Document:

exv4w1

 

Exhibit 4.1

VERIFONE HOLDINGS, INC.

1.375% Senior Convertible Notes due 2012

INDENTURE

Dated as of June 22, 2007

U.S. BANK NATIONAL ASSOCIATION, Trustee

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE
	 	 	1	 
	 
	 	 	 	 
	SECTION 1.01 Definitions
	 	 	1	 
	SECTION 1.02 Incorporation by Reference of Trust Indenture Act
	 	 	11	 
	SECTION 1.03 Rules of Construction
	 	 	11	 
	 
	 	 	 	 
	ARTICLE 2 THE NOTES
	 	 	11	 
	 
	 	 	 	 
	SECTION 2.01 Designation, Amount and Issuance of Notes
	 	 	11	 
	SECTION 2.02 Form of the Notes
	 	 	11	 
	SECTION 2.03 Date and Denomination of Notes; Payment at Maturity; Payment of Interest
	 	 	12	 
	SECTION 2.04 Execution and Authentication
	 	 	14	 
	SECTION 2.05 Registrar, Paying Agent and Conversion Agent
	 	 	14	 
	SECTION 2.06 Paying Agent to Hold Money in Trust
	 	 	15	 
	SECTION 2.07 Noteholder Lists
	 	 	15	 
	SECTION 2.08 Exchange and Registration of Transfer of Notes; Restrictions on Transfer
	 	 	15	 
	SECTION 2.09 Replacement Notes
	 	 	21	 
	SECTION 2.10 Outstanding Notes
	 	 	21	 
	SECTION 2.11 Temporary Notes
	 	 	22	 
	SECTION 2.12 Cancellation
	 	 	22	 
	SECTION 2.13 CUSIP and ISIN Numbers
	 	 	22	 
	SECTION 2.14 Additional Notes
	 	 	22	 
	SECTION 2.15 Share Cap Additional Interest
	 	 	23	 
	SECTION 2.16 Defaulted Interest
	 	 	24	 
	 
	 	 	 	 
	ARTICLE 3 REPURCHASE OF NOTES
	 	 	25	 
	 
	 	 	 	 
	SECTION 3.01 Repurchase at Option of Holders Upon a Fundamental Change
	 	 	25	 
	SECTION 3.02 Company Repurchase Notice
	 	 	26	 
	SECTION 3.03 Effect of Repurchase Notice; Withdrawal
	 	 	27	 
	SECTION 3.04 Deposit of Repurchase Price
	 	 	28	 
	SECTION 3.05 Notes Repurchased in Part
	 	 	28	 
	 
	 	 	 	 
	ARTICLE 4 COVENANTS
	 	 	28	 
	 
	 	 	 	 
	SECTION 4.01 Payment of Notes
	 	 	28	 
	SECTION 4.02 Maintenance of Office or Agency
	 	 	29	 
	SECTION 4.03 144A Information
	 	 	29	 
	SECTION 4.04 Existence
	 	 	29	 
	SECTION 4.05 Compliance Certificate
	 	 	29	 
	SECTION 4.06 Further Instruments and Acts
	 	 	30	 
	SECTION 4.07 Additional Interest Notice
	 	 	30	 
	SECTION 4.08 Reporting Obligation
	 	 	30	 

 

 

	 	 	 	 	 
	 	 	Page	 
	SECTION 4.09 Covenant to Obtain Stockholder Approval
	 	 	31	 
	SECTION 4.10 Incurrence of Indebtedness
	 	 	31	 
	 
	 	 	 	 
	ARTICLE 5 SUCCESSOR COMPANY
	 	 	31	 
	 
	 	 	 	 
	SECTION 5.01 When Company May Merge or Transfer Assets
	 	 	31	 
	SECTION 5.02 Successor to be Substituted
	 	 	32	 
	SECTION 5.03 Opinion of Counsel to be Given Trustee
	 	 	32	 
	 
	 	 	 	 
	ARTICLE 6 DEFAULTS AND REMEDIES
	 	 	32	 
	 
	 	 	 	 
	SECTION 6.01 Events of Default
	 	 	32	 
	SECTION 6.02 Acceleration
	 	 	34	 
	SECTION 6.03 Other Remedies
	 	 	35	 
	SECTION 6.04 Waiver of Past Defaults
	 	 	35	 
	SECTION 6.05 Control by Majority
	 	 	35	 
	SECTION 6.06 Limitation on Suits
	 	 	36	 
	SECTION 6.07 Rights of Noteholders to Receive Payment
	 	 	36	 
	SECTION 6.08 Collection Suit by Trustee
	 	 	36	 
	SECTION 6.09 Trustee May File Proofs of Claim
	 	 	36	 
	SECTION 6.10 Priorities
	 	 	37	 
	SECTION 6.11 Undertaking for Costs
	 	 	37	 
	SECTION 6.12 Waiver of Stay, Extension or Usury Laws
	 	 	37	 
	SECTION 6.13 Sole Remedy for Failure to Report
	 	 	37	 
	 
	 	 	 	 
	ARTICLE 7 TRUSTEE
	 	 	38	 
	 
	 	 	 	 
	SECTION 7.01 Duties of Trustee
	 	 	38	 
	SECTION 7.02 Rights of Trustee
	 	 	40	 
	SECTION 7.03 Individual Rights of Trustee
	 	 	41	 
	SECTION 7.04 Trustee’s Disclaimer
	 	 	41	 
	SECTION 7.05 Notice of Defaults
	 	 	41	 
	SECTION 7.06 Reports by Trustee to Noteholders
	 	 	42	 
	SECTION 7.07 Compensation and Indemnity
	 	 	42	 
	SECTION 7.08 Replacement of Trustee
	 	 	43	 
	SECTION 7.09 Successor Trustee by Merger
	 	 	43	 
	SECTION 7.10 Eligibility; Disqualification
	 	 	44	 
	SECTION 7.11 Preferential Collection of Claims Against Company
	 	 	44	 
	 
	 	 	 	 
	ARTICLE 8 DISCHARGE OF INDENTURE
	 	 	44	 
	 
	 	 	 	 
	SECTION 8.01 Discharge of Liability on Notes
	 	 	44	 
	SECTION 8.02 Application of Trust Money
	 	 	44	 
	SECTION 8.03 Repayment to Company
	 	 	45	 
	SECTION 8.04 Reinstatement
	 	 	45	 
	 
	 	 	 	 
	ARTICLE 9 AMENDMENTS
	 	 	45	 
	 
	 	 	 	 
	SECTION 9.01 Without Consent of Noteholders
	 	 	45	 
	SECTION 9.02 With Consent of Noteholders
	 	 	46	 

 

 

	 	 	 	 	 
	 	 	Page	 
	SECTION 9.03 Compliance with Trust Indenture Act
	 	 	48	 
	SECTION 9.04 Revocation and Effect of Consents and Waivers
	 	 	48	 
	SECTION 9.05 Notation on or Exchange of Notes
	 	 	49	 
	SECTION 9.06 Trustee to Sign Amendments
	 	 	49	 
	 
	 	 	 	 
	ARTICLE 10 CONVERSION OF NOTES
	 	 	49	 
	 
	 	 	 	 
	SECTION 10.01 Right to Convert
	 	 	49	 
	SECTION 10.02 Exercise of Conversion Right; Issuance of Common Stock on Conversion;
No Adjustment for Interest or Dividends
	 	 	51	 
	SECTION 10.03 Cash Payments in Lieu of Fractional Shares
	 	 	53	 
	SECTION 10.04 Conversion Rate
	 	 	53	 
	SECTION 10.05 Adjustment of Conversion Rate
	 	 	54	 
	SECTION 10.06 Effect of Reclassification, Consolidation, Merger or Sale
	 	 	64	 
	SECTION 10.07 Taxes on Shares Issued
	 	 	65	 
	SECTION 10.08 Reservation of Shares, Shares to be Fully Paid; Compliance with Governmental
Requirements; Listing of Common Stock
	 	 	65	 
	SECTION 10.09 Responsibility of Trustee
	 	 	66	 
	SECTION 10.10 Notice to Holders Prior to Certain Actions
	 	 	67	 
	SECTION 10.11 Settlement Upon Conversion
	 	 	67	 
	SECTION 10.12 Conversion After a Public Acquirer Change of Control
	 	 	68	 
	SECTION 10.13 Stockholder Rights Plans
	 	 	69	 
	 
	 	 	 	 
	ARTICLE 11 MISCELLANEOUS
	 	 	69	 
	 
	 	 	 	 
	SECTION 11.01 Trust Indenture Act Controls
	 	 	69	 
	SECTION 11.02 Notices
	 	 	69	 
	SECTION 11.03 Communication by Noteholders with Other Noteholders
	 	 	70	 
	SECTION 11.04 Certificate and Opinion as to Conditions Precedent
	 	 	71	 
	SECTION 11.05 Statements Required in Certificate or Opinion
	 	 	71	 
	SECTION 11.06 When Notes Disregarded
	 	 	71	 
	SECTION 11.07 Rules by Trustee, Paying Agent, Conversion Agent and Registrar
	 	 	72	 
	SECTION 11.08 Business Day
	 	 	72	 
	SECTION 11.09 Governing Law; Waiver of Jury Trial
	 	 	72	 
	SECTION 11.10 No Interpretation of or by Other Agreements
	 	 	72	 
	SECTION 11.11 Successors
	 	 	72	 
	SECTION 11.12 Multiple Originals
	 	 	72	 
	SECTION 11.13 Table of Contents; Headings
	 	 	72	 
	SECTION 11.14 Indenture and Notes Solely Corporate Obligations
	 	 	72	 
	SECTION 11.15 Severability
	 	 	73	 
	SECTION 11.16 Benefits of Indenture
	 	 	73	 
	SECTION 11.17 Calculations
	 	 	73	 
	SECTION 11.18 Qualification of Indenture
	 	 	73	 

Exhibit A — Form of Note

Exhibit B — Form of Restrictive Legend for Common Stock Issued Upon Conversion

 

 

     INDENTURE dated as of June 22, 2007, between VERIFONE HOLDINGS, INC., a Delaware corporation
(the “Company”), and U.S. BANK NATIONAL ASSOCIATION, a New York banking corporation, as trustee
(the “Trustee”).

     WHEREAS, the Company has duly authorized the creation of an issue of its 1.375% Senior
Convertible Notes due 2012 (the “Notes”), having the terms, tenor, amount and other provisions
hereinafter set forth, and, to provide therefor, the Company has duly authorized the execution and
delivery of this Indenture; and

     WHEREAS, all things necessary to make the Notes, when the Notes are duly executed by the
Company and authenticated and delivered hereunder and duly issued by the Company, the valid
obligations of the Company, and to make this Indenture a valid and binding agreement of the
Company, in accordance with 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, for and in consideration of the premises and the
purchase of the Notes by the Holders thereof, it is mutually covenanted and agreed, for the equal
and proportionate benefit of all Holders of the Notes, as follows:

ARTICLE 1

DEFINITIONS AND INCORPORATION BY REFERENCE

     SECTION 1.01 Definitions.

     “Additional Interest” has the meaning specified for “Additional Amounts” in any Registration
Rights Agreement, including in Section 3(a) of the Initial Registration Rights Agreement.

     “Additional Notes” has the meaning specified in Section 2.14.

     “Additional Notes Board Resolutions” means resolutions duly adopted by the Board of Directors
of the Company and delivered to the Trustee in an Officers’ Certificate providing for the issuance
of Additional Notes.

     “Additional Shares” has the meaning specified in Section 10.04(b).

     “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 Person means the power
to direct the management and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise; and the terms “controlling” and
“controlled” have meanings correlative to the foregoing.

     “Agent Members” has the meaning specified in Section 2.08(b)(vi).

1

 

     “American Depositary Receipt” means a negotiable certificate issued by a U.S. bank
representing a specified number of shares (or one share) in a foreign stock that is traded on a
U.S. securities exchange.

     “Bankruptcy Law” has the meaning specified in Section 6.01.

     “Board of Directors” means the Board of Directors of the Company or, other than in the case of
the definition of “Continuing Directors,” any committee thereof duly authorized to act on behalf of
such Board.

     “Business Day” has the meaning specified in Section 11.08.

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

     “Closing Date” means June 22, 2007, the date as of which this Indenture was originally
executed and delivered.

     “Closing Sale Price” of any share of Common Stock or any other security on any Trading Day
means:

     (i) the closing sale price per share of such security (or, if no closing sale price is
reported, the average of the closing bid and closing ask prices or, if more than one in either
case, the average of the average closing bid and the average closing ask prices) on such date as
reported in composite transactions for the principal U.S. securities exchange on which such
security is traded; or

     (ii) if such security is not listed on a U.S. national or regional securities exchange, the
last quoted bid price of such security on that date in the over-the-counter market as reported by
Pink Sheets LLC or a similar organization; or

     (iii) if such security is not listed on a U.S. national or regional securities exchange and is
not quoted by Pink Sheets LLC or a similar organization, as determined by a nationally recognized
securities dealer retained by the Company for that purpose.

The Closing Sale Price shall be determined without reference to extended or after hours trading.
The Closing Sale Price of the Common Stock may be adjusted pursuant to Section 10.05(j).

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

     “Common Stock” means Common Stock of the Company, par value $0.01 per share, as designated by
the Company at the Closing Date or shares of any class or classes resulting from any
reclassification or reclassifications thereof, provided that if at any time there shall be more
than one such resulting class, the shares of each such class then so issuable on conversion shall
be substantially in the proportion which the total number of shares of such class resulting from

2

 

all such reclassifications bears to the total number of shares of all such classes resulting
from all such reclassifications.

     “Company” means the party named as such in this Indenture until a successor replaces it and,
thereafter, means the successor.

     “Company Order” has the meaning specified in Section 2.04.

     “Company Repurchase Notice” has the meaning specified in Section 3.02.

     “Company Website” means, as of any date of determination, the principal website maintained by
the Company on the Internet, which is located at http://www.verifone.com as of the date hereof.

     “Continuing Directors” means, as of any date of determination, any member of the Board of
Directors who (i) was a member of the Board of Directors on the Closing Date; or (ii) was nominated
for election or elected to the Board of Directors with the approval of a majority of the Continuing
Directors who were members of the Board of Directors at the time of such new director’s nomination
or election.

     “Conversion Agent” has the meaning specified in Section 2.05.

     “Conversion Date” has the meaning specified in Section 10.02.

     “Conversion Notice” has the meaning specified in Section 10.02.

     “Conversion Period” means, with respect to any Note delivered for conversion, the 20
consecutive Trading Day period:

(a) with respect to Conversion Notices in respect of such Note received during the period
beginning 25 Scheduled Trading Days preceding the Maturity Date and ending on the second
Business Day preceding the Maturity Date, beginning on the 22nd Scheduled Trading Day
immediately preceding the Maturity Date; and

(b) in all other cases, beginning on the third Trading Day following the receipt by the
Company of the Conversion Notice in respect of such Note.

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

     “Conversion Rate” means initially 22.7190 shares of Common Stock, subject to adjustment as set
forth herein.

     “Conversion Settlement Amount” has the meaning specified in Section 10.11.

     “Corporate Trust Office” or other similar term, means the designated office of the Trustee at
which at any particular time its corporate trust business as it relates to this Indenture shall be
administered, which office is, at the Closing Date, located at 100 Wall Street, Suite

3

 

1600, EX-NY-WALL, New York, New York 10005, or at any other time at such other address as the
Trustee may designate from time to time by notice to the Company.

     “Current Market Price” has the meaning specified in Section 10.05(h)(i).

     “Custodian” has the meaning specified in Section 6.01.

     “Daily Conversion Value” has the meaning specified in Section 10.11.

     “Daily Settlement Amount” has the meaning specified in Section 10.11.

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

     “Defaulted Interest” has the meaning specified in 0.

     “Depositary” means the clearing agency registered under the Exchange Act that is designated to
act as the Depositary for the Global Notes. DTC shall be the initial Depositary, 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.

     “Depositary Entity” has the meaning specified in Section 9.04.

     “Distributed Assets” has the meaning specified in Section 10.05(d).

     “Distribution Notice” has the meaning specified in Section 10.01(b).

     “DTC” means The Depository Trust Company.

     “Effective Date” has the meaning specified in Section 10.04(b).

     “Event of Default” has the meaning specified in Section 6.01.

     “Ex-Dividend Date” has the meaning specified in Section 10.05(h)(ii).

     “Exchange Act” means the Securities Exchange Act of 1934, as amended.

     “Expiration Date” has the meaning specified in Section 10.05(f).

     “Expiration Time” has the meaning specified in Section 10.05(f).

     “Fair Market Value” means the amount which a willing buyer would pay a willing seller in an
arm’s-length transaction as determined by the Board of Directors.

     “Fiscal Quarter” means, with respect to the Company, the fiscal quarter publicly disclosed by
the Company. The Company shall confirm the ending dates of its fiscal quarters for the current
fiscal year to the Trustee upon the Trustee’s request.

4

 

     “Fundamental Change” means the occurrence of any of the following after the Closing Date:

     (a) the consummation of any transaction (including, without limitation, any merger or
consolidation) the result of which is that any “person” becomes the “beneficial owner” (as these
terms are defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act), directly or indirectly, of
more than 50% of the Company’s Capital Stock that is at the time entitled to vote by the holder
thereof in the election of the Board of Directors (or comparable body);

     (b) the first day on which a majority of the members of the Board of Directors are not
Continuing Directors;

     (c) the adoption of a plan relating to the liquidation or dissolution of the Company;

     (d) the consolidation or merger of the Company with or into any other Person, or the sale,
lease, transfer, conveyance or other disposition, in one or a series of related transactions, of
all or substantially all of the Company’s assets and those of the Company’s Subsidiaries taken as a
whole to any “person” (as such term is used in Section 13(d)(3) of the Exchange Act), other than:

     (i) any transaction (x) that does not result in any reclassification, conversion,
exchange or cancellation of outstanding shares of the Company’s Capital Stock, and (y)
pursuant to which the holders of 50% or more of the total voting power of all shares of the
Company’s Capital Stock entitled to vote generally in elections of directors of the Company
immediately prior to such transaction have the right to exercise, directly or indirectly,
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 of the continuing or surviving Person
immediately after giving effect to such transaction; or

     (ii) any merger primarily for the purpose of changing the Company’s jurisdiction of
incorporation and resulting in a reclassification, conversion or exchange of outstanding
            shares of Common Stock solely into shares of capital stock of the surviving entity.

     (e) the termination of trading of the Common Stock, which will be deemed to have occurred if
the Common Stock or other Capital Stock or American Depositary Receipts in respect of shares of
Capital Stock into which the Notes are convertible is neither listed for trading on a United States
national securities exchange nor approved for listing on any United States system of automated
dissemination of quotations of securities prices.

     Notwithstanding the foregoing, a Fundamental Change will be deemed not to have occurred if
more than 90% of the consideration in the transaction or transactions (other than cash payments for
fractional shares and cash payments made in respect of dissenters’ appraisal rights) which
otherwise would constitute a Fundamental Change under clauses (a) or (d) above consists of shares
of Capital Stock or American Depositary Receipts in respect of shares of Capital Stock traded or to
be traded immediately following such transaction on a national securities exchange,

5

 

and, as a result of the transaction or transactions, the Notes become convertible into such
Capital Stock or American Depositary Receipts and other applicable consideration.

     “Fundamental Change Repurchase Date” has the meaning specified in Section 3.01(a).

     “Global Notes” has the meaning specified in Section 2.02.

     “Indenture” means this Indenture as amended or supplemented from time to time.

     “Initial Purchasers” means Lehman Brothers Inc. and J.P. Morgan Securities Inc.

     “Initial Registration Rights Agreement” means the Registration Rights Agreement, dated as of
the Closing Date, between the Company and the Initial Purchasers, as amended from time to time in
accordance with its terms.

     “interest” means, when used with reference to the Notes, any interest payable under the terms
of the Notes, including Defaulted Interest, if any, Additional Interest, if any, Reporting
Additional Interest, if any and Share Cap Additional Interest, if any.

     “Interest Payment Date” has the meaning specified in Section 2.03.

     “Issue Date” means the date of initial issuance of Notes pursuant to this Indenture.

     “Market Disruption Event” means (a) a failure by the principal U.S. national or regional
securities exchange on which the Common Stock is then listed or, if the Common Stock is not listed
on a U.S. national or regional securities exchange, the principal other market on which the Common
Stock is then traded to open for trading during its regular trading session, or (b) the occurrence
or existence prior to 1:00 p.m., New York City time, on any Trading Day for the Common Stock of an
aggregate one-half hour of suspension or limitation imposed on trading (by reason of movements in
price exceeding limits permitted by a stock exchange or otherwise) in the Common Stock or in any
option contracts or futures contracts relating to the Common Stock.

     “Maturity Date” means June 15, 2012.

     “Non-Stock Change of Control” means a transaction constituting a Fundamental Change of the
type described under clause (a) or clause (d) in the definition of Fundamental Change pursuant to
which 10% or more of the consideration for Common Stock (other than cash payments for fractional
shares, if applicable, and cash payments made in respect of dissenters’ appraisal rights, if
applicable) in such transaction consists of cash or securities (or other property) that are not
shares of Capital Stock or American Depositary Receipts in respect of shares of Capital Stock
traded or scheduled to be traded immediately following such transaction on a U.S. national
securities exchange.

     “Noteholder” or “Holder” means the Person in whose name a Note is registered on the
Registrar’s books.

6

 

     “Notes” means any Notes issued, authenticated and delivered under this Indenture, including
any Global Notes and any Additional Notes.

     “Notice of Default” has the meaning specified in Section 6.01.

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

     “Officers’ Certificate” means a certificate signed by two Officers. One of the officers
executing an Officers’ Certificate in accordance with Section 4.05 shall be the chief executive,
chief financial or chief accounting officer of the Company.

     “Opinion of Counsel” means a written opinion from legal counsel. The counsel may, but need
not be, an employee of the Company.

     “Paying Agent” has the meaning specified in Section 2.05.

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

     “PORTAL Market” means The PORTAL Market operated by the Nasdaq Stock Market or any successor
thereto.

     “Preferred Stock”, as applied to the Capital Stock of any Person, means Capital Stock of any
class or classes (however designated) that is preferred as to the payment of dividends, or as to
the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such
Person, over shares of Capital Stock of any other class of such Person.

     “protected purchaser” has the meaning specified in Section 2.09.

     “Public Acquirer Change of Control” means a Non-Stock Change of Control in which the acquirer
has a class of common stock traded on a U.S. national securities exchange or that shall be so
traded when issued or exchanged in connection with such Non-Stock Change of Control (the “Public
Acquirer Common Stock”). If an acquirer does not itself have a class of common stock satisfying
the foregoing requirement, it shall be deemed to have Public Acquirer Common Stock if a corporation
that directly or indirectly owns at least a majority of the acquirer has a class of common stock
satisfying the foregoing requirement, provided that such corporation fully and unconditionally
guarantees the Notes, in which case all references to Public Acquirer Common Stock shall refer to
such class of common stock. Majority owned for these purposes means having “beneficial ownership”
(as defined in Rule 13d-3 under the Exchange Act) of more than 50% of the total voting power of all
shares of the respective entity’s capital stock that are entitled to vote generally in the election
of directors.

     “Public Acquirer Common Stock” has the meaning specified in the definition of Public Acquirer
Change of Control.

7

 

     “Purchase Agreement” means the Purchase Agreement, dated June 18, 2007, among the Company and
the Initial Purchasers relating to the offering and sale of the Notes.

     “Record Date” means, 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
holders of Common Stock 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).

     “Reference Property” has the meaning specified in Section 10.06.

     “Register” has the meaning specified in Section 2.05.

     “Registrar” has the meaning specified in Section 2.05.

     “Registration Rights Agreement” means the Initial Registration Rights Agreement and, with
respect to any Additional Notes, one or more registration rights agreements between the Company and
the other parties thereto relating to rights given by the Company to the purchasers of Additional
Notes to register such Additional Notes and the Common Stock into which such Additional Notes are
convertible under the Securities Act.

     “Regular Record Date” means (i) with respect to an Interest Payment Date that falls on June
15, the June 1 immediately preceding such Interest Payment Date and (ii) with respect to an
Interest Payment Date that falls on December 15, the December 1 immediately preceding such Interest
Payment Date.

     “Reporting Additional Interest” has the meaning specified in Section 6.13 hereof.

     “Repurchase Notice” has the meaning specified in Section 3.01(c).

     “Restricted Securities” has the meaning specified in Section 2.08(c).

     “Rule 144A” means Rule 144A as promulgated under the Securities Act as it may be amended from
time to time hereafter.

     “Scheduled Trading Day” means any day on which the primary U.S. national securities exchange
or market on which Common Stock is listed or admitted for trading is scheduled to be open for
trading.

     “SEC” means the Securities and Exchange Commission.

     “Securities Act” means the Securities Act of 1933, as amended.

     “Share Cap” means 10.2766 shares of Common Stock per $1,000 principal amount of Notes.

8

 

     “Share Cap Additional Interest” has the meaning specified in Section 2.15.

     “Significant Subsidiary” means any Subsidiary of the Company that would be a “Significant
Subsidiary” of the Company within the meaning specified in Rule 1-02(w) under Regulation S-X
promulgated by the SEC.

     “Special Interest Payment Date” has the meaning specified in Section 2.16(a).

     “Special Record Date” has the meaning specified in Section 2.16(a).

     “Spin-Off” has the meaning specified in Section 10.05(d).

     “Spin-Off Distributed Assets” has the meaning specified in Section 10.05(d)(B).

     “Spin-Off Valuation Period” has the meaning specified in Section 10.05(d).

     “Stated Maturity” means, with respect to any security, the date specified in such security as
the fixed date on which the final payment of principal of such security is due and payable,
including pursuant to any mandatory redemption provision (but excluding any provision providing for
the repurchase of such security at the option of the holder thereof upon the happening of any
contingency beyond the control of the issuer unless such contingency has occurred).

     “Stockholder Approval” means the authorization and approval by stockholders holding the
requisite number of shares of Capital Stock of the Company in accordance with the Company’s
certificate of incorporation and by-laws, applicable law and the rules of the New York Stock
Exchange or other securities exchange on which the Common Stock is then listed for trading, and at
a meeting duly called and held in accordance with such organizational documents, applicable law and
rules, of a proposal by the Company to increase the number of shares of Common Stock authorized by
the Company’s certificate of incorporation such that the Company is authorized to issue a number of
additional shares of Common Stock equal to at least (i) the Conversion Rate multiplied by (ii) the
aggregate principal amount of the Notes outstanding divided by $1,000.

     “Stock Price” means:

     (i) in the case of a Non-Stock Change of Control in which holders of the Common Stock
receive only cash as consideration for their share of Common Stock, the amount of cash paid
per share of the Common Stock in such Non-Stock Change of Control; or

     (ii) in the case of all other Non-Stock Changes of Control, the average of the last
reported sale prices of Common Stock on the five consecutive Trading Days prior to but not
including the Effective Date of such Non-Stock Change of Control.

     “Subsidiary” of any Person means any corporation, association, partnership or other business
entity of which more than 50% of the total voting power of shares of Capital Stock or

9

 

other interests (including partnership interests) entitled (without regard to the occurrence
of any contingency) to vote in the election of directors, managers or trustees thereof is at the
time owned or controlled, directly or indirectly, by (i) such Person, (ii) such Person and one or
more Subsidiaries of such Person or (iii) one or more Subsidiaries of such Person.

     “TIA” or “Trust Indenture Act” means the Trust Indenture Act of 1939 (15 U.S.C. §§
77aaa-77bbbb), as amended, as in effect on the date of this Indenture.

     “Trading Day” means a day during which (i) trading in the Common Stock generally occurs, and
(ii) there is no Market Disruption Event.

     “Trading Price” means, with respect to a Note on any date of determination, the average of the
secondary market bid quotations per $1,000 principal amount of Notes obtained by the Trustee for
$5,000,000 principal amount of Notes at approximately 3:30 p.m., New York City time, on such
determination date from two independent nationally recognized securities dealers selected by the
Company, which may include one or more of the Initial Purchasers; provided that if at least two
such bids cannot reasonably be obtained by the Trustee, but one such bid can be reasonably obtained
by the Trustee, then this one bid shall be used; and provided further that, if the Trustee cannot
reasonably obtain at least one bid for $5,000,000 principal amount of Notes from a nationally
recognized securities dealer or in the Company’s reasonable judgment, the bid quotations are not
indicative of the secondary market value of the Notes then, for the purpose of determining the
convertibility of the Notes pursuant to Section 10.01(a)(6) only, the Trading Price per $1,000
principal amount of Notes shall be deemed to be less than 98% of the product of (a) the Conversion
Rate on such determination date and (b) the Closing Sale Price of a share of Common Stock on such
determination date.

     “Trigger Event” has the meaning specified in Section 10.05(d).

     “Trust Officer” means any officer within the Corporate Trust Office of the Trustee with direct
responsibility for the administration of this Indenture.

     “Trustee” means the party named as such in this Indenture until a successor replaces it and,
thereafter, means the successor.

     “Uniform Commercial Code” means the New York Uniform Commercial Code as in effect from time to
time.

     “Volume Weighted Average Price” per share of Common Stock on any Trading Day means such price
as displayed on Bloomberg (or any successor service) Page PAY.N <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 price
is unavailable, the market value per share of Common Stock on such Trading Day as determined by a
nationally recognized independent investment banking firm retained for this purpose by the Company.

     “Wholly Owned Subsidiary” means a Subsidiary of the Company, all the Capital Stock of which
(other than directors’ qualifying shares) is owned by the Company or another Wholly Owned
Subsidiary.

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     SECTION 1.02 Incorporation by Reference of Trust Indenture Act. This Indenture is subject
to the mandatory provisions of the TIA, which are incorporated by reference in and made a part of
this Indenture. The following TIA terms have the following meanings:

     “Commission” means the SEC.

     “indenture securities” means the Notes.

     “indenture security holder” means a Noteholder.

     “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 TIA terms used in this Indenture that are defined by the TIA, defined by TIA
reference to another statute or defined by SEC rule have the meanings assigned to them by such
definitions.

     SECTION 1.03 Rules of Construction. Unless the context otherwise requires:

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

     (2) “or” is not exclusive;

     (3) “including” means including without limitation; and

     (4) words in the singular include the plural and words in the plural include the singular.

