. 
  
 SECTION 12.11. Effect of Recapitalization, Reclassification, Consolidation, Merger or Sale. If any of following events occur, namely: 
  
 (i) any recapitalization, reclassification or change of the outstanding shares of Common Stock (other than a change in par
value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination), 
  
 (ii) any merger, consolidation, statutory share exchange or combination of the Company with another corporation as a result of which holders of Common
Stock shall be entitled to receive stock, securities or other property or assets (including cash) with respect to or in exchange for such Common Stock or 
  

 52 

 (iii) any sale, conveyance or lease of the properties and assets of the Company as, or substantially as,
an entirety to any other corporation as a result of which holders of Common Stock shall be entitled to receive stock, securities or other property or assets (including cash) with respect to or in exchange for such Common Stock, 
  
 the Company or the successor or purchasing corporation, as the case may be,
shall execute with the Trustee a supplemental indenture (which shall comply with the TIA as in force at the date of execution of such supplemental indenture if such supplemental indenture is then required to so comply) providing that each Security
shall be convertible into the kind and amount of shares of stock and other securities or property or assets (including cash) which such Holder would have been entitled to receive upon such recapitalization, reclassification, change, merger,
consolidation, statutory share exchange, combination, sale or conveyance had such Securities been converted into Common Stock immediately prior to such recapitalization, reclassification, change, merger, consolidation, statutory share exchange,
combination, sale or conveyance assuming such holder of Common Stock did not exercise its rights of election, if any, as to the kind or amount of securities, cash or other property receivable upon such recapitalization, reclassification, change,
merger, consolidation, statutory share exchange, combination, sale or conveyance (provided that, if the kind or amount of securities, cash or other property receivable upon such recapitalization, reclassification, change, merger,
consolidation, statutory share exchange, combination, sale or conveyance is not the same for each share of Common Stock in respect of which such rights of election shall not have been exercised (“Non-Electing Share”), then for the
purposes of this Section 12.11 the kind and amount of securities, cash or other property receivable upon such recapitalization, reclassification, change, merger, consolidation, statutory share exchange, combination, sale or conveyance for 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 which shall be as nearly equivalent as may be practicable to
the adjustments provided for in this Article 12. If, in the case of any such recapitalization, reclassification, change, merger, consolidation, statutory share exchange, combination, sale or conveyance, the stock or other securities and assets
receivable thereupon by a holder of shares of Common Stock includes shares of stock or other securities and assets of a corporation other than the successor or purchasing corporation, as the case may be, in such recapitalization, reclassification,
change, merger, consolidation, statutory share exchange, combination, sale or conveyance, then such supplemental indenture shall also be executed by such other corporation and shall contain such additional provisions to protect the interests of the
Holders of the Securities as the Board of Directors shall reasonably consider necessary by reason of the foregoing, including to the extent practicable the provisions providing for the repurchase rights set forth in Article 11 hereof. 
  
 The Company shall cause notice of the execution of such supplemental
indenture to be mailed to each Holder, at the address of such Holder as it appears on the Register, within 20 days after execution thereof. Failure to deliver such notice shall not affect the legality or validity of such supplemental indenture.

  
 The above provisions of this Section shall similarly apply to
successive recapitalizations, reclassifications, mergers, consolidations, statutory share exchanges, combinations, sales and conveyances. 
  
 If this Section 12.11 applies to any event or occurrence, Section 12.4 hereof shall not apply. 
  
 SECTION 12.12. Responsibility of Trustee for Conversion Provisions. The
Trustee, subject to the provisions of Section 5.1 hereof, 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 intent of any such adjustments when made, or with respect to the method employed, or herein or in any supplemental indenture provided to be employed, in making the same. Neither the Trustee, subject
to the provisions of Section 5.1 hereof, nor any Conversion Agent shall be accountable with respect to the validity or value (of the kind or amount) of any Common Stock, or of any other securities or property, which may at any time be issued or
delivered upon the 
  

 53 

 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 5.1 hereof, nor any Conversion Agent shall be responsible for any failure of the Company to make any cash payment or to issue, transfer or deliver any shares of stock or share certificates or other securities or
property upon the surrender of any Security for the purpose of conversion; and the Trustee, subject to the provisions of Section 5.1 hereof, and any Conversion Agent shall not be responsible or liable for any failure of the Company to comply with
any of the covenants of the Company contained in this Article. 
  
 SECTION 12.13. Make-Whole Premium 
 . 
  
 (a) If a Fundamental Change Effective Date occurs on or prior to August 20, 2010, other than in connection with a Fundamental Change described in clause
(3) of the definition of “Change of Control,” Holders who convert Securities in accordance with the provisions of Section 11.3(a) in connection with a Fundamental Change shall, subject to Section 12.13, be entitled to receive a
“Make-Whole Premium” consisting of an increase in the Conversion Rate. The Make-Whole Premium shall be calculated by the Company and paid for in shares of Common Stock or in any other consideration into which the Securities are then
convertible. The number of additional shares of Common Stock by which the Conversion Rate shall increase shall be determined by reference to the table below and shall equal the number of shares of Common Stock for the applicable Fundamental Change
Effective Date and Stock Price of such Fundamental Change. If the applicable Fundamental Change Effective Date and/or Stock Price is not set forth in the table: (i) if the applicable Fundamental Change Effective Date and/or Stock Price is between
two Fundamental Change Effective Dates or Stock Prices, as the case may be, set forth in the table, the Make-Whole Premium shall be determined by a straight-line interpolation between the Make-Whole Premiums set forth for the two Fundamental Change
Effective Dates and/or Stock Prices, as the case may be, set forth in the table based on a 365-day year, (ii) if the Stock Price on the Fundamental Change Effective Date exceeds $100 a share, subject to adjustment as set forth herein, no Make-Whole
Premium shall be paid, and (iii) if the Stock Price on the Fundamental Change Effective Date is less than $21.60 a share, subject to adjustment as set forth herein, no Make-Whole Premium shall be paid. 
  

