Document:

Exhibit 4.1

 

 

INDENTURE

 

BETWEEN

 

VERTEX
PHARMACEUTICALS INCORPORATED,

 

AS ISSUER

 

AND

 

U.S. BANK NATIONAL
ASSOCIATION,

 

AS TRUSTEE

 

4.75% CONVERTIBLE
SENIOR SUBORDINATED NOTES DUE 2013

 

DATED AS OF
FEBRUARY 19, 2008

 

 

TABLE OF CONTENTS

 

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Article 1

  	
  Definitions and Incorporation by Reference

  	
  1

  
	
   

  	
   

  	
   

  
	
  Section 1.01

  	
  Definitions

  	
  1

  
	
  Section 1.02

  	
  Other Definitions

  	
  10

  
	
   

  	
   

  	
   

  
	
  Article 2

  	
  The Securities

  	
  11

  
	
   

  	
   

  	
   

  
	
  Section 2.01

  	
  Designation, Form and Dating

  	
  11

  
	
  Section 2.02

  	
  Final Maturity Date; Interest

  	
  11

  
	
  Section 2.03

  	
  Execution and Authentication

  	
  12

  
	
  Section 2.04

  	
  Registrar, Paying Agent, Conversion Agent and
  Trustee

  	
  12

  
	
  Section 2.05

  	
  Paying Agent To Hold Money in Trust

  	
  14

  
	
  Section 2.06

  	
  Conversion Agent to Hold Shares in Trust

  	
  14

  
	
  Section 2.07

  	
  Global Securities

  	
  15

  
	
  Section 2.08

  	
  Holder Lists

  	
  16

  
	
  Section 2.09

  	
  Transfer and Exchange

  	
  17

  
	
  Section 2.10

  	
  Mutilated, Destroyed, Lost and Stolen Securities

  	
  17

  
	
  Section 2.11

  	
  Outstanding Securities

  	
  18

  
	
  Section 2.12

  	
  Treasury Securities

  	
  18

  
	
  Section 2.13

  	
  Temporary Securities

  	
  18

  
	
  Section 2.14

  	
  Cancellation

  	
  19

  
	
  Section 2.15

  	
  Defaulted Interest

  	
  19

  
	
  Section 2.16

  	
  CUSIP Numbers

  	
  19

  
	
   

  	
   

  	
   

  
	
  Article 3

  	
  Redemption and Repurchase of Securities

  	
  20

  
	
   

  	
   

  	
   

  
	
  Section 3.01

  	
  Company’s right to Redeem

  	
  20

  
	
  Section 3.02

  	
  Notices to Trustee

  	
  20

  
	
  Section 3.03

  	
  Selection of Securities to be Redeemed

  	
  20

  
	
  Section 3.04

  	
  Notice of Redemption

  	
  21

  
	
  Section 3.05

  	
  Effect of Notice of Redemption

  	
  22

  
	
  Section 3.06

  	
  Deposit of Redemption Price

  	
  22

  
	
  Section 3.07

  	
  Securities Redeemed in Part

  	
  23

  
	
  Section 3.08

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

  	
  23

  
	
  Section 3.09

  	
  Effect of Fundamental Change Repurchase Notice

  	
  25

  
	
  Section 3.10

  	
  Deposit of Fundamental Change Repurchase Price

  	
  25

  
	
  Section 3.11

  	
  Repayment to the Company

  	
  26

  
	
  Section 3.12

  	
  [Reserved]

  	
  26

  
	
  Section 3.13

  	
  Securities Purchased in Part

  	
  26

  
	
  Section 3.14

  	
  Compliance with Securities Laws upon Purchase of
  Securities

  	
  26

  
	
  Section 3.15

  	
  Purchase of Securities in Open Market

  	
  27

  
	
   

  	
   

  	
   

  
	
  Article 4

  	
  Conversion

  	
  27

  
	
   

  	
   

  	
   

  
	
  Section 4.01

  	
  Conversion Privilege and Conversion Rate

  	
  27

  
	
  Section 4.02

  	
  Conversion Procedure

  	
  29

  
				

 

i

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 4.03

  	
  Fractional Shares

  	
  31

  
	
  Section 4.04

  	
  Taxes on Conversion

  	
  31

  
	
  Section 4.05

  	
  [Reserved]

  	
  31

  
	
  Section 4.06

  	
  Company to Provide Common Stock

  	
  31

  
	
  Section 4.07

  	
  Adjustment of Conversion Rate

  	
  32

  
	
  Section 4.08

  	
  No Adjustment

  	
  40

  
	
  Section 4.09

  	
  Notice of Adjustment

  	
  40

  
	
  Section 4.10

  	
  Notice of Certain Transactions

  	
  40

  
	
  Section 4.11

  	
  Effect of Reclassification, Consolidation, Merger or
  Sale on Conversion Privilege

  	
  41

  
	
  Section 4.12

  	
  Trustee’s Disclaimer

  	
  42

  
	
  Section 4.13

  	
  Voluntary Increase

  	
  42

  
	
   

  	
   

  	
   

  
	
  Article 5

  	
  Subordination

  	
  43

  
	
   

  	
   

  	
   

  
	
  Section 5.01

  	
  Securities Subordinated to Senior Debt

  	
  43

  
	
  Section 5.02

  	
  Subrogation

  	
  44

  
	
  Section 5.03

  	
  Obligation of the Company is Absolute and Unconditional

  	
  44

  
	
  Section 5.04

  	
  Maturity of or Default on Senior Debt

  	
  45

  
	
  Section 5.05

  	
  Payments on Securities Permitted

  	
  45

  
	
  Section 5.06

  	
  Effectuation of Subordination by Trustee

  	
  45

  
	
  Section 5.07

  	
  Knowledge of Trustee

  	
  45

  
	
  Section 5.08

  	
  Trustee’s Relation to Senior Debt

  	
  46

  
	
  Section 5.09

  	
  Rights of Holders of Senior Debt Not Impaired

  	
  46

  
	
  Section 5.10

  	
  Modification of Terms of Senior Debt

  	
  46

  
	
  Section 5.11

  	
  Certain Conversions Not Deemed Payment

  	
  47

  
	
  Section 5.12

  	
  No Layering of Debt

  	
  47

  
	
   

  	
   

  	
   

  
	
  Article 6

  	
  Covenants

  	
  47

  
	
   

  	
   

  	
   

  
	
  Section 6.01

  	
  Payment of Securities

  	
  47

  
	
  Section 6.02

  	
  Corporate Existence

  	
  48

  
	
  Section 6.03

  	
  Maintenance of Properties

  	
  48

  
	
  Section 6.04

  	
  Payment of Taxes and Other Claims

  	
  49

  
	
  Section 6.05

  	
  Reports

  	
  49

  
	
  Section 6.06

  	
  Compliance Certificate

  	
  49

  
	
   

  	
   

  	
   

  
	
  Article 7

  	
  Consolidation; Merger; Conveyance; Transfer or Lease

  	
  50

  
	
   

  	
   

  	
   

  
	
  Section 7.01

  	
  Company May Consolidate, Etc., Only on Certain Terms

  	
  50

  
	
  Section 7.02

  	
  Successor Substituted

  	
  51

  
	
   

  	
   

  	
   

  
	
  Article 8

  	
  Default and Remedies

  	
  51

  
	
   

  	
   

  	
   

  
	
  Section 8.01

  	
  Events of Default

  	
  51

  
	
  Section 8.02

  	
  Acceleration of Maturity; Rescission and Annulment

  	
  53

  
	
  Section 8.03

  	
  Other Remedies

  	
  54

  
	
  Section 8.04

  	
  Waiver of Past Defaults

  	
  54

  
				

 

ii

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 8.05

  	
  Control by Majority

  	
  54

  
	
  Section 8.06

  	
  Limitation on Suit

  	
  55

  
	
  Section 8.07

  	
  Unconditional Rights of Holders to Receive Payment
  and to Convert

  	
  55

  
	
  Section 8.08

  	
  Collection of Indebtedness and Suits for Enforcement
  by the Trustee

  	
  56

  
	
  Section 8.09

  	
  Trustee May File Proofs of Claim

  	
  56

  
	
  Section 8.10

  	
  Restoration of Rights and Remedies

  	
  57

  
	
  Section 8.11

  	
  Rights and Remedies Cumulative

  	
  57

  
	
  Section 8.12

  	
  Delay or Omission Not Waiver

  	
  57

  
	
  Section 8.13

  	
  Application of Money Collected

  	
  57

  
	
  Section 8.14

  	
  Undertaking for Costs

  	
  58

  
	
  Section 8.15

  	
  Waiver of Stay or Extension Laws

  	
  58

  
	
   

  	
   

  	
   

  
	
  Article 9

  	
  The Trustee

  	
  59

  
	
   

  	
   

  	
   

  
	
  Section 9.01

  	
  Certain Duties and Responsibilities

  	
  59

  
	
  Section 9.02

  	
  Certain rights of Trustees

  	
  60

  
	
  Section 9.03

  	
  Individual Rights of Trustee

  	
  61

  
	
  Section 9.04

  	
  Money Held in Trust

  	
  61

  
	
  Section 9.05

  	
  Trustee’s Disclaimer

  	
  61

  
	
  Section 9.06

  	
  Notice of Default

  	
  61

  
	
  Section 9.07

  	
  Reports by Trustee to Holders

  	
  62

  
	
  Section 9.08

  	
  Compensation and Indemnification

  	
  62

  
	
  Section 9.09

  	
  Replacement of Trustee

  	
  63

  
	
  Section 9.10

  	
  Successor Trustee by Merger, Etc.

  	
  64

  
	
  Section 9.11

  	
  Corporate Trustee Required: Eligibility

  	
  64

  
	
  Section 9.12

  	
  Collection of Claims Against the Company

  	
  64

  
	
   

  	
   

  	
   

  
	
  Article 10

  	
  Amendments; Supplements and Waivers

  	
  64

  
	
   

  	
   

  	
   

  
	
  Section 10.01

  	
  Without Consent of Holders

  	
  64

  
	
  Section 10.02

  	
  With Consent of Holders

  	
  65

  
	
  Section 10.03

  	
  Compliance With Trust Indenture Act

  	
  66

  
	
  Section 10.04

  	
  Revocation of Consents and Effect of Consents or
  Votes

  	
  67

  
	
  Section 10.05

  	
  Notation on or Exchange of Securities

  	
  67

  
	
  Section 10.06

  	
  Trustee Protected

  	
  67

  
	
   

  	
   

  	
   

  
	
  Article 11

  	
  Satisfaction and Discharge

  	
  67

  
	
   

  	
   

  	
   

  
	
  Section 11.01

  	
  Satisfaction and Discharge of Indenture

  	
  68

  
	
  Section 11.02

  	
  Deposited Monies To Be Held in Trust

  	
  69

  
	
  Section 11.03

  	
  Return of Unclaimed Monies

  	
  69

  
	
   

  	
   

  	
   

  
	
  Article 12

  	
  Meeting of Holders of Securities

  	
  69

  
	
   

  	
   

  	
   

  
	
  Section 12.01

  	
  Purposes for Which Meetings May Be Called

  	
  69

  
	
  Section 12.02

  	
  Call Notice and Place of Meetings

  	
  69

  
				

 

iii

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 12.03

  	
  Persons Entitled to Vote at Meetings

  	
  70

  
	
  Section 12.04

  	
  Quorum; Action

  	
  70

  
	
  Section 12.05

  	
  Determination of Voting Rights; Conduct and Adjournment
  of Meetings

  	
  70

  
	
  Section 12.06

  	
  Counting Votes and Recording Action of Meetings

  	
  71

  
	
   

  	
   

  	
   

  
	
  Article 13

  	
  Miscellaneous

  	
  71

  
	
   

  	
   

  	
   

  
	
  Section 13.01

  	
  Trust Indenture Act Controls

  	
  72

  
	
  Section 13.02

  	
  Notices

  	
  72

  
	
  Section 13.03

  	
  Communication by Holders With Other Holders

  	
  72

  
	
  Section 13.04

  	
  Acts of Holders of Securities

  	
  72

  
	
  Section 13.05

  	
  Certificate and Opinion as to Conditions Precedent

  	
  73

  
	
  Section 13.06

  	
  Statements Required in Certificate or Opinion

  	
  74

  
	
  Section 13.07

  	
  Effect of Headings and Table of Contents

  	
  74

  
	
  Section 13.08

  	
  Successors and Assigns

  	
  74

  
	
  Section 13.09

  	
  Separability Clause

  	
  75

  
	
  Section 13.10

  	
  Benefits of Indenture

  	
  75

  
	
  Section 13.11

  	
  Governing Law

  	
  75

  
	
  Section 13.12

  	
  Counterparts

  	
  75

  
	
  Section 13.13

  	
  Legal Holidays

  	
  75

  
	
  Section 13.14

  	
  Recourse Against Others

  	
  75

  
	
  Section 13.15

  	
  Calculation in Respect of Securities

  	
  76

  
	
  Section 13.16

  	
  No Security Interest Created

  	
  76

  
				

 

iv

 

CROSS-REFERENCE TABLE*

 

	
  Trust Indenture Act Section

  	
   

  	
  Indenture Section

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  310(a)(1)

  	
   

  	
  9.11

  	
   

  
	
  (a)(2)

  	
   

  	
  9.11

  	
   

  
	
  (a)(3)

  	
   

  	
  n/a

  	
   

  
	
  (a)(4)

  	
   

  	
  n/a

  	
   

  
	
  (a)(5)

  	
   

  	
  9.11

  	
   

  
	
  (b)

  	
   

  	
  9.03; 9.11

  	
   

  
	
  (c)

  	
   

  	
  n/a

  	
   

  
	
  311(a)

  	
   

  	
  9.12

  	
   

  
	
  (b)

  	
   

  	
  9.12

  	
   

  
	
  (c)

  	
   

  	
  n/a

  	
   

  
	
  312(a)

  	
   

  	
  2.08

  	
   

  
	
  (b)

  	
   

  	
  13.03

  	
   

  
	
  (c)

  	
   

  	
  13.03

  	
   

  
	
  313(a)

  	
   

  	
  5.7

  	
   

  
	
  (b)(1)

  	
   

  	
  n/a

  	
   

  
	
  (b)(2)

  	
   

  	
  9.07

  	
   

  
	
  (c)

  	
   

  	
  9.07; 13.02

  	
   

  
	
  (d)

  	
   

  	
  9.07

  	
   

  
	
  314(a)(1), (2),
  (3).

  	
   

  	
  6.06; 13.06

  	
   

  
	
  (a)(4)

  	
   

  	
  6.06; 6.07; 13.06

  	
   

  
	
  (b)

  	
   

  	
  n/a

  	
   

  
	
  (c)(1)

  	
   

  	
  13.05

  	
   

  
	
  (c)(2)

  	
   

  	
  13.05

  	
   

  
	
  (c)(3)

  	
   

  	
  n/a

  	
   

  
	
  (d)

  	
   

  	
  n/a

  	
   

  
	
  (e)

  	
   

  	
  13.06

  	
   

  
	
  (f)

  	
   

  	
  n/a

  	
   

  
	
  315(a)

  	
   

  	
  9.01(a

  	
  )

  
	
  (b)

  	
   

  	
  9.06; 13.02

  	
   

  
	
  (c)

  	
   

  	
  9.01(b

  	
  )

  
	
  (d)

  	
   

  	
  9.01(c

  	
  )

  
	
  (e)

  	
   

  	
  8.14

  	
   

  
	
  316(a)(last
  sentence)

  	
   

  	
  2.12

  	
   

  
	
  (a)(1)(A)

  	
   

  	
  8.05

  	
   

  
	
  (a)(1)(B)

  	
   

  	
  8.04

  	
   

  
	
  (a)(2)

  	
   

  	
  n/a

  	
   

  
	
  (b)

  	
   

  	
  8.07

  	
   

  
	
  (c)

  	
   

  	
  10.04

  	
   

  
	
  317(a)(1).

  	
   

  	
  8.08

  	
   

  
	
  (a)(2)

  	
   

  	
  8.09

  	
   

  

 

i

 

	
  Trust Indenture Act Section

  	
   

  	
  Indenture Section

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  2.04

  	
   

  
	
  318(a)

  	
   

  	
  13.01

  	
   

  
	
  (b)

  	
   

  	
  n/a

  	
   

  
	
  (c)

  	
   

  	
  13.01

  	
   

  

 

“n/a” means not
applicable.

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

 

ii

 

INDENTURE, dated as of February 19, 2008, between VERTEX
PHARMACEUTICALS INCORPORATED, a corporation duly organized and existing under
the laws of the Commonwealth of Massachusetts, having its principal office at
130 Waverly Street, Cambridge, Massachusetts 02139 (the “Company”), and U.S.
BANK NATIONAL ASSOCIATION, as trustee (the “Trustee”), having its principal
corporate trust office at One Federal Street, Boston, Massachusetts 02110.

 

RECITALS

 

The Company has duly authorized the creation of an issue of its 4.75%
Convertible Senior Subordinated Notes due February 15, 2013 (herein called
the “Securities”) of substantially the tenor and amount hereinafter set forth,
and to provide therefor the Company has duly authorized the execution and
delivery of this Indenture.

 

All things necessary to make the Securities, when the Securities are
executed by the Company and authenticated and delivered hereunder and duly
issued by the Company, the valid obligations of the Company, and to make this
Indenture a valid agreement of the Company, in accordance with their and its
terms, have been done.

 

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

 

For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed, for
the equal and proportionate benefit of all Holders of the Securities, as
follows:

 

Article 1

Definitions and Incorporation by Reference

 

Section 1.01                   Definitions.

 

For all purposes of this Indenture and the Securities, the following
terms are defined as follows:

 

“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” (including, with
correlative meanings, the terms “controlled by” and “under common control with”),
as used with respect to any person, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such person, whether through the ownership of voting securities or
by agreement or otherwise.

 

“Agent” means any
Registrar, Paying Agent, co-agent, co-registrar or Service Agent.

 

 

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

 

“Board of Directors”
means the board of directors of the Company.

 

“Board Resolution”
means a copy of a resolution certified by the Secretary or an Assistant
Secretary of the Company to have been adopted by the Board of Directors or
pursuant to authorization by the Board of Directors and to be in full force and
effect on the date of the certificate and delivered to the Trustee.

 

“Business Day”
means, unless otherwise provided by Board Resolution, Officers’ Certificate or
supplemental indenture hereto, any day except a Saturday, Sunday or a legal
holiday in The City of New York or the City of Boston, Massachusetts on which
banking institutions are authorized or required by law, regulation or executive
order to close.

 

“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, but excluding any debt securities
convertible into such equity.

 

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

 

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

 

“Change in Control”
means the occurrence of any of the following events from and after the Issue
Date:

 

(i) any “person” or “group” (as such terms are used in Section 13(d)(3) of
the Exchange Act or any successor provision to the foregoing), including any
group acting for the purpose of acquiring, holding or disposing of securities
within the meaning of Rule 13d–5(b)(1) under the Exchange Act, other
than the Company, any of its Subsidiaries or any of its employee benefit plans,
is or becomes the “beneficial owner” (as defined in Rule 13d–3 under the
Exchange Act), directly or indirectly, through a purchase, merger or other
acquisition transaction or series of transactions, of 50% or more of the total
voting power of all classes of the Company’s Voting Stock;

 

(ii) the Company consolidates with, or merges with or into,
another person (as such term is used in Sections 13(d)(3) of the Exchange
Act) or any person consolidates or merges with or into the Company, or the
Company conveys, transfers, leases or otherwise disposes of all or
substantially all of its assets to any person, other than (x) any
transaction that (A) does not result in any reclassification, conversion,
exchange or cancellation of outstanding shares of the Company’s Capital Stock,
and (B) pursuant to which holders of the Company’s Capital Stock
immediately prior to the transaction have the entitlement to exercise, directly
or indirectly, 50% or more of the total voting power of all shares of the
Voting Stock of the continuing or surviving entity of such transaction; or (y) any
merger solely for the purpose of changing the Company’s 

 

2

 

jurisdiction of formation and resulting in a reclassification,
conversion or exchange of outstanding shares of Common Stock solely into shares
of common stock of the surviving entity; notwithstanding anything to the
contrary set forth herein, a Change in Control will be deemed not to have
occurred if, in the case of a merger or consolidation, at least 90% of the
consideration (excluding cash payments for fractional shares and cash payments
made in respect of dissenters’ appraisal rights) in a transaction or
transactions otherwise constituting a Change in Control consists of shares of
common stock traded on a U.S. national securities exchange, or which will be so
traded when issued or exchanged in connection with the transaction or
transactions, and as a result of the transaction or transactions the Securities
become convertible solely into such common stock.

 

(iii) during any consecutive two-year period, individuals who at
the beginning of that two-year period constituted the Board of Directors
(together with any new directors whose election to such Board of Directors, or
whose nomination for election by stockholders of the Company, was approved by a
vote of a majority of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason (other than death) to
constitute a majority of the Board of Directors then in office; or

 

(iv) the Company’s stockholders approve a plan of liquidation or
dissolution.

 

“Closing Price”
means, on any Trading Day, the reported last sale price per share of the
Company’s Common Stock (or if no last sale price is reported, the average of
the bid and ask prices per share or, if more than one in either case, the
average of the average bid and the average ask prices per share) on such date
reported by the Nasdaq Global Market or, if the Company’s Common Stock (or the
applicable security) is not quoted on the Nasdaq Global Market, as reported by
the principal national securities exchange on which the Company’s Common Stock
(or such other security) is listed, or if no such prices are available, the Closing
Price per share shall be the fair value of a share of Common Stock (or such
other security) as reasonably determined by the Board of Directors (which
determination shall be conclusive and shall be evidenced by an Officers’
Certificate delivered to the Trustee).

 

“Common Stock”
means the common stock of the Company, par value $0.01 per share, as it exists
on the date of this Indenture and any shares of any class or classes of Capital
Stock of the Company resulting from any reclassification or reclassifications
thereof, or, in the event of a merger, consolidation or other similar
transaction involving the Company that is otherwise permitted hereunder in
which the Company is not the surviving corporation the common stock, common
equity interests, ordinary shares or depositary shares or other certificates
representing common equity interests of such surviving corporation or its
direct or indirect parent corporation, and which have no preference in respect
of dividends or of amounts payable in the event of any voluntary or involuntary
liquidation, dissolution or winding-up of the Company and which are not subject
to redemption by the Company; provided,
however, that if at any time there shall be more than one such
resulting class, the shares of each such class then so issuable on conversion
of Securities shall be substantially in the proportion which the total number
of shares of such class resulting from all such reclassifications bears to the
total number of shares of all such classes resulting from all such
reclassifications.

 

3

 

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

 

“Company Order”
means a written order signed in the name of the Company by two Officers, one of
whom must be the Company’s principal executive officer, principal financial
officer or principal accounting officer.

 

 “Conversion Agent” means any Person authorized by the
Company to convert Securities in accordance with Article 4 hereof.

 

“Conversion Price”
per share of Common Stock as of any day means the result obtained by dividing (i) $1,000
by (ii) the then applicable Conversion Rate.

 

“Conversion Rate”
means the rate at which shares of Common Stock shall be delivered upon
conversion, which rate shall be initially 43.2171 shares of Common Stock for
each $1,000 principal amount of Securities, as adjusted from time to time
pursuant to the provisions of this Indenture.

 

“Corporate Trust Office”
means the office of the Trustee at the address specified in Section 13.02
hereof or such other address as to which the Trustee may give notice to the
Company.

 

“Default” means,
when used with respect to the Securities, any event that is or, after notice or
passage of time, or both, would be, an Event of Default.

 

“Defaulted Interest”
has the meaning specified in Section 2.15 hereof.

 

“Depositary” means
The Depository Trust Company, its nominees and their respective assigns.

 

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

 

“Final Maturity Date”
means February 15, 2013.

 

“Final Prospectus”
means the prospectus of the Company, dated as of February 14, 2008, with
respect to the Securities, including the base prospectus attached thereto.

 

“Fundamental Change”
means the occurrence of either a Change in Control or a Termination of Trading.

 

“Fundamental Change Effective Date”
means the date on which any Fundamental Change becomes effective.

 

“Fundamental Change Repurchase
Price” of any Security means 100% of the principal amount of the
Security to be repurchased plus unpaid interest, including Special Interest, if
any, accrued and unpaid to, but excluding, the Fundamental Change Repurchase
Date.

 

4

 

“GAAP” means
generally accepted accounting principles in the United States of America as in
effect from time to time, including those set forth in (1) the opinions
and pronouncements of the Accounting Principles Board of the American Institute
of Certified Public Accountants, (2) the statements and pronouncements of
the Financial Accounting Standards Board, and (3) such other statements by
such other entity as approved by a significant segment of the accounting
profession.

 

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

 

“Holder” or “Holder of a Security” means the person
in whose name a Security is registered on the Registrar’s books.

 

“Indebtedness,” when
used with respect to any Person, and without duplication means:

 

(i) all indebtedness, obligations and other liabilities
(contingent or otherwise) of such Person for borrowed money (including
obligations of such person in respect of overdrafts and any loans or advances
from banks, whether or not evidenced by notes or similar instruments) or
evidenced by bonds, notes or other instruments for the payment of money, or
incurred in connection with the acquisition of any property, services or assets
(whether or not the recourse of the lender is to the whole of the assets of
such Person or to only a portion thereof), other than any account payable or
other accrued current liability or obligation to trade creditors incurred in
the ordinary course of business in connection with the obtaining of materials
or services;

 

(ii) all reimbursement obligations and other liabilities
(contingent or otherwise) of such Person with respect to letters of credit,
bank guarantees, bankers’ acceptances, surety bonds, performance bonds or other
guaranty of contractual performance;

 

(iii) all obligations and liabilities (contingent or otherwise) in
respect of (a) leases of such Person required, in conformity with GAAP, to
be accounted for as capitalized lease obligations on the balance sheet of such
Person and (b) any lease or related documents, including a purchase
agreement, in connection with the lease of real property which provides that
such Person is contractually obligated to purchase or cause a third party to
purchase the leased property and thereby guarantee a minimum residual value of
the leased property to the landlord and the obligations of such Person under
such lease or related document to purchase or to cause a third party to
purchase the leased property;

 

(iv) all obligations of such Person (contingent or otherwise) with
respect to an interest rate or other swap, cap or collar agreement or other
similar instrument or agreement or foreign currency hedge, exchange, purchase
or similar instrument or agreement;

 

(v) all direct or indirect guaranties or similar agreements by
such Person in respect of, and obligations or liabilities (contingent or
otherwise) of such Person to purchase or otherwise acquire or otherwise assure
a creditor against loss in respect of, indebtedness, obligations or liabilities
of another Person of the kind described in clauses (i) through (iv);

 

5

 

(vi) any indebtedness or other obligations described in clauses (i) through
(iv) secured by any mortgage, pledge, lien or other encumbrance existing
on property which is owned or held by such Person, regardless of whether the
indebtedness or other obligation secured thereby shall have been assumed by
such Person; and

 

(vii) any and all deferrals, renewals, extensions, refinancings,
replacements, restatements and refundings of, or amendments, modifications or
supplements to, any indebtedness, obligation or liability of the kind described
in clauses (i) through (vi).

