Document:

Exhibit 4.1

 

STEEL DYNAMICS, INC.

 

as Issuer

 

and

 

SDI INVESTMENT COMPANY

STEEL DYNAMICS SALES NORTH AMERICA, INC.

NEW MILLENNIUM BUILDING SYSTEMS, LLC

ROANOKE ELECTRIC STEEL CORPORATION

NEW MILLENNIUM BUILDING SYSTEMS, INC.

SOCAR OF OHIO, INC.

SHREDDED PRODUCTS II, LLC

JOHN W. HANCOCK, JR., LLC

STEEL OF WEST VIRGINIA, INC.

STEEL VENTURES, INC.

SWVA, INC.

MARSHALL STEEL, INC.

THE TECHS INDUSTRIES, INC.

OMNISOURCE CORPORATION

ADMETCO, INC.

ATLANTIC SCRAP AND PROCESSING — WILMINGTON, LLC

AUBURN INVESTMENT COMPANY, LLC

CAPITOL CITY METALS, LLC

CAROLINAS RECYCLING GROUP, LLC

COHEN & GREEN SALVAGE CO., INC.

GLOBAL SHREDDING TECHNOLOGIES, LTD., LLC

INDUSTRIAL SCRAP CORPORATION

INDUSTRIAL SCRAP, LLC

JACKSON IRON & METAL COMPANY, INC.

LUCKY STRIKE METALS, LLC

LUMBERTON RECYCLING COMPANY, INC.

MICHIGAN PROPERTIES ECORSE, LLC

OMNISOURCE ATHENS DIVISION, LLC

OMNISOURCE BAY CITY, LLC

OMNISOURCE INDIANAPOLIS, LLC

OMNISOURCE, LLC

OMNISOURCE MEXICO, LLC

OMNISOURCE SOUTHEAST, LLC

OMNISOURCE TRANSPORT, LLC

RAEFORD SALVAGE COMPANY, INC.

RECOVERY TECHNOLOGIES, LLC

SCIENTIFIC RECYCLING GROUP, LLC

SUPERIOR ALUMINUM ALLOYS, LLC

 

as

 

Initial Subsidiary Guarantors

 

and

 

Wells Fargo Bank, National Association

 

as Trustee

 

 

INDENTURE

 

Dated as of June 9, 2009

 

 

5.125% Convertible Senior Notes due 2014

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  
	
  ARTICLE 1

  
	
   

  
	
  DEFINITIONS AND INCORPORATION BY REFERENCE

  
	
   

  	
   

  	
   

  
	
  Section 1.01.

  	
  Definitions

  	
  1

  
	
   

  	
   

  	
   

  
	
  Section 1.02.

  	
  Other Definitions

  	
  9

  
	
   

  	
   

  	
   

  
	
  Section 1.03.

  	
  Trust Indenture Act Provisions

  	
  9

  
	
   

  	
   

  	
   

  
	
  Section 1.04.

  	
  Rules of Construction

  	
  10

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2

  
	
   

  
	
  THE SECURITIES

  
	
   

  	
   

  	
   

  
	
  Section 2.01.

  	
  Form and Dating

  	
  10

  
	
   

  	
   

  	
   

  
	
  Section 2.02.

  	
  Execution and Authentication

  	
  12

  
	
   

  	
   

  	
   

  
	
  Section 2.03.

  	
  Registrar, Paying Agent and
  Conversion Agent

  	
  13

  
	
   

  	
   

  	
   

  
	
  Section 2.04.

  	
  Paying Agent To Hold Money in Trust

  	
  14

  
	
   

  	
   

  	
   

  
	
  Section 2.05.

  	
  Conversion Agent To Hold Money in
  Trust

  	
  14

  
	
   

  	
   

  	
   

  
	
  Section 2.06.

  	
  Lists of Holders of Securities

  	
  15

  
	
   

  	
   

  	
   

  
	
  Section 2.07.

  	
  Transfer and Exchange

  	
  15

  
	
   

  	
   

  	
   

  
	
  Section 2.08.

  	
  Replacement Securities

  	
  16

  
	
   

  	
   

  	
   

  
	
  Section 2.09.

  	
  Outstanding Securities

  	
  17

  
	
   

  	
   

  	
   

  
	
  Section 2.10.

  	
  Treasury Securities

  	
  17

  
	
   

  	
   

  	
   

  
	
  Section 2.11.

  	
  Temporary Securities

  	
  17

  
	
   

  	
   

  	
   

  
	
  Section 2.12.

  	
  Cancellation

  	
  18

  
	
   

  	
   

  	
   

  
	
  Section 2.13.

  	
  Legend; Additional Transfer and
  Exchange Requirements

  	
  18

  
	
   

  	
   

  	
   

  
	
  Section 2.14.

  	
  CUSIP Numbers

  	
  20

  
	
   

  	
   

  	
   

  
	
  Section 2.15.

  	
  Calculations

  	
  20

  
	
   

  	
   

  	
   

  
	
  Section 2.16.

  	
  Payment of Interest; Interest
  Rights Preserved

  	
  21

  
	
   

  	
   

  	
   

  
	
  Section 2.17.

  	
  Computation of Interest

  	
  22

  
	
   

  	
   

  
	
  ARTICLE 3

  
	
   

  
	
  REDEMPTION AND REPURCHASE

  
	
   

  	
   

  	
   

  
	
  Section 3.01.

  	
  Company’s Right to Redeem; Notice
  to Trustee

  	
  22

  
				

 

i

 

	
  Section 3.02.

  	
  Selection of Securities to be
  Redeemed

  	
  22

  
	
   

  	
   

  	
   

  
	
  Section 3.03.

  	
  Notice of Redemption

  	
  23

  
	
   

  	
   

  	
   

  
	
  Section 3.04.

  	
  Effect of Notice of Redemption

  	
  24

  
	
   

  	
   

  	
   

  
	
  Section 3.05.

  	
  Deposit of Redemption Price

  	
  24

  
	
   

  	
   

  	
   

  
	
  Section 3.06.

  	
  Securities Redeemed in Part

  	
  24

  
	
   

  	
   

  	
   

  
	
  Section 3.07.

  	
  [Intentionally Omitted]

  	
  24

  
	
   

  	
   

  	
   

  
	
  Section 3.08.

  	
  Repurchase of Securities at Option
  of the Holder upon a Fundamental Change

  	
  25

  
	
   

  	
   

  	
   

  
	
  Section 3.09.

  	
  Effect of Fundamental Change
  Purchase Notice

  	
  28

  
	
   

  	
   

  	
   

  
	
  Section 3.10.

  	
  Deposit of Fundamental Change
  Purchase Price

  	
  28

  
	
   

  	
   

  	
   

  
	
  Section 3.11.

  	
  Securities Purchased in Part

  	
  29

  
	
   

  	
   

  	
   

  
	
  Section 3.12.

  	
  Repayment to the Company

  	
  29

  
	
   

  	
   

  	
   

  
	
  Section 3.13.

  	
  Compliance With Securities Laws
  Upon Purchase of Securities

  	
  29

  
	
   

  	
   

  	
   

  
	
  Section 3.14.

  	
  Purchase of Securities In Open
  Market

  	
  30

  
	
   

  
	
  ARTICLE 4

  
	
   

  
	
  CONVERSION

  
	
   

  
	
  Section 4.01.

  	
  Right to Convert

  	
  30

  
	
   

  	
   

  	
   

  
	
  Section 4.02.

  	
  Conversion Procedures

  	
  30

  
	
   

  	
   

  	
   

  
	
  Section 4.03.

  	
  Payments Upon Conversion

  	
  32

  
	
   

  	
   

  	
   

  
	
  Section 4.04.

  	
  Adjustment of Conversion Rate

  	
  33

  
	
   

  	
   

  	
   

  
	
  Section 4.05.

  	
  Certain Other Adjustments

  	
  41

  
	
   

  	
   

  	
   

  
	
  Section 4.06.

  	
  Adjustments Upon Certain
  Fundamental Changes

  	
  41

  
	
   

  	
   

  	
   

  
	
  Section 4.07.

  	
  Effect of Recapitalization,
  Reclassification, Consolidation, Merger or Sale

  	
  43

  
	
   

  	
   

  	
   

  
	
  Section 4.08.

  	
  Taxes on Shares Issued

  	
  44

  
	
   

  	
   

  	
   

  
	
  Section 4.09.

  	
  Reservation of Shares; Shares to be
  Fully Paid; Compliance With Governmental Requirements; Listing of Common
  Stock

  	
  44

  
	
   

  	
   

  	
   

  
	
  Section 4.10.

  	
  Responsibility of Trustee

  	
  44

  
	
   

  	
   

  	
   

  
	
  Section 4.11.

  	
  Notice to Holders Prior to Certain
  Actions

  	
  45

  
	
   

  	
   

  	
   

  
	
  Section 4.12.

  	
  Stockholder Rights Plan

  	
  45

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5

  
	
   

  
	
  COVENANTS

  
	
   

  	
   

  	
   

  
	
  Section 5.01.

  	
  Payment of Securities

  	
  46

  

 

ii

 

	
  Section 5.02.

  	
  Reports by Company

  	
  47

  
	
   

  	
   

  	
   

  
	
  Section 5.03.

  	
  Compliance Certificates

  	
  47

  
	
   

  	
   

  	
   

  
	
  Section 5.04.

  	
  Further Instruments and Acts

  	
  48

  
	
   

  	
   

  	
   

  
	
  Section 5.05.

  	
  Maintenance of Corporate Existence

  	
  48

  
	
   

  	
   

  	
   

  
	
  Section 5.06.

  	
  Issuances of Subsidiary Guarantees

  	
  48

  
	
   

  	
   

  	
   

  
	
  Section 5.07.

  	
  Stay, Extension And Usury Laws

  	
  48

  
	
   

  	
   

  	
   

  
	
  Section 5.08.

  	
  Payment of Special Interest

  	
  48

  
	
   

  	
   

  	
   

  
	
  Section 5.09.

  	
  Maintenance of Office or Agency

  	
  48

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6

  
	
   

  
	
  CONSOLIDATION; MERGER; SALE OF ASSETS

  
	
   

  	
   

  	
   

  
	
  Section 6.01.

  	
  Company or Subsidiary Guarantors
  May Consolidate, Etc., Only on Certain Terms

  	
  49

  
	
   

  	
   

  	
   

  
	
  Section 6.02.

  	
  Successor Substituted

  	
  50

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7

  
	
   

  
	
  DEFAULT AND REMEDIES

  
	
   

  
	
  Section 7.01.

  	
  Events of Default

  	
  50

  
	
   

  	
   

  	
   

  
	
  Section 7.02.

  	
  Acceleration; Special Interest

  	
  53

  
	
   

  	
   

  	
   

  
	
  Section 7.03.

  	
  Collection of Indebtedness and
  Suits for Enforcement by Trustee

  	
  55

  
	
   

  	
   

  	
   

  
	
  Section 7.04.

  	
  Trustee May File Proofs of Claim

  	
  55

  
	
   

  	
   

  	
   

  
	
  Section 7.05.

  	
  Trustee May Enforce Claims
  Without Possession of Securities

  	
  56

  
	
   

  	
   

  	
   

  
	
  Section 7.06.

  	
  Application of Money Collected

  	
  56

  
	
   

  	
   

  	
   

  
	
  Section 7.07.

  	
  Limitation on Suits

  	
  57

  
	
   

  	
   

  	
   

  
	
  Section 7.08.

  	
  Unconditional Right of Holders to
  Receive Payment and to Convert

  	
  57

  
	
   

  	
   

  	
   

  
	
  Section 7.09.

  	
  Restoration of Rights and Remedies

  	
  58

  
	
   

  	
   

  	
   

  
	
  Section 7.10.

  	
  Rights and Remedies Cumulative

  	
  58

  
	
   

  	
   

  	
   

  
	
  Section 7.11.

  	
  Delay or Omission Not Waiver

  	
  58

  
	
   

  	
   

  	
   

  
	
  Section 7.12.

  	
  Control by Holders

  	
  58

  
	
   

  	
   

  	
   

  
	
  Section 7.13.

  	
  Waiver of Past Defaults

  	
  58

  
	
   

  	
   

  	
   

  
	
  Section 7.14.

  	
  Undertaking for Costs

  	
  59

  
	
   

  	
   

  	
   

  
	
  Section 7.15.

  	
  Remedies Subject to Applicable Law

  	
  59

  

 

iii

 

	
  ARTICLE 8

  
	
   

  
	
  TRUSTEE

  
	
   

  
	
  Section 8.01.

  	
  Duties of Trustee

  	
  59

  
	
   

  	
   

  	
   

  
	
  Section 8.02.

  	
  Notice of Default

  	
  60

  
	
   

  	
   

  	
   

  
	
  Section 8.03.

  	
  Certain Rights of Trustee

  	
  61

  
	
   

  	
   

  	
   

  
	
  Section 8.04.

  	
  Trustee Not Responsible for
  Recitals, Dispositions of Securities or Application of Proceeds Thereof

  	
  62

  
	
   

  	
   

  	
   

  
	
  Section 8.05.

  	
  Trustee and Agents May Hold
  Securities; Collections; etc.

  	
  63

  
	
   

  	
   

  	
   

  
	
  Section 8.06.

  	
  Money Held in Trust

  	
  63

  
	
   

  	
   

  	
   

  
	
  Section 8.07.

  	
  Compensation and Indemnification of
  Trustee and Its Prior Claim

  	
  63

  
	
   

  	
   

  	
   

  
	
  Section 8.08.

  	
  Conflicting Interests

  	
  64

  
	
   

  	
   

  	
   

  
	
  Section 8.09.

  	
  Trustee Eligibility

  	
  64

  
	
   

  	
   

  	
   

  
	
  Section 8.10.

  	
  Resignation and Removal;
  Appointment of Successor Trustee

  	
  64

  
	
   

  	
   

  	
   

  
	
  Section 8.11.

  	
  Acceptance of Appointment by
  Successor

  	
  66

  
	
   

  	
   

  	
   

  
	
  Section 8.12.

  	
  Merger, Conversion, Consolidation
  or Succession to Business

  	
  66

  
	
   

  	
   

  	
   

  
	
  Section 8.13.

  	
  Preferential Collection of Claims
  Against Company

  	
  67

  
	
   

  	
   

  	
   

  
	
  Section 8.14.

  	
  Reports By Trustee

  	
  67

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9

  
	
   

  
	
  SATISFACTION AND DISCHARGE OF INDENTURE

  
	
   

  	
   

  	
   

  
	
  Section 9.01.

  	
  Satisfaction and Discharge of
  Indenture

  	
  67

  
	
   

  	
   

  	
   

  
	
  Section 9.02.

  	
  Application of Trust Money

  	
  68

  
	
   

  	
   

  	
   

  
	
  Section 9.03.

  	
  Reinstatement

  	
  68

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10

  
	
   

  
	
  AMENDMENTS; SUPPLEMENTS AND WAIVERS

  
	
   

  	
   

  	
   

  
	
  Section 10.01.

  	
  Without Consent of Holders

  	
  69

  
	
   

  	
   

  	
   

  
	
  Section 10.02.

  	
  With Consent of Holders

  	
  70

  
	
   

  	
   

  	
   

  
	
  Section 10.03.

  	
  Execution of Supplemental
  Indentures and Agreements

  	
  71

  
	
   

  	
   

  	
   

  
	
  Section 10.04.

  	
  Effect of Supplemental Indentures

  	
  71

  
	
   

  	
   

  	
   

  
	
  Section 10.05.

  	
  Conformity with Trust Indenture Act

  	
  71

  
	
   

  	
   

  	
   

  
	
  Section 10.06.

  	
  Reference in Securities to
  Supplemental Indentures

  	
  72

  
	
   

  	
   

  	
   

  
	
  Section 10.07.

  	
  Notice of Supplemental Indentures

  	
  72

  

 

iv

 

	
  ARTICLE 11

  
	
   

  
	
  GUARANTEE OF SECURITIES

  
	
   

  	
   

  	
   

  
	
  Section 11.01.

  	
  Note Guarantee

  	
  72

  
	
   

  	
   

  	
   

  
	
  Section 11.02.

  	
  Obligations Unconditional

  	
  74

  
	
   

  	
   

  	
   

  
	
  Section 11.03.

  	
  Release of Note Guarantees

  	
  75

  
	
   

  	
   

  	
   

  
	
  Section 11.04.

  	
  Notice to Trustee

  	
  75

  
	
   

  	
   

  	
   

  
	
  Section 11.05.

  	
  This Article Not to Prevent
  Events of Default

  	
  75

  
	
   

  	
   

  	
   

  
	
  ARTICLE 12

  
	
   

  
	
  MISCELLANEOUS

  
	
   

  	
   

  	
   

  
	
  Section 12.01.

  	
  Conflict with Trust Indenture Act

  	
  76

  
	
   

  	
   

  	
   

  
	
  Section 12.02.

  	
  Notices

  	
  76

  
	
   

  	
   

  	
   

  
	
  Section 12.03.

  	
  Disclosure of Names and Addresses
  of Holders

  	
  77

  
	
   

  	
   

  	
   

  
	
  Section 12.04.

  	
  Compliance Certificates and
  Opinions

  	
  77

  
	
   

  	
   

  	
   

  
	
  Section 12.05.

  	
  Acts of Holders

  	
  78

  
	
   

  	
   

  	
   

  
	
  Section 12.06.

  	
  Benefits of Indenture

  	
  79

  
	
   

  	
   

  	
   

  
	
  Section 12.07.

  	
  Legal Holidays

  	
  79

  
	
   

  	
   

  	
   

  
	
  Section 12.08.

  	
  Governing Law; Waiver of Trial by
  Jury

  	
  80

  
	
   

  	
   

  	
   

  
	
  Section 12.09.

  	
  No Adverse Interpretation of Other
  Agreements

  	
  80

  
	
   

  	
   

  	
   

  
	
  Section 12.10.

  	
  No Personal Liability of Directors,
  Officers, Employees and Stockholders

  	
  80

  
	
   

  	
   

  	
   

  
	
  Section 12.11.

  	
  Successors and Assigns

  	
  80

  
	
   

  	
   

  	
   

  
	
  Section 12.12.

  	
  Multiple Counterparts

  	
  80

  
	
   

  	
   

  	
   

  
	
  Section 12.13.

  	
  Separability Clause

  	
  80

  
	
   

  	
   

  	
   

  
	
  Section 12.14.

  	
  Schedules and Exhibits

  	
  80

  
	
   

  	
   

  	
   

  
	
  Section 12.15.

  	
  Effect of Headings and Table of
  Contents

  	
  81

  

 

	
  EXHIBIT A Form of Security

  	
  A-1

  
	
  ·

  	
  Assignment
  Form

  
	
  ·

  	
  Form of
  Conversion Notice

  
	
  ·

  	
  Form of
  Notice of Redemption

  
	
  ·

  	
  Form of
  Fundamental Change Purchase Notice

  
			

 

v

 

CROSS-REFERENCE TABLE*

 

	
  TIA

  Section

  	
   

  	
  Indenture

  Section(s)

  	
   

  
	
  Section

  	
   

  	
  310(a)(1)

  	
   

  	
  8.09

  	
   

  
	
   

  	
   

  	
  (a)(2)

  	
   

  	
  8.09

  	
   

  
	
   

  	
   

  	
  (a)(3)

  	
   

  	
  N.A. 

  	
  **

  
	
   

  	
   

  	
  (a)(4)

  	
   

  	
  N.A.

  	
   

  
	
   

  	
   

  	
  (a)(5)

  	
   

  	
  8.09

  	
   

  
	
   

  	
   

  	
  (b)

  	
   

  	
  8.08

  	
   

  
	
   

  	
   

  	
  (c)

  	
   

  	
  N.A.

  	
   

  
	
  Section

  	
   

  	
  311(a)

  	
   

  	
  8.13

  	
   

  
	
   

  	
   

  	
  (b)

  	
   

  	
  8.05

  	
   

  
	
   

  	
   

  	
  (c)

  	
   

  	
  N.A.

  	
   

  
	
  Section

  	
   

  	
  312(a)

  	
   

  	
  2.06

  	
   

  
	
   

  	
   

  	
  (b)

  	
   

  	
  12.03

  	
   

  
	
   

  	
   

  	
  (c)

  	
   

  	
  12.03

  	
   

  
	
  Section

  	
   

  	
  313(a)

  	
   

  	
  8.14 (a)

  	
   

  
	
   

  	
   

  	
  (b)(1)

  	
   

  	
  N.A.

  	
   

  
	
   

  	
   

  	
  (b)(2)

  	
   

  	
  8.14 (a)

  	
   

  
	
   

  	
   

  	
  (c)

  	
   

  	
  8.14 (a)

  	
   

  
	
   

  	
   

  	
  (d)

  	
   

  	
  8.14 (b)

  	
   

  
	
  Section

  	
   

  	
  314(a)

  	
   

  	
  5.02

  	
   

  
	
   

  	
   

  	
  (b)

  	
   

  	
  N.A.

  	
   

  
	
   

  	
   

  	
  (c)(1)

  	
   

  	
  12.04

  	
   

  
	
   

  	
   

  	
  (c)(2)

  	
   

  	
  12.04

  	
   

  
	
   

  	
   

  	
  (c)(3)

  	
   

  	
  N.A.

  	
   

  
	
   

  	
   

  	
  (d)

  	
   

  	
  N.A.

  	
   

  
	
   

  	
   

  	
  (e)

  	
   

  	
  12.04

  	
   

  
	
   

  	
   

  	
  (f)

  	
   

  	
  N.A.

  	
   

  
	
  Section

  	
   

  	
  315(a)

  	
   

  	
  8.01 (b)

  	
   

  
	
   

  	
   

  	
  (b)

  	
   

  	
  8.02

  	
   

  
	
   

  	
   

  	
  (c)

  	
   

  	
  8.01 (a)

  	
   

  
	
   

  	
   

  	
  (d)

  	
   

  	
  8.01 (c)

  	
   

  
	
   

  	
   

  	
  (d)(2)

  	
   

  	
  8.01 (c)

  	
   

  
	
   

  	
   

  	
  (d)(3)

  	
   

  	
  8.01 (c)

  	
   

  
	
   

  	
   

  	
  (e)

  	
   

  	
  7.14

  	
   

  
	
  Section

  	
   

  	
  316(a) (last
  sentence)

  	
   

  	
  2.10

  	
   

  
	
   

  	
   

  	
  (a)(1)

  	
   

  	
  7.12, 7.13

  	
   

  
	
   

  	
   

  	
  (a)(2)

  	
   

  	
  N.A.

  	
   

  
	
   

  	
   

  	
  (b)

  	
   

  	
  7.08

  	
   

  
	
   

  	
   

  	
  (c)

  	
   

  	
  12.05(e)

  	
   

  
	
  Section

  	
   

  	
  317(a)

  	
   

  	
  7.03, 7.04(a)

  	
   

  
	
   

  	
   

  	
  (b)

  	
   

  	
  2.04

  	
   

  
	
  Section

  	
   

  	
  318(a)

  	
   

  	
  12.01

  	
   

  
	
   

  	
   

  	
  (b)

  	
   

  	
  N.A.

  	
   

  
	
   

  	
   

  	
  (c)

  	
   

  	
  12.01

  	
   

  

 

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

**                                     N.A. means Not Applicable.

 

vi

 

THIS INDENTURE, dated as of June 9,
2009, is among Steel Dynamics, Inc., a corporation duly organized under
the laws of the State of Indiana (the “Company”), the Initial Subsidiary
Guarantors (as defined herein) and Wells Fargo Bank, National Association, a
national banking association, as Trustee (the “Trustee”).

 

In consideration of the
purchase of the Securities (as defined herein) by the Holders thereof, the
parties hereto agree as follows for the benefit of one another and for the
equal and ratable benefit of the Holders of the Company’s 5.125% Convertible
Senior Notes due 2014.

 

ARTICLE 1

 

DEFINITIONS AND INCORPORATION BY REFERENCE

 

Section 1.01.          Definitions.

 

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

 

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

 

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

 

“Bankruptcy Law” means Title
11 of the United States Code entitled “Bankruptcy” or any other law relating to
bankruptcy, insolvency, winding up, liquidation, reorganization or relief of
debtors, whether in effect on the date hereof or hereafter.

 

“Board of Directors” means
the board of directors of the Company or any duly authorized committee of such
board or any equivalent body in a limited partnership, limited liability
company or other entity serving substantially the same function as a board of
directors of a corporation.

 

“Board Resolution” means,
with respect to any Person, a duly adopted resolution (or other similar action)
of the Board of Directors of such Person.

 

“Business Day” means any day
other than a Saturday, a Sunday or any other day on which banks or trust
companies in The City of New York or in the city of the Corporate Trust Office
of the Trustee are authorized or required by law, or executive order to be
closed.

 

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

 

 

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

 

“Certificated Security”
means a Security that is in substantially the form attached as Exhibit A
but that does not include the legend called for by footnote 1 thereof or the
Schedule of Exchanges of Securities thereof.

 

“close of business” means
5:00 p.m. New York City time.

 

“Closing Date” means June 9,
2009.

 

“Common Equity” of any
Person means Capital Stock of the class or classes pursuant to which the
holders of such Capital Stock have the general voting power under ordinary
circumstances to elect at least a majority of the board of directors, managers
or trustees of such Person (irrespective of whether or not at the time Capital
Stock of any other class or classes shall have or might have voting power by reason
of the happening of any contingency).

 

“Common Stock” means the
common stock of the Company, par value $0.0025 per share, or any successor
common stock thereto.

 

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

 

“Company Request” or “Company
Order” means a written request or order signed in the name of the Company by
any one of its Chairman of the Board, its Chief Executive Officer, its
President, its Chief Operating Officer, its Chief Financial Officer or a Vice
President (regardless of Vice Presidential designation), and by any one of its
Treasurer, an Assistant Treasurer, any other Vice President (regardless of Vice
Presidential designation), its Secretary or an Assistant Secretary, and
delivered to the Trustee.

 

“Continuing
Directors” means (i) individuals who on the date of original issuance of
the Securities constituted the Company’s Board of Directors (ii) any new
directors whose election to the Company’s Board of Directors or whose
nomination for election by the Company’s stockholders was approved by at least
a majority of the directors then still in office (or a duly constituted
committee thereof), either who were directors on the date of original issuance
of the Securities or whose election or nomination for election was previously
so approved.

 

“Conversion
Price” means, in respect of each Security, as of any date, $1,000,
divided by the Conversion Rate as of such date.

 

“Conversion
Rate” means, initially, 56.9801 shares of Common Stock per $1,000
principal amount of Securities, subject to adjustment as set forth herein.

 

“Corporate Trust Office”
means the office of the Trustee at which at any particular time its corporate
trust business shall be principally administered, which office at the date
hereof is located at 230 West Monroe Street, Suite 2900,
Chicago, IL 60606, Attention: Corporate Trust Services, or such other
address as the Trustee may designate from time to time by notice to the 

 

2

 

Company,
or the principal corporate trust office of any successor Trustee (or such other
address as such successor Trustee may designate from time to time by notice to
the Company).

 

“Credit Agreement” means the Amended and Restated Credit Agreement, dated as of June 19,
2007, among the Company, as Borrower, certain designated “Initial Lenders,”
National City Bank, as Collateral Agent, National City Bank and Wells Fargo,
National Association, as Co-Administrative Agents, Bank of America, N.A. and
National City Bank, as Syndication Agents, National City Bank, as Paying Agent,
Bank of America, N.A., General Electric Capital Corporation, Fifth Third Bank
and BMO Capital Markets Financing, Inc., as Documentation Agents, and Banc
of America Securities LLC and National City Bank, as Joint Lead Arrangers, and the lenders
from time to time party thereto, together with any agreements, instruments,
security agreements, guaranties and other documents executed or delivered
pursuant to or in connection with such credit agreement, as such credit
agreement or such agreements, instruments, security agreements, guaranties or
other documents may be amended, supplemented, extended, restated, renewed or
otherwise modified from time to time and any refunding, refinancing,
replacement or substitution thereof or therefor, whether with the same or
different lenders.

 

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

 

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

 

“Ex-Dividend Date” when used
with respect to any issuance or distribution, means the first date upon which a
sale of shares of Common Stock does not automatically transfer the right to
receive the relevant dividend or distribution from the seller of such Common
Stock to its buyer.

 

“Final Maturity Date” means June 15,
2014.

 

“Fundamental
Change” will be deemed to have occurred at the time after the Securities
are originally issued if any of the following occurs:

 

(1)           a
“person” or “group” within the meaning of Section 13(d) of the
Exchange Act, other than the Company, its Subsidiaries, and its and their
employee benefit plans, has become the direct or indirect “beneficial owner,”
as defined in Rule 13d-3 under the Exchange Act, of the Company’s Common
Equity representing more than 50% of the voting power of the Company’s Common
Equity;

 

(2)           consummation
of any share exchange, consolidation or merger of the Company or other
transaction or series of transactions pursuant to which the Common Stock will
be converted into cash, securities or other property or any sale, lease or
other transfer in one transaction or a series of transactions of all or
substantially all of the consolidated assets of the Company and its
Subsidiaries, taken as a whole, to any Person other than one of the Company’s
Subsidiaries; provided, however, that a transaction where the holders of all
classes of the Company’s Common Equity immediately prior to such transaction
that is a share exchange, consolidation or merger own, directly or 

 

3

 

indirectly, more than 50% of all classes of Common
Equity of the continuing or surviving corporation or transferee or the parent
thereof immediately after such event shall not be a Fundamental Change;

 

(3)           the
first day on which a majority of the members of the Company’s Board of
Directors does not consist of Continuing Directors;

 

(4)           the
Company’s stockholders approve any plan or proposal for the liquidation or
dissolution of the Company; or

 

(5)           the
Common Stock (or other common stock into which the Securities are then
convertible) ceases to be listed or quoted on a national securities exchange in
the United States.

 

Notwithstanding the foregoing, a Fundamental Change as
a result of clause (2) above will not be deemed to have occurred if
at least 90% of the consideration received or to be received by the holders of
the Common Stock, excluding cash payments for fractional shares, in connection
with the transaction or transactions constituting the Fundamental Change
consists of Publicly Traded Securities and as a result of such transaction or
transactions the Securities become convertible into such Publicly Traded
Securities, excluding cash payments for fractional shares.

 

“GAAP” means generally
accepted accounting principles in the United States of America set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board and the Public Company Accounting
Oversight Board or in such other statements by such other entity as have been
approved by a significant segment of the accounting profession, which are in
effect from time to time.

 

“Global Security” means a
Security in global form that is in substantially the form attached as Exhibit A
and that includes the legend called for in footnote 1 thereof and the Schedule
of Exchanges of Securities thereof and which is deposited with the Depositary
or its custodian and registered in the name of the Depositary or its nominee.

 

“Guarantee” means any
obligation, contingent or otherwise, of any Person directly or indirectly
guaranteeing any Indebtedness of any other Person and, without limiting the
generality of the foregoing, 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 agreements to
keep-well, to purchase assets, goods, securities or services (unless such
purchase arrangements are on arm’s-length terms and are entered into in the
ordinary course of business), to take-or-pay, or to 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 that the term “Guarantee” shall 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” or “Holder of a
Security” means the person in whose name a Security is registered on the
Registrar’s books.

 

4

 

“Indebtedness” means
indebtedness for borrowed money.

 

“Indenture” means this
instrument as originally executed (including all exhibits and schedules
thereto) and as it may from time to time be supplemented or amended by one or
more indentures supplemental hereto entered into pursuant to the applicable
provisions hereof, including the provisions of the TIA that would be
automatically deemed to be part of this Indenture by operation of the TIA
assuming this Indenture were qualified under the TIA.

 

“Initial Subsidiary
Guarantors” means SDI Investment Co., a Delaware corporation, Steel Dynamics Sales North
America, Inc., an Indiana corporation, New Millennium Building Systems,
LLC, an Indiana limited liability company, Roanoke Electric Steel Corporation,
an Indiana corporation, New Millennium Building Systems, Inc., a South
Carolina corporation, Socar of Ohio, Inc., an Ohio corporation, Shredded
Products II, LLC, an Indiana limited liability company, John W. Hancock, Jr.,
LLC, a Virginia limited liability company, Steel of West Virginia, Inc., a
Delaware corporation, Steel Ventures, Inc., a Delaware corporation, SWVA, Inc.,
a Delaware corporation, Marshall Steel Inc., a Delaware corporation, The Techs
Industries, Inc., a Delaware corporation, OmniSource Corporation, an
Indiana corporation, Admetco, Inc., an Indiana corporation, Auburn
Investment Company, LLC, an Indiana limited liability company, Capitol City
Metals, LLC, an Indiana limited liability company, Global Shredding
Technologies, Ltd., LLC, an Indiana limited liability company, Industrial Scrap
Corporation, an Indiana corporation, Industrial Scrap, LLC, an Indiana limited
liability company, Jackson Iron & Metal Company, Inc., a Michigan
corporation, Lucky Strike Metals, LLC, an Indiana limited liability company,
Michigan Properties Ecorse, LLC, an Indiana limited liability company,
OmniSource Athens Division, LLC, an Indiana limited liability company,
OmniSource Bay City, LLC, an Indiana limited liability company, OmniSource
Indianapolis, LLC, an Indiana limited liability company, OmniSource, LLC, an
Indiana limited liability company, OmniSource Mexico, LLC, an Indiana limited
liability company, OmniSource Transport, LLC, an Indiana limited liability
company, Recovery Technologies, LLC, an Indiana limited liability company,
Scientific Recycling Group, LLC, an Indiana limited liability company, Superior
Aluminum Alloys, LLC, an Indiana limited liability company, and OmniSource
Southeast, LLC, a Delaware limited liability company, Carolinas Recycling
Group, LLC, a South Carolina limited liability company,  Atlantic
Scrap and Processing — Wilmington, LLC, a North Carolina limited liability
company, Cohen & Green Salvage Co., Inc., a North Carolina
corporation, Raeford Salvage Company, Inc., a North Carolina corporation,
and Lumberton Recycling Company, Inc. a North Carolina corporation.

 

“Interest Payment Date”
means June 15 and December 15 of each year, commencing December 15,
2009.

 

“Last Reported
Sale Price” of the Common Stock on any date means the closing sale price
per share of Common Stock (or if no closing sale price is reported, the average
of the bid and ask prices or, if more than one in either case, the average of
the average bid and the average ask prices) on that date as reported in
composite transactions for the principal U.S. securities exchange on which the
Common Stock is traded. If the Common Stock is not listed for trading on a U.S.
national or regional securities exchange on the relevant date, the “Last Reported Sale Price” shall be the
last quoted bid price for the Common Stock in the over-the-counter market on
the relevant date as reported by Pink Sheets LLC or a similar organization. If
the Common Stock 

 

5

 

is not so quoted, the “Last Reported Sale Price” shall be the average of the mid-point of
the last bid and ask prices for the Common Stock on the relevant date from each
of at least three nationally recognized independent investment banking firms
selected by the Company for this purpose.

 

“Make-Whole
Fundamental Change” means any transaction or event that constitutes a
Fundamental Change (determined after giving effect to any exceptions or
exclusions to such definition, but without regard to the proviso in clause (2) of
the definition thereof).

 

“Note Guarantee” means a Guarantee of the obligations
of the Company under this Indenture and the Securities by any Subsidiary
Guarantor.

 

“Officer” means the
Chairman, any Vice Chairman, the President, the Chief Executive Officer, any
Vice President, the Chief Financial Officer, the Chief Operating Officer, the
Treasurer or any Assistant Treasurer, or the Secretary or any Assistant
Secretary of the Company.

 

“Officer’s Certificate”
means a certificate signed by an Officer of the Company and delivered to the
Trustee; provided, however,
that for purposes of Section 5.03, “Officer’s Certificate” means a
certificate signed by the principal executive officer, principal financial
officer, principal operating officer or principal accounting officer of the Company
and each Subsidiary Guarantor.

 

“open of business” means
9:00 a.m. (New York City time).

 

“Operating Property” means
any real property, including any manufacturing plant or warehouse erected
thereon, or equipment located in the United States owned by, or leased to, the
Company, or any Subsidiary of the Company, that has a market value in excess of
$50.0 million.

