Document:

Exhibit 4.4

 

THERAVANCE, INC.

 

3% CONVERTIBLE SUBORDINATED NOTES DUE 2015

 

INDENTURE

 

DATED AS OF JANUARY 23, 2008

 

THE BANK OF NEW YORK TRUST COMPANY, N.A.

 

AS TRUSTEE

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE 1

  
	
  DEFINITIONS AND
  INCORPORATION BY REFERENCE

  
	
   

  
	
  Section 1.01.

  	
  Definitions.

  	
  1

  
	
  Section 1.02.

  	
  Other Definitions.

  	
  9

  
	
  Section 1.03.

  	
  Trust Indenture Act Provisions.

  	
  11

  
	
  Section 1.04.

  	
  Rules of Construction.

  	
  11

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2

  
	
  THE SECURITIES

  
	
   

  	
   

  	
   

  
	
  Section 2.01.

  	
  Form and Dating

  	
  12

  
	
  Section 2.02.

  	
  Execution and Authentication.

  	
  13

  
	
  Section 2.03.

  	
  Registrar, Paying Agent and
  Conversion Agent.

  	
  14

  
	
  Section 2.04.

  	
  Paying Agent to Hold Money in
  Trust

  	
  15

  
	
  Section 2.05.

  	
  Lists of Holders of Securities

  	
  15

  
	
  Section 2.06.

  	
  Transfer and Exchange.

  	
  15

  
	
  Section 2.07.

  	
  Replacement Securities.

  	
  16

  
	
  Section 2.08.

  	
  Outstanding Securities.

  	
  17

  
	
  Section 2.09.

  	
  Treasury Securities

  	
  17

  
	
  Section 2.10.

  	
  Temporary Securities

  	
  18

  
	
  Section 2.11.

  	
  Cancellation

  	
  18

  
	
  Section 2.12.

  	
  Additional Transfer and
  Exchange Requirements.

  	
  18

  
	
  Section 2.13.

  	
  CUSIP Numbers

  	
  20

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3

  
	
  REDEMPTION

  
	
   

  	
   

  	
   

  
	
  Section 3.01.

  	
  Right to Redeem; Notices to
  Trustee

  	
  21

  
	
  Section 3.02.

  	
  Selection of Securities to be
  Redeemed

  	
  21

  
	
  Section 3.03.

  	
  Notice of Redemption

  	
  22

  
	
  Section 3.04.

  	
  Effect of Notice of Redemption

  	
  23

  
	
  Section 3.05.

  	
  Deposit of Redemption Price

  	
  23

  
	
  Section 3.06.

  	
  Securities Redeemed in Part

  	
  23

  
	
  Section 3.07.

  	
  No Requirement to Register

  	
  23

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4

  
	
  PURCHASE

  
	
   

  	
   

  	
   

  
	
  Section 4.01.

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

  	
  23

  

 

i

 

	
  Section 4.02.

  	
  Effect of Fundamental Change
  Repurchase Notice.

  	
  26

  
	
  Section 4.03.

  	
  Deposit of Fundamental Change
  Repurchase Price.

  	
  27

  
	
  Section 4.04.

  	
  Repayment to the Company

  	
  27

  
	
  Section 4.05.

  	
  Securities Purchased in Part

  	
  27

  
	
  Section 4.06.

  	
  Compliance with Securities Laws
  upon Purchase of Securities

  	
  28

  
	
  Section 4.07.

  	
  Purchase of Securities in Open
  Market

  	
  28

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5

  
	
  CONVERSION

  
	
   

  
	
  Section 5.01.

  	
  Conversion Privilege and
  Conversion Rate.

  	
  28

  
	
  Section 5.02.

  	
  Conversion Procedure.

  	
  30

  
	
  Section 5.03.

  	
  Fractional Shares

  	
  31

  
	
  Section 5.04.

  	
  Taxes on Conversion

  	
  32

  
	
  Section 5.05.

  	
  Company to Provide Stock.

  	
  32

  
	
  Section 5.06.

  	
  Adjustment of Conversion Rate.

  	
  32

  
	
  Section 5.07.

  	
  No Adjustment.

  	
  40

  
	
  Section 5.08.

  	
  Notice of Adjustment

  	
  40

  
	
  Section 5.09.

  	
  Notice of Certain Transactions

  	
  41

  
	
  Section 5.10.

  	
  Effect of Recapitalization,
  Reclassification, Consolidation, Merger or Sale

  	
  41

  
	
  Section 5.11.

  	
  Trustee’s Disclaimer.

  	
  42

  
	
  Section 5.12.

  	
  Voluntary Increase

  	
  42

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6

  
	
  SUBORDINATION

  
	
   

  
	
  Section 6.01.

  	
  Agreement of Subordination

  	
  43

  
	
  Section 6.02.

  	
  Payments to Holders

  	
  43

  
	
  Section 6.03.

  	
  Subrogation of Securities

  	
  45

  
	
  Section 6.04.

  	
  Authorization to Effect
  Subordination

  	
  47

  
	
  Section 6.05.

  	
  Notice to Trustee

  	
  47

  
	
  Section 6.06.

  	
  Trustee’s Relation to Senior
  Indebtedness

  	
  48

  
	
  Section 6.07.

  	
  No Impairment of Subordination

  	
  48

  
	
  Section 6.08.

  	
  Certain Conversions Deemed
  Payment

  	
  48

  
	
  Section 6.09.

  	
  Article Applicable to
  Paying Agents

  	
  49

  
	
  Section 6.10.

  	
  Senior Indebtedness Entitled to
  Rely

  	
  49

  
	
  Section 6.11.

  	
  Reliance on Judicial Order or
  Certificate of Liquidating Agent

  	
  49

  
	
  Section 6.12.

  	
  Rights of Trustee as Holder of
  Senior Indebtedness; Preservation of Trustee’s Rights

  	
  49

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7

  
	
  COVENANTS

  
	
   

  	
   

  	
   

  
	
  Section 7.01.

  	
  Payment of Securities.

  	
  49

  
	
  Section 7.02.

  	
  SEC and Other Reports.

  	
  50

  
	
  Section 7.03.

  	
  Compliance Certificates

  	
  51

  
	
  Section 7.04.

  	
  Further Instruments and Acts

  	
  51

  

 

ii

 

	
  Section 7.05.

  	
  Maintenance of Corporate
  Existence

  	
  51

  
	
  Section 7.06.

  	
  Stay, Extension and Usury Laws

  	
  51

  
	
  Section 7.07.

  	
  Maintenance of Office or Agency

  	
  51

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8

  
	
  CONSOLIDATION;
  MERGER; CONVEYANCE; TRANSFER OR LEASE

  
	
   

  
	
  Section 8.01.

  	
  Company May Consolidate,
  Etc., Only on Certain Terms

  	
  52

  
	
  Section 8.02.

  	
  Successor Substituted

  	
  53

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9

  
	
  DEFAULT AND REMEDIES

  
	
   

  	
   

  	
   

  
	
  Section 9.01.

  	
  Events of Default.

  	
  53

  
	
  Section 9.02.

  	
  Acceleration

  	
  55

  
	
  Section 9.03.

  	
  Other Remedies.

  	
  56

  
	
  Section 9.04.

  	
  Waiver of Defaults and Events
  of Default

  	
  56

  
	
  Section 9.05.

  	
  Control by Majority

  	
  56

  
	
  Section 9.06.

  	
  Limitations on Suits.

  	
  57

  
	
  Section 9.07.

  	
  Rights of Holders to Receive
  Payment and to Convert

  	
  57

  
	
  Section 9.08.

  	
  Collection Suit by Trustee

  	
  57

  
	
  Section 9.09.

  	
  Trustee May File Proofs of
  Claim

  	
  58

  
	
  Section 9.10.

  	
  Priorities.

  	
  58

  
	
  Section 9.11.

  	
  Undertaking for Costs

  	
  58

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10

  
	
  TRUSTEE

  
	
   

  	
   

  	
   

  
	
  Section 10.01.

  	
  Obligations of Trustee.

  	
  59

  
	
  Section 10.02.

  	
  Rights of Trustee.

  	
  60

  
	
  Section 10.03.

  	
  Individual Rights of Trustee

  	
  62

  
	
  Section 10.04.

  	
  Trustee’s Disclaimer

  	
  62

  
	
  Section 10.05.

  	
  Notice of Default or Events of
  Default

  	
  62

  
	
  Section 10.06.

  	
  Reports by Trustee to Holders.

  	
  62

  
	
  Section 10.07.

  	
  Compensation and Indemnity.

  	
  62

  
	
  Section 10.08.

  	
  Replacement of Trustee.

  	
  63

  
	
  Section 10.09.

  	
  Successor Trustee by Merger,
  Etc

  	
  64

  
	
  Section 10.10.

  	
  Eligibility; Disqualification

  	
  64

  
	
  Section 10.11.

  	
  Preferential Collection of
  Claims Against Company

  	
  65

  
	
   

  	
   

  	
   

  
	
  ARTICLE 11

  
	
  SATISFACTION AND
  DISCHARGE OF INDENTURE

  
	
   

  	
   

  	
   

  
	
  Section 11.01.

  	
  Satisfaction and Discharge of
  Indenture.

  	
  65

  
	
  Section 11.02.

  	
  Application of Trust Money

  	
  66

  
	
  Section 11.03.

  	
  Repayment to Company.

  	
  66

  
	
  Section 11.04.

  	
  Reinstatement

  	
  66

  

 

iii

 

	
  ARTICLE 12

  
	
  AMENDMENTS;
  SUPPLEMENTS AND WAIVERS

  
	
   

  
	
  Section 12.01.

  	
  Without Consent of Holders.

  	
  67

  
	
  Section 12.02.

  	
  With Consent of Holders.

  	
  67

  
	
  Section 12.03.

  	
  Compliance with Trust Indenture
  Act

  	
  68

  
	
  Section 12.04.

  	
  Revocation and Effect of
  Consents.

  	
  68

  
	
  Section 12.05.

  	
  Notation on or Exchange of
  Securities

  	
  69

  
	
  Section 12.06.

  	
  Trustee to Sign Amendments, Etc

  	
  69

  
	
  Section 12.07.

  	
  Effect of Supplemental
  Indentures

  	
  69

  
	
   

  	
   

  	
   

  
	
  ARTICLE 13

  
	
  MISCELLANEOUS

  
	
   

  	
   

  	
   

  
	
  Section 13.01.

  	
  Trust Indenture Act Controls

  	
  69

  
	
  Section 13.02.

  	
  Notices

  	
  69

  
	
  Section 13.03.

  	
  Communications by Holders with
  Other Holders

  	
  71

  
	
  Section 13.04.

  	
  Certificate and Opinion as to
  Conditions Precedent.

  	
  71

  
	
  Section 13.05.

  	
  Record Date for Vote or Consent
  of Holders of Securities

  	
  72

  
	
  Section 13.06.

  	
  Rules by Trustee, Paying
  Agent, Registrar and Conversion Agent

  	
  72

  
	
  Section 13.07.

  	
  Legal Holidays

  	
  72

  
	
  Section 13.08.

  	
  Governing Law

  	
  72

  
	
  Section 13.09.

  	
  No Adverse Interpretation of
  Other Agreements

  	
  72

  
	
  Section 13.10.

  	
  No Recourse Against Others

  	
  72

  
	
  Section 13.11.

  	
  No Security Interest Created

  	
  72

  
	
  Section 13.12.

  	
  Successors

  	
  73

  
	
  Section 13.13.

  	
  Multiple Counterparts

  	
  73

  
	
  Section 13.14.

  	
  Separability

  	
  73

  
	
  Section 13.15.

  	
  Table of Contents, Headings,
  Etc

  	
  73

  
	
  Section 13.16.

  	
  Waiver of Jury Trial

  	
  73

  
	
  Section 13.17.

  	
  Force Majeure

  	
  73

  
	
   

  	
   

  	
   

  
	
  Exhibit A

  	
   

  	
  A-1

  

 

iv

 

CROSS REFERENCE TABLE*

 

	
  TIA Section

  	
   

  	
  Indenture Section

  
	
   

  	
   

  	
   

  
	
  Section 310

  	
   

  	
  13.01

  
	
  310(a)(1)

  	
   

  	
  10.10

  
	
  (a)(2)

  	
   

  	
  10.10

  
	
  (a)(3)

  	
   

  	
  N/A

  
	
  (a)(4)

  	
   

  	
  N/A

  
	
  (a)(5)

  	
   

  	
  10.10

  
	
  (b)

  	
   

  	
  10.10

  
	
  (c)

  	
   

  	
  N/A

  
	
   

  	
   

  	
   

  
	
  Section 311

  	
   

  	
  13.01

  
	
  311(a)

  	
   

  	
  10.11

  
	
  (b)

  	
   

  	
  10.11

  
	
  (c)

  	
   

  	
  N/A

  
	
   

  	
   

  	
   

  
	
  Section 312

  	
   

  	
  13.01

  
	
  312(a)

  	
   

  	
  N/A

  
	
  (b)

  	
   

  	
  13.03

  
	
  (c)

  	
   

  	
  13.03

  
	
   

  	
   

  	
   

  
	
  Section 313

  	
   

  	
  13.01

  
	
  313(a)

  	
   

  	
  10.06(a)

  
	
  (b)(1)

  	
   

  	
  N/A

  
	
  (b)(2)

  	
   

  	
  10.06(a)

  
	
  (c)

  	
   

  	
  10.06(a)

  
	
  (d)

  	
   

  	
  10.06(a)

  
	
   

  	
   

  	
   

  
	
  Section 314

  	
   

  	
  13.01

  
	
  314(a)

  	
   

  	
  7.02(a)

  
	
  (b)

  	
   

  	
  N/A

  
	
  (c)(1)

  	
   

  	
  13.04

  
	
  (c)(2)

  	
   

  	
  13.04

  
	
  (c)(3)

  	
   

  	
  N/A

  
	
  (d)

  	
   

  	
  N/A

  
	
  (e)

  	
   

  	
  13.04

  
	
  (f)

  	
   

  	
  N/A

  
	
   

  	
   

  	
   

  
	
  Section 315

  	
   

  	
  13.01

  
	
  315(a)

  	
   

  	
  10.01(b)

  
	
  (b)

  	
   

  	
  10.05

  
	
  (c)

  	
   

  	
  10.01(a)

  
	
  (d)(1)

  	
   

  	
  10.01(d)

  

 

v

 

	
  TIA Section

  	
   

  	
  Indenture Section

  
	
   

  	
   

  	
   

  
	
  (d)(2)

  	
   

  	
  10.01(d)

  
	
  (d)(3)

  	
   

  	
  10.01(d)

  
	
  (e)

  	
   

  	
  9.11

  
	
   

  	
   

  	
   

  
	
  Section 316

  	
   

  	
  13.01

  
	
  316(a)

  	
   

  	
  2.09

  
	
  316(a)(1)(A)

  	
   

  	
  9.05

  
	
  316(a)(1)(B)

  	
   

  	
  9.04

  
	
  316(a)(2)

  	
   

  	
  N/A

  
	
  (b)

  	
   

  	
  9.07

  
	
  (c)

  	
   

  	
  13.05

  
	
   

  	
   

  	
   

  
	
  Section 317

  	
   

  	
  13.01

  
	
  317(a)(1)

  	
   

  	
  9.08

  
	
  317(a)(2)

  	
   

  	
  9.09

  
	
  317(b)

  	
   

  	
  2.04

  
	
   

  	
   

  	
   

  
	
  Section 318(a)

  	
   

  	
  13.01

  
	
  318(c)

  	
   

  	
  13.01

  

 

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

** N.A.  means Not Applicable

 

vi

 

THIS INDENTURE dated as of January 23, 2008 is between Theravance, Inc.,
a corporation duly organized under the laws of the State of Delaware (the
“Company”), and The Bank of New York Trust Company, N.A., a national banking
association duly organized and existing under the laws of the United States of
America, as Trustee (the “Trustee”).

 

In consideration of the purchase of the Securities (as defined herein)
by the Holders thereof, both parties agree as follows for the benefit of the
other and for the equal and ratable benefit of the Holders of the Company’s 3%
Convertible Subordinated Notes Due 2015.

 

ARTICLE 1

DEFINITIONS AND INCORPORATION BY REFERENCE

 

Section 1.01.  Definitions.

 

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

 

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

 

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

 

“Beneficial Ownership” means the definition such term is given in
accordance with Rule 13d-3 promulgated by the SEC under the Exchange Act.

 

“Board of Directors” means either the board of directors of the Company
or any committee of the Board of Directors authorized to act for it with
respect to this Indenture.

 

“Business Day” means any weekday that is not a day on which banking
institutions in the City of New York are authorized or obligated to close.

 

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

 

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

 

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

 

 

“Change of Control” means the occurrence of any of the following after
the original issuance of the Securities: (i) the acquisition by any Person
of Beneficial Ownership, directly or indirectly, through a purchase, merger or
other acquisition transaction or series of transactions, of shares of the
Company’s Capital Stock entitling that Person to exercise 50% or more of the
total voting power of all shares of the Company’s Capital Stock entitled to
vote generally in elections of directors, other than any acquisition by the
Company, any of its subsidiaries or any of its employee benefit plans; (ii) the
consolidation or merger of the Company with or into any other Person, any
merger of another Person into the Company, any reclassification or
recapitalization, or any conveyance, transfer, sale, lease or other disposition
of all or substantially all of the Company’s properties and assets to another
Person other than to one or more of the Company’s wholly-owned subsidiaries, provided that this clause (ii) shall not apply to (A) any
transaction (x) that does not result in any reclassification, conversion,
exchange or cancellation of outstanding shares of the Company’s Capital Stock
and (y) pursuant to which holders of the Company’s Capital Stock
immediately prior to the transaction have the entitlement to exercise, directly
or indirectly, 50% or more of the total voting power of all shares of the
Company’s Capital Stock entitled to vote generally in elections of directors of
the continuing or surviving Person immediately after the transaction; or (B) any
merger solely for the purpose of changing the Company’s jurisdiction of
incorporation and resulting in a reclassification, conversion or exchange of
outstanding shares of Common Stock solely into shares of common stock of the
surviving entity; (iii) if, during any consecutive two-year period,
individuals who at the beginning of that two-year period constituted the
Company’s Board of Directors, together with any new directors whose election to
the Company’s Board of Directors, or whose nomination for election by the
Company’s stockholders, was approved by a vote of a majority of the directors
then still in office who were either directors at the beginning of such period
or whose election or nomination for election was previously so approved, cease
for any reason to constitute a majority of the Company’s Board of Directors
then in office; or (iv) the stockholders of the Company pass a resolution
approving a plan of liquidation or dissolution. 
Notwithstanding anything to the contrary set forth herein, it will not
otherwise constitute a Change of Control if at least 90% of the consideration
for the Common Stock (excluding cash payments for fractional shares and cash
payments made in respect of dissenters’ appraisal rights) in the transaction or
transactions constituting a Change of Control consists of common stock or
American Depositary Shares representing shares of common stock, in each case
which are traded on a U.S. national securities exchange, or which will be so
traded or quoted when issued or exchanged in connection with the Change of
Control, and as a result of such transaction or transactions the Securities
become convertible solely into such consideration; provided that, with respect
to an entity organized under the laws of a jurisdiction outside the United
States, such entity has a worldwide total market capitalization (calculated in
U.S. dollars) of its equity securities of at least two times the market
capitalization of the Company before giving effect to the consolidation or
merger.

 

“Closing Price” means on any Trading Day, the reported last sale price
per share (or if no last sale price is reported, the average of the bid and ask
prices per share or, if more than one in either case, the average of the
average bid and the average ask prices per share) on such date reported by the
Nasdaq Global Market or, if the Common Stock (or the applicable security) is
not quoted on the Nasdaq Global Market, as reported by the principal national
securities 

 

2

 

exchange on which the Common Stock (or such
other security) is listed, or if no such prices are available, the Closing
Price per share shall be the fair value of a share of Common Stock (or such
other security) as reasonably determined by the Board of Directors (which
determination shall be conclusive and shall be evidenced by an Officers’
Certificate delivered to the Trustee).

 

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

 

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

 

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

 

“Conversion Rate” means the rate at which shares of Common Stock shall
be delivered upon conversion, which rate shall be initially 38.6548 shares of
Common Stock for each $1,000 principal amount of Securities, as adjusted from
time to time pursuant to the provisions of this Indenture.

 

“Corporate Trust Office” means the principal office of the Trustee at
which at any time its corporate trust business shall be administered, which
office at the date hereof is located at 700 South Flower Street, Suite 500,
Los Angeles, CA 90017, Attention: Corporate Unit, or such other address as the
Trustee may designate from time to time by notice to the Holders and the
Company, or the principal corporate trust office of any successor Trustee (or
such other address as such successor Trustee may designate from time to time by
notice to the Holders and the Company).

 

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

 

“Designated Senior Indebtedness” means the Company’s obligations under
any particular Senior Indebtedness in which the instrument creating or
evidencing the same or the assumption 

 

3

 

or guarantee thereof (or related agreements
or documents to which the Company is a party) expressly provides that such
Indebtedness shall be “Designated Senior Indebtedness” for purposes of this Indenture
(provided that such instrument, agreement
or other document may place limitations and conditions on the right of such
Senior Indebtedness to exercise the rights of Designated Senior
Indebtedness).  If any payment made to
any holder of any Designated Senior Indebtedness or its representative with
respect to such Designated Senior Indebtedness is rescinded or must otherwise
be returned by such holder or representative of such holder upon the
insolvency, bankruptcy or reorganization of the Company or otherwise, the
reinstated Indebtedness of the Company arising as a result of such rescission
or return shall constitute Designated Senior Indebtedness effective as of the
date of such rescission or return.

 

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

 

“Final Maturity Date” means January 15, 2015.

 

“Fundamental Change” means the occurrence of a Change of Control or a
Termination of Trading following the original issuance of the Securities.

 

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

 

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

 

“GAAP” means generally accepted accounting principles in the United
States of America as in effect from time to time, including those set forth in (i) the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants, (ii) the statements and
pronouncements of the Financial Accounting Standards Board, (iii) such
other statements by such other entity as approved by a significant segment of
the accounting profession and (iv) the rules and regulations of the
SEC governing the inclusion of financial statements (including pro forma
financial statements) in registration statements filed under the Securities Act
and periodic reports required to be filed pursuant to Section 13 of the
Exchange Act, including opinions and pronouncements in staff accounting
bulletins and similar written statements from the accounting staff of the SEC.

 

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

 

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

 

4

 

“Indebtedness” means, without duplication:

 

(i)    all of the Company’s indebtedness, obligations and other
liabilities (contingent or otherwise) for borrowed money (including obligations
in respect of overdrafts, foreign exchange contracts, currency exchange
agreements, interest rate protection agreements, and any loans or advances from
banks, whether or not evidenced by notes or similar instruments) or evidenced
by credit or loan agreements, bonds, debentures, notes or similar instruments
(whether or not the recourse of the lender is to the whole of the Company’s
assets or to only a portion thereof), other than any trade accounts payable or
other accrued current expense incurred in the ordinary course of business in
connection with the obtaining of materials or services;

 

(ii)   all of the Company’s reimbursement obligations and other
liabilities (contingent or otherwise) with respect to letters of credit, bank
guarantees or bankers’ acceptances;

 

(iii)  all of the Company’s obligations and liabilities (contingent or
otherwise)

 

(A)     in respect of leases required, in conformity with GAAP, to be
accounted for as capitalized lease obligations on the Company’s balance sheet,

 

(B)      as lessee under other leases for facilities equipment (and
related assets leased together therewith), whether or not capitalized, entered
into or leased for financing purposes (as determined by the Company), or

 

(C)      under any lease or related document (including a purchase
agreement) in connection with the lease of real property or improvements (or
any personal property included as part of any such lease) that provides that
the Company is contractually obligated to purchase or cause a third party to
purchase the leased property and thereby guarantee a minimum residual value of
the leased property to the lessor and all of the Company’s obligations under
such lease or related document to purchase or to cause a third party to
purchase such leased property, (whether or not such lease transaction is
characterized as an operating lease or a capitalized lease in accordance with
GAAP);

 

(iv)  all of the Company’s obligations (contingent or otherwise) with
respect to an interest rate, currency or other swap, cap, floor or collar
agreement, hedge agreement, forward contract, or other similar instrument or
foreign currency hedge, exchange, purchase or similar instrument or agreement;

 

(v)   all of the Company’s direct or indirect guarantees, agreements to
be jointly liable or similar agreements in respect of, and obligations or
liabilities (contingent or otherwise) to purchase or otherwise acquire or
otherwise assure a creditor against loss in respect of, indebtedness,
obligations or liabilities of another person of the kind described in clauses (i) through
(iv);

 

5

 

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

 

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

 

“Indenture” means this Indenture as amended
or supplemented from time to time pursuant to the terms of this Indenture,
including the provisions of the TIA that are automatically deemed to be a part
of this Indenture by operation of the TIA.

 

“Interest Payment Date” means January 15
and July 15 of each year, commencing July 15, 2008.

 

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

 

“Last Reported Sale Price” on any date means the closing sale price per
share of the Common Stock (or if no closing sale price is reported, the average
of the bid and ask prices or, if more than one in either case, the average of
the average bid and the average asked prices) on that date as reported in
composite transactions for the principal U.S. 
national or regional securities exchange on which the Common Stock is
listed for trading.  If the Common Stock
is not listed for trading on a U.S. 
national or regional securities exchange on the relevant date, the “Last
Reported Sale Price” will be the last quoted bid price for the Common Stock in
the over-the-counter market on the relevant date as reported by the National
Quotation Bureau or similar organization. 
If the Common Stock is not so quoted, the “Last Reported Sale Price”
will be the average of the mid-point of the last bid and ask prices for the
Common Stock on the relevant date from each of at least three nationally
recognized independent investment banking firms selected by the Company for
this purpose.

 

“Officer” means the Chairman of the Board,
the Chief Executive Officer, the President, any Senior Vice President, the
Chief Financial Officer, the Controller, the Secretary, or any Assistant
Controller or any Assistant Secretary of the Company designated by one of the
former officers.

 

“Officers’ Certificate” means a certificate
signed on behalf of the Company by two Officers; provided,
however, that for purposes of Sections 5.11 and 7.03, “Officers’
Certificate” means a certificate signed by (a) the principal executive
officer, principal financial officer or principal accounting officer of the
Company and (b) one other officer.

 

“Opinion of Counsel” means a written opinion
from legal counsel.  The counsel may be
an employee of or counsel to the Company.

 

6

 

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

 

“Principal” or “principal” of a debt
security, including the Securities, means the principal of the security plus,
when appropriate, the premium, if any, on the security.

 

“Redemption Date” shall mean the date
specified for redemption of the Securities in accordance with the terms of the
Securities and Article 3 hereof.

 

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

 

“Responsible Officer” means, when used with
respect to the Trustee, any officer within the corporate trust services
department of the Trustee with direct responsibility for the administration of
this Indenture and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of such
person’s knowledge of and familiarity with the particular subject and who shall
have direct responsibility for the administration of this Indenture.

 

“SEC” means the Securities and Exchange
Commission.

 

“Securities” means the up to $150,000,000
aggregate principal amount ($172,500,000 aggregate principal amount if the
Underwriters exercise their over-allotment option to purchase up to an
additional $22,500,000 aggregate principal amount of notes in full) of 3%
Convertible Subordinated Notes due 2015, or any of them (each a “Security”), as
amended or supplemented from time to time, that are issued under this
Indenture.

 

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

 

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

 

“Senior Indebtedness” means the principal of,
premium, if any, interest (including all interest accruing subsequent to the
commencement of any bankruptcy or similar proceeding, whether or not a claim
for postpetition interest is allowable as a claim in any such proceeding) and
rent payable on or in connection with, and all fees, costs, expenses and other
amounts accrued or due on or in connection with, Indebtedness of the Company,
whether secured or unsecured, absolute or contingent, due or to become due,
outstanding on the date of this Indenture or thereafter created, incurred,
assumed, guaranteed or in effect guaranteed by the Company, including all
deferrals, renewals, extensions or refundings of, or amendments, modifications
or supplements to, the foregoing, unless in the case of any particular
Indebtedness the instrument creating or evidencing the same or the assumption
or guarantee thereof expressly 

 

7

 

provides that such Indebtedness shall not be
senior in right of payment to the Securities or expressly provides that such
Indebtedness is on the same basis or junior to the Securities.  Senior Indebtedness does not include:

 

(i)            Indebtedness
that expressly provides that such Indebtedness shall not be senior in right of
payment to the Securities or expressly provides that such Indebtedness is on
the same basis or junior in right of payment to the Securities;

 

(ii)           Indebtedness
that is expressly subordinated to any Senior Indebtedness;

 

(iii)          Indebtedness
subordinated by operation of law;

 

(iv)          trade
payables and accrued expenses of the Company (including, without limitation,
accrued compensation and accrued restructuring charges) or deferred purchase
price for goods, service or materials purchased or provided in the ordinary
course of business;

 

(v)           lease
obligations other than those described in clause (iii) of the definition
of “Indebtedness” above;

 

(vi)          any
Indebtedness of the Company to or among any of its subsidiaries; and

 

(vii)         any
obligation for federal, state, local or other taxes.

 

“Stock Price” means the price paid, or deemed
to be paid, per share of the Common Stock in connection with a Fundamental
Change as determined pursuant to Section 4.01(e).

 

“Subsidiary” means, in respect of any Person, any corporation,
association, partnership or other business entity of which more than 50% of the
total voting power of shares of Capital Stock or other interests (including
partnership interests) entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers, general partners
or trustees thereof is at the time owned or controlled, directly or indirectly,
by (a) such Person; (b) such Person and one or more Subsidiaries of
such Person; or (c) one or more Subsidiaries of such Person.

 

“Termination of Trading” means the
termination (but not the temporary suspension) of trading of the Common Stock,
which will be deemed to have occurred if the Common Stock or other common stock
into which the Securities are convertible is neither listed for trading on a
United States national securities exchange nor approved for listing on any
United States system of automated dissemination of quotations of securities
prices, or traded in over-the-counter securities markets, and no American
Depository Shares or similar instruments for such Common Stock or such other
common stock into which the Securities are convertible are so listed or
approved for listing in the United States.

