Document:

Supplemental Indenture

 EXHIBIT 4.2 
  

SUPPLEMENTAL INDENTURE 
  
 SUPPLEMENTAL INDENTURE NO. 1, dated as of September 26, 2005 (the “Supplemental Indenture”), among ICOS CORPORATION, a corporation duly
organized and existing under the laws of the State of Delaware, having its principal office at 22021 20th Avenue SE, Bothell, WA 98021 (herein called the “Company”), ICOS Washington Corporation, a corporation duly organized and existing
under the laws of the state of Washington and a wholly owned subsidiary of the Company, having its principal office at 22021 20th Avenue SE, Bothell, WA 98021 (herein called the “Successor”) and WELLS FARGO BANK, NATIONAL ASSOCIATION, a
national banking association organized under the laws of the United States, as Trustee hereunder (herein called the “Trustee”). 
  
 RECITALS OF THE COMPANY 
  
 The Company has heretofore delivered to the Trustee an Indenture dated as of June 20, 2003, (the “Original Indenture”), a form of which has been
filed with the Securities and Exchange Commission under the Securities Act of 1933, as amended, as an exhibit to the Company’s Quarterly Report on Form 10-Q (File No. 0-19171), filed with the Commission on August 3, 2003. 
  
 The Company and the Successor have entered into that certain Agreement and
Plan of Merger dated as of July 22, 2005 (the “Merger Agreement”) whereby upon the Effective Date (as defined below), the separate existence of the Company shall cease and the Successor, as the surviving corporation, shall (i) continue to
possess all of its assets, rights, powers and property as constituted immediately prior to the Effective Date; (ii) be subject to all actions previously taken by its and the Company’s Board of Directors; (iii) succeed, without other transfer,
to all of the assets, rights, powers and property of the Company in the manner as more fully set forth in Chapter 23B.11.060 of the Washington Business Corporation Act; (iv) continue to be subject to all of its debts, liabilities and obligations as
constituted immediately prior to the Effective Date; and (v) succeed, without other transfer, to all of the debts, liabilities and obligations of the Company in the same manner as if the Successor had itself incurred them, all as more fully provided
under the applicable provisions of the Washington Business Corporation Act and the Delaware General Corporation Law. 
  
 Article VI of the Original Indenture provides for the Company, the Successor and the Trustee to enter into an indenture supplemental to the Original
Indenture whereby the Successor shall expressly assume, by an indenture supplemental thereto, executed and delivered to the Trustee, in form satisfactory to the Trustee, all the obligations of the Company under the Securities (as defined therein)
and the Original Indenture. 
  
 The Board of Directors of the
Company has duly adopted resolutions authorizing the Company to execute and deliver this Supplemental Indenture. 
  
 The Board of Directors of the Successor has duly adopted resolutions authorizing the Successor to execute and deliver this Supplemental Indenture.

  

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 NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH: 
  
 For and in consideration of the premises and the purchase of the Securities
by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders of the Securities, as follows: 
  
 ARTICLE I 
 RELATION TO ORIGINAL INDENTURE;

 DEFINITIONS; AUTHORITY 
  
 SECTION 1.1 RELATION TO ORIGINAL. 
  
 This Supplemental Indenture constitutes an integral part of the Original Indenture. 
  
 SECTION 1.2 DEFINITIONS. 
  
 For all purposes of this Supplemental Indenture, except as otherwise expressly provided or unless the context otherwise requires: 
  
 (1) capitalized terms used but not defined herein shall have the respective
meanings assigned to them in the Original Indenture; 
  
 (2) all
references herein to Articles and Sections, unless otherwise specified, refer to the corresponding Articles and Sections of this Supplemental Indenture; 
  
 (3) “Effective Date” means the Effective Date of the Merger as defined in the Merger Agreement; and 
  
 (4) “Merger” means the Merger as defined in the Merger Agreement.

  
 SECTION 1.3 AUTHORITY FOR THIS SUPPLEMENTAL INDENTURE. 
  
 This Supplemental Indenture is adopted pursuant to Section 10.01 of the
Original Indenture. 
  
 ARTICLE II 
 SUBSTITUTION OF THE SUCCESSOR 
 FOR THE COMPANY
UNDER ORIGINAL INDENTURE 
  
 SECTION 2.1 ASSUMPTION BY THE SUCCESSOR. 

 
 The Successor hereby assumes, as of the Effective Date, the covenants and
obligations of the Company contained in the Original Indenture and in the Securities, including but not limited to payments of interest and principal to the Paying Agent in accordance with the terms of the Securities, as permitted by Article VI of
the Original Indenture. 
  