																												
	Stock Price
	 Effective Date
	  	$	21.60	  	$	22.50	  	$	25.00	  	$	27.50	  	$	30.00	  	$	32.50	  	$	35.00	  	$	37.50	  	$	40.00
	 	  	
	
	  	
	
	  	
	
	  	
	
	  	
	
	  	
	
	  	
	
	  	
	
	  	
	

	 July 1, 2005
	  	 	9.2593	  	 	8.6257	  	 	7.2258	  	 	6.1984	  	 	5.4230	  	 	4.8228	  	 	4.3473	  	 	3.9627	  	 	3.6459
	 August 20, 2006
	  	 	9.2593	  	 	7.8900	  	 	6.4547	  	 	5.4262	  	 	4.6703	  	 	4.1001	  	 	3.6598	  	 	3.3116	  	 	3.0306
	 August 20, 2007
	  	 	9.2593	  	 	7.4074	  	 	5.6217	  	 	4.5756	  	 	3.8337	  	 	3.2946	  	 	2.8933	  	 	2.5868	  	 	2.3474
	 August 20, 2008
	  	 	9.2593	  	 	7.4074	  	 	4.7274	  	 	3.6395	  	 	2.9056	  	 	2.4023	  	 	2.0497	  	 	1.7964	  	 	1.6089
	 August 20, 2009
	  	 	9.2593	  	 	7.4074	  	 	3.7245	  	 	2.5456	  	 	1.8192	  	 	1.3761	  	 	1.1048	  	 	0.9349	  	 	0.8241
	 August 20, 2010
	  	 	0.0000	  	 	0.0000	  	 	0.0000	  	 	0.0000	  	 	0.0000	  	 	0.0000	  	 	0.0000	  	 	0.0000	  	 	0.0000

  

 54 

																												
	Stock Price
	 Effective Date
	  	$	42.50	  	$	45.00	  	$	47.50	  	$	50.00	  	$	60.00	  	$	70.00	  	$	80.00	  	$	90.00	  	$	100.00
	 	  	
	
	  	
	
	  	
	
	  	
	
	  	
	
	  	
	
	  	
	
	  	
	
	  	
	

	 July 5, 2005
	  	 	3.3805	  	 	3.1547	  	 	2.9602	  	 	2.7859	  	 	2.2998	  	 	1.9612	  	 	1.7127	  	 	1.5218	  	 	1.3699
	 August 20, 2006
	  	 	2.7994	  	 	2.6058	  	 	2.4411	  	 	2.3021	  	 	1.8696	  	 	1.5926	  	 	1.3901	  	 	1.2344	  	 	1.1106
	 August 20, 2007
	  	 	2.1557	  	 	1.9988	  	 	1.8678	  	 	1.7569	  	 	1.4471	  	 	1.2359	  	 	1.0814	  	 	0.9624	  	 	0.8676
	 August 20, 2008
	  	 	1.4658	  	 	1.3530	  	 	1.2616	  	 	1.1873	  	 	0.9711	  	 	0.8283	  	 	0.7233	  	 	0.6419	  	 	0.5771
	 August 20, 2009
	  	 	0.7477	  	 	0.6913	  	 	0.6471	  	 	0.6165	  	 	0.5142	  	 	0.4412	  	 	0.3868	  	 	0.3446	  	 	0.3108
	 August 20, 2010
	  	 	0.0000	  	 	0.0000	  	 	0.0000	  	 	0.0000	  	 	0.0000	  	 	0.0000	  	 	0.0000	  	 	0.0000	  	 	0.0000

  
 The Stock Prices set
forth in the table above shall be adjusted as of any date on which the Conversion Rate of the Securities is adjusted by multiplying each such Stock Price in effect immediately prior to such adjustment by a fraction, the numerator of which shall be
the Conversion Rate in effect immediately prior to the adjustment giving rise to the Stock Price adjustment and the denominator of which shall be the Conversion Rate as so adjusted. The number of additional shares set forth in the table above shall
be adjusted in the same manner as the Conversion Rate as set forth in Section 12.4 hereof. 
  
 Delivery of the payment of the Make-Whole Premium shall be upon the later of (x) the settlement date of the conversion of Securities by the Holder and (y) promptly following the Fundamental Change Effective Date.

  
 (b) A conversion of Securities by a Holder will be deemed for
the purposes of this Section 12.13 to be “in connection with” a Fundamental Change if the conversion notice delivered by the Holder pursuant to Section 12.2 hereof is received by a Conversion Agent (i) on or subsequent to the date that is
15 calendar days prior to the date announced by the Company as the anticipated Fundamental Change Effective Date but (ii) prior to the close of business on the Business Day immediately preceding the related Repurchase Date. The Company shall notify
the Holders of an anticipated Fundamental Change Effective Date at least 20 calendar days prior to such Fundamental Change Effective Date. 
  
 (c) Notwithstanding any of the provisions of this Section 12.13, in no event shall the Conversion Rate exceed 46.2963 shares per $1,000 principal amount
of Securities (subject to adjustment as provided herein). 
  

 55 

 ARTICLE 13 
 SUBORDINATION 
  
 SECTION
13.1. Securities Subordinated to Senior Debt. The Company covenants and agrees, and each Holder of Securities, by such Holder’s acceptance thereof, likewise covenants and agrees, that the Indebtedness represented by the Securities and the
payment of the principal of and premium, if any, and interest on each and all of the Securities is hereby expressly subordinated and junior, to the extent and in the manner set forth and as set forth in this Section 13.1, in right of payment to the
prior payment in full of all Senior Debt; provided, however, that the Securities, the Indebtedness represented thereby and the payment of the principal of and premium, if any, and interest on the Securities in all respects shall rank
equally with, or prior to, all existing and future Indebtedness of the Company that is expressly subordinated to any Senior Debt. 
  
 (a) In the event of any distribution of assets of the Company upon any dissolution, winding up, liquidation or reorganization of the Company, whether in
bankruptcy, insolvency, reorganization or receivership proceedings or upon an assignment for the benefit of creditors or any other marshalling of the assets and liabilities of the Company or otherwise, the holders of all Senior Debt shall first be
entitled to receive payment of the full amount due thereon in respect of all such Senior Debt and all other amounts due or provision shall be made for such amount in cash, or other payments satisfactory to the holders of Senior Debt, before the
Holders of any of the Securities are entitled to receive any payment or distribution of any character, whether in cash, securities or other property, on account of the principal of or premium, if any, or interest on the Securities. 
  
 (b) In the event of any acceleration of Maturity of the Securities because of
an Event of Default, unless the full amount due in respect of all Senior Debt is paid in cash or other form of payment satisfactory to the holders of Senior Debt, no payment shall be made by the Company with respect to the principal of, premium, if
any, or interest on the Securities or to acquire any of the Securities (including any redemption, conversion or cash repurchase pursuant to the exercise of the Repurchase Right or otherwise), and the Company shall give prompt written notice of such
acceleration to such holders of Senior Debt. 
  
 (c) In the event
of and during the continuance of any default in payment of the principal of or premium, if any, or interest on, rent or other payment obligation in respect of, any Senior Debt, unless all such payments due in respect of such Senior Debt have been
paid in full in cash or other payments satisfactory to the holders of Senior Debt, no payment shall be made by the Company with respect to the principal of, premium, if any, or interest on the Securities or to acquire any of the Securities
(including any redemption, conversion or cash repurchase pursuant to the exercise of the Repurchase Right). The Company shall give prompt written notice to the Trustee of any default under any Senior Debt or under any agreement pursuant to which
Senior Debt may have been issued. 
  