ARTICLE 2

THE NOTES

     SECTION 2.01 Designation, Amount and Issuance of Notes. The Notes shall be designated as
“1.375% Senior Convertible Notes due 2012.” The Notes initially will be issued in an aggregate
principal amount not to exceed (i) $316,250,000 plus (ii) such additional aggregate principal
amount of Notes as may be issued from time to time as Additional Notes in accordance with Section
2.14. Notes may be executed by the Company and delivered to the Trustee for authentication as
provided in Section 2.04.

     SECTION 2.02 Form of the 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 hereto.
The terms and provisions contained in the form of Notes attached as Exhibit A hereto 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.

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     Any of the Notes may have such letters, numbers or other marks of identification and such
notations, legends, endorsements or changes 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 by the custodian for the Global Notes, the
Depositary or by the National Association of Securities Dealers, Inc. in order for the Notes to be
tradable on the PORTAL Market or as may be required for the Notes to be tradable on any other
market developed for trading of securities pursuant to Rule 144A or as may be required to comply
with any applicable law or with any rule or regulation made pursuant thereto or with any rule or
regulation of any securities exchange or automated quotation system on which the Notes may be
listed, or to conform to usage, or to indicate any special limitations or restrictions to which any
particular Notes are subject.

     Except as contemplated by Section 2.08(b), all of the Notes will be represented by one or more
Notes in global form registered in the name of the Depositary or the nominee of the Depositary
(“Global Notes”). The transfer and exchange of beneficial interests in any such Global Notes shall
be effected through the Depositary in accordance with this Indenture and the applicable procedures
of the Depositary; and beneficial interests in the Global Notes shall be subject to all rules and
procedures of the Depositary. Except as provided in Section 2.08(b), beneficial owners of a Global
Note shall not be entitled to have certificates registered in their names, will not receive or be
entitled to receive physical delivery of certificates in definitive form and will not be considered
Holders of such Global Note.

     Any Global Notes shall represent such of the outstanding Notes as shall be specified therein
and shall provide that it shall represent the aggregate amount of outstanding Notes from time to
time endorsed thereon and that the aggregate 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 a 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 for the Global Note, 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 of and interest on any Global Notes shall be made to the Depositary in immediately
available funds.

     SECTION 2.03 Date and Denomination of Notes; Payment at Maturity; Payment 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 in the form of Notes 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 amount of interest payable for any period that is less than a whole month shall
be computed on the basis of the actual number of days elapsed during such less than whole-month
period divided by 360.

     If any payment date is not a Business Day, payment will be made on the next succeeding
Business Day and no interest will accrue thereon.

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     On the Maturity Date, each Holder shall be entitled to receive on such date $1,000 principal
amount per Notes and accrued and unpaid interest to, but not including, the Maturity Date. With
respect to Global Notes, such principal and interest will be paid to the Depositary in immediately
available funds. With respect to any certificated Notes, such principal and interest will be
payable at the Company’s office or agency maintained for that purpose, which initially will be the
office or agency of the Trustee located at 100 Wall Street, Suite 1600, EX-NY-WALL, New York, New
York 10005, Attention: Richard Prokosch.

     Interest on the Notes will accrue at the rate of 1.375% per annum, from June 22, 2007 until
the principal thereof is paid or made available for payment. Interest shall be payable on June 15
and December 15 of each year (each, an “Interest Payment Date”), commencing December 15, 2007, to
the Person in whose name any Note is registered on the Register at 5:00 p.m., New York City time,
on any Regular Record Date with respect to the applicable Interest Payment Date, except that the
interest payable upon the Maturity Date will be payable to the Person to whom the principal amount
is paid. Notwithstanding the foregoing, any Notes or portion thereof surrendered for conversion
after 5:00 p.m., New York City time, on the Regular Record Date for an Interest Payment Date but
prior to the applicable Interest Payment Date shall be accompanied by payment, in immediately
available funds or other funds acceptable to the Company, of an amount equal to the interest
(excluding any Additional Interest, Reporting Additional Interest or Share Cap Additional Interest)
otherwise payable on such Interest Payment Date on the principal amount being converted; provided
that no such payment need be made:

     (i) with respect to conversions after 5:00 p.m., New York City time, on the Regular
Record Date immediately preceding the Maturity Date;

     (ii) with respect to a conversion in connection with a Fundamental Change and the
Company has specified a Fundamental Change Repurchase Date that is after a Regular Record
Date and on or prior to the corresponding Interest Payment Date; and

     (iii) with respect to any Defaulted Interest or interest that is otherwise overdue, if
any such interest exists at the time of conversion with respect to such Notes.

     The Company shall pay interest:

     (i) on any Global Notes by wire transfer of immediately available funds to the account
of the Depositary or its nominee;

     (ii) on any Notes in certificated form having a principal amount of less than
$5,000,000, by check mailed to the address of the Person entitled thereto as it appears in
the Register, provided, however, that at maturity interest will be payable at the office of
the Company maintained by the Company for such purposes, which shall initially be an office
or agency of the Trustee; and

     (iii) on any Notes in certificated form having a principal amount of $5,000,000 or
more, by wire transfer in immediately available funds at the election of the Holder of such
Notes duly delivered to the Trustee at least five Business Days prior to the relevant
Interest Payment Date, provided, however, that at maturity interest will be payable at the

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     office of the Company maintained by the Company for such purposes, which shall
initially be an office or agency of the Trustee.

     SECTION 2.04 Execution and Authentication. One Officer shall sign the Notes for the Company
by manual or facsimile signature.

     If an Officer whose signature is on a Note no longer holds that office at the time the Trustee
authenticates the Note, the Note shall be valid nevertheless.

     A Note shall not be valid until an authorized signatory of the Trustee manually signs the
certificate of authentication on the Note. The signature shall be conclusive evidence that the
Note has been authenticated under this Indenture.

     The Trustee shall authenticate and make available for delivery Notes for original issue, upon
receipt of a written order or orders of the Company signed by an Officer (a “Company Order”): (i)
pursuant to the Purchase Agreement, in the aggregate principal amount of up to $316,250,000 and
(ii) from time to time, in such aggregate principal amount as shall be established for any
Additional Notes established pursuant to the respective Officers’ Certificate in respect thereof
delivered pursuant to Section 2.14. The Company Order shall specify the number, principal amount
and registered Holder of the Notes to be authenticated and shall state the date on which such Notes
are to be authenticated.

     The Trustee may appoint an authenticating agent reasonably acceptable to the Company to
authenticate the Notes. Any such appointment shall be evidenced by an instrument signed by a Trust
Officer, a copy of which shall be furnished to the Company. Unless limited by the terms of such
appointment, an authenticating agent may authenticate Notes whenever the Trustee may do so. Each
reference in this Indenture to authentication by the Trustee includes authentication by such agent.
An authenticating agent has the same rights as any Registrar, Paying Agent or agent for service of
notices and demands.

     SECTION 2.05 Registrar, Paying Agent and Conversion Agent. The Company shall maintain an
office or agency where Notes may be presented for registration of transfer or for exchange (the
“Registrar”), an office or agency where Notes may be presented for payment (the “Paying Agent”) and
an office or agency where Notes may be presented for conversion (the “Conversion Agent”). The
Corporate Trust Office shall be considered as one such office or agency of the Company for each of
the aforesaid purposes. The Registrar shall keep a register of the Notes (the “Register”) and of
their transfer and exchange. The Company may have one or more co-registrars, one or more additional
paying agents and one or more additional conversion agents. The term “Paying Agent” includes any
additional paying agent, the term “Registrar” includes any co-registrars and the term “Conversion
Agent” includes any additional conversion agent. The Company initially appoints the Trustee as (i)
Registrar, Paying Agent and Conversion Agent in connection with the Notes and (ii) the custodian
with respect to the Global Notes.

     The Company shall enter into an appropriate agency agreement with any Registrar, Paying Agent
or Conversion Agent not a party to this Indenture, which shall incorporate the terms of the TIA.
The agreement shall implement the provisions of this Indenture that relate to

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such agent. The Company shall notify the Trustee of the name and address of any such agent.
If the Company fails to maintain a Registrar, Paying Agent or Conversion Agent, the Trustee shall
act as such and shall be entitled to appropriate compensation therefor pursuant to Section 7.07.
The Company or any of its domestically organized Wholly Owned Subsidiaries may act as Paying Agent
or Registrar.

     The Company may remove any Registrar, Paying Agent or Conversion Agent upon written notice to
such Registrar, Paying Agent, Conversion Agent and to the Trustee; provided, however, that no such
removal shall become effective until (1) acceptance of an appointment by a successor as evidenced
by an appropriate agreement entered into by the Company and such successor Registrar, Paying Agent
or Conversion Agent, as the case may be, and delivered to the Trustee or (2) notification to the
Trustee that the Trustee shall serve as Registrar, Paying Agent or Conversion Agent until the
appointment of a successor in accordance with clause (1) above. The Registrar, Paying Agent or
Conversion Agent may resign at any time upon written notice; provided, however, that the Trustee
may resign as Paying Agent, Conversion Agent or Registrar only if the Trustee also resigns as
Trustee in accordance with Section 7.08.

     SECTION 2.06 Paying Agent to Hold Money in Trust. Prior to each due date of the principal
and interest on any Note, the Company shall deposit with the Paying Agent (or if the Company or a
Subsidiary is acting as Paying Agent, segregate and hold in trust for the benefit of the Persons
entitled thereto) a sum sufficient to pay such principal and interest when so becoming due. The
Company shall require each Paying Agent (other than the Trustee) to agree in writing that the
Paying Agent shall hold in trust for the benefit of Noteholders or the Trustee all money held by
the Paying Agent for the payment of principal of or interest on the Notes and shall notify the
Trustee of any default by the Company in making any such payment. If the Company or a Subsidiary of
the Company acts as Paying Agent, it shall segregate the money held by it as Paying Agent and hold
it as a separate trust fund. The Company at any time may require a Paying Agent to pay all money
held by it to the Trustee and to account for any funds disbursed by the Paying Agent. Upon
complying with this Section, the Paying Agent shall have no further liability for the money
delivered to the Trustee.

     SECTION 2.07 Noteholder Lists. The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and addresses of
Noteholders and shall otherwise comply with Section 312(a) of the TIA. If the Trustee is not the
Registrar, or to the extent otherwise required under the TIA, the Company shall furnish, or cause
the Registrar to furnish, to the Trustee, in writing at least five Business Days before each
Interest Payment Date and at such other times as the Trustee may request in writing, a list in such
form and as of such date as the Trustee may reasonably require of the names and addresses of
Noteholders and shall otherwise comply with Section 312(a) of the TIA.

     SECTION 2.08 Exchange and Registration of Transfer of Notes; Restrictions on Transfer. (a)
The Company shall cause to be kept at the Corporate Trust Office the 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. The Register shall be in written form or in any form capable of
being converted into written form within a reasonably prompt period of time.

15

 

     Upon surrender for registration of transfer of any Notes to the Registrar or any co-registrar,
and satisfaction of the requirements for such transfer set forth in this Section 2.08, 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 4.02. Whenever any Notes are so surrendered for
exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Notes that
the Holder making the exchange is entitled to receive bearing registration numbers not
contemporaneously outstanding.

     All Notes issued upon any registration of transfer or exchange of Notes 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.

     All Notes presented or surrendered for registration of transfer or for exchange, repurchase or
conversion shall (if so required by the Company or the Registrar) be duly endorsed, or be
accompanied by a written instrument or instruments of transfer in form satisfactory to the Company,
and the Notes shall be duly executed by the Holder thereof or its attorney duly authorized in
writing.

     No service charge shall be made to any Holder for any registration of, transfer or exchange of
Notes, but the Company or the Trustee may require payment by the Holder of a sum sufficient to
cover any tax, assessment or other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Notes.

     Neither the Company nor the Trustee nor any Registrar shall be required to exchange, issue or
register a transfer of (a) any Notes or portions thereof surrendered for conversion pursuant to
Article 10 or (b) any Notes or portions thereof tendered for repurchase (and not withdrawn)
pursuant to Article 3.

     (b) The following provisions shall apply only to Global Notes:

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

     (ii) Notwithstanding any other provision in this Indenture, no Global Note may be
exchanged in whole or in part for Notes registered, and no transfer of a Global Note in
whole or in part may be registered, in the name of any Person other than the Depositary or a
nominee thereof unless

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     (A) the Depositary (x) has notified the Company that it is unwilling or unable
to continue as Depositary for such Global Note or (y) has ceased to be a clearing
agency registered under the Exchange Act, and a successor depositary has not been
appointed by the Company within 90 calendar days, or

     (B) the Company, in its sole discretion, notifies the Trustee in writing that
it no longer wishes to have all the Notes represented by Global Notes.

Any Global Notes exchanged pursuant to this Section 2.08(b)(ii) shall be so exchanged in
whole and not in part.

     (iii) In addition, certificated Notes will be issued in exchange for beneficial
interests in a Global Note upon request by or on behalf of the Depositary in accordance with
customary procedures following the request of a beneficial owner seeking to enforce its
rights under the Notes or this Indenture, including its rights following the occurrence of
an Event of Default.

     (iv) Notes issued in exchange for a Global Note or any portion thereof pursuant to
clause (ii) or (iii) above shall be issued in definitive, fully registered form, without
interest coupons, shall have an aggregate principal amount equal to that of such Global
Notes or portion thereof to be so exchanged, shall be registered in such names and be in
such authorized denominations as the Depositary shall designate and shall bear any legends
required hereunder. Any Global Notes to be exchanged shall be surrendered by the Depositary
to the Trustee, as Registrar, provided that pending completion of the exchange of a Global
Note, the Trustee acting as custodian for the Global Notes for the Depositary or its nominee
with respect to such Global Notes, shall reduce the principal amount thereof, by an amount
equal to the portion thereof to be so exchanged, by means of an appropriate adjustment made
on the records of the Trustee. Upon any such surrender or adjustment, the Trustee shall
authenticate and make available for delivery the Notes issuable on such exchange to or upon
the written order of the Depositary or an authorized representative thereof.

     (v) In the event of the occurrence of any of the events specified in clause (ii) above
or upon any request described in clause (iii) above, the Company will promptly make
available to the Trustee a sufficient supply of certificated Notes in definitive, fully
registered form, without interest coupons.

     (vi) Neither any members of, or participants in, the Depositary (“Agent Members”) nor
any other Persons on whose behalf Agent Members may act shall have any rights under this
Indenture with respect to any Global Notes registered in the name of the Depositary or any
nominee thereof, and the Depositary or such nominee, as the case may be, may be treated by
the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner
and Holder of such Global Notes for all purposes whatsoever. Notwithstanding the foregoing,
nothing herein shall prevent the Company, the Trustee or any agent of the Company or the
Trustee from giving effect to any written certification, proxy or other authorization
furnished by the Depositary or such nominee, as the case may be, or impair, as between the
Depositary, its Agent Members and any

17

 

other Person on whose behalf an Agent Member may act, the operation of customary
practices of such Persons governing the exercise of the rights of a Holder of any Notes.

     (vii) At such time as all interests in a Global Note have been repurchased, converted,
cancelled or exchanged for Notes in certificated form, such Global Note shall, upon receipt
thereof, be cancelled by the Trustee in accordance with standing procedures and instructions
existing between the Depositary and the custodian for the Global Note. At any time prior to
such cancellation, if any interest in a Global Note is repurchased, converted, cancelled or
exchanged for Notes in certificated form, the principal amount of such Global Note shall, in
accordance with the standing procedures and instructions existing between the Depositary and
the custodian for the Global Note, be appropriately reduced by the Trustee and the
Depositary in their records.

     (c) Every Note (and all securities issued in exchange therefor or in substitution thereof)
that bears or is required under this Section 2.08(c) to bear the legend set forth in this Section
2.08(c) (together with any Common Stock issued upon conversion of the Notes and required to bear
the legend set forth in Exhibit B, collectively, the “Restricted Securities”) shall be
subject to the restrictions on transfer set forth in this Section 2.08(c) (including those set
forth in the legend below and the legend set forth in Exhibit B) unless such restrictions
on transfer shall be waived by written consent of the Company following receipt of legal advice
supporting the permissibility of the waiver of such transfer restrictions, and the holder of each
such Restricted Security, by such holder’s acceptance thereof, agrees to be bound by all such
restrictions on transfer. As used in this Section 2.08(c), the term “transfer” means any sale,
pledge, loan, transfer or other disposition whatsoever of any Restricted Security or any interest
therein.

     Prior to the date two years following the later of the Closing Date and the date of the last
subsequent issuance of the Notes, if any, any certificate evidencing a Restricted Security shall
bear a legend in substantially the following form (or as set forth in Exhibit B, in the
case of Common Stock issued upon conversion of the Notes), unless such Restricted Security has been
sold pursuant to a registration statement that has been declared effective under the Securities Act
(and which continues to be effective at the time of such transfer) or sold pursuant to Rule 144
under the Securities Act or any similar provision then in force, or unless otherwise agreed by the
Company in writing as set forth above, with written notice thereof to the Trustee:

THE SECURITY EVIDENCED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT OF 1933”), OR ANY STATE
SECURITIES LAWS, AND MAY NOT BE OFFERED OR SOLD EXCEPT AS SET FORTH IN THE FOLLOWING
SENTENCE. BY ACQUISITION HEREOF OR A BENEFICIAL INTEREST HEREIN, THE HOLDER:

(1) REPRESENTS THAT IT IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT OF 1933;

(2) AGREES THAT IT WILL NOT PRIOR TO THE DATE TWO YEARS AFTER THE DATE OF ORIGINAL
ISSUANCE OF THE 1.375% SENIOR

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CONVERTIBLE NOTES DUE 2012 OF VERIFONE HOLDINGS, INC. (THE “COMPANY”) RESELL OR
OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY OR THE COMMON STOCK THAT MAY BE
ISSUABLE UPON CONVERSION OF SUCH SECURITY EXCEPT (A) TO THE COMPANY OR ANY
SUBSIDIARY THEREOF, (B) TO A PERSON IT REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT OF 1933,
(C) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT OF 1933 AND WHICH CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH
TRANSFER, OR (D) PURSUANT TO ANY OTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS
UNDER THE SECURITIES ACT, INCLUDING UNDER RULE 144, IF AVAILABLE, SUBJECT TO OUR AND
THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH TRANSFER, TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATIONS AND/OR OTHER INFORMATION SATISFACTORY TO US AND
THE TRUSTEE; AND

(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE SECURITY EVIDENCED HEREBY
IS TRANSFERRED (OTHER THAN A TRANSFER PURSUANT TO CLAUSE 2(C) ABOVE) A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

     In connection with any transfer of the Notes prior to the date two years following the later
of the Closing Date and the date of the last subsequent issuance of the Notes, if any (other than a
transfer pursuant to clause (2)(C) above), the Holder must complete and deliver the transfer
certificate contained in this Indenture to the Trustee (or any successor Trustee, as applicable).
If the proposed transfer is pursuant to clause (2)(D) above, the Holder must, prior to such
transfer, furnish to the Trustee (or any successor Trustee, as applicable), such certifications,
legal opinions or other information as the Company may reasonably require to confirm that such
transfer is being made pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act. The legend set forth above will be removed upon
the earlier of the transfer of the Notes evidenced thereby pursuant to clause (2)(C) above or the
expiration of two years from the last date of original issuance of the Notes (including any
Additional Notes issued pursuant to Section 2.14).

     Any Notes that are Restricted Securities and as to which such restrictions on transfer shall
have expired in accordance with their terms or as to conditions for removal of the foregoing legend
set forth therein have been satisfied may, upon surrender of such Notes for exchange to the
Registrar in accordance with the provisions of this Section 2.08, be exchanged for a new Note or
Notes, of like tenor and aggregate principal amount, which shall not bear the restrictive legend
required by this Section 2.08(c). If such Restricted Security surrendered for exchange is
represented by a Global Note bearing the legend set forth in this Section 2.08(c), the principal
amount of the legended Global Notes shall be reduced by the appropriate principal amount and the
principal amount of a Global Note without the legend set forth in this Section 2.08(c) shall be
increased by an equal principal amount. If a Global Note without the legend set forth in this

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Section 2.08(c) is not then outstanding, the Company shall execute and the Trustee shall
authenticate and deliver an unlegended Global Note to the Depositary.

     In the event Rule 144(k) as promulgated under the Securities Act is amended to change the
two-year period under Rule 144(k), then, the references in the restrictive legend set forth above
to “two years,” and in the corresponding transfer restrictions described above included in this
Indenture and the Notes and with respect to shares of the Common Stock issuable upon conversion of
the Notes will be deemed to refer to such changed period, from and after receipt by the Trustee of
an Officers’ Certificate and Opinion of Counsel evidencing such changes. However, such changes will
not be made if they are otherwise prohibited by, or would otherwise cause a violation of, the
federal securities laws applicable at the time. As soon as practicable after the Company knows of
the effectiveness of any such amendment to change the two-year period under Rule 144(k), unless
such changes would otherwise be prohibited by, or would otherwise cause a violation of, the federal
securities laws applicable at the time, the Company will provide to the Trustee an Officers’
Certificate and Opinion of Counsel evidencing such changes as to the effectiveness of such
amendment and the effectiveness of such change to the restrictive legends and transfer
restrictions.

     (d) Any Restricted Securities, prior to the expiration of the holding period applicable to
sales thereof under Rule 144(k) under the Securities Act (or any successor provision), purchased or
owned by the Company or any Affiliate thereof may not be resold by the Company or such Affiliate
unless registered under the Securities Act or resold pursuant to an exemption from the registration
requirements of the Securities Act in a transaction which results in such Notes or Common Stock, as
the case may be, no longer being “restricted securities” (as defined under Rule 144).

     (e) The Trustee shall have no responsibility or obligation to any Agent Members or any other
Person with respect to the accuracy of the books or records, or the acts or omissions, of the
Depositary or its nominee or of any participant or member thereof, with respect to any ownership
interest in the Notes or with respect to the delivery to any Agent Member or other Person (other
than the Depositary) of any notice or the payment of any amount, under or with respect to such
Notes. All notices and communications to be given to the Holders of Notes and all payments to be
made to Holders of Notes under the Notes shall be given or made only to or upon the order of the
registered Holders of Notes (which shall be the Depositary or its nominee in the case of a Global
Note). The rights of beneficial owners in any Global Notes shall be exercised only through the
Depositary subject to the customary procedures of the Depositary. The Trustee may rely and shall
be fully protected in relying upon information furnished by the Depositary with respect to its
Agent Members.

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

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     SECTION 2.09 Replacement Notes. If a mutilated Note is surrendered to the Registrar or if
the Noteholder of a Note claims that the Note has been lost, destroyed or wrongfully taken, the
Company shall issue and the Trustee shall authenticate a replacement Note if the requirements of
Section 8-405 of the Uniform Commercial Code are met, such that the Noteholder (i) satisfies the
Company and the Trustee within a reasonable time after it has notice of such loss, destruction or
wrongful taking and the Registrar does not register a transfer prior to receiving such
notification, (ii) makes such request to the Company and the Trustee prior to the Note being
acquired by a protected purchaser as defined in Section 8-303 of the Uniform Commercial Code (a
“protected purchaser”) and (iii) satisfies any other reasonable requirements of the Trustee and the
Company. If required by the Trustee or the Company, such Noteholder shall furnish an indemnity
bond sufficient in the judgment of the Trustee to protect the Company, the Trustee, the Paying
Agent and the Registrar from any loss, liability and expense that any of them may suffer if a Note
is replaced and subsequently presented or claimed for payment. The Company and the Trustee may
charge the Noteholder for their expenses in replacing a Note. In case any Note which has matured or
is about to mature or has been properly tendered for repurchase on a Fundamental Change Repurchase
Date (and not withdrawn), as the case may be, or is to be converted into Common Stock, shall become
mutilated or be destroyed, lost or wrongfully taken, the Company may, 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 in connection with
such substitution, and, in every case of destruction, loss or wrongful taking, the applicant shall
also furnish to the Company, the Trustee and, if applicable, any Paying Agent or Conversion Agent
evidence to their satisfaction of the destruction, loss or wrongful taking of such Notes and of the
ownership thereof.

     Every replacement Note is an additional obligation of the Company.

     The provisions of this Section 2.09 are exclusive and shall preclude (to the extent lawful)
all other rights and remedies with respect to the replacement or payment of mutilated, lost,
destroyed or wrongfully taken Notes.

     SECTION 2.10 Outstanding Notes. Notes outstanding at any time are all Notes authenticated
by the Trustee except for those canceled by it, those delivered to it for cancellation and those
described in this Section as not outstanding. A Note does not cease to be outstanding because the
Company or an Affiliate of the Company holds the Note.

     If a Note is replaced pursuant to Section 2.09, it ceases to be outstanding unless the Trustee
and the Company receive proof satisfactory to them that the replaced Note is held by a protected
purchaser.

     If the Paying Agent holds in trust, in accordance with this Indenture, on the Business Day
immediately following a Fundamental Change Repurchase Date or on the Maturity Date money sufficient
to pay all principal and interest payable on that date with respect to the Notes (or

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portions thereof) to be repurchased or maturing, as the case may be, and the Paying Agent is
not prohibited from paying such money to the Noteholders on that date pursuant to the terms of this
Indenture, then on and after that date such Notes (or portions thereof) cease to be outstanding and
interest on them ceases to accrue.

     SECTION 2.11 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
the 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 and
thereupon any or all temporary Notes may be surrendered in exchange therefor, at each office or
agency maintained by the Company pursuant to Section 4.02 and the Trustee or such authenticating
agent shall authenticate and make available for delivery 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.

     SECTION 2.12 Cancellation. The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee any Notes surrendered
to them for registration of transfer, exchange or payment. The Trustee and no one else shall cancel
all Notes surrendered for registration of transfer, exchange, payment or cancellation and dispose
of such canceled Notes in accordance with its customary procedures or deliver canceled Notes to the
Company upon its request therefor. The Company may not issue new Notes to replace Notes it has paid
or delivered to the Trustee for cancellation. The Trustee shall not authenticate Notes in place of
canceled Notes other than pursuant to the terms of this Indenture.

     SECTION 2.13 CUSIP and ISIN Numbers. The Company in issuing the Notes may use “CUSIP” and
“ISIN” numbers (if then generally in use) and, if so, the Trustee shall use “CUSIP” and “ISIN”
numbers in all notices issued to Noteholders as a convenience to such Noteholders; provided,
however, 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 as contained in any notice and that reliance may be
placed only on the other identification numbers printed on the Notes. The Company shall promptly
notify the Trustee in writing of any changes to the CUSIP and ISIN numbers.

     SECTION 2.14 Additional Notes. The Company may, from time to time, subject to compliance
with any other applicable provisions of this Indenture, without the consent of the Noteholders,
create and issue pursuant to this Indenture additional Notes (“Additional Notes”)

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having terms and conditions set forth in Exhibit A identical to those of the other
outstanding Notes, except that Additional Notes may:

     (1) have a different Issue Date from the Issue Date for other outstanding Notes;

     (2) have a different issue price than other outstanding Notes; and

     (3) have terms specified in the Additional Notes Board Resolutions for such Additional Notes
making appropriate adjustments to this Article 2 and Exhibit A (and related definitions)
applicable to such Additional Notes in order to conform to and ensure compliance with the
Securities Act (or other applicable securities laws) and any registration rights or similar
agreement applicable to such Additional Notes, which are not adverse in any material respect to the
Holder of any outstanding Notes (other than such Additional Notes);

provided, that no adjustment pursuant to this Section 2.14 shall cause such Additional Notes to
constitute, as determined pursuant to an Opinion of Counsel, a different class of securities than
the Notes issued pursuant to the Purchase Agreement for U.S. federal income tax purposes; and
provided further, that the Additional Notes have the same CUSIP number as other outstanding Notes.
No Additional Notes may be issued if on the Issue Date therefor any Event of Default has occurred
and is continuing.

     In order to issue Additional Notes, the Notes originally issued pursuant to the Purchase
Agreement and any Additional Notes must be treated as a single class for all purposes under this
Indenture, including waivers, amendments, offers to purchase and, in the opinion of Counsel, United
States federal tax purposes.

     With respect to any issuance of Additional Notes, the Company shall deliver to the Trustee a
resolution of the Board of Directors and an Officers’ Certificate in respect of such Additional
Notes, which shall together provide the following information:

     (1) the aggregate principal amount of such Additional Notes to be authenticated and
delivered pursuant to this Indenture;

     (2) the Issue Date, issue price, pre-issuance accrued interest, amount of interest
payable on the first Interest Payment Date, first Interest Payment Date, CUSIP number and
corresponding ISIN of such Additional Notes; and

     (3) such matters as shall be applicable to such Additional Notes as described in clause
(3) of the preceding paragraph.

     SECTION 2.15 Share Cap Additional Interest. In the event that the Stockholder
Approval is not obtained on or before the 365th day after the Closing Date, the Company shall pay
additional interest (“Share Cap Additional Interest”) on the Notes in an amount equal to (i) 2.0%
per annum, from and including June 21, 2008 to June 21, 2009, (ii) 2.25% per annum from and
including June 22, 2009 to June 21, 2010, (iii) 2.5% per annum from and including June 22, 2010 to
June 21, 2011, (iv) 2.75% per annum from and including June 22, 2011 to June 15, 2012,

23

 

which Share Cap Additional Interest shall in each case continue to accrue until the date on
which the Company receives the Stockholder Approval.

     SECTION 2.16 Defaulted Interest. Any interest on any Note which is payable, but is not paid
when the same becomes due and payable and such nonpayment continues for a period of thirty (30)
calendar days, shall forthwith cease to be payable to the Holder on the Regular Record Date, and
such defaulted interest and interest (to the extent lawful) on such defaulted interest at the
annual rate borne by the Notes (such defaulted interest and interest thereon herein collectively
called “Defaulted Interest”) shall be paid by the Company at its election, in each case, as
provided in clause (a) or (b) below:

     (a) 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 (as defined below) for the payment of such Defaulted Interest, which shall be
fixed in the following manner. The Company shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each Note and the date (not less than thirty (30)
calendar days after such notice) of the proposed payment (the “Special Interest Payment Date”), and
at the same time the Company shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed
payment, such money when deposited to be held in trust for the benefit of the Persons entitled to
such Defaulted Interest as in this clause provided. Thereupon the Trustee shall fix a record date
(the “Special Record Date”) for the payment of such Defaulted Interest which shall be not more than
fifteen (15) calendar days and not less than ten (10) calendar days prior to the Special Interest
Payment Date and not less than ten (10) calendar days after the receipt by the Trustee of the
notice of the proposed payment. The Trustee shall promptly notify the Company of such Special
Record Date, and in the name and at the expense of the Company, shall promptly cause notice of the
proposed payment of such Defaulted Interest and the Special Record Date and Special Interest
Payment Date therefor to be given to each Noteholder, not less than ten (10) calendar days prior to
such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the
Special Record Date and Special Interest Payment Date therefor having been so given, such Defaulted
Interest shall be paid on the Special Interest Payment Date 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 (b).

