Document:

exv4w8

 

Exhibit 4.8

EXECUTION COPY

FINISAR CORPORATION

21/2% Convertible Senior Subordinated Notes

due 2010

 

INDENTURE

Dated as of October 12, 2006

U.S. BANK TRUST NATIONAL ASSOCIATION,

TRUSTEE

 

 

 

Table of Contents

	 	 	 	 	 
	 	 	Page
	ARTICLE 1

DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
	 	 	 	 
	SECTION 1.01 Definitions
	 	 	1	 
	SECTION 1.02 Other Definitions
	 	 	12	 
	SECTION 1.03 Incorporation by Reference of Trust Indenture Act
	 	 	13	 
	SECTION 1.04 Rules of Construction
	 	 	13	 
	SECTION 1.05 Acts of Holders
	 	 	13	 
	ARTICLE 2

THE NOTES
	 	 	 	 
	 
	 	 	 	 
	SECTION 2.01 Form and Dating
	 	 	14	 
	SECTION 2.02 Execution and Authentication
	 	 	16	 
	SECTION 2.03 Registrar, Paying Agent and Conversion Agent
	 	 	17	 
	SECTION 2.04 Paying Agent to Hold Money and Notes in Trust
	 	 	17	 
	SECTION 2.05 Noteholder Lists
	 	 	17	 
	SECTION 2.06 Transfer and Exchange
	 	 	18	 
	SECTION 2.07 Replacement Notes
	 	 	19	 
	SECTION 2.08 Outstanding Notes; Determinations of Holders’ Action
	 	 	20	 
	SECTION 2.09 Temporary Notes
	 	 	20	 
	SECTION 2.10 Cancellation
	 	 	21	 
	SECTION 2.11 Persons Deemed Owners
	 	 	21	 
	SECTION 2.12 Global Notes
	 	 	21	 
	SECTION 2.13 CUSIP Numbers
	 	 	26	 
	SECTION 2.14 Defaulted Interest
	 	 	26	 
	SECTION 2.15 Registration Default
	 	 	26	 
	ARTICLE 3

REDEMPTION AND REPURCHASES
	 	 	 	 
	 
	 	 	 	 
	SECTION 3.01 Provisional Redemption
	 	 	27	 
	SECTION 3.02 Notice of Trustee
	 	 	27	 
	SECTION 3.03 Selection of Notes to be Redeemed
	 	 	27	 
	SECTION 3.04 Notice of Redemption
	 	 	28	 
	SECTION 3.05 Effect of Notice of Redemption
	 	 	28	 
	SECTION 3.06 Deposit of Provisional Redemption Price
	 	 	29	 
	SECTION 3.07 Notes Redeemed in Part
	 	 	29	 
	SECTION 3.08 Conversion Arrangement on Call for Redemption
	 	 	29	 
	SECTION 3.09 Reserved
	 	 	30	 
	SECTION 3.10 Repurchase of Notes at Option of the Holder upon Change in Control
	 	 	30	 
	SECTION 3.11 Effect of Change in Control Repurchase Notice
	 	 	37	 

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Table of Contents
(continued)

	 	 	 	 	 
	 	 	Page
	SECTION 3.12 Deposit of Change in Control Repurchase Price
	 	 	38	 
	SECTION 3.13 Notes Repurchased in Part
	 	 	38	 
	SECTION 3.14 Covenant to Comply with Securities Laws upon Purchase or Repurchase of Notes
	 	 	38	 
	SECTION 3.15 Repayment to the Company
	 	 	39	 
	ARTICLE 4

COVENANTS
	 	 	 	 
	 
	 	 	 	 
	SECTION 4.01 Payment of Principal and Interest on the Notes
	 	 	39	 
	SECTION 4.02 Commission and Other Reports
	 	 	39	 
	SECTION 4.03 Compliance Certificate
	 	 	40	 
	SECTION 4.04 Further Instruments and Acts
	 	 	40	 
	SECTION 4.05 Maintenance of Office or Agency
	 	 	40	 
	SECTION 4.06 Delivery of Certain Information
	 	 	40	 
	ARTICLE 5

SUCCESSOR CORPORATION
	 	 	 	 
	 
	 	 	 	 
	SECTION 5.01 When Company May Merge or Transfer Assets
	 	 	41	 
	ARTICLE 6

DEFAULTS AND REMEDIES
	 	 	 	 
	 
	 	 	 	 
	SECTION 6.01 Events of Default
	 	 	42	 
	SECTION 6.02 Acceleration
	 	 	43	 
	SECTION 6.03 Other Remedies
	 	 	44	 
	SECTION 6.04 Waiver of Past Defaults
	 	 	44	 
	SECTION 6.05 Control by Majority
	 	 	44	 
	SECTION 6.06 Limitation on Suits
	 	 	45	 
	SECTION 6.07 Rights of Holders to Receive Payment
	 	 	45	 
	SECTION 6.08 Collection Suit by Trustee
	 	 	45	 
	SECTION 6.09 Trustee May File Proofs of Claim
	 	 	45	 
	SECTION 6.10 Priorities
	 	 	46	 
	SECTION 6.11 Undertaking for Costs
	 	 	46	 
	SECTION 6.12 Waiver of Stay, Extension or Usury Laws
	 	 	47	 
	ARTICLE 7

TRUSTEE
	 	 	 	 
	 
	 	 	 	 
	SECTION 7.01 Duties and Responsibilities of the Trustee; During Default; Prior to Default
	 	 	47	 
	SECTION 7.02 Certain Rights of the Trustee
	 	 	48	 

ii

 

Table of Contents
(continued)

	 	 	 	 	 
	 	 	Page
	SECTION 7.03 Trustee Not Responsible for Recitals, Disposition of Notes or Application of Proceeds Thereof
	 	 	49	 
	SECTION 7.04 Trustee and Agents May Hold Notes; Collections, etc
	 	 	49	 
	SECTION 7.05 Moneys Held by Trustee
	 	 	49	 
	SECTION 7.06 Compensation and Indemnification of Trustee and Its Prior Claim
	 	 	50	 
	SECTION 7.07 Right of Trustee to Rely on Officers’ Certificate, etc
	 	 	50	 
	SECTION 7.08 Conflicting Interests
	 	 	50	 
	SECTION 7.09 Persons Eligible for Appointment as Trustee
	 	 	50	 
	SECTION 7.10 Resignation and Removal; Appointment of Successor Trustee
	 	 	51	 
	SECTION 7.11 Acceptance of Appointment by Successor Trustee
	 	 	52	 
	SECTION 7.12 Merger, Conversion, Consolidation or Succession to Business
of Trustee
	 	 	52	 
	SECTION 7.13 Preferential Collection of Claims Against the Company
	 	 	53	 
	SECTION 7.14 Reports by the Trustee
	 	 	53	 
	SECTION 7.15 Trustee to Give Notice of Default, But May Withhold in Certain Circumstances
	 	 	53	 
	ARTICLE 8
 DISCHARGE OF INDENTURE
	 	 	 	 
	 
	 	 	 	 
	SECTION 8.01 Discharge of Liability on Notes
	 	 	53	 
	SECTION 8.02 Repayment of the Company
	 	 	54	 
	ARTICLE 9

AMENDMENTS
	 	 	 	 
	 
	 	 	 	 
	SECTION 9.01 Without Consent of Holders
	 	 	54	 
	SECTION 9.02 With Consent of Holders
	 	 	55	 
	SECTION 9.03 Compliance with Trust Indenture Act
	 	 	56	 
	SECTION 9.04 Revocation and Effect of Consents, Waivers and Actions
	 	 	56	 
	SECTION 9.05 Notation on or Exchange of Notes
	 	 	56	 
	SECTION 9.06 Trustee to Sign Supplemental Indentures
	 	 	56	 
	SECTION 9.07 Effect of Supplemental Indentures
	 	 	56	 
	ARTICLE 10

CONVERSION
	 	 	 	 
	 
	 	 	 	 
	SECTION 10.01 Conversion Right and Conversion Price
	 	 	56	 
	SECTION 10.02 Exercise of Conversion Right
	 	 	60	 
	SECTION 10.03 Fractions of Shares
	 	 	61	 
	SECTION 10.04 Adjustment of Conversion Price
	 	 	61	 
	SECTION 10.05 Notice of Adjustments of Conversion Price
	 	 	69	 
	SECTION 10.06 Notice Prior to Certain Actions
	 	 	70	 
	SECTION 10.07 Company to Reserve Common Stock
	 	 	71	 

iii

 

Table of Contents
(continued)

	 	 	 	 	 
	 	 	Page
	SECTION 10.08 Taxes on Conversions
	 	 	71	 
	SECTION 10.09 Covenant as to Common Stock
	 	 	71	 
	SECTION 10.10 Cancellation of Converted Notes
	 	 	71	 
	SECTION 10.11 Effect of Reclassification, Consolidation, Merger or Sale
	 	 	71	 
	SECTION 10.12 Adjustment for Other Distributions
	 	 	72	 
	SECTION 10.13 Responsibility of Trustee for Conversion Provisions
	 	 	73	 
	SECTION 10.14 Payment of Cash in Lieu of Common Stock
	 	 	74	 
	ARTICLE 11

SUBORDINATION
	 	 	 	 
	 
	 	 	 	 
	SECTION 11.01 Agreement to Subordinate
	 	 	74	 
	SECTION 11.02 Liquidation; Dissolution; Bankruptcy
	 	 	74	 
	SECTION 11.03 Default on Designated Senior Indebtedness
	 	 	75	 
	SECTION 11.04 Acceleration of Notes
	 	 	76	 
	SECTION 11.05 When Distribution Must Be Paid Over
	 	 	76	 
	SECTION 11.06 Notice by the Company
	 	 	77	 
	SECTION 11.07 Subrogation
	 	 	77	 
	SECTION 11.08 Relative Rights
	 	 	77	 
	SECTION 11.09 Subordination May Not Be Impaired by the Company
	 	 	77	 
	SECTION 11.10 Distribution or Notice to Representative
	 	 	78	 
	SECTION 11.11 Rights of Trustee and Paying Agent
	 	 	78	 
	 
	 	 	 	 
	ARTICLE 12

RESERVED
	 	 	 	 
	 
	 	 	 	 
	ARTICLE 13

MISCELLANEOUS
	 	 	 	 
	 
	 	 	 	 
	SECTION 13.01 Trust Indenture Act Controls
	 	 	78	 
	SECTION 13.02 Notices
	 	 	78	 
	SECTION 13.03 Communication by Holders with Other Holders
	 	 	79	 
	SECTION 13.04 Certificate and Opinion as to Conditions Precedent
	 	 	79	 
	SECTION 13.05 Statements Required in Certificate or Opinion
	 	 	80	 
	SECTION 13.06 Separability Clause
	 	 	80	 
	SECTION 13.07 Rules by Trustee, Paying Agent, Conversion Agent and Registrar
	 	 	80	 
	SECTION 13.08 Legal Holidays
	 	 	80	 
	SECTION 13.09 GOVERNING LAW
	 	 	80	 
	SECTION 13.10 No Recourse Against Others
	 	 	80	 
	SECTION 13.11 Successors
	 	 	81	 
	SECTION 13.12 Multiple Originals
	 	 	81	 

iv

 

Table of Contents
(continued)

	 	 	 	 	 	 
	 	 	 	 	  Page  
	EXHIBITS
	 	 	 	 	 
	Exhibit A-1

	 	Form of Face of Global Note	 	 	 
	Exhibit A-2

	 	Form of Certificated Note	 	 	 
	Exhibit B-1

	 	Transfer Certificate	 	 	 
	Exhibit C

	 	Form of Notice of Holder to Elect Repurchase upon a Change in Control	 	 	 
	Exhibit D

	 	Form of Accredited Investor Representation Letter	 	 	 

v

 

CROSS-REFERENCE TABLE*

	 	 	 
	TIA Section	 	Indenture Section
	310(a)(1)
	 	7.09
	(a)(2)
	 	7.09
	(a)(3)
	 	N.A.
	(a)(4)
	 	N.A.
	(a)(5)
	 	7.09
	(b)
	 	7.08; 7.09; 7.10;7.11
	(c)
	 	N.A.
	311(a)
	 	7.13
	(b)
	 	7.13
	(c)
	 	N.A.
	312(a)
	 	2.05
	(b)
	 	13.03
	(c)
	 	13.03
	313(a)
	 	7.14
	(b)(1)
	 	7.14
	(b)(2)
	 	7.14
	(c)
	 	13.02
	(d)
	 	7.14
	314(a)
	 	4.02; 4.03; 13.02
	(b)
	 	12.01(e)
	(c)(1)
	 	13.04
	(c)(2)
	 	13.04
	(c)(3)
	 	N.A.
	(d)
	 	12.01(d)
	(e)
	 	13.05
	(f)
	 	N.A.
	315(a)
	 	7.01
	(b)
	 	7.15; 13.02
	(c)
	 	7.01
	(d)
	 	7.01
	(e)
	 	6.11
	316(a) (last sentence)
	 	2.08
	(a)(1)(A)
	 	6.05
	(a)(1)(B)
	 	6.04
	(a)(2)
	 	N.A.
	(b)
	 	6.07
	317(a)(1)
	 	6.08
	(a)(2)
	 	6.09
	(b)
	 	2.04
	318(a)
	 	13.01

N. A. means Not Applicable

 

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

 

 

     INDENTURE, dated as of October 12, 2006, between FINISAR CORPORATION, a Delaware corporation
(the “Company”), and U.S. BANK TRUST NATIONAL ASSOCIATION, a national banking association, as
Trustee hereunder (the “Trustee”).

RECITALS OF THE COMPANY

     The Company has duly authorized the creation of an issue of its 21/2% Convertible Senior
Subordinated Notes due 2010 (herein called the “Notes”) of substantially the tenor and amount
hereinafter set forth, and to provide therefor the Company has duly authorized the execution and
delivery of this Indenture.

     All things necessary to make the Notes, when the Notes are executed by the Company and
authenticated and delivered hereunder, the valid obligations of the Company, and to make this
Indenture a valid agreement of the Company, in accordance with their and its terms, have been done.
Further, all things necessary to duly authorize the issuance of the Common Stock of the Company
issuable upon the conversion of the Notes, and to duly reserve for issuance the number of shares of
Common Stock issuable upon such conversion, have been done.

     This Indenture is subject to, and shall be governed by, the provisions of the Trust Indenture
Act of 1939, as amended, that are required to be a part of and to govern indentures qualified under
the Trust Indenture Act of 1939, as amended.

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

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

ARTICLE 1

DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

     SECTION 1.01 Definitions. For all purposes of this Indenture, except as otherwise
expressly provided or unless the context otherwise requires:

     (1) the terms defined in this Article have the meanings assigned to them in this Article and
include the plural as well as the singular;

     (2) all accounting terms not otherwise defined herein have the meanings assigned to them in
accordance with GAAP; and

     (3) the words “herein”, “hereof” and “hereunder” and other words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or other subdivision.

1

 

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

     “Applicable Procedures” means, with respect to any transfer or transaction involving a
Global Note or beneficial interest therein, the rules and procedures of the Depositary for such
Note, in each case to the extent applicable to such transaction and as in effect from time to time.

     “Board of Directors” means either the board of directors of the Company or any duly
authorized committee of such board.

     “Board Resolution” means a resolution duly adopted by the Board of Directors, a copy
of which, certified by the Secretary or an Assistant Secretary of the Company to be in full force
and effect on the date of such certification, shall have been delivered to the Trustee.

     “Business Day” means each day of the year other than a Saturday or a Sunday on which
banking institutions are not required or authorized to close in the City of New York or the city in
which the principal corporate trust office of the Trustee is located.

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

     “Certificated Notes” means Notes that are in the form of the Notes attached hereto as
Exhibit A-2.

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

     “Closing Price” of any security on any date of determination means:

    (1) the closing sale price (or, if no closing sale price is reported, the last reported
sale price) of such security on the New York Stock Exchange on such date;

    (2) if such security is not listed for trading on the New York Stock Exchange or the
NASDAQ Stock Market on any such date, the closing sale price as reported in the composite
transactions for the principal U.S. securities exchange on which such security is so listed;

    (3) if such security is not so reported, the last quoted bid price for such security in
the over-the-counter market as reported by the National Quotation Bureau or similar
organization; or

2

 

    (4) if such bid price is not available, the average of the mid-point of the last bid
and ask prices of such security on such date from at least three nationally recognized
independent investment banking firms retained for this purpose by the Company.

     “Commission” means the Securities and Exchange Commission.

     “Common Stock” means the Common Stock, par value $0.001 per share, of the Company
authorized at the date of this instrument as originally executed. Subject to the provisions of
Section 10.11, shares issuable on conversion or repurchase of Notes shall include only shares of
Common Stock or shares of any class or classes of common stock resulting from any reclassification
or reclassifications thereof; provided, however, that if at any time there shall be more than one
such resulting class, the shares so issuable on conversion of Notes shall include shares of all
such classes, and the shares of each such class then so issuable shall be substantially in the
proportion which the total number of shares of such class resulting from all such reclassifications
bears to the total number of shares of all such classes resulting from all such reclassifications.

     “common stock” means any stock of any class of capital stock which has 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 issuer.

     “Company” means the party named as the “Company” 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. The foregoing sentence shall likewise apply
to any subsequent such successor or successors.

     “Company Request” or “Company Order” means a written request or order signed
in the name of the Company by any Officer.

     “Conversion Agent” means any person authorized by the Company to convert Notes in
accordance with Article 10 hereof.

     “Conversion Rate” means the rate at which shares of Common Stock shall be delivered
upon conversion, which rate shall be initially 304.9055 shares of Common Stock for each $1,000
principal amount of Notes, as adjusted from time to time pursuant to the provisions of this
Indenture.

     “Conversion Reference Period” means:

     (1) for Notes that are converted after the Company has delivered a notice of Provisional
Redemption to the Trustee, the twenty consecutive Trading Days beginning on the third Trading Day
following the Provisional Redemption Date (in the case of Notes being converted that were
previously called for redemption, including a partial redemption, this will only apply to those
Notes that are subject to such redemption);

     (2) for Notes that are converted during the 60 days prior to the Stated Maturity, the twenty
consecutive Trading Days beginning on the third Trading Day following the Stated Maturity; and

3

 

     (3) in all other instances, the twenty consecutive Trading Days beginning on the third Trading
Day following the conversion date.

     “Conversion Value” means, for each $1,000 principal amount of Notes, the average of
the Daily Conversion Values for each of the twenty consecutive Trading Days of the Conversion
Reference Period.

     “Convertible Subordinated Notes” means the Company’s 51/4% Convertible Subordinated
Notes due 2008 issued pursuant to that certain indenture dated as of October 15, 2001 and the 21/2%
Convertible Subordinated Notes due 2010 issued pursuant to that certain indenture dated as of
October 15, 2003.

     “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 100 Wall Street, 16th Floor, New York, New York, 10005, 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 a successor Trustee may
designate from time to time by notice to the Holders and the Company).

     “Daily Conversion Value” means, with respect to any Trading Day, the product of (1)
the applicable Conversion Rate and (2) the Volume Weighted Average Price on such Trading Day.

     “Daily Share Amount” means, for each Trading Day of the Conversion Reference Period
and for each $1,000 principal amount of Notes surrendered for conversion, a number of shares (but
in no event less than zero) equal to (i) the amount of (a) the Volume Weighted Average Price for
such Trading Day multiplied by the applicable Conversion Rate, less (b) $1,000; divided by (ii) the
Volume Weighted Average Price for such Trading Day multiplied by 20.

     “Default” means, when used with respect to the Notes, any event which 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 that expressly provides that such Senior Indebtedness shall be “Designated
Senior Indebtedness” for purposes of this Indenture.

     “Dollar” or “U.S.$” means a dollar or other equivalent unit in such coin or
currency of the United States as at the time shall be legal tender for the payment of public and
private debts.

     “GAAP” means United States generally accepted accounting principles as in effect from
time to time.

     “Global Notes” means Notes that are in the form of the Notes attached hereto as
Exhibit A-1.

4

 

          “Guarantee” means a guarantee (other than by endorsement of negotiable instruments for
collection in the ordinary course of business), direct or indirect, contingent or otherwise, in any
manner (including, without limitation, letters of credit and reimbursement agreements in respect
thereof), of all or any part of any Indebtedness.

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

          “Indebtedness” means, with respect to any person, without duplication:

     (1) all indebtedness, obligations and other liabilities, contingent or otherwise, of
such person for borrowed money (including overdrafts) or for the deferred purchase price of
property or services, excluding any trade payables and other accrued current liabilities
incurred in the ordinary course of business, but including, without limitation, all
obligations, contingent or otherwise, of such person in connection with any letters of
credit and acceptances issued under letter of credit facilities, acceptance facilities or
other similar facilities;

     (2) all obligations of such person evidenced by bonds, credit or loan agreements,
notes, debentures or other similar instruments;

     (3) indebtedness of such person created or arising under any conditional sale or other
title retention agreement with respect to property acquired by such person (even if the
rights and remedies of the seller or lender under such agreement in the event of default are
limited to repossession or sale of such property), but excluding trade payables arising in
the ordinary course of business;

     (4) all obligations and liabilities, contingent or otherwise, in respect of leases of
the person required, in conformity with GAAP, to be accounted for as capitalized lease
obligations on the balance sheet of the person and all obligations and other liabilities,
contingent or otherwise, under any lease or related document, including a purchase
agreement, in connection with the lease of real property or improvements thereon which
provides that the person is contractually obligated to purchase or cause a third party to
purchase the leased property or pay an agreed upon residual value of the leased property to
the lessor and the obligations of the person under the lease or related document to purchase
or to cause a third party to purchase the leased property whether or not such lease
transaction is characterized as an operating lease or a capitalized lease in accordance with
GAAP, including, without limitations, synthetic lease obligations;

     (5) all obligations of such person under or in respect of interest rate agreements,
currency agreements or other swap, cap floor or collar agreement, hedge agreement, forward
contract or similar instrument or agreement or foreign currency, hedge, exchange or purchase
or similar instrument or agreement;

     (6) all indebtedness referred to in (but not excluded from) the preceding clauses (1)
through (5) of other persons and all dividends of other persons, the payment of which is
secured by (or for which the holder of such indebtedness has an existing right, contingent
or otherwise, to be secured by) any Lien or with respect to property

5

 

(including, without limitation, accounts and contract rights) owned by such person,
even though such person has not assumed or become liable for the payment of such
indebtedness (the amount of such obligation being deemed to be the lesser of the value of
such property or asset or the amount of the obligation so secured);

     (7) all guarantees by such person of indebtedness referred to in (but not excluded
from) this definition of any other person;

     (8) all Redeemable Capital Stock of such person valued at the greater of its voluntary
or involuntary maximum fixed repurchase price plus accrued and unpaid dividends;

     (9) the present value of the obligations of such person as lessee for net rental
payments (excluding all amounts required to be paid on account of maintenance and repairs,
insurance, taxes, assessments, water, utilities and similar charges to the extent included
in such rental payments) during the remaining term of the lease included in any sale and
leaseback transaction, including any period for which such lease has been extended or may,
at the option of the lessor, be extended. Such present value shall be calculated using a
discount rate equal to the rate of interest implicit in such transaction, determined in
accordance with GAAP; and

     (10) any and all refinancings, replacements, deferrals, renewals, extensions and
refundings of or amendments, modifications or supplements to, any indebtedness, obligation
or liability of the kind described in clauses (1) through (9) above.

               “Indenture” means this Indenture, as amended or supplemented from time to time in
accordance with the terms hereof, including the provisions of the TIA that are deemed to be a part
hereof.

               “Institutional Accredited Investor” shall mean an institution that is an “accredited
investor” as that term is defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the
Securities Act.

               “Initial Purchasers” means Aristeia International Limited, Aristeia Partners LP,
Calamos Market Neutral Fund – Calamos Investment Trust, CNH CA Master Account, L.P., FGO Master
Fund Ltd., Fore Multi Strategy Master Fund Ltd., Fore Convertible Master Fund Ltd., Fore ERISA Fund
Ltd., Man Mac 1 Limited, Symphony Asset Management and Wolverine Asset Management.

               “Interest Payment Date” means the Stated Maturity of an installment of interest on the
Notes.

               “Interest Rate” means 21/2% per annum.

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

6

 

     “Lien” means, with respect to any asset, any mortgage, lien, pledge, charge, security
interest or encumbrance of any kind in respect of such asset given to secure Indebtedness, whether
or not filed, recorded or otherwise perfected under applicable law (including any conditional sale
or other title retention agreement, any lease in the nature thereof, any option or other agreement
to sell or give a security interest in and any filing of or agreement to give any financing
statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction with
respect to any such lien, pledge, charge or security interest).

     “Liquidated Damages” has the meaning specified in the Registration Rights Agreement.

     “Notes” has the meaning ascribed to it in the first paragraph under the caption
“Recitals of the Company”.

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

     “Officers’ Certificate” means a written certificate containing the information
specified in Sections 13.04 and 13.05, signed in the name of the Company by any two Officers, and
delivered to the Trustee. An Officers’ Certificate given pursuant to Section 4.03 shall be signed
by the principal executive, principal financial or principal accounting officer of the Company but
need not contain the information specified in Sections 13.04 and 13.05.

     “144A Global Note” means a permanent Global Note in the form of the Note attached
hereto as Exhibit A-1, and that is deposited with and registered in the name of the Depositary,
representing Notes sold in reliance on Rule 144A.

     “Opinion of Counsel” means a written opinion containing the information specified in
Sections 13.04 and 13.05, from legal counsel who is reasonably acceptable to the Trustee or the
Registrar, as applicable. The counsel may be an employee of, or counsel to, the Company, the
Trustee or the Registrar.

     “person” or “Person” means any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust, unincorporated
organization, or government or any agency or political subdivision thereof, including any
subdivision or ongoing business of any such entity or substantially all of the assets of any such
entity, subdivision or business.

     “principal” of a Note means the principal amount due on the Stated Maturity as set
forth on the face of the Note.

     “Redeemable Capital Stock” means any class of the Company’s Capital Stock that, either
by its terms, by the terms of any securities into which it is convertible or exchangeable or by
contract or otherwise, is, or upon the happening of an event or passage of time would be, required
to be redeemed (whether by sinking fund or otherwise) prior to the date that is 91 days after the
Stated Maturity of the Notes or is redeemable at the option of the holder

7

 

thereof at any time prior to such date, or is convertible into or exchangeable for debt
securities at any time prior to such date (unless it is convertible or exchangeable solely at the
Company’s option).

     “Registration Rights Agreement” means the Registration Rights Agreement of even date
herewith entered into by the Company and the Initial Purchasers.

     “Regular Record Date” means, with respect to the interest payable on any Interest
Payment Date, the close of business on the April 1 or October 1 (whether or not a Business Day), 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 department of the Trustee, including any vice president, assistant vice
president, assistant secretary, assistant treasurer, trust officer or any other officer of the
Trustee who customarily performs functions similar to those performed by the Persons who at the
time shall be such officers, respectively, or to whom any corporate trust matter is referred
because of such person’s knowledge of and familiarity with the particular subject.

     “Restricted Note” means a Note required to bear the restrictive legend set forth in
the form of Note set forth in Exhibits A-1 and A-2 of this Indenture.

     “Restriction Termination Date” means, with respect to any Note, the date that is two
years after the later of:

     (1) the Issue Date of the Note, or, in the case of Common Stock, the Issue Date of the Note
upon the conversion of which such Common Stock was issued; and

     (2) the last date on which any “affiliate,” as defined in Rule 144, of the Company was the
owner of such Note or Common Stock.

     “Rule 144” means Rule 144 promulgated under the Securities Act (or any successor
provision), as it may be amended from time to time.

     “Rule 144A” means Rule 144A promulgated under the Securities Act (or any successor
provision), as it may be amended from time to time.

     “Securities Act” means the United States Securities Act of 1933 (or any successor
statute), as amended from time to time.

     “Senior Indebtedness” means:

   (1) the principal of and premium, if any, and interest on, and fees, costs, enforcement
expenses, collateral protection expenses and other reimbursement or indemnity obligations in
respect of all of the Indebtedness of the Company or obligations to any person for money
borrowed that is evidenced by a note, bond, debenture, loan agreement, or similar instrument
or agreement including default interest and interest accruing after a bankruptcy;

8

 

     (2) commitment or standby fees due and payable to lending institutions with respect to
credit facilities available to the Company;

     (3) all of the Company’s noncontingent obligations (i) for the reimbursement of any
obligor on any letter of credit, banker’s acceptance or similar credit transaction, (ii)
under interest rate swaps, caps, collars, options and similar arrangements and (iii) under
any foreign exchange contract, currency swap agreement, futures contract, currency option
contract or other foreign currency hedge;

     (4) all of the Company’s obligations under leases for real estate, facilities,
equipment or related assets, whether or not capitalized, that are entered into or leased for
financing purposes;

     (5) any liabilities of others described in clauses (1) through (4) above that the
Company has guaranteed or which are otherwise the Company’s legal liability; and

     (6) renewals, extensions, refundings, refinancings, restructurings, amendments and
modifications of any such indebtedness or guarantee.

     Notwithstanding the foregoing, “Senior Indebtedness” shall not include:

     (a) Indebtedness or other obligations of the Company that by its terms ranks equal or
junior in right of payment to the Notes;

     (b) Indebtedness evidenced by the Notes;

     (c) Indebtedness evidenced by the Company’s Convertible Subordinated Notes,
provided that the Holders of the Notes shall not be entitled to any of the
U.S. Government Obligations pledged for the exclusive benefit of the holders of the notes
described in this subsection (c) (or the proceeds thereof);

     (d) Indebtedness of the Company that by operation of law is subordinate to any general
unsecured obligations of the Company;

     (e) accounts payable or other liabilities owed or owing by the Company to trade
creditors (including guarantees thereof or instruments evidencing such liabilities);

     (f) amounts owed by the Company for compensation to employees or for services rendered
to the Company;

     (g) Indebtedness of the Company to any Subsidiary or any other Affiliate of the Company
or any of such Affiliate’s Subsidiaries, except if it is pledged as security for any Senior
Indebtedness;

     (h) Capital Stock of the Company;

     (i) Indebtedness of the Company evidenced by any Guarantee of any such Indebtedness
ranking equal or junior in right of payment to the Notes; and

9

 

     (j) Indebtedness of the Company which, when incurred and without respect to any
election under Section 1111(b) of Title 11 of the United States Code, is without recourse to
the Company.

     “Significant Subsidiary” means a Subsidiary of the Company, including the Subsidiaries
of such Subsidiary, that meets any of the following conditions:

     (1) the Company’s and its other Subsidiaries’ investments in and advances to the Subsidiary
exceed 10 percent of the total assets of the Company and its Subsidiaries consolidated as of the
end of the most recently completed fiscal year; or

     (2) the Company’s and its other Subsidiaries’ proportionate share of the total assets (after
intercompany eliminations) of the Subsidiary exceeds 10 percent of the total assets of the Company
and its Subsidiaries consolidated as of the end of the most recently completed fiscal year; or

     (3) the Company’s and its other Subsidiaries’ equity in the income from continuing operations
before income taxes, extraordinary items and cumulative effect of a change in accounting principles
of the Subsidiary exceeds 10 percent of such income of the Company and its Subsidiaries
consolidated for the most recently completed fiscal year.

