Document:

_

Exhibit 10.1

EMPLOYMENT
AGREEMENT

            EMPLOYMENT
AGREEMENT dated as of November 15, 2005 (the "Effective Date"), by and between
Mohawk Industries, Inc., (the "Company") and W. Christopher Wellborn (the
"Executive").

The Company
desires to employ the Executive as Chief Operating Officer and the Executive
desires to accept such employment on the terms and conditions of this
Agreement.

            NOW, THEREFORE,
in consideration of the mutual premises and agreements herein contained, and
other good and valuable consideration, the receipt and adequacy of which is
acknowledged, the parties hereby agree as follows:

            1.         Term
of Employment.  The term of the Executive's employment under this Agreement
(the "Term") shall commence on the Effective Date and continue through and
expire on December 31, 2008 unless earlier separation from service occurs as
herein provided.  

 

            2.         Duties
of Employment.  The Executive hereby agrees for the Term to render his
exclusive services to the Company as its Chief Operating Officer, in connection
therewith, to perform such duties commensurate with his office as he shall
reasonably be directed by the Board of Directors of the Company (the "Board")
to perform.  The Executive shall devote during the Term all of his business
time, energy and skill to his executive duties hereunder and perform such
duties faithfully and efficiently, except for reasonable vacations and except
for periods of illness or incapacity.  When and if requested to do so by the
Board, the Executive shall, for no additional compensation, serve as a director
of the Company and/or a director or officer of any subsidiary or affiliate of
the Company, provided that the Executive shall be indemnified for liabilities
incurred by him in his capacity as a director or an officer in accordance with
an Indemnification Agreement as provided in the Company's Certificate of
Incorporation and By-Laws as in effect from time to time.  Executive shall not
be required or expected to serve as a director of the Company or any affiliate
or subsidiary of the Company upon his separation from service with the Company.

            4.         Compensation
and Other Benefits.

                        4.1       Salary. 
As compensation for all services to be rendered by the Executive during the
Term, the Company shall pay to the Executive a salary at the rate of $700,000
per year (which may be increased from time to time by the Board (the "Annual
Salary")), payable in accordance with the Company's usual payroll practices. 
The Executive shall be eligible to receive annual salary reviews and salary
increases as authorized by the Board.

                        4.2       Bonus. 
In addition to his Annual Salary, the Executive shall be eligible to be paid a
bonus in respect of each fiscal year of the Company (the "Annual Bonus") in
accordance with the Company's bonus plan (the "Plan"), which Annual Bonus shall
be determined by the Compensation Committee of the Board.  The amount of the
Annual Bonus shall be (i) 50% of the amount of the Annual Salary upon
attainment of the "threshold" performance goal established under the Plan as
determined by the Compensation Committee of the Board and the Board and (ii) a
"target" of 75% of the amount of the Annual Salary upon attainment of the
"target" performance goal established under the Plan as determined by the
Compensation Committee of the Board and the Board and (iii) a maximum of 100%
of the amount of the Annual Salary upon attainment of the "maximum" performance
goal established under the Plan as determined by the Compensation Committee of
the Board and the Board.

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                        4.3       Stock
Options.  Concurrent with the Effective Date of this Agreement, Mohawk will
grant non-statutory stock options (the "Options") to Executive to purchase
50,000 shares of Mohawk common stock in accordance with the terms and
provisions of the 2002 Mohawk Industries, Inc. Long Term Incentive Plan.  The
per-share exercise price of the Options shall be the fair market value of
Mohawk common stock on the date of grant of such Options, and twenty percent
(20%) of the Options shall vest and become exercisable on each of the first
five anniversaries respectively of the Effective Date of this Agreement.  In
the event (i) of a change in control of Mohawk or the Company; (ii) Executive
separates from service without Cause (as defined in Section 6.3 hereof); or
(iii) Executive separates from service for Good Reason (as defined in Section
6.4 hereof), the Options shall immediately vest and become fully exercisable,
and shall be transferable by Executive to the maximum extent permitted under
the 2002 Mohawk Industries, Inc. Long Term Incentive Plan.  The Options shall
remain exercisable for a ten-year period after the Effective Date.  The terms
and conditions of the Options shall be set forth in a written agreement (the
"Stock Option Agreement") and, other than as set forth herein, shall be
consistent with the terms and conditions of stock option agreements applicable
to comparable executives of Mohawk.  Mohawk agrees that Executive shall
participate in future grants of stock options in a manner comparable to similar
Mohawk executives.

                        4.4       Participation
in Employee Benefit Plans.  Commencing on the respective eligibility dates
of the employee benefit plans and subject to the terms of such employee benefit
plans, during the Term, the Executive shall be permitted to participate in any
group life, hospitalization or disability insurance plan, health program,
pension plan, similar benefit plan or other so-called "fringe benefit programs"
of the Company as now existing or as may hereafter be revised or adopted.

                        4.5       Vacation. 
The Executive shall be entitled to three (3) weeks vacation per annum.

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            5.         Covenants
by Executive.  In order to induce the Company to enter this Agreement and
the Stock Option Agreement, the Executive hereby agrees as follows:

                        5.1       Definitions.  The
following definitions shall apply to this Agreement.

                                    (i)         The term
"Trade Secret," whether in the singular or plural, means any Confidential
Information (as defined in Section 5.1(ii) below) which constitutes a trade
secret of the Company, or any of the Company's subsidiaries, under the Georgia
Trade Secrets Act of 1990, as amended, O.C.G.A. § 10-1-760, et seq.

                                    (ii)        The term
"Confidential Information" means any information, regardless of form,
concerning any aspect of the business of the Company, or the business of any of
the Company's subsidiaries, which is not generally known to the Company's
competitors and which the Company desires and makes reasonable efforts to keep
confidential.  Confidential Information includes, but is not limited to,
information relating to customers and potential customers, suppliers and
potential suppliers, contracts with customers and suppliers, employees,
personnel acquisition plans, pricing of products and services, financial
information, financial projections, budget information and procedures,
marketing plans and strategies, market research, technical processes, and
product research.  After the third anniversary of the Executive's separation
from the Company, Confidential Information shall not include any information
that does not constitute a Trade Secret.

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                        5.2       Acknowledgments of
Executive.  The Executive acknowledges that his work for the Company will
give him access to Trade Secrets and Confidential Information.  The Executive
further acknowledges that he inevitably would use, or inadvertently disclose,
Trade Secrets and Confidential Information if, at any time within three years
of his separation from the Company, he were to work or consult for any
competitor of the Company, or any of the Company's subsidiaries, in any
capacity requiring high-level management expertise with respect to any aspect
of the manufacture or distribution of commercial or residential floor covering.

                        5.3       Confidential Information. 
Except as required by his work for the Company, the Executive will not at any
time, either during or after his employment with the Company, communicate or
disclose to any person, firm, corporation or other entity, or use for his
benefit or for the benefit of any person, firm, corporation or other entity,
directly or indirectly, any Trade Secret or Confidential Information.

                        5.4       Company
Property.  All memoranda, notes, lists, records and other documents or
papers, (and all copies thereof), including such items stored in computer
memories, on microfiche or by any means, made or controlled by or on behalf of
the Executive, or made available to the Executive relating to the Company, or
any of the Company's subsidiaries, are and shall remain the Company's property
and shall be delivered to the Company upon the Executive's separation from the
Company, unless requested earlier by the Company.

                        5.5       Conflicts
of Interest.  During his employment with the Company, the Executive shall
at all times strictly comply with the Company's policies concerning conflicts
of interest.

                        5.6       Survival
of Obligations.  The Executive's obligations under this Section 5 shall survive
the Term of this Agreement and the Executive's employment with the Company.

            6.         Separation
from Service.

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                        6.1       Death. 
If the Executive dies during the Term, this Employment Agreement shall
terminate immediately, except that the Executive's legal representatives shall
be entitled to receive any Annual Salary to the extent such Annual Salary has
accrued and remains payable up to the date of the Executive's death (to be paid
in accordance with the Company's usual payroll practices), plus a portion of
the Executive's Annual Bonus, as set forth in Section 4.2 computed on a pro
rata basis based on the assumption that the Executive would have earned a
"target" bonus equal to 75% of Executive's Annual Salary (to be paid as promptly
as practicable but no later than 10 days after the date of Executive's death),
and any benefits to which the Executive, his heirs or legal representatives may
be entitled under and in accordance with the terms of any employee benefits
plan or program maintained by the Company.

                        6.2       Upon
Disability.  If the Executive becomes disabled during his employment
hereunder so that he is unable substantially to perform his services hereunder
for 180 consecutive days, then the term of this Agreement may be terminated by
resolution of the Board 60 days after the expiration of such 180 days, such
termination to be effective upon delivery of written notice to the Executive of
the adoption of such resolution; provided, that the Executive shall be entitled
to receive any accrued and unpaid Annual Salary through such effective date of
separation from service (to be paid in accordance with the Company's usual
payroll practices), plus a portion of the Executive's Annual Bonus, as set
forth in Section 4.2 computed on a pro rata basis based on the assumption that
the Executive would have earned a "target" bonus equal to 75% of Executive's
Annual Salary (to be paid as promptly as practicable but no later than 10 days
after the Executive's separation from service), and any benefit to which the
Executive may be entitled under and in accordance with the terms of any
employee benefit plan or program maintained by the Company.

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                        6.3       Separation
from Service for Cause.  The Company has the right, at any time during the
Term, subject to all of the provisions hereof, exercisable by serving notice,
effective in accordance with its terms, to separate the Executive from service
under this Agreement and discharge the Executive for "Cause" (as defined
below).  If such right is exercised, the Executive shall be entitled to receive
unpaid and accrued Annual Salary prorated through the date of such separation
from service, any benefits vested as of the date of such separation from
service, and any other compensation or benefits otherwise required to be paid
under applicable law.  Except for such payments, the Company shall be under no
further obligation to the Executive.  As used in this Section 5, the term
"Cause" shall mean and include (i) the conviction of or plea of guilty by the
Executive of any felony or other serious crime involving the Company, or (ii)
gross or willful misconduct by the Executive in the performance of his duties
hereunder; provided however, that no act shall be considered gross or willful
misconduct if the Executive reasonably believes he was acting in good faith or
in a manner not opposed to the interests of the Company.  The Company shall be
entitled to separate the Executive from service for Cause only upon approval of
a resolution adopted by the affirmative vote of not less than two-thirds of the
membership of  the  Board  (excluding Executive).  The Company agrees to
provide to the Executive prior written notice (the "Notice") of its intention
to separate the Executive from service for Cause, such notice to state in detail
the particular acts or failure to act which constitute grounds for the
separation from service.  The Executive shall be entitled to a hearing before
the Board to contest the Board's findings, and to be accompanied by counsel. 
Such hearing shall be held with 15 days of the request thereof to the Company
by the Executive, provided that such request must be made within 15 days of
delivery of the Notice.  If, following any such hearing, the Board maintains
its determination to separate the Executive's service for Cause, the effective
date of such separation from service shall be as specified in the Notice.

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                        6.4       Separation
from Service Without Cause.  The Company shall have the right at any time
during the Term to separate the Executive from service hereunder without
Cause.  Upon such a separation from service, or the separation from service by
the Executive for Good Reason, the Company's sole obligation hereunder, except
as otherwise provided in Section 4.3, shall be to pay (or, in the case of
benefits specified in clause (iii), provide) to the Executive: (i) an amount
equal to any Annual Salary accrued and due and payable to the Executive
hereunder on the date of separation from service (to be paid in accordance with
the Company's usual payroll practices); (ii) an amount equal to his Annual
Salary for the remainder of the Term (to be paid in a lump sum as promptly as
practicable, but no later than 10 days after the date of Executive's separation
from service); (iii) all benefits specified in Section 4.4 hereof in accordance
with the terms of such employee benefit plans; (iv) the greater of (A) a
portion of the Executive's Annual Bonus as set forth in Section 4.2 computed on
a pro-rated basis, based on the assumption that the Executive would have earned
a "target" bonus equal to 75% of Executive's Annual Salary or (B) an amount
equal to the amount of the Annual Bonus for the fiscal year preceding the
fiscal year in which the date of separation from service occurs, pro-rated
based on the number of days elapsed in the year of separation from service (to
be paid in a lump sum as promptly as practicable, but no later than 10 days
after the date of Executive's separation from service); and (v) a partial bonus
under any other bonus plan(s) in which the Executive is a participant computed
and determined in accordance with its terms, on a pro-rated basis based on the
performance of the Company from the beginning of the bonus period through the
date of separation from service (to be paid in a lump sum as promptly as practicable,
but no later than 10 days after the date of Executive's separation from
service).  For purposes of this Agreement, "Good Reason" shall mean (i) a
reduction in the Annual Salary or bonus opportunity as specified in Section 4.1
or 4.2, (ii) a material diminution in the Executive's duties or
responsibilities, (iii) an adverse change in the Executive's title, or (iv)
assignment to Executive of duties and responsibilities that are inconsistent
with his position in any material respect.  To
the extent required to comply with Section 409A of the Internal Revenue Code of
1986, as amended (the "Code"), as determined by the Company's outside counsel,
one or more payments under this Section 6.4 shall be delayed to the six-month
anniversary of the date of Executive's separation from service, within the
meaning of Code Section 409A.  If and to the extent required to prevent a
violation of Code Section 409A, Executive will pay the entire cost of any
health insurance coverage for the first six (6) months after separation from
service and the Company will reimburse Executive for the Company's share of
such costs on the six-month anniversary of Executive's separation from service,
as defined in Code Section 409A.

                        6.5       Other.  Except as
otherwise provided herein, upon the expiration or other termination of this
Agreement, including the resignation of Executive, all obligations of the
Company shall forthwith terminate, except as to any stock option rights as
provided in the Stock Option Agreement and except as otherwise required by
applicable law.

            7.         Expenses.

                        7.1       General. 
During the Term, the Executive will be reimbursed for his reasonable expenses
incurred for the benefits of the Company in accordance with the general policy
of the Company or directives and guidelines established by management of the
Company and upon submission of documentation satisfactory to the Company.  With
respect to any expenses that are to be reimbursed by the Company to the
Executive, the Executive shall be reimbursed upon his presenting to the Company
an itemized expense voucher.

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8 -

            8.         Provisions.

                        8.1       Notices. 
Any notice or other communication required or permitted hereunder shall be in
writing and shall be delivered personally, telegraphed, telexed, sent by
facsimile transmission, or sent by certified, registered or express mail,
postage prepaid.  Any such notice shall be deemed given when so delivered
personally, telegraphed, telexed, or sent by facsimile transmission or, if
mailed, five days after the date of deposit in the United States mail, as
follows:

                                    (i)         if to
the Company, to:

                                                Mohawk
Industries, Inc.

                                                160 S.
Industrial Boulevard

                                                Calhoun,
GA  30701

                                                Attention: 
General Counsel

                                    (ii)        if to
the Executive, to:

                                                W.
Christopher Wellborn

                                                908
Suffolk Court

                                                Southlake,
Texas  76092

Any party may change its
address for notice hereunder by notice to the other party hereto.

                        8.2       Entire
Agreement.  This Agreement and the Stock Option Agreement contain the
entire agreement between the parties with respect to the subject matter hereof
and supersede all prior agreements, written or oral, with respect thereto.

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                        8.3       Waivers
and Agreements.  This Agreement may be amended, modified, superseded,
cancelled, renewed or extended, and the terms and conditions hereof may be waived,
only by a written instrument signed by the parties or, in the case of a waiver,
by the party waiving compliance.  No delay on the part of any party in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any waiver on the part of any right, power or privilege
hereunder, nor any single or partial exercise of any right, power or privilege
hereunder preclude any other or further exercise thereof or the exercise of any
other right, power, or privilege hereunder.

                        8.4       Governing
Law.  This Agreement shall be governed by and construed in accordance with
the laws of the State of Georgia applicable to agreements made and to be
performed entirely within such State.  Any lawsuit arising out of or relating
to this Agreement shall be brought exclusively in the federal or state courts
located in the State of Georgia, and the Executive and the Company hereby
submit to personal jurisdiction in the State of Georgia and to venue in such
courts.

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                        8.5       
Successors, Binding Agreement, Assignment.   The Company will require any
successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of the
Company, by agreement in form and substance satisfactory to the Executive, to
expressly assume and agree to perform this Agreement in the same manner and to
the same extent that the Company would be required to perform it if no such
succession had taken place.  Failure of the Company to obtain such agreement prior
to the effectiveness of any such succession shall be a breach of this Agreement
and shall entitle the Executive to compensation from the Company in the same
amount and on the same terms as would apply if the Executive separated from
service pursuant to Section 6.4 hereof, except that for purposes of
implementing the foregoing, the date on which any such succession becomes
effective shall be deemed the date of separation from service.  As used in this
Agreement, "Company" shall mean the Company as hereinbefore defined
and any successor to its business and/or assets as aforesaid that executes and
delivers the agreement provided for in this section or which otherwise becomes
bound by all the terms and provisions of this Agreement by operation of law.  This
Agreement shall inure to the benefit of and be enforceable by the Executive's
personal or legal representatives, executors, administrators, successors,
heirs, distributees, devisees and legatees.  Executive may not delegate the
performance of any of his duties hereunder.  Neither party hereto may assign
any rights hereunder without the written consent of the other party hereto.

                        8.6       Counterparts. 
This Agreement may be executed in two counterparts, each of which shall be
deemed an original but both of which together shall constitute one and the same
instrument.

                        8.7       Headings. 
The headings in this Agreement are for reference purposes only and shall not in
any way affect the meaning or interpretation of this Agreement.

            9.         Arbitration. 
Except for disputes arising out of or pertaining to Section 5 of this
Agreement, any and all disputes arising out of or relating to this Agreement or
the breach, termination or validity thereof shall be settled by arbitration
before a sole arbitrator in accordance with the American Arbitration
Association's then current National Rules of the Resolution of Employment
Disputes (the "AAA Rules").  The arbitration shall be governed by the Federal
Arbitration Act, 9 U.S.C. § 116, and judgment upon the award rendered by the
arbitrator may be entered by any court having jurisdiction thereof.  The
arbitration shall be held in Atlanta, Georgia and, unless the parties agree
otherwise, the arbitrator shall be selected in accordance with the AAA Rules. 
In case of conflict, the provisions of this Section 9 shall prevail over the
AAA Rules.

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            Either party may
demand arbitration by sending to the other party by certified mail a written
notice of demand for arbitration, setting forth the matters to be arbitrated. 
The arbitrator shall have the authority to award only compensatory damages, and
neither party shall be entitled to written or deposition discovery from the
other.  The Company will pay the fees and expenses of the arbitrator, as well
as any attorneys' fees, expert witness fees, and other expenses.  The
arbitrator shall have no authority to alter, amend or modify any of the terms
and conditions of this Agreement.

            Before
arbitrating the dispute, the parties, if they so agree, may endeavor to settle
the dispute by mediation under the AAA Rules.  Unless otherwise agreed by the
parties, the mediator will be appointed by the American Arbitration Association
in accordance with the AAA Rules.  If the mediation is not successfully
concluded within thirty (30) days, the dispute will proceed to arbitration as
set forth above.   

            Notwithstanding the pendency of any dispute or
controversy concerning separation from service or the effects thereof, the
Company will continue to pay the Executive his full compensation in effect
immediately before any notice of separation from service giving rise to the
dispute was given and continue him as a participant in all compensation,
benefit and insurance plans in which he was then participating, until an award
has been entered by the arbitrator.  Any amounts paid hereunder shall be set
off against or reduced by any other amounts due under this Agreement.

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12 -

            10.  Legal
Fees and Expenses.   It is the intent of the Company that the Executive not
be required to incur the legal expenses associated with (i) the obtaining of
any right or benefit under this Agreement or (ii) the enforcement of his rights
under this Agreement by litigation or other legal action, because the cost and
expense thereof would substantially detract from the benefits intended to be
extended to the Executive hereunder.  Accordingly, the Company irrevocably
authorize the Executive from time to time to retain counsel of his choice, at
the expense of the Company and/or Mohawk as hereafter provided, to represent
the Executive in connection with the interpretation or enforcement of this
Agreement, including the initiation of any arbitration or the defense of any
arbitration or litigation, whether by or against the Company, or any Director,
officer, stockholder or other person affiliated with the Company.  The Company
shall pay or cause to be paid and shall be solely responsible for any and all
reasonable attorneys' and related fees and expenses incurred by the Executive
under this Section 10.   

IN WITNESS
WHEREOF, the parties have executed this Agreement as of the date first above
written.

                                                                                   

                                                                                    By:
/s/: W. Christopher Wellborn

                                                                                    Name: W.
Christopher Wellborn   

                                                                                    Title: Chief
Operating Officer  

 

                                                                                    MOHAWK
INDUSTRIES, INC.

                                                                                    By:
/s/:Salvatore J. Perillo    

                                                                                    Name:
Salvatore J. Perillo   

                                                                                    Title:
VP/General Council

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13 -exv4w1

 

Exhibit 4.1

FORM OF INDENTURE

 

SANDISK CORPORATION

as Issuer

and

THE BANK OF NEW YORK

as Trustee

INDENTURE

Dated as of May [___], 2006

[___]% Convertible Senior Notes due 2013

 

 

 

SANDISK CORPORATION

Reconciliation and tie between Trust Indenture Act of 1939 and

Indenture, dated as of May [__], 2006

	 	 	 	 	 
	Trust Indenture Act Section	 	Indenture Section	 
	§310(a)(1)
	 	 	6.09	 
	(a)(2)
	 	 	6.09	 
	(a)(3)
	 	 	Not Applicable	 
	(a)(4)
	 	 	Not Applicable	 
	(a)(5)
	 	 	6.09	 
	(b)
	 	 	6.08; 6.10; 6.11	 
	(c)
	 	 	Not Applicable	 
	§311(a)
	 	 	6.13	 
	(b)
	 	 	6.13	 
	§312(a)
	 	 	4.01; 4.02(a)	 
	(b)
	 	 	4.02(b)	 
	(c)
	 	 	4.02(c)	 
	§313(a)
	 	 	4.03(a)	 
	(b)
	 	 	4.03(a)	 
	(c)
	 	 	4.03(a)	 
	(d)
	 	 	4.03(b)	 
	§314(a)
	 	 	4.04(a)	 
	(b)
	 	 	Not Applicable	 
	(c)(1)
	 	 	3.07	 
	(c)(2)
	 	 	3.07	 
	(c)(3)
	 	 	Not Applicable	 
	(d)
	 	 	Not Applicable	 
	(e)
	 	 	3.07	 
	§315(a)
	 	 	6.01	 
	(b)
	 	 	5.08	 
	(c)
	 	 	6.01	 
	(d)
	 	 	6.01	 
	(e)
	 	 	5.09	 
	§316(a)
	 	 	1.01	 
	(a)(1)(A)
	 	 	7.01; 5.01	 
	(a)(1)(B)
	 	 	5.07	 
	(a)(2)
	 	 	Not Applicable	 
	(b)
	 	 	5.04	 
	(c)
	 	 	7.01	 
	§317(a)(1)
	 	 	5.03; 5.02; 5.05	 
	(a)(2)
	 	 	5.02	 
	(b)
	 	 	6.05; 11.01	 
	§318(a)
	 	 	1.02	 
	(c)
	 	 	1.02	 

 

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

i

 

Table of Contents

	 	 	 	 	 
	 	 	Page	 
	ARTICLE I
	 	 	 	 
	DEFINITIONS
	 	 	 	 
	 
	 	 	 	 
	Section 1.01. Definitions
	 	 	1	 
	 
	 	 	 	 
	Section 1.02. Incorporation by reference of Trust Indenture Act
	 	 	9	 
	 
	 	 	 	 
	ARTICLE II
	 	 	 	 
	ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES
	 	 	 	 
	 
	 	 	 	 
	Section 2.01. Designation and Amount
	 	 	10	 
	 
	 	 	 	 
	Section 2.02. Form of Notes
	 	 	10	 
	 
	 	 	 	 
	Section 2.03. Date and Denomination of Notes; Payments of Interest
	 	 	11	 
	 
	 	 	 	 
	Section 2.04. Date and Denomination of Note
	 	 	12	 
	 
	 	 	 	 
	Section 2.05. Execution, Authentication and Delivery of Notes
	 	 	12	 
	 
	 	 	 	 
	Section 2.06. Exchange and Registration of Transfer of Notes; Restrictions on Transfer; Depositary

	 	 	13	 
	 
	 	 	 	 
	
Section 2.07. Mutilated, Destroyed, Lost or Stolen Notes
	 	 	15	 
	 
	 	 	 	 
	Section 2.08. Temporary Notes
	 	 	16	 
	 
	 	 	 	 
	Section 2.09. Cancellation of Notes Paid, Etc.
	 	 	17	 
	 
	 	 	 	 
	Section 2.10. CUSIP Numbers
	 	 	17	 
	 
	 	 	 	 
	Section 2.11. Additional Notes, Repurchases
	 	 	17	 
	 
	 	 	 	 
	ARTICLE III
	 	 	 	 
	PARTICULAR COVENANTS OF THE COMPANY
	 	 	 	 
	 
	 	 	 	 
	Section 3.01. Payment of Principal Interest
	 	 	17	 
	 
	 	 	 	 
	Section 3.02. Maintenance of Office or Agency
	 	 	18	 
	 
	 	 	 	 
	Section 3.03. Appointments to Fill Vacancies in Trustee’s Office
	 	 	18	 
	 
	 	 	 	 
	Section 3.04. Provisions as to Paying Agent
	 	 	18	 
	 
	 	 	 	 
	Section 3.05. Existence
	 	 	19	 

i

 

	 	 	 	 	 
	 	 	Page	 
	Section 3.06. Stay, Extension and Usury Laws
	 	 	19	 
	 
	 	 	 	 
	Section 3.07. Compliance Certificate; Statements as to Defaults
	 	 	20	 
	 
	 	 	 	 
	Section 3.08. Further Instruments and Acts
	 	 	20	 
	 
	 	 	 	 
	ARTICLE IV
	 	 	 	 
	LISTS OF NOTEHOLDERS AND REPORTS BY THE COMPANY AND THE TRUSTEE
	 	 	 	 
	 
	 	 	 	 
	Section 4.01. Lists of Noteholders
	 	 	20	 
	 
	 	 	 	 
	Section 4.02. Preservation and Disclosure of Lists
	 	 	20	 
	 
	 	 	 	 
	Section 4.03. Reports by Trustee
	 	 	21	 
	 
	 	 	 	 
	Section 4.04. Reports by Company
	 	 	21	 
	 
	 	 	 	 
	ARTICLE V
	 	 	 	 
	DEFAULTS AND REMEDIES
	 	 	 	 
	 
	 	 	 	 
	Section 5.01. Events of Default
	 	 	21	 
	 
	 	 	 	 
	Section 5.02. Payments of Notes on Default; Suit Therefor
	 	 	23	 
	 
	 	 	 	 
	Section 5.03. Application of Monies Collected by Trustee
	 	 	25	 
	 
	 	 	 	 
	Section 5.04. Proceedings by Noteholders
	 	 	25	 
	 
	 	 	 	 
	Section 5.05. Proceedings by Trustee
	 	 	26	 
	 
	 	 	 	 
	Section 5.06. Remedies Cumulative and Continuing
	 	 	26	 
	 
	 	 	 	 
	Section 5.07. Direction of Proceedings and Waiver of Defaults by Majority of Noteholders
	 	 	27	 
	 
