Document:

exv4w1

 

EXHIBIT 4.1

EXECUTION VERSION

FORD MOTOR COMPANY

AND

THE BANK OF NEW YORK

as Trustee

 

FIRST SUPPLEMENTAL INDENTURE

Dated as of December 15, 2006

 

Creating a Series of Securities Designated

4.25% Senior Convertible Notes due 2036

 

 

          FIRST SUPPLEMENTAL INDENTURE, dated as of December 15, 2006, between FORD MOTOR COMPANY, a
corporation duly organized and existing under the laws of the State of Delaware (hereinafter
sometimes called the “Company”), and THE BANK OF NEW YORK (as successor trustee to JPMorgan Chase
Bank), a corporation duly organized and existing under the laws of the State of New York, as
trustee (hereinafter sometimes called the “Trustee”).

RECITALS OF THE COMPANY

          WHEREAS, the Company and the Trustee have duly executed and delivered an Indenture, dated as
of January 30, 2002 (such indenture is hereinafter called the “Indenture”), providing for the
issuance from time to time of unsecured and senior or subordinated debentures, notes or other
evidences of indebtedness, which may be convertible into or exchangeable for any securities of any
person (including the Company), to be issued in one or more series by the Company (the
“Securities”);

          WHEREAS, pursuant to the terms of the Indenture, the Company desires to provide for the
establishment of a new series of Securities known as its 4.25% Senior Convertible Notes due 2036
(the “Notes”) to be issued under the Indenture initially in an aggregate principal amount of up to
$4,950,000,000, which may be authenticated and delivered as provided in the Indenture;

          WHEREAS, the Company desires to supplement the provisions of the Indenture to provide for the
issuance of the Notes under the terms of the Indenture as supplemented hereby;

          WHEREAS, Section 9.01 of the Indenture expressly permits the Company and the Trustee to enter
into one or more indentures supplemental thereto for the purpose of establishing the form or terms
of Notes to be issued under the Indenture without the consent of the Holders of any Outstanding
Securities;

          WHEREAS, for the purposes hereinabove recited, and pursuant to due corporate action, the
Company has duly determined to execute and deliver to the Trustee the First Supplemental Indenture;
and

          WHEREAS, all conditions and requirements necessary to make the First Supplemental Indenture a
valid, legal and binding instrument in accordance with its terms have been done and performed, and
the execution and delivery hereof have been in all respects duly authorized.

          NOW, THEREFORE, in consideration of the premises, the Company and the Trustee mutually
covenant and agree as follows:

 

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ARTICLE ONE

Definitions

     Section 1.01. All terms contained in the First Supplemental Indenture shall, except as
specifically provided herein or except as the context may otherwise require, have the meanings
given to such terms in the Indenture. In the event of any inconsistency between the Indenture and
the First Supplemental Indenture, the First Supplemental Indenture shall govern. The words
“herein,” “hereof,” “hereunder,” and words of similar import shall refer to the First Supplemental
Indenture.

     Section 1.02. Solely with respect to the Notes, the following definitions shall be added to
Section 1.01 of the Indenture and replace any existing definitions (as applicable) in the
Indenture, each in appropriate alphabetical order. Unless the context otherwise requires, the
following terms shall have the following meanings:

          “Applicable Price” means, in connection with a Designated Event, (1) if the consideration paid
to holders of Common Stock in connection with such transaction consists exclusively of Cash, the
amount of such Cash per share of Common Stock, and (2) in all other cases, the average of the
Closing Sale Prices of Common Stock for the five consecutive Trading Days immediately preceding the
Effective Date of such Designated Event.

          “Applicable Settlement Value” means, with respect to shares of common stock, par value $0.01
per share, of the Company (as subdivided, combined or reclassified), the greater of (1) the average
of the Closing Sale Prices per share of such common stock for the five consecutive Trading Days
immediately preceding the Purchase Date multiplied by 99% or (2) $4.91 per share of such common
stock (subject to adjustment on any date on which the Conversion Rate of the Notes is adjusted. The
adjusted amount shall equal the amount immediately prior to such adjustment multiplied by a
fraction the numerator of which is the Conversion Rate in effect immediately prior to such
adjustment and the denominator of which is the Conversion Rate immediately following such
adjustment.) In the case of a Designated Event in which the shares of Common Stock have been, as
of the Effective Date, converted into or exchanged for the right to receive other securities, the
“Applicable Settlement Value” per security or per other unit shall be calculated as follows:

     (i) for securities that are traded on a U.S. national securities exchange or the NASDAQ
Global Market or other similar market, the average of the Closing Sale Prices per security
of such securities for the five consecutive Trading Days immediately preceding the Purchase
Date, or

     (ii) for other consideration that Holders will have the right to receive, the value per
security or per other unit determined by the Company’s Board of Directors in good faith.

          “Business Day” means any day other than a Saturday or Sunday or other than a day on which
banking institutions in New York, New York are authorized or obligated by law or executive order to
close.

 

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          “Capital Stock” means any and all shares, interests, participations or other equivalents
(however designated) of capital stock of the Company and all warrants or options to acquire such
capital stock.

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

          “Cash Amount” has the meaning set forth in Section 5.04(c)(iii) of the First Supplemental
Indenture.

          “Cash Settlement Averaging Period” has the meaning set forth in Section 5.04(c)(ii)(B) of the
First Supplemental Indenture.

          “Change in Control” means either of the following:

     (i) more than 50% of the voting power of the Company’s Voting Stock being held by a
Person or Persons (other than Permitted Holders) who “act as a partnership, limited
partnership, syndicate or other group for the purpose of acquiring, holding or disposing of
securities” of the Company (within the meaning of Section 13(d)(3) of the Securities and
Exchange Act of 1934 (the “Exchange Act”)); or

     (ii) Continuing Directors cease to constitute at least a majority of the Company’s
Board of Directors.

          “Close of Business” means 5:00 p.m. New York City time.

          “Closing Sale Price” means, as of any date, the last reported per share sales price of a share
of Common Stock or any other security on such date (or, if no last sale price is reported, the
average of the bid and ask prices or, if more than one in either case, the average of the average
bid and the average ask prices) on such date as reported on The New York Stock Exchange, or if the
Common Stock or such other security is not listed on The New York Stock Exchange, as reported by
the principal U.S. exchange or quotation system on which the Common Stock or such other security is
then listed or quoted; provided, however, that in the absence of such quotations, the Board of
Directors will make a good faith determination of the Closing Sale Price.

If during a period applicable for calculating Closing Sale Price, an issuance, distribution,
subdivision, combination or other transaction or event occurs that requires an adjustment to the
Conversion Rate pursuant to Section 5.09 of the First Supplemental Indenture, Closing Sale Price
shall be calculated for such period in a manner determined by the Company to appropriately reflect
the impact of such issuance, distribution, subdivision or combination on the price of the Common
Stock during such period.

          “Common Stock” means the common stock, par value $0.01 per share, of the Company, or such
other capital stock into which the Company’s common stock is reclassified or changed. For the
avoidance of doubt, the term “Common Stock” shall not include the Class B Stock, par value $0.01
per share, of the Company.

          “Continuing Director” means at any date, an individual (a) who is a member of the Board of
Directors of the Company on the date of the First Supplemental Indenture, (b) who has been elected
as a member of the Board of Directors with a majority of the total votes of

 

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Permitted Holders that were cast in such election voted in favor of such member or (c) who has
been nominated to be a member of the Board of Directors by a majority of the other Continuing
Directors then in office.

          “Conversion Agent” means initially the Trustee or such other office or agency subsequently
designated by the Company where Notes may be presented for conversion.

          “Conversion Date” has the meaning set forth in Section 5.03(a) of the First Supplemental
Indenture.

          “Conversion Notice” has the meaning set forth in Section 5.03(a) of the First Supplemental
Indenture.

          “Conversion Obligation” has the meaning set forth in Section 5.01(e) of the First Supplemental
Indenture.

          “Conversion Price” means at any time an amount equal to $1,000 principal amount of Notes
divided by the then current Conversion Rate.

          “Conversion Rate” has the meaning set forth in Section 5.01(c) of the First Supplemental
Indenture.

          “Conversion Rights Termination Date” has the meaning set forth in Section 5.02(a) of the First
Supplemental Indenture.

          “Conversion Settlement Distribution” has the meaning set forth in Section 5.04(c) of the First
Supplemental Indenture.

          “Conversion Value” means the average of the products for each Trading Day of the Cash
Settlement Averaging Period of (i) the applicable Conversion Rate for such day multiplied by (ii)
the Closing Sale Price per share of the Common Stock on such day multiplied by (iii) the aggregate
principal amount of Notes to be converted divided by $1,000.

          “Current Market Price” means the average of the Closing Sale Prices of the Common Stock for
each of the 10 consecutive Trading Days ending on the earlier of the date in question and the day
before the Ex-Date with respect to the issuance or distribution requiring such computation.

          “Designated Event” means any of the following:

     (i) more than 50% of the voting power of the Company’s Voting Stock being held by a
Person or Persons (other than Permitted Holders) who “act as a partnership, limited
partnership, syndicate or other group for the purpose of acquiring, holding or disposing of
securities” of the Company (within the meaning of Section 13(d)(3) of the Exchange Act);

     (ii) more than 50% of the voting power of the Company’s Voting Stock being held by a
Person or Persons who “act as a partnership, limited partnership, syndicate or other group
for the purpose of acquiring, holding or disposing of securities” of the Company (within the
meaning of Section 13(d)(3) of the Exchange Act), where such Person or Persons are Permitted
Holders, resulting in the Common Stock (or other securities or property into which the Notes
are then convertible) no longer being listed or approved for trading on The New York Stock
Exchange or listed or approved for trading

 

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or quoted on the NASDAQ Global Market or on any other U.S. national securities exchange or
other similar market; or

     (iii) the Company consolidates or merges with or into another Person (other than a
subsidiary of the Company), or conveys, sells, transfers or leases all or substantially all
of the Company’s assets to another Person (other than a subsidiary of the Company), or any
Person (other than a subsidiary of the Company) merges into or consolidates with the
Company, and the Company’s outstanding Common Stock is reclassified into, converted for or
converted into the right to receive any property or security, provided that no such
transaction shall constitute a Designated Event if Persons that beneficially own (as
determined in accordance with Rules 13d-3 and 13d-5 under the Exchange Act or any successor
provisions) Common Stock immediately prior to the transaction beneficially own, directly or
indirectly, common stock representing at least a majority of the voting power of all the
common stock of the surviving Person after the transaction in substantially the same
proportion as their voting power immediately prior to the transaction.

          “Effective Date” has the meaning set forth in Section 5.08(a) of the First Supplemental
Indenture.

          “Existing Debt Securities” means the senior unsecured notes of the Company issued pursuant to
the Existing Debt Indentures.

          “Existing Debt Indentures” means collectively, (a) the indenture dated as of February 15, 1992
between the Company and The Bank of New York, as trustee and (b) the Indenture, as amended.

          “Ex-Date” means, in connection with any dividend, issuance or distribution, the first date on
which the shares of Common Stock trade on the applicable exchange or in the applicable market,
regular way, without the right to receive such issuance or distribution.

          “Ex-distribution trading” means, in connection with any dividend, issuance or distribution,
the first date on which the shares of Common Stock begin trading on the applicable exchange or in
the applicable market, regular way, without the right to receive such issuance or distribution.

          “First Supplemental Indenture” means the First Supplemental Indenture, dated as of December
15, 2006, to the Indenture.

          “Make-Whole Shares” has the meaning set forth in Section 5.08(a) of the First Supplemental
Indenture.

          “NASDAQ Global Market” means collectively the NASDAQ Global Select Market and the NASDAQ
Global Market.

          “Permitted Holders” means holders of the Company’s Class B Stock on the date of the First
Supplemental Indenture and such other holders of such Class B Stock from time to time; provided
that any such holder satisfies the qualification set forth in clauses (i) through (vii) of
subsection 2.2 of Article Fourth of the Company’s restated certificate of incorporation as in
effect on the date of the First Supplemental Indenture.

 

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          “Prospectus Supplement” means the final prospectus supplement relating to the Notes, dated
December 6, 2006.

          “Purchase Date” has the meaning set forth in Section 4.01(a) of the First Supplemental
Indenture.

          “Purchase Notice” has the meaning set forth in Section 4.01(c) of the First Supplemental
Indenture.

          “Purchase Price” has the meaning set forth in Section 4.01(a) of the First Supplemental
Indenture.

          “Record Date” means, for purposes of Section 5.09 of the First Supplemental Indenture, with
respect to (a) 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 Common
Stock (or other applicable security) is exchanged for or converted into any combination of Cash,
securities or other property, the date fixed for determination of holders of Common Stock entitled
to receive such Cash, securities or other property (whether such date is fixed by the Board of
Directors or by statute, contract or otherwise) or (b) any subdivision or combination, the Business
Day immediately preceding the effective date of such subdivision or combination.

          “Repurchase Date” has the meaning set forth in Section 6.01(a) of the First Supplemental
Indenture.

          “Repurchase Notice” has the meaning set forth in Section 6.01(c) of the First Supplemental
Indenture.

          “Repurchase Price” has the meaning set forth in Section 6.01(a) of the First Supplemental
Indenture.

          “Termination Notice” has the meaning set forth in Section 5.02(a) of the First Supplemental
Indenture.

          “Trading Day” means (x) if the applicable security is listed on The New York Stock Exchange, a
day on which trades may be made thereon or (y) if the applicable security is listed or admitted for
trading on the American Stock Exchange, The Nasdaq Global Market or another national securities
exchange or market, a day on which the American Stock Exchange, The Nasdaq Global Market or another
national securities exchange or market is open for business or (z) if the applicable security is
not so listed, admitted for trading or quoted, any Business Day.

          “Voting Stock” means Capital Stock having the right to vote for the election of directors
under ordinary circumstances.

 

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     Section 1.03. Applicability. The provisions contained in the First Supplemental
Indenture shall apply only to the Notes and not to any other series of Securities issued under the
Indenture and any covenants provided herein are solely for the benefit of the Notes and not for the
benefit of any other series of Securities issued under the Indenture.

ARTICLE TWO

GENERAL TERMS AND CONDITIONS OF THE NOTES

     Section 2.01. Terms.

     Pursuant to Section 3.01 of the Indenture, the terms of the Notes shall be as follows:

          (1) The Notes shall be senior in rank, and the title of the Notes is “4.25% Senior Convertible
Notes due 2036.”

          (2) The aggregate principal amount of Notes that may be authenticated and delivered under the
Indenture is initially limited to $4,950,000,000, except for Notes authenticated and delivered upon
registration of transfer of, or exchange for, or in lieu of, other Notes pursuant to this First
Supplement Indenture. The Company may, without the consent of any Holders, reopen the Notes and
issue additional Notes with the same terms and with the same CUSIP number as the Notes initially
issued in an unlimited aggregate principal amount, which will form the same series with the Notes
initially issued so long as no Default or Event of Default has occurred and is continuing with
respect to the Notes and such additional Notes shall be fungible with the Notes initially issued
for U.S. federal income tax purposes.

          (3) The principal amount of the Notes shall be due and payable on December 15, 2036.

          (4) Interest on the Notes will accrue at the rate of 4.25% per annum, from December 15, 2006
until the principal thereof is paid or made available for payment. Interest shall be payable on
June 15 and December 15 of each year (each, an “Interest Payment Date”), commencing June 15, 2007,
to the Persons in whose name the Notes are registered at the Close of Business on the June 1 or
December 1, whether or not a Business Day, immediately preceding the relevant Interest Payment Date
(each, a “Regular Record Date”). Interest on the Notes shall be computed on the basis of a 360-day
year comprised of twelve 30-day months. If interest or principal is payable on a day that is not a
Business Day, the Company shall make the payment on the next Business Day, and no interest will
accrue as a result of the delay in payment.