 

“Interest Payment Date”
means February 15 and August 15, of each year, commencing August 15,
2008.

 

“Issue Date” of any
Security means the date on which the Security was originally issued or deemed
issued as set forth on the face of the Security.

 

“Maturity” means
the date on which the principal of such Security becomes due and payable as
therein or herein provided, whether at the Final Maturity Date or by
acceleration, conversion, exercise of a repurchase right or otherwise.

 

“Officer” means the
Chairman of the Board, any President, any Vice-President, the Treasurer, the
Secretary, any Assistant Treasurer or any Assistant Secretary of the Company.

 

“Officers’ Certificate”
means a certificate signed by two Officers, one of whom must be the Company’s
principal executive officer, principal financial officer or principal
accounting officer.

 

“Opinion of Counsel”
means a written opinion of legal counsel who is reasonably acceptable to the
Trustee. The counsel may be an employee of or counsel to the Company.

 

“Person” or “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 syndicate or group that would be deemed to
be a “person” under Section 13(d)(3) of the Exchange Act or any other
entity.

 

“Regular Record Date”
means, with respect to each Interest Payment Date, the February 1 or August 1,
as the case may be, next preceding such Interest Payment Date.

 

“Responsible Officer”
means any officer of the Trustee in its Corporate Trust Office and also means,
with respect to a particular corporate trust matter, any other officer to whom
any corporate trust matter is referred because of his or her knowledge of and
familiarity with a particular subject.

 

“Rights” means any
common stock or preferred stock purchase right or warrant, as the case may be,
that all or substantially all shares of Common Stock are entitled to receive
under a Rights Plan.

 

6

 

“Rights Plan” means
the Company’s preferred shares rights plan in connection with the Rights
Agreement, dated as of July 1, 1991, and any preferred shares rights plan
or any similar plan adopted by the Company after the date hereof.

 

“SEC” means the Securities
and Exchange Commission.

 

“Securities” means
the up to $287,500,000 aggregate principal amount of 4.75% Convertible Senior
Subordinated Notes due 2013, or any of them (each a “Security”), as amended or supplemented
from time to time, that are issued under this Indenture.

 

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

 

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

 

“Senior Debt” means
the principal of, premium, if any, interest (including interest, to the extent
allowable, accruing subsequent to the filing of a petition initiating any
proceeding under any state, federal or foreign bankruptcy law, whether or not a
claim for post-petition interest is allowable as a claim in any such
proceeding) and rent payable on or termination payments with respect to or in
connection with, and all fees, costs, expenses and other amounts accrued or due
on or in connection with, Indebtedness of the Company, whether outstanding on
the date of this Indenture or thereafter created, incurred, assumed, guaranteed
or in effect guaranteed by the Company (including all deferrals, renewals,
extensions or refundings of, or amendments, modifications or supplements to,
the foregoing), except for:

 

(i) Indebtedness that by its terms expressly provides that it
shall not be senior in right of payment to the Securities or expressly provides
that such Indebtedness is equal with or junior to the Securities; and

 

(ii) Indebtedness between or among the Company or any of the
Subsidiaries of the Company.

 

“Significant Subsidiary”
means (i) any direct or indirect Subsidiary of the Company that would be a
“significant subsidiary” as defined in Article 1, Rule 1-02 of
Regulation S-X, promulgated pursuant to the Securities Act, as such regulation
is in effect on the date hereof, or (ii) any group of direct or indirect
Subsidiaries of the Company that, taken together as a group, would be a “significant
subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such regulation is in effect on
the date hereof.

 

“Special Record Date”
for the payment of any Defaulted Interest means a date fixed by the Company
pursuant to Section 2.15 hereof.

 

“Stated Maturity”
when used with respect to any Security or any installment of principal thereof
or interest thereon, means the date specified in such Security as the fixed
date on which the principal of such Security or such installment of principal
or interest is due and payable.

 

7

 

“Stock Price” means
the price paid per share of the Company’s Common Stock in connection with a
Fundamental Change as determined pursuant to Section 4.01(i).

 

“Subsidiary” means
a corporation or other entity more than 50% of the outstanding Voting Stock of
which is owned, directly or indirectly, by the Company or by one or more other
Subsidiaries of the Company, or by the Company and one or more other
Subsidiaries of the Company.

 

“Termination of Trading”
means the occurrence of the Company’s Common Stock (or other common stock for
which the Securities are then convertible) not being listed for trading on a United
States national securities exchange nor approved for on any United States
system of automated dissemination of quotations of securities prices or
approved for trading on an established automated over-the-counter trading
market in the United States.

 

“TIA” means the
Trust Indenture Act of 1939 (15 U.S. Code §§ 77aaa-77bbbb) as in effect on the
date of this Indenture; provided, however, that in the event the Trust
Indenture Act of 1939 is amended after such date, “TIA” means, to the extent
required by any such amendment, the Trust Indenture Act as so amended.

 

“Trading Day” means
any day on which the Nasdaq Global Market or, if the Company’s Common Stock is
not traded on the Nasdaq Global Select Market, the principal national
securities exchange on which the Company’s Common Stock is listed, is open for
trading or, if the Company’s Common Stock is listed on the New York Stock
Exchange, a day on which trades may be made on such market or, if the
applicable Security is not so listed, admitted for trading or quoted, any
Business Day. A Trading Day only includes those days that have a scheduled
closing time of 4:00 p.m. (New York City time) or the then-standard
closing time for regular trading on the relevant exchange or trading system.

 

“Trust Officer”
means, with respect to the Trustee, any officer assigned to the Corporate Trust
Office, and also, with respect to a particular matter, any other officer to
whom such matter is referred because of such officer’s knowledge of and
familiarity with the particular subject.

 

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

 

“Underwriters”
means underwriters named in Schedule A of the Underwriting Agreement.

 

“U.S. Government Obligations”
means securities which are (i) direct obligations of The United States of
America for the payment of which its full faith and credit is pledged or (ii) obligations
of a person controlled or supervised by and acting as an agency or
instrumentality of The United States of America the payment of which is
unconditionally guaranteed as a full faith and credit obligation by The United
States of America, and which in the case of (i) and (ii) are not
callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank or trust company as custodian
with respect to any such U.S. Government Obligation or a specific payment of
interest on or principal of any such U.S. Government Obligation.

 

8

 

“Voting Stock” of a
Person means all classes of Capital Stock or other interests (including
partnership interests) of such Person then outstanding and normally entitled
(without regard to the occurrence of any contingency within the control of such
person to satisfy) to vote in the election of directors, managers or trustees
thereof.

 

9

 

Section 1.02                   Other
Definitions.

 

	
  Term

  	
   

  	
  Defined in Section

  
	
   

  	
   

  	
   

  
	
  “Agent Members”

  	
   

  	
  2.07(g)

  
	
  “Bankruptcy Law”

  	
   

  	
  8.01

  
	
  “Conversion
  Agent”

  	
   

  	
  2.04

  
	
  “Conversion
  Date”

  	
   

  	
  4.02(a)

  
	
  “Current Market
  Price”

  	
   

  	
  4.07(a)(9)

  
	
  “Drop Agent’s
  Office”

  	
   

  	
  2.04

  
	
  “Event of
  Default”

  	
   

  	
  8.01

  
	
  “Expiration
  Time”

  	
   

  	
  4.07(a)(7)

  
	
  “Fundamental
  Change Company Notice”

  	
   

  	
  3.08(b)

  
	
  “Fundamental
  Change Repurchase Date”

  	
   

  	
  3.08(a)

  
	
  “Fundamental
  Change Repurchase Notice”

  	
   

  	
  3.08(c)

  
	
  “Indenture”

  	
   

  	
  Recitals

  
	
  “Make-Whole
  Premium”

  	
   

  	
  4.01(e)

  
	
  “Measurement
  Period”

  	
   

  	
  4.07(a)(4)

  
	
  “Paying Agent”

  	
   

  	
  2.04

  
	
  “Purchased
  Shares”

  	
   

  	
  4.07(a)(7)(i)

  
	
  “record date”

  	
   

  	
  4.07(a)(9)(C)

  
	
  “Receiver”

  	
   

  	
  8.01

  
	
  “Redemption
  Price”

  	
   

  	
  3.01

  
	
  “Redemption
  Date”

  	
   

  	
  3.01

  
	
  “Registrar”

  	
   

  	
  2.04

  
	
  “Special
  Interest”

  	
   

  	
  8.02

  
	
  “Service Agent”

  	
   

  	
  2.04

  
	
  “Spin-off”

  	
   

  	
  4.07(a)(4)

  
	
  “Trigger Event”

  	
   

  	
  4.07(a)(4)

  
	
  “Trustee”

  	
   

  	
  Preamble

  
	
  “Underwriting
  Agreement”

  	
   

  	
  2.01

  

 

10

 

Article 2

The Securities

 

Section 2.01           Designation,
Form and Dating.

 

There is hereby
authorized a series of senior subordinated unsecured Securities designated as “4.75%
Convertible Senior Subordinated Notes due 2013.” The Securities are being
offered and sold pursuant to an Underwriting Agreement, dated February 12,
2008 (the “Underwriting Agreement”),
between the Company and the Underwriters.

 

The Securities and
the Trustee’s certificate of authentication to be borne by such Securities
shall be substantially in the form set forth in Exhibit A. The terms and
provisions contained in the form of Securities 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.

 

Any of the
Securities 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 Trustee, the Depositary, 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 Securities may be listed, or to conform to usage,
or to indicate any special limitations or restrictions to which any particular
Securities are subject.

 

Subject to Section 2.07
hereof, so long as the Securities are eligible for book-entry settlement with
the Depositary, or unless otherwise required by law, all of the Securities will
be represented by one or more Global Securities. The transfer and exchange of
beneficial interests in any such Global Security shall be effected through the
Depositary in accordance with this Indenture and the Applicable Procedures.

 

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

 

Section 2.02           Final Maturity Date;
Interest.

 

The Final Maturity
Date of the Securities shall be February 15, 2013.

 

The rate or rates
at which the Securities shall bear interest, including Special Interest, if
any, the date or dates from which such interest shall accrue, the Interest
Payment Dates on which such interest shall be payable and the Regular Record
Date for any interest payable on any Interest Payment Date, in each case, shall
be as set forth in the form of Security set forth as Exhibit A hereto.

 

11

 

Section 2.03.               Execution and Authentication.

 

Two Officers shall sign the
Securities for the Company by manual or facsimile signature.

 

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

 

A Security shall not be
valid until authenticated by the manual signature of the Trustee or an
authenticating agent. The signature shall be conclusive evidence that the
Security has been authenticated under this Indenture.

 

The Trustee shall
authenticate Securities for original issue in the aggregate principal amount up
to $250,000,000 aggregate principal amount ($287,500,000 aggregate principal
amount if the Underwriters exercise their over-allotment option in full by
executing an over-allotment exercise notice and delivering such executed
over-allotment exercise notice to the Trustee and the Company), upon receipt by
the Trustee of a Company Order. Such Company Order may authorize authentication
and delivery pursuant to oral or electronic instructions from the Company or
its duly authorized agent or agents, which oral instructions shall be promptly
confirmed in writing. Each Security shall be dated the date of its
authentication unless otherwise provided by a Board Resolution, a supplemental
indenture hereto or an Officers’ Certificate.

 

Prior to the issuance of
Securities of any Series, the Trustee shall have received and (subject to Section 9.02)
shall be fully protected in relying on: (a) the Board Resolution or
Officers’ Certificate establishing the form of the Securities and the terms of
the Securities, (b) an Officers’ Certificate complying with Section 13.05,
and (c) an Opinion of Counsel complying with Section 13.05.

 

The Trustee shall have the
right to decline to authenticate and deliver any Securities of such Series: (a) if
the Trustee, being advised by counsel, determines that such action may not
lawfully be taken; or (b) if the Trustee in good faith shall determine
that such action would expose the Trustee to personal liability to Holders of
any then outstanding Securities.

 

The Trustee may appoint an
authenticating agent reasonably acceptable to the Company to authenticate
Securities. An authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with the Company or an Affiliate.

 

Section 2.04           Registrar, Paying
Agent, Conversion Agent and Trustee.

 

The Company shall maintain
an office or agency where Securities of such Series may be presented or
surrendered for payment (“Paying Agent”),
where the Securities may be surrendered for registration of transfer or
exchange (“Registrar”) and
where notices and demands to or upon the Company in respect of the Securities
and this Indenture may be served (“Service
Agent”). The Registrar shall keep a register with respect to the
Securities and to their transfer and exchange. The Company will give prompt
written notice to the Trustee of the name and address, and any change in the
name or address, of each Registrar, Paying Agent or Service 

 

12

 

Agent. If at any time the Company shall fail to
maintain any such required Registrar, Paying Agent or Service Agent or shall
fail to furnish the Trustee with the name and address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.

 

The Company may also from
time to time designate one or more co-registrars, additional paying agents or
additional service agents and may from time to time rescind such designations; provided, however, that no such
designation or rescission shall in any manner relieve the Company of its
obligations to maintain a Registrar, Paying Agent and Service Agent in each place
for the Securities for such purposes. The Company will give prompt written
notice to the Trustee of any such designation or rescission and of any change
in the name or address of any such co-registrar, additional paying agent or
additional service agent. The term “Registrar” includes any co-registrar; the
term “Paying Agent” includes any additional paying agent; and the term “Service
Agent” includes any additional service agent.

 

The Company hereby appoints
the Trustee the initial Registrar, Paying Agent and Service Agent for the
Securities unless another Registrar, Paying Agent or Service Agent, as the case
may be, is appointed prior to the time the Securities are first issued.

 

The rights,
privileges, protections, immunities and benefits given to the Trustee under
this Indenture including, without limitation, its right to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and each Agent acting hereunder.

 

The Company shall
maintain an office or agency where Securities may be presented for conversion
(the “Conversion Agent”).
The Company hereby initially designates the Trustee as the Conversion Agent.
The Company further designates the office of the Trustee’s drop agent in New
York City (U.S. Bank National Association, 100 Wall Street, New York, New York
10005) (the “Drop Agent’s Office”)
as its office in The City of New York where Securities may be:

 

(1) presented
or surrendered for payment;

 

(2) surrendered
for registration of transfer or exchange; or

 

(3) surrendered
for conversion;

 

and where notices
and demands to or upon the Company in respect of the Securities and this
Indenture may be served.

 

The Company may at
any time and from time to time vary or terminate the appointment of any such office
or appoint any additional offices for any or all of such purposes; provided, however, that until all of the
Securities have been delivered to the Trustee for cancellation, or moneys
sufficient to pay the principal of and premium, if any, and interest, including
Special Interest, if any, on the Securities have been made available for
payment and either paid or returned to the Company pursuant to the provisions
of Section 11.02 hereof, the Company will maintain in The City of New York
an office or agency where Securities may be presented or surrendered for
payment, where Securities may be surrendered for registration of transfer or 

 

13

 

exchange, where Securities may be surrendered for conversion and where
notices and demands to or upon the Company in respect of the Securities and
this Indenture may be served. The Company will give prompt written notice to
the Trustee, and notice to the Holders, of the appointment or termination of
any such agents and of the location and any change in the location of any such
office or agency.

 

If at any time the
Company shall fail to maintain any such required office or agency in The City
of New York, or shall fail to furnish the Trustee with the address thereof,
presentations and surrenders may be made at, and notices and demands may be
served on, the Drop Agent’s Office.

 

The Company may
also from time to time designate one or more Conversion Agents and 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 name
or address of such Conversion Agent.

 

The rights,
privileges, protections, immunities and benefits given to the Trustee under the
Indenture and this Indenture, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in each
of its capacities hereunder, and each Conversion Agent or other Agent acting
hereunder.

 

Section 2.05           Paying Agent to Hold
Money in Trust.

 

The Company shall require
each Paying Agent other than the Trustee to agree in writing that the Paying
Agent will hold in trust, for the benefit of Holders of Securities, or the
Trustee, all money held by the Paying Agent for the payment of principal of or
interest on the Securities, and will notify the Trustee of any default by the
Company in making any such payment. While any such default continues, the
Trustee may require a Paying Agent to pay all money held by it to the Trustee.
The Company at any time may require a Paying Agent to pay all money held by it
to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other
than the Company or a Subsidiary) shall have no further liability for the
money. If the Company or a Subsidiary acts as Paying Agent, it shall segregate
and hold in a separate trust fund for the benefit of Holders of the Securities
all money held by it as Paying Agent.

 

Section 2.06           Conversion Agent to
Hold Shares in Trust.

 

The Company shall
require each Conversion Agent other than the Trustee to agree in writing that
the Conversion Agent will hold in trust for the benefit of Holders or the
Trustee all shares of Common Stock held by the Conversion Agent for the
delivery of Common Stock when due upon conversion, and will notify the Trustee
in writing of any default by the Company in making any such delivery. While any
such default continues, the Trustee may require a Conversion Agent to deliver
all shares of Common Stock held by it to the Trustee. The Company at any time
may require a Conversion Agent to pay all money held by it to the Trustee. Upon
such acknowledgement by the Trustee of its receipt of any such payment, the
Conversion Agent (if other than the Company or a Subsidiary) shall have no
further liability for such money. If the Company or a Subsidiary acts as
Conversion Agent, it shall segregate and hold in a separate trust fund for the
benefit of the Holders all shares held by it as Conversion Agent. Upon any 

 

14

 

bankruptcy or reorganization proceedings relating to the Company, the
Trustee shall serve as Conversion Agent for the Securities.

 

Section 2.07           Global Securities.

 

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

 

(b) 
Notwithstanding any other provisions of this Indenture or the Securities,
transfers of a Global Security, in whole or in part, shall be made only in
accordance with Sections 2.09 and this Section 2.07. A Global Security may
not be transferred, in whole or in part, to any Person other than the
Depositary or a nominee or any successor thereof, and no such transfer to any
such other Person may be registered; provided
that this clause (b) shall not prohibit any transfer of a
Security that is issued in exchange for a Global Security but is not itself a
Global Security. No transfer of a Security to any Person shall be effective
under this Indenture unless and until such Security has been registered in the
name of such Person.

 

(c) 
Notwithstanding any other provisions of this Indenture or the Securities, a
Global Security shall not be exchanged in whole or in part for a Security
registered in the name of any Person other than the Depositary or one or more
nominees thereof; provided that a
Global Security may be exchanged for Securities registered in the names of any
Person designated by the Depositary in the event that (i) the Depositary
has notified the Company that it is unwilling or unable to continue as
depositary for such Global Security or the Depositary ceases to be a clearing
agency registered under the Exchange Act and a successor depositary is not
appointed by the Company within 90 days, (ii) the Company by written
notice to the Trustee elects to issue the Securities in definitive registered
form in exchange for all or any part of the Securities represented by the
Global Security, or (iii) there is or continues to be an Event of Default
and the Registrar receives notice from the Depositary for the issuance of
definitively registered Securities in exchange for the Global Security. Any Global
Security exchanged pursuant to clause (a) above shall be so exchanged in
whole and not in part. Any Security issued in exchange for a Global Security or
any portion thereof shall be a Global Security; provided that any such Security so issued that is registered
in the name of a Person other than the Depositary or a nominee thereof shall
not be a Global Security.

 

(d) 
Securities issued in exchange for a Global Security or any portion thereof
shall be issued in definitive, fully registered form, without interest coupons,
shall have a principal amount equal to that of such Global Security or portion
thereof to be so exchanged, and shall be registered in such names and be in
such authorized denominations as the Depositary shall designate. Any Global Security
to be exchanged in whole shall be surrendered by the Depositary to the Trustee
or the Registrar. With regard to any Global Security to be exchanged in part,
either such Global Security shall be so surrendered for exchange or, if the
Trustee is acting as custodian for the Depositary or its nominee with respect
to such Global Security, the principal amount thereof shall be reduced, by an
amount equal to the portion thereof to be so exchanged, by means of an
appropriate adjustment made on the records of the Trustee. Upon any such
surrender or 

 

15

 

adjustment, the
Trustee shall authenticate and deliver the Security issuable on such exchange
to or upon the order of the Depositary or an authorized representative thereof.

 

(e) 
Subject to the provisions of Section 2.07(g) below, the registered
Holder may grant proxies and otherwise authorize any Person, including Agent
Members (as defined below) and Persons that may hold interests through Agent
Members, to take any action which a Holder is entitled to take under this
Indenture or the Securities.

 

(f) 
In the event of the occurrence of any of the events specified in Section 2.07(c) above,
the Company will promptly make available to the Trustee a reasonable supply of
certificated Securities in definitive, fully registered form, without interest
coupons.

 

(g) 
Neither any members of, or participants in, the Depositary (collectively, the “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 Security registered in the name of the
Depositary or any nominee thereof, or under any such Global Security, and the
Depositary or such nominee, as the case may be, may be treated by the Company,
the Trustee and any agent of the Company or the Trustee as the absolute owner
and Holder of such Global Security for all purposes whatsoever. Notwithstanding
the foregoing, nothing herein shall prevent the Company or 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 other person on whose behalf an Agent Member may act, the
operation of customary practices of such Persons governing the exercise of the
rights of a holder of any Security.

 

(h) 
At such time as all interests in a Global Security have been repurchased,
converted, cancelled or exchanged for Securities in certificated form, such
Global Security shall, upon receipt thereof, be cancelled by the Trustee in
accordance with standing procedures and instructions existing between the
Depositary and the Securities Custodian, subject to Section 2.14 of the
Indenture. At any time prior to such cancellation, if any interest in a Global
Security is repurchased, converted, cancelled or exchanged for Securities in
certificated form, the principal amount of such Global Security shall, in
accordance with the standing procedures and instructions existing between the
Depositary and the Securities Custodian, be appropriately reduced, and an
endorsement shall be made on such Global Security, by the Trustee or the
Securities Custodian, at the direction of the Trustee, to reflect such
reduction.

 

Section 2.08                Holder Lists.

 

The Trustee shall preserve
in as current a form as is reasonably practicable the most recent list
available to it of the names and addresses of Holders of the Securities and
shall otherwise comply with TIA § 312(a). If the Trustee is not the Registrar,
the Company shall furnish to the Trustee at least ten 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 Holders of the Securities which list may be
conclusively relied upon by the Trustee.

 

16

 

Section 2.09                Transfer and Exchange.

 

Where the Securities are
presented to the Registrar or a co-registrar with a request to register a
transfer or to exchange them for an equal principal amount of Securities of the
same series, the Registrar shall register the transfer or make the exchange if
its requirements for such transactions are met. To permit registrations of
transfers and exchanges, the Trustee shall authenticate Securities at the
Registrar’s request. No service charge shall be made for any registration of
transfer or exchange (except as otherwise expressly permitted herein), but the
Company may require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in connection therewith (other than any
such transfer tax or similar governmental charge payable upon exchanges
pursuant to Sections 2.12, 3.07 or 10.05).

 

Neither the Company nor the
Registrar shall be required (a) to issue, register the transfer of, or
exchange the Securities for the period beginning at the opening of business
fifteen days immediately preceding the mailing of a notice of redemption of the
Securities selected for redemption and ending at the close of business on the
day of such mailing, or (b) to register the transfer of or exchange the
Securities selected, called or being called for redemption as a whole or the
portion being redeemed of any such Securities selected, called or being called
for redemption in part.

 

Section 2.10                Mutilated, Destroyed, Lost and Stolen
Securities.

 

If any mutilated Security is
surrendered to the Trustee, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a new Security and of like tenor
and principal amount and bearing a number not contemporaneously outstanding.

 

If there shall be delivered
to the Company and the Trustee (i) evidence to their satisfaction of the
destruction, loss or theft of any Security and (ii) such security or
indemnity as may be required by them to save each of them and any agent of
either of them harmless, then, in the absence of notice to the Company or the
Trustee that such Security has been acquired by a bona fide purchaser, the
Company shall execute and upon its written request the Trustee shall
authenticate and make available for delivery, in lieu of any such destroyed,
lost or stolen Security, a new Security and of like tenor and principal amount
and bearing a number not contemporaneously outstanding.

 

In case any such mutilated,
destroyed, lost or stolen Security has become or is about to become due and
payable, the Company in its discretion may, instead of issuing a new Security,
pay such Security.

 

Upon the issuance of any new
Security under this Section, the Company may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Trustee) connected therewith.

 

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

 

17

 

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

 

Section 2.11                Outstanding Securities.

 

The Securities outstanding
at any time are all the Securities authenticated by the Trustee except for
those canceled by it, those delivered to it for cancellation, those reductions
in the interest on a Global Security effected by the Trustee in accordance with
the provisions hereof and those described in this Section as not
outstanding.

 

If a Security is replaced
pursuant to Section 2.10, it ceases to be outstanding until the Trustee
receives proof satisfactory to it that the replaced Security is held by a bona
fide purchaser.

 

If the Paying Agent (other
than the Company, a Subsidiary or an Affiliate of any thereof) holds on the
Maturity of the Securities money sufficient to pay such Securities payable on
that date, then on and after that date such Securities cease to be outstanding
and interest on them ceases to accrue.

 

A Security does not cease to
be outstanding because the Company or an Affiliate holds the Security.

 

In determining whether the
Holders of the requisite principal amount of outstanding Securities have given
any request, demand, authorization, direction, notice, consent or waiver
hereunder, the principal amount of a Security that shall be deemed to be
outstanding for such purposes shall be the amount of the principal thereof that
would be due and payable as of the date of such determination upon a
declaration of acceleration of the Maturity thereof pursuant to Section 8.02.

 

Section 2.12                Treasury Securities.

 

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

 

Section 2.13                Temporary Securities.

 

Until definitive Securities
are ready for delivery, the Company may prepare and the Trustee shall
authenticate temporary Securities upon a Company Order. Temporary Securities
shall be substantially in the form of definitive Securities but may have
variations that the Company considers appropriate for temporary Securities.
Without unreasonable delay, the Company shall prepare and the Trustee upon
request shall authenticate definitive Securities and date of maturity in
exchange for temporary Securities. Until so exchanged, temporary securities
shall have the same rights under this Indenture as the definitive Securities.

 

18

 

Section 2.14                Cancellation.

 

The Company at any time may
deliver Securities to the Trustee for cancellation. The Registrar and the
Paying Agent shall forward to the Trustee any Securities surrendered to them
for registration of transfer, exchange or payment. The Trustee shall cancel all
Securities surrendered for transfer, exchange, payment, replacement or
cancellation in accordance with its customary procedure. The Company may not
issue new Securities to replace Securities that it has paid or delivered to the
Trustee for cancellation.

 

Section 2.15                Defaulted Interest.