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

     “Stock Price” means the price paid, or deemed to be paid, per share of the Common
Stock in connection with a Change in Control as determined pursuant to Section 10.01(f).

     “Subsidiary” means (i) a corporation, a majority of whose Capital Stock with voting
power, under ordinary circumstances, to elect directors is, at the date of determination, directly
or indirectly owned by the Company, by one or more Subsidiaries of the Company or by the Company
and one or more Subsidiaries of the Company, (ii) a partnership in which the Company or a
Subsidiary of the Company holds a majority interest in the equity capital or profits of such
partnership, or (iii) any other person (other than a corporation) in which the Company, a
Subsidiary of the Company or the Company and one or more Subsidiaries of the Company, directly or
indirectly, at the date of determination, has (x) at least a majority ownership interest or (y) the
power to elect or direct the election of a majority of the directors or other governing body of
such person.

     “TIA” means the Trust Indenture Act of 1939 as in effect on the date of this
Indenture; provided, however, that in the event the TIA is amended after such date,
TIA means, to the extent required by any such amendment, the TIA as so amended.

     “Trading Day” means a day during which trading in the Common Stock generally occurs on
the New York Stock Exchange or, if the Common Stock is not listed on the New York Stock Exchange,
on the principal other national or regional securities exchange on which the Common Stock is then
listed or, if the Common Stock is not listed on a national or regional

10

 

securities exchange, on the National Association of Securities Dealers Automated Quotation
System or, if the Common Stock is not quoted on the National Association of Securities Dealers
Automated Quotation System, on the principal other market on which the Common Stock is then traded.

     “Trading Price” of the Notes on any date of determination means the average of the
secondary market bid quotations per $1,000 principal amount of Notes obtained by the Trustee for
$5,000,000 principal amount of Notes at approximately 3:30 p.m., New York City time, on such
determination date from three nationally recognized securities dealers the Company selects;
provided that if three such bids cannot reasonably be obtained by the Trustee, but two such
bids are obtained, then the average of the two bids shall be used, and if only one such bid can
reasonably be obtained by the Trustee, that one bid shall be used. The Company will provide prompt
written notice to the Trustee identifying the three nationally recognized security dealers selected
by the Company. If the Trustee cannot reasonably obtain at least one bid for $5,000,000 principal
amount of Notes from a nationally recognized securities dealer, then for purposes of determining
whether the condition to conversion of the Notes set forth in Section 10.01(a)(2) has been
satisfied, the Trading Price per $1,000 principal amount of Notes will be deemed to be less than
98% of the product of the Volume Weighted Average Price of the Common Stock and the Conversion Rate
per $1,000 principal amount of Notes.

     “Trustee” means the party named as the “Trustee” in the first paragraph of this
Indenture until a successor replaces it pursuant to the applicable provisions of this Indenture
and, thereafter, shall mean such successor. The foregoing sentence shall likewise apply to any
subsequent such successor or successors.

     “United States” means the United States of America (including the States and the
District of Columbia), its territories, its possessions and other areas subject to its jurisdiction
(its “possessions” including Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake
Island and the Northern Mariana Islands).

     “U.S. Government Obligations” means securities that are (i) direct obligations of the
United States of America, for the payment of which its full faith and credit is pledged or (ii)
obligations of a Person controlled or supervised by or acting as an agency or instrumentality of
the United States of America, the payment of which is unconditionally guaranteed as a full faith
and credit obligation by the United States of America, which, in either case, are not callable or
redeemable at the option of the issuer thereof at any time prior to the Stated Maturity of the
eighth interest installment under the Notes, and shall also include a depository receipt issued by
a bank or trust company as custodian with respect to any such U.S. Government Obligation or a
specific payment of interest on or principal of any such U.S. Government Obligation held by such
custodian for the account of the holder of a depository receipt; provided that (except as required
by law) such custodian is not authorized to make any deduction from the amount payable to the
holder of such depository receipt from any amount received by the custodian in respect of the U.S.
Government Obligation for the specific payment of interest on or principal of the U.S. Government
Obligation evidenced by such depository receipt.

     “Volume Weighted Average Price” per share of Common Stock on any Trading Day means
such price as displayed on Bloomberg (or any successor service) page “FNSR Equity

11

 

VAP” in respect of the period from 9:30 a.m. to 4:00 p.m., New York City time, on such Trading
Day; or, if such price is not available, the Volume Weighted Average Price means the market value
per share of Common Stock on such day as determined by a nationally recognized independent
investment banking firm retained for this purpose by the Company.

     SECTION 1.02 Other Definitions.

	 	 	 	 	 
	 	 	Defined in	 
	Term	 	Section	 
	“Act”
	 	 	1.05	(a)
	“Agent Members”
	 	 	2.12	 
	“Bankruptcy Law”
	 	 	6.01	 
	“Change in Control”
	 	 	3.10	(a)
	“Change in Control Repurchase Date”
	 	 	3.10	(a)
	“Change in Control Repurchase Notice”
	 	 	3.10	(d)
	“Change in Control Repurchase Price”
	 	 	3.10	(a)
	“Company Change in Control Notice”
	 	 	3.10	(b)
	“Conversion Agent”
	 	 	2.03	 
	“Conversion Price”
	 	 	10.01	 
	“Conversion Trigger Price”
	 	 	10.01	(a)
	“Current Market Price”
	 	 	10.04	(g)
	“Custodian”
	 	 	6.01	 
	“Depositary”
	 	 	2.01	(a)
	“Determination Date”
	 	 	10.04	(e)
	“Distribution Notice”
	 	 	10.01	(b)
	“DTC”
	 	 	2.01	(a)
	“Event of Default”
	 	 	6.01	 
	“Exchange Act”
	 	 	3.10	(a)
	“excluded securities”
	 	 	10.04	(d)
	“Expiration Time”
	 	 	10.04	(f)
	“fair market value”
	 	 	10.04	(g)
	“Legal Holiday”
	 	 	13.08	 
	“Legend”
	 	 	2.06	(f)
	“Non-Electing Share”
	 	 	10.11	 
	“Non-Payment Default”
	 	 	11.03	(b)
	“Notice Date”
	 	 	3.01	 
	“Notice of Default”
	 	 	6.01	 
	“Paying Agent”
	 	 	2.03	 
	“Payment Blockage Period”
	 	 	11.03	(b)
	“Payment Default”
	 	 	11.03	(a)
	“Permitted Junior Securities”
	 	 	11.02	 
	“Provisional Redemption”
	 	 	3.01	 
	“Provisional Redemption Date”
	 	 	3.01	 
	“Provisional Redemption Price”
	 	 	3.01	 
	“Purchased Shares”
	 	 	10.04	(f)
	“QIB”
	 	 	2.01	(a)

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	 	 	Defined in	 
	Term	 	Section	 
	“Record Date”
	 	 	10.04	(g)
	“Reference Period”
	 	 	10.04	(d)
	“Registrar”
	 	 	2.03	 
	“Rule 144A Information”
	 	 	4.06	 
	“Trigger Event”
	 	 	10.04	(d)
	“Valuation Expert”
	 	 	10.02	(d)

     SECTION 1.03 Incorporation by Reference of Trust Indenture Act. Whenever this
Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made
a part of this Indenture. The following TIA terms used in this Indenture have the following
meanings:

     “Commission” means the Commission.

     “indenture notes” means the Notes.

     “indenture note holder” means a Noteholder.

     “indenture to be qualified” means this Indenture.

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

     “obligor” on the indenture Notes means the Company.

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

     SECTION 1.04 Rules of Construction. Unless the context otherwise requires:

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

     (b) an accounting term not otherwise defined has the meaning assigned to it in
accordance with GAAP as in effect from time to time;

     (c) “or” is not exclusive;

     (d) “including” means including, without limitation; and

     (e) words in the singular include the plural, and words in the plural include the
singular.

     SECTION 1.05 Acts of Holders. (a) Any request, demand, authorization, direction,
notice, consent, waiver or other action provided by this Indenture to be given or taken by Holders
may be embodied in and evidenced by one or more instruments of substantially similar tenor signed
by such Holders in person or by their agent duly appointed in writing; and, except as herein
otherwise expressly provided, such action shall become effective when such

13

 

instrument or instruments are delivered to the Trustee and, where it is hereby expressly
required, to the Company. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the “Act” of Holders signing such instrument
or instruments. Proof of execution of any such instrument or of a writing appointing any such
agent shall be sufficient for any purpose of this Indenture and conclusive in favor of the Trustee
and the Company, if made in the manner provided in this Section.

     (b) The fact and date of the execution by any Person of any such instrument or writing may be
proved by the affidavit of a witness of such execution or by a certificate of a notary public or
other officer authorized by law to take acknowledgments of deeds, certifying that the individual
signing such instrument or writing acknowledged to such officer the execution thereof. Where such
execution is by a signer acting in a capacity other than such signer’s individual capacity, such
certificate or affidavit shall also constitute sufficient proof of such signer’s authority. The
fact and date of the execution of any such instrument or writing, or the authority of the Person
executing the same, may also be proved in any other manner that the Trustee deems sufficient.

     The ownership of Notes shall be proved by the register for the Notes or by a certificate of
the Registrar.

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

     If the Company shall solicit from the Holders any request, demand, authorization, direction,
notice, consent, waiver or other Act, the Company may, at its option, by or pursuant to a
resolution of the Board of Directors, fix in advance a record date for the determination of Holders
entitled to give such request, demand, authorization, direction, notice, consent, waiver or other
Act, but the Company shall have no obligation to do so. If such a record date is fixed, such
request, demand, authorization, direction, notice, consent, waiver or other Act may be given before
or after such record date, but only the Holders of record at the close of business on such record
date shall be deemed to be Holders for purposes of determining whether Holders of the requisite
proportion of outstanding Notes have authorized or agreed or consented to such request, demand,
authorization, direction, notice, consent, waiver or other Act, and for that purpose the
outstanding Notes shall be computed as of such record date; provided that no such authorization,
agreement or consent by the Holders on such record date shall be deemed effective unless it shall
become effective pursuant to the provisions of this Indenture not later than six months after the
record date.

ARTICLE 2

THE NOTES

     SECTION 2.01 Form and Dating. The Global Notes and the Trustee’s certificate of
authentication to be borne by such Notes and the Certificated Notes and the

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Trustee’s Certificate of Authentication to be borne by such Notes shall be substantially in
the form annexed hereto as Exhibits A-1 and A-2, respectively, which are incorporated in and made a
part of this Indenture. Each Note shall be dated the date of its authentication. The terms and
provisions contained in the form of Note shall constitute, and are hereby expressly made, a part of
this Indenture and to the extent applicable, the Company and the Trustee, by their execution and
delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby.

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

     (a) Global Notes. Notes offered and sold within the United States to qualified
institutional buyers as defined in Rule 144A (“QIBs”) in reliance on Rule 144A shall be issued,
initially in the form of a 144A Global Note, which shall be deposited with the Trustee at its
Corporate Trust Office, as custodian for, and registered in the name of, The Depository Trust
Company (“DTC”) or the nominee thereof (such depositary, or any successor thereto, and any such
nominee being hereinafter referred to as the “Depositary”), duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate principal amount of the 144A
Global Notes may from time to time be increased or decreased by adjustments made on the records of
the Trustee and the Depositary as hereinafter provided.

     (b) Global Notes in General. Each Global Note shall represent such of the outstanding
Notes as shall be specified therein and each shall provide that it shall represent the aggregate
amount of outstanding Notes from time to time endorsed thereon and that the aggregate amount of
outstanding Notes represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges, redemptions and conversions.

     Any adjustment of the aggregate principal amount of a Global Note to reflect the amount of any
increase or decrease in the amount of outstanding Notes represented thereby shall be made by the
Trustee in accordance with instructions given by the Holder thereof as required by Section 2.12
hereof and shall be made on the records of the Trustee and the Depositary.

     (c) Book-Entry Provisions. This Section 2.01(c) shall apply only to Global Notes
deposited with or on behalf of the Depositary.

     The Company shall execute and the Trustee shall, in accordance with this Section 2.01(c),
authenticate and deliver initially one or more Global Notes that (a) shall be registered in the
name of the Depositary, (b) shall be delivered by the Trustee to the Depositary or pursuant to the
Depositary’s instructions and (c) shall bear legends substantially to the following effect:

“UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO THE

15

 

ISSUER 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.

TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN
PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED
TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN ARTICLE 2 OF THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.”

          (d) Restrictive Legends. Until the Restriction Termination Date, all Global Notes and
all Certificated Notes shall bear the Legend, unless such Notes have been transferred pursuant to a
registration statement that has been declared effective under the Securities Act. Until the
Restriction Termination Date, the Company covenants that any stock certificate representing shares
of Common Stock delivered by the Company upon conversion of any Notes will bear the Legend, unless
such shares have been sold pursuant to a registration statement that has been declared effective
under the Securities Act.

          (e) Certificated Notes. Notes not issued as interests in the Global Notes will be
issued in certificated form substantially in the form of Exhibit A-2 attached hereto.

          SECTION 2.02 Execution and Authentication. The Notes shall be executed on behalf of
the Company by any Officer. The signature of the Officer on the Notes may be manual or facsimile.

          Notes bearing the manual or facsimile signatures of individuals who were at the time of the
execution of the Notes the proper Officers shall bind the Company, notwithstanding that such
individuals or any of them have ceased to hold such offices prior to the authentication and
delivery of such Notes or did not hold such offices at the date of authentication of such Notes.

          No Note shall be entitled to any benefit under this Indenture or be valid or obligatory for
any purpose unless there appears on such Note a certificate of authentication substantially in the
form provided for herein duly executed by the Trustee by manual signature of an authorized
signatory, and such certificate upon any Note shall be conclusive evidence, and the only evidence,
that such Note has been duly authenticated and delivered hereunder.

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     The Trustee shall authenticate and deliver Notes for original issue in an aggregate principal
amount of up to $100,000,000 upon a Company Order without any further action by the Company. The
Trustee shall not authenticate an aggregate principal amount of Notes outstanding at any time in
excess of the amount set forth in the foregoing sentence, except as provided in Section 2.07.

     The Notes shall be issued only in registered form without coupons and only in denominations of
$1,000 in principal amount and any whole multiple thereof.

     SECTION 2.03 Registrar, Paying Agent and Conversion Agent. The Company shall maintain
an office or agency where Notes may be presented for registration of transfer or for exchange
(“Registrar”), an office or agency where Notes may be presented for repurchase or payment (“Paying
Agent”) and an office or agency where Notes may be presented for conversion (“Conversion Agent”).
The Registrar shall keep a register of the Notes and of their transfer and exchange. The Company
may have one or more co-registrars, one or more additional paying agents and one or more additional
conversion agents. The term Paying Agent includes any additional paying agent, including any named
pursuant to Section 4.05. The term Conversion Agent includes any additional conversion agent,
including any named pursuant to Section 4.05.

     The Company shall enter into an appropriate agency agreement with any Registrar, Paying Agent,
Conversion Agent or co-registrar (to the extent such agents are other than 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 such agent. If the Company fails to
maintain a Registrar, Paying Agent or Conversion Agent, the Trustee shall act as such and shall be
entitled to appropriate compensation therefor pursuant to Section 7.06. The Company or any
Subsidiary or an Affiliate of either of them may act as Paying Agent, Registrar, Conversion Agent
or co-registrar.

     The Company initially appoints the Trustee as Registrar, Conversion Agent and Paying Agent in
connection with the Notes.

     SECTION 2.04 Paying Agent to Hold Money and Notes in Trust. Except as otherwise
provided herein, on or prior to each due date of payments in respect of any Note, the Company shall
deposit with the Paying Agent a sum of money (in immediately available funds if deposited on the
due date) sufficient to make such payments when so becoming due. The Company shall require each
Paying Agent (other than the Trustee) to agree in writing that the Paying Agent shall hold in trust
for the benefit of Noteholders or the Trustee all money held by the Paying Agent for the making of
payments in respect of the Notes and shall notify the Trustee of any default by the Company in
making any such payment. At any time during the continuance of any such default, the Paying Agent
shall, upon the written request of the Trustee, forthwith pay to the Trustee all money so held in
trust. If the Company, a Subsidiary or an Affiliate of either of them acts as Paying Agent, it
shall segregate the money held by it as Paying Agent and hold it as a separate trust fund. The
Company at any time may require a Paying Agent to pay all money held by it to the Trustee and to
account for any funds disbursed by it. Upon doing so, the Paying Agent shall have no further
liability for the money.

17

 

     SECTION 2.05 Noteholder Lists. The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and addresses of
Noteholders. If the Trustee is not the Registrar, the Company shall cause to be furnished to the
Trustee on or before each semiannual Interest Payment Date a listing of Noteholders dated within 13
days of the date on which the list is furnished and at such other times as the Trustee may request
in writing a list in such form and as of such date as the Trustee may reasonably require of the
names and addresses of Noteholders.

     SECTION 2.06 Transfer and Exchange. Subject to Section 2.12 hereof, (a) upon
surrender for registration of transfer of any Note, together with a written instrument of transfer
satisfactory to the Registrar duly executed by the Noteholder or such Noteholder’s attorney duly
authorized in writing, at the office or agency of the Company designated as Registrar or
co-registrar pursuant to Section 2.03, the Company shall execute, and the Trustee shall
authenticate and deliver, in the name of the designated transferee or transferees, one or more new
Notes of any authorized denomination or denominations, of a like aggregate principal amount. The
Company shall not charge a service charge for any registration of transfer or exchange, but the
Company may require payment of a sum sufficient to pay all taxes, assessments or other governmental
charges that may be imposed in connection with the transfer or exchange of the Notes from the
Noteholder requesting such transfer or exchange.

     At the option of the Holder, Notes may be exchanged for other Notes of any authorized
denomination or denominations, of a like aggregate principal amount, upon surrender of the Notes to
be exchanged, together with a written instrument of transfer satisfactory to the Registrar duly
executed by the Noteholder or such Noteholder’s attorney duly authorized in writing, at such office
or agency. Whenever any Notes are so surrendered for exchange, the Company shall execute, and the
Trustee shall authenticate and deliver, the Notes that the Holder making the exchange is entitled
to receive.

     The Company shall not be required to make, and the Registrar need not register, transfers or
exchanges of Notes selected for redemption (except, in the case of Notes to be redeemed in part,
the portion thereof not to be redeemed) or any Notes in respect of which a Change in Control
Repurchase Notice (as defined in Section 3.10(d)) has been given and not withdrawn by the Holder
thereof in accordance with the terms of this Indenture (except, in the case of Notes to be
repurchased in part, the portion thereof not to be repurchased) or any Notes for a period of 15
days before the mailing of a notice of redemption of Notes to be redeemed.

     (b) Notwithstanding any provision to the contrary herein, so long as a Global Note remains
outstanding and is held by or on behalf of the Depositary, transfers of a Global Note, in whole or
in part, shall be made only in accordance with Section 2.12 and this Section 2.06(b). Transfers of
a Global Note shall be limited to transfers of such Global Note in whole, or in part, to nominees
of the Depositary or to a successor of the Depositary or such successor’s nominee.

     (c) Successive registrations and registrations of transfers and exchanges as aforesaid may be
made from time to time as desired, and each such registration shall be noted on the register for
the Notes.

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

     (e) No Registrar shall be required to make registrations of transfer or exchange of Notes
during any periods designated in the text of the Notes or in this Indenture as periods during which
such registration of transfers and exchanges need not be made.

     (f) If Notes are issued upon the transfer, exchange or replacement of Notes subject to
restrictions on transfer and bearing the legends set forth on the forms of Note attached hereto as
Exhibits A-1 and A-2 setting forth such restrictions (collectively, the “Legend”), or if a request
is made to remove the Legend on a Note, the Notes so issued shall bear the Legend, or the Legend
shall not be removed, as the case may be, unless there is delivered to the Company and the
Registrar such satisfactory evidence, which shall include an Opinion of Counsel, as may be
reasonably required by the Company and the Registrar, that neither the Legend nor the restrictions
on transfer set forth therein are required to ensure that transfers thereof comply with the
provisions of Rule 144A or Rule 144 or that such Notes are not “restricted” within the meaning of
Rule 144. Upon (i) provision of such satisfactory evidence, or (ii) notification by the Company to
the Trustee and Registrar of the sale of such Note pursuant to a registration statement that is
effective at the time of such sale, the Trustee, at the written direction of the Company, shall
authenticate and deliver a Note that does not bear the Legend. If the Legend is removed from the
face of a Note and the Note is subsequently held by an affiliate, as defined in Rule 144, of the
Company, the Legend shall be reinstated.

     SECTION 2.07 Replacement Notes. If (a) any mutilated Note is surrendered to the
Trustee, or (b) the Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Note, and there is delivered to the Company and the Trustee such
Note (in the case of mutilation) or indemnity (in all other cases) as may be required by them to
save each of them harmless, then, in the absence of notice to the Company or the Trustee that such
Note 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 Note or in
lieu of any such destroyed, lost or stolen Note, a new Note of like tenor and principal amount,
bearing a number not contemporaneously outstanding.

     In case any such mutilated, destroyed, lost or stolen Note has become or is about to become
due and payable, or is about to be repurchased by the Company pursuant to Article 3 hereof, the
Company in its discretion may, instead of issuing a new Note, pay or repurchase such Note, as the
case may be.

     Upon the issuance of any new Notes 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 expenses (including the fees and expenses of the Trustee) connected
therewith.

     Every new Note issued pursuant to this Section 2.07 in lieu of any mutilated, destroyed, lost
or stolen Note shall constitute an original additional contractual obligation of the Company,
whether or not the destroyed, lost or stolen Note shall be at any time enforceable by

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anyone, and shall be entitled to all benefits of this Indenture equally and proportionately
with any and all other Notes duly issued hereunder.

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

     SECTION 2.08 Outstanding Notes; Determinations of Holders’ Action. Notes outstanding
at any time are all the Notes authenticated by the Trustee except for those cancelled by it or
delivered to it for cancellation, those paid pursuant to Section 2.07 and those described in this
Section 2.08 as not outstanding. A Note does not cease to be outstanding because the Company or an
Affiliate thereof holds the Note; provided, however, that in determining whether the Holders of the
requisite principal amount of the outstanding Notes have given or concurred in any request, demand,
authorization, direction, notice, consent, waiver or other Act hereunder, Notes owned by the
Company or any other obligor upon the Notes or any Affiliate of the Company or such other obligor
shall be disregarded and deemed not to be outstanding, except that, in determining whether the
Trustee shall be protected in relying upon any such request, demand, authorization, direction,
notice, consent, waiver, or other Act only Notes which a Responsible Officer of the Trustee knows
to be so owned shall be so disregarded. Subject to the foregoing, only Notes outstanding at the
time of such determination shall be considered in any such determination (including, without
limitation, determinations pursuant to Articles 6 and 9).

     If a Note is replaced pursuant to Section 2.07, it ceases to be outstanding unless the Trustee
receives proof satisfactory to it that the replaced Note is held by a bona fide purchaser.

     If the Paying Agent holds, in accordance with this Indenture, on a Provisional Redemption
Date, or on the Business Day following a Change in Control Repurchase Date or on Stated Maturity,
money or securities, if permitted hereunder, sufficient to pay Notes payable on that date, then
immediately after such Provisional Redemption Date, Change in Control Repurchase Date, or Stated
Maturity, as the case may be, such Notes shall cease to be outstanding and interest on such Notes
shall cease to accrue; provided that, if such Notes are to be redeemed, notice of such redemption
has been duly given pursuant to this Indenture or provision therefor reasonably satisfactory to the
Trustee has been made; provided further that, with respect to a Change in Control Repurchase Date,
no Change in Control Repurchase Notice with respect to such Notes has been withdrawn validly.

     If a Note is converted in accordance with Article 10, then from and after the time of
conversion on the conversion date, such Note shall cease to be outstanding and interest shall cease
to accrue on such Note.

     SECTION 2.09 Temporary Notes. Pending the preparation of definitive Notes, the
Company may execute, and upon Company Order the Trustee shall authenticate and deliver, temporary
Notes which are printed, lithographed, typewritten, mimeographed or otherwise produced, in any
authorized denomination, substantially of the tenor of the definitive Notes in lieu of which they
are issued and with such appropriate insertions, omissions,

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substitutions and other variations as the officers executing such Notes may determine, as
conclusively evidenced by their execution of such Notes.

     If temporary Notes are issued, the Company will cause definitive Notes to be prepared without
unreasonable delay. After the preparation of definitive Notes, the temporary Notes shall be
exchangeable for definitive Notes upon surrender of the temporary Notes at the office or agency of
the Company designated for such purpose pursuant to Section 2.03, without charge to the Holder.
Upon surrender for cancellation of any one or more temporary Notes the Company shall execute and
the Trustee shall authenticate and deliver in exchange therefor a like principal amount of
definitive Notes of authorized denominations. Until so exchanged the temporary Notes shall in all
respects be entitled to the same benefits under this Indenture as definitive Notes.

     SECTION 2.10 Cancellation. All Notes surrendered for payment, repurchase by the
Company pursuant to Article 3, conversion, redemption or registration of transfer or exchange
shall, if surrendered to any person other than the Trustee, be delivered to the Trustee and shall
be promptly cancelled by it. The Company may at any time deliver to the Trustee for cancellation
any Notes previously authenticated and delivered hereunder which the Company may have acquired in
any manner whatsoever, and all Notes so delivered shall be promptly cancelled by the Trustee. The
Company may not issue new Notes to replace Notes it has paid or delivered to the Trustee for
cancellation or that any Holder has converted pursuant to Article 10. No Notes shall be
authenticated in lieu of or in exchange for any Notes cancelled as provided in this Section 2.10,
except as expressly permitted by this Indenture. All cancelled Notes held by the Trustee shall be
disposed of by the Company in accordance with its customary procedures.

     SECTION 2.11 Persons Deemed Owners. Prior to due presentment of a Note for
registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may
treat the Person in whose name such Note is registered as the owner of such Note for the purpose of
receiving payment of principal of the Note or the payment of any Provisional Redemption Price, or
Change in Control Repurchase Price in respect thereof, and interest thereon, for the purpose of
conversion and for all other purposes whatsoever, whether or not such Note be overdue, and neither
the Company, the Trustee nor any agent of the Company or the Trustee shall be affected by notice to
the contrary.

     SECTION 2.12 Global Notes.

     (a) Notwithstanding any other provisions of this Indenture or the Notes, (A) transfers of a
Global Note, in whole or in part, shall be made only in accordance with Section 2.06 and Section
2.12(a)(i), (B) transfer of a beneficial interest in a Global Note for a Certificated Note shall
comply with Section 2.06 and Section 2.12(a)(ii) below, and (C) transfers of a Certificated Note
shall comply with Section 2.06 and Sections 2.12(a)(iii) and (iv) below.

     (i) Transfer of Global Note. A Global Note may not be transferred, in whole or in
part, to any Person other than the Depositary or a nominee or any successor thereof, and no
such transfer to any such other Person may be registered; provided that this clause (i)
shall not prohibit any transfer of a Note that is issued in exchange for a Global Note

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but is not itself a Global Note. No transfer of a Note to any Person shall be
effective under this Indenture or the Notes unless and until such Note has been registered
in the name of such Person. Nothing in this Section 2.12(a)(i) shall prohibit or render
ineffective any transfer of a beneficial interest in a Global Note effected in accordance
with the other provisions of this Section 2.12(a).

     (ii) Restrictions on Transfer of a Beneficial Interest in a Global Note for a
Certificated Note. A beneficial interest in a Global Note may not be exchanged for a
Certificated Note except upon satisfaction of the requirements set forth below. Upon
receipt by the Trustee of a transfer of a beneficial interest in a Global Note (which
transfer, if made to an Institutional Accredited Investor that is not a QIB, shall be made
to a Holder that is acquiring a minimum of $250,000 aggregate principal amount of Notes) in
accordance with Applicable Procedures for a Certificated Note in the form satisfactory to
the Trustee, together with:

     (A) so long as the Notes are Restricted Notes, certification, in the
form set forth in Exhibit B-1 and, in the case of a transfer to an
Institutional Accredited Investor that is not a QIB, a representation letter
in the form set forth in Exhibit D;

     (B) written instructions to the Trustee to make, or direct the
Registrar to make, an adjustment on its books and records with respect to
such Global Note to reflect a decrease in the aggregate principal amount of
the Notes represented by the Global Note, such instructions to contain
information regarding the Depositary account to be credited with such
decrease; and

     (C) if the Company or Registrar so requests, an opinion of counsel or
other evidence reasonably satisfactory to them as to the compliance with the
restrictions set forth in the Legend,

then the Trustee shall cause, or direct the Registrar to cause, in accordance with the
standing instructions and procedures existing between the Depositary and the Registrar, the
aggregate principal amount of Notes represented by the Global Note to be decreased by the
aggregate principal amount of the Certificated Note to be issued, shall issue such
Certificated Note and shall debit or cause to be debited to the account of the Person
specified in such instructions a beneficial interest in the Global Note equal to the
principal amount of the Certificated Note so issued.

     (iii) Transfer and Exchange of Certificated Notes. When Certificated Notes are
presented to the Registrar with a request:

     (x) to register the transfer of such Certificated Notes; or

     (y) to exchange such Certificated Notes for an equal principal amount of
Certificated Notes of other authorized denominations,

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the Registrar shall register the transfer or make the exchange as requested if its
reasonable requirements for such transaction are met; provided, however, that the
Certificated Notes surrendered for transfer or exchange:

     (A) shall be duly endorsed or accompanied by a written instrument of
transfer in form reasonably satisfactory to the Company and the Registrar,
duly executed by the Holder thereof or his attorney duly authorized in
writing; and

     (B) so long as such Notes are Restricted Notes, such Notes are being
transferred or exchanged pursuant to an effective registration statement
under the Securities Act or pursuant to clause (1), (2) or (3) below, and
are accompanied by the following additional information and documents, as
applicable:

(1) if such Certificated Notes are being delivered to the
Registrar by a Holder for registration in the name of such
Holder, without transfer, a certification from such Holder to
that effect; or

(2) if such Certificated Notes are being transferred to the
Company, a certification to that effect; or

(3) if such Certificated Notes are being transferred pursuant
to an exemption from registration (including any transfer to
an Institutional Accredited Investor), (i) a certification to
that effect (in the form set forth in Exhibit B-1, if
applicable) and (ii) if the Company or Registrar so requests,
an opinion of counsel or other evidence reasonably
satisfactory to them as to the compliance with the
restrictions set forth in the Legend.

     (iv) Restrictions on Transfer of a Certificated Note for a Beneficial Interest in a
Global Note. A Certificated Note may not be exchanged for a beneficial interest in a Global
Note except upon satisfaction of the requirements set forth below, including any transfer
from an Institutional Accredited Investor that is not a QIB to a QIB.