 

“Opinion of Counsel” means a
written opinion of counsel, who may be an employee of or counsel for the
Company, any Subsidiary Guarantor or the Trustee and which opinion shall be in
form and substance reasonably satisfactory to the Trustee.

 

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

 

“Publicly
Traded Securities” means, in respect of a transaction described in
clause (2) of the definition of Fundamental Change, shares of common
stock traded on the New York Stock Exchange, the NASDAQ Stock Market LLC or the
NASDAQ Global Select Market (or any or their respective successors) or which
will be so traded when issued or exchanged in connection with a Fundamental
Change.

 

“Redemption Date” means the
date specified in a notice of redemption on which the Securities may be
redeemed in accordance with the terms of the Securities and this Indenture.

 

“Registrar” means initially
the Trustee.

 

6

 

“Regular
Record Date” means, with respect to the payment of interest on the
Securities, the June 1 (whether or not a Business Day) immediately
preceding an Interest Payment Date on June 15 and the December 1
(whether or not a Business Day) immediately preceding an Interest Payment Date
on December 15.

 

“Restricted Subsidiary” means any Subsidiary of the
Company other than an Unrestricted Subsidiary.

 

“Scheduled Trading Day”
means a day that is scheduled to be a Trading Day on the principal United
States national or regional securities exchange or
market on which the Common Stock is listed or admitted for trading.  If the Common Stock is not so listed or
admitted for trading, “Scheduled
Trading Day” means a Business Day.

 

“SEC” means the U.S.
Securities and Exchange Commission.

 

“Securities” means up to
$287,500,000 aggregate principal amount of 5.125% Convertible Senior Notes due
2014, or any $1,000 principal amount thereof (each a “Security”), as amended or
supplemented from time to time, that are issued under this Indenture.

 

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

 

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

 

“Significant Subsidiary”
means, at any date of determination, any Restricted Subsidiary that would
constitute a “significant subsidiary” within the meaning of Article 1 of
Regulation S-X of the Securities Act as in effect on the Closing Date; provided
that all references to 10% in the definition of “significant subsidiary” in Article 1
of Regulation S-X of the Securities Act shall be deemed to be 7.5%.

 

“Special Record Date” for
the payment of any Defaulted Interest means a date fixed by the Trustee
pursuant to Section 2.16.

 

“Stated Maturity” means,
with respect to any installment of interest or principal on any Security, the
date on which such payment of interest or principal shall become due and
payable.

 

“Subsidiary” means, with
respect to any specified Person:  (1) any
corporation, association or other business entity of which more than 50% of the
total voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers
or trustees of the corporation, association or other business entity is at the
time owned or controlled, directly or indirectly, by that Person or one or more
of the other Subsidiaries of that Person (or a combination thereof); or (2) any
partnership (a) the sole general partner or the managing general partner
of which is such Person or a Subsidiary of such Person or (b) the only
general partners of which are that Person or one or more Subsidiaries of that
Person (or any combination thereof).

 

“Subsidiary Guarantor” means
any Initial Subsidiary Guarantor and any other Subsidiary of the Company which
provides a Note Guarantee of the Company’s obligations under the 

 

7

 

Indenture
and the Securities, until such Note Guarantee is released in accordance with
the terms of this Indenture.

 

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

 

“Trading Day”
means a day on which (i) trading in the Common Stock generally occurs on
the NASDAQ Global Select Market or, if the Common Stock is not then listed on
the NASDAQ Global Select Market, on the principal other United States national
or regional securities exchange on which the Common Stock is then listed or, if
the Common Stock is not then listed on a United States national or regional
securities exchange, in the principal other market on which the Common Stock is
then traded, and (ii) a Last Reported Sale Price for the Common Stock is
available on such securities exchange or market. If the Common Stock (or other
security for which a closing sale price must be determined) is not so listed or
traded, “Trading Day” means a
Business Day.

 

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

 

“Trust Officer” means, with
respect to the Trustee, any officer within the corporate trust department of
the Trustee, including any vice president, assistant vice president, assistant
secretary, assistant treasurer, trust officer or any other officer of the
Trustee who customarily performs functions similar to those performed by the
Persons who at the time shall be such officers, respectively, or to whom any
corporate trust matter is referred because of such person’s knowledge of and
familiarity with the particular subject and who shall have direct
responsibility for the administration of this Indenture.

 

“Unrestricted Subsidiary” means STLD Holdings, Inc.,
Dynamic Aviation, LLC, Paragon Steel Enterprises, LLC, Speedbird Aviation, LLC
and each of their respective direct and indirect Subsidiaries; provided, however, in the event (a) any
such Subsidiary Guarantees Indebtedness of the Company or any Subsidiary
Guarantor in an aggregate amount exceeding $50 million or (b) the Company
or any of its Subsidiaries (other than an Unrestricted Subsidiary) contributes
or otherwise transfers (other than a sale for fair market value) any Operating
Property (including shares of stock of a Subsidiary that owns the Operating
Property) to such Subsidiary, in either case such Subsidiary shall cease to be
an Unrestricted Subsidiary and if such Subsidiary would be a Significant
Subsidiary, such Subsidiary will Guarantee payment of the principal of, premium
if any and interest on the Securities.

 

“U.S.” means the United
States of America.

 

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

 

8

 

Section 1.02.          Other Definitions.

 

	
  Term

  	
   

  	
  Defined in Section

  
	
  “Act”

  	
   

  	
  12.05(a)

  
	
  “Additional
  Shares”

  	
   

  	
  4.06(a)

  
	
  “Adjusted
  Net Assets”

  	
   

  	
  11.01

  
	
  “Agent
  Members”

  	
   

  	
  2.01(b)

  
	
  “Clause
  A Distribution”

  	
   

  	
  4.04(c)

  
	
  “Clause
  B Distribution”

  	
   

  	
  4.04(c)

  
	
  “Clause
  C Distribution”

  	
   

  	
  4.04(c)

  
	
  “Conversion
  Agent”

  	
   

  	
  2.03(a)

  
	
  “Conversion
  Date”

  	
   

  	
  4.02(b)

  
	
  “Conversion
  Notice”

  	
   

  	
  4.02(b)

  
	
  “DTC”

  	
   

  	
  2.01(a)

  
	
  “Defaulted
  Interest”

  	
   

  	
  2.16

  
	
  “Depositary”

  	
   

  	
  2.01(a)

  
	
  “Dividend
  Threshold Amount”

  	
   

  	
  4.04(d)

  
	
  “Effective
  Date”

  	
   

  	
  4.06(c)

  
	
  “Event
  of Default”

  	
   

  	
  7.01(a)

  
	
  “Fundamental
  Change Company Notice”

  	
   

  	
  3.08(b)

  
	
  “Fundamental
  Change Purchase Date”

  	
   

  	
  3.08(a)

  
	
  “Fundamental
  Change Purchase Notice”

  	
   

  	
  3.08(c)

  
	
  “Fundamental
  Change Purchase Price”

  	
   

  	
  3.08(a)

  
	
  “Funding
  Guarantor”

  	
   

  	
  11.01

  
	
  “in
  connection with”

  	
   

  	
  4.06

  
	
  “Merger
  Event”

  	
   

  	
  4.07(a)

  
	
  “Notice
  of Default”

  	
   

  	
  7.01(b)

  
	
  “Outstanding”

  	
   

  	
  2.09(a)

  
	
  “Paying
  Agent”

  	
   

  	
  2.03(a)

  
	
  “Primary
  Registrar”

  	
   

  	
  2.03(a)

  
	
  “Redemption
  Price”

  	
   

  	
  3.01

  
	
  “Reference
  Property”

  	
   

  	
  4.07(a)

  
	
  “Registrar”

  	
   

  	
  2.03(a)

  
	
  “Special
  Interest”

  	
   

  	
  7.02(c)

  
	
  “Special
  Payment Date”

  	
   

  	
  2.16(a)

  
	
  “Spin-Off”

  	
   

  	
  4.04(c)

  
	
  “Stock
  Price

  	
   

  	
  4.06(c)

  
	
  “Trigger
  Event”

  	
   

  	
  4.04(c)

  
	
  “Valuation
  Period”

  	
   

  	
  4.04(c)

  

 

Section 1.03.          Trust Indenture Act Provisions.

 

Whenever this Indenture
refers to a provision of the TIA, that provision is incorporated by reference
in and made a part of this Indenture. 
The following TIA term used in this Indenture has the following meaning:

 

9

 

“obligor” on the indenture
securities means the Company, each Subsidiary Guarantor or any other obligor on
the Securities.

 

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

 

Section 1.04.          Rules of Construction.

 

For
all purposes of this Indenture, except as otherwise provided or unless the
context otherwise requires:

 

(1)  a term has the
meaning assigned to it;

 

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

 

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

 

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

 

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

 

(6)  the terms “include”,
“including”, and similar terms should be construed as if followed by the phrase
“without limitation”;

 

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

 

(8)  all “Article”, “Exhibit”
and “Section” references are to Articles, Exhibits and Sections, respectively,
of or to this Indenture unless otherwise specified herein, and the terms “hereunder,”
“herein,” “hereof” and other words of similar import refer to this Indenture as
a whole and not to any particular Article, Section or other subdivision.

 

ARTICLE 2

 

THE SECURITIES

 

Section 2.01.          Form and Dating.

 

The Securities and the
Trustee’s certificate of authentication shall be substantially in the
respective forms set forth in Exhibit A, which Exhibit is
incorporated in and made part of this Indenture.  The Securities may include such letters,
numbers or other marks of identification and such notations, legends,
endorsements or changes as the Officer 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 by
the Trustee, the Depositary, or as may 

 

10

 

be
required to comply with any applicable law or with any rule or regulation
made pursuant thereto or with any rule or regulation of any national
securities exchange or automated quotation system on which the Securities may
be listed or quoted, or to conform to usage, or to indicate any special
limitations or restrictions to which any particular Securities are
subject.  Each Security shall be dated
the date of its authentication.

 

(a)           Global Securities. 
All of the Securities are being offered and sold in a distribution in
reliance on an effective registration statement under the Securities Act and
shall be issued initially in the form of one or more Global Securities, which
shall be deposited on behalf of the purchasers of the Securities represented
thereby with the Trustee, at its Corporate Trust Office, as Securities
Custodian for the depositary, The Depository Trust Company (“DTC”, and such
depositary, or any successor thereto, being hereinafter referred to as the “Depositary”),
and registered in the name of its nominee, Cede & Co.  (or any successor thereto), for the accounts
of participants in the Depositary, duly executed by the Company and
authenticated by the Trustee as hereinafter provided.  The aggregate principal amount of the Global
Security may from time to time be increased or decreased by adjustments made on
the records of the Securities Custodian and the Depositary as hereinafter
provided, subject in each case to compliance with the Applicable Procedures and
Section 2.13, as applicable.

 

(b)           Global Securities In General.  The Global Security shall represent such of
the outstanding Securities as shall be specified therein and each shall provide
that it shall represent the aggregate principal amount of outstanding
Securities from time to time endorsed thereon and that the aggregate principal
amount of outstanding Securities represented thereby may from time to time be
reduced or increased, as appropriate, to reflect exchanges, purchases or
conversions of such Securities.

 

Members of, or participants
in, the Depositary (“Agent Members”) shall have no rights under this
Indenture with respect to any Global Security held on their behalf by the
Depositary or under the Global Security, and the Depositary (including, for
this purpose, its nominee) may be treated by the Company, the Trustee and any
agent of the Company or the Trustee as the absolute owner and Holder of such
Global Security for all purposes whatsoever.

 

Notwithstanding the foregoing,
nothing herein shall (1) prevent the Company, the Trustee or any agent of
the Company or the Trustee from giving effect to any written certification,
proxy or other authorization furnished by the Depositary or (2) impair, as
between the Depositary and its Agent Members, the operation of customary
practices governing the exercise of the rights of a Holder of any Security.

 

(c)           Book Entry Provisions.  The Company shall execute and the Trustee
shall, in accordance with this Section 2.01(c), authenticate and deliver
initially one or more Global Securities that (1) shall be registered in
the name of the Depositary or its nominee, (2) shall be delivered by the
Trustee to the Depositary or pursuant to the Depositary’s instructions and (3) shall
bear legends substantially to the following effect:

 

“UNLESS THIS CERTIFICATE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND

 

11

 

ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH
OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE &
CO., HAS AN INTEREST HEREIN.  THIS
SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE
THEREOF.  THIS SECURITY IS EXCHANGEABLE
FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR
ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND,
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY
THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY
TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR
ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY.”

 

Section 2.02.          Execution
and Authentication.

 

(a)           The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is limited to $287,500,000
aggregate principal amount, except as provided in Sections 2.07 and 2.08.

 

(b)           The Securities shall be executed on behalf of the Company
by one of its Officers.  The signatures
of any of the Officers on the Securities may be manual or facsimile.

 

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

 

(d)           No Security or Guarantee endorsed thereon 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 duly executed by the Trustee by
manual signature of an authorized signatory, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such
Security has been duly authenticated and delivered hereunder and is entitled to
the benefits of this Indenture.

 

(e)           The Trustee shall authenticate and make available for
delivery Securities for original issue in the aggregate principal amount of up
to $287,500,000 upon receipt of a Company Order, Officer’s Certificate and an
Opinion of Counsel.  The Company Order
shall specify the amount of Securities to be authenticated, shall provide that
all such Securities will be represented by a Global Security and shall state
the date on which each original issue of Securities is to be authenticated. The
Officer’s Certificate shall state that all covenants and 

 

12

 

conditions precedent to the execution, authentication and delivery of
the Securities have been complied with. The Opinion of Counsel shall state
substantially to the following effect, which Opinion of Counsel may contain
such assumptions, qualifications and limitations as such counsel shall
reasonably deem appropriate: (i) the form or forms and terms of the
Securities of such series have been established in compliance with this
Indenture, and (ii) the Indenture and such Securities have been duly
authorized and, if executed and authenticated in accordance with the provisions
of the Indenture and delivered and duly paid for, would be entitled to the
benefits of the Indenture and will constitute valid and legally binding
obligations of the Company and each Subsidiary Guarantor, enforceable against
the Company and each Subsidiary Guarantor in accordance with their respective
terms, subject to bankruptcy, insolvency, reorganization, receivership,
moratorium and other similar laws affecting creditors’ rights generally and
general principles of equity (regardless of whether enforceability is
considered in a proceeding of equity or law).

 

(f)            The Trustee shall act as the initial authenticating
agent.  Thereafter, the Trustee may
appoint an authenticating agent acceptable to the Company to authenticate
Securities.  An authenticating agent may
authenticate Securities whenever the Trustee may do so.  Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent.  An authenticating agent shall have the same
rights as an Agent to deal with the Company or any Subsidiary Guarantor or an
Affiliate of the Company or any Subsidiary Guarantor.

 

(g)           The Securities shall be issuable only in registered form
without coupons and only in denominations of $1,000 principal amount and
multiples of $1,000 thereof.

 

Section 2.03.          Registrar, Paying Agent and
Conversion Agent.

 

(a)           The Company shall maintain one or more offices or agencies
where Securities may be presented for registration of transfer or for exchange
(each, a “Registrar”), one or more offices or agencies where Securities
may be presented or surrendered for payment (each, a “Paying Agent”),
one or more offices or agencies where Securities may be presented for
conversion (each, a “Conversion Agent”) and one or more offices or
agencies where notices and demands to or upon the Company in respect of the
Securities and this Indenture may be served. 
The Company will at all times maintain a Paying Agent, Conversion Agent,
Registrar and an office or agency where notices and demands to or upon the
Company in respect of the Securities and this Indenture may be served.  One of the Registrars (the “Primary
Registrar”) shall keep a register of the Securities and of their transfer
and exchange.  At the option of the
Company, any payment of cash may be made by check mailed to the Holders at
their addresses set forth in the register of Holders.

 

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

 

13

 

Company or any Affiliate of the Company may
act as Paying Agent (except for the purposes of Article 9).

 

(c)           The Company hereby initially designates the Trustee as
Paying Agent, Registrar, Primary Registrar, Securities Custodian and Conversion
Agent, and designates the Corporate Trust Office of the Trustee as the office
or agency of the Company for each of the aforesaid purposes and as the office
or agency where notices and demands to or upon the Company in respect of the
Securities and this Indenture may be served.

 

Section 2.04.          Paying Agent To Hold Money in Trust.

 

Unless otherwise specified
herein, prior to 10:00 a.m., New York City time, on each due date of the
payment of principal of, or interest (including Special Interest), if any, on
any Securities, the Company shall deposit a sum sufficient to pay such principal
or interest (including Special Interest), if any, so becoming due.  A Paying Agent shall hold in trust for the
benefit of Holders of Securities or the Trustee all money held by the Paying
Agent for the payment of principal of, or interest (including Special
Interest), if any, on, the Securities, and shall notify the Trustee of any
failure by the Company (or any other obligor on the Securities) to make any
such payment.  If the Company or an
Affiliate of the Company acts as Paying Agent, it shall, before 10:00 a.m.,
New York City time, on each due date of the principal of, or interest
(including Special Interest), if any, on, any Securities, segregate the money
and hold it as a separate trust fund for the benefit of Holders.  The Company at any time may require a Paying
Agent to pay all money held by it to the Trustee, and the Trustee may at any
time during the continuance of any Default, upon written request to a Paying
Agent, require such Paying Agent to pay forthwith to the Trustee all sums so held
in trust by such Paying Agent.  Upon
doing so, the Paying Agent (other than the Company) shall have no further
liability for the money so paid to the Trustee.

 

Subject to applicable
abandoned property law, any money deposited with the Trustee or any Paying
Agent, or then held by the Company, in trust for the payment of the principal
of or interest (including Special Interest), if any, on any Security and
remaining unclaimed for two years after such principal or interest (including
Special Interest), if any, has become due and payable shall promptly be paid to
the Company or (if then held by the Company) shall be discharged from such
trust; and the Holder of such Security shall thereafter, as an unsecured
general creditor, look only to the Company for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that
the Trustee or such Paying Agent, before being required to make any such
repayment, may at the expense of the Company cause to be published once, in a
newspaper published in the English language, customarily published on each
Business Day and of general circulation in The City of New York, notice that
such money remains unclaimed and that, after a date specified therein, which
shall not be less than 30 days from the date of such publication, any unclaimed
balance of such money then remaining will promptly be repaid to the Company.

 

Section 2.05.          Conversion Agent To Hold Money in
Trust.

 

The Company shall require
each Conversion Agent (that is not the Trustee) to agree in writing that the
Conversion Agent will hold in trust for the benefit of Holders or the Trustee
all 

 

14

 

cash
and shares of Common Stock delivered by the Company to the Conversion Agent for
the delivery of amounts due upon conversion, and will notify the Trustee of any
default by the Company in making any such delivery.

 

While any such default
continues, the Trustee may require a Conversion Agent to deliver all cash and
shares of Common Stock delivered by the Company to it to the Trustee.  Upon payment over to the Trustee, the
Conversion Agent (if other than the Company or a Subsidiary) shall have no further
liability in respect of such amounts.  If
the Company or a Subsidiary acts as Conversion Agent, it shall segregate and
hold in a separate trust fund for the benefit of the Holders all cash and
shares of Common Stock held by it as Conversion Agent.  Upon any bankruptcy or reorganization
proceedings relating to the Company, the Trustee shall serve as Conversion
Agent for the Securities.

 

Section 2.06.          Lists of Holders of Securities.

 

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 of Securities.  The Company shall furnish or cause the
Registrar to furnish to the Trustee (a) semiannually, not more than 10
days after each Regular Record Date, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Holders as of such
Regular Record Date; and (b) at such other times as the Trustee may
request in writing, within 30 days after receipt by the Company of any such
request, a list of similar form and content to that in subsection (a) hereof
as of a date not more than 15 days prior to the time such list is furnished; provided, however, that
if and so long as the Trustee shall be the Primary Registrar, no such list need
be furnished.

 

Section 2.07.          Transfer and Exchange.

 

(a)           Subject to compliance with any applicable additional
requirements contained in Section 2.13, when a Security is presented to a
Registrar with a request to register a transfer thereof or to exchange such Security
for an equal principal amount of Securities of other authorized denominations,
the Registrar shall register the transfer or make the exchange as requested if
its requirements for such transactions are met; provided,
however, that every Security presented
or surrendered for registration of transfer or exchange shall be duly endorsed
or accompanied by an assignment form and, if applicable, a transfer certificate
each substantially in the form included in Exhibit A, and completed in a
manner satisfactory to the Registrar and duly executed by the Holder thereof or
its attorney duly authorized in writing. 
To permit registration of transfers and exchanges, upon surrender of any
Security for registration of transfer or exchange at an office or agency maintained
pursuant to Section 2.03(a), the Company shall execute and the Trustee
shall authenticate Securities of a like aggregate principal amount at the
Registrar’s request.  Any exchange or
transfer shall be without charge, except that the Company or the Registrar may
require payment of a sum sufficient to cover any transfer tax or similar
governmental charge that may be imposed in relation thereto; provided that this
sentence shall not apply to any exchange pursuant to Section 2.11, 4.02(d) or
10.06.

 

(b)           Neither the Company, any Registrar nor the Trustee shall
be required to register the transfer of or exchange any Securities or portions
thereof in respect of which a Fundamental 

 

15

 

Change Purchase Notice has been delivered and
not withdrawn by the Holder thereof (except, in the case of the purchase of a
Security in part, the portion thereof not to be purchased).

 

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

 

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

 

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

 

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

 

Section 2.08.          Replacement Securities.

 

(a)           If (1) any mutilated Security is surrendered to the
Trustee, or (2) the Company and the Trustee receive evidence to their
satisfaction of the destruction, loss or theft of any Security, and there is
delivered to the Company and the Trustee, such security or indemnity, in each
case, as may be required by them to save each of them harmless from any loss,
expense, claim or liability, then, in the absence of notice to the Company or
the Trustee that such Security has been acquired by a protected purchaser, the
Company shall execute and upon a Company Request the Trustee shall authenticate
and deliver, in exchange for any such mutilated Security or in lieu of any such
destroyed, lost or stolen Security, a replacement Security of like tenor and
principal amount, bearing a number not contemporaneously outstanding.

 

(b)           If any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, or is about to be purchased
by the Company pursuant to Article 3, or converted pursuant to Article 4,
the Company in its discretion may, instead of issuing a new Security, pay, purchase
or convert such Security, as the case may be.

 

(c)           Upon the issuance of any new Securities under this Section 2.08,
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 counsel and the Trustee) in
connection therewith.

 

16

 

(d)           Every new Security issued pursuant to this Section 2.08
in lieu of any mutilated, destroyed, lost or stolen Security shall constitute
an original additional contractual obligation of the Company and each
Subsidiary Guarantor, whether or not the mutilated, destroyed, lost or stolen
Security shall be at any time enforceable by anyone, and shall be entitled to
all benefits of this Indenture equally and proportionately with any and all
other Securities duly issued hereunder.

 

(e)           The provisions of this Section 2.08 are (to the
extent lawful) exclusive and shall preclude (to the extent lawful) all other
rights and remedies with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Securities.

 

Section 2.09.          Outstanding Securities.

 

(a)           Securities outstanding (“Outstanding”) at any time
are all Securities authenticated by the Trustee, except for those canceled by
it, those purchased pursuant to Article 3, those converted pursuant to Article 4,
those delivered to the Trustee for cancellation or surrendered for transfer or
exchange and those described in this Section 2.09 as not Outstanding.

 

(b)           If a Security is replaced pursuant to Section 2.08,
such replaced Security ceases to be Outstanding unless the Company receives
proof satisfactory to it that the replaced Security is held by a protected
purchaser.

 

(c)           If a Paying Agent holds in respect of the Outstanding
Securities on a Redemption Date, Fundamental Change Purchase Date or the Final
Maturity Date, as the case may be, money sufficient to pay the principal of and
accrued interest (including Special Interest), if any, on Securities (or
portions thereof) payable on that date, then on and after such Redemption Date,
Fundamental Change Purchase Date, Final Maturity Date, such Securities (or
portions thereof, as the case may be) shall cease to be Outstanding, interest
(including Special Interest), if any, on such Securities shall cease to accrue
and all other rights of the Holder will terminate unless otherwise specified in
this Indenture.

 

(d)           Subject to the restrictions contained in Section 2.10,
a Security does not cease to be Outstanding because the Company or an Affiliate
of the Company holds the Security.

 

Section 2.10.          Treasury Securities.

 

In determining whether the
Holders of the required principal amount of Securities have concurred in any
request, demand, authorization, notice, direction, waiver or consent,
Securities owned by the Company or any other obligor on the Securities or by
any Affiliate of the Company or of such other obligor shall be disregarded,
except that, for purposes of determining whether the Trustee shall be protected
in relying on any such request, demand, authorization, notice, direction,
waiver or consent, only Securities which a Trust Officer of the Trustee actually
knows are so owned shall be so disregarded.

 

Section 2.11.          Temporary Securities.

 

Until definitive Securities
are ready for delivery, the Company may prepare and execute, and, upon receipt
of a Company Order, the Trustee shall authenticate and deliver, temporary 

 

17

 

Securities.  Temporary Securities shall be substantially
in the form of definitive Securities but may have variations that the Company
with the consent of the Trustee considers appropriate for temporary
Securities.  Without unreasonable delay,
the Company shall prepare and the Trustee shall authenticate and deliver
definitive Securities in exchange for temporary Securities representing an
equal principal amount of Securities. 
The temporary Securities will be exchanged for definitive Securities in
accordance with Sections 2.07 and 2.13 hereof.  Until so exchanged, temporary Securities
shall have the same rights under this Indenture as the definitive Securities.

 

Section 2.12.          Cancellation.

 

The Company and any
Subsidiary Guarantor at any time may deliver Securities to the Trustee for
cancellation.  The Registrar, the Paying
Agent and the Conversion Agent shall forward to the Trustee any Securities
surrendered to them for transfer, exchange, purchase, payment or
conversion.  The Trustee and no one else
shall cancel, in accordance with its standard procedures, all Securities
surrendered for transfer, exchange, purchase, payment, conversion or cancellation
and shall dispose of the cancelled Securities in accordance with its customary
procedures or deliver the canceled Securities to the Company upon request.  All Securities which are purchased or
otherwise acquired by the Company or any of its Subsidiaries prior to the Final
Maturity Date pursuant to Article 3 shall be delivered to the Trustee for
cancellation, and the Company may not hold or resell such Securities or issue
any new Securities to replace any such Securities or any Securities that any
Holder has converted pursuant to Article 4.  The Trustee shall maintain a record of all
canceled Securities.  The Trustee shall
provide the Company a list of all Securities that have been canceled from time
to time as requested by the Company in writing.

 

Section 2.13.          Legend; Additional Transfer and Exchange
Requirements.

 

(a)           [Intentionally Omitted]

 

(b)           A Global Security may not be transferred, in whole or in
part, to any Person other than the Depositary or a nominee or any successor
thereof, and no such transfer to any such other Person may be registered; provided that the foregoing shall not prohibit any transfer
of a Security that is issued in exchange for a Global Security but is not
itself a Global Security.  No transfer of
a Security to any Person shall be effective under this Indenture or the Securities
unless and until such Security has been registered in the name of such
Person.  Notwithstanding any other
provisions of this Indenture or the Securities, transfers of a Global Security,
in whole or in part, shall be made only in accordance with this Section 2.13.

 

(c)           [Intentionally Omitted]

 

(d)           [Intentionally Omitted]

 

(e)           The provisions below
shall apply only to Global Securities or any Securities issued in exchange for
a Global Security:

 

(1)           Each Global Security authenticated under this Indenture
shall be registered in the name of the Depositary or a nominee thereof and
delivered to such Depositary or a 

 

18

 

nominee thereof or custodian therefor, and
each such Global Security shall constitute a single Security for purposes of
this Indenture.

 

(2)           Notwithstanding
any other provisions of this Indenture or the Securities, a Global Security
shall not be exchanged in whole or in part for a Security registered, and no
transfer of a Global Security in whole or in part shall be registered in the
name of any Person other than the Depositary or one or more nominees thereof; provided that a Global Security may be exchanged for
Securities registered in the names of any person designated by the Depositary
in the event that (A) the Depositary has notified the Company that it is
unwilling or unable to continue as Depositary for such Global Security or such
Depositary has ceased to be a “clearing agency” registered under the Exchange
Act, and in either case a successor Depositary is not appointed by the Company
within 60 days after receiving such notice or becoming aware that the
Depositary has ceased to be a “clearing agency” or (B) an Event of Default
has occurred and is continuing with respect to the Securities.  Any Global Security exchanged pursuant to the
preceding sentence shall be so exchanged as directed by the Depositary.  Any Security issued in exchange for a Global
Security or any portion thereof shall be a Global Security; provided, however, that
any such Security so issued that is registered in the name of a Person other
than the Depositary or a nominee thereof shall not be a Global Security.

 

(3)           Securities
issued in exchange for a Global Security or any portion thereof that are not
issued as a Global Security shall be issued in definitive, fully registered
form, without interest coupons, shall have a principal amount equal to that of
such Global Security or portion thereof to be so exchanged, shall be registered
in such names and be in such authorized denominations as the Depositary shall
designate and shall bear the applicable legends provided for herein.  Any Global Security to be exchanged in whole
shall be surrendered by the Depositary to the Trustee or the Registrar.  With regard to any Global Security to be
exchanged in part, either such Global Security shall be so surrendered for
exchange or, if the Trustee is acting as custodian for the Depositary or its
nominee with respect to such Global Security, the principal amount thereof
shall be reduced, by an amount equal to the portion thereof to be so exchanged,
by means of an appropriate adjustment made on the records of the Trustee.  Upon any such surrender or adjustment, the
Trustee shall authenticate and deliver the Security issuable on such exchange
to or upon the order of the Depositary or an authorized representative thereof.

 

(4)           Subject
to clause (6) of this Section 2.13(e), the registered Holder may
grant proxies and otherwise authorize any Person, including Agent Members and
Persons that may hold interests through Agent Members, to take any action which
a Holder is entitled to take under this Indenture or the Securities.

 

(5)           In
the event of the occurrence of any of the events specified in clause (2) of
this Section 2.13(e), the Company will promptly make available to the
Trustee a reasonable supply of Certificated Securities in definitive, fully
registered form, without interest coupons.

 

(6)           Neither
Agent Members nor any other Persons on whose behalf Agent Members may act shall
have any rights under this Indenture with respect to any Global 

 

19

 

Security registered in the name of the Depositary or any nominee
thereof, or under any such Global Security, and the Depositary or such nominee,
as the case may be, may be treated by the Company, the Trustee and any agent of
the Company or the Trustee as the absolute owner and Holder of such Global
Security for all purposes whatsoever. 
Notwithstanding the foregoing, nothing herein shall (i) prevent the
Company, the Trustee or any agent of the Company or the Trustee from giving
effect to any written certification, proxy or other authorization furnished by
the Depositary or such nominee, as the case may be, or (ii) impair, as
between the Depositary, its Agent Members and any other Person on whose behalf
an Agent Member may act, the operation of customary practices of such Persons
governing the exercise of the rights of a Holder of any Security.

 

(7)           At
such time as all interests in a Global Security have been converted, cancelled
or exchanged for Securities in certificated form, such Global Security shall,
upon receipt thereof, be cancelled by the Trustee in accordance with standing
procedures and instructions existing between the Depositary and the Securities
Custodian, subject to Section 2.12 of this Indenture.  At any time prior to such cancellation, if
any interest in a Global Security is converted, canceled or exchanged for
Securities in certificated form, the principal amount of such Global Security
shall, in accordance with the standing procedures and instructions existing
between the Depositary and the Securities Custodian, be appropriately reduced,
and an endorsement shall be made on such Global Security, by the Trustee or the
Securities Custodian, at the direction of the Trustee, to reflect such
reduction.

 

Section 2.14.          CUSIP Numbers.

 

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

 

Section 2.15.          Calculations.

 

Except as otherwise
specifically stated herein or in the Securities, all calculations to be made in
respect of the Securities shall be the obligation of the Company.  All calculations made by the Company or its
agent as contemplated pursuant to the terms hereof and of the Securities shall
be made in good faith and be final and binding on the Holders absent manifest
error.  The Company shall provide a
schedule of calculations to the Trustee, and the Trustee shall be entitled to
conclusively rely upon the accuracy of the calculations by the Company without
independent verification.  The Trustee
shall forward calculations made by the Company to any Holder of Securities upon
request.

 

20

 

Section 2.16.          Payment of Interest; Interest
Rights Preserved.

 

Interest (including Special
Interest), if any, on any Security which is payable, and is punctually paid or
duly provided for, on the Stated Maturity of such interest (including Special
Interest), if any, shall be paid to the Person in whose name the Security is
registered at the close of business on the Regular Record Date for such
interest payment.

 

Any
interest (including Special Interest), if any, on any Security which is
payable, but is not punctually paid or duly provided for, on the Stated
Maturity of such interest (including Special Interest), if any, and interest on
such defaulted interest at the then applicable interest rate borne by the
Securities, to the extent lawful (such defaulted interest and interest thereon
herein collectively called “Defaulted Interest”), shall forthwith cease
to be payable to the Holder on the Regular Record Date; and such Defaulted
Interest may be paid by the Company, at its election in each case, as provided
in Subsection (a) or (b) below:

 

(a)           The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities are registered at the
close of business on a Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner.  The Company shall notify the Trustee in
writing of the amount of Defaulted Interest proposed to be paid on each
Security and the date (not less than 20 days after such notice) of the proposed
payment (the “Special Payment Date”), and by 10:00 a.m. New York
City time on the date of payment the Company shall deposit with the Trustee an
amount of money equal to the aggregate amount proposed to be paid in respect of
such Defaulted Interest or shall make arrangements satisfactory to the Trustee
for such deposit prior to the Special Payment Date, such money when deposited
to be held in trust for the benefit of the Persons entitled to such Defaulted
Interest as in this subsection provided. 
Thereupon the Trustee shall fix a Special Record Date for the payment of
such Defaulted Interest which shall be not more than 15 days and not less than
10 days prior to the date of the Special Payment Date and not less than 10 days
after the receipt by the Trustee of the notice of the proposed payment.  The Trustee shall promptly notify the Company
in writing of such Special Record Date. 
Unless the Company issues a press release to the same effect, in the
name and at the expense of the Company, the Trustee shall cause notice of the
proposed payment of such Defaulted Interest and the Special Record Date
therefor to be mailed, first-class postage prepaid, to each Holder at its
address as it appears in the Security Register, not less than 10 days prior to
such Special Record Date or notify in such other manner as the Trustee
determines, including in accordance with any Applicable Procedures.  Notice of the proposed payment of such
Defaulted Interest and the Special Record Date and Special Payment Date
therefor having been so mailed or otherwise conveyed, such Defaulted Interest
shall be paid to the Persons in whose names the Securities are registered on
such Special Record Date and shall no longer be payable pursuant to the
following paragraph (b).

 

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

 

21

 

Subject to the foregoing
provisions of this Section 2.16, each Security delivered under this
Indenture upon registration of transfer of or in exchange for or in lieu of any
other Security shall carry the rights to interest (including Special Interest),
if any, accrued and unpaid, and to accrue, which were carried by such other
Security.

 

Section 2.17.          Computation of Interest.

 

Interest (including Special
Interest) on the Securities shall be computed on the basis of a 360-day year
comprised of twelve 30-day months.

 

ARTICLE 3

 

REDEMPTION AND REPURCHASE

 

Section 3.01.          Company’s Right to Redeem; Notice
to Trustee.