 

If the Company defaults in a
payment of interest on the Securities, it shall pay the defaulted interest,
plus, to the extent permitted by law, any interest payable on the defaulted
interest (the “Defaulted Interest”),
to the persons who are Holders of the Securities on a subsequent Special Record
Date. The Company shall fix the Special Record Date and payment date. At least
30 days before the record date, the Company shall mail to the Trustee and to
each Holder of the Securities a notice that states the record date, the payment
date and the amount of interest to be paid. The Company may pay defaulted
interest in any other lawful manner.

 

Section 2.16                CUSIP Numbers.

 

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

 

19

 

Article 3

Redemption and Repurchase of Securities

 

Section 3.01                   Company’s Right to Redeem. The Securities will be subject to
redemption at the option of the Company, in whole or in part, on the terms and
at the redemption prices (expressed as percentages of principal amount) set
forth in paragraph 5 on the reverse of the form of Security (each a “Redemption Price”), plus accrued and
unpaid interest thereon (if any) to the date of redemption (the “Redemption Date”). However, if a
Redemption Date occurs after a Regular Record Date or a Special Record Date but
on or prior to the corresponding Interest Payment Date or Defaulted Interest
payment date, the Company will instead pay the applicable interest payment to
the record Holder on the Regular Record Date or Special Record Date
corresponding to such Interest Payment Date or Defaulted Interest payment date.

 

Section 3.02                   Notices to Trustee. If the Company elects to redeem Securities pursuant
to the optional redemption provisions of paragraph 5 of the Securities, it
shall furnish to the Trustee, at least 30 days but not more than 60 days before
a Redemption Date (unless a shorter period shall be satisfactory to the
Trustee), an Officers’ Certificate setting forth (i) the Section of
this Indenture pursuant to which the redemption shall occur, (ii) the
Redemption Date, (iii) the principal amount of Securities (if less than
all) to be redeemed, (iv) the Redemption Price and the amount of any
accrued and unpaid interest, if any, payable on the Redemption Date and (v) the
CUSIP number of the Securities being redeemed.

 

Section 3.03                   Selection of Securities To Be Redeemed. If less than all the Securities are to
be redeemed, the Trustee shall select the Securities to be redeemed by a method
that complies with the requirements of the principal national securities
exchange, if any, on which the Securities are listed or quoted or, if the
Securities are not so listed, on a pro rata basis, by lot or by any other
method that the Trustee considers fair and appropriate. The Trustee shall make
the selection not more than 60 days and not less than 30 days before the
Redemption Date from Securities outstanding and not previously called for
redemption. The Trustee may select for redemption a portion of the principal of
any Securities that has a denomination larger than $1,000. Securities and
portions thereof will be redeemed in the amount of $1,000 or integral multiples
of $1,000.

 

Provisions of this
Indenture that apply to Securities called for redemption also apply to portions
of Securities called for redemption. The Trustee shall notify the Company
promptly of the Securities or portions of Securities to be called for
redemption.

 

If any Security selected
for partial redemption is converted in part after such selection, the converted
portion of such Security shall be deemed (so far as possible) to be the portion
to be selected for redemption. The Securities (or portion thereof) so selected
shall be deemed duly selected for redemption for all purposes hereof,
notwithstanding that any such Security is converted in whole or in part before
the mailing of the notice of redemption. Upon any redemption of less than all
the Securities, the Company and the Trustee may treat as outstanding 

 

20

 

any Securities surrendered for conversion during the
period of 15 days immediately preceding the mailing of a notice of redemption
and need not treat as outstanding any Security authenticated and delivered
during such period in exchange for the unconverted portion of any Security
converted in part during such period.

 

In the event of any
redemption of less than all the Securities, the Company will not be required to
(i) issue or register the transfer or exchange of any Security during a
period of 15 days immediately preceding the mailing of a notice of redemption
for such Securities for redemption, or (ii) register the transfer or
exchange of any Security so selected for redemption, in whole or in part,
except the unredeemed portion of any Security being redeemed in part, in which
case the Company will execute and the Trustee will authenticate and deliver to
the Holder a new Security or Securities equal in principal amount to the
unredeemed portion of the Security surrendered.

 

Section 3.04                   Notice of Redemption. At least 30 days but not more than 60 days before a
Redemption Date, the Company shall mail by first class mail a notice of
redemption to each Holder whose Securities are to be redeemed, at such Holder’s
registered address.

 

The notice shall identify
the Securities to be redeemed and shall state:

 

(1) the Redemption Date;

 

(2) the Redemption Price and any accrued and unpaid interest
payable on the Redemption Date;

 

(3) if any Security is being redeemed in part, the portion of the
principal amount of such Security to be redeemed and that, after the Redemption
Date, upon surrender of such Security, a new Security or Securities in
principal amount equal to the unredeemed portion will be issued in the name of
the Holder thereof;

 

(4) that Securities called for redemption must be surrendered to
the Paying Agent to collect the Redemption Price and any accrued and unpaid
interest;

 

(5) that interest on Securities called for redemption and for
which funds have been set apart for payment, ceases to accrue on and after the
Redemption Date (unless the Company defaults in the payment of the Redemption
Price or any accrued and unpaid interest);

 

(6) the aggregate principal amount of Securities (if less than
all) that are being redeemed;

 

(7) the CUSIP number of the Securities (provided that any such notice may state that no
representation is made as to the correctness or accuracy of the CUSIP numbers
printed in the notice or on the Securities and that reliance may be placed only
on the other identification numbers printed on the Securities);

 

(8) the name and address of the Paying Agent;

 

21

 

(9) that Securities called for redemption may be converted at any
time prior to the close of business on the last Trading Day immediately
preceding the Redemption Date and if not converted prior to the close of
business on such date, the right of conversion will be lost; and

 

(10) that in the case of Securities or portions thereof called for
redemption on a date that is also an Interest Payment Date or a Defaulted
Interest payment date, the interest due on such date shall be paid to the
Holder of such Security at the close of business on the relevant Regular Record
Date or Special Record Date.

 

The notice, if mailed in
the manner herein provided, shall be conclusively presumed to have been given,
whether or not the Holder receives such notice. In any case, failure to give
such notice by mail or any defect in the notice to any Holder designated for
redemption as a whole or in part shall not affect the validity of the
proceedings for the redemption of any Security.

 

At
the Company’s request, the Trustee shall give notice of redemption in the
Company’s name and at the Company’s expense.

 

Section 3.05                   Effect of Notice of Redemption. Once notice of redemption is mailed,
Securities called for redemption become due and payable on the Redemption Date
at the Redemption Price set forth in the Security.

 

Section 3.06                   Deposit of Redemption Price. On or before 11:00 a.m. New York
City time on the Redemption Date, the Company shall deposit with the Trustee or
with the Paying Agent money in immediately available funds sufficient to pay
the Redemption Price of and accrued interest, if any, on all Securities to be
redeemed on that date. The Trustee or the Paying Agent shall return to the
Company any money not required for that purpose.

 

On
and after the Redemption Date, unless the Company shall default in the payment
of the Redemption Price or any accrued and unpaid interest, interest will cease
to accrue on the principal amount of the Securities or portions thereof called
for redemption and for which funds have been set apart for payment, and such
Securities, or portions thereof, shall cease after the close of business on the
Business Day immediately preceding the Redemption Date to be convertible into
Common Stock and, except as provided in this Section 3.06, to be entitled
to any benefit or security under the Indenture, and the Holders thereof shall
have no right in respect of such Securities, or portions thereof, except the
right to receive the Redemption Price thereof and unpaid interest to (but
excluding) the Redemption Date. In the case of Securities or portions thereof
redeemed on a Redemption Date which is after a Regular Record Date or a Special
Record Date and on or prior to the corresponding Interest Payment Date or
Defaulted Interest payment date, the interest due on such date shall be paid to
the Person in whose name the Security is registered at the close of business on
the relevant Regular Record Date or Special Record Date.

 

22

 

Section 3.07                   Securities Redeemed in Part. Upon surrender of a Security that is
redeemed in part only, the Company shall issue and the Trustee shall
authenticate and deliver to the Holder of such Security a new Security or
Securities equal in principal amount to the unredeemed portion of the Security
surrendered, at the expense of the Company.

 

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

 

(a)   If
a Fundamental Change occurs prior to the Final Maturity Date, each Holder of a
Security shall have the right, at the option of the Holder, to require the
Company to repurchase for cash all or any portion of the Securities of such
Holder equal to $1,000 principal amount (or an integral multiple thereof) at
the Fundamental Change Repurchase Price, on the date specified by the Company
that is 45 days after the date of the Fundamental Change Company Notice
pursuant to subsection 3.08(b) (the “Fundamental
Change Repurchase Date”).

 

(b)  As promptly as practicable following the
date on which the Company publicly announces a Fundamental Change, but in no
event less than 20 days prior to the anticipated effective date of a
Fundamental Change, the Company shall mail a written notice of the Fundamental
Change and of the resulting repurchase right to the Trustee, Paying Agent and
to each Holder (and to beneficial owners as required by applicable law) (the “Fundamental Change Company Notice”).
The Fundamental Change Company Notice shall include the form of a Fundamental
Change Repurchase Notice to be completed by the Holder and shall state:

 

(1) the events causing such Fundamental Change;

 

(2) the date (or expected date) of such Fundamental Change;

 

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

 

(4) the Fundamental Change Repurchase Date;

 

(5) the Fundamental Change Repurchase Price;

 

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

 

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

 

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

 

(9) whether a Make-Whole Premium shall be payable by the Company
upon conversion;

 

(10) the procedures that the Holder must follow to exercise rights
under Article 4;

 

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

 

23

 

(12) that, unless the Company fails to pay such Fundamental Change
Repurchase Price, Securities covered by any Fundamental Change Repurchase
Notice will cease to be outstanding and interest, including Special Interest,
if any, will cease to accrue on and after the Fundamental Change Repurchase
Date, subject to Section 3.10 hereof; and

 

(13) the CUSIP number of the Securities.

 

At the Company’s written request, the Trustee shall give such
Fundamental Change Company Notice in the Company’s name and at the Company’s
expense; provided that, in all
cases, the Company makes such request at least three (3) Business Days
prior to the date by which such Fundamental Change Company Notice must be given
to the Holders in accordance with this Section 3.08; provided, further, that the text of such
Fundamental Change Company Notice shall be prepared by the Company. In
connection with the delivery of the Fundamental Change Company Notice to the
Holders, the Company shall disseminate a press release through Dow Jones &
Company, Inc. or Bloomberg Business News, or publish a notice containing
substantially the same information that is required in the Fundamental Change
Company Notice in a newspaper of general circulation in The City of New York,
or publish information on a website of the Company or through such other public
medium the Company may use at that time. If any of the Securities is in the
form of a Global Security, then the Company shall modify such notice to the
extent necessary to accord with the Applicable Procedures relating to the
purchase of Global Securities.

 

No failure of the Company to give the foregoing notices or defect
therein shall limit any Holder’s right to exercise its right to cause the
Company to repurchase such Holder’s Securities pursuant to this Section 3.08.

 

(c)  A Holder may exercise its rights specified
in Section 3.08(a) upon delivery of a written notice (which shall be
in substantially the form attached as Exhibit A under the heading “Fundamental
Change Repurchase Notice” and which may be delivered by letter, overnight
courier, hand delivery, facsimile transmission or in any other written form
and, in the case of Global Securities, may be delivered electronically or by
other means in accordance with the Depositary’s Applicable Procedures) of the
exercise of such rights (a “Fundamental
Change Repurchase Notice”) to the Paying Agent at any time prior
to the close of business on the 30th day following the date of the Fundamental
Change Company Notice, subject to extension to comply with applicable law.

 

(1) The Fundamental Change Repurchase Notice shall state: (A) the
certificate number (if such Security is held other than in global form) of the
Security which the Holder will deliver to be repurchased (or, if the Security
is held in global form, any other items required to comply with the Applicable
Procedures), (B) the portion of the principal amount of the Security which
the Holder will deliver to be repurchased and, (C) that such Security
shall be repurchased as of the Fundamental Change Repurchase Date pursuant to
the terms and conditions specified in the Securities and in this Indenture.

 

(2) The delivery of a Security for which a Fundamental Change
Repurchase Notice has been timely delivered to any Paying Agent on or after the
Fundamental Change Repurchase Date 

 

24

 

(together with all necessary endorsements) at the
office of such Paying Agent shall be a condition to the receipt by the Holder
of the Fundamental Change Repurchase Price therefor.

 

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

 

(4) A Paying Agent shall promptly notify the Company of the
receipt by it of any Fundamental Change Repurchase Notice.

 

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

 

(6) A Fundamental Change Repurchase Notice shall be irrevocable,
except that the right of the Holder to convert the Securities that are the
subject of the Fundamental Change Repurchase Notice shall continue until the
close of business on the second Business Day immediately preceding the
Fundamental Change Repurchase Date.

 

(d)  The Company shall deposit cash, at the time
and in the manner as provided in Section 3.10, sufficient to pay the
aggregate Fundamental Change Repurchase Price of all Securities to be purchased
pursuant to this Section 3.08.

 

Section 3.09                   Effect of Fundamental Change Repurchase Notice.

 

Upon receipt by any Paying Agent of a properly completed Fundamental
Change Repurchase Notice from a Holder, the Holder of the Security in respect
of which such Fundamental Change Repurchase Notice was given shall thereafter
be entitled to receive the Fundamental Change Repurchase Price with respect to
such Security, subject to the occurrence of the Fundamental Change Effective
Date. Such Fundamental Change Repurchase Price shall be paid to such Holder
promptly, but no later than two Business Days, following the later of (1) the
Fundamental Change Repurchase Date (provided
that the conditions in Section 3.08 have been satisfied), and (2) the
time of delivery of such Security to a Paying Agent by the Holder thereof in
the manner required by Section 3.08(c).

 

Section 3.10                   Deposit of Fundamental Change Repurchase Price.

 

(a)  On or before 10:00 a.m. New York City
time on the Business Day following the applicable Fundamental Change Repurchase
Date, the Company shall deposit with the Paying Agent (or, if the Company or an
Affiliate of the Company is acting as the Paying Agent, shall segregate and
hold in trust as provided in Section 2.05 of this Indenture) an amount of
money (in immediately available funds if deposited on or after such Fundamental
Change Repurchase Date) sufficient to pay the aggregate Fundamental Change
Repurchase Price of all the Securities or portions thereof that are to be
purchased as of the Fundamental Change Repurchase Date.

 

25

 

(b)  If a Paying Agent holds on the Business Day
following the Fundamental Change Repurchase Date, in accordance with the terms
hereof, money sufficient to pay the Fundamental Change Repurchase Price of any
Security for which a Fundamental Change Repurchase Notice has been tendered and
not withdrawn in accordance with this Indenture then, immediately following the
applicable Fundamental Change Repurchase Date, whether or not the Security is
delivered to the Paying Agent, each such Security will cease to be outstanding,
interest, including Special Interest, if any, shall cease to accrue, and the
rights of the Holder in respect of the Security shall terminate (other than the
right to receive the Fundamental Change Repurchase Price upon delivery of the
Security as aforesaid).

 

(c)  If a Fundamental Change Repurchase Date
falls after a Regular Record Date and on or before the related Interest Payment
Date, then interest on the Securities payable on such Interest Payment Date
will be payable to the Holders in whose names the Securities are registered at
the close of business on such Regular Record Date.

 

Section 3.11                   Repayment to the Company.

 

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

 

Section 3.12                   [Reserved].

 

Section 3.13                   Securities Purchased in Part.

 

Any Security that is to be purchased only in part shall be surrendered
at the office of a Paying Agent, and, promptly after the Fundamental Change
Repurchase Date, the Company shall execute and the Trustee shall authenticate
and deliver to the Holder of such Security, without service charge, a new
Security or Securities, of such authorized denomination or denominations as may
be requested by such Holder (which must be equal to $1,000 principal amount or
any integral thereof), in aggregate principal amount equal to, and in exchange
for, the portion of the principal amount of the Security so surrendered that is
not purchased.

 

Section 3.14                   Compliance with Securities Laws upon Purchase of
Securities.

 

In connection with any offer to purchase Securities under Section 3.08,
the Company shall (a) comply with Rule 13e-4 and Rule 14e-1 (or
any successor to either such Rule), and any other tender offer rules, if
applicable, under the Exchange Act, (b) file the related Schedule TO (or
any successor or similar schedule, form or report) if required under the
Exchange Act, and (c) otherwise comply with all federal and state
securities laws in connection with such offer to purchase or purchase of
Securities, all so as to permit the rights of the Holders and obligations of
the Company under Sections 3.08 through 3.11 to be exercised in the time and in
the manner specified therein. To the extent that compliance with any such laws,
rules and regulations would result in a conflict with any of the terms
hereof, this Indenture is hereby modified to the extent required for the
Company to comply with such laws, rules and regulations.

 

26

 

Section 3.15                   Purchase of Securities in Open Market.

 

The Company shall surrender any Security repurchased by the Company
pursuant to this Article 3 to the Trustee for cancellation. Any Securities
surrendered to the Trustee for cancellation may not be reissued or resold by
the Company and will be cancelled promptly in accordance with Section 2.14
of this Indenture. The Company may purchase Securities in the open market, by
tender at any price or pursuant to private agreements.

 

Article 4

Conversion

 

Section 4.01                   Conversion Privilege and Conversion Rate.

 

(a)  The conversion rights pursuant to this Article 4
shall commence on the Issue Date of the Securities and expire at the close of
business on the second Business Day immediately preceding the Final Maturity
Date, subject, in the case of conversion of any Global Security, to any
Applicable Procedures. If a Security is submitted or presented for purchase or
redemption pursuant to Article 3, such conversion right shall terminate at
the close of business on the second Business Day immediately preceding the
Fundamental Change Repurchase Date or Redemption Date for such Security (unless
the Company shall fail to make the Fundamental Change Repurchase Price or Redemption
Price payment when due in accordance with Article 3, in which case the
conversion right shall terminate at the close of business on the date such
failure is cured and such Security is purchased or redeemed).

 

(b)  Provisions of this Indenture that apply to
conversion of all of a Security also apply to conversion of a portion of a
Security.

 

(c)  A Holder of Securities is not entitled to
any rights of a holder of Common Stock until such Holder has converted its
Securities into Common Stock, and only to the extent such Securities are deemed
to have been converted into Common Stock pursuant to this Article 4.

 

(d)  The Conversion Rate shall be adjusted in
certain instances as provided in Section 4.01(e) and Section 4.07.

 

(e)  If there shall have occurred a transaction
described in clause (i) or (ii) of the definition of a Change in
Control, the Company shall pay a “Make-Whole
Premium” to the Holders of the Securities who convert their
Securities during the period beginning 20 days before the anticipated
Fundamental Change Effective Date until the close of business on the Business
Day immediately preceding the Fundamental Change Repurchase Date by increasing
the Conversion Rate for such Securities. The number of additional shares of
Common Stock per $1,000 principal amount of Securities constituting the
Make-Whole Premium shall be determined by reference to the table below, based
on the Fundamental Change Effective Date of such Fundamental Change and the
Stock Price; provided that if the
Stock Price or Fundamental Change Effective Date are not set forth on the
table: (i) if the actual Stock Price on the Fundamental Change Effective
Date is between two Stock Prices on the table or the actual Fundamental Change
Effective Date is between two Fundamental Change Effective Dates on the table,
the Make-Whole Premium will be determined by a straight-line interpolation
between the Make-Whole Premiums set forth for the two Stock Prices and the two
Fundamental Change 

 

27

 

Effective
Dates on the table based on a 365-day year, as applicable, (ii) if the
Stock Price on the Fundamental Change Effective Date exceeds $80.00 per share,
subject to adjustment as set forth herein, no Make-Whole Premium will be paid,
and (iii) if the Stock Price on the Fundamental Change Effective Date is
less than $17.14 per share, subject to adjustment as set forth herein, no
Make-Whole Premium will be paid. If Holders of the Company’s Common Stock
receive only cash in the transaction, the Stock Price shall be the cash amount
paid per share of the Company’s Common Stock in connection with the Fundamental
Change. Otherwise, the Stock Price shall be equal to the average Closing Price
of the Company’s Common Stock over the 15 Trading Day period ending on the
Trading Day immediately preceding, and excluding, the applicable Fundamental
Change Effective Date.

 

Make-Whole Premium Upon a
Fundamental Change (Number of Additional Shares)

 

	
  Stock Price on

  	
   

  	
  Make Whole Premium Upon Fundamental Change
  (Increase in Applicable Conversion Rate)

  	
   

  
	
  Effective Date

  	
   

  	
  2/19/2008

  	
   

  	
  2/15/2009

  	
   

  	
  2/15/2010

  	
   

  	
  2/15/2011

  	
   

  	
  2/15/2012

  	
   

  	
  2/15/2013

  	
   

  
	
  $

  	
  17.14

  	
   

  	
  15.1259

  	
   

  	
  15.1259

  	
   

  	
  15.1259

  	
   

  	
  15.1259

  	
   

  	
  15.1259

  	
   

  	
  15.1259

  	
   

  
	
  20.00

  	
   

  	
  10.9491

  	
   

  	
  9.0836

  	
   

  	
  6.7829

  	
   

  	
  6.7829

  	
   

  	
  6.7829

  	
   

  	
  6.7829

  	
   

  
	
  22.50

  	
   

  	
  8.5116

  	
   

  	
  6.4661

  	
   

  	
  1.2273

  	
   

  	
  1.2273

  	
   

  	
  1.2273

  	
   

  	
  1.2273

  	
   

  
	
  25.00

  	
   

  	
  6.7916

  	
   

  	
  4.7189

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  
	
  30.00

  	
   

  	
  4.6376

  	
   

  	
  2.7475

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  
	
  35.00

  	
   

  	
  3.4279

  	
   

  	
  1.8197

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  
	
  40.00

  	
   

  	
  2.6988

  	
   

  	
  1.3526

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  
	
  60.00

  	
   

  	
  1.5021

  	
   

  	
  0.7504

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  
	
  80.00

  	
   

  	
  1.0826

  	
   

  	
  0.5596

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  
															

 

28

 

The Stock Prices
set forth in the first column of the table above will be adjusted as of any
date on which the Conversion Rate of the Securities is adjusted other than an
adjustment pursuant to the Make-Whole Premium described above. The adjusted
Stock Prices will equal the Stock Prices applicable immediately prior to such
adjustment multiplied by a fraction, the numerator of which is the Conversion
Rate immediately prior to the adjustment giving rise to the Stock Price
adjustment and the denominator of which is the Conversion Rate as so adjusted.
The number of additional shares set forth in the table above will be adjusted
in the same manner as the Conversion Rate as set forth in Section 4.07
hereof.

 

Notwithstanding
the foregoing paragraph, in no event will the total number of shares of Common
Stock issuable upon conversion of a Security exceed 58.3430 per $1,000
principal amount, subject to proportional adjustment in the same manner as the
Conversion Rate as set forth in clauses (1) through (7) of Section 4.07(a) hereof.

 

(f)  By delivering the number of shares of Common
Stock issuable on conversion to the Trustee plus a cash payment for a
fractional share, the Company will be deemed to have satisfied its obligation
to pay the principal amount of the Securities so converted and its obligation
to pay accrued and unpaid interest, including Special Interest, if any,
attributable to the period from the most recent Interest Payment Date through
the Conversion Date (which amount will be deemed cancelled, extinguished and
forfeited).

 

(g)  A conversion of the Securities by a Holder
will be deemed for purposes of Section 4.01(e) to be “in connection
with” certain Fundamental Change transactions if the conversion notice is
received by the Conversion Agent on or subsequent to the date 20 calendar days
prior to the date announced by the Company as the anticipated Fundamental
Change Effective Date of the related Fundamental Change but before the close of
business on the Business Day immediately preceding the related Fundamental
Repurchase Date. The Company will notify Holders of Securities of the
anticipated Fundamental Change Date as promptly as practicable following the
date the Company publicly announces such Fundamental Change, but in no event
less than 20 days prior to such date.

 

Section 4.02                   Conversion Procedure.

 

(a)  To convert a Security, a Holder must (1) complete
and manually sign the conversion notice on the back of the Security and deliver
such notice to the Conversion Agent, (2) surrender the Security to the
Conversion Agent, which shall become irrevocable upon receipt by the Conversion
Agent, (3) furnish appropriate endorsements and transfer documents if
required by the Registrar or the Conversion Agent, (4) pay an amount equal
to the interest, including Special Interest, if any, as required by Section 4.02(c),
and (5) pay all transfer or similar taxes, if required pursuant to Section 4.04.
The date on which the Holder satisfies all of those requirements is the “Conversion Date.” Upon the conversion
of a Security, the Company will deliver the shares of Common Stock, without
service charge, as promptly as practicable after the Conversion Date, but in no
event later than third Business Days after the Conversion Date. Anything herein
to the contrary notwithstanding, in the case of Global Securities, conversion
notices may be delivered and such Securities may be surrendered for conversion
in accordance 

 

29

 

with
clauses (3), (4) and (5) of this Section 4.02(a) and the
Applicable Procedures as in effect from time to time.

 

(b)  The person in whose name the shares of
Common Stock are issuable upon conversion shall be deemed to be a holder of
record of such Common Stock on the Conversion Date; provided, however, that no surrender of a Security on any
Conversion Date when the stock transfer books of the Company shall be closed
shall be effective to constitute the person or persons entitled to receive the
shares of Common Stock upon conversion as the record holder or holders of such
shares of Common Stock on such date, but such surrender shall be effective to
constitute the person or persons entitled to receive such shares of Common
Stock as the record holder or holders thereof for all purposes at the close of
business on the next succeeding day on which such stock transfer books are
open; provided, further, that
such conversion shall be at the Conversion Rate in effect on the Conversion
Date as if the stock transfer books of the Company had not been closed. Upon
conversion of a Security, such person shall no longer be a Holder of such
Security. Except as set forth in this Indenture, no payment or adjustment will
be made for dividends or distributions declared or made on shares of Common
Stock issued upon conversion of a Security prior to the issuance of such
shares.

 

(c)  Holders of Securities surrendered for
conversion (in whole or in part) during the period from the close of business
on any Regular Record Date to the opening of business on the next succeeding
Interest Payment Date will receive the semi-annual interest and Special
Interest, if any, payable on the principal amount of such Securities being
surrendered for conversion on the corresponding Interest Payment Date
notwithstanding the conversion. Upon surrender of any such Securities for
conversion, such Securities shall also be accompanied by payment in funds to
the Conversion Agent acceptable to the Company of an amount equal to the
interest, including Special Interest, if any, payable on such corresponding
Interest Payment Date (but excluding any overdue interest on the principal
amount of such Security so converted that exists at the time such Holder
surrenders such Security for conversion). Notwithstanding the foregoing, any
such Holder which surrenders for conversion any Security (a) with respect
to which the Company has specified a Fundamental Change Repurchase Date or a
Redemption Date, in either case, that is after such Regular Record Date and on
or prior to the next succeeding Interest Payment Date, or (b) after the
last Regular Record Date prior to the Final Maturity Date, in either case, need
not pay the Company an amount equal to the interest, including Special
Interest, if any, on the principal amount of such Security so converted at the
time such Holder surrenders such Security for conversion. Except as otherwise
provided in this Section 4.02(c), no payment or adjustment will be made
for accrued interest, including Special Interest, if any, on a converted
Security.