	(d)	During the continuance of any event of default with respect to any Designated Senior Debt, as such event of default is defined under any such Designated Senior Debt or in any
agreement pursuant to which any Designated Senior Debt has been issued (other than a default in payment of the principal of or premium, if any, or interest on, rent or other payment obligation in respect of any Designated Senior Debt), permitting
the holder or holders of such Designated Senior Debt to accelerate the maturity thereof (or in the case of any lease, permitting the landlord either to terminate the lease or to require the Company to make an irrevocable offer to terminate the lease
following an event of default thereunder), no payment shall be made by the Company, directly or indirectly, with respect to principal of, premium, if any, or interest on the Securities for 179 days following notice in writing (a “Payment
Blockage Notice”) to the Company, from any holder or holders of such Designated Senior Debt or their representative or representatives or the trustee or trustees under any indenture or under which any instrument evidencing any such
Designated Senior Debt may 

  

 56 

 have been issued, that such an event of default has occurred and is continuing, unless such event of
default has been cured or waived or such Designated Senior Debt has been paid in full in cash or other payment satisfactory to the holders of such Designated Senior Debt; provided, however, if the maturity of such Designated Senior
Debt is accelerated (or in the case of any lease, as a result of such event of default, the landlord under the lease has given the Company notice of its intention to terminate the lease or to require the Company to make an irrevocable offer to
terminate the lease following an event of default thereunder), no payment may be made on the Securities until such Designated Senior Debt has been paid in full in cash or other payment satisfactory to the holders of such Designated Senior Debt or
such acceleration (or termination, in the case of a lease) has been cured or waived. 
  
 For purposes of this Section 13.1(d), such Payment Blockage Notice shall be deemed to include notice of all other events of default under such indenture or instrument which are continuing at the time of the event of
default specified in such Payment Blockage Notice. The provisions of this Section 13.1(d) shall apply only to one such Payment Blockage Notice given in any period of 365 days with respect to any issue of Designated Senior Debt, and no such
continuing event of default that existed or was continuing on the date of delivery of any Payment Blockage Notice shall be, or shall be made, the basis for a subsequent Payment Blockage Notice. 
  
 (e) In the event that, notwithstanding the foregoing provisions of Sections
13.1(a), 13.1(b), 13.1(c) and 13.1(d), any payment on account of principal, premium, if any, or interest on the Securities shall be made by or on behalf of the Company and received by the Trustee, by any Holder or by any Paying Agent (or, if the
Company is acting as its own Paying Agent, money for any such payment shall be segregated and held in trust): 
  
 (i) after the occurrence of an event specified in Section 13.1(a) or 13.1(b), then, unless all Senior Debt is paid in full in cash, or provision shall be
made therefor, 
  
 (ii) after the happening of an event of default
of the type specified in Section 13.1(c) above, then, unless the amount of such Senior Debt then due shall have been paid in full, or provision made therefor or such event of default shall have been cured or waived, or 
  
 (iii) after the happening of an event of default of the type specified in
Section 13.1(d) above and delivery of a Payment Blockage Notice, then, unless such event of default shall have been cured or waived or the 179-day period specified in Section 13.1(d) shall have expired, 
  
 such payment (subject, in each case, to the provisions of Section 13.7
hereof) shall be held in trust for the benefit of, and shall be immediately paid over to, the holders of Designated Senior Debt (unless an event described in Section 13.1(a), (b) or (c) has occurred, in which case the payment shall be held in trust
for the benefit of, and shall be immediately paid over to all holders of Senior Debt) or their representative or representatives or the trustee or trustees under any indenture under which any instruments evidencing any of the Designated Senior Debt
or Senior Debt, as the case may be, may have been issued, as their interests may appear. 
  
 SECTION 13.2. Subrogation. Subject to the payment in full of all Senior Debt to which the Indebtedness evidenced by the Securities is in the circumstances subordinated as provided in Section 13.1 hereof, the
Holders of the Securities shall be subrogated to the rights of the holders of such Senior Debt to receive payments or distributions of cash, property or securities of the Company applicable to such Senior Debt until all amounts owing on the
Securities shall be paid in full, and, as between the Company, its creditors other than holders of such Senior Debt, and the Holders of the Securities, no such payment or distribution made to the holders of Senior Debt by virtue of this Article
which otherwise would have been made to the holders of the Securities shall be deemed to be a payment by the Company on account of such 
  

 57 

 Senior Debt; provided, however, that the provisions of this Article are and are intended solely for the
purpose of defining the relative rights of the Holders of the Securities, on the one hand, and the holders of Senior Debt, on the other hand. 
  
 SECTION 13.3. Obligation of the Company Is Absolute and Unconditional. Nothing contained in this Article or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as between the Company, its creditors other than the holders of Senior Debt, and the Holders of the Securities, the obligation of the Company, which is absolute and unconditional, to pay to the Holders of
the Securities the principal of and premium, if any, and interest on the Securities as and when the same shall become due and payable in accordance with their terms, or is intended to or shall affect the relative rights of the Holders of the
Securities and creditors of the Company other than the holders of Senior Debt, nor shall anything contained herein or therein prevent the Trustee or the Holder of any Security from exercising all remedies otherwise permitted by applicable law upon
default under this Indenture, subject to the rights, if any, under this Article of the holders of Senior Debt in respect of cash, property or securities of the Company received upon the exercise of any such remedy. 
  
 SECTION 13.4. Maturity of or Default on Senior Debt. Upon the maturity of any
Senior Debt by lapse of time, acceleration or otherwise, all principal of or premium, if any, or interest on, rent or other payment obligations in respect of all such matured Senior Debt shall first be paid in full, or such payment shall have been
duly provided for, before any payment on account of principal, or premium, if any, or interest is made upon the Securities. 
  
 SECTION 13.5. Payments on Securities Permitted. Except as expressly provided in this Article, nothing contained in this Article shall affect the
obligation of the Company to make, or prevent the Company from making, payments of the principal of, or premium, if any, or interest on the Securities in accordance with the provisions hereof and thereof, or shall prevent the Trustee or any Paying
Agent from applying any moneys deposited with it hereunder to the payment of the principal of, or premium, if any, or interest on the Securities. 
  
 SECTION 13.6. Effectuation of Subordination by Trustee. Each Holder of Securities, by such Holder’s acceptance thereof, authorizes and directs the
Trustee on such Holder’s behalf to take such action as may be necessary or appropriate to effectuate the subordination provided in this Article and appoints the Trustee such Holder’s attorney-in-fact for any and all such purposes.

  
 Upon any payment or distribution of assets of the Company
referred to in this Article, the Trustee and the Holders of the Securities shall be entitled to rely upon any order or decree made by any court of competent jurisdiction in which any such dissolution, winding up, liquidation or reorganization
proceeding affecting the affairs of the Company is pending or upon a certificate of the trustee in bankruptcy, receiver, assignee for the benefit of creditors, liquidating trustee or agent or other Person making any payment or distribution,
delivered to the Trustee or to the Holders of the Securities, for the purpose of ascertaining the Persons entitled to participate in such payment or distribution, and as to other facts pertinent to the right of such Persons under this Article, and
if such evidence is not furnished, the Trustee may defer any payment to such Persons pending judicial determination as to the right of such Persons to receive such payment. 
  