	 	 	 	 
	Section 5.08. Notice of Defaults
	 	 	27	 
	 
	 	 	 	 
	Section 5.09. Undertaking to Pay Costs
	 	 	27	 
	 
	 	 	 	 
	ARTICLE VI
	 	 	 	 
	CONCERNING THE TRUSTEE
	 	 	 	 
	 
	 	 	 	 
	Section 6.01. Duties and Responsibilities of Trustee
	 	 	28	 
	 
	 	 	 	 
	Section 6.02. Reliance on Documents, Opinions, Etc
	 	 	29	 
	 
	 	 	 	 
	Section 6.03. No Responsibility for Recitals, Etc
	 	 	31	 

ii

 

	 	 	 	 	 
	 	 	Page	 
	Section 6.04. Trustee, Paying Agents, Conversion Agents or Registrar May Own Notes

	 	 	31	 
	 
	 	 	 	 
	
Section 6.05. Monies to Be Held in Trust
	 	 	31	 
	 
	 	 	 	 
	Section 6.06. Compensation and Expenses of Trustee
	 	 	31	 
	 
	 	 	 	 
	Section 6.07. Officers’ Certificate as Evidence
	 	 	32	 
	 
	 	 	 	 
	Section 6.08. Conflicting Interests of Trustee
	 	 	32	 
	 
	 	 	 	 
	Section 6.09. Eligibility of Trustee
	 	 	33	 
	 
	 	 	 	 
	Section 6.10. Resignation or Removal of Trustee
	 	 	33	 
	 
	 	 	 	 
	Section 6.11. Acceptance by Successor Trustee
	 	 	34	 
	 
	 	 	 	 
	Section 6.12. Succession by Merger, Etc.
	 	 	34	 
	 
	 	 	 	 
	Section 6.13. Limitation on Rights of Trustee as Creditor
	 	 	35	 
	 
	 	 	 	 
	Section 6.14. Trustee’s Application for Instructions from the Company
	 	 	35	 
	 
	 	 	 	 
	ARTICLE VII
	 	 	 	 
	CONCERNING THE NOTEHOLDERS
	 	 	 	 
	 
	 	 	 	 
	Section 7.01. Action by Noteholders
	 	 	35	 
	 
	 	 	 	 
	Section 7.02. Proof of Execution by Noteholders
	 	 	36	 
	 
	 	 	 	 
	Section 7.03. Who Are Deemed Absolute Owners
	 	 	36	 
	 
	 	 	 	 
	Section 7.04. Company-Owned Notes Disregarded
	 	 	37	 
	 
	 	 	 	 
	Section 7.05. Revocation of Consents; Future Holders Bound
	 	 	37	 
	 
	 	 	 	 
	ARTICLE VIII
	 	 	 	 
	NOTEHOLDERS’ MEETINGS
	 	 	 	 
	Section 8.01. Purpose of Meetings
	 	 	37	 
	 
	 	 	 	 
	Section 8.02. Call of Meetings by Trustee
	 	 	38	 
	 
	 	 	 	 
	Section 8.03. Call of Meetings by Company or Noteholders
	 	 	38	 
	 
	 	 	 	 
	Section 8.04. Qualifications for Voting
	 	 	38	 
	 
	 	 	 	 
	Section 8.05. Regulations
	 	 	38	 

iii

 

	 	 	 	 	 
	 	 	Page	 
	Section 8.06. Voting
	 	 	39	 
	 
	 	 	 	 
	Section 8.07. No Delay of Rights by Meeting
	 	 	39	 
	 
	 	 	 	 
	ARTICLE IX
	 	 	 	 
	SUPPLEMENTAL INDENTURES
	 	 	 	 
	 
	 	 	 	 
	Section 9.01. Supplemental Indentures Without Consent of Noteholders
	 	 	40	 
	 
	 	 	 	 
	Section 9.02. Supplemental Indentures With Consent of Noteholders
	 	 	40	 
	 
	 	 	 	 
	Section 9.03. Effect of Supplemental Indentures
	 	 	42	 
	 
	 	 	 	 
	Section 9.04. Notation on Notes
	 	 	42	 
	 
	 	 	 	 
	Section 9.05. Evidence of Compliance of Supplemental Indenture to Be Furnished Trustee
	 	 	42	 
	 
	 	 	 	 
	ARTICLE X
	 	 	 	 
	CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
	 	 	 	 
	 
	 	 	 	 
	Section 10.01. Company May Consolidate, etc. on Certain Terms
	 	 	42	 
	 
	 	 	 	 
	Section 10.02. Successor Corporation to be Substituted
	 	 	43	 
	 
	 	 	 	 
	Section 10.03. Officer’s Certificate and Opinion of Counsel to Be Given Trustee
	 	 	43	 
	 
	 	 	 	 
	ARTICLE XI
	 	 	 	 
	SATISFACTION AND DISCHARGE OF INDENTURE
	 	 	 	 
	 
	 	 	 	 
	Section 11.01. Discharge of Indenture
	 	 	44	 
	 
	 	 	 	 
	Section 11.02. Deposited Monies to Be Held in Trust by Trustee
	 	 	44	 
	 
	 	 	 	 
	Section 11.03. Paying Agent to Repay Monies Held
	 	 	44	 
	 
	 	 	 	 
	Section 11.04. Return of Unclaimed Monies
	 	 	44	 
	 
	 	 	 	 
	Section 11.05. Reinstatement
	 	 	45	 
	 
	 	 	 	 
	ARTICLE XII
	 	 	 	 
	IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS
	 	 	 	 
	 
	 	 	 	 
	Section 12.01. Indenture and Notes Solely Corporate Obligations
	 	 	45	 

iv

 

	 	 	 	 	 
	 	 	Page	 
	ARTICLE XIII
	 	 	 	 
	CONVERSION OF NOTES
	 	 	 	 
	 
	 	 	 	 
	Section 13.01. Conversion Privilege
	 	 	45	 
	 
	 	 	 	 
	Section 13.02. Conversion Procedure
	 	 	48	 
	 
	 	 	 	 
	Section 13.03. [Intentionally Omitted]
	 	 	51	 
	 
	 	 	 	 
	Section 13.04. Adjustment of Conversion Rate
	 	 	51	 
	 
	 	 	 	 
	Section 13.05. Shares to Be Fully Paid
	 	 	59	 
	 
	 	 	 	 
	Section 13.06. Effect of Reclassification, Consolidation, Merger or Sale
	 	 	59	 
	 
	 	 	 	 
	Section 13.07. Certain Covenants
	 	 	61	 
	 
	 	 	 	 
	Section 13.08. Responsibility of Trustee
	 	 	61	 
	 
	 	 	 	 
	Section 13.09. Notice to Holders Prior to Certain Actions
	 	 	62	 
	 
	 	 	 	 
	Section 13.10. Shareholder Rights Plans
	 	 	63	 
	 
	 	 	 	 
	ARTICLE XIV
	 	 	 	 
	REPURCHASE OF NOTES AT OPTION OF HOLDERS
	 	 	 	 
	 
	 	 	 	 
	Section 14.01. Repurchase at Option of Holders Upon a Designated Event
	 	 	63	 
	 
	 	 	 	 
	ARTICLE XV
	 	 	 	 
	MISCELLANEOUS PROVISIONS
	 	 	 	 
	 
	 	 	 	 
	Section 15.01. Provisions Binding on Company’s Successors
	 	 	66	 
	 
	 	 	 	 
	Section 15.02. Official Acts by Successor Corporation
	 	 	66	 
	 
	 	 	 	 
	Section 15.03. Addresses for Notices, Etc.
	 	 	66	 
	 
	 	 	 	 
	Section 15.04. Governing Law
	 	 	67	 
	 
	 	 	 	 
	Section 15.05.
Evidence of Compliance with Conditions Precedent;

 Certificates and Opinions of Counsel to Trustee
	 	 	67	 
	 
	 	 	 	 
	Section 15.06. Legal Holidays
	 	 	67	 
	 
	 	 	 	 
	Section 15.07. No Security Interest Created
	 	 	67	 
	 
	 	 	 	 
	Section 15.08. Benefits of Indenture
	 	 	68	 
	 
	 	 	 	 
	Section 15.09. Table of Contents, Headings, Etc.
	 	 	68	 
	 
	 	 	 	 
	Section 15.10. Authenticating Agent
	 	 	68	 
	 
	 	 	 	 
	Section 15.11. Execution in Counterparts
	 	 	69	 

v

 

     INDENTURE dated as of May [___], 2006 between SanDisk Corporation, a Delaware corporation, as
issuer (hereinafter sometimes called the “Company”, as more fully set forth in Section 1.01), and
The Bank of New York, a New York banking corporation, as trustee (hereinafter sometimes called the “Trustee”, as more fully set
forth in Section 1.01).

WITNESSETH:

     WHEREAS, for its lawful corporate purposes, the Company has duly authorized the issue of its
[___]% Convertible Senior Notes due 2013 (hereinafter sometimes called the “Notes”), initially in
an aggregate principal amount not to exceed $[________] (or $[________] if the Underwriters
exercise their option to purchase additional Notes in full as set forth in the Underwriting
Agreement), and in order to provide the terms and conditions upon which the Notes are to be
authenticated, issued and delivered, the Company has duly authorized the execution and delivery of
this Indenture; and

     WHEREAS, the Notes, the certificate of authentication to be borne by the Notes, a form of
assignment, a form of the Designated Event Repurchase Notice, a form of conversion notice are to be
substantially in the forms hereinafter provided for; and

     WHEREAS, all acts and things necessary to make the Notes, when executed by the Company and
authenticated and delivered by the Trustee or a duly authorized authenticating agent, as in this
Indenture provided, the valid, binding and legal obligations of the Company, and to constitute
these presents a valid agreement according to its terms, have been done and performed, and the
execution of this Indenture and the issue hereunder of the Notes have in all respects been duly
authorized.

     NOW, THEREFORE, THIS INDENTURE WITNESSETH:

     That in order to declare the terms and conditions upon which the Notes are, and are to be,
authenticated, issued and delivered, and in consideration of the premises and of the purchase and
acceptance of the Notes by the holders thereof, the Company covenants and agrees with the Trustee
for the equal and proportionate benefit of the respective holders from time to time of the Notes
(except as otherwise provided below), as follows:

ARTICLE I

DEFINITIONS

          Section 1.01.   Definitions.

     (a) The terms defined in this Section 1.01 (except as herein otherwise expressly provided or
unless the context otherwise requires) for all purposes of this Indenture and of any indenture
supplemental hereto shall have the respective meanings specified in this Section 1.01. All other
terms used in this Indenture, which are defined in the Trust Indenture Act or which are by
reference therein defined in the Securities Act (except as herein otherwise expressly provided or unless the context otherwise requires) shall have the meanings assigned to such terms in
said Trust Indenture Act and in said Securities Act as in force at the date of the execution of
this

 

 

Indenture. If any provision hereof limits, qualifies or conflicts with another provision
hereof which is required to be included in this Indenture by any of the provisions of the Trust
Indenture Act, such required provision shall control. The words “herein,” “hereof,” “hereunder,”
and words of similar import refer to this Indenture as a whole and not to any particular Article,
Section or other Subdivision. The terms defined in this Article include the plural as well as the
singular.

     “Additional Shares” shall have the meaning specified in Section 13.01(e).

     “Adjustment Determination Date” shall have the meaning specified in Section 13.04(j).

     “Adjustment Event” shall have the meaning specified in Section 13.04(j).

     “Affiliate” of any specified person means any other person directly or indirectly controlling
or controlled by or under direct or indirect common control with such specified person. For the
purposes of this definition, “control,” when used with respect to any specified person means the
power to direct or cause the direction of 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.

     “Beneficial
Owner” and “Beneficial Ownership” means as
determined in accordance with Rule 13d-3 under the Exchange Act.

     “Board
of Directors” means the Board of Directors of the Company or a committee of such Board
duly authorized to act for it hereunder.

     “Board Resolution” means a copy of a resolution certified by the Secretary or an Assistant
Secretary of the Company to have been duly adopted by the Board of Directors, or duly authorized
committee thereof (to the extent permitted by applicable law), and to be in full force and effect
on the date of such certification, and delivered to the Trustee.

     “Business Day” means any day, except a Saturday, Sunday or legal holiday on which banking
institutions in The City of New York or the city in which the Corporate Trust Office is located are
authorized or obligated by law or executive order to close.

     “Capital Lease” means a lease that, in accordance with accounting principles generally
accepted in the United States of America, would be recorded as a capital lease on the balance sheet
of the lessee.

     “Capital Stock” means, for any entity, any and all shares, interests, rights to purchase,
warrants, options, participations or other equivalents of or interests in (however designated)
stock issued by that entity.

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

     “Code” means the Internal Revenue Code of 1983, as amended.

     “Commission” means the Securities and Exchange Commission.

2

 

     “Common Stock” means, subject to Section 13.06, shares of common stock of the Company, par
value $0.001 per share, at the date of this Indenture or shares of any class or classes resulting
from any reclassification or reclassifications thereof and that have no preference in respect of
dividends or of amounts payable in the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Company and that are not subject to redemption by the Company;
provided that if at any time there shall be more than one such resulting class, the shares of each
such class then so issuable shall be substantially in the proportion which the total number of
shares of such class resulting from all such reclassifications bears to the total number of shares
of all such classes resulting from all such reclassifications.

     “Company” means SanDisk Corporation, a Delaware corporation, and subject to the provisions of
Article X, shall include its successors and assigns and, to the
extent the obligations hereunder shall be to more than one entity
pursuant to Section 13.06, shall include each of such entities.

     “Company Order” means a written order of the Company, signed by (a) the Company’s Chief
Executive Officer, President, Executive or Senior Vice President, Managing Director or any Vice
President (whether or not designated by a number or numbers or word or words added before or after
the title “Vice President”) and (b) any such other officer designated in (a) or the Company’s
Treasurer or Assistant Treasurer or Secretary or any Assistant Secretary, and delivered to the
Trustee.

     “Conversion Agent” shall have the meaning specified in Section 3.02.

     “Conversion Date” shall have the meaning specified in Section 13.02(c).

     “Conversion Obligation” shall have the meaning specified in Section 13.01(a).

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

     “Conversion Rate” shall have the meaning specified in Section 13.01(a).

     “Corporate Trust
 Office” or other similar term means the principal corporate trust office of
the Trustee at which at any particular time its corporate trust business shall be principally
administered, which office is, at the date as of which this Indenture is dated, located at The Bank
of New York, 101 Barclay Street, Floor 21 West, New York, New York
10286, Attention:
Corporate Trust Administration; SanDisk Corporation.

     “Custodian” means The Bank of New York, as custodian for The Depository
Trust Company, with respect to the Notes in global form, or any successor entity thereto.

     “Daily Conversion Value” means, for each of the 20 consecutive Trading Days during the
Observation Period, one-twentieth (1/20) of the product of (a) the applicable Conversion Rate and
(b) the Daily VWAP of the Common Stock (or the Reference Property pursuant to Section 13.06) on
such day, as determined by the Company. Any such determination by the Company will be conclusive absent manifest error.

3

 

     “Daily Settlement Amount,” for each of the 20 Trading Days during the Observation Period,
shall consist of:

          (i) cash equal to the lesser of $50 and the Daily Conversion Value relating to such
day; and

          (ii) if such Daily Conversion Value exceeds $50, a number of shares of Common Stock
equal to (A) the difference between such Daily Conversion Value and $50, divided by (B) the
Daily VWAP of the Common Stock for such day.

     “Daily VWAP” for the Common Stock means, for each of the 20 consecutive Trading Days during
the Observation Period, the per share volume-weighted average price as displayed under the heading
“Bloomberg VWAP” on Bloomberg page SNDK <equity> [AQR] in respect of the period from 9:30
a.m. to 4:00 p.m. (New York City time) on such Trading Day (or if such volume-weighted average
price is unavailable, the market value of one share of Common Stock on such Trading Day as the
Board of Directors determines in good faith using a volume-weighted method).

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

     “Defaulted Interest” shall have the meaning specified in Section 2.03.

     “Depositary” means, with respect to the Notes issuable or issued in whole or in part in global
form, the person specified in Section 2.06(d) as the Depositary with respect to such Notes, until a
successor shall have been appointed and become such pursuant to the applicable provisions of this
Indenture, and thereafter, “Depositary” shall mean or include such successor.

     “Designated Event” means the occurrence of either a Fundamental Change or a Termination of
Trading.

     “Designated Event Company Notice” shall have the meaning specified in Section 14.02(b).

     “Designated Event Expiration Time” shall have the meaning specified in Section 14.02(b).

     “Designated Event Repurchase Date” shall have the meaning specified in Section 14.02(a).

     “Designated Event Repurchase Notice” shall have the meaning specified in Section 14.02(a)(i).

     “Designated Event Repurchase Price” shall have the meaning specified in Section 14.02(a).

     “Distributed Property” shall have the meaning specified in Section 13.04(c).

4

 

     “Effective Date” shall have the meaning specified in Section 13.01(e).

     “Event of Default” means, with respect to the Notes, any event specified in Section 5.01,
continued for the period of time, if any, and after the giving of notice, if any, therein
designated.

     “Ex-Dividend Date” means, (a) with respect to Section 13.01(b), the first date upon which a
sale of the Common Stock does not automatically transfer the right to receive the relevant dividend
from the seller of the Common Stock to its buyer, and (b) in all other cases, with respect to any
issuance or distribution on the Common Stock or any other equity security, the first date on which
the shares of Common Stock or such other equity security trade on the applicable exchange or in the
applicable market, regular way, without the right to receive such issuance or distribution.

     “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder.

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

	      
	(1)
	  	any
Person acquires Beneficial Ownership, directly or indirectly, through
a purchase, merger or other acquisition transaction or series of
transactions, of shares of the Company’s Capital Stock entitling
the person to exercise 50% or more of the total voting power of all
shares of the Company’s Capital Stock entitled to vote generally
in elections of directors, other than an acquisition by the Company,
any of the Company’s Subsidiaries or any of the Company’s
employee benefit plans;

	 
	      
	(2)
	  
	the
Company merges, or consolidates with or into any other Person (other
than a Subsidiary), another Person merges with or into the Company,
or the Company conveys, sells, transfers or leases all or
substantially all of the Company’s assets to another Person,
other than any transaction:

	      
	 
	 	•	that
does not result in a reclassification, conversion, exchange or
cancellation of Company’s outstanding Common Stock;

	 
	      
	 
	 	•	pursuant
to which the holders of the Company’s Common Stock immediately
prior to the transaction have the entitlement to exercise, directly
or indirectly, 50% or more of the voting power of all shares of
Capital Stock entitled to vote generally in the election of directors
of the continuing or surviving corporation immediately after the
transaction; or

	 
	      
	 
	 	•	which is
effected solely to change the Company’s jurisdiction of incorporation
and results in a reclassification, conversion or exchange of
outstanding shares of the Company’s Common Stock solely into shares
of common stock of the surviving entity.

However,
notwithstanding the foregoing, Noteholders will not have the right to
require the Company to repurchase any Notes under clauses (1) or
(2) above (and the Company will not be required to deliver the
Fundamental Change Repurchase Right Notice incidental thereto) if at
least 90% of the consideration paid for the Company’s Common
Stock (excluding cash payments for fractional shares and cash
payments made pursuant to dissenters’ appraisal rights) in a
merger or consolidation or a conveyance, sale, transfer or lease
otherwise constituting a Fundamental Change under clause (2)
above consists of shares of common stock traded on NASDAQ National
Market or a U.S. national securities exchange or quoted on another
established automated over-the-counter trading market in the United
States (or will be so traded or quoted immediately following the
merger or consolidation) and, as a result of the merger or
consolidation, the Notes become convertible into such shares of such
common stock.

     “Global Note” shall have the meaning specified in Section 2.06(b).

     “Indebtedness” as applied to any Person, means (i) obligations, contingent or otherwise, for
money borrowed (other than unamortized debt discount or premium); (ii) reimbursement and other
obligations pertaining to letters of credit issued for the account of such Person; (iii)
obligations under any swap, cap, collar, forward purchase contract, derivatives contract or other
similar agreement pursuant to which such Person hedges risks related to interest rates, currency
exchange rates, commodity prices, financial market conditions or other risks incurred by such
Person in the operation of its business; (iv) obligations evidenced by bonds, debentures,
promissory notes or other instruments or arrangements; (v) obligations as lessee under a Capital
Lease; and (vi) obligations of such Person under any amendments, renewals, extensions,
modifications and refundings of any such Indebtedness or obligations listed in clause (i), (ii),
(iii), (iv) or (v) above. All indebtedness of any type described in the immediately preceding
sentence which is secured by a lien upon property owned by such Person, although such Person has
not assumed or become liable for the payment of such Indebtedness, shall for all purposes be deemed
to be Indebtedness of such Person. All indebtedness for borrowed money incurred by any other
Persons which is directly guaranteed as to payment of principal by such Person shall for all
purposes be deemed to be Indebtedness of such Person, but no other contingent obligation of such
Person in respect of indebtedness incurred by any other Persons shall for any purpose be deemed to
be indebtedness of such Person.

5

 

     “Indenture” means this instrument as originally executed or, if amended or supplemented as
herein provided, as so amended or supplemented.

     “Interest Payment Date” means May 15 and November 15 of each year, beginning on November 15,
2006.

     “Last Reported Sale Price” means, with respect to the Common Stock or any other security for
which a Last Reported Sale Price must be determined, on any date, the closing sale price per share
of the Common Stock or unit of such other security (or, if no closing sale price is reported, the
average of the last bid and last ask prices or, if more than one in either case, the average of the
average last bid and the average last ask prices) on such date as reported by NASDAQ National
Market, or if the Common Stock is not then traded on NASDAQ National Market, on the principal
U.S. national or regional securities exchange on which it is then listed, if any. If the Common
Stock or such other security is not listed for trading on a United States national or regional
securities exchange and not reported by NASDAQ National Market on the relevant date, the Last
Reported Sale Price shall be the last quoted bid price per share of Common Stock or such other
security in the over-the-counter market on the relevant date, as reported by the National Quotation
Bureau or similar organization. In absence of such quotation, the Last Reported Sale Price shall
be the average of the mid-point of the last bid and asked prices for the Common Stock or such other
security on the relevant date from each of at least three nationally recognized independent
investment banking firms selected from time to time by the Board of Directors of the Company for
that purpose. The Last Reported Sale Price shall be determined without reference to extended or
after hours trading. Any such determination by the Company will be conclusive absent manifest
error.

     “Market Disruption Event” means the occurrence or existence for more than a one-half hour
period in the aggregate on any scheduled Trading Day for the Common Stock of any suspension or
limitation imposed on trading (by reason of movements in price exceeding limits permitted by NASDAQ National Market or otherwise) in the Common Stock or in any options, contracts or future
contracts relating to the Common Stock, and such suspension or limitation occurs or exists at any
time before 1:00 p.m. (New York City time) on such day.

     “Maturity Date” means May [___], 2013.

     “Measurement Period” shall have the meaning specified in Section 13.01(a)(i).

     “Merger Event” shall have the meaning specified in Section 13.06.

     “NASDAQ National Market” shall mean the NASDAQ National Market of The NASDAQ Stock Market,
Inc. and any successor market or exchange.

     “Note” or “Notes” means any note or notes, as the case may be, authenticated and delivered
under this Indenture.

     “Noteholder” or “holder,” as applied to any Note, or other similar terms (but excluding the
term “beneficial holder”), means any person in whose name at the time a particular Note is
registered on the Note register.

6

 

     “Note register” shall have the meaning specified in Section 2.06(a).

     “Note Registrar” shall have the meaning specified in Section 2.06(a).

     “Notice of Conversion” shall have the meaning specified in Section 13.02(c).

     “Observation Period” means the 20 consecutive Trading Day period beginning on and including
the second Trading Day after the related Conversion Date in respect of such Note.

     “Officers’ Certificate,” when used with respect to the Company, means a certificate signed by
(a) one of the President, the Chief Executive Officer, any Executive or Senior Vice President,
Managing Director or any Vice President (whether or not designated by a number or numbers or word
added before or after the title “Vice President”) and (b) by any such other officer designated in
(a) or by one of the Treasurer or any Assistant Treasurer, Secretary or any Assistant Secretary or
Controller of the Company, which is delivered to the Trustee. Each such certificate shall include
the statements provided for in Section 15.05 if and to the extent required by the provisions of
such Section. One of the officers giving an Officers’ Certificate pursuant to Section 5.08 shall
be the principal executive, financial or accounting officer of the Company.

     “Opinion of Counsel” means an opinion in writing signed by legal counsel, who may be an
employee of or counsel to the Company, or other counsel acceptable to the Trustee, which is
delivered to the Trustee. Each such opinion shall include the statements provided for in Section
15.05 if and to the extent required by the provisions of such Section.

     “outstanding,” when used with reference to Notes, shall, subject to the provisions of Section
7.04, mean, as of any particular time, all Notes authenticated and delivered by the Trustee under
this Indenture, except:

     (i) Notes theretofore canceled by the Trustee or accepted by the Trustee for
cancellation,

     (ii) Notes, or portions thereof, for the payment or repurchase of which monies in the
necessary amount shall have been deposited in trust with the Trustee or with any Paying
Agent (other than the Company) or shall have been set aside and segregated in trust by the
Company (if the Company shall act as its own Paying Agent);

     (iii) Notes in lieu of which, or in substitution for which, other Notes shall have been
authenticated and delivered pursuant to the terms of Section 2.07 unless proof satisfactory
to the Trustee is presented that any such Notes are held by protected purchasers in due
course; and

     (iv) Notes converted pursuant to Article XIII.

     “Paying Agent” shall have the meaning specified in Section 3.02.

     “Person” means an individual, a corporation, a limited liability company, an association, a
partnership, a joint venture, a joint stock company, a trust, an unincorporated organization or a
government or an agency or a political subdivision thereof, including
any syndicate or group that would be deemed to be a
“person” under Section 13(d)(3) of the Exchange Act.

7

 

     “Predecessor Note” of any particular Note means every previous Note evidencing all or a
portion of the same debt as that evidenced by such particular Note; and, for the purposes of this
definition, any Note authenticated and delivered under Section 2.07 in lieu of a lost, destroyed or
stolen Note shall be deemed to evidence the same debt as the lost, destroyed or stolen Note that it
replaces.

     “Principal Return” shall have the meaning assigned to it in clause (i) of the definition of
“Daily Settlement Amount.”

     “record date,” with respect to the payment of interest on any Interest Payment Date, shall
have the meaning specified in Section 2.03.

     “Reference
Property” shall have the meaning specified in Section 13.06(b).

     “Responsible Officer,” when used with respect to the Trustee, shall mean an officer of the
Trustee in the Corporate Trust Office, having direct responsibility for the administration of this
Indenture, and also, with respect to a particular matter, any other officer to whom such matter is
referred because of such officer’s knowledge of and familiarity with the particular subject.

     “Rights Plan” means that certain Rights Agreement dated September 15, 2003 between the Company
and Computershare Trust Company, Inc., as rights agent, as amended from time to time.