Upon receipt by the Trustee of a Certificated Note, duly endorsed or accompanied by
appropriate instruments of transfer, in form reasonably satisfactory to the Trustee,
together with:

     (A) so long as the Notes are Restricted Notes, certification, in the
form set forth in Exhibit B-1, that such Certificated Note is being
transferred to a QIB in accordance with Rule 144A; and

     (B) written instructions directing the Trustee to make, or to direct
the Registrar to make, an adjustment on its books and records with respect
to such Global Note to reflect an increase in the aggregate

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principal amount of the Notes represented by the Global Note, such
instructions to contain information regarding the Depositary account to be
credited with such increase, then the Trustee shall cancel such Certificated
Note and cause, or direct the Registrar to cause, in accordance with the
standing instructions and procedures existing between the Depositary and the
Registrar, the aggregate principal amount of Notes represented by the Global
Note to be increased by the aggregate principal amount of the Certificated
Note to be exchanged, and shall credit or cause to be credited to the
account of the Person specified in such instructions a beneficial interest
in the Global Note equal to the principal amount of the Certificated Note so
cancelled. If no Global Notes are then outstanding, the Company shall issue
and the Trustee shall authenticate, upon written order of the Company in the
form of an Officers’ Certificate, a new Global Note in the appropriate
principal amount.

     (b) Subject to the succeeding paragraph, every Note shall be subject to the restrictions on
transfer provided in the Legend including the delivery of an opinion of counsel, if so provided.
Whenever any Restricted Note is presented or surrendered for registration of transfer or for
exchange for a Note registered in a name other than that of the Holder, such Note must be
accompanied by a certificate in substantially the form set forth in Exhibit B-1, dated the date of
such surrender and signed by the Holder of such Note, as to compliance with such restrictions on
transfer. The Registrar shall not be required to accept for such registration of transfer or
exchange any Note not so accompanied by a properly completed certificate.

     (c) The restrictions imposed by the Legend upon the transferability of any Note shall cease
and terminate when such Note has been sold pursuant to an effective registration statement under
the Securities Act or transferred in compliance with Rule 144 or, if earlier, upon the expiration
of the holding period applicable to sales thereof under Rule 144(k) promulgated under the
Securities Act (or any successor provision). Any Note as to which such restrictions on transfer
shall have expired in accordance with their terms or shall have terminated may, upon a surrender of
such Note for exchange to the Registrar in accordance with the provisions of this Section 2.12
(accompanied, in the event that such restrictions on transfer have terminated by reason of a
transfer in compliance with Rule 144, by an opinion of counsel having substantial experience in
practice under the Securities Act and otherwise reasonably acceptable to the Company, addressed to
the Company and in form acceptable to the Company, to the effect that the transfer of such Note has
been made in compliance with Rule 144), be exchanged for a new Note, of like tenor and aggregate
principal amount, which shall not bear the Legend. The Company shall inform the Trustee of the
effective date of any registration statement registering the Notes under the Securities Act. 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 Note (including any transfers between or among DTC participants,
members or beneficial owners in any Global Note) 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. The Trustee shall not be
liable for any action taken or omitted

24

 

to be taken by it in good faith in accordance with the aforementioned opinion of counsel or
registration statement.

     (d) In the event that Rule 144(k) as promulgated under the Securities Act is amended to
shorten the two-year restriction period, then restrictions on transfer on the Notes and the Common
Stock will be deemed to refer to the shortened restriction period. The Company undertakes to
inform the Trustee if such change to Rule 144(k) occurs and the effect (if any) to the restrictions
on transfer applicable to the Notes and Common Stock and shall provide additional information
(including an Opinion of Counsel and/or an Officers’ Certificate) if so requested by the Trustee.

     (e) As used in subsections (c) and (d) of this Section 2.12, the term “transfer” encompasses
any sale, pledge, transfer, hypothecation or other disposition of any Note.

     (f) The provisions of clauses (i), (ii), (iii), (iv) and (v) below shall apply only to Global
Notes:

     (i) Notwithstanding any other provisions of this Indenture or the Notes, except as
provided in Section 2.12(a)(i), a Global Note shall not be exchanged in whole or in part for
a Note registered in the name of any Person other than the Depositary or one or more
nominees thereof, provided that a Global Note may be exchanged for Notes registered in the
names of any person designated by the Depositary in the event that (i) the Depositary has
notified the Company that it is unwilling or unable to continue as Depositary for such
Global Note 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 or
(ii) an Event of Default has occurred and is continuing with respect to the Notes. Any
Global Note exchanged pursuant to clause (i) above shall be so exchanged in whole and not in
part, and any Global Note exchanged pursuant to clause (ii) above may be exchanged in whole
or from time to time in part as directed by the Depositary. Any Note issued in exchange for
a Global Note or any portion thereof shall be a Global Note; provided that any such Note so
issued that is registered in the name of a Person other than the Depositary or a nominee
thereof shall not be a Global Note.

     (ii) Subject to the last sentence of clause (i) above, notes issued in exchange for a
Global Note or any portion thereof shall be issued in definitive, fully registered form,
without interest coupons, shall have an aggregate principal amount equal to that of such
Global Note 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 the
applicable legends provided for herein. Any Global Note to be exchanged in whole shall be
surrendered by the Depositary to the Trustee, as Registrar. With regard to any Global Note
to be exchanged in part, either such Global Note 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 Note, 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 Note issuable on such exchange to or upon the order of the
Depositary or an authorized representative thereof.

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

     (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
Notes in definitive, fully registered form, without interest coupons.

     (v) Neither any members of, or participants in, the Depositary (collectively, the
“Agent Members”) nor any other Persons on whose behalf Agent Members may act shall have any
rights under this Indenture with respect to any Global Note registered in the name of the
Depositary or any nominee thereof, or under any such Global Note, 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 Note 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 Note.

          SECTION 2.13 CUSIP Numbers. The Company in issuing the Notes may use “CUSIP” numbers
and, if so, the Trustee shall use “CUSIP” numbers in notices of redemption as a convenience to
Holders; provided that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Notes or as contained in any notice of a
redemption and that reliance may be placed only on the other identification numbers printed on the
Notes, and any such redemption 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.

          SECTION 2.14 Defaulted Interest. If the Company defaults in a payment of interest on
the Notes, it shall pay, or shall deposit with the Paying Agent money in immediately available
funds sufficient to pay, the defaulted interest, plus (to the extent lawful) any interest payable
on the defaulted interest, to the Persons who are Holders on a subsequent special record date. A
special record date, as used in this Section 2.14 with respect to the payment of any defaulted
interest, shall mean the 15th day next preceding the date fixed by the Company for the payment of
defaulted interest, whether or not such day is a Business Day. At least 15 days before the
subsequent special record date, the Company shall mail to each Holder and to the Trustee a notice
that states the subsequent special record date, the payment date and the amount of defaulted
interest to be paid.

          SECTION 2.15 Registration Default. The interest rate borne by the Notes shall be
increased upon a Registration Default (as defined in the Registration Rights Agreement) due to the
incurrence of Liquidated Damages, as provided in the Registration Rights Agreement and the Notes.
If a Registration Default occurs, the Company shall deliver to the Trustee an

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Officers’ Certificate stating (1) the amount of increased interest payable in the form of
Liquidated Damages, (2) the date from which the increased Interest Rate resulting from the
Liquidated Damages is effective and (3) when such Liquidated Damages are payable. Unless and until
a Responsible Officer of the Trustee receives such an Officers’ Certificate, the Trustee shall
assume there has been no increase in the amount of interest.

ARTICLE 3

REDEMPTION AND REPURCHASES

     SECTION 3.01 Provisional Redemption. Commencing on or after October 15, 2007, the
Company may, at its option, redeem the Notes in whole at any time or in part on any date from time
to time, upon notice as set forth in Section 3.04, at a redemption price equal to 100% of the
principal amount of the Notes redeemed plus accrued and unpaid interest, if any (such amount, the
“Provisional Redemption Price”), to but excluding the date of redemption (“Provisional Redemption
Date”) (provided however, if such Provisional Redemption Date is an Interest Payment Date, the
interest due on such Interest Payment Date shall be payable to the Holder of the Notes called for
redemption registered as such on the relevant Record Date and the Provisional Redemption Price
shall not include such interest payment), if the Closing Price of the Common Stock has exceeded
150% of the Conversion Price then in effect for at least 20 Trading Days in the consecutive
30-Trading Day period ending on the Trading Day immediately preceding to the date of mailing of the
provisional notice of redemption pursuant to Section 3.04 (the “Notice Date”).

     SECTION 3.02 Notice of Trustee. If the Company elects to redeem Notes pursuant to the
redemption provisions of Section 3.01 hereof, it shall notify the Trustee at least 30 days prior
but not more than 60 days prior to the applicable Provisional Redemption Date of such intended
Provisional Redemption Date, the principal amount of Notes to be redeemed and the CUSIP numbers of
the Notes to be redeemed.

     SECTION 3.03 Selection of Notes to be Redeemed. If fewer than all the Notes are to be
redeemed, the Trustee shall select the particular Notes to be redeemed from the outstanding Notes
by a method that complies with the requirements of any exchange on which the Notes are listed, or,
if the Notes are not listed on an exchange, on a pro rata basis or by lot or in accordance with any
other method the Trustee considers fair and appropriate. Notes and portions thereof that the
Trustee selects shall be in principal amounts equal to whole multiples of no less than $1,000.

     If any Note selected for partial redemption is converted in part before termination of the
conversion right with respect to the portion of the Note so selected, the converted portion of such
Note shall be deemed to be the portion selected for redemption (provided, however, that the Holder
of such Note so converted and deemed redeemed shall not be entitled to any interest payment as a
result of such deemed redemption in excess of such interest as such Holder would have otherwise
been entitled to receive upon conversion of such Note). Notes that have been converted during a
selection of Notes to be redeemed may be treated by the Trustee as outstanding for the purpose of
such selection.

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     The Trustee shall promptly notify the Company and the Registrar in writing of the Notes
selected for redemption and, in the case of any Notes selected for partial redemption, the
principal amount thereof to be redeemed.

     For all purposes of this Indenture, unless the context otherwise requires, all provisions
relating to the redemption of Notes shall relate, in the case of any Notes redeemed or to be
redeemed only in part, to the portion of the principal amount of such Notes which has been or is to
be redeemed.

     SECTION 3.04 Notice of Redemption. Notice of redemption shall be given in the manner
provided in Section 13.02 hereof to the Holders of Notes to be redeemed. Such notice shall be
given not less than 30 nor more than 60 days prior to a Provisional Redemption Date for redemption
pursuant to Section 3.01.

     All notices of redemption shall state:

     (1) the Provisional Redemption Date;

     (2) the Provisional Redemption Price;

     (3) if fewer than all the outstanding Notes are to be redeemed, the aggregate principal
amount of Notes to be redeemed and the aggregate principal amount of Notes which will be
outstanding after such partial redemption;

     (4) that on the applicable Provisional Redemption Date the Provisional Redemption Price
will become due and payable upon each such Note to be redeemed, and that interest on the
Notes shall cease to accrue on and after such date;

     (5) the Conversion Price, the date on which the right to convert the principal of the
Notes to be redeemed will terminate and the places where such Notes may be surrendered for
conversion;

     (6) the place or places where such Notes are to be surrendered for payment of the
Provisional Redemption Price; and

     (7) the CUSIP number of the Notes.

     The notice given shall specify the last date on which exchanges or transfers of Notes may be
made pursuant to Section 2.06 hereof, and shall specify the serial numbers of Notes and the
portions thereof called for redemption.

     Notice of redemption of Notes to be redeemed at the election of the Company shall be given by
the Company.

     SECTION 3.05 Effect of Notice of Redemption. Notice of redemption having been given
as provided in Section 3.04 hereof, the Notes so to be redeemed shall, on the applicable
Provisional Redemption Date, become due and payable at the Provisional Redemption Price therein
specified and from and after such date (unless the Company shall default in the

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payment of the Provisional Redemption Price) such Notes shall cease to bear interest. Upon
surrender of any such Note for redemption in accordance with such notice, such Note shall be paid
by the Company at the Provisional Redemption Price; Provided, however, that the portion of the
Provisional Redemption Price comprising of interest on Notes whose Stated Maturity is prior to or
on the applicable Provisional Redemption Date shall be payable to the Holders of such Notes, or one
or more predecessor Notes, registered as such on the relevant Record Date according to their terms
and the provisions of Section 2.01 hereof.

     If any Note called for redemption shall not be so paid upon surrender thereof for redemption,
the principal shall, until paid, bear interest from the applicable Provisional Redemption Date at
the Interest Rate.

     SECTION 3.06 Deposit of Provisional Redemption Price. Prior to or on any Provisional
Redemption Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if the
Company or a Subsidiary or an Affiliate of either of them is acting as the Paying Agent, such
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 such Provisional Redemption Date) sufficient to pay the
Provisional Redemption Price of all the Notes to be redeemed on that Provisional Redemption Date,
other than any Notes called for redemption on that date which have been converted prior to the date
of such deposit (except with respect to the Provisional Redemption as provided in Sections 3.01 and
3.05 hereof).

     If any Note called for redemption is converted, any money deposited with the Trustee or with a
Paying Agent or so segregated and held in trust for the redemption of such Note shall (subject to
any right of the Holder of such Note or any predecessor Note to receive interest as provided in
Section 4.01 hereof) be paid to the Company on Company Request or, if then held by the Company,
shall be discharged from such trust.

     SECTION 3.07 Notes Redeemed in Part. Any Note which is to be redeemed only in part
shall be surrendered at an office or agency of the Company designated for that purpose pursuant to
Section 4.05 hereof (with, if the Company or the Trustee so requires, due endorsement by, or a
written instrument of transfer in form satisfactory to the Company and the Trustee duly executed
by, the Holder thereof or the Holder’s attorney duly authorized in writing), and the Company shall
execute, and the Trustee shall authenticate and deliver to the Holder of such Note without service
charge, a new Note or Notes of any authorized denomination as requested by such Holder in aggregate
principal amount equal to and in exchange for the unredeemed portion of the principal of the Note
so surrendered.

     SECTION 3.08 Conversion Arrangement on Call for Redemption. In connection with any
redemption of Notes, the Company may arrange for the purchase and conversion of any Notes called
for redemption by an agreement with one or more investment banks or other purchasers to purchase
such Notes by paying to the Trustee in trust for the Noteholders, on or prior to 11:00 a.m. New
York City time on the applicable Provisional Redemption Date, an amount that, together with any
amounts deposited with the Trustee by the Company for the redemption of such Notes, is not less
than the Provisional Redemption Price of such Notes. Notwithstanding anything to the contrary
contained in this Article 3, the obligation of the Company to pay the Provisional Redemption Price
of such Notes shall be deemed to be

29

 

satisfied and discharged to the extent such amount is so paid by such purchasers. If such an
agreement is entered into, any Notes not duly surrendered for conversion by the Holders thereof
may, at the option of the Company, be deemed, to the fullest extent permitted by law, acquired by
such purchasers from such Holders and (notwithstanding anything to the contrary contained in
Article 10) surrendered by such purchasers for conversion, all as of immediately prior to the close
of business on the applicable Provisional Redemption Date, subject to payment of the above amount
as aforesaid. The Trustee shall hold and pay to the Holders whose Notes are selected for
redemption any such amount paid to it for purchase and conversion in the same manner as it would
moneys deposited with it by the Company for the redemption of Notes. Without the Trustee’s prior
written consent, no arrangement between the Company and such purchasers for the purchase and
conversion of any Notes shall increase or otherwise affect any of the powers, duties,
responsibilities or obligations of the Trustee as set forth in this Indenture, and the Company
agrees to indemnify the Trustee from, and hold it harmless against, any loss, liability or expense
arising out of or in connection with any such arrangement for the purchase and conversion of any
Notes between the Company and such purchasers, including the costs and expenses incurred by the
Trustee in the defense of any claim or liability arising out of or in connection with the exercise
or performance of any of its powers, duties, responsibilities or obligations under this Indenture,
except to the extent such loss, liability, expense or cost results from Trustee’s gross negligence
or willful misconduct.

     SECTION 3.09 Reserved.

     SECTION 3.10 Repurchase of Notes at Option of the Holder upon Change in Control. 

     (a) If there shall have occurred a Change in Control, all or any portion of the Notes of any
Holder equal to a whole multiple of $1,000, not previously called for redemption, shall be
repurchased by the Company, at the option of such Holder, at a repurchase price equal to 100% of
the principal amount of the Notes to be repurchased, together with interest accrued and unpaid to,
but excluding, the repurchase date (the “Change in Control Repurchase Price”), on the date (the
“Change in Control Repurchase Date”) that is 45 Business Days after the Change in Control
Repurchase Notice; provided, however, that installments of interest on Notes whose Stated Maturity
is prior to or on the Change in Control Repurchase Date shall be payable to the Holders of such
Notes, or one or more predecessor Notes, registered as such on the relevant Regular Record Date
according to their terms.

     Subject to the fulfillment by the Company of the conditions set forth in Section 3.10(b)
hereof, the Company may elect to pay the Change in Control Repurchase Price (to the extent not paid
in cash) by delivering the number of shares of Common Stock equal to (i) the Change in Control
Repurchase Price divided by (ii) 95% of the average of the Closing Prices per share of Common Stock
for the five consecutive Trading Days immediately preceding and including the third Trading Day
prior to the Change in Control Repurchase Date.

     Whenever in this Indenture (including Sections 2.01, 6.01(a) and 6.07 hereof) or Exhibits A-1
and A-2 annexed hereto there is a reference, in any context, to the principal of any Note as of any
time, such reference shall be deemed to include reference to the Change in Control Repurchase Price
payable in respect to such Note to the extent that such Change in

30

 

Control Repurchase Price is, was or would be so payable at such time, and express mention of
the Change in Control Repurchase Price in any provision of this Indenture shall not be construed as
excluding the Change in Control Repurchase Price in those provisions of this Indenture when such
express mention is not made.

        A “Change in Control” of the Company shall be deemed to have occurred at such time after the
original issuance of Notes as any of the following events shall occur:

     (i) the acquisition by any person, including any syndicate or group deemed to be a
“person” under Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), of beneficial ownership, directly or indirectly, through a purchase, merger
or other acquisition transaction or series of transactions, of shares of the Capital Stock
of the Company entitling that person to exercise 50% or more of the total voting power of
all shares of such Capital Stock entitled to vote generally in elections of directors, other
than any acquisition by the Company, any of its Subsidiaries or any employee benefit plans
of the Company; or

     (ii) any consolidation or merger of the Company with or into any other person, any
merger of another person into the Company, 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:

     (A) any transaction (1) that does not result in any reclassification,
conversion, exchange or cancellation of outstanding shares of the Capital
Stock of the Company and (2) pursuant to which holders of the Capital Stock
of the Company immediately prior to the transaction are entitled to
exercise, directly or indirectly, 50% or more of the total voting power of
all shares of the Capital Stock of the Company entitled to vote generally in
the election 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) during any consecutive two-year period, individuals who at the beginning of that
two-year period constituted the Board of Directors (together with any new directors whose
election to the Board of Directors, or whose nomination for election by the stockholders of
the Company, was approved by a vote of a majority of the directors then still in office who
were either directors at the beginning of such period or whose election or nomination for
election were previously so approved) cease for any reason to constitute a majority of the
Board of Directors then in office; or

     (iv) the Company is liquidated or dissolved or a resolution is passed by the Company’s
stockholders approving a plan of liquidation or dissolution of the Company

31

 

other than in a transaction that complies with the provisions described in Article 5 of
the Indenture.

Beneficial ownership shall be determined in accordance with Rule 13d-3 promulgated by the
Commission under the Exchange Act. The term “person” shall include any syndicate or group that
would be deemed to be a “person” under Section 13(d)(3) of the Exchange Act.

          (b) Unless the Company shall have theretofore called for redemption all of the outstanding
Notes, prior to or on the 30th day after the occurrence of a Change in Control, the Company, or, at
the written request and expense of the Company prior to or on the 30th day after such occurrence,
the Trustee, shall give to all Noteholders, in the manner provided in Section 13.02 hereof, notice
of the occurrence of the Change in Control and of the repurchase right set forth herein arising as
a result thereof (the “Company Change in Control Notice”). The Company shall also deliver a copy
of such Company Change in Control Notice to the Trustee. The notice shall include a form of Change
in Control Repurchase Notice (as defined in Section 3.10(c)) to be completed by the Noteholder and
shall state:

     (1) briefly, the events causing a Change in Control and the date of such Change in
Control;

     (2) the date by which the Change in Control Repurchase Notice pursuant to this Section
3.10 must be given;

     (3) the Change in Control Repurchase Date;

     (4) the Change in Control Repurchase Price;

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

     (6) the Conversion Price and any adjustments thereto;

     (7) that Notes as to which a Change in Control Repurchase Notice has been given may be
converted pursuant to Article 10 hereof and paragraph 9 on the reverse side of the Notes
only if the Change in Control Repurchase Notice has been withdrawn in accordance with the
terms of this Indenture;

     (8) that Notes must be surrendered to the Paying Agent to collect payment;

     (9) that the Change in Control Repurchase Price for any Note as to which a Change in
Control Repurchase Notice has been duly given and not withdrawn will be paid promptly
following the later of the Change in Control Repurchase Date and the time of surrender of
such Note as described in (8) above;

     (10) briefly, the procedures the Holder must follow to exercise rights under this
Section 3.10;

     (11) briefly, the conversion rights of the Notes;

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     (12) the procedures for withdrawing a Change in Control Repurchase Notice;

     (13) that, unless the Company defaults in making payment on Notes for which a Change in
Control Repurchase Notice has been submitted, interest on such Notes will cease to accrue on
and after the Change in Control Repurchase Date;

     (14) the CUSIP number of the Notes; and

     (15) whether the Change in Control Repurchase Price shall be paid by the Company in
cash or by delivery of shares of Common Stock or a combination thereof, and if a
combination thereof, such notice shall provide the proportion of cash and Common Stock.

          If any of the Notes to be redeemed are in the form of a Global Note, the Company shall modify
such notice to the extent necessary to accord with the procedures of the Depositary applicable to
repurchases.

          At the Company’s request, the Trustee shall give such Company Change in Control Notice on
behalf of the Company and at the Company’s expense; provided, however, that, in all cases, the text
of such Company Change in Control Notice shall be prepared by the Company.

          (c) Purchases of Notes by the Company pursuant to Section 3.10(a) hereof shall be made, at the
option of the Holder thereof, upon:

     (1) delivery to the Paying Agent by the Holder of a written notice of repurchase in the
form set forth in Exhibit C attached hereto (a “Change in Control Repurchase Notice”) on or
prior to the 45th day after the date of the Company Change in Control Notice
pursuant to 3.10(b) above, stating:

     (i) the certificate number of the Note which the Holder will deliver to be repurchased
(or if the Notes are not certificated, the Change in Control Repurchase Notice must comply
with the procedures of the Depositary applicable to repurchases);

     (ii) the portion of the principal amount of the Note which the Holder will deliver to
be repurchased, which portion must be $1,000 or any whole multiple thereof;

     (iii) that such Note shall be repurchased pursuant to the terms and conditions
specified in paragraph 8 on the reverse side of the Notes; and

     (iv) if that the Company elects, pursuant to the Section 3.10(d), to pay the Change in
Control Repurchase Price to be paid as of such Change in Control Repurchase Date, in whole
or in part, in shares of Common Stock but such portion of the Change in Control Repurchase
Price shall ultimately be payable to such Holder entirely in cash because any condition to
payment of the Change in Control Repurchase Price (or a portion thereof) in Common Stock is
not satisfied prior to the close of business on the Business Day immediately preceding such
Repurchase Date, as set forth in Section 3.10(f), whether such Holder elects (i) to withdraw
such Change in Control Repurchase

33

 

Notice as to some or all of the Notes to which such Change in Control Repurchase Notice
relates (stating the principal amount and certificate numbers of the Notes as to which such
withdrawal shall relate), or (ii) to receive cash in respect of the entire Change in Control
Repurchase Price for all Notes (or portion thereof) to which such Change in Control
Repurchase Price relates.

     (2) delivery of such Note to the Paying Agent prior to, on or after the Change in
Control Repurchase Date (together with all necessary endorsements) at the offices of the
Paying Agent (if the Notes are not certificated, such delivery must comply with the
procedures of the Depositary applicable to repurchases) shall be a condition to the receipt
by the Holder of the Change in Control Repurchase Price therefor. The Change in Control
Repurchase Price shall be so paid pursuant to this Section 3.10 only if the Note so
delivered to the Paying Agent shall conform in all respects to the description thereof in
the related Change in Control Repurchase Notice, as determined by the Company.

          If a Holder, in such Holder’s Change in Control Repurchase Notice and in any written notice of
withdrawal delivered by such Holder pursuant to the terms of Section 3.10(c)(1), fails to indicate
such Holder’s choice with respect to the election set forth in clause (iv) of Section 3.10(c)(1),
such Holder shall be deemed to have elected to receive cash in respect of the Change in Control
Repurchase Price for all Notes subject to Change in Control Notice in the circumstances set forth
in such clause (iv).

          Notwithstanding anything herein to the contrary, any Holder delivering to the Paying Agent the
Change in Control Repurchase Notice contemplated by this Section 3.10(c) shall have the right to
withdraw such Change in Control Repurchase Notice at any time prior to the close of business on the
Change in Control Repurchase Date by delivery of a written notice of withdrawal to the Paying Agent
in accordance with Section 3.11.

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

          (d) The Notes to be purchased pursuant to Section 3.10(a) may be paid for, at the election of
the Company, in cash or Common Stock, or in any combination of cash and Common Stock, subject to
the conditions set forth in Sections 3.10(e) and (f). The Company shall designate, in the Company
Change in Control Notice delivered pursuant to Section 3.10(b), whether the Company will repurchase
the Notes for cash or Common Stock, or, if a combination thereof, the percentages of the Change in
Control Repurchase Price of Notes in respect of which it will pay in cash or Common Stock; provided
that the Company will pay cash for fractional interests in Common Stock. For purposes of
determining the existence of potential fractional interests, all Notes subject to repurchase by the
Company held by a Holder shall be considered together (no matter how many separate certificates are
to be presented). Each Holder whose Notes are purchased pursuant to this Section 3.10 shall
receive the same percentage of cash or Common Stock in payment of the Change in Control Price for
such Notes, except (i) as provided in Section 3.10(f) with regard to the payment of cash in lieu of
fractional shares of Common Stock and (ii) in the event that the Company is unable to repurchase
the Notes of a Holder or Holders for Common Stock because any of the conditions specified in
Section 3.10(f) have not been satisfied, the Company, subject to such Holder’s or Holders’ election
under Section

34

 

3.10(c)(1)(iv) to withdraw its Change in Control Repurchase Notice, may repurchase the Notes
of such Holder or Holders for cash. The Company may not change its election with respect to the
consideration (or components or percentages of components thereof) to be paid once the Company has
given its Company Change in Control Notice to Holders except pursuant to this Section 3.10(b) or
pursuant to Section 3.10(f) in the event of a failure to satisfy, prior to the close of business on
the Change in Control Repurchase Date, any condition to the payment of the Change in Control
Repurchase Price, in whole or in part, in Common Stock.

     At least three Business Days before the date on which the Company provides its Company Change
in Control Notice, the Company shall deliver an Officers’ Certificate to the Trustee specifying:

     (i) the manner of payment selected by the Company,

     (ii) the information required by Section 3.10(b),

     (iii) if the Company elects to pay the Repurchase Price, or a specified percentage
thereof, in Common Stock, that the conditions to such manner of payment set forth in Section
3.10(f) have been or will be complied with, and

     (iv) whether the Company desires the Trustee to give the Company Change in Control
Notice required by Section 3.10(b).

     (e) On the date as provided in Section 3.12, at the option of the Company, as specified in the
Change in Control Repurchase Notice or if the conditions in Section 3.10(f) have not been met, the
Change in Control Repurchase Price of Notes in respect of which a Change in Control Repurchase
Notice pursuant to Section 3.10(c) has been given, or a specified percentage thereof, may be paid
by the Company with cash equal to the aggregate Change in Control Repurchase Price of such Notes.
If the Company elects to repurchase Notes with cash, the Company Change in Control Notice, as
provided in Section 3.10(b), shall be sent to Holders (and to beneficial owners as required by
applicable law) not less than 20 Business Days prior to such Change in Control Repurchase Date.

     (f) On the date as provided in Section 3.12, at the option of the Company, as specified in the
Change in Control Repurchase Notice, subject to satisfaction of the conditions set forth in this
Section 3.10(f), the Change in Control Repurchase Price of Notes in respect of which a Change in
Control Repurchase Notice pursuant to Section 3.10(c) has been given, or a specified percentage
thereof, may be paid by the Company by the issuance of a number of shares of Common Stock equal to
the quotient obtained by dividing (i) the amount of cash to which the Holders would have been
entitled had the Company elected to pay all or such specified percentage, as the case may be, of
the Change in Control Repurchase Price of such Notes in cash by (ii) 95% of the average of the
Closing Prices per share of Common Stock for the five consecutive Trading Days immediately
preceding and including the third Trading Day prior to the Change in Control Repurchase Date,
subject to the next succeeding paragraph.

     The Company will not issue a fractional share of Common Stock in payment of the Change in
Control Repurchase Price. Instead the Company will pay cash for the value of the

35

 

fractional share. The value of a fraction of a share shall be determined by multiplying (i) 95% of
the average of the Closing Prices per share of Common Stock for the five consecutive Trading Days
immediately preceding and including the third Trading Day prior to the Change in Control Repurchase
Date by (ii) such fraction and rounding the product to the nearest whole cent. It is understood
that if a Holder elects to have more than one Note purchased, the number of shares of Common Stock
shall be based on the aggregate amount of Notes to be purchased.

     Upon the delivery by the Company to the Holders of the full number of the shares of Common
Stock into which the Notes are convertible, together with cash payment, if any, for the cash
portion of the Change in Control Repurchase Price or the Holders’ fractional shares, the obligation
of the Company to pay the principal amount of the Notes and any accrued and unpaid interest thereon
shall be deemed satisfied. Accrued and unpaid interest shall be deemed paid in full rather than
cancelled, extinguished or forfeited.

     The Company’s right to exercise its election to repurchase the Notes pursuant to Section 3.10
through the issuance of shares of Common Stock shall be conditioned upon:

     (i) The shares of Common Stock to be issued upon repurchase of Notes hereunder:

     (A) shall not require registration under any federal securities law
before such shares may be freely transferable without being subject to any
transfer restrictions under the Securities Act upon repurchase or, if such
registration is required, such registration shall be completed and shall
become effective prior to the Change in Control Repurchase Date; and

     (B) shall not require registration with, or approval of, any
governmental authority under any state law or any other federal law before
            shares may be validly issued or delivered upon repurchase or if such
registration is required or such approval must be obtained, such
registration shall be completed or such approval shall be obtained prior to
the Change in Control Repurchase Date.

     (ii) The shares of Common Stock to be listed upon repurchase of Notes hereunder are, or
shall have been, approved for listing on the Nasdaq National Market or the New York Stock
Exchange or listed on another national securities exchange, in any case, prior to the Change
in Control Repurchase Date.

     (iii) All shares of Common Stock which may be issued upon repurchase of Notes will be
issued out of the Company’s authorized but unissued Common Stock and will, upon issue, be
duly and validly issued and fully paid and nonassessable and free of any preemptive or
similar rights.

     If any of the conditions set forth in clauses (i) through (iii) of this Section 3.10(f) are
not satisfied in accordance with the terms thereof, the Change in Control Repurchase Price shall be
paid by the Company only in cash.