 

(d)  Subject to Section 4.02(c), nothing in
this Section shall affect the right of a Holder in whose name any Security
is registered at the close of business on a Regular Record Date to receive the
interest payable on such Security on the related Interest Payment Date in
accordance with the terms of this Indenture and the Securities. If a Holder
converts more than one Security at the same time, the number of shares of
Common Stock issuable upon the conversion (and the amount of any cash in lieu
of fractional shares pursuant to Section 4.03) shall be based on the
aggregate principal amount of all Securities so converted.

 

(e)  In the case of any Security which is
converted in part only, upon such conversion the Company shall execute and the
Trustee shall authenticate and deliver to the Holder thereof, 

 

30

 

without
service charge, a new Security or Securities of authorized denominations in an
aggregate principal amount equal to, and in exchange for, the unconverted
portion of the principal amount of such Security. A Security may be converted
in part, but only if the principal amount of such part is an integral multiple
of $1,000 and the principal amount of such Security to remain outstanding after
such conversion is equal to $1,000 or any integral multiple of $1,000 in excess
thereof.

 

Section 4.03                   Fractional Shares.

 

No fractional
shares of Common Stock shall be issued upon conversion of any Security or
Securities. If more than one Security shall be surrendered for conversion at
one time by the same Holder, the number of full shares which shall be issued
upon conversion thereof shall be computed on the basis of the aggregate
principal amount of the Securities (or specified portions thereof) so
surrendered. Instead of any fractional share of Common Stock which would
otherwise be issued upon conversion of any Security or Securities (or specified
portions thereof), the Company shall pay a cash adjustment in respect of such
fraction (calculated to the nearest one-100th of a share) in an amount equal to
the same fraction of the Closing Price of the Common Stock as of the Trading
Day preceding the date of conversion.

 

Section 4.04                   Taxes on Conversion.

 

Except as provided
in the next sentence, the Company will pay any and all taxes (other than taxes
on income) and duties that may be payable in respect of the issue or delivery
of shares of Common Stock on conversion of Securities pursuant hereto. A Holder
delivering a Security for conversion shall be liable for and will be required
to pay any tax or duty which may be payable in respect of any transfer involved
in the issue and delivery of shares of Common Stock in a name other than that
of the Holder of the Security or Securities to be converted, and no such issue
or delivery shall be made unless the Person requesting such issue has paid to
the Company the amount of any such tax or duty, or has established to the
satisfaction of the Company that such tax or duty has been paid.

 

Section 4.05                   [Reserved].

 

Section 4.06                   Company to Provide Common Stock.

 

(a)  The Company shall, prior to issuance of any
Securities hereunder, and from time to time as may be necessary, reserve, out
of its authorized but unissued Common Stock, a sufficient number of shares of
Common Stock to permit the conversion of all outstanding Securities into shares
of Common Stock.

 

(b)  All shares of Common Stock delivered upon
conversion of the Securities shall be newly issued shares, shall be duly
authorized, validly issued, fully paid and nonassessable and shall be free from
preemptive or similar rights and free of any lien or adverse claim as the
result of any action by the Company.

 

(c)  The Company will endeavor promptly to comply
with all federal and state securities laws regulating the offer and delivery of
shares of Common Stock upon conversion of Securities.

 

31

 

(d)  The Company will use its best efforts to
ensure that the shares of Common Stock to be issued upon conversion of the
Securities will be registered under the Securities Act of 1933, as amended. In
the event that despite the Company’s best efforts it is unable to deliver
shares that have been so registered, upon conversion of the Securities, the
Company may deliver shares of Common Stock that have not been registered.

 

Section 4.07                   Adjustment of Conversion Rate.

 

(a)  The Conversion Rate shall be adjusted from
time to time by the Company, without duplication, as follows:

 

(1) If the Company shall pay a dividend or make a distribution to
all holders of outstanding Common Stock in shares of Common Stock, the
Conversion Rate in effect immediately prior to the record date for the
determination of shareholders entitled to receive such dividend or other
distribution shall be increased so that the same shall equal the rate
determined by multiplying the Conversion Rate in effect immediately prior to
such record date by a fraction of which the numerator shall be the sum of the
number of shares of Common Stock outstanding at the close of business on such
record date plus the total number of shares of Common Stock constituting such
dividend or other distribution and of which the denominator shall be the number
of shares of Common Stock outstanding at the close of business on such record
date. Such adjustment shall be made successively whenever any such dividend or
distribution is made and shall become effective immediately after such record
date. For the purpose of this clause (1), the number of shares of Common Stock
at any time outstanding shall not include shares held in the treasury of the
Company. The Company will not pay any dividend or make any distribution on
Common Stock held in the treasury of the Company. If any dividend or
distribution of the type described in this clause is declared but not so paid
or made, the Conversion Rate shall again be adjusted to the Conversion Rate
that would then be in effect as if such dividend or distribution had not been
declared.

 

(2) If the Company shall subdivide its outstanding Common Stock
into a greater number of shares, or combine its outstanding Common Stock into a
smaller number of shares, the Conversion Rate in effect immediately prior to
the day upon which such subdivision or combination becomes effective shall be,
in the case of a subdivision of Common Stock, proportionately increased and, in
the case of a combination of Common Stock, proportionately reduced. Such
adjustment shall be made successively whenever any such subdivision or
combination of the Common Stock occurs and shall become effective immediately
after the date upon which such subdivision or combination becomes effective.

 

(3) If the Company shall issue any rights or warrants (other than
rights or warrants referred to in Section 4.07(a)(4)) to all or
substantially all holders of its outstanding Common Stock entitling them to
subscribe for or purchase shares of Common Stock (or securities convertible
into or exchangeable for Common Stock) at a price per share (or having a
Conversion Price per share) less than the Current Market Price per share of
Common Stock (as determined in accordance with clause (9) of this Section 4.07(a))
on the record date for the determination of shareholders entitled to receive
such rights or warrants, the Conversion Rate in effect immediately prior
thereto shall be increased so that the same shall equal the rate determined by
multiplying the Conversion Rate in effect at the opening of business on the
date 

 

32

 

immediately prior
to such record date by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding at the close of business on such record date
plus the number of additional shares of Common Stock so offered for
subscription or purchase (or into or for which the convertible or exchangeable
securities so offered are convertible or exchangeable) and of which the
denominator shall be the number of shares of Common Stock outstanding at the
close of business on such record date plus the number of shares which the
aggregate offering price of the total number of shares of Common Stock so offered
for subscription or purchase (or the aggregate conversion price of the
convertible or exchangeable securities so offered for subscription or purchase,
which shall be determined by multiplying the number of shares of Common Stock
issuable upon conversion or exchange of such convertible or exchangeable
securities by the conversion price per share of Common Stock pursuant to the
terms of such convertible or exchangeable securities) would purchase at the
Current Market Price per share of Common Stock on such record date. Such
adjustment shall be made successively whenever any such rights or warrants are
issued, and shall become effective immediately after such record date. To the
extent that shares of Common Stock (or securities convertible into or exchangeable
for Common Stock) are not delivered pursuant to such rights or warrants, upon
the expiration or termination of such rights or warrants, the Conversion Rate
shall be readjusted to the Conversion Rate 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 (or securities
convertible into or exchangeable for Common Stock) actually delivered. If such
rights or warrants are not so issued, the Conversion Rate shall again be
adjusted to be the Conversion Rate that would then be in effect if the record
date for the determination of shareholders entitled to receive such rights or
warrants had not been fixed. In determining whether any rights or warrants
entitle the shareholders to subscribe for or purchase shares of Common Stock at
a price less than the Current Market Price per share of Common Stock and in
determining the aggregate offering price of the total number of shares of
Common Stock so offered, there shall be taken into account any consideration
received by the Company for such rights or warrants and any amount payable on
exercise or conversion thereof, the value of such consideration, if other than
cash, to be determined by the Board of Directors.

 

(4) In case the Company shall, by dividend or otherwise,
distribute to all or substantially all holders of its Common Stock shares of
any class of Capital Stock of the Company (other than any dividends or
distributions to which Section 4.07(a)(1) applies) or evidences of
its indebtedness, cash or other assets, including securities, but excluding (x) any
rights or warrants referred to in Section 4.07(a)(3), (y) any stock,
securities or other property or assets (including cash) distributed in connection
with a reclassification, change, merger, consolidation, statutory share
exchange, combination, sale, conveyance or lease to which Section 4.11
hereof applies, and (z) dividends and distributions paid exclusively in
cash (the securities described in foregoing clauses (x), (y) and (z) hereinafter
in this Section 4.07(a)(4) called the “securities”), then, in each
such case, subject to the third succeeding paragraph of this Section 4.07(a)(4),
the Conversion Rate shall be increased so that the same shall be equal to the
rate determined by multiplying the Conversion Rate in effect immediately prior
to the close of business on the record date (as defined in Section 4.07(a)(9)(C))
with respect to such distribution by a fraction, the numerator of which shall
be the Current Market Price (determined as provided in Section 4.07(a)(9))
on such date, and the denominator of which shall be such Current Market Price
on such date less the fair market value (as determined by the Board of
Directors (except as described below), whose determination shall be conclusive
and set forth in a Board Resolution) on such date of the portion 

 

33

 

of the shares of
capital stock, evidences of indebtedness, cash or other assets, including
securities, so distributed applicable to one share of Common Stock (determined
on the basis of the number of shares of the Common Stock outstanding on the
record date).

 

Such increase shall become effective immediately prior to the opening
of business on the day following the record date, or in the case of a Spin-off
(as described below), immediately prior to the opening of business on the day
following the last Trading Day of the Measurement Period. However, in the event
that the then fair market value (as so determined) of the portion of the
securities so distributed applicable to one share of Common Stock is equal to
or greater than the Current Market Price on the record date, in lieu of the
foregoing adjustment, adequate provision shall be made so that each Holder
shall have the right to receive upon conversion of a Security (or any portion
thereof) the amount of shares of capital stock, evidences of indebtedness, cash
or other assets, including securities, such Holder would have received had such
Holder converted such Security (or portion thereof) immediately prior to such
record date. In the event that such dividend or distribution is not so paid or
made, the Conversion Rate shall again be adjusted to be the Conversion Rate
which would then be in effect as if such dividend or distribution had not been
declared.

 

If the Board of
Directors determines the fair market value of any distribution for purposes of
this Section 4.07(a)(4) by reference to the actual or when issued
trading market for any securities comprising all or part of such distribution,
it must in doing so consider the prices in such market over the same period
(the “Reference Period”)
used in computing the Current Market Price pursuant to Section 4.07(a)(9) to
the extent possible, unless the Board of Directors in a Board Resolution
determines in good faith that determining the fair market value during the
Reference Period would not be in the best interest of the Holder.

 

In the event the
Company distributes shares of capital stock of a Subsidiary or other business
unit of the Company, the Conversion Rate will be adjusted, if at all, so that
the same shall be equal to the rate determined by multiplying the Conversion
Rate in effect immediately prior to the close of business on the record date
(as defined in Section 4.07(a)(9)) with respect to such distribution by a
fraction, (i) the numerator of which shall be the Current Market Price
(determined as described below) on such date plus the fair market value on such
date of the portion of the shares of capital stock of such Subsidiary or other
business unit of the Company so distributed applicable to one share of Common
Stock (determined on the basis of the number of shares of the Common Stock
outstanding on the record date), and (ii) the denominator of which shall
be such Current Market Price on such date (determined as described below).

 

In respect of a
dividend or other distribution of shares of capital stock of a class or series,
or similar equity interest, of or relating to a Subsidiary or other business
unit of the Company which has a Subsidiary Closing Price (a “Spin-off”), the fair market value of
the securities to be distributed shall equal the average of the daily
Subsidiary Closing Price of such securities for the 10 consecutive Trading Days
commencing on and including the fifth Trading Day of such securities after the
effectiveness of the Spin-off (the “Measurement
Period”) and the Current Market Price shall be calculated over
the same Measurement Period; provided,
however, that in the event that an underwritten initial public
offering of the securities in the Spin-off occurs simultaneously with the
Spin-off, the fair market value of the securities distributed in the Spin-off
shall be the initial public offering price of such securities and the market
price per share of 

 

34

 

the Common Stock
shall mean the Closing Price for the Common Stock on the same Trading Day.

 

Rights or warrants
distributed by the Company to all holders of Common Stock entitling the holders
thereof to subscribe for or purchase shares of the Company’s capital stock
(either initially or under certain circumstances), which rights or warrants,
until the occurrence of a specified event or events (“Trigger Event”):

 

(i) are deemed
to be transferred with such shares of Common Stock,

 

(ii) are not
exercisable, and

 

(iii) are
also issued in respect of future issuances of Common Stock

 

shall
be deemed not to have been distributed for purposes of this Section 4.07(a)(4) (and
no adjustment to the Conversion Rate under this Section 4.07(a)(4) will
be required) until the occurrence of the earliest Trigger Event. If such right
or warrant is subject to subsequent events, upon the occurrence of which such
right or warrant shall become exercisable to purchase different securities,
evidences of indebtedness or other assets or entitle the holder to purchase a
different number or amount of the foregoing or to purchase any of the foregoing
at a different purchase price, then the occurrence of each such event shall be
deemed to be the date of issuance and record date with respect to a new right
or warrant (and a termination or expiration of the existing right or warrant
without exercise by the holder thereof). In addition, in the event of any distribution
(or deemed distribution) of rights or warrants, or any Trigger Event or other
event (of the type described in the preceding sentence) with respect thereto,
that resulted in an adjustment to the Conversion Rate under this Section 4.07(a)(4):

 

(A) in
the case of any such rights or warrants which shall all have been redeemed or
repurchased without exercise by any holders thereof, the Conversion Rate shall
be readjusted upon such final redemption or repurchase to give effect to such
distribution or Trigger Event, as the case may be, as though it were a cash
distribution, equal to the per share redemption or repurchase price received by
a holder of Common Stock with respect to such rights or 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

 

(B) in
the case of such rights or warrants all of which shall have expired or been
terminated without exercise, the Conversion Rate shall be readjusted as if such
rights and warrants had never been issued.

 

For purposes of
this Section 4.07(a)(4) and Sections 4.07(a)(1), 4.07(a)(2) and
4.07(a)(3), any dividend or distribution to which this Section 4.07(a)(4) is
applicable that also includes shares of Common Stock, a subdivision or
combination of Common Stock to which Section 4.07(a)(2) applies, or
rights or warrants to subscribe for or purchase shares of Common Stock to which
Section 4.07(a)(3) applies (or any combination thereof), shall be
deemed instead to be:

 

(A) a
dividend or distribution of the evidences of indebtedness, assets, shares of
capital stock, rights or warrants other than such shares of Common Stock, such 

 

35

 

subdivision or
combination or such rights or warrants to which Sections 4.07(a)(1), 4.07(a)2
and 4.07(a)(3) apply, respectively (and any Conversion Rate increase
required by this Section 4.07(a)(4) with respect to such dividend or
distribution shall then be made); immediately followed by

 

(B) a
dividend or distribution of such shares of Common Stock, such subdivision or
combination or such rights or warrants (and any further Conversion Rate
increase required by Sections 4.07(a)(1), 4.07(a)(2) and 4.07(a)(3) with
respect to such dividend or distribution shall then be made); except:

 

(i) the
record date of such dividend or distribution shall be substituted as (x) “the
date fixed for the determination of stockholders entitled to receive such
dividend or other distribution”, “record date fixed for such determination” and
“record date” within the meaning of Section 4.07(a)(1), (y) “the day
upon which such subdivision becomes effective” and “the day upon which such
combination becomes effective” within the meaning of Section 4.07(a)(2),
and (z) “the record date fixed for the determination of stockholders
entitled to receive such rights or warrants,” such “record date,” “the record
date fixed for the determination of stockholders entitled to receive such
rights or warrants” and “such date fixed for the determination of stockholders
entitled to receive such rights or warrants” within the meaning of Section 4.07(a)(3);
and

 

(ii) any
shares of Common Stock included in such dividend or distribution shall not be
deemed “outstanding at the close of business on the record date fixed for such
determination” within the meaning of Section 4.07(a)(1) and any
reduction or increase in the number of shares of Common Stock resulting from
such subdivision or combination shall be disregarded in connection with such
dividend or distribution.

 

(5) To the
extent the Company has a Rights Plan in effect upon conversion of the
Securities pursuant to this Article 4: (i) if such Rights have not
separated from the Common Stock prior to the conversion of the Securities, each
share of Common Stock issued upon conversion of the Securities pursuant to this
Article 4 shall be entitled to receive the appropriate number of Rights,
if any, and the certificates representing the Common Stock issued upon such
conversion shall bear such legends, if any, in each case as may be provided by
the terms of any Rights Plan; or (ii) if such Rights have separated from
the Common Stock prior to the conversion of the Securities, the Conversion Rate
will be adjusted as though the Rights were being distributed to all holders of
Common Stock on the date of such separation. If such an adjustment is made and
the Rights are later redeemed, invalidated or terminated, then a corresponding
reversing adjustment will be made to the Conversion Rate on an equitable basis.

 

(6) In case
the Company shall, by dividend or otherwise, distribute to all or substantially
all holders of its Common Stock cash (excluding any cash that is distributed
upon a reclassification, change, merger, consolidation, statutory share
exchange, combination, sale, conveyance or lease to which Section 4.11
hereof applies or as part of a distribution referred to in Section 4.07(a)(4) hereof),
then, and in each such case, immediately after the close of business on such
date, the Conversion Rate shall be increased so that the same shall equal the
rate 

 

36

 

determined by multiplying
the Conversion Rate in effect immediately prior to the close of business on
such record date by a fraction:

 

(i)        the numerator of which shall be equal to the Current
Market Price on the record date, and

 

(ii)       the denominator of which shall be equal to the Current
Market Price on such date less an amount equal to the quotient of (x) the
sum of the aggregate amount of cash so distributed, and (y) the number of
shares of Common Stock outstanding on the record date.

 

In the event that
such dividend or distribution is not so paid or made, the Conversion Rate shall
again be adjusted to be the Conversion Rate which would then be in effect as if
such dividend or distribution had not been declared.

 

(7) In case a
tender or exchange offer made by the Company or any of its subsidiaries for all
or any portion of the Common Stock shall expire, to the extent that the cash
and value of any other consideration included in the payment per share of
Common Stock in such offer exceeds Closing Price per share of Common Stock on
the day after the date of the last time (the “Expiration Time”) tenders could have been made pursuant to
such tender or exchange offer, the Conversion Rate shall be adjusted so that
the same shall equal the rate determined by multiplying the Conversion Rate in
effect immediately prior to close of business on the date of the Expiration
Time by a fraction:

 

(i)        the numerator of which shall be the sum of (x) the
fair market value (determined as set forth in Section 4.07(a)(9)) of the
aggregate consideration payable to stockholders based on the acceptance (up to
any maximum specified in the terms of the tender or exchange offer) of all shares
validly tendered or exchanged and not withdrawn as of the Expiration Time (the
shares deemed so accepted, up to any such maximum, being referred to as the “Purchased Shares”) and (y) the
product of the number of shares of Common Stock outstanding (less any Purchased
Shares) at the Expiration Time and the Current Market Price of the Common Stock
on the Trading Day next succeeding the Expiration Time, and

 

(ii)       the denominator shall be (x) the number of shares
of Common Stock outstanding (including any tendered or exchanged shares) at the
Expiration Time multiplied by (y) the Current Market Price of the Common
Stock on the Trading Day next succeeding the Expiration Time.

 

Such increase (if
any) shall become effective immediately prior to the opening of business on the
day following the Expiration Time. In the event that the Company is obligated
to purchase shares pursuant to any such tender offer, but the Company is
permanently prevented by applicable law from effecting any such purchases or
all such purchases are rescinded, the Conversion Rate shall again be adjusted
to be the Conversion Rate which would then be in effect as if such tender or
exchange offer had not been made. If the application of this Section 4.07(a)(7) to
any tender or exchange offer would result in a decrease in the Conversion Rate,
no adjustment shall be made for such tender or exchange offer under this Section 4.07(a)(7).

 

37

 

(8) [Reserved].

 

(9) For
purposes of this Section 4.07(a), the following terms shall have the
meanings indicated:

 

(A) “Current Market Price”
shall mean the average of the daily Closing Prices per share of Common Stock
for the 10 consecutive Trading Days immediately prior to the date in question; provided, however, that if:

 

(i) the
“ex” date (as hereinafter defined) for any event (other than the issuance or
distribution requiring such computation) that requires an adjustment to the
Conversion Rate pursuant to Section 4.07(a)(1), (2), (3), (4), (6) or
(7) occurs during such 10 consecutive Trading Days, the Closing Price for
each Trading Day prior to the “ex” date for such other event shall be adjusted
by dividing such Closing Price by the same fraction by which the Conversion
Rate is so required to be adjusted as a result of such other event;

 

(ii) the
“ex” date for any event (other than the issuance or distribution requiring such
computation) that requires an adjustment to the Conversion Rate pursuant to Section 4.07(a)(1),
(2), (3), (4), (6) or (7) occurs on or after the “ex” date for the
issuance or distribution requiring such computation and prior to the day in
question, the Closing Price for each Trading Day on and after the “ex” date for
such other event shall be adjusted by dividing such Closing Price by the reciprocal
of the fraction by which the Conversion Rate is so required to be adjusted as a
result of such other event; and

 

(iii) the
“ex” date for the issuance or distribution requiring such computation is prior
to the day in question, after taking into account any adjustment required
pursuant to clause (i) or (ii) of this proviso, the Closing Price for
each Trading Day on or after such “ex” date shall be adjusted by adding thereto
the amount of any cash and the fair market value (as determined by the Board of
Directors in a manner consistent with any determination of such value for
purposes of Section 4.07(a)(4) or (7), whose determination shall be
conclusive and set forth in a Board Resolution) of the evidences of
indebtedness, shares of capital stock or assets being distributed applicable to
one share of Common Stock as of the close of business on the day before such “ex”
date.

 

For purposes of
any computation under Section 4.07(a)(7), the Current Market Price of the
Common Stock on any date shall be deemed to be the average of the daily Closing
Prices per share of Common Stock for such day and the next two succeeding
Trading Days; provided, however,
that if the “ex” date for any event (other than the tender offer requiring such
computation) that requires an adjustment to the Conversion Rate pursuant to Section 4.07(a)(1),
(2), (3), (4), (6) or (7) occurs on or after the Expiration Time for
the tender or exchange offer requiring such computation and prior to the day in
question, the Closing Price for each Trading Day on and after the “ex” date for
such other event shall be adjusted by dividing such Closing Price by the
reciprocal of the fraction by which the Conversion Rate is so required to be
adjusted as a result of such other event. For purposes of this paragraph, the
term “ex” date, when used:

 

(x) with respect to any issuance or distribution, means the first
date on which the Common Stock trades regular way on the relevant exchange or
in the relevant market

 

38

 

from which the Closing Price was obtained without the
right to receive such issuance or distribution;

 

(y) with respect to any subdivision or combination of shares of
Common Stock, means the first date on which the Common Stock trades regular way
on such exchange or in such market after the time at which such subdivision or
combination becomes effective; and

 

(z) with respect to any tender or exchange offer, means the first
date on which the Common Stock trades regular way on such exchange or in such
market after the Expiration Time of such offer.

 

Notwithstanding the foregoing, whenever successive adjustments to the
Conversion Rate are called for pursuant to this Section 4.07(a), such
adjustments shall be made to the Current Market Price as may be necessary or
appropriate to effectuate the intent of this Section 4.07(a) and to
avoid unjust or inequitable results as determined in good faith by the Board of
Directors.

 

(B) “fair market value” shall mean the amount which a willing
buyer would pay a willing seller in an arm’s length transaction.

 

(C) For purposes of this Section 4.07, “record date” shall mean, with respect
to any dividend, distribution or other transaction or event in which the
holders of Common Stock have the right to receive any cash, securities or other
property or in which the Common Stock (or other applicable security) is
exchanged or converted into any combination of cash, securities or other
property, the date fixed for determination of shareholders entitled to receive
such cash, security or other property (whether or not such date is fixed by the
Board of Directors or by statute, contract or otherwise).

 

(b)  In any case in which this Section 4.07
shall require that an adjustment be made following a record date or Expiration
Time, as the case may be, established for the purposes specified in this Section 4.07,
the Company may elect to defer (but only until five Business Days following the
filing by the Company with the Trustee of the certificate described in Section 4.09)
issuing to the Holder of any Security converted after such record date or
Expiration Time the shares of Common Stock and other Capital Stock of the
Company issuable upon such conversion over and above the shares of Common Stock
and other Capital Stock of the Company (or other cash, property or securities,
as applicable) issuable upon such conversion only on the basis of the
Conversion Rate prior to adjustment; and, in lieu of any cash, property or
securities the issuance of which is so deferred, the Company shall issue or cause
its transfer agents to issue due bills or other appropriate evidence prepared
by the Company of the right to receive such cash, property or securities. If
any distribution in respect of which an adjustment to the Conversion Rate is
required to be made as of the record date or Expiration Time therefore is not
thereafter made or paid by the Company for any reason, the Conversion Rate
shall be readjusted to the Conversion Rate which would then be in effect if
such record date had not been fixed or such record date or Expiration Time had
not occurred.

 

(c)  If one or more events occur requiring an
adjustment be made to the Conversion Rate for a particular period, adjustments
to the Conversion Rate shall be determined by the 

 

39

 

Company’s
Board of Directors to reflect the combined impact of such Conversion Rate
adjustment events, as set out in this Section 4.07, during such period.

 

(d) In no event shall the total number of shares
of Common Stock issuable upon conversion of a Security exceed 58.3430 shares
per $1,000 principal amount of Securities, other than adjustments to Conversion
Rate as set forth in clauses (1) through (7) of Section 4.07(a).

 

Section 4.08                   No Adjustment.

 

(a)  No adjustment in the Conversion Rate shall
be required if Holders may participate in the transactions set forth in Section 4.07
above (to the same extent as if the Securities had been converted into Common
Stock immediately prior to such transactions) without converting the Securities
held by such Holders.

 

(b)  No adjustment in the Conversion Rate shall
be required unless such adjustment would require an increase or decrease of at
least 1% in the Conversion Rate as last adjusted; provided, however,
that any adjustments which would be required to be made but for this Section 4.08(b) shall
be carried forward and taken into account in any subsequent adjustment; provided, further,
that any carry forward amount shall be paid to a Holder of Securities upon
conversion of such Securities, regardless of the 1% threshold. All calculations
under this Article 4 shall be made to the nearest cent or to the nearest
one-ten thousandth of a share, as the case may be, with one half cent and
0.00005 of a share, respectively, being rounded upward.