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 SECTION 2.2 SUBSTITUTION OF THE SUCCESSOR FOR THE COMPANY. 
  
 Upon the Effective Date and in accordance with Section 7.01 of the Original Indenture, the Successor shall succeed to, and
be substituted for, and may exercise every right and power of, the Company under the Original Indenture with the same effect as if the Successor had been named as the Company therein. 
  
 SECTION 2.3 NO EVENTS OF DEFAULT. 
  
 Each of the Company and the Successor represents and warrants that immediately after giving effect to the Merger, no Event of Default shall have occurred
and be continuing. 
  
 SECTION 2.4 EXECUTION AND DELIVERIES. 
  
 On or prior to the Effective Date the Company shall have delivered to the
Trustee each of the following (each of which shall be conditions precedent to the effectiveness of this Supplemental Indenture): 
  
 (1) an Officers’ Certificate stating that (a) the Merger and this Supplemental Indenture comply with Article VI of the Original Indenture and (b)
that, in the opinion of the signers, all conditions precedent contained herein or in the Original Indenture relating to the Merger have been complied with; and 
  

(2) an Opinion of Counsel, stating that (a) the Merger and this Supplemental Indenture comply with Article VI of the Original Indenture (b) that, in
the opinion of such counsel, all conditions precedent contained herein or in the Original Indenture relating to the Merger have been complied with. 
  
 In executing this Supplemental Indenture, the Trustee, subject to Sections 8.01 and 8.02 of the Original Indenture, shall be fully protected in relying
upon such Opinion of Counsel. 
  
 ARTICLE III 
 MISCELLANEOUS PROVISIONS 
  
 SECTION 3.1 EFFECTIVE DATE. 
  
 This Supplemental Indenture shall be fully effective in accordance with its terms as of the Effective Date, upon effectiveness of the Merger and
satisfaction of the conditions contained in Section 2.4 hereof and upon the execution and delivery hereof by each of the parties hereto. 
  
 SECTION 3.2 RATIFICATION OF ORIGINAL INDENTURE. 
  
 Except as expressly modified or amended hereby, the Original Indenture continues in full force and effect and is in all respects confirmed and preserved.

  

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 SECTION 3.3 GOVERNING LAW. 
  
 THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. 
  
 SECTION 3.4 COUNTERPARTS. 
  
 This Supplemental Indenture may be executed in any number of counterparts, each of which so executed shall be deemed to be
an original, but all such counterparts shall together constitute but one and the same instrument. 
  
 [Signature Page Follows.] 
  

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

			
	ICOS CORPORATION
		
	By:	 	 /s/ JOHN B. KLIEWER

	Name:	 	John B. Kliewer
	Title:	 	Vice President and General Counsel
	
	ICOS WASHINGTON CORPORATION
		
	By:	 	 /s/ JOHN B. KLIEWER

	Name:	 	John B. Kliewer
	Title:	 	Secretary and General Counsel
	
	WELLS FARGO BANK,
	 NATIONAL ASSOCIATION,
 as
Trustee

		
	By:	 	 /s/ MADELIENA J. HALL

	Name:	 	Madeliena J. Hall
	Title:	 	Assistant Vice PresidentAmendment No. 1 to Rights Agreement

 EXHIBIT 10.1 
  
 ICOS CORPORATION 
  
 AMENDMENT NO. 1 TO RIGHTS AGREEMENT 
  
 This Amendment No. 1 to Rights Agreement (this “Amendment No. 1”) is made as of September 26, 2005 by and among ICOS Corporation, a Delaware
corporation (the “Company”), ICOS Washington Corporation, a Washington corporation and wholly owned subsidiary of the Company (“ICOS WA”), and Mellon Investor Services LLC, a New Jersey limited liability company, as rights agent
(the “Rights Agent”) and amends that certain Rights Agreement dated as of August 9, 2002 by and between the Company and the Rights Agent (the “Rights Agreement”). Any capitalized terms used but not specifically defined in this
Amendment No. 1 shall have the meanings given those terms in the Rights Agreement. 
  
 A. Pursuant to the Agreement and Plan of Merger, dated July 22, 2005, between the Company and ICOS WA, the Company will reincorporate from the state of Delaware to the state of Washington by merging (such merger, the
“Merger”) with and into ICOS WA. 
  
 B. Upon the
effectiveness of the Merger, the separate existence of the Company shall cease, and the Merger will have the effects set forth in the applicable provisions of the Washington Business Corporations Act and the Delaware General Corporation Law.