 

“TIA” means the Trust Indenture Act of 1939,
as amended, and the rules and regulations thereunder as in effect on the
date of this Indenture, except to the extent that the Trust Indenture 

 

8

 

Act or any amendment thereto expressly provides for application of the
Trust Indenture Act as in effect on another date.

 

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

 

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

 

“Underwriters” means Merrill Lynch, Pierce,
Fenner & Smith Incorporated and Goldman, Sachs & Co.

 

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

 

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

 

Section 1.02.  Other Definitions.

 

	
  Term

  	
   

  	
  Defined in

  Section

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Agent Members”

  	
   

  	
  2.01

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Bankruptcy Law”

  	
   

  	
  9.01

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Business
  Combination”

  	
   

  	
  5.10

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Company Order”

  	
   

  	
  2.02

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Conversion
  Agent”

  	
   

  	
  2.03

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Conversion
  Date”

  	
   

  	
  5.02

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Current Market
  Price”

  	
   

  	
  5.06

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “DTC”

  	
   

  	
  2.01

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Depositary”

  	
   

  	
  2.01

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Determination
  Date”

  	
   

  	
  5.06

  	
   

  

 

9

 

	
  Term

  	
   

  	
  Defined in

  Section

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Distributed
  Securities”

  	
   

  	
  5.06

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Event of
  Default”

  	
   

  	
  9.01

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Expiration
  Date”

  	
   

  	
  5.06

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Expiration
  Time”

  	
   

  	
  5.06

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Fundamental
  Change Company Notice”

  	
   

  	
  4.01

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Fundamental
  Change Repurchase Date”

  	
   

  	
  4.01

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Fundamental
  Change Repurchase Notice”

  	
   

  	
  4.01

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Legal Holiday”

  	
   

  	
  13.07

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Legend”

  	
   

  	
  2.12

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Make Whole
  Premium”

  	
   

  	
  5.01

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Notice of
  Default”

  	
   

  	
  9.01

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Paying Agent”

  	
   

  	
  2.03

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Payment
  Blockage Notice”

  	
   

  	
  6.02

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Primary
  Registrar”

  	
   

  	
  2.03

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Purchase
  Agreement”

  	
   

  	
  2.01

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Purchased
  Shares”

  	
   

  	
  5.06

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “record date”

  	
   

  	
  5.06

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Receiver”

  	
   

  	
  9.01

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Redemption
  Price”

  	
   

  	
  4.01(b)

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Registrar”

  	
   

  	
  2.03

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Resale
  Restriction Termination Date”

  	
   

  	
  2.12

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Rights”

  	
   

  	
  5.06

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Rights Plan”

  	
   

  	
  5.06

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Spinoff
  Securities”

  	
   

  	
  5.06

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Spinoff Valuation
  Period”

  	
   

  	
  5.06

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “tender offer”

  	
   

  	
  5.06

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Triggering
  Distribution”

  	
   

  	
  5.06

  	
   

  

 

10

 

Section 1.03.  Trust Indenture Act
Provisions.

 

Whenever this Indenture refers to a provision
of the TIA, that provision is incorporated by reference in and made a part of
this Indenture.  This Indenture shall
also include those provisions of the TIA required to be included herein by the
provisions of the Trust Indenture Reform Act of 1990.  The following TIA terms used in this
Indenture have the following meanings:

 

“indenture securities” means the Securities;

 

“indenture security holder” means a Holder of
a Security;

 

“indenture to be qualified” means this
Indenture;

 

“indenture trustee” or “institutional
trustee” means the Trustee; and

 

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

 

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

 

Section 1.04.  Rules of Construction.

 

(a)        Unless the context otherwise requires:

 

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

 

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

 

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

 

(iv)          provisions apply to successive events and transactions;

 

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

 

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

 

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

 

11

 

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

 

ARTICLE 2

THE SECURITIES

 

Section 2.01.  Form and Dating.  The Securities and the Trustee’s
certificate of authentication shall be substantially in the respective forms
set forth in Exhibit A which Exhibit is incorporated in and
made part of this Indenture.  The
Securities may have notations, legends or endorsements required by law, stock
exchange or automated quotation system rule or regulation or usage.  The Company shall provide any such notations,
legends or endorsements to the Trustee in writing.  Each Security shall be dated the date of its
authentication.  The Securities are being
offered and sold by the Company pursuant to a Purchase Agreement dated January 16,
2008 (the “Purchase Agreement”) between the Company and the Underwriters.  The terms and provisions contained in the
Securities shall constitute, and are hereby expressly made, a part of this
Indenture, and the Company and the Trustee, by their execution and delivery of
this Indenture, expressly agree to such terms and provisions and to be bound
thereby.  However, to the extent any
provision of any Security conflicts with the express provisions of this Indenture,
the provisions of this Indenture shall govern and be controlling.

 

(a)        Global Securities.  All of the Securities shall be issued
initially in the form of one or more Global Securities, which shall be
deposited on behalf of the purchasers of the securities represented thereby
with the Trustee, at its Corporate Trust Office, as custodian for the
depositary, The Depository Trust Company (“DTC”, and such depositary, or any
successor thereto, being hereinafter referred to as the “Depositary”), and
registered in the name of its nominee, Cede & Co.  (or any successor thereto), for the accounts
of participants in the Depositary, duly executed by the Company and
authenticated by the Trustee as hereinafter provided.

 

(b)        Global Securities in
General.  Each Global Security
shall represent such of the outstanding Securities as shall be specified
therein and each shall provide that it shall represent the aggregate amount of
outstanding Securities from time to time endorsed thereon and that the
aggregate amount of outstanding Securities represented thereby may from time to
time be reduced or increased, as appropriate, to reflect replacements,
exchanges, redemption, purchases or conversions of such Securities.  Any adjustment of the aggregate principal
amount of a Global Security to reflect the amount of any increase or decrease
in the amount of outstanding Securities represented thereby shall be made by
the Trustee in accordance with instructions given by the Holder thereof as
required by Section 2.12 and shall be made on the records of the Trustee
and the Depositary.

 

Members of, or participants in, the Depositary (“Agent Members”) shall
have no rights under this Indenture with respect to any Global Security held on
their behalf by the Depositary or 

 

12

 

under the Global Security, and the Depositary
(including, for this purpose, its nominee) may be treated by the Company, the
Trustee and any agent of the Company or the Trustee as the absolute owner and
Holder of such Global Security for all purposes whatsoever.  Notwithstanding the foregoing, nothing herein
shall (i) prevent the Company, the Trustee or any agent of the Company or
the Trustee from giving effect to any written certification, proxy or other
authorization furnished by the Depositary or (ii) impair, as between the
Depositary and its Agent Members, the operation of customary practices
governing the exercise of the rights of a Holder of any Security.

 

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

 

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

 

Section 2.02.  Execution and Authentication.

 

(a)        The aggregate principal amount of
Securities which may be authenticated and delivered under this Indenture is
limited, pursuant to the Purchase Agreement, to $150,000,000 aggregate
principal amount ($172,500,000 aggregate principal amount if the Underwriters
exercise their over-allotment option in full).

 

13

 

(b)        An Officer shall sign the Securities for the Company by
manual or facsimile signature. 
Typographic and other minor 

errors or defects in any
such facsimile signature shall not affect the validity or enforceability of any
Security that has been authenticated and delivered by the Trustee.

 

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

 

(d)        A Security shall not be valid until an authorized signatory
of the Trustee by manual signature signs the certificate of authentication on
the Security.  The signature shall be
conclusive evidence that the Security has been authenticated under this Indenture.

 

(e)        The Trustee shall authenticate and make available for
delivery Securities for original issue in the aggregate principal amount of up
to $150,000,000 aggregate principal amount ($172,500,000 aggregate principal
amount if the Underwriters exercise their over-allotment option in full by executing
an over-allotment exercise notice and delivering such executed over-allotment
exercise notice to the Trustee and the Company) upon receipt of a written order
or orders of the Company signed by an Officer of the Company (a “Company
Order”).  The Company Order shall specify
the amount of Securities to be authenticated, shall provide that all such
Securities will be represented by a Global Security and the date on which each
original issue of Securities is to be authenticated.

 

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

 

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

 

Section 2.03.  Registrar, Paying Agent and
Conversion Agent.

 

(a)        The Company shall maintain one or more offices or agencies
where Securities may be presented for registration of transfer or for exchange
(each, a “Registrar”), one or more offices or agencies where Securities may be
presented for payment (each, a “Paying Agent”), one or more offices or agencies
where Securities may be presented for conversion (each, a “Conversion Agent”)
and one or more offices or agencies where notices and demands to or upon the
Company in respect of the Securities and this Indenture may be served.  The Company will at all times maintain a
Paying Agent, Conversion Agent, Registrar and an office or agency where notices
and demands to or upon the Company in respect of the Securities and this
Indenture may be served.  One of the
Registrars (the “Primary Registrar”) shall keep a register of the Securities
and of their transfer and exchange.  The
Company shall provide written notice to the Trustee of any Registrar,
Securities Agent, Conversion Agent or Paying Agent that is not also the
Trustee.

 

14

 

(b)        The Company shall enter into an appropriate agency agreement
with any Agent not a party to this Indenture, provided
that the Agent may be an Affiliate of the Trustee.  The agreement shall implement the provisions
of this Indenture that relate to such Agent. 
The Company shall notify the Trustee of the name and address of any
Agent not a party to this Indenture.  If
the Company fails to maintain a Registrar, Paying Agent, Conversion Agent, or
agent for service of notices and demands in any place required by this Indenture,
or fails to give the foregoing notice, the Trustee shall act as such.  The Company or any Affiliate of the Company
may act as Paying Agent (except for the purposes of Section 7.01 and Article 11).

 

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

 

Section 2.04.  Paying Agent to Hold Money in
Trust.  Prior to 12:00 p.m.  (noon), New York City time, on each due date
of the payment of principal of, or interest on, any Securities, the Company
shall deposit with the Paying Agent a sum sufficient to pay such principal or
interest so becoming due.  Subject to Section 9.02,
a Paying Agent shall hold in trust for the benefit of Holders of Securities or
the Trustee all money held by the Paying Agent for the payment of principal of,
or interest on, the Securities, and shall notify the Trustee of any failure by
the Company (or any other obligor on the Securities) to make any such
payment.  If the Company or an Affiliate
of the Company acts as Paying Agent, it shall, before 12:00 p.m.  (noon), New York City time, on each due date
of the principal of, or interest on, any Securities, segregate the money and
hold it as a separate trust fund.  The
Company at any time may require a Paying Agent to pay all money held by it to
the Trustee, and the Trustee may at any time during the continuance of any
Default, upon written request to a Paying Agent, require such Paying Agent to
pay forthwith to the Trustee all sums so held in trust by such Paying
Agent.  Upon doing so, the Paying Agent
(other than the Company) shall have no further liability for the money.

 

Section 2.05.  Lists of Holders of
Securities.  The Trustee shall
preserve in as current a form as is reasonably practicable the most recent list
available to it of the names and addresses of Holders of Securities.  If the Trustee is not the Primary Registrar,
the Company shall furnish to the Trustee on or before each Interest Payment
Date and at such other times as the Trustee may request in writing, a list in
such form and as of such date as the Trustee may reasonably require of the
names and addresses of Holders of Securities.

 

Section 2.06.  Transfer and Exchange.

 

(a)        Subject to compliance with any applicable additional
requirements contained in Section 2.12, when a Security is presented to a
Registrar with a request to register a transfer thereof or to exchange such
Security for an equal principal amount of Securities of other authorized
denominations, the Registrar shall register the transfer or make the exchange
as requested; provided, however, that every
Security presented or surrendered for registration of transfer or exchange
shall be duly endorsed or accompanied by an assignment form and, if

 

15

 

applicable, a transfer
certificate each in the form included in Exhibit A, and completed
in a manner satisfactory to the Registrar and duly executed by the Holder
thereof or its attorney duly authorized in writing.  To permit registration of transfers and
exchanges, upon surrender of any Security for registration of transfer or
exchange at an office or agency maintained pursuant to Section 2.03, the
Company shall execute and the Trustee shall authenticate Securities of a like
aggregate principal amount at the Registrar’s request.  Any exchange or transfer shall be without
charge, except that the Company or the Registrar may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto; provided that this sentence shall
not apply to any exchange pursuant to Section 2.10, 2.12(a), 4.05, 5.02(e) or
12.05.

 

(b)        Neither the Company, any Registrar nor the Trustee shall be
required to exchange or register a transfer of any Securities or portions
thereof in respect of which a Fundamental Change Repurchase Notice has been
delivered and not withdrawn by the Holder thereof (except, in the case of the
purchase of a Security in part, the portion thereof not to be purchased).

 

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

 

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

 

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

 

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

 

Section 2.07.  Replacement Securities.

 

(a)        If any mutilated Security is surrendered to the Company, a
Registrar or the Trustee, and the Company, a Registrar and the Trustee receive
evidence to their satisfaction of the destruction, loss or theft of any
Security, and there is delivered to the Company, the applicable Registrar and
the Trustee such security or indemnity as will be required by them to save each
of them harmless, then, in the absence of notice to the Company, such Registrar
or the Trustee that

 

16

 

such Security has been
acquired by a bona fide purchaser, the Company shall execute, and upon its
written request the Trustee shall authenticate and deliver, in exchange for any
such mutilated Security or in lieu of any such destroyed, lost or stolen
Security, a new Security of like tenor and principal amount, bearing a number
not contemporaneously outstanding.

 

(b)        If any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, or is about to be redeemed or
purchased by the Company pursuant to Article 3 or 4, or converted pursuant
to Article 5, the Company in its discretion may, instead of issuing a new
Security, pay, redeem, purchase or convert such Security, as the case may be.

 

(c)        Upon the issuance of any new Securities under this Section 2.07,
the Company may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
reasonable expenses (including the reasonable fees and expenses of the Trustee
or the Registrar) in connection therewith.

 

(d)        Every new Security issued pursuant to this Section 2.07
in lieu of any mutilated, destroyed, lost or stolen Security shall constitute
an original additional contractual obligation of the Company, whether or not
the mutilated, destroyed, lost or stolen Security shall be at any time
enforceable by anyone, and shall be entitled to all benefits of this Indenture
equally and proportionately with any and all other Securities duly issued
hereunder.

 

(e)        The provisions of this Section 2.07 are (to the extent
lawful) exclusive and shall preclude (to the extent lawful) all other rights
and remedies with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Securities.

 

Section 2.08.  Outstanding Securities.

 

(a)        Securities outstanding at any time are all Securities
authenticated by the Trustee, except for those canceled by it, those redeemed
or purchased pursuant to Article 3 or 4, those converted pursuant to Article 5,
those delivered to the Trustee for cancellation or surrendered for transfer or
exchange and those described in this Section 2.08 as not outstanding.

 

(b)        If a Paying Agent (other than the Company or an Affiliate of
the Company) holds in respect of the outstanding Securities on a Redemption
Date, a Fundamental Change Repurchase Date or the Final Maturity Date money
sufficient to pay the principal of (including premium, if any) and accrued
interest on Securities (or portions thereof) payable on that date, then on and
after such Redemption Date, Fundamental Change Repurchase Date or Final
Maturity Date, as the case may be, such Securities (or portions thereof, as the
case may be) shall cease to be outstanding and cash interest on them shall
cease to accrue.

 

(c)        Subject to the restrictions contained in Section 2.09, a
Security does not cease to be outstanding because the Company or an Affiliate
of the Company holds the Security.

 

Section 2.09.  Treasury Securities.  In determining whether the Holders
of the required principal amount of Securities have concurred in any notice,
direction, waiver or consent,

 

17

 

Securities owned by the Company or any other
obligor on the Securities or by any Affiliate of the Company or of such other
obligor shall be disregarded, except that, for purposes of determining whether
the Trustee shall be protected in relying on any such notice, direction, waiver
or consent, only Securities which a Responsible Officer of the Trustee with
responsibility for this Indenture actually knows are so owned shall be so
disregarded.  Securities so owned which
have been pledged in good faith shall not be disregarded if the pledgee
establishes to the satisfaction of the Trustee the pledgee’s right so to act
with respect to the Securities and that the pledgee is not the Company or any
other obligor on the Securities or any Affiliate of the Company or of such
other obligor.

 

Section 2.10.  Temporary Securities.  Until definitive Securities are
ready for delivery, the Company may prepare and execute, and, upon receipt of a
Company Order, the Trustee shall authenticate and deliver, temporary
Securities.  Temporary Securities shall
be substantially in the form of definitive securities but may have variations
that the Company with the consent of the Trustee considers appropriate for
temporary Securities.  Without
unreasonable delay, the Company shall prepare and the Trustee shall
authenticate and deliver definitive Securities in exchange for temporary
Securities.

 

Section 2.11.  Cancellation.  The Company at any time may
deliver Securities to the Trustee for cancellation.  The Registrar, the Paying Agent and the
Conversion Agent shall forward to the Trustee or its agent any Securities
surrendered to them for transfer, exchange, redemption, purchase, payment or
conversion.  The Trustee and no one else
shall promptly cancel, in accordance with its standard procedures, all
Securities surrendered for transfer, exchange, redemption, purchase, payment,
conversion or cancellation and shall dispose of the cancelled Securities in
accordance with its customary procedures or deliver the canceled Securities to
the Company upon its request therefor. 
All Securities which are redeemed, purchased or otherwise acquired by
the Company or any of its Subsidiaries prior to the Final Maturity Date
pursuant to Article 3 or 4 shall be delivered to the Trustee for
cancellation, and the Company may not hold or resell such Securities or issue
any new Securities to replace any such Securities or any Securities that any
Holder has converted pursuant to Article 5.

 

Section 2.12.  Additional Transfer and
Exchange Requirements.

 

(a)        A Global Security may not be transferred, in whole or in
part, to any Person other than the Depositary or a nominee or any successor
thereof, and no such transfer to any such other Person may be registered; provided that the foregoing shall not prohibit any transfer
of a Security that is issued in exchange for a Global Security but is not
itself a Global Security.  No transfer of
a Security to any Person shall be effective under this Indenture or the
Securities unless and until such Security has been registered in the name of
such Person.  Notwithstanding any other
provisions of this Indenture or the Securities, transfers of a Global Security,
in whole or in part, shall be made only in accordance with this Section 2.12.

 

18

 

(b)        The provisions of clauses (i), (ii), (iii) and
(iv) below shall apply only to Global Securities:

 

(i)            Notwithstanding
any other provisions of this Indenture or the Securities, a Global Security
shall not be exchanged in whole or in part for a Security registered in the
name of any Person other than the Depositary or one or more nominees thereof; provided that a Global Security may be exchanged for
Securities registered in the names of any person designated by the Depositary
in the event that (A) the Depositary has notified the Company that it is
unwilling or unable to continue as Depositary for such Global Security or such
Depositary has ceased to be a “clearing agency”
registered under the Exchange Act, and a successor Depositary is not appointed
by the Company within 90 days, (B) the Company has provided the Depositary
with written notice that it has decided to discontinue use of the system of
book-entry transfer through the Depositary or any successor Depositary or (C) an
Event of Default has occurred and is continuing.  Any Global Security exchanged pursuant to
clauses (A) or (B) above shall be so exchanged in whole and not in
part, and any Global Security exchanged pursuant to clause (C) above may
be exchanged in whole or from time to time in part as directed by the
Depositary.  Any Security issued in
exchange for a Global Security or any portion thereof shall be a Global
Security; provided that any such Security so
issued that is registered in the name of a Person other than the Depositary or
a nominee thereof shall not be a Global Security.

 

(ii)           Securities
issued in exchange for a Global Security or any portion thereof shall be issued
in definitive, fully-registered book entry form, without interest coupons,
shall have an aggregate principal amount equal to that of such Global Security
or portion thereof to be so exchanged, shall be registered in such names and be
in such authorized denominations as the Depositary shall designate and shall
bear any applicable legend provided for herein. 
Any Global Security to be exchanged in whole shall be surrendered by the
Depositary to the Trustee, as Registrar. 
With regard to any Global Security to be exchanged in part, either such
Global Security shall be so surrendered for exchange or, if the Trustee is
acting as custodian for the Depositary or its nominee with respect to such
Global Security, the principal amount thereof shall be reduced, by an amount
equal to the portion thereof to be so exchanged, by means of an appropriate
adjustment made on the records of the Trustee. 
Upon any such surrender or adjustment, the Trustee shall authenticate
and deliver the Security issuable on such exchange to or upon the order of the
Depositary or an authorized representative thereof; provided,
however, that any Global Security surrendered for exchange shall be
duly endorsed or accompanied by a written instrument of transfer in accordance
with the proviso to the first paragraph of Section 2.06(a).

 

(iii)          Subject
to the provisions of clause (v) below, the registered Holder may grant
proxies and otherwise authorize any Person, including Agent Members and persons
that may hold interests through Agent Members, to take any action which a
Holder is entitled to take under this Indenture or the Securities.

 

19

 

(iv)          In
the event of the occurrence of any of the events specified in clause (i) above,
the Company will promptly make available to the Trustee a reasonable supply of
Certificated Securities in definitive, fully registered form, without interest
coupons.

 

(v)           Neither
Agent Members nor any other Persons on whose behalf Agent Members may act shall
have any rights under this Indenture with respect to any Global Security
registered in the name of the Depositary or any nominee thereof, or under any
such Global Security, and the Depositary or such nominee, as the case may be,
may be treated by the Company, the Trustee and any agent of the Company or the
Trustee as the absolute owner and holder of such Global Security for all
purposes whatsoever.  Notwithstanding the
foregoing, nothing herein shall prevent the Company, the Trustee or any agent
of the Company or the Trustee from giving effect to any written certification,
proxy or other authorization furnished by the Depositary or such nominee, as
the case may be, or impair, as between the Depositary, its Agent Members and
any other person on whose behalf an Agent Member may act, the operation of
customary practices of such Persons governing the exercise of the rights of a
holder of any Security.

 

(c)        In the event that Certificated Securities are issued in
exchange for beneficial interests in Global Securities and, thereafter, the
events or conditions specified in Section 2.12(b)(i) which required
such exchange shall cease to exist, the Company shall deliver notice to the
Trustee and to the Holders stating that Holders may exchange Certificated
Securities for interests in Global Securities by complying with the procedures
set forth in this Indenture and briefly describing such procedures and the
events or circumstances requiring that such notice be given.  Thereafter, if Certificated Securities are
presented by a Holder to a Registrar with a request:

 

(i)            to
register the transfer of such Certificated Securities to a person who will take
delivery thereof in the form of a beneficial interest in a Global Security; or

 

(ii)           to
exchange such Certificated Securities for an equal principal amount of
beneficial interests in a Global Security, which beneficial interests will be
owned by the Holder transferring such Certificated Securities,

 

the Registrar shall register
the transfer or make the exchange as requested by canceling such Certificated
Securities and causing, or directing the Custodian to cause, the aggregate
principal amount of the applicable Global Security to be increased accordingly
and, if no such Global Security is then outstanding, the Company shall issue
and the Trustee, upon receipt of a Company Order, shall authenticate and
deliver a new Global Security; provided, however,
that the Certificated Securities presented or surrendered for registration of
transfer or exchange shall be duly endorsed or accompanied by a written
instrument of transfer in accordance with the proviso to the first paragraph of
Section 2.06(a).

 

Section 2.13.  CUSIP Numbers.  The Company in issuing the
Securities may use one or more “CUSIP” numbers (if then generally in use), and,
if so, the Trustee shall use “CUSIP” numbers in notices of redemption or
purchase as a convenience to Holders; provided that
any

 

20

 

such notice may state that no representation
is made as to the correctness of such numbers either as printed on the
Securities or as contained in any notice of a redemption or purchase and that
reliance may be placed only on the other identification numbers printed on the
Securities, and any such redemption or purchase shall not be affected by any
defect in or omission of such numbers. 
The Company will promptly notify the Trustee of any change in the
“CUSIP” numbers.

 

ARTICLE 3

REDEMPTION

 

Section 3.01.  Right to Redeem; Notices to
Trustee.  (a) The
Securities may be redeemed in whole or in part at the option of the Company on
or after January 15, 2012 and prior to the Final Maturity Date, if the
Last Reported Sale Price of the Common Stock has been greater than or equal to
130% of the Conversion Price then in effect for at least 20 Trading Days during
any 30 consecutive Trading Day period prior to the date on which the Company
provides notice of redemption.

 

(b)        The redemption price at which the Securities are redeemable
(the “Redemption Price”) shall be payable in cash and shall be equal to 100% of
the principal amount of Securities being redeemed, together with accrued and
unpaid interest to, but excluding, the Redemption Date; provided,
however, that if Securities are redeemed on a date that is after the
record date for an interest payment and on or prior to the corresponding
Interest Payment Date, the Company shall pay, on the corresponding Interest
Payment date, accrued and unpaid interest, if any, to the Holder as of the
close of business on the record date, and not to the Holder submitting the
Securities for redemption.

 

(c)        The Company may not redeem any Securities unless all accrued
and unpaid interest thereon has been or is simultaneously paid for all
semiannual periods or portions thereof terminating prior to the Redemption
Date.

 

(d)        Except as provided in this Section 3.01, the Securities
shall not be redeemable by the Company.

 

Section 3.02.  Selection of Securities to be
Redeemed.  If less than all
the Securities are to be redeemed, the Trustee shall select the Securities to
be redeemed pro rata or by lot or by any other method the Trustee considers
fair and appropriate (so long as such method is not prohibited by the rules of
the Nasdaq Global Select Market or any stock exchange on which the Securities
are then listed, as applicable).  The
Trustee shall make the selection within 7 days from its receipt of the notice
from the Company delivered pursuant to Section 3.03 from outstanding
Securities not previously called for redemption.

 

Securities and portions of them the Trustee
selects shall be in principal amounts of $1,000 or integral multiples of
$1,000.  Provisions of this Indenture
that apply to Securities called for redemption in whole also apply to
Securities called for redemption in part. 
The

 

21

 

Trustee shall notify the Company promptly of
the Securities or portions of Securities to be redeemed.

 

If any Security selected for partial
redemption is converted in part before termination of the conversion right with
respect to the portion of the Security so selected, the converted portion of
such Security shall be deemed (so far as may be) to be the portion selected for
redemption.  Securities which have been
converted during a selection of Securities to be redeemed may be treated by the
Trustee as outstanding for the purpose of such selection.

 

Section 3.03.  Notice of Redemption.  At least 30 days but not more than
60 days before a Redemption Date, the Company shall mail a notice of redemption
by first-class mail, postage prepaid, to the Trustee, the Paying Agent and each
Holder of Securities to be redeemed.

 

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

 

(i)            the
Redemption Date;

 

(ii)           the
Redemption Price;

 

(iii)          the
Conversion Price;

 

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

 

(v)           that Securities called for redemption may be converted at
any time before the close of business on the Business Day immediately preceding
the Redemption Date;

 

(vi)          that Holders who want to convert Securities must satisfy
the requirements set forth therein and in this Indenture;

 

(vii)         that
Securities called for redemption must be surrendered to the Paying Agent for
cancellation to collect the Redemption Price;

 

(viii)if fewer than all the outstanding
Securities are to be redeemed, the certificate numbers (if such Securities are
held other than in global form) and Principal Amounts of the particular
Securities to be redeemed;

 

(ix)           that, unless the
Company defaults in making payment of such Redemption Price, Interest will
cease to accrue on and after the Redemption Date; and

 

(x)            the CUSIP number of
the Securities.

 

At the Company’s written request delivered at
least 45 days prior to the date such notice is to be given (unless a shorter
time period shall be acceptable to the Trustee), the Trustee shall give the
notice of redemption to each Holder of Securities to be redeemed in the
Company’s name and at the Company’s expense.

 

22

 

Section 3.04.  Effect of Notice of
Redemption.  Once notice of
redemption is given, Securities called for redemption become due and payable on
the Redemption Date and at the Redemption Price stated in the notice except for
Securities that are converted in accordance with the terms of this
Indenture.  Upon surrender to the Paying
Agent, such Securities shall be paid at the Redemption Price stated in the
notice.

 

Section 3.05.  Deposit of Redemption
Price.  Prior to 10:00 a.m.,
New York City time, on a Redemption Date, the Company shall deposit with the
Paying Agent (or if the Company or a Subsidiary or an Affiliate of either of
them is the Paying Agent, shall segregate and hold in trust) money sufficient
to pay the Redemption Price of all Securities to be redeemed on that date other
than Securities or portions of Securities called for redemption which on or
prior thereto have been delivered by the Company to the Trustee for
cancellation or have been converted.  The
Paying Agent shall as promptly as practicable return to the Company any money
not required for that purpose.  If such
money is then held by the Company in trust and is not required for such purpose
it shall be discharged from such trust.

 

Section 3.06.  Securities Redeemed in
Part.  Upon surrender of a
Security that is redeemed in part, the Company shall execute and the Trustee shall
authenticate and deliver to the Holder a new Security in an authorized
denomination equal in principal amount to the unredeemed portion of the
Security surrendered.

 

Section 3.07.  No Requirement to
Register.  Unless the Company
defaults in the payment of the Redemption Price, the Company shall not be
required to issue, register the transfer of, or convert any Securities after
the close of business on the Business Day immediately preceding the Redemption
Date or register the transfer or conversion of any Securities so selected for
redemption, in whole or in part, except the unredeemed portion of any Security
being redeemed in part.

 

ARTICLE 4

PURCHASE

 

Section 4.01.  Repurchase of Securities at
Option of the Holder upon a Fundamental Change.

 

(a)        If a Fundamental Change occurs prior to the Final Maturity
Date, each Holder of a Security shall have the right, at the option of the
Holder, to require the Company to repurchase for cash all or any portion of the
Securities of such Holder equal to $1,000 principal amount (or an integral
multiple thereof) at the Fundamental Change Repurchase Price, on the date that
is not less than 30 days nor more than 45 days after the date of the
Fundamental Change Company Notice pursuant to subsection 4.01(b) (the
“Fundamental Change Repurchase Date”); provided that,
if the Fundamental Change Repurchase Date is after the Regular Record Date for
an interest payment and on or prior to the corresponding Interest Payment Date,
the Company shall pay, on the corresponding Interest Payment date, accrued and
unpaid interest, if any, to the Holder as of

 

23

 

the close of business on the
Regular Record date, and not to the Holder submitting the Securities for
repurchase.