          (5) The principal of and interest, if any, on the Notes shall be payable at the Corporate
Trust Office of the Trustee.

          (6) Prior to December 20, 2016, the Notes are not redeemable at the option of the Company.
Starting on December 20, 2016 and on any Business Day thereafter, in accordance with the Indenture,
including, without limitation, Article Eleven of the Indenture, and the First Supplemental
Indenture, the Company may redeem all or any portion of the Notes, for Cash, at once or from time
to time, upon at least 30 and not more than 60 days’ notice, which shall be an irrevocable notice,
at a redemption price equal to 100% of the principal amount to be redeemed, together with accrued
and unpaid interest thereon, up to, but not including, the

 

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Redemption Date (subject to the right of Holders on the relevant Regular Record Date to
receive interest due on the relevant Interest Payment Date).

          (7) (a) On December 20, 2016 and on December 15, 2026, Holders shall have the right to require
the Company to repurchase for Cash any outstanding Notes for which such Holder has properly
delivered and not withdrawn a Repurchase Notice in accordance with Article Six of the First
Supplemental Indenture.

                (b) Subject to the terms and conditions of the Indenture and the First Supplemental Indenture,
including, without limitation, Article Four of the First Supplemental Indenture, Holders shall have
the right to require the Company to repurchase any outstanding Notes for shares of Common Stock (or
such other consideration into which the shares of Common Stock have been converted or exchanged in
connection with such Designated Event) upon a Designated Event.

                (c) Subject to the terms and conditions of the Indenture and the First Supplemental Indenture,
including, without limitation, Article Four of the First Supplemental Indenture, Holders shall have
the right to require the Company to repurchase for Cash any outstanding Notes for Cash upon a
Change in Control.

          (8) The Notes are not entitled to any sinking fund or analogous reserve.

          (9) The Notes shall be issuable in denominations of $1,000 and integral multiples thereof.

          (10) The Securities Registrar, authenticating agent, Conversion Agent and Paying Agent for the
Notes shall initially be the Trustee.

          (11) Payments of principal and interest on the Notes shall be made in such coin or currency of
the United States of America as at the time of payment shall be legal tender for the payment of
public and private debts.

          (12) The Notes will be initially issued in book-entry form and represented by registered
global Notes substantially in the form attached hereto as Exhibit A, delivered to The Depository
Trust Company (the “Depositary”), or a custodian on the Depositary’s behalf, and recorded in the
book-entry system maintained by the Depositary.

          (13) From and after the Conversion Rights Termination Date, the Notes shall be subject to
defeasance in accordance with the provisions of Article Fourteen of the Indenture.

          (14) The Notes shall be convertible at the option of the Holders in accordance with the terms
and conditions set forth in Article Five of the First Supplemental Indenture.

     Section 2.02. The Notes and the Trustee’s certificate of authentication to be borne by such
Notes shall be substantially in the form set forth in Exhibit A to the First Supplemental
Indenture. The terms and provisions contained in the form of Notes attached as Exhibit A hereto
shall constitute, and are hereby expressly made, a part of the First Supplemental Indenture and, to
the extent applicable, the Company and the Trustee, by their execution and delivery of the

 

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First Supplemental Indenture, expressly agree to such terms and provisions and to be bound thereby.

ARTICLE THREE

AMENDMENTS TO INDENTURE SECTIONS

     The following amendments to the Indenture shall apply only to the Notes and not to any other
series of Securities issued under the Indenture and shall be effective for so long as any Notes
remain Outstanding. The Indenture is amended by the First Supplemental Indenture solely with
respect to the Notes, as follows:

     Section 3.01. Amendments to Article Five.

          (a) Solely with respect to the Notes, Section 5.01 of the Indenture shall be amended and
restated in its entirety by inserting the following in lieu thereof:

          “SECTION 5.01. Events of Default. “Event of Default”, wherever used in the Indenture or the
First Supplemental Indenture with respect to the Notes, shall mean any one of the following events
(whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or
be effected by operation of law or pursuant to any judgment, decree or order of any court or any
order, rule or regulation of any administrative or governmental body):

     (1) default in the payment of any interest upon any Note when it becomes due and
payable, and continuance of such default for a period of 30 days; or

     (2) default in the payment of the principal of (or premium, if any, on), Purchase
Price, Redemption Price or Repurchase Price of any Note at Maturity, and continuance of such
default for five Business Days; or

     (3) failure by the Company to provide notice of a Change of Control in accordance with
the terms of Article Four of the First Supplemental Indenture; or

     (4) default in the performance, or breach, of any covenant or warranty of the Company
in the Indenture or the First Supplemental Indenture (other than a covenant or warranty a
default in whose performance or whose breach is elsewhere in this Section specifically dealt
with or which has expressly been included in the Indenture solely for the benefit of a
series of Securities other than the Notes), and continuance of such default or breach for a
period of 90 days (subject to reduction pursuant to Section 7.03(a) of the Indenture as
amended by the First Supplemental Indenture if the 15-day period referred to therein has
been extended as provided therein) after there has been given, by registered or certified
mail, to the Company by the Trustee or to the Company and the Trustee by the Holders of at
least 25% in principal amount of the Outstanding Notes a written notice specifying such
default or breach and requiring it to be remedied and stating that such notice is a “Notice
of Default” hereunder;

 

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     (5) the entry by a court having jurisdiction in the premises of (A) a decree or order
for relief in respect of the Company in an involuntary case or proceeding under the National
Bankruptcy Act or any other similar Federal or State law or (B) a decree or order adjudging
the Company a bankrupt or insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of or in respect of the Company under
any applicable Federal or State law, or appointing a custodian, receiver, liquidator,
assignee, trustee, sequestrator or other similar official of the Company or of any
substantial part of the property of the Company, or ordering the winding up or liquidation
of the affairs of the Company, 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 90 consecutive days;
or

     (6) the commencement by the Company of a voluntary case or proceeding under the
National Bankruptcy Act or any other similar Federal or State law or of any other case or
proceeding to be adjudicated a bankrupt or insolvent, or the consent by the Company to the
entry of a decree or order for relief in respect of the Company in an involuntary case or
proceeding under the National Bankruptcy Act or any other similar Federal or State law or to
the commencement of any bankruptcy or insolvency case or proceeding against the Company, or
the filing by the Company of a petition or answer or consent seeking reorganization or
relief under any applicable Federal or State law, or the consent by the Company to the
filing of such petition or to the appointment of or taking possession by a custodian,
receiver, liquidator, assignee, trustee, sequestrator or similar official of the Company or
of any substantial part of the property of the Company, or the making by the Company of an
assignment for the benefit of creditors, or the admission by the Company in writing of its
inability to pay its debts generally as they become due; or

     (7) default in the delivery when due of all shares of Common Stock and any Cash payable
upon conversion with respect to the Notes, which default continues for 15 days.”

     (b) Solely with respect to the Notes, Section 5.02 of the Indenture shall be amended
and restated in its entirety by inserting the following in lieu thereof:

     “SECTION 5.02. Acceleration of Maturity; Rescission and Annulment. If an
Event of Default, other than pursuant to Section 5.01(5) and (6) of the Indenture, with
respect to the Notes occurs and is continuing, then in every such case the Trustee or the
Holders of not less than 25% in principal amount of the Outstanding Notes may declare the
principal amount of all of the Notes plus accrued and unpaid interest, if any, on the Notes
accrued through the date of such declaration to be due and payable immediately, by a notice
in writing to the Company (and to the Trustee if given by Holders), and upon any such
declaration such principal amount and accrued interest shall become immediately due and
payable. In the case of Events of Default occurring under Sections 5.01(5) and (6) of the
Indenture, the principal amount of the Notes plus accrued and unpaid interest, if any,
accrued thereon through the occurrence of such event shall automatically become and be
immediately due and payable.

 

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     At any time after such a declaration of acceleration with respect to the Notes has been
made or occurred and before a judgment or decree for payment of the money due has been
obtained by the Trustee as hereinafter in this Article provided, the Holders of a majority
in principal amount of the Outstanding Notes, by written notice to the Company and the
Trustee may waive all defaults and rescind and annul such declaration and its consequences
if:

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

     (A) all overdue interest on all Notes,

     (B) the principal of (and premium, if any, on) with respect to any Notes which have
become due otherwise than by such declaration of acceleration and interest thereon at the
rate or rates prescribed therefor in the Notes,

     (C) to the extent that payment of such interest is enforceable under applicable law,
interest upon overdue interest to the date of such payment or deposit at the rate or rates
prescribed therefor in the Notes or, if no such rate or rates are so prescribed, at the rate
borne by the Notes during the period of such default, and

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

     and

          (2) all Events of Default with respect to Notes, other than the non-payment of the principal
of Notes and accrued interest which have become due solely by such declaration of acceleration,
have been cured or waived as provided in Section 5.13 of the Indenture.

No such waiver or rescission and annulment shall affect any subsequent default or impair any right
consequent thereon.”

     Section 3.02. Amendment to Article Seven.

          (a) Solely with respect to the Notes, Section 7.03(a) of the Indenture shall be amended and
restated in its entirety by inserting the following text in lieu thereof:

     “(a) The Company covenants and agrees to furnish to the Trustee copies of the Company’s
annual reports on Form 10-K (or any successor form) and the Company’s quarterly reports on
Form 10-Q (or any successor form) within 15 days after the Company shall be required to file
the same with the Commission; provided that if the Company is not required to file such
reports with the Commission, then within 15 days after the Company would be required to file
these reports with the Commission if the Company had a security listed on a U.S. national
securities exchange. Such 15-day period shall automatically be extended to the earlier of
(a) the date that is five days prior to the date of the occurrence of any event of default
(or any comparable term) under any

 

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of the Company’s Existing Debt Securities (other than the Notes) as a result of the
Company’s failure to provide annual or quarterly financial statements to the extent required
under the related indenture and (b) in the case of audited annual financial statements,
within 240 days after the end of the Company’s fiscal year, and in the case of unaudited
quarterly financial statements, within 220 days after the end of the respective quarters for
each of the first three quarterly periods of each fiscal year of the Company. If the period
for filing any report is automatically extended for 85 or more days as described above, then
the 90 day cure period for the Company’s failure to comply with the Company’s obligation to
file such report shall be reduced to 5 days. If, however, in connection with an event of
default under the Company’s Existing Debt Securities (other than the Notes), the period for
filing such report is automatically extended for less than 85 days, then the number of days
in such cure period shall be reduced to equal the number by which 90 exceeds the number of
days of such extension. It is understood and agreed that failure to comply with Section
314(a) of the TIA (or any successor provision thereto) shall not constitute a default or
breach for purposes of Section 5.01(4) of the Indenture as amended by the First Supplemental
Indenture and, therefore, shall not permit Holders of Notes in such case to declare the
principal amount of the Notes to be due and payable immediately pursuant to Section 5.02 of
the Indenture as amended by the First Supplemental Indenture.”

     Section 3.03. Amendment to Article Nine.

          (a) Solely with respect to the Notes, Section 9.01(2) of the Indenture shall be amended and
restated in its entirety by replacing current clause (2) with the following text:

     “(2) to add to the covenants of the Company for the benefit of the Holders of Notes or
to surrender any right or power herein conferred upon the Company or to make other changes
which would not adversely affect the interests of the Holders of the Notes in any material
respect; or”

          (b) Solely with respect to the Notes, Section 9.01 of the Indenture shall be amended by
deleting the period following clause (10) and replacing it with “; or” and inserting the following:

          “(11) to comply with the rules of any applicable securities depositary; or

          (12) to add any guarantor with respect to the Notes.”

     (c) Solely with respect to the Notes, Section 9.01 of the Indenture shall be amended by
inserting the following immediately after new clause (12) thereof:

     “No amendment to the Indenture or the First Supplemental Indenture made solely to conform the
Indenture or the First Supplemental Indenture to the description of the Notes contained in the
Prospectus Supplement and the accompanying prospectus will be deemed to adversely affect the
interests of the Holders of Notes. Nothing in the First Supplemental Indenture shall affect the
right of the Company and the Trustee to enter into indentures supplemental to the Indenture
relating to series of Securities other than the Notes.”

 

13

          (d) Solely with respect to the Notes, Section 9.02 of the Indenture shall be amended by
replacing the first paragraph with the following:

     “With the consent of the Holders of not less than a majority in principal amount of the
Outstanding Notes, by Act of said Holders delivered to the Company and the Trustee, the
Company, when authorized by a Board Resolution, and the Trustee may, from time to time and
at any time, enter into an indenture or indentures supplemental hereto (which shall conform
to the provisions of the TIA as in force at the date of execution thereof) for the purpose
of adding any provisions to or changing in any manner or eliminating any of the provisions
of this Indenture or of any supplemental indenture or of modifying in any manner the rights
of the Holders of the Notes; provided, however, that no such supplemental
indenture shall, without the consent of each Holder of Outstanding Notes affected thereby:

	 	(i)	 	change the Stated Maturity of the principal of (or premium, if
any, on), or any installment of principal of or interest, if any, on, any Note;
	 
	 	(ii)	 	reduce the principal amount or premium, if any, payable at
Maturity or upon repurchase or redemption of any Note, or reduce the interest
rate of any Note;
	 
	 	(iii)	 	make any change that adversely affects the conversion rights
or the Conversion Rate of any Note;
	 
	 	(iv)	 	make any change that adversely affects the right of a Holder to
require the Company to repurchase any Note;
	 
	 	(v)	 	impair the right of any Holder of Outstanding Notes to convert
or receive payment of principal and interest with respect to any Note or the
right to institute suit for the enforcement of any payment with respect to, or
conversion of, any Note;
	 
	 	(vi)	 	change the place or currency of payment of principal or
interest in respect of any Note;
	 
	 	(vii)	 	change the amendment provisions which require each Holder’s
consent; or
	 
	 	(viii)	 	reduce the aforesaid percentage in principal amount of the Notes required for
any such supplemental indenture.

 

 

14

ARTICLE FOUR

OFFER TO REPURCHASE UPON A DESIGNATED EVENT OR CHANGE IN

CONTROL

     Section 4.01. Offer to Repurchase Upon a Designated Event or Change in Control.

          (a) If there shall have occurred a Designated Event or Change in Control, each Holder shall
have the right, at such Holder’s option, to require the Company to purchase all or any portion of
such Holder’s Notes not previously repurchased or called for redemption in integral multiples of
$1,000 principal amount on a date selected by the Company as specified below (the “Purchase Date”),
at a purchase price equal to 100% of the principal amount of the Notes to be purchased, plus
accrued and unpaid interest to, but not including, the Purchase Date (the “Purchase Price”),
subject to satisfaction by or on behalf of the Holder of the requirements set forth in Section
4.01(c) of the First Supplemental Indenture; provided that if the Purchase Date is after a Regular
Record Date and on or prior to the Interest Payment Date to which it relates, interest accrued to
the Interest Payment Date will be paid to Holders of the Notes as of the preceding Regular Record
Date. With respect to any event that is a Change in Control, the Company shall pay the Purchase
Price in Cash. With respect to any Designated Event that is not a Change in Control, the Company
shall pay the Purchase Price in shares of Common Stock (or such other consideration into which the
shares of Common Stock have been converted or exchanged in connection with such Designated Event)
as provided in Section 4.03(b) of the First Supplemental Indenture below.