 SECTION 13.7. Knowledge of Trustee. Notwithstanding the provision of this Article or any other provisions of this Indenture,
the Trustee shall not be charged with knowledge of the existence of any Senior Debt, of any default in payment of principal of, premium, if any, or interest on, rent or other payment obligation in respect of any Senior Debt, or of any facts which
would prohibit the making of any payment of moneys to or by the Trustee, or the taking of any other action by the Trustee, unless a Responsible Officer of the Trustee having responsibility for the administration of the trust established by this
Indenture shall have received written notice thereof from the Company, any Holder of Securities, any Paying or Conversion Agent 
  

 58 

 of the Company or the holder or representative of any class of Senior Debt, and, prior to the receipt of any such written
notice, the Trustee shall be entitled in all respects to assume that no such default or facts exist; provided, however, that unless on the third Business Day prior to the date upon which by the terms hereof any such moneys may become
payable for any purpose the Trustee shall have received the notice provided for in this Section 13.7, then, anything herein contained to the contrary notwithstanding, the Trustee shall have full power and authority to receive such moneys and apply
the same to the purpose for which they were received, and shall not be affected by any notice to the contrary which may be received by it on or after such date. 
  

SECTION 13.8. Trustee’s Relation to Senior Debt. The Trustee shall be entitled to all the rights set forth in this Article with respect to any
Senior Debt at the time held by it, to the same extent as any other holder of Senior Debt and nothing in this Indenture shall deprive the Trustee of any of its rights as such holder. 
  
 Nothing contained in this Article shall apply to claims of or payments to the Trustee under or pursuant to Section 5.8
hereof. 
  
 With respect to the holders of Senior Debt, the
Trustee undertakes to perform or to observe only such of its covenants and obligations as are specifically set forth in this Article, and no implied covenants or obligations with respect to the holders of Senior Debt shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior Debt and the Trustee shall not be liable to any holder of Senior Debt if it shall pay over or deliver to Holders, the Company or any
other Person moneys or assets to which any holder of Senior Debt shall be entitled by virtue of this Article or otherwise. 
  
 SECTION 13.9. Rights of Holders of Senior Debt Not Impaired. No right of any present or future holder of any Senior Debt to enforce the subordination
herein shall at any time or in any way be prejudiced or impaired by any act or failure to act on the part of the Company or by any noncompliance by the Company with the terms, provisions and covenants of this Indenture, regardless of any knowledge
thereof any such holder may have or be otherwise charged with. 
  
 SECTION 13.10. Modification of Terms of Senior Debt. Any renewal or extension of the time of payment of any Senior Debt or the exercise by the holders of Senior Debt of any of their rights under any instrument creating or evidencing Senior
Debt, including without limitation the waiver of default thereunder, may be made or done all without notice to or assent from the Holders of the Securities or the Trustee. 
  
 No compromise, alteration, amendment, modification, extension, renewal or other change of, or waiver, consent or other
action in respect of, any liability or obligation under or in respect of, or of any of the terms, covenants or conditions of any indenture or other instrument under which any Senior Debt is outstanding or of such Senior Debt, whether or not such
release is in accordance with the provisions or any applicable document, shall in any way alter or affect any of the provisions of this Article or of the Securities relating to the subordination thereof. 
  
 SECTION 13.11. Certain Conversions Not Deemed Payment. For the purposes of
this Article 13 only: 
  
 (1) the issuance and delivery of junior
securities upon conversion of Securities in accordance with Article 12 hereof shall not be deemed to constitute a payment or distribution on account of the principal of, premium, if any, or interest on Securities or on account of the purchase or
other acquisition of Securities, and 
  

 59 

 (2) the payment, issuance or delivery of cash (except in satisfaction of fractional shares pursuant to
Section 12.3 hereof), property or securities (other than junior securities) upon conversion of a Security shall be deemed to constitute payment on account of the principal of, premium, if any, or interest such Security. 
  
 For the purposes of this Section 13.11, the term “junior
securities” means: 
  
 (a) shares of any common stock of
the Company or 
  
 (b) other securities of the Company that are
subordinated in right of payment to all Senior Debt 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. 
  
 Nothing contained in this Article 13 or
elsewhere in this Indenture or in the Securities is intended to or shall impair, as among the Company, its creditors (other than holders of Senior Debt) and the Holders of Securities, the right, which is absolute and unconditional, of the Holder of
any Security to convert such Security in accordance with Article 12 hereof. 
  
 SECTION 13.12. Relation to Other Indebtedness. The Securities shall be “Designated Senior Debt” for purposes of the indenture governing the Company’s 43⁄4% Convertible Subordinated Notes due 2007.
Additionally, the Securities shall rank on parity with the Company’s outstanding 2.0% Senior Subordinated Convertible Debentures due 2023 and the Company’s outstanding 23⁄4% Senior Subordinated Convertible Notes due 2012. 
  
 ARTICLE 14 
 OTHER PROVISIONS OF GENERAL APPLICATION 
  
 SECTION 14.1. Trust Indenture Act Controls. This Indenture is subject to the provisions of the TIA which are required to be part of this Indenture, and
shall, to the extent applicable, be governed by such provisions. 
  
 SECTION 14.2. Notices. Any notice or communication to the Company or the Trustee is duly given if in writing and delivered in person or mailed by first-class mail to the address set forth below: 
  
 (a) if to the Company: 
  
 CV Therapeutics, Inc. 
 3172 Porter Drive 
 Palo Alto, California
94304 
 Attention: General Counsel 
  
 with a copy (which shall not constitute notice) to: 
  
 Latham & Watkins LLP 
 135 Commonwealth
Drive 
 Menlo Park, CA 94025 
 Attention: Alan C. Mendelson 
  

 60 

 (b) if to the Trustee: 
  
 Wells Fargo Bank, National Association 
 Sixth & Marquette Avenue 
 MAC N9303-120 
 Minneapolis, MN 55479 
 Attention: Corporate
Trust Services / CV Therapeutics Administrator 
  
 The Company or
the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications. 
  
 Any notice or communication to a Holder shall be mailed by first-class mail to his address shown on the Register kept by the Registrar. Failure to mail a
notice or communication to a Holder or any defect in such notice or communication shall not affect its sufficiency with respect to other Holders. 
  
 If a notice or communication is mailed or sent in the manner provided above within the time prescribed, it is duly given as of the date it is mailed,
whether or not the addressee receives it, except that notice to the Trustee shall only be effective upon receipt thereof by the Trustee. 
  
 If the Company mails a notice or communication to Holders, it shall mail a copy to the Trustee at the same time. 
  