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

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

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ARTICLE 3

REPURCHASE OF NOTES

     SECTION 3.01 Repurchase at Option of Holders Upon a Fundamental Change. (a) If there shall
occur a Fundamental Change at any time prior to maturity of the Notes, then each Holder of Notes
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, on a date
(the “Fundamental Change Repurchase Date”) specified by the Company, that is not less than 20
calendar days nor more than 35 calendar days after the date of the Company Repurchase Notice
related to such Fundamental Change at a cash repurchase price equal to 100% of the principal amount
of the Notes being repurchased, plus accrued and unpaid interest to, but excluding, the Fundamental
Change Repurchase Date, subject to the satisfaction by the Holder of the requirements set forth in
Section 3.01(c); provided that if such Fundamental Change Repurchase Date falls after a Regular
Record Date and on or prior to the corresponding
Interest Payment Date, then the interest payable on such Fundamental Change Repurchase Date shall
be paid on such Fundamental Change Repurchase Date to the Holders of record of the Notes on the
applicable Regular Record Date instead of the Holders surrendering the Notes for repurchase on such
date.

     (b) On or before the fifth calendar day after the occurrence of a Fundamental Change, the
Company shall provide to all Holders of record of the Notes on the date of the Fundamental Change
at their addresses shown in the Register (and to beneficial owners of the Notes to the extent
required by applicable law) a Company Repurchase Notice as set forth in Section 3.02 with respect
to such Fundamental Change. The Company shall also deliver a copy of the Company Repurchase Notice
to the Trustee and the Paying Agent at such time as it is mailed to Holders of Notes.

     No failure of the Company to give the foregoing notices and no defect therein shall limit the
repurchase rights of Holders of Notes or affect the validity of the proceedings for the repurchase
of the Notes pursuant to this Section 3.01.

     (c) For Notes to be repurchased at the option of the Holder, the Holder must deliver to the
Paying Agent, prior to 5:00 p.m., New York City time, on the Fundamental Change Repurchase Date,
(i) a written notice of repurchase (a “Repurchase Notice”) in the form set forth on the reverse of
the Notes duly completed (if the Notes are certificated) or stating the following (if the Notes are
represented by a Global Note): (A) the certificate number of the Notes which the Holder will
deliver to be repurchased or compliance with the appropriate Depositary procedures, (B) the portion
of the principal amount of the Notes which the Holder will deliver to be repurchased, which portion
must be in principal amounts of $1,000 or an integral multiple of $1,000 and (C) that such Notes
are to be repurchased by the Company pursuant to the terms and conditions specified in the Notes
and in this Indenture, together with (ii) such Notes duly endorsed for transfer (if the Notes are
certificated) or book-entry transfer of such Notes (if such Notes are represented by a Global
Note). The delivery of such Notes to the Paying Agent (together with all necessary endorsements)
at the office of the Paying Agent shall be a condition to the receipt by the Holder of the
repurchase price therefor; provided, however, that such repurchase price shall be so paid pursuant
to this Section 3.01 only if the Notes so delivered

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to the Paying Agent shall conform in all
respects to the description thereof in the Repurchase Notice. All questions as to the validity,
eligibility (including time of receipt) and acceptance of any Notes for repurchase shall be
determined by the Company, whose determination shall be final and binding absent manifest error.

     (d) The Company shall repurchase from the Holder thereof, pursuant to this Section 3.01, a
portion of a Note, if the principal amount of such portion is $1,000 or a whole multiple of $1,000.
Provisions of this Indenture that apply to the repurchase of all of a Note also apply to the
repurchase of such portion of such Note.

     (e) The Paying Agent shall promptly notify the Company of the receipt by it of any Repurchase
Notice or written notice of withdrawal thereof.

     Any repurchase by the Company contemplated pursuant to the provisions of this Section 3.01
shall be consummated by the delivery of the consideration to be received by the Holder
promptly following the later of the Fundamental Change Repurchase Date and the time of the
book-entry transfer or delivery of the Notes.

     SECTION 3.02 Company Repurchase Notice. In connection with any repurchase of Notes
pursuant to Section 3.01, the notice contemplated by such provision (the “Company Repurchase
Notice”) shall:

     (1) state the repurchase price and the Fundamental Change Repurchase Date to which the Company
Repurchase Notice relates;

     (2) state the circumstances constituting the Fundamental Change and the date of the
Fundamental Change;

     (3) state that the repurchase price will be paid in cash;

     (4) state that Holders must exercise their right to elect repurchase prior to 5:00 p.m., New
York City time, on the Fundamental Change Repurchase Date;

     (5) include a form of Repurchase Notice;

     (6) state the name and address of the Paying Agent;

     (7) state that Notes must be surrendered to the Paying Agent to collect the repurchase price;

     (8) state that a Holder may withdraw its Repurchase Notice in whole or in part at any time
prior to 5:00 p.m., New York City time, on the Fundamental Change Repurchase Date by delivering a
valid written notice of withdrawal in accordance with Section 3.03;

     (9) state whether the Notes are then convertible, and if so, the then applicable Conversion
Rate, and any adjustments to the applicable Conversion Rate resulting from the Fundamental Change
transaction and expected changes in the cash, shares or other property

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deliverable upon conversion
of the Notes as a result of the occurrence of the Fundamental Change;

     (10) state that Notes as to which a Repurchase Notice has been given may be converted only if
the Repurchase Notice is withdrawn in accordance with the terms of this Indenture;

     (11) state the amount of interest accrued and unpaid per $1,000 principal amount of Notes to,
but excluding, the Fundamental Change Repurchase Date; and

     (12) state the CUSIP number of the Notes.

     A Company Repurchase Notice may be given by the Company or, at the Company’s request in
writing, the Trustee shall give such Company Repurchase Notice in the Company’s
name and at the Company’s expense; provided, that the text of the Company Repurchase Notice
shall be prepared by the Company.

     The Company will, to the extent applicable, comply with the provisions of Rule 13e-4 and Rule
14e-1 (or any successor provision) and any other tender offer rules under the Exchange Act that may
be applicable at the time of the repurchase of the Notes, file the related Schedule TO (or any
successor schedule, form or report) under the Exchange Act and comply with all other federal and
state securities laws in connection with the repurchase of the Notes.

     SECTION 3.03 Effect of Repurchase Notice; Withdrawal. Upon receipt by the Paying Agent of
the Repurchase Notice specified in Section 3.01, the Holder of the Notes in respect of which such
Repurchase Notice was given shall (unless such Repurchase Notice is validly withdrawn in accordance
with the following paragraph) thereafter be entitled to receive solely the repurchase price with
respect to such Notes. Such repurchase price shall be paid to such Holder, subject to receipt of
funds and/or the Notes by the Paying Agent, promptly following the later of (x) the Fundamental
Change Repurchase Date with respect to such Notes (provided the Holder has satisfied the conditions
in Section 3.01) and (y) the time of book-entry transfer or delivery of such Notes to the Paying
Agent by the Holder thereof in the manner required by Section 3.01. The Notes in respect of which
a Repurchase Notice has been given by the Holder thereof may not be converted pursuant to Article
10 hereof on or after the date of the delivery of such Repurchase Notice unless such Repurchase
Notice has first been validly withdrawn.

     A Repurchase Notice may be withdrawn in whole or in part by means of a written notice of
withdrawal delivered to the office of the Paying Agent in accordance with the Repurchase Notice at
any time prior to 5:00 p.m., New York City time, on the Fundamental Change Repurchase Date
specifying:

     (a) the certificate number, if any, of the Note in respect of which such notice of withdrawal
is being submitted, or the appropriate Depositary information, in accordance with appropriate
Depositary procedures, if the Note in respect of which such notice of withdrawal is being submitted
is represented by a Global Note,

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

     (c) the principal amount, if any, of such Notes which remains subject to the original
Repurchase Notice and which has been or will be delivered for repurchase by the Company.

     If a Repurchase Notice is properly withdrawn, the Company shall not be obligated to repurchase
the Notes listed in such Repurchase Notice.

     SECTION 3.04 Deposit of Repurchase Price. Prior to 11:00 a.m., New York City Time, on the
Business Day immediately following the Fundamental Change Repurchase Date, the Company shall
deposit with the Paying Agent or, if
the Company or a Wholly Owned Subsidiary of the Company is acting as the Paying Agent, shall
segregate and hold in trust as provided in Section 6.04, an amount of cash (in immediately
available funds if deposited on the Fundamental Change Repurchase Date), sufficient to pay the
aggregate repurchase price of all the Notes or portions thereof that are to be repurchased as of
the Fundamental Change Repurchase Date.

     If on the Business Day immediately following the Fundamental Change Repurchase Date the Paying
Agent holds cash sufficient to pay the repurchase price of the Notes that Holders have elected to
require the Company to repurchase in accordance with Section 3.01, then, as of the Fundamental
Change Repurchase Date, such Notes will cease to be outstanding, interest will cease to accrue and
all other rights of the Holders of such Notes will terminate, other than the right to receive the
repurchase price upon delivery or book-entry transfer of the Notes. This will be the case whether
or not book-entry transfer of the Notes has been made or the Notes have been delivered to the
Paying Agent.

     SECTION 3.05 Notes Repurchased in Part. Upon presentation of any Notes repurchased only in
part, the Company shall execute and the Trustee shall authenticate and make available for delivery
to the Holder thereof, at the expense of the Company, a new Note or Notes, of any authorized
denomination, in aggregate principal amount equal to the unrepurchased portion of the Notes
presented.

ARTICLE 4

COVENANTS

     SECTION 4.01 Payment of Notes. The Company shall promptly pay the principal of and interest
on the Notes on the dates and in the manner provided in the Notes and in this Indenture. Principal
and interest shall be considered paid on the date due if on such date the Trustee or the Paying
Agent holds in accordance with this Indenture money sufficient to pay all principal and interest
then due and the Trustee or the Paying Agent, as the case may be, is not prohibited from paying
such money to the Noteholders on that date pursuant to the terms of this Indenture.

     The Company shall pay interest on overdue principal at the rate specified therefor in the
Notes, and it shall pay interest on overdue installments of interest at the same rate to the extent
lawful.

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     SECTION 4.02 Maintenance of Office or Agency. The Company will maintain an office or agency
in the Borough of Manhattan, The City of New York, where the Notes may be surrendered for
registration of transfer or exchange or for presentation for payment or for conversion or
repurchase and where notices and demands to or upon the Company in respect of the Notes and this
Indenture may be served. As of the date of this Indenture, such office is located at the office of
the Trustee located at 100 Wall Street, Suite 1600, EX-NY-WALL, New York, New York 10005 and, at
any other time, at such other address as the Trustee may designate from time to time by notice to
the Company. 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.

     The Company may also from time to time designate co-registrars and one or more 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. 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.

     So long as the Trustee is the Registrar, the Trustee agrees to mail, or cause to be mailed,
the notices set forth in Section 7.08. If co-registrars have been appointed in accordance with
this Section, the Trustee shall mail such notices only to the Company and the Holders of Notes it
can identify from its records.

     SECTION 4.03 144A Information. The Company covenants and agrees that it shall, during any
period in which it is not required to file with the SEC reports pursuant to Section 13 or 15(d)
under the Exchange Act, make available to any Holder or beneficial owner of Notes or holder or
beneficial owner of any Common Stock (collectively, for purposes of this Section 4.03, “holder”)
issued upon conversion thereof which continue to be Restricted Securities and any prospective
purchaser of Notes or such Common Stock designated by such holder, the information, if any,
required pursuant to Rule 144A(d)(4) under the Securities Act upon the request of any holder of the
Notes or such Common Stock, until such time as such securities are no longer “restricted
securities” within the meaning of Rule 144 under the Securities Act, assuming such securities have
not been owned by Affiliate of the Company.

     SECTION 4.04 Existence. Except in compliance with Article V, the Company will do or cause
to be done all things necessary to preserve and keep in full force and effect its existence and
rights (charter and statutory); provided that the Company shall not be required to preserve any
such right if the Company shall determine that the preservation thereof is no longer desirable in
the conduct of the business of the Company and that the loss thereof is not disadvantageous in any
material respect to the Holders of Notes.

     SECTION 4.05 Compliance Certificate(a) . The Company shall deliver to the Trustee
within 120 calendar days after the end of each Fiscal Year of the Company a certificate of the
principal executive officer, principal financial officer or principal accounting officer of the

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Company, stating whether or not, to the knowledge of such officer, any Default or Event of Default
occurred during such period and if so, describing each Default or Event of Default, its status and
the action the Company is taking or proposes to take with respect thereto. The Company also shall
comply with Section 314(a)(4)
of the Trust Indenture Act. Except with respect to receipt of Note payments when due and any
Default or Event of Default information contained in the Officer’s Certificate delivered to it
pursuant to this Section 4.05, the Trustee shall have no duty to review, ascertain or confirm the
Company’s compliance with, or the breach of any representation, warranty or covenant made in this
Indenture.

     SECTION 4.06 Further Instruments and Acts. The Company shall execute and deliver such
further instruments and do such further acts as may be reasonably necessary or proper to carry out
more effectively the purpose of this Indenture.

     SECTION 4.07 Additional Interest Notice. In the event that the Company is required to pay
any Additional Interest, any Reporting Additional Interest or any Share Cap Additional Interest, as
applicable, to Holders of Notes, the Company will provide written notice to the Trustee of its
obligation to pay Additional Interest, Reporting Additional Interest or Share Cap Additional
Interest, as the case may be, no later than two calendar days prior to the relevant Interest
Payment Date for Additional Interest, Reporting Additional Interest or Share Cap Additional
Interest, as the case may be, and such notice shall set forth the amount of Additional Interest,
Reporting Additional Interest or Share Cap Additional Interest, as the case may be, to be paid by
the Company on such Interest Payment Date. The Trustee shall not at any time be under any duty or
responsibility to any Holder of Notes to determine the Additional Interest, Reporting Additional
Interest or Share Cap Additional Interest, as the case may be, or with respect to the nature,
extent or calculation of the amount of Additional Interest, Reporting Additional Interest or Share
Cap Additional Interest, as the case may be, when made, or with respect to the method employed in
such calculation of the Additional Interest, Reporting Additional Interest or Share Cap Additional
Interest, as the case may be.

     SECTION 4.08 Reporting Obligation. (a) The Company shall deliver to the Trustee, within 15
calendar days after the Company has filed with the SEC, copies of its annual reports and of
information, documents and other reports (or copies of such portions of any of the foregoing as the
SEC may by rules and regulations prescribe) which the Company is required to file with the SEC
pursuant to Section 13 or 15(d) of the Exchange Act. The Company shall also comply with the other
applicable provisions of Section 314(a)(1) of the TIA.

     (b) Delivery of reports, information and other documents under this Section 4.08 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 rely exclusively on Officers’ Certificates). The Trustee is under no duty
to examine such reports, information or documents to ensure compliance with the provisions of this
Indenture or to ascertain the correctness or otherwise of
the information or the statements contained therein. The Trustee is entitled to assume such
compliance and correctness unless a responsible officer of the Trustee is informed otherwise.

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     SECTION 4.09 Covenant to Obtain Stockholder Approval. (a) The Company hereby agrees to use
its reasonable best efforts to seek Stockholder Approval on or prior to the date that is 365
calendar days after the Closing Date. In the event that the Company receives Stockholder Approval,
the Company shall promptly provide written notice to the Trustee thereof. Notwithstanding any
other provision of this Indenture, the sole remedy for the failure by the Company to receive
Stockholder Approval shall be the payment of Share Cap Additional Interest as provided in Section
2.15.

     (b) Notwithstanding the foregoing, nothing contained herein shall preclude the Company from
satisfying its obligations in respect of the conversion of the Notes by delivery of purchased
shares of Common Stock which are then held in the treasury of the Company.

     SECTION 4.10 Incurrence of Indebtedness. The Company shall not permit VeriFone, Inc.,
directly or indirectly, to incur or guarantee any unsecured indebtedness in excess of $20,000,000
in the aggregate, unless prior to or concurrently with such incurrence or guarantee, VeriFone, Inc.
guarantees the Notes on an equal and ratable basis.

ARTICLE 5

SUCCESSOR COMPANY

     SECTION 5.01 When Company May Merge or Transfer Assets. The Company shall not, in a single
transaction or a series of related transactions, consolidate with or merge with or into any other
Person, or sell, convey, transfer or lease the Company’s property and assets substantially as an
entirety to another Person unless:

     (a) either (i) the Company is the continuing corporation, or (ii) the resulting, surviving or
transferee Person (if other than the Company) is a corporation or limited liability company
organized and existing under the laws of the United States, any state thereof or the District of
Columbia and such Person assumes, by a supplemental indenture, all of the Company’s obligations
under the Notes and this Indenture, and, to the extent then operative, by a supplemental agreement,
all of the Company’s obligations under each Registration Rights Agreement, in each case in a form
reasonably satisfactory to the Trustee;

     (b) immediately after giving effect to the transaction described above, no Default or Event of
Default, has occurred and is continuing;

     (c) if as a result of such transaction the Notes become convertible into common stock or other
securities issued by any Person other than the Company or the resulting, surviving or
transferee Person, such other Person fully and unconditionally guarantees all obligations of
the Company or the resulting, surviving or transferee Person (if other than the Company), as
applicable, under the Notes and this Indenture and, to the extent then operative, each Registration
Rights Agreement; and

     (d) the Company has delivered to the Trustee the Officers’ Certificate and Opinion of Counsel
pursuant to Section 5.03.

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     SECTION 5.02 Successor to be Substituted. In case of any such consolidation, merger, sale,
conveyance, transfer or lease in which the Company is not the continuing corporation and upon the
assumption by the successor Person, by supplemental indenture, executed and delivered to the
Trustee and reasonably satisfactory in form and substance to the Trustee, of the due and punctual
payment of the principal of and interest on all of the Notes, and the due and punctual performance
and observance of all of the covenants and conditions of this Indenture to be performed or
satisfied by the Company, and, to the extent then operative, by supplemental agreement, executed
and delivered to the Trustee and reasonably satisfactory in form and substance to the Trustee, of
all of the obligations of the Company under each Registration Rights Agreement, such successor
Person shall succeed to, and be substituted for, the Company, and may exercise every right and
power of the Company with the same effect as if it had been named herein as the party of this first
part, and the Company shall be discharged from its obligations under the Notes, this Indenture and
each Registration Rights Agreement. Such successor Person thereupon may cause to be signed, and
may issue either in its own name or in the name of VeriFone Holdings, Inc. any or all of the Notes,
issuable hereunder that theretofore shall not have been signed by the Company and delivered to the
Trustee; and, upon the order of such successor Person 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 that previously shall have
been signed and delivered by the officers of the Company to the Trustee for authentication, and any
Notes that such successor Person 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, sale, conveyance, transfer or lease, upon
compliance with this Article 5 the Person named as the “Company” in the first paragraph of this
Indenture or any successor that shall thereafter have become such in the manner prescribed in this
Article 5 may be dissolved, wound up and liquidated at any time thereafter and such Person shall be
discharged from its liabilities as obligor and maker of the Notes and from its obligations under
this Indenture.

     SECTION 5.03 Opinion of Counsel to be Given Trustee. Prior to execution of any supplemental
indenture pursuant to this Article 5, the Trustee shall be provided with an Officers’ Certificate
and an Opinion of Counsel as conclusive evidence that any such consolidation, merger, sale,
conveyance, transfer or lease and any such assumption complies with the provisions of this Article
5.

ARTICLE 6

DEFAULTS AND REMEDIES

     SECTION 6.01 Events of Default. An “Event of Default” occurs if:

     (a) the Company defaults in any payment of interest on any Note when the same becomes due and
payable and such default continues for a period of 30 calendar days;

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     (b) the Company defaults in the payment of the principal of any Note when the same becomes due
and payable at its Stated Maturity, upon declaration or otherwise or upon required repurchase;

     (c) the Company fails to deliver cash and, if applicable, Common Stock, as required pursuant
to Article 10 upon the conversion of any Notes and such failure continues for five days following
the scheduled settlement date for such conversion;

     (d) the Company fails to comply in any material respect with its notice obligations regarding
the anticipated effective date or actual effective date of a Fundamental Change as required by
Section 3.01 or 10.01 hereof;

     (e) the Company fails to perform or observe any other term, covenant or agreement in the Notes
or this Indenture (other than those referred to in (a), (b), (c), or (d) above) and such failure
continues for 60 calendar days after the notice specified below;

     (f) a failure to pay when due, whether at Stated Maturity or otherwise, or a default that
results in the acceleration of maturity, of any indebtedness for borrowed money of the Company or
any Significant Subsidiary in an aggregate amount in excess of $25,000,000 (or its foreign currency
equivalent), unless such indebtedness is discharged, or such acceleration is rescinded, stayed or
annulled, within a period of 30 calendar days after the notice specified below; or

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

     (1) commences a voluntary case;

     (2) consents to the entry of an order for relief against it in an involuntary case;

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

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

     (5) or takes any comparable action under any foreign laws relating to insolvency; or

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

     (1) is for relief against the Company or any Significant Subsidiary in an involuntary
case;

     (2) appoints a Custodian of the Company or any Significant Subsidiary or for any
substantial part of its property;

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     (3) orders the winding up or liquidation of the Company or any Significant Subsidiary;
or

     (4) any similar relief is granted under any foreign laws and the order or decree
remains unstayed and in effect for 60 calendar days.

     The foregoing shall constitute Events of Default whatever the reason for any such Event of
Default and whether it is voluntary or involuntary or is 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.

     The term “Bankruptcy Law” means Title 11, United States Code, or any similar Federal or state
law for the relief of debtors. The term “Custodian” means any receiver, trustee, assignee,
liquidator, custodian or similar official under any Bankruptcy Law.

     A Default under clause (e) or (f) above is not an Event of Default until the Trustee notifies
the Company, or the Noteholders of at least 25% in aggregate principal amount of the outstanding
Notes notify the Company and the Trustee, of the Default and the Company does not cure such Default
within the time specified in such clause (e) or (f) after receipt of such notice. Such notice must
specify the Default, demand that it be remedied and state that such notice is a “Notice of
Default”.

     The Company shall deliver to the Trustee, promptly upon becoming aware of the occurrence
thereof, written notice in the form of an Officers’ Certificate of any Default, its status and what
action the Company is taking or proposes to take with respect thereto.

     SECTION 6.02 Acceleration. Subject to Section 6.13, if an Event of Default (other than an
Event of Default specified in Section 6.01(h)) occurs and is continuing, the Trustee by notice to
the Company, or the Noteholders of at least 25% in aggregate principal amount of the outstanding
Notes by notice to the Company, may declare the principal of and accrued but unpaid interest on all
the Notes to be due and payable. Upon such a declaration, such principal and interest shall be due
and payable immediately. If an Event of Default specified in Section 6.01(h) occurs, the principal
of and interest on all the Notes shall become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any Noteholders.

     At any time after such a declaration of acceleration with respect to the Notes has been made
or occurred and before a judgment or decree for payment of money due has been obtained by the
Trustee, the Noteholders of a majority in aggregate principal amount of the Notes by written notice
to the Company and the Trustee may rescind and annul such declaration and its consequences
(including votes for or consents to such a rescission obtained in connection with a purchase of, or
tender offer or exchange offer for, Notes) if:

     (i) the Company has paid (or deposited with the Trustee a sum sufficient to pay) (A)
all Defaulted Interest or interest that is otherwise overdue on all Notes, (B) the principal
amount of any Notes that have become due otherwise than by such acceleration, (C) to the
extent that payment of such interest is lawful, interest upon overdue interest,

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and (D) all
sums paid or advanced by the Trustee under this Indenture and the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel; and

     (ii) all Events of Default have been cured or waived except nonpayment of principal or
accrued and unpaid interest that has become due solely because of acceleration.

No such rescission shall affect any subsequent Default or impair any right consequent thereto.

     SECTION 6.03 Other Remedies. If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy to collect the payment of principal of or interest on the Notes or
to enforce the performance of any provision of the Notes or this Indenture.

     The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not
produce any of them in the proceeding. A delay or omission by the Trustee or any Noteholder in
exercising any right or remedy accruing upon an Event of Default shall not impair the right or
remedy or constitute a waiver of or acquiescence in the Event of Default. No remedy is exclusive of
any other remedy. All available remedies are cumulative.

     SECTION 6.04 Waiver of Past Defaults. The Holders of a majority in aggregate principal
amount of the Notes then outstanding, on behalf of the Noteholders, by notice to the Trustee may
waive any past Default or Event of Default and its consequences (including votes for or consents to
such a waiver obtained in connection with a purchase of, or tender offer or exchange offer for,
Notes) except:

     (i) a Default in the payment of the principal of or interest on a Note;

     (ii) a Default arising from the failure of the Company to convert any Notes to cash
and, if applicable, Common Stock pursuant to the terms of this Indenture;

     (iii) a Default arising from the failure to repurchase any Note when required pursuant
to the terms of this Indenture; or

     (iv) a Default in respect of a provision that under Section 9.02 would require the
consent of each Noteholder affected.

When a Default is waived, it is deemed cured.

     SECTION 6.05 Control by Majority. The Noteholders of a majority in aggregate principal
amount of the outstanding Notes may direct the time, method and place of conducting any proceedings
for any remedy available to the Trustee or of exercising any trust or power conferred on the
Trustee. However, the Trustee may refuse to follow any direction that conflicts with law or this
Indenture or, subject to Section 7.01, that the Trustee determines is unduly prejudicial to the
rights of other Noteholders or would involve the Trustee in personal liability or expense that is
not adequately indemnified in the judgment of the Trustee; provided, however, that the Trustee may
take any other action deemed proper by the Trustee that is not inconsistent

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with such direction.
Prior to taking any action hereunder, the Trustee shall be entitled to indemnification satisfactory
to it in its sole discretion against all losses and expenses caused by taking or not taking such
action.

     SECTION 6.06 Limitation on Suits. Except to enforce the right to receive payment of
principal or interest when due, no Noteholder may pursue any remedy with respect to this Indenture
or the Notes unless:

     (a) the Noteholder gives to the Trustee written notice stating that an Event of Default is
continuing;

     (b) the Noteholders of at least 25% in aggregate principal amount of the outstanding Notes
make a written request to the Trustee to pursue the remedy;

     (c) such Noteholder or Noteholders offer to the Trustee security or indemnity reasonably
satisfactory to it against any costs, liability or expense of the Trustee;

     (d) the Trustee fails to comply with the request within 60 calendar days after receipt of the
request and the offer of security or indemnity; and

     (e) the Noteholders of a majority in aggregate principal amount of the outstanding Notes do
not give the Trustee a direction inconsistent with the request during such 60-calendar day period.

A Noteholder may not use this Indenture to prejudice the rights of another Noteholder or to obtain
a preference or priority over another Noteholder.

     SECTION 6.07 Rights of Noteholders to Receive Payment. Notwithstanding any other provision
of this Indenture, the right of any Noteholder to receive payment of principal of and interest on
the Notes held by such Noteholder, on or after the respective due dates expressed in the Notes, or
to convert such Note in accordance with Article
10, or to bring suit for the enforcement of any such payment or right to convert on or after such
respective dates, shall not be impaired or affected without the consent of such Noteholder.

     SECTION 6.08 Collection Suit by Trustee. If an Event of Default specified in Section
6.01(a) or (b) occurs and is continuing, the Trustee may recover judgment in its own name and as
trustee of an express trust against the Company for the whole amount then due and owing (together
with interest on any unpaid interest to the extent lawful) and the amounts provided for in Section
7.07.

     SECTION 6.09 Trustee May File Proofs of Claim. The Trustee may file such proofs of claim
and other papers or documents as may be necessary or advisable in order to have the claims of the
Trustee and the Noteholders allowed in any judicial proceedings relative to the Company, its
creditors or its property and, unless prohibited by law or applicable regulations, may vote on
behalf of the Noteholders in any election of a trustee in bankruptcy or other Person performing
similar functions, and any Custodian in any such judicial proceeding is hereby authorized by each
Noteholder to make payments to the Trustee and, in the event that the Trustee

36

 

shall consent to the
making of such payments directly to the Noteholders, to pay to the Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and
its counsel, and any other amounts due the Trustee under Section 7.07.

     SECTION 6.10 Priorities. If the Trustee collects any money or property pursuant to this
Article 6, it shall pay out the money or property in the following order:

     FIRST: to the Trustee for amounts due under Section 7.07;

     SECOND: to Noteholders for amounts due and unpaid on the Notes for principal and interest,
ratably without preference or priority of any kind, according to the amounts due and payable on the
Notes for principal and interest, respectively; and

     THIRD: to the Company.

     The Trustee may fix a record date and payment date for any payment to Noteholders pursuant to
this Section. At least 15 calendar days before such record date, the Trustee shall mail to each
Noteholder and the Company a notice that states the record date, the payment date and amount to be
paid.

     SECTION 6.11 Undertaking for Costs. 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, a court in its discretion may require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys’ fees and
expenses, against any party litigant in the suit, having due regard to the merits and good faith of
the claims or defenses made by the party litigant. This Section does not apply to a suit by the
Trustee, or a suit by Noteholders of more than 10% in aggregate principal amount of the Notes or to
any suit instituted by any Holder of Notes for the enforcement of the payment of the principal of
or interest on any Notes on or after the due date expressed in such Notes or to any suit for the
enforcement of the right to convert any Notes in accordance with the provisions of Article 10.

     SECTION 6.12 Waiver of Stay, Extension or Usury Laws. The Company shall not at any time
insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any
stay, extension or usury law wherever enacted, now or at any time hereafter in force, which may
affect the covenants or the performance of this Indenture; and the Company hereby expressly waives
all benefit or advantage of any such law, and shall not hinder, delay or impede the execution of
any power herein granted to the Trustee, but shall suffer and permit the execution of every such
power as though no such law had been enacted.