Notwithstanding the foregoing, Holders will not have the right to require the Company to repurchase
the Notes in connection with a Designated Event or Change in Control, and the Company shall not be
required to deliver a notice of such Designated Event or Change in Control incidental thereto, if:

     (i) the Closing Sale Price of Common Stock for any five Trading Days within the period
of ten consecutive Trading Days ending immediately after the later of the Change in Control
or Designated Event or the public announcement thereof, in the case of an acquisition of
Capital Stock or resulting from a change in Continuing Directors, or the period of ten
consecutive Trading Days ending immediately before the Change in Control or Designated
Event, in the case of a merger, consolidation or asset sale, equals or exceeds 105% of the
Conversion Price of the Notes in effect on each of those five Trading Days; or

     (ii) at least 90% of the consideration, excluding Cash payments for fractional shares
of Common Stock and Cash payments made pursuant to dissenters’ appraisal rights, in a
transaction otherwise constituting a Change in Control or Designated Event consists of
shares of Common Stock, depositary receipts or other certificates representing common equity
interests traded on a U.S. national securities exchange or the NASDAQ Global Market or other
similar market, or will be so traded immediately following such transaction, and as a result
of such transaction the Notes become convertible solely into such consideration.

 

15

          (b) Within 30 days after the occurrence of a Designated Event or Change in Control, the
Company shall mail a written notice of such Designated Event or Change in Control, as the case may
be, by first-class mail to the Trustee and to each Holder at their addresses shown in the Security
Register (and to beneficial owners as required by applicable law). The notice shall include a form
of Purchase Notice to be completed by the Holder and shall state:

     (i) briefly, the events causing, and the effective date of, such Designated Event or
Change in Control, as the case may be;

     (ii) the date by which the Purchase Notice pursuant to this Section 4.01 must be given;

     (iii) the Purchase Price, and that the Purchase Price will be paid in Cash, in the case
of a Change in Control, or shares of Common Stock (or such other consideration into which
the shares of Common Stock have been converted or exchanged in connection with such
Designated Event) in the case of a Designated Event that is not a Change in Control;

     (iv) the Purchase Date, which date shall be the 30th Business Day after the
date of such notice;

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

     (vi) the then-current Conversion Rate and any adjustments thereto;

     (vii) that Notes with respect to which a Purchase Notice has been given by the Holder
may not be converted pursuant to Article 5 of the First Supplemental Indenture;

     (viii) briefly, the procedures a Holder must follow to exercise its rights under this
Section 4.01;

     (ix) that Notes must be surrendered to the Paying Agent to collect payment of the
Purchase Price;

     (x) that the Purchase Price for any Note as to which a Purchase Notice has been duly
given, will be paid on or prior to the first Business Day following the later of the
Purchase Date and the time of surrender of such Note;

     (xi) that, unless the Company defaults in making payment of such Purchase Price and
interest due, if any, interest on Notes surrendered for purchase will cease to accrue on and
after the Purchase Date; and

     (xii) the CUSIP number of the Notes.

          (c) A Holder may exercise its rights specified in Section 4.01(a) of the First Supplemental
Indenture by delivery of an irrevocable written notice of purchase (a “Purchase

 

16

Notice”) to the Paying Agent at any time prior to the Close of Business on the Purchase Date,
stating:

     (i) the certificate number of the Note which the Holder will deliver to be purchased,
if Certificated Notes have been issued, or notice compliant with the relevant Depositary
procedures if the Notes are not certificated;

     (ii) the portion of the principal amount of the Note which the Holder will deliver to
be purchased, which portion must be $1,000 or an integral multiple thereof; and

     (iii) that such Note shall be purchased pursuant to the terms and conditions specified
in Article 4 of the First Supplemental Indenture.

The delivery of such Note to the Paying Agent prior to, on or after the Purchase Date (together
with all necessary endorsements) at the offices of the Paying Agent shall be a condition to the
receipt by the Holder of the Purchase Price therefor; provided, however, that such Purchase Price
shall be so paid pursuant to this Section 4.01 only if the Note so delivered to the Paying Agent
shall conform in all respects to the description thereof set forth in the related Purchase Notice.

The Company shall purchase from the Holder thereof, pursuant to this Section 4.01, a portion of a
Note if the principal amount of such portion is $1,000 or an integral multiple of $1,000.
Provisions of the Indenture and the First Supplemental Indenture that apply to the purchase of all
of a Note also apply to the purchase of such portion of such Note.

Any purchase by the Company contemplated pursuant to the provisions of this Section 4.01 shall be
consummated by the delivery of the consideration to be received by the Holder on or prior to the
first Business Day following the later of the Purchase Date and the time of delivery of the Note to
the Paying Agent in accordance with this Section 4.01.

The Paying Agent shall promptly notify the Company of the receipt by it of any Purchase Notice.

     Section 4.02. Effect of Purchase Notice. Upon receipt by the Paying Agent of the
Purchase Notice specified in Section 4.01(c) of the First Supplemental Indenture, the Holder of the
Note in respect of which such Purchase Notice was given shall thereafter be entitled to receive
solely the Purchase Price, with respect to such Note. Such Purchase Price shall be paid to such
Holder, subject to receipt of funds by the Paying Agent, on or prior to the first Business Day
following the later of (x) the Purchase Date, with respect to such Note (provided the conditions in
Section 4.01(c) of the First Supplemental Indenture have been satisfied) and (y) the time of
delivery of such Note to the Paying Agent by the Holder thereof in the manner required by Section
4.01(c) of the First Supplemental Indenture. Notes in respect of which a Purchase Notice has been
given by the Holder thereof may not be converted pursuant to Article 5 of the First Supplemental
Indenture on or after the date of the delivery of such Purchase Notice unless such Purchase Notice.

     Section 4.03. Deposit of Purchase Price. (a) Prior to 11:00 a.m. (New York City time)
on or prior to the first Business Day following the Purchase Date in connection with a Change in
Control, the Company shall deposit with the Trustee or with the Paying Agent (or, if the Company or
a Subsidiary or an Affiliate of either of them is acting as the Paying Agent, shall

 

17

segregate and hold in trust as provided in Section 10.03 of the Indenture) an amount of money
(in immediately available funds if deposited on such Business Day) sufficient to pay the aggregate
Purchase Price of all the Notes or portions thereof which are to be purchased as of the Purchase
Date.

If the Trustee or the Paying Agent holds money sufficient to pay the Purchase Price of a Note on
the first Business Day following the Purchase Date in accordance with the terms hereof, then,
immediately after the Purchase Date, interest on such Note will cease to accrue, whether or not the
Note is delivered to the Trustee or the Paying Agent, and all other rights of the Holder shall
terminate, other than the right to receive the Purchase Price upon delivery of the Note.

     (b) Prior to 11:00 a.m. (New York City time) on or prior to the first Business Day following
the Purchase Date in connection with a Designated Event that is not a Change in Control, the
Company shall deposit with the Trustee or with the Paying Agent a number of shares of Common Stock
(or other consideration into which the shares of Common Stock have been converted in connection
with the Designated Event) calculated in accordance with the formula set forth below sufficient to
pay the aggregate Purchase Price of all the Notes or portions thereof which are to be purchased as
of the Purchase Date. In the event that holders of Common Stock have the opportunity to elect the
form of consideration to be received in the transaction constituting a Designated Event, the type
and amount of consideration that Holders of Notes will receive upon purchase will be deemed to be
the weighted average of the type and amount of consideration received by holders of Common Stock as
a result of such transaction.

The number of shares of Common Stock (or amount of other consideration) to be delivered upon
purchase in connection with such a Designated Event shall be determined as follows:

	 	 	 	 	 
	 

	 	Purchase Price
 

Applicable Settlement Value
	 	 

The Company will not issue fractional shares of Common Stock (or transfer any fractional
interests in any other consideration). The Company shall pay cash for all fractional shares of
Common Stock (or fractional interests in any other consideration) (calculated on an aggregate basis
for Notes delivered for purchase by any Holder) based on the Applicable Settlement Value.

All shares of Common Stock that may be issued upon purchase of Notes shall upon issuance be fully
paid and nonassessable by the Company and free from all taxes, liens and charges with respect to
the issue thereof. The Company covenants to list such Common Stock on the principal national
securities exchange on which the Common Stock is then listed in accordance with the provisions of
such exchange.

If the Trustee or the Paying Agent holds shares of Common Stock (or other consideration) sufficient
to pay the Purchase Price of a Note on the first Business Day following the Purchase Date in
accordance with the terms hereof, then, immediately after the Purchase Date, interest on such Note
will cease to accrue, whether or not the Note is delivered to the Trustee or the Paying

 

18

Agent, and all other rights of the Holder shall terminate, other than the right to receive the
Purchase Price upon delivery of the Note.

     Section 4.04. Notes Purchased In Part. Any Note which is to be purchased only in part
shall be surrendered at the office of the Paying Agent (with, if the Company or the Trustee so
requires, due endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or such Holder’s attorney duly
authorized in writing) and the Company shall execute and the Trustee shall authenticate and deliver
to the Holder of such Note, without service charge, a new Note or Notes, of any authorized
denomination as requested by such Holder in aggregate principal amount equal to, and in exchange
for, the portion of the principal amount of the Note so surrendered that is not purchased.

     Section 4.05. Covenant To Comply With Securities Laws Upon Repurchase of Notes. When
complying with the provisions of this Article Four, and subject to any exemptions available under
applicable law, the Company shall:

          (a) comply in all material respects with the applicable provisions of Rule 13e-4 and Rule
14e-1 (or any successor provision and any other issuer tender offer rules) under the Exchange Act,
as then applicable;

          (b) file the related Schedule TO (or any applicable successor schedule, form or report) if
then required, or any other then required schedule, form or report, under the Exchange Act; and

          (c) otherwise comply with all federal and state securities laws.

To the extent that the provisions of any securities laws or regulations conflict with the
provisions of Article Four of the First Supplemental Indenture, the Company’s compliance with such
laws and regulations shall not in and of itself cause a breach of its obligations under Article
Four of the First Supplemental Indenture.

     Section 4.06. Repayment to the Company. The Trustee and the Paying Agent shall return
to the Company any cash or other property that remains unclaimed for two years, subject to
applicable unclaimed property law, together with interest, if any, thereon held by them for the
payment of the Purchase Price; provided however, that to the extent that the aggregate amount of
cash or other property deposited by the Company pursuant to Section 4.03 of the First Supplemental
Indenture exceeds the aggregate Purchase Price of the Notes or portions thereof which the Company
is obligated to purchase as of the Purchase Date, then on the Business Day following the Purchase
Date, the Trustee or Paying Agent, as applicable, shall return any such excess to the Company.
Thereafter, any Holder entitled to payment must look to the Company for payment as general
creditors, unless an applicable abandoned property law designates another Person.

 

19

ARTICLE FIVE

CONVERSION OF SECURITIES

     Section 5.01. Right to Convert.

          (a) Subject to and upon compliance with the provisions of the First Supplemental Indenture, a
Holder shall have the right, at any time and from time to time, to convert any Note or any portion
of the principal amount thereof which is an integral multiple of $1,000, or of such portion
thereof, into duly authorized, fully paid and nonassessable shares of Common Stock, at the
Conversion Rate in effect at the time of conversion at any time prior to the Close of Business on
the Trading Day immediately preceding the Stated Maturity of the Notes or, if earlier, the Close of
Business on the Conversion Rights Termination Date, subject to prior redemption or repurchase of
the Notes, subject to the Company’s right to elect to satisfy any portion of its Conversion
Obligations in Cash or any other manner permitted pursuant to Section 5.04 of the First
Supplemental Indenture. In the event any Notes are called for redemption, a Holder may not convert
such Notes at any time after the Close of Business on the second Business Day immediately preceding
the Redemption Date.

          (b) Subject to Sections 5.02, 5.03 and 5.04 of the First Supplemental Indenture, each Note
shall be convertible at the office of the Conversion Agent accompanied by a duly signed and
completed Conversion Notice.

          (c) The rate at which shares of Common Stock shall be delivered upon conversion (the
“Conversion Rate”) shall be initially 108.6957 shares of Common Stock for each $1,000 principal
amount of Notes, subject to adjustment, in certain instances, as provided in Section 5.09 of the
First Supplemental Indenture, and further subject to increase in certain instances, as provided in
Section 5.08 of the First Supplemental Indenture.

          (d) A Note in respect of which a Holder has delivered a Purchase Notice or Repurchase Notice,
as the case may be, exercising the option of such Holder to require the Company to purchase such
Note shall not be converted, unless, in the case of a Repurchase Notice, such notice is withdrawn
in accordance with Section 6.02 of the First Supplemental Indenture.

          (e) Notwithstanding any other provision of the Notes or the First Supplemental Indenture, all
Holders’ rights with respect to conversion of the Notes and the Company’s obligation to deliver
shares of Common Stock at the Conversion Rate upon such conversion (the “Conversion Obligation”),
are subject, in their entirety, to the Company’ right, in its sole and absolute discretion, to
elect to satisfy such Conversion Obligation in any manner permitted pursuant to Section 5.04 of the
First Supplemental Indenture.

     Section 5.02. Right to Terminate Conversion Rights.

          (a) The Company may elect, in its sole discretion, upon at least 30 and not more than 60 days’
notice, to terminate the Holders’ rights to convert the Notes on or after December 20, 2013, if the
Closing Sale Price of Common Stock exceeds 140% of the then applicable Conversion Price for 20
Trading Days in any consecutive 30 Trading Day period

 

20

ending on the Trading Day either (a) five Trading Days prior to the mailing of the notice of
termination of conversion rights (the “Termination Notice”), provided that the Closing Sale Price
of Common Stock on such 30th Trading Day exceeded 140% of the then applicable Conversion Price, or
(b) immediately prior to the mailing of the Termination Notice, regardless of the price of Common
Stock on such 30th Trading Day (such date of termination of conversion rights is referred to herein
as the “Conversion Rights Termination Date”).

          (b) If the Company makes the election pursuant to Section 5.02(a) of the First Supplemental
Indenture, the Company shall notify the Trustee and the Holders at their addresses shown in the
Security Register and the Company shall, on a date not less than 30 days prior to the Conversion
Rights Termination Date, disseminate a press release through Dow Jones & Company, Inc. or Bloomberg
Business News or other similarly broad public medium that is customary for such press releases.

     Section 5.03. Conversion Procedures.

          (a) To convert a Note that is represented by a Certificated Note, a Holder must (1) complete
and manually sign the Notice of Conversion or a facsimile of the Notice of Conversion on the back
of the Note in substantially the form set forth in Exhibit A attached hereto (the “Conversion
Notice”) and deliver such Conversion Notice to the Conversion Agent, (2) surrender the Note to the
Conversion Agent, (3) if required by the Conversion Agent, furnish appropriate endorsement and
transfer documents, (4) if required, pay all transfer or similar taxes and (5) if required, pay
funds equal to the interest payable on the next Interest Payment Date. To convert a Note
represented by a Global Note, a Holder must convert by book-entry transfer to the Conversion Agent
through the facilities of Depositary and otherwise comply with the provisions of clauses (3), (4)
and (5) above, if applicable. The date on which the Holder satisfies all of the requirements is
the “Conversion Date.”