 SECTION 14.3. Communication by Holders with Other Holders. Holders may
communicate pursuant to Section 312(b) of the TIA with other Holders with respect to their rights under the Securities or this Indenture. The Company, the Trustee, the Registrar and anyone else shall have the protection of Section 312(c) of the TIA.

  
 SECTION 14.4. Acts of Holders of Securities. 
  
 (a) Any request, demand, authorization, direction, notice, consent, waiver or
other action provided by this Indenture to be given or taken by Holders of Securities may be embodied in and evidenced by: 
  
 (1) one or more instruments of substantially similar tenor signed by such Holders in person or by agent or proxy duly appointed in writing; 
  
 (2) 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 8; or 
  

(3) a combination of such instruments and any such record. 
  
 Except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments or record or both are delivered to
the Trustee and, where it is hereby expressly required, to the Company. Such instrument or instruments and record (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the “Act” of the Holders 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 5.1 hereof) 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 8.6 hereof. 
  

 61 

 (b) The fact and date of the execution by any Person of any such instrument or writing may be provided in
any manner which the Trustee reasonably deems sufficient. 
  
 (c)
The principal amount and serial numbers of Securities held by any Person, and the date of such Person holding the same, shall be proved by the Register. 
  
 (d) Any request, demand, authorization, direction, notice, consent, election, waiver or other Act of the Holders of any 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 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. 
  
 SECTION 14.5. Certificate and Opinion as to Conditions Precedent. In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such
matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents. 
  
 Any certificate or opinion of an officer of the Company may be based, insofar as it relates to legal matters, upon an Opinion of Counsel, unless such
officer knows, or in the exercise of reasonable care should know, that the Opinion of Counsel with respect to the matters upon which such certificate or opinion is based is erroneous. Any such Opinion of Counsel may be based, insofar as it relates
to factual matters, upon a certificate or representations by, an officer or officers of the Company stating that the information with respect to such factual matters is in the possession of the Company, unless such counsel knows, or in the exercise
of reasonable care should know, that the certificate or representations with respect to such matters are erroneous. 
  
 Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and form one instrument. 
  
 Upon any application or request by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the
Trustee an Officers’ Certificate stating that all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with and an Opinion of Counsel stating that in the opinion of such Counsel all
such conditions precedent, if any, have been complied with, except that in the case of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Indenture relating to such
particular application or request, no additional certificate or opinion need be furnished. 
  
 SECTION 14.6. Statements Required in Certificate or Opinion. Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include: 
  
 (1) a statement that each individual signing such certificate or opinion on
behalf of the Company has read such covenant or condition and the definitions herein relating thereto; 
  
 (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; 
  

 62 

 (3) a statement that, in the opinion of each such individual, he has made such examination or
investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and 
  
 (4) a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with. 
  
 SECTION 14.7. Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof. 
  
 SECTION 14.8. Successors and Assigns. All covenants and agreements in this Indenture by the Company shall bind its successors and assigns, whether so
expressed or not. 
  
 SECTION 14.9. Separability Clause. In case
any provision in this Indenture or the 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 14.10. Benefits of Indenture. Nothing contained in this Indenture or
in the Securities, express or implied, shall give to any Person, other than the parties hereto and their successors hereunder, the holders of Senior Debt and the Holders of Securities, any benefit or legal or equitable right, remedy or claim under
this Indenture. 
  
 SECTION 14.11. Governing Law. THIS
INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. 
  
 SECTION 14.12. Counterparts. This instrument may be executed in any number of counterparts, each of which when so executed shall be deemed to be an
original but all such counterparts shall together constitute but one and the same instrument. 
  
 SECTION 14.13. Legal Holidays. In any case where any Interest Payment Date, Redemption Date or Stated Maturity of any Security or the last day on which a Holder of a Security has a right to convert such
Security shall not be a Business Day at any Place of Payment or Place of Conversion, then (notwithstanding any other provision of this Indenture or of the Securities) payment of interest or principal or premium, if any, or conversion of the
Securities, need not be made at such Place of Payment or Place of Conversion on such day, but may be made on the next succeeding Business Day at such Place of Payment or Place of Conversion with the same force and effect as if made on the Interest
Payment Date or Redemption Date or at the Stated Maturity or on such last day for conversion; provided, however, that in the case that payment is made on such succeeding Business Day, no interest shall accrue on the amount so payable
for the period from and after such Interest Payment Date, Redemption Date or Stated Maturity, as the case may be. 
  
 SECTION 14.14. Recourse Against Others. No recourse for the payment of the principal of or premium, if any, or interest on any Security, or for any claim
based thereon or otherwise in respect thereof, shall be had against any incorporator, shareholder, officer or director, as such, past, present or future, of the Company or of any successor corporation, whether by virtue of any constitution, statute
or rule of law or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance thereof and as part of the consideration for the issue thereof, expressly waived and released. 
  
  

 63 

 SIGNATURES 
  

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

			
	CV THERAPEUTICS, INC., as Issuer
	 By:
	  	 
	 Name:
	  	Louis G.
Lange,
M.D.,
Ph.D.
	 Title:
	  	Chairman
and Chief
Executive
Officer
	 WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee

	 By:
	  	 
	 Name:
	  	Timothy
P.
Mowdy
	 Title:
	  	Vice
President

  

 64 

 EXHIBIT A 
  

FORM OF SECURITY 
  
 [FACE OF SECURITY] 
  
 UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (“DTC”) TO CV THERAPEUTICS, INC. (OR ITS
SUCCESSOR) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, CONVERSION OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR OF SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT HEREON 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 SINCE THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.[1] 
  

	1	This legend should be included only if the Security is issued in global form. 

  

 65 

 CV THERAPEUTICS, INC. 
 31⁄4% Senior Subordinated Convertible Note due 2013 
  
 CUSIP NO. 126667AG9 
  
 $             
  
 No.              
  
 CV THERAPEUTICS, INC., a Delaware corporation (the “Company”, which term includes any successor corporation under the Indenture hereinafter
referred to), for value received, hereby promises to pay to , or its registered assigns, the principal sum of U.S. Dollars ($ ) on August 16, 2013. 
  
 Interest Payment Dates: February 16 and August 16, commencing February 16, 2006. 
  
 Regular Record Dates: February 1 and August 1. 
  
 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. 
  

 66 

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

					
	Dated: July 1, 2005	  	CV THERAPEUTICS,
INC.

	 	  	By:	  	 
	 	  	Name:	  	Louis G.
Lange,
M.D.,
Ph.D.
	 	  	Title:	  	Chairman
and Chief
Executive
Officer
	 	  	By:	  	 
	 	  	Name:	  	Dan
Spiegelman
	 	  	Title:	  	Chief
Financial
Officer and
Senior
Vice
President

 Trustee’s Certificate of Authentication 
  
 This is one of the 31⁄4% Senior Subordinated Convertible Notes due 2013
described in the within-named Indenture. 
  