     SECTION 6.13 Sole Remedy for Failure to Report. Notwithstanding any other provision of this
Indenture, the Company may elect by written notice to the Trustee that the sole remedy for an Event
of Default relating to the failure of the Company to comply with its agreements under Section
4.08(a) of this Indenture or the requirements of Section 314(a)(1) of the TIA will for the 365
calendar days after the occurrence of such an Event of Default consist exclusively of the right to
receive additional interest (“Reporting Additional Interest”) on the principal amount of the Notes
at a rate equal to 0.25% per annum for the first 180 calendar days

37

 

after the occurrence of such an
Event of Default and 0.50% per annum from the 181st calendar day until the 365th day after the
occurrence of such an Event of Default. Such Reporting Additional Interest shall be payable in the
same manner and on the same Interest Payment Dates and subject to the same terms as other interest
payable under this Indenture. Reporting Additional Interest shall accrue on all outstanding Notes
from and including the date on which such Event of Default relating to a failure to comply with
Section 4.08(a) first occurs to but not including the 365th calendar day thereafter (or such
earlier date on which the Event of Default relating to a failure to comply with Section 4.08(a)
shall have been cured or waived). On such 365th calendar day (or such earlier date on which the
Event of Default relating to a failure to comply with Section 4.08(a) shall have been cured or
waived), such Reporting Additional Interest shall cease to accrue and on such 365th calendar day
the Notes shall be subject to acceleration and other remedies as provided in this Article 6 if the
Event of Default is continuing. For the avoidance of doubt, the provisions of this Section 6.13
shall not affect the rights of Holders of Notes in the event of the occurrence of any other Event
of Default and shall have no effect on the rights of Holders of Notes under each Registration
Rights Agreement. In the event the Company does not elect to pay Reporting Additional Interest
upon an Event of Default relating to failure to comply with Section 4.08(a), the Notes shall be
subject to acceleration as provided in Section 6.02. For the further avoidance of doubt, the
Reporting Additional Interest shall not begin accruing until the Company fails to comply with
Section 4.08(a) for a period of 60 calendar days after written notice of such failure is given to
the Company by the Trustee or to the Company and the Trustee by the Holder of at least 25% in
aggregate principal amount of outstanding Notes.

ARTICLE 7

TRUSTEE

     SECTION 7.01 Duties of Trustee. (a) If an Event of Default has occurred and is continuing,
the Trustee shall exercise the rights and powers vested in it by this Indenture and use the same
degree of care and skill in its exercise as a prudent Person would exercise or use under the
circumstances in the conduct of such Person’s own affairs.

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

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

     (2) in the absence of bad faith on its part, the Trustee may conclusively rely, as to
the truth of the statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and conforming to the requirements of this
Indenture. However, in the case of certificates or opinions specifically required by any
provision hereof to be furnished to it, the Trustee shall examine the certificates and
opinions 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).

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     (c) The Trustee may not be relieved from liability for its own negligent action, its own
negligent failure to act or its own willful misconduct, except that the Trustee shall not be liable
with respect to any action it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.

     (d) In no event shall the Trustee be responsible or liable for any failure or delay in the
performance of its obligations hereunder arising out of or caused by, directly or indirectly,
forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts
of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of
God, and interruptions, loss or malfunctions of utilities, communications or computer (software and
hardware) services; it being understood that the Trustee shall use reasonable efforts which are
consistent with accepted practices in the banking industry to resume performance as soon as
practicable under the circumstances.

     (e) The Trustee shall not be liable for interest on any money received by it except as the
Trustee may agree in writing with the Company.

     (f) Money held in trust by the Trustee need not be segregated from other funds except to the
extent required by law.

     (g) In no event shall the Trustee be responsible or liable for special, indirect, or
consequential loss or damage of any kind whatsoever (including, but not limited to, loss of
profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or
damage and regardless of the form of action.

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

     (i) The Trustee will not be liable for any error of judgment made in good faith by a
responsible officer, unless it is proved that the Trustee was negligent in ascertaining the
pertinent facts.

     (j) 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 and to the
provisions of the TIA.

     (k) No later than 1:00 p.m., New York City time, on the Trading Day after the Conversion Agent
receives a Conversion Notice that has been validly tendered in accordance with Section 10.02, the
Trustee shall deliver a notice stating (a) the number of options under the applicable convertible
bond hedge transaction that will be exercised equal to (i) the aggregate principal amount of Notes
that are being tendered for conversion pursuant to such Conversion Notice divided by (ii) $2,000,
(b) the scheduled commencement date of the Conversion Period relating to such Conversion Notice,
and (c) the anticipated date that the Conversion Settlement

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Amount relating to such Conversion
Notice will be delivered in accordance with Section 10.11 to converting Holders by facsimile or by
hand to:

Lehman Brothers Inc., acting as Agent

Lehman Brothers OTC Derivatives Inc., acting as Principal

745 Seventh Avenue

New York, NY 10019

Andrew Yare — Transaction Management Group

Facsimile No.: (646) 885-9546

and;

JPMorgan Chase Bank, National Association

277 Park Avenue, 11th Floor

New York, NY 10172

Attention: Eric Stefanik

Title: Operations Analyst

EDG Corporate Marketing

Facsimile No.: (212) 622-8534

The Trustee shall not have any liability to the Company or any other Person as a result of its
failure to deliver such notice.

     SECTION 7.02 Rights of Trustee. (a) The Trustee may conclusively rely on any document
believed by it to be genuine and to have been signed or presented by the proper person. The Trustee
need not investigate any fact or matter stated in the document.

     (b) Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate
or an Opinion of Counsel. The Trustee shall not be liable for any action it takes or omits to take
in good faith in reliance on the Officers’ Certificate or Opinion of Counsel.

     (c) The Trustee may act through agents and shall not be responsible for the misconduct or
negligence of any agent appointed with due care.

     (d) The Trustee shall not be liable for any action it takes or omits to take in good faith
which it believes to be authorized or within its rights or powers.

     (e) The Trustee may consult with counsel, and the advice or opinion of counsel with respect to
legal matters relating to this Indenture and the Notes shall be full and complete authorization and
protection from liability in respect to any action taken, omitted or suffered by it hereunder in
good faith and in accordance with the advice or opinion of such counsel.

     (f) The Trustee shall not be bound to make any investigation into the facts or matters stated
in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent,
order, approval, bond, debenture, note 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

40

 

fit at the expense of the Company and shall incur no liability of any kind by reason of such
inquiry or investigation.

     (g) 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.

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

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

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

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

     SECTION 7.03 Individual Rights of Trustee. The Trustee in its individual or any other
capacity may become the owner or pledgee of Notes and may otherwise deal with the Company or its
Affiliates with the same rights it would have if it were not Trustee. Any Conversion Agent, Paying
Agent, Registrar or co-paying agent may do the same with like rights. However, the Trustee must
comply with Sections 7.10 and 7.11.

     SECTION 7.04 Trustee’s Disclaimer. The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company’s use of the proceeds from the Notes, and it shall not be responsible
for any statement of the Company in this Indenture or in any document issued in connection with the
sale of the Notes or in the Notes other than the Trustee’s certificate of authentication.

     SECTION 7.05 Notice of Defaults. (a) The Trustee shall not be deemed to have notice of any
Default, other than a payment default, unless a Trust Officer shall have been advised in writing
that a Default has occurred. No duty imposed upon the Trustee in this Indenture shall be applicable
with respect to any Default of which the Trustee is not deemed to have notice.

     (b) If a Default occurs and is continuing and if it is known to the Trustee, the Trustee shall
mail to each Noteholder notice of the Default within 90 calendar days after it is known to a

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Trust
Officer or written notice of it is received by the Trustee. Except in the case of a Default in
payment of principal or interest on any Note, the Trustee may withhold notice if and so long as a
committee of its Trust Officers in good faith determines that withholding notice is in the
interests of the Noteholders.

     SECTION 7.06 Reports by Trustee to Noteholders. As promptly as practicable after each
October 15, beginning with October 15, 2007, and in any event prior to December 31 in each
subsequent year, the Trustee shall, to the extent that any of the events described in TIA § 313(a)
occurred within the previous twelve months, but not otherwise, mail to each Noteholder a brief
report dated as of October 15 that complies with Section 313(a) of the TIA. The Trustee shall also
comply with Section 313(b) of the TIA.

     A copy of each report at the time of its mailing to Noteholders shall be filed with the SEC
and each stock exchange (if any) on which the Notes are listed. The Company agrees to notify
promptly the Trustee, in writing, whenever the Notes become listed on any stock exchange and of any
delisting thereof.

     SECTION 7.07 Compensation and Indemnity. The Company shall pay to the Trustee from time to time such compensation as the Company and the
Trustee shall from time to time agree in writing. The Trustee’s compensation shall not be limited
by any law on compensation of a trustee of an express trust. The Company shall reimburse the
Trustee upon request for all reasonable out-of-pocket expenses incurred or made by it, including
costs of collection, in addition to the compensation for its services. Such expenses shall include
the reasonable compensation and expenses, disbursements and advances of the Trustee’s agents,
counsel, accountants and experts. The Company shall indemnify the Trustee, and hold it harmless,
against any and all loss, claim, damage, liability or expense (including reasonable attorneys’ fees
and expenses) incurred by or in connection with the offer and sale of the Notes or the
administration of this trust and the performance of its duties hereunder. The Trustee shall notify
the Company of any claim for which it may seek indemnity promptly upon obtaining actual knowledge
thereof; provided, however, that any failure so to notify the Company shall not relieve the Company
of its indemnity obligations hereunder. The Company shall defend the claim and the indemnified
party shall provide reasonable cooperation at the Company’s expense in the defense. Such
indemnified parties may have separate counsel and the Company shall pay the fees and expenses of
such counsel; provided, however, that the Company shall not be required to pay such fees and
expenses if it assumes such indemnified parties’ defense and, in such indemnified parties’
reasonable judgment, there is no conflict of interest between the Company and such parties in
connection with such defense. The Company need not reimburse any expense or indemnify against any
loss, liability or expense incurred by an indemnified party determined to have been caused by such
party’s own willful misconduct and negligence.

     To secure the Company’s payment obligations in this Section, the Trustee shall have a lien
prior to the Notes on all money or property held or collected by the Trustee other than money or
property held in trust to pay principal of and interest on particular Notes.

     The Company’s payment obligations pursuant to this Section shall survive the satisfaction or
discharge of this Indenture, any rejection or termination of this Indenture under

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any bankruptcy
law or the resignation or removal of the Trustee. When the Trustee incurs expenses after the
occurrence of a Default specified in Section 6.01(g) or (h) with respect to the Company, the
expenses are intended to constitute expenses of administration under the Bankruptcy Law.

     SECTION 7.08 Replacement of Trustee. The Trustee may resign at any time by so notifying the
Company. The Holders of a majority in aggregate principal amount of the Notes may remove the
Trustee by so notifying the Trustee and may appoint a successor Trustee. The Company shall remove
the Trustee if:

     (a) the Trustee fails to comply with Section 7.10;

     (b) the Trustee is adjudged bankrupt or insolvent;

     (c) a receiver or other public officer takes charge of the Trustee or its property; or

     (d) the Trustee otherwise becomes incapable of acting.

     If the Trustee resigns, is removed by the Company or by the Holders of a majority in aggregate
principal amount of the Notes and such Noteholders do not reasonably promptly appoint a successor
Trustee, or if a vacancy exists in the office of Trustee for any reason (the Trustee in such event
being referred to herein as the retiring Trustee), the Company shall promptly appoint a successor
Trustee.

     A successor Trustee shall deliver a written acceptance of its appointment to the retiring
Trustee and to the Company. Thereupon the resignation or removal of the retiring Trustee shall
become effective, and the successor Trustee shall have all the rights, powers and duties of the
Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to
Noteholders. The retiring Trustee shall promptly transfer all property held by it as Trustee to
the successor Trustee, subject to the lien provided for in Section 7.07.

     If a successor Trustee does not take office within 60 calendar days after the retiring Trustee
resigns or is removed, the retiring Trustee or the Holders of 10% in aggregate principal amount of
the Notes may petition any court of competent jurisdiction for the appointment of a successor
Trustee.

     If the Trustee fails to comply with Section 7.10, any Noteholder may petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

     Notwithstanding the replacement of the Trustee pursuant to this Section, the Company’s
obligations under Section 7.07 shall continue for the benefit of the retiring Trustee.

     SECTION 7.09 Successor Trustee by Merger. If the Trustee consolidates with, merges or
converts into, or transfers all or substantially all of its corporate trust business or assets to,
another corporation or banking association, the resulting, surviving or transferee corporation
without any further act shall be the successor Trustee.

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     In case at the time such successor or successors by merger, conversion or consolidation 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, 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 may
authenticate such Notes either in the name of any predecessor hereunder or in the name of the
successor to the 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.

     SECTION 7.10 Eligibility; Disqualification. The Trustee shall at all times satisfy the
requirements of TIA § 310(a). The Trustee shall have a combined capital and surplus of at least
$50,000,000 as set forth in its most recent published annual report of condition. The Trustee shall
comply with TIA § 310(b); provided, however, that there shall be excluded from the operation of TIA
§ 310(b)(1) any indenture or indentures under which other securities or certificates of interest or
participation in other securities of the
Company are outstanding if the requirements for such exclusion set forth in TIA § 310(b)(1) are
met.

     SECTION 7.11 Preferential Collection of Claims Against Company. The Trustee shall comply
with TIA § 311(a), excluding any creditor relationship listed in TIA § 311(b). A Trustee who has
resigned or been removed shall be subject to TIA § 311(a) to the extent indicated.

ARTICLE 8

DISCHARGE OF INDENTURE

     SECTION 8.01 Discharge of Liability on Notes. (a) When (i) the Company delivers to the
Registrar all outstanding Notes (other than Notes replaced pursuant to Section 2.09) for
cancellation or (ii) all outstanding Notes have become due and payable, whether at maturity or upon
a repurchase pursuant to Article 3 hereof, and the Company irrevocably deposits with the Trustee
money sufficient to pay at maturity or upon repurchase all outstanding Notes, including interest
thereon to maturity or such repurchase date (other than Notes replaced pursuant to Section 2.09),
and cash and any shares of Common Stock or other property due in respect of converted Notes, and if
in each such case the Company pays all other sums payable hereunder by the Company, then this
Indenture shall, subject to Section 8.01(b), cease to be of further effect. The Trustee shall
acknowledge satisfaction and discharge of this Indenture on demand of the Company accompanied by an
Officers’ Certificate and an Opinion of Counsel and at the cost and expense of the Company.

     (b) Notwithstanding clause (a) above, the Company’s obligations in Sections 2.05, 2.06, 2.07,
2.08, 2.09, 2.10, 7.07, 7.08 and in this Article 8 shall survive until the Notes have been paid in
full. Thereafter, the Company’s rights and obligations in Sections 7.07, 8.03 and 8.04 shall
survive.

     SECTION 8.02 Application of Trust Money. The Trustee shall hold in trust money and any
shares of Common Stock or other property due in respect of converted Notes deposited with it
pursuant to this Article 8. It shall apply the deposited money through the

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Paying Agent and in
accordance with this Indenture to the payment of principal of and interest on the Notes or, in the
case of cash and any shares of Common Stock or other property due in respect of converted Notes, in
accordance with this Indenture in relation to the conversion of Notes pursuant to the terms hereof.

     SECTION 8.03 Repayment to Company. The Trustee and the Paying Agent shall promptly turn
over to the Company upon request any excess money or securities held by them at any time.

     Subject to any applicable abandoned property law, the Trustee and the Paying Agent shall pay
to the Company upon written request any money held by them for the payment of principal
or interest and cash and any shares of Common Stock or other property due in respect of
converted Notes that remains unclaimed for two years, and, thereafter, Noteholders entitled to the
money and/or securities must look to the Company for payment as general creditors.

     SECTION 8.04 Reinstatement. If the Trustee or Paying Agent is unable to apply any money or
to deliver any shares of Common Stock or other property due in respect of converted Notes in
accordance with this Article 8 by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting
such application, the Company’s obligations under this Indenture and the Notes shall be revived and
reinstated as though no deposit had occurred pursuant to this Article 8 until such time as the
Trustee or Paying Agent is permitted to apply all such money and any shares of Common Stock or
other property due in respect of converted Notes in accordance with this Article 8; provided,
however, that, if the Company has made any payment of interest on or principal of any Notes because
of the reinstatement of its obligations, the Company shall be subrogated to the rights of the
Noteholders of such Notes to receive such payment from the money held by the Trustee or Paying
Agent.

ARTICLE 9

AMENDMENTS

     SECTION 9.01 Without Consent of Noteholders. The Company and the Trustee may amend this
Indenture or the Notes without notice to or consent of any Noteholder:

     (a) to provide for the conversion rights of Holders of the Notes and the Company’s repurchase
obligations in connection with a Fundamental Change in the event of any change or reclassification
of the Common Stock, merger, consolidation, or sale, conveyance, transfer or lease of all or
substantially all of the Company’s property and assets and the property and assets of the Company’s
subsidiaries taken as a whole;

     (b) to secure the Notes;

     (c) to comply with Article 5;

     (d) to surrender any right or power herein conferred upon the Company;

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     (e) to add to the covenants of the Company for the benefit of the Noteholders (including
adding one or more additional put rights in favor of the Noteholders);

     (f) to cure any ambiguity or correct or supplement any inconsistent or otherwise defective
provision contained in this Indenture; provided that such modification or amendment does not
adversely affect the interests of the Holders of the Notes in any material respect; provided,
further, that any amendment made solely to conform the provisions of this Indenture to the
Description of the Notes contained in the Company’s Offering Memorandum dated June 18, 2007 will
not be deemed to adversely affect the interests of the Holders of the Notes;

     (g) make any provision with respect to matters or questions arising under the Indenture that
the Company may deem necessary or desirable and that shall not be inconsistent with provisions of
this Indenture; provided that such change or modification does not, in the good faith opinion of
the Board of Directors, adversely affect the interests of the holders of the Notes in any material
respect;

     (h) to increase the Conversion Rate; provided that the increase will not adversely affect the
interests of the Holders of the Notes;

     (i) to comply with any requirements of the SEC in order to effect or maintain the
qualification of this Indenture under the TIA;

     (j) to add guarantees of obligations under the Notes;

     (k) to make any changes or modifications necessary in connection with the registrations of the
Notes under the Securities Act as contemplated in each Registration Rights Agreement; provided that
such change or modification does not adversely affect the interests of the Holders of the Notes in
any material respect;

     (l) to provide for a successor Trustee; or

     (m) to provide for uncertificated Notes in addition to or in place of certificated Notes;
provided, however, 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.

     After an amendment under this Section becomes effective, the Company shall mail to Noteholders
a notice briefly describing such amendment. The failure to give such notice to all Noteholders, or
any defect therein, shall not impair or affect the validity of an amendment under this Section.

     SECTION 9.02 With Consent of Noteholders. The Company and the Trustee may amend this
Indenture or the Notes with the written consent or affirmative vote of the Holders of at least a
majority in aggregate principal amount of the Notes then outstanding (including, without
limitation, consents obtained in connection with a purchase of, or a tender offer or exchange offer
for the Notes), without prior notice to any other Noteholder. However, without the written consent
of each Holder of an outstanding Note affected (including, without limitation,

46

 

consents obtained in
connection with or purchase of, or tender offer or exchange offer for, the Notes), an amendment may
not:

     (a) extend the Maturity Date of any Note;

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

     (c) reduce the principal amount of any Note;

     (d) reduce the amount payable upon repurchase of any Notes;

     (e) impair the right of a Holder to receive payment with respect to the Notes, including
payment of interest, or institute suit for payment of any Note;

     (f) make any Note payable in a currency other than that stated in the Note;

     (g) change the Company’s obligation to repurchase any Notes upon a Fundamental Change in a
manner adverse to the Holders;

     (h) affect the right of a Holder to convert any Note into cash and, if applicable, shares of
Common Stock, or reduce the number of shares of Common Stock or any other property, including cash,
receivable upon conversion pursuant to the terms of this Indenture;

     (i) change the Company’s obligation to maintain an office or agency in New York City under
Section 4.02 hereof;

     (j) modify Sections 9.01 and 9.02 or modify Section 6.04, except to increase the percentage in
aggregate principal amount of the outstanding Notes required for waiver or to provide for consent
of each affected Holder of Notes; or

     (k) reduce the percentage in aggregate principal amount of the outstanding Notes required for
consent to any modification of the Indenture that does not require the consent of each affected
Holder.

     For the avoidance of doubt, the only written consent or affirmative vote required to approve
any of the foregoing changes is the written consent or affirmative vote of the Holder of each Note
affected by such change; the written consent or affirmative vote of the Holders of a majority in
aggregate principal amount of the outstanding Notes is not additionally required.

     It is not necessary for the consent of the Holders of Notes under this Indenture to approve
the particular form of any proposed amendment, supplement or waiver, but it is sufficient if such
consent approves the substance thereof.

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     After an amendment under this Section becomes effective, the Company shall mail to Noteholders
a notice briefly describing such amendment. The failure to give such notice to all Noteholders, or
any defect therein, shall not impair or affect the validity of an amendment under this Section.

     SECTION 9.03 Compliance with Trust Indenture Act. Every amendment to this Indenture or the
Notes shall comply with the TIA as then in effect.

     SECTION 9.04 Revocation and Effect of Consents and Waivers. A consent to an amendment or a
waiver by a Noteholder of a Note shall bind the Noteholder and every subsequent Noteholder of that
Note or portion of the Note that evidences the same debt as the consenting Noteholder’s Note, even
if notation of the consent or waiver is not made
on the Note. However, any such Noteholder or subsequent Noteholder may revoke the consent or
waiver as to such Noteholder’s Note or portion of the Note if the Trustee receives the notice of
revocation before the date the amendment or waiver becomes effective. An amendment or waiver
becomes effective once both (i) the requisite number of consents have been received by the Company
or the Trustee and (ii) such amendment or waiver has been executed by the Company and the Trustee.

     The Company may, but shall not be obligated to, fix a record date for the purpose of
determining the Noteholders entitled to give their consent or take any other action described above
or required or permitted to be taken pursuant to this Indenture. If a record date is fixed, then
notwithstanding the immediately preceding paragraph, those Persons who were Noteholders at such
record date (or their duly designated proxies), and only those Persons, shall be entitled to give
such consent or to revoke any consent previously given or to take any such action, whether or not
such Persons continue to be Noteholders after such record date. No such consent shall be valid or
effective for more than 120 calendar days after such record date.

     For purposes of this Indenture, the consent of the Holder of a Global Note shall be deemed to
include any consent delivered by any member of, or participant in, any Depositary or DTC, any
nominees thereof and their respective successors and assigns, or such other depositary institution
hereinafter appointed by the Company (“Depositary Entity”) by electronic means in accordance with
the Automated Tender Offer Procedures system or other customary procedures of, and pursuant to
authorization by, such Depositary Entity.

     Without limiting the generality of this Section 9.04, unless otherwise provided in or pursuant
to this Indenture, a Holder, including a Depositary or its nominee that is a Holder of a Global
Note, may give, make or take, by an agent or agents duly appointed in writing, any request, demand,
authorization, direction, notice, consent, waiver or other action provided or permitted in or
pursuant to this Indenture to be given, made or taken by Holders, and a Depositary or its nominee
that is a Holder of a Global Note may duly appoint in writing as its agent or agents members of, or
participants in, such Depositary holding interests in such Global Note in the records of such
Depositary, with regard to all or any part of the principal amount of such Note.

     Nothing in this paragraph shall be construed to prevent the Company or the Trustee from fixing
a new record date for any action for which a record date has previously been set pursuant

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to this
paragraph (whereupon the record date previously set shall automatically and with no further action
by any Person be canceled and of no effect).

     SECTION 9.05 Notation on or Exchange of Notes. If an amendment changes the terms of a Note,
the Trustee may require the Noteholder of the Note to deliver it to the Trustee. The Trustee may
place an appropriate notation on the Note regarding the changed terms and return it to the
Noteholder. Alternatively, if the Company or the Trustee so determines, the Company in exchange
for the Note shall issue and the Trustee shall authenticate a new Note that reflects the changed
terms. Failure to make the appropriate notation or to issue a new Note shall not affect the
validity of such amendment.

     SECTION 9.06 Trustee to Sign Amendments. The Trustee shall sign any amendment authorized
pursuant to this Article 9 if the amendment does not adversely affect the rights, duties,
liabilities or immunities of the Trustee. If it does, the Trustee may but need not sign it. In
signing such amendment the Trustee shall be provided with, and (subject to Section 7.01) shall be
fully protected in relying upon, in addition to the documents required by Section 11.04, an
Officers’ Certificate and an Opinion of Counsel stating that such amendment is authorized or
permitted by this Indenture and that such amendment is the legal, valid and binding obligation of
the Company enforceable against it in accordance with its terms, subject to customary exceptions,
and complies with the provisions hereof (including Section 9.03).

ARTICLE 10

CONVERSION OF NOTES

     SECTION 10.01 Right to Convert. (a) Subject to and upon compliance with the provisions of
this Indenture, on or prior to 5:00 p.m., New York City time, on the second Business Day
immediately preceding the Maturity Date, the Holder of any Notes not previously repurchased shall
have the right, at such Holder’s option, to convert the principal amount of the Notes held by such
Holder, or any portion of such principal amount which is an integral multiple of $1,000, into cash
and, if applicable, fully paid and non-assessable shares of Common Stock as described in Section
10.11, at the Conversion Rate in effect at such time, by surrender of the Notes so to be converted
in whole or in part, together with any required funds, under the circumstances described in this
Section 10.01 and in the manner provided in Section 10.02. The Notes shall be convertible, on or
prior to 5:00 p.m., New York City time, on the second Business Day immediately preceding the
Maturity Date, only during the following periods:

     (1) on any date during any Fiscal Quarter beginning after October 31, 2007 (and only
during such Fiscal Quarter), if the Closing Sale Price of a share of Common Stock was more
than 130% of the then current Conversion Price for at least 20 Trading Days in the 30
consecutive Trading-Day period ending on the last Trading Day of the immediately preceding
Fiscal Quarter;

     (2) on any date that is on or after March 15, 2012;

     (3) if the Company distributes to all holders of Common Stock rights or warrants (other
than pursuant to a shareholder rights plan) entitling them to purchase, for a period of 45
calendar days or less, Common Stock at a price less than the average

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Closing Sale Price per
share of the Common Stock for the 10 Trading Days preceding the declaration date for such
distribution;

     (4) if the Company distributes to all holders of Common Stock, cash or other assets,
debt securities or rights to purchase the Company’s securities (other than pursuant to a
shareholder rights plan, which distribution has a per share value as determined by the
Board of Directors exceeding 10% of the Closing Sale Price per share of the Common
Stock on the Trading Day preceding the declaration for such distribution;

     (5) if a transaction constituting a Fundamental Change of the type described in clauses
(a) or (d) of the definition of Fundamental Change occurs, at any time beginning on the
Business Day following the effective date of the Fundamental Change until 5:00 p.m., New
York City time, on the Business Day preceding the Fundamental Change Repurchase Date
relating to such Fundamental Change;

     (6) during the five Business Day period immediately following any five consecutive
Trading-Day period in which the average Trading Price per $1,000 principal amount of the
Notes was less than 98% of the product of (x) the average Closing Sale Price of a share of
Common Stock for each day during such five Trading Day period multiplied by (y) the
applicable Conversion Rate, as determined following a request by a Holder of Notes as set
forth in Section 10.01(c) below; and

     (7) at any time beginning 15 calendar days prior to the date announced by the Company
as the anticipated effective date of, and ending on and including the date that is 15
calendar days after the actual effective date of, any transaction in which the Company is
party to a consolidation, merger, binding share exchange or sale or conveyance of all or
substantially all of the Company’s property and assets that does not constitute a
Fundamental Change, in each case pursuant to which all or substantially all of the Common
Stock would be converted into cash, securities and/or other property; provided, however,
that notwithstanding the foregoing, the Notes shall not be convertible under this clause (7)
by reason of a transaction described in subclause (i) or subclause (ii) of clause (d) of the
definition of Fundamental Change or a transaction that is excluded from the definition of
Fundamental Change by the paragraph set forth below clause (e) of the definition of
Fundamental Change.

     (b) In the case of a distribution contemplated by clause (3) or (4) of Section 10.01(a), the
Company shall notify Holders of Notes at least 20 calendar days prior to the Ex-Dividend Date for
such distribution (the “Distribution Notice”). On the date such Distribution Notice is given, the
Company shall issue a press release containing the relevant information and make this information
available on the Company Website. Once the Company has given the Distribution Notice, Holders may
surrender their Notes for conversion at any time until the earlier of (i) 5:00 p.m., New York City
time, on the Business Day preceding the Ex-Dividend Date or (ii) the Company’s announcement that
such distribution will not take place. In the event of a distribution contemplated by clause (3) or
(4) of Section 10.01(a), Holders may not convert the Notes if the Holders may otherwise participate
in such distribution without converting their Notes.

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     (c) The Trustee shall have no obligation to determine the Trading Price of the Notes and
whether the Notes are convertible pursuant to clause (6) of Section 10.01(a) unless the Company has
requested such determination; and the Company shall have no obligation to make such request unless
a Holder of the Notes makes a request for a determination. At such time, the Company shall
instruct the Trustee to determine the Trading Price of the Notes for each successive Trading Day
until it is determined that the Trading Price for the Notes for a Trading
Day is not less than 98% of the product of the Closing Sale Price of the Common Stock and the
applicable Conversion Rate, and to notify the Company accordingly. The Trustee’s sole duty in
respect of such determination shall consist of requesting and receiving, and, if applicable,
averaging the quotations provided by the independent nationally recognized securities dealers
referred to in the definition of “Trading Price.”

     The Trustee shall be entitled at its sole discretion to consult with the Company and to
request the assistance of the Company in connection with the Trustee’s duties and obligations
pursuant to this Section 10.01(c) (including without limitation the calculation or determination of
the Conversion Rate, the Closing Sale Price and the Trading Price), and the Company agrees, if
requested by the Trustee, to cooperate with, and provide assistance to, the Trustee in carrying out
its duties under this Section 10.01(c).

     (d) Whenever the Notes shall become convertible pursuant to Section 10.01(a)(1) or (6), the
Company shall promptly notify the Trustee and the Conversion Agent, and the Company or, at the
Company’s request, the Trustee in the name and at the expense of the Company, shall promptly notify
the Holders, of the event triggering such convertibility in the manner provided in Section 11.02.
Whenever the Notes shall become convertible pursuant to Section 10.01(a)(5), the Company shall at
least 10 calendar days prior to the anticipated effective date of the relevant transaction or
fundamental change, as applicable, notify the Trustee and the Conversion Agent, and the Company,
or, at the Company’s request, the Trustee in the name and at the expense of the Company, shall
promptly notify the Holders, of the event triggering such convertibility in the manner provided in
Section 11.02. In each case, simultaneously with providing such notice, the Company shall also
publicly announce such information and make this information available on the Company Website or
through another public medium the Company uses at that time. Any notice so given shall be
conclusively presumed to have been duly given, whether or not the Holder receives such notice.