          (b) No payment or adjustment shall be made for dividends on, or other distributions with
respect to, any Common Stock except as provided in this Article 5. Upon conversion of a Note, a
Holder shall not receive, except as described below, any Cash payment representing accrued
interest. Upon conversion of a Note, any accrued and unpaid interest with respect to such Note
shall not be cancelled, extinguished or forfeited bur rather shall be deemed paid in full to the
Holder of such Note through the delivery of the Common Stock (together with the cash payment, if
any, in lieu of fractional shares), or cash or a combination of cash and Common Stock in lieu
thereof, in exchange for the Note being converted pursuant to the provisions hereof, and the fair
market value of the Common Stock (together with the cash payment, if any, in lieu of fractional
shares), or cash or a combination of cash and Common Stock in lieu thereof, shall be treated as
issued, to the extent thereof, first in exchange for any accrued and unpaid interest, and the
balance, if any, of such fair market value shall be treated as issued in exchange for the principal
amount of Notes being converted pursuant to the provisions hereof. Notwithstanding the preceding
sentence (but without limiting to Holder’s obligation in Section 5.03(e) of the First Supplemental
Indenture), upon conversion of a Note during the period from the Close of Business on any Regular
Record Date immediately preceding any Interest Payment Date to the Close of Business on the
Business Day immediately preceding such Interest Payment Date, the Holder on such Regular Record
Date shall receive the interest payable on such Interest Payment Date.

 

21

          (c) If a Holder converts more than one Note at the same time, the number of shares of Common
Stock issuable upon the conversion shall be based on the aggregate principal amount of Notes
converted.

          (d) Upon surrender of a Note that is converted in part, the Company shall execute, and the
Trustee shall authenticate and deliver to the Holder, a new Note equal in principal amount to the
principal amount of the unconverted portion of the Notes surrendered.

          (e) Notes or portions thereof surrendered for conversion during the period from the Close of
Business on any Regular Record Date immediately preceding any Interest Payment Date to the Close of
Business on the Business Day immediately preceding such Interest Payment Date shall be accompanied
by payment to the Company or its order, in New York Clearing House funds or other funds acceptable
to the Company, of an amount equal to the interest payable on such Interest Payment Date with
respect to the principal amount of Notes or portions thereof being surrendered for conversion;
provided that no such payment need be made with respect to conversions during such period if the
Company has given notice during the relevant interest period of (1) redemption of the Notes being
converted, (2) a Designated Event or Change of Control and the Note is being converted prior to the
applicable Purchase Date or (3) a termination of the Holders’ conversion rights pursuant to Section
5.02 of the First Supplemental Indenture.

          (f) If the last day on which a Note may be converted is not a Business Day, the Note may be
surrendered for conversion on the next succeeding day that is a Business Day.

          (g) The Company has initially appointed the Trustee as Conversion Agent. The Company may
terminate the appointment of any Conversion Agent or appoint additional or other Conversion Agents.
Notice of any termination or appointment and of any change in the office through which any
Conversion Agent will act shall be given in accordance with Section 17.03 of the Indenture.

     Section 5.04. Settlement upon Conversion.

          (a) Unless the Company has irrevocably elected net share settlement upon conversion pursuant
to Section 5.04(d) of the First Supplemental Indenture, the Company shall inform the Holders
through the Trustee of the method it will choose to satisfy its Conversion Obligations at any time
on or before the date that is two Trading Days following the Company’s receipt of a Notice of
Conversion (such period, the “Settlement Notice Period”). If the Company fails to provide notice
within the Settlement Notice Period, the Company shall satisfy its Conversion Obligations only in
shares of Common Stock (and cash in lieu of fractional shares), unless the Company has irrevocably
elected net share settlement pursuant to Section 5.04(d) of the First Supplemental Indenture. If
the Company chooses to satisfy any portion of its Conversion Obligations in cash, it will specify
the amount to be satisfied in cash as a percentage of the Conversion Obligations or a fixed dollar
amount. The Company shall treat all Holders converting on the same Trading Day in the same manner;
however, the Company shall not have any obligation to settle Conversion Obligations arising on
different Trading Days in the same manner.

 

22

          (b) If the Company elects to satisfy any portion of its Conversion Obligations in cash (other
than cash in lieu of fractional shares), a Holder may retract its Conversion Notice at any time
during the two Trading Day period beginning on the Trading Day after the Company has notified the
Trustee of its method of settlement (the “Conversion Retraction Period”), provided that no such
retraction can be made (and a Conversion Notice shall be irrevocable) if: (i) the Company has
irrevocably elected net share settlement upon conversion of the Notes prior to a Holder’s delivery
of a Conversion Notice, (ii) a Holder is converting its Notes during the period beginning on the
date the Company issued a notice of redemption and ending on the related Redemption Date or (iii) a
Holder is converting its Notes during the period beginning 25 Trading Days immediately preceding
the Stated Maturity and ending one Trading Day immediately preceding the Stated Maturity, even if
the Company has not otherwise notified the Holder prior to the Conversion Date of its settlement
method election.

The Company may, in lieu of sending individual notices of its election, send one notice to all
Holders of the method the Company chooses to satisfy its Conversion Obligation for conversions
following delivery of a notice of redemption, Termination Notice or on or following the
25th Trading Day immediately preceding the Stated Maturity.

          (c) With respect to any Conversion Notice received by the Company, the consideration to be
distributed (“Conversion Settlement Distribution”) for any Note subject to such Conversion Notice
shall consist of cash, Common Stock or a combination thereof, as selected by the Company as set
forth in this clause (c) and clause (d) below:

     (i) if the Company elects to satisfy the entire Conversion Obligation in shares of
Common Stock, the Conversion Settlement Distribution shall be a number of shares equal to
(A) the aggregate principal amount of the Notes to be converted divided by $1,000,
multiplied by (B) the then applicable Conversion Rate, plus cash for any fractional shares
pursuant to Section 5.05 of the First Supplemental Indenture;

     (ii) if the Company elects to satisfy the entire Conversion Obligation in cash, the
Conversion Settlement Distribution shall be cash in an amount equal to the product of:

     (A) a number equal to the product of (x) the aggregate principal amount of
Notes to be converted divided by $1,000 multiplied by (y) the then applicable
Conversion Rate, and

     (B) the average Closing Sale Price of the Common Stock for the 20 Trading Day
period beginning on: (1) for Notes converted during the period beginning on the
30th day immediately prior to the Stated Maturity or the Conversion
Rights Termination Date, the third Trading Day after the Stated Maturity or the
Conversion Rights Termination Date, as the case may be, and (2) in all other
instances, the third Trading Day immediately after the Conversion Date (the “Cash
Settlement Averaging Period”); and

     (iii) if the Company elects to satisfy a percentage or fixed amount (other than 100%)
of the Conversion Obligation per $1,000 principal amount of Notes in cash, the

 

23

Conversion Settlement Distribution shall consist of the amount of cash so elected
(“Cash Amount”) and a number of shares of Common Stock per $1,000 principal amount of Notes
equal to the sum, for each Trading Day of the Cash Settlement Averaging Period, of the
greater of:

     (A) zero, and

     (B) a number of shares determined by the following formula:

(Closing Sale Price of Common Stock on such Trading Day x applicable Conversion Rate) – Cash Amount

Closing Sale Price of Common Stock on such Trading Day x 20

          (d) Notwithstanding anything to the contrary in the First Supplemental Indenture, at any
time on prior to the 26th Trading Day immediately preceding the Stated Maturity, the
Company may irrevocably elect, in its sole discretion without the consent of the Holders of the
Notes, by written notice to the Trustee and the Holders of the Notes to satisfy its Conversion
Obligation for all Notes to be converted after the date of such election with a combination of cash
in an amount equal to the lower of (a) the Conversion Value and (b) the aggregate principal amount
of the Notes to be converted, and shares of Common Stock representing the excess, if any, of such
Conversion Value over such aggregate principal amount. The number of shares of Common Stock so to
be delivered per $1,000 principal amount of Notes for such excess, if any, will be equal to the
sum, for each Trading Day in the Cash Settlement Averaging Period, of the greater of:

     (A) zero, and

     (B) a number of shares determined by the following formula:

(Closing Sale Price of Common Stock on such Trading Day x applicable Conversion Rate) – $1,000

Closing Sale Price of Common Stock on such Trading Day x 20

          (e) The Company shall settle its Conversion Obligations (i) on the third Trading Day
following the final Trading Day of the Cash Settlement Averaging Period if it elects to satisfy its
Conversion Obligations partially or entirely in cash and (ii) as soon as practicable after the
Company elects to satisfy its Conversion Obligations entirely in shares of Common Stock or the
Company is required to, or fails to, notify Holders of its election not to satisfy its Conversion
Obligations partially or entirely in cash as provided in Section 5.04(a) of the First Supplemental
Indenture.

     Section 5.05. Fractional Shares. The Company shall not issue a fractional share of
Common Stock upon conversion of a Note. However, if the Company elects to satisfy the entire
Conversion Obligation with shares of Common Stock, the Company shall pay cash for all fractional
shares of Common Stock (calculated on an aggregate basis for the Notes surrendered by a Holder for
conversion) based on the Closing Sale Price of the Common Stock on the Trading Day immediately
preceding the Conversion Date. Similarly, if the Company elects to satisfy a percentage or fixed
amount of the Conversion Obligation in Cash, the Company shall pay cash for fractional shares of
Common Stock (calculated on an aggregate basis for the Notes

 

24

surrendered by a Holder for conversion) based on the Closing Sale Price of the Common Stock on
the last Trading Day of the Cash Settlement Averaging Period.

     Section 5.06. Taxes on Conversion. If a Holder converts a Note, the Company shall pay
any taxes or duties relating to the issue or delivery of Common Stock upon conversion of the Note.
However, the Holder shall pay any such tax which is due because the Holder requests the shares to
be issued in a name other than the Holder’s name. The Conversion Agent may refuse to deliver the
certificates representing the Common Stock being issued in a name other than the Holder’s name
until the Conversion Agent receives a sum sufficient to pay any tax which will be due because the
Common Stock is to be delivered in a name other than the Holder’s name. Nothing herein shall
preclude any tax withholding required by law or regulations.

     Section 5.07. Reservation of Shares, Shares to be Fully Paid; Listing of Common Stock.

          (a) The Company shall provide, free from preemptive rights, out of its authorized but unissued
shares or shares held in treasury, sufficient shares of Common Stock to provide for the conversion
of the Notes from time to time as such Notes are presented for conversion.

          (b) All shares of Common Stock that may be issued upon conversion of Notes shall upon issuance
be fully paid and nonassessable by the Company and free from all taxes, liens and charges with
respect to the issue thereof.

          (c) The Company shall, if at any time the Common Stock shall be listed on the New York Stock
Exchange or any other national securities exchange or automated quotation system, if permitted by
the rules of such exchange or automated quotation system, list and keep listed, so long as the
Common Stock shall be so listed on such exchange or automated quotation system, all Common Stock
issuable upon conversion of the Note; provided, however, that, if the rules of such exchange or
automated quotation system permit the Company to defer the listing of such Common Stock until the
first conversion of the Notes into Common Stock in accordance with the provisions of the First
Supplemental Indenture, the Company covenants to list such Common Stock issuable upon conversion of
the Notes in accordance with the requirements of such exchange or automated quotation system at
such time.

     Section 5.08. Adjustment to the Conversion Rate upon a Designated Event.

          (a) Subject to the terms and conditions of this Section 5.08, if a Designated Event occurs on
or prior to December 20, 2016, and a Holder elects to convert its Notes in connection with such
Designated Event, the Company shall increase the Conversion Rate for the Notes surrendered for
conversion by a number of additional shares of Common Stock (the “Make-Whole Shares”), as described
in this Section 5.08. A conversion of Notes shall be deemed for the purposes of this Section 5.08
to be “in connection with” a Designated Event if such Notes are surrendered for conversion during
the period commencing on the effective date of such transaction (the “Effective Date”) and ending
on the Purchase Date in connection with such transaction, if applicable or, if there is no Purchase
Date, ending on the 30th day following the Effective Date of such transaction.

 

25

Notwithstanding the foregoing, no increase in the Conversion Rate shall be made in the case of
any Designated Event if at least 90% of the consideration, excluding cash payments for fractional
shares of Common Stock and cash payments made pursuant to dissenters’ appraisal rights, in a
transaction otherwise constituting a Designated Event consists of shares of common stock,
depositary receipts or other certificates representing common equity interests traded on a U.S.
national securities exchange or the NASDAQ Global Market or other similar market, or will be so
traded immediately following such transaction, and as a result of such transaction the Notes become
convertible solely into such consideration.

          (b) The Company shall mail a notice to Holders and issue a press release through Dow Jones &
Company, Inc. or Bloomberg Business News or other similarly broad public medium that is customary
for such press releases no later than 20 days prior to the anticipated Effective Date for such
Designated Event. The failure to deliver such notice or issue such press release shall not affect
the validity of such transaction.

          (c) The number of Make-Whole Shares shall be determined by reference to the table below in
(d)(ii) of this Section and shall be based on the Effective Date and the Applicable Price in
connection with such Designated Event.

          (d) (i) The stock prices set forth in the first row of the table below (i.e., the column
headers), shall be adjusted as of any date on which the Conversion Rate of the Notes is adjusted.
The adjusted stock prices will equal the Applicable Prices in effect immediately prior to such
adjustment multiplied by a fraction, the numerator of which is the Conversion Rate in effect
immediately prior to the adjustment giving rise to the Applicable Price adjustment and the
denominator of which is the Conversion Rate as so adjusted. The number of Make-Whole Shares will
be subject to adjustment in the same manner as the Conversion Rate as set forth under Section 5.09
of the First Supplemental Indenture.

 

26

               (ii) The following table sets forth the number of Make-Whole Shares to be added to the
Conversion Rate per $1,000 principal amount of Notes:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Applicable Price	 
	Effective Date
	 	$	7.36	 	 	$	8.00	 	 	$	9.00	 	 	$	10.00	 	 	$	11.00	 	 	$	12.00	 	 	$	13.00	 	 	$	14.00	 	 	$	20.00	 	 	$	25.00	 	 	$	30.00	 	 	$	50.00	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	December 15, 2006
	 	 	27.1739	 	 	 	25.9493	 	 	 	21.4781	 	 	 	18.1035	 	 	 	15.4836	 	 	 	13.4012	 	 	 	11.7128	 	 	 	10.3206	 	 	 	5.3971	 	 	 	3.4001	 	 	 	2.2009	 	 	 	0.0000	 
	December 15, 2007
	 	 	27.1739	 	 	 	25.6222	 	 	 	21.0635	 	 	 	17.6504	 	 	 	15.0212	 	 	 	12.9465	 	 	 	11.2757	 	 	 	9.9065	 	 	 	5.1333	 	 	 	3.2269	 	 	 	2.0876	 	 	 	0.0000	 
	December 15, 2008
	 	 	27.1739	 	 	 	25.2362	 	 	 	20.5592	 	 	 	17.0907	 	 	 	14.4438	 	 	 	12.3741	 	 	 	10.7217	 	 	 	9.3784	 	 	 	4.7863	 	 	 	2.9953	 	 	 	1.9343	 	 	 	0.0000	 
	December 15, 2009
	 	 	27.1739	 	 	 	24.9915	 	 	 	20.1410	 	 	 	16.5763	 	 	 	13.8813	 	 	 	11.7941	 	 	 	10.1435	 	 	 	8.8141	 	 	 	4.3819	 	 	 	2.7131	 	 	 	1.7410	 	 	 	0.0000	 
	December 15, 2010
	 	 	27.1739	 	 	 	24.1951	 	 	 	19.1318	 	 	 	15.4615	 	 	 	12.7291	 	 	 	10.6472	 	 	 	9.0284	 	 	 	7.7468	 	 	 	3.6726	 	 	 	2.2392	 	 	 	1.4276	 	 	 	0.0000	 
	December 15, 2011
	 	 	27.1739	 	 	 	23.1488	 	 	 	17.7625	 	 	 	13.9197	 	 	 	11.1160	 	 	 	9.0392	 	 	 	7.4597	 	 	 	6.2446	 	 	 	2.7029	 	 	 	1.6140	 	 	 	1.0274	 	 	 	0.0000	 
	December 15, 2012
	 	 	27.1739	 	 	 	21.9141	 	 	 	15.9745	 	 	 	11.7968	 	 	 	8.8114	 	 	 	6.6783	 	 	 	5.1437	 	 	 	4.0346	 	 	 	1.4097	 	 	 	0.8381	 	 	 	0.5479	 	 	 	0.0000	 
	December 15, 2013
	 	 	27.1739	 	 	 	21.1933	 	 	 	14.4133	 	 	 	9.3503	 	 	 	5.4445	 	 	 	2.5278	 	 	 	0.6971	 	 	 	0.1041	 	 	 	0.0072	 	 	 	0.0017	 	 	 	0.0000	 	 	 	0.0000	 
	December 15, 2014
	 	 	27.1739	 	 	 	20.9295	 	 	 	13.8798	 	 	 	8.8214	 	 	 	5.0553	 	 	 	2.2484	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 
	December 15, 2015
	 	 	27.1739	 	 	 	19.3770	 	 	 	11.9211	 	 	 	7.1020	 	 	 	3.8867	 	 	 	1.6924	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 
	December 20, 2016
	 	 	27.1739	 	 	 	16.3043	 	 	 	2.4155	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 

          (e) If the exact Applicable Price and Effective Date are not set forth in the table
above, then:

     (i) if the actual Applicable Price is between two Applicable Prices in the
table or the Effective Date is between two Effective Dates in the table, the
Make-Whole Shares issued upon conversion of the Notes shall be determined by a
straight-line interpolation between the number Make-Whole Shares set forth for the
higher and lower Applicable Prices and/or the earlier and later Effective Dates in
the table, based on a 365-day year, as applicable;

     (ii) if the actual Applicable Price is equal to or in excess of $50.00 per
share, subject to adjustment as set forth in Section 5.08(d)(i) of the First
Supplemental Indenture, no Make-Whole Shares shall be issued upon conversion of the
Notes; and

     (iii) if the Applicable Price is equal to or less than $7.36 per share, subject
to adjustment as set forth in Section 5.08(d)(i) of the First Supplemental
Indenture, no Make-Whole Shares shall be issued upon conversion of the Notes.