     “Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder.

     “Spin-Off” shall have the meaning specified in Section 13.04(c).

     “Significant Subsidiary” means such Subsidiary of the Company as meets the definition of
“significant subsidiary” in Rule 1-02 of Regulation S-X promulgated by the Commission as in effect
on the original date of issuance of the Notes.

     “Stock Price” means the price paid per share of Common Stock in connection with a Fundamental
Change pursuant to which Additional Shares shall be added to the Conversion Rate as set forth in
Section 13.01(d) hereof, which shall be equal to (i) if holders of Common Stock receive only cash
in such Fundamental Change, the cash amount paid per share of Common Stock and (ii) in all other
cases, the average of the Last Reported Sale Prices of the Common Stock over the five consecutive
Trading Day period ending on the Trading Day preceding the Effective Date of the Fundamental
Change.

     “Subsidiary” of the Company means (i) a corporation a majority of whose Capital Stock with
voting power, under ordinary circumstances, to elect directors is at the time, directly or
indirectly, owned by the Company, by the Company and one or more Subsidiaries of the Company or by
one or more Subsidiaries of the Company or (ii) any other Person (other than a corporation) in
which the Company, one or more Subsidiaries of the Company or the Company and one or more
Subsidiaries of the Company, directly or indirectly, at the date of determination thereof, has
greater than a 50% ownership interest.

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     “Successor Company” shall have the meaning specified in Section 10.01(a).

     “Termination of Trading” means the occurrence if the Common Stock is neither listed for
trading on a U.S. national securities exchange nor approved for trading on NASDAQ National
Market (at a time when NASDAQ National Market is not a U.S. national securities exchange).

     “Trading Day” means a day during which (a) trading in Common Stock generally occurs, (b) there
is no Market Disruption Event and (c) a Last Reported Sale Price for Common Stock (other than a
Last Reported Sale Price referred to in the next to last sentence of such definition) is available
for such day; provided that if the Common Stock is not admitted for trading or quotation on or by
any exchange, bureau or other organization referred to in the definition of Last Reported Sale
Price (excluding the next to last sentence of that definition), Trading Date shall mean any
Business Day.

     “Trading Price” with respect to the Notes, on any date of determination, means the average of
the secondary market bid quotations obtained by the Trustee for $2.0 million principal amount of
Notes at approximately 3:30 p.m., New York City time, on such determination date from three
independent nationally recognized securities dealers selected by the Company; provided that if
three such bids cannot reasonably be obtained by the Trustee, but two such bids are obtained, then
the average of the two bids shall be used, and if only one such bid can reasonably be obtained by
the Trustee, that one bid shall be used. If the Trustee cannot reasonably obtain at least one bid
for $2.0 million principal amount of Notes from a nationally recognized securities dealer, then the
Trading Price per $1,000 principal amount of Notes will be deemed to be equal to the product of the
Last Reported Sale Price of the Common Stock (as provided to the
Trustee by the Company) and the Conversion Rate. Any such determination by
the Trustee will be conclusive absent manifest error.

     “transfer” shall have the meaning specified in Section 2.06(d).

     “Trigger Event” shall have the meaning specified in Section 13.04(c).

     “Trust Indenture Act” means the Trust Indenture Act of 1939, as amended, as it was in force at
the date of execution of this Indenture; provided however, that in the event the Trust Indenture
Act of 1939 is amended after the date hereof, the term “Trust Indenture Act” shall mean, to the
extent required by such amendment, the Trust Indenture Act of 1939, as so amended.

     “Trustee” means The Bank of New York, and its successors and any
corporation resulting from or surviving any consolidation or merger to which it or its successors
may be a party and any successor trustee at the time serving as successor trustee hereunder.

     “Underwriting Agreement” means that certain Underwriting Agreement, dated May [___], 2006,
among the Company and the Underwriters.

          Section 1.02.   Incorporation by reference of Trust Indenture Act.

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     This Indenture is subject to the mandatory provisions of the Trust Indenture Act, which are
incorporated by reference in and made a part of this Indenture. The following Trust Indenture Act
terms have the following meanings:

     “indenture securities” means the Notes.

     “indenture security holder” means a Holder.

     “indenture to be qualified” means this Indenture.

     “indenture trustee” or “institutional trustee” means the Trustee.

     “obligor” on the indenture securities means the Company and any other obligor on the indenture
securities.

     All other terms in this Indenture that are defined by the Trust Indenture Act, defined by it
by reference to another statute or defined by Commission rule have the meanings assigned to them by
such definitions. If any provision hereof limits, qualifies or conflicts with another provision
hereof which is required to be included in this Indenture by the Trust Indenture Act, such required
provision shall control.

ARTICLE II

ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES

          Section 2.01.   Designation and Amount. The Notes shall be designated as the “[___]%
Convertible Senior Notes due 2013.” The aggregate principal amount of Notes that may be
authenticated and delivered under this Indenture is initially limited to $[___] (or
$[___] if the Underwriters exercise their option to purchase additional Notes in full as
set forth in the Underwriting Agreement), subject to Section 2.11 and except for Notes
authenticated and delivered upon registration or transfer of, or in exchange for, or in lieu of
other Notes pursuant to Section 2.06, Section 2.07, Section 9.04, Section 13.02 and Section 14.02
hereof.

          Section 2.02.   Form of Notes. The Notes and the Trustee’s certificate of authentication to
be borne by such Notes shall be substantially in the form set forth in Exhibit A.

     Any of the Notes may have such letters, numbers or other marks of identification and such
notations, legends or endorsements as the officers executing the same may approve (execution
thereof to be conclusive evidence of such approval) and as are not inconsistent with the provisions
of this Indenture, or as may be required to comply with any law or with any rule or regulation made
pursuant thereto or with any rule or regulation of any securities exchange or automated quotation
system on which the Notes may be listed or designated for issuance, or to conform to usage or to indicate any special limitations or restrictions to which any
particular Notes are subject.

     The Global Note shall represent such principal amount of the outstanding Notes as shall be
specified therein and shall provide that it shall represent the aggregate principal amount of

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outstanding Notes from time to time endorsed thereon and that the aggregate principal amount of
outstanding Notes represented thereby may from time to time be increased or reduced to reflect
repurchases, conversions, transfers or exchanges permitted hereby. Any endorsement of the Global
Note to reflect the amount of any increase or decrease in the amount of outstanding Notes
represented thereby shall be made by the Trustee or the Custodian, at the direction of the Trustee,
in such manner and upon instructions given by the holder of such Notes in accordance with this
Indenture. Payment of principal and accrued and unpaid interest on the Global Note shall be made
to the holder of such Note on the date of payment, unless a record date or other means of
determining holders eligible to receive payment is provided for herein.

     The terms and provisions contained in the form of Note attached as Exhibit A hereto are
incorporated herein and shall constitute, and are hereby expressly made, a part of this Indenture
and to the extent applicable, the Company and the Trustee, by their execution and delivery of this
Indenture, expressly agree to such terms and provisions and to be bound thereby.

          Section 2.03.   Date and Denomination of Notes; Payments of Interest. The Notes shall be
issuable in registered form without coupons in denominations of $1,000 principal amount and
integral multiples thereof. Each Note shall be dated the date of its authentication and shall bear
interest from the date specified on the face of the form of Note attached as Exhibit A hereto.
Interest on the Notes shall be computed on the basis of a 360-day
year comprised of twelve 30-day
months.

     The Person in whose name any Note (or its Predecessor Note) is registered on the Note register
at the close of business on any record date with respect to any Interest Payment Date shall be
entitled to receive the interest payable on such Interest Payment Date. Interest shall be payable
at the office of the Company maintained by the Company for such purposes in the Borough of
Manhattan, City of New York, which shall initially be an office or agency of the Trustee. The
Company shall pay interest (i) on any Notes in certificated form by check mailed to the address of
the Person entitled thereto as it appears in the Note register (or upon written application by such
Person to the Note Registrar not later than the relevant record date, by wire transfer in
immediately available funds to such Person’s account within the United States, if such Person is
entitled to interest on an aggregate principal in excess of $1,000,000) or (ii) on any Global Note
by wire transfer of immediately available funds to the account of the Depositary or its nominee.
The term “record date” with respect to any Interest Payment Date shall mean the May 1 or November 1
preceding the applicable May 15 or November 15 Interest Payment Date, respectively.

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

     (1) The Company may elect to make payment of any Defaulted Interest to the Persons in whose
names the Notes (or their respective Predecessor Notes) 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

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Defaulted
Interest proposed to be paid on each Note and the date of the proposed payment (which shall be not
less than twenty-five (25) days after the receipt by the Trustee of such notice, unless the Trustee
shall consent to an earlier date), and at the same time the Company shall deposit with the Trustee
an amount of money equal to the aggregate amount to be paid in respect of such Defaulted Interest
or shall make arrangements satisfactory to the Trustee for such deposit on or prior to the date of
the proposed payment, such money when deposited to be held in trust for the benefit of the Persons
entitled to such Defaulted Interest as in this clause provided. Thereupon the Company shall fix a
special record date for the payment of such Defaulted Interest which shall be not more than fifteen
(15) days and not less than ten (10) days prior to the date of the proposed payment, and not less
than ten (10) days after the receipt by the Trustee of the notice of the proposed payment. The
Company shall promptly notify the Trustee in writing of such special record date and the Trustee, in the name
and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted
Interest and the special record date therefor to be mailed, first-class postage prepaid, to each
holder at his address as it appears in the Note Register, not less than ten (10) days prior to such
special record date. Notice of the proposed payment of such Defaulted Interest and the special
record date therefor having been so mailed, such Defaulted Interest shall be paid to the Persons in
whose names the Notes (or their respective Predecessor Notes) are registered at the close of
business on such special record date and shall no longer be payable pursuant to the following
clause (2) of this Section 2.03.

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

          Section 2.04.  
Date and Denomination of Notes. The Notes shall be issuable in fully registered
form without coupons in denominations of $1,000 principal amount and integral multiples thereof.
Every Note shall be dated the date of its authentication.

          Section 2.05.   Execution, Authentication and Delivery of Notes. The Notes shall be signed in
the name and on behalf of the Company by the manual or facsimile signature of its Chairman or
Vice-Chairman of the Board of Directors, Chief Executive Officer, President, any of its Executive
or Senior Vice Presidents, Managing Director, or any of its Vice Presidents (whether or not
designated by a number or numbers or word or words added before or after the title “Vice
President”).

     At any time and from time to time after the execution and delivery of this Indenture, the
Company may deliver Notes executed by the Company to the Trustee for authentication, together with
a Company Order for the authentication and delivery of such Notes, and the Trustee in accordance
with such Company Order shall authenticate and deliver such Notes, without any further action by
the Company hereunder.

     Only such Notes as shall bear thereon a certificate of authentication substantially in the
form set forth on the form of Note attached as Exhibit A hereto, manually executed by the Trustee
(or an authenticating agent appointed by the Trustee as provided by Section 15.11), shall

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be
entitled to the benefits of this Indenture or be valid or obligatory for any purpose. Such
certificate by the Trustee (or such an authenticating agent) upon any Note executed by the Company
shall be conclusive evidence that the Note so authenticated has been duly authenticated and
delivered hereunder and that the holder is entitled to the benefits of this indenture.

     In case any officer of the Company who shall have signed any of the Notes shall cease to be
such officer before the Notes so signed shall have been authenticated and delivered by the Trustee,
or disposed of by the Company, such Notes nevertheless may be authenticated and delivered or
disposed of as though the person who signed such Notes had not ceased to be such officer of the
Company: and any Note may be signed on behalf of the Company by such persons as, at the actual date
of the execution of such Note, shall be the proper officers of the Company, although at the date of
the execution of this Indenture any such person was not such an officer.

     The
Trustee shall have the right to decline to authenticate and deliver
any Notes under this Section if the Trustee, being advised by counsel
of national reputation, determines that such action may not lawfully
be taken or if the Trustee in good faith shall determine that such
action would expose the Trustee to personal liability to existing
Noteholders.

     Section 2.06.   Exchange and Registration of Transfer of Notes; Restrictions on Transfer;
Depositary.

     (a) The Company shall cause to be kept at the Corporate Trust Office a register (the register
maintained in such office and in any other office or agency of the Company designated pursuant to
Section 3.02 being herein sometimes collectively referred to as the “Note register”) in which,
subject to such reasonable regulations as it may prescribe, the Company shall provide for the
registration of Notes and of transfers of Notes. Such register shall be in written form or in any
form capable of being converted into written form within a reasonable period of time. The Trustee
is hereby appointed “Note Registrar” for the purpose of registering Notes and transfers of Notes as
herein provided. The Company may appoint one or more co-registrars in accordance with Section
3.02.

     Upon surrender for registration of transfer of any Note to the Note Registrar or any
co-registrar, and satisfaction of the requirements for such transfer set forth in this Section
2.06, the Company shall execute, and the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Notes of any authorized denominations and of
a like aggregate principal amount and bearing such restrictive legends as may be required by this
Indenture.

     Notes may be exchanged for other Notes of any authorized denominations and of a like aggregate
principal amount, upon surrender of the Notes to be exchanged at any such office or agency
maintained by the Company pursuant to Section 3.02. Whenever any Notes are so surrendered for
exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Notes which the Noteholder making the exchange is entitled to receive, bearing
registration numbers not contemporaneously outstanding.

     All Notes presented or surrendered for registration of transfer or for exchange, repurchase or
conversion shall (if so required by the Company, the Trustee, the Note Registrar or any
co-registrar) be duly endorsed, or be accompanied by a written instrument or instruments of
transfer in form satisfactory to the Company and duly executed, by the Noteholder thereof or his
attorney-in-fact duly authorized in writing.

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     No service charge shall be charged to the Noteholder for any exchange or registration of
transfer of Notes, but the Company or the Trustee may require payment of a sum sufficient to cover
any tax, assessments or other governmental charges that may be imposed in connection therewith.

     None of the Company, the Trustee, the Note Registrar or any co-registrar shall be required to
exchange or register a transfer of (a) any Notes surrendered for conversion or, if a portion of any
Note is surrendered for conversion, such portion thereof surrendered for conversion or (b) any
Notes, or a portion of any Note, surrendered for repurchase (and not
withdrawn) except in accordance with
Article XIII for conversion and Article XIV for repurchase
hereof respectively.

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

     (b) So long as the Notes are eligible for book-entry settlement with the Depositary, unless
otherwise required by law, all Notes shall be represented by one or more Notes in global form
(each, a “Global Note”) registered in the name of the Depositary or the nominee of the Depositary.
The transfer and exchange of beneficial interests in a Global Note, which does not involve the
issuance of a definitive Note, shall be effected through the Depositary (but not the Trustee or the
Custodian) in accordance with this Indenture (including the restrictions on transfer set forth
herein) and the procedures of the Depositary therefor.

     (c) Any Global Note may be endorsed with or have incorporated in the text thereof such legends
or recitals or changes not inconsistent with the provisions of this Indenture as may be required by
the Custodian, the Depositary or by the National Association of Securities Dealers, Inc. to comply
with any applicable law or any regulation thereunder or with the rules and regulations of any
securities exchange or automated quotation system upon which the Notes may be listed or traded or
designated for issuance or to conform with any usage with respect thereto, or to indicate any
special limitations or restrictions to which any particular Notes are subject.

     Notwithstanding any other provisions of this Indenture, a Global Note may not be transferred
as a whole or in part except 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.

     The Depositary shall be a clearing agency registered under the Exchange Act. The Company
initially appoints The Depository Trust Company to act as Depositary with respect to the Global
Note. Initially, the Global Note shall be issued to the Depositary, registered in the name of Cede
& Co., as the nominee of the Depositary, and deposited with the Trustee as custodian for Cede & Co.

     If at any time the Depositary for a Global Note (i) notifies the Company that it is unwilling
or unable to continue as Depositary for such Note or (ii) ceases to be registered as a

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clearing
agency under the Exchange Act, the Company may appoint a successor Depositary with respect to such
Note. If (1) a successor Depositary for such Global Note is not appointed by the Company within
ninety (90) days after the Company receives such notice or the Depositary ceasing to be a
registered clearing agency, (2) the Company, at its option, notifies the Trustee that it elects to
cause the issuance of Notes in definitive form in exchange for all or any part of the Notes
represented by a Global Note, subject to the procedures of the Depositary, or (3) an Event of
Default has occurred and is continuing and the Note Registrar has received a request from the
Depositary for the issuance of Notes in definitive form in exchange for a Global Note, the Company
will execute, and the Trustee, upon receipt of an Officers’ Certificate for the authentication and
delivery of Notes, will authenticate and deliver Notes in definitive form in an aggregate principal
amount equal to the principal amount of such Global Note, in exchange for such Global Note, and
upon delivery of the Global Note to the Trustee such Global Note shall be canceled.

     Definitive Notes issued in exchange for all or a part of the Global Note pursuant to this
Section 2.06(d) shall be registered in such names and in such authorized denominations as the
Depositary, pursuant to instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee. Upon execution and authentication, the Trustee shall deliver such definitive
Notes to the persons in whose names such definitive Notes are so registered.

     At such time as all interests in a Global Note have been converted, canceled, repurchased or
transferred, such Global Note shall be, upon receipt thereof, canceled by the Trustee in accordance
with standing procedures and instructions existing between the Depositary and the Custodian. At
any time prior to such cancellation, if any interest in a Global Note is exchanged for definitive
Notes, converted, canceled, repurchased or transferred to a transferee who receives definitive
Notes therefor or any definitive Note is exchanged or transferred for part of such Global Note, the
principal amount of such Global Note shall, in accordance with the standing procedures and
instructions existing between the Depositary and the Custodian, be appropriately reduced or
increased, as the case may be, and an endorsement shall be made on such Global Note, by the Trustee
or the Custodian, at the direction of the Trustee, to reflect such reduction or increase.

          Section 2.07.   Mutilated, Destroyed, Lost or Stolen Notes. In case any Note shall become
mutilated or be destroyed, lost or stolen, the Company in its discretion may execute, and upon its
written request the Trustee or an authenticating agent appointed by the Trustee shall authenticate
and deliver, a new Note, bearing a number not contemporaneously outstanding, in exchange and
substitution for the mutilated Note, or in lieu of and in substitution for the Note so destroyed,
lost or stolen. In every case the applicant for a substituted Note shall furnish to the Company, to the Trustee and, if applicable, to such
authenticating agent such security or indemnity as may be required by them to save each of them
harmless from any loss, liability, cost or expense caused by or connected with such substitution,
and, in every case of destruction, loss or theft, the applicant shall also furnish to the Company,
to the Trustee and, if applicable, to such authenticating agent evidence to their satisfaction of
the destruction, loss or theft of such Note and of the ownership thereof.

     The Trustee or such authenticating agent may authenticate any such substituted Note and
deliver the same upon the receipt of such security or indemnity as the Trustee, the Company and,

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if
applicable, such authenticating agent may require. Upon the issuance of any substituted Note, the
Company or the Trustee may require the payment by the holder of a sum sufficient to cover any tax,
assessment or other governmental charge that may be imposed in relation thereto and any other
expenses connected therewith. In case any Note which has matured or is about to mature or has been
tendered for repurchase upon a Designated Event or is about to be converted into Common Stock shall
become mutilated or be destroyed, lost or stolen, the Company may, in its sole discretion, instead
of issuing a substitute Note, pay or authorize the payment of or convert or authorize the
conversion of the same (without surrender thereof except in the case of a mutilated Note), as the
case may be, if the applicant for such payment or conversion shall furnish to the Company, to the
Trustee and, if applicable, to such authenticating agent such security or indemnity as may be
required by them to save each of them harmless for any loss, liability, cost or expense caused by
or connected with such substitution, and, in every case of destruction, loss or theft, evidence
satisfactory to the Company, the Trustee and, if applicable, any Paying Agent or Conversion Agent
evidence of their satisfaction of the destruction, loss or theft of such Note and of the ownership
thereof.

     Every substitute Note issued pursuant to the provisions of this Section 2.07 by virtue of the
fact that any Note is destroyed, lost or stolen shall constitute an additional contractual
obligation of the Company, whether or not the destroyed, lost or stolen Note shall be found at any
time, and shall be entitled to all the benefits of (but shall be subject to all the limitations set
forth in) this Indenture equally and proportionately with any and all other Notes duly issued
hereunder. To the extent permitted by law, all Notes shall be held and owned upon the express
condition that the foregoing provisions are exclusive with respect to the replacement or payment or
conversion or repurchase of mutilated, destroyed, lost or stolen Notes and shall preclude any and
all other rights or remedies notwithstanding any law or statute existing or hereafter enacted to
the contrary with respect to the replacement or payment or conversion of negotiable instruments or
other securities without their surrender.

          Section 2.08.   Temporary Notes. Pending the preparation of Notes in certificated form, the
Company may execute and the Trustee or an authenticating agent appointed by the Trustee shall, upon
written request of the Company, authenticate and deliver temporary Notes (printed or lithographed).
Temporary Notes shall be issuable in any authorized denomination, and substantially in the form of
the Notes in certificated form but with such omissions, insertions and variations as may be
appropriate for temporary Notes, all as may be determined by the Company. Every such temporary
Note shall be executed by the Company and authenticated by the Trustee or such authenticating agent
upon the same conditions and in substantially the same manner, and with the same effect, as the
Notes in certificated form. Without unreasonable delay the Company will execute and deliver to the
Trustee or such authenticating agent Notes in certificated form (other than in the case of Notes in
global form) and thereupon any or all temporary Notes (other than any Global Note) may be
surrendered in exchange therefor, at each office or agency maintained by the Company pursuant to
Section 3.02 and the Trustee or such authenticating agent shall authenticate and deliver in
exchange for such temporary Notes an equal aggregate principal amount of Notes in certificated
form. Such exchange shall be made by the Company at its own expense and without any charge
therefor. Until so exchanged, the temporary Notes shall in all respects be entitled to the same
benefits and subject to the same limitations under this Indenture as Notes in certificated form
authenticated and delivered hereunder.

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     Section 2.09.   Cancellation of Notes Paid, Etc. All Notes surrendered for the purpose of
payment, repurchase, conversion, exchange or registration of transfer, shall, if surrendered to the
Company or any Paying Agent or any Note Registrar or any Conversion Agent, be surrendered to the
Trustee and promptly canceled by it, or, if surrendered to the Trustee, shall be promptly canceled
by it, and no Notes shall be issued in lieu thereof except as expressly permitted by any of the
provisions of this Indenture. The Trustee shall destroy canceled Notes in accordance with its
customary procedures and, after such destruction, shall deliver a certificate of such destruction
to the Company, at the Company’s written request. If the Company shall acquire any of the Notes,
such acquisition shall not operate as satisfaction of the Indebtedness represented by such Notes
unless and until the same are delivered to the Trustee for cancellation.

     Section 2.10.   CUSIP Numbers. The Company in issuing the Notes may use “CUSIP” numbers (if
then generally in use), and, if so, the trustee shall use “CUSIP” numbers in Company Notices as a
convenience to holders of the Notes; provided, that any such notice may state that no
representation is made as to the correctness of such numbers either as printed on the Notes or
Company Notice and that reliance may be placed only on the other identification numbers printed on
the Notes. The Company will promptly notify the Trustee in writing of any change in the “CUSIP”
numbers.

     Section 2.11.   Additional Notes, Repurchases. The Company may, without the consent of the
Noteholders and notwithstanding Section 2.01, reopen the Notes and issue additional Notes hereunder
with the same terms and with the same CUSIP number as the Notes initially issued hereunder in an
unlimited aggregate principal amount, which will form the same series with the Notes initially
issued hereunder so long as such additional Notes are fungible with the Notes initially issued
hereunder for U.S. federal income tax purposes. The Company may also from time to time repurchase
the Notes in tender offers, open market purchases or negotiated transactions without prior notice
to Noteholders.

ARTICLE III

PARTICULAR COVENANTS OF THE COMPANY

     Section 3.01.   Payment of Principal and Interest. The Company covenants and agrees that it
will cause to be paid the principal of, and accrued and unpaid interest on, each of the Notes and
if applicable, payment of the Conversion Obligation and Additional Shares, at the places, at the
respective times and in the manner provided herein and in the Notes. Each installment of accrued
and unpaid interest on the Notes due on any Interest Payment Date may be paid by mailing checks for
the amount payable to or upon the written order of the Noteholders entitled thereto as they shall
appear on the registry books of the Company, provided that, with respect to any Noteholder with an
aggregate principal amount in excess of $1,000,000, at the application of such holder in writing to
the Note Registrar not later than the relevant record date, accrued and unpaid interest on such
holder’s Notes shall be paid by wire transfer in immediately available funds to such holder’s
account in the United States supplied by such holder from time to time to the Trustee and Paying
Agent (if different from Trustee); provided further that payment of accrued and unpaid interest
made to the Depositary shall be paid by wire transfer in immediately available funds in accordance
with such wire transfer instructions and other procedures provided by the Depositary from time to
time.

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          Section 3.02.   Maintenance of Office or Agency. The Company will maintain in the Borough of
Manhattan, The City of New York, an office or agency where the Notes may be surrendered for
registration of transfer or exchange or for presentation for payment, redemptions or repurchase
(“Paying Agent”) or for conversion (“Conversion Agent”) and where notices and demands to or upon
the Company in respect of the Notes and this Indenture may be served. The Company will give prompt
written notice to the Trustee of the location, and any change in the location, of such office or
agency not designated or appointed by the Trustee. If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the Trustee with the address
thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate
Trust Office or the office or agency of the Trustee in the Borough of Manhattan, The City of New
York.

     The Company may also from time to time designate one or more other offices or agencies where
the Notes may be presented or surrendered for any or all such purposes and may from time to time
rescind such designations; provided that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the Borough of Manhattan,
The City of New York, for such purposes. The Company will give prompt written notice to the
Trustee of any such designation or rescission and of any change in the location of any such other
office or agency. The terms Paying Agent and Conversion Agent include any such additional or other
offices or agencies, as applicable.

     The Company hereby initially designates the Trustee as the Paying Agent, Note Registrar,
Custodian and Conversion Agent and the Corporate Trust Office and the office or agency of the
Trustee in the Borough of Manhattan shall be considered as one such office or agency of the Company
for each of the aforesaid purposes.

     So long as the Trustee is the Note Registrar, the Trustee agrees to mail, or cause to be
mailed, the notices set forth in Section 6.10(a) and the third paragraph of Section 6.11.

          Section 3.03.   Appointments to Fill Vacancies in Trustee’s Office. The Company, whenever
necessary to avoid or fill a vacancy in the office of Trustee, will appoint, in the manner provided
in Section 6.10, a Trustee, so that there shall at all times be a Trustee hereunder.

          Section 3.04.   Provisions as to Paying Agent.

     (a) If the Company shall appoint a Paying Agent other than the Trustee or if the Trustee shall
appoint such a Paying Agent, the Company will cause such Paying Agent to execute and deliver to the
Trustee an instrument in which such agent shall agree with the Trustee, subject to the provisions
of this Section 3.04.