     (e) Notwithstanding any other provision of this Indenture, prior to the receipt by the Company
of the Stockholder Approval, the maximum number of shares of Common Stock that the Company shall be
obligated to deliver upon conversion of each $1,000 principal amount of Notes pursuant to this
Article 10 shall be limited to the Share Cap, provided, however, the Share Cap            will apply
only with respect to the issuance of the Common Stock upon conversion of the Notes, and not to
payment of cash or the issuance of other securities into which the Notes may be convertible.

     SECTION 10.02 Exercise of Conversion Right; Issuance of Common Stock on Conversion; No
Adjustment for Interest or Dividends. In order to exercise the conversion right with respect to any Notes in certificated form, a
Holder must (A) complete and manually sign an irrevocable notice of conversion in the form entitled
“Form of Conversion Notice”

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attached to the reverse of such certificated Note (or a facsimile
thereof) (a “Conversion Notice”), (B) deliver such Conversion Notice and certificated Note to the
Conversion Agent at the office of the Conversion Agent, (C) to the extent any shares of Common
Stock issuable upon conversion are to be issued in a name other than the Holder’s, furnish
endorsements and transfer documents as may be required by the Conversion Agent, (D)
if required pursuant to Section 10.07, pay all transfer or similar taxes or duties and (E) if
required pursuant to Section 2.03, pay funds equal to interest payable on the next Interest Payment
Date.

     In order to exercise the conversion right with respect to any interest in a Global Note, the
Holder must (A) complete, or cause to be completed, the appropriate instruction form for conversion
pursuant to the Depositary’s book-entry conversion procedures; (B) deliver, or cause to be
delivered, by book-entry delivery an interest in such Global Note; (C) furnish appropriate
endorsements and transfer documents if required by the Company or the Trustee or Conversion Agent;
and (D) pay the funds, if any, required by Section 2.03 and any transfer or similar taxes or duties
if required pursuant to Section 10.07.

     Notes in respect of which a Holder has delivered a Repurchase Notice exercising such Holder’s
right to require the Company to repurchase such Notes pursuant to Section 3.01 may be converted
only if such Repurchase Notice is withdrawn in accordance with Section 3.03 prior to 5:00 p.m., New
York City time, on the Business Day immediately preceding the Fundamental Change Repurchase Date,
unless the Company defaults in the payment of the repurchase price.

     Each conversion shall be deemed to have been effected as to any such Notes (or portion
thereof) immediately prior to 5:00 p.m., New York City time, on the date on which the requirements
set forth above in this Section 10.02 have been satisfied as to such Notes (or portion thereof)
(the “Conversion Date”).

     The cash and, if applicable, shares of Common Stock into which the Notes are converted (and
cash in lieu of fractional shares) will be delivered to such Holder after satisfaction of the
requirements for conversion set forth above, in accordance with Section 10.11.

     In case any Notes of a denomination greater than $1,000 shall be surrendered for partial
conversion, and subject to Section 2.03, the Company shall execute and the Trustee shall
authenticate and deliver to the Holder of the Notes so surrendered, without charge to the Holder, a
new Note or Notes in authorized denominations in an aggregate principal amount equal to the
unconverted portion of the surrendered Notes.

     Upon the conversion of an interest in a Global Note, the Trustee (or other Conversion Agent
appointed by the Company) and the Depositary shall reduce the principal amount of such Global Note
in their records. The Company shall notify the Trustee in writing of any conversions of Notes
effected through any Conversion Agent other than the Trustee.

     Except as provided in Section 2.03, upon conversion, a Holder will not receive any separate
cash payment of accrued and unpaid interest on the Notes. Except as provided in Section 2.03,
accrued and unpaid interest, if any, to the Conversion Date is deemed to be paid in full rather
than cancelled, extinguished or forfeited.

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     A Holder of Notes is not entitled to any rights of a holder of Common Stock until such Holder
has converted its Notes to Common Stock, and only to the extent such Notes are deemed to have been
converted to Common Stock under this Article 10. Subject to Section 10.05(j), the Holder of Notes
that has converted its Notes (or if such person designated another person to whom such Common Stock
shall be issued and delivered, such person) shall be treated as a
holder of record of such Common Stock as of 5:00 p.m., New York City time, on the final
Trading Day of the applicable Conversion Period.

     If the cash paid by the Company to a Holder upon conversion of the Notes pursuant to this
Article 10 is not sufficient to allow the Company to comply with the United States federal
withholding tax obligations imposed by the Code with respect to accrued and unpaid interest on the
Notes payable to the beneficial owner of such Notes, the Company may, to the extent required by
applicable law, recoup or set-off such liability against any amounts owed to such Holder,
including, but not limited to, the shares of Common Stock to be issued upon conversion to such
beneficial owner or any actual cash dividends or distributions subsequently made with respect to
such shares of Common Stock to such beneficial owner.

     SECTION 10.03 Cash Payments in Lieu of Fractional Shares. No fractional shares of Common Stock or scrip certificates representing fractional shares shall
be issued upon conversion of 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 issuable upon conversion shall
be computed on the basis of the aggregate principal amount of the Notes (or specified portions
thereof to the extent permitted hereby) so surrendered. If any fractional share of stock would be
issuable upon the conversion of any Note or Notes, the Company shall instead deliver cash with
respect to the fractional share calculated by multiplying the Volume Weighted Average Price on the
final Trading Day of the applicable Conversion Period by the fractional amount and rounding the
product to the nearest cent.

     SECTION 10.04 Conversion Rate.

     (a) Each $1,000 principal amount of the Notes shall be convertible into cash and the number of
shares of Common Stock, if any, based upon the Conversion Rate, which is subject to adjustment as
provided in this Section 10.04 and Section 10.05.

     (b) Subject to Section 10.12, if and only to the extent a Holder elects to convert Notes in
connection with a Non-Stock Change of Control, the Company shall increase the Conversion Rate
applicable to such converted Notes by a number of additional shares of Common Stock (the
“Additional Shares”) as set forth below. A conversion of the Notes by a Holder will be deemed for
these purposes to be “in connection with” a Non-Stock Change of Control if the Conversion Notice is
received by the Conversion Agent during the period from the Business Day following the Effective
Date of the Non-Stock Change of Control to 5:00 p.m., New York City time, on the Business Day
immediately preceding the related Fundamental Change Repurchase Date.

     The number of Additional Shares shall be determined by reference to the table below, based on
the date on which the Non-Stock Change of Control occurs or becomes effective (the “Effective
Date”) and the Stock Price paid per share for the Common Stock in the Non-Stock Change of Control.
The numbers of Additional Shares set forth in the table below shall be

53

 

adjusted as of any date on
which the Conversion Rate is adjusted in the same manner in which the Conversion Rate is adjusted.
The Stock Prices set forth in the first row of the table below
(i.e., the column headers) shall be adjusted, as of any date on which the Conversion Rate is
adjusted, to equal the Stock Price applicable immediately prior to such adjustment multiplied by a
fraction, of which

     (1) the numerator shall be the Conversion Rate immediately prior to the adjustment and

     (2) the denominator shall be the Conversion Rate as so adjusted.

     The following table sets forth the Stock Price and number of Additional Shares by which the
Conversion Rate shall be increased:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Stock price
	Effective Date	 	$ 36.68	 	$44.02	 	$50.00	 	$60.00	 	$70.00	 	$ 80.00	 	$90.00	 	$100.00	 	$120.00	 	$140.00	 	$160.00
	June 22, 2007
	 	 	4.5438	 	 	 	2.8578	 	 	 	2.0293	 	 	 	1.2128	 	 	 	0.7669	 	 	 	0.5055	 	 	 	0.3429	 	 	 	0.2366	 	 	 	0.1139	 	 	 	0.0515	 	 	 	0.0185	 
	June 15, 2008
	 	 	4.5438	 	 	 	2.7759	 	 	 	1.9102	 	 	 	1.0869	 	 	 	0.6590	 	 	 	0.4198	 	 	 	0.2771	 	 	 	0.1870	 	 	 	0.0863	 	 	 	0.0367	 	 	 	0.0111	 
	June 15, 2009
	 	 	4.5438	 	 	 	2.6242	 	 	 	1.7199	 	 	 	0.9050	 	 	 	0.5135	 	 	 	0.3108	 	 	 	0.1977	 	 	 	0.1298	 	 	 	0.0571	 	 	 	0.0222	 	 	 	0.0044	 
	June 15, 2010
	 	 	4.5438	 	 	 	2.3722	 	 	 	1.4271	 	 	 	0.6504	 	 	 	0.3271	 	 	 	0.1825	 	 	 	0.1112	 	 	 	0.0717	 	 	 	0.0308	 	 	 	0.0105	 	 	 	0.0002	 
	June 15, 2011
	 	 	4.5438	 	 	 	1.8953	 	 	 	0.9221	 	 	 	0.2813	 	 	 	0.1016	 	 	 	0.0496	 	 	 	0.0310	 	 	 	0.0215	 	 	 	0.0099	 	 	 	0.0020	 	 	 	—	 
	June 15, 2012
	 	 	4.5438	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 

     provided, however, that:

     (i) If the actual Stock Price and actual Effective Date are not set forth on the table
above and the actual Stock Price is between two Stock Prices on the table or the actual
Effective Date is between two days on the table, the number of Additional Shares shall be
determined by straight-line interpolation between the number of Additional Shares of Common
Stock set forth for the higher and lower Stock Price and the two Effective Dates, as
applicable, based on a 365-day year;

     (ii) If the actual Stock Price is in excess of $160.00 per share (subject to adjustment
in the same manner as and as of any date on which the Stock Prices are adjusted in the table
above), the Conversion Rate will not be increased; or

     (iii) If the actual Stock Price is less than $36.68 per share (subject to adjustment in
the same manner as and as of any date on which the Stock Prices are adjusted in the table
above), the Conversion Rate will not be increased.

     Notwithstanding the foregoing, in no event will the Conversion Rate exceed 27.2628 per $1,000
principal amount of the Notes, subject to adjustments in the same manner as and as of any date on
which the numbers of Additional Shares set forth in the above table are adjusted.

     SECTION 10.05 Adjustment of Conversion Rate. The Conversion Rate shall be adjusted from time to time by the Company as follows:

54

 

     (a) In case the Company shall, at any time or from time to time while any of the Notes are
outstanding, pay a dividend in shares of Common Stock or make a distribution in shares of Common
Stock to all Holders of its outstanding shares of Common Stock (other than a dividend or
distribution upon a transaction to which Section 10.06 applies), then the Conversion Rate shall be
adjusted based on the following formula:

	 	 	 	 	 
	 

	 	CR1 = CR0 x  
	OS1	 
	 
	 	 	 
	 
	 	OS0	 

where

	 	 	 	 	 	 	 
	 

	 	CR0
	 	=
	 	the Conversion Rate in effect at 5:00 p.m., New York City time, on the
Trading Day immediately preceding the Ex-Dividend Date for such dividend or
distribution;
	 
	 	 	 	 	 	 
	 

	 	CR1
	 	=
	 	the Conversion Rate in effect at 9:00 a.m., New York City time, on the
Ex-Dividend Date for such dividend or distribution;
	 
	 	 	 	 	 	 
	 

	 	OS0
	 	=
	 	the number of shares of Common Stock outstanding at 5:00 p.m., New York
City time, on the Trading Day immediately preceding the Ex-Dividend Date for such
dividend or distribution; and
	 
	 	 	 	 	 	 
	 

	 	OS1
	 	=
	 	the number of shares of Common Stock that would be outstanding immediately
after giving effect to such dividend or distribution.

     Any adjustment made pursuant to this Section 10.05(a) shall become effective at 9:00 a.m., New
York City time, on the Ex-Dividend Date for such dividend or distribution. If any dividend or
distribution that is the subject of this Section 10.05(a) is declared but not so paid or made, the
Conversion Rate shall be immediately readjusted, effective as of the date the Board of Directors
publicly announces its decision not to pay or make such dividend or distribution, to the Conversion
Rate that would then be in effect if such dividend or distribution had not been declared.

     (b) In case outstanding shares of Common Stock shall be subdivided into a greater number of
shares of Common Stock or combined into a smaller number of shares of Common Stock or reclassified
(in each case, other than upon a transaction to which Section 10.06 applies), the Conversion Rate
shall be adjusted based on the following formula:

	 	 	 	 	 
	 
	 	CR1 = CR0 x  
	OS1	 
	 
	 	 	 
	 
	 	OS0	 

where

	 	 	 	 	 	 	 
	 

	 	CR0
	 	=
	 	the Conversion Rate in effect at 5:00 p.m., New York City time, on the
Trading Day immediately preceding the effective date of such subdivision, combination
or reclassification;

55

 

	 	 	 	 	 	 	 
	 

	 	CR1
	 	=
	 	the Conversion Rate in effect at 9:00 a.m., New York City time, on the
effective date of such subdivision, combination or reclassification;
	 

	 	OS0
	 	=
	 	the number of shares of Common Stock outstanding at 5:00 p.m., New York
City time, on the Trading Day immediately preceding the effective date of such
subdivision, combination or reclassification; and
	 

	 	OS1
	 	=
	 	the number of shares of Common Stock that would be outstanding immediately
after, giving effect to such subdivision, combination or reclassification.

     Any adjustment made pursuant to this Section 10.05(b) shall become effective at 9:00 a.m., New
York City time, on the effective date of such subdivision, combination or reclassification.

     (c) In case the Company shall issue rights or warrants to all holders of its outstanding
shares of Common Stock (other than upon a transaction to which Section 10.06 applies) entitling
them to purchase, for a period of up to 45 calendar days, shares of Common Stock at a price per
share less than the Current Market Price, the Conversion Rate shall be adjusted based on the
following formula:

	 	 	 	 	 
	 
	 	CR1 = CR0 x  
	OS0 + X	 
	 
	 	 	 
	 
	 	OS0 + Y	 

where

	 	 	 	 	 	 	 
	 

	 	CR0
	 	=
	 	the Conversion Rate in effect at 5:00 p.m., New York City time, on the
Trading Day immediately preceding the Ex-Dividend Date for such issuance;
	 
	 	 	 	 	 	 
	 

	 	CR1
	 	=
	 	the Conversion Rate in effect at 9:00 a.m., New York City time, on the
Ex-Dividend Date for such issuance;
	 
	 	 	 	 	 	 
	 

	 	OS0
	 	=
	 	the number of shares of the Common Stock that are outstanding at 5:00 p.m.,
New York City time, on the Trading Day immediately preceding the Ex-Dividend Date for
such issuance;
	 
	 	 	 	 	 	 
	 

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

	 	Y
	 	=
	 	the number of shares of the Common Stock equal to the quotient of (x)
aggregate price payable to exercise such rights or warrants, divided by (y) the Current
Market Price of the Common Stock.

     Any adjustment made pursuant to this Section 10.05(c) shall become effective at 9:00 a.m., New
York City time, on the Ex-Dividend Date for such issuance. The Company shall not issue any such
rights or warrants in respect of shares of the Common Stock held in treasury by

56

 

the Company. If any rights or warrants described in this Section 10.05(c) are not so issued,
the Conversion Rate shall be immediately readjusted, effective as of the date the Board of
Directors publicly announces its decision not to issue such rights or warrants, to the Conversion
Rate that would then be in effect if such issuance had not been declared. To the extent that such
rights or warrants are not exercised prior to their expiration or shares of the Common Stock are
otherwise not delivered pursuant to such rights or warrants upon the exercise of such rights or
warrants, 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 the aggregate price payable for such shares of the Common Stock, there shall be
taken into account any consideration received by the Company for such rights or warrants and the
value of such consideration (if other than cash, to be determined by the Board of Directors).

     (d) (A) In case the Company shall, by dividend or otherwise, distribute to all holders of its
outstanding shares of Common Stock shares of any class of Capital Stock of the Company (other than
Common Stock) or evidences of its indebtedness or assets (including securities, but excluding (i)
any dividends or distributions referred to in Section 10.05(a), (ii) any rights or warrants
referred to in Section 10.05(c), (iii) any dividends or distributions referred to in Section
10.05(e), (iv) any dividends or distributions in connection with a transaction to which Section
10.06 applies, or (v) any Spin-Offs to which the provisions set forth below in this Section
10.05(d) applies) (any such distribution hereinafter in this Section 10.05(d) being referred to as
the “Distributed Assets”), then, in each such case, the Conversion Rate shall be adjusted based on
the following formula:

	 	 	 	 	 
	 
	 	CR1 = CR0 x  
	SP0	 
	 
	 	 	 
	 
	 	SP0 - FMV	 

where

	 	 	 	 	 	 	 
	 

	 	CR0
	 	=
	 	the Conversion Rate in effect at 5:00 p.m., New York City time, on the
Trading Day immediately preceding the Ex-Dividend Date for such distribution;
	 
	 	 	 	 	 	 
	 

	 	CR1
	 	=
	 	the Conversion Rate in effect at 9:00 a.m., New York City time, on the
Ex-Dividend Date for such distribution;
	 
	 	 	 	 	 	 
	 

	 	SP0
	 	=
	 	the Current Market Price of the Common Stock; and
	 
	 	 	 	 	 	 
	 

	 	FMV
	 	=
	 	the Fair Market Value on the Ex-Dividend Date for such distribution of the
Distributed Assets so distributed applicable to one share of Common Stock.

     (B) Where there has been a payment of a dividend or other distribution on the Common Stock of
shares of Capital Stock of any class or series, or similar equity interest, of or relating to

57

 

a Subsidiary or other business unit of the Company (such transaction being referred to as a
“Spin-Off” and such shares of Capital Stock or similar equity interest being referred to as the
“Spin-Off Distributed Assets”), then the Conversion Rate shall instead be adjusted based on the
following formula:

	 	 	 	 	 
	 
	 	CR1 = CR0 x  
	FMV0 + SP0	 
	 
	 	 	 
	 
	 	SP0	 

where

	 	 	 	 	 	 	 
	 

	 	CR0
	 	=
	 	the Conversion Rate in effect at 5:00 p.m., New York City time, on the
Trading Day immediately preceding the effective date of the Spin-Off;
	 
	 	 	 	 	 	 
	 

	 	CR1
	 	=
	 	the Conversion Rate in effect at 9:00 a.m., New York City time, on the
effective date of the Spin-Off;
	 
	 	 	 	 	 	 
	 

	 	FMV0
	 	=
	 	the average of the Closing Sale Prices of the Spin-Off Distributed Assets
applicable to one share of Common Stock over the ten consecutive Trading Day period
commencing on and including the effective date of the Spin-Off (the “Spin-Off Valuation
Period”); and
	 
	 	 	 	 	 	 
	 

	 	SP0
	 	=
	 	the average of the Closing Sale Prices of the Common Stock over the
Spin-Off Valuation Period.

     Any adjustment made pursuant to this Section 10.05(d)(B) shall become effective at 5:00 p.m.,
New York City time, 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 immediately
following, and including, the effective date of any Spin-Off, references with respect to the
Spin-Off Valuation Period to ten Trading Days shall be deemed replaced with such lesser number of
Trading Days as have elapsed between the effective date of such Spin-Off and the conversion date in
determining the applicable Conversion Rate.

     If an adjustment to the Conversion Rate is required under this Section 10.05(d)(B) during any
Conversion Period in respect of Notes that have been tendered for conversion, delivery of the
related Conversion Settlement Amount shall be delayed to the extent necessary in order to complete
the calculations provided for in this Section 10.05(d)(B). If any dividend or distribution of the
type described in this Section 10.05(d) is declared but not so paid or made, the Conversion Rate
shall be immediately readjusted, effective as of the date the Board of Directors publicly announces
its decision not to pay such dividend or distribution, to the Conversion Rate that would then be in
effect if such dividend or distribution had not been declared.

     Rights or warrants distributed by the Company to all holders of Common Stock entitling the
Holders thereof to subscribe for or purchase shares of the Company’s capital stock (either
initially or under certain circumstances), which rights or warrants, until the occurrence of a
specified event or events (“Trigger Event”): (i) are deemed to be transferred with such shares of
Common Stock; (ii) are not exercisable; and (iii) are also issued in respect of future issuances of

58

 

Common Stock, shall be deemed not to have been distributed for purposes of this Section 10.05
(and no adjustment to the Conversion Rate under this Section 10.05 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 10.05(d). 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 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 10.05 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.

     No adjustment of the Conversion Rate shall be made pursuant to this Section 10.05(d) in
respect of rights or warrants distributed or deemed distributed on any Trigger Event to the extent
that such rights or warrants are actually distributed or reserved by the Company for distribution
to Holders of Notes upon conversion by such Holders of Notes to Common Stock.

     (e) In case the Company shall pay a dividend or otherwise distribute to all holders of its
Common Stock a dividend or other distribution of exclusively cash excluding (x) any dividend or
distribution in connection with the liquidation, dissolution or winding up of the Company, whether
voluntary or involuntary and (y) any dividend or distribution in connection with a transaction to
which Section 10.06 applies, then the Conversion Rate shall be adjusted based on the following
formula:

	 	 	 	 	 
	 
	 	CR1 = CR0 x  
	SP0	 
	 
	 	 	 
	 
	 	SP0 - C	 

where

	 	 	 	 	 	 	 
	 

	 	CR0
	 	=
	 	the Conversion Rate in effect at 5:00 p.m., New York City time,
on the Trading Day immediately preceding the Ex-Dividend Date for such dividend
or distribution;

59

 

	 	 	 	 	 	 	 
	 

	 	CR1
	 	=
	 	the Conversion Rate in effect at 9:00 a.m., New York City time,
on the Ex-Dividend Date for such dividend or distribution;
	 
	 	 	 	 	 	 
	 

	 	SP0
	 	=
	 	the Current Market Price of the Common Stock; and
	 
	 	 	 	 	 	 
	 

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

Any adjustment made pursuant to this Section 10.05(e) shall become effective at 9:00 a.m., New York
City time, on the Ex-Dividend Date for such dividend or distribution. If any dividend or
distribution of the type described in this Section 10.05(e) is declared but not so paid or made,
the Conversion Rate shall be immediately readjusted, effective as of the date the Board of
Directors publicly announces its decision not to pay such dividend or distribution, to the
Conversion Rate that would then be in effect if such dividend or distribution had not been
declared.

     (f) In case a tender offer or exchange offer made by the Company or any Subsidiary of the
Company for all or any portion of the Common Stock shall expire and such tender or exchange offer
(as amended upon the expiration thereof) shall require the payment to stockholders of cash and any
other consideration per share of Common Stock having a Fair Market Value as of the last date (the
“Expiration Date”) tenders or exchanges may be made pursuant to such tender offer or exchange offer
(as it may be amended) that exceeds the Closing Sale Price of a share of Common Stock on the
Trading Day next succeeding the Expiration Date, the Conversion Rate shall be adjusted based on the
following formula:

	 	 	 	 	 
	 
	 	CR1 = CR0 x  
	FMV + (SP1 x OS1)	 
	 
	 	 	 
	 
	 	OS0 x SP1	 

where

	 	 	 	 	 	 	 
	 

	 	CR0
	 	=
	 	the Conversion Rate in effect at 5:00 p.m., New York City time, on the
Expiration Date;
	 
	 	 	 	 	 	 
	 

	 	CR1
	 	=
	 	the Conversion Rate in effect at 9:00 a.m., New York City time, on the
Business Day following the Expiration Date;
	 
	 	 	 	 	 	 
	 

	 	FMV
	 	=
	 	the Fair Market Value, on the Expiration Date, of the aggregate consideration
payable for shares of Common Stock (a) validly tendered or exchanged and not withdrawn,
and (b) accepted for purchase as of the Expiration Date;
	 
	 	 	 	 	 	 
	 

	 	OS0
	 	=
	 	the number of shares of Common Stock outstanding immediately prior to the
last time tenders or exchanges may be made pursuant to such tender offer or exchange
offer (the “Expiration Time”);
	 
	 	 	 	 	 	 
	 

	 	OS1
	 	=
	 	the number of shares of Common Stock outstanding immediately after the
Expiration Time (including after giving effect to such tender offer or exchange offer;
and

60

 

	 	 	 	 	 	 	 
	 

	 	SP1
	 	=
	 	the Closing Sale Prices per share of Common Stock on the Trading Day next
succeeding the Expiration Date.

Any adjustment made pursuant to this Section 10.05(f) shall become effective at 9:00 a.m., New York
City time, on the Business Day immediately following the Expiration Date. If the Company, or one of
its Subsidiaries, is obligated to purchase shares of Common Stock pursuant to any such tender or
exchange offer, but the Company or such Subsidiary is permanently prevented by applicable law from
effecting any such purchases or all such purchases are rescinded, the Conversion Rate shall be
readjusted to be the Conversion Rate that would then be in effect if such tender or exchange offer
had not been made. Except as set forth in the preceding sentence, if the application of this
Section 10.05(f) to any tender offer or exchange offer would result in a decrease in the Conversion
Rate, no adjustment shall be made for such tender offer or exchange offer under this Section
10.05(f). If an adjustment to the Conversion Rate is required pursuant to this Section 10.05(f)
during any Conversion Period in respect of Notes that have been tendered for conversion, delivery
of the related Conversion Settlement Amount shall be delayed to the extent necessary in order to
complete the calculations provided for in this Section 10.05(f).

     (g) Except with respect to a Spin-Off, in cases where the Fair Market Value of assets, debt
securities or certain rights, warrants or options to purchase the Company’s securities, applicable
to one share of Common Stock, distributed to stockholders:

     (i) equals or exceeds the average of the Closing Sales Prices per share of Common Stock
for the ten consecutive Trading Days ending on the record date of such distribution, or

     (ii) the Current Market Price of Common Stock exceeds the Fair Market Value of such
assets, debt securities or rights, warrants or options so distributed by less than $1.00,

rather than being entitled to an adjustment in the Conversion Rate, the Holder of a Note will be
entitled to receive upon conversion, in addition to the cash, and, if applicable, shares of Common
Stock, the kind and amount of assets, debt securities or rights, warrants or options comprising the
distribution, if any, that such Holder would have received if such Holder had converted such Notes
immediately prior to the Record Date for determining the stockholders entitled to receive the
distribution.

     (h) For purposes of this Section 10.05, the following terms shall have the meaning indicated:

     (i) “Current Market Price,” with respect to any issuance or distribution, means the
average of the Closing Sale Prices per share of Common Stock for the ten consecutive Trading
Days immediately prior to the Ex-Dividend Date for such issuance or distribution requiring
such computation.

Notwithstanding the foregoing, whenever successive adjustments to the Conversion Rate are
called for pursuant to this Section 10.05, such adjustments shall be made to the Current
Market Price as may be necessary or appropriate to effectuate the intent of this

61

 

Section 10.05 and to avoid unjust or inequitable results as determined in good faith by the
Board of Directors.

     (ii) “Ex-Dividend Date” means the first date on which the shares of Common Stock trade
on the applicable exchange or in the applicable market, regular way, without the right to
receive the relevant dividend, distribution or issuance.

     (i) The Company may (but is not required to) make such increases in the Conversion Rate, in
addition to those required by Section 10.05(a)-(f), as the Board of Directors considers to be
advisable to avoid or diminish any income tax to holders of Common Stock or rights to purchase
shares of Common Stock resulting from any dividend or distribution of stock (or rights to acquire
stock) or similar event.

     In addition to the foregoing, to the extent permitted by applicable law and subject to the
applicable rules of the New York Stock Exchange or any other securities exchange on which the
Common Stock is then listed, the Company from time to time may increase the Conversion Rate by any
amount for any period of time if the period is at least 20 calendar days, the increase is
irrevocable during the period. Whenever the Conversion Rate is increased pursuant to the preceding
sentence, the Company shall mail to Holders of record of the Notes a notice of the increase, which
notice will be given at least 15 calendar days prior to the effectiveness of any such increase, and
such notice shall state the increased Conversion Rate and the period during which it will be in
effect.

     (j) If during a period applicable for calculating the Closing Sale Price of Common Stock or
any other security, an event occurs that requires an adjustment to the Conversion Rate, the Closing
Sale Price of such security shall be calculated for such period in a manner determined by the
Company to appropriately reflect the impact of such event on the price of such security during such
period. Whenever any provision of this Indenture requires a calculation of an average of Closing
Sale Prices of Common Stock or any other security over multiple days, appropriate adjustments shall
be made to account for any adjustment to the Conversion Rate that becomes effective, or any event
requiring an adjustment to the Conversion Rate where the Ex-Dividend Date of the event occurs, at
any time during the period during which the average is to be calculated.

     If (A) shares of Common Stock or other securities are deliverable as part of the Daily
Settlement Amount for a given Trading Day and (B) an adjustment to Conversion Rate pursuant to this
Section 10.05 occurs after such Trading Day and prior to the date upon which the Noteholder becomes
a record holder in respect of the deliverable shares of Common Stock or other securities, then the
number of shares deliverable in respect of such Trading Day shall be adjusted in the same manner
that the Conversion Rate has been adjusted. In lieu of an adjustment of the number of shares of
Common Stock or other security deliverable to a Noteholder as a portion of Conversion Settlement
Amount, the Company may instead deem such Noteholder to be a holder of record of such Common Stock
or other security for purposes of that distribution so that such Holder would receive the
distribution at the time such Holder receives the Conversion Settlement Amount.

62

 

     (k) No adjustment in the Conversion Rate shall be required unless such adjustment would
require an increase or decrease of at least one percent (1%) in such rate; provided that any
adjustments that by reason of this Section 10.05(k) are not required to be made shall be carried
forward and the Company shall take such carry forward adjustments into account in any subsequent
adjustment, and regardless of whether the aggregate adjustment is less than 1% shall make all such
adjustments, (x) annually on the anniversary of the Closing Date and otherwise (y) (1) upon
conversion of the Notes, (2) five Business Days prior to the maturity of the Notes (whether at
stated maturity or otherwise) or (3) prior to any Fundamental Change Repurchase Date, unless such
adjustment has already been made. All calculations under this Article 10 shall be made by the
Company and shall be made to the nearest cent or to the nearest one-ten thousandth (1/10,000) of a
share, as the case may be. No adjustment need be made for rights to purchase Common Stock pursuant
to a Company plan for reinvestment of dividends or interest or for any issuance of Common Stock or
convertible or exchangeable securities or rights to purchase Common Stock or convertible or
exchangeable securities. Interest will not accrue on any cash into which the Notes are convertible.