			
	WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee
	 By:
	  	 
	 Name:
	  	Timothy
P.
Mowdy
	 Title:
	  	Vice
President

  
 Dated: July 1, 2005

  
  

 67 

 [REVERSE OF SECURITY] 
  
 CV THERAPEUTICS, INC. 
  
 31⁄4% Senior Subordinated Convertible Note due 2013 
  
 Capitalized terms used herein but not defined shall have the meanings assigned to them in the Indenture referred to below unless otherwise indicated.

  
 1. Principal and Interest. CV Therapeutics, Inc., a
Delaware corporation (the “Company”), promises to pay interest on the principal amount of this Security at the Interest Rate from the date of issuance until repayment at Maturity, redemption or repurchase. The Company shall pay interest on
this Security semiannually in arrears on February 16 and August 16 of each year (each an “Interest Payment Date”), commencing February 16, 2006. 
  
 Interest on this Security shall be computed on the basis of a 360-day year of twelve 30-day months and for any period shorter than a full semiannual
period for which interest is calculated, on the basis of a 30-day month and, for such periods of less than a month, the actual number of days elapsed over a 30-day month. 
  
 A Holder of any Security at the close of business on a Regular Record Date shall be entitled to receive interest on such
Security on the corresponding Interest Payment Date. A Holder of any Security which is converted after the close of business on a Regular Record Date and prior to the corresponding Interest Payment Date (other than any Security whose Maturity is
prior to such Interest Payment Date) shall be entitled to receive interest on the principal amount of such Security, notwithstanding the conversion of such Security prior to such Interest Payment Date. However, any such Holder which surrenders any
such Security for conversion during the period between the close of business on such Regular Record Date and ending with the opening of business on the corresponding Interest Payment Date shall be required to pay the Company an amount equal to the
interest on the principal amount of such Security so converted (but excluding any overdue interest on the principal amount of such Security so converted that exists at the time such Holder surrenders such Security for conversion), which is payable
by the Company to such Holder on such Interest Payment Date, at the time such Holder surrenders such Security for conversion. Notwithstanding the foregoing, any such Holder which surrenders for conversion any Security (a) which has been called for
redemption by the Company in a notice of redemption given by the Company pursuant to Section 10.4 of the Indenture on a Redemption Date after such Regular Record Date and on or prior to the next succeeding Interest Payment Date or (b) with respect
to which the Company has specified a Repurchase Date that is after such Regular Record Date and on or prior to the next succeeding Interest Payment Date, in either case, shall be entitled to receive (and retain) such interest and need not pay the
Company an amount equal to the interest on the principal amount of such Security so converted at the time such Holder surrenders such Security for conversion. 
  

2. Method of Payment. Interest on any Security which is payable, and is punctually paid or duly provided for, on any Interest Payment Date shall
be paid to the person in whose name that Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest. 
  
 Principal of, and premium, if any, and interest on, Global Securities shall be payable to the Depositary in immediately
available funds. 
  
 Principal of and premium, if any, on Physical
Securities shall be payable at the office or agency of the Company maintained for such purpose, initially the Corporate Trust Office of the Trustee. Interest on Physical Securities shall be payable by (i) U.S. Dollar check drawn on a bank located in
the city where the 

  

 68 

 
Corporate Trust Office of the Trustee is located mailed to the address of the Person entitled thereto as such address shall appear in the Register, or (ii)
upon application to the Registrar not later than the relevant Record Date by a Holder of an aggregate principal amount of Securities in excess of $5,000,000, wire transfer in immediately available funds. 
  
 3. Paying Agent and Registrar. Initially, Wells Fargo Bank, National
Association, the Trustee under the Indenture, will act as Paying Agent and Registrar. The Company may change the Paying Agent or Registrar without notice to any Holder. 
  
 4. Indenture. The Company issued this Security under an Indenture, dated as of July 1, 2005 (the
“Indenture”), between the Company and Wells Fargo Bank, National Association, as trustee (the “Trustee”). The terms of this Security include those stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939, as amended (“TIA”). This Security is subject to all such terms, and Holders are referred to the Indenture and the TIA for a statement of all such terms. To the extent permitted by applicable law, in the event
of any inconsistency between the terms of this Security and the terms of the Indenture, the terms of the Indenture shall control. 
  
 5. Optional Redemption. This Security is not redeemable prior to August 20, 2010. This Security may be redeemed in whole or in part, upon not less
than 20 nor more than 60 days’ notice, at any time on or after August 20, 2010, at the option of the Company, at the redemption prices (expressed as a percentage of the principal amount) set forth below if redeemed during the periods described
below, plus any interest accrued but not paid prior to, but excluding, the Redemption Date. 
  

				
	Period	  	Redemption
Price

	 
	 Beginning August 20, 2010 and ending on August 19, 2011
	  	101.219	%
	 Beginning August 20, 2011 and ending on August 19, 2012
	  	100.813	%
	 Beginning on August 20, 2012 and thereafter
	  	100.406	%

  
 If fewer than all the
Securities are to be redeemed, the Trustee shall select the particular Securities to be redeemed from the Outstanding Securities by the methods as provided in the Indenture. 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 to be the portion selected for redemption (provided, however, that the Holder of such
Security so converted and deemed redeemed shall not be entitled to any additional interest payment as a result of such deemed redemption than such Holder would have otherwise been entitled to receive upon conversion of such Security). Securities
which 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. 
  
 On and after the Redemption Date, interest shall cease to accrue on Securities or portions of Securities called for redemption, unless the Company
defaults in the payment of the Optional Redemption Price and accrued and unpaid interest. 
  
 Notice of redemption shall be given by the Company to the Holders as provided in the Indenture. 
  
 6. Repurchase Rights. 
  
 (a) Repurchase Right Upon a Fundamental Change. If a Fundamental Change occurs, the Holder of Securities, at the Holder’s option, shall have
the right, in accordance with the provisions of the Indenture, to require the Company to repurchase the Securities (or any portion of the principal amount hereof that is at least $1,000 or an integral multiple thereof; provided,
however, that the portion of the principal amount of this Security to be Outstanding after such repurchase is at least equal to $1,000) at a purchase price equal to 100% of the principal amount of the Securities to be repurchased (the
“Repurchase Price”), plus interest accrued and unpaid to, but excluding, the Repurchase Date. 
  

 69 

 A Company Notice shall be given by the Company to the Holders as provided in the Indenture. To exercise a
Repurchase Right, a Holder must deliver to the Trustee a written notice as provided in the Indenture. 
  