 

 

27

          (f) Notwithstanding the foregoing, in no event shall the Company increase the Conversion Rate
if the increase shall cause the Conversion Rate to exceed 135.8696 shares per $1,000 principal
amount of Notes, subject to adjustment in the same manner as the Conversion Rate as set forth in
Section 5.09(a)(1) through (a)(4) of the First Supplemental Indenture.

     Section 5.09. Conversion Rate Adjustments.

          (a) The Conversion Rate shall be adjusted for the following events:

(1) The issuance of Common Stock as a dividend or distribution to all holders of Common
Stock, or a subdivision or combination of Common Stock, in which event the Conversion Rate
will be adjusted based on the following formula:

	 	 	 	 	 	 	 
	 

	 	where,	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	CR0
	 	=
	 	the Conversion Rate in effect at the Close of Business on the Record Date
	 

	 	CR1
	 	=
	 	the Conversion Rate in effect immediately after the Record Date
	 

	 	OS0
	 	=
	 	the number of shares of Common Stock outstanding at the Close of Business
on the Record Date
	 

	 	OS1
	 	=
	 	the number of shares of Common Stock that would be outstanding immediately
after, and solely as a result of, such event

          Such adjustment shall become effective immediately after the Record Date. If any
dividend or distribution or subdivision or combination of the type described in Section
5.09(a)(1) of the First Supplemental Indenture 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
if such dividend or distribution or subdivision or combination had not been declared.

 

 

28

     (2) The issuance to all holders of Common Stock of rights or warrants entitling them
for a period expiring 60 days or less from the date of issuance of such rights or warrants
to purchase shares of Common Stock (or securities convertible into Common Stock) at less
than (or having a conversion price per share less than) the Current Market Price of Common
Stock, in which event the Conversion Rate will be adjusted based on the following formula:

	 	 	 	 	 	 	 
	 

	 	where,	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	CR0
	 	=
	 	the Conversion Rate in effect at the Close of Business on the Record Date
	 

	 	CR1
	 	=
	 	the Conversion Rate in effect immediately after the Record Date
	 

	 	OS0
	 	=
	 	the number of shares of Common Stock outstanding at the Close of Business
on the Record Date
	 

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

	 	Y
	 	=
	 	the aggregate price payable to exercise such rights or warrants divided by
the average of the Closing Sale Prices of Common Stock for the ten consecutive Trading
Days prior to the Business Day immediately preceding the first date on which the shares
of Common Stock trade on the applicable exchange or in the applicable market, regular
way, without the right to receive such rights or warrants

Such adjustment shall become effective immediately after the Record Date for such
distribution. In the event that such rights or warrants are not so distributed, the
Conversion Rate shall again be adjusted to be the Conversion Rate that would then be in
effect if the Record Date for such distribution had not occurred. To the extent that such
rights or warrants are not exercised prior to their expiration or shares of Common Stock are
otherwise 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 the delivery of only the number of shares
of Common Stock actually delivered. In determining the aggregate price payable for such shares of Common Stock, there shall be taken into account any consideration received for
such rights or warrants and the value of such consideration if other than Cash, to be
determined in good faith by the Board of Directors.

 

 

29

     (3) The dividend or other distribution to all holders of Common Stock of shares of the
Company’s Capital Stock (other than Common Stock) or evidences of the Company’s
indebtedness, rights or warrants to purchase the Company’s securities, or the Company’s
assets (excluding (A) any dividend, distribution or issuance covered by clauses (1) or (2)
above or (4) or (5) below), in which event the Conversion Rate will be adjusted based on the
following formula:

	 	 	 	 	 	 	 
	 

	 	where,	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	CR0
	 	=
	 	the Conversion Rate in effect at the Close of Business on the Record Date
	 

	 	CR1
	 	=
	 	the Conversion Rate in effect immediately after the Record Date
	 

	 	SP0
	 	=
	 	the Current Market Price
	 

	 	FMV
	 	=
	 	the fair market value (as determined in good faith by the Board of Directors), on the
Record Date, of the shares of Capital Stock, evidences of indebtedness or assets so
distributed, expressed as an amount per share of Common Stock

If the transaction that gives rise to an adjustment pursuant to this clause (3) is,
however, one pursuant to which the payment of a dividend or other distribution on Common
Stock consists of shares of capital stock of, or similar equity interests in, a subsidiary
of the Company or other business unit of the Company (i.e., a spin-off) that are, or, when
issued, will be, traded or quoted on The New York Stock Exchange or any other national or
regional securities exchange or market, then the Conversion Rate will instead be adjusted
based on the following formula:

	 	 	 	 	 	 	 
	 

	 	where,	 	 	 	 
	 

	 	CR0
	 	=
	 	the Conversion Rate in effect at the Close of Business on the Record Date
	 

	 	CR1
	 	=
	 	the Conversion Rate in effect immediately after the Record Date
	 

	 	FMV0
	 	=
	 	the average of the Closing Sale Prices of the Capital Stock or similar equity
interests distributed to holders of Common Stock applicable to one share of
Common Stock over the 10 consecutive Trading Days commencing on and
including the third Trading Day after the date on which Ex-distribution trading
commences with respect to such dividend or distribution on The
New York Stock Exchange or such other national or regional securities exchange or
market on which the Common Stock is then listed or quoted
	 

	 	MP0
	 	=
	 	the average of the Closing Sale Prices of Common Stock over the 10
consecutive Trading Days commencing on and including the third Trading Day
after the date on which Ex-distribution trading commences with respect to such dividend
or distribution on The New York Stock Exchange or such other national or
regional securities exchange Ex-distribution trading or market on which Common Stock is
then listed or quoted

Such increase shall become effective immediately after the Record Date for such
dividend or distribution. In the event that such dividend or distribution is not so made,
the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in
effect if such distribution had not been declared.

 

 

30

     (4) Dividends or other distributions consisting exclusively of cash to all holders of
Common Stock, in which event the Conversion Rate will be adjusted based on the following
formula:

	 	 	 	 	 	 	 
	 

	 	where,	 	 	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	CR0
	 	=
	 	the Conversion Rate in effect at the Close of Business on the Record Date
	 

	 	CR1
	 	=
	 	the Conversion Rate in effect immediately after the Record Date
	 

	 	SP0
	 	=
	 	the Current Market Price
	 

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

Such adjustment shall become effective immediately after the Record Date for such
dividend or distribution. In the event that such distribution is not so made, the Conversion
Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such
dividend or distribution had not been declared.

     (5) The Company or one or more subsidiaries of the Company make purchases of Common
Stock pursuant to a tender offer or exchange offer (other than offers not subject to Rule
13e-4 under the Exchange Act) by the Company or a subsidiary of the Company for the Common
Stock to the extent that the cash and value of any other consideration included in the
payment per share of Common Stock validly tendered or exchanged exceeds the Closing Sale
Price per share of Common Stock on the Trading Day next succeeding the last date on which
tenders or exchanges may be made pursuant to such tender or exchange offer (the “expiration
date”), in which event the Conversion Rate will be adjusted based on the following formula:

	 	 	 	 	 	 	 
	 

	 	where,	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	CR0
	 	=
	 	the Conversion Rate in effect at the Close of Business on the expiration date
	 

	 	CR1
	 	=
	 	the Conversion Rate in effect immediately after the expiration date
	 

	 	FMV
	 	=
	 	the fair market value (as determined by the Board of Directors), on the
expiration date, of the aggregate value of all Cash and any other consideration
paid or payable for shares validly tendered or exchanged and not withdrawn as
of the expiration date (the “purchased shares”)
	 

	 	OS1
	 	=
	 	the number of shares of Common Stock outstanding as of the last time
tenders or exchanges may be made pursuant to such tender or exchange offer
(the “expiration time”) less any purchased shares
	 

	 	OS0
	 	=
	 	the number of shares of Common Stock outstanding at the expiration time,
including any purchased shares
	 

	 	SP1
	 	=
	 	the average of the Closing Sale Prices of Common Stock for the 10
consecutive Trading Days commencing on the Trading Day immediately after
the expiration date

     An adjustment, if any, to the Conversion Rate pursuant to this Section 5.09(a)(5) shall
become effective immediately prior to the opening of business on the Trading Day immediately
following the “expiration date.” In the event that the Company or a subsidiary of the Company

 

 

31

is obligated to purchase shares of Common Stock pursuant to any such tender offer or exchange
offer, but the Company or such subsidiary is permanently prevented by applicable law from effecting
any such purchases, or all such purchases are rescinded, then the Conversion Rate shall again be
adjusted to be the Conversion Rate which would then be in effect if such tender offer or exchange
offer had not been made. Except as set forth in the preceding sentence, if the application of this
Section 5.09(a)(5) to any tender offer or exchange offer would result in a decrease in the
Conversion Rate, no adjustment shall be made for such tender offer or exchange offer under this
Section 5.09(a)(5).

          (b) In no event will the Company adjust the Conversion Rate to the extent that the adjustment
would reduce the Conversion Price below the par value per share of Common Stock.

          (c) Whenever any provision of the First Supplemental Indenture shall require the calculation
of an average of Closing Sale Prices over a span of multiple days, the Company shall in good faith
make appropriate adjustments to account for any adjustment to the Conversion Rate that becomes
effective, or any event requiring an adjustment to the Conversion Rate where the Ex Date of the
event occurs, at any time during the period from which the average is to be calculated.

          (d) 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 Section 5.09 of the
First Supplemental Indenture (and no adjustment to the Conversion Rate under Section 5.09 of the
First Supplemental Indenture will be required) until the occurrence of the earliest Trigger Event,
whereupon such rights and warrants shall be deemed to have been distributed and an appropriate
adjustment (if any is required) to the Conversion Rate shall be made under Section 5.09 of the
First Supplemental Indenture, except as set forth in Section 5.09(e) of the First Supplemental
Indenture. If any such right or warrant are subject to events, upon the occurrence of which such
rights or warrants become exercisable to purchase different securities, evidences of indebtedness
or other assets, then the date of the occurrence of any and each such event shall be deemed to be
the date of distribution and Record Date with respect to new rights or warrants with such rights,
except as set forth in Section 5.09(e) of the First Supplemental Indenture. In addition, except as
set forth in Section 5.09(e) of the First Supplemental Indenture, in the event of any distribution
(or deemed distribution) of rights or warrants, or any Trigger Event or other event (of the type
described in the preceding sentence) with respect thereto that was counted for purposes of
calculating a distribution amount for which an adjustment to the Conversion Rate under Section 5.09
of the First Supplemental Indenture was made (including any adjustment contemplated in Section
5.09(e) of the First Supplemental Indenture), (1) in the case of any such rights or warrants that
shall all have been redeemed or repurchased without exercise by the holders thereof, the Conversion
Rate shall be readjusted upon such final redemption or repurchase to give effect to such
distribution or Trigger Event, as the case may be, as though it were a Cash distribution, equal to
the per share redemption or repurchase price received by a holder or holders of Common Stock with
respect to such rights or

 

 

32

warrants (assuming such holder had retained such rights or warrants), made to all holders of
Common Stock as of the date of such redemption or repurchase, and (2) in the case of such rights or
warrants that shall have expired or been terminated without exercise by the holders thereof, the
Conversion Rate shall be readjusted as if such rights and warrants had not been issued.

          (e) If a shareholders rights plan under which any rights are issued provides that each
share of Common Stock issued upon conversion of Notes at any time prior to the distribution of
separate certificates representing such rights shall be entitled to receive such rights, there
shall not be any adjustments to the conversion privilege or Conversion Rate. If prior to any
conversion of a Note, the rights have separated from the Common Stock, the Conversion Rate shall be
adjusted at the time of separation as if the Company distributed to all holders of Common Stock,
the Company’s assets, debt securities or rights as described in clause (a)(3) above, subject to
readjustment in the event of the expiration, termination or redemption of such rights.

          (f) No adjustment shall be made in the Conversion Rate for any of the transactions described
in this Section 5.09 if the Company makes provisions for Holders to participate in any such
transaction without conversion on a basis and with notice that the Board of Directors determines to
be fair and appropriate.

          (g) Except in accordance with this Section 5.09, the Conversion Rate will not be adjusted for
the issuance of Common Stock or any securities convertible into or exchangeable for Common Stock or
carrying the right to purchase any of the foregoing. No adjustment to the Conversion Rate shall be
made for a change in the par value or no par value of the Common Stock or any rights to purchase
Common Stock pursuant to a Company plan for reinvestment of dividends.

          (h) Notwithstanding anything in this Section 5.09 to the contrary, the conversion rate as
adjusted in accordance with this Section 5.09 shall not exceed 135.8696 shares per $1,000 principal
amount of Notes, other than on account of proportional adjustments to the Conversion Rate in the
manner set forth in clauses (a)(1) through (a)(4) of Section 5.09 of the First Supplemental
Indenture.

          (i) For purposes of Section 5.09(a)(1), (2) and (3) of the First Supplemental Indenture, any
dividend or distribution to which Section 5.09(a)(3) of the First Supplemental Indenture is
applicable that also includes shares of Common Stock, or rights or warrants to subscribe for or
purchase shares of Common Stock (or both), shall be deemed instead to be (1) a dividend or
distribution of the indebtedness, assets or shares of Capital Stock other than such shares of
Common Stock or rights or warrants (and any Conversion Rate adjustment required by Section
5.09(a)(3) of the First Supplemental Indenture with respect to such dividend or distribution shall
then be made) immediately followed by (2) a dividend or distribution of such shares of Common Stock
or such rights or warrants (and any further Conversion Rate adjustment required by Section 5.09 of
the First Supplemental Indenture with respect to such dividend or distribution shall then be made),
except 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.”