  
 C. Upon the effectiveness of the Merger, each issued and
outstanding share of common stock, par value $0.01 per share, of the Company (“Company Common Stock”) will be converted automatically and without any further action on the part of the Company into one fully paid and nonassessable share of
common stock, par value $0.01 per share, of ICOS WA (“ICOS WA Common Stock”). 
  
 D. The Company and the Rights Agent intend to amend the Rights Agreement to confirm that ICOS WA will succeed to all of the rights and obligations of the Company under the Rights Agreement and to reflect certain
conforming changes in this Amendment. 
  
 E. Pursuant to and in
compliance with Section 26 of the Rights Agreement, the Company directs the Rights Agent to join the Company in amending the Rights Agreement as set forth in this Amendment. 
  
 NOW THEREFORE, in consideration of the premises and the mutual agreements set forth herein and in the Rights Agreement, the
parties hereto agree as follows: 
  

	 	1.	Succession. Upon the effectiveness of the Merger, ICOS WA will succeed to all of the rights and obligations of the Company under the Rights Agreement and replace the Company
as “the Company” under the Rights Agreement and the exhibits to the Rights Agreement. 

	 	2.	Right to Purchase Preferred Stock. Upon the effectiveness of the Merger, each right (a “Delaware Right”) theretofore issued by the Company that attached to a share
of Company Common Stock will be converted into a Right (a “Washington Right”) to purchase from ICOS WA one one-hundredth of a share of Series A Junior Participating Preferred Stock (“Preferred Stock”) of ICOS WA for the purchase
price of $250.00, subject to adjustment as provided in the Rights Agreement (the “Purchase Price”), such Right being attached to the share of ICOS WA Common Stock into which such share of Company Common Stock will be converted into in the
Merger. 

  

	 	3.	References in Rights Agreement. Upon the effectiveness of the Merger, all references in the Rights Agreement and the exhibits to the Rights Agreement to Company Common Stock
will become references to ICOS WA Common Stock, all references to Preferred Stock of the Company will become references to Preferred Stock of ICOS WA, all references to other securities of the Company will become references to other securities of
ICOS WA, all references to Rights will be to Rights with respect to Preferred Stock of ICOS WA rather than to Rights with respect to Preferred Stock of the Company and all references to stockholders will become references to shareholders.

  

	 	4.	Amendment of Certain Provisions. 

  

	 	a)	Upon the effectiveness of the Merger, Exhibit A shall be replaced in its entirety with the Certificate of Designation of Series A Junior Participating Preferred Stock of ICOS WA
filed with the Washington Secretary of State on August 1, 2005. 

  

	 	b)	Upon the effectiveness of the Merger, Section 30 of the Rights Agreement is amended by substituting “Washington” for “Delaware.” 

  

	 	5.	Miscellaneous. 

  

	 	a)	This Amendment shall be governed by and construed in accordance with the laws of the state of Washington; provided, however, that all provisions regarding the rights, duties and
obligations of the Rights Agent shall be governed by and construed in accordance with the laws of the state of New York applicable to contracts made and to be performed entirely within such state. 

  

	 	b)	This Amendment may be executed in counterparts and each of such counterparts shall for all purposes be deemed to be an original, and both such counterparts shall together constitute
but one and the same instrument. 

  

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	 	c)	Except as expressly set forth herein, this Amendment shall not by implication or otherwise alter, modify, amend or in any way affect any of the terms, conditions, obligations,
covenants or agreements contained in the Rights Agreement, all of which are ratified and affirmed in all respects and shall continue in full force and effect. 

  

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 IN WITNESS WHEREOF, the Company, the Rights Agent and ICOS WA have caused this Amendment No. 1 to be duly
executed, all as of the day and year first above written. 
  

			
	 ICOS CORPORATION,
 a Delaware
corporation
 By:

	
	 /s/ JOHN B. KLIEWER

	Name:	 	John B. Kliewer
	Title:	 	Vice President and General Counsel
	
	 ICOS WASHINGTON CORPORATION,
 a
Washington corporation
 By:

	
	 /s/ JOHN B. KLIEWER

	Name:	 	John B. Kliewer
	Title:	 	Secretary and General Counsel
	
	 MELLON INVESTOR SERVICES LLC,
 a New
Jersey limited liability company

	By:	 	 
	
	 /s/ THOMAS L. COOPER

	Name:	 	Thomas L. Cooper
	Title:	 	Client Relationship Executive

  

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