     (l) Whenever the Conversion Rate is adjusted as herein provided, the Company will issue a
press release containing the relevant information through Business Wire or a similar service and
make this information available on the Company Website or through another public medium the Company
may use at that time. In addition, 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.
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 that the last Conversion Rate of which it has actual 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 Notes at its last address appearing on the Register, within 20 calendar
days after execution thereof. Failure to deliver such notice shall not affect the legality or
validity of any such adjustment.

     (m) For purposes of this Section 10.05, the number of shares of Common Stock at any time
outstanding shall not include shares held in the treasury of the Company but shall include shares
issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock.
The Company will not pay any dividend or make any distribution on shares of Common Stock held in
the treasury of the Company.

     (n) Notwithstanding any of the foregoing clauses in this Section 10.05, the applicable
Conversion Rate will not be adjusted pursuant to this Section 10.05 if the Holders of the Notes
will participate in the transaction that would otherwise give rise to adjustment pursuant to this
Section 10.05 without conversion of such Holder’s Notes.

     (o) If the Conversion Rate is adjusted pursuant to this Indenture, to the extent such
adjustment results in a constructive distribution to beneficial owners of Notes under Section 305
of the Code, the Company may, to the extent required by law, recoup or set-off such liability

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against any payments (whether in cash or Common Stock) made with respect to the Notes (or any
Common Stock received upon conversion thereof) to such beneficial owners.

SECTION 10.06 Effect of Reclassification, Consolidation, Merger or Sale. If any of the following events occur, namely:

	 	(a)	 	any reclassification or change of the outstanding Common Stock (other than a
changes resulting from a subdivision or combination), or
	 
	 	(b)	 	any consolidation or merger of the Company with or into another Person, or any
sale, lease, transfer, conveyance or other disposition of all or substantially all of
the Company’s assets and the assets of its Subsidiaries, taken as a whole, to any other
Person or Persons,

as a result of which holders of Common Stock receive stock, other securities or other property or
assets (including cash or any combination thereof) with respect to or in exchange for such Common
Stock, in each case, subject to Section 10.12, the Company or the successor or purchasing
corporation, as the case may be, shall execute with the Trustee a supplemental indenture (which
shall comply with the 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) providing that each such
Note shall, without the consent of any Holders of Notes, become convertible only into the kind and
amount of the consideration that the Holders of the Notes would have received if they had converted
their Notes solely into Common Stock based on the applicable Conversion Rate immediately prior to
the reclassification, change, consolidation, merger, sale, lease, transfer, conveyance or other
disposition (the “Reference Property”). In all cases, the conditions relating to conversion of
Notes specified herein (including in Section 10.01, to the extent applicable, and Section 10.02)
(modified as appropriate in the good faith judgment of the Board of Directors to apply properly to
the Reference Property in lieu of Common Stock) and the provisions of Section 10.12 relating to the
settlement of the conversion obligation upon conversion of Notes shall continue to apply following
such transaction. If such transaction causes shares of 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), the Reference Property shall be deemed to be the weighted average of the
kind and amount of consideration received by the holders of shares of Common Stock that
affirmatively made such an election. In the event holders of the Common Stock have the opportunity
to elect the form of consideration to be received in such transaction, then from and after the
effective date of such transaction, the Notes shall be convertible into the consideration that
holders of a majority of the Common Stock who made such an election received in such transaction.
The Company may not become a party to any such transaction unless its terms are consistent with the
foregoing. Such supplemental indenture shall provide for adjustments that shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Article 10, as determined
in good faith by the Company or successor or purchasing corporation.

     If, in the case of any such reclassification, change, consolidation, merger, sale, lease,
transfer, conveyance or other disposition, the stock or other securities and assets received
thereupon by a holder of Common Stock includes shares of stock or other securities and assets
of

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a corporation other than the successor or purchasing corporation, as the case may be, in such
reclassification, change, consolidation, merger, sale, lease, transfer, conveyance or other
disposition, 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 practicable the provisions providing for the conversion rights set forth in this Article
10.

     The Company shall cause notice of the execution of such supplemental indenture to be mailed to
each Holder, at the address of such Holder as it appears on the register of the Notes maintained by
the Registrar, within 20 calendar days after execution thereof. Failure to deliver such notice
shall not affect the legality or validity of such supplemental indenture.

     The above provisions of this Section 10.06 shall similarly apply to successive
reclassifications, changes, consolidations, mergers, sales, leases, transfers, conveyances or other
dispositions.

     If this Section 10.06 applies to any event or occurrence, Section 10.05 shall not apply.
Notwithstanding this Section 10.06, if a Public Acquirer Change of Control occurs and the Company
elects to adjust its conversion obligation and the Conversion Rate pursuant to Section 10.12, the
provisions of Section 10.12 instead of this Section 10.06 shall apply to the transaction.

     SECTION 10.07 Taxes on Shares Issued. The issue of stock certificates on conversions of Notes shall be made without charge to the
converting Holder of Notes for any documentary, stamp or similar issue or transfer tax in respect
of the issue thereof. The Company shall not, however, be required to pay any such tax which may be
payable in respect of any transfer involved in the issue and delivery of stock in any name other
than that of the Holder of any Notes converted, and the Company shall not be required to issue or
deliver any such stock certificate unless and until the Person or Persons requesting the issue
thereof shall have paid to the Company the amount of such tax or shall have established to the
satisfaction of the Company that such tax has been paid.

     SECTION 10.08 Reservation of Shares, Shares to be Fully Paid; Compliance with Governmental
Requirements; Listing of Common Stock. Prior to the time at which Stockholder Approval has been obtained, the Company shall
reserve, out of its authorized but unissued Common Stock or Common Stock held in treasury,
3,250,000 shares of Common Stock for issuance upon conversion of the Notes. After Stockholder
Approval has been obtained, the Company shall, and from time to time as may be necessary, reserve,
out of its authorized but unissued Common Stock or Common Stock held in treasury, a sufficient
number of shares of Common Stock to provide for the conversion of the Notes from time to time as
such Notes are presented for conversion. All shares of Common Stock reserved by the Company for
issuance upon conversion of the Notes shall be free from preemptive rights.

     Before taking any action which would cause an adjustment increasing the Conversion Rate to an
amount that would cause the Conversion Price to be reduced 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

65

 

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 charges with
respect to the issue thereof.

     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 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.

     The Company further covenants that, if at any time the Common Stock shall be listed on any
national securities exchange or automated quotation system, the Company will, if permitted 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; provided that if the rules of such exchange or automated quotation
system permit the Company to defer the listing of such Common Stock until the first conversion of
the Notes into Common Stock in accordance with the provisions of this Indenture, the Company
covenants to list such Common Stock issuable upon conversion of the Notes in accordance with the
requirements of such exchange or automated quotation system at such time.

SECTION 10.09 Responsibility of Trustee. The Trustee and any other Conversion Agent shall not at any time be under any duty or
responsibility to any Holder of Notes 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 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 capital stock, other securities or
other assets or property, which may at any time be issued or delivered upon the conversion of any
Notes; 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 Notes for the purpose of conversion or to comply with
any of the duties, responsibilities or covenants of the Company contained in this Article 10.
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 10.06 relating either to the kind or amount of shares of capital stock or other securities
or other assets or property (including cash) receivable by Holders of Notes upon the conversion of
their Notes after any event referred to in such Section 10.06 or to any adjustment to be made with
respect thereto, but, subject to the provisions of Section 9.01, 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

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shall be obligated to file with the Trustee prior to the execution
of any such supplemental indenture) with respect thereto.

SECTION 10.10 Notice to Holders Prior to Certain Actions. Except where notice is required pursuant to Section 10.01, 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
10.05; or
	 
	 	(b)	 	the Company shall authorize the granting to all 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 that would require an adjustment in the Conversion Rate pursuant to
Section 10.05; or
	 
	 	(c)	 	of any reclassification or change of the Common Stock of the Company (other
than a subdivision or combination of its outstanding Common Stock), or of any
consolidation or merger to which the Company is a party and for which approval of the
stockholders of the Company is required, or of the sale, lease, transfer, conveyance or
other disposition 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;

and, in the case of the events specified in clauses (a), (b) or (c), if the Notes are convertible
at the time of or in connection with such event, the Company shall cause to be filed with the
Trustee and to be mailed to each Holder of Notes at its address appearing on the Register, as
promptly as possible but in any event at least ten calendar days prior to the applicable date
hereinafter specified, a notice stating (x) the date on which a record is to be taken for the
purpose of such dividend, 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,
change, consolidation, merger, sale, transfer, conveyance or other disposition, 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, change, consolidation,
merger, sale, lease, transfer, conveyance or other disposition, 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, change, consolidation, merger, sale, lease,
transfer, conveyance or other disposition, dissolution, liquidation or winding up.

     SECTION 10.11 Settlement Upon Conversion. Upon any conversion of Notes, the Company will deliver to converting Holders in respect of each
$1,000 principal amount of Notes being converted, a “Conversion Settlement Amount” equal to the sum
of the Daily Settlement Amounts for each of the 20 Trading Days during the applicable Conversion
Period, subject to the Share Cap pursuant to Section 10.01(e).

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     The “Daily Settlement Amount” for each $1,000 principal amount of Notes, for each of the 20
Trading Days during the Conversion Period, shall consist of:

     (i) cash equal to the lesser of $50 and the Daily Conversion Value for such Trading
Day; and

     (ii) to the extent the 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 Volume Weighted Average Price of the Common Stock for such day.

     “Daily Conversion Value” means, for any Trading Day, one-twentieth (1/20) of the product of
(1) the applicable Conversion Rate on that Trading Day and (2) the Volume Weighted Average Price of
the Common Stock (or, if the Conversion Settlement Amount is then based (x) on the Reference
Property in accordance with Section 10.06, a unit of the Reference Property or (y) on shares of
Public Acquirer Common Stock in accordance with Section 10.12, a share of the Public Acquirer
Common Stock) on that Trading Day. For the purposes of determining the Daily Conversion Value, the
following provisions shall apply: (i) if the Reference Property includes securities for which the
price can be determined in a manner contemplated by the definition of “Volume Weighted Average
Price,” then the value of such securities shall be determined in accordance with the principles set
forth in such definition; (ii) if the Reference Property includes other property (other than
securities as to which clause (i) applies or cash), then the value of such property shall be the
Fair Market Value of such property; and (iii) if the Reference Property includes cash, then the
value of such cash shall be the amount thereof.

     The Conversion Settlement Amount will be delivered in cash and shares of Common Stock, if any,
to converting Holders on the third Trading Day following the final Trading Day of the applicable
Conversion Period.

     SECTION 10.12 Conversion After a Public Acquirer Change of Control.

     (a) In the event of a Public Acquirer Change of Control, the Company may, in lieu of adjusting
the Conversion Rate pursuant to Section 10.04(b) or 10.06, elect to adjust its conversion
obligation and the Conversion Rate such that from and after the Effective Date of such Public
Acquirer Change of Control, Holders of the Notes shall be entitled, subject to the conditions
relating to conversion of Notes specified herein (including Sections 10.01 and 10.02) to receive a
Conversion Settlement Amount upon conversion of Notes into shares of Public
Acquirer Common Stock and the Conversion Rate in effect immediately before the Public Acquirer
Change of Control shall be adjusted by multiplying it by a fraction:

     (1) the numerator of which shall be (A) in the case of a Public Acquirer Change of
Control pursuant to which the Common Stock is converted solely into cash, the value of such
cash paid or payable per share of Common Stock or (B) in the case of any other Public
Acquirer Change of Control, the average of the Closing Sale Prices of the Common Stock for
the five consecutive Trading Days prior to but excluding the Effective Date of such Public
Acquirer Change of Control; and

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     (2) the denominator of which shall be the average of the Closing Sale Prices of the
Public Acquirer Common Stock for the five consecutive Trading Days commencing on the Trading
Day next succeeding the Effective Date of such Public Acquirer Change of Control.

     (b) The Company shall notify Holders of its election by providing notice as set forth in
Section 10.01(d).

     (c) If the Company elects to make the adjustment to the Conversion Rate described in Section
10.12(a) in the event of a Public Acquirer Change of Control, (i) Holders of Notes will not be
entitled to receive any Additional Shares pursuant to Section 10.04(b) as a result of such Public
Acquirer Change of Control; (ii) Section 10.06 will not apply to such transaction; and (iii) the
Company and the acquirer or other issuer of Public Acquirer Common Stock 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) providing that such Notes shall, without the consent of any Holders of
Notes, be convertible into a Conversion Settlement Amount based on shares of Public Acquirer Common
Stock at the adjusted Conversion Rate as specified above (subject to the conditions relating to
conversion of Notes specified herein (including Section 10.01 and 10.02)). Such supplemental
indenture shall provide for adjustments that shall be as nearly equivalent as may be practicable to
the adjustments provided for in this Article 10, as determined in good faith by the Company, the
acquirer or other issuer of Public Acquirer Common Stock.

     SECTION 10.13 Stockholder Rights Plans.

     Each share of Common Stock issued upon conversion of Notes or Additional Notes pursuant to
this Article 10 shall be entitled to receive the appropriate number of rights, if any, and the
certificates representing the Common Stock issued upon such conversion shall bear such legends, if
any, in each case as may be provided by the terms of any stockholder rights plan adopted by the
Company, as the same may be amended from time to time. If at the time of conversion, however, the
rights have separated from the shares of Common Stock in accordance with the provisions of the
applicable stockholder rights agreement so that the Noteholders would not be entitled to receive
any rights in respect of Common Stock issuable upon conversion of the Notes or Additional Notes,
the Conversion Rate will be adjusted at the time of separation as if the Company has distributed to
all holders of Common Stock, shares of Capital Stock of the Company, evidence of indebtedness or
assets as provided in Section 10.05(d), subject to readjustment in the event of the expiration,
termination or redemption of such rights.

ARTICLE 11

MISCELLANEOUS

     SECTION 11.01 Trust Indenture Act Controls. If any provision of this Indenture limits, qualifies or conflicts with another provision which is
required to be included in this Indenture by the TIA, the required provision shall control.

     SECTION 11.02 Notices. Any notice or communication shall be in writing and delivered in person or mailed by first-class
mail addressed as follows:

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     if to the Company:

VeriFone Holdings, Inc.

2099 Gateway Place, Suite 600

San Jose, CA 95110

Attention: Barry Zwarenstein

     if to the Trustee:

U.S. Bank National Association

60 Livingston Avenue

EP-MN-WS3C

St. Paul, MN 55107-2292

Facsimile No.: (651) 495-8097

Attention: Richard Prokosch

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

     Any notice or communication mailed to a Noteholder shall be mailed to the Noteholder at the
Noteholder’s address as it appears on the Register of the Registrar and shall be sufficiently given
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.

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

     Notwithstanding any other provision of this Indenture or any Note, where this Indenture or any
Note provides for notice of any event to a Holder of a Global Note (whether by mail or otherwise),
such notice shall be sufficiently given if given to the Depositary for such Note (or its designee),
pursuant to the customary procedures of such Depositary, not later than the latest date (if any),
and not earlier than the earliest date (if any), prescribed for the giving of such notice.

     SECTION 11.03 Communication by Noteholders with Other Noteholders. Noteholders may communicate pursuant to TIA § 312(b) with other Noteholders with respect to their
rights under this Indenture or the Notes. The Company, the Trustee, the Registrar and anyone else
shall have the protection of TIA § 312(c).

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     SECTION 11.04 Certificate and Opinion as to Conditions Precedent. Upon any request or application by the Company to the Trustee to take or refrain from taking any
action under this Indenture, the Company shall furnish to the Trustee:

     (a) an Officers’ Certificate in form and substance reasonably satisfactory to the Trustee
stating that, in the opinion of the signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and

     (b) if requested by the Trustee, an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of such counsel, all such conditions
precedent have been complied with.

     SECTION 11.05 Statements Required in Certificate or Opinion. Each certificate or opinion with respect to compliance with a covenant or condition provided for
in this Indenture shall include:

     (a) a statement that the individual making such certificate or opinion has read such covenant
or condition;

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

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

     (d) a statement as to whether or not, in the opinion of such individual, such covenant or
condition has been complied with.

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

     Any certificate or opinion of an Officer of the Company may be based, insofar as it relates to
legal matters, upon a certificate of opinion of, or representations by, counsel. Any such
certificate or Opinion of Counsel may be based, and may state that it is so based, insofar as it
relates to factual matters, upon a certificate or opinion of, or representations by, an Officer or
Officers of the Company.

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

     SECTION 11.06 When Notes Disregarded. In determining whether the Noteholders of the required aggregate principal amount of Notes have
concurred in any

71

 

direction, waiver or consent, Notes owned by the Company or by any Person directly
or indirectly controlling or controlled by or under direct or indirect common control with the
Company shall be disregarded and deemed not to be outstanding, except that, for the purpose of
determining whether the Trustee shall be protected in relying on any such direction, waiver or
consent, only Notes which a Trust Officer of the Trustee knows are so owned shall be so
disregarded. Subject to the foregoing, only Notes outstanding at the time shall be considered in
any such determination.

     SECTION 11.07 Rules by Trustee, Paying Agent, Conversion Agent and Registrar. The Trustee may make reasonable rules for action by or a meeting of Noteholders. The Registrar,
the Paying Agent and the Conversion Agent may make reasonable rules for their functions.

     SECTION 11.08 Business Day. A “Business Day” means each Monday, Tuesday, Wednesday, Thursday and Friday that is not a day on
which banking institutions in New York City are authorized or obligated by law or executive order
to close.

     SECTION 11.09 Governing Law; Waiver of Jury Trial. THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK. EACH OF THE COMPANY AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE OR THE NOTES.

     SECTION 11.10 No Interpretation of or by Other Agreements. This Indenture may not be used to interpret any other indenture, loan or debt agreement of the
Company or its Subsidiaries or of any other Person. Any such indenture, loan or debt agreement may
not be used to interpret this Indenture.

     SECTION 11.11 Successors. All agreements of the Company in this Indenture and the Notes shall bind its successors. All
agreements of the Trustee in this Indenture shall bind its successors.

     SECTION 11.12 Multiple Originals. The parties may sign any number of copies of this Indenture. Each signed copy shall be an
original, but all of them together represent the same agreement. One signed copy is enough to prove
this Indenture.

     SECTION 11.13 Table of Contents; Headings. The table of contents, cross-reference sheet and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not intended to be considered a
part hereof and shall not modify or restrict any of the terms or provisions hereof.

     SECTION 11.14 Indenture and Notes Solely Corporate Obligations. No recourse for the payment of the principal of or interest on any Notes or for any claim based
upon any Notes 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
Notes or

72

 

because of the creation of any indebtedness represented thereby shall be had against any
incorporator, stockholder, member, manager, employee, partner, agent, officer, director or
subsidiary, as such, past, present or future, of the Company or any of the Company’s subsidiaries
or of any successor thereto, either directly or through the Company or any of the Company’s
subsidiaries or any successor thereto, 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.

     SECTION 11.15 Severability. In case any provision in this Indenture or in the Notes is invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining provisions will not in any way be
affected or impaired thereby and such provision shall be ineffective only to the extent of such
invalidity, illegality or unenforceability.

     SECTION 11.16 Benefits of Indenture. Nothing in this Indenture or in the Notes, express or implied, shall give to any Person, other
than the parties hereto and their successors hereunder and the Holders of Notes, any benefit or any
legal or equitable right, remedy or claim under this Indenture or the Notes.

     SECTION 11.17 Calculations. Except as otherwise provided herein, the Company shall be responsible for making all
calculations called for under this Indenture and the Notes. The Company or its agents shall make
all such calculations in good faith and, absent manifest error, its calculations will be final and
binding on the Holders. The Company shall provide a schedule of its calculations to each of the
Trustee and the Conversion Agent, and each of the Trustee and the Conversion Agent shall be
entitled to rely conclusively upon the accuracy of the Company’s calculations without independent
verification. The Trustee or the Conversion Agent, as applicable, shall deliver a copy of such
schedule to any Holder upon the request of such Holder.

     SECTION 11.18 Qualification of Indenture. The Company shall qualify this Indenture under the Trust Indenture Act in accordance with
the terms and conditions of the Registration Rights Agreement(s) and shall pay all reasonable costs
and expenses incurred in connection therewith, including, but not limited to, costs and expenses of
qualification of this Indenture and the registration of the resale of the Notes and the printing of
this Indenture and the Notes.

[Signature Page Follows]

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

	 	 	 	 	 
	 	 	VERIFONE HOLDINGS, INC., as Issuer
	 
	 	 	 	 
	 

	 	By:	 	/s/ Barry Zwarenstein
	 

	 	 	 	 
	 

	 	Name:	 	Barry Zwarenstein
	 

	 	Title:	 	Executive Vice President and Chief
Financial Officer
	 
	 	 	 	 
	 	 	U.S. BANK NATIONAL ASSOCIATION, as Trustee
	 
	 	 	 	 
	 

	 	By:	 	/s/ Richard Prokosch
	 

	 	 	 	 
	 

	 	Name:	 	Richard Prokosch
	 

	 	Title:	 	Vice President

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EXHIBIT A

[FACE OF NOTE]

[Global Notes Legend]

     UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, 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 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.

     TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET
FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.

[Restricted Notes Legend]

     THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES
ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR ANY STATE SECURITIES LAWS. NEITHER THIS SECURITY
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS THE TRANSACTION
IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. EACH
PURCHASER OF THE SECURITY EVIDENCED HEREBY IS NOTIFIED THAT THE SELLER MAY BE RELYING ON THE
EXEMPTION FROM SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THIS
SECURITY BY ITS ACCEPTANCE HEREOF:

(1) REPRESENTS THAT IT IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT OF 1933;

(2) AGREES THAT IT WILL NOT PRIOR TO THE DATE TWO YEARS AFTER THE DATE OF ORIGINAL
ISSUANCE OF THE 1.375% SENIOR CONVERTIBLE NOTES DUE 2012 OF VERIFONE HOLDINGS, INC.
(THE “COMPANY”) RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY OR THE
COMMON STOCK THAT MAY BE

A-F-1

 

ISSUABLE UPON CONVERSION OF SUCH SECURITY EXCEPT (A) TO THE COMPANY OR ANY
SUBSIDIARY THEREOF, (B) TO A PERSON IT REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT OF 1933,
(C) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT OF 1933 AND WHICH CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH
TRANSFER, OR (D) PURSUANT TO ANY OTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS
UNDER THE SECURITIES ACT, INCLUDING UNDER RULE 144, IF AVAILABLE, SUBJECT TO OUR AND
THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH TRANSFER, TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATIONS AND/OR OTHER INFORMATION SATISFACTORY TO US AND
THE TRUSTEE; AND

(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE SECURITY EVIDENCED HEREBY
IS TRANSFERRED (OTHER THAN A TRANSFER PURSUANT TO CLAUSE 2(C) ABOVE) A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

     PROVIDED THAT THE COMPANY, THE TRUSTEE AND THE REGISTRAR SHALL HAVE THE RIGHT PRIOR TO ANY SUCH
OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (2)(D) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED
UPON THE REQUEST OF THE HOLDER AFTER THE EXPIRATION OF TWO YEARS FROM THE LAST DATE OF ORIGINAL
ISSUANCE OF THE NOTES (INCLUDING ANY ADDITIONAL NOTES ISSUED PURSUANT TO SECTION 2.14 OF THE
INDENTURE).

A-F-2 

 

	 	 	 	 	 
	No.                    

	 	 
	 	$                    
	 

	 	1.375% Senior Convertible Note due 2012	 	 
	 
	 	 	 	 
	 

	 	 	 	CUSIP No.:                     

     VeriFone Holdings, Inc., a Delaware corporation, promises to pay to [___],
principal sum of ___, Dollars [, as revised by the Schedule of Increases or Decreases in
Global Note attached hereto,]* on June 15, 2012. Interest Payment Dates: June 15 and
December 15.

     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, if applicable, Common Stock, 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 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.

 

			
	*	 	Include for Global Notes.

A-R-3 

 

     IN WITNESS WHEREOF, VeriFone Holdings, Inc. has caused this instrument to be duly executed.

	 	 	 	 	 
	 	VERIFONE HOLDINGS, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

Dated: June 22, 2007

A-R-4

 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

U.S. BANK NATIONAL ASSOCIATION

     as Trustee, certifies that this is one of

     the Notes referred to in the Indenture.

	 	 	 	 	 
	 	 	 
	 	By:  	 	 
	 	 	Authorized Signatory 	 
	 	 	 	 
	 

A-R-5

 

[REVERSE SIDE OF NOTE]

1.375% Senior Convertible Note due 2012

1. Interest

     (a) VERIFONE HOLDINGS, INC., a Delaware corporation (such corporation, and its successors and
assigns under the Indenture hereinafter referred to, being herein called the “Company”), promises
to pay interest on the principal amount of this Note at the rate of 1.375 percent per annum. The
Company will pay interest semiannually on June 15 and December 15 of each year commencing on
December 15, 2007. Interest on the Notes will accrue from the most recent date to which interest
has been paid or, if no interest has been paid, from June 22, 2007. Interest will be computed on
the basis of a 360-day year of twelve 30-day months. The amount of interest payable for any
period that is less than a whole month shall be computed on the basis of the actual number of days
elapsed during such less than whole-month period divided by 360.

     If a payment date is not a Business Day, payment will be made on the next succeeding Business
Day, and no additional interest will accrue in respect of such payment by virtue of the payment
being made on such later date.

     (b) Additional Interest, Reporting Additional Interest and Share Cap Additional
Interest. The Holder of this Note shall be entitled to receive Additional Interest, Reporting
Additional Interest and Share Cap Additional Interest as and to the extent provided in the
Indenture and that certain Registration Rights Agreement, dated as of June 22, 2007, between the
Company and the Initial Purchasers.

2. Method of Payment

     The Company will pay interest on the Notes (except Defaulted Interest) to the Persons who are
registered Holders of Notes at the close of business on the Regular Record Date even if Notes are
canceled after the Regular Record Date and on or before the Interest Payment Date, except as
otherwise provided in the Indenture. Holders must surrender Notes to a Paying Agent to collect
principal payments. The Company will pay principal and interest in money of the United States of
America that at the time of payment is legal tender for payment of public and private debts. The
Company shall pay interest (i) on any Global Notes by wire transfer of immediately available funds
to the account of the Depositary or its nominee, (ii) on any Notes in certificated form having a
principal amount of less than $5,000,000, by check mailed to the address of the Person entitled
thereto as it appears in the Register, provided, however, that at maturity interest will be payable
at the office of the Company maintained by the Company for such purposes, which shall initially be
an office or agency of the Trustee (as defined below) and (iii) on any Notes in certificated form
having a principal amount of $5,000,000 or more, by wire transfer in immediately available funds at
the election of the Holder of such Notes duly delivered to the Trustee at least five Business Days
prior to the relevant Interest Payment Date, provided, however, that at maturity interest will be
payable at the office of the Company maintained by the Company for such purposes, which shall
initially be an office or agency of the Trustee.

 

 

3. Paying Agent and Registrar

     Initially, U.S. Bank National Association (the “Trustee”) will act as Paying Agent, Registrar
and Conversion Agent. The Company may appoint and change any Paying Agent, Registrar or
co-registrar or Conversion Agent without notice. The Company or any of its domestically organized
Wholly Owned Subsidiaries may act as Paying Agent or Registrar or co-registrar.

4. Indenture

     The Company issued the Notes under an Indenture dated as of June 22, 2007 (the “Indenture”),
between the Company and the Trustee. The terms of the Notes include those stated in the Indenture
and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. §§
77aaa-77bbbb) as in effect on the date of the Indenture (the “TIA”). Terms defined in the Indenture
and not defined herein have the meanings ascribed thereto in the Indenture. The Notes are subject
to all such terms, and Noteholders are referred to the Indenture and the TIA for a statement of
those terms.

     The Notes are senior unsecured obligations of the Company. This Note is one of the Notes
referred to in the Indenture initially issued in an aggregate
principal amount of (i) $316,250,000 plus
(ii) such additional aggregate principal amount of Notes as may be issued from time to time as
Additional Notes in accordance with Section 2.14 of the Indenture.

5. Redemption

     The Notes will not be redeemable at the option of the Company prior to the Maturity Date.

6. Repurchase at the Option of Noteholders Upon a Fundamental Change

     If a Fundamental Change occurs at any time prior to maturity of the Notes, this Note will be
subject to a repurchase, at the option of the Holder, on a Fundamental Change Repurchase Date,
specified by the Company, that is not less than 20 calendar days nor more than 35 calendar days
after notice thereof, at a repurchase price equal to 100% of the principal amount hereof, together
with accrued and unpaid interest on this Note to, but excluding, the Fundamental Change Repurchase
Date; provided that if such Fundamental Change Repurchase Date falls after a Regular Record Date
and on or prior the corresponding Interest Payment Date, the accrued and unpaid interest shall be
payable to the Holder of record of this Note on the applicable Regular Record Date. For Notes to
be so repurchased at the option of the Holder, the Holder must deliver to the Paying Agent in
accordance with the terms of the Indenture, the Repurchase Notice containing the information
specified by the Indenture, together with such Notes, duly endorsed for transfer, or (if the Notes
are Global Notes) book-entry transfer of the Notes, prior to 5:00 p.m., New York City time, on the
Fundamental Change Repurchase Date.

     Holders have the right to withdraw any Repurchase Notice by delivering to the Paying Agent a
written notice of withdrawal at any time prior to 5:00 p.m., New York City time, on the Fundamental
Change Repurchase Date, all as provided in the Indenture.

 

 

7. Conversion

     Subject to and upon compliance with the provisions of the Indenture, the Holder hereof has the
right, at its option, to convert each $1,000 principal amount of this Note into cash and, if
applicable, Common Stock based on a Conversion Rate of 22.7190 shares of Common Stock per $1,000
principal amount of Notes (equivalent to a Conversion Price of approximately $44.02 per share), as
the same may be adjusted pursuant to the terms of the Indenture. As specified in the Indenture,
upon conversion, the Company will pay cash and shares of Common Stock, if any, based on a Daily
Conversion Value (as defined in the Indenture) calculated on a proportionate basis for each day of
the 20 Trading-Day Conversion Period (as defined in the Indenture).

     If and only to the extent Holders elect to convert the Notes in connection with a Non-Stock
Change of Control (as defined in the Indenture), the Company may be required to increase the
Conversion Rate applicable to such converting Notes; provided that in the case of a Non-Stock
Change of Control constituting a Public Acquirer Change of Control (as defined in the Indenture),
the Company may, in lieu of increasing the Conversion Rate, elect to adjust the conversion
obligation and the Conversion Rate such that from and after the effective date of such Public
Acquirer Change of Control, Holders of the Notes will be entitled to convert their Notes (subject
to the satisfaction of certain conditions) based on a number of shares of Public Acquirer Common
Stock (as defined in the Indenture) determined as set forth in the Indenture.