36

 

     (g) The Company shall repurchase from the Holder thereof, pursuant to this Section 3.10, a
portion of a Note if the principal amount of such portion is $1,000 or a whole multiple of $1,000.
Provisions of this Indenture that apply to the repurchase of all of a Note also apply to the
repurchase of such portion of such Note.

     (h) The Company shall deposit cash (in respect of a cash repurchase under Section 3.10(e) or
for fractional interests, as applicable) or shares of Common Stock, or a combination thereof, as
applicable, at the time and in the manner as provided in Section 3.12, sufficient to pay the
aggregate Change in Control Repurchase Price of all Notes to be purchased pursuant to this Section
3.10. As soon as practicable after the Change in Control Repurchase Date, the Company shall
deliver to each Holder entitled to receive Common Stock through the Paying Agent, a certificate for
the number of full shares of Common Stock issuable in payment of the Change in Control Repurchase
Price and cash in lieu of any fractional interests. The person in whose name the certificate for
Common Stock is registered shall be treated as a holder of record of shares of Common Stock on the
Business Day following the Repurchase Date. No payment or adjustment will be made for dividends on
the Common Stock the record date for which occurred on or prior to the Change in Control Repurchase
Date.

     (i) If a Holder of a Note is paid in Common Stock, the Company shall pay any documentary,
stamp or similar issue or transfer tax due on such issue of shares of Common Stock. However, the
Holder shall pay any such tax which is due because the Holder requests the shares of Common Stock
to be issued in a name other than the Holder’s name. The Paying Agent may refuse to deliver the
certificates representing the Common Stock being issued in a name other than the Holder’s name
until the Paying Agent receives a sum sufficient to pay any tax which will be due because the
shares of Common Stock are to be issued in a name other than the Holder’s name. Nothing herein
shall preclude any income tax withholding required by law or regulations.

     SECTION 3.11 Effect of Change in Control Repurchase Notice. Upon receipt by the
Paying Agent of the Change in Control Repurchase Notice specified in Section 3.10(c), the Holder of
the Note in respect of which such Change in Control Repurchase Notice was given shall (unless such
Change in Control Repurchase Notice is withdrawn as specified in the following two paragraphs)
thereafter be entitled to receive solely the Change in Control Repurchase Price with respect to
such Note. Such Change in Control Repurchase Price shall be paid to such Holder, subject to
receipt of consideration for the Notes and/or Notes from the Holders by the Paying Agent, promptly
following the later of (x) the Change in Control Repurchase Date with respect to such Note
(provided the conditions in Section 3.10(c) have been satisfied) and (y) the time of delivery of
such Note to the Paying Agent by the Holder thereof in the manner required by Section 3.10(c).
Notes in respect of which a Change in Control Repurchase Notice has been given by the Holder
thereof may not be converted pursuant to Article 10 hereof on or after the date of the delivery of
such Change in Control Repurchase Notice unless such Change in Control Repurchase Notice has first
been validly withdrawn as specified in the following two paragraphs.

     A Change in Control Repurchase Notice may be withdrawn by means of a written notice of
withdrawal delivered to the office of the Paying Agent in accordance with the Change

37

 

in Control Repurchase Notice at any time prior to the close of business on the Change in
Control Repurchase Date, specifying:

     (1) the certificate number of the Note in respect of which such notice of withdrawal is
being submitted (or, if the Notes are not certificated, the withdrawal notice must contain
information required to comply with appropriate DTC procedures),

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

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

          There shall be no repurchase of any Notes pursuant to Section 3.10, if there has occurred
(prior to, on or after, as the case may be, the giving, by the Holders of such Notes, of the
required Change in Control Repurchase Notice) and is continuing an Event of Default (other than a
default in the payment of the Change in Control Repurchase Price with respect to such Notes). The
Paying Agent will promptly return to the respective Holders thereof any Notes (x) with respect to
which a Change in Control Repurchase Notice has been withdrawn in compliance with this Indenture,
or (y) held by it during the continuance of an Event of Default (other than a default in the
payment of the Change in Control Repurchase Price with respect to such Notes) in which case, upon
such return, the Change in Control Repurchase Notice with respect thereto shall be deemed to have
been withdrawn.

          SECTION 3.12 Deposit of Change in Control Repurchase Price. Prior to 11:00 a.m. (New
York City time) on the Business Day following the Change in Control Repurchase Date the Company
shall deposit with the Trustee or with the Paying Agent (or, if the Company or a Subsidiary or an
Affiliate of either of them is acting as the Paying Agent, shall segregate and hold in trust as
provided in Section 2.04) an amount of money (in immediately available funds if deposited on such
Business Day) or Common Stock, or a combination thereof, if permitted hereunder, sufficient to pay
the aggregate Change in Control Repurchase Price of all the Notes or portions thereof which are to
be repurchased as of the Change in Control Repurchase Date. The manner in which the deposit
required by this Section 3.12 is made by the Company shall be at the option of the Company.

          SECTION 3.13 Notes Repurchased in Part. Any Note which is to be repurchased only in
part shall be surrendered at the office of the Paying Agent (with, if the Company or the Trustee so
requires, due endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or such Holder’s attorney duly
authorized in writing) and the Company shall execute and the Trustee shall authenticate and deliver
to the Holder of such Note, without service charge, a new Note or Notes, of any authorized
denomination as requested by such Holder in aggregate principal amount equal to, and in exchange
for, the portion of the principal amount of the Note so surrendered which is not repurchased.

38

 

     SECTION 3.14 Covenant to Comply with Securities Laws upon Purchase or Repurchase of
Notes. In connection with any offer to purchase or repurchase of Notes under Section 3.10
hereof (provided that such offer or purchase constitutes an “issuer tender offer” for purposes of
Rule 13e-4 (which term, as used herein, includes any successor provision thereto) under the
Exchange Act at the time of such offer or purchase), the Company shall (i) comply with Rule 13e-4,
Rule 14e-1 and any other tender offer rules under the Exchange Act which may then be applicable,
(ii) file the related Schedule TO (or any successor schedule, form or report) or any other schedule
required under the Exchange Act, and (iii) otherwise comply with all federal and state securities
laws so as to permit the rights and obligations under Section 3.10 to be exercised in the time and
in the manner specified in Section 3.10.

     SECTION 3.15 Repayment to the Company. The Trustee and the Paying Agent shall return
to the Company any cash or shares of Common Stock that remain unclaimed as provided in paragraph 13
on the reverse side of the Notes, together with interest or dividends, if any, thereon, held by
them for the payment of the Change in Control Repurchase Price; provided, however, that to the
extent that the aggregate amount of cash or shares of Common Stock deposited by the Company
pursuant to Section 3.12 exceeds the aggregate Change in Control Repurchase Price of the Notes or
portions thereof which the Company is obligated to repurchase as of the Change in Control
Repurchase Date then promptly after the Business Day following the Change in Control Repurchase
Date, the Trustee shall return any such excess to the Company together with interest or dividends,
if any, thereon.

ARTICLE 4

COVENANTS

     SECTION 4.01 Payment of Principal and Interest on the Notes. The Company will duly
and punctually pay the principal of and interest at the Interest Rate in respect of the Notes in
accordance with the terms of the Notes and this Indenture. The Company will deposit or cause to be
deposited with the Trustee as directed by the Trustee, no later than 11:00 a.m., New York time on
the day of the Stated Maturity of any Note or installment of interest, all payments so due.
Principal amount, Provisional Redemption Price, Change in Control Repurchase Price, and interest
shall be considered paid on the applicable date due if at 11:00 a.m., New York time on such date
(or, in the case of a Change in Control Repurchase Price, on the Business Day following the
applicable Change in Control Repurchase Date). the Trustee or the Paying Agent holds, in
accordance with this Indenture, money or Common Stock, if permitted hereunder, sufficient to pay
all such amounts then due.

     The Company shall, to the extent permitted by law, pay cash interest on overdue amounts at the
rate per annum set forth in paragraph 1 on the reverse side of the Notes, 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
overdue interest shall be payable on demand.

     SECTION 4.02 Commission and Other Reports. The Company shall file with the Trustee,
within 15 days after it files such annual and quarterly reports, information, documents and other
reports with the Commission, copies of its annual report and of the

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information, documents and other reports (or copies of such portions of any of the foregoing
as the Commission may by rules and regulations prescribe) which the Company is required to file
with the Commission pursuant to Section 13 or 15(d) of the Exchange Act. If at any time the
Company is not subject to Section 13 or 15(d) of the Exchange Act, such reports shall 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 other provisions of TIA
Section 314(a).

     SECTION 4.03 Compliance Certificate. The Company shall deliver to the Trustee within
120 days after the end of each fiscal year of the Company (beginning with the fiscal year ending on
April 30, 2007) an Officers’ Certificate, stating whether or not to the best knowledge of the
signers thereof the Company is in default in the performance and observance of any of the terms,
provisions and conditions of this Indenture (without regard to any period of grace or requirement
of notice provided hereunder) and if the Company shall be in default, specifying all such defaults
and the nature and status thereof of which they may have knowledge.

     SECTION 4.04 Further Instruments and Acts. Upon request of the Trustee, the Company
will execute and deliver such further instruments and do such further acts as may be reasonably
necessary or proper to carry out more effectively the purposes of this Indenture.

     SECTION 4.05 Maintenance of Office or Agency. The Company will maintain in the
Borough of Manhattan, the City of New York, an office or agency of the Trustee, Registrar, Paying
Agent and Conversion Agent where Notes may be presented or surrendered for payment, where Notes may
be surrendered for registration of transfer, exchange, repurchase, redemption or conversion and
where notices and demands to or upon the Company in respect of the Notes and this Indenture may be
served. The office of U.S. Bank Trust National Association, located at 100 Wall Street,
16th Floor, New York, New York, 10005, attention: Corporate Trust Administration, shall
initially be 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 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 Notes 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 in the Borough of
Manhattan, the City of New York, for such purposes.

     SECTION 4.06 Delivery of Certain Information. At any time when the Company is not
subject to Section 13 or 15(d) of the Exchange Act, upon the request of a Holder or any beneficial
holder of Notes or shares of Common Stock issued upon conversion thereof, the Company will promptly
furnish or cause to be furnished Rule 144A Information (as defined below) to such Holder or any
beneficial holder of Notes or holder of shares of Common Stock issued upon conversion of Notes, or
to a prospective purchaser of any such security designated by any such holder, as the case may be,
to the extent required to permit compliance by such

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Holder or holder with Rule 144A in connection with the resale of any such security. “Rule
144A Information” shall be such information as is specified pursuant to Rule 144A(d)(4) under the
Securities Act.

ARTICLE 5

SUCCESSOR CORPORATION

          SECTION 5.01 When Company May Merge or Transfer Assets. The Company shall not,
subject to Section 9.02 hereof, consolidate with, merge into or transfer or lease all or
substantially all of its assets to any corporation, limited liability company, partnership or trust
organized under the laws of the United States or any of its political subdivisions, unless:

     (a) either (1) the Company shall be the resulting or surviving corporation or (2) 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 the properties and
assets of the Company substantially as an entirety (i) shall be organized and validly
existing under the laws of the United States or any state of the United States and (ii)
shall expressly assume, by an indenture supplemental hereto, executed and delivered to the
Trustee, in form reasonably satisfactory to the Trustee, all of the obligations of the
Company under the Notes and this Indenture;

     (b) at the time of such transaction, no Event of Default and no event which, after
notice or lapse of time, would become an Event of Default, shall have happened and be
continuing; and

     (c) the Company shall have delivered to the Trustee an Officers’ Certificate and an
Opinion of Counsel, each stating that such consolidation, merger, conveyance, transfer or
lease and, if a supplemental indenture is required in connection with such transaction, such
supplemental indenture, comply with this Article 5 and that all conditions precedent herein
provided for relating to such transaction have been satisfied.

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

          The successor person formed by such consolidation or into which the Company is merged or the
successor person 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 had been named as the Company herein; and thereafter, except
in the case of a lease and obligations the Company may have under a supplemental indenture pursuant
to Section 10.11, the Company shall be discharged from all obligations and covenants under this
Indenture and the Notes. Subject to Section 9.06, the Company, the Trustee and the successor
person shall enter into a supplemental indenture to

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evidence the succession and substitution of such successor person and such discharge and
release of the Company.

ARTICLE 6

DEFAULTS AND REMEDIES

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

     (1) the Company fails to pay when due the principal of any of the Notes at the
scheduled maturity, upon redemption or exercise of a repurchase right or otherwise, whether
or not such payment is prohibited by Article 11 of this Indenture;

     (2) the Company fails to pay an installment of interest, including Liquidated Damages,
if any, on any of the Notes that continues for 30 days after the date when due, whether or
not such payment is prohibited by Article 11 of this Indenture;

     (3) the Company fails to deliver all cash and any shares of Common Stock when such cash
and Common Stock, if any, are required to be delivered upon conversion of a Note and such
failure continues for 10 days after such delivery date;

     (4) the Company fails to perform or observe any other term, covenant or agreement
contained in the Notes or this Indenture for a period of 60 days after receipt by the
Company of a Notice of Default (as defined in this Section 6.01);

     (5) (A) one or more defaults in the payment of the Company’s Indebtedness aggregating
$5.0 million or more at the scheduled maturity thereof, and such default or defaults shall
have continued after any applicable grace period and shall not have been cured or waived
within a 30-day period after the date of a Notice of Default or (B) any of the Company’s
Indebtedness aggregating $5.0 million or more shall have been accelerated or otherwise
declared due and payable, or required to be prepaid or repurchased (other than by regularly
scheduled required prepayment) prior to the scheduled maturity thereof, due to a default of
such Indebtedness and such Indebtedness is not discharged nor such acceleration is cured,
waived, rescinded or annulled within a 30-day period after a Notice of Default;

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

     (A) commences a voluntary case or proceeding;

     (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 Custodian of it or for any
substantial part of its property;

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     (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 Custodian; or

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

     (A) is for relief against the Company or any Significant Subsidiary in
an involuntary case or proceeding, or adjudicates the Company or any
Significant Subsidiary insolvent or bankrupt;

     (B) appoints a Custodian of the Company or any Significant Subsidiary
or for any substantial part of its or their properties; or

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

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

         “Bankruptcy Law” means Title 11, United States Code, or any similar federal or
state law for the relief of debtors.

         “Custodian” means any receiver, trustee, assignee, liquidator, custodian or
similar official under any Bankruptcy Law.

               A Default under clause (4) or (5) above is not an Event of Default until the Trustee notifies
the Company, or the Holders of at least 25% in aggregate principal amount of the Notes at the time
outstanding notify the Company and the Trustee, of the Default and the Company does not cure such
Default (and such Default is not waived) within the time specified in clause (4) or (5) above after
actual receipt of such notice. Any such notice must specify the Default, demand that it be
remedied and state that such notice is a “Notice of Default”.

               The Company will deliver to the Trustee, within five Business Days of becoming aware of the
occurrence of an Event of Default, written notice thereof. In addition, the Company shall deliver
to the Trustee, within 30 days after it becomes aware of the occurrence thereof, written notice of
any event which with the lapse of time would become an Event of Default under clause (4) or (5)
above, its status and what action the Company is taking or proposes to take with respect thereto.

               SECTION 6.02 Acceleration. If an Event of Default (other than an Event of Default
specified in Section 6.01(6) or (7)) occurs and is continuing, the Trustee by notice to the
Company, or the Holders of at least 25% in aggregate principal amount of the Notes at the time
outstanding by notice to the Company and the Trustee, may declare the Notes due and payable at
their principal amount together with accrued interest. Upon a declaration of

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acceleration, such principal and accrued and unpaid interest to the date of payment shall be
immediately due and payable.

     If an Event of Default specified in Section 6.01(6) or (7) above occurs and is continuing,
then the principal and the interest on all the Notes shall become and be immediately due and
payable without any declaration or other act on the part of the Trustee or any Noteholders.

     The Holders of a majority in aggregate principal amount of the Notes at the time outstanding,
by notice to the Trustee (and without notice to any other Noteholder) may rescind or annul an
acceleration and its consequences if the rescission would not conflict with any judgment or decree
and if all existing Events of Default have been cured or waived except nonpayment of the principal
and any accrued cash interest that have become due solely as a result of acceleration and if all
amounts due to the Trustee under Section 7.06 have been paid. No such rescission shall affect any
subsequent Default or impair any right consequent thereto.

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

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

     SECTION 6.04 Waiver of Past Defaults. The Holders of a majority in aggregate
principal amount of the Notes at the time outstanding, by notice to the Trustee (and without notice
to any other Noteholder), may waive by means of written consent an existing Default and its
consequences except (1) an Event of Default described in Section 6.01(1) or (2), (2) a Default in
respect of a provision that under Section 9.02 cannot be amended without the consent of each
Noteholder affected or (3) a Default which constitutes a failure to convert any Note in accordance
with the terms of Article 10. When a Default is waived, it is deemed cured, but no such waiver
shall extend to any subsequent or other Default or impair any consequent right. This Section 6.04
shall be in lieu of Section 316(a)1(B) of the TIA and such Section 316(a)1(B) is hereby expressly
excluded from this Indenture, as permitted by the TIA.

     SECTION 6.05 Control by Majority. The Holders of a majority in aggregate principal
amount of the Notes at the time outstanding through their written consent may direct the time,
method and place of conducting any proceeding for any remedy available to the Trustee or of
exercising any trust or power conferred on the Trustee. However, the Trustee may refuse to follow
any direction that conflicts with law or this Indenture or that the Trustee determines in good
faith is unduly prejudicial to the rights of other Noteholders or would involve the Trustee in
personal liability unless the Trustee is offered indemnity reasonably satisfactory to it against
loss, liability or expense. This Section 6.05 shall be in lieu of Section 316(a)1(A) of

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the TIA and such Section 316(a)1(A) is hereby expressly excluded from this Indenture, as
permitted by the TIA.

          SECTION 6.06 Limitation on Suits. A Noteholder may not pursue any remedy with respect
to this Indenture or the Notes unless:

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

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

     (3) such Holder or Holders offer to the Trustee reasonable security or indemnity
satisfactory to the Trustee against any loss, liability or expense;

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

     (5) the Holders of a majority in aggregate principal amount of the Notes at the time
outstanding do not give the Trustee a direction inconsistent with the request during such
60-day period.

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

          SECTION 6.07 Rights of Holders to Receive Payment. Notwithstanding any other
provision of this Indenture, the right of any Holder to receive payment of the principal amount
plus Provisional Redemption Price, Change in Control Repurchase Price or any accrued cash interest
in respect of the Notes held by such Holder, on or after the respective due dates expressed in the
Notes or any Provisional Redemption Date, and to convert the Notes in accordance with Article 10,
or to bring suit for the enforcement of any such payment on or after such respective dates or the
right to convert, shall not be impaired or affected adversely without the consent of such Holder.

          SECTION 6.08 Collection Suit by Trustee. If an Event of Default described in Section
6.01(1) or (2) occurs and is continuing, the Trustee may recover judgment in its own name and as
trustee of an express trust against the Company for the whole amount owing with respect to the
Notes and the amounts provided for in Section 7.06.

          SECTION 6.09 Trustee May File Proofs of Claim. In case of the pendency of any
receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment,
composition or other judicial proceeding relative to the Company or any other obligor upon the
Notes or the property of the Company or of such other obligor or their creditors, the Trustee
(irrespective of whether the principal amount, Provisional Redemption Price, Change in Control
Repurchase Price or any accrued cash interest in respect of the Notes shall then be due and payable
as therein expressed or by declaration or otherwise and irrespective of whether the Trustee shall
have made any demand on the Company for the payment of any such amount) shall be entitled and
empowered, by intervention in such proceeding or otherwise,

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     (a) to file and prove a claim for the whole amount of the principal amount, Provisional
Redemption Price, Change in Control Repurchase Price or any accrued cash interest and to
file such other papers or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel or any other amounts due
the Trustee under Section 7.06) and of the Holders allowed in such judicial proceeding, and

     (b) to collect and receive any moneys or other property payable or deliverable on any
such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or similar official 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 the Trustee any amount due 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 7.06.

          Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to
or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes 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 6.10 Priorities. If the Trustee collects any money pursuant to this Article
6, it shall pay out the money in the following order:

     (1) to the Trustee for amounts due under Section 7.06;

     (2) to Noteholders for amounts due and unpaid on the Notes for the principal amount,
Provisional Redemption Price, Change in Control Repurchase Price or any accrued cash
interest as the case may be, ratably, without preference or priority of any kind, according
to such amounts due and payable on the Notes; and

     (3) the balance, if any, to the Company.

          The Trustee may fix a record date and payment date for any payment to Noteholders pursuant to
this Section 6.10. At least 15 days before such record date, the Trustee shall mail to each
Noteholder and the Company a notice that states the record date, the payment date and the amount to
be paid.

          SECTION 6.11 Undertaking for Costs. In any suit for the enforcement of any right or
remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party litigant (other than
the Trustee) in the suit of an undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable attorneys’ fees and expenses, against
any party litigant in the suit, having due regard to the merits and good faith of the claims or
defenses made by the party litigant. This Section 6.11 does not apply to a suit by the Trustee, a
suit by a Holder pursuant to Section 6.07 or a suit by Holders of more than 10% in aggregate

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principal amount of the Notes at the time outstanding. This Section 6.11 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.

          SECTION 6.12 Waiver of Stay, Extension or Usury Laws. The Company covenants (to the
extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay or extension law or any usury
or other law wherever enacted, now or at any time hereafter in force, which would prohibit or
forgive the Company from paying all or any portion of the principal amount, Provisional Redemption
Price, Change in Control Repurchase Price or any accrued cash interest in respect of Notes, or any
interest on such amounts, as contemplated herein, or which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Trustee, but will suffer and
permit the execution of every such power as though no such law had been enacted.

ARTICLE 7

TRUSTEE

          SECTION 7.01 Duties and Responsibilities of the Trustee; During Default; Prior to
Default. The Trustee, prior to the occurrence of an Event of Default hereunder and after the
curing or waiving of all such Events of Default which may have occurred, undertakes to perform such
duties and only such duties as are specifically set forth in this Indenture. In case an Event of
Default hereunder has occurred (which has not been cured or waived), the Trustee shall exercise
such of the rights and powers vested in it by this Indenture, and use the same degree of care and
skill in their exercise, as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs.

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

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

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

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

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in the case of any such statements, certificates or opinions which by any
provision hereof are specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine whether or not they
conform to the requirements of this Indenture;

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

     (c) the Trustee shall not be liable with respect to any action taken or omitted to be
taken by it in good faith in accordance with the direction of the Holders pursuant to
Section 6.05 relating to the time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power conferred upon the
Trustee, under this Indenture.

          None of the provisions contained in this Indenture shall require the Trustee to expend or risk
its own funds or otherwise incur personal financial liability in the performance of any of its
duties or in the exercise of any of its rights or powers, if there shall be reasonable ground for
believing that the repayment of such funds or adequate indemnity against such liability is not
reasonably assured to it.

          The provisions of this Section 7.01 are in furtherance of and subject to Sections 315 and 316
of the TIA.

          SECTION 7.02 Certain Rights of the Trustee. In furtherance of and subject to the TIA
and subject to Section 7.01:

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

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

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

     (d) the Trustee shall be under no obligation to exercise any of the trusts or powers
vested in it by this Indenture with the request, order or direction of any of the
Noteholders pursuant to the provisions of this Indenture, unless such Noteholders shall

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have offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which might be incurred therein or thereby;

     (e) the Trustee shall not be liable for any action taken or omitted by it in good faith
and believed by it to be authorized or within the discretion, rights or powers conferred
upon it by this Indenture;

     (f) prior to the occurrence of an Event of Default hereunder and after the curing or
waiving of all such Events of Default, the Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval, appraisal, bond,
debenture, note, coupon, security, or other paper or document unless requested in writing
to do so by the Holders of not less than a majority in aggregate principal amount of the
Notes then outstanding; provided that, if the payment within a reasonable time to the
Trustee of the costs, expenses or liabilities likely to be incurred by it in the making of
such investigation is, in the opinion of the Trustee, not reasonably assured to the Trustee
by the security afforded to it by the terms of this Indenture, the Trustee may require
reasonable indemnity against such expenses or liabilities as a condition to proceeding; the
reasonable expenses of every such investigation shall be paid by the Company or, if paid by
the Trustee or any predecessor trustee, shall be repaid by the Company upon demand; and

     (g) the Trustee may execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents or attorneys not regularly in its employ
and the Trustee shall not be responsible for any misconduct or negligence on the part of any
such agent or attorney appointed with due care by it hereunder.

          SECTION 7.03 Trustee Not Responsible for Recitals, Disposition of Notes or Application of
Proceeds Thereof. The recitals contained herein and in the Notes, except the Trustee’s
certificates of authentication, shall be taken as the statements of the Company, and the Trustee
assumes no responsibility for the correctness of the same. The Trustee makes no representation as
to the validity or sufficiency of this Indenture or of the Notes. The Trustee shall not be
accountable for the use or application by the Company of any of the Notes or of the proceeds
thereof.

          SECTION 7.04 Trustee and Agents May Hold Notes; Collections, etc. The Trustee or any
agent of the Company or the Trustee, in its individual or any other capacity, may become the owner
or pledgee of Notes with the same rights it would have if it were not the Trustee or such agent
and, subject to Sections 7.08 and 7.13, if operative, may otherwise deal with the Company and
receive, collect, hold and retain collections from the Company with the same rights it would have
if it were not the Trustee or such agent.

          SECTION 7.05 Moneys Held by Trustee. Subject to the provisions of Section 8.02 hereof, all
moneys received by the Trustee shall, until used or applied as herein provided, be held in trust
for the purposes for which they were received, but need not be segregated from other funds except
to the extent required by mandatory provisions of law.

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Neither the Trustee nor any agent of the Company or the Trustee shall be under any liability
for interest on any moneys received by it hereunder.

          SECTION 7.06 Compensation and Indemnification of Trustee and Its Prior Claim. The
Company covenants and agrees to pay to the Trustee from time to time, and the Trustee shall be
entitled to, such compensation (which shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust) to be agreed to in writing by the Trustee and the
Company, and the Company covenants and agrees to pay or reimburse the Trustee and each predecessor
Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made
by or on behalf of it in accordance with any of the provisions of this Indenture (including (i) the
reasonable compensation and the expenses and disbursements of its counsel and of all agents and
other persons not regularly in its employ and (ii) interest at the prime rate on any disbursements
and advances made by the Trustee and not paid by the Company within 5 days after receipt of an
invoice for such disbursement or advance) except any such expense, disbursement or advance as may
arise from its negligence or bad faith. The Company also covenants to indemnify the Trustee and
each predecessor Trustee for, and to hold it harmless against, any loss, liability or expense
incurred without negligence or bad faith on its part, arising out of or in connection with the
acceptance or administration of this Indenture or the trusts hereunder and its duties hereunder,
including the costs and expenses of defending itself against or investigating any claim of
liability in the premises. The obligations of the Company under this Section 7.06 to compensate
and indemnify the Trustee and each predecessor Trustee and to pay or reimburse the Trustee and each
predecessor Trustee for expenses, disbursements and advances shall constitute additional
indebtedness hereunder and shall survive the satisfaction and discharge of this Indenture. Such
additional indebtedness shall be a senior claim to that of the Notes upon all property and funds
held or collected by the Trustee as such, except funds held in trust for the benefit of the Holders
of particular Notes, and the Notes are hereby effectively subordinated to such senior claim to such
extent. The provisions of this Section 7.06 shall survive the termination of this Indenture. When
the Trustee incurs expenses or renders services in connection with an Event of Default specified in
Section 6.01 or in connection with Article 6 hereof, the expenses (including the reasonable fees
and expenses of its counsel) and the compensation for services in connection therewith are to
constitute expenses of administration under any bankruptcy law.

          SECTION 7.07 Right of Trustee to Rely on Officers’ Certificate, etc. Subject to
Sections 7.01 and 7.02, whenever in the administration of the trusts of this Indenture the Trustee
shall deem it necessary or desirable that a matter be proved or established prior to taking or
suffering or omitting any action hereunder, such matter (unless other evidence in respect thereof
be herein specifically prescribed) may, in the absence of negligence or bad faith on the part of
the Trustee, be deemed to be conclusively proved and established by an Officers’ Certificate
delivered to the Trustee.

          SECTION 7.08 Conflicting Interests. If the Trustee has or shall acquire a conflicting
interest within the meaning of the TIA, the Trustee shall either eliminate such interest or resign,
to the extent and in the manner provided by, and subject to the provisions of, the TIA.

          SECTION 7.09 Persons Eligible for Appointment as Trustee. The Trustee shall at all
times be a corporation or banking association having a combined capital and surplus

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of at least $10,000,000. If such corporation or banking association publishes reports of
condition at least annually, pursuant to law or to the requirements of the aforesaid supervising or
examining authority, then, for the purposes of this Section 7.09, the combined capital and surplus
of such corporation shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section 7.09, the Trustee shall resign
immediately in the manner and with the effect specified in Section 7.10.

          SECTION 7.10 Resignation and Removal; Appointment of Successor Trustee. (a) The
Trustee, or any trustee or trustees hereafter appointed, may at any time resign with respect to one
or more or all series of Notes by giving written notice of resignation to the Company and by
mailing notice thereof by first class mail to the Holders of Notes at their last addresses as they
shall appear on the Note register. Upon receiving such notice of resignation, the Company shall
promptly appoint a successor trustee or trustees by written instrument in duplicate, executed by
authority of the Board of Directors, one copy of which instrument shall be delivered to the
resigning Trustee and one copy to the successor trustee or trustees. If no successor trustee shall
have been so appointed and have accepted appointment within 30 days after the mailing of such
notice of resignation, the resigning trustee may petition, at the expense of the Company, any court
of competent jurisdiction for the appointment of a successor trustee, or any Noteholder who has
been a bona fide Holder of a Note for at least six months may, subject to the provisions of Section
7.11, on behalf of himself and all others similarly situated, petition any such court for the
appointment of a successor trustee. Such court may thereupon, after such notice, if any, as it may
deem proper and prescribe, appoint a successor trustee.

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

     (i) the Trustee shall fail to comply with the provisions of Section 7.08 with respect
to any Notes after written request therefor by the Company or by any Noteholder who has been
a bona fide Holder of a Note for at least six months; or

     (ii) the Trustee shall cease to be eligible in accordance with the provisions of
Section 7.09 and shall fail to resign after written request therefor by the Company or by
any Noteholder; or

     (iii) the Trustee shall become incapable of acting or shall be adjudged a bankrupt or
insolvent, or a receiver or liquidator of the Trustee or of its property shall be appointed,
or any public officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation; or

then, in any such case, the Company may remove the Trustee and appoint a successor trustee by
written instrument, in duplicate, executed by order of the Board of Directors of the Company, one
copy of which instrument shall be delivered to the Trustee so removed and one copy to the successor
trustee, or, subject to the provisions of Section 7.11, any Noteholder who has been a bona fide
Holder of a Note for at least six months may on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor trustee. Such court may thereupon, after such notice, if any, as it may
deem proper and prescribe, remove the Trustee and appoint a successor trustee. If no

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successor trustee shall have been appointed and have accepted appointment within 30 days after a
notice of removal has been given, the removed trustee may petition, at the expense of the Company,
a court of competent jurisdiction for the appointment of a successor trustee.