     (i) that it will hold all sums held by it as such agent for the payment of the
principal of, and accrued and unpaid interest on, the Notes (whether such sums have been
paid to it by the Company or by any other obligor on the Notes) in trust for the benefit of
the holders of the Notes;

     (ii) that it will give the Trustee notice of any failure by the Company (or by any
other obligor on the Notes) to make any payment of the principal of, and accrued and unpaid
interest on, the Notes when the same shall be due and payable; and

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     (iii) that at any time during the continuance of an Event of Default, upon request of
the Trustee, it will forthwith pay to the Trustee all sums so held in trust.

     The Company shall, on or before each due date of the principal of, or accrued and unpaid
interest on the Notes, deposit with the Paying Agent a sum sufficient to pay such principal or
accrued and unpaid interest and (unless such Paying Agent is the Trustee) the Company will promptly
notify the Trustee in writing of any failure to take such action, provided that if such deposit is made on the
due date, such deposit must be received by the Paying Agent by 11:00 a. m., New York City time, on
such date.

     (b) If the Company shall act as its own Paying Agent, it will, on or before each due date of
the principal of and accrued and unpaid interest on the Notes, set aside, segregate and hold in
trust for the benefit of the holders of the Notes a sum sufficient to pay such principal and
accrued and unpaid interest so becoming due and will notify the Trustee in writing of any failure
to take such action and of any failure by the Company (or any other obligor under the Notes) to
make any payment of the principal of and accrued and unpaid interest on the Notes, when the same
shall become due and payable.

     (c) Anything in this Section 3.04 to the contrary notwithstanding, the Company may, at any
time, for the purpose of obtaining a satisfaction and discharge of this Indenture, or for any other
reason, pay or cause to be paid to the Trustee all sums held in trust by the Company or any Paying
Agent hereunder as required by this Section 3.04, such sums to be held by the Trustee upon the
trusts herein contained and upon such payment by the Company or any Paying Agent to the Trustee, the Company or such Paying Agent shall be released from all further liability
with respect to such sums.

     (d) Anything in this Section 3.04 to the contrary notwithstanding, the agreement to hold sums
in trust as provided in this Section 3.04 is subject to Section 11.03 and Section 11.04.

          Section 3.05.   Existence. Subject to Article XII, 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 3.06.   Stay, Extension and Usury Laws. The Company covenants (to the extent that it
may lawfully do so) that it 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 from paying all or any portion of the principal of, or
interest on, the Notes 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 (to
the extent it may lawfully do so) hereby expressly waives all benefit or advantage of any such law,
and covenants that it 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 3.07.   Compliance Certificate; Statements as to Defaults. The Company shall deliver
to the Trustee within 120 calendar days after the end of each fiscal year of the Company (beginning
with the fiscal year ending on December 31, 2006) an Officers’ Certificate stating whether or not
the signer thereof has knowledge of any failure by the Company to comply with

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all conditions and
covenants then required to be performed under this Indenture and, if so, specifying each such
failure and the nature thereof.

     In addition, the Company shall deliver to the Trustee, as soon as possible and in any event
within 30 days after the Company becomes aware of the occurrence of any Event of Default or
Default, an Officers’ Certificate setting forth the details of such Event of Default or Default,
its status and the action which the Company proposes to take with respect thereto.

          Section 3.08.   Further Instruments and Acts. Upon request of the Trustee, the Company 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.

ARTICLE IV

LISTS OF NOTEHOLDERS AND REPORTS BY THE COMPANY AND THE TRUSTEE

          Section 4.01.   Lists of Noteholders. The Company covenants and agrees that it will furnish or cause to be furnished to the
Trustee, semi-annually, not more than fifteen (15) days after each May 1 and November 1 in each
year beginning with November 1, 2006, and at such other times as the Trustee may request in
writing, within thirty (30) days after receipt by the Company of any such request (or such lesser
time as the Trustee may reasonably request in order to enable it to timely provide any notice to be
provided by it hereunder), a list in such form as the Trustee may reasonably require of the names
and addresses of the Noteholders as of a date not more than fifteen (15) days (or such other date
as the Trustee may reasonably request in order to so provide any such notices) prior to the time
such information is furnished, except that no such list need be furnished so long as the Trustee is
acting as Note Registrar.

          Section 4.02.   Preservation and Disclosure of Lists.

     (a) The Trustee shall preserve, in as current a form as is reasonably practicable, all
information as to the names and addresses of the Noteholders contained in the most recent list
furnished to it as provided in Section 4.01 or maintained by the Trustee in its capacity as Note
Registrar, if so acting. The Trustee may destroy any list furnished to it as provided in Section
4.01 upon receipt of a new list so furnished.

     (b) The rights of Noteholders to communicate with other Noteholders with respect to their
rights under this Indenture or under the Notes and the corresponding rights and duties of the
Trustee, shall be as provided by the Trust Indenture Act.

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

          Section 4.03.   Reports by Trustee.

     (a) Within sixty (60) days after May 15 of each year commencing with the year 2006, the
Trustee shall transmit to Noteholders such reports dated as of May 15 of each year in which

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such
reports are made concerning the Trustee and its actions under this Indenture as may be required
pursuant to the Trust Indenture Act at the times and in the manner provided pursuant thereto.

     (b) A copy of such report shall, at the time of such transmission to Noteholders, be filed by
the Trustee with each stock exchange and automated quotation system upon which the Notes are listed
and with the Company. The Company will notify the Trustee in writing within a reasonable time when
the Notes are listed on any stock exchange or automated quotation system and when any such listing
is discontinued.

          Section 4.04.   Reports by Company.

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

     (b) Delivery of such reports, information 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
Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to
conclusively rely exclusively on an Officers’ Certificate).

ARTICLE V

DEFAULTS AND REMEDIES

          Section 5.01.   Events of Default. The following events shall be Events of Default with
respect to the Notes:

     (a) default in any payment of interest, on any Note when due and payable and the default
continues for a period of 30 days;

     (b) default in the payment of principal of any Note when due and payable on the Maturity Date,
upon required repurchase, upon declaration or otherwise;

     (c) failure by the Company to comply with its obligation to convert the Notes into cash or a
combination of cash and Common Stock, as applicable, upon exercise of a holder’s conversion right;

     (d) failure by the Company to comply with its obligations under Article X;

     (e) failure by the Company to issue a Designated Event Company Notice in accordance with
Section 14.02 when due;

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     (f) failure by the Company for 60 days to comply with any of its other agreements (other than
a covenant or warranty or default in whose performance or whose breach is elsewhere in this Section
specifically provided for) contained in the Notes or the Indenture after written notice of such
default from the Trustee or the holders of at least 25% in principal amount of the Notes then
outstanding has been received by the Company;

     (g) default by the Company or any Subsidiary of the Company in the payment of the principal or
interest on any mortgage, agreement or other instrument under which there may be outstanding, or by
which there may be secured or evidenced, any debt for money borrowed in excess of $50 million in
the aggregate of the Company and/or any such Subsidiary, whether such debt now exists or shall
hereafter be created, which default results in such debt becoming or being declared due and
payable, and such acceleration shall not have been rescinded or annulled within 30 days after
written notice of such acceleration has been received by the Company or such Subsidiary;

     (h) the Company shall commence a voluntary case or other proceeding seeking liquidation,
reorganization or other relief with respect to the Company or any of its Significant Subsidiaries
or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of
the Company or any of its Significant Subsidiaries or any substantial part of its property, or
shall consent to any such relief or to the appointment of or taking possession by any such official
in an involuntary case or other proceeding commenced against it, or shall make a general assignment
for the benefit of creditors, or shall fail generally to pay its debts as they become due; or

     (i) an involuntary case or other proceeding shall be commenced against the Company or any of
its Significant Subsidiaries seeking liquidation, reorganization or other relief with respect to
the Company or its debts under any bankruptcy, insolvency or other similar law now or hereafter in
effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar
official of the Company or any of its Significant Subsidiaries or any substantial part of its
property, and such involuntary case or other proceeding shall remain undismissed and unstayed for a
period of ninety (90) consecutive days.

     In case one or more Events of Default shall have occurred and be continuing (whatever the
reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body), then, and in each and every such case
(other than an Event of Default specified in Section 5.01(h) or Section 5.01(i) with respect to the
Company), unless the principal of all of the Notes shall have already become due and payable,
either the Trustee or the holders of at least 25% in aggregate principal amount of the Notes then
outstanding determined in accordance with Section 7.04, by notice in writing to the Company (and to
the Trustee if given by Noteholders), may declare 100% of the principal of, and accrued and unpaid
interest on, all the Notes to be due and payable immediately, and upon any such declaration the
same shall become and shall be immediately due and payable, anything in this Indenture or in the
Notes contained to the contrary notwithstanding. If an Event of Default specified in Section
5.01(h) or Section 5.01(i) occurs and is continuing with respect to the Company, the principal of
all the Notes and accrued and unpaid interest shall be immediately

22

 

due and payable. This
provision, however, is subject to the conditions that if, at any time after the principal of the
Notes shall have been so declared due and payable, and before any judgment or decree for the
payment of the monies due shall have been obtained or entered as hereinafter provided, the Company
shall pay or shall deposit with the Trustee a sum sufficient to pay installments of accrued and
unpaid interest upon all Notes and the principal of any and all Notes that shall have become due
otherwise than by acceleration (with interest on overdue installments of accrued and unpaid
interest (to the extent that payment of such interest is enforceable under applicable law) and on
such principal at the rate borne by the Notes during the period of such Default) and amounts due to
the Trustee pursuant to Section 6.06, and if (1) rescission would not conflict with any judgment or
decree of a court of competent jurisdiction and (2) any and all Events of Defaults under this
Indenture, other than the nonpayment of principal of and accrued and unpaid interest on Notes that
shall have become due solely by such acceleration, shall have been cured or waived pursuant to
Section 5.07, then and in every such case the holders of a majority in aggregate principal amount
of the Notes then outstanding, by written notice to the Company and to the Trustee, may waive all
defaults or Events of Default with respect to the Notes and rescind and annul such declaration and its consequences and such default shall cease
to exist, and any Event of Default arising therefrom shall be deemed to have been cured for every
purpose of this Indenture; but no such waiver or rescission and annulment shall extend to or shall
affect any subsequent default or Event of Default, or shall impair any right consequent thereon.
The Company shall notify the Responsible Officer of the Trustee in
writing, promptly upon becoming aware
thereof, of any Event of Default by delivering to the Trustee a statement specifying such Event of
Default and any action the Company has taken, is taking or proposes to take with respect thereto.

     In case the Trustee shall have proceeded to enforce any right under this Indenture and such
proceedings shall have been discontinued or abandoned because of such waiver or rescission and
annulment or for any other reason or shall have been determined adversely to the Trustee, then and
in every such case the Company, the Noteholders, and the Trustee shall, subject to any
determination in such proceeding, be restored respectively to their several positions and rights
hereunder, and all rights, remedies and powers of the Company, the Noteholders, and the Trustee
shall continue as though no such proceeding had been instituted.

          Section 5.02.   Payments of Notes on Default; Suit Therefor. In the event that the Trustee or
the holders of not less than 25% in aggregate principal amount of the Notes then outstanding
hereunder have declared the principal of and accrued and unpaid interest on, the Notes, to be due
and payable immediately in accordance with Section 5.01, and the Company shall have failed
forthwith to pay such amounts, the Trustee, in its own name and as trustee of an express trust,
after being furnished suitable indemnity pursuant to Section 6.01, shall be entitled and empowered
to institute any actions or proceedings at law or in equity for the collection of the sums so due
and unpaid (including such further amounts as shall be sufficient to cover the reasonable costs and
expenses of collection, including reasonable compensation to the Trustee, its agents, attorneys and
counsel, and any expenses or liabilities incurred by the Trustee hereunder other than through its
negligence or bad faith), and may prosecute any such action or proceeding to judgment or final
degree, and may enforce any such judgment or final decree against the Company or any other obligor
on the Notes and collect in the manner provided by law out of the property of the Company or any
other obligor on the Notes wherever situated the monies adjudged or decreed to be payable.

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     In case there shall be pending proceedings for the bankruptcy or for the reorganization of the
Company or any other obligor on the Notes under title 11 of the United States Code, or any other
applicable law, or in case a receiver, assignee or trustee in bankruptcy or reorganization,
liquidator, sequestrator or similar official shall have been appointed for or taken possession of
the Company or such other obligor, the property of the Company or such other obligor, or in the
case of any other judicial proceedings relative to the Company or such other obligor upon the
Notes, or to the creditors or property of the Company or such other obligor, the Trustee,
irrespective of whether the principal of the Notes 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 pursuant to the provisions of this Section 6.02, shall be entitled and empowered, by
intervention in such proceedings or otherwise, to file and prove a claim or claims for the whole
amount of principal and accrued and unpaid interest in respect of the Notes, and, in case of any
judicial proceedings, to file such proofs of claim and other papers or documents and to take such other actions as it may deem 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 Noteholders allowed in such judicial proceedings
relative to the Company or any other obligor on the Notes, its or their creditors, or its or their
property, and to collect and receive any monies or other property payable or deliverable on any
such claims, and to distribute the same after the deduction of any amounts due the Trustee under
Section 6.06; and any receiver, assignee or trustee in bankruptcy or reorganization, liquidator,
custodian or similar official is hereby authorized by each of the Noteholders to make such payments
to the Trustee, as administrative expenses, and, in the event that the Trustee shall consent to the
making of such payments directly to the Noteholders, to pay to the Trustee any amount due it for
reasonable compensation, expenses, advances and disbursements, including agents and counsel fees,
and including any other amounts due to the Trustee under Section 6.06 hereof, incurred by it up to
the date of such distribution. To the extent that such payment of reasonable compensation,
expenses, advances and disbursements out of the estate in any such proceedings shall be denied for
any reason, payment of the same shall be secured by a lien on, and shall be paid out of, any and
all distributions, dividends, monies, securities and other property which the holders of the Notes
may be entitled to receive in such proceedings, whether in liquidation or under any plan of
reorganization or arrangement or otherwise.

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

     All rights of action and of asserting claims under this Indenture, or under any of the Notes,
may be enforced by the Trustee without the possession of any of the Notes, or the production
thereof at any trial or other proceeding relative thereto, and any such suit or proceeding
instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall, after provision for the payment of the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, be for the ratable
benefit of the holders of the Notes.

     In any proceedings brought by the Trustee (and in any proceedings involving the interpretation
of any provision of this Indenture to which the Trustee shall be a party) the Trustee

24

 

shall be held
to represent all the holders of the Notes, and it shall not be necessary to make any holders of the
Notes parties to any such proceedings.

          Section 5.03.   Application of Monies Collected by Trustee. Any monies collected by the
Trustee pursuant to this Article V with respect to the Notes shall be applied in the order
following, at the date or dates fixed by the Trustee for the distribution of such monies, upon
presentation of the several Notes, and stamping thereon the payment, if only partially paid, and
upon surrender thereof, if fully paid:

     First, to the payment of all amounts due the Trustee under Section 6.06;

     Second, in case the principal of the outstanding Notes shall not have become due and be
unpaid, to the payment of interest on the Notes in default in the order of the maturity of the
installments of such interest, with interest (to the extent that such interest has been collected
by the Trustee) upon the overdue installments of interest at the rate borne by the Notes, such
payments to be made ratably to the Persons entitled thereto;

     Third, in case the principal of the outstanding Notes shall have become due, by declaration or
otherwise, and be unpaid to the payment of the whole amount (including, if applicable, payments in
respect of the Conversion Obligation and Additional Shares) then owing and unpaid upon the Notes
for principal and interest, with interest on the overdue principal (to the extent that such
interest has been collected by the Trustee) upon overdue installments of interest at the rate borne
by the Notes, and in case such monies shall be insufficient to pay in full the whole amounts so due
and unpaid upon the Notes, then to the payment of such principal and interest without preference or
priority of principal over interest, or of interest over principal or of any installment of
interest over any other installment of interest, or of any Note over any other Note, ratably to the
aggregate of such principal and accrued and unpaid interest; and

     Fourth, to the payment of the remainder, if any, to the Company or any other Person lawfully
entitled thereto.

          Section 5.04.   Proceedings by Noteholders. No holder of any Note shall have any right by
virtue of or by availing of any provision of this Indenture to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this Indenture, or for the
appointment of a receiver, trustee, liquidator, custodian or other similar official, or for any
other remedy hereunder, unless such holder previously shall have given to the Trustee written
notice of an Event of Default and of the continuance thereof, as hereinbefore provided, and unless
also the holders of not less than 25% in aggregate principal amount of the Notes then outstanding
shall have made written request upon the Trustee to institute such action, suit or proceeding in
its own name as Trustee hereunder and shall have offered to the Trustee such security or indemnity
reasonably satisfactory to it against any loss, liability or expense to be incurred therein or
thereby, and the Trustee for sixty (60) days after its receipt of such notice, request and offer of
indemnity, shall have neglected or refused to institute any such action, suit or proceeding and no
direction that, in the opinion of the Trustee, is inconsistent with such written request shall have
been given to the Trustee by the holders of a majority in principal amount of the Notes outstanding
pursuant to Section 5.07; it being understood and intended, and being expressly covenanted by the
taker and holder of every Note with every other taker and holder and the

25

 

Trustee, that no one or
more Noteholders shall have any right in any manner whatever by virtue of or by availing of any
provision of this Indenture to affect, disturb or prejudice the rights of any other Noteholder, or
to obtain or seek to obtain priority over or preference to any other such holder, or to enforce any
right under this Indenture, except in the manner herein provided and for the equal, ratable and
common benefit of all Noteholders (except as otherwise provided herein). For the protection and
enforcement of this Section 5.04, each and every Noteholder and the Trustee shall be entitled to
such relief as can be given either at law or in equity.

     Notwithstanding any other provision of this Indenture and any provision of any Note, the right
of any Noteholder to receive payment of the principal of and accrued and unpaid interest on such
Note, on or after the respective due dates expressed in such Note, or to institute suit for the
enforcement of any such payment on or after such respective dates against the Company shall not be
impaired or affected without the consent of such Noteholder.

     Anything in this Indenture or the Notes to the contrary notwithstanding, the holder of any
Note, without the consent of either the Trustee or the holder of any other Note, in his own behalf
and for his own benefit, may enforce, and may institute and maintain any proceeding suitable to
enforce, his rights of conversion as provided herein.

          Section 5.05.   Proceedings by Trustee. In case of an Event of Default the Trustee may in its
discretion proceed to protect and enforce the rights vested in it by this Indenture by such
appropriate judicial proceedings as are necessary to protect and enforce any of such rights, either
by suit in equity or by action at law or by proceeding in bankruptcy or otherwise, whether for the
specific enforcement of any covenant or agreement contained in this Indenture or in aid of the
exercise of any power granted in this Indenture, or to enforce any other legal or equitable right
vested in the Trustee by this Indenture or by taw.

          Section 5.06.   Remedies Cumulative and Continuing. Except as provided in the last paragraph
of Section 2.07, all powers and remedies given by this Article V to the Trustee or to the
Noteholders shall, to the extent permitted by law, be deemed cumulative and not exclusive of any
thereof or of any other powers and remedies available to the Trustee or the holders of the Notes,
by judicial proceedings or otherwise, to enforce the performance or observance of the covenants and
agreements contained in this Indenture, and no delay or omission of the Trustee or of any holder of
any of the Notes to exercise any right or power accruing upon any default or Event of Default shall
impair any such right or power, or shall be construed to be a waiver of any such default or any
acquiescence therein; and, subject to the provisions of Section 5.04, every power and remedy given
by this Article V or by law to the Trustee or to the Noteholders may be exercised from time to
time, and as often as shall be deemed expedient by the Trustee or by the Noteholders.

          Section 5.07.   Direction of Proceedings and Waiver of Defaults by Majority of Noteholders.
The holders of a majority in aggregate principal amount of the Notes at the time outstanding
determined in accordance with Section 7.04 shall have the right to direct the time, method, and
place of conducting any proceeding for any remedy available to the Trustee or exercising any trust
or power conferred on the Trustee with respect to Notes; provided, however, that (a) such direction
shall not be in conflict with any rule of law or with this Indenture, and (b) the Trustee may take
any other action deemed proper by the Trustee that is not inconsistent with

26

 

such direction. The
Trustee may refuse to follow any direction that it determines is unduly prejudicial to the rights
of any other holder or that would involve the Trustee in personal liability. The holders of a
majority in aggregate principal amount of the Notes at the time
outstanding determined in accordance with Section 7.04 may, on behalf of the holders of all of
the Notes waive any past default or Event of Default hereunder and its consequences except (i) a
default in the payment of and accrued and unpaid interest on, or the principal of, the Notes when
due which has not been cured pursuant to the provisions of Section 5.01, (ii) a failure by the
Company to deliver cash and, if applicable, shares of Common Stock (and cash in lieu of fractional
shares) upon conversion of the Notes, or (iii) a default in respect of a covenant or provisions
hereof which under Article IX cannot be modified or amended without the consent of each holder of
an outstanding Note affected thereby. Upon any such waiver the Company, the Trustee and the
holders of the Notes shall be restored to their former positions and rights hereunder, but no such
waiver shall extend to any subsequent or other default or Event of Default or impair any right
consequent thereon. Whenever any default or Event of Default hereunder shall have been waived as
permitted by this Section 5.07, said default or Event of Default shall for all purposes of the
Notes and this Indenture be deemed to have been cured and to be not continuing; but no such waiver
shall extend to any subsequent or other default or Event of Default or impair any right consequent
thereon.

     Section 5.08.   Notice of Defaults. The Trustee shall, within ninety (90) days after the
occurrence and continuance of a Default of which a Responsible Officer has actual knowledge, mail
to all Noteholders as the names and addresses of such holders appear upon the Note register, notice
of all Defaults known to a Responsible Officer, unless such Defaults shall have been cured or
waived before the giving of such notice; and provided that, except in the case of a Default in the
payment of the principal of and accrued and unpaid interest on any of the Notes, then in any such
event the Trustee shall be protected in withholding such notice if and so long as a committee of
trust officers of the Trustee in good faith determine that the withholding of such notice is in the
interests of the Noteholders.

     Section 5.09.   Undertaking to Pay Costs. All parties to this Indenture agree, and each holder
of any Note 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 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; provided that the provisions of this Section 5.09 (to the
extent permitted by law) shall not apply to any suit instituted by the Trustee, to any suit
instituted by any Noteholder, or group of Noteholders, holding in the aggregate more than 10% in
principal amount of the Notes at the time outstanding determined in accordance with Section 7.04,
or to any suit instituted by any Noteholder for the enforcement of the payment of the principal of
and accrued and unpaid interest on any Note on or after the due date expressed in such Note or to
any suit for the enforcement of the right to convert any Note in accordance with the provisions of
Article XIII.

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ARTICLE VI

CONCERNING THE TRUSTEE

        Section 6.01.   Duties and Responsibilities of Trustee. The Trustee, prior to the occurrence
of an Event of Default and after the curing or waiver of all Events of Default which may have
occurred, undertakes to perform such duties and only such duties as are specifically set forth in
this Indenture. In case an Event of Default has occurred (which has not been cured or waived) the
Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the
same degree of care and skill in their exercise, as a prudent person would exercise or use under
the circumstances in the conduct of such person’s own affairs; provided that if an Event of Default
occurs and is continuing, the Trustee will be under no obligation to exercise any of the rights or
powers under this Indenture at the request or direction of any of the holders unless such holders
have offered to the Trustee reasonable indemnity or security against loss, liability or expense.

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

     (a) prior to the occurrence of an Event of Default and after the curing or waiving of all
Events of Default which may have occurred:

     (i) the duties and obligations of the Trustee shall be determined solely by the express
provisions of this Indenture and, after it has been qualified thereunder, the Trust
Indenture Act, and the Trustee shall not be liable except for the performance of such duties
and obligations as are specifically set forth in this Indenture and no implied covenants or
obligations shall be read into this Indenture and the Trust Indenture Act against the
Trustee; and

     (ii) in the absence of bad faith and willful misconduct on the part of the Trustee, the
Trustee may conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture; but, in the case of any such certificates
or opinions which by any provisions 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;

     (b) the Trustee shall not be liable for any error of judgment made in good faith by a
Responsible Officer or Officers of the Trustee, unless it shall be established by a court of
competent jurisdiction that the Trustee was grossly negligent in ascertaining the pertinent facts;

     (c) the Trustee shall not be liable with respect to any action taken or omitted to be taken by
it in good faith and either (i) believed by it to be authorized
or within the discretion or rights or powers conferred upon it by
this Indenture or (ii) in accordance with the direction of the holders of not less than a majority in
principal amount of the Notes at the time outstanding determined as provided in Section 7.04
relating to the time, method and place of conducting any proceeding for any remedy

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available to the Trustee, or exercising any trust or power conferred upon the Trustee, under
this Indenture;

     (d) whether or not therein provided, every provision of this Indenture relating to the conduct
or affecting the liability of, or affording protection to, the Trustee shall be subject to the
provisions of this Section;

     (e) the Trustee shall not be liable in respect of any payment (as to the correctness of
amount, entitlement to receive or any other matters relating to payment) or notice effected by the
Company or any Paying Agent or any records maintained by any co-registrar with respect to the
Notes;

     (f) if any party fails to deliver a notice relating to an event the fact of which, pursuant to
this Indenture, requires notice to be sent to the Trustee, the Trustee may conclusively rely on its
failure to receive such notice as reason to act as if no such event occurred, unless such
Responsible Officer of the Trustee had actual knowledge of such event;

     (g) in the absence of written investment direction from the Company, all cash received by the
Trustee shall be placed in a non-interest bearing trust account. In no event shall the Trustee be
liable for the selection of investments or for investment losses incurred thereon or for losses
incurred as a result of the liquidation of any such investments prior to its stated maturity or the
failure of the party directing such investments prior to its stated maturity or the failure of the
party directing such investment to provide timely written investment direction, and the Trustee
shall have no obligation to invest or reinvest any amounts held hereunder in the absence of such
written investment direction from the Company; and

     (h) in the event that the Trustee is also acting as Custodian, Note Registrar, Paying
Agent, Conversion Agent or transfer agent hereunder, the rights and protections afforded to the
Trustee pursuant to this Article VI shall also be afforded to it in its capacity as such.

     None of the provisions contained in this Indenture shall require the Trustee to expend or risk
its own funds or otherwise incur personal financial liability in the performance of any of its
duties or in the exercise of any of its rights or powers.

          Section 6.02.   Reliance on Documents, Opinions, Etc. Except as otherwise provided in Section
6.01:

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

     (b) any request, direction, order or demand of the Company mentioned herein shall be
sufficiently evidenced by an Officers’ Certificate (unless other evidence in respect thereof be
herein specifically prescribed); and any resolution of the Board of Directors may be evidenced to
the Trustee by a copy thereof certified by the Secretary or an Assistant Secretary of the Company;

29

 

     (c) the Trustee may consult with counsel and require an Opinion of Counsel and any advice of
such counsel or Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken or omitted by it hereunder in good faith and in accordance with such
advice or Opinion of Counsel;

     (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, order or direction of any of the Noteholders pursuant to the
provisions of this Indenture, unless such Noteholders shall have offered to the Trustee security or
indemnity satisfactory to it against the costs, expenses and liabilities which may be incurred
therein or thereby;

     (e) the Trustee shall not be bound to make any investigation into the facts or matters stated
in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture or other paper or document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or matters as it may see fit, and, if
the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to
examine the books, records and premises of the Company, personally or by agent or attorney;
provided, however, that if the payment within a reasonable time to the Trustee of the costs,
expenses or liabilities likely to be incurred by it in the making of such investigation is, in the
opinion of the Trustee, not reasonably assured to the Trustee by the security afforded to it by the
terms of this Indenture, the Trustee may require indemnity satisfactory to the Trustee from the
Noteholders against such expenses or liability as a condition to so proceeding; the reasonable
expenses of every such examination shall be paid by the Company or, if paid by the Trustee or any
predecessor Trustee, shall be repaid by the Company upon demand;

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

     (g) the permissive rights of the Trustee enumerated herein shall not be construed as duties.