 

(c)  No adjustment in the Conversion Rate shall
be required for issuances of Common Stock pursuant to a Company plan for
reinvestment of dividends or interest or for a change in the par value or a
change to no par value of the Common Stock.

 

(d)  To the extent that the Securities become
convertible into the right to receive cash, no adjustment need be made
thereafter as to the cash.

 

(e)  No adjustment in the Conversion Rate shall
be required with respect to accrued and unpaid interest, including Special
Interest, on the Securities.

 

Section 4.09                   Notice of Adjustment.

 

Whenever the Conversion Rate or conversion privilege is required to be
adjusted pursuant to this Indenture, the Company shall promptly mail to Holders
a notice of the adjustment and file with the Trustee an Officers’ Certificate
briefly stating the facts requiring the adjustment, the adjusted Conversion
Rate and the manner of computing it. Failure to mail such notice or any defect
therein shall not affect the validity of any such adjustment. Unless and until
the Trustee shall receive an Officers’ Certificate setting forth an adjustment
of the Conversion Rate, the Trustee may assume without inquiry that the
Conversion Rate has not been adjusted and that the last Conversion Rate of
which it has knowledge remains in effect.

 

Section 4.10                   Notice of Certain Transactions.

 

In the event that there is a dissolution or liquidation of the Company,
the Company shall mail to Holders and file with the Trustee a notice stating
the proposed effective date. The 

 

40

 

Company shall mail such notice at least 20 days before such proposed
effective date. Failure to mail such notice or any defect therein shall not
affect the validity of any transaction referred to in this Section 4.10.

 

Section 4.11                   Effect of Reclassification, Consolidation, Merger or
Sale on Conversion Privilege.

 

If any of the following events occur:

 

(i) any recapitalization, reclassification or change of the
outstanding shares of Common Stock (other than a change in par value, or from
par value to no par value, or from no par value to par value, or as a result of
a subdivision or combination);

 

(ii) any merger, consolidation, statutory share exchange or
combination of the Company with another corporation as a result of which
holders of Common Stock shall be entitled to receive stock, securities or other
property or assets (including cash) with respect to or in exchange for such
Common Stock;

 

(iii) any sale, conveyance or lease of the properties and assets
of the Company as, or substantially as, an entirety to any other corporation;
or

 

(iv) any statutory share exchange,

 

in each case, as a result of which holders of Common
Stock shall be entitled to receive stock, securities or other property or
assets (including cash) with respect to or in exchange for such Common Stock,
the Company or the successor or purchasing corporation, as the case may be,
shall execute with the Trustee a supplemental indenture (which shall comply
with the TIA as in force at the date of execution of such supplemental
indenture if such supplemental indenture is then required to so comply)
providing that each Security shall be convertible into the kind and amount of
shares of stock and other securities or property or assets (including cash)
which such Holder would have been entitled to receive upon such
recapitalization, reclassification, change, merger, consolidation, statutory
share exchange, combination, sale, conveyance or lease. In the event holders of
the Common Stock have the opportunity to elect the form of consideration to be
received in such business combination, the Securities will be convertible into
the weighted average of the kind and amount of consideration received by the
holders of the Common Stock that affirmatively make such an election. The
Company may not become a party to any such transaction unless its terms are
consistent with the preceding. None of the foregoing provisions shall affect
the right of a Holder of Securities to convert its Securities into shares of the
Common Stock prior to the effective date of the business combination.

 

Such supplemental indenture shall provide for adjustments which shall
be as nearly equivalent as may be practicable to the adjustments provided for
in this Article 4. If, in the case of any such recapitalization,
reclassification, change, merger, consolidation, statutory share exchange,
combination, sale, conveyance or lease, the stock or other securities and
assets receivable thereupon by a holder of shares of Common Stock includes shares
of stock or other securities and assets of a corporation other than the
successor or purchasing corporation, as the case may be, in such
recapitalization, reclassification, change, merger, consolidation, statutory
share exchange, combination, sale or conveyance, then such supplemental
indenture shall also be 

 

41

 

executed by such other corporation and shall contain such additional
provisions to protect the interests of the Holders of the Securities as the
Board of Directors shall reasonably consider necessary by reason of the
foregoing, including to the extent practicable the provisions providing for the
repurchase rights set forth in Article 3 hereof.

 

In the event the Company shall execute a supplemental indenture
pursuant to this Section 4.11, the Company shall promptly file with the
Trustee an Officers’ Certificate briefly stating the reasons therefor, the kind
or amount of shares of stock or other securities or property (including cash)
that a holder of shares of Common Stock equal to the Conversion Rate
immediately prior to such transaction would have owned or been entitled to
receive after any such transaction, and any adjustment to be made with respect
thereto. 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 Securities, within 20 days after execution
thereof. Failure to deliver such notice shall not affect the legality or validity
of such supplemental indenture.

 

The above provisions of this Section shall similarly apply to
successive recapitalizations, reclassifications, mergers, consolidations,
statutory share exchanges, combinations, sales and conveyances.

 

If this Section 4.11 applies to any event or occurrence, Section 4.07(a) hereof
shall not apply.

 

Section 4.12                   Trustee’s Disclaimer.

 

(a)  The Trustee shall have no duty to determine
when an adjustment under this Article 4 should be made, how it should be
made or what such adjustment should be, but may accept as conclusive evidence
of that fact or the correctness of any such adjustment, and shall be protected
in relying upon, an Officers’ Certificate and Opinion of Counsel, including the
Officers’ Certificate with respect thereto which the Company is obligated to
file with the Trustee pursuant to Section 4.09. Unless and until the
Trustee receives such Officers’ Certificate delivered pursuant to Section 4.09,
the Trustee may assume without inquiry that no such adjustment has been made
and the last Conversion Rate of which the Trustee has knowledge remains in
effect. The Trustee makes no representation as to the validity or value of any
securities or assets issued upon conversion of Securities, and the Trustee
shall not be responsible for the Company’s failure to comply with any
provisions of this Article 4.

 

(b)  The Trustee shall not be under any
responsibility to determine the correctness of any provisions contained in any
supplemental indenture executed pursuant to Section 4.11, but may accept
as conclusive evidence of the correctness thereof, and shall be fully protected
in relying upon, the Officers’ Certificate and Opinion of Counsel with respect
thereto which the Company is obligated to file with the Trustee pursuant to Section 4.11
and Section 9.01, respectively.

 

Section 4.13                   Voluntary Increase.

 

The Company from time to time may increase the Conversion Rate, to the
extent permitted by law, by any amount for any period of time if the period is
at least 20 days, the increase is irrevocable during the period and the Board
of Directors determines that such increase 

 

42

 

would be in the best interests of the Company or to avoid or diminish
income tax to holders of shares of Common Stock in connection with a dividend
or distribution of stock, or rights to acquire stock, or similar event, and the
Company provides 15 days’ prior written notice of any increase in the
Conversion Rate to the Trustee and the Holders; provided, however,
that in no event may the Company increase the Conversion Rate such that it
causes the Conversion Price to be less than the par value of a share of Common
Stock.

 

Article 5

Subordination

 

Section 5.01                   Securities Subordinated to Senior Debt.

 

The Company covenants and agrees, and each Holder of Securities, by
such Holder’s acceptance thereof, likewise covenants and agrees, that the
Indebtedness represented by the Securities and the payment of the principal of
and premium, if any, and interest, including Special Interest, if any, on each
and all of the Securities is hereby expressly subordinated and junior, to the
extent and in the manner set forth in this Section 5.01, in right of
payment to the prior payment in full of all Senior Debt; provided, however,
that the Securities, the Indebtedness represented thereby and the payment of
the principal of and premium, if any, and interest, including Special Interest,
if any, on the Securities in all respects shall rank equally with, or prior to,
all existing and future Indebtedness of the Company that is expressly
subordinated to any Senior Debt.

 

(a)  In the event of any payment or distribution
of assets of the Company upon any dissolution, winding-up, liquidation or
reorganization of the Company, whether in bankruptcy, insolvency,
reorganization or receivership proceedings or upon an assignment for the
benefit of creditors or any other marshalling of the assets and liabilities of
the Company or otherwise, the holders of all Senior Debt shall first be
entitled to receive payment of the full amount due thereon in respect of all
such Senior Debt and all other amounts due or provision shall be made for such
amount in cash, or other payments satisfactory to the holders of Senior Debt,
before the Holders of any of the Securities are entitled to receive any payment
or distribution of any character, whether in cash, securities or other
property, on account of the principal of or premium, if any, or interest,
including Special Interest, if any, on the Securities.

 

(b)  In the event of any acceleration of Maturity
of the Securities because of an Event of Default, unless the full amount due in
respect of all Senior Debt is paid in cash or other form of payment
satisfactory to the holders of Senior Debt, no payment shall be made by the
Company with respect to the principal of, premium, if any, or interest,
including Special Interest, if any, on the Securities or to acquire any of the
Securities (including any conversion, redemption or cash repurchase pursuant to
the exercise of the Fundamental Change Repurchase Right or otherwise), and the
Company shall give prompt written notice of such acceleration to such holders
of Senior Debt.

 

(c)  In the event of and during the continuance
of any default in payment of the principal of or premium, if any, or interest
on, rent or other payment obligations in respect of, any Senior Debt, unless
all such payments due in respect of such Senior Debt have been paid in full in
cash or other payments satisfactory to the holders of Senior Debt, no payment
shall be made by the 

 

43

 

Company
with respect to the principal of, premium, if any, or interest, including
Special Interest, if any, on the Securities or to acquire any of the Securities
(including any conversion, redemption, or cash repurchase pursuant to the
exercise of the Fundamental Change Repurchase Right). The Company shall give
prompt written notice to the Trustee of any default under any Senior Debt or
under any agreement pursuant to which Senior Debt may have been issued.

 

(d)  In the event that, notwithstanding the
foregoing provisions of Sections 5.01(a), 5.01(b) and 5.01(c), any payment
on account of principal, premium, if any, or interest, including Special
Interest, if any, on the Securities shall be made by or on behalf of the
Company and received by the Trustee, by any Holder or by any Paying Agent (or,
if the Company is acting as its own Paying Agent, money for any such payment
shall be segregated and held in trust):

 

(1) after the occurrence of an event specified in Section 5.01(a) or
5.01(b), then, unless all Senior Debt is paid in full in cash, or provision
shall be made therefor; or

 

(2) after the happening of an event of default of the type
specified in Section 5.01(c) above, then, unless the amount of such
Senior Debt then due shall have been paid in full, or provision made therefor
or such event of default shall have been cured or waived, such payment
(subject, in each case, to the provisions of Section 5.07 hereof) shall be
held in trust for the benefit of, and shall be immediately paid over to, the
holders of Senior Debt or their representative or representatives or the
trustee or trustees under any indenture under which any instruments evidencing
any of the Senior Debt may have been issued, as their interests may appear.

 

Section 5.02                   Subrogation.

 

Subject to the payment in full of all Senior Debt to which the
Indebtedness evidenced by the Securities is in the circumstances subordinated
as provided in Section 5.01 hereof, the Holders of the Securities shall be
subrogated to the rights of the holders of such Senior Debt to receive payments
or distributions of cash, property or securities of the Company applicable to
such Senior Debt until all amounts owing on the Securities shall be paid in
full, and, as between the Company, its creditors other than holders of such
Senior Debt, and the Holders of the Securities, no such payment or distribution
made to the holders of Senior Debt by virtue of this Article which
otherwise would have been made to the holders of the Securities shall be deemed
to be a payment by the Company on account of such Senior Debt; provided, however, that the provisions of
this Article are and are intended solely for the purpose of defining the
relative rights of the Holders of the Securities, on the one hand, and the
holders of Senior Debt, on the other hand.

 

Section 5.03                   Obligation of the Company Is Absolute and
Unconditional.

 

Nothing contained in this Article or elsewhere in the Indenture or
in the Securities is intended to or shall impair, as between the Company, its
creditors other than the holders of Senior Debt, and the Holders of the
Securities, the obligation of the Company, which is absolute and unconditional,
to pay to the Holders of the Securities the principal of and premium, if any,
and interest, including Special Interest, if any, on the Securities as and when
the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the 

 

44

 

relative rights of the Holders of the Securities and creditors of the
Company other than the holders of Senior Debt, nor shall anything contained
herein or therein prevent the Trustee or the Holder of any Security from
exercising all remedies otherwise permitted by applicable law upon default
under the Indenture, subject to the rights, if any, under this Article of
the holders of Senior Debt in respect of cash, property or securities of the
Company received upon the exercise of any such remedy.

 

Section 5.04                   Maturity of or Default on Senior Debt.

 

Upon the maturity of any Senior Debt by lapse of time, acceleration or
otherwise, all principal of or premium, if any, or interest on, rent or other
payment obligations in respect of all such matured Senior Debt shall first be
paid in full, or such payment shall have been duly provided for, before any
payment on account of principal, or premium, if any, or interest, including
Special Interest, if any, is made upon the Securities.

 

Section 5.05                   Payments on Securities Permitted.

 

Except as expressly provided in this Article, nothing contained in this
Article shall affect the obligation of the Company to make, or prevent the
Company from making, payments of the principal of, or premium, if any, or
interest, including Special Interest, if any, on the Securities in accordance
with the provisions hereof and thereof, or shall prevent the Trustee or any
Paying Agent from applying any moneys deposited with it hereunder to the
payment of the principal of, or premium, if any, or interest, including Special
Interest, if any, on the Securities.

 

Section 5.06                   Effectuation of Subordination by Trustee.

 

Each Holder of Securities, by such Holder’s acceptance thereof,
authorizes and directs the Trustee on such Holder’s behalf to take such action
as may be necessary or appropriate to effectuate the subordination provided in
this Article and appoints the Trustee such Holder’s attorney-in-fact for
any and all such purposes. Upon any payment or distribution of assets of the
Company referred to in this Article, the Trustee and the Holders of the
Securities shall be entitled to rely upon any order or decree made by any court
of competent jurisdiction in which any such dissolution, winding-up,
liquidation or reorganization proceeding affecting the affairs of the Company
is pending or upon a certificate of the trustee in bankruptcy, receiver,
assignee for the benefit of creditors, liquidating trustee or agent or other
Person making any payment or distribution, delivered to the Trustee or to the
Holders of the Securities, for the purpose of ascertaining the Persons entitled
to participate in such payment or distribution, and as to other facts pertinent
to the right of such Persons under this Article, and, if such evidence is not
furnished, the Trustee may defer any payment to such Persons pending judicial
determination as to the right of such Persons to receive such payment.

 

Section 5.07                   Knowledge of Trustee.

 

Notwithstanding the provisions of this Article or any other
provisions of this Indenture, the Trustee shall not be charged with knowledge
of the existence of any facts that would prohibit the making of any payment or
distribution by the Trustee, and the Trustee and Paying Agent may continue to
make payments on the Securities, unless a Responsible Officer of the Trustee
having responsibility for the administration of the trust established by the
Indenture shall have received 

 

45

 

written notice thereof from the Company expressly directing the Trustee
that such payment cannot be made and, prior to the receipt of any such written
notice, the Trustee shall be entitled in all respects to assume that no such
default or facts exist; provided,
however, that unless on the third
Business Day prior to the date upon which by the terms hereof any such moneys
may become payable for any purpose the Trustee shall have received the notice
provided for in this Section 5.07, then, anything herein contained to the
contrary notwithstanding, the Trustee shall have full power and authority to
receive such moneys and apply the same to the purpose for which they were
received, and shall not be affected by any notice to the contrary which may be
received by it on or after such date.

 

Section 5.08                   Trustee’s Relation to Senior Debt.

 

The Trustee shall be entitled to all the rights set forth in this Article with
respect to any Senior Debt at the time held by it, to the same extent as any
other holder of Senior Debt and nothing in the Indenture shall deprive the
Trustee of any of its rights as such holder. Nothing contained in this Article shall
apply to claims of or payments to the Trustee under or pursuant to Section 9.08
of this Indenture. With respect to the holders of Senior Debt, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article (which covenant and
obligation is limited solely to withhold payment to the Holders if the Trustee
has actually received the written notice from the Company described in Section 5.07
above to the effect that a payment should not be made to the Holders), and no
implied covenants or obligations with respect to the holders of Senior Debt
shall be read into the Indenture against the Trustee. The Trustee shall not be
deemed to owe any duties (including, without limitation, any fiduciary duty) to
the holders of Senior Debt and the Trustee shall not be liable to any holder of
Senior Debt if it shall pay over or deliver to Holders, the Company or any
other Person moneys or assets to which any holder of Senior Debt shall be
entitled by virtue of this Article or otherwise.

 

Section 5.09                   Rights of Holders of Senior Debt Not Impaired.

 

No right of any present or future holder of any Senior Debt to enforce
the subordination herein shall at any time or in any way be prejudiced or
impaired by any act or failure to act on the part of the Company or by any
noncompliance by the Company with the terms, provisions and covenants of the
Indenture, regardless of any knowledge thereof any such holder may have or be
otherwise charged with.

 

Section 5.10                   Modification of Terms of Senior Debt.

 

Any renewal or extension of the time of payment of any Senior Debt or
the exercise by the holders of Senior Debt of any of their rights under any
instrument creating or evidencing Senior Debt, including, without limitation,
the waiver of default thereunder, may be made or done all without notice to or
assent from the Holders of the Securities or the Trustee. No compromise,
alteration, amendment, modification, extension, renewal or other change of, or
waiver, consent or other action in respect of, any liability or obligation
under or in respect of, or of any of the terms, covenants or conditions of any
indenture or other instrument under which any Senior Debt is outstanding or of
such Senior Debt, whether or not such compromise, alteration, amendment,
modification, extension, renewal or other change of, or waiver, consent 

 

46

 

or other action is in accordance with the provisions or any applicable
document, shall in any way alter or affect any of the provisions of this Article or
of the Securities relating to the subordination thereof.

 

Section 5.11                   Certain Conversions Not Deemed Payment.

 

For the purposes of this Article 5 only:

 

(a) the issuance and delivery of junior securities upon conversion
of Securities in accordance with Article 4 hereof shall not be deemed to
constitute a payment or distribution on account of the principal of, premium,
if any, or interest, including Special Interest, if any, on Securities or on
account of the purchase or other acquisition of Securities; and

 

(b) the payment, issuance or delivery of cash (except in
satisfaction of fractional shares pursuant to Section 4.03 hereof),
property or securities (other than junior securities) upon conversion of a
Security shall be deemed to constitute payment on account of the principal,
premium, if any, or interest, including Special Interest, if any, of such
Security. For the purposes of this Section 5.11, the term “junior
securities” means:

 

(1)   shares of any Company Common Stock; or

 

(2)   other securities of the Company that are subordinated
in right of payment to all Senior Debt that may be outstanding at the time of
issuance or delivery of such securities to substantially the same extent as, or
to a greater extent than, the Securities are so subordinated as provided in
this Article. Nothing contained in this Article 5 or elsewhere in the
Indenture or in the Securities is intended to or shall impair, as among the
Company, its creditors (other than holders of Senior Debt) and the Holders of
Securities, the right, which is absolute and unconditional, of the Holder of
any Security to convert such Security in accordance with Article 4 hereof.

 

Section 5.12                   No Layering of Debt.  The Company
will not incur, create, issue, assume, guarantee or otherwise become liable for
any Indebtedness that is contractually subordinate or junior in right of
payment to any Senior Debt of the Company and senior in right of payment to the
Securities.

 

Article 6

Covenants

 

Section 6.01                   Payment of Securities.

 

(a)  The Company shall promptly make all payments
in respect of the Securities on the dates and in the manner provided in the
Securities and this Indenture. A payment of principal or interest, including
Special Interest, if any, shall be considered paid on the date it is due if the
Paying Agent (other than the Company) holds by 10:00 a.m., New York City
time, on that date

 

47

 

money,
deposited by or on behalf of the Company, sufficient to make the payment.
Subject to Section 4.02 and Section 3.11, accrued and unpaid
interest, including Special Interest, if any, on any Security that is payable,
and is punctually paid or duly provided for, on any Interest Payment Date shall
be paid to the Person in whose name that Security is registered at the close of
business on the Regular Record Date for such interest at the office or agency
of the Company maintained for such purpose. Principal, Redemption Price,
Fundamental Change Repurchase Price, interest and Special Interest, in each
case if payable, shall be considered paid on the applicable date due if on such
date (or, in the case of Fundamental Change Repurchase Price, on the Business
Day following the applicable Fundamental Change Repurchase Date) the Trustee or
the Paying Agent holds, in accordance with this Indenture, money sufficient to
pay all such amounts then due. The Company shall, to the fullest extent
permitted by law, pay interest in immediately available funds on overdue
principal amount and interest, including Special Interest, if any, at the
annual rate borne by the Securities compounded semi-annually, which interest
shall accrue from the date such overdue amount was originally due to the date
payment of such amount, including interest thereon, has been made or duly
provided for. All such interest shall be payable on demand.

 

(b)  Payment of the principal of and interest,
including Special Interest, if any, on the Securities shall be made at the
office or agency of the Company maintained for that purpose, which shall
initially be at the Drop Agent’s Office, in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts; provided,
however, that the Company may pay
principal, interest and Special Interest, in respect of any Certificated
Security by check or wire transfer payable in such money; provided, further, that at the option of
the Company payment of interest and Special Interest may be made by check
mailed to the address of the Person entitled thereto as such address appears in
the register of the Securities; provided,
further, that a Holder with an aggregate principal amount in excess
of $5,000,000 will be paid by wire transfer in immediately available funds at
the election of such Holder if such Holder has provided wire transfer
instructions to the Trustee at least 10 Business Days prior to the payment
date. Any wire transfer instructions received by the Trustee will remain in
effect until revoked by the Holder. Notwithstanding the foregoing, so long as
the Securities are registered in the name of a Depositary or its nominee, all
payments thereon shall be made by wire transfer of immediately available funds
to the account of the Depositary or its nominee.

 

Section 6.02                   Corporate Existence.

 

Subject to Article 7 hereof, the Company will do or cause to be
done all things necessary to preserve and keep in full force and effect its
corporate existence, rights (charter and statutory) and franchises; provided, however,
that the Company shall not be required to preserve any such right or franchise
if the Company determines that the preservation thereof is no longer desirable
in the conduct of the business of the Company and that the loss thereof is not
disadvantageous in any material respect to the Holders.

 

Section 6.03                   Maintenance of Properties.

 

The Company will maintain and keep its properties and every part
thereof in such repair, working order and condition, and make or cause to be
made all such needful and proper repairs, renewals and replacements thereof, as
in the judgment of the Company are necessary in the

 

48

 

interests of the Company; provided, however,
that nothing contained in this Section shall prevent the Company from
selling, abandoning or otherwise disposing of any of its properties or
discontinuing a part of its business from time to time if, in the judgment of
the Company, such sale, abandonment, disposition or discontinuance is advisable
and does not materially adversely affect the interests or business of the
Company.

 

Section 6.04                   Payment of Taxes and Other Claims.

 

The Company will, and will cause any Significant Subsidiary to,
promptly pay and discharge or cause to be paid and discharged all material
taxes, assessments and governmental charges or levies lawfully imposed upon it
or upon its income or profits or upon any of its property, real or personal, or
upon any part thereof, as well as all material claims for labor, materials and
supplies which, if unpaid, might by law become a lien or charge upon its
property; provided, however, that neither the Company nor any
Significant Subsidiary shall be required to pay or discharge or cause to be
paid or discharged any such tax, assessment, charge, levy or claim if the
amount, applicability or validity thereof shall currently be contested in good
faith by appropriate proceedings and if the Company or such Significant
Subsidiary, as the case may be, shall have set aside on its books reserves
deemed by it adequate with respect thereto.

 

Section 6.05                   Reports.

 

The Company shall timely file all reports and other information and
documents which it is required to file with the SEC pursuant to Section 13
or 15(d) of the Exchange Act, and, within 15 days after it is required to
file them with the SEC, the Company shall file copies of all such reports,
information and other documents with the Trustee; provided that any such reports, information and documents
filed with the SEC pursuant to its Electronic Data Gathering, Analysis and
Retrieval (or EDGAR) system shall be deemed to be filed with the Trustee. The
Company shall inform the Trustee by electronic mail or other written means that
it has filed with the SEC an annual report on Form 10-K or quarterly
report on Form 10-Q. The Company also shall at all times comply with the
provisions of Section 314(a) of the TIA. In the event the Company is
no longer subject to the reporting requirements of Section 13 or 15(d) of
the Exchange Act, the Company shall, if required to do so under rules and
regulations prescribed by the SEC, provide the trustee with such reports
containing such information as would have been required to be filed with the
SEC had we continued to have been subject to such reporting requirements, as
may be prescribed in such rules and regulations. Delivery of such reports,
information and documents to the Trustee is for informational purposes only and
the Trustee’s receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including the Company’s compliance with any of its covenants hereunder
(as to which the Trustee is entitled to rely exclusively on Officers’
Certificates).

 

Section 6.06                   Compliance Certificate.

 

The Company shall deliver to the Trustee, within 90 days after the end
of each fiscal year of the Company, an Officers’ Certificate stating whether or
not to the knowledge of the signer thereof the Company is in default in the
performance and observance of any of the terms, provisions and conditions of
this Indenture (without regard to any period of grace or requirement 

 

49

 

of notice provided hereunder) and, if the Company
shall be in Default, specifying all such Defaults and the nature and the status
thereof of which the signer may have knowledge. Within five Business Days of an
Officer of the Company coming to have actual knowledge of a Default, regardless
of the date, the Company shall deliver an Officers’ Certificate to the Trustee
specifying such Default and the nature and status thereof.

 

Article 7

Consolidation; Merger; Conveyance; Transfer or Lease

 

Section 7.01                   Company May Consolidate, Etc., Only on Certain
Terms.

 

(a)  The Company may not, without the consent of
the Holders, consolidate with, merge into or convey, transfer or lease all or
substantially all of the property and assets of the Company and its Subsidiaries,
taken as a whole, to another Person unless:

 

(1) either (A) the Company shall be the resulting or
surviving corporation, or (B) the Person (if other than the Company)
formed by such consolidation or into which the Company is merged, or the Person
which acquires by transfer or lease all or substantially all of the properties
and assets of the Company, shall (i) be a corporation incorporated and
existing under the laws of the United States of America or any State thereof or
the District of Columbia, and (ii) expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the obligations of the Company under the
Securities, this Indenture and the performance or observance of every covenant
and provision of this Indenture and the Securities required on the part of the
Company to be performed or observed and the conversion rights shall be provided
for in accordance with Article 4, by supplemental indenture satisfactory
in form to the Trustee, executed and delivered to the Trustee, by the Person
(if other than the Company) formed by such consolidation or into which the
Company shall have been merged or by the Person which shall have acquired the
Company’s assets;

 

(2) after giving effect to such transaction, no Event of Default,
and no event which, after notice or lapse of time or both, would become an
Event of Default, shall have occurred and be continuing;

 

(3) if, as a result of such transaction, the Securities became
convertible into Common Stock or other securities issued by a third party, such
third party agrees to deliver such common stock or other securities upon
conversion under the Securities and the Indenture; and

 

(4) if the Company will not be the resulting or surviving corporation,
the Company shall have, at or prior to the effective date of such
consolidation, merger or transfer, delivered to the Trustee an Officers’
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger or transfer complies with this Article and, if a supplemental
indenture is required in connection with such transaction, such supplemental
indenture complies with this Article, and that all conditions precedent herein
provided for relating to such transaction have been complied with.