 

Prior to June 20, 2012,
the Securities will not be redeemable at the Company’s option.  On or after June 20, 2012, if the Last
Reported Sale Price of the Common Stock for 20 or more Trading Days (whether or
not consecutive) in a period of 30 consecutive Trading Days ending on the
Trading Day prior to the date the Company provides the notice of redemption to
Holders exceeds 130% of the applicable Conversion Price in effect on each such
Trading Day, the Company may redeem for cash all or part of the Securities,
upon notice before the Redemption Date to the Trustee and the Paying Agent as
set forth below in this Section 3.01; provided that
the Company shall not redeem the Securities if the Redemption Date would be
after the Final Maturity Date.  The
redemption price (the “Redemption Price”) shall equal to 100% of the
principal amount of the Securities being redeemed, plus any accrued and unpaid
interest (including Special Interest), if any, to, but excluding, the
Redemption Date; provided that if the Redemption
Date falls after a Regular Record Date and on or prior to the corresponding
Interest Payment Date, the Redemption Price shall be 100% of the principal
amount of the Securities redeemed but shall not include accrued and unpaid
interest(including Special Interest), if any. Instead, the Company shall pay
such accrued and unpaid interest (including Special Interest, if any), if any,
on the Interest Payment Date, to the Holder of record at the close of business
on the corresponding Regular Record Date. 
If the Company elects to redeem Securities pursuant to this Section 3.01,
it shall notify the Trustee and the Paying Agent in writing of such election
together with the Redemption Date, the Conversion Rate, the principal amount of
Securities to be redeemed and the Redemption Price.

 

The Company shall give the
notice to the Trustee and the Paying Agent of the Company’s election to redeem
Securities pursuant to this Section 3.01, at least 30 days but not more
than 60 days before the Redemption Date (subject to Section 3.03).

 

Section 3.02.          Selection
of Securities to be Redeemed.

 

If the Company decides to
redeem fewer than all of the Securities, unless the procedures of the
Depositary provide otherwise, the Trustee shall select the Securities to be
redeemed by lot, on a pro rata basis or by another method the Trustee considers
fair and appropriate.

 

22

 

Securities and portions of
Securities that the Trustee selects shall be in principal amounts of $1,000 or
a multiple of $1,000.  Provisions of this
Indenture that apply to Securities called for redemption also apply to portions
of Securities called for redemption.  The
Trustee shall notify the Company promptly (but in any case within seven days of
the Trustee’s receipt of the notice from the Company referred to in Section 3.01
unless a shorter notice is acceptable to the Company) of the Securities or
portions of the Securities selected to be redeemed and, in the case of any
Securities selected for partial redemption, the method it has chosen for the
selection of the portions of the Securities selected to be redeemed.

 

Following a notice of
redemption, Securities and portions of Securities are convertible pursuant to Article 4,
by the Holder until the close of business on the Business Day prior to the
Redemption Date.  If any Security
selected for partial redemption is converted in part before termination of the
conversion right with respect to the portion of the Security so selected, the
converted portion of such Security shall be deemed (so far as may be) to be the
portion selected for redemption. 
Securities that have been converted during a selection of Securities to
be redeemed may be treated by the Trustee as outstanding for the purpose of
such selection.

 

Section 3.03.          Notice
of Redemption.

 

At least 30 days but no more
than 60 days before a Redemption Date, the Company shall mail a notice of
redemption (substantially in the form set forth in Exhibit A) by
first-class mail, postage prepaid, to each Holder of Securities to be redeemed.

 

The
notice shall identify the Securities to be redeemed and shall state (along with
any other information the Company wishes to include):

 

(a)           the Redemption Date;

 

(b)           the Redemption Price;

 

(c)           the Conversion Rate;

 

(d)           the name and address of the Paying
Agent and Conversion Agent;

 

(e)           that Securities may be converted at
any time before the close of business on the Business Day prior to the
Redemption Date;

 

(f)            that Securities called for
redemption and not converted shall be redeemed on the Redemption Date;

 

(g)           that Holders who want to convert
their Securities must satisfy the requirements set forth in the Securities;

 

(h)           that Securities called for redemption
must be surrendered to the Paying Agent (by effecting book entry transfer of
the Securities or delivering Certificated Securities, together with necessary
endorsements, as the case may be) to collect the Redemption Price;

 

23

 

(i)            if fewer than all of the outstanding
Securities are to be redeemed, the certificate numbers, if any, and principal
amounts of the particular Securities to be redeemed;

 

(j)            that, unless the Company defaults in
making payments of such Redemption Price, interest (including Special
Interest), if any, on the Securities called for redemption shall cease to
accrue from and after the Redemption Date; and

 

(k)           the CUSIP or other similar number(s),
as the case may be, of the Securities being redeemed.

 

At the Company’s request,
the Trustee shall give the notice of redemption in the Company’s name and at
the Company’s expense, provided that
the Company makes such request at least seven Business Days (or such shorter
period as may be satisfactory to the Trustee) prior to the date by which such
notice of redemption must be given to Holders in accordance with this Section 3.03.

 

Section 3.04.          Effect
of Notice of Redemption.

 

Once notice of redemption is
given, Securities called for redemption become due and payable on the
Redemption Date and at the Redemption Price stated in the notice except for
Securities that are converted in accordance with the terms of this
Indenture.  Upon surrender to the Paying
Agent, such Securities shall be paid at the Redemption Price stated in the
notice and from and after the Redemption Date (unless the Company shall default
in the payment of the Redemption Price) such Securities shall cease to bear
interest (including Special Interest), if any, and the rights of the Holders
therein shall terminate (other than the right to receive the Redemption Price).

 

Section 3.05.          Deposit
of Redemption Price.

 

Prior to 10:00 a.m.
(New York City time), on the Redemption Date, the Company shall deposit with
the Paying Agent (or if the Company or a Subsidiary or an Affiliate of either
of them is the Paying Agent, shall segregate and hold in trust) money
sufficient to pay the Redemption Price of all Securities to be redeemed on that
date other than Securities or portions of Securities called for redemption
which on or prior thereto have been delivered by the Company to the Trustee for
cancellation or have been converted. 
Upon written request of the Company, the Paying Agent shall as promptly
as practicable return to the Company any money not required for the purpose of
paying the Redemption Price because of conversion of Securities pursuant to Article 4.  If such money is then held by the Company or
a Subsidiary or an Affiliate of either in trust and is not required for such
purpose it shall be discharged from such trust.

 

Section 3.06.          Securities Redeemed in Part.

 

Upon surrender of a Security
that is redeemed in part, the Company shall execute and the Trustee shall,
without charge, authenticate and deliver to the Holder a new Security in an
authorized denomination equal in principal amount to the unredeemed portion of
the Security surrendered.

 

Section 3.07.          [Intentionally Omitted]

 

24

 

Section 3.08.          Repurchase of Securities at Option
of the Holder upon a Fundamental Change.

 

(a)           In the event a Fundamental Change shall occur at any time
when any Securities remain outstanding, each Holder shall have the right, at
such Holder’s option, to require the Company to purchase all of such Holders’
Securities or any portion of the principal amount thereof that is equal to
$1,000 or an integral multiple thereof on a date specified by the Company (the “Fundamental
Change Purchase Date”) that is no earlier than the 20th calendar day following the date of, and no
later than the 35th calendar day following the date of, delivery
of the Fundamental Change Company Notice (as defined below) at a purchase price
in cash equal to 100% of the principal amount of the Securities tendered for
purchase, plus accrued and unpaid interest (including Special Interest), if
any,  on those Securities to, but
excluding, the Fundamental Change Purchase Date (the “Fundamental Change
Purchase Price”), subject to satisfaction by or on behalf of any Holder of
the requirements set forth in Section 3.08(c); provided
that if the Fundamental Change Purchase Date is on a date that is after a
Regular Record Date and on or prior to the corresponding Interest Payment Date,
the Fundamental Change Purchase Price shall be 100% of the principal amount of
the Securities repurchased but shall not include accrued and unpaid interest
(including Special Interest), if any. Instead, the Company shall pay such
accrued and unpaid interest (including Special Interest), if any, on the
Interest Payment Date, to the Holder of record at the close of business on the
corresponding Regular Record Date.

 

(b)           On or before the 20th calendar day
after the occurrence of a Fundamental Change, the Company shall mail a written
notice of the occurrence of the Fundamental Change and of the resulting
purchase right to the Trustee, Paying Agent and to each Holder of record of
Securities (a “Fundamental Change Company Notice”).  The Fundamental Change Company Notice shall
include the form of a Fundamental Change Purchase Notice (defined below) to be
completed by the Holder and shall state:

 

(1)           the
events causing such Fundamental Change;

 

(2)           the
date of such Fundamental Change;

 

(3)           the
last date by which the Fundamental Change Purchase Notice must be delivered to
elect the purchase option pursuant to this Section 3.08;

 

(4)           the
Fundamental Change Purchase Date;

 

(5)           the
Fundamental Change Purchase Price;

 

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

 

(7)           the
name and address of each Paying Agent and Conversion Agent;

 

(8)           the
then effective Conversion Rate and any adjustments to the Conversion Rate
resulting from such Fundamental Change;

 

25

 

(9)           the
procedures that the Holder must follow to exercise rights under Article 4
of this Indenture and that the Securities as to which a Fundamental Change
Purchase Notice has been given may be converted into Common Stock pursuant to Article 4
of this Indenture only to the extent that the Fundamental Change Purchase
Notice has been withdrawn in accordance with the terms of this Indenture;

 

(10)         the
procedures that the Holder must follow to exercise rights under this Section 3.08;

 

(11)         the
procedures for withdrawing a Fundamental Change Purchase Notice;

 

(12)         that,
unless the Company fails to pay such Fundamental Change Purchase Price,
Securities covered by any Fundamental Change Purchase Notice will cease to be
outstanding and interest, (including Special Interest), if any, will cease to
accrue on and after the Fundamental Change Purchase Date; and

 

(13)         the
CUSIP number of the Securities.

 

At
the Company’s written request, the Trustee shall give such Fundamental Change
Company Notice in the Company’s name and at the Company’s expense; provided that, in all cases, the text of such Fundamental
Change Company Notice shall be prepared by the Company; provided that the Company makes such
request at least seven Business Days (or such shorter period as may be
satisfactory to the Trustee) prior to the date by which such Fundamental Change
Company Notice must be given to Holders in accordance with this Section 3.08.  In connection with the delivery of the
Fundamental Change Notice to the Holders, the Company shall publish a notice
containing substantially the same information that is required in the
Fundamental Change Company Notice in a newspaper of general circulation in the
City of New York or publish information on a website of the Company or through
such other public medium the Company may use at that time.  If any of the Securities is in the form of a
Global Security, then the Company shall modify such notice to the extent
necessary to accord with the Applicable Procedures relating to the purchase of
Global Securities.  No failure of the Company to give the Fundamental Change Company Notice
and no defect therein shall limit the purchase rights of the Holders of
Securities or affect the validity of the proceedings for the purchase of the
Securities pursuant to this Section 3.08.

 

(c)           A Holder may exercise its rights specified in Section 3.08(a) upon
delivery of a written notice (which shall be in substantially the form set
forth in the form of Security attached as Exhibit A under the heading “Fundamental
Change Purchase Notice” and which may be delivered by letter, overnight
courier, hand delivery, facsimile transmission or in any other written form
and, in the case of Global Securities, may be delivered electronically or by
other means in accordance with the Depositary’s Applicable Procedures) of the
exercise of such rights (a “Fundamental Change Purchase Notice”) to the
Paying Agent at any time prior to the close of business on the Business Day
immediately preceding the Fundamental Change Purchase Date, subject to
extension to comply with applicable law.

 

(1)           The
Fundamental Change Purchase Notice shall state: 
(A) if Certificated Securities are to be purchased, the certificate
numbers of the Securities which the Holder 

 

26

 

will deliver to be purchased (or, if the Security is held in global
form, any other items required to comply with the Applicable Procedures), (B) the
portion of the principal amount of the Securities which the Holder will deliver
to be purchased, which portion must be a principal amount of $1,000 or any
integral multiple thereof and (C) that such Security shall be purchased as
of the Fundamental Change Purchase Date pursuant to the terms and conditions
specified in the Securities and in this Indenture.

 

(2)           The
delivery of a Security for which a Fundamental Change Purchase Notice has been
timely delivered to any Paying Agent and not validly withdrawn prior to, on or
after the Fundamental Change Purchase Date (together with all necessary
endorsements) at the office of such Paying Agent shall be a condition to the
receipt by the Holder of the Fundamental Change Purchase Price therefor.

 

(3)           The
Company shall only be obliged to purchase, pursuant to this Section 3.08,
a portion of a Security if the principal amount of such portion is $1,000 or an
integral multiple thereof.  Provisions of
this Indenture that apply to the purchase of all of a Security also apply to
the purchase of such portion of such Security.

 

(4)           Notwithstanding
anything herein to the contrary, any Holder delivering to a Paying Agent the
Fundamental Change Purchase Notice contemplated by this Section 3.08(c) shall
have the right to withdraw such Fundamental Change Purchase Notice in whole or
in a portion thereof that is a principal amount of $1,000 or in an integral multiple
thereof at any time prior to the close of business on the Business Day prior to
the Fundamental Change Purchase Date by delivery of a written notice of
withdrawal to the Paying Agent in accordance with Section 3.09(b).

 

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

 

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

 

(7)           There
shall be no repurchase of any Securities pursuant to this Section 3.08 if
an Event of Default (other than a default in the payment of the Fundamental
Change Purchase Price) has occurred prior to, on or after, as the case may, the
giving by the Holders of such Securities of the required Fundamental Change
Purchase Notice and such Event of Default is continuing.  The Paying Agent will promptly return to the
respective Holders thereof any Securities (x) with respect to which a
Fundamental Change Purchase Notice has been withdrawn in compliance with this
Indenture, or (y) held by it during the continuance of an Event of Default
(other than a default in the payment of the Fundamental Change Purchase Price)
in which case, upon such return, the Fundamental Change Purchase Notice with
respect thereto shall be deemed to have been withdrawn.

 

27

 

Section 3.09.          Effect of Fundamental Change
Purchase Notice.

 

(a)           Upon receipt by any Paying Agent of a Fundamental Change
Purchase Notice, the Holder of the Security in respect of which such
Fundamental Change Purchase Notice was given shall (unless such Fundamental
Change Purchase Notice is withdrawn as specified below) thereafter be entitled
to receive the Fundamental Change Purchase Price with respect to such
Security.  The Fundamental Change
Purchase Price shall be paid to such Holder promptly following the later of (i) the
Fundamental Change Purchase Date with respect to such Security (provided such
Holder has satisfied the conditions in Section 3.08) and (ii) the
time of delivery of such Security to a Paying Agent by the Holder thereof in
the manner required by Section 3.08. 
A Security in respect of which a Fundamental Change Purchase Notice has
been given by the Holder thereof may not be converted pursuant to Article 4
hereof on or after the date of the delivery of such Fundamental Change Purchase
Notice, unless either (i) such Fundamental Change Purchase Notice has
first been validly withdrawn in accordance with Section 3.09(b); or (ii) there
shall be a default in the payment of the Fundamental Change Purchase Price, provided, that the conversion right with respect to such
Security shall terminate at the close of business on the date such default is
cured and such Security is purchased in accordance herewith.

 

(b)           A Fundamental Change Purchase Notice may be withdrawn by
any Holder delivering such Fundamental Change Purchase Notice, as the case may
be, upon delivery of a written notice of withdrawal (which may be delivered by
mail, overnight courier, hand delivery, facsimile transmission or in any other
written form and, in the case of Global Securities, may be delivered
electronically or by other means in accordance with the Applicable Procedures)
to and actually received by Paying Agent at any time prior to the close of
business on the Business Day immediately preceding the Fundamental Change
Purchase Date, specifying:

 

(i)            if
Certificated Securities are to be withdrawn, the certificate numbers of the
Securities in respect of which such notice of withdrawal is being submitted
(or, if the Security is held in global form, any other items required to comply
with the Applicable Procedures);

 

(ii)           the
principal amount of the Securities in respect of which such notice of
withdrawal is being submitted, which principal amount must be $1,000 or an
integral multiple thereof; and

 

(iii)          the
principal amount, if any, of the Securities that remains subject to the
original Fundamental Change Purchase Notice, as the case may be, and that has
been or shall be delivered for purchase by the Company which principal amount
must be $1,000 or an integral multiple thereof.

 

The Paying Agent will promptly return to the
respective Holders thereof any Certificated Securities with respect to which a
Fundamental Change Purchase Notice has been withdrawn in compliance with the
provisions of this Section 3.09(b).

 

Section 3.10.          Deposit of Fundamental Change
Purchase Price.

 

Prior to 10:00 a.m.,
New York City time, on a Fundamental Change Purchase Date, the Company shall
deposit with the Paying Agent (or if the Company or an Affiliate of the Company

 

28

 

is acting as the Paying Agent, shall segregate and hold in trust as
provided in Section 2.04) an amount in cash (in immediately available
funds) sufficient to pay the aggregate Fundamental Change Purchase Price of all
the Securities or portions thereof that are to be purchased on that Fundamental
Change Purchase Date.

 

If
a Paying Agent holds, in accordance with the terms hereof, at 10:00 a.m.,
New York City time, on a Fundamental Change Purchase Date, cash sufficient to
pay the aggregate Fundamental Change Purchase Price of all Securities for which
a Fundamental Change Purchase Notice has been delivered and not validly
withdrawn in accordance with this Indenture, then, on and after such
Fundamental Change Purchase Date, such Securities shall cease to be outstanding
and interest (including Special Interest), if any, on such Securities shall
cease to accrue, whether or not such Securities are delivered to the Paying
Agent, and the rights of the Holders in respect thereof shall terminate (other
than the right to receive the Fundamental Change Purchase Price, as applicable,
upon delivery of such Securities by their Holders to the Paying Agent).

 

Section 3.11.          Securities
Purchased in Part.

 

Any
Certificated Security that is to be purchased only in part shall be surrendered
at the office of a Paying Agent (with, if the Company or the Trustee so
requires, due endorsement by, or a written instrument of transfer in form
reasonably satisfactory to the Company and the Trustee duly executed by, the Holder
thereof or such Holder’s attorney duly authorized in writing), and promptly
after a Fundamental Change Purchase Date, the Company shall issue and the
Trustee shall, upon receipt of a Company Order (which the Company agrees to
deliver promptly), authenticate and deliver to the Holder of such Security,
without service charge, a new Security or Securities, of such authorized
denomination or denominations as may be requested by such Holder, in aggregate
principal amount equal to, and in exchange for, the portion of the principal
amount of the Security so surrendered that is not purchased by the Company on
such Fundamental Change Purchase Date.

 

Section 3.12.          Repayment
to the Company.

 

To
the extent that the aggregate amount of cash deposited by the Company pursuant
to Section 3.10 exceeds the aggregate Fundamental Change Purchase Price of
the Securities or portions thereof that the Company is obligated to purchase on
the Fundamental Change Purchase Date, then promptly after the Fundamental
Change Purchase Date, the Paying Agent shall return any such excess cash to the
Company.

 

Section 3.13.          Compliance With Securities Laws
Upon Purchase of Securities.

 

When
complying with the provisions of Article 3 hereof and subject to any
exemptions available under applicable law, the Company shall:

 

(a)           comply with the provisions of any
tender offer rules under the Exchange Act that may then be applicable to
the Company’s purchase of Securities under Article 3;

 

(b)           file a Schedule TO (or any successor
or similar schedule, form or report) if required under the Exchange Act; and

 

29

 

(c)           otherwise comply
with all federal and state securities laws so as to permit the rights and
obligations in connection with any purchase pursuant to this Article 3 to
be exercised in the time and in the manner specified herein.

 

To the extent that
compliance with any such laws, rules and regulations would result in a
conflict with any of the terms hereof, this Indenture is hereby modified to the
extent required for the Company to comply with such laws, rules and
regulations.

 

Section 3.14.          Purchase of Securities In Open
Market.

 

The Company may purchase
Securities in the open market or by tender at any price or pursuant to private
agreements.  The Company shall surrender
any Security purchased by the Company pursuant to this Article 3 to the
Trustee for cancellation.  Any Securities
surrendered to the Trustee for cancellation may not be reissued or resold by
the Company and will be canceled promptly in accordance with Section 2.12.

 

ARTICLE 4

 

CONVERSION

 

Section 4.01.          Right to Convert.  (a)  Subject to and upon
compliance with the provisions of this Indenture, each Holder of Securities
shall have the right, at such Holder’s option, to convert the principal amount
of any such Securities, or any portion of such principal amount equal to $1,000
or a multiple of $1,000 thereof, at the Conversion Rate in effect on the
Conversion Date for such Securities, at any time prior to the close of business
on the second Scheduled Trading Day immediately preceding the Final Maturity
Date.

 

(b)           Securities may not be converted after the close of
business on the second Scheduled Trading Day immediately preceding the Final
Maturity Date.

 

Section 4.02.          Conversion Procedures.  (a)  Each Security shall be convertible
at the office of the Conversion Agent and, if applicable, in accordance with
the procedures of the Depositary.

 

(b)           In order to exercise the conversion privilege with respect
to any interest in a Global Security, the Holder must complete the appropriate
instruction form for conversion pursuant to the Depositary’s book-entry
conversion program, furnish appropriate endorsements and transfer documents if
required by the Company or the Conversion Agent, and pay the funds, if any,
required by Section 4.03(c) and any taxes or duties if required
pursuant to Section 4.08, and the Conversion Agent must be informed of the
conversion in accordance with the customary practice of the Depositary. In
order to exercise the conversion privilege with respect to any Certificated
Securities, the Holder of any such Securities to be converted, in whole or in
part, shall:

 

(i)            complete
and manually sign the conversion notice provided on the back of the Security
(the “Conversion Notice”) or a facsimile of the Conversion Notice;

 

30

 

(ii)           deliver
the Conversion Notice, which is irrevocable, and the Security to the Conversion
Agent;

 

(iii)          if
required, furnish appropriate endorsements and transfer documents,

 

(iv)          make
any payment required under Section 4.03(c); and

 

(v)           if
required, pay all transfer or similar taxes as set forth in Section 4.08.

 

The date on which the Holder
satisfies all of the applicable requirements set forth above is the “Conversion
Date.” The Conversion Agent will, as promptly as possible, and in any event
within two (2) Business Days of the receipt thereof, provide the Company
with notice of any conversion by a Holder of the Securities.

 

(c)           Each Conversion Notice shall state the name or names (with
address or addresses) in which any certificate or certificates for shares of
Common Stock which shall be issuable on such conversion shall be issued. All
such Securities surrendered for conversion shall, unless the shares issuable on
conversion are to be issued in the same name as the registration of such
Securities, be duly endorsed by, or be accompanied by instruments of transfer
in form satisfactory to the Company duly executed by, the Holder or his duly
authorized attorney.

 

(d)           In case any Securities of a denomination greater than
$1,000 shall be surrendered for partial conversion, the Company shall execute
and the Trustee shall authenticate and deliver to the Holder of the Securities
so surrendered, without charge, new Securities in authorized denominations in
an aggregate principal amount equal to the unconverted portion of the
surrendered Securities.

 

Each conversion shall be
deemed to have been effected as to any such Securities (or portion thereof)
surrendered for conversion on the relevant Conversion Date.  The person in whose name the certificate or
certificates for the number of shares of Common Stock that shall be issuable
upon such conversion shall become the holder of record of such shares of Common
Stock as of the close of business on such Conversion Date. Notwithstanding the
foregoing and anything contained in this Indenture to the contrary, in no event
shall a Holder be entitled to the benefit of a Conversion Rate adjustment
pursuant to the provisions of Section 4.04 in respect of Securities
surrendered for conversion if, by virtue of being deemed the record holder of
the shares of Common Stock issuable upon such conversion pursuant to the
foregoing sentence, such Holder participates, as a result of being such holder
of record, in the transaction or event that would otherwise give rise to such
Conversion Rate adjustment to the same extent and in the same manner as holders
of shares of Common Stock generally.

 

(e)           Upon the conversion of an interest in Global Securities,
the Trustee (or other Conversion Agent appointed by the Company) shall make a
notation on such Global Securities as to the reduction in the principal amount
represented thereby. The Company shall notify the Trustee in writing of any
conversions of Securities effected through any Conversion Agent other than the
Trustee.

 

(f)            Notwithstanding the foregoing, a Security in respect of
which a Holder has delivered a Fundamental Change Purchase Notice exercising
such Holder’s option to require the 

 

31

 

Company to purchase such
Security may be converted only if such notice of exercise is withdrawn in
accordance with Article 3 hereof prior to the close of business on the
Business Day prior to the relevant Fundamental Change Purchase Date.

 

Section 4.03.          Payments Upon Conversion.  (a) Upon any conversion of any
Securities, on the third Business Day immediately following the Conversion
Date, the Company shall deliver to the converting Holder a number of shares of
Common Stock equal to (i) the aggregate principal amount of such
Securities to be converted divided by $1,000, multiplied by (ii) the
Conversion Rate in effect as of such Conversion Date, together with any cash
payment for any fractional share of Common Stock as described in this Section 4.03.

 

(b)           Subject to Section 4.03(c) below, upon
conversion, Holders shall not receive any separate cash payment for accrued and
unpaid interest (including Special Interest), if any, unless such conversion
occurs between a Regular Record Date and the Interest Payment Date to which it
relates.

 

(c)           Upon the conversion of any Securities, the Holder will not
be entitled to receive any separate cash payment for accrued and unpaid
interest (including Special Interest), if any, except to the extent specified
below. The Company’s delivery to the Holder of Common Stock together with any
cash payment for any fractional share of Common Stock, into which a Security is
convertible will be deemed to satisfy in full the Company’s obligation to pay
the principal amount of the Securities so converted and accrued and unpaid
interest (including Special Interest), if any, to, but not including, the
Conversion Date. As a result, accrued and unpaid interest (including Special
Interest), if any, to, but not including, the Conversion Date will be deemed to
be paid in full rather than cancelled, extinguished or forfeited.
Notwithstanding the foregoing, if Securities are converted after the close of
business on a Regular Record Date for the payment of interest, Holders of such
Securities at the close of business on such Regular Record Date will receive
the interest (including Special Interest), if any, payable on such Securities
on the corresponding Interest Payment Date notwithstanding the conversion. Securities
surrendered for conversion during the period from the close of business on any
Regular Record Date to the open of business on the immediately following
Interest Payment Date must be accompanied by funds equal to the amount of
interest (including Special Interest), if any, payable on the Securities so
converted on such following Interest Payment Date; provided that no such
payment need be made (i) if the Company has called the Securities for
redemption on a Redemption Date that falls after a Regular Record Date for an
Interest Payment Date and on or prior to the related Interest Payment Date, (ii) for
conversions following the Regular Record Date immediately preceding the Final
Maturity Date, (iii) if the Company has specified a Fundamental Change
Purchase Date that is after a Regular Record Date and on or prior to the
corresponding Interest Payment Date, or (iv) to the extent of any overdue
interest, if any overdue interest exists at the time of conversion with respect
to such Security.

 

(d)           The Company shall not issue fractional shares of Common
Stock upon conversion of Securities. If multiple Securities shall be
surrendered for conversion at one time by the same Holder, the number of full
shares which shall be issuable upon conversion shall be computed on the basis
of the aggregate principal amount of the Securities (or specified portions
thereof to the extent permitted hereby) so surrendered. If any fractional share
of Common Stock would be issuable upon the conversion of any Securities, the
Company shall make payment 

 

32

 

therefor in cash in lieu of
fractional shares of Common Stock based on the Last Reported Sale Price on the
relevant Conversion Date.

 

Section 4.04.          Adjustment of Conversion Rate.  The Conversion Rate shall be adjusted from
time to time by the Company if any of the following events occurs, except that
the Company will not make any adjustment to the Conversion Rate if Holders of
Securities participate, as a result of holding the Securities, in any of the
transactions described under Section 4.04(a) (but only with respect
to stock dividends or distributions), Section 4.04(b), Section 4.04(c),
and Section 4.04(d), at the same time as holders of the Common Stock
participate, without having to convert their Securities, as if such Holders
held a number of shares of Common Stock equal to the Conversion Rate in effect
for such Securities immediately prior to the Ex-Dividend Date for such event.

 

(a)           If the Company, at any time or from time to time while any
of the Securities are outstanding, exclusively issues shares of its Common
Stock as a dividend or distribution on shares of Common Stock, or if the
Company effects a share split or share combination, then the Conversion Rate
will be adjusted based on the following formula:

 

	
   

  	
   

  	
  CR1

  	
  =

  	
  CR0

  	
  x

  	
   

  	
  OS1

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  OS0

  	
   

  

 

where,

 

	
  CR0

  	
  =

  	
  the Conversion Rate in
  effect immediately prior to the open of business on the Ex-Dividend Date of
  such dividend or distribution, or immediately prior to the open of business
  on the effective date of such share split or share combination, as
  applicable;

  
	
   

  	
   

  	
   

  
	
  CR1

  	
  =

  	
  the Conversion Rate in
  effect immediately after the open of business on such Ex-Dividend Date or
  such effective date;

  
	
   

  	
   

  	
   

  
	
  OS0

  	
  =

  	
  the number of shares of
  Common Stock outstanding immediately prior to the open of business on such
  Ex-Dividend Date or such effective date; and

  
	
   

  	
   

  	
   

  
	
  OS1

  	
  =

  	
  the number of shares of
  Common Stock outstanding immediately after giving effect to such dividend,
  distribution, share split or share combination.

  

 

Such adjustment shall become
effective immediately after the open of business on the Ex-Dividend Date for
such dividend or distribution or the effective date for such share split or
share combination. If any dividend or distribution of the type described in
this Section 4.04(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)           If the Company, at any time or from time to time while any
of the Securities are outstanding, issues to all or substantially all holders
of the Common Stock any rights or warrants entitling them for a period of not
more than 60 calendar days after the announcement date of such issuance to
subscribe for or purchase shares of the Common Stock at a price per share less
than the average of the Last Reported Sale Prices of Common Stock for the 10
consecutive 

 

33

 

Trading-Day period ending on the Trading Day
immediately preceding the date of announcement of such issuance, the Conversion
Rate shall be adjusted based on the following formula:

 

	
   

  	
   

  	
  CR1

  	
  =

  	
  CR0

  	
  x

  	
   

  	
   OS0 + X

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   OS0 + Y

  	
   

  

 

where,

 

	
  CR0

  	
  =

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

  
	
   

  	
   

  	
   

  
	
  CR1

  	
  =

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

  
	
   

  	
   

  	
   

  
	
  OS0

  	
  =

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

  
	
   

  	
   

  	
   

  
	
  X

  	
  =

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

  
	
   

  	
   

  	
   

  
	
  Y

  	
  =

  	
  the number of shares of
  Common Stock equal to the aggregate price payable to exercise such rights or
  warrants divided by the average of the Last
  Reported Sale Prices of the Common Stock over the 10 consecutive Trading Day
  period ending on the Trading Day immediately preceding the date of
  announcement of the issuance of such rights or warrants.

  

 

To the extent such rights or
warrants are not exercised prior to their expiration or termination, the
Conversion Rate shall be readjusted to the Conversion Rate which would 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 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 the date fixed for the determination of
shareholders entitled to receive such rights or warrants had not been fixed.
For the purposes of this Section 4.04(b), in determining whether any
rights or warrants entitle the holders to subscribe for or purchase shares of
Common Stock at less than the average of the Last Reported Sale Prices of
Common Stock for the 10 consecutive Trading Day period ending on the Trading
Day immediately preceding the date of announcement of such issuance, and in
determining the aggregate exercise price payable for such shares of Common
Stock, there shall be taken into account any consideration received by the
Company for such rights or warrants and any amount payable on the exercise
thereof, with the value of such consideration, if other than cash, as shall be
determined in good faith by the Board of Directors.

 

(c)           If the Company, at any time or from time to time while the
Securities are outstanding, distributes shares of any class of capital stock of
the Company, evidences of its indebtedness, other assets or property of the
Company or rights or warrants to acquire the 

 

34

 

Company’s capital stock or other securities to all or substantially all
holders of its Common Stock, excluding:

 

(i)            dividends
or distributions and rights or warrants as to which an adjustment was effected
pursuant to Section 4.04(a) or Section 4.04(b);

 

(ii)           dividends
or distributions paid exclusively in cash; and

 

(iii)          Spin-Offs
to which the provisions set forth below in this Section 4.04(c) shall
apply;

 

then the Conversion Rate
shall be adjusted based on the following formula:

 

	
   

  	
   

  	
  CR1

  	
  =

  	
  CR0

  	
  x

  	
   

  	
  SP0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  SP0 - FMV

  	
   

  

 

where,

 

	
  CR0

  	
  =

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

  
	
   

  	
   

  	
   

  
	
  CR1

  	
  =

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

  
	
   

  	
   

  	
   

  
	
  SP0

  	
  =

  	
  the average of the Last
  Reported Sale Prices of the Common Stock over the 10 consecutive Trading
  Day period ending on the Trading Day immediately preceding the Ex-Dividend
  Date for such distribution; and

  
	
   

  	
   

  	
   

  
	
  FMV

  	
  =

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

  

 

Such adjustment shall become
effective immediately after the open of business on the Ex-Dividend Date for
such distribution. If the Board of Directors determines the “FMV” (as defined
above) of any distribution for purposes of this Section 4.04(c) by
reference to the actual or when issued trading market for any securities, it
must in doing so consider the prices in such market over the same period used
in computing the average of the Last Reported Sale Prices of the Common Stock.
Notwithstanding the foregoing, if “FMV” (as defined above) is equal to or
greater than “SP0” (as defined
above), in lieu of the foregoing adjustment, each Holder of Securities shall
receive, at the same time and upon the same terms as holders of the Common
Stock, the amount and kind of securities and assets such Holder would have
received as if such Holder owned a number of shares of Common Stock equal to
the Conversion Rate in effect on the Ex-Dividend Date for the distribution of
the securities or assets.

 

With respect to an
adjustment pursuant to this Section 4.04(c) where there has been a
payment of a dividend or other distribution on the Common Stock of shares of
capital stock of any class or series, or similar equity interest, of or
relating to a Subsidiary or other business unit 

 

35

 

and such shares of capital
stock or similar equity interests are listed for trading on a securities
exchange (a “Spin-Off”), the Conversion Rate shall be increased based on
the following formula:

 

	
   

  	
   

  	
  CR1

  	
  =

  	
  CR0

  	
  x

  	
   

  	
  FMV0 + MP0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  MP0

  	
   

  

 

where,

 

	
  CR0

  	
  =

  	
  the Conversion Rate in
  effect immediately prior to the end of the Valuation Period (as defined
  below);

  
	
   

  	
   

  	
   

  
	
  CR1

  	
  =

  	
  the Conversion Rate in
  effect immediately after the end of the Valuation Period;

  
	
   

  	
   

  	
   

  
	
  FMV0

  	
  =

  	
  the average of the Last
  Reported Sale Prices of the capital stock or similar equity interest
  distributed to holders of Common Stock applicable to one share of Common
  Stock (determined for purposes of the definition of Last Reported Sale Price
  as if such capital stock or similar equity interest were the Common Stock)
  over the first ten consecutive Trading Day period after, and including, the
  Ex-Dividend Date of the Spin-Off (the “Valuation Period”); and

  
	
   

  	
   

  	
   

  
	
  MP0

  	
  =

  	
  the average of the Last
  Reported Sale Prices of Common Stock over the Valuation Period.

  

 

The adjustment to the
Conversion Rate under the preceding paragraph will occur on the last day of the
Valuation Period; provided that in respect of any conversion during the
Valuation Period, references above to 10 Trading Days shall be deemed replaced
with such lesser number of Trading Days as have elapsed between the Ex-Dividend
Date of such Spin-Off and the Conversion Date in determining the applicable
Conversion Rate.