          (c) The Holders of a majority in aggregate principal amount of the Notes at the time
outstanding may at any time remove the Trustee and appoint a successor trustee by delivering to the
Trustee so removed, to the successor trustee so appointed and to the Company the evidence of the
action in that regard taken by the Noteholders.

          (d) Any resignation or removal of the Trustee and any appointment of a successor trustee
pursuant to any of the provisions of this Section 7.10 shall become effective upon acceptance of
appointment by the successor trustee as provided in Section 7.11.

          SECTION 7.11 Acceptance of Appointment by Successor Trustee. Any successor trustee
appointed as provided in Section 7.10 shall execute and deliver to the Company and to its
predecessor trustee an instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the predecessor trustee shall become effective and such successor
trustee, without any further act, deed or conveyance, shall become vested with all rights, powers,
duties and obligations of its predecessor hereunder, with like effect as if originally named as
trustee hereunder; but, nevertheless, on the written request of the Company or of the successor
trustee, upon payment of its charges then unpaid, the trustee ceasing to act shall pay over to the
successor trustee all moneys at the time held by it hereunder and shall execute and deliver an
instrument transferring to such successor trustee all such rights, powers, duties and obligations.
Upon request of any such successor trustee, the Company shall execute any and all instruments in
writing for more fully and certainly vesting in and confirming to such successor trustee all such
rights and powers. Any trustee ceasing to act shall, nevertheless, retain a prior claim upon all
property or funds held or collected by such trustee to secure any amounts then due it pursuant to
the provisions of Section 7.06.

          No successor trustee shall accept appointment as provided in this Section 7.11 unless at the
time of such acceptance such successor trustee shall be qualified under the provisions of Section
7.08 and eligible under the provisions of Section 7.09.

          Upon acceptance of appointment by any successor trustee as provided in this Section 7.11, the
Company shall mail notice thereof by first class mail to the Holders of Notes at their last
addresses as they shall appear in the register. If the acceptance of appointment is substantially
contemporaneous with the resignation, then the notice called for by the preceding sentence may be
combined with the notice called for by Section 7.10. If the Company fails to mail such notice
within ten days after acceptance of appointment by the successor trustee, the successor trustee
shall cause such notice to be mailed at the expense of the Company.

          SECTION 7.12 Merger, Conversion, Consolidation or Succession to Business of Trustee.
Any corporation or banking association into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation or banking association resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any corporation or banking
association succeeding to all or substantially all of the corporate trust business of the Trustee,
shall be the successor of the Trustee hereunder, provided

52

 

that such corporation or banking association shall be qualified under the provisions of
Section 7.08 and eligible under the provisions of Section 7.09, without the execution or filing of
any paper or any further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding. In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any of the Notes shall have been authenticated but not delivered,
any such successor to the Trustee may adopt the certificate of authentication of any predecessor
Trustee and deliver such Notes so authenticated; and, in case at that time any of the Notes shall
not have been authenticated, any successor to the Trustee may authenticate such Notes either in the
name of any predecessor hereunder or in the name of the successor Trustee; and in all such cases
such certificate shall have the full force and effect that this Indenture provides for the
certificate of authentication of the Trustee; provided, that the right to adopt the certificate of
authentication of any predecessor Trustee or to authenticate Notes in the name of any predecessor
Trustee shall apply only to its successor or successors by merger, conversion or consolidation.

          SECTION 7.13 Preferential Collection of Claims Against the Company. The Trustee shall
comply with the provisions of Section 311 of the TIA.

          SECTION 7.14 Reports by the Trustee. (a) The Trustee shall transmit to Holders and
other persons such reports concerning the Trustee and its actions under this Indenture as may be
required pursuant to the TIA on or before July 15 in each year that such report is required, such
reports to be dated as of the immediately preceding May 15.

          (b) A copy of each such report shall, at the time of such transmission to Noteholders, be
furnished to the Company and be filed by the Trustee with each stock exchange upon which the Notes
are listed and also with the Commission. The Company agrees to notify the Trustee when and as the
Notes become admitted to trading on any national securities exchange.

          SECTION 7.15 Trustee to Give Notice of Default, But May Withhold in Certain
Circumstances. The Trustee shall transmit to the Noteholders, as the names and addresses of
such Holders appear on the Note register, notice by mail of all Defaults which have occurred, such
notice to be transmitted within 90 days after the occurrence thereof, unless such defaults shall
have been cured before the giving of such notice; provided that, except in the case of Default in
the payment of the principal of, interest on, or other similar obligation with respect to, any of
the Notes, the Trustee shall be protected in withholding such notice if and so long as the board of
directors, the executive committee, or a trust committee of directors or trustees and/or
Responsible Officers of the Trustee in good faith determines that the withholding of such notice is
in the best interests of the Noteholders.

ARTICLE 8

DISCHARGE OF INDENTURE

          SECTION 8.01 Discharge of Liability on Notes. When (i) all outstanding Notes will
become due and payable within one year of their Stated Maturity or (ii) all outstanding Notes are
scheduled for redemption within one year and, in either case, the Company

53

 

has deposited with the Trustee cash sufficient to pay and discharge all outstanding Notes on
the date of their Stated Maturity or the scheduled date of redemption, then the Company may
discharge its obligations under this Indenture while Notes remain outstanding; provided that the
Company shall remain obligated to issue shares upon conversion of the Notes. The Trustee shall
join in the execution of a document prepared by the Company acknowledging satisfaction and
discharge of this Indenture on demand of the Company accompanied by an Officers’ Certificate and
Opinion of Counsel and at the cost and expense of the Company.

           SECTION 8.02 Repayment of the Company. The Trustee and the Paying Agent shall return
to the Company upon written request any money or securities held by them for the payment of any
amount with respect to the Notes that remains unclaimed for two years, subject to applicable
unclaimed property law. After return to the Company, Holders entitled to the money or securities
must look to the Company for payment as general creditors unless an applicable abandoned property
law designates another person and the Trustee and the Paying Agent shall have no further liability
to the Noteholders with respect to such money or securities for that period commencing after the
return thereof.

ARTICLE 9

AMENDMENTS

           SECTION 9.01 Without Consent of Holders. The Company and the Trustee may amend this
Indenture or the Notes without the consent of any Noteholder for the purposes of, among other
things:

     (1) adding to the Company’s covenants for the benefit of the Holders;

     (2) surrendering any right or power conferred upon the Company;

     (3) providing for conversion rights of Holders if any reclassification or change of
Common Stock or any consolidation, merger or sale of all or substantially all of the
Company’s assets occurs;

     (4) reducing the Conversion Price, provided that the reduction will not adversely
affect the interests of Holders in any material respect;

     (5) complying with the requirements of the Commission in order to effect or maintain
the qualification of this Indenture under the TIA;

     (6) making any changes or modifications to this Indenture necessary in connection with
the registration of the Notes under the Securities Act as contemplated by the Registration
Rights Agreement, provided that this action does not adversely affect the interests of the
Holders in any material respect;

     (7) curing any ambiguity, omission, inconsistency or correcting or supplementing any
defective provision contained in this Indenture; provided that such modification or
amendment does not, in the good faith opinion of the Board of Directors and the Trustee,
adversely affect the interests of the Holders in any material respect;

54

 

     (8) adding or modifying any other provisions which the Company and the Trustee may deem
necessary or desirable and which will not adversely affect the interests of the Holders in
any material respect;

     (9) complying with Article 5; or

     (10) providing for uncertificated Notes in addition to the Certificated Notes so long
as such uncertificated Notes are in registered form for purposes of the Internal Revenue
Code of 1986, as amended.

           SECTION 9.02 With Consent of Holders. With the written consent of the Holders of at
least a majority in aggregate principal amount of the Notes at the time outstanding or by the
adoption of a resolution at a meeting of Holders at which a quorum is present by at least a
majority in aggregate principal amount of the Notes represented at the meeting, the Company may
modify and amend this Indenture or the Notes and waive noncompliance by the Company. However,
without the written consent of each Noteholder affected, a modification, amendment or waiver to
this Indenture or the Notes may not:

     (1) change the maturity of the principal of or any installment of interest on any Note
(including any payment of Liquidated Damages and any make whole premium payable pursuant to
Section 10.01(f) hereof);

     (2) reduce the principal amount of, or interest on (including any payment of Liquidated
Damages), any Note;

     (3) reduce the Interest Rate or interest (including any Liquidated Damages) on any
Note;

     (4) change the currency of payment of principal of or interest (including any
Liquidated Damages) of any Note;

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

     (6) except as otherwise permitted or contemplated by provisions of this Indenture
concerning corporate reorganizations, adversely affect the repurchase option of Holders upon
a Change in Control or the conversion rights of Holders;

     (7) modify the subordination provisions of the Notes in a manner adverse to the
Holders; or

     (8) reduce the percentage in aggregate principal amount of Notes outstanding necessary
to modify or amend this Indenture or to waive any past Default.

           It shall not be necessary for the Holders to approve the particular form of any proposed
amendment in their written consent or resolution pursuant to this Section 9.02, but it shall be
sufficient if such consent approves the substance thereof.

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          After an amendment under this Section 9.02 becomes effective, the Company shall mail to each
Holder a notice briefly describing the amendment.

          SECTION 9.03 Compliance with Trust Indenture Act. Every supplemental indenture
executed pursuant to this Article shall comply with the TIA.

          SECTION 9.04 Revocation and Effect of Consents, Waivers and Actions. Until an
amendment, waiver or other action by Holders becomes effective, a consent thereto by a Holder of a
Note hereunder is a continuing consent by the Holder and every subsequent Holder of that Note or
portion of the Note that evidences the same obligation as the consenting Holder’s Note, even if
notation of the consent, waiver or action is not made on the Note. However, any such Holder or
subsequent Holder may revoke the consent, waiver or action as to such Holder’s Note or portion of
the Note if the Trustee receives the notice of revocation before the date the amendment, waiver or
action becomes effective. After an amendment, waiver or action becomes effective, it shall bind
every Noteholder.

          SECTION 9.05 Notation on or Exchange of Notes. Notes authenticated and delivered
after the execution of any supplemental indenture pursuant to this Article 9 may, and shall if
required by the Trustee, bear a notation in form approved by the Trustee as to any matter provided
for in such supplemental indenture. If the Company shall so determine, new Notes so modified as to
conform, in the opinion of the Board of Directors, to any such supplemental indenture may be
prepared and executed by the Company and authenticated and delivered by the Trustee in exchange for
outstanding Notes.

          SECTION 9.06 Trustee to Sign Supplemental Indentures. The Trustee shall sign any
supplemental indenture authorized pursuant to this Article 9 if the amendment contained therein
does not adversely affect the rights, duties, liabilities or immunities of the Trustee. If it
does, the Trustee may, but need not, sign such supplemental indenture. In signing such
supplemental indenture the Trustee shall be entitled to receive, and (subject to the provisions of
Section 7.01) shall be fully protected in relying upon, an Officers’ Certificate and an Opinion of
Counsel stating that such amendment is authorized or permitted by this Indenture.

          SECTION 9.07 Effect of Supplemental Indentures. Upon the execution of any
supplemental indenture under this Article 9, 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 Notes theretofore or thereafter authenticated and delivered hereunder shall be
bound thereby.

ARTICLE 10

CONVERSION

          SECTION 10.01 Conversion Right and Conversion Price.

          (a) Subject to and upon compliance with the provisions of this Article 10 and to the right of
the Company to pay some or all of the conversion consideration in cash in accordance with Section
10.14, at the option of the Holder thereof, any Note or any portion of the principal amount thereof
which is a whole multiple of $1,000 may be converted at the

56

 

principal amount thereof, or of such portion thereof, into duly authorized, fully paid and
nonassessable shares of Common Stock, at the Conversion Price, determined as hereinafter provided,
in effect at the time of conversion, but only under the following circumstances:

     (1) during any calendar quarter beginning after October 31, 2006, and only during such
calendar quarter, if, as of the last day of the immediately preceding calendar quarter, the
Volume Weighted Average Price per share of the Common Stock for at least 20 Trading Days in
the period of the 30 consecutive Trading Days ending on the last Trading Day of such
preceding calendar quarter was more than 150% of the Conversion Price on the last day of
such preceding calendar quarter (the “Conversion Trigger Price”);

     (2) during any five Trading Day period after any five consecutive Trading Day period in
which the Trading Price per $1,000 principal amount of Notes, as determined following a
request by a Holder in accordance with the procedures described below in Section
10.01(d)(ii), for each day of that period was less than 98% of the product of the Volume
Weighted Average Price of the Common Stock for each day in that period and the Conversion
Rate per $1,000 principal amount of Securities;

     (3) if the Company distributes to all holders of Common Stock rights or warrants
entitling them to purchase, for a period expiring within 45 days of the date of issuance,
Common Stock at less than the Current Market Price of the Common Stock on the day of
issuance;

     (4) if the Company distributes to all holders of Common Stock, assets, debt securities
or rights to purchase the Company’s securities, which distribution has a per share value
exceeding 7.5% of the Volume Weighted Average Price of the Common Stock on the Business Day
preceding the declaration date for such distribution;

     (5) if a Change in Control occurs or is anticipated to occur;

     (6) at any time during the period beginning 60 days prior to, but excluding, the Stated
Maturity; or

     (7) for Notes that have been called for redemption, at any time prior to the close of
business on the Business Day prior to the Provisional Redemption Date, even if the Notes are
not otherwise convertible at such time.

           In case a Note or portion thereof is called for redemption, such conversion right in respect
of the Note or the portion so called, shall expire at the close of business on the Business Day
preceding the applicable Provisional Redemption Date, unless the Company defaults in making the
payment due upon redemption. In the case of a Change in Control for which the Holder exercises its
repurchase right with respect to a Note or portion thereof, such conversion right in respect of the
Note or portion thereof shall expire at the close of business on the Business Day immediately
preceding the Change in Control Repurchase Date.

           The price at which shares of Common Stock shall be delivered upon conversion (the “Conversion
Price”) shall be initially equal to approximately $3.28 per share of Common

57

 

Stock. The Conversion Price shall be adjusted in certain instances as provided in paragraphs
(a), (b), (c), (d), (e), (f), (h) and (i) of Section 10.04 and Section 10.12 hereof.

          In all events, upon the delivery by the Company to the Holders of the full number of the
shares of Common Stock into which the Notes are convertible, together with any cash payment for the
Holders’ fractional shares or cash payment in accordance with Section 10.14, the obligation of the
Company to pay the principal amount of the Notes and any accrued and unpaid interest thereon shall
be deemed satisfied. Accrued and unpaid interest shall be deemed paid in full rather than
cancelled, extinguished or forfeited.

     (b) In the case of a distribution contemplated by clauses (3) and (4) of Section 10.01(a), the
Company shall notify Holders at least 20 days prior to the ex-dividend date for such distribution
(the “Distribution Notice”). Once the Company has given the Distribution Notice, Holders may
surrender their Notes for conversion at any time until the earlier of the close of business on the
last Trading Day preceding the ex-dividend date or the Company’s announcement that such
distribution will not take place. In the event of a distribution contemplated by clauses (3) and
(4) of Section 10.01(a), Holders may not convert the Notes if the Holders will otherwise
participate in such distribution without converting their Notes. The Company will provide written
notice to the Conversion Agent as soon as reasonably practicable of any anticipated or actual event
or transaction that will cause or causes the Notes to become convertible pursuant to clauses (3) or
(4) of Section 10.01(a).

     (c) In the case of a transaction contemplated by clause (5) of Section 10.01(a), the Company
will notify the Holders and Trustee at least 30 Trading Days prior to the anticipated Change in
Control Effective Date of any Change in Control that the Company knows or reasonably should know
will occur. If the Company does not know, and should not reasonably know, that a Change in Control
will occur until a date that is within 30 Trading Days before the anticipated Change in Control
Effective Date or other applicable event, the Company will notify the Holders and the Trustee
promptly after the Company has knowledge of such Change in Control or such other event. Holders
may surrender Notes for conversion at any time beginning 30 Trading Days before the anticipated
Change in Control Effective Date of a Change in Control and until the Trading Day prior to the date
of the Change in Control Repurchase Date.

     (d) (1) For each calendar quarter of the Company, beginning with the calendar quarter
beginning at any time after October 31, 2006, the Company will cause an independent valuation
advisor (a “Valuation Expert”), on behalf of the Company, to determine, on the first Business Day
following the last Trading Day of the previous calendar quarter, whether the Notes are convertible
pursuant to clause (1) of Section 10.01(a), and, if so, to notify the Trustee, the Conversion Agent
and the Company in writing. Upon request of the Valuation Expert, the Company shall provide, or
cause to be provided to, the Valuation Expert the Volume Weighted Average Price per share of Common
Stock for the 30 consecutive Trading Days ending on the last Trading Day of the preceding calendar
quarter.

          (2) The Trustee shall have no obligation to determine the Trading Price of the Notes and
whether the Notes are convertible pursuant to clause (2) of Section 10.01(a) unless the Company has
requested such determination in writing; and the Company shall have no obligation to make such
request unless a Holder of Notes provides the Company with reasonable

58

 

evidence that the Trading Price per $1,000 principal amount of Notes would be less than 98% of
the product of the Volume Weighted Average Price of the Common Stock and the Conversion Rate per
$1,000 principal amount of Notes. At such time, the Company shall instruct the Valuation Expert to
determine the Trading Price of the Notes beginning on the next Trading Day and on each successive
Trading Day until the Trading Price per $1,000 principal amount of the Notes is greater than 98% of
the product of the Volume Weighted Average Price of the Common Stock and the Conversion Rate per
$1,000 principal amount of the Notes.

     (e) The conversion rights pursuant to this Article 10 shall commence on the initial issuance
date of the Notes and expire at the close of business on date of the Stated Maturity of the Notes,
but shall be exercisable only during the time periods specified with respect to each circumstance
pursuant to which the Notes become convertible, subject, in the case of conversion of any Global
Notes, to any Applicable Procedures. If a Note is submitted or presented for purchase upon a
Change in Control pursuant to Section 3.10, such conversion right shall terminate at the close of
business on the Business Day immediately preceding the Change in Control Repurchase Date (unless
the Company shall fail to make the Change in Control Repurchase Price payment when due in
accordance with Section 3.10, in which case the conversion right shall terminate at the close of
business on the date such failure is cured and such Note is repurchased). If a Note is convertible
as a result of a Change in Control, such conversion right shall commence and terminate as set forth
in Section 10.01(c). Notes in respect of which a Change in Control Repurchase Notice has been
delivered may not be surrendered for conversion pursuant to this Article 10 prior to a valid
withdrawal of such Change in Control Notice in accordance with the provisions of Section 3.10.

     (f) If there shall have occurred a Change in Control at any time prior to the Stated Maturity,
then the Conversion Rate per $1,000 principal amount of Notes otherwise in effect in respect of
Notes for which a conversion notice is received by the Conversion Agent during the period beginning
30 Trading Days before the date announced by the Company as the anticipated Change in Control
Effective Date and ending at the close of business on the Trading Day immediately preceding the
Change in Control Repurchase Date shall be increased by the amount, if any, determined by reference
to the table below, based on the Change in Control Effective Date and the Stock Price of such
Change in Control; provided that if the Stock Price or Change in Control Effective Date are
not set forth on the table: (i) if the actual Stock Price on the Change in Control Effective Date
is between two Stock Prices on the table or the actual Change in Control Effective Date is between
two Change in Control Effective Dates on the table, the amount of the Conversion Rate adjustment
will be determined by a straight-line interpolation between the adjustment amounts set forth for
the two Stock Prices and the two Change in Control Effective Dates on the table based on a 365-day
year, as applicable, (ii) if the Stock Price on the Change in Control Effective Date exceeds $8.00
per share, subject to adjustment as set forth herein, no adjustment to the applicable Conversion
Rate will be made, and (iii) if the Stock Price on the Change in Control Effective Date is less
than $2.50 per share, subject to adjustment as set forth herein, no adjustment to the applicable
Conversion Rate will be made. If holders of the Common Stock receive only cash in the Change in
Control, the Stock Price shall be the cash amount paid per share of the Common Stock in connection
with the Change in Control. Otherwise, the Stock Price shall be equal to the Volume Weighted
Average Price of the Common Stock for each of the 10 Trading Days immediately preceding, but not
including, the applicable Change in Control Effective Date.

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     The following table shows the amount, if any, by which the applicable Conversion Rate will
increase for each Stock Price and Change in Control Effective Date set forth below:

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

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Stock Price	 	October	 	October	 	October	 	October	 	October
	on	 	12,	 	15,	 	15,	 	15,	 	15,
	Effective Date	 	2006	 	2007	 	2008	 	2009	 	2010
	 
	 	$	2.50	 	 	 	105.5	 	 	 	105.5	 	 	 	105.9	 	 	 	102.6	 	 	 	0	 
	 
	 	$	3.00	 	 	 	76.4	 	 	 	72.2	 	 	 	71.5	 	 	 	63.0	 	 	 	0	 
	 
	 	$	3.50	 	 	 	54.2	 	 	 	46.2	 	 	 	45.2	 	 	 	37.5	 	 	 	0	 
	 
	 	$	4.00	 	 	 	39.2	 	 	 	27.9	 	 	 	27.0	 	 	 	21.3	 	 	 	0	 
	 
	 	$	4.50	 	 	 	28.9	 	 	 	15.1	 	 	 	14.5	 	 	 	10.7	 	 	 	0	 
	 
	 	$	5.00	 	 	 	24.5	 	 	 	7.0	 	 	 	5.0	 	 	 	3.0	 	 	 	0	 
	 
	 	$	5.50	 	 	 	19.0	 	 	 	0	 	 	 	0	 	 	 	0	 	 	 	0	 
	 
	 	$	6.00	 	 	 	14.9	 	 	 	0	 	 	 	0	 	 	 	0	 	 	 	0	 
	 
	 	$	6.50	 	 	 	11.9	 	 	 	0	 	 	 	0	 	 	 	0	 	 	 	0	 
	 
	 	$	7.00	 	 	 	9.6	 	 	 	0	 	 	 	0	 	 	 	0	 	 	 	0	 
	 
	 	$	7.50	 	 	 	7.8	 	 	 	0	 	 	 	0	 	 	 	0	 	 	 	0	 
	 
	 	$	8.00	 	 	 	6.4	 	 	 	0	 	 	 	0	 	 	 	0	 	 	 	0	 

     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 Notes 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 the
Stock Price adjustment and the denominator of which is the Conversion Rate as so adjusted. The
Conversion Rate adjustment amounts set forth in the table above will be adjusted in the same manner
as the Conversion Rate as set forth in Section 10.04, other than as a result of an adjustment of
the Conversion Rate by virtue of the provisions of this Section 10.01(f).

          SECTION 10.02 Exercise of Conversion Right. To exercise the conversion right, the
Holder of any Note to be converted shall surrender such Note duly endorsed or assigned to the
Company or in blank, at the office of any Conversion Agent, accompanied by a duly signed conversion
notice substantially in the form attached to the Note to the Company stating that the Holder elects
to convert such Note or, if less than the entire principal amount thereof is to be converted, the
portion thereof to be converted.

          Notwithstanding the foregoing provision of this Section 10.02, if Notes are surrendered for
conversion after the close of business on any Regular Record Date and on or prior to the next
succeeding Interest Payment Date, the Holder of such Notes as of such Record Date shall receive the
interest that is payable on such Notes on the applicable Interest Payment Date. However, Notes
that are surrendered for conversion after the close of business on any Regular Record Date, but on
or prior to the opening of business on the next succeeding Interest Payment Date shall be
accompanied by payment in New York Clearing House funds or other

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funds acceptable to the Company of an amount equal to the interest to be received on such
Interest Payment Date on the principal amount of Notes being surrendered for conversion, unless
such Notes have been called for redemption on the applicable Provisional Redemption Date that
occurs after that Regular Record Date and on or prior to the third Business Day after that Interest
Payment Date, in which case no payment shall be required.

          Notes shall be deemed to have been converted immediately prior to the close of business on the
day of surrender of such Notes for conversion in accordance with the foregoing provisions, and at
such time the rights of the Holders of such Notes as Holders shall cease, and the Person or Persons
entitled to receive the Common Stock issuable upon conversion shall be treated for all purposes as
the record holder or holders of such Common Stock at such time. As promptly as practicable on or
after the conversion date, the Company shall cause to be issued and delivered to such Conversion
Agent a certificate or certificates for the number of full shares of Common Stock issuable upon
conversion, together with payment in lieu of any fraction of a share as provided in Section 10.03
hereof.

          In the case of any Note which is converted in part only, upon such conversion the Company
shall execute and the Trustee shall authenticate and deliver to the Holder thereof, at the expense
of the Company, a new Note or Notes of authorized denominations in aggregate principal amount equal
to the unconverted portion of the principal amount of such Notes.

          If shares of Common Stock to be issued upon conversion of a Restricted Note, or securities to
be issued upon conversion of a Restricted Note in part only, are to be registered in a name other
than that of the Holder of such Restricted Note, such Holder must deliver to the Conversion Agent a
certificate in substantially the form set forth in the form of Note set forth in Exhibit A annexed
hereto, dated the date of surrender of such Restricted Note and signed by such Holder, as to
compliance with the restrictions on transfer applicable to such Restricted Note. Neither the
Trustee nor any Conversion Agent, Registrar or Transfer Agent shall be required to register in a
name other than that of the Holder shares of Common Stock or Notes issued upon conversion of any
such Restricted Note not so accompanied by a properly completed certificate.

          The Company hereby initially appoints the Trustee as the Conversion Agent.

          SECTION 10.03 Fractions of Shares. No fractional shares of Common Stock shall be
issued upon conversion of any Note or Notes. If more than one Note shall be surrendered for
conversion at one time by the same Holder, the number of full shares which shall be issued upon
conversion thereof shall be computed on the basis of the aggregate principal amount of the Notes
(or specified portions thereof) so surrendered. Instead of any fractional share of Common Stock
which would otherwise be issued upon conversion of any Note or Notes (or specified portions
thereof), the Company shall pay a cash adjustment in respect of such fraction (calculated to the
nearest one-100th of a share) in an amount equal to the same fraction of the quoted price of the
Common Stock as of the Trading Day preceding the date of conversion.

          SECTION 10.04 Adjustment of Conversion Price. The Conversion Price shall be subject
to adjustments, calculated by the Company, from time to time as follows:

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     (a) In case the Company shall hereafter pay a dividend or make a distribution to all holders
of the outstanding Common Stock in shares of Common Stock, the Conversion Price in effect at the
opening of business on the date following the date fixed for the determination of stockholders
entitled to receive such dividend or other distribution shall be reduced by multiplying such
Conversion Price by a fraction:

     (1) the numerator of which shall be the number of shares of Common Stock outstanding at
the close of business on the Record Date (as defined in Section 10.04(g)) fixed for such
determination, and

     (2) the denominator of which shall be the sum of such number of shares and the total
number of shares constituting such dividend or other distribution.

Such reduction shall become effective immediately after the opening of business on the day
following the Record Date. If any dividend or distribution of the type described in this Section
10.04(a) is declared but not so paid or made, the Conversion Price shall again be adjusted to the
Conversion Price which would then be in effect if such dividend or distribution had not been
declared.

     (b) In case the outstanding shares of Common Stock shall be subdivided into a greater number
of shares of Common Stock, the Conversion Price in effect at the opening of business on the day
following the day upon which such subdivision becomes effective shall be proportionately reduced,
and conversely, in case outstanding shares of Common Stock shall be combined into a smaller number
of shares of Common Stock, the Conversion Price in effect at the opening of business on the day
following the day upon which such combination becomes effective shall be proportionately increased,
such reduction or increase, as the case may be, to become effective immediately after the opening
of business on the day following the day upon which such subdivision or combination becomes
effective.

     (c) In case the Company shall issue rights or warrants (other than any rights or warrants
referred to in Section 10.04(d)) to all holders of its outstanding shares of Common Stock entitling
them 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 (as defined in Section 10.04(g)) on the Record Date fixed for the determination of
stockholders entitled to receive such rights or warrants, the Conversion Price shall be adjusted so
that the same shall equal the price determined by multiplying the Conversion Price in effect at the
opening of business on the date after such Record Date by a fraction:

     (1) the numerator of which shall be the number of shares of Common Stock outstanding at
the close of business on the Record Date plus the number of shares which the aggregate
offering price of the total number of shares so offered for subscription or purchase (or the
aggregate conversion price of the convertible securities so offered) would purchase at such
Current Market Price, and

     (2) the denominator of which shall be the number of shares of Common Stock outstanding
on the close of business on the Record Date plus the total number of

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additional shares of Common Stock so offered for subscription or purchase (or into
which the convertible securities so offered are convertible).

Such adjustment shall become effective immediately after the opening of business on the day
following the Record Date fixed for determination of stockholders entitled to receive such rights
or warrants. To the extent that shares of Common Stock (or securities convertible into Common
Stock) are not delivered pursuant to such rights or warrants, upon the expiration or termination of
such rights or warrants the Conversion Price shall be readjusted to the Conversion Price which
would then be in effect had the adjustments made upon the issuance of such rights or warrants been
made on the basis of the delivery of only the number of shares of Common Stock (or securities
convertible into Common Stock) actually delivered. In the event that such rights or warrants are
not so issued, the Conversion Price shall again be adjusted to be the Conversion Price which would
then be in effect if such date fixed for the determination of stockholders entitled to receive such
rights or warrants had not been fixed. In determining whether any rights or warrants entitle the
holders to subscribe for or purchase shares of Common Stock at less than such Current Market Price,
and in determining the aggregate offering price of such shares of Common Stock, there shall be
taken into account any consideration received for such rights or warrants, the value of such
consideration if other than cash, to be determined by the Board of Directors.

     (d) In case the Company shall, by dividend or otherwise, distribute to all holders of its
Common Stock shares of any class of capital stock of the Company (other than any dividends or
distributions to which Section 10.04(a) applies) or evidences of its indebtedness or other assets,
including securities, but excluding (1) any rights or warrants referred to in Section 10.04(c), (2)
any dividends or distributions in connection with a reclassification, change, merger,
consolidation, statutory share exchange, combination, sale or conveyance to which Section 10.11
hereof applies and (3) dividends and distributions paid exclusively in cash (the securities
described in foregoing clauses (1), (2) and (3) hereinafter in this Section 10.04(d) called the
“excluded securities”), then, in each such case, subject to the second succeeding paragraph of this
Section 10.04(d), the Conversion Price shall be adjusted so that the same shall be equal to the
price determined by multiplying the Conversion Price in effect immediately prior to the close of
business on the Record Date (as defined in Section 10.04(g)) with respect to such distribution by a
fraction:

     (1) the numerator of which shall be the Current Market Price (determined as provided in
Section 10.04(g)) on such date less the fair market value (as determined by the Board of
Directors, whose determination shall be conclusive and set forth in a Board Resolution) on
such date of the portion of the securities so distributed (other than excluded securities)
applicable to one share of Common Stock (determined on the basis of the number of shares of
the Common Stock outstanding on the Record Date), and

     (2) the denominator of which shall be such Current Market Price.