 

50

 

(b)  For purposes of the foregoing, the transfer
(by lease, assignment, sale or otherwise) of the properties and assets of one
or more Subsidiaries of the Company (other than to the Company or another Subsidiary
of the Company), which, if such assets were owned by the Company, would
constitute all or substantially all of the properties and assets of the Company
and its Subsidiaries, taken as a whole, shall be deemed to be the transfer of
all or substantially all of the properties and assets of the Company.

 

Section 7.02                   Successor Substituted.

 

Upon any consolidation of the Company with, or merger of the Company
into, any other Person or any conveyance, transfer or lease of all or
substantially all of the properties and assets of the Company and its
Subsidiaries, taken as a whole, in accordance with Section 7.01, the
successor Person formed by such consolidation or into which the Company is
merged or to which such conveyance, transfer or lease is made shall succeed to,
and be substituted for, and may exercise every right and power of, the Company
under this Indenture with the same effect as if such successor Person had been
named as the Company herein, and thereafter, except in the case of a lease, and
except for obligations the predecessor Person may have under a supplemental
indenture, the predecessor Person shall be relieved of all obligations and
covenants under the Indenture and the Securities.

 

Article 8

Default and Remedies

 

Section 8.01                   Events of Default.

 

An “Event of Default”
shall occur when any of the following occurs (whatever the reason for such
Event of Default and whether it shall be occasioned by the provisions of Article 5
hereof or be voluntary or involuntary or be effected by operation of law or
pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):

 

(a)  the Company shall fail to pay when due the
principal, Redemption Price or any Fundamental Change Repurchase Price of any
Security, including any Make-Whole Premium, when the same becomes due and
payable whether at the Final Maturity Date, upon redemption, repurchase,
acceleration or otherwise whether or not such payment is prohibited by Article 5
hereof; or

 

(b)  the Company shall fail to pay an installment
of interest, including Special Interest, if any, on any of the Securities,
which failure continues for 30 days after the date when due whether or not such
payment is prohibited by Article 5 hereof; or

 

(c)  the Company shall fail to deliver when due
all shares of Common Stock, together with cash instead of fractional shares
deliverable upon conversion of the Securities, which failure continues for 10
days; or

 

(d)  the Company fails to perform or observe any
other term, covenant or agreement contained in the Securities, this Indenture
and the failure continues for a period of 60 days after written notice of such
failure, requiring the Company to remedy the same, shall have been given 

 

51

 

to the
Company by the Trustee or to the Company and the Trustee by the Holders of at
least 25% in aggregate principal amount of the then-outstanding Securities; or

 

(e)  (i) the Company fails to make any
payment by the end of the applicable grace period, if any, after the maturity
of any Indebtedness for borrowed money in an amount in excess of $5,000,000, or
(ii) there is an acceleration of any Indebtedness for borrowed money in an
amount in excess of $5,000,000 because of a default with respect to such
Indebtedness without such Indebtedness having been discharged or such
acceleration having been cured, waived, rescinded or annulled, in the case of
either (i) or (ii) above, for a period of 30 days after written
notice to the Company by the Trustee or to the Company and the Trustee by
Holders of at least 25% in aggregate principal amount of the then-outstanding
Securities; or

 

(f)  the Company fails to provide a Fundamental
Change Company Notice in accordance with Section 3.08; or

 

(g)  a court having jurisdiction enters (i) a
decree or order for relief in respect of the Company in an involuntary case or
proceeding under any Bankruptcy Law, or (ii) a decree or order adjudging
the Company a bankrupt or insolvent, or approves as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in respect
of the Company under any applicable U.S. federal or state law, or appoints a
Receiver of the Company or of any substantial part of its property, or orders
the winding-up or liquidation of its affairs, and the continuance of any such
decree or order for relief or any such other decree or order unstayed and in
effect for a period of 60 consecutive days; or

 

(h)  the Company pursuant to or within the
meaning of any Bankruptcy Law:

 

(1) commences as a debtor a voluntary case or proceeding;

 

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

 

(3) consents to the appointment of a Receiver of it or for all or
substantially all of its property;

 

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

 

(5) files a petition in bankruptcy or answer or consent seeking
reorganization or relief; or

 

(6) consents to the filing of such a petition or the appointment
of or taking possession by a Receiver;

 

The term “Bankruptcy Law”
means Title 11 of the United States Code (or any successor thereto) or any
similar federal or state law for the relief of debtors. The term “Receiver” means any receiver, trustee,
assignee, liquidator, sequestrator or similar official under any Bankruptcy
Law.

 

52

 

Section 8.02                   Acceleration of Maturity; Rescission and Annulment.

 

If an Event of Default with respect to outstanding Securities (other
than an Event of Default specified in Section 8.01(g) or 8.01(h) hereof)
occurs and is continuing, the Trustee or the Holders of at least 25% in
aggregate principal amount of the then-outstanding Securities, by written notice
to the Company and the Trustee, may declare due and payable 100% of the
principal amount of all outstanding Securities plus any accrued and unpaid
interest, including Special Interest, if any, to the date of payment. Upon a
declaration of acceleration, such principal and accrued and unpaid interest to
the date of payment shall be immediately due and payable.

 

If an Event of Default specified in Section 8.01(g) or 8.01(h) hereof
occurs, all unpaid principal of and accrued and unpaid interest, including
Special Interest, if any, on the outstanding Securities shall become and be
immediately due and payable, without any declaration or other act on the part
of the Trustee or any Holder.

 

Notwithstanding the foregoing or anything to the contrary set forth in
this Indenture, to the extent elected by the Company, the sole remedy for an
Event of Default relating to the failure to comply with the reporting
obligations set forth in Section 6.05 herein, and for any failure to
comply with the requirements of Section 314(a)(1) of the Trust
Indenture Act, will for the first 180 days after the occurrence of such an
Event of Default consist exclusively of the right to receive special interest
on the Securities at an annual rate equal to 1.0% of the principal amount of the
Securities (“Special Interest”).
The Special Interest will accrue on all outstanding Securities from and
including the date on which an Event of Default relating to a failure to comply
with the reporting obligations set forth in Section 6.05 herein first
occurs to but not including the 180th day thereafter (or such earlier date on
which the Event of Default shall have been cured or waived). On such 180th day
(or earlier, if the Event of Default relating to the reporting obligations is
cured or waived prior to such 180th day), such Special Interest will cease to
accrue and, if the Event of Default relating to reporting obligations has not
been cured or waived prior to such 180th day, the Securities will be subject to
acceleration as provided above in this Section 8.02. In the event the
Company does not elect to pay Special Interest upon an Event of Default in
accordance with this paragraph, the Securities will be subject to acceleration
as provided above. If the Company elects to pay Special Interest as the sole
remedy for an Event of Default relating to the failure to comply with the
reporting obligations in Section 6.05 or for any failure to comply with
the requirements of Section 314(a)(1) of the TIA, the Company will
notify all Holders, the Trustee and Paying Agent of such election on or before
the close of business on the date on which such Event of Default first occurs.

 

The Holders of a majority in aggregate principal amount of the
then-outstanding Securities by written notice to the Trustee may rescind and
annul an acceleration and its consequences if:

 

(1) all existing Events of Default, other than the nonpayment of
principal of or interest, including Special Interest, if any, on the Securities
which has become due solely because of the acceleration, have been remedied,
cured or waived; and

 

53

 

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

 

provided, however,
that in the event such declaration of acceleration has been made based on the
existence of an Event of Default under Section 8.01(e) hereof and
such Event of Default has been remedied, cured or waived in accordance with Section 8.01(e) hereof,
then, without any further action by the Holders, such declaration of
acceleration shall be rescinded automatically and the consequences of such
declaration shall be annulled. No such rescission or annulment shall affect any
subsequent Default or impair any right consequent thereon.

 

Section 8.03                   Other Remedies.

 

If an Event of Default with respect to outstanding Securities occurs
and is continuing, the Trustee may pursue any available remedy by proceeding at
law or in equity to collect the payment of principal of or interest, including
Special Interest, if any, on the Securities or to enforce the performance of
any provision of the Securities.

 

Section 8.04                   Waiver of Past Defaults.

 

The Holders, either (a) through the written consent of not less
than a majority in aggregate principal amount of the then-outstanding
Securities, or (b) by the adoption of a resolution, at a meeting of
Holders of the then-outstanding Securities at which a quorum is present, by the
Holders of at least a majority in aggregate principal amount of the outstanding
Securities represented at such meeting, may, on behalf of the Holders of all of
the Securities, waive an existing Default or Event of Default, except a Default
or Event of Default:

 

(1) in the payment of the principal of or premium, if any, or
interest, including Special Interest, if any, on any Security (provided, however,
that subject to Section 8.07 hereof, the Holders of a majority in
aggregate principal amount of the then-outstanding Securities may rescind an
acceleration and its consequences, including any related payment default that
resulted from such acceleration);

 

(2) in respect of the right to convert any Security in accordance
with Article 4; or

 

(3) in respect of a covenant or provision hereof which, under Section 10.02
hereof, cannot be modified or amended without the consent of the Holder of each
outstanding Security affected.

 

Upon any such waiver, such Default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; provided, however,
that no such waiver shall extend to any subsequent or other Default or impair
any right consequent thereon.

 

Section 8.05                   Control by Majority.

 

The Holders, either (a) through the written consent of not less
than a majority in aggregate principal amount of the Securities then
outstanding, or (b) by the adoption of a resolution, at a meeting of
Holders of the Securities then outstanding at which a quorum is 

 

54

 

present, by the Holders of at least a majority in
aggregate principal amount of the outstanding Securities represented at such
meeting, shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee. However, the Trustee may refuse to
follow any direction that:

 

(a)  conflicts with any law or with this
Indenture;

 

(b)  the Trustee determines may be unduly
prejudicial to the rights of the Holders not joining therein; or

 

(c)  in the Trustee’s reasonable judgment may
expose the Trustee to personal liability.

 

The Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.

 

Section 8.06                   Limitation on Suit.

 

No Holder of any Security shall have any right to pursue any remedy
with respect to this Indenture or the Securities (including instituting any
proceeding, judicial or otherwise, with respect to this Indenture or for the
appointment of a receiver or trustee) unless:

 

(a)  such Holder has previously given written
notice to the Trustee of an Event of Default that is continuing;

 

(b)  the Holders of at least 25% in aggregate
principal amount of the Securities then outstanding shall have made written
request to the Trustee to pursue the remedy;

 

(c)  such Holder or Holders have offered to the
Trustee indemnity satisfactory to it against any costs, expenses and
liabilities incurred in complying with such request;

 

(d)  the Trustee has failed to comply with the
request for 60 days after its receipt of such notice, request and offer of
indemnity; and

 

(e)  during such 60-day period, no direction
inconsistent with such written request has been given to the Trustee by the
Holders of a majority in aggregate principal amount of the Securities then
outstanding (or such amount as shall have acted at a meeting pursuant to the
provisions of this Indenture).

 

Section 8.07                   Unconditional Rights of Holders to Receive Payment and
to Convert.

 

Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal amount, Redemption Price, Fundamental Change
Repurchase Price, interest, including Special Interest, if any, or Make-Whole
Premium, if any, in respect of the Securities held by such Holder, on or after
the respective due dates expressed in the Securities and this Indenture, and to
convert such Security in accordance with Article 4, and to bring suit for
the enforcement of any such payment on or after such respective due dates or
for the right to convert in accordance with Article 4, and shall not be
impaired or affected without the consent of such Holder.

 

55

 

Section 8.08                   Collection of Indebtedness and Suits for Enforcement
by the Trustee.

 

The Company covenants that if:

 

(a)  a Default or Event of Default occurs in the
payment of any interest, including Special Interest, on any Security when such
interest becomes due and payable and such Default or Event of Default continues
for a period of 30 days; or

 

(b)  a Default or Event of Default occurs in the
payment of the principal of or premium, if any, on any Security at the Maturity
thereof, the Company shall, upon demand of the Trustee, pay to it, for the
benefit of the Holders of such Securities, the whole amount then due and
payable (as expressed therein or as a result of any acceleration effected
pursuant to Section 8.02 hereof) on such Securities for principal and
premium, if any, and interest, including Special Interest, and, to the extent
that payment of such interest shall be legally enforceable, interest on any
overdue principal and premium, if any, and on any overdue interest, including
Special Interest, in each case at the Interest Rate, and, in addition thereto,
such further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.

 

If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may institute
a judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company and collect the moneys adjudged or decreed to be payable in
the manner provided by law out of the property of the Company, wherever
situated.

 

If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce its rights and the rights of the
Holders of Securities by such appropriate judicial proceedings as the Trustee
shall deem most effectual to protect and enforce any such rights, whether for
the specific enforcement of any covenant or agreement in this Indenture or in
aid of the exercise of any power granted herein, or to enforce any other proper
remedy.

 

Section 8.09                   Trustee May File Proofs of Claim.

 

In case of the pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Company or the property of the Company or its
creditors, the Trustee (irrespective of whether the principal of the Securities
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of overdue principal or interest, including Special
Interest, if any) shall be entitled and empowered, by intervention in such
proceeding or otherwise, (1) to file and prove a claim for the whole
amount of principal and premium, if any, and interest, including Special
Interest, if any, owing and unpaid in respect of the Securities and to file
such other papers or documents as may be necessary or advisable in order to
have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due to the Trustee hereunder) and of the
Holders of Securities allowed in such judicial proceeding, and (2) to
collect and receive any moneys or other property payable or deliverable on any
such claim and to distribute the same; 

 

56

 

and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceedings is hereby authorized by each Holder of Securities to make such
payments to the Trustee and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders of Securities, to pay to the
Trustee any amount due to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel and any other
amounts due the Trustee under Section 9.08 of this Indenture.

 

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

 

Section 8.10                   Restoration of Rights and Remedies.

 

If the Trustee or any Holder of a Security has instituted any
proceeding to enforce any right or remedy under this Indenture and such
proceeding has been discontinued or abandoned for any reason, or has been
determined adversely to the Trustee or to such Holder, then, and in every such
case, subject to any determination in such proceeding, the Company, the Trustee
and the Holders of Securities shall be restored severally and respectively to
their former positions hereunder and thereafter all rights and remedies of the
Trustee and the Holders shall continue as though no such proceeding had been
instituted.

 

Section 8.11                   Rights and Remedies Cumulative.

 

Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Securities in the last paragraph of Section 2.11
of this Indenture, no right or remedy conferred in this Indenture upon or
reserved to the Trustee or to the Holders of Securities is intended to be
exclusive of any other right or remedy, and every right and remedy shall, to
the extent permitted by law, be cumulative and in addition to every other right
and remedy given hereunder or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or employment of any
other appropriate right or remedy.

 

Section 8.12                   Delay or Omission Not Waiver.

 

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

 

Section 8.13                   Application of Money Collected.

 

Subject to Article 5, any money and property collected by the
Trustee pursuant to this Article shall be applied in the following order,
at the date or dates fixed by the Trustee and, in case of the distribution of
such money and property on account of principal or premium, if any, 

 

57

 

or interest, including Special Interest, if any, upon
presentation of the Securities and the notation thereon of the payment if only
partially paid and upon surrender thereof if fully paid:

 

FIRST: To the payment of all amounts due the Trustee;

 

SECOND: To the payment of the amounts then due and unpaid for principal
of and premium, if any, and interest, including Special Interest, if any, on
the Securities and coupons in respect of which or for the benefit of which such
money has been collected, ratably, without preference or priority of any kind,
according to the amounts due and payable on such Securities for principal and
premium, if any, and interest, including Special Interest, if any,
respectively; and

 

THIRD: Any remaining amounts shall be repaid to the Company.

 

Section 8.14                   Undertaking for Costs.

 

All parties to this Indenture agree, and each Holder of any Security by
such Holder’s acceptance thereof shall be deemed to have agreed, that any court
may in its discretion require, in any suit for the enforcement of any right or
remedy under this Indenture, or in any suit against the Trustee for any action
taken, suffered or omitted by it as Trustee, the filing by any party litigant
in such suit of an undertaking to pay the costs of such suit, and that such
court may in its discretion assess reasonable costs, including reasonable
attorneys’ fees, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by such party
litigant; but the provisions of this Section shall not apply to any suit
instituted by the Company, to any suit instituted by the Trustee, to any suit
instituted by any Holder, or group of Holders, holding in the aggregate more
than 10% in aggregate principal amount of the Securities then outstanding, or
to any suit instituted by any Holder of any Security for the enforcement of the
payment of the principal of or premium, if any, or interest, including Special
Interest, if any, on any Security on or after the Stated Maturity expressed in
such Security (or, in the case of exercise of a repurchase right in connection
with a Fundamental Change, on or after the Fundamental Change Repurchase Date)
or for the enforcement of the right to convert any Security in accordance with Article 4.

 

Section 8.15                   Waiver of Stay or Extension Laws.

 

The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever
claim to take the benefit or advantage of, any stay or extension law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company (to the extent that it
may lawfully do so) hereby expressly waives all benefit or advantage of any
such law and covenants that it will not hinder, delay or impede the execution
of any power herein granted to the Trustee, but will suffer and permit the
execution of every such power as though no such law had been enacted.

 

58

 

Article 9

The Trustee

 

Section 9.01                   Certain Duties and
Responsibilities.

 

(a)           Except
during the continuance of an Event of Default,

 

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

 

(2)           In the
absence of bad faith on its part, the Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed therein,
upon certificates or opinions furnished to the Trustee and conforming to the
requirements of this Indenture; provided, however, that in the case of any such
certificates or opinions which by any provision hereof are specifically required
to be furnished to the Trustee, the Trustee shall examine the certificates or
opinions to determine whether or not, on their face, they conform to the
requirements to this Indenture (but need not investigate or confirm the
accuracy of any facts stated therein).

 

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

 

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

 

(1)           This
paragraph (c) shall not be construed to limit the effect of paragraph (a) of
this Section 9.01;

 

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

 

(3)           The
Trustee shall not be liable with respect to any action taken or omitted to be
taken by it in good faith in accordance with a direction received by it of the
Holders of a majority in principal amount of the outstanding Securities (or
such lesser amount as shall have acted at a meeting pursuant to the provisions
of this Indenture) relating to the time, method and place of conducting any
proceeding for any remedy available to the

 

Trustee, or exercising any trust or power conferred
upon the Trustee, under this Indenture.

 

59

 

(d)           Whether
or not herein expressly so provided, every provision of this Indenture relating
to the conduct or affecting the liability of or affording protection to the
Trustee shall be subject to the provisions of this Section 9.01.

 

(e)           No
provision of this Indenture shall require the Trustee to expend or risk its own
funds or otherwise incur any liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers.  The Trustee may refuse to perform any duty or
exercise any right or power unless it receives indemnity satisfactory to it
against any loss, liability, cost or expense (including, without limitation,
reasonable fees of counsel).

 

(f)            The
Trustee shall not be obligated to pay interest on any money or other assets
received by it unless otherwise agreed in writing with the Company.  Assets held in trust by the Trustee need not
be segregated from other funds except to the extent required by law.

 

(g)           The
Trustee shall not be bound to make any investigation into the facts or matters
stated in any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, Security, coupon,
other evidence of indebtedness or other paper or document, but the Trustee, in
its discretion, may make such further inquiry or investigation into such facts
or matters as it may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled to examine the books,
records and premises of the Company, personally or by agent or attorney at the
sole cost of the Company and shall incur no liability or additional liability
of any kind by reason of such inquiry or investigation.

 

(h)           The
Trustee shall not be deemed to have notice or actual knowledge of any Event of
Default unless a Responsible Officer of the Trustee has actual knowledge
thereof or unless written notice of any event which is in fact a Default is
received by the Trustee pursuant to Section 13.02 hereof, and such notice
references the Securities and this Indenture.

 

(i)            The
rights, privileges, protections, immunities and benefits given to the Trustee
hereunder, including, without limitation, its right to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and each Paying Agent, authenticating agent, Conversion Agent or
Registrar acting hereunder.

 

Section 9.02                   Certain Rights of Trustee.

 

Subject to the provisions of Section 9.01 hereof
and subject to Sections 315(a) through (d) of the TIA:

 

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

 

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

 

60

 

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

 

(4)           The
Trustee shall not be liable for any action taken or omitted to be taken by it
in good faith, which it believed to be authorized or within the discretion or
rights or powers conferred upon it by this Indenture, unless the Trustee’s
conduct constitutes negligence.

 

(5)           The
Trustee may consult with counsel of its selection and the advice of such
counsel as to matters of law shall be full and complete authorization and
protection in respect of any action taken, omitted or suffered by it hereunder
in good faith and in accordance with the advice or opinion of such counsel.

 

(6)           Unless otherwise
specifically provided in this Indenture, any demand, request, direction or
notice from the Company shall be sufficient if signed by an Officer of the
Company.

 

(7)           The
permissive rights of the Trustee to do things enumerated in this Indenture shall
not be construed as a duty unless so specified herein.

 

Section 9.03                   Individual Rights of Trustee.

 

The Trustee in its individual or any other capacity
may become the owner or pledgee of Securities and may otherwise deal with the
Company or any Affiliate of the Company with the same rights it would have if
it were not Trustee.  However, in the
event that the Trustee acquires any conflicting interest (as such term is
defined in Section 310(b) of the TIA), it must eliminate such
conflict within 90 days, apply to the SEC for permission to continue as trustee
(to the extent permitted under Section 310(b) of the TIA) or
resign.  Any agent may do the same with
like rights and duties.  The Trustee is
also subject to Sections 9.11 and 9.12 hereof.

 

Section 9.04                   Money Held in Trust.

 

Money held by the Trustee in trust hereunder need not
be segregated from other funds except to the extent required by law.  The Trustee shall be under no liability for
interest on any money received by it hereunder except as otherwise expressly
agreed with the Company.

 

Section 9.05                   Trustee’s Disclaimer.

 

The recitals contained herein and in the Securities
(except for those in the certificate of authentication) shall be taken as the
statements of the Company, and the Trustee assumes no responsibility for their
correctness.  The Trustee makes no
representations as to the validity, sufficiency or priority of this Indenture
or of the Securities.  The Trustee shall
not be accountable for the use or application by the Company of Securities or
the proceeds thereof.

 

61

 

Section 9.06                   Notice of Defaults.

 

Within 90 days after the occurrence of any Default or
Event of Default hereunder of which the Trustee has received written notice,
the Trustee shall give notice to Holders pursuant to Section 13.02 hereof,
unless such Default or Event of Default shall have been cured or waived;
provided, however, that, except in the case of a Default or Event of Default in
the payment of the principal of or premium, if any, or interest, or in the
payment of any redemption or repurchase obligation on any Security, the Trustee
shall be protected in withholding such notice if and so long as Responsible
Officers of the Trustee in good faith determine that the withholding of such
notice is in the interest of the Holders.

 

Section 9.07                   Reports by Trustee to Holders.

 

The Trustee shall transmit to holders as provided in Section 313
of the TIA such reports concerning the Trustee and its actions under this
Indenture as may be required by Section 313 of the TIA at the times and in
the manner provided by the TIA.

 

A copy of each report at the time of its mailing to
Holders shall be filed with the SEC, if required by Section 313 of the
TIA, and each stock exchange, if any, on which the Securities are listed.  The Company shall promptly notify the Trustee
when the Securities become listed on any stock exchange.

 

Section 9.08                   Compensation and Indemnification.

 

The Company covenants and agrees to pay to the Trustee
from time to time, and the Trustee shall be entitled to, reasonable
compensation (which shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust) and the Company covenants
and agrees to pay or reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by or on behalf of it in
accordance with any of the provisions of this Indenture (including the
reasonable compensation and the expenses and disbursements of its counsel and of
all agents and other persons not regularly in its employ), except to the extent
that any such expense, disbursement or advance is due to its negligence or bad
faith.  When the Trustee incurs expenses
or renders services in connection with an Event of Default specified in Section 8.01
hereof, the expenses (including the reasonable charges and expenses of its
counsel) and the compensation for the services are intended to constitute
expenses of administration under any Bankruptcy Law.  The Company also covenants to indemnify the
Trustee and its officers, directors, employees and agents for, and to hold such
Persons harmless against, any loss, liability or expense incurred by them,
arising out of or in connection with the acceptance or administration of this Indenture
or the trusts hereunder or the performance of their duties hereunder, including
the costs and expenses of defending themselves against or investigating any
claim of liability in the premises, except to the extent that any such loss,
liability or expense was due to the negligence or willful misconduct of such
Persons.  The obligations of the Company
under this Section 9.08 to compensate and indemnify the Trustee and its
officers, directors, employees and agents and to pay or reimburse such Persons
for expenses, disbursements and advances shall constitute additional
indebtedness hereunder and shall survive the satisfaction and discharge of this
Indenture or the earlier resignation or removal of the Trustee.  Such additional indebtedness shall be a senior
claim to that of the Securities upon all property and funds held or collected
by the Trustee as such, except funds held in trust for the benefit of the
Holders of particular Securities, and the Securities are hereby subordinated to
such 

 

62

 

senior claim.  “Trustee”
for purposes of this Section 9.08 shall include any predecessor Trustee,
but the negligence or willful misconduct of any Trustee shall not affect the
indemnification of any other Trustee.

 

Section 9.09                   Replacement of Trustee.

 

A resignation or removal of the Trustee and
appointment of a successor Trustee shall become effective only upon the
successor Trustee’s acceptance of appointment as provided in this Section 9.09.

 

The Trustee may resign and be discharged from the
trust hereby created by so notifying the Company in writing.  The Holders of at least a majority in
aggregate principal amount of Outstanding Securities may remove the Trustee by
so notifying the Trustee and the Company in writing.  The Company must remove the Trustee if:

 

(a)   the Trustee fails
to comply with Section 9.11 hereof or Section 310 of the TIA;

 

(b)   the Trustee
becomes incapable of acting.

 

(c)   the Trustee is
adjudged a bankrupt or an insolvent or an order for relief is entered with
respect to the Trustee under any Bankruptcy Law; or

 

(d)   a custodian or
public officer takes charge of the Trustee or its property.