 (b) Payment of Repurchase Price. Subject to the fulfillment by the Company of the conditions set forth in the Indenture, the Company may elect to
pay the Repurchase Price by delivering the number of shares of Common Stock equal to (i) the Repurchase Price divided by (ii) 95% of the average of the daily volume-weighted average price of the Common Stock for the twenty consecutive Trading Days
immediately preceding and including the third Business Day prior to the Repurchase Date (if the third Business Day prior to the applicable Repurchase Date is a Trading Day, or if not, then on the last Trading Day prior to the third Business Day),
appropriately adjusted to take into account the occurrence, during the period commencing on the first Trading Day during the twenty Trading-Day period and ending on the Repurchase Date of any event that would result in an adjustment to the
conversion rate set forth in the Indenture. No fractional shares of Common Stock will be issued upon repurchase of any Securities. Instead of any fractional share of Common Stock which would otherwise be issued upon conversion of such Securities,
the Company shall pay a cash adjustment as provided in the Indenture. 
  
 7. Conversion Rights. (a) Subject to and upon compliance with the provisions of the Indenture, the Holder of Securities shall be entitled, at such Holder’s option, at any time before the close of business on August 20, 2013, to
convert the Holder’s Securities (or any portion of the principal amount hereof which is $1,000 or an integral multiple thereof), at the principal amount thereof or of such portion thereof, into duly authorized, fully paid and nonassessable
shares of Common Stock of the Company at the Conversion Rate in effect at the time of conversion. 
  
 (b) In the case of a Security (or a portion thereof) called for redemption, such conversion right in respect of the Security (or such portion thereof) so
called shall expire at the close of business on the Business Day immediately preceding the Redemption Date, unless the Company defaults in making the payment due upon redemption. In the case of a Fundamental Change for which the Holder exercises its
Repurchase Right with respect to a Security (or a portion thereof), such conversion right in respect of the Security (or portion thereof) shall expire at the close of business on the Business Day preceding the Repurchase Date. 
  
 Subject to certain conditions provided for in the Indenture, in certain
circumstances, a Holder may receive an amount in cash or Common Stock, at the option of the Company, equal to the Make-Whole Premium, in addition to the shares of Common Stock issuable on conversion of such Security. 
  
 (c) The Conversion Rate shall be initially equal to 37.0370 shares of Common
Stock per $1,000 principal amount of Securities. The Conversion Rate shall be adjusted under certain circumstances as provided in the Indenture. 
  
 (d) No fractional shares of Common Stock shall be issued upon conversion of any Securities. Instead of any fractional share of Common Stock which would
otherwise be issued upon conversion of such Securities, the Company shall pay a cash adjustment as provided in the Indenture. 
  
 (e) If a Fundamental Change Effective Date occurs prior to August 20, 2010, other than in connection with a Fundamental Change described in clause (3) of
the definition of “Change of Control,” and a Holder converts Securities in connection with such Fundamental Change, that Holder shall receive the Make-Whole Premium payable pursuant to Section 12.13 of the Indenture consisting of an
increase in the Conversion Rate. 
  

 70 

 8. Subordination. The Indebtedness evidenced by this Security is, to the extent and in the manner
provided in the Indenture, subordinated and subject in right of payment to the prior payment in full of all amounts then due on all Senior Debt of the Company; provided, however, that the Securities, the Indebtedness represented
thereby and the payment of the principal of and premium, if any, and interest on the Securities in all respects shall rank equally with, or prior to, all existing and future Indebtedness of the Company that is expressly subordinated to any Senior
Debt, and this Security is issued subject to such provisions of the Indenture with respect thereto. Each Holder of this Security, by accepting the same, (a) agrees to and shall be bound by such provisions, (b) authorizes and directs the Trustee on
such Holder’s behalf to take such action as may be necessary or appropriate to effectuate the subordination so provided and (c) appoints the Trustee such Holder’s attorney-in-fact for any and all such purposes. 
  
 9. Denominations; Transfer; Exchange. The Securities are issuable in
registered form, without coupons, in denominations of $1,000 and integral multiples of $1,000 in excess thereof. A Holder may register the transfer or exchange of Securities in accordance with the Indenture. The Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents and the Company may require a Holder to pay any taxes and fees required by law or permitted by the Indenture. 
  
 In the event of a redemption in part, the Company shall not 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 such Securities, or portion thereof,
called for redemption. 
  
 In the event of redemption, conversion
or repurchase of the Securities in part only, a new Security or Securities for the unredeemed, unconverted or unrepurchased portion thereof shall be issued in the name of the Holder hereof. 
  
 10. Persons Deemed Owners. The registered Holder of this Security
shall be treated as its owner for all purposes. 
  
 11.
Unclaimed Money. The Trustee and the Paying Agent shall pay to the Company any money held by them for the payment of principal, premium, if any, or interest that remains unclaimed for two years after the date upon which such payment shall
have become due. After payment to the Company, Holders entitled to the money must look to the Company for payment as general creditors unless an applicable abandoned property law designates another Person, and all liability of the Trustee and the
Paying Agent with respect to such money shall cease. 
  
 12.
Discharge Prior to Redemption or Maturity. Subject to certain conditions contained in the Indenture, the Company may discharge its obligations under the Securities and the Indenture if (1) (a) all of the Outstanding Securities shall become
due and payable at their scheduled Maturity within one year or (b) all of the Outstanding Securities are scheduled for redemption within one year, and (2) the Company shall have deposited with the Trustee money and/or U.S. Government Obligations
sufficient to pay the principal of, and premium, if any, and interest on, all of the Outstanding Securities on the date of Maturity or redemption, as the case may be. 
  
 13. Amendment; Supplement; Waiver. The Indenture permits, with certain exceptions as therein provided, the amendment
thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Securities under the Indenture at any time by the Company and the Trustee with the consent of the Holders of a majority in aggregate
principal amount of the Outstanding Securities (or such 

  

 71 

 
lesser amount as shall have acted at a meeting pursuant to the provisions of the Indenture). 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 upon registration of transfer hereof
or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Security or such other Security. 
  
 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 premium, if any, and interest on this Security at the times, places and rate, and in the coin or currency, herein prescribed or to convert this Security (or pay cash in lieu of conversion) as
provided in the Indenture. 
  