     (h) 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 Officer Certificates or Opinions of Counsel furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such Certificates or Opinions which by any
provisions 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);

     (i) the Trustee may request that the Company deliver an Officer’
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 Officers’
Certificate may be signed by any person authorized to sign Officer’ Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded.

     In no event shall the Trustee be liable for any consequential loss or damage of any kind
whatsoever (including but not limited to lost profits), even if the Trustee has been advised of the
likelihood of such loss or damage and regardless of the form of action other than through the
Trustee’s willful misconduct or gross negligence. The Trustee shall not be charged with knowledge
of any default or Event of Default with respect to the Notes, unless either (1) a Responsible
Officer shall have actual knowledge of such default or Event of Default or (2) written notice of
such default or Event of Default shall have been given to the Trustee by the Company or by any
holder of the Notes at the Corporate Trust Office of the Trustee, and such notice references the Notes and this Indenture; and the permissive rights of the Trustee enumerated herein shall not be
construed as duties.

          Section 6.03.   No Responsibility for Recitals, Etc. The recitals contained herein and in the
Notes (except in the Trustee’s certificate of authentication) shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for the correctness of the same. The Trustee makes no representations as to
the validity or sufficiency of this Indenture or of the

30

 

Notes. The Trustee shall not be
accountable for the use or application by the Company of any Notes or the proceeds of any Notes
authenticated and delivered by the Trustee in conformity with the provisions of this Indenture.
The Trustee shall not be responsible or liable for any loss suffered in connection with any
investment of funds made by it in accordance with this Indenture or at the direction of the
Company. Except for information provided by the Trustee concerning the Trustee, the Trustee shall
have no responsibility for any information in any offering memorandum, prospectus or other
disclosure material distributed with respect to the Notes.

     Section 6.04.   Trustee, Paying Agents, Conversion Agents or Registrar May Own Notes. The
Trustee, any Paying Agent, any Conversion Agent or Note Registrar, in its individual or any other
capacity, may become the owner or pledgee of Notes with the same rights it would have if it were
not Trustee, Paying Agent, Conversion Agent or Note Registrar.

     Section 6.05.   Monies to Be Held in Trust. Subject to the provisions of Section 11.04, all
monies received by the Trustee shall, until used or applied as herein provided, be held in trust
for the purposes for which they were received. Money held by the Trustee in trust hereunder need
not be segregated from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as may be agreed from
time to time by the Company and the Trustee.

     Section 6.06.   Compensation and Expenses of Trustee. The Company covenants and agrees to pay
to the Trustee from time to time, and the Trustee shall be entitled to, reasonable compensation for
all services rendered by it hereunder in any capacity (which shall not be limited by any provision
of law in regard to the compensation of a trustee of an express trust) as mutually agreed to in
writing between the Trustee and the Company, and the Company will pay or reimburse the Trustee upon
its request for all reasonable expenses, disbursements and advances reasonably incurred or made by
the Trustee in accordance with any of the provisions of this Indenture (including the reasonable
compensation and the expenses and disbursements of its agents and counsel and of all persons not
regularly in its employ) except any such expense, disbursement or advance as may arise from its
gross negligence, willful misconduct or bad faith. The Company also covenants to indemnify the
Trustee in any capacity under this Indenture and any other document or transaction entered into in
connection herewith and its agents and any authenticating agent for, and to hold them harmless
against, any loss, liability or expense incurred without gross negligence, willful misconduct or
bad faith on the part of the Trustee, its officers, directors, agents or employees, or such agent
or authenticating agent, as the case may be, and arising out of or in connection with the
acceptance or administration of this trust or in any other capacity hereunder, including the costs
and expenses of defending themselves against any claim of liability in the premises. The
obligations of the Company under this Section 6.06 to compensate or indemnify the Trustee and to
pay or reimburse the Trustee for expenses, disbursements and advances shall be secured by a lien prior to that of the Notes upon all property and funds held or collected by the Trustee
as such, except, subject to the effect of Section 5.03, funds held in trust herewith for the
benefit of the holders of particular Notes prior to the date of the accrual of such unpaid
compensation or identifiable claim. The Trustee’s right to receive payment of any amounts due
under this Section 6.06 shall not be subordinate to any other liability or Indebtedness of the
Company. The obligation of the Company under this Section 6.06 shall survive the satisfaction and
discharge of this Indenture and the earlier resignation or removal or the Trustee. The Company
need not pay for any settlement made

31

 

without its consent, which consent shall not be unreasonably
withheld. The indemnification provided in this Section 6.06 shall extend to the officers,
directors, agents and employees of the Trustee.

     When the Trustee and its agents and any authenticating agent incur expenses or render services
after an Event of Default specified in Section 5.01(h) or Section 5.01(i) occurs, the expenses and
the compensation for the services are intended to constitute expenses of administration under any
bankruptcy, insolvency or similar laws.

          Section 6.07.   Officers’ Certificate as Evidence. Except as otherwise provided in Section
8.01, whenever in the administration of the provisions of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking or omitting any
action hereunder, such matter (unless other evidence in respect thereof be herein specifically
prescribed) may, in the absence of gross negligence, willful misconduct, recklessness and bad faith
on the part of the Trustee, be deemed to be conclusively proved and established by an Officers’
Certificate delivered to the Trustee, and such Officers’ Certificate, in the absence of gross
negligence, willful misconduct, recklessness and bad faith on the part of the Trustee, shall be
full warrant to the Trustee for any action taken or omitted by it under the provisions of this
Indenture upon the faith thereof.

          Section 6.08.   Conflicting Interests of Trustee. If the Trustee has or shall acquire a
conflicting interest within the meaning of the Trust Indenture Act, the Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by, and subject to the
provisions of, the Trust Indenture Act and this Indenture.

          Section 6.09.   Eligibility of Trustee. There shall at all times be a Trustee hereunder which
shall be a Person that is eligible pursuant to the Trust Indenture Act to act as such and has a
combined capital and surplus of at least $50,000,000. If such Person publishes reports of
condition at least annually, pursuant to law or to the requirements of any supervising or examining
authority, then for the purposes of this Section, the combined capital and surplus of such Person
shall be deemed to be its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Trustee shall cease to be eligible in accordance with
the provisions of this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.

          Section 6.10.   Resignation or Removal of Trustee.

     (a) The Trustee may at any time resign by giving written notice of such resignation to the
Company and by mailing notice thereof to the Noteholders at their addresses as they shall appear on
the Note register. Upon receiving such notice of resignation, the Company shall promptly appoint a
successor trustee by written instrument, in duplicate, executed by order of the Board of Directors,
one copy of which instrument shall be delivered to the resigning Trustee and one copy to the
successor trustee. If no successor trustee shall have been so appointed and have accepted
appointment sixty (60) days after the mailing of such notice of resignation to the Noteholders, the
resigning Trustee may petition any court of competent jurisdiction for the appointment of a
successor trustee, or any Noteholder who has been a bona fide holder of a Note or Notes for at
least six months may, subject to the provisions of Section 5.09, on behalf of

32

 

himself and all
others similarly situated, petition any such court for the appointment of a successor trustee.
Such court may thereupon, after such notice, if any, as it may deem proper and prescribe, appoint a
successor trustee.

     (b) In case at any time any of the following shall occur:

     (i) the Trustee shall fail to comply with Section 6.08 within a reasonable time after
written request therefor by the Company or by any Noteholder who has been a bona fide holder
of a Note or Notes for at least six (6) months, or

     (ii) the Trustee shall cease to be eligible in accordance with the provisions of
Section 6.09 and shall fail to resign after written request therefor by the Company or by
any such Noteholder, or

     (iii) 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 such case, the Company may by a Board Resolution remove the Trustee and appoint a
successor trustee by written instrument, in duplicate, executed by order of the Board of Directors,
one copy of which instrument shall be delivered to the Trustee so removed and one copy to the
successor trustee, or, subject to the provisions of Section 5.09, any Noteholder who has been a
bona fide holder of a Note or Notes for at least six (6) 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.

     (c) The holders of a majority in aggregate principal amount of the Notes at the time
outstanding, as determined in accordance with Section 7.04, may at any time remove the Trustee and
nominate a successor trustee which shall be deemed appointed as successor trustee unless within ten
(10) days after notice to the Company of such nomination the Company objects thereto, in which case
the Trustee so removed or any Noteholder, upon the terms and conditions and otherwise as in Section
6.10(a) provided, may petition any court of competent jurisdiction for an appointment of a
successor trustee.

     (d) Any resignation or removal of the Trustee and appointment of a successor trustee pursuant
to any of the provisions of this Section 6.10 shall become effective upon acceptance of appointment
by the successor trustee as provided in Section 6.11.

          Section 6.11.   Acceptance by Successor Trustee. Any successor trustee appointed as provided
in Section 6.10 shall execute, acknowledge and deliver to the Company and to its predecessor
trustee an instrument accepting such appointment hereunder, and thereupon the resignation or
removal of the predecessor trustee shall become effective and such successor trustee, without any
further act, deed or conveyance, shall become vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with like effect as if originally named as trustee
herein; but, nevertheless, on the written request of the Company or of the

33

 

successor trustee, the
trustee ceasing to act shall, upon payment of any amounts then due it pursuant to the provisions of
Section 6.06, execute and deliver an instrument transferring to such successor trustee all the
rights and powers of the trustee so ceasing to act. Upon request of any such successor trustee,
the Company shall execute any and all instruments in writing for more fully and certainly vesting
in and confirming to such successor trustee all such rights and powers. Any trustee ceasing to act
shall, nevertheless, retain a lien upon all property and funds held or collected by such trustee as
such, except for funds held in trust for the benefit of holders of particular Notes, to secure any
amounts then due it pursuant to the provisions of Section 6.06.

     No successor trustee shall accept appointment as provided in this Section 6.11 unless at the
time of such acceptance such successor trustee shall be qualified under the provisions of Section
6.08 and be eligible under the provisions of Section 6.09.

     Upon acceptance of appointment by a successor trustee as provided in this Section 6.11, each
of the Company and the successor trustee, at the written direction and at the expense of the
Company shall mail or cause to be mailed notice of the succession of such trustee hereunder to the
Noteholders at their addresses as they shall appear on the Note register. If the Company fails to
mail such notice within ten (10) days after acceptance of appointment by the successor trustee, the
successor trustee shall cause such notice to be mailed at the expense of the Company.

          Section 6.12.   Succession by Merger, Etc. Any corporation or other entity into which the
Trustee may be merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation or other entity succeeding to all or substantially all of the corporate trust
business of the Trustee (including the administration of this Indenture), shall be the successor to
the Trustee hereunder without the execution or filing of any paper or any further act on the part
of any of the parties hereto, provided that in the case of any corporation succeeding to all or
substantially all of the corporate trust business of the Trustee such corporation shall be
qualified under the provisions of Section 6.08 and eligible under the provisions of Section 6.09.

     In case at the time such successor to the Trustee shall succeed to the trusts created by this
Indenture, any of the Notes shall have been authenticated but not delivered, any such successor to the Trustee may adopt the certificate of authentication of any predecessor trustee or
authenticating agent appointed by such predecessor trustee, and deliver such Notes so
authenticated, and in case at that time any of the Notes shall not have been authenticated, any
successor to the Trustee or an authenticating agent appointed by such successor trustee may
authenticate such Notes either in the name of any predecessor trustee hereunder or in the name of
the successor trustee; and in all such cases such certificates shall have the full force which it
is anywhere in the Notes or in this Indenture provided that the certificate of the Trustee shall
have; provided, however, that the right to adopt the certificate of authentication of any
predecessor Trustee or to authenticate Notes in the name of any predecessor Trustee shall apply
only to its successor or successors by merger, conversion or consolidation.

          Section 6.13.   Limitation on Rights of Trustee as Creditor. If and when the Trustee shall be
or become a creditor of the Company (or any other obligor upon the Notes), the Trustee shall be
subject to the provisions of the Trust Indenture Act regarding the collection of the claims against
the Company (or any such other obligor).

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     Section 6.14.   Trustee’s Application for Instructions from the Company. Any application by
the Trustee for written instructions from the Company (other than with regard to any action
proposed to be taken or omitted to be taken by the Trustee that affects the rights of the holders
of the Notes under this Indenture) may, at the option of the Trustee, set forth in writing any
action proposed to be taken or omitted by the Trustee under this Indenture and the date on and/or
after which such action shall be taken or such omission shall be effective. The Trustee shall not
be liable for any action taken by, or omission of, the Trustee in accordance with a proposal
included in such application on or after the date specified in such application (which date shall
not be less than three (3) Business Days after the date any officer of the Company actually
receives such application, unless any such officer shall have consented in writing to any earlier
date), unless, prior to taking any such action (or the effective date in the case of any omission),
the Trustee shall have received written instructions in response to such proposal specifying the
action to be taken or omitted.

ARTICLE VII

CONCERNING THE NOTEHOLDERS

     Section 7.01.   Action by Noteholders. Whenever in this Indenture it is provided that the
holders of a specified percentage in aggregate principal amount of the Notes may take any action
(including the making of any demand or request, the giving of any notice, consent or waiver or the
taking of any other action), the fact that at the time of taking any such action, the holders of
such specified percentage have joined therein may be evidenced (a) by any instrument or any number
of instruments of similar tenor executed by Noteholders in person or by agent or proxy appointed in
writing, or (b) by the record of the Noteholders voting in favor thereof at any meeting of
Noteholders duly called and held in accordance with the provisions of Article VIII, or (c) by a
combination of such instrument or instruments and any such record of
such a meeting of Noteholders 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. 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.
Whenever the Company or the Trustee solicits the taking of any action by the holders of the Notes, the
Company or the Trustee may fix, but shall not be required to, in advance of such solicitation, a
date as the record date for determining Noteholders entitled to take such action. The record date
if one is selected shall be not more than fifteen (15) days prior to the date of commencement of
solicitation of such action. Any request, demand, authorization, direction, notice consent, waiver or other action by a Holder of any Note shall bind every future Holder of the same Note and the holder of every Note issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted, or suffered to be done by the Trustee or the Company in reliance thereon, whether or not notation of such action is made upon such Note.

     Section 7.02.   Proof of Execution by Noteholders. Subject to the provisions of Section 6.01,
Section 6.02 and Section 8.05, proof of the execution of any instrument by a Noteholder or his
agent or proxy shall be sufficient if made in accordance with such reasonable rules and regulations
as may be prescribed by the Trustee or in such manner as shall be satisfactory to the Trustee. The
holding of Notes shall be proved by the Note register or by a certificate of the Note Registrar.
The record of any Noteholders’ meeting shall be proved in the manner provided in Section 8.06.

     Section 7.03.   Who Are Deemed Absolute Owners. The Company, the Trustee, any authenticating
agent, any Paying Agent, any Conversion Agent and any Note Registrar may deem the person in whose
name such Note shall be registered upon the Note register to be, and may treat him as, the absolute
owner of such Note (whether or not such Note shall be overdue and notwithstanding any notation of
ownership or other writing thereon made by any Person other than the Company or any Note Registrar)
for the purpose of receiving payment of or on

35

 

account of the principal of and accrued and unpaid
interest on such Note, for conversion of such Note and for all other purposes; and neither the
Company nor the Trustee nor any Paying Agent nor any Conversion Agent nor any Note Registrar shall
be affected by any notice to the contrary. All such payments so made to any holder for the time
being, or upon his order, shall be valid, and, to the extent of the sum or sums so paid, effectual
to satisfy and discharge the liability for monies payable upon any such Note. Notwithstanding
anything to the contrary in this Indenture or the Notes following an Event of Default, any holder
of a beneficial interest in a Global Note may directly enforce against the Company, without the
consent, solicitation, proxy, authorization or any other action of the Depositary or any other
person, such holder’s right to exchange such beneficial interest for a Note in certificated form in
accordance with the provisions of this Indenture.

          Section 7.04. Company-Owned Notes Disregarded. In determining whether the holders of the
requisite aggregate principal amount of Notes have concurred in any direction, consent, waiver or
other action under this Indenture, Notes that are owned by the Company or any other obligor on the
Notes or by any person directly or indirectly controlling or controlled by or under direct or
indirect common control with the Company or any other obligor on such Notes shall be disregarded
and deemed not to be outstanding for the purpose of any such determination; provided that for the
purposes of determining whether the Trustee shall be protected in relying on any such direction,
consent, waiver or other action only Notes that a Responsible Officer knows are so owned shall be
so disregarded. Notes so owned that have been pledged in good faith may be regarded as outstanding
for the purposes of this Section 7.04 if the pledgee shall establish to the satisfaction of the
Trustee the pledgee’s right to vote such Notes and that the pledgee is not the Company,
any other obligor on the Notes or a person directly or indirectly controlling or controlled by
or under direct or indirect common control with the Company or any such other obligor. In the case
of a dispute as to such right, any decision by the Trustee taken upon the advice of counsel shall
be full protection to the Trustee. Upon request of the Trustee, the Company shall furnish to the
Trustee promptly an Officers’ Certificate listing and identifying all Notes, if any, known by the
Company to be owned or held by or for the account of any of the above described persons; and,
subject to Section 6.01, the Trustee shall be entitled to accept such Officers’ Certificate as
conclusive evidence of the facts therein set forth and of the fact that all Notes not listed
therein are outstanding for the purpose of any such determination.

          Section 7.05. Revocation of Consents; Future Holders Bound. At any time prior to (but not
after) the evidencing to the Trustee, as provided in Section 9.01, of the taking of any action by
the holders of the percentage in aggregate principal amount of the Notes specified in this
Indenture in connection with such action, any holder of a Note that is shown by the evidence to be
included in the Notes the holders of which have consented to such action may, by filing written
notice with the Trustee at its Corporate Trust Office and upon proof of holding as provided in
Section 7.02, revoke such action so far as concerns such Note. Except as aforesaid, any such
action taken by the holder of any Note shall be conclusive and binding upon such holder and upon
all future holders and owners of such Note and of any Notes issued in exchange or substitution
therefor, irrespective of whether any notation in regard thereto is made upon such Note or any Note
issued in exchange or substitution therefor.

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ARTICLE VIII

NOTEHOLDERS’ MEETINGS

          Section 8.01. Purpose of Meetings. A meeting of Noteholders may be called at any time and
from time to time pursuant to the provisions of this Article VIII for any of the following
purposes:

     (a) to give any notice to the Company or to the Trustee or to give any directions to the
Trustee permitted under this Indenture, or to consent to the waiving of any default or Event of
Default hereunder and its consequences, or to take any other action authorized to be taken by
Noteholders pursuant to any of the provisions of Article V;

     (b) to remove the Trustee and nominate a successor trustee pursuant to the provisions of
Article VI;

     (c) to consent to the execution of an indenture or indentures supplemental hereto pursuant to
the provisions of Section 9.02; or

     (d) to take any other action authorized to be taken by or on behalf of the holders of any
specified aggregate principal amount of the Notes under any other provision of this Indenture or
under applicable law.

          Section 8.02. Call of Meetings by Trustee. The Trustee may at any time call a meeting of
Noteholders to take any action specified in
Section 8.01, to be held at such time and at such place as the Trustee shall determine. Notice of
every meeting of the Noteholders, setting forth the time and the place of such meeting and in
general terms the action proposed to be taken at such meeting and the establishment of any record
date pursuant to Section 7.01, shall be mailed to holders of such Notes at their addresses as they
shall appear on the Note register. Such notice shall also be mailed to the Company. Such notices
shall be mailed not less than twenty (20) nor more than ninety (90) days prior to the date fixed
for the meeting.

     Any meeting of Noteholders shall be valid without notice if the holders of all Notes then
outstanding are present in person or by proxy or if notice is waived before or after the meeting by
the holders of all Notes outstanding, and if the Company and the Trustee are either present by duly
authorized representatives or have, before or after the meeting, waived notice.

          Section 8.03. Call of Meetings by Company or Noteholders. In case at any time the Company,
pursuant to a resolution of its Board of Directors, or the holders of at least 10% in aggregate
principal amount of the Notes then outstanding, shall have requested the Trustee to call a meeting
of Noteholders, by written request setting forth in reasonable detail the action proposed to be
taken at the meeting, and the Trustee shall not have mailed the notice of such meeting within
twenty (20) days after receipt of such request, then the Company or such Noteholders may determine
the time and the place for such meeting and may call such meeting to take any action authorized in
Section 8.01, by mailing notice thereof as provided in Section 8.02.

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          Section 8.04. Qualifications for Voting. To be entitled to vote at any meeting of
Noteholders a person shall (a) be a holder of one or more Notes on the record date pertaining to
such meeting or (b) be a person appointed by an instrument in writing as proxy by a holder of one
or more Notes. The only persons who shall be entitled to be present or to speak at any meeting of
Noteholders shall be the persons entitled to vote at such meeting and their counsel and any
representatives of the Trustee and its counsel and any representatives of the Company and its
counsel.

          Section 8.05. Regulations. Notwithstanding any other provisions of this Indenture, the
Trustee may make such reasonable regulations as it may deem advisable for any meeting of
Noteholders, in regard to proof of the holding of Notes and of the appointment of proxies, and in
regard to the appointment and duties of inspectors of votes, the submission and examination of
proxies, certificates and other evidence of the right to vote, and such other matters concerning
the conduct of the meeting as it shall think fit.

          The Trustee shall, by an instrument in writing, appoint a temporary chairman of the meeting,
unless the meeting shall have been called by the Company or by Noteholders as provided in Section
8.03, in which case the Company or the Noteholders calling the meeting, as the case may be, shall
in like manner appoint a temporary chairman. A permanent chairman and
a permanent secretary of the meeting shall be elected by vote of the holders of a majority in
principal amount of the Notes represented at the meeting and entitled to vote at the meeting.

          Subject to the provisions of Section 7.04, at any meeting of Noteholders each Noteholder or
proxyholder shall be entitled to one vote for each $1,000 principal amount of Notes held or
represented by him; provided, however, that no vote shall be cast or counted at any meeting in
respect of any Note challenged as not outstanding and ruled by the chairman of the meeting to be
not outstanding. The chairman of the meeting shall have no right to vote other than by virtue of
Notes held by him or instruments in writing as aforesaid duly designating him as the proxy to vote
on behalf of other Noteholders. Any meeting of Noteholders duly called pursuant to the provisions
of Section 8.02 or Section 8.03 may be adjourned from time to time by the holders of a majority of
the aggregate principal amount of Notes represented at the meeting, whether or not constituting a
quorum, and the meeting may be held as so adjourned without further notice.

          Section 8.06. Voting. The vote upon any resolution submitted to any meeting of Noteholders
shall be by written ballot on which shall be subscribed the signatures of the Noteholders or of
their representatives by proxy and the principal amount of the Notes held or represented by them.
The permanent chairman of the meeting shall appoint two inspectors of votes who shall count all
votes cast at the meeting for or against any resolution and who shall make and file with the
secretary of the meeting their verified written reports in duplicate of all votes cast at the
meeting. A record in duplicate of the proceedings of each meeting of Noteholders shall be prepared
by the secretary of the meeting and there shall be attached to said record the original reports of
the inspectors of votes on any vote by ballot taken thereat and affidavits by one or more persons
having knowledge of the facts setting forth a copy of the notice of the meeting and showing that
said notice was mailed as provided in Section 8.02. The record shall show the principal amount of
the Notes voting in favor of or against any resolution. The record shall be signed and verified by
the affidavits of the permanent chairman and secretary of the meeting and one of the duplicates
shall be delivered to the Company and the other to the

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Trustee to be preserved by the Trustee, the
latter to have attached thereto the ballots voted at the meeting.

     Any record so signed and verified shall be conclusive evidence of the matters therein stated.

          Section 8.07. No Delay of Rights by Meeting. Nothing contained in this Article VIII shall be
deemed or construed to authorize or permit, by reason of any call of a meeting of Noteholders or
any rights expressly or impliedly conferred hereunder to make such call, any hindrance or delay in
the exercise of any right or rights conferred upon or reserved to the Trustee or to the Noteholders
under any of the provisions of this Indenture or of the Notes.

ARTICLE IX

SUPPLEMENTAL INDENTURES

          Section 9.01. Supplemental Indentures Without Consent of Noteholders. The Company, when
authorized by the resolutions of the Board of Directors, and the Trustee, at the Company’s expense,
may from time to time and at any time enter into an indenture or indentures supplemental hereto for
one or more of the following purposes:

     (a) to cure any ambiguity, omission, defect or inconsistency;

     (b) to provide for the assumption by a Successor Company of the obligations of the Company
under the Indenture pursuant to Article X;

     (c) to provide for uncertificated Notes in addition to or in place of certificated Notes
(provided that the uncertificated Notes are issued in registered form for purposes of Section
163(f) of the Code, or in a manner such that the uncertificated Notes are described in Section
163(f)(2)(B) of the Code);

     (d) to add guarantees with respect to the Notes;

     (e) to secure the Notes;

     (f) to add to the covenants of the Company for the benefit of the holders or surrender any
right or power conferred upon the Company;

     (g) to make any change that does not materially adversely affect the rights of any holder; or

     (h) to comply with any requirements of the Commission in connection with the qualification of
the Indenture under the Trust Indenture Act.

     Upon the written request of the Company, accompanied by a Board Resolution authorizing the
execution of such supplemental indenture, the Trustee is hereby authorized to join with the Company
in the execution of any such supplemental indenture, to make any further appropriate agreements and
stipulations which may be therein contained and to accept the

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conveyance, transfer and assignment
of any property thereunder, but the Trustee shall not be obligated to, but may in its discretion,
enter into any supplemental indenture which affects the Trustee’s own rights, duties or immunities
under this Indenture or otherwise.

     Any supplemental indenture authorized by the provisions of this Section 9.01 may be executed
by the Company and the Trustee without the consent of the holders of any of the Notes at the time
outstanding.

          Section 9.02. Supplemental Indentures With Consent of Noteholders. With the consent (evidenced as provided in Article VII) of the holders of at least a
majority in aggregate principal amount of the Notes at the time outstanding (determined in
accordance with Article VII and including, without limitation, consents obtained in connection with
a purchase of, or tender offer or exchange offer for, Notes), the Company, when authorized by the
resolutions of the Board of Directors, and the Trustee may from time to time and at any time enter
into an indenture or indentures supplemental hereto for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Indenture or any supplemental
indenture or of modifying in any manner the rights of the holders of the Notes; provided, however,
that no such supplemental indenture shall:

     (a) reduce the percentage in aggregate principal amount of Notes the holders of which must
consent to an amendment;

     (b) reduce the rate, or extend the stated time for payment, of interest on any Note;

     (c) reduce the principal, or extend the Maturity Date, of any Note;

     (d) make any change that adversely affects the conversion rights of any Notes;

     (e) reduce the Designated Event Repurchase Price of any Note or amend or modify in any manner
adverse to the holders of the Notes the Company’s obligation to make such payments, whether through
an amendment or waiver of provisions in the covenants, definitions or otherwise;

     (f) change the place or currency of payment of principal or interest in respect of any Note;

     (g) impair the right of any holder to receive payment of principal of, and interest, on, such
holder’s Notes on or after the due dates therefor or to institute suit for the enforcement of any
payment on or with respect to such holder’s Note; or

     (h) make any change in the provisions of this Article IX that require each holder’s consent or
in the waiver provisions in Section 5.01 and Section 5.07,

in each case without the consent of each holder of an outstanding Note affected.