 

If the Trustee resigns or is removed or if a vacancy
exists in the office of the Trustee for any reason, the Company shall promptly
appoint a successor Trustee.  The Trustee
shall be entitled to payment of its fees and reimbursement of its expenses
while acting as Trustee.  Within one year
after the successor Trustee takes office, the Holders of at least a majority in
aggregate principal amount of outstanding Securities may appoint a successor
Trustee to replace the successor Trustee appointed by the Company.

 

Any Holder may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee if the Trustee fails to comply with Section 9.11 hereof.

 

If an instrument of acceptance by a successor Trustee
shall not have been delivered to the Trustee within 30 days after the giving of
such notice of resignation or removal, the resigning or removed Trustee, as the
case may be, may petition, at the expense of the Company, any court of
competent jurisdiction for the appointment of a successor Trustee.

 

A successor Trustee shall deliver a written acceptance
of its appointment to the retiring Trustee and to the Company.  Thereupon the resignation or removal of the
retiring Trustee shall become effective, and the successor Trustee shall have
all the rights, powers and duties of the Trustee under this Indenture.  The Company shall mail a notice of the
successor Trustee’s succession to the Holders. 
The retiring Trustee shall promptly transfer all property held by it as
Trustee to the successor Trustee. 
Notwithstanding replacement of the Trustee pursuant to this Section 9.09,
the Company’s obligations under Section 9.08 hereof shall continue for the
benefit 

 

63

 

of the retiring Trustee with respect to expenses,
losses and liabilities incurred by it prior to such replacement.

 

Section 9.10                   Successor Trustee by Merger, Etc.

 

Subject to Section 9.11 hereof, if the Trustee
consolidates with, merges or converts into, or transfers or sells all or
substantially all of its corporate trust business to, another corporation or
national banking association, the successor entity without any further act
shall be the successor Trustee as to the Securities.

 

Section 9.11                   Corporate Trustee Required;
Eligibility.

 

The Trustee shall at all times satisfy the
requirements of Sections 310(a)(1), (2) and (5) of the TIA.  The Trustee shall at all times have (or, in
the case of a corporation included in a bank holding company system, the
related bank holding company shall at all times have), a combined capital and
surplus of at least $100 million as set forth in its (or its related bank
holding company’s) most recent published annual report of condition.  The Trustee is subject to Section 310(b) of
the TIA.

 

Section 9.12                   Collection of Claims Against the
Company.

 

The Trustee is subject to Section 311(a) of
the TIA, excluding any creditor relationship listed in Section 311(b) of
the TIA.  A Trustee who has resigned or
been removed shall be subject to Section 311(a) of the TIA to the
extent indicated therein.

 

Article 10

 

Amendments;
Supplements and Waivers

 

Section 10.01                 Without
Consent of Holders.

 

The Company and the Trustee may amend or supplement
this Indenture or the Securities without notice to or consent of any Holder of
a Security for any of the following purposes:

 

(a)  add to the covenants of the Company for the
benefit of the Holders of Securities;

 

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

 

(c)  make provision with respect to the
conversion rights of Holders of Securities pursuant to Section 4.11
hereof;

 

(d)  provide for the assumption of the Company’s
obligations to the Holders of Securities in the case of a merger,
consolidation, conveyance, transfer or lease pursuant to Article 7 hereof;

 

(e)  increase the Conversion Rate; provided, however,
that such increase in the Conversion Rate shall not adversely affect the
interest of the Holders of Securities (after taking into account tax and other
consequences of such increase) in any material respect;

 

64

 

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

 

(g)  cure any ambiguity, correct or supplement
any provision herein which may be inconsistent with any other provision herein
or which is otherwise defective; provided,
however, that such action
pursuant to this clause (g) does not, in the good faith opinion of the
Board of Directors and the Trustee, adversely affect the interests of the
Holders of Securities in any material respect; and provided, further,
that no modification or amendment made to conform this Indenture or the
Securities to the section of the Final Prospectus entitled “Description of the
Notes” shall be deemed to adversely affect the interests of the Holders of the
Securities;

 

(h)  add or modify any other provisions with
respect to matters or questions arising under this Indenture which the Company
and the Trustee may deem necessary or desirable and which shall not be
inconsistent with the provisions of this Indenture, provided, however;
that such action pursuant to this clause (h) does not adversely affect the
interests of the Holders of Securities in any material respect;

 

(i) to comply with Article 7;

 

(j) to provide for uncertificated Securities in
addition to or in place of Certificated Securities;

 

(k) to provide for the issuance of and establish
the form and terms and conditions of additional series of Securities;

 

(l) to evidence and provide for the acceptance of
appointment hereunder by a successor Trustee with respect to the Securities and
to add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee; or

 

(m) to provide for the addition of a guaranty of
the notes by any other entity.

 

Section 10.02                 With Consent
of Holders.

 

Except as provided below in this Section 10.02,
this Indenture or the Securities may be amended or supplemented, and
noncompliance by the Company in any particular instance with any provision of
this Indenture or the Securities may be waived, in each case (i) with the
written consent of the Holders of at least a majority in aggregate principal
amount of the then-outstanding Securities, or (ii) by the adoption of a
resolution, at a meeting of Holders of the Securities then outstanding at which
a quorum is present, by the Holders of a majority in aggregate principal amount
of the then-outstanding Securities represented at such meeting.

 

Without the written consent or the affirmative vote of
each Holder of Securities affected, an amendment or waiver under this Section 10.02
may not:

 

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

 

65

 

(b)   reduce the
principal amount of or premium, if any, on any Security;

 

(c)   reduce the
interest rate or interest, including Special Interest, on any Security;

 

(d)   change the
currency of payment of principal of, premium, if any, or interest, including
Special Interest, on any Security;

 

(e)   impair the right
of any Holder to institute suit for the enforcement of any payment on or with
respect to, or the conversion of, any Security;

 

(f)    modify the
obligation of the Company to maintain an office or agency in The City of New
York pursuant to Section 2.04 hereof;

 

(g)   except as
permitted by Section 4.11 hereof, adversely affect the right to convert
any Security as provided in Article 4 hereof;

 

(h)   adversely affect
the right of Holders to require the Company to repurchase the Securities in the
event of a Fundamental Change;

 

(i)    modify the
subordination provisions of the Securities in a manner adverse to the Holders
of Securities;

 

(j)    modify any of
the provisions of this Section, Section 8.04 or Section 8.11, except
to increase any percentage contained herein or therein or to provide that
certain other provisions of this Indenture cannot be modified or waived without
the consent of the Holder of each outstanding Security affected thereby; or

 

(k)   reduce the
requirements of Section 12.04 hereof for quorum or voting, or reduce the
percentage in aggregate principal amount of the outstanding Securities the
consent of whose Holders is required for any such amendment or the consent of
whose Holders is required for any waiver provided for in this Indenture.

 

It shall not be necessary for any act of Holders of
Securities under this Section to approve the particular form of any
proposed supplemental indenture, but it shall be sufficient if such act shall
approve the substance thereof.

 

After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company shall promptly mail to the Holders affected
thereby a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such amendment,
supplement or waiver.

 

Section 10.03.                Compliance with Trust Indenture Act.

 

Every amendment to this Indenture or the Securities of
one or more Series shall be set forth in a supplemental indenture hereto
that complies with the TIA as then in effect.

 

66

 

Section 10.04.                Revocation and Effect of Consents.

 

Until an amendment or waiver becomes effective, a
consent to it by a Holder of a Security is a continuing consent by the Holder
and every subsequent Holder of a Security or portion of a Security that
evidences the same debt as the consenting Holder’s Security, even if notation
of the consent is not made on any Security. However, any such Holder or
subsequent Holder may revoke the consent as to his Security or portion of a
Security if the Trustee receives the notice of revocation before the date the
amendment or waiver becomes effective.

 

Any amendment or waiver once effective shall bind
every Holder of each Series affected by such amendment or waiver unless it
is of the type described in any of clauses (a) through (g) of Section 9.3.
In that case, the amendment or waiver shall bind each Holder of a Security who
has consented to it and every subsequent Holder of a Security or portion of a
Security that evidences the same debt as the consenting Holder’s Security.

 

The Company may, but shall not be obligated to, fix a
record date for the purpose of determining the Holders 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
Holders 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 Holders after such record date.

 

Section 10.05.                Notation on or Exchange of
Securities.

 

The Trustee may place an appropriate notation about an
amendment or waiver on any Security of any Series thereafter
authenticated. The Company in exchange for Securities of that Series may
issue and the Trustee shall authenticate upon written request new Securities of
that Series that reflect the amendment or waiver.

 

Section 10.06.                Trustee Protected.

 

In executing, or accepting the additional trusts
created by, any supplemental indenture permitted by this Article or the
modifications thereby of the trusts created by this Indenture, the Trustee
shall be entitled to receive, and (subject to Section 7.1) shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
such supplemental indenture is authorized or permitted by this Indenture. The
Trustee shall sign all supplemental indentures, except that the Trustee need
not sign any supplemental indenture that adversely affects its rights.

 

Article 11

Satisfaction and Discharge

 

Section 11.01                 Satisfaction
and Discharge of Indenture.

 

When:

 

(a)   The
Company shall deliver to the Trustee for cancellation all Securities previously
authenticated (other than any Securities which have been destroyed, lost or
stolen and in 

 

67

 

        lieu of or in substitution for which other
Securities shall have been authenticated and delivered) and not previously
cancelled; or

 

(b)   (1) All
the Securities not previously canceled or delivered to the Trustee for
cancellation shall have become due and payable, or are by their terms to become
due and payable within one year; and

 

     (2) The Company shall deposit with
the Trustee, in trust, cash in U.S. dollars and/or U.S. Government Obligations
which through the payment of interest, including Special Interest, if any, and
principal in respect thereof, in accordance with their terms, will provide (and
without reinvestment), not later than one day before the due date of any payment
of money, an amount in cash, sufficient, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay principal of, premium,
if any, or interest, including Special Interest, if any, on all of the
Securities (other than any securities which shall have been mutilated,
destroyed, lost or stolen and in lieu of or in substitution for which other
Securities shall have been authenticated and delivered) not previously
cancelled or delivered to the Trustee for cancellation, on the dates such
payments of principal, premium, if any, or interest are due to such date of
maturity, redemption or repurchase, as the case may be, and if, in the case of
either clause (a) or (b), the Company shall also pay or cause to be paid
all other sums payable hereunder by the Company, then this Indenture shall
cease to be of further effect (except as to: (i) remaining rights of
registration of transfer, substitution and exchange and conversion of
Securities, (ii) rights hereunder of Holders to receive payments of
principal of and premium, if any, and interest, including Special Interest, if
any, on the Securities and the other rights, duties and obligations of Holders,
as beneficiaries hereof with respect to the amounts, if any, so deposited with
the Trustee, and (iii) the rights, obligations and immunities of the
Trustee hereunder), and the Trustee, on demand of the Company accompanied by an
Officers’ Certificate and an Opinion of Counsel and at the cost and expense of
the Company, shall execute proper instruments acknowledging satisfaction of and
discharging this Indenture; provided,
however, that the Company shall
promptly reimburse the Trustee for all amounts due the Trustee under Section 9.08
of this Indenture and for any costs or expenses thereafter reasonably and
properly incurred by the Trustee and to compensate the Trustee for any services
thereafter reasonably and properly rendered by the Trustee in connection with
this Indenture or the Securities.

 

Section 11.02                 Deposited
Monies To Be Held in Trust.

 

Subject to Section 11.03 hereof, all monies
deposited with the Trustee pursuant to Section 11.01 hereof shall be held
in trust and applied by it to the payment, notwithstanding the provisions of Article 5
hereof, either directly or through any Paying Agent (including the Company if
acting as its own Paying Agent), to the Holders of the particular Securities
for the payment, redemption or repurchase of which such monies have been deposited
with the Trustee, of all sums due and to become due thereon for principal,
premium, if any, and interest, including Special Interest, if any. All monies
deposited with the Trustee pursuant to Section 11.01 hereof (and held by
it or any Paying Agent) for the payment of Securities subsequently converted
shall be returned to the Company upon request of the Company.

 

68

 

Section 11.03                 Return of
Unclaimed Monies.

 

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 premium, if any, or interest that remains unclaimed for two years
after the date upon which such payment shall have become due. Notwithstanding
the foregoing, the Trustee and Paying Agent shall have the right to withhold
payment of such money to the Company until the Trustee or Paying Agent at the
expense of the Company publishes in a newspaper of general circulation in New
York City, or mails to each Holder, a notice stating that such money shall be
repaid to the Company if unclaimed after a date no less than 30 days from the
publication of such press release or mailing of such notice. After payment to
the Company, all liability of the Trustee and the Paying Agent with respect to
such money shall cease, and Holders entitled to the money must look to the
Company for payment as general creditors unless an applicable abandoned
property law designates another Person.

 

Article 12

Meeting of Holders of Securities

 

Section 12.01                 Purposes for
Which Meetings May Be Called.

 

A meeting of Holders of Securities may be called at
any time and from time to time pursuant to this Article to make, give or
take any request, demand, authorization, direction, notice, consent, waiver or
other action provided by this Indenture to be made, given or taken by Holders
of Securities.

 

Notwithstanding anything contained in this Article 12,
the Trustee may, during the pendency of a Default or an Event of Default, call
a meeting of Holders of Securities in accordance with its standard practices.

 

Section 12.02                 Call Notice
and Place of Meetings.

 

The Trustee may at any
time call a meeting of Holders of Securities for any purpose specified in Section 11.02
hereof, to be held at such time and at such place in The City of New York.
Notice of every meeting of Holders of Securities, setting forth the time and
the place of such meeting, in general terms the action proposed to be taken at
such meeting and the percentage of the principal amount of the then-outstanding
Securities which shall constitute a quorum at such meeting, shall be given, in
the manner provided in the Indenture hereof, not less than 21 nor more than 180
days prior to the date fixed for the meeting.

 

In case at any time the Company, pursuant to a resolution
of the Board of Directors, or the Holders of at least 10% in principal amount
of the Securities then outstanding shall have requested the Trustee to call a
meeting of the Holders of Securities for any purpose specified in Section 12.01
hereof, by written request setting forth in reasonable detail the action
proposed to be taken at the meeting, and the Trustee shall not have made the
first publication of the notice of such meeting within 21 days after receipt of
such request or shall not thereafter proceed to cause the meeting to be held as
provided herein, then the Company or the Holders of Securities in the amount
specified, as the case may be, may determine the time and the place in The City
of New York for such meeting and may call such meeting for such purposes by
giving notice thereof as provided in paragraph (a) of this Section.

 

69

 

Section 12.03                 Persons
Entitled to Vote at Meetings.

 

To be entitled to vote at any meeting of Holders of
Securities, a Person shall be (a) a Holder of one or more outstanding
Securities, or (b) a Person appointed by an instrument in writing as proxy
for a Holder or Holders of one or more outstanding Securities by such Holder or
Holders. The only Persons who shall be entitled to be present or to speak at
any meeting of Holders shall be the Persons entitled to vote at such meeting
and their counsel, any representatives of the Trustee and its counsel and any
representatives of the Company and its counsel.

 

Section 12.04                 Quorum; Action.

 

The Persons entitled to vote a majority in principal
amount of the then-outstanding Securities shall constitute a quorum. In the
absence of a quorum within 30 minutes of the time appointed for any such
meeting, the meeting shall, if convened at the request of Holders of
Securities, be dissolved. In any other case, the meeting may be adjourned for a
period of not less than 10 days as determined by the chairman of the meeting
prior to the adjournment of such meeting. In the absence of a quorum at any
such adjourned meeting, such adjourned meeting may be further adjourned for a
period of not less than 10 days as determined by the chairman of the meeting
prior to the adjournment of such adjourned meeting. Notice of the reconvening
of any adjourned meeting shall be given as provided in Section 12.02(a) hereof,
except that such notice need be given only once and not less than five days
prior to the date on which the meeting is scheduled to be reconvened.

 

At a meeting or an adjourned meeting duly reconvened
and at which a quorum is present as aforesaid, any resolution and all matters
(except as limited by the third paragraph of Section 9.02 hereof) shall be
effectively passed and decided if passed or decided by the Persons entitled to
vote not less than a majority in principal amount of Securities then
outstanding represented and voting at such meeting.

 

Any resolution passed or decisions taken at any
meeting of Holders of Securities duly held in accordance with this Section shall
be binding on all the Holders of Securities, whether or not present or
represented at the meeting.

 

Section 12.05                 Determination
of Voting Rights; Conduct and Adjournment of Meetings.

 

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

 

The Trustee shall, by an instrument in writing,
appoint a temporary chairman (which may be the Trustee) of the meeting, unless
the meeting shall have been called by the Company or by Holders of Securities
as provided in Section 12.02(b) hereof, in which case the Company or
the Holders of Securities calling the meeting, as the case may be, shall in
like manner appoint a 

 

70

 

temporary
chairman. A permanent chairman and a permanent secretary of the meeting shall
be elected by vote of the Persons entitled to vote a majority in principal
amount of the outstanding Securities represented at the meeting.

 

At any meeting, each Holder of a Security or proxy
shall be entitled to one vote for each $1,000 principal amount of Securities
held or represented by him; provided,
however, that no vote shall be
cast or counted at any meeting in respect of any Security challenged as not
outstanding and ruled by the chairman of the meeting to be not outstanding. The
chairman of the meeting shall have no right to vote, except as a Holder of a
Security or proxy.

 

Any meeting of Holders of Securities duly called
pursuant to Section 12.02 hereof at which a quorum is present may be
adjourned from time to time by Persons entitled to vote a majority in principal
amount of the then-outstanding Securities represented at the meeting, and the
meeting may be held as so adjourned without further notice.

 

Section 12.07                 Counting Votes
and Recording Action of Meetings.

 

The vote upon any resolution submitted to any meeting
of Holders of Securities shall be by written ballots on which shall be
subscribed the signatures of the Holders of Securities or of their
representatives by proxy and the principal amounts and serial numbers of the
outstanding Securities held or represented by them. The permanent chairman of
the meeting shall appoint two inspectors of votes who shall count all votes
cast at the meeting for or against any resolution and who shall make and file
with the secretary of the meeting their verified written reports in duplicate
of all votes cast at the meeting. A record, at least in duplicate, of the
proceedings of each meeting of Holders of Securities shall be prepared by the
secretary of the meeting and there shall be attached to said record the
original reports of the inspectors of votes on any vote by ballot taken thereat
and affidavits by one or more Persons having knowledge of the facts setting
forth a copy of the notice of the meeting and showing that said notice was
given as provided in Section 12.02 hereof and, if applicable, Section 12.04
hereof. Each copy shall be signed and verified by the affidavits of the
permanent chairman and secretary of the meeting and one such copy shall be
delivered to the Company and another to the Trustee to be preserved by the
Trustee, the latter to have attached thereto the ballots voted at the meeting.
Any record so signed and verified shall be conclusive evidence of the matters
therein stated.

 

Article 13

Miscellaneous

 

Section 13.01                 Trust Indenture Act Controls.

 

This Indenture is subject to the provisions of the TIA
which are required to be part of this Indenture, and shall, to the extent
applicable, be governed by such provisions.

 

Section 13.02                 Notices.

 

Any notice or communication to the Company or the
Trustee is duly given if in writing and delivered in person or mailed by
first-class mail to the address set forth below:

 

71

 

if to
the Company:

 

Vertex Pharmaceuticals
Incorporated

130 Waverly Street

Cambridge, MA  02139

Attention:  Investor Relations

 

with a copy to:

 

Mintz, Levin, Cohn,
Ferris, Glovsky

and Popeo, P.C.

One Financial Center

Boston, MA  02111

Attention:  Michael L. Fantozzi, Esq.

 

if to
the Trustee:

 

U.S. Bank National
Association

Corporate Trust
Department

One Federal Street,
Boston, MA 02110

Attention: Andrew M.
Sinasky

 

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

 

Any notice or communication to a Holder shall be
mailed by first-class mail to his address shown on the Register kept by the
Registrar.  Failure to mail a notice or
communication to a Holder or any defect in such notice or communication shall
not affect its sufficiency with respect to other Holders.

 

If a notice or communication is mailed or sent in the
manner provided above within the time prescribed, it is duly given as of the
date it is mailed, whether or not the addressee receives it, except that notice
to the Trustee shall only be effective upon receipt thereof by the Trustee.

 

If the Company mails a notice or communication to
Holders, it shall mail a copy to the Trustee at the same time.

 

Section 13.03                 Communication by Holders With Other
Holders.

 

Holders may communicate pursuant to Section 312(b) of
the TIA with other Holders with respect to their rights under the Securities or
this Indenture.  The Company, the
Trustee, the Registrar and anyone else shall have the protection of Section 312(c) of
the TIA.

 

Section 13.04                 Acts of Holders of Securities.

 

(a)   Any request,
demand, authorization, direction, notice, consent, waiver or other action
provided by this Indenture to be given or taken by Holders of Securities may be
embodied in and evidenced by:

 

72

 

(1)   one or more
instruments of substantially similar tenor signed by such Holders in person or
by agent or proxy duly appointed in writing;

 

(2)   the record of
Holders of Securities voting in favor thereof, either in person or by proxies
duly appointed in writing, at any meeting of Holders of Securities duly called
and held in accordance with the provisions of Article 12; or

 

(3)   a combination of
such instruments and any such record.

 

Except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments or record or
both are delivered to the Trustee and, where it is hereby expressly required,
to the Company.  Such instrument or
instruments and record (and the action embodied therein and evidenced thereby)
are herein sometimes referred to as the “Act” of the Holders of Securities
signing such instrument or instruments and so voting at such meeting.  Proof of execution of any such instrument or
of a writing appointing any such agent or proxy, or of the holding by any
Person of a Security, shall be sufficient for any purpose of this Indenture and
(subject to Section 9.01 hereof) conclusive in favor of the Trustee and
the Company if made in the manner provided in this Section.  The record of any meeting of Holders of
Securities shall be proved in the manner provided in Section 12.06 hereof.

 

(b)   The fact and date
of the execution by any Person of any such instrument or writing may be
provided in any manner which the Trustee reasonably deems sufficient.

 

(c)   The principal
amount and serial numbers of Securities held by any Person, and the date of
such Person holding the same, shall be proved by the Register.

 

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

 

Section 13.05                 Certificate and Opinion as to
Conditions Precedent.

 

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

 

Any certificate or opinion of an officer of the
Company may be based, insofar as it relates to legal matters, upon an Opinion
of Counsel, unless such officer knows, or in the exercise of reasonable care
should know, that the Opinion of Counsel with respect to the matters upon which
such certificate or opinion is based is erroneous.  Any such Opinion of Counsel may be based,
insofar as it relates to factual matters, upon a certificate or representations
by, an officer or officers of the Company stating that the information with
respect to such factual matters is in the

 

73

 

possession of the Company, unless such counsel knows,
or in the exercise of reasonable care should know, that the certificate or
representations with respect to such matters are erroneous.

 

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

 

Upon any application or request by the Company to the Trustee to take
any action under any provision of this Indenture, the Company shall furnish to
the Trustee an Officers’ Certificate stating that all conditions precedent, if
any, provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
Counsel all such conditions precedent, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate
or opinion need be furnished.

 

Section 13.06                 Statements Required in Certificate
or Opinion.

 

Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture shall include:

 

(a)   a statement that
each individual signing such certificate or opinion on behalf of the Company
has read such covenant or condition and the definitions herein relating
thereto;

 

(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 each such individual, he has made such examination or
investigation as is necessary to enable him to express an informed opinion as
to whether or not such covenant or condition has been complied with; and

 

(d)   a statement as to
whether, in the opinion of each such individual, such condition or covenant has
been complied with.

 

Section 13.07                 Effect of Headings and Table of
Contents.

 

The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.

 

Section 13.08                 Successors and Assigns.

 

All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.

 

74

 

Section 13.09                 Separability Clause.

 

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

 

Section 13.10                 Benefits of Indenture.

 

Nothing contained in this Indenture or in the Securities, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder, the holders of Senior Debt and the Holders of Securities,
any benefit or legal or equitable right, remedy or claim under this Indenture.

 

Section 13.11                 Governing Law.

 

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

 

Section 13.12                 Counterparts.

 

This instrument may be executed in any number of counterparts, each of
which when so executed shall be deemed to be an original but all such
counterparts shall together constitute but one and the same instrument.

 

Section 13.13                 Legal Holidays.

 

In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security or the last day on which a Holder of a Security has a
right to convert such Security shall not be a Business Day at any place of
payment or place of conversion, then (notwithstanding any other provision of this
Indenture or of the Securities) payment of interest or principal or premium, if
any, or conversion of the Securities, need not be made at such place of payment
or place of conversion on such day, but may be made on the next succeeding
Business Day at such place of payment or place of conversion with the same
force and effect as if made on the Interest Payment Date or redemption date or
at the Stated Maturity or on such last day for conversion, provided, that in
the case that payment is made on such succeeding Business Day, no interest
shall accrue on the amount so payable for the period from and after such
Interest Payment Date, Redemption Date or Stated Maturity, as the case may be.

 

Section 13.14                 Recourse Against Others.

 

No recourse for the payment of the principal of or premium, if any, or
interest on any Security, or for any claim based thereon or otherwise in
respect thereof, shall be had against any incorporator, shareholder, officer or
director, as such, past, present or future, of the Company or of any successor
corporation, whether by virtue of any constitution, statute or rule of law
or by the enforcement of any assessment or penalty or otherwise, all such
liability being, by the acceptance thereof and as part of the consideration for
the issue thereof, expressly waived and released.

 

75

 

Section 13.15                 Calculations in Respect of
Securities.

 

Except as explicitly stated herein, the Company will be responsible for
making all calculations required pursuant to this Indenture, including, without
limitation, calculations with respect to determinations of the Conversion Price
and Conversion Rate. The Company shall make all such calculations in good faith
and, absent manifest error, the Company’s calculations shall be binding on the
Holders. The Company shall provide a written schedule of such calculations to
the Trustee, and the Trustee shall be entitled to rely upon the accuracy of the
Company’s calculations without responsibility for independent verification
thereof. The Trustee shall forward a copy of such calculations to any Holder
upon such Holder’s written request.

 

Section 13.16                 No Security Interest Created.

 

Nothing in this Indenture or in the Securities,
express or implied, shall be construed to constitute a security interest under
the Uniform Commercial Code or similar legislation, now in effect or hereafter
enacted and made effective, in any jurisdiction.

 

[SIGNATURE
PAGE FOLLOWS]

 

76

 

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

 

	
   

  	
  VERTEX PHARMACEUTICALS INCORPORATED

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth S. Boger

  
	
   

  	
   

  	
  Name: Kenneth S. Boger

  
	
   

  	
   

  	
  Title: Senior Vice President and

  
	
   

  	
   

  	
            General
  Counsel

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  U.S. BANK NATIONAL

  ASSOCIATION, AS TRUSTEE

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Andrew M. Sinasky

  
	
   

  	
   

  	
  Name: Andrew M. Sinasky

  
	
   

  	
   

  	
  Title: Vice President

  

 

 

EXHIBIT A

[FORM OF FACE OF SECURITY]

 

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

 

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

 

A-1

 

VERTEX PHARMACEUTICALS
INCORPORATED

 

4.75% Convertible Senior Subordinated Notes due 2013

 

CUSIP NO. 92532F AM2

 

	
  No.