 

(b)        At least twenty (20) days prior to the anticipated effective
date of a Fundamental Change, if practicable, but in any case as promptly as
practicable, the Company shall mail a written notice of the Fundamental Change
and of the resulting repurchase right to the Trustee, Paying Agent and to each
Holder (and to beneficial owners as required by applicable law) (the
“Fundamental Change Company Notice”). 
The Fundamental Change Company Notice shall include the form of a
Fundamental Change Repurchase Notice to be completed by the Holder and shall
state:

 

(i)            the
events causing such Fundamental Change;

 

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

 

(iii)          the
last date by which the Fundamental Change Repurchase Notice must be delivered
to elect the repurchase option pursuant to this Section 4.01;

 

(iv)          the
Fundamental Change Repurchase Date;

 

(v)           the
Fundamental Change Repurchase Price;

 

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

 

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

 

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

 

(ix)           the
procedures that the Holder must follow to exercise conversion rights under Article 5
and that Securities as to which a Fundamental Change Repurchase Notice has been
given may be converted into Common Stock pursuant to Article 5 of this
Indenture only to the extent that the Fundamental Change Repurchase Notice has
been withdrawn in accordance with the terms of this Indenture;

 

(x)            the
procedures that the Holder must follow to exercise rights under this Section 4.01;

 

(xi)           the
procedures for withdrawing a Fundamental Change Repurchase Notice;

 

(xii)          that,
unless the Company fails to pay such Fundamental Change Repurchase Price,
Securities covered by any Fundamental Change Repurchase Notice will cease to be
outstanding and interest will cease to accrue on and after the Fundamental
Change Repurchase Date; and

 

(xiii)         the
CUSIP number of the Securities.

 

24

 

At the Company’s request, the Trustee shall
give such Fundamental Change Company Notice in the Company’s name and at the
Company’s expense; provided, that, in all cases, the text of such Fundamental
Change Company Notice shall be prepared by the Company.  If any of the Securities is in the form of a
Global Security, then the Company shall modify such notice to the extent
necessary to accord with the Applicable Procedures relating to the purchase of
Global Securities.

 

(c)        A Holder may exercise its rights specified in Section 4.01(a) upon
delivery of a written notice (which shall be in substantially the form attached
as Exhibit A under the heading “Fundamental Change Repurchase
Notice” and which may be delivered by letter, overnight courier, hand delivery,
facsimile transmission or in any other written form and, in the case of Global
Securities, may be delivered electronically or by other means in accordance
with the Depositary’s Applicable Procedures) of the exercise of such rights (a
“Fundamental Change Repurchase Notice”) to the Company or any Paying Agent at
any time prior to the close of business on the Business Day next preceding the
Fundamental Change Repurchase Date, subject to extension to comply with
applicable law.

 

(i)            The
Fundamental Change Repurchase Notice shall state:  (A) the certificate number (if such
Security is held other than in global form) of the Security which the Holder
will deliver to be purchased (or, if the Security is held in global form, any
other items required to comply with the Applicable Procedures), (B) the
portion of the principal amount of the Security which the Holder will deliver
to be purchased, in integral multiples of $1,000, and (C) that such
Security shall be purchased as of the Fundamental Change Repurchase Date
pursuant to the terms and conditions specified in the Securities and in this
Indenture.

 

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

 

(iii)          The
Company shall only be obliged to purchase, pursuant to this Section 4.01,
a portion of a Security if the principal amount of such portion is $1,000 or an
integral multiple of $1,000 (provisions of this Indenture that apply to the
purchase of all of a Security also apply to the purchase of such portion of
such Security).

 

(iv)          Notwithstanding
anything herein to the contrary, any Holder delivering to a Paying Agent the
Fundamental Change Repurchase Notice contemplated by this Section 4.01(c) shall
have the right to withdraw such Fundamental Change Repurchase Notice in whole
or in a portion thereof that is a principal amount of $1,000 or in an integral
multiple thereof at any time prior to the close of business on the Business Day
prior to the Fundamental Change Repurchase Date by delivery of a written notice
of withdrawal to the Paying Agent in accordance with Section 4.02.

 

25

 

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

 

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

 

Section 4.02.  Effect of Fundamental Change
Repurchase Notice.

 

(a)        Upon receipt by any Paying Agent of a properly completed
Fundamental Change Repurchase Notice from a Holder, the Holder of the Security
in respect of which such Fundamental Change Repurchase Notice was given shall
(unless such Fundamental Change Repurchase Notice is withdrawn as specified in Section 4.02(b))
thereafter be entitled to receive the Fundamental Change Repurchase Price with
respect to such Security, subject to the occurrence of the Fundamental Change
Effective Date and an absence of an Event of Default, or a continuation thereof
(other than a Default in the payment of the Fundamental Change Repurchase
Price).  Such Fundamental Change
Repurchase Price shall be paid to such Holder promptly following the later of (i) the
Fundamental Change Repurchase Date (provided that
the conditions in Section 4.01 have been satisfied) and (ii) the time
of delivery of such Security to a Paying Agent by the Holder thereof in the
manner required by Section 4.01(c). 
Securities in respect of which a Fundamental Change Repurchase Notice
has been given by the Holder thereof may not be converted into shares of Common
Stock pursuant to Article 5 on or after the date of the delivery of such
Fundamental Change Repurchase Notice unless such Fundamental Change Repurchase
Notice has first been validly withdrawn in accordance with Section 4.02(b) with
respect to the Securities to be converted.

 

(b)        A Fundamental Change Repurchase Notice may be withdrawn by
means of a written notice (which may be delivered by mail, overnight courier,
hand delivery, facsimile transmission or in any other written form and, in the
case of Global Securities, may be delivered by other means in accordance with
the Applicable Procedures) of withdrawal delivered by the Holder to a Paying
Agent at any time prior to the close of business on the Business Day
immediately prior to the Fundamental Change Repurchase Date, specifying (i) the
principal amount of the Security or portion thereof (which must be a principal
amount of $1,000 or an integral multiple of $1,000 in excess thereof) with
respect to which such notice of withdrawal is being submitted, (ii) if
certificated Securities have been issued, the certificate number of the
Security being withdrawn in whole or in withdrawable part (or if the Securities
are not certificated, such written notice must comply with the Applicable
Procedures) and (iii) the portion of the principal amount of the Security
that will remain subject to the Fundamental Change Repurchase Notice, which
portion must be a principal amount of $1,000 or an integral multiple thereof.

 

26

 

Section 4.03.  Deposit of Fundamental Change
Repurchase Price.

 

(a)        On or before 12:00 p.m. 
(noon) New York City time on the Business Day following the applicable
Fundamental Change Repurchase Date, the Company shall deposit with the Trustee
or with a Paying Agent (or if the Company or an Affiliate of the Company is
acting as the Paying Agent, shall segregate and hold in trust as provided in Section 2.04)
an amount of money (in immediately available funds if deposited on or after
such Fundamental Change Repurchase Date), sufficient to pay the aggregate
Fundamental Change Repurchase Price of all the Securities or portions thereof
that are to be purchased as of such Fundamental Change Repurchase Date.

 

(b)        If a Paying Agent or the Trustee holds, in accordance with
the terms hereof, money sufficient to pay the Fundamental Change Repurchase
Price of any Security for which a Fundamental Change Repurchase Notice has been
tendered and not withdrawn in accordance with this Indenture then, on the
Business Day following the applicable Fundamental Change Repurchase Date, such
Security will cease to be outstanding, whether or not the Security is delivered
to the Paying Agent or the Trustee, and interest and, shall cease to accrue,
and the rights of the Holder in respect of the Security shall terminate (other
than the right to receive the Fundamental Change Repurchase Price as
aforesaid).  The Company shall publicly
announce the principal amount of Securities repurchased on or as soon as
practicable after the Fundamental Change Repurchase Date.

 

(c)        The Paying Agent will promptly return to the respective
Holders thereof any Securities with respect to which a Fundamental Change
Repurchase Notice has been withdrawn in compliance with this Indenture.

 

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

 

Section 4.04.  Repayment to the Company.  To the extent that the aggregate
amount of cash deposited by the Company pursuant to Section 4.03 exceeds
the aggregate Fundamental Change Repurchase Price of the Securities or portions
thereof that the Company is obligated to purchase, then promptly after the
Fundamental Change Repurchase Date the Trustee or a Paying Agent, as the case
may be, shall return any such excess cash to the Company.

 

Section 4.05.  Securities Purchased in
Part.  Any Security that is to
be purchased only in part shall be surrendered at the office of a Paying Agent,
and promptly after the Fundamental Change Repurchase Date, the Company shall
execute and the Trustee shall authenticate and deliver to the Holder of such
Security, without service charge, a new Security or Securities, of such
authorized denomination or denominations as may be requested by such Holder
(which must be equal to $1,000 principal amount or any integral thereof), in
aggregate principal amount equal to, and in exchange for, the portion of the
principal amount of the Security so surrendered that is not purchased.

 

27

 

Section 4.06.  Compliance with Securities
Laws upon Purchase of Securities.  In
connection with any offer to purchase of Securities under Section 4.01,
the Company shall (a) comply with Rule 13e-4 and Rule 14e-1 (or
any successor to either such Rule), and any other tender offer rules, if
applicable, under the Exchange Act, (b) file the related Schedule TO (or
any successor or similar schedule, form or report) if required under the
Exchange Act, and (c) otherwise comply with all federal and state
securities laws in connection with such offer to purchase or purchase of
Securities, all so as to permit the rights of the Holders and obligations of
the Company under Sections 4.01 through 4.04 to be exercised in the time and in
the manner specified therein.  To the extent
that compliance with any such laws, rules and regulations would result in
a conflict with any of the terms hereof, this Indenture is hereby modified to
the extent required for the Company to comply with such laws, rules and
regulations.

 

Section 4.07.  Purchase of Securities in Open
Market.  The Company may, to
the extent permitted by applicable law, at any time, repurchase Securities in
the open market, by tender at any price or by negotiated transactions.  The Company may, to the extent permitted by
applicable law, surrender any Security purchased by the Company pursuant to
this Article 4 to the Trustee for cancellation or reissue or resell any
Security.  Any securities surrendered to
the Trustee for cancellation may not be reissued or resold by the Company and
will be canceled promptly in accordance with Section 2.11.

 

ARTICLE 5

CONVERSION

 

Section 5.01.  Conversion Privilege and
Conversion Rate.

 

(a)        Subject to and upon compliance with the provisions of this Article 5,
at the option of the Holder thereof, any Security or portion thereof that is an
integral multiple of $1,000 principal amount may be converted into fully paid
and non-assessable shares (calculated as to each conversion to the nearest
1/10,000th of a share) of Common Stock prior to the close of business on the
Business Day immediately preceding the Final Maturity Date or such earlier date
set forth in this Article 5, unless redeemed or purchased by the Company
at the Holder’s option, at the Conversion Rate in effect at such time, determined
as hereinafter provided.  When a Holder
receives Common Stock upon conversion, such Holder will also receive the
associated preferred stock purchase right under the Company’s rights agreement
adopted in 2004 (as amended in 2007) related to its series A junior
participating preferred stock, unless, prior to conversion, the rights have
expired, terminated or been exchanged.

 

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

 

(c)        A Holder of Securities is not entitled to any rights of a
holder of Common Stock until such Holder has converted its Securities into
Common Stock, and only to the extent such Securities are deemed to have been
converted into Common Stock pursuant to this Article 5.

 

28

 

(d)        The Conversion Rate shall be adjusted in certain instances as
provided in Section 5.01(e) and Section 5.06.

 

(e)        If there shall have occurred an event specified in clauses (i) or
(ii) of the definition of Change of Control, the Company shall pay a “Make
Whole Premium” to the Holders of the Securities whose conversion notice is
received by the conversion agent on or subsequent to the date 10 Trading Days
before the date the Company announces as the anticipated Fundamental Change
Effective Date but before the close of business on the Business Day immediately
preceding the Fundamental Change Repurchase Date or 10 Trading Days after the
actual effective date of the Fundamental Change, if later, by increasing the
Conversion Rate for such Securities.  The
number of additional shares of Common Stock per $1,000 principal amount of
Securities constituting the Make Whole Premium shall be determined by the
Company by reference to the table below, based on the Fundamental Change
Effective Date and the Stock Price of such Fundamental Change; provided that if the Stock Price or Fundamental Change
Effective Date are not set forth on the table: (i) if the actual Stock
Price on the Fundamental Change Effective Date is between two Stock Prices on
the table or the actual Fundamental Change Effective Date is between two
Fundamental Change Effective Dates on the table, the Make Whole Premium will be
determined by a straight-line interpolation between the Make Whole Premiums set
forth for the two Stock Prices and the two Fundamental Change Effective Dates
on the table based on a 365-day year, as applicable, (ii) if the Stock
Price on the Fundamental Change Effective Date exceeds $100.00 per share,
subject to adjustment as set forth herein, no Make Whole Premium will be paid,
and (iii) if the Stock Price on the Fundamental Change Effective Date is
less than $19.90 per share, subject to adjustment as set forth herein, no Make
Whole Premium will be paid.  If Holders
of the Common Stock receive only cash in the Fundamental Change, the Stock
Price shall be the cash amount paid per share of the Common Stock in connection
with the Fundamental Change.  Otherwise,
the Stock Price shall be equal to the average Closing Prices of the Common
Stock for each of the 10 Trading Days immediately preceding, but not including,
the applicable Fundamental Change Effective Date.

 

	
  Stock Price on

  	
   

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

  	
   

  
	
  Effective Date

  	
   

  	
  1/23/2008

  	
   

  	
  1/15/2009

  	
   

  	
  1/15/2010

  	
   

  	
  1/15/2011

  	
   

  	
  1/15/2012

  	
   

  	
  1/15/2013

  	
   

  	
  1/15/2014

  	
   

  	
  1/15/2015

  	
   

  
	
  $

  	
  19.90

  	
   

  	
  11.5964

  	
   

  	
  11.5964

  	
   

  	
  11.5964

  	
   

  	
  11.5964

  	
   

  	
  11.5964

  	
   

  	
  11.5964

  	
   

  	
  11.5964

  	
   

  	
  11.5964

  	
   

  
	
  25.00

  	
   

  	
  7.6294

  	
   

  	
  7.1506

  	
   

  	
  6.5456

  	
   

  	
  5.8079

  	
   

  	
  5.2590

  	
   

  	
  5.1751

  	
   

  	
  4.5360

  	
   

  	
  1.3452

  	
   

  
	
  30.00

  	
   

  	
  5.4831

  	
   

  	
  4.9012

  	
   

  	
  4.1577

  	
   

  	
  3.1605

  	
   

  	
  1.8060

  	
   

  	
  1.7214

  	
   

  	
  1.3964

  	
   

  	
  0.0000

  	
   

  
	
  35.00

  	
   

  	
  4.1332

  	
   

  	
  3.5452

  	
   

  	
  2.7948

  	
   

  	
  1.7803

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  
	
  40.00

  	
   

  	
  3.3024

  	
   

  	
  2.7457

  	
   

  	
  2.0487

  	
   

  	
  1.1397

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  
	
  50.00

  	
   

  	
  2.3355

  	
   

  	
  1.8693

  	
   

  	
  1.3105

  	
   

  	
  0.6472

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  
	
  60.00

  	
   

  	
  1.8105

  	
   

  	
  1.4264

  	
   

  	
  0.9827

  	
   

  	
  0.4870

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  
	
  80.00

  	
   

  	
  1.2767

  	
   

  	
  1.0043

  	
   

  	
  0.6966

  	
   

  	
  0.3564

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  
	
  100.00

  	
   

  	
  0.9989

  	
   

  	
  0.7908

  	
   

  	
  0.5532

  	
   

  	
  0.2856

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  	
  0.0000

  	
   

  
																			

 

The Stock Prices set forth in the first
column of the table above will be adjusted as of any date on which the
Conversion Rate of the Securities is adjusted. 
The adjusted Stock Prices will equal the Stock Prices applicable
immediately prior to such adjustment multiplied by a fraction, the numerator of
which is the Conversion Rate immediately prior to the adjustment giving rise to

 

29

 

the Stock Price adjustment and the
denominator of which is the Conversion Rate as so adjusted.  The number of additional shares set forth in
the table above will be adjusted in the same manner as the Conversion Rate as
set forth in Section 5.06 hereof, other than as a result of an adjustment
of the Conversion Rate by adding the Make Whole Premium as described above.

 

Notwithstanding the foregoing paragraph, in
no event will the total number of shares of Common Stock issuable upon
conversion of a Security exceed 50.2512 per $1,000 principal amount, subject to
adjustment in the same manner as the Conversion Rate as set forth in clauses (i) through
(vii) of Section 5.06(a) hereof.

 

The additional shares issuable pursuant to
this Section 5.01(e) shall be delivered upon the later of (i) the
settlement date for the conversion and (ii) promptly following the
Fundamental Change Effective Date.

 

(f)         By delivering the number of shares of Common Stock issuable
on conversion to the Trustee, or to the Conversion Agent, if the Conversion
Agent is other than the Trustee, the Company will be deemed to have satisfied
its obligation to pay the principal amount of the Securities so converted and
its obligation to pay accrued and unpaid interest attributable to the period
from the most recent Interest Payment Date through the Conversion Date (which
amount will be deemed paid in full rather than cancelled, extinguished or
forfeited).

 

(g)        The Trustee may conclusively rely on the Company’s
calculations of the Make Whole Premium.

 

Section 5.02.  Conversion Procedure.

 

(a)        To convert a Security, a Holder must (i) complete and
manually sign the conversion notice on the back of the Security and deliver
such notice to a Conversion Agent, (ii) surrender the Security to a
Conversion Agent, (iii) furnish appropriate endorsements and transfer
documents if required by a Registrar or a Conversion Agent, and (iv) pay
all transfer or similar taxes, if required pursuant to Section 5.04.  The date on which the Holder satisfies all of
those requirements is the “Conversion Date.” Upon the conversion of a Security,
the Company will deliver the shares of Common Stock (and cash in lieu of
fractional shares), to the Trustee (or to the Conversion Agent, if the
Conversion Agent is other than the Trustee), as applicable, no later than three
(3) Business Days after the Conversion Date.  Anything herein to the contrary
notwithstanding, in the case of Global Securities, conversion notices may be
delivered and such Securities may be surrendered for conversion in accordance
with the Applicable Procedures as in effect from time to time.

 

(b)        The person in whose name the shares of Common Stock are
issuable upon conversion shall be deemed to be a holder of record of such
Common Stock on the Conversion Date; provided, however,
that no surrender of a Security on any Conversion Date when the stock transfer
books of the Company shall be closed shall be effective to constitute the
person or persons entitled to receive the shares of Common Stock upon
conversion as the record holder or holders of such shares of Common Stock on
such date, but such surrender shall be effective to

 

30

 

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

 

(c)        If a holder surrenders a Security for conversion during the
period from the close of business on any Regular Record Date next preceding any
Interest Payment Date to the opening of business on such Interest Payment Date,
then, despite the conversion, the Company shall, on the Interest Payment Date,
pay the semiannual interest payable on such Security to the Person who was the
Holder at the close of business on the Regular Record Date.  Such Security, upon surrender to the Company
for conversion, must be accompanied by funds equal to the amount of interest
payable on the Security so converted, provided that
no such payment need be made (i) in connection with any conversion
following the Regular Record Date immediately preceding the final Interest
Payment Date, (ii) if the Company had specified a Fundamental Change
Purchase Date that is after a Regular Record Date and on or prior to the
Business Day following the corresponding Interest Payment Date, (iii) in
connection with any conversion of Securities that have been called by the
Company for redemption and in respect of which the Company had specified a
Redemption Date that is after a Regular Record Date but on or prior to the
corresponding Interest Payment Date, or (iv) to the extent of any overdue
interest, if any overdue interest exists at the time of conversion with respect
to such Security.

 

(d)        Subject to Section 5.02(c), nothing in this Section shall
affect the right of a Holder in whose name any Security is registered at the
close of business on a Regular Record Date to receive the interest payable on
such Security on the related Interest Payment Date in accordance with the terms
of this Indenture and the Securities.  If
a Holder converts more than one Security at the same time, the number of shares
of Common Stock issuable upon the conversion, if any, (and the amount of any
cash in lieu of fractional shares pursuant to Section 5.03) shall be based
on the aggregate principal amount of all Securities so converted.

 

(e)        In the case of any Security which is converted in part only,
upon such conversion the Company shall execute and the Trustee shall
authenticate and deliver to the Holder thereof, without service charge, a new
Security or Securities of authorized denominations in an aggregate principal
amount equal to, and in exchange for, the unconverted portion of the principal
amount of such Security.  A Security may
be converted in part, but only if the principal amount of such part is an
integral multiple of $1,000 and the principal amount of such Security to remain
outstanding after such conversion is equal to $1,000 or any integral multiple
of $1,000 in excess thereof.

 

Section 5.03.  Fractional Shares.  The Company will not issue
fractional shares of Common Stock upon conversion of Securities.  If more than one Security shall be
surrendered for conversion at one time by the same Holder, the number of full
shares that shall be issuable

 

31

 

upon conversion shall be computed on the
basis of the aggregate principal amount of the Securities (or specified
portions thereof to the extent permitted hereby) so surrendered.  In lieu of any fractional share, the Company
will pay an amount in cash for the current market value of the fractional
share.  The current market value of a
fractional share shall be determined (calculated to the nearest 1/100th of a
share) by multiplying the average of the Closing Price of the Common Stock on
the Trading Day immediately preceding the Conversion Date by such fractional
share and rounding the product to the nearest whole cent.

 

Section 5.04.  Taxes on Conversion.  If a Holder converts a Security,
the Holder shall pay any transfer, stamp or similar taxes or duties related to
the issue or delivery of shares of Common Stock upon such conversion.  The Holder shall also pay any such tax with
respect to cash received in lieu of fractional shares.  In addition, 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 certificate 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
shares are to be issued in a name other than the Holder’s name.  Nothing herein shall preclude any tax
withholding required by law or regulation.

 

Section 5.05.  Company to Provide Stock.

 

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

 

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

 

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

 

Section 5.06.  Adjustment of Conversion Rate.

 

(a)        The Conversion Rate shall be adjusted
from time to time by the Company as follows:

 

(i)            If
the Company shall pay a dividend or make a distribution on outstanding Common
Stock in shares of Common Stock, the Conversion Rate in effect immediately
prior to the record date for the determination of shareholders entitled to
receive such dividend or other distribution shall be increased so that the same
shall equal the rate determined by the Company by multiplying the Conversion
Rate in effect immediately

 

32

 

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

 

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

 

(iii)          If
the Company shall issue certain rights or warrants to all or substantially all
holders of its outstanding Common Stock entitling them (for a period expiring
within 45 days after such issuance) to subscribe for or purchase shares of
Common Stock (or securities convertible into Common Stock) at a price per share
(or having a conversion price per share) less than the Current Market Price per
share of Common Stock (as determined in accordance with clause (ix) of
this Section 5.06(a)) on the record date for the determination of
shareholders entitled to receive such rights or warrants, the Conversion Rate
in effect immediately prior thereto shall be adjusted so that the same shall
equal the rate determined by multiplying the Conversion Rate in effect
immediately prior to such record date by a fraction of which the numerator
shall be the number of shares of Common Stock outstanding at the close of
business on such record date plus the number of additional shares of Common
Stock that such rights or warrants entitle holders thereof to subscribe for or
purchase (or into which such convertible securities are convertible) and of
which the denominator shall be the number of shares of Common Stock outstanding
at the close of business on such record date plus the number of shares which
the aggregate offering price of the total number of shares of Common Stock so
offered for subscription or purchase (or the aggregate conversion price of the
convertible securities so offered for subscription or purchase, which shall be
determined by multiplying the number of shares of Common Stock issuable upon
conversion of such convertible securities by the conversion price per share of
Common Stock pursuant to the terms of such convertible securities) would
purchase at the Current Market Price per

 

33

 

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

 

(iv)          If
the Company shall make a dividend or other distribution to all or substantially
all holders of its Common Stock of Capital Stock, other than Common Stock, or
evidences of indebtedness or other assets of the Company, including securities
(excluding (x) any issuance of rights or warrants for which an adjustment
was made pursuant to Section 5.06(a)(iii), (y) dividends or
distributions in connection with a reclassification, consolidation, merger,
combination, sale or conveyance resulting in a change in the conversion consideration
pursuant to Section 5.10, or pursuant to any Rights Plan or (z) any
dividend or distribution paid exclusively in cash for which an adjustment was
made pursuant to Section 5.06(a)(vi)) (the “Distributed Securities”), then
in each such case (unless the Company distributes such Distributed Securities
for distribution to the Holders of Securities on such dividend or distribution
date as if each Holder had converted such Security into Common Stock
immediately prior to the record date with respect to such distribution) the
Conversion Rate in effect immediately prior to the record date fixed for the
determination of shareholders entitled to receive such dividend or distribution
shall be adjusted so that the same shall equal the rate determined by multiplying
the Conversion Rate in effect immediately prior to such record date by a
fraction of which the numerator shall be the Current Market Price per share of
the Common Stock on such record date and of which the denominator shall be
Current Market Price per share on such record date less the fair market value
(as determined in good faith by the Board of Directors, whose determination
shall be conclusive evidence of such fair market value and which shall be
evidenced by an Officers’ Certificate delivered to the Trustee) on such record
date of the portion of the Distributed Securities so distributed applicable to
one share of Common Stock (determined on the basis of the number of shares of
Common Stock outstanding at the close of business on such record date).  Such adjustment shall be made successively
whenever any such distribution is 

 

34

 

made and shall become effective immediately after the record date for
the determination of shareholders entitled to receive such distribution.  In the event that such dividend or
distribution is not so paid or made, the Conversion Rate shall again be
adjusted to be the Conversion Rate that would then be in effect if such
dividend or distribution had not been declared.

 

If the fair market value (as so determined)
of the portion of the Distributed Securities so distributed applicable to one
share of Common Stock is equal to or greater than the Current Market Price per
share of the Common Stock on such record date, in lieu of the foregoing
adjustment, adequate provision shall be made so that each holder of a Security
shall have the right to receive upon conversion the amount of Distributed
Securities so distributed that such Holder would have received had such Holder
converted each Security on such record date. 
If the Board of Directors determines the fair market value of any
distribution for purposes of this Section 5.06(a)(iv) by reference to
the actual or when issued trading market for any securities, it must in doing
so consider the prices in such market over the same period used in computing
the Current Market Price of the Common Stock.

 

Notwithstanding the foregoing, if the
securities distributed by the Company to all holders of its Common Stock
consist of Capital Stock of, or similar equity interests in, a Subsidiary or
other business unit of the Company (the “Spinoff Securities”), the Conversion
Rate shall be adjusted, unless the Company makes an equivalent distribution to
the Holders of the Securities, so that the same shall be equal to the rate
determined by multiplying the Conversion Rate in effect on the record date
fixed for the determination of shareholders entitled to receive such
distribution by a fraction, the numerator of which shall be the sum of (A) the
average Closing Price of one share of Common Stock over the ten consecutive
Trading Day period (the “Spinoff Valuation Period”) commencing on and including
the Trading Day on which ex-dividend trading commences for such distribution on
the Nasdaq Global Market or such other U.S. 
national or regional exchange or market on which the Common Stock is
then listed or quoted and (B) the average of the Closing Prices over the
Spinoff Valuation Period of the Spinoff Securities multiplied by the number of
Spinoff Securities distributed in respect of one share of Common Stock and the
denominator of which shall be the average Closing Price of one share of Common
Stock over the Spinoff Valuation Period, such adjustment to become effective
immediately prior to the opening of business on the tenth Trading Day after the
date on which ex-dividend trading commences; provided,
however, that the Company may in lieu of the foregoing adjustment
elect to make adequate provision so that each Holder of Securities shall have
the right to receive upon conversion thereof the amount of such Spinoff
Securities that such Holder of Securities would have received if such
Securities had been converted on the record date with respect to such
distribution.

 

(v)           With
respect to any rights or warrants (the “Rights”) that may be issued or
distributed pursuant to any rights plan of the Company currently in effect or
that the Company implements after the date of this Indenture (a “Rights Plan”),
or if the 

 

35

 

Company’s current Rights Plan is still in
effect, in lieu of any adjustment required by any other provision of this Section 5.06
upon conversion of the Securities into Common Stock, to the extent that such
Rights Plan is in effect upon such conversion, the Holders of Securities will
receive, with respect to the shares of Common Stock issued upon conversion, the
Rights described therein (whether or not the Rights have separated from the
Common Stock at the time of conversion), subject to the limitations set forth
in and in accordance with any such Rights Plan; provided
that in the case of the Company’s current Rights Plan or a future Rights Plan
to the extent applicable, if, at the time of conversion, the Rights have
separated from the shares of Common Stock in accordance with the provisions of
the Rights Plan so that Holders would not be entitled to receive any rights in
respect of the shares of Common Stock issuable upon conversion of the
Securities as a result of the timing of the Conversion Date, the Conversion
Rate will be adjusted as if the Company distributed to all holders of Common
Stock Distributed Securities constituting such rights as provided in the first
paragraph of clause (iv) of this Section 5.06(a), subject to
appropriate readjustment in the event of the expiration, termination,
repurchase or redemption of the Rights. 
Any distribution of rights or warrants pursuant to a Rights Plan
complying with the requirements set forth in the immediately preceding sentence
of this paragraph shall not constitute a distribution of rights or warrants
pursuant to this Section 5.06(a). 
Other than as specified in this clause (v) of this Section 5.06(a),
there will not be any adjustment to the Conversion Rate as the result of the
issuance of any Rights, the distribution of separate certificates representing
such Rights, the exercise or redemption of such Rights in accordance with any
Rights Plan or the termination or invalidation of any Rights.