 

For the purposes of this Section 4.04(c) (and
subject in all respects to Section 4.11), rights or warrants distributed
by the Company to all holders of its Common Stock entitling them 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 (a “Trigger Event”): (1) are deemed to
be transferred with such shares of Common Stock; (2) are not exercisable;
and (3) are also issued in respect of future issuances of Common Stock,
shall be deemed not to have been distributed for purposes of this Section 4.04(c),
(and no adjustment to the Conversion Rate under this Section 4.04(c) will
be required) until the occurrence of the earliest Trigger Event, whereupon such
rights and warrants shall be deemed to have been distributed and an appropriate
adjustment (if any is required) to the Conversion Rate shall be made under this
Section 4.04(c). If any such right or warrant, including any such existing
rights or warrants distributed prior to the date of this Indenture, are subject
to events, upon the occurrence of which such rights or warrants become
exercisable to purchase different securities, evidences of indebtedness or
other assets, then the date of the occurrence of any and each such event shall
be deemed to be the date of distribution and Ex-Dividend Date of such deemed
distribution (in which case the original rights or warrants shall be deemed to
terminate and expire on such date without exercise by any of the holders). In
addition, in the event of any distribution or deemed distribution of rights or
warrants, or any Trigger Event or other event (of 

 

36

 

the type described in the
preceding sentence) with respect thereto that was counted for purposes of
calculating a distribution amount for which an adjustment to the Conversion
Rate under this Section 4.04(c) was made, (1) in the case of any
such rights or warrants which shall all have been redeemed or purchased without
exercise by any Holders thereof, upon such final redemption or repurchase (x) the
Conversion Rate shall be readjusted as if such rights or warrants had not been
issued and (y) the Conversion Rate shall then again be readjusted to give
effect to such distribution, deemed distribution or Trigger Event, as the case
may be, as though it were a cash distribution, equal to the per share
redemption or purchase price received by holders of Common Stock with respect
to such rights or warrants (assuming each such holder had retained such rights
or warrants), made to all holders of Common Stock as of the date of such
redemption or purchase, and (2) in the case of such rights or warrants
which shall have expired or been terminated without exercise by any holders
thereof, the Conversion Rate shall be readjusted as if such rights and warrants
had not been issued.

 

For the purposes of this Section 4.04(c) and
subsections (a) and (b) of this Section 4.04, any dividend or
distribution to which this Section 4.04(c) applies which also
includes one or both of:

 

(A)                              a dividend or distribution
of shares of Common Stock to which Section 4.04(a) applies (the “Clause
A Distribution”), and

 

(B)                                a dividend or
distribution of rights or warrants to which Section 4.04(b) applies
(the “Clause B Distribution”),

 

then (1) such dividend
or distribution, other than the Clause A Distribution and the Clause B Distribution,
shall be deemed to be a dividend or distribution to which this Section 4.04(c) applies
(the “Clause C Distribution”) and any Conversion Rate adjustment
required by this Section 4.04(c) with respect thereto shall then be
made, and (2) the Clause A Distribution and Clause B Distribution shall be
deemed to immediately follow the Clause C Distribution and any Conversion Rate
adjustment required by Section 4.04(a) and Section 4.04(b) with
respect thereto shall then be made, except that, if determined by the Company, (I) the
“Ex-Dividend Date” of the Clause A Distribution and the Clause B Distribution
shall be deemed to be the Ex-Dividend Date of the Clause C Distribution and (II) any
shares of Common Stock included in the Clause A Distribution or Clause B
Distribution shall be deemed not to be “outstanding immediately prior to the
open of business on such Ex-Dividend Date or such effective date” within the
meaning of Section 4.04(a) or “outstanding immediately prior to the
open of business on such Ex-Dividend Date” within the meaning of Section 4.04(b).

 

(d)           If the Company pays any cash dividends or distributions to
all or substantially all holders of Common Stock, other than a regular,
quarterly cash dividend that does not exceed $0.075 per share (the “Dividend
Threshold Amount”), the Conversion Rate shall be adjusted based on the
following formula:

 

	
   

  	
   

  	
  CR1

  	
  =

  	
  CR0

  	
  x

  	
   

  	
  SP0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  SP0 – C

  	
   

  

 

37

 

where,

 

	
  CR0

  	
  =

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

  
	
   

  	
   

  	
   

  
	
  CR1

  	
  =

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

  
	
   

  	
   

  	
   

  
	
  SP0

  	
  =

  	
  the Last Reported Sale Price
  of the Common Stock on the Trading Day immediately preceding the Ex-Dividend
  Date for such dividend or distribution; and

  
	
   

  	
   

  	
   

  
	
  C

  	
  =

  	
  the amount in cash per
  share the Company distributes to holders of Common Stock in excess of the
  Dividend Threshold Amount.

  

 

provided that if the
dividend or distribution is not a regular quarterly cash dividend, the Dividend
Threshold Amount will be deemed to be zero. The Dividend Threshold Amount is
subject to adjustment in a manner inversely proportional to adjustments to the
Conversion Rate; provided that no adjustment will
be made to the Dividend Threshold Amount for any adjustment to the Conversion
Rate under this Section 4.04(d).

 

In the case of an adjustment
pursuant to this Section 4.04(d), such adjustment shall become effective
immediately after the open of business on the Ex-Dividend Date for the relevant
dividend or distribution. If the portion of the cash so distributed applicable
to one share of the Common Stock is equal to or greater than the Last Reported
Sale Price of a share of Common Stock on the Trading Day immediately preceding
the Ex-Dividend Date for such dividend or distribution, in lieu of the
adjustment set forth above, adequate provision shall be made so that each
Holder of Securities shall have the right to receive on the date on which such
cash dividend or distribution is distributed to holders of Common Stock, for
each $1,000 principal amount of Securities, the amount of cash such Holder
would have received had such Holder owned a number of shares of Common Stock
equal to the Conversion Rate in effect immediately prior to the Ex-Dividend
Date for such distribution.

 

(e)           If the Company or any of its Subsidiaries makes a payment
in respect of a tender offer or exchange offer for Common Stock, to the extent
that the cash and value of any other consideration included in the payment per
share of Common Stock exceeds the Last Reported Sale Price per share of Common
Stock on the Trading Day next succeeding the last date on which tenders or
exchanges may be made pursuant to such tender or exchange offer, the Conversion
Rate shall be increased based on the following formula:

 

	
   

  	
   

  	
  CR1

  	
  =

  	
  CR0

  	
  x

  	
   

  	
  AC + (SP1 x OS1)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  OS0 x SP1

  	
   

  

 

where,

 

	
  CR0

  	
  =

  	
  the Conversion Rate in
  effect immediately prior to the close of business on the 10th Trading Day
  immediately following, and including, the Trading Day next succeeding the
  date such tender or exchange offer expires;

  

 

38

 

	
  CR1

  	
  =

  	
  the Conversion Rate in
  effect immediately after the close of business on the 10th Trading Day
  immediately following, and including, the Trading Day next succeeding the
  date such tender or exchange offer expires;

  
	
   

  	
   

  	
   

  
	
  AC

  	
  =

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

  
	
   

  	
   

  	
   

  
	
  OS0

  	
  =

  	
  the number of shares of
  Common Stock outstanding immediately prior to the date such tender or
  exchange offer expires;

  
	
   

  	
   

  	
   

  
	
  OS1

  	
  =

  	
  the number of shares of Common
  Stock outstanding immediately after the date such tender or exchange offer
  expires (after giving effect to, for the avoidance of doubt, the purchase of
  all shares accepted for purchase or exchange in such tender or exchange
  offer); and

  
	
   

  	
   

  	
   

  
	
  SP1

  	
  =

  	
  the average of the Last
  Reported Sale Prices of the Common Stock over the 10 consecutive Trading Day
  period commencing on the Trading Day next succeeding the date such tender or
  exchange offer expires.

  

 

The adjustment to the
Conversion Rate under this Section 4.04(e) shall occur as of the
close of business on the tenth Trading Day from, and including, the Trading Day
next succeeding the date such tender or exchange offer expires; provided that
in respect of any conversion within 10 Trading Days immediately following, and
including, the expiration date of any tender or exchange offer, references with
respect to 10 Trading Days shall be deemed replaced with such lesser number of
Trading Days as have elapsed between the expiration date of such tender or
exchange offer and the Conversion Date in determining the applicable Conversion
Rate.

 

(f)            The Company from time to time may increase the Conversion
Rate by any amount for any period of time of at least 20 Business Days, so long
as the increase is irrevocable during the period and the Board of Directors
shall have made a determination that such increase would be in the best
interests of the Company, which determination shall be conclusive. Whenever the
Conversion Rate is increased pursuant to this Section 4.04(f), the Company
shall mail to Holders of record of the Securities a notice of the increase at
least one day 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.

 

(g)           The Company may (but shall not be required to) increase
the Conversion Rate, in addition to any adjustments pursuant to Section 4.04(a),
4.04(b), 4.04(c), 4.04(d), 4.04(e) or 4.04(f), if the Board of Directors
considers such increase to be advisable to avoid or diminish any income tax to
holders of Common Stock or rights to purchase Common Stock in connection with a
dividend or distribution of shares (or rights to acquire shares) or similar
event.

 

(h)           All calculations under this Article 4 shall be made
by the Company and shall be made to the nearest one ten-thousandth of a share.
No adjustment shall be required to be made for the Company’s issuance of Common
Stock or any securities convertible into or exchangeable for shares of Common Stock
or rights to purchase shares of Common Stock or such convertible or
exchangeable securities, other than as provided in this Section 4.04 and
in Section 4.11 hereof.

 

39

 

(i)            Whenever the Conversion Rate is adjusted as herein
provided, the Company shall promptly file with the Trustee and any Conversion
Agent an Officer’s Certificate setting forth the Conversion Rate after such
adjustment and setting forth a brief statement of the facts requiring such
adjustment. Unless and until a Trust Officer of the Trustee shall have received
such Officer’s Certificate, the Trustee shall not be deemed to have knowledge
of any adjustment of the Conversion Rate and may assume without inquiry that
the last Conversion Rate of which it has knowledge is still in effect. Promptly
after delivery of such certificate, the Company shall prepare a notice of such
adjustment of the Conversion Rate setting forth the adjusted Conversion Rate
and the date on which each adjustment becomes effective and shall mail such
notice of such adjustment of the Conversion Rate to each Holder of the
Securities. Failure to deliver such notice shall not affect the legality or
validity of any such adjustment.

 

(j)            For purposes of this Section 4.04, the number of
shares of Common Stock at any time outstanding shall not include shares held in
the treasury of the Company so long as the Company does not pay any dividend or
make any distribution on shares of Common Stock 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.

 

(k)           Notwithstanding the foregoing, if the application of the
foregoing formulas set forth in this Section 4.04 would result in a
decrease in the Conversion Rate, no adjustment to the Conversion Rate shall be
made (other than as a result of a share combination).

 

(l)            Notwithstanding anything to the contrary in this Article 4,
no adjustment to the Conversion Rate shall be made:

 

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

 

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

 

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

 

(iv)          for
a change in the par value of the Common Stock; or

 

(v)           for
accrued and unpaid interest (including Special Interest), if any, on the
Securities.

 

(m)          The Company shall not be required to make an adjustment in
the Conversion Rate unless the adjustment would require a change of at least 1%
in the Conversion Rate. However, when making payment of the Conversion Price
the Company will carry forward any adjustments that are less than 1% of the
Conversion Rate and make such carried forward adjustment, 

 

40

 

regardless of whether the aggregate
adjustment is less than 1%, upon any Conversion Date with respect to the
Securities.

 

Section 4.05.          Certain Other Adjustments.  To the extent not otherwise covered by Section 4.04,
whenever a provision of this Indenture requires the calculation of Last
Reported Sale Prices over a span of multiple days, the Board of Directors will
make appropriate adjustments to such Last Reported Sale Prices and the
Conversion Rate or the amount due upon conversion to account for any adjustment
to the Conversion Rate that becomes effective, or any event requiring an
adjustment to the Conversion Rate where the Ex-Dividend Date of the event
occurs, at any time during the period from which such Last Reported Sale Prices
are to be calculated.  Any such
adjustment in accordance with the provisions of this Section 4.05 shall be
determined in good faith by the Board of Directors in order to give effect to
the intent of Section 4.04 and the other provisions of this Article 4
and to avoid unjust or inequitable results.

 

Section 4.06.          Adjustments Upon Certain
Fundamental Changes.  (a) If a
Make-Whole Fundamental Change occurs and a Holder elects to convert its
Securities in connection with such Make-Whole Fundamental Change, the Company
shall, under certain circumstances, increase the Conversion Rate for the
Securities so surrendered for conversion by a number of additional shares of
Common Stock (the “Additional Shares”) as described below. A conversion
of Securities shall be deemed for these purposes to be “in connection with”
such Make-Whole Fundamental Change if the notice of conversion of the
Securities is received by the Conversion Agent from, and including, the Effective
Date of the Make-Whole Fundamental Change up to, and including, the Business
Day immediately prior to the related Fundamental Change Purchase Date (or, in
the case of an event that would have been a Fundamental Change but for the
proviso in clause (2) of the definition thereof, the 35th calendar
day immediately following the Effective Date of such Make-Whole Fundamental
Change).

 

(b)           Upon surrender of Securities for conversion in connection
with a Make-Whole Fundamental Change, the Company shall deliver shares of
Common Stock as provided under Section 4.03, calculated based on the
Conversion Rate as adjusted by the Additional Shares; provided, however, that
if, at the effective time of a Make-Whole Fundamental Change, the Reference
Property is comprised entirely of cash, then, for any conversion of Securities
following the Effective Date of such Make-Whole Fundamental Change, the amounts
deliverable by the Company shall be calculated based solely on the “Stock
Price” (as defined below) for the Make-Whole Fundamental Change and shall
be deemed to be an amount equal to the Conversion Rate (including any
adjustment for Additional Shares) multiplied by such Stock Price. In such
event, the amounts deliverable by the Company shall be determined and paid to
holders in cash on the third Business Day following the Conversion Date.

 

(c)           The number of Additional Shares, if any, by which the
Conversion Rate will be increased will be determined by reference to the table
below, based on the date on which the Make-Whole Fundamental Change occurs or
becomes effective (the “Effective Date”) and the price (the “Stock
Price”) paid (or deemed paid) per share of the Common Stock in the
Fundamental Change.  If the holders of
the Common Stock receive only cash in a Make-Whole Fundamental Change described
in clause (2) of the definition of Fundamental Change, the Stock
Price shall be the cash amount paid per share. 
Otherwise, the Stock Price shall be the average of the Last Reported
Sale Prices of the Common Stock over the ten Trading-Day period ending on, 

 

41

 

and including, the Trading
Day immediately preceding the Effective Date of the Make-Whole Fundamental
Change.

 

The following
table sets forth the number of additional shares to be received per $1,000
principal amount of notes for each stock price and effective date set forth
below:

 

	
   

  	
   

  	
  Stock
  Price

  	
   

  
	
  Effective Date

  	
   

  	
  $13.50

  	
   

  	
  $15.00

  	
   

  	
  $17.50

  	
   

  	
  $20.00

  	
   

  	
  $25.00

  	
   

  	
  $30.00

  	
   

  	
  $40.00

  	
   

  	
  $50.00

  	
   

  	
  $60.00

  	
   

  	
  $70.00

  	
   

  
	
  June 9, 2009

  	
   

  	
  17.0940

  	
   

  	
  13.5499

  	
   

  	
  9.5775

  	
   

  	
  7.0867

  	
   

  	
  4.3210

  	
   

  	
  3.0081

  	
   

  	
  1.8421

  	
   

  	
  1.3332

  	
   

  	
  1.0315

  	
   

  	
  0.8262

  	
   

  
	
  June 15,
  2010

  	
   

  	
  17.0940

  	
   

  	
  13.3112

  	
   

  	
  8.9163

  	
   

  	
  6.2263

  	
   

  	
  3.4147

  	
   

  	
  2.2233

  	
   

  	
  1.3183

  	
   

  	
  0.9649

  	
   

  	
  0.7585

  	
   

  	
  0.6165

  	
   

  
	
  June 15,
  2011

  	
   

  	
  17.0940

  	
   

  	
  12.9105

  	
   

  	
  7.8854

  	
   

  	
  4.8800

  	
   

  	
  2.0297

  	
   

  	
  1.1119

  	
   

  	
  0.6240

  	
   

  	
  0.4588

  	
   

  	
  0.3563

  	
   

  	
  0.2840

  	
   

  
	
  June 15,
  2012

  	
   

  	
  17.0940

  	
   

  	
  12.6500

  	
   

  	
  6.8366

  	
   

  	
  2.9941

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  
	
  June 15,
  2013

  	
   

  	
  17.0940

  	
   

  	
  11.4308

  	
   

  	
  5.6208

  	
   

  	
  2.2719

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  
	
  June 15,
  2014

  	
   

  	
  17.0940

  	
   

  	
  9.6866

  	
   

  	
  0.1628

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  

 

The exact Stock Prices and
Effective Dates may not be set forth in the table above, in which case:

 

(i)            If
the Stock Price is between two Stock Prices in the table or the Effective Date
is between two Effective Dates in the table, the number of Additional Shares
shall be determined by a straight-line interpolation between the number of
Additional Shares set forth for the higher and lower Stock Prices and the
earlier and later Effective Dates, as applicable, based on a 365-day year.

 

(ii)           If
the Stock Price is greater than $70.00 per share (subject to adjustment in the
same manner as the Stock Prices set forth in the column headings of the table
in Schedule A pursuant to subsection (d) below), no Additional Shares
shall be added to the Conversion Rate.

 

(iii)          If
the Stock Price is less than $13.50 per share (subject to adjustments in the
same manner as the Stock Prices set forth in the column headings of the table
in Schedule A pursuant to subsection (d) below), no Additional Shares
shall be added to the Conversion Rate.

 

Notwithstanding the
foregoing, in no event shall the Conversion Rate exceed 74.0740 shares of
Common Stock per $1,000 principal amount of Securities, subject to adjustments
in the same manner as the Conversion Rate as set forth in Section 4.04.

 

(d)           The Stock Prices set forth in the column headings of the
table above shall be adjusted as of any date on which the Conversion Rate of
the Securities is otherwise adjusted. 
The adjusted Stock Prices shall equal the Stock Prices applicable
immediately prior to such adjustment, multiplied by a fraction, the numerator
of which is the Conversion Rate immediately prior to such adjustment giving
rise to the Stock Price adjustment and the denominator of which is the Conversion
Rate as so adjusted. The number of Additional Shares set forth in such table
shall be adjusted in the same manner as the Conversion Rate as set forth in Section 4.04.

 

(e)           The Company shall notify the Holders of Securities of the
Effective Date of any Make-Whole Fundamental Change and issue a press release
announcing such Effective Date no later than five Business Days after such
Effective Date.

 

42

 

Section 4.07.          Effect of Recapitalization,
Reclassification, Consolidation, Merger or Sale.

 

(a)           If any of the following events occur:

 

(i)            any
recapitalization or reclassification of, or change in, the Common Stock (other
than changes resulting from a subdivision or combination);

 

(ii)           a
consolidation, merger or combination involving the Company; or

 

(iii)          a
sale, lease or other transfer to a third party of all or substantially all of
the consolidated assets of the Company and its Subsidiaries; or

 

(iv)          any
statutory share exchange;

 

in each case as a result of
which the Common Stock would be converted into, or exchanged for, or would be
reclassified or changed into, stock, other securities, other property or assets
(including cash or any combination thereof) (any such event, a “Merger Event”),
then at the effective time of such Merger Event, the Company or the successor
or purchasing Person, as the case may be, shall execute with the Trustee a
supplemental indenture (which shall comply with the Trust Indenture Act as in
force at the date of execution of such supplemental indenture) providing that
at and after the effective time of such Merger Event, the right to convert a
Security will be changed into a right to convert such Security as set forth in
this Indenture into the kind and amount of shares of stock, other securities or
other property or assets (including cash or any combination thereof) that a
holder of a number of shares of Common Stock equal to the Conversation Rate
prior to such Merger Event would have owned or been entitled to receive (the “Reference
Property”) upon such Merger Event.

 

If, as a result of the
Merger Event, each share of Common Stock is converted into the right to receive
more than a single type of consideration (determined based in part upon any
form of stockholder election), then the Reference Property into which the
Securities will be convertible will be deemed to be the weighted average of the
types and amounts of consideration received by the holders of Common Stock that
affirmatively make such an election.

 

The Company shall not become
a party to any such Merger Event unless its terms are consistent with this Section 4.07.
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 4 in the judgment of the Board of Directors or the board of
directors of the successor Person. If, in the case of any such
recapitalization, reclassification, change, consolidation, merger, combination,
sale, lease, other transfer or statutory share exchange, the Reference Property
receivable thereupon by a holder of Common Stock includes shares of stock,
securities or other property or assets (including cash or any combination
thereof) of a Person other than the successor or purchasing Person, as the case
may be, in such recapitalization, reclassification, change, consolidation,
merger, combination, sale, lease, other transfer or statutory share exchange,
then such supplemental indenture shall also be executed by such other Person.

 

(b)           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 of the 

 

43

 

Securities maintained by the Registrar, 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 4.07
shall similarly apply to successive reclassifications, changes, consolidations,
mergers, combinations, sales and conveyances. If this Section 4.07 applies
to any Merger Event, Section 4.04 shall not apply.

 

Section 4.08.          Taxes on Shares Issued.  The Company will pay any documentary, stamp
or similar issue or transfer tax due on the issue or delivery of shares of
Common Stock on conversion of Securities pursuant hereto; provided, however,
that if such documentary, stamp or similar issue or transfer tax is due because
the Holder of such Securities has requested that shares of Common Stock be
issued in a name other than that of the Holder of the Securities converted,
then such taxes will be paid by the Holder, and the Company shall not be
required to issue or deliver any stock certificate evidencing such shares
unless and until the Holder shall have paid to the Company the amount of such
tax or shall have established to the satisfaction of the Company that such tax
has been paid.

 

Section 4.09.          Reservation of Shares; Shares to be
Fully Paid; Compliance With Governmental Requirements; Listing of Common Stock.  The Company shall reserve, out of its
authorized but unissued shares or shares held in treasury, sufficient shares of
Common Stock to satisfy conversion of the Securities from time to time as such
Securities are presented for conversion (assuming that, at the time of the
computation of such number of shares or securities, all such Securities would
be converted by a single Holder).

 

The Company covenants that
all shares of Common Stock that may be issued upon conversion of Securities
shall be newly issued shares or treasury shares, shall be duly authorized,
validly issued, fully paid and non-assessable and shall be free from preemptive
rights and free from any tax, lien or charge (other than those created by the
Holder).

 

The Company shall cause any
shares of Common Stock to be issued upon conversion of Securities to be
designated for quotation or listing, subject to notice of issuance, on each
national securities exchange or over-the-counter or other domestic market on
which the Common Stock is then listed or quoted.

 

Section 4.10.          Responsibility of Trustee.  The Trustee and any Conversion Agent shall
not at any time be under any duty or responsibility to any Holder of Securities
to determine or calculate the Conversion Rate, to determine whether any facts
exist which may require any adjustment of the Conversion Rate, or to confirm
the accuracy of any such adjustment when made or the appropriateness of the
method employed, or herein or in any supplemental indenture provided to be employed,
in making the same. The Trustee and any other Conversion Agent shall not be
accountable with respect to the validity or value (or the kind or amount) of
any shares of Common Stock or of any other securities or property that may at
any time be issued or delivered upon the conversion of any Securities; and the
Trustee and the Conversion Agent make no representations with respect thereto.
Neither the Trustee nor any Conversion Agent shall be responsible for any
failure of the Company to issue, transfer or deliver any shares of Common Stock
or stock certificates or other securities or property or cash upon the
surrender of any Securities for the purpose of conversion or to comply with any
of the duties, responsibilities or covenants of the Company contained in this Article 4.
The rights, privileges, protections, 

 

44

 

immunities and benefits
given to the Trustee, including without limitation its right to be compensated,
reimbursed, and indemnified, are extended to, and shall be enforceable by, the
Trustee in each of its capacities hereunder, including its capacity as
Conversion Agent.

 

Section 4.11.          Notice to Holders Prior to Certain
Actions.  In case:

 

(a)           the Company shall declare a dividend (or any other distribution)
on its Common Stock that would require an adjustment in the Conversion Rate
pursuant to Section 4.04; or

 

(b)           the Company shall authorize the granting to the holders of
all or substantially all of its Common Stock of rights or warrants to subscribe
for or purchase any share of any class or any other rights or warrants that
would require an adjustment in the Conversion Rate pursuant to Section 4.04
or Section 4.12 hereof; or

 

(c)           of any reclassification or reorganization of the Common
Stock of the Company (other than a subdivision or combination of its
outstanding Common Stock, or a change in par value, or from par value to no par
value, or from no par value to par value), or of any consolidation or merger to
which the Company is a party and for which approval of any stockholders of the
Company is required, or of the sale, lease or transfer of all or substantially
all of the assets of the Company and its consolidated Subsidiaries; or

 

(d)           of the voluntary or involuntary dissolution, liquidation
or winding up of the Company or any of its Subsidiaries;

 

then, in each case (unless
notice of such event is otherwise required pursuant to another provision of
this Indenture), the Company shall cause to be filed with the Trustee and the
Conversion Agent and to be mailed to each Holder of Securities at such Holder’s
address appearing on a list of Holders of Securities, which the Company shall
provide to the Trustee, as promptly as practicable but in any event at least 10
days prior to the applicable date hereinafter specified, a notice stating (x) the
date on which a record is to be taken for the purpose of such dividend (or any
other distribution) or 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 or rights or warrants are to be determined, or (y) the
date on which such reclassification, reorganization, consolidation, merger,
sale, lease, transfer, dissolution, liquidation or winding up is expected to
become effective or occur, and the date as of which it is expected that holders
of Common Stock of record shall be entitled to exchange their Common Stock for
securities or other property deliverable upon such reclassification,
reorganization, consolidation, merger, sale, transfer, dissolution, liquidation
or winding up. Failure to give such notice, or any defect therein, shall not
affect the legality or validity of such dividend (or any other distribution),
reclassification, reorganization, consolidation, merger, sale, transfer,
dissolution, liquidation or winding up.

 

Section 4.12.          Stockholder Rights Plan.  Each share of Common Stock issued upon
conversion of Securities pursuant to this Article 4 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
stockholder rights plan adopted by the Company, as the same may be amended from
time to 

 

45

 

time. Notwithstanding the
foregoing, if prior to any conversion such rights have separated from the
shares of Common Stock in accordance with the provisions of the applicable
stockholder rights agreement, the Conversion Rate shall be adjusted at the time
of separation as if the Company had distributed to all holders of the Common
Stock, shares of the Company’s capital stock, evidences of indebtedness,
assets, property, rights or warrants as described in Section 4.04(c) above,
subject to readjustment in the event of the expiration, termination or
redemption of such rights.

 

ARTICLE 5

 

COVENANTS

 

Section 5.01.          Payment of Securities.

 

(a)           The Company shall duly and punctually pay the principal of
and interest (including Special Interest, if any) on the Securities in
accordance with the terms of the Securities and this Indenture, and will duly
comply with all the other terms, agreements and conditions contained in, or
made in this Indenture for the benefit of, the Holders.

 

(b)           A payment of principal or interest (including Special
Interest, if any) shall be considered paid on the date it is due if the Paying
Agent (other than the Company) (or if the Company is the Paying Agent, the
segregated account or separate trust fund maintained by the Company pursuant to
Section 2.04) holds by 10:00 a.m., New York City time, on that date
money, deposited by or on behalf of the Company sufficient to make the
payment.  Accrued and unpaid interest
(including Special Interest), if any, on any Security that is payable (whether
or not punctually paid or duly provided for) on any Interest Payment Date shall
be paid to the Person in whose name that Security is registered at the close of
business on the Regular Record Date for such interest at the office or agency
of the Company maintained for such purpose. 
The Company shall, to the fullest extent permitted by law, pay interest
in immediately available funds on overdue principal and interest at the annual
rate borne by the Securities compounded semiannually, which interest shall
accrue from the date such overdue amount was originally due to the day
preceding the date payment of such amount, including interest thereon, has been
made or duly provided for.  All such
interest shall be payable on demand.

 

(c)           Payment of the principal of and interest (including
Special Interest), if any, on the Securities shall be made at the office or
agency of the Company maintained for that purpose (which shall initially be the
Corporate Trust Office of the Trustee) in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts; provided, however, that at the option of the Company payment of
interest (including Special Interest) on any Certificated Securities having an
aggregate principal amount of $5,000,000 or less may be made by check mailed to
the address of the Person entitled thereto as such address appears in the
Register; provided further that a Holder of a
Certificated Security having an aggregate principal amount of more than
$5,000,000 will be paid by wire transfer in immediately available funds at the
election of such Holder if such Holder has provided wire transfer instructions
to the Trustee at least 10 Business Days prior to the payment date.  Any wire 

 

46

 

transfer instructions received by the Trustee will remain in effect
until revoked by the Holder.  In the case
of a permanent Global Security, interest (including Special Interest), if any,
payable on any applicable payment date will be paid to the Depositary, with
respect to that portion of such permanent Global Security held for its account
by Cede & Co. for the purpose of permitting such party to credit the
interest received by it in respect of such permanent Global Security to the
accounts of the beneficial owners thereof.

 

Section 5.02.          Reports by Company.

 

(a)           Whether or not the Company and the Subsidiary Guarantors
are required to file reports with the SEC, the Company and the Subsidiary
Guarantors shall deliver to the Trustee copies of all annual reports, quarterly
reports and other documents that they would be required to file with the SEC
pursuant to Sections 13 or 15(d) of the Exchange Act, within 15 days
after such reports and other documents would be required to be filed with the
SEC (giving effect to any grace period provided by Rule 12b-25 under the
Exchange Act).

 

(b)           The Company intends to file its reports referred to in Section 5.02(a) hereof
with the SEC in electronic form pursuant to Regulation S-T of the SEC using the
SEC’s Electronic Data Gathering, Analysis and Retrieval (“EDGAR”) system.  The Company shall notify the Trustee in the
manner prescribed herein of each such filing. 
The Trustee will be directed to access the EDGAR system for purposes of
retrieving the reports so filed. 
Compliance with the foregoing shall constitute delivery by the Company
of such reports to the Trustee in compliance with the provisions of Section 5.02(a) hereof.  The Trustee shall have no duty to search for
or obtain any electronic or other filings that the Company makes with the SEC,
regardless of whether such filings are periodic, supplemental or otherwise.

 

(c)           Delivery of such reports and documents to the Trustee is
for informational purposes only and the Trustee’s receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the compliance by
the Company and the Subsidiary Guarantors with any of their respective
covenants hereunder (as to which the Trustee is entitled to rely exclusively on
Officer’s Certificates).

 

Section 5.03.          Compliance Certificates.

 

The Company and each
Subsidiary Guarantor shall deliver to the Trustee, within one hundred twenty
(120) days after the end of each fiscal year of the Company (beginning with the
fiscal year ending December 31, 2009), an Officer’s Certificate as to the
signer’s knowledge of the Company’s or such Subsidiary Guarantor’s compliance
with all conditions and covenants on its part contained in this Indenture and
stating whether or not the signer knows of any Default or Event of
Default.  If such signer knows of such a
Default or Event of Default, the Officer’s Certificate shall describe the
Default or Event of Default and the efforts to remedy the same.  For the purposes of this Section 5.03,
compliance shall be determined without regard to any grace period or
requirement of notice provided pursuant to the terms of this Indenture.  Such certificates need not comply with Section 12.04
of this Indenture.

 

47

 

Section 5.04.          Further Instruments and Acts.

 

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

 

Section 5.05.          Maintenance of Corporate Existence.

 

Subject to Article 6,
the Company will do or cause to be done all things necessary to preserve and
keep in full force and effect its corporate existence.

 

Section 5.06.          Issuances
of Subsidiary Guarantees.

 

The Company shall cause each
Subsidiary of the Company that Guarantees Indebtedness of the Company under any
outstanding debt securities of the Company or any of the Company’s obligations
under any credit facility to execute and deliver a supplemental indenture to
this Indenture providing for a Note Guarantee by such Subsidiary pursuant to Article Eleven.

 

Section 5.07.          Stay, Extension And Usury Laws.

 

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

 

Section 5.08.          Payment of Special Interest.

 

If Special Interest is
payable by the Company pursuant to the terms of the Securities and this
Indenture, the Company shall deliver to the Trustee an Officer’s Certificate to
that effect stating (i) the amount of such Special Interest that is
payable, (ii) the reason why such Special Interest is payable and (iii) the
date on which such Special Interest is payable. 
Unless and until a Trust Officer of the Trustee receives such a
certificate, the Trustee may assume without inquiry that no such Special
Interest is payable.  If the Company has
paid Special Interest directly to the Persons entitled to such Special
Interest, the Company shall deliver to the Trustee a certificate setting forth
the particulars of such payment.

 

Section 5.09.          Maintenance of Office or Agency.

 

The Company shall maintain
an office or agency where Securities may be presented or surrendered for
payment.  The Company also will maintain
an office or agency where Securities 

 

48

 

may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
the Company in respect of the Securities and this Indenture may be served.  The office of the Trustee, at its Corporate
Trust Office, will be such office or agency of the Company, unless the Company
shall designate and maintain some other office or agency for one or more of
such purposes.  The Company will give
prompt written notice to the Trustee of the location and any change in the
location of any such offices or agencies. 
If at any time the Company shall fail to maintain any such required
offices or agencies or shall fail to furnish the Trustee with the address
thereof, such presentations, surrenders, notices and demands may be made or
served at the office of the Trustee and the Company hereby appoints the Trustee
as its agent to receive all such presentations, surrenders, notices and
demands.

 

The Company may from time to
time designate one or more other offices or agencies (in or outside of The City
of New York) where the Securities may be presented or surrendered for any or
all such purposes, and may from time to time rescind such designation.  The Company will give prompt written notice
to the Trustee of any such designation or rescission and any change in the
location of any such office or agency.

 

ARTICLE 6

 

CONSOLIDATION; MERGER; SALE
OF ASSETS

 

Section 6.01.          Company or Subsidiary Guarantors May Consolidate,
Etc., Only on Certain Terms.

 

(a)           The Company shall not consolidate with, merge with or
into, or sell, convey, transfer, lease or otherwise dispose of all or
substantially all of its property and assets (as an entirety or substantially
an entirety in one transaction or a series of related transactions) to, any
Person or permit any Person to merge with or into it unless, unless:

 

(1)           it
shall be the continuing Person, or the Person (if other than it) formed by such
consolidation or into which it is merged or that acquired or leased such
property and assets (the “Surviving Person”), shall be a corporation
organized and validly existing under the laws of the United States of America
or any jurisdiction thereof and shall expressly assume, by a supplemental
indenture, executed and delivered to the Trustee, all of the Company’s
obligations under this Indenture and the Securities;

 

(2)           immediately
after giving effect to such transaction, no Default or Event of Default shall
have occurred and be continuing;

 

(3)           it
delivers to the Trustee an Officer’s Certificate and Opinion of Counsel, in
each case stating that such consolidation, merger or transfer and such
supplemental indenture complies with this Section 6.01 and that all
conditions precedent provided for herein relating to such transaction have been
complied with; and

 

(4)           each
Subsidiary Guarantor, unless such Subsidiary Guarantor is the Person with which
the Company has entered into a transaction under this Section 6.01, shall
have by amendment to its Note Guarantee confirmed that its Note Guarantee shall

 

49

 

apply to the obligations of the Company or the Surviving Person in
accordance with the Securities and this Indenture.

 

Each Subsidiary Guarantor (other than any Subsidiary
Guarantor whose Note Guarantee is to be released in accordance with the terms
of its Note Guarantee and this Indenture, in connection with the sale, exchange
or transfer to any Person (other than an Affiliate of the Company) of all the
Capital Stock of such Subsidiary Guarantor) will not, and the Company will not
cause or permit any Subsidiary Guarantor to, consolidate with or merge with or
into any Person other than the Company or any other Subsidiary Guarantor
unless:

 

(1)           such
Subsidiary Guarantor shall be the continuing person, or the person (if other
than such Subsidiary Guarantor) formed by such consolidation or into which it
is merged or that acquired or leased such property and assets (the “Surviving
Guarantor”), shall be a corporation organized and validly existing under
the laws of the United States of America or any jurisdiction thereof, and shall
expressly assume, by a supplemental indenture, executed and delivered to the
Trustee, all of such Subsidiary Guarantor’s obligations under this Indenture
and its Note Guarantee; and

 

(2)           immediately
after giving effect to such transaction, no Default or Event of Default shall
have occurred and be continuing.

 

The Surviving Guarantor
shall succeed to, and, except in the case of a lease, be substituted for, such
Subsidiary Guarantor under this Indenture and such Subsidiary Guarantor’s Note
Guarantee.

 

Section 6.02.          Successor Substituted.