     Upon the written request of the Company, accompanied by a copy of the Board Resolutions
authorizing the execution of any such supplemental indenture, and upon the filing with the Trustee
of evidence of the consent of Noteholders as aforesaid, the Trustee shall join

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with the Company in
the execution of such supplemental indenture unless such supplemental indenture affects the
Trustee’s own rights, duties or immunities under this Indenture or otherwise, in which case the
Trustee may in its discretion, but shall not be obligated to, enter into such supplemental
indenture.

     It shall not be necessary for the consent of the Noteholders under this Section 9.02 to
approve the particular form of any proposed supplemental indenture, but it shall be sufficient if
such consent shall approve the substance thereof. After an amendment under the Indenture becomes
effective, the Company shall mail to the holders a notice briefly describing such
amendment. However, the failure to give such notice to all the holders, or any defect in the
notice, will not impair or affect the validity of the amendment.

          Section 9.03. Effect of Supplemental Indentures. Any supplemental indenture executed
pursuant to the provisions of this Article IX shall comply with the Trust Indenture Act, as then in
effect, provided that this Section 9.03 shall not require such supplemental indenture or the
Trustee to be qualified under the Trust Indenture Act prior to the time such qualification is in
fact required under the terms of the Trust Indenture Act, nor shall it constitute any admission or
acknowledgment by any party to such supplemental indenture that any such qualification is required
prior to the time such qualification is in fact required under the terms of the Trust Indenture
Act. Upon the execution of any supplemental indenture pursuant to the provisions of this Article
IX, this Indenture shall be and be deemed to be modified and amended in accordance therewith and
the respective rights, limitation of rights, obligations, duties and immunities under this
Indenture of the Trustee, the Company and the Noteholders shall thereafter be determined, exercised
and enforced hereunder subject in all respects to such modifications and amendments and all the
terms and conditions of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.

          Section 9.04. Notation on Notes. Notes authenticated and delivered after the execution of
any supplemental indenture pursuant to the provisions of this Article IX may bear a notation in
form approved by the Trustee as to any matter provided for in such supplemental indenture. If the
Company or the Trustee shall so determine, new Notes so modified as to conform, in the opinion of
the Trustee and the Board of Directors, to any modification of this Indenture contained in any such
supplemental indenture may, at the Company’s expense, be prepared and executed by the Company,
authenticated by the Trustee (or an authenticating agent duly appointed by the Trustee pursuant to
Section 15.11) and delivered in exchange for the Notes then outstanding, upon surrender of such
Notes then outstanding.

          Section 9.05. Evidence of Compliance of Supplemental Indenture to Be Furnished Trustee. In
addition to the documents required by Section 15.05, the Trustee shall receive an Officers’
Certificate and an Opinion of Counsel as conclusive evidence that any supplemental indenture
executed pursuant hereto complies with the requirements of this Article IX.

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ARTICLE X

CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE

          Section 10.01. Company May Consolidate, etc. on Certain Terms. Subject to the provisions of
Section 10.02, the Company shall not consolidate with, merge with or into, or convey, transfer or
lease all or substantially all of its assets and properties to another Person, unless:

     (a) the resulting, surviving or transferee Person (the “Successor Company”) if not the Company
shall be a Person organized and existing under the laws of the United States of America, any State
thereof or the District of Columbia and the Successor Company (if not the Company) shall expressly
assume, by supplemental indenture, executed and delivered to the Trustee, in form satisfactory to
the Trustee, all the obligations of the Company under the Notes, this Indenture and, to the extent
that it is otherwise still operative, shall expressly assume all the obligations of the Company
under the Registration Rights Agreement; and

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

     For purposes of this Section 10.01, the sale, lease, conveyance, assignment, transfer, or
other disposition of all or substantially all of the properties and assets of one or more
Subsidiaries of the Company, which properties and assets, if held by the Company instead of such
Subsidiaries, would constitute all or substantially all of the properties and assets of the Company
on a consolidated basis, shall be deemed to be the transfer of all or substantially all of the
properties and assets of the Company.

          Section 10.02. Successor Corporation to be Substituted. In case of any such consolidation,
merger, conveyance, transfer or lease and upon the assumption by the Successor Company, by
supplemental indenture, executed and delivered to the Trustee and satisfactory in form to the
Trustee, of the due and punctual payment of the principal of and accrued and unpaid interest on all
of the Notes, the due and punctual conversion of the Notes and the due and punctual performance of
all of the covenants and conditions of this Indenture to be performed by the Company, such
Successor Company shall succeed to and be substituted for the Company and the Company shall be
released from those obligations, with the same effect as if it had been named herein as the party
of the first part. Such Successor Company thereupon may cause to be signed, and may issue either
in its own name or in the name of the Company any or all of the Notes issuable hereunder which
theretofore shall not have been signed by the Company and delivered to the Trustee; and, upon the
order of such Successor Company instead of the Company and subject to all the terms, conditions and
limitations in this Indenture prescribed, the Trustee shall authenticate and shall deliver, or
cause to be authenticated and delivered, any Notes which previously shall have been signed and
delivered by the officers of the Company to the Trustee for authentication, and any Notes which
such Successor Company thereafter shall cause to be signed and delivered to the Trustee for that
purpose. All the Notes so issued shall in all respects have the same legal rank and benefit under
this Indenture as the Notes theretofore or thereafter issued in accordance with the terms of this
Indenture as though all of such Notes had been issued at the date of the execution hereof. In the
event of any such consolidation, merger,

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conveyance, transfer or lease, the person named as the
“Company” in the first paragraph of this Indenture or any successor which shall thereafter have
become such in the manner prescribed in this Article X may be dissolved, wound up and liquidated at
any time thereafter and such person shall be released from its liabilities as obligor and maker of
the Notes and from its obligations under this Indenture.

     In case of any such consolidation, merger, conveyance, transfer or lease, such changes in
phraseology and form (but not in substance) may be made in the Notes thereafter to be issued as may
be appropriate.

          Section 10.03. Officer’s Certificate and Opinion of Counsel to Be Given Trustee. No merger,
consolidation, sale transfer or lease shall be effective unless the Trustee shall receive an
Officers’ Certificate and an Opinion of Counsel as conclusive evidence that any such consolidation,
merger, conveyance, transfer or lease and any such assumption complies with the provisions of this
Article X.

ARTICLE XI

SATISFACTION AND DISCHARGE OF INDENTURE

          Section 11.01. Discharge of Indenture. When (a) the Company shall deliver to the Note
Registrar for cancellation all Notes theretofore authenticated (other than any Notes that have been
destroyed, lost or stolen and in lieu of or in substitution for which other Notes shall have been
authenticated and delivered) and not theretofore canceled, or (b) all the Notes not theretofore
canceled or delivered to the Notes registrar for cancellation shall have become due and payable,
whether on the Maturity Date or on any earlier Designated Event Repurchase Date or otherwise, and
the Company shall deposit with the Trustee, in trust, cash or shares of Common Stock, as
applicable, sufficient to pay at maturity all of the Notes (other than any Notes that shall have
been mutilated, destroyed, lost or stolen and in lieu of or in substitution for which other Notes
shall have been authenticated and delivered) not theretofore canceled or delivered to the Trustee
for cancellation, including principal and accrued and unpaid interest due thereon, and if the
Company shall also pay or cause to be paid all other sums payable hereunder by the Company, then
this Indenture shall cease to be of further effect except as to (i) the right of holders to receive
payments of principal of and accrued and unpaid interest, and any unpaid Conversion Obligation and
Additional Shares, if any, on, the Notes and the other rights, duties and obligations of
Noteholders, as beneficiaries hereof with respect to the amounts, if any, so deposited with the
Trustee (ii) the rights, obligations and immunities of the Trustee hereunder and (iii) the
obligations of the Company under Section 6.06, and the Trustee, on written demand of the Company
accompanied by an Officers’ Certificate and an Opinion of Counsel as required by Section 15.05 and
at the cost and expense of the Company, shall execute proper instruments acknowledging satisfaction
of and discharging this Indenture; the Company, however, hereby agrees to reimburse the Trustee for
any costs or expenses thereafter reasonably and properly incurred by the Trustee and to compensate
the Trustee for any services thereafter reasonably and properly rendered by the Trustee in
connection with this Indenture or the Notes.

          Section 11.02. Deposited Monies to Be Held in Trust by Trustee. Subject to Section 11.04,
all monies deposited with the Trustee pursuant to Section 11.01 shall be held in

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trust and applied
by it to the payment, either directly or through any Paying Agent (including the Company if acting
as its own Paying Agent), to the holders of
the particular Notes for the payment of which such monies have been deposited with the
Trustee, of all sums due thereon for principal and accrued and unpaid interest.

          Section 11.03. Paying Agent to Repay Monies Held. Upon the satisfaction and discharge of
this Indenture, all monies then held by any Paying Agent of the Notes (other than the Trustee)
shall, upon written request of the Company, be repaid to it or paid to the Trustee, and thereupon
such Paying Agent shall be released from all further liability with respect to such monies.

          Section 11.04. Return of Unclaimed Monies. Subject to the requirements of applicable law,
any monies deposited with or paid to the Trustee for payment of the principal of or accrued and
unpaid interest on, Notes and not applied but remaining unclaimed by the Noteholders for two years
after the date upon which the principal of or accrued and unpaid interest on such Notes, as the
case may be, shall have become due and payable, shall be repaid to the Company by the Trustee on
written request and all liability of the Trustee shall thereupon cease with respect to such monies;
and the holder of any of the Notes shall thereafter look only to the Company for any payment which
such holder may be entitled to collect unless an applicable abandoned property law designates
another person. The Trustee shall, promptly after such payment of the principal of, and any
accrued and unpaid interest, on Notes, as described in this Section 11.04 and upon written request
of the Company, return to the Company any funds in excess of the amount required for such payment.

          Section 11.05. Reinstatement. If (i) the Trustee or the Paying Agent is unable to apply any
money in accordance with Section 11.02 by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such application and (ii)
the holders of at least a majority in principal amount of the then outstanding Notes so request by
written notice to the Trustee, the Company’s obligations under this Indenture shall be revived and
reinstated as though no deposit had occurred pursuant to Section 11.01 until such time as the
Trustee or the Paying Agent is permitted to apply all such money in accordance with Section 11.02;
provided, however, that if the Company makes any payment of interest on or principal of any Note
following the reinstatement of its obligations, the Company shall be subrogated to the rights of
the Noteholders to receive such payment from the money held by the Trustee or Paying Agent.

ARTICLE XII

IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS

          Section 12.01. Indenture and Notes Solely Corporate Obligations. No recourse for the
payment of the principal of, or accrued and unpaid interest on, any Note, or for any claim based
thereon or otherwise in respect thereof, and no recourse under or upon any obligation, covenant or
agreement of the Company in this Indenture or in any supplemental indenture or in any Note, or
because of the creation of any Indebtedness represented thereby, shall be had against any past,
present or future incorporator, stockholder,
employee, agent, officer or director or Subsidiary of the Company as such or of any successor
corporation, either directly or through

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the Company or any successor corporation, whether by virtue
of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or
otherwise; it being expressly understood that all such liability is hereby expressly waived and
released as a condition of, and as a consideration for, the execution of this Indenture and the
issue of the Notes.

ARTICLE XIII

CONVERSION OF NOTES

          Section 13.01. Conversion Privilege.

     (a) Subject to the conditions described in clause (i), (ii), and (iii) below, and upon
compliance with the provisions of this Article XIII, a Noteholder shall have the right, at such
holder’s option, to convert all or any portion (if the portion to be converted is $1,000 principal
amount or an integral multiple thereof) of such Note at any time prior to the close of business on
the scheduled Trading Day immediately preceding February [___], 2013 at a rate (the “Conversion
Rate”) of [___] shares of Common Stock (subject to adjustment by the Company as provided in
Section 13.04) per $1,000 principal amount Note (the “Conversion Obligation”) under the
circumstances and during the periods set forth below. On and after February [___], 2013, regardless
of the conditions described in clause (i), (ii) and (iii) below, and upon compliance with the
provisions of this Article XIII, a Noteholder shall have the right, at such holder’s option, to
convert all or any portion (if the portion to be converted is $1,000 principal amount or an
integral multiple thereof) of such Note at any time prior to the close of business on the scheduled
Trading Day immediately preceding the Maturity Date.

     (i) The Notes shall be convertible prior to February [___], 2013, during the five
Business Day period immediately after any five consecutive Trading Day period (the
“Measurement Period”) in which the Trading Price per $1,000 principal amount of Notes for
each day of such Measurement Period was less than 98% of the product of the Last Reported
Sale Price of the Common Stock on such date and the Conversion Rate on such date, all as
determined by the Trustee. The Trustee shall have no obligation to determine the Trading
Price of the Notes unless requested by the Company to do so in writing, and the Company
shall have no obligation to make such request unless a Noteholder provides the Company with
reasonable evidence that the Trading Price of the Notes would be less than 98% of the
product of (a) the then-applicable Conversion Rate of the Notes and (b) the Last Reported
Sale Price at such time, at which time the Company shall instruct the Trustee to determine
the Trading Price of the Notes beginning on the next Trading Day and on each successive
Trading Day until the Trading Price per Note is greater than or equal to 98% of the product
of (a) the then-applicable Conversion Rate of the Notes and (b) the Last Reported Sale Price
on such date. If the Trading Price condition set forth above has been met, the Company
shall so notify the Noteholders. If, at any time after the Trading Price condition set
forth above has been met, the Trading Price per $1,000 principal amount of Notes is greater
than 98% of the product of (a) the
then-applicable Conversion Rate of the Notes and (b) the Last Reported Sale Price on
such date, the Company shall so notify the Noteholders.

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     (ii) The Notes shall be convertible prior to February [___], 2013, during any calendar
quarter after the calendar quarter ending June 30, 2006, if the Last Reported Sale Price of
the Common Stock for twenty (20) or more Trading Days in a period of thirty (30) consecutive
Trading Days ending on the last Trading Day of the immediately preceding calendar quarter
exceeds 120% of the applicable Conversion Price in effect on the last Trading Day of the
immediately preceding calendar quarter.

     (iii) The Notes shall be convertible prior to February [___], 2013 as provided in
Section 13.01(b), Section 13.01(c) and Section 13.01(d).

     (b) In the event that the Company elects to:

     (i) distribute to all or substantially all holders of Common Stock rights entitling
them to purchase, for a period expiring within 60 days after the record date for such
distribution, Common Stock at a price less than the Last Reported Sale Price of the Common
Stock for the Trading Day immediately preceding the declaration date of such distribution;
or

     (ii) distribute to all or substantially all holders of Common Stock, assets or debt
securities of the Company or rights to purchase the Company’s securities, which distribution
has a per share value (as determined by the Board of Directors) exceeding 10% of the Last
Reported Sale Price of the Common Stock on the day immediately preceding the date of
declaration of such distribution,

then, in either case, holders may surrender the Notes for conversion at any time on and after the
date that the Company provides notice to holders referred to in the next sentence until the earlier
of the close of business on the Business Day immediately preceding the Ex-Dividend Date for such
distribution or the date the Company announces that such distribution will not take place. The
Company shall notify holders of any distribution referred to in either clause (i) or clause (ii)
above and of the resulting conversion right no later than the 20th Business Day prior to
the Ex-Dividend Date for such distribution. Holders may not exercise this right if such Holder
participates in the distribution without conversion.

     (c) If the Company consolidates with or merges with or into another Person or is a party to a
binding share exchange or conveys, transfers, sells, leases or otherwise disposes of all or
substantially all of its properties and assets in each case pursuant to which the Common Stock
would be converted into cash, securities and/or other property, then the holders shall have the
right to convert Notes at any time beginning fifteen calendar days prior to the date announced by
the Company as the anticipated effective date of the transaction and until and including the date
that is fifteen calendar days after the date that is the effective date of such transaction;
provided such transaction does not otherwise constitute a Designated Event to which the provisions
of Section 13.01(d) shall apply. The Company will notify holders of Notes at least 20 calendar
days prior to the anticipated effective date of such transaction. The Board of Directors shall
determine the anticipated effective date of the transaction, and such determination shall be
conclusive and binding on the holders and shall be publicly announced by the Company and
posted on its web site not later than two Business Day prior to such 15th day.

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     (d) If the Company is a party to any transaction or event that constitutes a Designated Event,
a holder may surrender Notes for conversion at any time from and after the 30th scheduled Trading
Day prior to the anticipated effective date of such transaction or event until the related
Designated Event Repurchase Date and, upon such surrender, if such Designated Event also
constitutes a Fundamental Change, the holder shall be entitled to the increase in the Conversion
Rate, if any, specified in Section 13.01(e); provided, however
that no increase will be made in the case of Fundamental Change if at
least 90% of the consideration paid of the Company’s Common Stock
(excluding cash payments for fractional shares and cash payments made
pursuant to dissenters’ appraisal rights) in such Fundamental Change
transaction consists of shares of capital stock traded on the New
York Stock Exchange or another U.S. national securities exchange or
quoted on NASDAQ National Market or another established automated
over-the-counter trading market in the United States (or that will
be so traded or quoted immediately following the transaction) and as
a result of such transaction or transactions the notes become
convertible solely into such common stock. The Company shall give
notice in writing to all record
Noteholders and the Trustee of the Designated Event no later than 30 scheduled Trading Days prior
to the anticipated effective date of the Designated Event.

     (e) (i) If a Noteholder elects to convert Notes in connection with a Fundamental Change that
occurs prior to May [___], 2013, the Conversion Rate applicable to each $1,000 principal amount of
Notes so converted shall be increased by an additional number of shares of Common Stock (the
“Additional Shares”) as described below. Settlement of Notes tendered for conversion to which
Additional Shares shall be added to the Conversion Rate as provided in this subsection shall be
settled pursuant to Section 13.02(d) below. For purposes of this Section 13.01(e), a conversion
shall be deemed to be “in connection” with a Fundamental Change to the extent that such conversion
is effected during the time period specified in Section 13.01(d) (regardless of whether the
provisions of clause (a)(i), (a)(ii), (b) or (c) of this Section 13.01 shall apply to such
conversion).

     (ii) The number of Additional Shares by which the Conversion Rate will be increased
shall be determined by reference to the table attached as Schedule A hereto, based on the
date on which the Fundamental Change occurs or becomes effective (the “Effective Date”), and
the Stock Price; provided that if the actual Stock Price is between two Stock Price amounts
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 next higher and next lower Stock Price amounts and
the two nearest Effective Dates, as applicable, based on a 365-day year; provided further
that if (1) the Stock Price is greater than $[•] per share of Common Stock (subject to
adjustment in the same manner as set forth in Section 13.04), no Additional Shares will be
added to the Conversion Rate, and (2) the Stock Price is less than $[•] per share (subject
to adjustment in the same manner as set forth in Section 13.04), no Additional Shares will
be added to the Conversion Rate. Notwithstanding the foregoing, in no event will the total
number of shares of Common Stock issuable upon conversion exceed [•] per $1,000 principal
amount of Notes (subject to adjustment in the same manner as set forth in Section 13.04).

     (iii) The Stock Prices set forth in the first row of the table in Schedule A hereto
shall be adjusted by the Company as of any date on which the Conversion Rate of the Notes is 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 in
effect immediately prior to the 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
within the table shall be adjusted in the same manner as the
Conversion Rate as set forth in Section 13.04 (other than by operation of an adjustment
to the Conversion Rate by adding Additional Shares).

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          Section 13.02. Conversion Procedure.

     (a) Subject to Section 13.02(b), the Company will satisfy the Conversion Obligation with
respect to each $1,000 principal amount of Notes tendered for conversion in cash and shares of
fully paid Common Stock, if applicable, by delivering, on the third Trading Day immediately
following the last day of the related Observation Period, cash and shares of Common Stock, if any,
equal to the sum of the Daily Settlement Amounts for each of the 20 Trading Days during the related
Observation Period; provided that the Company will deliver cash in lieu of fractional shares of
Common Stock as set forth pursuant to clause (k) below. The Daily Settlement Amounts shall be
determined by the Company promptly following the last day of the Observation Period.

     (b) Notwithstanding Section 13.02(a), the Company shall satisfy the Conversion Obligation with
respect to each $1,000 principal amount of Notes tendered for conversion to which Additional Shares
shall be added to the Conversion Rate as set forth in Section 13.01(e) pursuant to this clause (b).

     (A) If the last day of the applicable Observation Period related to Notes
surrendered for conversion is prior to the third Trading Day preceding the Effective
Date of the Fundamental Change, the Company will satisfy the related Conversion
Obligation with respect to each $1,000 principal amount of Notes tendered for
conversion as described in Section 13.02(b) by delivering the cash and shares of
Common Stock (based on the Conversion Rate, but without regard to the number of
Additional Shares to be added to the Conversion Rate pursuant to Section 13.01(e))
on the third Trading Day immediately following the last day of the applicable
Observation Period. As soon as practicable following the Effective Date of the
Fundamental Change, the Company will deliver the increase in such amount of cash and
Reference Property in lieu of shares of Common Stock, if any, as if the Conversion
Rate had been increased by such number of Additional Shares during the related
Observation Period (and based upon the related Daily VWAP prices during such
Observation Period). If such increased amount of cash and shares, if any, results
in an increase to the amount of cash to be paid to holders, the Company will pay
such increase in cash, and if such increased amount results in an increase to the
number of shares of Common Stock, the Company will deliver such increase by
delivering Reference Property based on such increased number of shares.

     (B) If the last day of the applicable Observation Period related to Notes
surrendered for conversion is on or following the third scheduled Trading Day
preceding the Effective Date of such Fundamental Change, the Company will satisfy
the Conversion Obligation with respect to each $1,000 principal amount of Notes
tendered for conversion as described in Section 13.01(b) (based on the Conversion
Rate as increased by the Additional Shares pursuant to Section 13.01(e) above) on
the later to occur of (1) the Effective Date of the
Fundamental Change and (2) the third Trading Day immediately following the last
day of the applicable Observation Period.

48

 

     (c) Before any holder of a Note shall be entitled to convert the same as set forth above, such
holder shall (1) in the case of a Global Note, comply with the procedures of the Depositary in
effect at that time and, if required, pay funds equal to interest payable on the next Interest
Payment Date to which such holder is not entitled as set forth in Section 13.02(i) and, if
required, pay all taxes or duties, if any, and (2) in the case of a Note issued in certificated
form, (A) complete and manually sign and deliver an irrevocable written notice to the Conversion
Agent in the form on the reverse of such certificated Note (or a facsimile thereof) (a “Notice of
Conversion”) at the office of the Conversion Agent and shall state in writing therein the principal
amount of Notes to be converted and the name or names (with addresses) in which such holder wishes
the certificate or certificates for any shares of Common Stock, if any, to be delivered upon
settlement of the Conversion Obligation to be registered, (B) surrender such Notes, duly endorsed
to the Company or in blank (and accompanied by appropriate endorsement and transfer documents), at
the office of the Conversion Agent, (C) if required, pay funds equal to interest payable on the
next Interest Payment Date to which such holder is not entitled as set forth in Section 13.02(i),
and (D) if required, pay all taxes or duties, if any. A Note shall be deemed to have been
converted immediately prior to the close of business on the date (the “Conversion Date”) that the
holder has complied with the requirements set forth in this Section 13.02(c).

     No Notice of Conversion with respect to any Notes may be tendered by a holder thereof if such
holder has also tendered a Designated Event Repurchase Notice and not validly withdrawn such
Designated Event Repurchase Notice in accordance with the applicable provisions of Section 14.01 or
14.02, as the case may be.

     If more than one Note shall be surrendered for conversion at one time by the same holder, the
Conversion Obligation with respect to such Notes, if any, that shall be payable upon conversion
shall be computed on the basis of the aggregate principal amount of the Notes (or specified
portions thereof to the extent permitted thereby) so surrendered.

     (d) Delivery of the amounts owing in satisfaction of the Conversion Obligation shall be made
by the Company in no event later than the date specified in Section 13.02(a), except to the extent
specified in Section 13.02(b). The Company shall make such delivery by paying the cash amount owed
to the Conversion Agent or to the holder of the Note surrendered for conversion, or such holder’s
nominee or nominees, and by issuing, or causing to be issued, and delivering to the Conversion
Agent or to such holder, or such holder’s nominee or nominees, certificates or a book-entry
transfer through the Depositary for the number of full shares of Common Stock, if any, to which
such holder shall be entitled as part of such Conversion Obligation (together with any cash in lieu
of fractional shares).

     (e) In case any Note shall be surrendered for partial conversion, the Company shall execute
and the Trustee shall authenticate and deliver to or upon the written order of the holder of the
Note so surrendered, without charge to such holder, a new Note or Notes in authorized denominations
in an aggregate principal amount equal to the unconverted portion of the surrendered Notes.

     (f) If a holder submits a Note for conversion, the Company shall pay all stamp and other duties,
if any, which may be imposed by the United States or any political subdivision

49

 

thereof or
taxing authority thereof or therein with respect to the issuance of shares of Common Stock,
if any, upon the conversion. However, the holder shall pay any such tax which is due because
the holder requests any shares of Common Stock to be issued in a name other than the holder’s name.
The Conversion Agent may refuse to deliver the certificates representing the shares of Common Stock
being issued in a name other than the holder’s name until the Trustee receives a sum sufficient to
pay any tax which will be due because the shares are to be issued in a name other than the holder’s name.
Nothing herein shall preclude any tax withholding required by law or regulations.

     (g) Except as provided in Section 13.04, no adjustment shall be made for dividends on any shares
issued upon the conversion of any Note as provided in this Article.

     (h) Upon the conversion of an interest in a Global Note, the Trustee, or the Custodian at the direction of the Trustee, shall make a notation on such Global Note as to the reduction in the principal amount represented thereby. The Company shall notify the Trustee in writing of any conversion of Notes effected through any Conversion Agent other than the Trustee.

     (i) Upon conversion, a Noteholder will not receive any separate cash payment for accrued and unpaid interest except as set forth below. The Company’s settlement of the Conversion Obligations as described above shall be deemed to satisfy its obligation to pay the principal amount of the Note and accrued and unpaid interest to, but not including, the Conversion Date. As a result, accrued and unpaid interest to, but not including, the Conversion Date shall be deemed to be paid in full rather than cancelled, extinguished or forfeited. Notwithstanding the preceding sentence, if Notes are converted after the close of business on a record date, holders of such Notes as of the close of business on the record date will receive the interest payable on such Notes on the corresponding Interest Payment Date notwithstanding the conversion. Notes surrendered for conversion during the period from the close of business on any regular record date to the opening of business on the corresponding Interest Payment Date must be accompanied by payment of an amount equal to the interest payable on the Notes so converted; provided, however, that no such payment need be made (i) if the Company has specified a Designated Event Purchase Date that is after a Record Date and on or prior to the corresponding Interest Payment Date; or (ii) to the extent of any overdue interest existing at the time of conversion with respect to such Note. Except as described above, no payment or adjustment will be made for accrued interest on converted Notes.