 

(vi)          If
the Company shall, by dividend or otherwise, at any time distribute (a
“Triggering Distribution”) to all holders of its Common Stock a payment
consisting exclusively of cash (excluding any dividend or distribution in
connection with the liquidation, dissolution or winding up of the Company,
whether voluntary or involuntary) the Conversion Rate shall be increased so
that the same shall equal the rate determined by multiplying such Conversion
Rate in effect at the opening of business on the date on which ex-dividend
trading commences for such Triggering Distribution (a “Determination Date”) by
a fraction of which the numerator shall be the average of the Last Reported
Sale Price for the ten Trading Days prior to the date on which ex-dividend
trading commences for such dividend or distribution and the denominator of
which shall be the difference between (A) such average price of the Common
Stock and (B) the amount in cash per share of such dividend or
distribution, such increase to become effective immediately prior to the
opening of business on the day following the Determination Date.  If the amount of cash dividend or
distribution applicable to one share of Common Stock is equal to or greater
than the Last Reported Sale Price per share of the Common Stock on the
Determination Date, in lieu of the foregoing adjustment, adequate provision
shall be made so that each Holder of a Security shall have the right to receive
upon conversion the amount of cash so distributed that such Holder would have
received had such Holder converted each Security on such Determination Date.  In the event that such dividend or
distribution is not so paid or made, the Conversion Rate shall 

 

36

 

again be adjusted to be the Conversion Rate that would then be in
effect if such divided or distribution had not been declared.

 

(vii)         If
any tender offer made by the Company or any of its Subsidiaries for all or any
portion of Common Stock shall expire, then, if the tender offer shall require
the payment to shareholders of consideration per share of Common Stock having a
fair market value (determined as provided below) that exceeds Closing Price per
share of Common Stock on the Trading Day next succeeding the last date (the
“Expiration Date”) tenders could have been made pursuant to such tender offer
(as it may be amended) (the last time at which such tenders could have been
made on the Expiration Date is hereinafter sometimes called the “Expiration
Time”), the Conversion Rate shall be increased so that the same shall equal the
rate determined by multiplying the Conversion Rate in effect immediately prior
to the close of business on the Expiration Date by a fraction of which the
numerator shall be the sum of (A) the fair market value of the aggregate
consideration (the fair market value as determined in good faith by the Board
of Directors, whose determination shall be conclusive evidence of such fair
market value and which shall be evidenced by an Officer’s Certificate delivered
to the Trustee) payable to shareholders based on the acceptance (up to any
maximum specified in the terms of the tender offer) of all shares validly
tendered and not withdrawn as of the Expiration Time (the shares deemed so
accepted, up to any such maximum, being referred to as the “Purchased Shares”)
and (B) the product of the number of shares of Common Stock outstanding
(less any Purchased Shares and excluding any shares held in the treasury of the
Company) at the Expiration Time and the Closing Price per share of Common Stock
on the Trading Day next succeeding the Expiration Date and the denominator of
which shall be the product of the number of shares of Common Stock outstanding
(including Purchased Shares but excluding any shares held in the treasury of
the Company) at the Expiration Time multiplied by the Closing Price per share
of the Common Stock on the Trading Day next succeeding the Expiration Date,
such increase to become effective immediately prior to the opening of business
on the day following the Expiration Date. 
In the event that the Company is obligated to purchase shares pursuant
to any such tender offer, but the Company is permanently prevented by
applicable law from effecting any or all such purchases or any or all such
purchases are rescinded, the Conversion Rate shall again be adjusted to be the
Conversion Rate which would have been in effect based upon the number of shares
actually purchased, if any.  If the
application of this clause (vii) of Section 5.06(a) to any
tender offer would result in a decrease in the Conversion Rate, no adjustment
shall be made for such tender offer under this clause (vii).

 

(viii)        For
purposes of this Section 5.06, the term “tender offer” shall mean and
include both tender offers and exchange offers, all references to “purchases”
of shares in tender offers (and all similar references) shall mean and include
both the purchase of shares in tender offers and the acquisition of shares
pursuant to exchange offers, and all references to “tendered shares” (and all
similar references) shall mean and include shares tendered in both tender offers
and exchange offers.

 

37

 

(ix)           For
purposes of any computation under this Section 5.06, “Current Market
Price” shall mean the average of the daily Closing Prices per share of Common
Stock for each of the ten consecutive Trading Days immediately prior to the
date in question; provided, however, that if:

 

(A)            the
“ex” date (as hereinafter defined) for any event (other than the issuance or
distribution requiring such computation) that requires an adjustment to the
Conversion Rate pursuant to Section 5.06(a) (i), (ii), (iii), (iv),
(v), (vi) or (vii) occurs during such ten consecutive Trading Days,
the Closing Price for each Trading Day prior to the “ex” date for such other
event shall be adjusted by dividing such Closing Price by the same fraction by
which the Conversion Rate is so required to be adjusted as a result of such
other event;

 

(B)            the
“ex” date for any event (other than the issuance or distribution requiring such
computation) that requires an adjustment to the Conversion Rate pursuant to Section 5.06(a) (i),
(ii), (iii), (iv), (v), (vi) or (vii) occurs on or after the “ex”
date for the issuance or distribution requiring such computation and prior to
the day in question, the Closing Price for each Trading Day on and after the
“ex” date for such other event shall be adjusted by dividing such Closing Price
by the reciprocal of the fraction by which the Conversion Rate is so required
to be adjusted as a result of such other event; and

 

(C)            the
“ex” date for the issuance or distribution requiring such computation is prior
to the day in question, after taking into account any adjustment required
pursuant to the immediately preceding clause (A) or (B) of this Section 5.06(a)(ix),
the Closing Price for each Trading Day on or after such “ex” date shall be
adjusted by adding thereto the amount of any cash and the fair market value (as
determined in good faith by the Board of Directors in a manner consistent with
any determination of such value for purposes of Section 5.06(a)(iv) or
(vii), whose determination shall be conclusive and set forth in a Board
Resolution) of the evidences of indebtedness, shares of capital stock or assets
being distributed applicable to one share of Common Stock as of the close of business
on the day before such “ex” date.

 

For purposes of any computation under Section 5.06(a),
if the “ex” date for any event (other than the tender offer that is the subject
of the adjustment pursuant to Section 5.06(a)(vii)) that requires an
adjustment to the Conversion Rate pursuant to Section 5.06(a)(i), (ii),
(iii), (iv), (v) or (vi) occurs on the date of the Expiration Time
for the tender or exchange offer requiring such computation or on the Trading
Day next following the Expiration Time, the Closing Price for each Trading Day
on and after the “ex” date for such other event shall be adjusted by dividing
such Closing Price by the reciprocal of the fraction by which the Conversion
Rate is so required to be adjusted as a result of such other event.  For purposes of this Section 5.06(a)(ix) the
term “ex” date, when used:

 

38

 

(A)                  with respect to any issuance
or distribution, means the first date on which the Common Stock trades regular
way on the relevant exchange or in the relevant market from which the Closing
Price was obtained without the right to receive such issuance or distribution;

 

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

 

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

 

Notwithstanding the foregoing, whenever
successive adjustments to the Conversion Rate are called for pursuant to this Section 5.06,
such adjustments shall be made to the Current Market Price as may be necessary
or appropriate to effectuate the intent of this Section 5.06 and to avoid
unjust or inequitable results as determined in good faith by the Board of
Directors and evidenced by an Officers’ Certificate delivered to the Trustee.

 

(b)        In any case in which this Section 5.06 shall require
that an adjustment be made following a record date, a Determination Date or
Expiration Date, as the case may be, established for the purposes specified in
this Section 5.06, the Company may elect to defer (but only until three
Business Days following the filing by the Company with the Trustee of the
certificate described in Section 5.08) issuing to the Holder of any
Security converted after such record date, Determination Date or Expiration Date
the shares of Common Stock and other Capital Stock of the Company issuable upon
such conversion over and above the shares of Common Stock and other Capital
Stock of the Company (or other cash, property or securities, as applicable)
issuable upon such conversion only on the basis of the Conversion Rate prior to
adjustment; and, in lieu of any cash, property or securities the issuance of
which is so deferred, the Company shall issue or cause its transfer agents to
issue due bills or other appropriate evidence prepared by the Company of the
right to receive such cash, property or securities.  If any distribution in respect of which an
adjustment to the Conversion Rate is required to be made as of the record date,
Determination Date or Expiration Date therefore is not thereafter made or paid
by the Company for any reason, the Conversion Rate shall be readjusted to the
Conversion Rate which would then be in effect if such record date had not been
fixed or such record date, Determination Date or Expiration Date had not
occurred.

 

(c)        For purposes of this Section 5.06, “record date” shall
mean, with respect to any dividend, distribution or other transaction or event
in which the holders of Common Stock have the right to receive any cash,
securities or other property or in which the Common Stock (or other applicable
security) is exchanged or converted into any combination of cash, securities or
other property, the date fixed for determination of shareholders entitled to
receive such cash, security or other property (whether or not such date is
fixed by the Board of Directors or by statute, contract or otherwise).

 

39

 

(d)        If one or more events occur requiring an adjustment be made
to the Conversion Rate for a particular period, adjustments to the Conversion
Rate shall be determined by the Company’s Board of Directors to reflect the
combined impact of such Conversion Rate adjustment events, as set out in this Section 5.06,
during such period.

 

(e)        Notwithstanding the provisions set forth in Section 5.06(a),
in no event shall the total number of shares of Common Stock issuable upon
conversion of a Security exceed 50.2512 shares per $1,000 principal amount of
Securities, subject to adjustments in the same manner as the Conversion Rate as
set forth in clauses (i) through (vii) of Section 5.06(a).

 

Section 5.07.  No Adjustment.

 

(a)        No adjustment in the Conversion Rate shall be required if
Holders may, by virtue of their ownership of the Securities, participate in the
transactions set forth in Section 5.06 above (to the same extent as if the
Securities had been converted into Common Stock immediately prior to such
transactions) without converting the Securities held by such Holders.

 

(b)        No adjustment in the Conversion Rate shall be required unless
such adjustment would require an increase or decrease of at least 1% in the
Conversion Rate as last adjusted; provided, however,
that any adjustments which would be required to be made but for this Section 5.07(b) shall
be carried forward and taken into account in any subsequent adjustment.  The Company shall adjust for any carry
forward amount upon conversion regardless of the 1% threshold.  All calculations under this Article 5
shall be made to the nearest cent or to the nearest one-ten thousandth of a
share, as the case may be, with one half cent and 0.00005 of a share,
respectively, being rounded upward.

 

(c)        No adjustment in the Conversion Rate shall be required for
issuances of Common Stock pursuant to a Company plan for reinvestment of
dividends, the issuance of Common Stock or options to purchase shares of Common
Stock pursuant to any present or future employee, director or consultant
benefit plan or program of or assumed by the Company, upon the issuance of
Common Stock pursuant to any option, warrant or right, or exercise of any
exchangeable or convertible security outstanding as of the Issue Date,
repurchases by the Company of Common Stock not expressly discussed in this Article 5
or interest or for a change to a par value of the Common Stock.

 

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

 

Section 5.08.  Notice of Adjustment.  Whenever the Conversion Rate or
conversion privilege is required to be adjusted pursuant to this Indenture, the
Company shall promptly mail to Holders a notice of the adjustment and file with
the Trustee an Officers’ Certificate briefly stating the facts requiring the
adjustment and the manner of computing it. 
Failure to mail such notice or any defect therein shall not affect the
validity of any such adjustment.  Unless
and until the Trustee shall receive an Officers’ Certificate setting forth an
adjustment of the Conversion 

 

40

 

Rate, the Trustee may assume without inquiry
that the Conversion Rate has not been adjusted and that the last Conversion
Rate of which it has knowledge remains in effect.

 

Section 5.09.  Notice of Certain
Transactions.  In the event
that there is a dissolution or liquidation of the Company, the Company shall
mail to Holders and file with the Trustee a notice stating the proposed
effective date.  The Company shall mail
such notice at least 10 days before such proposed effective date.  Failure to mail such notice or any defect
therein shall not affect the validity of any transaction referred to in this Section 5.09.

 

Section 5.10.  Effect of Recapitalization,
Reclassification, Consolidation, Merger or Sale.  If any of following events occur
(each, a “Business Combination”):

 

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

 

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

 

(iii)  a
sale, conveyance or lease to another corporation of all or substantially all of
the property and assets of the Company, other than to one or more of the
Company’s subsidiaries, or

 

(iv)  any
statutory share exchange,

 

in each case as a result of which holders of
Common Stock are entitled to receive stock, other securities, other property or
assets (including cash or any combination thereof) with respect to or in
exchange for Common Stock, the Company or the successor or purchasing
corporation, as the case may be, shall execute with the Trustee a supplemental
indenture (which shall comply with the TIA as in force at the date of execution
of such supplemental indenture if such supplemental indenture is then required
to so comply) providing that the Holders of the Securities then outstanding
will be entitled thereafter to convert such Securities into the kind and amount
of shares of stock, other securities or other property or assets (including
cash or any combination thereof) which they would have owned or been entitled
to receive upon such Business Combination had such Securities been converted
into Common Stock immediately prior to such Business Combination, except that
such Holders will not receive the Make Whole Premium if such Holder does not
convert its Securities “in connection with” the relevant Fundamental
Change.  A conversion of the Securities
by a Holder will be deemed for these purposes to be “in connection with” a
Fundamental Change if the notice of such conversion is provided in compliance
with Section 5.02(a) to the Conversion Agent on or subsequent to the
date 10 Trading Days prior to the date announced by the Company as the
anticipated Fundamental Change Effective Date but before the close of business
on the Business Day immediately preceding the related Fundamental Change
Repurchase Date.  In the event holders of
Common Stock have the opportunity to elect the form of consideration to be
received in such Business Combination, the Securities will be convertible into
the weighted average of the kind and amount of consideration received by the
holders of the Common Stock that affirmatively make such an election.  The Company may not become a party to any
such transaction unless its terms are 

 

41

 

consistent with this Section 5.10.  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.  If, in the case of any such Business
Combination, the stock or other securities and assets receivable thereupon by a
holder of shares of Common Stock includes shares of stock or other securities
and assets of a corporation other than the successor or purchasing corporation,
as the case may be, in such Business Combination, then such supplemental
indenture shall also be executed by such other corporation and shall contain
such additional provisions to protect the interests of the Holders of the
Securities as the Board of Directors shall reasonably consider necessary by
reason of the foregoing, including to the extent practicable the provisions
providing for the Repurchase Rights set forth in Article 4 hereof.  Notwithstanding anything contained in this
Section, and for the avoidance of doubt, this Section shall not affect the
right of a Holder to convert its Securities into shares of Common Stock prior
to the effective date of the Business Combination.

 

Section 5.11.  Trustee’s Disclaimer.

 

(a)        The Trustee shall have no duty to determine when an
adjustment under this Article 5 should be made, how it should be made or
what such adjustment should be, but may accept as conclusive evidence of that
fact or the correctness of any such adjustment, and shall be protected in
relying upon, an Officers Certificate and/or an Opinion of Counsel, including
the Officers’ Certificate with respect thereto which the Company is obligated
to file with the Trustee pursuant to Section 5.08.  The Trustee makes no representation as to the
validity or value of any securities or assets issued upon conversion of
Securities, and the Trustee shall not be responsible for the Company’s failure
to comply with any provisions of this Article 5.

 

(b)        The Trustee shall not be under any responsibility to
determine the correctness of any provisions contained in any supplemental
indenture executed pursuant to Section 5.10, but may accept as conclusive
evidence of the correctness thereof, and shall be fully protected in relying
upon, the officers, Certificate and Opinion of Counsel, with respect thereto which
the Company is obligated to file with the Trustee pursuant to Section 13.04.

 

Section 5.12.  Voluntary Increase.  The Company from time to time may
increase the Conversion Rate, to the extent permitted by law, by any amount for
any period of time if the period is at least 20 days, and the Company provides
15 days prior written notice to any increase in the Conversion Rate to the
Trustee and Holders.  The Company may
also make such an increase to the Conversion Rate as the Board of Directors
deems advisable to avoid or diminish U.S. 
federal income tax to holders of shares of Common Stock in connection
with a dividend or distribution of stock (or rights to acquire stock) or from
any event treated as such for U.S. 
federal income tax purposes.

 

Notwithstanding the foregoing paragraph, in
no event will the total number of shares of Common Stock issuable upon
conversion of a Security exceed 50.2512 shares per $1,000 principal amount,
subject to adjustment in the same manner as the Conversion Rate as set forth in
clauses (i) through (vii) of Section 5.06(a) hereof.

 

42

 

ARTICLE 6

SUBORDINATION

 

Section 6.01.  Agreement of
Subordination.  The Company
covenants and agrees, and each Holder of Securities issued hereunder by its
acceptance thereof likewise covenants and agrees, that all Securities shall be
issued subject to the provisions of this Article 6; and each Person
holding any Security, whether upon original issue or upon transfer, assignment
or exchange thereof, accepts and agrees to be bound by such provisions.

 

The payment of the principal of, premium, if
any, and interest on, all Securities (including, but not limited to, the
Fundamental Change Repurchase Price with respect to the Securities subject to purchase
in accordance with Article 4 as provided in this Indenture) issued
hereunder shall, to the extent and in the manner hereinafter set forth, be
subordinated and subject in right of payment to the prior payment in full in
cash, or other payment satisfactory to the holders of Senior Indebtedness, of
all Senior Indebtedness, whether outstanding at the date of this Indenture or
thereafter incurred.

 

No provision of this Article 6 shall
prevent the occurrence of any default or Event of Default hereunder.

 

Section 6.02.  Payments to Holders.  The Company shall not make any
payment with respect to the principal of, or premium, if any, or interest on
the Securities (including, but not limited to, the Fundamental Change
Repurchase Price with respect to the Securities subject to purchase in
accordance with Article 4 as provided in this Indenture), except payments
and distributions made by the Trustee as permitted by the first or second
paragraph of Section 6.05, and shall not purchase or otherwise acquire for
value any Securities if:

 

(a)        a default in the payment of principal, premium, interest,
rent or other obligations due on any Senior Indebtedness occurs and is
continuing (or, in the case of Senior Indebtedness for which there is a period
of grace, in the event of such a default that continues beyond the period of
grace, if any, specified in the instrument or lease evidencing such Senior
Indebtedness), unless and until such default shall have been cured or waived or
shall have ceased to exist and notice thereof has been given to the Trustee; or

 

(b)        a default, other than a payment default, on Designated Senior
Indebtedness occurs and is continuing that then permits holders of such
Designated Senior Indebtedness to accelerate its maturity and the Trustee
receives a notice of the default (a “Payment Blockage Notice”) from the Company
or a holder of Designated Senior Indebtedness or a representative of such
holder.

 

The Company
may and shall resume payments on and distributions in respect of the Securities
upon:

 

(i)            in
the case of a payment default of Senior Indebtedness, upon the date on which
such default is cured or waived or otherwise ceases to exist; and

 

43

 

(ii)           in
the case of a non-payment default on Designated Senior Indebtedness referred to
in clause (b) above, the earlier of (A) 179 days after the date on
which a Payment Blockage Notice is received, and (B) the date on which the
non-payment default is cured or waived or otherwise ceases to exist, unless this
Article 6 otherwise prohibits the payment or distribution at the time of
such payment or distribution.

 

Subject to the provisions of Section 6.05,
no subsequent Payment Blockage pursuant to this Section 6.02 may be
commenced unless (i) at least 365 days shall have elapsed since the
Company’s receipt of the immediately prior Payment Blockage Notice and (ii) all
scheduled payments of principal, premium or interest on the Securities that
have come due have been paid in full in cash. 
No nonpayment default that existed or was continuing on the date of
delivery of any Payment Blockage Notice to the Trustee (unless such default was
waived, cured or otherwise ceased to exist and thereafter subsequently
reoccurred) shall be, or be made, the basis for a subsequent Payment Blockage
Notice.

 

Upon any payment by the Company, or
distribution of assets of the Company of any kind or character, whether in
cash, property or securities, to creditors upon any dissolution or winding-up
or liquidation or reorganization of the Company (whether voluntary or
involuntary) or in bankruptcy, insolvency, receivership or similar proceedings,
all amounts due or to become due upon all Senior Indebtedness shall first be
paid in full in cash, or other payment satisfactory to the holders of Senior
Indebtedness (except payments made pursuant to Article 11 from monies
deposited with the Trustee pursuant thereto prior to commencement of
proceedings for such dissolution, winding-up, liquidation or reorganization);
and upon any such dissolution or winding-up or liquidation or reorganization of
the Company or bankruptcy, insolvency, receivership or other similar
proceeding, any payment by the Company, or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
which the Holders of the Securities or the Trustee would be entitled, except
for the provision of this Article 6, shall (except as aforesaid) be paid
by the Company or by any receiver, trustee in bankruptcy, liquidating trustee,
agent or other Person making such payment or distribution, or by the Holders of
the Securities or by the Trustee under this Indenture if received by them or
it, directly to the holders of Senior Indebtedness (pro rata to such holders on
the basis of the respective amounts of Senior Indebtedness held by such
holders, or as otherwise required by law or a court order) or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any Senior Indebtedness
may have been issued, as their respective interests may appear, to the extent
necessary to pay all Senior Indebtedness in full in cash, or other payment
satisfactory to the holders of Senior Indebtedness, after giving effect to any
concurrent payment or distribution to or for the holders of Senior
Indebtedness, before any payment or distribution is made to the Holders of the
Securities or to the Trustee.

 

In the event of the acceleration of the
Securities because of an Event of Default, no payment or distribution shall be
made to the Trustee or any Holder of Securities in respect of the principal of,
premium, if any, or interest on the Securities (including, but not limited to,
the Fundamental Change Repurchase Price with respect to the Securities subject
to purchase in accordance with Article 4 as provided in this Indenture),
except payments and distributions made 

 

44

 

by the Trustee as permitted by the first or
second paragraph of Section 6.05, until all Senior Indebtedness has been
paid in full in cash or other payment satisfactory to the holders of Senior
Indebtedness or such acceleration is rescinded in accordance with the terms of
this Indenture.  If payment of the
Securities is accelerated because of an Event of Default, the Company shall
promptly notify holders of Senior Indebtedness of such acceleration.

 

In the event that, notwithstanding the
foregoing provisions, any payment or distribution of assets of the Company of
any kind or character, whether in cash, property or securities (including,
without limitation, by way of setoff or otherwise), prohibited by the
foregoing, shall be received by the Trustee or the Holders of the Securities
before all Senior Indebtedness is paid in full, in cash or other payment
satisfactory to the holders of Senior Indebtedness, or provision is made for
such payment thereof in accordance with its terms in cash or other payment
satisfactory to the holders of Senior Indebtedness, such payment or
distribution shall be held in trust for the benefit of and shall be paid over
or delivered to the holders of Senior Indebtedness or their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing any Senior Indebtedness may have been issued,
as their respective interests may appear, as calculated by the Company, for
application to the payment of all Senior Indebtedness remaining unpaid to the
extent necessary to pay all Senior Indebtedness in full, in cash or other
payment satisfactory to the holders of Senior Indebtedness, after giving effect
to any concurrent payment or distribution to or for the holders of such Senior
Indebtedness.

 

Nothing in this Section 6.02 shall apply
to claims of, or payments to, the Trustee under or pursuant to Section 10.07.  This Section 6.02 shall be subject to
the further provisions of Section 6.05.

 

For purposes of this Article 6, the
words, “cash, property or securities” shall not be deemed to include shares of
stock of the Company as reorganized or readjusted, or securities of the Company
or any other corporation provided for by a plan of reorganization or
readjustment, the payment of which is subordinated at least to the extent
provided in this Article 6 with respect to the Securities to the payment
of all Senior Indebtedness which may at the time be outstanding; provided that (i) the Senior Indebtedness is assumed by
the new corporation, if any, resulting from any reorganization or readjustment,
and (ii) the rights of the holders of Senior Indebtedness (other than
leases which are not assumed by the Company or the new corporation, as the case
may be) are not, without the consent of such Holders, altered by such
reorganization or readjustment.  The
consolidation of the Company with, or the merger of the Company into, another
corporation or the liquidation or dissolution of the Company following the
conveyance or transfer of its property as an entirety, or substantially as an
entirety, to another corporation upon the terms and conditions provided for in Article 8
shall not be deemed a dissolution, winding-up, liquidation or reorganization
for the purposes of this Section 6.02 if such other corporation shall, as
a part of such consolidation, merger, conveyance or transfer, comply with the
conditions stated in Article 8.

 

Section 6.03.  Subrogation of
Securities.  Subject to the
payment in full, in cash or other payment satisfactory to the holders of Senior
Indebtedness, of all Senior Indebtedness, the rights 

 

45

 

of the Holders of the Securities shall be
subrogated to the extent of the payments or distributions made to the holders
of such Senior Indebtedness pursuant to the provisions of this Article 6
(equally and ratably with the holders of all indebtedness of the Company which
by its express terms is subordinated to other indebtedness of the Company to
substantially the same extent as the Securities are subordinated and is
entitled to like rights of subrogation) to the rights of the holders of Senior
Indebtedness to receive payments or distributions of cash, property or
securities of the Company applicable to the Senior Indebtedness until the
principal, premium, if any, and interest on the Securities shall be paid in
full in cash or other payment satisfactory to the holders of Senior
Indebtedness.  For the purposes of such
subrogation, no payments or distributions to the holders of the Senior
Indebtedness of any cash, property or securities to which the Holders of the
Securities or the Trustee would be entitled except for the provisions of this Article 6,
and no payment pursuant to the provisions of this Article 6, to or for the
benefit of the holders of Senior Indebtedness by Holders of the Securities or
the Trustee, shall, as between the Company, its creditors other than holders of
Senior Indebtedness, and the Holders of the Securities, be deemed to be a
payment by the Company to or on account of the Senior Indebtedness.  No payments or distributions of cash,
property or securities to or for the benefit of the Holders of the Securities,
pursuant to the subrogation provisions of this Article 6, which would
otherwise have been paid to the holders of Senior Indebtedness shall be deemed
to be a payment by the Company to or for the account of the Securities.  It is understood that the provisions of this Article 6
are and are intended solely for the purposes of defining the relative rights of
the Holders of the Securities, on the one hand, and the holders of the Senior
Indebtedness, on the other hand.

 

Nothing contained in this Article 6 or
elsewhere in this Indenture or in the Securities is intended to or shall
impair, as among the Company, its creditors other than the holders of Senior
Indebtedness, and the Holders of the Securities, the obligation of the Company,
which is absolute and unconditional, to pay to the Holders of the Securities
the principal of, and premium, if any, and interest on the Securities as and
when the same shall become due and payable in accordance with their terms, or
is intended to or shall affect the relative rights of the Holders of the
Securities and creditors of the Company other than the holders of the Senior
Indebtedness, nor shall anything herein or therein prevent the Trustee or the
Holder of any Security from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture, subject to the rights, if
any, under this Article 6 of the holders of Senior Indebtedness in respect
of cash, property or securities of the Company received upon the exercise of
any such remedy.

 

Upon any payment or distribution of assets of
the Company referred to in this Article 6, the Trustee, subject to the
provisions of Section 10.01, and the Holders of the Securities shall be
entitled to rely upon any order or decree made by any court of competent
jurisdiction in which such bankruptcy, dissolution, winding-up, liquidation or
reorganization proceedings are pending, or a certificate of the receiver,
trustee in bankruptcy, liquidating trustee, agent or other person making such
payment or distribution, delivered to the Trustee or to the Holders of the
Securities, for the purpose of ascertaining the persons entitled to participate
in such distribution, the holders of the Senior Indebtedness and other indebtedness
of the Company, the amount thereof or payable thereon and all other facts
pertinent thereto or to this Article 6.

 

46

 

Section 6.04.  Authorization to Effect
Subordination.  Each Holder of
a Security by the Holder’s acceptance thereof authorizes and directs the
Trustee on the Holder’s behalf to take such action as may be necessary or
appropriate to effectuate the subordination as provided in this Article 6
and appoints the Trustee to act as the Holder’s attorney-in-fact for any and
all such purposes.  If the Trustee does
not file a proper proof of claim or proof of debt in the form required in any
proceeding referred to in Section 6.03 hereof at least 30 days before the
expiration of the time to file such claim, the holders of any Senior
Indebtedness or their representatives are hereby authorized to file an
appropriate claim for and on behalf of the Holders of the Securities.

 

Section 6.05.  Notice to Trustee.  The Company shall give prompt
written notice in the form of an Officers’ Certificate to a Responsible Officer
of the Trustee and to any Paying Agent of (a) all Senior Indebtedness
incurred by the Company, including the names of representatives of such holders
(if actually known by the Company) of holders of Senior Indebtedness and (b) any
fact known to the Company which would prohibit the making of any payment of
monies to or by the Trustee or any Paying Agent in respect of the Securities
pursuant to the provisions of this Article 6.  Notwithstanding the provisions of this Article 6
or any other provision of this Indenture, the Trustee shall not be charged with
knowledge of the existence of any facts which would prohibit the making of any
payment of monies to or by the Trustee in respect of the Securities pursuant to
the provisions of this Article 6, unless and until a Responsible Officer
of the Trustee shall have received written notice thereof at the Corporate
Trust Office from the Company (in the form of an Officers’ Certificate) or a
holder or holders of Senior Indebtedness (or a representative of such holder or
holders) or from any trustee thereof; and before the receipt of any such
written notice, the Trustee, subject to the provisions of Section 10.01,
shall be entitled in all respects to assume that no such facts exist; provided that if on a date not fewer than one Business Day
prior to the date upon which by the terms hereof any such monies may become
payable for any purpose (including, without limitation, the payment of the
principal of, or premium, if any, or interest on any Security) the Trustee
shall not have received, with respect to such monies, the notice provided for
in this Section 6.05, then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive
such monies and to apply the same to the purpose for which they were received,
and shall not be affected by any notice to the contrary which may be received
by it on or after such prior date. 
Notwithstanding anything in this Article 6 to the contrary, nothing
shall prevent any payment by the Trustee to the Holders of monies deposited
with it pursuant to Article 11, and any such payment shall not be subject
to the provisions of Article 6.