 

Upon any consolidation or
merger, or any sale, conveyance, transfer, lease or other disposition of all or
substantially all of the property and assets of the Company or any Subsidiary
Guarantor in accordance with Section 6.01 of this Indenture, the successor
Person formed by such consolidation or into which the Company or any Subsidiary
Guarantor is merged or to which such sale, conveyance, transfer, lease or other
disposition is made shall succeed to and be substituted for, and may exercise
every right and power of, the Company or such Subsidiary Guarantor under this
Indenture with the same effect as if such successor Person had been named as
the Company or such Subsidiary Guarantor herein; provided that the Company
shall not be released from its obligation to pay the principal of, premium, if
any, or interest on the Securities and such Subsidiary Guarantor shall not be
released from its Note Guarantee in the case of a lease of all or substantially
all of its property and assets.

 

ARTICLE 7

 

DEFAULT AND REMEDIES

 

Section 7.01.          Events of Default.

 

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

 

50

 

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):

 

(1)           a
default in the payment of the principal amount, Redemption Price, Fundamental
Change Purchase Price with respect to any Security when such payment becomes
due and payable; or

 

(2)           a
default for 30 days in the payment of any interest (including Special Interest,
if any) on the Securities; or

 

(3)           a
failure by the Company to comply with its obligation to convert the Securities
in accordance with the Indenture upon exercise of any Holder’s conversion
rights; or

 

(4)           failure
by the Company to provide an Fundamental Change Company Notice within the time
required to provide such notice as set forth in Section 3.08(b) hereof;
or

 

(5)           failure
to redeem any Securities called for redemption after the Company has exercised
its option to redeem such Securities; or

 

(6)           failure
to purchase all or any part of the Securities in accordance with Sections 3.08
hereof; or

 

(7)           failure
to perform or observe any other covenant or agreement in this Indenture with respect
to the Securities (other than a covenant or agreement in respect of which the
Company’s non-compliance would otherwise be an event of default) and such
default or breach continues for a period of 60 consecutive days after written
notice to the Company by the Trustee or to the Company and the Trustee by the
Holder of 25% or more in aggregate principal amount of the Securities then
Outstanding; or

 

(8)           there
occurs with respect to any issue or issues of Indebtedness of the Company, any
Subsidiary Guarantor or any Significant Subsidiary having an outstanding
principal amount of $75 million or more in the aggregate for all such issues of
all such Persons, whether such Indebtedness now exists or shall hereafter be
created, (A) an event of default that has caused the holder thereof to
declare such Indebtedness to be due and payable prior to its stated maturity
and such Indebtedness has not been discharged in full or such acceleration has
not been rescinded or annulled within 30 days of such acceleration and/or (B) the
failure to make a principal payment at the final (but not any interim) fixed
maturity and such defaulted payment shall not have been made, waived or
extended within 30 days of such payment default; or

 

(9)           any
final judgment or order (not covered by insurance) for the payment of money in
excess of $75 million in the aggregate for all such final judgments or orders
against all such Persons (treating any deductibles, self-insurance or retention
as not so covered) shall be rendered against the Company, any Subsidiary
Guarantor or any Significant Subsidiary and shall not be paid or discharged,
and there shall be any period of 60 consecutive days following entry of
the final judgment or order that causes the 

 

51

 

aggregate amount for all such final judgments or orders outstanding and
not paid or discharged against all such Persons to exceed $75 million during
which a stay of enforcement of such final judgment or order, by reason of a
pending appeal or otherwise, shall not be in effect; or

 

(10)         the
Company, any Subsidiary Guarantor or any Significant Subsidiary of the Company
pursuant to or within the meaning of any Bankruptcy Law:

 

(A)          commences
a voluntary insolvency proceeding;

 

(B)           consents
to the entry of an order for relief against it in an involuntary insolvency
proceeding or consents to its dissolution or winding-up;

 

(C)           consents
to the appointment of a custodian of it or for any substantial part of its
property; or

 

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

 

or
takes any comparable action under any foreign laws relating to insolvency; provided, however,
that the liquidation of any Subsidiary into another Subsidiary, other than as
part of a credit reorganization, shall not constitute an Event of Default under
this Section 7.01(a)(10); or

 

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

 

(A)          is
for relief against the Company, any Subsidiary Guarantor or any Significant
Subsidiary of the Company in an involuntary insolvency proceeding;

 

(B)           appoints
a custodian of the Company, any Subsidiary Guarantor or any Significant
Subsidiary of the Company for any substantial part of their property;

 

(C)           orders
the winding-up, liquidation or dissolution of the Company, any Subsidiary
Guarantor or any Significant Subsidiary of the Company;

 

(D)          orders
the presentation of any plan or arrangement, compromise or reorganization of
the Company, any Subsidiary Guarantor or any Significant Subsidiary of the
Company; or

 

(E)           grants
any similar relief under any foreign laws;

 

and
in each such case the order or decree remains unstayed and in effect for 90
days; or

 

(12)         any
Subsidiary Guarantor repudiates its obligations under its Note Guarantee or,
except as permitted by this Indenture, any Note Guarantee is determined to be
unenforceable or invalid or shall for any reason cease to be in full force and
effect.

 

52

 

(b)                                 Notwithstanding Section 7.01(a) no
Event of Default under clause (7) of Section 7.01(a) shall
occur until the Trustee notifies the Company in writing, or the Holders of at
least 25% in aggregate principal amount of the Securities then Outstanding notify
the Company and the Trustee in writing, of the Default (a “Notice of Default”),
and the Company does not cure the Default within the time specified in
clause (7) of Section 7.01(a), or obtain a waiver, after receipt
of such notice.  A notice given pursuant
to this Section 7.01 shall be given by registered or certified mail, must
specify the Default, demand that it be remedied and state that the notice is a
Notice of Default.  When any Default
under this Section 7.01 is cured, it ceases.

 

(c)                                  The Company will deliver to
the Trustee, within 30 days after becoming aware of the occurrence of a Default
or Event of Default, written notice thereof.

 

Section 7.02.                             Acceleration; Special
Interest.

 

If an Event of Default
(other than an Event of Default specified in clause (10) or (11) of Section 7.01(a))
shall occur and be continuing with respect to this Indenture, the Trustee or
the Holders of not less than 25% in aggregate principal amount of the
Securities then Outstanding may, declare all unpaid principal of and accrued
interest (including Special Interest), if any, on all Securities through the
date of such declaration to be due and payable, by a notice in writing to the
Company (and to the Trustee if given by the Holders of the Securities).  Upon any such declaration, such principal and
interest (including Special Interest), if any, shall become due and payable
immediately.  If an Event of Default
specified in clause (10) or (11) of Section 7.01(a) occurs
and is continuing, then all the Securities shall ipso facto become and be due
and payable immediately in an amount equal to the principal amount of the
Securities, together with accrued and unpaid interest (including Special
Interest), if any, to the date the Securities become due and payable, without
any declaration or other act on the part of the Trustee or any Holder.  Thereupon, the Trustee may, at its
discretion, proceed to protect and enforce the rights of the Holders of the
Securities by appropriate judicial proceedings.

 

After a declaration of
acceleration with respect to the Securities, but before a judgment or decree
for payment of the money due has been obtained by the Trustee as hereinafter in
this Article provided, the Holders of a majority in aggregate principal
amount of the Securities Outstanding, by written notice to the Company and the
Trustee, may rescind and annul such declaration and its consequences if:

 

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

 

(1)                                  all amounts
owing to the Trustee under Section 8.07, including all sums paid or
advanced by the Trustee under this Indenture and the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel,

 

(2)                                  all overdue
interest (including Special Interest), if any, on all Outstanding Securities,

 

(3)                                  the principal
of any Outstanding Securities which have become due otherwise than by such
declaration of acceleration and interest (including Special Interest) thereon
at the rate borne by the Securities, and

 

53

 

(4)                                  to the extent
that payment of such interest is lawful, interest upon overdue interest at the
rate borne by the Securities;

 

(b)                                 the rescission would not
conflict with any judgment or decree of a court of competent jurisdiction; and

 

(c)                                  all Defaults or Events of
Default, other than the non-payment of principal of and interest on the
Securities which have become due solely by such declaration of acceleration,
have been cured or waived as provided in Section 7.13.  No such rescission shall affect any
subsequent Default or impair any right consequent thereon.

 

Notwithstanding the foregoing, the sole
remedy for an Event of Default relating to the failure by the Company to comply
with the provisions of Section 5.02 of this Indenture and for any failure
to comply with Section 314(a)(1) of the Trust Indenture Act shall,
for the first 180 days after the occurrence of such an Event of Default,
consist exclusively of the right to receive special interest (“Special
Interest”) on the Securities at an annual rate equal to 0.50% of the
principal amount of the Securities.  Such
Special Interest shall be paid semi-annually in arrears, with the first
semi-annual payment due on the first Interest Payment Date following the date
on which such Special Interest began to accrue on the Securities.  Special Interest shall accrue on all
Outstanding Securities from and including the date on which an Event of Default
relating to a failure to comply with the provisions of Section 5.02 or
failure to comply with Section 314(a)(1) of the Trust Indenture Act
shall first occur to but not including the 180th day thereafter (or such
earlier date on which such Event of Default shall have been cured or waived by
Holders of a majority in principal amount of the Outstanding Securities).  On such 180th day (or earlier, if the Event
of Default relating to the failure to comply with Section 5.02 and failure
to comply with Section 314(a)(1) of the Trust Indenture Act is cured
or waived prior to such 180th day), such Special Interest shall cease to accrue
and, if the Event of Default relating to the failure to comply with Section 5.02
and failure to comply with Section 314(a)(1) of the Trust Indenture
Act shall not have been cured or waived prior to such 180th day, the Securities
shall be subject to acceleration as provided in this Section 7.02.  The provisions of this paragraph shall not
affect the rights of Holders in the event of the occurrence of any other Event
of Default.  In the event the Company
shall not elect to pay Special Interest upon an Event of Default resulting from
the failure of the Company to comply with the provisions of Section 5.02
and for any failure by it to comply with Section 314(a)(1) of the
Trust Indenture Act, the Securities shall be subject to acceleration as
provided above in this Section 7.02.

 

If the Company shall elect to pay Special
Interest in connection with an Event of Default relating to its failure to
comply with the requirements of Section 5.02 and for any failure by it to
comply with Section 314(a)(1) of the Trust Indenture Act, (1) the
Company shall notify all Holders and the Trustee and Paying Agent of such
election on or before the close of business on the Business Day immediately
preceding the day on which such Event of Default shall first occur, and (2) all
references herein to interest accrued or payable as of any date shall include
any Special Interest accrued or payable as of such date as provided in this Section 7.02.

 

54

 

Section 7.03.                             Collection of Indebtedness
and Suits for Enforcement by Trustee.

 

The Company and each Subsidiary Guarantor
covenants that if:

 

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

 

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

 

the Company and such
Subsidiary Guarantor will, upon demand of the Trustee, pay to it, for the
benefit of the Holders of such Securities, the whole amount then due and
payable on such Securities for principal and interest (including Special
Interest, if any), with interest upon the overdue principal and, to the extent
that payment of such interest shall be legally enforceable, upon overdue
installments of interest, at the rate borne by the Securities; 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 or any Subsidiary Guarantor,
as the case may be, 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 and may
prosecute such proceeding to judgment or final decree, and may enforce the same
against the Company or any Subsidiary Guarantor or any other obligor upon the
Securities and collect the moneys adjudged or decreed to be payable in the
manner provided by law out of the property of the Company, any Subsidiary
Guarantor or any other obligor upon the Securities, wherever situated.

 

If an Event of Default occurs and is
continuing, the Trustee may in its discretion proceed to protect and enforce
its rights and the rights of the Holders under this Indenture or any Guarantee
by such appropriate private or judicial proceedings as the Trustee shall deem
most effectual to protect and enforce such rights of 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,
subject however to Section 7.12.  No
recovery of any such judgment upon any property of the Company or any Guarantor
shall affect or impair any rights, powers or remedies of the Trustee or the
Holders.

 

Section 7.04.                             Trustee May File Proofs
of Claim.

 

In case of the pendency of any receivership,
insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment,
composition or other judicial proceeding relative to the Company or any other
obligor upon the Securities or the property of the Company or of such other obligor
or their 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,

 

55

 

(a)                                  to file and prove a claim
for the whole amount of principal and interest (including Special Interest, if
any) 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 allowed in such judicial proceeding, and

 

(b)                                 to collect and receive any
moneys or other property payable or deliverable on any such claims and to distribute
the same;

 

and any custodian, receiver,
assignee, trustee, liquidator, sequestrator or similar official in any such
judicial proceeding is hereby authorized by each Holder to make such payments
to the Trustee and, in the event that the Trustee shall consent to the making
of such payments directly to the Holders, to pay the Trustee any amount due 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 8.07.

 

Nothing herein contained shall be deemed to
authorize the Trustee to authorize or consent to or accept or adopt on behalf
of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of any Holder thereof, or to
authorize the Trustee to vote in respect of the claim of any Holder in any such
proceeding.

 

Section 7.05.                             Trustee May Enforce
Claims Without Possession of Securities.

 

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

 

Section 7.06.                             Application of Money
Collected.

 

Any money collected by the Trustee pursuant
to this Article 7 or otherwise on behalf of the Holders or the Trustee
pursuant to this Article 7 or through any proceeding or any arrangement or
restructuring in anticipation or in lieu of any proceeding contemplated by this
Article 7 and any money or other property distributable in respect of the
Company’s obligations under this Indenture after an Event of Default shall be
applied, subject to applicable law, in the following order, at the date or
dates fixed by the Trustee and, in case of the distribution of such money on
account of principal or interest, upon presentation of the Securities and the
notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:

 

FIRST: 
To the payment of all amounts due the Trustee (or any predecessor
trustee) under Section 8.07;

 

SECOND: 
To the payment of the amounts then due and unpaid upon the Securities
for principal and interest (including Special Interest, if any), in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, 

 

56

 

according to the amounts due
and payable on such Securities for principal and interest (including Special
Interest, if any); and

 

THIRD: 
The balance, if any, to the Person or Persons entitled thereto,
including the Company, provided that all sums due and owing to the Holders and
the Trustee have been paid in full as required by this Indenture.

 

Section 7.07.                             Limitation on Suits.

 

Subject to Section 7.08, no Holder of
any Securities shall have any right to institute any proceeding, judicial or
otherwise, with respect to this Indenture or the Securities, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless

 

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

 

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

 

(c)                                  such Holder or Holders have
offered to the Trustee security or indemnity satisfactory to the Trustee
against any loss, liability or expense (including fees and expenses of its
counsel) to be incurred in compliance with such request;

 

(d)                                 the Trustee has failed to
institute the proceeding and has not received direction inconsistent with the
original request from the Holders of a majority in principal amount of the
Outstanding Securities within 60 days after the original request;

 

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

 

Section 7.08.                             Unconditional Right of
Holders to Receive Payment and to Convert.

 

Notwithstanding any other provision of this
Indenture, the right of any Holder of a Security to receive payment of the
principal amount, accrued and unpaid interest, if any, Redemption Price,
Fundamental Change Purchase Price or Special Interest, if any, in respect of
the Securities held by such Holder, on or after the respective due dates
expressed in the Securities and this Indenture (whether upon repurchase or
otherwise), and to convert such Security in accordance with Article 4, and
to bring suit for the enforcement of any such payment on or after such
respective due dates or for the right to convert in accordance with Article 4,
is absolute and unconditional and shall not be impaired or affected without the
consent of the Holder.

 

57

 

Section 7.09.                             Restoration of Rights and
Remedies.

 

If the Trustee or any Holder has instituted
any proceeding to enforce any right or remedy under this Indenture or any
Guarantee 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 the Company, any Guarantor, any other obligor on the
Securities, the Trustee and the Holders shall, subject to any determination in
such proceeding, 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 7.10.                             Rights and Remedies
Cumulative.

 

No right or remedy herein conferred upon or
reserved to the Trustee or to the Holders is intended to be exclusive of any
other right or remedy, and every right and remedy shall, to the extent
permitted by law, be cumulative and in addition to every other right and remedy
given hereunder or now or hereafter existing at law or in equity or
otherwise.  The assertion or employment
of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.

 

Section 7.11.                             Delay or Omission Not Waiver.

 

No delay or omission of the Trustee or of any
Holder of any Security to exercise any right or remedy accruing upon any Event
of Default shall impair any such right or remedy or constitute a waiver of any
such Event of Default or an acquiescence therein.  Every right and remedy given by this Article 7
or by law to the Trustee or to the Holders may be exercised from time to time,
and as often as may be deemed expedient, by the Trustee or by the Holders, as
the case may be.

 

Section 7.12.                             Control by Holders.

 

The Holders of not less than a majority in
aggregate principal amount of the Outstanding Securities shall have the right
to direct the time, method and place of conducting any proceeding for
exercising any remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee, provided that:

 

(a)                                  such direction shall not be
in conflict with any rule of law or with this Indenture, expose the
Trustee to personal liability or expenses for which the Trustee has not
received adequate indemnity as determined by it in good faith or be unduly
prejudicial to Holders not joining therein; and

 

(b)                                 subject to the provisions of
Section 315 of the TIA, the Trustee may take any other action deemed
proper by the Trustee which is not inconsistent with such direction.

 

Section 7.13.                             Waiver of Past Defaults.

 

Subject to Section 7.08, the Holders of
a majority in aggregate principal amount of the Securities then Outstanding by
notice to the Trustee may waive an existing Default or Event of Default and its
consequences, except an uncured Default or Event of Default in the payment of 

 

58

 

the principal of or any
accrued but unpaid interest (including Special Interest) on any Security, an
uncured failure by the Company to convert any Securities into Common Stock and
cash, as applicable, or any Default or Event of Default in respect of any
provision of this Indenture or the Securities which, under Section 10.02,
cannot be modified or amended without the consent of the Holder of each
Security affected.  When a Default or
Event of Default is waived, it is cured and ceases to exist.

 

Section 7.14.                             Undertaking for Costs.

 

All parties to this Indenture agree, and each
Holder of any Security by his acceptance thereof shall be deemed to have
agreed, that any court may in its discretion require, in any suit for the enforcement
of any right or remedy under this Indenture, or 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 Trustee, to any suit instituted by any Holder, or group
of Holders, holding in the aggregate more than 10% in principal amount of the
Outstanding Securities, or to any suit instituted by any Holder for the
enforcement of the payment of the principal of or interest (including Special
Interest, if any) on, any Security on or after the respective Stated Maturities
expressed in such Security (or, in the case of purchase pursuant to Article 3
hereof, on the Fundamental Change Purchase Date).

 

Section 7.15.                             Remedies Subject to
Applicable Law.

 

All rights, remedies and powers provided by
this Article 7 may be exercised only to the extent that the exercise
thereof does not violate any applicable provision of law in the premises, and
all the provisions of this Indenture are intended to be subject to all
applicable mandatory provisions of law which may be controlling in the premises
and to be limited to the extent necessary so that they will not render this
Indenture invalid, unenforceable or not entitled to be recorded, registered or
filed under the provisions of any applicable law.

 

ARTICLE 8

 

TRUSTEE

 

Section 8.01.                             Duties of Trustee.

 

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

 

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

 

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

 

59

 

(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.  However,
in the case of any such certificates or opinions which by any provision hereof
are specifically required to be furnished to the Trustee, the Trustee shall be under
a duty to examine the same to determine whether or not they conform to the
requirements of this Indenture (but need not confirm or investigate the
accuracy of mathematical calculations or other facts stated therein).

 

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

 

(1)                                  this
clause (c) does not limit the effect of clauses (b) or (d) of
this Section 8.01;

 

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

 

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

 

(d)                                 No provision of this
Indenture shall require the Trustee to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it;

 

(e)                                  Whether or not therein
expressly so provided, every provision of this Indenture that in any way
relates to the Trustee is subject to clauses (a), (b), (c), (d) and (f) of
this Section 8.01; and

 

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

 

Section 8.02.                             Notice of Default.

 

Within 90 days after the occurrence of any
Default, the Trustee shall transmit by mail to all Holders and any other
Persons entitled to receive reports pursuant to Section 313(c) of the
TIA, as their names and addresses appear in the Security Register, notice of
such Default hereunder known to the Trustee, unless such Default shall have
been cured or waived; provided, however, that, except in the case of a Default in the
payment of the principal of or interest on any 

 

60

 

Security, the Trustee shall
be protected in withholding such notice if and so long as a trust committee of
Trust Officers of the Trustee in good faith determines that the withholding of
such notice is in the interest of the Holders.

 

Section 8.03.                             Certain Rights of Trustee.

 

Subject to the provisions of Section 8.01
hereof :

 

(a)                                  the Trustee may conclusively
rely and shall be fully protected in acting or refraining from acting upon
receipt by it of any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or parties;

 

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

 

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

 

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

 

(e)                                  the Trustee shall not be
liable for any action taken, suffered or omitted by it in good faith and
believed by it to be authorized or within the discretion, rights or powers
conferred upon it by this Indenture;

 

(f)                                    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, approval, appraisal, bond, debenture, note,
coupon, security 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 deem 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;

 

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

 

61

 

(h)                                 the Trustee shall not be
charged with knowledge of any Default or Event of Default with respect to the
Securities unless either (i) a Trust Officer of the Trustee shall have
actual knowledge of such Default or Event of Default or (ii) written
notice of such Default or Event of Default shall have been given to the Trustee
by the Company, any Subsidiary Guarantor or by any Holder of Securities;

 

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

 

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

 

(k)                                  the permissive rights of the
Trustee enumerated herein shall not be construed as duties of the Trustee;

 

(l)                                     the Trustee may request that
the Company deliver an Officer’s Certificate setting forth the names of
individuals and/or titles of officers authorized at such time to take specified
actions pursuant to this Indenture, which Officer’s Certificate may be signed
by any person authorized to sign an Officer’s Certificate, including any person
specified as so authorized in any such certificate previously delivered and not
superseded;

 

(m)                               the Trustee may employ or retain
such counsel, accountants, appraisers or other experts or advisers as it may
reasonably require for the purpose of determining and discharging its rights
and duties hereunder and shall not be responsible for any misconduct or
negligence on the part of any of them selected by the Trustee using due care;

 

(n)                                 the Trustee shall not be
required to give any note, bond or surety in respect of the execution of the
trusts and powers under this Indenture; and

 

the Trustee shall not be
responsible or liable for any failure or delay in the performance of its
obligations under this Indenture arising out of or caused, directly or
indirectly, by circumstances beyond its reasonable control, including, without
limitation, acts of God, earthquakes, fire, flood, terrorism, wars and other
military disturbances, sabotage, epidemics, riots, interruptions, losses or
malfunctions of utilities, computers (hardware or software) or communications
services, labor disputes, acts of civil or military authorities and
governmental action.

 

Section 8.04.                             Trustee Not Responsible for
Recitals, Dispositions of Securities or Application of Proceeds Thereof.

 

The recitals contained herein and in the
Securities, except the Trustee’s certificates of authentication, shall be taken
as the statements of the Company and the Subsidiary Guarantors, and the Trustee
assumes no responsibility for their correctness.  The Trustee makes no representations as to
the validity or sufficiency of this Indenture or of the Securities.  The Trustee 

 

62

 

shall not be accountable for
the use or application by the Company of Securities or the proceeds thereof.

 

Section 8.05.                             Trustee and Agents May Hold
Securities; Collections; etc.

 

The Trustee, any Paying Agent, Registrar,
Conversion Agent or any other agent of the Company, in its individual or any
other capacity, may become the owner or pledgee of Securities, with the same
rights it would have if it were not the Trustee, Paying Agent, Registrar,
Conversion Agent or such other agent and, subject to TIA Sections 310 and
311, may otherwise deal with the Company or any Subsidiary Guarantor and
receive, collect, hold and retain collections from the Company or any
Subsidiary Guarantor with the same rights it would have if it were not the
Trustee, Paying Agent, Registrar, Conversion Agent or such other agent.

 

Section 8.06.                             Money Held in Trust.

 

All moneys received by the Trustee shall,
until used or applied as herein provided, be held in trust for the purposes for
which they were received, but need not be segregated from other funds except to
the extent required by mandatory provisions of law.

 

Section 8.07.                             Compensation and
Indemnification of Trustee and Its Prior Claim.

 

The Company covenants and agrees to pay to
the Trustee from time to time, and the Trustee shall be entitled to, such
compensation as the parties shall agree in writing from time to time for all
services rendered by it hereunder (which compensation shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust) and the Company covenants and agrees to pay or reimburse the Trustee and
each predecessor Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by or on behalf of the Trustee 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 any such
expense, disbursement or advance as may arise from its negligence, bad faith or
willful misconduct.  The Company and each
Subsidiary Guarantor, jointly and severally, also covenant and agree to
indemnify the Trustee and each predecessor Trustee for, and to hold it harmless
against, any claim, loss, liability, tax, assessment or other governmental
charge (other than taxes applicable to the Trustee’s compensation hereunder) or
expense incurred without negligence or willful misconduct on its part, arising
out of or in connection with the acceptance or administration of this Indenture
or the trusts hereunder and its duties hereunder, including enforcement of this
Section 8.07 and also including any liability which the Trustee may incur
as a result of failure to withhold, pay or report any tax, assessment or other
governmental charge, and the costs and expenses of defending itself against or
investigating any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder.  The obligations of the Company under this Section 8.07
to compensate and indemnify the Trustee and each predecessor Trustee and to pay
or reimburse the Trustee and each predecessor Trustee for reasonable expenses,
disbursements and advances shall constitute an additional obligation hereunder
and, together with the lien referred in the next sentence, shall survive the
satisfaction and discharge, and termination for any reason, of this Indenture
and the resignation or removal of the Trustee and each predecessor Trustee.  To secure the Company’s obligations in this Section 8.07,
the Trustee 

 

63

 

shall have a lien prior to
the Securities on all money and property held or collected by the Trustee,
other than money or property held in trust for the payment of principal of or
interest on particular Securities.

 

“Trustee” for purposes of this Section shall
include any predecessor Trustee; provided, however, that the negligence,
willful misconduct or bad faith of any Trustee hereunder shall not affect the
rights of any other Trustee hereunder.

 

Without prejudice to its other rights
hereunder, when the Trustee incurs expenses or renders services in connection
with an Event of Default specified in Section 7.01(a)(7) or Section 7.01(a)(8),
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 applicable Federal or State bankruptcy, insolvency or
other similar law.

 

Section 8.08.                             Conflicting Interests.

 

The Trustee shall comply with the provisions
of Section 310(b) of the TIA provided, however, that
there shall be excluded from the operation of Section 310(b)(1) of
the TIA any indenture or indentures under which other securities or
certificates of interest or participation in other securities of the Company
are outstanding if the requirements for such exclusion set forth in TIA §310(b)(1) are
met.

 

Section 8.09.                             Trustee Eligibility.

 

There shall at all times be a Trustee
hereunder which shall be eligible to act as trustee under TIA Section 310(a) and
which shall have a combined capital and surplus of at least $50,000,000, to the
extent there is an institution eligible and willing to serve.  If such Trustee publishes reports of
condition at least annually, pursuant to law or to the requirements of federal,
state, territorial or District of Columbia supervising or examining authority,
then for the purposes of this Section 8.09, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.  If at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section 8.09, the
Trustee shall resign immediately in the manner and with the effect hereinafter
specified in this Article 8.

 

Section 8.10.                             Resignation and Removal;
Appointment of Successor Trustee.

 

(a)                                  No resignation or removal of
the Trustee and no appointment of a successor trustee pursuant to this Article 8
shall become effective until the acceptance of appointment by the successor
trustee under Section 8.11.

 

(b)                                 The Trustee, or any trustee
or trustees hereafter appointed, may at any time resign by giving written
notice thereof to the Company.  Such
resignation shall take effect upon the appointment of a successor Trustee and
the acceptance of such appointment by such successor Trustee.  If the instrument of acceptance by a
successor Trustee required by Section 8.11 shall not have been delivered
to the Trustee within 30 days after the giving of such notice of resignation or
of any removal of the Trustee as hereinafter provided, the resigning or removed

 

64

 

Trustee may at the Company’s expense petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities.

 

(c)                                  The Trustee may be removed
at any time for any cause or for no cause by an Act of the Holders of not less
than a majority in aggregate principal amount of the Outstanding Securities,
delivered to the Trustee and to the Company.

 

(d)                                 If at any time:

 

(1)                                  the Trustee
shall fail to comply with the provisions of TIA Section 310(b) after
written request therefor by the Company or by any Holder who has been a bona
fide Holder of a Security for at least six months,

 

(2)                                  the Trustee
shall cease to be eligible under Section 8.09 and shall fail to resign
after written request therefor by the Company or by any Holder who has been a
bona fide Holder of a Security for at least six months, or

 

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

 

then, in any case, (i) the Company may
remove the Trustee, or (ii) subject to Section 7.14, the Holder of
any Security who has been a bona fide Holder of a Security for at least six
months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor trustee.  Such
court may thereupon, after such notice, if any, as it may deem proper and
prescribe, remove the Trustee and appoint a successor trustee.

 

(e)                                  If the Trustee shall be
removed or become incapable of acting, or if a vacancy shall occur in the
office of Trustee for any cause, the Company shall promptly appoint a successor
trustee and shall comply with the applicable requirements of Section 8.11.  If, within 60 days after such removal or
incapability, or the occurrence of such vacancy, the Company has not appointed
a successor Trustee, a successor trustee shall be appointed by the Act of the
Holders of a majority in principal amount of the Outstanding Securities
delivered to the Company and the retiring Trustee.  Such successor trustee so appointed shall
forthwith upon its acceptance of such appointment become the successor
trustee.  If no successor trustee shall
have been so appointed by the Company or the Holders of the Securities and
accepted appointment in the manner hereinafter provided, the Trustee or the
Holder of any Security who has been a bona fide Holder for at least six months
may, subject to Section 7.14, on behalf of himself and all others
similarly situated, petition at the expense of the Company any court of
competent jurisdiction for the appointment of a successor trustee.

 

(f)                                    The Company shall give
notice of each resignation and each removal of the Trustee and each appointment
of a successor trustee by mailing written notice of such event by first-class
mail, postage prepaid, to the Holders of Securities as their names and
addresses appear in the register of the Registrar.  Each notice shall include the name of the
successor trustee and the address of its Corporate Trust Office or agent
hereunder.

 

65

 

Section 8.11.                             Acceptance of Appointment by
Successor.

 

(a)                                  Every successor trustee
appointed hereunder shall execute, acknowledge and deliver to the Company and
to the retiring Trustee an instrument accepting such appointment, and thereupon
the resignation or removal of the retiring Trustee shall become effective and
such successor trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of the retiring
Trustee as if originally named as Trustee hereunder; but, nevertheless, on the
written request of the Company or the successor trustee, upon payment of its
charges pursuant to Section 8.07 then unpaid, such retiring Trustee shall
pay over to the successor trustee all moneys at the time held by it hereunder,
subject nevertheless to its lien provided for in Section 8.07, and shall
execute and deliver an instrument transferring to such successor trustee all
such rights, powers, trusts and duties. 
Upon request of any such successor trustee, the Company shall execute
any and all instruments for more fully and certainly vesting in and confirming
to such successor trustee all such rights and powers.

 

(b)                                 No successor trustee with
respect to the Securities shall accept appointment as provided in this Section 8.11
unless at the time of such acceptance such successor trustee shall be eligible
to act as trustee under the provisions of TIA Section 310(a) and this
Article 8 and shall have a combined capital and surplus of at least
$50,000,000 and have a Corporate Trust Office or an agent selected in
accordance with Section 8.09.

 

(c)                                  Upon acceptance of
appointment by any successor trustee as provided in this Section 8.11, the
Company shall give notice thereof to the Holders of the Securities, by mailing
such notice to such Holders at their addresses as they shall appear on the
Security Register.  If the acceptance of
appointment is substantially contemporaneous with the appointment, then the
notice called for by the preceding sentence may be combined with the notice
called for by Section 8.10.  If the
Company fails to give such notice within 10 days after acceptance of
appointment by the successor trustee, the successor trustee shall cause such
notice to be given at the expense of the Company.

 

Section 8.12.                             Merger, Conversion,
Consolidation or Succession to Business.

 

Any Person into which the Trustee may be
merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which the Trustee
shall be a party, or any Person succeeding to all or substantially all of the
corporate trust business of the Trustee (including the trust created by this
Indenture) shall be the successor of the Trustee hereunder, provided that such Person shall be eligible under TIA Section 310(a) and
this Article 8 and shall have a combined capital and surplus of at least
$50,000,000 and have a Corporate Trust Office or an agent selected in
accordance with Section 8.09, without the execution or filing of any paper
or any further act on the part of any of the parties hereto.

 

In case at the time such successor to the
Trustee shall succeed to the trusts created by this Indenture any of the
Securities shall have been authenticated but not delivered, any such successor
to the Trustee may adopt the certificate of authentication of any predecessor
Trustee and deliver such Securities so authenticated; and, in case at that time
any of the Securities shall not have been authenticated, any successor to the
Trustee may authenticate such Securities either in the name of any predecessor
hereunder or in the name of the successor trustee; and in all such 

 

66

 

cases such certificate shall
have the full force which it is anywhere in the Securities or in this Indenture
provided that the certificate of the Trustee shall have; provided that the
right to adopt the certificate of authentication of any predecessor Trustee or
to authenticate Securities in the name of any predecessor Trustee shall apply only
to its successor or successors by merger, conversion or consolidation.

 

Section 8.13.                             Preferential Collection of
Claims Against Company.

 

If and when the Trustee shall be or become a
creditor of the Company (or other obligor under the Securities), the Trustee
shall be subject to the provisions of the TIA regarding the collection of
claims against the Company (or any such other obligor).  A Trustee who has resigned or been removed
shall be subject to TIA Section 311(a) to the extent indicated
therein.

 

Section 8.14.                             Reports By Trustee.

 

(a)                                  Within 60 days after May 15
of each year commencing with the first May 15 after the issuance of
Securities, the Trustee, if so required under the TIA, shall transmit by mail
to all Holders, in the manner and to the extent provided in TIA Section 313(c),
a brief report dated as of such May 15 in accordance with and with respect
to the matters required by TIA Section 313(a).  The Trustee shall also transmit by mail to
all Holders, in the manner and to the extent provided in TIA Section 313(c),
a brief report in accordance with and with respect to the matters required by
TIA Section 313(b)(2).

 

(b)                                 A copy of each report
transmitted to Holders pursuant to this Section 8.14 shall, at the time of
such transmission, be mailed to the Company and filed with each national
securities exchange, if any, upon which the Securities are listed and also with
the SEC.  The Company will notify the
Trustee promptly if the Securities are listed on any national securities
exchange and of any delisting thereof.

 

ARTICLE 9

 

SATISFACTION AND DISCHARGE OF INDENTURE

 

Section 9.01.                             Satisfaction and Discharge
of Indenture.

 

(a)                                  This Indenture shall cease
to be of further force and effect (except as to any surviving rights of
conversion, registration of transfer or exchange of Securities herein expressly
provided for and except as further provided below), and the Trustee, on demand
of and at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture, when either:

 

(1)                                  all Securities
theretofore authenticated and delivered (other than (i) Securities which
have been destroyed, lost or stolen and which have been replaced or paid as
provided in Section 2.08 and (ii) Securities for whose payment money
has theretofore been deposited in trust and thereafter repaid to the Company as
provided in Section 2.04) have been delivered to the Trustee for
cancellation; or

 

67

 

(2)                                  all such
Securities not theretofore delivered to the Trustee for cancellation have
become due and payable, whether on the Final Maturity Date, any Redemption Date
or a Fundamental Change Purchase Date, upon conversion or otherwise,

 

provided, that

 

(i)                                      the Company has
deposited with the Trustee, a Paying Agent (other than the Company or any of
its Affiliates) or a Conversion Agent, if applicable, immediately available
funds and/or shares of Common Stock, if applicable, in trust for the purpose of
and in an amount sufficient to pay and discharge all indebtedness and
obligations related to such Securities not theretofore delivered to the Trustee
for cancellation, for principal and interest (including Special Interest, if
any) to the date of such deposit and/or for the payment of amounts due upon
conversion;

 

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

 

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

 

(b)                                 Notwithstanding the
satisfaction and discharge of this Indenture, the obligations of the Company
with respect to the Trustee under Section 8.07 and, if money shall have
been deposited with the Trustee pursuant to clause (2) of Section 9.01(a),
the provisions of Sections 2.03, 2.04, 2.05, 2.06, 2.07, 2.08, 2.13 and
5.01 and this Article 9 shall survive until the Securities have been paid
in full.