 

 

33

          (j) No adjustment shall be made to the Conversion Rate unless the adjustment would result in a
change of at least 1% of the Conversion Rate; provided that any adjustments that are less than 1%
of the Conversion Rate shall be carried forward and such carried forward adjustments, regardless of
whether the aggregate adjustment is less than 1%, shall be made (a) annually, on the anniversary of
the first date of issue of the Notes and otherwise (b) (i) five Business Days prior to the Stated
Maturity of the Notes or (ii) five Business Days prior to the Conversion Rights Termination Date,
Redemption Date, Repurchase Date or Purchase Date, unless such adjustment has already been made.

          (k) The Company may from time to time, to the extent permitted by law and subject to
applicable rules of The New York Stock Exchange, increase the Conversion Rate of the Notes by any
amount for any period of at least 20 days. Whenever the Conversion Rate is increased pursuant to
the preceding sentence, the Company shall mail to Holders at least 15 days prior to the date the
increased Conversion Rate takes effect, and such notice shall state the increased Conversion Rate
and the period during which it will be in effect.

          (l) The Company may make such increases in the Conversion Rate, in addition to those set forth
above, as the Company’s Board of Directors deems advisable, including to avoid or diminish any
income tax to holders of the Common Stock resulting from any dividend or distribution of stock (or
rights to acquire stock) or from any event treated as such for income tax purposes.

          (m) For purposes of this Section 5.09, the number of shares of Common Stock at any time
outstanding shall not include shares held, directly or indirectly, by the Company, but shall
include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of
Common Stock.

          (n) In any case in which this Section 5.09 provides that an adjustment shall become effective
immediately after (1) a Record Date for an event or (2) the “expiration date” for any tender or
exchange offer pursuant to Section 5.09(a)(5) of the First Supplemental Indenture (each a
“Determination Date”), the Company may elect to defer, until the later of the date the adjustment
to the Conversion Rate can be definitively determined and the occurrence of the applicable
Adjustment Event (as hereinafter defined), (x) issuing to the Holder of any Note converted after
such Determination Date and before the occurrence of such Adjustment Event, the additional shares
of Common Stock or other securities or assets issuable upon such conversion, or cash in lieu
thereof, by reason of the adjustment required by such Adjustment Event over and above the Common
Stock issuable upon such conversion, or cash in lieu thereof, before giving effect to such
adjustment and (y) paying to such Holder any amount in cash in lieu of any fraction pursuant to
Section 5.05 of the First Supplemental Indenture. For purposes of this Section 5.09(n), the term
“Adjustment Event” shall mean:

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

          (ii) in any case referred to in clause (2) hereof, the date a sale or exchange of Common Stock
pursuant to such tender or exchange offer is consummated and becomes irrevocable.

 

 

34

     Section 5.10 Effect of Recapitalization, Reclassification and Changes to the Common Stock. 

          If any of the following events occur:

          (i) any recapitalization,

          (ii) any reclassification or change of the outstanding share of Common Stock (other than
changes resulting from a subdivision or combination to which Section 5.09(a)(1) of the First
Supplemental Indenture applies),

          (iii) any consolidation, merger or combination involving the Company,

          (iv) any sale or conveyance to a third party of substantially all of the Company’s assets, or

          (v) any statutory share exchange,

in each case as a result of which the Common Stock would be converted into, or exchanged for,
stock, other securities, other property or assets (including cash or any combination thereof),
then, at the effective time of the transaction, the Company or the successor or purchasing Person,
as the case may be, shall execute with the Trustee a supplemental indenture (which shall comply
with the Trust Indenture Act as in force at the date of execution of such supplemental indenture)
providing that the right to convert a Note shall be changed, subject to the Company’s (or the
Company’s successor’s) right to deliver, in lieu of shares of Common Stock, cash or a combination
of cash and Common Stock, as described under Section 5.04 of the First Supplemental Indenture, into
a right to convert such Note into the kind and amount of shares of stock, other securities or other
property or assets (including cash or any combination thereof) that a holder of a share of Common
Stock would have owned or been entitled to receive (the “reference property”) upon such
transaction. In the event holders of Common Stock have the opportunity to elect the form of
consideration to be received in such transaction, the type and amount of consideration that Holders
of Notes would have been entitled to receive shall be deemed to be the weighted average of the
types and amounts of consideration received by the holders of Common Stock, subject to the
Company’s (or the successor’s) right to deliver, in lieu of the reference property, cash or a
combination of cash and reference property, as described under Section 5.04 of the First
Supplemental Indenture. The Company hereby agrees not to become a party to any such transaction
unless its terms are consistent with the foregoing. 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 5.

     The above provisions of this Section 5.10 shall similarly apply to successive
reclassifications, changes, consolidations, mergers, binding share exchanges, combinations, sales
and transfers.

     If this Section 5.10 applies to any event or occurrence, Section 5.09 of the First
Supplemental Indenture shall not apply.

 

 

35

     Section 5.11. Notice of Adjustment. Whenever the Conversion Rate is adjusted, the
Company shall promptly mail to Holders a notice of the adjustment. The Company shall file with the
Trustee and the Conversion Agent such notice and an Officer’s Certificate briefly stating the facts
requiring the adjustment and the manner of computing it. The certificate shall be conclusive
evidence that the adjustment is correct. Neither the Trustee nor any Conversion Agent shall be
under any duty or responsibility with respect to any such certificate except to exhibit the same to
any Holder desiring inspection thereof.

     Section 5.12. Company Determination Final. The Company shall be responsible for making
all calculations called for hereunder and under the Notes. These calculations include, but are not
limited to, the Conversion Value, the Conversion Date, the Current Market Value, the Conversion
Price, the applicable Conversion Rate, the number of shares of Common Stock, if any, to be issued
upon conversion of the Notes, the Cash Settlement Averaging Period and the amount of the Conversion
Settlement Distribution. The Company shall make all these calculations in good faith and, absent
manifest error, the Company’s calculations will be final and binding on Holders. The Company shall
provide a schedule of the Company’s calculations to the Trustee, and the Trustee is entitled to
rely upon the accuracy of the Company’s calculations without independent verification.

     Section 5.13. Trustee’s Adjustment Disclaimer. The Trustee has no duty to determine
when an adjustment under this Article 5 should be made, how it should be made or what it should be
nor shall the Trustee have any duty or responsibility to confirm or verify any calculation called
for hereunder or under the Notes. The Trustee has no duty to determine whether a supplemental
indenture under Section 5.10 of the First Supplemental Indenture need be entered into or whether
any provisions of any supplemental indenture are correct. The Trustee shall not be accountable for
and makes no representation as to the validity or value of any securities or assets issued upon
conversion of Notes. The Trustee shall not be responsible for the Company’s failure to comply with
this Article 5. Each Conversion Agent shall have the same protection under this Section 5.13 as the
Trustee.

     Section 5.14. Withholding Taxes for Adjustments in Conversion Rate. The Company may,
at its option, set-off withholding taxes due with respect to Notes against payments of Cash and
Common Stock on the Notes to the extent required by law. In the case of any such set-off against
Common Stock delivered upon conversion of the Notes, such Common Stock shall be valued at the
Closing Sale Price of the Common Stock on the date of setoff.

ARTICLE SIX

REPURCHASE AT OPTION OF HOLDERS

     Section 6.01. Right to Require Repurchase.

          (a) Each Holder has the right to require the Company to purchase for Cash all or a portion of
the Notes held by such Holder on December 20, 2016 and December 15, 2026, or if any such day is not
a Business Day, on the immediately succeeding Business Day (each, a “Repurchase Date”), at a
purchase price equal to 100% of the principal amount of the Notes to be purchased, plus accrued and
unpaid interest to, but not including, the Repurchase Date (the “Repurchase Price”), subject to
satisfaction by or on behalf of the Holder of the requirements

 

 

36

set forth in Section 6.01(c) of the First Supplemental Indenture; provided that if the
Repurchase Date is after a Regular Record Date and on or prior to the Interest Payment Date to
which it relates, interest accrued to the Interest Payment Date will be paid to Holders of the
Notes as of the preceding Regular Record Date.

          (b) On or before the 20th Business Day prior to each Repurchase Date, the Company shall mail a
written notice by first-class mail to the Trustee and to each Holder at their addresses shown in
the Security Register (and to beneficial owners as required by applicable law) of the procedures
the Holders must follow to require the Company to repurchase their Notes, and the Company shall
disseminate a press release providing the information stated in the notice, through Dow Jones &
Company, Inc. or Bloomberg Business News or other similarly broad public medium that is customary
for such press releases. The notice shall include a form of Repurchase Notice to be completed by
the Holder and shall state:

     (i) the Repurchase Price;

     (ii) the date by which the Repurchase Notice pursuant to this Section 6.01 must be
given;

     (iii) the Repurchase Date;

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

     (v) the then-current Conversion Rate and any adjustments thereto;

     (vi) that Notes with respect to which a Repurchase Notice has been given by the Holder
may be converted pursuant to Article 5 of the First Supplemental Indenture only if the
Repurchase Notice has been withdrawn in accordance with the terms of the Indenture and the
First Supplemental Indenture;

     (vii) briefly, the procedures a Holder must follow to exercise its rights under this
Section 6.01;

     (viii) that Notes must be surrendered to the Paying Agent to collect payment of the
Repurchase Price;

     (ix) that the Repurchase Price for any Note as to which a Repurchase Notice has been
duly given and not withdrawn, will be paid in Cash on the later of the Repurchase Date and
the time of surrender of such Note;

     (x) the procedures for withdrawing a Repurchase Notice;

     (xi) that, unless the Company defaults in making payment of such Repurchase Price,
interest on Notes surrendered for repurchase will cease to accrue on and after the
Repurchase Date; and

     (xii) the CUSIP number of the Notes.

 

 

37

          (c) A Holder may exercise its rights specified in Section 6.01(a) of the First Supplemental
Indenture by delivery of a written notice of repurchase (a “Repurchase Notice”) to the Paying Agent
at any time from the date that is 30 Business Days prior to the Repurchase Date until the Close of
Business on the fifth Business Day prior to the Repurchase Date, stating:

     (i) the certificate number of Notes which the Holder will deliver to be repurchased, if
Certificated Notes have been issued, or notice compliant with the relevant Depositary
procedures if the Notes are not certificated;

     (ii) the aggregate principal amount of Notes which the Holder will deliver to be
repurchased, which amount must be $1,000 or an integral multiple thereof; and

     (iii) that any such Notes shall be repurchased pursuant to the terms and conditions
specified in Article 6 of the First Supplemental Indenture.

The delivery of such Note to the Paying Agent prior to, on or after the Repurchase Date (together
with all necessary endorsements) at the offices of the Paying Agent shall be a condition to the
receipt by the Holder of the Repurchase Price therefor; provided, however, that such Repurchase
Price shall be so paid pursuant to this Section 6.01 only if the Note so delivered to the Paying
Agent shall conform in all respects to the description thereof set forth in the related Repurchase
Notice.

The Company shall repurchase from the Holder thereof, pursuant to this Section 6.01, a portion of a
Note if the principal amount of such portion is $1,000 or an integral multiple of $1,000, if so
requested in writing by such Holder. Provisions of the Indenture and the First Supplemental
Indenture that apply to the repurchase of all of a Note also apply to the repurchase of such
portion of such Note.

Any repurchase by the Company contemplated pursuant to the provisions of this Section 6.01 shall be
consummated by the delivery of the consideration to be received by the Holder on the later of the
Repurchase Date and the time of delivery of the Note to the Paying Agent in accordance with this
Section 6.01.

Notwithstanding anything herein to the contrary, any Holder delivering to the Paying Agent the
Repurchase Notice contemplated by this Section 6.01(c) of the First Supplemental Indenture shall
have the right to withdraw such Repurchase Notice at any time prior to the Close of Business on the
fifth Business Day prior to the Repurchase Date by delivery of a written notice of withdrawal to
the Paying Agent in accordance with Section 6.02(b) of the First Supplemental Indenture.

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

There shall be no purchase of any Notes pursuant to this Section 6.01 if there has occurred (prior
to, on or after, as the case may be, the giving, by the Holders of such Notes, of any Repurchase
Notice) and is continuing an Event of Default (other than a default in the payment of the
Repurchase Price).

 

 

38

     Section 6.02. Effect of Repurchase Notice.

          (a) Upon receipt by the Paying Agent of the Repurchase Notice specified in 6.01(c) of the
First Supplemental Indenture, the Holder of the Note in respect of which such Repurchase Notice was
given shall (unless such Repurchase Notice is withdrawn as specified in the following paragraph)
thereafter be entitled to receive solely the Repurchase Price, with respect to such Note. Such
Repurchase Price shall be paid to such Holder, subject to receipt of funds by the Paying Agent, on
or prior to the later of (x) the Repurchase Date, with respect to such Note (provided the
conditions in Section 6.01(c) of the First Supplemental Indenture have been satisfied) and (y) the
time of delivery of such Note to the Paying Agent by the Holder thereof in the manner required by
Section 6.01(c) of the First Supplemental Indenture. Notes in respect of which a Repurchase Notice
has been given by the Holder thereof may not be converted pursuant to Article 5 of the First
Supplemental Indenture on or after the date of the delivery of such Repurchase Notice unless such
Repurchase Notice has first been validly withdrawn as specified in the following paragraph.

          (b) A Repurchase Notice may be withdrawn by means of a written notice of withdrawal delivered
to the office of the Paying Agent in accordance with the Repurchase Notice at any time prior to the
Close of Business on the second Business Day prior to the Repurchase Date specifying:

     (i) the certificate number (or numbers) of the Note (or Notes) being withdrawn, if
Certificated Notes have been issued, or notice compliant with the relevant Depositary
procedures, if the Notes are not certificated,

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

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

     Section 6.03. Deposit of Repurchase Price. Prior to 11:00 a.m. (New York City time) on
or prior to the Repurchase Date, the Company shall deposit with the Trustee or with the Paying
Agent (or, if the Company or a Subsidiary or an Affiliate of either of them is acting as the Paying
Agent, shall segregate and hold in trust as provided in Section 10.03 of the Indenture) an amount
of money (in immediately available funds if deposited on such Business Day) sufficient to pay the
aggregate Repurchase Price of all the Notes or portions thereof which are to be purchased as of the
Repurchase Date.

If the Trustee or the Paying Agent holds money sufficient to pay the Repurchase Price of a Note, on
the Repurchase Date in accordance with the terms hereof, then, immediately after the Repurchase
Date, interest on such Note will cease to accrue, whether or not the Note is delivered to the
Trustee or the Paying Agent, and all other rights of the Holder shall terminate, other than the
right to receive the Repurchase Price upon delivery of the Note.

     Section 6.04. Notes Purchased In Part. Any Note which is to be purchased only in part
shall be surrendered at the office of the Paying Agent (with, if the Company or the Trustee so

 

 

39

requires, due endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or such Holder’s attorney duly
authorized in writing) and the Company shall execute and the Trustee shall authenticate and deliver
to the Holder of such Note, without service charge, a new Note or Notes, of any authorized
denomination as requested by such Holder in aggregate principal amount equal to, and in exchange
for, the portion of the principal amount of the Note so surrendered that is not purchased.

     Section 6.05. Covenant To Comply With Securities Laws Upon Repurchase of Notes. When
complying with the provisions of this Article Six and subject to any exemptions available under
applicable law, the Company shall:

          (a) comply in all material respects with the applicable provisions of Rule 13e-4 and Rule
14e-1 (or any successor provision and any other issuer tender offer rules) under the Exchange Act,
as then applicable;

          (b) file the related Schedule TO (or any applicable successor schedule, form or report) if
then required, or any other then required schedule, form or report, under the Exchange Act;

          (c) otherwise comply with all federal and state securities laws.