 

The Trustee, subject to the provisions of Section 10.01,
shall be entitled to rely on the delivery to it of a written notice by a
representative of such a holder of Senior Indebtedness or a person representing
himself to be a holder of Senior Indebtedness (or a trustee on behalf of such
holder) to establish that such notice has been given by a representative of a
holder of Senior Indebtedness or a trustee on behalf of any such holder or
holders.  In the event that the Trustee
determines in good faith that further evidence is required with respect to the
right of any person as a holder of Senior Indebtedness to participate in any
payment or distribution pursuant to this Article 6, the Trustee may
request such Person to furnish evidence to the reasonable satisfaction of the
Trustee as to the amount of Senior Indebtedness held by such Person, the extent
to which 

 

47

 

such Person is entitled to participate in
such payment or distribution and any other facts pertinent to the rights of
such Person under this Article 6, and if such evidence is not furnished
the Trustee may defer any payment to such Person pending judicial determination
as to the right of such Person to receive such payment.

 

Section 6.06.  Trustee’s Relation to Senior
Indebtedness.  The Trustee in
its individual capacity shall be entitled to all the rights set forth in this Article 6
in respect of any Senior Indebtedness at any time held by it, to the same
extent as any other holder of Senior Indebtedness, and nothing in Section 10.11
or elsewhere in this Indenture shall deprive the Trustee of any of its rights
as such holder.

 

With respect to the holders of Senior
Indebtedness, the Trustee undertakes to perform or to observe only such of its
covenants and obligations as are specifically set forth in this Article 6,
and no implied covenants or obligations with respect to the holders of Senior
Indebtedness shall be read into this Indenture against the Trustee.  The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Indebtedness and, subject to the
provisions of Section 10.01, the Trustee shall not be liable to any holder
of Senior Indebtedness if it shall, mistakenly or otherwise, pay over or
deliver to Holders of Securities, the Company or any other person money or assets
to which any holder of Senior Indebtedness shall be entitled by virtue of this Article 6
or otherwise.

 

Section 6.07.  No Impairment of
Subordination.  No right of
any present or future holder of any Senior Indebtedness to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Company or by any act
or failure to act, in good faith, by any such holder, or by any noncompliance
by the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof which any such holder may have or otherwise
be charged with.

 

Section 6.08.  Certain Conversions Deemed
Payment.  For the purposes of
this Article 6 only, (a)  the issuance and delivery of junior
securities upon conversion of Securities in accordance with Article 5
shall not be deemed to constitute a payment or distribution on account of the
principal of (or premium, if any) or interest on Securities or on account of
the purchase or other acquisition of Securities, and (b)  the payment,
issuance or delivery of cash (except in satisfaction of fractional shares
pursuant to Section 5.03), property or securities (other than junior
securities) upon conversion of a Security shall be deemed to constitute payment
on account of the principal of such Security. 
For the purposes of this Section 6.08, the term “junior securities”
means (i) shares of any Capital Stock of any class of the Company, or (ii) securities
of the Company which are subordinated in right of payment to all Senior
Indebtedness which may be outstanding at the time of issuance or delivery of
such securities to substantially the same extent as, or to a greater extent
than, the Securities are so subordinated as provided in this Article.  Nothing contained in this Article 6 or
elsewhere in this Indenture or in the Securities is intended to or shall
impair, as among the Company, its creditors other than holders of Senior
Indebtedness and the Holders, the right, which is absolute and unconditional,
of the Holder of any Security to convert such Security in accordance with Article 5.

 

48

 

Section 6.09.  Article Applicable to
Paying Agents.  If at any time
any Paying Agent other than the Trustee shall have been appointed by the
Company and be then acting hereunder, the term “Trustee” as used in this Article shall
(unless the context otherwise requires) be construed as extending to and
including such Paying Agent within its meaning as fully for all intents and
purposes as if such Paying Agent were named in this Article in addition to
or in place of the Trustee; provided, however,
that the first paragraph of Section 6.05 shall not apply to the Company or
any Affiliate of the Company if it or such Affiliate acts as Paying Agent.

 

Section 6.10.  Senior Indebtedness Entitled
to Rely.  The holders of
Senior Indebtedness (including, without limitation, Designated Senior
Indebtedness) shall have the right to rely upon this Article 6, and no
amendment or modification of the provisions contained herein shall diminish the
rights of such holders unless such holders shall have agreed in writing
thereto.

 

Section 6.11.  Reliance on Judicial Order or
Certificate of Liquidating Agent.  Upon
any payment or distribution of assets of the Company referred to in this
Article, the Trustee, subject to the provisions of Section 7.01, and the
Holders of the Securities shall be entitled to conclusively rely upon any order
or decree entered by any court of competent jurisdiction in which such
insolvency, bankruptcy, receivership, liquidation, reorganization, dissolution,
winding up or similar case or proceeding is pending, or a certificate of the
trustee in bankruptcy, liquidating trustee, Securities Custodian, receiver, assignee
for the benefit of creditors, agent or other person making such payment or
distribution, delivered to the Trustee or to the Holders of Securities, for the
purpose of ascertaining the persons entitled to participate in such payment or
distribution, the holders of Senior Indebtedness and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article.

 

Section 6.12.  Rights of Trustee as Holder of
Senior Indebtedness; Preservation of Trustee’s Rights.  The Trustee or any authenticating
agent in its individual capacity shall be entitled to all the rights set forth
in this Article with respect to any Senior Indebtedness which may at any
time be held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee or any
authenticating agent of any of its rights as such holder.

 

Nothing in this Article shall apply to
claims of, or payments to, the Trustee under or pursuant to Section 10.07.

 

ARTICLE 7.

COVENANTS

 

Section 7.01.  Payment of Securities.

 

(a)        The Company shall promptly make all payments in respect of
the Securities on the dates and in the manner provided in the Securities and
this Indenture.  A payment of principal
or interest shall be considered paid on the date it is due if the Paying Agent
(other than the 

 

49

 

Company) holds by 12:00 p.m.  (noon), New York City time, on that date
money, deposited by or on behalf of the Company sufficient to make the
payment.  Subject to Section 5.02,
accrued and unpaid interest on any Security that is payable, and is punctually
paid or duly provided for, on any Interest Payment Date shall be paid to the
Person in whose name that Security is registered at the close of business on
the Regular Record Date for such interest at the office or agency of the
Company maintained for such purpose. 
Principal, Fundamental Change Repurchase Price, and interest, if
payable, shall be considered paid on the applicable date due if on such date
(or, in the case of Fundamental Change Repurchase Price, on the Business Day
following the applicable Fundamental Change Repurchase Date) the Trustee or the
Paying Agent holds, in accordance with this Indenture, money sufficient to pay
all such amounts then due.  The Company
shall, to the fullest extent permitted by law, pay interest in immediately
available funds on overdue principal amount and interest at the annual rate
borne by the Securities compounded semiannually, which interest shall accrue
from the date such overdue amount was originally due to the date payment of
such amount, including interest thereon, has been made or duly provided for.  All such interest shall be payable on demand.

 

(b)        Payment of the principal of and interest, if any, on the
Securities shall be made at the office or agency of the Company maintained for
that purpose (which shall initially be at the address set forth in Section 2.03(c))
in such coin or currency of the United States of America as at the time of
payment is legal tender for payment of public and private debts; provided, however, that at the option of the Company payment
of interest may be made by check mailed to the address of the Person entitled
thereto as such address appears in the Register; provided further that a Holder
with an aggregate principal amount in excess of $2,000,000 will be paid by wire
transfer in immediately available funds at the election of such Holder if such
Holder has provided wire transfer instructions to the Trustee at least 10
Business Days prior to the payment date. 
Any wire transfer instructions received by the Trustee will remain in
effect until revoked by the Holder. 
Notwithstanding the foregoing, so long as this Security is registered in
the name of a Depositary or its nominee, all payments hereon shall be made by
wire transfer of immediately available funds to the account of the Depositary
or its nominee.

 

Section 7.02.  SEC and Other Reports.

 

(a)        The Company shall deliver to the Trustee all reports and
other information and documents which it is required to file with the SEC
pursuant to Section 13 or 15(d) of the Exchange Act (including its
Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q),
within 15 days after it files them with the SEC; provided
that any such reports, information and documents filed with the SEC pursuant to
its Electronic Data Gathering, Analysis and Retrieval (or EDGAR) system shall
be deemed to be filed with the Trustee. 
In the event that the Company is no longer subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act, the Company
shall continue to provide the Trustee with reports containing substantially the
same information as would be required to be filed with the SEC had the Company
continued to have been subject to such reporting requirements.  In such event, such reports will be provided
at the times the Company would have been required to provide reports had it
continued to be subject to such reporting requirements.  The Company also shall comply with the
provisions of TIA Section 314(a).

 

50

 

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

 

Section 7.03.  Compliance Certificates.  The Company shall deliver to the
Trustee, within 90 days after the end of each fiscal year of the Company
(beginning with the fiscal year ending December 31, 2007), an Officers’
Certificate as to the signer’s knowledge of the Company’s compliance with all
conditions and covenants on its part contained in this Indenture and stating
whether or not the signer knows of any Default or Event of Default.  If such signer knows of such a Default or
Event of Default, the Officers’ Certificate shall describe the Default or Event
of Default and the efforts to remedy the same. 
For the purposes of this Section 7.03, compliance shall be
determined without regard to any grace period or requirement of notice provided
pursuant to the terms of this Indenture.

 

Section 7.04.  Further Instruments and
Acts.  The Company will
execute and deliver such further instruments and do such further acts as may be
reasonably necessary or proper to carry out more effectively the purposes of
this Indenture.

 

Section 7.05.  Maintenance of Corporate
Existence.  Subject to Article 8,
the Company will do or cause to be done all things necessary to preserve and
keep in full force and effect its corporate existence.

 

Section 7.06.  Stay, Extension and Usury
Laws.  The Company covenants
(to the extent that it may lawfully do so) that it shall not at any time insist
upon, plead, or in any manner whatsoever claim or take the benefit or advantage
of, any stay, extension or usury law or other law which would prohibit or
forgive the Company from paying all or any portion of the principal of or
accrued but unpaid interest on the Securities as contemplated herein, wherever
enacted, now or at any time hereafter in force, or which may affect the
covenants or the performance of this Indenture, and the Company (to the extent
it may lawfully do so) hereby expressly waives all benefit or advantage of any
such law and covenants that it will not, by resort to any such law, hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law
had been enacted.

 

Section 7.07.  Maintenance of Office or Agency.  The Company will maintain an
office or agency of the Trustee, Registrar and Paying Agent where securities
may be presented or surrendered for payment, where Securities may be
surrendered for registration of transfer or purchase and where notices and
demands to or upon the company in respect of the Securities and this Indenture
may be served.  The Corporate Trust
Office shall initially be one such office or agency for all of the aforesaid
purposes.  The Company shall give prompt
written notice to the Trustee of the location, and of any change in the
location, of any such office or agency (other than a change in the location of
the office of the Trustee).  If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the 

 

51

 

address thereof, such presentations,
surrenders, notices and demands may be made or served at the address of the
Trustee set forth in Section 13.02.

 

The Company may also from time to time
designate one or more other offices or agencies where the Securities may be
presented or surrendered for any or all such purposes and may from time to time
rescind such designations; provided, however,
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency.

 

ARTICLE 8

CONSOLIDATION;
MERGER; CONVEYANCE; TRANSFER OR LEASE

 

Section 8.01.  Company May Consolidate,
Etc., Only on Certain Terms.  The
Company may not consolidate with or merge into any Person (unless the Company
is the surviving corporation) or convey, transfer or lease the property and
assets, substantially as an entirety, of the Company to another Person, other
than to one or more of the Company’s wholly-owned subsidiaries, unless:

 

(a)        the Person (if other than the Company) formed by such
consolidation or into which the Company is merged, or the Person which acquires
by conveyance, transfer or lease all or substantially all of the properties and
assets of the Company, shall (i) be a corporation, limited liability
company, partnership, trust or other business entity organized and existing
under the laws of the United States of America, any State thereof or the
District of Columbia and (ii) such Person (if other than the Company)
expressly assumes, by an indenture supplemental hereto, executed and delivered
to the Trustee, in form satisfactory to the Trustee, the obligations of the
Company under the Securities and this Indenture and the performance or observance
of every covenant and provision of this Indenture and the Securities required
on the part of the Company to be performed or observed and the conversion
rights shall be provided for in accordance with Article 5, by supplemental
indenture satisfactory in form to the Trustee, executed and delivered to the
Trustee, by the Person (if other than the Company) formed by such consolidation
or into which the Company shall have been merged or by the Person which shall
have acquired the Company’s assets;

 

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

 

(c)        if the Company will not be the resulting or surviving
corporation, the Company shall have, at or prior to the effective date of such
consolidation, merger or transfer, delivered to the Trustee an Officers’
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger or transfer complies with this Section 8.01 and, if a supplemental
indenture is required in connection with such transaction, such supplemental
indenture complies with this Article, and that all conditions precedent herein
provided for relating to such transaction have been complied with.

 

52

 

Section 8.02.  Successor Substituted.  Upon any consolidation of the
Company with, or merger of the Company into, any other Person or any
conveyance, transfer or lease substantially as an entirety, of the properties
and assets of the Company and its Subsidiaries, taken as a whole, in accordance
with Section 8.01, the successor Person formed by such consolidation or
into which the Company is merged or to which such conveyance, transfer or lease
is made shall succeed to, and be substituted for, and may exercise every right
and power of, the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein, and thereafter, except
in the case of a lease, and except for obligations the predecessor Person may
have under a supplemental indenture, the predecessor Person shall be relieved
of all obligations and covenants under this Indenture and the Securities.

 

ARTICLE 9

DEFAULT AND REMEDIES

 

Section 9.01.  Events of Default.

 

(a)        An “Event of Default” shall occur if:

 

(i)            the
Company shall fail to pay when due the Principal, Redemption Price or any
Fundamental Change Repurchase Price of any Security, when the same becomes due
and payable, whether or not such payment is prohibited by the subordination
provisions hereunder; or

 

(ii)           the
Company shall fail to pay an installment of interest, on any of the Securities,
which failure continues for 30 days after the date when due whether or not such
payment is prohibited by the subordination provisions hereunder; or

 

(iii)          the
Company shall fail to deliver when due all shares of Common Stock, including
any Make-Whole Premium, if any, and any cash deliverable upon conversion of the
Securities, which failure continues for 10 days; or

 

(iv)          the
Company shall fail to perform or observe (or obtain a waiver with respect to)
any other term, covenant or agreement contained in the Securities or this
Indenture for a period of 75 days after receipt by the Company of a Notice of
Default specifying such failure; or

 

(v)           the
Company shall fail to pay any principal by the end of any applicable grace
period or resulting in acceleration of other Indebtedness of the Company for
borrowed money where the aggregate principal amount with respect to which the
default or acceleration has occurred exceeds $15 million, provided
that if any such default is cured, waived, rescinded or annulled, then the
Event of Default by reason thereof would be deemed not to have occurred;

 

53

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

(A)            grants
relief against the Company in an involuntary case or proceeding or adjudicates
the Company insolvent or bankrupt;

 

(B)            appoints
a Receiver of the Company or for all or substantially all of the property of
the Company; or

 

(C)            orders
the winding up or liquidation of the Company;

 

and in each case the order or decree remains
unstayed and in effect for 60 consecutive days.

 

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

 

(b)        Notwithstanding Section 9.01(a), no Event of Default
under clause (iv) of Section 9.01(a) shall occur until the
Trustee notifies the Company in writing upon the written direction of the
Holders of at least 25% in aggregate principal amount of the Securities then
outstanding, or the Holders of at least 25% in aggregate principal amount of
the Securities then outstanding notify the Company and the Trustee in writing,
of the Default (a “Notice of Default”), and the Company does not cure the
Default within the time specified in clauses (iv) of Section 9.01(a) after
receipt of such notice.  A notice given
pursuant to this Section 9.01 shall be given by registered or certified
mail, must specify the Default, demand that it be remedied and

 

54

 

state that the notice is a Notice of Default.  When any Default under this Section 9.01
is cured, it ceases.

 

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

 

The
Trustee shall not be charged with knowledge of any Event of Default unless
written notice thereof shall have been given to a Responsible Officer with
responsibility for this Indenture at the Corporate Trust Office of the Trustee
by the Company, a Paying Agent, any Holder or any agent of any Holder or unless
a Responsible Officer with responsibility for this Indenture acquires actual
knowledge of such Event of Default in the course of performing other duties
pursuant to this Indenture.

 

Section 9.02.  Acceleration. 
If an Event of Default (other than an Event of Default
specified in clause (vi) or (vii) of Section 9.01(a)) occurs and
is continuing with respect to the Company, the Trustee may, by notice to the
Company, and shall upon the written direction of the Holders of at least 25% in
aggregate principal amount of the Securities then outstanding, or the Holders
of at least 25% in aggregate principal amount of the Securities then
outstanding may, by notice to the Company and the Trustee, declare the
principal amount and accrued and unpaid interest, if any, through the date of
declaration on all the Securities to be immediately due and payable; provided, however, that so long as any Designated Senior
Indebtedness is outstanding, such acceleration of the Securities shall not be
effective until the earlier of (x) an acceleration of such Designated
Senior Indebtedness or (y) five (5) Business Days after receipt by
the Trustee of written notice of such acceleration of the Securities.  Upon such a declaration, such principal
amount and such accrued and unpaid interest, if any, shall be due and payable
immediately.  If an Event of Default
specified in Section 9.01(a)(vi) or (vii) occurs in respect of
the Company and is continuing, the principal amount and accrued but unpaid
interest, if any, on all the Securities shall become and be immediately due and
payable without any declaration or other act on the part of the Trustee or any
Holders of Securities.  The Holders of a
majority in aggregate principal amount of the Securities then outstanding by
notice to the Trustee may rescind an acceleration and its consequences if (a) all
existing Events of Default, other than the nonpayment of the principal of the
Securities which have become due solely by such declaration of acceleration,
have been cured or waived; (b) to the extent the payment of such interest
is lawful, interest (calculated at the rate per annum borne by the Securities)
on overdue installments of interest and overdue principal, which has become due
otherwise than by such declaration of acceleration, has been paid; (c) the
rescission would not conflict with any judgment or decree of a court of
competent jurisdiction; and (d) all payments due to the Trustee and any
predecessor Trustee under Section 10.07 have been made.  No such rescission shall affect any
subsequent Default or impair any right consequent thereto.

 

Notwithstanding
the acceleration provision above, to the extent elected by the Company, the
sole remedy for an Event of Default relating to the failure to comply with the
reporting obligations in the indenture with respect to SEC filings that are
described above under Section 7.02(a), and for any failure to comply with
the requirements of Section 314(a)(1) of the Trust Indenture Act,
will for the first 180 days after the occurrence of such an Event of Default
consist 

 

55

 

exclusively of the right to receive special interest on the Securities
at an annual rate equal to 1.0% of the outstanding principal amount of the
Securities.  This special interest will
be paid semi-annually in arrears, with the first semi-annual payment due on the
first Interest Payment Date following the date on which the special interest
began to accrue on any Securities.  The
special interest will accrue on all outstanding Securities from and including
the date on which an Event of Default relating to a failure to comply with the
reporting obligations hereunder first occurs to but not including the 180th day
(or earlier, if the Event of Default relating to the reporting obligations is
cured or waived prior to such 180th day), whereupon such special interest will
cease to accrue and, if the Event of Default relating to reporting obligations
has not been cured or waived prior to such 180th day, the Securities will be
subject to acceleration as provided above. 
In the event the Company does not elect to pay special interest upon an
Event of Default in accordance with this paragraph, the Securities will be
subject to acceleration as provided above.

 

Section 9.03.  Other Remedies.

 

(a)        If
an Event of Default occurs and is continuing, the Trustee may, but shall not be
obligated to, pursue any available remedy by proceeding at law or in equity to
collect payment of the principal amount and accrued and unpaid interest, if
any, on the Securities or to enforce the performance of any provision of the
Securities or this Indenture.

 

(b)        The
Trustee may maintain a proceeding even if it does not possess any of the
Securities or does not produce any of them in the proceeding.  A delay or omission by the Trustee or any
Holder in exercising any right or remedy accruing upon an Event of Default
shall not impair the right or remedy or constitute a waiver of or acquiescence
in the Event of Default.  No remedy is
exclusive of any other remedy.  All
available remedies are cumulative to the extent permitted by applicable law.

 

Section 9.04.  Waiver of Defaults and Events of
Default.  Subject to Sections
9.02, 9.07 and 12.02, the Holders of a majority in aggregate principal amount
of the Securities then outstanding by notice to the Trustee may waive an
existing Default or Event of Default and its consequences, except an uncured
Default or Event of Default in the payment of the principal of, premium, if
any, or any accrued but unpaid interest on any Security, an uncured failure by
the Company to convert any Securities into Common Stock or any Default or Event
of Default in respect of any provision of this Indenture or the Securities
which, under Section 12.02, cannot be modified or amended without the
consent of the Holder of each Security affected.  When a Default or Event of Default is waived,
it is cured and ceases to exist.

 

Section 9.05.  Control by Majority.  The Holders of a majority in
aggregate principal amount of the Securities then outstanding may direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee or exercising any trust or power conferred on it.  However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture, that the Trustee
determines may be unduly prejudicial to the rights of another Holder or the
Trustee, or that may involve the Trustee in personal liability unless the
Trustee is 

 

56

 

offered security or indemnity satisfactory to it; provided,
however, that the Trustee may take any other action deemed proper by
the Trustee which is not inconsistent with such direction.

 

Section 9.06.  Limitations on Suits.

 

(a)        A
Holder may not pursue any remedy with respect to this Indenture or the
Securities (except actions for payment of overdue principal, premium, if any,
or interest or for the conversion of the Securities pursuant to Article 5)
unless:

 

(i)    the Holder gives to the
Trustee written notice of a continuing Event of Default;

 

(ii)   the Holders of at least 25%
in aggregate principal amount of the then outstanding Securities make a written
request to the Trustee to pursue the remedy;

 

(iii)  such Holder or Holders
offer to the Trustee security or indemnity acceptable to the Trustee against
any loss, liability or expense;

 

(iv)  the Trustee does not comply
with the request within 60 days after receipt of the request and the offer of
security or indemnity; and

 

(v)   no direction inconsistent
with such written request has been given to the Trustee during such 60-day
period by the Holders of a majority in aggregate principal amount of the
Securities then outstanding.

 

(b)        No
Holder of a Security shall have any right under any provision of this Indenture
or the Securities to affect, disturb, or prejudice the rights of another Holder
of a Security or to obtain a preference or priority over another Holder of a
Security.

 

Section 9.07.  Rights of Holders to Receive Payment and to
Convert.  Notwithstanding any
other provision of this Indenture, the right of any Holder of a Security to
receive payment of the principal amount, Fundamental Change Repurchase Price,
or Make-Whole Premium and interest, if any in respect of the Securities held by
such Holder, on or after the respective due dates expressed in the Securities
and this Indenture, (whether upon repurchase or otherwise), and to convert such
Security in accordance with Article 5, and to bring suit for the
enforcement of any such payment on or after such respective due dates or for
the right to convert in accordance with Article 5, is, subject to
compliance with the provisions of Section 9.06, absolute and unconditional
and shall not be impaired or affected without the consent of the Holder.

 

Section 9.08.  Collection Suit by Trustee.  If an Event of Default described
in clause (i) or (ii) of Section 9.01(a) occurs and is
continuing, the Trustee may recover judgment in its own name and as trustee of
an express trust against the Company or another obligor on the Securities for
the whole amount owing with respect to the Securities and such further amount
as shall be sufficient to cover the costs and expenses of collection, including
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel.

 

57

 

Section 9.09.  Trustee May File Proofs of Claim.  The Trustee may file such proofs
of claim and other papers or documents as may be necessary or advisable in
order to have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel) and the Holders allowed in any judicial proceedings relative to
the Company (or any other obligor on the Securities), its creditors or its
property and shall be entitled and empowered to collect and receive any money
or other property payable or deliverable on any such claims and to distribute
the same, and any Receiver in any such judicial proceeding is hereby authorized
by each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders,
to pay to the Trustee any amount due to it for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel,
and any other amounts due the Trustee under Section 10.07, and to the
extent that such payment of the reasonable compensation, expenses, disbursements
and advances in any such proceedings shall be denied for any reason, payment of
the same shall be secured by a lien on, and shall be paid out of, any and all
distributions, dividends, money, securities and other property which the
Holders may be entitled to receive in such proceedings, whether in liquidation
or under any plan of reorganization or arrangement or otherwise.  Nothing herein contained shall be deemed to
authorize the Trustee to authorize or consent to, or, on behalf of any Holder,
to authorize, accept or adopt any plan of reorganization, arrangement,
adjustment or composition affecting the Securities or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
Holder in any such proceeding.

 

Section 9.10.  Priorities.

 

(a)        If
the Trustee collects any money pursuant to this Article 9, it shall pay
out the money in the following order:

 

(i)    First, to the Trustee for
amounts due under Section 10.07;

 

(ii)   Second, to the Holders of
Senior Indebtedness to the extent required by Article 6;

 

(iii)  Third, to Holders for
amounts due and unpaid on the Securities for the principal amount and interest,
as applicable, ratably, without preference or priority of any kind, according
to such respective amounts due and payable on the Holders’ Securities; and

 

(iv)  Fourth, the balance, if any,
to the Company.

 

(b)        The
Trustee may fix a record date and payment date for any payment to Holders
pursuant to this Section 9.10.

 

Section 9.11.  Undertaking for Costs.  In any suit for the enforcement of
any right or remedy under this Indenture or in any suit against the Trustee for
any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an 

 

58

 

undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable attorneys’ fees
and expenses (whether incurred before trial, at trial, on appeal or in any bankruptcy
or arbitration or other administrative proceeding), against any party litigant
in the suit, having due regard to the merits and good faith of the claims or
defenses made by the party litigant. 
This Section 9.11 does not apply to a suit made by the Trustee, a
suit by a Holder pursuant to Section 9.07, or a suit by Holders of more
than 10% in aggregate principal amount of the Securities then outstanding.  This Section 9.11 shall be in lieu of Section 315(e) of
the TIA and such Section 315(e) is hereby expressly excluded from
this Indenture, as permitted by the TIA.

 

ARTICLE 10

TRUSTEE

 

Section 10.01.  Obligations of Trustee.

 

(a)        If
an Event of Default of which a Responsible Officer of the Trustee shall have
actual knowledge has occurred and is continuing, the Trustee may (and shall
upon the written direction of the Holders of at least 25% in aggregate
principal amount of the Securities then outstanding and being furnished with
indemnity acceptable to it) exercise such of the rights and powers vested in it
by this Indenture.  If an Event of
Default of which a Responsible Officer of the Trustee shall have actual
knowledge has occurred and is continuing, the Trustee shall use the same degree
of care and skill in its exercise as a prudent person would exercise or use
under the circumstances in the conduct of his or her own affairs.

 

(b)        Except
during the continuance of an Event of Default of which a Responsible Officer of
the Trustee shall have actual knowledge, the Trustee need perform only those
duties as are specifically set forth in this Indenture and no others.

 

This
Section 10.01(b) shall be in lieu of Section 315(a) of the
TIA and such Section 315(a) is hereby expressly excluded from this
Indenture, as permitted by the TIA.

 

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

 

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

 

(i)    this paragraph does not
limit the effect of Section 10.01(b);

 

59

 

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

 

(iii)  the Trustee shall not be
liable with respect to any action it takes or omits to take in good faith in
accordance with this Indenture or a direction received by it pursuant to Section 9.05.

 

This
Section 10.01(d) shall be in lieu of Sections 315(d)(1), 315(d)(2) and
315(d)(3) of the TIA and such Sections are hereby expressly excluded from
this Indenture as permitted by the TIA.

 

(e)        No
provision of this Indenture shall require the Trustee to expend or risk its own
funds or otherwise incur any financial liability in the performance of any of
its duties hereunder or in the exercise of any of its rights or powers unless
the Trustee shall have received adequate security or indemnity in its opinion
against potential costs and liabilities incurred by it relating thereto.

 

(f)         Every
provision of this Indenture that in any way relates to the Trustee is subject
to subsections (a), (b), (c), (d) and (e) of this Section 10.01.

 

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

 

(h)        The
Trustee shall not be liable for any delays occurring as a result of force
majeure.

 

Section 10.02.  Rights of Trustee.

 

(a)        Subject
to Section 10.01:

 

(i)    The Trustee may rely
conclusively and shall be protected in acting or refraining from acting upon any
document believed by it to be genuine and to have been signed or presented by
the proper person.  The Trustee need not
investigate any fact or matter stated in the document.

 

(ii)   Before the Trustee acts or
refrains from acting, it may require an Officers’ Certificate or an Opinion of
Counsel, which shall conform to Section 13.04(b).  The Trustee shall not be liable for any
action it takes or omits to take in good faith in reliance on such Officers’
Certificate or Opinion of Counsel.

 

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

 

60

 

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

 

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

 

(vi)  The Trustee shall be under
no obligation to exercise any of the rights or powers vested in it by this
Indenture or to institute, conduct or defend any litigation hereunder or in
relation hereto at the request or direction of any of the Holders pursuant to
this Indenture, unless such Holders shall have offered to the Trustee security
or indemnity satisfactory to the Trustee against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction.

 

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

 

(viii)                The Trustee
shall not be deemed to have notice or knowledge of any Default or Event of
Default, or Fundamental Change unless a Responsible Officer of the Trustee has
actual knowledge thereof or unless written notice of any event which is in fact
such a Default is received by the Trustee at the Corporate Trust Office, and
such notice references the Securities and this Indenture.  In the absence of receipt of such notice or
actual knowledge, the Trustee may conclusively assume that there is no Default,
Event of Default, or Fundamental Change.

 

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

 

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

 

61

 

Section 10.03.  Individual Rights of Trustee.  The Trustee in its individual or
any other capacity may become the owner or pledgee of Securities and may
otherwise deal with the Company or an Affiliate of the Company with the same
rights it would have if it were not Trustee. 
Any Agent may do the same with like rights.  However, the Trustee is subject to Sections
10.10 and 10.11.

 

Section 10.04.  Trustee’s Disclaimer.  The Trustee makes no
representation as to the validity or adequacy of this Indenture or the
Securities.  It shall not be accountable
for the Company’s use of the proceeds from the Securities and it shall not be
responsible for any statement in the Securities other than its certificate of
authentication.