     If this Note (or portion hereof) is surrendered for conversion after 5:00 p.m., New York City
time, on the Regular Record Date for an Interest Payment Date but prior to the applicable Interest
Payment Date, it shall be accompanied by payment, in immediately available funds or other funds
acceptable to the Company, of an amount equal to the interest otherwise payable on such Interest
Payment Date on the principal amount being converted; provided that no such payment need be made
(i) with respect to conversions after 5:00 p.m., New York City time, on the Regular Record Date
immediately preceding the Maturity Date; (ii) with respect to a conversion in connection with a
Fundamental Change and the Company has specified a Fundamental Change Repurchase Date that is after
a Regular Record Date and on or prior to the corresponding Interest Payment Date; and (iii) with
respect to any overdue interest, if overdue interest exists at the time of conversion with respect
to such Notes.

     No fractional shares will be issued upon any conversion of Notes, but an adjustment and
payment in cash will be made, 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.

     A Note in respect of which a Holder is exercising its right to require repurchase may be
converted only if such Holder validly withdraws its election to exercise such right to require
repurchase in accordance with the terms of the Indenture.

8. Denominations, Transfer, Exchange

     The Notes are in registered form without coupons in denominations of $1,000 and whole
multiples of $1,000. A Noteholder may transfer or exchange Notes in accordance with the Indenture.
Upon any transfer or exchange, the Registrar and the Trustee may require a

 

 

Noteholder, among other things, to furnish appropriate endorsements or transfer documents and
to pay any taxes required by law or permitted by the Indenture.

9. Persons Deemed Owners 

     The registered Holder of this Note may be treated as the owner of it for all purposes.

10. Unclaimed Money

     Subject to any applicable abandoned property law, the Trustee and the Paying Agent shall pay
to the Company upon written request any money held by them for the payment of principal or interest
and any shares of Common Stock or other property due in respect of converted Notes that remains
unclaimed for two years, and, thereafter, Noteholders entitled to the money and/or securities must
look to the Company for payment as general creditors.

11. Amendment, Waiver

     Subject to certain exceptions set forth in the Indenture, (i) the Indenture or the Notes may
be amended without prior notice to any Noteholder but with the written consent or affirmative vote
of the Holders of at least a majority in aggregate principal amount of the outstanding Notes and
(ii) any Default or Event of Default may be waived with the written consent of the Holders of at
least a majority in aggregate principal amount of the outstanding Notes. In certain circumstances
set forth in the Indenture, the Company and the Trustee may amend the Indenture or the Notes
without the consent of any Holder of Notes.

12. Defaults and Remedies

     If an Event of Default occurs (other than an Event of Default relating to certain events of
bankruptcy, insolvency or reorganization) and is continuing, the Trustee or the Holders of at least
25% in aggregate principal amount of the outstanding Notes may declare the principal of and accrued
but unpaid interest on all the Notes to be due and payable, except as provided in the Indenture
(including special provisions for an Event of Default relating to the failure of the Company to
comply with its agreements in respect of periodic reporting under Section 4.08(a) of the Indenture
as set forth in Section 6.13 of the Indenture). If an Event of Default relating to certain events
of bankruptcy, insolvency or reorganization occurs, the principal of and interest on all the Notes
will become immediately due and payable without any declaration or other act on the part of the
Trustee or any Noteholders. Under certain circumstances, the Holders of a majority in aggregate
principal amount of the outstanding Notes may rescind and annul such declaration with respect to
the Notes and its consequences. No reference herein to the Indenture and no provision of this Note
or of the Indenture shall impair, as among the Company and the Holder of the Notes, the obligation
of the Company, which is absolute and unconditional, to pay the principal of and interest on this
Note at the place, at the respective times, at the rate and in the coin or currency herein and in
the Indenture prescribed or to convert the Note as provided in the Indenture.

 

 

13. Trustee Dealings with the Company

     Subject to certain limitations imposed by the TIA, the Trustee under the Indenture, in its
individual or any other capacity, may become the owner or pledgee of Notes and may otherwise deal
with and collect obligations owed to it by the Company or its Affiliates and may otherwise deal
with the Company or its Affiliates with the same rights it would have if it were not Trustee.

14. Indenture and Notes Solely Corporate Obligations

     No recourse for the payment of the principal of or interest on any Notes or for any claim
based upon any Notes or otherwise in respect thereof, and no recourse under or upon any obligation,
covenant or agreement of the Company in the Indenture or in any supplemental indenture or in any
Notes or because of the creation of any indebtedness represented thereby shall be had against any
incorporator, stockholder, member, manager, employee, agent, officer, director or subsidiary, as
such, past, present or future, of the Company or any of the Company’s subsidiaries or of any
successor thereto, either directly or through the Company or any of the Company’s subsidiaries or
any successor thereto, 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 the Indenture and the issue of the Notes.

15. Authentication

     This Note shall not be valid until an authorized signatory of the Trustee (or an
authenticating agent) manually signs the certificate of authentication on the other side of this
Note.

16. Abbreviations

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

17. GOVERNING LAW

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

18. CUSIP and ISIN Numbers

     Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification
Procedures, the Company has caused CUSIP and ISIN numbers to be printed on the Notes and has
directed the Trustee to use CUSIP and ISIN numbers in all notices issued to Noteholders as a
convenience to such Noteholders. No representation is made as to the accuracy of such numbers
either as printed on the Notes or as contained in any such notice and reliance may be placed only
on the other identification numbers placed thereon.

 

 

     The Company will furnish to any Holder of Notes upon written request and without charge to the
Holder a copy of the Indenture.

 

 

CONVERSION NOTICE

TO: VERIFONE HOLDINGS, INC. and U.S. BANK NATIONAL ASSOCIATION, as Trustee

     The undersigned registered owner of this Note hereby irrevocably exercises the option to
convert this Note, or the portion thereof (which is $1,000 or a multiple thereof) below designated,
into, cash and shares of Common Stock of VeriFone Holdings, Inc., if any, in accordance with the
terms of the Indenture referred to in this Note, and directs that the check in payment for cash and
the shares, if any, issuable and deliverable upon such conversion, deliverable upon conversion or
for fractional shares and 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.
Capitalized terms used herein but not defined shall have the meanings ascribed to such terms in the
Indenture. 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 provide the appropriate information below
and pay all taxes or duties payable with respect thereto. Any amount required to be paid by the
undersigned on account of interest accompanies this Note.

Dated:                     

	 	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	Signature(s)
	 	 
	 
	 	 	 	 
	 

	 	Signature(s) must be guaranteed by an “eligible
guarantor institution” meeting the requirements of the
Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion
Program (“STAMP”) or such other “signature guarantee
program” as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as
amended.	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	Signature Guarantee	 	 

 

 

     Fill in the registration of shares of Common Stock, if any, if to be issued, and Notes if to
be delivered, and the person to whom cash, if any, and payment for fractional shares is to be made,
if to be made, other than to and in the name of the registered Holder:

Please print name and address

(Name)

(Street Address)

(City, State and Zip Code)

Principal amount to be converted

(if less than all):

$

Social Security or Other Taxpayer

Identification Number:

NOTICE: The signature on this Conversion Notice must correspond with the name as written upon the
face of the Notes in every particular without alteration or enlargement or any change whatever.

 

 

REPURCHASE NOTICE

TO: VERIFONE HOLDINGS, INC. and U.S. BANK NATIONAL ASSOCIATION, as Trustee

     The undersigned registered owner of this Note hereby irrevocably acknowledges receipt of a
notice from VeriFone Holdings, Inc. (the “Company”) regarding the right of Holders to elect to
require the Company to repurchase the Notes and requests and instructs the Company to repay the
entire principal amount of this Note, or the portion thereof (which is $1,000 or an integral
multiple thereof) below designated, in accordance with the terms of the Indenture at the price of
100% of such entire principal amount or portion thereof, together with, except as provided in the
Indenture, accrued and unpaid interest to, but excluding, the Fundamental Change Repurchase Date to
the registered Holder hereof. Capitalized terms used herein but not defined shall have the meanings
ascribed to such terms in the Indenture. The Notes shall be repurchased by the Company as of the
Fundamental Change Repurchase Date pursuant to the terms and conditions specified in the Indenture.

Dated:                     

	 	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	Signature(s)
	 	 

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

Notes Certificate Number (if applicable):                     

Principal amount to be repurchased

(if less than all, must be $1,000 or whole multiples thereof):                     

Social Security or Other Taxpayer Identification Number:                     

 

 

ASSIGNMENT

     For value received ___hereby sell(s) assign(s) and transfer(s) unto
___(Please insert social security or other Taxpayer Identification Number of
assignee) the within Notes, and hereby irrevocably constitutes and appoints ___
attorney to transfer said Notes on the books of the Company, with full power of substitution in the
premises.

     In connection with any transfer of the Notes prior to the expiration of the holding period
applicable to sales thereof under Rule 144(k) under the Securities Act (or any successor provision)
(other than any transfer pursuant to a registration statement that has become effective under the
Securities Act), the undersigned confirms that such Notes are being transferred:

	 	 	 	o To VeriFone Holdings, Inc. or a subsidiary thereof; or
	 
	 	 	 	o To a “qualified institutional buyer” in compliance with Rule 144A under the
Securities Act of 1933, as amended; or
	 
	 	 	 	o Pursuant to and in compliance with Rule 144 under the Securities Act of 1933, as
amended; or
	 
	 	 	 	o Pursuant to a Registration Statement which has become effective under the Securities
Act of 1933, as amended, and which continues to be effective at the time of
transfer.

     Unless one of the boxes is checked, the Trustee will refuse to register any of the Notes
evidenced by this certificate in the name of any person other than the registered Holder thereof.

 

 

Dated: __________

	 	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	Signature(s)
	 	 
	 
	 	 	 	 
	 

	 	Signature(s) must be guaranteed by an “eligible
guarantor institution” meeting the requirements
of the Registrar, which requirements include
membership or participation in the Security
Transfer Agent Medallion Program (“STAMP”) or
such other “signature guarantee program” as may
be determined by the Registrar in addition to, or
in substitution for, STAMP, all in accordance
with the Securities Exchange Act of 1934, as
amended.	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	Signature Guarantee	 	 

NOTICE: The signature on this Assignment must correspond with the name as written upon the face of
the Notes in every particular without alteration or enlargement or any change whatever.

 

 

SCHEDULE OF INCREASES AND DECREASES IN GLOBAL NOTE

     The following increases or decreases in this Global Note have been made:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Amount of decrease in Principal	 	 	Amount of increase in Principal	 	 	Principal Amount of	 	 	Signature of authorized	 
	 	 	Amount of this Global	 	 	Amount of this Global	 	 	Note following such decrease or	 	 	 signatory of Trustee or Securities	 
	Date	 	Note	 	 	Note	 	 	increase	 	 	Custodian	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

 

EXHIBIT B

FORM OF RESTRICTIVE LEGEND FOR

COMMON STOCK ISSUED UPON CONVERSION

THE SECURITY EVIDENCED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT OF 1933”), OR ANY STATE
SECURITIES LAWS, AND MAY NOT BE OFFERED OR SOLD EXCEPT AS SET FORTH IN THE FOLLOWING
SENTENCE. BY ACQUISITION HEREOF OR A BENEFICIAL INTEREST HEREIN, THE HOLDER:

(1) REPRESENTS THAT IT IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT OF 1933;

(2) AGREES THAT IT WILL NOT PRIOR TO THE DATE TWO YEARS AFTER THE DATE OF ORIGINAL
ISSUANCE OF THE 1.375% SENIOR CONVERTIBLE NOTES DUE 2012 OF VERIFONE HOLDINGS, INC.
(THE “COMPANY”) RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY EXCEPT
(A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) TO A PERSON IT REASONABLY BELIEVES
IS A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES
ACT OF 1933, (C) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT OF 1933 AND WHICH CONTINUES TO BE EFFECTIVE AT
THE TIME OF SUCH TRANSFER, OR (D) PURSUANT TO ANY OTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT, INCLUDING UNDER RULE 144, IF
AVAILABLE, SUBJECT TO OUR AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH TRANSFER, TO
REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS AND/OR OTHER
INFORMATION SATISFACTORY TO US AND THE TRUSTEE; AND (3) AGREES THAT IT WILL DELIVER
TO EACH PERSON TO WHOM THE SECURITY EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN A
TRANSFER PURSUANT TO CLAUSE 2(C) ABOVE) A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.exv4w2

 

Exhibit 4.2

Registration Rights Agreement

between

VeriFone Holdings, Inc.

and

Lehman Brothers Inc. and J.P. Morgan Securities Inc.

Dated as of June 22, 2007

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page
	1. Definitions 
	 	 	1	 
	 
	 	 	 	 
	2. Shelf Registration 
	 	 	4	 
	 
	 	 	 	 
	3. Additional Amounts 
	 	 	7	 
	 
	 	 	 	 
	4. Registration Procedures 
	 	 	9	 
	 
	 	 	 	 
	5. Registration Expenses 
	 	 	16	 
	 
	 	 	 	 
	6. Indemnification and Contribution 
	 	 	17	 
	 
	 	 	 	 
	7. Underwritten Offerings 
	 	 	21	 
	 
	 	 	 	 
	8. Miscellaneous 
	 	 	22	 

i

 

     Registration Rights Agreement, dated as of June 22, 2007, between VeriFone Holdings, Inc., a
Delaware corporation (together with any successor entity, herein referred to as the “Company”), and
Lehman Brothers Inc. and J.P. Morgan Securities Inc. (the “Initial Purchaserss”).

     Pursuant to the Purchase Agreement, dated June 18, 2007, between the Company and the Initial
Purchasers (the “Purchase Agreement”), the Initial Purchasers has agreed to purchase from the
Company $275,000,000 aggregate principal amount of 1.375% Convertible Senior Notes due 2012 (the
“Firm Notes”), and, at the election of the Initial Purchasers, an additional $41,250,000 aggregate
principal amount of 1.375% Convertible Senior Notes Due 2012 (the “Additional Notes”, and together
with the Firm Notes, the “Notes”)

     To induce the Initial Purchasers to purchase the Notes, the Company has agreed to provide the
registration rights set forth in this Agreement pursuant to the Purchase Agreement.

     The parties hereby agree as follows:

     1. Definitions. As used in this Agreement, the following capitalized terms shall have the
following meanings:

     Additional Amounts: As defined in Section 3(a) hereto.

     Additional Amounts Payment Date: Each June 15 and December 15, commencing on December 15,
2007.

     Affiliate: As such term is defined in Rule 405 under the Securities Act.

     Agreement: This Registration Rights Agreement, as amended, modified or otherwise supplemented
from time to time in accordance with the terms hereof.

     Business Day: A day other than a Saturday or Sunday or any day on which banking institutions
in The City of New York are authorized or obligated by law or executive order to close.

     Commission: Securities and Exchange Commission.

     Common Stock: Common stock, par value $0.01 per share, of the Company.

     Company: As defined in the preamble hereto.

     Effectiveness Period: As defined in Section 2(a)(ii) hereto.

     Effectiveness Target Date: As defined in Section 2(a)(i) hereto.

     Exchange Act: Securities Exchange Act of 1934, as amended, and the rules and regulations of
the Commission thereunder.

     Free Writing Prospectus: As defined in Rule 405 of the Securities Act.

 

 

     Holder: Any Person (including the Initial Purchasers) who owns from time to time,
beneficially or otherwise, Transfer Restricted Securities.

     Indemnified Holder: As defined in Section 6(a) hereto.

     Indenture: The Indenture, dated as of June 22, 2007, between the Company and U.S. Bank
National Association, as trustee (the “Trustee”), pursuant to which the Notes are to be issued, as
such Indenture is amended, modified or supplemented from time to time in accordance with the terms
thereof.

     Initial Purchasers: As defined in the preamble hereto.

     Interest Payment Date: Each June 15 and December 15 of each year, commencing December 15,
2007.

     Issuer Free Writing Prospectus: As defined in Rule 433 of the Securities Act.

     Majority of Holders: Holders holding more than 50% of the aggregate principal amount at
maturity of Notes outstanding; provided, that for purpose of this definition, a holder of shares of
Common Stock which constitute Transfer Restricted Securities when issued upon conversion of the
Notes shall be deemed to hold an aggregate principal amount at maturity of Notes (in addition to
the principal amount at maturity of Notes held by such holder) equal to (x) the number of such
shares of Common Stock received upon conversion of the Notes and then held by such holder
multiplied by (y) the prevailing Conversion Price, such prevailing Conversion Price as defined in
and determined in accordance with the Indenture.

     NASD: National Association of Securities Dealers, Inc.

     Notes: As defined in the preamble hereto.

     Notice Holder: As defined in Section 2(a)(i) hereto.

     NYSE: New York Stock Exchange.

     Person: An individual, partnership, corporation, unincorporated organization, limited
liability company, trust, joint venture or a government or agency or political subdivision thereof.

     Prospectus: The prospectus relating to the Transfer Restricted Securities included in a Shelf
Registration Statement (including any prospectus pursuant to Rule 429 under the Securities Act), as
amended or supplemented by any prospectus supplement and by all other amendments thereto, including
post-effective amendments, and all material incorporated by reference into such Prospectus.

     Purchase Agreement: As defined in the preamble hereto.

     Questionnaire: As defined in Section 2(b) hereof.

     Registration Default: As defined in Section 3(a) hereof.

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     Securities Act: Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder.

     Shelf Registration Statement: As defined in Section 2(a)(i) hereof.

     Suspension Period: As defined in Section 4(b)(i) hereof.

     TIA: Trust Indenture Act of 1939, as amended, and the rules and regulations of the Commission
thereunder, in each case, as in effect on the date the Indenture is qualified under the TIA.

     Transfer Restricted Securities: Each Note and each share of Common Stock issued upon
conversion of Notes until the earliest of:

     (a) the date on which such Note or such share of Common Stock issued upon conversion
thereof has been effectively registered under the Securities Act and sold or otherwise
transferred in accordance with the Shelf Registration Statement;

     (b) the date on which such Note or such share of Common Stock issued upon conversion
thereof (A) is transferred in compliance with Rule 144 under the Securities Act or (B) may
be sold or transferred by a person who is not an Affiliate of the Company pursuant to Rule
144 under the Securities Act (or any other similar provision then in force) without any
volume or manner of sale restrictions thereunder; or

     (c) the date on which such Note or such share of Common Stock issued upon conversion
ceases to be outstanding (whether as a result of redemption, repurchase and cancellation,
conversion or otherwise); provided, that any Note and any Common Stock issued upon
conversion of such Note that is redeemed or repurchased by the Company shall not be deemed
Transfer Restricted Securities for purposes of this Agreement upon resale by the Company.

     Underwriter: The managing underwriter in an Underwritten Registration or Underwritten
Offering.

     Underwritten Registration or Underwritten Offering: A registration pursuant to Section 7 of
this Agreement in which Notes or shares of Common Stock issued upon conversion of Notes are sold by
a Majority of Holders to an Underwriter for reoffering to the public.

     2. Shelf Registration.

     (a) The Company shall:

     (i) use its reasonable best efforts to cause a registration statement pursuant
to Rule 415 under the Securities Act (together with any amendments thereto, and
including any documents incorporated by reference therein, the “Shelf Registration
Statement”; provided, however, that a registration statement shall not be deemed a
Shelf Registration Statement until such time as it includes a Prospectus relating
to the Securities), which Shelf Registration

3

 

Statement shall provide for resales from time to time of all Transfer
Restricted Securities held by Holders that have provided the information required
pursuant to the terms of Section 2(b) hereof (each such holder a “Notice Holder”)
to be declared effective by the Commission not later than 180 days after the date
hereof (the “Effectiveness Target Date”).

     (ii) use its reasonable best efforts to keep the Shelf Registration Statement
continuously effective, supplemented and amended as required by the provisions of
Section 4(b) hereof to the extent necessary to ensure that (A) it is available for
resales by the Notice Holders of Transfer Restricted Securities entitled to the
benefit of this Agreement and (B) it conforms with the requirements of this
Agreement and the Securities Act for a period (the “Effectiveness Period”) ending
on the earliest of:

     (1) the date when all of the Holders of Transfer Restricted
Securities are able to sell all Transfer Restricted Securities
immediately without restriction pursuant to Rule 144(k) under the
Securities Act or any successor rule thereto;

     (2) the date when all Transfer Restricted Securities registered
under the Shelf Registration Statement have been transferred pursuant
to such Shelf Registration Statement; and

     (3) the date when all Transfer Restricted Securities have ceased
to be outstanding (whether as a result of redemption, repurchase and
cancellation, conversion or otherwise).

     (b) Notwithstanding any other provision hereof, the Company’s obligations to include a
Holder’s Transfer Restricted Securities in the Shelf Registration Statement is subject to
such Holder completing the Selling Securityholder Notice and Questionnaire, the form of
which is contained in Annex A to the Offering Memorandum relating to the Notes (the
“Questionnaire”). The Company shall mail the Questionnaire to all Holders of Transfer
Restricted Securities at least 20 Business Days (but no more than 40 Business Days) prior to
the time the Company intends in good faith to have the Shelf Registration Statement declared
effective by the Commission, or to the extent the Company elects to register the Transfer
Restricted Securities pursuant to a Prospectus to a Shelf Registration Statement that has
already been declared effective and is filed in reliance on Rule 430B under the Securities
Act, the Company will mail notice to the Holders of its intention to file the initial
Prospectus at least 20 Business Days (but no more than 40 Business Days) before such filing.
Upon receipt of a written request for additional information from the Company, each Holder
who intends to be named as a selling Holder in the Shelf Registration Statement or
Prospectus, as applicable, shall furnish to the Company in writing, within 20 Business Days
after the date of the Questionnaire, such additional information regarding such Holder and
the proposed distribution by such Holder of its Transfer Restricted Securities, in
connection with the Shelf Registration Statement or Prospectus included therein and in any
application to be filed with or under state securities law, as the Company may reasonably
request. In connection with all such

4

 

requests for information from Holders of Transfer Restricted Securities, the Company
shall notify such Holders of the requirements set forth in this paragraph regarding their
obligation to provide the information requested pursuant to this Section. Holders who have
not delivered a Questionnaire at least 10 days prior to the effectiveness of the Shelf
Registration Statement or the filing of the Prospectus, as applicable, will not be named as
selling Holders in the related Prospectus. Thereafter, such Holders may receive a
Questionnaire from the Company upon request. Upon receipt of such a completed Questionnaire
from a Holder following the tenth day prior to the effectiveness of the Shelf Registration
Statement or the Prospectus, as applicable, the Company shall, as promptly as reasonably
practicable, and in any event within 20 Business Days after such date, file with the
Commission such amendments to the Shelf Registration Statement or supplements to a related
Prospectus as are necessary to permit such Holder to transfer its Transfer Restricted
Securities pursuant to the Shelf Registration Statement, provided, however, that if such an
amendment or supplement to the Shelf Registration Statement or Prospectus is required, the
Company will not be obligated to file more than one such amendment or supplement for all
such Holders during one fiscal quarter unless the principal amount at maturity of the
Transfer Restricted Securities to be included in such amendment is more than $25 million;
provided further, that if the Company receives a Questionnaire during a Suspension Period or
the Company initiates a Suspension Period within 20 Business Days after the Company receives
the Questionnaire, then the Company will, except as described below, make such filing within
20 Business Days after the end of the Suspension Period. Each Holder as to which the Shelf
Registration Statement or Prospectus is being effected agrees to furnish promptly to the
Company all information required to be disclosed in order to make information previously
furnished to the Company by such Holder not materially misleading.

     (c) Each Holder agrees that if such Holder wishes to sell Transfer Restricted
Securities pursuant to a Shelf Registration Statement and related Prospectus it will do so
only in accordance with Section 2(b). Each Holder agrees not to sell any Transfer
Restricted Securities pursuant to the Shelf Registration Statement without delivering, or
causing to be delivered, a Prospectus to the purchaser thereof and, following termination of
the Effectiveness Period, to notify the Company, within ten days of a written request by the
Company, of the amount of Transfer Restricted Securities sold pursuant to the Shelf
Registration Statement and, in the absence of a response, the Company may assume that all of
such Holder’s Transfer Restricted Securities have been so sold.

     (d) The Company represents and agrees that, unless it obtains the prior consent of a
majority of the Holders of the Transfer Restricted Securities the resale of which are
registered under the Shelf Registration Statement at such time, or the consent of the
managing Underwriter in connection with any underwritten offering of Transfer Restricted
Securities, and each Holder represents and agrees that, unless it obtains the prior consent
of the Company and any such Underwriter, it will not make any offer relating to the Notes or
the Common Stock that would constitute an Issuer Free Writing Prospectus, or that would
otherwise constitute a “free writing prospectus,” as defined in Rule 405, required to be
filed with the SEC. The Company represents that any Issuer Free Writing Prospectus will not
include any information that conflicts with the information contained in the Shelf
Registration Statement or the related Prospectus and,

5

 

any Issuer Free Writing Prospectus, when taken together with the information in the
Shelf Registration Statement and the Prospectus, will not include any untrue statement of a
material fact or omit to state any material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not misleading.

     3. Additional Amounts.

     (a) If:

     (i) the Shelf Registration Statement has not been declared effective by the
Commission prior to or on the Effectiveness Target Date;

     (ii) except as provided in Section 4(b)(i) hereof, the Shelf Registration
Statement is filed and declared effective but, following the Effectiveness Target
Date, during the Effectiveness Period, shall thereafter cease to be effective or
fail to be usable for its intended purpose without being succeeded within five
Business Days by a post-effective amendment to the Shelf Registration Statement, a
supplement to the Prospectus or a report filed with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act that cures such failure and,
in the case of a post-effective amendment, is itself immediately declared
effective; or

     (iii) (A) prior to or on the 45th or 60th day, as the case may be, of any
Suspension Period, such suspension has not been terminated or (B) Suspension
Periods exceed an aggregate of 90 days in any 360-day period,

(each such event referred to in foregoing clauses (i) through (iii), a
“Registration Default”), the Company hereby agrees to pay additional amounts
(“Additional Amounts”) with respect to any Notes constituting Transfer Restricted
Securities from and including the day following the Registration Default to, but
excluding, the day on which the Registration Default has been cured, accruing at a
rate: (x) with respect to the first 90-day period during which a Registration
Default shall have occurred and be continuing, equal to 0.25% per annum of the
principal amount of the Notes, and (y) with respect to the period commencing on the
91st day following the day the Registration Default shall have occurred and be
continuing, equal to 0.50% per annum of the principal amount of the Notes;
provided, that in no event shall Additional Amounts accrue at a rate per year
exceeding 0.50% of the principal amount of the Notes.

     (b) All accrued Additional Amounts shall be paid in arrears to such Holders as required
by, and in the manner described in, the Indenture. Following the cure of all Registration
Defaults relating to any particular Note, the accrual of Additional Amounts with respect to
such Note will cease. The Company agrees to deliver all notices, certificates and other
documents contemplated by the Indenture in connection with the payment of Additional
Amounts.

     All obligations of the Company set forth in this Section 3 that are outstanding with respect
to any Transfer Restricted Security at the time such security ceases to be a Transfer

6

 

Restricted Security shall survive until such time as all such obligations with respect to such
Transfer Restricted Security shall have been satisfied in full.

     The Additional Amounts set forth above shall be the exclusive monetary remedy available to the
Holders of Transfer Restricted Securities for such Registration Default.

     4. Registration Procedures.

     (a) In connection with the Shelf Registration Statement, the Company shall comply with
all the provisions of Section 4(b) hereof and shall use its reasonable best efforts to
effect such registration to permit the sale of the Transfer Restricted Securities being sold
in accordance with the intended method or methods of distribution thereof, and pursuant
thereto, shall prepare and file with the Commission such Shelf Registration Statement
relating to the registration on any appropriate form under the Securities Act; provided,
however, that no Holder shall be entitled to be named in the Shelf Registration Statement,
as of the date it is declared effective, or to the Prospectus forming part thereof, for
offers and sales of the Transfer Restricted Securities unless such Holder is a Notice
Holder, provided further, that it is understood and agreed that the Company may satisfy its
obligations hereunder by registering the Transfer Restricted Securities pursuant to a
Prospectus to a registration statement that has already been declared effective.

     (b) In connection with the Shelf Registration Statement and any Prospectus required by
this Agreement to permit the sale or resale of Transfer Restricted Securities, the Company
shall:

     (i) Subject to any notice by the Company in accordance with Section 4(b) of
the existence of any fact or event of the kind described in Section 4(b)(iii)(D),
use its reasonable best efforts to keep the Shelf Registration Statement
continuously effective during the Effectiveness Period; upon the occurrence of any
event or the existence of any fact that would cause the Shelf Registration
Statement or the Prospectus contained therein, in either case including any
document incorporated by reference therein, (A) to contain a material misstatement
or omission or (B) not be effective and usable for resale of Transfer Restricted
Securities during the Effectiveness Period, the Company shall file promptly an
appropriate amendment to the Shelf Registration Statement, a supplement to the
Prospectus or a report filed with the Commission pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act, in the case of clause (A), correcting any such
misstatement or omission, and, in the case of either clause (A) or (B), use its
reasonable best efforts to cause such amendment to be declared effective and the
Shelf Registration Statement and the related Prospectus to become usable for their
intended purposes as soon as practicable thereafter. Notwithstanding the
foregoing, the Company may suspend the Holders’ use of the Prospectus by written
notice to the Holders for a period not to exceed an aggregate of 45 days in any
90-day period and not to exceed an aggregate of 90 days in any 360-day period (each
such period, a “Suspension Period”) if:

7

 

     (A) in the reasonable judgment of the Company, the Shelf Registration
Statement or the related Prospectus, as applicable, contains a material
misstatement or omission as a result of an event that has occurred and is
continuing; and

     (B) the Company in good faith determines that the disclosure of the
material non-public information would be detrimental to the Company and its
subsidiaries taken as a whole;

provided, that in the event the disclosure relates to a previously undisclosed
proposed or pending material business transaction, the disclosure of which the
Company determines in good faith would be reasonably likely to impede the Company’s
ability to consummate such transaction, the Company may extend a Suspension Period
from 45 days to 60 days; provided, however, that Suspension Periods shall not in any
event exceed an aggregate of 90 days in any 360-day period. The Company shall not
be required to specify in the written notice to the Holders the nature of the event
contemplated by clauses (A) and (B) above giving rise to the Suspension Period.
Each Holder, by acceptance of the Notes, agrees to hold any communication by the
Company under this Section 4(b) in confidence.