Such reduction shall become effective immediately prior to the opening of business on the day
following the Record Date. However, in the event that the then fair market value (as so
determined) of the portion of the securities so distributed (other than excluded securities)
applicable to one share of Common Stock is equal to or greater than the Current Market Price on

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the Record Date, in lieu of the foregoing adjustment, adequate provision shall be made so that each
Holder shall have the right to receive upon conversion of a Note (or any portion thereof) the
amount of securities so distributed (other than excluded securities) such Holder would have
received had such Holder converted such Note (or portion thereof) immediately prior to such Record
Date. In the event that such dividend or distribution is not so paid or made, the Conversion Price
shall again be adjusted to be the Conversion Price that would then be in effect if such dividend or
distribution had not been declared.

          If the Board of Directors determines the fair market value of any distribution for purposes of
this Section 10.04(d) by reference to the actual or when issued trading market for any securities
comprising all or part of such distribution (other than excluded securities), it must in doing so
consider the prices in such market over the same period (the “Reference Period”) used in computing
the Current Market Price pursuant to Section 10.04(g) to the extent possible, unless the Board of
Directors in a Board Resolution determines in good faith that determining the fair market value
during the Reference Period would not be in the best interest of the Holder.

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

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

             (ii) are not exercisable; and

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

shall be deemed not to have been distributed for purposes of this Section 10.04(d) (and no
adjustment to the Conversion Price under this Section 10.04(d) will be required) until the
occurrence of the earliest Trigger Event. If such right or warrant is subject to subsequent
events, upon the occurrence of which such right or warrant shall become exercisable to purchase
different securities, evidences of indebtedness or other assets or entitle the holder to purchase a
different number or amount of the foregoing or to purchase any of the foregoing at a different
purchase price, then the occurrence of each such event shall be deemed to be the date of issuance
and record date with respect to a new right or warrant (and a termination or expiration of the
existing right or warrant without exercise by the holder thereof). In addition, in the event of
any distribution (or deemed distribution) of rights or warrants, or any Trigger Event or other
event (of the type described in the preceding sentence) with respect thereto, that resulted in an
adjustment to the Conversion Price under this Section 10.04(d):

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

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rights or warrants), made to all holders of Common Stock as of the date of such
redemption or repurchase, and

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

            For purposes of this Section 10.04(d) and Sections 10.04(a), 10.04(b) and 10.04(c), any
dividend or distribution to which this Section 10.04(d) is applicable that also includes shares of
Common Stock, a subdivision or combination of Common Stock to which Section 10.04(b) applies, or
rights or warrants to subscribe for or purchase shares of Common Stock to which Section 10.04(c)
applies (or any combination thereof), shall be deemed instead to be:

     (5) a dividend or distribution of the evidences of indebtedness, assets, shares of
capital stock, rights or warrants other than such shares of Common Stock, such subdivision
or combination or such rights or warrants to which Sections 10.04(a), 10.04(b) and 10.04(c)
apply, respectively (and any Conversion Price reduction required by this Section 10.04(d)
with respect to such dividend or distribution shall then be made), immediately followed by

     (6) a dividend or distribution of such shares of Common Stock, such subdivision or
combination or such rights or warrants (and any further Conversion Price reduction required
by Sections 10.04(a), 10.04(b) and 10.04(c) with respect to such dividend or distribution
shall then be made), except:

     (A) the Record Date of such dividend or distribution shall be
substituted as (x) “the date fixed for the determination of stockholders
entitled to receive such dividend or other distribution”, “Record Date fixed
for such determinations” and “Record Date” within the meaning of Section
10.04(a), (y) “the day upon which such subdivision becomes effective” and
“the day upon which such combination becomes effective” within the meaning
of Section 10.04(b), and (z) as “the date fixed for the determination of
stockholders entitled to receive such rights or warrants”, “the Record Date
fixed for the determination of the stockholders entitled to receive such
rights or warrants” and such “Record Date” within the meaning of Section
10.04(c), and

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

          (e) In case the Company shall, by dividend or otherwise, distribute to all holders of its
Common Stock cash (excluding any cash that is distributed upon a reclassification,

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change, merger, consolidation, statutory share exchange, combination, sale or conveyance to
which Section 10.11 hereof applies or as part of a distribution referred to in Section 10.04(d)
hereof), then and in each such case, immediately after the close of business on such date, the
Conversion Price shall be reduced so that the same shall equal the price determined by multiplying
the Conversion Price in effect immediately prior to the close of business on such Record Date by a
fraction:

     (i) the numerator of which shall be equal to the Current Market Price on the Record
Date less an amount equal to the quotient of (x) the amount of such cash dividend or
distribution and (y) the number of shares of Common Stock outstanding on the Record Date,
and

     (ii) the denominator of which shall be equal to the Current Market Price on such date.

However, in the event that the amount of such cash dividend or distribution applicable to one share
of Common Stock is equal to or greater than the Current Market Price on the Record Date, in lieu of
the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right
to receive upon conversion of a Note (or any portion thereof) the amount of cash such Holder would
have received had such Holder converted such Note (or portion thereof) immediately prior to such
Record Date. In the event that such cash dividend or distribution is not so paid or made, the
Conversion Price shall again be adjusted to be the Conversion Price that would then be in effect if
such cash dividend or distribution had not been declared.

           (f) In case a tender offer or exchange offer made by the Company or any of its Subsidiaries
for all or any portion of the Common Stock shall expire and such tender offer or exchange offer (as
amended upon the expiration thereof) shall require the payment to stockholders (based on the
acceptance (up to any maximum specified in the terms of the tender offer or exchange offer) of
Purchased Shares (as defined below)) of cash and other consideration having a fair market value (as
determined by the Board of Directors, whose determination shall be conclusive and set forth in a
Board Resolution) exceeding the Current Market Price (determined as provided in Section 10.04(g))
as of the last time (the “Expiration Time”) tenders or exchanges could have been made pursuant to
such tender offer or exchange offer (as it may be amended) times the number of shares of Common
Stock outstanding (including any tendered shares or exchanged shares) on the Expiration Time, then,
and in each such case, immediately prior to the opening of business on the day after the date of
the Expiration Time, the Conversion Price shall be adjusted so that the same shall equal the price
determined by multiplying the Conversion Price in effect immediately prior to close of business on
the date of the Expiration Time by a fraction:

     (i) the numerator of which shall be the number of shares of Common Stock
outstanding (including any tendered or exchanged shares) at the Expiration Time
multiplied by the Current Market Price of the Common Stock on the Trading Day next
succeeding the Expiration Time, and

     (ii) the denominator shall be the sum of (x) the fair market value (determined
as aforesaid) of the aggregate cash and other consideration payable to

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stockholders based on the acceptance (up to any maximum specified in the terms
of the tender offer or exchange offer) of all shares validly tendered or exchanged
and not withdrawn as of the Expiration Time (the shares deemed so accepted, up to
any such maximum, being referred to as the “Purchased Shares”) and (y) the product
of the number of shares of Common Stock outstanding (less any Purchased Shares) on
the Expiration Time and the Current Market Price of the Common Stock on the Trading
Day next succeeding the Expiration Time.

Such reduction (if any) shall become effective immediately prior to the opening of business on the
day following the Expiration Time. In the event that the Company is obligated to repurchase shares
pursuant to any such tender offer or exchange offer, but the Company is permanently prevented by
applicable law from effecting any such repurchases or all such repurchases are rescinded, the
Conversion Price shall again be adjusted to be the Conversion Price which would then be in effect
if such tender offer or exchange offer had not been made. If the application of this Section
10.04(f) to any tender offer or exchange offer would result in an increase in the Conversion Price,
no adjustment shall be made for such tender offer or exchange offer under this Section 10.04(f).

      (g) For purposes of this Section 10.04, the following terms shall have the meanings indicated:

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

     (i) the “ex” date (as hereinafter defined) for any event (other than the
issuance or distribution requiring such computation) that requires an adjustment to
the Conversion Price pursuant to Section 10.04(a), (b), (c), (d), (e) or (f) 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 multiplying such
Closing Price by the same fraction by which the Conversion Price is so required to
be adjusted as a result of such other event;

     (ii) the “ex” date for any event (other than the issuance or distribution
requiring such computation) that requires an adjustment to the Conversion Price
pursuant to Section 10.04(a), (b), (c), (d), (e) or (f) 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 multiplying such Closing Price by the
reciprocal of the fraction by which the Conversion Price is so required to be
adjusted as a result of such other event; and

     (iii) the “ex” date for the issuance or distribution requiring such computation
is prior to the day in question, after taking into account any adjustment required
pursuant to clause (i) or (ii) of this proviso, the Closing Price for each Trading
Day on or after such “ex” date shall be adjusted by adding thereto the amount of any
cash and the fair market value (as determined by the

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Board of Directors in a manner consistent with any determination of such value
for purposes of Section 10.04(d) or (f), 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 10.04(f), the Current Market Price of the Common
Stock on any date shall be deemed to be the average of the daily Closing Prices per share of Common
Stock for such day and the next two succeeding Trading Days; provided, however, that if the “ex”
date for any event (other than the tender offer requiring such computation) that requires an
adjustment to the Conversion Price pursuant to Section 10.04(a), (b), (c), (d), (e) or (f) occurs
on or after the Expiration Time for the tender or exchange offer requiring such computation and
prior to the day in question, the Closing Price for each Trading Day on and after the “ex” date for
such other event shall be adjusted by multiplying such Closing Price by the reciprocal of the
fraction by which the Conversion Price is so required to be adjusted as a result of such other
event. For purposes of this paragraph, the term “ex” date, when used:

     (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 Price are called
for pursuant to this Section 10.04, such adjustments shall be made to the Current Market Price as
may be necessary or appropriate to effectuate the intent of this Section 10.04 and to avoid unjust
or inequitable results as determined in good faith by the Board of Directors.

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

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

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          (h) The Company may make such reductions in the Conversion Price, in addition to those
required by Section 10.04(a), (b), (c), (d), (e) or (f), as the Board of Directors considers to be
advisable to avoid or diminish any income tax to holders of Common Stock or rights to purchase
Common Stock resulting from any dividend or distribution of stock (or rights to acquire stock) or
from any event treated as such for income tax purposes.

          To the extent permitted by applicable law, the Company from time to time may reduce the
Conversion Price by any amount for any period of time if the period is at least 20 days and the
reduction is irrevocable during the period and the Board of Directors determines in good faith that
such reduction would be in the best interests of the Company, which determination shall be
conclusive and set forth in a Board Resolution. Whenever the Conversion Price is reduced pursuant
to the preceding sentence, the Company shall mail to the Trustee and each Holder at the address of
such Holder as it appears in the Register a notice of the reduction at least 15 days prior to the
date the reduced Conversion Price takes effect, and such notice shall state the reduced Conversion
Price and the period during which it will be in effect.

          (i) No adjustment in the Conversion Price shall be required unless such adjustment would
require an increase or decrease of at least 1% in the Conversion Price then in effect; provided,
however, that any adjustments which by reason of this Section 10.04(i) are not required to be made
shall be carried forward and taken into account in any subsequent adjustment. All calculations
under this Article 10 shall be made by the Company and shall be made to the nearest cent or to the
nearest one hundredth of a share, as the case may be. No adjustment need be made for a change in
the par value or no par value of the Common Stock.

          (j) In any case in which this Section 10.04 provides that an adjustment shall become effective
immediately after a Record Date for an event, the Company may defer until the occurrence of such
event (i) issuing to the Holder of any Note converted after such Record Date and before the
occurrence of such event the additional shares of Common Stock issuable upon such conversion by
reason of the adjustment required by such event over and above the Common Stock issuable upon such
conversion before giving effect to such adjustment and (ii) paying to such holder any amount in
cash in lieu of any fraction pursuant to Section 10.03 hereof.

          (k) For purposes of this Section 10.04, the number of shares of Common Stock at any time
outstanding shall not include shares held in the treasury of the Company but shall include shares
issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock.
The Company will not pay any dividend or make any distribution on shares of Common Stock held in
the treasury of the Company.

          SECTION 10.05 Notice of Adjustments of Conversion Price. Whenever the Conversion
Price is adjusted as herein provided (other than in the case of an adjustment pursuant to the
second paragraph of Section 10.04(h) for which the notice required by such paragraph has been
provided), the Company shall promptly file with the Trustee and any Conversion Agent other than the
Trustee an Officers’ Certificate setting forth the adjusted Conversion Price and showing in
reasonable detail the facts upon which such adjustment is based. Promptly after delivery of such
Officers’ Certificate, the Company shall prepare a notice stating that the Conversion Price has
been adjusted and setting forth the adjusted Conversion Price and the date on which each adjustment
becomes effective, and shall mail such notice to each Holder at the

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address of such Holder as it appears in the Register within 20 days of the effective date of
such adjustment. Failure to deliver such notice shall not affect the legality or validity of any
such adjustment.

           SECTION 10.06 Notice Prior to Certain Actions. In case at any time after the date
hereof:

     (1) the Company shall declare a dividend (or any other distribution) on its Common
Stock payable otherwise than in cash out of its capital surplus or its consolidated retained
earnings;

     (2) the Company shall authorize the granting to the holders of its Common Stock of
rights or warrants to subscribe for or purchase any shares of capital stock of any class (or
of securities convertible into shares of capital stock of any class) or of any other rights;

     (3) there shall occur any reclassification of the Common Stock of the Company (other
than a subdivision or combination of its outstanding Common Stock, a change in par value, a
change from par value to no par value or a change from no par value to par value), or any
merger, consolidation, statutory share exchange or combination to which the Company is a
party and for which approval of any shareholders of the Company is required, or the sale,
transfer or conveyance of all or substantially all of the assets of the Company; or

     (4) there shall occur the voluntary or involuntary dissolution, liquidation or winding
up of the Company;

the Company shall cause to be filed at each office or agency maintained for the purpose of
conversion of Notes pursuant to Section 4.05 hereof, and shall cause to be provided to the Trustee
and all Holders in accordance with Section 10.02 hereof, at least 20 days (or 10 days in any case
specified in clause (1) or (2) above) prior to the applicable record or effective date hereinafter
specified, a notice stating:

     (A) the date on which a record is to be taken for the purpose of such
dividend, distribution, rights or warrants, or, if a record is not to be
taken, the date as of which the holders of Common Stock of record to be
entitled to such dividend, distribution, rights or warrants are to be
determined, or

     (B) the date on which such reclassification, merger, consolidation,
statutory share exchange, combination, sale, transfer, conveyance,
dissolution, liquidation or winding up is expected to become effective, and
the date as of which it is expected that holders of Common Stock of record
shall be entitled to exchange their shares of Common Stock for securities,
cash or other property deliverable upon such reclassification, merger,
consolidation, statutory share exchange, sale, transfer, dissolution,
liquidation or winding up.

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          Neither the failure to give such notice nor any defect therein shall affect the legality or
validity of the proceedings or actions described in clauses (1) through (4) of this Section 10.06.

          SECTION 10.07 Company to Reserve Common Stock. The Company shall at all times use its
best efforts to reserve and keep available, free from preemptive rights, out of its authorized but
unissued Common Stock, for the purpose of effecting the conversion of Notes, the full number of
shares of fully paid and nonassessable Common Stock then issuable upon the conversion of all Notes
outstanding.

          SECTION 10.08 Taxes on Conversions. Except as provided in the next sentence, the
Company will pay any and all taxes (other than taxes on income) and duties that may be payable in
respect of the issue or delivery of shares of Common Stock on conversion of Notes pursuant hereto.
A Holder delivering a Note for conversion shall be liable for and will be required to pay any tax
or duty which may be payable in respect of any transfer involved in the issue and delivery of
shares of Common Stock in a name other than that of the Holder of the Note or Notes to be
converted, and no such issue or delivery shall be made unless the Person requesting such issue has
paid to the Company the amount of any such tax or duty, or has established to the satisfaction of
the Company that such tax or duty has been paid.

          SECTION 10.09 Covenant as to Common Stock. The Company covenants that all shares of
Common Stock which may be issued upon conversion of Notes will upon issue be fully paid and
nonassessable and, except as provided in Section 10.08, the Company will pay all taxes, liens and
charges with respect to the issue thereof.

          SECTION 10.10 Cancellation of Converted Notes. All Notes delivered for conversion
shall be delivered to the Trustee to be canceled by or at the direction of the Trustee, which shall
dispose of the same as provided in Section 2.10.

          SECTION 10.11 Effect of Reclassification, Consolidation, Merger or Sale. If any of
following events occur, namely:

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

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

    (3) any sale or conveyance of the properties and assets of the Company as, or
substantially as, an entirety to any other corporation as a result of which holders of
Common Stock shall be entitled to receive stock, securities or other property or assets
(including cash) with respect to or in exchange for such Common Stock,

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

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execution of such supplemental indenture if such supplemental indenture is then required to so
comply) providing that the Note shall be convertible into the kind and amount of shares of stock
and other securities or property or assets (including cash) which the Holders would have been
entitled to receive upon such reclassification, change, merger, consolidation, statutory share
exchange, combination, sale or conveyance had the Notes been converted into Common Stock
immediately prior to such reclassification, change, merger, consolidation, statutory share
exchange, combination, sale or conveyance assuming such holder of Common Stock did not exercise its
rights of election, if any, as to the kind or amount of securities, cash or other property
receivable upon such reclassification, change, merger, consolidation, statutory share exchange,
combination, sale or conveyance (provided that, if the kind or amount of securities, cash or other
property receivable upon such reclassification, change, merger, consolidation, statutory share
exchange, combination, sale or conveyance is not the same for each share of Common Stock in respect
of which such rights of election shall not have been exercised (“Non-Electing Share”), then for the
purposes of this Section 10.11 the kind and amount of securities, cash or other property receivable
upon such reclassification, change, merger, consolidation, statutory share exchange, combination,
sale or conveyance for each Non-Electing Share shall be deemed to be the kind and amount so
receivable per share by a plurality of the Non-Electing Shares). Appropriate provisions will be
made, as determined in good faith by the Company’s Board of Directors, to preserve the settlement
provisions of Section 10.14 following such reclassification, change, merger, consolidation,
statutory share exchange, combination, sale or reconveyance to the extent feasible. The Company
may not become a party to any such transaction unless its terms are consistent with this Section
10.11. Such supplemental indenture shall provide for adjustments that shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Article 10. If, in the
case of any such reclassification, change, merger, consolidation, statutory share exchange,
combination, sale or conveyance, 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
reclassification, change, merger, consolidation, statutory share exchange, combination, sale or
conveyance, then such supplemental indenture shall also be executed by such other corporation and
shall contain such additional provisions to protect the interests of the Holders of the Notes as
the Board of Directors shall reasonably consider necessary by reason of the foregoing, including to
the extent practicable the provisions providing for the repurchase rights set forth in Section 3.10
hereof.

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

          The above provisions of this Section 10.11 shall similarly apply to successive
reclassifications, mergers, consolidations, statutory share exchanges, combinations, sales and
conveyances.

          If this Section 10.11 applies to any event or occurrence, Section 10.04 hereof shall not
apply.

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          SECTION 10.12 Adjustment for Other Distributions. If, after the Issue Date of the
Notes, the Company pays a dividend or makes a distribution to all holders of its Common Stock
consisting of Capital Stock of any class or series, or similar equity interests, of or relating to
a Subsidiary or other business unit of the Company, the Conversion Price shall be adjusted in
accordance with the formula:

     P’ = P x 1/(1 + F/M)

where:

     P’ = the adjusted Conversion Price.

     P = the current Conversion Price.

     M = the average of the Post-Distribution Prices of the Common Stock for the 10 trading days
commencing on and including the fifth trading day after the date on which “ex-dividend trading”
commences for such dividend or distribution on the principal United States exchange or market which
such securities are then listed or quoted (the “Ex-Dividend Date”).

     F = the fair market value of the securities distributed in respect of each share of Common
Stock shall mean the number of securities distributed in respect of each share of Common Stock
multiplied by the average of the Post-Distribution Prices of those securities distributed for the
10 trading days commencing on and including the fifth trading day after the Ex-Dividend Date.

          “Post-Distribution Price” of Capital Stock or any similar equity interest on any date means
the closing per unit sale price (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
ask prices) on such date for trading of such units on a “when issued” basis without due bills (or
similar concept) as reported in the composite transactions for the principal United States
securities exchange or market on which such Capital Stock or equity interest is traded or, if the
Capital Stock or equity interest, as the case may be, is not listed on a United States national or
regional securities exchange or market, as reported by the National Association of Securities
Dealers Automated Quotation System or by the National Quotation Bureau Incorporated; provided that
if on any date such units have not traded on a “when issued” basis, the Post-Distribution Price
shall be the closing per unit sale price (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 ask prices) on such date for trading of such units on a “regular way” basis without due
bills (or similar concept) as reported in the composite transactions for the principal United
States securities exchange on which such Capital Stock or equity interest is traded or, if the
Capital Stock or equity interest, as the case may be, is not listed on a United States national or
regional securities exchange, as reported by the National Association of Securities Dealers
Automated Quotation System or by the National Quotation Bureau Incorporated. In the absence of
such quotation, the Company shall be entitled to determine the Post-Distribution Price on the basis
of such quotations, which reflect the post-distribution value of the Capital Stock or equity
interests as it considers appropriate.

          SECTION 10.13 Responsibility of Trustee for Conversion Provisions. The Trustee,
subject to the provisions of Section 7.01 hereof, and any Conversion Agent shall not at

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any time be under any duty or responsibility to any Holder of Notes to determine whether any
facts exist which may require any adjustment of the Conversion Price, or with respect to the nature
or intent of any such adjustments when made, or with respect to the method employed, or herein or
in any supplemental indenture provided to be employed, in making the same. Neither the Trustee,
subject to the provisions of Section 7.01 hereof, nor any Conversion Agent shall be accountable
with respect to the validity or value (of the kind or amount) of any Common Stock, or of any other
securities or property, which may at any time be issued or delivered upon the conversion of any
Note; and it or they do not make any representation with respect thereto. Neither the Trustee,
subject to the provisions of Section 7.01 hereof, nor any Conversion Agent shall be responsible for
any failure of the Company to make any cash payment or to issue, transfer or deliver any shares of
stock or share certificates or other securities or property upon the surrender of any Note for the
purpose of conversion; and the Trustee, subject to the provisions of Section 7.01 hereof, and any
Conversion Agent shall not be responsible or liable for any failure of the Company to comply with
any of the covenants of the Company contained in this Article 10.

          SECTION 10.14 Payment of Cash in Lieu of Common Stock.

          (a) In lieu of delivery of some or all of the shares of Common Stock otherwise issuable upon
notice of conversion of any Notes, Holders surrendering Notes for conversion shall receive for each
$1,000 principal amount of Notes surrendered for conversion: (A) cash in an amount equal to the
lesser of (1) $1,000 and (2) the Conversion Value; and, in addition to amounts distributed pursuant
to (A), (B) if the Conversion Value is greater than $1,000, a number of shares of Common Stock
equal to the sum of the Daily Share Amounts for each of the twenty consecutive Trading Days in the
Conversion Reference Period, appropriately adjusted to reflect stock splits, stock dividends,
combinations or similar events occurring during the Conversion Reference Period. The Company will
deliver such cash and any shares of Common Stock, together with any cash payable for fractional
shares, to such Holder in accordance with Section 10.01.

          (b) For the purposes of Section 10.14(a), in the event that any of Conversion Value, Daily
Share Amounts or Volume Weighted Average Price cannot be determined for all portions of the
Conversion Reference Period, the Company’s Board of Directors shall in good faith determine the
values necessary to calculate the Conversion Value, Daily Share Amounts and Volume Weighted Average
Price, as applicable.

ARTICLE 11

SUBORDINATION

          SECTION 11.01 Agreement to Subordinate. The Company agrees, and each Holder by
accepting a Note agrees, that the indebtedness, interest (including Liquidated Damages, if any) and
other obligations of any kind evidenced by the Notes and this Indenture are (i) subordinated in
right of payment, to the extent and in the manner provided in this Article 11, to the prior payment
in full in cash or cash equivalents (or otherwise to the extent holders of Senior Indebtedness
accept satisfaction of amounts due by settlement in other than cash or cash

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equivalents) of all Senior Indebtedness (whether outstanding on the date hereof or hereafter
created, incurred, assumed or guaranteed), and (ii) that the subordination is for the benefit of
the holders of Senior Indebtedness. The Notes shall be “Designated Senior Indebtedness” for
purposes of the indentures governing the Company’s Convertible Subordinated Notes.

          SECTION 11.02 Liquidation; Dissolution; Bankruptcy. In the event of any insolvency or
bankruptcy case or proceeding, or any receivership, liquidation, reorganization or other similar
case or proceeding in connection therewith, relating to the Company or to its assets, or any
liquidation, dissolution or other winding-up of the Company, whether voluntary or involuntary, or
any assignment for the benefit of creditors or other marshaling of assets or liabilities of the
Company (except in connection with the consolidation or merger of the Company or its liquidation or
dissolution following the conveyance, transfer or lease of its properties and assets substantially
upon the terms and conditions described in Article 5), the holders of Senior Indebtedness will be
entitled to receive payment in full in cash or cash equivalents of all Senior Indebtedness (or
otherwise to the extent holders of Senior Indebtedness accept satisfaction of amounts due by
settlement in other than cash or cash equivalents), or provision shall be made for such payment in
full, before the Noteholders will be entitled to receive any payment or distribution of any kind or
character (other than any payment or distribution in the form of equity securities or subordinated
securities of the Company or any successor obligor that, in the case of any such subordinated
securities, are subordinated in right of payment to all Senior Indebtedness that may at the time be
outstanding to at least the same extent as the Notes are so subordinated (such equity securities or
subordinated securities hereinafter being “Permitted Junior Securities”)) on account of principal
of, or additional interest in the form of Liquidated Damages if any, or interest on the Notes; and
any payment or distribution of assets of the Company of any kind or character, whether in cash,
property or securities (other than a payment or distribution in the form of Permitted Junior
Securities), by set-off or otherwise, to which the Noteholders or the Trustee would be entitled but
for the provisions of this Article 11 shall be paid by the liquidating trustee or agent or other
person making such payment or distribution, whether a trustee in bankruptcy, a receiver or
liquidating trustee or otherwise, directly to the holders of Senior Indebtedness or their
representative or representatives ratably according to the aggregate amounts remaining unpaid on
account of the Senior Indebtedness to the extent necessary to make payment in full of all Senior
Indebtedness remaining unpaid, after giving effect to any concurrent payment or distribution to the
holders of such Senior Indebtedness.

          SECTION 11.03 Default on Designated Senior Indebtedness. (a) No payment or
distribution of any assets of the Company of any kind or character, whether in cash, property or
securities (other than Permitted Junior Securities), may be made by or on behalf of the Company on
account of principal of or interest or Liquidated Damages on the Notes or on account of the
repurchase, redemption or other acquisition of Notes upon the occurrence of any Payment Default
until such Payment Default shall have been cured or waived in writing or shall have ceased to exist
or such Designated Senior Indebtedness shall have been discharged or paid in full in cash or cash
equivalents (or otherwise to the extent holders of Senior Indebtedness accept satisfaction of
amounts due by settlement in other than cash or cash equivalents). “Payment Default” shall mean a
default in payment, whether at scheduled maturity, upon scheduled installment, by acceleration or
otherwise, of principal of or premium, if any, or interest on Designated Senior Indebtedness beyond
any applicable grace period.

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          (b) No payment or distribution of any assets of the Company of any kind or character, whether
in cash, property or securities (other than Permitted Junior Securities), may be made by or on
behalf of the Company on account of principal of or interest or Liquidated Damages, if any, on the
Notes or on account of the repurchase, redemption or other acquisition of Notes during a Payment
Blockage Period (as defined below), upon the occurrence of any default or event of default with
respect to any Designated Senior Indebtedness other than any Payment Default pursuant to which the
maturity thereof may be accelerated (a “Non-Payment Default”) and receipt by the Trustee of written
notice thereof from the trustee or other representative of holders of Designated Senior
Indebtedness.

          The Payment Blockage Period shall mean the period (each, a “Payment Blockage Period”) that
will commence upon the date of receipt by the Trustee of written notice from the trustee or such
other representative of the holders of the Designated Senior Indebtedness in respect of which the
Non-Payment Default exists and shall end on the earliest of:

     (i) 179 days thereafter (provided that any Designated Senior Indebtedness as to which
notice was given shall not theretofore have been accelerated);

     (ii) the date on which such Non-Payment Default is cured, waived or ceases to exist;

     (iii) the date on which such Designated Senior Indebtedness is discharged or paid in
full; or

     (iv) the date on which such Payment Blockage Period shall have been terminated by
written notice to the Trustee or the Company from the trustee or such other representative
initiating such Payment Blockage Period,

after which the Company will resume making any and all required payments in respect of the Notes,
including any missed payments. In any event, not more than one Payment Blockage Period may be
commenced during any period of 365 consecutive days. No Non-Payment Default that existed or was
continuing on the date of the commencement of any Payment Blockage Period will be, or can be made,
the basis for the commencement of a subsequent Payment Blockage Period, unless such Non-Payment
Default has been cured or waived for a period of not less than 90 consecutive days subsequent to
the commencement of such initial Payment Blockage Period.

          SECTION 11.04 Acceleration of Notes. If payment of the Notes is accelerated because
of an Event of Default, the Company shall promptly notify holders of Senior Indebtedness of the
acceleration.

          SECTION 11.05 When Distribution Must Be Paid Over. In the event that, notwithstanding
the provisions of Sections 11.02 and 11.03, any payment or distribution of any kind or character,
whether in cash, property or securities, shall be received by the Trustee or any Noteholder which
is prohibited by such provisions, then and in such event such payment shall be held in trust for
the benefit of, and shall be paid over and delivered by such Trustee or Noteholder to, the trustee
or any other representative of holders of Senior Indebtedness, as their interest may appear, for
application to Senior Indebtedness remaining unpaid until all such

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Senior Indebtedness has been paid in full in cash or cash equivalents (or otherwise to the
extent holders of Senior Indebtedness accept satisfaction of amounts due by settlement in other
than cash or cash equivalents) after giving effect to any concurrent distribution to or for the
holders of Senior Indebtedness.

          With respect to the holders of Senior Indebtedness, the Trustee undertakes to perform only
such obligations on the part of the Trustee as are specifically set forth in this Article 11, 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 shall not be liable to any such holders if the
Trustee shall pay over or distribute to or on behalf of Noteholders or the Company or any other
Person money or assets to which any holders of Senior Indebtedness shall be entitled by virtue of
this Article 11, except if such payment is made as a result of the willful misconduct or gross
negligence of the Trustee.

          SECTION 11.06 Notice by the Company. The Company shall promptly notify the Trustee
and the Paying Agent of any facts known to the Company that would cause a payment of any
obligations with respect to the Notes to violate this Article 11, but failure to give such notice
shall not affect the subordination of the Notes to the Senior Indebtedness as provided in this
Article 11.

          SECTION 11.07 Subrogation. After all Senior Indebtedness is paid in full and until
the Notes are paid in full, Noteholders shall be subrogated (equally and ratably with all other
Indebtedness that is equal in right of payment to the Notes) to the rights of holders of Senior
Indebtedness to receive distributions applicable to Senior Indebtedness to the extent that
distributions otherwise payable to the Noteholders have been applied to the payment of Senior
Indebtedness. A distribution made under this Article 11 to holders of Senior Indebtedness that
otherwise would have been made to Noteholders is not, as between the Company and Noteholders, a
payment by the Company of the Notes.