 

Section 9.02.                             Application of Trust Money.

 

Subject to the provisions of the last
paragraph of Section 2.04, all United States dollars deposited with the
Trustee pursuant to Section 9.01 shall be held in trust and applied by it,
in accordance with the provisions of the Securities and this Indenture, to the
payment, either directly or through any Paying Agent as the Trustee may
determine, to the Persons entitled thereto, of the principal of and interest
(including the Company acting as its own Paying Agent) on, the Securities for
whose payment such United States dollars have been deposited with the Trustee.

 

Section 9.03.                             Reinstatement.

 

If the Trustee, any Paying Agent or any
Conversion Agent is unable to apply any money in accordance with Section 9.02
by reason of any legal proceeding or by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, then the Company’s obligations under this Indenture and the
Securities shall be revived and reinstated as though no deposit had occurred
pursuant to Section 9.01 until such time as the Trustee, such Paying Agent
or such Conversion Agent is permitted to apply all such money in accordance
with Section 9.02; provided, however, that if the Company has made any 

 

68

 

payment of the principal of
or interest (including Special Interest, if any) on any Securities because of
the reinstatement of its obligations, the Company shall be subrogated to the
rights of the Holders of such Securities to receive any such payment from the
money held by the Trustee, such Paying Agent or such Conversion Agent.

 

ARTICLE 10

 

AMENDMENTS; SUPPLEMENTS AND WAIVERS

 

Section 10.01.                       Without Consent
of Holders.

 

(a)                                  The Company, the Subsidiary
Guarantors and the Trustee may amend or supplement this Indenture or the
Securities without notice to or consent of any Holder of a Security for the
purpose of:

 

(1)                                  evidencing the
succession of another corporation to the Company or any Subsidiary Guarantor
and the assumption by that successor corporation of the Company’s or such
Subsidiary Guarantor’s obligations under this Indenture and the Securities;

 

(2)                                  adding to the
covenants of the Company and the Subsidiary Guarantors or add any rights for
the benefit of the Holders or surrendering any right or power conferred upon
the Company;

 

(3)                                  securing the
obligations of the Company and the Subsidiary Guarantors or adding Guarantees
in respect of the Securities;

 

(4)                                  evidencing and
providing for the acceptance of the appointment of a successor trustee in
accordance with Article 8;

 

(5)                                  complying with
the requirements of the SEC in order to effect or maintain the qualification of
this Indenture under the TIA;

 

(6)                                  providing for
conversion rights of Holders if any reclassification or change of Common Stock
or any consolidation, merger or sale of all or substantially all of the Company’s
property and assets occurs or otherwise complying with the provisions of this
Indenture in the event of a merger, consolidation or transfer of assets
(including the provisions of Section 4.10 and Article 6);

 

(7)                                  establishing
the forms or terms of the Securities;

 

(8)                                  curing any
ambiguity, omission, defect or inconsistency in the Indenture, correcting or
supplementing any provision in the Indenture, or making any other provisions
with respect to matters or questions arising under the Indenture, so long as
the interests of Holders of Securities are not adversely affected in any
material respect under  this Indenture;

 

(9)                                  to conform the
provisions of the Indenture or the Securities to the corresponding description
of the Securities contained in the applicable prospectus; or

 

69

 

(10)                            making any
change that will not adversely affect the rights of the Holders in any material
respect.

 

Section 10.02.                       With Consent of
Holders.

 

(a)                                  The Company, the Subsidiary
Guarantors and the Trustee may amend or supplement this Indenture and the
Securities with the consent of the Holders of at least a majority in aggregate
principal amount of the Outstanding Securities. 
However, without the written consent of each Holder affected, an
amendment or supplement may not:

 

(1)                                  change the
Stated Maturity of any payment of principal of or any installment of interest
on any Security (including the payment of Special Interest, if any);

 

(2)                                  reduce the
principal amount of Securities or alter the manner or rate of accrual of
interest (including Special Interest) on the Securities;

 

(3)                                  reduce
Redemption Price, Fundamental Change Purchase Price payable with respect to any
of the Securities;

 

(4)                                  change the
Company’s obligation to redeem any Security on a Redemption Date in a manner
adverse to such Holder;

 

(5)                                  change the
Company’s obligation to repurchase any Security upon a Fundamental Change in a
manner adverse to such Holder;

 

(6)                                  change any
place of payment where, or the currency in which, any principal or interest
(including Special Interest) in respect of any Security is payable;

 

(7)                                  make any change
that adversely affects the conversation rights of any Holder of Securities;

 

(8)                                  impair the
right of any Holder of a Security to receive payment of principal and interest
(including any Special Interest) on such Holders’ Securities when due;

 

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

 

(10)                            reduce the
percentage in principal amount of the Securities, the consent of whose Holders
is required to amend or supplement this Indenture or the Securities, or the
consent of whose Holders is required for any waiver of compliance with various
provisions of this Indenture or the Securities or various defaults thereunder
and their consequences provided for in the Indenture;

 

(11)                            modify any of
the foregoing provisions described in clause (11) above except to increase any
such percentage or to provide that other provisions of this Indenture or the
Securities cannot be modified or waived without the consent of the Holder of
each outstanding Security affected thereby; or

 

70

 

(12)                            release any
Subsidiary Guarantor from its Note Guarantee, except as provided in this
Indenture.

 

(b)                                 Without limiting the
provisions of Section 10.02(a) hereof, the Holders of a majority in
aggregate principal amount of the Securities then outstanding may, on behalf of
all the Holders of all Securities, (i) waive compliance by the Company
with the restrictive provisions of this Indenture, and (ii) waive any past
Default or Event of Default under this Indenture and its consequences, except
an uncured failure to pay any amounts due or to deliver amounts due upon
conversion, with respect to the Securities, or in respect of any provision
which under this Indenture cannot be modified or amended without the consent of
the Holder of each outstanding Security affected.

 

(c)                                  Upon delivery to the Trustee
of a Company Request, and upon the filing with the Trustee of evidence of the
consent of Holders as aforesaid, if required, the Trustee shall, subject to Section 10.03,
join with the Company in the execution of such supplemental indenture.

 

(d)                                 It shall not be necessary
for any Act of Holders under this Section 10.02 to approve the particular
form of any proposed supplemental indenture but it shall be sufficient if such
Act shall approve the substance thereof.

 

Section 10.03.                       Execution of
Supplemental Indentures and Agreements.

 

In executing, or accepting the additional
trusts created by, any supplemental indenture, agreement, instrument or waiver
permitted by this Article 10 or the modifications thereby of the trusts
created by this Indenture, the Trustee shall be entitled to receive, in
addition to the documents required by Section 12.04, and (subject to Section 8.01
and Section 8.03(a) hereof) shall be fully protected in relying upon,
an Opinion of Counsel and an Officer’s Certificate each stating that the
execution of such supplemental indenture, agreement or instrument, or
acceptance of any such additional trust, is authorized or permitted by this
Indenture.  The Trustee may, but shall
not be obligated to, enter into any such supplemental indenture, agreement or
instrument, or accept any such additional trusts, which affects the Trustee’s
own rights, duties or immunities under this Indenture or otherwise.

 

Section 10.04.                       Effect of
Supplemental Indentures.

 

Upon the execution of any supplemental
indenture under this Article 10, this Indenture shall be modified in
accordance therewith, and such supplemental indenture shall form a part of this
Indenture for all purposes; and every Holder of Securities theretofore or
thereafter authenticated and delivered hereunder shall be bound thereby.

 

Section 10.05.                       Conformity with
Trust Indenture Act.

 

Every supplemental indenture executed
pursuant to this Article 10 shall conform to the requirements of the TIA
as then in effect.

 

71

 

Section 10.06.                       Reference in
Securities to Supplemental Indentures.

 

Securities authenticated and delivered after
the execution of any supplemental indenture pursuant to this Article 10
may, and shall if required by the Trustee, bear a notation in form approved by
the Trustee as to any matter provided for in such supplemental indenture.  If the Company shall so determine, new
Securities so modified as to conform, in the opinion of the Trustee and the
Board of Directors, to any such supplemental indenture may be prepared and
executed by the Company and authenticated and delivered by the Trustee in
exchange for Outstanding Securities.

 

Section 10.07.                       Notice of
Supplemental Indentures.

 

Promptly after the execution by the Company
and the Trustee of any supplemental indenture pursuant to the provisions of Section 10.02,
the Company shall give notice thereof to the Holders of each Outstanding
Security affected, in the manner provided for in Section 12.02, setting
forth in general terms the substance of such supplemental indenture.  Any failure of the Company to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such supplemental indenture.

 

ARTICLE 11

 

GUARANTEE OF SECURITIES

 

Section 11.01.                       Note Guarantee.

 

Subject to the provisions of this Article Eleven, each Subsidiary
Guarantor hereby, jointly and severally, fully and unconditionally Guarantees
to each Holder of Securities hereunder and to the Trustee on behalf of the
Holders:  (i) the due and punctual
payment of the principal of, premium, if any, on and interest on each Security,
when and as the same shall become due and payable, whether at maturity, by
acceleration or otherwise, the due and punctual payment of interest on the
overdue principal of and interest, if any, on the Securities, to the extent
lawful, and the due and punctual performance of all other obligations of the
Company to the Holders or the Trustee, all in accordance with the terms of such
Security and this Indenture and (ii) in the case of any extension of time
of payment or renewal of any Securities or any of such other obligations, that
the same will be promptly paid in full when due or performed  in accordance with the terms of the extension
or renewal, at Stated Maturity, by acceleration or otherwise, subject, however, in the case of clauses (i) and (ii) above,
to the limitations set forth in the next succeeding paragraph.

 

Each Subsidiary Guarantor and by its
acceptance hereof each Holder hereby confirms that it is the intention of all
such parties that the Guarantee by any Subsidiary Guarantor pursuant to its
Note Guarantee not constitute a fraudulent transfer or conveyance for purposes
of the United States Bankruptcy Code, the Uniform Fraudulent Conveyance Act,
the Uniform Fraudulent Transfer Act or any similar Federal or state law.  To effectuate the foregoing intention, the
Holders and each Subsidiary Guarantor hereby irrevocably agree that the
obligations of each Subsidiary Guarantor under its Note Guarantee shall be
limited to the maximum amount as will, after giving effect to all other
contingent and fixed liabilities of each 

 

72

 

Subsidiary Guarantor and
after giving effect to any collections from or payments made by or on behalf of
any other Subsidiary Guarantor in respect of the obligations of such other
Subsidiary Guarantor under its Note Guarantee or pursuant to the following paragraph,
result in the obligations of such Subsidiary Guarantor under its Note Guarantee
not constituting such fraudulent transfer or conveyance.

 

In order to provide for just and equitable
contribution among the Subsidiary Guarantors, the Subsidiary Guarantors agree, inter se, that in the event any payment or
distribution is made by any Subsidiary Guarantor (a “Funding Guarantor”)
under its Note Guarantee, such Funding Guarantor shall be entitled to a
contribution from all other Subsidiary Guarantors in a pro rata amount based on the Adjusted Net
Assets of each Subsidiary Guarantor (including the Funding Guarantor) for all
payments, damages and expenses incurred by that Funding Guarantor in
discharging the Company’s obligations with respect to the Securities or any
other Subsidiary Guarantor’s obligations with respect to its Note
Guarantee.  “Adjusted Net Assets”
of such Subsidiary Guarantor at any date shall mean the lesser of the amount by
which (x) the fair value of the property of such Subsidiary Guarantor
exceeds the total amount of liabilities, including, without limitation,
contingent liabilities (after giving effect to all other fixed and contingent
liabilities incurred or assumed on such date), but excluding liabilities under
the Note Guarantee, of such Guarantor at such date and (y) the present
fair salable value of the assets of such Subsidiary Guarantor at such date
exceeds the amount that will be required to pay the probable liability of such
Subsidiary Guarantor on its debts (after giving effect to all other fixed and
contingent liabilities incurred or assumed on such date and after giving effect
to any collection from any Subsidiary of such Subsidiary Guarantor in respect
of the obligations of such Subsidiary under the Note Guarantee of such Subsidiary
Guarantor), excluding debt in respect of its Note Guarantee of such Subsidiary
Guarantor), excluding debt in respect of its Note Guarantee, as they become
absolute and matured.

 

Each Subsidiary Guarantor hereby waives
diligence, presentment, demand of payment, filing of claims with a court in the
event of merger or bankruptcy of the Company, any right to require a proceeding
first against the Company, the benefit of discussion, protest or notice with
respect to any such Security or the debt evidenced thereby and all demands
whatsoever (except as specified above), and covenants that this Note Guarantee
will not be discharged as to any such Security except by payment in full of the
principal thereof and interest thereon and as provided in Section 9.01. In
the event of any declaration of acceleration of such obligations as provided in
Article Seven, such obligations (whether or not due and payable) shall
forthwith become due and payable by each Subsidiary Guarantor for the purposes
of this Article Eleven.  In
addition, without limiting the foregoing provisions, upon the effectiveness of
an acceleration under Article Seven, the Trustee shall promptly make a
demand for payment on the Securities under the Note Guarantee provided for in
this Article Eleven.

 

The obligations of each Subsidiary Guarantor
under its Note Guarantee are independent of the obligations Guaranteed by the
Subsidiary Guarantor hereunder, and a separate action or actions may be brought
and prosecuted by the Trustee on behalf of, or by, the Holders, subject to the
terms and conditions set forth in this Indenture, against any Subsidiary
Guarantor to enforce this Note Guarantee, irrespective of whether any action is
brought against the Company or whether the Company is joined in any such action
or actions.

 

73

 

If the Trustee or the Holder is required by
any court or otherwise to return to the Company or any Subsidiary Guarantor, or
any custodian, receiver, liquidator, trustee, sequestrator or other similar
official acting in relation to Company or any Subsidiary Guarantor, any amount
paid to the Trustee or such Holder in respect of a Security, this Note
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect.  Each Subsidiary
Guarantor further agrees, to the fullest extent that it may lawfully do so,
that, as between it, on the one hand, and the Holders and the Trustee, on the
other hand, the maturity of the obligations Guaranteed hereby may be
accelerated as provided in Article Seven hereof for the purposes of this
Note Guarantee, notwithstanding any stay, injunction or other prohibition
extant under any applicable bankruptcy law preventing such acceleration in
respect of the obligations Guaranteed hereby.

 

Each Subsidiary Guarantor hereby irrevocably
waives any claim or other rights which it may now or hereafter acquire against
the Company or any other Subsidiary Guarantor that arise from the existence,
payment, performance or enforcement of its obligations under this Note
Guarantee and this Indenture, including, without limitation, any right of
subrogation, reimbursement, exoneration, contribution, indemnification, any
right to participate in any claim or remedy of the Holders against the Company
or any Subsidiary Guarantor or any collateral which any such Holder or the
Trustee on behalf of such Holder hereafter acquires, whether or not such claim,
remedy or right arises in equity, or under contract, statute or common law,
including, without limitation, the right to take or receive from the Company or
a Subsidiary Guarantor, directly or indirectly, in cash or other property or by
set-off or in any other manner, payment or security on account of such claim or
other rights.  If any amount shall be
paid to a Subsidiary Guarantor in violation of the preceding sentence and the
principal of, premium, if any, and accrued interest on the Securities shall not
have been paid in full, such amount shall be deemed to have been paid to such
Subsidiary Guarantor for the benefit of, and held in trust for the benefit of,
the Holders, and shall forthwith be paid to the Trustee for the benefit of the
Holders to be credited and applied upon the principal of, premium, if any, and
accrued interest on the Securities.  Each
Subsidiary Guarantor acknowledges that it will receive direct and indirect
benefits from the issuance of the Securities pursuant to this Indenture and
that the waivers set forth in this Section 11.01 are knowingly made in
contemplation of such benefits.

 

The Note Guarantee set forth in this Section 11.01
shall not be valid or become obligatory for any purpose with respect to a
Security until the certificate of authentication on such Security shall have
been signed by or on behalf of the Trustee.

 

Section 11.02.                       Obligations Unconditional.

 

Nothing contained in this Article Eleven or elsewhere in this
Indenture or in the Securities is intended to or shall impair, as among any
Subsidiary Guarantor and the holders of the Securities, the obligation of such
Subsidiary Guarantor, which is absolute and unconditional, upon failure by the
Company to pay to the holders of the Securities the principal of, 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 and creditors of such Subsidiary Guarantor, nor
shall anything herein or therein prevent any Holder or the Trustee on their
behalf from exercising all remedies otherwise permitted by applicable law upon
default under this Indenture.

 

74

 

Without limiting the foregoing, nothing
contained in this Article Eleven will restrict the right of the Trustee or
the Holders to take any action to declare the Note Guarantee to be due and
payable prior to the Stated Maturity of any Securities pursuant to Section 7.02
or to pursue any rights or remedies hereunder.

 

Section 11.03.                       Release of Note Guarantees.

 

The Note Guarantee of any Subsidiary Guarantor will be automatically
and unconditionally released and discharged upon:

 

(i)                                     the
satisfaction and discharge of this Indenture in accordance with the terms of
this Indenture;

 

(ii)                                  the sale,
exchange or transfer (including by way of merger or consolidation) to any
Person or Persons (other than an Affiliate or Affiliates of the Company) of all
of the Capital Stock of such Subsidiary Guarantor; or

 

(iii)                               the release and
discharge of the Guarantee by such Subsidiary Guarantor which resulted in the
obligation to Guarantee the Securities (including, in the case of an Initial
Subsidiary Guarantor, the release and discharge of all Guarantees by such
Initial Subsidiary Guarantor of the Company’s obligations under the Company’s
debt securities and the Credit Agreement outstanding on the Closing Date), provided that such Subsidiary Guarantor has not Guaranteed
any other Indebtedness of the Company which would have resulted in an
obligation to Guarantee the Securities and such other Guarantee has not also
been unconditionally released and discharged.

 

At the request of the Company and upon being
provided an Officer’s Certificate and an Opinion of Counsel complying with Section 12.04,
the Trustee shall execute and deliver an appropriate instrument evidencing such
release.

 

Section 11.04.                       Notice to Trustee.

 

Each Subsidiary Guarantor shall give prompt written notice to the
Trustee of any fact known to such Subsidiary Guarantor which would prohibit the
making of any payment to or by the Trustee in respect of the Note Guarantee pursuant
to the provisions of this Article Eleven.

 

Section 11.05.                       This Article Not to Prevent Events
of Default.

 

The failure to make a payment on account of principal of, premium, if
any, or interest on the Securities by reason of any provision of this Article Eleven
will not be construed as preventing the occurrence of an Event of Default.

 

75

 

ARTICLE 12

 

MISCELLANEOUS

 

Section 12.01.                       Conflict with
Trust Indenture Act.

 

If any provision hereof
limits, qualifies or conflicts with any provision of the TIA or another
provision which is required or deemed to be included in this Indenture by any
of the provisions of the TIA, the provision or requirement of the TIA shall
control.  If any provision of this
Indenture modifies or excludes any provision of the TIA that may be so modified
or excluded, the latter provision shall be deemed to apply to this Indenture as
so modified or to be excluded, as the case may be.

 

Section 12.02.                       Notices.

 

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

 

If to the Company, to:

 

Steel Dynamics, Inc. 

6714 Pointe Inverness Way, Suite 200

Fort Wayne, IN 46804

Facsimile (260) 969-3587

Attention: Theresa Wagler

 

or at any other address previously furnished
in writing to the Trustee by the Company, with a copy to:

 

Barrett & McNagny LLP

215 East Berry Street

Fort Wayne, IN 46802,

Facsimile: (260) 423-8920

Attention: Robert Walters

 

if to the Trustee, to:

 

Wells Fargo Bank, National Association

230 West Monroe Street, Suite 2900

Chicago, IL 60606

Telecopier No.: (312) 726-2158 

Attention: Corporate Trust Services

 

or at any other address previously furnished
in writing to the Holders or the Company or any other obligor on the Securities
by the Trustee.

 

76

 

Such notices or communications
shall be effective only when actually received.

 

The Company or the Trustee
by notice to the other may designate additional or different addresses for
subsequent notices or communications.

 

Where this Indenture
provides for notice to Holders of any event, such notice shall be sufficiently
given (unless otherwise herein expressly provided) if in writing and mailed,
first-class postage prepaid, or delivered by recognized overnight courier, to
each Holder affected by such event, at its address as it appears in the
register kept by the Primary Registrar, not later than the latest date, and not
earlier than the earliest date, prescribed for the giving of such notice or by
any other manner deemed acceptable to the Trustee.  In any case where notice to Holders is given
by mail, neither the failure to mail such notice, nor any defect in any notice
so mailed, to any particular Holder shall affect the sufficiency of such notice
with respect to other Holders.  Any
notice when mailed to a Holder in the aforesaid manner shall be conclusively
deemed to have been received by such Holder whether or not actually received by
such Holder.  Where this Indenture
provides for notice in any manner, such notice may be waived in writing by the
Person entitled to receive such notice, either before or after the event, and
such waiver shall be the equivalent of such notice.  Waivers of notice by Holders shall be filed
with the Trustee, but such filing shall not be a condition precedent to the validity
of any action taken in reliance upon such waiver.

 

In case by reason of the
suspension of regular mail service or by reason of any other cause, it shall be
impracticable to mail notice of any event as required by any provision of this
Indenture, then any method of giving such notice as shall be reasonably
satisfactory to the Trustee shall be deemed to be a sufficient giving of such
notice.

 

If the Company mails any
notice to a Holder of a Security, it shall mail a copy to the Trustee and each
Registrar, Paying Agent and Conversion Agent.

 

Section 12.03.                       Disclosure of
Names and Addresses of Holders.

 

Holders may communicate
pursuant to TIA Section 312(b) with other Holders with respect to
their rights under this Indenture or the Securities, and the Trustee shall
comply with TIA Section 312(b).  The
Company, the Trustee, the Registrar and any other Person shall have the
protection of TIA 312(c).  Further, every
Holder of Securities, by receiving and holding the same, agrees with the
Company and the Trustee that neither the Company nor the Trustee or any agent
of either of them shall be held accountable by reason of the disclosure of any
information as to the names and addresses of the Holders in accordance with TIA
Section 312, regardless of the source from which such information was
derived, and that the Trustee shall not be held accountable by reason of
mailing any material pursuant to a request made under TIA Section 312.

 

Section 12.04.                       Compliance
Certificates and Opinions.

 

(a)                                  Upon any
application or request by the Company to the Trustee to take any action under
any provision of this Indenture and as may be requested by the Trustee, the
Company shall furnish to the Trustee an Officer’s Certificate stating that all
conditions precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with, and an 

 

77

 

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 certificates or opinions is specifically
required by any provision of this Indenture relating to such particular
application or request, no additional certificate or opinion need be furnished.

 

(b)                                 Every
certificate or Opinion of Counsel with respect to compliance with a condition
or covenant provided for in this Indenture shall include:

 

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

 

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

 

(3)                                  a statement that, in the
opinion of such Person, such Person has made such examination or investigation
as is necessary to enable such Person 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 such Person, such condition or covenant has been complied
with.

 

Section 12.05.                       Acts of Holders.

 

(a)                                  Any request,
demand, authorization, direction, notice, consent, waiver or other action
provided by this Indenture to be given or taken by Holders may be embodied in
and evidenced by one or more instruments of substantially similar tenor signed
by such Holders in person or by an agent duly appointed in writing; and, except
as herein otherwise expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Trustee and, where it is
hereby expressly required, to the Company. 
Such instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the “Act” of the Holders signing
such instrument or instruments.  Proof of
execution of any such instrument or of a writing appointing any such agent
shall be sufficient for any purpose of this Indenture and conclusive in favor
of the Trustee and the Company, if made in the manner provided in this Section 12.05.

 

(b)                                 The ownership
of Securities shall be proved by the register maintained by the Primary
Registrar.

 

(c)                                  Any request,
demand, authorization, direction, notice, consent, waiver or other Act by the
Holder of any Security shall bind every future Holder of the same Security and
the Holder of every Security issued upon the transfer thereof or in exchange
therefor or in lieu thereof, in respect of anything done, suffered or omitted
to be done by the Trustee, any Paying Agent or Conversion Agent, or the Company
or any other obligor of the Securities in reliance thereon, whether or not
notation of such action is made upon such Security.

 

78

 

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

 

(e)                                  If the Company
shall solicit from the Holders any request, demand, authorization, direction,
notice, consent, waiver or other Act, the Company may, at its option, by or
pursuant to a Board Resolution, fix in advance a record date for the
determination of such Holders entitled to give such request, demand,
authorization, direction, notice, consent, waiver or other Act, but the Company
shall have no obligation to do so. 
Notwithstanding TIA Section 316(c), any such record date shall be
the record date specified in or pursuant to such Board Resolution, which shall
be a date not more than 30 days prior to the first solicitation of Holders
generally in connection therewith and no later than the date such first
solicitation is completed.

 

(f)                                    If such a
record date is fixed, such request, demand, authorization, direction, notice,
consent, waiver or other Act may be given before or after such record date, but
only the Holders of record at the close of business on such record date shall
be deemed to be Holders for purposes of determining whether Holders of the
requisite proportion of Securities then Outstanding have authorized or agreed
or consented to such request, demand, authorization, direction, notice,
consent, waiver or other Act, and for this purpose the Securities then
Outstanding shall be computed as of such record date; provided that no such
request, demand, authorization, direction, notice, consent, waiver or other Act
by the Holders on such record date shall be deemed effective unless it shall
become effective pursuant to the provisions of this Indenture not later than
six months after such record date.

 

(g)                                 For purposes of
this Indenture, any action by the Holders which may be taken in writing may be
taken by electronic means or as otherwise reasonably acceptable to the Trustee.

 

Section 12.06.                       Benefits of
Indenture.

 

Nothing in this Indenture or
in the Securities, express or implied, shall give to any Person (other than the
parties hereto and their successors hereunder, any Paying Agent and the
Holders) any benefit or any legal or equitable right, remedy or claim under
this Indenture.

 

Section 12.07.                       Legal Holidays.

 

In any case where any
Interest Payment Date, Redemption Date, Fundamental Change Purchase Date or
Final Maturity Date of any Security shall not be a Business Day, then (notwithstanding
any other provision of this Indenture or of the Securities) payment of interest
or principal need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on such
Interest Payment Date, Redemption Date, Fundamental Change Purchase Date or
Final Maturity Date, and no interest shall accrue with respect to such payment
for the period from and after such Interest Payment Date, Redemption 

 

79

 

Date,
Fundamental Change Purchase Date or Final Maturity Date, as the case may be, to
the next succeeding Business Day.

 

Section 12.08.                       Governing Law;
Waiver of Trial by Jury.

 

THIS INDENTURE, THE
SECURITIES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK.

 

EACH PARTY HERETO, AND EACH
HOLDER OF A SECURITY BY ITS ACCEPTANCE THEREOF, HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS INDENTURE.

 

Section 12.09.                       No Adverse
Interpretation of Other Agreements.

 

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

 

Section 12.10.                       No Personal
Liability of Directors, Officers, Employees and Stockholders.

 

No director, officer,
employee, stockholder, incorporator or agent of the Company will have any
liability for any obligations of the Company under the Securities, the
Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation.  Each
Holder of the Securities by accepting a Security waives and releases all such
liability.

 

Section 12.11.                       Successors and
Assigns.

 

All covenants and agreements
in this Indenture by the parties hereto shall bind their respective successors
and assigns, whether so expressed or not.

 

Section 12.12.                       Multiple
Counterparts.

 

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

 

Section 12.13.                       Separability
Clause.

 

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

 

Section 12.14.                       Schedules and
Exhibits.

 

All schedules and exhibits
attached hereto are by this reference made a part hereof with the same effect
as if herein set forth in full.

 

80

 

Section 12.15.                       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.

 

[SIGNATURE PAGES FOLLOW]

 

81

 

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

 

 

	
   

  	
  STEEL DYNAMICS, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Theresa E. Wagler

  
	
   

  	
   

  	
  Name: Theresa E. Wagler

  
	
   

  	
   

  	
  Title: Executive Vice President and Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SDI
  INVESTMENT COMPANY

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  President

  
	
   

  	
   

  
	
   

  	
  NEW
  MILLENNIUM BUILDING SYSTEMS, LLC

  
	
   

  	
   

  
	
   

  	
  By:
  STEEL DYNAMICS, INC., its sole member

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  
	
   

  	
  STEEL
  DYNAMICS SALES NORTH AMERICA, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  
	
   

  	
  ROANOKE ELECTRIC STEEL
  CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Theresa E.
  Wagler

  
	
   

  	
   

  	
  Name: Theresa E. Wagler

  
	
   

  	
   

  	
  Title: Vice President

  

 

Steel Dynamics, Inc.

Indenture

 

 

	
   

  	
  JOHN W. HANCOCK, JR., LLC

  
	
   

  	
   

  
	
   

  	
  By: ROANOKE ELECTRIC STEEL
  CORPORATION, MANAGER AND SOLE MEMBER

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Theresa E.
  Wagler

  
	
   

  	
   

  	
  Name: Theresa E. Wagler

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
  NEW MILLENNIUM BUILDING
  SYSTEMS, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Theresa E.
  Wagler

  
	
   

  	
   

  	
  Name: Theresa E. Wagler

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
  SOCAR OF OHIO, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Theresa E.
  Wagler

  
	
   

  	
   

  	
  Name: Theresa E. Wagler

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
  STEEL OF WEST VIRGINIA,
  INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Theresa E.
  Wagler

  
	
   

  	
   

  	
  Name: Theresa E. Wagler

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
  SWVA, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Theresa E.
  Wagler

  
	
   

  	
   

  	
  Name: Theresa E. Wagler

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
  MARSHALL STEEL, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Theresa E.
  Wagler

  
	
   

  	
   

  	
  Name: Theresa E. Wagler

  
	
   

  	
   

  	
  Title: Vice President

  

 

Steel Dynamics, Inc.

Indenture

 

 

	
   

  	
  STEEL
  VENTURES, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  
	
   

  	
  SHREDDED
  PRODUCTS II, LLC

  
	
   

  	
   

  
	
   

  	
  By:
  STEEL DYNAMICS, INC., MANAGER AND SOLE MEMBER

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  THE
  TECHS INDUSTRIES, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  ADMETCO,
  INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  AUBURN
  INVESTMENT COMPANY, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:
  OMNISOURCE CORPORATION, SOLE MEMBER

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  

 

Steel Dynamics, Inc.

Indenture

 

 

	
   

  	
  CAPITOL
  CITY METALS, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:
  OMNISOURCE INDIANAPOLIS, SOLE MEMBER

  
	
   

  	
   

  	
   

  
	
   

  	
  BY:
  OMNISOURCE CORPORATION, SOLE MEMBER

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  GLOBAL
  SHREDDING TECHNOLOGIES, LTD., LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:
  OMNISOURCE CORPORATION, SOLE MEMBER

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  INDUSTRIAL
  SCRAP CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  INDUSTRIAL
  SCRAP, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  JACKSON
  IRON & METAL COMPANY, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  

 

Steel Dynamics, Inc.

Indenture

 

 

	
   

  	
  LUCKY
  STRIKE METALS, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:
  OMNISOURCE CORPORATION, SOLE MEMBER

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  MICHIGAN
  PROPERTIES ECORSE, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:
  OMNISOURCE CORPORATION, SOLE MEMBER

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  OMNISOURCE
  BAY CITY, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:
  JACKSON IRON & METAL COMPANY, INC., SOLE MEMBER

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  OMNISOURCE
  ATHENS DIVISION, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:
  OMNISOURCE CORPORATION, SOLE MEMBER

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  OMNISOURCE
  CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  

 

Steel Dynamics, Inc.

Indenture

 

 

	
   

  	
  OMNISOURCE
  INDIANAPOLIS, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:
  OMNISOURCE CORPORATION, SOLE MEMBER

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  OMNISOURCE
  MEXICO, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:
  OMNISOURCE CORPORATION, SOLE MEMBER

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  OMNISOURCE
  TRANSPORT, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:
  OMNISOURCE CORPORATION, SOLE MEMBER

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  OMNISOURCE,
  LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  RECOVERY
  TECHNOLOGIES, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:
  OMNISOURCE CORPORATION, SOLE MEMBER

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  

 

Steel Dynamics, Inc.

Indenture

 

 

	
   

  	
  SCIENTIFIC
  RECYCLING GROUP, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:
  OMNISOURCE CORPORATION, SOLE MEMBER

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  SUPERIOR
  ALUMINUM ALLOYS, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Name:
  Theresa E. Wagler

  
	
   

  	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  OMNISOURCE
  SOUTHEAST, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Theresa
  E. Wagler, Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  COHEN &
  GREEN SALVAGE CO., INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Theresa
  E. Wagler, Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  LUMBERTON
  RECYCLING COMPANY, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Theresa
  E. Wagler, Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  RAEFORD
  SALVAGE COMPANY, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Theresa
  E. Wagler, Vice President

  

 

Steel Dynamics, Inc.

Indenture

 

 

	
   

  	
  CAROLINAS
  RECYCLING GROUP, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  BY:
  OMNISOURCE SOUTHEAST, LLC, MANAGER AND SOLE MEMBER

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Theresa
  E. Wagler, Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  ATLANTIC
  SCRAP AND PROCESSING-WILMINGTON, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  BY:
  OMNISOURCE SOUTHEAST, LLC, MANAGER AND SOLE MEMBER

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Theresa E. Wagler

  
	
   

  	
   

  	
  Theresa
  E. Wagler, Vice President

  

 

Steel Dynamics, Inc.

Indenture

 

 

	
   

  	
  WELLS FARGO BANK, NATIONAL
  ASSOCIATION,

  
	
   

  	
  as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gregory S. Clarke

  
	
   

  	
   

  	
  Name: Gregory S. Clarke

  
	
   

  	
   

  	
  Title: Vice President

  

 

Steel Dynamics, Inc.

Indenture

 

 

Exhibit A

 

[FORM OF FACE OF
SECURITY]

 

UNLESS THIS CERTIFICATE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO.
OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN. 
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF.  THIS SECURITY IS
EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE AND, UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR
SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT
AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF
THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE
DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITARY.(1)

 

Steel Dynamics, Inc.

 

5.125% Convertible Senior
Notes due 2014

 

	
  No.  R-        

  	
  CUSIP: 858119 AP5

  

 

Steel Dynamics, Inc., a
Indiana corporation, promises to pay to Cede & Co. or registered
assigns the principal sum as set forth in the “Schedule of Exchanges of
Securities” attached hereto, which shall not exceed DOLLARS ($      ) on June 15, 2014.

 

This Security shall bear
interest as specified on the other side of this Security.  This Security is convertible as specified on
the other side of this Security.

 

SDI Investment Co., a Delaware corporation, Steel
Dynamics Sales North America, Inc., an Indiana corporation, New Millennium
Building Systems, LLC, an Indiana limited liability company, Roanoke Electric
Steel Corporation, an Indiana corporation, New Millennium Building Systems, Inc.,
a South Carolina corporation, Socar of Ohio, Inc., an Ohio corporation, Shredded
Products II, LLC, an Indiana limited liability company, John W. Hancock, Jr.,
LLC, a 

 

(1)           This paragraph should be included
only if the Security is a Global Security.