     (j) The Person in whose name the certificate for any shares of Common Stock issued upon conversion is registered shall be treated as a stockholder of record on and after the Conversion Date; provided, however, that no surrender of Notes on any date when the stock transfer books of the Company shall be closed shall be effective to constitute the Person or Persons entitled to receive the shares of Common Stock upon such conversion as the record holder or holders of such shares of Common Stock on such date, but such surrender shall be effective to constitute the Person or Persons entitled to receive such shares of Common Stock as the record holder or holders thereof for all purposes at the close of business on the next succeeding day on which such stock transfer books are open; such conversion shall be at the Conversion Rate in effect on the date that such Notes shall have been surrendered for conversion, as if the stock transfer books of the Company had not been closed. Upon conversion of Notes, such Person shall no longer be a Noteholder.

50

 

     (k) No fractional shares of Common Stock shall be issued upon conversion of any Note or
Notes. If more than one Note shall be surrendered for conversion at one time by the same holder,
the number of full shares that shall be issued upon conversion thereof shall be computed on the
basis of the aggregate principal amount of the Notes (or specified portions thereof) so
surrendered. Instead of any fractional share of Common Stock that would otherwise be issued upon
conversion of any Note or Notes (or specified portions thereof), the Company shall pay a cash
adjustment in respect of such fraction (calculated to the nearest one-100th of a share) in an
amount equal to the same fraction of the Last Reported Sale Price of the Common Stock on the last
day of the applicable Observation Period.

          Section 13.03. [Intentionally Omitted].

          Section 13.04. Adjustment of Conversion Rate. The Conversion Rate shall be adjusted from
time to time by the Company as follows:

     (a) In case the Company shall issue shares of Common Stock as a dividend or distribution to
holders of all or substantially all of the outstanding Common Stock, or shall effect a subdivision
into a greater number of shares of Common Stock or combination into a lesser number of shares of
Common Stock, the Conversion Rate shall be adjusted based on the following formula:

	 	 	 	 	 	 	 
	 

	 	CR’= CR0 x
  	OS’	 	 
	 

	 	
OS0

	 	 

where

CR0 = the Conversion Rate in effect immediately prior to the Ex-Dividend
Date for such event;

CR’ = the Conversion Rate in effect immediately after the Ex-Dividend Date for such
event;

OS0 = the number of shares of Common Stock outstanding immediately prior
to the Ex-Dividend Date for such event;

OS’ = the number of shares of Common Stock outstanding immediately after the
Ex-Dividend Date for such event.

Such adjustment shall become effective immediately after 9:00 a.m., New York City time, on the
Business Day following the Record Date fixed for such determination. If any dividend or
distribution of the type described in this Section 13.04(a) is declared but not so paid or made, or
the outstanding shares of Common Stock are not subdivided or combined, as the case may be, the
Conversion Rate shall be immediately readjusted, effective as of the date the Board of Directors
determines not to pay such dividend or distribution, or subdivide or combine the outstanding shares
of Common Stock, as the case may be, to the Conversion Rate that would then be in effect if such
dividend, distribution, subdivision or combination had not been declared.

51

 

     (b) In case the Company shall issue to all or substantially all holders of its outstanding
shares of Common Stock rights or warrants entitling them (for a period expiring within sixty (60)
calendar days after the issuance thereof) to subscribe for or purchase shares of Common Stock at a
price per share less than the Last Reported Sale Price of the Common Stock on the Business Day
immediately preceding the date of announcement of such issuance, the Conversion Rate shall be
adjusted based on the following formula:

	 	 	 	 	 	 	 
	 

	 	CR’= CR0 x
  	OS0 + X	 	 
	 

	 	 

OS0 + Y	 	 

where

	 	CR0  	 = 	the Conversion Rate in effect immediately prior to the Ex-Dividend Date for
such event;
	 
	 	CR’	 = 	the Conversion Rate in effect immediately after the Ex-Dividend Date for such
event;
	 
	 	OS0  	 = 	the number of shares of Common Stock outstanding immediately prior to the
Ex-Dividend Date for such event;
	 
	 	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 or convert such rights or warrants divided by the average of the Last Reported
Sale Prices of Common Stock over the ten consecutive Trading Day period ending on the
Business Day immediately preceding the Ex-Dividend Date relating to such distribution
for the issuance of such rights or warrants.

Such adjustment shall be successively made whenever any such rights, warrants or convertible
securities are issued and shall become effective immediately after 9:00 a.m., New York City time,
on the Business Day following the date fixed for such determination. If such rights, warrants or
convertible securities are not so issued, the Conversion Rate shall again be adjusted to be the
Conversion Rate that would then be in effect if such Record Date for such distribution had not been
fixed. To the extent that shares of Common Stock are not delivered after the expiration of such
rights, warrants or convertible securities, the Conversion Rate shall be readjusted to the
Conversion Rate that would then be in effect had the adjustments made upon the issuance of such
rights or warrants been made on the basis of delivery of only the number of shares of Common Stock
actually delivered.

In determining whether any rights, warrants or convertible securities entitle the holders to
subscribe for or purchase shares of Common Stock at less than such Last Reported Sale Price, and in
determining the aggregate offering price of 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 exercise or conversion thereof, the value of such consideration, if other than cash, to
be determined by the Board of Directors.

52

 

     (c) In case the Company shall, by dividend or otherwise, distribute to all or substantially
all holders of its Common Stock shares of any class of Capital Stock of the Company (other than
Common Stock as covered by Section 13.04(a)), evidences of its Indebtedness or other assets or
property of the Company (including securities, but excluding dividends and distributions covered by
Section 13.04(b) or Section 13.04(d) and distributions described below in this paragraph (c) with
respect to Spin-Offs) (any of such shares of Capital Stock, Indebtedness, or other asset or
property hereinafter in this Section 13.04(c) called the “Distributed Property”), then, in each
such case the Conversion Rate shall be adjusted based on the following formula:

	 	 	 	 	 	 	 
	 

	 	CR’= CR0 x
  	SP0	 	 
	 

	 	 

SP0 – FMV	 	 

where

	 	CR0	 = 	the Conversion Rate in effect immediately prior to the Ex-Dividend Date for
such distribution;
	 
	 	CR’	 = 	the Conversion Rate in effect immediately after the Ex-Dividend Date for such
distribution;
	 
	 	SP0	 = 	the average of the Last Reported Sale Prices of the Common Stock over the
ten consecutive Trading Day period ending on the Business Day immediately preceding the
Ex-Dividend Date relating to 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 or property distributed with
respect to each outstanding share of Common Stock on the Ex-Dividend Date relating to
such distribution.

Such adjustment shall become effective immediately prior to 4:00 a.m., New York City time, on the
Business Day following the date fixed for the determination of stockholders entitled to receive
such distribution; provided that if the then fair market value (as so determined) of the portion of
the Distributed Property so distributed applicable to one share of Common Stock is equal to or
greater than SP0 as set forth above, in lieu of the foregoing adjustment, adequate
provision shall be made so that each Noteholder shall have the right to receive, for each $1,000
principal amount of Notes upon conversion, the amount of Distributed Property such holder would
have received had such holder owned a number of shares of Common Stock equal to the Conversion Rate
on the Record Date. If such dividend or distribution is not so paid or made, the Conversion Rate
shall again be adjusted to be the Conversion Rate that would then be in effect if such dividend or
distribution had not been declared. If the Board of Directors determines the fair market value of
any distribution for purposes of this Section 13.04(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 determining SP0 above.

53

 

With respect to an adjustment pursuant to this Section 13.04(c) where there has been a payment of a
dividend or other distribution on the Common Stock or shares of Capital Stock of any class or
series, or similar equity interest, of or relating to a Subsidiary or other business unit (a
“Spin-Off”), the Conversion Rate in effect immediately before 5:00 p.m., New York City time, on the
Record Date fixed for determination of stockholders entitled to receive the distribution will be
increased based on the following formula:

	 	 	 	 	 	 	 
	 

	 	CR’= CR0 x
  	FMV0 + MP0
	 	 
	 

	 	 

MP0	 	 

where

	 	CR0	 = 	the Conversion Rate in effect immediately prior to such distribution;
	 
	 	CR’	 = 	the Conversion Rate in effect immediately after such distribution;
	 
	 	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 over the first ten consecutive Trading Day period after the effective
date of the Spin-Off; and
	 
	 	MP0	 = 	the average of the Last Reported Sale Prices of Common Stock over the first
ten consecutive Trading Day period after the effective date of the Spin-Off.

Such adjustment shall occur on the tenth Trading Day from, and including, the effective date of the
Spin-Off; provided that in respect of any conversion within the ten Trading Days following any
Spin-Off, references within this paragraph (c) to ten days shall be deemed replaced with such
lesser number of trading days as have elapsed between such Spin-Off and the conversion date in
determining the applicable Conversion Rate.

     Rights or warrants distributed by the Company to all holders of Common Stock, entitling the
holders thereof to subscribe for or purchase shares of the Company’s Capital Stock, including
Common Stock (either initially or under certain circumstances), which rights or warrants, until the
occurrence of a specified event or events (“Trigger Event”): (i) are deemed to be transferred with
such shares of Common Stock; (ii) are not exercisable; and (iii) are also issued in respect of
future issuances of Common Stock, shall be deemed not to have been distributed for purposes of this
Section 13.04 (and no adjustment to the Conversion Rate under this Section 13.04 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 13.04(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 record date with respect
to new rights or warrants with such rights (and a termination or expiration of the existing rights
or warrants without exercise by any of the holders thereof). In addition, in the event of any
distribution (or deemed distribution) of rights or warrants, or any Trigger Event or

54

 

other event (of 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 13.04 was made, (1) in the case of any such rights or warrants that shall
all have been redeemed or repurchased without exercise by any holders thereof, the Conversion Rate
shall be readjusted upon such final redemption or repurchase to give effect to such distribution or
Trigger Event, as the case may be, as though it were a cash distribution, equal to the per share
redemption or repurchase price received by a holder or holders of Common Stock with respect to such
rights or warrants (assuming such holder had retained such rights or warrants), made to all holders
of Common Stock as of the date of such redemption or repurchase, and (2) in the case of such rights
or warrants that 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 purposes of this Section 13.04(c), Section 13.04(a) and Section 13.04(b), any dividend or
distribution to which this Section 13.04(c) is applicable that also includes shares of Common Stock
to which Section 13.04(a) applies or rights or warrants to subscribe for or purchase shares of
Common Stock to which Section 13.04(a) or Section 13.04(b) applies (or both), shall be deemed
instead to be (1) a dividend or distribution of the evidences of Indebtedness, assets or shares of
capital stock other than such shares of Common Stock or rights or warrants to which Section
13.04(b) applies (and any Conversion Rate adjustment required by this Section 13.04(c) with respect
to such dividend or distribution shall then be made) immediately followed by (2) a dividend or
distribution of such shares of Common Stock or such rights or warrants (and any further Conversion
Rate adjustment required by Section 13.04(a) and Section 13.04(b) with respect to such dividend or
distribution shall then be made), except (A) the record date of such dividend or distribution shall
be substituted as “the Record Date” and “the date fixed for such determination” within the meaning
of Section 13.04(a) and Section 13.04(b) and (B) any shares of Common Stock included in such
dividend or distribution shall not be deemed “outstanding immediately prior to such event” within
the meaning of Section 13.04(a).

     (d) In case the Company shall pay a dividend or make a distribution consisting exclusively of
cash to all or substantially all holders of its Common Stock, the Conversion Rate shall be adjusted
based on the following formula:

	 	 	 	 	 	 	 
	 

	 	CR’=
CR0 x
  	SP0	 	 
	 

	 	 

SP0 – C	 	 

where

	 	CR0 	 = 	the Conversion Rate in effect immediately prior to the Ex-Dividend Date for
such distribution;
	 
	 	CR’	 = 	the Conversion Rate in effect immediately after the Ex-Dividend Date for such
distribution;
	 
	 	SP0	 = 	the Last Reported Sale Prices of the Common Stock on the Trading Day
immediately preceding the Ex-Dividend Date relating to such distribution; and

55

 

	 	C	 = 	the amount in cash per share the Company distributes to holders of Common
Stock.

Such adjustment shall become effective immediately after 5:00 p.m., New York City time, on the
Record Date for such dividend or distribution; provided that if the portion of the cash so
distributed applicable to one share of Common Stock is equal to or greater than SP0 as
above, in lieu of the foregoing adjustment, adequate provision shall be made so that each
Noteholder shall have the right to receive upon conversion of a Note (or any portion thereof) the
amount of cash such holder would have received had such holder owned a number of shares equal to
the Conversion Rate on the Record Date. If such dividend or distribution is not so paid or made,
the Conversion Rate shall again be adjusted to be the Conversion Rate that would then be in effect
if such dividend or distribution had not been declared.

     For the avoidance of doubt, for purposes of this Section 13.04(d), in the event of any
reclassification of the Common Stock, as a result of which the Notes become convertible into more
than one class of Common Stock, if an adjustment to the Conversion Rate is required pursuant to
this Section 13.04(d), references in this Section to one share of Common Stock or Last Reported
Sale Price of one share of Common Stock shall be deemed to refer to a unit or to the price of a
unit consisting of the number of shares of each class of Common Stock into which the Notes are then
convertible equal to the numbers of shares of such class issued in respect of one share of Common
Stock in such reclassification. The above provisions of this paragraph shall similarly apply to
successive reclassifications.

     (e) In case the Company or any of its Subsidiaries makes a payment in respect of a tender
offer or exchange offer for all or any portion of the 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 of the Common Stock on the Trading Day next succeeding the last date on which
tenders or exchanges may be made pursuant to such tender or exchange offer (as it may be amended),
the Conversion Rate shall be increased based on the following formula:

	 	 	 	 	 	 	 
	 

	 	CR’= CR0 x
  	AC + (SP’ x OS’)	 	 
	 

	 	 

OS0 x SP’	 	 

where

	 	CR0	 = 	the Conversion Rate in effect on the date such tender or exchange offer
expires;
	 
	 	CR’	 = 	the Conversion Rate in effect on the 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;

56

 

	 	OS’	 = 	the number of shares of Common Stock outstanding immediately after the date
such tender or exchange offer expires; and
	 
	 	SP’	 = 	the average of the Last Reported Sale Prices of Common Stock on the Trading
Day next succeeding the date such tender or exchange offer expires,

such adjustment to become effective immediately prior to the opening of business on the day
following the last date on which tenders or exchanges may be made pursuant to such tender or
exchange offer. If the Company is obligated to purchase shares pursuant to any such tender or
exchange offer, but the Company is permanently prevented by applicable law from effecting all or
any such purchases or all or any portion of such purchases are rescinded, the Conversion Rate shall
again be adjusted to be the Conversion Rate that would then be in effect if such tender or exchange
offer had not been made or had only been made in respect of the purchases that had been effected.
No adjustment to the Conversion Rate will be made if the application of the foregoing formulae
would result in a decrease in the Conversion Rate.

     (f) For purposes of this Section 13.04 the term “Record Date” shall mean, with respect to any
dividend, distribution or other transaction or event in which the holders of Common Stock have the
right to receive any cash, securities or other property or in which the Common Stock (or other
applicable security) is exchanged for or converted into any combination of cash, securities or
other property, the date fixed for determination of stockholders entitled to receive such cash,
securities or other property (whether such date is fixed by the Board of Directors or by statute,
contract or otherwise).

     (g) In addition to those required by clauses (a), (b), (c), (d), and (e) of this Section
13.04, and to the extent permitted by applicable law, the Company from time to time may increase
the Conversion Rate by any amount for a period of at least 20 calendar days if the Board of
Directors determines that such increase would be in the Company’s best interest. In addition, the
Company may also (but is not required to) increase the Conversion Rate to avoid or diminish any
income tax to holders of Common Stock or rights to purchase Common Stock in connection with any
dividend or distribution of shares (or rights to acquire shares) or similar event. Whenever the
Conversion Rate is increased pursuant to the preceding sentence, the Company shall mail to the
holder of each Note at his last address appearing on the Note register provided for in Section 2.06
a notice of the increase at least fifteen days prior to the date the increased Conversion Rate
takes effect, and such notice shall state the increased Conversion Rate and the period during which
it will be in effect.

     (h) All calculations and other determinations under this Article XIII shall be made by the
Company and shall be made to the nearest cent or to the nearest one-ten thousandth (1/10,000) of a
share, as the case may be. No adjustment shall be made for the Company’s issuance of Common Stock
or convertible or exchangeable securities or rights to purchase Common Stock or convertible or
exchangeable securities, other than as provided in this Section 13.04. No adjustment shall be made
to the Conversion Rate unless such adjustment would require a change of at least 1% in the
Conversion Rate then in effect at such time. The Company shall carry forward any adjustments that
are less than 1% of the Conversion Rate and make such carried forward adjustments, regardless of
whether the aggregate adjustment is less

57

 

than 1% within one year of the first such adjustment carried forward, upon a Fundamental
Change, or upon maturity.

     (i) Whenever the Conversion Rate is adjusted as herein provided, the Company shall promptly
file with the Trustee and any Conversion Agent other than the Trustee an Officers’ Certificate
setting forth the Conversion Rate after such adjustment and setting forth a brief statement of the
facts requiring such adjustment. The Trustee and Conversion Agent may conclusively rely on the
accuracy of the Conversion Rate adjustment provided by the Company. Unless and until a Responsible
Officer of the Trustee shall have received such Officers’ 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 the
holder of each Note at his last address appearing on the Note register provided for in Section 2.06
of this Indenture, within twenty (20) days of the effective date of such adjustment. Failure to
deliver such notice shall not affect the legality or validity of any such adjustment.

     (j) In any case in which this Section 13.04 provides that an adjustment shall become effective
immediately after (1) a record date or Record Date for an event, (2) the date fixed for the
determination of stockholders entitled to receive a dividend or distribution pursuant to Section
13.04(a), (3) a date fixed for the determination of stockholders entitled to receive rights or
warrants pursuant to Section 13.04(b), or (4) the last date on which tenders or exchanges may be
made pursuant to any tender or exchange offer pursuant to Section 13.04(e) (each an “Adjustment
Determination Date”), the Company may elect to defer until the occurrence of the applicable
Adjustment Event (as hereinafter defined) (x) issuing to the holder of any Note converted after
such Adjustment Determination Date and before the occurrence of such Adjustment Event, the
additional cash and, if applicable, shares of Common Stock or other securities issuable upon such
conversion by reason of the adjustment required by such Adjustment Event over and above the amounts
deliverable upon such conversion before giving effect to such adjustment and (y) paying to such
holder any amount in cash in lieu of any fraction pursuant to Section 13.04. For purposes of this
Section 13.04(j), the term “Adjustment Event” shall mean:

     (i) in any case referred to in clause (1) hereof, the occurrence of such event,

     (ii) in any case referred to in clause (2) hereof, the date any such dividend or
distribution is paid or made,

     (iii) in any case referred to in clause (3) hereof, the date of expiration of such
rights or warrants, and

     (iv) in any case referred to in clause (4) hereof, the date a sale or exchange of
Common Stock pursuant to such tender or exchange offer is consummated and becomes
irrevocable.

58

 

     (k) For purposes of this Section 13.04, the number of shares of Common Stock at any time
outstanding shall not include shares held in the treasury of the Company but shall include shares
issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock.

     (l) For the avoidance of doubt, if a holder converts Notes prior to the effective date of a
Fundamental Change, and the Fundamental Change does not occur, the holder will not be entitled to
an increased Conversion Rate in connection with such conversion.

          Section 13.05. Shares to Be Fully Paid.
The Company shall provide, free from preemptive
rights, out of its authorized but unissued shares or shares held in treasury, sufficient shares of
Common Stock to provide for conversion of the Notes from time to time as such Notes are presented
for conversion.

          Section 13.06. Effect of Reclassification, Consolidation, Merger or Sale.

     If any of the following events occur, namely (i) any reclassification or change of the
outstanding shares of Common Stock (other than a change in par value, or from par value to no par
value, or from no par value to par value, or as a result of a split, subdivision or combination),
(ii) any consolidation, merger or combination of the Company with another Person, or (iii) any sale
or conveyance of all or substantially all of the property and assets of the Company to any other
Person, in either case as a result of which holders of Common Stock shall be entitled to receive
cash, securities or other property or assets with respect to or in exchange for such Common Stock
(any such event a “Merger Event”), then:

     (a) 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 if such supplemental indenture is then
required to so comply) permitted under Section 9.01(a) providing for the conversion and settlement
of the Notes as set forth in this Indenture. 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 and the Trustee may conclusively rely on the determination by the Company of
the equivalency of such adjustments. If, in the case of any Merger Event, the Reference Property
includes shares of stock or other securities and assets of a corporation other than the successor
or purchasing corporation, as the case may be, in such reclassification, change, consolidation,
merger, combination, sale or conveyance, then such supplemental indenture shall also be executed by
such other corporation and shall contain such additional provisions to protect the interests of the
holders of the Notes as the Board of Directors shall reasonably consider necessary by reason of the
foregoing, including to the extent required by the Board of Directors and practicable the
provisions providing for the repurchase rights set forth in Article XIV herein.

     In the event the Company shall execute a supplemental indenture pursuant to this Section
13.06, the Company shall promptly file with the Trustee an Officers’ Certificate briefly stating
the reasons therefore, the kind or amount of cash, securities or property or asset that will
constitute the Reference Property after any such Merger Event, any adjustment to be made with

59

 

respect thereto and that all conditions precedent have been complied with, and shall promptly mail
notice thereof to all Noteholders.

     (b) Notwithstanding the provisions of Section 13.02(a) and Section 13.02(b), and subject to
the provisions of Section 13.01, at the effective time of such Merger Event, the right to convert
each $1,000 principal amount of Notes will be changed to a right to convert such Note by reference
to the kind and amount of cash, securities or other property or assets that a holder of a number of
shares of Common Stock equal to the Conversion Rate immediately prior to such transaction would
have owned or been entitled to receive (the “Reference Property”) such that from and after the
effective time of such transaction, a Noteholder will be entitled thereafter to convert its Notes
into cash (up to the aggregate principal amount thereof) and the same type (and in the same
proportion) of Reference Property, based on the Daily Settlement Amounts of Reference Property in
an amount equal to the applicable Conversion Rate, as described under Section 13.02(b). For
purposes of determining the constitution of Reference Property, the type and amount of
consideration that a holder of Common Stock would have been entitled to in the case of
reclassifications, consolidations, mergers, sales or conveyance of assets or other transactions
that cause the Common Stock to be converted into the right to receive more than a single type of
consideration (determined based in part upon any form of stockholder election) 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
transaction unless its terms are consistent with the preceding. None of the foregoing provisions
shall affect the right of a holder of Notes to convert its Notes in accordance with the provisions
of Article XIII hereof prior to the effective date.

     (c) The Company shall cause notice of the execution of such supplemental indenture to be
mailed to each Noteholder, at his address appearing on the Note register provided for in this
Indenture, within twenty (20) days after execution thereof Failure to deliver such notice shall not
affect the legality or validity of such supplemental indenture.

     (d) The above provisions of this Section shall similarly apply to successive Merger Events.

          Section 13.07. Certain Covenants.

     (a) Before taking any action which would cause an adjustment reducing the Conversion Rate
below the then par value, if any, of the shares of Common Stock issuable upon conversion of the
Notes, the Company will take all corporate action which may, in the opinion of its counsel, be
necessary in order that the Company may validly and legally issue shares of such Common Stock at
such adjusted Conversion Rate.

     The Company covenants that all shares of Common Stock issued upon conversion of Notes will be
fully paid and non-assessable by the Company and free from all taxes, liens and changes with
respect to the issue thereof.

     (b) The Company covenants that, if any shares of Common Stock to be provided for the purpose
of conversion of Notes hereunder require registration with or approval of any governmental
authority under any federal or state law before such shares may be validly issued

60

 

upon conversion,
the Company will in good faith and as expeditiously as possible, to the extent then permitted by
the rules and interpretations of the Commission (or any successor thereto), endeavor to secure such
registration or approval, as the case may be.

     (c) The Company further covenants that if at any time the Common Stock shall be listed on any
other national securities exchange or automated quotation system the Company will, if permitted and
required by the rules of such exchange or automated quotation system, list and keep listed, so long
as the Common Stock shall be so listed on such exchange or automated quotation system, all Common
Stock issuable upon conversion of the Notes.

          Section 13.08. Responsibility of Trustee.
Notwithstanding any provision of this Indenture to the contrary, the Trustee and any other Conversion Agent shall
not at any time be under any duty or responsibility to any Noteholder to determine the Conversion
Rate or whether any facts exist which may require any adjustment of the Conversion Rate, or with
respect to the nature or extent or calculation of any such adjustment when made, or with respect to
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 securities or
property, which may at any time be issued or delivered upon the conversion of any Note; and the
Trustee and any other 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 Note for the purpose of conversion or to comply with any
of the duties, responsibilities or covenants of the Company contained in this Article.

     Without limiting the generality of the foregoing, neither the Trustee nor any Conversion Agent
shall be under any responsibility to determine the correctness of any provisions contained in any
supplemental indenture entered into pursuant to Section 13.06 relating either to the kind or amount
of shares of stock or securities or property (including cash) receivable by Noteholders upon the
conversion of their Notes after any event referred to in such Section 13.06 or to any adjustment to
be made with respect thereto, but, subject to the provisions of Section 6.01, may accept as
conclusive evidence of the correctness of any such provisions, and shall be protected in relying
upon, the Officers’ Certificate (which the Company shall be obligated to file with the Trustee
prior to the execution of any such supplemental indenture) with respect thereto.

          Section 13.09. 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 13.04; or

     (b) the Company shall authorize the granting to all of the holders of its Common Stock of
rights or warrants to subscribe for or purchase any share of any class or any other rights or
warrants, or

     (c) of any reclassification 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 

61

 

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 shareholders of the Company is required, or of the sale or
transfer of all or substantially all of the assets of the Company; or

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

the Company shall cause to be filed with the Trustee and to be mailed to each Noteholder at his
address appearing on the Note register, provided for in Section 2.06 of this Indenture, as promptly
as possible but in any event at least twenty days prior to the applicable date specified in clause
(x) or (y) below, as the case may be, a notice stating (x) the date on which a record is to be
taken for the purpose of such dividend, 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 are to be determined, or (y) the date on which such
reclassification, consolidation, merger, sale, 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, 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, distribution, reclassification,
consolidation, merger, sale, transfer, dissolution, liquidation or winding-up.

          Section 13.10. Shareholder Rights Plans.
Upon conversion of the Notes, the holders shall
receive, in addition to any shares of Common Stock issuable upon such conversion, the associated
rights issued under the Rights Plan or under any future shareholder rights plan the Company adopts
unless, prior to conversion, the rights have separated from the Common Stock, expired, terminated
or been redeemed or exchanged in accordance with the Rights Plan. If, and only if, the holders
receive rights under such shareholder rights plans as described in the preceding sentence upon
conversion of their Notes, then no other adjustment pursuant to this Article XIII shall be made in
connection with such shareholder rights plans.