 

Section 10.05.  Notice of Default or Events of Default.  If a Default or an Event of
Default occurs and is continuing and if it is known to a Responsible Officer of
the Trustee, the Trustee shall mail to each Holder of a Security notice of all
uncured Defaults or Events of Default known to it within 90 days after it
occurs or, if later, within 15 days after it becomes known to the Trustee.  However, the Trustee may withhold the notice
if and for so long as a committee of its Responsible Officers in good faith
determines that withholding notice is in the interests of Holders of
Securities, except in the case of a Default or an Event of Default in payment
of the principal of, or premium, if any, or interest on any Security when due
or in the payment of any purchase obligation, or the Company’s failure to
convert Securities when obligated to convert them.  This Section 10.05 is in lieu of section
315(b) of the TIA and such provision is expressly excluded from this
Indenture as permitted by the TIA.

 

Section 10.06.  Reports by Trustee to Holders.

 

(a)        If
a report is required by TIA Section 313, within 60 days after each May 15,
beginning with the May 15 following the date of this Indenture, the
Trustee shall mail to each Holder of Securities a brief report dated as of such
May 15 that complies with TIA Section 313(a).  If required by TIA Section 313, the
Trustee also shall comply with TIA Sections 313(b)(2), (c) and (d).

 

(b)        A
copy of each report at the time of its mailing to Holders of Securities shall
be mailed to the Company and, to the extent required by the TIA, filed with the
SEC, and each stock exchange, if any, on which the Securities are listed.  The Company shall notify the Trustee whenever
the Securities become listed on any stock exchange or listed or admitted to
trading on any quotation system and any changes in the stock exchanges or
quotation systems on which the Securities are listed or admitted to trading and
of any delisting thereof.

 

Section 10.07.  Compensation and Indemnity.

 

(a)        The
Company shall pay to the Trustee from time to time such compensation (as agreed
to from time to time by the Company and the Trustee in writing) for its
services (which compensation shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust).  The Company shall reimburse the Trustee upon
request for all reasonable disbursements, expenses and advances incurred or
made by it.  Such expenses may 

 

62

 

include the reasonable compensation, disbursements and expenses of the
Trustee’s agents and counsel.

 

(b)        The
Company shall indemnify and hold harmless the Trustee or any predecessor
Trustee (which for purposes of this Section 10.07 shall include its
officers, directors, employees and agents) for, and hold it harmless against,
any and all loss, liability, claim, damage or expense including taxes (other
than franchise taxes and taxes based upon, measured by or determined by the
income of the Trustee), incurred by it in connection with the acceptance or
administration of its duties under this Indenture or any action or failure to
act as authorized or within the discretion or rights or powers conferred upon
the Trustee hereunder including the reasonable costs and expenses of the
Trustee and its counsel in defending (including reasonable legal fees and
expenses whether incurred before trial, at trial, on appeal or in any
bankruptcy or arbitration or other administrative proceeding) itself against
any claim or liability in connection with the exercise or performance of any of
its powers or duties hereunder.  The
Trustee shall notify the Company promptly of any claim asserted against the
Trustee of which it has received written notice for which it may seek
indemnity.  The Company need not pay for
any settlement effected without its prior written consent, which shall not be
unreasonably withheld.

 

(c)        The
Company need not reimburse the Trustee for any expense or indemnify it against
any loss or liability determined to have been caused by its own gross
negligence, willful misconduct or bad faith.

 

(d)        To
secure the Company’s payment obligations in this Section 10.07, the
Trustee shall have a senior claim to which the Securities are hereby made
subordinate on all money or property held or collected by the Trustee.  The obligations of the Company under this Section 10.07
shall survive the satisfaction and discharge of this Indenture or the
resignation or removal of the Trustee.

 

(e)        When
the Trustee incurs expenses or renders services after an Event of Default
specified in clause (vi) or (vii) of Section 9.01(a) occurs,
the expenses and the compensation for the services are intended to constitute
expenses of administration under any Bankruptcy Law.  The provisions of this Section shall
survive the termination of this Indenture.

 

Section 10.08.  Replacement of Trustee.

 

(a)        The
Trustee may resign by so notifying the Company. 
The Holders of a majority in aggregate principal amount of the
Securities then outstanding may remove the Trustee by so notifying the Trustee
and the Company and may, with the Company’s written consent, appoint a
successor Trustee.  The Company may
remove the Trustee at any time, so long as no Default or Event of Default has
occurred and is continuing, and appoint a Successor Trustee in accordance with
this Section 10.08.

 

(b)        If
the Trustee resigns or is removed or if a vacancy exists in the office of
Trustee for any reason, the Company shall promptly appoint a successor
Trustee.  The resignation or 

 

63

 

removal of a Trustee shall not be effective until a successor Trustee
shall have delivered the written acceptance of its appointment as described
below.

 

(c)        If
a successor Trustee does not take office within 45 days after the retiring
Trustee resigns or is removed, the retiring Trustee, the Company or the Holders
of 10% in principal amount of the Securities then outstanding may petition any
court of competent jurisdiction at the expense of the Company for the
appointment of a successor Trustee at the expense of the Company.

 

(d)        If
the Trustee fails to comply with Section 10.10, any Holder may petition
any court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.

 

(e)        A
successor Trustee shall deliver a written acceptance of its appointment to the
retiring Trustee and to the Company. 
Promptly thereafter, the retiring Trustee shall (upon payment of its
charges hereunder) transfer all property held by it as Trustee to the successor
Trustee and be released from its obligations (exclusive of any liabilities that
the retiring Trustee may have incurred while acting as Trustee) hereunder, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture.  A successor
Trustee shall mail notice of its succession to each Holder.

 

(f)         A
retiring Trustee shall not be liable for the acts or omissions of any successor
Trustee after its succession.

 

(g)        Notwithstanding
replacement of the Trustee pursuant to this Section 10.08, the Company’s
obligations under Section 10.07 shall continue for the benefit of the
retiring Trustee.

 

Section 10.09.  Successor Trustee by Merger, Etc.  If the Trustee consolidates with,
merges or converts into, or transfers all or substantially all of its corporate
trust business (including the administration of this Indenture) to, another corporation,
the resulting, surviving or transferee corporation, without any further act,
shall be the successor Trustee; provided such transferee corporation shall
qualify and be eligible under Section 10.10.  Such successor Trustee shall promptly mail
notice of its succession to the Company and each Holder.

 

Section 10.10.  Eligibility; Disqualification.  The Trustee shall always satisfy
the requirements of paragraphs (1), (2) and (5) of TIA Section 310(a).  The Trustee (or its parent holding company)
shall have a combined capital and surplus of at least $50,000,000 as set forth
in its most recent published annual report of condition.  If at any time the Trustee shall cease to
satisfy any such requirements, it shall resign immediately in the manner and
with the effect specified in this Article 10.  The Trustee shall be subject to the
provisions of TIA Section 310(b). 
Nothing herein shall prevent the Trustee from filing with the SEC the
application referred to in the penultimate paragraph of TIA Section 310(b).

 

64

 

Section 10.11.  Preferential Collection of Claims Against
Company.  The Trustee shall
comply with TIA Section 311(a), excluding any creditor relationship listed
in TIA Section 311(b).  A Trustee
who has resigned or been removed shall be subject to TIA Section 311(a) to
the extent indicated therein.

 

ARTICLE 11

SATISFACTION AND DISCHARGE OF INDENTURE

 

Section 11.01.  Satisfaction and Discharge of Indenture.

 

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

 

(i)    all Securities theretofore
authenticated and delivered (other than (A) Securities which have been
destroyed, lost or stolen and which have been replaced or paid as provided in Section 2.07
and (B) Securities for whose payment money has theretofore been deposited
in trust and thereafter repaid to the Company as provided in Section 11.03)
have been delivered to the Trustee for cancellation; or

 

(ii)   all such Securities not
theretofore delivered to the Trustee for cancellation,

 

(A)  have become due and payable,
or

 

(B)   will become due and payable
at the Final Maturity Date within one year; provided in the case of clause
(ii), that

 

(1)   the Company has deposited
with the Trustee or a Paying Agent (other than the Company or any of its
Affiliates) as trust funds in trust for the purpose of and in an amount
sufficient to pay and discharge all indebtedness related to such Securities not
theretofore delivered to the Trustee for cancellation, for principal and
interest to the date of such deposit (in the case of Securities which have
become due and payable) or to the Final Maturity Date, as the case may be;

 

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

 

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

 

65

 

(b)        Notwithstanding
the satisfaction and discharge of this Indenture, the obligations of the
Company with respect to the conversion privilege and the Conversion Rate of the
Securities pursuant to Article 5, the obligations of the Company to the
Trustee under Section 10.07 and, if money shall have been deposited with
the Trustee pursuant to clause (ii) of Section 11.01(a), the
provisions of Sections 2.03, 2.04, 2.05, 2.06, 2.07, 2.12, 7.01 and 13.05, Article 5,
and this Article 11, shall survive such satisfaction and discharge until
the Securities have been paid in full.

 

Section 11.02.  Application of Trust Money.  Subject to the provisions of Section 11.03,
the Trustee or a Paying Agent shall hold in trust, for the benefit of the
Holders, all money deposited with it pursuant to Section 11.01 and shall
apply the deposited money in accordance with this Indenture and the Securities
to the payment of the principal of and interest on the Securities.

 

Section 11.03.  Repayment to Company.

 

(a)        The
Trustee and each Paying Agent shall promptly pay to the Company upon request
any excess money (i) deposited with them pursuant to Section 11.01
and (ii) held by them at any time.

 

(b)        The
Trustee and each Paying Agent shall, subject to applicable abandonment property
laws, pay to the Company upon request any money held by them for the payment of
principal or interest that remains unclaimed for two years after a right to
such money has matured; provided, however,
that the Trustee or such Paying Agent, before being required to make any such
payment, may at the expense of the Company cause to be mailed to each Holder
entitled to such money notice that such money remains unclaimed and that after
a date specified therein, which shall be at least 30 days from the date of such
mailing, any unclaimed balance of such money then remaining will be repaid to
the Company.  After payment to the
Company, Holders entitled to money must look to the Company for payment as
general creditors unless an applicable abandoned property law designates
another person.

 

Section 11.04.  Reinstatement.  If the Trustee or any Paying Agent
is unable to apply any money in accordance with Section 11.02 by reason of
any legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company’s obligations under this Indenture and the
Securities shall be revived and reinstated as though no deposit had occurred
pursuant to Section 11.01 until such time as the Trustee or such Paying
Agent is permitted to apply all such money in accordance with Section 11.02;
provided, however, that if the Company
has made any payment of the principal of or interest on any Securities because
of the reinstatement of its obligations, the Company shall be subrogated to the
rights of the Holders of such Securities to receive any such payment from the
money held by the Trustee or such Paying Agent.

 

66

 

ARTICLE 12

AMENDMENTS; SUPPLEMENTS AND WAIVERS

 

Section 12.01.  Without Consent of Holders.

 

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

 

(i)    evidencing a successor to
the Company and the assumption by that successor of the Company’s obligations
under this Indenture and the Securities;

 

(ii)   adding to the Company’s
covenants for the benefit of the Holders or surrendering any right or power
conferred upon the Company;

 

(iii)  securing the Company’s
obligations in respect of the Securities;

 

(iv)  evidencing and providing for
the acceptance of the appointment of a successor trustee in accordance with Article 10;

 

(v)   complying with the
requirements of the SEC in order to maintain the qualification of this
Indenture under the TIA, as contemplated by this Indenture or otherwise;

 

(vi)  to conform the provisions of
this Indenture to the “Description of the Notes” section contained in the final
prospectus of the Company dated January 16, 2008;

 

(vii) curing any ambiguity,
omission, inconsistency or correcting or supplementing any defective provision
contained in this Indenture; or

 

(viii)                making any
other changes to the Indenture that do not adversely affect the rights of the
Holders in any material respect.

 

Section 12.02.  With Consent of Holders.

 

(a)        The
Company and the Trustee may amend or supplement this Indenture or the
Securities with the written consent of the Holders of at least a majority in
aggregate principal amount of the Securities then outstanding.  However, subject to Section 12.04,
without the written consent of each Holder affected, an amendment, supplement
or waiver may not:

 

(i)    alter the manner of
calculation or rate of accrual of interest on any Security or change the time
of payment of any installment of interest on, any Security;

 

(ii)   make any of the Securities
payable in money or securities other than that stated in the Securities;

 

(iii)  change the stated maturity
of any Security;

 

67

 

(iv)  reduce the principal amount
or Fundamental Change Repurchase Price (as applicable) with respect to any of
the Securities;

 

(v)   make any change that adversely
affects the rights of Holders to require the Company to purchase Securities at
the option of Holders;

 

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

 

(vii) change the currency of
payment of principal of, or interest on, the Securities;

 

(viii)                except as
otherwise permitted or contemplated by Section 5.10, adversely affect the
conversion rights (including any Make-Whole Premium) of the Securities; or

 

(ix)   change the percentage in
aggregate principal amount of Securities outstanding necessary to modify or
amend this Indenture or to waive any past Default.

 

(b)        Without
limiting the provisions of Section 12.02(a) hereof, the Holders of a
majority in aggregate principal amount of the Securities then outstanding may,
on behalf of all the Holders of all Securities, (i) waive compliance by
the Company with the restrictive provisions of this Indenture, and (ii) waive
any past Default or Event of Default under this Indenture and its consequences,
except an uncured failure to pay when due the principal amount, accrued and
unpaid interest or Fundamental Change Repurchase Price, or in the obligation to
deliver Common Stock, if any and as applicable, or in respect of any provision
which under this Indenture cannot be modified or amended without the consent of
the Holder of each outstanding Security affected.

 

(c)        After
an amendment, supplement or waiver under this Section 12.02 becomes
effective, the Company shall promptly mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver.  Any failure of the Company to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such amendment, supplement or waiver.

 

Section 12.03.  Compliance with Trust Indenture Act.  Every amendment to or supplement
of this Indenture or the Securities shall comply with the TIA as in effect at
the date of such amendment or supplement.

 

Section 12.04.  Revocation and Effect of Consents.

 

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

 

68

 

(b)        After
an amendment, supplement or waiver becomes effective, it shall bind every
Holder of a Security.

 

Section 12.05.  Notation on or Exchange of Securities.  If an amendment, supplement or
waiver changes the terms of a Security, the Trustee may require the Holder of
the Security to deliver it to the Trustee. 
The Trustee may place an appropriate notation on the Security about the
changed terms and return it to the Holder. 
Alternatively, if the Company or the Trustee so determines, the Company
in exchange for the Security shall issue and the Trustee shall authenticate a
new Security that reflects the changed terms.

 

Section 12.06.  Trustee to Sign Amendments, Etc.  The Trustee shall sign any
amendment or supplemental indenture authorized pursuant to this Article 12
if the amendment or supplemental indenture does not adversely affect the
rights, duties, liabilities or immunities of the Trustee.  If it does, the Trustee may, in its sole
discretion, but need not sign it.  In
signing or refusing to sign such amendment or supplemental indenture, the
Trustee shall be provided with and, subject to Section 10.01, shall be
fully protected in relying upon, an Opinion of Counsel and an Officers’
Certificate stating that such amendment or supplemental indenture is authorized
or permitted by this Indenture.  The
Company may not sign an amendment or supplemental indenture until the Board of
Directors approves it.

 

Section 12.07.  Effect of Supplemental Indentures.  Upon the execution of any
supplemental indenture under this Article 12, this Indenture shall be
modified in accordance therewith, and such supplemental indenture shall form a
part of this Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and delivered hereunder shall be bound
thereby.

 

ARTICLE 13

MISCELLANEOUS

 

Section 13.01.  Trust Indenture Act Controls.  If any provision of this Indenture
limits, qualifies or conflicts with the duties imposed by any of Sections 310
to 317, inclusive, of the TIA through operation of Section 318(c) thereof,
such imposed duties shall control.

 

Section 13.02.  Notices. 
Any demand, authorization notice, request, consent or
communication shall be given in writing and delivered in person or mailed by
first-class mail, postage prepaid, addressed as follows or transmitted by
facsimile transmission (confirmed by delivery in person or mail by first-class
mail, postage prepaid, or by guaranteed overnight courier) to the following
facsimile numbers:

 

69

 

If
to the Company, to:

 

Theravance, Inc.

901
Gateway  Boulevard

South
San Francisco, CA  94080

Attn:  General Counsel

Fax:  650-808-6095

 

with
a copy to:

 

Gunderson
Dettmer Stough Villeneuve Franklin & Hachigian LLP

155
Constitution Avenue

Menlo
Park, CA  94025

Attn:  David Young

Fax:  650-321-2800

 

and

 

Shearman &
Sterling LLP

525
Market Street

San
Francisco, CA  94105

Attn:  Mark Hyland

Fax:  415-616-1381

 

if
to the Trustee, to:

 

The
Bank of New York Trust Company, N.A.

700
South Flower Street

Suite 500

Los
Angeles, CA 90017

Attn:
Corporate Unit

Fax:
213-630-6298

 

Such
notices or communications shall be effective when received.

 

The
Company or the Trustee by notice to the other may designate additional or
different addresses for subsequent notices or communications.  Notice to or from the Trustee shall not be
via electronic mail.  Notices to the Trustee
via facsimile shall promptly be followed by the original written notice.

 

Any
notice or communication mailed to a Holder of a Security shall be mailed by
first-class mail or delivered by an overnight delivery service to it at its
address shown on the register kept by the Primary Registrar.

 

The
Trustee agrees to accept and act upon facsimile transmission of written
instructions and/or directions pursuant to this Indenture given by the Company,
provided, however that: (i) 

 

70

 

the Company, subsequent to such facsimile transmission of written
instructions and/or directions, shall provide the originally executed
instructions and/or directions to the Trustee in a timely manner and (ii) such
originally executed instructions and/or directions shall be signed by an
“Officer” of the Company

 

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

 

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

 

Section 13.03.  Communications by Holders with Other
Holders.  Holders of
Securities may communicate pursuant to TIA Section 312(b) with other
Holders of Securities with respect to their rights under this Indenture or the
Securities.  The Company, the Trustee,
the Registrar and any other person shall have the protection of TIA Section 312(c).

 

Section 13.04.  Certificate and Opinion as to Conditions
Precedent.

 

(a)        Upon
any request or application by the Company to the Trustee to take any action
under this Indenture, the Company shall furnish to the Trustee at the request
of the Trustee:

 

(i)    an Officers’ Certificate
stating that, in the opinion of the signers, all conditions precedent
(including any covenants, compliance with which constitutes a condition
precedent), if any, provided for in this Indenture relating to the proposed
action have been complied with; and

 

(ii)   an Opinion of Counsel
stating that, in the opinion of such counsel, all such conditions precedent (including
any covenants, compliance with which constitutes a condition precedent) have
been complied with.

 

(b)        Each
Officers’ Certificate and Opinion of Counsel with respect to compliance with a
condition or covenant provided for in this Indenture shall include:

 

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

 

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

 

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

 

71

 

(iv)  a statement as to whether or
not, in the opinion of such person, such condition or covenant has been
complied with;

 

provided, however, that with respect to matters of fact an
Opinion of Counsel may rely on an Officers’ Certificate or certificates of
public officials.

 

Section 13.05.  Record Date for Vote or Consent of Holders of
Securities.  The Company (or,
in the event deposits have been made pursuant to Section 11.01, the
Trustee) may set a record date for purposes of determining the identity of
Holders entitled to vote or consent to any action by vote or consent authorized
or permitted under this Indenture, which record date shall not be more than 30
days prior to the date of the commencement of solicitation of such action.  Notwithstanding the provisions of Section 12.04,
if a record date is fixed, those persons who were Holders of Securities at the
close of business on such record date (or their duly designated proxies), and
only those persons, shall be entitled to take such action by vote or consent or
to revoke any vote or consent previously given, whether or not such persons
continue to be Holders after such record date.

 

Section 13.06.  Rules by Trustee, Paying Agent,
Registrar and Conversion Agent.  The
Trustee may make reasonable rules (not inconsistent with the terms of this
Indenture) for action by or at a meeting of Holders.  Any Registrar, Paying Agent or Conversion
Agent may make reasonable rules for its functions.

 

Section 13.07.  Legal Holidays.  A “Legal Holiday” is a Saturday,
Sunday or a day on which state or federally chartered banking institutions in
New York, New York or Los Angeles, California are authorized or obligated to
close.  If a payment date is a Legal
Holiday, payment shall be made on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue for the intervening period.  If a Regular Record Date is a Legal Holiday,
the record date shall not be affected.

 

Section 13.08.  Governing Law.  This Indenture and the Securities
shall be governed by, and construed in accordance with, the laws of the State
of New York.

 

Section 13.09.  No Adverse Interpretation of Other
Agreements.  This Indenture
may not be used to interpret another indenture, loan or debt agreement of the
Company or a Subsidiary of the Company. 
Any such indenture, loan or debt agreement may not be used to interpret
this Indenture.

 

Section 13.10.  No Recourse Against Others.  All liability described in paragraph
17 of the Securities of any director, officer, employee or shareholder, as
such, of the Company hereby is waived and released by each of the Holders.

 

Section 13.11.  No Security Interest Created.  Nothing in this Indenture or in
the Securities, express or implied, shall be construed to constitute a security
interest under the Uniform Commercial Code or similar legislation, now in
effect or hereafter enacted and made effective, in any jurisdiction.

 

72

 

Section 13.12.  Successors. 
All agreements of the Company in this Indenture and the
Securities shall bind its successor.  All
agreements of the Trustee in this Indenture shall bind its successor.

 

Section 13.13.  Multiple Counterparts.  The parties may sign multiple
counterparts of this Indenture.  Each
signed counterpart shall be deemed an original, but all of them together
represent the same agreement.

 

Section 13.14.  Separability. 
If any provisions in this Indenture or in the Securities
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.

 

Section 13.15.  Table of Contents, Headings, Etc.  The table of contents,
cross-reference sheet and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not to be
considered a part hereof, and shall in no way modify or restrict any of the
terms or provisions hereof.

 

Section 13.16.  Waiver of Jury Trial.  EACH OF THE COMPANY AND THE
TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS INDENTURE, THE NOTES OR THE TRANSACTION CONTEMPLATED
HEREBY.

 

Section 13.17.  Force Majeure.  In no event shall the Trustee be
responsible or liable for any failure or delay in the performance of its
obligations hereunder arising out of or caused by, directly or indirectly,
forces beyond its control, including, without limitation, strikes, work
stoppages, accidents, acts of war or terrorism, civil or military disturbances,
nuclear or natural catastrophes or acts of God, and interruptions, loss or
malfunctions of utilities, communications or computer (software and hardware)
services; it being understood that the Trustee shall use reasonable efforts
which are consistent with accepted practices in the banking industry to resume
performance as soon as practicable under the circumstances.

 

[SIGNATURE PAGE FOLLOWS]

 

73

 

IN
WITNESS WHEREOF, the parties hereto have hereunto set their hands as of the
date and year first above written.

 

	
   

  	
  THERAVANCE, INC.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Rick E Winningham

  	
   

  
	
   

  	
   

  	
  Name: Rick E Winningham

  	
   

  
	
   

  	
   

  	
  Title: Chief Executive Officer

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  THE BANK OF NEW YORK TRUST
  COMPANY, N.A., as Trustee

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Melonee Young

  	
   

  
	
   

  	
   

  	
  Name: Melonee Young

  	
   

  
	
   

  	
   

  	
  Title: Vice President

  	
   

  

 

[SIGNATURE PAGE TO
INDENTURE]

 

S-1EXHIBIT
10.1

 

BIOJECT
MEDICAL TECHNOLOGIES INC.

SERIES F CONVERTIBLE PREFERRED STOCK

PURCHASE AGREEMENT

January 22, 2008

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
  Agreement To Sell And Purchase

  	
  1

  
	
   

  	
   

  	
   

  
	
   

  	
  1.1.

  	
  Authorization of Shares

  	
  1

  
	
   

  	
  1.2.

  	
  Sale and Purchase

  	
  1

  
	
   

  	
   

  	
   

  
	
  2.

  	
  Closings,
  Delivery And Payment

  	
  1

  
	
   

  	
   

  	
   

  
	
   

  	
  2.1.

  	
  Closing

  	
  1

  
	
   

  	
  2.2.

  	
  Delivery at Closing

  	
  1

  
	
   

  	
   

  	
   

  
	
  3.

  	
  Representations And
  Warranties Of The Company

  	
  2

  
	
   

  	
   

  	
   

  
	
   

  	
  3.1.

  	
  Organization and Qualification

  	
  2

  
	
   

  	
  3.2.

  	
  Subsidiaries

  	
  2

  
	
   

  	
  3.3.

  	
  Capitalization

  	
  2

  
	
   

  	
  3.4.

  	
  Authorization; Binding
  Obligations

  	
  3

  
	
   

  	
  3.5.

  	
  Exchange Act Filings; Listing

  	
  4

  
	
   

  	
  3.6.

  	
  Additional Information

  	
  4

  
	
   

  	
  3.7.

  	
  Financial Statements

  	
  4

  
	
   

  	
  3.8.

  	
  Liabilities

  	
  5

  
	
   

  	
  3.9.

  	
  Agreements; Action

  	
  5

  
	
   

  	
  3.10.

  	
  Obligations to Related Parties

  	
  5

  
	
   

  	
  3.11.

  	
  Changes

  	
  5

  
	
   

  	
  3.12.

  	
  Title to Properties and
  Assets; Liens, Etc

  	
  6

  
	
   

  	
  3.13.

  	
  Intellectual Property

  	
  7

  
	
   

  	
  3.14.

  	
  Compliance with Other Instruments

  	
  7

  
	
   

  	
  3.15.

  	
  Litigation

  	
  7

  
	
   

  	
  3.16.

  	
  Tax Returns and Payments

  	
  8

  
	
   

  	
  3.17.

  	
  Employees

  	
  8

  
	
   

  	
  3.18.

  	
  Employee Benefit Plans; ERISA

  	
  8

  
	
   

  	
  3.19.

  	
  Obligations of Management

  	
  9

  
	
   

  	
  3.20.

  	
  Voting Rights

  	
  9

  
	
   

  	
  3.21.

  	
  Compliance with Laws; Permits

  	
  9

  
	
   

  	
  3.22.

  	
  Environmental and Safety Laws

  	
  9

  
	
   

  	
  3.23.

  	
  Offering Valid

  	
  9

  
	
   

  	
  3.24.

  	
  Full Disclosure

  	
  9

  
	
   

  	
  3.25.

  	
  Insurance

  	
  10

  
	
   

  	
  3.26.

  	
  Internal Accounting Controls

  	
  10

  
	
   

  	
  3.27.

  	
  Investment Company

  	
  10

  
	
   

  	
  3.28.

  	
  Integration, Etc

  	
  10

  
	
   

  	
   

  	
   

  
	
  4.

  	
  Representations And
  Warranties Of The Purchasers

  	
  10

  
	
   

  	
   

  	
   

  
	
   

  	
  4.1.

  	
  Requisite Power and Authority

  	
  10

  
	
   

  	
  4.2.

  	
  Investment Representations

  	
  10

  
	
   

  	
  4.3.

  	
  Transfer Restrictions

  	
  12

  
	
   

  	
  4.4.

  	
  Short Sales

  	
  12

  
	
   

  	
   

  	
   

  
	
  5.

  	
  Covenants

  	
  12

  
	
   

  	
   

  	
   

  
	
   

  	
  5.1.

  	
  Corporate Existence

  	
  12

  
	
   

  	
  5.2.

  	
  Reservation of Common Stock

  	
  12

  
	
   

  	
  5.3.

  	
  Exchange Act Registration

  	
  12

  
	
   

  	
  5.4.

  	
  Listing of Common Stock

  	
  12

  
	
   

  	
  5.5.

  	
  Increase in Authorized Shares

  	
  12

  

 

i

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  6.

  	
  Conditions To Closing

  	
  13

  
	
   

  	
   

  	
   

  
	
   

  	
  6.1.

  	
  Conditions to Purchasers’
  Obligations at the Closing

  	
  13

  
	
   

  	
  6.2.

  	
  Conditions to Obligations of
  the Company at the Closing

  	
  14

  
	
   

  	
   

  	
   

  
	
  7.

  	
  Miscellaneous

  	
  14

  
	
   

  	
  7.1.

  	
  Governing Law

  	
  14

  
	
   

  	
  7.2.

  	
  Survival

  	
  14

  
	
   

  	
  7.3.

  	
  Attorneys’ Fees

  	
  14

  
	
   

  	
  7.4.

  	
  Successors and Assigns

  	
  14

  
	
   

  	
  7.5.

  	
  Entire Agreement

  	
  14

  
	
   

  	
  7.6.

  	
  Severability

  	
  14

  
	
   

  	
  7.7.

  	
  Amendment and Waiver

  	
  15

  
	
   

  	
  7.8.

  	
  Delays or Omissions

  	
  15

  
	
   

  	
  7.9.

  	
  Notices

  	
  15

  
	
   

  	
  7.10.

  	
  Titles and Subtitles

  	
  15

  
	
   

  	
  7.11.

  	
  Counterparts

  	
  15

  
	
   

  	
  7.12.

  	
  Broker’s Fees

  	
  15

  
	
   

  	
  7.13.

  	
  Public Announcements and
  Confidentiality

  	
  15

  
	
   

  	
  7.14.

  	
  Purchasers Business Activities

  	
  16

  
	
   

  	
  7.15.

  	
  Exculpation Among Purchasers

  	
  16

  
	
   

  	
  7.16.

  	
  Pronouns

  	
  16

  

 

	
  List of Exhibits:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Schedule of Exceptions

  	
   

  	
   

  
	
  Schedule of Purchasers

  	
   

  	
  Exhibit A

  
	
  Articles of Amendment

  	
   

  	
  Exhibit B

  
	
  Registration Rights Agreement

  	
   

  	
  Exhibit C

  
	
  Form of Legal Opinion

  	
   

  	
  Exhibit D

  

 

ii

 

BIOJECT
MEDICAL TECHNOLOGIES INC.