 

A-1

 

Virginia limited
liability company, Steel of West Virginia, Inc., a Delaware corporation,
Steel Ventures, Inc., a Delaware corporation, SWVA, Inc., a Delaware
corporation, Marshall Steel Inc., a Delaware corporation, The Techs Industries, Inc.,
a Delaware corporation, OmniSource Corporation, an Indiana corporation, Admetco, Inc.,
an Indiana corporation, Auburn Investment Company, LLC, an Indiana limited
liability company, Capitol City Metals, LLC, an Indiana limited liability
company, Global Shredding Technologies, Ltd., LLC, an Indiana limited liability
company, Industrial Scrap Corporation, an Indiana corporation, Industrial
Scrap, LLC, an Indiana limited liability company, Jackson Iron & Metal
Company, Inc., a Michigan corporation, Lucky Strike Metals, LLC, an
Indiana limited liability company, Michigan Properties Ecorse, LLC, an Indiana
limited liability company, OmniSource Athens Division, LLC, an Indiana limited
liability company, OmniSource Bay City, LLC, an Indiana limited liability
company, OmniSource Indianapolis, LLC, an Indiana limited liability company,
OmniSource, LLC, an Indiana limited liability company, OmniSource Mexico, LLC,
an Indiana limited liability company, OmniSource Transport, LLC, an Indiana
limited liability company, Recovery Technologies, LLC, an Indiana limited
liability company, Scientific Recycling Group, LLC, an Indiana limited
liability company, Superior Aluminum Alloys, LLC, an Indiana limited liability
company, and OmniSource Southeast, LLC, a Delaware limited
liability company, Carolinas Recycling Group, LLC, a South Carolina
limited liability company, Atlantic Scrap and Processing — Wilmington,
LLC, a North Carolina limited liability company, Cohen & Green
Salvage Co., Inc., a North Carolina corporation, Raeford Salvage Company, Inc.,
a North Carolina corporation, and Lumberton Recycling Company, Inc., a
North Carolina corporation, and any future Subsidiary Guarantors (collectively,
the “Subsidiary Guarantors,” which term includes any successors under the
Indenture hereinafter referred to and any Subsidiary that provides a Note
Guarantee pursuant to the Indenture), has fully and unconditionally guaranteed
the payment of principal of premium, if any, and interest on the Securities.

 

Additional provisions of
this Security are set forth on the other side of this Security.

 

A-2

 

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

 

	
   

  	
  STEEL DYNAMICS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated:

  	
   

  
	
   

  	
   

  
	
  Trustee’s Certificate of
  Authentication:

  	
   

  
	
   

  	
   

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

  	
   

  
	
   

  	
   

  
	
  Wells Fargo Bank, National
  Association, as Trustee

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  
					

 

A-3

 

[FORM OF REVERSE SIDE
OF SECURITY]

 

Steel Dynamics, Inc.

 

5.125% Convertible Senior
Notes due 2014

 

1.             Interest

 

Steel Dynamics, Inc., a
Indiana corporation (the “Company”, which term shall include any successor
company under the Indenture hereinafter referred to), promises to pay interest
on the principal amount of this Security at the rate of 5.125% per annum.  The Company shall pay interest semiannually,
in arrears, on June 15 and December 15 of each year (each an “Interest
Payment Date”), commencing on December 15, 2009.  Interest payable on any Interest Payment Date
shall include interest accrued from and including the immediately preceding
Interest Payment Date (or if none, from and including June 9, 2009) to but
excluding the relevant Interest Payment Date. 
Cash interest will be computed on the basis of a 360-day year comprised
of twelve 30-day months.  Any payment
required to be made on a day that is not a Business Day shall be made on the
next succeeding Business Day with the same force and effect as if made on such
day and without any interest in respect of the delay.  The Company shall, to the fullest extent
permitted by law, pay interest in immediately available funds on overdue
principal and interest at the rate of 5.125% per annum, compounded
semiannually, which interest shall accrue from the date such overdue amount was
originally due to the day preceding the date payment of such amount, including
interest thereon, has been made or duly provided for.

 

Any reference herein to
interest accrued or payable as of any date shall include any Special Interest
that may be payable in accordance with the provisions of Section 7.02 of
the Indenture.

 

2.             Method of Payment

 

The Company shall pay
interest on this Security (except defaulted interest) to the Person who is the
Holder of this Security at the close of business on June 1 or December 1,
as the case may be (each, a “Regular Record Date”) next preceding the related
Interest Payment Date.  The Holder must
surrender this Security to a Paying Agent to collect payment of principal.  The Company will pay principal and interest
in money of the United States that at the time of payment is legal tender for
payment of public and private debts.

 

3.             Paying Agent, Registrar and Conversion Agent

 

Initially, Wells Fargo Bank,
National Association (the “Trustee”, which term shall include any successor
trustee under the Indenture hereinafter referred to) will act as Paying Agent,
Registrar and Conversion Agent.  The
Company may change any Paying Agent, Registrar or Conversion Agent without
notice to the Holders.  The Company or
any of its Affiliates may, subject to certain limitations set forth in the
Indenture, act as Paying Agent.

 

A-4

 

4.             Indenture

 

This Security is one of a
duly authorized issue of Securities of the Company designated as its 5.125%
Convertible Senior Notes due 2014 (the “Securities”), issued under an
Indenture, dated as of June 9, 2009 (together with any supplemental
indentures thereto, the “Indenture”), among the Company, the Initial Subsidiary
Guarantors named therein and the Trustee. 
The terms of this Security include those stated in the Indenture and
those required by or made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (the “TIA”), as in effect on the date of the
Indenture.  This Security is subject to
all such terms, and the Holder of this Security is referred to the Indenture
and the TIA for a statement of them.  The
Securities are limited to $287,500,000 aggregate principal amount.  The Indenture does not limit other debt of
the Company, secured or unsecured.

 

Capitalized
terms not otherwise defined herein have the meaning ascribed to such terms in
the Indenture.

 

5.             Redemption

 

On
or after June 20, 2012, if the Last Reported Sale Price of the Company’s
Common Stock for 20 or more Trading Days (whether or not consecutive) in a
period of 30 consecutive Trading Days ending on the Trading Day prior to the
date the Company provides the notice of redemption to Holders exceeds 130% of
the applicable Conversion Price in effect on each such Trading Day, the Company
may redeem for cash all or part of the Securities, upon not less than 30 nor
more than 60 days’ notice before the Redemption Date to the Trustee, the Paying
Agent and each Holder of Securities at their last registered address, all as
provided in the Indenture; provided that
the Company shall not redeem the Securities if the Redemption Date would be
after the Final Maturity Date.  The
Redemption Price of a Security will be equal to 100% of the principal amount of
Securities being redeemed, plus accrued and unpaid interest (including Special
Interest, if any), to, but not including, the Redemption Date; provided that if the Redemption Date falls after a Regular
Record Date and on or prior to the corresponding Interest Payment Date, the
Redemption Price shall be 100% of the principal amount of the Securities
redeemed but shall not include accrued and unpaid interest (including Special
Interest, if any).  Instead, the Company
shall pay such accrued and unpaid interest (including Special Interest, if
any), if any, on the Interest Payment Date, to the Holder of record at the
close of business on the corresponding Regular Record Date.

 

6.             Purchase of Securities at Option of
Holder Upon a Fundamental Change

 

Upon a Fundamental Change,
at the option of the Holder and subject to the terms and conditions of the
Indenture, the Company shall become obligated to purchase for cash all or any
part specified by the Holder (so long as the principal amount of such part is
$1,000 or an integral multiple of $1,000) of the Securities held by such Holder
on the date specified by the Company in accordance with the provisions of Article 3
of the Indenture.

 

7.             Conversion

 

Subject to and upon
compliance with the provisions of the Indenture, the Holder may surrender for
conversion all or any portion of this Security that is in an integral multiple
of 

 

A-5

 

$1,000.  Upon conversion, the Holder shall be entitled
to receive the consideration specified in the Indenture.  No fractional share of Common Stock shall be
issued upon conversion of a Security. 
Instead, the Company shall pay a cash adjustment as provided in the
Indenture.  The initial Conversion Rate
of the Securities shall be 56.9801 shares of Common Stock per $1,000 principal
amount of Securities, subject to adjustment in accordance with the provisions
of Article 4 of the Indenture.  If a
Holder converts all or any portion of this Security in connection with the
occurrence of certain Fundamental Change transactions, the Conversion Rate
shall be increased in the manner and to the extent described in Section 4.06
of the Indenture.

 

Securities surrendered for
conversion (in whole or in part) during the period from the close of business
on any Regular Record Date to the opening of business on the next succeeding
Interest Payment Date shall be accompanied by payment by the Holders of such
Securities in funds to the Conversion Agent acceptable to the Company of an
amount equal to the interest payable on such corresponding Interest Payment
Date; provided that no such payment need be
made: (1) if the Company has called the Securities for redemption on a
Redemption Date that falls after a Regular Record Date for an Interest Payment
Date and on or prior to the corresponding Interest Payment Date; (2) in
connection with a conversion following the Regular Record Date preceding the
Final Maturity Date; (3) if the Company has specified a Fundamental Change
Purchase Date that is after a Regular Record Date and on or prior to the
corresponding Interest Payment Date; or (4) to the extent of any overdue
interest, if any overdue interest exists at the time of conversion with respect
to such Security.

 

A
Security in respect of which a Holder has submitted a Fundamental Change
Purchase Notice may be converted only if such Holder validly withdraws such
Fundamental Change Purchase Notice in accordance with the terms of the
Indenture.

 

8.             Denominations, Transfer, Exchange

 

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

 

9.             Persons Deemed Owners

 

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

 

10.          Unclaimed Money

 

If money for the payment of
principal or interest remains unclaimed for two years, the Trustee and any
Paying Agent will pay the money back to the Company, subject to the provisions
of the Indenture.  After that, Holders
entitled to money must look to the Company for payment as general creditors.

 

A-6

 

11.          Amendment, Supplement and Waiver

 

Subject to certain
exceptions, the Indenture or the Securities may be amended or supplemented with
the consent of the Holders of at least a majority in aggregate principal amount
of the Securities then Outstanding, and an existing Default or Event of Default
and its consequence or compliance with any provision of the Indenture or the
Securities may be waived subject to certain exceptions with the consent of the
Holders of a majority in aggregate principal amount of the Securities then
Outstanding.  Without the consent of or
notice to any Holder, the Company and the Trustee may amend or supplement the
Indenture or the Securities to, among other things, (x) cure any
ambiguity, omission, mistake, defect or inconsistency or (y) make any
other change that does not adversely affect the interests of the Holders in any
material respect.

 

12.          Successor Entity

 

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

 

13.          Defaults and Remedies

 

An Event of Default shall
occur upon the occurrence of any of the events specified in Section 7.01(a) of
the Indenture.  Subject to the provisions
of the penultimate paragraph of Section 7.02(c) of the Indenture, if
an Event of Default shall occur and be continuing with respect to the
Securities (other than an Event of Default specified in clause (10) or
(11) of Section 7.01(a) of the Indenture), the Trustee or the Holders
of not less than 25% in aggregate principal amount of the Securities then
Outstanding may declare all unpaid principal of and accrued interest (including
Special Interest), if any, on all Securities to be due and payable, by a notice
in writing to the Company (and to the Trustee if given by the Holders of the
Securities).  Upon any such declaration,
such principal and interest (including Special Interest), if any, shall become
due and payable immediately.  If an Event
of Default specified in clauses (10) or (11) of Section 7.01(a) of
the Indenture occurs and is continuing, then all the Securities shall ipso
facto become and be due and payable immediately in an amount equal to the
principal amount of the Securities, together with accrued and unpaid interest
(including Special Interest), if any, to the date the Securities become due and
payable, without any declaration or other act on the part of the Trustee or any
Holder.

 

The Holders of a majority in
aggregate principal amount of the Securities Outstanding, by written notice to
the Company and the Trustee, may rescind and annul an acceleration and its
consequences if:  (a) the Company
has paid or deposited with the Trustee a sum sufficient to pay (1) all
sums paid or advanced by the Trustee under the Indenture and the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, (2) all overdue interest on all Securities then Outstanding, (3) the
principal of any Securities then Outstanding which have become due otherwise
than by such declaration of acceleration and interest thereon at the rate borne
by the Securities, and (4) to the extent that payment of such interest is
lawful, interest upon overdue interest at the rate borne by the Securities; (b) the
rescission would not conflict with any judgment or decree of a court of
competent jurisdiction; 

 

A-7

 

and
(c) all Defaults and Events of Default, other than the non-payment of
principal of and interest on the Securities which have become due solely by
such declaration of acceleration, have been cured or waived.  No such rescission shall affect any
subsequent Default or impair any right consequent thereon.

 

Holders may not enforce the
Indenture or the Securities except as provided in the Indenture.  The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Securities.  Subject to certain limitations, Holders of a
majority in aggregate principal amount of the Securities then Outstanding may
direct the Trustee in its exercise of any trust or power.  The Trustee may, in accordance with the
provisions of the Indenture, withhold from Holders notice of any continuing
Default (except a Default in payment of principal or interest or to deliver
amounts owing upon conversion) if and so long as it determines that withholding
notice is in their interests.  The
Company is required to file periodic certificates with the Trustee as to the
Company’s compliance with the Indenture and knowledge or status of any Default.

 

14.          Trustee Dealings with the Company

 

Wells Fargo Bank, National
Association, the initial Trustee under the Indenture, or any of its Affiliates,
in its individual or any other capacity, may make loans to, accept deposits
from and perform services for the Company or an Affiliate of the Company or any
of the Subsidiary Guarantors, and may otherwise deal with the Company or an
Affiliate of the Company or any of the Subsidiary Guarantors, as if it were not
the Trustee, subject to the TIA.

 

15.          Guarantee

 

The Company’s obligations
under the Securities are fully and unconditionally guaranteed, jointly and
severally, by the Subsidiary Guarantors.

 

16.          No Recourse Against Others

 

No director, officer,
employee, stockholder, incorporator or agent of the Company, as such, will have
any liability for any obligations of the Company under the Securities, the
Indenture or for any claim based on, in respect of, or by reason of, such obligations
or their creation.  Each Holder of the
Securities by accepting a Security waives and releases all such liability.

 

17.          Authentication

 

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

 

18.          Abbreviations and Definitions

 

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

 

A-8

 

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

 

19.          Indenture to Control; Governing Law

 

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

 

The Company will furnish to
any Holder, upon written request and without charge, a copy of the
Indenture.  Requests may be made to Steel
Dynamics, Inc., 6714 Pointe Inverness Way, Suite 200, Fort Wayne,
Indiana 46804; Attention: Chief Financial Officer.

 

A-9

 

SCHEDULE OF EXCHANGES OF SECURITIES

 

The
initial principal amount of this Global Security
is                           ($           )
The following exchanges, purchases or conversions of a part of this Global
Security have been made:

 

	
  Date

  	
   

  	
  Authorized

  Signatory of

  Securities Custodian

  	
   

  	
  Notation Stating and Explaining Change

  in Principal

  Amount Recorded

  	
   

  	
  Principal Amount

  of this

  Global Security

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

A-10

 

ASSIGNMENT FORM

 

To
assign this Security, fill in the form below:

 

I,
or, we assign and transfer this Security to:

 

	
   

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

  

 

	
   

  
	
   

  
	
   

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

  

 

and
irrevocably appoint:

 

	
   

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

  

 

 

	
   

  	
   

  	
  Your Signature:

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

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

  
	
   

  	
   

  	
   

  	
   

  
	
  *Signature guaranteed by:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  

 

 

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

 

A-11

 

FORM OF CONVERSION NOTICE

 

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

 

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

 

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

 

	
   

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

  

 

	
   

  
	
   

  
	
   

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

  

 

 

	
   

  	
   

  	
   

  	
  Your Signature:

  
	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

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

  
	
   

  	
   

  	
   

  	
   

  
	
  *Signature guaranteed by:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  

 

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

 

A-12

 

FORM OF NOTICE OF REDEMPTION

 

[DATE]

 

To
the Holders of the 5.125% Convertible Senior Notes due 2014 issued by Steel
Dynamics, Inc.:

 

Steel Dynamics, Inc. (the “Issuer”) by this written notice
hereby exercises, pursuant to Section 3.01 of that certain Indenture (the “Indenture”),
dated as of June 9, 2009, among the Issuer,  the Initial Subsidiary Guarantors therein and
Wells Fargo Bank, National Association, its right to redeem
$[                  ]
of its 5.125% Convertible Senior Notes due 2014 (the “Securities”).  All capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to such terms in the
Indenture.

 

1.                    Redemption Date: 
[                    ,
        ]

 

2.                    Redemption Price: 
$[            ]

 

3.                    Conversion Rate:  Each $1,000 principal amount of the Securities
is convertible into 56.9801 shares of the Issuer’s common stock, par value
$0.10 per share (the “Common Stock”), subject to adjustment, during the period
described below.

 

4.                    Paying Agent and Conversion Agent:  [NAME] [ADDRESS]

 

5.                    The Securities called for redemption may be
converted at your option at any time from the date of this Notice of Redemption
until 5:00 p.m. (New York City time) on the Business Day immediately prior
to the Redemption Date set forth above.

 

6.                    The Securities called for redemption and not
converted at your election prior to 5:00 p.m. (New York City time) on the
Business Day immediately prior to Redemption Date set forth above shall be
redeemed on the Redemption Date.

 

7.                    If you elect to convert your Securities, you
must satisfy the requirements for conversion set forth in your Securities.

 

8.                    Your Securities called for redemption must be
surrendered by you (by effecting book entry transfer of the Securities or
delivering Certificated Securities, together with necessary endorsements, as
the case may be) to [Name of Paying Agent] at [insert address] in order
for you to collect the Redemption Price.

 

9.                    [The Securities bearing the following
Certificate Number(s) in the principal amount set forth below opposite
such Certificate Number(s) are being redeemed:

 

Certificate Number(s)         Principal
Amount]

 

10.              Unless the Issuer defaults in making the
payment of the Redemption Price owed to you, Interest and Special Interest, if
any, on your Securities called for redemption shall cease to accrue on and
after the Redemption Date.

 

11.              CUSIP Number: 
858119 AP5

 

STEEL DYNAMICS, INC.

 

A-13

 

FORM OF FUNDAMENTAL CHANGE
PURCHASE NOTICE

 

To: [Name of Paying Agent]

 

The
undersigned registered owner of this Security hereby acknowledges receipt of a
notice from Steel Dynamics, Inc. (the “Company”) pursuant to Section 3.08
of that certain Indenture (the “Indenture”), dated as of June 9, 2009,
among the Company, the Initial Subsidiary Guarantors named therein and Wells
Fargo Bank, National Association, and requests and instructs the Company to
purchase the entire principal amount of this Security, or the portion thereof
(which is $1,000 or an integral multiple thereof) below designated, in
accordance with the terms of the Security and the Indenture at the Fundamental
Change Purchase Price, together with accrued and unpaid interest (including
Special Interest, if any), to, but not including, the Fundamental Change
Purchase Date, to the registered Holder hereof.

 

 

	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Signature
  (s)

  
	
   

  	
   

  	
   

  
	
   

  	
   

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

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Signature
  Guaranty

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Principal
  amount to be redeemed (in an integral Multiple of $1,000, if less than all):

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Certificate
  number (if applicable):

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

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

 

A-14Exhibit
10.2

 

EMPLOYMENT SECURITY AGREEMENT

 

This Employment Security Agreement (the “Agreement”),
dated as of June       , 2009, is between
Zale Corporation (“Company”) and the undersigned Executive Vice
President of Company (“Executive”).

 

WHEREAS, in order to achieve its long term
objectives, Company recognizes that it is essential to attract and retain
qualified executives; and

 

WHEREAS, in consideration of Executive’s
valuable service for, and critical contribution to the success of, Company,
Company desires to provide Executive with certain benefits in the event
Executive’s employment is terminated, either in connection with or unrelated to
a Change of Control of Company, on the terms and subject to the conditions set
forth in this Agreement.  Capitalized
terms that are used in this Agreement but not defined in connection with their
use are defined in Article V.

 

NOW, THEREFORE, in
consideration of the promises and of the mutual covenants herein contained and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, it is agreed as follows:

 

ARTICLE I

TERMINATION BENEFITS

 

1.1          General Termination Benefits.  If Executive incurs a Qualifying Termination
other than during a Protection Period, he or she will receive the following
termination benefits:

 

(a)           Severance Pay.  Subject to Sections 1.7 and 2.1(a), Executive
will receive Severance Pay, which shall be paid in equal installments, in
accordance with Company’s regular payroll practices and procedures, over a six
(6) month period that commences on the first ordinary payroll payment date that
follows the date that is sixty (60) days after the date on which the Qualifying
Termination is incurred; provided that all unpaid portions of such Severance
Pay shall be distributed to Executive in a lump-sum on the payroll date
immediately preceding March 15 of the calendar year following the calendar year
in which Executive incurs such Qualifying Termination.  In the event that, after such Qualifying
Termination is incurred and Severance Pay under this Section 1.1(a) has
commenced, it is determined that such Qualifying Termination was incurred
during a Protection Period (including as a result of the occurrence of a Change
of Control within six months after such Qualifying Termination), then Executive
shall cease to receive Severance Pay under this Section 1.1(a) and shall be
entitled to additional Severance Pay in accordance with Section 1.2(a).

 

(b)           Accrued
Obligations.  Executive
will be entitled to (i) payment of any earned and unpaid Base Compensation
as of Termination of Employment; (ii) payment of any earned but unused
vacation as of the Termination of Employment, to the extent such vacation pay
is provided under the vacation plan or policy sponsored by Company that is applicable
to Executive; and (iii) any other earned and unpaid obligations as of the
Termination of Employment, including but not limited to any bonus to which
Executive may have become entitled but which has not yet been paid as of
Termination of Employment under the bonus plan or policy sponsored by Company
that is applicable to Executive (the “Accrued Obligations”).  Accrued Obligations 

 

 

described in clauses (i) and
(ii) above will be paid as part of Executive’s final ordinary payroll
payment from Company for active employment or contemporaneously with such
payment, but in no event later than thirty (30) days after such Termination of
Employment, and Accrued Obligations described in clause (iii) above will
be paid in accordance with the terms of the plan, policy, agreement or
arrangement under which they arose (including with respect to time of payment
or distribution).

 

(c)           Continued
Welfare Benefits.  Executive
and/or Executive’s dependents will be entitled to elect to continue their
respective health or welfare coverage pursuant to COBRA.  Provided that Executive and/or Executive’s
dependents elect and maintain such COBRA coverage until the expiration of their
eligibility under COBRA, following such expiration, Executive and/or Executive’s
dependents also will be entitled to elect to continue such coverage for the
remainder, if any, of the Severance Period. 
Such health and other welfare benefits will be provided monthly and will
provide the same coverage as available to others who elect coverage pursuant to
COBRA, even though, following the expiration of Executive’s eligibility for
COBRA, it would not be pursuant to COBRA, provided that the continued
participation of Executive and such dependents is possible under the general
terms and provisions of such health or welfare plans.  If Executive’s participation in any such plan
is barred or would result in adverse tax consequences to Executive or Company,
Company will arrange to provide Executive on a monthly basis with benefits
substantially similar to those that Executive otherwise would have been
entitled to receive under such plan or, alternatively at the option of Company,
reimburse Executive on a monthly basis for the reasonable actual costs of
purchasing in the marketplace substantially similar benefits; provided, however, that, in either
case, Executive will pay to Company, or provide a credit against Company’s
reimbursement obligation for, the amount equal to the premiums that Executive
would have been required to pay to maintain such benefits hereunder.

 

During the Severance Period, Executive’s
premiums for coverage provided pursuant to COBRA will be equal to the premiums
Executive paid prior to Termination of Employment.  All premium payments paid by Executive and/or
Executive’s dependents for coverage will be paid directly to the appropriate
insurer or service provider for such benefit (which may be Company).  For the avoidance of doubt, Executive’s
continuation of health and welfare benefits during the Severance Period shall
count against Executive’s continuation of coverage period required under COBRA.

 

Any health or welfare benefits received by or
available to Executive from or in connection with any other employment of
Executive, consultancy arrangement undertaken by Executive or similar source that
are reasonably comparable to, but not necessarily as financially or otherwise
beneficial to Executive as, the benefits provided to Executive by Company at
the time of the Termination of Employment will be deemed the equivalent thereof
and will terminate Company’s obligation under this Section 1.1(c) to
provide health and welfare coverage during the Severance Period: provided,
however, that nothing in this paragraph will limit or terminate
Executive’s or Executive’s dependents’ right to continue any Company group
health plan coverage at Executive’s or such dependent’s cost for the remainder
of the COBRA period.  Executive agrees to
advise Company of the availability of any such subsequent benefit coverages
within 30 days following such availability.

 

2

 

The provisions of this Section 1.1(c) will
not prohibit Company from changing the terms of any benefit programs provided
that any such changes apply to all executives of Company and its Affiliates (e.g., Company may switch insurance
carriers or preferred provider organizations or change coverages).

 

(d)           Outplacement
Services.  Executive
will be entitled to receive outplacement services from an entity selected by
Company for a period of three (3) months, provided that such services do
not commence later than six (6) months following Termination of
Employment.  Company will pay the
outplacement service provider directly for the cost of such outplacement
services.

 

(e)           Equity
Compensation Adjustments.  Any
equity-based compensation awards granted to Executive by Company under an
Equity Plan that vested prior to such Termination of Employment will be
governed by the terms of such awards and such Equity Plan.  Any equity-based compensation awards granted
to Executive by Company under an Equity Plan that are unvested on Termination
of Employment will expire, unless otherwise provided in such awards or such
Equity Plan.  Following his or her
Termination of Employment, Company will not grant Executive any equity-based compensation
awards.

 

(f)            401(k) Plan.  The terms of the 401(k) Plan will govern
Executive’s account balance, if any, under such 401(k) Plan.

 

1.2          Termination Benefits in
Connection with a Change of Control.  If Executive incurs a Qualifying Termination
during a Protection Period, he or she will receive the following termination
benefits:

 

(a)           Severance Pay.  Subject to Sections 1.7 and 2.1(a), Executive
will receive Severance Pay in a single lump-sum within sixty (60) days after
the date on which the Qualifying Termination is incurred.  In the case of a Qualifying Termination that
is incurred during the portion of the Protection Period that precedes the
Change of Control, (i) the amount of Severance Pay payable to Executive
pursuant to this Section 1.2(a) shall be reduced by the amount of any Severance
Pay paid to Executive pursuant to Section 1.1(a) prior to the date the Change
of Control occurs and (ii) such additional Severance Pay shall be paid to
Executive in a single lump-sum within sixty (60) days after the date on which
such Change of Control occurred.

 

(b)           Accrued
Obligations.  Executive
will be entitled to payment of any Accrued Obligations in accordance with the
provisions of Section 1.1(b).

 

(c)           Continued
Welfare Benefits.  Executive
and Executive’s dependents will be entitled to receive health and other welfare
benefits in accordance with the provisions of Section 1.1(c) for the
duration of the Severance Period.

 

(d)           Outplacement
Services.  Executive
will be entitled to receive outplacement services in accordance with the
provisions of Section 1.1(d).

 

(e)           Equity
Compensation Adjustments.  Any
equity-based compensation awards granted to Executive by Company under an
Equity Plan that vested prior to such Termination of Employment will be
governed by the terms of such awards and such Equity Plan.  Any equity-based compensation awards granted
to Executive by Company under an Equity Plan that are unvested on Termination
of Employment will 

 

3

 

vest immediately upon
Termination of Employment, unless otherwise provided in such awards or such
Equity Plan.  Following his or her
Termination of Employment, Company will not grant Executive any equity-based
compensation awards.

 

(f)            401(k) Plan.  The terms of the 401(k) Plan will govern
Executive’s account balance, if any, under such 401(k) Plan.

 

(g)           Conditional
Cap on Severance Pay.  If the
payments to Executive pursuant to this Agreement (when considered with all
other payments made to Executive as a result of a Termination of Employment
that are subject to Section 280G of the Code) (the amount of all such
payments, collectively, the “Parachute Payment”) result in Executive
becoming liable for the payment of any excise taxes pursuant to section 4999 of
the Code (“280G Excise Tax”). 
Executive will receive the greater on an after-tax basis of (i) the
severance benefits payable pursuant to this Section 1.2 or (ii) the
severance benefits payable pursuant to this Section 1.2 as reduced to
avoid imposition of the 280G Excise Tax (the “Conditional Capped Amount”).

 

Not more than fourteen (14) days following
the Termination of Employment Company will notify Executive in writing (A) whether
the severance benefits payable pursuant to this Section 1.2 when added to
any other Parachute Payments payable to Executive exceed an amount equal to
299% (the “299% Amount”) of Executive’s “base amount” as defined in Section 280G(b)(3) of
the Code, (B) the amount that is equal to the 299% Amount, (C) whether
the severance benefit described in Section 1.2(g)(i) or the
Conditional Capped Amount pursuant to section 1.2(g)(ii) is greater on an
after-tax basis and (C) if the Conditional Capped Amount is the greater
amount, the amount that the severance benefits payable pursuant to this Section 1.2
must be reduced to equal such amount.

 

The calculation of the 299% Amount, the
determination of whether the termination benefits described in Section
1.2(g)(i) or the Conditional Capped Amount described in Section 1.2(g)(ii) is
greater on an after-tax basis and, if the Conditional Capped Amount in Section
1.2(g)(ii) is the greater amount, the determination of how much Executive’s
termination benefits must be reduced in order to avoid application of the 280G
Excise Tax will be made by Company’s public accounting firm in accordance with
section 280G of the Code or any successor provision thereto.  For purposes of making the reduction of
amounts payable under this Agreement, such amounts shall be eliminated in the
following order:  (1) any cash
compensation, (2) any health or welfare benefits, (3) any equity compensation,
and (4) any other payments hereunder. 
Reductions of such amounts shall take place in the chronological order
with respect to which such amounts would be paid from the date of the Termination
of Employment absent any acceleration of payment.  If the reduction of the amounts payable
hereunder would not result in a reduction of the Parachute Payments to the
Conditional Capped Amount, no amounts payable under this Agreement shall be
reduced pursuant to this provision.  The
costs of obtaining such determination will be borne by Company.

 

1.3          Termination Benefits in
Connection With Disability.  If Executive has a Termination of Employment
as a result of a Disability, he or she will receive the following termination
benefits:

 

(a)           Severance Pay.  Subject to Sections 1.7 and 2.1(a), Executive
will receive Severance Pay, which shall be paid in equal installments, in
accordance with 

 

4

 

Company’s regular payroll
practices and procedures, over a six (6) month period that commences on the
first ordinary payroll payment date that follows the date that is sixty (60)
days after the date on which the Executive has a Termination of Employment as a
result of a Disability; provided that all unpaid portions of such Severance Pay
shall be distributed to Executive in a lump-sum on the payroll date immediately
preceding March 15 of the calendar year following the calendar year in which
such Termination of Employment occurs.

 

(b)           Accrued
Obligations.  Executive
will be entitled to payment of any Accrued Obligations in accordance with the
provisions of Section 1.1(b).

 

(c)           Continued
Welfare Benefits.  Executive
and Executive’s dependents will be entitled to receive health and other welfare
benefits in accordance with the provisions of Section 1.1(c) for the
duration of the Severance Period.

 

(d)           Equity
Compensation Adjustments.  Any
equity-based compensation awards granted to Executive by Company under an
Equity Plan that vested prior to such Termination of Employment will be
governed by the terms of such awards and such Equity Plan.  Any equity-based compensation awards granted
to Executive by Company under an Equity Plan that are unvested on Termination
of Employment will expire, unless otherwise provided in such awards or such
Equity Plan.  Following his or her
Termination of Employment, Company will not grant Executive any equity-based
compensation awards.

 

(e)           401(k) Plan.  The terms of the 401(k) Plan will govern
Executive’s account balance, if any, under such 401(k) Plan.

 

1.4          Termination Benefits in
Connection With Death.  If
Executive has a Termination of Employment due to death while employed by
Company, his or her estate will receive the following benefits:

 

(a)           Severance Pay.  Subject to Section 2.1(a), Executive’s estate
will receive Severance Pay, which shall be paid in equal installments, in
accordance with Company’s regular payroll practices and procedures, over a six
(6) month period that commences on the first ordinary payroll payment date that
follows the date that is sixty (60) days after the date on which the Executive
has a Termination of Employment due to death; provided that all unpaid portions
of such Severance Pay shall be distributed to Executive’s estate in a lump-sum
on the payroll date immediately preceding March 15 of the calendar year
following the calendar year in which such Termination of Employment occurs.

 

(b)           Accrued
Obligations.  Executive’s
estate will be entitled to payment of any Accrued Obligations in accordance
with the provisions of Section 1.1(b).

 

(c)           Continued
Welfare Benefits.  Executive’s
dependants will be entitled to continue their health and welfare benefits, if
any, pursuant to COBRA.

 

(d)           Equity
Compensation Adjustments.  Any equity-based
compensation awards granted to Executive by Company under an Equity Plan that
vested prior to such Termination of Employment will be governed by the terms of
such awards and such Equity Plan.  Any
equity-based compensation awards granted to Executive by 

 

5

 

Company under an Equity Plan
that are unvested on Termination of Employment will expire, unless otherwise
provided in such awards or such Equity Plan.

 

(e)           401(k) Plan.  The terms of the 401(k) Plan will govern
Executive’s account balance, if any, under such 401(k) Plan.

 

1.5          Distributions on Account of
Death of Executive During the Severance Period.  If Executive becomes entitled to Severance
Pay pursuant to Section 1.1, 1.2 or 1.3 and dies during the Severance
Period, the following benefits will be payable:

 

(a)           Severance
Pay.  Any remaining Severance Pay
payable to Executive as of the date of his or her death will continue to be
paid to Executive’s estate pursuant to Section 1.1, 1.2 or 1.3, as
applicable.

 

(b)           Accrued
Obligations.  Executive’s
estate will be entitled to payment of any Accrued Obligations unpaid as of the
date of Executive’s death in accordance with the provisions of Section 1.1(b).

 

(c)           Continued
Welfare Benefits.  Executive’s
dependents will be entitled to continue to receive any health or other welfare
benefits that they received immediately prior to the date of Executive’s death
for the remainder of the applicable period, subject to the limitations
contained in Section 1.1(c).

 

(d)           Outplacement
Services.  Any
outplacement service benefits available to Executive pursuant to Section 1.1(d)
or 1.2(d) will cease as of the date of Executive’s death.

 

(e)           Equity
Compensation Adjustments.  Upon
death of Executive, any equity-based compensation awards granted to Executive
by Company under an Equity Plan that vested prior to Executive’s death will be
governed by the terms of such awards and such Equity Plan.  Any equity-based compensation awards granted
to Executive by Company under an Equity Plan that are unvested on Executive’s
death will expire, unless otherwise provided in such awards and such Equity
Plan.

 

(f)            401(k) Plan.  The terms of the 401(k) Plan will govern
Executive’s account balance, if any, under such 401(k) Plan.

 

1.6          Termination Benefits in
Connection With a Termination Other Than a Qualifying Termination.  If Executive has a Termination of Employment
that is not described in Section 1.1, 1.2, 1.3 or 1.4, he or she will
receive the following termination benefits:

 

(a)           Severance
Pay.  Executive will not receive any
Severance Pay.

 

(b)           Accrued
Obligations.  Executive
will be entitled to payment of any Accrued Obligations in accordance with the
provisions of Section 1.1(b).

 

(c)           Continued
Welfare Benefits.  Executive
and Executive’s dependants will be entitled to continue their health and
welfare benefits, if any, pursuant to COBRA.

 

(d)           Equity
Compensation Adjustments.  Any
equity-based compensation awards granted to Executive by Company under an
Equity Plan that vested prior to such Termination of Employment will be
governed by the terms of such awards and such Equity Plan.  Any equity-based compensation awards granted
to Executive by 

 

6

 

Company under an Equity Plan
that are unvested on Termination of Employment will expire, unless otherwise
provided in such awards or such Equity Plan. 
Following his or her Termination of Employment, Company will not grant
Executive any equity-based compensation awards.

 

(e)           401(k) Plan.  The terms of the 401(k) Plan will govern
Executive’s account balance, if any, under such 401(k) Plan.

 

1.7          Code Section 409A.

 

(a)           It is the intention of
Company and Executive that the provisions of this Agreement comply with Section 409A
of the Code and the rules, regulations and other authorities promulgated
thereunder (including the transition rules thereof) (collectively, “409A”),
and all provisions of this Agreement will be construed and interpreted in a
manner consistent with 409A.