ARTICLE XIV

REPURCHASE OF NOTES AT OPTION OF HOLDERS

          Section 14.01. Repurchase at Option of Holders Upon a Designated Event.

     (a) If a Designated Event occurs at any time, then each Noteholder shall have the right, at
such holder’s option, to require the Company to repurchase all of such holder’s Notes or
any portion thereof that is a multiple of $1,000 principal amount, for cash on the date (the
“Designated Event Repurchase Date”) specified by the Company that is not less than twenty (20) days
and not more than thirty five (35) calendar days after the date of the Fundamental Change Company
Notice (as defined below) at a repurchase price equal to 100% of the principal amount thereof,
together with accrued and unpaid interest thereon to, but excluding, the Designated Event
Repurchase Date (unless the Designated Event Repurchase Date is between a regular Record Date and
the corresponding Interest Payment Date) (the “Designated Event Repurchase Price”).

62

 

     Repurchases of Notes under this Section 14.01 shall be made, at the option of the holder
thereof, upon:

     (i) delivery to the Trustee (or other Paying Agent appointed by the Company) by a
holder of a duly completed notice (the “Designated Event Repurchase Notice”) in the form set
forth on the reverse of the Note prior to the close of business on the third Business Day immediately preceding the Designated Event
Repurchase Date; and

     (ii) delivery or book-entry transfer of the Notes to the Trustee (or other Paying Agent
appointed by the Company) at any time after delivery of the Designated Event Repurchase
Notice (together with all necessary endorsements) at the Corporate Trust Office of the
Trustee (or other Paying Agent appointed by the Company) in the Borough of Manhattan, such
delivery being a condition to receipt by the holder of the Designated Event Repurchase Price
therefor; provided that such Designated Event Repurchase Price shall be so paid pursuant to
this Section 14.01 only if the Note so delivered to the Trustee (or other Paying Agent
appointed by the Company) shall conform in all respects to the description thereof in the
related Designated Event Repurchase Notice.

     The Designated Event Repurchase Notice shall state:

     (A) if certificated, the certificate numbers of Notes to be delivered for
repurchase;

     (B) the portion of the principal amount of Notes to be repurchased, which must
be $1,000 or an integral multiple thereof, and

     (C) that the Notes are to be repurchased by the Company pursuant to the
applicable provisions of the Notes and the Indenture.

     Any purchase by the Company contemplated pursuant to the provisions of this Section 14.01
shall be consummated by the delivery of the consideration to be received by the holder promptly
following the later of the Designated Event Repurchase Date and the time of the book-entry transfer
or delivery of the Note.

     The Trustee (or other Paying Agent appointed by the Company) shall promptly notify the Company
of the receipt by it of any Fundamental Change Repurchase Notice or written notice of withdrawal
thereof in accordance with the provisions of Section 14.01(c).

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

63

 

     (b) On or before the tenth day after the Effective Date of any Designated Event, the Company
shall provide to all holders of record of the Notes and the Trustee and Paying Agent a notice (the
“Designated Event Company Notice”) of the occurrence of such Designated Event and of the repurchase
right at the option of the holders arising as a result thereof. Such mailing shall be by first
class mail. Simultaneously with providing such Designated Event Company Notice, the Company shall
publish a notice containing the information included therein on the Company’s website or through
such other public medium as the Company may use at such time.

     Each Designated Event Company Notice shall specify:

     (i) the events causing the Designated Event and whether such Designated Event also
constituted a Fundamental Change;

     (ii) the date of the Designated Event;

     (iii) the Designated Event Repurchase Date and the last date on which a holder may
exercise the repurchase right;

     (iv) the Designated Event Repurchase Price;

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

     (vi) the applicable Conversion Rate and any adjustments to the applicable Conversion
Rate;

     (vii) that the Notes with respect to which a Designated Event Repurchase Notice has
been delivered by a holder may be converted only if the holder withdraws the Designated
Event Repurchase Notice in accordance with the terms of the indenture;

     (viii) that the holder must exercise the repurchase right on or prior to the close of
business on the third Business Day immediately preceding the Designated Event Repurchase Date (the “Designated Event Expiration Time”);

     (ix) that the holder shall have the right to withdraw any Notes surrendered prior to
the Designated Event Expiration Time, and

     (x) the procedures that holders must follow to require the Company to repurchase their
Notes.

     No failure of the Company to give the foregoing notices and no defect therein shall limit the
Noteholders’ repurchase rights or affect the validity of the proceedings for the repurchase of the
Notes pursuant to this Section 14.02.

     (c) A Designated Event Repurchase Notice may be withdrawn by means of a written notice of
withdrawal delivered to the Paying Agent in accordance with the Designated Event Company Notice at
any time prior to the close of business on the Business Day prior to the Designated Event
Repurchase Date, specifying:

64

 

     (i) if certificated Notes have been issued, the certificate numbers of the withdrawn
Notes,

     (ii) the principal amount of the Note with respect to which such notice of withdrawal
is being submitted, and

     (iii) the principal amount, if any, of such Note that remains subject to the original
Designated Event Repurchase Notice, which portion must be in principal amounts of $1,000 or
an integral multiple of $1,000;

provided, however, that if the Notes are not in certificated form, the notice must comply with
appropriate procedures of the Depositary.

     (d) On or prior to 11:00 a.m. (local time in The City of New York) on the Business Day
following the Designated Event Repurchase Date, the Company will deposit with the Trustee (or other
Paying Agent appointed by the Company or if the Company is acting as its own Paying Agent, set
aside, segregate and hold in trust as provided in Section 5.04) an amount of money sufficient to
repurchase on the Designated Event Repurchase Date all of the Notes to be repurchased on such date
at the Designated Event Repurchase Price. Subject to receipt of funds and/or Notes by the Trustee
(or other Paying Agent appointed by the Company), payment for Notes surrendered for repurchase (and
not withdrawn) prior to the Designated Event Expiration Time will be made promptly after the later
of (x) the Designated Event Repurchase Date with respect to such Note (provided the holder has
satisfied the conditions to the payment of the Designated Event Repurchase Price in Section 14.02),
and (y) the time of book-entry transfer or the delivery of such Note to the Trustee (or other
Paying Agent appointed by the Company) by the holder thereof in the manner required by Section
14.01 by mailing checks for the amount payable to the holders of such Notes entitled thereto as
they shall appear in the Note register, provided, however, that payments to the Depositary shall be
made by wire transfer of immediately available funds to the account of the Depositary or its
nominee. The Trustee shall, promptly after such payment and upon written demand by the Company,
return to the Company any funds in excess of the Designated Event Repurchase Price.

     (e) If the Trustee (or other Paying Agent appointed by the Company) holds money or securities
sufficient to repurchase on the Designated Event Repurchase Date all the Notes or portions thereof
that are to be purchased as of the Business Day following the Designated Event Repurchase Date,
then on and after the Designated Event Repurchase Date (i) such Notes will cease to be outstanding,
(ii) interest will cease to accrue on such Notes, and (iii) all other rights of the holders of such
Notes will terminate, whether or not book-entry transfer of the Notes has
been made or the Notes have been delivered to the Trustee or Paying Agent, other than the
right to receive the Designated Event Repurchase Price upon delivery of the Notes.

65

 

ARTICLE XV

MISCELLANEOUS PROVISIONS

          Section 15.01. Provisions Binding on Company’s Successors.
All the covenants, stipulations,
promises and agreements of the Company contained in this Indenture shall bind its successors and
assigns whether so expressed or not.

          Section 15.02. Official Acts by Successor Corporation.
Any act or proceeding by any
provision of this Indenture authorized or required to be done or performed by any board, committee
or officer of the Company shall and may be done and performed with like force and effect by the
like board, committee or officer of any corporation that shall at the time be the lawful sole
successor of the Company.

          Section 15.03. Addresses for Notices, Etc.
Any notice or demand which by any provision of
this Indenture is required or permitted to be given or served by the Trustee or by the Noteholders
on the Company shall be deemed to have been sufficiently given or made, for all purposes if given
or served by being deposited postage prepaid by registered or certified mail in a post office
letter box addressed (until another address is filed by the Company with the Trustee) to SanDisk
Corporation, 140 Caspian Court, Sunnyvale, California 94089, Attention: General Counsel. Any
notice, direction, request or demand hereunder to or upon the Trustee shall be deemed to have been
sufficiently given or made, for all purposes, if given or served by being deposited postage prepaid
by registered or certified mail in a post office letter box addressed to the Corporate Trust
Office.

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

     Any notice or communication mailed to a Noteholder shall be mailed to him by first class mail,
postage prepaid, at his address as it appears on the Note register and shall be sufficiently given
to him if so mailed within the time prescribed.

     Failure to mail a notice or communication to a Noteholder or any defect in it shall not affect
its sufficiency with respect to other Noteholders. If a notice or communication is mailed in the
manner provided above, it is duly given, whether or not the addressee receives it.

          Section 15.04. Governing Law.
THIS INDENTURE AND EACH NOTE SHALL BE DEEMED TO BE A CONTRACT
MADE UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO CONTRACTS ENTERED INTO AND TO BE PERFORMED THEREIN

          Section 15.05. Evidence of Compliance with Conditions Precedent; Certificates and Opinions
of Counsel to Trustee.
Upon any application or demand by the Company to the Trustee to take any
action under any of the provisions of this Indenture, the Company shall furnish to the Trustee an
Officers’ Certificate stating that all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with, and an

66

 

Opinion of Counsel stating that, in
the opinion of such counsel, all such conditions precedent have been complied with.

     Each certificate or opinion provided for by or on behalf of the Company in this Indenture and
delivered to the Trustee with respect to compliance with a condition or covenant provided for in
this Indenture shall include (1) a statement that the person making such certificate or opinion has
read such covenant or condition; (2) a brief statement as to the nature and scope of the
examination or investigation upon which the statement or opinion contained in such certificate or
opinion is based; (3) a statement that, in the opinion of such person, he has made such examination
or investigation as is necessary to enable him to express an informed opinion as to whether or not
such covenant or condition has been complied with; and (4) a statement as to whether or not, in the
opinion of such person, such condition or covenant has been complied with.

          Section 15.06. Legal Holidays.
In any case where any Interest Payment Date, Designated Event
Purchase Date, Conversion Date or Maturity Date will not be a Business Day, then any action to be
taken on such date need not be taken on such date, but may be taken on the next succeeding Business
Day with the same force and effect as if taken on such date, and no interest shall accrue for the
period from and after such date to the next succeeding Business Day.

          Section 15.07. No Security Interest Created.
Nothing in this Indenture or in the Notes,
expressed or implied, shall be construed to constitute a security interest under the Uniform
Commercial Code or similar 1egislation, as now or hereafter enacted and in effect, in any
jurisdiction.

          Section 15.08. Benefits of Indenture.
Nothing in this Indenture or in the Notes, expressed
or implied, shall give to any person, other than the parties hereto, any Paying Agent, any
authenticating agent, any Note Registrar and their successors hereunder, the Noteholders, any
benefit or any legal or equitable right, remedy or claim under this Indenture.

          Section 15.09. Table of Contents, Headings, Etc.
The table of contents and the titles and headings of the articles and sections of this
Indenture have been inserted for convenience of reference only, are not to be considered a part
hereof, and shall in no way modify or restrict any of the terms or provisions hereof.

          Section 15.10. Authenticating Agent.
The Trustee may appoint an authenticating agent which
shall be authorized to act on its behalf and subject to its direction in the authentication and
delivery of Notes in connection with the original issuance thereof and transfers and exchanges of
Notes hereunder, including under Section 2.05, Section 2.06, Section 2.07 and Section 2.08, as
fully to all intents and purposes as though the authenticating agent had been expressly authorized
by this Indenture and those Sections to authenticate and deliver Notes. For all purposes of this
Indenture, the authentication and delivery of Notes by the authenticating agent shall be deemed to
be authentication and delivery of such Notes “by the Trustee” and a certificate of authentication
executed on behalf of the Trustee by an authenticating agent shall be deemed to satisfy any
requirement hereunder or in the Notes for the Trustee’s certificate of authentication. Such
authenticating agent shall at all times be a person eligible to serve as trustee hereunder pursuant
to Section 6.09.

67

 

     Any corporation into which any authenticating agent may be merged or converted or with which
it may be consolidated, or any corporation resulting from any merger, consolidation or conversion
to which any authenticating agent shall be a party, or any corporation succeeding to the corporate
trust business of any authenticating agent, shall be the successor of the authenticating agent
hereunder, if such successor corporation is otherwise eligible under this Section, without the
execution or filing of any paper or any further act on the part of the parties hereto or the
authenticating agent or such successor corporation.

     Any authenticating agent may at any time resign by giving written notice of resignation to the
Trustee and to the Company. The Trustee may at any time terminate the agency of any authenticating
agent by giving written notice of termination to such authenticating agent and to the Company.
Upon receiving such a notice of resignation or upon such a termination, or in case at any time any
authenticating agent shall cease to be eligible under this Section, the Trustee shall promptly
appoint a successor authenticating agent (which may be the Trustee), shall give written notice of
such appointment to the Company and shall mail notice of such appointment to all Noteholders as the
names and addresses of such holders appear on the Note register.

     The Company agrees to pay to the authenticating agent from time to time reasonable
compensation for its services although the Company may terminate the authenticating agent, if it
determines such agent’s fees to be unreasonable.

     The provisions of Section 6.02, Section 6.03, Section 6.04, Section 7.03 and this Section
15.11 shall be applicable to any authenticating agent.

          Section 15.11. Execution in Counterparts.
This Indenture may be executed in any number of
counterparts, each of which shall be an original, but such counterparts shall together constitute
but one and the same instrument.

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

	 	 	 	 	 
	 	 	SANDISK CORPORATION
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 
	 
	 	 	 	 
	 	 	THE BANK OF NEW YORK
	 	 	as Trustee
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 

69

 

SCHEDULE A

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 		 	 	 	 	 	 	 	 	 	 
	Stock Price
	Effective	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	   Date	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 
	 
	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 
	 
	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 
	 
	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 
	 
	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 
	 
	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 
	 
	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 
	 
	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 
	 
	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 	 	 	•	 

 

 

EXHIBIT A

[FORM OF FACE OF NOTE]

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

A-1

 

SANDISK CORPORATION

[                    ]% Convertible Senior Notes due 2013

			
	No.                     
	 	$                    

CUSIP No.                    

     SanDisk Corporation, a corporation duly organized and validly existing under the laws of the
State of Delaware (herein called the “Company,” which term includes any successor corporation under
the Indenture referred to on the reverse hereof), for value received hereby promises to pay to
[CEDE & CO.], or registered assigns, the principal sum of [                ] Dollars or such other
principal amount as shall be set forth on the Schedule I hereto on May [___], 2013.

     This Note shall bear interest at the rate of [•]% per year from May [___], 2006, or from the
most recent date to which interest had been paid or provided. Interest is payable semi-annually in
arrears on each May 15 and November 15, commencing November 15, 2006, to holders of record at the
close of business on the preceding May 1 and November 1, respectively. Interest payable on each
Interest Payment Date shall equal the amount of interest accrued from and including the immediately
preceding Interest Payment Date (or from and including May [___], 2006 if no interest has been paid
hereon) to but excluding such Interest Payment Date.

     Payment of the principal of and interest accrued on this Note shall be made at the office or
agency off the Company maintained for that purpose in the Borough of Manhattan, The City of New
York, or, at the option of the holder of this Note, at the Corporate Trust Office, in such lawful
money of the United States of America as at the time of payment shall be legal tender for the
payment of public and private debts; provided, however, interest may be paid by check mailed to
such holder’s address as it appears in the Note register; provided, further, however, that, with
respect to any Noteholder with an aggregate principal amount in excess of $1,000,000, at the
application of such holder in writing to the Company, interest on such holder’s Notes shall be paid
by wire transfer in immediately available funds to such holder’s account in the United States
supplied by such holder from time to time to the Trustee and Paying Agent (if different from the
Trustee) not later than the applicable record date; provided that any payment to the Depositary or
its nominee shall be paid by wire transfer in immediately available funds in accordance with the
wire transfer instruction supplied by the Depositary or its nominee from time to time to the
Trustee and Paying Agent (if different from Trustee).

     Reference is made to the further provisions of this Note set forth on the reverse hereof,
including, without limitation, provisions giving the holder of this Note the right to convert this
Note into cash and Common Stock, if any, of the Company on the terms and subject to the limitations
referred to on the reverse hereof and as more fully specified in the Indenture. Such further
provisions shall for all purposes have the same effect as though fully set forth at this place.

     This Note shall be deemed to be a contract made under the laws of the State of New York, and
for all purposes shall be construed in accordance with the laws of the State of New York applicable
to contracts entered into and to be performed therein.

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

[Remainder of page intentionally left blank]

A-3

 

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

	 	 	 	 	 	 	 
	 	 	SANDISK CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 

A-4

 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

THE BANK OF NEW YORK,

as Trustee, certifies that this is one of the Notes described

in the within-named Indenture.

	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Authorized Officer	 	 

A-5

 

[FORM OF REVERSE OF NOTE]

SANDISK CORPORATION

[•]% Convertible Senior Notes due 2013

     This Note is one of a duly authorized issue of Notes of the Company, designated as its [•]%
Convertible Senior Notes due 2013 (herein called the “Notes”), issued under and pursuant to an
Indenture dated as of May [___], 2006 (herein called the “Indenture”), between the Company and The
Bank of New York (herein called the “Trustee”), to which Indenture and all
indentures supplemental thereto reference is hereby made for a description of the rights,
limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company
and the holders of the Notes. Additional Notes may be issued in an unlimited aggregate principal
amount, subject to certain conditions specified in the Indenture.

     In case an Event of Default, as defined in the Indenture, shall have occurred and be
continuing, the principal of, and accrued and unpaid interest on, all Notes, may be declared, and
upon said declaration shall become, due and payable, in the manner, with the effect and subject to
the conditions provided in the Indenture.

     Subject to the terms and conditions of the Indenture, the Company will make all payments and
deliveries in respect of the Designated Event Repurchase Price and the principal amount on the
Maturity Date, as the case may be, to the holder who surrenders a Note to a Paying Agent to collect
such payments in respect of the Note. The Company will pay cash amounts in money of the United
States that at the time of payment is legal tender for payment of public and private debts.

     The Indenture contains provisions permitting the Company and the Trustee in certain
circumstances, without the consent of the holders of the Notes, and in other circumstances, with
the consent of the holders of not less than a majority in aggregate principal amount of the Notes
at the time outstanding, evidenced as in the Indenture provided, to execute supplemental indentures
adding any provisions to or changing in any manner or eliminating any of the provisions of the
Indenture or of any supplemental indenture or modifying in any manner the rights of the holders of
the Notes; provided, however, that no such supplemental indenture shall make any of the changes set
forth in Section 9.02 of the Indenture, without the consent of each holder of an outstanding Note
affected thereby. It is also provided in the Indenture that, prior to any declaration accelerating
the maturity of the Notes, the holders of a majority in aggregate principal amount of the Notes at
the time outstanding may on behalf of the holders of all of the Notes waive any past default or
Event of Default under the Indenture and its consequences except as provided in the Indenture. Any
such consent or waiver by the holder of this Note (unless revoked as provided in the Indenture)
shall be conclusive and binding upon such holder and upon all future holders and owners of this
Note and any Notes which may be issued in exchange or substitution hereof, irrespective of whether
or not any notation thereof is made upon this Note or such other Notes.

     No reference herein to the Indenture and no provision of this Note or of the Indenture shall
alter or impair the obligation of the Company, which is absolute and unconditional, to pay

A-6

 

the principal of, and accrued and unpaid interest on, this Note, at the place, at the
respective times, at the rate and in the lawful money herein prescribed.

     The Notes are issuable in registered form without coupons in denominations of $1,000 principal
amount and integral multiples thereof. At the office or agency of the Company referred to on the
face hereof, and in the manner and subject to the limitations provided in the Indenture, without
payment of any service charge but with payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration or exchange of Notes,
Notes may be exchanged for a like aggregate principal amount of Notes of other authorized
denominations.

     The Notes are not subject to redemption through the operation of any sinking fund.

     Upon the occurrence of a Designated Event, the holder has the right, at such holder’s option,
to require the Company to repurchase all of such holder’s Notes or any portion thereof (in
principal amounts of $1,000 or integral multiples thereof) on the Designated Event Repurchase Date
at a price equal to 100% of the principal amount of the Notes such holder elects to require the
Company to repurchase, together with accrued and unpaid interest to but excluding the Designated
Event Repurchase Date. The Company or, at the written request of the Company, the Trustee shall
mail to all holders of record of the Notes a notice of the occurrence of a Designated Event and of
the repurchase right arising as a result thereof on or before the twentieth day after the
occurrence of any Designated Event.

     Subject to the provisions of the Indenture, the holder hereof has the right, at its option, on
and after February [___], 2013, or earlier upon the occurrence of certain conditions specified in
the Indenture and prior to the close of business on the Trading Day immediately preceding the
Maturity Date, to convert any Notes or portion thereof which is $1,000 or an integral multiple
thereof, into cash and, if applicable, shares of Common Stock, in each case at the Conversion Rate
specified in the Indenture, as adjusted from time to time as provided in the Indenture, upon
surrender of this Note, together with a Notice of Conversion, a form of which is attached to the
Note, as provided in the Indenture and this Note, to the Company at the office or agency of the
Company maintained for that purpose in the Borough of Manhattan, The City of New York, or at the
option of such holder, the Corporate Trust Office, and, unless the shares issuable on conversion
are to be issued in the same name as this Note, duly endorsed by, or accompanied by instruments of
transfer in form satisfactory to the Company duly executed by, the holder or by his duly authorized
attorney. The initial Conversion Rate shall be [•] shares for each $1,000 principal amount of
Notes. No fractional shares of Common Stock will be issued upon any conversion, but an adjustment
in cash will be paid to the holder, as provided in the Indenture, in respect of any fraction of a
share which would otherwise be issuable upon the surrender of any Note or Notes for conversion. No
adjustment shall be made for dividends or any shares issued upon conversion of such Note except as
provided in the Indenture.

     Upon due presentment for registration of transfer of this Note at the office or agency of the
Company in the Borough of Manhattan, The City of New York, a new Note or Notes of authorized
denominations for an equal aggregate principal amount will be issued to the transferee in exchange
thereof, subject to the limitations provided in the Indenture, without

A-7

 

charge except for any tax, assessments or other governmental charge imposed in connection
therewith.

     The Company, the Trustee, any authenticating agent, any Paying Agent, any Conversion Agent and
any Note Registrar may deem and treat the registered holder hereof as the absolute owner of this
Note (whether or not this Note shall be overdue and notwithstanding any notation of ownership or
other writing hereon), for the purpose of receiving payment hereof, or on account hereof, for the
conversion hereof and for all other purposes, and neither the Company nor the Trustee nor any other
authenticating agent nor any Paying Agent nor any other Conversion Agent nor any Note Registrar
shall be affected by any notice to the contrary. All payments made to or upon the order of such
registered holder shall, to the extent of the sum or sums paid, satisfy and discharge liability for
monies payable on this Note.

     No recourse for the payment of the principal of, or accrued and unpaid interest on, this Note,
or for any claim based hereon or otherwise in respect hereof, and no recourse under or upon any
obligation, covenant or agreement of the Company in the Indenture or any indenture supplemental
thereto or in any Note, or because of the creation of any Indebtedness represented thereby, shall
be had against any incorporator, stockholder, employee, agent, officer, director or subsidiary, as
such, past, present or future, of the Company or of any successor corporation, either directly or
through the Company or any successor corporation, whether by virtue of any constitution, statute or
rule of law or by the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the issue hereof, expressly
waived and released.

     Terms used in this Note and defined in the Indenture are used herein as therein defined.

     Customary abbreviations may be used in the name of a Holder or an assignee, such as TEN COM
(=tenants in common), TENANT (=tenants by the entireties), JT TEN (joint tenants with right of
survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform gift to Minors
Act).

A-8

 

[FORM OF CONVERSION NOTICE]

To: SANDISK CORPORATION

     The undersigned registered owner of this Note hereby exercises the option to convert this
Note, or the portion hereof (which is $1,000 principal amount or an integral multiple thereof)
below designated, into cash and shares of Common Stock, if any, in accordance with the terms of the
Indenture referred to in this Note, and directs that the cash and shares, if any, issuable and
deliverable upon such conversion, together with any Notes representing any unconverted principal
amount hereof, be issued and delivered to the registered holder hereof unless a different name has
been indicated below. If shares or any portion of this Note not converted are to be issued in the
name of a person other than the undersigned, the undersigned will pay all transfer taxes payable
with respect thereto. Any amount required to be paid to the undersigned on account of interest
accompanies this Note.

Dated:                                        

	 	 	 	 	 
	 

	 	 

Signature(s)
	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	 

Signature Guarantee
	 	 

Signature(s) must be guaranteed by an eligible

Guarantor Institution (banks, stock brokers, savings

and loan associations and credit unions)

with membership in an approved signature guarantee

medallion program pursuant to Rule 17Ad-15 under

the Securities Exchange Act of 1934, as amended, if

shares of Common Stock are to be issued, or Notes

to be delivered, other than to and in the name of the

registered holder.

A-9

 

Fill in for registration of shares if

to be issued, and Notes if to

be delivered, other than to and in the

name of the registered holder:

	 	 	 
	 

(Name)

	 	 
	 
	 	 
	 

(Street Address)

	 	 
	 
	 	 
	 

(City, State and Zip Code)

	 	 
	Please print name and address
	 	 

	 	 	 	 	 
	 

	 	Principal amount to be converted	 	 
	 

	 	(if less than all): $___,000	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	 

	 	Social Security or Other Taxpayer	 	 
	 

	 	Identification Number	 	 

A-10

 

[FORM OF DESIGNATED EVENT REPURCHASE NOTICE]

To: SanDisk Corporation

     The undersigned registered owner of this Note hereby acknowledges receipt of a notice from
SanDisk Corporation (the “Company”) as to the occurrence of a Designated Event with respect to the
Company and requests and instructs the Company to repay the entire principal amount of this Note,
or the portion thereof (which is $1,000 principal amount or an integral multiple thereof) below
designated, in accordance with the terms of the Indenture referred to in this Note, to the
registered holder hereof.

Dated:                                        

	 	 	 	 	 
	 

	 	 

Signature(s)
	 	 
	 
	 	 	 	 
	 

	 	 

	 	 

	 	 	 
	 

	 	Social Security or Other Taxpayer Identification
Number Principal amount to be repaid (if less than
all): $_,000

NOTICE: The above signatures of the holder(s) hereof
must correspond with the name as written upon the
face of the Note in every particular without
alteration or enlargement or any change whatever.

A-11

 

Schedule l

SANDISK CORPORATION

[•]% Convertible Senior Notes Due 2013

No.                    

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Notation Explaining	 	 	Authorized	 
	 	 	 	 	 	 	Principal Amount	 	 	Signature of Trustee	 
	Date	 	Principal Amount	 	 	Recorded	 	 	or Custodian

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