          SECTION 11.08 Relative Rights. This Article 11 defines the relative rights of Holders
and holders of Senior Indebtedness. Nothing in this Indenture shall: (i) impair, as between the
Company and Holders, the obligation of the Company, which is absolute and unconditional, to pay
principal of and interest (including Liquidated Damages, if any) on the Notes in accordance with
their terms; (ii) affect the relative rights of Holders other than their rights in relation to
holders of Senior Indebtedness; or (iii) prevent the Trustee or any Holder from exercising its
available remedies upon a Default or Event of Default, subject to the rights of holders and owners
of Senior Indebtedness to receive distributions and payments otherwise payable to Holders of Notes.
If the Company fails because of this Article 11 to pay principal of or interest on a Note on the
Stated Maturity Date, the failure is still a Default or Event of Default.

          SECTION 11.09 Subordination May Not Be Impaired by the Company. No right of any
holder of Senior Indebtedness to enforce the subordination of the Indebtedness evidenced by the
Notes shall be impaired by any act or failure to act by the Company or any Holder or by the failure
of the Company or any Holder to comply with this Indenture.

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          Without in any way limiting the generality of this Section 11.09, the holders of Senior
Indebtedness may, at any time and from time to time, without the consent of or notice to the
Trustee or the Holders, without incurring responsibility to the Trustee or the Holders and without
impairing or releasing the subordination provided in this Article 11 or the obligations hereunder
of the Holders to the holders of Senior Indebtedness, do any one or more of the following: (a)
change the manner, place or terms of payment or extend the time of payment of, or renew or alter,
Senior Indebtedness or any instrument evidencing the same or any agreement under which Senior
Indebtedness is outstanding or secured; (b) sell, exchange, release, foreclose against or otherwise
deal with any property pledged, mortgaged or otherwise securing Senior Indebtedness; (c) release
any Person liable in any manner for the collection of Senior Indebtedness; and (d) exercise or
refrain from exercising any rights against the Company, and Subsidiary thereof or any other Person.

          SECTION 11.10 Distribution or Notice to Representative. Whenever a distribution is to
be made or a notice given to holders of any Senior Indebtedness, the distribution may be made and
the notice given to their trustee or representative.

          Upon any payment or distribution of assets of the Company referred to in this Article 11, the
Trustee and the Holders of Notes shall be entitled to rely upon any order or decree made by any
court of competent jurisdiction or upon any certificate of such representative(s) or of the
liquidating trustee or agent or other Person making any distribution to the Trustee or to the
Holders for the purpose of ascertaining the Persons entitled to participate in such distribution,
all holders of the 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 11.

          SECTION 11.11 Rights of Trustee and Paying Agent. Notwithstanding the provisions of
this Article 11 or any other provision of this Indenture, the Trustee shall not be charged with
knowledge of the existence of any facts that would prohibit the making of any payment or
distribution by the Trustee, and the Trustee and the Paying Agent may continue to make payments on
the Notes, unless a Responsible Officer of the Trustee shall have received at its Corporate Trust
Office at least three Business Days prior to the date of such payment written notice of facts that
would cause the payment of any obligations with respect to the Notes to violate this Article 11.
Only the Company or any representative of the holders of Senior Indebtedness may give the notice.
Nothing in this Article 11 shall impair the claims of, or payments to, the Trustee under or
pursuant to Section 7.06.

          The Trustee in its individual or any other capacity may hold Senior Indebtedness with the same
rights it would have if it were not Trustee.

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ARTICLE 12

RESERVED

ARTICLE 13

MISCELLANEOUS

          SECTION 13.01 Trust Indenture Act Controls. If any provision of this Indenture
limits, qualifies, or conflicts with another provision which is required to be included in this
Indenture by the TIA, the required provision shall control.

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

     if to the Company:

Finisar Corporation

1389 Moffett Park Drive

Sunnyvale, CA 94089

Attention: Chief Financial Officer

Telephone No.: (408) 548-1000

Facsimile No.: (408) 541-4154

     if to the Trustee:

U.S. Bank Trust National Association

100 Wall Street, 16th Floor

New York, New York 10005

Attention: Corporate Trust Administration

Telephone No.: (212) 361-6184

Facsimile No.: (212) 809-5459

          The Company or the Trustee by notice given to the other in the manner provided above may
designate additional or different addresses for subsequent notices or communications.

          Any notice or communication given to a Noteholder shall be mailed to the Noteholder, by
first-class mail, postage prepaid, at the Noteholder’s address as it appears on the registration
books of the Registrar and shall be sufficiently given if so mailed within the time prescribed.

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

          If the Company mails a notice or communication to the Noteholders, it shall mail a copy to the
Trustee and each Registrar, Paying Agent, Conversion Agent or co-registrar.

79

 

           SECTION 13.03 Communication by Holders with Other Holders. Noteholders may
communicate pursuant to TIA Section 312(b) with other Noteholders with respect to their rights
under this Indenture or the Notes. The Company, the Trustee, the Registrar, the Paying Agent, the
Conversion Agent and anyone else shall have the protection of TIA Section 312(c).

           SECTION 13.04 Certificate and Opinion as to Conditions Precedent. 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, if the Trustee so requests:

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

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

           SECTION 13.05 Statements Required in Certificate or Opinion. Each Officers’
Certificate or Opinion of Counsel with respect to compliance with a covenant or condition provided
for in this Indenture shall include:

     (1) a statement that each person making such Officers’ Certificate or Opinion of
Counsel has read such covenant or condition;

     (2) a brief statement as to the nature and scope of the examination or investigation
upon which the statements or opinions contained in such Officers’ Certificate or Opinion of
Counsel are based;

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

     (4) a statement that, in the opinion of such person, such covenant or condition has
been complied with.

           SECTION 13.06 Separability Clause. In case any provision in this Indenture or in the
Notes 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 13.07 Rules by Trustee, Paying Agent, Conversion Agent and Registrar. The
Trustee may make reasonable rules for action by or a meeting of Noteholders. The Registrar,
Conversion Agent and the Paying Agent may make reasonable rules for their functions.

           SECTION 13.08 Legal Holidays. A “Legal Holiday” is any day other than a Business Day.
If any specified date (including a date for giving notice) is a Legal Holiday, the action shall be
taken on the next succeeding day that is not a Legal Holiday, and, if the action to

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be taken on such date is a payment in respect of the Notes, no interest, if any, shall accrue
for the intervening period.

          SECTION 13.09 GOVERNING LAW. THIS INDENTURE AND THE NOTES WILL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO CONFLICTS
OF LAW PRINCIPLES.

          SECTION 13.10 No Recourse Against Others. A director, officer, employee or
stockholder, as such, of the Company shall not have any liability for any obligations of the
Company under the Notes or this Indenture or for any claim based on, in respect of or by reason of
such obligations or their creation. By accepting a Note, each Noteholder shall waive and release
all such liability. The waiver and release shall be part of the consideration for the issue of the
Notes.

          SECTION 13.11 Successors. All agreements of the Company in this Indenture and the
Notes shall bind its successor. All agreements of the Trustee in this Indenture shall bind its
successor.

          SECTION 13.12 Multiple Originals. The parties may sign any number of copies of this
Indenture. Each signed copy shall be an original, but all of them together represent the same
agreement. One signed copy is enough to prove this Indenture.

[Remainder of Page Intentionally Left Blank]

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          IN WITNESS WHEREOF, the undersigned, being duly authorized, have executed this Indenture on
behalf of the respective parties hereto as of the date first above written.

	 	 	 	 	 	 	 	 
	 	 	FINISAR CORPORATION
	 
	 	 	 	 	 	 
	 

	 	By:
	 	 	 	/s/ Jerry S. Rawls
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Jerry S. Rawls
	 

	 	 	 	Title:
	 	President and CEO

	 	 	 	 	 
	 	U.S. BANK TRUST NATIONAL ASSOCIATION,

as Trustee

 	 
	 	By:  	/s/ Thomas E. Tabor 	 
	 	 	Name:  	Thomas E. Tabor 	 
	 	 	Title:  	Vice President 	 
	 

 

 

EXHIBIT A-1

FORM OF FACE OF GLOBAL NOTE

     UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY TO THE ISSUER 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.

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

     THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”). THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, AGREES FOR THE BENEFIT OF THE
COMPANY THAT THIS SECURITY MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE
EXPIRATION OF THE HOLDING PERIOD UNDER RULE 144(k) (OR ANY SUCCESSOR THERETO) UNDER THE SECURITIES
ACT WHICH IS APPLICABLE TO THIS SECURITY OR (Y) BY ANY HOLDER THAT WAS AN “AFFILIATE” (WITHIN THE
MEANING OF RULE 144 UNDER THE SECURITIES ACT) OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS
PRECEDING THE DATE OF SUCH RESALE, PLEDGE OR OTHER TRANSFER, IN EITHER CASE, OTHER THAN (1) TO THE
COMPANY, (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT (“RULE 144A”), TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, PURCHASING FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (3) TO AN INSTITUTION THAT IS AN “ACCREDITED
INVESTOR” AS DEFINED IN RULE 501 (a) (1), (2) OR (7) UNDER THE SECURITIES ACT (“INSTITUTIONAL
ACCREDITED INVESTOR”) THAT IS ACQUIRING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR
DISTRIBUTION AND IN A PRINCIPAL AMOUNT OF AT LEAST $250,000, AND THAT, PRIOR TO SUCH TRANSFER,
DELIVERS TO THE COMPANY AND THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE FORM OF
WHICH LETTER MAY BE OBTAINED FROM THE TRUSTEE),

A-1-1

 

(4) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
PROVIDED BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT OR (5) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. PRIOR TO A TRANSFER OF THIS SECURITY (OTHER THAN
A TRANSFER PURSUANT TO CLAUSE (5) ABOVE), THE HOLDER OF THIS SECURITY MUST, PRIOR TO SUCH TRANSFER,
FURNISH TO THE COMPANY AND THE TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AND, IN THE
CASE OF A TRANSFER PURSUANT TO CLAUSE (3) ABOVE, A LEGAL OPINION AS THEY MAY REASONABLY REQUIRE TO
CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE FOREGOING RESTRICTIONS. THE
HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF THE COMPANY
THAT IT IS (1) A QUALIFIED INSTITUTIONAL BUYER OR (2) AN INSTITUTIONAL ACCREDITED INVESTOR AND THAT
IT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION.

A-1-2

 

FINISAR CORPORATION

21/2% Convertible Senior Subordinated Notes due 2010

No.: __               
                            CUSIP NO.: Restricted Note — 31787AAG6

When
the Note is no longer restricted — 31787AAH4

Issue Date: October 12, 2006

     FINISAR CORPORATION, a Delaware corporation, promises to pay to Cede & Co. or registered
assigns, the principal sum of [___] DOLLARS ($[___]) on October ___, 2010.

     This Note shall bear interest as specified on the other side of this Note. This Note is
convertible as specified on the other side of this Note.

     Additional provisions of this Note are set forth on the other side of this Note.

	 	 	 	 	 
	Dated: October 12, 2006	 	FINISAR CORPORATION
	 
	 	 	 	 
	 

	 	By	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:

TRUSTEE’S CERTIFICATE OF

AUTHENTICATION

U.S. BANK TRUST NATIONAL ASSOCIATION,

as Trustee, certifies that this

is one of the Notes referred

to in the within-mentioned Indenture (as

defined on the other side of this Note).

By                                               

          Authorized Signatory

Dated:                           

A-1-3

 

FORM OF REVERSE SIDE OF NOTE

21/2% Convertible Senior Subordinated Note due 2010

     Capitalized terms used herein but not defined shall have the meanings assigned to them in the
Indenture unless otherwise indicated.

1. Cash Interest.

     The Company promises to pay interest at the Interest Rate in cash on the principal amount of
this Note. The Company will pay cash interest semiannually in arrears on April 15 and October 15,
of each year (each an “Interest Payment Date”), beginning on April 15, 2007, to Holders of record
at the close of business on the preceding April 1 and October 1 (whether or not a business day)
(each a “Regular Record Date”), as the case may be, immediately preceding such Interest Payment
Date. Cash interest on the Notes will accrue from the most recent date to which interest has been
paid or duly provided or, if no interest has been paid, from the Issue Date. Cash interest will be
computed on the basis of a 360-day year of twelve 30-day months. The Company shall pay cash
interest on overdue principal, or if shares of Common Stock (or cash in lieu of fractional shares)
in respect of a conversion of this Note in accordance with the terms of Article 10 of the Indenture
are not delivered when due, at the rate borne by the Notes, and it shall pay interest in cash on
overdue installments of cash interest at the same rate to the extent lawful. All such overdue cash
interest shall be payable on demand.

     In accordance with the terms of the Registration Rights Agreement, if:

	 	(A)	 	on the 61st day after the earliest date of original issuance of any of the
Notes, the Shelf Registration Statement has not been filed with the Commission;
	 
	 	(B)	 	on the 181st day following the earliest date of original issuance of any of
the Notes, the Shelf Registration Statement is not declared effective;
	 
	 	(C)	 	the Shelf Registration Statement, previously declared effective, shall cease to be
effective or usable without being succeeded within five Business Days by a post effective
amendment or report filed with the Commission pursuant to the Exchange Act that cures the
failure of the Shelf Registration Statement to be effective or usable; or
	 
	 	(D)	 	the Company suspends the use of any prospectus relating to the Shelf Registration
Statement for a period exceeding 30 days in any three-month period or exceeding an
aggregate of 90 days in any 12-month period,

(each, a “Registration Default”) additional interest in the form of Liquidated Damages will accrue
from and including the day of the Registration Default to, but excluding, the day on which the
Registration Default has been cured. To and including the 90th day following such
Registration Default, additional interest in the form of Liquidated Damages will accrue on the
Notes at a rate per year equal to 0.25%. From and after the 91st day following such
Registration Default, additional interest in the form of Liquidated Damages will accrue on the
Notes at a rate per year equal to 0.50%. In no event shall the additional interest in the form of
Liquidated Damages borne by the Notes be more than 0.50% per annum. Any amount of Liquidated

A-1-4

 

Damages will be payable in cash semiannually, in arrears, on each Interest Payment Date and will
cease to accrue on the date the Registration Default is cured. The Holder of this Note is entitled
to the benefits of the Registration Rights Agreement.

2. Method of Payment.

     Subject to the terms and conditions of the Indenture, the Company will make payments in
respect of the principal of and cash interest on this Note and in respect of Provisional Redemption
Prices, and Change in Control Repurchase Prices to Holders who surrender Notes to a Paying Agent to
collect such payments in respect of the Notes. The Company will pay cash amounts in money of the
United States that at the time of payment is legal tender for payment of public and private debts.
However, the Company may make such cash payments by check payable in such money. A Holder with an
aggregate principal amount in excess of $5,000,000 will be paid by wire transfer in immediately
available funds at the election of such Holder. Any payment required to be made on any day that is
not a Business Day will be made on the next succeeding Business Day.

3. Paying Agent, Conversion Agent and Registrar.

     Initially, U.S. Bank Trust National Association (the “Trustee”) will act as Paying Agent,
Conversion Agent and Registrar. The Company may appoint and change any Paying Agent, Conversion
Agent, Registrar or co-registrar without notice, other than notice to the Trustee. The Company or
any of its Subsidiaries or any of their Affiliates may act as Paying Agent, Conversion Agent,
Registrar or co-registrar.

4. Indenture.

     The Company issued the Notes under an Indenture, dated as of October 12, 2006 (the
“Indenture”), between the Company and the Trustee. The terms of the Notes include those stated in
the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939,
as in effect from time to time (the “TIA”). Capitalized terms used herein and not defined herein
have the meanings ascribed thereto in the Indenture. The Notes are subject to all such terms, and
Noteholders are referred to the Indenture and the TIA for a statement of those terms.

     The Notes are general unsecured obligations of the Company limited to an aggregate principal
amount of $100,000,000 (subject to Section 2.07 of the Indenture). The Indenture does not limit
other indebtedness of the Company, secured or unsecured.

5. Provisional Redemption.

     The Notes may be redeemed at the election of the Company, in whole at any time or in part from
time to time, upon at least 30 but not more than 60 days’ notice, at any time on or after October
15, 2007, at a redemption price equal to 100% if the principal amount of the Notes redeemed plus
accrued and unpaid interest, if any, to but excluding the applicable Provisional Redemption Date
(provided however, if such Provisional Redemption Date is an Interest Payment Date, the interest
due on such Interest Payment Date shall be payable to the Holder of the Notes called for redemption
and the Provisional Redemption Price shall not include such interest payment), if the Closing Price
of the Common Stock has exceeded 150% of the

A-1-5

 

Conversion Price then in effect for at least 20 Trading Days in the consecutive 30-Trading
Day period ending on the Trading Day immediately preceding the Notice Date.

6. Notice of Redemption.

     Notice of the Provisional Redemption will be mailed at least 30 days but not more than 60 days
before a Provisional Redemption Date to each Holder of Notes to be redeemed at the Holder’s
registered address. If money sufficient to pay the Provisional Redemption Price of all Notes (or
portions thereof) to be redeemed on a Provisional Redemption Date is deposited with the Paying
Agent prior to or on such Provisional Redemption Date, immediately after such Provisional
Redemption Date interest ceases to accrue on such Notes or portions thereof. Notes in
denominations larger than $1,000 of principal amount may be redeemed in part but only in whole
multiples of $1,000 of principal amount.

7. Sinking Fund

     No sinking fund is provided for the Notes.

8. Repurchase by the Company at the Option of the Holder Upon a Change in Control.

     If a Change in Control occurs, the Holder, at the Holder’s option, shall have the right, in
accordance with the provisions of the Indenture, to require the Company to repurchase this Note (or
any portion of the principal amount hereof that is at least $1,000 or any whole multiple thereof,
provided that the portion of the principal amount of this Note to be outstanding after such
repurchase is at least equal to $1,000) at the Change in Control Repurchase Price in cash or Common
Stock or a combination thereof.

     Subject to the conditions provided in the Indenture, the Company may elect to pay the Change
in Control Repurchase Price (to the extent not paid in cash) by delivering a number of shares of
Common Stock equal to (i) the Change in Control Repurchase Price divided by (ii) 95% of the average
of the Closing Prices per share for the five consecutive Trading Days immediately preceding and
including the third Trading Day prior to the Change in Control Repurchase Date.

     No fractional shares of Common Stock will be issued upon repurchase of any Notes. Instead of
any fractional share of Common Stock, which would otherwise be issued upon conversion of such
Notes, the Company shall pay a cash adjustment as provided in the Indenture.

     A Company Change in Control Notice will be given by the Company to the Holders as provided in
the Indenture. To exercise a repurchase right, a Holder must deliver to the Paying Agent a Change
in Control Repurchase Notice as provided in the Indenture.

     Holders have the right to withdraw any Change in Control Repurchase Notice by delivering to
the Paying Agent a written notice of withdrawal in accordance with the provisions of the Indenture.

A-1-6

 

9. Conversion.

     Subject to and upon compliance with the provisions of the Indenture including, without
limitation, the provisions of Section 10.01(a) of the Indenture, and upon the occurrence of the
events specified in the Indenture, a Holder may surrender for conversion any Note that is $1,000
principal amount or integral multiples thereof; provided, however, that if the Note is called for
redemption, the conversion right will terminate at the close of business on the Business Day
immediately preceding the Provisional Redemption Date for such Note or such earlier date as the
Holder presents such Note for redemption (unless the Company shall default in paying the
Provisional Redemption Price when due, in which case the conversion right shall terminate at the
close of business on the date such default is cured and such Note is redeemed). In lieu of
receiving shares of Common Stock, a Holder will receive, for each $1,000 principal amount of Notes
surrendered for conversion:

	 	—	 	cash in an amount equal to the lesser of (1) $1,000 and (2) the Conversion
Value; and
	 
	 	—	 	if the Conversion Value is greater than $1,000, a number of shares of Common
Stock equal to the sum of the Daily Share Amounts, for each of the twenty consecutive
Trading Days in the Conversion Reference Period, appropriately adjusted to reflect
stock splits, stock dividends, combinations or similar events occurring during the
Conversion Reference Period.

     The Conversion Rate on any Notes surrendered in connection with a Change in Control may be
increased by an amount, if any, determined in accordance with Section 10.01(f) of the Indenture.

     A Note in respect of which a Holder had delivered a Change in Control Repurchase Notice,
exercising the option of such Holder to require the Company to repurchase such Note, may be
converted only if the Change in Control Repurchase Notice is withdrawn in accordance with the terms
of the Indenture.

     The initial Conversion Price shall be equal to approximately $3.28 per share of Common Stock,
subject to adjustment in certain events described in the Indenture. The Company shall pay a cash
adjustment as provided in the Indenture in lieu of any fractional share of Common Stock.

     To convert a Note, a Holder must (1) complete and manually sign the conversion notice below
(or complete and manually sign a facsimile of such notice) and deliver such notice to the
Conversion Agent, (2) surrender the Note to the Conversion Agent, (3) furnish appropriate
endorsements and transfer documents if required by the Conversion Agent, the Company or the Trustee
and (4) pay any transfer or similar tax, if required.

10. Conversion Arrangement on Call for Redemption.

     Any Notes called for redemption, unless surrendered for conversion before the close of
business on the Business Day preceding the applicable Provisional Redemption Date, may be purchased
from the Holders of such Notes at an amount not less than the Provisional Redemption Price by one
or more investment bankers or other purchasers who may agree with the Company

A-1-7

 

to purchase such Notes from the Holders, to convert them into Common Stock of the Company and
to make payment for such Notes to the Trustee in trust for such Holders.

11. Denominations; Transfer; Exchange.

     The Notes are in fully registered form, without coupons, in denominations of $1,000 of
principal amount and whole multiples of $1,000. A Holder may transfer or exchange Notes in
accordance with the Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay any taxes and fees required by law or
permitted by the Indenture. The Registrar need not transfer or exchange any Notes selected for
redemption (except, in the case of a Note to be redeemed in part, the portion of the Note not to be
redeemed) or any Notes in respect of which a Change in Control Repurchase Notice has been given and
not withdrawn (except, in the case of a Note to be repurchased in part, the portion of the Note not
to be repurchased) or any Notes for a period of 15 days before the mailing of a notice of
redemption of Notes to be redeemed.

12. Persons Deemed Owners.

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

13. Unclaimed Money or Notes.

     The Trustee and the Paying Agent shall return to the Company upon written request any money or
Notes held by them for the payment of any amount with respect to the Notes that remains unclaimed
for two years, subject to applicable unclaimed property law. After return to the Company, Holders
entitled to the money or Notes must look to the Company for payment as general creditors unless an
applicable abandoned property law designates another person.

14. Amendment; Waiver.

     Subject to certain exceptions set forth in the Indenture, (i) the Indenture or the Notes may
be amended with the written consent of the Holders of at least a majority in aggregate principal
amount of the Notes at the time outstanding and (ii) certain Defaults may be waived with the
written consent of the Holders of a majority in aggregate principal amount of the Notes at the time
outstanding. Subject to certain exceptions set forth in the Indenture, without the consent of any
Noteholder, the Company and the Trustee may amend the Indenture or the Notes to cure any ambiguity,
omission, defect or inconsistency, or to comply with Article 5 of the Indenture, to provide for
uncertificated Notes in addition to or in place of certificated Notes, or to modify any provision
in the Indenture or the Notes in order to conform the provision to the corresponding description
set forth in the offering memorandum, or to make any change that does not adversely affect the
rights of any Noteholder or to comply with any requirement of the Commission in connection with the
qualification of the Indenture under the TIA.

15. Defaults and Remedies.

     Under the Indenture, Events of Default include (1) the Company fails to pay when due the
principal of any of the Notes at maturity, upon redemption or exercise of a repurchase right or
otherwise, whether or not such payment is prohibited by Article 11 of the Indenture; (2) the

A-1-8

 

Company fails to pay an installment of interest (including Liquidated Damages, if any) on any
of the Notes that continues for 30 days after the date when due, whether or not such payment is
prohibited by Article 11 of the Indenture; (3) the Company fails to deliver all cash and any shares
of Common Stock when such cash and Common Stock, if any, are required to be delivered upon
conversion of a Note and such failure continues for 10 days after such delivery date; (4) the
Company fails to perform or observe any other term, covenant or agreement contained in the Notes or
the Indenture for a period of 60 days after written notice of such failure, requiring the Company
to remedy the same, shall have been given to the Company by the Trustee or to the Company and the
Trustee by the Holders of at least 25% in aggregate principal amount of the Notes then outstanding;
(5) (A) one or more defaults in the payment of any of the Company’s Indebtedness aggregating $5.0
million or more, when the same becomes due and payable at the scheduled maturity thereof, and such
default or defaults shall have continued after any applicable grace period and shall not have been
cured or waived within 30 days after written notice of such default or defaults shall have been
given to the Company by the Trustee or to the Company and the Trustee by the Holders of at least
25% in aggregate principal amount of the Notes then outstanding or (B) any of the Company’s
Indebtedness aggregating $5.0 million or more shall have been accelerated or otherwise declared due
and payable, or required to be prepaid or repurchased (other than by regularly scheduled required
prepayment) prior to the scheduled maturity thereof and such acceleration is not cured, waived,
rescinded nor annulled within 30 days after written notice of such default or defaults shall have
been given to the Company by the Trustee or to the Company and the Trustee by the Holders of at
least 25% in aggregate principal amount of the Notes then outstanding; and (6) certain events of
bankruptcy, insolvency or reorganization with respect to the Company or any Significant Subsidiary.
If an Event of Default (other than an Event of Default specified in clause (6) or (7) of Section
6.01 of the Indenture) occurs and is continuing, the Trustee, or the Holders of at least 25% in
aggregate principal amount of the Notes at the time outstanding, may declare all the Notes to be
due and payable immediately. Certain events of bankruptcy or insolvency are Events of Default that
will result in the Notes becoming due and payable immediately upon the occurrence of such Events of
Default.

     Noteholders may not enforce the Indenture or the Notes, except as provided in the Indenture.
The Trustee may refuse to enforce the Indenture or the Notes unless it receives reasonable
indemnity or security. Subject to certain limitations, Holders of a majority in aggregate
principal amount of the Notes at the time outstanding may direct the Trustee in its exercise of any
trust or power. The Trustee may withhold from Noteholders notice of any continuing Default (except
a Default in payment of amounts specified in clause (1) or (2) above) if it determines that
withholding notice is in their interests.

16. Subordination

     The payment of principal of and interest on the Notes will be subordinated in right of
payment, as set forth in the Indenture, to the prior payment in full in cash or cash equivalents
(or otherwise to the extent holders of Senior Indebtedness accept satisfaction of amounts due by
settlement in other than cash or cash equivalents) of all Senior Indebtedness whether outstanding
on the date of the Indenture or thereafter incurred.

A-1-9

 

17. Trustee Dealings with the Company.

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

18. Reserved.

19. No Recourse Against Others.

     A director, officer, employee or stockholder, as such, of the Company shall not have any
liability for any obligations of the Company under the Notes or the Indenture or for any claim
based on, in respect of or by reason of such obligations or their creation. By accepting a Note,
each Noteholder waives and releases all such liability. The waiver and release are part of the
consideration for the issue of the Notes.

20. Authentication.

     This Note shall not be valid until an authorized signatory of the Trustee manually signs the
Trustee’s Certificate of Authentication on the other side of this Note.

21. Abbreviations.

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

22. Designated Senior Debt.

     This Note shall be “Designated Senior Indebtedness” for purposes of the indentures governing
the Company’s Convertible Subordinated Notes.

23. GOVERNING LAW.

     THE INDENTURE AND THIS NOTE WILL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO CONFLICTS OF LAW PRINCIPLES.

 

     The Company will furnish to any Noteholder upon written request and without charge a copy of
the Indenture that has in it the text of this Note in larger type. Requests may be made to:

Finisar Corporation

1389 Moffett Park Drive

Sunnyvale, CA 94089

Attention: Chief Financial Officer

A-1-10

 

ASSIGNMENT FORM

To assign this Note, fill in the form below:

I or we assign and transfer this Note to

 

 

(Insert assignee’s social sec. or tax ID no.)

 

 

 

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

And irrevocably appoint

                     agent to transfer this Note
on the books of the Company. The agent may
substitute another to act for him.

CONVERSION NOTICE

To convert this Note into Common
Stock of the Company, check the
box:

o

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

$                                        

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

 

 

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

 

 

 

 

(Print or type other person’s
name, address and zip code)

 

Date:                                          Your Signature:                        
              
                       

 

(Sign exactly as your name appears on the other side of this Note)

A-1-11

 

EXHIBIT A-2

Form of Certificated Note

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”). THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT
THIS SECURITY MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE EXPIRATION OF
THE HOLDING PERIOD UNDER RULE 144(k) (OR ANY SUCCESSOR THERETO) UNDER THE SECURITIES ACT WHICH IS
APPLICABLE TO THIS SECURITY OR (Y) BY ANY HOLDER THAT WAS AN “AFFILIATE” (WITHIN THE MEANING OF
RULE 144 UNDER THE SECURITIES ACT) OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING THE
DATE OF SUCH RESALE, PLEDGE OR OTHER TRANSFER, IN EITHER CASE, OTHER THAN (1) TO THE COMPANY, (2)
SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT
(“RULE 144A”), TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
WITHIN THE MEANING OF RULE 144A, PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE
IN RELIANCE ON RULE 144A, (3) TO AN INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE
501 (a) (1), (2) OR (7) UNDER THE SECURITIES ACT (“INSTITUTIONAL ACCREDITED INVESTOR”) THAT IS
ACQUIRING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION AND IN A PRINCIPAL AMOUNT
OF AT LEAST $250,000, AND THAT, PRIOR TO SUCH TRANSFER, DELIVERS TO THE COMPANY AND THE TRUSTEE A
SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON
TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH LETTER MAY BE OBTAINED FROM THE
TRUSTEE), (4) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
PROVIDED BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT OR (5) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. PRIOR TO A TRANSFER OF THIS SECURITY (OTHER THAN
A TRANSFER PURSUANT TO CLAUSE (5) ABOVE), THE HOLDER OF THIS SECURITY MUST, PRIOR TO SUCH TRANSFER,
FURNISH TO THE COMPANY AND THE TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AND, IN THE
CASE OF A TRANSFER PURSUANT TO CLAUSE (3) ABOVE, A LEGAL OPINION AS THEY MAY REASONABLY REQUIRE TO
CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE FOREGOING RESTRICTIONS. THE
HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF THE COMPANY
THAT IT IS (1) A QUALIFIED INSTITUTIONAL BUYER OR (2) AN INSTITUTIONAL ACCREDITED INVESTOR AND THAT
IT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION.

A-2-1

 

     THE FOREGOING LEGEND MAY BE REMOVED FROM THIS NOTE ON SATISFACTION OF THE CONDITIONS SPECIFIED
IN THE INDENTURE.

A-2-2

 

FINISAR CORPORATION

21/2% Convertible Senior Subordinated Notes due 2010

No.: __               
                            CUSIP NO.: Restricted Note—31787AAG6

When
the Note is no longer restricted—31787AAH4

Issue Date: October 12, 2006

     FINISAR CORPORATION, a Delaware corporation, promises to pay to Cede & Co. or registered
assigns, the principal sum of [___] DOLLARS ($[___]) on October ___, 2010.