 

(b)           To the extent Executive is a
“specified employee,” as defined in Section 409A(a)(2)(B)(i) of the
Code and as determined in good faith by Company, notwithstanding the timing of
payment provided in any other Section of this Agreement, no payment,
distribution or benefit under this Agreement that constitutes a distribution of
deferred compensation (within the meaning of Treasury Regulation Section 1.409A-1(b))
upon separation from service (within the meaning of Treasury Regulation Section 1.409A-1(h)),
after taking into account all available exemptions that would otherwise be
payable during the six-month period after separation from service will be made
during such six-month period, and any such payment, distribution or benefit
will instead be paid on the first business day after such six-month period.

 

(c)           In the event that Company
determines that any provision of this Agreement does not comply with 409A,
Company will be entitled  (but will have
no obligation) without Executive’s consent, to amend or modify such provision
to comply with 409A; provided, however,
that such amendment or modification will, to the greatest extent commercially
practicable, maintain the economic value to Executive of such provision.

 

(d)           For purposes of 409A, each
installment of Severance Pay under Sections 1.1(a), 1.3(a) and 1.4(a) will
be deemed to be a separate payment as permitted under Treasury Regulation Section 1.409A-2(b)(2)(iii).

 

(e)           Except
as permitted by Section 409A, the continued benefits provided to Executive
pursuant to this Agreement during any calendar year will not affect the
continued benefits provided to Executive in any other calendar year, and the
amount of any costs of purchasing benefits reimbursed pursuant to this
Agreement shall be paid to Executive no later than the last day of the calendar
year following the calendar year in which such costs are incurred by Executive.

 

(f)            Neither
Executive nor any creditor or beneficiary of Executive will have the right to
subject any deferred compensation (within the meaning of Section 409A) payable
under this Agreement or under any other plan, policy, arrangement or agreement
of or with Company or any affiliate thereof (this Agreement and such other
plans, policies, arrangements and agreements, the “Company Plans”) to any
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
attachment or garnishment.  Except as
permitted by Section 409A, any deferred compensation 

 

7

 

(within the meaning of
Section 409A) payable to or for the benefit of Executive under any Company Plan
may not be reduced by, or offset against, any amount owing by Executive to the
Company or any affiliate thereof.

 

ARTICLE II

EXECUTIVE COVENANTS

 

2.1          Release; Covenants.  As a condition of obtaining benefits under
this Agreement, Executive will be required to (a) within forty-five (45)
days following Termination of Employment execute and deliver to Company a
general release of claims against Company in such form as may be required by
Company and (b) comply with the covenants set forth in this Article II.  In the event that Executive fails to execute
and deliver such general release within such forty-five-day period or revokes
such general release (but only to the extent revocation is permitted under the
terms of such general release), then Executive will forfeit all entitlement to
any payment, benefit or other amount hereunder. 
Executive’s failure to comply with the covenants of this Article II
will be governed by Section 2.7 and Article III.

 

2.2          Confidential Information.  Company promises to disclose to Executive and
Executive acknowledges that in and as a result of his or her employment with
Company, he or she will receive, make use of, acquire, have access to and/or
become familiar with various trade secrets and proprietary and confidential
information of Company and its Affiliates, including, but not limited to,
processes, computer programs, compilations of information, records, financial
information, sales reports, sales procedures, customer requirements, pricing
techniques, customer lists, methods of doing business, identities, locations,
performance and compensation levels of employees and other confidential
information which are owned by Company and/or its Affiliates and regularly used
in the operation of its business, and as to which Company and/or its Affiliates
take precautions to prevent dissemination to persons other than certain
directors, officers and employees (collectively, “Trade Secrets”).  Executive acknowledges and agrees that the
Trade Secrets:

 

(a)           are secret and not known in
the industry;

 

(b)           give Company or its
Affiliates an advantage over competitors who do not know or use the Trade
Secrets;

 

(c)           are of such value and nature
as to make it reasonable and necessary to protect and preserve the
confidentiality and secrecy of the Trade Secrets; and

 

(d)           are valuable, special and
unique assets of Company or its Affiliates, the disclosure of which could cause
substantial injury and loss of profits and goodwill to Company or its
Affiliates.

 

Executive promises not to
use in any way or disclose any of the Trade Secrets, directly or indirectly,
either during or after his or her employment by Company, except as required in
the course of his or her employment, if required in connection with a judicial or
administrative proceeding, or if the information becomes public knowledge other
than as a result of an unauthorized disclosure by Executive.  All files, records, documents, information,
data compilations and similar items containing non-public and confidential
information relating to the business of Company, whether prepared by Executive
or otherwise coming into his or her possession, will remain the exclusive
property of Company and may not be removed from the premises of Company under
any circumstances without the prior written consent of Company (except in the
ordinary course of business during Executive’s employment by 

 

8

 

Company), and in any event
must be promptly delivered to Company upon termination of Executive’s
employment with Company.  Executive
agrees that upon receipt of any subpoena, process or other request to produce
or divulge, directly or indirectly, any Trade Secrets to any entity, agency,
tribunal or person, whether received during or after the term of Executive’s
employment with Company, Executive will timely notify and promptly provide a
copy of the subpoena, process or other request to Company.  For this purpose, Executive irrevocably
nominates and appoints Company (including any attorney retained by Company), as
his or her true and lawful attorney-in-fact, to act in Executive’s name, place
and stead to perform any reasonable and prudent act that Executive might
perform to defend and protect against any disclosure of any Trade Secrets.

 

The parties agree that the
above restrictions on confidentiality and disclosure are completely severable
and independent agreements supported by good and valuable consideration and, as
such, will survive the termination of this Agreement for whatever reason.  The parties further agree that any invalidity
or unenforceability of any one or more of such restrictions on confidentiality
and disclosure will not render invalid or unenforceable any remaining
restrictions on confidentiality and disclosure. 
Additionally, should an arbitrator or court of competent jurisdiction
determine that the scope of any provision of this Section 2.2 is too broad
to be enforced as written, the parties intend that the court reform the
provision to such narrower scope as it determines to be reasonable and
enforceable.

 

2.3          Non-Competition.  As a material inducement for Company’s
promise to provide the trade secrets and proprietary and confidential
information described in Section 2.2, Executive agrees that during the
term of his or her employment with Company and during the applicable Severance
Period specified in Section 5.14, he or she will not, directly or
indirectly, as an employee, consultant or otherwise, compete with Company by
providing services relating to retail or non-retail sales of jewelry to any
other person, partnership, association, corporation, or other entity that is in
a “Competing Business.”  As used herein,
a “Competing Business” is any business that, in whole or in material
part, in the United States, Canada and/or Puerto Rico, (a) engages in the
retail sale of jewelry, including, but not limited to, specialty jewelry
retailers and other retailers having jewelry divisions or departments, or (b) operates
as a vendor of jewelry, including, but not limited to, as a wholesaler,
manufacturer or direct importer of jewelry. 
The restrictions contained in this Section 2.3 will be tolled on a
day-for-day basis for each day during which Executive participates in any
activity in violation of such restrictions.

 

The parties agree that,
subject to the terms of Section 2.1, the above restrictions on competition
are completely severable and independent agreements supported by good and
valuable consideration and, as such, will survive the termination of this
Agreement for whatever reason.  The
parties further agree that any invalidity or unenforceability of any one or
more of such restrictions on competition will not render invalid or
unenforceable any remaining restrictions on competition.  Additionally, should an arbitrator or a court
of competent jurisdiction determine that the scope of any provision of this Section 2.3
is too broad to be enforced as written, the parties intend that the arbitrator
or court reform the provision to such narrower scope as it determines to be
reasonable and enforceable.

 

2.4          Agreement Not to Solicit
Employees.  Executive
covenants and agrees that during Executive’s employment with Company and
thereafter during the applicable Severance Period specified in Section 5.14,
Executive will not, on his or her own behalf or on behalf of any other person,
partnership, association, corporation, or other entity, (a) directly,
indirectly, or through a third party hire, cause to be hired or solicit any
employee of Company or its 

 

9

 

Affiliates or (b) in
any manner attempt to influence or induce any employee of Company or its
Affiliates to leave the employment of Company or its Affiliates, nor will he or
she use or disclose to any person, partnership, association, corporation or
other entity any information concerning the names and addresses of any
employees of Company or its Affiliates. 
The restrictions contained in this Section 2.4 will be tolled on a
day-for-day basis for each day during which Executive participates in any
activity in violation of such restriction.

 

The parties agree that,
subject to the terms of Section 2.1, the above restrictions on the
solicitation of employees are completely severable and independent agreements
supported by good and valuable consideration and, as such, will survive the
termination of this Agreement for whatever reason.  The parties further agree that any invalidity
or unenforceability of any one or more of such restrictions on the solicitation
of employees will not render invalid or unenforceable any remaining
restrictions on the solicitation of employees. 
Additionally, should an arbitrator or court of competent jurisdiction
determine that the scope of any provision of this Section 2.4 is too broad
to be enforced as written, the parties intend that the court reform the
provision to such narrower scope as it determines to be reasonable and
enforceable.

 

2.5          Nondisparagement.  Executive covenants and agrees that he or she
will not make any public or private statements, comments, or communications in
any form, oral, written, or electronic (all of the foregoing, for purposes of
this paragraph, “Communications”), which in any way could constitute
libel, slander, or disparagement of Company, its Affiliates, its and/or their
employees, officers, and/or directors, or which may be considered to be
derogatory or detrimental to its or their good name or business; provided,
however, that the terms of this paragraph will not (a) apply to
Communications between Executive and his or her spouse, clergy, or attorneys,
which are subject to a claim of privilege existing under common law, statute,
or rule of procedure; (b) apply to Communications required by law or
made in response to a valid subpoena or other lawful order compelling Executive
to provide testimony or information (subject to the provisions of Section 2.2);
or (c) be construed to inhibit or limit Executive’s ability to initiate or
cooperate with any investigation by a governmental or regulatory agency or
official or other judicial or legal actions (subject to the provisions of Section 2.2).  Executive specifically agrees not to issue
any public statement concerning his or her employment by Company and/or the
cessation of such employment.

 

2.6          Reasonableness of
Restrictions.  Executive
agrees that Executive and Company are engaged in a highly competitive business
and, due to Executive’s position with Company and the nature of Executive’s
work, Executive’s engaging in any business that is competitive with that of
Company will cause Company great and irreparable harm.  Executive represents and warrants that the
time, scope and geographic area restricted by the foregoing Sections 2.2, 2.3,
2.4 and 2.5 pertaining to confidential information, non-competition, non-solicitation,
and non-disparagement are reasonable, that the enforcement of the restrictions
contained in such Sections would not be unduly burdensome to Executive, and
that Executive will be able to earn a reasonable living while abiding by the
terms included herein.  Executive agrees
that the restraints created by the covenants in Sections 2.2, 2.3, 2.4 and 2.5
pertaining to confidential information, non-competition, non-solicitation, and
non-disparagement are not outweighed by either the hardship to Executive or any
injury likely to the public.  If any
arbitrator or court determines that any portion of this Article II is
invalid or unenforceable, the remainder of this Article II will not
thereby be affected and will be given full effect without regard to the invalid
provisions.  If any court construes any
of the provisions of this Article II, or any part thereof, to be
unreasonable because of the duration or scope of such provision, 

 

10

 

such
court will have the power to reduce the duration or scope of such provision and
to enforce such provision as so reduced.

 

2.7          Enforcement.  Upon Executive’s employment with an entity
that is not an Affiliate of Company (a “Successor Employer”) during the
period that the provisions of this Article II remain in effect, Executive
will provide such Successor Employer with a copy of this Agreement and will
notify Company of such employment within thirty (30) days thereof.  Executive agrees that in the event of a
breach of the terms and conditions of this Article II by Executive,
Company will be entitled, if it so elects, to institute and prosecute
proceedings pursuant to Article III, either in law or in equity, against
Executive, to obtain damages for any such breach, or to enjoin Executive from
any conduct in violation of this Article II.  In the event Company seeks an injunction or
restraining order against Executive for breach of this Article II,
Executive waives any requirement that Company post bond in connection with such
request for relief.

 

2.8          Recoupment.  Executive acknowledges and agrees that
Company’s remedies at law for a breach or threatened breach of any of the
provisions of this Article II of the Agreement would be inadequate and, in
recognition of this fact, Executive agrees that, in the event of such a breach
or threatened breach, in addition to any remedies at law, Executive shall
forfeit all payments otherwise due under the Agreement and shall return to
Company any Severance Pay made to Executive prior to such forfeiture.

 

ARTICLE III

DISPUTE RESOLUTION

 

3.1          Arbitration.  Company and Executive agree that any
controversy or claim (including all claims pursuant to common and statutory
law) relating to this Agreement or arising out of or relating to the subject
matter of this Agreement or Executive’s employment by Company will be resolved
exclusively through binding arbitration. 
Subject to the terms and any exceptions provided in this Agreement, the
parties each waive the right to a jury trial and waive the right to adjudicate
their disputes under this Agreement outside the arbitration forum provided for
in this Agreement.  The arbitration will
be administered by a single neutral arbitrator admitted to practice law in
Texas for a minimum of ten years.  Any
such arbitration proceeding will take place in Dallas County, Texas and will be
administered by the American Arbitration Association (“AAA”) Dallas
office in accordance with its then-current applicable rules and
procedures.  The arbitrator will have the
authority to award the same remedies, damages and costs that a court could
award.  The arbitrator will issue a
reasoned award explaining the decision, the reasons for the decision and any
damages awarded.  The arbitrator’s
decision will be final and binding.  This
provision can be enforced under the Federal Arbitration Act.

 

3.2          Entitlement to Injunctive
Relief.  As the sole exception to the
exclusive and binding nature of the arbitration commitment set forth above,
Executive and Company agree that Company will have the right to initiate an
action in any state or federal court of competent jurisdiction in Dallas
County, Texas in order to request temporary, preliminary and permanent
injunctive or other equitable relief, including, without limitation, specific
performance, to enforce the terms of Sections 2.2, 2.3, 2.4, or 2.5 above,
without the necessity of proving inadequacy of legal remedies or irreparable
harm or posting bond; provided, however, that if Executive is engaging in
activities prohibited by Section 2.2, 2.3, 2.4 or 2.5 above, outside of
Dallas County, Texas, the parties hereby agree that the Company may, at its
sole option, bring an action in any court of competent jurisdiction.  Nothing herein shall prevent the Company from
pursuing the same injunctive or equitable relief in the arbitration proceedings.  Moreover, 

 

11

 

nothing in this section
should be construed to constitute a waiver of the parties’ rights and
obligations to arbitrate regarding matters other than those specifically
addressed in this paragraph.

 

3.3          Limitation of Scope.  Should a court of competent jurisdiction
determine that the scope of the arbitration and related provisions of this
Agreement are too broad to be enforced as written, the parties intend that the
court reform the provision to such narrower scope as it determines to be
reasonable and enforceable.

 

3.4          Payments Pending Litigation
and/or Arbitration.  In the case
of a Qualifying Termination other than during a Protection Period, upon the
material violation of any of the provisions of this Agreement or a dispute
regarding the subject matter of this Agreement, Company shall cease payment of
all Severance Pay and severance benefits pending the outcome of litigation
and/or arbitration on such issues pursuant to this Article III.  In the case of a Qualifying Termination
during a Protection Period, upon the material violation of any of the
provisions of this Agreement or a dispute regarding the subject matter of this
Agreement, Company shall continue payment of all Severance Pay and severance
benefits pending the outcome of litigation and/or arbitration pursuant to this Article Ill
subject to being reimbursed if so ordered in any such litigation or
arbitration.

 

3.5          Fees and Expenses.  If Company or Executive sues in court or brings
an arbitration action against the other for a breach of any provision of this
Agreement or regarding any dispute arising from the subject matter of this
Agreement, the prevailing party will be entitled to recover its attorneys’
fees, court costs, arbitration expenses, and its portion of the fees charged by
AAA and/or the individual arbitrator, as applicable, regardless of which party
initiated the proceedings.  If there is
no prevailing party, the fees charged by AAA and/or the individual arbitrator
will be borne equally by Company and Executive, and Company and Executive will
each bear their own costs and attorneys’ fees incurred in arbitration.  In the event that Executive prevails on at
least one material issue, Executive will be deemed to be the prevailing party; provided,
however, that if Executive does not prevail on at least one material
issue, the Company shall be deemed to be the prevailing party.

 

3.6          Right of Offset.  If Executive is at any time indebted to
Company, or otherwise obligated to pay money to Company for any reason,
Company, at its election, may offset amounts otherwise payable to Executive
under this Agreement against any such indebtedness or amounts due from
Executive to Company, to the extent permitted by law.

 

3.7          Other Matters and
Acknowledgement.  All
proceedings conducted pursuant to this agreement to arbitrate, including any
order, decision or award of the arbitrator, will be kept confidential by all
parties except to the extent necessary to enforce the award.  EXECUTIVE ACKNOWLEDGES THAT, BY SIGNING THIS
AGREEMENT, EXECUTIVE IS WAIVING ANY RIGHT THAT EXECUTIVE MAY HAVE TO A
JURY TRIAL OR A COURT TRIAL OF ANY EMPLOYMENT-RELATED CLAIM ALLEGED BY
EXECUTIVE.

 

ARTICLE IV

MISCELLANEOUS PROVISIONS

 

4.1          Executive Acknowledgement.  Executive is entering into this Agreement of
his or her own free will.  Executive
acknowledges that he or she has had adequate opportunity to review this
Agreement and consult with counsel of his or her own choosing.  Executive represents that he or she has read
and understands this Agreement, he or she is fully aware of this 

 

12

 

Agreement’s legal effect and
has not acted in reliance upon any statements made by Company other than those
set forth in writing in the Agreement.

 

4.2          At Will Employment.  Notwithstanding any provision in this
Agreement to the contrary, Executive hereby acknowledges and agrees that
Executive’s employment with Company is for an unspecified duration and
constitutes “at-will” employment, and Executive further acknowledges and agrees
that this employment relationship may be terminated at any time, with or
without Cause or for any or no Cause, at the option either of Company or
Executive.

 

4.3          Successors and Assigns.  The rights and obligations of Company under
this Agreement will inure to the benefit of and will be binding upon the
successors and assigns of Company. 
Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation, sale of assets or otherwise) to all or
substantially all of the business and/or assets of Company, by a written
agreement in form and substance reasonably satisfactory to Executive, to assume
expressly and agree to perform this Agreement in the same manner and to the
same extent that Company would be required to perform it if no such succession
had taken place.  This Agreement is
personal to Executive and without the prior written consent of Company is not
assignable by Executive otherwise than by will or the laws of descent and distribution.  This Agreement will inure to the benefit of
and be enforceable by Executive’s personal and legal representatives,
executors, administrators, heirs, distributes, devisees and legatees.

 

4.4          Amendment.  This agreement may be amended or terminated
at any time by Company, by a resolution of the Board of Directors of Company or
the Compensation Committee thereof, the substance of which is promptly
communicated to Executive; provided that, without the written consent of
Executive, no such termination of this Agreement or amendment reducing any
benefits provided hereunder shall be effective prior to the expiration of the
one-year anniversary of the adoption of such resolution; and provided, further,
that without the written consent of Executive, no amendment or termination
shall become effective during a Protection Period.  No amendment or termination shall affect any
vested rights or benefits to which Executive is entitled at the effective time
of such amendment or termination. 
Otherwise, the Agreement may be amended or terminated only as provided
in Section 1.7 or by an instrument in writing signed by Company and
Executive.

 

4.5          Severability.  If any provision of this Agreement is held to
be illegal, invalid or unenforceable under present or future laws effective
during the term of this Agreement, such provision will be fully severable; this
Agreement will be construed and enforced as if such illegal, invalid or
unenforceable provision had never comprised a portion of this Agreement; and
the remaining provisions of this Agreement will remain in full force and effect
and will not be affected by the illegal, invalid or unenforceable provision or
by its severance from this Agreement. 
Furthermore, in lieu of such illegal, invalid or unenforceable
provision, there will be added automatically as part of this Agreement a
provision as similar in terms to such illegal, invalid or unenforceable
provision as may be possible and be legal, valid and enforceable.

 

4.6          Integration.  The provisions of this Agreement constitute
the entire and complete understanding and agreement between the parties with
respect to the subject matter hereof, and supersede all prior and
contemporaneous oral and written agreements, representations and understandings
of the parties, including without limitation The Executive Severance Plan for
Zale Corporation and its Affiliates and any Change of Control Agreement or
employment agreement (including any offer letter) between Executive and
Company, which are hereby terminated with respect to Executive.

 

13

 

4.7          Choice of Law; Forum
Selection.  THIS
AGREEMENT WILL BE EXCLUSIVELY GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF TEXAS WITHOUT REFERENCE TO PRINCIPLES OF CONFLICTS OF LAWS
OF TEXAS OR ANY OTHER JURISDICTION, AND, WHERE APPLICABLE, THE LAWS OF THE
UNITED STATES.

 

The parties hereby agree
that any action to enforce the arbitrator’s award shall be filed exclusively in
a state or federal court of competent jurisdiction in Dallas County, Texas and
the parties hereby consent to the exclusive jurisdiction of such court; provided,
however, that nothing herein shall preclude the parties’ rights to
conduct collection activities in the courts of any jurisdiction with respect to
the order or judgment entered upon the arbitrator’s award by the Texas court.

 

4.8          Survival.  The provisions of Article II, Article III,
this Article IV and Article V will survive the termination of this
Agreement.  The existence of any claim or
cause of action of Executive against the Company, whether predicated on this
Agreement or otherwise, will not constitute a defense to the enforcement by the
Company of the covenants of Executive contained in this Agreement, including
but not limited to those contained in Article II.

 

4.9          No Waiver.  No waiver by either party at any time of any
breach by the other party of, or compliance with, any condition or provision of
this Agreement to be performed by the other party will be deemed a waiver of
similar or dissimilar provisions or conditions at any time.

 

4.10        Notice.  For all purposes of this Agreement, all
communications required or permitted to be given under this Agreement will be
in writing and will be deemed to have been duly given when hand delivered or
dispatched by electronic facsimile transmission (with receipt thereof
confirmed), or five business days after having been mailed by United States
registered or certified mail, return receipt requested, postage prepaid, or two
business days after having been sent by a nationally recognized overnight
courier service, addressed to Company at its principal executive office, to
Company’s General Counsel, and to Executive at Executive’s principal residence,
or to such other address as any party may have furnished to the other in
writing, except that notices of change of address will be effective only upon
receipt.

 

4.11        Counterparts.  This Agreement may be executed in several
counterparts, each of which will be deemed to be an original, but all of which
together will constitute one and the same Agreement.

 

4.12        Construction.  This Agreement is deemed to be drafted
equally by both Executive and Company and will be construed as a whole and
according to its fair meaning.  Any
presumption or principle that the language of this Agreement is to be construed
against any party will not apply.  The
headings in this Agreement are only for convenience and are not intended to
affect construction or interpretation. 
Any references to paragraphs, subparagraphs, sections, subsections or
clauses are to those parts of this Agreement, unless the context clearly
indicates to the contrary.  Also, unless
the context clearly indicates to the contrary, (a) the plural includes the
singular and the singular includes the plural; (b) “and” and “or” are each
used both conjunctively and disjunctively; (c) “any,” “all,” “each,” or “every”
means “any and all”, and “each and every”; (d) “includes” and “including”
are each used without limitation; (e) “herein,” “hereof,” “hereunder” and
other similar compounds of the word “here” refer to the entire Agreement and
not to any particular paragraph, subparagraph, section or subsection; and (f) all
pronouns and any variations thereof will be deemed to refer 

 

14

 

to
the masculine, feminine, neuter; singular or plural as the identity of the
entities or persons referred to may require.

 

4.13        No Mitigation.  Except as provided in Sections 1.1(c), 1.2(c) or
1.3(c) (regarding continued welfare benefits), in no event will Executive
be obligated to seek other employment or take any other action by way of
mitigation of the amounts payable to Executive under any of the provisions of
this Agreement and such amounts will not be reduced whether or not Executive
obtains other employment.

 

4.14        Withholding.  Company may deduct and withhold from any
amounts payable under this Agreement such Federal, state, local, foreign or
other taxes as are required to be withheld pursuant to any applicable law or
regulation.

 

ARTICLE V

DEFINITIONS

 

5.1          “Affiliate”
means a corporation that is a member of a controlled group of corporations (as
defined in section 414(b) of the Code) that includes Company, any trade or
business (whether or not incorporated) that is in common control (as defined in
section 414(c) of the Code) with Company, or any entity that is a member
of the same affiliated service group (as defined in section 414(m) of the
Code) as Company.

 

5.2          “Base Compensation”
means Executive’s gross base salary at the time of his or her Termination of
Employment before reduction by any pre-tax contributions to the 401(k) Plan
or any other benefit plan maintained by the Company or its Affiliates or any
other deductions of any nature.

 

5.3          “Bonus”
means the average of the annual incentive bonus amount earned by Executive
under the applicable Bonus Plan as established by Company’s Board of Directors
with respect to the three fiscal years preceding the fiscal year in which the
Termination of Employment occurs (or such lesser period of Executive’s
employment with the Company and its Affiliates).

 

5.4          “Cause”
means (a) Executive’s indictment for a felony or a crime involving moral
turpitude; (b) Executive’s commission of an act constituting fraud, deceit
or material misrepresentation with respect to Company; (c) Executive’s
recurrent use of alcohol or prescribed medications at work or otherwise such
that, in Company’s sole discretion; Executive’s job performance is impaired or
the use of any illegal substances or drug such that, in Company’s sole
discretion.  Executive’s job performance
is impaired; (d) Executive’s embezzlement of Company’s or its Affiliates’
assets or funds; and (e) Executive’s commission of any negligent or
willful act or omission that, in the cases of clauses (b), (d) and (e) of
this Section 5.4, causes material detriment (by reason, without limitation,
of financial exposure or loss, damage to reputation or goodwill, or exposure to
civil damages or criminal penalties or other prosecutorial action by any
governmental authority) to Company or any Affiliate.

 

5.5          “Change of Control”
means any of the following occurrences:

 

(a)           any “person,” as such term
is used in Sections 3(a)(9) and 13(d) of the Securities Exchange Act
of 1934 (“Person”), becomes a “beneficial owner,” as such term is used
in Rule 13d-3 promulgated under that Act, of 50% or more of the voting
stock of Company; provided, however, a Change in Control
shall not be deemed to occur solely because any person acquires beneficial
ownership of more than 50% of the 

 

15

 

voting stock of the Company
as a result of the acquisition of voting stock by the Company which reduces the
amount of Company voting stock outstanding; provided further, that if after
such acquisition by the Company such person becomes the beneficial owner of
additional Company voting stock that increases the percentage of outstanding
Company voting stock beneficially owned by such person, a Change in Control of
the Company shall then occur;

 

(b)           the majority of the Board of
Directors of Company consists of individuals other than “incumbent” directors,
which term means the members of the Board of Directors on the date hereof;
provided that any person becoming a director subsequent to such date whose
election or nomination for election was supported by two-thirds of the
directors who then comprised the incumbent directors will be considered to be
an incumbent director;

 

(c)           Company adopts any plan of
liquidation providing for the distribution of all or substantially all of its
assets;

 

(d)           all or substantially all of the assets or business of
Company is disposed of pursuant to a merger, consolidation or other transaction
(unless the stockholders of Company immediately prior to such merger,
consolidation or other transaction beneficially own, directly or indirectly, in
substantially the same proportion as they owned the voting stock of Company
immediately prior to such merger, consolidation or other transaction, all of
the voting stock or other ownership interests of the entity or entities, if
any, that succeed to the business of Company); or

 

(e)           Company combines with
another company and is the surviving corporation but, immediately after the
combination, the stockholders of Company immediately prior to the combination
hold, directly or indirectly, 50% or less of the voting stock of the combined
company (there being excluded from the number of shares held by such
stockholders, but not from the voting stock of the combined company, any shares
received by affiliates of such, other company in exchange for stock of such
other company).

 

For purposes of the Change
of Control definition, “Company” will include any entity that succeeds to all
or substantially all, of the business of Company and “voting stock” will mean
securities of any class or classes having general voting power under ordinary
circumstances, in the absence of contingencies, to elect the directors of a
corporation.

 

5.6          “COBRA”
means the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.

 

5.7          “Code”
means the Internal Revenue Code of 1986, as amended.

 

5.8          “Disability”
means, in Company’s sole discretion, Executive becomes mentally or physically
impaired or disabled such that he or she is unable to perform his or her duties
and responsibilities hereunder for a period of at least one hundred twenty
(120) days in the aggregate during any one hundred fifty (150) consecutive day
period.

 

5.9          “Equity Plan”
means any equity plan, agreement or arrangement maintained or sponsored by
Company in which Executive is a participant.

 

16

 

5.10        “401(k) Plan”
means the Zale Corporation Savings and Investment Plan or any other qualified
retirement plan with a cash or deferred arrangement that is maintained or
sponsored by Company or any Affiliate in which Executive is a participant.

 

5.11        “Protection Period”
means the period beginning on the date that is six months prior to the
occurrence of a Change of Control and ending twenty-four (24) months following
the occurrence of a Change of Control.

 

5.12        “Qualifying Termination”

 

(a)           In the case of any
Termination of Employment other than during a Protection Period, ‘‘Qualifying
Termination” shall mean:

 

(i)            the Termination of
Employment of Executive by Company for any reason other than Cause, Disability,
or death; or

 

(ii)           the Termination of
Employment of Executive by Executive for any of the following reasons:

 

(A)                          a material
reduction by Company in Executive’s base salary or bonus eligibility unless
similar reductions apply to senior executives of Company and its subsidiaries
generally;

 

(B)                            relocation of
Company’s principal executive offices outside the Dallas/Fort Worth, Texas
Metroplex; or

 

(C)                            the assignment
to Executive by Company of duties materially inconsistent with, or the material
reduction of the powers and functions associated with, Executive’s positions,
duties, responsibilities and status with Company or a material adverse change
in Executive’s titles or offices, unless such action is in lieu of termination
by Company of Executive’s employment due to Disability.

 

If Executive believes that an event specified
in this Section 5.12(a)(ii) has occurred.  Executive must notify Company of that belief
within ninety (90) days following the occurrence of such event.  Company will have thirty (30) days following
receipt of such notice (such period, the “Designated Period”) in which to
either rectify such event, determine that such an event exists, or determine
that such an event does not exist.  If
Company does not take any of the foregoing actions within the Designated Period, Executive may terminate his or her employment with Company
during the fourteen-day period following the expiration of the Designated
Period.  If, during the Designated
Period, Company determines that such an event exists Company shall either (A) undertake
to cure such event during the Designated Period and provide Executive with
written notice during the Designated Period of Company’s determination that
such event has been cured, or (B) provide written notice to Executive
during the Designated Period that it does not wish to cure such event, in which
case, Executive may terminate his or her employment during the fourteen-day
period following receipt of the notice specified in this clause (B).  If, during the Designated Period, Company
determines that (1) such event does not exist or (2) Company has
cured such event pursuant to clause (A) of the preceding sentence, then (x) Executive
will not be entitled to rely on 

 

17

 

or assert such event as a basis for a
Qualifying Termination; and (y) if Executive disagrees with Company’s
determination, Executive may file a claim pursuant to Article III within
thirty (30) days after Executive’s receipt of written notice of Company’s
determination.

 

(b)           In the case of any Termination of Employment during
a Protection Period, “Qualifying Termination” shall mean:

 

(i)            the Termination of
Employment of Executive by Company for any reason other than Cause, Disability,
or death; or

 

(ii)           the Termination of
Employment of Executive by Executive for any of the following reasons:

 

(A)                          the assignment
to Executive by Company of duties inconsistent with, or the reduction, other
than due solely to the fact that Company no longer is a publicly traded company
of the powers and functions associated with Executive’s position, duties,
responsibilities and status with the Company immediately prior to a Change of
Control, or a material adverse change in Executive’s titles or offices as in
effect immediately prior to a Change of Control, or any removal of Executive
from or any failure to re-elect Executive to any of such positions, except, in
each of the foregoing cases, in connection with Termination of Employment by
Company due to Cause, Disability, or death;

 

(B)                            a reduction by
Company in Executive’s base salary or bonus eligibility as in effect on the
date of a Change of Control;

 

(C)                            relocation of
Company’s principal executive offices outside the Dallas/Fort Worth, Texas
Metroplex;

 

(D)                           Company’s
requirement that Executive be based anywhere other than at Company’s principal
executive offices in the Dallas/Fort Worth, Texas Metroplex area, or if
Executive agrees to a relocation outside the area, Company’s failure to
reimburse Executive for moving and all other expenses incurred with such move;

 

(E)                             Company’s failure
to continue in effect any Company-sponsored plan that is in effect on the date
of a Change of Control (or replacement plans therefore that in the aggregate
provide substantially the same or more favorable benefits) that is either a
401(k) Plan or provides incentive or bonus compensation or reimbursement
for reasonable expenses incurred by Executive in connection with the
performance of duties with Company;

 

(F)                             any material
breach by Company of any provision of this Agreement; or

 

(G)                            any failure by Company
to obtain the assumption of this Agreement by any successor or assign of
Company.

 

18

 

If Executive believes that an event specified
in this Section 5.12(b)(ii) has occurred, Executive must notify Company
of that belief within ninety (90) days following the occurrence of such
event.  Company will have thirty (30)
days following receipt of such notice (such period, the “Designated Period”) in
which to either rectify such event determine that such an event exists, or
determine that such an event does not exist. 
If Company does not take any of the foregoing actions within the
Designated Period, Executive may terminate his or her employment with Company
during the fourteen-day period following the expiration of the Designated
Period.  If, during the Designated
Period, Company determines that such an event exists Company shall either (A) undertake
to cure such event during the Designated Period and provide Executive with
written notice during the Designated Period of Company’s determination that
such event has been cured, or (B) provide written notice to Executive
during the Designated Period that it does not wish to cure such event, in which
case, Executive may terminate his or her employment during the fourteen-day
period following receipt of the notice specified in this clause (B).  If, during the Designated Period, Company
determines that (1) such event does not exist or (2) Company has
cured such event pursuant to clause (A) of the preceding sentence, then (x) Executive
will not be entitled to rely on or assert such event as a basis for a
Qualifying Termination, and (y) if Executive disagrees with Company’s
determination, Executive may file a claim pursuant to Article III within
thirty (30) days after Executive’s receipt of written notice of Company’s
determination.

 

(c)           Notwithstanding anything to
the contrary contained herein, for purposes of Section 1.2, a Qualifying
Termination shall occur only to the extent that Executive incurs a “separation
from service” with Company within the meaning of Treasury Regulation Section 1.409A-1(h).

 

(d)           In the event that Executive
is employed by a subsidiary of Company, including Zale Delaware, Inc., and
not Company, for purposes of the term “Qualifying Termination,” “Company” will
include such subsidiary.

 

5.13        “Severance Pay”
means cash severance payments in an amount equal to the product of (a) the
sum of Executive’s Base Compensation as of Termination of Employment and, in
the cases of Sections 1.1 and 1.2, Bonus (as specified in Section 5.3),
and (b) the applicable Severance Period specified in Section 5.14 provided, however,
that in the event of payment under Sections 1.3 or 1.4, the amount of any
payment received by Executive pursuant to any death or disability plan or
insurance maintained by Company on Executive’s behalf shall be deducted from
any amounts payable pursuant to this Agreement.

 

19

 

5.14        “Severance Period”
means the following period, based on whether Executive’s Qualifying Termination
is during a Protection Period or due to Disability or death:

 

	
  QUALIFYING TERMINATION

  OTHER THAN DURING A

  PROTECTION PERIOD -

  SECTION 1.1

  	
   

  	
  QUALIFYING TERMINATION

  DURING A PROTECTION

  PERIOD - SECTION 1.2

  	
   

  	
  TERMINATION OF

  EMPLOYMENT DUE TO

  DISABILITY OR DEATH - 

  SECTIONS 1.3 AND 1.4

  
	
  6 months

  	
   

  	
  3 years

  	
   

  	
  6 months

  

 

5.15        “Termination of
Employment” means the date on which Executive ceases to perform
duties for Company or its Affiliate(s).

 

20

 

IN WITNESS WHEREOF, the
parties have executed this Agreement as of the date first above written.

 

ZALE
CORPORATION

 

 

	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  EXECUTIVE

  	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

21

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