 14. Defaults and Remedies.
The Indenture provides that an Event of Default with respect to the Securities occurs when any of the following occurs: 
  
 (a) the Company defaults in the payment of the principal of or premium, if any, on any of the Securities when it becomes due and payable, at Maturity,
upon redemption or exercise of a Repurchase Right or otherwise, whether or not such payment is prohibited by the subordination provisions of Article 13 of the Indenture; or 
  
 (b) the Company defaults in the payment of interest on any of the Securities when it becomes due and payable and such
default continues for a period of 30 days, whether or not such payment is prohibited by the subordination provisions of Article 13 of the Indenture; provided, however, that the Company’s failure to pay interest on any of the
Securities within five Business Days of any Interest Payment Date prior to and including August 16, 2008 shall constitute an immediate Event of Default; or 
  
 (c) the Company fails to deliver shares of Common Stock, together with cash instead of fractional shares, when those shares of Common Stock or cash
instead of fractional shares is required to be delivered following conversion of a Security in accordance with the provisions of Article 12 of the Indenture; or 
  

(d) the Company fails to perform or observe any other term, covenant or agreement contained in the Securities or the Indenture and such default
continues for a period of 60 days after written notice of such failure is given as specified in the Indenture; or 
  
 (e) (i) the Company fails to make any payment by the end of the applicable grace period, if any, after the maturity of any Indebtedness for borrowed money
in an amount in excess of $5,000,000, or (ii) there is an acceleration of any Indebtedness for borrowed money in an amount in excess of $5,000,000 because of a default with respect to such Indebtedness without such Indebtedness having been
discharged or such acceleration having been cured, waived, rescinded or annulled, in the case of either clause (i) or (ii) above, for a period of 30 days after written notice is given to the Company as specified in the Indenture; or 
  
 (f) the failure to provide the Company Notice in accordance with the terms of
Section 11.3(a) of the Indenture; or 
  
 (g) there are certain
events of bankruptcy, insolvency or reorganization of the Company; or 
  

 72 

 (h) the Pledge and Escrow Agreement ceases to be in full force and effect or enforceable prior to its
expiration in accordance with its terms. 
  
 If an Event of
Default shall occur and be continuing, the principal of all the Securities may be declared due and payable in the manner and with the effect provided in the Indenture. 
  
 15. Authentication. This Security shall not be valid until the Trustee (or authenticating agent) executes the
certificate of authentication on the other side of this Security. 
  
 16. Abbreviations. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not
as tenants in common), CUST (= Custodian) and U/G/M/A (= Uniform Gifts to Minors Act). 
  
 17. Additional Rights of Holders of Transfer Restricted Securities. In addition to the rights provided to Holders under the Indenture, Holders of Transfer Restricted Securities shall have all the rights set
forth in the Registration Rights Agreement. 
  
 18. CUSIP
Numbers. Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP numbers to be printed on this Security and the Trustee may use CUSIP numbers in notices of redemption
as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on this Security or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed
thereon. 
  
 19. Governing Law. The Indenture and this
Security shall be governed by, and construed in accordance with, the law of the State of New York. 
  
 20. Successor Corporation. In the event a successor corporation assumes all the obligations of the Company under this Security, pursuant to the
terms hereof and of the Indenture, the Company shall be released from all such obligations. 
  
  

 73 

 ASSIGNMENT FORM 
  
 To assign this Security, fill in the form below and have your signature guaranteed: (I) or (we) assign and transfer this
Security to: 
  
 (Insert assignee’s soc. sec. or tax I.D.
no.) 
  
 (Print or type assignee’s name, address and zip
code) 
  
 and irrevocably appoint to transfer this Security
on the books of the Company. The agent may substitute another to act for him. 
  

						
	Dated:	  	
	  	
	 
	 	  	Your
Name:	  	 	 
	 	  	 	  	(Print
your
name
exactly
as it
appears
on the
face of
this
Security	 
 
 
 
 
 
 
 
 
)
	 	  	Your
Signature:	  	 	 
	 	  	 	  	(Sign
exactly
as your
name
appears
on the
face of
this
Security	 
 
 
 
 
 
 
 
)

  

	
	Signature Guarantee*:
	 By:

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

 74 

 CONVERSION NOTICE 
  
 TO: CV THERAPEUTICS, INC. 
 3172 Porter Drive 
 Palo Alto, California 94304 
 Attention: General Counsel 
  
 The
undersigned registered owner of this Security hereby irrevocably exercises the option to convert this Security, or the portion hereof (which is $1,000 principal amount or an integral multiple thereof) below designated, into shares of Common Stock in
accordance with the terms of the Indenture referred to in this Security, and directs that the shares issuable and deliverable upon such conversion, together with any check in payment for fractional shares and any Securities representing any
unconverted principal amount hereof, be issued and delivered to the registered holder hereof unless a different name has been indicated below. If shares or any portion of this Security not converted is to be issued in the name of a person other than
the undersigned, the undersigned will pay all transfer taxes payable with respect thereto. Any amount required to be paid to the undersigned on account of interest accompanies this Security. 
  

							
	Dated:	  	Your Name:

	 	 	
	 
	 	  	 	 	 	(Print
your
name
exactly
as it
appears
on the
face of
this
Security	 
 
 
 
 
 
 
 
 
)
	 	  	Your
Signature:	 
 	 	 	 
	 	  	 	 	 	(Sign
exactly
as your
name
appears
on the
face of
this
Security	 
 
 
 
 
 
 
 
)
	 	  	Signature
Guarantee	 
*:	 	 	 
	 	  	Social Security or other
Taxpayer	 
 
	 	  	Identification
Number:	 
 	 	 	 

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

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

  
 Fill in for registration of shares (if to be issued) and Securities (if to be
delivered) other than to and in the name of the registered holder: 
  
 (Name) 
  
 (Street Address) 
  
 (City, State and Zip Code) 
  
  

 75 

 NOTICE OF EXERCISE OF REPURCHASE RIGHT 
  
 TO: CV THERAPEUTICS, INC. 
 3172 Porter Drive 
 Palo Alto, California
94304 
 Attention: General Counsel 
  
 The undersigned registered owner of this Security hereby irrevocably acknowledges receipt of a notice from CV Therapeutics, Inc. (the “Company”)
as to the occurrence of a Fundamental Change with respect to the Company and requests and instructs the Company to repay the entire principal amount of this Security, or the portion thereof (which is $1,000 principal amount or an integral multiple
thereof) below designated, in accordance with the terms of the Indenture referred to in this Security, together with interest accrued and unpaid to, but excluding, such date, to the registered holder hereof, in cash. 
  

							
	Dated:	  	Your Name:

	 	 	
	 
	 	  	 	 	 	(Print
your
name
exactly
as it
appears
on the
face of
this
Security	 
 
 
 
 
 
 
 
 
)
	 	  	Your
Signature:	 
 	 	 	 
	 	  	 	 	 	(Sign
exactly
as your
name
appears
on the
face of
this
Security	 
 
 
 
 
 
 
 
)
	 	  	Signature
Guarantee	 
*:	 	 	 
	 	  	Social Security or other
Taxpayer	 
 
	 	  	Identification
Number:	 
 	 	 	 

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

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

  
  

 76 

 SCHEDULE OF EXCHANGES FOR PHYSICAL SECURITIES2 
  
 The following exchanges of a part of this Global Security for Physical Securities have been made: 
  

									
	Date of Exchange	 	Amount of decrease in Principal Amount of this Global Security	 	Amount of increase in Principal Amount of this Global Security	  	Principal Amount of
this Global Security
following such
decrease (or
increase)	  	Signature of
authorized officer of
Trustee

 2 This schedule should be included only if the Security is issued in global form. 
  

 77

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