SERIES F CONVERTIBLE PREFERRED STOCK

PURCHASE AGREEMENT

 

This Purchase Agreement
(this “Agreement”) is made and entered into as of January 22, 2008, by and
among Bioject Medical Technologies Inc.,
an Oregon corporation (the “Company”), and the investors whose names and
addresses are set forth on the Schedule of Purchasers attached hereto as Exhibit A (individually, a “Purchaser”
and, collectively, the “Purchasers”).

 

RECITALS

 

The Company has authorized the sale and issuance of an
aggregate of 8,314 shares of its Series F Convertible Preferred Stock
pursuant to this Agreement (the “Shares”).

 

The Purchasers desire to purchase the Shares in
exchange for the cancellation of the outstanding principle amount of and
accrued interest through the date hereof on each Purchaser’s promissory note
issued by the Company (each a “Note” and together the “Notes”)
listed on Exhibit A hereto on
the terms and conditions set forth herein.

 

The Company desires to issue and sell the Shares to
the Purchasers on the terms and conditions set forth herein.

 

AGREEMENT

 

In consideration of the foregoing recitals and the
mutual promises, representations, warranties and covenants hereinafter set
forth and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, intending to be legally bound
hereby, the parties hereto agree as follows:

 

1.                                      AGREEMENT
TO SELL AND PURCHASE.

 

1.1.         Authorization of Shares.  On or prior to the Closing (as hereinafter
defined), the Company shall have authorized (a) the sale and issuance to
the Purchasers of the Shares and (b) the issuance of such shares of common
stock, no par value, of the Company (“Common Stock”) to be issued upon
conversion of the Shares (the “Conversion Shares”).  The Shares shall have the rights,
preferences, privileges and restrictions set forth in the Articles of Amendment
to the Company’s 2002 Restated Articles of Incorporation, in the form attached
hereto as Exhibit B (the “Articles
of Amendment”).

 

1.2.         Sale and Purchase.  Subject to the terms and conditions hereof,
at the Closing the Company hereby agrees to issue and sell to each Purchaser,
severally and not jointly, and each Purchaser agrees to purchase from the Company,
severally and not jointly, the number of Shares set forth opposite each
Purchaser’s name on Exhibit A
at a price of $75.00 per share payable by cancellation of the outstanding
principle amount of and accrued interest on each Purchaser’s Note through the
date hereof.

 

2.                                      CLOSINGS,
DELIVERY AND PAYMENT.

 

2.1.         Closing.   The closing of the sale and purchase of the
Shares under this Agreement (the “Closing”) shall take place at
10:00 a.m. on January 22, 2008, at the offices of the Company in
Tualatin, Oregon, or at such other time or place as the Company and the
Purchasers may mutually agree (such date is hereinafter referred to as the “Closing
Date”).

 

2.2.         Delivery at Closing.  At
the Closing, subject to the terms and conditions hereof, the Company will deliver
to each Purchaser one or more certificates registered in the name of the
Purchaser, or in such nominee name(s) as designated by each Purchaser in
writing, representing the number of Shares to be purchased at the Closing by
such Purchaser. The name(s) in which certificates are to be registered are
as set forth on Exhibit A.
The Company’s obligation to complete the purchase and sale of the Shares being
purchased hereunder and deliver such certificates to the Purchasers at the
Closing shall be subject to the following conditions: (a) receipt by the 

 

 

Company of the original Notes for cancellation and
(b) the accuracy in all material respects of the representations and
warranties made by the Purchasers and the fulfillment of those undertakings of
the Purchasers to be fulfilled prior to or at the Closing.  The Purchasers’ obligation to accept delivery
of such certificates and to deliver the Notes for cancellation shall be subject
to the accuracy in all material respects of the representations and warranties
made by the Company herein and the fulfillment of those undertakings of the
Company to be fulfilled prior to or at the Closing.

 

3.                                      REPRESENTATIONS
AND WARRANTIES OF THE COMPANY.

 

Except as set forth on a Schedule of Exceptions
delivered by the Company to the Purchasers at the Closing (the “Schedule of
Exceptions”) specifically identifying the relevant Section or Sections
hereof and except as disclosed in the Company’s publicly available filings made
with the Securities and Exchange Commission, the Company hereby represents and
warrants to each Purchaser as of the date of this Agreement as set forth below.

 

3.1.         Organization and Qualification.  The Company is a corporation duly organized
and validly existing under the laws of the State of Oregon.  The Company has all requisite corporate power
and authority to own and operate its properties and assets, to execute and
deliver the Articles of Amendment, this Agreement, the Registration Rights
Agreement in the form attached hereto as Exhibit C
(the “Registration Rights Agreement”),  and any other agreements contemplated
hereby (collectively, the “Transaction Documents”), to issue and sell
the Shares and the Conversion Shares, and to carry out the provisions of the
Transactions Documents and to carry on its business as presently
conducted.  The Company is duly qualified
and is authorized to do business and is in good standing as a foreign
corporation in all jurisdictions in which the nature of its activities and of
its properties (both owned and leased) makes such qualification necessary,
except for those jurisdictions in which failure to do so would not have a
Material Adverse Effect (as hereinafter defined).

 

3.2.         Subsidiaries.  The
Company does not own or control any equity security or other interest of any other
corporation, limited partnership or other business entity other than
Bioject, Inc. and Marathon Medical Technologies, Inc.  The Company is not a participant in any joint
venture, partnership, or similar arrangement.

 

Each of the Company’s subsidiaries has been duly
organized and is validly existing in good standing under the laws of the
jurisdiction of its incorporation, has corporate power and authority to own,
lease and operate its properties and to conduct its business as conducted and
as proposed to be conducted, and is duly qualified and is in good standing as a
foreign corporation in each jurisdiction in which such qualification is
required, except where the failure to be so qualified will not have a Material
Adverse Effect.  All of the issued and outstanding
capital stock of each such subsidiary has been duly authorized and validly
issued, is duly paid and nonassessable and is owned by the Company free and
clear of any security interest, mortgage, pledge, lien, encumbrance, claim or
equity; and none of the outstanding shares of capital stock of each such
subsidiary was issued in violation of any preemptive or similar rights of any
third party.

 

3.3.         Capitalization.

 

(a)           The authorized
capital stock of the Company, immediately prior to the Closing, consists of
(i) 100,000,000 shares of common stock, no par value per share (“Common
Stock”), 15,321,121 shares of which are issued and outstanding and
(ii) 10,000,000 shares of preferred stock, no par value per share (“Preferred
Stock”), (A) 1,235,000 shares of which are designated Series A
Preferred Stock (the “Series A Preferred”), of which no shares are
issued and outstanding, (B) 200,000 shares of which are designated
Series B Preferred Stock (the “Series B Preferred”), of which
no shares are issued and outstanding, (C) 500,000 shares of which are
designated Series C Preferred Stock (the “Series C Preferred”),
of which no shares are issued and outstanding, (D) 2,086,957 shares of
which are designated Series D Preferred Stock (the “Series D
Preferred”), all of which are outstanding, (E) 4,000,000 shares which
are designated Series E Preferred Stock (the “Series E Preferred”),
3,308,394 of which are issued and outstanding, (F) 9,644 shares of
which are designated Series F Preferred Stock (the “Series F Preferred”),
of which no shares are issued and outstanding, and (G) 12,500 shares
of which are designated Series R Participating Preferred Stock (the “Series R
Preferred”), of which no shares are issued and outstanding.

 

(b)           (i) No shares
have been issued pursuant to restricted stock purchase agreements, the
restrictions under which have not expired, (ii) options and restricted
stock units to acquire 1,855,305 shares of 

 

2

 

Common Stock have been granted or are currently
outstanding, (iii) the Company has reserved 513,598 shares of Common Stock
for future issuance to officers, directors, employees and consultants of the
Company, including at the discretion of the Company’s Board of Directors, as
part of a stock incentive option plan.

 

(c)           Other than
(i) as set forth in Section 3.3 of the Schedule of Exceptions,
(ii) the shares reserved for issuance under Section 3.3(b)(iii),
and (iii) except as may be granted pursuant to this Agreement and the
Registration Rights Agreement, there are no outstanding options, warrants,
rights (including conversion or preemptive rights and rights of first refusal,
whether in favor of the Company or any other person), proxy or stockholder
agreements, or agreements of any kind for the purchase or acquisition from the
Company of any of its securities.

 

(d)           All issued and
outstanding shares of the Common Stock and Preferred Stock (i) have been
duly authorized and validly issued, are fully paid and nonassessable,
(ii) were issued in compliance with all applicable state and federal laws
concerning the issuance of securities, and (iii) were not issued in
violation or subject to any preemptive rights or other rights to subscribe for
or purchase securities.

 

(e)           The rights,
preferences, privileges, and restrictions of the Shares are as stated in the
Articles of Amendment.  The Conversion
Shares have been duly and validly reserved for issuance. When issued in
compliance with the provisions of this Agreement and the Articles of Amendment,
as the case may be, the Shares and the Conversion Shares will be validly
issued, fully paid and nonassessable, and, except as provided in the
Registration Rights Agreement, will be free of any liens or encumbrances; provided, however, that the Shares and the
Conversion Shares may be subject to restrictions on transfer under state and/or
federal securities laws as set forth herein or as otherwise required by such
laws at the time a transfer is proposed.

 

(f)            No stock plan,
stock purchase, stock option, or other agreement or understanding between the
Company and any holder of any equity securities or rights to purchase equity
securities provides for acceleration or other changes in the vesting provisions
or other terms of such agreement or understanding as the result of
(i) termination of employment (whether actual or constructive); or
(ii) the occurrence of any other event or combination of events.

 

(g)           The sale of the
Shares and the subsequent conversion of the Shares into Conversion Shares are
not and will not be subject to any preemptive rights or rights of first refusal
that have not been properly waived or complied with.

 

(h)           No further approval
or authority of the stockholders or the Board of Directors of the Company will
be required for the issuance and sale of the Shares to be sold by the Company
as contemplated herein or for the issuance and delivery of the Conversion
Shares.

 

3.4.         Authorization; Binding Obligations.  All corporate action on the part of the
Company, its officers, directors, and stockholders necessary for the
authorization of this Agreement and the other the Transaction Documents, the
performance of all obligations of the Company hereunder and thereunder at the
Closing and the authorization, sale, issuance, and delivery of the Shares
pursuant hereto and the Conversion Shares pursuant to the Articles of
Amendment, as the case may be, has been taken or will be taken prior to the
Closing.

 

The execution, delivery and performance of the
Transaction Documents by the Company and the consummation by the Company of the
transactions therein contemplated will not result in the creation of any lien,
charge, security interest or encumbrance upon any assets of the Company
pursuant to the terms or provisions of, or conflict with, result in the breach
or violation of, or constitute, either by itself or upon notice or the passage
of time or both, a default under any material agreement, mortgage, deed of
trust, lease, franchise, license, indenture, permit or other instrument to
which the Company is a party or by which the Company or any of its properties
may be bound or affected and in each case which individually or in the
aggregate would have a material adverse effect on the condition (financial or
otherwise), properties, business, or results of operations of the Company and
its subsidiaries, taken as a whole (a “Material Adverse Effect”), or any
statute or any authorization, judgment, decree, order, rule or regulation
of any court or any regulatory body, administrative agency or other
governmental body applicable to the Company or any of its respective
properties.  No consent, approval,
authorization or other order of, or filing with, any court, regulatory body,
administrative agency, or other governmental body is required for the execution
and 

 

3

 

delivery of the Transaction Documents or the
consummation of the transactions contemplated by the Transaction Documents,
except for (a) the filing of the Articles of Incorporation, which will be
filed on the Closing Date, (b) filings pursuant to Regulation D of the
Securities Act, and applicable state securities laws, which have been made or
will be made in a timely manner, and (c) the filing of the required notice
to the NASDAQ Capital Market.

 

The Transaction Documents when executed and delivered,
will be valid and binding obligations of the Company enforceable in accordance
with their terms, except (a) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws of general application affecting
enforcement of creditors’ rights, (b) as limited by general principles of
equity that restrict the availability of equitable remedies, and (c) to
the extent that the enforceability of the indemnification provisions in
Section 9 of the Registration Rights Agreement may be limited by
applicable laws.

 

3.5.         Exchange Act Filings; Listing.  During the twelve (12) calendar months
immediately preceding the date of this Agreement, all reports and statements
required to be filed by the Company with the Securities and Exchange Commission
(“SEC”) under the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), and the rules and regulations thereunder, have been timely
filed. Such filings, together with all documents incorporated by reference
therein, are referred to as “Exchange Act Documents.” The Company’s
Common Stock is quoted on the NASDAQ Capital Market.

 

3.6.         Additional Information. 
A true and complete copy of each report, schedule, registration
statement, and definitive proxy statement filed by the Company with the SEC
under the Exchange Act during the twelve (12) months preceding the Closing Date
(as such documents have since the time of their filing been amended, the “Information
Documents”), which are all the documents (other than preliminary material)
that the Company was required to file with the SEC since such date, has been
made available to the Purchasers.  As of
their respective dates, the Information Documents and any forms, reports and
other documents filed by the Company during the period commencing on the date
of this Agreement and ending on the last date on which the Company is required
to maintain the effectiveness of the registration statement referred to in the
Registration Rights Agreement (the “Registration Statement”), complied
or will comply in all material respects with the requirements of the Securities
Act of 1933 (the “Securities Act”) or the Exchange Act, as the case may
be, and the rules and regulations of the Commission thereunder applicable
to the Information Documents or such other forms, reports or other documents,
and none of the Information Documents contained, or will contain at the time
they are filed, any untrue statement of a material fact or omitted, or will
omit at the time they are filed, to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.

 

3.7.         Financial Statements.  The Company has made available to the
Purchaser its (or to the extent applicable, those of any predecessor in
interest) (a) The audited financial statements, together with the related
notes of the Company at December 31, 2006 and December 31, 2005, and
for the years then ended included in the Company’s Annual Report on
Form 10-K for the year ended December 31, 2006 (the “2006
Statements”), and (b) the unaudited financial statements of the
Company at September 30, 2007 (the “Statement Date”), and for the
nine months then ended, (the “Year to Date Statements” and together with
the 2006 Statements, “Financial Statements”) included in the Company’s
Quarterly Report on Form 10-Q for the quarter ended September 30,
2007.  The Financial Statements
(a) represent actual bona fide transactions, (b) have been prepared from
the books and records of the Company in conformity with generally accepted
accounting principles applied on a consistent basis throughout the periods
indicated, except as disclosed therein or in the Schedule of Exceptions, and
(c) fairly present, on the basis stated therein and on the date thereof,
the financial condition and position of the Company as of December 31,
2006, and the Statement Date and its results of operations and cash flows for
the periods then ended; provided, however,
that the Year-to-Date Statements are subject to normal recurring year-end
adjustments (which are not expected to be material either individually or in
the aggregate), and omit all footnotes required under generally accepted
accounting principles.

 

The books of account and other records of the Company
are complete and correct and have been maintained in accordance with sound
business practices, including the maintenance of an adequate system of internal
controls.

 

4

 

3.8.         Liabilities.  The Company has no material liabilities and,
to the best of its knowledge, knows of no material contingent liabilities, in
each case except as disclosed in the Financial Statements or in Forms 8-K filed
since September 30, 2007 and except for current liabilities incurred in
the ordinary course of business subsequent to the Statement Date that are not
material, either in any individual case or in the aggregate.

 

3.9.         Agreements;
Action.

 

(a)           Except for the
Registration Rights Agreement, the Registration Rights Agreement dated
November 15, 2004 between the Company and certain investors, the
Securities Purchase Agreement dated March 8, 2006 between the Company and
certain investors, or other contracts or agreements referred to or contemplated
herein or therein, there are no material agreements, understandings or proposed
transactions between the Company and any of its officers, directors, affiliates
or any affiliate thereof.

 

(b)           Since the Statement
Date, the Company has not (i) declared or paid any dividends, or
authorized or made any distribution upon or with respect to any class or series
of its capital stock, (ii) except for $500,000 borrowed from Edward Flynn,
$508,896 borrowed from Life Sciences Opportunities Fund II (Institutional)
L.P., $91,104 borrowed from Life Science Opportunities Fund II, L.P., and an
aggregate of $115,000 borrowed from Ralph Makar, David Tierney, Richard Stout
and Christine Farrell, incurred any indebtedness for money borrowed or any
other liabilities (other than with respect to dividend obligations, distributions,
indebtedness and other obligations incurred in the ordinary course of business
or as disclosed in the Financial Statements) individually in excess of $50,000
or, in the case of indebtedness and/or liabilities individually less than
$50,000, in excess of $200,000 in the aggregate, (iii) made any loans or
advances to any person, other than ordinary advances for travel expenses, or
(iv) sold, exchanged or otherwise disposed of any of its assets or rights,
other than the sale of its inventory in the ordinary course of business.  For the purposes of this subsection, all
indebtedness, liabilities, agreements, understandings, instruments, contracts
and proposed transactions involving the same person or entity (including
persons or entities the Company has reason to believe are affiliated therewith)
shall be aggregated for the purpose of meeting the individual minimum dollar
amounts of such subsections.

 

(c)           Other than as
described in the Schedule of Exceptions, the Company is not under any binding
obligation to any third party (other than obligations to keep information or
discussions confidential) as a result of any discussion or negotiation
undertaken in the past twelve months relating to (i) the consolidation or
merger of the Company with or into any such corporation or corporations,
(ii) the sale, conveyance, or disposition of all or substantially all of
the assets of the Company, or a transaction or series of related transactions
in which more than 50% of the voting power of the Company is disposed of, or
(iii)  any other form of acquisition, liquidation, dissolution, or winding
up, of the Company.

 

3.10.       Obligations to Related Parties.  Except as set forth on the Schedule of
Exceptions, there are no obligations of the Company to officers, directors or
employees of the Company other than (a) for payment of salary for services
rendered, (b) reimbursement for reasonable expenses incurred on behalf of
the Company, (c) for other standard employee benefits made generally
available to all employees (including stock option agreements and restricted
stock unit agreements outstanding under any stock option plan approved by the
Board of Directors of the Company), (d) relocation and stock award
obligations to the Chief Executive Officer pursuant to his employment
agreement, and (e) obligations for indemnification under the Company’s
organizational documents and applicable law. 
Except as set forth on the Schedule of Exceptions, none of the officers,
directors or key employees of the Company, or any members of their immediate
families, are indebted to the Company or, to the Company’s knowledge, have any
direct or, to the best of the Company’s knowledge, indirect ownership interest
in any firm or corporation with which the Company is affiliated or with which
the Company has a business relationship, or any firm or corporation which
competes with the Company, other than passive investments in publicly traded
companies (representing less than 1% of such company) which may compete with
the Company.  No officer or director, or
any member of their immediate families, is, directly or, to the best of the
Company’s knowledge, indirectly, interested in any contract with the Company
(other than such contracts as relate to any such person’s ownership of capital
stock or other securities of the Company). 
Except as may be disclosed in the Financial Statements, the Company is
not a guarantor or indemnitor of any indebtedness of any other person, firm or
corporation, other than Bioject, Inc.

 

3.11.       Changes.  Since the Statement Date and except as
disclosed on any Form 8-K filed since September 30, 2007, there has
not been:

 

5

 

(a)           Any change in the
assets, liabilities, financial condition,  or
operations of the Company from that reflected in the Financial Statements,
other than changes in the ordinary course of business, none of which
individually or in the aggregate has had or is reasonably expected to have a
Material Adverse Effect;

 

(b)           Any resignation or
termination of any officer, key employee or group of employees of the Company;
and the Company, to the best of its knowledge, does not know of the impending
resignation or termination of employment of any such officer, key employee or
group of employees;

 

(c)           Any material
change, except in the ordinary course of business, in the contingent
obligations of the Company by way of guaranty, endorsement, indemnity, warranty
or otherwise;

 

(d)           Any damage,
destruction or loss, whether or not covered by insurance, which is reasonably
expected to have a Material Adverse Effect;

 

(e)           Any waiver by the
Company of a valuable right or of a material debt owed to it;

 

(f)            Any direct or
indirect loans made by the Company to any employee, officer or director of the
Company, other than advances made in the ordinary course of business;

 

(g)           Any material change
in any compensation arrangement or agreement with any employee, officer or
director;

 

(h)           To the knowledge of
the Company, any labor organization activity related to the Company;

 

(i)            Any debt, obligation
or liability incurred, assumed or guaranteed by the Company, except those for
immaterial amounts and for current liabilities incurred in the ordinary course
of business;

 

(j)            Any sale,
assignment or transfer of any patents, trademarks, copyrights, trade secrets or
other intangible assets, other than the granting of licenses to strategic
partners in the ordinary course of the Company’s business;

 

(k)           Any change in any
material agreement to which the Company is a party or by which it is bound
which is reasonably expected to have a Material Adverse Effect;

 

(l)            Any other event or
condition of any character that, either individually or cumulatively, has or is
reasonably expected to have a Material Adverse Effect; or

 

(m)          Any arrangement or
commitment by the Company to do any of the acts described in subsection
(a) through (l) above.

 

3.12.       Title to Properties and Assets; Liens,
Etc.  The Company has
good and marketable title to its material tangible properties and assets,
including the tangible properties and assets reflected in the most recent
balance sheet included in the Financial Statements, and good title to its
leasehold estates, in each case subject to no mortgage, pledge, lien, lease,
encumbrance or charge, other than (a) those resulting from taxes which
have not yet become delinquent, (b) minor liens and encumbrances which do
not materially detract from the value of the property subject thereto or
materially impair the operations of the Company, and (c) those that have
otherwise arisen in the ordinary course of business.  All material facilities, machinery,
equipment, fixtures, vehicles and other tangible assets owned, leased or used
by the Company are in good operating condition and repair and are reasonably
fit and usable for the purposes for which they are being used.  The Company is in compliance with all
material terms of each lease to which it is a party or is otherwise bound.

 

6

 

3.13.       Intellectual
Property

 

(a)           Set forth in the
Schedule of Exceptions is a true and complete list of all patents, patent
applications, trademarks, service marks, trademark and service mark
applications, trade names, copyright registrations and licenses presently used
by the Company (with the exception of licenses and rights in “off the shelf”
software publications and sold as such). To the Company’s best knowledge, the
Company has full title and ownership of, or is duly licensed or otherwise
authorized to use, all patents, trademarks, service marks, trade names,
copyrights, trade secrets, licenses, know-how, information and other
proprietary rights and processes and formulae, and applications for patents,
trademarks, service marks, and copyrights (collectively, “Intellectual
Property Rights”) necessary for its business as now conducted or as
presently proposed to be conducted, without any infringement of the rights of
others.  There are no outstanding
options, licenses, or agreements of any kind relating to any of the
Intellectual Property Rights that are owned by the Company, or to the Company’s
knowledge, relating to rights that are licensed to the Company by other
parties.  The Company is not bound by nor
is it a party to any options, licenses or agreements of any kind with respect
to the Intellectual Property Rights of any other person or entity other than
such licenses or agreements arising from the purchase of “off the shelf”
software or standard products, and other than licenses granted by sponsors of
the Company in order to enable the Company to perform its production services
for such sponsors.

 

(b)           Neither the Company
nor any of its subsidiaries is in default of its obligations to pay royalties
or other amounts to other persons by reason of the ownership or use of any
Intellectual Property Rights used by the Company and its subsidiaries for the
conduct of their respective businesses.

 

(c)           To the best of the
Company’s knowledge, no Intellectual Property Right owned by the Company or any
of its subsidiaries violates or will violate any license or infringes or will
infringe any Intellectual Property Rights of another.  To the best of the Company’s knowledge, no
Intellectual Property Right, product or service marketed, sold or licensed (as
licensor or as licensee) by the Company or any of its subsidiaries, violates or
will violate any license or infringes or will infringe any Intellectual
Property Rights of another, nor has the Company or any of its subsidiaries
received any notice that any of the Intellectual Property Rights used by the
Company or any of its subsidiaries for the conduct of their respective
businesses, conflicts or will conflict with the rights of others.

 

(d)           There are no claims
pending or, to the best of the Company’s knowledge, threatened with respect to
any Intellectual Property Rights necessary or required for the conduct of the
business of the Company or any of its subsidiaries as currently conducted, nor,
to the best of the Company’s knowledge, does there exist any basis therefor.

 

3.14.       Compliance with Other Instruments.  The Company is not in violation or default of
any provision of its articles of incorporation or bylaws. The Company and to
the best of the Company’s knowledge, each other party thereto, is not in breach
of or default with respect to any provision of any mortgage, indenture,
contract, agreement, instrument, contract, decree, order, lease, franchise,
license, permit, or other instrument to which it is party or by which it or any
of its properties are bound; and there does not exist any state of facts which,
with notice or lapse of time or both, would constitute an event of default as
defined in such documents on the part of the Company, except for such breaches
and defaults which individually or in the aggregate would not have a Material
Adverse Effect. The execution, delivery, and performance of and compliance with
this Agreement, the Articles of Amendment, and the Registration Rights
Agreement, and the issuance and sale of the Shares pursuant hereto, and of the
Conversion Shares pursuant to the Articles of Amendment, will not, with or without
the passage of time or giving of notice or both, result in any such material
violation, or be in conflict with or constitute a material default under any
such term or provision, or result in the creation of any mortgage, pledge,
lien, encumbrance or charge upon any of the properties or assets of the Company
or the suspension, revocation, impairment, forfeiture or nonrenewal of any
permit, license, authorization or approval applicable to the Company, its
business or operations or any of its assets or properties.  The Company has avoided every condition, and
has not performed any act, the occurrence of which would result in the
Company’s loss of any right granted under any license, distribution agreement,
or other agreement required to be disclosed on the Schedule of Exceptions.

 

3.15.       Litigation.   There is
no action, suit, proceeding, or investigation pending or, to the Company’s
knowledge, currently threatened against the Company that questions the validity
of this Agreement, the 

 

7

 

Articles of Amendment, or the Registration Rights
Agreement or the right of the Company to enter into any of such agreements, or
to consummate the transactions contemplated hereby or thereby, or which might  result, either individually or in the
aggregate, in any Material Adverse Effect, nor is the Company aware that there
is any basis for any of the foregoing. The foregoing includes, without
limitation, actions pending or, to the Company’s knowledge, threatened or any
basis therefor known by the Company involving the prior employment of any of
the Company’s employees, their use in connection with the Company’s business of
any information or techniques allegedly proprietary to any of their former
employers, or their obligations under any agreements with prior employers.  The Company is not a party or subject to the
provisions of any order, writ, injunction, judgment or decree of any court or
government agency or instrumentality. 
There is no action, suit, proceeding or investigation by the Company
currently pending or which the Company intends to initiate.

 

3.16.       Tax Returns and Payments.
 The Company has timely filed all material tax
returns (federal, state, and local) required to be filed by it.  All taxes shown to be due and payable on such
returns and to the Company’s knowledge all other material taxes due and payable
by the Company on or before the Closing, have been paid or will be paid prior
to the time they become delinquent.  The Company has not been notified
in writing (a) that any of its federal, state, or local tax returns have
been or are being audited as of the date hereof, or (b) of any proposed
deficiency in or adjustment to its federal, state or local taxes.  The Company has no knowledge of any liability
for any material tax to be imposed upon its properties or assets as of the date
of this Agreement that is not adequately provided for. The Company has withheld
and paid all taxes required to be withheld and paid in connection with amounts
paid or owing to any employee, creditor, shareholder, or other third party.
There are no agreements, waivers, or other arrangements providing for an
extension of time with respect to the assessment of any taxes or deficiency
against the Company. To the Company’s knowledge, there is no pending or
threatened investigation of the Company by any federal, state, foreign, or
local authority relating to any taxes or assessments, or any claims for
additional taxes or assessments asserted by any such authority.

 

3.17.       Employees.  The Company
has no collective bargaining agreements with any of its employees.  There is no labor union organizing activity
pending or, to the Company’s knowledge, threatened with respect to the Company.
To the Company’s knowledge, no employee of the Company, nor any consultant with
whom the Company has contracted, is in material violation of any term of any
employment contract, proprietary information agreement, or any other agreement
relating to the right of any such individual to be employed by, or to contract
with, the Company because of the nature of the business to be conducted by the
Company; and to the Company’s knowledge the continued employment by the Company
of its present employees, and the performance of the Company’s contracts with
its independent contractors, will not result in any such material
violation.  The Company has not received
any written notice alleging that any such material violation has occurred.  No employee of the Company has been granted
the right to continued employment by the Company or to any material
compensation following termination of employment with the Company (other than
to Ralph Makar, Richard Stout and Christine Farrell pursuant to their
respective employment agreements).  The
Company is not aware that any officer, key employee, or group of employees
intends to terminate his, her, or their employment with the Company, nor does
the Company have a present intention to terminate the employment of any
officer, key employee, or group of employees. The Company is not aware of any
claims, actions, proceedings, or threats relating to sexual harassment,
wrongful termination, discrimination, or any other employment matter. To the
Company’s knowledge there is no fact or circumstance that is reasonably
expected to, with the passage of time or otherwise, cause this representation
to be no longer true and correct. To the Company’s knowledge, the Company is in
compliance in all material respects with all provisions of the Fair Labor
Standards Act, all applicable state wage and hour laws, and all applicable
workers’ compensation laws.

 

3.18.       Employee Benefit Plans; ERISA.  All pension, retirement, bonus, profit
sharing, stock option, employee, and other benefit or welfare plans or
arrangements maintained by the Company, or to which the Company contributes or
is required to contribute, to the extent required, materially comply with the
provisions of and have been administered and maintained in material compliance
with the provisions of the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”) and all other applicable laws.  The Company is not a party to or bound by any
currently effective employment contract, deferred compensation arrangement,
bonus plan, incentive plan, profit sharing plan, retirement agreement, or other
employee compensation plan or agreement, including, but not limited to, any
“employee pension benefit plan” as defined in Section 3 of ERISA. All
unpaid liabilities of the Company with respect to, and all unfunded benefits
(whether vested or not) under, each employee welfare benefit plan as defined in
Section 3(1) of ERISA maintained by the Company have been calculated
and are reflected in the 

 

8

 

Company’s financial statement in accordance with
generally accepted accounting principles, and any such liabilities incurred
after the date of such financial statements will be incurred in the ordinary
course of business, determined in a manner substantially similar to that used
in such financial statements.