     This Note shall bear interest as specified on the other side of this Note. This Note is
convertible as specified on the other side of this Note.

     Additional provisions of this Note are set forth on the other side of this Note.

	 	 	 	 	 
	Dated: October 12, 2006

	 	FINISAR CORPORATION
	 
	 	 	 	 
	 

	 	By	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:

TRUSTEE’S CERTIFICATE OF

AUTHENTICATION

U.S. BANK TRUST NATIONAL ASSOCIATION,

as Trustee, certifies that this

is one of the Notes referred

to in the within-mentioned Indenture (as

defined on the other side of this Note).

By                                                 

           Authorized Signatory

Dated:                                           

A-2-3

 

Text of Reverse Side of Note

Use Exhibit A-1 Text

A-2-4

 

EXHIBIT B-1

Transfer Certificate

     In connection with any transfer of any of the Notes within the period prior to the expiration
of the holding period applicable to the sales thereof under Rule 144(k) under the Securities Act of
1933, as amended (the “Securities Act”) (or any successor provision), the undersigned registered
owner of this Note hereby certifies with respect to $___principal amount of the
above-captioned Notes presented or surrendered on the date hereof (the “Surrendered Notes”) for
registration of transfer, or for exchange or conversion where the Notes issuable upon such exchange
or conversion are to be registered in a name other than that of the undersigned registered owner
(each such transaction being a “transfer”), that such transfer complies with the restrictive legend
set forth on the face of the Surrendered Notes for the reason checked below:

      ̈ A transfer of the Surrendered Notes is made to the Company or any Subsidiaries; or

      ̈ The transfer of the Surrendered Notes complies with Rule 144A under the U.S.
Securities Act of 1933, as amended (the “Securities Act”); or

      ̈ The transfer of the Surrendered Notes is pursuant to an effective registration
statement under the Securities Act, or

      ̈ The transfer of the Surrendered Notes is pursuant to another available exemption from
the registration requirement of the Securities Act.

and unless the box below is checked, the undersigned confirms that, to the undersigned’s knowledge,
such Notes are not being transferred to an “affiliate” of the Company as defined in Rule 144 under
the Securities Act (an “Affiliate”).

      ̈ The transferee is an Affiliate of the Company.

DATE:

Signature(s)

(If the registered owner is a corporation, partnership or

fiduciary, the title of the Person signing on behalf of

such registered owner must be stated.)

B-1-1

 

EXHIBIT C

FORM OF NOTICE OF HOLDER TO ELECT REPURCHASE UPON A CHANGE IN CONTROL

OPTION OF HOLDER TO ELECT REPURCHASE UPON A CHANGE IN CONTROL

To: U.S. Bank Trust National Association, as Paying Agent

cc: Finisar Corporation

     This notice relates to the 21/2% Convertible Senior Subordinated Notes due 2010 (the “Notes”) of
Finisar Corporation, a Delaware Corporation (the “Company”), issued pursuant to an Indenture (the
“Indenture”), dated as of October 12, 2006, between the Company and U.S. Bank Trust National
Association, as trustee. Capitalized terms not otherwise defined herein shall have the meanings
ascribed to them in the Indenture.

     The undersigned registered owner of the Note (the “Undersigned”) hereby irrevocably
acknowledges receipt of a notice from the Company as to the occurrence of a Change in Control with
respect to the Company and requests and instructs the Company to repurchase the entire principal
amount of the Note, or the portion thereof (which is $1,000 or a whole multiple thereof) below
designated, in accordance with Section 3.10 of the Indenture and paragraph 8 on the reverse side of
the Notes at the Change in Control Repurchase Price, together with accrued interest to, but
excluding, such date.

     If the Notes have been certificated, the certificate number of the Note which the Undersigned
hereby surrenders for repurchase is: ___

     If the Notes are in book-entry form, the following is the name of the broker, dealer or other
person through whom the Undersigned owns the Notes: ___

     If the Company elects, pursuant to Section 3.10(d) of the Indenture, to pay the Change in
Control Repurchase Price, in whole or in part, in shares of Common Stock but such portion of the
Change in Control Repurchase Price shall ultimately be payable to the Undersigned entirely in cash
because any of the conditions to payment of the Change in Control Price (or a portion there of) in
Common Stock, as set forth in Section 3.10(f), is not satisfied prior to the close of business on
such Repurchase Date, the Undersigned hereby elects:

     [ ___] to withdraw this notice as to some or all of the Note (The principal amount of the
Note as to which such withdrawal shall relate is $___. If the undersigned does not
indicate the principal amount of the Note to which such withdrawal relates, then such withdrawal
shall relate to all of the Note); and, if certificated, the following is the certificate number of
the Notes as to which such withdrawal shall relate: ___, or

     [ ___] to receive cash in respect of the entire Change in Control Repurchase Price for all
Notes (or portion thereof) to which this notice relates.

C-2-1

 

The Undersigned acknowledges and agrees that, if the undersigned fails to hereby indicate his/her
choice with respect to the foregoing election, the Undersigned will be deemed to have elected to
receive cash in respect of the entire Change in Control Repurchase Price for all Notes subject to
this notice under the foregoing circumstances described in this paragraph.

Dated:                     

	 	 	 
	 

	 	 

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

	 	 

Signature Guaranty

Principal amount to be repurchased

(in a whole multiple of $1,000, if less than all):

                                        

NOTICE: The signature to the foregoing election must correspond to the name as written upon
the face of the Note in every particular, without alteration or any change whatsoever.

C-2-2

 

EXHIBIT D

Form of Accredited Investor Representation Letter

Finisar Corporation

1389 Moffett Drive

Sunnyvale, California 94089

U.S. Bank Trust National Association

100 Wall Street, 16th Floor

New York, New York 10005

Ladies and Gentlemen:

       We are delivering this letter in connection with the proposed transfer of $___
principal amount of the 21/2% Convertible Senior Subordinated Notes due 2010 (the “Notes”) of Finisar
Corporation (the “Company”), which are convertible into shares of the Company’s Common Stock, no
par value per share (the “Common Stock”).

            We hereby confirm that:

     1. we are an institutional “accredited investor” within the meaning of Rule 501(a)(1),
(2), (3) or (7) of Regulation D under the Securities Act of 1933, as amended (the
“Securities Act”) (an “Institutional Accredited Investor”);

     2. any purchase of the securities by us will be for our own account or for the account
of one or more other institutional accredited investors for which we exercise sole
investment discretion;

     3. in the event that we purchase any of the securities, we will acquire securities
having a minimum principal amount of not less than $250,000 for our own account or for any
separate account for which we are acting;

     4. we have such knowledge and experience in financial and business matters that we are
capable of evaluating the merits and risks of purchasing the securities;

     5. we are not acquiring the securities with a view to distribution thereof or with any
present intention of offering or selling any of the securities, except inside the United
States in accordance with Rule 144A under the Securities Act, as provided below; provided
that the disposition of our property and the property of any accounts for which we are
acquiring securities shall remain at all times within our control; and

     6. we have received a copy of the offering memorandum relating to the offering of the
securities and acknowledge that we have had access to such financial and other information,
and have been afforded the opportunity to ask such questions of

D-1

 

representatives of the Company and receive answers thereto, as we deem necessary in
connection with our decision to purchase the securities.

       We understand and agree (x) that the Notes were originally offered only in a transaction not
involving any public offering within the meaning of the Securities Act; and (y) that (A) if we
decide to resell, pledge or otherwise transfer any such Notes or any shares of Common Stock
issuable upon conversion thereof prior to the later of (1) the expiration of the holding period
under Rule 144(k) (or any successor thereto) under the Securities Act which is applicable to such
Notes or shares of Common Stock, as the case may be (the date on which such holding period shall
expire with respect to any Note or share of Common Stock issued on conversion of notes being
hereinafter called, with respect to such Note or share of Common Stock, as the case may be, the
“Resale Restriction Termination Date”) or (2) three months after we cease to be an affiliate
(within the meaning of Rule 144 under the Securities Act) of Finisar, such Notes or share of Common
Stock issuable upon conversion thereof may be resold, pledged or transferred only (i) to Finisar,
(ii) so long as the Notes are eligible for resale pursuant to Rule 144A under the Securities Act to
a person whom we reasonably believe is a qualified institutional buyer that is purchasing for its
own account or for the account of a qualified institutional buyer to whom notice is given that the
resale, pledge or transfer is being made in reliance on Rule 144A under the Securities Act (iii) to
an institutional accredited investor (“Institutional Accredited Investor”) as defined in Rule
501(a)(1), (2) or (7) under the Securities Act (provided that any resale, pledge or other transfer
of notes to an institutional accredited investor must be in a minimum principal amount of $250,000
of notes), (iv) pursuant to an exemption from registration under the Securities Act provided by
Rule 144 (if applicable) under the Securities Act or (v) pursuant to an effective registration
statement under the Securities Act, in each case in accordance with any applicable securities laws
of any state of the United States, (B) we will, and each subsequent holder is required to, notify
any purchaser of Notes or the Common Stock issued upon conversion thereof of the resale
restrictions referred to in (A) above, if then applicable. and (C) with respect to any transfer of
certificated Notes or of certificates of Common Stock issuable upon conversion of Notes, in either
case prior to the applicable Resale Restriction Termination Date (other than a transfer pursuant to
clause (A) (v) above), we will deliver to Finisar and the trustee (or the transfer agent in the
case of the common stock issuable upon conversion) such certificates and other information and, in
the case of a transfer pursuant to clause (A) (iv) above, a legal opinion as they may reasonably
require to confirm that the transfer by u complies with the foregoing restrictions.

       We acknowledge that you and others will rely upon our confirmations, acknowledgments and
agreements set forth herein, and we agree to notify you promptly in writing if any of our
representations or warranties herein ceases to be accurate and complete.

          THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.

	 	 	 
	Date:                                         

	 	                                                            
	 

	 	(Name of Purchaser)

D-2

 

	 	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:
	 

	 	Address:

D-3exv10w36

 

Exhibit 10.36

EXECUTION COPY

EXCHANGE AGREEMENT

     This Exchange Agreement (this “Agreement”) is made and entered into as of this 6th day
of October, 2006, by and between ___(the “Holder”), and Finisar Corporation, a
Delaware corporation (the “Company”).

RECITALS

     WHEREAS, the Holder currently holds at least $___principal amount of the Company’s
21/2% Convertible Subordinated Notes due 2010 (the “Outstanding Notes”);

     WHEREAS, the Holder desires to exchange the Outstanding Notes for an equal principal amount of
the Company’s 21/2% Convertible Senior Subordinated Notes due 2010 (the “New Notes”) on the
terms and conditions set forth in this Agreement (the “Exchange Transaction”);

     WHEREAS, the New Notes will be issued pursuant to the Indenture, to be entered into by the
Company and the Trustee named therein (the “Indenture”), substantially in the form of
Exhibit A hereto;

     WHEREAS, the Company desires to issue to the Holder $___principal amount of New
Notes in exchange for the Outstanding Notes in the Exchange Transaction; and

     WHEREAS, in connection with the issuance of the New Notes the Company will agree to provide
the Holder registration rights pursuant to the Registration Rights Agreement, to be entered into by
the Company and the Holder and the other holders of Outstanding Notes exchanging such notes for New
Notes (the “Registration Rights Agreement”), substantially in the form of Exhibit B hereto;

     NOW, THEREFORE, in consideration of the premises and the agreements set forth below, and for
other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:

ARTICLE I

Exchange

     Section 1.1 The Exchange. Upon the terms and subject to the conditions of this
Agreement, at the Closing (as defined herein), the Company shall issue and exchange $___
in aggregate principal amount of New Notes plus all accrued and unpaid interest on the Outstanding
Notes at the day prior to Closing for an equal principal amount of Outstanding Notes.

     Section 1.2 Closing. The closing is anticipated to take place on the third business
day after the date hereof at the offices of the Company, 1389 Moffet Park Drive, Sunnyvale,
California 94089 or on such other date and at such other place as the parties may agree in writing

 

 

(the “Closing”). At the Closing, the Holder shall deliver or cause to be delivered to
the Company all of such Holder’s right, title and interest in and to all of the Outstanding Notes,
and all documentation related thereto, and whatever documents of conveyance or transfer may be
necessary or desirable to transfer to and confirm in the Company all right, title and interest in
and to the Outstanding Notes, and the Company shall issue to the Holder the New Notes and pay to
the Holder in cash by wire transfer of immediately available funds an amount equal to the accrued
and unpaid interest on the Holder’s Outstanding Notes at the day prior to the Closing.

     Section 1.3 Conditions to Closing. This Agreement and the Exchange Transaction shall
become effective upon the satisfaction of the following conditions:

          (a) The Holder and the Company shall have executed and delivered to each other this Agreement;

          (b) The Company and the Trustee shall have executed and delivered the Indenture;

          (c) The Company shall have executed and delivered the New Notes in the principal amount set
forth in Section 1.1;

          (d) The Company and the Holder shall have executed and delivered the Registration Rights
Agreement;

          (e) The Holder shall have delivered, or caused to be delivered, to the Company the Outstanding
Notes being exchanged pursuant to this Agreement;

          (f) The Company shall have submitted an additional share listing application for the shares of
Common Stock issuable upon conversion of the New Notes with the Nasdaq Global Select Market; and

          (g) The Company shall have delivered to the Holder a certificate of the Company, dated the
Closing Date, executed by the secretary of the Company certifying in such capacity and on behalf of
the Company (i) as to the incumbency and signature of the officer of the Company who executed this
Agreement and the New Notes; and (ii) as to the adoption of resolutions of the board of directors
of the Company which are in full force and effect on the Closing Date, authorizing (x) the
execution and delivery of this Agreement and the New Notes; and (y) the performance of the
obligations of the Company hereunder and thereunder.

     Section 1.4 Exchange of Additional Notes. Simultaneously with or after the Closing,
subject to the terms of the Indenture, the Company may issue, to one or more holders of Outstanding
Notes, New Notes in an aggregate principal amount that, together with the New Notes issued pursuant
to this Agreement, does not exceed $100,000,000.

- 2 -

 

ARTICLE II

Representations and Warranties of the Holder

     The Holder hereby makes the following representations and warranties, each of which is true
and correct on the date hereof and shall survive the date of the Closing and the transactions
contemplated hereby to the extent set forth herein.

     Section 2.1 Existence and Power.

          (a) The Holder is duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization and has the power, authority and capacity to execute and deliver
this Agreement, to perform its obligations hereunder, and to consummate the transactions
contemplated hereby.

          (b) The execution of this Agreement by the Holder and the consummation by the Holder of the
transactions contemplated hereby do not and will not constitute or result in a breach, violation or
default under any note, bond, mortgage, deed, indenture, lien, instrument, contract, agreement,
lease or license, whether written or oral, express or implied, or any statute, law, ordinance,
decree, order, injunction, rule, directive, judgment or regulation of any court, administrative or
regulatory body, governmental authority, arbitrator, mediator or similar body on the part of the
Holder or on the part of any other party thereto or cause the acceleration or termination of any
obligation or right of the Holder.

     Section 2.2 Valid and Enforceable Agreement; Authorization. This Agreement has been
duly executed and delivered by the Holder and constitutes a legal, valid and binding obligation of
the Holder, enforceable against the Holder in accordance with its terms, except that such
enforcement may be subject to (a) bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting or relating to enforcement of creditors’ rights generally, and (b) general
principles of equity.

     Section 2.3 Title to Outstanding Notes. The Holder is the sole legal and beneficial
owner of and has good and valid title to the Outstanding Notes, free and clear of any mortgage,
lien, pledge, charge, security interest, encumbrance, title retention agreement, option, equity or
other adverse claim thereto. The Holder has not, in whole or in part, (i) assigned, transferred,
hypothecated, pledged or otherwise disposed of the Outstanding Notes or its rights in such
Outstanding Notes, or (ii) given any person or entity any transfer order, power of attorney or
other authority of any nature whatsoever with respect to such Outstanding Notes.

     Section 2.4 Investment Decision. The Holder is either (i) a “qualified institutional
buyer” within the meaning of Rule 144A under the Securities Act of 1933, as amended (the
“Securities Act”) or (ii) an “accredited investor” within the meaning of Rule 501 of
Regulation D under the Securities Act, and in either case was not organized for the purpose of
acquiring the New Notes or the shares of the Company’s common stock (the “Common Stock”),
$0.001 par value per share, into which the New Notes may be converted (the “Underlying Common
Stock”). The Holder (or its authorized representative) is familiar with the Company’s
objectives and business plan, has reviewed the Company’s filings with the Securities and Exchange
Commission (the “SEC”), including, without limitation, the Company’s Annual Report on Form
10-K filed on

- 3 -

 

July 14, 2006, the Company’s Quarterly Report on Form 10-Q filed on September 8, 2006, the
Company’s Definitive Proxy Statement filed on August 28, 2006, and the Company’s Current Reports on
Form 8-K filed on June 5, 2006, June 7, 2006 (as amended on August 23, 2006), June 26, 2006, July
7, 2006 and October 2, 2006 (all of such filings with the SEC referred to, collectively, as the
“SEC Documents”), and has had such opportunity to ask questions of and to obtain from
representatives of the Company such information as is necessary to permit it to evaluate the merits
and risks of its investment in the Company and has independently, without reliance upon any
representatives of the Company and based on such information as the Holder deemed appropriate, made
its own analysis and decision to enter into this Agreement. The Holder has had the opportunity to
consult with its accounting, tax, financial and legal advisors to be able to evaluate the risks
involved in the exchange of the Outstanding Notes pursuant hereto and to make an informed
investment decision with respect to such exchange. The Holder acknowledges that the Company is
relying on the truth and accuracy of the foregoing representations and warranties in the offering
of the New Notes to the Holder without having first registered the New Notes or the Underlying
Common Stock under the Securities Act.

     Section 2.5 Purchase Entirely for Own Account. The Holder is acquiring the New Notes
only for investment purposes for its own account. The Holder is not acquiring the Notes with a view
to the resale or distribution of any part thereof, and the Holder has no present intention of
selling, granting any participation in, or otherwise distributing the same. The Holder does not
presently have any contract, undertaking, agreement or arrangement with any person to sell,
transfer or grant participations to such person or to any third person, with respect to any of the
New Notes.

     Section 2.6 Restricted Securities. The Holder understands that neither the New Notes
nor the Underlying Common Stock have been registered under the Securities Act, by reason of a
specific exemption from the registration provisions of the Securities Act which depends upon, among
other things, the bona fide nature of the investment intent and the accuracy of the Holder’s
representations as expressed herein. The Holder understands that the New Notes (and the Underlying
Common Stock) are “restricted securities” under applicable U.S. federal and state securities laws
and that, pursuant to these laws, the Holder must hold the New Notes (and the Underlying Common
Stock) indefinitely unless they are registered with the SEC and qualified by state authorities, or
an exemption from such registration and qualification requirements is available. The Holder further
acknowledges that if an exemption from registration or qualification is available, it may be
conditioned on various requirements including, but not limited to, the time and manner of sale, the
holding period for the New Notes (and the Underlying Common Stock), and on requirements relating to
the Company which are outside the Holder’s control, and which the Company is under no obligation
and may not be able to satisfy.

     Section 2.7 No Public Market. The Holder understands that no public market now exists
for the New Notes, and that the Company has made no assurance that a public market will ever exist
for the New Notes.

     Section 2.8 Legends. The Holder understands that the New Notes and any shares of
Underlying Common Stock will bear one or more of the legends required by the Indenture, and the
removal of such legends shall be governed by the terms of the Indenture.

- 4 -

 

     Section 2.9 Affiliate Status. The Holder is not, and has not been during the
preceding three months, an “affiliate” of the Company as such term is defined in Rule 144 under the
Securities Act.

ARTICLE III

Representations, Warranties and Covenants of the Company

     The Company hereby makes the following representations, warranties, and covenants each of
which is true and correct on the date hereof and shall survive the date of the Closing and the
transactions contemplated hereby to the extent set forth herein.

     Section 3.1 Existence and Power.

          (a) The Company is a corporation duly organized, validly existing and in good standing under
the laws of the State of Delaware and has the power, authority and capacity to execute and deliver
this Agreement, to perform the Company’s obligations hereunder, and to consummate the transactions
contemplated hereby.

          (b) The execution of this Agreement by the Company and the consummation by the Company of the
transactions contemplated hereby (i) does not require the consent, approval, authorization, order,
registration or qualification of, or filing with, any governmental authority or court, or body or
arbitrator having jurisdiction over the Company other than the SEC, state securities regulators,
the Nasdaq Global Select Market, The Depository Trust Company and The PORTAL Market; and (ii) does
not and will not constitute or result in a breach, violation or default under any note, bond,
mortgage, deed, indenture, lien, instrument, contract, agreement, lease or license, whether written
or oral, express or implied, or with the Company’s Certificate of Incorporation or by-laws, or any
statute, law, ordinance, decree, order, injunction, rule, directive, judgment or regulation of any
court, administrative or regulatory body, governmental authority, arbitrator, mediator or similar
body on the part of the Company or on the part of any other party thereto or cause the acceleration
or termination of any obligation or right of the Company or any other party thereto.

     Section 3.2 Valid and Enforceable Agreement; Authorization. This Agreement has been
duly executed and delivered by the Company and constitutes a legal, valid and binding obligation of
the Company, enforceable against the Company in accordance with its terms, except that such
enforcement may be subject to (a) bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting or relating to enforcement of creditors’ rights generally, and (b) general
principles of equity.

     Section 3.3 Capitalization. At the Closing, the authorized capital stock of the
Company will consist of 750,000,000 shares of Common Stock, par value $0.001 per share, and
5,000,000 shares of Preferred Stock, par value $0.001 per share, 500,000 shares of which are
designated as Series RP Preferred Stock. The shares of Series RP Preferred Stock are issuable upon
exercise of rights attached to shares of the Company’s Common Stock pursuant to the

- 5 -

 

Rights Agreement dated as of September 25, 2002 between the Company and American Stock
Transfer & Trust Company. As of the close of business on October 2, 2006, there were 307,679,261
shares of Common Stock issued and outstanding. All such issued and outstanding shares have been
duly authorized and validly issued, and are fully paid and non-assessable, and were issued in
compliance with all applicable state and federal laws concerning the issuance of securities and all
applicable pre-emptive, participation, rights of first refusal and other similar rights.

     Section 3.4 Valid Issuance of the New Notes. The New Notes, when issued, sold and
delivered in accordance with the terms and for the consideration set forth in this Agreement and
the Indenture, will constitute legal and binding obligations of the Company, be validly issued and
free of restrictions on transfer other than restrictions on transfer under this Agreement,
applicable state and federal securities laws and liens or encumbrances created by or imposed by the
Holder, and enforceable against the Company in accordance with their terms, except that such
enforcement may be limited by (a) bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting or relating to enforcement of creditors’ rights generally, and (b) general
principles of equity. Assuming the accuracy of the representations of the Holder in Section 2 of
this Agreement and subject to the filings required under the federal and state securities laws, the
New Notes will be issued in compliance in all material respects with all applicable federal and
state securities laws. The Underlying Common Stock has been duly reserved for issuance, and upon
issuance in accordance with the terms of the Company’s Certificate of Incorporation, as amended,
will be validly issued, fully paid and nonassessable and free of restrictions on transfer other
than restrictions on transfer under applicable federal and state securities laws and liens or
encumbrances created by or imposed by the Holder. Based in part upon the representations of the
Holder in Section 2 of this Agreement, the Underlying Common Stock, when issued and delivered in
accordance with the terms of the New Notes and the Indenture, will be issued in compliance in all
material respects with all applicable federal and state securities laws.

     Section 3.5 Financial Statements. Except as qualified in the SEC Documents, the
audited and unaudited financial statements and schedules included in the SEC Documents, present
fairly in all material respects the consolidated financial position of the Company and its
subsidiaries as of the dates indicated and the consolidated results of operations and cash flows of
the Company and its subsidiaries for the periods specified; except as qualified in the SEC
Documents, such financial statements and schedules have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis during the periods involved.

     Section 3.6 Legal Proceedings. No legal or governmental proceedings or investigations
are pending or, to the knowledge of the Company, threatened to which the Company is a party or to
which the property of the Company or any of its subsidiaries is subject that are not described in
the SEC Documents, except for such proceedings or investigations which would not reasonably be
expected to, singly or in the aggregate, result in a Material Adverse Effect. As used in this
Agreement, the term “Material Adverse Effect” shall mean when used in respect of any matter
relating to the Company a material adverse effect on the business, condition (financial or
otherwise), properties or results of operations of the Company and its subsidiaries, considered as
one enterprise, or would materially adversely affect the ability of the

- 6 -

 

Company to perform its obligations under this Agreement, the Indenture, the Registration
Rights Agreement and the New Notes. 

     Section 3.7 Compliance with Laws; Permits. The Company and its subsidiaries possess
all certificates, authorizations and permits issued by the appropriate federal, state or foreign
regulatory authorities necessary to conduct their respective businesses, except where the failure
to have such certificates, authorizations and permits would not reasonably be expected to have a
Material Adverse Effect, and none of the Company and its subsidiaries has received any notice of
proceedings relating to the revocation or modification of any such certificate, authorization or
permit which would reasonably be expected to, singly or in the aggregate, result in a Material
Adverse Effect. The Company and its subsidiaries are and have been in compliance with all
applicable laws, statutes, ordinances, rules, regulations, orders, judgments, decisions, decrees,
standards, and requirements relating to their respective businesses, except where any such
non-compliance would not reasonably be expected to have a Material Adverse Effect.

     Section 3.8 No Material Adverse Effect. Since the respective dates as of which
information is given in the SEC Documents, there has not been any event or occurrence having a
Material Adverse Effect on the Company or its subsidiaries, except as reflected or disclosed in a
subsequent SEC Document.

     Section 3.9 Additional Share Listing. The Company will use its best efforts to have
the shares of Common Stock issuable upon conversion of the New Notes approved by the Nasdaq Global
Select Market for listing promptly following the Closing Date.

ARTICLE IV

Miscellaneous Provisions

     Section 4.1 Notice. Any notice provided for in this Agreement shall be in writing and
shall be either personally delivered, or mailed first class mail (postage prepaid) with return
receipt requested or sent by reputable overnight courier service (charges prepaid) to such address
and to the attention of such person as the recipient party has specified by prior written notice to
the sending party. Notices will be deemed to have been given hereunder when delivered personally,
three business days after deposit in the U.S. mail postage prepaid with return receipt requested
and two business days after deposit postage prepaid with a reputable overnight courier service for
delivery on the next business day.

     Section 4.2 Hart-Scott-Rodino Act. The Holder agrees not to convert any New Notes
unless any waiting period under the Hart-Scott-Rodino Antirust Improvements Act of 1976, as
amended, applicable to such conversion shall have expired or been terminated. The Company agrees
to use commercially reasonable efforts to assist the Holder in causing any such waiting period to
expire or terminate.

     Section 4.3 Entire Agreement. This Agreement and the other documents and agreements
executed in connection with the Exchange Transaction embody the entire agreement and understanding
of the parties hereto with respect to the subject matter hereof and supersede all prior and
contemporaneous oral or written agreements, representations, warranties, contracts, correspondence,
conversations, memoranda and understandings between or among the parties or

- 7 -

 

any of their agents, representatives or affiliates relative to such subject matter, including,
without limitation, any term sheets, emails or draft documents.

     Section 4.4 Assignment; Binding Agreement. This Agreement and the various rights and
obligations arising hereunder shall inure to the benefit of and be binding upon the parties hereto
and their successors and assigns.

     Section 4.5 Counterparts. This Agreement may be executed in multiple counterparts,
and on separate counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same instrument. Any counterpart or other signature hereupon
delivered by facsimile shall be deemed for all purposes as constituting good and valid execution
and delivery of this Agreement by such party.

     Section 4.6 Remedies Cumulative. Except as otherwise provided herein, all rights and
remedies of the parties under this Agreement are cumulative and without prejudice to any other
rights or remedies available at law.

     Section 4.7 Governing Law. This Agreement shall in all respects be construed in
accordance with and governed by the substantive laws of the State of New York, without reference to
its choice of law rules.

     Section 4.8 No Third Party Beneficiaries or Other Rights. Nothing herein shall grant
to or create in any person not a party hereto, or any such person’s dependents or heirs, any right
to any benefits hereunder, and no such party shall be entitled to sue any party to this Agreement
with respect thereto.

     Section 4.9 Waiver; Consent. This Agreement may not be changed, amended, terminated,
augmented, rescinded or discharged (other than in accordance with its terms), in whole or in part,
except by a writing executed by the parties hereto. No waiver of any of the provisions or
conditions of this Agreement or any of the rights of a party hereto shall be effective or binding
unless such waiver shall be in writing and signed by the party claimed to have given or consented
thereto. Except to the extent otherwise agreed in writing, no waiver of any term, condition or
other provision of this Agreement, or any breach thereof shall be deemed to be a waiver of any
other term, condition or provision or any breach thereof, or any subsequent breach of the same
term, condition or provision, nor shall any forbearance to seek a remedy for any noncompliance or
breach be deemed to be a waiver of a party’s rights and remedies with respect to such noncompliance
or breach.

     Section 4.10 Word Meanings. The words such as “herein”, “hereinafter”, “hereof”, and
“hereunder” refer to this Agreement as a whole and not merely to a subdivision in which such words
appear unless the context otherwise requires. The singular shall include the plural, and vice
versa, unless the context otherwise requires. The masculine shall include the feminine and neuter,
and vice versa, unless the context otherwise requires.

     Section 4.11 No Broker. Neither party has engaged any third party as broker or finder
or incurred or become obligated to pay any broker’s commission or finder’s fee in connection with
the transactions contemplated by this Agreement other than such fees and expenses for which it
shall be solely responsible.

- 8 -

 

     Section 4.12 Further Assurances. The Holder and the Company each hereby agree to
execute and deliver, or cause to be executed and delivered, such other documents, instruments and
agreements, and take such other actions, as either party may reasonably request in connection with
the transactions contemplated by this Agreement.

     Section 4.13 Costs and Expenses. The Holder and the Company shall each pay their own
respective costs and expenses incurred in connection with the negotiation, preparation, execution
and performance of this Agreement, including, but not limited to, attorneys’ fees.

     Section 4.14 Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.

     Section 4.15 Severability. If any one or more of the provisions contained herein, or
the application thereof in any circumstance, is held invalid, illegal or unenforceable, the
validity, legality and enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired thereby.

[THE REMAINDER OF THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY.]

- 9 -

 

     IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be executed as of
the date first above written.

	 	 	 
	 

	 	HOLDER:
	 
	 	 
	 

	 	                                        
	 
	 	 
	 

	 	By:                                                             
	 

	 	Name:
	 

	 	Title:
	 
	 	 
	 

	 	THE COMPANY:
	 
	 	 
	 

	 	FINISAR CORPORATION
	 
	 	 
	 

	 	By:                                                             
	 

	 	Name:
	 

	 	Title:

Signature Page to Exchange Agreement

 

 

Exhibit A

Form of Indenture

 

 

Exhibit B

Form of Registration Rights Agreement

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