To the extent that the provisions of any securities
laws or regulations conflict with the
provisions of Article Six of the First Supplemental Indenture, the Company’s compliance with such
laws and regulations shall not in and of itself cause a breach of its obligations under Article Six
of the First Supplemental Indenture.

     Section 6.06. Repayment to the Company. The Trustee and the Paying Agent shall return
to the Company any cash that remains unclaimed for two years, subject to applicable unclaimed
property law, together with interest, if any, thereon held by them for the payment of the
Repurchase Price; provided however, that to the extent that the aggregate amount of cash deposited
by the Company pursuant to Section 6.03 of the First Supplemental Indenture exceeds the aggregate
Repurchase Price of the Notes or portions thereof which the Company is obligated to purchase as of
the Repurchase Date, then on the Business Day following the Repurchase Date, the Trustee or Paying
Agent, as applicable, shall return any such excess to the Company. Thereafter, any Holder entitled
to payment must look to the Company for payment as general creditors, unless an applicable
abandoned property law designates another Person.

ARTICLE SEVEN

MISCELLANEOUS PROVISIONS

     Section 7.01. The First Supplemental Indenture is executed by the Company, and by the Trustee
upon the Company’s request, pursuant to the provisions of Section 9.01 of the Indenture, and the
terms and conditions hereof shall be deemed to be part of the Indenture for all purposes. The
Indenture, as supplemented and amended by the First Supplemental Indenture, is in all respects
hereby adopted, ratified and confirmed. Notwithstanding the foregoing, to the extent

 

 

40

that any of the terms of the First Supplemental Indenture are inconsistent with, or conflict
with, the terms of the Indenture, the terms of the First Supplemental Indenture shall govern.

     Section 7.02. The First Supplemental Indenture may be executed in any number of counterparts,
each of which shall be an original, but such counterparts shall together constitute but one and the
same instrument.

     Section 7.03. The Trustee assumes no responsibility for the correctness of the recitals herein
contained, which shall be taken as the statements of the Company. The Trustee makes no
representations and shall have no responsibility as to the validity or sufficiency of the First
Supplemental Indenture or the due authorization and execution hereof by the Company.

     Section 7.04. The First Supplemental Indenture and each Note shall be deemed to be a contract
made under the laws of the State of New York and for all purposes shall be governed and construed
in accordance with the laws of said state, without regard to its principles of conflict of laws.

     Section 7.05. The Corporate Trust Office of the Trustee as on the date of the First
Supplemental Indenture is:

101 Barclay Street, Floor 8 West

New York, New York 10286

Attention: Corporate Trust Administration.

 

 

41

     IN WITNESS WHEREOF, the parties hereto have caused the First Supplemental Indenture to be duly
executed by their respective officers thereunto duly authorized as of the day and year first above
written.

	 	 	 	 	 
	 	FORD MOTOR COMPANY

 	 
	 	By  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

	 	 	 	 	 
	 	THE BANK OF NEW YORK

 	 
	 	By  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

 

 

Exhibit A

[Insert the Global Note Legend, if applicable pursuant to the provisions of the Indenture]

FORD MOTOR COMPANY

4.25% SENIOR CONVERTIBLE NOTE DUE 2036

 

CUSIP No. 345370 CF 5

ISIN US 345370CF51

			
	 	 	 
	$[                    ]
	 	No. R-[___]

     FORD MOTOR COMPANY, a corporation duly organized and existing under the laws of the State of
Delaware (herein called the “Company”, which term includes any successor corporation under the
Indenture hereinafter referred to), for value received, hereby promises to pay to
[                    ]or registered assigns, the principal sum of [                    ] ($[                    ]) on
December 15, 2036, or such lesser amount as may be indicated on Schedule A hereto, unless earlier
redeemed, purchased, repurchased or converted as herein provided, and to pay interest thereon from
December 15, 2006, or from the most recent Interest Payment Date to which interest has been paid or
duly provided for, semi-annually on June 15 and December 15 of each year, commencing June 15, 2007,
at the rate of 4.25% per annum, until the principal hereof is paid or made available for payment or
converted. The interest so payable, and punctually paid or duly provided for, on any Interest
Payment Date will, as provided in the Indenture, be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the Close of Business on the Regular
Record Date for such interest, which shall be June 1 or December 1 (whether or not a Business Day),
as the case may be, next preceding such Interest Payment Date. Any such interest not so punctually
paid or duly provided for will forthwith cease to be payable to the Holder on such Regular Record
Date and may either be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the Close of Business on a Special Record Date for the payment of such
Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of
Securities of this series not less than 10 days prior to such Special Record Date, or be paid at
any time in any other lawful manner not inconsistent with the requirements of any securities
exchange on which the

 

 

Securities of this series may be listed, and upon such notice as may be required by such exchange,
all as more fully provided in said Indenture.

     Interest on this Security shall be computed on the basis of a 360-day year comprised of twelve
30-day months. If interest or principal is payable on a day that is not a Business Day, the
Company shall make the payment on the next Business Day, and no interest will accrue as a result of
the delay in payment.

     Payment of the principal of (and premium, if any, on) and any such interest on this Security
will be made at the office or agency of the Company maintained for that purpose in the Borough of
Manhattan, the City and State of New York 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 and in
immediately available funds; provided, however, that each installment of interest
on this Security may, at the option of the Company, be paid by mailing a check for such interest,
payable to or upon the written order of the Person entitled thereto, to the address of such Person
as it appears on the Security Register or by wire transfer to an account of the Person entitled
thereto as such account shall be provided to the Security Registrar and shall appear on the
Security Register.

     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.

     This Security shall be deemed to be a contract made under the laws of the State of New York,
and for all purposes shall be governed by and construed in accordance with the laws of said State,
without regards to its principles of conflicts of laws.

     Unless the certificate of authentication hereon has been executed by the Trustee referred to
on the reverse hereof by manual signature, this Security shall not be entitled to any benefit under
the Indenture or be valid or obligatory for any purpose.

 

 

     IN WITNESS WHEREOF, the Company has caused this Global Security to be signed by its Chairman
of the Board, or its President, or one of its Executive Vice Presidents, or one of its Group Vice
Presidents, or one of its Vice Presidents, and by its Treasurer or one of its Assistant Treasurers,
or its Secretary or one of its Assistant Secretaries, manually or in facsimile, and a facsimile of
its corporate seal to be imprinted hereon.

Dated:

[Corporate Seal]

	 	 	 	 	 	 	 	 	 
	 	 	 	 	FORD MOTOR COMPANY	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Attest:
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 

 

 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

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

	 	 	 	 	 	 	 
	 	 	THE BANK OF NEW YORK,	 	 
	 
	 	 	 	 	 	 
	 	 	as Trustee	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 
	 	 	 	 	 	 
	Dated:
	 	 	 	 	 	 

 

 

[REVERSE SIDE OF NOTE]

Ford Motor Company

1. Indenture

     This Security is one of a duly authorized issue of securities of the Company, designated as
its 4.25% Senior Convertible Notes due 2036 (herein called the “Securities”), issued and to be
issued in one or more series under an Indenture, dated as of January 30, 2002 (herein called the
“Indenture”), between the Company and The Bank of New York (as successor trustee to JPMorgan Chase
Bank), as Trustee (herein called the “Trustee”, which term includes any successor trustee under the
Indenture with respect to the series of which this Security is a part), as supplemented by the
First Supplemental Indenture, dated as of December 15, 2006 (the “Supplemental Indenture”), between
the Company and the Trustee, to which Indenture, the Supplemental Indenture and all other
indentures supplemental thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the Trustee, and the
Holders of the Securities and of the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is a Global Security of the series designated on the
face hereof, initially limited in aggregate principal amount to $4,950,000,000. All terms used in
this Global Security which are defined in the Indenture or the Supplemental Indenture shall have
the meanings assigned to them in the Indenture or the Supplemental Indenture, as applicable. In
the event of any inconsistency between the Indenture and the Supplemental Indenture, the
Supplemental Indenture shall govern.

     The Company may, without the consent of the Holders hereof, issue additional securities having
the same ranking and the same interest rate, maturity, conversion rate and other terms as the
Securities. Any additional securities will, together with the Securities, constitute a single
series under the Indenture. No additional securities may be issued as part of the same series if
an Event of Default has occurred and is continuing with respect to the Securities.

2. Paying Agent, Conversion Agent and Security Registrar

     Initially, the Trustee will act as Paying Agent, Conversion Agent and Security Registrar. The
Company may appoint and change any Paying Agent, Conversion Agent, Security Registrar or
co-registrar without notice, other than notice to the Trustee. The Company or any of its
Subsidiaries or any of their Affiliates may act as Paying Agent, Conversion Agent, Security
Registrar or co-registrar. The Company may maintain deposit accounts and conduct other banking
transactions with the Trustee in the normal course of business.

 

 

3. Redemption at the Option of the Company

     The Securities of this series are subject to redemption upon not less than 30 nor more than 60
days’ prior notice given in the manner provided in the Indenture and the Supplemental Indenture on
December 20, 2016 or on any Business Day thereafter at a redemption price equal to 100% of the
principal amount to be redeemed together with accrued and unpaid interest thereon, up to, but not
including, the Redemption Date, but interest installments whose Stated Maturity is on or prior to
such Redemption Date will be payable to the Holders of such Securities, or one or more Predecessor
Securities, of record at the close of business on the relevant Regular Record Dates referred to on
the face hereof, all as provided in the Indenture and the Supplemental Indenture.

     In the event of redemption of this Security in part only, a new Security or Securities of this
series for the unredeemed portion hereof will be issued in the name of the Holder hereof upon the
cancellation hereof.

4. Repurchase at the Option of the Holder

     On December 20, 2016 and on December 15, 2026, subject to the terms and conditions of the
Supplemental Indenture, Holders shall have the right to require the Company to repurchase for cash
all or a portion of the Securities held by such Holder, or if any such day is not a Business Day,
on the immediately succeeding Business Day, at a purchase price equal to 100% of the principal
amount of the Securities to be purchased, plus accrued and unpaid interest to, but not including,
the Repurchase Date, as set forth, and subject to satisfaction by or on behalf of the Holder of the
requirements set forth, in Article Six of the Supplemental Indenture.

5. Repurchase at the Option of the Holder upon the Occurrence of a Designated Event

     Subject to the terms and conditions of the Supplemental Indenture, if there shall have
occurred a Designated Event, each Holder shall have the right, at such Holder’s option, to require
the Company to purchase for shares of Common Stock (or such other consideration into which the
shares of Common Stock have been converted or exchanged in connection with such Designated Event)
all or any portion of such Holder’s Securities not previously repurchased or called for redemption
in integral multiples of $1,000 principal amount on a date selected by the

 

 

Company as specified in Article Four of the Supplemental Indenture, at a purchase price equal to
100% of the principal amount of the Securities to be purchased, plus accrued and unpaid interest
to, but not including, the Purchase Date, as set forth, and subject to satisfaction by or on behalf
of the Holder of the requirements set forth, in Article Four of the Supplemental Indenture.

6. Repurchase at the Option of the Holder upon a Change in Control

     Subject to the terms and conditions of the Supplemental Indenture, if there shall have
occurred a Change in Control, each Holder shall have the right, at such Holder’s option, to require
the Company to purchase for cash all or any portion of such Holder’s Securities not previously
repurchased or called for redemption in integral multiples of $1,000 principal amount on a date
selected by the Company as specified in Article Four of the Supplemental Indenture, at a purchase
price equal to 100% of the principal amount of the Securities to be purchased, plus accrued and
unpaid interest to, but not including, the Purchase Date, as set forth, and subject to satisfaction
by or on behalf of the Holder of the requirements set forth, in Article Four of the Supplemental
Indenture.

7. Conversion

     Subject to the terms of the Supplemental Indenture, including without limitation the Company’s
right to terminate the conversion rights as provided in Section 5.02 of the Supplemental Indenture,
the Holder of this Security may, at any time and from time to time, convert this Security or any
portion of the principal amount thereof that is in an integral multiple of $1,000 into shares of
Common Stock at the Conversion Rate (initially 108.6957 shares of Common Stock for each $1,000
principal amount of Securities, subject to adjustment, in certain instances as provided in Section
5.09 of the Supplemental Indenture, and further subject to increases in certain instances, as
provided in Section 5.08 of the Supplemental Indenture) as provided in Article Five of the
Supplemental Indenture; provided, however, the Company may satisfy its obligation with respect to
any demand for conversion by delivering Common Stock, cash or a combination of cash and Common
Stock. The Conversion Rate for the Securities on any Conversion Date shall be determined as set
forth in the Supplemental Indenture. Upon conversion of this Security, the Company shall, subject
to the terms of the Supplemental Indenture, deliver the Conversion Settlement Distribution within
the time periods set forth in Section 5.04 of the Supplemental Indenture.

     The Company may, in accordance with the terms set forth in the Supplemental Indenture,
irrevocably elect to pay cash in an amount equal to the lower of (a) the Conversion Value and (b)
the aggregate principal amount of the Securities to be converted, and shares of Common Stock
representing the excess, if any, of such Conversion Value over such aggregate principal amount as
provided for in Section 5.04(d) of the Supplemental Indenture.

 

 

     No fractional shares will be issued upon conversion of a Security; the Company shall deliver
cash in lieu of any fractional share of Common Stock as provided in Section 5.05 of the
Supplemental Indenture.

     To convert a Security, a Holder must fulfill the conditions set forth in Section 5.03 of the
Supplemental Indenture.

     The Conversion Rate will be adjusted as set forth in Article Five of the Supplemental
Indenture.

8. Defeasance

     From and after the Conversion Rights Termination Date, the Notes shall be subject to the
defeasance provisions set forth in Article Fourteen of the Indenture.

9. Event of Default

     If an Event of Default with respect to Securities of this series shall occur and be
continuing, the principal of the Securities of this series may be declared, or in certain cases
become, due and payable in the manner and with the effect provided in the Indenture and the
Supplemental Indenture.

10. Amendment and Wavier

     The Indenture and Supplemental Indenture permit, 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 of this series under the Indenture and the Supplemental
Indenture at any time by the Company and the Trustee with the consent of the Holders of not less
than a majority in principal amount of the Outstanding Securities of this series. The Indenture
and Supplemental Indenture also contain provisions permitting the Holders of specified percentages
in principal amount of the Outstanding Securities of this series, on behalf of the Holders of all
Outstanding Securities of this series, to waive compliance by the Company with certain provisions
of the Indenture and Supplemental Indenture and certain past defaults under the Indenture and
Supplemental 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 the

 

 

registration of transfer hereof or in exchange or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Security. The Company and the Trustee may amend the Indenture
and the Supplemental Indenture under certain circumstances without the consent of the Holders, as
described in the Indenture and the Supplemental Indenture.

     No reference herein to the Indenture or the Supplemental Indenture and no provision of this
Security or of the Indenture or Supplemental Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the amount of principal of (and premium, if
any, on) and interest, if any, on this Security herein provided, and at the times, place and rate,
and in the coin or currency, herein prescribed.

11. Miscellaneous

     As provided in the Indenture and subject to certain limitations therein set forth,
particularly the limitation set forth in Section 2.05(b) of the Indenture, the transfer of this
Security is registrable in the Security Register, upon surrender of this Security for registration
of transfer at the office or agency of the Company in any place where the principal of (and
premium, if any, on) and interest, if any, on this Security are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing,
and thereupon one or more new Securities of this series, of authorized denominations and for the
same aggregate principal amount will be issued to the designated transferee or transferees.

     No service charge shall be made for any such registration of transfer or exchange, but the
Company may require payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.