 

3.19.       Obligations of Management.
 Each officer and key employee of the Company
is currently devoting substantially all of his or her business time to the
conduct of the business of the Company. 
The Company is not aware that any officer or key employee of the Company
is planning to work less than full time at the Company in the future.  No officer or key employee is currently
working or, to the Company’s knowledge, plans to work for a competing
enterprise, whether or not such officer or key employee is or will be
compensated by such enterprise.

 

3.20.       Voting Rights.  To the Company’s knowledge, no stockholder of
the Company has entered into any agreement with respect to the voting of equity
securities of the Company.

 

3.21.       Compliance with Laws; Permits. 
The Company is not in violation of any applicable statute, rule,
regulation, order or restriction of any domestic or foreign government or any
instrumentality or agency thereof in respect of the conduct of its business or
the ownership of its properties which violation would have a Material Adverse
Effect.  No governmental orders,
permissions, consents, approvals, or authorizations are required to be obtained
and no registrations or declarations are required to be filed in connection
with the execution and delivery of this Agreement and the issuance of the
Shares and the Conversion Shares, except such as has been duly and validly
obtained or filed, or with respect to any filings that must be made after the
Closing (including the filing of relevant notices under applicable state law and
a Form D pursuant to the Securities Act), as will be filed in a timely
manner.  The Company has all franchises,
permits, licenses, and any similar authority necessary for the conduct of its
business as now being conducted by it, the lack of which could have a Material
Adverse Effect and believes it can obtain, without undue burden or expense, any
similar authority for the conduct of its business as planned to be conducted.

 

3.22.       Environmental and Safety Laws.  The Company is not in violation in any material
respect of any applicable statute, law or regulation relating to the
environment or occupational health and safety, and to its knowledge, no
material expenditures are or will be required in order to comply with any such
existing statute, law, or regulation. Hazardous Materials (as defined below)
are used or have been used, stored, or disposed of by the Company in material
compliance with all applicable statutes, laws and regulations. Except as set
forth on the Schedule of Exceptions, the Company has not, and to the Company’s
knowledge, no other person has caused any release, threatened release, or
disposal of any Hazardous Material on any property owned, leased, or used by
the Company. For the purposes of the preceding sentences, “Hazardous
Material” means any substance, chemical, compound, product, solid,
gas, liquid, waste, byproduct, pollutant, compound, or material that is listed
or otherwise regulated as “hazardous” or “toxic” under any applicable local,
state and federal laws and regulations that govern the existence and/or remedy
of contamination on property, the protection of the environment from
contamination, the control of hazardous wastes, or other activities involving
medical waste, biological waste, or hazardous substances (“Applicable
Environmental Law”), and includes asbestos, polychlorinated biphenyls
(PCBs), petroleum products, or nuclear materials.  To the Company’s knowledge, the Company has
no material liability for response or corrective action, natural resource
damage, or other harm pursuant to Applicable Environmental Law.

 

3.23.       Offering Valid.  Assuming the accuracy of the representations
and warranties of each Purchaser contained in Section 4.2 hereof,
the offer, sale, and issuance of the Shares and the Conversion Shares will be
exempt from the registration requirements of the Securities Act, and will have
been registered or qualified (or are exempt from registration and
qualification) under the registration, permit, or qualification requirements of
all applicable state securities laws. 
Neither the Company nor any agent on its behalf has solicited or will
solicit any offers to sell or has offered to sell or will offer to sell all or
any part of the Shares to any person or persons so as to bring the sale of such
Shares by the Company within the registration provisions of the Securities Act
or any state securities laws.

 

3.24.       Full Disclosure.  None of this Agreement, the Registration
Rights Agreement, the Articles of Amendment, nor any other certificate
delivered by the Company to the Purchaser in connection herewith or therewith
or with the transactions contemplated hereby or thereby, contains any untrue
statement of a material 

 

9

 

fact nor omits to state a material fact necessary in
order to make the statements contained herein or therein not misleading in
light of the circumstances in which such statements were made.

 

3.25.       Insurance.  The
Company has general commercial, product liability, fire and casualty insurance
policies and, to the best of its knowledge, such policies provide coverage
customary for companies similarly situated to the Company.

 

3.26.       Internal Accounting Controls. 
The Company has established disclosure controls and procedures (as
defined in Exchange Act rules 13a-15 and 15d-15) for the Company and
designed such disclosure controls and procedures to ensure that material
information relating to the Company is made known to the certifying officers by
others within those entities, particularly during the period in which the
Company’s Form 10-K or 10-Q, as the case may be, is being prepared.  The Company’s certifying officers have
evaluated the effectiveness of the Company’s controls and procedures as of a
date within 90 days prior to the filing date of the Form 10-Q for the
Company’s most recently ended fiscal quarter (such date, the “Evaluation
Date”).  The Company presented in its
most recently filed Form 10-K or Form 10-Q the conclusions of the
certifying officers about the effectiveness of the disclosure controls and procedures
based on their evaluations as of the Evaluation Date.  Since the Evaluation Date, there have been no
significant changes in the Company’s internal control over financial reporting
(as such term is defined in Exchange Act rules 13a-15(f) and 15d-15(f))
or, to the Company’s knowledge, in other factors that could significantly
affect the Company’s internal controls.

 

3.27.       Investment Company. 
The Company is not regulated or required to be registered as an
“investment company” within the meaning of the Investment Company Act of 1940,
as amended.

 

3.28.       Integration, Etc.  The
Company has not in the past nor will it hereafter take any action to sell,
offer for sale or solicit offers to buy any securities of the Company which
would bring the offer, issuance or sale of the Shares, as contemplated by this
Agreement, within the provisions of Section 5 of the Securities Act.  Neither the Company nor any of its Affiliates
(as defined in Rule 501(b) of Regulation D under the Securities Act)
has directly, or through any agent, (i) sold, offered for sale, solicited
offers to buy or otherwise negotiated in respect of, any “security” (as defined
in the Securities Act) which is or could be integrated with the sale of the
Shares in a manner that would require the registration under the Securities Act
of the Shares or (ii) engaged in any form of general solicitation or
general advertising (as those terms are used in Regulation D under the
Securities Act) in connection with the offering of the Shares or in any manner
involving a public offering within the meaning of Section 4(2) of the
Securities Act.

 

4.                                      REPRESENTATIONS
AND WARRANTIES OF THE PURCHASERS.

 

Each Purchaser hereby represents and warrants to the
Company as follows:

 

4.1.         Requisite Power and Authority.   Such Purchaser that is not a natural person is
an entity duly organized, validly existing and in good standing under the laws
of its state of formation.  Such
Purchaser has all necessary power and authority to execute and deliver this
Agreement and the Registration Rights Agreement and to carry out their
provisions.  All action on such
Purchaser’s part required for the lawful execution and delivery of this
Agreement and the Registration Rights Agreement has been or will be effectively
taken prior to the Closing.  Upon their
execution and delivery, this Agreement and the Registration Rights Agreement to
which it is a party will be valid and binding obligations of such Purchaser,
enforceable in accordance with their terms, except (a) as limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other laws of
general application affecting enforcement of creditors’ rights, (b) as
limited by general principles of equity that restrict the availability of
equitable remedies, and (c) to the extent that the enforceability of the
indemnification provisions of Section 9 of the Registration Rights
Agreement may be limited by applicable laws.

 

4.2.         Investment Representations. 
Such Purchaser understands that none of the Shares or the Conversion
Shares has been registered under the Securities Act.  Such Purchaser also understands that the
Shares are being offered and sold pursuant to an exemption from registration
contained in the Securities Act based in part upon Purchaser’s representations
contained in the Agreement.  Purchaser
hereby represents and warrants as follows:

 

10

 

(a)           Purchaser Bears Economic Risk.  Such Purchaser has substantial experience in
evaluating and investing in private placement transactions of securities in
companies similar to the Company so that it is capable of evaluating the merits
and risks of its investment in the Company and has the capacity to protect its
own interests.  Such Purchaser must bear
the economic risk of this investment indefinitely unless the Shares (or the
Conversion Shares) are registered pursuant to the Securities Act, or an
exemption from registration is available. 
Such Purchaser has requested, received, reviewed, and understood all
information it deems relevant in making an informed decision to purchase the
Shares, including without limitation, the information contained in the
Information Documents.

 

(b)           Acquisition for Own Account.  Such Purchaser is acquiring the Shares and
the Conversion Shares for such Purchaser’s own account for investment only, and
not with a view towards their distribution.

 

(c)           Purchaser Can Protect Its Interest.  Such Purchaser represents that by reason of
its, or of its management’s, business or financial experience or relationship
with the Company, such Purchaser has the capacity to protect its own interests
in connection with the transactions contemplated in this Agreement and the
Registration Rights Agreement.

 

(d)           Accredited Purchaser.  Such purchaser acknowledges that the offering
of the Shares pursuant to this Agreement has not been reviewed by the SEC or
any state regulatory authority. Such Purchaser represents that it is an
“accredited investor” within the meaning of Regulation D under the Securities
Act. Such Purchaser has also had the opportunity to ask questions of and
receive answers from, the Company and its management regarding the terms and
conditions of this investment.

 

(e)           Rule 144.  Such Purchaser acknowledges and agrees that
the Shares, and, if issued, the Conversion Shares must be held indefinitely
unless they are subsequently registered under the Securities Act or an
exemption from such registration is available, and such securities will bear a
restrictive legend similar to the following:

 

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) OR ANY STATE
SECURITIES LAWS.  THEY MAY NOT BE
SOLD, ASSIGNED, PLEDGED OR OTHERWISE TRANSFERRED FOR VALUE UNLESS THEY ARE
REGISTERED UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR THE
CORPORATION RECEIVES AN OPINION OF COUNSEL SATISFACTORY TO IT, OR OTHERWISE
SATISFIES ITSELF, THAT REGISTRATION IS NOT REQUIRED.”

 

Such Purchaser has been advised or is aware of the
provisions of Rule 144 promulgated under the Securities Act as in effect
from time to time, which permits limited resale of shares purchased in a
private placement subject to the satisfaction of certain conditions, including,
among other things: the availability of certain current public information
about the Company, the resale occurring following the required holding period
under Rule 144 and the number of shares being sold during any three-month
period not exceeding specified limitations.

 

(f)            Residence.  If the Purchaser is an individual, then the
Purchaser resides in the state or province identified in the address of the
Purchaser set forth on Exhibit A;
if the Purchaser is a partnership, corporation, limited liability company or
other entity, then the principal place of business of the Purchaser, or if not the
principal place of business, the office or offices in which its investment
decision was made, is located at the address or addresses of the Purchaser set
forth on Exhibit A.

 

(g)           No General Solicitation.  The Purchaser has not received any general
solicitation or general advertising (including any advertisement, article,
notice or other communication published in any newspaper, magazine or similar
media or broadcast over television or radio, or any seminar or meeting whose
attendees have been invited by any general solicitation or general advertising)
concerning the Company or the Shares, nor is the Purchaser aware that any such
solicitation or advertising was received by anyone else.

 

11

 

(h)           Receipt of Information.  Such Purchaser has met with officers of the
Company, has had an opportunity to ask questions and receive answers concerning
the business, properties, and financial condition of the Company and the terms
and conditions of an investment in the Company, and has received all
information (including projections about the Company) that such Purchaser
believes is necessary or desirable in connection with an investment in the
Company.  Such Purchaser understands that
any projections that it has received are based on numerous important
assumptions and that some or all of such assumptions will likely prove to be
incorrect and, accordingly, the actual results of the Company will vary from
the projections and such variations may be material.  Such Purchaser has been solely responsible
for its own due diligence investigation of the Company and its business, for
analysis of the merits and risks of the investment made pursuant to this
Agreement and for analysis of the terms of the investment.

 

4.3.         Transfer Restrictions.   Each Purchaser acknowledges and agrees that
the Shares and, if issued, the Conversion Shares are subject to restrictions on
transfer as set forth in the Registration Rights Agreement.

 

4.4.         Short Sales.  Each
Purchaser agrees not to sell short any shares of Common Stock or engage in
other hedging transactions with respect to the Common Stock so long as such
Purchaser owns any Shares or Conversion Shares and each Purchaser further
agrees that it shall not permit its affiliates to engage in any of the
foregoing activities.

 

5.                                      COVENANTS.

 

5.1.         Corporate Existence. 
The Company will take all steps necessary to preserve and continue the
corporate existence of the Company.

 

5.2.         Reservation of Common Stock. 
As of the date hereof, the Company has authorized and reserved and the
Company shall continue to reserve and keep available, free of preemptive
rights, shares of Common Stock for the purpose of enabling the Company to issue
the Conversion Shares.  The number of
shares so reserved shall be increased or decreased to reflect adjustments in
the number of Conversion Shares issuable upon conversion of the Shares.

 

5.3.         Exchange Act Registration. 
The Company will maintain the registration of its Common Stock under
Section 12 of the Exchange Act, will comply in all respects with its
reporting and filing obligations under the Exchange Act, and will not take any
action or file any document (whether or not permitted by the Exchange Act or
the rules thereunder) to terminate or suspend such registration or to terminate
or suspend its reporting and filing obligations under said Act, until the date
which is two years from the Closing Date.

 

5.4.         Listing of Common Stock. 
The Company shall prepare and file with the NASDAQ Capital Market an
additional shares listing application covering a reasonable estimate of the
Conversion Shares issuable upon conversion of the Shares.  In addition, if at any time the number of
Conversion Shares issuable upon conversion of the Shares is greater than the
number of shares of Common Stock theretofore listed on the NASDAQ Capital
Market, the Company shall promptly take such action to file an additional
shares listing application covering such additional number of shares of Common
Stock.

 

5.5.         Increase in Authorized Shares. 
As such time as the Company would be, if all outstanding Shares were immediately
converted, precluded from honoring the conversion of the Shares in full due to
the unavailability of a sufficient number of shares of authorized but unissued
Common Stock, the Board of Directors of the Company shall promptly (an in any
case within 90 days from such date) hold a stockholders meeting in which the
stockholders would vote to amend the Company’s Articles of Incorporation to
increase the number of shares of Common Stock which the Company is authorized
to issue to at least a number of shares equal to the sum of (i) all shares
of Common Stock then outstanding, (ii) the number of shares of Common
Stock issuable on account of all outstanding warrants, options, and convertible
securities (other than the Shares) and on account of all shares reserved under
any stock option, stock purchase, or similar plan, and (iii) such number
of Conversion Shares as would then be issuable upon conversion of all
outstanding Shares.

 

12

 

6.                                      CONDITIONS
TO CLOSING.

 

6.1.         Conditions to Purchasers’ Obligations
at the Closing.  The Purchasers’ obligations to purchase the
Shares at the Closing are subject to the satisfaction, at or prior to the
Closing Date, of the following conditions:

 

(a)           Representations and Warranties True;
Performance of Obligations. 
The representations and warranties made by the Company in Section 3
hereof shall be true and correct in all material respects as of the Closing
Date with the same force and effect as if they had been made as of the Closing
Date, and the Company shall have performed in all material respects, all
obligations and conditions herein required to be performed or observed by it on
or prior to the Closing.

 

(b)           Legal Investment.  On the Closing Date, the
sale and issuance of the Shares and the proposed issuance of the Conversion
Shares shall be legally permitted by all laws and regulations to which the
Purchasers and the Company are subject.

 

(c)           Consents, Permits, and Waivers.  The Company shall have obtained any and all
consents, permits and waivers necessary or appropriate for consummation of the
transactions contemplated by this Agreement and the Registration Rights
Agreement (except for such as may be properly obtained subsequent to the
Closing).

 

(d)           Articles of Amendment of
Series F Convertible Preferred Stock.  The Articles of Amendment shall have been
filed with the Secretary of State of the State of Oregon and shall continue to
be in full force and effect as of the Closing Date.

 

(e)           Corporate Documents.  The Company shall have delivered to the
Purchasers or their counsel copies of all corporate documents of the Company as
the Purchasers shall reasonably request.

 

(f)            Reservation of Conversion Shares.  The Conversion Shares issuable upon
conversion of the Shares shall have been duly authorized and reserved for
issuance upon such conversion.

 

(g)           Compliance Certificate.  The Company shall have delivered to the
Purchasers a Compliance Certificate, executed by the President of the Company,
dated the Closing Date, to the effect that the conditions specified in
subsections (a) through (f) of this Section 6.1 have been
satisfied.

 

(h)           Secretary’s Certificate.
The Purchasers shall have received from the Company’s Secretary, a certificate
having attached thereto (i) the Company’s Restated Articles of
Incorporation as in effect at the time of the Closing, which Restated Articles
of Incorporation shall include the Articles of Amendment, (ii) the
Company’s bylaws as in effect at the time of the Closing, (iii) the
resolutions approved by the Board of Directors of the Company authorizing the
transactions contemplated hereby, and (iv) good standing certificates with
respect to the Company from the applicable authority(ies) in Oregon and any
other jurisdiction in which the Company is qualified to do business, dated a
recent date before the Closing.

 

(i)            Registration Rights Agreement.  The Registration Rights Agreement
substantially in the form attached hereto as
Exhibit C shall have been executed and delivered by the parties
thereto.

 

(j)            Legal Opinion.  The Purchasers shall have
received from Stoel Rives LLP, legal counsel to the Company, an opinion
addressed to them, dated as of the Closing Date, in substantially the form
attached hereto as Exhibit D.

 

(k)           Proceedings and Documents.  All corporate and other proceedings in
connection with the transactions contemplated at the Closing hereby and all
documents and instruments incident to such transactions shall be reasonably
satisfactory in substance and form to the Purchasers and their counsel, and the
Purchasers and their counsel shall have received all such counterpart originals
or certified or other copies of such documents as they may reasonably request.

 

13

 

6.2.         Conditions to Obligations of the
Company at the Closing.  The Company’s obligation to issue and sell
the Shares is subject to the satisfaction, on or prior to the Closing, of the
following conditions:

 

(a)           Representations and Warranties True.  The representations and warranties in Section 4
made by the Purchasers shall be true and correct in all material respects at
the date of the Closing, with the same force and effect as if they had been
made on and as of said date.

 

(b)           Performance of Obligations.  The Purchasers shall have performed and
complied with all agreements and conditions herein required to be performed or
complied with by Purchasers on or before the Closing.

 

(c)           Registration Rights Agreement.
The Registration Rights Agreement substantially in the form attached hereto as Exhibit C shall have been executed and
delivered by the Purchasers.

 

(d)           Consents, Permits, and Waivers.  The Company shall have obtained any and all
consents, permits and waivers necessary or appropriate for consummation of the
transactions contemplated by the Agreement and the Registration Rights
Agreement.

 

7.                                      MISCELLANEOUS.

 

7.1.         Governing Law.  This Agreement shall be governed in all
respects by the laws of the State of Oregon, without reference to principles of
conflict of laws.

 

7.2.         Survival.  The representations, warranties, covenants,
and agreements made herein shall survive any investigation made by the
Purchasers and the closing of the transactions contemplated hereby for a period
of two years following the Closing Date. All statements as to factual matters
contained in any certificate or other instrument delivered by or on behalf of
the Company pursuant hereto in connection with the transactions contemplated
hereby shall be deemed to be representations and warranties by the Company
hereunder solely as of the date of such certificate or instrument.

 

7.3.         Attorneys’ Fees.  In the
event that any suit or action is instituted to enforce any provision in this
Agreement, the prevailing party in such dispute shall be entitled to recover
from the losing party all fees, costs and expenses of enforcing any right of
such prevailing party under or with respect to this Agreement, including
without limitation, such reasonable fees and expenses of attorneys and accountants,
which shall include, without limitation, all fees, costs and expenses of
appeals.

 

7.4.         Successors and Assigns.  Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors and administrators of the
parties hereto and shall inure to the benefit of and be enforceable by each
person who shall be a holder of the Shares from time to time.

 

7.5.         Entire Agreement.  This Agreement, the exhibits and schedules
hereto, the Registration Rights Agreement and the other documents delivered
pursuant hereto, all of even date herewith between the parties hereto,
constitute the full and entire understanding and agreement between the parties
with regard to the subjects hereof and no party shall be liable or bound to any
other in any manner by any representations, warranties, covenants and
agreements except as specifically set forth herein and therein.

 

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

 

14

 

7.7.         Amendment
and Waiver.

 

(a)           This Agreement may
be amended or modified only upon the written consent of the Company and holders
of at least a majority of the Shares (treated as if converted and including any
Conversion Shares into which the Shares have been converted that have not been
sold to the public).

 

(b)           The obligations of
the Company and the rights of the holders of the Shares and the Conversion
Shares under this Agreement may be waived only with the written consent of the
holders of at least a majority of the Shares (treated as if converted and
including any Conversion Shares into which the Shares have been converted that
have not been sold to the public). The rights of the Company under this
Agreement may be waived only by the prior written consent of the Company.

 

7.8.         Delays or Omissions.  It is agreed that no delay or omission to
exercise any right, power or remedy accruing to any party, upon any breach,
default or noncompliance by another party under this Agreement, the
Registration Rights Agreement or the Articles of Amendment, shall impair any
such right, power or remedy, nor shall it be construed to be a waiver of any
such breach, default or noncompliance, or any acquiescence therein, or of or in
any similar breach, default or noncompliance thereafter occurring.  It is further agreed that any waiver, permit,
consent or approval of any kind or character on the Purchasers’ part of any
breach, default or noncompliance under this Agreement, the Registration Rights
Agreement or under the Articles of Amendment or any waiver on such party’s part
of any provisions or conditions of this Agreement, the Registration Rights
Agreement or the Articles of Amendment must be in writing and shall be
effective only to the extent specifically set forth in such writing.  All remedies, either under this Agreement,
the Registration Rights Agreement, the Articles of Amendment, by law, or
otherwise afforded to any party, shall be cumulative and not alternative;
provided, however, that Purchaser may not recover monetary damages under more
than one remedy for any give breach, default or non-compliance.

 

7.9.         Notices.  All notices required or permitted hereunder
shall be in writing and shall be deemed effectively given: (a) upon
personal delivery to the party to be notified, (b) when sent by confirmed
electronic mail or facsimile if sent during normal business hours of the
recipient, if not, then on the next business day, (c) five days after
having been sent by registered or certified mail, return receipt requested,
postage prepaid, or (d) one day after deposit with a nationally recognized
overnight courier, specifying next day delivery, with written verification of
receipt.  All communications shall be
sent to the Company at the address as set forth on the signature page hereof
and to the Purchasers at the addresses set forth on Exhibit A attached hereto or at such other address as the
Company or the Purchasers may designate by ten days advance written notice to
the other parties hereto.

 

7.10.       Titles and Subtitles. 
The titles of the sections and subsections of the Agreement are for
convenience of reference only and are not to be considered in construing this
Agreement.

 

7.11.       Counterparts.  This Agreement may be executed in any number
of counterparts (including by facsimile), each of which shall be an original,
but all of which together shall constitute one instrument.

 

7.12.       Broker’s Fees.  Each party hereto represents and warrants
that no agent, broker, investment banker, person or firm acting on behalf of or
under the authority of such party hereto is or will be entitled to any broker’s
or finder’s fee or any other commission directly or indirectly in connection
with the transactions contemplated herein. 
Each party hereto further agrees to indemnify each other party for any
claims, losses or expenses incurred by such other party as a result of the
representation in this Section 7.13 being untrue.

 

7.13.       Public
Announcements and Confidentiality.

 

(a)           Any public
announcement, press release, or similar publicity with respect to this
Agreement or the Registration Rights Agreement will be issued, if at all, at
such time and in such manner as the Purchasers and the Company mutually
determine. Except with the prior consent of the Purchasers or as permitted by
this Agreement, neither the Company, its shareholders, nor any of their
representatives shall disclose to any person (a) the fact that any
confidential information of the Company has been disclosed to the Purchasers or
their representatives, that the Purchasers or their representatives have
inspected any confidential information of the Company, that any confidential
information of the Company has been disclosed to the Purchasers or (b) any

 

15

 

information about the this Agreement and the
Registration Rights Agreement, including the status of such discussions or
negotiations, the execution of any documents (including this Agreement) or any
of the terms of this Agreement or the Registration Rights Agreement.  The Company shall not use the names of any of
the Purchasers in any manner, context or format (including, but not limited to,
websites or links to websites, press releases, dealing with the Company’s
customers, suppliers, and employees) without the prior review and express
written consent of the Purchasers. 
Notwithstanding anything in this section to the contrary, the Company
may make any disclosures with respect to this Agreement and the transactions
contemplated hereby as are required by law or the rules of the NASDAQ
Capital Market without consent of the Purchasers.

 

(b)           Each party hereto
agrees that, except with the prior written consent of the other party, it shall
at all times keep confidential and not divulge, furnish or make accessible to
anyone any confidential information, knowledge or data concerning or relating
to the business or financial affairs of the other parties to which such party
has been or shall become privy by reason of this Agreement or the Registration
Rights Agreement, discussions or negotiations relating to this Agreement or the
Registration Rights Agreement, the performance of its obligations hereunder or
the ownership of the Shares purchased hereunder.  The provisions of this Section 7.13
shall be in addition to, and not in substitution for, the provisions of any
separate nondisclosure agreement executed by the parties hereto.  Notwithstanding any other express or implied
agreement or understanding to the contrary, the parties hereto and their
respective employees, representatives, and other agents are authorized to
disclose the tax treatment and tax structure of the transactions contemplated
by this Agreement to any and all persons, without limitation of any kind.  The recipient and each other party may
disclose all materials of any kind (including opinions or other tax analyses)
to the extent (but only to the extent) that they relate to the tax treatment or
tax structure of the transactions contemplated by this Agreement.  This authorization is not intended to permit
disclosure of any other information including (without limitation) (a) any
portion of any materials to the extent not related to the tax treatment or the
tax structure of the transactions, (b) the identities of participants or
potential participants in the transactions, (c) the existence or status of
any negotiations, (d) any pricing information, (e) any financial,
actuarial or insurance underwriting information relating to the parties hereto,
or (f) any other term or detail not related to the tax treatment or tax
structure of the transactions.

 

7.14.       Purchasers Business Activities.  The Company and each Purchaser hereby
acknowledge that some of the Purchasers may be professional investment funds
and, therefore, invest in numerous portfolio companies, some of which may be in
direct or indirect competition with the Company.  No Purchaser shall be liable to the Company
or to any other Purchaser for any claim arising out of, or based upon,
(i) the investment by any Purchaser in any entity competitive with the
Company, or (ii) actions taken by a partner, officer, or representative of
any Purchaser that may assist such competitive entity, whether or not such
action was taken as a board member, officer, investor in such company or
otherwise, and whether or not such action has a detrimental effect on the
Company (unless such action involves a breach of Section 7.13(b)).

 

7.15.       Exculpation Among Purchasers. 
Each Purchaser acknowledges that it is not relying upon any person,
firm, or corporation, other than the Company and its officers and directors, in
making its investment or decision to invest in the Company.  Each Purchaser agrees that no Purchaser nor
the respective controlling persons, officers, directors, partners, agents, or
employees of any Purchaser shall be liable to any other Purchaser for any
action heretofore or hereafter taken or omitted to be taken by any of them in
connection with the Shares and Conversion Shares.

 

7.16.       Pronouns.  All pronouns contained
herein, and any variations thereof, shall be deemed to refer to the masculine,
feminine or neutral, singular or plural, as to the identity of the parties
hereto may require.

 

[Signature
Pages Follow]

 

16

 

In Witness Whereof, the
parties hereto have executed the Purchase
Agreement as of the date set forth in the first paragraph hereof.

 

	
  COMPANY:

  
	
   

  
	
  BIOJECT MEDICAL.

  TECHNOLOGIES INC.

  
	
   

  
	
   

  
	
  By:

  	
  /s/Ralph Makar

  	
   

  
	
  Name:

  	
  Ralph Makar 

  	
   

  
	
  Title:

  	
  President and Chief Executive Officer

  	
   

  
	
   

  	
   

  
	
  20245 S.W. 95th Avenue

  Tualatin, Oregon 97062

  
	
   

  	 

	
  INVESTORS:

  	 

	
   

  	 

	
   

  	 

	
  /s/Edward L. Flynn

  	
   

  	 

	
  Edward L. Flynn

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
  /s/Ralph Makar

  	
   

  	 

	
  Ralph Makar

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
  /s/David Tierney

  	
   

  	 

	
  David Tierney

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
  /s/Richard Stout

  	
   

  	 

	
  Richard Stout

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
  /s/Christine Farrell

  	
   

  	 

	
  Christine Farrell

  	
   

  	 

							

 

Signature Page to

Series F Convertible
Preferred Stock Purchase Agreement

 

 

Exhibit A

 

SCHEDULE
OF PURCHASERS

 

	
  Name and Address

  	
   

  	
  Shares

  	
   

  	
  Principal

  Amount

  of Note

  	
   

  	
  Accrued

  Interest thru

  1/22/08

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Edward L. Flynn

  20245 S.W. 95th Ave.

  Tualatin, OR 97062

  	
   

  	
  6,760

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  7,000

  	
   

  
	
  Ralph
  Makar

  20245 S.W. 95th
  Ave.

  Tualatin, OR
  97062

  	
   

  	
  676

  	
   

  	
  $

  	
  50,000

  	
   

  	
  $

  	
  700

  	
   

  
	
  David
  Tierney

  20245 S.W. 95th
  Ave.

  Tualatin, OR
  97062

  	
   

  	
  676

  	
   

  	
  $

  	
  50,000

  	
   

  	
  $

  	
  700

  	
   

  
	
  Richard
  Stout

  20245 S.W. 95th
  Ave.

  Tualatin, OR
  97062

  	
   

  	
  101

  	
   

  	
  $

  	
  7,500

  	
   

  	
  $

  	
  75

  	
   

  
	
  Christine
  Farrell

  20245 S.W. 95th
  Ave.

  Tualatin, OR
  97062

  	
   

  	
  101

  	
   

  	
  $

  	
  7,500

  	
   

  	
  $

  	
  75

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL

  	
   

  	
  8,314

  	
   

  	
  $

  	
  615,000

  	
   

  	
  $

  	
  8,550

  	
   

  

 

A-1

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