     (ii) Prepare and file with the Commission such amendments and post-effective
amendments to the Shelf Registration Statement as may be necessary to keep the
Shelf Registration Statement effective during the Effectiveness Period; cause the
Prospectus to be supplemented by any required prospectus supplement, and as so
supplemented to be filed pursuant to Rule 424 under the Securities Act, and to
comply fully with the applicable provisions of Rules 424 and 430A under the
Securities Act in a timely manner; and comply with the provisions of the Securities
Act with respect to the disposition of all Transfer Restricted Securities covered
by the Shelf Registration Statement during the applicable period in accordance with
the intended method or methods of distribution by the sellers thereof set forth in
the Shelf Registration Statement or supplement to the Prospectus.

     (iii) Following the effectiveness of the Shelf Registration Statement, advise
the Notice Holders and the Underwriter(s), if any, promptly (but in any event
within two Business Days) and, if requested by such Persons, to confirm such advice
in writing:

     (A) when the Shelf Registration Statement or post-effective amendment
has been filed and when the same has become effective, or, if the Company
elects to register the Transfer Restricted Securities pursuant to a
Prospectus to a registration statement that is already effective, when such
Prospectus is filed; provided, however, that the Company shall have no
obligation to notify the Notice Holders of any amendments to the Shelf
Registration Statement or Prospectus resulting from the filing of Exchange
Act reports;

8

 

     (B) of any request by the Commission for amendments to the Shelf
Registration Statement or amendments or supplements to the Prospectus or
for additional information relating thereto, as applicable;

     (C) of the issuance by the Commission of any stop order suspending the
effectiveness of the Shelf Registration Statement under the Securities Act
or of the suspension by any state securities commission of the
qualification of the Transfer Restricted Securities for offering or sale in
any jurisdiction, or the initiation of any proceeding for any of the
preceding purposes; or

     (D) of the existence of any fact or the happening of any event, during
the Effectiveness Period, that makes any statement of a material fact made
in the Shelf Registration Statement, the Prospectus, any amendment or
supplement thereto, as applicable, or any document incorporated by
reference therein untrue, or that requires the making of any additions to
or changes in the Shelf Registration Statement in order to make the
statements therein not misleading, or that requires the making of any
additions to or changes in the Prospectus in order to make the statements
in the Prospectus in the light of the circumstances under which they were
made not misleading (including, in any such case, as a result of the
non-availability of financial statements); provided, however, that no
notice by the Company shall be required pursuant to this clause (D) in the
event that the Company either promptly files a Prospectus supplement to
update the Prospectus or a Form 8-K or other appropriate Exchange Act
report that is incorporated by reference into the Shelf Registration
Statement, which, in either case, contains the requisite information that
results in the Shelf Registration Statement or Prospectus no longer
containing any untrue statement of material fact or omitting to state a
necessary to make the statements therein not misleading.

     If at any time the Commission shall issue any stop order suspending the effectiveness of the
Shelf Registration Statement or any state securities commission or other regulatory authority shall
issue an order suspending the qualification or exemption from qualification of the Transfer
Restricted Securities under state securities or blue sky laws, the Company shall use its reasonable
best efforts to obtain the withdrawal or lifting of such order at the earliest possible time and
will provide to the Initial Purchasers and each Holder who is named in the Shelf Registration
Statement prompt notice of the withdrawal of any such order.

     (iv) Furnish to the Initial Purchasers and counsel for the Initial Purchasers,
if any, before filing with the Commission, a copy of the Shelf Registration
Statement, and copies of any Prospectus included therein or any amendments or
supplements to the Shelf Registration Statement, (other than documents incorporated
by reference after the initial filing of the Shelf Registration Statement and other
than amendments or supplements filed to name additional Holders or to change or add
information regarding a Holder or its plan of distribution of Transfer Restricted
Securities or similar information and other

9

 

than amendments or supplements filed other than to comply with this
Agreement), which documents will be subject to the review of such persons, counsel
and Underwriter(s), if any, for a period of at least two Business Days. The
Company agrees to consider in good faith reasonable comments made by the Initial
Purchasers and such counsel.

     (v) Make available at reasonable times for inspection by one or more
representatives designated by a Majority of Holders whose Transfer Restricted
Securities are included in the Shelf Registration Statement and any attorney or
accountant retained by such Notice Holders or any of the Underwriter(s), all
financial and other records, pertinent corporate documents and properties of the
Company as shall be reasonably necessary to enable them to conduct a reasonable
investigation within the meaning of Section 11 of the Securities Act and cause the
Company’s officers, directors, managers and employees to supply all information
reasonably requested by any representatives of such Notice Holders, Underwriter,
attorney or accountant in connection with the Shelf Registration Statement;
provided, however, that the Company shall have no obligation to deliver information
to any Notice Holder or representative thereof pursuant to this Section 4(b)(iv)
unless such Notice Holder or representative shall have executed and delivered a
confidentiality agreement in a form acceptable to the Company relating to such
information; provided further, that if the foregoing inspection and information
gathering would otherwise disrupt the Company’s conduct of its business, such
inspection and information gathering shall be coordinated on behalf of the
Underwriter(s), if any, and Notice Holders and the other parties entitled thereto
by one counsel designated by and on behalf of the Underwriters(s) and Notice
Holders and other parties.

     (vi) If requested by any Notice Holders or the Underwriter(s), if any,
promptly incorporate in the Shelf Registration Statement or Prospectus, as
applicable, pursuant to a supplement, Exchange Act report or post-effective
amendment if necessary, such information as such Notice Holders and Underwriter(s),
if any, may reasonably request to have included therein, including, without
limitation: (1) information relating to the “Plan of Distribution” of the Transfer
Restricted Securities, (2) information with respect to the principal amount of
Notes or number of shares of Common Stock being sold to such Underwriter(s), (3)
the purchase price being paid therefor and (4) any other terms of the offering of
the Transfer Restricted Securities to be sold in such offering; and make all
required filings of such Prospectus supplement, Exchange Act report or
post-effective amendment as soon as reasonably practicable after the Company is
notified of the matters to be incorporated in such Prospectus supplement, Exchange
Act report or post-effective amendment.

     (vii) Furnish to each Notice Holder and each of the Underwriter(s), if any,
upon its request, without charge, at least one copy of the Shelf Registration
Statement as first filed with the Commission, and of each amendment thereto (and
any documents incorporated by reference therein or exhibits thereto (or exhibits
incorporated in such exhibits by reference) as such Person may request);

10

 

provided, however, that the Company shall have no obligation to deliver to
Notice Holders a copy of any amendment consisting exclusively of an Exchange Act
report or other Exchange Act filing publicly available through the Commission’s
website.

     (viii) Deliver to each Notice Holder and each of the Underwriter(s), if any,
without charge, as many copies of the Prospectus (including each preliminary
prospectus) and any amendment or supplement thereto as such Persons reasonably may
request; provided, however, that the Company shall have no obligation to deliver to
Notice Holders a copy of any amendment consisting exclusively of an Exchange Act
report or other Exchange Act filing publicly available through the Commission’s
website. Subject to any notice by the Company in accordance with this Section 4(b)
of the existence of any fact or event of the kind described in Section
4(b)(iii)(D), the Company hereby consents to the use of the Prospectus and any
amendment or supplement thereto by each of the Notice Holders and each of the
Underwriter(s), if any, in connection with the offering and the sale of the
Transfer Restricted Securities covered by the Prospectus or any amendment or
supplement thereto.

     (ix) In the case of an Underwritten Offering conducted pursuant to Section 7,
the Company shall:

     (A) upon request, furnish to each Notice Holder and each Underwriter,
if any, in such substance and scope as they may reasonably request and as
are customarily made by issuers to underwriters in secondary underwritten
offerings for selling security holders, upon the date of closing of any
sale of Transfer Restricted Securities in an Underwritten Registration:

     (1) a certificate, dated the date of such closing, signed by the
Chief Executive Officer or Chief Financial Officer of the Company
confirming, as of the date thereof, matters of the type set forth in
Section 2 of the Purchase Agreement and such other matters as such
parties may reasonably request;

     (2) opinions, each dated the date of such closing, of counsel to
the Company covering such of the matters as are customarily covered
in legal opinions to underwriters in connection with underwritten
offerings of securities; and

     (3) customary comfort letters, dated the date of such closing,
from the Company’s independent accountants in the customary form and
covering matters of the type customarily covered in comfort letters
to underwriters in connection with underwritten offerings of
securities;

11

 

     (B) set forth in full in the underwriting agreement, if any,
indemnification provisions and procedures which provide rights no less
protective than those set forth in Section 6 hereof with respect to all
parties to be indemnified; and

     (C) deliver such other documents and certificates as may be reasonably
requested by such parties to evidence compliance with clause (A) above and
with any customary conditions contained in the underwriting agreement or
other agreement entered into by the Notice Holders pursuant to this clause
(ix).

     (x) Before any public offering of Transfer Restricted Securities, cooperate
with the Notice Holders, the Underwriter(s), if any, and their respective counsel
in connection with the registration and qualification of the Transfer Restricted
Securities under the securities or blue sky laws of such jurisdictions in the
United States as the Notice Holders or Underwriter(s), if any, may reasonably
request and do any and all other acts or things necessary or advisable to enable
the disposition in such jurisdictions of the Transfer Restricted Securities covered
by the Shelf Registration Statement; provided, that the Company will not be
required to qualify to do business in any jurisdiction where it is not then so
qualified or to take any action which would subject it to general service of
process or to taxation in any such jurisdiction where it is not then so subject.

     (xi) Cooperate with the Notice Holders and the Underwriter(s), if any, to
facilitate the timely preparation and delivery of certificates representing
Transfer Restricted Securities to be sold and not bearing any restrictive legends
(unless required by applicable securities laws); and enable such Transfer
Restricted Securities to be in such denominations and registered in such names as
the Notice Holders or the Underwriter(s), if any, may request at least two Business
Days before any sale of Transfer Restricted Securities made by such Underwriter(s);
provided that nothing herein shall require the Company to deliver certificated
Notes to any beneficial holder of Notes except as required by the Indenture.

     (xii) Use its reasonable best efforts to cause the Transfer Restricted
Securities covered by the Shelf Registration Statement to be registered with or
approved by such other U.S. governmental agencies or authorities as may be
necessary to enable the seller or sellers thereof or the Underwriter(s), if any, to
consummate the disposition of such Transfer Restricted Securities.

     (xiii) Provide CUSIP numbers for all Transfer Restricted Securities not later
than the effective date of the Shelf Registration Statement or making available of
an existing registration statement for resales of Transfer Restricted Securities,
as applicable, and provide the Trustee under the Indenture with certificates for
the Notes that are in a form eligible for deposit with The Depository Trust
Company.

12

 

     (xiv) Cooperate and assist in any filings required to be made with the NASD
and the NYSE and in the performance of any due diligence investigation by any
Underwriter that is required to be retained in accordance with the rules and
regulations of the NASD and the NYSE.

     (xv) Cause the Indenture to be qualified under the TIA not later than the
effective date of the Shelf Registration Statement required by this Agreement, and,
in connection therewith, cooperate with the Trustee and the holders of Notes to
effect such changes to the Indenture as may be required for such Indenture to be so
qualified in accordance with the terms of the TIA; and execute and use its
reasonable best efforts to cause the Trustee thereunder to execute all documents
that may be required to effect such changes and all other forms and documents
required to be filed with the Commission to enable such Indenture to be so
qualified in a timely manner.

     (xvi) Cause all shares of Common Stock covered by the Shelf Registration
Statement to be listed or quoted, as the case may be, on each securities exchange
or automated quotation system on which similar securities issued by the Company are
then listed or quoted.

     (c) Each Holder agrees by acquisition of a Transfer Restricted Security that, upon
receipt of any notice from the Company of the existence of any fact of the kind described in
Section 4(b)(iii)(C) or (D) hereof, such Holder will, and will use its reasonable best
efforts to cause any Underwriter(s) in an Underwritten Offering to, forthwith discontinue
disposition of Transfer Restricted Securities pursuant to the Shelf Registration Statement
until:

     (i) such Holder has received copies of the supplemented or amended Prospectus
contemplated by Section 4(b)(i) and 4(b)(viii) hereof; or

     (ii) such Holder is advised in writing by the Company that the use of the
Prospectus, or any amendment or supplement thereto, may be resumed, and has
received copies of any additional or supplemental filings that are incorporated by
reference in the Prospectus.

     If so directed by the Company, each Holder will deliver to the Company (at the Company’s
expense) all copies, other than permanent file copies then in such Holder’s possession, of the
Prospectus covering such Transfer Restricted Securities that was current at the time of receipt of
such notice of suspension.

     5. Registration Expenses. All expenses incident to the Company’s performance of or compliance
with this Agreement shall be borne by the Company regardless of whether a Shelf Registration
Statement becomes effective, including, without limitation:

     (a) all registration and filing fees and expenses (including filings required to be
made by any Holders with the NASD or the NYSE);

13

 

     (b) all fees and expenses of the Company incident to compliance with federal securities
and state blue sky or securities laws;

     (c) all expenses of printing (including printing of Prospectuses and certificates for
the Common Stock to be issued upon conversion of the Notes) and the Company’s expenses for
messenger and delivery services and telephone;

     (d) all fees and disbursements of counsel to the Company;

     (e) all application and filing fees in connection with listing (or authorizing for
quotation) the Common Stock on a national securities exchange or automated quotation system
pursuant to the requirements hereof; and

     (f) all fees and disbursements of independent certified public accountants of the
Company (including the expenses of any special audit and comfort letters required by or
incident to such performance).

     The Company shall bear its internal expenses (including, without limitation, all salaries and
expenses of its officers and employees performing legal, accounting or other duties), the expenses
of any annual audit and the fees and expenses of any Person, including special experts, retained by
the Company.

6. Indemnification and Contribution.

     (a) The Company shall indemnify and hold harmless each Holder, such Holder’s officers,
directors, partners and employees and each person, if any, who controls such Holder within
the meaning of the Securities Act (each, an “Indemnified Holder”), from and against any
loss, claim, damage or liability, joint or several, or any action in respect thereof
(including, but not limited to, any loss, claim, damage, liability or action relating to
resales of the Transfer Restricted Securities), to which such Indemnified Holder may become
subject, under the Act or otherwise, insofar as any such loss, claim, damage, liability or
action arises out of, or is based upon:

     (i) any untrue statement or alleged untrue statement of a material fact
contained in the Shelf Registration Statement, Prospectus or any amendment or
supplement thereto or any Issuer Free Writing Prospectus, as applicable; or

     (ii) the omission or alleged omission to state therein any material fact
necessary to make the statements therein (in the case of the Prospectus, or any
amendment or supplement thereto, in the light of the circumstances under which they
were made) not misleading;

provided, however, that the Company shall not be liable in any such case to the
extent that any such loss, claim, damage, liability or action arises out of, or is
based upon, any untrue statement or alleged untrue statement or omission or alleged
omission made in the Shelf Registration Statement, Prospectus or amendment or
supplement thereto, or any Issuer Free Writing Prospectus in reliance upon and in
conformity with written information furnished to the

14

 

Company by or on behalf of such Indemnified Holder specifically for inclusion
therein; provided, further, that as to any Prospectus or any amendment or
supplement thereto, this indemnity agreement shall not inure to the benefit of any
Indemnified Holder on account of any loss, claim, damage, liability or action
arising from the sale of Transfer Restricted Securities to any person by that
Indemnified Holder if that Indemnified Holder failed to send or give a copy of the
Prospectus or any amendment or supplement thereto, to that person, and the untrue
statement or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact in such Prospectus or any amendment or supplement
thereto was corrected in the Prospectus or any amendment or supplement thereto,
unless such failure resulted from non-compliance by the Company with Section
4(b)(viii). The foregoing indemnity agreement is in addition to any liability
which the Company may otherwise have to any Indemnified Holder.

     (b) Each Holder, severally and not jointly, shall indemnify and hold harmless the
Company, its officers and directors and each person, if any, who controls the Company within
the meaning of the Securities Act, from and against any loss, claim, damage or liability,
joint or several, or any action in respect thereof, to which the Company or any such
director, officer, or controlling person may become subject, insofar as any such loss,
claim, damage or liability or action arises out of, or is based upon:

     (i) any untrue statement or alleged untrue statement of any material fact
contained in the Shelf Registration Statement or Prospectus or any amendment or
supplement thereto; or

     (ii) the omission or the alleged omission to state therein (in the case of the
Prospectus, or any amendment or supplement thereto, in the light of the
circumstances under which they were made) any material fact necessary to make the
statements therein not misleading, but in each case only to the extent that such
untrue statement or alleged untrue statement or omission or alleged omission was
made in reliance upon and in conformity with written information furnished to the
Company by or on behalf of such Holder (or its related Indemnified Holder)
specifically for use therein, and shall reimburse the Company and any such officer
or controlling person promptly upon demand for any legal or other expenses
reasonably incurred by the Company or any such director, officer or controlling
person in connection with investigating or defending or preparing to defend against
any such loss, claim, damage, liability or action as such expenses are incurred.
The foregoing indemnity agreement is in addition to any liability which any Holder
may otherwise have to the Company and any such director, officer or controlling
person. In no event shall the liability of any Notice Holder hereunder be greater
in amount than the dollar amount of the proceeds received by such Holder upon the
sale of the Transfer Restricted Securities pursuant to the Shelf Registration
Statement giving rise to such indemnification obligation.

15

 

     (c) Promptly after receipt by an indemnified party under this Section 6 of notice of
any claim or the commencement of any action, the indemnified party shall, if a claim in
respect thereof is to be made against the indemnifying party under this Section 6, notify
the indemnifying party in writing of the claim or the commencement of that action; provided,
however, that the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 6 except to the extent it has been materially
prejudiced (including, without limitation, the forfeiture of substantive rights and
defenses) by such failure and, provided, further, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have to an
indemnified party otherwise than under this Section 6. If any such claim or action shall be
brought against an indemnified party, and it shall notify the indemnifying party thereof,
the indemnifying party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume the defense
thereof with counsel reasonably satisfactory to the indemnified party. After notice from
the indemnifying party to the indemnified party of its election to assume the defense of
such claim or action, the indemnifying party shall not be liable to the indemnified party
under this Section 6 for any legal or other expenses subsequently incurred by the
indemnified party in connection with the defense thereof other than reasonable costs of
investigation; provided, however, that a Majority of Holders shall have the right to employ
separate counsel to represent jointly a Majority of Holders and their respective officers,
directors, partners, employees and controlling persons who may be subject to liability
arising out of any claim in respect of which indemnity may be sought by a Majority of
Holders against the Company under this Section 6, if, (i) the employment of such counsel
shall have been specifically authorized in writing by the indemnifying party, (ii) the
indemnifying party shall have failed to assume the defense of such action or employ counsel
reasonably satisfactory to the indemnified party or (iii) the named parties to any such
action (including any impleaded parties) include both the indemnified party and the
indemnifying party, and the indemnified party shall have been advised by such counsel that
there may be one or more legal defenses available to it that are different from or
additional to those available to the indemnifying party (in which case the indemnifying
party shall not have the right to assume the defense of such action on behalf of the
indemnified party), and in any such event the fees and expenses of such separate counsel
shall be paid by the Company. No indemnifying party shall:

     (i) without the prior written consent of the indemnified parties (which
consent shall not be unreasonably withheld or delayed) settle or compromise or
consent to the entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified parties are
actual or potential parties to such claim or action) unless such settlement,
compromise or consent includes an unconditional release of each indemnified party
from all liability arising out of such claim, action, suit or proceeding and does
not contain any statement as to or admission of fault, culpability or failure to
act by or on behalf of any indemnified party; or

     (ii) be liable for any settlement of any such action effected without its
written consent (which consent shall not be unreasonably withheld or

16

 

delayed), but if settled with a written consent from the indemnifying party or
if there be a final judgment for the plaintiff in any such action, the indemnifying
party agrees to indemnify and hold harmless any indemnified party from and against
any loss or liability by reason of such settlement.

     (d) If the indemnification provided for in this Section 6 shall for any reason be
unavailable or insufficient to hold harmless an indemnified party under Section 6(a) or 6(b)
in respect of any loss, claim, damage or liability, or action in respect thereof, referred
to therein, each indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result of such loss,
claim, damage or liability, or action in respect thereof:

     (i) in such proportion as shall be appropriate to reflect the relative
benefits received by the Company from the offering and sale of the Transfer
Restricted Securities on the one hand and a Holder with respect to the sale by such
Holder of the Transfer Restricted Securities on the other; or

     (ii) if the allocation provided by clause (6)(d)(i) is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause 6(d)(i) but also the relative fault of the
Company on the one hand and the Holders on the other with respect to the statements
or omissions or alleged statements or alleged omissions that resulted in such loss,
claim, damage or liability (or action in respect thereof), as well as any other
relevant equitable considerations.

     The relative benefits received by the Company on the one hand and a Holder on the other with
respect to such offering and such sale shall be deemed to be in the same proportion as the total
net proceeds from the offering of the Notes purchased under the Purchase Agreement (before
deducting expenses) received by the Company on the one hand, bear to the total proceeds received by
such Holder with respect to its sale of Transfer Restricted Securities on the other. The relative
fault shall be determined by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material fact relates to
information supplied by the Company or the Holders, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such statement or omission.
The Company and each Holder agree that it would not be just and equitable if the amount of
contribution pursuant to this Section 6(d) were determined by pro rata allocation or by any other
method of allocation that does not take into account the equitable considerations referred to
herein. The amount paid or payable by an indemnified party as a result of the loss, claim, damage
or liability, or action in respect thereof, referred to above in this Section 6(d) shall be deemed
to include, for purposes of this Section 6(d), any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 6(d), no Holder shall be required to contribute any
amount in excess of the amount by which the total price at which the Transfer Restricted Securities
purchased by it were resold exceeds the amount of any damages which such Holder has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person

17

 

who was not guilty of such fraudulent misrepresentation. The Holders’ obligations to
contribute as provided in this Section 6(d) are several and not joint.

     7. Underwritten Offerings.

     (a) During the Effectiveness Period, any Holder of Transfer Restricted Securities who
desires to do so may sell Transfer Restricted Securities (in whole or in part) in an
Underwritten Offering only with the prior written consent of the Company. Upon the receipt
of a request by Holders of at least 50% in aggregate principal amount of the Transfer
Restricted Securities then outstanding for an Underwritten Offering covering at least 50% of
the aggregate principal amount of the Transfer Restricted Securities then outstanding, the
Company shall promptly provide all Holders of Transfer Restricted Securities written notice
of the request, which notice shall inform such Holders that they have the opportunity to
participate in the offering; provided, however, that the Company shall only be required to
provide such notice if it determines, in its sole discretion, that it will consent to such
Underwritten Offering. In any such Underwritten Offering, the investment banker or bankers
and manager or managers that will administer the offering will be selected by, and the
underwriting arrangements with respect thereto (including the size of the offering) will be
approved by, the Holders of a majority of the Transfer Restricted Securities to be included
in such offering; provided, however, that such investment bankers and managers and
underwriting arrangements must be reasonably satisfactory to the Company. Notwithstanding
anything to the contrary herein, in no circumstances will the Company be required to
undertake an Underwritten Offering of Transfer Restricted Securities.

     (b) No Holder may participate in any Underwritten Offering contemplated hereby unless
(a) such Holder agrees to sell such Holder’s Transfer Restricted Securities to be included
in the Underwritten Offering in accordance with any approved underwriting arrangements, (b)
such Holder completes and executes all reasonable questionnaires, powers of attorney,
indemnities, underwriting agreements, lock-up letters and other documents required under the
terms of such approved underwriting arrangements, and (c) such Holder returns a completed
and signed Questionnaire to the Company in accordance with Section 2(b) hereof within a
reasonable amount of time before such Underwritten Offering. The Holders participating in
any Underwritten Offering shall be responsible for any underwriting discounts and
commissions and expenses of their own counsel. The Company shall be entitled to select and
manage the printer for such offering and any other vendors whose expenses the Company is
obligated to pay. The Company shall pay all expenses customarily borne by issuers in an
Underwritten Offering, including but not limited to filing fees, the fees and disbursements
of its counsel and independent public accountants and any printing expenses incurred in
connection with such Underwritten Offering (which expenses shall not exceed $100,000 in the
aggregate). Notwithstanding the foregoing or the provisions of Section 4(b)(ix) hereof,
upon receipt of a request from the managing underwriter or a representative of holders of a
majority of the Transfer Restricted Securities to be included in an Underwritten Offering to
prepare and file an amendment or supplement to the Shelf Registration Statement and
Prospectus in connection with an Underwritten Offering, the Company may delay its
participation in the Underwritten Offering, including, without

18

 

limitation, the filing of any such amendment or supplement for up to 90 days if the
board of directors of the Company shall have determined in good faith that the Company has a
bona fide business reason for such delay.

     8. Miscellaneous.

     (a) Remedies. The Company acknowledges and agrees that any failure by the Company to
comply with its obligations under Section 2 hereof may result in material irreparable injury
to the Initial Purchasers or the Holders for which there is no adequate remedy at law, that
it will not be possible to measure damages for such injuries precisely and that, in the
event of any such failure, the Initial Purchasers or any Holder may obtain such relief as
may be required to specifically enforce the Company’s obligations under Section 2 hereof;
provided, that specific performance shall be the sole equitable remedy available to Holders
hereunder. The Company further agrees to waive the defense in any action for specific
performance that a remedy at law would be adequate.

     (b) Actions Affecting Transfer Restricted Securities. The Company shall not, directly
or indirectly, take any action with respect to the Transfer Restricted Securities as a class
that would adversely affect the ability of the Holders of Transfer Restricted Securities to
include such Transfer Restricted Securities in a registration undertaken pursuant to this
Agreement.

     (c) No Inconsistent Agreements. The Company will not, on or after the date of this
Agreement, enter into any agreement with respect to its securities that is inconsistent with
the rights granted to the Holders in this Agreement or otherwise conflicts with the
provisions hereof. The Company has not previously entered into any agreement (which has not
expired or been terminated) granting any registration rights with respect to its securities
to any Person which rights conflict with the provisions hereof.

     (d) Amendments and Waivers. This Agreement may not be amended, modified or
supplemented, and waivers or consents to or departures from the provisions hereof may not be
given, unless the Company has obtained the written consent of a Majority of Holders or such
greater percentage of the Holders as required by the Indenture.

     (e) Notices. All notices and other communications provided for or permitted hereunder
shall be made in writing by hand-delivery, first-class mail (registered or certified, return
receipt requested), telex, facsimile transmission, or air courier guaranteeing overnight
delivery:

     (i) if to a Holder, at the address set forth on the records of the registrar
under the Indenture or the transfer agent of the Common Stock, as the case may be;
and

19

 

	 	(ii)	 	if to the Company:
	 
	 	 	 	VeriFone Holdings, Inc.

2099 Gateway Place, Suite 600

San Jose, California 95110

Attention: Barry Zwarenstein

Fax: (408) 232-7889

Telephone: (408) 232-7800
	 
	 	 	 	With a copy to:
	 
	 	 	 	Sullivan & Cromwell LLP

1870 Embarcadero Road

Palo Alto, California 94303

Attention: Scott D. Miller

Fax: (650) 461-5700

Telephone: (650) 461-5600

     All such notices and communications shall be deemed to have been duly given; at the time
delivered by hand, if personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when receipt acknowledged, if
transmitted by facsimile; and on the next Business Day, if timely delivered to an air courier
guaranteeing overnight delivery.

     (f) Successors and Assigns. This Agreement shall inure to the benefit of and be
binding upon and enforceable by the successors and assigns of each of the parties, including
without limitation and without the need for an express assignment, subsequent Holders of
Transfer Restricted Securities; provided, however, that (i) this Agreement shall not inure
to the benefit of or be binding upon a successor or assign of a Holder unless and to the
extent such successor or assign acquired Transfer Restricted Securities from such Holder and
(ii) nothing contained herein shall be deemed to permit any assignment, transfer or other
disposition of Transfer Restricted Securities in violation of the terms of the Purchase
Agreement or the Indenture. If any transferee of any Holder shall acquire Transfer
Restricted Securities, in any manner, whether by operation of law or otherwise, such
Transfer Restricted Securities shall be held subject to all of the terms of this Agreement,
and by taking and holding such Transfer Restricted Securities such person shall be
conclusively deemed to have agreed to be bound by and to perform all of the terms and
provisions of this Agreement.

     (g) Counterparts. This Agreement may be executed in any number of counterparts and by
the parties hereto in separate counterparts, each of which when so executed shall be deemed
to be an original and all of which taken together shall constitute one and the same
agreement.

     (h) Securities Held by the Company or Its Affiliates. Whenever the consent or approval
of Holders of a specified percentage of Transfer Restricted Securities is required
hereunder, Transfer Restricted Securities held by the Company or its Affiliates shall not

20

 

be counted in determining whether such consent or approval was given by the Holders of
such required percentage.

     (i) Headings. The headings in this Agreement are for convenience of reference only and
shall not limit or otherwise affect the meaning hereof.

     (j) Governing Law. This Agreement shall be governed by, and construed in accordance
with, the law of the State of New York.

     (k) Severability. If any one or more of the provisions contained herein, or the
application thereof in any circumstance, is held invalid, illegal or unenforceable, the
validity, legality and enforceability of any such provision in every other respect and of
the remaining provisions contained herein shall not be affected or impaired thereby.

     (l) Entire Agreement. This Agreement is intended by the parties as a final expression
of their agreement and intended to be a complete and exclusive statement of the agreement
and understanding of the parties hereto in respect of the subject matter contained herein.
There are no restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein with respect to the registration rights granted by the Company with
respect to the Transfer Restricted Securities. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject matter.

21

 

     In Witness Whereof, the parties have executed this Agreement as of the date first written
above.

	 	 	 	 	 
	 	VERIFONE HOLDINGS, INC.

 	 
	 	By:  	/s/ Barry Zwarenstein	 
	 	 	Name:  	Barry Zwarenstein 	 
	 	 	Title:  	Executive Vice President
and Chief Financial Officer 	 
	 

	 	 	 	 	 
	 	LEHMAN BROTHERS INC.

 	 
	 	By:  	/s/
Michael Sherman	 
	 	 	Name:  	Michael Sherman	 
	 	 	Title:  	 	 
	 

	 	 	 	 	 
	 	J.P. MORGAN SECURITIES INC.

 	 
	 	By:  	/s/
Jeff
Zajkowski	 
	 	 	Name:  	Jeff
Zajkowski	 
	 	 	Title:  	Managing Director

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