     Prior to due presentment of this Security for registration of transfer, the Company, the
Trustee and any agent of the Company or the Trustee may treat the Person in whose name this
Security is registered as the owner hereof for all purposes, whether or not this Security be
overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.

     Upon the occurrence of an event described in Section 2.05(c) of the Indenture, the Holder
hereof shall surrender this Global Security to the Trustee for cancellation whereupon, in
accordance with said Section 2.05(c), the Company will execute and the Trustee will

 

 

authenticate and deliver Notes in definitive registered form without coupons, in denominations of
$1,000 and any integral multiple thereof, and in an aggregate principal amount equal to the
aggregate principal amount of this Global Security in exchange for this Global Security.

     Notwithstanding any other provision of the Indenture or the Supplemental Indenture, so long as
the Securities are in the form of Global Securities, the parties to the Indenture and the
Supplemental Indenture and the Holders of such Securities shall be bound at all times by the
applicable procedures of DTC.

 

 

SCHEDULE
A

SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL SECURITY

     The following exchanges of a part of this Global Security for an interest in another Global
Security, or exchanges of a part of another Global Security for an interest in this Global
Security, or for Notes in certificated form, have been made:

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

 

 

ASSIGNMENT FORM

To assign this Security, fill in the form below:

     FOR VALUE RECEIVED, the undersigned registered holder hereby sell(s), assign(s) and
transfer(s) unto
                                                     (Please insert social security or other Taxpayer Identification No. of
assignee) the within Security and all rights thereunder, and hereby irrevocably constitutes and
appoints                                                              attorney to transfer said Security on the books of the Ford Motor Company with full power
of substitution in the premises.

Please print or typewrite name and address including zip code of assignee:

	 	 	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 	 	 
	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Date:  
	 	 	 	 	 	 	 	 
	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Your 

Signature:	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	(Sign exactly as your name appears on the other side of
this Security)	 	 
	 
	 	 	 	 	 	 	 	 
	*Signature guaranteed 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.

 

 

CONVERSION NOTICE

Ford Motor Company

4.25% Senior Convertible Note due 2036

CUSIP No. 345370CF5

ISIN No. 345370CF51

To convert
this 4.25% SENIOR CONVERTIBLE NOTE DUE 2036 issued by Ford Motor Company, check the box: o

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

If you want the stock certificate, if any, made out in another person’s name or the Cash paid to another
person, fill in the form below (NOT FOR USE BY DTC PARTICIPANTS):

 

(Insert
other person’s soc. sec. or tax ID no.)

 

 

(Print or type other person’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.

USE THE FOLLOWING ONLY FOR GLOBAL BOOK ENTRY DTC PARTICIPANTS

Please designate your DTC Participant’s name and Participant Number and provide contact information below:

Name of DTC Participant:                                                             

DTC Participant Number:                          

Client
Reference No.( optional):                                                             

DTC Participant Contact Information

     Name:                                                             

     Telephone No.:                                               Facsimile No.:                                         

     Email:                                                             

Date:                                                             

Your Signature:                                                             

(Sign exactly as your name appears on the other side of this Security or as an authorized DTC Participant
representative)

*Signature
guaranteed 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.

 

 

REPURCHASE NOTICE

Ford Motor Company

4.25% Senior Convertible Note due 2036

CUSIP No. 345370CF5

ISIN No. 345370CF51

			
	TO:	 	FORD MOTOR COMPANY

THE BANK OF NEW YORK

     The undersigned registered owner of this 4.25% SENIOR CONVERTIBLE NOTE DUE 2036 hereby
irrevocably acknowledges receipt of a notice from Ford Motor Company (the “Company”) regarding the
right of Holders to elect to require the Company to purchase the Securities and requests and
instructs the Company to purchase the entire principal amount of this Security, or portion thereof
(which is $1,000 principal amount or an integral multiple thereof) designated below, in accordance
with the terms of the Indenture and the Supplemental Indenture at the price of 100% of the
principal amount or proportional portion thereof, together with accrued and unpaid interest to, but
excluding, the Repurchase Date, to the registered holder hereof. Capitalized terms used herein but
not defined shall have the meanings ascribed to such terms in the Indenture and Supplemental
Indenture referred to in such Securities. The Securities shall be purchased by the Company as of
the applicable Repurchase Date pursuant to the terms and conditions specified in the Supplemental
Indenture.

     Security
Certificate Number (if applicable):                                                        
     

     Principal
amount to be purchased (if less than all):                                  

     Social
Security or Other Taxpayer Identification Number:                                                      
       

     USE THE FOLLOWING ONLY FOR GLOBAL BOOK ENTRY DTC PARTICIPANTS

Please designate your DTC Participant’s name and Participant Number and provide contact information
below:

     Name of DTC Participant:                                                             

     DTC Participant Number:                     

     Client Reference No.( optional):                                                             

     DTC Participant Contact Information

          Name:
                                                            

          Telephone No.:                          Facsimile No.:                     

          Email:                                                             

     Date:                                         

     Your Signature:                                                             

(Sign exactly as your name appears on the other side of this Security or as an authorized DTC
Participant representative)

     *Signature guaranteed 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.

 

 

PURCHASE NOTICE UPON A DESIGNATED EVENT OR CHANGE IN CONTROL

Ford Motor Company

4.25% Senior Convertible Note due 2036

CUSIP No. 345370CF5

ISIN No. 345370CF51

			
	TO:	 	FORD MOTOR COMPANY

THE BANK OF NEW YORK

     The undersigned registered owner of this 4.25% SENIOR CONVERTIBLE NOTE DUE 2036 hereby
irrevocably acknowledges receipt of a notice from Ford Motor Company (the “Company”) regarding the
right of Holders to elect to require the Company to purchase the Securities upon the occurrence of
a Designated Event or Change in Control, as the case may be, and requests and instructs the Company
pursuant to Section 4.01 of the Supplemental Indenture to purchase the entire principal amount of
this Security, or portion thereof (which is $1,000 principal amount or an integral multiple
thereof) designated below, in accordance with the terms of the Indenture and the Supplemental
Indenture at the price of 100% of the principal amount or proportional portion thereof, together
with accrued and unpaid interest to, but not including, the Purchase Date, to the registered holder
hereof. Capitalized terms used herein but not defined shall have the meanings ascribed to such
terms in the Supplemental Indenture referred to in such Securities. The Securities shall be
purchased by the Company as of the Purchase Date pursuant to the terms and conditions specified in
the Supplemental Indenture.

     Security
Certificate Number (if applicable):                                                       
      

     Principal
amount to be purchased (if less than all):                                                            
 

     Social
Security or Other Taxpayer Identification Number:                                         

     USE THE FOLLOWING ONLY FOR GLOBAL BOOK ENTRY DTC PARTICIPANTS

Please designate your DTC Participant’s name and Participant Number and provide contact information
below:

     Name of DTC Participant:                                                             

     DTC Participant Number:                     

     Client Reference No.( optional):                                                             

     DTC Participant Contact Information

          Name:                                                           
                      

          Telephone No.:                           Facsimile No.:                     

          Email:                                         

     Date:                                         

     Your Signature:                                                             

(Sign exactly as your name appears on the other side of this Security or as an authorized DTC
Participant representative)

     *Signature guaranteed 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.exv10w33

 

EXHIBIT 10.33

SECOND AMENDMENT AGREEMENT

This Second Amendment Agreement dated as of December 12, 2006 (“Amendment”) is entered into with
reference to the Revolving Loan Agreement dated as of November 22, 2005, as amended (the “Loan
Agreement”), among KB HOME, a Delaware corporation (“Borrower”), the Banks party thereto, and Bank
of America, N.A., as Administrative Agent. Borrower and the Administrative Agent, acting on behalf
of the Required Banks under the Loan Agreement, agree to amend the Loan Agreement as follows:

	1.	 	Definitions. Capitalized terms used but not defined herein have the meanings
set forth in the Loan Agreement.
	 
	2.	 	Additional One Time Extension of Time Period to Deliver Quarterly Financials.
For the Fiscal Quarter of Borrower ended on August 31, 2006, the time period for delivering
the financial statements described in Section 7.1(a) of the Loan Agreement is extended
to the Extended Permitted Delayed Reporting Date (as defined below). This is a one-time
extension, and the time period for delivering the financial statements described in
Section 7.1(a) of the Loan Agreement for subsequent Fiscal Quarters is as set forth in
the Loan Agreement. “Extended Permitted Delayed Reporting Date” means the first to occur of:

	 	(a)	 	February 23, 2007;
	 
	 	(b)	 	the date the Borrower files the Form 10-Q with its financial statements for
the Fiscal Quarter of Borrower ended on August 31, 2006 (“Borrower’s 10-Q”) with the
Commission; and
	 
	 	(c)	 	the date the Borrower delivers financial statements for the Fiscal Quarter of
Borrower ended on August 31, 2006 to the holders of, or any trustee for, any of the
Subordinated Notes or any senior note Indebtedness (the Subordinated Notes and such
senior note Indebtedness being collectively referred to as “Covered Indebtedness”).

	3.	 	Additional One Time Extension of Time Period to Deliver Compliance
Certificate. The time period for delivering the Compliance Certificate dated as of August
31, 2006, as required by Section 7.2 of the Loan Agreement, is extended to the
Extended Permitted Delayed Reporting Date. This is a one-time extension, and the time period
for delivering subsequent Compliance Certificates is as set forth in the Loan Agreement.
	 
	4.	 	Additional One Time Consent to Late Filing of Borrower’s 10-Q and 10-K and Related
Waivers.

	 	(a)	 	Until the Extended Permitted Delayed Reporting Date, Borrower’s failure to
file with the Commission Borrower’s 10-Q or Borrower’s Form 10-K for the Fiscal Year
ended on November 30, 2006 (due February 13, 2007) (“Borrower’s 10-K”) by the
applicable deadlines specified by the Commission, for the reasons set forth in Form
12b-25 filed by the Borrower with the Commission on October 10, 2006 (“Form 12b-25”)
shall not, without more, constitute a Default or an Event of Default.
	 
	 	(b)	 	Until the Extended Permitted Delayed Reporting Date:

	 	(1)	 	Borrower’s failure to file with the Commission Borrower’s 10-Q or
Borrower’s 10-K will not constitute a Material Adverse Effect;

-1-

 

	 	(2)	 	no Event of Default under Section 9.1(g) of the Loan Agreement (and no
Material Adverse Effect) shall be deemed to have occurred as a result of any
action taken by the trustee(s) or holder(s) of the Subordinated Notes, if such
action is in response to the matters described in Part III of the Borrower’s
Form 12b-25, matters reasonably related thereto, or matters incidental thereto
that are not material to the Borrower; and
	 
	 	(3)	 	for purposes of Sections 8.2(b) and 8.3(b) of
the Loan Agreement and Section 7(a) of this Amendment, the representations and
warranties made in the Loan Agreement shall be modified to the extent caused by
matters described in Part III of the Borrower’s Form 12b-25, matters reasonably
related thereto, or matters incidental thereto that are not material to the
Borrower, and the representations and warranties deemed to be made in any Loan
Notice or Swing Line Loan Notice or Request for Letter of Credit submitted by
the Borrower shall also be deemed to be so modified.

	 	(c)	 	Administrative Agent and the Required Banks agree to the limited waivers set
forth in Sections 4(a) and 4(b) of this Amendment, it being acknowledged by Borrower
that each is a one-time waiver ending on the Extended Permitted Delayed Reporting Date.

	5.	 	Consent Fee. Borrower agrees to pay to the Administrative Agent, for the
account of each “Consenting Bank” (as defined below), a fee equal to 0.10% of the Pro Rata
Share of the Commitment held by such Consenting Bank (the “Consent Fee”). The Consent Fee
shall be payable to the Consenting Banks only if Consenting Banks constitute Required Banks
and shall be paid by Borrower promptly after receipt of consents from Required Banks. Upon
payment by Borrower, the Consent Fee received by each Consenting Bank shall be fully earned
and nonrefundable. A “Consenting Bank” is any Bank that:

	 	(a)	 	delivers to counsel for Bank of America, N.A., Kenneth J. Carl, by facsimile
(213.443.2804) or e-mail (kcarl@sheppardmullin.com), its executed “Consent of Bank” in
the form attached to this Amendment, so that it is received on or prior to 12:00 noon,
Eastern Standard Time, on December 12, 2006; and
	 
	 	(b)	 	delivers 36 manually signed counterparts of its executed “Consent of Bank” to
the following address for receipt no later than December 13, 2006:

Kenneth J. Carl

Sheppard, Mullin, Richter & Hampton llp

333 South Hope Street, 48th Floor

Los Angeles, California 90071

	6.	 	Conditions Precedent. The effectiveness of this Amendment is conditioned upon
the receipt by the Administrative Agent of:

	 	(a)	 	written consents to the execution, delivery and performance hereof from the
Required Banks under the Loan Agreement; and
	 
	 	(b)	 	the Consent Fee from the Borrower payable to each Consenting Bank.

	7.	 	Representations and Warranties. Borrower represents and warrants to the
Administrative Agent and the Banks that:

-2-

 

	 	(a)	 	Except as specifically described in Section 4 above and as otherwise provided
in this Section 7, no Default or Event of Default has occurred and remains continuing
and that each of the representations and warranties of Borrower (other
than the representations and warranties contained in Sections
4.4(a), 4.6, 4.9, 4.18 and 4.19 of the Loan
Agreement) contained in Article IV of the Loan Agreement (each as updated from
time to time in accordance with the terms of the Loan Agreement, and except that the
financial statements referred to in Section 4.7(a) of the Loan Agreement shall
be deemed to refer to the most recent financial statements delivered pursuant to
Section 7.1(a) of the Loan Agreement and the Borrowing Base Certificate
referred to in Section 4.7(b) of the Loan Agreement shall be deemed to refer to
the most recent Borrowing Base Certificate delivered pursuant to Section 2.8 of
the Loan Agreement) is true and correct in all material respects as of the date hereof
(other than those which relate by their terms solely to another date).
	 
	 	(b)	 	From May 31, 2006 to the date this Amendment becomes effective pursuant to
Section 6 hereof, no event or circumstance has occurred that constitutes a Material
Adverse Effect.
	 
	 	(c)	 	The information provided by Borrower to the Banks in connection with this
Amendment, taken as a whole, has not contained any untrue statement of a material fact
and has not omitted a material fact necessary to make the statements contained therein,
taken as a whole, not misleading under the totality of the circumstances existing at
the date such information was provided and in the context in which it was provided.

	8.	 	Notice of Material Adverse Effect. If any event or circumstance covered by
Section 4(b)(2) of this Amendment occurs, Borrower shall deliver notice to the Administrative
Agent describing such event or circumstance in reasonable detail promptly after, to the best
knowledge of Borrower, such event or circumstance occurs.
	 
	9.	 	Effect of Limited Waiver; Confirmation. Except to the limited extent
expressly set forth in this Amendment, no consent or waiver, express or implied, by the
Administrative Agent or any Bank to or for any breach of or deviation from any covenant,
condition or duty by any Loan Party may be deemed a consent or waiver to or of any other
breach of the same or any other covenant, condition or duty. In all other respects, the terms
of the Loan Agreement and the other Loan Documents are confirmed.

[signatures continued on following page]

-3-

 

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

	 	 	 	 	 
	 	KB HOME, a Delaware corporation

 	 
	 	By:  	/s/ KELLY M. ALLRED
 	 
	 
	 	Its: 	Vice President, Treasury & Risk Management 	 
	 	 	 	 
	 
	 	BANK OF AMERICA, N.A., as Administrative Agent

 	 
	 	By:  	/s/ MOLLIE S. CANUP
 	 
	 
	 	Its:  	Vice President 	 
	 	 	 	 
	 

-4-

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