  	
  $     

  

 

VERTEX PHARMACEUTICALS INCORPORATED, a Massachusetts corporation (the “Company”,
which term includes any successor corporation under the Indenture hereinafter referred
to), for value received, hereby promises to pay to Cede & Co., or its
registered assigns, the principal sum of  
U.S. Dollars ($) on February 15, 2013.

 

Interest Payment Dates:  February 15
and August 15, commencing August 15, 2008.

 

Regular Record Dates:  February 1
and August 1.

 

Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.

 

[SIGNATURE
PAGE FOLLOWS]

 

1

 

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

 

Dated: February 19,
2008

 

 

	
   

  	
  VERTEX PHARMACEUTICALS INCORPORATED

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name: Ian F. Smith

  
	
   

  	
   

  	
  Title: Executive Vice President and

  
	
   

  	
   

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name: Kenneth S. Boger

  
	
   

  	
   

  	
  Title: Senior Vice President and

  
	
   

  	
   

  	
           General
  Counsel

  

 

 

Trustee’s
Certificate of Authentication

 

This
is one of the 4.75% Convertible Senior Subordinated Notes due 2013 described in
the within-named Indenture.

 

	
  U.S. BANK NATIONAL ASSOCIATION,

  
	
        as Trustee

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
      Authorized
  Signatory

  
	
   

  
	
  Dated:
  February 19, 2008

  

 

2

 

[FORM OF REVERSE
SIDE OF SECURITY]

 

VERTEX PHARMACEUTICALS
INCORPORATED

 

4.75% Convertible Senior Subordinated Notes due 2013

 

1.             INTEREST

 

The Company promises to pay interest on the principal amount of this
Security at the rate of 4.75% per annum. The Company shall pay interest
semi-annually in arrears on February 15 and August 15 of each year
(each, an “Interest Payment Date”),
commencing on August 15, 2008. Interest on the Securities shall accrue
from the most recent date to which interest has been paid or, if no interest
has been paid, from August 15, 2008. Interest will be computed on the
basis of a 360-day year composed of twelve 30-day months.

 

If the Company redeems this Security pursuant to Section 5 of this
Security, on a date that is after the Regular Record Date and prior to the
corresponding Interest Payment Date, interest, including Special Interest, if
any, accrued and unpaid hereon to, but not including, the applicable Redemption
Date, will be paid to the Holder in whose name the Securities are registered as
of the close of business on the Regular Record Date immediately preceding the
applicable Redemption Date.

 

If the Holder elects to require the Company to repurchase this Security
pursuant to Section 6 of this Security, on a date that is after the
Regular Record Date and prior to the corresponding Interest Payment Date,
interest, including Special Interest, if any, accrued and unpaid hereon to, but
not including, the applicable Fundamental Change Repurchase Date, will be paid
to the Holder in whose name the Securities are registered as of the close of
business on the Regular Record Date immediately preceding the applicable
Fundamental Change Repurchase Date.

 

A Holder of any Security at the close of business on a Regular Record
Date shall be entitled to receive interest, including Special Interest, if any,
on such Security on the corresponding Interest Payment Date. A Holder of any
Security which is converted after the close of business on a Regular Record
Date and prior to the corresponding Interest Payment Date (other than any
Security whose Maturity is prior to such Interest Payment Date) shall be
entitled to receive interest, including Special Interest, if any, on the
principal amount of such Security, notwithstanding the conversion of such
Security prior to such Interest Payment Date. However, any such Holder which
surrenders any such Security for conversion during the period between the close
of business on such Regular Record Date and ending with the opening of business
on the corresponding Interest Payment Date shall be required to pay the Company
an amount equal to the interest, including Special Interest, if any, on the
principal amount of such Security so converted (but excluding any overdue
interest, including Special Interest, if any, on the principal amount of such
Security so converted that exists at the time such Holder surrenders such
Security for conversion), which is payable by the Company to such Holder on
such Interest Payment Date, at the time such Holder surrenders such Security
for conversion. Notwithstanding the foregoing, any such Holder which surrenders
for conversion any Security (a) with respect to 

 

1

 

which the Company has specified a Fundamental Change
Repurchase Date or a Redemption Date, in either case, that is after such
Regular Record Date and on or prior to the next succeeding Interest Payment
Date, or (b) after the last Regular Record Date prior to the Final
Maturity Date, in either case, shall be entitled to receive (and retain) such
interest, including Special Interest, if any, and need not pay the Company an
amount equal to the interest, including Special Interest, if any, on the
principal amount of such Security so converted at the time such Holder
surrenders such Security for conversion.

 

2.             METHOD OF PAYMENT

 

The Company shall pay interest, including Special Interest, if any, on
this Security (except defaulted interest) to the person who is the Holder of
this Security at the close of business on February 1 and August 1, as
the case may be (each, a “Regular Record
Date”) immediately preceding the related Interest Payment Date.
The Holder must surrender this Security to a Paying Agent to collect payment of
principal. The Company will pay principal and interest and Special Interest, if
any, in money of the United States that at the time of payment is legal tender
for payment of public and private debts. The Company may pay principal and
interest, including Special Interest, if any, in respect of any Certificated
Security by check or wire transfer payable in such money; provided, however,
that a Holder with an aggregate principal amount in excess of $5,000,000 will
be paid by wire transfer in immediately available funds at the election of such
Holder if such Holder has provided wire transfer instructions to the Trustee at
least 10 Business Days prior to the Interest Payment Date. The Company may mail
an interest check to the Holder’s registered address. Notwithstanding the
foregoing, so long as this Security is registered in the name of a Depositary
or its nominee, all payments hereon shall be made by wire transfer of
immediately available funds to the account of the Depositary or its nominee.

 

Any wire transfer instructions received by the Trustee will remain in
effect until revoked by the Holder.

 

3.             PAYING AGENT,
REGISTRAR AND CONVERSION AGENT

 

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

 

4.             INDENTURE,
LIMITATIONS

 

This Security is one of a duly authorized issue of Securities of the
Company designated as its 4.75% Convertible Senior Subordinated Notes Due 2013
(the “Securities”), issued
under an Indenture dated as of February 19, 2008 (the “Indenture”), between the Company and
the Trustee. The terms of this Security include those stated in the Indenture
and those required by or made part of the Indenture by reference to the TIA, as
in effect on the date of the Indenture. This Security is subject to all such
terms, and the Holder of this Security is referred to the Indenture and TIA for
a statement of them.

 

2

 

The Securities are a series of senior subordinated unsecured
obligations of the Company limited to $287,500,000 in aggregate principal
amount at maturity. The Indenture does not limit the incurrence of other debt
of the Company or its existing or future Subsidiaries, secured or unsecured.

 

5.             OPTIONAL REDEMPTION.

 

Prior to February 15, 2010, the Company cannot redeem the
Securities.  The Company may, on or after
February 15, 2010, at its option, redeem the Securities in whole or in
part on any date from time to time, upon notice to the Holders as provided in
the Indenture, at a redemption prices set forth below, plus accrued and unpaid
interest, if any, to but excluding the Redemption Date.

 

	
  Year

  	
   

  	
  Redemption

  Price

  	
   

  
	
  February 15,
  2010

  	
   

  	
  102.85

  	
  %

  
	
  February 15,
  2011

  	
   

  	
  101.90

  	
  %

  
	
  February 15,
  2012

  	
   

  	
  100.95

  	
  %

  

 

If fewer than all the Securities are to be redeemed, the Trustee shall
select the particular Securities to be redeemed from the outstanding Securities
by the methods as provided in the Indenture. 
If any Security selected for partial redemption is converted in part
before termination of the conversion right with respect to the portion of the
Security so selected, the converted portion of such Security shall be deemed to
be the portion selected for redemption (provided, however, that the Holder of
such Security so converted and deemed redeemed shall not be entitled to any
additional interest payment as a result of such deemed redemption than such
Holder would have otherwise been entitled to receive upon conversion of such
Security).  Securities which have been
converted during a selection of Securities to be redeemed may be treated by the
Trustee as Outstanding for the purpose of such selection.

 

On and after the Redemption Date, interest ceases to accrue on
Securities or portions of Securities called for redemption, unless the Company
defaults in the payment of the redemption price and accrued and unpaid
interest.

 

6.             PURCHASE OF
SECURITIES AT OPTION OF HOLDER UPON A FUNDAMENTAL CHANGE

 

If a Fundamental Change occurs, at the option of the Holder and subject
to the terms and conditions of the Indenture, the Company shall become
obligated to purchase for cash, subject to certain exceptions described in the
Indenture all or any part specified by the Holder (so long as the principal
amount of such part is $1,000 or an integral multiple of $1,000) of the
Securities held by such Holder on a date specified by the Company that is no
later than 30 days after the date of the Fundamental Change Company Notice, at
a purchase price equal to 100% of the principal amount thereof together with
unpaid interest, including Special Interest, if any, accrued to, but excluding,
the Fundamental Change Repurchase Date. A Fundamental Change Company

 

3

 

Notice shall be given by the Company to the Holders as provided in the
Indenture. To exercise such repurchase right, a Holder must deliver to the
Trustee a Fundamental Change Repurchase Notice as provided in the Indenture.

 

7.             CONVERSION

 

Subject to and upon compliance with the provisions of the Indenture, a
Holder may surrender for conversion any Security that is $1,000 principal
amount or integral multiples thereof.

 

Subject to certain conditions provided for in the Indenture, in certain
circumstances, a Holder may receive an amount in Common Stock equal to the
Make-Whole Premium, in addition to the shares of Common Stock issuable upon
conversion of such Security.

 

The Conversion Rate shall be initially equal to 43.2171 shares of
Common Stock per $1,000 principal amount of Securities. The Conversion Rate
shall be adjusted under certain circumstances as provided in the Indenture.

 

No fractional share of Common Stock shall be issued upon conversion of
a Security. Instead, the Company shall pay a cash adjustment as provided in the
Indenture.

 

8.             SUBORDINATION

 

The Indebtedness evidenced by this Security is, to the extent and in
the manner provided in the Indenture, subordinated and subject in right of
payment to the prior payment in full of all amounts then due on all Senior Debt
of the Company; provided, however, that the Securities, the
Indebtedness represented thereby and the payment of the principal of and
premium, if any, and interest on the Securities in all respects shall rank
equally with, or prior to, all existing and future Indebtedness of the Company
that is expressly subordinated to any Senior Debt, and this Security is issued
subject to such provisions of the Indenture with respect thereto. Each Holder
of this Security, by accepting the same, (a) agrees to and shall be bound
by such provisions, (b) authorizes and directs the Trustee on such Holder’s
behalf to take such action as may be necessary or appropriate to effectuate the
subordination so provided, and (c) appoints the Trustee such Holder’s attorney-in-fact
for any and all such purposes.

 

9.             DENOMINATIONS, TRANSFER, EXCHANGE

 

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

 

10.           PERSONS DEEMED OWNERS

 

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

 

4

 

11.           UNCLAIMED MONEY

 

If money for the payment of principal or interest, including Special
Interest, if any, remains unclaimed for two years, the Trustee and any Paying
Agent will pay the money back to the Company at its written request, subject to
applicable unclaimed property law and the provisions of the Indenture. After
that, Holders entitled to money must look to the Company for payment as general
creditors unless an applicable abandoned property law designates another
person.

 

12.           DISCHARGE PRIOR TO MATURITY.

 

Subject to certain conditions contained in the Indenture, the Company
may discharge its obligations under the Securities and the Indenture if (1) all
of the Securities then outstanding shall become due and payable at their
scheduled Maturity within one year, and (2) the Company shall have
deposited with the Trustee money and/or U.S. Government Obligations sufficient
to pay the principal of, and premium, if any, and interest, including Special
Interest, if any, on all of the outstanding Securities on the date of Maturity.

 

13.           AMENDMENT, SUPPLEMENT AND WAIVER

 

The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities under the Indenture at any
time by the Company and the Trustee with the consent of the Holders of a
majority in aggregate principal amount of the Securities then outstanding (or
such lesser amount as shall have acted at a meeting pursuant to the provisions
of the Indenture). The Indenture also contains provisions permitting the
Holders of specified percentages in principal amount of the Securities at the
time outstanding, on behalf of the Holders of all the Securities, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security or
such other Security.

 

No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of and premium, if any, and
interest, including Special Interest, if any, on this Security at the times,
places and rate, and in the coin or currency, herein prescribed or to convert
this Security as provided in the Indenture.

 

14.           SUCCESSOR ENTITY

 

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

 

5

 

15.           DEFAULTS AND REMEDIES

 

Under the Indenture, an Event of Default shall occur if:

 

(a)  the Company shall fail to pay when due the principal,
Redemption Price or any Fundamental Change Repurchase Price of any Security,
including any Make-Whole Premium, when the same becomes due and payable whether
at the Final Maturity Date, upon repurchase, redemption, acceleration or
otherwise whether or not such payment is prohibited by Article 5 of the
Indenture; or

 

(b)  the Company shall fail to pay an installment of interest,
including Special Interest, if any, on any of the Securities, which failure
continues for 30 days after the date when due whether or not such payment is
prohibited by Article 5 hereof; or

 

(c)  the Company shall fail to deliver when due all shares of
Common Stock, together with cash instead of fractional shares deliverable upon
conversion of the Securities, which failure continues for 10 days; or

 

(d)  the Company fails to perform or observe any other term,
covenant or agreement contained in the Securities or the Indenture and the
failure continues for a period of 60 days after written notice of such failure,
requiring the Company to remedy the same, shall have been given to the Company
by the Trustee or to the Company and the Trustee by the Holders of at least 25%
in aggregate principal amount of the then-outstanding Securities; or

 

(e)  (i) the Company fails to make any payment by the end of
the applicable grace period, if any, after the maturity of any Indebtedness for
borrowed money in an amount in excess of $5,000,000, or (ii) there is an
acceleration of any Indebtedness for borrowed money in an amount in excess of
$5,000,000 because of a default with respect to such Indebtedness without such
Indebtedness having been discharged or such acceleration having been cured,
waived, rescinded or annulled, in the case of either (i) or (ii) above,
for a period of 30 days after written notice to the Company by the Trustee or
to the Company and the Trustee by Holders of at least 25% in aggregate
principal amount of the then-outstanding Securities; or

 

(f)  the Company fails to provide a Fundamental Change Company
Notice in accordance with Section 3.08 of the Indenture; or

 

(g)  certain events of bankruptcy, insolvency or reorganization as
specified in the Indenture.

 

If an Event of Default shall occur and be continuing, the principal of
all the Securities may be declared due and payable in the manner and with the
effect provided in the Indenture.

 

Notwithstanding the foregoing or anything to the contrary set forth in
the Indenture, to the extent elected by the Company, the sole remedy for an
Event of Default relating to the failure to comply with the reporting
obligations set forth in Section 6.05 of the Indenture and for any failure
to comply with the requirements of Section 314(a)(1) of the Trust
Indenture Act will for the first 180 days after the occurrence of such an Event
of Default consist exclusively of the right to receive special interest on the
Securities at an annual rate equal to 1.0% of the principal amount of the Securities
(“Special Interest”). The
Special Interest will accrue on all outstanding Securities from and including
the date on which an Event of Default relating to a failure to 

 

6

 

comply with the reporting obligations set forth in Section 6.05 of
the Indenture first occurs to but not including the 180th day thereafter (or
such earlier date on which the Event of Default shall have been cured or
waived). On such 180th day (or earlier, if the Event of Default relating to the
reporting obligations is cured or waived prior to such 180th day), such Special
Interest will cease to accrue and, if the Event of Default relating to
reporting obligations has not been cured or waived prior to such 180th day, the
Securities will be subject to acceleration as provided for in Section 8.02
of the Indenture. In the event the Company does not elect to pay Special
Interest upon an Event of Default in accordance with this paragraph, the
Securities will be subject to acceleration as provided for above. If the
Company elects to pay Special Interest as the sole remedy for an Event of
Default relating to the failure to comply with reporting obligations in Section 6.05
of the Indenture or for any failure to comply with the requirements of Section 314(a)(1) of
the TIA in, the Company will notify all Holders, the Trustee and Paying Agent
of such election on or before the close of business on the date on which such
Event of Default first occurs.

 

16.           NO RECOURSE AGAINST OTHERS

 

A director, officer, employee or shareholder, as such, of the Company
shall not have any liability for any obligations of the Company under the
Securities or the Indenture nor for any claim based on, in respect of or by
reason of such obligations or their creation. The Holder of this Security by
accepting this Security waives and releases all such liability. The waiver and
release are part of the consideration for the issuance of this Security.

 

17.           AUTHENTICATION

 

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

 

18.           ABBREVIATIONS AND DEFINITIONS

 

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

 

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

 

19.           CUSIP NUMBERS.

 

Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused CUSIP numbers to be
printed on this Security. No representation is made as to the accuracy of such
numbers either as printed on this Security and reliance may be placed only on
the other identification numbers placed thereon.

 

7

 

20.           INDENTURE TO CONTROL; GOVERNING LAW

 

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

 

The Company will furnish to any Holder, upon written request and
without charge, a copy of the Indenture. Requests may be made to: Vertex
Pharmaceuticals Incorporated, 130 Waverly Street, Cambridge, MA  02139 Attention:  Investor Relations.

 

8

 

ASSIGNMENT FORM

 

To
assign this Security, fill in the form below:

 

	
  I or we assign and transfer this Security to

  
	
   

  
	
   

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

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

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

  
	
   

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

  

 

 

	
  Date:

  	
   

  	
   

  	
  Your Signature:

  	
   

  
	
   

  	
   

  	
   

  	
  (Sign exactly as your
  name appears on the

  other side of this Security)

  

 

 

*Signature
guaranteed by:

 

	
  By:

  	
   

  	
   

  

 

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

 

1

 

CONVERSION NOTICE

 

To convert this Security,
check the box:

o

 

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

 

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

  
	
   

  
	
   

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

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

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

  
	
   

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

  

 

 

	
  Date:

  	
   

  	
   

  	
  Your Signature:

  	
   

  
	
   

  	
   

  	
  (Sign exactly as your
  name appears on the

  other side of this Security)

  

 

 

*Signature
guaranteed by:

 

	
  By:

  	
   

  	
   

  

 

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

 

1

 

FUNDAMENTAL CHANGE
REPURCHASE NOTICE

 

TO:  VERTEX
PHARMACEUTICALS INCORPORATED

130 Waverly Street

Cambridge,
Massachusetts  02139

 

The undersigned registered owner of this Security hereby irrevocably
acknowledges receipt of a notice from VERTEX
PHARMACEUTICALS INCORPORATED (the “Company”) as to the occurrence of a Fundamental Change
with respect to the Company and requests and instructs the Company to purchase
the entire principal amount of this Security, or the portion thereof (which is
$1,000 or an integral multiple thereof) below designated, in accordance with
the terms of the Indenture referred to in this Security at the Fundamental
Change Repurchase Price to the registered Holder hereof.

 

	
  Date:

  	
   

  	
   

  	
  Your Signature:

  	
   

  

 

 

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

  
	
   

  
	
   

  
	
  Signature Guaranty

  

 

 

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

 

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

 

1

 

SCHEDULE OF EXCHANGES OF
SECURITIES

 

The following exchanges, purchase, repurchases, redemption or conversions
of a part of this Global Security have been made:

 

	
  Date of Exchange

  	
   

  	
  Amount of

  Decrease in

  Principal

  Amount of this

  Security

  	
   

  	
  Amount of

  Increase in

  Principal

  Amount of this

  Security

  	
   

  	
  Principal

  Amount of this

  Global Security

  following Each

  Increase of

  Decrease

  	
   

  	
  Signature of

  Authorized

  Officer of

  Trustee

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

1EXHIBIT (10)S

 

2008 NAMED EXECUTIVE OFFICER

SUMMARY OF BASE SALARY, BONUS AWARD
OPPORTUNITIES,

AND EXECUTIVE
BENEFITS AND PERQUISITES

 

Base
Salary

 

The table below sets forth the base salaries established for the 2008
fiscal year for the Company’s Principal Executive Officer and Principal
Financial Officer and the next three most-highly compensated executive officers
who were serving in those capacities at December 31, 2007 (the “NEOs”).

 

	
  Name and Principal Position

  	
   

  	
  Amount

  	
   

  
	
  Douglas M. Baker, Jr. 

  Chairman
  of the Board, President and 

  Chief
  Executive Officer

  	
   

  	
  $

  	
  1,000,000

  	
   

  
	
  Steven L. Fritze 

  Chief
  Financial Officer

  	
   

  	
  $

  	
  475,000

  	
   

  
	
  James A. Miller 

  President
  Institutional 

  North
  America Sector

  	
   

  	
  $

  	
  425,000

  	
   

  
	
  Thomas W. Handley 

  President
  Industrial and Services 

  North
  America Sector

  	
   

  	
  $

  	
  400,000

  	
   

  
	
  Lawrence T. Bell 

  General
  Counsel and Secretary

  	
   

  	
  $

  	
  375,000

  	
   

  

 

Bonus Award Opportunities

 

The Company maintains annual cash incentive
programs for executives referred to as the Management Incentive Plan or MIP and
Management Performance Incentive Plan or MPIP. 
The Company’s stockholders approved the current version of the MPIP in
2004, an annual incentive plan under which awards should qualify as performance
based under Internal Revenue Code Section 162(m).  On February 20, 2008, as required under
the terms of the MPIP, the Compensation Committee of the Board (“Committee”)
selected each of the NEOs to participate in the MPIP for 2008 and established
the 2008 performance goal based upon the performance criteria of diluted earnings
per share (“EPS”), and EPS performance target of a designated earnings per
share, and a cash award of 300% of the base salary of each such officer for
2008 to the extent the goal is achieved. 
The award is subject to and interpreted in accordance with the terms and
conditions of the MPIP and no amount will be paid under the MPIP unless and
until the Committee has determined the extent to which the performance goal has
been met and the corresponding amount of the award earned by the participant.  The MPIP permits the Committee to exercise
downward discretion so as to pay an amount which is less than the amount of the
award earned by the participant.  In
applying this downward discretion, the Committee considers underlying operable
metrics communicated to the participant, which are noted in the table
below.  Although the chart below
indicates a threshold payment, a named executive officer may receive no payment
as determined by results and approved by the Committee.

 

 

	
  Name

  	
   

  	
  Target

  Award

  Opportunity

  (% of base

  salary)

  	
   

  	
  Potential Award Payouts at Different

  Levels of Performance

  (% of Target Award)

  	
   

  	
  Performance Measure Mix

  	
   

  
	
   

  	
  Threshold

  	
   

  	
  Target

  	
   

  	
  Max

  	
   

  	
  EPS

  	
   

  	
  Business

   Unit

  	
   

  	
  Individual

  	
   

  
	
  Douglas
  M. Baker, Jr.

  	
   

  	
  110%

  	
   

  	
  40%

  	
   

  	
  100%

  	
   

  	
  200%

  	
   

  	
  100%

  	
   

  	
    0%

  	
   

  	
    0%

  	
   

  
	
  Steven
  L. Fritze

  	
   

  	
    70%

  	
   

  	
  40%

  	
   

  	
  100%

  	
   

  	
  200%

  	
   

  	
    70%

  	
   

  	
    0%

  	
   

  	
  30%

  	
   

  
	
  James
  A. Miller

  	
   

  	
    70%

  	
   

  	
  40%

  	
   

  	
  100%

  	
   

  	
  200%

  	
   

  	
    30%

  	
   

  	
  70%

  	
   

  	
    0%

  	
   

  
	
  Lawrence
  T. Bell

  	
   

  	
    60%

  	
   

  	
  40%

  	
   

  	
  100%

  	
   

  	
  200%

  	
   

  	
    70%

  	
   

  	
    0%

  	
   

  	
  30%

  	
   

  
	
  Thomas
  W. Handley

  	
   

  	
    70%

  	
   

  	
  40%

  	
   

  	
  100%

  	
   

  	
  200%

  	
   

  	
    30%

  	
   

  	
  70%

  	
   

  	
    0%

  	
   

  

 

Executive Benefits and
Perquisites

 

The following table
sets forth the executive benefits and perquisites made available by the Company
to the NEOs for the 2008 fiscal year.

 

	
   Executive Benefit or Perquisite

   	
    

   	
   Description

   
	
  Physical Examination

  	
   

  	
  ·      Annual
  reimbursement not to exceed $3,000

  
	
   

  	
   

  	
   

  
	
  Mirror Savings and Pension Plan

  	
   

  	
  ·      Nonqualified
  ERISA excess benefit plans intended to restore benefits limited by law under
  the tax-qualified savings and pension plans

  ·      Executives
  may also elect to defer up to 25% of base salary and annual bonus, subject to
  the same investment alternatives (with the exception of the Ecolab Stock Fund)
  and returns as under the tax-qualified savings plan 

  
	
   

  	
   

  	
   

  
	
  Supplemental Executive Retirement Plan

  	
   

  	
  ·      Maximum
  annual benefit of 60% of highest five consecutive years of base salary and
  annual bonus (offset by other qualified and nonqualified pension benefits)

  ·      Provides
  past service credit

  
	
   

  	
   

  	
   

  
	
  Post-Retirement Death Benefit

  	
   

  	
  ·      Two
  times final average pay

  
	
   

  	
   

  	
   

  
	
  Executive Life, Accidental Death and Dismemberment and Business Travel
  Accident Insurance

  	
   

  	
  ·      Each
  are three times annual compensation for the preceding year

  
	
   

  	
   

  	
   

  
	
  Long-Term Disability Insurance

  	
   

  	
  ·      60%
  of compensation, less the amount of the qualified benefit

  
	
   

  	
   

  	
   

  
	
  Company Automobile

  	
   

  	
  ·      Allowance
  to replace prior executive company automobile lease program at same value

  
	
   

  	
   

  	
   

  
	
  Financial Counseling

  	
   

  	
  ·      Up
  to five percent of base salary plus unused amounts for the prior two years
  for principal executive officer

  ·      Up
  to three percent of base salary plus unused amounts for the prior two years
  for other named executive officers

  
	
   

  	
   

  	
   

  
	
  Club Memberships

  	
   

  	
  ·      Limited
  to principal executive officer

  
	
   

  	
   

  	
   

  
	
  Private Aircraft Usage

  	
   

  	
  ·      Limited
  to principal executive officer

  
	
   

  	
   

  	
  (Not used in 2007)

  
	
   

  	
   

  	
   

  
	
  Spousal Travel

  	
   

  	
  ·      Only
  when related to a business purpose

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00136-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00136-of-00352.parquet"}]]